What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-03-26 compared with 2023-03-29 · 124 added, 136 removed, 405 unchanged (39% of the section changed)

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A discussion regarding our financial condition and results of operations for the fiscal year ended January 31, 2023 compared to the fiscal year ended January 31, 2022 can be found in “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended January 31, 2023 filed with the SEC on March 29, 2023.

We believe in a data connected world where organizations have seamless access to explore, share, and unlock the value of data.

We believe that a cloud computing platform that puts data and AI at its core will offer great benefits to organizations by allowing them to realize the value of the data that powers their businesses.

By offering rich primitives for data and applications, we believe that we can create a data connected world where organizations have seamless access to explore, share, and unlock the value of data.

To realize this vision, we deliver the Data Cloud, a network where Snowflake customers, partners, developers, data providers, and data consumers can break down data silos and derive value from rapidly growing data sets in secure, governed, and compliant ways.

Our platform is the innovative technology that powers the Data Cloud, enabling customers to consolidate data into a single source of truth to drive meaningful business insights, build data applications, and share data and data products.

Our platform is the innovative technology that powers the Data Cloud, enabling customers to consolidate data into a single source of truth to drive meaningful insights, apply AI to solve business problems, build data applications, and share data and data products.

We provide our platform through a customer-centric, consumption-based business model, only charging customers for the resources they use.

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For data transfer resources, consumption fees are based on terabytes of data transferred, the public cloud provider used, and the region to and from which the transfer is executed.

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Our customers typically enter into capacity arrangements with a term of one to four years, or consume our platform under on-demand arrangements in which we charge for use of our platform monthly in arrears.

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For these reasons, we believe our deferred revenue is not a meaningful indicator of future revenue that will be recognized in any given time period.

Our go-to-market strategy is focused on acquiring new customers and driving continued use of our platform for existing customers.

Our go-to-market strategy is focused on acquiring new customers and driving increased use of our platform for existing customers.

We primarily focus our selling efforts on large organizations and primarily sell our platform through a direct sales force, which targets technical and business leaders who are adopting a cloud strategy and leveraging data to improve their business performance.

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Impact of Macroeconomic Conditions

Our business and financial condition have been, and may continue to be, impacted by adverse macroeconomic conditions, including higher inflation, higher interest rates, and fluctuations or volatility in capital markets or foreign currency exchange rates, which are causing customers to optimize consumption, rationalize budgets, and prioritize cash flow management (including through shortened contract duration).

Our business and financial condition have been, and may continue to be, impacted by adverse macroeconomic conditions, including inflation, higher interest rates, and fluctuations or volatility in capital markets or foreign currency exchange rates.

These conditions have caused, and may continue to cause, customers to rationalize budgets, prioritize cash flow management, including through shortened contract duration, and optimize consumption, including by reducing storage through shorter data retention policies.

We are continuing to monitor the actual and potential effects of general macroeconomic conditions across our business.

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In February 2023, our board of directors authorized a stock repurchase program of up to $2.0 billion of our outstanding common stock.

Repurchases may be effected, from time to time, either on the open market (including via pre-set trading plans), in privately negotiated transactions, or through other transactions in accordance with applicable securities laws.

The program is funded using our working capital and will expire in March 2025.

During the fiscal year ended January 31, 2024, we repurchased approximately 4.0 million shares of our outstanding common stock for an aggregate purchase price of $591.7 million, including transaction costs, at a weighted-average price of $147.50 per share.

All repurchases were made in open market transactions (including via pre-set trading plans).

As of January 31, 2024, $1.4 billion remained available for future repurchases under the stock repurchase program.

See Note 11, “Equity,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

The timing and amount of any repurchases will be determined by management based on an evaluation of market conditions and other factors.

The program does not obligate us to acquire any particular amount of common stock and the repurchase program may be suspended or discontinued at any time at our discretion.

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Business Combinations

On March 31, 2022, we acquired all outstanding stock of Streamlit, Inc.

(Streamlit), a privately-held company which provides an open-source framework for creating and deploying data applications.

The acquisition date fair value of the purchase consideration was $650.8 million, which was comprised of $211.8 million in cash and 1.9 million shares of our common stock valued at $438.9 million as of the acquisition date.

In addition, we issued to Streamlit’s three founders a total of 0.4 million shares of our common stock in exchange for a portion of their Streamlit stock.

These shares are subject to vesting agreements pursuant to which the shares will vest over three years, subject to each founder’s continued employment with us.

The $93.7 million fair value of these shares are accounted for as post-combination stock-based compensation over the requisite service period of three years.

On September 23, 2022, we acquired all outstanding stock of Applica Sp.

(Applica), a privately-held company which provides an artificial intelligence platform for document understanding, for $174.7 million in cash.

During the three months ended January 31, 2024, we acquired all outstanding stock of Samooha, Inc.

(Samooha), a privately-held company which developed data clean room technology that enabled multiple parties to securely collaborate on sensitive data.

The acquisition date fair value of the preliminary purchase consideration was $219.0 million, which was primarily comprised of 0.9 million shares of our common stock valued at $174.2 million as of the acquisition date, $38.8 million fair value of our previously held equity interest in Samooha, and $6.0 million in cash and deferred cash consideration.

In addition, we issued to certain of Samooha’s employees a total of 0.4 million shares of our common stock in exchange for a portion of their Samooha stock.

These shares are subject to vesting agreements pursuant to which the shares will vest over four years, subject to each of these employees’ continued employment with the Company or its affiliates.

The $74.8 million fair value of these shares is accounted for as post-combination stock-based compensation over the requisite service period of four years.

During the three months ended July 31, 2023, we acquired all outstanding stock of Neeva Inc.

and its equity investee (collectively, Neeva), a privately-held company which developed search technology powered by artificial intelligence language models, for $185.4 million in cash.

During the three months ended April 30, 2023, we acquired (i) all outstanding stock of Mountain US Corporation (formerly known as Mobilize.Net Corporation) (Mountain), a privately-held company which provided a suite of tools for efficiently migrating databases to the Data Cloud, for $76.3 million in cash, and (ii) all outstanding stock of LeapYear Technologies, Inc.

(LeapYear), a privately-held company which provided a differential privacy platform, for $62.0 million in cash.

