DROPBOX INC

Previous wording

By solving these universal problems, we’ve become invaluable to our users. The popularity of our platform allows us to scale efficiently. We’ve built a thriving global business with 18.22 million paying users.

Current wording

By solving these universal problems, we’ve become invaluable to our users. The popularity of our platform allows us to scale efficiently. We’ve built a thriving global business with 18.24 million paying users.

Previous wording

We offer a range of paid subscription plans, from Plus, Professional, Essentials and Family for individuals to Standard, Advanced, Business, Business Plus and Enterprise for teams. We analyze usage patterns within our network and run hundreds of targeted marketing campaigns to encourage paying users to upgrade their plans. We prompt individual subscribers who collaborate with others on Dropbox to purchase our Standard, Advanced or Business, and Business Plus plans for a better team experience, and we also encourage existing Dropbox Business teams to purchase additional licenses or to upgrade to premium subscription plans. We also aim to offer additional products that expand our content collaboration capabilities, such as through our acquisitions of Dropbox Sign, DocSend and FormSwift.

Current wording

We offer a range of paid subscription plans, from Plus, Professional, Essentials and Family for individuals to Standard, Advanced, Business, Business Plus and Enterprise for teams. We analyze usage patterns within our network and run hundreds of targeted marketing campaigns to encourage paying users to upgrade their plans. We prompt individual subscribers who collaborate with others on Dropbox to purchase our Standard, Advanced or Business, and Business Plus plans for a better team experience, and we also encourage existing Dropbox Business teams to purchase additional licenses or to upgrade to premium subscription plans. We also aim to offer additional products that expand our content collaboration capabilities, such as Dropbox Sign, DocSend and FormSwift, each of which we acquired.

Previous wording

During the three and six months ended June 30, 2024, we did not recognize any impairment charges. During the three and six months ended June 30, 2023, we recognized $2.2 million of impairment charges for right-of-use assets and other lease related property and equipment assets. See Note 8, "Leases" for additional information. We may incur additional impairment charges depending on the state of the corporate real estate market or shifts in our Virtual First strategy.

Current wording

During the three and nine months ended September 30, 2024, we did not recognize any impairment charges. During the three and nine months ended September 30, 2023, we recognized zero and $2.2 million of impairment charges for right-of-use assets and other lease related property and equipment assets, respectively. See Note 9, "Leases" for additional information. We may incur additional impairment charges depending on the state of the corporate real estate market or shifts in our Virtual First strategy.

Previous wording

Our results of operations and cash flows are also subject to fluctuations due to changes in foreign currency exchange rates relative to U.S. dollars, our reporting currency, as well as changes in interest rates. Volatile market conditions, directly or indirectly related to macroeconomic or geopolitical events, have, at times, and may in the future negatively impact our results of operations and cash flows. Conversely, we have seen and may continue to see cost savings from the shift to remote and distributed work for all of our employees in areas including events, travel, utilities, and other benefits. Due to our subscription-based business model, any impact of the current macroeconomic environment on our business, particularly as a result of changes in our customer behavior, may not be fully reflected in our results of operations until future periods, if at all. For a further discussion of the potential impacts of the macroeconomic environment on our business, see “Risk Factors” included in Part II, Item 1A. of this report.

Current wording

We have seen and may continue to see cost savings from the shift to remote and distributed work for all of our employees in areas including events, travel, utilities, and other benefits. Due to our subscription-based business model, any impact of the current macroeconomic environment on our business, particularly as a result of changes in our customer behavior, may not be fully reflected in our results of operations until future periods, if at all. For a further discussion of the potential impacts of the macroeconomic environment on our business, see “Risk Factors” included in Part II, Item 1A. of this report.

Previous wording

In April 2024, we became aware of unauthorized access to the Dropbox Sign production environment, as previously disclosed in our Form 8-K filed with the Securities and Exchange Commission on May 1, 2024. While we remain subject to various risks due to the incident, including ongoing litigation and regulatory scrutiny, as of the date of this filing, it has not had, and we do not believe it is likely to have, a material impact on Dropbox’s overall financial condition or results of operations.

Current wording

In April 2024, we became aware of unauthorized access to the Dropbox Sign production environment, as previously disclosed in our Form 8-K filed with the Securities and Exchange Commission on May 1, 2024. While we remain subject to various risks due to the incident, including ongoing litigation and regulatory scrutiny, as of the date of this filing, it has not had, and no facts have come to light indicating that it is likely to have, a material impact on Dropbox’s overall financial condition or results of operations.

