s-20240430

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-40531

SENTINELONE, INC.

(Exact name of registrant as specified in its charter)


Delaware		99-0385461
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
	444 Castro Street, Suite 400, Mountain View, California	94041
	(Address of Principal Executive Offices)	(Zip Code)


			(855) 868-3733
			Registrant's telephone number, including area code)
			Not Applicable
			(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001	S	The New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 24, 2024, the registrant had 286,659,799 shares of Class A common stock and 26,212,113 shares of Class B common stock outstanding.

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TABLE OF CONTENTS
			Page
Part I - Financial Information
Item 1. Financial Statements (Unaudited)			5
Condensed Consolidated Balance Sheets			5
Condensed Consolidated Statements of Operations			6
Condensed Consolidated Statements of Comprehensive Loss			7
Condensed Consolidated Statements of Stockholders' Equity			8
Condensed Consolidated Statements of Cash Flows			9
Notes to Condensed Consolidated Financial Statements			10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			22
Item 3. Quantitative and Qualitative Disclosures about Market Risk			33
Item 4. Controls and Procedures			34
Part II - Other Information			35
Item 1. Legal Proceedings			35
Item 1A. Risk Factors			36
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities			80
Item 3. Defaults Upon Senior Securities			80
Item 4. Mine Safety Disclosures			80
Item 5. Other Information			80
Item 6. Exhibits			81
Signatures			82

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Special Note About Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), about us and our industry that involve substantial risks and uncertainties. All statements contained in this Quarterly Report on Form 10-Q, other than statements of historical fact, including statements regarding our future operating results and financial condition, our business strategy and plans, market growth, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “potentially,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “would,” “project,” “target,” “plan,” “expect,” or the negative of these words and similar expressions are intended to identify forward-looking statements.

Forward-looking statements include, but are not limited to, statements about:

•our future financial performance, including our expectations regarding our total revenue, cost of revenue, gross profit or gross margin, operating expenses, including changes in operating expenses and our ability to achieve and maintain future profitability;

•the global political, economic, and macroeconomic climate, whether in the cybersecurity industry in general, or among specific types of customers or within particular geographies, including but not limited to, actual or perceived instability in the banking industry, supply chain disruptions, a potential recession, inflation, potential uncertainty with respect to the federal debt ceiling and budget, and potential government shutdowns related thereto, and interest rate volatility;

•the impact of natural or man-made global events on our business, including wars and other regional geopolitical conflicts, including the conflicts in Ukraine, the Middle East and tensions between China and Taiwan;

•the impact of actions that we are taking to improve operational efficiencies and operating costs, including the restructuring plan we approved in June 2023;

•our business plan and our ability to effectively manage our growth;

•our total market opportunity;

•anticipated trends, growth rates, and challenges in our business and in the markets in which we operate;

•our ability to maintain the security and availability of our platform;

•market acceptance of our platform and our ability to increase adoption of our platform;

•beliefs and objectives for future operations;

•our ability to further penetrate our existing customer base and attract, retain, and expand our customer base;

•our ability to timely and effectively scale and adapt our platform;

•future acquisitions or investments in complementary companies, products, services, or technologies and our ability to integrate such acquisitions or investments, including our recent acquisitions of the Krebs Stamos Group LLC (KSG) in November 2023 and both PingSafe Pte. Ltd. (PingSafe) and Stride Security Ltd. (Stride) in February 2024;

•cybersecurity incidents;

•our ability to develop new products and services and bring them to market in a timely manner and make enhancements to our platform;

•the ultimate success of technologies aimed at enhancing our platform, including through artificial intelligence (AI);

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•our expectations concerning relationships with third parties;

•our ability to maintain, protect, and enhance our intellectual property;

•our ability to continue to expand internationally;

•the effects of increased competition in our markets and our ability to compete effectively;

•our ability to stay in compliance with laws and regulations that currently apply or become applicable to our business both in the United States (U.S.) and internationally;

•economic and industry trends, projected growth, or trend analysis;

•expenses associated with being a public company; and

•other statements regarding our future operations, financial condition, and prospects and business strategies.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.

These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including those described in Part II, Item 1A., “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment, and new risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the forward-looking events and circumstances discussed in this Quarterly Report on Form 10-Q may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. We undertake no obligation to update publicly any of these forward-looking statements for any reason after the date of this report or to conform these statements to actual results or to changes in our expectations, except as required by law. Our forward-looking statements do not reflect the potential impact of any future acquisitions, partnerships, mergers, dispositions, joint ventures, or investments we may make.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed with the SEC as exhibits to this report with the understanding that our actual future results, performance, and events and circumstances may be materially different from what we expect.

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)


SENTINELONE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data)


	April 30,		January 31,
	2024		2024
Assets
Current assets:
Cash and cash equivalents	$	198,716	$	256,651
Short-term investments	574,488		669,305
Accounts receivable, net	133,773		214,322
Deferred contract acquisition costs, current	55,385		54,158
Prepaid expenses and other current assets	103,577		102,895
Total current assets	1,065,939		1,297,331
Property and equipment, net	57,052		48,817
Operating lease right-of-use assets	17,516		18,474
Long-term investments	336,469		204,798
Deferred contract acquisition costs, non-current	70,335		71,640
Intangible assets, net	126,842		122,903
Goodwill	629,636		549,411
Other assets	5,941		8,033
Total assets	$	2,309,730	$	2,321,407
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	9,202	$	6,759
Accrued liabilities	105,481		104,671
Accrued payroll and benefits	55,429		74,345
Operating lease liabilities, current	4,682		4,689
Deferred revenue, current	391,254		399,603
Total current liabilities	566,048		590,067
Deferred revenue, non-current	101,843		114,930
Operating lease liabilities, non-current	16,764		18,239
Other liabilities	9,455		4,128
Total liabilities	694,110		727,364
Commitments and contingencies (Note 10)
Stockholders’ equity:
Class A common stock; $0.0001 par value; 1,500,000,000 shares authorized as of April 30, 2024 and January 31, 2024; 285,332,523 and 269,780,805 shares issued and outstanding as of April 30, 2024 and January 31, 2024, respectively	29		27
Class B common stock; $0.0001 par value; 300,000,000 shares authorized as of April 30, 2024 and January 31, 2024; 26,223,766 and 34,910,917 shares issued and outstanding as of April 30, 2024 and January 31, 2024, respectively	3		3
Additional paid-in capital	3,027,530		2,934,607
Accumulated other comprehensive loss	(2,793)		(1,550)
Accumulated deficit	(1,409,149)		(1,339,044)
Total stockholders’ equity	1,615,620		1,594,043
Total liabilities and stockholders’ equity	$	2,309,730	$	2,321,407

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENTINELONE, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share data)


	Three Months Ended April 30,
	2024		2023
Revenue	$	186,355	$	133,393
Cost of revenue	50,137		42,583
Gross profit	136,218		90,810
Operating expenses:
Research and development	58,321		55,263
Sales and marketing	115,830		99,171
General and administrative	42,667		51,753

Total operating expenses	216,818		206,187
Loss from operations	(80,600)		(115,377)
Interest income	12,082		10,535
Interest expense	(36)		(607)
Other expense, net	(39)		(359)
Loss before income taxes	(68,593)		(105,808)
Provision for income taxes	1,512		1,061
Net loss	$	(70,105)	$	(106,869)
Net loss per share attributable to Class A and Class B common stockholders, basic and diluted	$	(0.23)	$	(0.37)
Weighted-average shares used in computing net loss per share attributable to Class A and Class B common stockholders, basic and diluted	309,547,693		288,300,705

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENTINELONE, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (in thousands)


	Three Months Ended April 30,
	2024		2023
Net loss	$	(70,105)	$	(106,869)
Other comprehensive income (loss):
Change in unrealized gains (losses) on investments	(1,243)		754
Total comprehensive loss	$	(71,348)	$	(106,115)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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SENTINELONE, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in thousands, except share data)


	Three Months Ended April 30, 2024
		Class A and Class B Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’ Equity
		Shares	Amount
Balance as of January 31, 2024		304,691,722	$	30	$	2,934,607	$	(1,550)	$	(1,339,044)	$	1,594,043
Issuance of common stock upon exercise of stock options		2,345,516	1		6,554		—		—		6,555
Issuance of common stock and assumed options in connection with acquisition		2,354,607	1

SEC Form 10-Q filed by SentinelOne Inc.