The results of operations of these business combinations have been included in our consolidated financial statements from the respective dates of acquisition.

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Adoption of our Platform and Expansion of the Data Cloud

Our future success depends in large part on the market adoption of our platform.

Our future success depends in large part on the market adoption of our platform, including new product functionality such as Snowpark.

While we see growing demand for our platform, particularly from large enterprises, many of these organizations have invested substantial technical, financial, and personnel resources in their legacy database products or big data offerings, despite their inherent limitations.

In addition, many customers are attempting to rationalize budgets, prioritize cash flow management, and optimize consumption amidst macroeconomic uncertainty.

While this makes it difficult to predict customer adoption rates and future demand, we believe that the benefits of our platform put us in a strong position to capture the significant market opportunity ahead.

Our platform powers the Data Cloud, a network of data providers, data consumers, and data application developers that enables our customers to securely share, monetize, and acquire live data sets and data products.

The Data Cloud includes access to Snowflake Marketplace, through which customers can access or acquire third-party data sets and other data products.

Our future growth will be increasingly dependent on our ability to increase consumption of our platform by building and expanding the Data Cloud.

The Data Cloud includes access to the Snowflake Marketplace, through which customers can access or acquire third-party data sets, data applications, and other data products.

Our future growth is increasingly dependent on our ability to increase consumption of our platform by building and expanding the Data Cloud.

Expanding Within our Existing Customer Base

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We plan to continue investing to encourage increased consumption and adoption of new use cases among our existing customers, particularly large enterprises.

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Once deployed, our customers often expand their use of our platform more broadly within the enterprise and across their ecosystem of customers and partners as they migrate more data to the public cloud, identify new use cases, and realize the benefits of our platform and the Data Cloud.

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New software releases or hardware improvements, like better storage compression and cloud infrastructure processor improvements, may make our platform more efficient, enabling customers to consume fewer compute, storage, and data transfer resources to accomplish the same workloads.

In addition, new product features allow customers to use our platform to provide compute services without requiring them to store data.

To the extent these improvements do not result in an offsetting increase in new workloads, we may experience lower revenue.

In addition, we have recently seen, and may continue to see, our newer customers increase their consumption of our platform at a slower pace than our more tenured customers.

Our ability to increase usage of our platform by, and sell additional contracted capacity to, existing customers, and, in particular, large enterprise customers, will depend on a number of factors, including our customers’ satisfaction with our platform, competition, pricing, economic conditions, overall changes in our customers’ spending levels, the effectiveness of our and our partners’ efforts to help our customers realize the benefits of our platform, and the extent to which customers migrate new workloads to our platform over time.

Our ability to increase usage of our platform by, and sell additional contracted capacity to, existing customers, and, in particular, large enterprise customers, will depend on a number of factors, including our customers’ satisfaction with our platform, competition, pricing, macroeconomic conditions, overall changes in our customers’ spending levels, customers’ attempts to optimize their consumption, the effectiveness of our and our partners’ efforts to help our customers realize the benefits of our platform, and the extent to which customers migrate new workloads to our platform over time, including data science, artificial intelligence, and machine learning workloads.

Acquiring New Customers

We believe there is a substantial opportunity to further grow our customer base by continuing to make significant investments in sales and marketing and brand awareness.

Our ability to attract new customers will depend on a number of factors, including our success in recruiting and scaling our sales and marketing organization, competitive dynamics in our target markets, changes in our customers’ spending in response to market uncertainty, and our ability to build and maintain partner relationships, including with global system integrators, resellers, and technology partners.

We intend to continue expanding our direct sales force, with a focus on specific industries and increasing sales to large organizations.

While our platform is built for organizations of all sizes, we focus our selling efforts on large enterprise customers and customers with vast amounts of data, and providing industry-specific solutions.

We may not achieve anticipated revenue growth from expanding our sales force to focus on large enterprises and specific industries if we are unable to hire, develop, integrate, and retain talented and effective sales personnel;

if our new and existing sales personnel are unable to achieve desired productivity levels in a reasonable period of time;

Our ability to attract new customers will depend on a number of factors, including the productivity of our sales organization, competitive dynamics in our target markets, changes in our customers’ spending and platform consumption in response to market uncertainty, and our ability to build and maintain partner relationships, including with global system integrators, resellers, technology partners, and third-party providers of native applications on the Snowflake Marketplace.

While our platform is built for organizations of all sizes, we focus our selling efforts on large enterprise customers, customers with vast amounts of data, and customers requiring industry-specific solutions.

We may not achieve anticipated revenue growth if we are unable to hire, develop, integrate, and retain talented and effective sales personnel;

if our sales personnel are unable to achieve desired productivity levels in a reasonable period of time and maintain productivity;

or if our sales and marketing programs are not effective.

Investing in Growth and Scaling our Business

We are focused on our long-term revenue potential.

We believe that our market opportunity is large, and we will continue to invest significantly in scaling across all organizational functions, with a focus on research and development, and sales and marketing, in order to grow our operations both domestically and internationally.

We have a history of introducing successful new features and capabilities on our platform, and we intend to continue to invest heavily to grow our business to take advantage of our expansive market opportunity while also focusing on profitability and cash flow.

We are focused on our long-term revenue potential and believe our market opportunity is large.

We will continue to invest significantly in research and development to improve our platform, including in the areas of data science, artificial intelligence, and machine learning.

In addition, we are focused on expanding our business both domestically and internationally.

As part of these efforts, we are investing in meeting the needs of organizations in geographies and specialized industries that have heightened data requirements, including with respect to data localization, privacy, and security.

We intend to continue to invest heavily to grow our business to take advantage of our expansive market opportunity, while also focusing on profitability and cash flow.

Key Business Metrics

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$ 778.9 $ 496.5 $ 81.2

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January 31, 2024 January 31, 2023 January 31, 2022

Customers with trailing 12-month product revenue greater than $1 million (3)

Net revenue retention rate (3)

131 % 158 % 178 %

Customers with trailing 12-month product revenue greater than $1 million (3)

Forbes Global 2000 customers (3)

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See the section titled “Free Cash Flow” for a reconciliation of free cash flow to the most directly comparable financial measure calculated in accordance with GAAP.

(2) Cash outflows for employee payroll tax items related to the net share settlement of equity awards, which were $184.6 million for the fiscal year ended January 31, 2023, are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow.