Previous wording

Our ARR fluctuates and may decline in some periods as compared to prior periods. ARR increased in the second quarter of 2024 as compared to the first quarter of 2024 as a result of growth in our Individual plans. We expect to drive ARR growth, however the pace of our future growth may be lower relative to prior periods.

Current wording

Our ARR fluctuates and may decline in some periods as compared to prior periods. ARR increased in the third quarter of 2024 as compared to the second quarter of 2024 as a result of growth in our Individual plans. We expect our ARR growth to moderate in the near term as we face headwinds stemming from a challenging operating environment, particularly as it relates to our Teams plans.

Previous wording

For FormSwift and DocSend, we define paying users as the number of users who have active paid licenses for access to our platform as of the end of the period.

Current wording

For DocSend and FormSwift, we define paying users as the number of users who have active paid licenses for access to our platform as of the end of the period.

Previous wording

The number of paying users as of June 30, 2024 grew as compared to December 31, 2023 and June 30, 2023, largely from an increase in paying users in Individual plans. However, our overall paying user growth rate has declined and may decline in the future.

Current wording

The number of paying users as of September 30, 2024 grew as compared to December 31, 2023 and September 30, 2023, largely from an increase in paying users in Individual plans and from our acquisition of Reclaim offset by a decrease in paying users due to downsell pressures across our Teams plans. However, our overall paying user growth rate has declined and may decline in the future.

Previous wording

The total number of paying users fluctuates and may increase in some periods as compared to prior periods. For example, paying users increased in the second quarter of 2024 as compared to the first quarter of 2024 primarily as a result of our individual plans performance. We expect to drive paying user growth, however the pace of our future growth may be lower relative to prior periods.

Current wording

The total number of paying users fluctuates and may increase in some periods as compared to prior periods. For example, paying users increased slightly in the third quarter of 2024 as compared to the second quarter of 2024. We expect to drive paying user growth, however the pace of our future growth may be lower relative to prior periods.

Previous wording

As a result of an increased mix of sales towards our higher priced plans, as well as a shift to monthly subscription plans, which have a higher price point than our annual plans, we experienced an increase in our average revenue per paying user for the three and six months ended June 30, 2024, compared to the three and six months ended June 30, 2023.

Current wording

As a result of an increased mix of sales towards our higher priced plans, as well as a shift to monthly subscription plans, which have a higher price point than our annual plans, we experienced an increase in our average revenue per paying user for the three and nine months ended September 30, 2024, compared to the three and nine months ended September 30, 2023.

Previous wording

The below table sets forth our ARPU for the three and six months ended June 30, 2024 and 2023.

Current wording

The below table sets forth our ARPU for the three and nine months ended September 30, 2024 and 2023.

Previous wording

Our FCF increased for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, primarily due to an increase in cash provided by operating activities for the reasons discussed below, including payments related to our reduction in workforce in 2023, partially offset by an increase in capital expenditures.

Current wording

Our FCF increased for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, primarily due to an increase in cash provided by operating activities from increased subscription sales, as a majority of our paying users are invoiced in advance, and payments related to our 2023 reduction in workforce, partially offset by an increase in capital expenditures.

Previous wording

We expect our FCF to generally increase in future periods as we increase subscription sales and drive operating efficiencies. We expect to continue to purchase infrastructure equipment to support our user base and anticipate that our capital expenditures will generally remain consistent in future periods as we continue to invest in our internal infrastructure, network and security. The timing of our operating expenses as described below, may cause FCF to vary from period to period as a percentage of revenue.

Current wording

We expect our FCF to generally increase in the near term as we drive operating efficiencies, partly due to our 2024 reduction in workforce. We expect to continue to purchase infrastructure equipment to support our user base and anticipate that our capital expenditures will generally remain consistent in future periods as we continue to invest in our internal infrastructure, network and security. The timing of our operating expenses as described below, may cause FCF to vary from period to period as a percentage of revenue.

Previous wording

Gross margin. Gross margin is gross profit expressed as a percentage of revenue. Our gross margin may fluctuate from period to period based on the timing of additional capital expenditures and the related depreciation expense, or other increases in our infrastructure costs, as well as revenue fluctuations. We generally expect our gross margin to increase in the near term due to the useful lives of certain infrastructure server and component assets increasing from four to five years, and remain relatively constant in the long term.

