September 7, 2023 - 10-Q: Quarterly report pursuant to Section 13 or 15(d)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

___________________________________________

FORM 10-Q

___________________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number: 001-40348

___________________________________________

UiPath, Inc.

(Exact Name of Registrant as Specified in its Charter)

___________________________________________


Delaware			47-4333187
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
One Vanderbilt Avenue, 60th Floor New York, New York			10017
(Address of principal executive offices)			(Zip Code)
Registrant’s telephone number, including area code: (844) 432-0455

___________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Class A common stock, par value
$0.00001 per share

PATH

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of September 5, 2023, the registrant had 484,285,345 shares of Class A common stock and 82,452,748 shares of Class B common stock, each with a par value of $0.00001 per share, outstanding.

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		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Comprehensive Loss	3
	Condensed Consolidated Statements of Stockholders’ Equity	4
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	40
Item 3.	Defaults Upon Senior Securities	40
Item 4.	Mine Safety Disclosures	40
Item 5.	Other Information	40
Item 6.	Exhibits	41
Signatures		42

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), about UiPath, Inc. and its consolidated subsidiaries (“UiPath,” the “Company,” “we,” “us,” or “our”) and our industry that involve substantial risks and uncertainties. All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations or financial condition, business strategy, and plans and objectives of management for future operations, are forward-looking statements. In some cases, forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would,” or the negative of these words or other similar terms or expressions. These forward-looking statements include, but are not limited to, statements concerning the following:

•our expectations regarding our annualized renewal run-rate ("ARR"), revenue, expenses, and other operating results;

•our ability to acquire new customers and successfully retain existing customers;

•our ability to increase the number of users who access our platform and the number of automations built on our platform;

•our ability to effectively manage our growth and achieve or maintain profitability;

•future investments in our business, our anticipated capital expenditures, and our estimates regarding our capital requirements;

•the costs and success of our marketing efforts and our ability to evolve and enhance our brand;

•our growth strategies;

•the estimated addressable market opportunity for our platform and for automation in general;

•our reliance on key personnel and our ability to attract, integrate, and retain highly-qualified personnel and execute management transitions;

•our ability to obtain, maintain, and enforce our intellectual property rights and any costs associated therewith;

•the effect of global events, such as the Russian military operation in Ukraine, on our business, industry, and the global economy;

•our ability to compete effectively with existing competitors and new market entrants; and

•the size and growth rates of the markets in which we compete.

These forward-looking statements should not be unduly relied upon or regarded as predictions of future events. The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors described in the section titled "Risk Factors" and elsewhere in this Quarterly Report on Form 10-Q, and in the section titled "Risk Factors" and elsewhere in our Annual Report on Form 10-K for the fiscal year ended January 31, 2023 filed with the Securities and Exchange Commission ("SEC") on March 24, 2023 (the "2023 Form 10-K"). Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. The results, events, and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject, based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe such information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. Such statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by

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law. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments.

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited).

UiPath, Inc.

Condensed Consolidated Balance Sheets

Amounts in thousands except per share data

(unaudited)


	As of
	July 31, 2023		January 31, 2023
ASSETS
Current assets
Cash and cash equivalents	$	1,093,898	$	1,402,119
Restricted cash	400		—
Marketable securities	735,670		354,774
Accounts receivable, net of allowance for credit losses of $1,128 and $2,698, respectively	226,327		374,217
Contract assets	80,602		69,260
Deferred contract acquisition costs	59,326		49,887
Prepaid expenses and other current assets	107,373		94,150
Total current assets	2,303,596		2,344,407
Marketable securities, non-current	—		2,942
Contract assets, non-current	5,021		6,523
Deferred contract acquisition costs, non-current	134,021		137,616
Property and equipment, net	24,679		29,045
Operating lease right-of-use assets	52,847		52,052
Intangible assets, net	19,244		23,010
Goodwill	90,051		88,010
Deferred tax asset	5,573		5,895
Other assets, non-current	35,108		45,706
Total assets	$	2,670,140	$	2,735,206
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	1,887	$	8,891
Accrued expenses and other current liabilities	64,404		76,645
Accrued compensation and employee benefits	67,836		142,582
Deferred revenue	384,015		398,334
Total current liabilities	518,142		626,452
Deferred revenue, non-current	103,780		121,697
Operating lease liabilities, non-current	56,699		56,442
Other liabilities, non-current	8,153		10,457
Total liabilities	686,774		815,048
Commitments and contingencies (Note 11)
Stockholders' equity
Preferred stock, $0.00001 par value per share, 20,000 shares authorized as of July 31, 2023 and January 31, 2023; 0 shares issued and outstanding as of July 31, 2023 and January 31, 2023	—		—
Class A common stock, $0.00001 par value per share, 2,000,000 shares authorized as of July 31, 2023 and January 31, 2023; 484,128 and 474,160 shares issued and outstanding as of July 31, 2023 and January 31, 2023, respectively	5		5
Class B common stock, $0.00001 par value per share, 115,741 shares authorized as of July 31, 2023 and January 31, 2023; 82,453 shares issued and outstanding as of July 31, 2023 and January 31, 2023	1		1
Additional paid-in capital	3,888,414		3,736,838
Accumulated other comprehensive income	11,506		7,612
Accumulated deficit	(1,916,560)		(1,824,298)
Total stockholders’ equity	1,983,366		1,920,158
Total liabilities and stockholders’ equity	$	2,670,140	$	2,735,206

The accompanying notes are an integral part of these condensed consolidated financial statements.

