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YEXT, INC. Management’s Discussion and Analysis of Financial Position and Operating Results (Form 10-Q)

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The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our condensed consolidated
financial statements and related notes appearing elsewhere in this Quarterly
Report on Form 10-Q and in our Annual Report on Form 10-K for the fiscal year
ended January 31, 2021, filed with the SEC on March 16, 2021. 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 discussed in the section titled "Risk Factors" under Part II, Item 1A in
this Quarterly Report on Form 10-Q.
Overview
Yext organizes a business's facts so it can provide official answers to consumer
questions starting with the business's own website and then extending across
search engines and voice assistants. Our platform lets businesses structure the
facts about their brands in a database called the Knowledge Graph. Our platform
is built to leverage the structured data stored in the Knowledge Graph to
deliver a modern search experience on a business's or organization's own
website, as well as across approximately 200 service and application providers,
which we refer to as our Knowledge Network and includes Amazon Alexa, Apple
Maps, Bing, Cortana, Facebook, Google, Google Assistant, Google Maps, Siri and
Yelp. Our platform powers all of our key features, including Listings, Pages,
and Answers, along with its other features and capabilities.
We sell our platform throughout the world to customers of all sizes, including
our enterprise, mid-size, and third-party reseller customers. In transactions
with resellers, we are only party to the transaction with the reseller and are
not a party to the reseller's transaction with its customer.
Revenue is a function of the number of customers, the number of licenses with
each customer, the package to which each customer subscribes, the price of the
package and renewal rates. We offer subscriptions in a discrete range of
packages, with pricing based on specified feature sets and the number of
licenses managed by the customer as well as on a capacity-basis.
Fiscal Year
Our fiscal year ends on January 31st. References to fiscal 2022, for example,
are to the fiscal year ending January 31, 2022.
COVID-19 Update
The COVID-19 pandemic has disrupted business operations for us and our
customers, as well as suppliers, and other parties with whom we do business.
Such disruptions are expected to continue for an indefinite period of time.
We have adopted several measures in response to the COVID-19 pandemic and
continue to monitor regional developments to inform our operational decisions.
Our offices are open on a voluntary basis in accordance with guidance provided
by government agencies, although currently the majority of our employees are
still working remotely. Non-essential business travel remains restricted, and
while we continue to hold virtual events, we have also resumed in-person
marketing events. The uncertain duration of these measures have had and may
continue to have negative effects on our sales efforts and revenue growth
rates. We continue to be committed to our business, the strength of our
platform, our ability to continue to execute on our strategy, and our efforts to
support our customers.
We may continue to see some existing and potential customers, in particular
customers in industries that have been highly impacted by the pandemic such as
retail and food services, as well as certain geographies such as Europe, reduce,
suspend or delay technology spending; request to renegotiate contracts to obtain
concessions such as, extended billing and payment terms; shorten the duration of
contracts; or elect not to renew their subscriptions which could materially
adversely impact our business, financial condition and results of operations in
future periods. The ultimate extent of the impact of the pandemic will depend on
future developments, which continue to be highly uncertain and cannot be
predicted, including the severity and duration of the COVID-19 pandemic and its
variants, vaccination rates and efficacy and the actions taken to contain and
address the impact of the pandemic, among others. However, because we generally
recognize revenue from our customer contracts ratably over the term of the
contract, changes in our contracting activity in the near term may not be fully
reflected in our results of operations and overall financial performance until
future periods. See Part II Item 1A "Risk Factors" for further discussion of the
possible impact of the COVID-19 pandemic on our business.
Components of Results of Operations
Revenue
We derive our revenue primarily from subscription and associated support to our
Yext platform. Our contracts are typically one year in length, but may be up to
three years or longer in length. Revenue is a function of the number of
customers, the number of licenses or capacity purchased by each customer, the
package to which each customer subscribes, the price of the package and renewal
rates. Revenue is generally recognized ratably over the contract term beginning
on the commencement date of each contract, which is
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the date our platform is made available to customers. At the beginning of each
subscription term we invoice our customers, typically in annual installments,
but also monthly, quarterly, and semi-annually. Amounts that have been invoiced
for non-cancelable contracts are recorded in accounts receivable and unearned
revenue. Unearned revenue is subsequently recognized as revenue when transfer of
control to a customer has occurred.
Cost of Revenue
Cost of revenue consists primarily of employee-related costs, including
personnel-related costs, which mainly consist of salaries and wages, and
stock-based compensation expense. Cost of revenue also includes fees associated
with our Knowledge Network application provider arrangements, the nature of
which may be unpaid, fixed, or variable, and are unpaid with many of our larger
providers, as well as the costs associated with our data centers. In addition,
cost of revenue includes depreciation expense, including with respect to certain
capitalized software development costs incurred in connection with additional
functionality to our platform. Cost of revenue also includes operating and
short-term lease expenses associated with our office spaces, which are allocated
based on employee headcount. In addition, cost of revenue includes software
expense, which relates to licenses, professional services, and other costs
associated with software for use in the operations of our business, which is
also allocated based on employee headcount.
Operating Expenses
Sales and marketing expenses. Sales and marketing expenses consist primarily of
employee-related costs which are comprised of personnel-related costs and
stock-based compensation expense. Personnel-related costs mainly consist of
salaries and wages and costs of obtaining revenue contracts. Sales and marketing
expenses also include operating and short-term lease expenses associated with
our office spaces, as well as software expense, each of which are allocated
based on employee headcount. In addition, sales and marketing expenses include
costs related to advertising and conferences and brand awareness events.
Research and development expenses. Research and development expenses consist
primarily of employee-related costs which are comprised of personnel-related
costs and stock-based compensation expense. Personnel-related costs mainly
consist of salaries and wages. Capitalized software development costs related to
additional functionality to our platform are excluded from research and
development expenses as they are capitalized as a component of property and
equipment, net and depreciated to cost of revenue over the term of their useful
life. Research and development expenses also include operating and short-term
lease expenses associated with our office spaces, as well as software expense,
each of which are allocated based on employee headcount.
General and administrative expenses. General and administrative expenses consist
primarily of employee-related costs which are comprised of personnel-related
costs and stock-based compensation expense for our finance and accounting, human
resources, information technology and legal support departments.
Personnel-related costs mainly consist of salaries and wages. General and
administrative expenses also include operating and short-term lease expenses
associated with our office spaces, as well as software expense, each of which
are allocated based on employee headcount, and other professional related costs.
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Results of operations The following table presents certain condensed consolidated data of the results for each of the periods indicated:

