Yext Inc

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the fiscal year ended January 31, 2024, filed with the SEC on March 13, 2024. As discussed in the section titled "Special Note Regarding Forward Looking Statements," the following discussion and analysis contains forward looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in the section titled "Risk Factors" under Part II, Item 1A in this Quarterly Report on Form 10-Q.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the fiscal year ended January 31, 2024, filed with the Securities and Exchange Commission ("SEC") on March 13, 2024. As discussed in the section titled "Special Note Regarding Forward Looking Statements," the following discussion and analysis contains forward looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in the section titled "Risk Factors" under Part II, Item 1A in this Quarterly Report on Form 10-Q.

Previous wording

Our results of operations have been and may continue to be influenced by general macroeconomic conditions, including, but not limited to, the impact of foreign currency fluctuations, interest rates, inflation, recession risks and public health emergencies, such as the COVID-19 pandemic. Fluctuations in foreign exchange rates and rising inflation have had, and may continue to have an adverse impact on our financial condition and operating results in future periods. The extent to which such disruptions will continue in future periods remains uncertain, which has had and may continue to have an adverse impact on our financial condition and operating results in future periods. We continue to be committed to our business, the strength of our platform, our ability to continue to execute on our strategy, and our efforts to support our customers.

Current wording

Our results of operations have been and may continue to be influenced by general macroeconomic conditions, including, but not limited to, the impact of foreign currency fluctuations, interest rates, inflation, recession risks, and geopolitical events and shifts. Fluctuations in foreign exchange rates and rising inflation have had, and may continue to have an adverse impact on our financial condition and operating results in future periods. The extent to which such disruptions will continue in future periods remains uncertain, which has had and may continue to have an adverse impact on our financial condition and operating results in future periods. We continue to be committed to our business, the strength of our platform, our ability to continue to execute on our strategy, and our efforts to support our customers.

Previous wording

On June 4, 2024, we committed to a restructuring plan in response to evolving business needs to reduce operating expenses and position Yext for profitable future growth (the “Plan”). The Plan reduced the size of our workforce by approximately 12 percent of our full-time employees as compared to our headcount as of January 31, 2024. We incurred approximately $5 million in costs in connection with the Plan during our second quarter of fiscal year 2025, consisting primarily of severance payments, payments in lieu of notice, employee benefits and related costs. Although the majority of costs were incurred during our second quarter of fiscal year 2025, we may incur additional costs as position eliminations are subject to legal requirements that vary by jurisdiction, which may extend this process beyond the second quarter of fiscal year 2025 in certain cases.

Current wording

On June 4, 2024, we committed to a restructuring plan in response to evolving business needs to reduce operating expenses and position Yext for profitable future growth (the “Plan”). The Plan reduced the size of our workforce by approximately 12 percent of our full-time employees as compared to our headcount as of January 31, 2024. We incurred approximately $5 million in costs in connection with the Plan during our second quarter of fiscal year 2025, consisting primarily of severance payments, payments in lieu of notice, employee benefits and related costs.

Previous wording

Following approval by our Board of Directors, on June 10, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) for the acquisition of Hearsay Social, Inc. (“Hearsay”). Pursuant to the Merger Agreement, Hearsay became a wholly owned subsidiary of Yext upon closing of the transaction on August 1, 2024. We acquired Hearsay for approximately $125 million in cash, as adjusted for customary adjustments set forth in the Merger Agreement and the assumption of Hearsay employee equity awards. We also offered participation rights to key employees and former founders of Hearsay in a bonus pool of $20 million that can be settled in cash or our common stock and shall be subject to 100% vesting on the first anniversary of closing, generally subject to continued employment. In addition, subject to the terms of the Merger Agreement, we may also be required to pay additional contingent consideration of up to $75 million to Hearsay based on the achievement of certain milestones (the “Earnout Consideration”). The Earnout Consideration shall be payable based on achievement of certain annual recurring revenue targets. The targets shall be measured at the end of the first and second anniversaries of closing. The Earnout Consideration may be settled in cash or our common stock at our election.

