Quarterly Report (10-q)

Date : 12/06/2018 @ 2:24PM
Source : Edgar (US Regulatory)
Stock : Cloudera, Inc. (CLDR)
Quote : 12.73  0.48 (3.92%) @ 12:45AM
Cloudera, Inc. share price Chart

Quarterly Report (10-q)


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________________
FORM 10-Q 
_______________________________________________
(Mark One)
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 2018
or
o
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 001-38069
 
CLOUDERA, INC.
(Exact name of registrant as specified in its charter)
 
Delaware
26-2922329
(State or other jurisdiction of incorporation or organization)
(I.R.S. employer identification no.)
_______________________________________________
395 Page Mill Road
Palo Alto, CA 94306
(650) 362-0488
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
_______________________________________________

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   x     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   x     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 a emerging growth company. See 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
x
 
Smaller reporting company
¨
 
 
Emerging growth company
x
If an emerging growth company, indicate by checkmark if the registrant has not elected to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act
¨
Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).    Yes    ¨    No   x
As of November 30, 2018 , there were 153,516,784 shares of the registrant’s common stock outstanding.
 



TABLE OF CONTENTS
 
 
Page
 
Part I. Financial Information
 
Item 1.
 
 
 
 
 
 
 
 
Item 2.
Item 3.
Item 4.
 
Part II. Other Information
 
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
 
 




PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CLOUDERA, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
 
October 31,
2018
 
January 31,
2018
ASSETS
 
 
 
CURRENT ASSETS:
 
 
 
Cash and cash equivalents
$
64,632

 
$
43,247

Short-term marketable securities
325,053

 
327,842

Accounts receivable, net
92,586

 
130,579

Prepaid expenses and other current assets
25,176

 
31,470

Total current assets
507,447

 
533,138

Property and equipment, net
21,207

 
17,600

Marketable securities, noncurrent
60,237

 
71,580

Intangible assets, net
3,884

 
5,855

Goodwill
33,621

 
33,621

Restricted cash
3,352

 
18,052

Other assets
6,767

 
9,312

TOTAL ASSETS
$
636,515

 
$
689,158

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
CURRENT LIABILITIES:
 
 
 
Accounts payable
$
2,085

 
$
2,722

Accrued compensation
36,834

 
41,393

Other accrued liabilities
13,376

 
13,454

Deferred revenue, current portion
242,665

 
257,141

Total current liabilities
294,960

 
314,710

Deferred revenue, less current portion
34,654

 
34,870

Other liabilities
20,336

 
16,601

TOTAL LIABILITIES
349,950

 
366,181

STOCKHOLDERS’ EQUITY:
 
 
 
Common stock
8

 
7

Additional paid-in capital
1,460,370

 
1,385,592

Accumulated other comprehensive loss
(1,073
)
 
(832
)
Accumulated deficit
(1,172,740
)
 
(1,061,790
)
TOTAL STOCKHOLDERS’ EQUITY
286,565

 
322,977

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
636,515

 
$
689,158


See Notes to Condensed Consolidated Financial Statements
2

CLOUDERA, INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)



 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Revenue:
 
 
 
 
 
 
 
Subscription
$
99,698

 
$
78,105

 
$
278,720

 
$
216,762

Services
18,485

 
16,464

 
52,508

 
47,231

Total revenue
118,183

 
94,569

 
331,228

 
263,993

Cost of revenue: (1) (2)
 
 
 
 
 
 


Subscription
13,996

 
14,486

 
44,764

 
56,173

Services
15,980

 
18,640

 
50,695

 
69,035

Total cost of revenue
29,976

 
33,126

 
95,459

 
125,208

Gross profit
88,207

 
61,443

 
235,769

 
138,785

Operating expenses: (1) (2)
 
 
 
 
 
 
 
Research and development
37,563

 
38,095

 
121,027

 
176,770

Sales and marketing
54,927

 
64,061

 
169,870

 
236,639

General and administrative
22,067

 
15,877

 
55,493

 
69,991

Total operating expenses
114,557

 
118,033

 
346,390

 
483,400

Loss from operations
(26,350
)
 
(56,590
)
 
(110,621
)
 
(344,615
)
Interest income, net
2,440

 
1,501

 
6,420

 
3,590

Other income (expense), net
(1,126
)
 
(490
)
 
(3,154
)
 
349

Net loss before benefit from (provision for) income taxes
(25,036
)
 
(55,579
)
 
(107,355
)
 
(340,676
)
Benefit from (provision for) income taxes
(1,498
)
 
241

 
(3,595
)
 
(1,210
)
Net loss
$
(26,534
)
 
$
(55,338
)
 
$
(110,950
)
 
$
(341,886
)
Net loss per share, basic and diluted
$
(0.17
)
 
$
(0.40
)
 
$
(0.74
)
 
$
(3.27
)
Weighted-average shares used in computing net loss per share, basic and diluted
152,245

 
138,506

 
149,507

 
104,551


(1)
Amounts include stock‑based compensation expense as follows (in thousands):
 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
 
 
 
 
 
 
Cost of revenue – subscription
$
2,016

 
$
2,750

 
$
7,060

 
$
22,143

Cost of revenue – services
2,290

 
4,187

 
7,540

 
28,414

Research and development
7,805

 
9,110

 
26,002

 
90,139

Sales and marketing
5,504

 
10,070

 
14,281

 
82,748

General and administrative
4,275

 
5,030

 
12,848

 
38,236

(2)
Amounts include amortization of acquired intangible assets as follows (in thousands):
 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Cost of revenue – subscription
$
622

 
$
584

 
$
1,866

 
$
1,608

Sales and marketing
35

 
454

 
105

 
1,315


See Notes to Condensed Consolidated Financial Statements
3

CLOUDERA, INC.
Condensed Consolidated Statements of Comprehensive Loss
(in thousands)
(unaudited)


 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Net loss
$
(26,534
)
 
$
(55,338
)
 
$
(110,950
)
 
$
(341,886
)
Other comprehensive loss, net of tax:
 
 
 
 
 
 
 
Foreign currency translation gain (loss)
(100
)
 
59

 
(449
)
 
33

Unrealized gain (loss) on investments
48

 
(152
)
 
208

 
(91
)
Total other comprehensive loss, net of tax
(52
)
 
(93
)
 
(241
)
 
(58
)
Comprehensive loss
$
(26,586
)
 
$
(55,431
)
 
$
(111,191
)
 
$
(341,944
)


See Notes to Condensed Consolidated Financial Statements
4

CLOUDERA, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)


 
Nine Months Ended October 31,
 
2018
 
2017
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
Net loss
$
(110,950
)
 
$
(341,886
)
Adjustments to reconcile net loss to net cash used in operating activities:
 
 
 
Depreciation and amortization
7,759

 
9,695

Stock-based compensation
67,731

 
261,680

Release of deferred tax valuation allowance

 
(806
)
Accretion and amortization of marketable securities
(661
)
 
657

Gain on disposal of fixed assets
(22
)
 
(111
)
Changes in assets and liabilities:
 
 
 
Accounts receivable
38,310

 
35,536

Prepaid expenses and other assets
8,348

 
(5,459
)
Accounts payable
561

 
(2,326
)
Accrued compensation
(7,034
)
 
(1,231
)
Accrued expenses and other liabilities
4,102

 
9,442

Deferred revenue
(14,118
)
 
14,527

Net cash used in operating activities
(5,974
)
 
(20,282
)
CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
Purchases of marketable securities and other investments
(368,914
)
 
(514,157
)
Sales of marketable securities and other investments
36,009

 
57,436

Maturities of marketable securities and other investments
346,203

 
233,732

Cash used in business combinations, net of cash acquired

 
(1,937
)
Capital expenditures
(9,320
)
 
(9,005
)
Proceeds from sale of equipment
29

 
145

Net cash provided by (used in) investing activities
4,007

 
(233,786
)
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
Net proceeds from issuance of common stock in initial public offering

 
237,422

Net proceeds from issuance of common stock in follow-on offering

 
46,803

Proceeds from employee stock plans
18,760

 
11,221

Taxes paid related to net share settlement of restricted stock units
(8,482
)
 
(50,503
)
Net cash provided by financing activities
10,278

 
244,943

Effect of exchange rate changes on cash, cash equivalents and restricted cash
(1,626
)
 