(2) Cash outflows for employee payroll tax items related to the net share settlement of equity awards, which were $380.8 million and $184.6 million for the fiscal years ended January 31, 2024 and 2023, respectively, are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow.

No equity awards were net settled prior to the fiscal year ended January 31, 2023.

(3) Historical numbers for (i) customers with trailing 12-month product revenue greater than $1 million, (ii) net revenue retention rate, and (iii) Forbes Global 2000 customers reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity.

(3) Historical numbers for (i) net revenue retention rate, (ii) customers with trailing 12-month product revenue greater than $1 million, and (iii) Forbes Global 2000 customers reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity.

In addition, our Forbes Global 2000 customer count reflects adjustments for annual updates to the Forbes Global 2000 list by Forbes.

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Product revenue excludes our professional services and other revenue, which has been less than 10% of revenue for each of the periods presented.

Customers with Trailing 12-Month Product Revenue Greater than $1 Million

Large customer relationships lead to scale and operating leverage in our business model.

Compared with smaller customers, large customers present a greater opportunity for us to sell additional capacity because they have larger budgets, a wider range of potential use cases, and greater potential for migrating new workloads to our platform over time.

As a measure of our ability to scale with our customers and attract large enterprises to our platform, we count the number of customers under capacity arrangements that contributed more than $1 million in product revenue in the trailing 12 months.

For purposes of determining our customer count, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers.

We do not include customers that consume our platform only under on-demand arrangements for purposes of determining our customer count.

Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our customer count for historical periods reflecting these adjustments.

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Net Revenue Retention Rate

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Next, we define as our measurement cohort the population of customers under capacity contracts that used our platform at any point in the first month of the first year of the measurement period.

Starting with the fiscal quarter ended October 31, 2021, the cohorts used to calculate net revenue retention rate include end-customers under a reseller arrangement.

Although the impact is not material, we have adjusted all prior periods presented to reflect this inclusion.

The cohorts used to calculate net revenue retention rate include end-customers under a reseller arrangement.

We then calculate our net revenue retention rate as the quotient obtained by dividing our product revenue from this cohort in the second year of the measurement period by our product revenue from this cohort in the first year of the measurement period.

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We expect our net revenue retention rate to decrease over the long-term as customers that have consumed our platform for an extended period of time become a larger portion of both our overall customer base and our product revenue that we use to calculate net revenue retention rate, and as their consumption growth primarily relates to existing use cases rather than new use cases.

In addition, we have recently seen, and may continue to see, our newer customers increase their consumption of our platform at a slower pace than our more tenured customers, which may negatively impact our net revenue retention rate in future periods.

In addition, we have seen, and may continue to see, impacts on customer consumption patterns due to holidays and certain of our customers increasing their consumption of our platform at a slower pace than expected, which may negatively impact our net revenue retention rate in future periods.

Customers with Trailing 12-Month Product Revenue Greater than $1 Million

Large customer relationships lead to scale and operating leverage in our business model.

We do not include customers that consume our platform only under on-demand arrangements for purposes of determining our customer count.

Forbes Global 2000 Customers

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Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments.

Remaining Performance Obligations

Remaining performance obligations (RPO) represent the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods.

RPO excludes performance obligations from on-demand arrangements and certain time and materials contracts that are billed in arrears.

Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S.

dollars each period based on the applicable period-end exchange rates.

RPO is not necessarily indicative of future product revenue growth because it does not account for the timing of customers’ consumption or their consumption of more than their contracted capacity.

Moreover, RPO is influenced by a number of factors, including the timing and size of renewals, the timing and size of purchases of additional capacity, average contract terms, seasonality, changes in foreign currency exchange rates, and the extent to which customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal.

Due to these factors, it is important to review RPO in conjunction with product revenue and other financial metrics disclosed elsewhere herein.

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Free Cash Flow

We define free cash flow, a non-GAAP financial measure, as GAAP net cash provided by (used in) operating activities reduced by purchases of property and equipment and capitalized internal-use software development costs.

We define free cash flow, a non-GAAP financial measure, as GAAP net cash provided by operating activities reduced by purchases of property and equipment and capitalized internal-use software development costs.

Cash outflows for employee payroll tax items related to the net share settlement of equity awards are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow.

We believe information regarding free cash flow provides useful supplemental information to investors because it is an indicator of the strength and performance of our core business operations.

The following table presents a reconciliation of free cash flow to net cash provided by (used in) operating activities, the most directly comparable financial measure calculated in accordance with GAAP, for the periods presented (in millions):

The following table presents a reconciliation of net cash provided by operating activities to free cash flow, the most directly comparable financial measure calculated in accordance with GAAP, for the periods presented (in millions):

Fiscal Year Ended January 31,

2024 2023 2022

Net cash provided by (used in) operating activities $ 545.6 $ 110.2 $ (45.4)

Net cash provided by operating activities $ 848.1 $ 545.6 $ 110.2

purchases of property and equipment (35.1) (25.1) (16.2)

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(1) Free cash flow for the fiscal years ended January 31, 2024, 2023, and 2022 included the effect of $31.3 million, $23.9 million, and $68.6 million respectively, in the net cash paid on payroll tax-related items on employee stock transactions.

No equity awards were net settled prior to the fiscal year ended January 31, 2023.

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As a result, we have historically seen higher free cash flow in the first and fourth fiscal quarters of each year.

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Remaining Performance Obligations

RPO excludes performance obligations from on-demand arrangements and certain time and materials contracts that are billed in arrears.

Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S.

dollars each period based on the applicable period-end exchange rates.

RPO is not necessarily indicative of future product revenue growth because it does not account for the timing of customers’ consumption or their consumption of more than their contracted capacity.

Due to these factors, it is important to review RPO in conjunction with product revenue and other financial metrics disclosed elsewhere herein.

Components of Results of Operations

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However, in future periods, we expect to see an increase in capacity contracts providing for quarterly upfront billings and monthly in arrears billings as our customers increasingly want to align consumption and timing of payments.

Revenue from on-demand arrangements typically relates to initial consumption as part of customer onboarding and, to a lesser extent, overage consumption beyond a customer’s contracted usage amount or following the expiration of a customer’s contract.

