We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Nutanix Inc | NASDAQ:NTNX | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.05 | 0.08% | 62.24 | 57.99 | 66.00 | 63.89 | 62.21 | 63.00 | 1,640,414 | 05:00:07 |
|
|
☒
|
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
|
|
27-0989767
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
1740 Technology Drive, Suite 150
|
||
San Jose,
|
CA
|
95110
|
(Address of principal executive offices, including zip code)
|
(408)
|
216-8360
|
|
(Registrant's telephone number, including area code)
|
|
Large Accelerated Filer
|
|
☒
|
Accelerated Filer
|
|
☐
|
Non-accelerated Filer
|
|
☐ (Do not check if a smaller reporting company)
|
Smaller Reporting Company
|
|
☐
|
Emerging Growth Company
|
|
☐
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
|
|
☐
|
Securities registered pursuant to Section 12(b) of the Act:
|
||||
Title of each class
|
|
Trading symbol(s)
|
|
Name of each exchange on which registered
|
Class A Common Stock, $0.000025 par value per share
|
|
NTNX
|
|
Nasdaq Global Select Market
|
|
|
|
PAGE
|
|
|
||
|
|||
|
|||
|
|||
|
|||
|
|
|
|
|
|
||
|
|||
|
|||
|
|||
|
Item 3
|
||
|
Item 4
|
||
|
Item 5
|
||
|
|||
|
|
|
|
|
|
•
|
our future billings, revenue, cost of revenue and operating expenses, as well as changes in the cost of product revenue, component costs, product gross margins and support, entitlements and other services revenue and changes in research and development, sales and marketing and general and administrative expenses;
|
•
|
our business plans, initiatives and objectives, our ability to execute such plans, initiatives and objectives in a timely manner, and the impact of such plans, initiatives and objectives on our business, operations, and financial results;
|
•
|
our plans for, and the timing of, changes to our business model, including our ongoing transition to a subscription-based business model, our ability to manage, complete or realize the benefits of such transitions successfully and in a timely manner, and the short-term and long-term impacts of such transitions on our business, operations and financial results;
|
•
|
the benefits and capabilities of our platform, products, services and technology;
|
•
|
our growth strategy, our ability to effectively achieve and manage our growth, and the amount, timing and impact of any investments to grow our business, including plans to continue to increase demand generation and marketing spending, and continue to invest in our global engineering, research and development and sales and marketing teams;
|
•
|
anticipated trends, growth rates and challenges in our business and in the markets in which we operate, including the segmentation and productivity of our sales team;
|
•
|
our ability to develop new solutions, product features and technology and bring them to market in a timely manner, as well as the impact of including additional solutions in our product portfolio;
|
•
|
market acceptance of new technology and recently introduced solutions;
|
•
|
the interoperability and availability of our solutions with and on third-party hardware platforms;
|
•
|
our ability to increase sales of our solutions, particularly to large enterprise customers;
|
•
|
our ability to attract new end customers and retain and grow sales from our existing end customers;
|
•
|
our ability to maintain and strengthen our relationships with our channel partners and OEMs, and the impact of any changes to such relationships on our business, operations and financial results;
|
•
|
the effects of seasonal trends on our results of operations;
|
•
|
our expectations concerning relationships with third parties, including our ability to compress and stabilize sales cycles;
|
•
|
our ability to maintain, protect and enhance our intellectual property;
|
•
|
our exposure to and ability to guard against cyber attacks and other actual or perceived security breaches;
|
•
|
our ability to continue to expand internationally;
|
•
|
the effects of increased competition in our market and our ability to compete effectively;
|
•
|
anticipated capital expenditures;
|
•
|
future acquisitions or investments in complementary companies, products, services or technologies and the ability to successfully integrate completed acquisitions;
|
•
|
our ability to stay in compliance with laws and regulations that currently apply or become applicable to our business both in the United States and internationally, including recent changes in global tax laws;
|
•
|
macroeconomic and industry trends, projected growth or trend analysis;
|
•
|
our ability to attract and retain qualified employees and key personnel; and
|
•
|
the sufficiency of cash balances to meet cash needs for at least the next 12 months.
|
|
Page
|
|
|
|
As of
|
||||||
|
July 31,
2019 |
|
October 31,
2019 |
||||
|
|
|
|
||||
|
(in thousands, except per share data)
|
||||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
396,678
|
|
|
$
|
233,820
|
|
Short-term investments
|
512,156
|
|
|
655,584
|
|
||
Accounts receivable, net
|
245,475
|
|
|
214,883
|
|
||
Deferred commissions—current
|
46,238
|
|
|
51,966
|
|
||
Prepaid expenses and other current assets
|
74,665
|
|
|
61,654
|
|
||
Total current assets
|
1,275,212
|
|
|
1,217,907
|
|
||
Property and equipment, net
|
136,962
|
|
|
140,470
|
|
||
Operating lease right-of-use assets(1)
|
—
|
|
|
123,002
|
|
||
Deferred commissions—non-current
|
107,474
|
|
|
120,059
|
|
||
Intangible assets, net
|
66,773
|
|
|
62,428
|
|
||
Goodwill
|
185,180
|
|
|
185,260
|
|
||
Other assets—non-current
|
14,441
|
|
|
17,260
|
|
||
Total assets
|
$
|
1,786,042
|
|
|
$
|
1,866,386
|
|
|
|
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
74,047
|
|
|
$
|
83,381
|
|
Accrued compensation and benefits
|
99,804
|
|
|
95,018
|
|
||
Accrued expenses and other current liabilities(1)
|
28,797
|
|
|
17,434
|
|
||
Deferred revenue—current
|
396,667
|
|
|
429,429
|
|
||
Operating lease liabilities—current(1)
|
—
|
|
|
29,968
|
|
||
Total current liabilities
|
599,315
|
|
|
655,230
|
|
||
Deferred revenue—non-current
|
513,377
|
|
|
545,845
|
|
||
Operating lease liabilities—non-current(1)
|
—
|
|
|
118,410
|
|
||
Convertible senior notes, net
|
458,910
|
|
|
466,545
|
|
||
Other liabilities—non-current(1)
|
27,547
|
|
|
16,827
|
|
||
Total liabilities
|
1,599,149
|
|
|
1,802,857
|
|
||
Commitments and contingencies (Note 7)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, par value of $0.000025 per share— 200,000 shares authorized as of July 31, 2019 and October 31, 2019; no shares issued and outstanding as of July 31, 2019 and October 31, 2019
|
—
|
|
|
—
|
|
||
Common stock, par value of $0.000025 per share—1,200,000 (1,000,000 Class A, 200,000 Class B) shares authorized as of July 31, 2019 and October 31, 2019; 188,595 (168,155 Class A and 20,440 Class B) and 192,174 (175,080 Class A and 17,094 Class B) shares issued and outstanding as of July 31, 2019 and October 31, 2019
|
5
|
|
|
5
|
|
||
Additional paid-in capital
|
1,835,528
|
|
|
1,940,899
|
|
||
Accumulated other comprehensive income
|
669
|
|
|
1,234
|
|
||
Accumulated deficit
|
(1,649,309
|
)
|
|
(1,878,609
|
)
|
||
Total stockholders’ equity
|
186,893
|
|
|
63,529
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,786,042
|
|
|
$
|
1,866,386
|
|
|
(1)
|
During the first quarter of fiscal 2020, we adopted Accounting Standards Update ("ASU") No. 2016-02 using the modified retrospective method and elected the transition option that allows us not to restate the comparative periods in our condensed consolidated financial statements in the year of adoption. For additional details, refer to Note 1.