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UiPath, Inc.

Condensed Consolidated Statements of Operations

Amounts in thousands except per share data

(unaudited)


	Three Months Ended July 31,				Six Months Ended July 31,
	2023		2022		2023		2022
Revenue:
Licenses	$	119,300	$	103,696	$	253,339	$	220,700
Subscription services	159,999		124,656		306,351		240,150
Professional services and other	8,011		13,870		17,208		26,438
Total revenue	287,310		242,222		576,898		487,288
Cost of revenue:
Licenses	3,008		2,170		5,555		4,707
Subscription services	26,777		22,326		49,855		43,371
Professional services and other	19,202		20,080		37,244		41,514
Total cost of revenue	48,987		44,576		92,654		89,592
Gross profit	238,323		197,646		484,244		397,696
Operating expenses:
Sales and marketing	169,725		181,547		330,131		371,329
Research and development	86,606		67,849		161,948		136,539
General and administrative	59,577		68,443		116,161		125,973
Total operating expenses	315,908		317,839		608,240		633,841
Operating loss	(77,585)		(120,193)		(123,996)		(236,145)
Interest income	13,582		4,505		27,430		5,496
Other income (expense), net	7,472		(600)		11,766		(3,411)
Loss before income taxes	(56,531)		(116,288)		(84,800)		(234,060)
Provision for income taxes	3,830		4,090		7,462		8,879
Net loss	$	(60,361)	$	(120,378)	$	(92,262)	$	(242,939)


Net loss per share attributable to common stockholders, basic and diluted	$	(0.11)	$	(0.22)	$	(0.16)	$	(0.45)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted	562,883		546,058		560,422		544,014

The accompanying notes are an integral part of these condensed consolidated financial statements.

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UiPath, Inc.

Condensed Consolidated Statements of Comprehensive Loss

Amounts in thousands

(unaudited)


	Three Months Ended July 31,				Six Months Ended July 31,
	2023		2022		2023		2022
Net loss	$	(60,361)	$	(120,378)	$	(92,262)	$	(242,939)
Other comprehensive income (loss), net of tax:
Unrealized (loss) gain on available-for-sale marketable securities, net	(161)		159		(18)		(301)
Foreign currency translation adjustments	1,593		550		3,912		552
Other comprehensive income, net	1,432		709		3,894		251
Comprehensive loss	$	(58,929)	$	(119,669)	$	(88,368)	$	(242,688)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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UiPath, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

Amounts in thousands

(unaudited)


		Common Stock						Additional Paid-in Capital		Accumulated Other Comprehensive Income		Accumulated Deficit		Total Stockholders’ Equity
	Class A			Class B
			Shares		Amount		Shares	Amount		Amount		Amount		Amount		Amount
Balance as of January 31, 2023			474,160		$	5	82,453	$	1	$	3,736,838	$	7,612	$	(1,824,298)	$	1,920,158
Issuance of common stock upon exercise of stock options			898		—		—	—		1,175		—		—		1,175

Issuance of common stock upon settlement of restricted stock units			4,246		—		—	—		—		—		—		—
Tax withholdings on settlement of restricted stock units			(1,463)		—		—	—		(25,697)		—		—		(25,697)
Charitable donation of Class A common stock			281		—		—	—		4,215		—		—		4,215
Stock-based compensation			—		—		—	—		85,125		—		—		85,125
Other comprehensive income, net			—		—		—	—		—		2,462		—		2,462
Net loss			—		—		—	—		—		—		(31,901)		(31,901)
Balance as of April 30, 2023			478,122		$	5	82,453	$	1	$	3,801,656	$	10,074	$	(1,856,199)	$	1,955,537
Issuance of common stock upon exercise of stock options			1,824		—		—	—		2,717		—		—		2,717

Issuance of common stock upon settlement of restricted stock units			5,026		—		—	—		—		—		—		—
Tax withholdings on settlement of restricted stock units			(1,676)		—		—	—		(27,420)		—		—		(27,420)
Issuance of common stock under employee stock purchase plan			832		—		—	—		9,313		—		—		9,313
Stock-based compensation			—		—		—	—		102,148		—		—		102,148
Other comprehensive income, net			—		—		—	—		—		1,432		—		1,432
Net loss			—		—		—	—		—		—		(60,361)		(60,361)
Balance as of July 31, 2023			484,128		$	5	82,453	$	1	$	3,888,414	$	11,506	$	(1,916,560)	$	1,983,366

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		Common Stock						Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Stockholders’ Equity
	Class A			Class B
			Shares		Amount		Shares	Amount		Amount		Amount		Amount		Amount
Balance as of January 31, 2022			458,773		$	4	82,453	$	1	$	3,406,959	$	10,899	$	(1,495,946)	$	1,921,917
Issuance of common stock upon exercise of stock options			1,283		—		—	—		2,683		—		—		2,683
Vesting of early exercised stock options			—		—		—	—		1,355		—		—		1,355
Issuance of common stock upon settlement of restricted stock units			3,499		—		—	—		—		—		—		—
Tax withholdings on settlement of restricted stock units			(1,125)		—		—	—		(24,827)		—		—		(24,827)
Stock-based compensation			—		—		—	—		102,085		—		—		102,085
Other comprehensive loss, net			—		—		—	—		—		(458)		—		(458)
Net loss			—		—		—	—		—		—		(122,561)		(122,561)
Balance as of April 30, 2022			462,430		$	4	82,453	$	1	$	3,488,255	$	10,441	$	(1,618,507)	$	1,880,194
Issuance of common stock upon exercise of stock options			1,418		—		—	—		1,878		—		—		1,878