Current wording

Gross margin. Gross margin is gross profit expressed as a percentage of revenue. Our gross margin may fluctuate from period to period based on the timing of additional capital expenditures and the related depreciation expense, or other increases in our infrastructure costs, as well as revenue fluctuations. We expect gross margin to decrease slightly in the near term as we lap the benefit of our extension of useful lives of certain infrastructure server and component assets as described above, and remain relatively constant in the long term.

Previous wording

We expect that research and development costs will decrease in absolute dollars and as a percentage of revenue in the near term and fluctuate in absolute dollars and decrease as a percentage of revenue in the long term, and we plan to continue to hire employees for our engineering, product, and design teams in roles critical to our future growth initiatives.

Current wording

We expect that research and development costs will decrease in absolute dollars and as a percentage of revenue in both the near term and long term as a result of our 2024 reduction in workforce, partially offset by continued hiring for our engineering, product, and design teams in roles critical to our future growth initiatives.

Previous wording

We expect that sales and marketing expenses will fluctuate in absolute dollars and as a percentage of revenue in both the near term and long term. We plan to continue investing in sales and marketing in the long term, in order to grow our user base and increase our brand awareness. The trend and timing of sales and marketing expenses will depend in part on the timing of marketing campaigns.

Current wording

We expect that sales and marketing expenses will decrease in absolute dollars and as a percentage of revenue in both the near term and long term as a result of our 2024 reduction in workforce, partially offset by continued investment in sales and marketing in the long term, in order to grow our user base and increase our brand awareness. The trend and timing of sales and marketing expenses will depend in part on the timing of marketing campaigns.

Previous wording

(2)Includes expenses related to our reduction in workforce such as severance, benefits and other related items during the three and six months ended June 30, 2023.

Current wording

(2)Includes expenses related to our 2023 reduction in workforce such as severance, benefits and other related items during the three and nine months ended September 30, 2023.

Previous wording

(2)Includes expenses related to our reduction in workforce such as severance, benefits and other related items during the three and six months ended June 30, 2023.

Current wording

(2)Includes expenses related to our 2023 reduction in workforce such as severance, benefits and other related items during the three and nine months ended September 30, 2023.

Previous wording

Revenue increased $12.0 million or 1.9% during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023 primarily due to an increase in paying usersand an increased mix of sales towards our higher priced plans, as well as a shift to monthly subscription plans, which have a higher price point than our annual plans, which together contributed to an increase of $11.1 million in revenue. In addition, revenue was positively impacted by $0.9 million from changes in foreign exchange rates across multiple currencies.

Current wording

Revenue increased $5.8 million or 0.9% during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023 primarily due to an increase in paying usersand an increased mix of sales towards our higher priced plans, as well as a shift to monthly subscription plans, which have a higher price point than our annual plans, which together contributed to an increase of $5.9 million in revenue. In addition, revenue was negatively impacted by $0.1 million from changes in foreign exchange rates across multiple currencies.

Previous wording

Cost of revenue decreased $13.1 million or 10.9% during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, primarily due to decreases of $8.2 million in infrastructure costs, primarily as a result of the change in useful lives from 4 to 5 years for certain infrastructure and component assets, and $3.4 million in employee-related costs.

Current wording

Cost of revenue decreased $8.1 million or 6.8% during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023, primarily due to decreases of $7.1 million in infrastructure costs, primarily as a result of the change in useful lives from 4 to 5 years for certain infrastructure and component assets, and $1.5 million in outside services.

Previous wording

Our gross margin increased during the three months ended June 30, 2024 compared to the three months ended June 30, 2023, primarily due to a 1.9% increase in revenue during the period and a 10.9% decrease in our cost of revenue as described above.

Current wording

Our gross margin increased during the three months ended September 30, 2024 compared to the three months ended September 30, 2023, primarily due to a 0.9% increase in revenue during the period and a 6.8% decrease in our cost of revenue as described above.

Previous wording

Sales and marketing expenses decreased $18.8 million or 7.8% during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to a decrease of $21.8 million in employee-related costs. This decrease was partially offset by an increase of $1.7 million related to advertising and other marketing related expenses.

Current wording

Sales and marketing expenses increased $4.2 million or 4.0% during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023, primarily due to an increase of $4.1 million related to advertising and other marketing related expenses.

