v3.26.1
Income Taxes
 12 Months Ended
Jan. 31, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of the provision for income taxes are as follows (in thousands):
Fiscal Year Ended January 31,
202620252024
Current:
Federal$— $— $— 
State and local48 12 65 
Foreign5,677 3,584 2,380 
Total current5,725 3,596 2,445 
Deferred:
Federal$(1,640)$— $— 
State and local(1,312)— — 
Foreign(148)(151)(488)
Total deferred(3,100)(151)(488)
Provision for income taxes
$2,625 $3,445 $1,957 

The components of loss before income taxes are as follows (in thousands):
Fiscal Year Ended January 31,
202620252024
United States$(140,469)$(108,413)$(130,927)
Foreign12,308 7,811 2,455 
Loss before provision for income taxes$(128,161)$(100,602)$(128,472)

We adopted ASU 2023-09 "Income Taxes (Topic 740): Improvements To Income Tax Disclosures" on a prospective basis beginning with the year ended January 31, 2026. The following table presents required disclosure pursuant to ASU 2023-09 and reconciles the U.S. federal statutory tax amount and rate to our actual global effective amount and rate for the year ended January 31, 2026 (in thousands, except rates):

Fiscal Year Ended January 31, 2026
AmountPercent
Statutory income tax expense
$(26,914)21.0 %
State and local income taxes, net of federal income tax effect (1)
(1,264)1.0 %
Foreign tax effects
Canada
Canada - share-based payment disallowance1,637 (1.3)%
Other adjustments182 (0.1)%
 Other foreign jurisdictions1,124 (0.9)%
Effects of cross-border tax laws:
Global intangible low-taxed income (GILTI)1,619 (1.3)%
Other255 (0.2)%
Tax credits:
Research and development credit(3,870)3.0 %
Changes in valuation allowances10,942 (8.5)%
Nontaxable or nondeductible items:
Executive compensation limitation
8,843 (6.9)%
Stock-based compensation
5,143 (3.9)%
Nondeductible transaction costs
1,267 (1.0)%
Other940 (0.7)%
Changes in unrecognized tax benefits1,994 (1.6)%
Other adjustments727 (0.6)%
Effective tax$2,625 (2.0)%
(1) The jurisdictions that contribute to the majority of the tax effect in this category are New York and California.

The following table presents the required disclosures prior to our adoption of ASU 2023-09. A reconciliation of the provision for income taxes to the amounts computed by applying the statutory federal income tax rate to earnings before income taxes is shown as follows:
Fiscal Year Ended January 31,
20252024
Statutory income tax expense21.0 %21.0 %
Foreign tax rate differential(0.2)%— %
State taxes— %(0.1)%
Permanent items(2.0)%(0.2)%
Change in valuation allowance(25.2)%(28.9)%
Stock-based compensation5.7 %5.1 %
Non-deductible compensation
(5.3)%(2.5)%
Tax credits8.6 %4.1 %
Changes in unrecognized tax benefits
(6.0)%— %
Effective tax rate(3.4)%(1.5)%

Deferred Income Taxes

The tax effects of cumulative temporary differences that give rise to significant deferred tax assets and deferred tax liabilities are presented below (in thousands). The valuation allowance relates to deferred tax assets for which it is more likely than not that the tax benefit will not be realized.
January 31,
20262025
Deferred tax assets:
Loss carryforwards$143,421 $109,064 
Compensation and benefits25,704 20,285 
Operating lease liabilities20,361 21,853 
Tax credits17,022 14,402 
Capitalized costs23,368 33,178 
Other4,896 5,682 
Deferred tax assets234,772 204,464 
Less: valuation allowance(175,122)(164,228)
Deferred tax asset, net of valuation allowance$59,650 $40,236 
Deferred tax liabilities:
Deferred contract costs$(24,405)$(18,627)
Property, equipment and software(1,971)(2,139)
Operating lease right-of-use assets(17,802)(19,052)
Intangible assets
(15,134)(749)
Other
(463)— 
Deferred tax liabilities(59,775)(40,567)
Net deferred tax assets/(liabilities)$(125)$(331)

As of January 31, 2026, we had NOL carryforwards for federal and state income tax purposes of approximately $543.1 million and $339.6 million, respectively. Under current law, U.S. federal NOLs incurred in tax years beginning after December 31, 2017 may be carried forward indefinitely, but the deductibility of federal NOLs is limited to 80% of taxable income in tax years beginning after December 31, 2020. Accordingly, $503.7 million of our NOLs may be carried forward indefinitely for federal tax purposes and $39.4 million, if not utilized, will expire at various times between 2035 and 2037. The majority of state NOLs if not utilized, will expire at various times between 2026 and 2046. We also had foreign NOL carryforwards as of January 31, 2026 of $26.6 million, the majority of which may be carried forward indefinitely. As of January 31, 2025, we had NOL carryforwards for federal, state, and foreign income tax purposes of approximately $392.3 million, $284.2 million, and $32.3 million, respectively.

