CrowdStrike Holdings, Inc.
For the period ended Jan 31, 2026. Filed Mar 5, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Mar 5, 2026
CRWD$216.90-0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-01-31; filed 2025-03-10.
0001535527-25-000009
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-01-31; filed 2026-03-05.
0001535527-26-000010
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 122 previous paragraphs and 130 current paragraphs.
86 unchanged; 35 reworded; 9 added; 1 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 16 previous and 24 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (9)
Current report
Sales and marketing expenses increased by $308.3 million, or 20%, in fiscal 2026, as compared to fiscal 2025. The increase in sales and marketing expenses was primarily due to an increase in employee-related expenses of $168.4 million driven by a 12% increase in average headcount, an increase in stock-based compensation expense of $48.2 million, an increase in marketing programs of $29.2 million, an increase in allocated overhead costs of $20.2 million, an increase in employee benefits of $16.5 million, an increase in travel expenses of $11.2 million, charges related to the Strategic Plan of $9.0 million, an increase in cloud hosting and related costs of $6.2 million, an increase in term-based software licenses of $3.2 million, an increase in other labor expenses of $2.1 million, and an increase in consulting expenses of $1.7 million, partially offset by a decrease in expenses associated with the July 19 Incident and related matters of $20.3 million.
Current report
On January 7, 2026, we entered into a definitive agreement to acquire 100% of the equity interest of SGNL.AI, Inc., a leader in continuous identity. The acquisition closed on February 20, 2026. The total consideration transferred consisted of $627.9 million in cash, net of $9.4 million of cash acquired, and $8.9 million representing the fair value of replacement equity awards attributable to pre-acquisition service, subject to customary net working capital and purchase price adjustments. The cash consideration included cash held back in an escrow fund for a partial security for post-closing indemnification claims. We are currently finalizing the intangible assets valuation and purchase price allocation.
Current report
On January 12, 2026, we entered into a definitive agreement to acquire 100%of the equity interest of Seraphic Algorithms Ltd. (“Seraphic”), a leader in browser runtime security. The acquisition closed on February 3, 2026. The total consideration transferred consisted of $327.4 million in cash, net of $1.1 million of cash and restricted cash acquired, and $13.9 million representing the fair value of replacement equity awards attributable to pre-acquisition service, subject to customary net working capital and purchase price adjustments.
Current report
Change in Accounting Estimate
Current report
In February 2026, we completed an assessment of the estimated period of benefit of commissions earned upon the initial acquisition of a contract, or subsequent upsell, and determined that it should increase from four to five years. This change in estimate will be effective beginning in fiscal year 2027. It is estimated this change will improve our fiscal year 2027 income (loss) from operations by $85.0 million to $95.0 million.
Current report
Quarterly Financial Information
Current report
As discussed in Note 1 and Note 16 of the Notes to the Consolidated Financial Statements, we identified an immaterial error related to the recognition of stock-based compensation expense in prior periods. We will revise our previously reported quarterly financial information based on the summary presented below in our future filings with the SEC, as applicable, to correct for this error.
Current report
A summary of the impacts of the revision to the affected financial statement line items in our Condensed Consolidated Financial Statements is presented below for each quarterly period in the fiscal year ended January 31, 2026 (in thousands, except per share data). As the impact of the error for the fiscal year ended January 31, 2025 was only $4.0 million, the impacts of the revision on the associated quarterly periods have not been presented as they are not individually material to any quarterly period.
Current report
There was no impact to the consolidated statements of cash flows from operating activities, investing activities, or financing activities for any period. The impact to the consolidated statements of comprehensive income (loss) is limited to the impact to Net income (loss) as detailed above. The impact to the consolidated statements of stockholders' equity is to Additional paid-in capital and Accumulated deficit for the same amounts as detailed above, with no resulting impact on Total stockholders’ equity as previously reported.
Removed paragraphs (1)
Previous report
Sales and marketing expenses increased by $382.8 million, or 34%, in fiscal 2025, compared to fiscal 2024. The increase in sales and marketing expenses was primarily due to an increase in employee-related expenses of $159.0 million driven by a 14% increase in average headcount, an increase in stock-based compensation expense of $59.7 million, an increase in marketing programs of $55.5 million, an increase in allocated overhead costs of $28.4 million, $21.4 million of expenses relating to the July 19 Incident, an increase in travel expenses of $13.1 million, an increase in company events expenses of $8.6 million, an increase in employee benefits of $6.3 million, an increase in term-based software licenses of $5.4 million, an increase in cloud hosting and related costs of $4.2 million, an increase in other labor expenses of $2.8 million, and an increase in consulting expense of $2.5 million.