Revenue from on-demand arrangements typically relates to customers with lower usage levels or overage consumption beyond a customer’s contracted usage amount or following the expiration of a customer’s contract.

Revenue from on-demand arrangements represented approximately 3%, 2%, and 3% of our revenue for the fiscal years ended January 31, 2024, 2023, and 2022, respectively.

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Our customer contracts for capacity typically have a term of one to four years.

The weighted-average term of capacity contracts entered into during the fiscal year ended January 31, 2023 is 2.2 years.

The weighted-average term of capacity contracts entered into during the fiscal year ended January 31, 2024 is approximately 2.6 years.

To the extent our customers enter into such contracts and either consume our platform in excess of their capacity commitments or continue to use our platform after expiration of the contract term, they are charged for their incremental consumption.

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However, in any given period, there is a risk that customers will consume our platform more slowly than we expect, including in response to adverse macroeconomic conditions, which may cause fluctuations in our revenue and results of operations.

For example, we have recently seen, and may continue to see, our newer customers increase their consumption of our platform at a slower pace than our more tenured customers.

In addition, new software releases or hardware improvements, like better storage compression and cloud infrastructure processor improvements, may make our platform more efficient, enabling customers to consume fewer compute, storage, and data transfer resources to accomplish the same workloads.

To the extent these improvements do not result in an offsetting increase in new workloads, we may experience lower revenue.

Our revenue also includes professional services and other revenue, which consists primarily of consulting, technical solution services, and training related to our platform.

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Other revenue consists primarily of fees from customer training delivered on-site or through publicly available classes.

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Allocation of Overhead Costs

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We periodically receive credits from third-party cloud providers that are recorded as a reduction to the third-party cloud infrastructure expenses.

Cost of product revenue also includes amortization of internal-use software development costs, amortization of acquired developed technology intangible assets, and expenses associated with software and subscription services dedicated for use by our customer support team and our engineering team responsible for maintaining our platform.

Cost of product revenue also includes amortization of capitalized internal-use software development costs, amortization of acquired intangible assets, and expenses associated with software and subscription services dedicated for use by our customer support team and our engineering team responsible for maintaining our platform.

Cost of professional services and other revenue.

Cost of professional services and other revenue consists primarily of personnel-related costs associated with our professional services and training departments, including salaries, benefits, bonuses, and stock-based compensation, and costs of contracted third-party partners and software tools.

Cost of professional services and other revenue consists primarily of personnel-related costs associated with our professional services and training departments, including salaries, benefits, bonuses, and stock-based compensation, amortization of an acquired intangible asset, and costs of contracted third-party partners and software tools.

We intend to continue to invest additional resources in our platform infrastructure and our customer support and professional services organizations to support the growth of our business.

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Sales and marketing expenses also include sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions.

A portion of the sales commissions paid to the sales force is earned based on the rate of the customers’ consumption of our platform, and a portion of the commissions paid to the sales force is earned upon the origination of the customer contracts.

A portion of the sales commissions paid to the sales force is earned based on the level of the customers’ consumption of our platform, and a portion of the commissions paid to the sales force is earned upon the origination of the customer contracts.

Sales commissions tied to customers’ consumption are expensed in the same period as they are earned.

Sales commissions and referral fees earned upon the origination of the new customer or customer expansion contracts are deferred and then amortized over a period of benefit that we determined to be five years.

Sales and marketing expenses also include advertising costs and other expenses associated with our sales, marketing and business development programs, including Summit, our annual user conference, offset by proceeds from such conferences and programs.

In addition, sales and marketing expenses are comprised of travel-related expenses, software and subscription services dedicated for use by our sales and marketing organizations, amortization of an acquired developer community intangible asset, and outside services contracted for sales and marketing purposes.

As our go-to-market motion evolves, more sales personnel will be compensated based on the level of the customers’ consumption of our platform.

As a result, we will defer less sales commissions, and we expect that our expenses associated with sales commissions tied to customers’ consumption will increase during the fiscal year ending January 31, 2025.

Sales and marketing expenses also include advertising costs and other expenses associated with our sales, marketing and business development programs, including our user conferences such as Data Cloud Summit and Data Cloud World Tour, offset by proceeds from such conferences and programs.

In addition, sales and marketing expenses are comprised of travel-related expenses, software and subscription services dedicated for use by our sales and marketing organizations, amortization of an acquired intangible asset, and outside services contracted for sales and marketing purposes.

We expect that our sales and marketing expenses will increase in absolute dollars and continue to be our largest operating expense for the foreseeable future as we grow our business.

However, we expect that our sales and marketing expenses will decrease as a percentage of our revenue over time, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

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Research and Development

Research and development expenses consist primarily of personnel-related expenses associated with our research and development staff, including salaries, benefits, bonuses, and stock-based compensation.

Research and development expenses also include contractor or professional services fees, third-party cloud infrastructure expenses incurred in developing our platform, and expenses associated with computer equipment, software and subscription services dedicated for use by our research and development organization.

Research and development expenses also include contractor or professional services fees, third-party cloud infrastructure expenses incurred in developing our platform, amortization of acquired intangible assets, and software and subscription services dedicated for use by our research and development organization.

We expect that our research and development expenses will increase in absolute dollars as our business grows, particularly as we incur additional costs related to continued investments in our platform.

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Other Income (Expense), Net

Other income (expense), net consists primarily of (i) unrealized gains (losses) on our strategic investments in equity securities, and (ii) the effect of exchange rates on our foreign currency-denominated asset and liability balances.

Other income (expense), net consists primarily of (i) net realized and unrealized gains (losses) on our strategic investments in equity securities, and (ii) the effect of exchange rates on our foreign currency-denominated asset and liability balances.

Provision for (Benefit from) Income Taxes

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See Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

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Results of Operations

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Total stock-based compensation $ 1,168,015 $ 861,533 $ 605,095

The increase in stock-based compensation for the fiscal year ended January 31, 2023, compared to the fiscal year ended January 31, 2022, was primarily attributable to additional equity awards granted to existing and new employees, partially offset by a decrease in stock-based compensation associated with restricted stock unit awards (RSUs) granted prior to our Initial Public Offering (IPO).

RSUs granted prior to our IPO have both a service-based and a performance-based vesting condition and, as a result of the performance-based vesting condition being satisfied in connection with our IPO, we recognized stock-based compensation associated with such RSUs using an accelerated attribution method.