Current wording

Following approval by our Board of Directors, on June 10, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) for the acquisition of Hearsay Social, Inc. (“Hearsay”). Pursuant to the Merger Agreement, Hearsay became a wholly owned subsidiary of Yext upon closing of the transaction on August 1, 2024. The acquisition of Hearsay is intended to produce an end-to-end digital presence platform, combining Yext’s cutting-edge digital presence management capabilities with Hearsay’s compliant engagement solutions across social media, websites, text, and voice. We acquired Hearsay for approximately $125 million in cash, as adjusted for customary adjustments set forth in the Merger Agreement and the assumption of Hearsay employee equity awards. We also offered participation rights to key employees and former founders of Hearsay in a bonus pool of $20 million that can be settled in cash or our common stock and shall be subject to 100% vesting on the first anniversary of closing, generally subject to continued employment. In addition, subject to the terms of the Merger Agreement, we may also be required to pay additional contingent consideration of up to $75 million to Hearsay based on the achievement of certain milestones (the “Earnout”). The Earnout shall be payable based on achievement of certain annual recurring revenue targets. The targets shall be measured at the end of the first and second anniversaries of closing. The Earnout may be settled in cash or our common stock at our election. See Note 4 "Business Combination" to our condensed consolidated financial statements for additional information.

Previous wording

(1)ARR as of July 31, 2024 includes a decrease of $10.8 million related to the attrition of a large customer, which occurred during the three months ended January 31, 2024.

Current wording

(2)ARR as of October 31, 2024 includes a decrease of $10.8 million related to the attrition of a large customer, which occurred during the three months ended January 31, 2024.

Previous wording

This metric is calculated first by determining the ARR generated 12 months prior to the end of the current period for a cohort of customers who had active contracts at that time. We then calculate ARR from the same cohort of customers at the end of the current period, which includes customer expansion, contraction and churn. The current period ARR is then divided by the prior period ARR to arrive at our dollar-based net retention rate. The cohorts of customers that we present dollar-based net retention rate for include direct, third-party reseller, and total customers. Direct customers include enterprise, mid-size and small business customers.

Current wording

This metric is calculated first by determining the ARR generated 12 months prior to the end of the current period for a cohort of customers who had active contracts at that time. We then calculate ARR from the same cohort of customers at the end of the current period, which includes customer expansion, contraction and churn. The current period ARR is then divided by the prior period ARR to arrive at our dollar-based net retention rate. Any ARR obtained through merger and acquisition transactions does not affect the dollar-based net retention rate until one year from the date on which the transaction closed. The cohorts of customers that we present dollar-based net retention rate for include direct, third-party reseller, and total customers. Direct customers include enterprise, mid-size and small business customers.

Previous wording

Customer count is defined as the total number of customers with contracts executed as of the last day of the reporting period and a unique administrative account identifier on our platform. Generally, we assign unique administrative accounts to each separate and distinct entity (such as a company or government institution) or a business unit of a large corporation, that has its own separate contract with us to access our platform. We believe that customer count provides insight into our ability to grow our enterprise and mid-size customer base. As such, customer count excludes third-party reseller customers and small business customers as well as customers only receiving free trials. From time to time, some customers previously characterized as small business customers may transition to mid-size customers, and customer count includes these changes resulting from any recharacterization. As of July 31, 2024, customer count was approximately 2,970.

Current wording

Customer count is defined as the total number of customers with contracts executed as of the last day of the reporting period and a unique administrative account identifier on our platform. Generally, we assign unique administrative accounts to each separate and distinct entity (such as a company or government institution) or a business unit of a large corporation, that has its own separate contract with us to access our platform. We believe that customer count provides insight into our ability to grow our enterprise and mid-size customer base. As such, customer count excludes third-party reseller customers and small business customers as well as customers only receiving free trials. From time to time, some customers previously characterized as small business customers may transition to mid-size customers, and customer count includes these changes resulting from any recharacterization. As of October 31, 2024, customer count was over 3,000.

