Revenue increased 42% year-over-year
ARR up 43% year-over-year
SentinelOne, Inc. (NYSE: S) today announced financial results
for the third quarter of fiscal year 2024 ended October 31,
2023.
“Our third quarter performance exceeded our top and bottom line
expectations, delivering industry-leading growth and margin
improvement,” said Tomer Weingarten, CEO of SentinelOne. “Our
market-leading, AI-based security across endpoint, cloud, and data
continues to differentiate SentinelOne as a true innovator. The
increasing velocity and complexity of cyber attacks require a new
approach to cyber security. We are delivering a modern,
enterprise-wide unified security platform, helping enterprises
manage risk and stay ahead of evolving threats now and into the
future.”
“We delivered strong top-line growth and substantial margin
expansion, showcasing the scale and breadth of our Singularity
platform. Our gross margin reached a new record, and we achieved
our ninth consecutive quarter of over 25 percentage points of
year-over-year operating margin improvement,” said Dave Bernhardt,
CFO of SentinelOne. “Building on our third quarter outperformance,
we are again raising our top and bottom line expectations for the
fiscal year ‘24.”
Letter to Shareholders
We have published a letter to shareholders on the Investor
Relations section of our website at investors.sentinelone.com. The
letter provides further discussion of our results for the third
quarter of fiscal year 2024 as well as the financial outlook for
our fiscal fourth quarter and full fiscal year 2024.
Third Quarter Fiscal Year 2024 Highlights (All metrics
are compared to the third quarter of fiscal year 2023 unless
otherwise noted)
- Total revenue increased 42% to $164.2 million, compared
to $115.3 million.
- Annualized recurring revenue (ARR) increased 43% to
$663.9 million as of October 31, 2023.
- Total customer count grew to over 11,500 customers as of
October 31, 2023. Customers with ARR of $100,000 or more grew 33%
to 1,060 as of October 31, 2023. Dollar-based net revenue retention
rate (NRR) exceeded 115%.
- Gross margin: GAAP gross margin was 73%, compared to
64%. Non-GAAP gross margin was 79%, compared to 71%.
- Operating margin: GAAP operating margin was (50)%,
compared to (90)%. Non-GAAP operating margin was (11)%, compared to
(43)%.
- Cash flow margin: Operating cash flow margin was (14)%,
compared to (52%). Free cash flow margin was (16)%, 40 percentage
points higher compared to (56)%.
- Cash, cash equivalents, and investments were $1.1
billion as of October 31, 2023.
Financial Outlook
We are providing the following guidance for the fourth quarter
of fiscal year 2024, and for fiscal year 2024 (ending January 31,
2024).
Q4FY24
Guidance
Full FY2024
Guidance
Revenue
$169 million
$616 million
Non-GAAP gross margin
77.5%
77%
Non-GAAP operating margin
(14)%
(20)%
These statements are forward-looking and actual results may
differ materially as a result of many factors. Refer to the below
for information on the factors that could cause our actual results
to differ materially from these forward-looking statements.
Guidance for non-GAAP financial measures excludes stock-based
compensation expense, employer payroll tax on employee stock
transactions, amortization expense of acquired intangible assets,
acquisition-related compensation costs, restructuring charges, and
gains and losses on strategic investments. We have not provided the
most directly comparable GAAP measures because certain items are
out of our control or cannot be reasonably predicted. Accordingly,
a reconciliation of non-GAAP gross margin and non-GAAP operating
margin is not available without unreasonable effort.
Webcast Information
We will host a live audio webcast for analysts and investors to
discuss our earnings results for the third quarter of fiscal year
2024 and outlook for fourth quarter of fiscal year 2024 and full
fiscal year 2024 today, December 5, 2023, at 2:00 p.m. Pacific Time
(5:00 p.m. Eastern Time). The live webcast and a recording of the
event will be available on the Investor Relations section of our
website at investors.sentinelone.com.