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands, except per share data)
|
||||||
Revenue:
|
|
|
|
||||
Product
|
$
|
224,346
|
|
|
$
|
192,444
|
|
Support, entitlements and other services
|
88,937
|
|
|
122,324
|
|
||
Total revenue
|
313,283
|
|
|
314,768
|
|
||
Cost of revenue:
|
|
|
|
||||
Product
|
39,261
|
|
|
21,233
|
|
||
Support, entitlements and other services
|
34,845
|
|
|
50,968
|
|
||
Total cost of revenue
|
74,106
|
|
|
72,201
|
|
||
Gross profit
|
239,177
|
|
|
242,567
|
|
||
Operating expenses:
|
|
|
|
||||
Sales and marketing
|
196,497
|
|
|
291,838
|
|
||
Research and development
|
110,531
|
|
|
138,206
|
|
||
General and administrative
|
27,339
|
|
|
32,860
|
|
||
Total operating expenses
|
334,367
|
|
|
462,904
|
|
||
Loss from operations
|
(95,190
|
)
|
|
(220,337
|
)
|
||
Other expense, net
|
(2,703
|
)
|
|
(5,040
|
)
|
||
Loss before (benefit from) provision for income taxes
|
(97,893
|
)
|
|
(225,377
|
)
|
||
(Benefit from) provision for income taxes
|
(3,628
|
)
|
|
3,923
|
|
||
Net loss
|
$
|
(94,265
|
)
|
|
$
|
(229,300
|
)
|
Net loss per share attributable to Class A and Class B common stockholders—basic and diluted
|
$
|
(0.54
|
)
|
|
$
|
(1.21
|
)
|
Weighted average shares used in computing net loss per share attributable to Class A and Class B common stockholders—basic and diluted
|
175,446
|
|
|
189,671
|
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Net loss
|
$
|
(94,265
|
)
|
|
$
|
(229,300
|
)
|
Other comprehensive loss, net of tax:
|
|
|
|
||||
Change in unrealized (loss) gain on available-for-sale securities, net of tax
|
(166
|
)
|
|
565
|
|
||
Comprehensive loss
|
$
|
(94,431
|
)
|
|
$
|
(228,735
|
)
|
|
Three Months Ended October 31, 2018
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Accumulated
Deficit
|
|
Total
Stockholders’
Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
(in thousands)
|
|||||||||||||||||||||
Balance - July 31, 2018
|
172,858
|
|
|
$
|
4
|
|
|
$
|
1,355,907
|
|
|
$
|
(1,002
|
)
|
|
$
|
(1,028,130
|
)
|
|
$
|
326,779
|
|
Issuance of common stock through employee equity incentive plans
|
2,629
|
|
|
—
|
|
|
3,680
|
|
|
—
|
|
|
—
|
|
|
3,680
|
|
|||||
Issuance of common stock from ESPP purchase
|
1,128
|
|
|
—
|
|
|
26,318
|
|
|
—
|
|
|
—
|
|
|
26,318
|
|
|||||
Issuance of common stock in connection with an acquisition
|
2,451
|
|
|
—
|
|
|
102,978
|
|
|
—
|
|
|
—
|
|
|
102,978
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
65,925
|
|
|
—
|
|
|
—
|
|
|
65,925
|
|
|||||
Vesting of early exercised stock options
|
—
|
|
|
—
|
|
|
70
|
|
|
—
|
|
|
—
|
|
|
70
|
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(166
|
)
|
|
—
|
|
|
(166
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(94,265
|
)
|
|
(94,265
|
)
|
|||||
Balance - October 31, 2018
|
179,066
|
|
|
$
|
4
|
|
|
$
|
1,554,878
|
|
|
$
|
(1,168
|
)
|
|
$
|
(1,122,395
|
)
|
|
$
|
431,319
|
|
|
Three Months Ended October 31, 2019
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive Income
|
|
Accumulated
Deficit
|
|
Total
Stockholders’
Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
(in thousands)
|
|||||||||||||||||||||
Balance - July 31, 2019
|
188,595
|
|
|
$
|
5
|
|
|
$
|
1,835,528
|
|
|
$
|
669
|
|
|
$
|
(1,649,309
|
)
|
|
$
|
186,893
|
|
Issuance of common stock through employee equity incentive plans
|
2,620
|
|
|
—
|
|
|
2,608
|
|
|
—
|
|
|
—
|
|
|
2,608
|
|
|||||
Issuance of common stock from ESPP purchase
|
959
|
|
|
|
|
21,337
|
|
|
—
|
|
|
—
|
|
|
21,337
|
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
81,426
|
|
|
—
|
|
|
—
|
|
|
81,426
|
|
|||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
565
|
|
|
—
|
|
|
565
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(229,300
|
)
|
|
(229,300
|
)
|
|||||
Balance - October 31, 2019
|
192,174
|
|
|
$
|
5
|
|
|
$
|
1,940,899
|
|
|
$
|
1,234
|
|
|
$
|
(1,878,609
|
)
|
|
$
|
63,529
|
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(94,265
|
)
|
|
$
|
(229,300
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation and amortization
|
16,183
|
|
|
22,462
|
|
||
Stock-based compensation
|
65,925
|
|
|
81,426
|
|
||
Change in fair value of contingent consideration
|
(799
|
)
|
|
—
|
|
||
Amortization of debt discount and issuance costs
|
7,148
|
|
|
7,635
|
|
||
Operating lease cost, net of accretion
|
—
|
|
|
6,671
|
|
||
Other
|
(759
|
)
|
|
103
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
23,497
|
|
|
30,592
|
|
||
Deferred commissions
|
(7,728
|
)
|
|
(18,313
|
)
|
||
Prepaid expenses and other assets
|
(3,812
|
)
|
|
16,150
|
|
||
Accounts payable
|
1,292
|
|
|
5,208
|
|
||
Accrued compensation and benefits
|
(19,689
|
)
|
|
(4,786
|
)
|
||
Accrued expenses and other liabilities
|
(7,442
|
)
|
|
(5,772
|
)
|
||
Operating leases, net
|
—
|
|
|
(3,469
|
)
|
||
Deferred revenue
|
70,273
|
|
|
65,230
|
|
||
Net cash provided by (used in) operating activities
|
49,824
|
|
|
(26,163
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Maturities of investments
|
143,409
|
|
|
171,441
|
|
||
Purchases of investments
|
(79,766
|
)
|
|
(321,474
|
)
|
||
Sales of investments
|
—
|
|
|
7,870
|
|
||
Purchases of property and equipment
|
(29,832
|
)
|
|
(18,203
|
)
|
||
Payments for business combinations, net of cash and restricted cash acquired
|
(18,662
|
)
|
|
—
|
|
||
Net cash provided by (used in) investing activities
|
15,149
|
|
|
(160,366
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from sales of shares through employee equity incentive plans, net of repurchases
|
29,890
|
|
|
23,973
|
|
||
Payment of debt in conjunction with business combinations
|
(991
|
)
|
|
—
|
|
||
Payment of issuance costs related to convertible senior notes
|
(75
|
)
|
|
—
|
|
||
Net cash provided by financing activities
|
28,824
|
|
|
23,973
|
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
$
|
93,797
|
|
|
$
|
(162,556
|
)
|
Cash, cash equivalents and restricted cash—beginning of period
|
307,098
|
|
|
399,520
|
|
||
Cash, cash equivalents and restricted cash—end of period
|
$
|
400,895
|
|
|
$
|
236,964
|
|
Restricted cash (1)
|
1,109
|
|
|
3,144
|
|
||
Cash and cash equivalents—end of period
|
$
|
399,786
|
|
|
$
|
233,820
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Cash paid for income taxes
|
$
|
3,910
|
|
|
$
|
7,779
|
|
Supplemental disclosures of non-cash investing and financing information:
|
|
|
|
||||
Issuance of common stock in connection with business combinations
|
$
|
102,978
|
|
|
$
|
—
|
|
Purchases of property and equipment included in accounts payable and accrued liabilities
|
$
|
15,717
|
|
|
$
|
12,200
|
|
Vesting of early exercised stock options
|
$
|
70
|
|
|
$
|
—
|
|
|
(1)
|
Included within other assets—non-current in the condensed consolidated balance sheets.
