What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-11-29 compared with 2023-08-29 · 129 added, 118 removed, 571 unchanged (30% of the section changed)

2 unchanged sentences

(In thousands, except share and per share data)

January 31, 2023 July 31, 2023

January 31, 2023 October 31, 2023

Current assets

Cash and cash equivalents (VIE:

$ 2,019 and $ 1,081 at January 31, 2023 and July 31, 2023, respectively)

$ 2,019 and $ 2,555 at January 31, 2023 and October 31, 2023, respectively)

$ 82,036 $ 100,475

Accounts receivable, less allowances of $ 899 and $ 876 at January 31, 2023 and July 31, 2023, respectively

Accounts receivable, less allowances of $ 899 and $ 2,221 at January 31, 2023 and October 31, 2023, respectively

99,497 62,012

7 unchanged sentences

Intangible assets, net 152,825 121,695

Investments (related party $ 2,500 at January 31, 2023 and July 31, 2023)

Investments (related party $ 2,500 at January 31, 2023 and October 31, 2023)

Long-term prepaid expenses and other assets 8,101 1,656

5 unchanged sentences

Accrued expenses and other current liabilities 10,897 11,439

Deferred revenue, current portion 154,871 169,314

Deferred revenue 154,871 130,308

Financing obligations, current portion 1,015 1,429

10 unchanged sentences

Preferred stock, $ 0.001 par value;

10,000,000 shares authorized, and none issued and outstanding as of January 31, 2023 and July 31, 2023

10,000,000 shares authorized, and none issued and outstanding as of January 31, 2023 and October 31, 2023

Common stock, $ 0.0005 par value;

500,000,000 shares authorized as of January 31, 2023 and July 31, 2023;

111,424,132 and 112,661,660 shares issued and outstanding as of January 31, 2023 and July 31, 2023, respectively

500,000,000 shares authorized as of January 31, 2023 and October 31, 2023;

111,424,132 and 113,030,730 shares issued and outstanding as of January 31, 2023 and October 31, 2023, respectively

Additional paid-in capital 1,333,669 1,382,019

6 unchanged sentences

(In thousands, except share and per share data)

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

16 unchanged sentences

Interest expense ( 580 ) ( 854 ) ( 1,849 ) ( 3,277 )

Other income (expense), net ( 1,014 ) 469 ( 2,587 ) ( 313 )

Other expense, net ( 2,911 ) ( 2,320 ) ( 5,498 ) ( 2,633 )

Loss before income taxes ( 21,848 ) ( 15,395 ) ( 77,913 ) ( 40,180 )

14 unchanged sentences

(In thousands)

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

13 unchanged sentences

(In thousands, except share data)

Three Months Ended July 31, 2022

Three Months Ended October 31, 2022

Common Stock Additional

4 unchanged sentences

Shares Amount

Balance, April 30, 2022 110,128,561 $ 55 $ 1,290,295 $ 762 $ ( 239,275 ) $ 1,051,837

Balance, July 31, 2022 110,616,050 $ 55 $ 1,306,339 $ 1,219 $ ( 266,392 ) $ 1,041,221

Exercise of stock options 145,753 — 1,182 — — 1,182

Stock issuance upon vesting of restricted stock units 181,766 — — — — —

Stock issuance under the employee stock purchase plan 92,236 — 2,424 — — 2,424

Stock-based compensation — — 12,499 — — 12,499

1 unchanged sentence

Net loss attributable to nCino, Inc., including adjustment to redeemable non-controlling interest — — ( 1,191 ) — ( 22,388 ) ( 23,579 )

Balance, July 31, 2022 110,616,050 $ 55 $ 1,306,339 $ 1,219 $ ( 266,392 ) $ 1,041,221

Three Months Ended July 31, 2023

Balance, October 31, 2022 110,943,569 $ 55 $ 1,318,829 $ 1,758 $ ( 288,780 ) $ 1,031,862

Three Months Ended October 31, 2023

Common Stock Additional

4 unchanged sentences

Shares Amount

Balance, April 30, 2023 112,200,481 $ 56 $ 1,346,250 $ 818 $ ( 321,705 ) $ 1,025,419

Balance, July 31, 2023 112,661,660 $ 56 $ 1,364,757 $ 844 $ ( 337,516 ) $ 1,028,141