Issuance of common stock upon settlement of restricted stock units			3,183		1		—	—		—		—		—		1
Tax withholdings on settlement of restricted stock units			(1,040)		—		—	—		(18,922)		—		—		(18,922)
Charitable donation of Class A common stock			300		—		—	—		5,499		—		—		5,499
Shares issued in connection with business acquisition			570		—		—	—		2,965		—		—		2,965
Issuance of common stock under employee stock purchase plan			578		—		—	—		9,070		—		—		9,070
Repurchase of unvested early exercised stock options			(441)		—		—	—		—		—		—		—
Stock-based compensation			—		—		—	—		88,533		—		—		88,533
Other comprehensive income, net of tax			—		—		—	—		—		709		—		709
Net loss			—		—		—	—		—		—		(120,378)		(120,378)
Balance as of July 31, 2022			466,998		$	5	82,453	$	1	$	3,577,278	$	11,150	$	(1,738,885)	$	1,849,549

The accompanying notes are an integral part of these condensed consolidated financial statements.

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UiPath, Inc.

Condensed Consolidated Statements of Cash Flows

Amounts in thousands

(unaudited)


	Six Months Ended July 31,
	2023		2022
Cash flows from operating activities
Net loss	$	(92,262)	$	(242,939)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	11,160		8,065
Amortization of deferred contract acquisition costs	31,229		21,860
Net amortization on marketable securities	(10,745)		860
Stock-based compensation expense	187,145		189,706
Charitable donation of Class A common stock	4,215		5,499
Amortization of operating lease right-of-use assets	6,299		4,597
Provision for deferred income taxes	(57)		1,505
Abandonment and impairment charges	—		2,881
Other non-cash charges (credits), net	965		(1,031)
Changes in operating assets and liabilities:
Accounts receivable	147,725		51,707
Contract assets	(9,455)		(26,146)
Deferred contract acquisition costs	(36,389)		(39,572)
Prepaid expenses and other assets	(6,679)		(4,277)
Accounts payable	(6,033)		2,759
Accrued expenses and other liabilities	(4,229)		(14,507)
Accrued compensation and employee benefits	(74,184)		(45,042)
Operating lease liabilities, net	(7,532)		(2,422)
Deferred revenue	(29,547)		9,876
Net cash provided by (used in) operating activities	111,626		(76,621)
Cash flows from investing activities
Purchases of marketable securities	(709,199)		(45,600)

Maturities of marketable securities	338,644		47,433
Purchases of property and equipment	(2,876)		(16,298)
Payments related to business acquisitions, net of cash acquired	—		(29,477)
Other investing, net	2,754		(507)
Net cash used in investing activities	(370,677)		(44,449)
Cash flows from financing activities
Proceeds from exercise of stock options	3,904		4,682
Payments of tax withholdings on net settlement of equity awards	(52,832)		(38,717)
Net payments of tax withholdings on sell-to-cover equity award transactions	(679)		(10,132)
Proceeds from employee stock purchase plan contributions	9,643		8,507
Payment of deferred consideration related to business acquisition	(5,863)		—
Repurchase of unvested early exercised stock options	—		(1,493)
Net cash used in financing activities	(45,827)		(37,153)
Effect of exchange rate changes	(2,943)		(3,144)
Net decrease in cash, cash equivalents, and restricted cash	(307,821)		(161,367)
Cash, cash equivalents and restricted cash - beginning of period	1,402,119		1,768,723
Cash, cash equivalents and restricted cash - end of period	$	1,094,298	$	1,607,356
Supplemental disclosure of cash flow information
Cash paid for interest	$	413	$	527
Cash paid for income taxes	7,234		17,610
Supplemental disclosure of non-cash investing and financing activities
Reduction in accrued expenses and other liabilities for vesting of early exercised stock options	—		1,355
Value of shares issued in payment of business acquisitions	—		2,965
Payable for marketable securities purchase	—		3,638


Loan notes issued in connection with business acquisitions	—		11,433
Tax withholdings on net settlement of restricted stock units, accrued but not yet paid	2,466		5,129

The accompanying notes are an integral part of these consolidated financial statements.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements

(unaudited)

1. Organization and Description of Business

Description of Business

UiPath, Inc. (the “Company,” “we,” “us,” or “our”) was incorporated in Delaware in June 2015 and is headquartered in New York, New York. Our AI-powered UiPath Business Automation Platform offers a robust set of capabilities that allows our customers to discover opportunities for automation, automate using a digital workforce that seamlessly collaborates with humans, and operate a mission critical automation program at scale.

2. Summary of Significant Accounting Policies

Our significant accounting policies are discussed in greater scope and detail in Note 2, Summary of Significant Accounting Policies, in the notes to consolidated financial statements included in the 2023 Form 10-K. There have been no significant changes to such policies during the six months ended July 31, 2023.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable regulations of the SEC regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP may be condensed or omitted. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the accompanying notes thereto for the fiscal year ended January 31, 2023, which are included in the 2023 Form 10-K.

