Leases

6 Months Ended

Jul. 31, 2023

Note 5. Leases

We have entered into various non-cancellable operating lease agreements for certain of our offices and data centers with lease periods expiring primarily between fiscal years 2024 and 2034. Certain of these arrangements have free or escalating rent payment provisions and optional renewal or termination clauses. Our operating leases typically include variable lease payments, which are primarily comprised of common area maintenance and utility charges for our offices and power and network connections for our data centers, that are determined based on actual consumption. Our operating lease agreements do not contain any residual value guarantees, covenants, or other restrictions.

We also entered into various finance lease arrangements to obtain servers and related equipment for our data center operations. These agreements are primarily for four years and certain of these arrangements have optional renewal or termination clauses. The leases are secured by the underlying leased servers and related equipment.

We sublease certain floors of our Redwood City and London offices. Our current subleases have total lease terms ranging from 30 to 96 months that will expire at various dates by fiscal year 2026.

The components of lease cost, which were included in operating expenses in our condensed consolidated statements of operations, were as follows (in thousands):


	Three Months Ended						Six Months Ended
	July 31,						July 31,
	2023			2022			2022			2021
Finance lease cost:
Amortization of finance lease right-of-use assets	$	5,287		$	11,502		$	11,815		$	23,463
Interest on finance lease liabilities		271			547			627			1,213
Operating lease cost, gross		12,218			12,542			25,393			25,131
Variable lease cost, gross		2,344			2,009			4,654			4,001
Sublease income		(1,704	)		(2,317	)		(3,373	)		(4,573	)
Total lease cost	$	18,416		$	24,283		$	39,116		$	49,235

As of July 31, 2023, maturities of our operating and finance lease liabilities, which do not include short-term leases and variable lease payments, are as follows (in thousands):


Years ending January 31:	Operating Leases (1)			Finance Leases
2024	$	26,802		$	11,014
2025		36,492			2,525
2026		33,192			—
2027		32,179			—
2028		28,001			—
Thereafter		22,798			—
Total lease payments	$	179,464		$	13,539
Less: imputed interest	$	(23,094	)	$	(236	)
Present value of total lease liabilities	$	156,370		$	13,303

(1) Non-cancellable sublease proceeds for the remainder of the year ending January 31, 2024 and years ending January 31, 2025 and 2026 of $3.2 million, $7.0 million, and $1.0 million, respectively, are not included in the table above.

As of July 31, 2023, we had one operating lease for an office space that has not yet commenced. This operating lease has aggregated undiscounted future payments of $20.1 million and a lease term of nine years. This operating lease will commence during fiscal year 2025. We did not have any finance leases that had not yet commenced as of July 31, 2023.