340

Net increase (decrease) in cash, cash equivalents and restricted cash
6,685

 
(8,785
)
Cash, cash equivalents and restricted cash — Beginning of period
61,299

 
89,632

Cash, cash equivalents and restricted cash — End of period
$
67,984

 
$
80,847

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
 
 
 
Cash paid for income taxes
$
3,069

 
$
1,840

SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES
 
 
 
Purchases of property and equipment in other accrued liabilities
$
202

 
$
261

Fair value of common stock issued as consideration for business combinations
$

 
$
2,081

Offering costs in accounts payable and other accrued liabilities
$

 
$
858

Conversion of redeemable convertible preferred stock to common stock
$

 
$
657,687


See Notes to Condensed Consolidated Financial Statements
5

CLOUDERA, INC.
Notes to Unaudited Condensed Consolidated Financial Statements


 
1. Organization and Description of Business
Cloudera, Inc. was incorporated in the state of Delaware on June 27, 2008 and is headquartered in Palo Alto, California. We sell subscriptions and services for our data management, machine learning and advanced analytics platform, optimized for the cloud. This platform delivers an integrated suite of capabilities for data management, machine learning and advanced analytics, affording customers an agile, scalable and cost‑effective solution for transforming their businesses.
Unless the context requires otherwise, the words “we,” “us,” “our,” the “Company” and “Cloudera” refer to Cloudera, Inc. and its subsidiaries taken as a whole.
As of both October 31, 2018 and January 31, 2018 , we had an accumulated deficit of $1.2 billion and $1.1 billion , respectively. We have funded our operations primarily with the net proceeds we received through the sale of our common stock in our initial public offering (IPO), our follow-on public offering (Follow-on Offering), other public or private sales of equity securities and proceeds from the sale of our subscriptions and services. Management believes that currently available resources will be sufficient to fund our cash requirements for at least the next twelve months.
2.      Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP) and applicable rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. The condensed consolidated financial statements include the results of Cloudera, Inc. and its wholly owned subsidiaries which are located in various countries, including the United States, Australia, China, Germany, Hungary and the United Kingdom. All intercompany balances and transactions have been eliminated upon consolidation. The condensed consolidated balance sheet as of January 31, 2018 has been derived from the audited consolidated financial statements at that date but does not include all of the information and notes required by GAAP for complete financial statements. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The information contained herein reflects all adjustments necessary for a fair presentation of our results of operations, financial position and cash flows. All such adjustments are of a normal, recurring nature. The results of operations for the three and nine months ended October 31, 2018 are not necessarily indicative of results to be expected for the full year ending  January 31, 2019 or for any other interim period or for any other future year.
The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended January 31, 2018 , filed with the SEC on April 4, 2018.
Significant Accounting Policies
There have been no changes to our significant accounting policies described in the annual report filed with the SEC on April 4, 2018.
Fiscal Year
Our fiscal year ends on January 31. References to fiscal  2019 , for example, refer to the fiscal year ending  January 31, 2019 .
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant items

6


subject to such estimates include revenue recognition, the useful lives of property and equipment and intangible assets, allowance for doubtful accounts, stock‑based compensation expense, annual bonus attainment, self‑insurance costs incurred, the fair value of tangible and intangible assets acquired and liabilities assumed resulting from business combinations, the fair value of common stock prior to our IPO in fiscal 2018, the assessment of elements in a multi‑element arrangement and the valuation assigned to each element and contingencies. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ significantly from these estimates.
Segments
We operate as two operating segments – subscription and services. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker, who is our chief executive officer, in deciding how to allocate resources and assess performance.
Cash, Cash Equivalents and Restricted Cash
Cash equivalents consist of short‑term, highly liquid investments with original maturities of three months or less from the date of purchase. Restricted cash represents cash on deposit with financial institutions in support of letters of credit outstanding in favor of certain landlords for office space.
Cash as reported on the condensed consolidated statements of cash flows includes the aggregate amounts of cash and cash equivalents and the restricted cash as shown on the condensed consolidated balance sheets. Cash as reported on the condensed consolidated statements of cash flows consists of the following (in thousands):
 
As of October 31,
 
2018
 
2017
Cash and cash equivalents
$
64,632

 
$
62,797

Restricted cash
3,352

 
18,050

Cash, cash equivalents and restricted cash
$
67,984

 
$
80,847

The restricted cash balance decreased to $3.4 million from $18.1 million in the third quarter ended October 31, 2018 as compared to the year ended January 31, 2018 as a result of the removal of restrictions on letter of credit funds.
Concentration of Credit Risk and Significant Customers
Financial instruments that subject us to concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities, restricted cash, and accounts receivable. Our cash is deposited with high credit quality financial institutions. At times such deposits may be in excess of the Federal Depository Insurance Corporation insured limits. We have not experienced any losses on these deposits.
At October 31, 2018 , one customer represented 11% of accounts receivable. At January 31, 2018 , one customer represented 16% of accounts receivable. For the three and nine months ended October 31, 2018 and 2017 , no single customer accounted for 10% or more of revenue.
Revenue Recognition
We generate revenue from subscriptions and services. Subscription arrangements are typically one to three years in length but may be up to seven years in limited cases. Arrangements with our customers typically do not include general rights of return. Incremental direct costs incurred related to the acquisition or origination of a customer contract are expensed as incurred.
Revenue recognition commences when all of the following criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the fee is fixed or determinable; and (iv) collection is probable.

7


Subscription revenue
Subscription revenue primarily relates to term (or time‑based) subscription agreements for both open source and proprietary software. Subscriptions include internet, email and phone support, bug fixes, and the right to receive unspecified software updates and upgrades released when and if available during the subscription term. Revenue for subscription arrangements is recognized ratably over the contractual term of the arrangement beginning on the date access to the subscription is made available to the customer.
Services revenue
Services revenue relates to professional services for the implementation and use of our subscriptions, machine learning expertise and consultation, training and education services and related reimbursable travel costs.
For time and materials and fixed fee arrangements, revenue is recognized as the services are performed or upon acceptance, if applicable. For milestone‑based arrangements, revenue is recognized upon acceptance or subsequent to completion upon the lapse of any acceptance period.
Revenue for training and education services is recognized upon delivery, except for On‑Demand Training, which is recognized ratably over the contractual term.
Multiple element arrangements
Arrangements with our customers generally include multiple elements such as subscription and services. We allocate revenue to each element of the arrangement based on vendor‑specific objective evidence of each element’s fair value (VSOE) when we can demonstrate sufficient evidence of the fair value. VSOE for elements of an arrangement is based upon the normal pricing and discounting practices for those elements when sold separately on a stand‑alone basis.
We have established VSOE for some of our services. If VSOE for one or more undelivered elements does not exist, revenue recognition does not commence until delivery of both the subscription and services have commenced, or when VSOE of the undelivered elements has been established. Once revenue recognition commences, revenue for the arrangement is recognized ratably over the longest service period in the arrangement.
Reseller arrangements
We recognize subscription revenue for sales through resellers or other indirect sales channels. Subscription revenue from these sales is generally recognized upon sell‑through to an end user customer. Where payments to us are believed to be contingent upon payment by the end user to the reseller, subscription revenue is not recognized until cash is collected.
Deferred revenue
Deferred revenue consists of amounts billed to or collected from customers under a binding agreement provided delivery of the related subscription and services has commenced.
Stock‑Based Compensation
We recognize stock‑based compensation expense for all stock‑based payments. Employee stock‑based compensation cost is estimated at the grant date based on the fair value of the equity for financial reporting purposes and is recognized as expense over the requisite service period.
We calculate the fair value of stock options and purchase rights granted under the 2017 Employee Stock Purchase Plan (ESPP) based on the Black‑Scholes option‑pricing model. The Black‑Scholes model requires the use of various assumptions including expected term and expected stock price volatility. We estimate the expected term for options using the simplified method due to the lack of historical exercise activity. The simplified method calculates the expected term as the midpoint between the vesting date and the contractual expiration date of the award. The expected term for the ESPP purchase rights is estimated using the offering period, which is typically six months. We estimate volatility for options and ESPP purchase rights using volatilities of a group of public

