Net Loss Per Share

6 Months Ended

Jan. 31, 2023

NOTE 13. NET LOSS PER SHARE

Basic net income (loss) per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is computed by giving effect to potentially dilutive common stock equivalents outstanding during the period, as their effect would be dilutive. Potentially dilutive common shares include participating securities and shares issuable upon the exercise of stock options, the exercise of common stock warrants, the exercise of convertible preferred stock warrants, the vesting of RSUs and each purchase under the 2016 ESPP, under the if-converted method.

In loss periods, basic net loss per share and diluted net loss per share are the same, as the effect of potential common shares is antidilutive and therefore excluded.

Effective January 3, 2022, all of our then outstanding shares of Class B common stock, par value $0.000025 per share, were automatically converted into the same number of shares of the Company’s Class A common stock, par value $0.000025 per share, pursuant to the terms of our Amended and Restated Certificate of Incorporation. Prior to this conversion, the rights, including the liquidation and dividend rights, of the holders of our Class A and Class B common stock were identical, except with respect to voting. As the liquidation and dividend rights were identical, our undistributed earnings or losses were allocated on a proportionate basis among the holders of both Class A and Class B common stock. As a result, the net income (loss) per share attributed to common stockholders was the same for both Class A and Class B common stock on an individual or combined basis.

The computation of basic and diluted net loss per share attributable to common stockholders is as follows:


	Three Months Ended January 31,						Six Months Ended January 31,
	2022			2023			2022			2023
	(in thousands, except per share data)
Numerator:
Net loss	$	(115,416	)	$	(70,790	)	$	(535,622	)	$	(170,304	)
Denominator:
Weighted average shares—basic and diluted		218,808			231,924			217,153			230,229
Net loss per share attributable to common stockholders— basic and diluted	$	(0.53	)	$	(0.31	)	$	(2.47	)	$	(0.74	)

The potential shares of common stock that were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive are as follows:


	Six Months Ended January 31,
	2022		2023
	(in thousands)
Outstanding stock options and RSUs		27,421		30,841
Employee stock purchase plan		1,683		2,933
Common stock issuable upon the conversion of the Notes		39,968		36,986
Total		69,072		70,760

Shares that will be issued in connection with our stock awards and shares that will be purchased under the employee stock purchase plan are generally automatically converted into shares of our Class A common stock. Common stock issuable upon the conversion of convertible debt represents the antidilutive impact of the 2023 Notes, 2026 Notes and 2027 Notes under the if-converted method.