Leases

9 Months Ended

Oct. 31, 2019

Leases [Abstract]

Leases

Leases

We have operating and finance leases for corporate offices, data centers, and certain equipment. Our leases have various expiration dates through 2029, some of which include options to extend the leases for up to nine years. Additionally, we are the sublessor for certain office space. Our sublease income for the three and nine months ended October 31, 2019 was immaterial.

Lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. We use an estimate of our discount rate based on the information available at the lease commencement date in determining the present value of lease payments, unless the implicit rate is readily determinable. For leases which commenced prior to our adoption of Topic 842, we used the discount rate on February 1, 2019. The lease right-of-use assets also include any lease payments made and exclude lease incentives such as tenant improvement allowances. Options to extend the lease term are included in the lease term when it is reasonably certain that we will exercise the extension option.

Our operating leases typically include non-lease components such as common-area maintenance costs. We have elected to exclude non-lease components from lease payments for the purpose of calculating lease right-of-use assets and liabilities. Non-lease components that are not fixed are expensed as incurred as variable lease payments.

Leases with a term of one year or less are not recognized on our consolidated balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.

For the three and nine months ended October 31, 2019, our operating lease expense was $1.8 million and $5.0 million, respectively. Our finance lease expense was immaterial and $1.0 million for the three and nine months ended October 31, 2019, respectively.

Supplemental cash flow information related to leases was as follows (in thousands):

	Nine months ended October 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,131
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	11,656

 

Supplemental balance sheet information related to leases was as follows (in thousands, except lease term and discount rate):

	As of October 31, 2019
Operating Leases
Lease right-of-use-assets	$	24,055
Lease liabilities	$	6,401
Lease liabilities, noncurrent	19,261
Total operating lease liabilities	$	25,662
Finance Leases
Property and equipment, at cost	$	1,738
Accumulated depreciation	(978		)
Property and equipment, net	$	760
Lease liabilities	$	1,029
Lease liabilities, noncurrent	621
Total finance lease liabilities	$	1,650
Weighted Average Remaining Lease Term
Operating leases	5.2 years
Finance leases	1.6 years
Weighted Average Discount Rate
Operating leases	4.3		%
Finance leases	4.3		%

 

Maturities of lease liabilities were as follows (in thousands):

Period	Operating leases			Finance leases
Remaining for Fiscal 2020	$	1,787		$	269
Fiscal 2021	7,178			1,076
Fiscal 2022	6,109			359
Fiscal 2023	4,119			—
Fiscal 2024	3,208			—
Thereafter	6,365			—
Total lease payments	28,766			1,704
Less imputed interest	(3,104		)	(54		)
Total	$	25,662		$	1,650

Future minimum lease payments under non-cancelable operating leases as of January 31, 2019 under ASC 840 were as follows (in thousands):

Period	Operating leases
Fiscal 2020	$	5,079
Fiscal 2021	4,843
Fiscal 2022	4,063
Fiscal 2023	2,534
Fiscal 2024	1,884
Thereafter	1,495
Total	$	19,898

 

As of October 31, 2019, we have additional operating leases, primarily for office leases, that have not yet commenced of $3.3 million. These operating leases will commence during the fiscal year ending January 31, 2021 with lease terms of less than one year to five years.

Leases

Leases

We have operating and finance leases for corporate offices, data centers, and certain equipment. Our leases have various expiration dates through 2029, some of which include options to extend the leases for up to nine years. Additionally, we are the sublessor for certain office space. Our sublease income for the three and nine months ended October 31, 2019 was immaterial.

Lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. We use an estimate of our discount rate based on the information available at the lease commencement date in determining the present value of lease payments, unless the implicit rate is readily determinable. For leases which commenced prior to our adoption of Topic 842, we used the discount rate on February 1, 2019. The lease right-of-use assets also include any lease payments made and exclude lease incentives such as tenant improvement allowances. Options to extend the lease term are included in the lease term when it is reasonably certain that we will exercise the extension option.

Our operating leases typically include non-lease components such as common-area maintenance costs. We have elected to exclude non-lease components from lease payments for the purpose of calculating lease right-of-use assets and liabilities. Non-lease components that are not fixed are expensed as incurred as variable lease payments.

Leases with a term of one year or less are not recognized on our consolidated balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.

For the three and nine months ended October 31, 2019, our operating lease expense was $1.8 million and $5.0 million, respectively. Our finance lease expense was immaterial and $1.0 million for the three and nine months ended October 31, 2019, respectively.

Supplemental cash flow information related to leases was as follows (in thousands):

	Nine months ended October 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,131
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	11,656

 

Supplemental balance sheet information related to leases was as follows (in thousands, except lease term and discount rate):

	As of October 31, 2019
Operating Leases
Lease right-of-use-assets	$	24,055
Lease liabilities	$	6,401
Lease liabilities, noncurrent	19,261
Total operating lease liabilities	$	25,662
Finance Leases
Property and equipment, at cost	$	1,738
Accumulated depreciation	(978		)
Property and equipment, net	$	760
Lease liabilities	$	1,029
Lease liabilities, noncurrent	621
Total finance lease liabilities	$	1,650
Weighted Average Remaining Lease Term
Operating leases	5.2 years
Finance leases	1.6 years
Weighted Average Discount Rate
Operating leases	4.3		%
Finance leases	4.3		%

 

Maturities of lease liabilities were as follows (in thousands):

Period	Operating leases			Finance leases
Remaining for Fiscal 2020	$	1,787		$	269
Fiscal 2021	7,178			1,076
Fiscal 2022	6,109			359
Fiscal 2023	4,119			—
Fiscal 2024	3,208			—
Thereafter	6,365			—
Total lease payments	28,766			1,704
Less imputed interest	(3,104		)	(54		)
Total	$	25,662		$	1,650

Future minimum lease payments under non-cancelable operating leases as of January 31, 2019 under ASC 840 were as follows (in thousands):

Period	Operating leases
Fiscal 2020	$	5,079
Fiscal 2021	4,843
Fiscal 2022	4,063
Fiscal 2023	2,534
Fiscal 2024	1,884
Thereafter	1,495
Total	$	19,898

 

As of October 31, 2019, we have additional operating leases, primarily for office leases, that have not yet commenced of $3.3 million. These operating leases will commence during the fiscal year ending January 31, 2021 with lease terms of less than one year to five years.