8


companies in a similar industry, stage of life cycle and size. The interest rate is derived from government bonds with a similar term to that of the options or ESPP purchase rights granted. We have not declared nor do we expect to declare dividends. Therefore, there is no dividend impact on the valuation of options or ESPP purchase rights. We use the straight‑line method for employee expense attribution for options and ESPP purchase rights.
We have granted restricted stock units (RSUs) to our employees and members of our board of directors under our 2008 Equity Incentive Plan (2008 Plan) and our 2017 Equity Incentive Plan (2017 Plan). Prior to our IPO in May 2017, the employee RSUs vested upon the satisfaction of both a service‑based vesting condition and a liquidity event‑related performance condition. RSUs granted subsequent to our IPO vest upon the satisfaction of a service‑based vesting condition only. The service‑based condition for the majority of these awards is generally satisfied pro‑rata over  four years. The liquidity event‑related performance condition was achieved for the majority of our RSUs and became probable of being achieved for the remaining RSUs on April 27, 2017, the effective date of our IPO. We recognized stock‑based compensation expense using the accelerated attribution method with a cumulative catch‑up of stock‑based compensation expense in the amount of  $181.5 million  in fiscal 2018, attributable to service prior to such effective date.
We estimate the fair value of options and other equity awards granted to non‑employees using the Black‑Scholes method. These awards are subject to periodic re‑measurement over the period during which services are rendered. Stock‑based compensation expense is recognized over the vesting period on a straight‑line basis.
Income Taxes
We account for income taxes under the liability method, whereby deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. A valuation allowance is established when, in management’s estimate, it is more likely than not that the deferred tax asset will not be realized.
Any liability related to uncertain tax positions is recorded on the financial statements within other liabilities. Penalties and interest expense related to income taxes, including uncertain tax positions, are classified as a component of provision for income taxes, as necessary.
In December 2017, the U.S. federal government enacted the 2017 Tax Cuts & Jobs Act (Tax Act). The Tax Act includes a number of changes in existing tax law impacting businesses, including the transition tax, a one‑time deemed repatriation of cumulative undistributed foreign earnings and a permanent reduction in the U.S. federal statutory rate from 35% to 21%, effective on January 1, 2018. We were required to recognize the effects of the tax law changes in the period of enactment, including the determination of the transition tax and the re-measurement of deferred taxes as well as to re-assess the realizability of our deferred tax assets. Subsequent to the enactment of the Tax Act, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which allows companies to record provisional amounts related to the effects of the Tax Act during a measurement period not to extend beyond one year of the enactment date. Due to the timing of the Tax Act and additional guidance and interpretations that may be issued by the U.S. Treasury Department, Internal Revenue Service and other standard-setting bodies in the future, we have not completed our analysis of the income tax effects of the Tax Act. Our provisional estimates will be adjusted during the measurement period defined under SAB 118, based upon our ongoing analysis of our data and tax positions along with the new guidance from regulators and interpretations of the law.
JOBS Act Accounting Election
We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (JOBS Act). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. We have elected to retain the ability to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to

9


companies that comply with new or revised accounting pronouncements as of public company effective dates. Because the market value of our common stock held by non-affiliates exceeded $700 million as of July 31, 2018, we will be deemed a “large accelerated filer” under the Exchange Act and will lose emerging growth company status as of January 31, 2019.
Recently Adopted Accounting Standards
We adopted the following accounting standards in the first quarter of fiscal 2019:
ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments
ASU 2016-16, Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory
ASU 2017-01,  Business Combinations (Topic 805): Clarifying the Definition of a Business
ASU No. 2017-09,  Compensation  Stock Compensation (Topic 718): Scope of Modification Accounting
The adoption of the above listed accounting standards did not have a material impact on our condensed consolidated financial statements for the three and nine month periods ended October 31, 2018 .
Recently Issued Accounting Standards
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU No. 2014‑09, Revenue from Contracts with Customers (Topic 606) , or ASU 2014‑09, which amended the existing FASB Accounting Standards Codification. ASU 2014‑09 establishes a principle for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services and also provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts.
We plan to adopt this standard on February 1, 2019 using the full-retrospective method. This method will result in the new standard being applied retrospectively to each prior period presented within the consolidated financial statements at the adoption date.
We are also currently evaluating the impact ASU 2014‑09 will have on our consolidated financial statements, accounting policies, processes, and system requirements. We have assigned internal resources in addition to engaging third party service providers to assist in the evaluation. While we continue to assess all potential impacts under ASU 2014‑09, we have completed a preliminary assessment to determine the effect of adoption on our existing revenue arrangements and are analyzing specific transactions to confirm those conclusions. We have also begun implementing our new revenue recognition systems.
We currently recognize subscription revenue ratably over the subscription period. Under the new standard, these subscription arrangements represent two performance obligations: a software license that is delivered upfront and a series of performance obligations that are delivered over time. We believe that a significant portion of our subscription revenue meets the criteria for revenue recognition over time and the vast majority of the revenue will continue to be recognized ratably under the new standard. We expect that a portion of the arrangement fee related to the software license will be recognized upfront, which we believe will usually be insignificant in comparison to the entire arrangement, as we offer the substantial majority of functional features for free in the open source version of our software. Accounting for certain sales commissions under ASU 2014‑09 is different than our current accounting policy which is to expense sales commissions as incurred whereas such costs will be deferred and amortized under ASU 2014‑09. This will result in an increase in deferred costs recognized on our balance sheet. Additionally, we believe that the amortization period for such deferred commission costs will be longer than the contract term, as ASU 2014‑09 requires entities to determine whether the costs relate to specific anticipated contracts.
While we continue to assess the potential impacts of ASU 2014‑09, including the areas described above, and anticipate the standard will have a material impact on our consolidated financial statements, we do not know and cannot reasonably estimate the quantitative impact on our consolidated financial statements at this time.

10


In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10), which requires all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under the equity method of accounting or those that result in consolidation of the investee).The amendments in this update also require an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. In addition the amendments in this update eliminate the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities and the requirement to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet for public business entities. We plan to adopt this standard on February 1, 2019. We estimate the quantitative impact of adopting the new standard will be immaterial on our consolidated financial statements and disclosures.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , or ASU 2016-02, which requires lessees to record most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. ASU 2016‑02 states that a lessee would recognize a lease liability for the obligation to make lease payments and a right‑to‑use asset for the right to use the underlying asset for the lease term. We plan to adopt this standard on February 1, 2019. We have assigned internal resources in addition to engaging third party service providers to assist in our evaluation of the impact of the adoption of this standard on our consolidated financial statements. We are in the process of assessing the appropriate changes to our accounting policies, business processes, controls, and systems necessary to support the adoption of this standard. We do not know and cannot reasonably estimate the quantitative impact of the new standard on our consolidated financial statements and disclosures at this time.
3.      Proposed Business Combination
Hortonworks, Inc.
On October 3, 2018, we entered into a merger agreement with Hortonworks, Inc. (Hortonworks), a provider of enterprise-grade, global data management platforms, services and solutions that deliver actionable intelligence from any type of data for over half of the Fortune 100. Following the completion of the merger, each share of Hortonworks common stock, par value $0.0001 per share, issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive 1.305 newly issued shares of our common stock, par value $0.00005 per share. No fractional shares of our common stock will be issued in the merger, and Hortonworks stockholders will receive cash in lieu of fractional shares. We are also assuming options to purchase shares of Hortonworks common stock as well as Hortonworks restricted stock units outstanding immediately prior to the effective time of the proposed merger. We and Hortonworks plan to hold our respective stockholder meetings to vote on the proposed merger in late December 2018 with the completion of the merger to follow soon thereafter .
The purchase price is estimated to be approximately $1.4 billion and will be allocated to the assets acquired and liabilities assumed based upon the fair value of our common stock as of the acquisition date.
We expect to incur costs of approximately $24.3 million in connection with the proposed merger, inclusive of transaction-related fees, legal, accounting and other professional fees and excluding fees related to merger planning and integration, retention and severance payments, of which $5.6 million have been incurred in the three month period ended October 31, 2018 . For further information on the proposed merger, refer to the merger agreement, a copy of which has been filed as Exhibit 2.1 to our Current Report on Form 8-K filed with the SEC on October 3, 2018.