Previous wording

Cost of revenue consists primarily of employee-related costs, including personnel-related costs, which mainly consist of salaries and wages, and stock-based compensation expense. Cost of revenue also includes fees associated with our Publisher Network application provider arrangements, the nature of which may be unpaid, fixed, or variable, and are unpaid with many of our larger providers, as well as the costs associated with our data centers. In addition, cost of revenue includes depreciation expense, which includes amounts allocated based on employee headcount, as well as amounts related to certain capitalized software development costs incurred in connection with additional functionality to our platform. Cost of revenue also includes lease expenses associated with our office spaces, which are allocated based on employee headcount. In addition, cost of revenue includes software expense, which relates to licenses, professional services, and other costs associated with software for use in the operations of our business, which is also allocated based on employee headcount.

Current wording

Cost of revenue consists primarily of employee-related costs, including personnel-related costs, which mainly consist of salaries and wages, and stock-based compensation expense. Cost of revenue also includes fees associated with our Publisher Network application provider arrangements, the nature of which may be unpaid, fixed, or variable, and are unpaid with many of our larger providers, as well as the costs associated with our data centers. In addition, cost of revenue includes depreciation expense, which includes amounts allocated based on employee headcount, as well as amounts related to certain capitalized software development costs incurred in connection with additional functionality to our platform. Cost of revenue also includes amortization expense, which includes amounts related to intangible assets arising from acquisitions and lease expenses associated with our office spaces, which are allocated based on employee headcount. In addition, cost of revenue includes software expense, which relates to licenses, professional services, and other costs associated with software for use in the operations of our business, which is also allocated based on employee headcount.

Previous wording

Sales and marketing expenses. Sales and marketing expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages and costs of obtaining revenue contracts. Sales and marketing expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, sales and marketing expenses include costs related to advertising and conferences and brand awareness events.

Current wording

Sales and marketing expenses. Sales and marketing expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages and costs of obtaining revenue contracts. Sales and marketing expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, sales and marketing expenses include amortization expense, which includes amounts related to intangible assets arising from acquisitions, as well as costs related to advertising and conferences and brand awareness events.

Previous wording

General and administrative expenses. General and administrative expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense for our finance and accounting, human resources, information technology and legal support departments. Personnel-related costs mainly consist of salaries and wages. General and administrative expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount, and other professional related costs.

Current wording

General and administrative expenses. General and administrative expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense for our finance and accounting, human resources, information technology and legal support departments. Personnel-related costs mainly consist of salaries and wages. General and administrative expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, general and administrative expenses include other professional related costs which include acquisition-related costs, as well as fair value adjustments related to contingent consideration.

Previous wording

Total revenue was $97.9 million for the three months ended July 31, 2024, compared to $102.6 million for the three months ended July 31, 2023, a decrease of $4.7 million or 5%, primarily driven by the attrition of a large customer that occurred during the three months ended January 31, 2024. During the three months ended July 31, 2024 and 2023, revenue recognized from subscription and associated support to our platform was 93%, while revenue recognized from professional services was 7%, compared to 92% and 8%, respectively.

Current wording

Total revenue was $114.0 million for the three months ended October 31, 2024, compared to $101.2 million for the three months ended October 31, 2023, an increase of $12.8 million or 13%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which did not exist in the comparative period. The increase was negatively affected by the resulting absence of revenue from the attrition of a large customer that did not renew their contract as of January 31, 2024. During the three months ended October 31, 2024 and 2023, revenue recognized from subscription and associated support to our platform was 94%, while revenue recognized from professional services was 6%, compared to 92% and 8%, respectively.

Previous wording

Revenue for the three months ended July 31, 2024, was not significantly impacted by foreign currency exchange rates using a constant currency basis. We calculate constant currency by translating our current period results for entities reporting in currencies other than U.S. Dollars (“USD”) into USD at the average monthly exchange rates in effect during the comparative period, as opposed to the average monthly exchange rates in effect during the current period.

