Income Taxes |
3 Months Ended |
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Apr. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes Our tax provision for or benefit from income taxes for interim periods is determined using an estimate of our annual effective tax rate as prescribed under Accounting Standards Codification (“ASC”) 740, “Income Taxes”, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment, which results in a provision for or benefit from income taxes in the current quarter. Our income tax provision was $1.7 million and $2.8 million for the three months ended April 30, 2025 and 2024. The decrease in tax expense was primarily attributable to increased discrete tax benefits related to stock-based compensation, offset by increased tax expense on larger quarterly earnings. We regularly assess the need for a valuation allowance on our deferred tax assets. In making this assessment, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more likely than not that some or all the deferred tax assets will not be realized. As of April 30, 2025, we continue to maintain valuation allowances related to certain federal deferred tax assets subject to limitation on use and our California and Ireland deferred tax assets. As of April 30, 2025, our gross unrecognized tax benefits totaled $80.4 million, excluding related accrued interest and penalties, of which $64.8 million would impact the effective tax rate if recognized. Our policy is to account for interest and penalties related to uncertain tax positions as a component of income tax provision. We do not expect material changes to our gross unrecognized tax benefits within the next 12 months.
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