Zoom Communications, Inc. 10-K

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA ZOOM COMMUNICATIONS, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm 67 Consolidated Balance Sheets 69 Consolidated Statements of Operations 70 Consolidated Statements of Comprehensive Income 71 Consolidated Statements of Stockholders’ Equity 72 Consolidated Statements of Cash Flows 73 Notes to Consolidated Financial Statements 75 66 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors Zoom Communications, Inc.: Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting We have audited the accompanying consolidated balance sheets of Zoom Communications, Inc. and subsidiaries (the Company) as of January 31, 2026 and 2025, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended January 31, 2026, and the related notes and financial statement schedule II: valuation and qualifying accounts (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 31, 2026 and 2025, and the results of its operations and its cash flows for each of the years in the three-year period ended January 31, 2026, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 31, 2026 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Basis for Opinions The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 67 Table of Contents Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Sufficiency of Audit Evidence Over Revenue As discussed in Notes 1 and 2 to the consolidated financial statements, the Company’s revenue is principally derived from the sale of subscriptions to the Company’s video communications platform. The Company recorded $4,869 million of revenue for the year ended January 31, 2026. We identified the evaluation of sufficiency of audit evidence over revenue as a critical audit matter. This matter required especially subjective auditor judgment because the Company’s revenue recognition process is highly automated and is reliant upon a number of customized and proprietary information technology (IT) systems. Involvement of IT professionals with specialized skills and knowledge was required to assist with the performance of certain procedures and determination of IT applications subject to testing. The following are the primary procedures we performed to address this critical audit matter. We applied auditor judgment to determine the nature and extent of procedures to be performed over revenue. We evaluated the design and tested the operating effectiveness of certain internal controls related to revenue recognition. This included certain controls related to the Company’s general information technology and application controls related to the systems utilized within the Company’s revenue recognition process. We involved IT professionals with specialized skills and knowledge, who assisted in testing the IT controls of the various systems interacting with the Company’s revenue recognition process. We recalculated revenue for system-generated sales transactions during the year using a software audit tool. For a sample of transactions, we compared the amounts recognized for consistency with underlying documentation, including contracts with customers and cash receipts. Additionally, for the same sample of transactions, we recalculated the amount of revenue recognized in the period based on the terms of the arrangement and the satisfaction of the underlying performance obligation. In addition, we evaluated the sufficiency of audit evidence obtained over revenue by assessing the results of procedures performed. /s/ KPMG LLP We have served as the Company’s auditor since 2016. San Francisco, California February 27, 2026 68 Table of Contents ZOOM COMMUNICATIONS, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) As of January 31, 2026 2025 Assets Current assets: Cash and cash equivalents $ 1,272,877 $ 1,349,380 Marketable securities 6,544,031 6,442,329 Accounts receivable, net of allowances of $ 18,348 and $ 22,078 as of January 31, 2026 and 2025, respectively 497,339 495,228 Deferred contract acquisition costs, current 108,856 188,358 Prepaid expenses and other current assets 234,856 200,679 Total current assets 8,657,959 8,675,974 Deferred contract acquisition costs, noncurrent 215,533 123,464 Property and equipment, net 264,525 330,475 Operating lease right-of-use assets 52,423 55,900 Strategic investments 1,578,611 591,481 Goodwill 400,392 307,295 Deferred tax assets 646,640 749,759 Other assets, noncurrent 144,333 154,073 Total assets $ 11,960,416 $ 10,988,421 Liabilities and stockholders’ equity Current liabilities: Accounts payable $ 6,268 $ 8,345 Accrued expenses and other current liabilities 581,773 558,562 Deferred revenue, current 1,411,149 1,336,387 Total current liabilities 1,999,190 1,903,294 Deferred revenue, noncurrent 13,195 17,274 Operating lease liabilities, noncurrent 30,710 37,406 Other liabilities, noncurrent 109,063 95,363 Total liabilities 2,152,158 2,053,337 Commitments and contingencies (Note 9) Stockholders’ equity: Common stock, $ 0.001 par value per share, 2,000,000,000 Class A shares authorized as of January 31, 2026 and 2025; 266,805,638 and 263,113,866 shares issued and outstanding as of January 31, 2026 and 2025, respectively; 300,000,000 Class B shares authorized as of January 31, 2026 and 2025; 28,721,770 and 42,626,998 shares issued and outstanding as of January 31, 2026 and 2025, respectively 295 305 Additional paid-in capital 4,099,753 5,130,271 Accumulated other comprehensive income 8,544 4,990 Retained earnings 5,699,666 3,799,518 Total stockholders’ equity 9,808,258 8,935,084 Total liabilities and stockholders’ equity $ 11,960,416 $ 10,988,421 The accompanying notes are an integral part of these consolidated financial statements. 69 Table of Contents ZOOM COMMUNICATIONS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share data) Year Ended January 31, 2026 2025 2024 Revenue $ 4,868,769 $ 4,665,433 $ 4,527,224 Cost of revenue 1,119,036 1,129,627 1,077,801 Gross profit 3,749,733 3,535,806 3,449,423 Operating expenses: Research and development 844,875 852,415 803,187 Sales and marketing 1,388,297 1,427,384 1,541,307 General and administrative 392,928 442,712 579,650 Total operating expenses 2,626,100 2,722,511 2,924,144 Income from operations 1,123,633 813,295 525,279 Gains on strategic investments, net 969,822 177,142 109,770 Other income, net 328,830 325,147 197,263 Income before provision for income taxes 2,422,285 1,315,584 832,312 Provision for income taxes 522,137 305,346 194,850 Net income $ 1,900,148 $ 1,010,238 $ 637,462 Net income per share: Basic $ 6.32 $ 3.28 $ 2.12 Diluted $ 6.18 $ 3.21 $ 2.07 Weighted-average shares used in computing net income per share: Basic 300,503,787 307,981,971 300,748,162 Diluted 307,333,185 315,069,582 308,519,897 The accompanying notes are an integral part of these consolidated financial statements. 70 Table of Contents ZOOM COMMUNICATIONS, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands) Year Ended January 31, 2026 2025 2024 Net income $ 1,900,148 $ 1,010,238 $ 637,462 Other comprehensive income: Unrealized gain on available-for-sale marketable securities, net of income tax expense of $ 1,154 , $ 1,205 , and $ 15,501 during the fiscal years ended January 31, 2026, 2025 and 2024, respectively 3,554 3,927 51,448 Comprehensive income $ 1,903,702 $ 1,014,165 $ 688,910 The accompanying notes are an integral part of these consolidated financial statements. 71 Table of Contents ZOOM COMMUNICATIONS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in thousands, except share data) Common Stock Additional Paid-In Capital Accumulated Other Comprehensive (Loss) Income Retained Earnings Total Stockholders’ Equity Shares Amount Balance as of January 31, 2023 293,822,850 $ 294 $ 4,104,880 $ ( 50,385 ) $ 2,151,818 $ 6,206,607 Issuance of common stock upon exercise of stock options 1,464,158 1 10,194 — — 10,195 Issuance of common stock upon release of restricted stock units 11,349,453 11 ( 11 ) — Issuance of common stock for employee stock purchase plan 921,892 1 54,096 — — 54,097 Stock-based compensation expense — — 1,059,597 — — 1,059,597 Other comprehensive income — — — 51,448 — 51,448 Net income — — — — 637,462 637,462 Balance as of January 31, 2024 307,558,353 $ 307 $ 5,228,756 $ 1,063 $ 2,789,280 $ 8,019,406 Issuance of common stock upon exercise of stock options 908,844 1 4,618 — — 4,619 Issuance of common stock upon release of restricted stock units 12,095,006 12 ( 12 ) — — — Repurchase of common stock ( 15,888,316 ) ( 16 ) ( 1,095,102 ) — — ( 1,095,118 ) Issuance of common stock for employee stock purchase plan 1,066,977 1 54,007 — — 54,008 Stock-based compensation expense — — 938,004 — — 938,004 Other comprehensive income — — — 3,927 — 3,927 Net income — — — — 1,010,238 1,010,238 Balance as of January 31, 2025 305,740,864 $ 305 $ 5,130,271 $ 4,990 $ 3,799,518 $ 8,935,084 Issuance of common stock upon exercise of stock options 842,567 1 2,481 — — 2,482 Issuance of common stock upon release of restricted stock units 11,309,015 11 ( 11 ) — — — Shares withheld related to net share settlement of equity awards ( 3,180,420 ) ( 3 ) ( 247,829 ) — — ( 247,832 ) Repurchase of common stock, including excise tax ( 20,385,361 ) ( 20 ) ( 1,628,078 ) — — ( 1,628,098 ) Issuance of common stock for employee stock purchase plan 1,200,743 1 61,205 — — 61,206 Charitable donation of common stock — — 20,904 20,904 Stock-based compensation expense — — 760,810 — — 760,810 Other comprehensive income — — — 3,554 — 3,554 Net income — — — — 1,900,148 1,900,148 Balance as of January 31, 2026 295,527,408 $ 295 $ 4,099,753 $ 8,544 $ 5,699,666 $ 9,808,258 The accompanying notes are an integral part of these consolidated financial statements. 72 Table of Contents ZOOM COMMUNICATIONS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Year Ended January 31, 2026 2025 2024 Cash flows from operating activities: Net income $ 1,900,148 $ 1,010,238 $ 637,462 Adjustments to reconcile net income to net cash provided by operating activities: Stock-based compensation expense 760,776 931,309 1,057,161 Deferred income taxes 105,035 ( 90,551 ) ( 116,679 ) Amortization of deferred contract acquisition costs 283,382 282,103 270,701 Gains on strategic investments, net ( 969,822 ) ( 177,142 ) ( 109,770 ) Depreciation and amortization 132,831 122,632 104,451 Provision for accounts receivable allowances 17,351 20,022 35,244 Unrealized foreign exchange (gains) losses ( 11,405 ) 17,165 12,259 Non-cash operating lease cost 24,778 24,066 21,066 Charitable donation of common stock 20,904 — — Amortization of discount/premium on marketable securities ( 28,910 ) ( 71,636 ) ( 50,770 ) Other 22,307 4,048 ( 7,670 ) Changes in operating assets and liabilities: Accounts receivable 2,823 26,640 53,270 Prepaid expenses and other assets ( 28,821 ) ( 17,114 ) ( 71,247 ) Deferred contract acquisition costs ( 295,949 ) ( 246,727 ) ( 214,657 ) Accounts payable ( 613 ) ( 3,133 ) ( 4,416 ) Accrued expenses and other liabilities 19,761 62,277 51,974 Deferred revenue 63,186 79,995 ( 46,719 ) Operating lease liabilities, net ( 28,714 ) ( 28,884 ) ( 22,824 ) Net cash provided by operating activities 1,989,048 1,945,308 1,598,836 Cash flows from investing activities: Purchases of marketable securities ( 4,824,598 ) ( 4,622,104 ) ( 4,083,968 ) Maturities of marketable securities 4,064,393 3,610,274 3,131,419 Sales of marketable securities 684,371 47,482 1,191 Purchases of property and equipment ( 64,961 ) ( 136,560 ) ( 126,953 ) Purchases of strategic investments ( 98,245 ) ( 18,500 ) ( 70,527 ) Proceeds from sale of strategic investments 80,438 13,384 170,067 Cash paid for acquisitions, net of cash acquired ( 119,796 ) — ( 204,918 ) Purchases of intangible assets ( 500 ) — — Net cash used in investing activities ( 278,898 ) ( 1,106,024 ) ( 1,183,689 ) Cash flows from financing activities: Cash paid for repurchases of common stock, including excise taxes ( 1,620,691 ) ( 1,093,878 ) — Proceeds from issuance of common stock for employee stock purchase plan 61,206 54,008 54,097 Proceeds from exercise of stock options 2,482 4,619 10,195 Proceeds from employee equity transactions (remitted) to be remitted to employees and tax authorities, net ( 523 ) 7,174 ( 4,106 ) Taxes paid related to net share settlement of equity awards ( 247,832 ) — — Net cash (used in) provided by financing activities ( 1,805,358 ) ( 1,028,077 ) 60,186 Effect of exchange rate changes on cash, cash equivalents, and restricted cash 17,572 ( 15,170 ) ( 10,196 ) Net (decrease) increase in cash, cash equivalents, and restricted cash ( 77,636 ) ( 203,963 ) 465,137 Cash, cash equivalents, and restricted cash—beginning of year 1,361,417 1,565,380 1,100,243 Cash, cash equivalents, and restricted cash—end of year $ 1,283,781 $ 1,361,417 $ 1,565,380 73 Table of Contents Supplemental disclosures of non-cash investing and financing information Purchase of equipment during the period included in accounts payable and accrued expenses $ 15,204 $ 20,393 $ 16,206 Excise tax on share repurchases included in accrued expenses $ 8,648 $ 1,240 $ — Reconciliation of cash, cash equivalents, and restricted cash within the consolidated balance sheets to the amounts shown in the consolidated statements of cash flows above: Cash and cash equivalents $ 1,272,877 $ 1,349,380 $ 1,558,252 Restricted cash, current included in prepaid expenses and other current assets 10,904 12,037 6,874 Restricted cash, noncurrent included in other assets, noncurrent — — 254 Total cash, cash equivalents, and restricted cash $ 1,283,781 $ 1,361,417 $ 1,565,380 The accompanying notes are an integral part of these consolidated financial statements. 