Income Taxes |
3 Months Ended |
|---|---|
Apr. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes The Company recognized income tax expense of $21.1 million and $7.7 million for the three months ended April 30, 2025 and April 30, 2024, respectively. The tax expense for the three months ended April 30, 2025 and April 30, 2024 was primarily attributable to income taxes on earnings and withholding taxes related to customer payments in certain foreign jurisdictions in which the Company conducts business. The Company’s effective tax rates of (23.5)% and 14.2% for the three months ended April 30, 2025 and April 30, 2024, respectively, are primarily due to income taxes in U.S. and foreign jurisdictions, withholding taxes related to customer payments in certain foreign jurisdictions in which the Company conducts business, and valuation allowance in the U.S. and certain foreign jurisdictions where the Company does not benefit from losses and tax credits. Total gross unrecognized tax benefits were $123.9 million and $117.5 million as of April 30, 2025 and January 31, 2025, respectively, which is primarily attributable to research and development credits. As of April 30, 2025 and January 31, 2025, approximately $55.4 million and $54.8 million, respectively of unrecognized tax benefits, which, if recognized, would affect the Company’s effective tax rate due to the full valuation allowance. The Company’s policy is to classify interest and penalties related to unrecognized tax benefits as part of the income tax provision in the condensed consolidated statements of operations. The Company had incurred $3.7 million and $3.0 million of interest and penalties related to unrecognized tax benefits as of April 30, 2025 and January 31, 2025. In accordance with the guidance on the accounting for uncertainty in income taxes, for all U.S. and other tax jurisdictions, the Company recognizes potential liabilities for anticipated tax audit issues based on the Company’s estimate of whether, and the extent to which, additional taxes and interest will be due. The Company files income tax returns in the U.S. federal, and various state jurisdictions, as well as various foreign jurisdictions. Tax years 2011 and onwards remain subject to examination by taxing authorities. If the Company’s estimate of income tax liabilities proves to be less than the ultimate assessment, a further charge to expense would be required. If events occur and the payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when the Company determines the liabilities are no longer necessary. The Company includes interest and penalties related to unrecognized tax benefits within the provision for income taxes in the condensed consolidated statements of operations. Accrued interest and penalties are included within other liabilities, noncurrent on the condensed consolidated balance sheets. The Company maintains a full valuation allowance on U.S. federal and state and certain foreign deferred tax assets, including net operating loss carryforwards and tax credits, which the Company has determined are not realizable on a more-likely-than-not basis. The Company regularly evaluates the need for a valuation allowance.
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