Exercise of stock options 106,772 1 967 — — 968

Stock issuance upon vesting of restricted stock units 262,298 — — — — —

Stock issuance under the employee stock purchase plan 120,084 — 2,698 — — 2,698

Stock-based compensation — — 15,817 — — 15,817

1 unchanged sentence

Net loss attributable to nCino, Inc., including adjustment to redeemable non-controlling interest — — 478 — ( 16,857 ) ( 16,379 )

Balance, July 31, 2023 112,661,660 $ 56 $ 1,364,757 $ 844 $ ( 337,516 ) $ 1,028,141

Balance, October 31, 2023 113,030,730 $ 57 $ 1,382,019 $ 906 $ ( 354,373 ) $ 1,028,609

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements .

1 unchanged sentence

(In thousands, except share data)

Six Months Ended July 31, 2022

Nine Months Ended October 31, 2022

Common Stock Additional

11 unchanged sentences

Net loss attributable to nCino, Inc., including adjustment to redeemable non-controlling interest — — ( 2,348 ) — ( 79,164 ) ( 81,512 )

Balance, July 31, 2022 110,616,050 $ 55 $ 1,306,339 $ 1,219 $ ( 266,392 ) $ 1,041,221

Six Months Ended July 31, 2023

Balance, October 31, 2022 110,943,569 $ 55 $ 1,318,829 $ 1,758 $ ( 288,780 ) $ 1,031,862

Nine Months Ended October 31, 2023

Common Stock Additional

11 unchanged sentences

Net loss attributable to nCino, Inc., including adjustment to redeemable non-controlling interest — — 526 — ( 44,032 ) ( 43,506 )

Balance, July 31, 2023 112,661,660 $ 56 $ 1,364,757 $ 844 $ ( 337,516 ) $ 1,028,141

Balance, October 31, 2023 113,030,730 $ 57 $ 1,382,019 $ 906 $ ( 354,373 ) $ 1,028,609

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements .

1 unchanged sentence

(In thousands)

Six Months Ended July 31,

Nine Months Ended October 31,

Cash flows from operating activities

11 unchanged sentences

Provision for bad debt 323 1,124

Net foreign currency losses (gains) 2,635 ( 38 )

Loss on disposal of property and equipment — 144

Net foreign currency losses 5,608 2,275

Loss on disposal of long-lived assets — 161

Change in operating assets and liabilities:

8 unchanged sentences

Cash flows from investing activities

Acquisition of business, net of cash acquired 676 —

Acquisition of assets ( 563 ) ( 356 )

Purchases of property and equipment ( 13,889 ) ( 3,083 )

Purchase of investment — ( 2,500 )

Net cash used in investing activities ( 13,776 ) ( 5,939 )

Cash flows from financing activities

Investment from redeemable non-controlling interest — 983

Proceeds from borrowings on revolving credit facility 50,000 —

19 unchanged sentences

Purchase of property and equipment, accrued but not paid $ 14,765 $ 200

Receivables from exercise of stock options $ — $ 4

Net working capital receivable adjustment $ 676 $ —

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements .

19 unchanged sentences

commenced using nCino OpCo's trading history under the ticker symbol "NCNO".

On September 8, 2023, SimpleNexus began operating as SimpleNexus, LLC d/b/a nCino Mortgage, LLC ("nCino Mortgage").

Description of Business:

17 unchanged sentences

as it has the power over the activities that most significantly impact the economic performance of nCino K.K.

and has the obligation to absorb expected losses and the right to receive expected benefits that could be significant to nCino K.K., in accordance with accounting guidance.

As a result, the Company consolidated nCino K.K.

and all significant intercompany accounts have been eliminated.

The Company will continue to assess whether it has a controlling financial interest and whether it is the primary beneficiary at

and has the obligation to absorb expected

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

each reporting period.

Other than the Company’s equity investment, the Company has not provided financial or other support to nCino K.K.

losses and the right to receive expected benefits that could be significant to nCino K.K., in accordance with accounting guidance.

As a result, the Company consolidated nCino K.K.

and all significant intercompany accounts have been eliminated.

The Company will continue to assess whether it has a controlling financial interest and whether it is the primary beneficiary at each reporting period.

Other than the Company’s equity investments, the Company has not provided financial or other support to nCino K.K.

that it was not contractually obligated to provide.

22 unchanged sentences

Actual results could differ from these estimates.

