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Employee Incentive Plans | 12 Months Ended
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Jan. 31, 2025
Share-Based Payment Arrangement [Abstract] |
Employee Incentive Plans | Employee Incentive Plans Equity Incentive Plans The Company has two equity incentive plans: the 2009 Stock Plan (“2009 Plan”) and the 2017 Equity Incentive Plan (“2017 Plan”). All shares that remain available for future grants are under the 2017 Plan. As of January 31, 2025, options to purchase 811,267 shares of Class A common stock and 1,387,313 shares of Class B common stock remained outstanding. The Company’s equity incentive plans provide for granting stock options, RSUs, restricted stock awards to employees, consultants, officers and directors and RSUs with market-based vesting conditions to certain executives. In addition, the Company offers an ESPP to eligible employees. Stock-based compensation expense by award type was as follows:
|  |  | Year Ended January 31,
|  |  |  |  | 2025 |  | 2024 |  | 2023
|  |  |  |  | (dollars in millions)
Stock options |  |  |  |  | $ | 14 |  |  | $ | 45 |  |  | $ | 82 |
RSUs |  |  |  |  | 500 |  |  | 502 |  |  | 464 |
ESPP |  |  |  |  | 17 |  |  | 26 |  |  | 19 |
Restricted stock awards |  |  |  |  | 34 |  |  | 111 |  |  | 112 |
Total |  |  |  |  | $ | 565 |  |  | $ | 684 |  |  | $ | 677 |
Stock-based compensation expense was recorded in the following cost and expense categories in the consolidated statements of operations:
| Year Ended January 31,
| 2025 |  | 2024 |  | 2023
| (dollars in millions)
Cost of revenue: |  |  |  |  |
Subscription | $ | 82 |  |  | $ | 75 |  |  | $ | 69 |
Professional services and other | 12 |  |  | 15 |  |  | 14 |
Research and development | 216 |  |  | 277 |  |  | 275 |
Sales and marketing | 131 |  |  | 156 |  |  | 159 |
General and administrative | 124 |  |  | 161 |  |  | 160 |
Total | $ | 565 |  |  | $ | 684 |  |  | $ | 677 |
Stock Options Options issued under the Plan generally are exercisable for periods not to exceed ten years and generally vest over four years with 25% vesting after one year and with the remainder vesting monthly thereafter in equal installments. Shares offered under the Plan may be: (i) authorized but unissued shares or (ii) treasury shares. A summary of stock option activity and related information was as follows:
| Number of Options (in thousands) |  | Weighted-Average Exercise Price |  | Weighted-Average Remaining Contractual Term (Years) |  | Aggregate Intrinsic Value (in millions)
Outstanding as of January 31, 2024 | 5,038 |  |  | $ | 32.54 |  |  | 3.1 |  | $ | 320 |
Exercised | (2,792) |  |  | 9.80 |  |  |  |  |
Expired | (43) |  |  | 206.35 |  |  |  |  |
Forfeited | (4) |  |  | 47.82 |  |  |  |  |
Outstanding as of January 31, 2025 | 2,199 |  |  | $ | 57.98 |  |  | 2.8 |  | $ | 137 |
As of January 31, 2025 |  |  |  |  |  |  |
Vested and expected to vest | 2,199 |  |  | $ | 57.98 |  |  | 2.8 |  | $ | 137 |
Vested and exercisable | 2,192 |  |  | $ | 57.33 |  |  | 2.8 |  | $ | 137 |
No options were granted during fiscal 2025, 2024 and 2023. The total grant-date fair value of stock options vested was $16 million, $48 million and $104 million during fiscal 2025, 2024 and 2023, respectively. The intrinsic value of the options exercised, which represents the difference between the fair market value of the Company’s common stock on the date of exercise and the exercise price of each option, was $213 million, $57 million and $108 million during fiscal 2025, 2024 and 2023, respectively. Windfall tax benefits realized upon exercise of stock options were $47 million during fiscal 2025, while no windfall tax benefits were realized in fiscal years 2024 and 2023. Restricted Stock Units A summary of RSU activity (inclusive of market-based RSUs) and related information was as follows:
| Number of RSUs (in thousands) |  | Weighted-Average Grant Date Fair Value Per Share
Outstanding as of January 31, 2024 | 9,080 |  |  | $ | 111.03 |
Granted | 4,859 |  |  | 96.98 |
Vested | (4,361) |  |  | 114.57 |
Forfeited | (1,780) |  |  | 108.11 |
Outstanding as of January 31, 2025 | 7,798 |  |  | $ | 100.97 |