The unaudited condensed consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, that are necessary for the fair presentation of our financial information. The unaudited condensed consolidated financial statements include the financial statements of UiPath, Inc. and its subsidiaries in which we hold a controlling financial interest. Intercompany transactions and accounts have been eliminated in consolidation.

The results of operations for the six months ended July 31, 2023 are not necessarily indicative of the results to be expected for the fiscal year ending January 31, 2024 or for any other future interim or annual period.

Fiscal Year

Our fiscal year ends on January 31. References to fiscal year 2024, for example, refer to the fiscal year ending January 31, 2024.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities at the balance sheet date and the amounts of revenue and expenses reported during the period. We evaluate estimates based on historical and anticipated results, trends, and various other assumptions. Such estimates include, but are not limited to, certain aspects of revenue recognition including changes in variable consideration, expected period of benefit for deferred contract acquisition costs, allowance for credit losses, fair value of financial assets and liabilities, fair value of acquired assets and assumed liabilities, useful lives of long-lived assets, capitalized software development costs, carrying value of operating lease right-of-use (“ROU”) assets and operating lease liabilities, incremental borrowing rates for operating leases, amount of stock-based compensation expense, timing and amount of contingencies, costs related to our restructuring actions, uncertain tax positions, and valuation allowance for deferred income taxes. Actual results could differ from these estimates and assumptions.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

Foreign Currency

The functional currency of our non-U.S. subsidiaries is the local currency. Asset and liability balances denominated in non-U.S. dollar currencies are translated into U.S. dollars using period-end exchange rates, while revenue and expenses are translated using average monthly exchange rates. Differences are included in stockholders’ equity as a component of accumulated other comprehensive income. Financial assets and liabilities denominated in currencies other than the functional currency are recorded at the exchange rate at the time of the transaction and subsequent gains and losses related to changes in the foreign currency are included in other income (expense), net in the condensed consolidated statements of operations. For the three months ended July 31, 2023 and 2022, we recognized transaction losses of $0.6 million and $0.8 million, respectively. For the six months ended July 31, 2023 and 2022, we recognized transaction losses of $1.4 million and $2.2 million, respectively.

Concentration of Risks

Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, marketable securities, and accounts receivable.

We maintain our cash balance at financial institutions that management believes are high-credit, quality financial institutions, where our deposits, at times, exceed Federal Deposit Insurance Corporation (“FDIC”) limits. As of July 31, 2023 and January 31, 2023, 95% and 98%, respectively, of our cash and cash equivalents were concentrated in the United States, European Union (“EU”) countries, and Japan.

The selection of investments in marketable securities is governed by our investment policy. The policy aims to emphasize principles of safety and liquidity, with the overall objective of earning an attractive rate of return while limiting exposure to risk of loss and avoiding inappropriate concentrations. We use this policy to guide our investment decisions as it stipulates, among other things, a list of eligible investment types, minimum ratings and other restrictions for each type, and overall portfolio composition constraints.

With regard to accounts receivable, we extend differing levels of credit to customers based on creditworthiness, do not require collateral deposits, and when necessary maintain reserves for potential credit losses based upon the expected collectability of accounts receivable. We manage credit risk related to our customers by performing periodic evaluations of creditworthiness and applying other credit risk monitoring procedures. Significant customers are those that represent 10% or more of our total revenue for the period or accounts receivable at the balance sheet date. For the three and six months ended July 31, 2023 and 2022, no single customer accounted for 10% or more of our total revenue. As of July 31, 2023 and January 31, 2023, no single customer accounted for 10% or more of our accounts receivable.

Stock-Based Compensation

We recognize stock-based compensation expense in accordance with the provisions of Accounting Standards Codification ("ASC") 718, Compensation—Stock Compensation. ASC 718 requires the measurement and recognition of compensation expense for all stock-based awards made to employees, directors, and non-employees based on the grant date fair value of the awards.

The fair value of each stock option is determined using the Black-Scholes pricing model. The fair value of each restricted stock unit ("RSU") and restricted stock award ("RSA") is determined based on the fair value of our Class A common stock on the grant date. The fair value of each performance stock unit ("PSU") that is dependent on the satisfaction of a performance condition is also determined based on the fair value of our Class A common stock on the grant date.The fair value of shares under our employee stock purchase plan ("ESPP") is determined using the Black-Scholes pricing model.

Stock-based compensation expense is included in cost of revenue and operating expenses within our consolidated statements of operations based on the expense classification of the individual earning the award.

The fair value of awards with only service-based vesting conditions is recognized as expense over the requisite service period on a straight-line basis.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

For PSUs dependent on the satisfaction of a performance condition, compensation expense is recognized only when management believes it is probable that the performance condition will be achieved. Although total compensation expense recognized for these awards will ultimately equal the grant date fair value per share multiplied by the number of shares earned by the holder, changes in management's expectations can cause fluctuations in timing of expense over the life of these awards.

The fair value of ESPP shares is recognized over the relevant offering period on a straight-line basis.

With all award types, we account for forfeitures as they occur.

3. Revenue Recognition

Disaggregation of Revenue

The following tables summarize revenue by geographical region (dollars in thousands):


	Three Months Ended July 31,
	2023				2022
	Amount		Percentage of Revenue		Amount		Percentage of Revenue
Americas (1)	$	139,718	49	%	$	120,977	50	%
Europe, Middle East, and Africa	81,009		28	%	69,521		29	%
Asia-Pacific (2)	66,583		23	%	51,724		21	%
Total revenue	$	287,310	100	%	$	242,222	100	%

(1)Revenue from the United States represented 44% and 45% of our total revenues for the three months ended July 31, 2023 and 2022, respectively.