74 Table of Contents ZOOM COMMUNICATIONS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Summary of Business and Significant Accounting Policies Description of Business Zoom provides the AI-first, open work platform built for human connection and purposefully designed to move conversations to completion. Zoom enables customers to seamlessly collaborate, communicate, and drive outcomes across meetings, chat, phone, contact center, events, and more — all with the built-in assistance of Zoom AI Companion. We were incorporated in the state of Delaware in April 2011, and are headquartered in San Jose, California. Fiscal Year Our fiscal year ends on January 31. References to fiscal year 2026, for example, refer to the fiscal year ended January 31, 2026. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and include the accounts of Zoom Communications, Inc., its subsidiaries, and a variable interest entity for which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant items subject to such estimates and assumptions include, but are not limited to, the estimated expected benefit period for deferred contract acquisition costs, the fair value of marketable securities, acquired intangible assets and goodwill, the recognition and measurement of revenue, including estimates of variable consideration and the customer’s ability and intent to pay, the valuation of deferred income tax assets and uncertain tax positions, and accruals and contingencies. Actual results could materially differ from those estimates. Concentration of Risks Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities, restricted cash, and accounts receivable. We maintain our cash, cash equivalents, marketable securities, and restricted cash with high-quality financial institutions with investment-grade ratings. The majority of our cash balances are with U.S. banks and are insured to the extent defined by the Federal Deposit Insurance Corporation. No single customer accounted for more than 10% of accounts receivable at January 31, 2026 or 2025. No single customer accounted for 10% or more of total revenue during the fiscal years ended January 31, 2026, 2025, or 2024. Cash, Cash Equivalents, and Restricted Cash Cash and cash equivalents consist of cash in banks and highly liquid investments, primarily money market funds, purchased with an original maturity of three months or less. Restricted cash consists of certificates of deposit collateralizing our operating leases and cash from proceeds from international employees’ sales of our common stock, and is included in prepaid expenses and other current assets in the consolidated balance sheets. As of January 31, 2026 and 2025, we had $ 10.9 million and $ 12.0 million, respectively, of cash from proceeds from international employees’ sales of our common stock. The amount is held in our bank account until it is remitted to the employees and the tax authorities. Due to the restrictions on the use of the funds in the bank account, we have classified the amount as restricted cash included in prepaid expenses and other current assets, and a corresponding amount is included in accrued expenses and other current liabilities in the consolidated balance sheets. Allowance for Credit Losses We are exposed to credit losses primarily through our accounts receivable and investments in available-for-sale debt securities. See Note 3 for additional information related to our available-for-sale debt securities. 75 Table of Contents Accounts receivable, net Accounts receivable are recorded for invoiced amounts and amounts for which revenue has been recognized, but not invoiced, net of allowances. Our short-term accounts receivable consist of the following: As of January 31, 2026 As of January 31, 2025 (in thousands) Accounts receivable, gross $ 515,687 $ 517,306 Less: Allowance for credit losses ( 14,373 ) ( 17,262 ) Less: Other reserves ( 3,975 ) ( 4,816 ) Accounts receivable, net $ 497,339 $ 495,228 We maintain an allowance for credit losses for expected uncollectible accounts receivable, which is recorded as an offset to accounts receivable, with any changes classified as general and administrative expense in the consolidated statements of operations. The allowance for credit losses is based on management’s estimate for expected credit losses for outstanding accounts receivable. We determine expected credit losses based on historical write-off experience, an analysis of the aging of outstanding receivables, customer payment patterns, and the establishment of specific reserves for customers in an adverse financial condition or other factors impacting credit quality. We also consider current market conditions to inform adjustments to historical loss data. We reassess the adequacy of the allowance for credit losses each reporting period. Other reserves generally represent a reduction of accounts receivable with an offsetting reduction to deferred revenue. For the fiscal year ended January 31, 2026, our assessment took into account recent changes in macroeconomic conditions, such as inflation pressures, fluctuations in foreign currency exchange rates, and uncertain environments, which may impact our estimates of credit and collectibility trends. Below is a rollforward of our allowance for credit losses for the fiscal year ended January 31, 2026. January 31, 2026 January 31, 2025 (in thousands) Balance as of beginning of year $ 17,262 $ 25,916 Provision for credit losses 16,932 22,198 Write-offs ( 19,821 ) ( 30,852 ) Balance as of end of year $ 14,373 $ 17,262 Available-for-sale Investments Available-for-sale investments consist primarily of agency bonds, U.S. government agency securities, and treasury bills. We classify our marketable securities as available-for-sale at the time of purchase and reevaluate such classification at each balance sheet date. We may sell these securities at any time for use in current operations even if they have not yet reached maturity. As a result, we classify our securities, including those with maturities beyond 12 months, as current assets in the consolidated balance sheets. We carry these securities at fair value and record unrealized gains and losses in accumulated other comprehensive income, which is reflected as a component of stockholders’ equity. We evaluate our securities with unrealized loss positions as to whether the declines in fair value were due to credit losses, and record the portion of impairment relating to the credit losses through the allowance for credit losses limited to the amount that fair value was less than the amortized cost basis. Realized gains and losses from the sale of marketable securities are determined based on the specific identification method. Realized gains and losses are reported in other income (expense), net in the consolidated statements of operations. Strategic Investments We hold strategic investments in publicly held equity securities and privately held equity and debt securities in which we do not have a controlling interest. Publicly held equity securities are measured using quoted prices in their respective active markets with changes recorded through gains on strategic investments, net in the consolidated statements of operations. Privately held equity securities without a readily determinable fair value are recorded at cost and adjusted for impairments and observable price changes with a same or similar security from the same issuer (i.e. using the measurement alternative) and are recorded through gains on strategic investments, net in the consolidated statements of operations. If, based on the terms of these publicly traded and privately held securities, we determine that we exercise significant influence on the entity to which these securities relate, we will apply the equity method of accounting. Privately held equity securities that are accounted for under the equity method are measured at cost less any impairment, plus or minus our share of 76 Table of Contents equity method investee income or loss, which is reported in gains on strategic investments, net in the consolidated statements of operations. Privately held debt securities are recorded at fair value with changes in fair value recorded through accumulated other comprehensive income on the consolidated balance sheets. On a quarterly basis, we assess our privately held equity and debt securities in our strategic investment portfolio for indicators of impairment. For the fiscal years ended January 31, 2026, 2025, and 2024, we recognized an immaterial amount of impairment to our privately held equity and debt securities. Fair Value Measurements Fair value is defined as the exchange price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We measure financial assets and liabilities at fair value at each reporting period using a fair value hierarchy, which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Financial instruments consist of cash equivalents, restricted cash, marketable securities, accounts receivable, and accounts payable. Cash equivalents, restricted cash, and marketable securities are stated at fair value on a recurring basis. Accounts receivable and accounts payable are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date. Property and Equipment, Net Property and equipment, net, are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the respective assets, which is three to five years . Leasehold improvements are amortized over the shorter of the remaining lease term or the estimated useful life of five years . Expenditures for maintenance and repairs are expensed as incurred. Significant improvements and enhancements that substantially enhance the life of an asset are capitalized. Internal-Use Software Development Costs During the application development stage, we capitalize certain costs incurred for software developed for internal use related to our unified communications and collaboration platform as long as it is probable the project will be completed and the software will be used to perform the function intended. Capitalized software development costs are recorded in property and equipment, net. Costs related to preliminary project activities and post-implementation activities are expensed as incurred. Capitalized software development costs are amortized on a straight-line basis over the software’s estimated useful life, which is generally three years , and are recorded in cost of revenue in the consolidated statements of operations. We evaluate the useful lives of these assets on an annual basis and test for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. We capitalized $ 10.0 million, $ 14.9 million, and $ 8.1 million of internal-use software development costs during the fiscal years ended January 31, 2026, 2025, and 2024, respectively. Leases All lease arrangements, including operating lease right-of-use (“ROU”) assets and operating lease liabilities, are generally recognized at lease commencement. For short-term leases (an initial term of 12 months or less), an ROU asset and corresponding lease liability are not recorded. Instead, we record rent expense on a straight-line basis over the lease term in our consolidated statements of operations and record variable lease payments as incurred. ROU assets represent our right to use an underlying asset during the reasonably certain lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of fixed payments not yet paid over the lease term. We use our incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as our leases generally do not provide an 77 Table of Contents implicit rate. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, in an economic environment where the leased asset is located. ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. We reassess the lease term if and when a significant event or change in circumstances occurs within our control. We currently do not have any finance leases. Impairment of Long-Lived Assets We evaluate long-lived assets or asset groups for impairment whenever events indicate that the carrying value of an asset or asset group may not be recoverable based on expected future cash flows attributable to that asset or asset group. Recoverability of assets held and used is measured by comparing the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds estimated undiscounted future cash flows, then an impairment charge would be recognized based on the excess of the carrying amount of the asset or asset group over its fair value. Assets to be disposed of are reported at the lower of their carrying amount or fair value, less costs to sell. Business Combinations We account for our business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, we make estimates and use assumptions, especially with respect to intangible assets. Our estimates of fair value are based on assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, we may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. After the measurement period, any subsequent adjustments are reflected in the consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. Goodwill and Intangible Assets Goodwill amounts are not amortized, but rather tested for impairment at least annually or more often if circumstances indicate that the carrying value may not be recoverable. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. We have one reporting unit and as a result, goodwill has been assigned to the single reporting unit. We conducted our annual impairment test of goodwill in the fourth quarter of fiscal year 2026 and determined that no adjustment to the carrying value of goodwill was required. Intangible assets consist of acquired identifiable intangible assets resulting from business combinations, as well as other intangible assets purchased outside of a business combination, such as domains and intellectual property addresses. Finite-lived intangible assets are initially recorded at fair value and are amortized on a straight-line basis over their estimated useful lives. We routinely evaluate the estimated remaining useful lives of our finite-lived intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. Indefinite-lived intangible assets are recorded at fair value and are not amortized. We review the useful lives of indefinite-lived intangible assets each reporting period to determine whether events and circumstances continue to support the indefinite useful life classification. If we determine that the life of an intangible asset is no longer indefinite, that asset would be tested for impairment and amortized prospectively over its estimated remaining useful life. There were no impairment charges to acquired intangible assets during the fiscal years ended January 31, 2026, 2025, and 2024. Revenue Recognition We derive our revenue primarily from subscription agreements with customers for access to our unified communications and collaboration platform and services. We also provide other services, which include professional services, consulting services, and online event hosting, which were immaterial to our consolidated financial statements. Revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that we expect to receive in exchange for these services over the contract term, which can include a free period discount. We determine revenue recognition through the following steps: 78 Table of Contents 1. Identification of the contract, or contracts, with the customer We determine that a contract with a customer exists when the contract is approved, each party’s rights regarding the services to be transferred can be identified, the payment terms for the services can be identified, the customer has the ability and intent to pay, and the contract has commercial substance. At contract inception, we will evaluate whether two or more contracts should be combined and accounted for as a single contract and whether the combined or single contract includes more than one performance obligation. We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit and financial information pertaining to the customer. 2. Identification of the performance obligations in the contract Performance obligations in a contract are identified based on services to be transferred to the customer that are both capable of being distinct - providing benefit on their own or with readily available resources - and distinct within the contract, meaning their transfer is separately identifiable from other contractual promises. Promised services or products under which both of these two criteria are not met are recognized as a combined, single performance obligation. Our performance obligations primarily relate to access to our unified communications and collaboration platform, which consists of one or more software-based services. Our customers do not have the ability to take possession of our software, and we provide a series of distinct software-based services that are satisfied over the term of the subscription through access to our platform. 3. Determination of the transaction price The transaction price is determined based on the consideration to which we expect to be entitled in exchange for transferring services to the customer. Variable consideration is included in the transaction price if, in our judgment, it is probable that a significant future reversal of cumulative revenue recognized under the contract will not occur. None of our contracts contain a significant financing component. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental entities (e.g., sales and other indirect taxes). Our unified communications and collaboration platform and related services are typically warranted to perform in a professional manner that will comply with the terms of the subscription agreements. In addition, we include service-level commitments to our customers warranting certain levels of uptime reliability and performance, which permits those customers to receive credits in the event that we fail to meet those service levels. These credits represent a form of variable consideration. We have not provided any material refunds related to these agreements in the consolidated financial statements during the periods presented. 4. Allocation of the transaction price to the performance obligations in the contract Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on each performance obligation’s relative standalone selling price. Our contracts with multiple performance obligations are generally sold over the same subscription term and have the same pattern of transfer to the customer, and so they are accounted for as one combined performance obligation in the context of the contract. Accordingly, the transaction price is allocated to this single performance obligation. 5. Recognition of the revenue when, or as, a performance obligation is satisfied Revenue is recognized when the related performance obligation is satisfied by transferring the control of the promised service to a customer. Revenue is recognized in an amount that reflects the consideration that we expect to receive in exchange for those services. Fees for access to our unified communications and collaboration platform and related services are subscription revenue and are considered one performance obligation, and the related revenue is recognized ratably over the subscription period as we satisfy the performance obligation. Professional services are time-based arrangements and revenue is recognized as these services are performed. Fees for professional services represent less than 1 % of total revenue during the periods presented. Cost of Revenue Cost of revenue primarily consists of costs related to hosting our unified communications and collaboration platform and providing general operating support services to our customers. These costs are composed of co-located data center costs, third-party cloud hosting costs, integrated third-party PSTN services, personnel-related expenses, amortization of capitalized software development costs and acquired intangible assets, royalty payments, and allocated overhead costs. Indirect overhead costs associated with corporate facilities and related depreciation, health care benefits, training, and other employee benefits are allocated to cost of revenue and operating expenses based on applicable headcount. 79 Table of Contents Research and Development Research and development costs include personnel-related expenses associated with our engineering personnel and consultants responsible for the design, development, and testing of our unified communications and collaboration platform, depreciation of equipment used in research and development, and allocated overhead costs. Research and development costs are expensed as incurred. Advertising Costs Advertising costs are expensed as incurred in sales and marketing expense and amounted to $ 56.9 million, $ 50.8 million, and $ 56.5 million for the fiscal years ended January 31, 2026, 2025, and 2024, respectively. Stock-Based Compensation Stock-based compensation expense related to stock awards with only service conditions, including stock options, RSUs, and ESPP, are measured based on the fair value of the awards granted and recognized as an expense on a straight-line basis over the requisite service period. For RSUs with service and performance conditions, expense is recognized over the requisite service period if it is probable the performance condition will be achieved. The probability of achievement is assessed quarterly, and the effect of any change in the estimated number of performance-based awards expected to vest is recognized in the period those estimates are revised as a cumulative catch-up adjustment to stock-based compensation expense. The fair value of each option and ESPP award is estimated on the grant date using the Black-Scholes option pricing model. The Black-Scholes option pricing model requires the use of assumptions, including the fair value of the underlying common stock, the expected term of the award, the expected volatility of the price of our common stock, risk-free interest rates, and the expected dividend yield of our common stock. The fair value of each RSU award is based on the fair value of the underlying common stock as of the grant date. The assumptions used to determine the fair value of the stock awards represent management’s best estimates. These estimates involve inherent uncertainties and the application of management’s judgment. We account for forfeitures as they occur. Foreign Currency The functional currency of our foreign subsidiaries is the U.S. dollar. Accordingly, monetary assets and liabilities of our foreign subsidiaries are remeasured into U.S. dollars at the exchange rates in effect at the reporting date. Non-monetary assets and liabilities are remeasured at historical rates, and revenue and expenses are remeasured at average exchange rates in effect during each reporting period. Income Taxes We use the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax assets are evaluated for future realization and reduced by a valuation allowance to the extent we believe it is more likely than not that they will not be realized. We consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations. We record uncertain tax positions on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. We consider many factors when evaluating our uncertain tax positions, which involve significant judgment and may require periodic adjustments. The resolution of these uncertain tax positions in a manner inconsistent with management's expectations could have a material impact on our consolidated financial statements. We recognize interest and penalties related to uncertain tax positions as a component of our provision for income taxes. Accrued interest and penalties are included with the related tax liability. 