11


4.      Cash Equivalents and Marketable Securities
The following are the fair values of our cash equivalents and marketable securities as of October 31, 2018 (in thousands):
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Estimated
Fair Value
 
 
 
 
 
 
 
 
Cash equivalents: (1)
 
 
 
 
 
 
 
Money market funds
$
17,871

 
$

 
$

 
$
17,871

Commercial paper
11,243

 

 

 
11,243

Marketable securities:
 
 
 
 
 
 
 
U.S. agency obligations
7,779

 

 
(10
)
 
7,769

Asset-backed securities
73,198

 

 
(152
)
 
73,046

Corporate notes and obligations
142,418

 
5

 
(363
)
 
142,060

Commercial paper
83,181

 
1

 
(2
)
 
83,180

Certificates of deposit
48,402

 
12

 
(10
)
 
48,404

U.S. treasury securities
26,859

 

 
(28
)
 
26,831

Foreign government obligations
4,000

 

 

 
4,000

Total cash equivalents and marketable securities
$
414,951

 
$
18

 
$
(565
)
 
$
414,404


(1)
Included in “cash and cash equivalents” in the accompanying consolidated balance sheet as of October 31, 2018 .
The following are the fair values of our cash equivalents and marketable securities as of January 31, 2018 (in thousands):
 
Amortized
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Estimated
Fair Value
 
 
 
 
 
 
 
 
Cash equivalents: (1)
 
 
 
 
 
 
 
Money market funds
$
10,226

 
$

 
$

 
$
10,226

Asset-backed securities
1,600

 

 

 
1,600

Marketable securities:
 
 
 
 
 
 
 
U.S. agency obligations
7,803

 
 
 
(39
)
 
7,764

Asset-backed securities
46,529

 

 
(124
)
 
46,405

Corporate notes and obligations
195,460

 
3

 
(517
)
 
194,946

Commercial paper
85,438

 

 
(16
)
 
85,422

Municipal securities
13,339

 

 
(18
)
 
13,321

Certificates of deposit
24,705

 
3

 
(7
)
 
24,701

U.S. treasury securities
26,903

 

 
(40
)
 
26,863

Total cash equivalents and marketable securities
$
412,003

 
$
6

 
$
(761
)
 
$
411,248


(1)
Included in “cash and cash equivalents” in the accompanying consolidated balance sheet as of January 31, 2018 .
Maturities of our noncurrent marketable securities generally ranged from one year to three years at October 31, 2018 and January 31, 2018 .

12


As of  October 31, 2018 , the following marketable securities were in an unrealized loss position (in thousands):
 
Less than 12 months
 
Greater than 12 months
 
Total
 
Fair Value
 
Unrealized
Losses
 
Fair Value
 
Unrealized
Losses
 
Fair Value
 
Unrealized
Losses
U.S. agency obligations
$

 
$

 
$
7,770

 
$
(10
)
 
$
7,770

 
$
(10
)
Asset-backed securities
59,983

 
(96
)
 
13,063

 
(56
)
 
73,046

 
(152
)
Corporate notes and obligations
91,343

 
(253
)
 
37,257

 
(110
)
 
128,600

 
(363
)
Commercial paper
11,203

 
(2
)
 

 

 
11,203

 
(2
)
Certificates of deposit
15,991

 
(10
)
 

 

 
15,991

 
(10
)
U.S. treasury securities
24,854

 
(8
)
 
1,977

 
(20
)
 
26,831

 
(28
)
Foreign government obligations
4,000

 

 

 

 
4,000

 

Total
$
207,374

 
$
(369
)
 
$
60,067

 
$
(196
)
 
$
267,441

 
$
(565
)

As of  January 31, 2018 , the following marketable securities were in an unrealized loss position (in thousands):
 
Less than 12 months
 
Greater than 12 months
 
Total
 
Fair Value
 
Unrealized
Losses
 
Fair Value
 
Unrealized
Losses
 
Fair Value
 
Unrealized
Losses
U.S. agency obligations
$
7,764

 
$
(39
)
 
$

 
$

 
$
7,764

 
$
(39
)
Asset-backed securities
42,399

 
(124
)
 
308

 

 
42,707

 
(124
)
Corporate notes and obligations
173,508

 
(498
)
 
7,997

 
(19
)
 
181,505

 
(517
)
Commercial paper
25,852

 
(16
)
 

 

 
25,852

 
(16
)
Municipal securities
9,323

 
(18
)
 

 

 
9,323

 
(18
)
Certificates of deposit
16,199

 
(7
)
 

 

 
16,199

 
(7
)
U.S. treasury securities
21,863

 
(40
)
 

 

 
21,863

 
(40
)
Total
$
296,908

 
$
(742
)
 
$
8,305

 
$
(19
)
 
$
305,213

 
$
(761
)
The unrealized loss for each of these fixed rate marketable securities was not material as of October 31, 2018 or as of January 31, 2018 . We do not believe any of the unrealized losses represent an other‑than‑temporary impairment based on our evaluation of available evidence as of October 31, 2018 and January 31, 2018 . We expect to receive the full principal and interest on all of these marketable securities and have the ability and intent to hold these investments until a recovery of fair value.
Realized gains and realized losses on our cash equivalents and marketable securities are included in other income (expense), net on the condensed consolidated statement of operations and were not material for the three and nine months ended October 31, 2018 and 2017 .
Reclassification adjustments out of accumulated other comprehensive loss into net loss were not material for the three and nine months ended October 31, 2018 and 2017 .
5.      Fair Value Measurement
Our financial assets and liabilities consist principally of cash and cash equivalents, marketable securities, restricted cash, accounts receivable, and accounts payable. We measure and record certain financial assets and liabilities at fair value on a recurring basis. The estimated fair value of accounts receivable and accounts payable approximates their carrying value due to their short‑term nature. Cash equivalents, marketable securities and restricted cash are recorded at estimated fair value.

13


We follow a three‑level valuation hierarchy for disclosure of fair value measurements as follows:
Level 1
Inputs are unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date.
Level 2
Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.
Level 3
Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.
All of our cash equivalents and marketable securities are classified within Level 1 or Level 2 because the cash equivalents and marketable securities are valued using quoted market prices or alternative pricing sources and models utilizing observable market inputs.
The following table represents our financial assets according to the fair value hierarchy, measured at fair value as of October 31, 2018 (in thousands):
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash equivalents:
 
 
 
 
 
 
 
Money market funds
$
17,871

 
$

 
$

 
$
17,871

Commercial paper

 
11,243

 

 
11,243

Marketable securities:
 
 
 
 
 
 
 
U.S. agency obligations

 
7,769

 

 
7,769

Asset-backed securities

 
73,046

 

 
73,046

Corporate notes and obligations

 
142,060

 

 
142,060

Commercial paper

 
83,180

 

 
83,180

Certificates of deposit

 
48,404

 

 
48,404

U.S. treasury securities (1)
14,861

 
11,970

 

 
26,831

 Foreign government obligations

 
4,000

 

 
4,000

Total financial assets
$
32,732

 
$
381,672

 
$

 
$
414,404

 
(1)
U.S. treasury securities classified as Level 1 are U.S. treasury bills for which there are quoted prices in active markets.

14



The following table represents our financial assets according to the fair value hierarchy, measured at fair value as of January 31, 2018 (in thousands):
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash equivalents:
 
 
 
 
 
 
 
Money market funds
$
10,226

 
$

 
$

 
$
10,226

Asset-backed securities

 
1,600

 

 
1,600

Marketable securities:
 
 
 
 
 
 
 
U.S. agency obligations

 
7,764

 

 
7,764

Asset-backed securities

 
46,405

 

 
46,405

Corporate notes and obligations

 
194,946

 

 
194,946

Commercial paper

 
85,422

 

 
85,422

Municipal securities

 
13,321

 

 
13,321

Certificates of deposit

 
24,701

 

 
24,701

U.S. treasury securities (1)
24,886

 
1,977

 

 
26,863

Restricted cash:
 
 
 
 
 
 
 
Money market funds
14,672

 

 

 
14,672

Total financial assets
$
49,784

 
$
376,136

 
$

 
$
425,920

(1)
U.S. treasury securities classified as Level 1 are U.S. treasury bills for which there are quoted prices in active markets.

We value our Level 1 assets using quoted prices in active markets for identical instruments. We value our Level 2 assets with the help of a third‑party pricing service using quoted market prices for similar instruments, nonbinding market prices that are corroborated by observable market data, or pricing models such as discounted cash flow techniques. We use such pricing data as the primary input, to which we have not made any material adjustments during the periods presented, to make our determination and assessments as to the ultimate valuation of these assets.There were no transfers into or out of Level 1, Level 2 or Level 3 assets and liabilities for the three and nine months ended October 31, 2018 and 2017 .
6.      Balance Sheet Components
Property and Equipment, Net
The cost and accumulated depreciation and amortization of property and equipment are as follows (in thousands):
 
As of
 
October 31, 2018
 
January 31, 2018
Computer equipment and software
$
18,250

 
$
17,139

Office furniture and equipment
10,393

 
7,981

Leasehold improvements
20,184

 
13,469

Construction in progress
432

 
3,243

Property and equipment, gross
49,259

 
41,832

Less: accumulated depreciation and amortization
(28,052
)
 
(24,232
)
Property and equipment, net
$
21,207

 
$
17,600

Construction in progress primarily consists of leasehold improvements that have not been placed into service as of October 31, 2018 and January 31, 2018 .