Previous wording

Net loss on real estate assets was $2.2 million during the six months ended June 30, 2023 related to right-of-use and other lease related property and equipment assets, in conjunction with our Virtual First model. There were no similar charges during the six months ended June 30, 2024.

Current wording

The Company did not record any gain or losses on real estate assets during the three months ended September 30, 2024 and 2023, related to right-of-use and other lease related property and equipment assets, in conjunction with our Virtual First model.

Previous wording

Interest income, net increased by $1.0 million during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, primarily due to higher interest income as a result of interest rate increases.

Current wording

Interest income, net decreased by $1.2 million during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023, primarily due to higher interest expense for our finance leases as a result of interest rate increases.

Previous wording

Other income (loss), net increased by $3.8 million during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to a $2.3 million reduction in losses on investments, a $1.4 million gain from sales of retired infrastructure assets, and a $0.3 million increase in foreign currency transaction gains.

Current wording

Other income (loss), net increased by $1.3 million during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023, primarily due to a $0.4 million gain from sales of retired infrastructure assets, and a $0.3 million increase in foreign currency transaction gains.

Previous wording

Revenue increased $32.2 million or 2.6% during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to an increase of $30.9 million primarily due to an increase in paying usersand an increased mix of sales towards our higher priced plans, as well as a shift to monthly subscription plans, which have a higher price point than our annual plans. Revenue was positively impacted by $1.5 million from changes in foreign exchange rates across multiple currencies.

Current wording

Revenue increased $38.0 million or 2.0% during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to an increase of $36.6 million due to an increase in paying usersand an increased mix of sales towards our higher priced plans, as well as a shift to monthly subscription plans, which have a higher price point than our annual plans. Revenue was positively impacted by $1.4 million from changes in foreign exchange rates across multiple currencies.

Previous wording

Cost of revenue decreased $24.1 million or 10.2% during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to decreases of $17.3 million in infrastructure costs, primarily as a result of the change in useful lives from 4 to 5 years for certain infrastructure and component assets, and $4.6 million in employee-related costs.

Current wording

Cost of revenue decreased $32.2 million or 9.0% during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to decreases of $24.5 million in infrastructure costs, primarily as a result of the change in useful lives from 4 to 5 years for certain infrastructure and component assets, $4.0 million in employee-related costs, and $3.6 million in outside services.

Previous wording

Our gross margin increased during the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to a 2.6% increase in revenue during the period and a 10.2% decrease in our cost of revenue as described above.

Current wording

Our gross margin increased during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, primarily due to a 2.0% increase in revenue during the period and a 9.0% decrease in our cost of revenue as described above.

Previous wording

Research and development expenses decreased $35.7 million or 13.6% during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, primarily due to decreases of $36.3 million in employee-related costs and $1.7 million in allocated overhead.

Current wording

Research and development expenses decreased $42.5 million or 5.9% during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to decreases of $34.3 million in employee-related costs and $7.7 million in allocated overhead.

Previous wording

Sales and marketing expenses decreased $8.4 million or 6.9% during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, primarily due to a decrease of $16.4 million in employee-related costs. This decrease was partially offset by an increase of $6.1 million related to advertising and other marketing related expenses.

Current wording

Sales and marketing expenses decreased $14.6 million or 4.2% during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to a decrease of $22.2 million in employee-related costs. This decrease was partially offset by an increase of $5.8 million related to advertising and other marketing related expenses.

Previous wording

General and administrative expenses increased $0.9 million or 1.5% during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, primarily due to an increase of $4.5 million in non-income based taxes. This increase was partially offset by decreases of $2.0 million in employee-related costs and $1.9 million in outside services.

Current wording

General and administrative expenses increased $2.5 million or 1.4% during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to increases of $1.9 million in outside services and $2.8 million in non-income based taxes. These increases were partially offset by a decrease of $2.1 million in employee-related cost.

Previous wording

Net loss on real estate assets was $2.2 million during the three months ended June 30, 2023 related to right-of-use and other lease related property and equipment assets, in conjunction with our Virtual First model. There were no similar charges during the three months ended June 30, 2024.

Current wording

Net loss on real estate assets was $2.2 million during the nine months ended September 30, 2023 related to right-of-use and other lease related property and equipment assets, in conjunction with our Virtual First model. There were no similar charges during the nine months ended September 30, 2024.

Previous wording

Interest income, net increased by $4.4 million during the six months ended June 30, 2024, as compared to the six months ended June 30, 2023, primarily due to higher interest income as a result of interest rate increases.

