Income Taxes |
9 Months Ended |
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Oct. 31, 2024 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The provision for income taxes for interim tax periods is generally determined using an estimate of the Company’s annual effective tax rate, excluding jurisdictions for which no tax benefit can be recognized due to valuation allowances, and adjusted for discrete tax items in the period. Each quarter the Company updates its estimate of the annual effective tax rate and makes a cumulative adjustment if the estimated annual tax rate has changed. The Company’s effective tax rate generally differs from the U.S. federal statutory tax rate primarily due to valuation allowances on deferred tax assets, U.S. Base Erosion and Anti-Abuse Tax (“BEAT”), state taxes, and non-deductible share-based compensation offset by tax credits and Foreign Derived Intangible Income (“FDII”) deductions. The Company recorded a provision for income taxes of $3.6 million and $3.2 million for the three months ended October 31, 2024 and 2023, respectively, and $1.1 million and $8.6 million for the nine months ended October 31, 2024 and 2023, respectively. The provision is primarily attributable to BEAT, income taxes in foreign jurisdictions, and state income taxes. The Tax Cuts and Jobs Act of 2017 amended Internal Revenue Code Section 174 to require that specific research and experimental expenditures be capitalized and amortized over five years for U.S. activities and fifteen years for foreign activities beginning in fiscal year 2023. As a result, the Company has been utilizing some of its federal and state tax attributes and incurring cash taxes due to this provision.
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