Zuora

ZUORA 2024
Annual Report


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
(Mark One)
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended January 31, 2024
OR
□
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: 001-38451
Zuora, Inc.
(Exact name of registrant as specified in its charter)
Delaware
20-5530976
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification Number)
101 Redwood Shores Parkway,
Redwood City, California
(Address of principal executive offices)
94065
(Zip Code)
(888) 976-9056
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Class A common stock, par value $0.0001 per
share
ZUO
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒No □
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes □No ☒
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 ☒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 ☒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 an emerging growth company. See the 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
□
Smaller reporting company
□
Emerging growth company
□
If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm
that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements. □
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based
compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). □
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes □No ☒
The aggregate market value of the voting and non-voting stock held by non-affiliates of the Registrant, based on the closing price, as reported
by the New York Stock Exchange, of the Registrant’s Class A common stock, as of July 31, 2023, the last business day of the Registrant’s most
recently completed second fiscal quarter, was approximately $1.3 billion. Solely for purposes of this disclosure, shares of the Registrant’s Class A
common stock and Class B common stock held by executive officers and directors of the Registrant as of such date have been excluded because
such persons may be deemed to be affiliates. This determination of executive officers and directors as affiliates is not necessarily a conclusive
determination for any other purposes.
As of February 29, 2024, the number of shares of the Registrant’s Class A common stock outstanding was 137.8 million and the number of
shares of the Registrant’s Class B common stock outstanding was 8.2 million.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant’s definitive Proxy Statement relating to the 2024 Annual Meeting of Stockholders are incorporated herein by
reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such Proxy Statement will be filed with the Securities and
Exchange Commission within 120 days of the registrant’s fiscal year ended January 31, 2024. Except with respect to information specifically
incorporated by reference in this Form 10-K, the Proxy Statement is not deemed to be filed as part of this Form 10-K.

Page
PART I
Item 1.
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3
Item 1A.
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
Item 1B.
Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
49
Item 1C.
Cybersecurity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
49
Item 2.
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50
Item 3.
Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50
Item 4.
Mine Safety Disclosures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
51
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
52
Item 6.
[Reserved] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
53
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of
Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
54
Item 7A.
Quantitative and Qualitative Disclosures about Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . .
70
Item 8.
Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
72
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108
Item 9A.
Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108
Item 9B.
Other Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections . . . . . . . . . . . . . . . . . .
108
PART III
Item 10.
Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Item 11.
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Item 13.
Certain Relationships and Related Transactions, and Director Independence. . . . . . . . . . . 109
Item 14.
Principal Accounting Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
PART IV
Item 15.
Exhibits, Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
Item 16.
Form 10-K Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112
SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Unless the context otherwise requires, references in this Annual Report on Form 10-K (Form 10-K) to
‘‘Zuora,’’ ‘‘Company,’’ ‘‘our,’’ ‘‘us,’’ and ‘‘we’’ refer to Zuora, Inc. and, where appropriate, its consolidated
subsidiaries. Our fiscal year end is January 31. References to ‘‘fiscal’’ followed by the year refer to the
fiscal year ended January 31 for the referenced year.
This Form 10-K contains forward-looking statements within the meaning of the federal securities
laws. All statements contained in this Form 10-K, other than statements of historical fact, including
statements regarding our future operating results and financial position, our business strategy and plans,
market growth, and our objectives for future operations, are forward-looking statements. Words such as
‘‘believes,’’ ‘‘may,’’ ‘‘will,’’ ‘‘determine,’’ ‘‘estimates,’’ ‘‘potential,’’ ‘‘possible,’’ ‘‘continues,’’ ‘‘anticipates,’’
‘‘intends,’’ ‘‘expects,’’ ‘‘could,’’ ‘‘would,’’ ‘‘projects,’’ ‘‘plans,’’ ‘‘targets,’’ ‘‘may affect,’’ ‘‘seek,’’ and variations
of such words and similar expressions are intended to identify forward-looking statements.
Forward-looking statements contained in this Form 10-K include, but are not limited to, statements
about our expectations regarding:
•
trends in revenue, cost of revenue, and gross margin;
•
economic uncertainty and associated trends in macroeconomic conditions, as well as
geopolitical conditions, including the effects of economic downturns, inflation, rising interest
rates, bank failures, debt ceiling negotiations, potential government shutdowns, and wars;
•
currency exchange rate fluctuations;
•
trends and expectations in our operating and financial metrics, including customers with annual
contract value (ACV) equal to or greater than $250,000, dollar-based retention rate, annual
recurring revenue, and growth of and within our customer base;
•
future acquisitions, the anticipated benefits of such acquisitions and our ability to integrate the
operations and technology of any acquired company;
•
industry trends, projected growth, or trend analysis, including the shift to recurring revenue
business models;
•
our investments in our platform and the cost of third-party hosting fees;
•
the expansion and functionality of our technology offering, including expected benefits of such
products and technology, and our ability to further penetrate our customer base;
•
trends in operating expenses, including research and development expense, sales and
marketing expense, and general and administrative expense, and expectations regarding these
expenses as a percentage of revenue;
•
our liquidity being sufficient to meet our working capital and capital expenditure needs for at least
the next 12 months;
•
the impact of actions that we are taking to improve operational efficiencies and operating costs,
including the workforce reduction we approved in January 2024;
•
disruptions to the U.S. and international banking systems; and
•
other statements regarding our future operations, financial condition, prospects and business
strategies, including our ability to sublease office space at our corporate headquarters in
California.
Such forward-looking statements are based on our expectations as of the date of this filing and are
subject to a number of risks, uncertainties and assumptions, including but not limited to, risks detailed in
the ‘‘Risk Factors’’ section of this Form 10-K. Readers are urged to carefully review and consider the
various disclosures made in this Form 10-K and in other documents we file from time to time with the
Securities and Exchange Commission (SEC) that disclose risks and uncertainties that may affect our
business. Moreover, we operate in a very competitive and rapidly changing environment. New risks
emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all
1

factors on our business or the extent to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any forward-looking statements we may make. In light
of these risks, uncertainties and assumptions, the future events and circumstances discussed in this
Form 10-K may not occur and actual results could differ materially and adversely from those anticipated
or implied in the forward-looking statements.
You should not rely upon forward-looking statements as predictions of future events. The events and
circumstances reflected in the forward-looking statements may not be achieved or occur. Although we
believe that the expectations reflected in the forward-looking statements are reasonable, we cannot
guarantee future results, performance or achievements. In addition, the forward-looking statements in this
Form 10-K are made as of the date of this filing, and we do not undertake, and expressly disclaim any
duty, to update such statements for any reason after the date of this Form 10-K or to conform statements
to actual results or revised expectations, except as required by law.
2

PART I
Item 1.
Business
Overview
Zuora provides a leading monetization suite for modern businesses, built to help companies launch
and scale new services and operate dynamic, customer-centric business models. Our technology
solutions enable companies across multiple industries and geographies to build, run, and grow a modern,
subscription business, automating the quote-to-revenue process, including offers, billing, collections, and
revenue recognition. With Zuora’s solutions, businesses can change and evolve how they go to market
through a mix of monetization models, efficiently comply with revenue recognition standards, analyze
customer data to optimize their offerings and build recurring relationships with their customers.
Many of today’s enterprise software systems manage their quote-to-revenue process using software
built for one-time transactions. These systems were not designed for the dynamic, ongoing nature of
recurring revenue, consumption-based, or hybrid pricing models, and can be extremely difficult to
configure. In traditional product-based businesses, quote-to-revenue is a linear process — a customer
orders a product, is billed for that product, payment is collected, and the revenue is recognized. These
legacy product-based systems were not specifically designed to handle the complexities of managing
ongoing customer relationships and recurring revenue models commonly found in subscription
businesses, including billing proration, revenue recognition and reporting, and calculating the lifetime
value of the customer. Using legacy or homegrown software to build a recurring revenue business often
results in inefficient processes with prolonged and complex manual downstream work, hard-coded
customizations, and a proliferation of stock-keeping units (SKUs).
However, enterprise business models are inherently dynamic, with multiple interactions, flexible
pricing, global complexities, and continuously evolving relationships and events. The capabilities to
launch, price, and bill for products, facilitate and record cash receipts, process and recognize revenue,
and analyze data to drive key decisions are mission critical and particularly complex for companies that
operate at a global scale. As a result, as companies launch, grow, and scale their businesses, they often
conclude that legacy systems are inadequate. This is where Zuora comes in.
Our vision is ‘‘The World Subscribed’’ — the idea that one day every company will be a part of the
Subscription Economy. Our focus has been on providing the technology our customers need to thrive as
customer-centric, recurring revenue businesses.
Our solutions include Zuora Billing, Zuora Revenue, Zuora Payments, Zephr, Zuora Platform, and
other software that support and expand upon these core offerings (together, ‘‘our solutions’’). Our
software helps companies analyze data — including information such as which customers are delivering
the most recurring revenue, or which segments are showing the highest churn — enabling customers to
make informed decisions about their monetization strategy and quickly implement changes such as
launching new services, updating pricing (usage, time, or outcome based), delivering new offerings, or
making other changes to their customers’ experience. We also have a large ecosystem of global partners
that can assist our customers with additional monetization strategies and services throughout the
subscription journey.
Companies in a variety of industries — technology, manufacturing, media and entertainment,
telecommunications, and many others — are using our solutions to scale and adapt to a world that is
increasingly choosing subscription-based offerings. Our customers include 19% of the Fortune 100
companies as of January 31, 2024.
Products
Our cloud-based solutions enable companies to monetize business models by automating their
quote-to-revenue operations. We can deploy and configure our portfolio of products to meet a wide
variety of use cases for companies with recurring revenue, consumption-based, or hybrid business
models.
3

Our product offerings include:
•
Zuora Billing. Zuora Billing allows our customers to deploy a variety of pricing and packaging
strategies to monetize their recurring revenue streams, efficiently and accurately bill customers,
calculate prorations when subscriptions change, and automate billing and payment operations.
The offering also helps our customers set payment terms, manage hierarchical billing
relationships, consolidate invoicing across multiple subscriptions, and calculate taxes. Zuora
Billing also includes our Zuora CPQ module, which enables customers to configure, price, and
quote a wide variety of subscription options, including complex arrangements such as multi-year
subscriptions, and price ramps. The Zuora CPQ module also uses a rules engine and guided
selling workflows to help customers scale their sales teams.
•
Zuora Revenue. Zuora Revenue is a revenue recognition and automation solution that
accounting teams use to manage their complex revenue streams. Zuora Revenue helps our
customers automate revenue and deferred revenue management in accordance with their
accounting policies, business rules, and pricing models, and also includes support for complex
scenarios around standalone selling price (SSP) analysis for determining the fair value of the
individual goods and services sold, cost management accounting, and amortization of costs
incurred as part of obtaining or fulfilling a contract with a customer.
•
Zuora Payments. Zuora Payments is designed to provide payment orchestration services for
companies looking to operate globally, helping them increase conversions while reducing costs.
It has a broad set of payment capabilities enabling customers to utilize a global network of
payment gateways and methods, easily accept payments via hosted payment forms, securely
store the payment methods with a PCI-compliant vault, dynamically route payments and smart
payment recovery and dunning tools to reduce involuntary churn. It optionally provides Zuora
Fraud Protection, which is designed to protect customers from payment fraud activities like bot
attacks and chargebacks and improve the transaction acceptance.
•
Zephr. Zephr is a digital subscriber experience platform that helps companies, including those in
the digital publishing and media industry, orchestrate dynamic experiences that increase
conversion, reduce churn, and nurture ongoing subscriber relationships.
•
Our Zuora Platform acts as an orchestration engine for all subscription data and processes,
allowing our customers to power their quote-to-revenue process and deeply understand their
customers to tailor their experience with curated offers. Zuora Platform provides the following
capabilities:
○
Integrated data model enabling customers to manage their subscribers and easily set
up and iterate offerings, subscribers, subscriptions, rate plans, payment methods and
other metrics.
○
Enterprise-grade features for security, compliance, and tenant management as well as
functionality to integrate to any relevant enterprise application such as
configure-price-quote (CPQ), e-commerce, customer portal, and general ledger.
○
Developer tools that enable customers and system integrators to customize and extend
the functionality of the platform, including workflow, custom objects, data queries, and
test environments.
○
Analytics and reporting to provide customers insights from their subscriber data and
related activity across the subscriber lifecycle, including out-of-the-box subscription
metrics such as monthly recurring revenue (MRR), ACV, and customer churn.
Business Benefits of Using Our Solutions
Zuora’s products enable companies to:
•
Monetize for Their Business Models. Zuora helps companies transform their existing
product-centric business models into customer-centric services to take advantage of the
predictability and resilience of a recurring revenue business.
4

•
Reduce Time to Market. Zuora reduces the time required to go to market with new offerings
and iterate on the pricing and packaging of existing offerings, enabling businesses to quickly
react to changing market and customer needs, launch new services, and enter new markets.
Changes can be made at scale and without having to re-code or re-engineer back office
systems.
•
Increase Operational Efficiencies. Customers regularly make changes to their subscriptions.
Zuora automates these processes and reduces the impact of changes across the
quote-to-revenue process, including proration for invoices, changes to revenue recognition,
taxation, provisioning, and reporting. Automating these functions saves businesses valuable time
and resources by eliminating manual processes and customizations while increasing operational
efficiencies.
•
Free Up IT and Engineering Resources. Our cloud-based solutions reduce both system
complexity and costs. With Zuora, engineering and IT departments no longer need to build
in-house custom systems or customizations for their Enterprise Resource Planning (ERP)
systems to keep pace with market changes, ongoing customer demands, and new
quote-to-revenue processes.
•
Establish a Single System of Record. Our solutions capture financial and operational data and
enable businesses to have a single system of record rather than having to reconcile data from
multiple systems. Key business metrics can be accessed at any point in time to make critical
business decisions.
•
Make Customer Data-Driven Decisions. Because our solutions serve as a single source of
data and information for subscribers, companies can use Zuora to gain insight into subscriber
data and behavior. This helps them understand their subscribers better, identify up-sell
opportunities, and increase customer retention.
•
Access Growing Ecosystem of Quote-to-Revenue Partners. Our solutions have over 50
pre-built connectors to various quote-to-revenue software partners, including payment gateways,
tax vendors, general ledgers, ERP, and Customer Relationship Management (CRM) systems.
Rather than building integrations for each of these, our customers can take advantage of
pre-built connectors to extend the capabilities of Zuora for specific industries.
•
Support Rapid International Expansion. With over 45 pre-built payment gateways, over 150
supported currencies, and 17 supported payment methods, our solutions enable companies to
quickly expand internationally and acquire and support customers in new countries.
•
Manage Complex Revenue Streams. In light of the accounting complexities associated with
recurring revenue models, our revenue recognition software automates revenue recognition
processes in compliance with certain accounting standards and reduces our customers’ reliance
on error-prone manual processing and spreadsheets.
Competitive Strengths
We believe the following competitive advantages enable us to maintain and extend our leadership as
the system of record for companies in the Subscription Economy:
•
Comprehensive solutions built specifically to handle the complexities of recurring revenue
business models;
•
Flexible technology with a broad range of customers and use cases;
•
Pre-built connectors, application programming interfaces (APIs), and SDKs, that can easily
integrate with a variety of applications, such as a General Ledger, Data Warehouses, taxation
systems, payment gateways, and more;
•
Mission-critical system that is difficult to replace;
•
Accelerated pace of innovation with over a decade of development experience;
•
Deep domain expertise across a broad range of recurring revenue business models;
5

•
Proven track record with 461 customers with ACV equal to or greater than $250,000 as of
January 31, 2024;
•
Strong network of systems integrator partners; and
•
Growing ecosystem with dozens of pre-built integrations to payment gateways, tax solutions,
and enterprise applications.
Growth Strategy
Key elements of our growth strategy include:
•
New Customer Acquisition. We intend to continue to acquire new enterprise customers in
current and future vertical and geographic markets. The enterprise customers we target include
both large enterprises and fast-growing enterprises and disruptors that we believe will become
large enterprises. Given our recent experience with slower IT spending among our target
customers, we have implemented a ‘‘lighter, faster’’ sales strategy, which means we are focused
on acquiring new customers through smaller deals that are less likely to result in protracted sales
cycles.
•
Expand Relationships with Existing Customers. We intend to expand existing customers’ use
of our platform and drive sustainable growth in multiple ways, such as increasing transaction
volume, up-sells and cross-sells of additional products. Our lighter, faster sales strategy
positions us well to expand our relationships with customers over time.
•
Enter New Vertical Markets. We currently have a strong position in key vertical markets,
including technology, media and entertainment, and manufacturing. We intend to continue to
expand to additional vertical markets over time.
•
Expand our Global Footprint. As the market for our products continues to evolve around the
world, we may further expand into new countries where we see future opportunities.
•
Leverage Global Systems Integrators to Accelerate our Growth. We plan to continue to work
with systems integrators to leverage their role in advocating for and implementing our current
and prospective customers’ transformations to recurring revenue business models.
•
Launch New Products and Extend our Technology Lead. As we grow and evolve with our
customers, we plan to continue developing and offering additional software to enhance our
current offerings.
•
Optimize Pricing and Packaging. We intend to optimize and enhance pricing and packaging to
further align the value our customers realize from our software with the revenue we receive.
Our Customers
Organizations of all sizes, across a wide variety of industries and in many locations around the world,
use our solutions. As of January 31, 2024, we had 461 customers with ACV equal to or greater than
$250,000, representing over 80% of our total ACV. As of January 31, 2023 and 2022, we had 431 and
369 customers, respectively, with ACV equal to or greater than $250,000. We define the number of
customers at the end of any particular period as the number of parties or organizations that have entered
into a distinct subscription contract with us and for which the term has not ended. Each such party with
whom we have entered into a distinct subscription contract is considered a unique customer, and in some
cases, there may be more than one customer within a single organization. For more information on ACV,
see ‘‘Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key
Operational and Financial Metrics.’’
Sales and Marketing
We market and sell to organizations of different sizes across a broad range of industries. We work
with companies that are launching, transforming, and scaling new recurring revenue business models,
with a focus on enterprise-scale businesses, or fast-growing companies with the potential to achieve
enterprise scale.
6

Our sales model is supported by a field sales organization. Because of the transformative nature of
our solutions, especially in larger organizations, the selling process is often complex and can involve
agreement across multiple departments inside an organization, including the chief executive officer. Over
the years, we have developed methodologies and best practices to assist our sales teams in navigating
these challenges and have built these learnings into our sales enablement and training to assist with
onboarding and productivity of new sales account executives. We believe our sales methodologies and
processes offer us significant advantages, particularly in long enterprise sales cycles. Our sales teams
are organized by geographic territories, new and install base, and industry verticals. We plan to continue
to invest in our direct sales force to grow our enterprise customer base, both domestically and
internationally.
We conduct a wide range of account-based marketing activities such as hosting virtual webinars and
online events; marketing with our systems integrators, consultants, and ecosystem partners; sharing
insights from the Subscription Economy Index, our study of the collective health of subscription
businesses and their impact on the overall economy; and sharing educational content, data-based
benchmarks, and best practices for the Subscription Economy in a variety of formats such as digital, print,
and video on Zuora.com and Subscribed.com.
As newer markets emerge domestically and internationally, we plan to continue investing in our sales
and marketing efforts to grow our customer base.
Competition
The market for monetization products and services is highly competitive, rapidly evolving,
fragmented, and subject to changing technology, shifting customer needs, and frequent introductions of
new products and services.
Our main competitors fall into the following categories:
•
providers of traditional ERP software, such as Oracle Corporation and SAP SE;
•
providers of CRM applications such as Salesforce;
•
traditional quote-to-revenue solutions that address individual elements of the subscription
revenue process, such as traditional CPQ management, billing, collections, revenue recognition,
or e-commerce software;
•
niche billing systems for telecommunications, such as Amdocs Limited;
•
payment platforms that offer built-in recurring billing functionality;
•
startup usage billing specialists;
•
point solution providers; and
•
in-house custom built systems.
We believe the principal competitive factors in our market include:
•
subscription and consumption-based product features and functionality;
•
ability to support the specific needs of companies with recurring revenue, consumption or hybrid
business models, or combinations of these various complex business models;
•
ease of use;
•
vision for the market and product innovation;
•
expertise, best practices, and frameworks for launching, transforming, and scaling new business
models;
•
enterprise-grade performance and features such as system scalability, security, performance,
and resiliency;
•
customer experience, including support and professional services;
•
strength of sales and marketing efforts;
7

•
relationships with systems integrators, management consulting firms, and resellers;
•
ability to integrate with legacy and other enterprise infrastructures and third-party applications;
•
brand awareness and reputation; and
•
total cost of the solutions.
We believe we compete favorably against our competitors with respect to these factors. Our ability to
compete will largely depend on our ongoing performance and the quality of our platform.
Human Capital
People and Culture
Zuora aims to recruit, develop and engage a diverse workforce that continues to advance the
Subscription Economy. Our culture is rooted in the premise that our employees, whom we call ‘‘ZEOs’’,
are empowered to embrace a mindset of ownership in order to think differently and creatively as they
innovate and collaborate working together as one team building toward our vision. Our culture is key to
our success and we strive to create an inclusive, high-performing environment where ZEOs feel valued
and supported to achieve both their and the company’s objectives. As of January 31, 2024, we had 1,618
employees, including 910, or 56%, located outside the United States, primarily in Asia, Europe, and
Australia. The number of employees we had at January 31, 2024 does not reflect headcount reductions in
connection with the workforce reduction we announced in January 2024.
Employee Well-Being and Engagement
The overall well-being of our employees is important to us and is an integral part of our company
culture. Our global well-being programs include a practice of remote working arrangements, flexible paid
time off, life planning benefits, wellness platforms and employee assistance. In addition, we ensure
ongoing check-ins with employees by managers to provide additional channels of support and career
development. We also regularly seek input from employees, including through broad employee
satisfaction surveys on specific issues intended to assess our degree of success in promoting an
environment where employees are engaged, satisfied, productive and possess a strong understanding of
our business goals.
Diversity and Inclusion
As a global company, we embrace the diversity of our employees, partners, customers, other
stakeholders and the communities we collectively serve. We believe our diversity and inclusion efforts are
a focus of our stakeholders and their engagement with us, especially those outside of the United States,
and lead to a positive economic impact. We are committed to developing a diverse and thriving workforce
and inclusive ZEO culture. We seek and embrace people who bring diverse backgrounds, perspectives,
and experiences and believe this is critical to our success. We continue to build diversity and inclusion
into our culture with a focus on creating environments and practices that mitigate bias and allow our
employees to be their authentic selves while performing their best work at Zuora.
Our Zuora employee resource groups (ZRGs), which are ZEO-led groups open to all ZEOs that aim
to elevate the experiences and interest of underrepresented groups in our workforce, play a key role in
this effort. As of January 31, 2024 we had nine ZRGs covering a wide variety of interests.
As part of our inclusion efforts, we also foster multiple ongoing educational opportunities and events
for employees to have open and ongoing conversations across teams and with senior leaders on a variety
of topics. These are opportunities for continuous learning as well as for Zuora to receive feedback on how
we can improve our workplace and culture, while also encouraging a meaningful connection and sense of
belonging across our globally-distributed workforce.
As of January 31, 2024, our executive management team was comprised of 30% women and 40%
self-identified as coming from certain other underrepresented groups. In addition, our Board of Directors
is made up of highly skilled individuals from the technology and business sectors. As of January 31, 2024,
women represent 33% of our Board of Directors and 33% of our Board of Directors identify as members
of certain other underrepresented groups.
8

Learning and Development
We believe that investing in the growth and development of our ZEOs will directly enhance our
overall company performance. As owners of their careers, ZEOs are encouraged to invest regularly in
their own professional development. In support of this, we offer mentorship programs, leadership
programs, and other Z-Grow employee training programs, which are designed to help ZEOs develop and
manage their careers, drive accountability, and promote a culture of continuous feedback. Additionally,
through our Career Cash program, we reimburse ZEOs for costs related to pursuing learning and
professional development opportunities.
Competitive Pay and Benefits
We strive to provide pay, comprehensive benefits and services that help meet the varying needs of
our ZEOs. Our total rewards package includes market-competitive pay, including equity compensation,
paid time off, and other comprehensive and competitive global benefits. For example, in the United
States, we provide 26 weeks of paid parental leave for new parents who have been employed with us for
at least six months. To foster a stronger sense of ownership and to align ZEO interests with our
stockholders’ interests, we offer equity compensation under our broad-based stock incentive programs.
We also offer the opportunity for eligible ZEOs in the United States and many international locations to
participate in our employee stock purchase plan (ESPP).
Social Impact
We encourage our ZEOs to give back to the causes that matter to them. Zuora is a member of the
Pledge 1% movement and we are committed to leveraging our employees’ time and talent to make the
communities where we live and work stronger. To facilitate our Pledge 1% initiative, we have empowered
our employees with the tools and resources they need to create local Z-Philanthropy chapters at our
offices worldwide. Through our Z-Philanthropy chapters, ZEOs in our offices across the globe step up to
lead giving and volunteering efforts throughout the year and create lasting partnerships with local
nonprofits through these employee-led groups. In addition to the sustained efforts of our local
Z-Philanthropy chapters, we host an annual Global Month of Service where ZEOs worldwide participate in
volunteer and fundraising events. In fiscal 2024, our ZEOs volunteered over 3,500 hours of their time to
mission-aligned nonprofits.
Additionally, Zuora made a $0.5 million cash donation in fiscal 2024 to the Zuora Impact Fund, a
donor-advised fund managed by the Tides Foundation. The Tides Foundation uses the share proceeds to
make charitable donations to a wide variety of nonprofits helping communities around the world. We also
have an annual employee matching gifts program under which the Zuora Impact Fund matches up to
$1,000 per ZEO for their charitable donations, volunteer time, or a combination of the two.
Intellectual Property
We primarily rely on a combination of patents, copyrights, trademarks, trade secrets, confidentiality
procedures, contractual commitments, and other legal rights to protect our intellectual property. As of
January 31, 2024, we had 55 issued patents that expire between 2032 and 2041 as well as 32 patent
applications pending in the U.S and foreign jurisdictions. We also pursue the registration of our domain
names, trademarks, and service marks in the United States and in certain foreign jurisdictions. Our
trademarks include Zuora, Subscription Economy, Subscribed, Powering the Subscription Economy and
Zephr. Additionally, we enter into confidentiality and invention assignment agreements with our
employees and consultants and enter into confidentiality agreements with other parties in connection with
the disclosure of our confidential information.
Intellectual property laws, procedures, and restrictions provide only limited protection and any of our
intellectual property rights may be challenged, invalidated, circumvented, infringed, or misappropriated.
Further, the laws of certain countries do not protect proprietary rights to the same extent as the laws of
the United States and, therefore, in certain jurisdictions, we may be unable to protect our proprietary
technology.
9

Compliance with Government Regulations
We are subject to various U.S. federal, state, local and foreign laws and regulations, including those
relating to data privacy, security and protection, intellectual property, employment and labor, workplace
safety, consumer protection, anti-bribery, import and export controls, immigration, federal securities and
tax. In addition, our clients in heavily regulated industries and the public sector may be subject to various
laws and regulations relating to the formation, administration requirements and performance of contracts
which affect how we and our partners do business with such customers. Additional laws and regulations
relating to these areas likely will be passed in the future, and these or existing laws and regulations may
be interpreted or enforced in new or expanded manners, each of which could result in significant
limitations on ways we operate our business.
New and evolving laws and regulations, and changes in their enforcement and interpretation, may
require changes to our platform, products, services, or business practices, and may significantly increase
our compliance costs and otherwise adversely affect our business and results of operations. As our
business expands to include additional products and services, and our operations expand internationally,
our compliance requirements and costs may increase, and we may be subject to increased regulatory
scrutiny. We believe we are currently in material compliance with laws and regulations to which we are
subject and do not expect continued compliance to have a material impact on our capital expenditures,
earnings, or competitive position. We continue to monitor existing and pending laws and regulations and
while the impact of regulatory changes cannot be predicted with certainty, we do not expect compliance
requirements to have a material adverse effect.
Corporate Information
We were incorporated in the State of Delaware in September 2006. Our principal executive offices
are located at 101 Redwood Shores Parkway, Redwood City, California 94065 and our telephone number
is (888) 976-9056. Our website address is www.zuora.com, and our investor relations website is
https://investor.zuora.com. The information on, or that can be accessed through, our website is not part of
this Annual Report on Form 10-K.
Zuora, the Zuora logo, Zephr, Zuora Platform, Zuora Billing, Zuora Revenue, Zuora CPQ, Zuora
Payments, Zuora Marketplace, Powering the Subscription Economy, Subscribed, Subscription Economy,
and other registered or common law trade names, trademarks, or service marks of Zuora appearing in
this Form 10-K are the property of Zuora. This Form 10-K contains additional trade names, trademarks,
and service marks of other companies that are the property of their respective owners. We do not intend
our use or display of other companies’ trade names, trademarks, or service marks to imply a relationship
with, or endorsement or sponsorship of us by these other companies. Solely for convenience, our
trademarks and tradenames referred to in this Form 10-K appear without the ® and ™symbols, but those
references are not intended to indicate, in any way, that we will not assert, to the fullest extent under
applicable law, our rights, or the right of the applicable licensor, to these trademarks and tradenames.
Available Information
Our reports filed with or furnished to the SEC pursuant to Sections 13(a) and 15(d) of the Securities
Exchange Act of 1934, as amended (Exchange Act) are available, free of charge, on our Investor
Relations website at https://investor.zuora.com as soon as reasonably practicable after we electronically
file such material with, or furnish it to, the SEC. The SEC maintains a website at http://www.sec.gov that
contains reports, and other information regarding us and other companies that file materials with the SEC
electronically. We use our Investor Relations website as a means of disclosing material information.
Accordingly, investors should monitor our Investor Relations website, in addition to following our press
releases, SEC filings and public conference calls and webcasts.
Information contained on or accessible through any website reference herein is not part of, or
incorporated by reference in, this Annual Report on Form 10-K, and the inclusion of such website
addresses in this Annual Report on Form 10-K is as inactive textual references only.
10

Item 1A.
Risk Factors
A description of the risks and uncertainties associated with our business is set forth below. You
should carefully consider the risks and uncertainties described below, as well as the other information in
this Form 10-K, including our accompanying consolidated financial statements and the related notes and
‘‘Management’s Discussion and Analysis of Financial Condition and Results of Operations.’’ The
occurrence of any of the events or developments described below, or of additional risks and uncertainties
not presently known to us or that we currently deem immaterial, could materially and adversely affect our
business, results of operations, financial condition and growth prospects. In such an event, the market
price of our Class A common stock could decline and you could lose all or part of your investment.
Risk Factors Summary
The following is a summary of key risk factors when considering an investment. You should read the
summary risks together with the more detailed discussion of risks set forth following this summary, as well
as elsewhere in this Annual Report on Form 10-K.
Risks Related to Our Business and Industry
•
If we are unable to attract new customers and retain and expand sales to existing customers, our
revenue growth could be slower than we expect and our business may be adversely affected.
•
If we fail to manage our revenue and profitability plans effectively, our business, operating
results, and financial condition could be adversely affected.
•
If the market for monetization platform software and related solutions, and consumer adoption of
products and services that are provided through such solutions, develops slower than we expect,
our growth may slow or stall, and our operating results could be adversely affected.
•
If we are unable to successfully execute our strategic initiatives, such as increasing our sales to
large enterprises and fast-growing enterprises and disruptors as well as expanding and
strengthening our sales channels and relationships with system integrators, our business,
operating results and financial condition could be adversely affected.
•
If we are unable to recruit or retain senior management or other key personnel and maintain our
corporate culture, we may not be able to execute on our business strategy.
•
If we are unable to effectively compete in the market for our solutions or such markets develop
slower than we expect, our business, operating results, and financial condition would be
adversely affected.
•
Current and future economic uncertainty and other unfavorable conditions in our industry or the
global economy have limited and may continue to limit our growth and adversely affect our
operating results.
•
We have a history of net losses and may not achieve or sustain profitability.
•
Our revenue growth and ability to achieve and sustain profitability will depend, in part, on our
ability to increase productivity of our sales force.
•
Our success depends in large part on a limited number of products, and if these current or future
products fail to gain market acceptance or our product development efforts are unsuccessful, our
business, operating results, and financial condition could be adversely affected.
•
Currency exchange rate fluctuations may adversely affect our operating results.
•
We face risks related to our debt obligations.
•
Our operating results, which are influenced by a variety of factors, have fluctuated in the past
and may continue to fluctuate, making our future results difficult to predict accurately.
•
If we are not able to successfully and timely develop, enhance and deploy our products and
multi-product strategy, our business, operating results, financial condition and growth prospects
could be adversely affected.
11

•
We may be unable to integrate businesses we have or will acquire or to achieve expected
benefits of such acquisitions.
•
Our international operations expose us to risks that could have a material adverse effect on our
business, operating results, and financial condition.
•
If we fail to integrate our solutions with a variety of systems, applications and platforms that are
developed by others, our solutions may become less marketable, less competitive, or obsolete,
and our operating results may be adversely affected.
Risks Related to Information Technology, Intellectual Property, and Data Security and Privacy
•
If our security measures are breached or if unauthorized access to customer, employee or other
confidential data is otherwise obtained, or if our solutions are perceived as not being secure, we
may lose existing customers or fail to attract new customers, our business may be harmed and
we may incur significant liabilities.
•
Privacy and security concerns, laws, and regulations, may adversely affect our business.
•
Inability or failure to protect our intellectual property could adversely affect our business.
•
Any disruptions of service at our cloud providers, including Amazon Web Services (AWS) and
Microsoft’s Azure cloud service, could interrupt or delay our ability to deliver our services to our
customers, which could harm our business and our financial results.
•
Our increased focus on the development and use of various types of artificial intelligence (AI) in
our platform and our business, as well as our potential failure to effectively implement, use, and
market AI could adversely affect our business.
Risks Related to Legal, Regulatory, Accounting, and Tax Matters
•
Adverse litigation judgments or settlements could expose us to significant monetary damages or
limit our ability to operate our business.
•
If we are not able to satisfy government and industry-specific requirements, such as data
protection, security, privacy, and export laws, our growth could be harmed.
Risks Related to Ownership of Our Class A Common Stock
•
The stock price of our Class A common stock has been, and may continue to be, volatile, and
you could lose all or part of your investment.
•
The dual class structure of our common stock has the effect of concentrating voting control with
holders of our Class B common stock, including our Chief Executive Officer (CEO), which limits
or precludes your ability to influence corporate matters, including the election of directors and the
approval of any change of control transaction.
•
Investor expectations and our disclosed performance and aspirations for environmental, social,
and governance (ESG) factors may expose us to new risks and additional costs.
12

Risks Related to Our Business and Industry
If we are unable to attract new customers and retain and expand sales to existing customers,
our revenue growth could be slower than we expect, and our business may be adversely affected.
Our ability to achieve significant growth in revenue in the future will depend, in large part, upon our
ability to attract new customers, both domestically and internationally. This may be particularly challenging
where an organization has already invested substantial personnel and financial resources to integrate
billings and other business and financial management tools, including custom-built solutions, into its
business, as such an organization may be reluctant or unwilling to invest in new products and services.
As a result, selling our solutions often requires sophisticated, costly, and lengthy sales efforts that are
targeted at functional experts and senior management, and the success of these efforts can be difficult to
predict. During the fiscal year ended January 31, 2024, sales and marketing expenses represented
approximately 39% of our total revenue. If we fail to attract new customers and maintain and expand new
customer relationships, our revenue may grow more slowly than we expect. Additionally, we may
successfully attract new customers but underestimate the length of time for such new relationships to
become profitable. If we experience any of these issues attracting, maintaining, expanding, or profiting
from new customers, our business and operating results may be adversely affected.
Our future revenue growth also depends upon our ability to retain and expand sales and renewals of
subscriptions to our solutions with existing customers. If our existing customers do not expand their use of
our solutions over time, do not renew their subscriptions or if we receive requests from an increased
number of customers for changes to payment or other terms as a result of the impact of macroeconomic
conditions, including global economic uncertainty geopolitical tensions, inflation and increasing interest
rates, on their businesses, our revenue may grow more slowly than expected, may not grow at all, or may
decline. Our success is also dependent, in part, on our ability to effectively differentiate and cross-sell our
products. If we experience issues with successfully implementing or cross-selling our products, revenue
may grow more slowly or may not grow at all.
Our customers generally enter into subscription agreements with terms of one to five years and have
no obligation to renew their subscriptions after the expiration of their initial subscription period. Moreover,
our customers that do renew their subscriptions may renew for lower subscription or usage amounts or for
shorter subscription periods. In addition, in the first year of a subscription, customers often purchase an
increased level of professional services (such as deployment services) than they do in renewal years.
Costs associated with maintaining a professional services department are relatively fixed in the short term
while professional services revenue is dependent on the amount of billable work actually performed for
customers in a period, the combination of which may result in variability in, and have an adverse impact
on, our gross profit. Customer renewals may decline or fluctuate as a result of a number of factors,
including the breadth of deployment, reductions in our customers’ spending levels, the volume of usage
purchased upfront relative to actual usage during the subscription term, changes in customers’ business
models, our customers’ performance, and use cases, our customers’ satisfaction or dissatisfaction with
our solutions, our pricing or pricing structure, the pricing or capabilities of products or services offered by
our competitors, or the effects of general macroeconomic conditions. If our customers do not renew their
agreements with us, or renew on terms less favorable to us, our revenue may decline.
Our sales and marketing efforts are impacted by macroeconomic conditions and other events beyond
our control. In light of current macroeconomic conditions and uncertainty, certain customers and
prospective customers have reduced or delayed technology or other discretionary spending or otherwise
are cautious about purchasing decisions and, as a result, we are experiencing longer sales cycles in
some cases. If the impacts to customers and prospective customers of current macroeconomic conditions
and uncertainty persist or worsen, our business, operating results, financial condition and prospects could
be materially and adversely affected.
While we currently expect to expand our sales efforts both in the U.S. and abroad in the long term,
any continuing or future business disruptions may adversely impact these efforts and our business. We
may be unable to hire and successfully train qualified sales personnel, and sales personnel may not
become fully productive on the timelines that we have projected or at all. Further, although we dedicate
significant resources to sales and marketing programs, these sales and marketing programs may take
longer than we anticipate to have the desired effect, or may not expand sales at all. We cannot assure
13

you that our efforts will result in increased sales or additional revenue. If our efforts to expand sales and
renewals to new and existing customers are not successful, our business and operating results could be
adversely affected.
If we fail to manage our revenue and profitability plans effectively, our business, operating
results, and financial condition could be adversely affected.
We may continue to experience organizational changes which may make our operations more
complex and may continue to place significant demands on our management and our operational and
financial resources. If we are unable to manage our revenue and profitability plans effectively, which may
continue to be impacted by macroeconomic conditions and other factors outside of our control, our
business, operating results, and financial condition could be adversely affected. To manage changes in
our operations and personnel, we will need to continue to improve and achieve efficiencies with respect to
our operational, financial, and management controls and our reporting systems and procedures, including
improving timely access to operational information to optimize business decisions. For example, in
January 2024, our Board of Directors approved a workforce reduction plan designed to better align the
organization with the company’s current business priorities and enable further investment in key areas,
along with strengthening our commitment to profitable growth. Failure to manage revenue and profitability
plans effectively could result in difficulty or delays in deploying customers, declines in quality or customer
satisfaction, increases in costs, difficulties in introducing new products and services or enhancing existing
products and services, loss of customers, or other operational difficulties in executing sales strategies,
any of which could adversely affect our business performance and operating results.
If the market for monetization platform software and related solutions, and consumer
adoption of products and services that are provided through such solutions, develops slower
than we expect, our growth may slow or stall, and our operating results could be adversely
affected.
Our success depends on companies investing in monetization solutions, including recurring revenue
or consumption management, revenue recognition and subscriber experience software and products, and
consumers choosing to consume products and services through such solutions. Companies may be
unwilling or unable to invest in monetization solutions due to the significant cost of such solutions or if
they do not believe that the consumers of their products and services would be receptive to offerings on
such monetization solutions, or they may choose to invest in such solutions more slowly than we expect.
Our growth also depends, to a large extent, on the willingness of large enterprises that have adopted
recurring revenue or consumption business models utilizing cloud-based products and services to
manage billings and financial accounting relating to their offerings. In addition, those enterprises that do
shift to a recurring revenue model may decide that they do not need a solution that offers the range of
functionalities that we offer. Many companies have invested substantial effort and financial resources to
develop custom-built applications or integrate traditional enterprise software into their businesses as they
adopt recurring revenue business models and may be reluctant or unwilling to switch to different
applications. Factors that may affect market acceptance and sales of our products and services include:
•
the number of companies shifting to recurring revenue business models;
•
the number of consumers and businesses adopting new, flexible ways to consume products and
services;
•
the security capabilities, reliability, and availability of cloud-based services;
•
customer concerns with entrusting a third party to store and manage their data, especially
transaction-critical, confidential, or sensitive data;
•
our ability to minimize the time and resources required to deploy our solutions;
•
our ability to achieve and maintain high levels of customer satisfaction;
•
our ability to deploy upgrades and other changes to our solutions without disruption to our
customers;
•
the level of customization or configuration we offer;
14