See Note 7 "Goodwill and Intangible Assets" for a change in estimate for the useful life of the SimpleNexus trade name.

Concentration of Credit Risk and Significant Customers:

The Company’s financial instruments that are exposed to concentration of credit risk consist primarily of cash, cash equivalents, restricted cash and accounts receivable.

The Company’s cash and cash equivalents exceeded federally insured limits at January 31, 2023 and July 31, 2023.

The Company’s cash and cash equivalents exceeded federally insured limits at January 31, 2023 and October 31, 2023.

The Company maintains its cash, cash equivalents and restricted cash with high-credit-quality financial institutions.

As of January 31, 2023, no individual customer represented over 10% of accounts receivable and, as of July 31, 2023, one individual customer represented 10.5 % of accounts receivable.

For the three and six months ended July 31, 2022 and 2023, no individual customer represented more than 10% of the Company’s total revenues.

As of January 31, 2023 and October 31, 2023, no individual customer represented over 10% of accounts receivable.

For the three and nine months ended October 31, 2022 and 2023, no individual customer represented more than 10% of the Company’s total revenues.

Restricted Cash:

1 unchanged sentence

The remaining restricted cash consists of deposits held as collateral for the Company's bank guarantees issued in place of security deposits for certain property leases and credit cards.

Restricted cash is included in prepaid expenses and other current assets and other long-term assets at January 31, 2023 and July 31, 2023 on the unaudited condensed consolidated balance sheets.

Restricted cash is included in other long-term assets at January 31, 2023 and in prepaid expenses and other current assets and other long-term assets at October 31, 2023 on the unaudited condensed consolidated balance sheets.

Accounts Receivable and Allowances:

2 unchanged sentences

Certain performance obligations may require payment before delivery of the service to the customer.

The Company recognizes a contract asset in the form of accounts receivable when the Company has an unconditional right to payment, and the Company records a contract asset in the form of unbilled accounts receivable when revenues earned on a contract exceeds the billings.

The Company’s standard billing terms are annual in advance, while SimpleNexus' standard billing terms are monthly in advance.

An unbilled accounts receivable is a contract asset related to the delivery of the Company’s subscription services and professional services for which the related billings will occur in a future period.

Unbilled accounts receivable consists of (i) revenues recognized for professional services

The Company recognizes a contract asset in the form of accounts receivable when the Company has an unconditional right to payment, and the Company records a contract asset in the form of

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

performed but not yet billed and (ii) revenues recognized from non-cancelable, multi-year orders in which fees increase annually but for which the Company is not contractually able to invoice until a future period.

unbilled accounts receivable when revenues earned on a contract exceeds the billings.

The Company’s standard billing terms are annual in advance, while nCino Mortgage's standard billing terms are monthly in advance.

Unbilled accounts receivable consists of (i) revenues recognized for professional services performed but not yet billed and (ii) revenues recognized from non-cancelable, multi-year orders in which fees increase annually but for which the Company is not contractually able to invoice until a future period.

Accounts receivable are reported at their gross outstanding balance reduced by an allowance for estimated receivable losses, which includes allowances for doubtful accounts and a reserve for expected credit losses.

3 unchanged sentences

A summary of activity in the allowance for doubtful accounts is as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

1 unchanged sentence

Charged to bad debt expense 169 368 323 1,124

Charged to deferred revenue — 981 — 923

Write-offs and other ( 116 ) — ( 116 ) ( 721 )

12 unchanged sentences

In October 2019, the Company initially contributed $ 4.7 million in cash in exchange for 51 % of the outstanding common stock of nCino K.K.

As of July 31, 2023, the Company controls a majority of the outstanding common stock in nCino K.K.

As of October 31, 2023, the Company controls a majority of the outstanding common stock in nCino K.K.

In October 2023, the Company made a further investment in nCino K.K.

of $ 1.0 million that, including additional investments in nCino K.K.

of $ 1.0 million by exiting third-party investors in October 2023, maintained the Company's ownership of 51 %.

All of the common stock held by the Investors is callable by the Company or puttable by the Investors at the option of the Investors or at the option of the Company beginning on the eighth anniversary of the agreement with the Investors.

3 unchanged sentences

are classified outside of permanent equity in the Company’s unaudited condensed consolidated balance sheets.

The estimated redemption value of the call/put option embedded in the redeemable non-controlling interest was $ 3.2 million at July 31, 2023.