80 Table of Contents Net Income Per Share We calculate our net income per share attributable to Class A and Class B common stock using the two-class method required for companies with participating securities. Basic net income per share is computed by dividing net income by the weighted-average number of shares of our Class A and Class B common stock outstanding. Diluted net income per share is computed by giving effect to all dilutive securities. Diluted net income per share is computed by dividing the resulting net income by the weighted-average number of fully diluted common shares outstanding. Recently Adopted Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which aims to improve the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 and early adoption is permitted. We have adopted ASU 2023-09 for the fiscal year ended January 31, 2026, using a prospective approach. Prior period disclosures have not been adjusted to reflect the new disclosure requirements. The adoption did not have a material impact on our consolidated financial statements. Refer to Note 11 to the consolidated financial statements for expanded income tax disclosures. In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), which introduces a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025 and interim periods within those annual reporting periods. Early adoption is permitted. We early adopted ASU 2025-05 as of the third quarter of fiscal year 2026 and elected the practical expedient provided therein. Adoption of the ASU did not have an impact on our consolidated financial statements. Recent Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which aims to improve financial reporting by requiring additional disclosure about specific expense categories in the notes to financial statements at interim and annual reporting periods. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements. In September 2025, the Financial Accounting Standards Board issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”), which aims to modernize financial reporting by updating how entities recognize and disclose costs incurred for software developed for internal use. ASU 2025-06 is effective for fiscal years beginning after December 15, 2026, and interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating the impact of the adoption of this ASU on our consolidated financial statements. 2. Revenue Recognition Disaggregation of Revenue The following table summarizes revenue by region based on the billing address of customers: 81 Table of Contents Year Ended January 31, 2026 2025 2024 Amount Percentage of Revenue Amount Percentage of Revenue Amount Percentage of Revenue (in thousands, except percentages) Americas $ 3,508,148 72.1 % $ 3,351,286 71.8 % $ 3,228,914 71.3 % APAC 590,710 12.1 % 571,443 12.2 % 571,596 12.6 % EMEA 769,911 15.8 % 742,704 16.0 % 726,714 16.1 % Total $ 4,868,769 100.0 % $ 4,665,433 100.0 % $ 4,527,224 100.0 % Contract Balances We receive payments from customers based on a billing schedule as established in our customer contracts. Accounts receivable are recorded when we contractually have the right to consideration. In some arrangements, a right to consideration for our performance under the customer contract may occur before invoicing to the customer, resulting in an unbilled accounts receivable. The amount of unbilled accounts receivable included within accounts receivable, net of allowances on the consolidated balance sheets, was $ 84.9 million and $ 118.5 million as of January 31, 2026 and 2025, respectively, and the amount of unbilled accounts receivable included within other assets, noncurrent on the consolidated balance sheets was de minimis as of January 31, 2026 and 2025. Contract liabilities consist of deferred revenue. Revenue is deferred when we have the right to invoice in advance of performance under a customer contract. The current portion of deferred revenue balances is recognized over the next 12 months. The amount of revenue recognized during the fiscal years ended January 31, 2026, 2025, and 2024 that was included in deferred revenue at the beginning of each period was $ 1,336.0 million, $ 1,249.8 million, and $ 1,257.4 million, respectively. Remaining Performance Obligations The terms of our subscription agreements are monthly, annual, and multiyear and we may bill for the full term in advance or on an annual, quarterly, or monthly basis, depending on the billing terms with customers. As of January 31, 2026, the aggregate amount of the transaction price allocated to our remaining performance obligations was $ 4,185.0 million, which consists of both billed consideration in the amount of $ 1,424.3 million and unbilled consideration in the amount of $ 2,760.7 million that we expect to recognize as revenue. We expect to recognize 57 % of our remaining performance obligations as revenue over the next 12 months and the remainder thereafter. Cost to Obtain a Contract We primarily capitalize sales commissions and associated payroll taxes paid to internal sales personnel that are incremental costs from the acquisition of customer contracts. These costs are recorded as deferred contract acquisition costs in the consolidated balance sheets. We determine whether costs should be deferred based on our sales compensation plans and if the commissions are incremental and would not have occurred absent the customer contract. Sales commissions paid upon the initial acquisition of a customer contract were historically amortized over an estimated period of benefit of three years . We determine the period of benefit for commissions paid for the acquisition of the initial customer contract by taking into consideration the initial estimated customer life and the technological life of our unified communications and collaboration platform and related significant features. Generally, we do not pay sales commissions upon contract renewal. Amortization is recognized on a straight-line basis commensurate with the pattern of revenue recognition and is included in sales and marketing expense in the consolidated statements of operations. We periodically review these deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit. At the end of fiscal 2026, we completed a re-assessment of the estimated period of benefit for deferred contract acquisition costs and determined that we should increase the amortization period from three years to five years . The impact of the change in the accounting estimate is reflected in the consolidated balance sheet as of January 31, 2026, and is accounted for prospectively from that date. The change in amortization period did not impact sales and marketing expenses for the fiscal year ended January 31, 2026. There were no impairment losses recorded during the periods presented. 82 Table of Contents The following table represents a rollforward of deferred contract acquisition costs: Year Ended January 31, 2026 2025 (in thousands) Beginning balance $ 311,822 $ 347,198 Additions to deferred contract acquisition costs 295,949 246,727 Amortization of deferred contract acquisition costs ( 283,382 ) ( 282,103 ) Ending balance $ 324,389 $ 311,822 Deferred contract acquisition costs, current (to be amortized in next 12 months) $ 108,856 $ 188,358 Deferred contract acquisition costs, noncurrent 215,533 123,464 Total deferred contract acquisition costs $ 324,389 $ 311,822 3. Investments Marketable Securities As of January 31, 2026 and 2025, our marketable securities consisted of the following: As of January 31, 2026 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Agency bonds $ 1,095,004 $ 1,032 $ ( 565 ) $ 1,095,471 U.S. government agency securities 5,373,782 11,094 ( 989 ) 5,383,887 Treasury bills 64,671 5 ( 3 ) 64,673 Marketable securities $ 6,533,457 $ 12,131 $ ( 1,557 ) $ 6,544,031 As of January 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (in thousands) Commercial paper $ 20,841 $ — $ — $ 20,841 Agency bonds 1,173,518 1,609 ( 643 ) 1,174,484 Corporate and other debt securities 719,145 2,069 ( 419 ) 720,795 U.S. government agency securities 4,412,730 8,449 ( 5,249 ) 4,415,930 Treasury bills 110,237 43 ( 1 ) 110,279 Marketable securities $ 6,436,471 $ 12,170 $ ( 6,312 ) $ 6,442,329 Unrealized losses for securities that have been in an unrealized loss position for less than 12 months were $ 1.5 million and $ 6.2 million as of January 31, 2026 and 2025, respectively. Unrealized losses for securities that have been in an unrealized loss position for 12 months or longer were immaterial as of both January 31, 2026 and 2025. We review the individual securities that have unrealized losses on a regular basis to evaluate whether any security has experienced, or is expected to experience, credit losses resulting in the decline in fair value. We evaluate, among other factors, whether we have the intention to sell any of these marketable securities and whether it is more likely than not that we will be required to sell any of them before recovery of the amortized cost basis. We have not recorded an allowance for credit losses, as we believe any such losses would be immaterial based on the high-grade credit rating for each of our marketable securities as of the end of each fiscal year. There were no material realized gains or losses from available-for-sale securities that were reclassified out of accumulated other comprehensive income for the fiscal years ended January 31, 2026, 2025, and 2024. The following table presents the contractual maturities of our marketable securities as of January 31, 2026 and 2025: 83 Table of Contents As of January 31, 2026 2025 (in thousands) Less than one year $ 3,168,258 $ 3,534,014 Due in one to three years 3,375,773 2,908,315 Total $ 6,544,031 $ 6,442,329 Strategic Investments Strategic investments by type and measurement category as of January 31, 2026 were as follows: Measurement Category Fair Value Measurement Alternative Equity Method Total (in thousands) Equity securities $ — $ 1,448,531 $ 126,112 $ 1,574,643 Debt securities 3,968 — — 3,968 Strategic investments $ 3,968 $ 1,448,531 $ 126,112 $ 1,578,611 Strategic investments by form and measurement category as of January 31, 2025 were as follows: Measurement Category Fair Value Measurement Alternative Equity Method Total (in thousands) Equity securities $ 35,280 $ 452,160 $ 99,591 $ 587,031 Debt securities 4,450 — — 4,450 Strategic investments $ 39,730 $ 452,160 $ 99,591 $ 591,481 During the fiscal year ended January 31, 2026, we made a total of $ 70.7 million of strategic investments in equity securities of private companies. Based on the terms of these privately-held securities, we determined that we do not have a controlling interest or the ability to exercise significant influence over the operating and financial policies of the investees. Therefore, these investments are currently accounted for under the measurement alternative method. During the fiscal year ended January 31, 2026, we recorded net unrealized gains of $ 951.7 million on our investments accounted for under the measurement alternative method. During the fiscal year ended January 31, 2026, we sold a total of $ 75.6 million of strategic investments in equity securities of public companies. The net gains on sale, which were not material, were recorded through gains on strategic investments, net in the consolidated statements of operations. 