Reworded paragraphs (35)
Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes thereto included in Item 8 “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K. This section of this Form 10-K generally discusses fiscal 2025 and 2024 items and year-over-year comparisons between fiscal 2025 and 2024. Discussions of fiscal 2023 items and year-over-year comparisons between fiscal 2024 and 2023 are not included in this Form 10-K, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended January 31, 2024. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties, including those described under the heading “Special Note Regarding Forward-Looking Statements.” You should review the disclosure under Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Our fiscal years ended January 31, 2025, January 31, 2024, and January 31, 2023, are referred to herein as fiscal 2025, fiscal 2024, and fiscal 2023, respectively.
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes thereto included in Item 8 “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K. This section of this Form 10-K generally discusses fiscal 2026 and 2025 items and year-over-year comparisons between fiscal 2026 and 2025. Discussions of fiscal 2024 items and year-over-year comparisons between fiscal 2025 and 2024 are not included in this Form 10-K, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended January 31, 2025. As discussed in Note 1 and Note 16 to the Consolidated Financial Statements included in this report, the Company revised its fiscal 2025 and 2024 financial results to correct for an immaterial error discovered during the fourth quarter of fiscal 2026. The revisions are intended to ensure comparability across all periods reflected herein. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties, including those described under the heading “Special Note Regarding Forward-Looking Statements.” You should review the disclosure under Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Our fiscal years ended January 31, 2026, January 31, 2025, and January 31, 2024, are referred to herein as fiscal 2026, fiscal 2025, and fiscal 2024, respectively.
Previous wording
Founded in 2011, CrowdStrike reinvented cybersecurity for the cloud era and transformed the way cybersecurity is delivered and experienced by customers. When we started CrowdStrike, cyberattackers had an asymmetric advantage over legacy cybersecurity products that could not keep pace with the rapid changes in adversary tactics. We took a fundamentally different approach to solve this problem with the AI-native CrowdStrike Falcon platform – the first, true cloud-native unified platform built with AI at the core, capable of harnessing vast amounts of security and enterprise data to deliver highly modular solutions through a single lightweight agent.
Current wording
Founded in 2011, we reinvented cybersecurity for the cloud era and transformed the way cybersecurity is delivered and experienced by customers. When we started CrowdStrike, cyberattackers had an asymmetric advantage over legacy cybersecurity products that could not keep pace with the rapid changes in adversary tactics. We took a fundamentally different approach to solve this problem with the AI-native CrowdStrike Falcon platform – the first, true cloud-native unified platform built with artificial intelligence (“AI”) at the core, capable of harnessing vast amounts of security and enterprise data to deliver highly modular solutions through a single lightweight sensor.
Previous wording
Invest in Growth. We believe that our market opportunity is large and requires us to continue to invest significantly in sales and marketing efforts to further grow our customer base, both domestically and internationally. Our open cloud architecture and single data model have allowed us to rapidly build and deploy new cloud modules, and we expect to continue investing in those efforts to further enhance our technology platform and product functionality. In addition to our ongoing investment in research and development, we may also pursue acquisitions of businesses, technologies, and assets that complement and expand the functionality of our Falcon platform, add to our technology or security expertise, or bolster our leadership position by gaining access to new customers or markets. Furthermore, we expect our general and administrative expenses to increase in dollar amount for the foreseeable future given the additional expenses for accounting, compliance, and investor relations as we grow as a public company.
Current wording
Invest in Growth. We believe that our market opportunity is large and requires us to continue to invest significantly in sales and marketing efforts to further grow our customer base, both domestically and internationally. Our open cloud architecture and single data model have allowed us to rapidly build and deploy new cloud modules, and we expect to continue investing in those efforts to further enhance our technology platform and product functionality. In addition to our ongoing investment in research and development, we may also pursue acquisitions of businesses, technologies, and assets that complement and expand the functionality of our Falcon platform, add to our technology or security expertise, or bolster our leadership position by gaining access to new customers or markets. Furthermore, we expect our general and administrative expenses to increase in dollar amount for the foreseeable future given the additional expenses for accounting, compliance, and investor relations as we grow.