Current wording

Revenue for the three months ended October 31, 2024, included a positive impact from foreign currency exchange rates of approximately $1.3 million, using a constant currency basis. We calculate constant currency by translating our current period results for entities reporting in currencies other than U.S. Dollars (“USD”) into USD at the average monthly exchange rates in effect during the comparative period, as opposed to the average monthly exchange rates in effect during the current period.

Previous wording

Revenue attributable to direct customers was $79.3 million for the three months ended July 31, 2024, compared to $82.8 million for the three months ended July 31, 2023. The decrease of $3.6 million, or 4%, was primarily driven by the attrition of a large customer that occurred during the three months ended January 31, 2024. Revenue attributable to third-party reseller customers was $18.6 million for the three months ended July 31, 2024, compared to $19.8 million for the three months ended July 31, 2023, a decrease of $1.1 million or 6%, primarily due to customer attrition.

Current wording

Revenue attributable to direct customers was $95.5 million for the three months ended October 31, 2024, compared to $82.3 million for the three months ended October 31, 2023, an increase of $13.2 million, or 16%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which did not exist in the comparative period. The increase was negatively affected by the resulting absence of revenue from the attrition of a large customer that did not renew their contract as of January 31, 2024. Revenue attributable to third-party reseller customers was $18.5 million for the three months ended October 31, 2024, compared to $18.9 million for the three months ended October 31, 2023, a decrease of $0.4 million or 2%, primarily due to customer attrition.

Previous wording

Gross margin was 77.2% for the three months ended July 31, 2024, compared to 78.2% for the three months ended July 31, 2023 as reflected in the discussion above.

Current wording

Gross margin was 77.0% for the three months ended October 31, 2024, compared to 78.2% for the three months ended October 31, 2023 as reflected in the discussion above.

Previous wording

Total revenue was $193.9 million for the six months ended July 31, 2024, compared to $202.1 million for the six months ended July 31, 2023, a decrease of $8.2 million or 4%, primarily driven by the attrition of a large customer that occurred during the three months ended January 31, 2024. During the six months ended July 31, 2024 and 2023, revenue recognized from subscription and associated support to our platform was 93%, while revenue recognized from professional services was 7%, compared to 92% and 8%, respectively.

Current wording

Total revenue was $307.9 million for the nine months ended October 31, 2024, compared to $303.2 million for the nine months ended October 31, 2023, an increase of $4.7 million or 2%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which did not exist in the comparative period. The increase was negatively affected by the resulting absence of revenue from the attrition of a large customer that did not renew their contract as of January 31, 2024. During the nine months ended October 31, 2024 and 2023, revenue recognized from subscription and associated support to our platform was 93%, while revenue recognized from professional services was 7%, compared to 92% and 8%, respectively.

Previous wording

Revenue for the six months ended July 31, 2024, included a positive impact from foreign currency exchange rates of approximately $0.4 million, using a constant currency basis. We calculate constant currency by translating our current period results for entities reporting in currencies other than USD into USD at the average monthly exchange rates in effect during the comparative period, as opposed to the average monthly exchange rates in effect during the current period.

Current wording

Revenue for the nine months ended October 31, 2024, included a positive impact from foreign currency exchange rates of approximately $1.6 million, using a constant currency basis. We calculate constant currency by translating our current period results for entities reporting in currencies other than USD into USD at the average monthly exchange rates in effect during the comparative period, as opposed to the average monthly exchange rates in effect during the current period.

Previous wording

Revenue attributable to direct customers was $156.7 million for the six months ended July 31, 2024, compared to $162.9 million for the six months ended July 31, 2023. The decrease of $6.2 million, or 4%, was primarily driven by the attrition of a large customer that occurred during the three months ended January 31, 2024. Revenue attributable to third-party reseller customers was $37.2 million for the six months ended July 31, 2024, compared to $39.2 million for the six months ended July 31, 2023, a decrease of $2.0 million or 5%, primarily due to customer attrition.