(2)Revenue from Japan represented 10% and 9% of our total revenues for the three months ended July 31, 2023 and 2022, respectively.


	Six Months Ended July 31,
	2023				2022
	Amount		Percentage of Revenue		Amount		Percentage of Revenue
Americas (1)	$	263,170	46	%	$	235,128	48	%
Europe, Middle East, and Africa	177,940		31	%	139,124		29	%
Asia-Pacific (2)	135,788		23	%	113,036		23	%
Total revenue	$	576,898	100	%	$	487,288	100	%

(1)Revenue from the United States represented 41% and 44% of our total revenues for the six months ended July 31, 2023 and 2022, respectively.

(2)Revenue from Japan represented 11% and 11% of our total revenues for the six months ended July 31, 2023 and 2022, respectively.

Deferred Revenue

During the six months ended July 31, 2023 and 2022, we recognized $254.8 million and $201.9 million of revenue that was included in the deferred revenue balance as of January 31, 2023 and 2022, respectively.

Remaining Performance Obligations

Our remaining performance obligations are comprised of licenses, subscription services, and professional services and other revenue not yet delivered. As of July 31, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $905.4 million, which consists of $487.8 million of billed consideration and $417.6 million of unbilled consideration. We expect to recognize 62% of our remaining performance obligations as revenue over the next 12 months, and the remainder thereafter.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

Deferred Contract Acquisition Costs

Our deferred contract acquisition costs are comprised of sales commissions that represent incremental costs to obtain customer contracts, and are determined based on sales compensation plans. Amortization of deferred contract acquisition costs was $17.1 million and $11.1 million for the three months ended July 31, 2023 and 2022, respectively, and $31.2 million and $21.9 million for the six months ended July 31, 2023 and 2022, respectively, and is recorded in sales and marketing expense in the condensed consolidated statements of operations.

4. Marketable Securities

The following is a summary of our marketable securities (in thousands):


	As of July 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Commercial paper	$	61,740	$	—	$	—	$	61,740
Treasury bills and U.S. government securities (1)	555,966		—		(418)		555,548
Corporate bonds	10,809		—		(39)		10,770
Municipal bonds	1,751		—		(15)		1,736
Agency bonds	106,034		—		(158)		105,876
Total marketable securities	$	736,300	$	—	$	(630)	$	735,670
(1) Treasury bills with both amortized cost and estimated fair value of $39.8 million are included in cash and cash equivalents due to their original maturity of three months or less.


	As of January 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Commercial paper	$	62,470	$	—	$	—	$	62,470
Treasury bills and U.S. government securities (1)	234,848		—		(308)		234,540
Corporate bonds	46,684		—		(198)		46,486
Municipal bonds	6,374		—		(66)		6,308
Agency bonds	7,959		—		(47)		7,912
Total marketable securities	$	358,335	$	—	$	(619)	$	357,716
(1) Treasury bills with both amortized cost and estimated fair value of $10.0 million are included in cash and cash equivalents due to their original maturity of three months or less.

As of July 31, 2023 and January 31, 2023, none and $2.9 million, respectively, of our marketable securities had remaining contractual maturities of one year or more.

As of July 31, 2023 and January 31, 2023, $3.0 million and $3.5 million, respectively, of interest receivable was included in prepaid expenses and other current assets on the condensed consolidated balance sheets. We did not recognize an allowance for credit losses against interest receivable as of July 31, 2023 and January 31, 2023.

Unrealized losses during the periods presented are a result of changes in market conditions. We do not believe that any unrealized losses are attributable to credit-related factors based on our evaluation of available evidence. To determine whether a decline in value is related to credit loss, we evaluate, among other factors, the extent to which the fair value is less than the amortized cost basis and any adverse conditions specifically related to an issuer of a security or its industry.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

5. Fair Value Measurement

The following tables present the fair value hierarchy of our financial assets measured at fair value on a recurring basis as of July 31, 2023 and January 31, 2023 (in thousands):


	As of July 31, 2023
	Level 1		Level 2		Total
Financial assets:
Money market	$	528,156	$	—	$	528,156
Treasury bills	39,807		—		39,807
Commercial paper	—		24,977		24,977

Total cash equivalents	567,963		24,977		592,940
Commercial paper	—		61,740		61,740
Treasury bills and U.S. government securities	555,548		—		555,548
Corporate bonds	—		10,770		10,770
Municipal bonds	—		1,736		1,736
Agency bonds	105,876		—		105,876
Total marketable securities	661,424		74,246		735,670
Total	$	1,229,387	$	99,223	$	1,328,610


	As of January 31, 2023
	Level 1		Level 2		Total
Financial assets:
Money market	$	319,801	$	—	$	319,801
Treasury bills	9,968		—		9,968
Total cash equivalents	329,769		—		329,769
Commercial paper	—		62,470		62,470
Treasury bills and U.S. government securities	234,540		—		234,540
Corporate bonds	—		46,486		46,486
Municipal bonds	—		6,308		6,308
Agency bonds	7,912		—		7,912
Total marketable securities	242,452		115,264		357,716
Total	$	572,221	$	115,264	$	687,485

Our money market funds, treasury bills and U.S. government securities, and agency bonds are classified within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. We classify commercial paper, corporate bonds, and municipal bonds as Level 2 because they are valued using inputs other than quoted prices which are directly or indirectly observable in the market, including readily-available pricing sources for the identical underlying security which may not be actively traded. None of our financial instruments were classified in the Level 3 category as of July 31, 2023 or January 31, 2023.