                                           Three months ended October 31,                 Nine months ended October 31,
(in thousands)                                2021                   2020                   2021                   2020
Revenue                                $         99,529          $   89,061          $       289,645          $    262,467
Cost of revenue(1)                               25,255              21,639                   73,724                64,807
 Gross profit                                    74,274              67,422                  215,921               197,660
Operating expenses:
 Sales and marketing(1)                          58,548              56,646                  172,292               171,215
 Research and development(1)                     17,986              14,475                   50,343                43,641
 General and administrative(1)                   22,094              18,061                   61,284                57,993
 Total operating expenses                        98,628              89,182                  283,919               272,849
Loss from operations                            (24,354)            (21,760)                 (67,998)              (75,189)
Interest income                                       5                   9                       15                   524
Interest expense                                   (113)               (184)                    (403)                 (475)
Other expense, net                                 (191)                (38)                  (1,018)                 (545)
Loss from operations before income
taxes                                           (24,653)            (21,973)                 (69,404)              (75,685)
(Provision for) benefit from income
taxes                                              (273)                (68)                    (745)                 (696)
Net loss                               $        (24,926)         $  (22,041)         $       (70,149)         $    (76,381)


(1) The amounts include stock-based compensation expense as follows:

                                         Three months ended October 31,                 Nine months ended October 31,
(in thousands)                             2021                    2020                   2021                   2020
Cost of revenue                     $          1,840          $     1,513          $         5,597          $     4,053
Sales and marketing                            6,757                9,410                   19,635               25,151
Research and development                       5,469                4,228                   15,285               12,104
General and administrative                     5,389                4,136                   13,938               12,581
Total stock-based compensation
expense                             $         19,455          $    19,287          $        54,455          $    53,889



The following table sets forth selected condensed consolidated statements of
operations data for each of the periods indicated as a percentage of total
revenue:
                                          Three months ended October 31,                     Nine months ended October 31,
                                           2021                     2020                     2021                     2020
Revenue                                         100  %                   100  %                   100  %                   100  %
Cost of revenue                                  25                       24                       26                       25
 Gross profit                                  74.6                     75.7                     74.5                     75.3
Operating expenses:
 Sales and marketing                             59                       64                       60                       65
 Research and development                        18                       16                       17                       17
 General and administrative                      22                       20                       21                       22
 Total operating expenses                        99                      100                       98                      104
Loss from operations                            (24)                     (24)                     (24)                     (29)
Interest income                                   -                        -                        -                        -
Interest expense                                  -                       (1)                       -                        -
Other expense, net                               (1)                       -                        -                        -
Loss from operations before income
taxes                                           (25)                     (25)                     (24)                     (29)
(Provision for) benefit from income
taxes                                             -                        -                        -                        -
Net loss                                        (25) %                   (25) %                   (24) %                   (29) %

Note: Figures rounded for presentation purposes.

