Revenue increased 46% year-over-year
ARR up 47% year-over-year
SentinelOne, Inc. (NYSE: S) today announced financial results
for the second quarter of fiscal year 2024 ended July 31, 2023.
“Our second quarter performance exceeded our expectations across
the board. I’m proud of the resilience, dedication, and execution
of our teams. We’re delivering industry-leading margin improvement
while maintaining strong growth, and steadily approaching positive
free cash flow generation,” said Tomer Weingarten, CEO of
SentinelOne. “From the beginning, we designed our AI-powered
Singularity platform to deliver autonomous enterprise security. Our
approach is helping enterprises consolidate security spend and
simplify security operations while getting best-in-class autonomous
protection. Our focus on superior technology continues to deliver
share gains and strong growth.”
“Once again, we delivered strong top line growth and substantial
margin improvement. Our gross margin reached a new record, we
achieved our eighth consecutive quarter of more than 25 percentage
points of year-over-year operating margin improvement, and improved
cash flow margins by 55 percentage points year-over-year,” said
Dave Bernhardt, CFO of SentinelOne. “Our teams are executing well
and our competitive position remains strong. We’re raising our top
and bottom line expectations for the fiscal year ‘24.”
Letter to Shareholders
We have also published a letter to shareholders on the Investor
Relations section of our website at investors.sentinelone.com. The
letter provides further discussion of our results for the second
quarter of fiscal year 2024 as well as the financial outlook for
our fiscal third quarter and full fiscal year 2024.
Second Quarter Fiscal Year 2024 Highlights (All metrics
are compared to the second quarter of fiscal year 2023 unless
otherwise noted)
- Total revenue increased 46% to $149.4 million, compared
to $102.5 million.
- Annualized recurring revenue (ARR) increased 47% to
$612.2 million as of July 31, 2023.
- Total customer count grew approximately 30% to over
11,000 customers as of July 31, 2023. Customers with ARR of
$100,000 or more grew 37% to 994 as of July 31, 2023. Dollar-based
net revenue retention rate (NRR) exceeded 115%.
- Gross margin: GAAP gross margin was 70%, compared to
65%. Non-GAAP gross margin was 77%, compared to 72%.
- Operating margin: GAAP operating margin was (67)%,
compared to (106)%. Non-GAAP operating margin was (22)%, compared
to (57)%.
- Free cash flow margin: Free cash flow margin was (10)%,
55 percentage points higher compared to (65)%.
- Cash, cash equivalents, and investments were $1.1
billion as of July 31, 2023.
Financial Outlook
We are providing the following guidance for the third quarter of
the fiscal year 2024 (ending October 31, 2023), and for the fiscal
year 2024 (ending January 31, 2024).
Q3FY24
Guidance
Full FY2024
Guidance
Revenue
$156 million
$605 million
Non-GAAP gross margin
76
%
76
%
Non-GAAP operating margin
(22
)%
(25
)%
These statements are forward-looking and actual results may
differ materially as a result of many factors. Refer to the below
for information on the factors that could cause our actual results
to differ materially from these forward-looking statements.
Guidance for non-GAAP financial measures excludes stock-based
compensation expense, employer payroll tax on employee stock
transactions, amortization expense of acquired intangible assets,
acquisition-related compensation costs, restructuring charges, and
gain on strategic investments. We have not provided the most
directly comparable GAAP measures because certain items are out of
our control or cannot be reasonably predicted. Accordingly, a
reconciliation of non-GAAP gross margin and non-GAAP operating
margin is not available without unreasonable effort.
Webcast Information
We will host a live audio webcast for analysts and investors to
discuss our earnings results for the second quarter of fiscal year
2024 and outlook for the third quarter of fiscal year 2024 and the
full fiscal year 2024 today, August 31, 2023, at 2:00 p.m. Pacific
Time (5:00 p.m. Eastern Time). The live webcast and a recording of
the event will be available on the Investor Relations section of
our website at investors.sentinelone.com.
We have used, and intend to continue to use, the Investor
Relations section of our website at investors.sentinelone.com as a
means of disclosing material nonpublic information and for
complying with our disclosure obligations under Regulation FD.