•
the overall level of corporate spending and spending on quote-to-revenue solutions by our
customers and prospects, including the impact of spending due to macroeconomic conditions;
•
general macroeconomic conditions, both in domestic and foreign markets, including the impacts
associated with rising interest rates and inflation, slower growth or recession, geopolitical unrest
and developments such as the ongoing conflicts in Ukraine and Israel, changes in China-Taiwan
and U.S.-China relations, bank failures, debt ceiling negotiations, and potential government
shutdowns; and
•
the price, performance, and availability of competing products and services.
The markets for monetization products and services and for monetization software may not develop
further or may develop slower than we expect. If companies do not shift to recurring revenue business
models and monetization software does not achieve widespread adoption, or if there is a reduction in
demand for monetization products and services or monetization software caused by technological
challenges, weakening economic conditions, security or privacy concerns, decreases in corporate
spending, a lack of customer acceptance, or otherwise, our business could be materially and adversely
affected. In addition, our subscription agreements with our customers generally provide for a minimum
monetization platform fee and usage-based fees, which depend on the total dollar amount that is invoiced
or managed on our solutions, or the total usage of our solutions. Because a portion of our revenue
depends on the volume of transactions that our customers process through our solutions, if our customers
do not adopt our solutions throughout their business, if their businesses decline or fail such that they
discontinue using our solutions, or if they are unable to successfully shift to recurring revenue business
models, including if they fail to successfully deploy our solutions, our revenue could decline and our
operation results could be adversely impacted.
If we are unable to grow our sales channels and our relationships with strategic partners,
such as system integrators, management consulting firms, and strategic technology partners,
sales of our products and services may suffer and our growth could be slower than we project.
In addition to our direct sales force, we use strategic partners, such as system integrators,
management consulting firms, and strategic technology partners, to market, sell, and implement our
solutions. Historically, we have used these strategic partners largely with respect to enterprise and
international sales and larger implementations of our products where these partners may have more
expertise and established business relationships than we do. While we expect to continue to utilize our
own professional services, especially for smaller fast-growing companies, we also expect to continue to
transition a portion of our professional services implementations to these strategic partners, and as a
result we expect our professional services revenue as an overall percentage of Zuora’s total revenue to
continue to decline over time. Our relationships with these strategic partners are still maturing, and we
cannot assure you that these partners will be successful in marketing, selling or implementing our
solutions. Identifying these partners, negotiating and supporting relationships with them, including training
them in how to sell or deploy our solutions, and maintaining these relationships requires significant
commitment of time and resources that may not yield a significant return on our investment in these
relationships. Our future growth in revenue and ability to achieve and sustain profitability depends in part
on our ability to identify, establish, and retain successful strategic partner relationships in the United
States and internationally, which will take significant time and resources and involve significant risk. If we
are unable to establish and maintain our relationships with these partners, or otherwise develop and
expand our indirect distribution channel, our business, operating results, financial condition, or cash flows
could be adversely affected.
We also cannot be certain that we will be able to maintain successful relationships with any strategic
partners and, to the extent that our strategic partners are unsuccessful in marketing, selling, or
implementing our solutions, our business, operating results, and financial condition could be adversely
affected. Our strategic partners may market to our customers the products and services of several
different companies, including products and services that compete with our solutions. Because our
strategic partners do not have an exclusive relationship with us, we cannot be certain that they will
prioritize or provide adequate resources to marketing our solutions. Moreover, divergence in strategy by
any of these partners may materially and adversely affect our ability to develop, market, sell, or support
our solutions. We cannot assure you that our strategic partners will continue to cooperate with us. In
15

addition, actions taken or omitted to be taken by such parties may adversely affect us. We are unable to
control the quantity or quality of resources that our systems integrator partners commit to deploying our
products and services, or the quality or timeliness of such deployment. If our partners do not commit
sufficient or qualified resources to these activities, our customers may be less satisfied, or less supportive
with references, or may require the investment of our resources at discounted rates. These, and other
failures by our partners to successfully deploy our products and services, may have an adverse effect on
our business and our operating results.
Our business depends largely on our ability to attract and retain talented employees,
including senior management, and maintain our corporate culture. If we lose the services of Tien
Tzuo, our founder, Chairman, and CEO, or other critical talent across our executive team and in
other key roles, or fail to maintain our corporate culture, we may not be able to execute on our
business strategy.
Our future success depends on our continuing ability to attract, train, engage, assimilate, and retain
highly skilled personnel, including software engineers, product management, sales, and professional
services personnel. We have historically faced intense competition for qualified individuals from numerous
software and other technology companies. Although we have experienced decreased voluntary turnover
since fiscal 2022, we may experience heightened attrition, including of those with significant institutional
knowledge and expertise, adversely impacting productivity and our corporate culture. We may not be able
to retain our current key employees, or attract, train, assimilate, or retain other highly skilled personnel in
the future, especially in light of uncertain macroeconomic and geopolitical conditions globally. For
example, employees may seek new or different opportunities that offer greater compensation or benefits
than we offer or are able to offer, making it difficult to retain them. In addition, we may incur significant
costs to attract and retain highly skilled personnel, and we may lose new employees to our competitors or
other technology companies before we realize the benefit of our investment in recruiting and training
them. If we move into new countries, we will need to attract and recruit skilled personnel in those areas. If
we are unable to attract and retain suitably qualified individuals who are capable of meeting our growing
technical, operational, and managerial requirements on a timely basis or at all, our business may be
adversely affected. Further, given that our employees continue to be distributed globally and most of our
employees continue to work remotely in some capacity, we may find it increasingly difficult to maintain the
beneficial aspects of our corporate culture that is focused on inclusivity and high performance, underlying
the importance of employee connectivity and accountability. Additionally, we may periodically implement
business strategies that impact our employees, including changes to our organizational structure or
workforce adjustments such as our November 2022 and January 2024 workforce reductions. Workforce
reductions or restructurings could have an adverse effect on our business, including creating negative
employee morale, harming our reputation and making it difficult to attract new talent, contributing to
attrition of employees targeted for retention, and hindering our ability to meet operational targets due to
loss of employees. To the extent our compensation programs and workplace culture are not viewed as
competitive, or changes in our workforce or other initiatives are not viewed favorably, our ability to attract,
retain, and motivate employees can be weakened, which could harm our operating results.
In order to attract and retain personnel in a competitive marketplace, we believe that we must provide
a competitive compensation package, including cash and equity-based compensation. Many of our senior
personnel and other key employees hold a substantial amount of equity awards and shares and volatility
or lack of appreciation in our stock price may affect our ability to attract and retain our senior personnel
and key employees. If our stock price is depressed for an extended period of time or if the exercise price
of outstanding stock options are significantly above the market price of our Class A common stock (or,
conversely, if outstanding equity or vested equity awards have significantly appreciated in value),
employees may be more likely to leave us. We therefore may modify our compensation policies by, for
example, increasing cash compensation to certain employees or modifying existing share options. These
modifications of our compensation policies may increase our operating expenses and result in the dilution
of the holders of our ordinary shares. Alternatively, we may elect to reduce equity compensation to
mitigate the effects of dilution, which could adversely impact employee retention. We cannot be certain
that these and any other changes in our compensation policies will or would improve our ability to attract,
retain and motivate employees.
16

Our future success also depends in large part on the continued services of senior management,
including Tien Tzuo, our founder, Chairman and CEO, who is critical to the development of our
technology, platform, future vision, and strategic direction. We also rely on other leaders and key
personnel across our company, including those in our sales, support, operations, and research and
development teams, which are distributed in the U.S. and abroad. Our senior management and other key
personnel are all employed on an at-will basis, which means that they could terminate their employment
with us at any time and for any reason, such as retirement or career change. If we lose the services of
senior management or other key personnel and fail to execute effective succession planning for such key
personnel, or if we are unable to attract, train, assimilate, and retain the highly skilled personnel we need,
our business, operating results, and financial condition could be adversely affected.
The market in which we participate is competitive, and our operating results could be harmed
if we do not compete effectively.
The market for our solutions is highly competitive, rapidly evolving, and fragmented, and subject to
changing technology, shifting customer needs, and frequent introductions of new products and services.
Certain of our current and potential competitors have longer operating histories, access to alternative
fundraising sources, significantly greater financial, technical, marketing, distribution or professional
services experience, or other resources or greater name recognition than we do. In addition, many of our
current and potential competitors supply a wide variety of products to, and have strong and
well-established relationships with, current and potential customers. As a result, our current and potential
competitors may be able to respond more quickly and effectively than we can to new or changing
opportunities, technologies, standards, or customer requirements or devote greater resources than we
can to the development, promotion, and sale of their products and services. In addition, some current and
potential competitors may offer products or services that address one or a limited number of functions at
lower prices or with greater depth than our solutions, or integrate or bundle such products and services
with their other product offerings. Potential customers may prefer to purchase from their existing suppliers
rather than from a new supplier. Our current and potential competitors may develop and market new
technologies with comparable functionality to our solutions. In addition, because our products and
services are integral to our customers’ ability to accurately maintain books and records and prepare
financial statements, our potential customers may prefer to purchase applications that are critical to their
business from one of our larger, more established competitors, or leverage the software that they have
already purchased from our competitors for their billing and accounting needs, or control such
infrastructure internally. We may experience fewer customer orders, reduced gross margins, longer sales
cycles, and loss of market share. This could lead us to decrease prices, implement alternative pricing
structures, or introduce products and services available for free or a nominal price in order to remain
competitive. We may not be able to compete successfully against current and future competitors, and our
business, operating results, and financial condition will be adversely impacted if we fail to meet these
competitive pressures.
Our ability to compete successfully in our market depends on a number of factors, both within and
outside of our control. Some of these factors include: ease of use; recurring revenue-based and
consumption-based product features and functionality; ability to support the specific needs of companies
with recurring revenue, consumption-based, and hybrid business models; ability to integrate with other
technology infrastructures and third-party applications; enterprise-grade performance and features such
as system scalability, security, reliability, performance, effectiveness, and resiliency; vision for the market
and product innovation; relationships with strategic partners, including system integrators, management
consulting firms, and resellers; total cost of ownership; adherence to industry standards and certifications;
strength of sales and marketing efforts; brand awareness and reputation; and customer experience,
including support and professional services. In addition, if we are unable to effectively articulate the value
proposition of our solutions to customers and prospects, we may face difficulties competing in the market
and may fail to attract new customers or lose or fail to maintain or develop our relationships with existing
customers, particularly in the current uncertain macroeconomic environment. Any failure by us to compete
successfully in any one of these or other areas may reduce the demand for our solutions, as well as
adversely affect our business, operating results, and financial condition.
17

Moreover, current and future competitors may also make strategic acquisitions or establish
cooperative relationships among themselves or with others, including our current or future technology
partners. By doing so, these competitors may increase their ability to meet the needs of our customers or
potential customers. These developments could limit our ability to obtain revenue from existing and new
customers. If we are unable to compete successfully against current and future competitors, our business,
operating results, and financial condition could be adversely impacted.
Current and future economic uncertainty and other unfavorable conditions in our industry or
the global economy have limited and may continue to limit our ability to grow our business and
adversely affect our operating results.
Our operating results may vary based on the impact of changes in the U.S. and global economy,
including fluctuations in inflation and interest rates, geopolitical tensions, debt and equity market
fluctuations, diminished liquidity and credit availability, bank failures, debt ceiling negotiations, potential
government shutdowns, recessionary conditions and general economic downturns, which can arise
suddenly, and the full impact of such conditions can be difficult to predict. As a result of ongoing uncertain
macroeconomic conditions, and related corporate cost cutting and tighter budgets, we have experienced
and may continue to experience longer sales cycles and collection periods in some cases. Prolonged
macroeconomic uncertainty could continue to adversely affect the ability or willingness of our current and
prospective customers to purchase or expand their purchase of our products, further delay customer
purchasing decisions, reduce the value of customer contracts, affect attrition rates, or further lengthen
collection periods, any of which could materially and adversely affect our business, operating results,
financial conditions and prospects. We cannot predict the timing, strength, or duration of any economic
downturn. Moreover, any future disruptions in the banking system, both in the U.S. or abroad, may impact
our or our customers’ liquidity and, as a result, adversely impact our business and operating results.
We have a history of net losses and may not achieve or sustain profitability.
We have incurred net losses in each fiscal year since inception, including net losses of $68.2 million,
$198.0 million, and $99.4 million in fiscal 2024, 2023, and 2022, respectively, and may continue to incur
net losses in the future. As we grow, we expect to make additional expenditures related to the
development and expansion of our business, including increasing our overall customer base, expanding
relationships with existing customers, entering new vertical markets, expanding our global footprint,
expanding and leveraging our relationships with strategic partners including system integrators to
accelerate our growth, optimizing pricing and packaging, expanding our operations and infrastructure, and
potentially acquiring other businesses. These efforts may prove more expensive than we currently
anticipate, and we may not succeed in increasing our revenue sufficiently, or at all, to offset these
increased expenses. In addition, we may delay or reevaluate some or all of the foregoing initiatives in the
event that macroeconomic conditions or other factors beyond our control adversely impact our business
or operating results. Any delays or reductions in spending in our business development or expansion
efforts may adversely affect our ability to expand our operations and maintain or increase our sales. While
our revenue has grown in recent years, such results are not indicative of future growth and if our revenue
declines or fails to grow at a rate faster than these increases in our operating expenses, we may not be
able to achieve or maintain profitability in future periods.
Our revenue growth and ability to achieve and sustain profitability will depend, in part, on
being able to increase the productivity of our sales force.
To date, most of our revenue has been attributable to the efforts of our direct sales force. To increase
our revenue and achieve and sustain profitability, we must increase the productivity of our direct sales
force, both in the United States and internationally, to generate additional revenue from new and existing
customers.
Because our solutions are often sold to large enterprises and may involve long sales cycles and
complex customer requirements, there is significant competition for sales personnel with the specific skills
and technical knowledge needed to sell our solutions. Our ability to achieve significant revenue growth
will depend, in large part, on our success recruiting, hiring, training, motivating, and retaining sufficient
numbers of effective sales personnel to support our growth, and such efforts may be difficult and
18

expensive. If we are not able to attract and maintain sufficient numbers of effective sales personnel, our
sales personnel do not reach sufficient levels of productivity on the timelines we have projected or at all,
or our sales personnel are not successful in bringing potential customers into the pipeline, converting
them into new customers, or increasing sales to our existing customer base, our revenue will not increase
at anticipated levels and our ability to achieve long-term projections may be adversely impacted.
We may also be unable to hire or retain sufficient numbers of qualified individuals in the markets
where we operate or plan to operate. Furthermore, hiring sales personnel in new countries requires
additional set up and upfront costs that we may not recover if the sales personnel fail to achieve full
productivity. In addition, as we continue to grow, a larger percentage of our sales force will be new to our
company and our solutions, which may adversely affect our sales if we cannot train our sales force
quickly or effectively. Attrition rates may increase, and we may also face integration challenges inherent in
efficiently managing an increased number of employees over large geographic distances, as we continue
to seek to expand our sales force in the long-term. If we are unable to hire and train sufficient numbers of
effective sales personnel, if attrition increases, or if the sales personnel are not successful in obtaining
new customers or increasing sales to our existing customer base, our business will be adversely affected.
We periodically change and make adjustments to our sales organization in response to market
opportunities, competitive threats, management changes, product and service introductions or
enhancements, acquisitions, sales performance, increases in sales headcount, cost levels, and other
internal and external considerations, including potential changes and uncertainties associated with
macroeconomic conditions or other factors beyond our control. Any future changes in our sales
organization may result in a temporary reduction of productivity, which could adversely affect our rate of
growth. In addition, any significant change to the way we structure our compensation of our sales
organization may be disruptive and may affect our revenue growth.
Our success depends in large part on a limited number of products. If these products,
enhancements to these products, or future products we develop, fail to gain or lose market
acceptance, our business will suffer.
We derive substantially all of our revenue and cash flows from sales of subscriptions and associated
deployment of our Zuora Billing, Zuora Revenue, Zuora Payments, Zephr, and Zuora Platform products.
The continued growth in market demand for these products is critical to our success and may be
impacted by a number of factors outside of our control, including macroeconomic factors, such as the
impacts of inflation and rising interest rates on our customers and prospects, the growth or contraction of
recurring revenue business models by our customers and prospects, continued market acceptance of our
solutions by customers for existing and new use cases, the timing of development and release of new
products and services, features, and functionality introduced by our competitors, changes in accounting
standards, laws or regulations, policies, guidelines, interpretations, or principles that would impact the
functionality and use of our solutions, and technological change. We expect that an increasing transition
to disaggregated solutions that focus on addressing specific customer use cases would continue to
disrupt the enterprise software space, enabling new competitors to emerge. We cannot assure you that
our solutions, future enhancements to our solutions, or new products we develop or add to our portfolio as
a result of future acquisitions, will be able to address future advances in technology or the requirements of
enterprise customers. If we are unable to meet customer demands in creating flexible solutions designed
to address all these needs or otherwise achieve more widespread market acceptance of our solutions,
our business, operating results, financial condition, and growth prospects would be adversely affected.
Currency exchange rate fluctuations may adversely affect our operating results.
Our international operations expose us to the effects of fluctuations in currency exchange rates, and
may increase the cost of our solutions to customers outside of the United States when the U.S. Dollar is
stronger relative to other currencies. Currency exchange rate fluctuations have and may adversely affect
our business, operating results, financial condition, and cash flows.
In addition, we incur expenses for employee compensation and other operating expenses at our
non-U.S. locations in the local currency. Fluctuations in the exchange rates between the U.S. Dollar and
other currencies could result in the dollar equivalent of such expenses being higher. Furthermore, volatile
19

market conditions arising from current and potential future macroeconomic conditions and geopolitical
events may result in significant fluctuations in exchange rates, and, in particular, a weakening of foreign
currencies relative to the U.S. Dollar may adversely affect our revenue. This could have an adverse
impact on our operating results. Although we may in the future decide to undertake foreign exchange
hedging transactions to cover a portion of our foreign currency exchange exposure, we currently do not
hedge our exposure to foreign currency exchange risks.
We face risks related to our debt obligations.
We have issued $400.0 million aggregate principal amount of convertible senior unsecured notes due
in 2029 (the 2029 Notes) and warrants for 7.5 million shares of our Class A common stock (the Warrants)
to Silver Lake Alpine II, L.P. (Silver Lake).
Our debt obligations under the 2029 Notes could adversely impact us. For example, these obligations
could:
•
require us to use a substantial portion of our cash flow from operations to pay principal and
interest on debt, or to repurchase the 2029 Notes when required upon the occurrence of certain
events or otherwise pursuant to the terms thereof, which will reduce or exhaust the amount of
cash flow available to fund working capital, capital expenditures, acquisitions, and other
business activities and could require us to seek additional financing that may not be available on
favorable terms, or at all;
•
require us to use cash and/or issue shares of our Class A common stock to settle any
obligations;
•
result in certain of our debt instruments being accelerated or being deemed to be in default if
certain terms of default are triggered, such as applicable cross payment default and/or
cross-acceleration provisions;
•
adversely impact our credit rating, which could increase future borrowing costs;
•
limit our future ability to raise funds for capital expenditures, strategic acquisitions or business
opportunities, and other general corporate requirements;
•
restrict our ability to create or incur liens and engage in other transactions and activity;
•
increase our vulnerability to adverse economic and industry conditions;
•
dilute our outstanding Class A common stock, which, to the extent we generate net income, may
negatively impact earnings per share, as a result of the conversion provisions in the 2029 Notes;
and
•
place us at a competitive disadvantage compared to our less leveraged competitors.
Additionally, due to certain settlement provisions associated with the 2029 Notes and Warrants, we
have classified all of the Warrants and a portion of the debt conversion option as a current liability and
revalue these liabilities on a quarterly basis, which may adversely affect our future operating results and
financial condition as reported on a GAAP basis.
We also have a $30.0 million revolving credit facility, which is currently undrawn, under an agreement
with Silicon Valley Bank, a division of First-Citizens Bank & Trust. The credit facility contains restrictive
covenants, including limitations on our ability to transfer or dispose of assets, merge with other companies
or consummate certain changes of control, acquire other companies, pay dividends or repurchase our
stock, incur additional indebtedness and liens and enter into new businesses. We therefore may not be
able to engage in any of the foregoing transactions unless we obtain the consent of the lender or
terminate the credit facility. Failure to comply with the covenants or other restrictions could result in a
default. In addition, the credit facility is secured by substantially all of our non-intellectual property assets
and requires us to satisfy certain financial covenants.
Our ability to meet our payment obligations under our debt instruments depends on our ability to
generate significant cash flows in the future. This, to some extent, is subject to market, economic,
financial, competitive, legislative, and regulatory factors as well as other factors that are beyond our
20

control. There can be no assurance that our business will generate cash flow from operations, or that
additional capital will be available to us, either on favorable terms or in amounts sufficient to enable us to
meet our debt payment obligations and to fund other liquidity needs. For example, we may utilize
proceeds from the 2029 Notes for acquisitions or other investments or for other corporate purposes, such
as purchases of our outstanding common stock. Any such actions may not increase our enterprise value.
If we are unable to generate sufficient cash flow to service our debt obligations, we may be required to
adopt one or more alternatives, such as reducing or delaying investments or capital expenditures, selling
assets, refinancing or obtaining additional capital on terms that may be onerous or highly dilutive. Our
ability to refinance the 2029 Notes, our revolving credit facility or future indebtedness will depend on
market conditions and our financial condition at such time. We may not be able to engage in any of these
activities on desirable terms, or at all, which could result in a default on our debt obligations. Any such
default could have a material adverse effect on our business and financial condition. See Note 9. Debt
and Note 17. Warrants to Purchase Shares of Common Stock of the Notes to Consolidated Financial
Statements for more information about the 2029 Notes, Warrants and the revolving credit facility.
Our operating results may fluctuate from quarter to quarter, which makes our future results
difficult to predict.
Our quarterly operating results have fluctuated in the past and may fluctuate in the future. As a result,
you should not rely upon our past quarterly operating results as indicators of future performance. We
have encountered, and will continue to encounter, risks and uncertainties frequently experienced by
growing companies in rapidly evolving markets, such as the risks and uncertainties described herein. Our
operating results in any given quarter can be influenced by numerous factors, many of which are
unpredictable or are outside of our control, including:
•
our ability to maintain and grow our customer base and convert our pipeline into paying
customers;
•
our ability to retain and increase revenue from existing customers;
•
our ability to introduce new products and services and enhance existing products and services;
•
our ability to integrate or implement our existing products and services on a timely basis or at all;
•
our ability to deploy our products successfully within our customers’ information technology
ecosystems;
•
increases or decreases in subscriptions to our platform;
•
our ability to sell to large enterprise customers and fast-growing companies;
•
the transaction volume that our customers process through our system;
•
our ability to respond to competitive developments, including competitors’ pricing changes and
their introduction of new products and services;
•
macroeconomic conditions, including the impact of foreign exchange fluctuations and rising
interest rates and inflation, including wage inflation;
•
changes in the pricing of our products;
•
the productivity of our sales force;
•
our ability to grow our relationships with strategic partners such as system integrators and their
effectiveness in increasing our sales and implementing our products;
•
changes in the mix of products and services that our customers use;
•
the length and complexity of our sales cycles;
•
cost to develop and upgrade our solutions to incorporate new technologies;
•
seasonal purchasing patterns of our customers;
•
the impact of outages of our solutions and reputational harm;
21

•
costs related to the acquisition of businesses, talent, technologies, or intellectual property,
including potentially significant amortization costs and possible write-downs;
•
failures or breaches of security or privacy, and the costs associated with responding to and
addressing any such failures or breaches;
•
changes to financial accounting standards and the interpretation of those standards that may
affect the way we recognize and report our financial results, including changes in accounting
rules governing recognition of revenue;
•
general economic and political conditions and government regulations in the countries where we
currently operate or plan to expand;
•
decisions by us to incur additional expenses, such as increases in sales and marketing or
research and development;
•
the timing of stock-based compensation expense;
•
political unrest, changes and uncertainty associated with terrorism, hostilities, war (including the
ongoing conflicts in Ukraine and Israel), natural disasters, pandemics, and continuing disruptions
to the global banking system; and
•
potential costs to attract, onboard, retain, and motivate qualified personnel.
The impact of one or more of the foregoing and other factors may cause our operating results to vary
significantly. As such, we believe that quarter-to-quarter comparisons of our operating results may not be
meaningful and should not be relied upon as an indication of future performance. If we fail to meet or
exceed the expectations of investors or securities analysts, or perform below any guidance we may
provide, then the trading price of our Class A common stock could fall substantially, and we could face
costly lawsuits, including shareholder litigation.
The growth forecasts that we have provided publicly may prove to be inaccurate, and even if
the markets in which we compete achieve the forecasted growth, our business could fail to grow
at similar rates, if at all.
Growth forecasts are subject to significant uncertainty and are based on assumptions and estimates
that may not prove to be accurate. The forecasts we have provided publicly relating to the expected
growth of the markets in which we compete may prove to be inaccurate due to unforeseen or
unanticipated events. Even if these markets experience the growth we forecast, we may not grow our
business at similar rates, or at all. Our growth is subject to many factors, including our success in
executing our business strategy, which is subject to many risks and uncertainties. Accordingly, the
forecasts of market growth we have provided publicly should not be taken as indicative of our future
growth.
If we are not able to develop and release new products and services, or successful
enhancements, new features, and modifications to our existing products and services, or
otherwise successfully implement our multi-product strategy, our business could be adversely
affected.
Our industry and the market for our solutions are characterized by rapid technological change and
innovations (such as the use of AI and machine learning technologies), frequent new product and service
introductions and enhancements, changing customer demands, and evolving industry standards. If we
are unable to develop new products that achieve market acceptance, provide enhancements and new
features, or innovate quickly enough to keep pace with these rapid technological developments, our
business could be harmed. Additionally, because we provide billing and finance solutions to help our
customers with compliance and financial reporting, changes in law, regulations, and accounting standards
could impact the usefulness of our products and services and could necessitate changes or modifications
to our products and services to accommodate such changes. Monetization products and services,
including our billing, payments and revenue recognition offerings, are inherently complex, and our ability
to implement our multi-product strategy, including developing, releasing, marketing and selling new
products and services or enhancements, new features and modifications to our existing products and
22

services depends on several factors, including our internal departments aligning their respective
responsibilities, timely completion, competitive pricing, adequate quality testing, integration with new and
existing technologies and our solutions, and overall market acceptance. We cannot be sure that we will
succeed in developing, marketing, and delivering on a timely and cost-effective basis enhancements or
improvements to our platform or any new products and services that respond to continued changes in
monetization practices or new customer requirements, nor can we be sure that any enhancements or
improvements to our platform or any new products and services will achieve market acceptance. Since
developing our solutions is complex, the timetable for the release of new products and enhancements to
existing products is difficult to predict, and we may not offer new products and updates as rapidly as our
customers require or expect. In addition, our product development efforts could be delayed or otherwise
adversely impacted if there is an adverse geopolitical event in the countries where we operate, including
in China where we have a sizable number of research and development employees. Any new products or
services that we develop may not be introduced in a timely or cost-effective manner, may contain errors
or defects, or may not achieve the broad market acceptance necessary to generate sufficient revenue.
The introduction of new products and enhancements could also increase costs associated with customer
support and customer success as demand for these services increase. This increase in cost could
adversely impact profit margins, including our gross margin. Moreover, even if we introduce new products
and services, we may experience a decline in revenue of our existing products and services that is not
offset by revenue from the new products or services. For example, customers may delay making
purchases of new products and services to permit them to make a more thorough evaluation of these
products and services or until industry and marketplace reviews become widely available. Some
customers may hesitate to migrate to a new product or service due to concerns regarding the complexity
of migration or performance of the new product or service. In addition, we may lose existing customers
who choose a competitor’s products and services or choose to utilize internally developed applications
instead of our products and services. This could result in a temporary or permanent revenue shortfall and
adversely affect our business.
In addition, because our products and services are designed to interoperate with a variety of other
internal or third-party software products and business systems applications, we will need to continuously
modify and enhance our products and services to keep pace with changes in APIs, and other software
and database technologies. We may not be successful in either developing these new products and
services, modifications, and enhancements or in bringing them to market in a timely fashion. There is no
assurance that we will successfully resolve such issues in a timely and cost-effective manner.
Furthermore, modifications to existing platforms or technologies, including any APIs with which we
interoperate, will increase our research and development expenses. Any failure of our products and
services to operate effectively with each other or with other platforms and technologies could reduce the
demand for our products and services, result in customer dissatisfaction, and adversely affect our
business.
We may acquire or invest in additional companies, which may divert our management’s
attention, result in additional dilution to our stockholders, and consume resources that are
necessary to sustain our business. We may be unable to integrate acquired businesses and
technologies successfully or to achieve the expected benefits of such acquisitions.
Our business strategy includes acquiring other complementary products, technologies, or
businesses, such as our acquisition of Zephr Inc Limited (Zephr) in September 2022. An acquisition,
investment, or business relationship may result in unforeseen operating difficulties and expenditures. In
particular, we may encounter difficulties assimilating or integrating the businesses, technologies,
products, personnel, or operations of the acquired companies, particularly if the key personnel of the
acquired companies choose not to work for us, if an acquired company’s software is not easily adapted to
work with ours, or if we have difficulty retaining the customers of any acquired business due to changes in
management or otherwise.
Acquisitions may also disrupt our business, divert our resources, and require significant management
attention that would otherwise be available for other business development activities. Moreover, the
anticipated benefits of any acquisition, investment, or business relationship may not be realized or we
may be exposed to unknown liabilities. We may in the future acquire or invest in additional businesses,
products, technologies, or other assets. We also may enter into relationships with other businesses to
23

expand our products and services or our ability to provide our products and services in foreign
jurisdictions, which could involve preferred or exclusive licenses, additional channels of distribution,
discount pricing, or investments in other companies. Negotiating these transactions can be time
consuming, difficult, and expensive, and our ability to close these transactions may be subject to
approvals that are beyond our control. In addition, we have limited experience in acquiring other
businesses. We may be unable to find and identify desirable acquisition targets, may incorrectly estimate
the value of a target, may fail to conduct effective due diligence on a target to identify problems or
incompatibilities or obstacles to integration, or may not be successful in entering into an agreement with
any particular target. Consequently, these transactions, even if undertaken and announced, may not
close. For any transactions we undertake, we may:
•
issue additional equity securities that would dilute our stockholders;
•
use cash that we may need in the future to operate our business;
•
incur debt on terms unfavorable to us or that we are unable to repay;
•
incur large charges or substantial liabilities;
•
encounter difficulties retaining key employees of the acquired company or integrating diverse
software codes or business cultures; and
•
become subject to adverse tax consequences, substantial depreciation, or deferred
compensation charges.
Any of these risks could adversely impact our business and operating results.
A customer’s failure to deploy our solutions after it enters into a subscription agreement with
us, or the incorrect or improper deployment or use of our solutions could result in customer
dissatisfaction, harm our reputation and brand, and adversely affect our business, operating
results, financial condition, and growth prospects.
Our solutions are deployed in a wide variety of technology environments and into a broad range of
complex workflows. We believe our future success will depend in part on our ability to increase both the
speed and success of our deployments, by improving our deployment methodology, hiring and training
qualified professionals, deepening relationships with deployment partners, and increasing our ability to
integrate into large-scale, complex technology environments. We often assist our customers in deploying
our solutions, either directly or through our deployment partners. In other cases, customers rely on
third-party partners to complete the deployment. In some cases, customers initially engage us to deploy
our solutions, but, for a variety of reasons, including strategic decisions not to utilize recurring revenue
business models, fail to ultimately deploy our solutions. If we or our third-party partners are unable to
deploy our solutions successfully, or unable to do so in a timely manner and, as a result, customers do
not utilize our solutions, we would not be able to generate future revenue from such customers based on
transaction or revenue volume and the upsell of additional products and services, and our future
operating results could be adversely impacted. In addition, customers may also seek refunds of their
initial subscription fee. Moreover, customer perceptions of our solutions may be impaired, our reputation
and brand may suffer, and customers may choose not to renew or expand their use of our solutions.
As a portion of our sales efforts are targeted at large enterprise customers, our sales cycle for
these customers may become longer and more expensive, we may encounter still greater pricing
pressure and deployment and customization challenges, and we may have to delay revenue
recognition for more complicated transactions, all of which could adversely impact our business
and operating results.
As a portion of our sales efforts are targeted at large enterprise customers, we may face greater
costs, longer sales cycles, and less predictability in the completion of our sales to these customers. In this
market segment, the customer’s decision to use our solutions may be an enterprise-wide decision, in
which case these types of sales frequently require approvals by multiple departments and executive-level
personnel and require us to provide greater levels of customer education regarding the uses and benefits
of our solutions, as well as education regarding security, privacy, and scalability of our solutions,
especially for large ‘‘business to consumer’’ customers or those with extensive international operations.
24