Previous wording
July 19 Incident. On July 19, 2024, we released a content configuration update for our Falcon sensor that resulted in system crashes for certain Windows systems (the “July 19 Incident”). As a result of the July 19 Incident, we are subject to lawsuits, claims and inquiries as described in Note 10, Commitments and Contingencies, in Part II, Item 8 of this Annual Report on Form 10-K. We have incurred, and expect to continue to incur, significant legal and professional services and other general and administrative expenses associated with the July 19 Incident in future periods. It is not reasonably possible to quantify the precise impact of the July 19 Incident, but the incident has adversely affected our results of operations, and we currently expect a number of factors relating to the incident to adversely affect our key metrics and results of operations in future periods. While we have maintained high dollar-based gross retention rates following the incident, we have experienced delays in creating sales opportunities and longer sales cycles, including delays in customer purchasing decisions. We expect sales cycles to continue to be elongated in future periods. In addition, because our customers typically sign contracts with terms of twelve months or longer, customer churn and any corresponding impact to our key metrics and revenue may occur in future periods. Customer commitment packages introduced following the July 19 Incident have included discounting, additional modules, professional services, flexible payment terms or subscription period extensions. Our customer commitment packages have resulted, and are expected to continue to result, in increased contraction, due to elongated subscription terms, and decreased upsell dollar values.
Current wording
July 19 Incident. On July 19, 2024, we released a content configuration update for our Falcon sensor that resulted in system crashes for certain Windows systems (the “July 19 Incident”). As a result of the July 19 Incident, we are subject to lawsuits, claims and inquiries as described in Note 10, Commitments and Contingencies, in Part II, Item 8 of this Annual Report on Form 10-K. We have incurred, and expect to continue to incur, significant legal and professional services and other general and administrative expenses associated with the July 19 Incident in future periods. It is not reasonably possible to quantify the precise impact of the July 19 Incident, but the incident has adversely affected our results of operations, and we currently expect a number of factors relating to the incident to adversely affect our key metrics and results of operations in future periods. While we have maintained high dollar-based gross retention rates following the incident, we have experienced delays in creating sales opportunities and longer sales cycles, including delays in customer purchasing decisions. Sales cycles may be elongated in future periods. In addition, because our customers typically sign contracts with terms over one year, customer churn and any corresponding impact to our key metrics and revenue may occur in future periods. Customer commitment packages introduced following the July 19 Incident have included discounting, additional modules, professional services, flexible payment terms or subscription period extensions. Our customer commitment packages have resulted, and are expected to continue to result, in increased contraction, due to elongated subscription terms, and decreased upsell dollar values.
Previous wording
ARR increased 23% year-over-year and grew to $4.2 billion as of January 31, 2025, of which $806.7 million was net new ARR added during fiscal 2025. ARR increased 34% year-over-year and grew to $3.4 billion as of January 31, 2024, of which $875.5 million was net new ARR added during fiscal 2024.
Current wording
ARR increased 24% year-over-year and grew to $5.3 billion as of January 31, 2026, of which $1.0 billion was net new ARR added during fiscal 2026. ARR increased 23% year-over-year and grew to $4.2 billion as of January 31, 2025, of which $806.7 million was net new ARR added during fiscal 2025.
Previous wording
We expect general and administrative expenses to increase in dollar amount over time. We expect to incur significant legal and professional services and other expenses associated with the July 19 Incident in future periods. General and administrative expenses may fluctuate as a percentage of our total revenue from period to period depending on the timing of these expenses.
Current wording
We expect general and administrative expenses to increase in dollar amount over time. We expect to incur significant legal and professional services and other expenses associated with the July 19 Incident and related matters in future periods. General and administrative expenses may fluctuate as a percentage of our total revenue from period to period depending on the timing of these expenses.
Previous wording
Interest Expense. Interest expense consists primarily of amortization of debt issuance costs, contractual interest expense for our Senior Notes issued in January 2021, and amortization of debt issuance costs on our secured revolving credit facility (“Revolving Facility”).
Current wording
Interest Expense. Interest expense consists primarily of amortization of debt issuance costs, contractual interest expense for our Senior Notes issued in January 2021, and amortization of debt issuance costs on our revolving facility, which expired in January 2026.
Previous wording
Interest Income. Interest income consists primarily of income earned on our cash, cash equivalents, and short-term investments.
Current wording
Interest Income. Interest income consists primarily of income earned on our cash and cash equivalents.
Previous wording
Other Income, Net. Other income, net consists primarily of gains and losses on strategic investments and foreign currency transaction gains and losses.