Forward-Looking Statements
This press release 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, which statements involve risks and uncertainties,
including but not limited to statements regarding our future
growth, execution, competitive position, and future financial and
operating performance, including our financial outlook for the
third quarter of fiscal year 2024 and our full fiscal year 2024,
including non-GAAP gross profit and non-GAAP operating margin;
progress towards our long-term profitability targets; and general
market trends. The words “believe,” “may,” “will,” “potentially,”
“estimate,” “continue,” “anticipate,” “intend,” “could,” “would,”
“project,” “target,” “plan,” “expect,” or the negative of these
terms and similar expressions are intended to identify
forward-looking statements. However, not all forward-looking
statements contain these identifying words.
There are a significant number of factors that could cause our
actual results to differ materially from statements made in this
press release, including but not limited to: our limited operating
history; our history of losses; intense competition in the market
we compete in; fluctuations in our operating results; actual or
perceived network or security incidents against us; our ability to
successfully integrate acquisitions and strategic investments;
actual or perceived defects, errors or vulnerabilities in our
platform; risks associated with managing our rapid growth; general
market, political, economic, and business conditions, including
those related to declining global macroeconomic condition, rising
interest rates, supply chain disruptions and inflation, labor
shortages, recent banking sector issues, and, geopolitical
uncertainty, including the effects of the ongoing conflict in
Ukraine and the judicial reform in Israel; our ability to attract
new and retain existing customers, or renew and expand our
relationships with them; the ability of our platform to effectively
interoperate within our customers" IT infrastructure; disruptions
or other business interruptions that affect the availability of our
platform; the failure to timely develop and achieve market
acceptance of new products and subscriptions as well as existing
products, subscriptions and support offerings; rapidly evolving
technological developments in the market for security products and
subscription and support offerings; length of sales cycles; and
risks of securities class action litigation.
Additional risks and uncertainties that could affect our
financial results are included under the captions “Risk Factors”
and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” set forth in our filings and reports
with the Securities and Exchange Commission (“SEC”), including our
most recently filed Annual Report on Form 10-K, dated March 29,
2023, subsequent Quarterly Reports on Form 10-Q and other filings
and reports that we may file from time to time with the SEC, copies
of which are available on our website at investors.sentinelone.com
and on the SEC’s website at www.sec.gov.
You should not rely on these forward-looking statements, as
actual outcomes and results may differ materially from those
contemplated by these forward-looking statements as a result of
such risks and uncertainties. All forward-looking statements in
this press release are based on information available to us as of
the date hereof, and were based on current expectations, estimates,
forecasts, and projections as well as the beliefs and assumptions
of management. We do not assume any obligation to update the
forward-looking statements provided to reflect events that occur or
circumstances that exist after the date of this press release or to
reflect new information or the occurrence of unexpected events,
except as required by law. We may not actually achieve the plans,
intentions, or expectations disclosed in our forward-looking
statements, and you should not place undue reliance on our
forward-looking statements.
Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP,
we believe the following non-GAAP measures are useful in evaluating
our operating performance. We use the following non-GAAP financial
information to evaluate our ongoing operations and for internal
planning and forecasting purposes. We believe that non-GAAP
financial information, when taken collectively, with the financial
information presented in accordance with GAAP, may be helpful to
investors because it provides consistency and comparability with
past financial performance. However, non-GAAP financial information
is presented for supplemental informational purposes only, has
limitations as an analytical tool, and should not be considered in
isolation or as a substitute for financial information presented in
accordance with GAAP.
Other companies, including companies in our industry, may
calculate similarly titled non-GAAP measures differently or may use
other measures to evaluate their performance, all of which could
reduce the usefulness of our non-GAAP financial measures as tools
for comparison. In addition, the utility of free cash flow as a
measure of our liquidity is limited as it does not represent the
total increase or decrease in our cash balance for a given
period.
Reconciliations between non-GAAP financial measures to the most
directly comparable financial measure stated in accordance with
GAAP are contained below. Investors are encouraged to review the
related GAAP financial measures and the reconciliation of these
non-GAAP financial measures to their most directly comparable GAAP
financial measures and not rely on any single financial measure to
evaluate our business.