15


Depreciation expense was $2.0 million and $1.6 million for the three months ended October 31, 2018 and 2017 , respectively, and $5.8 million and $6.7 million for the nine months ended October 31, 2018 and 2017 , respectively.
Intangible Assets
Intangible assets consisted of the following as of October 31, 2018 (dollars in thousands):
 
Gross Fair
Value
 
Accumulated
Amortization
 
Net Book
Value
 
Weighted Average
Remaining Useful Life
(in years)
Developed technology
$
11,986

 
$
(8,636
)
 
$
3,350

 
2.0
Customer relationships and other acquired intangible assets
6,797

 
(6,263
)
 
534

 
3.8
Total
$
18,783

 
$
(14,899
)
 
$
3,884

 
2.3
Intangible assets consisted of the following as of January 31, 2018 (dollars in thousands):
 
Gross Fair
Value
 
Accumulated
Amortization
 
Net Book
Value
 
Weighted Average
Remaining Useful Life
(in years)
Developed technology
$
11,986

 
$
(6,769
)
 
$
5,217

 
2.5
Customer relationships and other acquired intangible assets
6,797

 
(6,159
)
 
638

 
4.6
Total
$
18,783

 
$
(12,928
)
 
$
5,855

 
2.8
Amortization expense for intangible assets was $0.7 million and $1.0 million for the three months ended October 31, 2018 and 2017 , respectively, and $2.0 million and $2.9 million for the nine months ended October 31, 2018 and 2017 , respectively.

The expected future amortization expense of these intangible assets as of October 31, 2018 is as follows (in thousands, by fiscal year):
 
 
Remaining three months of fiscal 2019
$
657

2020
1,737

2021
944

2022
464

2023 and thereafter
82

Total amortization expense
$
3,884


16


Accrued Compensation
Accrued compensation consists of the following (in thousands):
 
As of
 
October 31,
2018
 
January 31,
2018
Accrued salaries, benefits and commissions
$
11,513

 
$
15,039

Accrued bonuses
15,376

 
17,875

Employee stock purchase plan withholdings
5,468

 
2,238

Accrued compensation related taxes and other
4,477

 
6,241

Total accrued compensation
$
36,834

 
$
41,393

Other Accrued Liabilities
Other accrued liabilities consists of the following (in thousands):
 
As of
 
October 31,
2018
 
January 31,
2018
Accrued taxes
$
2,815

 
$
2,092

Accrued professional costs
3,061

 
2,463

Accrued self-insurance costs
1,234

 
1,285

Accrued travel
1,710

 
1,492

Accrued sublessee liability

 
1,573

Other
4,556

 
4,549

Total other accrued liabilities
$
13,376

 
$
13,454

Other includes deferred real estate costs, customer deposits, amounts owed to third‑party vendors that provide marketing, corporate event planning and cloud‑computing services.
7.      Commitments and Contingencies
Letters of Credit
As of October 31, 2018 and January 31, 2018 , we had a total of  $19.5 million and $19.7 million , respectively, in letters of credit outstanding in favor of certain landlords for office space. There have been no draws on these letters of credit, and they renew annually and expire at various dates through 2027.

17


Operating Leases
We lease facilities space under non‑cancelable operating leases with various expiration dates through November, 2027 . Future minimum lease payments and sublease proceeds under non-cancelable operating leases with an initial lease term greater than one year at October 31, 2018 are as follows (in thousands, by fiscal year):
 
Minimum Lease Payments
 
Sublease Rental Proceeds
 
Net Minimum Lease Payments
Remaining three months of fiscal 2019
$
9,078

 
$
(3,706
)
 
$
5,372

2020
36,006

 
(15,073
)
 
20,933

2021
35,468

 
(14,446
)
 
21,022

2022
31,778

 
(10,858
)
 
20,920

2023
29,480

 
(4,388
)
 
25,092

2024 and thereafter
133,387

 

 
133,387

Total
$
275,197

 
$
(48,471
)
 
$
226,726

Rental expense related to our non‑cancelable operating leases was approximately $5.5 million and $4.8 million for the three months ended October 31, 2018 and 2017 , respectively, and $17.0 million and $10.5 million for the nine months ended October 31, 2018 and 2017 , respectively.
Deferred Rent
We account for operating leases containing predetermined fixed increases of the base rental rate during the lease term on a straight‑line basis over the lease term. We recorded the difference between amounts charged to operations and amounts payable under our operating leases as deferred rent in the consolidated balance sheets.
Indemnification
From time to time, we enter into certain types of contracts that contingently require us to indemnify various parties against claims from third parties. These contracts primarily relate to (i) certain real estate leases under which we may be required to indemnify property owners for environmental and other liabilities and other claims arising from our use of the applicable premises, (ii) our bylaws, under which we must indemnify directors and executive officers, and may indemnify other officers and employees, for liabilities arising out of their relationship with us, (iii) contracts under which we must indemnify directors and certain officers for liabilities arising out of their relationship with us, (iv) contracts under which we may be required to indemnify customers or partners against certain claims, including claims from third parties asserting, among other things, infringement of their intellectual property rights, and (v) procurement, consulting, or license agreements under which we may be required to indemnify vendors, consultants or licensors for certain claims, including claims that may be brought against them arising from our acts or omissions with respect to the supplied products, technology or services. From time to time, we may receive indemnification claims under these contracts in the normal course of business. In addition, under these contracts we may have to modify the accused infringing intellectual property and/or refund amounts received.
In the event that one or more of these matters were to result in a claim against us, an adverse outcome, including a judgment or settlement, may cause a material adverse effect on our future business, operating results or financial condition. It is not possible to determine the maximum potential amount under these contracts due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement.
We maintain director and officer insurance, which may cover certain liabilities arising from our obligation to indemnify our directors and certain officers.
To date, we have not incurred any material costs, and have not accrued any liabilities in the consolidated financial statements as a result of these provisions.

18


Contingencies
In the ordinary course of business, we are or may be involved in a variety of litigation matters, suits, investigations, and proceedings, including actions with respect to intellectual property claims, government investigations, labor and employment claims, breach of contract claims, tax, and other matters. Regardless of the outcome, these litigation matters can have an adverse impact on us because of defense costs, diversion of management resources, harm to reputation, and other factors. In addition, it is possible that an unfavorable resolution of one or more such litigation matters could, in the future, materially and adversely affect our financial position, results of operations, and cash flows in a particular period or subject us to an injunction that could seriously harm our business.
We record a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. With respect to our outstanding legal matters management believes that the amount or estimable range of possible loss will not, either individually or in the aggregate, have a material adverse effect on our business, consolidated financial position, results of operations, or cash flows. However, the outcome of litigation is inherently uncertain. Therefore, if one or more of these legal matters were resolved against us for amounts in excess of management’s expectations, our results of operations and financial condition including in a particular reporting period, could be materially adversely affected.
8.     Stockholders’ Equity
Common Stock
At October 31, 2018 and January 31, 2018 there were 1,200,000,000 shares of common stock, par value $0.00005 , authorized and 153,443,586 and 145,327,001 shares of common stock issued and outstanding, respectively.
Employee Stock Plans
We maintain two share-based compensation plans: the 2017 Plan and 2008 Plan, collectively referred to as the Stock Plans. We do not expect to grant any additional awards under the 2008 Plan. Outstanding awards under the 2008 Plan continue to be subject to the terms and conditions of the 2008 Plan.
The number of shares reserved for issuance under our 2017 Plan will increase automatically on the first day of February of each calendar year during the term of the 2017 Plan by a number of shares of common stock equal to the lesser of (i) 5% of the total outstanding shares of our common stock as of the immediately preceding January 31 or (ii) a number of shares determined by our board of directors. On February 1, 2018, 7,266,350  additional shares were authorized for issuance by the board of directors.
As of October 31, 2018 there were 69,141,647 shares of common stock reserved and available for future issuance under the Stock Plans.
The Stock Plans provide for stock options to be granted at an exercise price not less than 100% of the fair market value at the grant date as determined by our board of directors, unless, with respect to incentive stock options, the optionee is a 10% stockholder, in which case the stock option price will not be less than 110% of such fair market value. Stock options granted generally have a maximum term of ten years from the grant date, are exercisable upon vesting unless otherwise designated for early exercise by the board of directors at the time of grant, and generally vest over a four year period, with 25% vesting after one year and then ratably on a monthly basis for the remaining three years.