Current wording
Other Income (Expense), Net. Other income (expense), net consists primarily of gains and losses on strategic investments and foreign currency transaction gains and losses.
Previous wording
Total revenue increased by $898.1 million, or 29%, in fiscal 2025, compared to fiscal 2024. Subscription revenue accounted for 95% and 94% of our total revenue in fiscal 2025 and fiscal 2024, respectively. Professional services revenue accounted for 5% and 6% of our total revenue in fiscal 2025 and fiscal 2024, respectively.
Current wording
Total revenue increased by $858.4 million, or 22%, in fiscal 2026, as compared to fiscal 2025. Subscription revenue accounted for 95% of total revenue for each of fiscal 2026 and fiscal 2025. Professional services revenue accounted for 5% of total revenue for each of fiscal 2026 and fiscal 2025.
Previous wording
Subscription revenue increased by $890.9 million, or 31% in fiscal 2025, compared to fiscal 2024, which was primarily driven by a combination of the addition of new customers and the sale of additional sensors and modules to existing customers.
Current wording
Subscription revenue increased by $803.2 million, or 21% in fiscal 2026, as compared to fiscal 2025, which was primarily driven by a combination of the addition of new customers and the sale of additional sensors and modules to existing customers.
Previous wording
Professional services revenue increased by $7.1 million, or 4%, in fiscal 2025, compared to fiscal 2024, which was primarily attributable to an increase in the number of professional service hours.
Current wording
Professional services revenue increased by $55.2 million, or 29%, in fiscal 2026, as compared to fiscal 2025, which was primarily attributable to an increase in the number of professional service hours.
Previous wording
Total cost of revenue increased by $235.8 million, or 31%, in fiscal 2025, compared to fiscal 2024. Subscription cost of revenue increased by $204.8 million, or 32%, in fiscal 2025, compared to fiscal 2024. The increase in subscription cost of revenue was primarily due to an increase in employee-related expenses of $55.6 million driven by a 28% increase in average headcount, an increase in depreciation of data center equipment of $38.4 million, an increase in stock-based compensation expense of $29.7 million, an increase in cloud hosting and related services costs of $28.5 million, an increase in allocated overhead costs of $20.3 million, an increase in amortization of internal-use software of $17.6 million, an increase in hardware maintenance costs of $5.4 million, and an increase in employee benefits of $4.2 million.
Current wording
Total cost of revenue increased by $228.8 million, or 23%, in fiscal 2026, as compared to fiscal 2025. Subscription cost of revenue increased by $181.3 million, or 22%, in fiscal 2026, as compared to fiscal 2025. The increase in subscription cost of revenue was primarily due to an increase in cloud hosting and related services costs of $46.4 million, an increase in employee-related expenses of $43.1 million driven by a 16% increase in average headcount, an increase in depreciation of data center equipment of $33.4 million, an increase in amortization of internal-use software of $24.9 million, an increase in stock-based compensation expense of $18.1 million, an increase in allocated overhead costs of $16.8 million, and charges related to the Strategic Plan of $3.4 million, partially offset by a decrease in other labor expenses of $2.8 million and a decrease in company events expenses of $1.2 million.
Previous wording
Professional services cost of revenue increased by $31.0 million, or 25%, in fiscal 2025, compared to fiscal 2024. The increase in professional services cost of revenue was primarily due to an increase in employee-related expenses of $13.1 million driven by an 20% increase in average headcount, an increase in stock-based compensation expense of $8.8 million, an increase in allocated overhead costs of $5.0 million, an increase in consulting expense of $2.2 million, and an increase in employee benefits of $1.0 million.
Current wording
Professional services cost of revenue increased by $47.4 million, or 30%, in fiscal 2026, as compared to fiscal 2025. The increase in professional services cost of revenue was primarily due to an increase in consulting expenses of $18.7 million, an increase in employee-related expenses of $15.5 million driven by a 12% increase in average headcount, an increase in stock-based compensation expense of $5.7 million, charges related to the Strategic Plan of $3.3 million, and an increase in allocated overhead costs of $2.6 million.
Previous wording
Subscription gross margin was flat in fiscal 2025, compared to fiscal 2024.
Current wording
Subscription gross margin was flatin fiscal 2026, as compared to fiscal 2025.
Previous wording
Professional services gross margin decreased by 13% in fiscal 2025, compared to fiscal 2024. The decrease in professional services gross margin was primarily due to an increase in consulting expense and decreased utilization during fiscal 2025 compared to fiscal 2024.
