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Leases
12 Months Ended
Jan. 31, 2021
Leases [Abstract]  
Leases

Note 6. Leases

We have entered into various non-cancellable operating lease agreements for certain of our offices and data centers with lease periods expiring primarily between fiscal years 2022 and 2029. Certain of these arrangements have free or escalating rent payment provisions and optional renewal or termination clauses. Our operating leases typically include variable lease payments, which are primarily comprised of common area maintenance and utility charges for our offices and power and network connections for our data centers, that are determined based on actual consumption. Our operating lease agreements do not contain any residual value guarantees, covenants, or other restrictions.

We also entered into various finance lease arrangements to obtain servers and related equipment for our data center operations. These agreements are primarily for four years and certain of these arrangements have optional renewal or termination clauses. The leases are secured by the underlying leased servers and related equipment.

 

We sublease certain floors of our Redwood City, San Francisco, and London offices. Our current subleases have total lease terms ranging from 11 to 96 months that will expire at various dates by fiscal year 2025.

The components of lease cost, which were included in operating expenses in our consolidated statements of operations, were as follows (in thousands):

 

 

 

Year End January 31,

 

 

 

2021

 

 

2020

 

Finance lease cost:

 

 

 

 

 

 

 

 

Amortization of finance lease right-of-use assets

 

$

54,630

 

 

$

43,448

 

Interest on finance lease liabilities

 

 

5,753

 

 

 

4,483

 

Operating lease cost, gross

 

 

54,243

 

 

 

48,870

 

Variable lease cost, gross

 

 

9,288

 

 

 

11,862

 

Sublease income

 

 

(10,969

)

 

 

(11,504

)

Total lease cost (1)

 

$

112,945

 

 

$

97,159

 

 

(1)

Short-term lease cost was not material for the periods presented and is not included in the table above.

 

Supplemental cash flow information related to leases was as follows (in thousands):

 

 

 

Year End January 31,

 

 

 

2021

 

 

2020

 

Cash paid for amounts included in the measurement of lease liabilities

 

 

 

 

 

 

 

 

Operating cash flows for operating leases

 

$

59,478

 

 

$

48,675

 

Operating cash flows for finance leases

 

 

6,358

 

 

 

4,052

 

Financing cash flows for finance leases

 

 

60,020

 

 

 

38,542

 

Right-of-use assets obtained in exchange of lease obligations (1)

 

 

 

 

 

 

 

 

Operating leases

 

$

39,267

 

 

$

233,255

 

Finance leases

 

 

31,282

 

 

 

103,420

 

 

(1)

Amounts disclosed for the year ended January 31, 2020 include the adoption impact of ASC Topic 842 on the opening balance sheet as of February 1, 2019.

 

Supplemental information related to the remaining lease term and discount rate was as follows:

 

 

 

January 31,

 

 

 

2021

 

 

2020

 

Weighted-average remaining lease term (in years)

 

 

 

 

 

 

 

 

Operating leases

 

 

5.77

 

 

 

6.67

 

Finance leases

 

 

2.35

 

 

 

2.93

 

 

 

 

 

 

 

 

 

 

Weighted-average discount rate

 

 

 

 

 

 

 

 

Operating leases

 

 

5.27

%

 

 

5.40

%

Finance leases

 

 

4.44

%

 

 

4.56

%

 

As of January 31, 2021, maturities of our operating and finance lease liabilities, which do not include short-term leases and variable lease payments, are as follows (in thousands):

 

Fiscal years ending January 31:

 

Operating Leases (1)

 

 

Finance Leases

 

2022

 

$

59,002

 

 

$

53,788

 

2023

 

 

49,576

 

 

 

41,770

 

2024

 

 

48,093

 

 

 

19,357

 

2025

 

 

32,435

 

 

 

1,555

 

2026

 

 

28,348

 

 

 

 

Thereafter

 

 

63,562

 

 

 

 

Total lease payments

 

$

281,016

 

 

$

116,470

 

Less: imputed interest

 

 

(40,714

)

 

 

(6,231

)

Present value of total lease liabilities

 

$

240,302

 

 

$

110,239

 

 

(1)

Non-cancellable sublease proceeds for the fiscal years ending January 31, 2022, 2023, 2024, and 2025 of $9.3 million, $8.8 million, $2.3 million, and $2.1 million, respectively, are not included in the table above.

   We did not have any operating leases or finance leases that have not yet commenced as of January 31, 2021.

We establish assets and liabilities for the present value of estimated future costs to return certain of our leased facilities to their original condition. Such assets are depreciated over the lease period into operating expense, and the recorded liabilities are accreted to the future value of the estimated restoration costs. The present value of our estimated asset retirement obligation for our headquarters facility, which is recorded in other long-term liabilities, was $3.1 million and $2.8 million as of January 31, 2021 and 2020, respectively. The accretion expense, which was included in operating expenses in our consolidated statements of operations, was not material for all periods presented.