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Three Months Ended October 31, 2021 Compared to Three Months Ended October 31,
2020
Revenue and Cost of Revenue
                          Three months ended October 31,                   Variance
(in thousands)            2021                          2020         Dollars       Percent
 Revenue           $       99,529                    $ 89,061       $ 10,468          12  %
 Cost of revenue           25,255                      21,639       $  3,616          17  %
 Gross profit      $       74,274                    $ 67,422       $  6,852          10  %
 Gross margin                74.6   %                    75.7  %


Total revenue was $99.5 million for the three months ended October 31, 2021,
compared to $89.1 million for the three months ended October 31, 2020, an
increase of $10.5 million or 12%, primarily driven by new customer subscriptions
to our platform, as well as expanded subscriptions for existing customers. For
the three months ended October 31, 2021 and 2020, revenue recognized from
subscriptions and associated support to our platform was 92% and 93%, while
revenue recognized from professional services was 8% and 7%, respectively.
Cost of revenue was $25.3 million for the three months ended October 31, 2021,
compared to $21.6 million for the three months ended October 31, 2020, an
increase of $3.6 million or 17%. The increase was primarily driven by
employee-related costs, as personnel-related costs increased $2.6 million and
stock-based compensation expense increased $0.3 million, reflecting higher
headcount. In addition, depreciation expense increased $0.9 million. These
increases were partially offset by Knowledge Network application provider fees,
which decreased $1.3 million due to favorable contract renewal terms with
certain providers in the prior year.
Gross margin was 74.6% for the three months ended October 31, 2021, compared to
75.7% for the three months ended October 31, 2020 as reflected in the discussion
above.
Operating Expenses
                                      Three months ended October 31,                   Variance
(in thousands)                              2021                     2020        Dollars      Percent
 Sales and marketing          $         58,548                    $ 56,646      $ 1,902           3  %
 Research and development     $         17,986                    $ 14,475      $ 3,511          24  %
 General and administrative   $         22,094                    $ 18,061      $ 4,033          22  %


Sales and marketing expense was $58.5 million for the three months ended October
31, 2021, compared to $56.6 million for the three months ended October 31, 2020,
an increase of $1.9 million or 3%. The increase was primarily driven by a $1.9
million increase in personnel-related costs, which mainly consisted of salaries
and wages and costs to obtain revenue contracts, as well as a $0.8 million
increase in employee travel, a $0.8 million increase in conference and events,
and a $0.7 million increase in depreciation expense. These increases were
partially offset by a $2.7 million decrease in stock-based compensation expense,
which is lower in the current period reflecting the impact of certain departures
of senior management in the prior periods.
Research and development expense was $18.0 million for the three months ended
October 31, 2021, compared to $14.5 million for the three months ended October
31, 2020, an increase of $3.5 million or 24%. The increase was primarily driven
by employee-related costs, including a $1.3 million increase in
personnel-related costs and a $1.2 million increase in stock-based compensation
expense.
General and administrative expense was $22.1 million for the three months ended
October 31, 2021, compared to $18.1 million for the three months ended October
31, 2020, an increase of $4.0 million or 22%. The increase was primarily driven
by employee-related costs, including a $1.5 million increase in
personnel-related costs and a $1.3 million increase in stock-based compensation
expense.

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Nine Months Ended October 31, 2021 Compared to Nine Months Ended October 31,
2020
Revenue and Cost of Revenue
                          Nine months ended October 31,                  Variance
(in thousands)            2021                        2020         Dollars       Percent
 Revenue           $      289,645                 $ 262,467       $ 27,178          10  %
 Cost of revenue           73,724                    64,807       $  8,917          14  %
 Gross profit      $      215,921                 $ 197,660       $ 18,261           9  %
 Gross margin                74.5   %                  75.3  %