The estimated redemption value of the call/put option embedded in the redeemable non-controlling interest was $ 2.8 million at October 31, 2023.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 unchanged sentence

The following table summarizes the activity in the redeemable non-controlling interests for the period indicated below:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

Balance, beginning of period $ 3,219 $ 2,995 $ 2,882 $ 3,589

Investment by redeemable non-controlling interest — 983 — 983

Net loss attributable to redeemable non-controlling interest (excluding adjustment to non-controlling interest) ( 257 ) ( 320 ) ( 908 ) ( 868 )

10 unchanged sentences

Significant unobservable inputs which are supported by little or no market activity.

The carrying amounts of cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value as of January 31, 2023 and July 31, 2023 because of the relatively short duration of these instruments.

The carrying amounts of cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value as of January 31, 2023 and October 31, 2023 because of the relatively short duration of these instruments.

The carrying amount of any outstanding borrowings on the Company's revolving credit facility approximates fair value due to the variable interest rates of the borrowings.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

The Company evaluated its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period.

The following table summarizes the Company’s financial assets measured at fair value as of January 31, 2023 and July 31, 2023 and indicates the fair value hierarchy of the valuation:

The following table summarizes the Company’s financial assets measured at fair value as of January 31, 2023 and October 31, 2023 and indicates the fair value hierarchy of the valuation:

Fair value measurements on a recurring basis as of January 31, 2023

3 unchanged sentences

Total assets $ 17,531 $ — $ —

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Fair value measurements on a recurring basis as of July 31, 2023

Fair value measurements on a recurring basis as of October 31, 2023

Level 1 Level 2 Level 3

Money market accounts (included in cash and cash equivalents) $ 54,491 $ — $ —

Time deposits (included in prepaid expenses and other current assets) 162 — —

Time deposits (included in other long-term assets) 348 — —

3 unchanged sentences

The Company's assets measured at fair value on a nonrecurring basis include the investments accounted for under the measurement alternative.

There was no adjustment or impairment recognized for the three and six months ended July 31, 2022 and 2023, respectively.

There was no adjustment or impairment recognized for the three and nine months ended October 31, 2022 and 2023, respectively.

Revenues by Geographic Area

Revenues by geographic region were as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

5 unchanged sentences

No country outside the United States represented 10% or more of total revenues.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Contract Amounts

Accounts Receivable

Accounts receivable, less allowance for doubtful accounts, is as follows as of January 31, 2023 and July 31, 2023:

As of January 31, 2023 As of July 31, 2023

Accounts receivable, less allowance for doubtful accounts, is as follows as of January 31, 2023 and October 31, 2023:

As of January 31, 2023 As of October 31, 2023

Trade accounts receivable $ 94,729 $ 57,112

3 unchanged sentences

Total accounts receivable, net $ 99,497 $ 62,012

1 Includes $ 0.1 million and $ 0.3 million income tax receivable of as of January 31, 2023 and July 31, 2023, respectively.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

1 Includes $ 0.1 million income tax receivable as of January 31, 2023 and October 31, 2023.

Deferred Revenue and Remaining Performance Obligations

Significant movements in the deferred revenue balance during the period consisted of increases due to payments received or due in advance prior to the transfer of control of the underlying performance obligations to the customer, which were offset by decreases due to revenues recognized in the period.

During the six months ended July 31, 2023, $ 117.2 million of revenues were recognized out of the deferred revenue balance as of January 31, 2023.

During the nine months ended October 31, 2023, $ 149.9 million of revenues were recognized out of the deferred revenue balance as of January 31, 2023.

Transaction price allocated to remaining performance obligations represents contracted revenues that have not yet been recognized, which includes both deferred revenue and amounts that will be invoiced and recognized as revenues in future periods.

1 unchanged sentence

The Company applies practical expedients to exclude amounts related to performance obligations that are billed and recognized as they are delivered, optional purchases that do not represent material rights, and any estimated amounts of variable consideration that are subject to constraint.

Remaining performance obligations were $ 928.6 million as of July 31, 2023.

Remaining performance obligations were $ 917.1 million as of October 31, 2023.

The Company expects to recognize approximately 68 % of its remaining performance obligation as revenues in the next 24 months, approximately 28 % more in the following 25 to 48 months, and the remainder thereafter.