The Company granted 4,858,824 RSUs with an aggregate fair value of $471 million during fiscal 2025. As of January 31, 2025 and 2024, there was a total of $672 million and $898 million, respectively, of unrecognized stock-based compensation expense related to unvested RSUs, which is being recognized over a weighted-average period of 1.8 years, based on vesting under the award service conditions. The total fair value of RSUs vested during fiscal 2025, 2024 and 2023 was $382 million, $335 million and $229 million, respectively. During the first quarter of fiscal 2025, the Company began funding withholding taxes due upon the vesting of employee RSUs in certain jurisdictions by net share settlement, rather than its previous approach of selling shares of the Company’s common stock. The amount of withholding taxes related to net share settlement of employee RSUs is reflected as (i) a reduction to additional paid-in-capital, and (ii) cash outflows for financing activities when the payments are made. The shares withheld by the Company as a result of the net share settlement of RSUs are not considered issued and outstanding, and do not impact the calculation of basic net income (loss) per share attributable to the Class A and Class B common stockholders. Market-based Restricted Stock Units In March 2022, the Company granted market-based RSUs to certain members of management with an average grant date fair value of $244.73. The target number of market-based RSUs granted was 58,150. One-third of these market-based RSUs vest over each of a one-, two- and three-year performance period, each starting on February 1, 2022. In March 2023, the Company granted market-based RSUs to certain members of management with an average grant date fair value of $149.78. The target number of market-based RSUs granted was 192,843. One-third of these market-based RSUs vest over each of a one-, two- and three-year performance period, each starting on February 1, 2023. In March 2024, the Company granted market-based RSUs to certain members of management with an average grant date fair value of $182.15. The target number of market-based RSUs granted was 183,595. One-third of these market-based RSUs vest over each of a one-, two- and three-year performance period, each starting on February 1, 2024. For each granted market-based RSU award, the number of shares that can be earned ranges from 0% to 200% of the target number of shares based on the relative performance of the per share price of the Company’s common stock as compared to the Nasdaq Composite Index over the respective performance periods and subject to continuous employment through the vesting dates. The average grant date fair value per target market-based RSU is determined using a Monte Carlo simulation approach. Compensation expense for awards with market conditions is recognized over the service period using the accelerated attribution method and is not reversed if the market condition is not met. Restricted Stock Awards As of January 31, 2025, there was $15 million of unrecognized stock-based compensation expense related to unvested restricted stock awards, which is being recognized over a weighted-average period of 2.1 years based on vesting under the award service conditions. Employee Stock Purchase Plan (ESPP) The ESPP provides for 12-month offering periods beginning June 21 and December 21 of each year, and each offering period consists of up to two six-month purchase periods. The ESPP contains a reset provision under which the offering period resets if the fair market value of the Company’s common stock on the purchase date is less than the fair market value on the offering date. The Company estimated the fair value of ESPP purchase rights using a Black-Scholes option pricing model with the following assumptions:
|  | Year Ended January 31,
|  | 2025 |  | 2024 |  | 2023
Expected volatility |  | 42% - 44% |  | 46% - 74% |  | 63% - 90%
Expected term (in years) |  | 0.5 - 1.0 |  | 0.5 - 1.0 |  | 0.5 - 1.0
Risk-free interest rate |  | 4.26% - 5.36% |  | 4.84% - 5.41% |  | 2.46% - 4.67%
Expected dividend yield |  | — |  | — |  | —
During fiscal 2025, the Company's employees purchased 586,149 shares of its Class A common stock under the ESPP. The shares were purchased at a weighted-average purchase price of $71.68 per share, with proceeds of $42 million. During fiscal 2024, the Company's employees purchased 793,739 shares of its Class A common stock under the ESPP. The shares were purchased at a weighted-average purchase price of $57.84 per share, with proceeds of $46 million. As of January 31, 2025 and January 31, 2024, there was $15 million and $16 million, respectively, of unrecognized stock-based compensation expense related to the ESPP which is being recognized over a weighted-average vesting period of 0.6 years. Employee Defined Contribution Plan The Company has a qualified defined contribution plan under Section 401(k) of the Internal Revenue Code covering eligible employees. A portion of employee contributions are matched up to a fixed maximum dollar amount per year per employee. During fiscal 2025, 2024 and 2023, matching contributions related to the plan were $18 million, $19 million and $21 million, respectively.

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