These large enterprise transactions might also be part of a customer’s broader business model or
business systems transformation project, which are frequently subject to budget constraints, multiple
approvals, and unplanned administrative, processing, security review, and other delays that could further
lengthen the sales cycle. Larger enterprises typically have longer decision-making and deployment
cycles, may have greater resources to develop and maintain customized tools and applications, demand
more customization, require greater functionality and scalability, expect a broader range of services,
demand that vendors take on a larger share of risks, demand increased levels of customer service and
support, require acceptance provisions that can lead to a delay in revenue recognition, and expect greater
payment flexibility from vendors. We are often required to spend time and resources to better familiarize
potential customers with the value proposition of our solutions. As a result of these factors, sales
opportunities with large enterprises may require us to devote greater sales and administrative support and
professional services resources to individual customers, which could increase our costs, lengthen our
sales cycle, and divert our sales and professional services resources to a smaller number of larger
customers. We may spend substantial time, effort, and money in our sales, design and implementation
efforts without being successful in producing any sales or deploying our products in such a way that is
satisfactory to our customers. All these factors can add further risk to business conducted with these
customers. In addition, if sales expected from a large customer for a particular quarter are not realized in
that quarter or at all, our business, operating results, and financial condition could be materially and
adversely affected.
Furthermore, our sales and implementation cycles could be interrupted or affected by other factors
outside of our control. For example, due to global economic uncertainty, rising inflation and interest rates,
and foreign exchange fluctuations, many large enterprises have generally reduced or delayed technology
or other discretionary spending, which may materially and adversely impact our operating results,
financial condition and prospects.
Our long-term success depends, in part, on our ability to expand the sales of our solutions to
customers located outside of the United States. Our current international operations, and any
further expansion of those operations, expose us to risks that could have a material adverse
effect on our business, operating results, and financial condition.
We conduct our business activities in various foreign countries and have operations in North
America, Europe, Asia, and Australia. During the fiscal year ended January 31, 2024, we derived
approximately 36% of our total revenue from customers located outside the United States. Our ability to
manage our business and conduct our operations internationally requires considerable management
attention and resources and is subject to the particular challenges of supporting a rapidly growing
business in an environment of multiple cultures, customs, legal systems, regulatory systems, and
commercial infrastructures. International expansion requires us to invest significant funds and other
resources. Our operations in international markets may not develop at a rate that supports our level of
investment. Our international operations, including any future expansion, may subject us to risks,
including with:
•
recruiting and retaining talented and capable employees in foreign countries;
•
efficiently managing employees over large geographic distances;
•
maintaining our company culture with a dispersed workforce;
•
providing our solutions to customers from different cultures, which may require us to adapt sales
practices, modify our solutions, and provide features necessary to effectively serve the local
market;
•
compliance with multiple, conflicting, ambiguous or evolving governmental laws and regulations
and court decisions, including those relating to employment matters, e-invoicing, consumer
protection, intellectual property, privacy, data protection, information security, data residency, and
encryption;
•
investing in infrastructure, typically well in advance of revenue generation;
•
longer sales cycles in some countries;
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•
generally longer payment cycles and greater difficulty in collecting accounts receivable;
•
credit risk and higher levels of payment fraud;
•
weaker privacy and intellectual property protection in some countries, including China and India;
•
compliance with anti-bribery laws, such as the U.S. Foreign Corrupt Practices Act of 1977, as
amended (FCPA) and the UK Bribery Act 2010 (UK Bribery Act);
•
currency exchange rate fluctuations and inflationary pressure;
•
tariffs, export and import restrictions, restrictions on foreign investments, sanctions, and other
trade barriers or protection measures;
•
foreign exchange controls that might prevent us from repatriating cash earned outside the United
States;
•
economic instability and inflationary conditions;
•
political instability and unrest, including the effects of the ongoing conflicts in Ukraine and Israel,
especially as it impacts countries in Europe, and changes in the public perception of
governments in the countries where we operate or plan to operate;
•
corporate espionage;
•
treatment of revenue from international sources and compliance with the laws of numerous
taxing jurisdictions, both foreign and domestic, in which we conduct business, potential double
taxation of our international earnings, and potentially adverse tax consequences due to changes
in applicable U.S. and foreign tax laws;
•
continuing uncertainty regarding social, political, immigration, and tax and trade policies in the
U.S. and abroad;
•
disruptions to the U.S. and international banking systems;
•
increased costs to establish and maintain effective controls at foreign locations; and
•
overall higher costs of doing business internationally.
In addition, geopolitical tensions in countries where we operate may increase our costs of or
otherwise prevent us from operating in these countries. If authorities in these locations impose costly or
overly burdensome requirements or other sanctions, we may not be able to continue or may need to limit
our operations in these countries. For example, we have approximately 150 employees in China, of which
most are on our research and development and engineering operations teams. If trade relations between
the U.S. and China continue to deteriorate or if sanctions or other regulatory requirements are imposed
on our operations in China, it could negatively impact our business operations, product development
plans, operating results, and financial condition.
If we fail to offer high-quality support and training to our customers and third-party partners,
our business and reputation will suffer.
High-quality education, training and support for our customers and third-party partners is important
for the successful marketing and sale of our products to new customers and to maintain and expand our
relationship with existing customers. The importance of high-quality customer and third-party partner
training and support will increase as we expand our business and pursue new customers. As we add or
integrate new services to our portfolio (such as with our acquisition of Zephr), and as we expand
internationally, we and our third-party partners may experience challenges in accurately assessing the
capabilities of, and providing technical support for, such services. In addition, we are unable to control our
third-party partners and therefore cannot control the speed or effectiveness of their support services,
which could harm our reputation. If we or our third-party partners do not help our customers quickly
resolve post-deployment technical and operational issues related to our platform, including configuring
and using features, and provide them with effective ongoing customer support, our ability to upsell
additional products to existing customers could suffer and our reputation with existing or potential
customers could be harmed.
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Future changes in market conditions or customer demand could require changes to our
prices or pricing model, which could adversely affect our business, operating results, and
financial condition.
We generally charge our customers a flat fee for their use of our platform and modules and a variable
fee based on the amount of transaction volume they process through our system and the number of their
subscribers. If our customers do not increase their transaction volume or the number of their subscribers,
or an event outside of our control, such as an economic downturn, reduces their transaction volume or the
number of their subscribers, our revenue may be adversely impacted by customers reducing their
contracted transaction volume. We have limited experience with respect to determining the optimal prices
for our platform, and, as a result, we have in the past needed to, and expect in the future to need to,
change our pricing model from time to time. As the market for our products matures, or as new
competitors introduce new products or services that compete with ours or reduce their prices, we may be
unable to attract or retain customers at the same price or based on the same pricing models as we have
used historically. We may experience pressure to change our pricing model to defer fees until our
customers have fully deployed our solutions. Moreover, larger organizations, which comprise a large and
growing component of our sales efforts, may demand substantial price concessions. As a result, in the
future, we may be required to reduce our prices or change our pricing model, which could adversely affect
our revenue, gross margin, profitability, financial position, and cash flow.
If we fail to integrate our solutions with a variety of operating systems, software applications,
and hardware platforms that are developed by others, our solutions may become less marketable,
less competitive, or obsolete, and our operating results may be adversely affected.
Our solutions must integrate with a variety of network, hardware, and software platforms, and we
need to continuously modify and enhance our solutions to adapt to changes in cloud-enabled hardware,
software, networking, browser, and database technologies. We have developed our solutions to be able
to integrate with third-party SaaS applications, including the applications of software providers that
compete with us, by utilization of APIs. In general, we rely on the fact that the providers of such software
systems, including Salesforce, continue to allow us access to their APIs to enable these integrations, and
the terms with such companies may be subject to change from time to time. We also integrate certain
aspects of our solutions with other platform providers. We may not be successful in either developing
necessary modifications and enhancements or resolving interoperability issues in a timely and
cost-effective manner. Any failure of our products and services to continue to operate effectively with
third-party infrastructures and technologies, as well as any change or deterioration in our relationship with
any platform provider, may reduce the demand for our products and services, resulting in dissatisfaction
of our customers, and may materially and adversely impact our business and operating results.
Our business may be adversely impacted if any platform provider:
•
discontinues or limits our access to its APIs;
•
makes changes to its platform;
•
terminates or does not allow us to renew or replace our contractual relationship;
•
modifies its terms of service or other policies, including fees charged to, or other restrictions on,
us or other application developers, or changes how customer information is accessed by us or
our customers;
•
establishes more favorable relationships with one or more of our competitors, or acquires one or
more of our competitors or is acquired by a competitor and offers competing services to us; or
•
otherwise develops its own competitive offerings.
In addition, we have benefited from these platform providers’ brand recognition, reputations, and
customer bases. Any losses or shifts in the market position of these platform providers in general, in
relation to one another or to new competitors or new technologies could lead to losses in our relationships
or customers, or to our need to identify or transition to alternative channels for marketing our solutions.
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Such changes could consume substantial resources and may not be effective. If we are unable to
respond to changes in a cost-effective manner, our solutions may become less marketable, less
competitive, or obsolete and our operating results may be adversely impacted.
If we fail to develop, maintain, and enhance our brand and reputation cost-effectively, our
business and financial condition may be adversely affected.
We believe that developing, maintaining, and enhancing awareness and integrity of our brand and
reputation in a cost-effective manner are important to achieving widespread acceptance of our solutions
and are important elements in attracting new customers and maintaining existing customers. We believe
that the importance of our brand and reputation will increase as competition in our market further
intensifies. Successful promotion of our brand and the Subscription Economy concept will depend on the
effectiveness of our marketing efforts, our ability to provide reliable and useful solutions at competitive
prices, the perceived value of our solutions, and our ability to provide quality customer support. In
addition, the promotion of our brand requires us to make substantial expenditures, and we anticipate that
our expenditures will increase as our market becomes more competitive, as we expand into new markets,
and as more sales are generated through our strategic partners. Brand promotion activities may not yield
increased revenue, and even if they do, the increased revenue may not offset the expenses we incur in
building and maintaining our brand and reputation. We also rely on our customer base and community of
end-users in a variety of ways, including to give us feedback on our solutions and to provide user-based
support to our other customers. If we fail to promote and maintain our brand successfully or to maintain
loyalty among our customers, or if we incur substantial expenses in an unsuccessful attempt to promote
and maintain our brand, we may fail to attract new customers and partners or retain our existing
customers and partners and our business and financial condition may be adversely affected. Any negative
publicity relating to our customers, employees, partners, or others associated with these parties, may also
tarnish our own reputation simply by association and may reduce the value of our brand. Damage to our
brand and reputation may result in reduced demand for our solutions and increased risk of losing market
share to our competitors. Any efforts to restore the value of our brand and rebuild our reputation may be
costly and may not be successful.
We employ third-party licensed software for use in or with our software, and the inability to
maintain these licenses or errors in the software we license could result in increased costs or
reduced service levels, which could adversely affect our business.
Our software incorporates certain third-party software obtained under licenses from other companies.
We anticipate that we will continue to rely on such third-party software and development tools from third
parties in the foreseeable future. Although we believe that there are commercially reasonable alternatives
to the third-party software we currently license, including open source software, this may not always be
the case, or it may be difficult or costly to migrate to other third-party software. Our use of additional or
alternative third-party software would require us to enter into license agreements with third parties. In
addition, integration of our software with new third-party software may require significant work and require
substantial investment of our time and resources. Also, any undetected or uncorrected errors or defects in
third-party software could prevent the deployment or impair the functionality of our software, present
security risks, delay new updates or enhancements to our solutions, result in a failure of our solutions,
and harm our reputation.
Certain of our operating results and financial metrics may be difficult to predict as a result of
seasonality.
Although we have not historically experienced significant seasonality with respect to our subscription
revenue throughout the year, we have seen seasonality in our sales cycle as a large percentage of our
customers make their purchases in the third month of any given quarter. In addition, our fourth quarter
has historically been our strongest quarter. We believe that this results in part from the procurement,
budgeting, and deployment cycles of many of our customers. We generally expect a relative increase in
sales in the second half of each year as budgets of our customers for annual capital purchases are being
fully utilized. We may be affected by seasonal trends in the future, particularly as our business matures
and diversifies. Such seasonality may result from a number of factors, including a slowdown in our
customers’ procurement process during certain times of the year, both domestically and internationally,
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and customers choosing to spend remaining budgets shortly before the end of their fiscal years. These
effects may become more pronounced as we target larger organizations and their larger budgets for sales
of our solutions. Additionally, this seasonality may be reflected to a much lesser extent, and sometimes
may not be immediately apparent, in our revenue, due to the fact that we recognize subscription revenue
over the term of the applicable subscription agreement. In addition, our ability to record professional
services revenue can potentially vary based on the number of billable days in the given quarter, which is
impacted by holidays and vacations. To the extent we experience this seasonality, it may cause
fluctuations in our operating results and financial metrics and make forecasting our future operating
results and financial metrics more difficult.
Risks Related to Information Technology, Intellectual Property, and Data Security and Privacy
If our security measures are breached or if unauthorized access to customer, employee or
other confidential data is otherwise obtained, or if our solutions are perceived as not being
secure, we may lose existing customers or fail to attract new customers, our business may be
harmed and we may incur significant liabilities.
Our solutions involve the storage, transmission and processing of our customers’ proprietary data,
including highly confidential financial information regarding their business, and personal or confidential
information of our customers’ customers or other end users. Additionally, we maintain our own proprietary,
confidential and otherwise sensitive information, including employee information. While we have security
measures in place designed to protect customer information and prevent data loss and other security
breaches, these measures may be breached as a result of third-party action, including cyberattacks or
other intentional misconduct by computer hackers, employee error, malfeasance or otherwise. The risk of
a cybersecurity incident occurring has increased as more companies and individuals work remotely,
potentially exposing us to new, complex threats. Additionally, due to political uncertainty and military
actions such as those associated with the conflicts in Ukraine and Israel, we and our service providers are
vulnerable to heightened risks of cybersecurity incidents and security and privacy breaches from or
affiliated with nation-state actors. If any unauthorized or inadvertent access to, or a security breach or
incident impacting our platform or other systems or networks used in our business occurs, such event
could result in the loss, alteration, or unavailability of data, unauthorized access to, or use or disclosure of
data, and any such event, or the belief or perception that it has occurred, could result in a loss of
business, severe reputational damage adversely affecting customer or investor confidence, regulatory
investigations and orders, litigation, indemnity obligations, and damages for contract breach or penalties
for violation of applicable laws or regulations.
Service providers who store or otherwise process data on our behalf, including third party and
public-cloud infrastructure, also face security risks. As we rely more on third-party and public-cloud
infrastructure and other third-party service providers, we will become more dependent on third-party
security measures to protect against unauthorized access, cyberattacks and the mishandling of customer,
employee and other confidential data and we may be required to expend significant time and resources to
address any incidents related to the failure of those third-party security measures. Our ability to monitor
our third-party service providers’ data security is limited, and in any event, attackers may be able to
circumvent our third-party service providers’ data security measures. There have been and may continue
to be significant attacks on certain third-party providers, and we cannot guarantee that our or our
third-party providers’ systems and networks have not been breached or otherwise compromised, or that
they do not contain exploitable defects or bugs that could result in a breach of or disruption to our
systems and networks or the systems and networks of third parties that support us and our platform. We
may also suffer breaches of, or incidents impacting, our internal systems. Security breaches or incidents
impacting our platform or our internal systems could also result in significant costs incurred in order to
remediate or otherwise respond to a breach or incident, which may include liability for stolen assets or
information and repair of system damage that may have been caused, incentives offered to customers or
other business partners in an effort to maintain business relationships after a breach, and other costs,
expenses and liabilities. We may be required to or find it appropriate to expend substantial capital and
other resources to alleviate problems caused by any actual or perceived security breaches or incidents.
Additionally, the SEC and many jurisdictions have enacted or may enact laws and regulations
requiring companies to disclose or otherwise provide notifications regarding data security breaches.
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These or other disclosures regarding a security breach or incident could result in negative publicity to us,
which may cause our customers to lose confidence in the effectiveness of our data security measures
which could impact our operating results.
Despite our investments into measures designed to minimize the risk of security breaches, we are
subject to the risk of security incidents or breaches. If a high profile security breach or incident occurs with
respect to us, another Software as a Service (SaaS) provider or other technology company, our current
and potential customers may lose trust in the security of our solutions or in the SaaS business model
generally, which could adversely impact our ability to retain existing customers or attract new ones. Such
a breach or incident, or series of breaches or incidents, could also result in regulatory or contractual
security requirements that could make compliance challenging. Even in the absence of any security
breach or incident, customer concerns about privacy, security, or data protection may deter them from
using our platform for activities that involve personal or other sensitive information.
Because the techniques used to obtain unauthorized access or to sabotage systems change
frequently, and often are not identified until they are launched against a target, we may be unable to
anticipate these techniques or to implement adequate preventative measures. We may also experience
security breaches and incidents that may remain undetected for an extended period of time. Periodically,
we experience cyber security events including ‘‘phishing’’ attacks targeting our employees, web
application and infrastructure attacks and other information technology incidents. These threats continue
to evolve in sophistication and volume and are difficult to detect and predict due to advances in electronic
warfare techniques, new discoveries in the field of cryptography and new and sophisticated methods used
by criminals including phishing, social engineering or other illicit acts. There can be no assurance that our
defensive measures will prevent cyberattacks or other security breaches or incidents, and any such
attacks, breaches or incidents could damage our brand and reputation and adversely impact our
business.
Because data security is a critical competitive factor in our industry, we make numerous statements
in our privacy policy and customer agreements, through our certifications to standards and in our
marketing materials regarding the security of our platform including detailed descriptions of security
measures we employ. If we fail to adhere to our stated security standards, even through circumstances
beyond our reasonable control, we may face claims of misrepresentation or deceptiveness by the U.S.
Federal Trade Commission, state and foreign regulators and private litigants. Our insurance policies
covering certain security and privacy damages and claim expenses may not be sufficient to compensate
for all potential liability. Although we maintain cyber liability insurance, we cannot be certain that our
coverage will be adequate for liabilities actually incurred, or that insurance will continue to be available to
us on economically reasonable terms, or at all.
In addition, like many similarly situated technology companies, we have a sizable number of research
and development and other personnel located outside the United States, including in China, which has
exposed and could continue to expose us to governmental and regulatory, as well as market and media,
scrutiny, regarding the actual or perceived integrity of our platform or data security and privacy features.
Any actual or perceived security compromise could reduce customer confidence in the effectiveness of
our security measures, adversely affect our ability to attract new customers, and cause existing
customers to reduce the use or stop using our solutions, any of which could harm our business and
reputation.
Privacy and security concerns, laws, and regulations, may adversely affect our business.
Governments and agencies worldwide have adopted or may adopt laws and regulations regarding
the collection, use, storage, data residency, security, disclosure, transfer across borders and other
processing of information obtained from individuals within jurisdictions. These laws and regulations
increase the costs and burdens of compliance, including the ability to transfer information from, or a
requirement to store in, particular jurisdictions and could:
•
impact our ability to offer our products and services in certain jurisdictions,
•
decrease demand for or require us to modify or restrict our product or services, or
•
impact our customers’ ability and willingness to use, adopt and deploy our solutions globally.
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Compliance burdens or our inability to comply with such laws, regulations, and other obligations,
could lead to reduced overall demand and impair our ability to maintain and grow our customer base and
increase our revenue. We may be unable to make changes that are necessary or appropriate to address
changes in laws, regulations, or other obligations in a commercially reasonable manner, in a timely
fashion, or at all.
Additionally, laws and regulations relating to the processing of information can vary significantly
based on the jurisdiction. Some regions and countries have or are enacting strict laws and regulations,
including the European Union (EU), China, Australia, and India, as well as states within the United States,
such as California, that may create conflicts, obligations or inconsistent compliance requirements. Despite
our efforts to comply with these varying requirements, a regulator or supervisory authority may determine
that we have not done so and subject us to fines, potentially costly remediation requirements, and public
censure, which could harm our business. For example, the European Union’s General Data Protection
Regulation (GDPR) mandates requirements for processing personal information and imposes penalties of
up to the greater of €20 million or 4% of worldwide revenue for non-compliance. In addition, in the United
States, we may be subject to both federal and state laws. Certain U.S. state laws may be more stringent
or broader in scope, or offer greater individual rights, with respect to the protection of personal information
than federal, international, or other state laws, and such laws may differ from each other, all of which may
complicate compliance efforts. For example, California continues to be a critical state with respect to
evolving consumer privacy laws after enacting the California Consumer Privacy Act (CCPA), amended by
the California Privacy Rights Act (the CPRA), which took effect in January 2023 and expanded the
CCPA’s requirements, including by adding a new right for individuals to correct their personal information
and establishing a new regulatory agency to implement and enforce the law. Failure to comply with the
CCPA and the CPRA may result in significant civil penalties, injunctive relief, or statutory or actual
damages as determined by the California Privacy Protection Agency and California Attorney General
through its investigative authority.
We also are bound by standards, contracts and other obligations relating to processing personal
information that may be more stringent than applicable laws and regulations. The costs of compliance
with, and other burdens imposed by, these laws, regulations, and other obligations are significant. In
addition, some companies, particularly larger or global enterprises, often will not contract with vendors
that do not meet these rigorous obligations and often seek contract terms to ensure we are financially
liable for any breach of these obligations. Accordingly, our or our vendors’ failure, or perceived inability, to
comply with these obligations may limit the demand, use and adoption of our solutions, lead to regulatory
investigations, breach of contract claims, litigation, damage our reputation and brand and lead to
significant fines, penalties, or liabilities or slow the pace at which we close sales transactions, any of
which could harm our business. In addition, there is no assurance that our privacy and security-related
safeguards, including measures we may take to mitigate the risks of using third parties, will protect us
from the risks associated with the third-party processing, storage, and transmission of such information.
Privacy advocacy groups, the technology industry, and other industries have established or may
establish various new, additional, or different self-regulatory standards that may place additional burdens
on us. Our customers may require us or we may find it advisable to meet voluntary certifications or
adhere to other standards established by them or third parties. Our customers may also expect us to take
proactive stances or contractually require us to take certain actions should a request for personal
information belonging to customers be received from a government or regulatory agency. If we are unable
to maintain such certifications, comply with such standards, or meet such customer requests, it could
reduce demand for our solutions and adversely affect our business.
Future laws, regulations, standards, and other obligations, actions by governments or other agencies,
and changes in the interpretation or inconsistent interpretation of existing laws, regulations, standards,
and other obligations could result in increased regulation, increased costs of compliance and penalties for
non-compliance, costly changes to Zuora’s products or their functionality, and limitations on processing
personal information. Any failure or perceived failure by us (or the third parties with whom we have
contracted to process such information) to comply with applicable privacy and security laws, policies or
related contractual obligations, or any compromise of security that results in unauthorized access, use, or
transmission of, personal information, could result in a variety of claims against us, including litigation,
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governmental enforcement actions, investigations, and proceedings by data protection authorities, as well
as fines, sanctions, loss of export privileges, damage to our reputation, or loss of customer confidence,
any of which may have a material adverse effect on our business, operating results, and financial
condition.
Inability or failure to protect our intellectual property could adversely affect our business.
Our success depends in large part on our proprietary technology. We rely on various intellectual
property rights, including patents, copyrights, trademarks, and trade secrets, as well as confidentiality
provisions and contractual arrangements, to protect our proprietary rights. If we do not protect and
enforce our intellectual property rights successfully, our competitive position could be affected, which in
turn could adversely impact our business and operating results.
Our pending patent or trademark applications may not be allowed, or competitors may challenge the
validity, enforceability or scope of our patents, copyrights, trademarks or the trade secret status of our
proprietary information. There can be no assurance that additional patents will be issued or that any
patents that are issued will provide significant protection for our business, including our technology,
innovations and similar assets. There is also no assurance that we will be able to register trademarks that
are critical to our business. In addition, our patents, copyrights, trademarks, trade secrets, and other
intellectual property rights may not provide us a significant competitive advantage. There is no assurance
that the particular forms of intellectual property protection that we seek, including business decisions
about when to file patents and when to maintain trade secrets, will be adequate to protect our business.
Moreover, U.S. patent law, developing jurisprudence regarding U.S. patent law, and possible future
changes to U.S. or foreign patent laws and regulations may affect our ability to protect and enforce our
intellectual property rights. In addition, the laws of some countries do not provide the same level of
protection of our intellectual property as do the laws of the United States. As we expand our international
activities, our exposure to unauthorized copying and use of our solutions and proprietary information will
likely increase. Despite our precautions, our intellectual property is vulnerable to unauthorized access
through employee error or actions, theft, and cybersecurity incidents, and other security breaches. It may
be possible for third parties to infringe upon or misappropriate our intellectual property, to copy our
solutions, and to use information that we regard as proprietary to create products and services that
compete with ours, all of which could result in costly litigation. Effective intellectual property protection
may not be available to us in every country in which our solutions are available, and where such
protection is available, may be costly. For example, some foreign countries have compulsory licensing
laws under which a patent owner must grant licenses to third parties. In addition, many countries limit the
enforceability of patents against certain third parties, including government agencies or government
contractors. In these countries, patents may provide limited or no benefit. We may need to expend
additional resources to defend our intellectual property rights domestically or internationally, which could
impair our business or adversely affect our domestic or international expansion. Moreover, we may not
pursue or file patent applications or apply for registration of copyrights or trademarks in the United States
and foreign jurisdictions in which we operate with respect to our potentially patentable inventions, works
of authorship, marks and logos for a variety of reasons, including the cost of procuring such rights and the
uncertainty involved in obtaining adequate protection from such applications and registrations. If we
cannot adequately protect and defend our intellectual property, we may not remain competitive, and our
business, operating results, and financial condition may be adversely affected.
We enter into confidentiality and invention assignment agreements with our employees and
consultants and enter into confidentiality agreements with other parties. We cannot assure you that these
agreements will be effective in controlling access to, use of, and distribution of our proprietary information
or in effectively securing exclusive ownership of intellectual property developed by our current or former
employees and consultants. Further, these agreements may not prevent other parties from reverse
engineering or independently developing technologies that are substantially equivalent or superior to our
solutions.
We may need to spend significant resources securing and monitoring our intellectual property rights,
and we may or may not be able to detect infringement by third parties. Our competitive position may be
harmed if we cannot detect infringement and enforce our intellectual property rights quickly or at all. In
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some circumstances, we may choose to not pursue enforcement because an infringer has a dominant
intellectual property position or for other business reasons. In addition, competitors might avoid
infringement by designing around our intellectual property rights or by developing non-infringing
competing technologies. Litigation may be necessary in the future to enforce our intellectual property
rights and to protect our trade secrets. Litigation brought to protect and enforce our intellectual property
rights could be costly, time-consuming, and distracting to management, and could result in the impairment
or loss of portions of our intellectual property. Further, our efforts to enforce our intellectual property rights
may be met with defenses, counterclaims attacking the scope, validity, and enforceability of our
intellectual property rights, or with counterclaims and countersuits asserting infringement by our products
and services of third-party intellectual property rights. Our failure to secure, protect, and enforce our
intellectual property rights could have a material adverse effect on our brand and our business.
Additionally, the United States Patent and Trademark Office and various foreign governmental patent
agencies require compliance with a number of procedural, documentary, fee payment, and other similar
provisions in order to complete the patent or trademark application process and to maintain issued
patents or trademarks, which can be costly. There are situations in which noncompliance or non-payment
can result in abandonment or lapse of the patent or trademark or associated application, resulting in
partial or complete loss of patent or trademark rights in the relevant jurisdiction. If this occurs, it could
have a material adverse effect on our business operations and financial condition.
Errors, defects, or disruptions in our solutions could diminish demand, harm our financial
results, and subject us to liability.
Our customers use our products for important aspects of their businesses, and any errors, defects, or
disruptions to our solutions, or other performance problems with our solutions, could harm our reputation
and may damage our customers’ businesses. We are also reliant on third-party software and
infrastructure, including the infrastructure of the Internet, to provide our products and services. Any failure
of or disruption to this software and infrastructure, which could be caused by a variety of factors, including
infrastructure changes, power or network outages, fire, flood or other natural disasters, human or software
errors, viruses, security breaches, fraud or other malicious activity, could also make our solutions
unavailable to our customers. Our solutions are constantly changing with new software releases, which
may contain undetected errors when first introduced or released. Any errors, defects, disruptions in
service, or other performance problems with our solutions could result in negative publicity, loss of or
delay in market acceptance of our products, loss of competitive position, delay of payment to us, lower
renewal rates, or claims by customers for losses sustained by them. In such an event, we may be
required, or may choose even when not required, for customer relations or other reasons, to expend
additional resources in order to help correct the problem. Accordingly, any errors, defects, downtime, or
disruptions and other performative quality problems, or any perception of the aforementioned problems, to
our solutions could adversely impact our brand and reputation, revenue, and operating results. In
addition, we may not carry insurance sufficient to offset any losses that may result from claims arising
from errors, defects or other disruptions in our products.
Any disruption of service at our cloud providers, including AWS and Microsoft’s Azure cloud
service, could interrupt or delay our ability to deliver our services to our customers, which could
harm our business and our financial results.
We currently host our solutions, serve our customers, and support our operations using AWS, a
provider of cloud infrastructure services, and have begun enabling new features and capabilities for our
solutions using Microsoft’s Azure cloud service. We also leverage AWS in various geographic regions for
our disaster recovery plans. We do not have control over the operations of the facilities of AWS or Azure.
These facilities are vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, cyber
security attacks, terrorist attacks, power losses, telecommunications failures, and similar events, including
events due to the effects of climate change. The occurrence of a natural disaster or an act of terrorism, a
decision to close the facilities without adequate notice, or other unanticipated problems could result in
lengthy interruptions in our solutions. In addition, breaks in the supply chain due to transportation issues
or other factors could potentially disrupt the delivery of hardware needed to maintain these third-party
systems or to run our business. The facilities also could be subject to break-ins, computer viruses,
sabotage, intentional acts of vandalism, and other misconduct.
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The continuing and uninterrupted performance of our solutions are critical to our success. Because
our products and services are used by our customers for billing and financial accounting purposes, it is
critical that our solutions be accessible without interruption or degradation of performance, and we
typically provide our customers with service level commitments with respect to service uptime. Customers
may become dissatisfied by any system failure that interrupts our ability to provide our solutions to them.
Outages could lead to the triggering of our service level agreements and the issuance of credits to our
customers, in which case, we may not be fully indemnified for such losses by AWS or Azure. We may not
be able to easily switch our public cloud providers, including AWS and Azure, to another cloud provider if
there are disruptions or interference with our use of either facility. Sustained or repeated system failures
would reduce the attractiveness of our solutions to customers and result in contract terminations, thereby
reducing revenue. Moreover, negative publicity arising from these types of disruptions could damage our
reputation and may adversely impact use of our solutions. We may not carry sufficient business
interruption insurance to compensate us for losses that may occur as a result of any events that cause
interruptions in our service.
Our agreement with AWS expires in September 2024. AWS and our other cloud providers do not
have an obligation to renew their agreements with us on commercially reasonable terms, or at all. If we
are unable to renew our agreements with these providers on commercially reasonable terms, if our
agreements with our providers are prematurely terminated, or if in the future we add additional public
cloud providers, we may experience additional costs or service downtime in connection with the transfer
to, or the addition of, new public cloud providers. If these providers were to increase the cost of their
services, we may have to increase the price of our solutions, and our operating results may be adversely
impacted.
Our solutions contain open source software components, and failure to comply with the
terms of the underlying licenses could restrict our ability to sell our solutions.
Our solutions incorporate certain open source software. An open source license typically permits the
use, modification, and distribution of software in source code form subject to certain conditions. Some
open source licenses contain conditions that any person who distributes or uses a modification or
derivative work of software that was subject to an open source license make the modified version subject
to the same open source license. Distributing or using software that is subject to this kind of open source
license can lead to a requirement that certain aspects of our solutions be distributed or made available in
source code form. Although we do not believe that we have used open source software in a manner that
might condition its use on our distribution of any portion of our proprietary and confidential solutions in
source code form, the interpretation of open source licenses is legally complex and, despite our efforts, it
is possible that we could face assertions of copyright infringement, breach of contract, or other claims if
our use of open source software fails to comply with the applicable open source licenses.
Moreover, we cannot guarantee that our processes for controlling our use of open source software in
our solutions will be effective. To continue offering our solutions, we may need to seek licenses from third
parties on terms that are not economically feasible, re-engineer our solutions to remove or replace certain
open source software, discontinue the sale of our solutions if re-engineering cannot be accomplished on a
timely basis, pay monetary damages, or make available corresponding source code for aspects of our
proprietary and confidential technology, any of which could adversely affect our business, operating
results, and financial condition.
In addition to risks related to license requirements, use of open source software generally comes
without warranties, assurances of title, performance, non-infringement, or controls on the origin of the
software. There is typically no support available for open source software, and we cannot assure you that
the authors of such open source software will not abandon further development and maintenance. Open
source software may contain security vulnerabilities, and we may be subject to additional security risk by
using open source software. Many of the risks associated with the use of open source software, such as
the lack of warranties or assurances of title or performance, cannot be eliminated, and could, if not
properly addressed, adversely affect our business. We have established processes to help alleviate these
risks, including a review process for screening requests from our development organizations for the use
of open source software, but we cannot be sure that all open source software is identified or submitted for
approval prior to use in our solutions.
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Our increased focus on the development and use of various types of AI in our platform and
our business, as well as our potential failure to effectively implement, use, and market AI, may
result in reputational harm or liability, or could otherwise adversely affect our business.
We have incorporated and may continue to incorporate AI solutions and features into our platform,
and otherwise within our business, and these solutions and features may become more important to our
operations or to our future growth over time. There can be no assurance that we will realize any of the
desired or anticipated benefits from AI, and we may fail to properly implement or market our AI solutions
and features. Additionally, our competitors may incorporate AI into their products, offerings, and solutions
more quickly or more successfully than we do, or they may have access to more complete or adequate
data than our use of AI relies on, which could impair our ability to compete effectively, and adversely affect
our results or operations. Our AI solutions and features may also expose us to additional claims,
demands, and proceedings by private parties and regulatory authorities and subject us to legal liability or
brand and reputational harm, and could also require us to spend time, expenses, and other resources on
making necessary changes to our AI practices, as the legal, regulatory, and policy environments around
AI are evolving rapidly and the availability of legal protections for intellectual property generated by AI is
uncertain.
Risks Related to Legal, Regulatory, Accounting, and Tax Matters
Adverse litigation judgments or settlements could expose us to significant monetary
damages or limit our ability to operate our business.
From time to time, we face litigation or claims arising in or outside the ordinary course of business,
which may include class actions, derivative actions, private actions, collective actions, investigations, and
various other legal proceedings by stockholders, customers, employees, suppliers, competitors,
government agencies, or others. The results of any such litigation, investigations, and other legal
proceedings are inherently unpredictable and expensive. Any claims against us, whether meritorious or
not, could be time consuming, result in costly litigation, damage our reputation, require significant
amounts of management time, and divert significant resources. If legal proceedings were to be
determined adversely to us, or we were to enter into a settlement arrangement, we could be exposed to
significant monetary damages or limits on our ability to operate our business, which could have a material
adverse effect on our business, financial condition, and operating results. For example, in connection with
the settlement of certain shareholder litigation, in the quarter ended October 31, 2023, we made a
payment of $68.3 million (net of insurance proceeds). For more information on the shareholder litigation,
see Note 13. Commitments and Contingencies of the Notes to Consolidated Financial Statements.
We are vulnerable to lawsuits brought against us by others alleging infringement or
proprietary rights or for other intellectual property related claims.
There has been considerable activity in our industry to develop and enforce patents, copyrights,
trademarks, trade secrets and other intellectual property and proprietary rights, resulting in frequent
litigation based on allegations of infringement or other violations of such rights. Moreover, in recent years,
individuals and groups have acquired patents or other intellectual property assets without practicing the
inventions solely to attempt to enforce them against others and ultimately extract monetary settlements.
Successful intellectual property infringement claims against us or certain third parties, such as our
customers, resellers, or strategic partners, whether by operating entities, non-practicing entities or patent
assertion entities, could result in monetary liability or a material disruption in the conduct of our business.
We cannot be certain that our products and services, content, and brand names do not or will not infringe
valid patents, trademarks, copyrights, or other intellectual property rights held by third parties. We may be
subject to legal proceedings and claims from time to time relating to the intellectual property of others in
the ordinary course of our business. Any intellectual property litigation to which we might become a party,
or for which we are required to provide indemnification, may require us to cease selling or using solutions
that incorporate the intellectual property that we allegedly infringe and obtaining a license may not be
available on reasonable terms or at all, thereby hindering our ability to sell or use the relevant technology,
or requiring redesign of the allegedly infringing solutions to avoid infringement, which could be costly,
time-consuming, or impossible. It may also cause us to make substantial payments for legal fees,
settlement payments, licensing costs, or other costs or damages. Any claims or litigation, regardless of
35

merit, could cause us to incur significant expenses and, if successfully asserted against us, could require
that we pay substantial damages or ongoing royalty payments, prevent us from offering our products and
services, or require that we comply with other unfavorable terms. We do not have a significant patent
portfolio, which could prevent us from deterring patent infringement claims through our own patent
portfolio, and our competitors and others may now and in the future have significantly larger and more
mature patent portfolios than we have. We may also be obligated to indemnify our customers or strategic
partners in connection with such infringement claims, or to obtain licenses from third parties or modify our
solutions, and each such obligation could further exhaust our resources. Some of our intellectual property
infringement indemnification obligations are contractually capped at a very high amount or not capped at
all.
Even if the claims do not result in litigation or are resolved in our favor, these claims, and the time
and resources necessary to resolve them, could divert the time and attention of our management and
other employees, and adversely affect our business and operating results, including by preventing us
from offering our services. We expect that the occurrence of infringement claims is likely to grow as the
market for monetization products and services grows. Accordingly, our exposure to damages resulting
from infringement claims could increase and this could further exhaust our financial and management
resources.
If we are not able to satisfy data protection, security, privacy, and other government- and
industry-specific requirements, our growth could be harmed.
We are subject to data protection, security, privacy, and other government- and industry-specific
requirements, including those that require us to notify individuals of data security and privacy incidents
involving certain types of personal information. Security and privacy compromises experienced by us or
our service providers may lead to public disclosures, which could harm our reputation, erode customer
confidence in the effectiveness of our security and privacy measures, adversely impact our ability to
attract new customers, cause existing customers to elect not to renew their subscriptions with us, or
adversely impact our employee relationships or impair our ability to attract new employees. In addition,
some of the industries we serve have industry-specific requirements relating to compliance with certain
security, privacy and regulatory standards, such as those required by the Health Insurance Portability and
Accountability Act. We also maintain compliance with the Payment Card Industry Data Security Standard,
which is critical to the financial services and insurance industries. As we expand and sell into new
verticals and regions, we will likely need to comply with these and other requirements to compete
effectively. If we cannot comply or if we incur a violation in one or more of these requirements, our growth
could be adversely impacted, and we could incur significant liability.
Because we typically recognize subscription revenue over the term of the applicable
agreement, a lack of subscription renewals or new subscription agreements may not be reflected
immediately in our operating results and may be difficult to discern.
We generally recognize subscription revenue from customers ratably over the terms of their
contracts, which typically vary between one and five years. As a result, most of the subscription revenue
we report in each quarter is derived from the recognition of unearned revenue relating to subscriptions
entered during previous quarters. Consequently, a decline in new or renewed subscriptions in any
particular quarter would likely have a minor impact on our revenue results for that quarter, but could
adversely affect our revenue in future quarters. Accordingly, the effect of significant downturns in sales
and market acceptance of our solutions, and potential changes in our pricing policies or rate of renewals,
may not be fully reflected in our operating results until future periods. Moreover, our recurring revenue
model makes it difficult for us to rapidly increase our revenue through additional sales in any period, as
revenue from new customers must be recognized over the applicable subscription term.
We typically provide service level commitments under our customer contracts. If we fail to
meet these contractual commitments, we could be obligated to provide credits or refunds for
prepaid amounts related to unused subscription services or face contract terminations, which
could adversely affect our operating results.
Our customer contracts typically provide for service level commitments, which relate to service
uptime, response times, and escalation procedures. If we are unable to meet the stated service level
commitments or suffer extended periods of unavailability for our solutions, we may be contractually
36