6. Business Acquisition

Re:infer

On July 29, 2022, we acquired all of the outstanding capital stock of Re:infer LTD. (“Re:infer”), a natural language processing company focused on unstructured documents and communications. Re:infer uses machine learning technology to mine context from communication messages and transform them into actionable data. With this acquisition, we gained technology and an experienced team which we believe will accelerate our technology roadmap, expand the breadth of our current AI-powered automation capabilities, and unlock new automation opportunities for our customers. The Re:infer acquisition was accounted for as a business combination.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

The total purchase consideration for the acquisition of Re:infer was $44.6 million, consisting of the following (in thousands):


Cash paid at closing	$	30,117
Fair value of Class A common stock issued at closing (0.2 million shares)	2,965
Loan note paid on July 29, 2023 (first anniversary of closing)	5,863
Loan note to be paid on second anniversary of closing (included in accrued expenses and other current liabilities as of July 31, 2023)	5,570
Working capital adjustment	66
Total	$	44,581

At closing, we also issued an additional 0.4 million shares of Class A common stock that will be released to sellers in equal installments on the first, second, and third anniversaries of the closing date, subject to certain employment-related clawback provisions. The aggregate fair value of these shares totaled $7.6 million and will be expensed as compensation for post-acquisition services over the three years following the acquisition date.

The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date (in thousands):


	July 29, 2022
Net tangible assets	$	300
Intangible assets	13,100
Goodwill	34,351
Total assets acquired	47,751
Deferred tax liabilities assumed	(3,170)
Total	$	44,581

The following table sets forth the identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition:


	Fair Value (in thousands)		Estimated Useful Life (in years)
Developed technology	$	10,000	5.0
Customer relationships	3,100		3.0
Total	$	13,100

The acquisition of Re:infer generated goodwill of $34.4 million representing expected synergies and acquired skilled workforce. None of this goodwill is deductible for tax purposes.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

7. Intangible Assets and Goodwill

Intangible Assets, Net

Acquired intangible assets, net consisted of the following as of July 31, 2023 (dollars in thousands):


	Intangible Assets, Gross		Accumulated Amortization		Intangible Assets, Net		Weighted- Average Remaining Useful Life (in years)
Developed technology	$	29,194	$	(14,206)	$	14,988	3.2
Customer relationships	8,325		(4,985)		3,340		1.6
Trade names and trademarks	273		(251)		22		0.7
Other intangibles	1,231		(337)		894		7.3
Total	$	39,023	$	(19,779)	$	19,244

Acquired intangible assets, net consisted of the following as of January 31, 2023 (dollars in thousands):


	Intangible Assets, Gross		Accumulated Amortization		Intangible Assets, Net		Weighted- Average Remaining Useful Life (in years)
Developed technology	$	28,517	$	(11,095)	$	17,422	3.5
Customer relationships	8,174		(3,601)		4,573		2.0
Trade names and trademarks	272		(233)		39		1.2
Other intangibles	1,231		(255)		976		7.7
Total	$	38,194	$	(15,184)	$	23,010

We record amortization expense associated with acquired developed technology in cost of licenses revenue and cost of subscription services revenue, trade names and trademarks in sales and marketing expense, customer relationships in sales and marketing expense, and other intangibles in general and administrative expense in the condensed consolidated statements of operations. Amortization of acquired intangible assets for the three months ended July 31, 2023 and 2022 was $2.2 million and $1.3 million, respectively, and for the six months ended July 31, 2023 and 2022 was $4.3 million and $2.7 million, respectively.

Expected future amortization expense related to intangible assets was as follows as of July 31, 2023 (in thousands):


	Amount
Remainder of year ending January 31, 2024	$	4,372
Year ending January 31,
2025	6,766
2026	4,144
2027	2,480
2028	1,179
Thereafter	303
Total	$	19,244

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

Goodwill

Changes in the carrying amount of goodwill during the six months ended July 31, 2023 were as follows (in thousands):


	Carrying Amount
Balance as of January 31, 2023	$	88,010

Effect of foreign currency translation	2,041
Balance as of July 31, 2023	$	90,051

8. Operating Leases

Our operating leases consist of real estate and vehicles and have remaining lease terms of one year to 15 years. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend the lease when it is reasonably certain that we will exercise those options. Our operating lease arrangements do not contain any material restrictive covenants or residual value guarantees.

Lease costs are presented below (in thousands):


	Three Months Ended July 31,				Six Months Ended July 31,
	2023		2022		2023		2022
Operating lease cost	$	3,228	$	2,736	$	6,299	$	5,495
Short-term lease cost	1,320		1,535		2,620		3,043
Variable lease cost	525		316		1,146		523
Sublease income (1)	(533)		(533)		(1,065)		(1,065)
Total	$	4,540	$	4,054	$	9,000	$	7,996

(1) Included in other income (expense), net in the condensed consolidated statements of operations.