4. Fair Value Measurements The following tables present information about our financial instruments that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value: 84 Table of Contents As of January 31, 2026 Fair Value Level 1 Level 2 Level 3 (in thousands) Financial Assets: Money market funds $ 724,236 $ 724,236 $ — $ — Treasury bills 16,876 — 16,876 — Agency bonds 22,298 — 22,298 — Cash equivalents 763,410 724,236 39,174 — Agency bonds 1,095,471 — 1,095,471 — U.S. government agency securities 5,383,887 — 5,383,887 — Treasury bills 64,673 — 64,673 — Marketable securities 6,544,031 — 6,544,031 — Privately held debt securities included in strategic investments 3,968 — — 3,968 Total financial assets $ 7,311,409 $ 724,236 $ 6,583,205 $ 3,968 As of January 31, 2025 Fair Value Level 1 Level 2 Level 3 (in thousands) Financial Assets: Money market funds $ 825,044 $ 825,044 $ — $ — Treasury bills 17,965 — 17,965 — Agency bonds 23,992 — 23,992 — Cash equivalents 867,001 825,044 41,957 — Commercial paper 20,841 — 20,841 — Agency bonds 1,174,484 — 1,174,484 — Corporate and other debt securities 720,795 — 720,795 — U.S. government agency securities 4,415,930 — 4,415,930 — Treasury bills 110,279 — 110,279 — Marketable securities 6,442,329 — 6,442,329 — Publicly held equity securities included in strategic investments 35,280 35,280 — — Privately held debt securities included in strategic investments 4,450 — — 4,450 Total financial assets $ 7,349,060 $ 860,324 $ 6,484,286 $ 4,450 We classify our highly liquid money market funds and publicly held equity securities within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. We classify our commercial paper, agency bonds, corporate and other debt securities, U.S. government agency securities, treasury bills, and certificates of deposit within Level 2 since they are valued using inputs other than quoted prices that are directly or indirectly observable in the market, including readily available pricing sources for the identical underlying security, which may not be actively traded. We classify our privately held debt securities as Level 3 due to the lack of relevant observable market data over fair value inputs. 5. Business Combinations BrightHire, Inc. On December 1, 2025, we acquired 100 % of the issued and outstanding share capital of BrightHire, Inc., a private company providing AI-powered interview intelligence and hiring automation, for all-cash purchase consideration of $ 98.0 million. The acquisition expands Zoom Workplaces’s capabilities in recruiting and candidate engagement. The acquisition was accounted for as a business combination. In allocating the purchase consideration for the acquisition, the following table summarizes the amounts attributed to goodwill, identifiable intangible assets, and other net assets acquired: 85 Table of Contents (in thousands) Goodwill $ 73,657 Identifiable intangible assets 19,900 Other net assets acquired 4,397 Total purchase consideration $ 97,955 The goodwill amount represents synergies related to our existing products expected to be realized from the acquisition and assembled workforce. The associated goodwill is not deductible for tax purposes. The allocation of the purchase price is based upon a preliminary valuation, and as additional information becomes available, our estimates and assumptions may be subject to refinement within the measurement period, which may be up to one year from the acquisition date. Uncertain tax positions are initially established in connection with the acquisition as of the acquisition date. We continue to collect information and reevaluate these estimates and assumptions quarterly. We will record any adjustments to our preliminary estimates to goodwill, provided that it is within the one-year measurement period. The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition: Fair Value Useful Life (in thousands) (years) Developed technology 9,000 5.0 Customer relationships 9,800 5.0 Trade names 1,100 3.0 Identifiable intangible assets $ 19,900 Intangible assets are amortized using the straight-line method over their respective estimated useful lives. Amortization of developed technology is recorded within cost of revenue, and amortization of customer relationships and trade names is recorded within sales and marketing expense in the consolidated statements of operations. Transaction costs incurred in connection with the acquisition were immaterial. The results of operations of BrightHire, Inc., which are not material, have been included in our consolidated financial statements from the date of the acquisition. Pro forma results of operations reflecting the acquisition of BrightHire, Inc. have not been presented, as the results do not have a material effect on any of the periods presented in our consolidated statements of operations. Other Acquisitions During the fiscal year ended January 31, 2026, we also completed other acquisitions that were immaterial and included the results in our consolidated financial statements from the date of the acquisitions. 6. Balance Sheet Components Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: As of January 31, 2026 2025 (in thousands) Prepaid expenses 203,443 166,924 Restricted cash 10,904 12,037 Other 20,509 21,718 Prepaid expenses and other current assets $ 234,856 $ 200,679 86 Table of Contents Property and Equipment, Net Property and equipment, net consisted of the following: As of January 31, 2026 2025 (in thousands) Servers $ 386,702 $ 427,664 Software 157,347 123,259 Computer and office equipment 45,944 47,021 Leasehold improvements 57,761 54,885 Furniture and fixtures 5,706 5,767 Property and equipment, gross 653,460 658,596 Less: accumulated depreciation and amortization ( 388,935 ) ( 328,121 ) Property and equipment, net $ 264,525 $ 330,475 Depreciation and amortization expense was $ 118.9 million, $ 109.1 million, and $ 91.9 million for the fiscal years ended January 31, 2026, 2025, and 2024, respectively. Other Assets, Noncurrent Other assets, noncurrent consisted of the following: As of January 31, 2026 2025 (in thousands) Accounts receivable, noncurrent $ 2,375 $ 19,266 Intangible assets subject to amortization, net 45,997 33,410 Indefinite-lived intangible assets 25,239 25,239 Prepaid expense, noncurrent 35,000 52,156 Income tax receivable, noncurrent 24,276 12,230 Other 11,446 11,772 Other assets, noncurrent $ 144,333 $ 154,073 87 Table of Contents Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: As of January 31, 2026 2025 (in thousands) Accrued expenses $ 192,478 $ 200,416 Accrued compensation and benefits 206,367 193,110 Income tax liabilities 18,947 18,815 Sales and other non-income tax liabilities 41,919 41,755 Customer deposit liabilities 56,734 47,312 Operating lease liabilities, current 27,765 27,026 Other 37,563 30,128 Accrued expenses and other current liabilities $ 581,773 $ 558,562 Other Liabilities, Noncurrent Other liabilities, noncurrent consisted of the following: As of January 31, 2026 2025 (in thousands) Sales and other non-income tax liabilities $ 40,184 $ 41,517 Long-term income tax liabilities 62,771 49,449 Other 6,108 4,397 Other liabilities, noncurrent $ 109,063 $ 95,363 7. Operating Leases We entered into various operating lease agreements for office space, with remaining contractual periods of up to five years . Many of our leases contain one or more options to extend. As leases approach maturity, we consider various factors such as market conditions and the terms of any renewal options that may exist to determine whether we are reasonably certain to exercise the options to extend the lease. Operating lease expense for the fiscal years ended January 31, 2026, 2025 and 2024 was $ 27.0 million, $ 26.7 million and $ 24.9 million , respectively, excluding short-term lease costs, variable lease costs, and sublease income, each of which was immaterial for the fiscal years ended January 31, 2026, 2025 and 2024 . 88 Table of Contents Supplemental balance sheet information related to operating leases was as follows: As of January 31, 2026 2025 (in thousands, except life and percentages) Reported as: Assets: Operating lease right-of-use assets $ 52,423 $ 55,900 Liabilities: Accrued expenses and other current liabilities $ 27,765 $ 27,026 Operating lease liabilities, noncurrent 30,710 37,406 Total operating lease liabilities $ 58,475 $ 64,432 Weighted average remaining lease term 2.7 years 3.3 years Weighted average discount rate 4.8 % 4.4 % Supplemental cash flow and other information related to operating leases was as follows: Year Ended January 31, 2026 2025 2024 (in thousands) Cash payments included in the measurement of our operating lease liabilities $ 30,403 $ 31,197 $ 26,471 Operating lease right-of-use assets recognized in exchange for new operating lease obligations $ 22,111 $ 21,760 $ — As of January 31, 2026, the future minimum lease payments included in the measurement of our operating lease liabilities are as follows: As of January 31, 2026 (in thousands) Year Ending January 31, 2027 $ 26,585 2028 20,504 2029 10,799 2030 3,633 2031 798 Thereafter — Total operating lease payments $ 62,319 Less: imputed interest ( 3,844 ) Total operating lease liabilities $ 58,475 8. Goodwill and Intangible Assets Goodwill The following table summarizes the changes in the carrying amount of goodwill: 89 Table of Contents As of January 31, 2026 2025 (in thousands) Balance, beginning of the year $ 307,295 $ 307,295 Increase in goodwill related to business combinations 93,097 — Balance, ending of the year $ 400,392 $ 307,295 See Note 5 for additional information regarding acquisitions completed during the fiscal year. Intangibles The following table summarizes intangible assets with a finite useful life included within other assets, noncurrent on the consolidated balance sheet: As of January 31, 2026 2025 Gross Carrying Amount Accumulated Amortization Net Value Gross Carrying Amount Accumulated Amortization Net Value (in thousands) Customer relationships $ 41,532 $ ( 20,720 ) $ 20,812 $ 31,732 $ ( 14,044 ) $ 17,688 Technology 42,561 ( 19,501 ) 23,060 26,959 ( 14,080 ) 12,879 Assembled workforce 7,034 ( 5,947 ) 1,087 7,034 ( 4,191 ) 2,843 Trade names 1,100 ( 62 ) 1,038 — — — Total $ 92,227 $ ( 46,230 ) $ 45,997 $ 65,725 $ ( 32,315 ) $ 33,410 Intangible asset amortization expense was $ 13.9 million, $ 13.5 million, and $ 12.5 million for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. Estimated amortization expense for each of the five succeeding fiscal years and thereafter is as follows: As of January 31, 2026 (in thousands) Year Ending January 31, 2027 17,598 2028 12,614 2029 6,581 2030 4,976 2031 4,228 Thereafter — Total amortization expense 45,997 The following table summarizes intangible assets with an indefinite useful life included within other assets, noncurrent on the consolidated balance sheet: As of January 31, 2026 2025 (in thousands) Domain and IP Addresses $ 20,232 $ 20,232 Patents and trade names 5,007 5,007 Total $ 25,239 $ 25,239 For the years ended January 31, 2026, 2025 and 2024, there were no intangible assets impairment losses. 