obligated to provide these customers with service credits, refunds for prepaid amounts related to unused
subscription services, or other remedies, or we could face contract terminations. In addition, we could
face legal claims for breach of contract, product liability, tort, or breach of warranty. Although we have
contractual protections, such as warranty disclaimers and limitation of liability provisions, in our customer
agreements, they may not fully or effectively protect us from claims by customers, commercial
relationships, or other third parties. We may not be fully indemnified by our vendors for service
interruptions beyond our control, and any insurance coverage we may have may not adequately cover all
claims asserted against us, or may cover only a portion of such claims. In addition, even claims that
ultimately are unsuccessful could result in our expenditure of funds in litigation and divert management’s
time and other resources. Thus, our revenue could be harmed if we fail to meet our service level
commitments under our agreements with our customers, including, but not limited to, maintenance
response times and service outages. Typically, we have not been required to provide customers with
service credits that have been material to our operating results, but we cannot assure you that we will not
incur material costs associated with providing service credits to our customers in the future. Additionally,
any failure to meet our service level commitments could adversely impact our reputation, business,
operating results, and financial condition.
Our customers may fail to pay us in accordance with the terms of their agreements,
necessitating action by us to compel payment.
We typically enter into non-cancelable agreements with our customers with a term of one to five
years. If customers fail to pay us under the terms of our agreements, we may be adversely affected both
from the inability to collect amounts due and the cost of enforcing the terms of our contracts, including
litigation. The risk of such adverse effects increases with the term length of our customer arrangements.
Furthermore, some of our customers may seek bankruptcy protection or other similar relief and fail to pay
amounts due to us, or pay those amounts more slowly, either of which could adversely affect our
operating results, financial position, and cash flow. Although we have processes in place that are
designed to monitor and mitigate these risks, we cannot guarantee these programs will be effective. If we
are unable to adequately control these risks, our business, operating results and financial condition could
be harmed.
Our ability to use our net operating losses to offset future taxable income may be subject to
certain limitations which could subject our business to increased tax liability.
Our ability to use our net operating losses (NOLs) to offset future taxable income may be subject to
certain limitations which could subject our business to higher tax liability. Utilization of the net operating
loss may be subject to an annual limitation due to the ‘‘ownership change’’ limitations provided by
Section 382 and 383 of the Internal Revenue Code of 1986, as amended, and other similar state
provisions. Additionally, NOLs arising in tax years beginning before December 31, 2017 are subject to a
20-year carryover limitation and may expire if unused within that period. There is also a risk that due to
legislative changes, such as suspensions on the use of NOLs, or other unforeseen reasons, our existing
NOLs could expire or otherwise be unavailable to offset future income tax liabilities. In addition, under the
Tax Cuts and Jobs Act of 2017, as modified by the Coronavirus Aid, Relief, and Economic Security Act,
the amount of NOLs that we are permitted to deduct in any taxable year is limited to 80% of our taxable
income in such year, where taxable income is determined without regard to the NOL deduction itself. As
such, we may not be able to realize a tax benefit from the use of our NOLs, whether or not we attain
profitability.
We may need to raise additional capital required to grow our business, and we may not be
able to raise capital on terms acceptable to us or at all.
In order to support our growth and respond to business challenges, such as developing new features
or enhancements to our solutions to stay competitive, acquiring new technologies, and improving our
infrastructure, we have made significant financial investments in our business, and we intend to continue
to make such investments. As a result, to provide the funds required for these investments and other
business endeavors, we may need to engage in equity or debt financings. For example, we have issued
$400.0 million in 2029 Notes. See Note 9. Debt of the Notes to Consolidated Financial Statements for
more information about the 2029 Notes.
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If we raise additional funds through equity or convertible debt issuances, our existing stockholders
may suffer significant dilution, and these securities could have rights, preferences, and privileges that are
superior to that of holders of our common stock. If we obtain additional funds through debt financing, we
may not be able to obtain such financing on terms favorable to us. Such terms may involve additional
restrictive covenants making it difficult to engage in capital raising activities and pursue business
opportunities, including potential acquisitions. Our 2029 Notes, for example, restrict our ability to incur
additional indebtedness, including secured indebtedness. Our credit facility also contains restrictive and
financial covenants and is secured by substantially all of our non-intellectual property assets.
In addition, servicing the interest and principal repayment obligations under our current or future
indebtedness could divert funds that would otherwise be available to fund working capital, capital
expenditures, acquisitions, and other business activities.
Future volatility in the trading price of our common stock may reduce our ability to access equity
capital on favorable terms or at all. Our ability to make payments on our indebtedness, refinance
indebtedness or incur additional indebtedness to fund or expand our business will depend on our financial
condition and market conditions. A recession, depression or other sustained adverse market event
resulting from deteriorating macroeconomic factors could materially and adversely affect our business
and the value of our common stock and our access to capital. If we are unable to generate sufficient cash
flows or obtain adequate financing or financing on terms satisfactory to us, or at all, when we require it,
our ability to continue to support our business growth and to respond to business challenges could be
significantly impaired and our business may be adversely affected, requiring us to delay, reduce, or
eliminate development of new services or future marketing efforts, or reduce or discontinue some or all of
our operations. Any of these events could significantly harm our business, financial condition, and
prospects.
Failure to comply with anti-corruption and anti-money laundering laws, including the FCPA
and similar laws associated with our activities outside of the United States, could subject us to
penalties and other adverse consequences.
We are subject to the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S.
Travel Act, the USA PATRIOT Act, the UK Bribery Act, and possibly other anti-bribery and anti-money
laundering laws in countries in which we conduct activities. We face significant risks if we fail to comply
with the FCPA and other anti-corruption laws that prohibit companies and their employees and third-party
intermediaries from promising, authorizing, offering, or providing, directly or indirectly, improper payments
or benefits to foreign government officials, political parties, and private-sector recipients for the purpose of
obtaining or retaining business, directing business to any person, or securing any advantage. In many
foreign countries, particularly in countries with developing economies, it may be a local custom that
businesses engage in practices that are prohibited by the FCPA or other applicable laws and regulations.
In addition, we use various third parties to sell our solutions and conduct our business abroad. We or our
third-party intermediaries may have direct or indirect interactions with officials and employees of
government agencies or state-owned or affiliated entities and we can be held liable for the corrupt or
other illegal activities of these third-party intermediaries, our employees, representatives, contractors,
partners, and agents, even if we do not explicitly authorize such activities. We have implemented an
anti-corruption compliance program but cannot assure you that all of our employees and agents, as well
as those companies to which we outsource certain of our business operations, will not take actions in
violation of our policies and applicable law, for which we may be ultimately held responsible.
Any violation of the FCPA, other applicable anti-corruption laws, and anti-money laundering laws
could result in whistleblower complaints, adverse media coverage, investigations, loss of export
privileges, or severe criminal or civil sanctions, which could have a material adverse effect on our
reputation, business, operating results, and prospects. In addition, responding to any enforcement action
may result in a significant diversion of management’s attention and resources, significant defense costs,
and other professional fees.
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We are required to comply with governmental export control laws and regulations. Our failure
to comply with these laws and regulations could have an adverse effect on our business and
operating results.
Our solutions are subject to governmental, including United States and European Union, export
control laws and import regulations, and as a U.S. company we are covered by the U.S. sanctions
regulations. Export control and economic sanctions laws and regulations restrict or prohibit the shipment
of certain products and services to embargoed or sanctioned countries, governments, entities and
persons, and complying with export control and sanctions regulations for a particular sale may be
time-consuming and may result in the delay or loss of sales opportunities. While we take precautions to
prevent our solutions from being exported in violation of these laws or engaging in any other activities that
are subject to these regulations, if we were to fail to comply with U.S. export laws, U.S. Customs
regulations and import regulations, U.S. economic sanctions, and other countries’ import and export laws,
we could be subject to substantial civil and criminal penalties, including fines for our company,
enforcement actions, incarceration for responsible officers and employees, reputational harm, and/or the
possible loss of export or import privileges which could impact our ability to provide our solutions to
customers. We could also be held liable for our third-party affiliates’ non-compliance with sanctions and
export controls.
We incorporate encryption technology in our products, and certain encryption products may be
exported outside of the United States only by a license or a license exception. In addition, various
countries regulate the import of certain encryption technology, including import permit and/or license
requirements, and some have enacted laws that could limit our ability to distribute our products or could
limit our customers’ ability to deploy our products in those countries. Although we take precautions to
prevent our products from being provided in violation of such laws, we cannot assure you that inadvertent
violations of such laws have not occurred or will not occur in connection with the distribution or use of our
products despite the precautions we take. Governmental regulation of encryption technology and
regulation of imports or exports, or our failure to obtain required import or export approval for our
products, could harm our international sales and adversely affect our operating results.
Further, if our partners, including suppliers, fail to obtain required import, export, or re-export licenses
or permits, we may also be impacted by becoming the subject of government investigations or penalties
and therefore incur reputational harm. Changes in our solutions or changes in sanctions or export and
import regulations may create delays in the introduction of our solutions in international markets, prevent
our customers with international operations from deploying our solutions globally or, in some cases,
prevent the export or import of our solutions to certain countries, governments, or persons altogether. Any
change in export or import laws or regulations, economic sanctions, or related legislation, shift in the
enforcement or scope of existing laws and regulations, or change in the countries, governments, persons,
or technologies targeted by such laws and regulations, could result in decreased use of our solutions by,
or in our decreased ability to export or sell our solutions to, existing or potential customers such as
customers with international operations or customers who are added to the restricted entities list
published by the U.S. Office of Foreign Assets Control (OFAC). Any decreased use of our solutions or
limitation on our ability to export or sell our solutions would likely harm our business, financial condition,
and operating results.
The applicability of sales, use and other tax laws or regulations in the U.S. and internationally
on our business is uncertain. Adverse tax laws or regulations could be enacted or existing laws
could be applied to us or our customers, which could subject us to additional tax liability and
related interest and penalties, increase the costs of our services and adversely impact our
business.
The application of federal, state, local, and non-U.S. tax laws to services provided electronically is
evolving. New income, sales, use, value-added, or other direct or indirect tax laws, statutes, rules,
regulations, or ordinances could be enacted at any time (possibly with retroactive effect), and could be
applied solely or disproportionately to services provided over the Internet or could otherwise materially
affect our financial position and operating results. Many countries in the European Union, as well as a
number of other countries and organizations such as the Organization for Economic Cooperation and
Development, have proposed or recommended changes to existing tax laws or have enacted new laws
that could impact our tax obligations. As we expand the scale of our international business activities, any
39

changes in the U.S. or foreign taxation of such activities may increase our worldwide effective tax rate
and harm our business, operating results, and financial condition.
In addition, state, local, and foreign tax jurisdictions have differing rules and regulations governing
sales, use, value-added, and other taxes, and these rules and regulations can be complex and are
subject to varying interpretations that may change over time. Existing tax laws, statutes, rules,
regulations, or ordinances could be interpreted, changed, modified, or applied adversely to us (possibly
with retroactive effect), which could require us or our customers to pay additional tax amounts on prior
sales and going forward, as well as require us or our customers to pay fines or penalties and interest for
past amounts. Although our customer contracts typically provide that our customers must pay all
applicable sales and similar taxes, our customers may be reluctant to pay back taxes and associated
interest or penalties, or we may determine that it would not be commercially feasible to seek
reimbursement. If we are required to collect and pay back taxes and associated interest and penalties, or
we are unsuccessful in collecting such amounts from our customers, we could incur potentially substantial
unplanned expenses, thereby adversely impacting our operating results and cash flows. Imposition of
such taxes on our services going forward could also adversely affect our sales activity and have an
adverse impact on our operating results and cash flows.
Our reported financial results may be adversely affected by changes in accounting principles
generally accepted in the United States.
Generally Accepted Accounting Principles (GAAP) is subject to interpretation by the Financial
Accounting Standards Board (FASB), the SEC, and various bodies formed to promulgate and interpret
appropriate accounting principles. A change in these principles or interpretations could have a significant
effect on our reported financial results, and could affect the reporting of transactions completed before the
announcement of a change. Any difficulties in implementing these pronouncements, including those
described in Note 2. Summary of Significant Accounting Policies and Recent Accounting Pronouncements
of the Notes to Consolidated Financial Statements, could cause us to fail to meet our financial reporting
obligations, which could result in regulatory discipline and harm investors’ confidence in us.
Risks Related to Ownership of Our Class A Common Stock
The stock price of our Class A common stock has been and may continue to be volatile, and
you could lose all or part of your investment.
The market price of our Class A common stock since our initial public offering in 2018 has been and
may continue to be volatile. In addition to factors discussed in this Form 10-K, the market price of our
Class A common stock may fluctuate significantly in response to numerous factors, many of which are
beyond our control, including:
•
overall performance of the equity markets;
•
actual or anticipated fluctuations in our key metrics, revenue and other operating results;
•
changes in the financial projections or outlook for key metrics we may provide to the public or
our failure to achieve these projections or metrics;
•
failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates
by any securities analysts who follow our company, or our failure to meet these estimates or the
expectations of investors;
•
recruitment or departure of key personnel;
•
the economy as a whole and market conditions in our industry;
•
negative publicity related to the real or perceived quality of our solutions, as well as the failure to
timely launch new products and services that gain market acceptance;
•
growth of the market for our products;
•
rumors and market speculation involving us or other companies in our industry;
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•
announcements by us or our competitors of new products, commercial relationships, or
significant technical innovations;
•
acquisitions, strategic partnerships, joint ventures, or capital commitments;
•
issuance of shares of our common stock, including shares issued by us in an acquisition or upon
conversion or exercise of some or all of our outstanding 2029 Notes and Warrants;
•
new laws or regulations or new interpretations of existing laws or regulations applicable to our
business;
•
lawsuits threatened or filed against us, litigation involving our industry, or both;
•
developments or disputes concerning our or other parties’ products, services, or intellectual
property rights;
•
changes in accounting standards, policies, guidelines, interpretations, or principles;
•
actions instituted by activist shareholders or others;
•
actual or perceived privacy, security, data protection, or cybersecurity incidents;
•
other events or factors, including those resulting from geopolitical developments such as war,
incidents of terrorism, or responses to these events, including the ongoing conflicts in Ukraine
and Israel and changes in China-Taiwan and U.S.-China relations;
•
the impact of catastrophic events such as natural disasters or pandemics on the global
macroeconomy, our operating results and enterprise technology spending;
•
sales of shares of our Class A common stock by us or our stockholders;
•
inflation;
•
fluctuations in interest rates; and
•
disruptions to the U.S. or international banking system.
In addition, the stock markets have experienced extreme price and volume fluctuations that have
affected and continue to affect the market prices of equity securities of many companies. Stock prices of
many companies, and technology companies in particular, have fluctuated in a manner unrelated or
disproportionate to the operating performance of those companies. Some companies that have
experienced volatility in the market price of their securities have been subject to shareholder litigation. We
have been subject to shareholder litigation, which is described in Note 13. Commitments and
Contingencies of the Notes to Consolidated Financial Statements. Future shareholder litigation could
subject us to substantial costs, divert resources and the attention of management from our business, and
adversely affect our business.
The market price of our Class A common stock could decline as a result of a substantial
number of shares of our Class A common stock being issued or sold, which may make it more
difficult for you to sell your Class A common stock at a time and price that you deem appropriate.
As of February 29, 2024, a total of 137.8 million shares of Class A common stock and 8.2 million
shares of Class B common stock were outstanding. The issuance and sale of a substantial number of
shares of our Class A common stock, including as a result of the exercise or conversion into Class A
common stock of outstanding convertible notes, warrants, equity awards, shares of Class B common
stock or other securities, could result in significant dilution to our existing stockholders and cause the
market price of our Class A common stock to decline. The perception that such issuances could occur
could also adversely affect the market price of our Class A common stock. From time to time, we may
also issue shares of common stock or securities convertible into shares of common stock in connection
with a financing, an acquisition, investments, or otherwise. For example, as described in Note 9. Debt of
the Notes to Consolidated Financial Statements, we issued to Silver Lake 2029 Notes in the aggregate
principal amount of $400.0 million, including $150.0 million that were issued during the fiscal year ended
January 31, 2024, as well as Warrants initially exercisable for up to 7.5 million shares of Class A common
stock. In addition, under certain circumstances, the number of shares issuable upon conversion of the
41

2029 Notes or exercise of the Warrants may be subject to increase, as described in Note 9. Debt and
Note 17. Warrants to Purchase Shares of Common Stock of the Notes to Consolidated Financial
Statements. The conversion of these convertible notes or exercise of these Warrants could result in a
substantial number of shares of our Class A common stock being issued.
In addition, we grant equity awards to employees, directors, and consultants under our 2018 Equity
Incentive Plan on an ongoing basis and our employees have the right to purchase shares of our Class A
common stock semi-annually under our 2018 Employee Stock Purchase Plan. As of January 31, 2024,
there were a total of 20.1 million shares of Class A common stock subject to outstanding options and
restricted stock units (RSUs), including performance stock units (PSUs). Subject to vesting and other
applicable requirements, the shares issued upon the exercise of such options or settlement of such RSUs
will be available for resale in the open market. Moreover, the market price of our Class A common stock
could decline as a result of sales of a large number of shares of our Class A common stock in the market
over a short period of time, such as sales by our directors, executive officers, or significant stockholders,
sales by Zuora for employee tax withholding purposes upon vesting of RSUs or PSUs, and sales by
employees during limited open trading windows.
We also have granted and may grant from time to time certain registration rights that, subject to
certain conditions, require us to file registration statements for the public resale of certain securities or to
include such securities in registration statements that we may file on behalf of our company or other
stockholders.
If securities or industry analysts do not publish research, or publish inaccurate or
unfavorable research, about our business, the price of our Class A common stock and trading
volume could decline.
The trading market for our Class A common stock depends in part on the research and reports that
securities or industry analysts publish about us or our business. If few securities analysts commence
coverage of us, or if industry analysts cease coverage of us, the trading price for our Class A common
stock could be adversely affected. If one or more of the analysts who cover us downgrade our Class A
common stock or publish inaccurate or unfavorable research about our business, the price of our Class A
common stock would likely decline. If one or more of these analysts cease coverage of us or fail to
publish reports on us regularly, demand for our Class A common stock could decrease, which might
cause our Class A common stock price and trading volume to decline.
Even if our stock is actively covered by analysts, we do not have any control over the analysts or the
measures that analysts or investors may rely upon to forecast our future results. For example, in order to
assess our business activity in a given period, analysts and investors may look at the combination of
revenue and changes in deferred revenue in a given period (sometimes referred to as ‘‘billings’’).
Over-reliance on billings or similar measures may result in analyst or investor forecasts that differ
significantly from our own for a variety of reasons, including:
•
a relatively large number of transactions occur at the end of the quarter. Invoicing of those
transactions may or may not occur before the end of the quarter based on a number of factors
including receipt of information from the customer, volume of transactions, and holidays. A shift
of a few days has little economic impact on our business, but will shift deferred revenue from one
period into the next;
•
a shift in billing frequency (i.e., from monthly to quarterly or from quarterly to annually), which
may distort trends;
•
subscriptions that have deferred start dates; and
•
services that are invoiced upon delivery.
In addition, the revenue recognition disclosure obligations under Accounting Standards Update (ASU)
No. 2014-09, Revenue from Contracts with Customers (Topic 606) are prepared on the basis of estimates
that can change over time and on the basis of events over which we have no control. It is possible that
analysts and investors may misinterpret our disclosure or that our methods for estimating this disclosure
may differ significantly from others, which could lead to inaccurate or unfavorable forecasts by analysts
and investors.
42

The dual class structure of our common stock has the effect of concentrating voting control
with holders of our Class B common stock, including our CEO, which limits or precludes your
ability to influence corporate matters, including the election of directors and the approval of any
change of control transaction.
Our common stock consists of two classes, including our Class B common stock, which has ten
votes per share, and our Class A common stock, which has one vote per share. As of January 31, 2024,
our Class B common stock held approximately 37% of the total voting power of our common stock, with
our CEO and his affiliates holding substantially all of our Class B common stock. As a result, the holders
of our Class B common stock, including our CEO, could substantially influence all matters submitted to
our stockholders for approval until the earlier of (i) the date specified by a vote of the holders of 66 2/3%
of the outstanding shares of Class B common stock, (ii) April 16, 2028, and (iii) the date the shares of
Class B common stock cease to represent at least 5% of all outstanding shares of our common stock
(such date referred to as the ‘‘Class B expiration’’). Until the Class B expiration, the concentrated
influence held by our Class B common stock limits or precludes your ability to influence corporate
matters, including the election of directors, amendments of our organizational documents, and any
merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction
requiring stockholder approval. In addition, this may prevent or discourage unsolicited acquisition
proposals or offers for our capital stock that you may feel are in your best interest as one of our
stockholders.
Future transfers by holders of Class B common stock will generally result in those shares converting
to Class A common stock, subject to limited exceptions, such as certain permitted transfers effected for
estate planning purposes. The conversion of Class B common stock to Class A common stock will have
the effect, over time, of increasing the relative voting power of those holders of Class B common stock
who retain their shares in the long term.
The dual class structure of our common stock may adversely affect the trading market for our
Class A common stock.
Stock index providers, such as FTSE Russell, exclude or limit the eligibility of public companies with
multiple classes of shares of common stock for certain indices. In addition, several shareholder advisory
firms have announced their opposition to the use of multiple class structures. As a result, the dual class
structure of our common stock may prevent the inclusion of our Class A common stock in such indices
and may cause shareholder advisory firms to publish negative commentary about our corporate
governance practices or otherwise seek to cause us to change our capital structure. Any such exclusion
from indices could result in a less active trading market for our Class A common stock. Any actions or
publications by shareholder advisory firms critical of our corporate governance practices or capital
structure could also adversely affect the value of our Class A common stock.
We do not intend to pay dividends for the foreseeable future.
We have never declared or paid any cash dividends on our common stock and do not intend to pay
any cash dividends in the foreseeable future. Additionally, our ability to pay dividends on our common
stock is limited by restrictions under the terms of our credit facility with Silicon Valley Bank, a division of
First-Citizens Bank & Trust. We anticipate that for the foreseeable future we will retain all of our future
earnings for use in the development of our business and for general corporate purposes. Any
determination to pay dividends in the future will be at the discretion of our Board of Directors. Accordingly,
investors must rely on sales of their common stock after price appreciation, which may never occur, as
the only way to realize any future gains on their investments.
Provisions in our charter documents and under Delaware law and the 2029 Notes and the
Warrants could make an acquisition of our company more difficult, limit attempts by our
stockholders to replace or remove our current management, limit our stockholders’ ability to
obtain a favorable judicial forum for disputes with us or our directors, officers, or employees, and
limit the market price of our Class A common stock.
Provisions in our restated certificate of incorporation and amended and restated bylaws may have
the effect of delaying or preventing a change of control or changes in our management. Our restated
certificate of incorporation and amended and restated bylaws include provisions that:
43

•
provide that our Board of Directors will be classified into three classes of directors with staggered
three-year terms;
•
permit the Board of Directors to establish the number of directors and fill any vacancies and
newly-created directorships;
•
require supermajority voting to amend some provisions in our restated certificate of incorporation
and amended and restated bylaws;
•
authorize the issuance of ‘‘blank check’’ preferred stock that our Board of Directors could use to
implement a stockholder rights plan;
•
provide that only the chairman of our Board of Directors, our chief executive officer, lead
independent director, or a majority of our Board of Directors will be authorized to call a special
meeting of stockholders;
•
provide for a dual class common stock structure in which holders of our Class B common stock
may have the ability to control the outcome of matters requiring stockholder approval, even if
they own significantly less than a majority of the outstanding shares of our common stock,
including the election of directors and significant corporate transactions, such as a merger or
other sale of our company or its assets;
•
prohibit stockholder action by written consent, which requires all stockholder actions to be taken
at a meeting of our stockholders;
•
provide that the Board of Directors is expressly authorized to make, alter, or repeal our bylaws;
and
•
establish advance notice requirements for nominations for election to our Board of Directors or
for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
In addition, our restated certificate of incorporation provides that, to the fullest extent permitted by
law, the Court of Chancery of the State of Delaware is the exclusive forum for: any derivative action or
proceeding brought on our behalf; any action asserting a breach of fiduciary duty; any action asserting a
claim against us arising pursuant to the Delaware General Corporation Law, or DGCL, our restated
certificate of incorporation, or our amended and restated bylaws; or any action asserting a claim against
us that is governed by the internal affairs doctrine. This exclusive forum provision does not apply to suits
brought to enforce a duty or liability created by the Exchange Act. It would apply, however, to a suit that
falls within one or more of the categories enumerated in the exclusive forum provision.
Section 22 of the Securities Act of 1933, as amended (Securities Act), creates concurrent jurisdiction
for federal and state courts over all claims brought to enforce any duty or liability created by the Securities
Act or the rules and regulations thereunder. Our bylaws provide that the federal district courts of the
United States of America will, to the fullest extent permitted by law, be the exclusive forum for resolving
any complaint asserting a cause of action arising under the Securities Act (Federal Forum Provision). Our
decision to adopt a Federal Forum Provision followed a decision by the Supreme Court of the State of
Delaware holding that such provisions are facially valid under Delaware law. While there can be no
assurance that federal or state courts will follow the holding of the Delaware Supreme Court or determine
that the Federal Forum Provision should be enforced in a particular case, application of the Federal
Forum Provision means that suits brought by our stockholders to enforce any duty or liability created by
the Securities Act must be brought in federal court and cannot be brought in state court.
Section 27 of the Exchange Act creates exclusive federal jurisdiction over all claims brought to
enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. In
addition, neither the exclusive forum provision nor the Federal Forum Provision applies to suits brought to
enforce any duty or liability created by the Exchange Act. Accordingly, actions by our stockholders to
enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder must be
brought in federal court. Our stockholders will not be deemed to have waived our compliance with the
federal securities laws and the regulations promulgated thereunder.
44

Any person or entity purchasing or otherwise acquiring or holding any interest in any of our securities
shall be deemed to have notice of and consented to our exclusive forum provisions, including the Federal
Forum Provision. These provisions may limit a stockholders’ ability to bring a claim in a judicial forum of
their choosing for disputes with us or our directors, officers, or other employees, which may discourage
lawsuits against us and our directors, officers, and other employees.
Moreover, we are subject to Section 203 of the DGCL, which may discourage, delay, or prevent a
change of control of our company. Section 203 imposes certain restrictions on mergers, business
combinations, and other transactions between us and holders of 15% or more of our common stock.
Finally, provisions of the 2029 Notes and Warrants may also have the effect of delaying or preventing
a change of control or changes in our management. Holders of the 2029 Notes have the right to require
us to repurchase their notes upon the occurrence of a ‘‘fundamental change’’ (as defined in the indenture
governing the 2029 Notes (the Indenture)) that occurs prior to the maturity date at repurchase price equal
to 100% of the principal amount of the 2029 Notes to be repurchased, plus the sum of the amounts of all
remaining scheduled interest payments (at the 5.50% payment-in-kind interest rate) through and including
the maturity date. Additionally, on and after March 24, 2027, holders of the 2029 Notes have the right, at
each holder’s option and on one or more occasions, to require us, subject to certain exceptions and
deferral provisions, to repurchase all of such holder’s notes equal to 100% of the principal amount of the
notes (or portion thereof) to be so repurchased, plus accrued and unpaid interest, if any, to, but excluding,
the applicable repurchase date. In addition, provisions of (i) the 2029 Notes require an increase to the
conversion rate for 2029 Notes converted in connection with a ‘‘make-whole fundamental change’’ and (ii)
the Warrants require an increase in the number of shares of Class A Common Stock the Warrants are
exercisable for upon the occurrence of a ‘‘make-whole fundamental change’’ (as defined in the indenture
governing the 2029 Notes and the form of Warrant, respectively). Furthermore, the Indenture will prohibit
us from engaging in specified types of mergers or acquisitions unless, among other things, the acquiring
or surviving entity assumes Zuora’s obligations under the 2029 Notes.
Any of these provisions of our charter documents, Delaware law, the 2029 Notes and the Warrants
that have the effect of making an acquisition of our company more difficult or limiting attempts by our
stockholders to replace or remove our current management could limit the price investors are willing to
pay for our Class A common stock.
General Risk Factors
Political developments, economic uncertainty or downturns could adversely affect our
business and operating results.
Political developments impacting government spending and international trade, including future
government shutdowns in the United States or elsewhere, debt ceiling negotiations, potential government
shutdowns, armed conflict such as the conflicts in Ukraine and Israel, retaliatory actions, treaties,
increased barriers, policies favoring domestic industries, increased import or export licensing
requirements or restrictions, trade disputes and tariffs, including the U.S.’s ongoing trade disputes with
China and other countries, inflation, and rising interest rates, may adversely impact markets and cause
weaker macroeconomic conditions. The continuing effect of any or all of these political or other
uncertainties could adversely impact demand for our products, harm our operations and weaken our
financial results.
In addition, in recent years, the United States and other significant markets have experienced cyclical
downturns and worldwide economic conditions remain uncertain. Economic uncertainty and associated
macroeconomic conditions, such as a recession or rising inflation rates or economic slowdown in the
United States or internationally, including due to the ongoing conflicts in Ukraine and Israel, make it
extremely difficult for our customers and us to accurately forecast and plan future business activities, and
could cause our customers to cancel planned purchases or slow spending on our solutions, which could
delay and lengthen sales cycles. Rising inflation may also increase our employee and facilities costs and
decrease demands for our products. Furthermore, during uncertain economic times our customers may
face issues gaining timely access to sufficient credit, which could result in an impairment of their ability to
make timely payments to us. If that were to occur, we may be required to increase our allowance for credit
losses and our results could be adversely impacted.
45

We have customers in a variety of different industries. A significant downturn in the economic activity
attributable to any particular industry may cause organizations to react by reducing their capital and
operating expenditures in general or by specifically reducing their spending on information technology. In
addition, our customers may delay or cancel information technology projects or seek to lower their costs
by renegotiating vendor contracts. To the extent purchases of our solutions are perceived by customers
and potential customers to be discretionary, our revenue may be disproportionately affected by delays or
reductions in general information technology spending. Also, customers may choose to develop in-house
software or modify their legacy business software as an alternative to using our solutions. Moreover,
competitors may respond to challenging market conditions by lowering prices and attempting to lure away
our customers. We cannot predict the timing or duration of any economic slowdown, instability, or
recovery, generally or within any particular industry. If the economic conditions of the general economy or
markets in which we operate worsen from present levels, our business, financial condition, and operating
results could be adversely affected.
We cannot predict the timing, strength, or duration of any economic slowdown or any subsequent
recovery generally, or any industry in particular. If the conditions in the general economy and the markets
in which we operate worsen from present levels, our business, financial condition, and operating results
could be materially and adversely affected.
Moreover, continued disruptions in the banking system, both in the U.S. or abroad, may impact our or
our customers’ liquidity and, as a result, adversely impact our business and operating results.
If we fail to maintain an effective system of disclosure controls and internal control over
financial reporting, our ability to produce timely and accurate financial statements or comply with
applicable regulations could be impaired.
As a public company, we are required, pursuant to Section 404 of the Sarbanes-Oxley Act of 2002
(Sarbanes-Oxley Act), to furnish a report by management on, among other things, the effectiveness of our
internal control over financial reporting. Effective internal control over financial reporting is necessary for
us to provide reliable financial reports and, together with adequate disclosure controls and procedures,
are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties
encountered in their implementation, could cause us to fail to meet our reporting obligations. Ineffective
internal controls could also cause investors to lose confidence in our reported financial information, which
could have an adverse effect on the trading price of our Class A common stock. This management report
will need to include disclosure of any material weaknesses identified by our management in our internal
control over financial reporting, as well as a statement that our independent registered public accounting
firm has issued an opinion on our internal control over financial reporting.
Section 404(b) of the Sarbanes-Oxley Act requires our independent registered public accounting firm
to annually attest to the effectiveness of our internal control over financial reporting, which has required,
and will continue to require, increased costs, expenses, and management resources. An independent
assessment of the effectiveness of our internal controls could detect problems that our management’s
assessment might not. Undetected material weaknesses in our internal controls could lead to financial
statement restatements and require us to incur the expense of remediation. We are required to disclose
changes made in our internal controls and procedures on a quarterly basis. To comply with the
requirements of being a public company, we have undertaken, and may need to further undertake in the
future, various actions, such as implementing new internal controls and procedures and hiring additional
accounting or internal audit staff.
If we are unable to assert that our internal control over financial reporting is effective, or if our
independent registered public accounting firm is unable to express an opinion on the effectiveness of our
internal control, including as a result of any identified material weakness, we could lose investor
confidence in the accuracy and completeness of our financial reports, which would cause the price of our
Class A common stock to decline, and we may be subject to investigation or sanctions by the SEC. In
addition, if we are unable to continue to meet these requirements, we may not be able to remain listed on
the New York Stock Exchange.
46

We may be adversely affected by natural disasters, pandemics, epidemics, and other
catastrophic events, and by man-made problems such as terrorism, that could disrupt our
business operations. Our business continuity and disaster recovery plans may not adequately
protect us from a serious disaster.
Natural disasters, pandemics and epidemics, or other catastrophic events such as fire, power
shortages, and other events beyond our control may cause damage or disruption to our operations,
international commerce, and the global economy, and could have an adverse and material effect on our
business, operating results, and financial condition. For example, as a result of the COVID-19 pandemic
and its impacts on the global economy and financial markets, we experienced certain disruptions to our
business operations, including delays and lengthening of our customary sales cycles, certain customers
not purchasing or renewing our products or services, and requests for pricing and payment concessions
by certain customers. As a result of the pandemic, we have also reduced our office footprint given that
many of our employees continue to work remotely, and we incurred certain impairment charges related to
office leases in the fourth quarter of fiscal 2024, 2023, and 2022 as described in Note 12. Leases of the
Notes to Consolidated Financial Statements, and may incur additional impairment charges in future
periods if we are unable to sublease available office space at our corporate headquarters in California on
acceptable terms. In the event of development of new strains or variants of COVID-19 or other public
health emergencies, climate change, pandemics, or epidemics, we could experience similar or more
significant impacts to our operations, which may adversely impact our business, financial condition and
operating results. More generally, the extent to which a public health crisis or other catastrophic event
could adversely affect economies and financial markets and lead to an economic downturn is highly
uncertain and could harm our business, financial condition, operating results and liquidity.
In the event of a natural disaster, including a major earthquake, blizzard, wildfire, or hurricane, or
other catastrophic event such as a fire, power loss, or telecommunications failure, we may be unable to
continue our operations and may endure system interruptions, reputational harm, delays in development
of our solutions, lengthy interruptions in service, breaches of data security, and loss of critical data, all of
which could have an adverse effect on our future operating results. For example, our corporate
headquarters is located in California, a state that frequently experiences earthquakes and wildfires.
Additionally, all the aforementioned risks may be further increased if we do not implement an effective
disaster recovery plan or our partners’ disaster recovery plans prove to be inadequate.
Investors’ expectations of our performance relating to ESG factors, and our disclosed
performance and aspirations for these practices, may expose us to new risks and require us to
incur additional costs.
Corporate responsibility, including ESG factors, is increasingly becoming a focus from certain
investors, legislators, regulators, employees, and other stakeholders. Some investors may use these
factors to guide their investment strategies and, in some cases, may choose not to invest in us if they
believe our corporate responsibility policies are inadequate. Standards and laws by which ESG efforts are
tracked and measured continue to evolve. For example, in March 2024, the SEC adopted final rules
aimed at enhancing and standardizing climate-related disclosures, which includes quantitative and
qualitative climate-related disclosures. Our efforts to abide by these developing standards and laws may
require significant expenditures. In May 2022, we announced our commitment to remain carbon neutral
going forward, including by purchasing carbon offsets in future years, which may become increasingly
more expensive. In addition, the corporate responsibility criteria could change, which could result in
greater expectations of us and cause us to undertake more costly initiatives to satisfy such new criteria. If
we elect not to or are unable to satisfy such new criteria, investors may conclude that our policies with
respect to corporate responsibility are inadequate. We may face reputational damage in the event that our
corporate responsibility procedures or standards do not meet the standards set by various constituencies.
Furthermore, if our competitors’ corporate responsibility performance is perceived to be greater than
ours, potential or current investors may elect to invest with our competitors instead. Any failure or
perceived failure of previously stated goals, targets and objectives or to satisfy various reporting
standards within the timelines we announce, or not at all, regarding ESG matters, could have negative
impacts on our reputation and business, operating results, and our financial condition could be adversely
impacted.
47

In addition, compliance with ESG-related rules and efforts to meet stakeholder expectations on ESG
matters may place strain on our employees, systems, and resources. Moreover, increasingly, different
stakeholder groups have divergent views on sustainability and ESG matters, which increases the risk that
any action or lack thereof with respect to sustainability or ESG matters will be perceived negatively by at
least some stakeholders and adversely impact our reputation and business. ‘‘Anti-ESG’’ sentiment has
also gained some momentum across the United States, with several states having enacted or proposed
‘‘anti-ESG’’ policies or legislation. If we do not successfully manage ESG-related expectations across
stakeholders, it could erode stakeholder trust, impact our reputation, and adversely affect our business,
financial condition, results of operations and cash flows.
48

Item 1B.
Unresolved Staff Comments
None.
Item 1C.
Cybersecurity
Cybersecurity Risk Management and Strategy
Our approach to risk management is designed to identify, assess, prioritize, and manage material risk
exposures that could impact our ability to execute our corporate strategy and fulfill our business
objectives. Cybersecurity is a critical component of our enterprise risk management approach, and
cybersecurity risks are among the core enterprise risks that are subject to oversight by our Board of
Directors and the Audit Committee of the Board of Directors (Audit Committee). To identify, assess,
prioritize, and manage potential cybersecurity threats, we have integrated the following cybersecurity
safety measures and processes into our overall risk management system:
•
Product Security: We integrate cybersecurity into our systems, applications, and processes so
that security is a key aspect of the design process. Our major products undergo a formal review
process that includes threat modeling, code and dependency scanning and manual code review
to identify and remediate vulnerabilities prior to their final release. In addition, we have
introduced robust access management controls to enhance the security of our offerings.
•
Threat Intelligence and Incident Prevention, Detection, and Response: In the fiscal year
ended January 31, 2024, Zuora procured FS-ISAC membership for threat intelligence and
proactive cybersecurity incident prevention. We maintain a cybersecurity detection and response
program aligned with the National Institute of Standards and Technology’s Cybersecurity
Framework to enable rapid cybersecurity threat detection and response. Additionally, Zuora
established a Governance, Risk, and Compliance Committee (GRC Committee), which includes
our Chief Financial Officer (CFO), Chief Legal Officer (CLO), Chief Information Officer (CIO),
Chief Information Security Officer (CISO), and an Internal Audit representative, and others as
needed, in the fiscal year ended January 31, 2024. We also deploy technical safeguards that are
designed to protect our information systems from cybersecurity threats, including role-based
user and network access controls, vulnerability scanning, security configuration monitoring,
intrusion prevention and detection systems, and anti-malware prevention, which we evaluate and
seek to improve through vulnerability assessments and cybersecurity threat intelligence.
•
Incident Management Procedures: To date, we have not experienced any cybersecurity
incidents that have materially affected or are reasonably likely to materially affect our Company.
We have a well-defined incident response plan that includes procedures and guidelines in the
event of a potential Company crisis, including a potential cybersecurity incident that has the
potential to materially and adversely impact our customers or business operations. Our
guidelines define what is meant by a cybersecurity crisis, identify a core Crisis Management
Team that includes our CFO, CLO, CIO, CISO, and engineering and human resource
management, establish a basic escalation framework, and create a practical communications
protocol. The escalation framework requires that our CEO and Audit Committee (and ultimately,
the full Board of Directors) receive prompt notification if there is a reasonable risk of a material
cybersecurity incident. Following notification, the Crisis Management Team (along with outside
experts as needed) must provide the CEO and the Board of Directors with ongoing updates
regarding the cybersecurity incident until it has been remediated.
•
Training: We have a cybersecurity training program in place for employees. Additionally, our
engineers regularly undergo secure code training.
•
Third-Party Risk Management: Our security experts and our legal team work together to
assess third-party vendors to confirm that each vendor contract requires adequate technical and
organizational measures to protect the systems and data that such vendor operates or
processes on behalf of Zuora. Additionally, we maintain a Supplier Code of Conduct that sets
forth our vendor expectations and a Vendor Data Access Policy that establishes the limits on
what information our vendors may see, access, modify, and control.
49

