Acquisitions, Intangible Assets and Goodwill

9 Months Ended

Oct. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Acquisitions, Intangible Assets and Goodwill

Acquisitions

During the nine months ended October 31, 2020, the Company acquired certain assets from a privately-held company for $7.1 million in cash. The Company has accounted for this transaction as a business combination. In allocating the aggregate purchase price based on the estimated fair values, the Company recorded $5.7 million as a developed technology intangible asset (to be amortized over an estimated useful life of five years), and $1.4 million as goodwill, which is deductible for income tax purposes. The excess of purchase consideration over the fair value of net tangible and identifiable assets acquired was recorded as goodwill. The Company believes the goodwill balance associated with this acquisition represents the synergies expected from expanded market opportunities when integrating the acquired developed technologies with the Company’s offerings.

Aggregate acquisition-related costs associated with the business combination were not material for each of the three and nine months ended October 31, 2020 and were included in general and administrative expenses in the condensed consolidated statements of operations. The results of operations of the business combination have been included in the Company’s condensed consolidated financial statements from the acquisition date. The business combination did not have a material impact on the Company’s condensed consolidated financial statements. Therefore, historical results of operations subsequent to the acquisition date and pro forma results of operations have not been presented.

Intangible Assets

Intangible assets, net consisted of the following (in thousands):


	October 31, 2020		January 31, 2020

Developed technology	$	11,331	$	5,632
Patents	6,184		—
Other	47		97
Total intangible assets	17,562		5,729
Less: accumulated amortization	(2,742)		(934)
Total intangible assets, net	$	14,820	$	4,795

During the nine months ended October 31, 2020, the Company acquired patents for $6.2 million. The weighted-average useful life for these patents was approximately five years.

Amortization expense of intangible assets was $0.9 million and $1.9 million for the three and nine months ended October 31, 2020, respectively, and was $0.3 million and $0.6 million for the three and nine months ended October 31, 2019, respectively.

As of October 31, 2020, future amortization expense is expected to be as follows (in thousands):


	Amount
Fiscal Year Ending January 31,
Remainder of 2021	$	877
2022	3,503
2023	3,503
2024	3,503
2025	2,654
Thereafter	780
Total	$	14,820

Goodwill

The changes in the carrying amount of goodwill were as follows (in thousands):


	Carrying Amount

Balance as of January 31, 2020	$	7,049
Addition	1,400
Balance as of October 31, 2020	$	8,449