90 Table of Contents 9. Commitments and Contingencies Non-cancelable Purchase Obligations In the normal course of business, we enter into non-cancelable purchase commitments with various parties to purchase primarily software-based services. As of January 31, 2026, we had outstanding non-cancelable purchase obligations with a term of less than 12 months of $ 241.3 million and non-cancelable purchase obligations with a term 12 months or longer of $ 202.9 million. Indemnifications and Contingency Our agreements with certain larger customers include certain provisions for indemnifying customers against liabilities if our services infringe a third party’s intellectual property rights. It is not possible to determine the maximum potential amount under these indemnification obligations due to the limited history of prior indemnification claims and the unique facts and circumstances that may be involved in each particular agreement. To date, we have not incurred any material costs as a result of such provisions and have not accrued any liabilities related to such obligations in our consolidated financial statements. In addition, we have indemnification agreements with our directors and our executive officers that require us, among other things, to indemnify our directors and executive officers for costs associated with any fees, expenses, judgments, fines, and settlement amounts incurred by any of those persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by us, arising out of that person’s services as our director or officer or that person’s services provided to any other company or enterprise at our request. We maintain director and officer insurance coverage that may enable us to recover a portion of any future indemnification amounts paid. To date, there have been no claims under any of our directors’ and executive officers’ indemnification provisions. Sales and Other Tax Liabilities We conduct operations in many tax jurisdictions. In many jurisdictions, non-income-based taxes, such as sales and use tax and other indirect taxes, are assessed on our operations. Although we are diligent in collecting and remitting such taxes, there is uncertainty as to what constitutes sufficient presence for a jurisdiction to levy taxes, fees, and surcharges for sales made over the Internet. As of January 31, 2026 and 2025, we recorded sales and other tax liabilities of $ 82.1 million and $ 83.3 million, respectively, of which $ 41.9 million and $ 41.8 million are included in accrued expenses and other current liabilities, respectively, and $ 40.2 million and $ 41.5 million are included in other liabilities, noncurrent, respectively, in our consolidated balance sheets, based on our best estimate of the probable liability for the loss contingency incurred as of those dates. Our estimate of a probable outcome under the loss contingency is based on analysis of our sales and marketing activities, revenue subject to sales tax, and applicable regulations in applicable jurisdictions in each period. No significant adjustments to the sales and other tax liabilities have been recognized in the accompanying consolidated financial statements for changes to the assumptions underlying the estimate; however, changes in our assumptions may occur in the future as we obtain new information, which can result in adjustments to the recorded liability. 91 Table of Contents Legal Proceedings In June 2020, we received a grand jury subpoena from the Department of Justice’s U.S. Attorney’s Office for Eastern District of New York (“EDNY”), which requested information regarding our interactions with foreign governments and foreign political parties, including the Chinese government, as well as information regarding storage of and access to user data, the development and implementation of Zoom’s privacy policies, and the actions we took responding to law enforcement requests from the Chinese government. In July 2020, we received subpoenas from the Department of Justice’s U.S. Attorney’s Office for the Northern District of California (“NDCA”) and the SEC. Both subpoenas sought documents and information relating to various security, data protection and privacy matters, including our encryption, and our statements relating thereto, as well as calculation of usage metrics and related public statements. In addition, the NDCA subpoena sought information relating to any contacts between our employees and representatives of the Chinese government, and any attempted or successful influence by any foreign government in our policies, procedures, practices, and actions as they relate to users in the United States. We have since received additional subpoenas from EDNY and NDCA seeking related information. We are fully cooperating with all of these investigations and have conducted our own thorough internal investigation. During the fiscal year ended January 31, 2025, we recorded an $ 18.0 million accrual with respect to a tentative settlement offer for the SEC matter. On July 30, 2025, the SEC informed us that their investigation has concluded and they do not intend to recommend an enforcement action. As a result, during the three months ended July 31, 2025, we reversed the $ 18.0 million previously accrued. The EDNY and NDCA investigations are ongoing, and a negative outcome in any or all of these matters could cause us to incur substantial fines, penalties, or other financial exposure, as well as reputational harm. We do not know when the EDNY and NDCA matters will be completed, which facts we will ultimately discover as a result of the investigations, or what actions the government may or may not take. We are unable to predict the ultimate outcome of these matters and are unable to reasonably estimate any range of possible loss for these matters. On June 11, 2020 and July 30, 2020, purported shareholder derivative complaints were filed in the United States District Court for the District of Delaware against certain of our officers and directors. The lawsuits asserted state and federal claims and were based on the same alleged misstatements as the shareholder class action complaint. The lawsuits accused our board of directors of failing to exercise reasonable and prudent supervision over our management, policies, practices, and internal controls. The plaintiffs sought unspecified monetary damages on behalf of us as well as governance reforms. On September 25, 2020, the derivative cases were consolidated. On October 27, 2021, a third substantially identical lawsuit was filed in the same court against the same defendants, seeking unspecified monetary damages and governance reforms. On November 17, 2021, all three derivative lawsuits were consolidated. The consolidated case was stayed pending resolution of the motion to dismiss the securities class action. On April 11, 2023, the court entered a stipulated order that required defendants to answer, move, or otherwise respond to the operative complaint by June 12, 2023. On June 12, 2023, defendants filed a motion to dismiss the consolidated case. On August 11, 2023, the plaintiff in the consolidated case filed an amended complaint. On October 18, 2023, defendants filed their motion to dismiss the amended complaint. On December 22, 2023, plaintiff filed her opposition to the motion to dismiss, and on January 26, 2024, defendants filed their reply in support of the motion to dismiss. On April 1, 2024, the parties notified the court that the parties were engaged in good-faith, material settlement discussions, and requested that the court stay any proceedings and rulings in connection with the pending motion to dismiss while the parties attempted to reach a proposed resolution of this action. On April 2, 2024, the Court stayed the case. On January 14, 2025, the parties executed a Stipulation of Settlement (“Stipulation”) to resolve this matter. Under the terms of the Stipulation, in exchange for the release and dismissal with prejudice of all claims against all defendants in the matter, Zoom agreed to enact certain corporate governance reforms and to pay plaintiff’s counsel a fee of up to $ 1.35 million. On January 16, 2025, the plaintiff filed a motion for preliminary approval of the settlement. On February 6, 2025, the court held a hearing on the motion for preliminary approval of the settlement. On April 16, 2025, the court preliminarily approved the settlement. On June 24, 2025, the plaintiff filed a motion for final approval of the settlement. On July 31, 2025, the court approved the settlement and awarded plaintiff’s counsel $ 1.35 million in fees. We accrued the $ 1.35 million fee and recorded it as a general and administrative expense in our consolidated statement of operations for the year ended January 31, 2025. On April 7, 2020 and April 8, 2020, securities class action complaints were filed against us and two of our officers in the United States District Court for the NDCA. The plaintiffs are purported stockholders of ours. The complaints allege, among other things, that we violated Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 by making false and misleading statements and omissions of material fact about our data privacy and security measures. The complaints seek unspecified damages, interest, fees, and costs. On May 18, 2020, the actions were consolidated. On November 4, 2020, the court appointed a lead plaintiff. On December 23, 2020, the lead plaintiff filed a consolidated complaint. We filed a motion to dismiss the consolidated complaint on May 20, 2021. Plaintiff filed an opposition to our motion to dismiss on July 9, 2021. Our reply in support of the motion to dismiss was filed on August 9, 2021. On February 16, 2022, the court granted in part, and denied in part, our motion to dismiss. On March 14, 2022, we moved for reconsideration of the court’s ruling on the motion to dismiss. On March 22, 2022, the court ordered plaintiff to respond to our motion, which plaintiff did on March 29, 2022. On April 22, 2022, we answered the complaint. On March 8, 2023, the court denied our motion for reconsideration. On April 6, 2023, the court entered a scheduling order. On July 17, 2023, the parties entered into a stipulation and agreement of settlement (the 92 Table of Contents “Stipulation”) to resolve this matter. Under the terms of the stipulation, in exchange for the release and dismissal with prejudice of all claims against all defendants in the matter, we have agreed to pay and/or cause our insurance carriers to pay a total of $ 150.0 million. On July 25, 2023, the court entered an order staying further proceedings in the matter pending the filing of a motion for preliminary approval of the settlement. On October 17, 2023, lead plaintiff filed a motion for preliminary approval of the settlement. On May 28, 2025, the court preliminarily approved the settlement. On July 18, 2025, lead plaintiff filed a motion for final approval of the settlement. On October 9, 2025, the court conducted a fairness hearing and indicated that lead plaintiff’s motion for final approval of the settlement would be granted by a separate order. On November 10, 2025, the court entered its final approval order and an order finally dismissing the matter with prejudice. As a result of the settlement, we made net payments of $ 60.0 million ($ 150.0 million for the settlement net of $ 90.0 million covered by insurance) during the year ended January 31, 2024, of which $ 7.5 million had been accrued during the year ended January 31, 2023 and $ 52.5 million was recorded as a general and administrative expense in our consolidated statement of operations for the year ended January 31, 2024. In addition, from time to time, we are involved in various other legal proceedings arising from the normal course of business activities. We are not presently a party to any other such litigation the outcome of which, we believe, if determined adversely to us, would individually, or taken together, have a material adverse effect on our business, operating results, cash flows, or financial condition. Defending such proceedings is costly and can impose a significant burden on management and employees. We may receive unfavorable preliminary or interim rulings in the course of litigation, and there can be no assurances that favorable final outcomes will be obtained. 