1 unchanged sentence

Property and equipment, net consisted of the following:

As of January 31, 2023 As of July 31, 2023

As of January 31, 2023 As of October 31, 2023

Furniture and fixtures $ 10,730 $ 12,047

8 unchanged sentences

1 See Note 12 "Commitments and Contingencies."

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

The Company recognized depreciation expense as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

5 unchanged sentences

Total depreciation expense $ 1,508 $ 2,088 $ 4,329 $ 6,236

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Goodwill and Intangible Assets

2 unchanged sentences

Translation adjustments ( 855 )

Balance, July 31, 2023 $ 839,042

Balance, October 31, 2023 $ 838,585

Intangible assets

Intangible assets, net are as follows:

As of January 31, 2023 As of July 31, 2023

As of January 31, 2023 As of October 31, 2023

Amount Accumulated

8 unchanged sentences

The Company recognized amortization expense for intangible assets as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

3 unchanged sentences

Total amortization expense $ 7,068 $ 16,952 $ 21,129 $ 31,101

The expected future amortization expense for intangible assets as of July 31, 2023 is as follows:

During the third quarter of fiscal 2024, the Company rebranded the SimpleNexus solution to nCino Mortgage, resulting in a change to the trade name useful life.

As a result, the Company recorded accelerated amortization to fully amortize the remaining trade name intangible asset.

The effect of this change in estimate for the three and nine months ended October 31,

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

2023 was an increase in sales and marketing amortization expense of $ 10.1 million, which resulted in an increase in loss of operations and net loss attributable to nCino, Inc.

of $ 10.1 million, or $ 0.09 per basic and diluted share.

The expected future amortization expense for intangible assets as of October 31, 2023 is as follows:

Fiscal Year Ending January 31,

3 unchanged sentences

Actual amounts of amortization expense may differ from estimated amounts due to additional intangible asset acquisitions, changes in foreign currency exchange rates, impairment of intangible assets, future changes to expected asset lives of intangible assets, and other events.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Stockholders’ Equity

At July 31, 2023, the Company committed a total of 35,202,345 shares of common stock for future issuance as follows:

At October 31, 2023, the Company committed a total of 34,833,275 shares of common stock for future issuance as follows:

Issued and outstanding stock options 1,551,058

3 unchanged sentences

Stock Options

Stock option activity for the six months ended July 31, 2023 was as follows:

Stock option activity for the nine months ended October 31, 2023 was as follows:

Shares Weighted

3 unchanged sentences

Exercised ( 447,440 ) 7.10

Outstanding, July 31, 2023 1,664,830 $ 6.62

Exercisable, July 31, 2023 1,655,080 $ 6.53

Fully vested or expected to vest, July 31, 2023 1,663,855 $ 6.61

Outstanding, October 31, 2023 1,551,058 $ 6.42

Exercisable, October 31, 2023 1,548,183 $ 6.39

Fully vested or expected to vest, October 31, 2023 1,550,771 $ 6.41

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Restricted Stock Units

RSU activity during the six months ended July 31, 2023 was as follows:

RSU activity during the nine months ended October 31, 2023 was as follows:

Shares Weighted Average

4 unchanged sentences

Forfeited ( 311,696 ) 39.81

Nonvested, July 31, 2023 5,784,062 $ 33.75

As of July 31, 2023, total unrecognized compensation expense related to non-vested RSUs was $ 162.7 million, adjusted for estimated forfeitures, based on the estimated fair value of the Company’s common stock at the time of grant.

Nonvested, October 31, 2023 5,785,669 $ 33.89

As of October 31, 2023, total unrecognized compensation expense related to non-vested RSUs was $ 155.3 million, adjusted for estimated forfeitures, based on the estimated fair value of the Company’s common stock at the time of grant.

That cost is expected to be recognized over a weighted average period of 2.90 years.