As presented in the “Reconciliation of GAAP to Non-GAAP
Financial Information” table below, each of the non-GAAP financial
measures excludes one or more of the following items:
Stock-based compensation expense
Stock-based compensation expense is a non-cash expense that
varies in amount from period to period and is dependent on market
forces that are often beyond our control. As a result, management
excludes this item from our internal operating forecasts and
models. Management believes that non-GAAP measures adjusted for
stock-based compensation expense provide investors with a basis to
measure our core performance against the performance of other
companies without the variability created by stock-based
compensation as a result of the variety of equity awards used by
other companies and the varying methodologies and assumptions
used.
Employer payroll tax on employee stock transactions
Employer payroll tax expense related to employee stock
transactions are tied to the vesting or exercise of underlying
equity awards and the price of our common stock at the time of
vesting, which varies in amount from period to period and is
dependent on market forces that are often beyond our control. As a
result, management excludes this item from our internal operating
forecasts and models. Management believes that non-GAAP measures
adjusted for employer payroll taxes on employee stock transactions
provide investors with a basis to measure our core performance
against the performance of other companies without the variability
created by employer payroll taxes on employee stock transactions as
a result of the stock price at the time of employee exercise.
Amortization of acquired intangible assets
Amortization of acquired intangible assets expense are tied to
the intangible assets that were acquired in conjunction with
acquisitions, which results in non‑cash expenses that may not
otherwise have been incurred. Management believes excluding the
expense associated with intangible assets from non-GAAP measures
allows for a more accurate assessment of our ongoing operations and
provides investors with a better comparison of period-over-period
operating results.
Acquisition-related compensation costs
Acquisition-related compensation costs include cash-based
compensation expense resulting from the employment retention of
certain employees established in accordance with the terms of the
acquisition of Attivo Networks, Inc. in May 2022 (the Attivo
acquisition). Acquisition-related cash-based compensation costs
have been excluded as they were specifically negotiated as part of
the Attivo acquisition in order to retain such employees and relate
to cash compensation that was made either in lieu of stock-based
compensation or where the grant of stock-based compensation awards
was not practicable. In most cases, these acquisition-related
compensation costs are not factored into management's evaluation of
potential acquisitions or our performance after completion of
acquisitions, because they are not related to our core operating
performance. In addition, the frequency and amount of such charges
can vary significantly based on the size and timing of acquisitions
and the maturities of the businesses being acquired. Excluding
acquisition-related compensation costs from non-GAAP measures
provides investors with a basis to compare our results against
those of other companies without the variability caused by purchase
accounting.
Restructuring charges
Restructuring charges primarily relate to severance payments,
employee benefits, stock based compensation, and inventory
write-offs. These restructuring charges are excluded from non-GAAP
financial measures because they are the result of discrete events
that are not considered core-operating activities. We believe that
it is appropriate to exclude restructuring charges from non-GAAP
financial measures because it enables the comparison of
period-over-period operating results from continuing
operations.
Gain on strategic investments
Gain on strategic investments relates to gains recognized on the
disposition of strategic investments. These gains are excluded from
non-GAAP financial measures because the terms of each transaction
can vary significantly and are unique to each transaction. These
gains are the result of discrete events that are not considered
core-operating activities. We believe that it is appropriate to
exclude gains from strategic investments from non-GAAP financial
measures because it enables the comparison of period-over-period
net income.
Non-GAAP Cost of Revenue, Non-GAAP Gross Profit, Non-GAAP
Gross Margin, Non-GAAP Loss from Operations, Non-GAAP Operating
Margin, Non-GAAP Net Loss and Non-GAAP Net Loss Per Share
We define these non-GAAP financial measures as their respective
GAAP measures, excluding the expenses referenced above. We use
these non-GAAP financial measures as part of our overall assessment
of our performance, including the preparation of our annual
operating budget and quarterly forecasts, to evaluate the
effectiveness of our business strategies, and to communicate with
our board of directors concerning our financial performance.
Free Cash Flow
We define free cash flow as cash used in operating activities
less purchases of property and equipment and capitalized
internal-use software costs. We believe free cash flow is a useful
indicator of liquidity that provides our management, board of
directors, and investors with information about our future ability
to generate or use cash to enhance the strength of our balance
sheet and further invest in our business and pursue potential
strategic initiatives.