We have used, and intend to continue to use, the Investor
Relations section of our website at investors.sentinelone.com as a
means of disclosing material nonpublic information and for
complying with our disclosure obligations under Regulation FD.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which statements involve risks and uncertainties,
including but not limited to statements regarding our future
growth, execution, competitive position, and future financial and
operating performance, including our financial outlook for the
fourth quarter of fiscal year 2024 and our full fiscal year 2024,
including non-GAAP gross profit and non-GAAP operating margin;
progress towards our long-term profitability targets; and general
market trends. The words “believe,” “may,” “will,” “potentially,”
“estimate,” “continue,” “anticipate,” “intend,” “could,” “would,”
“project,” “target,” “plan,” “expect,” or the negative of these
terms and similar expressions are intended to identify
forward-looking statements. However, not all forward-looking
statements contain these identifying words.
There are a significant number of factors that could cause our
actual results to differ materially from statements made in this
press release, including but not limited to: our limited operating
history; our history of losses; intense competition in the market
we compete in; fluctuations in our operating results; actual or
perceived network or security incidents against us; our ability to
successfully integrate any acquisitions and strategic investments;
actual or perceived defects, errors or vulnerabilities in our
platform; risks associated with managing our rapid growth; general
market, political, economic, and business conditions, including
those related to declining global macroeconomic conditions,
government shutdowns, rising interest rates, supply chain
disruptions and inflation, labor shortages, recent banking sector
issues, uncertainty with respect to the federal budget, and
geopolitical uncertainty, including the effects of the conflicts in
Israel and Ukraine and the judicial reform in Israel; our ability
to attract new and retain existing customers, or renew and expand
our relationships with them; the ability of our platform to
effectively interoperate within our customers'' IT infrastructure;
disruptions or other business interruptions that affect the
availability of our platform including cybersecurity incidents; the
failure to timely develop and achieve market acceptance of new
products and subscriptions as well as existing products,
subscriptions and support offerings; rapidly evolving technological
developments in the market for security products and subscription
and support offerings; length of sales cycles; and risks of
securities class action litigation.
Additional risks and uncertainties that could affect our
financial results are included under the captions “Risk Factors”
and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” set forth in our filings and reports
with the Securities and Exchange Commission (“SEC”), including our
most recently filed Annual Report on Form 10-K, dated March 29,
2023, subsequent Quarterly Reports on Form 10-Q and other filings
and reports that we may file from time to time with the SEC, copies
of which are available on our website at investors.sentinelone.com
and on the SEC’s website at www.sec.gov.
You should not rely on these forward-looking statements, as
actual outcomes and results may differ materially from those
contemplated by these forward-looking statements as a result of
such risks and uncertainties. All forward-looking statements in
this press release are based on information and estimates available
to us as of the date hereof, and were based on current
expectations, estimates, forecasts, and projections as well as the
beliefs and assumptions of management. We do not assume any
obligation to update the forward-looking statements provided to
reflect events that occur or circumstances that exist after the
date of this press release or to reflect new information or the
occurrence of unexpected events, except as required by law. We may
not actually achieve the plans, intentions, or expectations
disclosed in our forward-looking statements, and you should not
place undue reliance on our forward-looking statements.
Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP,
we believe the following non-GAAP measures are useful in evaluating
our operating performance. We use the following non-GAAP financial
information to evaluate our ongoing operations and for internal
planning and forecasting purposes. We believe that non-GAAP
financial information, when taken collectively, with the financial
information presented in accordance with GAAP, may be helpful to
investors because it provides consistency and comparability with
past financial performance. However, non-GAAP financial information
is presented for supplemental informational purposes only, has
limitations as an analytical tool, and should not be considered in
isolation or as a substitute for financial information presented in
accordance with GAAP.
Other companies, including companies in our industry, may
calculate similarly titled non-GAAP measures differently or may use
other measures to evaluate their performance, all of which could
reduce the usefulness of our non-GAAP financial measures as tools
for comparison. In addition, the utility of free cash flow as a
measure of our liquidity is limited as it does not represent the
total increase or decrease in our cash balance for a given
period.
Reconciliations between non-GAAP financial measures to the most
directly comparable financial measure stated in accordance with
GAAP are contained below. Investors are encouraged to review the
related GAAP financial measures and the reconciliation of these
non-GAAP financial measures to their most directly comparable GAAP
financial measures and not rely on any single financial measure to
evaluate our business.