The following table represents the weighted-average remaining lease term and discount rate as of the periods presented:


	As of
	July 31, 2023		January 31, 2023
Weighted-average remaining lease term (years)	11.5		12.1
Weighted-average discount rate	7.1	%	7.0	%

Future undiscounted lease payments for our operating lease liabilities as of July 31, 2023 were as follows (in thousands):


	Amount
Remainder of year ending January 31, 2024	$	5,393
Year ending January 31,
2025	11,354
2026	9,225
2027	8,608
2028	7,917
Thereafter	48,965
Total operating lease payments	91,462
Less: imputed interest	(28,422)
Total operating lease liabilities	$	63,040

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

As of July 31, 2023, we had non-cancellable commitments in the amount of $4.6 million related to operating leases of real estate facilities that have not yet commenced.

Current operating lease liabilities of $6.3 million and $7.0 million were included in accrued expenses and other current liabilities on our condensed consolidated balance sheets as of July 31, 2023 and January 31, 2023, respectively.

Supplemental cash flow information related to leases for the three and six months ended July 31, 2023 and 2022 was as follows (in thousands):


	Three Months Ended July 31,				Six Months Ended July 31,
	2023		2022		2023		2022
Cash paid for amounts included in the measurement of operating lease liabilities	$	3,545	$	1,493	$	6,160	$	3,557
Operating lease ROU assets obtained in exchange for new operating lease liabilities	2,688		2,120		4,681		2,890

9. Condensed Consolidated Balance Sheet Components

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):


	As of
	July 31, 2023		January 31, 2023
Prepaid expenses and service credits	$	82,520	$	67,794
Other current assets	24,853		26,356
Prepaid expenses and other current assets	$	107,373	$	94,150

Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):


	As of
	July 31, 2023		January 31, 2023
Computers and equipment	$	29,003	$	28,450
Leasehold improvements	21,843		19,622
Furniture and fixtures	6,604		6,485
Construction in progress	447		2,419
Property and equipment, gross	57,897		56,976
Less: accumulated depreciation	(33,218)		(27,931)
Property and equipment, net	$	24,679	$	29,045

Depreciation expense for the three months ended July 31, 2023 and 2022 was $2.8 million and $1.9 million, respectively. Depreciation expense for the six months ended July 31, 2023 and 2022 was $5.8 million and $3.8 million, respectively.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):


	As of
	July 31, 2023		January 31, 2023
Accrued expenses	$	12,188	$	19,411
Withholding tax from employee equity transactions	2,408		3,772
Employee stock purchase plan withholdings	3,688		3,365
Payroll taxes and other benefits payable	3,879		7,644
Income tax payable	10,220		8,750
Value-added taxes payable	2,567		6,381
Operating lease liabilities, current	6,341		6,997
Deferred consideration for business acquisition, current	5,570		5,863
Other	17,543		14,462
Accrued expenses and other current liabilities	$	64,404	$	76,645

10. Credit Facility

On October 30, 2020 and as amended, we entered into a $200.0 million senior secured revolving credit facility with a maturity date of October 30, 2023 (the “Credit Facility”) with HSBC Ventures USA Inc., Silicon Valley Bank, a division of First Citizens Bank & Trust Company (successor by purchase to the FDIC as receiver for Silicon Valley Bridge Bank, N.A. (as successor to Silicon Valley Bank)), Sumitomo Mitsui Banking Corporation, and Mizuho Bank, LTD (together, the "Lenders"). The Credit Facility contains certain customary covenants, including, but not limited to, those relating to additional indebtedness, liens, asset divestitures, and affiliate transactions.

As of July 31, 2023 and January 31, 2023, there were no amounts outstanding under the Credit Facility.

In September 2023, we and the Lenders terminated the Credit Facility prior to its original maturity date.

11. Commitments and Contingencies

Letters of Credit

We had a total of $3.6 million and $4.3 million in letters of credit outstanding in favor of certain landlords for office space and for credit line facilities as of July 31, 2023 and January 31, 2023, respectively. These letters of credit renew annually and expire on various dates through fiscal year 2025.

Indemnification

In the ordinary course of business, we may provide indemnification of varying scope and terms to customers, vendors, directors, and officers with respect to certain matters, including, but not limited to, losses arising out of our breach of such agreements, services to be provided by us, or from intellectual property infringement claims made by third parties.

These indemnification provisions may survive termination of the underlying agreement and the potential amount of future payments we could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The maximum potential amount of future payments we could be required to make under these indemnification provisions is indeterminable. As of July 31, 2023 and January 31, 2023, we have not accrued a liability for these indemnification arrangements because the likelihood of incurring a payment obligation, if any, in connection with these indemnification arrangements was remote.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

Restructuring

On June 24, 2022, our board of directors approved restructuring actions to manage our operating expenses by reducing our global workforce by approximately 5%. The workforce reduction aimed to simplify our go-to-market approach and improve sales productivity. In connection with these workforce reductions, we also ceased use of our office in Brooklyn, NY. On November 10, 2022, our board of directors approved further restructuring actions to reduce our global workforce across functions by an additional 6%.

For the six months ended July 31, 2023, we incurred $2.6 million of expense associated with employee termination benefits in connection with the completion of our restructuring actions.

The following table shows the total amount incurred, and the liability, which is recorded in accrued compensation and employee benefits in the condensed consolidated balance sheets, for restructuring-related employee termination benefits as of July 31, 2023 (in thousands):


	Employee Termination Benefits
Accrued restructuring costs as of January 31, 2023	$	3,889
Restructuring costs incurred during the six months ended July 31, 2023	2,606
Amount paid during the six months ended July 31, 2023	(4,792)
Accrued restructuring costs as of July 31, 2023	$	1,703

Defined Contribution Plans

We sponsor retirement plans for qualifying employees, including a 401(k) plan in the U.S. and defined contribution plans in certain other countries, to which we make matching contributions. Our total matching contributions to all defined contribution plans was $3.5 million and $3.7 million for the three months ended July 31, 2023 and 2022, respectively, and $9.1 million and $8.7 million for the six months ended July 31, 2023 and 2022, respectively.

Litigation

From time to time, we may be involved in lawsuits, claims, investigations, and proceedings, consisting of intellectual property, commercial, employment, and other matters, which arise in the ordinary course of business. In accordance with ASC 450, Contingencies, we make a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

We are not presently a party to any litigation the outcome of which we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows, or financial condition. We have determined that the existence of a material loss is neither probable nor reasonably possible.

Warranty

We warrant to customers that our platform will operate substantially in accordance with its specifications. Historically, no significant costs have been incurred related to product warranties. Based on such historical experience, the probability of incurring such costs in the future is deemed remote. As such, no accruals for product warranty costs have been made.

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

Non-Cancelable Purchase Obligations

In the normal course of business, we enter into non-cancelable purchase commitments with various parties, mainly for hosting services, software products and services, and credits toward purchase of products and services from strategic alliance partners.

As of July 31, 2023, we had outstanding non-cancelable purchase obligations with a term of 12 months or longer as follows (in thousands):


	Amount
Remainder of year ending January 31, 2024	$	33,578
Year ending January 31,
2025	99,928
2026	56,633
2027	20,332
2028	8,245
Thereafter	—
Total	$	218,716

12. Stockholders’ Equity

Charitable Donations of Class A Common Stock

We have reserved 2.8 million shares of our Class A common stock to fund our social impact and environmental, social, and governance initiatives. During the six months ended July 31, 2023, we contributed 0.3 million shares of our Class A common stock to a donor-advised fund in connection with our Pledge 1% commitment. The aggregate fair value of the shares on the contribution date of $4.2 million was recorded within general and administrative expense in the condensed consolidated statements of operations.

Accumulated Other Comprehensive Income (Loss)

For the six months ended July 31, 2023 and 2022, changes in the components of accumulated other comprehensive income (loss) were as follows (in thousands):


	Foreign Currency Translation Adjustments		Unrealized Gain (Loss) on Marketable Securities		Accumulated Other Comprehensive Income
Balance as of January 31, 2023	$	8,231	$	(619)	$	7,612
Other comprehensive income (loss), net of tax	3,912		(18)		3,894
Balance as of July 31, 2023	$	12,143	$	(637)	$	11,506


	Foreign Currency Translation Adjustments		Unrealized Loss on Marketable Securities		Accumulated Other Comprehensive Income (Loss)
Balance as of January 31, 2022	$	11,234	$	(335)	$	10,899
Other comprehensive income (loss), net of tax	552		(301)		251
Balance as of July 31, 2022	$	11,786	$	(636)	$	11,150

13. Equity Incentive Plans and Stock-Based Compensation

2021 Stock Plan

In April 2021, prior to and in connection with the IPO, we adopted our 2021 Equity Incentive Plan (the "2021 Plan"), which provides for grants of incentive stock options, nonstatutory stock options, stock appreciation rights,

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UiPath, Inc.

Notes to Condensed Consolidated Financial Statements (Continued)

(unaudited)

RSAs, RSUs, PSUs, and other forms of awards. As of July 31, 2023, we have reserved 173.7 million shares of our Class A common stock to be issued under the 2021 Plan. The number of shares of our Class A common stock reserved for issuance under the 2021 Plan will automatically increase on February 1 of each year for a period of ten years, which began on February 1, 2022 and continues through February 1, 2031, in an amount equal to (1) 5% of the total number of shares of our common stock (both Class A and Class B) outstanding on the preceding January 31, or (2) a lesser number of shares determined by our board of directors no later than the February 1 increase.

2021 Employee Stock Purchase Plan

In April 2021, prior to and in connection with the IPO, we adopted our 2021 Employee Stock Purchase Plan (the “ESPP”). As of July 31, 2023, the ESPP authorizes the issuance of 21.5 million shares of our Class A common stock under purchase rights granted to our employees or to employees of any of our designated affiliates. The number of shares of our Class A common stock reserved for issuance will automatically increase on February 1 of each year for a period of ten years, which began on February 1, 2022 and continues through February 1, 2031, by the lesser of (1) 1% of the total number of shares of our common stock (both Class A and Class B) outstanding on the preceding January 31; and (2) 15.5 million shares, except before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth by (1) and (2) above. The ESPP allows participants to purchase shares at the lesser of (a) 85% of the fair market value of our Class A common stock as of the commencement of each offering period, and (b) 85% of the fair market value of our Class A common stock on the corresponding purchase date.

Stock Options

Stock option activity during the six months ended July 31, 2023 was as follows:


	Stock Options (in thousands)	Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Life (years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of January 31, 2023	13,898	$	3.32	7.7	$	169,324
Granted	2,614	$	0.10
Exercised	(2,722)	$	1.43
Forfeited	(205)	$	0.82
Outstanding as of July 31, 2023	13,585	$	3.11	7.7	$	203,300

Vested and exercisable as of July 31, 2023	5,763	$	3.61

Form: 10-Q

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