Key Business Metrics
We monitor the following key metrics to help us evaluate our
business, identify trends affecting our business, formulate
business plans, and make strategic decisions.
Annualized Recurring Revenue
We believe that ARR is a key operating metric to measure our
business because it is driven by our ability to acquire new
subscription and capacity customers and to maintain and expand our
relationship with existing customers. ARR represents the annualized
revenue run rate of our subscription and capacity contracts at the
end of a reporting period, assuming contracts are renewed on their
existing terms for customers that are under contracts with us. ARR
is not a forecast of future revenue, which can be impacted by
contract start and end dates and renewal rates. As discussed above,
in the first quarter of fiscal year 2024 we adjusted our historical
ARR (i) due to a change in the methodology for reflecting
consumption and usage based agreements as part of ARR to reflect
committed contract values as opposed to based on consumption and
usage as a result of expected lower usage and consumption trends
resulting from the current macro environment and (ii) to correct
some historical recording inaccuracies relating to ARR on certain
contracts that were discovered as part of our review of ARR in the
first quarter of fiscal year 2024. The adjustment to ARR did not
impact historical total bookings or revenue.
Customers with ARR of $100,000 or More
We believe that our ability to increase the number of customers
with ARR of $100,000 or more is an indicator of our market
penetration and strategic demand for our platform. We define a
customer as an entity that has an active subscription for access to
our platform. We count Managed Service Providers, Managed Security
Service Providers, Managed Detection & Response firms, and
Original Equipment Manufacturers, who may purchase our products on
behalf of multiple companies, as a single customer. We do not count
our reseller or distributor channel partners as customers. Based on
the adjustments to ARR described above, customers with ARR of
$100,000 or more for the prior periods in fiscal year 2023
presented above has been adjusted based on the same percentage
adjustment rate identified in the first quarter of fiscal year
2024.
Dollar-Based Net Retention Rate (NRR)
We believe that our ability to retain and expand our revenue
generated from our existing customers is an indicator of the
long-term value of our customer relationships and our potential
future business opportunities. Dollar-based net retention rate
measures the percentage change in our ARR derived from our customer
base at a point in time. To calculate these metrics, we first
determine Prior Period ARR, which is ARR from the population of our
customers as of 12 months prior to the end of a particular
reporting period. We calculate Net Retention ARR as the total ARR
at the end of a particular reporting period from the set of
customers that is used to determine Prior Period ARR. Net Retention
ARR includes any expansion, and is net of contraction and attrition
associated with that set of customers. NRR is the quotient obtained
by dividing Net Retention ARR by Prior Period ARR.
Source: SentinelOne NYSE: S Category: Investors
SENTINELONE, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands)
(unaudited)
July 31,
January 31,
2023
2023
Assets
Current assets:
Cash and cash equivalents
$
133,065
$
137,941
Short-term investments
598,531
485,584
Accounts receivable, net
124,525
151,492
Deferred contract acquisition costs,
current
42,825
37,904
Prepaid expenses and other current
assets
95,815
101,812
Total current assets
994,761
914,733
Property and equipment, net