Current wording
Professional services gross margin decreased by 1% in fiscal 2026, as compared to fiscal 2025. The decrease in professional services gross margin was primarily due to an increase in consulting expense and an increase in stock-based compensation expense during fiscal 2026, as compared to fiscal 2025.
Previous wording
Research and development expenses increased by $308.4 million, or 40% in fiscal 2025, compared to fiscal 2024. This increase was primarily due to an increase in stock-based compensation expense of $131.7 million, an increase in employee-related expenses of $119.3 million driven by a 18% increase in average headcount, an increase in cloud hosting and related costs of $64.2 million, $6.8 million of expenses relating to the July 19 Incident, an increase in term-based software licenses of $6.4 million, an increase in employee benefits of $5.1 million, an increase in travel expenses of $3.2 million, and an increase in consulting expense of $1.7 million, partially offset by a decrease in allocated engineering and overhead costs of $27.5 million, an increase in software capitalization of $11.4 million, and a decrease in other labor expenses of $9.7 million.
Current wording
Research and development expenses increased by $309.2 million, or 29% in fiscal 2026, as compared to fiscal 2025. This increase was primarily due to an increase in employee-related expenses of $116.8 million driven by a 20% increase in average headcount, an increase in stock-based compensation expense of $94.0 million, an increase in cloud hosting and related costs of $46.4 million, an increase in allocated overhead costs of $27.6 million, charges related to the Strategic Plan of $16.6 million, and an increase in term-based software licenses of $3.5 million, partially offset by an increase in software capitalization of $9.8 million, and a decrease in expenses associated with the July 19 Incident and related matters of $4.4 million.
Previous wording
General and administrative expenses increased by $89.6 million, or 23%, in fiscal 2025, compared to fiscal 2024. The increase in general and administrative expenses was primarily due to $31.9 million of expenses relating to the July 19 Incident, an increase in employee-related expenses of $27.2 million driven by a 19% increase in average headcount, an increase in allocated overhead costs of $6.3 million, an increase in consulting expense of $5.0 million, an increase in leased airfare costs of $4.5 million, an increase in stock-based compensation expense of $4.0 million, an increase in travel expenses of $2.3 million, an increase in company events expenses of $2.1 million, an increase in term-based software licenses of $2.1 million, an increase in taxes and licenses expenses of $2.0 million, an increase in employee related programs of $1.8 million, and an increase in other labor expenses of $1.7 million, partially offset by a decrease in legal expense of $7.5 million unrelated to the July 19 Incident.
Current wording
General and administrative expenses increased by $189.1 million, or 39%, in fiscal 2026, as compared to fiscal 2025. The increase in general and administrative expenses was primarily due to an increase in expenses associated with the July 19 Incident and related matters of $82.4 million, an increase in stock-based compensation expense of $52.4 million, an increase in consulting expense of $16.4 million, charges related to the Strategic Plan of $12.5 million, an increase in employee-related expenses of $11.2 million driven by a 14% increase in average headcount, an increase in legal expense of $4.5 million unrelated to the July 19 Incident or related matters, an increase in allocated overhead costs of $4.4 million, and an increase in term-based software licenses of $3.0 million.
Previous wording
Interest Expense, Interest Income and Other Income, Net
Current wording
Interest Expense, Interest Income and Other Income (Expense), Net
Previous wording
The following shows interest expense, interest income, and other income, net, for fiscal 2025, as compared to fiscal 2024 (in thousands, except percentages):
Current wording
The following shows interest expense, interest income, and other income (expense), net, for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):
Previous wording
Interest expense consists primarily of amortization of debt issuance costs, contractual interest expense, accretion of debt discount for our Senior Notes issued in January 2021, and amortization of debt issuance costs on our Revolving Facility.
Current wording
Interest expense consists primarily of amortization of debt issuance costs, contractual interest expense, accretion of debt discount for our Senior Notes issued in January 2021, and amortization of debt issuance costs on our revolving facility, which expired in January 2026.
Previous wording
The increase in interest income during fiscal 2025 compared to fiscal 2024 was driven by an increase in our cash and cash equivalents.
Current wording
The decrease in interest income during fiscal 2026 compared to fiscal 2025 was driven by lower market rates, partially offset by higher cash balances.
Previous wording
The increase in other income, net during fiscal 2025 compared to fiscal 2024 was primarily due to an increase in gains on our strategic investments of $2.4 million, a decrease in downward mark to market adjustments of $0.5 million on our strategic investments, and gains on deferred compensation assets of $0.4 million.