|
|
|
Revenue
|
|
Accounts Receivable
as of
|
||||||||
|
|
Three Months Ended
October 31, |
|
|||||||||
Partners
|
|
2018
|
|
2019
|
|
July 31,
2019 |
|
October 31, 2019
|
||||
Partner A
|
|
22
|
%
|
|
27
|
%
|
|
27
|
%
|
|
27
|
%
|
Partner B
|
|
12
|
%
|
|
12
|
%
|
|
(1)
|
|
|
16
|
%
|
Partner C
|
|
12
|
%
|
|
12
|
%
|
|
18
|
%
|
|
11
|
%
|
Partner D
|
|
(1)
|
|
|
(1)
|
|
|
(1)
|
|
|
10
|
%
|
Partner E
|
|
11
|
%
|
|
(1)
|
|
|
(1)
|
|
|
(1)
|
|
|
(1)
|
Less than 10%
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Subscription
|
$
|
126,976
|
|
|
$
|
217,896
|
|
Non-portable software
|
146,570
|
|
|
77,571
|
|
||
Hardware
|
32,547
|
|
|
9,724
|
|
||
Professional services
|
7,190
|
|
|
9,577
|
|
||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
•
|
Ratable — We recognize revenue from software entitlement and support subscriptions and SaaS offerings ratably over the contractual service period, the substantial majority of which relate to software entitlement and support subscriptions. These offerings represented approximately $83.0 million and $114.9 million of our subscription revenue for the three months ended October 31, 2018 and 2019, respectively.
|
•
|
Upfront — Revenue from our subscription software licenses is generally recognized upfront upon transfer of control to the customer, which happens when we make the software available to the customer. These subscription software licenses represented approximately $44.0 million and $103.0 million of our subscription revenue for the three months ended October 31, 2018 and 2019, respectively.
|
|
Deferred Revenue
|
|
Deferred Commissions
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Balance as of July 31, 2019
|
$
|
910,044
|
|
|
$
|
153,712
|
|
Additions
|
187,554
|
|
|
57,846
|
|
||
Revenue/commissions recognized
|
(122,324
|
)
|
|
(39,533
|
)
|
||
Balance as of October 31, 2019
|
$
|
975,274
|
|
|
$
|
172,025
|
|
|
As of July 31, 2019
|
||||||||||||||
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands)
|
||||||||||||||
Financial Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
33,156
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33,156
|
|
Commercial paper
|
—
|
|
|
103,029
|
|
|
—
|
|
|
103,029
|
|
||||
U.S. government securities
|
—
|
|
|
119,933
|
|
|
—
|
|
|
119,933
|
|
||||
Corporate bonds
|
—
|
|
|
9,996
|
|
|
—
|
|
|
9,996
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
|||||||
Corporate bonds
|
—
|
|
|
354,549
|
|
|
—
|
|
|
354,549
|
|
||||
Commercial paper
|
—
|
|
|
92,851
|
|
|
—
|
|
|
92,851
|
|
||||
U.S. government securities
|
—
|
|
|
64,756
|
|
|
—
|
|
|
64,756
|
|
||||
Total measured at fair value
|
$
|
33,156
|
|
|
$
|
745,114
|
|
|
$
|
—
|
|
|
$
|
778,270
|
|
Cash
|
|
|
|
|
|
|
130,564
|
|
|||||||
Total cash, cash equivalents and short-term investments
|
|
|
|
|
|
|
$
|
908,834
|
|
|
As of October 31, 2019
|
||||||||||||||
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands)
|
||||||||||||||
Financial Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
16,204
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16,204
|
|
Commercial paper
|
—
|
|
|
24,939
|
|
|
—
|
|
|
24,939
|
|
||||
Short-term investments:
|
|
|
|
|
|
|
|
|
|||||||
Corporate bonds
|
—
|
|
|
402,213
|
|
|
—
|
|
|
402,213
|
|
||||
Commercial paper
|
—
|
|
|
147,667
|
|
|
—
|
|
|
147,667
|
|
||||
U.S. government securities
|
—
|
|
|
105,704
|
|
|
—
|
|
|
105,704
|
|
||||
Total measured at fair value
|
$
|
16,204
|
|
|
$
|
680,523
|
|
|
$
|
—
|
|
|
$
|
696,727
|
|
Cash
|
|
|
|
|
|
|
192,677
|
|
|||||||
Total cash, cash equivalents and short-term investments
|
|
|
|
|
|
|
$
|
889,404
|
|
|
As of July 31, 2019
|
|
As of October 31, 2019
|
||||||||||||
|
Carrying Value
|
|
Estimated Fair Value
|
|
Carrying Value
|
|
Estimated Fair Value
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands)
|
||||||||||||||
Convertible senior notes, net
|
$
|
458,910
|
|
|
$
|
527,275
|
|
|
$
|
466,545
|
|
|
$
|
555,013
|
|
|
As of
October 31, 2019
|
||
|
(in thousands)
|
||
Due within one year
|
$
|
502,122
|
|
Due in one to two years
|
153,462
|
|
|
Total
|
$
|
655,584
|
|
|
As of
|
||||||
|
July 31,
2019 |
|
October 31,
2019 |
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Prepaid operating expenses
|
$
|
37,864
|
|
|
$
|
33,126
|
|
Tenant improvement allowances
|
—
|
|
|
7,354
|
|
||
VAT receivables
|
5,068
|
|
|
5,644
|
|
||
Prepaid income taxes
|
19,690
|
|
|
1,629
|
|
||
Other current assets
|
12,043
|
|
|
13,901
|
|
||
Total prepaid expenses and other current assets
|
$
|
74,665
|
|
|
$
|
61,654
|
|
|
Estimated
Useful Life |
|
As of
|
||||||
|
|
July 31,
2019 |
|
October 31,
2019 |
|||||
|
|
|
|
|
|
||||
|
(in months)
|
|
(in thousands)
|
||||||
Computer, production, engineering and other equipment
|
36
|
|
$
|
200,762
|
|
|
$
|
213,494
|
|
Demonstration units
|
12
|
|
59,981
|
|
|
62,519
|
|
||
Leasehold improvements
|
(1)
|
|
46,520
|
|
|
49,856
|
|
||
Furniture and fixtures
|
60
|
|
12,868
|
|
|
13,601
|
|
||
Total property and equipment, gross
|
|
|
320,131
|
|
|
339,470
|
|
||
Less: accumulated depreciation
|
|
|
(183,169
|
)
|
|
(199,000
|
)
|
||
Total property and equipment, net
|
|
|
$
|
136,962
|
|
|
$
|
140,470
|
|
|
(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,
2019 |
|
October 31,
2019 |
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Developed technology
|
$
|
79,300
|
|
|
$
|
79,300
|
|
Customer relationships
|
8,860
|
|
|
8,860
|
|
||
Trade name
|
4,170
|
|
|
4,170
|
|
||
Total intangible assets, gross
|
92,330
|
|
|
92,330
|
|
||
Less:
|
|
|
|
||||
Accumulated amortization of developed technology
|
(21,210
|
)
|
|
(24,904
|
)
|
||
Accumulated amortization of customer relationships
|
(3,392
|