Current wording

Interest income, net increased by $3.2 million during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to increased investments in money market funds offset by higher interest expense for our finance leases as a result of interest rate increases.

Previous wording

Other income (loss), net increased by $3.1 million during the three months ended June 30, 2024, as compared to the three months ended June 30, 2023, primarily due to a $1.5 million gain from sales of retired infrastructure assets, a $1.1 million increase in foreign currency transaction gains, and a $0.7 million reduction in losses on investments.

Current wording

Other income (loss), net increased by $5.1 million during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, primarily due to a $2.4 million reduction in losses on investments, a $1.8 million gain from sales of retired infrastructure assets, and a $0.6 million increase in foreign currency transaction gains.

Previous wording

Provision for income taxes increased $7.5 million during thesix months ended June 30, 2024, as compared to thesix months ended June 30, 2023, primarily due to the impact of our reduction in workforce on prior year income before income taxes, partially offset by an increase in availability of tax credits in the current year.

Current wording

Provision for income taxes increased $12.1 million during thenine months ended September 30, 2024, as compared to thenine months ended September 30, 2023, primarily due to the impact of our 2023 reduction in workforce on prior year income before income taxes.

Previous wording

As of June 30, 2024, we had cash and cash equivalents of $515.1 million and short-term investments of $547.4 million, which were held for working capital purposes. Our cash, cash equivalents, and short-term investments consist primarily of cash, money market funds, corporate notes and obligations, U.S. Treasury securities, certificates of deposit, asset-backed securities, commercial paper, foreign government securities, U.S. agency obligations, supranational securities, and municipal securities. As of June 30, 2024, $319.2 million of our cash and cash equivalents was held by our foreign subsidiaries. We do not expect to incur material taxes in the event we repatriate any of these amounts. Our cash is held at several large financial institutions and our investments are focused on the preservation of capital, fulfillment of our liquidity needs, and maximization of investment performance within the parameters set forth in our investment policy and subject to market conditions. The investment policy sets forth credit rating minimums, permissible allocations, and limits our exposure to specific investment types. We believe these policies mitigate our exposure to risk concentrations.

Current wording

As of September 30, 2024, we had cash and cash equivalents of $517.6 million and short-term investments of $373.2 million, which were held for working capital purposes. Our cash, cash equivalents, and short-term investments consist primarily of cash, money market funds, corporate notes and obligations, U.S. Treasury securities, certificates of deposit, asset-backed securities, commercial paper, foreign government securities, U.S. agency obligations, supranational securities, and municipal securities. As of September 30, 2024, $387.1 million of our cash and cash equivalents was held by our foreign subsidiaries. We do not expect to incur material taxes in the event we repatriate any of these amounts. Our cash is held at several large financial institutions and our investments are focused on the preservation of capital, fulfillment of our liquidity needs, and maximization of investment performance within the parameters set forth in our investment policy and subject to market conditions. The investment policy sets forth credit rating minimums, permissible allocations, and limits our exposure to specific investment types. We believe these policies mitigate our exposure to risk concentrations.

Previous wording

Our principal uses of cash in recent periods have been funding our operations, repurchases of our Class A common stock, purchases of short-term investments, the satisfaction of tax withholding obligations in connection with the settlement of restricted stock units and awards, making principal payments on our finance lease obligations, and capital expenditures. In February 2022, our Board of Directors authorized the repurchase of up to $1.2 billion of the outstanding shares of our Class A common stock. In July 2023, our Board of Directors authorized the repurchase of up to an additional $1.2 billion of the outstanding shares of our Class A common stock. We completed the February 2022 authorization of $1.2 billion during the three months ended March 31, 2024 and continued stock repurchases under the July 2023 authorization. Share repurchases will be made from time-to-time in private transactions or open market purchases as permitted by securities laws and other legal requirements and will be subject to a review of the circumstances in place at that time, including prevailing market prices. The program does not obligate us to repurchase any specific number of shares and has no specified time limit; it may be discontinued at any time. During the three and six months ended June 30, 2024, we repurchased and subsequently retired 11.3 million and 22.4 million shares, respectively, of our Class A common stock for an aggregate amount of $262.2 million and $543.8 million, respectively. Included in the cost of treasury stock acquired pursuant to common share repurchases is the 1% excise tax imposed as part of the Inflation Reduction Act. The pace of our share repurchases may fluctuate due to various circumstances, including market conditions and our stock price.