Total revenue was $289.6 million for the nine months ended October 31, 2021,
compared to $262.5 million for the nine months ended October 31, 2020, an
increase of $27.2 million or 10%, primarily driven by new customer subscriptions
to our platform, as well as expanded subscriptions for existing customers. For
the nine months ended October 31, 2021 and 2020, revenue recognized from
subscriptions and associated support to our platform was 92% and 93%, while
revenue recognized from professional services was 8% and 7%, respectively.
Cost of revenue was $73.7 million for the nine months ended October 31, 2021,
compared to $64.8 million for the nine months ended October 31, 2020, an
increase of $8.9 million or 14%. The increase was primarily driven by
employee-related costs, as personnel-related costs increased $6.2 million and
stock-based compensation expense increased $1.5 million, reflecting higher
headcount and employee stock grants. In addition, depreciation expense increased
$1.6 million and costs associated with our data centers increased $1.2 million.
These increases were partially offset by Knowledge Network application provider
fees which decreased $4.2 million due to favorable contract renewal terms with
certain providers in the prior year.
Gross margin was 74.5% for the nine months ended October 31, 2021, compared to
75.3% for the nine months ended October 31, 2020 as reflected in the discussion
above.
Operating Expenses
                                     Nine months ended October 31,                  Variance
(in thousands)                            2021                   2020         Dollars      Percent
 Sales and marketing          $       172,292                 $ 171,215      $ 1,077           1  %
 Research and development     $        50,343                 $  43,641      $ 6,702          15  %
 General and administrative   $        61,284                 $  57,993      $ 3,291           6  %


Sales and marketing expense was $172.3 million for the nine months ended October
31, 2021, relatively consistent compared to $171.2 million for the nine months
ended October 31, 2020. The increase of $1.1 million or 1% reflected a $4.0
million increase in costs to obtain revenue contracts, a $2.0 million increase
in depreciation expense, and a $1.5 million increase in advertising costs
associated with certain brand media campaigns. These increases were largely
offset by a $5.5 million decrease in stock-based compensation expense, which is
lower in the current period reflecting the impact of certain departures of
senior management in the prior periods.
Research and development expense was $50.3 million for the nine months ended
October 31, 2021, compared to $43.6 million for the nine months ended October
31, 2020, an increase of $6.7 million or 15%. The increase was primarily driven
by a $3.2 million increase in stock-based compensation expense given employee
stock grants, a $1.3 million increase in personnel-related costs, as well as a
$0.6 million increase in depreciation expense.
General and administrative expense was $61.3 million for the nine months ended
October 31, 2021, compared to $58.0 million for the nine months ended October
31, 2020, an increase of $3.3 million or 6%. The increase was primarily driven
by a $1.4 million increase in stock-based compensation given employee stock
grants, a $1.2 million increase in personnel-related costs, as well as a $0.7
million increase in depreciation expense. This was partially offset by a
$1.6 million decrease in bad debt expense as the prior year period had higher
expense to reflect the initial impacts of the COVID-19 pandemic.
Net Loss
Net loss was $24.9 million and $70.1 million for the three and nine months ended
October 31, 2021, respectively and $22.0 million and $76.4 million for the three
and nine months ended October 31, 2020, respectively.
Non-GAAP Net Loss
In addition to our financial results determined in accordance with GAAP, we
believe that non-GAAP net loss is useful in evaluating our operating performance
and our business.
Non-GAAP net loss is a financial measure that is not calculated in accordance
with GAAP. We define non-GAAP net loss as our GAAP net loss as adjusted to
exclude the effects of stock-based compensation expense. We believe non-GAAP net
loss provides
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investors and other users of our financial information consistency and
comparability with our past financial performance and facilitates
period-to-period comparisons of our results of operations. We also believe
non-GAAP net loss is useful in evaluating our operating performance compared to
that of other companies in our industry, as it eliminates the effects of
stock-based compensation, which may vary for reasons unrelated to overall
operating performance.
We use non-GAAP net loss in conjunction with traditional GAAP net loss as part
of our overall assessment of our performance, including the preparation of our
annual operating budget and quarterly forecasts, and to evaluate the
effectiveness of our business strategies. Our definition may differ from the
definitions used by other companies and therefore comparability may be limited.
In addition, other companies may not publish this or similar metrics. Thus, our
non-GAAP net loss should be considered in addition to, not as a substitute for,
nor superior to or in isolation from, measures prepared in accordance with GAAP.
Non-GAAP net loss may be limited in its usefulness because it does not present
the full economic effect of our use of stock-based compensation expense. We
compensate for these limitations by providing a reconciliation of non-GAAP net
loss to the most closely related GAAP financial measure. We encourage investors
and others to review our financial information in its entirety, not to rely on
any single financial measure and to view non-GAAP net loss in conjunction with
GAAP net loss.
The following table provides a reconciliation of GAAP net loss to non-GAAP net
loss:
                                         Three months ended October 31,                Nine months ended October 31,
(in thousands)                             2021                    2020                   2021                  2020
Net loss                            $        (24,926)         $   (22,041)         $       (70,149)         $  (76,381)
Plus: Stock-based compensation
expense                                       19,455               19,287                   54,455              53,889
Non-GAAP net loss                   $         (5,471)         $    (2,754)         $       (15,694)         $  (22,492)