43,878
38,741
Operating lease right-of-use assets
22,015
23,564
Long-term investments
410,307
535,422
Deferred contract acquisition costs,
non-current
58,624
55,536
Intangible assets, net
131,127
145,093
Goodwill
540,308
540,308
Other assets
6,177
5,516
Total assets
$
2,207,197
$
2,258,913
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
13,840
$
11,214
Accrued liabilities
104,483
100,015
Accrued payroll and benefits
50,393
54,955
Operating lease liabilities, current
4,637
3,895
Deferred revenue, current
325,019
303,200
Total current liabilities
498,372
473,279
Deferred revenue, non-current
96,343
103,062
Operating lease liabilities,
non-current
20,519
23,079
Other liabilities
2,644
2,788
Total liabilities
617,878
602,208
Stockholders’ equity:
Class A common stock
24
21
Class B common stock
5
8
Additional paid-in capital
2,795,019
2,663,394
Accumulated other comprehensive loss
(8,971
)
(6,367
)
Accumulated deficit
(1,196,758
)
(1,000,351
)
Total stockholders’ equity
1,589,319
1,656,705
Total liabilities and stockholders’
equity
$
2,207,197
$
2,258,913
SENTINELONE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended July
31,
Six Months Ended July
31,
2023
2022
2023
2022
Revenue
$
149,421
$
102,505
$
282,814
$
180,760
Cost of revenue(1)
44,667
36,261
87,250
63,400
Gross profit
104,754
66,244
195,564
117,360
Operating expenses:
Research and development(1)
54,161
54,989
109,424
100,870
Sales and marketing(1)
98,262
79,000
197,433
139,641
General and administrative(1)
48,433
40,447
100,186
75,337
Restructuring(1)
4,255
—
4,255
—
Total operating expenses
205,111
174,436
411,298
315,848
Loss from operations
(100,357
)
(108,192
)
(215,734
)
(198,488
)
Interest income
11,489
3,222
22,024
4,309
Interest expense
(605
)
(607
)
(1,212
)
(612
)
Other expense, net
1,409
427
1,050
136
Loss before income taxes
(88,064
)
(105,150
)
(193,872
)
(194,655
)
Provision (benefit) for income taxes
1,474
(8,844
)
2,535
(8,515
)
Net loss
$
(89,538
)
$
(96,306
)
$
(196,407
)
$
(186,140
)
Net loss per share attributable to Class A
and Class B common stockholders, basic and diluted
$
(0.31
)
$
(0.35
)
$
(0.68
)
$
(0.68
)
Weighted-average shares used in computing
net loss per share attributable to Class A and Class B common
stockholders, basic and diluted
293,170,401
277,417,227
290,775,910
273,424,105
(1) Includes stock-based compensation
expense as follows:
Cost of revenue
$
4,068
$
2,399
$
8,241
$
4,247
Research and development
15,452
13,495
30,242
23,958
Sales and marketing
13,681
9,715
26,277
16,811
General and administrative
20,705
15,392
44,695
27,615
Restructuring
(1,060
)
—
(1,060
)
—
Total stock-based compensation expense
$
52,846
$
41,001
$
108,395
$
72,631
SENTINELONE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Six Months Ended July
31,
2023
2022
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss
$
(196,407
)
$
(186,140
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
18,623
10,794
Amortization of deferred contract
acquisition costs
22,263
32,532
Non-cash operating lease costs
1,973
1,609
Stock-based compensation expense
108,395
72,631
Loss on investments, accretion of
discounts, and amortization of premiums on investments, net
(11,089
)
(1,167
)
Gain on strategic investments
(2,000
)
—
Other
775
(452
)
Changes in operating assets and
liabilities, net of effects of acquisition
Accounts receivable
27,926
480
Prepaid expenses and other assets
6,291
(9,151
)
Deferred contract acquisition costs
(30,272
)
(39,287
)
Accounts payable
1,044
6,094
Accrued liabilities
4,386
4,148
Accrued payroll and benefits
(4,393
)
(23,669
)
Operating lease liabilities
(2,434
)
(2,737
)
Deferred revenue
15,101
31,285
Other liabilities
(144
)
(8,447
)