10. Stockholders’ Equity and Equity Incentive Plans Dual-Class Common Stock Structure In November 2018, we implemented a dual class common stock structure pursuant to which all the then-outstanding shares of our common stock were reclassified as Class B common stock and a new class of Class A common stock was authorized. The Class A common stock is entitled to one vote per share and the Class B common stock is entitled to 10 votes per share. The Class A and Class B common stock have the same dividend and liquidation rights. Each share of Class B common stock will automatically convert into one share of Class A common stock upon (a) any transfer of such share, except for certain permitted transfers described in our amended and restated certificate of incorporation and (b) the death of the holder of such share. In addition, each share of Class B common stock will be automatically converted into one share of Class A common stock upon the earliest of (a) the date that is six months following the death or incapacity of Eric S. Yuan (our CEO), (b) the date that is six months following the date that Mr. Yuan is no longer providing services to us or his employment is terminated for cause, (c) the date specified by the holders of a majority of the then-outstanding shares of convertible preferred stock, voting together on an as-converted basis, and the holders of a majority of the then-outstanding shares of Class B common stock, voting as a separate class, and (d) the 15 -year anniversary of the closing of our IPO. In connection with the implementation of the dual-class common stock structure, each then-outstanding share of our convertible preferred stock became convertible into one share of Class B common stock, and all outstanding options to purchase shares of common stock became options to purchase an equivalent number of shares of Class B common stock. Upon the effectiveness of the amended and restated certificate of incorporation in November 2018, the number of shares of common stock that are authorized to be issued consisted of 320,000,000 shares of Class A common stock, $ 0.001 par value per share and 300,000,000 shares of Class B common stock, $ 0.001 par value per share. Class A and Class B common stock are collectively referred to as “common stock” throughout the notes to the consolidated financial statements, unless otherwise noted. Common Stock Upon the completion of the IPO in April 2019, our amended and restated certificate of incorporation became effective, which also authorized the issuance of 2,000,000,000 shares of Class A common stock, $ 0.001 par value per share and 300,000,000 shares of Class B common stock, $ 0.001 par value per share. 93 Table of Contents We have the following shares of Class A common stock reserved for future issuance: As of January 31, 2026 2025 Stock options outstanding 1,542,753 2,394,918 RSUs outstanding 20,106,305 23,870,513 ESPP purchase rights outstanding 1,293,529 2,311,567 Remaining shares available for future issuance under the 2011 and 2019 plan 66,954,929 56,022,675 Remaining shares available for future issuance under the ESPP 20,664,260 18,807,595 Total shares of Class A common stock reserved 110,561,776 103,407,268 Stock Repurchase Plan In February 2024, our Board of Directors authorized a stock repurchase program of up to $ 1.5 billion of our Class A common stock. In November 2024, our Board of Directors authorized the repurchase of an additional $ 1.2 billion of our outstanding Class A common stock. In November 2025, our Board of Directors authorized the repurchase of an additional $ 1.0 billion of our outstanding Class A common stock. Repurchases of our Class A common stock may be effected from time to time, either on the open market (including preset trading plans), in privately negotiated transactions, and other transactions in accordance with applicable securities laws. The program does not obligate us to repurchase any specific number of shares and may be discontinued at any time. During the fiscal year ended January 31, 2026, we repurchased and subsequently retired 20,385,361 shares of our Class A common stock for an aggregate amount of $ 1.6 billion. As of January 31, 2026, $ 1.0 billion of the repurchase authorization remained available. Equity Incentive Plans In 2011, we adopted the 2011 Global Share Plan (“2011 Plan”), under which officers, employees, and consultants were granted various forms of equity incentive compensation at the discretion of the board of directors, including stock options and restricted stock awards. In connection with the IPO, the shares of Class B common stock remaining available for issuance under the 2011 Plan became available for issuance for a corresponding number of shares of our Class A common stock under the 2019 Equity Incentive Plan (“2019 Plan”), which is a successor to and continuation of our 2011 Plan. In April 2019, we adopted the 2019 Plan, which became effective in connection with our IPO. Our 2019 Plan provides for the grant of stock options, stock appreciation rights, RSU awards, performance awards, and other forms of awards. The awards generally vest over four years . The plan administrator determines the term of stock options granted under the 2019 Plan, up to a maximum of 10 years. The maximum number of shares of our Class A common stock that may be issued under our 2019 Plan will not exceed 58,300,889 shares of our Class A common stock, which is the sum of (1) 34,000,000 new shares, plus (2) an additional number of shares not to exceed 24,300,889 , consisting of (A) shares that remain available for the issuance of awards under our 2011 Plan as of immediately prior to the time our 2019 Plan becomes effective and (B) shares of Class B common stock subject to outstanding stock options or other stock awards granted under our 2011 Plan that, on or after the 2019 Plan became effective, terminate, or expire prior to exercise or settlement; are not issued because the award is settled in cash; are forfeited because of the failure to vest; or are reacquired or withheld (or not issued) to satisfy a tax withholding obligation or the purchase or exercise price, if any, as such shares become available from time to time. In addition, the number of shares of our Class A common stock reserved for issuance under our 2019 Plan automatically increases on February 1 of each calendar year, starting on February 1, 2020 through February 1, 2029, in an amount equal to (i) 5 % of the total number of shares of our common stock (both Class A and Class B) outstanding on January 31 of the fiscal year before the date of each automatic increase or (ii) a lesser number of shares determined by our board of directors prior to the applicable February 1. 94 Table of Contents Stock Options A summary of stock option activity under our equity incentive plan and related information is as follows: Stock Options Outstanding Stock Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life (Years) Aggregate Intrinsic Value (in thousands, except share, life and per share data) Outstanding as of January 31, 2025 2,394,918 $ 9.02 2.6 $ 187,284 Exercised ( 842,567 ) $ 2.95 $ 66,978 Canceled/forfeited/expired ( 9,598 ) $ 94.87 Outstanding and Exercisable as of January 31, 2026 1,542,753 $ 11.81 2.2 $ 124,080 There were no options granted for the fiscal years ended January 31, 2026, 2025 and 2024. The intrinsic value of the options exercised, which represents the difference between the fair market value of our common stock on the date of exercise and the exercise price of each option, was $ 67.0 million, $ 62.1 million, and $ 90.0 million during the fiscal years ended January 31, 2026, 2025, and 2024, respectively. As of January 31, 2026, all options have vested and there is no unrecognized stock-based compensation expense remaining. Restricted Stock Units A summary of RSU activity under our equity incentive plan and related information is as follows: RSUs Unvested RSUs Weighted-Average Grant Date Fair Value Per Share Unvested as of January 31, 2025 23,870,513 $ 73.48 Granted 10,695,967 $ 80.21 Vested ( 11,309,015 ) $ 76.45 Forfeited ( 3,151,160 ) $ 72.94 Unvested as of January 31, 2026 20,106,305 $ 75.51 As of January 31, 2026, unrecognized stock-based compensation expense related to outstanding unvested RSUs was $ 1,391.3 million, which is expected to be recognized over a weighted-average period of 2.8 years. 2019 Employee Stock Purchase Plan In April 2019, we adopted the 2019 ESPP, which became effective in connection with the IPO. A total of 9,000,000 shares of our Class A common stock were initially reserved for issuance under the ESPP. The number of shares of our Class A common stock reserved for issuance automatically increases on February 1 of each calendar year, beginning on February 1, 2020 through February 1, 2029, by the lesser of (1) 1 % of the total number of shares of our common stock (both Class A and Class B) outstanding on the last day of the fiscal year before the date of the automatic increase, and (2) 7,500,000 shares; provided that before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth in clauses (1) and (2). Under our current ESPP, Class A common stock will be purchased for the accounts of employees participating in the ESPP at a price per share equal to the lesser of (1) 85 % of the fair market value of a share of our Class A common stock on the first date of an offering or (2) 85 % of the fair market value of a share of our Class A common stock on the date of purchase. No employee may purchase shares under the ESPP at a rate in excess of $ 25,000 worth of our Class A common stock based on the fair market value per share of our Class A common stock at the beginning of an offering for each calendar year such purchase right is outstanding or 3,000 shares. The 2019 ESPP provides for, at maximum, 27 months offering periods with four offering dates, generally in June and December of each year. The first offering period began on April 18, 2019. During the fiscal years ended January 31, 2026, 2025, and 2024, 1,200,743 , 1,066,977 , and 921,892 shares, respectively, of our Class A common stock were purchased under the ESPP. As of January 31, 2026, unrecognized stock-based compensation expense related to the ESPP was $ 15.5 million, which is expected to be recognized over a weighted-average period of 1.1 years. 95 Table of Contents We estimated the fair value of ESPP purchase rights using a Black-Scholes option-pricing model with the following assumptions: Year Ended January 31, 2026 2025 2024 Expected term (years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility 31.2 % - 33.0 % 28.4 % - 43.3 % 30.0 % - 57.6 % Risk-free interest rate 3.5 % - 4.3 % 4.2 % - 5.4 % 4.6 % - 5.4 % Expected dividend yield — — — Shares Reserved for Charitable Donations During fiscal year 2020, our board of directors approved the issuance of 500,000 shares of Class A common stock for the sole purpose of being transferred to nonprofit organizations. Prior to fiscal year 2026, we transferred a total of 94,844 shares to a donor-advised fund through an unaffiliated nonprofit organization. For the fiscal year ended January 31, 2026, 240,964 shares of Class A common stock were transferred to the same organization. As of January 31, 2026, 164,192 shares remain available for future issuance under this authorization. We recorded a non-cash charge of $ 20.9 million for the fair value of the donated shares, which was recorded in general and administrative expense in the consolidated statements of operations for the fiscal year ended January 31, 2026. Stock-Based Compensation The stock-based compensation expense by line item in the accompanying consolidated statements of operations is summarized as follows: Year Ended January 31, 2026 2025 2024 (in thousands) Cost of revenue $ 96,273 $ 124,561 $ 143,798 Research and development 287,172 333,767 336,309 Sales and marketing 254,976 319,631 381,298 General and administrative 122,355 153,350 195,756 Total stock-based compensation expense 760,776 931,309 1,057,161 Benefit from income taxes ( 143,661 ) ( 176,463 ) ( 197,068 ) Total stock-based compensation expense recorded to net income $ 617,115 $ 754,846 $ 860,093 11. Income Taxes The components of net income before the provision for income taxes were as follows: Year Ended January 31, 2026 2025 2024 (in thousands) Domestic $ 2,317,100 $ 1,238,452 $ 792,495 Foreign 105,185 77,132 39,817 Total $ 2,422,285 $ 1,315,584 $ 832,312 The provision for income taxes was as follows: 96 Table of Contents Year Ended January 31, 2026 2025 2024 (in thousands) Current: Federal $ 342,568 $ 323,625 $ 257,913 State 52,041 52,186 44,457 Foreign 22,493 20,086 9,159 Total current income tax expense 417,102 395,897 311,529 Deferred: Federal 100,104 ( 78,476 ) ( 88,110 ) State 2,416 ( 12,875 ) ( 20,201 ) Foreign 2,515 800 ( 8,368 ) Total deferred income tax expense 105,035 ( 90,551 ) ( 116,679 ) Total provision for income taxes $ 522,137 $ 305,346 $ 194,850 A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S. federal income tax rate to income before income taxes after the adoption of ASU 2023-09 is as follows: Year Ended January 31, 2026 (in thousands, except percentages) Amount Percent US federal statutory tax rate $ 508,680 