Liquidity and Capital Resources
As of October 31, 2021, our principal sources of liquidity were cash and cash
equivalents of $229.5 million. We believe our existing cash and cash equivalents
will be sufficient to meet our projected operating requirements for at least the
next 12 months. Our cash flows, including net cash used in or provided by
operating activities, may vary significantly from quarter to quarter, due to the
timing of billings, cash collections and lease payments, significant marketing
events and related expenses, and the potential effects of the COVID-19 pandemic,
among other factors.
Our future capital requirements will depend on many factors, including those set
forth under "Risk Factors." We may in the future enter into arrangements to
acquire or invest in complementary businesses, services, technologies, and
intellectual property rights. In addition, we may be required to seek additional
equity or debt financing. In the event that additional financing is required
from outside sources, we may not be able to raise it on terms acceptable to us
or at all. If we are unable to raise additional capital when desired, our
business, operating results and financial condition would be adversely affected.
Credit Arrangements
On March 11, 2020, we entered into a new credit agreement with Silicon Valley
Bank (the "Credit Agreement"). No significant debt issuance costs were incurred
in association with the Credit Agreement. In January 2021, we amended the Credit
Agreement which modified the conditions pursuant to which subsidiaries are
required to become guarantors.
The Credit Agreement provides for a senior secured revolving loan facility of up
to $50.0 million that matures three years after the effective date, with the
right subject to certain conditions to add an incremental revolving loan
facility of up to $50.0 million in the aggregate. The three-year revolving loan
facility provides for borrowings up to the amount of the facility with
sub-limits of up to (i) $30.0 million to be available for the issuance of
letters of credit and (ii) $10.0 million to be available for swingline loans.
Under the Credit Agreement, loans bear interest, at our option, at an annual
rate based on LIBOR or a base rate. Loans based on LIBOR shall bear interest at
a rate between LIBOR plus 2.50% and LIBOR plus 3.00%, depending on our average
daily usage of the revolving loan facility. Loans based on the base rate shall
bear interest at a rate between the base rate minus 0.50% and the base rate plus
0.00%, depending on our average daily usage of the revolving loan facility. See
Part II Item 1A "Risk Factors - Our credit facility contains restrictive
covenants that may limit our operating flexibility" for discussion of LIBOR
being phased out.
The obligations under the Credit Agreement are secured by a lien on
substantially all of our tangible and intangible property and by a pledge of all
of our equity interests of material direct and indirect domestic subsidiaries
and 66% of each class of capital stock of any material first-tier foreign
subsidiaries, subject to limited exceptions.
The Credit Agreement contains customary affirmative and negative covenants and
restrictions, as well as financial covenants that require us to maintain the
year-over-year growth rate of its ordinary course recurring revenue for a
trailing four fiscal quarter period above specified rates when certain liquidity
thresholds are not met and to maintain a consolidated quick ratio of at least
1.50 to 1.00 tested on a monthly basis.
    As of October 31, 2021, we were in compliance with all debt covenants. As of
such date, the $50.0 million revolving loan facility had $35.7 million available
and $14.3 million in letters of credit allocated as security in connection with
office space.
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Cash Flows
The following table summarizes our cash flows:
                                                    Nine months ended October 31,
(in thousands)                                           2021               

2020

 Net cash used in operating activities       $        (7,275)               

$ (23 722)

 Net cash used in investing activities       $       (12,333)               

$ (53,946)

