STOCKHOLDERS' EQUITY

3 Months Ended

Apr. 30, 2020

Stockholders' Equity Note [Abstract]

STOCKHOLDERS’ EQUITY

Dividends on Common Stock

We did not declare or pay any dividends on our common stock during the three months ended April 30, 2020 and 2019. Under the terms of our 2017 Credit Agreement, we are subject to certain restrictions on declaring and paying dividends on our common stock.

Stock Repurchase Program

On December 4, 2019, we announced that our board of directors had authorized a stock repurchase program whereby we may repurchase up to $300 million of common stock over the period ending on February 1, 2021. We made $34.0 million in repurchases under the program during the three months ended April 30, 2020 and $116.1 million of repurchases during the year ended January 31, 2020. Due to the uncertainty surrounding the impact of the COVID-19 pandemic, we will consider further repurchases under the stock repurchase program based on economic and market conditions as they evolve.

Treasury Stock

Repurchased shares of common stock are recorded as treasury stock, at cost, but may from time to time be retired. We periodically purchase treasury stock from directors, officers, and other employees to facilitate income tax withholding by us or the payment of required income taxes by such holders in connection with the vesting of equity awards.

During the three months ended April 30, 2020, we repurchased approximately 613,000 shares of treasury stock for a cost of $34.0 million under the share repurchase described above. During the three months ended April 30, 2019, we repurchased approximately 8,000 shares of treasury stock for a cost of $0.5 million to facilitate income tax withholding and payment requirements upon vesting of equity awards.

At April 30, 2020, we held approximately 4,404,000 shares of treasury stock with a cost of $208.1 million. At January 31, 2020, we held approximately 3,791,000 shares of treasury stock with a cost of $174.1 million.

Issuance of Convertible Preferred Stock

On December 4, 2019, in conjunction with the planned separation of our businesses into two independent publicly traded companies, we announced that an affiliate of Apax Partners would invest up to $400 million in us, in the form of convertible preferred stock. Under the terms of the Investment Agreement, the Apax Investor initially purchased $200 million of our Series A convertible preferred stock, which closed on May 7, 2020. Please refer to Note 16, “Subsequent Events” for additional information regarding the closing of the initial tranche.

Accumulated Other Comprehensive Income (Loss)

Accumulated other comprehensive income (loss) includes items such as foreign currency translation adjustments and unrealized gains and losses on certain marketable securities and derivative financial instruments designated as hedges. Accumulated other comprehensive income (loss) is presented as a separate line item in the stockholders’ equity section of our condensed consolidated balance sheets. Accumulated other comprehensive income (loss) items have no impact on our net income (loss) as presented in our condensed consolidated statements of operations.

The following table summarizes changes in the components of our accumulated other comprehensive income (loss) by component for the three months ended April 30, 2020:


(in thousands)	Unrealized Gains (Losses) on Foreign Exchange Contracts Designated as Hedges		Unrealized Loss on Interest Rate Swap Designated as Hedge		Foreign Currency Translation Adjustments		Total
Accumulated other comprehensive income (loss) at January 31, 2020	$	626	$	(10,528)	$	(141,963)	$	(151,865)
Other comprehensive loss before reclassifications	(829)		(5,949)		(20,640)		(27,418)
Amounts reclassified out of accumulated other comprehensive income (loss)	(46)		(463)		—		(509)
Net other comprehensive loss	(783)		(5,486)		(20,640)		(26,909)
Accumulated other comprehensive loss at April 30, 2020	$	(157)	$	(16,014)	$	(162,603)	$	(178,774)

All amounts presented in the table above are net of income taxes, if applicable. The accumulated net losses in foreign currency translation adjustments primarily reflect the strengthening of the U.S. dollar against the British pound sterling, which has resulted in lower U.S. dollar-translated balances of British pound sterling-denominated goodwill and intangible assets.

The amounts reclassified out of accumulated other comprehensive income (loss) into the condensed consolidated statement of operations, with presentation location, for the three months ended April 30, 2020 and 2019 were as follows:


	Three Months Ended April 30,
(in thousands)	2020		2019		Location
Unrealized losses on derivative financial instruments:
Foreign currency forward contracts	$	(3)	$	(72)	Cost of product revenue
	(5)		(84)		Cost of service and support revenue
	(27)		(472)		Research and development, net
	(17)		(311)		Selling, general and administrative
	(52)		(939)		Total, before income taxes
	6		94		Benefit from income taxes
	$	(46)	$	(845)	Total, net of income taxes

Interest rate swap agreement	$	(591)	$	—	Interest expense
	(591)		—		Total, before income taxes
	128		—		Benefit from income taxes
	$	(463)	$	—	Total, net of income taxes