Current wording

Revenue attributable to direct customers was $252.2 million for the nine months ended October 31, 2024, compared to $245.1 million for the nine months ended October 31, 2023, an increase of $7.0 million, or 3%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which did not exist in the comparative period. The increase was negatively affected by the resulting absence of revenue from the attrition of a large customer that did not renew their contract as of January 31, 2024. Revenue attributable to third-party reseller customers was $55.7 million for the nine months ended October 31, 2024, compared to $58.1 million for the nine months ended October 31, 2023, a decrease of $2.4 million or 4%, primarily due to customer attrition.

Previous wording

Cost of revenue was $43.8 million for the six months ended July 31, 2024, compared to $43.7 million for the six months ended July 31, 2023, an increase of $0.1 million or less than 1%. The increase was primarily driven by a $1.0 million increase in personnel-related costs, mainly due to severance recognized from restructuring. In addition, professional related costs increased $0.4 million and data center costs increased $0.4 million. These increases were partially offset by a $1.7 million decrease in depreciation expense as certain assets have fully depreciated.

Current wording

Cost of revenue was $70.1 million for the nine months ended October 31, 2024, compared to $65.8 million for the nine months ended October 31, 2023, an increase of $4.3 million or 6%. The increase was primarily driven by the acquisition of Hearsay which resulted in a $2.0 million increase in amortization expense related to acquired intangible assets, as well as $0.7 million related to royalties and integration fees. In addition, data center costs increased $1.3 million mainly due to incremental costs from Hearsay, professional related costs increased $0.8 million and personnel-related costs increased $0.6 million, mainly due to incremental costs of $0.9 million associated with the acquisition of Hearsay. These increases were partially offset by a $1.9 million decrease in depreciation expense, as certain assets have fully depreciated.

Previous wording

Gross margin was 77.4% for the six months ended July 31, 2024, compared to 78.4% for the six months ended July 31, 2023 as reflected in the discussion above.

Current wording

Gross margin was 77.2% for the nine months ended October 31, 2024, compared to 78.3% for the nine months ended October 31, 2023 as reflected in the discussion above.

Previous wording

Research and development expense was $35.6 million for the six months ended July 31, 2024 and 2023, which remained relatively consistent, resulting in a decrease of less than 1%. The decrease was primarily driven by a $0.4 million decrease in depreciation expense as certain assets have fully depreciated, a $0.3 million decrease in professional and recruiting fees, and smaller decreases in stock-based compensation expense, among others. These decreases were partially offset by a $1.6 million increase in personnel-related costs, mainly due to severance recognized from restructuring.

Current wording

Research and development expense was $56.7 million for the nine months ended October 31, 2024, compared to $53.9 million for the nine months ended October 31, 2023, an increase of $2.8 million or 5%. The increase was primarily driven by a $4.4 million increase in personnel-related costs, mainly due to incremental costs of $5.4 million associated with the acquisition of Hearsay. This increase was partially offset by decreases in depreciation expense of $0.5 million, as certain assets have fully depreciated, a $0.5 million decrease in stock-based compensation expense, and a $0.4 million decrease in professional related costs.

Previous wording

Net loss was $4.1 million and $7.9 million for the three and six months ended July 31, 2024, respectively and $3.4 million and $3.8 million for the three and six months ended July 31, 2023, respectively.

Current wording

Net loss was $12.8 million and $20.7 million for the three and nine months ended October 31, 2024, respectively and $0.5 million and $4.3 million for the three and nine months ended October 31, 2023, respectively.

Previous wording

Non-GAAP net income (loss) is a financial measure that is not calculated in accordance with GAAP. We define non-GAAP net income (loss) as our GAAP net income (loss) as adjusted to exclude the effects of stock-based compensation expense, acquisition-related costs, amortization of acquired intangibles, and the related income tax effect of these adjustments. Acquisition-related costs include transaction costs, subsequent fair value movements in contingent consideration, and compensation arrangements. We believe non-GAAP net income (loss) provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of our results of operations. We also believe non-GAAP net income (loss) is useful in evaluating our operating performance compared to that of other companies in our industry, as it eliminates the effects of stock-based compensation, acquisition-related costs, and amortization of acquired intangibles, which may vary for reasons unrelated to overall operating performance.