2 unchanged sentences

Thereafter, offering periods begin each year on January 1 and July 1.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

The fair value of ESPP shares during the six months ended July 31, 2022 and 2023 was estimated at the date of grant using the Black-Scholes option valuation model based on assumptions as follows for ESPP awards:

Six Months Ended July 31,

The fair value of ESPP shares during the nine months ended October 31, 2022 and 2023 was estimated at the date of grant using the Black-Scholes option valuation model based on assumptions as follows for ESPP awards:

Nine Months Ended October 31,

Expected life (in years) 0.50 0.50

6 unchanged sentences

Total stock-based compensation expense included in our unaudited condensed consolidated statements of operations were as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

5 unchanged sentences

Total stock-based compensation expense $ 12,505 $ 15,823 $ 38,476 $ 41,969

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Operating Leases

1 unchanged sentence

The components of lease expense were as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

Operating lease expense $ 1,023 $ 1,225 $ 2,961 $ 3,842

Short-term lease expense 259 473 540 934

Variable lease expense 269 464 809 1,398

Short-term lease expense 124 94 378 328

Total $ 1,416 $ 1,783 $ 4,148 $ 5,568

Supplemental cash flow information related to operating leases were as follows:

Six Months Ended July 31,

Nine Months Ended October 31,

Cash paid for amounts included in the measurement of operating lease liabilities $ 3,079 $ 3,324

Operating right-of-use assets obtained in exchange for operating lease liabilities 1,989 2,142

The weighted-average remaining lease term and weighted-average discount rate for the Company's operating lease liabilities as of July 31, 2023 were 3.32 years and 4.5 %, respectively.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Future minimum lease payments as of July 31, 2023 were as follows:

Operating right-of-use assets and operating lease liabilities disposed of — 115

The weighted-average remaining lease term and weighted-average discount rate for the Company's operating lease liabilities as of October 31, 2023 were 3.25 years and 4.7 %, respectively.

Future minimum lease payments as of October 31, 2023 were as follows:

Fiscal Year Ending January 31, Operating Leases

6 unchanged sentences

Long-term lease obligations $ 6,460

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Revolving Credit Facility

13 unchanged sentences

Consolidated Liquidity is measured as the sum of 100 % of unrestricted and unencumbered cash of the Company and its domestic subsidiaries, 75 % of unrestricted and unencumbered cash of the Company’s foreign subsidiaries and the lesser of Credit Facility availability and $ 25.0 million.

The Company is also required to maintain at least $ 5.0 million of the Company's cash and/or marketable securities with the Lender which is considered restricted cash and is included in other long-term assets as of January 31, 2023 and prepaid expenses and other current assets as of July 31, 2023 on the Company's unaudited condensed consolidated balance sheets.

The Company is also required to maintain at least $ 5.0 million of the Company's cash and/or marketable securities with the Lender which is considered restricted cash and is included in other long-term assets as of January 31, 2023 and prepaid expenses and other current assets as of October 31, 2023 on the Company's unaudited condensed consolidated balance sheets.

The Credit Facility is guaranteed by the Company and each of its current and future material domestic subsidiaries (the “Guarantors”) and secured by substantially all of the personal property, subject to customary exceptions, of the Borrower and the Guarantors, in each case, now owned or later acquired, including a pledge of all of the Borrower’s capital stock, the capital stock of all of the Company’s domestic subsidiaries, and 65 % of the capital stock of foreign subsidiaries that are directly owned by the Borrower or a Guarantor.

The Company had $ 30.0 million and $ 0.0 million outstanding and no letters of credit issued under the Credit Facility and was in compliance with all covenants as of January 31, 2023 and July 31, 2023, respectively.

The available borrowing capacity under the Credit Facility was $ 50.0 million as of July 31, 2023.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

The available borrowing capacity under the Credit Facility was $ 50.0 million as of October 31, 2023.

Commitments and Contingencies

6 unchanged sentences

As a result, the Company did not meet the criteria to apply sale-leaseback accounting and therefore, recorded an asset and corresponding financing obligation for $ 16.3 million at inception of that lease.

The fair value of the leased property and corresponding financing obligation are included in property and equipment, net and financing obligations on the unaudited condensed consolidated balance sheets, respectively.

The fair value of the leased property and corresponding

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

financing obligation are included in property and equipment, net and financing obligations on the unaudited condensed consolidated balance sheets, respectively.

In January 2021, the Company entered into an amendment to its November 2020 headquarters lease to provide for construction of a parking deck, which upon completion was subject to exclusive use by the Company.

7 unchanged sentences

The leases will be analyzed for applicable lease accounting upon expiration of the purchase option, if not exercised.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Purchase commitments and future minimum lease payments required under financing obligations as of July 31, 2023 is as follows:

Purchase commitments and future minimum lease payments required under financing obligations as of October 31, 2023 is as follows:

Fiscal Year Ending January 31, Purchase commitments Financing obligations - leased facility

8 unchanged sentences

A portion of the associated lease payments are recognized as interest expense and the remainder reduces the financing obligations.