 Net cash provided by financing activities   $        19,665                

$ 17,087


Operating Activities
Net cash used in operating activities of $7.3 million for the nine months ended
October 31, 2021 was primarily due to the net loss of $70.1 million, as well as
changes in unearned revenue of $39.4 million and costs to obtain revenue
contracts of $8.7 million, partially offset by changes in accounts receivable of
$34.3 million, mainly due to timing of billing and cash collections during the
period. Net cash used in operating activities was also partially offset by
non-cash charges related to stock-based compensation expense of $54.5 million,
depreciation and amortization expense of $12.5 million, and amortization of
operating lease right-of-use assets of $6.9 million.
Net cash used in operating activities of $23.7 million for the nine months ended
October 31, 2020 was primarily due to the net loss of $76.4 million, as well as
changes in unearned revenue of $49.6 million, changes in accounts payable,
accrued expenses and other current liabilities of $7.2 million and prepaid
expenses and other current assets of $5.0 million respectively, associated with
the timing of invoices and payments. This was partially offset by positive
adjustments in reconciling our net loss to net cash used in operating activities
related to changes in accounts receivable of $30.3 million, mainly due to timing
of billing and cash collections during the period, as well as changes in costs
to obtain revenue contracts of $4.7 million, other long term liabilities of $4.5
million, and operating lease liabilities of $2.5 million. Net cash used in
operating activities was also partially offset by non-cash charges related to
stock-based compensation expense of $53.9 million, amortization of operating
lease right-of-use assets of $9.4 million, depreciation and amortization expense
of $7.5 million, and bad debt expense of $2.4 million which includes an increase
in the allowance for doubtful accounts relating to extended billing and payment
terms with certain customers and considerations in light of impacts from the
COVID-19 pandemic.
Investing Activities
Net cash used in investing activities of $12.3 million for the nine months ended
October 31, 2021 reflected capital expenditures associated with our new office
spaces, primarily our new corporate headquarters in New York, NY.
Net cash used in investing activities of $53.9 million for the nine months ended
October 31, 2020 reflected capital expenditures primarily associated with our
new corporate headquarters in New York, NY, and our office spaces in Rosslyn, VA
and Tokyo, Japan, among others.
Financing Activities
Net cash provided by financing activities of $19.7 million for the nine months
ended October 31, 2021 was primarily related to proceeds from exercise of stock
options of $15.9 million and net proceeds from employee stock purchase plan
withholdings of $4.1 million, partially offset by payments of deferred financing
costs of $0.3 million.
Net cash provided by financing activities of $17.1 million for the nine months
ended October 31, 2020 was primarily related to proceeds from exercise of stock
options of $13.1 million and net proceeds from employee stock purchase plan
withholdings of $4.8 million, partially offset by payments of deferred financing
costs of $0.9 million.
Contractual Obligations
We are obligated to make payments under certain non-cancelable contractual
obligations in the normal course of business. Our contractual obligations
primarily relate to our operating lease arrangements for office space. Our other
contractual obligations include contracts with our Knowledge Network application
providers, which generally have a term of one year, although some have a term of
several years, as well as contracts with our software vendors, among others.
These obligations represent minimum contractual payments, or our best estimate
for variable elements based on historical payments. Our contractual obligations
have various expiry dates between fiscal years 2022 and 2035.
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From October 31, 2021, the future minimum payments under these contractual obligations are as follows (in thousands): January 31: Operating leases Other 2022 (rest of the year) $

           4,861      $ 10,900
2023                                            19,234        17,133
2024                                            18,752         9,697
2025                                            18,210         2,089
2026                                            18,944         1,839
2027 and thereafter                             92,622         1,937
Total                                $         172,623      $ 43,595


See Note 13 "Commitments and Contingencies" to our condensed consolidated
financial statements for further discussion on contractual obligations.
Off-Balance Sheet Arrangements
We do not engage in transactions that generate relationships with unconsolidated
entities or financial partnerships, such as entities often referred to as
structured finance or special purpose entities, as part of our ongoing business.
Accordingly, our operating results, financial condition and cash flows are not
subject to off-balance sheet risks.
Critical Accounting Policies and Estimates
Our management's discussion and analysis of our financial condition and results
of operations is based on our financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States of
America ("GAAP"). The preparation of these financial statements requires us to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements, as well as the reported revenue generated and
expenses incurred during the reporting periods. Our estimates are based on our
historical experience and various other factors that we believe are reasonable
under the circumstances, the results of which form the basis for making
judgments about items that are not readily apparent from other sources. Actual
results may differ from these estimates under different assumptions or
conditions.
There have been no material changes to our critical accounting policies and
estimates as compared to those disclosed in our Annual Report on Form 10-K.
Recent Accounting Pronouncements
See Note 2 "Summary of Significant Accounting Policies- Recent Accounting
Pronouncements", to the condensed consolidated financial statements for our
discussion about adopted and pending recent accounting pronouncements.
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