19


The following tables summarize stock option activity and related information under the Stock Plans:

 
Stock Options Outstanding
 
Weighted-Average Exercise Price
 
Weighted-Average Remaining Contractual Term (Years)
 
Aggregate
Intrinsic 
Value
(in thousands)
Balance —January 31, 2018
18,406,920

 
$
5.03

 
5.3
 
$
252,571

Exercised
(2,269,841
)
 
4.10

 

 

Canceled
(452,790
)
 
11.63

 

 

Balance — October 31, 2018
15,684,289

 
$
4.98

 
4.6
 
$
143,819



The total intrinsic value of stock options exercised during the nine months ended October 31, 2018 and 2017 was $26.3 million and $21.5 million , respectively. The intrinsic value is the difference between the current fair market value of the stock for accounting purposes at the time of exercise and the exercise price of the stock option. As we have accumulated net operating losses, no future tax benefit related to stock option exercises has been recognized.
There were no employee stock options granted during the nine months ended October 31,   2018 .
The weighted‑average grant‑date value for purposes of recognizing stock‑based compensation expense of employee stock options granted during the nine months ended October 31,   2017 was $8.67 per share .
The unamortized stock‑based compensation expense for stock options of $3.4 million at October 31, 2018 will be recognized over the average remaining vesting period of 1.2 years.
We issue RSUs to employees and directors under the Stock Plans. For new employee grants, the RSUs generally meet the service‑based condition over a four -year period, with 25% met after one year and then ratably on a quarterly basis for the remaining three years. For continuing employee grants, the RSUs generally meet the service‑based condition pro‑rata quarterly over the four ‑year period (without a one ‑year cliff).
The employee RSUs issued prior to our IPO under the 2008 Plan have two vesting conditions: (1) a service‑based condition and (2) a liquidity event‑related performance condition which is considered a performance‑based condition. The liquidity event‑related performance condition was achieved for the majority of our RSUs and became probable of being achieved for the remaining RSUs on April 27, 2017, the effective date of our IPO. We recognized stock‑based compensation expense using the accelerated attribution method with a cumulative catch‑up of stock‑based compensation expense in the amount of $181.5 million attributable to service prior to such effective date.
Restricted stock activity for our Stock Plans is as follows:
 
Restricted Stock Units Outstanding
 
Number of Restricted Stock Units
 
Weighted-Average Grant Date Fair Value Per Share
Balance —January 31, 2018
22,243,334

 
$
16.08

Granted
4,769,550

 
16.78

Canceled
(3,568,772
)
 
15.79

Vested and converted to shares
(5,862,431
)
 
16.05

Balance —October 31, 2018
17,581,681

 
$
16.35


20


The unamortized stock‑based compensation expense for RSUs of $208.6 million at October 31, 2018 will be recognized over the average remaining vesting period of 2.4 years.
2017 Employee Stock Purchase Plan
In March 2017, we adopted our 2017 Employee Stock Purchase Plan (ESPP). The ESPP became effective on April 27, 2017, the effective date of our IPO. Our ESPP is intended to qualify as an employee stock purchase plan under Section 423 of the United States Internal Revenue Code of 1986, as amended. Purchases will be accomplished through participation in discrete offering periods. Each offering period is six months (commencing each June 21 and December 21) and consists of one  six ‑month purchase period, unless otherwise determined by our board of directors or our compensation committee.
Under our ESPP, eligible employees will be able to acquire shares of our common stock by accumulating funds through payroll deductions. Our employees generally are eligible to participate in our ESPP if they are employed by us for at least 20 hours per week and more than five months in a calendar year. Employees who are 5% stockholders, or would become 5% stockholders as a result of their participation in our ESPP, are ineligible to participate in our ESPP. We may impose additional restrictions on eligibility. Our eligible employees are able to select a rate of payroll deduction between  1% and 15% of their base cash compensation. The purchase price for shares of our common stock purchased under our ESPP is 85% of the lesser of the fair market value of our common stock on (i) the first trading day of the applicable offering period and (ii) the last trading day of each purchase period in the applicable offering period. No participant has the right to purchase shares of our common stock in an amount, when aggregated with purchase rights under all our employee stock purchase plans that are also in effect in the same calendar year(s), that has a fair market value of more than $25,000 , determined as of the first day of the applicable purchase period, for each calendar year in which that right is outstanding. In addition, no participant is permitted to purchase more than 2,500 shares during any one purchase period or such lesser amount determined by our compensation committee or our board of directors. Once an employee is enrolled in our ESPP, participation will be automatic in subsequent offering periods. An employee’s participation automatically ends upon termination of employment for any reason.
We initially reserved 3,000,000 shares of our common stock for issuance under our ESPP. The number of shares reserved for issuance under our ESPP will increase automatically on February 1 of each of the first 10  calendar years following the first offering date by the number of shares equal to the lesser of either (i) 1% of the total outstanding shares of our common stock as of the immediately preceding January 31 (rounded to the nearest whole share) or (ii) a number of shares of our common stock determined by our board of directors. On February 1, 2018, 1,453,270  additional shares were authorized for issuance by the board of directors.
As of  October 31, 2018 $5.5 million has been withheld on behalf of employees for a future purchase under the ESPP and is recorded in accrued compensation.
9.     Income Taxes
Our quarterly income taxes reflect an estimate of our corresponding year’s annual effective tax rate and include, when applicable, adjustments for discrete items. For the nine months ended October 31, 2018 , our tax provision was $3.6 million , compared to $1.2 million for the same period a year ago. The tax provision for the nine months ended October 31, 2018 primarily relates to an increase in foreign withholding taxes on international sales and income taxes of our non-U.S. operations as our U.S. operations were in a loss position and we maintain a full valuation allowance against our U.S. deferred tax assets.
In December 2017, the SEC staff issued Staff Accounting Bulletin ("SAB") No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act, which allows companies to record provisional amounts for the Tax Cut and Jobs Act during a measurement period not to extend beyond one year of the enactment date. As of October 31, 2018 we did not have any significant adjustments to our provisional amounts. We will continue our analysis of these provisional amounts, which are still subject to change during the measurement period.
10.      Related Party Transactions
Intel Corporation

21


We have been engaged in commercial transactions with Intel Corporation (Intel), a holder of our common stock, representing approximately 17% of outstanding shares as of October 31, 2018 , with the right to designate a person that our board of directors must nominate for election, or nominate for re-election, to our board of directors, including a multi‑year subscription and services agreement, and a collaboration and optimization agreement. The aggregate revenue we recognized from Intel was $1.9 million and $3.0 million for the three months ended October 31, 2018 and 2017 , respectively, and $6.7 million and $8.3 million for the nine months ended October 31, 2018 and 2017 , respectively. There was an immaterial amount in accounts receivable due from Intel as of  October 31, 2018 and no amount was included in accounts receivable from Intel as of January 31, 2018 . There was $4.3 million and $2.7 million in deferred revenue as of October 31, 2018 and January 31, 2018 , respectively.
Cloudera Foundation
In January 2017, the Cloudera Foundation, an independent non‑profit organization, was created to provide our products, skills and people, to help solve important social problems around the world. We donated 1,175,063 shares of our common stock to the Cloudera Foundation during the fourth quarter of fiscal 2017 . In conjunction with the IPO, we donated $2.4 million , or 1% of the net proceeds, in the second quarter of fiscal 2018 to fund the Cloudera Foundation’s activities. We do not control the Cloudera Foundation’s activities, and accordingly, we do not consolidate the financial statements of the Cloudera Foundation.
Other Related Parties
Certain members of our board of directors currently serve on the board of directors or as an executive of three companies that are our customers. The aggregate revenue we recognized from these customers was $0.7 million and $2.0 million for the three months ended October 31, 2018 and 2017 , respectively, and $3.4 million and $5.4 million for the nine months ended October 31, 2018 and 2017 , respectively. There was an immaterial amount in accounts receivable due from these customers as of October 31, 2018 and $1.5 million in accounts receivable due from these customers as of January 31, 2018 , respectively. There was $2.8 million and $5.2 million in deferred revenue attributable to these customers as of October 31, 2018 and January 31, 2018 , respectively.
11.      Segment Information
The results of the reportable segments are derived directly from our management reporting system and are based on our methods of internal reporting which are not necessarily in conformity with GAAP. Management measures the performance of each segment based on several metrics, including contribution margin, as defined below. Management does not use asset information to assess performance and make decisions regarding allocation of resources. Therefore, depreciation and amortization expense is not allocated among segments.
Contribution margin is used, in part, to evaluate the performance of, and allocate resources to, each of the segments. Segment contribution margin includes segment revenue less the related cost of sales excluding certain operating expenses that are not allocated to segments because they are separately managed at the consolidated corporate level. These unallocated costs include stock‑based compensation expense, amortization of acquired intangible assets, direct sales and marketing costs, research and development costs, corporate general and administrative costs, such as legal and accounting, interest income, interest expense, and other income and expense.
Financial information for each reportable segment was as follows (in thousands):
 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Revenue:
 