Net cash used in operating activities
(39,962
)
(111,477
)
CASH FLOW FROM INVESTING ACTIVITIES:
Purchases of property and equipment
(494
)
(4,101
)
Purchases of intangible assets
(213
)
(194
)
Capitalization of internal-use
software
(6,165
)
(6,028
)
Purchases of investments
(350,416
)
(1,243,594
)
Sales and maturities of investments
371,996
291,845
Cash paid for acquisition, net of cash and
restricted cash acquired
—
(281,032
)
Net cash provided by (used in) investing
activities
14,708
(1,243,104
)
CASH FLOW FROM FINANCING ACTIVITIES:
Payments of deferred offering costs
—
(186
)
Proceeds from exercise of stock
options
13,845
8,382
Proceeds from issuance of common stock
under the employee stock purchase plan
6,416
8,682
Net cash provided by financing
activities
20,261
16,878
NET CHANGE IN CASH, CASH EQUIVALENTS, AND
RESTRICTED CASH
(4,993
)
(1,337,703
)
CASH, CASH EQUIVALENTS, AND RESTRICTED
CASH–Beginning of period
202,406
1,672,051
CASH, CASH EQUIVALENTS, AND RESTRICTED
CASH–End of period
$
197,413
$
334,348
SENTINELONE, INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL INFORMATION
(in thousands, except
percentages and per share data)
(unaudited)
Three Months Ended July
31,
Six Months Ended July
31,
2023
2022
2023
2022
Cost of revenue reconciliation:
GAAP cost of revenue
$
44,667
$
36,261
$
87,250
$
63,400
Stock-based compensation expense
(4,068
)
(2,399
)
(8,241
)
(4,247
)
Employer payroll tax on employee stock
transactions
(76
)
(35
)
(126
)
(36
)
Amortization of acquired intangible
assets
(5,139
)
(5,139
)
(10,111
)
(5,679
)
Acquisition-related compensation
(128
)
(148
)
(251
)
(148
)
Inventory write-offs due to
restructuring
(720
)
—
(720
)
$
—
Non-GAAP cost of revenue
$
34,536
$
28,540
$
67,801
$
53,290
Gross profit reconciliation:
GAAP gross profit
$
104,754
$
66,244
$
195,564
$
117,360
Stock-based compensation expense
4,068
2,399
8,241
4,247
Employer payroll tax on employee stock
transactions
76
35
126
36
Amortization of acquired intangible
assets
5,139
5,139
10,111
5,679
Acquisition-related compensation
128
148
251
148
Inventory write-offs due to
restructuring
720
—
720
—
Non-GAAP gross profit
$
114,885
$
73,965
$
215,013
$
127,470
Gross margin reconciliation:
GAAP gross margin
70
%
65
%
69
%
65
%
Stock-based compensation expense
3
%
2
%
3
%
2
%
Employer payroll tax on employee stock
transactions
—
%
—
%
—
%
—
%
Amortization of acquired intangible
assets
4
%
5
%
4
%
3
%
Acquisition-related compensation
—
%
—
%
—
%
—
%
Inventory write-offs due to
restructuring
—
%
—
%
—
%
—
%
Non-GAAP gross margin
77
%
72
%
76
%
70
%
Research and development expense
reconciliation:
GAAP research and development expense
$
54,161
$
54,989
$
109,424
$
100,870
Stock-based compensation expense
(15,452
)
(13,495
)
(30,242
)
(23,958
)
Employer payroll tax on employee stock
transactions
(149
)
(97
)
(351
)
(135
)
Acquisition-related compensation
(298
)
(359
)
(623
)
(359
)
Non-GAAP research and development
expense
$
38,262
$
41,038
$
78,208
$
76,418
Sales and marketing expense
reconciliation:
GAAP sales and marketing expense
$
98,262
$
79,000
$
197,433
$
139,641
Stock-based compensation expense
(13,681
)
(9,715
)
(26,277
)
(16,811
)
Employer payroll tax on employee stock
transactions
(254
)
(126
)
(574
)
(279
)
Amortization of acquired intangible
assets
(1,954
)
(2,143
)
(3,861
)
(2,326
)
Acquisition-related compensation
(164
)
(535
)
(413
)
(535
)
Non-GAAP sales and marketing expense
$
82,209
$
66,481
$
166,308
$
119,690
General and administrative expense
reconciliation:
GAAP general and administrative
expense
$
48,433
$
40,447
$
100,186
$
75,337
Stock-based compensation expense
(20,705
)
(15,392
)
(44,695
)
(27,615
)
Employer payroll tax on employee stock
transactions
127