•
Assessments and Testing: We engage in the periodic assessment and testing of our
cybersecurity policies, processes, and practices. These efforts include a wide range of activities,
including audits, assessments, tabletop exercises, threat modeling, penetration testing, and
other exercises focused on evaluating the effectiveness of our cybersecurity measures. We also
engage third parties (including auditors and cybersecurity consulting firms) to perform
assessments of our cybersecurity measures, including information security maturity
assessments, audits, and independent reviews of our information security control environment
and operating effectiveness. We adjust our cybersecurity policies, processes, and practices
based on the information provided by these assessments and testing activities.
•
Cybersecurity and Privacy Certifications: Zuora has maintained various security certifications,
including ISO 27001, ISO 27002, ISO 27018, ISO 27701, PCI, and SOC 2 Type II.
Cybersecurity Governance
As part of its broader risk oversight activities, the Board of Directors regularly oversees business,
strategic, operational, and financial risks facing Zuora, including cybersecurity risks and mitigation plans,
primarily through delegation to the Audit Committee. As reflected in the Audit Committee Charter, the Audit
Committee periodically reviews with management our cybersecurity and other information technology risks,
controls, and procedures, including Zuora’s plans to mitigate cybersecurity risks and respond to potential data
breaches. To ensure the Audit Committee may carry out these responsibilities, our management team
provides regular information technology and cybersecurity updates, including metrics regarding cyber threat
response preparedness, program maturity milestones, risk mitigation status, and the current and emerging
threat landscape. In addition, the Audit Committee periodically reviews and provides input regarding the level
of information security risk insurance coverage we maintain. The full Board of Directors receives regular
updates on the activities of the Audit Committee, including with regard to cybersecurity oversight. One of our
directors who serves on the Audit Committee recently underwent formal cybersecurity training and earned a
National Association of Corporate Directors CERT Certificate in Cybersecurity Oversight.
In the fiscal year ended January 31, 2024, Zuora also hired a new CISO principally responsible for
overseeing our cybersecurity risk management program, in partnership with other members of
management. Our CISO has served in various roles in cybersecurity and information technology for over
25 years and has experience building security programs and leading global teams at large enterprises
and fast-growing technology companies.
Moreover, our GRC Committee meets bimonthly to evaluate, among other things, cybersecurity
incident response readiness and results of our quarterly cybersecurity tests and annual risk assessment.
The GRC Committee also reviews corporate progress regarding artificial intelligence governance, audits,
and various other security and privacy exercises and addresses any identified gaps in Zuora policies to
prevent, detect, mitigate, and/or remediate any potential cybersecurity incidents.
Finally, as disclosed above, our incident management procedures are designed to notify and actively
involve our Audit Committee and Board of Directors whenever there is a reasonable risk of a material
cybersecurity incident.
Item 2.
Properties
Our corporate headquarters are currently located in Redwood City, California where we currently
utilize approximately 50,000 square feet of office space. We also lease facilities in other areas within the
United States and around the world.
We believe that our current offices provide adequate space to meet our needs for the near term, and
that suitable additional or substitute space will be available as needed to accommodate any future growth
and expansion.
Item 3.
Legal Proceedings
Information with respect to this item may be found in Note 13. Commitments and Contingencies to
the Notes to Consolidated Financial Statements in Item 8. Financial Statements and Supplementary Data,
which is incorporated herein by reference.
50

Item 4.
Mine Safety Disclosures
Not applicable.
51

PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
Market Information for Common Stock
Our Class A common stock began trading on the New York Stock Exchange under the symbol ‘‘ZUO’’
on April 12, 2018. Prior to that date, there was no public trading market for our Class A common stock.
There is no public trading market for our Class B common stock.
Holders of Record
As of February 29, 2024, there were 77 and 43 registered holders of record of our Class A and
Class B common stock, respectively. Because many of our shares of Class A common stock are held by
brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of
stockholders represented by these record holders.
Dividend Policy
We have never declared or paid cash dividends on our capital stock. We do not expect to pay
dividends on our capital stock for the foreseeable future. Instead, we anticipate that all of our earnings for
the foreseeable future will be used for the operation and growth of our business. Any future determination
to declare cash dividends would be subject to the discretion of our Board of Directors and would depend
upon various factors, including our operating results, financial condition, and capital requirements,
restrictions that may be imposed by applicable law, and other factors deemed relevant by our Board of
Directors.
Performance Graph
The performance graph below shall not be deemed ‘‘soliciting material’’ or to be ‘‘filed’’ with the SEC
for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section,
and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act or
the Exchange Act.
We have presented below the cumulative total return to our stockholders from January 31, 2019
through January 31, 2024 in comparison to the Standard & Poor’s 500 Index, Standard & Poor
Information Technology Index and NASDAQ Composite. All values assume a $100 initial investment and
reinvestment of dividends. The comparisons are based on historical data and are not indicative of, nor
intended to forecast, the future performance of our Class A common stock.
52

Company/Index
January 31,
2019
January 31,
2020
January 31,
2021
January 31,
2022
January 31,
2023
January 31,
2024
Zuora . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$100
$ 68.16
$ 68.16
$ 76.85
$ 36.59
$ 42.23
S&P 500 Index . . . . . . . . . . . . . . . . . . . .
$100
$121.68
$142.67
$175.90
$161.45
$195.06
NASDAQ Composite . . . . . . . . . . . . . . .
$100
$127.03
$183.04
$200.70
$164.68
$217.36
S&P 500 Information Technology
Index. . . . . . . . . . . . . . . . . . . . . . . . . . .
$100
$146.07
$200.32
$253.25
$213.50
$320.44
Unregistered Sales of Equity Securities and Use of Proceeds
None.
Issuer Purchases of Equity Securities
None.
Item 6.
[Reserved]
53

Item 7.
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 consolidated financial statements and related notes appearing elsewhere in
this Form 10-K. As discussed in the section titled ‘‘Special Note Regarding Forward-Looking Statements,’’
the following discussion and analysis contains forward-looking statements that involve risks and
uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our
results to differ materially from those expressed or implied by such forward-looking statements. Factors
that could cause or contribute to these differences include, but are not limited to, those identified below
and those discussed in the section titled ‘‘Risk Factors’’ under Part I, Item 1A in this Form 10-K. Our fiscal
year ends January 31.
We have omitted discussion of fiscal 2022 results where it would be redundant to the discussion
previously included in Management’s Discussion and Analysis of Financial Condition and Results of
Operations in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended January 31,
2023, filed with the SEC on April 3, 2023.
Overview
Business Summary
Zuora provides a leading monetization suite for modern businesses, built to help companies launch
and scale new services and operate dynamic, customer-centric business models. Our technology
solutions enable companies across multiple industries and geographies to build, run, and grow a modern,
subscription business, automating the quote-to-revenue process, including offers, billing, collections, and
revenue recognition. With Zuora’s solutions, businesses can change and evolve how they go to market
through a mix of monetization models, efficiently comply with revenue recognition standards, analyze
customer data to optimize their offerings, and build recurring relationships with their customers.
Many of today’s enterprise software systems manage their quote-to-revenue process using software
built for one-time transactions. These systems were not designed for the dynamic, ongoing nature of
recurring revenue, consumption-based, or hybrid pricing models, and can be extremely difficult to
configure. In traditional product-based businesses, quote-to-revenue is a linear process – a customer
orders a product, is billed for that product, payment is collected, and the revenue is recognized. These
legacy product-based systems were not specifically designed to handle the complexities of managing
ongoing customer relationships and recurring revenue models commonly found in subscription
businesses, including billing proration, revenue recognition and reporting, and calculating the lifetime
value of the customer. Using legacy or homegrown software to build a recurring revenue business often
results in inefficient processes with prolonged and complex manual downstream work, hard-coded
customizations, and a proliferation of SKUs.
However, enterprise business models are inherently dynamic, with multiple interactions, flexible
pricing, global complexities, and continuously evolving relationships and events. The capabilities to
launch, price, and bill for products, facilitate and record cash receipts, process and recognize revenue,
and analyze data to drive key decisions are mission critical and particularly complex for companies that
operate at a global scale. As a result, as companies launch, grow, and scale their businesses, they often
conclude that legacy systems are inadequate. This is where Zuora comes in.
Our vision is ‘‘The World Subscribed’’ — the idea that one day every company will be a part of the
Subscription Economy. Our focus has been on providing the technology our customers need to thrive as
customer-centric, recurring revenue businesses.
Our solutions include Zuora Billing, Zuora Revenue, Zuora Payments, Zephr, Zuora Platform, and
other software that support and expand upon these core offerings. Our software helps companies analyze
data – including information such as which customers are delivering the most recurring revenue, or which
segments are showing the highest churn - enabling customers to make informed decisions about their
monetization strategy and quickly implement changes such as launching new services, updating pricing
(usage, time, or outcome based), delivering new offerings, or making other changes to their customers’
54

experience. We also have a large ecosystem of global partners that can assist our customers with
additional monetization strategies and services throughout the subscription journey.
Companies in a variety of industries - technology, manufacturing, media and entertainment,
telecommunications, and many others - are using our solutions to scale and adapt to a world that is
increasingly choosing subscription-based offerings.
Fiscal 2024 Business Highlights
Our business highlights for fiscal 2024 include the following:
•
Subscription revenue grew 13% year-over-year, or 15% on a constant currency basis.
•
Our Annual Recurring Revenue (ARR) was $403.1 million compared to $365.0 million as of
January 31, 2023, representing ARR growth of 10%.
•
We improved our total gross margin by over 460 basis points to 66% for the year, compared to
61% last year.
•
We processed $139.9 billion of billing transactions and payments volume, an increase of
10% year-over-year. We also processed $212.8 billion of revenue volume, an increase of
12% year-over-year.
•
We issued $150.0 million of convertible senior unsecured notes to Silver Lake in September
2023, per the terms of our original agreement, and had $514.2 million in cash, cash equivalents
and short-term investments as of January 31, 2024.
•
In January 2024, we approved a reduction of our workforce by 8% net that is designed to drive
efficiency and optimization throughout the organization.
For a definition of ARR, see ‘‘Management’s Discussion and Analysis of Financial Condition and
Results of Operations—Key Operational and Financial Metrics.’’
Fiscal 2024 Financial Performance Summary
Our financial performance for fiscal 2024, compared to fiscal 2023, reflects the following:
•
Subscription revenue was $383.4 million, an increase of $45.0 million, or 13%, and total revenue
was $431.7 million, an increase of $35.6 million, or 9%.
•
On a constant currency basis, subscription revenue was $388.8 million, an increase of
$50.4 million, or 15% and total revenue was $437.1 million, an increase of $41.0 million, or 10%.
•
Total cost of revenue decreased to $147.0 million, or 34% of total revenue, compared to
$153.2 million, or 39% of total revenue, last year.
•
Loss from operations decreased to $64.4 million, or 15% of revenue, compared to a loss from
operations of $187.5 million, or 47% of revenue, last year.
Key Operational and Financial Metrics
We monitor the following key operational and financial metrics to evaluate our business, measure our
performance, identify trends affecting our business, formulate business plans and make strategic
decisions:
January 31,
2024
2023
Customers with ACV equal to or greater than $250,000. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
461
431
Dollar-based retention rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
106%
108%
Annual recurring revenue growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10%
16%
55

Customers with Annual Contract Value Equal to or Greater than $250,000
We believe our ability to enter into and expand contracts is indicative of broader adoption of our
solutions by larger organizations. It also reflects our ability to expand our revenue footprint within our
current customer base. We define ACV as the subscription revenue we would contractually expect to
recognize from that customer over the next twelve months, assuming no increases or reductions in their
subscriptions. We define the number of customers at the end of any particular period as the number of
parties or organizations that have entered into a distinct subscription contract with us and for which the
term has not ended. Each party with whom we have entered into a distinct subscription contract is
considered a unique customer, and in some cases, there may be more than one customer within a single
organization. The number of customers with ACV equal to or greater than $250,000 increased to 461 as
of January 31, 2024, as compared to 431 as of January 31, 2023. We expect this metric will continue to
increase over time. However, our current strategy to close faster, lighter deals may reduce the growth of
this metric in the near term.
Dollar-Based Retention Rate
We believe our dollar-based retention rate is a key measure of our ability to retain and expand
revenue from our customer base over time. We calculate our dollar-based retention rate as of a period
end by starting with the sum of the ACV from all customers as of twelve months prior to such period end,
or prior period ACV. We then calculate the sum of the ACV from these same customers as of the current
period end, or current period ACV. The current period ACV includes any upsells and also reflects
contraction or attrition over the trailing twelve months, but excludes revenue from new customers added
in the current period. We then divide the current period ACV by the prior period ACV to arrive at our
dollar-based retention rate. Our dollar-based retention rate decreased to 106% as of January 31, 2024, as
compared to 108% as of January 31, 2023. Approximately one percentage point of the decrease was due
to one large customer churn that had not gone live with our services. While the dollar-based retention rate
can fluctuate in any particular period and may decline in the near term, we expect it to remain relatively
consistent or slightly decrease in fiscal 2025.
Annual Recurring Revenue
ARR represents the annualized recurring value at the time of initial booking or contract modification
for all active subscription contracts at the end of a reporting period. ARR excludes the value of
non-recurring revenue such as professional services revenue as well as contracts with new customers
with a term of less than one year. ARR should be viewed independently of revenue and deferred revenue,
and is not intended to be a substitute for, or combined with, any of these items. Our ARR was
$403.1 million as of January 31, 2024, compared to $365.0 million as of January 31, 2023, representing
an increase of 10% year-over-year, compared to 16% growth last year. Our ARR growth was lower in
fiscal 2024 primarily due to macroeconomic conditions that adversely impacted the size of deals and
lengthened deal cycles. While the ARR year-over-year growth rate can fluctuate in any particular period
and may decline in the near term, we expect it to remain relatively consistent or slightly decrease in fiscal
2025.
Components of Our Results of Operations
Revenue
Subscription revenue. Subscription revenue consists of fees for access to, and use of, our products,
as well as customer support and recurring services. We generate subscription fees pursuant to
non-cancelable subscription agreements with terms that typically range from one to five years.
Subscription revenue is primarily based on fees to access our services platform over the subscription
term. We typically invoice customers in advance in either annual or quarterly installments. Customers can
also elect to purchase additional volume blocks or products during the term of the contract. We typically
recognize subscription revenue ratably over the term of the subscription period, beginning on the date
that access to our platform is provisioned, which is generally on or about the date the subscription
agreement is signed. We expect our subscription revenue to increase over time as a percentage of total
revenue as we continue to execute our strategy of executing lighter, faster deals, while maintaining our
focus on large and rapid-growth enterprises.
56

Professional services revenue. Professional services revenue typically consists of fees for
implementation services in connection with helping our customers deploy, configure, and optimize the use
of our solutions. These services include systems integration, data migration, and process enhancement.
Professional services projects generally take three to twelve months to complete. Once the contract is
signed, we generally invoice for professional services on a time and materials basis, although we
occasionally engage in fixed-price service engagements and invoice for those based upon agreed
milestone payments. We recognize revenue as professional services are performed for time and
materials engagements and on a proportional performance method when the professional services are
performed under fixed fee engagements. While we will continue to utilize our own services team, we
expect to continue to leverage our strategic partners for professional services implementations, and as a
result we expect our professional services revenue to decrease over time as a percentage of total
revenue.
Deferred Revenue
Deferred revenue consists of customer billings in advance of revenue being recognized from our
subscription and support services and professional services arrangements. We primarily invoice our
customers for subscription services arrangements annually, semi-annually, or quarterly in advance.
Amounts anticipated to be recognized within one year of the balance sheet date are recorded as deferred
revenue, current portion, and the remaining portion is recorded as deferred revenue, net of current portion
in our consolidated balance sheets.
Overhead Allocation and Employee Compensation Costs
We allocate shared costs, such as facilities costs (including rent, utilities, and depreciation on capital
expenditures related to facilities shared by multiple departments), information technology costs, and
certain administrative personnel costs to all departments based on headcount and location. As such,
allocated shared costs are reflected in each cost of revenue and operating expenses category.
Employee compensation costs consist of salaries, bonuses, commissions, benefits, and stock-based
compensation.
Cost of Revenue, Gross Profit and Gross Margin
Cost of subscription revenue. Cost of subscription revenue consists primarily of costs related to
hosting our platform and providing customer support. These costs include third-party hosting fees,
employee compensation costs associated with maintaining our cloud-based infrastructure, amortization
expenses associated with capitalized internal-use software and purchased technology, allocated
overhead, software and maintenance costs, and outside services associated with the delivery of our
subscription services. We intend to continue to invest in our platform infrastructure, including third-party
hosting capacity, and support organizations. However, the level and timing of such investment in these
areas may fluctuate and affect our cost of subscription revenue in the future.
Cost of professional services revenue. Cost of professional services revenue consists primarily of
costs related to the deployment of our solutions. These costs include employee compensation costs for
our professional services team, allocated overhead, travel costs, and costs of outside services associated
with supplementing our internal staff. We believe that investment in our systems integrator partner
network will lead to total margin improvement over time, however costs may fluctuate as we continue to
shift deployments to our partner network.
Gross profit and gross margin. Our gross profit and gross margin may fluctuate from period to period
as our revenue fluctuates, and as a result of the timing and amount of our investments to expand hosting
capacity, including through third-party cloud providers, amortization expenses associated with our
capitalized internal-use software and purchased technology, and our continued efforts to build our cloud
infrastructure, support, and professional services teams. Over time, we expect our subscription gross
margin to increase slightly due to increased subscription revenue, and professional services gross margin
to remain relatively consistent.
57

Operating Expenses
Research and development. Research and development expense consists primarily of employee
compensation costs, allocated overhead, and travel costs. We capitalize research and development costs
associated with the development of internal-use software and we generally amortize these costs over a
period of three years into the cost of subscription revenue. All other research and development costs are
expensed as incurred. We recognize that continued investment in our platform is important for our growth
and we will continue to focus investments in key areas of our platform. We expect our research and
development expense to decrease as a percentage of total revenue over time to the extent our revenue
grows and we gain operating efficiencies.
Sales and marketing. Sales and marketing expense consists primarily of employee compensation
costs, including the amortization of deferred commissions related to our sales personnel, allocated
overhead, costs of general marketing and promotional activities, and travel costs. Commission costs that
are incremental to obtaining a contract are amortized in sales and marketing expense over the period of
benefit, which is expected to be five years. While we expect to continue to make investments as we
expand our customer acquisition and retention efforts, we expect our sales and marketing expense to
decrease as a percentage of total revenue over time to the extent our revenue grows and due to lower
employee-related costs following the workforce reduction in January 2024.
General and administrative. General and administrative expense consists primarily of employee
compensation costs, allocated overhead, and travel costs for finance, accounting, legal, human
resources, and recruiting personnel. In addition, general and administrative expense includes
non-personnel costs, such as accounting fees, legal fees, charitable contributions, asset impairments,
and all other supporting corporate expenses not allocated to other departments. We expect to incur
ongoing costs as a result of operating as a public company, including costs related to compliance and
reporting obligations of public companies, and continued investment to support our growing operations.
We expect our general and administrative expense to decrease as a percentage of total revenue over
time to the extent our revenue grows and due to lower employee-related costs following the workforce
reduction in January 2024.
Other income and expenses
Other income and expenses primarily consists of fair value adjustments related to the debt
conversion and warrant liabilities; amortization of deferred loan costs and contractual interest on our
convertible senior notes; interest income from our cash and cash equivalents and short-term investments;
and foreign exchange fluctuations.
Income Tax Provision
Income tax provision consists primarily of income taxes related to foreign and state jurisdictions in
which we conduct business. We maintain a full valuation allowance on our federal and state deferred tax
assets as we have concluded that it is more likely than not that the deferred assets will not be utilized.
58

Results of Operations
The following tables set forth our consolidated results of operations data for the periods presented in
dollars and as a percentage of our total revenue:
Fiscal Year Ended January 31,
2024
2023
(in thousands)
Revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$383,396
$ 338,391
Professional services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48,265
57,696
Total revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
431,661
396,087
Cost of revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
84,599
81,094
Professional services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
62,375
72,135
Total cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
146,974
153,229
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
284,687
242,858
Operating expenses:
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108,288
102,564
Sales and marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
166,215
173,871
General and administrative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
74,591
78,878
Litigation settlement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
75,000
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
349,094
430,313
Loss from operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(64,407)
(187,455)
Change in fair value of debt conversion and warrant liabilities. . . . . . . . . . . . . .
(2,234)
9,214
Interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(21,480)
(15,133)
Interest and other income (expense), net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
22,079
5,986
Loss before income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(66,042)
(187,388)
Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,151
10,582
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (68,193)
$(197,970)
Fiscal Year Ended January 31,
2024
2023
Revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
89%
85%
Professional services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
15
Total revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100
100
Cost of revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
20
20
Professional services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14
18
Total cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
34
39
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
66
61
Operating expenses:
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
26
Sales and marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39
44
General and administrative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17
20
Litigation settlement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
19
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
81
109
Loss from operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(15)
(47)
Change in fair value of debt conversion and warrant liabilities. . . . . . . . . . . . . .
(1)
2
Interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)
(4)
Interest and other income (expense), net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
2
Loss before income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(15)
(47)
Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
3
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(16)%
(50)%
Note: Percentages in the table above may not sum due to rounding.
59

Non-GAAP Financial Measures
To supplement our consolidated financial statements presented in accordance with U.S. GAAP, we
monitor and consider non-GAAP financial measures including: non-GAAP cost of subscription revenue,
non-GAAP subscription gross margin, non-GAAP cost of professional services revenue, non-GAAP
professional services gross margin, non-GAAP gross profit, non-GAAP gross margin, non-GAAP income
from operations, non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss)
per share, basic and diluted, adjusted free cash flow, and subscription revenue and total revenue that
exclude the impact of foreign currency exchange rate fluctuations (constant currency basis). We use
non-GAAP financial measures in conjunction with GAAP 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. We believe these non-GAAP measures provide investors
consistency and comparability with our past financial performance and facilitate period-to-period
comparisons of our operating results. We also believe these non-GAAP measures are useful in evaluating
our operating performance compared to that of other companies in our industry, as they generally
eliminate the effects of certain items that may vary for different companies for reasons unrelated to overall
operating performance.
Investors are cautioned that there are material limitations associated with the use of non-GAAP
financial measures as an analytical tool. The non-GAAP financial measures we use may be different from
non-GAAP financial measures used by other companies, limiting their usefulness for comparison
purposes. We compensate for these limitations by providing specific information regarding the GAAP
items excluded from our non-GAAP financial measures. The presentation of these non-GAAP financial
measures is not intended to be considered in isolation or as a substitute for, or superior to, financial
information prepared and presented in accordance with GAAP. Reconciliations of our non-GAAP financial
measures to the nearest respective GAAP measures are provided below.
We exclude the following items from one or more of our non-GAAP financial measures:
•
Stock-based compensation expense. We exclude stock-based compensation expense, which is
a non-cash expense, because we believe that excluding this item provides meaningful
supplemental information regarding operational performance. In particular, stock-based
compensation expense is not comparable across companies given it is calculated using a variety
of valuation methodologies and subjective assumptions.
•
Amortization of acquired intangible assets. We exclude amortization of acquired intangible
assets, which is a non-cash expense, because we do not believe it has a direct correlation to the
operation of our business.
•
Charitable contributions. We exclude expenses associated with charitable donations of our
common stock. We believe that excluding these non-cash expenses allows investors to make
more meaningful comparisons between our operating results and those of other companies.
•
Shareholder litigation. We exclude non-recurring charges and benefits, net of insurance
recoveries, including litigation expenses and settlements, related to shareholder litigation matters
that are outside of the ordinary course of our business. We believe these charges and benefits
do not have a direct correlation to the operations of our business and may vary in size
depending on the timing and results of such litigation and related settlements.
•
Asset impairment. We exclude non-cash charges for impairment of assets, including
impairments related to internal-use software, office leases, and acquired intangible assets.
Impairment charges can vary significantly in terms of amount and timing and we do not consider
these charges indicative of our current or past operating performance. Moreover, we believe that
excluding the effects of these charges allows investors to make more meaningful comparisons
between our operating results and those of other companies.
60

•
Change in fair value of debt conversion and warrant liabilities. We exclude fair value adjustments
related to the debt conversion and warrant liabilities, which are non-cash gains or losses, as they
can fluctuate significantly with changes in our stock price and market volatility, and do not reflect
the underlying cash flows or operational results of the business.
•
Acquisition-related transactions. We exclude acquisition-related transactions (including
integration-related charges) that are not related to our ongoing operations, including expenses
we incurred and gains or losses recognized on contingent consideration related to our
acquisition of Zephr. We do not consider these transactions reflective of our core business or
ongoing operating performance.
•
Workforce reductions. We exclude charges related to workforce reduction plans, including
severance, health care and related expenses. We believe these charges are not indicative of our
continuing operations.
The following tables provide a reconciliation of our GAAP to non-GAAP measures (in thousands,
except percentages and per share data):
Subscription Gross Margin
Fiscal Year Ended January 31,
2024
2023
Reconciliation of cost of subscription revenue:
GAAP cost of subscription revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$84,599
$81,094
Less:
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(8,979)
(8,141)
Amortization of acquired intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2,690)
(2,236)
Workforce reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1,778)
(547)
Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(615)
—
Non-GAAP cost of subscription revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$70,537
$70,170
GAAP subscription gross margin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
78%
76%
Non-GAAP subscription gross margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
82%
79%
Professional Services Gross Margin
Fiscal Year Ended January 31,
2024
2023
Reconciliation of cost of professional services revenue:
GAAP cost of professional services revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 62,375
$ 72,135
Less:
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(11,567)
(12,297)
Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(291)
—
Workforce reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(118)
(646)
Non-GAAP cost of professional services revenue . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 50,399
$ 59,192
GAAP professional services gross margin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(29)%
(25)%
Non-GAAP professional services gross margin . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)%
(3)%
Total Gross Margin
Fiscal Year Ended January 31,
2024
2023
Reconciliation of gross profit:
GAAP gross profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$284,687
$242,858
Add:
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
20,546
20,438
Amortization of acquired intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,690
2,236
61

Fiscal Year Ended
January 31,
2024
2023
Workforce reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,896
1,193
Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
906
—
Non-GAAP gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$310,725
$266,725
GAAP gross margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
66%
61%
Non-GAAP gross margin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
72%
67%
Operating (Loss) Income and Operating Margin
Fiscal Year Ended January 31,
2024
2023
Reconciliation of (loss) income from operations:
GAAP loss from operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (64,407)
$(187,455)
Add:
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
101,052
96,401
Workforce reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,249
6,369
Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,811
4,537
Amortization of acquired intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,690
2,236
Acquisition-related transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
211
3,153
Charitable contribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
1,000
Shareholder litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3,112)
76,268
Non-GAAP income from operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 47,494
$
2,509
GAAP operating margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(15)%
(47)%
Non-GAAP operating margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11%
1%
Net (Loss) Income and Net (Loss) Income Per Share
Fiscal Year Ended January 31,
2024
2023
Reconciliation of net (loss) income:
GAAP net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (68,193)
$(197,970)
Add:
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
101,052
96,401
Workforce reduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,249
6,369
Asset impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,811
4,537
Amortization of acquired intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,690
2,236
Change in fair value of debt conversion and warrant liabilities. . . . . . . . . . . . . .
2,234
(9,214)
Acquisition-related transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
211
3,153
Charitable contribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
1,000
Shareholder litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3,112)
76,268
Non-GAAP net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 45,942
$ (17,220)
GAAP net loss per share, basic and diluted1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
(0.49)
$
(1.51)
Non-GAAP net income loss per share, basic and diluted1 . . . . . . . . . . . . . . . . . . .
$
0.33
$
(0.13)
(1)
GAAP and Non-GAAP net (loss) income per share are calculated based upon 140.1 million and 131.4 million basic and diluted
weighted-average shares of common stock for the fiscal year ended January 31, 2024 and 2023, respectively.
Adjusted Free Cash Flow
Adjusted free cash flow is a non-GAAP measure that excludes acquisition-related costs (including
integration-related charges) and expenses related to non-ordinary course litigation (including settlement
charges) from GAAP operating cash flows, and includes capital expenditures. We include the impact of
62

net purchases of property and equipment in our adjusted free cash flow calculation because we consider
these capital expenditures to be a necessary component of our ongoing operations. We consider adjusted
free cash flow to be a liquidity measure that provides useful information to management and investors
about the amount of cash generated by our business, excluding such expenditures that are not related to
our ongoing operations, but it is not intended to represent the residual cash flow available for
discretionary expenditures.
Fiscal Year Ended January 31,
2024
2023
(in thousands)
Net cash used in operating activities (GAAP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (18,767)
$ (20,644)
Add:
Shareholder litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
72,913
251
Acquisition-related costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
135
3,186
Less:
Purchases of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(9,987)
(10,634)
Adjusted free cash flow (non-GAAP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 44,294
$ (27,841)
Net cash used in investing activities (GAAP). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (84,277)
$(131,074)
Net cash provided by financing activities (GAAP). . . . . . . . . . . . . . . . . . . . . . . . . . .
$156,542
$ 241,911
Constant Currency Revenue
We provide subscription revenue and total revenue, including year-over-year growth rates, adjusted
to remove the impact of foreign currency rate fluctuations, which we refer to as constant currency. We
believe providing revenue on a constant currency basis helps our investors to better understand our
underlying performance. We calculate constant currency in a given period by applying the average
currency exchange rates in the comparable period of the prior year to the local currency revenue in the
current period.
Fiscal Year Ended January 31,
2024
2023
% Change
(dollars in thousands)
Subscription revenue (GAAP). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$383,396
$338,391
13%
Effects of foreign currency rate fluctuations . . . . . . . . . . . . . . . . . . . .
5,418
Subscription revenue on a constant currency basis (Non-GAAP) . . .
$388,814
15%
Total revenue (GAAP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$431,661
$396,087
9%
Effects of foreign currency rate fluctuations . . . . . . . . . . . . . . . . . . . .
5,403
Total revenue on a constant currency basis (Non-GAAP) . . . . . . . . . .
$437,064
10%
63

Comparison of the Fiscal Years Ended January 31, 2024 and 2023
Revenue
Fiscal Year Ended January 31,
2024
2023
$ Change % Change
(dollars in thousands)
Revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$383,396
$338,391
$45,005
13%
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48,265
57,696
(9,431)
(16)%
Total revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$431,661
$396,087
$35,574
9%
Percentage of total revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
89%
85%
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
15
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100%
100%
Subscription revenue increased by $45.0 million, or 13%, for fiscal 2024 compared to fiscal 2023, or
15% on a constant currency basis, which removes the impact of foreign currency fluctuations. The
increase was driven by growth in our customer base, with new customers contributing approximately
$13.2 million of the increase in subscription revenue, and increased transaction volume and sales of
additional products to our existing customers contributing the remainder. We calculate subscription
revenue from new customers during the fiscal year by adding the revenue recognized from new
customers acquired in the 12 months prior to the reporting date. The new business growth reflects the
impact of macroeconomic headwinds we faced and our focus on executing on lighter, faster sales in fiscal
2024.
Professional services revenue decreased by $9.4 million, or 16%, for fiscal 2024 compared to fiscal
2023 as we continued to leverage our system integration partners for implementing our solutions, and due
to the non-linearity and timing of projects.
Cost of Revenue and Gross Margin
Fiscal Year Ended January 31,
2024
2023
$ Change % Change
(dollars in thousands)
Cost of revenue:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 84,599
$ 81,094
$ 3,505
4%
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
62,375
72,135
(9,760)
(14)%
Total cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$146,974
$153,229
$(6,255)
(4)%
Gross margin:
Subscription. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
78%
76%
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(29)%
(25)%
Total gross margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
66%
61%
Cost of subscription revenue increased by $3.5 million, or 4%, for fiscal 2024 compared to fiscal
2023. Employee compensation costs increased $2.6 million due to higher headcount to support our
growth and operations which partially contributed to a reduction in outside professional services costs of
$2.6 million. Additionally, we incurred increases of $1.2 million in incremental workforce reduction related
charges, $0.8 million of amortization of capitalized internal-use software costs and purchased technology,
$0.6 million in third-party software costs, and $0.6 million in intellectual property asset and software
impairment charges.
64

Cost of professional services revenue decreased by $9.8 million, or 14%, for fiscal 2024 compared to
fiscal 2023. Leveraging our system integration partners for leading customer implementations has allowed us
reduce our headcount and professional services costs. As a result, in fiscal 2024, we had decreases of
$5.7 million in employee compensation costs, $3.7 million in outside professional services costs, and
$0.5 million in allocated overhead.
Our gross margin for subscription services increased to 78% for fiscal 2024 compared to 76% for
fiscal 2023, primarily due to increased subscription revenue.
Our gross margin for professional services decreased to (29)% for fiscal 2024 compared to (25)% for
fiscal 2023, primarily due to supporting our system integration partners in leading customer
implementations and continued investment in our customers.
Operating Expenses
Research and Development
Fiscal Year Ended January 31,
2024
2023
$ Change % Change
(dollars in thousands)
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$108,288
$102,564
$5,724
6%
Percentage of total revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25%
26%
Research and development expense increased by $5.7 million, or 6%, for fiscal 2024 compared to
fiscal 2023. This was driven primarily by increased headcount to support our development efforts resulting
in higher employee compensation costs of $8.0 million, partially offset by a $5.7 million decrease in
outside professional services costs as we decreased our utilization of outside services. We also incurred
higher incremental costs relative to last year of $1.6 million related to workforce reduction related
charges, $1.4 million in allocated overhead primarily due to increased headcount, $1.2 million in
impairment of certain capitalized software, and $0.8 million in travel costs. These costs were partially
offset by a $1.1 million reduction in third-party software costs, and $1.0 million higher capitalization of
internal-use software.
Research and development expense decreased to 25% of total revenue in fiscal 2024 from 26% in
fiscal 2023, primarily due to higher total revenue in fiscal 2024.
Sales and Marketing
Fiscal Year Ended January 31,
2024
2023
$ Change % Change
(dollars in thousands)
Sales and marketing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$166,215
$173,871
$(7,656)
(4)%
Percentage of total revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39%
44%
Sales and marketing expense decreased by $7.7 million, or 4%, for fiscal 2024 compared to fiscal
2023. This was driven by decreased headcount as we reduced primarily non-quota carrying roles,
resulting in lower employee compensation costs of $7.0 million, and a $0.9 million decrease in outside
professional services costs as we decreased utilization of outside services. We also incurred $1.6 million
lower workforce reduction related charges relative to last year, and had $1.2 million in lower allocated
overhead costs. These cost reductions were partially offset by $3.0 million in higher event and travel costs
as we held additional events in fiscal 2024 including Subscribed Live and Subscribed Connect, and
$0.6 million in additional third-party software costs.
Sales and marketing expense decreased to 39% of total revenue during fiscal 2024 compared to
44% during fiscal 2023 primarily as a result of lower employee compensation costs and higher total
revenue in fiscal 2024.
65