 
 
 
 
 
 
Subscription
$
99,698

 
$
78,105

 
$
278,720

 
$
216,762

Services
18,485

 
16,464

 
52,508

 
47,231

Total revenue
$
118,183

 
$
94,569

 
$
331,228

 
$
263,993



22


 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Contribution margin:
 
 
 
 
 
 
 
Subscription
$
88,340

 
$
66,953

 
$
242,882

 
$
184,340

Services
4,795

 
2,011

 
9,353

 
6,610

Total segment contribution margin
$
93,135

 
$
68,964

 
$
252,235

 
$
190,950

The reconciliation of segment financial information to our loss from operations is as follows (in thousands):
 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Segment contribution margin
$
93,135

 
$
68,964

 
$
252,235

 
$
190,950

Amortization of acquired intangible assets
(657
)
 
(1,038
)
 
(1,971
)
 
(2,923
)
Stock-based compensation expense
(21,890
)
 
(31,147
)
 
(67,731
)
 
(261,680
)
Corporate costs, such as research and development, corporate general and administrative and other
(96,938
)
 
(93,369
)
 
(293,154
)
 
(270,962
)
Loss from operations
$
(26,350
)
 
$
(56,590
)
 
$
(110,621
)
 
$
(344,615
)
Sales outside of the United States represented approximately 35% and 29% of our total revenue for three months ended October 31, 2018 and 2017 , respectively, and 34% and 28% of our total revenue for the nine months ended October 31, 2018 and 2017 , respectively. All revenues from customers outside of the United States are attributed to individual countries on an end‑customer basis, based on domicile of the purchasing entity, if known, or the location of the customer’s headquarters if the specific purchasing entity within the customer is unknown.
As of October 31, 2018 and January 31, 2018 , assets located outside the United States were 3% and 4% of total assets, respectively.
12.      Net Loss Per Share
The following table sets forth the calculation of basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data):

 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
Numerator:
 
 
 
 
 
 
 
Net loss
$
(26,534
)
 
$
(55,338
)
 
$
(110,950
)
 
$
(341,886
)
Denominator:
 
 
 
 
 
 
 
Weighted-average shares used in computing net loss, per share basic and diluted
152,245

 
138,506

 
149,507

 
104,551

Net loss per share, basic and diluted
$
(0.17
)
 
$
(0.40
)
 
$
(0.74
)
 
$
(3.27
)

23


The following outstanding shares of common stock equivalents were excluded from the computation of the diluted net loss per share attributable to common stockholders for the periods presented because their effect would have been anti‑dilutive (in thousands):
 
As of October 31,
 
2018
 
2017
Stock options to purchase common stock
15,684

 
21,489

Restricted stock units
17,582

 
16,917

Shares issuable pursuant to the ESPP
520

 
925

Total
33,786

 
39,331

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q. 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, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue,” and similar expressions or variations. These statements are based on the beliefs and assumptions of our management based on information currently available to management. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled “Risk Factors,” set forth in Part II, Item 1A of this Form 10-Q and in our other SEC filings. You should review the risk factors for a more complete understanding of the risks associated with an investment in our securities. We disclaim any obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. Our fiscal year end is January 31, and references throughout this Quarterly Report on Form 10-Q to a given fiscal year are to the twelve months ended on that date.
Overview
Cloudera empowers organizations to become data‑driven enterprises. We have developed the modern platform for machine learning and analytics, optimized for the cloud. We collaborate extensively with the global open source community, continuously innovate in data management technologies and leverage the latest advances in infrastructure including the public cloud for “big data” applications. Our pioneering hybrid open source software (HOSS) model incorporates the best of open source with our robust proprietary software to form an enterprise‑grade platform. This platform delivers an integrated suite of capabilities for data management, machine learning and advanced analytics, affording customers an agile, scalable and cost‑effective solution for transforming their businesses. Our platform enables organizations to use vast amounts of data from a variety of sources, including the Internet of Things, to better serve and market to their customers, design connected products and services and reduce risk through greater insight from data.
We generate revenue primarily from sales of our term‑based subscriptions of our platform generally on a per node basis, whether deployed on‑premises or in the cloud. We also offer consumption‑based pricing for cloud‑based deployments. In addition, we generate revenue from professional services and training.
We market and sell our platform to a broad range of organizations, although we focus our selling efforts on the large corporate enterprises globally as well as large public sector organizations. We target these organizations because they capture and manage the vast majority of the world’s data and operate highly complex IT environments. We market our platform primarily through a direct sales force while benefiting from business driven by our ecosystem of technology partners, resellers, OEMs, MSPs, independent software vendors and systems integrators.



We have a broad customer base that spans industries and geographies. For the three and nine months ended October 31, 2018 and 2017 , no customer accounted for more than 10% of our total revenue. We have significant revenue in the banking and financial services, technology, business services, telecommunications, public sector, consumer and retail, and healthcare and life sciences verticals, and continue to expand our penetration across many other data‑intensive industries. Sales outside of the United States represented approximately 35% and 29% of our total revenue for the three months ended October 31, 2018 and 2017 , respectively, and 34% and 28% of our total revenue for the nine months ended October 31, 2018 and 2017 , respectively.
Our business model is based on a “land and expand” strategy designed to use the initial sale as a foothold to increase revenue per customer by increasing the amount of data and number of use cases each customer runs through our platform. After an initial purchase of our platform, we work with our customers to identify new use cases that can be developed on or moved to our platform, ultimately increasing the amount of data managed on our platform as well as the number and size of our platform deployments.
Our quarterly net subscription revenue expansion rate equals:
the subscription revenue in a given quarter from end user customers that had subscription revenue in the same quarter of the prior year,
divided by
the subscription revenue attributable to that same group of customers in that prior quarter.
Our net expansion rate equals the simple arithmetic average of our quarterly net subscription revenue expansion rate for the four quarters ending with the most recently completed fiscal quarter. We have excluded Intel Corporation from our calculation of net expansion rate, as it is a related party. Our net expansion rate for the period ended October 31, 2018 was  127% as compared to 135% for the same period a year ago.
On October 3, 2018, we entered into a merger agreement with Hortonworks, a provider of enterprise-grade, global data management platforms, services and solutions that deliver actionable intelligence from any type of data for over half of the Fortune 100. Following the completion of the merger, each share of Hortonworks common stock, par value $0.0001 per share, issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive 1.305 newly issued shares of our common stock, par value $0.00005 per share. No fractional shares of our common stock will be issued in the merger, and Hortonworks stockholders will receive cash in lieu of fractional shares. We are also assuming options to purchase shares of Hortonworks common stock as well as Hortonworks restricted stock units outstanding immediately prior to the effective time of the proposed merger. We and Hortonworks plan to hold our respective stockholder meetings to vote on the proposed merger in late December 2018 with the completion of the merger to follow soon thereafter. See Note 3 to our condensed consolidated financial statements for further discussion.
Components of Results of Operations
Revenue
We generate revenue primarily from the sale of subscriptions for our platform that our customers deploy either on‑premises or in the cloud, as well as the sale of services. Subscription revenue primarily relates to term (or time‑based) subscriptions to our platform, which includes both open source and proprietary software. Our subscription arrangements are typically one to three years in length and we recognize subscription revenue ratably over the term of the subscription period. Our subscription includes internet, email and phone support, bug fixes and the right to receive unspecified software updates and upgrades released when and if available during the subscription term. Services revenue relates to professional services for the implementation and use of our subscriptions, machine learning expertise and consultation, customer training and education services and related reimbursable travel costs.
Cost of Revenue
Cost of revenue for subscriptions primarily consists of personnel costs including salaries, bonuses, travel costs, benefits and stock‑based compensation for employees providing technical support for our subscription customers,

25


allocated shared costs (including rent and information technology) and amortization of acquired intangible assets from business combinations. Cost of revenue for services primarily consists of personnel costs including salaries, bonuses, benefits and stock‑based compensation, fees to subcontractors associated with service contracts, travel costs and allocated shared costs (including rent and information technology). We expect cost of revenue to increase in absolute dollars for the remaining quarter of fiscal 2019 as compared to the respective fiscal 2018 quarter as we continue to obtain new customers and expand our relationship with existing customers. As discussed in detail below, see “Significant Impacts of Stock‑Based Compensation Expense,” during the nine months ended October 31, 2017 our initial public offering (IPO) was declared effective and the performance-based condition for the restricted stock units (RSUs) was either achieved or probable of being achieved. As such we recognized a cumulative catch‑up of stock‑based compensation expense attributable to service prior to such effective date for the RSUs. Further, upon completion of the proposed merger with Hortonworks, we expect cost of revenue to increase as compared to the respective quarters prior to the closing of the merger.
Operating Expenses
Research and Development.   Research and development expenses primarily consist of personnel costs including salaries, bonuses, travel costs, benefits and stock‑based compensation for our research and development employees, contractor fees, allocated shared costs (including rent and information technology), supplies, and depreciation of equipment associated with the continued development of our platform prior to establishment of technological feasibility and the related maintenance of the existing technology. We expect our research and development expenses to increase in absolute dollars for the remaining quarter of fiscal 2019 as compared to the respective fiscal 2018 quarter as we continue to enhance and add new technologies, features and functionality to our subscriptions. As discussed in detail below, see “Significant Impacts of Stock‑Based Compensation Expense,” during the nine months ended October 31, 2017 our IPO was declared effective and the performance-based condition for the RSUs was either achieved or probable of being achieved. As such we recognized a cumulative catch‑up of stock‑based compensation expense attributable to service prior to such effective date for RSUs. Further, upon completion of the proposed merger with Hortonworks, we expect research and development expenses to increase as compared to the respective quarters prior to the closing of the merger.
Sales and Marketing.   Sales and marketing expenses primarily consist of personnel costs including salaries, bonuses, travel costs, sales‑based incentives, benefits and stock‑based compensation for our sales and marketing employees. In addition, sales and marketing expenses also includes costs for advertising, promotional events, corporate communications, product marketing and other brand‑building activities, allocated shared costs (including rent and information technology) and amortization of acquired intangible assets from business combinations. Sales‑based incentives are expensed as incurred. We expect our sales and marketing expenses to increase in absolute dollars for the remaining quarter of fiscal 2019 as compared to the respective fiscal 2018 quarter as we continue to invest in selling and marketing activities to attract new customers and expand our relationship with existing customers. As discussed in detail below, see “Significant Impacts of Stock‑Based Compensation Expense,” during the nine months ended October 31, 2017 our IPO was declared effective and the performance-based condition for the RSUs was either achieved or probable of being achieved. As such we recognized a cumulative catch‑up of stock‑based compensation expense attributable to service prior to such effective date for RSUs. Further, upon completion of the proposed merger with Hortonworks, we expect sales and marketing expenses to increase as compared to the respective quarters prior to the closing of the merger.
General and Administrative.   General and administrative expenses primarily consist of personnel costs including salaries, bonuses, travel costs, benefits and stock‑based compensation for our executive, finance, legal, human resources, information technology and other administrative employees. In addition, general and administrative expenses include fees for third‑party professional services, including consulting, legal and accounting services and other corporate expenses, and allocated shared costs (including rent and information technology). We expect our general and administrative expenses to increase in absolute dollars for the remaining quarter of fiscal 2019 as compared to the respective fiscal 2018 quarter due to the anticipated growth of our business and related infrastructure as well as legal, accounting, insurance, investor relations and other costs associated with being a public company. Further, both immediately prior to and upon completion of the proposed merger with Hortonworks, we expect general and administrative expenses to increase as compared to the respective quarters prior to the closing of the merger.

26


Interest Income, net
Interest income primarily relates to amounts earned on our cash and cash equivalents and marketable securities.
Other Income, net
Other income, net primarily relates to foreign currency transactions, realized gains and losses on our marketable securities, and other non‑operating gains or losses.
Provision for Income Taxes
Provision for income taxes primarily consists of state and foreign income taxes. Due to cumulative losses, we maintain a valuation allowance against our deferred tax assets. We consider all available evidence, both positive and negative, in assessing the extent to which a valuation allowance should be applied against our deferred tax assets.
Significant Impacts of Stock‑Based Compensation Expense
Prior to our IPO, we have granted RSUs to our employees and members of our board of directors under our 2008 Plan. The employee RSUs vest upon the satisfaction of both a service‑based condition and a liquidity event‑related performance condition. The service‑based vesting condition for these awards is generally satisfied pro‑rata over four years.
The liquidity event‑related performance condition was achieved for the majority of our RSUs on April 27, 2017, the effective date of our IPO. We recognized stock‑based compensation expense using the accelerated attribution method with a cumulative catch‑up of stock‑based compensation expense in the amount of $181.5 million during the nine months ended October 31, 2017 attributable to service prior to such effective date.
The total stock‑based compensation expense recorded on the effective date of our initial public offering associated with the achievement of the liquidity event‑related performance condition was as follows (in thousands):
Cost of revenue – subscription
$
15,292

Cost of revenue – services
19,695

Research and development
65,250

Sales and marketing
58,219

General and administrative
23,080

Total stock‑based compensation expense
$
181,536



27


Results of Operations
The following table sets forth our results of operations for the periods indicated:
 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
 
(in thousands)
Revenue:
 
 
 
 
 
 
 
Subscription
$
99,698

 
$
78,105

 
$
278,720

 
$
216,762

Services
18,485

 
16,464

 
52,508

 
47,231

Total revenue
118,183

 
94,569

 
331,228

 
263,993

Cost of revenue: (1) (2)
 
 
 
 
 
 
 
Subscription
13,996

 
14,486

 
44,764

 
56,173

Services
15,980

 
18,640

 
50,695

 
69,035

Total cost of revenue
29,976

 
33,126

 
95,459

 
125,208

Gross profit
88,207

 
61,443

 
235,769

 
138,785

Operating expenses: (1) (2)
 
 
 
 
 
 
 
Research and development
37,563

 
38,095

 
121,027

 
176,770

Sales and marketing
54,927

 
64,061

 
169,870

 
236,639

General and administrative
22,067

 
15,877

 
55,493

 
69,991

Total operating expenses
114,557

 
118,033

 
346,390

 
483,400

Loss from operations
(26,350
)
 
(56,590
)
 
(110,621
)
 
(344,615
)
Interest income, net
2,440

 
1,501

 
6,420

 
3,590

Other income (expense), net
(1,126
)
 
(490
)
 
(3,154
)
 
349

Net loss before benefit from (provision for) income taxes
(25,036
)
 
(55,579
)
 
(107,355
)
 
(340,676
)
Benefit from (provision for) income taxes
(1,498
)
 
241

 
(3,595
)
 
(1,210
)
Net loss
$
(26,534
)
 
$
(55,338
)
 
$
(110,950
)
 
$
(341,886
)

(1)
Amounts include stock‑based compensation expense as follows:
 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
 
(in thousands)
Cost of revenue – subscription
$
2,016

 
$
2,750

 
$
7,060

 
$
22,143

Cost of revenue – services
2,290

 
4,187

 
7,540

 
28,414

Research and development
7,805

 
9,110

 
26,002

 
90,139

Sales and marketing
5,504

 
10,070

 
14,281

 
82,748

General and administrative
4,275

 
5,030

 
12,848

 
38,236

Total stock-based compensation expense
$
21,890

 
$
31,147

 
$
67,731

 
$
261,680


28


(2)
Amounts include amortization of acquired intangible assets as follows:

 
Three Months Ended October 31,
 
Nine Months Ended October 31,
 
2018
 
2017
 
2018
 
2017
 
(in thousands)