)
|
|
(3,782
|
)
|
||
Accumulated amortization of trade name
|
(955
|
)
|
|
(1,216
|
)
|
||
Total accumulated amortization
|
(25,557
|
)
|
|
(29,902
|
)
|
||
Total intangible assets, net
|
$
|
66,773
|
|
|
$
|
62,428
|
|
Fiscal Year Ending July 31:
|
Amount
|
||
|
(in thousands)
|
||
2020 (remaining nine months)
|
$
|
13,035
|
|
2021
|
17,380
|
|
|
2022
|
16,183
|
|
|
2023
|
10,856
|
|
|
2024
|
3,210
|
|
|
Thereafter
|
1,764
|
|
|
Total
|
$
|
62,428
|
|
|
As of
|
||||||
|
July 31,
2019 |
|
October 31,
2019 |
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Accrued commissions
|
$
|
31,703
|
|
|
$
|
35,862
|
|
Accrued vacation
|
15,475
|
|
|
17,429
|
|
||
Payroll taxes payable
|
8,504
|
|
|
10,693
|
|
||
Contributions to ESPP withheld
|
20,778
|
|
|
10,515
|
|
||
Accrued bonus
|
11,413
|
|
|
7,486
|
|
||
Other
|
11,931
|
|
|
13,033
|
|
||
Total accrued compensation and benefits
|
$
|
99,804
|
|
|
$
|
95,018
|
|
|
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,
2019 |
|
October 31,
2019 |
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Principal amounts:
|
|
|
|
||||
Principal
|
$
|
575,000
|
|
|
$
|
575,000
|
|
Unamortized debt discount (1)
|
(109,956
|
)
|
|
(102,724
|
)
|
||
Unamortized debt issuance costs (1)
|
(6,134
|
)
|
|
(5,731
|
)
|
||
Net carrying amount
|
$
|
458,910
|
|
|
$
|
466,545
|
|
Carrying amount of equity component (2)
|
$
|
148,598
|
|
|
$
|
148,598
|
|
|
(1)
|
Included in the condensed 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 condensed consolidated balance sheets within additional paid-in capital, net of $3.0 million in equity issuance costs.
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Interest expense related to amortization of debt discount
|
$
|
6,770
|
|
|
$
|
7,232
|
|
Interest expense related to amortization of debt issuance costs
|
378
|
|
|
403
|
|
||
Total interest expense
|
$
|
7,148
|
|
|
$
|
7,635
|
|
|
As of
October 31, 2019
|
||
|
(in thousands)
|
||
Operating leases:
|
|
||
Operating lease right-of-use assets, gross
|
$
|
129,673
|
|
Accumulated amortization
|
(6,671
|
)
|
|
Operating lease right-of-use assets, net
|
$
|
123,002
|
|
|
|
||
Operating lease liabilities—current
|
$
|
29,968
|
|
Operating lease liabilities—non-current
|
118,410
|
|
|
Total operating lease liabilities
|
$
|
148,378
|
|
|
|
||
Weighted average remaining lease term (in years):
|
4.3
|
|
|
Weighted average discount rate:
|
5.6
|
%
|
|
Three Months Ended October 31, 2019
|
||
|
(in thousands)
|
||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
||
Operating cash flows from operating leases
|
$
|
8,750
|
|
|
|
||
Lease liabilities arising from obtaining right-of-use assets:
|
|
||
Operating leases
|
$
|
12,969
|
|
Fiscal Year Ending July 31:
|
Amount
|
||
|
(in thousands)
|
||
2020 (remaining nine months)
|
$
|
27,473
|
|
2021
|
38,901
|
|
|
2022
|
37,903
|
|
|
2023
|
36,083
|
|
|
2024
|
25,177
|
|
|
Thereafter
|
3,227
|
|
|
Total lease payments
|
168,764
|
|
|
Less: imputed interest
|
(20,386
|
)
|
|
Total lease obligation
|
148,378
|
|
|
Less: current lease obligations
|
29,968
|
|
|
Long-term lease obligations
|
$
|
118,410
|
|
Fiscal Year Ending July 31:
|
Amount
|
||
|
(in thousands)
|
||
2020
|
$
|
39,540
|
|
2021
|
41,909
|
|
|
2022
|
41,332
|
|
|
2023
|
40,695
|
|
|
2024
|
30,240
|
|
|
Thereafter
|
3,511
|
|
|
Total
|
$
|
197,227
|
|
•
|
If the Average Stock Price on any given quarterly measurement date does not equal or exceed $80, then none of the MSUs will vest that quarter, and any unvested MSUs will carry over to the next quarter (the "Carryover MSUs");
|
•
|
If the Average Stock Price on any given quarterly measurement date equals or exceeds $80, then 1/18th of the MSUs plus the applicable Carryover MSUs, if any, would vest; and/or
|
•
|
If the Average Stock Price never equals or exceeds $80 during the Performance Period, the MSUs would terminate at the end of the Performance Period.
|
|
Number of
Shares |
|
Grant Date Fair Value per Share
|
|||
|
(in thousands)
|
|
|
|||
Outstanding at July 31, 2019
|
22,136
|
|
|
$
|
36.72
|
|
Granted
|
3,525
|
|
|
$
|
21.41
|
|
Released
|
(2,145
|
)
|
|
$
|
33.96
|
|
Forfeited
|
(2,238
|
)
|
|
$
|
32.00
|
|
Outstanding at October 31, 2019
|
21,278
|
|
|
$
|
34.95
|
|
|
Three Months Ended
October 31, |
||||
|
2018
|
|
2019
|
||
Expected term (in years)
|
0.79
|
|
|
0.92
|
|
Risk-free interest rate
|
2.5
|
%
|
|
1.9
|
%
|
Volatility
|
49.5
|
%
|
|
68.7
|
%
|
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Cost of revenue:
|
|
|
|
||||
Product
|
$
|
698
|
|
|
$
|
1,112
|
|
Support, entitlements and other services
|
3,157
|
|
|
4,751
|
|
||
Sales and marketing
|
22,606
|
|
|
27,775
|
|
||
Research and development
|
31,009
|
|
|
37,563
|
|
||
General and administrative
|
8,455
|
|
|
10,225
|
|
||
Total stock-based compensation expense
|
$
|
65,925
|
|
|
$
|
81,426
|
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands, except per share data)
|
||||||
Numerator:
|
|
|
|
||||
Net loss
|
$
|
(94,265
|
)
|
|
$
|
(229,300
|
)
|
Denominator:
|
|
|
|
||||
Weighted average shares—basic and diluted
|
175,446
|
|
|
189,671
|
|
||
Net loss per share attributable to common stockholders—basic and diluted
|
$
|
(0.54
|
)
|
|
$
|
(1.21
|
)
|
|
Three Months Ended
October 31, |
||||
|
2018
|
|
2019
|
||
|
|
|
|
||
|
(in thousands)
|
||||
Outstanding stock options and RSUs
|
33,697
|
|
|
29,544
|
|
Employee stock purchase plan
|
1,596
|
|
|
2,845
|
|
Contingently issuable shares pursuant to business combinations
|
920
|
|
|
611
|
|
Common stock subject to repurchase
|
30
|
|
|
—
|
|
Common stock warrants
|
34
|
|
|
34
|
|
Total
|
36,277
|
|
|
33,034
|
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
U.S.
