v3.26.1
Fair Value Measurements
 9 Months Ended
Apr. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The following table presents our financial assets and liabilities measured at fair value on a recurring basis as of April 30, 2026 and July 31, 2025 (in millions):
April 30, 2026July 31, 2025
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Cash equivalents:
Money market funds$944 $— $— $944 $1,206 $— $— $1,206 
Commercial paper— 535 — 535 — 169 — 169 
Corporate debt securities— 2 — 2 — — — — 
U.S. government and agency securities— 75 — 75 — — — — 
Total cash equivalents944 612 — 1,556 1,206 169 — 1,375 
Short-term investments:
Certificates of deposit— — — — — — — — 
Commercial paper— 10 — 10 — 15 — 15 
Corporate debt securities— 413 — 413 — 584 — 584 
U.S. government and agency securities— 27 — 27 — 6 — 6 
Non-U.S. government and agency securities— — — — — 3 — 3 
Asset-backed securities— 13 — 13 — 22 — 22 
Total short-term investments— 463 — 463 — 630 — 630 
April 30, 2026July 31, 2025
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Long-term investments:
Corporate debt securities— 3,118 — 3,118 — 4,050 — 4,050 
U.S. government and agency securities— 39 — 39 — 164 — 164 
Non-U.S. government and agency securities— — — — — 26 — 26 
Asset-backed securities— 724 — 724 — 1,315 — 1,315 
Total long-term investments— 3,881 — 3,881 — 5,555 — 5,555 
Prepaid expenses and other current assets:
Foreign currency forward contracts— 64 — 64 — 58 — 58 
Total prepaid expenses and other current assets— 64 — 64 — 58 — 58 
Other assets:
Foreign currency forward contracts— 1 — 1 — 3 — 3 
Capped calls related to convertible senior notes— 94 — 94 — — — — 
Total other assets— 95 — 95 — 3 — 3 
Total assets measured at fair value$944 $5,115 $— $6,059 $1,206 $6,415 $— $7,621 
Short-term convertible senior notes$— $160 $— $160 $— $— $— $— 
Accrued and other liabilities:
Foreign currency forward contracts— 5 — 5 — 4 — 4 
Contingent consideration
— — 124 124 — — 276 276 
Total accrued and other liabilities— 5 124 129 — 4 276 280 
Long-term convertible senior notes— 1,192 — 1,192 — — — — 
Other long-term liabilities:
Foreign currency forward contracts— 1 — 1 — — — — 
Contingent consideration
— — 116 116 — — 238 238 
Total other long-term liabilities— 1 116 117 — — 238 238 
Total liabilities measured at fair value$— $1,358 $240 $1,598 $— $4 $514 $518 
As part of our acquisition of certain QRadar assets from International Business Machines Corporation (“IBM”) on August 31, 2024, we agreed to make post-closing payments to IBM contingent upon customers entering into qualified new transactions through June 30, 2028. Payments related to the contingent consideration liability commenced in the fiscal quarter ended October 2025 and are expected to continue through the fiscal quarter ending October 2028. The estimated range of undiscounted contingent consideration is between $0.3 billion and $0.5 billion.
The fair value of our contingent consideration liability is estimated using a discounted cash flow valuation technique. We consider the fair value of our contingent consideration liability to be a Level 3 measurement as we use unobservable inputs in determining discounted cash flows to estimate the fair value. The significant unobservable inputs include an estimate of future cash payments related to customers entering into qualified new transactions as well as a risk-adjusted discount rate used to present value the expected cash flows. A significant change in any of these assumptions could have a material impact to the fair value of our contingent consideration liability.
During the three months ended April 30, 2026, we reduced our estimate of future cash payments based on our quarterly assessment of assumptions, including the magnitude and likelihood of customers entering into qualified new transactions, the competitive industry environment, and current market conditions.
The following table presents a reconciliation of our contingent consideration liability (in millions):
Three Months Ended April 30,Nine Months Ended April 30,
2026202520262025
Contingent consideration liability at the beginning of the period
$369 $665 $514 $— 
Initial valuation on the acquisition date
— — — 649 
Change in fair value
(110)4 (120)20 
Payments
(19)— (154)— 
Contingent consideration liability at the end of the period
$240 $669 $240 $669 
The total estimated fair value of our financing receivables approximates their carrying amounts as of April 30, 2026 and July 31, 2025. We consider the fair value of our financing receivables to be a Level 3 measurement as we use unobservable inputs in determining discounted cash flows to estimate the fair value.