As of January 31, 2023, total compensation cost related to unvested equity awards not yet recognized was $2.4 billion, which will be recognized over a weighted-average period of 2.9 years.

The increase in stock-based compensation for the fiscal year ended January 31, 2024, compared to the fiscal year ended January 31, 2023, was primarily attributable to additional equity awards granted to new and existing employees, partially offset by a decrease in stock-based compensation associated with restricted stock unit awards (RSUs) granted prior to our Initial Public Offering (IPO).

As of January 31, 2024, total compensation cost related to unvested awards not yet recognized was $3.0 billion, which will be recognized over a weighted-average period of 2.9 years.

See Note 11, “Equity,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

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The following table sets forth our consolidated statements of operations data expressed as a percentage of revenue for the periods indicated:

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Product revenue increased $728.1 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to increased consumption of our platform by existing customers, as evidenced by our net revenue retention rate of 131% as of January 31, 2024.

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The increase in product revenue was also driven by an increase in capacity consumption prices of approximately 3% for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to increased consumption of higher-priced editions of our platform and better discipline over discounting.

We had 461 customers with product revenue of greater than $1 million for the trailing 12 months ended January 31, 2024, an increase from 331 customers as of January 31, 2023.

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Within these customers, we had 83 and 26 customers with product revenue of greater than $5 million and $10 million, respectively, for the trailing 12 months ended January 31, 2024.

Approximately 96% and 93% of our revenue was derived from existing customers under capacity arrangements for the fiscal years ended January 31, 2023 and 2022, respectively.

Revenue derived from new customers under capacity arrangements represented approximately 2% and 4% of our revenue for the fiscal years ended January 31, 2023 and 2022, respectively.

The remainder was driven by on-demand arrangements.

The substantial majority of our revenue was derived from existing customers under capacity arrangements, which represented approximately 97% and 96% of our revenue for the fiscal years ended January 31, 2024 and 2023, respectively.

The remainder was derived from new customers under capacity arrangements and on-demand arrangements.

The preceding historical metrics reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity.

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Total headcount 939 861

Cost of product revenue increased $199.7 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily due to an increase of $156.9 million in third-party cloud infrastructure expenses as a result of increased customer consumption.

Personnel-related costs and allocated overhead costs also increased $28.7 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, as a result of increased headcount and overall costs to support the growth in our business, and increased stock-based compensation primarily related to additional equity awards granted to existing and new employees.

The remaining increase in cost of product revenue was primarily driven by an increase of $7.6 million in amortization of internal-use software development costs and acquired developed technology intangible assets.

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Our product gross margin was 72% for the fiscal year ended January 31, 2023, compared to 70% for the prior fiscal year, primarily due to (i) increased cost efficiency as a result of cloud infrastructure processor improvements, (ii) an increased percentage of revenue from consumption of higher-priced editions of our platform, (iii) increased scale across our cloud infrastructure regions, and (iv) higher volume-based discounts for our purchases of third-party cloud infrastructure.

In addition, the year-over-year increase in our product gross margin was driven by a decrease in stock-based compensation as a percentage of product revenue.

While we expect our product gross margin to remain relatively flat for the fiscal year ending January 31, 2024, a number of factors could hinder any improvement in our product gross margin, including (i) fluctuations in the mix and timing of customers' consumption, which is inherently variable at our customers' discretion, (ii) whether or not a customer contracts with us through our marketplace listings, (iii) our discounting practices, including as a result of changes to the competitive environment, and (iv) the extent of our investments in our operations, including performance improvements that may make our platform or the underlying cloud infrastructure more efficient.

Cost of product revenue increased $153.7 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to an increase of $78.2 million in third-party cloud infrastructure expenses as a result of increased customer consumption of our platform.

Personnel-related costs and allocated overhead costs also increased $33.3 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, as a result of increased headcount and overall costs to support the growth in our business, and increased stock-based compensation primarily related to additional equity awards granted to new and existing employees.

The remaining increase in cost of product revenue was primarily driven by an increase of $34.5 million in amortization of acquired developed technology intangible assets and capitalized internal-use software development costs.

Our product gross margin was 74% for the fiscal year ended January 31, 2024, compared to 72% for the prior fiscal year, primarily due to (i) higher volume-based discounts for our purchases of third-party cloud infrastructure, and (ii) increased cost efficiency as a result of cloud infrastructure processor improvements.

While we expect our product gross margin to slightly improve for the fiscal year ending January 31, 2025, a number of factors could hinder any improvement in our product gross margin, including (i) fluctuations in the mix and timing of customers’ consumption, which is inherently variable at our customers’ discretion, (ii) whether or not a customer contracts with us through public cloud marketplaces, (iii) our discounting practices, including as a result of changes to the competitive environment, and (iv) the extent of our investments in our operations, including performance improvements that may make our platform or the underlying cloud infrastructure more efficient.

Cost of professional services and other revenue increased $27.4 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to an increase of $26.0 million in personnel-related costs and allocated overhead costs, as a result of increased headcount and overall costs to support the growth in our business, and increased stock-based compensation primarily related to additional equity awards granted to existing and new employees.

Costs associated with contracted third-party partners, primarily related to customer implementations and migrations from legacy solutions, also increased $9.6 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, as a result of growth in our business.

Professional services and other gross margin improved for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily due to decreased stock-based compensation as a percentage of professional services and other revenue.

We do not believe the year-over-year changes in professional services and other gross margins are meaningful given that we are continuing to scale our professional services organization and our professional services and other revenue represents a small percentage of our revenue.

The overall increase in cost of professional services and other revenue was also driven by increased amortization of an acquired developed technology intangible asset as a result of the Mountain business combination completed in February 2023, partially offset by a decrease in costs associated with contracted third-party partners.

Professional services and other gross margin declined for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to overall increased costs from scaling our professional services organization, including increased headcount and amortization of an acquired developed technology intangible asset as a result of the Mountain business combination.

However, we do not believe the year-over-year changes in professional services and other gross margins are meaningful given that our professional services and other revenue represents a small percentage of our revenue.