|
$
|
181,006
|
|
|
$
|
184,767
|
|
Asia Pacific
|
67,238
|
|
|
60,321
|
|
||
Europe, the Middle East and Africa
|
54,776
|
|
|
56,713
|
|
||
Other Americas
|
10,263
|
|
|
12,967
|
|
||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
|
As of and for the
|
||||||
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands, except percentages)
|
||||||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
Year-over-year percentage increase
|
13.7
|
%
|
|
0.5
|
%
|
||
Subscription revenue
|
$
|
126,976
|
|
|
$
|
217,896
|
|
Software and support revenue (TCV revenue)
|
$
|
280,736
|
|
|
$
|
305,044
|
|
Total billings
|
$
|
383,556
|
|
|
$
|
379,998
|
|
Subscription billings
|
$
|
194,764
|
|
|
$
|
275,538
|
|
Software and support billings (TCV billings)
|
$
|
351,009
|
|
|
$
|
370,274
|
|
Gross profit
|
$
|
239,177
|
|
|
$
|
242,567
|
|
Adjusted gross profit
|
$
|
246,200
|
|
|
$
|
252,124
|
|
Gross margin
|
76.3
|
%
|
|
77.1
|
%
|
||
Adjusted gross margin
|
78.6
|
%
|
|
80.1
|
%
|
||
Total deferred revenue
|
$
|
701,800
|
|
|
$
|
975,274
|
|
Net cash provided by (used in) operating activities
|
$
|
49,824
|
|
|
$
|
(26,163
|
)
|
Free cash flow
|
$
|
19,992
|
|
|
$
|
(44,366
|
)
|
Non-GAAP operating expenses
|
$
|
272,065
|
|
|
$
|
386,337
|
|
Total end customers
|
11,490
|
|
|
14,960
|
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Disaggregation of revenue:
|
|
|
|
||||
Subscription revenue
|
$
|
126,976
|
|
|
$
|
217,896
|
|
Non-portable software revenue
|
146,570
|
|
|
77,571
|
|
||
Hardware revenue
|
32,547
|
|
|
9,724
|
|
||
Professional services revenue
|
7,190
|
|
|
9,577
|
|
||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
|
|
|
|
||||
Disaggregation of billings:
|
|
|
|
||||
Subscription billings
|
$
|
194,764
|
|
|
$
|
275,538
|
|
Non-portable software billings
|
146,570
|
|
|
77,571
|
|
||
Hardware billings
|
32,547
|
|
|
9,724
|
|
||
Professional services billings
|
9,675
|
|
|
17,165
|
|
||
Total billings
|
$
|
383,556
|
|
|
$
|
379,998
|
|
•
|
Ratable — We recognize revenue from software entitlement and support subscriptions and SaaS offerings ratably over the contractual service period, the substantial majority of which relate to software entitlement and support subscriptions. These offerings represented approximately $83.0 million and $114.9 million of our subscription revenue for the three months ended October 31, 2018 and 2019, respectively.
|
•
|
Upfront — Revenue from our subscription software licenses is generally recognized upfront upon transfer of control to the customer, which happens when we make the software available to the customer. These subscription software licenses represented approximately $44.0 million and $103.0 million of our subscription revenue for the three months ended October 31, 2018 and 2019, respectively.
|
•
|
are used by management and the Board of Directors to understand and evaluate our performance and trends, as well as to provide a useful measure for period-to-period comparisons of our core business;
|
•
|
are widely used as a measure of financial performance to understand and evaluate companies in our industry; and
|
•
|
are used by management to prepare and approve our annual budget and to develop short-term and long-term operational and compensation plans, as well as to assess our actual performance against our goals.
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands, except percentages)
|
||||||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
Change in deferred revenue, net of acquisitions (1)
|
70,273
|
|
|
65,230
|
|
||
Total billings (non-GAAP)
|
$
|
383,556
|
|
|
$
|
379,998
|
|
|
|
|
|
||||
Gross profit
|
$
|
239,177
|
|
|
$
|
242,567
|
|
Stock-based compensation
|
3,855
|
|
|
5,863
|
|
||
Amortization of intangible assets
|
3,168
|
|
|
3,694
|
|
||
Adjusted gross profit (non-GAAP)
|
$
|
246,200
|
|
|
$
|
252,124
|
|
|
|
|
|
||||
Gross margin
|
76.3
|
%
|
|
77.1
|
%
|
||
Stock-based compensation
|
1.2
|
%
|
|
1.8
|
%
|
||
Amortization of intangible assets
|
1.1
|
%
|
|
1.2
|
%
|
||
Adjusted gross margin (non-GAAP)
|
78.6
|
%
|
|
80.1
|
%
|
||
|
|
|
|
||||
Operating expenses
|
$
|
334,367
|
|
|
$
|
462,904
|
|
Stock-based compensation
|
(62,070
|
)
|
|
(75,563
|
)
|
||
Amortization of intangible assets
|
(550
|
)
|
|
(651
|
)
|
||
Change in fair value of contingent consideration
|
799
|
|
|
—
|
|
||
Acquisition-related costs
|
(481
|
)
|
|
—
|
|
||
Other
|
—
|
|
|
(353
|
)
|
||
Operating expenses (non-GAAP)
|
$
|
272,065
|
|
|
$
|
386,337
|
|
|
|
|
|
||||
Net cash provided by (used in) operating activities
|
$
|
49,824
|
|
|
$
|
(26,163
|
)
|
Purchases of property and equipment
|
(29,832
|
)
|
|
(18,203
|
)
|
||
Free cash flow (non-GAAP)
|
$
|
19,992
|
|
|
$
|
(44,366
|
)
|
|
(1)
|
Amount for the three months ended October 31, 2018 excludes approximately $0.3 million of deferred revenue assumed in an acquisition.
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Subscription revenue
|
$
|
126,976
|
|
|
$
|
217,896
|
|
Change in subscription deferred revenue, net of acquisitions (2)
|
67,788
|
|
|
57,642
|
|
||
Subscription billings
|
$
|
194,764
|
|
|
$
|
275,538
|
|
|
|
|
|
||||
Professional services revenue
|
$
|
7,190
|
|
|
$
|
9,577
|
|
Change in professional services deferred revenue
|
2,485
|
|
|
7,588
|
|
||
Professional services billings
|
$
|
9,675
|
|
|
$
|
17,165
|
|
|
|
|
|
||||
Software revenue
|
$
|
191,799
|
|
|
$
|
182,720
|
|
Hardware revenue
|
32,547
|
|
|
9,724
|
|
||
Product revenue
|
224,346
|
|
|
192,444
|
|
||
Support, entitlements and other services revenue
|
88,937
|
|
|
122,324
|
|
||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
|
|
|
|
||||
Software and support revenue (TCV revenue) (1)
|
$
|
280,736
|
|
|
$
|
305,044
|
|
Change in software and support deferred revenue (TCV deferred revenue), net of acquisitions (2)
|
70,273
|
|
|
65,230
|
|
||
Software and support billings (TCV billings) (1)
|
$
|
351,009
|
|
|
$
|
370,274
|
|
|
(1)
|
Software and support revenue and billings (TCV revenue and billings) include software and support, entitlements and other services revenue and billings.
|
(2)
|
Amount for the three months ended October 31, 2018 excludes approximately $0.3 million of deferred revenue assumed in an acquisition.
