Snowflake Inc.

Previous wording

Our cloud-native architecture includes three independently scalable but logically integrated layers across compute, storage, and cloud services. The compute layer provides dedicated resources to enable users to simultaneously access common data sets for many use cases with minimal latency. The storage layer ingests massive amounts and varieties of structured, semi-structured, and unstructured data to create a unified data record. The cloud services layer intelligently optimizes each use case’s performance requirements with no administration. This architecture is built on three major public clouds across 49 regional deployments around the world. These deployments are generally interconnected to deliver the AI Data Cloud, enabling a consistent, global user experience.

Current wording

Our cloud-native architecture includes three independently scalable but logically integrated layers across compute, storage, and cloud services. The compute layer provides dedicated resources to enable users to simultaneously access common data sets for many use cases with minimal latency. The storage layer ingests massive amounts and varieties of structured, semi-structured, and unstructured data to create a unified data record. The cloud services layer intelligently optimizes each use case’s performance requirements with no administration. This architecture is built on three major public clouds across 50 regional deployments around the world. These deployments are generally interconnected to deliver the AI Data Cloud, enabling a consistent, global user experience.

Previous wording

Our go-to-market strategy is focused on acquiring new customers and driving increased use of our platform for existing customers. We primarily focus our selling efforts on large organizations and primarily sell our platform through a direct sales force, which targets technical and business leaders who are adopting a cloud strategy and leveraging data to improve their business performance. Our sales force is comprised of sales development, inside sales, and field sales personnel and is segmented by the industry, size, and region of prospective customers. Once our platform has been adopted, we focus on increasing the migration of additional customer workloads to our platform to drive increased consumption, as evidenced by our net revenue retention rate of 125% and 126% as of July 31, 2025 and January 31, 2025, respectively. See the section titled “Key Business Metrics” for a definition of net revenue retention rate.

Current wording

Our go-to-market strategy is focused on acquiring new customers and driving increased use of our platform for existing customers. We primarily focus our selling efforts on large organizations and primarily sell our platform through a direct sales force, which targets technical and business leaders who are adopting a cloud strategy and leveraging data to improve their business performance. Our sales force is comprised of inside and field sales, solution engineering, sales development, partner sales, and specialist sales personnel and is segmented by the industry, size, and region of prospective customers. Once our platform has been adopted, we focus on increasing the migration of additional customer workloads to our platform to drive increased consumption, as evidenced by our net revenue retention rate of 125% and 126% as of October 31, 2025 and January 31, 2025, respectively. See the section titled “Key Business Metrics” for a definition of net revenue retention rate.

Previous wording

Our platform is used globally by organizations of all sizes across a broad range of industries. As of July 31, 2025, we had 12,062 total customers, increasing from 11,078 customers as of January 31, 2025. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments. Our platform has been adopted by many of the world’s largest organizations that view Snowflake as a key strategic partner in their cloud and data transformation initiatives. As of July 31, 2025, our customers included 751 of the Forbes Global 2000, based on the 2025 Forbes Global 2000 list, and those customers contributed approximately 42% of our revenue for the six months ended July 31, 2025. Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the Global 2000 list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments.

Current wording

Our platform is used globally by organizations of all sizes across a broad range of industries. As of October 31, 2025, we had 12,621 total customers, increasing from 11,023 customers as of January 31, 2025. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments. Our platform has been adopted by many of the world’s largest organizations that view Snowflake as a key strategic partner in their cloud and data transformation initiatives. As of October 31, 2025, our customers included 766 of the Forbes Global 2000, based on the 2025 Forbes Global 2000 list, and those customers contributed approximately 42% of our revenue for the nine months ended October 31, 2025. Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the Global 2000 list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments. See the section titled “Key Business Metrics” for how we determine our customer count.

Previous wording

New software releases or hardware improvements, like better storage compression, cloud infrastructure processor improvements, and compute optimization, may make our platform more efficient, enabling customers to consume fewer compute, storage, and data transfer resources to accomplish the same workloads. In addition, open data formats allow customers to use our platform for compute services without requiring storage. To the extent these improvements do not result in an offsetting increase in new workloads, we may experience lower revenue. Our ability to increase usage of our platform by, and sell additional contracted capacity to, existing customers, and, in particular, large enterprise customers, will depend on a number of factors, including our customers’ satisfaction with our platform, competition, pricing, macroeconomic conditions, overall changes in our customers’ spending levels, customers’ attempts to optimize their consumption, our customers’ confidence in the security of our platform, our ability to maintain our reputation as a trustworthy vendor, the effectiveness of our and our partners’ efforts to help our customers realize the benefits of our platform, and the extent to which customers migrate new workloads to our platform over time, including data science, AI, and machine learning workloads.