Sales and Marketing

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Sales and marketing expenses increased $285.2 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to an increase of $206.2 million in personnel-related costs (excluding commission expenses) and allocated overhead costs, as a result of increased headcount, stock-based compensation, and overall costs to support the growth in our business.

The increase in personnel-related costs included a $60.8 million increase in stock-based compensation for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily related to additional equity awards granted to existing and new employees, partially offset by a decrease in stock-based compensation related to RSUs granted prior to our IPO.

The increase in personnel-related costs included a $52.8 million increase in stock-based compensation for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily related to additional equity awards granted to existing and new employees, partially offset by a decrease in stock-based compensation related to RSUs granted prior to our IPO that is recognized using an accelerated attribution method.

See Note 11, “Equity,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

Expenses associated with sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions, increased $33.1 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily due to increases in customers’ consumption of our platform and in the annualized contract value of our customer contracts.

Advertising costs and other expenses associated with our sales, marketing and business development programs also increased $39.4 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily driven by increased expenses related to in-person sales and marketing events and user conferences, including Summit, our annual user conference which was held virtually in the prior year due to the COVID-19 pandemic, net of associated proceeds.

As a result of our in-person sales and marketing events and user conferences as well as the easing of COVID-19 travel restrictions, travel-related expenses also increased $17.4 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year.

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In addition, sales and marketing expenses for the fiscal year ended January 31, 2023 included $25.2 million of amortization of an acquired developer community intangible asset as a result of the Streamlit business combination completed in March 2022.

Expenses associated with sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions, increased $46.1 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to increases in customers’ consumption of our platform.

In addition, advertising costs and other expenses associated with our sales, marketing and business development programs increased $19.2 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year.

The remaining increase in sales and marketing expenses for the fiscal year ended January 31, 2024 was primarily attributable to a $12.4 million increase in travel-related expenses.

Research and Development

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Research and development expenses increased $499.9 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to an increase of $423.3 million in personnel-related costs and allocated overhead costs, as a result of increased stock-based compensation, headcount, and overall costs to support the growth in our business.

The increase in personnel-related costs included $174.7 million increase in stock-based compensation, primarily related to additional equity awards granted to existing and new employees and the post-combination stock-based compensation related to the Streamlit business combination, partially offset by a decrease in stock-based compensation related to RSUs granted prior to our IPO.

The increase in personnel-related costs included a $237.4 million increase in stock-based compensation, primarily related to additional equity awards granted to new and existing employees, partially offset by a decrease in stock-based compensation related to RSUs granted prior to our IPO that is recognized using an accelerated attribution method.

See Note 11, “Equity,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

The remaining increase in research and development expenses was primarily driven by an increase of $22.8 million in third-party cloud infrastructure expenses incurred in developing our platform.

Third-party cloud infrastructure expenses incurred in developing our platform also increased $42.4 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year.

The remaining increase in research and development expenses for the fiscal year ended January 31, 2024 was primarily driven by (i) impairment charges of $7.1 million, recognized during the fiscal year ended January 31, 2024, related to our capitalized internal-use software development costs previously included in construction in progress that were no longer probable of being completed, and, to a lesser extent, (ii) increased costs associated with software and subscription services dedicated for use by our research and development organization, and (iii) increased amortization of developed technology intangible assets acquired from business combinations.

General and Administrative

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Headcount (at period end) 1,055 907

General and administrative expenses increased $30.8 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily due to an increase of $14.0 million in outside services mainly as a result of increased legal fees related to acquisitions.

Unallocated lease costs, which are associated with unused office facilities to accommodate planned headcount growth, also increased $4.9 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year.

The remaining increase in general and administrative expenses was primarily attributable to increased insurance expenses and increased other corporate expenses to support the normal course of operations and our continued growth.

General and administrative expenses increased $27.2 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to an increase of $20.0 million in personnel-related costs and allocated overhead costs, as a result of increased headcount and overall costs to support the growth in our business.

Costs associated with outside services also increased $5.6 million due to increased legal fees, accounting and other professional service fees related to the normal course of operations.

Interest Income

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Interest income increased $126.8 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to higher yields on our investments in available-for-sale marketable debt securities as a result of increased interest rates.

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Other Income (Expense), Net

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Net unrealized gains (losses) on strategic investments in non-marketable equity securities:

Upward adjustments $ 4,125 $ 32,975 (87%)

Impairments (38,036) — NM

Net unrealized losses on strategic investments in marketable equity securities (12,524) (5,354) 134%

Upward adjustments $ — $ 4,125 NM

Impairments (3,101) (38,036) (92%)

Net unrealized gains (losses) on strategic investments in marketable equity securities

15,197 (12,524) (221%)

Realized gains on strategic investments in non-marketable equity securities

Other (1,922) (1,130) 70%

Other income (expense), net

$ 44,887 $ (47,565) (194%)

NM - Not meaningful.

Other income (expense), net decreased $76.5 million for the fiscal year ended January 31, 2023, compared to the prior fiscal year, primarily due to (i) impairments recorded on our strategic investments in non-marketable equity securities, (ii) a decrease in upward adjustments recorded on our strategic investments in non-marketable equity securities, and (iii) increased net unrealized losses recorded on our strategic investments in marketable equity securities.

See Note 5, “Fair Value Measurements,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

Provision for (Benefit from) Income Taxes

Other income (expense), net increased $92.5 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to (i) a decrease in impairments recorded on our strategic investments in non-marketable equity securities, (ii) a remeasurement gain recognized on a previously held equity interest as a result of a business combination completed during the fiscal year ended January 31, 2024, and (iii) changes in net unrealized gains or losses on our strategic investments in marketable equity securities.

See Note 5, “Fair Value Measurements,” and Note 7, “Business Combinations,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

Benefit from Income Taxes

Fiscal Year Ended January 31,

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Loss before income taxes $ (849,223) $ (815,993) 4%

Provision for (benefit from) income taxes (18,467) 2,988 (718%)

Benefit from income taxes

(11,233) (18,467) (39%)

Effective tax rate 1.3% 2.3%

Our benefit from income taxes was $18.5 million for the fiscal year ended January 31, 2023, compared to our provision for income taxes of $3.0 million for the fiscal year ended January 31, 2022, primarily due to the partial release of a valuation allowance of $26.9 million as a result of the Streamlit business combination.