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Revenue:
|
|
|
|
||||
Product
|
$
|
224,346
|
|
|
$
|
192,444
|
|
Support, entitlements and other services
|
88,937
|
|
|
122,324
|
|
||
Total revenue
|
313,283
|
|
|
314,768
|
|
||
Cost of revenue:
|
|
|
|
||||
Product (1)(2)
|
39,261
|
|
|
21,233
|
|
||
Support, entitlements and other services (1)
|
34,845
|
|
|
50,968
|
|
||
Total cost of revenue
|
74,106
|
|
|
72,201
|
|
||
Gross profit
|
239,177
|
|
|
242,567
|
|
||
Operating expenses:
|
|
|
|
||||
Sales and marketing (1)(2)
|
196,497
|
|
|
291,838
|
|
||
Research and development (1)
|
110,531
|
|
|
138,206
|
|
||
General and administrative (1)
|
27,339
|
|
|
32,860
|
|
||
Total operating expenses
|
334,367
|
|
|
462,904
|
|
||
Loss from operations
|
(95,190
|
)
|
|
(220,337
|
)
|
||
Other expense, net
|
(2,703
|
)
|
|
(5,040
|
)
|
||
Loss before (benefit from) provision for income taxes
|
(97,893
|
)
|
|
(225,377
|
)
|
||
(Benefit from) provision for income taxes
|
(3,628
|
)
|
|
3,923
|
|
||
Net loss
|
$
|
(94,265
|
)
|
|
$
|
(229,300
|
)
|
|
|
|
|
||||
(1) Includes stock-based compensation expense as follows:
|
|
|
|
||||
Product cost of revenue
|
$
|
698
|
|
|
$
|
1,112
|
|
Support, entitlements and other services cost of revenue
|
3,157
|
|
|
4,751
|
|
||
Sales and marketing
|
22,606
|
|
|
27,775
|
|
||
Research and development
|
31,009
|
|
|
37,563
|
|
||
General and administrative
|
8,455
|
|
|
10,225
|
|
||
Total stock-based compensation expense
|
$
|
65,925
|
|
|
$
|
81,426
|
|
|
|
|
|
||||
(2) Includes amortization of intangible assets as follows:
|
|
|
|
||||
Product cost of revenue
|
$
|
3,168
|
|
|
$
|
3,694
|
|
Sales and marketing
|
550
|
|
|
651
|
|
||
Total amortization of intangible assets
|
$
|
3,718
|
|
|
$
|
4,345
|
|
|
Three Months Ended
October 31, |
||||
|
2018
|
|
2019
|
||
|
|
|
|
||
|
(as a percentage of total revenue)
|
||||
Revenue:
|
|
|
|
||
Product
|
71.6
|
%
|
|
61.1
|
%
|
Support, entitlements and other services
|
28.4
|
%
|
|
38.9
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
Cost of revenue:
|
|
|
|
||
Product
|
12.6
|
%
|
|
6.7
|
%
|
Support, entitlements and other services
|
11.1
|
%
|
|
16.2
|
%
|
Total cost of revenue
|
23.7
|
%
|
|
22.9
|
%
|
Gross profit
|
76.3
|
%
|
|
77.1
|
%
|
Operating expenses:
|
|
|
|
||
Sales and marketing
|
62.7
|
%
|
|
92.7
|
%
|
Research and development
|
35.3
|
%
|
|
43.9
|
%
|
General and administrative
|
8.7
|
%
|
|
10.4
|
%
|
Total operating expenses
|
106.7
|
%
|
|
147.0
|
%
|
Loss from operations
|
(30.4
|
)%
|
|
(69.9
|
)%
|
Other expense, net
|
(0.9
|
)%
|
|
(1.6
|
)%
|
Loss before (benefit from) provision for income taxes
|
(31.3
|
)%
|
|
(71.5
|
)%
|
(Benefit from) provision for income taxes
|
(1.2
|
)%
|
|
1.2
|
%
|
Net loss
|
(30.1
|
)%
|
|
(72.7
|
)%
|
|
Three Months Ended
October 31, |
|
Change
|
|||||||||||
|
2018
|
|
2019
|
|
$
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Product
|
$
|
224,346
|
|
|
$
|
192,444
|
|
|
$
|
(31,902
|
)
|
|
(14
|
)%
|
Support, entitlements and other services
|
88,937
|
|
|
122,324
|
|
|
33,387
|
|
|
38
|
%
|
|||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
|
$
|
1,485
|
|
|
—
|
%
|
|
Three Months Ended
October 31, |
|
Change
|
|||||||||||
|
2018
|
|
2019
|
|
$
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
U.S.
|
$
|
181,006
|
|
|
$
|
184,767
|
|
|
$
|
3,761
|
|
|
2
|
%
|
Asia Pacific
|
67,238
|
|
|
60,321
|
|
|
(6,917
|
)
|
|
(10
|
)%
|
|||
Europe, the Middle East and Africa
|
54,776
|
|
|
56,713
|
|
|
1,937
|
|
|
4
|
%
|
|||
Other Americas
|
10,263
|
|
|
12,967
|
|
|
2,704
|
|
|
26
|
%
|
|||
Total revenue
|
$
|
313,283
|
|
|
$
|
314,768
|
|
|
$
|
1,485
|
|
|
—
|
%
|
|
Three Months Ended
October 31, |
|
Change
|
|||||||||||
|
2018
|
|
2019
|
|
$
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Cost of product revenue
|
$
|
39,261
|
|
|
$
|
21,233
|
|
|
$
|
(18,028
|
)
|
|
(46
|
)%
|
Product gross margin
|
82.5
|
%
|
|
89.0
|
%
|
|
|
|
|
|
||||
Cost of support, entitlements and other services revenue
|
$
|
34,845
|
|
|
$
|
50,968
|
|
|
$
|
16,123
|
|
|
46
|
%
|
Support, entitlements and other services gross margin
|
60.8
|
%
|
|
58.3
|
%
|
|
|
|
|
|
||||
Total gross margin
|
76.3
|
%
|
|
77.1
|
%
|
|
|
|
|
|
|
Three Months Ended
October 31, |
|
Change
|
|||||||||||
|
2018
|
|
2019
|
|
$
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(in thousands, except percentages)
|
|||||||||||||
Other expense, net
|
$
|
(2,703
|
)
|
|
$
|
(5,040
|
)
|
|
$
|
(2,337
|
)
|
|
86
|
%
|
|
Three Months Ended
October 31, |
||||||
|
2018
|
|
2019
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Net cash provided by (used in) operating activities
|
$
|
49,824
|
|
|
$
|
(26,163
|
)
|
Net cash provided by (used in) investing activities
|
15,149
|
|
|
(160,366
|
)
|
||
Net cash provided by financing activities
|
28,824
|
|
|
23,973
|
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
$
|
93,797
|
|
|
$
|
(162,556
|
)
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less than 1 Year
|
|
1 Year to 3 Years
|
|
3 to 5 Years
|
|
More than 5 Years
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Principal amount payable on convertible senior notes (1)
|
$
|
575,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
575,000
|
|
|
$
|
—
|
|
Operating leases (undiscounted basis) (2)
|
201,431
|
|
|
42,297
|
|
|
87,425
|
|
|
65,063
|
|
|
6,646
|
|
|||||
Other commitments (3)
|
78,588
|
|
|
74,301
|
|
|
3,413
|
|
|
874
|
|
|
—
|
|
|||||
Guarantees with contract manufacturers and OEMs
|
152,675
|
|
|
94,800
|
|
|
57,875
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
1,007,694
|
|
|
$
|
211,398
|
|
|
$
|
148,713
|
|
|
$
|
640,937
|
|
|
$
|
6,646
|
|
|
(1)
|
For additional information regarding our convertible senior notes, refer to Note 5 of Part I, Item 1 of this Quarterly Report on Form 10-Q.