General and Administrative
Fiscal Year Ended January 31,
2024
2023
$ Change % Change
(dollars in thousands)
General and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$74,591
$78,878
$(4,287)
(5)%
Percentage of total revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17%
20%
General and administrative expense decreased by $4.3 million, or 5%, for fiscal 2024 compared to
fiscal 2023. This decrease was driven by $4.4 million lower securities litigation related expenses as we
reached a settlement in fiscal 2024, a $4.1 million reduction in outside professional services costs which
were higher last year partly due to acquisition-related costs, and a $2.5 million reduction in allocated
overhead driven by lower impairment charges associated with our headquarters as compared to last year.
These cost reductions were partially offset by increases of $5.4 million in employee compensation costs
driven by increased stock-based compensation expenses, and $1.0 million in other tax related charges.
General and administrative expense decreased to 17% of total revenue during fiscal 2024 compared
to 20% during fiscal 2023, primarily due to decreased securities litigation related expenses in fiscal 2024.
Litigation settlement
In January 2023, we accrued $75.0 million related to the then-anticipated settlement of the federal
securities class action litigation captioned Roberts v. Zuora, Inc., which we recorded as Litigation
settlement in the consolidated statement of comprehensive loss for the fiscal year ended January 31,
2023. For additional updates, see Note 13. Commitments and Contingencies of the Notes to Consolidated
Financial Statements.
Other Income and Expenses
Fiscal Year Ended January 31,
2024
2023
$ Change
% Change
(in thousands)
Change in fair value of debt conversion and warrant
liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (2,234)
$
9,214
$(11,448)
(124)%
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(21,480)
$(15,133)
$ (6,347)
42%
Interest and other income (expense), net. . . . . . . . . . . . . . . . .
$ 22,079
$
5,986
$ 16,093
269%
During fiscal 2024, we recognized a $2.2 million loss on revaluation of the debt conversion and
warrant liabilities, compared to a $9.2 million gain recognized on revaluation of the warrant liability during
fiscal 2023. These fluctuations were primarily driven by the impact of changes in the market value of
Zuora’s common stock on the valuations. Interest expense increased $6.3 million due to the issuance of
the Additional Notes in September 2023 and a full year of interest recognized in fiscal 2024 on the Initial
Notes that were issued in March 2022 (fiscal 2023). Refer to Note 9. Debt of the Notes to Consolidated
Financial Statements for definitions of the Initial Notes and Additional Notes. Interest and other income
(expense), net increased $16.1 million primarily due to higher interest rates on cash equivalents and
short-term investments, and foreign currency impacts of revaluing cash, accounts receivable, and
payables recorded in a foreign currency.
Income Tax Provision
Fiscal Year Ended January 31,
2024
2023
$ Change % Change
(in thousands)
Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,151
$10,582
$(8,431)
(80)%
We are subject to federal and state income taxes in the United States and taxes in foreign
jurisdictions. For fiscal 2024 and fiscal 2023 we recorded a tax provision of $2.2 million and $10.6 million
on losses before income taxes of $66.0 million and $187.4 million, respectively. The effective tax rate for
66

fiscal 2024 and fiscal 2023 was (3.3)% and (5.6)%, respectively. The effective tax rates differ from the
statutory rate primarily as a result of providing no benefit on pretax losses incurred in the United States.
For fiscal 2024 and fiscal 2023, we maintained a full valuation allowance on our U.S. federal and state net
deferred tax assets as it was more likely than not that those deferred tax assets will not be realized. The
decrease in tax expense resulted primarily from lower foreign taxes in fiscal 2024 as fiscal 2023 included
tax impacts related to the acquisition of Zephr.
Liquidity and Capital Resources
Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and
long-term cash requirements of our business operations.
As of January 31, 2024, we had cash and cash equivalents and short-term investments of
$514.2 million that were primarily invested in deposit accounts, money market funds, corporate debt
securities, commercial paper, and U.S. government securities. Our investments are highly rated and
currently mature in one year or less. In addition to cash and investments, we finance our operations
through cash flows generated from sales to our customers, which are generally billed in advance on an
annual, semi-annual, or quarterly basis.
In the short-term, we have our cash and investments, cash generated from our business, and our
$30.0 million credit line available to fund our ongoing business operations as well as to finance any future
acquisitions. In the long-term, we expect cash generated from our operations to increase, improving our
ability to fund our operations and repay our debt obligations. The 2029 Notes issued to Silver Lake
includes a conversion feature that, if triggered, will convert the notes to shares of our Class A common
stock, after which we would no longer be required to repay the debt balance. The 2029 Notes are
scheduled to mature in March 2029, but may be called by the noteholder as early as March 2027. If the
2029 Notes have not been converted by the maturity date or if they are otherwise called by the noteholder
prior to maturity, we would be required to repay the debt balance in cash. Additionally, in connection with
the 2029 Notes, we issued Warrants for 7.5 million shares of our Class A common stock that are
exercisable between $20.00 - $24.00 per share which, if exercised, would contribute additional liquidity to
our business. Refer to Note 9. Debt and Note 17. Warrants to Purchase Shares of Common Stock of the
Notes to Consolidated Financial Statements.
We believe our existing cash and cash equivalents, marketable securities, and cash flow from
operations will be sufficient for at least the next 12 months to meet our requirements and plans for cash,
including meeting our working capital requirements and capital expenditure requirements, servicing our
debt and funding future acquisitions. In addition, we expect to have access to sufficient capital to repay
the 2029 Notes if they are required to be settled in cash. For additional information about our debt, credit
line and warrants see Note 9. Debt, and Note 17. Warrants to Purchase Shares of Common Stock of the
Notes to Consolidated Financial Statements.
Our ability to support our requirements and plans for cash, including meeting our working capital and
capital expenditure requirements, will depend on many factors, including our revenue growth rate, the
timing and the amount of cash received from customers, the expansion of sales and marketing activities,
the timing and extent of spending to support research and development efforts, the repayment of the
2029 Notes, the cost to develop and support our offering, the introduction of new products and services,
the continuing adoption of our products by customers, any acquisitions or investments that we make in
complementary businesses, products, and technologies, and our ability to obtain equity or debt financing.
We continually evaluate our capital needs and may decide to raise additional capital to fund the
growth of our business for general corporate purposes through public or private equity offerings or
through additional debt financing. We also may in the future make investments in or acquire businesses
or technologies that could require us to seek additional equity or debt financing. To facilitate acquisitions
or investments, we may seek additional equity or debt financing, which may not be available on terms
favorable to us or at all. Sales of additional equity could result in dilution to our stockholders. We expect
proceeds from the exercise of stock options in future years to be impacted by the increased mix of
restricted stock units versus stock options granted to employees and to vary based on our share price.
67

Cash Flows
The following table summarizes our cash flows for the periods indicated:
Fiscal Year Ended January 31,
2024
2023
(in thousands)
Net cash used in operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (18,767)
$ (20,644)
Net cash used in investing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(84,277)
(131,074)
Net cash provided by financing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
156,542
241,911
Effect of exchange rates on cash and cash equivalents. . . . . . . . . . . . . . . . . . .
(672)
(461)
Net increase in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 52,826
$
89,732
Operating Activities
Net cash used in operating activities of $18.8 million in fiscal 2024 was comprised primarily of
payments for our personnel, sales and marketing efforts, payments to vendors for products and services
related to our ongoing business operations, payments for shareholder litigation charges, customer
collections for our subscription and professional services, interest income received on our cash
equivalents and short-term investments, and interest paid on the 2029 Notes.
Net cash used in operating activities for fiscal 2024 decreased $1.9 million compared to the fiscal
2023. We paid $72.9 million in shareholder litigation charges in fiscal 2024. This was partially offset by
cash provided by increased customer collections, a higher gross margin on our subscription services, cost
reductions associated with the workforce reduction approved in November 2022, and increased interest
generated from our cash equivalents and short-term investments.
Investing Activities
Net cash used in investing activities for fiscal 2024 was $84.3 million. We purchased $69.8 million of
short-term investments, net of maturities, used $10.0 million to purchase property and equipment and to
develop internal-use software as we continue to invest in and grow our business, and paid $4.5 million of
contingent consideration in connection with the acquisition of Zephr.
Net cash used in investing activities for fiscal 2024 decreased $46.8 million compared to fiscal 2023
primarily due to $41.0 million in net cash paid to acquire Zephr in fiscal 2023 compared to a $4.5 million
contingent consideration payment we made for the Zephr acquisition in fiscal 2024, per the terms of the
acquisition agreement. We also used $9.7 million less cash for short-term investments in fiscal 2024 due
to the timing of purchases and maturities as compared to fiscal 2023 and holding more cash equivalents
in fiscal 2024 due to rising interest rates. Payments for property and equipment, net of insurance
recoveries, were $0.6 million lower compared to fiscal 2023.
Financing Activities
Net cash provided by financing activities for fiscal 2024 of $156.5 million was due to $145.9 million in
net proceeds from issuance of the Additional Notes, $8.4 million of proceeds from issuance of common
stock under the ESPP, and $2.3 million in proceeds from stock option exercises.
Net cash provided by financing activities for fiscal 2024 decreased $85.4 million compared to fiscal
2023 primarily as a result of receiving $88.0 million less cash from the second debt issuance in fiscal
2024 as compared to the first debt issuance last year, per the terms of our original agreement with Silver
Lake. We made no principal payments associated under the credit facility with Silicon Valley Bank, a
division of First-Citizens Bank & Trust (SVB), in fiscal 2024 as we fully paid down the term loan portion of
the SVB credit facility in fiscal 2023, and we received more cash from our ESPP plan participants due to
higher participation in fiscal 2024, which together provided $2.9 million of additional cash flows in fiscal
2024 over fiscal 2023.
Obligations and Other Commitments
Our material cash requirements from known contractual and other obligations consist of obligations
under our operating leases for office space, the 2029 Notes, and a contractual commitment to one of our
68

vendors for cloud computing services. For more information, please refer to Note 12. Leases, Note 9.
Debt and Note 13. Commitments and Contingencies, respectively, of the Notes to Consolidated Financial
Statements. As of January 31, 2024, our contractual commitments totaled $513.5 million, with
$36.1 million committed within the next twelve months.
In the ordinary course of business, we enter into agreements of varying scope and terms pursuant to
which we agree to indemnify customers, vendors, lessors, business partners, and other parties with
respect to certain matters, including, but not limited to, losses arising out of the breach of such
agreements, services to be provided by us, or from data breaches or intellectual property infringement
claims made by third parties. In addition, we have entered into indemnification agreements with our
directors and certain officers and employees that will require us, among other things, to indemnify them
against certain liabilities that may arise by reason of their status or service as directors, officers, or
employees. As of January 31, 2024, no demands had been made upon us to provide indemnification
under such agreements and there were no claims that we are aware of that could have a material effect
on our consolidated balance sheets, consolidated statements of comprehensive loss, or consolidated
statements of cash flows.
Critical Accounting Policies and Estimates
Our consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation
of these consolidated financial statements requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements, and the reported amounts of revenue and expenses during the
applicable periods. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are
based on historical experience and various other factors that we believe to be reasonable under the
circumstances. Our actual results could differ from these estimates.
We believe that of our significant accounting policies, which are described in Note 2. Summary of
Significant Accounting Policies and Recent Accounting Pronouncements of the Notes to Consolidated
Financial Statements, the following accounting policy includes estimates and assumptions with a greater
degree of judgment and complexity.
Revenue Recognition Policy
Our revenue recognition policy follows guidance from Topic 606, Revenue from Contracts with
Customers. We derive our revenue primarily from subscription fees and professional services fees.
Determining whether products and services are distinct performance obligations that should be accounted
for separately or combined as one unit of accounting may require significant judgment.
Our cloud-based software subscriptions are distinct as such hosted services are often sold
separately. In addition, our subscription services contracts can include multi-year agreements that include
a fixed annual platform fee and a volume block usage fee that may vary based on permitted volume
usage each year. To the extent that permitted volume usage each year is the same, we concluded that
there is one multi-year stand-ready performance obligation. To the extent that permitted volume usage
each year varies, we concluded that each year represents a distinct stand-ready performance obligation
and we allocate the transaction price to the performance obligation on a relative standalone-selling price
basis and revenue is recognized ratably over each year.
In determining whether professional services are distinct, we consider the following factors for each
professional services agreement: availability of the services from other vendors, the nature of the
professional services, the timing of when the professional services contract was signed in comparison to
the cloud-based software, start date and the contractual dependence of the cloud-based software on the
customer’s satisfaction with the professional services work. To date, we have concluded that all of the
professional services included in contracts with multiple performance obligations are distinct.
The determination of standalone selling price (SSP) for each distinct performance obligation requires
judgment. We establish SSP for both our subscription services and professional services elements
primarily by considering the actual sales prices of the element when sold on a stand-alone basis or when
sold together with other elements. Our actual sales prices for subscription services and professional
69

services for stand-alone sales do not typically vary from our prices for each element when sold together
with other elements. When we are unable to rely on actual observable SSPs, we determine SSP based
on inputs such as actual sales prices when sold together with other promised subscriptions or services
and our overarching pricing objectives and strategies.
Recent Accounting Pronouncements — Not Yet Adopted
In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards
Update (ASU) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment
Disclosures. This ASU is intended to improve reportable segment disclosure requirements, primarily
through enhanced disclosures about significant segment expenses. ASU 2023-07 will be effective for us
for annual periods beginning with our fiscal year ending January 31, 2025, and interim periods thereafter.
Early adoption is permitted. We are currently evaluating the impact of this pronouncement on our
consolidated financial statements.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to
Income Tax Disclosures. This ASU is intended to improve income tax disclosures, specifically requiring
disaggregated information about a reporting entity’s effective tax rate reconciliation and information on
income taxes paid. ASU 2023-09 will be effective for us for annual periods beginning with our fiscal year
ending January 31, 2026. Early adoption is permitted. We are currently evaluating the impact of this
pronouncement on our consolidated financial statements.
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
We are exposed to certain market risks in the ordinary course of our business. Market risk represents
the risk of loss that may impact our financial position due to adverse changes in financial market prices
and rates. Our market risk exposure is primarily a result of fluctuations in foreign currency exchange rates
and interest rates.
Foreign Currency Exchange Risk
Our sales contracts are denominated predominantly in U.S. Dollars, Euros (EUR), British Pounds
(GBP), and Japanese Yen (JPY). A portion of our operating expenses are incurred outside the United
States and denominated in foreign currencies and are subject to fluctuations due to changes in foreign
currency exchange rates, particularly changes in the GBP, Chinese Yuan (CNY), and Indian Rupee (INR).
Additionally, fluctuations in foreign currency exchange rates may cause us to recognize transaction gains
and losses in our consolidated statement of comprehensive loss. The effect of a hypothetical 10% change
in foreign currency exchange rates applicable to our business would not have a material impact on our
historical consolidated financial statements for the fiscal years ended January 31, 2024 and 2023. Given
the impact of foreign currency exchange rates has not been material to our historical operating results, we
have not entered into derivative or hedging transactions, but we may do so in the future if our exposure to
foreign currency should become more significant. As our international operations grow, we will continue to
reassess our approach to manage our risk relating to fluctuations in currency rates.
Interest Rate Risk
We had cash and cash equivalents and short-term investments of $514.2 million as of January 31,
2024. Our cash and cash equivalents and short-term investments are held for working capital purposes.
We do not make investments for trading or speculative purposes. A significant decrease in these market
rates may adversely affect our expected operating results. The 2029 Notes have a fixed interest rate and
therefore are not impacted by market rates.
Our cash equivalents and short-term investments are subject to market risk due to changes in
interest rates. Fixed rate securities may have their market value adversely affected due to a rise in
interest rates. Due in part to these factors, our future investment income may fall short of our expectations
due to changes in interest rates or we may suffer losses in principal if we are forced to sell securities that
decline in market value due to changes in interest rates. However, because we classify our short-term
investments as ‘‘available-for-sale,’’ no gains or losses are recognized due to changes in interest rates
unless such securities are sold prior to maturity or decreases in fair value are determined to be
other-than-temporary.
70

As of January 31, 2024, a hypothetical 10% relative change in interest rates would not have had a
material impact on the value of our cash equivalents and short-term investments or interest owed on our
outstanding debt. Fluctuations in the value of our cash equivalents and short-term investments caused by
a change in interest rates (gains or losses on the carrying value) are recorded in other comprehensive
income, and are realized only if we sell the underlying securities prior to maturity. In addition, a
hypothetical 10% relative change in interest rates would not have had a material impact on our operating
results for fiscal 2024.
71

Item 8.
Financial Statements and Supplementary Data
Index To Consolidated Financial Statements
Page
Report of Independent Registered Public Accounting Firm (PCAOB ID 185) . . . . . . . . . . . . . . . . . . . .
73
Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
75
Consolidated Statements of Comprehensive Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
76
Consolidated Statements of Stockholders’ Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
77
Consolidated Statements of Cash Flows. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
78
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
80
72

Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
Zuora, Inc.:
Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
We have audited the accompanying consolidated balance sheets of Zuora, Inc. and subsidiaries (the
Company) as of January 31, 2024 and 2023, the related consolidated statements of comprehensive loss,
stockholders’ equity, and cash flows for each of the years in the three-year period ended January 31,
2024, and the related notes (collectively, the consolidated financial statements). We also have audited the
Company’s internal control over financial reporting as of January 31, 2024, based on criteria established
in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations
of the Treadway Commission.
In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position of the Company as of January 31, 2024 and 2023, and the results of its
operations and its cash flows for each of the years in the three-year period ended January 31, 2024, in
conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company
maintained, in all material respects, effective internal control over financial reporting as of January 31,
2024 based on criteria established in Internal Control – Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining
effective internal control over financial reporting, and for its assessment of the effectiveness of internal
control over financial reporting, included in the accompanying Management’s Report on Internal Control
Over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated
financial statements and an opinion on the Company’s internal control over financial reporting based on
our audits. We are a public accounting firm registered with the Public Company Accounting Oversight
Board (United States) (PCAOB) and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities
and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that
we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement, whether due to error or fraud, and whether effective internal
control over financial reporting was maintained in all material respects.
Our audit of the consolidated financial statements included performing procedures to assess the risks of
material misstatement of the consolidated financial statements, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also
included evaluating the accounting principles used and significant estimates made by management, as
well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal
control over financial reporting included obtaining an understanding of internal control over financial
reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk. Our audits also included
performing such other procedures as we considered necessary in the circumstances. We believe that our
audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A company’s internal
control over financial reporting includes those policies and procedures that (1) pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the
73

assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted accounting principles,
and that receipts and expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (3) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the
consolidated financial statements that was communicated or required to be communicated to the audit
committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial
statements and (2) involved our especially challenging, subjective, or complex judgments. The
communication of a critical audit matter does not alter in any way our opinion on the consolidated financial
statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing
a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
As discussed in Note 2 to the consolidated financial statements, the Company’s total revenue was
$431.7 million for the year ended January 31, 2024. The Company derives revenue from subscription
fees and professional services fees. Subscription revenue is generally recognized ratably over the
contract term beginning on the commencement date of each contract, which is the date the cloud-based
software is made available to customers. Revenue for the Company’s professional services is recognized
as services are performed, generally on a time and materials basis. Most customer contracts are subject
to standard terms and conditions; however, certain contracts contain non-standard terms that may impact
revenue recognition.
We identified the evaluation of revenue from arrangements with non-standard terms and conditions as a
critical audit matter. The Company’s accounting is dependent on the identification and evaluation of the
terms used to calculate revenue. Significant auditor judgement was required to evaluate the Company’s
identification and evaluation of non-standard terms and conditions in new and modified contracts.
Furthermore, certain non-standard terms and conditions required judgment to assess the impact on
revenue recognition.
The following are the primary procedures we performed to address this critical audit matter. We applied
auditor judgment to determine the nature and extent of procedures to be performed over the identification
and evaluation of the non-standard contract terms. We evaluated the design and tested the operating
effectiveness of certain internal controls over the Company’s revenue recognition process, including those
specifically related to the identification and evaluation of non-standard contract terms. For a selection of
new and modified contracts, we evaluated whether management appropriately identified and considered
terms within those contracts which affect revenue recognition.
/s/ KPMG LLP
We have served as the Company’s auditor since 2011.
Santa Clara, California
March 26, 2024
74

ZUORA, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
January 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 256,065
$ 203,239
Short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
258,120
183,006
Accounts receivable, net of allowance for credit losses of $2,142 and $4,001
as of January 31, 2024 and January 31, 2023, respectively . . . . . . . . . . . . . . . .
124,602
91,740
Deferred commissions, current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15,870
16,282
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
23,261
24,285
Total current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
677,918
518,552
Property and equipment, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25,961
27,159
Operating lease right-of-use assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
22,462
22,768
Purchased intangibles, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,082
13,201
Deferred commissions, net of current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
27,250
28,250
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
56,657
53,991
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,506
4,677
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 823,836
$ 668,598
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
3,161
$
1,073
Accrued expenses and other current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
32,157
103,678
Accrued employee liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
37,722
30,483
Deferred revenue, current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
199,615
167,145
Operating lease liabilities, current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,760
9,240
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
279,415
311,619
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
359,525
210,403
Deferred revenue, net of current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,802
442
Operating lease liabilities, net of current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
37,100
37,924
Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,725
3,717
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,582
7,333
Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
690,149
571,438
Commitments and contingencies (Note 13)
Stockholders’ equity:
Class A common stock - $0.0001 par value; 500,000 shares authorized,
137,792 and 127,384 shares issued and outstanding as of January 31, 2024
and 2023, respectively.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14
13
Class B common stock - $0.0001 par value; 500,000 shares authorized, 8,240
and 8,121 shares issued and outstanding as of January 31, 2024 and 2023,
respectively. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1
1
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
964,141
859,482
Accumulated other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(859)
(919)
Accumulated deficit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(829,610)
(761,417)
Total stockholders’ equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
133,687
97,160
Total liabilities and stockholders’ equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 823,836
$ 668,598
75
See notes to consolidated financial statements.

ZUORA, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands, except per share data)
Fiscal Year Ended January 31,
2024
2023
2022
Revenue:
Subscription . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$383,396
$ 338,391
$ 287,747
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48,265
57,696
58,991
Total revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
431,661
396,087
346,738
Cost of revenue:
Subscription . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
84,599
81,094
68,285
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
62,375
72,135
71,821
Total cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
146,974
153,229
140,106
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
284,687
242,858
206,632
Operating expenses:
Research and development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108,288
102,564
83,219
Sales and marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
166,215
173,871
143,366
General and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
74,591
78,878
76,223
Litigation settlement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
75,000
—
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
349,094
430,313
302,808
Loss from operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(64,407)
(187,455)
(96,176)
Change in fair value of debt conversion and warrant liabilities . . . . . . . .
(2,234)
9,214
—
Interest expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(21,480)
(15,133)
(152)
Interest and other income (expense), net . . . . . . . . . . . . . . . . . . . . . . . . . .
22,079
5,986
(1,670)
Loss before income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(66,042)
(187,388)
(97,998)
Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,151
10,582
1,427
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(68,193)
(197,970)
(99,425)
Comprehensive loss:
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . .
(672)
(461)
(673)
Unrealized gain (loss) on available-for-sale securities . . . . . . . . . . . . .
732
(350)
(231)
Comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (68,133) $(198,781) $(100,329)
Net loss per share, basic and diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(0.49) $
(1.51) $
(0.80)
Weighted-average shares outstanding used in calculating net loss per
share, basic and diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
140,147
131,441
124,206
76
See notes to consolidated financial statements.

ZUORA, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in thousands)
Class A
Common Stock
Class B
Common Stock
Additional
Paid-in
Capital
Accumulated
Other
Comprehensive
Income (Loss)
Accumulated
Deficit
Total
Stockholders’
Equity
Shares
Amount Shares Amount
Balance, January 31, 2021 . . . . . 109,900
$11
11,004
$ 1
$635,127
$ 796
$(464,022)
$ 171,913
Conversion of Class B
common stock to Class A
common stock . . . . . . . . . .
4,371
—
(4,371)
—
—
—
—
—
Issuance of common stock
upon exercise of stock
options. . . . . . . . . . . . . . . .
509
1
2,389
—
18,498
—
—
18,499
Lapse of restrictions on
common stock related to
early exercise of stock
options. . . . . . . . . . . . . . . .
—
—
—
—
26
—
—
26
RSU releases. . . . . . . . . . . . .
3,462
—
26
—
—
—
—
—
Issuance of common stock
under the ESPP . . . . . . . . .
705
—
—
—
7,428
—
—
7,428
Charitable donation of stock . .
61
—
—
—
1,000
1,000
Stock-based compensation. . .
—
—
—
—
72,070
—
—
72,070
Other comprehensive loss . . .
—
—
—
—
—
(904)
—
(904)
Net loss . . . . . . . . . . . . . . . . .
—
—
—
—
—
—
(99,425)
(99,425)
Balance, January 31, 2022 . . . . . 119,008
$12
9,048
$ 1
$734,149
$(108)
$(563,447)
$ 170,607
Conversion of Class B
common stock to Class A
common stock . . . . . . . . . .
1,355
—
(1,355)
—
—
—
—
—
Issuance of common stock
upon exercise of stock
options. . . . . . . . . . . . . . . .
49
—
428
—
2,471
—
—
2,471
RSU releases. . . . . . . . . . . . .
5,795
1
—
—
—
—
—
1
Issuance of common stock
under the ESPP . . . . . . . . .
1,076
—
—
—
7,019
—
—
7,019
Charitable donation of stock . .
101
—
—
—
1,000
—
—
1,000
Stock-based compensation. . .
—
—
—
—
96,401
—
—
96,401
Issuance of warrants . . . . . . .
—
—
—
—
18,442
—
—
18,442
Other comprehensive loss . . .
—
—
—
—
—
(811)
—
(811)
Net loss . . . . . . . . . . . . . . . . .
—
—
—
—
—
—
(197,970)
(197,970)
Balance, January 31, 2023 . . . . . 127,384
$13
8,121
$ 1
$859,482
$(919)
$(761,417)
$
97,160
Conversion of Class B
common stock to Class A
common stock . . . . . . . . . .
515
—
(515)
—
—
—
—
—
Issuance of common stock
upon exercise of stock
options. . . . . . . . . . . . . . . .
—
1
634
—
2,279
—
—
2,280
RSU and PSU releases . . . . .
8,295
—
—
—
—
—
—
—
Issuance of common stock
under the ESPP . . . . . . . . .
1,598
—
—
—
8,401
—
—
8,401
Stock-based compensation. . .
—
—
—
—
101,052
—
—
101,052
Reclassification of warrants to
liability, net of allocated
debt issuance costs, to
Accrued expenses and
other current liabilities. . . . .
—
—
—
—
(7,073)
—
—
(7,073)
Other comprehensive income .
—
—
—
—
—
60
—
60
Net loss . . . . . . . . . . . . . . . . .
—
—
—
—
—
—
(68,193)
(68,193)
Balance, January 31, 2024 . . . . . 137,792
$14
8,240
$ 1
$964,141
$(859)
$(829,610)
$ 133,687
77
See notes to consolidated financial statements.

ZUORA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Fiscal Year Ended January 31,
2024
2023
2022
Cash flows from operating activities:
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (68,193) $(197,970) $ (99,425)
Adjustments to reconcile net loss to net cash (used in) provided
by operating activities:
Depreciation, amortization and accretion . . . . . . . . . . . . . . . . . . . .
18,214
18,738
16,760
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
101,052
96,401
72,070
Provision for credit losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
858
2,245
2,919
Donation of common stock to charitable foundation . . . . . . . . . . .
—
1,000
1,000
Amortization of deferred commissions. . . . . . . . . . . . . . . . . . . . . . .
18,959
19,291
16,330
Reduction in carrying amount of right-of-use assets. . . . . . . . . . .
6,090
7,363
9,717
Asset impairment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,811
4,537
12,783
Change in fair value of debt conversion and warrant liabilities . .
2,234
(9,213)
—
Change in fair value of contingent consideration. . . . . . . . . . . . . .
—
(380)
—
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,335
(391)
802
Changes in operating assets and liabilities:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(34,230)
(11,081)
(6,322)
Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . . . . .
885
(7,379)
(1,179)
Deferred commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(18,051)
(22,802)
(24,127)
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,082
(6,084)
4,457
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . . .
(82,746)
88,353
1,424
Accrued employee liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,239
(2,161)
1,165
Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
34,830
12,020
24,281
Operating lease liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(13,136)
(13,131)
(13,969)
Net cash (used in) provided by operating activities. . . . . . . . . .
(18,767)
(20,644)
18,686
Cash flows from investing activities:
Purchases of property and equipment. . . . . . . . . . . . . . . . . . . . . . . . .
(9,987)
(10,634)
(8,776)
Insurance proceeds for damaged property and equipment . . . . . . .
—
—
344
Purchase of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
—
(1,349)
Purchases of short-term investments . . . . . . . . . . . . . . . . . . . . . . . . .
(286,394)
(234,246)
(109,510)
Maturities of short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . .
216,628
154,806
99,192
Cash paid for acquisition, net of cash acquired . . . . . . . . . . . . . . . . .
(4,524)
(41,000)
—
Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . .
(84,277)
(131,074)
(20,099)
Cash flows from financing activities:
Proceeds from issuance of convertible senior notes, net of
issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
145,861
233,901
—
Proceeds from issuance of common stock upon exercise of stock
options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,280
2,471
18,499
Proceeds from issuance of common stock under employee stock
purchase plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,401
7,019
7,428
Principal payments on debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
(1,480)
(4,444)
Net cash provided by financing activities . . . . . . . . . . . . . . . . . .
156,542
241,911
21,483
Effect of exchange rates on cash and cash equivalents. . . . . . . . . . . .
(672)
(461)
(673)
Net increase in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . .
52,826
89,732
19,397
Cash and cash equivalents, beginning of year . . . . . . . . . . . . . . . . . . .
203,239
113,507
94,110
Cash and cash equivalents, end of year . . . . . . . . . . . . . . . . . . . . . . . . .
$ 256,065
$ 203,239
$ 113,507
78
See notes to consolidated financial statements.

Fiscal Year Ended January 31,
2024
2023
2022
Supplemental disclosure of cash flow information:
Cash paid for interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$11,504
$7,608
$
94
Cash paid for tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 1,993
$1,445
$1,395
Supplemental disclosure of non-cash investing and financing
activities:
Lapse in restrictions on early exercised common stock options . . .
$
—
$
—
$
26
Property and equipment purchases accrued or in accounts
payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
6
$
4
$
164
Purchase of intangible assets included in accrued expenses and
other current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
—
$
—
$
225
79
See notes to consolidated financial statements.

ZUORA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Overview and Basis of Presentation
Description of Business
Zuora, Inc. was incorporated in the state of Delaware in 2006 and began operations in 2007. Zuora’s
fiscal year ends on January 31. Zuora is headquartered in Redwood City, California.
Zuora provides a leading monetization suite for modern businesses, built to help companies launch
and scale new services and operate dynamic, customer-centric business models. Our technology
solutions enable companies across multiple industries and geographies to build, run, and grow a modern,
subscription business, automating the quote-to-revenue process, including offers, billing, collections, and
revenue recognition. With Zuora’s solutions, businesses can change and evolve how they go to market
through a mix of monetization models, efficiently comply with revenue recognition standards, analyze
customer data to optimize their offerings, and build recurring relationships with their customers.
References to ‘‘Zuora’’, ‘‘us’’, ‘‘our’’, or ‘‘we’’ in these notes refer to Zuora, Inc. and its subsidiaries on
a consolidated basis.
Basis of Presentation and Principles of Consolidation
The accompanying consolidated financial statements, which include the accounts of Zuora and its
wholly owned subsidiaries, have been prepared in conformity with accounting principles generally
accepted in the United States of America (GAAP). All intercompany balances and transactions have been
eliminated in consolidation.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management
to make certain estimates and assumptions. These estimates and assumptions affect the reported
amounts of assets and liabilities at the date of the consolidated financial statements, as well as reported
amounts of revenue and expenses during the reporting period. Actual results could differ materially from
those estimates.
Our most significant estimates and assumptions are related to revenue recognition with respect to
the determination of the standalone selling prices for our services; the expected period of benefit over
which deferred commissions are amortized; valuation of our convertible senior notes and warrants and
short-term investments; estimates of allowance for credit losses; estimates of the fair value of goodwill
and long-lived assets when evaluating for impairments and for assets acquired from acquisitions; useful
lives of intangibles and other long-lived assets; and the valuation of deferred income tax assets and
contingencies. We base our estimates on historical experience and on various other assumptions that are
believed to be reasonable under the circumstances. Accordingly, actual results may differ materially from
these estimates under different assumptions or conditions.
Foreign Currency
The functional currencies of our foreign subsidiaries are the respective local currencies. Translation
adjustments arising from the use of differing exchange rates from period to period are included in
accumulated other comprehensive loss within our consolidated balance sheets. Foreign currency
transaction gains and losses are included in Interest and other income (expense), net in the consolidated
statements of comprehensive loss and were not material for fiscal 2024, 2023 and 2022. All assets and
liabilities denominated in a foreign currency are translated into U.S. dollars at the exchange rate on the
balance sheet date. Revenue and expenses are translated at the average exchange rate during the
period, and equity balances are translated using historical exchange rates.
Segment Information
We operate as one operating segment. Our chief operating decision maker is our Chief Executive
Officer, who primarily reviews financial information presented on a consolidated basis for purposes of
making operating decisions, assessing financial performance, and allocating resources.
80

Note 2. Summary of Significant Accounting Policies and Recent Accounting Pronouncements
Revenue Recognition Policy
We generate revenue primarily from two sources: (1) subscription services, which is comprised of
revenue from subscription fees from customers accessing our cloud-based software; and (2) professional
services and other revenue. For the fiscal year ended January 31, 2024, subscription revenue was
$383.4 million and professional services and other revenue was $48.3 million.
Revenue is recognized upon satisfaction of performance obligations in an amount that reflects the
consideration we expect to receive in exchange for those products or services.
We determine the amount of revenue to be recognized through application of the following steps:
○
Identification of the contract, or contracts with a customer;
○
Identification of the performance obligations in the contract;
○
Determination of the transaction price;
○
Allocation of the transaction price to the performance obligations in the contract; and
○
Recognition of revenue when or as we satisfy the performance obligations.
Our subscription service arrangements are typically non-cancelable for a pre-specified subscription
term and do not typically contain refund-type provisions. Certain arrangements contain non-standard
terms and conditions that may impact our revenue recognition for those arrangements.
Subscription Services
Subscription services revenue is primarily comprised of fees that provide customers with access to
our cloud-based software during the term of the arrangement. Cloud-based services typically allow our
customers to use our multi-tenant software without taking possession of the software. Revenue is
generally recognized ratably over the contract term beginning on the commencement date of each
contract, which is the date our cloud-based software is made available to customers. We generally
invoice for subscription services annually, semi-annually, or quarterly in advance of services being
performed.
Subscription agreements generally have terms ranging from one to five years. Amounts that have
been invoiced are recorded in accounts receivable and in either deferred revenue or revenue in our
consolidated financial statements, depending on whether the underlying performance obligation has been
satisfied.
Professional Services and Other Revenue
Professional services revenue consists of fees for services related to helping our customers deploy,
configure, and optimize the use of our solutions. These services include system integration, data
migration, and process enhancement. Professional services projects generally take three to twelve
months to complete. Once the contract is signed, we generally invoice for professional services on a time
and materials basis, although we occasionally engage in fixed-price service engagements and invoice for
those based upon agreed milestone payments. We recognize revenue as services are performed for time
and materials engagements and on a proportional performance method as the services are performed for
fixed fee engagements.
Contracts with Multiple Performance Obligations
We enter into contracts with our customers that often include cloud-based software subscriptions and
professional services performance obligations. A performance obligation is a commitment in a contract
with a customer to transfer products or services that are distinct. Determining whether products and
services are distinct performance obligations that should be accounted for separately or combined as one
unit of accounting may require judgment.
Our cloud-based software subscriptions are distinct as such services are often sold separately. In
addition, our subscription services contracts can include multi-year agreements that include a fixed
81

annual platform fee and a volume block usage fee that may vary based on permitted volume usage each
year. To the extent that permitted volume usage each year is the same, we have concluded that there is
one multi-year stand-ready performance obligation. To the extent that permitted volume usage each year
varies, we have concluded that each year represents a distinct stand-ready performance obligation and
we allocate the transaction price to the performance obligations on a relative standalone-selling price
basis and revenue is recognized ratably over each year.
We consider the following factors for each professional services agreement: availability of the
services from other vendors, the nature of the professional services, the timing of when the professional
services contract was signed in comparison to the cloud-based software, start date and the contractual
dependence of the cloud-based software on the customer’s satisfaction with the professional services
work. To date, we have concluded that all of the professional services included in contracts with multiple
performance obligations are distinct.
We allocate the transaction price to each performance obligation on a relative standalone selling
price (SSP) basis. The SSP is the estimated price at which we would sell a promised product or service
separately to a customer. Judgment is required to determine the SSP for each distinct performance
obligation.
We establish SSP for both our subscription services and professional services elements primarily by
considering the actual sales prices of the element when sold on a stand-alone basis or when sold
together with other elements. If we are unable to rely on actual observable standalone sales inputs, we
determine SSP based on other observable inputs such as actual sales prices when sold together with
other promised subscriptions or services and other factors such as our overarching pricing objectives and
strategies.
Deferred Commissions
We capitalize sales commission expenses and associated payroll taxes paid to internal sales
personnel that are incremental to obtaining customer contracts. These costs are deferred and then
amortized over the expected period of benefit, which is estimated to be five years for new customers.
Commissions for existing customer renewals are deferred and amortized over twelve months. We have
determined the period of benefit taking into consideration several factors including the expected
subscription term and expected renewals of our customer contracts, the duration of our relationships with
our customers, and the life of our technology. Amortization expense is included in Sales and marketing in
the accompanying consolidated statements of comprehensive loss.
Contract Assets
Subscription services revenue is generally recognized ratably over the contract term beginning on the
commencement date of each contract. A contract asset results when revenue recognition occurs in
advance of billing the customer. Contract assets are included in Prepaid expenses and other current
assets in our consolidated balance sheets. The total value of our contract assets was $1.4 million and
$1.3 million as of January 31, 2024 and 2023, respectively.
For further detail regarding our remaining performance obligations, please refer to Note 10. Deferred
Revenue and Performance Obligations.
Cost of Revenue
Cost of subscription revenue primarily consists of costs relating to the hosting of our cloud-based
solutions, including salaries and benefits of technical operations and support personnel, data
communications costs, allocated overhead and property and equipment depreciation, amortization of
internal-use software and purchased intangibles and the reduction in the carrying amount of right-of-use
(ROU) assets.
Cost of professional services revenue primarily consists of the costs of delivering implementation
services to customers of our cloud-based software platform, including salaries and benefits of
professional services personnel and fees for third-party resources used in the delivery of implementation
services.
82

Advertising Expense
Advertising costs are expensed as incurred. For the periods presented, advertising expense was not
material.
Concentrations of Credit Risk and Significant Clients and Suppliers
Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash
and cash equivalents, short-term investments and accounts receivable. We deposit our cash, cash
equivalents, and short-term investments primarily with one financial institution and, accordingly, such
deposits regularly exceed federally insured limits.
No single customer accounted for more than 10% of Zuora’s revenue or accounts receivable balance
in any of the periods presented.
Cash and Cash Equivalents
We consider all highly liquid investments with original or remaining maturities of three months or less
on the purchase date to be cash equivalents. The carrying value of cash and cash equivalents
approximates fair value and consists primarily of bank deposits and money market funds.
Short-term Investments
We typically invest in high quality, investment grade securities from diverse issuers. We classify our
short-term investments as available-for-sale. In general, these investments are free of trading restrictions.
We carry these investments at fair value, based on quoted market prices or other readily available market
information. Unrealized gains and losses, net of taxes, are included in accumulated other comprehensive
loss, which is reflected as a separate component of stockholders’ equity in our consolidated balance
sheets. Gains and losses are recognized when realized in our consolidated statements of comprehensive
loss. When we have determined that an other-than-temporary decline in fair value has occurred, the
amount of the decline that is related to a credit loss is recognized in income. Gains and losses are
determined using the specific identification method.
We review our debt securities classified as short-term investments on a regular basis to evaluate
whether or not any security has experienced an other-than-temporary decline in fair value. We consider
factors such as the length of time and extent to which the market value has been less than the cost, the
financial condition and near-term prospects of the issuer and our intent to sell, or whether it is more likely
than not it will be required to sell the investment before recovery of the investment’s amortized cost basis.
If we believe that an other-than-temporary decline exists in one of these securities, we will write down
these investments to fair value. The portion of the write-down related to credit loss would be recorded to
Interest and other income (expense), net in our consolidated statements of comprehensive loss. Any
portion not related to credit loss would be recorded to accumulated other comprehensive loss, which is
reflected as a separate component of stockholders’ equity in our consolidated balance sheets.
We may sell our short-term investments at any time, without significant penalty, for use in current
operations or for other purposes, even if they have not yet reached maturity. As a result, we have
classified our investments, including any securities with maturities beyond 12 months, as current assets in
the accompanying consolidated balance sheets.
Accounts Receivable
Our accounts receivable consists of client obligations due under normal trade terms, and are
reported at the principal amount outstanding, net of the allowance for credit losses. We maintain an
allowance for credit losses that is based upon historical loss patterns, the number of days that billings are
past due, and an evaluation of the potential risk of loss related to certain accounts with high collection
risk.
The allowance for credit losses consists of the following activity (in thousands):
83