Our benefit from income taxes decreased $7.2 million for the fiscal year ended January 31, 2024, compared to the prior fiscal year, primarily due to a $7.7 million decrease in partial releases of valuation allowances as a result of the business combinations completed during the periods.

We maintain a full valuation allowance on our U.S.

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As of January 31, 2024, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments totaling $4.8 billion.

Our investments primarily consist of corporate notes and bonds, commercial paper, U.S.

government and agency securities, certificates of deposit, and money market funds.

Our investments primarily consist of U.S.

government and agency securities, corporate notes and bonds, money market funds, commercial paper, certificates of deposit, and time deposits.

As of January 31, 2024, our RPO was $5.2 billion.

Our RPO represents the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods, which are not recorded on the balance sheet.

Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S.

dollars each period based on the applicable period-end exchange rates.

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Since inception, we have financed operations primarily through proceeds received from sales of equity securities and payments received from our customers.

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We also received aggregate proceeds of $500.0 million related to certain concurrent private placements, and did not pay any underwriting discounts or commissions with respect to the shares that were sold in these private placements.

Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses, sales and marketing expenses, overhead costs, and acquisitions and strategic investments we may make from time to time.

As of January 31, 2023, our material cash requirements from known contractual obligations and commitments relate primarily to (i) third-party cloud infrastructure agreements, (ii) operating leases for office facilities, and (iii) subscription arrangements used to facilitate our operations at the enterprise level.

Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses, sales and marketing expenses, overhead costs, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our authorized stock repurchase program.

As of January 31, 2024, our material cash requirements from known contractual obligations and commitments related primarily to (i) third-party cloud infrastructure agreements, (ii) operating leases for office facilities, and (iii) subscription arrangements used to facilitate our operations at the enterprise level.

These agreements are enforceable and legally binding and specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions, and the approximate timing of the actions under the contracts.

In January 2023, we amended one of our third-party cloud infrastructure agreements effective February 1, 2023.

Under the amended agreement, we have committed to spend an aggregate of at least $2.5 billion from fiscal 2024 to fiscal 2028 on cloud infrastructure services ($350.0 million in fiscal 2024, $450.0 million in fiscal 2025, $500.0 million in fiscal 2026, $550.0 million in fiscal 2027, and $650.0 million in fiscal 2028).

We are required to pay the difference if we fail to meet the minimum purchase commitment during any fiscal year, and such payment can be applied to qualifying expenditures for cloud infrastructure services during the term of the amended agreement.

For more information regarding our contractual obligations and commitments as of January 31, 2024, see Note 10, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Our long-term purchase commitments may be satisfied earlier than the payment periods presented as we continue to grow and scale our business.

On February 10, 2023, we acquired (i) all outstanding stock of Mountain US Corporation (f/k/a Mobilize.net Corporation), a privately-held company which provides a premier suite of tools for efficiently migrating databases to the Data Cloud, for approximately $67 million in cash, net of cash and cash equivalents acquired, and (ii) all outstanding stock of LeapYear Technologies, Inc., a privately-held company which provides a differential privacy platform, for approximately $59 million in cash, net of cash and restricted cash acquired.

In February 2023, our board of directors authorized a stock repurchase program of up to $2.0 billion of our outstanding common stock.

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The program does not obligate us to acquire any particular amount of common stock, and the repurchase program may be suspended or discontinued at any time at our discretion.

We believe that our existing cash, cash equivalents, and short-term and long-term investments, as well as cash flows expected to be generated by our operations, will be sufficient to support our working capital and capital expenditure requirements, acquisitions and strategic investments we may make from time to time, and authorized stock repurchases, for the next 12 months and beyond.

Our future capital requirements will depend on many factors, including our revenue growth rate, expenditures related to our headcount growth, the timing and the amount of cash received from customers, the expansion of sales and marketing activities, the timing and extent of spending to support development efforts, the price at which we are able to purchase public cloud capacity, expenses associated with our international expansion, the introduction of platform enhancements, and the continuing market adoption of our platform.

During the fiscal year ended January 31, 2024, we repurchased 4.0 million shares of our outstanding common stock for an aggregate purchase price of $591.7 million, including transaction costs, at a weighted-average price of $147.50 per share.

All repurchases were made in open market transactions (including via pre-set trading plans).

As of January 31, 2024, $1.4 billion remained available for future repurchases under the stock repurchase program.

See Note 11, “Equity,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional details.

We believe that our existing cash, cash equivalents, and short-term and long-term investments, as well as cash flows expected to be generated by our operations, will be sufficient to support our working capital and capital expenditure requirements, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our authorized stock repurchase program, for the next 12 months and beyond.

Our future capital requirements will depend on many factors, including our revenue growth rate, expenditures related to our headcount growth, the timing and the amount of cash received from customers, the expansion of sales and marketing activities, the timing and extent of spending to support development efforts, the price at which we are able to purchase public cloud capacity, our existing commitments to our third-party cloud providers, expenses associated with our international expansion, the introduction of platform enhancements, the continuing market adoption of our platform, and the volume and timing of our stock repurchases.

We may continue to enter into arrangements to acquire or invest in complementary businesses, products, and technologies.

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If we are unable to raise additional capital or generate cash flows necessary to expand our operations and invest in continued innovation, we may not be able to compete successfully, which would harm our business, results of operations, and financial condition.

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The following table shows a summary of our cash flows for the periods presented (in thousands):

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2024 2023 2022

Net cash provided by (used in) operating activities $ 545,639 $ 110,179 $ (45,417)

Net cash used in investing activities $ (597,885) $ (20,800) $ (4,036,645)

Net cash provided by operating activities $ 848,122 $ 545,639 $ 110,179

Net cash provided by (used in) investing activities $ 832,258 $ (597,885) $ (20,800)

Net cash provided by (used in) financing activities $ (854,103) $ (92,624) $ 178,198

Operating Activities

Net cash provided by operating activities mainly consists of our net loss adjusted for certain non-cash items, primarily consisting of (i) stock-based compensation, net of amounts capitalized, (ii) depreciation and amortization of property and equipment and amortization of acquired intangible assets, (iii) amortization of deferred commissions, (iv) net unrealized gains or losses on strategic investments in equity securities, (v) amortization of operating lease right-of-use assets, (vi) net amortization (accretion) of premiums (discounts) on investments, and (vii) deferred income tax benefit or expense, and changes in operating assets and liabilities during each period.