Current wording
The decrease in other income (expense), net during fiscal 2026 compared to fiscal 2025 was primarily due to an increase in net foreign currency transaction losses of $3.5 million, a decrease in net realized gains on our strategic investments of $2.2 million, and an increase in downward adjustments and impairment of $0.6 million of our strategic investments, partially offset by an increase in gains from deferred compensation assets of $0.8 million.
Previous wording
The increase in provision for income taxes during fiscal 2025 compared to fiscal 2024 was primarily attributable to intercompany sales of intellectual property from acquired entities, pre-tax foreign earnings, withholding taxes related to customer payments in certain foreign jurisdictions, and change in the realizability of deferred tax assets in certain foreign jurisdictions.
Current wording
The decrease in provision for income taxes during fiscal 2026 compared to fiscal 2025 was primarily attributable to a decrease in tax on intercompany sale of intellectual property from acquired entities, partially offset by an increase in tax on foreign earnings and withholding taxes in certain foreign jurisdictions.
Previous wording
Our primary sources of liquidity as of January 31, 2025, consisted of: (i) $4.3 billion in cash and cash equivalents, which mainly consists of cash on hand and highly liquid investments in money market funds and U.S. Treasury bills, (ii) cash we expect to generate from operations, and (iii) available capacity under our $750.0 million Revolving Facility. It is not currently possible to reasonably estimate the amount of loss or range of possible loss that might result from adverse judgments, settlements, penalties, or other resolution of proceedings resulting from the July 19 Incident. However, despite such uncertainties, we expect that the combination of our existing cash and cash equivalents, cash flows from operations, and the Revolving Facility will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months. Our Revolving Facility matures on January 2, 2026.
Current wording
Our primary sources of liquidity as of January 31, 2026, consisted of: (i) $5.2 billion in cash and cash equivalents, which mainly consists of cash on hand and highly liquid investments in money market funds, U.S. Treasury bills, and time deposits, and (ii) cash we expect to generate from operations. It is not currently possible to reasonably estimate the amount of loss or range of possible loss that might result from adverse judgments, settlements, penalties, or other resolution of proceedings resulting from the July 19 Incident or related matters. However, despite such uncertainties, we expect that the combination of our existing cash and cash equivalents and cash flows from operations will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months.
Previous wording
We have historically generated operating losses prior to fiscal 2024 and during fiscal 2025, as reflected in our accumulated deficit of $1.1 billion as of January 31, 2025. We expect to continue to make investments, particularly in sales and marketing and research and development. As a result, we may require additional capital resources in the future to execute strategic initiatives to grow our business.
Current wording
We have a history of losses, and while we have achieved profitability in certain periods, including fiscal 2024, our accumulated deficit is $1.3 billion as of January 31, 2026. We expect to continue to make investments, particularly in sales and marketing and research and development. As a result, we may require additional capital resources in the future to execute strategic initiatives to grow our business.
Previous wording
We generally invoice our subscription customers at the beginning of the subscription term, or in some instances, such as in multi-year arrangements, in installments. Therefore, a substantial source of our cash is from such prepayments, which are included on our consolidated balance sheets as deferred revenue. Deferred revenue primarily consists of billed fees for our subscriptions, prior to satisfying the criteria for revenue recognition, which are subsequently recognized as revenue in accordance with our revenue recognition policy. As of January 31, 2025, we had deferred revenue of $3.7 billion, of which $2.7 billion was recorded as a current liability and is expected to be recorded as revenue in the next 12 months, provided all other revenue recognition criteria have been met.
Current wording
We generally invoice our subscription customers at the beginning of the subscription term, or in some instances, such as in multi-year arrangements, in installments. Therefore, a substantial source of our cash is from such prepayments, which are included on our consolidated balance sheets as deferred revenue. Deferred revenue primarily consists of billed fees for our subscriptions, prior to satisfying the criteria for revenue recognition, which are subsequently recognized as revenue in accordance with our revenue recognition policy. As of January 31, 2026, we had deferred revenue of $4.8 billion, of which $3.4 billion was recorded as a current liability and is expected to be recorded as revenue in the next 12 months, provided all other revenue recognition criteria have been met.