Fiscal Year Ended January 31,
2024
2023
Allowance for credit losses, beginning balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 4,001
$ 3,188
Additions:
Charged to revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
858
2,245
Charged to deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1,542)
1,818
Deductions:
Write-offs to revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1,087)
(2,201)
Write-offs to deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(88)
(1,049)
Allowance for credit losses, ending balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 2,142
$ 4,001
Property and Equipment, Net
Property and equipment are stated at cost. Depreciation is calculated on a straight-line basis over the
estimated useful lives of the related assets, generally three to five years. Leasehold improvements are
depreciated over the shorter of their remaining related lease term or estimated useful life. When assets
are retired, the cost and accumulated depreciation are removed from their respective accounts, and any
gain or loss on such sale or disposal is reflected in operating expenses in the accompanying consolidated
statements of comprehensive loss.
Acquisitions
We assess acquisitions under ASC Topic 805, Business Combinations (ASC 805) to determine
whether a transaction represents the acquisition of assets or a business combination. Under this
guidance, we apply a two-step model. The first step involves a screening test where we evaluate whether
substantially all of the fair value of the gross assets acquired is concentrated in either a single asset or a
group of similar assets. If the screening test is met, we account for the set as an asset acquisition. If the
screening test is not met, we apply the second step of the model to determine if the set meets the
definition of a business based on the guidance in ASC 805. If the second step is met, the transaction is
treated as a business combination. If the second step is not met, it is treated as an asset acquisition.
A business combination is accounted for using the acquisition method of accounting. Under the
acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as
of the acquisition date. Any excess fair value of consideration transferred over the fair value of the net
assets acquired is recorded as goodwill. The allocation of the consideration requires management to
make significant estimates in determining the fair values of assets acquired and liabilities assumed,
especially with respect to intangible assets. These estimates can include, but are not limited to, the cash
flows that an asset is expected to generate in the future, the appropriate weighted average cost of capital,
and the cost savings related to the business combination. These estimates are inherently uncertain and
unpredictable. Contingent consideration incurred in connection with the business combination is recorded
at its fair value on the acquisition date and is remeasured through credits or charges to the consolidated
statements of comprehensive loss each subsequent reporting period and is classified as contingent
consideration in the consolidated balance sheet until the related contingencies are resolved.
Goodwill, Acquired Intangible Assets, Internal-Use Software and Web Site Development
Costs, and Impairment of Long-Lived Assets
Goodwill. Goodwill represents the excess purchase consideration of an acquired business over the
fair value of the net tangible and identifiable intangible assets. Goodwill is evaluated for impairment
annually on December 1, and whenever events or changes in circumstances indicate the carrying value
of goodwill may not be recoverable. Triggering events that may indicate impairment include, but are not
limited to, a significant adverse change in customer demand or business climate or a significant decrease
in expected cash flows. An impairment loss is recognized to the extent that the carrying amount exceeds
the reporting unit’s fair value, not to exceed the carrying amount of goodwill. We have the option to first
assess qualitative factors to determine whether events or circumstances indicate that it is more likely than
not that the fair value of a reporting unit is less than its carrying amount and determine whether further
84

action is needed. If, after assessing the totality of events or circumstances, we determine it is not more
likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the
quantitative impairment test is unnecessary. No impairment charges were recorded during fiscal 2024,
2023 or 2022.
Acquired Intangible Assets. Acquired intangible assets consist of developed technology, customer
relationships, and trade names resulting from Zuora’s acquisitions. Acquired intangible assets are
recorded at fair value on the date of acquisition and amortized over their estimated useful lives on a
straight-line basis.
Internal-Use Software and Web Site Development Costs. We capitalize costs related to developing
our suite of software solutions and our website when it is probable the expenditures will result in
significant new functionality. Costs incurred in the preliminary stages of development are expensed as
incurred. Once an application has reached the development stage, internal and external costs, if direct
and incremental, are capitalized until the software is substantially complete and ready for its intended use.
Capitalized costs are recorded as part of Property and equipment, net in our consolidated balance sheets.
Maintenance and training costs are expensed as incurred. Internal-use software is amortized on a
straight-line basis over its estimated useful life, which is generally three years.
Impairment of Long-Lived Assets. The carrying amounts of long-lived assets, including property and
equipment, capitalized internal-use software, acquired intangible assets, deferred commissions, and ROU
assets, are reviewed for impairment whenever events or changes in circumstances indicate that the
carrying value of these assets may not be recoverable or that the useful life is shorter than originally
estimated. Recoverability of assets to be held and used is measured by comparing the carrying amount of
an asset to future undiscounted net cash flows the asset is expected to generate over its remaining life. If
the asset is determined to be impaired, the amount of any impairment recognized is measured as the
difference between the carrying value and the fair value of the impaired asset. If the useful life is shorter
than originally estimated, we amortize the remaining carrying value over the new shorter useful life.
During fiscal 2024, we recognized impairment charges totaling $3.8 million related to certain excess office
space that we have marketed for sublease, capitalized internal-use software, and purchased intangible
assets. During fiscal 2023 and fiscal 2022, we recognized $4.5 million and $12.8 million, respectively,
related to certain excess office spaces that we had marketed for sublease. See Note 12. Leases, Note 6.
Property and Equipment, Net, and Note 7. Intangible Assets and Goodwill for further details of these
charges.
Income Taxes
We use the asset-and-liability method of accounting for income taxes. Under this method, we
recognize deferred tax assets and liabilities for the expected future tax consequences of temporary
differences between the financial reporting and tax basis of assets and liabilities, as well as for operating
loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates
that are expected to apply to taxable income for the years in which those tax assets and liabilities are
expected to be realized or settled.
We record a valuation allowance to reduce our deferred tax assets to the net amount that we believe
is more likely than not to be realized. In assessing the need for a valuation allowance, we have
considered our historical levels of income, expectations of future taxable income and ongoing tax
planning strategies. Because of the uncertainty of the realization of the deferred tax assets in the U.S., we
have recorded a full valuation allowance against our deferred tax assets. Realization of our deferred tax
assets is dependent primarily upon future U.S. taxable income.
We recognize and measure tax benefits from uncertain tax positions using a two-step approach. The
first step is to evaluate the tax position taken or expected to be taken by determining if the weight of
available evidence indicates that it is more likely than not that the tax position will be sustained in an
audit, including resolution of any related appeals or litigation processes. The second step is to measure
the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement.
Significant judgment is required to evaluate uncertain tax positions.
Although we believe that we have adequately reserved for our uncertain tax positions, it can provide
no assurance that the final tax outcome of these matters will not be materially different. We evaluate our
85

uncertain tax positions on a regular basis and evaluations are based on a number of factors, including
changes in facts and circumstances, changes in tax law, correspondence with tax authorities during the
course of an audit and effective settlement of audit issues.
To the extent that the final tax outcome of these matters is different than the amounts recorded, such
differences will affect the provision for income taxes in the period in which such determination is made
and could have a material impact on our financial condition and results of operations. The provision for
income taxes includes the effects of any accruals that we believe are appropriate, as well as the related
net interest and penalties.
Stock-Based Compensation
We measure our employee and director stock-based compensation awards, including purchase
rights issued under the ESPP, based on the award’s estimated fair value on the date of grant. We
estimate the fair value of stock options, and purchase rights under the ESPP, using the Black-Scholes
option-pricing model. The fair value of restricted stock units (RSUs) and performance stock units (PSUs)
is equal to the fair value of our common stock on the date of grant.
Expense associated with our equity awards is recognized net of estimated forfeitures in our
consolidated statements of comprehensive loss using the straight-line attribution method over the
requisite service period for stock options and RSUs; over the period we expect the service and
performance conditions under the award will be achieved for PSUs; and over the offering period for the
purchase rights issued under the ESPP. Estimated forfeitures are based upon our historical experience
and we revise our estimates, if necessary, in subsequent periods if actual forfeitures differ from initial
estimates. For PSUs, we evaluate the vesting conditions on an ongoing basis and stop recognizing
expense when we deem the PSU is no longer probable of vesting. If we deem the PSU to be improbable
of vesting, we record an adjustment to reverse all previously recognized expense associated with the
PSU in the current period.
Stock options generally vest over four years and have a contractual term of ten years. ESPP
purchase rights vest over the two year offering period. RSUs generally vest over three to four years and
PSUs generally vest over one to three years.
Determining the grant date fair value of options, RSUs, and PSUs requires management to make
assumptions and judgments. These estimates involve inherent uncertainties and if different assumptions
had been used, stock-based compensation expense could have been materially different from the
amounts recorded.
The assumptions and estimates for valuing stock options are as follows:
•
Fair value per share of Company’s common stock. We use the publicly quoted price of our
common stock as reported on the New York Stock Exchange as the fair value of our common
stock.
•
Expected volatility. We determine the expected volatility based on historical average volatilities of
similar publicly traded companies corresponding to the expected term of the awards.
•
Expected term. We determine the expected term of awards which contain only service conditions
using the simplified approach, in which the expected term of an award is presumed to be the
mid-point between the vesting date and the expiration date of the award, as we do not have
sufficient historical data relating to stock-option exercises.
•
Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in
effect during the period the options were granted corresponding to the expected term of the
awards.
•
Estimated dividend yield. The estimated dividend yield is zero, as we do not currently intend to
declare dividends in the foreseeable future.
Net Loss per Share
Basic net loss per share is computed by dividing net loss by the weighted-average number of shares
of common stock outstanding during the period. Options subject to early exercise that are exercised prior
86

to vesting are excluded from the computation of weighted-average number of shares of common stock
outstanding until such shares have vested. Diluted net loss per share is computed by dividing net loss by
the weighted-average number of shares of common stock outstanding during the period increased by
giving effect to all potentially dilutive securities to the extent they are dilutive.
Leases
We determine if a contract is a lease or contains a lease at the inception of the contract and reassess
that conclusion if the contract is modified. All leases are assessed for classification as an operating lease
or a finance lease. Operating lease ROU assets are presented separately in our consolidated balance
sheets. Operating lease liabilities are also presented separately as current and non-current liabilities in
our consolidated balance sheets. We do not have any finance lease ROU assets or liabilities. ROU assets
represent our right to use an underlying asset for the lease term and lease liabilities represent our
obligation to make lease payments arising from the lease. We do not obtain and control our right to use
the identified asset until the lease commencement date.
Our lease liabilities are recognized at the applicable lease commencement date based on the present
value of the lease payments required to be paid over the lease term. When the rate implicit in the lease is
not readily determinable, we use the incremental borrowing rate to discount the lease payments to
present value. The estimated incremental borrowing rate is derived from information available at the lease
commencement date and factors in a hypothetical interest rate on a collateralized basis with similar
terms, payments and economic environments. Our ROU assets are also recognized at the applicable
lease commencement date. The ROU asset equals the carrying amount of the related lease liability,
adjusted for any lease payments made prior to lease commencement, minus any lease incentives
received, and any direct costs incurred by the lessee. Any variable lease payments are expensed as
incurred and do not factor into the measurement of the applicable ROU asset or lease liability.
The term of our leases equals the non-cancellable period of the lease, including any rent-free periods
provided by the lessor, and also includes options to renew or extend the lease (including by not
terminating the lease) that we are reasonably certain to exercise. We establish the term of each lease at
lease commencement and reassess that term in subsequent periods when one of the triggering events
outlined in Topic 842 occurs. Operating lease cost for lease payments is recognized on a straight-line
basis over the lease term.
Our lease contracts often include lease and non-lease components. We have elected the practical
expedient offered by the standard to not separate lease from non-lease components for our facilities
leases and account for them as a single lease component.
We have elected not to recognize ROU assets and lease liabilities for leases with a term of twelve
months or less. Lease cost for these short-term leases is recognized on a straight-line basis over the
lease term.
We have one sublease, which is classified as an operating lease. We recognize sublease income on
a straight-line basis over the sublease term. Sublease income is reported as a reduction in our operating
lease cost and is allocated across the consolidated statements of comprehensive loss.
Derivative Financial Instruments
The accounting treatment of derivative financial instruments requires that we record certain
embedded features and warrants as assets or liabilities at their fair value as of the inception date of the
agreement and at fair value as of each subsequent balance sheet date, with any change in fair value
recorded as income or expense. In connection with our issuance of the Initial Notes to Silver Lake on
March 24, 2022 as described in Note 9. Debt and Note 17. Warrants to Purchase Shares of Common
Stock, we adopted a sequencing policy in accordance with ASC 815-40, Accounting for Convertible
Instruments and Contracts in an Entity’s Own Equity, whereby financial instruments issued will be ordered
by conversion or exercise price.
Deferred Loan Costs
Costs directly associated with obtaining debt financing are deferred and amortized using the effective
interest rate method over the expected term of the related debt agreement. We determine the expected
87

term of debt agreements by assessing the contractual term of the debt as well as any non-contingent put
rights provided to the lenders. Unamortized amounts related to long-term debt are reflected on the
consolidated balance sheets as a direct deduction from the carrying amounts of the related long-term
debt liability. Amortization expense of deferred loan costs related to the 2029 Notes was approximately
$9.3 million and $6.6 million for fiscal 2024 and 2023, respectively, and is included in Interest expense on
the accompanying consolidated statements of comprehensive loss.
Earnings per Share
Basic earnings per share (EPS) is calculated by dividing the net income or loss available to common
stockholders by the weighted average number of shares of common stock outstanding for the period
without consideration for common stock equivalents. Diluted EPS is computed by dividing the net income
or loss available to common stockholders by the weighted average number of shares of common stock
outstanding for the period and the weighted average number of dilutive common stock equivalents
outstanding for the period determined using the if-converted method (convertible debt instruments) or
treasury-stock method (warrants and share-based payment arrangements). For purposes of this
calculation, common stock issuable upon conversion of debt, options and warrants are considered to be
common stock equivalents and are only included in the calculation of diluted earnings per share when
their effect is dilutive.
Recent Accounting Pronouncements—Adopted in Fiscal 2024
We did not adopt any new accounting pronouncements during the fiscal year ended January 31,
2024.
88

Note 3. Investments
The amortized costs, unrealized gains and losses and estimated fair values of our short-term
investments were as follows (in thousands):
January 31, 2024
Amortized Cost
Gross Unrealized
Gains
Gross Unrealized
Losses
Fair Value
U.S. government securities . . . . . . . . . . . . . . . . . . .
$ 98,206
$ 50
$ (7)
$ 98,249
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . .
129,767
121
(3)
129,885
Commercial paper . . . . . . . . . . . . . . . . . . . . . . . . . . .
29,991
—
(5)
29,986
Total short-term investments . . . . . . . . . . . . . . . .
$257,964
$171
$(15)
$258,120
January 31, 2023
Amortized Cost
Gross Unrealized
Gains
Gross Unrealized
Losses
Fair Value
U.S. government securities . . . . . . . . . . . . . . . . . . .
$ 34,865
$—
$(377)
$ 34,488
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . .
41,974
—
(189)
41,785
Commercial paper . . . . . . . . . . . . . . . . . . . . . . . . . . .
102,720
—
—
102,720
Foreign government securities . . . . . . . . . . . . . . . .
4,023
—
(10)
4,013
Total short-term investments . . . . . . . . . . . . . . . .
$183,582
$—
$(576)
$183,006
There were no material realized gains or losses from sales of marketable securities that were
reclassified out of accumulated other comprehensive loss into investment income during fiscal 2024 and
2023. We had no significant unrealized losses on our available-for-sale securities as of January 31, 2024
and January 31, 2023, and we do not expect material credit losses on our current investments in future
periods. All securities had stated effective maturities of less than one year as of January 31, 2024.
Note 4. Fair Value Measurements
The accounting guidance for fair value measurements establishes a three-tier hierarchy, which
prioritizes the inputs used in the valuation methodologies in measuring fair value as follows:
Levelinput
Input definition
Level 1
Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in
active markets
Level 2
Inputs other than quoted prices included within Level 1 that are observable for the asset or
liability through corroboration with market data at the measurement date
Level 3
Unobservable inputs that reflect management’s best estimate of what market participants
would use in pricing the asset or liability at the measurement date
In general, and where applicable, we use quoted prices in active markets for identical assets or
liabilities to determine fair value. If quoted prices in active markets for identical assets or liabilities are not
available to determine fair value, then we use quoted prices for similar assets and liabilities or inputs other
than the quoted prices that are observable either directly or indirectly.
89

The following tables summarize our fair value hierarchy for our financial assets measured at fair
value on a recurring basis (in thousands):
January 31, 2024
Level 1
Level 2
Level 3
Total
Cash equivalents:
Money market funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $207,632 $
— $
— $207,632
Corporate bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,497
—
—
3,497
Total cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
211,129
—
—
211,129
Short-term investments:
U.S. government securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $ 98,249 $
— $ 98,249
Corporate bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
129,885
—
129,885
Commercial paper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
29,986
—
29,986
Total short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $258,120 $
— $258,120
Liabilities:
Warrant liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $
— $11,992 $ 11,992
Debt conversion liability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
—
6,848
6,848
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $
— $18,840 $ 18,840
January 31, 2023
Level 1
Level 2
Level 3
Total
Cash equivalents:
Money market funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $184,580 $
— $
— $184,580
Short-term investments:
U.S. government securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $ 34,488 $
— $ 34,488
Corporate bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
41,785
—
41,785
Commercial paper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
102,720
—
102,720
Foreign government securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
4,013
—
4,013
Total short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $183,006 $
— $183,006
Liabilities:
Warrant liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $
— $2,829 $
2,829
Changes in our Level 3 fair value measurements were as follows (in thousands):
Warrant Liability
Balance, January 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 2,829
Reclassification of warrants from Additional paid-in-capital to Accrued expenses and
other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,717
Change in fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,446
Balance, January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$11,992
Additional information about the Warrant liability, including the fair value inputs, is included in
Note 17. Warrants to Purchase Shares of Common Stock.
Debt Conversion
Liability
Balance, January 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
—
Initial measurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,060
Change in fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
788
Balance, January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$6,848
90

Additional information about the debt conversion liability, including the fair value inputs, is included in
Note 9. Debt.
As of January 31, 2024, the net carrying amount of the 2029 Notes, defined in Note 9. Debt, was
$359.5 million and the estimated fair value was $300.2 million. The fair value of the 2029 Notes is
classified as a Level 3 measurement.
The carrying amounts of certain financial instruments, including cash held in bank accounts,
accounts receivable, accounts payable, and accrued expenses, approximate fair value due to their
relatively short maturities.
Our long- and indefinite-lived assets are measured at fair value on a non-recurring basis and are
reduced if the assets are determined to be impaired. During the fiscal years ended January 31, 2024,
January 31, 2023, and January 31, 2022, we recognized impairment charges of $2.2 million, $4.5 million,
and $12.8 million respectively, related to ROU assets, leasehold improvements, and furniture and fixtures
associated with certain of our operating leases for office spaces we have marketed for sublease. We
estimated the fair value of these assets when we identified indicators of impairment using a market
approach based on expected future cash flows from sublease income, which relied on certain
assumptions made by management based on both internal and external data. These assumptions
included estimates of the rental rate, discount rate, period of vacancy, incentives and annual rent
increases, which were determined based on recent market comparable data and other data regarding
general market conditions we reviewed in consultation with third-party commercial real estate experts.
See Note 12. Leases for further details on the impairment charges we recorded. As a result of the
subjective nature of unobservable inputs used, these assets are classified within Level 3 of the fair value
hierarchy. During the fiscal year ended January 31, 2024, we also recognized impairment charges of
$1.6 million related to certain capitalized software and intellectual property assets acquired in 2021.
Note 5. Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following (in thousands):
January 31,
2024
2023
Prepaid software subscriptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 6,582
$ 7,533
Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,348
3,860
Prepaid insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,305
3,225
Contract assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,380
1,325
Prepaid hosting costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,157
871
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
699
1,168
Insurance payments receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
2,000
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,790
4,303
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$23,261
$24,285
Note 6. Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
January 31,
2024
2023
Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 37,216
$ 32,778
Leasehold improvements1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14,013
15,254
Computer equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,125
11,780
Furniture and fixtures1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,276
3,793
66,630
63,605
Less: accumulated depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(40,669)
(36,446)
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 25,961
$ 27,159
(1)
The cost basis of leasehold improvements was reduced to reflect impairments of $0.6 million and $1.1 million, respectively,
91

recorded during the fiscal year ended January 31, 2024 and 2023. The cost basis of furniture and fixtures was reduced to
reflect an impairment of $0.1 million recorded during the fiscal year ended January 31, 2023. For more information, refer to
Note 12. Leases.
The following table summarizes the capitalized internal-use software costs included within the
Software line item in the table above (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Internal-use software costs capitalized during the period. . . . . . . . . . . . . . . . . .
$7,620
$7,066
$5,785
January 31,
2024
2023
Total capitalized internal-use software, net of accumulated amortization. . . . . . . . . . . .
$15,483
$14,138
During the fiscal year ended January 31, 2024, we recorded an impairment charge of $1.2 million
related to certain capitalized software which is included in Research and development in the
accompanying consolidated statements of comprehensive loss. No similar impairment charges were
recorded in the fiscal years ended 2023 or 2022.
The following table summarizes total depreciation and amortization expense related to property and
equipment, including amortization of internal-use software, included primarily in Cost of subscription
revenue and General and administrative in the accompanying consolidated statements of comprehensive
loss (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Total depreciation and amortization expense . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$9,229
$9,668
$11,430
Note 7. Intangible Assets and Goodwill
Intangible Assets
The following table summarizes the purchased intangible asset balances (in thousands):
January 31, 2024
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Developed technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$17,997
$ (9,782)
$ 8,215
Customer relationships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,187
(3,786)
1,401
Trade names . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,709
(1,243)
466
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$24,893
$(14,811)
$10,082
January 31, 2023
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Developed technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$19,571
$ (9,194)
$10,377
Customer relationships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,187
(3,225)
1,962
Trade names . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,709
(847)
862
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$26,467
$(13,266)
$13,201
During the fiscal year ended January 31, 2024, we recorded an impairment charge of $0.4 million
related to intellectual property assets acquired in 2021 which is included in Cost of subscription revenue
in the accompanying consolidated statements of comprehensive loss. No similar impairment charges
were recorded in the fiscal years ended January 31, 2023 or 2022.
Purchased intangible assets are being amortized primarily to Cost of subscription revenue in the
accompanying consolidated statements of comprehensive loss on a straight-line basis over their
estimated useful lives ranging from three to ten years. The following table summarizes amortization
expense recognized on purchased intangible assets during the periods indicated (in thousands):
92

Fiscal Year Ended January 31,
2024
2023
2022
Purchased intangible assets amortization expense. . . . . . . . . . . . . . . . . . . . . . .
$2,690
$2,251
$2,050
Estimated future amortization expense for purchased intangible assets as of January 31, 2024 was
as follows (in thousands):
Fiscal 2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 2,343
Fiscal 2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,874
Fiscal 2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,561
Fiscal 2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,561
Fiscal 2029 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,561
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,182
$10,082
Goodwill
The following table represents the changes to goodwill (in thousands):
Goodwill
Balance, January 31, 2022. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$17,632
Addition from acquisition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
35,009
Effects of foreign currency translation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,350
Balance, January 31, 2023. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
53,991
Effects of foreign currency translation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,156
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
510
Balance, January 31, 2024. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$56,657
There were no changes in the carrying amount of goodwill for the fiscal year ended January 31,
2022.
Zuora has one reporting unit. We performed an annual test for goodwill impairment as of
December 1, 2023 and determined that goodwill was not impaired as a result of our qualitative
assessment. In addition, there have been no significant events or circumstances affecting the valuation of
goodwill subsequent to our annual assessment.
Note 8. Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consisted of the following (in thousands):
January 31,
2024
2023
Warrant liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$11,992
$
2,829
Debt conversion liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,848
—
Accrued taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,147
4,088
Accrued hosting and third-party licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,707
4,374
Accrued outside services and consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,499
3,507
Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,344
850
Litigation settlement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
75,000
Accrued contingent consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
4,420
Other accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,620
8,610
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$32,157
$103,678
93

Note 9. Debt
2029 Notes
On March 24, 2022 (Initial Closing Date), we issued convertible senior notes (Initial Notes) in the
aggregate principal amount of $250.0 million pursuant to an agreement with certain entities affiliated with
Silver Lake Alpine II, L.P. (Silver Lake). On September 22, 2023 (Subsequent Closing Date), we issued
additional convertible senior notes in the aggregate principal amount of $150.0 million (Additional Notes
and together with the Initial Notes, the ‘‘2029 Notes’’) under the agreement with Silver Lake. The 2029
Notes represent senior unsecured obligations of Zuora.
As a condition of the agreement with Silver Lake, we also issued warrants to Silver Lake to acquire
up to 7.5 million shares of Class A common stock (Warrants) on the Initial Closing Date. Refer to Note 17.
Warrants to Purchase Shares of Common Stock for more information.
The purchase price of the 2029 Notes is 98% of the par value. The 2029 Notes bear interest at a rate
of 3.95% per annum, payable quarterly in cash, provided that we have the option to pay interest in kind at
5.50% per annum. The 2029 Notes will mature on March 31, 2029, subject to earlier conversion or
repurchase. The 2029 Notes are convertible at Silver Lake’s option into shares of our Class A common
stock at an initial conversion rate of 50.0 shares per $1,000 principal amount ($20.00 per share,
representing 20.0 million shares of Class A common stock), subject to customary anti-dilution
adjustments. Any 2029 Notes that are converted in connection with a ‘‘make-whole fundamental change’’
are subject to an increase in the conversion rate under certain circumstances. The term ‘‘make-whole
fundamental change’’ is defined in the indenture for the 2029 Notes, and generally refers to a
‘‘fundamental change’’ including a change in control of Zuora that meets certain specifications or the
termination of trading of Zuora’s stock on the New York Stock Exchange (or the NASDAQ Global Select
Market or the NASDAQ Global Market, or any of their respective successors), in each case subject to
certain exceptions and exclusions described in the indenture.
On the Initial Closing Date, we concluded that the conversion option contained in the 2029 Notes
qualified for a scope exception from derivative accounting under ASC 815-40, and therefore was not
bifurcated and accounted for separately from the Initial Notes. On the Subsequent Closing Date, we
reassessed the classification of the conversion option and concluded that a portion of the conversion
option no longer qualified for equity classification as a result of the issuance of the Additional Notes.
Under certain make-whole fundamental change scenarios, we would be required to, at our option, either
(i) seek and obtain stockholder approval prior to issuing 20% or more of our outstanding common stock or
voting power or (ii) pay cash in lieu of delivering any shares at or above such 20% threshold. As a result
of our sequencing policy described in Note 2. Summary of Significant Accounting Policies and Recent
Accounting Pronouncements, we separated a portion of the conversion option representing approximately
1.4 million shares of Class A common stock issuable upon conversion of the 2029 Notes valued at
$6.1 million as of the Subsequent Closing Date from the 2029 Notes and recorded a debt conversion
liability at fair value on bifurcation, with an offset to the carrying amount of the 2029 Notes. For further
information on our derivative financial instruments policy, refer to Note 2. Summary of Significant
Accounting Policies and Recent Accounting Pronouncements. We will reassess the classification of the
debt conversion liability in future reporting periods to determine if any further change is required.
With certain exceptions, upon a ‘‘fundamental change’’ of Zuora, the holders of the 2029 Notes may
require that we repurchase all or part of the principal amount of the 2029 Notes at a purchase price equal
to the principal amount and accrued but unpaid interest outstanding, plus the total sum of all remaining
scheduled interest payments through the remainder of the term of the 2029 Notes, at the 5.50% paid in
kind interest rate. At any time on or after March 24, 2027, the holders of the 2029 Notes may require that
we repurchase all or part of the principal amount of the Notes at a purchase price equal to the principal
amount plus accrued interest through the date of repurchase. Upon certain events of default, the 2029
Notes may be declared due and payable (or will automatically become so under certain events of default),
at a purchase price equal to the principal amount plus accrued interest through the date of repurchase.
We have no right to redeem the 2029 Notes prior to maturity.
We incurred $4.1 million of debt issuance costs associated with the issuance of the Additional Notes.
The original issue discount and the debt issuance costs (together, the ‘‘deferred loan costs’’) associated
94

with the 2029 Notes are being amortized to interest expense using the effective interest rate method over
the five year expected life of the 2029 Notes (representing the period from the contract date to the earliest
noncontingent put date of March 24, 2027) and reflects an effective interest rate of 7.6%.
The carrying value of the 2029 Notes was classified as long-term and consisted of the following
(in thousands):
January 31, 2024 January 31, 2023
Principal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$400,000
$250,000
Unamortized deferred loan costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(40,475)
(39,597)
Carrying value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$359,525
$210,403
Interest expense related to the 2029 Notes, included in Interest expense in the accompanying
consolidated statements of comprehensive loss, was as follows (in thousands):
Fiscal Year Ended January 31,
2024
2023
Contractual interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$11,999
$ 8,421
Amortization of deferred loan costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,321
6,644
Total interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$21,320
$15,065
We used a binomial lattice model to value the bifurcated derivatives contained in the 2029 Notes.
ASC 815 does not permit an issuer to account separately for individual derivative terms and features
embedded in hybrid financial instruments that require bifurcation and liability classification as derivative
financial instruments. Rather, such terms and features must be combined together, and fair-valued as a
single, compound embedded derivative. We selected a binomial lattice model to value the compound
embedded derivative because we believe this technique is reflective of all significant assumptions that
market participants would likely consider in negotiating the transfer of the 2029 Notes. Such assumptions
include, among other inputs, stock price volatility, risk-free rates, credit risk assumptions, early redemption
and conversion assumptions, and the potential for future adjustment of the conversion rate due to
triggering events. Additionally, there are other embedded features contained in the 2029 Notes requiring
bifurcation, other than the conversion option, which had no value as of January 31, 2024 and 2023 due to
management’s estimates of the likelihood of certain events, but that may have value in the future should
those estimates change.
The debt conversion liability’s fair value was measured using a binomial lattice model using the
following key inputs:
January 31, 2024 September 22, 2023
Fair value of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 9.14
$ 8.44
Conversion price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$20.00
$20.00
Expected volatility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
47.5%
47.5%
Risk-free interest rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.8%
4.5%
Corporate bond yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19.2%
20.5%
Coupon interest rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.95%
3.95%
We recognized a $0.8 million loss on the revaluation of the debt conversion liability, which is included
in Change in fair value of debt conversion and warrant liabilities in the accompanying consolidated
statements of comprehensive loss. Refer to Note 4. Fair Value Measurements for the fair value of the
debt conversion liability.
Debt Agreement
We have a $30.0 million revolving credit facility under an agreement with Silicon Valley Bank, a
division of First-Citizens Bank & Trust. This credit facility matures in October 2025. The interest rate under
the credit facility is equal to the prime rate published by the Wall Street Journal minus 1.0%. We had not
drawn down any amounts under the facility as of January 31, 2024.
95

Note 10. Deferred Revenue and Performance Obligations
Deferred revenue consists of customer billings in advance of revenue being recognized from our
subscription and support services and professional services arrangements. The change in total deferred
revenue for the year ended January 31, 2024 primarily includes increases resulting from additional billings
for contract ramps, upsells, renewals and new business contracts; and decreases resulting from revenue
recognized in the period. The following table summarizes revenue recognized during the period that was
included in the deferred revenue balance at the beginning of each respective period (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Revenue recognized from deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . $164,694 $147,036 $126,245
As of January 31, 2024, total remaining non-cancellable performance obligations under our
subscription contracts with customers was approximately $593.9 million and we expect to recognize
revenue on approximately 54% of these remaining performance obligations over the next 12 months.
Remaining performance obligations under our professional services contracts as of January 31, 2024
were not material.
Note 11. Geographical Information
Disaggregation of Revenue
Revenue by country, based on the customer’s address at the time of sale, was as follows (in
thousands):
Fiscal Year Ended January 31,
2024
2023
2022
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $275,711 $257,653 $218,502
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
155,950
138,434
128,236
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $431,661 $396,087 $346,738
Percentage of revenue by country:
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64%
65%
63%
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
36%
35%
37%
Other than the United States, no individual country exceeded 10% of total revenue for fiscal 2024,
2023 and 2022.
Long-lived assets
Long-lived assets, which consist of property and equipment, net, deferred commissions, purchased
intangible assets, net and operating lease right-of-use assets by geographic location, are based on the
location of the legal entity that owns the asset. As of January 31, 2024 and 2023, no individual country
exceeded 10% of total long-lived assets other than the United States.
Note 12. Leases
We have non-cancelable operating leases for our offices located in the U.S. and abroad. As of
January 31, 2024, these leases expire on various dates between 2024 and 2030. Certain lease
agreements include one or more options to renew, with renewal terms that can extend the lease up to
seven years. We have the right to exercise or forego the lease renewal options. The lease agreements do
not contain any material residual value guarantees or material restrictive covenants.
The components of our long-term operating leases and related operating lease cost were as follows
(in thousands):
January 31,
2024
2023
Operating lease right-of-use assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$22,462
$22,768
96

January 31,
2024
2023
Operating lease liabilities, current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 6,760
$ 9,240
Operating lease liabilities, net of current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
37,100
37,924
Total operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$43,860
$47,164
Fiscal Year Ended January 31,
2024
2023
2022
Operating lease cost1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $8,599 $9,933 $12,681
(1)
Includes costs related to our short-term operating leases and is net of sublease income as follows (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Short-term operating lease cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 535
$483
$402
Sublease income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(391)
$ (98)
$ —
The future maturities of long-term operating lease liabilities for each fiscal year were as follows
(in thousands):
Maturities of Operating
Lease Liabilities
2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 8,827
2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,770
2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,995
2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,911
2029 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,880
Thereafter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,607
Total lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50,990
Less imputed interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(7,130)
Present value of lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$43,860
Other supplemental information related to our long-term operating leases includes the following
(dollars in thousands):
January 31,
2024
2023
Weighted-average remaining operating lease term. . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.9 years
6.7 years
Weighted-average operating lease discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.1%
4.8%
Fiscal Year Ended January 31,
2024
2023
2022
Supplemental Cash Flow Information
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $13,559 $12,802 $13,701
Operating cash flows resulting from operating leases . . . . . . . . . . . . . . . . . . . . . . . $13,559 $12,802 $13,701
New right-of-use assets obtained in exchange for lease liabilities:
Operating leases obtained . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,400 $
799 $ 5,040
During the fiscal years ended January 31, 2024, 2023, and 2022, we identified indicators of
impairment for certain of our excess office spaces that we have marketed for sublease. In accordance
with ASC Topic 360, we evaluated the associated asset groups for impairment, which included the ROU
97

assets, leasehold improvements, and furniture and fixtures for each office space, as the change in
circumstances indicated that the carrying amount of the asset groups may not be recoverable. We
compared the expected future undiscounted cash flows for each office space to the carrying amount of
each respective asset group and determined that they were impaired.
We recognized the excess of the carrying value over the fair value of the asset groups as impairment
expense in the accompanying consolidated statements of comprehensive loss under General and
administrative. The impairment charges were allocated to the assets in the asset groups as shown in the
table below (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Right-of-use assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,620
$3,311
$ 9,769
Leasehold improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
599
1,150
2,223
Furniture and fixtures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
76
791
Total lease-related impairments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,219
$4,537
$12,783
Note 13. Commitments and Contingencies
Letters of Credit
In connection with the execution of certain facility leases, we had bank issued irrevocable letters of
credit for $4.5 million as of January 31, 2024, 2023 and 2022. No draws have been made under such
letters of credit.
Legal Proceedings
From time to time, we may be subject to legal proceedings, as well as demands, claims and
threatened litigation. The outcomes of legal proceedings and other contingencies are inherently
unpredictable, subject to significant uncertainties, and could be material to our operating results and cash
flows for a particular period. Regardless of the outcome, litigation can have an adverse impact on our
business because of defense and settlement costs, diversion of management resources, and other
factors. Other than the matters described below, we are not currently party to any legal proceeding that
we believe could have a material adverse effect on our business, operating results, cash flows, or
financial condition should such litigation or claim be resolved unfavorably.
Securities Class Action Litigation
In June 2019, a putative securities class action lawsuit alleging violations of the federal securities
laws was filed in the U.S. District Court for the Northern District of California naming Zuora and certain of
its officers as defendants, seeking unspecified compensatory damages, fees and costs. In
November 2019, the lead plaintiff filed a consolidated amended complaint asserting the same claims,
which was captioned Roberts v. Zuora, Inc., Case No. 3:19-CV-03422 (hereinafter referred to as ‘‘Federal
Class Action’’).
In April and May 2020, two putative securities class action lawsuits alleging violations of the federal
securities laws were filed and later consolidated in the Superior Court of the State of California, County of
San Mateo, naming as defendants Zuora and certain of its current and former officers, its directors and
the underwriters of Zuora’s initial public offering (IPO), and seeking unspecified damages and other relief.
In July 2020, the court entered an order consolidating the two lawsuits, and the lead plaintiffs filed a
consolidated amended complaint asserting the same claims. The consolidated class action litigation was
captioned Olsen v. Zuora, Inc., Case No. 20-civ-1918 (hereinafter referred to as ‘‘State Class Action’’).
In March 2023, Zuora entered into an agreement to settle the Federal Class Action without any
admission or concession of wrongdoing or liability by Zuora or the named defendants. In June 2023,
Zuora reached an agreement to settle the State Class Action without any admission or concession of
wrongdoing or liability by Zuora or the named defendants, and agreed to resolve the litigation as part of a
combined resolution with the Federal Class Action. In August 2023, the combined settlement of the
98