Current wording

New software releases or hardware improvements, like better storage compression, cloud infrastructure processor improvements, and compute optimization, may make our platform more efficient, enabling customers to consume fewer compute, storage, and data transfer resources to accomplish the same workloads. In addition, open data formats allow customers to use our platform for compute services without requiring storage. To the extent these improvements do not result in an offsetting increase in new workloads, we may experience lower revenue. Our ability to increase usage of our platform by, and sell additional contracted capacity to, existing customers, and, in particular, large enterprise customers, will depend on a number of factors, including our customers’ satisfaction with our platform, our customers’ adoption and use of new product features, competition, pricing, macroeconomic conditions, overall changes in our customers’ spending levels, customers’ attempts to optimize their consumption, our customers’ confidence in the security of our platform, our ability to maintain our reputation as a trustworthy vendor, the effectiveness of our and our partners’ efforts to help our customers realize the benefits of our platform, and the extent to which customers migrate new workloads to our platform over time, including data science, AI, and machine learning workloads.

Previous wording

Our future success also depends on our ability to acquire new customers. We believe there is a substantial opportunity to further grow our customer base by continuing to make significant investments in sales and marketing and brand awareness. Our ability to attract new customers will depend on a number of factors, including the productivity of our sales organization, competitive dynamics in our target markets, changes in our customers’ spending and platform consumption in response to market uncertainty, our ability to mitigate reputational damage following cybersecurity threat activity directed at our customers, and our ability to build and maintain partner relationships, including with global system integrators, resellers, technology partners, and third-party providers of native applications on the Snowflake Marketplace. While our platform is built for organizations of all sizes, we focus our selling efforts on large enterprise customers, customers with vast amounts of data, and customers requiring industry-specific solutions. We may not achieve anticipated revenue growth if we are unable to attract, hire, develop, integrate, and retain talented and effective sales personnel; if our sales personnel are unable to achieve desired productivity levels in a reasonable period of time and maintain productivity; or if our sales and marketing programs are not effective.

Current wording

Our future success also depends on our ability to acquire new customers. We believe there is a substantial opportunity to further grow our customer base by continuing to make significant investments in sales and marketing and brand awareness. Our ability to attract new customers will depend on a number of factors, including the productivity of our sales organization, competitive dynamics in our target markets, changes in our customers’ spending and platform consumption in response to market uncertainty, our ability to promote, maintain, and enhance our brand and reputation, our ability to mitigate reputational damage following cybersecurity threat activity directed at our customers, and our ability to build and maintain partner relationships, including with global system integrators, resellers, technology partners, and third-party providers of native applications on the Snowflake Marketplace. While our platform is built for organizations of all sizes, we focus our selling efforts on large enterprise customers, customers with vast amounts of data, and customers requiring industry-specific solutions. We may not achieve anticipated revenue growth if we are unable to attract, hire, develop, integrate, and retain talented and effective sales personnel; if our sales personnel are unable to achieve desired productivity levels in a reasonable period of time and maintain productivity; or if our sales and marketing programs are not effective.

Previous wording

(3)Cash outflows for employee payroll tax items related to the net share settlement of equity awards were $162.0 million, $132.5 million, $129.5 million, $81.5 million, and $103.5 million for the three months ended July 31, 2025, April 30, 2025, January 31, 2025, October 31, 2024, and July 31, 2024, respectively. These amounts are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of non-GAAP free cash flow. See the section titled “Free Cash Flow” for a reconciliation of net cash provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP, to non-GAAP free cash flow.

Current wording

(3)Cash outflows for employee payroll tax items related to the net share settlement of equity awards were $190.7 million, $162.0 million, $132.5 million, $129.5 million, and $81.5 million for the three months ended October 31, 2025, July 31, 2025, April 30, 2025, January 31, 2025, and October 31, 2024, respectively. These amounts are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of non-GAAP free cash flow. See the section titled “Free Cash Flow” for a reconciliation of net cash provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP, to non-GAAP free cash flow.

Previous wording

(5)As of July 31, 2025, our remaining performance obligations were approximately $6.9 billion, of which we expect approximately 50% to be recognized as revenue in the 12 months ending July 31, 2026 based on historical customer consumption patterns. The weighted-average remaining life of our capacity contracts was 2.4 years as of July 31, 2025. However, the amount and timing of revenue recognition are generally dependent upon customers’ future consumption, which is inherently variable at our customers’ discretion and can extend beyond the original contract term in cases where customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. In addition, our historical customer consumption patterns are not necessarily indicative of future results.

Current wording

(5)As of October 31, 2025, our remaining performance obligations were approximately $7.9 billion, of which we expect approximately 48% to be recognized as revenue in the 12 months ending October 31, 2026 based on historical customer consumption patterns. The weighted-average remaining life of our capacity contracts was 2.5 years as of October 31, 2025. However, the amount and timing of revenue recognition are generally dependent upon customers’ future consumption, which is inherently variable at our customers’ discretion and can extend beyond the original contract term in cases where customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. In addition, our historical customer consumption patterns are not necessarily indicative of future results.

Previous wording

(2)Cash outflows for employee payroll tax items related to the net share settlement of equity awards were $162.0 million, $132.5 million, $129.5 million, $81.5 million, and $103.5 million for the three months ended July 31, 2025, April 30, 2025, January 31, 2025, October 31, 2024, and July 31, 2024, respectively. These amounts are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow.

Current wording

(2)Cash outflows for employee payroll tax items related to the net share settlement of equity awards were $190.7 million, $162.0 million, $132.5 million, $129.5 million, and $81.5 million for the three months ended October 31, 2025, July 31, 2025, April 30, 2025, January 31, 2025, and October 31, 2024, respectively. These amounts are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow.

Previous wording

We deliver our platform over the internet as a service. Customers choose to consume our platform under either capacity arrangements, in which they commit to a certain amount of consumption at specified prices, or under on-demand arrangements, in which we charge for use of our platform monthly in arrears. Under capacity arrangements, from which a majority of our revenue is derived, we typically bill our customers annually in advance of their consumption. However, in future periods, we expect to see an increase in capacity contracts providing for quarterly upfront billings and monthly in arrears billings as our customers increasingly want to align consumption and timing of payments. Revenue from on-demand arrangements typically relates to customers with lower usage levels or overage consumption beyond a customer’s contracted usage amount under a capacity contract or following the expiration of a customer’s capacity contract. Revenue from on-demand arrangements represented approximately 2% of our revenue for each of the three and six months ended July 31, 2025 and 2024.

Current wording

We deliver our platform over the internet as a service. Customers choose to consume our platform under either capacity arrangements, in which they commit to a certain amount of consumption at specified prices, or under on-demand arrangements, in which we charge for use of our platform monthly in arrears. Under capacity arrangements, from which a majority of our revenue is derived, we typically bill our customers annually in advance of their consumption. However, in future periods, we expect to see an increase in capacity contracts providing for quarterly upfront billings and monthly in arrears billings as our customers increasingly want to align consumption and timing of payments. Revenue from on-demand arrangements typically relates to customers with lower usage levels or overage consumption beyond a customer’s contracted usage amount under a capacity contract or following the expiration of a customer’s capacity contract. Revenue from on-demand arrangements represented approximately 2% of our revenue for each of the three and nine months ended October 31, 2025 and 2024.

Previous wording

We recognize revenue as customers consume compute, storage, and data transfer resources under either of these arrangements. In limited instances, customers pay an annual deployment fee to gain access to a dedicated instance of a virtual private deployment. We recognize the deployment fee ratably over the contract term. Such deployment revenue represented less than 1% of our revenue for each of the three and six months ended July 31, 2025 and 2024.

Current wording

We recognize revenue as customers consume compute, storage, and data transfer resources under either of these arrangements. In limited instances, customers pay an annual deployment fee to gain access to a dedicated instance of a virtual private deployment. We recognize the deployment fee ratably over the contract term. Such deployment revenue represented less than 1% of our revenue for each of the three and nine months ended October 31, 2025 and 2024.

Previous wording

Our customer contracts for capacity typically have a term of one to four years. The weighted-average term of capacity contracts entered into during the three and six months ended July 31, 2025 is approximately 3.0 years and 2.9 years, respectively. To the extent our customers enter into such contracts and either consume our platform in excess of their capacity commitments or continue to use our platform after expiration of the contract term, they are charged for their incremental consumption. In many cases, our customer contracts permit customers to roll over any unused capacity to a subsequent order, generally upon the purchase of additional capacity. For those customers who do not have a capacity arrangement, our on-demand arrangements generally have a monthly stated contract term and can be terminated at any time by either the customer or us.

Current wording

Our customer contracts for capacity typically have a term of one to four years. The weighted-average term of capacity contracts entered into during the three and nine months ended October 31, 2025 is approximately 3.0 years and 2.9 years, respectively. To the extent our customers enter into such contracts and either consume our platform in excess of their capacity commitments or continue to use our platform after expiration of the contract term, they are charged for their incremental consumption. In many cases, our customer contracts permit customers to roll over any unused capacity to a subsequent order, generally upon the purchase of additional capacity. For those customers who do not have a capacity arrangement, our on-demand arrangements generally have a monthly stated contract term and can be terminated at any time by either the customer or us.

Previous wording

Sales and marketing expenses consist primarily of personnel-related expenses associated with our sales and marketing staff, including salaries, benefits, bonuses, and stock-based compensation. Sales and marketing expenses also include sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions. A portion of the sales commissions paid to the sales force is earned based on the level of the customers’ consumption of our platform, and a portion of the commissions paid to the sales force is earned upon the origination, expansion, or renewal of customer contracts. Sales commissions tied to customers’ consumption are expensed in the same period as they are earned. Sales commissions and referral fees earned upon the origination or expansion of customer contracts that are not commensurate with those earned upon the renewal of contracts are capitalized and then amortized over a period of benefit that we determined to be five years. Sales commissions earned upon the renewal of customer contracts, as well as sales commissions earned upon the origination or expansion of customer contracts that are commensurate with those for renewal contracts, are capitalized and then amortized over the respective weighted-average contractual term of the related contracts. Sales and marketing expenses also include advertising costs and other expenses associated with our sales, marketing and business development programs, including our user conferences, offset by proceeds from such conferences and programs. In addition, sales and marketing expenses are comprised of travel-related expenses, software and subscription services dedicated for use by our sales and marketing organizations, amortization of acquired intangible assets, and outside services contracted for sales and marketing purposes. We expect that our sales and marketing expenses will increase in absolute dollars and continue to be our largest operating expense for the foreseeable future as we grow our business. However, we expect that our sales and marketing expenses will decrease as a percentage of our revenue over time, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

Current wording

Sales and marketing expenses consist primarily of personnel-related expenses associated with our sales and marketing staff, including salaries, benefits, bonuses, and stock-based compensation. Sales and marketing expenses also include sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions. A portion of the sales commissions paid to the sales force is earned based on the level of the customers’ consumption of our platform, and a portion of the commissions paid to the sales force is earned upon the origination, expansion, or renewal of customer contracts. Sales commissions tied to customers’ consumption are expensed in the same period as they are earned. Sales commissions and referral fees earned upon the origination or expansion of customer contracts that are not commensurate with those earned upon the renewal of contracts are capitalized and then amortized over a period of benefit that we determined to be five years. Sales commissions earned upon the renewal of customer contracts, as well as sales commissions earned upon the origination or expansion of customer contracts that are commensurate with those for renewal contracts, are capitalized and then amortized over the respective weighted-average contractual term of the related contracts. Sales and marketing expenses also include advertising costs and other expenses associated with our sales, marketing and business development programs, including our user conferences, offset by proceeds from such conferences and programs. In addition, sales and marketing expenses are comprised of travel-related expenses, software and subscription services dedicated for use by our sales and marketing organizations, amortization of acquired intangible assets, and outside services contracted for sales and marketing purposes. We expect that our sales and marketing expenses will increase in absolute dollars and continue to be our largest operating expense for the foreseeable future as we grow our business. However, we expect that our sales and marketing expenses will decrease as a percentage of our revenue over time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

Previous wording

Research and development expenses consist primarily of personnel-related expenses associated with our research and development staff, including salaries, benefits, bonuses, and stock-based compensation. Research and development expenses also include contractor or professional services fees, third-party cloud infrastructure expenses incurred in developing our platform (including those related to GPUs to develop AI Technology), amortization of acquired intangible assets, and expenses associated with software and subscription services dedicated for use by our research and development organization. Prior to fiscal 2026, research and development expenses related to our cloud platform that qualified as internal-use software development costs were capitalized under Accounting Standards Codification (ASC) Topic 350-40, Internal-use Software (ASC 350-40). During the three months ended April 30, 2025, we began marketing the Snowflake platform to selected public sector customers who will have contractual rights to take possession of our software and who will contract with third parties to host our software. As a result, our ongoing and future software development costs related to the Snowflake platform must be accounted for under ASC 985-20, Costs of Software to be Sold, Leased or Marketed (ASC 985-20). Costs that meet the criteria for capitalization under ASC 985-20 are not expected to be material. Software development costs capitalized prior to fiscal 2026 in connection with the Snowflake platform will be amortized over their remaining useful life and recognized as cost of product revenue. See Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details. We expect that our research and development expenses will increase in absolute dollars due to business growth, continued investments in our platform, and a decrease in the amount of software development costs eligible for capitalization. However, we expect that our research and development expenses will decrease as a percentage of our revenue over time, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

Current wording

Research and development expenses consist primarily of personnel-related expenses associated with our research and development staff, including salaries, benefits, bonuses, and stock-based compensation. Research and development expenses also include contractor or professional services fees, third-party cloud infrastructure expenses incurred in developing our platform (including those related to GPUs to develop AI Technology), amortization of acquired intangible assets, and expenses associated with software and subscription services dedicated for use by our research and development organization. Prior to fiscal 2026, research and development expenses related to our cloud platform that qualified as internal-use software development costs were capitalized under Accounting Standards Codification (ASC) Topic 350-40, Internal-use Software (ASC 350-40). During the three months ended April 30, 2025, we began marketing the Snowflake platform to selected public sector customers who will have contractual rights to take possession of our software and who will contract with third parties to host our software. As a result, our ongoing and future software development costs related to the Snowflake platform must be accounted for under ASC 985-20, Costs of Software to be Sold, Leased or Marketed (ASC 985-20). Costs that meet the criteria for capitalization under ASC 985-20 are not expected to be material. Software development costs capitalized prior to fiscal 2026 in connection with the Snowflake platform will be amortized over their remaining useful life and recognized as cost of product revenue. See Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details. We expect that our research and development expenses will increase in absolute dollars due to business growth, continued investments in our platform, and a decrease in the amount of software development costs eligible for capitalization. However, we expect that our research and development expenses will decrease as a percentage of our revenue over time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

Previous wording

General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities, and administrative personnel, including salaries, benefits, bonuses, and stock-based compensation. General and administrative expenses also include external legal, accounting, and other professional services fees, software and subscription services dedicated for use by our general and administrative functions, insurance, unallocated lease costs associated with unused office facilities to accommodate planned headcount growth, and other corporate expenses. We expect that our general and administrative expenses will increase in absolute dollars as our business grows but will decrease as a percentage of our revenue over time, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses. In addition, during the six months ended July 31, 2025, we recognized asset impairment charges of $108.6 million as general and administrative expenses, primarily relating to the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Current wording

General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities, and administrative personnel, including salaries, benefits, bonuses, and stock-based compensation. General and administrative expenses also include external legal, accounting, and other professional services fees, software and subscription services dedicated for use by our general and administrative functions, insurance, unallocated lease costs associated with unused office facilities to accommodate planned headcount growth, and other corporate expenses. We expect that our general and administrative expenses will increase in absolute dollars as our business grows but will decrease as a percentage of our revenue over time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses. In addition, during the nine months ended October 31, 2025, we recognized asset impairment charges of $108.7 million as general and administrative expenses, primarily relating to the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Previous wording

The overall increase in stock-based compensation for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, was primarily attributable to additional equity awards granted to existing and new employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Current wording

The overall increase in stock-based compensation for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, was primarily attributable to additional equity awards granted to existing and new employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Previous wording

As of July 31, 2025, total compensation cost related to unvested awards not yet recognized was $3.5 billion, which will be recognized over a weighted-average period of 2.8 years. See Note 12, “Equity,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Current wording

As of October 31, 2025, total compensation cost related to unvested awards not yet recognized was $3.3 billion, which will be recognized over a weighted-average period of 2.7 years. See Note 12, “Equity,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Previous wording

Product revenue increased $261.2 million and $468.5 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively, primarily due to increased consumption of our platform by existing customers, as evidenced by our net revenue retention rate of 125% as of July 31, 2025.

Current wording

Product revenue increased $258.1 million and $726.6 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively, primarily due to increased consumption of our platform by existing customers, as evidenced by our net revenue retention rate of 125% as of October 31, 2025.

Previous wording

We had 654 customers with product revenue of greater than $1 million for the trailing 12 months ended July 31, 2025, an increase from 504 such customers as of July 31, 2024. Such customers represented approximately 67% and 61% of our product revenue for the trailing 12 months ended July 31, 2025 and 2024, respectively. Within these customers, we had 124 and 45 customers with product revenue of greater than $5 million and $10 million, respectively, for the trailing 12 months ended July 31, 2025. The substantial majority of our revenue was derived from existing customers under capacity arrangements, which represented approximately 98% of our revenue for each of the three and six months ended July 31, 2025 and 2024. The remainder was derived from on-demand arrangements and new customers under capacity arrangements. The preceding historical metrics reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity. For purposes of determining revenue derived from (i) customers with trailing 12-month product revenue greater than $1 million, (ii) new customers, and (iii) existing customers, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers.

Current wording

We had 688 customers with product revenue of greater than $1 million for the trailing 12 months ended October 31, 2025, an increase from 534 such customers as of October 31, 2024. Such customers represented approximately 68% and 66% of our product revenue for the trailing 12 months ended October 31, 2025 and 2024, respectively. Within these customers, we had 134 and 49 customers with product revenue of greater than $5 million and $10 million, respectively, for the trailing 12 months ended October 31, 2025. The substantial majority of our revenue was derived from existing customers under capacity arrangements, which represented approximately 98% and 97% of our revenue for the three and nine months ended October 31, 2025, respectively, and approximately 98% of our revenue for each of the three and nine months ended October 31, 2024. The remainder was derived from on-demand arrangements and new customers under capacity arrangements. The preceding historical metrics reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity. For purposes of determining revenue derived from (i) customers with trailing 12-month product revenue greater than $1 million, (ii) new customers, and (iii) existing customers, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers.

Previous wording

Professional services and other revenue increased $14.9 million and $21.0 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively, as we continued to expand our professional services organization to help our customers further realize the benefits of our platform.

Current wording

Professional services and other revenue increased $12.7 million and $33.8 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively, as our professional services organization continues to expand and evolve to help our customers further realize the benefits of our platform.

Previous wording

Cost of product revenue increased $66.7 million and $132.4 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively. The increase was primarily due to an increase of $58.6 million and $110.3 million in third-party cloud infrastructure expenses (including those related to GPUs) for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased customer consumption of our platform. Amortization of capitalized software development costs and acquired developed technology intangible assets also increased $7.0 million and $14.6 million for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year. The remaining increase in cost of product revenue for the three and six months ended July 31, 2025 was primarily driven by increased personnel-related costs and allocated overhead costs as a result of increased headcount and overall costs to support the growth in our business.

Current wording

Cost of product revenue increased $57.2 million and $189.5 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively. The increase was primarily due to an increase of $63.2 million and $173.5 million in third-party cloud infrastructure expenses (including those related to GPUs) for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased customer consumption of our platform. Amortization of capitalized software development costs and acquired developed technology intangible assets also increased $7.2 million and $21.9 million for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year. The overall increase in cost of product revenue for the three and nine months ended October 31, 2025 was partially offset by a decrease of $12.7 million in costs incurred by us in connection with a restructuring plan for a majority-owned subsidiary, net of associated income and recoveries.

Previous wording

Our product gross margin remained flat at 72% for each of the three and six months ended July 31, 2025 and 2024, primarily due to the decrease in stock-based compensation as a percentage of product revenue, offset by costs attributable to newly launched product capabilities and features that have not yet reached economies of scale. We expect our product gross margin to fluctuate from period to period due to a number of factors, including, but not limited to: (i) fluctuations in the mix and timing of customers’ consumption, which is inherently variable at our customers’ discretion, (ii) our pricing model and discounting practices, (iii) the extent of our investments in new product capabilities, features, and operations, such as investments in AI Technology and performance improvements that may make our platform or the underlying cloud infrastructure more efficient, and (iv) stock-based compensation.

Current wording

Our product gross margin was 72% for each of the three and nine months ended October 31, 2025, compared to 71% for each of the three and nine months ended October 31, 2024, respectively. This slight improvement is primarily due to the decrease in the aforementioned restructuring costs and stock-based compensation as a percentage of product revenue, offset by costs attributable to newly launched product capabilities and features that have not yet reached economies of scale. We expect our product gross margin to fluctuate from period to period due to a number of factors, including, but not limited to: (i) fluctuations in the mix and timing of customers’ consumption, which is inherently variable at our customers’ discretion, (ii) our pricing model and discounting practices, (iii) the extent of our investments in new product capabilities, features, and operations, such as investments in AI Technology and performance improvements that may make our platform or the underlying cloud infrastructure more efficient, and (iv) stock-based compensation.

Previous wording

Cost of professional services and other revenue increased $17.0 million and $27.7 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively. The increase was primarily due to an increase of $12.0 million and $18.8 million in personnel-related costs and allocated overhead costs for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased headcount and stock-based compensation. The remaining increase in cost of professional services and other revenue was primarily driven by an increase of $4.3 million and $7.9 million in costs of contracted third-party partners and software tools to support the growth in our business for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year.

Current wording

Cost of professional services and other revenue increased $12.8 million and $40.4 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively. The increase was primarily due to an increase of $12.5 million and $31.2 million in personnel-related costs and allocated overhead costs for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased headcount and stock-based compensation. The remaining increase in cost of professional services and other revenue for the nine months ended October 31, 2025 was primarily driven by increased costs of contracted third-party partners to support the growth in our business.

Previous wording

Professional services and other gross margin was (28%) and (33%) for the three and six months ended July 31, 2025, respectively, compared to (33%) and (34%) for the three and six months ended July 31, 2024, respectively. We do not believe the year-over-year changes in professional services and other gross margins are meaningful given that our professional services and other revenue represents a small percentage of our revenue.

Current wording

Professional services and other gross margin was (28%) and (32%) for the three and nine months ended October 31, 2025, respectively, compared to (37%) and (35%) for the three and nine months ended October 31, 2024, respectively. We do not believe the year-over-year changes in professional services and other gross margins are meaningful given that our professional services and other revenue represents a small percentage of our revenue.

Previous wording

Sales and marketing expenses increased $101.3 million and $159.1 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively. The increase was primarily due to an increase of $73.4 million and $119.7 million in personnel-related costs (excluding commission expenses) and allocated overhead costs for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased headcount, stock-based compensation, and overall costs to support the growth in our business. The increase in personnel-related costs included a $14.6 million and $28.7 million increase in stock-based compensation for the three and six months ended July 31, 2025, compared to the same periods in the prior year, primarily related to additional equity awards granted to existing and new employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Current wording

Sales and marketing expenses increased $112.4 million and $271.5 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively. The increase was primarily due to an increase of $79.9 million and $199.5 million in personnel-related costs (excluding commission expenses) and allocated overhead costs for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased headcount, stock-based compensation, and overall costs to support the growth in our business. The increase in personnel-related costs included a $18.6 million and $47.3 million increase in stock-based compensation for the three and nine months ended October 31, 2025, compared to the same periods in the prior year, primarily related to additional equity awards granted to existing and new employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Previous wording

Advertising costs and other expenses associated with our sales, marketing and business development programs, as well as travel-related expenses increased $13.8 million and $20.4 million for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year. The remaining increase in sales and marketing expenses for the three and six months ended July 31, 2025 was primarily attributable increased in commission expenses.

Current wording

Advertising costs and other expenses associated with our sales, marketing and business development programs, as well as travel-related expenses increased $14.4 million and $34.7 million for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year. The remaining increase in sales and marketing expenses for the three and nine months ended October 31, 2025 was primarily attributable to increased commission expenses.

Previous wording

Research and development expenses increased $54.3 million and $116.0 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively. The increase was primarily due to an increase of $56.6 million and $112.1 million in personnel-related costs and allocated overhead costs for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased stock-based compensation, headcount, and overall costs to support the growth in our business. The increase in personnel-related costs included a $31.4 million and $57.6 million increase in stock-based compensation for the three and six months ended July 31, 2025, respectively, compared to the same periods in the prior year, primarily related to additional equity awards granted to existing and new employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Current wording

Research and development expenses increased $51.6 million and $167.5 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively. The increase was primarily due to an increase of $65.3 million and $177.4 million in personnel-related costs and allocated overhead costs for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year, as a result of increased stock-based compensation, headcount, and overall costs to support the growth in our business. The increase in personnel-related costs included a $36.9 million and $94.5 million increase in stock-based compensation for the three and nine months ended October 31, 2025, respectively, compared to the same periods in the prior year, primarily related to additional equity awards granted to existing and new employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Previous wording

Interest income remained relatively flat during the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively.

Current wording

General and administrative expenses remained relatively flat during the three months ended October 31, 2025, compared to the three months ended October 31, 2024.

Previous wording

In addition, during the six months ended July 31, 2025, we recognized asset impairment charges of $108.6 million, primarily relating to the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Current wording

General and administrative expenses increased $139.0 million for the nine months ended October 31, 2025, compared to the nine months ended October 31, 2024. During the nine months ended October 31, 2025, we recognized asset impairment charges of $108.7 million, primarily relating to the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Previous wording

General and administrative expenses increased $21.7 million and $138.1 million for the three and six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively. The increase was partially due to an increase of $12.8 million and $20.0 million in personnel-related costs and allocated overhead costs for the three and six months ended July 31, 2025, respectively, compared to same periods in the prior year, as a result of increased headcount, stock-based compensation and overall costs to support the growth in our business. Unallocated lease costs associated with unused office facilities to accommodate planned headcount growth and other corporate expenses also increased $6.6 million and $8.9 million for the three and six months ended July 31, 2025, respectively, compared to same periods in the prior year.

Current wording

In addition, personnel-related costs and allocated overhead costs increased $18.8 million for the nine months ended October 31, 2025, compared to same period in the prior year, as a result of increased headcount, stock-based compensation and overall costs to support the growth in our business. Unallocated lease costs associated with unused office facilities to accommodate planned headcount growth also increased $7.9 million for the nine months ended October 31, 2025, compared to same period in the prior year.

Previous wording

Other expense, net decreased $3.0 million for the three months ended July 31, 2025, and increased $3.8 million for the six months ended July 31, 2025, compared to the three and six months ended July 31, 2024, respectively, primarily due to impairments and changes in net realized and unrealized gains (losses) on our strategic investments in equity securities. See Note 4, “Cash Equivalents, Investments and Strategic Investments,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Current wording

Other expense, net decreased $6.6 million and $2.8 million for the three and nine months ended October 31, 2025, compared to the three and nine months ended October 31, 2024, respectively, primarily due to impairments and changes in net realized and unrealized gains (losses) on our strategic investments in equity securities. See Note 4, “Cash Equivalents, Investments and Strategic Investments,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Previous wording

Our provision for income taxes decreased by $3.7 million for the three months ended July 31, 2025, compared to the three months ended July 31, 2024, primarily due to the partial releases of valuation allowances associated with a business combination completed during the three months ended July 31, 2025.

Current wording

Our provision for income taxes increased by $1.7 million for the three months ended October 31, 2025, compared to the three months ended October 31, 2024, primarily attributable to an increase in our foreign earnings for the three months ended October 31, 2025, and partial releases of valuation allowances associated with a business combination completed during the three months ended October 31, 2024.

Previous wording

Our provision for income taxes remained relatively flat during the six months ended July 31, 2025, compared to the six months ended July 31, 2024.

Current wording

Our provision for income taxes remained relatively flat during the nine months ended October 31, 2025, compared to the nine months ended October 31, 2024.

Previous wording

As of July 31, 2025, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments totaling $4.6 billion. Our cash equivalents and investments primarily consist of corporate notes and bonds, money market funds, U.S. government and agency securities, commercial paper, certificates of deposit, and time deposits.

Current wording

As of October 31, 2025, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments totaling $4.4 billion. Our cash equivalents and investments primarily consist of corporate notes and bonds, money market funds, U.S. government and agency securities, commercial paper, time deposits, and certificates of deposit.

Previous wording

As of July 31, 2025, our RPO was $6.9 billion. Our RPO represents the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods, but that are not recorded on the balance sheet. Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S. dollars each period based on the applicable period-end exchange rates.

Current wording

As of October 31, 2025, our RPO was $7.9 billion. Our RPO represents the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods, but that are not recorded on the balance sheet. Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S. dollars each period based on the applicable period-end exchange rates.

Previous wording

Our primary sources of cash are payments received from our customers as well as net proceeds from the issuance of our convertible senior notes. Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses (including those related to GPUs to develop AI Technology), sales and marketing expenses, overhead costs, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our authorized stock repurchase program. As of July 31, 2025, our material cash requirements from known contractual obligations and commitments relate primarily to (i) third-party cloud infrastructure agreements, (ii) our convertible senior notes, (iii) operating leases for office facilities, and (iv) subscription arrangements used to facilitate our operations at the enterprise level. These agreements are enforceable and legally binding and specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions, and the approximate timing of the actions under the contracts. For the six months ended July 31, 2025, there were no material changes outside of the ordinary course of business in our commitments and contractual obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025, which was filed with the SEC on March 21, 2025. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

Current wording

Our primary sources of cash are payments received from our customers as well as net proceeds from the issuance of our convertible senior notes. Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses (including those related to GPUs), sales and marketing expenses, overhead costs, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our authorized stock repurchase program. As of October 31, 2025, our material cash requirements from known contractual obligations and commitments relate primarily to (i) third-party cloud infrastructure agreements, (ii) our convertible senior notes, (iii) operating leases for office facilities, and (iv) subscription arrangements used to facilitate our operations at the enterprise level. These agreements are enforceable and legally binding and specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions, and the approximate timing of the actions under the contracts. For the nine months ended October 31, 2025, there were no material changes outside of the ordinary course of business in our commitments and contractual obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025, which was filed with the SEC on March 21, 2025. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

Previous wording

During the three months ended April 30, 2025, we repurchased 3.2 million shares of our outstanding common stock for an aggregate purchase price of $490.6 million, excluding transaction costs associated with the repurchases, at a weighted-average price of $152.63 per share. All repurchases were made in open market transactions. There were no shares repurchased under our authorized stock repurchase program during the three months ended July 31, 2025. As of July 31, 2025, $1.5 billion remained available for future repurchases under the stock repurchase program (exclusive of transaction costs associated with repurchases). See Note 12, “Equity,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

Current wording

During the nine months ended October 31, 2025, we repurchased 4.3 million shares of our outstanding common stock for an aggregate purchase price of $723.5 million, excluding transaction costs associated with the repurchases, at a weighted-average price of $169.95 per share. All repurchases were made in open market transactions. As of October 31, 2025, approximately $1.3 billion remained available for future repurchases under the stock repurchase program (exclusive of transaction costs associated with repurchases). See Note 12, “Equity,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

Previous wording

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

Current wording

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

Previous wording

For the six months ended July 31, 2025, net cash provided by operating activities was $303.3 million, consisting of our net loss of $727.9 million, adjusted for non-cash charges of $1.1 billion, and net cash outflows of $76.8 million resulting from changes in our operating assets and liabilities. The main driver of the changes in operating assets and liabilities during the six months ended July 31, 2025 was (i) a $323.9 million decrease in deferred revenue due to revenue recognition outpacing invoicing for prepaid capacity agreements, (ii) an $84.9 million increase in deferred commissions primarily earned upon the origination, expansion, or renewal of customer contracts, (iii) a $26.4 million decrease in operating lease liabilities due to payments related to our operating lease obligations. and (iv) a $22.3 million increase in prepaid expenses and other assets primarily attributable to balances due from the brokerage firm related to employee stock transactions, partially offset by (a) a $276.1 million decrease in accounts receivable due to timing of billings and collections as we have historically received a higher volume of customer orders in the fourth fiscal quarter of each year, and (b) a $97.2 million increase in accrued expenses and other liabilities primarily due to the timing of accruals and payments.

Current wording

For the nine months ended October 31, 2025, net cash provided by operating activities was $440.8 million, consisting of our net loss of approximately $1.0 billion, adjusted for non-cash charges of approximately $1.6 billion, and net cash outflows of $157.5 million resulting from changes in our operating assets and liabilities, net of the effects of a business combination. The main driver of the changes in operating assets and liabilities during the nine months ended October 31, 2025 was (i) a $181.7 million increase in deferred commissions primarily earned upon the origination, expansion, or renewal of customer contracts, (ii) a $172.4 million decrease in deferred revenue due to revenue recognition outpacing invoicing for prepaid capacity agreements, (iii) a $42.4 million decrease in operating lease liabilities due to payments related to our operating lease obligations, (iv) a $12.6 million increase in accounts receivable primarily due to growth in our business, partially offset by (a) a $217.8 million increase in accrued expenses and other liabilities primarily due to the timing of accruals and payments and growth in our business, and (b) a $36.3 million increase in accounts payable due to timing of invoices and payments.

Previous wording

For the six months ended July 31, 2024, net cash provided by operating activities was $425.3 million, consisting of our net loss of $635.6 million, adjusted for non-cash charges of $850.8 million, and net cash inflows of $210.1 million provided by changes in our operating assets and liabilities.

Current wording

For the nine months ended October 31, 2024, net cash provided by operating activities was $527.0 million, consisting of our net loss of $963.5 million, adjusted for non-cash charges of $1.3 billion, and net cash inflows of $188.8 million provided by changes in our operating assets and liabilities, net of the effects of business combinations.

Previous wording

Net cash provided by operating activities decreased $122.0 million for the six months ended July 31, 2025, compared to the six months ended July 31, 2024, primarily due to higher cash expenditures to support business growth and the timing of payments and collections, partially offset by increased cash collections from customers driven by higher sales. We expect to continue to generate positive net cash flows from operating activities for fiscal 2026.

Current wording

Net cash provided by operating activities decreased $86.3 million for the nine months ended October 31, 2025, compared to the nine months ended October 31, 2024, primarily due to higher cash expenditures to support business growth and the timing of payments and collections, partially offset by increased cash collections from customers driven by higher sales. We expect to continue to generate positive net cash flows from operating activities for fiscal 2026.