As presented in the “Reconciliation of GAAP to Non-GAAP
Financial Information” table below, each of the non-GAAP financial
measures excludes one or more of the following items:
Stock-based compensation expense
Stock-based compensation expense is a non-cash expense that
varies in amount from period to period and is dependent on market
forces that are often beyond our control. As a result, management
excludes this item from our internal operating forecasts and
models. Management believes that non-GAAP measures adjusted for
stock-based compensation expense provide investors with a basis to
measure our core performance against the performance of other
companies without the variability created by stock-based
compensation as a result of the variety of equity awards used by
other companies and the varying methodologies and assumptions
used.
Employer payroll tax on employee stock transactions
Employer payroll tax expense related to employee stock
transactions are tied to the vesting or exercise of underlying
equity awards and the price of our common stock at the time of
vesting, which varies in amount from period to period and is
dependent on market forces that are often beyond our control. As a
result, management excludes this item from our internal operating
forecasts and models. Management believes that non-GAAP measures
adjusted for employer payroll taxes on employee stock transactions
provide investors with a basis to measure our core performance
against the performance of other companies without the variability
created by employer payroll taxes on employee stock transactions as
a result of the stock price at the time of employee exercise.
Amortization of acquired intangible assets
Amortization of acquired intangible assets expense are tied to
the intangible assets that were acquired in conjunction with
acquisitions, which results in non‑cash expenses that may not
otherwise have been incurred. Management believes excluding the
expense associated with intangible assets from non-GAAP measures
allows for a more accurate assessment of our ongoing operations and
provides investors with a better comparison of period-over-period
operating results.
Acquisition-related compensation costs
Acquisition-related compensation costs include cash-based
compensation expense resulting from the employment retention of
certain employees established in accordance with the terms of the
acquisition of Attivo Networks, Inc. in May 2022 (the Attivo
acquisition). Acquisition-related cash-based compensation costs
have been excluded as they were specifically negotiated as part of
the Attivo acquisition in order to retain such employees and relate
to cash compensation that was made either in lieu of stock-based
compensation or where the grant of stock-based compensation awards
was not practicable. In most cases, these acquisition-related
compensation costs are not factored into management's evaluation of
potential acquisitions or our performance after completion of
acquisitions, because they are not related to our core operating
performance. In addition, the frequency and amount of such charges
can vary significantly based on the size and timing of acquisitions
and the maturities of the businesses being acquired. Excluding
acquisition-related compensation costs from non-GAAP measures
provides investors with a basis to compare our results against
those of other companies without the variability caused by purchase
accounting.
Restructuring charges
Restructuring charges primarily relate to severance payments,
employee benefits, stock-based compensation, and inventory
write-offs. These restructuring charges are excluded from non-GAAP
financial measures because they are the result of discrete events
that are not considered core-operating activities. We believe that
it is appropriate to exclude restructuring charges from non-GAAP
financial measures because it enables the comparison of
period-over-period operating results from continuing
operations.
Gains and losses on strategic investments
Gains and losses on strategic investments relate to the
subsequent changes in fair value of our strategic investments.
These gains and losses are excluded from non-GAAP financial
measures because they are the result of discrete events that are
not considered core-operating activities. We believe that it is
appropriate to exclude gains and losses from strategic investments
from non-GAAP financial measures because it enables the comparison
of period-over-period net income (loss).
Income tax provision (benefit)
We believe that excluding the tax benefit associated with the
partial reversal of the valuation allowance against our deferred
tax assets for the second quarter of fiscal year 2023 provides our
senior management as well as other users of our financial
statements with a valuable perspective on the performance and
health of the business. This partial reversal relates to
realization of our deferred tax assets used to offset deferred tax
liabilities recorded in the Attivo acquisition. This one-time
benefit is not indicative of current or future operations and
expenses.
Non-GAAP Cost of Revenue, Non-GAAP Gross Profit, Non-GAAP
Gross Margin, Non-GAAP Loss from Operations, Non-GAAP Operating
Margin, Non-GAAP Net Loss and Non-GAAP Net Loss Per Share
We define these non-GAAP financial measures as their respective
GAAP measures, excluding the expenses referenced above. We use
these non-GAAP financial 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.