Previous wording
Net cash provided by operating activities during fiscal 2024 was $1.2 billion, which resulted from net income of $90.6 million, adjusted for non-cash charges of $1.0 billion and net cash inflow of $51.5 million from changes in operating assets and liabilities. Non-cash charges primarily consisted of $631.5 million in stock-based compensation expense, $238.9 million of amortization of deferred contract acquisition costs, $126.8 million of depreciation and amortization, $18.4 million of amortization of intangibles assets, $13.4 million of non-cash operating lease costs, and $3.2 million of non-cash interest expense, partially offset by $3.9 million of realized gains on strategic investments and a $3.4 million change in deferred income taxes. The net cash inflow from changes in operating assets and liabilities was primarily due to a $696.6 million increase in deferred revenue, a $65.1 million increase in accrued payroll and benefits, a $14.6 million increase in accrued expenses and other liabilities, partially offset by a $371.6 million increase in deferred contract acquisition costs, a $217.7 million increase in accounts receivable, net, a $102.5 million increase in prepaid expenses and other assets, a $18.9 million decrease in accounts payable, and a $14.0 million decrease in operating lease liabilities.
Current wording
Net cash provided by operating activities during fiscal 2026 was $1.6 billion, which resulted from net loss of $161.2 million, adjusted for non-cash charges of $1.8 billion and net cash outflow of $59.3 million from changes in operating assets and liabilities. Non-cash charges primarily consisted of $1.1 billion in stock-based compensation expense, $449.4 million of amortization of deferred contract acquisition costs, $250.2 million of depreciation and amortization, $31.2 million of amortization of intangibles assets, $17.2 million of non-cash operating lease costs, $5.4 million of non-cash interest expense, and $1.6 million change in fair value of strategic investments, partially offset by $14.8 million of deferred income taxes and $4.2 million of realized gains on strategic investments. The net cash outflow from changes in operating assets and liabilities was primarily due to an increase of $703.7 million in deferred contract acquisition costs, an increase of $232.5 million in accounts receivable, an increase of $206.2 million in prepaid expenses and other assets, a decrease of $13.7 million in operating lease liabilities, and a decrease of $11.3 million in accounts payable, partially offset by an increase of $1.0 billion in deferred revenue, an increase of $61.6 million in accrued payroll and benefits, and an increase of $22.6 million in accrued expenses and other liabilities.
Previous wording
Net cash provided by operating activities during fiscal 2025 was $1.4 billion, which resulted from net loss of $16.6 million, adjusted for non-cash charges of $1.4 billion and net cash outflow of $6.0 million from changes in operating assets and liabilities. Non-cash charges primarily consisted of $865.4 million in stock-based compensation expense, $318.8 million of amortization of deferred contract acquisition costs, $188.0 million of depreciation and amortization, $26.0 million of amortization of intangibles assets, $15.3 million of non-cash operating lease costs, $3.8 million of non-cash interest expense, and $2.3 million of accretion of short-term investments purchased at a discount, partially offset by $9.9 million of deferred income taxes and $6.3 million of realized gains on strategic investments. The net cash outflow from changes in operating assets and liabilities was primarily due to a $584.5 million increase in deferred contract acquisition costs, a $274.2 million increase in accounts receivable, net, a $190.2 million increase in prepaid expenses and other assets, and a $15.7 million decrease in operating lease liabilities, partially offset by a $669.3 million increase in deferred revenue, a $218.5 million increase in accrued expenses and other liabilities, an $85.9 million increase in accrued payroll and benefits, and an $84.9 million increase in accounts payable.
Current wording
Net cash provided by operating activities during fiscal 2025 was $1.4 billion, which resulted from net loss of $12.6 million, adjusted for non-cash charges of $1.4 billion and net cash outflow of $6.0 million from changes in operating assets and liabilities. Non-cash charges primarily consisted of $861.4 million in stock-based compensation expense, $318.8 million of amortization of deferred contract acquisition costs, $188.0 million of depreciation and amortization, $26.0 million of amortization of intangibles assets, $15.3 million of non-cash operating lease costs, $3.8 million of non-cash interest expense, and $2.3 million of accretion of short-term investments purchased at a discount, partially offset by $9.9 million of deferred income taxes and $6.3 million of realized gains on strategic investments. The net cash outflow from changes in operating assets and liabilities was primarily due to a $584.5 million increase in deferred contract acquisition costs, a $274.2 million increase in accounts receivable, net, a $190.2 million increase in prepaid expenses and other assets, and a $15.7 million decrease in operating lease liabilities, partially offset by a $669.3 million increase in deferred revenue, a $218.5 million increase in accrued expenses and other liabilities, an $85.9 million increase in accrued payroll and benefits, and an $84.9 million increase in accounts payable.