Federal Class Action and State Class Action received preliminary court approval, and Zuora paid an
aggregate of $75.5 million of which $7.2 million was funded by Zuora’s insurance proceeds. The
settlement received final court approval in January 2024.
Derivative Litigation
In September 2019, two stockholder derivative lawsuits were filed and later consolidated in the U.S.
District Court for the Northern District of California against certain of Zuora’s directors and executive
officers and naming Zuora as a nominal defendant. In May and June 2020, two additional stockholder
derivative lawsuits were filed and later consolidated in the U.S. District Court for the District of Delaware
against certain of Zuora’s directors and current and former executive officers. In February and
March 2021, two additional stockholder derivative lawsuits were filed and later consolidated in Delaware
Chancery Court alleging similar claims based on the same underlying events. These derivative actions
alleged claims based on events similar to those in the securities class actions and asserted causes of
action against the individual defendants for breach of fiduciary duty, unjust enrichment, waste of corporate
assets, and for alleged violation of federal securities laws.
In February 2023, Zuora reached an agreement to settle the derivative litigation matters without any
admission or concession of wrongdoing or liability by Zuora or the named defendants. In connection with
the settlement, Zuora agreed to adopt and implement certain corporate governance modifications and pay
$2.0 million for certain plaintiffs’ attorney fees, which amount was paid by Zuora’s insurance carriers in
August 2023. The settlement received final court approval in September 2023.
Other Contractual Obligations
As of January 31, 2024, we have a contractual obligations to make $10.1 million in purchases of
cloud computing services provided by one of our vendors by September 2024.
Note 14. Income Taxes
Net loss before provision for income taxes consisted of the following (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Domestic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(72,032) $(193,031) $(101,626)
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,990
5,643
3,628
Loss before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(66,042) $(187,388) $ (97,998)
The components of our income tax provision are as follows (in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Current:
Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
—
$
—
$
—
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
193
189
163
International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,912
10,332
799
$2,105
$10,521
$
962
Deferred:
Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
61
$
—
$
—
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
—
—
International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(40)
61
465
$
46
$
61
$
465
Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,151
$10,582
$1,427
99

A reconciliation of the U.S. federal statutory tax rate to our provision for income tax is as follows
(dollars in thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Federal income tax benefit at statutory rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(13,849) $(39,351) $(20,580)
State income taxes, net of effect of federal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(879)
(5,312)
(3,466)
Permanent differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
920
450
772
Warrant adjustment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
469
(1,935)
—
Federal and state R&D credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1,325)
(6,144)
(11,263)
Impact from international operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,480
9,230
502
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,990
7,772
(3,427)
Tax effects of intercompany transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
(7,204)
—
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1,512)
312
(1,174)
Change in valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,857
52,764
40,063
Income tax provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,151 $ 10,582 $
1,427
Deferred income taxes reflect the tax effects of temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
Our deferred income tax assets and liabilities consisted of the following (in thousands):
January 31,
2024
2023
Deferred tax assets:
Net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 147,259
$ 139,298
Tax credit carryforwards. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
28,581
27,256
Allowances and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17,743
34,884
Intangibles/Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,850
3,684
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,361
1,949
Operating lease liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,838
11,314
R&D Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
38,888
21,040
Total deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 249,520
$ 239,425
Deferred tax liabilities:
Deferred commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (11,528) $ (11,938)
Operating lease right-of-use asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5,678)
(5,368)
Total deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(17,206)
(17,306)
Valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(234,891)
(224,648)
Net deferred tax liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
(2,577) $
(2,529)
We have assessed, based on available evidence, both positive and negative, it is more likely than not
that the deferred tax assets will not be utilized, such that a valuation allowance has been recorded. The
valuation allowance increased by $10.2 million and $58.4 million, respectively, for fiscal 2024 and 2023.
As of January 31, 2024, we had U.S. federal and state net operating loss carryforwards of
approximately $552.3 million and $376.4 million, respectively, available to offset future taxable income. As
of January 31, 2023, we had U.S. federal and state net operating loss carryforwards of approximately
$523.5 million and $349.7 million, respectively, available to offset future taxable income. If not utilized,
these carryforward losses will expire in various amounts for federal and state tax purposes beginning in
2029. In addition, Zuora has approximately $324.0 million of federal net operating loss carryforwards that
arose after the 2017 tax year, which are available to reduce future federal taxable income, if any, over an
indefinite period. The utilization of those net operating loss carryforwards is limited to 80% of taxable
income in any given year.
100

We had approximately $24.9 million and $22.8 million of federal and state research and development
tax credits, respectively, available to offset future taxes as of January 31, 2024, and approximately
$20.5 million and $18.5 million of federal and state research and development tax credits, respectively,
available to offset future taxes as of January 31, 2023. If not utilized, the federal credits will begin to
expire in 2031. California state research and development tax credits may be carried forward indefinitely.
Utilization of the net operating loss and tax credit carryforwards may be subject to a substantial
annual limitation due to the ‘‘ownership change’’ limitations provided by Section 382 and 383 of the
Internal Revenue Code of 1986, as amended, and other similar state provisions. Any annual limitation
may result in the expiration of net operation loss and tax credit carryforwards before utilization.
The amount of accumulated foreign earnings of our foreign subsidiaries was immaterial as of
January 31, 2024. If our foreign earnings were repatriated, additional tax expense might result. Any
additional taxes associated with such repatriation would be immaterial.
We are required to inventory, evaluate, and measure all uncertain tax positions taken or to be taken
on tax returns and to record liabilities for the amount of such positions that may not be sustained, or may
only partially be sustained, upon examination by the relevant taxing authorities. Our total gross
unrecognized tax benefits, exclusive of interest and penalties described below, were $25.8 million and
$18.4 million as of January 31, 2024 and January 31, 2023, respectively. Because of our valuation
allowance position, $7.3 million of unrecognized tax benefits, if recognized, would reduce the effective tax
rate in a future period. We do not expect that the total amounts of unrecognized tax benefits will
significantly increase or decrease within twelve months of the reporting date.
A reconciliation of the beginning and ending amounts of uncertain tax position is as follows (in
thousands):
Fiscal Year Ended January 31,
2024
2023
2022
Gross amount of unrecognized tax benefits as of the beginning of the
period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $18,351 $10,228 $ 9,385
Increase for tax positions related to the current year . . . . . . . . . . . . . . . . . . . . .
4,474
8,247
2,603
Increase for tax positions related to prior years . . . . . . . . . . . . . . . . . . . . . . . . . .
3,005
—
1,135
Decrease for tax positions related to prior years . . . . . . . . . . . . . . . . . . . . . . . . .
(22)
(124)
(2,895)
Gross amount of unrecognized tax benefits as of the end of the period . . . . . $25,808 $18,351 $10,228
We file tax returns in the U.S. federal, and various state and foreign jurisdictions. All U.S. federal and
state jurisdictions’ tax years remain subject to examination by tax authorities due to the carryforward of
unused net operating losses and research and development credits. In addition, tax years starting from
2008 are subject to examination.
During fiscal 2024, 2023, and 2022, we recognized interest and penalties of $0.3 million, $0.1 million,
and $0.1 million, respectively, associated with unrecognized tax benefits in income tax expense.
Note 15. Stockholders’ Equity
Preferred Stock
As of January 31, 2024, we had authorized 10 million shares of preferred stock, each with a par
value of $0.0001 per share. As of January 31, 2024, no shares of preferred stock were issued and
outstanding.
Common Stock
Prior to Zuora’s IPO, all shares of common stock then outstanding were reclassified into Class B
common stock. Shares offered and sold in the IPO consisted of newly authorized shares of Class A
common stock. Holders of Class A and Class B common stock are entitled to one vote per share and ten
votes per share, respectively, and the shares of Class A common stock and Class B common stock are
identical, except for voting rights and the right to convert Class B shares to Class A shares.
101

As of January 31, 2024, Zuora had authorized 500 million shares of Class A common stock and
500 million shares of Class B common stock, each with a par value of $0.0001 per share. As of
January 31, 2024, 137.8 million shares of Class A common stock and 8.2 million shares of Class B
common stock were issued and outstanding.
Charitable Contributions
During fiscal 2023 and fiscal 2022, we donated 101,317 and 61,012 shares of our Class A common
stock, respectively, to a charitable donor-advised fund and recognized $1.0 million in both fiscal years as
a non-cash general and administrative expense in our consolidated statement of comprehensive loss. We
made no stock donations in fiscal 2024.
Accumulated Other Comprehensive Loss
Components of accumulated other comprehensive loss were as follows (in thousands):
Foreign Currency
Translation
Adjustment
Unrealized (Loss)
Gain on Available-for-
Sale Securities
Total
Balance, January 31, 2023. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
(343)
$(576)
$(919)
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . .
(672)
—
(672)
Unrealized gain on available-for-sale securities . . . . . . . . . . . . . .
—
732
732
Balance, January 31, 2024. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(1,015)
$ 156
$(859)
There were no material reclassifications out of accumulated other comprehensive loss during fiscal
2024. Additionally, there was no material tax impact on the amounts presented.
Note 16. Employee Stock Plans
Equity Incentive Plans
In March 2018, our Board of Directors adopted and our stockholders approved the 2018 Equity
Incentive Plan (2018 Plan). The 2018 Plan authorizes the award of stock options, restricted stock awards,
stock appreciation rights, restricted stock units (RSUs), performance awards, and stock bonuses. As of
January 31, 2024, approximately 25.0 million shares of Class A common stock were reserved and
available for issuance under the 2018 Plan. In addition, as of January 31, 2024, 3.5 million stock options
and RSUs exercisable or settleable for Class B common stock were outstanding in the aggregate under
our 2006 Stock Plan (2006 Plan) and 2015 Equity Incentive Plan (2015 Plan), which plans were
terminated in May 2015 and April 2018, respectively. The 2006 Plan and 2015 Plan continue to govern
outstanding equity awards granted thereunder.
Stock Options
The following table summarizes stock option activity and related information (in thousands, except
weighted-average exercise price, weighted-average grant date fair value and average remaining
contractual term):
Shares
Subject To
Outstanding
Stock Options
Weighted
Average
Exercise
Price
Average
Remaining
Contractual
Term (Years)
Aggregate
Intrinsic
Value
Balance as of January 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,761
$ 9.28
5.0
$14,505
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
—
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(634)
3.57
Cancelled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(776)
13.28
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(268)
12.92
Balance as of January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,083
9.21
3.6
15,984
Exercisable as of January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . .
3,528
4.61
2.2
15,984
Vested and expected to vest as of January 31, 2024 . . . . . . . . .
6,068
$ 9.20
3.6
$15,984
102

Fiscal Year Ended January 31,
2024(1)
2023
2022
Weighted-average grant date fair value per share of options granted during
each respective period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
N/A
$5.54
$6.54
Aggregate intrinsic value of options exercised during each respective
period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$3,713
$2,600
$32,179
(1)
No stock options were granted during the fiscal year ended January 31, 2024.
We used the Black-Scholes option-pricing model to estimate the fair value of our stock options
granted during each respective period using the following assumptions:
Fiscal Year Ended January 31,
2024(1)
2023
2022
Fair value of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
N/A
$12.52 $15.64 - $15.87
Expected volatility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
N/A
42.6%
42.3% - 42.7%
Expected term (in years) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
N/A
5.8
6.0 - 6.1
Risk-free interest rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
N/A
3.0%
1.0% - 1.1%
Expected dividend yield. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
N/A
—
—
(1)
No stock options were granted during the fiscal year ended January 31, 2024.
RSUs
The following table summarizes RSU activity and related information (in thousands except
weighted-average grant date fair value):
Number of RSUs
Outstanding
Weighted-
Average Grant
Date Fair Value
Balance as of January 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12,504
$12.98
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,074
8.24
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(7,955)
11.73
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1,937)
12.40
Balance as of January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,686
$10.24
Performance Stock Units (PSUs)
In March 2022, July 2023, and September 2023, we granted PSUs to certain executives under our
2018 Plan. Each grant is divided into two or three tranches, each tranche having pre-established
performance targets that if met, as determined quarterly by our Compensation Committee, would result in
the shares attributable to such tranche being earned, subject to a service-based vesting condition. The
shares attributable to unearned tranches will be forfeited on January 31, 2025, if the applicable
performance criteria for such tranches are not met. Stock-based compensation expense is recognized if it
is probable the performance targets (for each respective tranche) will be met during the performance
period. During the fiscal year ended January 31, 2023, we deemed all outstanding PSUs to be improbable
of vesting and we recorded an adjustment to reverse all $7.0 million of previously recognized expense
incurred during fiscal 2023. As we previously disclosed in our Form 10-Q for the three months ended
April 30, 2023 filed with the SEC on June 1, 2023, we modified the performance targets associated with
the PSUs that were granted in March 2022. This resulted in $9.6 million of incremental compensation
expense that is being recognized over the remaining vesting periods of the awards.
103

The following table summarizes PSU activity and related information (in thousands, except
weighted-average grant date fair value):
Number of PSUs
Outstanding
Weighted-
Average Grant
Date Fair Value
Balance as of January 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,905
$15.21
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
420
10.24
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(340)
15.21
Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(675)
15.21
Balance as of January 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,310
$14.31
2018 Employee Stock Purchase Plan
In March 2018, our Board of Directors adopted and our stockholders approved the 2018 Employee
Stock Purchase Plan (ESPP). This plan is broadly available to our employees in most of the countries in
which we operate. A total of 4.2 million shares of Class A common stock were reserved and available for
issuance under the ESPP as of January 31, 2024. The ESPP provides for 24-month offering periods
beginning June 15 and December 15 of each year, and each offering period contains four, six-month
purchase periods. On each purchase date, ESPP participants will purchase shares of our Class A
common stock at a price per share equal to 85% of the lesser of (1) the fair market value of the Class A
common stock on the offering date or (2) the fair market value of the Class A common stock on the
purchase date.
We estimated the fair value of ESPP purchase rights using a Black-Scholes option pricing model with
the following assumptions:
Fiscal Year Ended January 31,
2024
2023
2022
Fair value of common stock. . . . . . . . . . . . . . . . . . . . . . . .
$8.69 - $11.55
$6.15 - $8.91
$16.07 - $19.82
Expected volatility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
34.6% - 45.7%
42.4% - 52.3%
34.4% - 53.2%
Expected term (in years) . . . . . . . . . . . . . . . . . . . . . . . . . .
0.5 - 2.0
0.5 - 2.0
0.5 - 2.0
Risk-free interest rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.0% - 5.5%
2.3% - 4.7%
0.1% - 0.7%
Expected dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
—
—
Stock-based Compensation Expense
Stock-based compensation expense was recorded in the following cost and expense categories in
the accompanying consolidated statements of comprehensive loss (in thousands):
January 31,
2024
2023
2022
Cost of subscription revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
8,979 $ 8,141 $ 5,875
Cost of professional services revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,567
12,297
10,274
Research and development. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
27,292
25,819
21,072
Sales and marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
32,116
33,075
22,484
General and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
21,098
17,069
12,365
Total stock-based compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . $101,052 $96,401 $72,070
As of January 31, 2024, unrecognized compensation costs related to unvested equity awards and the
weighted-average remaining period over which those costs are expected to be realized were as follows
(dollars in thousands):
Stock Options
RSUs
PSUs
ESPP
Unrecognized compensation costs. . . . . . . . . . . . . . . . . . . . . . . . .
$1,605
$102,404
$18,590
$4,646
Weighted-average remaining recognition period . . . . . . . . . . . . .
1.0 years
1.7 years 1.1 years 0.7 years
104

Note 17. Warrants to Purchase Shares of Common Stock
In connection with the issuance of the 2029 Notes (discussed Note 9. Debt), we issued to Silver Lake
Warrants to acquire up to 7.5 million shares of Class A common stock, exercisable for a period of
approximately seven years from the Initial Closing Date, which are comprised of (i) Warrants to purchase
up to 2.5 million shares of Class A common stock are exercisable at $20.00 per share, (ii) Warrants to
purchase up to 2.5 million shares of Class A common stock are exercisable at $22.00 per share, and (iii)
Warrants to purchase up to 2.5 million shares of Class A common stock are exercisable at $24.00 per
share. In addition, Silver Lake can elect to exercise the Warrants on a net-exercise basis. In the event of a
‘‘make-whole fundamental change’’ (as defined in the Form of Warrant, which has a similar definition as in
the indenture, described above in Note 9. Debt), the number of shares issuable by Zuora upon exercise of
the Warrants may be increased, and the exercise price for the Warrants adjusted. As of January 31, 2024,
all 7.5 million Warrants were outstanding.
On the Initial Closing Date, we classified a portion of the Warrants as a current liability due to certain
settlement provisions in the Warrants. Under certain make-whole fundamental change scenarios, we
would be required to, at our option, either (i) obtain shareholder approval prior to issuing 20% or more of
our outstanding common stock or (ii) pay cash in lieu of delivering any shares at or above such 20%
threshold. As a result, we concluded that approximately 2.8 million Warrants valued at $12.0 million as of
the Initial Closing Date did not qualify for equity classification, pursuant to our sequencing policy under
ASC 815-40. As a result of the issuance of the Additional Notes, we reassessed the classification of the
Warrants and concluded that no Warrants qualified for equity classification under ASC 815-40.
Accordingly, we reclassified 4.7 million Warrants valued at $7.7 million from equity to liability as of the
Subsequent Closing Date. We will reassess the classification of the Warrant liability in future reporting
periods to determine if any change is required.
The liability-classified warrants’ fair value was measured using the Black-Scholes option pricing
model using the following inputs:
January 31, 2024
September 22, 2023
January 31, 2023
Fair value of common stock1. . . . . . . . . . . . . . . . . . . . . . .
$9.14
$8.44
$7.24
Exercise price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $20.00 - $24.00
$20.00 - $24.00 $22.00 - $24.00
Expected volatility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
41.8%
42.2%
41.2%
Expected term (in years) . . . . . . . . . . . . . . . . . . . . . . . . . .
5.2
5.5
6.2
Risk-free interest rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.9%
4.6%
3.6%
Expected dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
—
—
(1)
The fair value of common stock as of January 31, 2023 was adjusted to reflect certain restrictions on the Warrants. Such
restrictions expired in September 2023.
We recognized a $1.4 million loss and $9.2 million gain on the revaluation of the liability-classified
Warrants during the fiscal years ended January 31, 2024 and 2023, respectively, which are included in
Change in fair value of debt conversion and warrant liabilities in the accompanying consolidated
statements of comprehensive loss. Refer to Note 4. Fair Value Measurements for the fair value of the
liability-classified Warrants.
Note 18. Net Loss Per Share
Basic net loss per share is calculated by dividing the net loss by the weighted-average number of
shares of common stock outstanding for the period, less any shares subject to repurchase. Diluted net
loss per share is computed by giving effect to all potential dilutive common stock equivalents outstanding
for the period. For purposes of this calculation, options to purchase common stock, RSUs, PSUs, shares
issuable pursuant to our ESPP, and shares subject to repurchase from early exercised options and
unvested restricted stock are considered common stock equivalents but have been excluded from the
calculation of diluted net loss per share as their effect is antidilutive.
The rights, including the liquidation and dividend rights, of the holders of our Class A and Class B
common stock are identical, except with respect to voting and conversion. As the liquidation and dividend
rights are identical, the undistributed earnings are allocated on a proportionate basis and the resulting net
105

loss per share will, therefore, be the same for both Class A and Class B common stock on an individual or
combined basis. We did not present dilutive net loss per share on an as-if converted basis because the
impact was not dilutive.
The following table presents the calculation of basic and diluted net loss per share for the periods
presented (in thousands, except per share data):
Fiscal Year Ended January 31,
2024
2023
2022
Numerator:
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (68,193) $(197,970) $ (99,425)
Denominator:
Weighted-average common shares outstanding, basic and diluted . . . .
140,147
131,441
124,206
Net loss per share, basic and diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
(0.49) $
(1.51) $
(0.80)
Since we were in a net loss position for all periods presented, basic net loss per share attributable to
common stockholders is the same as diluted net loss per share as the inclusion of all potential common
shares outstanding would have been anti-dilutive. Potentially dilutive securities that were not included in
the diluted per share calculations because they would be anti-dilutive were as follows (in thousands):
As of January 31,
2024
2023
2022
2029 Notes conversion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
20,000
12,500
—
Unvested RSUs issued and outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,686
12,504
12,171
Issued and outstanding stock options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,083
7,761
8,560
Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,500
7,500
—
Unvested PSUs issued and outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,310
2,905
—
Shares committed under ESPP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
310
316
144
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
47,889
43,486
20,875
Note 19. Zephr Acquisition
On September 2, 2022 (Acquisition Closing Date), we acquired all of the outstanding equity securities
of Zephr, a leading Subscription Experience Platform used by global digital publishing and media
companies, pursuant to a Share Purchase Agreement (Zephr SPA).
Purchase Consideration
The purchase consideration for the Zephr acquisition was $47.9 million, which includes (1) cash
payments of $43.1 million and (2) contingent consideration with an estimated fair value of $4.8 million on
the Acquisition Closing Date, payable if certain conditions are met.
The contingent consideration arrangement required us to pay the former stockholders of Zephr a
multiple of the amount by which Zephr’s Annual Recurring Revenue (ARR) as of January 31, 2023
exceeds a target set in the Zephr SPA. The payment was between zero and $6.0 million, dependent upon
Zephr’s ARR achievement. The fair value of the contingent consideration arrangement as of the
Acquisition Closing Date was estimated by applying a probability-weighted discounted cash flow method.
This analysis reflected the contractual terms of the Zephr SPA (e.g., potential payment amounts, length of
measurement periods, manner of calculating any amounts due, etc.) and utilized assumptions with regard
to future cash flows, probabilities of achieving such future cash flows, and a discount rate.
As of January 31, 2023, the contingent consideration arrangement was revalued to $4.4 million
based on the expected final payout amount, resulting in a credit of $0.4 million which is included in
General and administrative in the accompanying consolidated statements of comprehensive loss for fiscal
2023. Contingent consideration was classified as a liability and included in Accrued expenses and other
current liabilities in the accompanying consolidated balance sheets as of January 31, 2023. In fiscal 2024,
we paid $4.5 million to settle the contingent consideration.
106

Assets and Liabilities Acquired
The acquisition was accounted for as a business combination using the acquisition method of
accounting in accordance with ASC 805, Business Combinations. The excess of the purchase price over
the estimated fair value of the tangible and intangible assets acquired and liabilities assumed has been
recorded as goodwill. The Zephr acquisition resulted in recorded goodwill as a result of the synergies
expected to be realized and how we expect to leverage the business to create additional value for our
shareholders. The goodwill is not deductible for income tax purposes.
The following table summarizes the fair value of the assets acquired and liabilities assumed (in
thousands):
Total
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 2,103
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
131
Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
916
Fixed Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
120
Intangible assets:
Tradename. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
800
Developed technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,300
Customer relationships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
900
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
35,519
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(292)
Accrued liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(303)
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(225)
Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2,056)
Fair value of net assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$47,913
The fair value of the acquired trade accounts receivables approximated their carrying value due to
the short-term nature of the expected timeframe to collect the amounts due to us and the contractual cash
flows.
We engaged a third-party specialist to assist management in the determination of the estimated fair value
of intangible assets acquired. Variations of the income approach were used to estimate the fair values.
Specifically, the relief from royalty method was used to measure the trade name, the multi period excess
earnings method was used to measure the developed technology, and the distributor method was used to
measure the customer relationships. The following table summarizes the acquired identifiable intangible
assets, Acquisition Closing Date estimated fair values, and estimated useful lives (dollars in thousands):
Fair Value
Useful Life
Trade name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
800
3.0 years
Developed technology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,300
7.0 years
Customer relationships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
900 10.0 years
Total intangible assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $12,000
Transaction Costs
We incurred transaction costs in connection with the acquisition of $0.2 million and $3.2 million
during the fiscal years ended January 31, 2024 and January 31, 2023, respectively, which were expensed
as incurred and reflected as part of General and administrative within the accompanying consolidated
statements of comprehensive loss.
Employee Deferral
We agreed to pay $2.9 million to certain former Zephr employees, half of which was paid in
September 2023 and the remainder of which is payable in September 2024, contingent upon continued
employment with us through those dates. These costs are being recognized as compensation expense as
service is provided through the respective payment dates.
107

Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
Not applicable.
Item 9A.
Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer (our principal executive officer)
and Chief Financial Officer (our principal financial officer), has evaluated the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange
Act) as of January 31, 2024. Based on such evaluation, our Chief Executive Officer and Chief Financial
Officer have concluded that as of January 31, 2024, our disclosure controls and procedures were effective
to provide reasonable assurance that information required to be disclosed in the reports we file and
submit under the Exchange Act is recorded, processed, summarized and reported as and when required,
and that such information is accumulated and communicated to our management, including our Chief
Executive Officer and Chief Financial Officer, to allow timely decisions regarding its required disclosure.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Our
management conducted an evaluation of the effectiveness of our internal control over financial reporting
as of January 31, 2024 based on the criteria established in Internal Control - Integrated Framework
(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the
results of its evaluation, management concluded that our internal control over financial reporting was
effective as of January 31, 2024. The effectiveness of our internal control over financial reporting as of
January 31, 2024 has been audited by KPMG LLP, our independent registered public accounting firm, as
stated in its report which is included in Part II, Item 8 of the Annual Report on Form 10-K.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f)
and 15d-15(f) under the Exchange Act) that occurred during the three months ended January 31, 2024
that has materially affected, or is reasonably likely to materially affect, our internal control over financial
reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect
that our disclosure controls and procedures or our internal control over financial reporting will prevent or
detect all errors and all fraud. A control system, no matter how well designed and operated, can provide
only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the
design of a control system must reflect the fact that there are resource constraints, and the benefits of
controls must be considered relative to their costs. Because of the inherent limitations in all control
systems, no evaluation of controls can provide absolute assurance that all control issues and instances of
fraud, if any, within our company have been detected. Accordingly, our disclosure controls and procedures
provide reasonable assurance of achieving their objectives.
Item 9B.
Other Information
Rule 10b5-1 Trading Arrangements
During the three months ended January 31, 2024, none of our directors or executive officers adopted
or terminated any contract, instruction or written plan for the purchase or sale of Zuora securities that was
intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act or any
‘‘non-Rule 10b5-1 trading arrangement’’ as defined in Item 408 of Regulation S-K.
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
108

PART III
Item 10.
Directors, Executive Officers and Corporate Governance
The information required by this item is incorporated herein by reference to information contained in
the Proxy Statement relating to our 2024 Annual Meeting of Stockholders.
Item 11.
Executive Compensation
The information required by this item is incorporated herein by reference to information contained in
the Proxy Statement relating to our 2024 Annual Meeting of Stockholders.
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
The information required by this item is incorporated herein by reference to information contained in
the Proxy Statement relating to our 2024 Annual Meeting of Stockholders.
Item 13.
Certain Relationships and Related Transactions, and Director Independence
The information required by this item is incorporated herein by reference to information contained in
the Proxy Statement relating to our 2024 Annual Meeting of Stockholders.
Item 14.
Principal Accounting Fees and Services
The information required by this item is incorporated herein by reference to information contained in
the Proxy Statement relating to our 2024 Annual Meeting of Stockholders.
109

PART IV
Item 15.
Exhibits, Financial Statement Schedules
(a)
The following documents are filed as a part of this Form 10-K:
1.
Financial Statements
Our consolidated financial statements are listed in the ‘‘Index to Consolidated Financial Statements’’
under Part II, Item 8 of this Form 10-K.
2.
Financial Statement Schedules
Financial statement schedules not listed have been omitted because they are not applicable or the
required information is shown in the consolidated financial statements or notes thereto.
3.
Exhibits
Incorporated By Reference
Exhibit
Number
Exhibit Description
Form
File No.
Exhibit
Filing
Date
Filed or
Furnished
Herewith
3.1
Restated Certificate of Incorporation of the
Registrant.
10-Q 001-38451
3.1 6/13/2018
3.2
Amended and Restated Bylaws of the Registrant.
8-K
001-38451
3.1
5/5/2020
4.1
Form of Class A Common Stock Certificate of the
Registrant.
S-1 333-223722
4.1 3/16/2018
4.2
Description of Registrant’s Securities.
X
4.3
Indenture, dated as of March 24, 2022, by and
between Zuora, Inc. and U.S. National Bank
Association, as trustee (including the form of
3.95% / 5.50% Convertible Senior PIK Notes Due
2029).
8-K
001-38451
10.23/25/2022
4.4
First Supplemental Indenture, dated
September 22, 2023, by and between U.S. Bank
Trust Company, National Association, as trustee,
and the Registrant.
10-Q 001-38451
4.1 12/7/2023
4.5
Form of 3.95% / 5.50% Convertible Senior PIK
Notes Due 2029 (included in Exhibit 4.3).
8-K
001-38451
10.23/25/2022
4.6
Form of Warrant.
8-K
001-38451
10.33/25/2022
10.1*
Form of Indemnification Agreement by and
between the Registrant and each of its directors
and executive officers.
S-1 333-223722
10.13/16/2018
10.2*
2006 Equity Incentive Plan and forms of award
agreements.
S-1 333-223722
10.23/16/2018
10.3*
2015 Equity Incentive Plan and forms of award
agreements.
S-1 333-223722
10.33/16/2018
10.4*
2018 Equity Incentive Plan and forms of award
agreements.
S-1 333-223722
10.43/16/2018
10.5*
2018 Employee Stock Purchase Plan and form of
subscription agreement.
S-1 333-223722
10.53/16/2018
10.6*
Offer Letter, dated March 6, 2018, between Tien
Tzuo and the Registrant.
S-1 333-223722
10.63/16/2018
10.7*
Offer Letter, dated January 7, 2016, between
Kenneth Goldman and the Registrant.
S-1 333-223722
10.93/16/2018
10.8*
Offer Letter, dated May 8, 2017, between
Magdalena Yesil and the Registrant.
S-1 333-223722 10.103/16/2018
110

Incorporated By Reference
Exhibit
Number
Exhibit Description
Form
File No.
Exhibit
Filing
Date
Filed or
Furnished
Herewith
10.9*
Offer Letter, dated September 17, 2019, between
Robert J. Traube and the Registrant.
10-K 001-38451 10.123/31/2020
10.10*
Offer Letter dated May 25, 2020, between Todd
McElhatton and the Registrant.
10-Q 001-38451
10.1 9/4/2020
10.11*
Offer Letter, dated December 17, 2020, between
Sridhar Srinivasan and the Registrant.
10-K 001-38451 10.143/31/2021
10.12*
Offer Letter, dated January 9, 2022, between
Andrew Cohen and the Registrant.
10-K 001-38451 10.12 4/3/2023
10.13*
Offer Letter, dated May 18, 2023, between Peter
Hirsch and the Registrant.
10-Q 001-38451
10.1 9/6/2023
10.14*
Form of Change in Control and Severance
Agreement.
10-K 001-38451 10.143/28/2022
10.15*
Cash Incentive Plan.
X
10.16
Investment Agreement, dated as of March 2, 2022,
by and between Zuora, Inc. and Silver Lake Alpine
II, L.P.
8-K
001-38451
10.13/25/2022
10.17
Amendment No. 1 to the Investment Agreement,
dated September 22, 2023, by and between Silver
Lake and the Registrant.
10-Q 001-38451
10.112/7/2023
10.18
Letter Agreement, dated October 27, 2023, by and
among First-Citizens Bank & Trust and the
Registrant.
10-Q 001-38451
10.212/7/2023
10.19
Lease Agreement between 101 Redwood Shores
LLC, As Landlord and Zuora, Inc., as Tenant dated
March 19, 2019.
8-K
001-38451
10.13/21/2019
10.20
Loan and Security Agreement, dated June 14,
2017, by and among Silicon Valley Bank, the
Registrant, Zuora Services, LLC, and Leeyo
Software, Inc.
S-1 333-223722 10.133/16/2018
10.21
First Amendment to Loan and Security Agreement,
dated October 11, 2018, by and among Silicon
Valley Bank, the Registrant, Zuora Services, LLC,
and Leeyo Software, Inc.
10-Q 001-38451
10.112/13/2018
10.22
Second Amendment to Loan and Security
Agreement, dated January 19, 2021, by and
among Silicon Valley Bank, the Registrant, Zuora
Services, LLC, and Leeyo Software, Inc.
10-K 001-38451 10.213/31/2021
10.23
Third Amendment to Loan and Security
Agreement, dated October 11, 2022, by and
among Silicon Valley Bank and the Registrant.
10-Q 001-38451
10.112/8/2022
21.1
Subsidiaries of the Registrant.
X
23.1
Consent of Independent Registered Public
Accounting Firm.
X
31.1
Certification of Chief Executive Officer pursuant to
Rule 13a-14(a) and 15d-14(a) of the Exchange
Act.
X
31.2
Certification of Chief Financial Officer pursuant to
Rule 13a-14(a) and 15d-14(a) of the Exchange
Act.
X
111

Incorporated By Reference
Exhibit
Number
Exhibit Description
Form
File No.
Exhibit
Filing
Date
Filed or
Furnished
Herewith
32.1**
Certification of the Chief Executive Officer
pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
X
32.2**
Certification of the Chief Financial Officer pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
X
97.1
Zuora, Inc. Executive Compensation Recovery
Policy
X
99.1
Notice of Pendency and Proposed Settlement.
8-K
001-38451
99.17/25/2023
99.2
Stipulation and Agreement of Settlement.
8-K
001-38451
99.27/25/2023
101.INS Inline XBRL Instance Document - the instance
document does not appear in the Interactive Data
File because its XBRL tags are embedded within
the Inline XBRL document
X
101.SCHInline XBRL Taxonomy Extension Schema
Document
X
101.CAL Inline XBRL Taxonomy Extension Calculation
Linkbase Document
X
101.DEF Inline XBRL Taxonomy Extension Definition
Linkbase Document
X
101.LAB Inline XBRL Taxonomy Extension Label Linkbase
Document
X
101.PRE Inline XBRL Taxonomy Extension Presentation
Linkbase Document
X
104
Cover Page Interactive Data File (embedded
within the Inline XBRL document and included in
Exhibit 101).
X
*
Indicates a management contract or compensatory plan or arrangement in which directors or executive officers are eligible to
participate.
**
The certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Form 10-K and are not deemed
‘‘filed’’ for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall they be
deemed incorporated by reference into any filing under the Securities Act or the Exchange Act.
Item 16.
Form 10-K Summary
None.
112

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ZUORA, INC.
Date: March 26, 2024
By:
/s/ Todd McElhatton
Todd McElhatton
Chief Financial Officer
(Principal Financial Officer)
Date: March 26, 2024
By:
/s/ Matthew Dobson
Matthew Dobson
Chief Accounting Officer
(Principal Accounting Officer)
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Tien Tzuo and Todd McElhatton, and each of them, as his or her true and lawful
attorneys-in-fact and agents, with full power of substitution and resubstitution, for him or her and in his or
her name, place and stead, in any and all capacities, to sign any amendments to this Annual Report on
Form 10-K and to file the same, with all exhibits thereto and other documents in connection therewith with
the Securities and Exchange Commission, granting unto said attorneys-in-fact, proxies, and agents full
power and authority to do and perform each and every act and thing requisite and necessary to be done
in connection therewith, as fully for all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact, proxies, and agents, or their or his or her substitute
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Annual
Report on Form 10-K has been signed below by the following persons on behalf of the Registrant and in
the capacities and on the dates indicated:
Signature
Title
Date
/s/ Tien Tzuo
Chairman of the Board of Directors
and Chief Executive Officer
(Principal Executive Officer)
March 26, 2024
Tien Tzuo
/s/ Todd McElhatton
Chief Financial Officer
(Principal Financial Officer)
March 26, 2024
Todd McElhatton
/s/ Omar Abbosh
Director
March 26, 2024
Omar Abbosh
/s/ Sarah Bond
Director
March 26, 2024
Sarah Bond
/s/ Laura A. Clayton
Director
March 26, 2024
Laura A. Clayton
113

Signature
Title
Date
/s/ Kenneth A. Goldman
Director
March 26, 2024
Kenneth A. Goldman
/s/ Timothy Haley
Director
March 26, 2024
Timothy Haley
/s/ Joseph Osnoss
Director
March 26, 2024
Joseph Osnoss
/s/ Jason Pressman
Director
March 26, 2024
Jason Pressman
/s/ Amy Guggenheim Shenkan
Director
March 26, 2024
Amy Guggenheim Shenkan
114

CORPORATE HEADQUARTERS
Zuora, Inc.
101 Redwood Shores Parkway 
Redwood City, CA 94065
INVESTOR RELATIONS
Email: investorrelations@zuora.com
Phone: 650-419-1377
STOCK TRANSFER AGENT
Computershare Trust Company, N.A.
P.O. Box 43006
Providence, RI 02940-3006
Email: web.queries@computershare.com 
Toll Free Phone: 800-962-4284 (U.S., Canada, 
Puerto Rico)
Phone: 781-575-4247 (Non-U.S.)
STOCK EXCHANGE LISTING
New York Stock Exchange (NYSE) 
Symbol: ZUO
BOARD OF DIRECTORS
Tien Tzuo
Chairman of the Board of Directors  
& Chief Executive Officer
Jason Pressman
Lead Independent Director
Omar P. Abbosh
Director 
Sarah R. Bond
Director
Laura A. Clayton
Director
Kenneth A. Goldman
Director
Timothy Haley
Director
Joseph Osnoss
Director
Amy Guggenheim Shenkan
Director
Magdalena Yesil 
Director
EXECUTIVE OFFICERS
Tien Tzuo
Chairman of the Board of Directors  
& Chief Executive Officer
Todd E. McElhatton
Chief Financial Officer
Andrew M. Cohen
Chief Legal Officer and Corporate Secretary
Robert J. E. Traube
President and Chief Revenue Officer
Jason Pressman
Omar P. Abbosh
Sarah R. Bond
Laura A. Clayton
Kenneth A. Goldman
Timothy Haley
Joseph Osnoss
Amy Guggenheim Shenkan
John D. Harkey Jr.
Tien Tzuo
Tien Tzuo
Lead Independent Director
Director
Director
Director
Director
Director
Director
Director
Director
Chairman of the Board of Directors 
& Chief Executive Officer
Chairman of the Board of Directors 
& Chief Executive Officer
BOARD OF DIRECTORS
EXECUTIVE OFFICERS
Todd E. McElhatton
Andrew M. Cohen
Robert J. E. Traube
Peter D. Hirsch
Chief Financial Officer
Chief Legal Officer and 
Corporate Secretary
President and Chief Revenue Officer
Product and Technology Officer
Zuora, Inc.
101 Redwood Shores Parkway 
Redwood City, CA 94065
New York Stock Exchange (NYSE)
Computershare Trust Company, N.A. P.O. 
Box 43006
Providence, RI 02940-3006
CORPORATE HEADQUARTERS
STOCK EXCHANGE LISTING
STOCK TRANSFER AGENT
INVESTOR RELATIONS
Email:   investorrelations@zuora.com
Email:   web.queries@computershare.com
Phone:   650-419-1377
Symbol:   ZUO
Toll Free Phone:   800-962-4284 (U.S., 
Canada, Puerto Rico)
Phone:   781-575-4247 (Non-U.S.)