Free Cash Flow
We define free cash flow as cash used in operating activities
less purchases of property and equipment and capitalized
internal-use software costs. We believe free cash flow is a useful
indicator of liquidity that provides our management, board of
directors, and investors with information about our future ability
to generate or use cash to enhance the strength of our balance
sheet and further invest in our business and pursue potential
strategic initiatives.
Key Business Metrics
We monitor the following key metrics to help us evaluate our
business, identify trends affecting our business, formulate
business plans, and make strategic decisions.
Annualized Recurring Revenue
We believe that ARR is a key operating metric to measure our
business because it is driven by our ability to acquire new
subscription and capacity customers and to maintain and expand our
relationship with existing customers. ARR represents the annualized
revenue run rate of our subscription and capacity contracts at the
end of a reporting period, assuming contracts are renewed on their
existing terms for customers that are under contracts with us. ARR
is not a forecast of future revenue, which can be impacted by
contract start and end dates and renewal rates. As discussed above,
in the first quarter of fiscal year 2024, we adjusted our
historical ARR. The adjustment to ARR did not impact historical
total bookings or revenue. Further information relating to this
adjustment can be found in “Item 2. Management’s Discussion and
Analysis of Financial Condition and Results of Operations, Key
Business Metrics” in our Quarterly Report on Form 10-Q filed with
the SEC on June 1, 2023.
Customers with ARR of $100,000 or More
We believe that our ability to increase the number of customers
with ARR of $100,000 or more is an indicator of our market
penetration and strategic demand for our platform. We define a
customer as an entity that has an active subscription for access to
our platform. We count Managed Service Providers, Managed Security
Service Providers, Managed Detection & Response firms, and
Original Equipment Manufacturers, who may purchase our products on
behalf of multiple companies, as a single customer. We do not count
our reseller or distributor channel partners as customers. Based on
the adjustments to ARR described above, customers with ARR of
$100,000 or more for the prior periods in fiscal year 2023
presented above has been adjusted based on the same percentage
adjustment rate identified in the first quarter of fiscal year
2024.
Dollar-Based Net Retention Rate (NRR)
We believe that our ability to retain and expand our revenue
generated from our existing customers is an indicator of the
long-term value of our customer relationships and our potential
future business opportunities. Dollar-based net retention rate
measures the percentage change in our ARR derived from our customer
base at a point in time. To calculate these metrics, we first
determine Prior Period ARR, which is ARR from the population of our
customers as of 12 months prior to the end of a particular
reporting period. We calculate Net Retention ARR as the total ARR
at the end of a particular reporting period from the set of
customers that is used to determine Prior Period ARR. Net Retention
ARR includes any expansion, and is net of contraction and attrition
associated with that set of customers. NRR is the quotient obtained
by dividing Net Retention ARR by Prior Period ARR.
Source: SentinelOne NYSE: S Category: Investors
SENTINELONE, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands)
(unaudited)
October 31,
January 31,
2023
2023
Assets
Current assets:
Cash and cash equivalents
$
127,340
$
137,941
Short-term investments
670,632
485,584
Accounts receivable, net
133,828
151,492
Deferred contract acquisition costs,
current
45,853
37,904
Prepaid expenses and other current
assets
91,770
101,812
Total current assets
1,069,423
914,733
Property and equipment, net
46,015
38,741
Operating lease right-of-use assets
20,969
23,564
Long-term investments
325,164
535,422
Deferred contract acquisition costs,
non-current
60,178
55,536
Intangible assets, net
127,151
145,093
Goodwill
540,308
540,308
Other assets
6,659
5,516
Total assets
$
2,195,867
$
2,258,913
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
13,793
$
11,214
Accrued liabilities
99,867
100,015
Accrued payroll and benefits
52,777
54,955
Operating lease liabilities, current
4,448
3,895
Deferred revenue, current
327,941
303,200
Total current liabilities
498,826
473,279
Deferred revenue, non-current
94,631
103,062
Operating lease liabilities,
non-current
18,492
23,079
Other liabilities
3,089
2,788
Total liabilities
615,038
602,208
Stockholders’ equity:
Class A common stock
25
21
Class B common stock
5
8
Additional paid-in capital
2,855,205
2,663,394
Accumulated other comprehensive loss
(7,344
)
(6,367
)
Accumulated deficit
(1,267,062
)
(1,000,351
)
Total stockholders’ equity
1,580,829
1,656,705
Total liabilities and stockholders’
equity
$
2,195,867
$
2,258,913
SENTINELONE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except share
and per share data)
(unaudited)
Three Months Ended October
31,
Nine Months Ended October
31,
2023
2022
2023
2022
Revenue
$
164,165
$
115,323
$
446,979
$
296,083
Cost of revenue(1)
43,765
41,006
131,015
104,406
Gross profit
120,400
74,317
315,964
191,677
Operating expenses:
Research and development(1)
52,306
52,234
161,730
153,104
Sales and marketing(1)
98,249
83,953
295,682
223,594
General and administrative(1)
51,239
42,188
151,425
117,525
Restructuring(1)
74
—
4,329
—
Total operating expenses
201,868
178,375
613,166
494,223
Loss from operations
(81,468
)
(104,058
)
(297,202
)
(302,546
)
Interest income
11,877
7,193
33,901
11,502
Interest expense
(1
)
(613
)
(1,213
)
(1,225
)
Other expense, net
605
(781
)
1,655
(645
)
Loss before income taxes
(68,987
)
(98,259
)
(262,859
)
(292,914
)
Provision (benefit) for income taxes
1,317
599
3,852
(7,916
)
Net loss
$
(70,304
)
$
(98,858
)
$
(266,711
)
$
(284,998
)
Net loss per share attributable to Class A
and Class B common stockholders, basic and diluted
$
(0.24
)
$
(0.35
)
$
(0.91
)
$
(1.03
)
Weighted-average shares used in computing
net loss per share attributable to Class A and Class B common
stockholders, basic and diluted
296,650,848
280,635,022
292,755,742
275,867,765
(1) Includes stock-based compensation
expense as follows:
Cost of revenue
$
4,329
$
2,835
$
12,570
$
7,082
Research and development
15,634
13,996
45,876
37,954
Sales and marketing
14,085
12,166
40,362
28,977
General and administrative
20,865
16,690
65,560
44,305
Restructuring
—
—
(1,060
)
—
Total stock-based compensation expense
$
54,913
$
45,687
$
163,308
$
118,318
SENTINELONE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Nine Months Ended October
31,
2023
2022
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss
$
(266,711
)
$
(284,998
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
28,549
20,097
Amortization of deferred contract
acquisition costs
34,699
25,871
Non-cash operating lease costs
3,010
2,547
Stock-based compensation expense
163,308
118,318
Loss on investments, accretion of
discounts, and amortization of premiums on investments, net
(16,289
)
(5,620
)
Net gain on strategic investments
(2,706
)
—
Other
637
(446
)
Changes in operating assets and
liabilities, net of effects of acquisition
Accounts receivable
18,846
(12,699
)
Prepaid expenses and other assets
10,075
(11,072
)
Deferred contract acquisition costs
(47,289
)
(38,163
)
Accounts payable
1,935
(1,377
)
Accrued liabilities
(220
)
261
Accrued payroll and benefits
(1,998
)
(18,786
)
Operating lease liabilities
(4,650
)
(4,296
)
Deferred revenue
16,311
40,609
Other liabilities
301
(1,464
)
Net cash used in operating activities
(62,192
)
(171,218
)
CASH FLOW FROM INVESTING ACTIVITIES:
Purchases of property and equipment
(1,117
)
(4,827
)
Purchases of intangible assets
(3,436
)
(247
)
Capitalization of internal-use
software
(9,687
)
(10,279
)
Purchases of investments
(462,539
)
(1,728,162
)
Sales and maturities of investments
504,340
778,555
Cash paid for acquisition, net of cash and
restricted cash acquired
—
(281,032
)
Net cash provided by (used in) investing
activities
27,561
(1,245,992
)
CASH FLOW FROM FINANCING ACTIVITIES:
Payments of deferred offering costs
—
(186
)
Proceeds from exercise of stock
options
17,366
11,282
Proceeds from issuance of common stock
under the employee stock purchase plan
6,416
8,682
Net cash provided by financing
activities
23,782
19,778
NET CHANGE IN CASH, CASH EQUIVALENTS, AND
RESTRICTED CASH
(10,849
)
(1,397,432
)
CASH, CASH EQUIVALENTS, AND RESTRICTED
CASH–Beginning of period
202,406
1,672,051
CASH, CASH EQUIVALENTS, AND RESTRICTED
CASH–End of period
$
191,557
$
274,619
SENTINELONE, INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL INFORMATION
(in thousands, except
percentages and per share data)
(unaudited)
Three Months Ended October
31,
Nine Months Ended October
31,
2023
2022
2023
2022
Cost of revenue reconciliation:
GAAP cost of revenue
$
43,765
$
41,006
$
131,015
$
104,406
Stock-based compensation expense
(4,329
)
(2,835
)
(12,570
)
(7,082
)
Employer payroll tax on employee stock
transactions
(114
)
(14
)
(240
)
(50
)
Amortization of acquired intangible
assets
(5,139
)
(5,139
)
(15,250
)
(10,818
)
Acquisition-related compensation
(128
)
(146
)
(379
)
(294
)
Inventory write-offs due to
restructuring
—
—
(720
)
$
—
Non-GAAP cost of revenue
$
34,055
$
32,872
$
101,856
$
86,162
Gross profit reconciliation:
GAAP gross profit
$
120,400
$
74,317
$
315,964
$
191,677
Stock-based compensation expense
4,329
2,835
12,570
7,082
Employer payroll tax on employee stock
transactions
114
14
240
50
Amortization of acquired intangible
assets
5,139
5,139
15,250
10,818
Acquisition-related compensation
128
146
379
294
Inventory write-offs due to
restructuring
—
—
720
—
Non-GAAP gross profit
$
130,110
$
82,451
$
345,123
$
209,921
Gross margin reconciliation:
GAAP gross margin
73
%
64
%
71
%
65
%
Stock-based compensation expense
3
%
2
%
3
%
2
%
Employer payroll tax on employee stock
transactions
—
%
—
%
—
%
—
%
Amortization of acquired intangible
assets
3
%
4
%
3
%
4
%
Acquisition-related compensation
—
%
—
%
—
%
—
%
Inventory write-offs due to
restructuring
—
%
—
%
—
%
—
%
Non-GAAP gross margin
79
%
71
%
77
%
71
%
Research and development expense
reconciliation:
GAAP research and development expense
$
52,306
$
52,234
$
161,730
$
153,104
Stock-based compensation expense
(15,634
)
(13,996
)
(45,876
)
(37,954
)
Employer payroll tax on employee stock
transactions
(116
)
(29
)
(467
)
(164
)
Acquisition-related compensation
(297
)
(368
)
(920
)
(727
)
Non-GAAP research and development
expense
$
36,259
$
37,841
$
114,467
$
114,259
Sales and marketing expense
reconciliation:
GAAP sales and marketing expense
$
98,249
$
83,953
$
295,682
$
223,594
Stock-based compensation expense
(14,085
)
(12,166
)
(40,362
)
(28,977
)
Employer payroll tax on employee stock
transactions
(177
)
(99
)
(751
)
(378
)
Amortization of acquired intangible
assets
(1,955
)
(2,144
)
(5,816
)
(4,470
)
Acquisition-related compensation
(125
)
(539
)
(538
)
(1,074
)
Non-GAAP sales and marketing expense
$
81,907
$
69,005
$
248,215
$
188,695
General and administrative expense
reconciliation:
GAAP general and administrative
expense
$
51,239
$
42,188
$
151,425
$
117,525
Stock-based compensation expense
(20,865
)
(16,690
)
(65,560
)
(44,305
)
Employer payroll tax on employee stock
transactions
(242
)
56
(668
)
(393
)
Amortization of acquired intangible
assets
—
(19
)
(2
)
(56
)
Acquisition-related compensation
(2
)
(343
)
(383
)
(679
)
Non-GAAP general and administrative
expense
$
30,130
$
25,192
$
84,812
$
72,092
Restructuring expense
reconciliation:
GAAP restructuring expense
$
74
$
—
$
4,329
$
—
Severance and employee benefits
(74
)
—
(5,389
)
—
Stock-based compensation expense
—
—
1,060
—
Non-GAAP restructuring expense
$
—
$
—
$
—
$
—
Operating loss reconciliation:
GAAP operating loss
$
(81,468
)
$
(104,058
)
$
(297,202
)
$
(302,546
)
Stock-based compensation expense
54,913
45,687
163,308
118,318
Employer payroll tax on employee stock
transactions
649
86
2,126
985
Amortization of acquired intangible
assets
7,094
7,302
21,068
15,344
Acquisition-related compensation
552
1,396
2,220
2,774
Inventory write-offs due to
restructuring
—
—
720
—
Severance and employee benefits
74
—
5,389
—
Non-GAAP operating loss
$
(18,186
)
$
(49,587
)
$
(102,371
)
$
(165,125
)
Operating margin
reconciliation:
GAAP operating margin
(50
)%
(90
)%
(66
)%
(102
)%
Stock-based compensation expense
33
%
40
%
37
%
40
%
Employer payroll tax on employee stock
transactions
—
%
—
%
—
%
—
%
Amortization of acquired intangible
assets
4
%
6
%
5
%
5
%
Acquisition-related compensation
—
%
1
%
—
%
1
%
Inventory write-offs due to
restructuring
—
%
—
%
—
%
—
%
Severance and employee benefits
—
%
—
%
1
%
—
%
Non-GAAP operating margin*
(11
)%
(43
)%
(23
)%
(56
)%
Net loss reconciliation:
GAAP net loss
$
(70,304
)
$
(98,858
)
$
(266,711
)
$
(284,998
)
Stock-based compensation expense
54,913
45,687
163,308
118,318
Employer payroll tax on employee stock
transactions
649
86
2,126
985
Amortization of acquired intangible
assets
7,094
7,302
21,068
15,344
Acquisition-related compensation
552
1,396
2,220
2,774
Inventory write-offs due to
restructuring
—
—
720
—
Severance and employee benefits
74
—
5,389
—
Gain on strategic investments
(703
)
—
(2,703
)
—
Income tax provision (benefit)
—
—
—
(9,667
)
Non-GAAP net loss
$
(7,725
)
$
(44,387
)
$
(74,583
)
$
(157,244
)
Basic and diluted EPS
reconciliation:
GAAP net loss per share, basic and
diluted
$
(0.24
)
$
(0.35
)
$
(0.91
)
$
(1.03
)
Stock-based compensation expense
0.19
0.16
0.56
0.43
Employer payroll tax on employee stock
transactions
—
—
0.01
—
Amortization of acquired intangible
assets
0.02
0.03
0.07
0.06
Acquisition-related compensation
—
—
0.01
0.01
Inventory write-offs due to
restructuring
—
—
—
—
Severance and employee benefits
—
—
0.02
—
Gain on strategic investments
—
—
(0.01
)
—
Income tax provision (benefit)
—
—
—
(0.04
)
Non-GAAP net loss per share, basic and
diluted*
$
(0.03
)
$
(0.16
)
$
(0.25
)
$
(0.57
)
*Certain figures may not sum due to rounding.
SENTINELONE, INC.
SELECTED CASH FLOW
INFORMATION
(in thousands)
(unaudited)
Reconciliation of cash used in
operating activities to free cash flow
Three Months Ended October
31,
Nine Months Ended October
31,
2023
2022
2023
2022
GAAP net cash used in operating
activities
$
(22,230
)
$
(59,741
)
$
(62,192
)
$
(171,218
)
Less: Purchases of property and
equipment
(623
)
(726
)
(1,117
)
(4,827
)
Less: Capitalized internal-use
software
(3,522
)
(4,251
)
(9,687
)
(10,279
)
Free cash flow
$
(26,375
)
$
(64,718
)
$
(72,996
)
$
(186,324
)
Net cash provided by (used in) investing
activities
$
12,853
$
(2,888
)
$
27,561
$
(1,245,992
)
Net cash provided by financing
activities
$
3,521
$
2,900
$
23,782
$
19,778
Operating cash flow margin
(14
)%
(52
)%
(14
)%
(58
)%
Free cash flow margin
(16
)%
(56
)%
(16
)%
(63
)%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231205730759/en/
Investor Relations: Doug Clark investors@sentinelone.com
Press: Karen Master karen.master@sentinelone.com +1 (440)
862-0676
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