Net cash provided by operating activities mainly consists of our net loss adjusted for certain non-cash items, primarily consisting of (i) stock-based compensation, net of amounts capitalized, (ii) depreciation and amortization of property and equipment and amortization of acquired intangible assets, (iii) amortization of deferred commissions, (iv) net amortization (accretion) of premiums (discounts) on investments, (v) amortization of operating lease right-of-use assets, (vi) net unrealized gains or losses on strategic investments in equity securities, and (vii) deferred income tax benefit or expense, and changes in operating assets and liabilities during each period.

For the fiscal year ended January 31, 2024, net cash provided by operating activities was $848.1 million, primarily consisting of our net loss of $838.0 million, adjusted for non-cash charges of $1.3 billion, and net cash inflows of $390.7 million provided by changes in our operating assets and liabilities, net of the effects of business combinations.

The main drivers of the changes in operating assets and liabilities during the fiscal year ended January 31, 2023 were (i) a $514.3 million increase in deferred revenue due to invoicing for prepaid capacity agreements outpacing revenue recognition, and (ii) a $74.5 million increase in accrued expenses and other liabilities primarily due to increased headcount and growth in our business, partially offset by (a) a $167.0 million increase in accounts receivable primarily due to growth in our business, (b) a $95.1 million increase in deferred commissions earned upon the origination of customer contracts, and (c) a $42.3 million decrease in operating lease liabilities due to payments related to our operating lease obligations.

For the fiscal year ended January 31, 2022, net cash provided by operating activities was $110.2 million, primarily consisting of our net loss of $679.9 million, adjusted for non-cash charges of $721.7 million, and net cash inflows of $68.4 million provided by changes in our operating assets and liabilities.

The main drivers of the changes in operating assets and liabilities during the fiscal year ended January 31, 2024 were (i) a $528.0 million increase in deferred revenue due to invoicing for prepaid capacity agreements outpacing revenue recognition, (ii) a $171.0 million increase in accrued expenses and other liabilities primarily due to increased headcount, growth in our business and the timing of accruals and payments, and (iii) a $59.8 million decrease in prepaid expenses and other assets primarily driven by a decrease in prepaid third-party cloud infrastructure expenses, partially offset by (a) a $212.1 million increase in accounts receivable primarily due to growth in our business, (b) a $134.8 million increase in deferred commissions earned upon the origination of customer contracts, and (c) a $40.5 million decrease in operating lease liabilities due to payments related to our operating lease obligations.

For the fiscal year ended January 31, 2023, net cash provided by operating activities was $545.6 million, primarily consisting of our net loss of $797.5 million, adjusted for non-cash charges of $1.1 billion, and net cash inflows of $289.5 million provided by changes in our operating assets and liabilities, net of the effects of business combinations.

Net cash provided by operating activities increased $302.5 million for the fiscal year ended January 31, 2024, compared to the fiscal year ended January 31, 2023, primarily due to an increase of $751.1 million in cash collected from customers resulting from increased sales.

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Investing Activities

Net cash used in investing activities for the fiscal year ended January 31, 2023 was $597.9 million, primarily as a result of (i) an aggregate of $362.6 million in cash paid for Streamlit, Applica and other business combinations, net of cash and cash equivalents acquired, (ii) $185.4 million in net purchases of investments, (iii) $25.1 million in purchases of property and equipment, and (iv) $24.0 million in capitalized internal-use software development costs.

Net cash used in investing activities for the fiscal year ended January 31, 2022 was $20.8 million, primarily as a result of purchases of investments, purchases of intangible assets, purchases of property and equipment to support our office facilities, and capitalized internal-use software development costs, partially offset by proceeds from the sales, maturities, and redemptions of investments.

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Net cash provided by investing activities for the fiscal year ended January 31, 2024 was $832.3 million, primarily driven by proceeds of $1.2 billion from net sales, maturities and redemptions of investments, partially offset by an aggregate of $275.7 million in cash paid for the Neeva, Mountain, LeapYear and other business combinations, net of cash, cash equivalents, and restricted cash acquired, and, to a lesser extent, purchases of property and equipment to support our office facilities, capitalized internal-use software development costs, and purchases of intangible assets.

Net cash used in investing activities for the fiscal year ended January 31, 2023 was $597.9 million, primarily as a result of an aggregate of $362.6 million in cash paid for Streamlit, Applica and other business combinations, net of cash and cash equivalents acquired, $185.4 million in net purchases of investments, and, to a lesser extent, purchases of property and equipment to support our office facilities and capitalized internal-use software development costs.

Financing Activities

Net cash used in financing activities for the fiscal year ended January 31, 2023 was $92.6 million, primarily as a result of taxes paid related to net share settlement of employee equity awards of $184.6 million, partially offset by proceeds of $80.8 million from the issuance of equity securities under our equity incentive plans, and capital contributions of $13.0 million from noncontrolling interest holders.

During the fiscal year ended January 31, 2023, we began funding withholding taxes due upon the vesting of employee RSUs in certain jurisdictions by net share settlement, rather than our previous approach of selling shares of our common stock to cover taxes upon vesting of such awards.

Net cash provided by financing activities for the fiscal year ended January 31, 2022 was $178.2 million, primarily as a result of proceeds from the issuance of equity securities under our equity incentive plans.

Net cash used in financing activities for the fiscal year ended January 31, 2024 was $854.1 million, primarily as a result of $591.7 million in repurchases of our common stock under our authorized stock repurchase program and $380.8 million in taxes paid related to net share settlement of equity awards, partially offset by proceeds of $118.4 million from the issuance of equity securities under our equity incentive plans.

Net cash used in financing activities for the fiscal year ended January 31, 2023 was $92.6 million, primarily as a result of taxes paid related to net share settlement of equity awards of $184.6 million, partially offset by proceeds of $80.8 million from the issuance of equity securities under our equity incentive plans, and capital contributions of $13.0 million from noncontrolling interest holders.

Critical Accounting Estimates

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The amounts and estimated useful lives assigned to intangible assets acquired in business combinations impact the amount and timing of future amortization expense.

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Recent Accounting Pronouncements

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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-K

Item 7. Management’s Discussion and Analysis