21.0 % State and local income tax, net of federal income tax effect (a) 39,700 1.6 Foreign tax effects Other foreign jurisdictions 2,422 0.1 Effect of cross-border tax laws Foreign-derived intangible income deduction ( 42,360 ) ( 1.7 ) Other effect of cross-border tax laws ( 2,705 ) ( 0.1 ) Nontaxable or nondeductible items Stock-based compensation (b) 25,274 1.0 Tax credits Research and development tax credits ( 34,347 ) ( 1.4 ) Changes in valuation allowance 5,503 0.2 Changes in unrecognized tax benefits 16,065 0.7 Other 3,905 0.2 Effective tax rate $ 522,137 21.6 % (a) The jurisdictions that contribute to the majority of the tax effect in this category are California, Massachusetts, New Jersey, New York, and Virginia. (b) Includes amounts related to non-deductible stock-based compensation, including non-deductible executive compensation, in addition to excess tax benefits or shortfalls from stock-based compensation. Out of total stock-based compensation, $ 36.8 million is related to excess tax benefits on current year vested and exercised awards. A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S. federal income tax rate to income before income taxes for years prior to the adoption of ASU 2023-09 is as follows: 97 Table of Contents Year Ended January 31, 2025 2024 (in thousands, except percentages) Tax at federal statutory rate $ 276,270 $ 174,785 State taxes 56,336 37,137 Foreign rate differential 141 2,943 Non-deductible compensation 15,757 10,639 Stock-based compensation 58,770 96,936 Permanent items 10,371 4,016 Foreign-derived intangible income deduction ( 56,630 ) ( 63,571 ) Research and development credits ( 49,813 ) ( 39,226 ) Tax uncertainties 7,478 2,674 Change in valuation allowance ( 7,765 ) ( 14,109 ) Deferred rate change ( 3,993 ) ( 6,803 ) Other ( 1,576 ) ( 10,570 ) Total $ 305,346 $ 194,850 Effective tax rate 23.2 % 23.4 % Deferred income taxes result from differences in the recognition of amounts for tax and financial reporting purposes, as well as operating loss and tax credit carryforwards. Significant components of our deferred income tax assets as of January 31, 2026 and 2025 are as follows: As of January 31, 2026 2025 (in thousands) Deferred tax assets: Net operating loss carryforwards $ 13,433 $ 7,362 Research and development credit carryforwards 5,083 6,586 Stock-based compensation 29,866 59,565 Accruals and reserves 42,279 43,953 Deferred revenue 343,910 328,114 Capitalized research expenditures 635,974 514,667 Operating lease liabilities 13,885 16,551 Other assets 10,135 2,957 Total deferred tax assets 1,094,565 979,755 Valuation allowance ( 11,026 ) ( 28,990 ) Total deferred tax assets net of valuation allowance 1,083,539 950,765 Deferred tax liabilities: Property and equipment and intangible assets ( 34,466 ) ( 38,343 ) Deferred contract acquisition costs ( 79,421 ) ( 76,439 ) Operating right-of-use assets ( 12,099 ) ( 14,233 ) Strategic investments ( 313,698 ) ( 75,290 ) Total deferred tax liabilities ( 439,684 ) ( 204,305 ) Net deferred tax assets $ 643,855 $ 746,460 The realization of tax benefits of net deferred tax assets is dependent upon future levels of taxable income, of an appropriate character, in the periods the items are expected to be deductible or taxable. Based on the available objective evidence during the year ended January 31, 2026, we maintained a valuation allowance against certain equity investment deferred tax assets for both U.S. federal and state income tax purposes and intend to maintain the applicable valuation 98 Table of Contents allowance until sufficient positive evidence exists to support a reversal of, or decrease in, the valuation allowance. With respect to California state income taxes, after evaluating all available positive and negative evidence, we concluded that it is more likely than not that the California net deferred tax assets, other than those related to certain equity investments, will be realized. Accordingly, during the year ended January 31, 2026, we released the valuation allowance previously recorded against the California net deferred tax assets and recognized a non-recurring income tax benefit of $ 24.4 million related to the reversal. As of January 31, 2026, we had net operating loss carryforwards of approximately $ 30.1 million for federal income tax purposes, which can be carried forward indefinitely. We also had $ 35.8 million of net operating loss carryforwards for state income tax purposes, which will begin to expire in the year 2036 if unused. The federal and state net operating loss carryforwards may be subject to significant limitations under Section 382 and Section 383 of the Internal Revenue Code of 1986 and similar provisions under state law. Such provisions limit the net operating loss carryforwards that may be used in any given year in the event of special occurrences, including significant ownership changes. We also had certain foreign net operating loss carryforwards of $ 19.6 million, which have an indefinite life. As of January 31, 2026, we had research and development credit carryforwards of approximately $ 0.2 million for federal income tax purposes and $ 26.0 million for state income tax purposes. The federal research and development tax credits have a twenty-year carryover period, while the state research and development tax credits carry forward indefinitely. We indefinitely reinvest earnings from our foreign subsidiaries; therefore, no deferred tax liability has been recognized on the basis difference created by such earnings. A reconciliation of the beginning and ending balance of total unrecognized tax benefits is as follows: Unrecognized Tax Benefits (in thousands) Year Ended January 31, 2026 2025 2024 Balance, beginning of year $ 56,334 $ 41,772 $ 30,404 Tax Positions taken in prior year: Gross increases 1,082 931 228 Gross decreases ( 330 ) — — Tax Positions taken in current year: Gross increases 11,280 13,650 12,415 Gross decreases — ( 19 ) ( 891 ) Lapse of Statute of Limitations — — ( 384 ) Settlements ( 209 ) — — Balance, end of year $ 68,157 $ 56,334 $ 41,772 As of January 31, 2026, gross unrecognized tax benefits related to uncertain tax positions were $ 68.2 million ($ 82.5 million total, including $ 14.3 million associated with interest and penalties). As of January 31, 2025, gross unrecognized tax benefits related to uncertain tax positions were $ 56.3 million ($ 66.0 million total, including $ 9.7 million associated with interest and penalties). As of January 31, 2024, gross unrecognized tax benefits related to uncertain tax positions were $ 41.8 million ($ 46.5 million total, including $ 4.7 million associated with interest and penalties). We recognized approximately $ 14.3 million, $ 9.7 million, and $ 4.7 million in potential interest and penalties associated with uncertain tax positions during fiscal years ended January 31, 2026, 2025, and 2024, respectively. To the extent taxes are not assessed with respect to uncertain tax positions, substantially all amounts accrued (including interest and penalties) will be reduced and reflected as a reduction of the overall income tax provision. Unrecognized tax benefits and associated accrued interest and penalties are included in our income tax provision. We file income tax returns in the U.S. federal jurisdiction, various state jurisdictions, and various foreign jurisdictions. As of January 31, 2026, all of the years in which net operating losses or tax credits were utilized remain open to examination by the federal and state tax authorities. The amounts of cash income taxes we paid, net of amounts refunded, were as follows: 99 Table of Contents Year Ended January 31, 2026 (in thousands) Federal $ 332,500 State and local 67,178 Foreign 21,927 Income taxes, net of amounts refunded $ 421,605 The amounts of cash income taxes we paid, net of amounts refunded, during the fiscal years ended January 31, 2025 and 2024 were $ 395.4 million and $ 348.1 million, respectively. 12. Net Income Per Share The following table sets forth the computation of basic and diluted net income per share for the periods presented: Year Ended January 31, 2026 2025 2024 Class A Class B Class A Class B Class A Class B Numerator: (in thousands, except share and per share data) Net income, basic $ 1,679,924 $ 220,224 $ 861,755 $ 148,483 $ 538,554 $ 98,908 Reallocation of net income ( 5,267 ) 5,267 ( 5,170 ) 5,170 ( 4,653 ) 4,653 Net income, diluted $ 1,674,657 $ 225,491 $ 856,585 $ 153,653 $ 533,901 $ 103,561 Denominator: Weighted-average shares used in computing net income per share, basic 265,676,002 34,827,785 262,715,505 45,266,466 254,084,540 46,663,622 Weighted-average shares used in computing net income per share, diluted 270,861,859 36,471,326 267,148,873 47,920,709 258,398,674 50,121,223 Net income per share, basic $ 6.32 $ 6.32 $ 3.28 $ 3.28 $ 2.12 $ 2.12 Net income per share, diluted $ 6.18 $ 6.18 $ 3.21 $ 3.21 $ 2.07 $ 2.07 The potential shares of common stock that were excluded from the computation of diluted net income per share for the periods presented because including them would have been anti-dilutive are as follows: Year Ended January 31, 2026 2025 2024 Class A Class B Class A Class B Class A Class B Outstanding stock options 86,576 — 95,963 — 109,441 — Unvested RSUs 1,550,584 — 8,082,027 — 9,124,205 — Purchase rights committed under the ESPP 312,869 — 1,236,530 — 1,789,166 — Total 1,950,029 — 9,414,520 — 11,022,812 — For the years ended January 31, 2026, 2025, and 2024, the table above does not include 164,192 of issued Class A common stock held by us that are reserved for the sole purpose of being transferred to nonprofit organizations. 13. Segment Information Our CEO is the Chief Operating Decision Maker (“CODM”) of the Company. The Company manages the business activities on a consolidated basis and all information provided to and reviewed by our CODM is compiled at the consolidated entity level. Therefore, we have only one operating and reportable segment. The description of the types of products and services from which the reportable segment derives its revenue is the same as those described in the Summary of Business and Significant Accounting Policies. The measure of segment profit or loss that our CODM uses to allocate resources and assess performance is our consolidated net income. The CODM uses net income to monitor results and to decide whether to reinvest profits. Our CODM does not assess segment performance or make decisions using asset or liability information. 100 Table of Contents The following table summarizes the significant segment expenses regularly provided to the CODM as well as other segment items: Year Ended January 31, 2026 2025 2024 Revenue $ 4,868,769 $ 4,665,433 $ 4,527,224 Adjusted cost of revenue (1) 987,252 984,916 908,283 Adjusted research and development (1) 545,301 500,177 430,117 Adjusted sales and marketing (1) 1,113,432 1,090,294 1,116,356 Adjusted general and administrative (1) 255,594 252,152 297,580 Stock-based compensation expense 760,776 931,309 1,057,161 Interest income ( 317,246 ) ( 340,474 ) ( 210,009 ) Other segment items (2) ( 898,625 ) ( 68,525 ) 95,424 Provision for income taxes 522,137 305,346 194,850 Segment net income 1,900,148 1,010,238 637,462 Adjustments and reconciling items — — — Consolidated net income $ 1,900,148 $ 1,010,238 $ 637,462 (1) Excludes stock-based compensation expense and related payroll taxes, expenses related to charitable donation of common stock, impairment of assets, acquisition-related expenses, restructuring expenses, and litigation settlements, net. (2) Includes stock-based compensation related payroll taxes, expenses related to charitable donation of common stock, impairment of assets, acquisition-related expenses, restructuring expenses, litigation settlements, net, gains on strategic investments, net, and other income, net excluding interest income. The following table presents our property and equipment, net of depreciation and amortization, by geographic region: As of January 31, 2026 2025 (in thousands) Americas $ 194,952 $ 238,328 APAC 32,820 51,036 EMEA 36,753 41,111 Total property and equipment, net $ 264,525 $ 330,475 Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.