Current wording

Non-GAAP net income (loss) is a financial measure that is not calculated in accordance with GAAP. We define non-GAAP net income (loss) as our GAAP net income (loss) as adjusted to exclude the effects of stock-based compensation expense, acquisition-related costs, amortization of acquired intangibles, and the related income tax effect of these adjustments. Acquisition-related costs include transaction and related costs, subsequent fair value movements in contingent consideration, and compensation arrangements. We believe non-GAAP net income (loss) provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of our results of operations. We also believe non-GAAP net income (loss) is useful in evaluating our operating performance compared to that of other companies in our industry, as it eliminates the effects of stock-based compensation, acquisition-related costs, and amortization of acquired intangibles, which may vary for reasons unrelated to overall operating performance.

Previous wording

Adjusted EBITDA is a non-GAAP financial measure that we believe offers a useful view of overall operations used to assess the performance of core business operations and for planning purposes. We define Adjusted EBITDA as GAAP net income (loss) before (1) interest income (expense), net, (2) benefit from (provision for) income taxes, (3) depreciation and amortization, (4) other income (expense), net, (5) stock-based compensation expense, and (6) acquisition-related costs. The most directly comparable GAAP financial measure to Adjusted EBITDA is GAAP net income (loss). Users should consider the limitations of using Adjusted EBITDA, including the fact that this measure does not provide a complete measure of our operating performance. Adjusted EBITDA is not intended to purport to be an alternate to GAAP net income (loss) as a measure of operating performance.

Current wording

Adjusted EBITDA is a non-GAAP financial measure that we believe offers a useful view of overall operations used to assess the performance of core business operations and for planning purposes. We define Adjusted EBITDA as GAAP net income (loss) before (1) interest income (expense), net, (2) (provision for) benefit from income taxes, (3) depreciation and amortization, (4) other income (expense), net, (5) stock-based compensation expense, and (6) acquisition-related costs. The most directly comparable GAAP financial measure to Adjusted EBITDA is GAAP net income (loss). Users should consider the limitations of using Adjusted EBITDA, including the fact that this measure does not provide a complete measure of our operating performance. Adjusted EBITDA is not intended to purport to be an alternate to GAAP net income (loss) as a measure of operating performance.

Previous wording

As of July 31, 2024, our principal sources of liquidity were cash and cash equivalents of $234.8 million. We believe our existing cash and cash equivalents, inclusive of our acquisition of Hearsay on August 1, 2024, will be sufficient to meet our projected operating requirements for at least the next 12 months. Our cash flows, including net cash used in or provided by operating activities, may vary significantly from quarter to quarter, due to the timing of billings, cash collections and lease payments, significant marketing events and related expenses, and other factors.

Current wording

As of October 31, 2024, our principal sources of liquidity were cash and cash equivalents of $100.5 million. We believe our existing cash and cash equivalents, will be sufficient to meet our projected operating requirements for at least the next 12 months. Our cash flows, including net cash used in or provided by operating activities, may vary significantly from quarter to quarter, due to the timing of billings, cash collections and lease payments, significant marketing events and related expenses, acquisitions, and other factors.

Previous wording

In March 2022, our Board of Directors authorized a $100.0 million share repurchase program of our common stock. In September 2023, our Board of Directors authorized an additional $50.0 million to the share repurchase program. During the six months ended July 31, 2024, 43,270 shares were purchased and as of July 31, 2024, approximately $49.8 million remains available for future purchases, exclusive of commissions paid on the repurchase of shares.

Current wording

In March 2022, our Board of Directors authorized a $100.0 million share repurchase program of our common stock. In September 2023, our Board of Directors authorized an additional $50.0 million to the share repurchase program. During the nine months ended October 31, 2024, 1,083,458 shares were purchased and as of October 31, 2024, approximately $43.1 million remains available for future purchases, exclusive of commissions paid on the repurchase of shares.