|
(2)
|
For additional information regarding our operating leases, refer to Note 6 of Part I, Item 1 of this Quarterly Report on Form 10-Q.
|
(3)
|
Purchase obligations and other commitments pertaining to our daily business operations.
|
•
|
if current or prospective end customers prefer our historical life-of-device licenses, adoption of our subscription-based model may not meet our expectations, or may take longer than anticipated to achieve;
|
•
|
potential confusion of or creation of concerns among current or prospective end customers and channel partners, including concerns regarding changes to our pricing models;
|
•
|
we may be unsuccessful in implementing or maintaining subscription-based pricing models, or we may select a pricing model that is not optimal and could negatively affect adoption, renewal rates and our business results;
|
•
|
our end customers may shift purchases to our lower priced subscription offerings, which could negatively affect our overall financial results;
|
•
|
when purchasing multi-year term-based subscription licenses, our customers may request to pay for only the first year of the applicable term upfront, instead of the full term as we have seen historically, which would negatively impact our operating and free cash flows, potentially significantly;
|
•
|
our relationships with existing channel partners that are accustomed to selling life-of-device licenses may be damaged, and we may be required to dedicate additional time and resources to educate our channel partners about our transition, each of which may negatively affect our business and financial results;
|
•
|
if we are unsuccessful in adjusting our go-to-market cost structure, or in doing so in a timely or cost-effective manner, we may incur sales compensation costs at a higher than forecasted rate, particularly if the pace of our subscription transition is faster than anticipated;
|
•
|
we may face additional and/or different financial reporting obligations, or we may choose to report our financial results using new or different metrics, either of which could increase the costs associated with our financial reporting and investor relations activities; and
|
•
|
investors, industry and financial analysts may have difficulty understanding the shift in our business model, resulting in changes in financial estimates or failure to meet investor expectations.
|
•
|
software providers, such as VMware, that offer a broad range of virtualization, infrastructure and management products to build and operate enterprise and hybrid clouds;
|
•
|
traditional IT systems vendors, such as Cisco, Dell, HPE, Hitachi, IBM and Lenovo, that offer integrated systems that include bundles of servers, storage and networking solutions, as well as a broad range of standalone server and storage products;
|
•
|
traditional storage array vendors, such as Dell, Hitachi and NetApp, which typically sell centralized storage products; and
|
•
|
providers of public cloud infrastructure and SaaS-based offerings, such as Amazon, Google Inc. and Microsoft Corporation.
|
•
|
arrangements entered into on a ratable subscription basis may delay when we can recognize revenue, even when compared to similar term-based subscription sales, which we currently recognize upfront, and can require up-front costs, which may be significant;
|
•
|
since revenue is recognized ratably over the term of the customer agreement, any decrease in customer purchases of our ratable subscription-based products and services will not be fully reflected in our operating results until future periods. This will also make it difficult for us to increase our revenue through additional ratable subscription sales in any one period;
|
•
|
cloud-based ratable subscription arrangements are generally under short-term agreements. Accordingly, our customers generally have no long-term obligation to us and may cancel their subscription at any time, even if our customers are satisfied with our subscription products; and
|
•
|
there is no assurance that the cloud-based solutions we offer on a ratable subscription basis, including new products that we may introduce, will receive broad marketplace acceptance.
|
•
|
competition from companies that traditionally target larger enterprises, service providers and government entities and that may have pre-existing relationships or purchase commitments from such end customers;
|
•
|
increased purchasing power and leverage held by large end customers in negotiating contractual arrangements with us;
|
•
|
more stringent requirements in our support service contracts, including demand for quicker support response times and penalties for any failure to meet support requirements; and
|
•
|
longer sales cycles and the associated risk that substantial time and resources may be spent on a potential end customer that elects not to purchase our solutions.
|
•
|
the timing and magnitude of orders, shipments and acceptance of our solutions in any quarter;
|
•
|
our ability to attract new and retain existing end customers;
|
•
|
disruptions in our sales channels or shifts in our relationships with important channel partners and OEMs;
|
•
|
the timing of revenue recognition for our sales, the impact of which is heightened by our focus on software-only sales and ongoing transition to a subscription-based model;
|
•
|
reductions in end customers’ budgets for information technology purchases;
|
•
|
delays in end customers’ purchasing cycles or deferments of end customers’ purchases in anticipation of new products or updates from us or our competitors;
|
•
|
fluctuations in demand and competitive pricing pressures for our solutions;
|
•
|
the mix of solutions sold, including the mix between appliance and software-only sales and the mix between subscription-based and non-subscription-based transactions, and the mix of revenue between products and support, entitlements and other services, which will depend in part on whether we are successful in executing our strategy to transition our business to a subscription-based model;
|
•
|
our ability to develop, introduce and ship in a timely manner new solutions and product enhancements that meet customer requirements, and market acceptance of such new solutions and product enhancements;
|
•
|
the timing of product releases or upgrades or announcements by us or our competitors;
|
•
|
any change in the competitive dynamics of our markets, including consolidation or partnerships among our competitors or partners, new entrants or discounting of prices;
|
•
|
the amount and timing of expenses to grow our business and the extent to which we are able to take advantage of economies of scale or to leverage our relationships with OEM or channel partners;
|
•
|
the costs associated with acquiring new businesses and technologies and the follow-on costs of integrating and consolidating the results of acquired businesses;
|
•
|
the amount and timing of stock-based compensation expenses;
|
•
|
our ability to control the costs of our solutions and their key components, or to pass along any cost increases to our end customers;
|
•
|
general economic, industry and market conditions; and
|
•
|
future accounting pronouncements and changes in accounting policies.
|
•
|
lost revenue or lost OEM or other channel partners or end customers;
|
•
|
increased costs, including warranty expense and costs associated with end customer support as well as development costs to remedy the errors or defects;
|
•
|
delays, cancellations, reductions or rescheduling of orders or shipments;
|
•
|
product returns or discounts; and
|
•
|
damage to our reputation and brand.
|
•
|
public sector budgetary cycles and funding authorizations;
|
•
|
changes in fiscal or contracting policies;
|
•
|
decreases in available government funding;
|
•
|
changes in government programs or applicable requirements;
|
•
|
the adoption of new laws or regulations or changes to existing laws or regulations;
|
•
|
potential delays or changes in the government appropriations or other funding authorization processes; and
|
•
|
higher expenses associated with, or delays caused by, diligence and qualifying or maintaining qualification as a government vendor.