Current wording

Our principal uses of cash in recent periods have been funding our operations, repurchases of our Class A common stock, purchases of short-term investments, the satisfaction of tax withholding obligations in connection with the settlement of restricted stock units and awards, making principal payments on our finance lease obligations, and capital expenditures. In February 2022, our Board of Directors authorized the repurchase of up to $1.2 billion of the outstanding shares of our Class A common stock. In July 2023, our Board of Directors authorized the repurchase of up to an additional $1.2 billion of the outstanding shares of our Class A common stock. We completed the February 2022 authorization of $1.2 billion during the three months ended March 31, 2024 and have continued stock repurchases under the July 2023 authorization. Share repurchases are made from time-to-time in private transactions or open market purchases as permitted by securities laws and other legal requirements and are subject to a review of the circumstances in place at that time, including prevailing market prices. The program does not obligate us to repurchase any specific number of shares and has no specified time limit; it may be discontinued at any time. During the three and nine months ended September 30, 2024, we repurchased and subsequently retired 14.6 million and 37.0 million shares, respectively, of our Class A common stock for an aggregate amount of $351.8 million and $895.6 million, respectively. The 1% excise tax imposed as part of the Inflation Reduction Act is included in the cost of treasury stock acquired pursuant to common share repurchases. The pace of our share repurchases may fluctuate due to various circumstances, including market conditions and our stock price.

Previous wording

As of June 30, 2024, we had no amounts outstanding under the revolving credit facility and an aggregate of $30.4 million in letters of credit issued under the revolving credit facility. Our total available borrowing capacity under the revolving credit facility was $469.6 million as of June 30, 2024.

Current wording

As of September 30, 2024, we had no amounts outstanding under the revolving credit facility and an aggregate of $30.5 million in letters of credit issued under the revolving credit facility. Our total available borrowing capacity under the revolving credit facility was $469.5 million as of September 30, 2024.

Previous wording

Our future capital requirements will depend on many factors including our revenue growth rate, subscription renewal activity, billing frequency, the timing and extent of spending to support further infrastructure development and research and development efforts, the timing and extent of additional capital expenditures to invest in collaboration spaces, our ability to sublease space at office locations where we have unused spaces, the satisfaction of tax withholding obligations for the release of restricted stock units and awards, the expansion of sales and marketing and international operation activities, the introduction of new product capabilities and enhancement of our platform, the continuing market acceptance of our platform, and the volume and timing of our share repurchases. We have and may in the future enter into arrangements to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, results of operations, and financial condition could be materially and adversely affected.

Current wording

Our future capital requirements will depend on many factors including our revenue growth rate, subscription renewal activity, billing frequency, the timing and extent of spending to support further infrastructure development and research and development efforts, the timing and extent of additional capital expenditures to invest in infrastructure equipment to support our user base, our ability to sublease space at office locations where we have unused spaces, the satisfaction of tax withholding obligations for the release of restricted stock units and awards, the expansion of sales and marketing and international operation activities, the introduction of new product capabilities and enhancement of our platform, the continuing market acceptance of our platform, and the volume, timing, and amount of our share repurchases. In addition, we have and may in the future enter into arrangements to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights. In light of all of these circumstances, we may be required to seek additional equity or debt financing, or we may decide to do so opportunistically. In the event that additional financing is required or desired from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, results of operations, and financial condition could be materially and adversely affected.

Previous wording

For the six months ended June 30, 2024, net cash provided by operating activities was $406.1 million, which primarily consisted of our net income of $242.8 million, adjusted for stock-based compensation expense of $168.5 million, depreciation and amortization expenses of $63.8 million, and net cash outflow of $104.7 million from operating assets and liabilities. The outflow from operating assets and liabilities was primarily due to the payment of our corporate bonus and the payment for the second tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters, offset by an increase in deferred revenue from increased subscription sales, as a majority of our paying users are invoiced in advance.

Current wording

For the nine months ended September 30, 2024, net cash provided by operating activities was $680.3 million, which primarily consisted of our net income of $349.5 million, adjusted for stock-based compensation expense of $260.8 million, depreciation and amortization expenses of $99.1 million, and net cash outflow of $80.0 million from operating assets and liabilities. The outflow from operating assets and liabilities was primarily due to the payment of our corporate bonus and the payment for the second tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters, offset by an increase in deferred revenue from increased subscription sales, as a majority of our paying users are invoiced in advance.