Previous wording
Net cash used in investing activities during fiscal 2024 of $340.7 million was primarily due to business acquisitions, net of cash acquired, of $239.0 million, which was related to the Bionic acquisition, purchases of short-term investments of $195.6 million, purchases of property and equipment of $176.5 million, capitalized internal-use software and website development costs of $49.5 million, purchases of strategic investments of $17.2 million, purchases of intangible assets of $11.1 million, and purchases of deferred compensation investments of $2.0 million, partially offset by proceeds from maturities and sales of short-term investments of $348.3 million, and proceeds from sales of strategic investments of $2.0 million.
Current wording
Net cash used in investing activities during fiscal 2026 of $764.5 million was primarily due to business acquisitions, net of cash acquired, of $382.3 million, which was related to the Onum Technology Inc. and Pangea Cyber Corporation acquisitions, purchases of property and equipment of $302.1 million, capitalized internal-use software and website development costs of $68.8 million, purchases of strategic investments of $10.8 million, and purchases of deferred compensation investments of $6.0 million, partially offset by proceeds from sales of strategic investments of $5.2 million.
Previous wording
Net cash provided by financing activities of $93.2 million during fiscal 2024 was primarily due to proceeds from our employee stock purchase plan of $76.4 million, proceeds from the exercise of stock options of $8.7 million, and capital contributions from non-controlling interests of $8.1 million.
Current wording
Net cash provided by financing activities of $132.5 million during fiscal 2026 was primarily due to proceeds from our employee stock purchase plan of $125.8 million, capital contributions from non-controlling interests of $6.0 million, and proceeds from the exercise of stock options of $3.2 million, partially offset by distributions to non-controlling interest holders of $2.5 million.
Previous wording
We conduct our operations almost entirely through our subsidiaries. Accordingly, the Obligor Group’s cash flows and ability to service the notes will depend on the earnings of our subsidiaries and the distribution of those earnings to the Obligor Group, whether by dividends, loans, or otherwise. Holders of the guaranteed registered debt securities will have a direct claim only against the Obligor Group.
Current wording
We conduct our operations almost entirely through our subsidiaries. Accordingly, the Obligor Group’s cash flows and ability to service the Senior Notes will depend on the earnings of our subsidiaries and the distribution of those earnings to the Obligor Group, whether by dividends, loans, or otherwise. Holders of the guaranteed registered debt securities will have a direct claim only against the Obligor Group.
Previous wording
Our commitments consist of obligations under non-cancellable real estate arrangements on an undiscounted basis, of which $14.1 million is due in the next 12 months and $35.6 million is due thereafter. In addition, we have debt obligations related to $750.0 million aggregate principal amount of the Senior Notes due in fiscal 2030 and the interest payments associated with the Senior Notes of $22.5 million due in the next 12 months and $78.8 million due thereafter. We have non-cancellable purchase commitments with various parties to purchase products and services entered in the normal course of business totaling $2.7 billion as of January 31, 2025, with remaining terms in excess of 12 months. We expect to fund these obligations with cash flows from operations and cash on our balance sheet.
Current wording
Our commitments consist of obligations under non-cancelable real estate arrangements on an undiscounted basis, of which $16.9 million is due in the next 12 months and $65.8 million is due thereafter. In addition, we have debt obligations related to $750.0 million aggregate principal amount of the Senior Notes due in fiscal 2030 and the interest payments associated with the Senior Notes of $22.5 million due in the next 12 months and $56.3 million due thereafter. We have non-cancelable purchase commitments with various parties to purchase products and services entered in the normal course of business totaling $2.8 billion as of January 31, 2026, with remaining terms in excess of 12 months. We expect to fund these obligations with cash flows from operations and cash on our balance sheet.
Previous wording
As of January 31, 2025, our unrecognized tax benefits included $53.1 million, which were classified as long-term liabilities due to the inherent uncertainty with respect to the timing of future cash outflows associated with our unrecognized tax benefits.
Current wording
As of January 31, 2026, our unrecognized tax benefits included $47.3 million, which were classified as long-term liabilities due to the inherent uncertainty with respect to the timing of future cash outflows associated with our unrecognized tax benefits.
Previous wording
As of January 31, 2025, we had non-cancellable unfunded commitments from our financing arrangements totaling approximately $94.2 million.
Current wording
As of January 31, 2026, we had non-cancelable unfunded commitments from our financing arrangements totaling approximately $89.9 million.