The weighted-average discount rate for the Company's financing obligations as of July 31, 2023 was 5.7 %.

The weighted-average discount rate for the Company's financing obligations as of October 31, 2023 was 5.7 %.

Indemnification

3 unchanged sentences

To date, the Company has not incurred any material costs as a result of such obligations and has not accrued any material liabilities related to such obligations in the accompanying unaudited condensed consolidated financial statements.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Legal Proceedings

14 unchanged sentences

While the Company strongly believes that it would prevail on the merits and that it has not violated the antitrust laws, in order to avoid the distraction and expense of protracted litigation and instead continue to focus on its employees and customers, the Company agreed to settle this matter.

The Company has accrued for the proposed

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

settlement agreement which is included in accrued expenses and other current liabilities as of July 31, 2023 on the Company's unaudited condensed consolidated balance sheets.

The Company has accrued for the proposed settlement agreement which is included in accrued expenses and other current liabilities as of October 31, 2023 on the Company's unaudited condensed consolidated balance sheets.

On September 26, 2022, a purported stockholder of the Company filed a complaint in the Delaware Court of Chancery in connection with the series of mergers in which the Company became the parent of nCino OpCo and SimpleNexus.

16 unchanged sentences

The Company accrues for any assessments if deemed probable and estimable.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Related-Party Transactions

On November 1, 2022, the Company's wholly-owned subsidiary, nCino OpCo, acquired preferred shares of ZestFinance, Inc.

(d/b/a ZEST AI) ("Zest AI"), a private company, for $ 2.5 million and is included in investments as of January 31, 2023 and July 31, 2023 on the Company's unaudited condensed consolidated balance sheets.

(d/b/a ZEST AI) ("Zest AI"), a private company, for $ 2.5 million and is included in investments as of January 31, 2023 and October 31, 2023 on the Company's unaudited condensed consolidated balance sheets.

The investment is considered a related party transaction as entities affiliated with Insight Partners, a beneficial owner of the Company, own greater than ten percent of Zest AI.

5 unchanged sentences

The dilutive effect of outstanding awards is reflected in diluted earnings per share by application of the treasury stock method.

Diluted loss per share for the three months ended July 31, 2022 and 2023 and for the six months ended July 31, 2022 and 2023 is the same as the basic loss per share as there was a net loss for those periods, and inclusion of potentially issuable shares was anti-dilutive.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

Diluted loss per share for the three months ended October 31, 2022 and 2023 and for the nine months ended October 31, 2022 and 2023 is the same as the basic loss per share as there was a net loss for those periods, and inclusion of potentially issuable shares was anti-dilutive.

The components of basic and diluted loss per share for periods presented are as follows (in thousands, except share and per share data):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2022 2023 2022 2023

6 unchanged sentences

The following potential outstanding common stock were excluded from the diluted loss per share computation because the effect would have been anti-dilutive:

Six Months Ended July 31,

Nine Months Ended October 31,

Stock options issued and outstanding 2,161,088 1,551,058

5 unchanged sentences

The Company paid $ 0.8 million in the fourth quarter of fiscal 2023 to exercise an early termination clause to exit a facility during fiscal 2024, which was accounted for as a lease modification.

The Company incurred charges in the in the fourth quarter of the Company’s fiscal 2023 of $ 4.8 million in connection with the restructuring plan.

The accrual for severance and related benefit costs of $ 5.0 million for terminated employees was included in accrued compensation and benefits on the consolidated balance sheets as of January 31, 2023 and was paid in the first quarter of the Company’s fiscal 2024.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts and unless otherwise indicated)

The Company’s restructuring charges for the three and six months ended July 31, 2023 were as follows:

The Company incurred charges in the in the fourth quarter of the Company’s fiscal 2023 of $ 4.8 million in connection with the restructuring plan.

The Company’s restructuring charges for the three and nine months ended October 31, 2023 were as follows:

Three Months Ended

July 31, 2023 Six Months Ended

July 31, 2023

October 31, 2023 Nine Months Ended

October 31, 2023

Lease exit fees 1

6 unchanged sentences

1 These expenses reduced operating lease right-of-use assets on the unaudited condensed consolidated balance sheets .

The Company had no restructuring charges for the three and six months ended July 31, 2022.

The Company had no restructuring charges for the three and nine months ended October 31, 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements