Financial Analysis

Note 4 Business Combinations and Intangible Assets In June 2026, the Company completed two immaterial acquisitions for aggregate purchase consideration of $27.2 million and accounted for them as business combinations from the respective dates of acquisition. $3.8 million of the purchase consideration was allocated to intangible assets and $23.6 million was allocated to goodwill. The remaining assets acquired and liabilities assumed on the acquisition date were not material. Acquired intangible assets are as follows (in thousands): July 31, 2026 Gross Accumulated Amortization Net Acquired technology $ 32,441 $ (18,833) $ 13,608 Total $ 32,441 $ (18,833) $ 13,608 January 31, 2026 Gross Accumulated Amortization Net Acquired technology $ 28,641 $ (12,838) $ 15,803 Total $ 28,641 $ (12,838) $ 15,803 The Company recognized $3.2 million and $1.2 million in amortization expense related to acquired intangible assets for the three months ended July 31, 2026 and 2025, respectively, and $6.0 million and $2.2 million in amortization expense related to acquired intangible assets for the six months ended July 31, 2026 and 2025, respectively. The following table summarizes the estimated future amortization expense of the acquired intangible assets as of July 31, 2026 (in thousands): Fiscal year Amount Remainder of 2027 $ 5,075 2028 6,413 2029 2,120 Total $ 13,608 …

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Note 8 Commitments and Contingencies Purchase Commitments As of July 31, 2026, there were no significant changes outside the ordinary course of business to the Company's commitments and purchase obligations since January 31, 2026. Litigation From time to time, the Company receives inquiries and/or claims or is involved in legal disputes and/or matters. In the opinion of management, any liabilities resulting from these claims will not have a material adverse effect on the Companys results of operations, financial position, and cash flows. Warranties and Indemnifications The Company provides to qualifying customers a services warranty program for recovery of certain expenses related to data recovery and restoration in the event that data backed up using the Companys solutions cannot be recovered following a ransomware attack. To date, costs relating to the warranty program have not been material. The Company typically provides indemnification to customers for certain losses suffered or expenses incurred as a result of third-party claims arising from the Companys infringement of a third-partys intellectual property. Certain of these indemnification provisions survive termination or the expiration of the applicable agreement. The Company has not incurred a material liability relating to these indemnification provisions, and therefore, has not recorded a liability during any period for these indemnification provisions. …

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Note 7 Debt Convertible Notes In June 2025, the Company issued $1.15 billion aggregate principal amount of 0.00% convertible senior notes due 2030 (the Convertible Notes or Notes). Refer to Note 8, Debt of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, for additional information on the Convertible Notes. As of July 31, 2026, the conditions allowing holders of the Convertible Notes to convert have not been met. The net carrying amount of the Convertible Notes was as follows (in thousands): July 31, 2026 Principal $ 1,150,000 Unamortized debt discount and issuance costs (17,105) Net carrying amount $ 1,132,895 For each of the three and six months ended July 31, 2026, amortization of debt discount and issuance costs was $1.1 million and $2.2 million, respectively. For each of the three and six months ended July 31, 2025, amortization of debt discount and issuance costs was $0.6 million. The debt discount and issuance costs are being amortized into interest expense on the unaudited condensed consolidated statements of operations over the term of the Convertible Notes at an effective interest rate of 0.19%. Capped Calls In connection with the pricing of the Convertible Notes and the exercise in full by the initial purchasers of their option to purchase additional Convertible Notes, the Company entered into capped call transactions (the Capped Calls) with certain affiliates of certain initial purchasers of the Convertible Notes and other financial instit …

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Timing of revenue recognition (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Subscription revenue Products and services transferred over time $ 387,787 $ 273,429 $ 743,427 $ 517,420 Products and services transferred at a point in time 19,369 23,528 37,882 45,198 Other revenue Products and services transferred over time 10,465 11,189 21,624 22,263 Products and services transferred at a point in time 9,639 1,714 11,395 3,460 Total revenue $ 427,260 $ 309,860 $ 814,328 $ 588,341 The following table sets forth revenue by geographic area based on ship to address (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Americas $ 298,583 $ 225,290 $ 577,496 $ 428,055 EMEA 105,801 73,037 197,989 137,797 APAC 22,876 11,533 38,843 22,489 Total revenue $ 427,260 $ 309,860 $ 814,328 $ 588,341

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Note 5 Fair Value of Financial Instruments The Company classifies its financial instruments within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. Three levels of input may be used to measure fair value: Level 1 Observable inputs are unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Observable inputs are quoted for similar assets and liabilities in active markets or inputs other than quoted prices which are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments. Level 3 Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. These inputs will be based on the Companys own assumptions and will require significant management judgment or estimation. The Company did not have any level 3 investments as of July 31, 2026 and January 31, 2026. The following table summarizes the Companys cash and available-for-sale marketable securities amortized cost, gross unrealized gains, gross unrealized losses, and estimated fair value by significant investment category reported as cash and cash equivalents or short-term investments (in thousands): Reported as July 31, 2026 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Cash and Cash Equivalents Short-Term Investments Cash: …

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Note 11 Income Taxes The Company recorded an income tax expense of $5.5 million and $1.8 million for the three months ended July 31, 2026 and 2025, respectively, and $10.1 million and $3.1 million for the six months ended July 31, 2026 and 2025, respectively. For the three months ended July 31, 2026 and 2025, the income tax provision consisted of taxes on the income of the Company's foreign subsidiaries, foreign withholding taxes, and U.S. state taxes, partially offset by excess benefits from stock-based compensation deductions in the UK. For the six months ended July 31, 2026 and 2025, the income tax provision consisted of taxes on the income of the Company's foreign subsidiaries, foreign withholding taxes, and U.S. state taxes, partially offset by excess benefits from stock-based compensation deductions in the UK. As of July 31, 2026, the Company maintained a full valuation allowance on its U.S. federal and state net deferred tax assets as it was more likely than not that those deferred tax assets will not be realized. …

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Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In July 2025, the FASB issued ASU 2025-05, Financial Instruments Credit Losses, which provides a practical expedient for estimating expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under Topic 606, Revenue from Contracts with Customers. The Company adopted ASU 2025-05 effective February 1, 2026 on a prospective basis and elected the practical expedient. The adoption did not have a material impact on the Companys unaudited condensed consolidated financial statements and related disclosures. Recently Announced Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures, which requires entities to provide disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, on either a prospective or retrospective basis, with early adoption permitted. The Company is assessing the impact of adopting this standard. In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software: Targeted Improvements to the Accounting for Internal-Use Software, w …

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Note 3 Revenue by Geography The geographic regions are the Americas, EMEA (Europe, the Middle East, and Africa) and APAC (Asia Pacific). The following table sets forth revenue by geographic area based on ship to address (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Americas $ 298,583 $ 225,290 $ 577,496 $ 428,055 EMEA 105,801 73,037 197,989 137,797 APAC 22,876 11,533 38,843 22,489 Total revenue $ 427,260 $ 309,860 $ 814,328 $ 588,341 For the three months ended July 31, 2026 and 2025, United States accounted for $287.5 million and $216.6 million, respectively, or 67% and 70%, respectively, of consolidated total revenue. For the six months ended July 31, 2026 and 2025, United States accounted for $555.7 million and $411.9 million, respectively, or 68% and 70%, respectively, of consolidated total revenue. …

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Note 12 Segment Reporting The Company has one reportable segment which is software and services. The software and services segment provides unified data security solutions to customers primarily under SaaS arrangements. The Company manages the business activities on a consolidated basis. The technology used in the customer arrangements is primarily based on a single software platform that is deployed to and implemented by customers in a similar manner. The types of software and services from which the Company generates revenue are described under the Revenue Recognition policy within the Note 2, Basis of Presentation and Summary of Significant Accounting Policies. The Companys chief operating decision maker is its chief executive officer. The chief operating decision maker assesses performance for the software and services segment and decides how to allocate resources based on net loss that is also reported on the consolidated statements of operations as consolidated net loss. The chief operating decision maker does not use any segment assets measure to assess performance and decide how to allocate resources. The chief operating decision maker uses net loss and the functional areas as a percentage of revenue to evaluate and decide where to invest within the software and services segment. Net loss is used to monitor budget versus actual results. The chief operating decision maker also uses net loss in competitive analysis by benchmarking to the Companys competitors. The compet …

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Note 9 Stockholders Deficit Equity Incentive Plan The Company has reserved shares of its common stock for future issuance as follows (in thousands): July 31, January 31, 2026 2026 2014 Stock Option and Grant Plan: Outstanding stock options 8,657 8,970 Outstanding restricted stock units 5,094 9,227 2024 Equity Incentive Plan: Outstanding restricted stock units 16,583 12,294 Shares available for future issuance under the 2024 Plan 64,254 58,406 2024 Employee Stock Purchase Plan 6,571 5,090 Total shares of common stock reserved 101,159 93,987 Stock Options Options issued under the Companys 2014 Plan and 2024 Plan generally are exercisable for periods not to exceed ten years and generally vest over four years with 25% vesting after one year and the remainder vesting monthly thereafter in equal installments. A summary of the stock option activity and related information is as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding as of January 31, 2026 8,970,353 $ 29.20 7.6 $ 239,954 Granted Exercised (312,727) 4.85 19,123 Cancelled (500) 7.99 Outstanding as of July 31, 2026 8,657,126 $ 30.08 7.3 $ 366,013 Vested and exercisable as of July 31, 2026 3,656,764 $ 27.46 6.7 $ 164,195 There were no options granted during the six months ended July 31, 2026 and 2025. The intrinsic value of the options exercised represents the difference between the estimated fair market value of …

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