Previous wording

Net cash provided by operating activities of $27.7 million for the six months ended July 31, 2024 reflected our net loss of $7.9 million, adjusted by non-cash charges including stock-based compensation expense of $24.4 million, depreciation and amortization expense of $5.8 million, and amortization of operating lease right-of-use assets of $4.3 million. In addition, there were positive adjustments resulting from changes in accounts receivable of $62.0 million, mainly due to the timing of billing and cash collections during the period, as well as changes in costs to obtain revenue contracts of $7.6 million. These increases were partially offset by changes in unearned revenue of $56.4 million, as well as changes in accounts payable, accrued expenses and other current liabilities of $4.6 million, operating lease liabilities of $5.7 million, and prepaid expenses and other current assets of $3.2 million.

Current wording

Net cash provided by operating activities of $11.9 million for the nine months ended October 31, 2024 reflected our net loss of $20.7 million, adjusted by non-cash charges including stock-based compensation expense of $37.1 million, depreciation and amortization expense of $12.1 million, including $3.5 million related to the amortization of acquired intangibles, as well as $6.5 million related to the amortization of operating lease right-of-use assets. In addition, there were positive adjustments resulting from changes in accounts receivable of $55.3 million, mainly due to the timing of billing and cash collections during the period, as well as changes in costs to obtain revenue contracts of $10.5 million and $7.2 million in accounts payable, accrued expenses and other current liabilities. These increases were partially offset by changes in unearned revenue of $89.1 million, and operating lease liabilities of $8.3 million.

Previous wording

Net cash provided by operating activities of $19.7 million for the six months ended July 31, 2023 reflected our net loss of $3.8 million, adjusted by non-cash charges including stock-based compensation expense of $22.6 million, depreciation and amortization expense of $9.1 million, and amortization of operating lease right-of-use assets of $4.6 million. In addition, there were positive adjustments resulting from changes in accounts receivable of $54.9 million, mainly due to timing of billing and cash collections during the period, as well as changes in costs to obtain revenue contracts of $6.6 million. These increases were partially offset by changes in unearned revenue of $55.3 million, as well as changes in accounts payable, accrued expenses and other current liabilities of $14.2 million, and operating lease liabilities of $5.8 million.

Current wording

Net cash provided by operating activities of $18.l million for the nine months ended October 31, 2023 reflected our net loss of $4.3 million, adjusted by non-cash charges including stock-based compensation expense of $34.3 million, depreciation and amortization expense of $12.6 million, and amortization of operating lease right-of-use assets of $6.7 million. In addition, there were positive adjustments resulting from changes in accounts receivable of $57.3 million, mainly due to the timing of billing and cash collections during the period, as well as changes in costs to obtain revenue contracts of $9.l million. These increases were partially offset by changes in unearned revenue of $78.4 million, as well as changes in accounts payable, accrued expenses and other current liabilities of $9.2 million, and operating lease liabilities of $8.9 million.

Previous wording

Net cash used in investing activities of $1.2 million for the six months ended July 31, 2024 reflected capital expenditures.

Current wording

Net cash used in investing activities of $2.3 million for the nine months ended October 31, 2023 reflected capital expenditures.

Previous wording

Net cash used in financing activities of $2.0 million for the six months ended July 31, 2024 was primarily related to $3.8 million in cash outflows associated with payments for taxes related to the net share settlement of stock-based compensation awards. This was partially offset by net proceeds from employee stock purchase plan withholdings of $1.8 million.

Current wording

Net cash used in financing activities of $13.2 million for the nine months ended October 31, 2024 was primarily related to cash outflows of $9.0 million associated with payments for taxes related to the net share settlement of stock-based compensation awards, as well as $6.8 million associated with repurchases of common stock as part of our share repurchase program. This was partially offset by net proceeds from employee stock purchase plan withholdings of $2.2 million.

Previous wording

There have been no material changes to our critical accounting policies and estimates as compared to those disclosed in our Annual Report on Form 10-K.

Current wording

Except as described in Note 2 "Summary of Significant Accounting Policies- Recent Accounting Pronouncements", to the condensed consolidated financial statements, there have been no material changes to our critical accounting policies and estimates as compared to those disclosed in our Annual Report on Form 10-K.