(159
)
(425
)
(449
)
Amortization of acquired intangible
assets
(1
)
(19
)
(2
)
(37
)
Acquisition-related compensation
(14
)
(336
)
(382
)
(336
)
Non-GAAP general and administrative
expense
$
27,840
$
24,541
$
54,682
$
46,900
Restructuring expense
reconciliation:
GAAP restructuring expense
$
4,255
$
—
$
4,255
$
—
Severance and employee benefits
(5,315
)
—
(5,315
)
—
Stock-based compensation expense
1,060
—
1,060
—
Non-GAAP restructuring expense
$
—
$
—
$
—
$
—
Operating loss reconciliation:
GAAP operating loss
$
(100,357
)
$
(108,192
)
$
(215,734
)
$
(198,488
)
Stock-based compensation expense
52,846
41,001
108,395
72,631
Employer payroll tax on employee stock
transactions
352
417
1,476
899
Amortization of acquired intangible
assets
7,093
7,301
13,973
8,042
Acquisition-related compensation
604
1,376
1,669
1,376
Inventory write-offs due to
restructuring
720
—
720
—
Severance and employee benefits
5,315
—
5,315
—
Non-GAAP operating loss*
$
(33,427
)
$
(58,096
)
$
(84,186
)
$
(115,539
)
Operating margin
reconciliation:
GAAP operating margin
(67
)%
(106
)%
(76
)%
(110
)%
Stock-based compensation expense
36
%
40
%
38
%
40
%
Employer payroll tax on employee stock
transactions
—
%
—
%
1
%
—
%
Amortization of acquired intangible
assets
5
%
7
%
5
%
4
%
Acquisition-related compensation
—
%
1
%
—
%
1
%
Inventory write-offs due to
restructuring
—
%
—
%
—
%
—
%
Severance and employee benefits
4
%
—
%
2
%
—
%
Non-GAAP operating margin*
(22
)%
(57
)%
(30
)%
(64
)%
Net loss reconciliation:
GAAP net loss
$
(89,538
)
$
(96,306
)
$
(196,407
)
$
(186,140
)
Stock-based compensation expense
52,846
41,001
108,395
72,631
Employer payroll tax on employee stock
transactions
352
417
1,476
899
Amortization of acquired intangible
assets
7,093
7,301
13,973
8,042
Acquisition-related compensation
604
1,376
1,669
1,376
Inventory write-offs due to
restructuring
720
—
720
—
Severance and employee benefits
5,315
—
5,315
—
Gain on strategic investments
(2,000
)
—
(2,000
)
—
Income tax provision (benefit)
—
(9,667
)
—
(9,667
)
Non-GAAP net loss
$
(24,608
)
$
(55,878
)
$
(66,859
)
$
(112,859
)
Basic and diluted EPS
reconciliation:
GAAP net loss per share, basic and
diluted
$
(0.31
)
$
(0.35
)
$
(0.68
)
$
(0.68
)
Stock-based compensation expense
0.18
0.15
0.37
0.27
Employer payroll tax on employee stock
transactions
—
—
0.01
—
Amortization of acquired intangible
assets
0.03
0.03
0.05
0.03
Acquisition-related compensation
—
—
0.01
0.01
Inventory write-offs due to
restructuring
—
—
—
—
Severance and employee benefits
0.02
—
0.02
—
Gain on strategic investments
(0.01
)
—
(0.01
)
—
Income tax provision (benefit)
—
(0.03
)
—
(0.04
)
Non-GAAP net loss per share, basic and
diluted*
$
(0.08
)
$
(0.20
)
$
(0.23
)
$
(0.41
)
*Certain figures may not sum due to
rounding.
SENTINELONE, INC.
SELECTED CASH FLOW
INFORMATION
(in thousands)
(unaudited)
Reconciliation of cash used in operating activities to
free cash flow
Three Months Ended July
31,
Six Months Ended July
31,
2023
2022
2023
2022
GAAP net cash used in operating
activities
$
(11,903
)
$
(62,126
)
$
(39,962
)
$
(111,477
)
Less: Purchases of property and
equipment
(32
)
(1,293
)
(494
)
(4,101
)
Less: Capitalized internal-use
software
(3,253
)
(3,454
)
(6,165
)
(6,028
)
Free cash flow
$
(15,188
)
$
(66,873
)
$
(46,621
)
$
(121,606
)
Net cash provided by (used in) investing
activities
$
(16,402
)
$
(384,579
)
$
14,708
$
(1,243,104
)
Net cash provided by financing
activities
$
10,499
$
11,974
$
20,261
$
16,878
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230831789770/en/
Investor Relations: Doug Clark investors@sentinelone.com
Press: Karen Master karen.master@sentinelone.com +1 (440)
862-0676
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