At January 31, 2026, the Company had tax credit carryforwards of $26.8 million, the majority of which are related to credits for research activities, and if not utilized, will expire between 2037 and 2046. As of January 31, 2025, the Company has tax credit carryforwards of $21.8 million.
IRC Sections 382 and 383 place a limitation on the amount of taxable income that can be offset by carryforward tax attributes, such as net operating losses or tax credits, after a change in control. Generally, after a change in control, a loss corporation cannot deduct carryforward tax attributes in excess of the limitation prescribed by Sections 382 and 383. Therefore, certain of our carryforward tax attributes may be subject to an annual limitation regarding their utilization against taxable income in future periods. As a result of issuances of different classes of preferred stock to investors in 2013, 2014 and 2017, we triggered “ownership shifts” as defined in Internal Revenue Code Section 382 and related provisions. These ownership shifts resulted in a reduction of NOLs in the fiscal year ended January 31, 2021 of $13.8 million and credits of $0.7 million. Our utilization of our NOLs and credits is limited by these ownership shifts but those limitations do not have a significant impact to the financial statements since there is no utilization of the NOLs and credits and a full valuation allowance exists against the net operating losses and credits. Subsequent ownership changes may subject us to additional annual limitations of its net operating losses. Such annual limitation could result in the expiration of the NOLs and credits.

We determine our valuation allowance on deferred tax assets by considering both positive and negative evidence to ascertain whether it is more likely than not that deferred tax assets will be realized. Realization of deferred tax assets is dependent upon the generation of future taxable income, if any, the timing, and amount of which are uncertain. Due to our history of losses, we believe that it is not more likely than not that the deferred tax assets will be realized as of January 31, 2026, for jurisdictions that are in a net deferred tax asset position. Accordingly, we have recorded a full valuation allowance against these respective net deferred tax assets. The valuation allowance increased by $10.9 million, and $28.4 million, during the fiscal years ended January 31, 2026, and 2025, respectively. The change in the valuation allowance for the year ended January 31, 2026 includes a partial release of the valuation allowance of $2.9 million in connection with the acquisition of Offerfit. The net deferred tax liability from the acquisition provided a source of additional income to support the realizability of our pre-existing deferred tax assets and, as a result, we released a portion of our valuation allowance.

The Company has not provided for U.S. federal income and foreign withholding taxes on undistributed earnings from non-U.S. operations as of January 31, 2026 because the Company intends to reinvest such earnings indefinitely outside of the United States. The amount of any unrecognized deferred tax liability related to these earnings would not be material.

A reconciliation of the beginning and ending amount of unrecognized tax benefits, including penalties but excluding interest, is as follows (in thousands):

Fiscal Year Ended January 31,
202620252024
Balance at February 1$7,061 $— $— 
Additions for tax positions of prior years244 4,521 — 
Additions based on tax positions related to current year
1,982 2,540 — 
Reductions for tax positions of prior years— — — 
Balance at January 31$9,287 $7,061 $— 

The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in the income tax provision. As of January 31, 2026, the amounts of interest and penalties recognized were immaterial. As of January 31, 2025 and 2024, there were no interest and penalties recorded.

As of January 31, 2026, 2025 and 2024, accrued unrecognized tax benefits were $9.3 million, $7.1 million, and $0.0 million, respectively, and if recognized would affect the provision for income taxes, and our effective tax rate.

We are subject to income tax examinations in the United States and various state and foreign jurisdictions. Our most significant operations are in the United States and the earliest open tax year subject to potential examination is the period ended January 31, 2023. However, amounts reported as NOLs from these prior tax periods also remain subject to review by most tax authorities.

Cash Taxes Paid

We adopted ASU 2023-09 on a prospective basis for the fiscal year ended January 31, 2026, and have included the following table as a result of our adoption, which presents income taxes paid (net of refunds received) for the fiscal year ended January 31, 2026 (in thousands):
Fiscal Year Ended January 31, 2026
Federal taxes$— 
State taxes65 
Foreign taxes:
Canada2,555 
Singapore839 
France254 
UK(247)
Ireland246 
Brazil153 
Other31 
Total cash taxes paid$3,896 

Below is a summary of income taxes paid for the fiscal years ended January 31, 2025 and 2024 (in thousands):

Fiscal Year Ended January 31,
20252024
Cash paid during the year for:
  Income taxes, net of refunds$2,945 $309