|
•
|
business practices may differ from those in the United States and may require us in the future to include terms other than our standard terms in customer, channel partner, employee, consultant and other contracts;
|
•
|
political, economic and social instability or uncertainty around the world, including the United Kingdom's potential separation from the European Union, commonly known as "Brexit";
|
•
|
potential changes in trade relations arising from policy initiatives implemented by, or statements made by, the U.S. government, which has been critical of existing and proposed trade agreements;
|
•
|
the potential impact of tariffs or other trade restrictions imposed by, or threatened to be imposed by, the U.S. government, such as the recently imposed tariffs for Chinese imports to the U.S.;
|
•
|
greater difficulty in enforcing contracts, judgments and arbitration awards in international courts, and in collecting accounts receivable and longer payment and collection periods;
|
•
|
greater risk of unexpected changes in regulatory practices, tariffs and tax laws and treaties;
|
•
|
risks associated with trade restrictions and foreign legal requirements, including the importation, certification and localization of our solutions required in foreign countries;
|
•
|
greater risk of a failure of foreign employees, partners, distributors and resellers to comply with both U.S. and foreign laws, including antitrust regulations, the FCPA, the U.K. Bribery Act, U.S. or foreign sanctions regimes and export or import control laws and any trade regulations ensuring fair trade practices;
|
•
|
heightened risk of unfair or corrupt business practices in certain geographies and of improper or fraudulent sales arrangements that may impact financial results and result in restatements of, or irregularities in, financial statements;
|
•
|
requirements to comply with foreign privacy, data protection and information security laws and regulations and the risks and costs of noncompliance;
|
•
|
reduced or uncertain protection for intellectual property rights in some countries;
|
•
|
impediments to the flow of foreign exchange capital payments and receipts due to exchange controls instituted by certain foreign governments;
|
•
|
increased expenses incurred in establishing and maintaining corporate entities, office space and equipment for our international operations;
|
•
|
difficulties in managing and staffing international offices and increased travel, infrastructure and legal and regulatory compliance costs associated with multiple international locations, including costs related to additional regulatory reviews or audits, financial accounting and reporting obligations and international cybersecurity requirements;
|
•
|
greater difficulty in identifying, attracting and retaining local experienced personnel, and the costs and expenses associated with such activities;
|
•
|
the challenge of managing a development team in geographically disparate locations;
|
•
|
management communication and integration problems resulting from cultural and geographic dispersion;
|
•
|
differing employment practices and labor relations issues;
|
•
|
fluctuations in exchange rates between the U.S. dollar and foreign currencies in markets where we do business; and
|
•
|
treatment of revenue from international sources for tax purposes and changes in tax laws, regulations or official interpretations, including being subject to foreign tax laws and being liable for paying withholding, income or other taxes in foreign jurisdictions.
|
•
|
If open source software programmers, most of whom we do not employ, do not continue to develop and enhance open source technologies, our development expenses could increase and our product release and upgrade schedules could be delayed.
|
•
|
Open source software is open to further development or modification by anyone. As a result, others may develop such software to be competitive with our platform and may make such competitive software available as open source. It is also possible for competitors to develop their own solutions using open source software, potentially reducing the demand for, and putting price pressure on, our solutions.
|
•
|
The licenses under which we license certain types of open source software may require that, if we modify the open source software we receive, we are required to make such modified software and other related proprietary software of ours publicly available without cost and on the same terms. Accordingly, we monitor our use of open source software in an effort to avoid subjecting our proprietary software to such conditions and others we do not intend. Although we believe that we have complied with our obligations under the various applicable licenses for open source software that we use, our processes used to monitor how open source software is used could be subject to error. In addition, there is little or no legal precedent governing the interpretation of terms in most of these licenses. Therefore, any improper usage of open source could result in unanticipated obligations regarding our solutions and technologies, which could have an adverse impact on our intellectual property rights and our ability to derive revenue from solutions incorporating the open source software.
|
•
|
If an author or other third party that distributes such open source software were to allege that we had not complied with the conditions of one or more of these licenses, we could be required to incur legal expenses defending against such allegations, or engineering expenses in developing a substitute solution.
|
•
|
price and volume fluctuations in the overall stock market from time to time;
|
•
|
volatility in the market prices and trading volumes of high technology stocks;
|
•
|
changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular;
|
•
|
changes in financial estimates by any analysts who follow our company, including as a result of our plan to transition our business toward a subscription-based model, or our failure to meet these estimates or the expectations of investors;
|
•
|
the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;
|
•
|
announcements by us or our competitors of new products or new or terminated significant contracts, commercial relationships or capital commitments;
|
•
|
public analyst or investor reaction to our press releases, other public announcements and filings with the SEC;
|
•
|
rumors and market speculation involving us or other companies in our industry;
|
•
|
actual or anticipated changes or fluctuations in our operating results;
|
•
|
actual or anticipated developments in our business or our competitors’ businesses or the competitive landscape generally;
|
•
|
actual or threatened litigation involving us, our industry or both, or investigations by regulators into our operations or those of our competitors;
|
•
|
developments or disputes concerning our intellectual property or our solutions, or third-party proprietary rights;
|
•
|
rumored, announced or completed acquisitions of businesses or technologies of or by us or our competitors;
|
•
|
new laws or regulations or new interpretations of existing laws or regulations applicable to our business;
|
•
|
changes in accounting standards, policies, guidelines, interpretations or principles;
|
•
|
any major changes in our management or our Board of Directors;
|
•
|
general economic conditions and slow or negative growth of our markets; and
|
•
|
other events or factors, including those resulting from war, incidents of terrorism or responses to these events.
|
•
|
our amended and restated certificate of incorporation provides for a dual class common stock structure for 17 years following the completion of our IPO;
|
•
|
a classified Board of Directors with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of our Board of Directors;
|
•
|
the ability of our Board of Directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
|
•
|
upon the conversion of our Class A common stock and Class B common stock into a single class of common stock, the exclusive right of our Board of Directors to elect a director to fill a vacancy created by the expansion of our Board of Directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our Board of Directors;
|
•
|
upon the conversion of our Class A common stock and Class B common stock into a single class of common stock, a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;
|
•
|
the requirement that a special meeting of stockholders may be called only by the chairman of our Board of Directors, our lead independent director, our president, our secretary or a majority vote of our Board of Directors, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;
|
•
|
the requirement for the affirmative vote of holders of at least 66 2⁄3% of the voting power of all of the then outstanding shares of the voting stock, voting together as a single class, to amend the provisions of our amended and restated certificate of incorporation relating to the issuance of preferred stock and management of our business or our amended and restated bylaws, which may inhibit the ability of an acquirer to effect such amendments to facilitate an unsolicited takeover attempt;
|
•
|
the ability of our Board of Directors, by majority vote, to amend our amended and restated bylaws, which may allow our Board of Directors to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend our amended and restated bylaws to facilitate an unsolicited takeover attempt; and
|
•
|
advance notice procedures with which stockholders must comply to nominate candidates to our Board of Directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of us.
|
|
|
Incorporated by Reference
|
|
|||
Number
|
Exhibit Title
|
Form
|
File No.
|
Exhibit
|
Filing
Date
|
Filed
Herewith
|
3.1
|
10-Q
|
001-37883
|
3.1
|
12/8/2016
|
|
|
3.2
|
S-1/A
|
333-208711
|
3.4
|
5/27/2016
|
|
|
10.1†
|
|
|
|
|
X
|
|
10.2
|
|
|
|
|
X
|
|
10.3†
|
|
|
|
|
X
|
|
10.4†
|
|
|
|
|
X
|
|
10.5
|
|
|
|
|
X
|
|
31.1
|
|
|
|
|
X
|
|
31.2
|
|
|
|
|
X
|
|
32.1*
|
|
|
|
|
X
|
|
32.2*
|
|
|
|
|
X
|
|
101.INS
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XRBL tags are embedded within the Inline XBRL document
|
|
|
|
|
X
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
X
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
X
|
101.
|
XBRL Taxonomy Extension Definition
|
|
|
|
|
X
|
101.
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
|
X
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
X
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
|
|
|
|
X
|
Date: December 5, 2019
|
|
/s/ Duston M. Williams
|
|
|
Duston M. Williams
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
1 Year Nutanix Chart |
1 Month Nutanix Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions