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Samsara Inc.

Samsara Inc.IOT财报

NYSE · 信息技术 · 计算机集成系统设计服务

Samsara Inc. is an American IoT company headquartered in San Francisco, California, that provides telematics software and insights for physical operations. The company has customers across North America and Europe. Samsara developed a connected operations cloud platform that provides insights to physical operations organizations in the transportation, construction, energy, utilities, public sector and retail industries, and supports the safety and efficiency of those operations.

What changed in Samsara Inc.'s 10-K — 2025 vs 2026

Top changes in Samsara Inc.'s 2026 10-K

590 paragraphs added · 579 removed · 528 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

126 edited+14 added−13 removed59 unchanged
Organizations across industries in transportation, wholesale and retail trade, construction, field services, logistics, utilities and energy, manufacturing, government, healthcare and education, food and beverage, and others are the backbone of the global economy. They operate high-value assets, coordinate large field workforces, manage complex logistics and distributed sites, and face environmental, safety and other regulatory requirements.
Organizations across industries in transportation, construction, wholesale and retail trade, field services, logistics, manufacturing, utilities and energy, government, healthcare and education, food and beverage, and others are the backbone of the global economy. They operate high-value assets, coordinate large field workforces, manage complex logistics and distributed sites, and face environmental, safety, and other regulatory requirements.
Commercial vehicle fleets are the backbone of physical operations and are required to deliver and transport services, goods, and people in industries including transportation, construction, wholesale and retail trade, field services, logistics, utilities and energy, manufacturing, government, healthcare and education, food and beverage, and others.
Commercial vehicle fleets are the backbone of physical operations and are required to deliver and transport services, goods, and people in industries including transportation, construction, wholesale and retail trade, field services, logistics, manufacturing, utilities and energy, government, healthcare and education, food and beverage, and others.
Our Data Platform is deployed across a wide variety of industry verticals and integrated with third-party applications such as enterprise resource planning, payroll, and human capital management applications, extending the impact of IoT data to customers’ existing applications. Our Connected Operations Cloud was also built with data security and privacy in mind.
Our Data Platform is deployed across a wide variety of industry verticals and integrated with third-party applications such as enterprise resource planning, payroll, and human capital management applications, extending the impact of IoT data to customers’ existing applications. Our Connected Operations Platform was also built with data security and privacy in mind.
We also partner with leading OEMs who embed sensors and connectivity into their products, enabling customers to bring IoT data from their assets into our Data Platform without aftermarket IoT devices. Our ecosystem connectivity expands our reach in the market and reinforces the integration of our Connected Operations Cloud with our customers’ physical operations. • Differentiated Company Culture.
We also partner with leading OEMs who embed sensors and connectivity into their products, enabling customers to bring IoT data from their assets into our Data Platform without aftermarket IoT devices. Our ecosystem connectivity expands our reach in the market and reinforces the integration of our Connected Operations Platform with our customers’ physical operations. • Differentiated Company Culture.
For example, on our dual-facing AI dash cams, embedded AI models analyze driver behaviors and road conditions in real time to provide visibility into leading causes of preventable incidents, such as mobile usage, lack of seatbelts, tailgating, and inattentive driving.
For example, on our dual-facing AI dash cams, embedded AI models analyze driver behaviors and road conditions in real time to provide visibility into leading causes of preventable incidents, such as mobile usage, lack of seatbelts, tailgating, and inattentive and drowsy driving.
Our Connected Operations Cloud consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights, using our cloud dashboard, custom alerts and reports, mobile apps, and workflows.
Our Connected Operations Platform consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights using our cloud dashboard, custom alerts and reports, mobile apps, and workflows.
This agility and capacity are enabled by our proprietary Data Platform, which allows our Connected Operations Cloud to ingest, stream and analyze massive datasets in real-time. Our Data Platform now processes trillions of event points per year in a highly performant manner.
This agility and capacity are enabled by our proprietary Data Platform, which allows our Connected Operations Platform to ingest, stream and analyze massive datasets in real-time. Our Data Platform now processes trillions of event points per year in a highly performant manner.
We are seeing strong adoption of integrations on our platform, with our largest customers using on average six or more API integrations. Sales and Marketing We primarily sell subscriptions to our Connected Operations Cloud to large, medium-sized, and small businesses through direct sales.
We are seeing strong adoption of integrations on our platform, with our largest customers using on average six or more API integrations. Sales and Marketing We primarily sell subscriptions to our Connected Operations Platform to large, medium-sized, and small businesses through direct sales.
Our Connected Operations Cloud captures data that was previously siloed and difficult to analyze in several different ways. For the many physical assets that are still offline, our solution includes IoT devices that capture data and connect it to the cloud.
Our Connected Operations Platform captures data that was previously siloed and difficult to analyze in several different ways. For the many physical assets that are still offline, our solution includes IoT devices that capture data and connect it to the cloud.
Our solution lets organizations capture data from our IoT devices and a growing ecosystem of connected assets and third-party systems so that they can access, analyze, and act on key insights to improve end-to-end operations.
Our solution lets organizations capture data from our IoT devices and a growing ecosystem of connected assets and third-party systems so they can access, analyze, and act on key insights to improve end-to-end operations.
These partnerships enable us to capture IoT data into our Connected Operations Cloud without requiring customers to install aftermarket IoT devices. This lowers the barrier to connecting data to our platform. Our partner ecosystem also encompasses a number of commercial partnerships.
These partnerships enable us to capture IoT data into our Connected Operations Platform without requiring customers to install aftermarket IoT devices. This lowers the barrier to connecting data to our platform. Our partner ecosystem also encompasses a number of commercial partnerships.
The Principal Competitive Factors in the Markets in Which We Operate Include: • All-in-one software and hardware solution that addresses specific industry needs; • Cloud-native software applications whose feature set is effective, extensible, and evolving; • Rapid development cycle; • High-quality, relevant, and actionable insights for operational managers and workers; • Scalable data platform that can ingest and process data from various sources and apply powerful analytics across multiple data sets; 17 Table of Contents • Ease of adoption from installation to usability for back-office administrators and field workers; • Reliability and security; • Quality and responsiveness of customer support channels; • Return on investment: Price for software, devices, installation and support relative to achieved cost savings; • Brand awareness, reputation and trust in the provider’s services; and • Strength of sales, marketing and channel partner relationships.
The Principal Competitive Factors in the Markets in Which We Operate Include: • All-in-one software and hardware solution that addresses specific industry needs; • Cloud-native software applications whose feature set is effective, extensible, and evolving; • Rapid development cycle; • High-quality, relevant, and actionable insights for operational managers and workers; • Scalable data platform that can ingest and process data from various sources and apply powerful analytics across multiple data sets; • Ease of adoption from installation to usability for back-office administrators and field workers; • Reliability and security; • Quality and responsiveness of customer support channels; • Return on investment: Price for software, devices, installation and support relative to achieved cost savings; • Brand awareness, reputation and trust in the provider’s services; and • Strength of sales, marketing and channel partner relationships.
This single pane of glass is designed to deliver deep insight into a customer’s end-to-end physical operations. • Extensible Technology Platform. Our Connected Operations Cloud is fully integrated to securely access and manage multiple Applications for physical operations.
This single pane of glass is designed to deliver deep insight into a customer’s end-to-end physical operations. • Extensible Technology Platform. Our Connected Operations Platform is fully integrated to securely access and manage multiple Applications for physical operations.
Our solution consists of our Connected Operations Cloud, together with a suite of easy-to-install, ruggedized IoT devices that capture data from offline assets and connect them to the cloud.
Our solution consists of our Connected Operations Platform, together with a suite of easy-to-install, ruggedized IoT devices that capture data from offline assets and connect them to the cloud.
We have also implemented a public bug bounty program to facilitate responsible disclosure of potential security vulnerabilities, which are identified by external researchers who are rewarded for their verified findings; our internal security team then works on addressing these vulnerabilities as appropriate. App Marketplace and APIs Samsara’s integration ecosystem includes over 270 pre-built integrations in our App Marketplace.
We have also implemented a public bug bounty program to facilitate responsible disclosure of potential security vulnerabilities, which are identified by external researchers who are rewarded for their verified findings; our internal security team then works on addressing these vulnerabilities as appropriate. App Marketplace and APIs Samsara’s integration ecosystem includes over 300 pre-built integrations in our App Marketplace.
We use this input to update the privacy features of our Connected Operations Cloud, develop new features and Applications, and give our customers the tools they need to meet their data protection and privacy goals. 15 Table of Contents Our Connected Operations Cloud is designed to deliver a robust and ready-to-use security infrastructure to our customers, who can leverage our features to enhance their own security programs without needing to have deep security expertise.
We use this input to update the privacy features of our Connected Operations Platform, develop new features and Applications, and give our customers the tools they need to meet their data protection and privacy goals. 15 Table of Contents Our Connected Operations Platform is designed to deliver a robust and ready-to-use security infrastructure to our customers, who can leverage our features to enhance their own security programs without needing to have deep security expertise.
When a model detects these behaviors, Samsara’s Connected Operations Cloud can proactively coach drivers in real time to improve safety and empower them to improve their habits on the road. Wireless Connectivity We have capitalized on advances in cellular technology to capture data in our Connected Operations Cloud from places where it was not previously feasible to connect.
When a model detects these behaviors, Samsara’s Connected Operations Platform can proactively coach drivers in real time to improve safety and empower them to improve their habits on the road. Wireless Connectivity We have capitalized on advances in cellular technology to capture data in our Connected Operations Platform from places where it was not previously feasible to connect.
It provides non-technical customers advanced security and privacy tooling that is easy to adopt and tailored for the specific Applications they depend on. The integrated nature of our Connected Operations Cloud offers a differentiated IoT data solution, even to those of our customers who are not data experts. • Purpose-Built for Enterprise-Grade Physical Operations.
It provides non-technical customers advanced security and privacy tooling that is easy to adopt and tailored for the specific Applications they depend on. The integrated nature of our Connected Operations Platform offers a differentiated IoT data solution, even to those of our customers who are not data experts. • Purpose-Built for Enterprise-Grade Physical Operations.
This enables developers to integrate our Connected Operations Cloud into a variety of use cases from payroll to TMS, fuel purchasing tools, navigation, and more. These APIs cover all of Samsara’s core Applications. We also have partnerships with OEMs who build connectivity into their products, such as vehicles and heavy equipment.
This enables developers to integrate our Connected Operations Platform into a variety of use cases from payroll to TMS, fuel purchasing tools, navigation, and more. These APIs cover all of Samsara’s core Applications. We also have partnerships with OEMs who build connectivity into their products, such as vehicles and heavy equipment.
Our system of record enables operations to achieve higher utilization of physical assets, reduced need for manual oversight, improved safety outcomes, lower insurance costs, fuel and electricity savings, emissions reductions, less unplanned downtime, efficiencies from routing and scheduling, minimized compliance costs, and automation of manual processes. Our Connected Operations Cloud benefits from powerful network effects.
Our system of record enables operations to achieve higher utilization of physical assets, reduced need for manual oversight, improved safety outcomes, lower insurance costs, fuel and electricity savings, emissions reductions, less unplanned downtime, efficiencies from routing and scheduling, minimized compliance costs, and automation of manual processes. Our Connected Operations Platform benefits from powerful network effects.
These industries are ripe for transformation, with a breadth of available data and widespread reliance on antiquated, legacy technologies. Industries with commercial vehicle fleets face continued pressure to reduce costs and improve services, while simultaneously finding ways to overcome high accident rates, inefficient fuel consumption, and compliance burdens.
These industries are ripe for transformation, with a breadth of available data and widespread reliance on antiquated, legacy technologies. Industries with commercial vehicle fleets face continued pressure to reduce costs and improve services, while simultaneously finding ways to overcome high accident rates, asset utilization, inefficient fuel consumption, and compliance burdens.
Our customers can also customize and control privacy features to help meet their compliance requirements under laws and regulations such as the European Union (“EU”) General Data Protection Regulation (“GDPR”), UK General Data Protection Regulation (“UK GDPR”), and UK Data Protection Act (“UKDPA”) in Europe, as well as those in the United States such as the California Consumer Privacy Act (“CCPA”).
Our customers can also customize and control privacy features to help meet their compliance requirements under laws and regulations such as the European Union (“EU”) General Data Protection Regulation (“GDPR”), UK General Data Protection Regulation (“UK GDPR”), and UK Data Protection Act (“UK DPA”) in Europe, as well as those in the United States such as the California Consumer Privacy Act (“CCPA”).
This drives significant trust in the solution and helps our highly technical sales team demonstrate the full capacity of our Connected Operations Cloud while simultaneously reducing post-sales friction. We invest in a variety of marketing activities and programs to drive awareness, engage with prospective customers, and build a pipeline for our sales team.
This drives significant trust in the solution and helps our highly technical sales team demonstrate the full capacity of our Connected Operations Platform while simultaneously reducing post-sales friction. We invest in a variety of marketing activities and programs to drive awareness, engage with prospective customers, and build a pipeline for our sales team.
We work with a network of reseller partners and also have partnerships with insurance providers and select vendors in the third-party logistics (3PL) network. We have also partnered with insurance companies, who have become an important partner constituency whose end customers can leverage our Connected Operations Cloud in order to improve safety.
We work with a network of reseller partners and also have partnerships with insurance providers and select vendors in the third-party logistics (3PL) network. We have also partnered with insurance companies, who have become an important partner constituency whose end customers can leverage our Connected Operations Platform in order to improve safety.
Our customers feel like they are contributing to their own success, and in turn, continue to provide invaluable feedback as our Connected Operations Cloud evolves. This flywheel effect accelerates innovation across all aspects of our solution. • Partner Ecosystem. Our Connected Operations Cloud serves as a central hub for a robust ecosystem of partner connections.
Our customers feel like they are contributing to their own success, and in turn, continue to provide invaluable feedback as our Connected Operations Platform evolves. This flywheel effect accelerates innovation across all aspects of our solution. • Partner Ecosystem. Our Connected Operations Platform serves as a central hub for a robust ecosystem of partner connections.
Based on these factors, we believe we are positioned favorably against our competitors. While many competitors focus on a subset of solutions for vehicles, such as GPS tracking and/or driver coaching, our Connected Operations Cloud provides an extensive view of relevant operational information across many physical operations assets.
Based on these factors, we believe we are positioned favorably against our competitors. While many competitors focus on a subset of solutions for vehicles, such as GPS tracking and/or driver coaching, our Connected Operations Platform provides an extensive view of relevant operational information across many physical operations assets.
This operational and IT data is ingested into our Data Platform, where it is aggregated, enriched, and analyzed using embedded functionality for AI, workflows and analytics, alerts, API connections, and data security and privacy. Our Data Platform powers our Applications, which include Video-Based Safety, Vehicle Telematics, Mobile Apps and Workflows, Equipment Monitoring, and Site Visibility.
This operational and IT data is ingested into our Data Platform, where it is aggregated, enriched, and analyzed using embedded functionality for AI, workflows and analytics, alerts, API connections, and data security and privacy. Our Data Platform powers our Applications, which include Video-Based Safety, Vehicle Telematics, Workforce Apps, Equipment Monitoring, and Site Visibility.
We are building an extensive community of operations leaders through customer advisory boards, executive summits, and premier industry conferences. • Innovation Flywheel. We constantly innovate to improve our customers’ operations. We have a culture of innovation, which is evidenced by our release of new features throughout fiscal year 2024.
We are building an extensive community of operations leaders through customer advisory boards, executive summits, and premier industry conferences. • Innovation Flywheel. We constantly innovate to improve our customers’ operations. We have a culture of innovation, which is evidenced by our release of new features throughout fiscal year 2025.
Our ecosystem includes over 270 third-party integrations in the Samsara App Marketplace, a portal through which customers can access those integrations to connect Samsara to other systems. Our Experts Marketplace features a network of certified system integrators, consultants, and implementation partners who provide services to our customers.
Our ecosystem includes over 300 third-party integrations in the Samsara App Marketplace, a portal through which customers can access those integrations to connect Samsara to other systems. Our Experts Marketplace features a network of certified system integrators, consultants, and implementation partners who provide services to our customers.
By using Samsara’s Connected Operations Cloud, our customers are able to realize significant improvements in their operations that are reflected in their cost savings, improved safety and compliance records, and superior end-customer experience. These improvements can lead to improved profitability and durable revenue growth for our customers.
By using Samsara’s Connected Operations Platform, our customers are able to realize significant improvements in their operations that are reflected in their cost savings, improved safety and compliance records, and superior end-customer experience. These improvements can lead to improved profitability and durable revenue growth for our customers.
State-of-Art IoT Device Design Our Connected Operations Cloud is open and flexible, ingesting and synthesizing data from IoT and connected assets, whether they are from the customer or provided by Samsara. Our IoT devices are designed for ease of installation, value, reliability, and connectivity.
State-of-Art IoT Device Design Our Connected Operations Platform is open and flexible, ingesting and synthesizing data from IoT and connected assets, whether they are from the customer or provided by Samsara. Our IoT devices are designed for ease of installation, value, reliability, and connectivity.
Research and Development Our research and development organization is responsible for the design, development, testing and delivery of new technologies, features, and integrations of our Applications, as well as the continued improvement and iteration of our Applications. It is also responsible for operating and scaling our Data Platform, including the underlying cloud infrastructure.
Research and Development Our research and development organization is responsible for the design, development, testing and delivery of new technologies, features, and integrations of our Connected Operations Platform, as well as the continued improvement and iteration of our Applications. It is also responsible for operating and scaling our Data Platform, including the underlying cloud infrastructure.
We make copies of these reports and other information available on our website, free of charge, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
We make copies of these reports and other information available on our investor relations website, free of charge, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
Our Data Platform also empowers developers via an open API and provides enhanced privacy and security features that are tailored to our Applications. 6 Table of Contents Our customers range from small and medium-sized businesses to state and local governments and large, global enterprises with the most complex operations involving tens of thousands of physical assets.
Our Data Platform also empowers developers via an open API and provides enhanced privacy and security features that are tailored to our Applications. Our customers range from small and medium-sized businesses to state and local governments and large, global enterprises with the most complex operations involving tens of thousands of physical assets.
Our Connected Operations Cloud includes: • Our Data Platform, which ingests, aggregates, and enriches data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and which has embedded capabilities for AI, workflows and analytics, alerts, API connections, and data security and privacy; and • Applications for Video-Based Safety, Vehicle Telematics, Mobile Apps and Workflows, Equipment Monitoring, and Site Visibility.
Our Connected Operations Platform includes: • Our Data Platform, which ingests, aggregates, and enriches data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and which has embedded capabilities for AI, workflows and analytics, alerts, API connections, and data security and privacy; and • Applications for Video-Based Safety, Vehicle Telematics, Workforce Apps, Equipment Monitoring, and Site Visibility.
This real-time data enables intelligent recommendations that empower customers to achieve operational success while consolidating vendor costs and administration. Our solution allows customers to use Samsara as their only physical operations management provider, instead of having to source, integrate and adopt point solutions across a variety of vendors.
This real-time data enables intelligent recommendations that empower customers to achieve operational success while consolidating vendor costs and administration. 17 Table of Contents Our solution allows customers to use Samsara as their only physical operations management provider, instead of having to source, integrate and adopt point solutions across a variety of vendors.
For smaller customers, add-ons, expansions, and renewals, we have a self-service model driven by a seamless web store experience. Our go-to-market and sales efforts are strengthened by our free-trial sales model. Prospective customers are invited to test our Connected Operations Cloud for their use case during a trial period at no cost.
For smaller customers and for many add-ons, expansions, and renewals, we have a self-service model driven by a seamless web store experience. Our go-to-market and sales efforts are strengthened by our free-trial sales model. Prospective customers are invited to test our Connected Operations Platform for their use case during a trial period at no cost.
Our real-time location tracking and utilization reporting can reduce theft, improve utilization and simplify asset allocation and rightsizing. Our application provides rich visibility into a variety of equipment used in operations, such as generators, compressors, heavy construction equipment, trailers, and unpowered assets such as dumpsters and storage containers. • Maintenance.
Our real-time and near-real time location tracking and utilization reporting can reduce theft, improve utilization, and simplify asset allocation and rightsizing. Our application provides rich visibility into a variety of equipment used in operations, such as generators, compressors, heavy construction equipment, trailers, and unpowered assets such as small tools, dumpsters and storage containers. • Maintenance.
We provide customers with customizable privacy control measures, features, and tools to help them meet specific privacy requirements, standards, and applicable jurisdiction-specific legislation they may be subject to (including, for example, the GDPR, UK GDPR, UKDPA, and CCPA, as amended by the California Privacy Rights Act of 2020 (“CPRA”)).
We provide customers with customizable privacy control measures, features, and tools to help them meet specific privacy requirements, standards, and applicable jurisdiction-specific legislation to which they may be subject (including, for example, the GDPR, UK GDPR, UK DPA, and CCPA, as amended by the California Privacy Rights Act of 2020 (“CPRA”)).
Our goal is to continue to add new data types to our Connected Operations Cloud, and use this growing data asset alongside customer feedback to innovate and introduce new Applications that our customers can use across their operations.
Our goal is to continue to add new data types to our Connected Operations Platform, and use this growing data asset alongside customer feedback to innovate and introduce new Applications that our customers can use across their operations.
As we aggregate and analyze more data, the benefits of our Connected Operations Cloud increase. • Single Integrated Platform. Our integrated platform brings together data from across an organization’s physical operations, including fleets, equipment, and sites, to give customers a digital, actionable view of their physical operations in one place.
As we aggregate and analyze more data, the benefits of our Connected Operations Platform increase. • Single Integrated Platform. Our integrated platform brings together data from across an organization’s physical operations, including fleets, equipment, sites, and frontline workforce to give customers a digital, actionable view of their physical operations in one place.
We believe that we are well positioned to capitalize on the ongoing rollout of 5G and the capabilities that a more robust network can provide, particularly in leveraging AI and video.
We believe that we are well positioned to capitalize on the ongoing proliferation of 5G and the capabilities that a more robust network can provide, particularly in leveraging AI and video.
Our most significant investments are in research and development to drive core technology innovation and to bring new Applications to market. Competition The connected physical operations industry is highly fragmented, with most vendors offering software and/or hardware solutions addressing specific industry verticals or specific solution sets.
Our most significant investments are in research and development to drive core technology innovation and to bring new Applications to market. Competition The connected physical operations industry is highly fragmented, with most vendors offering software and/or hardware solutions addressing specific industry verticals, solution sets, geographies, and/or customer sizes.
We see a significant opportunity to expand Application adoption, increase the number of physical assets integrated with our Connected Operations Cloud, and expand across our customers’ operations. We will continue to educate our customers on the benefits of using our other Applications and leveraging our Connected Operations Cloud. • Continuous Customer-centric Innovation and Product Releases.
We see a significant opportunity to expand Applications adoption, increase the number of physical assets integrated with our Connected Operations Platform, and expand across our customers’ operations. We will continue to educate our customers on the benefits of using our other Applications and leveraging our Connected Operations Platform. • Continuous Customer-centric Innovation and Product Releases.
Our Connected Operations Cloud is broadly applicable across verticals, and we provide customizability with over 270 partner integrations, including numerous OEM partnerships. Continued growth in integrations will strengthen our ecosystem, further increasing the opportunity to attract customers that prioritize interoperability with their existing software applications. We believe that additional partnerships will also enhance our go-to-market channels. • Expand Internationally.
Our Connected Operations Platform is broadly applicable across verticals, and we provide customizability with over 300 partner integrations, including numerous OEM partnerships. Continued growth in integrations will strengthen our ecosystem, further increasing the opportunity to attract customers that prioritize interoperability with their existing software applications. We believe that additional partnerships will also enhance our go-to-market channels. • Expand Internationally.
We announce material information to the public about us, our products, and other matters through a variety of means, including filings with the SEC, press releases, public conference calls, webcasts, our investor relations website, our corporate website (www.samsara.com), and our corporate blog (www.samsara.com/blog) in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligations under Regulation FD.
We announce material information to the public about us, our products, and other matters through a variety of means, including filings with the SEC, press releases, public conference calls, webcasts, our investor relations website, our corporate website (www.samsara.com), our corporate blog (www.samsara.com/blog), and our and our executives’ social media accounts in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligations under Regulation FD.
As our relationships with these insurance partners have deepened, they have often incentivized their end customers to adopt our Connected Operations Cloud in exchange for reduced insurance premiums.
As our relationships with these insurance partners have deepened, they have often incentivized their end customers to adopt our Connected Operations Platform in exchange for reduced insurance premiums.
We offer and include the latest EU Standard Contractual Clauses (“SCCs”) and supporting UK International Data Transfer Addendum in our contractual terms with customers for the purpose of helping enable our customers’ continued compliance with the changing regulatory landscape in connection with transferring personal data subject to the GDPR, UK GDPR, and UKDPA to “third countries” that have not been found to provide adequate protection to such personal data, including the United States, highlighting a commitment to protect personal information in accordance with a set of privacy principles that offer meaningful privacy protections and recourse for European-based individuals.
We offer and include the latest EU Standard Contractual Clauses (“SCCs”) and supporting UK International Data Transfer Addendum in our contractual terms with customers for the purpose of helping enable our customers’ continued compliance with the changing regulatory landscape in connection with transferring personal data subject to the GDPR, UK GDPR, and UK DPA to “third countries” that have not been found to provide adequate protection to such personal data, including the United States, Mexico, Colombia, Taiwan, and India, highlighting a commitment to protect personal information in accordance with a set of privacy principles that offer meaningful privacy protections and recourse for European-based individuals.
Our Connected Operations Cloud provides real measurable impact to the safety, efficiency, and sustainability of our customers’ operations. In fiscal year 2024, Samsara’s technology helped prevent thousands of driving accidents, digitized millions of pen and paper processes, and helped eliminate billions of pounds of CO 2 . Our customers also benefit from greater fuel savings and less driver turnover.
Our Connected Operations Platform provides real measurable impact to the safety, efficiency, and sustainability of our customers’ operations. In fiscal year 2025, Samsara’s technology helped prevent thousands of driving accidents, digitized millions of pen and paper processes, and helped eliminate billions of pounds of CO 2 . Our customers also benefit from greater fuel savings and less driver turnover.
We enable our customers to actively monitor safety issues by leveraging IoT data and AI to extract patterns and improve their safety programs.
We enable our customers to actively monitor safety issues by leveraging IoT data, AI, and workforce apps to extract patterns and improve their safety programs.
By harnessing recent advancements in IoT connectivity, artificial intelligence (“AI”), cloud computing, and video imagery, we are enabling the digital transformation of physical operations. Using our Connected Operations Cloud, customers can access their physical operations data in real-time, on one integrated platform in a way that would have been impossible and impractical only a few years ago.
By harnessing recent advancements in artificial intelligence (“AI”), IoT connectivity, cloud computing, and video imagery, we are enabling the digital transformation of physical operations. Using our Connected Operations Platform, customers can unlock actionable insights from their physical operations data in real-time, on one integrated platform in a way that would have been impossible and impractical only a few years ago.
We plan to continually invest in our sales and marketing capabilities and leverage our go-to-market model to continue acquiring new customers. • Expand Within Our Existing Customer Base. As of February 3, 2024, over 80% of our Core Customers and over 90% of our customers representing over $100,000 in ARR subscribed to multiple Applications.
We plan to continually invest in our sales and marketing capabilities and leverage our go-to-market model to continue acquiring new customers. • Expand Within Our Existing Customer Base. As of February 1, 2025, over 80% of our Core Customers and over 90% of our customers representing over $100,000 in ARR subscribed to multiple Applications.
Privacy and Security by Design We have designed and developed our Connected Operations Cloud from the ground up with privacy and security in mind.
Privacy and Security by Design We have designed and developed our Connected Operations Platform from the ground up with privacy and security in mind.
Our simple user experience and clean user interface make it easy for users to get up and running on Samsara, from back-office administrative teams to frontline workers and drivers. Once implemented, we make it easy for customers to add new Applications. • Clear Return on Investment.
Our simple user experience and clean user interface make it easy for users to get up and running on Samsara, from back-office administrative teams to frontline workers and drivers. Once implemented, we make it easy for customers to add new Applications. 10 Table of Contents • Clear Return on Investment.
We estimate that these industries represented over 40% of the global GDP in 2023. Yet historically, these industries have been underserved by technology, leaving them heavily reliant on manual processes and legacy systems that are siloed and lack cloud connectivity.
We estimate that these industries represent over 40% of the global GDP. Yet historically, these industries have been underserved by technology, leaving them heavily reliant on manual processes and legacy systems that are siloed and lack cloud connectivity.
Key Applications of Our Connected Operations Cloud We chose to start our journey in digitizing physical operations with connected fleets.
Key Applications of Our Connected Operations Platform We chose to start our journey in digitizing physical operations with connected fleets.
Despite our pending U.S. patent applications, there can be no assurance that our patent applications will result in issued patents.
Despite our pending patent applications, there can be no assurance that our patent applications will result in issued patents.
We expect that the need for our IoT devices will diminish over time as physical asset OEMs begin to produce connected assets that can connect to our Connected Operations Cloud without additional IoT devices provided by us.
We expect that the need for our IoT devices will diminish over time if physical asset OEMs begin to produce connected assets that can connect to our Connected Operations Platform without additional IoT devices provided by us.
Our ELD, which is registered with the Federal Motor Carrier Safety Administration (“FMCSA”) and certified with Transport Canada, allows customers to simplify HOS compliance. Fleet operators access key information needed to meet stringent regulations while lowering the costs of compliance. Equipment Monitoring • Location, Utilization, and Theft Monitoring.
Our ELD, which is registered or certified with the applicable regulators, including the United States Federal Motor Carrier Safety Administration (“FMCSA”) and Transport Canada, allows customers to simplify HOS compliance. Fleet operators access key information needed to meet stringent regulations while lowering the costs of compliance. Equipment Monitoring • Location, Utilization, and Theft Monitoring.
Our solution connects physical operations data to our Connected Operations Cloud, which consists of our Data Platform and Applications. Our Data Platform ingests, aggregates, and enriches data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes the data actionable for use cases through our Applications.
We provide an end-to-end solution for operations. Our solution connects physical operations data to our Connected Operations Platform, which consists of our Data Platform and Applications. Our Data Platform ingests, aggregates, and enriches data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes the data actionable for use cases through our Applications.
A key focus of our company is to continue to expand our global reach. In May 2018, we established our first international office in England. In fiscal year 2024, we continued to expand our international footprint, which now spans across the United States, Canada, Mexico, Taiwan, England, France, Germany, Poland, and the Benelux region.
A key focus of our company is to continue to expand our global reach. In May 2018, we established our first international office in England. In fiscal year 2025, we continued to expand our international footprint, and our employee base now spans across the United States, Canada, Mexico, Taiwan, India, England, France, Germany, Poland, and the Benelux region.
The information disclosed by the foregoing channels could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above and review the information disclosed through such channels. 19 Table of Contents
The information disclosed by the foregoing channels could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above and review the information disclosed through such channels.
For assets without embedded sensors, we capture data using our self-installed plug-and-play IoT devices. For offline assets with built-in sensors, we provide connectivity to the internet. We have also invested in cloud-based integrations with third-party systems to unlock data directly in the cloud. • Provides a Single Pane of Glass.
For assets without embedded sensors, we capture data using our self-installed plug-and-play IoT devices. For offline assets with built-in sensors, we transfer data to the cloud using APIs and other connections. We have also invested in cloud-based integrations with third-party systems to unlock data directly in the cloud. • Provides a Single Pane of Glass.
Our solution provides visibility into equipment usage and anomalies, such as engine faults or failing batteries. With this data, customers are informed as soon as faults are detected or vehicle inspections are submitted, which allows for a quick dispatch to fix vehicles to extend longevity and reduce vehicle downtime. • Refrigerated Trailer and Cold Chain Monitoring.
Our solution provides visibility into equipment usage and anomalies, such as engine faults or failing batteries. With this data, customers are informed as soon as faults are detected or vehicle inspections are submitted, which allows for a quick dispatch to fix vehicles to extend longevity and reduce vehicle downtime. • Smart Trailers.
We partner with leading OEMs to capture data from their siloed clouds into our Connected Operations Cloud, where we enrich and analyze the data and enable customers to benefit from certain Applications without needing to install an aftermarket IoT device in their vehicle. 13 Table of Contents Mobile Apps and Workflows • Mobile Workflows.
We partner with leading OEMs to capture data from their siloed clouds into our Connected Operations Platform, where we enrich and analyze the data and enable customers to benefit from certain Applications without needing to install an aftermarket IoT device in their vehicle. Workforce Apps • Mobile Workflows.
For the physical assets that are increasingly embedded with cloud connectivity, we partner with original equipment manufacturers (“OEMs”) to capture data via application programming interfaces (“APIs”). Data may also be captured from customer enterprise applications or local software systems.
For the physical assets that are increasingly embedded with cloud connectivity, we work with original equipment manufacturers (“OEMs”) and other partners to capture data via application programming interfaces (“APIs”) or other connection methods. Data may also be captured from customer enterprise applications or local software systems.
As of February 3, 2024, we had over 16,000 Core Customers, who are customers with subscriptions to our Connected Operations Cloud, each representing $10,000 or more in annual recurring revenue (“ARR”). 1 2 While our Connected Operations Cloud is accessible to customers of all sizes, we are particularly focused on larger customers representing over $100,000 in ARR.
As of February 1, 2025, we had over 20,000 Core Customers, who are customers with subscriptions to our Connected Operations Platform, each representing $10,000 or more in annual recurring revenue (“ARR”). 1 While our Connected Operations Platform is accessible to customers of all sizes, we are particularly focused on larger customers representing over $100,000 in ARR.
Our newest software-based features, which include mobile experience management and connected forms, help organizations digitize more of their operation and empower their employees to operate more safely and efficiently at scale. • Equipment Monitoring: Provides extensive visibility and management of unpowered and powered assets, ranging from generators and compressors to heavy construction equipment and trailers, to improve operating efficiency, prevent unplanned downtime, and avoid critical safety and compliance issues.
Our newest software-based features help organizations digitize more of their operation and empower their employees to operate more safely and efficiently at scale. 8 Table of Contents • Equipment Monitoring: Provides extensive visibility and management of unpowered and powered assets, ranging from small tools, generators and compressors to heavy construction equipment and trailers, to improve operating efficiency, prevent unplanned downtime, and avoid critical safety and compliance issues.
Building on our experience in connected fleets, our industry-agnostic architecture and culture of innovation enabled us to add new data to our Connected Operations Cloud and develop new Applications across physical operations, including: • Mobile Apps and Workflows: Improves productivity for frontline workers and enables regulatory compliance, as workers see upcoming jobs, capture electronic documents, perform maintenance inspections, maintain compliance logs, and message with back-office administration.
Building on our experience in connected fleets, our industry-agnostic architecture and culture of innovation enabled us to add new data to our Connected Operations Platform and develop new Applications across physical operations, including: • Workforce Apps: Improves safety and productivity for frontline workers and enables regulatory compliance, as workers see upcoming jobs, capture electronic documents, perform maintenance inspections, maintain compliance logs, complete safety audits and risk assessments, submit timesheets, and message with back-office administration.
As of the last business day of the fiscal year ended February 3, 2024, we had 2,895 employees. Growth Strategies We intend to pursue the following growth strategies: • Expand Our Customer Base by Acquiring New Customers. With a rapidly digitizing market, we believe that there is a significant opportunity to continue to grow our customer base.
As of the last business day of the fiscal year ended February 1, 2025, we had more than 3,500 full-time employees. Growth Strategies We intend to pursue the following growth strategies: • Expand Our Customer Base by Acquiring New Customers. With a rapidly digitizing market, we believe there is a significant opportunity to continue to grow our customer base.
We create an environment where people can bring their whole, authentic selves to work and that reflects the diversity of the world we are helping to improve. • Win as a team . We win together, celebrate together, and support each other.
We create an environment where people can bring their whole, authentic selves to work and that reflects the diversity of the world we are helping to improve. • Win as a team . We win together, celebrate together, and support each other. We all operate with trust and respect, and are excited to build and contribute to Samsara’s community.
As more customers adopt our solution, we collect more data from a more diverse set of physical assets and third-party software applications, thereby improving our machine learning models and generating better operational insights that make our Connected Operations Cloud more attractive to customers. Customers typically adopt our solution to automate business processes and improve efficiencies throughout their organizations.
As more customers adopt our solution, we collect more data from a more diverse set of physical assets and third-party software applications, thereby improving our machine learning models and generating better operational insights that make our Connected Operations Platform more attractive to customers.
Examples of how customers use and benefit from our Connected Operations Cloud include 3 : • A Fortune Global 500 logistics company replaced seven separate point solutions with Samsara’s Connected Operations Cloud and achieved a 65% decrease in harsh driving incidents, a 26% reduction in accidents, and a 49% reduction in accident-related costs. • A Fortune Global 500 agricultural retailer saved over $1 million in hardware costs in just one year with vehicle OEM integrations while also reducing unsafe and distracted driving by 50% in just three months. • A Fortune 500 less-than-truckload carrier implemented Samsara workflows to increase driver efficiency and experienced a 99% week-over-week decrease in unassigned miles. • An international leader in low-carbon energy solutions improved its efficiency by automating the generation of 95% of their invoices, saving more than 8,500 hours annually and unlocking $30 million worth of revenue that was previously tied up in their invoicing process.
Examples of how customers use and benefit from our Connected Operations Platform include 2 : • A Fortune Global 500 logistics company replaced seven separate point solutions with Samsara’s Connected Operations Platform and achieved a 65% decrease in harsh driving incidents, a 26% reduction in accidents, and a 49% reduction in accident-related costs. • A Fortune 500 less-than-truckload carrier implemented Samsara workflows to increase driver efficiency and experienced a 99% week-over-week decrease in unassigned miles. • A leading communications technology provider saved over $1 million in fuel costs from improved visibility into fuel consumption and idling. • An international leader in low-carbon energy solutions improved its efficiency by automating the generation of 95% of their invoices, saving more than 8,500 hours annually and unlocking $30 million worth of revenue that was previously tied up in their invoicing process.
Our differentiated, purpose-built suite of Applications enables organizations to embrace and deploy a digital, cloud-connected strategy across their operations. With Samsara, customers have the ability to drive safer operations, increase business efficiency, and achieve their sustainability goals, all to improve the lives of their employees and the customers they serve. We provide an end-to-end solution for operations.
Powered by our massive data asset and expansive AI technology, our differentiated, purpose-built suite of Applications enables organizations to embrace and deploy a digital, cloud-connected strategy across their operations. With Samsara, customers have the ability to drive safer operations, increase business efficiency, and achieve their sustainability goals, all to improve the lives of their employees and the customers they serve.
We electronically file our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC.
Available Information Our website address is located at samsara.com and our investor relations website is located at investors.samsara.com. We electronically file our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC.
Our safety system leverages proprietary AI, embedded at the edge in IoT dash cameras, to detect safety events in real-time. By detecting risky behaviors like distracted driving or tailgating, our system can coach drivers using real-time in-cab audio alerts, and video can be captured in the cloud for personalized driver coaching. • Scoring and Reporting.
By detecting risky behaviors like distracted driving or tailgating, our system can coach drivers using real-time in-cab audio alerts, and video can be captured in the cloud for personalized driver coaching. • Scoring and Reporting.
Our Technology A Modern, Scalable Platform Our Connected Operations Cloud is purpose-built to scale and leverage modern technology. In today’s rapidly evolving technology environment, our multi-tenant SaaS platform gives us the agility to rapidly introduce new feature enhancements and the capacity to surface critical performance data based on our customers’ own preferences and analytical needs.
In today’s rapidly evolving technology environment, our cloud platform gives us the agility to rapidly introduce new feature enhancements and the capacity to surface critical performance data based on our customers’ own preferences and analytical needs.
We have created robust contingencies for data storage and low-power configurations to maintain a consistent data chain in the event of poor cellular connectivity or low power scenarios. The result of these connectivity configurations is more data in our Data Platform.
We have created robust contingencies for data storage and low-power configurations to maintain a consistent data chain in the event of poor cellular connectivity or low power scenarios. Our vehicle gateways include dual-SIM cards and can roam across multiple networks, further improving connectivity of our devices. The result of these connectivity configurations is more data in our Data Platform.
What Sets Us Apart • IoT Data Leader: A Network Effect. We believe that the quantity and diversity of IoT data types on our Connected Operations Cloud, together with the analytic insights that we provide our customers, differentiate us in the market. In fiscal year 2024, our Data Platform processed over nine trillion data points.
What Sets Us Apart • Growing Data Asset Feeds AI-Powered Platform. We believe the quantity and diversity of IoT data types on our Connected Operations Platform, together with the analytic insights we provide our customers, differentiate us in the market. In fiscal year 2025, our Data Platform processed over 14 trillion data points.
Our Solution We are helping drive the digital transformation of physical operations by enabling organizations with fleets, equipment, job sites, and frontline workers to connect real-time data from their physical operations on one platform.
Our business model focuses on maximizing the lifetime value of our customer relationships, and we continue to make significant investments to grow our customer base. Our Solution We are helping drive the digital transformation of physical operations by enabling organizations with fleets, equipment, job sites, and frontline workers to connect real-time data from their physical operations on one open platform.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Any failure to increase our revenue as we grow our business could prevent us from achieving our profitability targets, which would cause our business, financial condition, and results of operations to suffer. Additionally, we have granted restricted stock units (“RSUs”) to our employees and certain non-employees, with such RSUs vesting upon the satisfaction of certain vesting conditions.
Any failure to increase our revenue as we grow our business could prevent us from achieving our profitability targets, which would cause our business, financial condition, and results of operations to suffer. Additionally, we have granted restricted stock units (“RSUs”) to certain of our employees and non-employees, with such RSUs vesting upon the satisfaction of certain vesting conditions.
If any of our competitors implements new technologies before we can implement them or better anticipates the innovation and integration opportunities in related industries, our business may be adversely affected. Another part of our growth strategy is to sell additional subscriptions to existing customers as they increase their number of connected assets, such as machinery, vehicles, warehouses, and factories.
If any of our competitors implements new technologies before we can implement them or better anticipates the innovation and integration opportunities in related industries, our business may be adversely affected. Another part of our growth strategy is to sell additional subscriptions to existing customers as they increase their number of connected assets, such as vehicles, machinery, warehouses, and factories.
We expect to continue making significant expenditures on sales, hiring, and marketing efforts, and expenditures to develop new features, integrations, capabilities, and enhancements to our solution and further expand the use cases addressed by our Applications.
We expect to continue making significant expenditures on hiring, sales, and marketing efforts, and expenditures to develop new features, integrations, capabilities, and enhancements to our solution and further expand the use cases addressed by our Applications.
Interruptions or performance problems with either our technology and infrastructure or our data center hosting facilities could, among other things: • result in the destruction or disruption of any of our critical business operations, controls, or procedures or IT systems; • severely affect our ability to conduct normal business operations; • result in a material weakness in our internal control over financial reporting; • cause our customers to terminate their subscriptions; • result in our issuing credits or paying penalties or fines; • harm our brand and reputation; • adversely affect our renewal rates or our ability to attract new customers; or • cause our solution to be perceived as not being secure.
Interruptions or performance problems with either our technology and infrastructure or our data center hosting facilities could, among other things: • result in the destruction or disruption of any of our critical business operations, controls, or procedures or IT systems; • severely affect our ability to conduct normal business operations; • result in a material weakness in our internal control over financial reporting; • result in our issuing credits or paying penalties or fines; • cause our customers to terminate their subscriptions; • harm our brand and reputation; • adversely affect our renewal rates or our ability to attract new customers; or • cause our solution to be perceived as not being secure.
The introduction of new technologies will continue to have a significant effect on competitive conditions to which we are subject. In order to continue to provide value for our customers, we must offer innovative Applications that allow our customers to track and manage their fleets, equipment, sites, and other connected assets on a timely basis.
The introduction of new technologies will continue to have a significant effect on the competitive conditions to which we are subject. In order to continue to provide value for our customers, we must offer innovative Applications that allow our customers to track and manage their fleets, equipment, sites, and other connected assets on a timely basis.
We may make these investments without being certain that they will result in products or enhancements that will be accepted by existing or prospective customers or that will achieve market acceptance.
We may make these investments without being certain that they will result in products or enhancements that will be accepted by existing or prospective customers or that they will achieve market acceptance.
We also believe that the importance of brand recognition will increase as competition in our market increases, and that brand and reputation are particularly important in the physical operations industry given the potential impact of any failure of our solution on the physical operations of our customers.
We also believe the importance of brand recognition will increase as competition in our market increases, and that brand and reputation are particularly important in the physical operations industry given the potential impact of any failure of our solution on the physical operations of our customers.
Our customers within the physical operations industry are particularly sensitive to the reliability of our solution because a failure or defect in our solution could have a significant impact on their business or employees, including leading to death, serious bodily injury, or noncompliance with applicable regulations.
Our customers within the physical operations industry are particularly sensitive to the reliability of our solution because a failure or defect in our solution could have a significant impact on their business or employees, including leading to noncompliance with applicable regulations, serious bodily injury, or death.
If we cannot license or develop alternative non-infringing substitutes for any infringing technology used in any aspect of our business, we would be forced to limit or stop sales of our solution and may be unable to compete effectively. Any of these results would adversely affect our business operations and financial condition.
If we cannot license or develop alternative non-infringing substitutes for any infringing technology used in any aspect of our business, we would be forced to limit or stop sales of our solution and may be unable to compete effectively. Any of these results would adversely affect our business, financial condition, and results of operations.
EEA regulators since have provided guidance regarding use of the SCCs, and on June 4, 2021, the European Commission issued new SCCs that are required to be implemented where appropriate. The EEA subsequently adopted an adequacy decision that also covers transfers of personal data to the United States under an alternative mechanism called the EU-U.S. Data Privacy Framework. The EU-U.S.
EEA regulators since have provided guidance regarding use of the SCCs, and on June 4, 2021, the European Commission issued new SCCs that are required to be implemented where appropriate. The European Commission subsequently adopted an adequacy decision that also covers transfers of personal data to the United States under an alternative mechanism called the EU-U.S. Data Privacy Framework.
Any actual or perceived security breach or incident affecting our Data Platform or other aspects of our systems, networks, or operations, such as any compromise of our IoT devices or any denial of service attack or other disruption to our Connected Operations Cloud, affecting data we or our service providers process or maintain, or affecting our customers’ equipment or operations could result in a loss of customer confidence in the security, integrity, or safety of our solution and damage to our brand and reputation, reduce the demand for our solution, disrupt our normal business operations, require us to spend material resources to correct the breach or incident and otherwise respond to it, expose us to legal liabilities, including claims and litigation by private parties, regulatory investigations and other proceedings, fines, penalties, and indemnity obligations, and materially and adversely affect our financial condition and results of operations.
Any actual or perceived security breach or incident affecting our platform or other aspects of our systems, networks, or operations, such as any compromise of our IoT devices, any denial of service attack, or any other disruption to our Connected Operations Platform, affecting data we or our service providers process or maintain, or affecting our customers’ equipment or operations, could result in a loss of customer confidence in the security, integrity, or safety of our solution and damage to our brand and reputation, reduce the demand for our solution, disrupt our normal business operations, require us to spend material resources to correct the breach or incident and otherwise respond to it, expose us to legal liabilities, including claims and litigation by private parties, regulatory investigations and other proceedings, fines, penalties, and indemnity obligations, and materially and adversely affect our business, financial condition, and results of operations.
Moreover, the use by our solution of software or other intellectual property licensed from third parties on a nonexclusive basis could limit our ability to differentiate our solution from products of our competitors and could inhibit our ability to provide the current level of service to existing customers. 40 Table of Contents Changes in or the loss of third-party licenses could lead to our solution becoming inoperable or the performance of our solution being materially reduced, resulting in the potential need to incur additional research and development costs to ensure continued performance of our solution or a material increase in the costs of licensing, and we may experience decreased demand for our solution.
Moreover, the use by our solution of software or other intellectual property licensed from third parties on a nonexclusive basis could limit our ability to differentiate our solution from products of our competitors and could inhibit our ability to provide the current level of service to existing or prospective customers. 40 Table of Contents Changes in or the loss of third-party licenses could lead to our solution becoming inoperable or the performance of our solution being materially reduced, resulting in the potential need to incur additional research and development costs to ensure continued performance of our solution or a material increase in the costs of licensing, and we may experience decreased demand for our solution.
In the event of a natural disaster, including a major earthquake, blizzard, flood, or hurricane, or a catastrophic event such as a fire, power loss, or telecommunications failure, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in development of our solution, lengthy interruptions in service, breaches of data security, and loss of critical data, all of which could have an adverse effect on our future results of operations.
In the event of a natural disaster, including a major earthquake, blizzard, flood, or hurricane, or a catastrophic event such as a fire, power loss, or telecommunications failure, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in development of our solution, lengthy interruptions in service, security breaches or incidents, and loss of critical data, all of which could have an adverse effect on our future results of operations.
We have undertaken certain efforts to conform transfers of personal data subject to the GDPR from the European Economic Area (“EEA”) to the United States and other jurisdictions based on our understanding of current regulatory obligations and the guidance of data protection authorities, including the use of SCCs approved by the European Commission; however, international data transfers may still be challenged in countries that have not received “adequacy” status from the European Commission.
We have undertaken certain efforts to conform transfers of personal data subject to the GDPR from the European Economic Area (“EEA”) to the United States and other relevant jurisdictions based on our understanding of current regulatory obligations and the guidance of data protection authorities, including the use of SCCs approved by the European Commission; however, international data transfers may still be challenged in countries that have not received “adequacy” status from the European Commission.
Our agreements with customers, channel partners, and other third parties have in some cases included indemnification provisions under which we agree to indemnify them for losses suffered or incurred as a result of claims of intellectual property infringement, misappropriation or violation, damages caused by us to property or persons, or other liabilities relating to or arising from our solution or other contractual obligations.
Our agreements with customers, channel or other partners, and other third parties have in some cases included indemnification provisions under which we agree to indemnify them for losses suffered or incurred as a result of claims of intellectual property infringement, misappropriation or violation, damages caused by us or subcontractors or partners to property or persons, or other liabilities relating to or arising from our solution or other contractual obligations.
However, we may prove unsuccessful either in developing new Applications or in expanding the set of third-party applications and devices with which our Applications integrate, particularly as we expand our solution into use cases that have not been our historical focus and as we continue to refine our efforts to hire, develop, and retain engineering talent.
However, we may prove unsuccessful either in developing new Applications or features or in expanding the set of third-party applications and devices with which our Applications integrate, particularly as we expand our solution into use cases that have not been our historical focus and as we continue to refine our efforts to hire, develop, and retain engineering talent.
For example, in the United States, fleet operators face numerous complex regulatory requirements, including, among others, electronic logging requirements; compliance, safety, and accountability driver safety scoring; limitations on HOS; and compliance and fuel tax reporting. If these regulatory requirements were reduced or eliminated, our Applications for the fleet use case would have reduced utility to our customers.
For example, in the United States, fleet operators face numerous complex regulatory requirements, including, among others, electronic logging requirements; compliance, safety, and accountability driver safety scoring; limitations on HOS; and compliance and fuel tax and emissions reporting. If these regulatory requirements were reduced or eliminated, our Applications for the fleet use case would have reduced utility to our customers.
In addition, we incur additional costs to comply with the disclosure requirements, including costs related to conducting diligence procedures to determine the sources of minerals that may be used in or necessary for the production of our IoT devices and, if applicable, potential changes to IoT devices, processes, or sources of supply as a consequence of such due diligence activities.
In addition, we incur additional costs to comply with the disclosure requirements, including costs related to conducting reasonable diligence procedures to determine the sources of minerals that may be used in or necessary for the production of our IoT devices and, if applicable, potential changes to IoT devices, processes, or sources of supply as a consequence of such due diligence activities.
We typically provide service-level commitments under our subscription agreements. If we fail to meet these contractual commitments, we could be obligated to provide credits for future service or face subscription termination with refunds of prepaid amounts, which would lower our revenue and harm our reputation, business, financial condition, and results of operations.
We typically provide service-level commitments under our subscription agreements. If we fail to meet these contractual commitments, we could be obligated to provide credits for future service or face subscription termination with prorated refunds of prepaid amounts, which would lower our revenue and harm our reputation, business, financial condition, and results of operations.
This concentrated control will limit or preclude the ability of holders of Class A common stock to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval.
This concentrated control will limit or preclude the ability of holders of Class A common stock to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other corporate transaction requiring stockholder approval.
If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline. We do not intend to pay dividends for the foreseeable future.
If one or more of these analysts cease coverage of our company or fail to regularly or accurately publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline. We do not intend to pay dividends for the foreseeable future.
All of these efforts will require us to invest significant financial and other resources. We have also experienced turnover in our sales and marketing teams, including within the senior leadership of those teams, which often results in costly training, operational inefficiency, and potential execution risks.
All of these efforts will require us to invest significant financial and other resources. We have also experienced turnover in our sales and marketing and supporting teams, including within the senior leadership of those teams, which often results in costly training, operational inefficiency, and potential execution risks.
We have experienced and expect to continue to experience rapid growth, which has placed, and may continue to place, significant demands on our management, operational, and financial resources and systems. In addition, we operate globally and sell subscriptions to our solution to customers in many countries, and we plan to continue to expand our operations internationally in the future.
We have experienced and expect to continue to experience rapid revenue growth, which has placed, and may continue to place, significant demands on our management, operational, and financial resources and systems. In addition, we operate globally and sell subscriptions to our solution to customers in many countries, and we plan to continue to expand our operations internationally in the future.
We have agreed in certain customer and channel partner contracts to indemnify customers and channel partners, and have accepted tenders for indemnification from certain of such customers, for expenses or liabilities they incur as a result of third-party intellectual property infringement claims associated with our solution.
We have agreed in certain customer and channel or other partner contracts to indemnify customers and channel or other partners, and have accepted tenders for indemnification from certain of such customers, for expenses or liabilities they incur as a result of third-party intellectual property infringement claims associated with our solution.
In any of these events, we, our customers, and our channel partners could be required to seek licenses from third parties in order to continue offering our solution, to re-engineer our solution, or to discontinue the sale of subscriptions to our solution in the event re-engineering cannot be accomplished on a timely basis.
In any of these events, we, our customers, and our channel or other partners could be required to seek licenses from third parties in order to continue offering our solution, to re-engineer our solution, or to discontinue the sale of subscriptions to our solution in the event re-engineering cannot be accomplished on a timely basis.
Where we have applicable insurance, it might not cover such claims, might not provide sufficient payments to cover all the costs to resolve one or more such claims, and might not continue to be available on terms acceptable to us (including premium increases or the imposition of large deductible or co-insurance requirements).
Where we have applicable insurance, it might not cover such claims, might not provide sufficient payments to cover all the costs to resolve one or more such claims, and might not continue to be available on terms acceptable to us (including premium increases or the imposition of large deductible or co-insurance requirements), or at all.
Failure to comply ourselves, to enable such compliance by our customers, or to obtain and maintain any required certifications would prevent current and potential customers from using our solution for such compliance purposes and would have an adverse impact on our ability to sell subscriptions to our solution, our business reputation, and our customer relationships.
Failure to comply ourselves, to enable such compliance by our customers, or to obtain and maintain any required certifications would prevent current and potential customers from using our solution for such compliance purposes and would have an adverse impact on our ability to renew and sell subscriptions to our solution, our business reputation, and our customer relationships.
We, our customers, and our channel partners may also be subject to suits by parties claiming infringement, misappropriation, or violation due to the reliance by our solution on certain open source software, and such litigation could be costly for us to defend or subject us to an injunction.
We, our customers, and our channel or other partners may also be subject to suits by parties claiming infringement, misappropriation, or violation due to the reliance by our solution on certain open source software, and such litigation could be costly for us to defend or subject us to an injunction.
If our employees were to intentionally abuse these platform controls and system tools, for example, by interfering with or altering our IoT devices or our customers’ connected assets and accessing our customers’ data, or otherwise violate company policies, our customers could be significantly harmed.
If our employees were to intentionally abuse or misuse these platform controls and system tools, for example, by interfering with or altering our IoT devices or our customers’ connected assets and accessing our customers’ data, or otherwise violate company policies, our customers could be significantly harmed.
In addition, our insurance against this liability may not be adequate to cover a potential claim and may be subject to exclusions, including the possibility that the insurer will deny coverage as to any future claim or exclude from our coverage such claims in policy renewals.
In addition, our insurance against liability may not be adequate to cover a potential claim and may be subject to exclusions, including the possibility that the insurer will deny coverage as to any future claim or exclude from our coverage such claims in policy renewals.
As part of our business, we process, store, and transmit our customers’ information and data as well as our own, including in our Data Platform, networks, and other systems, and we also rely on third parties that are not directly under our control to do so.
As part of our business, we process, store, and transmit our customers’ information and data as well as our own, including in our platform, devices, networks, and other systems, and we also rely on third parties that are not directly under our control to do so.
We expect competition to increase as other established and emerging companies, such as Motive, Netradyne, Platform Science, and Verkada, enter the markets in which we compete, as customer requirements evolve, as the regulatory landscape evolves, and as new products and services and technologies are introduced.
We expect competition to increase as other established and emerging companies, such as Netradyne, Platform Science, and Verkada, enter the markets in which we compete, as customer requirements evolve, as the regulatory landscape evolves, and as new products and services and technologies are introduced.
If we are unable to expand and successfully onboard our sales force and new sales and marketing leaders at sufficiently high levels, our ability to attract new customers may be harmed, and our business, financial condition, and results of operations would be adversely affected.
If we are unable to expand and successfully onboard our sales force and new sales leaders at sufficiently high levels, our ability to attract new customers may be harmed, and our business, financial condition, and results of operations would be adversely affected.
The promotion of our brand requires us to make substantial expenditures, and we anticipate that the expenditures will increase as our market becomes more competitive, as we expand into new markets, and as more sales are generated through our channel partners.
The promotion of our brand requires us to make substantial expenditures, and we anticipate the expenditures will increase as our market becomes more competitive, as we expand into new markets, and as more sales are generated through our channel partners.
Despite our significant efforts in asserting and maintaining control and compliance by these third parties, we may be held fully liable for third parties’ actions as fully as if they were a direct employee of ours.
Despite our significant efforts in asserting and maintaining control of and compliance by these third parties, we may be held liable for third parties’ actions as if they were a direct employee of ours.
Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate. Market opportunity estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate or that may change due to macroeconomic conditions or other unexpected trends.
Our estimates of market opportunity and market share, and our forecasts of market growth may prove to be inaccurate. Market opportunity and market share estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate or that may change due to macroeconomic conditions or other unexpected trends.
If we fail to effectively manage these risks associated with sales cycles, sales timing uncertainty, sales to large customers and collection of payment from our customers, our business, financial condition, and results of operations may be adversely affected.
If we fail to effectively manage these risks associated with sales cycles, sales timing uncertainty, and collection of payment from our customers, our business, financial condition, and results of operations may be adversely affected.
Our subscription model also makes it difficult for us to rapidly increase our revenue through additional sales in any period, as revenue from new customers must be recognized over the applicable subscription term.
Our subscription model also makes it more difficult for us to rapidly increase our revenue through additional sales in any period, as subscription revenue from new customers must be recognized over the applicable subscription term.
Any failure or perceived failure by us to comply with our posted privacy policies, our obligations to users or other third parties, or any other contractual or legal obligations, regulatory requirements, or other actual or asserted obligations relating to privacy, data protection, or data security, may result in governmental investigations or enforcement actions, litigation, claims, or public statements against us by consumer advocacy groups or others and could result in significant liability, cause our users to lose trust in us, and otherwise materially and adversely affect our reputation and business.
Any failure or perceived failure by us to comply with our posted privacy policies, our obligations to users or other third parties, or any other contractual or legal obligations, regulatory requirements, or other actual or asserted obligations relating to privacy, data protection, or cybersecurity, may result in governmental investigations or enforcement actions, litigation, claims, or public statements against us by consumer advocacy groups or others and could result in significant liability, cause our users to lose trust in us, and otherwise materially and adversely affect our reputation and business.
Further, any significant change to applicable laws, regulations or industry practices regarding the collection, use, retention, security or disclosure of data, or their interpretation, or any changes regarding the manner in which the approval, authorization, agreement, and/or consent of users or other data subjects for the collection, use, retention, or disclosure of such data must be obtained or complied with, could increase our costs and require us to modify our Applications, possibly in a material manner, which we may be unable to complete, and may limit our ability to store and process user data or develop new Applications and features. 43 Table of Contents We also expect that there will continue to be new laws, regulations, and industry standards concerning privacy, data protection, and information security proposed and enacted in various jurisdictions.
Further, any significant change to applicable laws, regulations or industry practices regarding the collection, use, retention, security or disclosure of data, or their interpretation, or any changes regarding the manner in which the approval, authorization, agreement, and/or consent of users or other data subjects for the collection, use, retention, or disclosure of such data must be obtained or complied with, could increase our costs and require us to modify our Applications, possibly in a material manner, which we may be unable to complete, and may limit our ability to store and process user data or develop new Applications and features. 43 Table of Contents We also expect that there will continue to be new laws, regulations, executive orders, directives, and industry standards concerning privacy, data protection, and information security proposed and enacted in various jurisdictions.
Although our historical service credits have not been significant, any future service-level failures could also damage our reputation, which could also adversely affect our business, financial condition, and results of operations. 33 Table of Contents A real or perceived defect, security vulnerability, error, or performance failure in our Connected Operations Cloud could cause us to lose revenue, damage our reputation, and expose us to liability, and our product liability insurance may not adequately protect us.
Although our historical service credits have not been significant, any future service-level failures could also damage our reputation, which could also adversely affect our business, financial condition, and results of operations. 33 Table of Contents A real or perceived defect, security vulnerability, error, or performance failure in our Connected Operations Platform could cause us to lose revenue, damage our reputation, and expose us to liability, and our product liability insurance may not adequately protect us.
However, the regulatory framework for privacy, data protection and data security worldwide is, and is likely to remain for the foreseeable future, uncertain and complex, and it is possible that these or other actual or alleged obligations may be interpreted and applied in a manner that we do not anticipate or that is inconsistent from one jurisdiction to another and may conflict with other legal obligations or our practices.
However, the regulatory framework for privacy, data protection, and cybersecurity worldwide is, and is likely to remain for the foreseeable future, uncertain and complex, and it is possible that these or other actual or alleged obligations may be interpreted and applied in a manner that we do not anticipate or that is inconsistent from one jurisdiction to another and may conflict with other legal obligations or our practices.
In the future, increased levels of liquidity may be required to adequately support our operations and initiatives and to mitigate the effects of business challenges or unforeseen circumstances.
In the future, increased levels of liquidity may be required to adequately support our operations and strategic initiatives and to mitigate the effects of business challenges or unforeseen circumstances.
If we are unable to successfully enhance our Connected Operations Cloud to meet evolving customer requirements, increase adoption and use cases of our solution, and develop new Applications and features, then our business, financial condition, and results of operations would be adversely affected. 29 Table of Contents We rely on industry standards and technology developed and maintained outside of our control.
If we are unable to successfully enhance our Connected Operations Platform to meet evolving customer requirements, increase adoption and use cases of our solution, and develop new Applications and features, then our business, financial condition, and results of operations would be adversely affected. 29 Table of Contents We rely on industry standards and technology developed and maintained outside of our control.
To the extent that a third party were to develop software applications or IoT devices that compete with ours, that provider may choose not to support our solution.
To the extent that a third party were to develop software applications or IoT devices that compete with ours, that third party may choose not to support our solution.
Many factors may contribute to declines in our revenue growth rate, including increased competition, slowing demand for our solution from existing and new customers, a failure by us to continue capitalizing on growth opportunities, terminations of contracts, non-renewals of contracts or product returns by our existing customers, the maturation of our business, and macroeconomic factors, among others.
Many factors may contribute to declines in our revenue growth rate, including increased competition, slowing demand for our solution from existing and new customers, a failure by us to continue capitalizing on growth opportunities, terminations of contracts, full or partial non-renewals of contracts or product returns by our existing customers, the maturation of our business, and macroeconomic factors, among others.
Because our customers often must install IoT devices before being able to fully utilize our Connected Operations Cloud, any interruption or delay in the supply of any of these devices or components, or the inability to obtain these devices or components from alternate sources at acceptable prices and within a reasonable amount of time, would harm our ability to onboard new customers.
Because our customers often must install IoT devices before being able to fully utilize our Connected Operations Platform, any interruption or delay in the supply of any of these devices or components, or the inability to obtain these devices or components from alternate sources at acceptable prices and within a reasonable amount of time, would harm our ability to onboard new customers.
Further, as another example, on January 1, 2023, Canada began enforcement of its ELD technical standard, mandating that motor carriers and drivers subject to HOS requirements in Canada use ELDs that have been tested and certified by an accredited, third-party certification body. We have obtained certification for three of our ELD models in Canada.
Further, as another example, on January 1, 2023, Canada began enforcement of its ELD technical standard, mandating that motor carriers and drivers subject to HOS requirements in Canada use ELDs that have been tested and certified by an accredited, third-party certification body. We have obtained certification for all of our ELD models in Canada.
Any actual or perceived failure to comply with these United States privacy laws could result in a costly investigation or other proceedings by regulatory authorities or litigation by governmental authorities or private parties, each of which may result in potentially significant liability, loss of trust by our users, and a material and adverse impact on our reputation and business.
Any actual or perceived failure to comply with these United States privacy laws could result in a costly investigation or other proceedings by regulatory authorities or litigation by governmental authorities or private parties, each of which may result in potentially significant liability, loss of trust by our customers, and a material and adverse impact on our reputation and business.
There is no guarantee that any of these frameworks will survive any legal challenges and therefore, in light of this uncertainty, we will need to continue monitoring and taking appropriate steps to mitigate the impact on us with respect to the transfers of relevant personal data outside of the EU, United Kingdom, and Switzerland.
There is no guarantee that any of these frameworks will survive any legal challenges and therefore, in light of this uncertainty, we will need to continue monitoring and taking appropriate steps to mitigate the impact on us with respect to the transfers of relevant personal data outside of the EEA, United Kingdom, and Switzerland.
These efforts may prove more expensive than we currently anticipate, or we may not succeed in increasing our revenue sufficiently, or at all, to offset these higher expenses. Revenue growth may slow, or revenue may decline, for a number of possible reasons, including slowing demand for our Connected Operations Cloud or increasing competition, among other reasons.
These efforts may prove more expensive than we currently anticipate, or we may not succeed in increasing our revenue sufficiently, or at all, to offset these higher expenses. Revenue growth may slow, or revenue may decline, for a number of possible reasons, including slowing demand for our Connected Operations Platform or increasing competition, among other reasons.
Moreover, many of these vendors provide their services to us via a cloud-based model instead of software that is installed on our premises. As a result, we depend upon these vendors to provide us with services that are always available and are free of errors or defects that could cause disruptions in our business processes.
Moreover, many of these vendors provide their services to us via a cloud-based model instead of software that is installed on our premises. We depend upon these vendors to provide us with services that are always available and are free of errors or defects that could cause disruptions in our business processes.
The competitive position of our Connected Operations Cloud depends in part on its ability to operate with a wide variety of data sources and infrastructure, and if we are not successful in maintaining and expanding the compatibility of our solution with such data sources and infrastructure, our business, financial condition, and results of operations could be adversely impacted.
The competitive position of our Connected Operations Platform depends in part on its ability to operate with a wide variety of data sources and infrastructure, and if we are not successful in maintaining and expanding the compatibility of our solution with such data sources and infrastructure, our business, financial condition, and results of operations could be adversely impacted.
There can be no assurance that we will not incur significant costs to defend these claims or that we will not experience any product liability losses in the future. In addition, we generally provide our customers a hardware warranty for the entire term of their subscription to our Connected Operations Cloud.
There can be no assurance that we will not incur significant costs to defend these claims or that we will not experience any product liability losses in the future. In addition, we generally provide our customers a hardware warranty for the entire term of their subscription to our Connected Operations Platform.
These factors could materially and adversely affect our business, financial condition, and results of operations. 42 Table of Contents We are subject to stringent and changing laws, regulations, standards, and contractual obligations related to privacy, data protection, and data security. Any actual or perceived failure to comply with such obligations could harm our business.
These factors could materially and adversely affect our business, financial condition, and results of operations. 42 Table of Contents We are subject to stringent and changing laws, regulations, standards, and contractual obligations related to privacy, data protection, and cybersecurity. Any actual or perceived failure to comply with such obligations could harm our business.
As a result of actual or perceived noncompliance with government contracting laws, regulations, policies, or contractual provisions, we may be subject to audits and internal investigations which may prove costly to our business financially, divert management time, or limit our ability to continue selling subscriptions to our solution to our government customers.
As a result of actual or perceived noncompliance with government contracting laws, regulations, policies, contractual provisions, or other requirements, we may be subject to audits and internal investigations which may prove costly to our business financially, divert management time, or limit our ability to continue selling subscriptions to our solution to our government customers.
For example, in light of silicon component shortages, we expect that our suppliers’ larger volume customers will be able to exert more influence to purchase components from our suppliers than us, and accordingly, we bear significant risk if we are unable to successfully source components for our IoT devices.
For example, in light of silicon component shortages, we expect that our suppliers’ larger volume customers may be able to exert more influence to purchase components from our suppliers than us, and accordingly, we bear significant risk if we are unable to successfully source components for our IoT devices.
Any breach, incident, compromise, or failure of, or impacting, our systems or those of our third-party partners could result in the loss, corruption, or unavailability of our or our customers’ data, loss of intellectual property, someone obtaining unauthorized access to, modifying, exfiltrating, or otherwise processing without authorization our customers’ data or our data, or disrupting or obtaining unauthorized access to our Connected Operations Cloud or other systems.
Any breach, incident, compromise, or failure of, or impacting, our systems or those of our third-party partners could result in the loss, corruption, or unavailability of our or our customers’ data, loss of intellectual property, someone obtaining unauthorized access to, modifying, exfiltrating, or otherwise processing without authorization our customers’ data or our data, or someone disrupting or obtaining unauthorized access to our Connected Operations Platform or other systems.
If we are not able to maintain and enhance our brand, our business, financial condition, and results of operations may be harmed. We believe that maintaining and enhancing our reputation as a differentiated and category-defining company is critical to our relationships with our existing customers and to our ability to attract new customers.
If we are not able to maintain, enhance, and protect our brand, our business, financial condition, and results of operations may be harmed. We believe that maintaining, enhancing, and protecting our reputation as a differentiated and category-defining company is critical to our relationships with our existing customers and to our ability to attract new customers.
Additionally, potential government regulation related to AI use and ethics may expose us to legal liability and/or increase the burden and cost of research and development in this area, and failure to properly remediate AI usage or ethics issues may cause public confidence in AI to be undermined, which could slow adoption of AI in our solution.
Government regulation related to AI use and ethics may expose us to legal liability and/or increase the burden and cost of research and development in this area, and failure to properly remediate AI usage or ethics issues may cause public confidence in AI to be undermined, which could slow adoption of AI in our solution.
As a result, increased growth in the number of our customers could continue to result in our recognition of more costs than revenue in the earlier periods of the terms of certain of our customer contracts. Accordingly, we may not attain sufficient revenue to maintain positive cash flow from operations or achieve our profitability targets.
As a result, increased growth in the number of our customers could continue to result in our recognition of more costs than revenue in the earlier periods of the terms of certain of our customer contracts. Accordingly, we may not generate sufficient revenue to maintain positive cash flow from operations or achieve our profitability targets.
While our strategy of building Applications for use in connection with customers’ fleets has proven successful in the past, it is uncertain that we will achieve the same penetration and organic growth with respect to Applications for customers’ sites and equipment or any other use cases that we pursue.
While our strategy of building Applications for use in connection with customers’ fleets has proven successful in the past, it is uncertain that we will achieve the same penetration and organic growth with respect to Applications for customers’ sites, equipment, frontline workers, or any other use cases that we pursue.
To maintain or improve our results of operations, it is important that our customers renew their subscriptions to our Connected Operations Cloud when existing contract terms expire and that we expand our commercial relationships with our existing customers. Our contracts are typically for an initial subscription term of three to five years.
To maintain or improve our results of operations, it is important that our customers renew their subscriptions to our Connected Operations Platform when existing contract terms expire and that we expand our commercial relationships with our existing customers. Our contracts are typically for an initial subscription term of three to five years.
We receive, collect, store, process, transfer, and use personal information and other data relating to users of our solution, our employees and contractors, and other persons. For example, one of our Applications collects video of the worksites of our customers, and certain of our Applications collect and store facial recognition data, which is subject to heightened sensitivity and regulation.
We receive, collect, store, process, transfer, and use personal information and other data relating to users of our solution, our employees and contractors, and other persons. For example, one of our Applications collects video of the worksites of our customers, and certain of our Applications interact with facial recognition data, which is subject to heightened sensitivity and regulation.
If we are not able to develop and timely introduce new technologies for our Connected Operations Cloud that achieve market acceptance, keep pace with technological developments, and meet existing and emerging regulatory requirements, our business, financial condition, and results of operations would be harmed.
If we are not able to develop and timely introduce new technologies for our Connected Operations Platform that achieve market acceptance, keep pace with technological developments, and meet existing and emerging regulatory requirements, our business, financial condition, and results of operations would be harmed.
If Amazon decided to compete with us and did not allow us to renew our commercial agreement, this may have a significant impact on our solution and would require that we allocate time and expense to setting up our Connected Operations Cloud on an alternative hosting service.
If Amazon decided to compete with us and did not allow us to renew our commercial agreement, this may have a significant impact on our solution and would require that we allocate time and expense to setting up our Connected Operations Platform on an alternative hosting service.
Any abuse or misuse by our employees of our internal platform controls and system tools, even if inadvertent, could result in potential legal liability and reputational damage to both our customers and us. Accordingly, any improper conduct, abuse or misuse, intentional or otherwise, of our platform controls and system tools could significantly and adversely harm our business and reputation.
Any abuse or misuse by our employees of our internal platform controls and system tools, even if inadvertent, could result in potential legal liability and reputational damage to our customers, our partners, and us. Accordingly, any improper conduct, abuse or misuse, intentional or otherwise, of our platform controls and system tools could significantly and adversely harm our business and reputation.
The competitive position of our Connected Operations Cloud depends in part on its ability to operate with a wide array of physical sensors and devices—including IoT devices manufactured by us and by third parties, other software and database technologies, and communications, networking, computing, and other infrastructure.
The competitive position of our Connected Operations Platform depends in part on its ability to operate with a wide array of physical sensors and devices, including IoT devices manufactured by us and by third parties, other software and database technologies, and communications, networking, computing, and other infrastructure.
In addition, independent industry analysts provide reviews of our solution and our competitors’ products, which could influence the perception of the relative value of our Connected Operations Cloud in the marketplace. If these reviews are negative, or less positive as compared to those of our competitors’ products, our brand may be harmed.
In addition, independent industry analysts provide reviews of our solution and our competitors’ products, which could influence the perception of the relative value of our Connected Operations Platform in the marketplace. If these reviews are negative, or less positive as compared to those of our competitors’ products, our brand may be harmed.
Although we have extended our supply orders to the latest quoted lead times and have made preemptive spot purchases to build out our inventory, we cannot guarantee that we will have sufficient inventory for our needs or that future disruptions to our supply of IoT devices or materials will not occur.
Although we have extended our supply orders to the latest quoted lead times and have in the past made preemptive spot purchases to build out our inventory, we cannot guarantee that we will have sufficient inventory for our needs or that future disruptions to our supply of IoT devices or materials will not occur.
For example, as a result of the ongoing conflict between Russia and Ukraine, the U.S. government has issued a “Shields Up” alert and other warnings for American organizations noting the potential for Russia’s cyberattacks on Ukrainian government and critical infrastructure organizations to impact organizations in the United States.
For example, as a result of the ongoing conflict between Russia and Ukraine, the U.S. government issued a “Shields Up” alert in 2022 and other warnings for American organizations noting the potential for Russia’s cyberattacks on the Ukrainian government and critical infrastructure organizations to impact organizations in the United States.
If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, or changing customer needs, requirements or preferences, our Connected Operations Cloud may become less competitive. The industries in which we operate are subject to rapid technological change.
If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, or changing customer needs, requirements or preferences, our Connected Operations Platform may become less competitive. The industries in which we operate are subject to rapid technological change.
Any failure of our IoT devices to be compatible or comply with the hardware, software, or infrastructure—including wireless communications standards—utilized by our customers could prevent or delay their implementation of our Connected Operations Cloud and require costly and time-consuming engineering changes.
Any failure of our IoT devices to be compatible or comply with the hardware, software, or infrastructure—including wireless communications standards—utilized by our customers could prevent or delay their implementation of our Connected Operations Platform and require costly and time-consuming engineering changes.
Specifically, the CCPA provides that covered companies must provide new disclosures to California consumers and afford such consumers new data privacy rights that include the right to request a copy from a covered company of the personal information collected about them, the right to request deletion of such personal information, and the right to request to opt-out of certain sales of such personal information.
Specifically, the CCPA requires that covered companies must provide new disclosures to California consumers and afford such consumers new data privacy rights that include the right to request a copy from a covered company of the personal information collected about them, the right to request deletion of such personal information, and the right to request to opt-out of certain sales of such personal information.
For example, our main corporate offices are located in California, a state that frequently experiences earthquakes. Additionally, any natural disaster, power outage, connectivity issue, or other event could adversely affect the ability of our remote employees to work.
For example, our main corporate offices are located in California, a state that frequently experiences earthquakes and fires. Additionally, any natural disaster, power outage, connectivity issue, or other event could adversely affect the ability of our remote employees to work.
However, our customers have no obligation to renew their subscriptions after the initial terms expire, and our customers might not renew their subscriptions for a similar contract period, on the same payment terms, with the same or greater number of Applications and IoT devices, or at all.
However, our customers have no obligation to renew their subscriptions after the initial terms expire, and our customers might not renew any or all of their subscriptions for a similar contract period, at the same price, on the same payment terms, with the same or greater number of Applications and IoT devices, or at all.
If we are unsuccessful in these efforts, our ability to grow our business will be limited, and our business, results of operations, prospects, and financial condition will be adversely affected. Our current system of direct sales may not prove effective in maximizing sales of subscriptions to access our Connected Operations Cloud.
If we are unsuccessful in these efforts, our ability to grow our business will be limited, and our business, results of operations, prospects, and financial condition will be adversely affected. Our current system of direct sales may not prove effective in maximizing sales of subscriptions to access our Connected Operations Platform.
Sales to larger customers involve risks that may not be present or that are present to a lesser extent with sales to smaller organizations, such as longer sales cycles (which typically last several months and, in some cases, have exceeded one year), more complex customer product requirements and expectations related to invoicing and payment terms, substantial upfront sales costs, and less predictability in completing some of our sales.
Sales to larger customers involve risks that may not be present or that are present to a lesser extent with sales to smaller organizations, such as longer sales cycles (which typically last several months and, in some cases, have exceeded one year), more complex customer product requirements and expectations related to invoicing and payment and other commercial and contractual terms, substantial upfront sales costs, and less predictability in completing some of our sales.
Alternatively, insufficient supply levels may lead to shortages that result in delayed revenue or loss of sales opportunities altogether as potential end customers are unable to access our Connected Operations Cloud and, as a result, turn to competitors’ products that are readily available.
Alternatively, insufficient supply levels may lead to shortages that result in delayed revenue or loss of sales opportunities altogether as potential end customers are unable to access our Connected Operations Platform and, as a result, turn to competitors’ products that are readily available.
In addition, given the costs, effort, risks, and downside of obtaining patent protection, including the requirement to ultimately disclose the invention to the public, we may choose not to seek patent protection for certain innovations; however, such patent protection could later prove to be important to our business.
In addition, given the costs, effort, risks, and downsides of obtaining patent protection, including the requirement to ultimately disclose the invention to the public, we may choose not to seek patent protection for certain innovations; however, such patent protection could later prove to be important to our business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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For additional information regarding whether any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors,” including “Risk Factors—Risks Related to Our Business, Industry, and Operations: If we experience a security breach or incident affecting our customers’ assets or data, our data or IoT devices, our Data Platform, or other systems, our Connected Operations Cloud may be perceived as not being secure or safe, our reputation may be harmed, and our business could be materially and adversely affected.” and elsewhere in this Annual Report on Form 10-K.
For additional information regarding whether any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition, please refer to Item 1A, “Risk Factors,” including “Risk Factors—Risks Related to Our Business, Industry, and Operations: If we experience a security breach or incident affecting our customers’ assets or data, our data or IoT devices, our Data Platform, or other systems, our Connected Operations Platform may be perceived as not being secure or safe, our reputation may be harmed, and our business could be materially and adversely affected.” and elsewhere in this Annual Report on Form 10-K.
We are regularly audited and assessed pursuant to the System and Organization Controls (SOC 2) established by the American Institute of Certified Public Accountants for reporting on internal control environments implemented within an organization.
Additionally, we are regularly audited and assessed pursuant to the System and Organization Controls (SOC 2) established by the American Institute of Certified Public Accountants for reporting on internal control environments implemented within an organization.
He also has a Master of Business Administration degree. Our CISO is supported by a team of personnel with experience in cybersecurity, including at other public companies in the technology industry. 63 Table of Contents Our CISO oversees our cybersecurity policies and processes, including those described in the section titled “Risk Management and Strategy” above.
He also has a Master of Business Administration degree. Our CISO is supported by a team of personnel with experience in cybersecurity, including at other public companies in the technology industry. Our CISO oversees our cybersecurity policies and processes, including those described in the section titled “Risk Management and Strategy” above.
The processes by which our CISO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity incidents include the following: • Ongoing threat intelligence monitoring aimed at helping Samsara identify threats that may impact Samsara’s production and information environments; • Mechanisms for real-time or otherwise prompt reporting through multiple channels, including e-mail and instant messaging to a team of on-call incident responders; • Supplemental retrospective reviews of reported incidents to identify trends and track resolution of incidents identified during the incident review process; • Routine product reviews to assess progress on key security initiatives, along with assessing existing and emerging product-related risks; and • Annual tabletop exercises in which we test our incident response procedures with management representatives from across the company.
The processes by which our CISO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity incidents include the following: • Ongoing threat intelligence monitoring aimed at helping Samsara identify threats that may impact Samsara’s production and information environments; • Mechanisms for real-time or otherwise prompt reporting through multiple channels, including e-mail and instant messaging to a team of on-call incident responders; • Supplemental retrospective reviews of reported incidents to identify trends and track resolution of incidents identified during the incident review process; • Routine product reviews to assess progress on key security initiatives, along with assessing existing and emerging product-related risks; and • Annual tabletop exercises in which we test our incident response procedures with management representatives from across the company. 64 Table of Contents Our CISO provides periodic briefings to our Audit Committee regarding cybersecurity risks and activities, including recent cybersecurity incidents and related responses, cybersecurity systems testing, cybersecurity training efficacy, and cybersecurity risks.
As part of our overall risk management system, we regularly monitor and test our safeguards and train our personnel on these and other safeguards, in collaboration with our human resources, business technology, and management teams. Personnel across the company are made aware of our cybersecurity policies and procedures through training.
As part of our overall risk management system, we regularly monitor and test our safeguards and train our personnel on these and other safeguards, in collaboration with our human resources, business technology, and management teams.
In addition, our CISO provides periodic briefings to the Board of Directors on cybersecurity risks and activities.
As necessary, our Audit Committee provides periodic updates to our Board of Directors on such reports. In addition, our CISO provides periodic briefings to the Board of Directors on cybersecurity risks and activities.
For example, to advance and demonstrate our commitment to data security and privacy, we have achieved four cybersecurity-related certifications under standards promulgated by the International Organization for Standardization (ISO).
Personnel across the company are made aware of our cybersecurity policies and procedures through training. 63 Table of Contents To advance and demonstrate our commitment to data security and privacy, we have achieved four cybersecurity-related certifications under standards promulgated by the International Organization for Standardization (ISO).
We routinely assess material risks from cybersecurity threats, including any potential unauthorized activity on or conducted through our production and information systems that may result in adverse effects on the confidentiality, integrity, or availability of our systems or any information residing therein. 62 Table of Contents We routinely conduct risk assessments to identify cybersecurity threats, as well as assessments in the event of a material change that may affect production and information systems that are vulnerable to such cybersecurity threats and assessments in the event Samsara-specific or industrywide relevant vulnerabilities are discovered.
We routinely assess material risks from cybersecurity threats, including any potential unauthorized activity on or conducted through our production and information systems that may result in adverse effects on the confidentiality, integrity, or availability of our systems or any information residing therein.
Removed
Our CISO provides periodic briefings to our Audit Committee regarding cybersecurity risks and activities, including recent cybersecurity incidents and related responses, cybersecurity systems testing, cybersecurity training efficacy, and cybersecurity risks. As necessary, our Audit Committee provides periodic updates to our Board of Directors on such reports.
Added
We routinely conduct risk assessments to identify cybersecurity threats, as well as assessments in the event of a material change that may affect production and information systems that are vulnerable to such cybersecurity threats and assessments in the event Samsara-specific or industrywide relevant vulnerabilities are discovered.

Item 2. Properties

Properties — owned and leased real estate

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As of February 3, 2024, our principal offices consisted of approximately 133,000 square feet of leased property in San Francisco, California. We also lease office space for our operations in various locations throughout the United States, as well as office space in a number of countries in Europe, North America, and Asia.
As of February 1, 2025, our principal offices consisted of approximately 133,000 square feet of leased property in San Francisco, California. We also lease office space for our operations in various locations throughout the United States, as well as office space in a number of countries in Europe, North America, and Asia.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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For additional information on legal proceedings, refer to the section titled “Litigation” under Note 9, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Item 4. Mine Safety Disclosures Not applicable. 64 Table of Contents PART II
For additional information on legal proceedings, refer to the section titled “Litigation” under Note 9, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Item 4. Mine Safety Disclosures Not applicable. 65 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Issuer Purchases of Equity Securities None. 65 Table of Contents Stock Performance Graph The following shall not be deemed “soliciting material” or deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section, and shall not be deemed to be incorporated by reference into any of our other filings under the Exchange Act or the Securities Act.
Issuer Purchases of Equity Securities None. 66 Table of Contents Stock Performance Graph The following shall not be deemed “soliciting material” or deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section, and shall not be deemed to be incorporated by reference into any of our other filings under the Exchange Act or the Securities Act.
Because many of our shares of Class A common stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these holders. • Class B common stock: 42 stockholders of record. • Class C common stock: There were no shares outstanding.
Because many of our shares of Class A common stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these holders. • Class B common stock: 35 stockholders of record. • Class C common stock: There were no shares outstanding.
The performance graph below compares (i) the cumulative total return on our Class A common stock from December 15, 2021 (the date our Class A common stock commenced trading on the New York Stock Exchange) through February 3, 2024 (the last day in our fiscal year 2024) with (ii) the cumulative total return of the S&P 500 Index and the S&P 500 Information Technology Index over the same period, assuming the investment of $100 in our Class A common stock and in both of the other indices on December 15, 2021 and the reinvestment of dividends.
The performance graph below compares (i) the cumulative total return on our Class A common stock from December 15, 2021 (the date our Class A common stock commenced trading on the New York Stock Exchange) through February 1, 2025 (the last day in our fiscal year 2025) with (ii) the cumulative total return of the S&P 500 Index and the S&P 500 Information Technology Index over the same period, assuming the investment of $100 in our Class A common stock and in both of the other indices on December 15, 2021 and the reinvestment of dividends.
Securities Authorized for Issuance under Equity Compensation Plans The information required by this item is incorporated herein by reference to the definitive proxy statement for our annual meeting of stockholders, which will be filed with the SEC within 120 days of our fiscal year ended February 3, 2024. Unregistered Sales of Equity Securities None.
Securities Authorized for Issuance under Equity Compensation Plans The information required by this item is incorporated herein by reference to the definitive proxy statement for our annual meeting of stockholders, which will be filed with the SEC within 120 days of our fiscal year ended February 1, 2025. Unregistered Sales of Equity Securities None.
Our Class B and Class C common stock are neither listed nor publicly traded. Holders of Record Holders of our common stock as of February 3, 2024 were as follows: • Class A common stock: 41 stockholders of record.
Our Class B and Class C common stock are neither listed nor publicly traded. Holders of Record Holders of our common stock as of February 1, 2025 were as follows: • Class A common stock: 45 stockholders of record.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Our solution is used by businesses of varying sizes across a broad range of industries that depend on physical operations, including: transportation, construction, wholesale and retail trade, field services, logistics, utilities and energy, government, healthcare and education, manufacturing, food and beverage, and others.
Our solution is used by businesses of varying sizes across a broad range of industries that depend on physical operations, including: transportation, construction, wholesale and retail trade, field services, logistics, manufacturing, utilities and energy, government, healthcare and education, food and beverage, and others.
Sales and Marketing Sales and marketing expenses consist primarily of employee-related costs directly associated with our sales and marketing activities, including salaries, employee benefits and stock-based compensation, and sales commissions.
Sales and Marketing Sales and marketing expenses consist primarily of employee-related costs directly associated with our sales and marketing activities, including salaries, employee benefits, stock-based compensation, and sales commissions.
Critical Accounting Policies and Estimates Our consolidated financial statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K are prepared in accordance with GAAP. We believe that the following accounting policies involve a high degree of judgment and complexity.
Critical Accounting Estimates Our consolidated financial statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K are prepared in accordance with GAAP. We believe that the following accounting policies involve a high degree of judgment and complexity.
These costs are directly related to customer contracts and are expected to be recoverable and enhance the resources used to satisfy the undelivered performance obligations in those contracts. These contract fulfillment costs are amortized over a period of benefit of five years.
These costs are directly related to customer contracts, are expected to be recoverable, and enhance the resources used to satisfy the undelivered performance obligations in those contracts. These contract fulfillment costs are amortized over a period of benefit of five years.
A subscription to our Connected Operations Cloud includes IoT data collection, which usually comes from a Samsara IoT device, such as an internet gateway, camera or sensor, or at times from a third-party solution; cellular connectivity for our IoT devices; access to our cloud Applications, application programming interfaces, and the Samsara App Marketplace; customer support; and warranty coverage.
A subscription to our Connected Operations Platform includes IoT data collection, which usually comes from a Samsara IoT device, such as an internet gateway, camera or sensor, or at times from a third-party solution; cellular connectivity for our IoT devices; access to our cloud Applications, application programming interfaces, and the Samsara App Marketplace; customer support; and warranty coverage.
Our Connected Operations Cloud consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights, using our cloud dashboard, custom alerts and reports, mobile apps, and workflows.
Our Connected Operations Platform consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights using our cloud dashboard, custom alerts and reports, mobile apps, and workflows.
Interest Income and Other Income (Expense), Net Interest income and other income (expense), net, consists primarily of income earned on our money market funds included in cash and cash equivalents, restricted cash, and our short-term and long-term investments, including amortization of premiums and accretion of discounts related to our marketable debt securities, net of associated fees.
Interest Income and Other Income, Net Interest income and other income, net, consists primarily of income earned on our money market funds included in cash and cash equivalents, restricted cash, and our short-term and long-term investments, including amortization of premiums and accretion of discounts related to our marketable debt securities, net of associated fees.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Please read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and related notes included under Part II, Item 8 of this Annual Report on Form 10-K.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Please read the following discussion and analysis of our financial condition and results of operations together with our audited consolidated financial statements and related notes included under Part II, Item 8 of this Annual Report on Form 10-K.
ARR should be viewed independently of revenue and is not intended to be combined with or replace it. ARR is not a forecast, and the active contracts at the date used in calculating ARR may or may not be extended or renewed.
ARR should be viewed independently of revenue and is not intended to be combined with or replace it. ARR is not a forecast, and the active contracts at the date used in calculating ARR may or may not be renewed.
Cash used in operating activities mainly consists of our net loss adjusted for certain non-cash items, including stock-based compensation, net accretion of discounts on marketable debt securities, depreciation and amortization of property and equipment, lease modification, impairment, and related charges, non-cash legal settlement, and non-cash operating lease costs, and changes in operating assets and liabilities during each period.
Cash provided by (used in) operating activities mainly consists of our net loss adjusted for certain non-cash items, including stock-based compensation, depreciation and amortization of property and equipment, net accretion of discounts on marketable debt securities, lease modification, impairment, and related charges, non-cash legal settlement, and non-cash operating lease costs, and changes in operating assets and liabilities during each period.
Our ability to expand within our customer base will depend on a number of factors, including our customers’ satisfaction, pricing, competition, macroeconomic factors, and changes in our customers’ spending levels. Investments in Innovation and Future Growth Our performance is driven by continuous innovation on our Connected Operations Cloud and our ability to scale our headcount to grow our business.
Our ability to expand within our customer base will depend on a number of factors, including our customers’ satisfaction, pricing, competition, macroeconomic factors, and changes in our customers’ spending levels. Investments in Innovation and Future Growth Our performance is driven by continuous innovation on our Connected Operations Platform and our ability to scale our headcount to grow our business.
Factors Affecting Our Performance Acquiring New Customers We believe that we have a substantial opportunity to continue to grow our customer base. We intend to drive new customer acquisition by continuing to invest significantly in sales and marketing to engage our prospective customers, increase brand awareness, and drive adoption of our Connected Operations Cloud.
Factors Affecting Our Performance Acquiring New Customers We believe that we have a substantial opportunity to continue to grow our customer base. We intend to drive new customer acquisition by continuing to invest significantly in sales and marketing to engage our prospective customers, increase brand awareness, and drive adoption of our Connected Operations Platform.
Our subscription contracts transfer title to the connected device to the customer upon shipment and are invoiced monthly, quarterly, annually, or in advance. Connected Device Costs We capitalize connected device costs associated with subscription contracts as contract fulfillment costs where the connected device is not distinct from other undelivered obligations in the customer contract.
Our subscription contracts typically transfer title to the connected device to the customer upon shipment and are invoiced monthly, quarterly, semi-annually, annually, or in advance. Connected Device Costs We capitalize connected device costs associated with subscription contracts as contract fulfillment costs where the connected device is not distinct from other undelivered obligations in the customer contract.
Our primary uses of cash include personnel-related costs, third-party cloud infrastructure expenses, sales and marketing expenses, overhead costs, and funding other working capital requirements, such as inventory and connected device costs to meet our performance obligations related to our Connected Operations Cloud. 77 Table of Contents Our future capital requirements will depend on many factors, including, but not limited to, our growth, our ability to attract and retain customers, the continued market acceptance of our solution, the timing and extent of spending necessary to support our efforts to develop our Connected Operations Cloud and meet our performance obligations related to our Connected Operations Cloud, the expansion of sales and marketing activities, and the impact of macroeconomic conditions on our and our customers’ and partners’ businesses.
Our primary uses of cash include personnel-related costs, third-party cloud and cellular infrastructure costs, sales and marketing expenses, overhead costs, and funding other working capital requirements, such as inventory and related connected device costs to meet our performance obligations related to our Connected Operations Platform. 78 Table of Contents Our future capital requirements will depend on many factors, including, but not limited to, our growth, our ability to attract and retain customers, the continued market acceptance of our solution, the timing and extent of spending necessary to support our efforts to develop our Connected Operations Platform and meet our performance obligations related to our Connected Operations Platform, the expansion of sales and marketing activities, and the impact of macroeconomic conditions on our and our customers’ and partners’ businesses.
We continuously invest in adding new data types to our Connected Operations Cloud and innovate with this growing data asset to introduce new Applications over time. Our performance is also impacted by our ability to scale our headcount across our business to support our growth.
We continuously invest in adding new data types to our Connected Operations Platform and innovate with this growing data asset to introduce new Applications over time. Our performance is also impacted by our ability to scale our headcount across our business to support our growth.
Our Connected Operations Cloud and IoT devices are highly interdependent and interrelated, and represent a combined performance obligation within the context of the contract. In each of our past two fiscal years, we generated approximately 98% of our revenue from subscriptions to our Connected Operations Cloud.
Our Connected Operations Platform and IoT devices are highly interdependent and interrelated, and represent a combined performance obligation within the context of the contract. In each of our past two fiscal years, we generated approximately 98% of our revenue from subscriptions to our Connected Operations Platform.
Expanding Within Our Existing Customer Base We believe that there is a significant opportunity to expand sales to existing customers following their initial adoption of our Connected Operations Cloud. We expand within our customer base by selling more Applications and expanding existing Applications across geographies and divisions.
Expanding Within Our Existing Customer Base We believe that there is a significant opportunity to expand sales to existing customers following their initial adoption of our Connected Operations Platform. We expand within our customer base by selling more Applications and expanding existing Applications across geographies and divisions.
We offer subscriptions to access our Connected Operations Cloud. Customers subscribe to one or more Applications on our Connected Operations Cloud which includes data that is primarily provided by various proprietary connected device access points, including telematic sensors, gateways, and cameras.
We offer subscriptions to access our Connected Operations Platform. Customers subscribe to one or more Applications on our Connected Operations Platform which includes data that is primarily provided by various proprietary connected device access points, including telematic sensors, gateways, and cameras.
As our customers expand and increase the use of our Connected Operations Cloud driven by additional IoT devices and Applications, our cost of revenue may vary from quarter to quarter as a percentage of our revenue due to the timing and extent of these expenses.
As our customers expand and increase the use of our Connected Operations Platform driven by additional IoT devices and Applications, our cost of revenue may vary from quarter to quarter as a percentage of our revenue due to the timing and extent of these expenses.
We continue to focus our research and development efforts on adding new features and products and enhancing the utility of our Connected Operations Cloud. We capitalize the portion of our internal-use software development costs that meets the criteria for capitalization.
We continue to focus our research and development efforts on adding new features and products and enhancing the utility of our Connected Operations Platform. We capitalize the portion of our internal-use software development costs that meets the criteria for capitalization.
Accordingly, the fixed consideration related to the combined performance obligation is recognized on a straight-line basis over the contract term, beginning on the date that access to the Connected Operations Cloud or specified application and connected device is provided.
Accordingly, the fixed consideration related to the combined performance obligation is recognized on a straight-line basis over the contract term, beginning on the date that access to the Connected Operations Platform or specified application and connected device is provided.
We intend to continue to invest additional resources in our Connected Operations Cloud and customer support and operations personnel as we grow our business. The level and timing of investment in these areas will affect our cost of revenue in the future.
We intend to continue to invest additional resources in our Connected Operations Platform and customer support and operations personnel as we grow our business. The level and timing of investment in these areas will affect our cost of revenue in the future.
This section of our Annual Report on Form 10-K generally discusses our financial condition and results of operations for fiscal years 2024 and 2023, and year-to-year comparisons between fiscal years 2024 and 2023 in accordance with GAAP.
This section of our Annual Report on Form 10-K generally discusses our financial condition and results of operations for fiscal years 2025 and 2024, and year-to-year comparisons between fiscal years 2025 and 2024 in accordance with GAAP.
We determined that the subscription and connected device access points fulfill a single promise to the customer because the Connected Operations Cloud and connected devices are interdependent and interrelated to maintaining the intended utility of the subscription over the contractual term.
We determined that the subscription and connected device access points fulfill a single promise to the customer because the Connected Operations Platform and connected devices are interdependent and interrelated to maintaining the intended utility of the subscription over the contractual term.
Our customer counts fluctuate from period to period, including due to customer mergers, acquisitions, consolidations, spin-offs, and other market activity. We have a very diverse customer base and no significant customer concentration, with no single customer accounting for more than 1% of our ARR as of February 3, 2024.
Our customer counts fluctuate from period to period, including due to customer mergers, acquisitions, consolidations, spin-offs, and other market activity. We have a very diverse customer base and no significant customer concentration, with no single customer accounting for more than 1% of our ARR as of February 1, 2025.
Refer to the section titled “Risk Factors” for further discussion of the impacts of macroeconomic trends on our business. 69 Table of Contents Components of Results of Operations Revenue We provide access to our Connected Operations Cloud through subscription arrangements, whereby the customer is charged a per-subscription fee for access for a specified term.
Refer to the section titled “Risk Factors” for further discussion of the impacts of macroeconomic trends on our business. 70 Table of Contents Components of Results of Operations Revenue We provide access to our Connected Operations Platform through subscription arrangements, whereby the customer is charged a per-subscription fee for access for a specified term.
We intend to continue making investments in our business, and as a result, we may require additional capital resources to execute on our strategic initiatives to grow our business, particularly if we generate negative cash flows in future quarters.
We intend to continue investing in our business, and as a result, we may require additional capital resources to execute on our strategic initiatives to grow our business, particularly if we generate negative cash flows in future quarters.
We generally price our subscriptions on a per asset, per application basis. For example, one vehicle using two Applications (Video-Based Safety and Vehicle Telematics) would count as two subscriptions. Our Connected Operations Cloud is designed to be a digital hub for our customers and a mission-critical part of their operations.
We generally price our subscriptions on a per asset, per application basis. For example, one vehicle using two Applications (Video-Based Safety and Vehicle Telematics) would count as two subscriptions. 68 Table of Contents Our Connected Operations Platform is designed to be a digital hub for our customers and a mission-critical part of their operations.
Our Business Model In each of the past two fiscal years, we generated approximately 98% of our revenue from subscriptions to our Connected Operations Cloud, which today includes Applications for Video-Based Safety, Vehicle Telematics, Mobile Apps and Workflows, Equipment Monitoring, and Site Visibility.
Our Business Model In each of the past two fiscal years, we generated approximately 98% of our revenue from subscriptions to our Connected Operations Platform, which today includes Applications for Video-Based Safety, Vehicle Telematics, Workforce Apps, Equipment Monitoring, and Site Visibility.
Contractual Obligations and Commitments Our estimated future obligations consist of leases and non-cancelable purchase commitments as of February 3, 2024. For additional discussion on our leases and other commitments, refer to Notes 7, “Leases,” and 9, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Contractual Obligations and Commitments Our estimated future obligations consist of leases and non-cancelable purchase commitments as of February 1, 2025. For additional discussion on our leases and other commitments, refer to Notes 8, “Leases,” and 9, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
The increases in amortization of deferred IoT device costs and infrastructure costs were primarily due to increased sales volume year-over-year. The increase in cost of revenue was also due to an extra week in our fiscal year 2024.
The increases in amortization of IoT device costs and infrastructure costs were primarily due to increased sales volume year-over-year. The increase in cost of revenue was partially offset by an extra week in our fiscal year 2024.
A discussion of our financial condition and results of operations and our liquidity and capital resources for fiscal year 2022, and year-to-year comparisons between fiscal years 2023 and 2022 can be found under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended January 28, 2023 included in Part II, Item 7 of our Annual Report on Form 10-K filed with the SEC on March 21, 2023.
A discussion of our financial condition and results of operations and our liquidity and capital resources for fiscal year 2023, and year-to-year comparisons between fiscal years 2024 and 2023 can be found under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended February 3, 2024 included in Part II, Item 7 of our Annual Report on Form 10-K filed with the SEC on March 26, 2024.
Cost of Revenue Cost of revenue consists primarily of the amortization of IoT device costs associated with subscription agreements, cellular-related costs, third-party cloud infrastructure expenses, customer support costs, warranty charges, and employee-related costs directly associated with our customer support and operations, including salaries, employee benefits and stock-based compensation, amortization of internal-use software development and certain cloud computing implementation costs, expenses related to shipping and handling, packaging, fulfillment, warehousing, write-downs of excess and obsolete inventory, and allocated overhead costs.
Cost of Revenue Cost of revenue consists primarily of the amortization of IoT device costs associated with subscription agreements, third-party cloud and cellular infrastructure costs, customer support costs, warranty costs, and employee-related costs directly associated with our customer support and operations, including salaries, employee benefits and stock-based compensation, amortization of internal-use software development and certain cloud computing implementation costs, expenses related to shipping and handling, packaging, fulfillment, warehousing, write-downs of excess and obsolete inventory, and costs associated with software subscriptions, office facilities, IT-related expenses, and depreciation and amortization of property and equipment.
Specifically, our connected devices, including the embedded proprietary firmware, are updated continuously by our Connected Operations Cloud using artificial intelligence and machine learning models to improve the capture, aggregation, and enrichment of data by the connected devices.
Specifically, our connected devices, including the embedded proprietary firmware, are updated continuously by our Connected Operations Platform using AI and machine learning models to improve the capture, aggregation, and enrichment of data by the connected devices.
We believe that our existing cash, cash equivalents, and short-term and long-term investments will be sufficient to support working capital, including our non-cancelable arrangements, and capital expenditure requirements for at least the next 12 months. As of February 3, 2024, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments of $823.8 million.
We believe that our existing cash, cash equivalents, and short-term and long-term investments will be sufficient to support working capital, including our non-cancelable arrangements, and capital expenditure requirements for at least the next 12 months. As of February 1, 2025, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments of $977.5 million.
Investing Activities Cash used in investing activities was $78.7 million for the fiscal year ended February 3, 2024, which primarily consisted of $740.5 million of purchases of investments and $11.0 million of capital expenditures for internal-use software development costs and our office facilities, partially offset by $664.7 million of proceeds from maturities and redemptions of investments and $8.2 million of proceeds from sales of investments.
Investing Activities Cash used in investing activities was $66.6 million for the fiscal year ended February 1, 2025, which primarily consisted of $649.5 million of purchases of investments and $20.2 million of capital expenditures for internal-use software development costs and our office facilities, partially offset by $602.0 million of proceeds from maturities and redemptions of investments and $1.2 million of proceeds from sales of investments. 79 Table of Contents Cash used in investing activities was $78.7 million for the fiscal year ended February 3, 2024, which primarily consisted of $740.5 million of purchases of investments and $11.0 million of capital expenditures for internal-use software development costs and our office facilities, partially offset by $664.7 million of proceeds from maturities and redemptions of investments and $8.2 million of proceeds from sales of investments.
We recognize revenue from our subscriptions ratably over the term of the contract. We bill monthly, quarterly, semi-annually, annually, or in advance, depending on the specifics of each contract. 67 Table of Contents Our go-to-market strategy is focused on landing new customers and expanding their adoption of our Connected Operations Cloud.
We recognize revenue from our subscriptions ratably over the term of the contract. We bill monthly, quarterly, semi-annually, annually, or in advance, depending on the specific terms of each contract. Our go-to-market strategy is focused on landing new customers and expanding their adoption of our Connected Operations Platform.
The following table presents a reconciliation of our non-GAAP gross profit to our GAAP gross profit for the periods presented (in thousands, except percentages): Fiscal Year Ended February 3, 2024 January 28, 2023 January 29, 2022 Gross profit $ 690,353 $ 469,889 $ 303,861 Add: Stock-based compensation expense-related charges (1) 12,725 9,466 6,344 Non-GAAP gross profit $ 703,078 $ 479,355 $ 310,205 GAAP gross margin 74 % 72 % 71 % Non-GAAP gross margin 75 % 73 % 72 % __________ (1) Stock-based compensation expense-related charges included approximately $0.8 million, $0.3 million, and $0.3 million of employer taxes on employee equity transactions for the fiscal years ended February 3, 2024, January 28, 2023, and January 29, 2022, respectively. 75 Table of Contents Non-GAAP Income (Loss) from Operations and Non-GAAP Operating Margin We define non-GAAP income (loss) from operations, or non-GAAP operating income (loss), as income (loss) from operations excluding the effect of stock-based compensation expense-related charges, including employer taxes on employee equity transactions, lease modification, impairment, and related charges, and legal settlements.
The following table presents a reconciliation of our non-GAAP gross profit to our GAAP gross profit for the periods presented (in thousands, except percentages): Fiscal Year Ended February 1, 2025 February 3, 2024 January 28, 2023 Gross profit $ 950,878 $ 690,353 $ 469,889 Add: Stock-based compensation expense-related charges (1) 15,349 12,725 9,466 Non-GAAP gross profit $ 966,227 $ 703,078 $ 479,355 GAAP gross margin 76 % 74 % 72 % Non-GAAP gross margin 77 % 75 % 73 % __________ (1) Stock-based compensation expense-related charges included approximately $1.0 million, $0.8 million, and $0.3 million of employer taxes on employee equity transactions for the fiscal years ended February 1, 2025, February 3, 2024, and January 28, 2023, respectively. 76 Table of Contents Non-GAAP Income (Loss) from Operations and Non-GAAP Operating Margin We define non-GAAP income (loss) from operations, or non-GAAP operating income (loss), as income (loss) from operations excluding the effect of stock-based compensation expense-related charges, lease modification, impairment, and related charges, and legal settlements.
We believe that non-GAAP net income (loss) provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations.
We use non-GAAP net income (loss) in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP net income (loss) provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations.
Our fiscal year 2024 was a 53-week fiscal year, with the fourth quarter consisting of 14 weeks, and fiscal years 2023 and 2022 each consisted of 52 weeks, with the fourth quarter consisting of 13 weeks.
Our fiscal years 2025 and 2023 each consisted of 52 weeks, with the fourth quarter consisting of 13 weeks, and our fiscal year 2024 consisted of 53 weeks, with the fourth quarter consisting of 14 weeks.
The following table presents a reconciliation of free cash flow to net cash used in operating activities for the periods presented (in thousands, except percentages): Fiscal Year Ended February 3, 2024 January 28, 2023 January 29, 2022 Net cash used in operating activities $ (11,815) $ (103,021) $ (171,481) Purchase of property and equipment (10,953) (33,240) (19,353) Free cash flow (1) $ (22,768) $ (136,261) $ (190,834) Net cash used in operating activities margin (1) % (16) % (40) % Free cash flow margin (1) (2) % (21) % (45) % Net cash used in investing activities $ (78,687) $ (631,848) $ (20,035) Net cash provided by financing activities $ 20,997 $ 14,212 $ 701,644 __________ (1) Free cash flow includes the cash impact of non-recurring capital expenditures associated with the build-out of our corporate office facilities in San Francisco, California, net of tenant allowances, and legal settlements (in thousands): Fiscal Year Ended February 3, 2024 January 28, 2023 January 29, 2022 Purchase of property and equipment for build-out of corporate office facilities, net of tenant allowances (2) $ (10,179) $ 26,227 $ 11,096 Legal settlement (3) $ 60,000 $ — $ — (2) In April 2023, we settled a lease dispute which was primarily related to lease incentives associated with leasehold improvements in the form of a tenant allowance and received $11.3 million.
The following table presents a reconciliation of free cash flow to net cash provided by (used in) operating activities for the periods presented (in thousands, except percentages): Fiscal Year Ended February 1, 2025 February 3, 2024 January 28, 2023 Net cash provided by (used in) operating activities $ 131,659 $ (11,815) $ (103,021) Purchases of property and equipment (20,177) (10,953) (33,240) Free cash flow (1) $ 111,482 $ (22,768) $ (136,261) Net cash provided by (used in) operating activities margin 11 % (1 %) (16 %) Free cash flow margin (1) 9 % (2 %) (21 %) Net cash used in investing activities $ (66,621) $ (78,687) $ (631,848) Net cash provided by financing activities $ 27,101 $ 20,997 $ 14,212 __________ (1) Free cash flow includes the cash impact of non-recurring capital expenditures associated with the build-out of our corporate office facilities in San Francisco, California, net of tenant allowances, and legal settlements (in thousands): Fiscal Year Ended February 1, 2025 February 3, 2024 January 28, 2023 Purchases of property and equipment for build-out of corporate office facilities, net of tenant allowances (2) $ — $ (10,179) $ 26,227 Legal settlement (3) $ — $ 60,000 $ — (2) In April 2023, we settled a lease dispute which was primarily related to lease incentives associated with leasehold improvements in the form of a tenant allowance and received $11.3 million.
Our net loss was $286.7 million and $247.4 million for the fiscal years ended February 3, 2024 and January 28, 2023, respectively. Our business model focuses on maximizing the lifetime value of our customer relationships, and we continue to make significant investments to grow our customer base.
Our net loss was $154.9 million and $286.7 million for the fiscal years ended February 1, 2025 and February 3, 2024, respectively. Our business model focuses on maximizing the lifetime value of our customer relationships, and we continue to make significant investments to grow our customer base.
The following table presents a reconciliation of our non-GAAP net income (loss) to our GAAP net loss for the periods presented (in thousands, except percentages): Fiscal Year Ended February 3, 2024 January 28, 2023 January 29, 2022 Net loss $ (286,726) $ (247,422) $ (355,024) Add: Stock-based compensation expense-related charges 251,190 181,424 238,238 Lease modification, impairment, and related charges 4,762 1,056 1,532 Legal settlement 68,665 — — Non-GAAP net income (loss) (1) $ 37,891 $ (64,942) $ (115,254) __________ (1) There were no material income tax effects on our non-GAAP adjustments for all periods presented. 76 Table of Contents Free Cash Flow and Free Cash Flow Margin We define free cash flow as net cash used in operating activities reduced by cash used for purchases of property and equipment.
The following table presents a reconciliation of our non-GAAP net income (loss) to our GAAP net loss for the periods presented (in thousands, except percentages): Fiscal Year Ended February 1, 2025 February 3, 2024 January 28, 2023 Net loss $ (154,907) $ (286,726) $ (247,422) Add: Stock-based compensation expense-related charges 298,647 251,190 181,424 Lease modification, impairment, and related charges 4,028 4,762 1,056 Legal settlement 850 68,665 — Non-GAAP net income (loss) (1) $ 148,618 $ 37,891 $ (64,942) __________ (1) There were no material income tax effects on our non-GAAP adjustments for all periods presented. 77 Table of Contents Non-GAAP Liquidity Financial Measures Free Cash Flow and Free Cash Flow Margin We define free cash flow as net cash provided by (used in) operating activities reduced by cash used for purchases of property and equipment.
The following table presents a reconciliation of our non-GAAP income (loss) from operations to our GAAP loss from operations for the periods presented (in thousands, except percentages): Fiscal Year Ended February 3, 2024 January 28, 2023 January 29, 2022 Loss from operations $ (323,347) $ (259,455) $ (353,848) Add: Stock-based compensation expense-related charges (1) 251,190 181,424 238,238 Lease modification, impairment, and related charges 4,762 1,056 1,532 Legal settlement (2) 68,665 — — Non-GAAP income (loss) from operations $ 1,270 $ (76,975) $ (114,078) GAAP operating margin (34) % (40) % (83) % Non-GAAP operating margin 0 % (12) % (27) % __________ (1) Stock-based compensation expense-related charges included approximately $14.1 million, $4.0 million, and $9.5 million of employer taxes on employee equity transactions for the fiscal years ended February 3, 2024, January 28, 2023, and January 29, 2022, respectively.
The following table presents a reconciliation of our non-GAAP income (loss) from operations to our GAAP loss from operations for the periods presented (in thousands, except percentages): Fiscal Year Ended February 1, 2025 February 3, 2024 January 28, 2023 Loss from operations $ (189,973) $ (323,347) $ (259,455) Add: Stock-based compensation expense-related charges (1) 298,647 251,190 181,424 Lease modification, impairment, and related charges 4,028 4,762 1,056 Legal settlement (2) 850 68,665 — Non-GAAP income (loss) from operations $ 113,552 $ 1,270 $ (76,975) GAAP operating margin (15 %) (34 %) (40 %) Non-GAAP operating margin 9 % 0 % (12 %) __________ (1) Stock-based compensation expense-related charges included approximately $18.6 million, $14.1 million, and $4.0 million of employer taxes on employee equity transactions for the fiscal years ended February 1, 2025, February 3, 2024, and January 28, 2023, respectively.
For example, our business and results of operations could be affected by global macroeconomic trends and events such as inflationary pressure, interest rate increases and declines in consumer confidence, widespread disruptions of supply chains and freight and shipping channels, increased prices for many goods and services (including fluctuating fuel costs), labor shortages, delayed or reduced spending on IT products, and significant volatility and disruption of financial markets, as well as other conditions arising from international conflicts, such as the ongoing conflict between Russia and Ukraine, geopolitical tensions involving China, and the conflict in Israel and Gaza, uncertainty around the outcome of political elections, and the emergence of pandemics and epidemics.
For example, our business and results of operations could be affected by global macroeconomic trends and events such as inflationary pressure, fluctuations in foreign currency exchange rates, interest rate increases and declines in consumer confidence, widespread disruptions of supply chains and freight and shipping channels, increased prices for many goods and services (including fluctuating fuel costs), labor shortages, delayed or reduced spending on IT products, and significant volatility and disruption of financial markets, as well as other conditions arising from international conflicts, such as the ongoing conflict between Russia and Ukraine, geopolitical tensions involving China, and the conflict in the Middle East, the outcome of political elections, new monetary, fiscal, and trade policies (including tariff policies and import and export restrictions), and the emergence of public health crises.
We have generated significant operating losses from our operations, as reflected in our accumulated deficit of $1,455.1 million as of February 3, 2024.
We have generated significant operating losses from our operations, as reflected in our accumulated deficit of $1,610.0 million as of February 1, 2025.
Cash provided by financing activities was $14.2 million for the fiscal year ended January 28, 2023, which primarily consisted of $18.0 million of proceeds from employee stock purchases under the 2021 ESPP and exercises of stock options, partially offset by $2.5 million in payments of offering costs and $1.3 million in payments of principal on finance leases.
Cash provided by financing activities was $21.0 million for the fiscal year ended February 3, 2024, which primarily consisted of $23.2 million of proceeds from employee stock purchases under the 2021 ESPP and exercises of stock options, partially offset by $2.2 million in payments of principal on finance leases.
The non-cash charges were primarily comprised of stock-based compensation expense of $177.5 million, depreciation and amortization of $11.8 million, bad debt expense of $6.6 million, and lease modification, impairment, and related charges of $1.1 million, partially offset by net accretion of discounts on marketable debt securities of $4.4 million.
The non-cash charges were primarily comprised of stock-based compensation expense of $277.9 million, depreciation and amortization of $20.6 million, and lease modification, impairment, and related charges of $3.5 million, partially offset by net accretion of discounts on marketable debt securities of $15.3 million.
Operating Expenses Research and Development Research and development expenses consist primarily of employee-related costs, including salaries, employee benefits and stock-based compensation, depreciation and other expenses related to prototyping IoT devices, product initiatives, software subscriptions, hosting used in research and development, and allocated overhead costs.
Operating Expenses Research and Development Research and development expenses consist primarily of employee-related costs, including salaries, employee benefits and stock-based compensation, depreciation and other expenses related to prototyping IoT devices, product initiatives, software subscriptions, hosting and cellular-related costs used in research and development, and costs associated with office facilities, IT-related expenses, and depreciation and amortization of property and equipment.
Lease Modification, Impairment, and Related Charges Lease modification, impairment, and related charges are summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % Lease modification, impairment, and related charges $ 4,762 $ 1,056 $ 3,706 351 % Lease modification, impairment, and related charges increased by $3.7 million, or 351%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023.
Lease Modification, Impairment, and Related Charges Lease modification, impairment, and related charges are summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % Lease modification, impairment, and related charges $ 4,028 $ 4,762 $ (734) (15 %) Lease modification, impairment, and related charges decreased by $0.7 million, or 15%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024.
Cash Flows The following table shows a summary of our cash flows for the periods presented (in thousands): Fiscal Year Ended February 3, 2024 January 28, 2023 Net cash used in operating activities $ (11,815) $ (103,021) Net cash used in investing activities $ (78,687) $ (631,848) Net cash provided by financing activities $ 20,997 $ 14,212 Operating Activities Our largest source of operating cash is payments received from our customers.
Cash Flows The following table shows a summary of our cash flows for the periods presented (in thousands): Fiscal Year Ended February 1, 2025 February 3, 2024 Net cash provided by (used in) operating activities $ 131,659 $ (11,815) Net cash used in investing activities $ (66,621) $ (78,687) Net cash provided by financing activities $ 27,101 $ 20,997 Operating Activities Our largest source of operating cash is payments received from our customers.
As a result, we expect our sales and marketing expenses to increase in absolute dollars for the foreseeable future. Our sales and marketing expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
We expect our general and administrative expenses to continue to increase in absolute dollars for the foreseeable future to support our growth. Our general and administrative expenses have fluctuated in the past and may in the future fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
Research and Development Research and development expense is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % Research and development $ 258,581 $ 187,405 $ 71,176 38 % Percentage of revenue 28 % 29 % Research and development expense increased by $71.2 million, or 38%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023, primarily due to a $61.1 million increase in employee-related costs, which included a $34.1 million increase in salaries and benefits and related employer taxes and a $27.0 million increase in stock-based compensation expense, primarily due to increased headcount to support our research and development organization.
Research and Development Research and development expense is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % Research and development $ 299,716 $ 258,581 $ 41,135 16 % Percentage of revenue 24 % 28 % Research and development expense increased by $41.1 million, or 16%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024, primarily due to a $31.0 million increase in employee-related costs, which included a $20.5 million increase in salaries and benefits and related employer taxes and a $10.5 million increase in stock-based compensation expense, primarily due to increased headcount to support our research and development organization.
Our Customers As our business has scaled, we have increasingly focused our sales efforts on larger customers. As of February 3, 2024, we had more than 16,000 customers, each representing $10,000 or more in annual recurring revenue (“ARR”), or Core Customers 5 , and approximately 92% of our ARR came from Core Customers.
Our Customers As our business has scaled, we have increasingly focused our sales efforts on larger customers. As of February 1, 2025, we had more than 20,000 customers, each representing $10,000 or more in ARR, or Core Customers, and approximately 93% of our ARR came from Core Customers.
The increase in sales and marketing expense was also due to an extra week in our fiscal year 2024. 72 Table of Contents General and Administrative General and administrative expense is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % General and administrative $ 195,043 $ 170,785 $ 24,258 14 % Percentage of revenue 21 % 26 % General and administrative expense increased by $24.3 million, or 14%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023, primarily due to a $36.0 million increase in employee-related costs, which included a $23.8 million increase in salaries and benefits and related employer taxes and a $12.2 million increase in stock-based compensation expense, primarily due to increased headcount to support the growth of our finance, accounting, human resources, and legal functions.
The increase in sales and marketing expense was partially offset by an extra week in our fiscal year 2024. 73 Table of Contents General and Administrative General and administrative expense is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % General and administrative $ 234,609 $ 195,043 $ 39,566 20 % Percentage of revenue 19 % 21 % General and administrative expense increased by $39.6 million, or 20%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024, primarily due to a $28.0 million increase in employee-related costs, which included a $16.5 million increase in stock-based compensation expense and a $11.6 million increase in salaries and benefits and related employer taxes, primarily due to increased headcount to support the growth of our finance, accounting, human resources, and legal functions.
We were founded in 2015 and have achieved significant growth since our inception. For the fiscal years ended February 3, 2024 and January 28, 2023, our revenue was $937.4 million and $652.5 million, respectively, representing year-over-year growth of 44% or year-over-year adjusted revenue growth of 41%.
We were founded in 2015 and have achieved significant growth since our inception. For the fiscal years ended February 1, 2025 and February 3, 2024, our revenue was $1,249.2 million and $937.4 million, respectively, representing year-over-year growth of 33%.
As of February 3, 2024, approximately 52% of our ARR came from customers representing over $100,000 in ARR. These customers generally contribute higher revenue, land with multiple products, have higher retention rates, and demonstrate stronger unit economics.
These customers generally contribute higher revenue, land with multiple products, have higher retention rates, and demonstrate stronger unit economics. The number of our customers representing over $100,000 in ARR has increased over time from 1,848 as of February 3, 2024 to 2,506 customers as of February 1, 2025.
Our primary uses of cash from operating activities are for employee-related expenses, sales and marketing expenses, inventory and connected device costs, third-party cloud and cellular infrastructure expenses, and overhead expenses. We have generated negative cash flows from operations in each of the past two fiscal years, and have supplemented working capital through net proceeds from the sale of equity securities.
Our primary uses of cash from operating activities are for employee-related expenses, sales and marketing expenses, inventory and related connected device costs, third-party cloud and cellular infrastructure costs, and overhead expenses. Although we generated positive cash flows from operations in fiscal year 2025, we generated negative cash flows from operations in the preceding two fiscal years.
We may incur additional lease modification, impairment, and related charges in subsequent periods. Legal Settlement Legal settlement expenses consist of charges related to significant legal settlements. We may incur additional legal settlement expenses in subsequent periods.
Lease Modification, Impairment, and Related Charges Lease modification, impairment, and related charges consist of impairment charges related to the sublease and abandonment of facilities. We may incur additional lease modification, impairment, and related charges in subsequent periods. Legal Settlement Legal settlement expenses consist of charges incurred to resolve legal proceedings. We may incur additional legal settlement expenses in subsequent periods.
We have increased our headcount from 2,266 employees as of the last business day of the fiscal year ended January 28, 2023 to 2,895 employees as of the last business day of the fiscal year ended February 3, 2024.
We have increased our headcount from 2,895 employees as of the last business day of the fiscal year ended February 3, 2024 to more than 3,500 full-time employees as of the last business day of the fiscal year ended February 1, 2025.
Our general and administrative expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
Our research and development expenses have fluctuated in the past and may in the future fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
In the first quarter of fiscal year 2023, we executed a sublease for certain office space that resulted in a $1.1 million impairment to the related ROU asset, which we recognized in lease modification, impairment, and related charges for the fiscal year ended January 28, 2023.
In the third quarter of fiscal year 2025, we executed a sublease for certain office space that resulted in a $3.6 million impairment to the related right-of-use (“ROU”) asset and fixed assets, which we recognized in lease modification, impairment, and related charges for the fiscal year ended February 1, 2025.
Sales and Marketing Sales and marketing expense is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % Sales and marketing $ 486,649 $ 370,098 $ 116,551 31 % Percentage of revenue 52 % 57 % Sales and marketing expense increased by $116.6 million, or 31%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023, primarily due to a $74.3 million increase in employee-related costs, which included a $56.6 million increase in salaries and benefits and related employer taxes and a $17.7 million increase in stock-based compensation expense, primarily due to increased headcount to support our sales organization.
Sales and Marketing Sales and marketing expense is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % Sales and marketing $ 601,648 $ 486,649 $ 114,999 24 % Percentage of revenue 48 % 52 % Sales and marketing expense increased by $115.0 million, or 24%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024, primarily due to a $88.2 million increase in employee-related costs, which included a $69.4 million increase in salaries and benefits and related employer taxes, a $13.7 million increase in stock-based compensation expense, and a $5.1 million increase in sales commissions, primarily due to increased headcount to support our sales organization.
Determining whether the subscriptions to our Connected Operations Cloud and the connected device access points are considered distinct performance obligations that should be accounted for separately or as a combined performance obligation requires significant judgment.
Our Connected Operations Platform and the related connected device access points are highly interdependent and interrelated, and represent a combined performance obligation, which is recognized over the related subscription period. 80 Table of Contents Determining whether the subscriptions to our Connected Operations Platform and the connected device access points are considered distinct performance obligations that should be accounted for separately or as a combined performance obligation requires significant judgment.
We expect our research and development expenses to generally increase in absolute dollars for the foreseeable future as we continue to invest in research and development efforts to enhance our Connected Operations Cloud. Our research and development expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
We expect our research and development expenses to generally increase in absolute dollars for the foreseeable future as we continue to invest in research and development efforts to enhance our Connected Operations Platform.
Results of Operations Comparison of the Fiscal Years Ended February 3, 2024 and January 28, 2023 Revenue Our total revenue is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % Revenue $ 937,385 $ 652,545 $ 284,840 44 % Revenue increased by $284.8 million, or 44%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023, primarily due to an increase in customer count and increased purchases of our subscription offerings, including subscriptions to additional Applications, by existing customers, as well as due to an extra week in our fiscal year 2024. 71 Table of Contents Cost of Revenue, Gross Profit, and Gross Margin Our cost of revenue, gross profit, and gross margin are summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % Cost of revenue $ 247,032 $ 182,656 $ 64,376 35 % Gross profit $ 690,353 $ 469,889 Gross margin 74 % 72 % Cost of revenue increased by $64.4 million, or 35%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023, primarily due to $32.4 million of increased amortization of deferred IoT device costs, $14.8 million of increased employee-related costs, which included an $11.2 million increase in salaries and benefits and related employer taxes and a $3.6 million increase in stock-based compensation expense, $8.3 million of increased infrastructure costs associated with our product offerings, $4.0 million of increased warranty costs, and $3.3 million of increased operational costs to support the growth of our subscription offerings.
Results of Operations Comparison of the Fiscal Years Ended February 1, 2025 and February 3, 2024 Revenue Our total revenue is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % Revenue $ 1,249,199 $ 937,385 $ 311,814 33 % Revenue increased by $311.8 million, or 33%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024, primarily due to an increase in customer count and increased purchases by existing customers of our subscription offerings, including subscriptions to additional Applications, partially offset by an extra week in our fiscal year 2024. 72 Table of Contents Cost of Revenue, Gross Profit, and Gross Margin Our cost of revenue, gross profit, and gross margin are summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % Cost of revenue $ 298,321 $ 247,032 $ 51,289 21 % Gross profit $ 950,878 $ 690,353 Gross margin 76 % 74 % Cost of revenue increased by $51.3 million, or 21%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024, primarily due to $22.0 million of increased amortization of IoT device costs, $19.1 million of increased infrastructure costs associated with our product offerings, $7.9 million of increased employee-related costs, which included a $6.5 million increase in salaries and benefits and related employer taxes and a $1.4 million increase in stock-based compensation expense, $3.1 million of increased excess and obsolete inventory charges, and $2.2 million of increased amortization of internally-developed software, partially offset by $4.6 million of decreased warranty costs.
The remaining portion of our revenue not generated from subscriptions to our Connected Operations Cloud is derived from the sale of replacement IoT devices, including gateways, sensors and cameras, related shipping and handling fees, and professional services. Allocation of Overhead Costs Overhead costs that are not substantially dedicated to use by a specific functional group are allocated based on headcount.
The remaining portion of our revenue not generated from subscriptions to our Connected Operations Platform is derived from the sale of replacement IoT devices, including gateways, sensors and cameras, related shipping and handling fees, and professional services.
Our increase in sales and marketing expense was also due to a $16.8 million increase in IT-related charges, software subscriptions, and rent, an $8.9 million increase in expenses relating to lead generation initiatives, an $8.1 million increase in travel-related expenses and expenses relating to our customer visits, conferences, and other events, and a $2.9 million increase in expenses relating to professional services.
The increase in sales and marketing expense was also due to a $10.0 million increase in travel-related costs and expenses relating to our customer visits, conferences, and other events, a $7.1 million increase in IT-related costs and software subscriptions, a $3.1 million increase in expenses relating to campaign marketing and brand awareness, a $2.8 million increase in expenses relating to professional services, and a $1.7 million increase in free trial expense.
Provision for Income Taxes Provision for income taxes is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 3, 2024 January 28, 2023 Amount % Provision for income taxes $ 3,343 $ 3,587 $ (244) (7 %) Effective tax rate (1.2 %) (1.5 %) The provision for income taxes decreased by $0.2 million, or 7%, for the fiscal year ended February 3, 2024 compared to the fiscal year ended January 28, 2023, primarily due to stock-based compensation expense windfalls within our foreign entities.
Provision for Income Taxes Provision for income taxes is summarized as follows (in thousands, except percentages): Fiscal Year Ended Change February 1, 2025 February 3, 2024 Amount % Provision for income taxes $ 4,493 $ 3,343 $ 1,150 34 % Effective tax rate (3.0 %) (1.2 %) The provision for income taxes increased by $1.2 million, or 34%, for the fiscal year ended February 1, 2025 compared to the fiscal year ended February 3, 2024, primarily due to higher taxes related to our foreign jurisdictions.
Our ARR has grown in each of the past two fiscal years, reflecting growth in new customers as well as expanded sales to existing customers. Number of Customers Over $100,000 in ARR We focus on customers representing over $100,000 in ARR, as this key business metric is indicative of our penetration with larger customers.
Number of Customers Over $100,000 in ARR We focus on customers representing over $100,000 in ARR, as this key business metric is indicative of our penetration with larger customers.
Cash used in investing activities was $631.8 million for the fiscal year ended January 28, 2023, which primarily consisted of $685.6 million of purchases of investments and $33.2 million of capital expenditures for additional office facilities, partially offset by $86.6 million of proceeds from maturities of investments. 78 Table of Contents Financing Activities Cash provided by financing activities was $21.0 million for the fiscal year ended February 3, 2024, which primarily consisted of $23.2 million of proceeds from employee stock purchases under the 2021 Employee Stock Purchase Plan (the “2021 ESPP”) and exercises of stock options, partially offset by $2.2 million in payments of principal on finance leases.
Financing Activities Cash provided by financing activities was $27.1 million for the fiscal year ended February 1, 2025, which primarily consisted of $28.8 million of proceeds from employee stock purchases under the 2021 Employee Stock Purchase Plan (the “2021 ESPP”) and exercises of stock options, partially offset by $1.7 million in payments of principal on finance leases.
Our gross margin increased to 74% for the fiscal year ended February 3, 2024 compared to 72% for the fiscal year ended January 28, 2023, mainly due to operational efficiencies in infrastructure costs.
Our gross margin increased to 76% for the fiscal year ended February 1, 2025 compared to 74% for the fiscal year ended February 3, 2024, mainly due to operational efficiencies in IoT device costs, direct labor costs, and warranty charges.
The increase in general and administrative expense was also due to an extra week in our fiscal year 2024.
The increase in research and development expense was partially offset by an extra week in our fiscal year 2024.
(2) In January 2024, we settled non-recurring lease-related litigation and recognized a charge of $68.7 million for the fiscal year ended February 3, 2024. The settlement consisted of a $60.0 million cash payment and $8.7 million associated with the forgiveness of a previously drawn letter of credit.
(2) In January 2025, we settled in principle a non-recurring litigation and recognized a one-time operating expense charge of $0.9 million for the fiscal year ended February 1, 2025. In January 2024, we settled non-recurring lease-related litigation and recognized a charge of $68.7 million for the fiscal year ended February 3, 2024.
Cash used in operating activities was $103.0 million for the fiscal year ended January 28, 2023. This consisted of a net loss of $247.4 million, adjusted for non-cash charges of $192.4 million, and changes in our operating assets and liabilities of $48.0 million.
Cash provided by operating activities was $131.7 million for the fiscal year ended February 1, 2025. This consisted of a net loss of $154.9 million, adjusted for non-cash charges of $288.5 million, and changes in our operating assets and liabilities of $2.0 million.
Non-GAAP Financial Measures To supplement our consolidated financial statements prepared in accordance with GAAP, we review the following non-GAAP financial measures to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions (in thousands, except percentages): Fiscal Year Ended February 3, 2024 January 28, 2023 January 29, 2022 Adjusted revenue (1) $ 917,651 $ 652,545 $ 428,345 Adjusted revenue growth rate (1) 41 % 52 % 71 % Non-GAAP gross profit $ 703,078 $ 479,355 $ 310,205 Non-GAAP gross margin 75 % 73 % 72 % Non-GAAP income (loss) from operations $ 1,270 $ (76,975) $ (114,078) Non-GAAP operating margin 0 % (12) % (27) % Non-GAAP net income (loss) $ 37,891 $ (64,942) $ (115,254) Net cash used in operating activities $ (11,815) $ (103,021) $ (171,481) Free cash flow $ (22,768) $ (136,261) $ (190,834) Free cash flow margin (2) % (21) % (45) % __________ (1) The fourth quarter of fiscal year 2024 was a 14-week fiscal quarter instead of a typical 13-week fiscal quarter.
Non-GAAP Financial Measures To supplement our consolidated financial statements prepared in accordance with GAAP, we review the following non-GAAP financial measures to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions (in thousands, except percentages): Fiscal Year Ended February 1, 2025 February 3, 2024 January 28, 2023 Non-GAAP gross profit $ 966,227 $ 703,078 $ 479,355 Non-GAAP gross margin 77 % 75 % 73 % Non-GAAP income (loss) from operations $ 113,552 $ 1,270 $ (76,975) Non-GAAP operating margin 9 % 0 % (12 %) Non-GAAP net income (loss) $ 148,618 $ 37,891 $ (64,942) Net cash provided by (used in) operating activities $ 131,659 $ (11,815) $ (103,021) Free cash flow $ 111,482 $ (22,768) $ (136,261) Free cash flow margin 9 % (2 %) (21 %) Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under GAAP.
Investors are encouraged to review the related GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures and to not rely on any single financial measure to evaluate our business.
Investors are encouraged to review the related GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures and to not rely on any single financial measure to evaluate our business. 75 Table of Contents Expenses Excluded from Non-GAAP Performance Financial Measures Stock-based compensation expense-related charges include the amortization of deferred stock-based compensation expense for capitalized software and employer taxes on employee equity transactions.
Regardless of how our customers land, we focus on expanding their usage of Connected Operations Cloud and encourage full-scale rollouts across their geographies and divisions. While our Connected Operations Cloud is accessible to customers of all sizes and we have achieved rapid adoption over time, we are particularly focused on larger customers representing over $100,000 in ARR.
While our Connected Operations Platform is accessible to customers of all sizes and we have achieved rapid adoption over time, we are particularly focused on larger customers representing over $100,000 in ARR. As of February 1, 2025, approximately 55% of our ARR came from customers representing over $100,000 in ARR.
We maintain a full valuation allowance against our U.S. deferred tax assets because we have concluded that it is more likely than not that the deferred tax assets will not be realized.
We maintain a full valuation allowance against our U.S. deferred tax assets because we have concluded that it is more likely than not that the deferred tax assets will not be realized. In December 2021, the Organization for Economic Co-operation and Development introduced a new global minimum corporate tax of 15%, commonly referred to as Pillar Two.
Additionally, our Connected Operations Cloud then utilizes this data to deliver actionable insights that are promised to our customers throughout the term of their subscription to Applications on the Connected Operations Cloud.
Additionally, our Connected Operations Platform then utilizes this data to deliver actionable insights that are promised to our customers throughout the term of their subscription to Applications on the Connected Operations Platform. As a result of the highly interdependent and interrelated nature of the integrated service provided, these arrangements are accounted for as a combined performance obligation to the customer.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could have a material impact on our consolidated financial statements. 80 Table of Contents
If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could have a material impact on our consolidated financial statements. 82 Table of Contents
We do not believe that a hypothetical 10% increase or decrease in the relative value of the U.S. dollar to other currencies during any of the periods presented would have had a material impact on our consolidated financial statements. Inflation Risk We do not believe that inflation has had a material impact on our consolidated financial statements.
We do not believe that a hypothetical 10% increase or decrease in the relative value of the U.S. dollar to other currencies during any of the periods presented would have had a material impact on our consolidated financial statements.
A hypothetical 100 basis point increase or decrease in interest rates would have resulted in a decrease or an increase of $5.3 million in the market value of our cash equivalents, and short-term and long-term investments as of February 3, 2024.
A hypothetical 100 basis point increase or decrease in interest rates would have resulted in a decrease or an increase of $6.3 million in the market value of our cash equivalents, and short-term and long-term investments as of February 1, 2025.
Interest Rate Risk As of February 3, 2024, we had $823.8 million of cash, cash equivalents, and short-term and long-term investments in a variety of marketable debt securities, including U.S. government and agency securities, corporate notes and bonds, and commercial paper. In addition, we had $19.2 million of restricted cash primarily due to outstanding letters of credit.
Interest Rate Risk As of February 1, 2025, we had $977.5 million of cash, cash equivalents, and short-term and long-term investments in a variety of marketable debt securities, including U.S. government and agency securities, corporate notes and bonds, and commercial paper. In addition, we had $18.2 million of restricted cash primarily due to outstanding letters of credit.
As of January 28, 2023, we had $803.0 million of cash, cash equivalents, and short-term and long-term investments, and a hypothetical 100 basis point increase or decrease in interest rates would have resulted in a decrease or an increase of $3.4 million in the market value. Foreign Currency Exchange Risk Our reporting currency is the U.S. dollar.
As of February 3, 2024, we had $823.8 million of cash, cash equivalents, and short-term and long-term investments, and a hypothetical 100 basis point increase or decrease in interest rates would have resulted in a decrease or an increase of $5.3 million in the market value. 81 Table of Contents Foreign Currency Exchange Risk Our reporting currency is the U.S. dollar.
The functional currency of our wholly-owned foreign subsidiaries is the U.S. dollar or the Mexican peso. A substantial majority of our sales are denominated in U.S. dollars, and therefore our revenue is not currently subject to significant foreign currency risk.
The functional currency of our wholly-owned foreign subsidiaries is the U.S. dollar or the Mexican peso. A substantial majority, but not all, of our sales are denominated in U.S. dollars. Our operating expenses are denominated in the currencies of the countries in which our operations are located, which are primarily in the United States and the United Kingdom.
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Our operating expenses are denominated in the currencies of the countries in which our operations are located, which are primarily in the United States and the United Kingdom.
Added
For all international customer contracts denominated in currencies other than the U.S. dollar, certain of our operating metrics, including ARR, are translated from local currency to U.S. dollar based on the currency exchange rate as of the effective date of the contract. Inflation Risk We do not believe that inflation has had a material impact on our consolidated financial statements.

Other IOT 10-K year-over-year comparisons