prospectusd18rn0p25nwr6d.cloudfront.net/cik-0001535379/a729d... · preparing data. in order to...

Filed Pursuant to 424(b)(4)Registration No. 333-220494Registration No. 333-220682

PROSPECTUS13,432,114 Shares

COMMON STOCK______________________

Cloudera, Inc. is offering 3,000,000 shares of its common stock and the selling stockholders identified in the prospectus are offering 10,432,114 shares of common stock. We will not receive any proceeds from the sale of shares by the selling stockholders.

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Our common stock is listed on the New York Stock Exchange under the symbol “CLDR.” On September 27, 2017, the last reported saleprice of our common stock on the New York Stock Exchange was $16.59 per share.

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We are an “emerging growth company” as defined under the federal securities laws. Investing in our common stockinvolves risks. See “ Risk Factors ” beginning on page 14.

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PRICE $16.45 A SHARE______________________

Price to Public

Underwriting Discounts and

Commissions (1) Proceeds to

Cloudera

Proceeds to Selling

StockholdersPer Share $16.45 $0.658 $15.792 $15.792Total $220,958,275 $8,838,331 $47,376,000 $164,743,944_______________(1) See the section titled “Underwriters” for a description of the compensation payable to the underwriters. .

Specified selling stockholders have granted the underwriters the right to purchase up to an additional 2,014,816 shares of common stock at the public offeringprice less underwriting discount.

The Securities and Exchange Commission and state regulators have not approved or disapproved of these securities, or determined if this prospectus is truthful orcomplete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares of common stock to purchasers on or about October 2 , 2017.______________________

MORGAN STANLEY J.P. MORGAN ALLEN & COMPANY LLCBofA MERRILL LYNCH CITIGROUP DEUTSCHE BANK SECURITIES

STIFEL JMP SECURITIES RAYMOND JAMES

September 27 , 2017

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TABLE OF CONTENTS

PageProspectusSummary 1TheOffering 10SummaryConsolidatedFinancialData 12RiskFactors 14SpecialNoteRegardingForward-LookingStatements 42Market,IndustryandOtherData 43UseofProceeds 45MarketPriceofOurCommonStock 46DividendPolicy 47Capitalization 48SelectedConsolidatedFinancialData 50Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations 54Business 83

PageManagement 101ExecutiveCompensation 108CertainRelationshipsandRelated-PartyTransactions 119PrincipalandSellingStockholders 123DescriptionofCapitalStock 126SharesEligibleforFutureSale 132MaterialU.S.FederalIncomeTaxConsiderationsforNon-U.S.HoldersofCommonStock 135Underwriters 140LegalMatters 149Experts 149WhereYouCanFindAdditionalInformation 149IndextoConsolidatedFinancialStatements F-1

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Neitherwe,thesellingstockholders,noranyoftheunderwritershaveauthorizedanyonetoprovideyouwithadditionalinformationorinformationthatisdifferentfromortomakeanyrepresentationsotherthanthosecontainedinthisprospectusorinanyfree‑writingprospectuspreparedbyoronbehalfofustowhichwemayhavereferredyouinconnectionwiththisoffering.We,thesellingstockholdersandtheunderwriterstakenoresponsibilityfor,andcanprovidenoassurancesastothereliabilityof,anyotherinformationthatothersmaygiveyou.Weandthesellingstockholdersareofferingtosell,andseekingofferstobuy,ourcommonstockonlyinjurisdictionswhereoffersandsalesarepermitted.Theinformationcontainedinthisprospectusisaccurateonlyasofthedateofthisprospectus,regardlessofthetimeofdeliveryofthisprospectusorofanysaleofourcommonstock.Ourbusiness,financialcondition,resultsofoperationsandfuturegrowthprospectsmayhavechangedsincethatdate.

Unlessthecontextrequiresotherwise,thewords“we,”“us,”“our,”the“Company”and“Cloudera”refertoCloudera,Inc.anditssubsidiariestakenasawhole.Forpurposesofthisprospectus,unlessthecontextotherwiserequires,theterm“stockholders”shallrefertotheholdersofourcommonstock.

ForinvestorsoutsidetheUnitedStates,neitherwe,thesellingstockholders,noranyoftheunderwritershavedoneanythingthatwouldpermitthisofferingorpossessionordistributionofthisprospectusinanyjurisdictionwhereactionforthatpurposeisrequired,otherthanintheUnitedStates.PersonswhocomeintopossessionofthisprospectusinjurisdictionsoutsidetheUnitedStatesarerequiredtoinformthemselvesaboutandtoobserveanyrestrictionsastothisofferingandthedistributionofthisprospectusandanysuchfree‑writingprospectusoutsidetheUnitedStates.

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PROSPECTUS SUMMARY

This summary highlights information contained in greater detail elsewhere in this prospectus. This summary is not complete and does notcontain all of the information you should consider in making your investment decision. You should read the entire prospectus carefully beforemaking an investment in our common stock. You should carefully consider, among other things, our consolidated financial statements andrelated notes and the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results ofOperations” included elsewhere in this prospectus.

CLOUDERA, INC.

Overview

Clouderaempowersorganizationstobecomedata‑drivenenterprisesinthenewlyhyperconnectedworld.Wehavedevelopedthemodernplatformformachinelearningandanalytics,optimizedforthecloud.Wehaveachievedthispositionthroughextensivecollaborationwiththeglobalopensourcecommunity,continuousinnovationindatamanagementtechnologiesandbyleveragingthelatestadvancesininfrastructureincludingthepubliccloudfor“bigdata”applications.Ourpioneeringhybridopensourcesoftware(HOSS)modelincorporatesthebestofopensourcewithourrobustproprietarysoftwaretoformanenterprise‑gradeplatform.Thisplatformdeliversanintegratedsuiteofcapabilitiesfordatamanagement,machinelearningandadvancedanalytics,affordingcustomersanagile,scalableandcosteffectivesolutionfortransformingtheirbusinesses.Ourplatformenablesorganizationstousevastamountsofdatafromavarietyofsources,includingtheInternetofThings(IoT),tobetterserveandmarkettotheircustomers,designconnectedproductsandservicesandreduceriskthroughgreaterinsightfromdata.Avibrantecosystemhasdevelopedaroundourplatform,andagrowingrangeofapplicationsisbeingbuiltonit.Webelievethatoursolutionisthemostwidelyadoptedbigdataplatform.

Theworldisrapidlybecominginterconnectedthroughmobile,social,internetandsensoractivity.InternationalDataCorporation(IDC)estimatesthatby2020therewillbe30billioninternet‑connectedandmobiledevices.Additionally,thequantityofinformationproducedperyearisexpectedtogrow,withIDCestimatingthatapproximately440timesmoreinformationwillbecreatedin2020thanin2005.Developershavecreateddata‑intensiveapplicationstotakeadvantageofallofthisinformation.Traditionaldatamanagementtechnologiescannottechnologicallyoreconomicallycapturethisdataorsupporttheseapplications.Enterprisesarechallengedtomanageanduserapidlygrowingquantitiesofdataofnewandvaryingtypes.Theyarealsooperatinginincreasinglycompetitiveanddemandingregulatoryenvironments.AccordingtostudiesquotedintheHarvardBusinessReview,lessthanhalfofanorganization’sstructureddataisactivelyusedinmakingdecisions,lessthan1%ofitsunstructureddataisanalyzedorusedatall,morethan70%ofemployeeshaveaccesstodatatheyshouldnotand80%ofanalysts’timeisspentsimplydiscoveringandpreparingdata.Inordertoachievetheirbusinessobjectives,enterprisesmustadoptinformation‑centricstrategiesandadata‑drivenapproachtoproblemsolving.Organizationsacrossallindustriesneedtodeveloptheabilitytoactquicklyandcost‑effectivelyonmassiveamountsofdatainanyformfromanysourcetogaininsight,tocompeteeffectivelyandtocomplywithlawsandregulations.Theyneedtomanageallavailabledata,whereveritmayoriginateorreside.Theyneedamodernopendataarchitecturebuiltonthelatestopensourcetechnologiesanddesignedforpubliccloudinfrastructure.

Inresponse,wehavecreatedoursoftwareplatformandpioneeredthehybridopensourcesoftwaremodel.HOSScombinesthebestopensourcesoftwarewithproprietarysoftwaretomeettheexactingrequirementsoflargeenterprises.Byintegratingrobustproprietarysoftwarewithouropensourceplatform,builtontheleadingdatamanagementandanalyticstechnologies,wedeliversubstantiallygreatervaluetocustomersinmanaging,operatingandsecuringtheirdataanddataarchitectures.OurHOSSmodelalsomeaningfullydifferentiatesoursolutionsfromthoseofourcompetitors,includingopensource“freeriders”whotakefrom,butdonotcontributeto,theopensourcecommunityatlarge.Thisdifferentiationalsobuildslong‑livedcustomerrelationshipsandgeneratestherevenuetosupportsustainedinnovation.

Ourscale‑outdistributedarchitecturedelivershighperformanceoninexpensiveindustry‑standardhardwareorcloudinfrastructure.Weallowenterprisestooperate,manageandmoveworkloadsacrossmultiplearchitectures,mixingon‑premisesandcloudenvironments,includingallmajorpubliccloudinfrastructureproviders–AmazonWebServices,MicrosoftAzureandGoogleCloudPlatform–aswellasmanagedserviceproviders(MSPs).Wealso

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enableenterprises’“multi‑cloud”strategies,allowingthemtomoveworkloadsfromthedatacentertothepubliccloud,amongpubliccloudvendors,andbackagain,thusavoidingcloudlock‑in.Inaddition,ourcustomersdeploy,configureandmonitoralltheirworkloadsatscaleacrosstheseenvironmentsfroma“singlepaneofglass.”Thisflexibilityallowscustomerstoconstantlydetermineandimplementthemostcost‑efficientstrategies.AsofJuly31,2017,approximately21%ofourGlobal8000customersrunourplatforminthecloud.

Themarketfornext‑generationdatamanagement,machinelearningandadvancedanalyticsislargeandrapidlygrowingastheworldincreasinglyconnects.IDCestimatesthatthetotalspendonbigdataandbusinessanalyticsrelatedhardware,softwareandserviceswillgrowatan11.9%compoundannualgrowthratetomorethan$210.0billionby2020.Ourplatformcurrentlyaddressesthreenewtransformativemarketswithinbigdataandbusinessanalytics:(i)DynamicDataManagementSystems;(ii)Cognitive/AISystemsandContentAnalyticsSoftware;and(iii)AdvancedandPredictiveAnalyticsSoftware.IDCestimatesthatinaggregatethesemarketswillgrowfrom$10.6billionin2016to$27.7billionin2021atacombinedcompoundannualgrowthrateof21.2%.Beyondthesenewmarkets,ourplatformcurrentlyaddressesandisdisruptingtraditionalmarkets,includingasignificantportionoftheRelationalDatabaseManagementSystemsandNon‑RelationalDatabaseManagementSystemsmarkets.AddingtogetherIDC’sestimatesofthesenewandtraditionalmarkets,webelieveourtotaladdressableopportunityincludingtheseadditionalmarketsisexpectedtoreach$72.7billionby2021.

Weofferoursoftwareplatformonasubscriptionbasisandfocusoursellingeffortsonthelargest8,000corporateenterprisesglobally(Global8000)aswellaslargepublicsectororganizations.Wetargettheseorganizationsbecausetheycaptureandmanagethemajorityoftheworld’sdataandoperatehighlycomplexITenvironments.Theseorganizationsarelikelytorealizethegreatestvaluefromourenterprise‑gradeplatform.Wehaveachievedsignificantgrowthandglobalscaleinarelativelyshortperiodoftime,andasofJuly31,2017,wehaveapproximately562Global8000customers.ForthefiscalyearendedJanuary31,2017andthesixmonthsendedJuly31,2017,revenuefromourGlobal8000represented73%and74%oftotalrevenue,respectively,basedontheGlobal8000constituentsasofMay1,2017.Forfiscal2017andthesixmonthsendedJuly31,2017,revenuefromourpublicsectorcustomers(includinglargepublicsectorcustomers)represented10%and9%oftotalrevenue,respectively.Ourcustomerscontinuetoexpandtheirusageofourplatform.Thenetexpansionrateforoursubscriptionrevenuewas140%asofJuly31,2017.Agrowing,vibrantecosystemhasdevelopedaroundourplatform,andmanythird‑partydevelopershaveprimarilystandardizedonit,buildingmorethan100industry-specificusecases,orapplications,usingourproprietarytechnology.WerefertotheseasPartnerSolutions.Aspartofthisecosystem,wehavedevelopedastrategicpartnershipwithIntelCorporation,orIntel,tooptimizeoursoftwareforusewithIntelprocessorsandarchitecture.Asaresultofourjointdedicationtothispartnership,ourplatformachievesdifferentiatedperformanceonIntelarchitecturetoday,andisexpectedtoachievedifferentiatedperformanceonfutureIntelplatformtechnologies.Wewillfurtherexpandourcustomeropportunitythroughthecontinuedgrowthinusecasesandpackagedsolutions,theexpansionofourpartnerecosystemandtheproliferationofskills,drivenbyeaseofuseandacceleratingadoptionofthecloud.See“Market,IndustryandOtherData”forhowwedefineGlobal8000,largepublicsectororganizationsandcalculateournetexpansionrate.

ForourfiscalyearsendedJanuary31,2016andJanuary31,2017,ourrevenuewas$166.0millionand$261.0million,respectively,representingyear‑over‑yeargrowthinrevenueof57%forourmostrecentfiscalyear.Overthesameperiod,operatingcashoutflowsincreasedfrom$90.5millionto$116.6millionwhileournetlosseswere$203.1millionand$187.3million,respectively,whichincludes$63.6millionand$21.7million,respectively,ofstock‑basedcompensationexpense,andanon‑cashchargeof$21.6millioninconnectionwiththedonationofcommonstocktotheClouderaFoundationforfiscal2017.ForthesixmonthsendedJuly31,2016and2017,ourrevenuewas$120.9millionand$169.4millionrespectively,representingperiod‑over‑periodgrowthinrevenueof40%.Overthesameperiod,operatingcashoutflowsdecreasedfrom$52.1millionto$17.9millionwhileournetlosseswere$81.8millionand$286.5million,respectively,whichincludes$11.2millionand$230.5million,respectively,ofstock‑basedcompensationexpense.

Industry Background

Successfulorganizationshavealwayscollectedandanalyzeddata.Theyhaveusedittounderstandtheircustomers,designandbuildtheirproducts,andaddressopportunitiesandmanageriskintheirbusinesses.

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Today,largeorganizationsareawashinvastlymoredatathaneverbefore.Theycollectreal‑timeandstreamingdataoneventsandtransactions,socialandinteractiondataabouttheircustomers,newsandmarketdataaboutthemselvesandtheircompetition,andmuchmore.Theyarealsooperatinginincreasinglycompetitiveanddemandingregulatoryenvironments.Toachievetheirbusinessobjectives,theymustcapture,secure,prepare,analyzeandactonallofthatdataquickly.

Thisfloodofdataoverwhelmsdatamanagementsystemscreatedinearlierdecades.Thosesystemsweredesignedforthedatavolumesandfortheanalyticalproblemsofanearlierday.Theywereneverintendedtohandlethethousand‑foldorgreaterincreaseinvolume,nortoday’scombinationandcomplexityofdataandnewdatatypes.Thosesystemspredatedpowerfulnewanalytictechniquessuchasmachinelearningandnaturallanguageprocessing.

Thefirstorganizationsconfrontedwiththiscombinationofvolume,complexityandanalyticchallengeswereweb‑scaleconsumerinternetcompanieslikeGoogle,FacebookandYahoo.Thosewebpioneerscreatedanewsoftwarearchitectureandacollectionofopensourcesoftwareprojectstosolvetheirdataproblems.Thatsoftwarewassophisticatedandpowerful,butdemandedexceptionaltechnicalandoperationalskillofitsusers.

Today,boardrooms,C‑suitesandline-of-businessleadersacrossallindustriesarefocusedondevelopingtheabilitytousevastamountsofdatafromavarietyofsourcestobetterservecustomers,designproductsandservicesandmanagerisk.Theirorganizationsneedtechnologythatgivesthembetterinsightsthanlegacysystemsallow.Theyneednewsystemstocompeteeffectivelyandtocomplywiththelawsandregulationsthatgovernthem.Theyneedanenterprise‑gradesolutiontomanageandactonallavailabledata,whereveritmayoriginateorreside.Theyneedthepowerandsophisticationoftheweb‑scaleconsumerinternetleaders,packagedforconsumptionbyordinaryenterprises.Enterprisesrequireamoderndatamanagement,machinelearningandanalyticsplatform.

Factors affecting the development of next ‑‑ generation data management, machine learning and advanced analytics

Amodernplatformformachinelearningandanalyticsisvaluablebecausemoredataoftenyieldsbetteranswerstohardquestions.Itenablesenterprisestolookatproblemsatmuchhigherresolution.Itpermitsqueriestoexaminenotjustthelastmonthorquarter,butthelastyearordecadeofcustomerbehavior.Usingpowerfulmachinelearningalgorithms,itcanexaminehistoricaldataandfindpatternsthatmoreaccuratelypredictfuturetrends.Suchaplatformallowsenterprisestoextractmorevaluefromtheirdataandeffectdigitaltransformation.

Themainfactorsdrivingcomplexityandchallengesinextractingvaluefromdataare:

• The rise of the interconnected world and the Internet of Things (IoT) ,whichiscontributingtoanincreasinglyconnectedworldandacceleratingdatagenerationasnewtypesofsensorscontinuetoproliferateandarealmostalwaysconnectedtoanetwork;

• The explosion of new data ,asorganizationsareundergoingdigitaltransformationandaredigitalizinganincreasingnumberofbusinessactivitiestoimproveandtransformoperations,functionsandprocesses,producingdataatanunprecedentedscale;

• The proliferation of machine learning and artificial intelligence ,asorganizationsrealizethevaluethatpredictiveandadvancedalgorithmscanprovideinadiversearrayofapplications;and

• The modernization of enterprise infrastructure ,asorganizationsseektotakeadvantageofthelatesttechnologicaldevelopments.Inparticular,therearetwocoretrendsthatlargeenterprisesareembracingtoday:

– Opensourcesoftwareisplayinganincreasinglycentralroleinenterprises’technologyarchitecturesasenterprisesvaluetherapidityofinnovation,agilitystemmingfromanopenecosystemandavoidanceofvendorlock‑in;and

– Publiccloudinfrastructureisthefastestgrowingtypeofinfrastructuretodaywithorganizationsenticedbytheelasticityandflexibilityitoffers.

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Requirements of the Modern Data Management and Analytics Platform

Organizationsneedamoderndataplatformwith:

• The ability to deploy on-premises or in the public cloud – or both. Manyenterpriseshavedataon‑premisesforlong‑livedworkloadsandrelyonpubliccloudinfrastructurefortransientworkloads.Asaresult,enterprisesrequireasolutionthatprovidestheflexibilitytostoreandanalyzetheirdatainamixedinfrastructureenvironment.Inaddition,enterprisesrequiretheabilitytorunnativelyondifferentpubliccloudplatforms,ormulti‑cloudcapability,sothattheycanchooseamongcompetingpubliccloudplatformsandmoveworkloadsamongthemtoavoidcloudlock‑in.

• Access to the latest open source technologies. Collaboratingacrossbordersandcompanylines,theglobalopensourcesoftwarecommunityinnovatesquickly.Thisinnovationcanleadtocompetingsoftwareprojects,whichcreatescomplexityandriskforenterprisesthatsimplywanttousethebestandmostappropriateopensourcesoftware.Enterprisesneedatrustedpartnertoplayanactiveroleinthecommunity,contributingsignificantlytoopensourcedevelopmentandcontinuouslycuratingthevariousprojectstocreateahighlyintegrated,secureandhigh‑performanceplatform.

• Support for machine learning. Distributedsystemstogetherwithlargeamountsofdataallowenterprisestousemachinelearningtounderstandthepastandtopredictthefuture.Toperformmachinelearning,adataplatformmustsupportflexibleschemaandmultipledatasciencelanguages.Itmustalsosupportanewclassofanalyticalgorithmsasmachinelearningusessophisticatedalgorithmstoexaminedataandtoextractpatterns.Enterprisesrequireamoderndatamanagementandanalyticsplatformthatpowersthealgorithmstoapplymachinelearningtorealbusinessproblemsandrealbusinessdata.

• Enterprise-grade performance, features and functionality. Enterprisesrequireaplatformsuitedtooperatinginhighlycomplextechnology,businessandregulatoryenvironments,including:

– Scalability and performance. Legacydatamanagementsystemsdonotmeettheperformancedemandsofmoderndataapplications.Thesesystemsdependonasingleorlimitednumberofexpensive,centralizedcomputerstohandlestorageandprocessing.HugequantitiesofdataaccessedbymanyusersrunningacombinationofSQLqueries,textsearchesandmachinelearningtechnologiescansimplyoverwhelmlegacysystems.Themoderndataplatformrequiresascale‑outarchitecture–whichcombinesmanysmall,inexpensivecomputersandpoolstheirstorageandprocessingpower–tomeetperformancedemands.

– Operate and manage resources across environments at scale. Asdataandprocessingneedsgrow,enterprisesrequiretechnologythatoffersvisibilityacrosssystemsandworkloadswithoutregardtowhetherthoseassetsaredeployedon‑premisesorinthecloud.Asenterprisesystemsscale,centralizedmonitoringandmanagementinanyinfrastructureenvironmentbecomescriticaltodataarchitectureoperations,aswellastoregulatoryandpolicycompliance.

– Data security and governance. Dataisstrategic,andenterprisesareretainingmoreofitforlonger–evenpermanently.Alargeconcentrationofdatacreatesuniqueandsignificantsecurityconcerns.Businesspolicy,legalandregulatoryregimesimposerulesastowhomayusedata,forwhatpurposesandhowitissafeguarded.Policysetting,enforcementandmonitoringforcompliancepurposesdemanddatagovernancetechnologythatreportsonusage,tracksdatalineageandensuresthatenterprisescanmeetthestrictprivacyandothercontrolsthatapply.Toappropriatelysafeguarddataandcomplywithlegalandregulatoryrequirements,enterprisesmustensureproperauthentication,authorizationandaccessateverylevel.

– Low total cost of ownership. Theamountofdataavailableforanalysishasgrownexponentially,butITbudgetshavenot.Eveniflegacydatamanagementtechnologiescould addressthechallengesof“bigdata,”theywouldbecostprohibitive.Enterprisesrequiretheabilitytomanagetheirdataarchitectureatscaleandtheflexibilitytousetheinfrastructurethatismostcostefficientandappropriateforeachusecase.

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Our Market Opportunity

Themarketfornext‑generationdatamanagement,machinelearningandadvancedanalyticsislargeandrapidlygrowingastheworldincreasinglyconnects.IDCestimatesthatthetotalspendonbigdataandbusinessanalyticsrelatedhardware,softwareandserviceswillgrowatan11.9%compoundannualgrowthratetomorethan$210.0billionby2020.Ourplatformcurrentlyaddressesthreenewtransformativemarketswithinbigdataandbusinessanalytics:(i)DynamicDataManagementSystems;(ii)Cognitive/AISystemsandContentAnalyticsSoftware;and(iii)AdvancedandPredictiveAnalyticsSoftware.Technologieswithinthefirstmarkethelpenterprisescaptureandmanagetheincreasingvolumeandcomplexityofnewdata.Technologieswithinthelattertwomarketshelpenterprisesgenerateinsightsandderivevaluefromtheirdata.IDCestimatesthatinaggregatethesemarketswillgrowfrom$10.6billionin2016to$27.7billionin2021atacombinedcompoundannualgrowthrateof21.2%.

Beyondthesenewmarkets,ourplatformcurrentlyaddressesandisdisruptingtraditionalmarkets,includingasignificantportionoftheRelationalDatabaseManagementSystemsandNon‑RelationalDatabaseManagementSystemsmarkets.Technologieswithinthesemarketsrepresenttraditionalsystemsusedbyenterprisestomanagetheirdata.AddingtogetherIDC’sestimatesofthesenewandtraditionalmarkets,webelieveourtotaladdressableopportunityincludingtheseadditionalmarketsisexpectedtoreach$72.7billionby2021.

Our Solution

Clouderaempowersorganizationstobecomedata‑drivenenterprisesinthenewlyhyperconnectedworld.Wehavedevelopedthemodernplatformformachinelearningandanalytics,optimizedforthecloud.Buildingontheapproachofweb‑scaleconsumerinternetcompanies,wehavecollaboratedwiththeglobalopensourcecommunitytoinnovateanddeliverourcloud‑nativeplatform.Ourscale‑outdistributedarchitecturedelivershighperformanceoninexpensive,industry‑standardhardwareorcloudinfrastructure.Weallowenterprisestooperate,manageandmoveworkloadsacrossmultiplearchitectures,mixingon‑premisesandcloudenvironments,includingallmajorpubliccloudinfrastructureproviders.Webelievethatoursolutionisthemostwidelyadoptedbigdataplatform,withagrowingrangeofapplicationsbeingbuiltonit.

Wehavepioneeredthehybridopensourcesoftwaredevelopmentmodel,orHOSS.Ourmodelisbasedonactiveparticipationandleadershipintheopensourcedatamanagementecosystemandsoftwaredevelopmentprocess,andutilizationoftheverybestopensourcetechnologies.Asauthorsandparticipants,wecontributenewprojectsandenhanceexistingprojects.Wealsoidentifythebestprojectsthataregrowinginpopularityamongdevelopersandinadoptionbyenterprises.Thisinvolvementhelpsusrecognizeandchampionemergingstandards,aswedidwhenweledthemarketbyembracingSparkasacomplementtotheoriginalMapReducedataprocessingengine.

Todelivertheagilityandinnovationofopensourcesoftwaretoourcustomers,ourplatformintegrates26distinctopensourceprojects,18ofwhichwerecreatedbyourengineers.Wecombinethosecuratedopensourceprojectswithourrobustproprietarysoftwaretoformanenterprise‑gradeplatform.Weprovideafullandintegratedsuiteofdatamanagement,machinelearningandadvancedanalyticcapabilities,affordingenterprisesasingleplatformthatisagile,scalableandcosteffectivefortransformingtheirbusinesses.

Webelieveourapproachhasaprofoundimpactbothonourcustomersandontheopensourcecommunity.OurHOSSmodeldeliverssubstantiallygreatervaluetocustomersinmanaging,operatingandsecuringtheirdataanddataarchitectures.Inaddition,ourrobustproprietarysoftwaremeaningfullydifferentiatesoursolutionsfromthoseofourcompetitors,includingopensource“freeriders”whotakefrom,butdonotcontributeto,theopensourcecommunityatlarge.Thisdifferentiationdrivestherevenuetosustaininvestmentinfurtherinnovationintheopensourcedatamanagementecosystemtoaddressabroadeningsetofenterprisedataneeds.

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Key Benefits and Differentiators

Thesearethekeybenefitsanddifferentiatorsofoursolution:

• Deployable on-premises or in the public cloud – or both. Withouragnosticapproachtoinfrastructure,enterprisesstoreandanalyzetheirdataintheenvironmentthatbestmeetstheirperformanceandefficiencygoals.Oursolutionallowsenterprisestomanagebothlong‑livedandtransientworkloadsacrossenvironments,mixingon‑premisesandpubliccloudinfrastructure,includingallmajorpubliccloudvendors–AmazonWebServices,MicrosoftAzureandGoogleCloudPlatform.Weenableenterprises’multi‑cloudstrategies,allowingthemtomoveworkloadsfromthedatacentertothepubliccloud,amongpubliccloudvendors,andbackagain.Customersmaintainandcontrolaccesstotheirdata,andtheyarebetterabletoobtainattractivetermsandavoidcloudvendorlock‑in.

• Leverages the latest open source innovation . Ourplatformintegratesthelatestinnovationsinopensourcedatamanagementtechnology.Inadditiontoourcontributionstonewprojectinnovationandexistingprojectenhancement,weareabletoleveragethemostsignificantinnovationsofthebroaderglobalcommunity.Forexample,wewerethefirstdataplatformvendortoincorporateSpark,integratingitintoourplatformin2013,enhancingbatchprocessingandenablingreal‑time,streamingandmachinelearningworkloads.ThiscurationandintegrationisacontinuouscommitmentasdemonstratedbyouradoptionofprojectssuchasSolr,Kafka,ImpalaandKudu.Asaresult,weservecustomersbetterandcapitalizeasabusinessonthelatestopensourcetechnologiestodeliverahighlyintegrated,secureandhigh‑performanceplatform.

• Enables machine learning. Ourplatformisuniquelydesignedtoenabletherapidlygrowingdatasciencecommunityandmachinelearningapplications.ThroughourintegrationofSparkandpopulardatasciencelanguageslikePythonandR,ourplatformsupportsbatch,real‑timeandadvancedanalytics.Weprovidethecapabilitiestoreliablyrunmassivelyiterativealgorithms,includingmachinelearningalgorithms,overlargevolumesofdata,tosupportadiverserangeofrelationalandnon‑relationalschemasandtoexpressanalyticworkloadsinmultipledevelopmentanddatasciencelanguages.Thesecapabilitiesallowenterprisestoidentifytrendsinhistoricaldata,torecognizeeventsincurrentorstreamingdataandtopredicteventsinthefuture,continuouslyimprovingwithexperience.

• Delivers enterprise-grade performance, features and functionality. Ourplatformmeetstheexactingrequirementsoflargeenterpriseson-premisesandinthepubliccloud,including:

– Scalability and high performance. Ourdistributedarchitectureallowsourcustomerstoeasilyandinexpensivelyincreasecapacitytomeetthespeedandthroughputdemandsofenterpriseapplications.Combiningmanysmall,inexpensivecomputersandpoolingtheirstorageandprocessingpowerinoneormore“clusters,”ourplatformcandelivertentimesorgreaterperformanceimprovementsoverlegacysystemsatlowercost.Asdatavolumesorperformancerequirementsincrease,addingmorecapacityorcomputingpowerisassimpleasaddingadditionalcomputerstothecluster.Capacityandperformanceexpandlinearlywithclustersize.Withjustoneinstallationofourplatform,acustomercanscaletohundredsofpetabytesofdataundermanagement.

– Integrated management at scale and across environments. Ourcustomerscandeploy,configureandmonitoralltheirclustersandworkloadsatscalefromacentralizedinterfaceacrossanymixofpubliccloudoron‑premisesenvironments.Weofferconfigurablemonitoringandreportingandintuitive,robusttroubleshootingtoprovidecomprehensivemanagementoflarge,growingdatasetsandconcurrentusecases.

– Data security and governance. Ourplatformusesproprietaryauthentication,networkisolation,user‑androle‑basedpermissions,accesslogging,auditing,lineageandencryptionincludingsophisticatedkeymanagementtoprovidecomprehensive,enterprise‑gradedatasecurityacrosstheplatform.Inaddition,ourplatformenablesregulatoryandindustry‑specificcompliancethroughcomprehensivedatagovernance,includingdatadiscovery,datalineage,metadatataggingandpolicyenforcement.

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– Low total cost of ownership. Ourscale‑outarchitecturedelivershighperformanceoninexpensiveindustry‑standardhardwareorcloudinfrastructure.Thisarchitectureallowsorganizationstogaininsightsandrealizevaluefromdataatmuchlowercostthantraditionaldatamanagementplatforms.Ourproprietarycloudautomation,systemsmanagementanddatamanagementcapabilitiesreducethepersonnelrequiredtooperateclustersandworkloadswhilemeetingcompliancestandards.Ourplatformallowscustomerstoselecttheinfrastructureenvironmentthatismostcost‑effectiveandappropriateforeachusecase.Additionally,thenativesecurityfeaturesofourplatformrequirenoadditionalthirdpartylicenses,furtherreducingcoststocustomers.

Recent Developments

Sinceourinitialpublicoffering,wehavecontinuedtoinnovateanddevelopnewtechnologiesandsolutionstoextendourmarketleadershipandenhanceourplatformformachinelearningandanalytics,optimizedforthecloud.Therearefournotableadditionstoourofferings:

• Cloudera Altus. ClouderaAltusisourplatform-as-a-service(PaaS)offering.Altusisacloudservicethatisdesignedtosimplifytheuseofourplatformbyeliminatingtheneedtoinstall,manageandupdateoursoftware.ThefirstserviceonAltusisClouderaAltusDataEngineering,aconvenient,user-drivenserviceforbuildingandmaintainingproductiondataengineeringjobsinAmazonWebServices.WithAltus,Clouderacanaddressanewsetofelasticandtransientworkloadsthatwouldotherwisebeimpracticaltoruninthedatacenter.Overtime,weexpectAltustosupporttherestofourplatformofferingsandadditionalpubliccloudproviders.

• Cloudera Data Science Workbench. ClouderaDataScienceWorkbenchenablesfast,easy,andsecureself-servicedatasciencefortheenterprise.DataScienceWorkbenchisamulti-user,multi-languagedevelopmentenvironmentfordatascienceandmachinelearningapplications.Ithelpsstreamlinethevariousstepsofthemodeldevelopmentlifecycleincludingversioning,dependencymanagement,scheduling,multi-usercollaborationandtrainingmodelsondisparatetypesofcompute.Byenablingcollaborationandsimplifyingapplicationdevelopmentfordatascientists,DataScienceWorkbenchspeedsmachinelearningworkloadsintoproductiononourplatform.

• Fast Forward Labs. OurrecentacquisitionofFastForwardLabs,Inc.enablesustoprovideourcustomerswiththeleadingappliedresearchinmachinelearningandartificialintelligence.ClouderaFastForwardLabssurveysacademicandindustrialresearchfordevelopmentsinthefield,enablingcustomerstobenefitfromthelatestadvancesinappliedmachinelearningandartificialintelligence.Throughoursoftwareandsystemsintegrationpartnersandourownservicesorganization,weareabletodeploythosetechniquesinproductionsolutions,solvingcriticalbusinesschallengesforlargeenterprises.OvertimeweexpectthesecapabilitiestodriveincreasedconsumptionofClouderaDataScienceWorkbenchandourplatform,bothon-premisesandinthepubliccloud.

• Cloudera SDX. ClouderaSDXisamodularsoftwareframeworkthatenablesourcustomerstohavea“shareddataexperience.”Byapplyingacentralized,consistentframeworkforschema,security,governance,dataingestandmore,SDXmakesitpossiblefordozensorhundredsofdifferentcustomerapplicationstorunagainstsharedoroverlappingsetsofdata.SDXmakesmulti-disciplinarydataapplicationseasiertodevelop,lessexpensivetodeployandmoreconsistentlysecure.SDXsupportsmultiplepubliccloud,privatecloudandbaremetalconfigurations.

Our Strategy

Keyelementsofourstrategyinclude:

• leadingcloudinnovationforbigdata,extendingouroriginalcloud‑nativearchitecture;

• growingouraddressablemarketbyexpandingtherangeofapplicationsourplatformcansupport;

• extendingourpositionastheleaderinhybridopensourcesoftware;

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• continuingtorapidlyacquirenewcustomers;

• acceleratingexistingcustomerexpansion;

• leveragingourpartnerecosystem;

• showcasingadata‑drivenbusinesswithourownoperations;and

• cultivatingapassionforsolvingtheworld’sgreatestchallengesthroughdata.

Risks Related to Our Business and Investment in Our Common Stock

Investinginourcommonstockinvolvesahighdegreeofrisk.Youshouldcarefullyconsidertheriskshighlightedinthesectiontitled“RiskFactors”immediatelyfollowingthisprospectussummarybeforemakinganinvestmentdecision.Wemaybeunableformanyreasons,includingthosethatarebeyondourcontrol,toimplementourbusinessstrategysuccessfully.Theserisksinclude:

• wehaveahistoryoflosses,andwemaynotbecomeprofitableinthefuture;

• wehaveashortoperatinghistory,whichmakesitdifficulttopredictourfutureresultsofoperations;

• themarketforourdatamanagementandanalyticsplatformmaydevelopmoreslowlythanweexpect;

• wefaceintensecompetitionandcouldlosemarketsharetoourcompetitors;

• ourcustomersmaynotreneworexpandtheirsubscriptions,ormaydosoonunfavorableterms;

• oursalescyclescanbelongandunpredictable,particularlywithrespecttolargesubscriptions,andoursaleseffortsrequireconsiderabletimeandexpense;

• wedonothaveanadequatehistorywithoursubscriptionorpricingmodelstoaccuratelypredictthelong‑termrateofcustomeradoptionorrenewal,ortheimpactthesewillhaveonourrevenueoroperatingresults;

• ourresultsmayfluctuatesignificantlyfromperiodtoperiod;

• wefacerisksbecausewederivesubstantiallyallofourrevenuefromasinglesoftwareplatform,andwemayfailtosatisfycustomerdemandsorachieveincreasedmarketacceptance;

• wehavebeen,andmayinthefuturebe,subjecttointellectualpropertyrightsclaimsbythirdparties,andwemayfailtoadequatelyprotectconfidentialinformationandourintellectualpropertyrights;and

• ourdirectors,executiveofficersandstockholderswhoowngreaterthan5%ofouroutstandingcommonstock,andtheiraffiliates,whoafterthisofferingwillcollectivelyholdapproximately42.6%ofouroutstandingcommonstock,basedonthenumberofsharesoutstandingasofAugust31,2017,willhavetheabilitytoinfluenceorcontroltheoutcomeofmatterssubmittedtoourstockholdersforapproval.

Ifweareunabletoadequatelyaddresstheseandotherrisksweface,ourbusiness,financialcondition,operatingresultsandprospectsmaybeadverselyaffected.

Corporate History and Information

WewereincorporatedinDelawarein2008,andwehad1,606full‑timeemployeesasofJuly31,2017.Ourprincipalexecutiveofficesarelocatedat395PageMillRoad,PaloAlto,California94306andourtelephonenumberis(650)362‑0488.Ourwebsiteaddressiswww.cloudera.com.Theinformationon,orthatcanbeaccessedthrough,ourwebsitesarenotincorporatedbyreferenceintothisprospectusandshouldnotbeconsideredpartofthisprospectus.

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InMay2014,inconjunctionwithformingourstrategicpartnershipwithIntel,Intelinvestedapproximately$741.8millioninourcapitalstock,includingpurchasingapproximately$370.9millionfromusandanaggregateofapproximately$370.9millionfromsomeofourstockholders.Subsequently,Intelhaspurchasedadditionalsharesofourcapitalstockfromsomeofourstockholdersaswellasfromusinourinitialpublicoffering,bringingIntel’saggregateinvestmentinourcapitalstocktoapproximately$784.5millionasofAugust31,2017.Aftercompletionofthisoffering,Intelwillholdapproximately18.7%ofouroutstandingcommonstockbasedonthenumberofsharesoutstandingasofAugust31,2017.See“Business—IntelStrategicPartnership”and“CertainRelationshipsandRelated‑PartyTransactions.”

Cloudera isaregisteredtrademarkoftheCompany.Cloudera Navigator ,Cloudera Navigator Audit and Lineage, Cloudera NavigatorOptimizer, Cloudera Navigator Encrypt, Cloudera Navigator Key Trustee, Cloudera Essentials, Cloudera Enterprise Data Hub, Cloudera DataScience and Engineering, Cloudera Operational DB, Cloudera Analytics DB, Cloudera Atlus, Cloudera Data Science Workbench, ClouderaManager and Cloudera Director aresomeofourtrademarksusedinthisprospectus.Solelyforconvenience,ourtrademarks,tradenamesandservicemarksreferredtointhisprospectusappearwithoutthe®,™andSMsymbols,butthosereferencesarenotintendedtoindicate,inanyway,thatwewillnotassert,tothefullestextentunderapplicablelaw,ourrightstothesetrademarksandtradenames.

Othertrademarksappearinginthisprospectusarethepropertyoftheirrespectiveholders.Forexample,ApacheAvro,ApacheFlume,ApacheHadoop,ApacheHadoopYARN,ApacheHBase,ApacheHive,ApacheImpala(incubating),ApacheKafka,ApacheKudu,ApachePig,ApacheSentry,ApacheSolr,ApacheSpark,ApacheSpot(incubating)andApacheSqooparetrademarksoftheApacheSoftwareFoundation.AllreferencestoAvro,Flume,Hadoop,HadoopYARN,HBase,Hive,Impala,Kafka,Kudu,Pig,Sentry,Solr,Spark,SpotandSqooparetothecorrespondingApacheproject.

Implications of Being an Emerging Growth Company

Asacompanywithlessthan$1.07billioninrevenueduringourlastcompletedfiscalyear,wequalifyasan“emerginggrowthcompany”asdefinedintheJumpstartOurBusinessStartupsActof2012.Anemerginggrowthcompanymaytakeadvantageofspecifiedreducedreportingrequirementsthatareotherwiseapplicablegenerallytopubliccompanies.Thesereducedreportingrequirementsinclude:

• anexemptionfromcompliancewiththeauditorattestationrequirementontheeffectivenessofourinternalcontroloverfinancialreporting;

• anexemptionfromcompliancewithanyrequirementthatthePublicCompanyAccountingOversightBoardmayadoptregardingasupplementtotheauditor’sreportprovidingadditionalinformationabouttheauditandthefinancialstatements;

• reduceddisclosureaboutourexecutivecompensationarrangements;

• anexemptionfromtherequirementstoobtainanon‑bindingadvisoryvoteonexecutivecompensationorastockholderapprovalofanygoldenparachutearrangements;and

• extendedtransitionperiodsforcomplyingwithneworrevisedaccountingstandards.

Wewillremainan“emerginggrowthcompany”uptothelastdayofthefiscalyearendingafterthefifthanniversaryofourinitialpublicoffering.However,amongotherfactors,ifthemarketvalueofourcommonstockthatisheldbynon‑affiliatesexceeds$700millionasofanyJuly31afterourfirstannualreport,wewouldceasetobean“emerginggrowthcompany”asofthefollowingJanuary31.

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THE OFFERING

Commonstockofferedbyus 3,000,000sharesCommonstockofferedbythesellingstockholders 10,432,114sharesTotalcommonstockoffered 13,432,114sharesOptiontopurchaseadditionalsharesofferedbythesellingstockholdersexercisablefor30daysfromthedateofthisprospectus 2,014,816sharesCommonstocktobeoutstandingafterthisoffering 139,289,042sharesUseofproceeds Weintendtouseournetproceedsfromthisofferingtoraisecapital

toreplacecashwewilluseforfundingtaxwithholdingobligationsweincurreduponthenetsettlementofequityawards,thesettlementandwithholdingofwhichwasconcurrentwiththepricingofthisoffering.Wewillnotreceiveanyproceedsfromthesaleofsharesbythesellingstockholders.See“UseofProceeds.”

Riskfactors See“RiskFactors”beginningonpage14andotherinformation

includedinthisprospectusforadiscussionoffactorsthatyoushouldconsidercarefullybeforedecidingtoinvestinourcommonstock.

NewYorkStockExchangetickersymbol “CLDR”

Thenumberofsharesofcommonstocktobeoutstandingafterthisofferingisbasedon131,250,336sharesofcommonstockoutstandingasofJuly31,2017,andexcludes:

• 22,211,442sharesofourcommonstockissuableupontheexerciseofstockoptionsoutstandingasofJuly31,2017,withaweighted‑averageexercisepriceof$4.73pershare;

• 24,197,948sharesofourcommonstocksubjecttorestrictedstockunits(RSUs)outstandingasofJuly31,2017;

• 1,251,206sharesofourcommonstocksubjecttoRSUsgrantedafterJuly31,2017throughSeptember27,2017;

• 8,100sharesofourcommonstockissuableupontheexerciseofstockoptionsgrantedafterJuly31,2017throughSeptember27,2017withanexercisepriceof$17.32pershare;

• 358,206sharesofourcommonstockissuedinconnectionwithstrategictransactionsafterJuly31,2017throughSeptember27,2017;and

• 32,848,932sharesofourcommonstockreservedforfutureissuanceunderourequitycompensationplans,consistingof:

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– 29,848,932sharesofourcommonstockreservedforfutureissuanceunderour2017EquityIncentivePlan,or2017Plan,asofJuly31,2017(whichnumberofsharesispriortotheRSUsandstockoptionsgrantedafterJuly31,2017);and

– 3,000,000sharesofourcommonstockreservedforfutureissuanceunderour2017ESPP.

Thesharesavailableforissuanceunderour2017Planincludethesharesthatwerepreviouslyreservedforissuanceunderour2008EquityIncentivePlan,orthe2008Plan,onApril27,2017,whenour2017Planbecameeffectiveandwhenweceasedgrantingawardsunderthe2008Plan.Our2017Planand2017ESPPalsoprovideforautomaticannualincreasesinthenumberofsharesreservedthereunder.Seethesectiontitled“ExecutiveCompensation-EmployeeBenefitPlans”foradditionalinformation.The3,080,027shareswithheldtosatisfywithholdingtaxobligationsinconnectionwiththesettlementofRSUsconcurrentlywiththisofferingwillbeavailableforissuanceunderour2017Plan.

Exceptasotherwiseindicated,allinformationinthisprospectusassumes:theissuanceof5,038,706sharesofcommonstocksubjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttothecancellationandforfeitureof3,080,027shareswithheldtosatisfytheassociatedwithholdingtaxobligations;

• noexerciseorcancellationofoutstandingoptionsorvestingofRSUssubsequenttoJuly31,2017;and

• noexercisebytheunderwritersoftheiroptiontopurchaseuptoanadditional2,014,816sharesofourcommonstockfromspecifiedsellingstockholdersinthisoffering.

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SUMMARY CONSOLIDATED FINANCIAL DATA

WehavederivedthesummaryconsolidatedstatementofoperationsdatafortheyearsendedJanuary31,2016and2017andthesummaryconsolidatedbalancesheetdataasofJanuary31,2017fromourauditedconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.WehavederivedthesummaryconsolidatedstatementofoperationsdatafortheyearendedJanuary31,2015fromourauditedconsolidatedfinancialstatementsthatarenotincludedinthisprospectus.WehavederivedthesummaryconsolidatedstatementofoperationsdataforthesixmonthsendedJuly31,2016and2017andthesummaryconsolidatedbalancesheetdataasofJuly31,2017fromourunauditedinterimconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.OurunauditedinterimconsolidatedfinancialstatementshavebeenpreparedinaccordancewithU.S.generallyacceptedaccountingprinciples,orU.S.GAAP,onthesamebasisasourauditedannualconsolidatedfinancialstatementsand,intheopinionofmanagement,reflectalladjustments,consistingonlyofnormal,recurringadjustments,thatarenecessaryforthefairstatementofourconsolidatedfinancialpositionasofJuly31,2017andourconsolidatedresultsofoperationsforthesixmonthsendedJuly31,2016and2017.Youshouldreadthefollowingsummaryconsolidatedfinancialdatainconjunctionwith“Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations”andourconsolidatedfinancialstatementsandrelatednotesincludedelsewhereinthisprospectus.Ourhistoricalresultsarenotnecessarilyindicativeoftheresultstobeexpectedforanyotherperiodinthefuture,andtheresultsforthesixmonthsendedJuly31,2017arenotnecessarilyindicativeoftheresultstobeexpectedforthefullyearoranyotherperiod.

Year EndedJanuary 31, Six Months Ended

July 31,

2015 2016 2017 2016 2017

(in thousands, except per share data)

Consolidated Statements of Operations Data: Revenue: Subscription $ 72,615 $ 119,150 $ 200,252 $ 91,360 $ 138,657

Services 36,503 46,898 60,774 29,581 30,767

Totalrevenue 109,118 166,048 261,026 120,941 169,424Costofrevenue:(1)(2)(4) Subscription 18,314 30,865 38,704 19,057 41,687Services 32,148 44,498 48,284 23,317 50,395

Totalcostofrevenue 50,462 75,363 86,988 42,374 92,082Grossprofit 58,656 90,685 174,038 78,567 77,342Operatingexpenses:(1)(2)(3)(4)

Researchanddevelopment 66,431 99,314 102,309 51,150 138,675

Salesandmarketing 103,736 161,106 203,161 93,044 172,578

Generalandadministrative 25,041 34,902 55,907 16,676 54,114

Totaloperatingexpenses 195,208 295,322 361,377 160,870 365,367

Lossfromoperations (136,552) (204,637) (187,339) (82,303) (288,025)

Interestincome,net 327 2,218 2,756 1,448 2,089

Otherincome(expense),net (490) 386 (547) (15) 839

Netlossbeforebenefitfrom(provisionfor)incometaxes (136,715) (202,033) (185,130) (80,870) (285,097)

Benefitfrom(provisionfor)incometaxes 1,285 (1,110) (2,187) (970) (1,451)

Netloss (135,430) (203,143) (187,317) (81,840) (286,548)Deemeddividendtopreferredstockholders (43,207) — — — —

Netlossattributabletocommonstockholders $ (178,637) $ (203,143) $ (187,317) $ (81,840) $ (286,548)

Netlosspershareattributabletocommonstockholders,basicanddiluted $ (6.53) $ (6.21) $ (5.15) $ (2.27) $ (3.28)

Weighted-averagesharesusedincomputingnetlosspershareattributabletocommonstockholders,basicanddiluted(5) 27,348 32,724 36,406 36,090 87,293

Other Financial Statement Data: Non-GAAPoperatingloss(6) $ (100,431) $ (137,592) $ (140,331) $ (69,232) $ (55,607)

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___________(1) Amountsincludestock‑basedcompensationexpenseasfollows:


July 31,

2015 2016 2017 2016 2017

(in thousands)

Costofrevenue–subscription $ 996 $ 3,363 $ 1,426 $ 708 $ 19,393

Costofrevenue–services 1,376 4,301 1,803 931 24,227




Totalstock-basedcompensationexpense $ 34,066 $ 63,590 $ 21,714 $ 11,241 $ 230,533

(2) Amountsincludeamortizationofacquiredintangibleassetsasfollows:


July 31,

2015 2016 2017 2016 2017

(in thousands)


Salesandmarketing 1,149 1,723 1,723 861 861

Totalamortizationofacquiredintangibleassets $ 2,055 $ 3,455 $ 3,720 $ 1,830 $ 1,885

(3) InJanuary2017,wedonated1,175,063sharesofcommonstocktotheClouderaFoundation.Werecordedanon‑cashchargeof$21.6millionforthefairvalueofthedonatedshares,whichwasrecognizedingeneralandadministrativeexpensefortheyearendedJanuary31,2017.SeeNote12toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforfurtherdiscussion.

(4) OnApril27,2017,theeffectivedateofourinitialpublicoffering,theliquidityevent‑relatedperformanceconditionwasachievedforthemajorityofourRSUsandbecameprobableofbeingachievedfortheremainingRSUs.Werecognizedstock‑basedcompensationexpenseusingtheacceleratedattributionmethodwithacumulativecatch‑upofstock‑basedcompensationexpenseintheamountof$181.5millionduringthesixmonthsendedJuly31,2017,attributabletoservicepriortosucheffectivedate.SeeNote10toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforfurtherdiscussion.

(5) SeeNotes2and14toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforanexplanationofthecalculationsofourbasicanddilutednetlosspershareattributabletocommonstockholders,andtheweighted‑averagenumberofsharesusedinthecomputationofthepershareamounts.

(6) Wedefinenon‑GAAPoperatinglossaslossfromoperationsbeforestock‑basedcompensationexpense,amortizationofacquiredintangibleassetsanddonationofcommonstocktotheClouderaFoundation.Formoreinformationaboutournon‑GAAPoperatinglossandareconciliationofournon‑GAAPoperatinglosstolossfromoperations,themostdirectlycomparablefinancialmeasurecalculatedandpresentedinaccordancewithU.S.generallyacceptedaccountingprinciples(GAAP),seethesectiontitled“SelectedConsolidatedFinancialData—Non‑GAAPFinancialMeasure.”

As of July 31, 2017

Actual As

Adjusted (1)

(in thousands)

Consolidated Balance Sheet Data: Cashandcashequivalents $ 68,936 $ 63,364Marketablesecurities,currentandnoncurrent 406,816 406,816Workingcapital 248,492 242,920Totalassets 649,817 644,245Deferredrevenue,currentandnoncurrent 231,121 231,121Totalstockholders’equity 355,388 349,816___________(1) Reflects(i)thesalebyusof3,000,000sharesofcommonstockinthisofferingatthepublicofferingpriceof$16.45pershare,afterdeductingtheunderwriting

discountsandcommissionsandestimatedofferingexpensespayablebyusandtheapplicationofthenetproceedsofthisofferingasdescribedin“UseofProceeds,”and(ii)theissuanceof5,038,706sharesofcommonstocksubjecttothesettlementofrestrictedstockunits(RSUs),thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttothecancellationandforfeitureof3,080,027shareswithheldtosatisfytheassociatedwithholdingtaxobligations.

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RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the risks described below, as well as the other information in thisprospectus, including our consolidated financial statements and the related notes and “Management’s Discussion and Analysis of Financial Condition and Resultsof Operations,” before deciding whether to invest in our common stock. The occurrence of any of the events or developments described below could materially andadversely affect our business, financial condition, results of operations and growth prospects. In such an event, the market price of our common stock coulddecline, and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently believe are not materialmay also impair our business, financial condition, results of operations and growth prospects .

Risks Related to our Business

We have a history of losses, and we may not become profitable in the future.

Wehaveincurrednetlossessinceourfoundingin2008,includingnetlossesof$135.4million,$203.1million,$187.3millionand286.5millionfortheyearsendedJanuary31,2015,2016and2017andthesixmonthsendedJuly31,2017,respectively,andexpecttocontinuetoincurnetlossesfortheforeseeablefuture.Asaresult,wehadanaccumulateddeficitof$962.5millionatJuly31,2017.Theselossesandaccumulateddeficitreflectthesubstantialinvestmentswemadetoacquirenewcustomers,commercializeourplatform,participateintheopensourcedevelopmentcommunityanddevelopourproprietarysoftwarecomponentsunderourhybridopensourcesoftware(HOSS)model,andcontinuetodevelopourplatform.Furthermore,totheextentwearesuccessfulinincreasingourcustomerbase,wemayalsoincurincreasedlossesbecausecustomeracquisitioncostsandupfrontcostsassociatedwithnewcustomersarehigherinthefirstyearthantheaggregaterevenuewerecognizefromthosenewcustomersinthefirstyear.

Weexpecttocontinuetomakesignificantfutureexpendituresrelatedtothedevelopmentandexpansionofourbusiness,including:

• investmentsinourresearchanddevelopmentteamandinthedevelopmentofnewsolutionsandenhancementsofourplatform,includingcontributionstotheopensourcedatamanagementecosystem;

• investmentsinsalesandmarketing,includingexpandingoursalesforce,increasingourcustomerbase,increasingmarketawarenessofourplatformanddevelopmentofnewtechnologies;

• expandingofouroperationsandinfrastructure,includinginternationally;

• hiringadditionalemployees;and

• incurringcostsassociatedwithgeneraladministration,includinglegal,accountingandotherexpensesrelatedtobeingapubliccompanyuponcompletionofthisoffering.

Asaresultoftheseincreasedexpenses,wewillhavetogenerateandsustainincreasedrevenuetobeprofitableinfutureperiods.Further,infutureperiods,ourrevenuegrowthratecoulddecline,andwemaynotbeabletogeneratesufficientrevenuetooffsethighercostsandachieveorsustainprofitability.Ifwefailtoachieve,sustainorincreaseprofitability,ourbusinessandoperatingresultscouldbeadverselyaffected.

We have a short operating history, which makes it difficult to predict our future results of operations.

Wehaveashortoperatinghistory,whichlimitsourabilitytoforecastourfutureresultsofoperationsandsubjectsustoanumberofuncertainties,includingourabilitytoplanforandanticipatefuturegrowth.Ourhistoricalrevenuegrowthshouldnotbeconsideredindicativeofourfutureperformance.Further,infutureperiods,ourrevenuegrowthcouldsloworourrevenuecoulddeclineforanumberofreasons,includingslowingdemandforoursolutions,increasingcompetition,adecreaseinthegrowthofouroverallmarket,orourfailure,foranyreason,tocontinuetocapitalizeongrowthopportunities.Wehavealsoencounteredandwillencounterrisksanduncertaintiesfrequentlyexperiencedbygrowingcompaniesinrapidlychangingindustries,suchasdeterminingappropriateinvestmentsofourlimitedresources,marketreceptionofourplatformandHOSSmodel,competitionfromother

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companies,attractingandretainingcustomers,hiring,integrating,trainingandretainingskilledpersonnel,developingnewsolutionsandunforeseenexpenses.Ifourassumptionsregardingtheserisksanduncertainties,whichweusetoplanourbusiness,areincorrectorchange,orifwedonotaddresstheseriskssuccessfully,ouroperatingandfinancialresultscouldbeadverselyaffected.

If the market for our data management, machine learning and analytics platform develops more slowly than we expect, our growth may slow or stall, and ouroperating results could be harmed.

Themarketforadatamanagement,machinelearningandanalyticsplatformisrelativelynew,rapidlyevolvingandunproven.Ourfuturesuccesswilldependinlargepartonourabilitytopenetratetheexistingmarketfordatamanagement,machinelearningandanalyticsplatforms,aswellasthecontinuedgrowthandexpansionofthatmarket.Itisdifficulttopredictcustomeradoptionandrenewalsofoursubscriptions,customerdemandforourplatform,thesize,growthrateandexpansionofthismarket,theentryofcompetitiveproductsorthesuccessofexistingcompetitiveproducts.Ourabilitytopenetratetheexistingmarketfordatamanagement,machinelearningandanalyticsplatformsandanyexpansionofthatmarketdependsonanumberoffactors,includingthecost,performanceandperceivedvalueassociatedwithourplatform,aswellaspotentialcustomers’willingnesstoadoptanalternativeapproachtodatacollection,storageandprocessing.Ifweorotherdatamanagementprovidersexperiencesecurityincidents,lossofcustomerdata,disruptionsindeliveryorotherproblems,themarketfordatamanagement,machinelearningandanalyticsplatformsasawhole,includingoursolutions,maybenegativelyaffected.Furthermore,manypotentialcustomershavemadesignificantinvestmentsinlegacydatacollection,storageandprocessingsoftwareandmaybeunwillingtoinvestinnewsolutions.Ifdatamanagement,machinelearningandanalyticsplatformsdonotachievewidespreadadoption,orthereisareductionindemandcausedbyalackofcustomeracceptance,technologicalchallenges,weakeningeconomicconditions,securityorprivacyconcerns,competingtechnologiesandproducts,decreasesincorporatespendingorotherwise,itcouldresultindecreasedrevenueandourbusinesscouldbeadverselyaffected.

We face intense competition and could lose market share to our competitors, which could adversely affect our business, financial condition and results ofoperations.

Themarketfordatamanagement,machinelearningandanalyticsplatformsisintenselycompetitiveandcharacterizedbyrapidchangesintechnology,customerrequirements,industrystandardsandfrequentnewproductintroductionsandimprovements.Weanticipatecontinuedchallengesfromcurrentcompetitors,whichinmanycasesaremoreestablishedandenjoygreaterresourcesthanus,aswellasbynewentrantsintotheindustry.Ifweareunabletoanticipateoreffectivelyreacttothesecompetitivechallenges,ourcompetitivepositioncouldweaken,andwecouldexperienceadeclineinourgrowthrateorrevenuethatcouldadverselyaffectourbusinessandresultsofoperations.

Ourmainsourcesofcurrentandpotentialcompetitionfallintofourcategories:

• legacydatamanagementproductproviderssuchasHP,IBM,OracleandTeradata;

• publiccloudproviderswhoincludeproprietarydatamanagement,machinelearningandanalyticsofferings,suchasAmazonWebServices,GoogleCloudPlatformandMicrosoftAzure;

• strategicandtechnologypartnerswhomayalsoofferourcompetitors’technologyorotherwisepartnerwiththem,includingourstrategicpartnerswhoprovidePartnerSolutions(see“Business—PartnersandStrategicAlliances”)astheymayofferasubstantiallysimilarsolutionbasedonacompetitor’stechnology;and

• opensourcecompanies,includingHortonworksandMapR,aswellasinternalITorganizationsthatprovideopensourceself‑supportfortheirenterprises.

Manyofourexistingcompetitorshave,andsomeofourpotentialcompetitorscouldhave,substantialcompetitiveadvantagessuchas:

• greaternamerecognition,longeroperatinghistoriesandlargercustomerbases;

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• largersalesandmarketingbudgetsandresourcesandthecapacitytoleveragetheirsaleseffortsandmarketingexpendituresacrossabroaderportfolioofproducts;

• broader,deeperorotherwisemoreestablishedrelationshipswithtechnology,channelanddistributionpartnersandcustomers;

• widergeographicpresenceorgreateraccesstolargercustomerbases;

• greaterfocusinspecificgeographies;

• lowerlaborandresearchanddevelopmentcosts;

• largerandmorematureintellectualpropertyportfolios;and

• substantiallygreaterfinancial,technicalandotherresourcestoprovidesupport,tomakeacquisitionsandtodevelopandintroducenewproducts.

Inaddition,someofourlargercompetitorshavesubstantiallybroaderandmorediverseproductandserviceofferingsandmaybeabletoleveragetheirrelationshipswithdistributionpartnersandcustomersbasedonotherproductsorincorporatefunctionalityintoexistingproductstogainbusinessinamannerthatdiscouragesusersfrompurchasingourplatform,includingbysellingatzeroornegativemargins,productbundlingorofferingclosedtechnologyplatformssuchasIBMWatson.Potentialcustomersmayalsoprefertopurchasefromtheirexistingsuppliersratherthananewsupplierregardlessofplatformperformanceorfeatures.Asaresult,evenifthefeaturesofourplatformaresuperior,customersmaynotpurchaseoursolutions.Theselargercompetitorsoftenhavebroaderproductlinesandmarketfocusorgreaterresourcesandmaythereforenotbeassusceptibletoeconomicdownturnsorothersignificantreductionsincapitalspendingbycustomers.Ifweareunabletosufficientlydifferentiateoursolutionsfromtheintegratedorbundledproductsofourcompetitors,suchasbyofferingenhancedfunctionality,performanceorvalue,wemayseeadecreaseindemandforthosesolutions,whichcouldadverselyaffectourbusiness,operatingresultsandfinancialcondition.

Inaddition,newinnovativestart‑upcompanies,andlargercompaniesthataremakingsignificantinvestmentsinresearchanddevelopment,mayintroduceproductsthathavegreaterperformanceorfunctionality,areeasiertoimplementoruse,orincorporatetechnologicaladvancesthatwehavenotyetdevelopedorimplementedormayinventsimilarorsuperiorproductsandtechnologiesthatcompetewithourplatform.Ourcurrentandpotentialcompetitorsmayalsoestablishcooperativerelationshipsamongthemselvesorwiththirdpartiesthatmayfurtherenhancetheirresources.

Someofourcompetitorshavemadeorcouldmakeacquisitionsofbusinessesorenterintopartnershipsthatallowthemtooffermorecompetitiveandcomprehensivesolutions.Asaresultofsucharrangements,ourcurrentorpotentialcompetitorsmaybeabletoacceleratetheadoptionofnewtechnologiesthatbetteraddresscustomerneeds,devotegreaterresourcestobringtheseproductsandservicestomarket,initiateorwithstandsubstantialpricecompetition,ordevelopandexpandtheirproductandserviceofferingsmorequicklythanwedo.Thesecompetitivepressuresinourmarketorourfailuretocompeteeffectivelymayresultinfewerorders,reducedrevenueandgrossmarginsandlossofmarketshare.Inaddition,itispossiblethatindustryconsolidationmayimpactcustomers’perceptionsoftheviabilityofsmallerorevenmid‑sizesoftwarefirmsandconsequentlycustomers’willingnesstopurchasefromsuchfirms.

Wemaynotcompetesuccessfullyagainstourcurrentorpotentialcompetitors.Ifweareunabletocompetesuccessfully,orifcompetingsuccessfullyrequiresustotakecostlyactionsinresponsetotheactionsofourcompetitors,ourbusiness,financialconditionandresultsofoperationscouldbeadverselyaffected.Inaddition,companiescompetingwithusmayhaveanentirelydifferentpricingordistributionmodel.Increasedcompetitioncouldresultinfewercustomerorders,pricereductions,reducedoperatingmarginsandlossofmarketshare.Further,wemayberequiredtomakesubstantialadditionalinvestmentsinresearch,development,marketingandsalesinordertorespondtosuchcompetitivethreats,andwecannotassureyouthatwewillbeabletocompetesuccessfullyinthefuture.

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Because of the characteristics of open source software, there may be fewer technology barriers to entry in the hybrid open source market by new competitorsand it may be relatively easy for new and existing competitors with greater resources than we have to compete with us.

Oneofthecharacteristicsofopensourcesoftwareisthatthegoverninglicensetermsgenerallyallowliberalmodificationsofthecodeanddistributionthereoftoawidegroupofcompaniesand/orindividuals.Asaresult,otherscouldeasilydevelopnewsoftwareproductsbaseduponthoseopensourceprogramsthatcompetewithexistingopensourcesoftwarethatwesupportandincorporateintoourplatform.Suchcompetitionwithuseoftheopensourceprojectsthatweutilizecanmaterializewithoutthesamedegreeofoverheadandleadtimerequiredbyus,particularlyifthecustomersdonotvaluethedifferentiationofourproprietarycomponents.Itispossiblefornewandexistingcompetitorswithgreaterresourcesthanourstodeveloptheirownopensourcesoftwareorhybridproprietaryandopensourcesoftwareofferings,potentiallyreducingthedemandfor,andputtingpricepressureon,ourplatform.Inaddition,somecompetitorsmakeopensourcesoftwareavailableforfreedownloadanduseormaypositioncompetingopensourcesoftwareasalossleader.Wecannotguaranteethatwewillbeabletocompetesuccessfullyagainstcurrentandfuturecompetitorsorthatcompetitivepressureand/ortheavailabilityofopensourcesoftwarewillnotresultinpricereductions,reducedoperatingmarginsandlossofmarketshare,anyoneofwhichcouldseriouslyharmourbusiness.

If our customers do not renew or expand their subscriptions, or if they renew on less favorable terms, our future revenue and operating results will be harmed.

Ourfuturesuccessdepends,inpart,onourabilitytosellrenewalsofsubscriptionsandexpandthedeploymentofourplatformwithexistingcustomers.Whilewegenerallyoffersubscriptionsofuptothreeyearsinlength,ourcustomerstypicallypurchaseone-yearsubscriptionswhichgenerallydonotprovideforautomaticrenewalorarighttoterminatethesubscriptionearly.Ourcustomersmaynotreneworexpandtheuseoftheirsubscriptionsaftertheexpirationoftheircurrentsubscriptionagreements.Inaddition,ourcustomersmayoptforalower‑pricededitionofourplatformordecreasetheirusageofourplatform.Ourexistingcustomersgenerallyhavenocontractualobligationtoexpandorrenewtheirsubscriptionsaftertheexpirationofthecommittedsubscriptionperiodandgivenourlimitedoperatinghistory,wemaynotbeabletoaccuratelypredictcustomerrenewalrates.Ourcustomers’renewaland/orexpansionpricingratesmaydeclineorfluctuateasaresultoffactors,including,butnotlimitedto,theirsatisfactionwithourplatformandourcustomersupport,thefrequencyandseverityofsoftwareandimplementationerrors,ourplatform’sreliability,thepricingofoursubscriptionsandservices,orcompetingsolutionsorservices,theeffectsofglobaleconomicconditionsandtheirabilitytocontinuetheiroperationsandspendinglevels.Ifourcustomersrenewtheirsubscriptions,theymayrenewforshortercontractlengths,lessusageoronothertermsthatarelesseconomicallybeneficialtous.Wehavelimitedhistoricaldatawithrespecttoratesofcustomersubscriptionrenewals,sowemaynotaccuratelypredictfuturerenewaltrends.Wecannotassureyouthatourcustomerswillreneworexpandtheirsubscriptions,andifourcustomersdonotrenewtheiragreementsorrenewonlessfavorabletermsorforlessusage,ourrevenuemaygrowmoreslowlythanexpectedordeclineandourbusinesscouldsuffer.

Achievingrenewalorexpansionofsubscriptionsmayrequireustoincreasinglyengageinsophisticatedandcostlysaleseffortsthatmaynotresultinadditionalsales.Inaddition,therateatwhichourcustomersexpandthedeploymentofourplatformdependsonanumberoffactors,includinggeneraleconomicconditions,thefunctioningofoursolutions,theabilityofourfieldorganization,togetherwithourpartnerecosystem,toassistourcustomersinidentifyingnewusecases,modernizingtheirdataarchitectures,andachievingsuccesswithdata‑driveninitiativesandourcustomers’satisfactionwithourcustomersupport.Ifoureffortstoexpandpenetrationwithinourcustomersarenotsuccessful,ourbusinessmaysuffer.

Our sales cycles can be long, unpredictable and vary seasonally, particularly with respect to large subscriptions, and our sales efforts require considerable timeand expense.

Ourresultsofoperationsmayfluctuate,inpart,becauseoftheresource‑intensivenatureofoursalesefforts,thelengthandvariabilityofthesalescycleforourplatformandthedifficultyinmakingshort‑termadjustmentstoouroperatingexpenses.Thetimingofoursalesisdifficulttopredict.Thelengthofoursalescycle,frominitialevaluationtopaymentforoursubscriptionsisgenerallyfourtoninemonths,butcanvarysubstantiallyfrom

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customertocustomer.Oursalescyclecanextendtomorethan18monthsforsomecustomers.Oursaleseffortsinvolveeducatingourcustomersabouttheuse,technicalcapabilitiesandbenefitsofourplatform,solutionsandHOSSmodel.Customersoftenundertakeaprolongedevaluationprocess,whichfrequentlyinvolvesnotonlyourplatformbutalsothoseofothercompanies.Someofourcustomersinitiallydeployourplatformonalimitedbasis,withnoguaranteethatthesecustomerswilldeployourplatformwidelyenoughacrosstheirorganizationtojustifyoursubstantialpre‑salesinvestment.Asaresult,itisdifficulttopredictexactlywhen,orevenif,wewillmakeasaletoapotentialcustomerorifwecanincreasesalestoourexistingcustomers.Largeindividualsaleshave,insomecases,occurredinquarterssubsequenttothoseweanticipated,orhavenotoccurredatall.Ifoursalescyclelengthensoroursubstantialupfrontinvestmentsdonotresultinsufficientrevenuetojustifyourinvestments,ouroperatingresultscouldbeadverselyaffected.

Wehaveseasonalandend-of-quarterconcentrationofoursales,whichimpactsourabilitytoplanandmanagecashflowsandmargins.Oursalesvarybyseasonwiththefourthquartertypicallybeingourlargest.Inaddition,withineachquarter,mostsalesoccurinthelastmonthofthatquarter.Therefore,itisdifficulttodeterminewhetherweareachievingourquarterlyexpectationsuntilneartheendofthequarter,withseasonalitymagnifyingthedifficultyfordeterminingwhetherwewillachieveannualexpectations.Mostofourexpensesarerelativelyfixedorrequiretimetoadjust.Therefore,ifexpectationsforourbusinessarenotaccurate,wemaynotbeabletoadjustourcoststructureonatimelybasisandmarginsandcashflowsmaydifferfromexpectations.

We do not have an adequate history with our subscription or pricing models to accurately predict the long-term rate of customer adoption or renewal, or theimpact these will have on our revenue or operating results.

Wehavelimitedexperiencewithrespecttodeterminingtheoptimalpricesandpricingmodelsforoursolutions.Asthemarketsforoursolutionsmature,orasnewcompetitorsintroducenewproductsorservicesthatcompetewithours,wemaybeunabletoattractnewcustomersatthesamepriceorbasedonthesamepricingmodelaswehaveusedhistorically.Moreover,largecustomers,whicharethefocusofoursalesefforts,maydemandgreaterpriceconcessions.Additionally,therenewalrateofourlargecustomersmayhavemoresignificantimpactperiodtoperiodonourrevenueandoperatingresults.Asaresult,inthefuturewemayberequiredtoreduceourprices,whichcouldadverselyaffectourrevenue,grossmargin,profitability,financialpositionandcashflow.Inaddition,asanincreasingamountofourbusinessmaymovetoourcloud‑basedsolutionsfortransientworkloadsandtheuseofourconsumption‑basedpricingmodelmayrepresentagreatershareofourrevenue,ourrevenuemaybelesspredictableormorevariablethanourhistoricalrevenuefromatimeperiod‑basedsubscriptionpricingmodel.Moreover,aconsumption‑basedsubscriptionpricingmodelmayultimatelyresultinlowertotalcosttoourcustomersovertime,ormaycauseourcustomerstolimitusageinordertostaywithinthelimitsoftheirexistingsubscriptions,reducingoverallrevenueormakingitmoredifficultforustocompeteinourmarkets.

Our results may fluctuate significantly from period to period, which could adversely impact the value of our common stock.

Ourresultsofoperations,includingourrevenue,netrevenueexpansionrate,grossmargin,profitabilityandcashflows,mayvarysignificantlyinthefuture,andperiod‑to‑periodcomparisonsofouroperatingresultsmaynotbemeaningful.Accordingly,ourresultsforanyparticularperiodshouldnotberelieduponasanindicationoffutureperformance.Ourfinancialresultsmayfluctuatefromperiodtoperiodasaresultofavarietyoffactors,manyofwhichareoutsideofourcontrol.Fluctuationinperiodicresultsmayadverselyimpactthevalueofourcommonstock.Factorsthatmaycausefluctuationsinourperiodicfinancialresultsinclude,withoutlimitation,thoselistedelsewhereinthis“RiskFactors”sectionandthoselistedbelow:

• thebudgetingcyclesandpurchasingpracticesofourcustomers,includingtheirtendencytopurchaseinthefourthquarterofourfiscalyear,andneartheendofeachquarter;

• theachievementofmilestonesinconnectionwithdeliveryofservices,impactingthetimingofservicesrevenuerecognition;

• subscriptionsfromtheGlobal8000andotherlargeenterprises;

• pricecompetition;

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• ourabilitytoattractandretainnewcustomers;

• ourabilitytoexpandpenetrationwithinourexistingcustomerbase;

• thetimingandsuccessofnewsolutionsbyusandourcompetitors;

• changesincustomerrequirementsormarketneedsandourabilitytomakecorrespondingchangestoourbusiness;

• changesinthecompetitivelandscape,includingconsolidationamongourcompetitorsorcustomers;

• generaleconomicconditions,bothdomesticallyandinourforeignmarkets;

• thetimingandamountofcertainpaymentsandexpenses,suchasresearchanddevelopmentexpenses,salescommissionsandstock‑basedcompensation,includingtherecordingofstock‑basedcompensationexpenseasaresultofthevestingandsettlementofrestrictedstockunits(RSUs)includinginconnectionwiththisoffering;

• ourinabilitytoadjustcertainfixedcostsandexpenses,particularlyinresearchanddevelopment,forchangesindemand;

• increasesordecreasesinourrevenueandexpensescausedbyfluctuationsinforeigncurrencyexchangerates,asanincreasingportionofourrevenueiscollectedandexpensesareincurredandpaidincurrenciesotherthantheU.S.dollar;

• thecostofandpotentialoutcomesofexistingandfutureclaimsorlitigation,whichcouldhaveamaterialadverseeffectonourbusiness;

• futureaccountingpronouncementsandchangesinouraccountingpolicies;and

• changesintaxlawsortaxregulations.

Anyoneofthefactorsaboveorthecumulativeeffectofsomeofthefactorsabovemayresultinsignificantfluctuationsinouroperatingresults.Thisvariabilityandunpredictabilitycouldresultinourfailuretomeetourrevenueorotheroperatingresultexpectationsorthoseofinvestorsforaparticularperiod.Thefailuretomeetorexceedsuchexpectationscouldhaveamaterialadverseeffectonourbusiness,resultsofoperationsandfinancialconditionthatcouldultimatelyadverselyaffectourstockprice.

Because we derive substantially all of our revenue from a single software platform, failure of this platform to satisfy customer demands or to achieve increasedmarket acceptance could adversely affect our business, results of operations, financial condition and growth prospects.

Wederiveandexpecttocontinuetoderivesubstantiallyallofourrevenuefromourdatamanagement,machinelearningandanalyticsplatform.Assuch,themarketacceptanceofourplatformiscriticaltoourcontinuedsuccess.Demandforourplatformisaffectedbyanumberoffactorsbeyondourcontrol,includingcontinuedmarketacceptance,thetimingofdevelopmentandreleaseofnewproductsbyourcompetitors,technologicalchange,anydevelopmentsordisagreementswiththeopensourcecommunityandgrowthorcontractioninourmarket.Weexpectthegrowthandproliferationofdatatoleadtoanincreaseinthedataanalysesdemandsofourcustomers,andourplatformmaynotbeabletoscaleandperformtomeetthosedemandsormaynotbechosenbyusersforthoseneeds.Ifweareunabletocontinuetomeetcustomerdemandsortoachievemorewidespreadmarketacceptanceofourplatformandsolutions,ourbusinessoperations,financialresultsandgrowthprospectswillbemateriallyandadverselyaffected.

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We have been, and may in the future be, subject to intellectual property rights claims by third parties, which are extremely costly to defend, could require us topay significant damages and could limit our ability to use certain technologies.

Companiesinthesoftwareandtechnologyindustries,includingsomeofourcurrentandpotentialcompetitors,ownlargenumbersofpatents,copyrights,trademarksandtradesecretsandfrequentlyenterintolitigationbasedonallegationsofinfringementorotherviolationsofintellectualpropertyrights.Inaddition,manyofthesecompanieshavethecapabilitytodedicatesubstantiallygreaterresourcestoenforcetheirintellectualpropertyrightsandtodefendclaimsthatmaybebroughtagainstthem.Thelitigationmayinvolvepatentholdingcompaniesorotheradversepatentownersthathavenorelevantproductrevenueandagainstwhichourpatentsmaythereforeprovidelittleornodeterrence.Fromtime‑to‑time,thirdparties,includingcertainothercompanies,haveassertedandmayassertpatent,copyright,trademarkorotherintellectualpropertyrightsagainstus,ourpartnersorourcustomers.Weorourcustomershavereceived,andmayinthefuturereceive,noticesthatclaimwehavemisappropriated,misusedorinfringedotherparties’intellectualpropertyrights,and,totheextentwegaingreatermarketvisibility,wefaceahigherriskofbeingthesubjectofintellectualpropertyinfringementclaims,whichisnotuncommonwithrespecttotheenterprisesoftwaremarket.Asanexample,onMay26,2017,PlaintiffsUniversityofTennesseeResearchFoundationandSaintMathewResearchLLC(Plaintiffs),filedalawsuitagainstusintheU.S.DistrictCourtfortheMiddleDistrictofTennessee.Thesuitallegesthatcertainsoftwareproductsthataremade,usedorsoldbyClouderainfringeU.S.PatentNos.7,454,411and8,099,733.Plaintiffsseekdamages,anawardofenhanceddamages,andrecoveryofattorney’sfeesandcostsincurredinthesuit.

Theremaybethird‑partyintellectualpropertyrights,includingissuedorpendingpatents,thatcoversignificantaspectsofourtechnologies,thetechnologiesinourplatformorbusinessmethods.Wemaybeexposedtoincreasedriskofbeingthesubjectofintellectualpropertyinfringementclaimsasaresultofacquisitionsandourincorporationofopensourcesoftwareintoourplatform,as,amongotherthings,wehavealowerlevelofvisibilityintothedevelopmentprocesswithrespecttosuchtechnologyorthecaretakentosafeguardagainstinfringementrisks.Anyintellectualpropertyclaims,withorwithoutmerit,couldbeverytime‑consuming,couldbeexpensivetosettleorlitigateandcoulddivertourmanagement’sattentionandotherresources.Theseclaimscouldalsosubjectustosignificantliabilityfordamages,potentiallyincludingtrebledamagesifwearefoundtohavewillfullyinfringedpatentsorcopyrights.Theseclaimscouldalsoresultinourhavingtostopusing,distributingorsupportingtechnologyfoundtobeinviolationofathirdparty’srights.Wemightberequiredtoseekalicensefortheintellectualproperty,whichmaynotbeavailableonreasonabletermsoratall.Evenifalicensewereavailable,wecouldberequiredtopaysignificantroyalties,whichwouldincreaseouroperatingexpenses.Asaresult,wemayberequiredtodevelopalternativenon‑infringingtechnology,whichcouldrequiresignificanteffortandexpense.Ifwecannotlicenseordeveloptechnologyforanyinfringingaspectofourbusiness,wecouldbeforcedtolimitorstopsalesofourofferingsandmaybeunabletocompeteeffectively.Anyoftheseresultscouldadverselyaffectourbusinessoperationsandfinancialresults.

Thirdpartiesmayalsoassertsuchclaimsagainstourcustomersorpartnerswhomwetypicallyindemnifyagainstclaimsthatoursolutionsinfringe,misappropriateorotherwiseviolatetheintellectualpropertyrightsofthirdparties,includinginthethird‑partyopensourcecomponentsincludedinourplatform,aswellasourownopensourceandproprietarycomponents.Asthenumbersofproductsandcompetitorsinourmarketincreaseandoverlapsoccur,claimsofinfringement,misappropriationandotherviolationsofintellectualpropertyrightsmayincrease.Also,totheextentwehirepersonnelfromcompetitors,wemaybesubjecttoallegationsthattheyhavebeenimproperlysolicitedorhavedivulgedproprietaryorotherconfidentialinformation.

Any failure to protect our intellectual property rights could impair our ability to protect our proprietary technology and our brand.

Oursuccessdepends,inpart,onourabilitytoprotectproprietarymethodsandtechnologiesthatwedevelopunderpatentandotherintellectualpropertylawsoftheUnitedStatesandotherjurisdictionsoutsideoftheUnitedStatessothatwecanpreventothersfromusingourinventionsandproprietaryinformation.Ifwefailtoprotectourintellectualpropertyrightsadequately,ourcompetitorsmaygainaccesstoourtechnology,andourbusinessmaybeharmed.Inaddition,defendingourintellectualpropertyrightsmayentailsignificantexpense.Anyofourpatents,trademarksorotherintellectualpropertyrightsmaybechallengedbyothersorinvalidatedthroughadministrative

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processorlitigation.Whilewehavepatentsandpatentapplicationspending,wemaybeunabletoobtainpatentprotectionforthetechnologycoveredinourpatentapplicationsorthepatentprotectionmaynotbeobtainedquicklyenoughtomeetourbusinessneeds.Inaddition,ourexistingpatentsandanypatentsissuedinthefuturemaynotprovideuswithcompetitiveadvantages,ormaybesuccessfullychallengedbythirdparties.

Moreover,despiteoureffortstoprotectourproprietaryrights,unauthorizedpartiesmayattempttocopyaspectsofourplatformorofferingsorobtainanduseinformationthatweregardasproprietary.Wegenerallyenterintoconfidentialityorlicenseagreementswithouremployees,consultants,vendorsandcustomers,andgenerallylimitaccesstoanddistributionofourproprietaryinformation.However,wecannotbecertainthatwehaveenteredintosuchagreementswithallpartieswhomayhaveorhavehadaccesstoourconfidentialinformationorthattheagreementswehaveenteredintowillnotbebreached.Wecannotguaranteethatanyofthemeasureswehavetakenwillpreventmisappropriationofourtechnology.Becausewemaybeanattractivetargetforcybersecurityattacks,wemayhaveagreaterriskofunauthorizedaccessto,andmisappropriationof,ourproprietaryinformation.

Furthermore,legalstandardsrelatingtothevalidity,enforceabilityandscopeofprotectionofintellectualpropertyrightsareuncertain,andwealsomayfaceproposalstochangethescopeofprotectionforsomeintellectualpropertyright.Effectivepatent,trademark,copyrightandtradesecretprotectionmaynotbeavailabletousineverycountryinwhichourproductsorservicesareavailable.ThelawsofsomecountriesmaynotbeasprotectiveofintellectualpropertyrightsasthoseintheUnitedStates,andmechanismsforenforcementofintellectualpropertyrightsmaybeinadequate.Also,ourinvolvementinstandardsettingactivityortheneedtoobtainlicensesfromothersmayrequireustolicenseourintellectualproperty.Accordingly,despiteourefforts,wemaybeunabletopreventthirdpartiesfromusingourintellectualproperty.

Wemayberequiredtospendsignificantresourcestomonitorandprotectourintellectualpropertyrightsandwemayconcludethatinatleastsomeinstancesthebenefitsofprotectingourintellectualpropertyrightsmaybeoutweighedbytheexpense.Wemayinitiateclaimsorlitigationagainstthirdpartiesforinfringementofourproprietaryrightsortoestablishthevalidityofourproprietaryrights.Anylitigation,whetherornotitisresolvedinourfavor,couldresultinsignificantexpensetousanddiverttheeffortsofourtechnicalandmanagementpersonnel.

We do not control and may be unable to predict the future course of open source technology development, including the ongoing development of open sourcecomponents used in our platform, which could reduce the market appeal of our platform and damage our reputation.

Wedonotcontrolmanyaspectsofthedevelopmentoftheopensourcetechnologyinourplatform.Differentgroupsofopensourcesoftwareprogrammerscollaboratewithoneanothertodevelopthesoftwareprojectsinourplatform.Giventhedisparateinputsfromvariousdevelopers,wecannotcontrolentirelyhowanopensourceprojectdevelopsandmatures.Also,differentopensourceprojectsmayoverlaporcompetewiththeonesthatweincorporateintoourplatform.Thetechnologydevelopedbyonegroupforoneprojectmaybecomemorewidelyusedthanthatdevelopedbyothers.Ifweacquireoradoptanewtechnologyandincorporateitintoourplatformbutacompetingtechnologybecomesmorewidelyusedoraccepted,themarketappealofourplatformmaybereducedandthatcouldharmourreputation,diminishourbrandandresultindecreasedrevenue.

If open source software programmers, many of whom we do not employ, or our own internal programmers do not continue to develop and enhance opensource technologies, we may be unable to develop new technologies, adequately enhance our existing technologies or meet customer requirements forinnovation, quality and price.

Werelytoasignificantdegreeonanumberofopensourcesoftwareprogrammers,orcommittersandcontributors,todevelopandenhancecomponentsofourplatform.Additionally,membersofthecorrespondingApacheSoftwareFoundationProjectManagementCommittees(PMCs)manyofwhomarenotemployedbyus,areprimarilyresponsiblefortheoversightandevolutionofthecodebasesofimportantcomponentsoftheopensourcedatamanagementecosystem.Iftheopensourcedatamanagementcommittersandcontributorsfailtoadequatelyfurtherdevelopandenhanceopensourcetechnologies,orifthePMCsfailtooverseeandguidetheevolutionofopensourcedatamanagementtechnologiesinthemannerthatwebelieveisappropriatetomaximizethemarketpotentialofoursolutions,thenwewouldhavetorelyonotherparties,orwewouldneedtoexpendadditionalresources,todevelopandenhanceourplatform.Wealsomustdevoteadequateresourcestoourowninternalprogrammerstosupporttheircontinueddevelopmentandenhancementofopensourcetechnologies,andifwedo

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notdoso,wemayhavetoturntothirdpartiesorexperiencedelaysindevelopingorenhancingopensourcetechnologies.Wecannotpredictwhetherfurtherdevelopmentsandenhancementstothesetechnologieswouldbeavailablefromreliablealternativesources.Ineitherevent,ourdevelopmentexpensescouldbeincreasedandourtechnologyreleaseandupgradeschedulescouldbedelayed.Delaysindeveloping,completingordeliveringneworenhancedcomponentstoourplatformcouldcauseourofferingstobelesscompetitive,impaircustomeracceptanceofoursolutionsandresultindelayedorreducedrevenueforoursolutions.

Our software development and licensing model could be negatively impacted if the Apache License, Version 2.0 is not enforceable or is modified so as tobecome incompatible with other open source licenses.

ImportantcomponentsofourplatformhavebeenprovidedundertheApacheLicense2.0.Thislicensestatesthatanyworkofauthorshiplicensedunderit,andanyderivativeworkthereof,maybereproducedanddistributedprovidedthatcertainconditionsaremet.Itispossiblethatacourtwouldholdthislicensetobeunenforceableorthatsomeonecouldassertaclaimforproprietaryrightsinaprogramdevelopedanddistributedunderit.Anyrulingbyacourtthatthislicenseisnotenforceable,orthatopensourcecomponentsofourplatformmaynotbereproducedordistributed,maynegativelyimpactourdistributionordevelopmentofalloraportionofoursolutions.Inaddition,atsometimeinthefutureitispossiblethatimportantcomponentsoftheopensourceprojectsinourplatformmaybedistributedunderadifferentlicenseortheApacheLicense2.0,whichgovernsHadoop,Sparkandothercurrentelementsofourplatform,maybemodified,whichcould,amongotherconsequences,negativelyimpactourcontinuingdevelopmentordistributionofthesoftwarecodesubjecttothenewormodifiedlicense.

Further,fullutilizationofourplatformmaydependonsoftware,applications,hardwareandservicesfromvariousthirdparties,andtheseitemsmaynotbecompatiblewithourplatformanditsdevelopmentoravailabletousorourcustomersoncommerciallyreasonableterms,oratall,whichcouldharmourbusiness.

Our use of open source software in our solutions could negatively affect our ability to sell our platform and subject us to possible litigation.

Oursolutionsincludesoftwarecoveredbyopensourcelicenses,whichmayinclude,bywayofexample,GNUGeneralPublicLicenseandtheApacheLicense.Wedonotownalloftheopensourcetechnologyinourplatformandtheownershipoftheopensourcetechnologyinourplatformmaynotbeeasilydeterminablebyus.Rather,werelyontheApacheSoftwareFoundation(ASF)aswellascertainotherthirdpartyopensourcecontributorstoensurethattheopensourcecontributionstoourplatformareproperlyownedbythecommittersandcontributorswhocontributetheopensourcetechnologyandthatsuchcontributionsdonotinfringeonotherparties’intellectualpropertyrights.Moreover,thetermsofcertainoftheopensourcelicenseshavenotbeeninterpretedbyUnitedStatesorothercourts,andthereisariskthatsuchlicensescouldbeconstruedinamannerthatisincompatiblewithourcurrentbusinessmodel,imposingunanticipatedconditionsorrestrictionsonourabilitytomarketoursolutions.We,ourcustomersandtheASFmayhavereceivedormayinthefuturereceive,noticesthatclaimwehavemisappropriated,misusedorinfringedotherparties’intellectualpropertyrights,and,totheextentproductsbasedontheopensourcedatamanagementecosystemgaingreatermarketvisibility,we,ourcustomers,andtheASF,faceahigherriskofbeingthesubjectofintellectualpropertyinfringementclaims.Inaddition,weorourcustomerscouldbesubjecttolawsuitsbypartiesclaimingownershipof(orthatdifferentlicensetermsapplyto)whatwebelievetobeopensourcesoftware,orseekingtoenforcethetermsofanopensourcelicense.Bythetermsofcertainopensourcelicenses,wecouldberequiredtoreleasethesourcecodeofourproprietarysoftware,andtomakeourproprietarysoftwareavailableunderopensourcelicenses,ifwecombineourproprietarysoftwarewithopensourcesoftwareinacertainmanner.Intheeventthatportionsofourproprietarysoftwarearedeterminedtobeimpactedbyanopensourcelicense,wecouldberequiredtopubliclyreleasetheaffectedportionsofoursourcecode,re‑engineeralloraportionofourtechnologies,orotherwisebelimitedinthelicensingofourtechnologiesandservices,eachofwhichcouldreduceoreliminatethevalueofourtechnologiesandcauseustohavetosignificantlyalterourcurrentbusinessmodel.Theseclaimscouldalsoresultinlitigation(includinglitigationagainstourcustomersorpartners,whichcouldresultinusbeingobligatedtoindemnifyourcustomersorpartnersagainstsuchlitigation),requireustopurchaseacostlylicenseorrequireustodevoteadditionalresearchanddevelopmentresourcestochangeoursolutions,anyofwhichcouldhaveanegativeeffectonourbusinessandoperatingresults.Inaddition,ifthelicensetermsfortheopensourcecodechange,wemaybeforcedtore‑engineeroursolutionsorincuradditionalcoststofindalternativetools.

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Inadditiontorisksrelatedtolicenserequirements,usageofopensourcesoftwarecanleadtogreaterrisksthanuseofthird‑partycommercialsoftware,asopensourcelicensorsgenerallydonotprovidewarranties,support,indemnityorassuranceoftitleorcontrolsonoriginofthesoftware.Further,someopensourceprojectshaveknownvulnerabilitiesandarchitecturalinstabilitiesandareprovidedonan“as‑is”basis.Manyoftheserisksassociatedwithusageofopensourcesoftware,suchasthelackofwarrantiesorassurancesoftitle,cannotbeeliminated,andcould,ifnotproperlyaddressed,negativelyaffecttheperformanceofourplatformandourbusiness.Inaddition,weareoftenrequiredtoabsorbtheserisksinourcustomerandpartnerrelationshipsbyagreeingtoprovidewarranties,supportandindemnificationwithrespecttosuchthirdpartyopensourcesoftware.Whilewehaveestablishedprocessesintendedtoalleviatetheserisks,wecannotassurethatthesemeasureswillreducetheserisks.

Because our business relies on the Apache Software Foundation, our business could be harmed by the decisions made by the ASF or claims or disputesdirected at or reputational harm otherwise suffered by the ASF.

OurbusinessreliesontheASF,anon‑profitcorporationthatsupportsApacheopensourcesoftwareprojects.WedonotcontrolnorcanwepredictthedecisionstheASFwillmakewithrespecttothefurtherdevelopmentandenhancementofopensourcetechnologieswhichmayimpactourbusiness.Forexample,thereductionoreliminationofsupportofHadoop,SparkorothertechnologiesbytheASF,themigrationofHadoop,SparkandotheropensourcedatamanagementtechnologytoanorganizationotherthantheASF,oranyotheractionstakenbytheASFortheHadoopprojectmayimpactourbusinessmodel.Moreover,iftheASFissubjecttoclaims,disputesorotherwisesuffersreputationalharm,ourbusiness,resultsofoperations,financialconditionandgrowthprospectscouldbeharmedifcustomersperceiveoursolutionstoberiskyorinferiortodatamanagementsolutionswhichdonotrelyontheASFforcontinueddevelopmentandenhancementofopensourcetechnologies.

Security and privacy breaches may hurt our business.

Anysecuritybreach,includingthoseresultingfromacybersecurityattack,oranyunauthorizedaccess,unauthorizedusage,virusorsimilarbreachordisruptioncouldresultinthelossofconfidentialinformation,damagetoourreputation,earlyterminationofourcontracts,litigation,regulatoryinvestigationsorotherliabilities.Ifoursecuritymeasuresorthesecuritymeasureswehaveprovidedtocustomersarebreachedasaresultofthird‑partyaction,employeeerror,malfeasanceorotherwiseand,asaresult,someoneobtainsunauthorizedaccesstoourcustomers’confidentialinformation,ourreputationmaybedamaged,ourbusinessmaysufferandwecouldincursignificantliability.

Techniquesusedtoobtainunauthorizedaccessortosabotagesystemschangefrequentlyandgenerallyarenotrecognizeduntillaunchedagainstatarget.Asaresult,wemaybeunabletoanticipatethesetechniquesortoimplementadequatepreventativemeasures.Ifanactualorperceivedsecuritybreachoccurs,themarketperceptionofoursecuritymeasurescouldbeharmedandwecouldlosesalesandcustomers.

Inaddition,manyofourcustomersuseourplatformtostoreandprocessvastquantitiesofprivateandotherwisesensitivedatathatarecriticaltotheirbusinesses.Theymayhaveagreatersensitivitytosecuritydefectsinourproductsthantodefectsinother,lesscritical,softwareproducts.Anactualorperceivedsecuritybreachortheftofthebusiness‑criticaldataofoneofourcustomers,regardlessofwhetherthebreachisattributabletothefailureofourproductsorservices,couldadverselyaffectthemarket’sperceptionofoursecurityproducts.Moreover,ifahigh‑profilesecuritybreachoccurswithrespecttoanotherdatamanagement,machinelearningandanalyticsplatformprovider,ourcustomersandpotentialcustomersmaylosetrustinthesecurityofdatamanagement,machinelearningandanalyticsplatformsgenerally,whichcouldadverselyimpactourabilitytoretainexistingcustomersorattractnewones.

Real or perceived errors, failures, bugs or disruptions in our platform and solutions could adversely affect our reputation and business could be harmed.

Ourplatformandsolutionsareverycomplexandhavecontainedandmaycontainundetecteddefectsorerrors,especiallywhensolutionsarefirstintroducedorenhanced.Inaddition,ourplatformemploysopensourcesoftwareandtotheextentthatoursolutionsdependuponthesuccessfuloperationofopensourcesoftwareinconjunctionwithoursolutions,anyundetectederrorsordefectsinthisopensourcesoftwarecouldpreventthedeploymentor

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impairthefunctionalityofoursolutions,delaynewsolutionsintroductions,resultinafailureofoursolutions,resultinliabilitytoourcustomers,andinjureourreputation.

Ifourplatformisnotimplementedorusedcorrectlyorasintended,inadequateperformanceanddisruptioninservicemayresult.Moreover,asweacquirecompaniesandintegratenewopensourcedatamanagementprojects,wemayencounterdifficultyinincorporatingthenewly‑obtainedtechnologiesintoourplatformandmaintainingthequalitystandardsthatareconsistentwithourreputation.

Sinceourcustomersuseourplatformandsolutionsforimportantaspectsoftheirbusiness,anyerrors,defects,disruptionsinserviceorotherperformanceproblemscouldhurtourreputationandmaydamageourcustomers’businesses.Furthermore,defectsinourplatformandsolutionsmayrequireustoimplementdesignchangesorsoftwareupdates.Anydefectsorerrorsinourplatformandsolutions,ortheperceptionofsuchdefectsorerrors,couldresultin:

• expenditureofsignificantfinancialandproductdevelopmentresourcesineffortstoanalyze,correct,eliminateorworkarounderrorsordefects;

• lossofexistingorpotentialcustomersorchannelpartners;

• delayedorlostrevenue;

• delayorfailuretoattainmarketacceptance;

• delayinthedevelopmentorreleaseofnewsolutionsorservices;

• negativepublicity,whichwillharmourreputation;

• warrantyclaimsagainstus,whichcouldresultinanincreaseinourprovisionfordoubtfulaccounts;

• anincreaseincollectioncyclesforaccountsreceivableortheexpenseandriskoflitigation;and

• harmtoourresultsofoperations.

Althoughwehavecontractualprotections,suchaswarrantydisclaimersandlimitationofliabilityprovisions,inourstandardtermsandconditionsofsale,theymaynotfullyoreffectivelyprotectusfromclaimsbycustomers,partnersorotherthirdparties.Anyinsurancecoveragewemayhavemaynotadequatelycoverallclaimsassertedagainstus,orcoveronlyaportionofsuchclaims.Inaddition,evenclaimsthatultimatelyareunsuccessfulcouldresultinourexpenditureoffundsinlitigationanddivertmanagement’stimeandotherresources.

If we are unable to hire, retain, train and motivate qualified personnel and senior management, our business could be harmed.

Ourfuturesuccessdepends,inpart,onourabilitytocontinuetoattract,integrateandretainqualifiedandhighlyskilledpersonnel.Inparticular,wearesubstantiallydependentonthecontinuedserviceofourexistingengineeringpersonnelbecauseofthecomplexityofourplatformandarealsohighlydependentonthecontributionsofourexecutiveteam.Thelossofanykeypersonnelcouldmakeitmoredifficulttomanageouroperationsandresearchanddevelopmentactivities,reduceouremployeeretentionandrevenueandimpairourabilitytocompete.Althoughwehaveenteredintoemploymentofferletterswithourkeypersonnel,theseagreementshavenospecificdurationandconstituteat‑willemployment.Wedonotmaintainkeypersonlifeinsurancepoliciesonanyofouremployees.Thelossofoneormoreofourkeyemployeescouldseriouslyharmourbusiness.Ifweareunabletoattract,integrate,orretainthequalifiedandhighlyskilledpersonnelrequiredtofulfillourcurrentorfutureneeds,ourbusiness,financialconditionandoperatingresultscouldbeharmed.

Competitionforhighlyskilledpersonnelisoftenintense,especiallyintheSanFranciscoBayAreawherewehaveasubstantialpresenceandneedforhighlyskilledpersonnel.Wemaynotbesuccessfulinattracting,integratingorretainingqualifiedpersonneltofulfillourcurrentorfutureneeds.Wehavefromtimetotimeexperienced,andweexpecttocontinuetoexperience,difficultyinhiringandretaininghighlyskilledemployeeswithappropriatequalifications.Inaddition,jobcandidatesandexistingemployeesoftenconsiderthevalueoftheequityawardsthey

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receiveinconnectionwiththeiremployment.Iftheperceivedvalueofourcommonstockdeclines,itmayadverselyaffectourabilitytohireorretainhighlyskilledemployees.Inaddition,wemayperiodicallychangeourequitycompensationpractices,whichmayincludereducingthenumberofemployeeseligibleforequityawardsorreducingthesizeofequityawardsgrantedperemployee.Ifwefailtoattractnewpersonnelorfailtoretainandmotivateourcurrentpersonnel,ourbusinessandfuturegrowthprospectscouldbeharmed.

We have experienced rapid growth in recent periods and expect our growth to continue. If we fail to effectively manage our growth, our business and operatingresults could be adversely affected.

Wehaveexperiencedandmaycontinuetoexperiencerapidgrowthinourheadcountandoperations,whichhasplacedandwillcontinuetoplacesignificantdemandsonourmanagerial,administrative,operational,financialandotherresources.Forexample,ouremployeeheadcountincreasedfrom1,140employeesasofJanuary31,2016to1,470employeesasofJanuary31,2017to1,606employeesasofJuly31,2017.Thisgrowthhasplaced,andanyfuturegrowthwillplace,significantdemandsonourmanagementandouroperationalandfinancialinfrastructure.Tomanagethisgrowtheffectively,wemustcontinuetoimproveouroperational,financialandmanagementsystemsandcontrolsby,amongotherthings:

• recruiting,training,integratingandretainingnewemployees,particularlyforoursalesandresearchanddevelopmentteams;

• developingandimprovingourinternaladministrativeinfrastructure,particularlyourfinancial,operational,compliance,recordkeeping,communicationsandotherinternalsystems;

• managingourinternationaloperationsandtherisksassociatedtherewith;

• maintaininghighlevelsofsatisfactionwithourplatformamongourcustomers;and

• effectivelymanagingexpensesrelatedtoanyfuturegrowth.

Ifwefailtomanageourgrowth,orifwefailtoimplementimprovementsormaintaineffectiveinternalcontrols,ourcostsandexpensesmayincreasemorethanweplanandourabilitytoexpandourcustomerbase,enhanceourplatform,developnewsolutions,expandpenetrationwithinexistingcustomers,respondtocompetitivepressuresorotherwiseexecuteourbusinessplan,ourbusinessandoperatingresultscouldbeadverselyaffected.

Because we recognize subscription revenue from our platform over the subscription term, downturns or upturns in new sales and renewals will not beimmediately reflected in our operating results.

Wegenerallyrecognizesubscriptionrevenueratablyoverthetermofthesubscriptionperiod.Asaresult,mostoftherevenuewereportineachquarterarederivedfromtherecognitionofdeferredrevenuerelatingtosubscriptionsenteredintoduringpreviousquarters.Consequently,adeclineinneworrenewedsubscriptions,orareductioninexpansionrates,inanysinglequartercouldhaveonlyasmallimpactonourrevenueresultsduringthatquarterorsubsequentperiod.Suchadeclineordeceleration,however,willnegativelyaffectourrevenueorrevenuegrowthratesinfuturequarters.Accordingly,theeffectofthesechangesoreventsmaynotbefullyreflectedinourresultsofoperationsuntilfutureperiods.Giventheratablenatureofourrevenuerecognition,oursubscriptionmodelalsomakesitdifficultforustorapidlyincreaseourrevenuethroughadditionalsalesinanyperiod.Wemaybeunabletoadjustourcoststructuretoreflectthechangesinrevenue.Inaddition,asignificantmajorityofourcostsareexpensedasincurred,whilerevenueisgenerallyrecognizedoverthelifeofthecustomeragreement.Asaresult,increasedgrowthinthenumberofourcustomerscouldresultinourrecognitionofmorecoststhanrevenueintheearlierperiodsofthetermsofouragreements.

Our revenue growth depends in part on the success of our strategic relationships with third parties and their continued performance.

Weseektogrowourpartnerecosystemasawaytogrowourbusiness.Togrowourbusiness,weanticipatethatwewillcontinuetoestablishandmaintainrelationshipswiththirdparties,suchasresellers,OEMs,systemintegrators,independentsoftwareandhardwarevendorsandplatformandcloudserviceproviders.Forexample,in2014,weenteredintoastrategiccollaborationandoptimizationagreementwithIntel.Inaddition,weworkclosely

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withselectvendorstodesignsolutionstospecificallyaddresstheneedsofcertainindustryverticalsorusecaseswithinthoseverticals,whichwerefertoasPartnerSolutions.Asouragreementswithstrategicpartnersterminateorexpire,wemaybeunabletoreneworreplacetheseagreementsoncomparableterms,oratall.Moreover,wecannotguaranteethatthecompanieswithwhichwehavestrategicrelationshipswillcontinuetodevotetheresourcesnecessarytoexpandourreach,increaseourdistributionandincreasethenumberofPartnerSolutionsandassociatedusecases.Inaddition,customersatisfactionwithPartnerSolutionsmaybelessthananticipated,negativelyimpactinganticipatedrevenuegrowthandresultsofoperations.Further,someofourstrategicpartnersoffercompetingproductsandservicesoralsoworkwithourcompetitors.Asaresultofthesefactors,manyofthecompanieswithwhichwehavestrategicalliancesmaychoosetopursuealternativetechnologiesanddevelopalternativeproductsandservicesinadditiontoorinlieuofourplatform,eitherontheirownorincollaborationwithothers,includingourcompetitors.Ifweareunsuccessfulinestablishingormaintainingourrelationshipswiththirdparties,ourabilitytocompeteinthemarketplaceortogrowourrevenuecouldbeimpairedandouroperatingresultsmaysuffer.Evenifwearesuccessfulinestablishingandmaintainingtheserelationshipswiththirdparties,wecannotassureyouthattheserelationshipswillresultinincreasedcustomerusageofourplatformorincreasedrevenue.

The sum of our revenue and changes in deferred revenue may not be an accurate indicator of business activity within a period.

Investorsoranalystssometimeslooktothesumofourrevenueandchangesindeferredrevenueasanindicatorofbusinessactivityinaperiodforbusinessessuchasours,sometimesreferredtoas“estimatedbillings.”However,thesemeasuresmaysignificantlydifferfromunderlyingbusinessactivityforanumberofreasonsincluding:

• arelativelylargenumberoftransactionsoccurattheendofthequarter.Invoicingofthosetransactionsmayormaynotoccurbeforetheendofthequarterbasedonanumberoffactorsincludingreceiptofinformationfromthecustomer,volumeoftransactionsandholidays.Ashiftofafewdayshaslittleeconomicimpactonourbusiness,butwillshiftdeferredrevenuefromoneperiodintothenext;

• multi‑yearupfrontbillingsmaydistorttrends;

• subscriptionsthathavedeferredstartdates;and

• servicesthatareinvoicedupondelivery.

Accordingly,wedonotbelievethatestimatedbillingsisanaccurateindicatoroffuturerevenueforanygivenperiodoftime.However,manycompaniesthatprovidesubscriptionsreportchangesinestimatedbillingsasakeyoperatingorfinancialmetric,anditispossiblethatanalystsorinvestorsmayviewthismetricasimportant.Thus,anychangesinourestimatedbillingscouldadverselyaffectthemarketpriceofourcommonstock.

The forecasts of market growth included in this prospectus may prove to be inaccurate, and, even if the markets in which we compete achieve the forecastedgrowth, we cannot assure you our business will grow at similar rates, if at all.

Growthforecastsaresubjecttosignificantuncertaintyandarebasedonassumptionsandestimatesthatmaynotprovetobeaccurate.Theforecastsinthisprospectusrelatingtotheexpectedgrowthinthemarketforourplatformwerepreparedbyathirdpartybasedontheirresearch,estimatesandassumptions.Whilethesefactorsmayseemreasonabletothemandus,theresultingforecastsmayprovetobeinaccurate.Evenifthismarketexperiencestheforecastedgrowthdescribedinthisprospectus,wemaynotgrowourbusinessatsimilarrates,oratall.Ourgrowthissubjecttomanyfactors,includingoursuccessinimplementingourbusinessstrategy,whichissubjecttomanyrisksanduncertainties.Accordingly,theforecastsofmarketgrowthincludedinthisprospectusshouldnotbetakenasindicativeofourfuturegrowth.

If our new components and enhancements to our platform do not achieve sufficient market acceptance, our financial results and competitive position willsuffer.

Wespendsubstantialamountsoftimeandmoneytoresearchanddevelopnewcomponentsandenhancementsofourplatformstoincorporateadditionalfeatures,improvefunctionalityorotherenhancementsinordertomeetour

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customers’rapidlyevolvingdemands.Whenwedevelopanewcomponentorenhancementtoourplatform,whetheropensourceorproprietary,wetypicallyincurexpensesandexpendresourcesupfronttodevelop,marketandpromotethenewcomponent.Therefore,whenwedevelopandintroducenewcomponentsorenhancementstoourplatform,theymustachievehighlevelsofmarketacceptanceinordertojustifytheamountofourinvestmentindevelopingandbringingthemtomarket.Forexample,ifournewfilesystembasedontheopensourceKuduprojectdoesnotgarnerwidespreadmarketadoptionandimplementation,ourgrowthprospects,futurefinancialresultsandcompetitivepositioncouldsuffer.

Ournewcomponentsorenhancementstoourplatformandchangestoourplatformcouldfailtoattainsufficientmarketacceptanceformanyreasons,including:

• ourfailuretopredictmarketdemandaccuratelyintermsofplatformfunctionality,includingcuratingnewopensourceprojects,andtosupplyaplatformthatmeetsthisdemandinatimelyfashion;

• delaysinreleasingtothemarketournewcomponentsorenhancementstoourplatformtothemarket;

• defects,errorsorfailures;

• complexityintheimplementationorutilizationofthenewcomponentsandenhancements;

• negativepublicityabouttheirperformanceoreffectiveness;

• introductionoranticipatedintroductionofcompetingplatformsbyourcompetitors;

• poorbusinessconditionsforourend‑customers,causingthemtodelayITpurchases;and

• reluctanceofcustomerstopurchaseplatformsincorporatingopensourcesoftwareortopurchasehybridplatforms.

Ifournewcomponentsorenhancementsandchangesdonotachieveadequateacceptanceinthemarket,ourcompetitivepositionwillbeimpaired,andourrevenuewillbediminished.Theadverseeffectonourfinancialresultsmaybeparticularlyacutebecauseofthesignificantresearch,development,marketing,salesandotherexpenseswewillhaveincurredinconnectionwiththenewsolutionsorenhancements.

If we do not effectively hire, retain, train and oversee our direct sales force, we may be unable to add new customers or increase sales to our existingcustomers, and our business may be adversely affected.

Wecontinuetobesubstantiallydependentonourdirectsalesforcetoobtainnewcustomersandincreasesaleswithexistingcustomers.Thereissignificantcompetitionforsalespersonnelwiththeskillsandtechnicalknowledgethatwerequire.Ourabilitytoachievesignificantrevenuegrowthwilldepend,inlargepart,onoursuccessinrecruiting,trainingandretainingsufficientnumbersofsalespersonneltosupportourgrowth,particularlyininternationalmarkets.Inaddition,alargepercentageofoursalesforceisnewtoourcompany.Newhiresrequiresignificanttrainingandmaytakesignificanttimebeforetheyachievefullproductivity.Ourrecenthiresandplannedhiresmaynotbecomeproductiveasquicklyasweexpect,andwemaybeunabletohireorretainsufficientnumbersofqualifiedindividualsinthemarketswherewedobusinessorplantodobusiness.Inaddition,growthofourdirectsalesforceleadstoincreasingdifficultyandcomplexityinitsorganization,managementandleadership,atwhichwemayproveunsuccessful.Ifweareunabletohireandtrainasufficientnumberofeffectivesalespersonnel,weareineffectiveatoverseeingagrowingsalesforce,orthesalespersonnelwehireareotherwiseunsuccessfulinobtainingnewcustomersorincreasingsalestoourexistingcustomerbase,ourbusinesswillbeadverselyaffected.

We may acquire or invest in companies and technologies, which may divert our management’s attention, and result in additional dilution to our stockholders.We may be unable to integrate acquired businesses and technologies successfully or achieve the expected benefits of such acquisitions or investments.

Aspartofourbusinessstrategy,wehaveacquiredcompaniesinthepastandmayevaluateandconsiderpotentialstrategictransactions,includingacquisitionsof,orinvestmentsin,businesses,technologies,services,productsandotherassetsinthefuture.Forexample,weacquiredGazzang,Inc.inJune2014andXplain.io,Inc.in

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February2015.Wealsomayenterintorelationshipswithotherbusinessestoexpandoursolutionsorourabilitytoprovideservices.Anacquisition,investmentorbusinessrelationshipmayresultinunforeseenoperatingdifficultiesandexpenditures.Inparticular,wemayencounterdifficultiesassimilatingorintegratingthebusinesses,technologies,products,personneloroperationsoftheacquiredcompanies,particularlyifthekeypersonneloftheacquiredcompanychoosenottoworkforus,theirtechnologyisnoteasilyadaptedtoworkwithours,orwehavedifficultyretainingthecustomersofanyacquiredbusinessduetochangesinownership,managementorotherwise.Negotiatingthesetransactionscanbetime‑consuming,difficultandexpensive,andourabilitytoclosethesetransactionsmayoftenbesubjecttoconditionsorapprovalsthatarebeyondourcontrol.Consequently,thesetransactions,evenifundertakenandannounced,maynotclose.

Evenifweareabletocompleteacquisitionsorenterintoalliancesandjointventuresthatwebelievewillbesuccessful,suchtransactionsareinherentlyrisky.Acquisitionsinvolvemanyrisks,includingthefollowing:

• anacquisitionmaynegativelyimpactourresultsofoperationsbecauseit:

– mayrequireustoincurcharges,includingintegrationandrestructuringcosts,bothone‑timeandongoing,aswellassubstantialdebtorliabilities,includingunanticipatedandunknownliabilities,

– maycauseadversetaxconsequences,substantialdepreciationordeferredcompensationcharges,

– mayresultinacquiredin‑processresearchanddevelopmentexpensesorinthefuturemayrequiretheamortization,write‑downorimpairmentofamountsrelatedtodeferredcompensation,goodwillandotherintangibleassets,or

– maynotgeneratesufficientfinancialreturnsforustooffsetouracquisitioncosts;

• wemayencounterdifficultiesorunforeseenexpendituresinintegratingthebusiness,technologies,products,personneloroperationsofanycompanythatweacquire,particularlyifkeypersonneloftheacquiredcompanydecidenottoworkforus;

• anacquisitionandintegrationprocessiscomplex,expensiveandtimeconsuming,andmaydisruptourongoingbusiness,divertresources,increaseourexpensesanddistractourmanagement;

• anacquisitionmayresultinadelayorreductionofcustomerpurchasesforbothusandthecompanyacquiredduetocustomeruncertaintyaboutcontinuityandeffectivenessofservicefromeithercompany;

• anacquisitionmayresultinincreasedregulatoryandcompliancerequirements;

• anacquisitionmayresultinincreaseduncertaintyifweenterintobusinesses,marketsorbusinessmodelsinwhichwehavelimitedornopriorexperienceandinwhichcompetitorshavestrongermarketpositions;

• wemayencounterdifficultiesinmaintainingthekeybusinessrelationshipsandthereputationsofthebusinessesweacquire,andwemaybedependentonunfamiliaraffiliatesandpartnersofthecompaniesweacquire;

• wemailfailtomaintainsufficientcontrols,policiesandprocedures,includingintegratinganyacquiredbusinessintoourcontrolenvironment;

• wemayfailtoachieveanticipatedsynergies,includingwithrespecttocomplementarysoftwareorservices;

• wemayobtainunanticipatedorunknownliabilities,includingintellectualpropertyorotherclaims,orbecomeexposedtounanticipatedrisksinconnectionwithanyacquisition;and

• anacquisitionmayinvolvetheentryintogeographicorbusinessmarketsinwhichwehavelittleornopriorexperience.

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Ifweareunabletoaddressthesedifficultiesandchallengesorotherproblemsencounteredinconnectionwithanyfutureacquisitionorinvestment,wemightnotrealizetheanticipatedbenefitsofthatacquisitionorinvestment,wemightincurunanticipatedliabilitiesorwemightotherwisesufferharmtoourbusinessgenerally.

Totheextentwepaytheconsiderationforanyfutureacquisitionsorinvestmentsincash,thepaymentwouldreducetheamountofcashavailabletousforotherpurposes.Futureacquisitionsorinvestmentscouldalsoresultindilutiveissuancesofourequitysecuritiesortheincurrenceofdebt,contingentliabilities,amortizationexpenses,orimpairmentchargesagainstgoodwillonourbalancesheet,anyofwhichcouldharmourfinancialconditionandnegativelyimpactourstockholders.

As we expand internationally, our business will become more susceptible to risks associated with international operations.

Wehaverecentlyexpandedinternationally,andintendtocontinuesuchinternationalexpansion.Forexample,wesellthevariouseditionsofourplatformthroughourdirectsalesforce,whichiscomprisedofinsidesalesandfieldsalespersonnel,andislocatedinavarietyofgeographicregions,includingtheUnitedStates,EuropeandAsia,andhavecustomerslocatedinover67countriesasofJuly31,2017.Weintendtocontinuetoexpandinternationally.

ConductinginternationaloperationssubjectsustorisksthatwehavenotgenerallyfacedintheUnitedStates.Theserisksinclude:

• challengescausedbydistance,language,culturalandethicaldifferencesandthecompetitiveenvironment;

• heightenedrisksofunethical,unfairorcorruptbusinesspractices,actualorclaimed,incertaingeographiesandofimproperorfraudulentsalesarrangementsthatmayimpactfinancialresultsandresultinrestatementsof,andirregularitiesin,financialstatements;

• foreignexchangerestrictionsandfluctuationsincurrencyexchangerates,includingthat,becauseamajorityofourinternationalcontractsaredenominatedinU.S.dollars,anincreaseinthestrengthoftheU.S.dollarmaymakedoingbusinesswithuslessappealingtoanon‑U.S.dollardenominatedcustomer;

• applicationofmultipleandconflictinglawsandregulations,includingcomplicationsduetounexpectedchangesinforeignlawsandregulatoryrequirements;

• risksassociatedwithtraderestrictionsandforeignimportrequirements,includingtheimportation,certificationandlocalizationofoursolutionsrequiredinforeigncountries,aswellaschangesintrade,tariffs,restrictionsorrequirements;

• newanddifferentsourcesofcompetition;

• potentiallydifferentpricingenvironments,longersalescyclesandlongeraccountsreceivablepaymentcyclesandcollectionsissues;

• managementcommunicationandintegrationproblemsresultingfromculturaldifferencesandgeographicdispersion;

• potentiallyadversetaxconsequences,includingmultipleandpossiblyoverlappingtaxstructures,thecomplexitiesofforeignvalue‑addedtaxsystems,restrictionsontherepatriationofearningsandchangesintaxrates;

• greaterdifficultyinenforcingcontracts,accountsreceivablecollectionandlongercollectionperiods;

• theuncertaintyandlimitationofprotectionforintellectualpropertyrightsinsomecountries;

• increasedfinancialaccountingandreportingburdensandcomplexities;

• lackoffamiliaritywithlocalslaws,customsandpractices,andlawsandbusinesspracticesfavoringlocalcompetitorsorpartners;and

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• political,socialandeconomicinstabilityabroad,terroristattacksandsecurityconcernsingeneral.

Theoccurrenceofanyoneoftheseriskscouldharmourinternationalbusinessand,consequently,ourresultsofoperations.Additionally,operatingininternationalmarketsrequiressignificantmanagementattentionandfinancialresources.Wecannotbecertainthattheinvestmentandadditionalresourcesrequiredtooperateinothercountrieswillproducedesiredlevelsofrevenueorprofitability.

Someofourbusinesspartnersalsohaveinternationaloperationsandaresubjecttotherisksdescribedabove.Evenifweareabletosuccessfullymanagetherisksofinternationaloperations,ourbusinessmaybeadverselyaffectedifourbusinesspartnersarenotabletosuccessfullymanagetheserisks.

Our business in countries with a history of corruption and transactions with foreign governments increase the risks associated with our international activities.

Asweoperateandsellinternationally,wearesubjecttotheForeignCorruptPracticesAct(FCPA),theUnitedKingdomBriberyActof2010,ortheUKBriberyAct,andotherlawsthatprohibitimproperpaymentsoroffersofpaymentstoforeigngovernmentsandtheirofficialsandpoliticalpartiesforthepurposeofobtainingorretainingbusiness.Wehaveoperations,dealwithandmakesalestogovernmentalcustomersincountriesknowntoexperiencecorruption,particularlycertainemergingcountriesinAfrica,EastAsia,EasternEurope,SouthAmericaandtheMiddleEast.Ouractivitiesinthesecountriescreatetheriskofunauthorizedpaymentsoroffersofpaymentsbyoneofouremployees,consultants,salesagentsorchannelpartnersthatcouldbeinviolationofvariousanti‑corruptionlaws,eventhoughthesepartiesmaynotbeunderourcontrol.Whilewehaveimplementedpoliciesandcontrolsintendedtopreventthesepracticesbyouremployees,consultants,salesagentsandchannelpartners,ourexistingsafeguardsandanyfutureimprovementsmayprovetobelessthaneffective,andouremployees,consultants,salesagentsorchannelpartnersmayengageinconductforwhichwemightbeheldresponsible.ViolationsoftheFCPA,theUKBriberyActandotherlawsmayresultinseverecriminalorcivilsanctions,includingsuspensionordebarmentfromU.S.governmentcontracting,andwemaybesubjecttootherliabilities,whichcouldnegativelyaffectourbusiness,operatingresultsandfinancialcondition.

We are subject to governmental export control, sanctions and import laws and regulations that could subject us to liability or impair our ability to compete ininternational markets.

Becauseweincorporateencryptionfunctionalityintoourplatform(includinganyproductscomprisingtheplatform),wearesubjecttocertainU.S.exportcontrollawsthatapplytoencryptionitems.Assuch,ourplatformmaybeexportedoutsidetheUnitedStatesthroughanexportlicenseexception;anexportlicenseisrequiredtocertaincountries,end‑usersandend‑uses.IfweweretofailtocomplywithsuchU.S.exportcontrolslaws,U.S.customsregulations,U.S.economicsanctions,orothersimilarlaws,wecouldbesubjecttobothcivilandcriminalpenalties,includingsubstantialfines,possibleincarcerationforemployeesandmanagersforwillfulviolations,andthepossiblelossofourexportorimportprivileges.Obtainingthenecessaryexportlicenseforaparticularsaleorofferingmaynotbepossibleandmaybetime‑consumingandmayresultinthedelayorlossofsalesopportunities.Furthermore,U.S.exportcontrollawsandeconomicsanctionsprohibittheexportofproductstocertainU.S.embargoedorsanctionedcountries,governmentsandpersons,aswellasforprohibitedend‑uses.MonitoringandensuringcompliancewiththesecomplexU.S.exportcontrollawsisparticularlychallengingbecauseourplatformandrelatedservicesarewidelydistributedthroughouttheworldandareavailablefordownloadwithoutregistration.Eventhoughwetakeprecautionstoensurethatweandourresellerpartnerscomplywithallrelevantexportcontrollawsandregulations,anyfailurebyusorourresellerpartnerstocomplywithsuchlawsandregulationscouldhavenegativeconsequencesforus,includingreputationalharm,governmentinvestigationsandpenalties.

Inaddition,variouscountriesregulatetheimportofcertainencryptiontechnology,includingthroughimportpermitandlicenserequirements,andhaveenactedlawsthatcouldlimitourabilitytodistributeourplatformorcouldlimitourend‑customers’abilitytoimplementourproductsinthosecountries.Changesinourproductsorchangesinexportandimportregulationsinsuchcountriesmaycreatedelaysintheintroductionofourplatformintointernationalmarkets,preventourend‑customerswithinternationaloperationsfromdeployingourproductsgloballyor,insomecases,preventordelaytheexportorimportofourplatformtocertaincountries,governmentsorpersonsaltogether.Anychangeinexportorimportlawsorregulations,economicsanctionsorrelatedlegislation,shiftinthe

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enforcementorscopeofexistingexport,importorsanctionslawsorregulations,orchangeinthecountries,governments,persons,ortechnologiestargetedbysuchexport,importorsanctionslawsorregulations,couldresultindecreaseduseofourplatformby,orinourdecreasedabilitytoexportorsellourplatformto,existingorpotentialend‑customerswithinternationaloperations.Anydecreaseduseofourplatformorlimitationonourabilitytoexporttoorsellourplatformininternationalmarketscouldadverselyaffectourbusiness,financialconditionandoperatingresults.

We are exposed to fluctuations in currency exchange rates, which could negatively affect our operating results.

OursalescontractsareprimarilydenominatedinU.S.dollars,andthereforesubstantiallyallofourrevenueisnotsubjecttoforeigncurrencyrisk.However,astrengtheningoftheU.S.dollarcouldincreasetherealcostofourplatformtoourcustomersoutsideoftheUnitedStates,whichcouldadverselyaffectouroperatingresults.Inaddition,anincreasingportionofouroperatingexpensesisincurredandanincreasingportionofourassetsisheldoutsidetheUnitedStates.Theseoperatingexpensesandassetsaredenominatedinforeigncurrenciesandaresubjecttofluctuationsduetochangesinforeigncurrencyexchangerates.Ifwearenotabletosuccessfullyhedgeagainsttherisksassociatedwithcurrencyfluctuations,ouroperatingresultscouldbeadverselyaffected.

Our failure to raise additional capital could reduce our ability to compete and could harm our business.

Weexpectthatourexistingcashandcashequivalents,togetherwithournetproceedsfromthisoffering,willbesufficienttomeetouranticipatedcashneedsfortheforeseeablefuture.Howeverifwechangeourbusinessstrategy,wemayneedtoraiseadditionalfundsinthefuture,andwemaynotbeabletoobtainadditionaldebtorequityfinancingonfavorableterms,ifatall.Ifweraiseadditionalequityfinancing,ourstockholdersmayexperiencesignificantdilutionoftheirownershipinterestsandthepersharevalueofourcommonstockcoulddecline.Furthermore,ifweengageindebtfinancing,theholdersofdebtwouldhavepriorityovertheholdersofcommonstock,andwemayberequiredtoaccepttermsthatrestrictourabilitytoincuradditionalindebtedness.Wemayalsoberequiredtotakeotheractionsthatwouldotherwisebeintheinterestsofthedebtholdersandforceustomaintainspecifiedliquidityorotherratios,anyofwhichcouldharmourbusiness,operatingresultsandfinancialcondition.

We are exposed to the credit risk of some of our resellers and customers and to credit exposure in weakened markets, which could result in material losses.

Mostofoursalesareonanunsecuredbasis.Althoughweseektomitigatetheserisks,wecannotbecertainthattheseeffortswillbeeffectiveinreducingourcreditrisks,especiallyasweexpandourbusinessinternationally.Ifweareunabletoadequatelycontroltheserisks,ourbusiness,resultsofoperationsandfinancialconditioncouldbeharmed.

Federal, state, foreign government and industry regulations, as well as self‑‑regulation related to privacy and data security concerns, pose the threat of lawsuitsand other liability.

Wecollectandutilizedemographicandotherinformation,includingpersonallyidentifiableinformation,fromandaboutouremployeesandourexistingandpotentialcustomersandpartners.Suchinformationmaybecollectedfromourcustomersandpartnerswhentheyvisitourwebsiteorthroughtheiruseofourproductsandinteractionswithourcompanyandemployeessuchaswhensigningupforcertainservices,registeringfortrainingseminars,participatinginasurvey,participatinginpollsorsigninguptoreceivee‑mailnewsletters.

Awidevarietyofdomesticandinternationallawsandregulationsapplytothecollection,use,retention,protection,disclosure,transferandotherprocessingofpersonaldata.Thesedataprotectionandprivacy‑relatedlawsandregulationsareevolvingandmayresultinregulatoryandpublicscrutinyandescalatinglevelsofenforcementandsanctions.Ourfailuretocomplywithapplicablelawsandregulations,ortoprotectsuchdata,couldresultinenforcementactionagainstus,includingfines,claimsfordamagesbycustomersandotheraffectedindividuals,damagetoourreputationandlossofgoodwill(bothinrelationtoexistingcustomersandprospectivecustomers),anyofwhichcouldhaveamaterialadverseeffectonouroperations,financialperformanceandbusiness.EvolvingandchangingdefinitionsofpersonaldataandpersonalinformationwithintheEuropeanUnion,theUnitedStates,andelsewheremaylimitorinhibitourabilitytooperateorexpandourbusiness.Eventheperceptionofprivacy

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concerns,whetherornotvalid,mayharmourreputation,inhibitadoptionofourproductsbycurrentandfuturecustomersoradverselyimpactourabilitytoattractandretainworkforcetalent.

Loss,retentionormisuseofcertaininformationandallegedviolationsoflawsandregulationsrelatingtoprivacyanddatasecurity,andanyrelevantclaims,mayexposeustopotentialliabilityandmayrequireustoexpendsignificantresourcesondatasecurityandinrespondingtoanddefendingsuchallegationsandclaims.Inaddition,futurelaws,regulations,standardsandotherobligations,andchangesintheinterpretationofexistinglaws,regulations,standardsandotherobligationscouldimpairourcustomers’abilitytocollect,useordisclosedatarelatingtoindividuals,whichcoulddecreasedemandforourplatform,increaseourcostsandimpairourabilitytomaintainandgrowourcustomerbaseandincreaseourrevenue.

A portion of our revenue is generated by sales to government entities and heavily regulated organizations, which are subject to a number of challenges andrisks.

Aportionofoursalesaretogovernmentalentities.Additionally,manyofourcurrentandprospectivecustomers,suchasthoseinthefinancialservicesandhealthcareindustries,arehighlyregulatedandmayberequiredtocomplywithmorestringentregulationsinconnectionwithsubscribingtoanddeployingourplatform.Sellingtotheseentitiescanbehighlycompetitive,expensiveandtimeconsuming,oftenrequiringsignificantupfronttimeandexpensewithoutanyassurancethattheseeffortswillresultinasale.Governmentandhighlyregulatedentitiesoftenrequirecontracttermsthatdifferfromourstandardarrangementsandimposecompliancerequirementsthatarecomplicated,requirepreferentialpricingor“mostfavorednation”termsandconditions,orareotherwisetimeconsumingandexpensivetosatisfy.Ifweundertaketomeetspecialstandardsorrequirementsanddonotmeetthem,wecouldbesubjecttoincreasedliabilityfromourcustomersorregulators.Evenifwedomeetthem,theadditionalcostsassociatedwithprovidingourservicestogovernmentandhighlyregulatedcustomerscouldharmourmargins.Moreover,changesintheunderlyingregulatoryconditionsthataffectthesetypesofcustomerscouldharmourabilitytoefficientlyprovideourservicestothemandtogrowormaintainourcustomerbase.

Additionally,governmentcertificationrequirementsforplatformslikeoursmaychangeandindoingsorestrictourabilitytosellintocertaingovernmentsectorsuntilwehaveattainedtherevisedcertification.Governmentdemandandpaymentforoursolutionsmaybeimpactedbypublicsectorbudgetarycyclesandfundingauthorizations,withfundingreductionsordelaysadverselyaffectingpublicsectordemandforoursolutions.Additionally,governmententitiesroutinelyinvestigateandauditgovernmentcontractors’administrativeprocesses,andanyunfavorableauditcouldresultinthegovernmententityrefusingtocontinuebuyingoursolutions,areductionofrevenue,finesorcivilorcriminalliabilityiftheaudituncoversimproperorillegalactivities,whichcouldadverselyimpactouroperatingresults.Furthermore,engaginginsalesactivitiestoforeigngovernmentsintroducesadditionalcompliancerisksspecifictotheFCPA,theUKBriberyActandothersimilarstatutoryrequirementsprohibitingbriberyandcorruptioninthejurisdictionsinwhichweoperate.

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain executivemanagement and qualified board members.

Asapubliccompany,wearesubjecttothereportingrequirementsoftheSecuritiesExchangeActof1934,ortheExchangeAct,theSarbanes‑OxleyActof2002,ortheSarbanes‑OxleyAct,theDodd‑FrankWallStreetReformandConsumerProtectionActof2010,ortheDodd‑FrankAct,therulesandregulationsofthelistingstandardsoftheNewYorkStockExchangeandotherapplicablesecuritiesrulesandregulations.Compliancewiththeserulesandregulationsincreasesourlegalandfinancialcompliancecosts,makessomeactivitiesmoredifficult,time‑consumingorcostlyandincreasesdemandonoursystemsandresources,particularlyafterwearenolongeran“emerginggrowthcompany.”TheExchangeActrequires,amongotherthings,thatwefileannual,quarterlyandcurrentreportswithrespecttoourbusinessandoperatingresults.TheSarbanes‑OxleyActrequires,amongotherthings,thatwemaintaineffectivedisclosurecontrolsandproceduresandinternalcontroloverfinancialreporting.Inordertomaintainand,ifrequired,improveourdisclosurecontrolsandproceduresandinternalcontroloverfinancialreportingtomeetthisstandard,significantresourcesandmanagementoversightmayberequired.Asaresult,management'sattentionmaybedivertedfromotherbusinessconcerns,whichcouldadverselyaffectourbusinessandoperatingresults.Althoughwehavealreadyhiredadditionalemployeestocomplywiththeserequirements,we

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mayneedtohiremoreemployeesinthefutureorengageoutsideconsultants,whichwillincreaseourcostsandexpenses.

Inaddition,changinglaws,regulationsandstandardsrelatingtocorporategovernanceandpublicdisclosurearecreatinguncertaintyforpubliccompanies,increasinglegalandfinancialcompliancecostsandmakingsomeactivitiesmoretimeconsuming.Theselaws,regulationsandstandardsaresubjecttovaryinginterpretations,inmanycasesduetotheirlackofspecificity,and,asaresult,theirapplicationinpracticemayevolveovertimeasnewguidanceisprovidedbyregulatoryandgoverningbodies.Thiscouldresultincontinuinguncertaintyregardingcompliancemattersandhighercostsnecessitatedbyongoingrevisionstodisclosureandgovernancepractices.Weintendtoinvestresourcestocomplywithevolvinglaws,regulationsandstandards,andthisinvestmentmayresultinincreasedgeneralandadministrativeexpensesandadiversionofmanagement'stimeandattentionfromrevenue‑generatingactivitiestocomplianceactivities.Ifoureffortstocomplywithnewlaws,regulationsandstandardsdifferfromtheactivitiesintendedbyregulatoryorgoverningbodiesduetoambiguitiesrelatedtotheirapplicationandpractice,regulatoryauthoritiesmayinitiatelegalproceedingsagainstusandourbusinessmaybeadverselyaffected.

However,foraslongasweremainan“emerginggrowthcompany”asdefinedintheJumpstartourBusinessStartupsActof2012,ortheJOBSAct,wemaytakeadvantageofcertainexemptionsfromvariousreportingrequirementsthatareapplicabletootherpubliccompaniesthatarenot“emerginggrowthcompanies”including,butnotlimitedto,notbeingrequiredtocomplywiththeauditorattestationrequirementsofSection404oftheSarbanes‑OxleyAct,reduceddisclosureobligationsregardingexecutivecompensationinourperiodicreportsandproxystatementsandexemptionsfromtherequirementsofholdinganonbindingadvisoryvoteonexecutivecompensationandstockholderapprovalofanygoldenparachutepaymentsnotpreviouslyapproved.Wemaytakeadvantageofthesereportingexemptionsuntilwearenolongeran“emerginggrowthcompany.”

Further,theJOBSActexemptsemerginggrowthcompaniesfrombeingrequiredtocomplywithneworrevisedfinancialaccountingstandardsuntilprivatecompanies(thatis,thosethathavenothadaSecuritiesActof1933,asamended,orSecuritiesAct,registrationstatementdeclaredeffectiveordonothaveaclassofsecuritiesregisteredundertheExchangeAct)arerequiredtocomplywiththeneworrevisedfinancialaccountingstandards.TheJOBSActprovidesthatacompanycanelecttooptoutoftheextendedtransitionperiodandcomplywiththerequirementsthatapplytonon‑emerginggrowthcompaniesbutanysuchelectiontooptoutisirrevocable.Wehaveelectednottooptoutofsuchextendedtransitionperiodwhichmeansthatwhenastandardisissuedorrevisedandithasdifferentapplicationdatesforpublicorprivatecompanies,we,asanemerginggrowthcompany,canadopttheneworrevisedstandardatthetimeprivatecompaniesadopttheneworrevisedstandard.Thismaymakecomparisonofourfinancialstatementswithanotherpubliccompanywhichisneitheranemerginggrowthcompanynoranemerginggrowthcompanywhichhasoptedoutofusingtheextendedtransitionperioddifficultbecauseofthepotentialdifferencesinaccountingstandardsused.

Wewillremainan“emerginggrowthcompany”foruptofiveyears.However,amongotherfactors,ifthemarketvalueofourcommonstockthatisheldbynon‑affiliatesexceeds$700millionasofanyJuly31afterourfirstannualreport,wewouldceasetobean“emerginggrowthcompany”asofthefollowingJanuary31.

Thesenewrulesandregulationswillmakeitmoreexpensiveforus,asapubliccompany,toobtaindirectorandofficerliabilityinsurance,andwemayberequiredtoacceptreducedcoverageorincursubstantiallyhighercoststoobtaincoverage.Thesefactorscouldalsomakeitmoredifficultforustoattractandretainqualifiedmembersofourboardofdirectors,particularlytoserveonourauditcommitteeandcompensationcommittee,andqualifiedexecutiveofficers.

Asaresultofdisclosureofinformationinthisprospectusandinfilingsrequiredofapubliccompany,ourbusinessandfinancialconditionaremorevisible,whichwebelievemayresultinthreatenedoractuallitigation,includingbycompetitorsandotherthirdparties.Ifsuchclaimsaresuccessful,ourbusinessandoperatingresultscouldbeadverselyaffected,andeveniftheclaimsdonotresultinlitigationorareresolvedinourfavor,theseclaims,andthetimeandresourcesnecessarytoresolvethem,coulddiverttheresourcesofourmanagementandadverselyaffectourbusinessandoperatingresults.

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If we fail to maintain an effective system of internal controls, our ability to produce timely and accurate financial statements or comply with applicableregulations could be impaired.

Asapubliccompany,wearesubjecttothereportingrequirementsoftheExchangeAct,theSarbanes‑OxleyAct,andtherulesandregulationsofthelistingstandardsoftheNewYorkStockExchange.Weexpectthattherequirementsoftheserulesandregulationswillcontinuetoincreaseourlegal,accounting,andfinancialcompliancecosts,makesomeactivitiesmoredifficult,time‑consuming,andcostly,andplacesignificantstrainonourpersonnel,systems,andresources.

TheSarbanes‑OxleyActrequires,amongotherthings,thatwemaintaineffectivedisclosurecontrolsandproceduresandinternalcontroloverfinancialreporting.WearecontinuingtodevelopandrefineourdisclosurecontrolsandotherproceduresthataredesignedtoensurethatinformationrequiredtobedisclosedbyusinthereportsthatwewillfilewiththeSecuritiesandExchangeCommission(SEC)isrecorded,processed,summarized,andreportedwithinthetimeperiodsspecifiedinSECrulesandformsandthatinformationrequiredtobedisclosedinreportsundertheExchangeActisaccumulatedandcommunicatedtoourprincipalexecutiveandfinancialofficers.Wearealsocontinuingtoimproveourinternalcontroloverfinancialreporting.Inordertomaintainandimprovetheeffectivenessofourdisclosurecontrolsandproceduresandinternalcontroloverfinancialreporting,wehaveexpended,andanticipatethatwewillcontinuetoexpend,significantresources,includingaccounting‑relatedcostsandsignificantmanagementoversight.

Ourcurrentcontrolsandanynewcontrolsthatwedevelopmaybecomeinadequatebecauseofchangesinconditionsinourbusiness.Further,weaknessesinourdisclosurecontrolsandinternalcontroloverfinancialreportingmaybediscoveredinthefuture.Anyfailuretodevelopormaintaineffectivecontrolsoranydifficultiesencounteredintheirimplementationorimprovementcouldharmouroperatingresultsorcauseustofailtomeetourreportingobligationsandmayresultinarestatementofourfinancialstatementsforpriorperiods.AnyfailuretoimplementandmaintaineffectiveinternalcontroloverfinancialreportingalsocouldadverselyaffecttheresultsofperiodicmanagementevaluationsandannualindependentregisteredpublicaccountingfirmattestationreportsregardingtheeffectivenessofourinternalcontroloverfinancialreportingthatwewilleventuallyberequiredtoincludeinourperiodicreportsthatwillbefiledwiththeSEC.Ineffectivedisclosurecontrolsandproceduresandinternalcontroloverfinancialreportingcouldalsocauseinvestorstoloseconfidenceinourreportedfinancialandotherinformation,whichcouldhaveanegativeeffectonthetradingpriceofourcommonstock.Inaddition,ifweareunabletocontinuetomeettheserequirements,wemaynotbeabletoremainlistedontheapplicablestockexchange.WearenotcurrentlyrequiredtocomplywiththeSECrulesthatimplementSection404oftheSarbanes‑OxleyActandarethereforenotrequiredtomakeaformalassessmentoftheeffectivenessofourinternalcontroloverfinancialreportingforthatpurpose.Asapubliccompany,wearerequiredtoprovideanannualmanagementreportontheeffectivenessofourinternalcontroloverfinancialreportingcommencingwithoursecondannualreportonForm10‑K.

Ourindependentregisteredpublicaccountingfirmisnotrequiredtoformallyattesttotheeffectivenessofourinternalcontroloverfinancialreportinguntilafterwearenolongeran“emerginggrowthcompany”asdefinedintheJOBSAct.Atsuchtime,ourindependentregisteredpublicaccountingfirmmayissueareportthatisadverseintheeventitisnotsatisfiedwiththelevelatwhichourinternalcontroloverfinancialreportingisdocumented,designed,oroperating.Anyfailuretomaintaineffectivedisclosurecontrolsandinternalcontroloverfinancialreportingcouldhaveamaterialandadverseeffectonourbusinessandoperatingresultsandcouldcauseadeclineinthepriceofourcommonstock.

We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will makeour common stock less attractive to investors.

Wearean“emerginggrowthcompany,”asdefinedintheJOBSAct,andweintendtotakeadvantageofcertainexemptionsfromvariousreportingrequirementsthatareapplicabletootherpubliccompaniesthatarenot“emerginggrowthcompanies,”includingnotbeingrequiredtocomplywiththeauditorattestationrequirementsofSection404oftheSarbanes‑OxleyAct,reduceddisclosureobligationsregardingexecutivecompensationinourperiodicreportsandproxystatements,exemptionsfromtherequirementsofholdinganonbindingadvisoryvoteonexecutivecompensationandstockholderapprovalofanygoldenparachutepaymentsnotpreviouslyapprovedandexemptions

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fromcomplyingwithneworrevisedfinancialaccountingstandardsuntilprivatecompaniesarerequiredtocomplywiththeneworrevisedaccountingstandards.Wemaytakeadvantageoftheseexemptionsforsolongaswearean“emerginggrowthcompany,”whichcouldbeaslongasfiveyearsfollowingtheeffectivenessofourinitialpublicofferingbutweexpecttonotbean“emerginggrowthcompany”sooner.Wecannotpredictifinvestorswillfindourcommonstocklessattractivebecausewewillrelyontheseexemptions.Ifsomeinvestorsfindourcommonstocklessattractiveasaresult,theremaybealessactivetradingmarketforourcommonstockandthepriceofourcommonstockmaybemorevolatile.

Our financial results may be adversely affected by changes in accounting principles applicable to us.

GenerallyacceptedaccountingprinciplesintheUnitedStates(GAAP)aresubjecttointerpretationbytheFinancialAccountingStandardsBoard(FASB),theSEC,andothervariousbodiesformedtopromulgateandinterpretappropriateaccountingprinciples.Forexample,inMay2014,theFASBissuedaccountingstandardsupdateNo.2014‑09(Topic606),RevenuefromContractswithCustomers,whichsupersedesnearlyallexistingrevenuerecognitionguidanceunderGAAP.Wewillberequiredtoimplementthisguidanceinfiscal2020.Wehavenotselectedatransitionmethodandcontinuetoevaluatewhateffect,ifany,theamendmentsandtransitionalternativescouldhaveonourfinancialpositionandresultsofoperations.Regardlessofthetransitionmethodselected,applicationofTopic606maysignificantlyimpacttheamountandtimingofrevenuerecognition,suchasrecognizingrevenuefromexistingcontractsinperiodsotherthanwhenhistoricallyreportedunderexistingGAAPortherevenuerecognizedunderexistingGAAPcouldbeeliminatedaspartoftheeffectofadoption.Further,adoptionofTopic606couldresultinchangestotheperiodswhenrevenueisrecognizedinthefuturecomparedwithmanagement’scurrentexpectationsunderexistingGAAP.Inaddition,Topic606maysignificantlychangethetimingofwhenexpenserecognitionwilloccurrelatedtocoststoobtainandfulfillcustomercontracts.WhiletheadoptionofTopic606doesnotchangethecashflowsreceivedfromourcontractswithcustomers,theadoptionofTopic606couldhaveamaterialadverseeffectonourfinancialpositionorresultsofoperations.

Changes in our provision for income taxes or adverse outcomes resulting from examination of our income tax returns could adversely affect our results.

WearesubjecttoincometaxationintheUnitedStatesandnumerousforeignjurisdictions.Determiningourprovisionforincometaxesrequiressignificantmanagementjudgment.Inaddition,ourprovisionforincometaxesissubjecttovolatilityandcouldbeadverselyaffectedbymanyfactors,including,amongotherthings,changestoouroperatingorholdingstructure,changesintheamountsofearningsinjurisdictionswithdifferingstatutorytaxrates,changesinthevaluationofdeferredtaxassetsandliabilitiesandchangesintaxlaws.Wecouldbesubjecttotaxexaminationsinvariousjurisdictions.Taxauthoritiesmaydisagreewithouruseofresearchanddevelopmenttaxcredits,intercompanycharges,cross‑jurisdictionaltransferpricingorothermattersandassessadditionaltaxes.Whileweregularlyassessthelikelyoutcomesoftheseexaminationstodeterminetheadequacyofourprovisionforincometaxes,therecanbenoassurancethattheoutcomesofsuchexaminationswillnothaveamaterialimpactonouroperatingresultsandcashflows.

Inaddition,wemaybesubjecttotheexaminationofourincometaxreturnsbytheU.S.InternalRevenueServiceandothertaxauthorities.Weregularlyassessthelikelihoodofadverseoutcomesresultingfromtheseexaminationstodeterminetheadequacyofourprovisionforincometaxes.Therecanbenoassurancethattheoutcomesfromthesecontinuousexaminationswillnothaveanadverseeffectonourresultsofoperations.

The enactment of legislation implementing changes in the United States of taxation of international business activities or the adoption of other tax reformpolicies could materially impact our financial position and results of operations.

RecentchangestoUnitedStatestaxlaws,includinglimitationsontheabilityoftaxpayerstoclaimandutilizeforeigntaxcreditsandthedeferralofcertaintaxdeductionsuntilearningsoutsideoftheUnitedStatesarerepatriatedtotheUnitedStates,aswellaschangestoUnitedStatestaxlawsthatmaybeenactedinthefuture,couldimpactthetaxtreatmentofourforeignearnings.Duetoexpansionofourinternationalbusinessactivities,anychangesintheUnitedStatestaxationofsuchactivitiesmayincreaseourworldwideeffectivetaxrateandadverselyaffectourfinancialpositionandresultsofoperations.

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Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations.

Ingeneral,underSection382oftheUnitedStatesInternalRevenueCodeof1986,asamended,ortheCode,acorporationthatundergoesan“ownershipchange”issubjecttolimitationsonitsabilitytoutilizeitspre‑changenetoperatinglosses(NOLs)tooffsetfuturetaxableincome.IfourexistingNOLsaresubjecttolimitationsarisingfrompreviousownershipchanges,ourabilitytoutilizeNOLscouldbelimitedbySection382oftheCode.Forexample,werecentlyperformedananalysistodeterminewhetheranownershipchangehadoccurredsinceourinceptionwhichidentifiedtwohistoricalownershipchanges.WhiletheselimitationsdidnotresultinamaterialrestrictionontheuseofourNOLs,futurechangesinourstockownership,someofwhichareoutsideofourcontrol,couldresultinanownershipchangeunderSection382oftheCode.Furthermore,ourabilitytoutilizeNOLsofcompaniesthatwemayacquireinthefuturemaybesubjecttolimitations.Thereisalsoariskthatduetoregulatorychanges,suchassuspensionsontheuseofNOLs,orotherunforeseenreasons,ourexistingNOLscouldexpireorotherwisebeunavailabletooffsetfutureincometaxliabilities.Forthesereasons,wemaynotbeabletoutilizeaportionoftheNOLsreflectedonourbalancesheet,evenifweattainprofitability.

We have business and customer relationships with certain entities who are stockholders or are affiliated with our directors, or both, and conflicts of interestmay arise because of such relationships.

Someofourcustomersandotherbusinesspartnersareaffiliatedwithcertainofourdirectorsorholdsharesofourcapitalstock,orboth.Forexample,wehaveenteredintostrategicrelationshipsand/orcustomerrelationshipswithIntelCorporation,orIntel.Ourformerdirector,KimStevenson,whoresignedinFebruary2017,wasanemployeeofIntel,andIntelisastockholder.Webelievethatthetransactionsandagreementsthatwehaveenteredintowithrelatedpartiesareontermsthatareatleastasfavorableascouldreasonablyhavebeenobtainedatsuchtimefromthirdparties.However,theserelationshipscouldcreate,orappeartocreate,potentialconflictsofinterestwhenourboardofdirectorsisfacedwithdecisionsthatcouldhavedifferentimplicationsforusandtheseotherpartiesortheiraffiliates.Inaddition,conflictsofinterestmayarisebetweenusandtheseotherpartiesandtheiraffiliates.Theappearanceofconflicts,evenifsuchconflictsdonotmaterialize,mightadverselyaffectthepublic’sperceptionofus,aswellasourrelationshipwithothercompaniesandourabilitytoenterintonewrelationshipsinthefuture,includingwithcompetitorsofsuchrelatedparties,whichcouldharmourbusinessandresultsofoperations.

Adverse economic conditions may negatively impact our business.

Ourbusinessdependsontheoveralldemandforinformationtechnologyandontheeconomichealthofourcurrentandprospectivecustomers.AnysignificantweakeningoftheeconomyintheUnitedStatesorEuropeandoftheglobaleconomy,morelimitedavailabilityofcredit,areductioninbusinessconfidenceandactivity,decreasedgovernmentspending,economicuncertaintyandotherdifficultiesmayaffectoneormoreofthesectorsorcountriesinwhichwesellourapplications.Globaleconomicandpoliticaluncertaintymaycausesomeofourcustomersorpotentialcustomerstocurtailspending,andmayultimatelyresultinnewregulatoryandcostchallengestoourinternationaloperations.Inaddition,astrongdollarcouldreducedemandforourproductsincountrieswithrelativelyweakercurrencies.Theseadverseconditionscouldresultinreductionsinsalesofourapplications,longersalescycles,reductionsinsubscriptiondurationandvalue,sloweradoptionofnewtechnologiesandincreasedpricecompetition.Anyoftheseeventscouldhaveanadverseeffectonourbusiness,operatingresultsandfinancialposition.

Our business is subject to the risks of earthquakes, fire, power outages, floods and other catastrophic events, and to interruption by man‑‑made problems suchas terrorism.

Asignificantnaturaldisaster,suchasanearthquake,fireoraflood,orasignificantpoweroutagecouldhaveamaterialadverseimpactonourbusiness,financialconditionandresultsofoperations.OurcorporateheadquartersarelocatedinPaloAlto,California,inaregionknownforseismicactivity,andwehavesignificantofficesinSanFrancisco,NewYorkCityandAustinintheUnitedStatesandinternationallyinBudapest,LondonandSingapore.Further,ifanaturaldisasterorterroristeventoccursinaregionfromwhichwederiveasignificantportionofourrevenue,customersinthatregionmaydelayorforegopurchasesofourproducts,whichmaymateriallyandadverselyimpactourresultsofoperationsforaparticularperiod.Forexample,thewestcoastoftheUnitedStatescontainsactiveearthquakezonesandtheeasternseaboardissubjecttoseasonalhurricaneswhileNewYorkandthe

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UnitedKingdomhavesufferedsignificantterroristattacks.Additionally,werelyonournetworkandthird‑partyinfrastructureandenterpriseapplications,internaltechnologysystemsandourwebsiteforourdevelopment,marketing,finance,customersupport,operationalsupport,hostedservicesandsalesactivities.Intheeventofamajorearthquake,hurricaneorcatastrophiceventsuchasfire,powerloss,floods,telecommunicationsfailure,cyber‑attack,warorterroristattack,wemaybeunabletocontinueouroperationsandmayenduresysteminterruptions,reputationalharm,delaysinourdevelopmentofsolutions,lengthyinterruptionsinourservices,breachesofdatasecurityandlossofcriticaldata,allofwhichcouldhaveanadverseeffectonouroperatingresults.Alloftheaforementionedrisksmaybeaugmentedifthebusinesscontinuityplansforusandourserviceprovidersprovetobeinadequate.Totheextentthatanyoftheaboveresultsindelaysorcancellationsofcustomerorders,orthedelayinthedeploymentofourproducts,ourbusiness,financialconditionandresultsofoperationscouldbeadverselyaffected.

Risks Related to Ownership of Our Common Stock and this Offering

The stock price of our common stock has been, and may continue to be, volatile or may decline regardless of our operating performance, and you may not beable to resell your shares at or above the public offering price.

Themarketpriceforourcommonstockhasbeen,andmaycontinuetobe,volatile.SincesharesofourcommonstockweresoldinourinitialpublicofferinginApril2017atapriceof$15.00pershare,ourstockpricehasrangedfrom$15.00to$23.35,throughSeptember27,2017.Themarketpriceofourcommonstockmaycontinuetofluctuatesignificantlyinresponsetonumerousfactors,manyofwhicharebeyondourcontrol,includingthefactorsincludedinthisRiskFactorssectionaswellas:

• overallperformanceoftheequitymarkets;

• actualoranticipatedfluctuationsinouroperatingresultsornetrevenueexpansionrate;

• changesinthefinancialprojectionswemayprovidetothepublicorourfailuretomeettheseprojections;

• failureofsecuritiesanalyststoinitiateormaintaincoverageofus,changesinfinancialestimatesbyanysecuritiesanalystswhofollowourcompany,orourfailuretomeettheseestimatesortheexpectationsofinvestors,evenifwemeetourownprojections;

• recruitmentordepartureofkeypersonnel;

• theeconomyasawholeandmarketconditionsinourindustry;

• rumorsandmarketspeculationinvolvingusorothercompaniesinourindustry;

• announcementsbyusorourcompetitorsofsignificanttechnicalinnovations,acquisitions,strategicpartnerships,jointventures,orcapitalcommitments;

• actualoranticipateddevelopmentsinourbusinessorourcompetitors’businessesorthecompetitivelandscapegenerally;

• developmentsordisputesconcerningourintellectualpropertyorourofferings,orthird‑partyproprietaryrights;

• announcedorcompletedacquisitionsofbusinessesortechnologiesbyusorourcompetitors;

• changesinoperatingperformanceandstockmarketvaluationsofothertechnologycompaniesgenerally,orthoseinourindustryinparticular;

• changesinaccountingstandards,policies,guidelines,interpretationsorprinciples;

• newlawsorregulationsornewinterpretationsofexistinglawsorregulationsapplicabletoourbusiness;

• lawsuitsthreatenedorfiledagainstus;

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• othereventsorfactors,includingthoseresultingfromwar,incidentsofterrorism,orresponsestotheseevents;

• theexpirationofcontractuallock‑upormarketstandoffagreements;and

• salesofsharesofourcommonstockbyusorourstockholders.

Inaddition,thestockmarketshaveexperiencedextremepriceandvolumefluctuationsthathaveaffectedandcontinuetoaffectthemarketpricesofequitysecuritiesofmanycompanies.Stockpricesofmanycompanieshavefluctuatedinamannerunrelatedordisproportionatetotheoperatingperformanceofthosecompanies.Inthepast,stockholdershaveinstitutedsecuritiesclassactionlitigationfollowingperiodsofmarketvolatility.Ifweweretobecomeinvolvedinsecuritieslitigation,itcouldsubjectustosubstantialcosts,divertresourcesandtheattentionofmanagementfromourbusiness,andadverselyaffectourbusiness.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volumecould decline.

Thetradingmarketforourcommonstockdependsinpartontheresearchandreportsthatsecuritiesorindustryanalystspublishaboutusorourbusiness.Wedonothaveanycontrolovertheseanalysts.Ifoneormoreoftheanalystsinitiateresearchwithanunfavorableratingordowngradeourcommonstock,provideamorefavorablerecommendationaboutourcompetitors,publishinaccurateorunfavorableresearchaboutourbusinessorceasecoverageofusorfailtopublishreportsonusregularly,demandforourcommonstockcoulddecrease,whichmightcauseourcommonstockpriceandtradingvolumetodecline.

Our directors, executive officers and principal stockholders will continue to have substantial control over us after this offering, which could limit your abilityto influence the outcome of key transactions, including a change of control.

Ourdirectors,executiveofficersandourstockholderswhoowngreaterthan5%ofouroutstandingcommonstock,togetherwiththeiraffiliates,willbeneficiallyown,intheaggregate,approximately42.6%ofouroutstandingcommonstockafterthisoffering,basedonthenumbersharesoutstandingasofAugust31,2017.Asaresult,thesestockholders,ifactingtogether,willbeabletoinfluenceorcontrolmattersrequiringapprovalbyourstockholders,includingtheelectionofdirectorsandtheapprovalofmergers,acquisitionsorotherextraordinarytransactions.Inaddition,thesestockholders,actingtogether,wouldhavetheabilitytocontrolthemanagementandaffairsofourcompany.Theymayalsohaveintereststhatdifferfromyoursandmayvoteinawaywithwhichyoudisagreeandwhichmaybeadversetoyourinterests.Thisconcentrationofownershipmayhavetheeffectofdelaying,preventingordeterringachangeofcontrolofourcompany,coulddepriveourstockholdersofanopportunitytoreceiveapremiumfortheircommonstockaspartofasaleofourcompanyandmightultimatelyaffectthemarketpriceofourcommonstock.

Inaddition,Intelwillholdapproximately18.7%ofouroutstandingcommonstockafterthisoffering,basedonthenumbersharesoutstandingasofAugust31,2017.Assuch,Intelcouldhaveconsiderableinfluenceovermatterssuchasapprovingapotentialacquisitionofus.Intel’sinvestmentinandpositioninourcompanycouldalsodiscourageothersfrompursuinganypotentialacquisitionofus,whichcouldhavetheeffectofdeprivingtheholdersofourcommonstockoftheopportunitytoselltheirsharesatapremiumovertheprevailingmarketprice.

We have broad discretion in the use of the net proceeds that we receive in this offering.

Theprincipalpurposesofthisofferingaretoraisecapitaltoreplacecashusedforfundingtaxwithholdingobligationsweincurreduponthenetsettlementofequityawards,thesettlementandwithholdingofwhichwasconcurrentwiththisoffering,andtofacilitateanorderlydistributionofsharesforthesellingstockholdersinthisoffering,includingcertainemployeesforpurposessuchassatisfyinganyincome,employmentorsocialtaxwithholdingandremittanceobligationsinconnectionwiththevestingofrestrictedstockunits(RSUs)andotherpurposes.Wewillnotreceiveanyproceedsfromthesaleofsharesbythesellingstockholders.Accordingly,ourmanagementwillhavebroaddiscretionoverthespecificuseofthenetproceedsthatwereceiveinthisofferingandmightnotbeabletoobtainasignificantreturn,ifany,oninvestmentofthesenetproceeds.Investorsinthisoffering

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willneedtorelyuponthejudgmentofourmanagementwithrespecttotheuseofproceeds.Ifwedonotusethenetproceedsthatwereceiveinthisofferingeffectively,ourbusiness,operatingresultsandfinancialconditioncouldbeharmed.

Sales of substantial amounts of our common stock in the public markets, or the perception that they might occur, including when the lock-up or market stand-off period ends, could cause the market price of our common stock to decline.

Salesofasubstantialnumberofsharesofourcommonstockintothepublicmarket,particularlysalesbyourdirectors,executiveofficers,andprincipalstockholders,ortheperceptionthatthesesalesmightoccur,couldcausethemarketpriceofourcommonstocktodeclineandmaymakeitmoredifficultforyoutosellyourcommonstockatatimeandpricethatyoudeemappropriate.Basedon131,250,336sharesofourcommonstockoutstandingasofJuly31,2017,wewillhave139,289,042sharesofourcommonstockoutstandingafterthisoffering.

Substantiallyallofoursecuritiesoutstandingpriortothisofferingarecurrentlyrestrictedfromresaleasaresultoflock‑upandmarketstandoffagreements.Seethesectiontitled“SharesEligibleforFutureSale”foradditionalinformation.Inconnectionwithourinitialpublicoffering,we,allofourdirectorsandexecutiveofficers,andtheholdersofsubstantiallyallofouroutstandingequitysecuritiesagreed,subjecttocertainexceptions,nottooffer,sell,oragreetosell,directlyorindirectly,anysharesofcommonstockforaperiodof180daysfromthedateofourinitialpublicoffering.Inconnectionwiththisoffering,MorganStanley&Co.LLC,onbehalfoftheunderwriters,hasconsentedtothereleaseoftheselock-uprestrictionswithrespectto12,446,930sharesofcommonstocktobesoldinthisofferingbythesellingstockholders(including2,014,816sharesofcommonstockthatmaybesoldbycertainsellingstockholdersuponexerciseoftheunderwriters’optiontopurchaseadditionalshares),including7,116,150sharesbeneficiallyownedbyourdirectorsandexecutiveofficersortheiraffiliatedentities.Thereleasewilltakeeffectonthepricingofthisoffering.

Inaddition,inconnectionwiththisoffering,subjecttocertainexceptions,we,allofourdirectorsandexecutiveofficers,thesellingstockholdersandcertainotherholdersofourcommonstock,includingAccel,whichasofAugust31,2017beneficiallyowned18,409,144sharesofourcommonstock,GreylockPartners,whichasofAugust31,2017beneficiallyowned14,199,711sharesofourcommonstock,andIntel,whichasofAugust31,2017beneficiallyowned26,065,827sharesofourcommonstock,agreedthat,withoutthepriorwrittenconsentofMorganStanley&Co.LLConbehalfoftheunderwritersandsubjecttocertainexceptions,weandtheywillnotoffer,sell,oragreetosell,directlyorindirectly,anysharesofcommonstockuntil(i)withrespecttoalldirectors,Intel,andthesellingstockholdersexceptforAccelandGreylock,thecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017and(ii)withrespecttoourexecutiveofficersandAccelandGreylock,withrespecttothenumberofsharesofcommonstockequaltofiftypercentofthecommonstockheldbythemimmediatelybeforetheconsummationofthisoffering,lessanysharessoldinthisoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017andwithrespecttotheremainingfiftypercentofthecommonstockheldbythemimmediatelybeforetheconsummationofthisoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedJanuary31,2018.

Whentheapplicablelock-upandmarketstandoffperiodsdescribedaboveexpire,weandoursecurityholderssubjecttoalock-upagreementormarketstand-offagreementwillbeabletoselloursharesinthepublicmarket.Additionally,MorganStanley&Co.LLCmay,initsdiscretion,permitoursecurityholderstosellsharespriortotheexpirationoftherestrictiveprovisionscontainedinthelock‑upagreements.Sharesheldbydirectors,executiveofficers,andotheraffiliateswillalsobesubjecttovolumelimitationsunderRule144undertheSecuritiesActandvariousvestingagreements.

Inaddition,asofJuly31,2017,wehadoptionsoutstandingthat,iffullyexercised,wouldresultintheissuanceof22,211,442sharesofcommonstockandRSUsthat,iffullysettled,wouldresultintheissuanceof24,197,948sharesofcommonstock.SubsequenttoJuly31,2017throughSeptember27,2017,wealsograntedRSUssettleablefor1,251,206sharesofourcommonstockandstockoptionsexercisablefor8,100sharesofourcommonstockandissued358,206sharesofourcommonstockinconnectionwithstrategictransactions.AllofthesharesofcommonstockissuableupontheexerciseofstockoptionsorsettlementofRSUs,andthesharesreservedforfutureissuance

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underourequityincentiveplansareregisteredforpublicresaleundertheSecuritiesAct.Accordingly,theseshareswillbeabletobefreelysoldinthepublicmarketuponissuancesubjecttoexistinglock‑upormarketstandoffagreementsandapplicablevestingrequirements.

Immediatelyfollowingthisoffering,theholdersofapproximately73.0millionsharesofourcommonstockwillhaverights,subjecttosomeconditions,torequireustofileregistrationstatementsforthepublicresaleofthecommonstockissuableuponconversionofsuchsharesortoincludesuchsharesinregistrationstatementsthatwemayfileforusorotherstockholders.

Wemayalsoissueoursharesofcommonstockorsecuritiesconvertibleintosharesofourcommonstockfromtimetotimeinconnectionwithafinancing,acquisition,orinvestment,orotherwise.Anysuchissuancecouldresultinsubstantialdilutiontoourexistingstockholdersandcausethemarketpriceofourcommonstocktodecline.

We do not intend to pay dividends for the foreseeable future.

Wehaveneverdeclaredorpaidanycashdividendsonourcommonstockanddonotintendtopayanycashdividendsintheforeseeablefuture.Weanticipatethatwewillretainallofourfutureearningsforuseinthedevelopmentofourbusinessandforgeneralcorporatepurposes.Anydeterminationtopaydividendsinthefuturewillbeatthediscretionofourboardofdirectors.Accordingly,investorsmustrelyonsalesoftheircommonstockafterpriceappreciation,whichmayneveroccur,astheonlywaytorealizeanyfuturegainsontheirinvestments.

Defensive measures in our charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, moredifficult and may prevent attempts by our stockholders to replace or remove our current management.

Ouramendedandrestatedcertificateofincorporationandamendedandrestatedbylaws,whichwereapprovedbyourstockholderspriortoourinitialpublicoffering,containprovisionsthatcoulddelayorpreventachangeincontrolofourcompany.Theseprovisionscouldalsomakeitdifficultforstockholderstoelectdirectorswhoarenotnominatedbythecurrentmembersofourboardofdirectorsortakeothercorporateactions,includingeffectingchangesinourmanagement.Theseprovisionsinclude:

• aclassifiedboardofdirectorswiththree‑yearstaggeredterms,whichcoulddelaytheabilityofstockholderstochangethemembershipofamajorityofourboardofdirectors;

• theabilityofourboardofdirectorstoissuesharesofpreferredstockandtodeterminethepriceandothertermsofthoseshares,includingpreferencesandvotingrights,withoutstockholderapproval,whichcouldbeusedtosignificantlydilutetheownershipofahostileacquirer;

• theexclusiverightofourboardofdirectorstoelectadirectortofillavacancycreatedbytheexpansionofourboardofdirectorsortheresignation,deathorremovalofadirector,whichpreventsstockholdersfrombeingabletofillvacanciesonourboardofdirectors;

• aprohibitiononstockholderactionbywrittenconsent,whichforcesstockholderactiontobetakenatanannualorspecialmeetingofourstockholders;

• therequirementthataspecialmeetingofstockholdersmaybecalledonlybythechairmanofourboardofdirectors,ourchiefexecutiveofficer,ourleaddirector,oramajorityvoteofourboardofdirectors,whichcoulddelaytheabilityofourstockholderstoforceconsiderationofaproposalortotakeaction,includingtheremovalofdirectors;

• therequirementfortheaffirmativevoteofholdersofatleast662/3%ofthevotingpowerofallofthethenoutstandingsharesofthevotingstock,votingtogetherasasingleclass,toamendtheprovisionsofouramendedandrestatedcertificateofincorporationrelatingtotheissuanceofpreferredstockandmanagementofourbusinessorouramendedandrestatedbylaws,whichmayinhibittheabilityofanacquirertoeffectsuchamendmentstofacilitateanunsolicitedtakeoverattempt;

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• theabilityofourboardofdirectorstoamendthebylaws,whichmayallowourboardofdirectorstotakeadditionalactionstopreventanunsolicitedtakeoverandinhibittheabilityofanacquirertoamendthebylawstofacilitateanunsolicitedtakeoverattempt;

• therequirementthatinorderforastockholdertobeeligibletoproposeanominationorotherbusinesstobeconsideredatanannualmeetingofourstockholders,suchstockholdermusthavecontinuouslybeneficiallyownedatleast1%ofouroutstandingcommonstockforaperiodofoneyearbeforegivingsuchnotice,whichmaydiscourage,delayordeterstockholdersorapotentialacquirerfromconductingasolicitationofproxiestoelectthetheirownslateofdirectorsorotherwiseattemptingtoobtaincontrolofusorinfluenceoverourbusiness;and

• advancenoticeprocedureswithwhichstockholdersmustcomplyinordertonominatecandidatestoourboardofdirectorsortoproposematterstobeacteduponatastockholders’meeting,whichmaydiscourage,delayordeterstockholdersorapotentialacquirerfromconductingasolicitationofproxiestoelectthetheirownslateofdirectorsorotherwiseattemptingtoobtaincontrolofusorinfluenceoverourbusiness.

Inaddition,ourrestatedcertificateofincorporationprovidesthattheCourtofChanceryoftheStateofDelawareistheexclusiveforumfor:anyderivativeactionorproceedingbroughtonourbehalf;anyactionassertingabreachoffiduciaryduty;anyactionassertingaclaimagainstusarisingpursuanttotheDelawareGeneralCorporationLaw,ourrestatedcertificateofincorporation,orourrestatedbylaws;oranyactionassertingaclaimagainstusthatisgovernedbytheinternalaffairsdoctrine.Thischoiceofforumprovisionmaylimitastockholder’sabilitytobringaclaiminajudicialforumthatitfindsfavorablefordisputeswithusoranyofourdirectors,officers,orotheremployees,whichmaydiscouragelawsuitswithrespecttosuchclaims.Alternatively,ifacourtweretofindthechoiceofforumprovisioncontainedinourrestatedcertificateofincorporationtobeinapplicableorunenforceableinanaction,wemayincuradditionalcostsassociatedwithresolvingsuchactioninotherjurisdictions,whichcouldharmourbusiness,operatingresultsandfinancialcondition.

Inaddition,becauseweareincorporatedinDelaware,wearegovernedbytheprovisionsoftheanti‑takeoverprovisionsoftheDelawareGeneralCorporationLaw,whichmaydiscourage,delayorpreventachangeincontrolbyprohibitingusfromengaginginabusinesscombinationwithaninterestedstockholderforaperiodofthreeyearsafterthepersonbecomesaninterestedstockholder,evenifachangeofcontrolwouldbebeneficialtoourexistingstockholders.Althoughwebelievetheseprovisionscollectivelyprovideforanopportunitytoobtaingreatervalueforstockholdersbyrequiringpotentialacquirerstonegotiatewithourboardofdirectors,theywouldapplyevenifanofferrejectedbyourboardwasconsideredbeneficialbysomestockholders.Inaddition,theseprovisionsmayfrustrateorpreventanyattemptsbyourstockholderstoreplaceorremoveourcurrentmanagementbymakingitmoredifficultforstockholderstoreplacemembersofourboardofdirectors,whichisresponsibleforappointingthemembersofourmanagement.

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SPECIAL NOTE REGARDING FORWARD‑‑LOOKING STATEMENTS

Thisprospectuscontainsforward‑lookingstatements.Allstatementscontainedinthisprospectusotherthanstatementsofhistoricalfact,includingstatementsregardingourfutureresultsofoperations,financialposition,marketsizeandopportunity,ourbusinessstrategyandplans,thefactorsaffectingourperformanceandourobjectivesforfutureoperations,areforward‑lookingstatements.Thewords“believe,”“may,”“will,”“estimate,”“continue,”“anticipate,”“intend,”“could,”“would,”“expect,”“objective,”“plan,”“potential,”“seek,”“grow,”“target,”“if”andsimilarexpressionsareintendedtoidentifyforward‑lookingstatements.Wehavebasedtheseforward‑lookingstatementslargelyonourcurrentexpectationsandprojectionsaboutfutureeventsandtrendsthatwebelievemayaffectourfinancialcondition,resultsofoperations,businessstrategy,short‑termandlong‑termbusinessoperationsandobjectivesandfinancialneeds.Theseforward‑lookingstatementsaresubjecttoanumberofrisks,uncertaintiesandassumptions,includingthosedescribedinthe“RiskFactors.”Moreover,weoperateinaverycompetitiveandrapidlychangingenvironment.Newrisksemergefromtimetotime.Itisnotpossibleforourmanagementtopredictallrisks,norcanweassesstheimpactofallfactorsonourbusinessortheextenttowhichanyfactor,orcombinationoffactors,maycauseactualresultstodiffermateriallyfromthosecontainedinanyforward‑lookingstatementswemaymake.Inlightoftheserisks,uncertaintiesandassumptions,thefutureeventsandtrendsdiscussedinthisprospectusmaynotoccurandactualresultscoulddiffermateriallyandadverselyfromthoseanticipatedorimpliedintheforward‑lookingstatements.Forward‑lookingstatementscontainedinthisprospectusinclude,butarenotlimitedto,statementsabout:

• ourexpectationsregardingourresultsofoperations,financialconditionandcashflows;

• ourexpectationsregardingthedevelopmentandexpansionofourbusiness;

• ourabilitytosuccessfullyenternewmarketsandmanageourinternationalexpansion;

• ourabilitytoexpandourcustomerbase,renewsubscriptionsandexpandpenetrationofexistingcustomers;

• anticipatedtrendsandchallengesinourbusinessandinthemarketsinwhichweoperate;

• ourabilitytodevelopnewfeaturesandfunctionalitythatmeetmarketneedsandachievemarketacceptance;

• theanticipatedbenefitsassociatedwiththeuseofourplatform,includingrecentdevelopments;

• ourabilitytoretainandhirenecessaryemployeesandstaffouroperationsappropriately;

• thetimingandamountofcertainexpenses;

• ourabilitytomaintain,protectandenhanceourintellectualproperty;and

• worldwideeconomicconditionsandtheirimpactonenterprisesoftwarespending.

Wecautionyouthattheforegoinglistmaynotcontainalloftheforward‑lookingstatementsmadeinthisprospectus.Inaddition,inlightoftheserisksanduncertainties,themattersreferredtointheforward‑lookingstatementscontainedinthisprospectusmaynotoccur.

Youshouldnotrelyuponforward‑lookingstatementsaspredictionsoffutureevents.Theeventsandcircumstancesreflectedintheforward‑lookingstatementsmaynotbeachievedoroccur.Althoughwebelievethattheexpectationsreflectedintheforward‑lookingstatementsarereasonable,wecannotguaranteefutureresults,levelsofactivity,performanceorachievements.Weareundernodutytoupdateanyoftheseforward‑lookingstatementsafterthedateofthisprospectusortoconformthesestatementstoactualresultsorrevisedexpectations.

YoushouldreadthisprospectusandthedocumentsthatwereferenceinthisprospectusandhavefiledwiththeSecuritiesandExchangeCommissionasexhibitstotheregistrationstatementofwhichthisprospectusisapartwiththeunderstandingthatouractualfutureresults,levelsofactivity,performanceandeventsandcircumstancesmaybemateriallydifferentfromwhatweexpect.

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MARKET, INDUSTRY AND OTHER DATA

Introduction

Thisprospectuscontainsestimatesandinformationconcerningourindustry,ourbusiness,andthemarketforoursolutions,includingmarketposition,marketsizeandgrowthratesofthemarketsinwhichweparticipate,thatarebasedonindustrypublications,surveysandreports.Althoughwehavenotindependentlyverifiedtheaccuracyorcompletenessofthedatacontainedintheseindustrypublications,surveys,andreports,webelievethepublications,surveysandreportsaregenerallyreliable,althoughsuchinformationisinherentlysubjecttouncertaintiesandimprecise.Theindustryinwhichweoperateissubjecttoahighdegreeofuncertaintyandriskduetovarietyoffactors,includingthosedescribedinthe“RiskFactors.”Theseandotherfactorscouldcauseresultstodiffermateriallyfromthoseexpressedinthesepublicationsandreports.

Thesourceofcertainstatisticaldata,estimates,andforecastscontainedinthisprospectusarethefollowingindependentindustrypublicationsorreports:

• BlackDuckSoftwareandNorthBridge,2015FutureofOpenSourceSurvey,2015

• InternationalDataCorporation,WorldwideInternetofThingsForecastUpdate,May2016

• InternationalDataCorporation,WorldwideSemiannualSoftwareTracker,May2017

• InternationalDataCorporation,WorldwideSoftwareTrackerTaxonomy,August2016

Global 8000

Werefertothelargest8,000corporateenterprisesgloballyastheGlobal8000.ForpurposesofdefiningtheGlobal8000,thetop2,000enterprisesintheGlobal8000arebasedontheFORBESGlobal2000ranking.TheFORBESGlobal2000isanannualrankingofthetop2,000publiccompaniesintheworldbyForbesmagazine.Therankingisbasedonamixoffourmetrics:sales,profit,assetsandmarketvalue.TheremainderoftheGlobal8000constituentsisbasedonentitieslistedinData.comashavingthehighestannualrevenue,excludingthosethatarelistedintheFORBESGlobal2000.Data.comisaserviceofferedbysalesforce.com,inc.thatweusetocategorizecompaniesbyindustry.

Forpurposesofcustomercount,acustomerisdefinedasanentitywithauniqueFORBESGlobal2000orData.comidentifierandquarterlysubscriptionrevenueasofthemeasurementdate.TheGlobal8000customercountasofJanuary31,2017andJuly31,2017presentedelsewhereinthisprospectusisbasedontheGlobal8000constituentsasofMay1,2017.

WeperiodicallyupdatetheGlobal8000listbasedontheFORBESGlobal2000listandinformationfromData.com.TheFORBESGlobal2000isupdatedannuallyinthesecondquarterofthecalendaryear.CurrentandpriorperiodGlobal8000customercountsarebasedonthemostrecentFORBESGlobal2000listforcomparabilitypurposes.WesimilarlyupdatetheremainderoftheGlobal8000basedonData.cominformation.Data.comcontinuouslyupdatesthislistofentities,andtherelevantGlobal8000constituentsareobtainedandprocessedduringthethirdmonthofthepriorfiscalquarterandfinalizedonthefirstdayofthenewfiscalquarter.Ourcustomercountissubjecttoadjustmentsforacquisitions,spin‑offsandothermarketactivity.Wheretheseadjustmentsoccur,previouslydisclosednumbersofcustomersarerestatedtoallowforcomparability.Forexample,weaddaGlobal8000customerwhenaGlobal8000companythatisnotourcustomeracquiresacompanyinourexistingcustomerbasethatisnotaGlobal8000company.WhenweenterintoacontractwithaGlobal8000parentcompany,oranyofitsrelatedsubsidiaries,oranycombinationofentitieswithinaGlobal8000company,wecountonlyoneGlobal8000customer.WedonotcountfurtherpenetrationintoentitieswithinagivenGlobal8000customerasanewcustomerintheGlobal8000customercount.WemakeexceptionsforholdingcompaniesandotherorganizationsforwhichtheFORBESGlobal2000orData.comidentifierinourjudgmentdoesnotaccuratelyrepresenttheClouderacustomer.

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Forpurposesofdeterminingthetoptenenterprisesinvarioussectors,wegrouptheFORBESGlobal2000categoriesintoindustryverticals,includingasfollows:

Industry Vertical FORBES Global 2000 Categories

BanksMajorBanksRegionalBanks

HealthcareandLifeSciences

BiotechsHealthcareServicesMedicalEquipment&SuppliesPharmaceuticals

Technology

CommunicationsEquipmentComputerHardwareComputerServicesSemiconductorsSoftware&Programming

Telecommunications TelecommunicationServices

ForpurposesofdeterminingthetoptenenterprisesintheFORBESGlobal2000bankcategory,wehaveexcludedstate‑controlledbanks.

Public Sector Organization

Wedefine“publicsectororganization”toincludethevariousdepartments,agenciesandotherorganizationsoftheU.S.federal,stateandlocalgovernments,aswellassimilarorganizationsofforeigngovernmentsandsubdivisions.Wealsoincludebothpublicandprivateeducationalinstitutionsandschooldistrictsaspublicsectororganizations.Duetothevarietyofambiguities,judgmentsanddistinctionsthatcouldbemade,andthelackofawidelyacceptedstandard,inhowsuchcustomersarecounted,wecurrentlydonotincludepublicsectororganizationsinourGlobal8000customercount.

Net Expansion Rate

Wehaveprovidedananalysisofournetexpansionrate.Ourquarterlynetsubscriptionrevenueexpansionrateequals:

• thesubscriptionrevenueinagivenquarterfromendusercustomersthathadsubscriptionrevenueinthesamequarteroftheprioryear,

divided by

• thesubscriptionrevenueattributabletothatsamegroupofcustomersinthatpriorquarter.

Ournetexpansionrateequalsthesimplearithmeticaverageofourquarterlynetsubscriptionrevenueexpansionrateforthefourquartersendingwiththemostrecentlycompletedfiscalquarter.WehaveexcludedIntelfromourcalculationofnetexpansionrate,asitisarelatedparty.

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USE OF PROCEEDS

Weestimatethatournetproceedsfromthesaleofthesharesofcommonstockthatwearesellinginthisofferingwillbeapproximately$45.8million,basedonthepublicofferingpriceof$16.45pershare,afterdeductingtheunderwritingdiscountsandcommissionsandestimatedofferingexpensespayablebyus.Wewillnotreceiveanyproceedsfromthesaleofsharesofourcommonstockbythesellingstockholders.

Theprincipalpurposesofthisofferingaretoraisecapitaltoreplacecashwewilluseforfundingtaxwithholdingobligationsweincurreduponthenetsettlementofequityawards,thesettlementandwithholdingofwhichwasconcurrentwiththepricingofthisoffering,andtofacilitateanorderlydistributionofsharesforthesellingstockholdersinthisoffering,includingcertainemployeesforpurposessuchassatisfyinganyincome,employmentorsocialtaxwithholdingandremittanceobligationsinconnectionwiththevestingandsettlementofrestrictedstockunits(RSUs)andotherpurposes.TofundthewithholdingandremittanceobligationsinconnectionwiththevestingandsettlementofRSUs,wearesellingcommonstockinthisofferinginanamountthatissubstantiallyequivalenttothenumberofsharesofcommonstockthatwewithholdinconnectionwiththesenetsettlements.Atotalof8,118,733sharesunderlyingRSUsnetsettledconcurrentwiththepricingofthisoffering,whichincludesthecancellationandforfeitureof3,080,027shareswithheldand5,038,706sharesissuedsubjecttothesettlementofRSUs.Basedontheapplicableincometaxrateforcertainofouremployeesfromwhomwewillwithholdtaxes,wewillpayapproximately$51.3milliontosatisfythesetaxwithholdingobligations.

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MARKET PRICE OF OUR COMMON STOCK

OurcommonstockhasbeenlistedontheNewYorkStockExchangeunderthesymbol“CLDR”sinceApril28,2017.Priortothatdate,therewasnopublictradingmarketforourcommonstock.ThefollowingtablesetsforthfortheperiodsindicatedthehighandlowsalepricespershareofourcommonstockasreportedontheNewYorkStockExchange:

High Low

Fiscal Year 2018 FirstFiscalQuarter(fromApril28,2017) $19.33 $17.73SecondFiscalQuarter(endedJuly31,2017) 23.35 15.40ThirdFiscalQuarter(throughSeptember27,2017) 22.40 16.06

OnSeptember27,2017,thelastreportedsalepriceofourcommonstockontheNewYorkStockExchangewas$16.59pershare.AsofJuly31,2017,wehad822holdersofrecordofourcommonstock.Theactualnumberofstockholdersisgreaterthanthisnumberofrecordholdersandincludesstockholderswhoarebeneficialownersbutwhosesharesareheldinstreetnamebybrokersandothernominees.

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DIVIDEND POLICY

Wehaveneverdeclaredorpaidanycashdividendsonourcapitalstock,andwedonotcurrentlyintendtopayanycashdividendsaftertheofferingorfortheforeseeablefuture.Weexpecttoretainfutureearnings,ifany,tofundthedevelopmentandgrowthofourbusiness.Anyfuturedeterminationtopaydividendsonourcommonstockwillbeatthediscretionofourboardofdirectorsandwilldependupon,amongotherfactors,ourfinancialcondition,operatingresults,currentandanticipatedcashneeds,plansforexpansionandotherfactorsthatourboardofdirectorsmaydeemrelevant.

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CAPITALIZATION

Thefollowingtablesetsforthourcash,cashequivalents,andmarketablesecuritiesandcapitalizationasofJuly31,2017onan:

• actualbasis;and

• asadjustedbasistogiveeffectto(i)thesaleandissuanceof3,000,000sharesofourcommonstockbyusinthisoffering,baseduponthereceiptbyusoftheestimatednetproceedsfromthisofferingatthepublicofferingpriceof$16.45pershare,andafterdeductingtheunderwritingdiscountsandcommissionsandestimatedofferingexpensespayablebyusandtheapplicationofthenetproceedsfromthisofferingasdescribedin“UseofProceeds,”and(ii)theissuanceof5,038,706sharesofcommonstocksubjecttothesettlementofrestrictedstockunits(RSUs),thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttothecancellationandforfeitureof3,080,027shareswithheldtosatisfytheassociatedwithholdingtaxobligations.

Youshouldreadthisinformationtogetherwithourconsolidatedfinancialstatementsandrelatednotesappearingelsewhereinthisprospectusandtheinformationsetforthin“SelectedConsolidatedFinancialData”and“Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations.”

July 31, 2017

Actual As Adjusted (in thousands, except share and per share data)Cash,cashequivalentsandmarketablesecurities $475,752 $470,180Stockholders’equity: Preferredstock,$0.00005parvaluepershare;20,000,000sharesauthorized,nosharesissuedandoutstanding,

actualandasadjusted — —Commonstock,$0.00005parvaluepershare,1,200,000,000sharesauthorized,131,250,336sharesissuedand

outstanding,actual;1,200,000,000sharesauthorized,139,289,042sharesissuedandoutstanding,asadjusted 7 7

Additionalpaid‑incapital 1,318,447 1,312,875Accumulatedothercomprehensiveloss (521) (521)Accumulateddeficit (962,545) (962,545)

Totalstockholders’equity 355,388 349,816

Totalcapitalization $355,388 $349,816

Thenumberofsharesofourcommonstockissuedandoutstandinginthetableabovedoesnotincludethefollowingshares:

• 22,211,442sharesofourcommonstockissuableupontheexerciseofstockoptionsoutstandingasofJuly31,2017,withaweighted‑averageexercisepriceof$4.73pershare;

• 24,197,948sharesofourcommonstocksubjecttorestrictedstockunits(RSUs)outstandingasofJuly31,2017;

• 1,251,206sharesofourcommonstocksubjecttoRSUsgrantedafterJuly31,2017throughSeptember27,2017;

• 8,100sharesofourcommonstockissuableupontheexerciseofstockoptionsgrantedafterJuly31,2017throughSeptember27,2017withanexercisepriceof$17.32pershare;

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• 358,206sharesofourcommonstockissuedinconnectionwithstrategictransactionsafterJuly31,2017throughSeptember27,2017;and

• 32,848,932sharesofourcommonstockreservedforfutureissuanceunderourequitycompensationplans,consistingof:

– 29,848,932sharesofourcommonstockreservedforfutureissuanceunderour2017EquityIncentivePlan,or2017Plan,asofJuly31,2017(whichnumberofsharesispriortotheRSUsandstockoptionsgrantedafterJuly31,2017);and

– 3,000,000sharesofourcommonstockreservedforfutureissuanceunderour2017ESPP.

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SELECTED CONSOLIDATED FINANCIAL DATA

TheselectedconsolidatedstatementofoperationsdatafortheyearsendedJanuary31,2016and2017,andtheselectedconsolidatedbalancesheetdataasofJanuary31,2016and2017,havebeenderivedfromourauditedconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.TheselectedconsolidatedstatementofoperationsdatafortheyearendedJanuary31,2015,andtheselectedconsolidatedbalancesheetdataasofJanuary31,2015,havebeenderivedfromourauditedconsolidatedfinancialstatementsthatarenotincludedinthisprospectus.TheselectedconsolidatedstatementofoperationsdataforthesixmonthsendedJuly31,2016and2017andtheselectedconsolidatedbalancesheetdataasofJuly31,2017havebeenderivedfromourunauditedinterimconsolidatedfinancialstatementsincludedelsewhereinthisprospectus.OurunauditedinterimconsolidatedfinancialstatementshavebeenpreparedinaccordancewithU.S.generallyacceptedaccountingprinciples,orU.S.GAAP,onthesamebasisasourauditedannualconsolidatedfinancialstatementsand,intheopinionofmanagement,reflectalladjustments,consistingonlyofnormal,recurringadjustments,thatarenecessaryforthefairstatementofourconsolidatedfinancialpositionasofJuly31,2017andourconsolidatedresultsofoperationsforthesixmonthsendedJuly31,2016and2017.Youshouldreadthefollowingselectedconsolidatedfinancialdatainconjunctionwithourconsolidatedfinancialstatementsandtheaccompanyingnotesandtheinformationin“Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations”containedelsewhereinthisprospectus.Ourhistoricalresultsarenotnecessarilyindicativeoftheresultsthatmaybeexpectedforanyotherperiodinthefuture,andtheresultsforthesixmonthsendedJuly31,2017arenotnecessarilyindicativeoftheresultstobeexpectedforthefullyearoranyotherperiod.

Year Ended January 31, Six Months Ended

July 31,

2015 2016 2017 2016 2017

(in thousands, except per share data)

Consolidated Statements of Operations Data: Revenue: Subscription $ 72,615 $ 119,150 $ 200,252 $ 91,360 $ 138,657

Services 36,503 46,898 60,774 29,581 30,767

Totalrevenue 109,118 166,048 261,026 120,941 169,424

Costofrevenue:(1)(2)(4) Subscription 18,314 30,865 38,704 19,057 41,687

Services 32,148 44,498 48,284 23,317 50,395

Totalcostofrevenue 50,462 75,363 86,988 42,374 92,082

Grossprofit 58,656 90,685 174,038 78,567 77,342

Operatingexpenses:(1)(2)(3)(4) Researchanddevelopment 66,431 99,314 102,309 51,150 138,675



Totaloperatingexpenses 195,208 295,322 361,377 160,870 365,367

Lossfromoperations (136,552) (204,637) (187,339) (82,303) (288,025)

Interestincome,net 327 2,218 2,756 1,448 2,089

Otherincome(expense),net (490) 386 (547) (15) 839

Netlossbeforebenefitfrom(provisionfor)incometaxes (136,715) (202,033) (185,130) (80,870) (285,097)

Benefitfrom(provisionfor)incometaxes 1,285 (1,110) (2,187) (970) (1,451)

Netloss (135,430) (203,143) (187,317) (81,840) (286,548)

Deemeddividendtopreferredstockholders (43,207) — — — —

Netlossattributabletocommonstockholders $ (178,637) $ (203,143) $ (187,317) $ (81,840) $ (286,548)

Netlosspershareattributabletocommonstockholders,basicanddiluted $ (6.53) $ (6.21) $ (5.15) $ (2.27) $ (3.28)

Weighted-averagesharesusedincomputingnetlosspershareattributabletocommonstockholders,basicanddiluted(5) 27,348 32,724 36,406 36,090 87,293

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July 31,

2015 2016 2017 2016 2017

(in thousands)


Costofrevenue–services 1,376 4,301 1,803 931 24,227




Totalstock-basedcompensationexpense $ 34,066 $ 63,590 $ 21,714 $ 11,241 $ 230,533



July 31,

2015 2016 2017 2016 2017

(in thousands)


Salesandmarketing 1,149 1,723 1,723 861 861

Totalamortizationofacquiredintangibleassets $ 2,055 $ 3,455 $ 3,720 $ 1,830 $ 1,885

(3) InJanuary2017,wedonated1,175,063sharesofcommonstocktotheClouderaFoundation.Werecordedanon‑cashchargeof$21.6millionforthefairvalueofthedonatedshares,whichwasrecognizedingeneralandadministrativeexpensefortheyearendedJanuary31,2017,seeNote12toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforfurtherdiscussion.

(4) OnApril27,2017,theeffectivedateofourinitialpublicoffering,theliquidityevent‑relatedperformanceconditionwasachievedforthemajorityofourRSUsandbecameprobableofbeingachievedfortheremainingRSUs.Werecognizedstock‑basedcompensationexpenseusingtheacceleratedattributionmethodwithacumulativecatch‑upofstock‑basedcompensationexpenseintheamountof$181.5millionduringthesixmonthsendedJuly31,2017,attributabletoservicepriortosucheffectivedate.SeeNote10toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforfurtherdiscussion.

(5) SeeNotes2and14toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforanexplanationofthecalculationsofourbasicanddilutednetlosspershareattributabletocommonstockholders,andtheweighted‑averagenumberofsharesusedinthecomputationofthepershareamounts.

As of

January 31, As of

July 31,

2015 2016 2017 2017 (in thousands)Consolidated Balance Sheet Data: Cashandcashequivalents $ 359,814 $ 35,966 $ 74,186 $ 68,936Marketablesecurities,currentandnoncurrent 138,448 362,279 181,480 406,816Workingcapital 387,096 142,717 110,616 248,492Totalassets 575,239 512,887 442,544 649,817Deferredrevenue,currentandnoncurrent 116,089 158,175 217,424 231,121Redeemableconvertiblepreferredstock 657,687 657,687 657,687 —Totalstockholders’equity(deficit) (222,640) (343,509) (483,756) 355,388

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Non‑‑GAAP Financial Measure

InadditiontoourresultsdeterminedinaccordancewithU.S.generallyacceptedaccountingprinciples(GAAP),webelievethefollowingnon‑GAAPfinancialmeasureisusefulinevaluatingouroperatingperformance.

Year Ended January 31,

Six Months Ended July 31,

2015 2016 2017 2016 2017 (in thousands)

Other Financial Statement Data:

Non‑GAAPoperatingloss $ (100,431) $ (137,592) $ (140,331) $ (69,232) $ (55,607)

Wedefinenon‑GAAPoperatinglossaslossfromoperationsbeforestock‑basedcompensationexpense,amortizationofacquiredintangibleassetsanddonationofcommonstocktotheClouderaFoundation.Webelievethatthisnon‑GAAPfinancialmeasure,whentakentogetherwiththecorrespondingGAAPfinancialmeasure,providesmeaningfulsupplementalinformationregardingourperformancebyexcludingcertainitemsthatmaynotbeindicativeofourbusiness,operatingresultsorfutureoutlook.Ourmanagementuses,andbelievesthatinvestorsbenefitfromreferringto,thisnon‑GAAPfinancialmeasureinevaluatingouroperatingresults,aswellaswhenplanning,forecasting,budgetingandanalyzingfutureperiods.Wealsousenon‑GAAPoperatinglossinconjunctionwithtraditionalGAAPmeasurestocommunicatewithourboardofdirectorsconcerningourfinancialperformance.

Webelievenon‑GAAPoperatinglossprovidesinvestorsandotherusersofourfinancialinformationconsistencyandcomparabilitywithourpastfinancialperformanceandfacilitatesperiodtoperiodcomparisonsofoperations.Webelievenon‑GAAPoperatinglossisusefulinevaluatingouroperatingperformancecomparedtothatofothercompaniesinourindustryasthismetricgenerallyeliminatestheeffectsofcertainitemsthatmayvaryfordifferentcompaniesforreasonsunrelatedtooveralloperatingperformance.Ourdefinitionmaydifferfromthedefinitionsusedbyothercompaniesandthereforecomparabilitymaybelimited.Inaddition,othercompaniesmaynotpublishthisorsimilarmetrics.Thus,ournon‑GAAPoperatinglossshouldbeconsideredinadditionto,notasasubstitutefororinisolationfrom,measurespreparedinaccordancewithGAAP.

Wecompensatefortheselimitationsbyprovidinginvestorsandotherusersofourfinancialinformationareconciliationofnon‑GAAPoperatinglosstolossfromoperations,therelatedGAAPfinancialmeasure.Weencourageinvestorsandotherstoreviewourfinancialinformationinitsentirety,nottorelyonanysinglefinancialmeasureandtoviewnon‑GAAPoperatinglossinconjunctionwithlossfromoperations.Thefollowingtableprovidesareconciliationoflossfromoperationstonon‑GAAPoperatingloss:



2015 2016 2017 2016 2017 (in thousands)

Lossfromoperations $ (136,552) $ (204,637) $ (187,339) $ (82,303) $ (288,025)

Stock‑basedcompensationexpense 34,066 63,590 21,714 11,241 230,533Amortizationofacquiredintangibleassets 2,055 3,455 3,720 1,830 1,885DonationofcommonstocktotheClouderaFoundation — — 21,574 — —

Non‑GAAPoperatingloss $ (100,431) $ (137,592) $ (140,331) $ (69,232) $ (55,607)

Forthereasonssetforthbelow,webelievethatexcludingthecomponentsdescribedbelowprovidesusefulinformationtoinvestorsandothersinunderstandingandevaluatingouroperatingresultsandfutureprospectsinthesamemanneraswedoandincomparingourfinancialresultsacrossaccountingperiodsandtofinancialresultsofpeercompanies.

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• Stock‑Based Compensation Expense. Weexcludestock‑basedcompensationexpensefromournon‑GAAPfinancialmeasureconsistentwithhowweevaluateouroperatingresultsandprepareouroperatingplans,forecastsandbudgets.Further,whenconsideringtheimpactofequityawardgrants,wefocusonoverallstockholderdilutionratherthantheaccountingchargesassociatedwithsuchequitygrants.Theexclusionoftheexpensefacilitatesthecomparisonofresultsandbusinessoutlookforfutureperiodswithresultsforpriorperiodsinordertobetterunderstandthelongtermperformanceofourbusiness.

• Amortization of Acquired Intangible Assets. Weexcludetheamortizationofacquiredintangibleassetsfromournon‑GAAPfinancialmeasure.Althoughthepurchaseaccountingforanacquisitionnecessarilyreflectstheaccountingvalueassignedtointangibleassets,ourmanagementteamexcludestheGAAPimpactofacquiredintangibleassetswhenevaluatingouroperatingresults.Likewise,ourmanagementteamexcludesamortizationofacquiredintangibleassetsfromouroperatingplans,forecastsandbudgets.Theexclusionoftheexpensefacilitatesthecomparisonofresultsandbusinessoutlookforfutureperiodswithresultsforpriorperiodsinordertobetterunderstandthelongtermperformanceofourbusiness.

• Donation of common stock to the Cloudera Foundation. Duringthefourthquarteroffiscal2017,weissued1,175,063sharesofcommonstocktotheClouderaFoundationfornoconsideration.Thisresultedinaone‑timenon‑cashchargeof$21.6million,whichwasrecordedingeneralandadministrativeexpensesontheconsolidatedstatementofoperations.OurmanagementteamdoesnotconsiderthisexpensewhenevaluatingouroperatingperformanceandwedonotexpecttomakefuturegrantsofsharestotheClouderaFoundationandthereforeconsiderthischargenon‑recurringandexcludetheGAAPimpactofthedonationwhenevaluatingouroperatingresults.Theexclusionoftheexpensefacilitatesthecomparisonofresultsandbusinessoutlookforfutureperiodswithresultsforpriorperiodsinordertobetterunderstandthelong‑termperformanceofourbusiness.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the section titled “SelectedConsolidated Financial Data” and the consolidated financial statements and related notes thereto included elsewhere in this prospectus. This discussion containsforward‑looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause orcontribute to such differences include, but are not limited to, those identified below and those discussed in the section titled “Risk Factors” included elsewhere inthis prospectus. Our fiscal year end is January 31, and references throughout this prospectus to a given fiscal year are to the twelve months ended on that date.

Overview

Clouderaempowersorganizationstobecomedata‑drivenenterprisesinthenewlyhyperconnectedworld.Wehavedevelopedthemodernplatformformachinelearningandanalytics,optimizedforthecloud.Wehaveachievedthispositionthroughextensivecollaborationwiththeglobalopensourcecommunity,continuousinnovationindatamanagementtechnologiesandbyleveragingthelatestadvancesininfrastructureincludingthepubliccloudfor“bigdata”applications.Ourpioneeringhybridopensourcesoftware(HOSS)modelincorporatesthebestofopensourcewithourrobustproprietarysoftwaretoformanenterprise‑gradeplatform.Thisplatformdeliversanintegratedsuiteofcapabilitiesfordatamanagement,machinelearningandadvancedanalytics,affordingcustomersanagile,scalableandcost‑effectivesolutionfortransformingtheirbusinesses.Offeredonasubscriptionbasis,ourplatformenablesorganizationstousevastamountsofdatafromavarietyofsources,includingtheInternetofThings(IoT),tobetterserveandmarkettotheircustomers,designconnectedproductsandservicesandreduceriskthroughgreaterinsightfromdata.Webelievethatoursolutionisthemostwidelyadoptedbigdataplatform,withagrowingrangeofapplicationsbeingbuiltonit.

Sinceourfounding,ourcollaborationwiththeopensourcecommunityandourproprietarysoftwareinnovationhaveenabledustogrowourtechnology,platformofferingsandcustomerbaserapidly.Thegraphicbelowprovidesanoutlineofselectedmilestones.

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Wefocusoursellingeffortsonthelargest8,000corporateenterprisesglobally(Global8000)aswellaslargepublicsectororganizations.Wetargettheseorganizationsbecausetheycaptureandmanagethemajorityoftheworld’sdataandoperatehighlycomplexITenvironments.Theseorganizationsarelikelytorealizethegreatestvaluefromutilizingourenterprise‑gradeplatform.See“Market,IndustryandOtherData”forhowwedefineGlobal8000.

Tomaintainourstrongpartnerecosystem,wewillcontinuetoestablishandmaintainrelationshipswiththirdparties.Todate,over2,800resellers,systemsintegrators,independentsoftwarevendorsandplatformandcloudprovidershaveregisteredunderourClouderaConnectpartnerprogramtogainaccesstomarketing,sales,trainingandsupportresources.WehavealsodevelopedastrategicpartnershipwithIntelCorporation,orIntel,tooptimizeoursoftwareforusewithIntelprocessorsandarchitecture.Asaresultofourjointdedicationtothispartnership,ourplatformachievesdifferentiatedperformanceonIntelarchitecturetoday,andisexpectedtoachievedifferentiatedperformanceonfutureIntelplatformtechnologies.

Wehaveachievedsignificantgrowthoverouroperatinghistory.ForourfiscalyearsendedJanuary31,2016andJanuary31,2017,ourrevenuewas$166.0millionand$261.0million,respectively,representingyear‑over‑yeargrowthinrevenueof57%forourmostrecentfiscalyear.Overthesameperiod,operatingcashoutflowsincreasedfrom$90.5millionto$116.6millionwhileournetlosseswere$203.1millionand$187.3million,respectively,whichincludes$63.6millionand$21.7million,respectively,ofstock‑basedcompensationexpense,andanon‑cashchargeof$21.6millioninconnectionwiththedonationofcommonstocktotheClouderaFoundationforfiscal2017.ForthesixmonthsendedJuly31,2016and2017,ourrevenuewas$120.9millionand$169.4millionrespectively,representingperiod‑over‑periodgrowthinrevenueof40%.Overthesameperiod,operatingcashoutflowsdecreasedfrom$52.1millionto$17.9millionwhileournetlosseswere$81.8millionand$286.5million,respectively,whichincludes$11.2millionand$230.5million,respectively,ofstock‑basedcompensationexpense.

Our Hybrid Open Source Software (HOSS) Business Model

Wehavecreatedoursoftwareplatformandpioneeredthehybridopensourcesoftwaremodel.HOSScombinesthebestopensourcesoftwarewithproprietarysoftwaretomeettheexactingrequirementsoflargeenterprises.Byintegratingrobustproprietarysoftwarewithouropensourceplatform,builtontheleadingdatamanagementandanalyticstechnologies,wedeliversubstantiallygreatervaluetocustomersinmanaging,operatingandsecuringtheirdataanddataarchitectures.Thisapproachalsocreatesmeaningfuldifferentiationthatdriveslong‑livedcustomerrelationships,aswellastherevenuetosupportsustainedinnovation.

Subscription Model

Weofferterm‑basedsubscriptionsofourplatformgenerallyonapernodebasis,whetherdeployedon‑premisesorinthecloud.Wealsoofferconsumption‑basedpricingforcloud‑baseddeployments,aswellaspricingonaperuserbasisinsomecases.AsofJuly31,2017,approximately21%ofourGlobal8000customersrunourplatforminthecloud.Wealsogeneraterevenuefromprofessionalservicesandtraining.

Weoffer subscriptions for five editions of our platform, ranging fromCloudera Essentials to the industry leading Cloudera Enterprise. Other editions aredesigned to address the most common and critical data challenges enterprises face: Cloudera Data Science and Engineering for programmatic preparation,predictive modelingandmachinelearning; Cloudera Operational DBfor online, streamingandreal‑timeapplications; andCloudera Analytics DBfor businessintelligenceandSQLanalytics.

Operating Model

Wemarketandsellourplatformtoabroadrangeoforganizations,althoughwefocusoursellingeffortsonlargeenterprises,primarilytheGlobal8000,aswellaslargepublicsectororganizations.Wetargettheseorganizationsbecausetheycaptureandmanagethevastmajorityoftheworld’sdataandoperatehighlycomplexITenvironments,andourenterprise‑gradeplatformhasthegreatestopportunitytobenefittheseorganizations.OurtotalnumberofGlobal8000customersgrewfrom500asofJanuary31,2017to562asofJuly31,2017.ForthefiscalyearendedJanuary31,2017andforthesixmonthsendedJuly31,2017,revenuefromourGlobal8000customersrepresented73%and74%oftotalrevenue,respectively,basedontheGlobal8000constituentsasofMay

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1,2017.Forfiscal2017andforthesixmonthsendedJuly31,2017,revenuefromourpublicsector,includinglargepublicsector,customersrepresented10%and9%oftotalrevenue,respectively.See“Market,IndustryandOtherData—Global8000.”

Wehaveabroadcustomerbasethatspansindustriesandgeographies.Forfiscal2016andfiscal2017andthesixmonthsendedJuly31,2017,nocustomeraccountedformorethan10%ofourtotalrevenue.Wehavesignificantrevenueinthebankingandfinancialservices,technology,businessservices,telecommunications,publicsector,consumerandretail,andhealthcareandlifesciencesverticals,andcontinuetoexpandourpenetrationacrossmanyotherdata‑intensiveindustries.Wehaveasubstantialandgrowinginternationalpresencewithmorethan25%ofourrevenuegeneratedoutsideoftheUnitedStatesinfiscal2017.

Wemarketourplatformprimarilythroughadirectsalesforcewhilebenefitingfrombusinessdrivenbyourecosystemoftechnologypartners,resellers,OEMs,MSPs,independentsoftwarevendorsandsystemsintegrators.Thesizeandgrowthofourpartnerecosystemaffordsusreachandgreaterdistributionofoursoftware,enhancingourfieldorganizations’efforts.Moreover,weworkcloselywithselectvendorstodesignsolutionstospecificallyaddresstheneedsofcertainindustryverticalsorusecases,whichwerefertoasPartnerSolutions.See“Business—PartnersandStrategicAlliances”and“Business—IntelStrategicPartnership.”

Ourbusinessmodelisbasedona“landandexpand”strategydesignedtousetheinitialsaleasafootholdtoincreaserevenuepercustomerbyincreasingtheamountofdataandnumberofusecaseseachcustomerrunsthroughourplatform.Afteraninitialpurchaseofourplatform,weworkwithourcustomerstoidentifynewusecasesthatcanbedevelopedonormovedtoourplatform,ultimatelyincreasingtheamountofdatamanagedonourplatformaswellasthenumberandsizeofourplatformdeployments.

Tofurtherillustratetheeconomicsofourcustomerrelationships,wehaveprovidedananalysisofournetexpansionrate.Ourquarterlynetsubscriptionrevenueexpansionrateequals:


divided by


Ournetexpansionrateequalsthesimplearithmeticaverageofourquarterlynetsubscriptionrevenueexpansionrateforthefourquartersendingwiththemostrecentlycompletedfiscalquarter.WehaveexcludedIntelfromourcalculationofnetexpansionrate,asitisarelatedparty.Ourexperiencehasbeenthatnetexpansionratesaregenerallyconsistentacrosscustomercohorts,irrespectiveoftheageofthecohort.Inparticular,ournetexpansionrateasofJuly31,2017was140%.

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Sinceourfounding,wehaveinvestedheavilytogrowourbusiness.Wehaveincreasedourheadcountfrom1,140employeesasofJanuary31,2016to1,470employeesasofJanuary31,2017to1,606employeesasofJuly31,2017.Wemakesignificantinvestmentsinresearchanddevelopment.Weexpendengineeringresourcestodriveinnovationintheopensourcecommunity,integratethelatestopensourcetechnologies,andcreateproprietarysoftwaretoconstantlyimprovethefunctionalityandperformanceofourplatform.Wemaketheseinvestmentstomeettheevolvingneedsofourcustomersandcapitalizeonthegrowingmarketfordatamanagement,machinelearningandanalyticssoftware.Weintendtocontinuethisinvestmentasweaimtoexpandourcategoryleadershipinopensourcedatamanagement.

Wealsoremaincommittedtoinvestinginoursalesandmarketingactivities,includingexpandingourstrategicpartnershipsandalliances,toacquirenewcustomersandincreasepenetrationamongexistingcustomers.Ourbusinessmodelfocusesonmaximizingthelifetimevalueofacustomerrelationship.Werecognizesubscriptionrevenueratablyoverthetermofthesubscriptionperiod,andrecognizeconsumption‑basedrevenueasprocessorhoursareconsumed.Ingeneral,customeracquisitioncostsandupfrontcostsassociatedwithnewcustomersarehigherinthefirstyearthantheaggregaterevenuewerecognizefromthosenewcustomersinthefirstyear.Overthelifetimeofthecustomerrelationship,wealsoincursalesandmarketingcoststoreneworincreaseusagepercustomer.However,thesecosts,asapercentageofrevenue,aresignificantlylessthanthoseinitiallyincurredtoacquirethecustomer.Asaresult,theprofitabilityofacustomertoourbusinessinanyparticularperioddependsinpartuponhowlongacustomerhasbeenasubscriberandthedegreetowhichtheyhaveexpandedtheirusageofourplatform.Webelievethat,overtime,asourcustomerbasegrowsandarelativelyhigherpercentageofoursubscriptionrevenueisattributabletorenewalsorgreaterusageamongexistingcustomersrelativetonewcustomers,associatedsalesandmarketingexpensesandotherallocatedupfrontcostsasapercentageofrevenuewilldecrease,subjecttoinvestmentswemaymakeinourbusiness.

Infiscal2017,forendusercustomerswhogeneratedmorethan$1,000,000ofsubscriptionrevenue,salesandmarketingexpenseattributabletothosecustomersrepresentedapproximately30%ofsubscriptionrevenuefromthem.Forendusercustomerswhogeneratedbetween$500,000and$1,000,000insubscriptionrevenue,salesandmarketingexpenseattributabletothosecustomersrepresentedapproximately54%ofoursubscriptionrevenuefromthem.Salesandmarketingexpenseattributabletoendusercustomerswhogeneratedlessthan$500,000insubscriptionrevenueinfiscal2017aregenerallygreaterthansubscriptionrevenuefromthesecustomers.Forthesepurposes,wecalculatesalesandmarketingexpensesallocatedtoacustomerasestimatedpersonnelcostsassociatedwithourfieldorganizationthatsupportssuchcustomer,suchassalariesandcommissions,andallocatedmarketingandoverheadexpenses.ThesecalculationsexcludeIntel,asitisarelatedparty,andstock-basedcompensationexpense.Endusercustomerswhogeneratedmorethan$500,000ofsubscriptionrevenuerepresentedapproximately60%ofourtotalsubscriptionrevenueinfiscal2017,ofwhich65%wasfromendusercustomerswhogenerated

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morethan$1,000,000insubscriptionrevenueand35%wasfromendusercustomerswhogeneratedbetween$500,000and$1,000,000insubscriptionrevenue.

Factors Affecting Our Performance

Acquiring New Customers

Webelievethattheshiftfromlegacydatamanagementsystemstoamoderndataplatformisjustbeginning.WeintendtotargetnewGlobal8000customersbycontinuingtoinvestinourfieldorganization,bothdomesticallyandinternationally.Wearealsocommittedtoextendingandstrengtheningrelationshipswithinourpartnerecosystemtoexpandourreach,increaseourdistributionandincreasethenumberofPartnerSolutions.Webelievethisstrategywillallowustomaximizeleverageforoursalesforce.OurbusinessandresultsofoperationswilldependonourabilitytocontinuetoaddnewGlobal8000customers.

Expanding Penetration within Our Existing Customer Base

Ourexistingcustomerbaseislargeandgrowing,andweremaincommittedtoensuringourcustomersfullyutilizethecapabilitiesofourplatform.Ourcustomersoftenstartwithsmalldeploymentsandthenexpandtheirusagesignificantlyastheyderivevaluefromtheirdatausingourplatform.Ourfieldorganization,togetherwithourpartnerecosystem,assistsourcustomersinidentifyingnewusecases,modernizingtheirdataarchitecturesandachievingsuccesswithdata‑driveninitiatives.Webelievethisallowsourcustomerstofullyrealizethestrategicvalueoftheirdata.OurbusinessandresultsofoperationswilldependonourabilitytodrivehigherusageofourplatformwithinourgrowingbaseofGlobal8000customers.

Investments in Future Growth

WebelievethatweareonlybeginningtopenetrateourmarketopportunitywithGlobal8000companiesandpublicsectorentities,andweintendtocontinuetoinvestinourfuturegrowth.Asdiscussedabove,weexpecttocontinuetomakesignificantinvestmentsinresearchanddevelopmentaswellassalesandmarketingactivities.Wealsoplantocontinuetoinvestinoperationalandadministrativefunctionstosupportourexpectedgrowthandourtransitiontoapubliccompany.Weexpecttousetheproceedsfromourinitialpublicofferingtofundthesegrowthstrategiesanddonotexpecttobeprofitableinthenearfuture.Asdiscussedin“—OurHybridOpenSourceSoftwareBusinessModel—OperatingModel,”theseinvestmentswillbeunprofitableintheshorttermuntilourcustomerbasegrowstoincludeahigherpercentageofsubscriptionrevenuethatisattributabletorenewalsandgreaterusageofourplatform.

Components of Results of Operations

Revenue

Wegeneraterevenueprimarilyfromthesaleofsubscriptionsforourplatformthatourcustomersdeployeitheron‑premisesorinthecloud,aswellasthesaleofservices.Subscriptionrevenuerelatestoterm(ortime‑based)subscriptionstoourplatform,whichincludesbothopensourceandproprietarysoftware.Oursubscriptionarrangementsaretypicallyonetothreeyearsinlengthandwerecognizesubscriptionrevenueratablyoverthetermofthesubscriptionperiod.Oursubscriptionincludesinternet,emailandphonesupport,bugfixesandtherighttoreceiveunspecifiedsoftwareupdatesandupgradesreleasedwhenandifavailableduringthesubscriptionterm.Servicesrevenuerelatestoprofessionalservicesfortheimplementationanduseofoursubscriptions,customertrainingandeducationservices,andrelatedreimbursabletravelcosts.

Cost of Revenue

Costofrevenueforsubscriptionsprimarilyconsistsofpersonnelcostsincludingsalaries,bonuses,travelcosts,benefitsandstock‑basedcompensationforemployeesprovidingtechnicalsupportforoursubscriptioncustomers,allocatedsharedcosts(includingrentandinformationtechnology)andamortizationofacquiredintangibleassetsfrombusinesscombinations.Costofrevenueforservicesprimarilyconsistsofpersonnelcostsincludingsalaries,bonuses,benefitsandstock‑basedcompensation,feestosubcontractorsassociatedwithservicecontracts,travelcostsandallocatedsharedcosts(includingrentandinformationtechnology).Weexpectcostofrevenuetoincrease

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inabsolutedollarsfortheforeseeablefutureaswecontinuetoobtainnewcustomersandexpandourrelationshipwithexistingcustomers.Asdiscussedindetailbelow,see“—SignificantImpactsofStock‑basedCompensationExpense,”duringthesixmonthsendedJuly31,2017ourinitialpublicofferingwasdeclaredeffectiveandtheperformance-basedconditionfortheRSUswaseitherachievedorprobableofbeingachieved.Assuchwerecognizedacumulativecatch‑upofstock‑basedcompensationexpenseattributabletoservicepriortosucheffectivedateforRSUs.

Operating Expenses

Research and Development. Researchanddevelopmentexpensesprimarilyconsistofpersonnelcostsincludingsalaries,bonuses,travelcosts,benefitsandstock‑basedcompensationforourresearchanddevelopmentemployees,contractorfees,allocatedsharedcosts(includingrentandinformationtechnology),supplies,anddepreciationofequipmentassociatedwiththecontinueddevelopmentofourplatformpriortoestablishmentoftechnologicalfeasibilityandtherelatedmaintenanceoftheexistingtechnology.Weexpectourresearchanddevelopmentexpensestoincreaseinabsolutedollarsfortheforeseeablefutureaswecontinuetoenhanceandaddnewtechnologies,featuresandfunctionalitytooursubscriptions.WealsoexpectallocatedsharedcoststoincreaseintheperiodsfollowingthecommencementoftheleaseforournewheadquartersinPaloAltoinJuly2017.Asdiscussedindetailbelow,see“—SignificantImpactsofStock‑basedCompensationExpense,”duringthesixmonthsendedJuly31,2017ourinitialpublicofferingwasdeclaredeffectiveandtheperformance-basedconditionfortheRSUswaseitherachievedorprobableofbeingachieved.Asaresult,werecognizedacumulativecatch‑upofstock‑basedcompensationexpenseattributabletoservicepriortosucheffectivedateforRSUs.

Sales and Marketing. Salesandmarketingexpensesprimarilyconsistofpersonnelcostsincludingsalaries,bonuses,travelcosts,sales‑basedincentives,benefitsandstock‑basedcompensationforoursalesandmarketingemployees.Inaddition,salesandmarketingexpensesalsoincludescostsforadvertising,promotionalevents,corporatecommunications,productmarketingandotherbrand‑buildingactivities,allocatedsharedcosts(includingrentandinformationtechnology)andamortizationofacquiredintangibleassetsfrombusinesscombinations.Sales‑basedincentivesareexpensedasincurred.Weexpectoursalesandmarketingexpensestoincreaseinabsolutedollarsaswecontinuetoinvestinsellingandmarketingactivitiestoattractnewcustomersandexpandourrelationshipwithexistingcustomers.WealsoexpectallocatedsharedcoststoincreaseintheperiodsfollowingthecommencementoftheleaseforournewheadquartersinPaloAltoinJuly2017.Asdiscussedindetailbelow,see“—SignificantImpactsofStock‑basedCompensationExpense,”duringthesixmonthsendedJuly31,2017ourinitialpublicofferingwasdeclaredeffectiveandtheperformance-basedconditionfortheRSUswaseitherachievedorprobableofbeingachieved.Asaresult,werecognizedacumulativecatch‑upofstock‑basedcompensationexpenseattributabletoservicepriortosucheffectivedateforRSUs.

General and Administrative. Generalandadministrativeexpensesprimarilyconsistofpersonnelcostsincludingsalaries,bonuses,travelcosts,benefitsandstock‑basedcompensationforourexecutive,finance,legal,humanresources,informationtechnologyandotheradministrativeemployees.Inaddition,generalandadministrativeexpensesincludefeesforthird‑partyprofessionalservices,includingconsulting,legalandaccountingservicesandothercorporateexpenses,andallocatedsharedcosts(includingrentandinformationtechnology).Weexpectourgeneralandadministrativeexpensestoincreaseinabsolutedollarsduetotheanticipatedgrowthofourbusinessandrelatedinfrastructureaswellaslegal,accounting,insurance,investorrelationsandothercostsassociatedwithbecomingapubliccompany.WealsoexpectallocatedsharedcoststoincreaseintheperiodsfollowingthecommencementoftheleaseforournewheadquartersinPaloAltoinJuly2017.Asdiscussedindetailbelow,see“—SignificantImpactsofStock‑basedCompensationExpense,”duringthesixmonthsendedJuly31,2017ourinitialpublicofferingwasdeclaredeffectiveandtheperformance-basedconditionfortheRSUswaseitherachievedorprobableofbeingachieved.Asaresult,werecognizedacumulativecatch‑upofstock‑basedcompensationexpenseattributabletoservicepriortosucheffectivedateforRSUs.

Interest Income, net

Interestincomeprimarilyrelatestoamountsearnedonourcashandcashequivalentsandmarketablesecurities.

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Other Income (Expense), net

Otherincome(expense),netprimarilyrelatestoforeigncurrencytransactions,realizedgainsandlossesonourmarketablesecurities,andothernon‑operatinggainsorlosses.

Provision for Income Taxes

Provisionforincometaxesprimarilyconsistsofstateandforeignincometaxes.Duetocumulativelosses,wemaintainavaluationallowanceagainstourdeferredtaxassets.Weconsiderallavailableevidence,bothpositiveandnegative,inassessingtheextenttowhichavaluationallowanceshouldbeappliedagainstourdeferredtaxassets.

Significant Impacts of Stock‑‑based Compensation Expense

WehavegrantedRSUstoouremployeesandmembersofourboardofdirectorsunderour2008EquityIncentivePlan,orthe2008Plan.TheemployeeRSUsvestuponthesatisfactionofbothaservice‑basedconditionandaliquidityevent‑relatedperformancecondition.Theservice‑basedvestingconditionfortheseawardsisgenerallysatisfiedpro‑rataoverfouryears.Theliquidityevent‑relatedperformancevestingconditionissatisfiedupontheoccurrenceofaqualifyingevent,suchastheeffectivedateofaninitialpublicoffering,orsixmonthsfollowingtheeffectivedateofaninitialpublicoffering.

Theliquidityevent‑relatedperformanceconditionwasachievedforthemajorityofourRSUsandprobableofbeingachievedfortheremainingRSUsonApril27,2017,theeffectivedateofourinitialpublicoffering.Werecognizedstock‑basedcompensationexpenseusingtheacceleratedattributionmethodwithacumulativecatch‑upofstock‑basedcompensationexpenseintheamountof$181.5millionduringthesixmonthsendedJuly31,2017,attributabletoservicepriortosucheffectivedate.Theshareswillbeissuedonadatetobedeterminedbytheboardofdirectorsthatwillbeonorafterthesecondtradingdayfollowingthereleaseofearningsbyusforthesecondquarteroffiscal2018.

Thetotalstock‑basedcompensationexpenserecordedontheeffectivedateofourinitialpublicofferingassociatedwiththeachievementoftheliquidityevent‑relatedperformanceconditionwasasfollows(inthousands):

Costofrevenue–subscription $ 15,292Costofrevenue–services 19,695Researchanddevelopment 65,250Salesandmarketing 58,219Generalandadministrative 23,080

Totalstock‑basedcompensationexpense $ 181,536

Tender Offer

InMay2015,anunrelatedthirdpartyinitiatedacashtenderofferwhichwascompletedinJuly2015forthepurchaseofourcommonstockfromspecifiedcategoriesofcurrentandformeremployeeswhichhadasignificantimpactonourstock‑basedcompensationexpensefortheyearendedJanuary31,2016,andspecificallyinoursecondquarteroffiscal2016.Sellersparticipatinginthetenderoffersoldatotalof4,079,131sharesofcommonstocktotheunrelatedthirdparty.Thepurchasepricepershareinthetenderofferwasinexcessofthefairvalueofouroutstandingcommonstockatthetimeofthetransactionandaccordingly,uponthecompletionofthetransaction,werecorded$16.6millionasstock‑basedcompensationexpenserelatedtotheexcessofthesellingpricepershareofcommonstockpaidtoouremployeesoverthefairvalueofthetenderedshares.

Additionally,thecompletionofthetenderofferwasaqualifyingliquidityevent,suchthattheperformance‑basedvestingrequirementwassatisfiedforthoseRSUsthathadmettheservice‑basedconditionatthisdate.Uponthecompletionofthetransaction,werecorded$19.7millionofstock‑basedcompensationexpensefortheRSUsforwhichboththeservice‑basedconditionandthequalifyingliquidityeventhadbeenachieved.

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Thetotalstock‑basedcompensationexpenserelatedtothetenderofferimpactedourfiscal2016asfollows(inthousands):

Costofrevenue–subscription $ 1,954Costofrevenue–services 2,514Researchanddevelopment 16,179Salesandmarketing 9,481Generalandadministrative 6,191

Totalstock‑basedcompensationexpense $ 36,319

Results of Operations

Thefollowingtablesetsforthourresultsofoperationsfortheperiodsindicated:

Year EndedJanuary 31,

Six Months EndedJuly 31,

2016 2017 2016 2017 (in thousands)Revenue: Subscription $ 119,150 $ 200,252 $ 91,360 $ 138,657Services 46,898 60,774 29,581 30,767

Totalrevenue 166,048 261,026 120,941 169,424Costofrevenue:(1)(2) Subscription 30,865 38,704 19,057 41,687Services 44,498 48,284 23,317 50,395

Totalcostofrevenue 75,363 86,988 42,374 92,082Grossprofit 90,685 174,038 78,567 77,342Operatingexpenses:(1)(2)(3)

Researchanddevelopment 99,314 102,309 51,150 138,675Salesandmarketing 161,106 203,161 93,044 172,578Generalandadministrative 34,902 55,907 16,676 54,114

Totaloperatingexpenses 295,322 361,377 160,870 365,367Lossfromoperations (204,637) (187,339) (82,303) (288,025)Interestincome,net 2,218 2,756 1,448 2,089Otherincome(expense),net 386 (547) (15) 839Netlossbeforeprovisionforincometaxes (202,033) (185,130) (80,870) (285,097)Provisionforincometaxes (1,110) (2,187) (970) (1,451)

Netloss $ (203,143) $ (187,317) $ (81,840) $ (286,548)

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2016 2017 2016 2017 (in thousands)

Costofrevenue–subscription $ 3,363 $ 1,426 $ 708 $ 19,393

Costofrevenue–services 4,301 1,803 931 24,227

Researchanddevelopment 23,048 5,606 3,013 81,029

Salesandmarketing 19,187 5,757 3,033 72,678

Generalandadministrative 13,691 7,122 3,556 33,206

Totalstock‑basedcompensationexpense $ 63,590 $ 21,714 $ 11,241 $ 230,533




2016 2017 2016 2017

(in thousands)


Salesandmarketing 1,723 1,723 861 861

Totalamortizationofacquiredintangibleassets $ 3,455 $ 3,720 $ 1,830 $ 1,885

(3) InJanuary2017,wedonated1,175,063sharesofcommonstocktotheClouderaFoundation.Werecordedanon‑cashchargeof$21.6millionforthefairvalueofthedonatedshares,whichwasrecognizedingeneralandadministrativeexpensefortheyearendedJanuary31,2017,seeNote12toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforfurtherdiscussion.

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Thefollowingtablesetsforthselectedconsolidatedstatementsofoperationsdataforeachoftheperiodsindicatedasapercentageoftotalrevenue:



2016 2017 2016 2017

Revenue: Subscription 72% 77% 76% 82%Services 28 23 24 18

Totalrevenue 100 100 100 100Costofrevenue(1)(2):

Subscription 18 15 16 24Services 27 18 19 30

Totalcostofrevenue 45 33 35 54Grossmargin 55 67 65 46Operatingexpenses(1)(2)(3):

Researchanddevelopment 60 39 42 82Salesandmarketing 97 78 77 102Generalandadministrative 21 21 14 32

Totaloperatingexpenses 178 138 133 216Lossfromoperations (123) (72) (68) (170)Interestincome,net 1 1 1 1Otherincome(expense),net — — — 1Netlossbeforeprovisionforincometaxes (122) (71) (67) (168)Provisionforincometaxes (1) (1) (1) (1)

Netloss (123)% (72)% (68)% (169)%___________(1) Amountsincludestock‑basedcompensationexpenseasapercentageoftotalrevenueasfollows:



2016 2017 2016 2017Costofrevenue–subscription 2% 1% 1% 11%

Costofrevenue–services 3 1 1 14

Researchanddevelopment 14 2 2 48

Salesandmarketing 11 1 2 43

Generalandadministrative 8 3 3 20

Totalstock‑basedcompensationexpense 38% 8% 9% 136%

(2) Amountsincludeamortizationofacquiredintangibleassetsasapercentageoftotalrevenueasfollows:



2016 2017 2016 2017Costofrevenue–subscription 1% 1% 1% 1%

Salesandmarketing 1 — 1 —

Totalamortizationofacquiredintangibleassets 2% 1% 2% 1%

(3) Asapercentageofrevenue,thenon‑cashexpenserecognizedforthedonationofcommonstocktotheClouderaFoundationfortheyearendedJanuary31,2017was8%.

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Six Months Ended July 31, 2016 and 2017

Revenue

Six Months Ended

July 31, Change

2016 2017 Amount % (dollars in thousands)

Subscription $ 91,360 $ 138,657 $ 47,297 52%Services 29,581 30,767 1,186 4%

Totalrevenue $ 120,941 $ 169,424 $ 48,483 40%

Asapercentageoftotalrevenue: Subscription 76% 82% Services 24% 18%

Totalrevenue 100% 100%

TheincreaseinsubscriptionrevenueforthesixmonthsendedJuly31,2017,ascomparedtothesameperiodsayearago,wasprimarilyattributabletovolumedrivenincreasesinsubscriptionsalestonewandexistingcustomers.OurnetexpansionratefortheperiodendedJuly31,2017was140%ascomparedto137%forthesameperiodayearago.

OurservicesrevenueforthesixmonthsendedJuly31,2017increased,ascomparedtothesameperiodsayearago,atalowerratecomparedtotheincreaseinoursubscriptionrevenueprimarilyduetooureffortstodeveloprelationshipswithpartners,systemintegratorsandtrainingvendors,resultinginashiftoftheprovisionofsuchservicestothesepartners.Customersbenefitfromtheincreasedchoiceinpartners,andweanticipatethatourservicesrevenuewillcontinuetodecreaseasapercentageoftotalrevenueinfutureperiods.

Cost of Revenue, Gross Profit and Gross Margin

Six Months Ended

July 31, Change


Costofrevenue: Subscription $ 19,057 $ 41,687 $ 22,630 119%Services 23,317 50,395 27,078 116%

Totalcostofrevenue $ 42,374 $ 92,082 $ 49,708 117%

Grossprofit $ 78,567 $ 77,342 $ (1,225) (2)%

Grossmargin: Subscription 79% 70% Services 21% (64)%

Totalgrossmargin 65% 46%

Costofrevenue,asapercentageoftotalrevenue: Subscription 16% 24% Services 19% 30%

Totalcostofrevenue 35% 54%

TheincreaseincostofrevenueforsubscriptionforthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagowasprimarilyduetoanincreaseof$18.7millioninstock‑basedcompensationexpenseresulting

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fromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateoftheinitialpublicofferingandanincreaseof$3.2millioninsalariesandbenefitsrelatedtogrowthinemployeeheadcounttosupportouroverallexpansionincustomers.

Subscriptiongrossmargindeclinedfrom79%to70%inthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagoduetotherecordingofstock‑basedcompensationexpenseresultingfromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateoftheinitialpublicoffering.

TheincreaseincostofrevenueforservicesforthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagowasprimarilyduetoanincreaseof$23.3millioninstock‑basedcompensationexpenseresultingfromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateoftheinitialpublicofferingandanincreaseof$3.0millioninsalariesandbenefitsrelatedtogrowthinemployeeheadcount.

Servicesgrossmargindeclinedfrom21%tonegative64%inthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagoduetotherecordingofstock‑basedcompensationexpenseresultingfromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateoftheinitialpublicoffering.

Operating Expenses

Six Months Ended

July 31, Change


Researchanddevelopment $ 51,150 $ 138,675 $ 87,525 171%Salesandmarketing 93,044 172,578 79,534 85%Generalandadministrative 16,676 54,114 37,438 225%

Totaloperatingexpenses $ 160,870 $ 365,367 $ 204,497 127%

Operatingexpenses,asapercentageoftotalrevenue: Researchanddevelopment 42% 82% Salesandmarketing 77% 102% Generalandadministrative 14% 32%

Totaloperatingexpenses 133% 216%

Research and Development

TheincreaseinresearchanddevelopmentexpensesforthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagowasprimarilyduetoanincreaseof$78.0millioninstock‑basedcompensationexpenseresultingfromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateoftheinitialpublicofferingandanincreaseof$7.7millioninemployee‑relatedcostsincludingsalaries,benefitsandtravelcosts,associatedwiththegrowthinemployeeheadcount.

Sales and Marketing

TheincreaseinsalesandmarketingexpensesforthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagowasprimarilyduetoanincreaseof$69.6millioninstock‑basedcompensationexpenseresultingfromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateoftheinitialpublicofferingandanincreaseof$9.5millioninemployee‑relatedcostsincludingsalaries,incentive‑basedcompensation,benefitsandtravelcosts,associatedwiththegrowthinemployeeheadcounttosupportouroverallsalesactivities.

General and Administrative

TheincreaseingeneralandadministrativeexpensesforthesixmonthsendedJuly31,2017ascomparedtothesameperiodayearagowasprimarilyduetoanincreaseof$29.7millioninstock‑basedcompensationexpenseresultingfromtheachievementoftheliquidityevent‑relatedperformanceconditionontheeffectivedateofthe

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initialpublicoffering,anincreaseof$4.7millioninemployee‑relatedcostsincludingsalaries,benefitsandtravelcosts,associatedwiththegrowthinemployeeheadcounttosupportouroverallexpansion,andacashdonationof$2.4million,or1%ofthenetproceedsfromtheinitialpublicoffering,tofundtheClouderaFoundation.


Six Months Ended

July 31, Change


Provisionforincometaxes $ (970) $ (1,451) $ (481) 50%

ProvisionforincometaxesincreasedinthesixmonthsendedJuly31,2017,ascomparedtothesameperiodayearago,primarilyduetoanincreaseinpre‑taxincomeandtaxwithholdingsinourforeignlocationsdrivenbyourcontinuedinternationalexpansionintonewcountries.

Year Ended January 31, 2016 and 2017

Revenue

Year Ended January 31, Change


Subscription $ 119,150 $ 200,252 $ 81,102 68%Services 46,898 60,774 13,876 30%

Totalrevenue $ 166,048 $ 261,026 $ 94,978 57%

Asapercentageoftotalrevenue: Subscription 72% 77% Services 28% 23%

Totalrevenue 100% 100%

Theincreaseinsubscriptionrevenuewasprimarilyattributabletovolumedrivenincreasesinsubscriptionsalestonewandexistingcustomers.OurnetexpansionratefortheperiodendedJanuary31,2017was142%.

Ourservicesrevenueincreasedatalowerratecomparedtotheincreaseinoursubscriptionrevenueprimarilyduetoourexistingcustomersincreasingexperiencewiththetechnologyandoureffortstodeveloprelationshipswithpartnersandothersystemintegrators,resultinginashiftoftheprovisionofsuchservicestothesepartners.

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Cost of Revenue, Gross Profit and Gross Margin



Costofrevenue: Subscription $ 30,865 $ 38,704 $ 7,839 25%Services 44,498 48,284 3,786 9%

Totalcostofrevenue $ 75,363 $ 86,988 $ 11,625 15%

Grossprofit $ 90,685 $ 174,038 $ 83,353 92%

Grossmargin: Subscription 74% 81% Services 5% 21%

Totalgrossmargin 55% 67%

Costofrevenue,asapercentageoftotalrevenue: Subscription 18% 15% Services 27% 18%

Totalcostofrevenue 45% 33%

Theincreaseincostofrevenueforsubscriptionwasprimarilyduetoanincreaseof$8.0millioninsalariesandbenefitsrelatedtogrowthinemployeeheadcounttosupportouroverallexpansionincustomersandanincreaseof$1.1millioninallocatedsharedcosts,partiallyoffsetbyadecreaseof$1.9millioninstock‑basedcompensationexpensemainlyduetothetenderofferinJuly2015,whichwasnotrepeatedinfiscal2017.

Subscriptiongrossmarginimprovedfrom74%to81%intheyearendedJanuary31,2017ascomparedtothesameperiodayearago.

Theincreaseincostofrevenueforserviceswasprimarilyduetoanincreaseof$4.1millioninsalariesandbenefitsrelatedtogrowthinemployeeheadcountandanincreaseof$1.3millioninfeestosubcontractorsasaresultofhigherdemandofservicesbyourcustomers,offsetbyadecreaseof$2.5millioninstock‑basedcompensationexpensemainlyduetothetenderofferinJuly2015,whichwasnotrepeatedinfiscal2017.

Servicesgrossmarginimprovedfrom5%to21%intheyearendedJanuary31,2017ascomparedtothesameperiodayearago.

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Operating Expenses



Researchanddevelopment $ 99,314 $ 102,309 $ 2,995 3%Salesandmarketing 161,106 203,161 42,055 26%Generalandadministrative 34,902 55,907 21,005 60%

Totaloperatingexpenses $ 295,322 $ 361,377 $ 66,055 22%

Operatingexpenses,asapercentageoftotalrevenue: Researchanddevelopment 60% 39% Salesandmarketing 97% 78% Generalandadministrative 21% 21%

Totaloperatingexpenses 178% 138%


Theincreaseinresearchanddevelopmentexpenseswasprimarilyduetoanincreaseof$15.8millioninemployee‑relatedcostsincludingsalaries,benefitsandtravelcosts,associatedwiththegrowthinemployeeheadcount,anincreaseof$0.9millionindepreciationexpenseofequipmenttosupportourresearchanddevelopmentactivitiesandanincreaseof$1.7millioninallocatedsharedcosts,partiallyoffsetbyadecreaseof$17.4millioninstock‑basedcompensationexpensemainlyduetothetenderofferinJuly2015whichwasnotrepeatedinfiscal2017.

Sales and Marketing

Theincreaseinsalesandmarketingexpenseswasprimarilyduetoanincreaseof$46.5millioninemployee‑relatedcostsincludingsalaries,incentive‑basedcompensation,benefitsandtravelcosts,associatedwiththegrowthinemployeeheadcounttosupportouroverallsalesactivitiesandanincreaseof$2.9millioninallocatedsharedcosts,offsetbyadecreaseof$13.4millioninstock‑basedcompensationexpensemainlyduetothetenderofferinJuly2015whichwasnotrepeatedinfiscal2017.

General and Administrative

Theincreaseingeneralandadministrativeexpenseswasprimarilyduetoa$21.6millionnon‑cashchargerelatedtothedonationof1,175,063sharesofcommonstocktotheClouderaFoundationinthefourthquarteroffiscal2017andanincreaseof$8.6millioninemployee‑relatedcostsincludingsalaries,benefitsandtravelcosts,associatedwiththegrowthinemployeeheadcounttosupportouroverallexpansion,offsetbyadecreaseof$6.6millioninstock‑basedcompensationexpensemainlyduetothetenderofferinJuly2015whichwasnotrepeatedinfiscal2017anddecreasesinthirdpartyconsultingandprofessionalservicecosts.

Interest Income, net



Interestincome,net $ 2,218 $ 2,756 $ 538 24%

Interestincome,netincreasedprimarilyasaresultofhigherinterestratesobtainedfrominvestingmoreofourcashandcashequivalentsinmarketablesecuritiesduringtheyearendedJanuary31,2017ascomparedtoayearago.

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Other Income (Expense), net



Otherincome(expense),net $ 386 $ (547) $ (933) notmeaningful

Otherincome(expense),netdecreasedprimarilyasaresultofanescrowclaimadjustmentinfiscal2016of$0.8millionrelatedtoafiscal2015acquisitionoutsideofthemeasurementperiod.




Provisionforincometaxes $ 1,110 $ 2,187 $ 1,077 97%

Provisionforincometaxesincreasedprimarilyduetoanincreaseinpre‑taxincomeinourforeignlocationsdrivenbyourcontinuedinternationalexpansionintonewcountries.

Seasonality

Wehaveseasonalandend‑of‑quarterconcentrationofoursales,whichimpactsourabilitytoplanandmanagecashflowsandmargins.Oursalesvarybyseasonwiththefourthquartertypicallybeingourlargest.Inaddition,withineachquarter,mostsalesoccurinthelastmonthofthatquarter.See“RiskFactors—Oursalescyclescanbelong,unpredictableandvaryseasonally,particularlywithrespecttolargesubscriptions,andoursaleseffortsrequireconsiderabletimeandexpense.”

Quarterly Results of Operations

ThefollowingtablessetforthourunauditedquarterlyconsolidatedstatementsofoperationsdataforeachofthetenquartersintheperiodendedJuly31,2017.Wehavepreparedthequarterlyresultsofoperationsdataonabasisconsistentwithourauditedconsolidatedfinancialstatementsincludedinthisprospectus.Intheopinionofmanagement,thefinancialinformationreflectsalladjustmentsconsistingofonlynormalrecurringadjustments,whichweconsidernecessaryforafairpresentationofthisdata.Ourhistoricalresultsarenotnecessarilyindicativeoftheresultsthatmaybeexpectedinanyfutureperiod.Thefollowingquarterlyfinancialdatashouldbereadinconjunctionwithourauditedconsolidatedfinancialstatementsandrelatednotesincludedinthisprospectus.

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Three Months Ended

Consolidated Statements of Operations:April 30,

2015 July 31, 2015 October 31,

2015 January 31, 2016 April 30,

2016 July 31, 2016 October 31,

2016 January 31, 2017 April 30,

2017 July 31, 2017

(in thousands)

Revenue:

Subscription $ 23,170 $ 27,641 $ 31,613 $ 36,726 $ 40,672 $ 50,688 $ 52,733 $ 56,159 $ 64,671 $ 73,986

Services 10,575 10,631 12,039 13,653 15,813 13,768 14,525 16,668 14,925 15,842

Totalrevenue 33,745 38,272 43,652 50,379 56,485 64,456 67,258 72,827 79,596 89,828

Costofrevenue(1)(2)(3):

Subscription 6,234 8,630 7,289 8,712 9,351 9,706 9,787 9,860 26,472 15,215

Services 9,794 13,180 10,160 11,364 11,684 11,633 12,652 12,315 33,640 16,755

Totalcostofrevenue 16,028 21,810 17,449 20,076 21,035 21,339 22,439 22,175 60,112 31,970

Grossprofit 17,717 16,462 26,203 30,303 35,450 43,117 44,819 50,652 19,484 57,858

Operatingexpenses(1)(2)(3):

Researchanddevelopment 18,944 37,560 21,316 21,494 24,515 26,635 25,968 25,191 95,831 42,844

Salesandmarketing 30,253 46,289 39,676 44,888 46,142 46,902 54,206 55,911 110,443 62,135

Generalandadministrative 6,601 14,138 6,716 7,447 8,309 8,367 8,633 30,598 35,550 18,564

Totaloperatingexpenses 55,798 97,987 67,708 73,829 78,966 81,904 88,807 111,700 241,824 123,543

Lossfromoperations $ (38,081) $ (81,525) $ (41,505) $ (43,526) $ (43,516) $ (38,787) $ (43,988) $ (61,048) $ (222,340) $ (65,685)

Other Financial Data:

Non-GAAPoperatingloss $ (31,006) $ (36,963) $ (32,736) $ (36,887) $ (36,968) $ (32,264) $ (37,726) $ (33,373) $ (30,314) $ (25,293)


Three Months Ended

April 30, 2015 July 31,

2015 October 31, 2015 January 31,

2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

(in thousands)

Costofrevenue–subscription $ 287 $ 2,279 $ 442 $ 355 $ 334 $ 374 $ 343 $ 375 $ 15,700 $ 3,693

Costofrevenue–services 437 2,963 462 439 474 457 432 440 20,337 3,890

Researchanddevelopment 1,820 17,838 1,822 1,568 1,555 1,458 1,313 1,280 67,901 13,128

Salesandmarketing 1,987 12,247 3,286 1,667 1,559 1,474 1,463 1,261 60,541 12,137Generaland

administrative 1,663 8,377 1,899 1,752 1,741 1,815 1,766 1,800 26,603 6,603

Totalstock‑basedcompensationexpense $ 6,194 $ 43,704 $ 7,911 $ 5,781 $ 5,663 $ 5,578 $ 5,317 $ 5,156 $ 191,082 $ 39,451


Three Months Ended

April 30, 2015 July 31,


2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

(in thousands)

Costofrevenue–subscription $ 451 $ 427 $ 427 $ 427 $ 455 $ 514 $ 514 $ 514 $ 514 $ 510

Salesandmarketing 430 431 431 431 430 431 431 431 430 431Totalamortizationof

acquiredintangibleassets $ 881 $ 858 $ 858 $ 858 $ 885 $ 945 $ 945 $ 945 $ 944 $ 941

(3) InJanuary2017,wedonated1,175,063sharesofcommonstocktotheClouderaFoundation,withtheapprovaloftheboardofdirectors.Werecordedanon‑cashchargeof$21.6millionforthefairvalueofthedonatedshares,whichwasrecognizedingeneralandadministrativeexpenseforthethreemonthsendedJanuary31,2017,seeNote12toourconsolidatedfinancialstatementsincludedelsewhereinthisprospectusforfurtherdiscussion.

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Thefollowingtableprovidesareconciliationoflossfromoperationstonon‑GAAPoperatingloss:

Three Months Ended

April 30, 2015 July 31,


2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

(in thousands)

Lossfromoperations $ (38,081) $ (81,525) $ (41,505) $ (43,526) $ (43,516) $ (38,787) $ (43,988) $ (61,048) $ (222,340) $ (65,685)Stock-basedcompensation

expense 6,194 43,704 7,911 5,781 5,663 5,578 5,317 5,156 191,082 39,451Amortizationofacquired

intangibleassets 881 858 858 858 885 945 945 945 944 941Donationofcommonstockto

theClouderaFoundation — — — — — — — 21,574 — —

Non-GAAPoperatingloss $ (31,006) $ (36,963) $ (32,736) $ (36,887) $ (36,968) $ (32,264) $ (37,726) $ (33,373) $ (30,314) $ (25,293)

Thefollowingtablesetsforthselectedconsolidatedstatementsofoperationsdataforeachoftheperiodsindicatedasapercentageoftotalrevenue:

Three Months Ended

Consolidated Statements ofOperations:

April 30, 2015 July 31,


2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

Revenue:

Subscription 69% 72% 72% 73% 72% 79% 78% 77% 81% 82%

Services 31 28 28 27 28 21 22 23 19 18

Totalrevenue 100 100 100 100 100 100 100 100 100 100

Costofrevenue(1)(2)(3):

Subscription 18 23 17 17 16 15 15 14 33 17

Services 29 34 23 23 21 18 18 16 43 19

Totalcostofrevenue 47 57 40 40 37 33 33 30 76 36

Grossprofit 53 43 60 60 63 67 67 70 24 64

Operatingexpenses(1)(2)(3): Researchanddevelopment 56 98 49 42 43 41 39 35 120 48

Salesandmarketing 90 121 91 89 82 73 80 76 139 69Generalandadministrative 19 37 15 15 15 13 13 42 44 20

Totaloperatingexpenses 165 256 155 146 140 127 132 153 303 137

Lossfromoperations (113)% (213)% (95)% (86)% (77)% (60)% (65)% (84)% (279)% (73)%

Other Financial Data: Non-GAAPoperatingloss (92)% (97)% (75)% (73)% (65)% (50)% (56)% (46)% (38)% (28)%

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___________(1) Amountsincludestock‑basedcompensationexpenseasapercentageoftotalrevenueasfollows:

Three Months Ended

April 30, 2015 July 31,


2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

Costofrevenue–subscription 1% 6% 1% 1% —% 1% 1% 1% 20% 4%

Costofrevenue–services 1 8 1 1 1 1 1 1 26 4

Researchanddevelopment 5 46 4 3 3 2 2 2 85 15

Salesandmarketing 6 32 8 3 3 2 2 1 76 14Generalandadministrative 5 22 4 3 3 3 2 2 33 7

Totalstock‑basedcompensationexpense 18% 114% 18% 11% 10% 9% 8% 7% 240% 44%

(2) Amountsincludeamortizationofacquiredintangibleassetsasapercentageoftotalrevenueasfollows:

Three Months Ended

April 30, 2015 July 31,


2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

Costofrevenue–subscription 2% 1% 1% 1% 1% 1% 1% 1% 1% 1%

Salesandmarketing 1 1 1 1 1 — — — — —Totalamortizationofacquiredintangibleassets 3% 2% 2% 2% 2% 1% 1% 1% 1% 1%

(3) Asapercentageofrevenue,thenon‑cashexpenserecognizedforthedonationofcommonstocktotheClouderaFoundationinthethreemonthsendedJanuary31,2017was29%.

Quarterly Trends in Revenue

Quarterlysubscriptionandservicesrevenueeachincreasedsequentiallyeachquarter,exceptforservicesrevenueduringthethreemonthsendedJuly31,2016andthethreemonthsendedApril30,2017.TheincreaseswereprimarilyduetovolumedrivenincreasesinsubscriptionsalestonewandexistingcustomersincludinganincreaseinthenumberofGlobal8000customers.ThedecreaseinservicesrevenueduringthethreemonthsendedJuly31,2016andthethreemonthsendedApril30,2017wasmainlyduetotheattainmentofamilestoneforalargeservicesprojectinthepreviousquarter.

Quarterly Trends in Cost of Revenue

Costofrevenueincreasedsequentiallyeachquarter,exceptcostofrevenueforthethreemonthsendedJuly31,2015wasslightlyhigherthanmostotherperiodspresenteddueto$4.5millionofstock‑basedcompensationexpenserelatedtothetenderofferinJuly2015,andcostofrevenueforthethreemonthsendedOctober31,2016wasslightlyhigherduetoexpensesassociatedwithsendingserviceemployeestoourlargestuserconference,StrataDataConference,duringthethirdquarteroffiscal2017.CostofrevenueforthethreemonthsendedApril30,2017andJuly31,2017washigherthanotherperiodsduetostock‑basedcompensationexpenseof$36.0millionand$7.6million,respectively,primarilyduetotheperformance-basedconditionfortheRSUsbeingeitherachievedorprobableofbeingachievedontheeffectivedateoftheinitialpublicoffering.Otherquarter-over-quarterincreaseswereprimarilyduetoanincreaseinsalariesandbenefitsasaresultofheadcountgrowthtosupportincreasesinnewcustomersandtheexpansionofourrelationshipwithexistingcustomers.

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Quarterly Trends in Operating Expenses

Operatingexpensesincreasedsequentiallyeachquartergenerally,exceptoperatingexpensesforthethreemonthsendedJuly31,2017.OperatingexpensesforthethreemonthsendedJuly31,2015wereslightlyhigherthanmostotherperiodspresenteddueto$31.8millionofstock‑basedcompensationexpenserelatedtothetenderofferinJuly2015.OperatingexpensesforthethreemonthsendedApril30,2017andJuly31,2017werehigherthanmostotherperiodsprimarilyduetostock‑basedcompensationexpenseresultingfromtheperformance-basedconditionfortheRSUsbeingeitherachievedorprobableofbeingachievedontheeffectivedateoftheinitialpublicoffering.ThedecreaseinresearchanddevelopmentexpensesforthethreemonthsendedOctober31,2016wasmainlyduetoareductionincloudcomputingcosts.TheslightdecreaseinresearchanddevelopmentexpensesforthethreemonthsendedJanuary31,2017wasduetoexpensesassociatedwithaninternalconferenceforresearchanddevelopmentemployeesthatoccurredduringthepreviousquarter.Otherquarter-over-quarterincreaseswereprimarilyduetoanincreaseinsalariesandbenefitsasaresultofanincreaseinheadcounttosupportouroverallgrowthandanincreaseinsalesandmarketinginitiatives.

Net Expansion Rate

Wereviewournetexpansionratetoevaluateandmeasureourcustomerrelationships.Thefollowingtablesetsforthournetexpansionrateasoftheendofeachofthelasteightfiscalquarters:

As of

October 31, 2015 January 31,

2016 April 30, 2016 July 31,


2017 April 30, 2017 July 31,

2017

Netexpansionrate 134% 130% 134% 137% 143% 142% 142% 140%

Ourquarterlynetsubscriptionrevenueexpansionrateequals:


divided by


Ournetexpansionrateequalsthesimplearithmeticaverageofourquarterlynetsubscriptionrevenueexpansionrateforthefourquartersendingwiththemostrecentlycompletedfiscalquarter.WehaveexcludedIntelfromourcalculationofnetexpansionrate,asitisarelatedparty.Ourexperiencehasbeenthatnetexpansionratesaregenerallyconsistentacrosscustomercohorts,irrespectiveoftheageofthecohort.

Liquidity and Capital Resources

AsofJuly31,2017,ourprincipalsourcesofliquiditywerecash,cashequivalentsandmarketablesecuritiestotaling$475.8millionwhichwereheldforworkingcapitalpurposes.Ourcashequivalentsarecomprisedprimarilyofmoneymarketfunds,commercialpaper,andreverserepurchaseagreements,andourmarketablesecuritiesarecomprisedofU.S.agencyobligations,asset‑backedsecurities,corporatenotesandobligations,municipalsecurities,certificatesofdepositandU.S.treasurysecurities.Todate,ourprincipalsourcesofliquidityhavebeenthenetproceedswereceivedthroughprivatesalesofequitysecurities,aswellaspaymentsreceivedfromcustomersforoursubscriptionsandservices.

Webelieveourexistingliquiditywillbesufficienttomeetourworkingcapitalandcapitalexpenditureneedsforatleastthenexttwelvemonths.Ourfuturecapitalrequirementsmayvarymateriallyfromthosecurrentlyplannedandwilldependonmanyfactors,includingournetexpansionrate,thetimingandextentofspendingonresearchanddevelopmentefforts,theexpansionofsalesandmarketingactivities,thecontinuingmarketacceptanceofoursubscriptionsandservicesandongoinginvestmentstosupportthegrowthofourbusiness.Wemayinthefutureenterintoarrangementstoacquireorinvestincomplementarybusinesses,servicesandtechnologiesandintellectualpropertyrights.Fromtimetotime,wemayexploreadditionalfinancingsourceswhichcouldincludeequity,equity-

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linkedanddebtfinancingarrangements.Wecannotassureyouthatanyadditionalfinancingwillbeavailableontermsfavorabletous,oratall.Ifadequatefundsarenotavailableonacceptableterms,oratall,wemaynotbeabletoadequatelyfundourbusinessplansanditcouldhaveanegativeeffectonouroperatingcashflowsandfinancialcondition.

Thefollowingtablesummarizesourcashflowsfortheperiodsindicated:



2016 2017 2016 2017 (in thousands)Cashusedinoperatingactivities $ (90,497) $ (116,561) $ (52,099) $ (17,866)Cashprovidedby(usedin)investingactivities (242,682) 168,586 65,073 (228,323)Cashprovidedbyfinancingactivities 9,663 1,538 1,633 243,618Effectofexchangeratechanges (334) 75 34 (77)

Netincrease(decrease)incash,cashequivalentsandrestrictedcash $ (323,850) $ 53,638 $ 14,641 $ (2,648)

Cash Used in Operating Activities

DuringthesixmonthsendedJuly31,2017,cashusedinoperatingactivitieswas$17.9millionwhichwasduetoanetlossof$286.5millionoffsetbynon‑cashadjustmentsof$237.9millionandadecreasefromnetchangeinoperatingassetsandliabilitiesof$30.7million.Non‑cashadjustmentsconsistedof$7.0millionofdepreciationandamortization,$230.5millionofstock‑basedcompensation,and$0.4millioninaccretionandamortizationofmarketablesecurities.Thenetchangeinoperatingassetsandliabilitieswasduetoanincreaseindeferredrevenueof$13.7millionduetothetimingofamountsbilledtocustomerscomparedtorevenuerecognizedduringthesameperiod,anincreaseinaccountspayableandaccruedexpensesandotherliabilitiesof$4.6millionduetotimingofpaymentstovendors,adecreaseinprepaidexpensesandotherassetsof$0.6million,adecreaseinaccountsreceivableof$16.7millionduetothetimingofinvoicingcomparedtothereceiptofcashfromcustomers,offsetbyadecreaseinaccruedcompensationof$5.0millionduetothetimingofbonusandincentive-basedcompensationpayments.

DuringthesixmonthsendedJuly31,2016,cashusedinoperatingactivitieswas$52.1millionwhichwasduetoanetlossof$81.8millionpartiallyoffsetbynon‑cashadjustmentsof$18.2millionandadecreasefromnetchangeinoperatingassetsandliabilitiesof$11.6million.Non‑cashadjustmentsconsistedof$5.0millionofdepreciationandamortization,$11.2millionofstock‑basedcompensationand$2.0millioninaccretionandamortizationofmarketablesecurities.Thenetchangeinoperatingassetsandliabilitieswasduetoanincreaseindeferredrevenueof$8.6millionduetothereceiptofcashfromcustomersinadvanceofrevenuerecognition,anincreaseinaccountspayableandaccruedexpensesandotherliabilitiesof$2.9millionduetogrowthinoperationsandtimingofpaymentstovendors,adecreaseinaccountsreceivableof$4.0millionduetothetimingofinvoicingcomparedtothereceiptofcashfromcustomers,offsetbyanincreaseof$0.8millioninprepaidexpensesandotherassets,adecreaseinaccruedcompensationof$3.1millionduetothetimingofbonusandincentive-basedcompensationpayments.

DuringtheyearendedJanuary31,2017,cashusedinoperatingactivitieswas$116.6millionwhichwasduetoanetlossof$187.3millionpartiallyoffsetbynon‑cashadjustmentsof$56.3millionandanincreasefromnetchangeinoperatingassetsandliabilitiesof$14.5million.Non‑cashadjustmentsconsistedof$10.1millionofdepreciationandamortization,$21.7millionofstock‑basedcompensation,$21.6millionofexpenseforthedonationofcommonstocktotheClouderaFoundationand$2.9millioninaccretionandamortizationofmarketablesecurities.Thenetchangeinoperatingassetsandliabilitieswasduetoanincreaseindeferredrevenueof$59.2millionduetothetimingofamountsbilledtoorcollectedfromcustomers,providedtherelatedsubscriptionandserviceshascommenced,inadvanceofrevenuerecognition,anincreaseinaccountspayableandaccruedexpensesandotherliabilitiesof$0.6millionduetogrowthinoperationsandtimingofpaymentstovendors,an

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increaseinaccruedcompensationof$11.2millionduetoanincreaseinheadcount,offsetbyanincreaseinprepaidexpensesandotherassetsof$3.3millionandanincreaseinaccountsreceivableof$52.1millionduetothetimingofinvoicingcomparedtothereceiptofcashfromcustomers.

DuringtheyearendedJanuary31,2016,cashusedinoperatingactivitieswas$90.5millionwhichwasduetoanetlossof$203.1millionpartiallyoffsetbynon‑cashadjustmentsof$75.8millionandanincreasefromnetchangeinoperatingassetsandliabilitiesof$36.9million.Non‑cashadjustmentsconsistedof$8.6millionofdepreciationandamortization,$63.6millionofstock‑basedcompensationand$3.6millioninaccretionandamortizationofmarketablesecurities.Thenetchangeinoperatingassetsandliabilitieswasduetoanincreaseindeferredrevenueof$42.1millionduetothereceiptofcashfromcustomersinadvanceofrevenuerecognition,anincreaseinaccountspayableandaccruedexpensesandotherliabilitiesof$6.2millionduetogrowthinoperationsandtimingofpaymentstovendors,anincreaseinaccruedcompensationof$9.4millionduetoanincreaseinheadcount,partiallyoffsetbyanincreaseinaccountsreceivableof$19.0millionduetothetimingofinvoicingcomparedtothereceiptofcashfromcustomers,andanincreaseof$1.8millioninprepaidexpensesandotherassets.

Cash Provided by (Used in) Investing Activities

DuringthesixmonthsendedJuly31,2017,cashusedininvestingactivitieswas$228.3millionwhichwasduetopurchasesofmarketablesecuritiesof$387.2millionandcapitalexpendituresforthepurchaseofpropertyandequipmentof$2.0million,offsetbysalesandmaturitiesofmarketablesecuritiesof$160.8million.

DuringthesixmonthsendedJuly31,2016,cashprovidedbyinvestingactivitieswas$65.1millionwhichwasduetosalesandmaturitiesofmarketablesecuritiesof$164.3million,offsetbypurchasesofmarketablesecuritiesof$90.4million,cashusedinbusinesscombinations,netofcashacquired,of$2.7million,andpurchasesofpropertyandequipmentof$6.1million.

DuringtheyearendedJanuary31,2017,cashprovidedbyinvestingactivitieswas$168.6millionwhichwasduetosalesandmaturitiesofmarketablesecuritiesof$282.4million,partiallyoffsetbypurchasesofmarketablesecuritiesof$103.8million,capitalexpendituresforthepurchaseofpropertyandequipmentof$7.4millionandcashusedinbusinesscombinations,netofcashacquired,of$2.7million.

DuringtheyearendedJanuary31,2016,cashusedininvestingactivitieswas$242.7millionwhichwasduetopurchasesofmarketablesecuritiesof$411.5million,cashusedinbusinesscombinations,netofcashacquired,of$8.9million,purchasesofpropertyandequipmentof$5.5million,partiallyoffsetbysalesandmaturitiesofmarketablesecuritiesof$183.3million.

Cash Provided by Financing Activities

DuringthesixmonthsendedJuly31,2017,cashprovidedbyfinancingactivitieswas$243.6millionwhichwasduetothenetproceedsfromtheissuanceofcommonstockintheinitialpublicofferingof$237.7millionandproceedsfromtheexerciseofstockoptionsandESPPwithholdingsof$5.9million.

DuringthesixmonthsendedJuly31,2016,cashprovidedbyfinancingactivitieswas$1.6millionwhichwasduetoproceedsfromtheexerciseofstockoptions.

DuringtheyearendedJanuary31,2017,cashprovidedbyfinancingactivitieswas$1.5millionwhichwasduetoproceedsfromtheissuanceofcommonstockuponexerciseofstockoptionsof$3.6million,offsetbypaymentofdeferredofferingcostsof$2.1million.

DuringtheyearendedJanuary31,2016,cashprovidedbyfinancingactivitieswas$9.7millionwhichwasduetonetproceedsof$10.9millionfromtheexerciseofstockoptions,offsetby$1.2millioninpaymentsfornetsharesettlementofRSUsrelatedtoemployeetaxes.

Off ‑Balance Sheet Arrangements

Wehavenotenteredintoanyoff‑balancesheetarrangementsanddonothaveanyholdingsinvariableinterestentities.

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Contractual Obligations and Commitments

Thefollowingtablesummarizesournon‑cancelablecontractualobligationsasofJuly31,2017:

Payments Due By Period

Total Less than 1 Year 1‑‑2 Years 3‑‑5 Years More than 5

Years (in thousands)

Operatingleases(1) $ 296,705 $ 22,378 $ 33,276 $ 95,239 $ 145,812

Totalcontractualobligations $ 296,705 $ 22,378 $ 33,276 $ 95,239 $ 145,812___________(1) Weleaseourfacilitiesunderlong‑termoperatingleases,whichexpireatvariousdatesthrough2027.Theleaseagreementsfrequentlyincludeprovisionswhichrequireus

topaytaxes,insurance,ormaintenancecosts.

InJune2017,weenteredintoanewnon‑cancelableoperatingleaseagreementtorentofficespaceinSanFrancisco,California.Theleasehasan87‑monthterm,commencesinJanuary2018andendsinApril2025withanoptiontorenewforanadditional60months.Totalminimumleasepaymentsundertheleaseagreement,includedinthetableabove,are$34.5million,ofwhich$0.4millionwasrequiredtobeprepaiduponexecutionoftheleaseagreement.TherewerenoothermaterialchangestoourcontractualobligationsandcommitmentsduringthesixmonthsendedJuly31,2017fromthecontractualobligationsandcommitmentsasofJanuary31,2017.

Deferred Revenue and Unbilled Deferred Revenue

Ourdeferredrevenueconsistsofamountsthathavebeeninvoicedbutthathavenotyetbeenrecognizedasrevenueasoftheendofareportingperiod.

Unbilleddeferredrevenuerepresentsfuturenon‑cancelablecustomercommitmentsunderoursubscriptionagreementsthathavenotbeeninvoicedand,accordingly,arenotrecordedindeferredrevenue.Forourannualormultiple‑yearsubscriptioncontractswetypicallyinvoiceaninitialannualamountatcontractsigningfollowedbysubsequentannualinvoicesoverthecontractterm.Untiltheseamountsareinvoiced,theyarenotrecordedinrevenue,deferredrevenue,accountsreceivableorelsewhereinourconsolidatedfinancialstatements,andareconsideredbyustobeunbilleddeferredrevenue.Weexpectunbilleddeferredrevenuetofluctuatefromperiodtoperiodforseveralreasons,includingthetiminganddurationofcustomercontracts,varyingbillingcyclesandthetiminganddurationofcustomerrenewals.Unbilleddeferredrevenuedoesnotincludeminimumrevenuecommitmentsfromresellersaswerecognizerevenueanddeferredrevenueuponsell‑throughtoanendusercustomer.

OurtotaldeferredrevenueandunbilleddeferredsubscriptionrevenueasofJanuary31,2017was$378.3million.

Quantitative and Qualitative Disclosures about Market Risk

WehaveoperationsbothwithintheUnitedStatesandinternationally,andweareexposedtomarketrisksintheordinarycourseofourbusiness.Ourmarketriskexposureisprimarilyaresultoffluctuationsininterestratesandforeigncurrencyexchangerates.Informationrelatingtoquantitativeandqualitativedisclosuresaboutthesemarketsrisksisdescribedbelow.

Interest Rate Risk

Ourprimaryexposuretomarketriskrelatestointerestratechanges.Wehadcashandcashequivalentsandmarketablesecuritiestotaling$255.7millionand$475.8millionasofJanuary31,2017andJuly31,2017,respectively,whichwereheldforworkingcapitalpurposes.Ourcashequivalentsarecomprisedprimarilyofmoneymarketfunds,commercialpaper,andreverserepurchaseagreements,andourmarketablesecuritiesarecomprisedofU.S.agencyobligations,asset‑backedsecurities,corporatenotesandobligations,municipalsecurities,certificatesofdepositandU.S.treasurysecurities.Ourinvestmentsaremadeforcapitalpreservationpurposes.Wedonothold

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orissuefinancialinstrumentsfortradingorspeculativepurposes.Ahypothetical100basispointchangeininterestrateswouldchangethefairvalueofourinvestmentsinmarketablesecuritiesby$1.8millionand$4.1millionasofJanuary31,2017andJuly31,2017,respectively.

Foreign Currency Risk

OurrevenueandexpensesareprimarilydenominatedinU.S.dollars.Forournon‑U.S.operations,themajorityofourrevenueandexpensesaredenominatedinothercurrenciessuchasEuro,BritishPoundSterling,AustralianDollarandChineseYuan.FortheyearendedJanuary31,2017,approximately10%ofourrevenueandapproximately17%ofaggregatecostofsalesandoperatingexpensesweregeneratedincurrenciesotherthanU.S.dollars.ForthesixmonthsendedJuly31,2017,approximately11%ofourrevenueandapproximately10%ofaggregatecostofsalesandoperatingexpensesweregeneratedincurrenciesotherthanU.S.dollars.

FortheyearendedJanuary31,2017,werecordedalossonforeignexchangetransactionsof$0.7million.ForthesixmonthsendedJuly31,2017,werecordedagainonforeignexchangetransactionsof$0.8million.Todate,wehavenothadaformalhedgingprogramwithrespecttoforeigncurrency,butwemaydosointhefutureifourexposuretoforeigncurrencyshouldbecomemoresignificant.A10%increaseordecreaseincurrentexchangeratescouldhavea$1.1millionimpactonourfinancialresults.

Critical Accounting Policies and Estimates

OurconsolidatedfinancialstatementsarepreparedinaccordancewithgenerallyacceptedaccountingprinciplesintheUnitedStates(GAAP).Thepreparationofthesefinancialstatementsrequiresourmanagementtomakeestimatesandassumptionsthataffectthereportedamountsofassets,liabilities,revenue,costsandexpensesandrelateddisclosures.Ourestimatesarebasedonourhistoricalexperienceandonvariousotherfactorsthatwebelievearereasonableunderthecircumstances,theresultsofwhichformthebasisformakingjudgmentsaboutthecarryingvalueofassetsandliabilitiesthatarenotreadilyapparentfromothersources.Actualresultsmaydifferfromthesejudgmentsandestimatesunderdifferentassumptionsorconditionsandanysuchdifferencesmaybematerial.Webelievethatoursignificantaccountingpolicies,whicharediscussedinNote2toourconsolidatedfinancialstatements,andtheaccountingpoliciesdiscussedbelow,involveagreaterdegreeofcomplexity,involvingmanagement’sjudgmentsandestimates.Accordingly,thesearethepolicieswebelievearecriticaltounderstandingourfinancialconditionandhistoricalandfutureresultsofoperations.

Revenue Recognition

Wegeneraterevenuefromsubscriptionsandservices.Subscriptionarrangementsaretypicallyonetothreeyearsinlengthbutmaybeuptosevenyearsinlimitedcases.Arrangementswithourcustomerstypicallydonotincludegeneralrightsofreturn.Incrementaldirectcostsincurredrelatedtotheacquisitionororiginationofacustomercontractareexpensedasincurred.

Revenuerecognitioncommenceswhenallofthefollowingcriteriaaremet:(i)persuasiveevidenceofanarrangementexists;(ii)deliveryhasoccurred;(iii)thefeeisfixedordeterminable;and(iv)collectionisprobable.

Subscription revenue

Subscriptionrevenuerelatestoterm(ortime‑based)subscriptionagreementsforbothopensourceandproprietarysoftware.Subscriptionsincludeinternet,emailandphonesupport,bugfixes,andtherighttoreceiveunspecifiedsoftwareupdatesandupgradesreleasedwhenandifavailableduringthesubscriptionterm.Revenueforsubscriptionarrangementsisrecognizedratablyoverthecontractualtermofthearrangementbeginningonthedateaccesstothesubscriptionismadeavailabletothecustomer.

Services revenue

Servicesrevenuerelatestoprofessionalservicesfortheimplementationanduseofoursubscriptions,trainingandeducationservicesandrelatedreimbursabletravelcosts.

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Fortimeandmaterialsandfixedfeearrangements,revenueisrecognizedastheservicesareperformedoruponacceptance,ifapplicable.Formilestone‑basedarrangements,revenueisrecognizeduponacceptanceorsubsequenttocompletionanduponthelapseofanyacceptanceperiod.

RevenuefortrainingandeducationservicesisrecognizedupondeliveryexceptforOn‑DemandTraining,whichisrecognizedratablyoverthecontractualterm.

Multiple-element arrangements

Arrangementswithourcustomersgenerallyincludemultipleelements(e.g.,subscriptionandservices).Weallocaterevenuetoeachelementofthearrangementbasedonvendor‑specificobjectiveevidenceofeachelement’sfairvalue(VSOE)whenwecandemonstratesufficientevidenceofthefairvalue.VSOEforelementsofanarrangementisbaseduponthenormalpricinganddiscountingpracticesforthoseelementswhensoldseparatelyonastand‑alonebasis.

WehaveestablishedVSOEforsomeofourservices.IfVSOEforoneormoreundeliveredelementsdoesnotexist,revenuerecognitiondoesnotcommenceuntildeliveryofboththesubscriptionandserviceshavecommenced,orwhenVSOEoftheundeliveredelementshasbeenestablished.Oncerevenuerecognitioncommences,revenueforthearrangementisrecognizedratablyoverthelongestserviceperiodinthearrangement.

Reseller arrangements

Wealsorecognizesubscriptionrevenueforsalesthroughresellersorotherindirectsaleschannels.Subscriptionrevenuefromthesesalesisgenerallyrecognizeduponsell‑throughtoanendusercustomer.Subscriptionrevenuefromthesesalesdoesnotcommenceuntilcashiscollectedwherepaymentstousarebelievedtobecontingentuponpaymentbytheendusertothereseller.

Deferred revenue

Deferredrevenueconsistsofamountsbilledtoorcollectedfromcustomersunderabindingagreementprovideddeliveryoftherelatedsubscriptionandserviceshascommenced.

Business Combinations, Goodwill and Intangible Assets

Weallocatethefairvalueofpurchaseconsiderationinabusinesscombinationtotangibleassets,liabilitiesassumedandintangibleassetsacquiredbasedontheirestimatedfairvalues.Theexcessofthefairvalueofpurchaseconsiderationoverthefairvaluesoftheseidentifiableassetsandliabilitiesisallocatedtogoodwill.Theallocationofthepurchaseconsiderationrequiresmanagementtomakesignificantestimatesandassumptions,especiallywithrespecttointangibleassets.Theseestimatescaninclude,butarenotlimitedto,futureexpectedcashflowsfromacquiredcustomersandacquiredtechnologyfromamarketparticipantperspective,usefullivesanddiscountrates.Management’sestimatesoffairvaluearebaseduponassumptionsbelievedtobereasonablebutwhichareinherentlyuncertainandunpredictable,and,asaresult,actualresultsmaydifferfromestimates.Duringthemeasurementperiod,whichisuptooneyearfromtheacquisitiondate,wemayrecordadjustmentstotheassetsacquiredandliabilitiesassumedwiththecorrespondingoffsettogoodwill.Upontheconclusionofthemeasurementperiod,anysubsequentadjustmentsarerecordedtoearnings.

Weassessgoodwillforimpairmentatleastannuallyandwhenevereventsorchangesincircumstancesindicatethatthecarryingvalueoftheassetmaynotberecoverable.Wetestgoodwillusingthetwo‑stepprocess.Inthefirststep,wecomparethecarryingamountofthereportingunittothefairvaluebasedonthefairvalueofourcommonstock.Ifthefairvalueofthereportingunitexceedsthecarryingvalue,goodwillisnotconsideredimpairedandnofurthertestingisrequired.Ifthecarryingvalueofthereportingunitexceedsthefairvalue,goodwillispotentiallyimpairedandthesecondstepoftheimpairmenttestmustbeperformed.Inthesecondstep,wewouldcomparetheimpliedfairvalueofthegoodwilltoitscarryingamounttodeterminetheamountofimpairmentloss,ifany.

Acquiredfinite‑livedintangibleassetsareamortizedovertheirestimatedusefullives.Weevaluatetherecoverabilityofourintangibleassetsforpossibleimpairmentwhenevereventsorcircumstancesindicatethatthecarryingamountofsuchassetsmaynotberecoverable.Recoverabilityoftheseassetsismeasuredbyacomparison

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ofthecarryingamountstothefutureundiscountedcashflowstheintangibleassetsareexpectedtogenerate.Ifsuchreviewindicatesthatthecarryingamountofourintangibleassetsisnotrecoverable,thecarryingamountofsuchassetsisreducedtofairvalue.Wehavenotrecordedanysuchimpairmentchargeduringtheperiodspresented.

Stock-based Compensation

Werecognizestock‑basedcompensationexpenseforallstock‑basedpayments.Employeestock‑basedcompensationcostisestimatedatthegrantdatebasedonthefairvalueoftheequityforfinancialreportingpurposesandisrecognizedasexpense,netofestimatedforfeitures,overtherequisiteserviceperiod.

WecalculatethefairvalueofoptionsbasedontheBlack‑Scholesoption‑pricingmodel.TheBlack‑Scholesmodelrequirestheuseofvariousassumptionsincludingexpectedoptionlifeandexpectedstockpricevolatility.Weestimatetheexpectedtermforstockoptionsusingthesimplifiedmethodduetothelackofhistoricalexerciseactivity.Thesimplifiedmethodcalculatestheexpectedtermasthemidpointbetweenthevestingdateandthecontractualexpirationdateoftheaward.Weestimatevolatilityusingvolatilitiesofagroupofpubliccompaniesinasimilarindustry,stageoflifecycle,andsize.Theinterestrateisderivedfromgovernmentbondswithasimilartermtotheoptiongranted.Wehavenotdeclarednordoweexpecttodeclaredividends.Therefore,thereisnodividendimpactonthevaluationofoptions.Weusethestraight‑linemethodforemployeeexpenseattributionforstockoptions.

WehavegrantedRSUstoouremployeesandmembersofourboardofdirectorsunderthe2008Plan.TheemployeeRSUsvestuponthesatisfactionofbothaservice‑basedvestingconditionandaliquidityevent‑relatedperformancevestingcondition.Theservice‑basedconditionforthemajorityoftheseawardsisgenerallysatisfiedpro‑rataoverfouryears.Theliquidityeventrelatedperformanceconditionissatisfiedupontheoccurrenceofaqualifyingliquidityevent,suchastheeffectivedateofaninitialpublicoffering,orsixmonthsfollowingtheeffectivedateofaninitialpublicoffering.DuringthequarterendedApril30,2017,themajorityofRSUsweremodifiedsuchthattheliquidityeventrelatedperformanceconditionissatisfiedupontheeffectivedateofaninitialpublicoffering,ratherthansixmonthsfollowinganinitialpublicoffering.ThemodificationestablishedanewmeasurementdateforthesemodifiedRSUs.Theliquidityeventrelatedperformanceconditionisviewedasaperformancebasedcriterionforwhichtheachievementofsuchliquidityeventisnotdeemedprobableforaccountingpurposesuntiltheeventoccurs.TheliquidityeventrelatedperformanceconditionwasachievedforthemajorityofourRSUsandbecameprobableofbeingachievedfortheremainingRSUsonApril27,2017,theeffectivedateofourinitialpublicoffering.Werecognizedstockbasedcompensationexpenseusingtheacceleratedattributionmethodwithacumulativecatchupofstockbasedcompensationexpenseintheamountof$181.5millionattributabletoservicepriortosucheffectivedate.SharessubjecttoRSUsinwhichtheliquidityevent‑relatedperformanceconditionwassatisfiedupontheeffectivedateoftheinitialpublicofferingwillbeissuedonthepricingdateofthisoffering.

Stock‑basedcompensationexpenseisrecordedbasedonawardsthatareultimatelyexpectedtovest,andsuchexpensehasbeenreducedforestimatedforfeitures.Whenestimatingforfeitures,weconsidervoluntaryterminationbehaviorsaswellastrendsoftheactualoptionforfeitures.

Wealsorecordstock‑basedcompensationexpensewhenaholderofaneconomicinterestinourcompanypurchasessharesfromanemployeeforanamountinexcessofthefairvalueofthecommonstockatthetimeofthepurchase.Werecognizeanyexcessvaluetransferredinthesetransactionsasstock‑basedcompensationexpenseinthestatementofoperations.

WeestimatedthefairvalueofoptionsandotherequityawardsgrantedtononemployeesusingtheBlack‑Scholesmethod.Theseawardsaresubjecttoperiodicre‑measurementovertheperiodduringwhichservicesarerendered.Werecognizethestock‑basedcompensationexpensefornon‑employeeoptionsandotherequityawardsoverthevestingperiodusingthestraight‑linemethod.

Common Stock Valuations

Priortoourinitialpublicoffering,giventheabsenceofapublictradingmarketofourcommonstock,andinaccordancewiththeAmericanInstituteofCertifiedPublicAccountantsPracticeGuide,ValuationofPrivatelyHeld

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CompanyEquitySecuritiesIssuedasCompensation,ourboardofdirectorsexercisedreasonablejudgmentandconsiderednumerousandsubjectivefactorstodeterminethebestestimateoffairvalueofourcommonstock,including,butnotlimitedto:

• relevantprecedenttransactionsinvolvingourcapitalstock;

• contemporaneousvaluationsperformedbythirdpartyspecialists;

• rights,preferences,andprivilegesofourredeemableconvertiblepreferredstockrelativetothoseofourcommonstock;

• actualoperatingandfinancialperformance;

• currentbusinessconditionsandfinancialprojections;

• likelihoodofachievingaliquidityevent,suchasaninitialpublicofferingorasaleofourbusiness;

• thelackofmarketabilityofourcommonstock,andtheilliquidityofstock‑basedawardsinvolvingsecuritiesinaprivatecompany;

• recentsecondarystocksales;

• marketmultiplesofcomparablepublicly‑tradedcompanies;

• stageofdevelopment;

• industryinformationsuchasmarketsizeandgrowth;and

• U.S.andglobalcapitalandmacroeconomicconditions.

Wedeterminedthefairvalueofourcommonstockforfinancialreportingpurposes,takingintoaccountthefactorsdescribedabove,usingacombinationofvaluationmethodologieswithvaryingweightingappliedtoeachmethodology.OnevaluationmethodologyusedwastheProbabilityWeightedExpectedReturnMethod(PWERM)underwhichthevalueofourcommonstockwasestimatedbaseduponananalysisofvaluesfortheCompanyassuminganinitialpublicofferingasapossiblefutureevent.Weappliedadiscountforlackofmarketabilitytoaccountforalackofaccesstoanactivepublicmarket.

InadditiontothePWERM,weutilizedthearm’s‑lengthtransactionsofourequitysecuritiesinthesecondarymarketandaswellasatenderoffercompletedinfiscal2016.Theweightingusedineachperiodforthesecondarytransactionsforpurposesofdeterminingthevaluationofourcommonstockconsideredfactorsincludingthenumberofsharessold,relationshipofthepartiesinvolved,timingofthetransactionsinrelationtothevaluationdateandourfinancialcondition.

Followingourinitialpublicoffering,itisnolongernecessarytodeterminethefairvalueofourcommonstockusingthesevaluationapproachesassharesofourcommonstockaretradedinthepublicmarket.

Basedonthepublicofferingpriceof$16.45pershare,theaggregateintrinsicvalueofstockoptionsoutstandingasofJuly31,2017was$262.6million,with$256.6millionrelatedtovestedstockoptions,andtheaggregateintrinsicvalueofRSUsoutstandingasofJuly31,2017was$398.1million.

JOBS Act Accounting Election

Weareanemerginggrowthcompany,asdefinedintheJumpstartOurBusinessStartupsActof2012,ortheJOBSAct.UndertheJOBSAct,emerginggrowthcompaniescandelayadoptingneworrevisedaccountingstandardsissuedsubsequenttotheenactmentoftheJOBSActuntilsuchtimeasthosestandardsapplytoprivatecompanies.Wehaveelectedtousethisextendedtransitionperiodforcomplyingwithneworrevisedaccountingstandardsthathavedifferenteffectivedatesforpublicandprivatecompaniesuntiltheearlierofthedatewe(i)arenolongeranemerginggrowthcompanyor(ii)affirmativelyandirrevocablyoptoutoftheextendedtransition

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periodprovidedintheJOBSAct.Asaresult,ourfinancialstatementsmaynotbecomparabletocompaniesthatcomplywithneworrevisedaccountingpronouncementsasofpubliccompanyeffectivedates.

Recent Accounting Pronouncements

Recently Adopted Accounting Standards

InMarch2016,theFinancialAccountingStandardsBoard(FASB)issuedASUNo.2016‑09,Compensation – Stock Compensation (Topic 718):Improvements to Employee Share‑Based Payment Accounting ,orASU2016‑09,whichsimplifiestheaccountingandreportingofshare‑basedpaymenttransactions,includingadjustmentstohowexcesstaxbenefitsandpaymentsfortaxwithholdingsshouldbeclassifiedandprovidestheelectiontoeliminatetheestimateforforfeitures.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2016,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017,andinterimperiodswithinannualperiodsbeginningafterDecember15,2018.Earlyadoptionispermittedforanyentityinanyinterimorannualperiodforwhichfinancialstatementshavenotbeenissuedormadeavailableforissuance.Wehaveearlyadoptedthisstandardinthefirstquarteroffiscal2018.Asaresultofthisadoption,wehaveelectedtoaccountforforfeituresastheyoccur.Theadoptionofthisstandarddidnothaveamaterialimpactonourconsolidatedfinancialstatements.

Recently Issued Accounting Standards

InMay2014,theFASBissuedASUNo.2014‑09,Revenue from Contracts with Customers (Topic 606) ,orASU2014‑09,whichamendedtheexistingFASBAccountingStandardsCodification.ASU2014‑09establishesaprincipleforrecognizingrevenueuponthetransferofpromisedgoodsorservicestocustomers,inanamountthatreflectstheexpectedconsiderationreceivedinexchangeforthosegoodsorservicesandalsoprovidesguidanceontherecognitionofcostsrelatedtoobtainingandfulfillingcustomercontracts.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018,andinterimperiodswithinannualperiodsbeginningafterDecember15,2019.Earlyadoptionispermitted,butmaynotbeadoptedbyusanyearlierthanFebruary1,2017.

Wearecurrentlyintheprocessofassessingtheadoptionmethodology,whichallowsASU2014‑09tobeappliedeitherretrospectivelytoeachpriorperiodpresentedorwiththecumulativeeffectrecognizedasofthedateofinitialapplication.Ourfinaldeterminationwilldependonanumberoffactors,suchasthesignificanceoftheimpactofthenewstandardonourfinancialresults,systemreadiness,includingthatofsoftwareprocuredfromthird‑partyproviders,andourabilitytoaccumulateandanalyzetheinformationnecessarytoassesstheimpactonpriorperiodfinancialstatements,asnecessary.

WearealsocurrentlyevaluatingtheimpactASU2014‑09willhaveonourconsolidatedfinancialstatements.WeareintheinitialstagesofourevaluationoftheimpactofASU2014‑09onouraccountingpolicies,processes,andsystemrequirements.Wehaveassignedinternalresourcesinadditiontoengagingthirdpartyserviceproviderstoassistintheevaluation.WhilewecontinuetoassessallpotentialimpactsunderASU2014‑09,thereisthepotentialforsignificantimpactstothetimingofourrevenuerecognitionandcontractacquisitioncosts,suchassalescommissions.AccountingforsalescommissionsunderASU2014‑09isdifferentthanourcurrentaccountingpolicywhichistoexpensesalescommissionsasincurredwhereassuchcostswillbedeferredandamortizedunderASU2014‑09.Additionally,wepreliminarilybelievethattheamortizationperiodforsuchdeferredcommissioncostswillbelongerthanthecontractterm,asASU2014‑09requiresentitiestodeterminewhetherthecostsrelatetospecificanticipatedcontracts.

WhilewecontinuetoassessthepotentialimpactsofASU2014‑09,includingtheareasdescribedabove,andanticipateASU2014‑09couldhaveamaterialimpactonourconsolidatedfinancialstatements,wedonotknoworcannotreasonablyestimatethequantitativeimpactonourfinancialstatementsatthistime.

InFebruary2016,theFASBissuedASUNo.2016‑02,Leases (Topic 842) ,orASU2016‑02,whichrequireslesseestorecordmostleasesontheirbalancesheetsbutrecognizetheexpensesontheirincomestatementsinamannersimilartocurrentpractice.ASU2016‑02statesthatalesseewouldrecognizealeaseliabilityforthe

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obligationtomakeleasepaymentsandaright‑to‑useassetfortherighttousetheunderlyingassetfortheleaseterm.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2019,andinterimperiodswithinannualperiodsbeginningafterDecember15,2020.Earlyadoptionispermitted.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InJune2016theFASBissuedASUNo.2016‑13,Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on FinancialInstruments ,orASU2016‑13.ASU2016‑13requiresthemeasurementofallexpectedcreditlossesforfinancialassetsheldatthereportingdatebasedonhistoricalexperience,currentconditions,andreasonableandsupportableforecasts.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2019,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2020,includinginterimperiodswithinthatreportingperiod.Earlieradoptionispermittedinourfirstinterimperiodinfiscal2020.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InAugust2016,theFASBissuedASUNo.2016‑15,Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments ,orASU2016‑15.ASU2016‑15identifieshowcertaincashreceiptsandcashpaymentsarepresentedandclassifiedintheStatementofCashFlows.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018,andinterimperiodswithinannualperiodsbeginningafterDecember15,2019.Thisstandardshouldbeappliedretrospectivelyandearlyadoptionispermitted,includingadoptioninaninterimperiod.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InOctober2016,theFASBissuedASUNo.2016-16,Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ,orASU2016-16.ASU2016-16requiresentitiestorecognizetheincometaxconsequencesofanintra-entitytransferofanasset,otherthaninventory,whenthetransferoccurs.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018.Earlyadoptionispermittedasofthebeginningofanannualperiod.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InJanuary2017,theFASBissuedASUNo.2017‑04,Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, orASU2017‑04.ASU2017‑04simplifieshowanentityisrequiredtotestgoodwillforimpairmentbyeliminatingStep2fromthegoodwillimpairmenttest.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2019,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2021.EarlyadoptionispermittedforinterimorannualgoodwillimpairmenttestsperformedontestingdatesafterJanuary1,2017.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InMay2017,theFASBissuedASUNo.2017-09,Compensation -Stock Compensation (Topic 718): Scope of Modification Accounting ,orASU2017-09,whichclarifieswhentoaccountforachangetothetermsorconditionsofashare-basedpaymentawardasamodification.UnderASU2017-09,modificationaccountingisrequiredonlyifthefairvalue,thevestingconditions,ortheclassificationoftheaward(asequityorliability)changesasaresultofthechangeintermsorconditions.ThisstandardiseffectiveforallentitiesforannualreportingperiodsbeginningafterDecember15,2017,includinginterimperiodswithinthatreportingperiod.Earlyadoptionispermitted.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

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BUSINESS

Overview

Clouderaempowersorganizationstobecomedata‑drivenenterprisesinthenewlyhyperconnectedworld.Wehavedevelopedthemodernplatformformachinelearningandanalytics,optimizedforthecloud.Wehaveachievedthispositionthroughextensivecollaborationwiththeglobalopensourcecommunity,continuousinnovationindatamanagementtechnologiesandbyleveragingthelatestadvancesininfrastructureincludingthepubliccloudfor“bigdata”applications.Ourpioneeringhybridopensourcesoftware(HOSS)modelincorporatesthebestofopensourcewithourrobustproprietarysoftwaretoformanenterprise‑gradeplatform.Thisplatformdeliversanintegratedsuiteofcapabilitiesfordatamanagement,machinelearningandadvancedanalytics,affordingcustomersanagile,scalableandcosteffectivesolutionfortransformingtheirbusinesses.Ourplatformenablesorganizationstousevastamountsofdatafromavarietyofsources,includingtheInternetofThings(IoT),tobetterserveandmarkettotheircustomers,designconnectedproductsandservicesandreduceriskthroughgreaterinsightfromdata.Avibrantecosystemhasdevelopedaroundourplatform,andagrowingrangeofapplicationsisbeingbuiltonit.Webelievethatoursolutionisthemostwidelyadoptedbigdataplatform.

Theworldisrapidlybecominginterconnectedthroughmobile,social,internetandsensoractivity.InternationalDataCorporation(IDC)estimatesthatby2020therewillbe30billioninternet‑connectedandmobiledevices.Additionally,thequantityofinformationproducedperyearisexpectedtogrow,withIDCestimatingthatapproximately440timesmoreinformationwillbecreatedin2020thanin2005.Developershavecreateddata‑intensiveapplicationstotakeadvantageofallofthisinformation.Traditionaldatamanagementtechnologiescannottechnologicallyoreconomicallycapturethisdataorsupporttheseapplications.Enterprisesarechallengedtomanageanduserapidlygrowingquantitiesofdataofnewandvaryingtypes.Theyarealsooperatinginincreasinglycompetitiveanddemandingregulatoryenvironments.AccordingtostudiesquotedintheHarvardBusinessReview,lessthanhalfofanorganization’sstructureddataisactivelyusedinmakingdecisions,lessthan1%ofitsunstructureddataisanalyzedorusedatall,morethan70%ofemployeeshaveaccesstodatatheyshouldnotand80%ofanalysts’timeisspentsimplydiscoveringandpreparingdata.Inordertoachievetheirbusinessobjectives,enterprisesmustadoptinformation‑centricstrategiesandadata‑drivenapproachtoproblemsolving.Organizationsacrossallindustriesneedtodeveloptheabilitytoactquicklyandcost‑effectivelyonmassiveamountsofdatainanyformfromanysourcetogaininsight,tocompeteeffectivelyandtocomplywithlawsandregulations.Theyneedtomanageallavailabledata,whereveritmayoriginateorreside.Theyneedamodernopendataarchitecturebuiltonthelatestopensourcetechnologiesanddesignedforpubliccloudinfrastructure.

Inresponse,wehavecreatedoursoftwareplatformandpioneeredthehybridopensourcesoftwaremodel.HOSScombinesthebestopensourcesoftwarewithproprietarysoftwaretomeettheexactingrequirementsoflargeenterprises.Byintegratingrobustproprietarysoftwarewithouropensourceplatform,builtontheleadingdatamanagementandanalyticstechnologies,wedeliversubstantiallygreatervaluetocustomersinmanaging,operatingandsecuringtheirdataanddataarchitectures.OurHOSSmodelalsomeaningfullydifferentiatesoursolutionsfromthoseofourcompetitors,includingopensource“freeriders”whotakefrom,butdonotcontributeto,theopensourcecommunityatlarge.Thisdifferentiationalsobuildslong‑livedcustomerrelationshipsandgeneratestherevenuetosupportsustainedinnovation.

Ourscale‑outdistributedarchitecturedelivershighperformanceoninexpensiveindustry‑standardhardwareorcloudinfrastructure.Weallowenterprisestooperate,manageandmoveworkloadsacrossmultiplearchitectures,mixingon‑premisesandcloudenvironments,includingallmajorpubliccloudinfrastructureproviders–AmazonWebServices,MicrosoftAzureandGoogleCloudPlatform–aswellasmanagedserviceproviders(MSPs).Wealsoenableenterprises’“multi‑cloud”strategies,allowingthemtomoveworkloadsfromthedatacentertothepubliccloud,amongpubliccloudvendors,andbackagain,thusavoidingcloudlock‑in.Inaddition,ourcustomersdeploy,configureandmonitoralltheirworkloadsatscaleacrosstheseenvironmentsfroma“singlepaneofglass.”Thisflexibilityallowscustomerstoconstantlydetermineandimplementthemostcost‑efficientstrategies.AsofJuly31,2017,approximately21%ofourGlobal8000customersrunourplatforminthecloud.

Themarketfornext‑generationdatamanagement,machinelearningandadvancedanalyticsislargeandrapidlygrowingastheworldincreasinglyconnects.IDCestimatesthatthetotalspendonbigdataandbusinessanalytics

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relatedhardware,softwareandserviceswillgrowatan11.9%compoundannualgrowthratetomorethan$210.0billionby2020.Ourplatformcurrentlyaddressesthreenewtransformativemarketswithinbigdataandbusinessanalytics:(i)DynamicDataManagementSystems;(ii)Cognitive/AISystemsandContentAnalyticsSoftware;and(iii)AdvancedandPredictiveAnalyticsSoftware.IDCestimatesthatinaggregatethesemarketswillgrowfrom$10.6billionin2016to$27.7billionin2021atacombinedcompoundannualgrowthrateof21.2%.Beyondthesenewmarkets,ourplatformcurrentlyaddressesandisdisruptingtraditionalmarkets,includingasignificantportionoftheRelationalDatabaseManagementSystemsandNon‑RelationalDatabaseManagementSystemsmarkets.AddingtogetherIDC’sestimatesofthesenewandtraditionalmarkets,webelieveourtotaladdressableopportunityincludingtheseadditionalmarketsisexpectedtoreach$72.7billionby2021.

Weofferoursoftwareplatformonasubscriptionbasisandfocusoursellingeffortsonthelargest8,000corporateenterprisesglobally(Global8000)aswellaslargepublicsectororganizations.Wetargettheseorganizationsbecausetheycaptureandmanagethemajorityoftheworld’sdataandoperatehighlycomplexITenvironments.Theseorganizationsarelikelytorealizethegreatestvaluefromourenterprise‑gradeplatform.Wehaveachievedsignificantgrowthandglobalscaleinarelativelyshortperiodoftime,andasofJuly31,2017,wehaveapproximately562Global8000customers.ForthefiscalyearendedJanuary31,2017andthesixmonthsendedJuly31,2017,revenuefromourGlobal8000represented73%and74%oftotalrevenue,respectively,basedontheGlobal8000constituentsasofMay1,2017.Forfiscal2017andthesixmonthsendedJuly31,2017,revenuefromourpublicsectorcustomers(includinglargepublicsectorcustomers)represented10%and9%oftotalrevenue,respectively.Ourcustomerscontinuetoexpandtheirusageofourplatform.Thenetexpansionrateforoursubscriptionrevenuewas140%asofJuly31,2017.Agrowing,vibrantecosystemhasdevelopedaroundourplatform,andmanythird‑partydevelopershaveprimarilystandardizedonit,buildingmorethan100industry-specificusecases,orapplications,usingourproprietarytechnology.WerefertotheseasPartnerSolutions.Aspartofthisecosystem,wehavedevelopedastrategicpartnershipwithIntelCorporation,orIntel,tooptimizeoursoftwareforusewithIntelprocessorsandarchitecture.Asaresultofourjointdedicationtothispartnership,ourplatformachievesdifferentiatedperformanceonIntelarchitecturetoday,andisexpectedtoachievedifferentiatedperformanceonfutureIntelplatformtechnologies.Wewillfurtherexpandourcustomeropportunitythroughthecontinuedgrowthinusecasesandpackagedsolutions,theexpansionofourpartnerecosystemandtheproliferationofskills,drivenbyeaseofuseandacceleratingadoptionofthecloud.See“Market,IndustryandOtherData”forhowwedefineGlobal8000,largepublicsectororganizationsandcalculateournetexpansionrate.

ForourfiscalyearsendedJanuary31,2016andJanuary31,2017,ourrevenuewas$166.0millionand$261.0million,respectively,representingyear‑over‑yeargrowthinrevenueof57%forourmostrecentfiscalyear.Overthesameperiod,operatingcashoutflowsincreasedfrom$90.5millionto$116.6millionwhileournetlosseswere$203.1millionand$187.3million,respectively,whichincludes$63.6millionand$21.7million,respectively,ofstock‑basedcompensationexpense,andanon‑cashchargeof$21.6millioninconnectionwiththedonationofcommonstocktotheClouderaFoundationforfiscal2017.ForthesixmonthsendedJuly31,2016and2017,ourrevenuewas$120.9millionand$169.4millionrespectively,representingperiod‑over‑periodgrowthinrevenueof40%.Overthesameperiod,operatingcashoutflowsdecreasedfrom$52.1millionto$17.9millionwhileournetlosseswere$81.8millionand$286.5million,respectively,whichincludes$11.2millionand$230.5million,respectively,ofstock‑basedcompensationexpense.

Industry Background

Successfulorganizationshavealwayscollectedandanalyzeddata.Theyhaveusedittounderstandtheircustomers,designandbuildtheirproducts,andaddressopportunitiesandmanageriskintheirbusinesses.

Today,largeorganizationsareawashinvastlymoredatathaneverbefore.Theycollectreal‑timeandstreamingdataoneventsandtransactions,socialandinteractiondataabouttheircustomers,newsandmarketdataaboutthemselvesandtheircompetition,andmuchmore.Theyarealsooperatinginincreasinglycompetitiveanddemandingregulatoryenvironments.Toachievetheirbusinessobjectives,theymustcapture,secure,prepare,analyzeandactonallofthatdataquickly.

Thisfloodofdataoverwhelmsdatamanagementsystemscreatedinearlierdecades.Thosesystemsweredesignedforthedatavolumesandfortheanalyticalproblemsofanearlierday.Theywereneverintendedtohandle

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thethousand‑foldorgreaterincreaseinvolume,nortoday’scombinationandcomplexityofdataandnewdatatypes.Thosesystemspredatedpowerfulnewanalytictechniquessuchasmachinelearningandnaturallanguageprocessing.

Thefirstorganizationsconfrontedwiththiscombinationofvolume,complexityandanalyticchallengeswereweb‑scaleconsumerinternetcompanieslikeGoogle,FacebookandYahoo.Thosewebpioneerscreatedanewsoftwarearchitectureandacollectionofopensourcesoftwareprojectstosolvetheirdataproblems.Thatsoftwarewassophisticatedandpowerful,butdemandedexceptionaltechnicalandoperationalskillofitsusers.

Today,boardrooms,C‑suitesandline-of-businessleadersacrossallindustriesarefocusedondevelopingtheabilitytousevastamountsofdatafromavarietyofsourcestobetterservecustomers,designproductsandservicesandmanagerisk.Theirorganizationsneedtechnologythatgivesthembetterinsightsthanlegacysystemsallow.Theyneednewsystemstocompeteeffectivelyandtocomplywiththelawsandregulationsthatgovernthem.Theyneedanenterprise‑gradesolutiontomanageandactonallavailabledata,whereveritmayoriginateorreside.Theyneedthepowerandsophisticationoftheweb‑scaleconsumerinternetleaders,packagedforconsumptionbyordinaryenterprises.Enterprisesrequireamoderndatamanagement,machinelearningandanalyticsplatform.

Factors affecting the development of next ‑‑ generation data management, machine learning and advanced analytics

Amodernplatformformachinelearningandanalyticsisvaluablebecausemoredataoftenyieldsbetteranswerstohardquestions.Itenablesenterprisestolookatproblemsatmuchhigherresolution.Itpermitsqueriestoexaminenotjustthelastmonthorquarter,butthelastyearordecadeofcustomerbehavior.Usingpowerfulmachinelearningalgorithms,itcanexaminehistoricaldataandfindpatternsthatmoreaccuratelypredictfuturetrends.Suchaplatformallowsenterprisestoextractmorevaluefromtheirdataandeffectdigitaltransformation.

Themainfactorsdrivingcomplexityandchallengesinextractingvaluefromdataare:

• The rise of the interconnected world and the Internet of Things (IoT). Anincreasinglyconnectedworldisacceleratingthepaceofdatageneration.Moreandmoredataiscreatedfrommobile,socialandinternetconnecteddevices,andbusinessactivityisincreasinglydigitallyinstrumented.Newtypesofsensorscontinuetoproliferate,andtheyareusuallyconnectedtoanetworktoday.Asaresult,todaywehaveconnectedhomes,connectedcars,connectedpatients,connectedmachinesandconnectedsupplychainsthatexpandthetypesofdataproduced,includingstreaming,image,audioandvideo.By2020,IDCestimatesthattherewillbe30billioninternet‑connectedandmobiledevices.

• The explosion of new data. Dataiscreatedinsharplyincreasingvolumesasenterprisesseektodigitallytransform.Enterprisesaredigitalizinganincreasingnumberofbusinessactivitiestoimproveandtransformoperations,functionsandprocesses,producingdataatanunprecedentedscale.IDCestimatesthatapproximatelyeighttimesasmuchinformationwascreatedin2015thanin2010and90timesasmuchinformationwascreatedin2015thanin2005.Thisquantityofinformationisexpectedtocontinuetogrow,withIDCestimatingthatapproximately440timesmoreinformationwillbecreatedin2020thanin2005.

• The proliferation of machine learning and artificial intelligence. Toidentifytrendsinhistoricaldataandtorecognizeeventsincurrentdataandpredicttheminthefuture,organizationsprocesslargedatasetswithadvancedalgorithmsthatrecognizethetrendsandthatimprovewithexperience.Thiscapabilityiscommonlyreferredtoasmachinelearning.Theriseofbigdataenhancesthequalityofmachinelearningalgorithmsbyprovidinglarger,morecomprehensivedatasetsuponwhichtolearnandimprove.Greateravailabilityofdata,lowercomputecosts,significantbusinessopportunityandgreateroperationalcomplexityareincreasingthedemandformachinelearningandartificialintelligenceapplications.Machinelearningandartificialintelligencearebeingusedinabroadanddiversearrayofapplicationssuchasfraudprevention,mediaplacement,cropplanting,equipmentmaintenance,storemerchandisingandcybersecurity.

• The modernization of enterprise infrastructure. Organizationsareincreasinglyupdatingtheirinfrastructuretotakeadvantageofthelatesttechnologicaldevelopmentsandmeetdemandsoftheir

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executivemanagement,employeesandcustomers.Inadditiontotheregularcycleofnewhardwareandsoftwarepurchasesinthedatacenter,therearetwocoretrendsthatlargeenterprisesareembracingtoday:

– Open source software. Opensourcesoftwareisplayinganincreasinglycentralroleinenterprises’technologyarchitectures.Ithasproliferatedasdevelopersandbusinessownersembraceitsdistributedandcollaborativeapproachtosoftwaredevelopment.Thisapproachacceleratesinnovationavailabletoenterprises,vendorsandcommunityparticipants.Enterprisescanquicklyadvancetheirinfrastructureinitiativesthroughdirectcontributionsorsimplemodificationstoopensourceprojects.Inaddition,enterprisesareespeciallyattractedtoopensourcesoftwareasamechanismforreducingthethreatofvendorlock‑in.Accordingtoa2015marketsurveybyBlackDuckSoftwareandNorthBridgeVenturePartners,morethan78%ofenterprisesrunonopensourcesoftware.

– Public cloud infrastructure. Publiccloudinfrastructureprovidestheabilitytoquicklyspinsystemsupanddownandtodynamicallygrowandshrinktheirprocessingpower.Enticedbythiselasticity,aswellasflexibility,usagepricingandminimalsetuptimeandcosts,organizationsofallsizesareincreasinglyadoptingpubliccloudarchitecturesforstorageandcomputingneeds.Publiccloudisthefastestgrowingtypeofinfrastructuretoday.Maturingpubliccloudserviceshaveequippedtoday’sbusinessleaderswitharangeofITarchitecturealternatives,enhancingtheirabilitytoselecttheoptimalinfrastructurefortheperformanceandcostrequirementsofspecificapplicationsorworkloads,suchasusingcloudinfrastructurefortransientworkloads.

Limitations of Legacy Data Management Technology

Inpriordecades,organizationsboughtdedicatedtechnologytosolvespecificdata‑relatedbusinessproblems.Theyuseddocumentmanagementsystemsforstoringresumesandcontracts,controlsystemsforrunningfactoriesandrelationaldatabasesforback‑officereportingandbilling.Whileeachofthesesystemswasuseful,theywereisolated,notintegrated.Itwasdifficultorimpossibletocombinedatafromthesesystemsforacomprehensiveviewofthebusiness.

Therapidexpansioninthevolumeandvelocityofdatageneratesmoredynamicinformationsets,makingthesespecial‑purposelegacyarchitecturesevenmoreexpensiveandcumbersometouse.Enterprisesneedsystemsthatoperateonall theirdata.TheiranalyticrequirementsdemandthattheyrunnotonlySQL,butalsotheflexible,iterativealgorithmsthatarethebasisformachinelearningapplications.Furthermore,theproliferationofimages,audio,video,geo‑locationdata,clickstreamdataandsensordatacreatesopportunitiesfornewanalysesandapplications.Thesiloedsystemsofthepastareincompatiblewithwhattoday’sorganizationsneedfortoday’sdata:flexibility,scalability,elasticityandagilityfromarichcollectionofintegratedanalyticcapabilitiesandanopenecosystem.

The Evolution of the Open Source Data Management Ecosystem

Web‑scaleconsumerinternetcompanieswereamongthefirsttoencounterthechallengeofprocessingimmensevolumesofdiversedata.Withnocommercialalternative,thesecompaniescreatedthescalablestorageandprocessinginfrastructurethatservesasthefoundationforthemoderndatamanagementandanalyticsplatform.InDecember2004,Googlepublishedawhitepaperdescribingitsapproachfordevelopingsuchaplatform.Independently,twosoftwaredevelopers,DougCuttingandMikeCafarella,werestrugglingtobuildweb‑scalesystemsatthetime.BuildingontheideasbehindGoogle’sapproach,theycreatedthebeginningofanopensourcedatastorageandprocessingsolution.Cuttingnamedthissoftware“Hadoop,”afterastuffedtoyelephantthatbelongedtohisyoungson.

CuttingandCafarellahopedtoinitiateavibrantopensourcecommunityaroundtheirwork,sotheydonatedthecodetotheApacheSoftwareFoundationin2005.Nowknownas“ApacheHadoop,”thissoftwareprojecthasspawnedarichecosystemofopensourceandproprietarysoftwarefornextgenerationdatamanagement.

Hadoopwasoriginallydesignedtoprovidehighperformance,low‑costprocessingofcomplexdataatscale.ItcomprisedtheopensourcetechnologiesknownasHDFSandMapReduce.Sincethen,anopensourcedatamanagementecosystemhasdevelopedthatnowcomprisesmorethan40majorprojects,includingthosetwooriginal

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Hadoopprojects,aswellasSpark,Impala,KuduandKafka.Astheecosystemhasgrown,sohavecomplexityandrisk.Theseprojectstacklecomplementaryproblemsincollecting,processingandanalyzingdata.Together,theyofferunprecedentedpowerandflexibility.Theirproliferation,though,increasesthechallengeforenterprisesthatneedtousethem,astheyaresometimesoverlapping,competingorinconsistentinapproach.Inaddition,someprojectsmaynotbeenterprisequalityoracceptedasopensourcestandards.Withtheconsistentandon‑goingexpansionoftheopensourcedatamanagementecosystem,drivenbytherapidinnovationoftheglobalopensourcecommunity,enterprisescanspendsignificanttimeandresourcesunderstanding,deployingandusingthesetechnologies.

Requirements of the Modern Data Management and Analytics Platform

Organizationsneedamoderndataplatformwith:

• The ability to deploy on-premises or in the public cloud – or both. Manyenterpriseshavedataon‑premisesforlong‑livedworkloadsandrelyonpubliccloudinfrastructurefortransientworkloads.Asaresult,enterprisesrequireasolutionthatprovidestheflexibilitytostoreandanalyzetheirdatainamixedinfrastructureenvironment.Inaddition,enterprisesrequiretheabilitytorunnativelyondifferentpubliccloudplatforms,ormulti‑cloudcapability,sothattheycanchooseamongcompetingpubliccloudplatformsandmoveworkloadsamongthemtoavoidcloudlock‑in.

• Access to the latest open source technologies. Collaboratingacrossbordersandcompanylines,theglobalopensourcesoftwarecommunityinnovatesquickly.Thisinnovationcanleadtocompetingsoftwareprojects,whichcreatescomplexityandriskforenterprisesthatsimplywanttousethebestandmostappropriateopensourcesoftware.Enterprisesneedatrustedpartnertoplayanactiveroleinthecommunity,contributingsignificantlytoopensourcedevelopmentandcontinuouslycuratingthevariousprojectstocreateahighlyintegrated,secureandhigh‑performanceplatform.

• Support for machine learning. Distributedsystemstogetherwithlargeamountsofdataallowenterprisestousemachinelearningtounderstandthepastandtopredictthefuture.Toperformmachinelearning,adataplatformmustsupportflexibleschemaandmultipledatasciencelanguages.Itmustalsosupportanewclassofanalyticalgorithmsasmachinelearningusessophisticatedalgorithmstoexaminedataandtoextractpatterns.Enterprisesrequireamoderndatamanagementandanalyticsplatformthatpowersthealgorithmstoapplymachinelearningtorealbusinessproblemsandrealbusinessdata.

• Enterprise-grade performance, features and functionality. Enterprisesrequireaplatformsuitedtooperatinginhighlycomplextechnology,businessandregulatoryenvironments,including:

– Scalability and performance. Legacydatamanagementsystemsdonotmeettheperformancedemandsofmoderndataapplications.Thesesystemsdependonasingleorlimitednumberofexpensive,centralizedcomputerstohandlestorageandprocessing.HugequantitiesofdataaccessedbymanyusersrunningacombinationofSQLqueries,textsearchesandmachinelearningtechnologiescansimplyoverwhelmlegacysystems.Themoderndataplatformrequiresascale‑outarchitecture–whichcombinesmanysmall,inexpensivecomputersandpoolstheirstorageandprocessingpower–tomeetperformancedemands.

– Operate and manage resources across environments at scale. Asdataandprocessingneedsgrow,enterprisesrequiretechnologythatoffersvisibilityacrosssystemsandworkloadswithoutregardtowhetherthoseassetsaredeployedon‑premisesorinthecloud.Asenterprisesystemsscale,centralizedmonitoringandmanagementinanyinfrastructureenvironmentbecomescriticaltodataarchitectureoperations,aswellastoregulatoryandpolicycompliance.

– Data security and governance. Dataisstrategic,andenterprisesareretainingmoreofitforlonger–evenpermanently.Alargeconcentrationofdatacreatesuniqueandsignificantsecurityconcerns.Businesspolicy,legalandregulatoryregimesimposerulesastowhomayusedata,forwhatpurposesandhowitissafeguarded.Policysetting,enforcementandmonitoringforcompliancepurposesdemanddatagovernancetechnologythatreportsonusage,tracksdatalineageandensures

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thatenterprisescanmeetthestrictprivacyandothercontrolsthatapply.Toappropriatelysafeguarddataandcomplywithlegalandregulatoryrequirements,enterprisesmustensureproperauthentication,authorizationandaccessateverylevel.

– Low total cost of ownership. Theamountofdataavailableforanalysishasgrownexponentially,butITbudgetshavenot.Eveniflegacydatamanagementtechnologiescould addressthechallengesof“bigdata,”theywouldbecostprohibitive.Enterprisesrequiretheabilitytomanagetheirdataarchitectureatscaleandtheflexibilitytousetheinfrastructurethatismostcostefficientandappropriateforeachusecase.

Our Market Opportunity

Themarketfornext‑generationdatamanagement,machinelearningandadvancedanalyticsislargeandrapidlygrowingastheworldincreasinglyconnects.IDCestimatesthatthetotalspendonbigdataandbusinessanalyticsrelatedhardware,softwareandserviceswillgrowatan11.9%compoundannualgrowthratetomorethan$210.0billionby2020.Ourplatformcurrentlyaddressesthreenewtransformativemarketswithinbigdataandbusinessanalytics:(i)DynamicDataManagementSystems;(ii)Cognitive/AISystemsandContentAnalyticsSoftware;and(iii)AdvancedandPredictiveAnalyticsSoftware.Technologieswithinthefirstmarkethelpenterprisescaptureandmanagetheincreasingvolumeandcomplexityofnewdata.Technologieswithinthelattertwomarketshelpenterprisesgenerateinsightsandderivevaluefromtheirdata.IDCestimatesthatinaggregatethesemarketswillgrowfrom$10.6billionin2016to$27.7billionin2021atacombinedcompoundannualgrowthrateof21.2%.

Beyondthesenewmarkets,ourplatformcurrentlyaddressesandisdisruptingtraditionalmarkets,includingasignificantportionoftheRelationalDatabaseManagementSystemsandNon‑RelationalDatabaseManagementSystemsmarkets.Technologieswithinthesemarketsrepresenttraditionalsystemsusedbyenterprisestomanagetheirdata.AddingtogetherIDC’sestimatesofthesenewandtraditionalmarkets,webelieveourtotaladdressableopportunityincludingtheseadditionalmarketsisexpectedtoreach$72.7billionby2021.

Our Solution

Clouderaempowersorganizationstobecomedata‑drivenenterprisesinthenewlyhyperconnectedworld.Wehavedevelopedthemodernplatformformachinelearningandanalytics,optimizedforthecloud.Buildingontheapproachofweb‑scaleconsumerinternetcompanies,wehavecollaboratedwiththeglobalopensourcecommunitytoinnovateanddeliverourcloud‑nativeplatform.Ourscale‑outdistributedarchitecturedelivershighperformanceoninexpensive,industry‑standardhardwareorcloudinfrastructure.Weallowenterprisestooperate,manageandmoveworkloadsacrossmultiplearchitectures,mixingon‑premisesandcloudenvironments,includingallmajorpubliccloudinfrastructureproviders.Webelievethatoursolutionisthemostwidelyadoptedbigdataplatform,withagrowingrangeofapplicationsbeingbuiltonit.

Wehavepioneeredthehybridopensourcesoftwaredevelopmentmodel,orHOSS.Ourmodelisbasedonactiveparticipationandleadershipintheopensourcedatamanagementecosystemandsoftwaredevelopmentprocess,andutilizationoftheverybestopensourcetechnologies.Asauthorsandparticipants,wecontributenewprojectsandenhanceexistingprojects.Wealsoidentifythebestprojectsthataregrowinginpopularityamongdevelopersandinadoptionbyenterprises.Thisinvolvementhelpsusrecognizeandchampionemergingstandards,aswedidwhenweledthemarketbyembracingSparkasacomplementtotheoriginalMapReducedataprocessingengine.

Todelivertheagilityandinnovationofopensourcesoftwaretoourcustomers,ourplatformintegrates26distinctopensourceprojects,18ofwhichwerecreatedbyourengineers.Wecombinethosecuratedopensourceprojectswithourrobustproprietarysoftwaretoformanenterprise‑gradeplatform.Weprovideafullandintegratedsuiteofdatamanagement,machinelearningandadvancedanalyticcapabilities,affordingenterprisesasingleplatformthatisagile,scalableandcosteffectivefortransformingtheirbusinesses.

Webelieveourapproachhasaprofoundimpactbothonourcustomersandontheopensourcecommunity.OurHOSSmodeldeliverssubstantiallygreatervaluetocustomersinmanaging,operatingandsecuringtheirdataand

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dataarchitectures.Inaddition,ourrobustproprietarysoftwaremeaningfullydifferentiatesoursolutionsfromthoseofourcompetitors,includingopensource“freeriders”whotakefrom,butdonotcontributeto,theopensourcecommunityatlarge.Thisdifferentiationdrivestherevenuetosustaininvestmentinfurtherinnovationintheopensourcedatamanagementecosystemtoaddressabroadeningsetofenterprisedataneeds.

Key Benefits and Differentiators

Thesearethekeybenefitsanddifferentiatorsofoursolution:

• Deployable on-premises or in the public cloud – or both. Withouragnosticapproachtoinfrastructure,enterprisesstoreandanalyzetheirdataintheenvironmentthatbestmeetstheirperformanceandefficiencygoals.Oursolutionallowsenterprisestomanagebothlong‑livedandtransientworkloadsacrossenvironments,mixingon‑premisesandpubliccloudinfrastructure,includingallmajorpubliccloudvendors–AmazonWebServices,MicrosoftAzureandGoogleCloudPlatform.Weenableenterprises’multi‑cloudstrategies,allowingthemtomoveworkloadsfromthedatacentertothepubliccloud,amongpubliccloudvendors,andbackagain.Customersmaintainandcontrolaccesstotheirdata,andtheyarebetterabletoobtainattractivetermsandavoidcloudvendorlock‑in.

• Leverages the latest open source innovation . Ourplatformintegratesthelatestinnovationsinopensourcedatamanagementtechnology.Inadditiontoourcontributionstonewprojectinnovationandexistingprojectenhancement,weareabletoleveragethemostsignificantinnovationsofthebroaderglobalcommunity.Forexample,wewerethefirstdataplatformvendortoincorporateSpark,integratingitintoourplatformin2013,enhancingbatchprocessingandenablingreal‑time,streamingandmachinelearningworkloads.ThiscurationandintegrationisacontinuouscommitmentasdemonstratedbyouradoptionofprojectssuchasSolr,Kafka,ImpalaandKudu.Asaresult,weservecustomersbetterandcapitalizeasabusinessonthelatestopensourcetechnologiestodeliverahighlyintegrated,secureandhigh‑performanceplatform.

• Enables machine learning. Ourplatformisuniquelydesignedtoenabletherapidlygrowingdatasciencecommunityandmachinelearningapplications.ThroughourintegrationofSparkandpopulardatasciencelanguageslikePythonandR,ourplatformsupportsbatch,real‑timeandadvancedanalytics.Weprovidethecapabilitiestoreliablyrunmassivelyiterativealgorithms,includingmachinelearningalgorithms,overlargevolumesofdata,tosupportadiverserangeofrelationalandnon‑relationalschemasandtoexpressanalyticworkloadsinmultipledevelopmentanddatasciencelanguages.Thesecapabilitiesallowenterprisestoidentifytrendsinhistoricaldata,torecognizeeventsincurrentorstreamingdataandtopredicteventsinthefuture,continuouslyimprovingwithexperience.

• Delivers enterprise-grade performance, features and functionality. Ourplatformmeetstheexactingrequirementsoflargeenterpriseson-premisesandinthepubliccloud,including:

– Scalability and high performance. Ourdistributedarchitectureallowsourcustomerstoeasilyandinexpensivelyincreasecapacitytomeetthespeedandthroughputdemandsofenterpriseapplications.Combiningmanysmall,inexpensivecomputersandpoolingtheirstorageandprocessingpowerinoneormore“clusters,”ourplatformcandelivertentimesorgreaterperformanceimprovementsoverlegacysystemsatlowercost.Asdatavolumesorperformancerequirementsincrease,addingmorecapacityorcomputingpowerisassimpleasaddingadditionalcomputerstothecluster.Capacityandperformanceexpandlinearlywithclustersize.Withjustoneinstallationofourplatform,acustomercanscaletohundredsofpetabytesofdataundermanagement.

– Integrated management at scale and across environments. Ourcustomerscandeploy,configureandmonitoralltheirclustersandworkloadsatscalefromacentralizedinterfaceacrossanymixofpubliccloudoron‑premisesenvironments.Weofferconfigurablemonitoringandreportingandintuitive,robusttroubleshootingtoprovidecomprehensivemanagementoflarge,growingdatasetsandconcurrentusecases.

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– Data security and governance. Ourplatformusesproprietaryauthentication,networkisolation,user‑androle‑basedpermissions,accesslogging,auditing,lineageandencryptionincludingsophisticatedkeymanagementtoprovidecomprehensive,enterprise‑gradedatasecurityacrosstheplatform.Inaddition,ourplatformenablesregulatoryandindustry‑specificcompliancethroughcomprehensivedatagovernance,includingdatadiscovery,datalineage,metadatataggingandpolicyenforcement.

– Low total cost of ownership. Ourscale‑outarchitecturedelivershighperformanceoninexpensiveindustry‑standardhardwareorcloudinfrastructure.Thisarchitectureallowsorganizationstogaininsightsandrealizevaluefromdataatmuchlowercostthantraditionaldatamanagementplatforms.Ourproprietarycloudautomation,systemsmanagementanddatamanagementcapabilitiesreducethepersonnelrequiredtooperateclustersandworkloadswhilemeetingcompliancestandards.Ourplatformallowscustomerstoselecttheinfrastructureenvironmentthatismostcost‑effectiveandappropriateforeachusecase.Additionally,thenativesecurityfeaturesofourplatformrequirenoadditionalthirdpartylicenses,furtherreducingcoststocustomers.

Our Strategy

Keyelementsofourstrategyinclude:

• Leading cloud innovation for big data. Ouroriginalarchitecturewasdesignedforthecloud.Itcomprisesinexpensiveindustrystandardhardwareandscale‑outdistributedtechnologythatdeliverselasticity,agilityandflexibility.Wehaveinnovatedsinceourinceptionusingcloudtechnologiestodevelopadvancedanalytictechniques,includingmachinelearning,security,datagovernance,lineageandcompliance.Weintendtocontinuetoleadincloudinnovationforbigdata.

• Growing our addressable market by expanding the range of applications our platform can support. Weintendtocontinuetodevelopourplatform’sarchitectureinordertosupportawiderrangeofdatatypes,accesspatternsandusecases.Forexample,wecreatedImpalatoenablehigh‑performance,self‑servebusinessintelligenceapplications.Similarly,wehaveincorporatedSparkintoourplatformtohandlestreamingandmachinelearning,supportingIoTandreal‑timedataapplications.Inaddition,wepartnerwithselectvendorstodesignsolutionsthataddresstheneedsofindustryverticalsandspecificusecases,whichwerefertoasPartnerSolutions.AsofJuly31,2017,therewereover100PartnerSolutionsapplicationsdeliveredbypartnersusingourproprietarytechnology.Thisinnovationandcollaborationgrowsouravailablemarketandallowsustosupportadditionalapplicationsandusecasestogainnewcustomersandexpandexistingcustomerrelationships.

• Extending our position as the leader in hybrid open source software. WeintendtocontinuetopioneertheHOSSmodel,innovatinginourproprietarysoftwareconcurrentlywithourworkinopensource.Webelievethatcreatingdifferentiationinbothdimensionsisasignificantcompetitiveadvantage.Wededicatesubstantialengineeringresourcestocollaboratewiththecommunityinopensourcesoftwaredevelopmentandinnovation.Weplayacentralroleinfoundingandpopularizingopensourceprojectsthatgoontobecomeindustrystandards.Clouderaengineershavefounded18opensourcedatamanagementprojects,includingmanyofthemostcommerciallysignificantonesandtheoriginalHadooptechnologies.OurHOSSmodelallowsustodelivermorevaluetoourcustomers,achievemeaningfulproductdifferentiation,andmakeitmoredifficultforcompetitorsto“freeride”onopensourceinnovation.

• Continuing to rapidly acquire new customers. Wefocusourgo‑to‑marketeffortsonlargeenterprises,primarilytheGlobal8000,aswellaslargepublicsectororganizations.Wetargettheseorganizationsbecausetheycaptureandmanagethemajorityoftheworld’sdataandoperatehighlycomplexITenvironments.Theseorganizationsarelikelytorealizethegreatestvaluefromutilizingourenterprise‑gradeplatform.AsofJuly31,2017,wehavepenetrated7%oftheGlobal8000.Benefitingfromacceleratingcloudadoption,easeofuseandproliferationof“bigdata”technologyskills,overtimewewillexpandourcustomerfocusbeyondtheGlobal8000.Weintendtocontinueoursalesandmarketinginvestmentstoacquirenewcustomers.Furthermore,wearecommittedtodeepeningourpresenceinthe29countriesinwhichwecurrentlyoperateandtoexpandingourinternationalcustomerbase.

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• Accelerating existing customer expansion. Ourgoalistoenablecustomerstoaccessallavailabledataandtoextractgreatervaluefromit.Weintendtobroadenourrelationshipswithexistingcustomersbyhelpingthemsolvemoreproblemsandprovidingbest‑in‑classsupport.Ourfieldorganization,togetherwithourpartnerecosystem,assistsourcustomersinidentifyingnewusecases,modernizingtheirdataarchitecturesandgainingmoreinsightfromtheirdata.Inaddition,ascustomers’datagrowsandmoreuserstakeadvantageofeachusecase,morecomputationalpowerandstorage(orresourceconsumptioninthecloud)isrequired,andoureconomicrelationshipwitheachcustomerexpands.Ourlargeandexperiencedsupportorganizationusesthemachinelearningcapabilitiesofourplatformtopredictproblemsbeforetheyoccurandtoproactivelyhelpourcustomersachievetheirobjectives,drivingsatisfactionandexpandedutilizationofourplatform.

• Leveraging our partner ecosystem. Over2,800resellers,systemsintegrators,independentsoftwarevendorsandplatformandcloudprovidershaveregisteredunderourClouderaConnectpartnerprogramtogainaccesstomarketing,sales,trainingandsupportresources.Inaddition,agrowing,vibrantecosystemisdevelopingaroundourplatform,andmanythird‑partydevelopershaveprimarilystandardizedonitinbuildingapplications.Thesepartnersalsoenhanceourfieldorganization’seffortsacrossindustryverticalsandgeographies.Weintendtomaintainstrongengagementwithourpartnerecosystemtogainincreasedreachandgreaterdistributionofoursoftware,developnewapplications,acceleratecustomerexpansionandpenetratenewmarkets.

• Showcasing a data‑‑driven business with our own operations. Thewayweoperateourbusinessreflectsourbeliefinthedata‑drivenenterprise.Weuseourownplatformtocapture,processandanalyzeinformationacrossourorganizationtoimproveourengineering,sales,supportandfinancefunctions.

• Cultivating a passion for solving the world’s greatest challenges through data. Asaglobalsociety,wefacetremendouschallenges.Theworld’spopulationwillgrowsignificantlyoverthenextthirtyyears.Billionsmoreofuswillneedfood,cleanwaterandcleanenergy.Climatechange,diseaseandterrorismthreatenglobalhealthandwelfare.Werelyontechnologythatissubjecttosophisticatedcyber‑attacks.Dataanalysisandmachinelearningarepowerfultoolsforsolvingalloftheseproblems,andwebelievewecanmakeasubstantialcontributiontowarddeliveringthesecapabilities.Weaimtocreateacultureandbuildpassionamongouremployees,ourpartnersandourcustomersforusingdatatosolvetheworld’sbiggestproblems.

Our Platform Editions

Weoffersubscriptionsforfiveeditionsofourplatform,rangingfromClouderaEssentialstotheindustryleadingClouderaEnterprise.Othereditionsaredesignedtoaddressthemostcommonandcriticaldatachallengesenterprisesface:ClouderaDataScienceandEngineeringforprogrammaticpreparation,predictivemodelingandmachinelearning;ClouderaOperationalDBforonline,streamingandreal‑timeapplications;andClouderaAnalyticsDBforbusinessintelligenceandSQLanalytics.

Our Technology

WehavepioneeredtheHOSSmodel,opensourcesoftwarethatiscombinedwithproprietarysoftware,forspecificapplicationsandtomeetenterprise‑graderequirements.Byintegratingrobustproprietarysoftwarewithouropensourceplatformbuiltontheleadingdatamanagement,machinelearningandadvancedanalyticstechnologiessuchasHadoopandSpark,wedeliveraunique,high‑performanceandcost‑effectiveplatformtoourcustomersformanaging,analyzingandsecuringtheirdata.

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Differentiated Open Source

Ourplatformofferingsarebasedonopensourcecomponentsdevelopedinpartnershipwiththebroaderopensourcecommunity.Ourengineersareactivelyinvolvedinthedevelopmentoftheopensourceelementsincludedinourplatformandcarefullycuratewhichopensourceprojectsareintegratedintotheplatform,ensuringinteroperabilityandoptimizingperformance.TheprecisecompositionoftheplatforminitsintegratedformisuniquetoClouderaandhighlydifferentiated.

• Integrate. Datacomesfromanincreasingvarietyofsourcesinanincreasingnumberoftypes.Ourplatformenablescustomerstocapturedigitalinformationinanyformfromanysourceandcollectithoweveritarrives–streamingcontinuouslyorinbatchesfromexternaldatabasesorothersources–andinanyformat,whetherstructuredorunstructured.Thisflexibilityprovidesorganizationswiththeabilitytodrawinsightsfromalloftheirdatairrespectiveofvolume,formorspeedatwhichitisgenerated.

• Store. Wedeliverstoragesoftwaretechnologiesthatareoptimizedforavarietyofdatatypes,accesspatternsandperformancerequirements.Thesestorageenginesprovideourcustomerswiththescalabilityandcostefficiencytomeetthedataandsizerequirementsofbothon‑premisesandcloudarchitectures.ThesestorageenginesincludeHDFS,whichprovidesvastscalability,aswellastheNoSQLstore(HBase)fordatarequiringmorefrequentupdates.Wenowalsoofferanin‑memorycolumnarrelationalstore(Kudu),technologyfoundedandcontributedtotheopensourcecommunitybyClouderaengineers,designedespeciallyforIoTandcomplexqueryworkloads.Forclarity,Clouderadoesnotprovidethe

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underlyingstorageinfrastructureforthedata.Werelyonhardwarepartnersandweintegratewiththeobjectstorageservicesofthemajorpubliccloudvendors,suchasAmazon’sSimpleStorageService(S3)andMicrosoft’sAzureDataLakeService(ADLS).

• Unified Services. Ourplatformprovidesaunifiedsetofservicesincludingresourcemanagementandsecurityforenterprisemanagement,scalabilityandfunctionality.Ourresourcemanagementcapabilitiesscheduleworkloadsandoptimizetheallocationofcomputeandmemorycapacitytomaximizeefficiencyindataanalysis,allowingcustomerstoextractvaluefasterandatlowercost.Oursecurityframework(Sentry)controlsdataaccessdowntothetable,columnorrowandisbackedbystrong,centralizedauthentication.Alldatainourplatformcanbeencrypted,andweprovideenterprise‑gradekeymanagementtoprotectinformationwithoutsacrificingfunctionalityorperformance.

• Process, analyze and serve. Ourplatformisabletoprocess,analyzeandconsistentlydeliverdataathighlevelsofperformance.Byprovidinghighperformancepernode,ourcustomerscanruntheirapplicationsathigherratesofinteractivityandoperateatlowercost.Weofferfast,flexiblebatchprocessing(theSpark,Hive,PigandMapReduceprojects)aswellasrapidquerying(Impala)andfacetedsearch(Solr).Ourplatformalsoutilizesavarietyofdatasciencelanguagesforpredictiveanalysisandmachinelearning(Spark).Moreover,weoffertheabilitytoanalyzestreamingdataandcompareitagainstreferencedatatogenerateinsightsandresponsesinrealtime.

Differentiated Proprietary Software

Inadditiontotheopensourceelementsincludedinourplatform,wedevelopproprietary,robustsystemsmanagement,datagovernance,andcloudautomationcomponentstoscale,secureandoptimizeourplatformfortheenterprise.

• Operations. Cloudera Manager allowsourcustomerstomanagealloftheirclustersandworkloadsfroma“singlepaneofglass.”Itautomatestheoperationalaspectsofourplatformincludingpatching,updating,upgrading,tuning,reconfiguring,monitoring,alertingandusagereporting.UsingCloudera Manager ,customerscaneasilysetupautomateddeploymentofclustersandconfigurationswiththeabilitytomanagemultipledevelopment,testandproductionclusters.Weprovidecompletevisibilitywithadvancedmonitoringcapabilitiesaswellasinformationonjobsandqueryperformance.Additionally,Cloudera Manager offersacustomizabledashboardwiththeabilitytocreateadvancedchartsforhistoricalmonitoringandcustomtriggersandthresholdsforeachcustomer’senvironment.Finally,withcomprehensiveautomationforrollingupgradesandbuilt‑inbackupanddisasterrecovery,Cloudera Manager requiresminimaldowntimeformaintenance.

• Cloud enablement. Cloudera Director simplifiesorganizations’abilitytotakeadvantageofpubliccloudinfrastructurefordatamanagement,machinelearningandadvancedanalyticsandenablesmixedarchitecturalenvironments.Cloudera Director automatesandabstractsclusterinteractionswithcloudinfrastructureproviders,includingAmazonWebServices,MicrosoftAzureandGoogleCloudPlatform,providingcloudautomationandorchestrationthroughanintuitiveuserinterface.UsingCloudera Director ,customerscancreatelargescaleproductionclustersinthecloudinamatterofminutes.Cloudera Director providescloudautomationfortransientworkloads(disposable,single‑purposeclusters)andforelasticworkloads(long‑livedclustersthatgroworshrinkovertime).Cloudera Director isdeeplyintegratedwithourplatformanddirectlylinkedtoCloudera Manager foraconsistentadministrativeexperience.

• Data management. OurCloudera Navigato rfamilyofcomponentsprovidesacompletedatagovernancesystemforthedatamanagedinClouderaclusters,offeringcriticalcapabilitiessuchasdatadiscovery,workloadmigrationandoptimization,audit,lineage,metadatatagginganddatapolicyautomation.Thisenablesenterprisestotrack,classifyandlocatedatatocomplywithbusinessgovernanceandcompliancerulesquicklyandeasily.

– Cloudera Navigator Audit and Lineage providesafullauditablehistoryofalldataaccesseswithaunifiedsearchableauditdashboardwhich,combinedwithintegratedbackupanddisasterrecovery,

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makescomplianceandbusinesscontinuityeasy.Itallowscustomerstofindkeydataassetswhenneededandtosatisfythedemandsofbusinesspolicyandregulatoryoversight.

– Cloudera Navigator Optimizer analyzestheSQLqueriesthatcustomersuse,whetheragainsttraditionalenterprisedatawarehousesortheirClouderainstallation.Itdeducesthestructuresandschemaofdatamanagedbythesystemandcanofferadvicetodatabaseadministratorsforoptimizingdatalayoutinordertoimprovesystemperformance.Mostimportantly,itsimplifiesthemigrationoftraditionalrelationalworkloadsfromlegacysystemstoourplatformsothatcustomerscandeterminetheoptimaltechnologytorunqueriesandstoredatatoreducecostsandimproveperformance.

– Cloudera Navigator Encrypt and Key Trustee aretwocomplementary,andessential,componentsofoursecuritycapability.Ourencryptiontechnologyallowscustomerstosetandenforcethepoliciesgoverningdataencryptioninthesystem.ItusesthenativecapabilitiesoftheIntelArchitecturesystemsthatourcustomersuse,whenavailable,toperformstrongencryptionofdataatverylowoverhead.Ourkeymanagementfunctionalitykeepstheencryptionkeysphysicallyremotefromtheencrypteddata,minimizingthechancethatasystemsbreachcouldcaptureboth.Itallowsanadministratortoeasilygrantandrevokekeyprivilegesforanyuserandtoenforcesecuritydiscipline.

Ourresearchanddevelopmentexpensesforfiscal2015,2016and2017were$66.4million,$99.3millionand$102.3million,respectively.OurresearchanddevelopmentexpensesforthesixmonthsendedJuly31,2016and2017were$51.2millionand$138.7million,respectively.

Recent Developments

Sinceourinitialpublicoffering,wehavecontinuedtoinnovateanddevelopnewtechnologiesandsolutionstoextendourmarketleadershipandenhanceourplatformformachinelearningandanalytics,optimizedforthecloud.Therearefournotableadditionstoourofferings:

• Cloudera Altus. ClouderaAltusisourplatform-as-a-service(PaaS)offering.Altusisacloudservicethatisdesignedtosimplifytheuseofourplatformbyeliminatingtheneedtoinstall,manageandupdateoursoftware.ThefirstserviceonAltusisClouderaAltusDataEngineering,aconvenient,user-drivenserviceforbuildingandmaintainingproductiondataengineeringjobsinAmazonWebServices.WithAltus,Clouderacanaddressanewsetofelasticandtransientworkloadsthatwouldotherwisebeimpracticaltoruninthedatacenter.Overtime,weexpectAltustosupporttherestofourplatformofferingsandadditionalpubliccloudproviders.

• Cloudera Data Science Workbench. ClouderaDataScienceWorkbenchenablesfast,easy,andsecureself-servicedatasciencefortheenterprise.DataScienceWorkbenchisamulti-user,multi-languagedevelopmentenvironmentfordatascienceandmachinelearningapplications.Ithelpsstreamlinethevariousstepsofthemodeldevelopmentlifecycleincludingversioning,dependencymanagement,scheduling,multi-usercollaborationandtrainingmodelsondisparatetypesofcompute.Byenablingcollaborationandsimplifyingapplicationdevelopmentfordatascientists,DataScienceWorkbenchspeedsmachinelearningworkloadsintoproductiononourplatform.

• Fast Forward Labs. OurrecentacquisitionofFastForwardLabs,Inc.enablesustoprovideourcustomerswiththeleadingappliedresearchinmachinelearningandartificialintelligence.ClouderaFastForwardLabssurveysacademicandindustrialresearchfordevelopmentsinthefield,enablingcustomerstobenefitfromthelatestadvancesinappliedmachinelearningandartificialintelligence.Throughoursoftwareandsystemsintegrationpartnersandourownservicesorganization,weareabletodeploythosetechniquesinproductionsolutions,solvingcriticalbusinesschallengesforlargeenterprises.OvertimeweexpectthesecapabilitiestodriveincreasedconsumptionofClouderaDataScienceWorkbenchandourplatform,bothon-premisesandinthepubliccloud.

• Cloudera SDX. ClouderaSDXisamodularsoftwareframeworkthatenablesourcustomerstohavea“shareddataexperience.”Byapplyingacentralized,consistentframeworkforschema,security,governance,dataingestandmore,SDXmakesitpossiblefordozensorhundredsofdifferentcustomer

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applicationstorunagainstsharedoroverlappingsetsofdata.SDXmakesmulti-disciplinarydataapplicationseasiertodevelop,lessexpensivetodeployandmoreconsistentlysecure.SDXsupportsmultiplepubliccloud,privatecloudandbaremetalconfigurations.

Customer Support, Services and Education

Wehavebuiltacompanyculturethatfocusesonconsistentlydeliveringvalueforourcustomersandensuringtheirsuccessandsatisfaction.Wedeliverexceptionalsupport,professionalservicesandtrainingtoensureourcustomersgetthemostoutofourtechnology.Weoffertechnicalassistancethroughourlargeandexperiencedglobalsupportorganization.Builtonpowerfulpredictiveanalyticsusingourowntechnology,weproactivelymonitorourcustomers’platformstopreventissuesbeforetheyarise,avoidcommonclustermisconfigurations,andsuggestoptimizationbasedonsimilarcasesatothercustomers.Ourpredictiveanalyticsallowustoproactivelyinitiateasubstantialfractionofoursupportengagementsforcustomers,beforetheyrealizethattheyhaveaproblemthemselves.

Inaddition,ourteamsofexperiencedsolutionarchitects,businessvalueconsultantsandtrainingprofessionalsaredesignedtoenhancethecustomerexperiencewithpersonalizedassistance,fromimplementationandbestpracticestoeducationandonlinetraining.Webelievethatwecanfurtheradvancethecommunity’sgoalsthrougheducation.Inadditiontoofferingonlinetraining,wehavetrainedover39,000individualsinpersonthroughJuly31,2017.ThroughtheClouderaAcademicProgram,weprovideaccesstocurriculum,softwareandtrainingtocollegesanduniversitiestoacceleratetheadoptionoftheplatform.Webelievewearetheleadingmoderndatamanagementeducator.

Customers

Wefocusonthelargest8,000corporateenterprisesglobally(Global8000)aswellaslargepublicsectororganizationsbecausetheseorganizationscaptureandmanagethevastmajorityoftheworld’sdataandoperatehighlycomplexITenvironments.Theseorganizationsarelikelytorealizethegreatestvaluefromutilizingourenterprise‑gradeplatform.Largeenterprisesarerapidlyadoptingourplatform.AsofJuly31,2017,wehadmorethan1,000customers,includingapproximately562Global8000customersinmorethan45countries,aswellasthegovernmentsof27countries.Wehavealreadyachievedsignificantpenetrationofthelargestenterprises.AsofJuly31,2017,ourcustomersincluded:

• 7ofthetop10largestbanks,

• 8ofthetop10largesttechnologycompanies,

• 9ofthetop10largesttelecommunicationcompanies,and

• 6ofthetop10largesthealthcareandlifesciencescompanies,

ineachcase,basedontheFORBESGlobal2000ranking.See“Market,IndustryandOtherData—Global8000.”

ForpurposesofdefiningtheGlobal8000,thetop2,000enterprisesintheGlobal8000arebasedontheFORBESGlobal2000rankingandtheremainderisbasedonentitieslistedinData.comashavingthehighestannualrevenue,excludingthosethatarelistedintheFORBESGlobal2000.

Forpurposesofcustomercount,aGlobal8000customerisdefinedasanentitywithauniqueFORBESGlobal2000orData.comidentifierandquarterlysubscriptionrevenueasofthemeasurementdate.WemakeexceptionsforholdingcompaniesandotherorganizationsforwhichtheFORBESGlobal2000orData.comidentifierinourjudgmentdoesnotaccuratelyrepresenttheClouderacustomer.Ourcustomercountissubjecttoadjustmentsforacquisitions,spin‑offsandothermarketactivity.Wheretheseadjustmentsoccur,previouslydisclosednumbersofcustomersarerestatedtoallowforcomparability.See“Market,IndustryandOtherData—Global8000.”

Noindividualcustomerrepresentedmorethan10%ofrevenueinfiscal2016or2017.

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Customer Case Studies

Human Capital Management

Thisleadingproviderofhumancapitalmanagementsolutionshasstrategicallyshiftedinrecentyearsfromprimarilyprocessingtransactionstoalsoprovidinginsight-basedservicesutilizingitsdata.ItslatestservicerunsonClouderaEnterpriseandanalyzesmorethanonepetabyteofinformationaboutmillionsofpeople,basedprimarilyonitsclients’humanresourcerecords.WithCloudera,thiscustomerisabletodeliveravaluableworkforceintelligenceservicetoitsclients.Thissolutionusesmachinelearningtorecognizepatternsanddetectanomaliesinclientdatatohelpidentifyemployeesatriskofturnover.Thecompanyhasrealizedthefollowingbenefitssinceimplementingourplatformin2013:

• Reducedclientemployeeturnoverandfacilitatedsalaryequalityacrossoverhalfamillionclients;

• Identificationofemployeepopulationswithhighestriskofturnover,allowingclientstofocustheirretentioneffortsonemployeesmostlikelytoterminatevoluntarily;and

• Significantgrowthamongitsclientbase,increasingitsrevenueoverall.

Mining Equipment

Thisglobalminingequipmentandservicesproviderspecializesinsolutionsfortheexcavationofenergy,industrialandotherhardrockminerals.Usingoursoftwareplatform,thecompanybuiltacloud-basedIoTanalyticsplatformthatprovidesscalability,performanceandflexibilitytosupportitsglobalserviceteams.Asinglepieceofminingequipmentcangenerate50,000uniquetime-stampedrecordseveryminute.ByanalyzingthisdatainClouderaEnterpriserunningonMicrosoftAzure,thiscustomerisabletocreateamorecompletepictureofmachinehealthandoperationsintheminesinwhichtheirequipmentoperatesandtoenableitsowncustomerstoidentifywaystoimproveequipmentperformanceandutilizationrates.Thecompanyhasreportedthefollowingbenefitsfromitsuseofourplatformsince2016:

• Doublingofequipmentutilization,throughmachinelearningandpredictivemaintenance;

• Improvedproductdesignbasedoninsightgainedfromdataanalysis;and

• Reducedinfrastructurecostsbyconsolidatingdataintoacloud-basedplatform.

National Security/Intelligence

ThisnationalsecurityorganizationusesCloudera’splatformtoidentifypotentiallysuspiciousactivityacrossthewebandsocialmediaplatforms.Theorganizationthenmakesthatinformationavailabletohundredsofothercommercialandfederalorganizations.Thescopeandenormityofthisagency’sworkcausessignificantscalabilityandperformancechallengesforitsinformationtechnology.Theorganizationusesourplatformformachinelearningandanalyticstoovercomethesechallenges.WithCloudera,thisorganizationnowoffersreal-timeinformationandwarningstoothergovernmentorganizations.TheagencyhasrealizedthefollowingbenefitsusingtheClouderaplatformacrossmultipleyears:

• Abilitytoimmediatelysharerichinformationonmajormalwareoutbreaks;

• Strengthenedprotectionagainstcyber-attacks;and

• Improveddatamanagementscalabilityandperformance.

Medical Testing

Thisleadingproviderofhealthcarediagnosticsproducesover200millionlabresultseachyear.Previously,itsdatawassiloedbyteamand/orbydatawarehouse.ClouderaEnterpriseenabledittoeasilycombinestructureddatafromitsdatawarehouseswithunstructureddatafromavarietyofothersources.WithitsdataontheClouderamachinelearningandanalyticsplatform,thecompanyhasbeenabletobegindeliveringnewdata-driveninsights,

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supportinghealthcareproviderstoimprovepatientcare.Thecompanyhasreportedthefollowingbenefitssinceimplementingourplatformin2015:

• Greateragilityindeliveringnewproducts;

• Newinsightsgainedonover60millionuniquepatientstoimprovepatientcareandsupporthealthierlifestyles;and

• DemonstratedcompliancewithHealthInsurancePortabilityandAccountabilityAct(HIPAA)requirementsfordatasecuritywithcomprehensiveauditandencryptioncapabilities.

Financial Services

Thislargefinancialinstitutionoffersafullrangeoffinancialproductsandservicestoover20millioncustomersworldwide.Itsgoalwastodeploymachinelearningandengageindataexplorationandsentimentanalysisacrossfinancialproducts,eventsandinitiatives.ImplementingCloudera’smachinelearningandanalyticsplatform,itnowingestsdatafromover100corporatesystemsandsupportsmorethanadozenusecases,includingfrauddetectionandriskmanagement.Theplatformsimplifiescommonmodeldevelopmenttaskstofacilitatethedeliveryofcomplexpredictivemodeling.Thecompanyhasrealizedthefollowingbenefitsfromitsuseofourplatformsince2014:

• Identificationofcustomeraffinitiestoprovideproductrecommendationsfor10millioncustomersinminutes;

• PredictionofcustomersthataremorelikelytoacquireMutualFundsastheirnextactionthroughsequenceanalysisoncustomerjourney;and

• Reductionindatamanagementcostsbyhalfandstoragecostsbyover95%perGB.

Sales and Marketing

Weprimarilysellthroughourdirectsalesforce,whichiscomprisedoffieldandinsidesalespersonnelandareorganizedbyenterprisesizeandgeography.

Oursalesforceissupportedbysalesengineerswithdeeptechnicalexpertiseandresponsibilityforpre‑salestechnicalsupport,solutionsengineeringforourend‑customers,andtechnicaltrainingforourchannelandstrategicpartners.

Wegeneratecustomerleads,acceleratesalesopportunities,andbuildbrandawarenessthroughourmarketingprogramsandthroughourstrategicpartnerrelationships.OurmarketingprogramstargetboththeC‑suiteandthelineofbusinessowners,technologyprofessionalsandriskprofessionals,aswellassoftwaredevelopersanddatascientists.Ourprincipalmarketingprogramsinclude:

• webinars,userconferencesandeventsthatwesponsor,suchasStrataDataConference;

• cooperativemarketingeffortswithpartners;and

• useofourwebsite.

Partners and Strategic Alliances

Webelievethatstrongengagementwithourpartnerecosystemaffordsusincreasedreachandgreaterdistributionofoursoftware,enhancingourfieldorganization’sefforts.Wehavedevelopedalargepartnernetworkinordertofacilitatetheestablishmentofindustrystandards,ensureanopenecosystemforourcustomers,acceleratetheadoptionofourplatformandextendoursalescapabilitiesandcoverage.Over2,800vendors–avarietyofsystemsintegrators,resellers,softwareandOEMpartners,datasystemsvendors,andcloudandplatformvendors–haveregisteredunderourClouderaConnectpartnerprogramtogainaccesstomarketing,sales,trainingandsupportresources.

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Ourpartnersandstrategicalliancesinclude:

• Systems integrators and resellers. Hundredsofsystemsintegratorsofferprofessionalservicestocreatecustomsolutionsbuiltonourplatformfortheircustomersacrossavarietyofindustryverticals.Resellersofferourplatformtotheircustomersincombinationwiththeirproducts.Thesechannelpartnerscreatesignificantleverageforourfieldsalesorganization,improvingnewcustomeracquisitionandexistingcustomerpenetrationthroughusecaseexpansion.

• Software and OEM partners. Ourtechnologypartnersoffersolutionsdesignedtoworkwithorbuiltonourplatform.Hundredsofcertifiedsolutionshavebeentestedandvalidatedtorunonourplatform,acceleratingadoptionofourcombinedsolutions.

• Data systems vendors. Weensurethatourplatformisinteroperablewithavarietyoftraditionaldatasystemsvendors.Theseintegrationsprovideourcustomerswithaccesstotheirdatastoredinthosesystemsforuseinourplatform.

• Platform and cloud vendors. Toensureourcustomerscanrunoursoftwareinanyenvironment,wenurturerelationshipswithpubliccloudprovidersandotherenterpriseplatformstoachievethehighestinteroperabilityacrossarchitectures.

Manythird‑partydevelopershaveprimarilystandardizedonourplatformandweworkcloselywithselectpartnerstodesignsolutionsthatspecificallyaddresstheneedsofcertainindustryverticalsorusecaseswithinthoseverticals,whichwerefertoasPartnerSolutions.AsofJuly31,2017,therewereover100PartnerSolutionsapplicationsdeliveredbypartnersusingourproprietarytechnology.Forexample,theAccentureCyberIntelligencePlatformmarriesadvancesinchipprocessortechnologywithaproprietarycombinationofartificialintelligence,machinelearningandstreaminganalyticstohelporganizationsidentifyneverbeforeseen,network‑borncybersecuritythreatsinnearreal‑time,utilizingourplatform.

Intel Strategic Partnership

Intelbelievesthatbigdataapplicationswillbeoneofthelargestdriversofdatacenterutilization,whetherinthecloud,privatecloudortraditionaldatacentersinthefuture.In2014,inconnectionwithanequityinvestmentinthecompany,weenteredintoastrategiccollaborationandoptimizationagreementwithIntel.See“CertainRelationshipsandRelated‑PartyTransactions.”ConsistentwithIntel’sdatacenterandIoTtechnologyinitiatives,theprimaryobjectiveoftheagreementistoensurethatoursolutionsdeliveroptimalperformanceandsecuritywithIntelprocessorsandplatformtechnology.IntelandClouderamaintainajointproductroadmap,andeachcompanydedicatessubstantialresourcestofulfillingthisobjective.Asaresult,ourplatformachievesdifferentiatedperformanceonIntelarchitecturetoday,andisexpectedtoachievedifferentiatedperformanceonfutureIntelplatformtechnologiesimmediatelyuponreleasetocustomers.Amongmanytangibleexamplesofjointdevelopment,IntelandClouderacollaboratedonoptimizeddataencryptionspeedthroughuseofarithmeticaccelerationbuiltintotheIntelArchitecture.IntelandClouderaalsocollaboratedtodevelopSpot(incubatingproject),anopensourcecybersecurityanalyticsplatformbuiltonopendatamodelsthatprovidesadvancedthreatdetectionusingbigdataanalyticsandmachinelearning.

Competition

Weoperateinanintenselycompetitivedatamanagement,machinelearningandanalyticsmarketthatischaracterizedbytheconstantdevelopmentofnewproductsandcontinuedinnovation,particularlyintheopensourcecommunity.Ourmainsourcesofcurrentandpotentialcompetitionfallintofourcategories:

• legacydatamanagementproductproviders;

• publiccloudproviderswhoincludeproprietarydatamanagementandanalyticsofferings;

• strategicandtechnologypartnerswhomayalsoofferourcompetitors’technologyorotherwisepartnerwiththem;and

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• opensourcecompanies,aswellasinternalITorganizationsthatprovideopensourceself‑supportfortheirenterprises.

Asthemarketfordatamanagementandanalyticsplatformscontinuestogrowandofferingsbasedontheopensourcedatamanagementecosystemcontinuetogaintraction,weexpectmorehighlyspecializedvendorswillenterthemarketorlargercompetitorswillbundlesolutionswiththeirproductsmoreeffectively.

Theprincipalcompetitivefactorsinourmarketinclude:

• abilitytodeployinavarietyofinfrastructureenvironments,includingmulti‑cloudcapability;

• abilitytoidentifyandleverageinnovativeopensourcetechnologies;

• enablementofmachinelearningandotheradvancedtechnologies;

• enterprise‑gradeperformanceandfeaturessuchasscalability,security,costofownershipandeaseofdeploymentanduseofapplications;

• breadth,depthandqualityofapplicationfunctionality;

• domainexpertiseandunderstandingofcustomerrequirementsacrossverticals;

• abilitytoinnovateandrespondtocustomerneedsrapidly;

• qualityandresponsivenessofservicesandsupportorganizationsandlevelofcustomersatisfaction;

• brandawarenessandreputation;

• sizeofcustomerbaseandlevelofuseradoption;and

• abilitytointegratewithlegacyandotherenterpriseinfrastructuresandthird‑partyapplications.

Webelievethatwecompetefavorablyonthebasisofthesefactors.Ourabilitytoremaincompetitivewilllargelydependonourongoingperformanceintheareasofcloudandintegrationofopensourceandadvancedtechnologies.

Intellectual Property

Intellectualpropertyisanimportantaspectofourbusiness,andweseekprotectionforourintellectualpropertyasappropriate.Toestablishandprotectourproprietaryrights,werelyuponacombinationofpatent,copyright,tradesecretandtrademarklawsandcontractualrestrictionssuchasconfidentialityagreements,licensesandintellectualpropertyassignmentagreements.Wemaintainapolicyrequiringouremployees,contractors,consultantsandotherthirdpartiestoenterintoconfidentialityandproprietaryrightsagreementstocontrolaccesstoourproprietaryinformation.Theselaws,proceduresandrestrictionsprovideonlylimitedprotection,andanyofourintellectualpropertyrightsmaybechallenged,invalidated,circumvented,infringedormisappropriated.Furthermore,thelawsofcertaincountriesdonotprotectproprietaryrightstothesameextentasthelawsoftheUnitedStates,andwethereforemaybeunabletoprotectourproprietarytechnologyincertainjurisdictions.Moreover,ourplatformincorporatessoftwarecomponentslicensedtothegeneralpublicunderopensourcesoftwarelicensessuchastheApache2.0SoftwareLicense.Weobtainmanycomponentsfromsoftwaredevelopedandreleasedbycontributorstoindependentopensourcecomponentsofourplatform.Opensourcelicensesgrantlicenseesbroadpermissionstouse,copy,modifyandredistributeourplatform.Asaresult,opensourcedevelopmentandlicensingpracticescanlimitthevalueofoursoftwarecopyrightassets.

AsofJuly31,2017,wehadbeengranted18U.S.patentsandhad15U.S.patentapplicationspending.Ourpatentsexpirebetween2030and2035.Wealsohad4issuedpatentsand6patentapplicationspendinginforeignjurisdictions.Wecontinuallyreviewourdevelopmenteffortstoassesstheexistenceandpatentabilityofnewintellectualproperty.Wepursuetheregistrationofourdomainnames,trademarksandservicemarksintheUnited

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StatesandincertainlocationsoutsidetheUnitedStates.Toprotectourbrand,wefiletrademarkregistrationsinsomejurisdictions.

Legal Proceedings

Fromtimetotime,weareapartytooractasanindemnitortoourcustomersorpartnersonvariouslitigationmatters,andweorourcustomersorpartnersaresubjecttoclaimsthatariseintheordinarycourseofbusiness.Inaddition,weorourcustomersorpartnershavereceived,andmayinthefuturereceive,varioustypesofclaimsincludingpotentialclaimsfromthirdpartiesasserting,amongotherthings,infringementoftheirintellectualpropertyrights.Forexample,onMay26,2017,plaintiffsUniversityofTennesseeResearchFoundationandSaintMathewResearchLLC,filedalawsuitagainstusintheU.S.DistrictCourtfortheMiddleDistrictofTennessee.Thesuitallegesthatcertainsoftwareproductsthataremade,usedorsoldbyClouderainfringeU.S.PatentNos.7,454,411and8,099,733.Theplaintiffsseekdamages,anawardofenhanceddamages,andrecoveryofattorney’sfeesandcostsincurredinthesuit.

Futurelitigationmaybenecessarytodefendourselves,orourcustomersorpartnersonindemnitymatters,bydeterminingthescope,enforceabilityandvalidityofthird‑partyproprietaryrightsortoestablishourproprietaryrights.Further,theultimateoutcomeofanylitigationisuncertainand,regardlessofoutcome,litigationcanhaveanadverseimpactonusbecauseofdefensecosts,potentialnegativepublicity,diversionofmanagementresourcesandotherfactors.Accordingly,therecanbenoassurancethatexistingorfuturelegalproceedingsarisingintheordinarycourseofbusinessorotherwisewillnothaveamaterialadverseeffectonourbusiness,consolidatedfinancialposition,resultsofoperationsorcashflows.

Facilities

Wecurrentlyleaseapproximately225,000squarefeetofspaceforourcurrentcorporateheadquartersinPaloAlto,Californiaunderaleaseagreementthatexpiresin2027withanoptiontorenewforanadditional84months.Inaddition,weenteredintoafiveyearsubleaseagreementwithathirdpartysubtenantforapproximately105,000squarefeetofthisspace.Wealsolease54,000squarefeetofspaceinPaloAlto,California,andweenteredintoafour‑yearsubleaseagreementwithathirdpartysubtenantforapproximately54,000squarefeetofthisspace.WehaveadditionalofficesinSanFrancisco,NewYorkCityandAustinintheUnitedStatesandinternationallyinBudapest,LondonandSingaporeunderleasesthatexpireatvaryingtimesbetween2018and2024.Webelievethatourcurrentfacilitiesaresufficientforourcurrentneeds.Weintendtoaddnewfacilitiesorexpandexistingfacilitiesasweaddstafforexpandourgeographicmarkets,andwebelievethatsuitableadditionalspacewillbeavailableasneededtoaccommodateanysuchexpansionofourorganization.

Employees

AsofJuly31,2017,wehad1,606full‑timeemployees.Oftheseemployees,1,140areintheUnitedStatesand466areinourinternationallocations.Noneofouremployeesisrepresentedbyalaborunionorcoveredbycollectivebargainingagreements.Wehavenotexperiencedanyworkstoppages.Weconsiderourrelationshipwithouremployeestobegood.

Cloudera Foundation

InJanuary2017,weestablishedtheClouderaFoundationasanindependentnon‑profitorganizationandissued1,175,063sharesofourcommonstocktoit.Inconjunctionwiththeinitialpublicoffering,wecontributed1%ofthenetproceedsofourinitialpublicoffering,or$2.4million,tofundtheClouderaFoundation.TheClouderaFoundationwascreatedtousethepowerofdatatoimprovethelivesofpeoplearoundtheworldbyprovidingourproducts,skillsandpeople.WebelievethattheClouderaFoundationfostersemployeemorale,strengthensourcommunitypresenceandprovidesincreasedbrandvisibility.

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MANAGEMENT

Executive Officers and Directors

ThefollowingtableprovidesinformationregardingourexecutiveofficersanddirectorsasofJuly31,2017:

Name Age Position(s)ThomasJ.Reilly 55 ChiefExecutiveOfficerandDirectorMichaelA.Olson 55 ChiefStrategyOfficerandChairmanJimFrankola 52 ChiefFinancialOfficerMartinCole(1)(2)(3) 61 DirectorKimberlyL.Hammonds(2)(3) 50 DirectorPingLi(2) 45 DirectorSteveJ.Sordello(1) 48 DirectorMichaelA.Stankey(1)(3) 58 Director___________(1) Memberoftheauditcommittee(2) Memberofthecompensationcommittee(3) Memberofthenominatingandgovernancecommittee

Executive Officers

Thomas J. Reilly hasservedasamemberofourboardofdirectorsandasourChiefExecutiveOfficersinceJune2013.PriortoCloudera,Mr.ReillyservedasVicePresidentandGeneralManagerofEnterpriseSecurityatHewlett‑PackardCompanyfromNovember2010toMay2012.FromDecember2006toMay2011,Mr.ReillyservedasChiefExecutiveOfficerofArcSight,Inc.,anenterprisesecuritycompany,whichHPacquiredin2010.PriortoArcSight,fromApril2004toOctober2006,Mr.ReillywasVicePresidentofBusinessInformationServicesforInternationalBusinessMachinesCorporation(IBM),acomputertechnologycompany,followingitsacquisitionofTrigoTechnologies,Inc.,aproductinformationcompany,whereMr.ReillyservedastheChiefExecutiveOfficer.Mr.ReillycurrentlyservesontheboardofdirectorsofJiveSoftware,Inc.,anenterprisesoftwarecompany,andontheboardsofdirectorsofseveralprivatecompanies.HepreviouslyservedontheboardsofdirectorsofArcSightfromJune2008toOctober2010andofEloqua,Inc.fromJune2012toFebruary2013.Mr.ReillyholdsaB.S.inmechanicalengineeringfromtheUniversityofCalifornia,Berkeley.Mr.ReillywasselectedtoserveasamemberofourboardofdirectorsduetotheperspectiveandexperiencehebringsasourChiefExecutiveOfficer,andduetohisextensiveexperiencemanagingtechnologycompanies,rangingfromstart‑uptolargepubliccompanies.

Michael A. Olson isourco‑founderandhasservedastheChairmanofourboardofdirectorssinceApril2009andasourChiefStrategyOfficersinceJune2013.Previously,Mr.OlsonservedasourChiefExecutiveOfficerfromAugust2008toJune2013.PriortoCloudera,fromFebruary2006toJanuary2008,Mr.OlsonwasVicePresidentofEmbeddedTechnologiesatOracleCorporation,asoftwareanddatamanagementdeveloper.Beginningin1998,Mr.OlsonservedasVicePresidentofSalesandMarketingofSleepycatSoftware,Inc.,asoftwarecompany,andlaterservedasChiefExecutiveOfficerfrom2000untilitsacquisitionbyOraclein2006.Mr.OlsonholdsaB.A.incomputerscienceandM.S.inelectricalengineeringandcomputersciencefromtheUniversityofCalifornia,Berkeley.Mr.Olsonwasselectedtoserveasamemberofourboardofdirectorsduetotheperspectiveandexperiencehebringsasourco‑founder,ChiefStrategyOfficerandourformerChiefExecutiveOfficer.

Jim Frankola hasservedasourChiefFinancialOfficersinceOctober2012.FromJune2010toSeptember2012,Mr.FrankolaservedasChiefFinancialOfficerofYodlee,Inc.adataaggregationanddataanalyticsplatformcompany.PriortoYodlee,Mr.FrankolaservedasChiefFinancialOfficerofAriba,Inc.,asoftwareandinformationtechnologyservicescompany.Mr.Frankolahasalsoheldvariousotherseniorlevelfinancialandbusinessmanagementpositionsatseveralcompanies,includingIBMandAveryDennisonCorporation.Mr.FrankolaholdsaB.S.inaccountingfromPennStateUniversityandanM.B.A.fromNewYorkUniversitySternSchoolofBusinessandisaCertifiedPublicAccountant.

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Non‑‑Employee Directors

Martin Cole hasservedasamemberofourboardofdirectorssinceSeptember2014.PriortoretiringinAugust2014,Mr.ColeheldvariousrolesatAccenture,aprofessionalservicescompany,wherehehadworkedsince1980.Mostrecently,Mr.ColeservedastheChiefExecutiveoftheTechnologyGroupfrom2012to2014,ChiefExecutiveoftheCommunications,Media&TechnologyOperatingGroupfrom2007to2012,ChiefExecutiveoftheGovernmentOperatingGroupfrom2004to2006,ManagingPartneroftheOutsourcingandInfrastructureDeliveryGroupfrom2002to2004,andPartnerintheOutsourcingandGovernmentPracticesGroupfrom1989to2002,inadditiontonumerousotherleadershippositionsduringhistenureatAccenture.Mr.ColecurrentlyservesontheboardsofdirectorsoftheWesternUnionCompanyandWesternDigitalCorporation.Mr.ColeholdsaB.A.inliberalartsfromDartmouthCollegeandanM.A.inpublicaffairsfromtheUniversityofTexasatAustin.Mr.Colewasselectedtoserveasamemberofourboardofdirectorsduetohisextensiveexperienceasaformerexecutiveofficerofamultinationalmanagementconsulting,technologyservicesandoutsourcingcompanyandhisexperienceservingontheboardsofdirectorsofpubliccompanies.

Kimberly L. Hammonds hasservedasamemberofourboardofdirectorssinceMarch2017.Ms.HammondsisaMemberoftheManagementBoardandtheGroupChiefOperatingOfficerofDeutscheBankAG,aglobalfinancialservicescompany.ShejoinedDeutscheBankasGlobalChiefInformationOfficerandGlobalCo-HeadofGroupTechnology&OperationsinNovember2013.PriortoDeutscheBank,Ms.HammondsservedastheChiefInformationOfficerofTheBoeingCompany,aglobalaerospacecompany.BeforeBoeing,Ms.HammondsheldseniormanagementpositionsatDellCorporation,atechnologycompany,andFordMotorCompany,amultinationalautomaker,inproductengineering,manufacturing,marketingandinformationtechnology.Ms.HammondsservesontheboardofdirectorsofRedHat,Inc.,asoftwarecompany.Ms.HammondshasaB.S.inmechanicalengineeringfromtheUniversityofMichiganandanM.B.A.fromWesternMichiganUniversity.Ms.Hammondswasselectedtoserveonourboardofdirectorsduetoherexperienceworkingwithinformationtechnologycompanies.

Ping Li hasservedasamemberofourboardofdirectorssinceOctober2008.Mr.LiisaPartneratAccel,aventurecapitalfirm,wherehehasworkedsince2004.PriortoAccel,Mr.LiwasaseniorProductLineManagerandDirectorofCorporateDevelopmentatJuniperNetworks,Inc.from2000to2004.Mr.LihasalsopreviouslyworkedasastrategyconsultantforMcKinsey&Company,advisingtechnologyclientsintheirgrowthstrategies,from1998to1999.Mr.Licurrentlyservesontheboardsofdirectorsofseveralprivatecompanies,andpreviouslyservedontheboardsofdirectorsofNimbleStorage,Inc.,aflashstoragesolutionscompanyandYuMe,Inc.,avideoadvertisingcompany.Mr.LiholdsaA.B.ineconomicsfromHarvardUniversityandanM.B.A.fromStanfordUniversity.Mr.Liwasselectedtoserveonourboardofdirectorsduetohisinvestmentexperienceintheinformationtechnologyanddatastorageindustriesandandhisexperienceservingontheboardsofdirectorsofpubliccompanies.

Steve J. Sordello hasservedasamemberofourboardofdirectorssinceSeptember2014.Mr.SordelloiscurrentlyChiefFinancialOfficerofLinkedinCorporation,aprofessionalsocialnetworkingplatform,wherehehasworkedsinceJuly2007.PriortoLinkedin,Mr.SordellowasChiefFinancialOfficerofTiVoCorporation,adigitalrecordingcompany,fromAugust2006toJuly2007,andservedastheChiefFinancialOfficerofAsk.com(originallyknownasAskJeeves),awebsearchengine,fromMay1999toOctober2005.Mr.SordelloalsoservesontheboardofdirectorsofAtlassianCorporationPLC,anenterprisesoftwarecompany,andasamemberoftheBoardofTrusteesatSantaClaraUniversity.Mr.SordelloholdsaB.S.inmanagementandanM.B.A.fromSantaClaraUniversity.Mr.Sordellowasselectedtoserveasamemberofourboardofdirectorsduetohisoperationalandfinancialexpertisegainedasanexecutiveatseveralcompanies.

Michael A. Stankey hasservedasamemberofourboardofdirectorssinceFebruary2017.Mr.StankeyiscurrentlytheViceChairmanofWorkday,Inc.,acloud‑basedenterprisesoftwarecompany,apositionhehasheldsinceJune2015.HepreviouslyservedasWorkday'sPresidentandChiefOperatingOfficerfromSeptember2009toJune2015.PriortoWorkday,Mr.StankeywasaPartneratGreylockPartners,aventurecapitalfirm,fromOctober2007toSeptember2009.Mr.StankeyalsoservedastheChairmanandChiefExecutiveOfficerofPolyServe,Inc.,astoragevirtualizationsoftwarecompany,fromDecember2001untilitsacquisitionbyHPinApril2007.FromApril1993toDecember2001,Mr.Stankeyheldanumberofseniormanagementpositions,includingSeniorVicePresidentofNorthAmericanSales,atPeopleSoft,Inc.,anenterprisesoftwarecompany.

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Mr.StankeycurrentlyservesontheboardofdirectorsofWorkdayandofOkta,Inc.,twopubliccompanies,andofCode42Software,Inc.,aprivatecompany.Mr.StankeyholdsaB.B.A.fromtheUniversityofWisconsin‑EauClaire.Mr.Stankeywasselectedtoserveonourboardofdirectorsduetohisexperienceintheinformationtechnologyindustryandhisexperienceservingontheboardofdirectorsofapubliccompany.

Election of Officers

Ourexecutiveofficersareelectedby,andserveatthediscretionof,ourboardofdirectors.Therearenofamilyrelationshipsamonganyofourdirectorsorexecutiveofficers.

Board Composition

Thenumberofdirectorsisfixedbyourboardofdirectors,subjecttothetermsofourrestatedcertificateofincorporationandrestatedbylaws.Ourboardofdirectorscurrentlyconsistsofninememberswithtwovacancies.Currentlyservingmembersofourboardofdirectorswillcontinuetoserveasdirectorsuntiltheirresignationsoruntiltheirsuccessorsaredulyelectedbytheholdersofourcommonstock.Pursuanttoavotingandstandstillagreement,datedMarch28,2017,wehaveagreedthatourboardofdirectorswillnominateforelectionadirectordesignatedbyIntelateachannualmeetingofthestockholdersatwhichthetermofsuchdesigneeends.See“DescriptionofCapitalStock—CommonStock—VotingRights”and“CertainRelationshipsandRelated-PartyTransactions—VotingandStandstillAgreement.”

Ourrestatedcertificateofincorporationprovidesthatourboardofdirectorsisdividedintothreeclasseswithstaggeredthree‑yearterms.Uponexpirationofthetermofaclassofdirectors,directorsforthatclasswillbeelectedforthree-yeartermsattheannualmeetingofstockholdersintheyearinwhichthattermexpires.Asaresult,onlyoneclassofdirectorswillbeelectedateachannualmeetingofourstockholders,withtheotherclassescontinuingfortheremainderoftheirrespectivethree-yearterms.Eachdirector’stermcontinuesuntiltheelectionandqualificationofhisorhersuccessor,orhisorherearlierdeath,resignation,orremoval.Ourdirectorsaredividedamongthethreeclassesasfollows:

• ClassIdirectors,whoseinitialtermexpiresattheannualmeetingofstockholderstobeheldin2018,consistsofMr.Cole,Mr.ReillyandMr.Stankey;

• ClassIIdirectors,whoseinitialtermexpiresattheannualmeetingofstockholderstobeheldin2019,consistsofMr.OlsonandMr.Li;and

• ClassIIIdirectors,whoseinitialtermexpiresattheannualmeetingofstockholderstobeheldin2020,consistsofMr.SordelloandMs.Hammonds.

Inaddition,ourrestatedcertificateofincorporationandrestatedbylawsauthorizethatonlyourboardofdirectorsmayfillvacancies,includingnewlycreatedseats,ontheboardofdirectorsuntilthenextannualmeetingofstockholders,subjecttolimitedexceptions.Anyadditionaldirectorshipsresultingfromanincreaseinthenumberofdirectorswillbedistributedamongthethreeclassessothat,asnearlyaspossible,eachclasswillconsistofone‑thirdofthetotalnumberofdirectors.

Thisclassificationoftheboardofdirectorsandtheprovisionsdescribedabovemayhavetheeffectofdelayingorpreventingchangesinourcontrolormanagement.Ourrestatedcertificateofincorporationfurtherprovidesfortheremovalofadirectoronlyforcauseandbytheaffirmativevoteoftheholdersoftwo‑thirdsormoreofthesharesthenentitledtovoteatanelectionofourdirectors.See“DescriptionofCapitalStock—DefensiveMeasures—RestatedCertificateofIncorporationandRestatedBylawProvisions.”

Board Independence

OurcommonstockislistedontheNewYorkStockExchange.Thelistingrulesofthisstockexchangegenerallyrequirethatamajorityofthemembersofalistedcompany’sboardofdirectorsbeindependentwithinspecifiedperiodsfollowingthecompletionofaninitialpublicoffering.Inaddition,thelistingrulesgenerallyrequirethat,subjecttospecifiedexceptions,eachmemberofalistedcompany’saudit,compensationandgovernancecommitteesbeindependent.

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AuditcommitteemembersmustalsosatisfytheindependencecriteriasetforthinRule10A‑3undertheSecuritiesExchangeActof1934,asamended,orExchangeAct.InordertobeconsideredindependentforpurposesofRule10A‑3,amemberofanauditcommitteeofalistedcompanymaynot,otherthaninhisorhercapacityasamemberoftheauditcommittee,theboardofdirectors,oranyotherboardcommitteeaccept,directlyorindirectly,anyconsulting,advisory,orothercompensatoryfeefromthelistedcompanyoranyofitssubsidiaries,orbeanaffiliatedpersonofthelistedcompanyoranyofitssubsidiaries.CompensationcommitteemembersmustalsosatisfytheindependencecriteriaasrequiredbyRule10C‑1undertheExchangeAct.

OurboardofdirectorshasdeterminedthatnoneofthemembersofourboardofdirectorsotherthanMessrs.ReillyandOlsonhasarelationshipthatwouldinterferewiththeexerciseofindependentjudgmentincarryingouttheresponsibilitiesofadirectorandthateachofthemembersofourboardofdirectorsotherthanMessrs.ReillyandOlsonis“independent”asthattermisdefinedundertherulesoftheNewYorkStockExchange.

Lead Director

OurboardofdirectorshasappointedMr.ColetoserveasourLeadDirector.AsLeadDirector,Mr.Colehasthefollowingrolesandresponsibilities:

• callingmeetingsofourindependentdirectorsasmaybenecessaryfromtimetotime;

• presidingexecutivesessionsofourindependentdirectors;

• advisingourChiefExecutiveOfficer,Chairmanandothermembersofseniormanagementonbusinessstrategyandleadershipdevelopment,asappropriate;

• servingasprincipalliaisonbetweenourindependentdirectorsandourChiefExecutiveOfficerandChairman;

• discussinganysignificantconclusionsorrequestsarisingfromtheindependentdirectorsessionswithourChiefExecutiveOfficerorChairman,andotherwisecommunicatingfromtimetotimewithourChiefExecutiveOfficerandChairman;

• disseminatinginformationtotherestofourboardofdirectorsasappropriate;

• beingavailable,asappropriate,forcommunicationwithstockholders;

• providingleadershiptoourboardofdirectorsifcircumstancesariseinwhichtheroleofourChiefExecutiveOfficerorChairmanmaybe,ormaybeperceivedtobe,inconflict;

• reviewingandapprovingagendasandmeetingschedulestoassurethatthereissufficienttimefordiscussionofallagendaitems,andinformationprovidedtoourboardofdirectors;and

• performingotherdutiesasmaybe,fromtimetotime,setforthinourrestatedbylawsorrequestedbyourboardofdirectorstoassistitinthefulfillmentofitsresponsibilities,byindividualdirectors,byourChiefExecutiveOfficerorbyourChairman.

OurboardleadershipstructureallowsustoleveragetheexperienceofourChiefExecutiveOfficer,expertiseandlong‑termperspectiveofourChairmanandtheindependentperspectiveofourLeadDirector.Webelievethatthisstructure,combinedwithourstrongcommitteesystem,meetsthecurrentcorporategovernanceneedsandoversightresponsibilitiesoftheboardofdirectors.

Board Committees

Ourboardofdirectorshasestablishedanauditcommittee,acompensationcommitteeandanominatingandgovernancecommittee.Thecompositionandresponsibilitiesofeachcommitteearedescribedbelow.Copiesofthechartersforeachcommitteeareavailableontheinvestorrelationsportionofourwebsite,www.cloudera.com.Membersserveonthesecommitteesuntiltheirresignationsoruntilotherwisedeterminedbytheboardofdirectors.

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Audit Committee

OurauditcommitteeiscomprisedofMr.Sordello,whoisthechairoftheauditcommittee,Mr.Cole,andMr.Stankey.ThecompositionofourauditcommitteemeetstherequirementsforindependenceunderthecurrentNewYorkStockExchangelistingstandardsandSecuritiesandExchangeCommission(SEC)rulesandregulations.Eachmemberofourauditcommitteeisfinanciallyliterate.Inaddition,ourboardofdirectorshasdeterminedthatMr.SordelloisanauditcommitteefinancialexpertwithinthemeaningofItem407(d)ofRegulationS‑KoftheSecuritiesAct.

Allauditservicestobeprovidedtousandallpermissiblenon‑auditservicestobeprovidedtousbyourindependentregisteredpublicaccountingfirmwillbeapprovedinadvancebyourauditcommittee.Ourauditcommitteerecommended,andourboardofdirectorsadopted,acharterforourauditcommittee.Ourauditcommittee,amongotherthings:

• selectsafirmtoserveastheindependentregisteredpublicaccountingfirmtoauditourfinancialstatements;

• helpstoensuretheindependenceoftheindependentregisteredpublicaccountingfirm;

• discussesthescopeandresultsoftheauditwiththeindependentregisteredpublicaccountingfirm,andreviews,withmanagementandtheindependentaccountants,ourinterimandyear‑endoperatingresults;

• developsproceduresforemployeestoanonymouslysubmitconcernsaboutquestionableaccountingorauditmatters;and

• considerstheadequacyofourinternalaccountingcontrolsandauditprocedures.

Compensation Committee

OurcompensationcommitteeiscomprisedofMr.Li,whoisthechairofthecompensationcommittee,Mr.ColeandMs.Hammonds.ThecompositionofourcompensationcommitteemeetstherequirementsforindependenceundercurrentNewYorkStockExchangelistingstandardsandSECrulesandregulations.Atleasttwomembersofthiscommitteearealsonon‑employeedirectors,asdefinedpursuanttoRule16b‑3promulgatedundertheExchangeAct,andeachmemberofthiscommitteeisanoutsidedirector,asdefinedpursuanttoSection162(m)oftheInternalRevenueCodeof1986,asamended,ortheCode.Thepurposeofourcompensationcommitteeistodischargetheresponsibilitiesofourboardofdirectorsrelatingtocompensationofourexecutiveofficers.Ourboardofdirectorsadoptedacharterforourcompensationcommittee.Ourcompensationcommittee,amongotherthings:

• reviewsanddeterminesthecompensationofourexecutiveofficersandrecommendstoourboardofdirectorsthecompensationforourdirectors;

• administersourstockandequityincentiveplans;

• reviewsandmakesrecommendationstoourboardofdirectorswithrespecttoincentivecompensationandequityplans;and

• establishesandreviewsgeneralpoliciesrelatingtocompensationandbenefitsofouremployees.

Nominating and Governance Committee

ThenominatingandgovernancecommitteeiscomprisedofMr.Cole,whoisthechairofthenominatingandgovernancecommittee,Ms.HammondsandMr.Stankey.ThecompositionofournominatinggovernancecommitteemeetstherequirementsforindependenceunderthecurrentNewYorkStockExchangelistingstandardsandSECrulesandregulations.Ourcompensationcommitteerecommended,andourboardofdirectorsadopted,acharterforournominatingandgovernancecommittee.Ournominatingandgovernancecommittee,amongotherthings:

• identifies,evaluatesandrecommendsnomineestoourboardofdirectorsandcommitteesofourboardofdirectors;

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• conductssearchesforappropriatedirectors;

• evaluatestheperformanceofourboardofdirectorsandofindividualdirectors;

• considersandmakesrecommendationstotheboardofdirectorsregardingthecompositionoftheboardanditscommittees;

• reviewsdevelopmentsincorporategovernancepractices;

• evaluatestheadequacyofourcorporategovernancepracticesandreporting;and

• makesrecommendationstoourboardofdirectorsconcerningcorporategovernancematters.

Code of Business Conduct and Ethics

Thefulltextofourcodeofbusinessconductandethicsispostedontheinvestorrelationssectionofourwebsite.Weintendtodisclosefutureamendmentstocertainprovisionsofourcodeofbusinessconductandethics,orwaiversoftheseprovisions,onourwebsiteand/orinpublicfilings.

Compensation Committee Interlocks and Insider Participation

SinceFebruary1,2016,thefollowingmembersorformermembersofourboardofdirectorshaveatonetimebeenmembersofourcompensationcommittee:Mr.Li,Mr.Cole,Ms.HammondsandformerdirectorsRichardH.WilliamsandScottDietzen.Noneofthemhasatanytimebeenoneofourofficersoremployees.Noneofourexecutiveofficersservesorinthepasthasservedasamemberoftheboardofdirectorsorcompensationcommitteeofanyentitythathasoneormoreofitsexecutiveofficersservingonourboardofdirectorsorourcompensationcommittee.

Director Compensation

Ourboardofdirectorshasadoptedacompensationprogramwithrespecttothecompensationofournon‑employeedirectorswhoarenotservingduetoanaffiliationwithourinvestors.Pursuanttothisprogram,eachboardmemberreceivesannualcashcompensationof$35,000,andtheleaddirectorreceivesannualcashcompensationof$25,000.Additionally,annualcashcompensationforcommitteemembershipisasfollows:

• auditcommitteechair:$20,000;

• auditcommitteemember:$10,000;

• compensationcommitteechair:$15,000;

• compensationcommitteemember:$7,500;

• nominatingandgovernancecommitteechair:$10,000;and

• nominatingandgovernancecommitteemember:$5,000.

Inaddition,eachnewnon‑employeedirectoriseligibletoreceive$450,000worthofrestrictedstockunits(RSUs),withone‑thirdoftheRSUsvestingonthefirstannualanniversaryofthevestingcommencementdateandtheremainingRSUsvestingquarterlyoverthesubsequenttwoyears,andeachcontinuingdirectoriseligibletoreceive$230,000worthofRSUsannually,withalloftheunitsvestingonthefirstannualanniversaryofthevestingcommencementdate.Uponachangeofcontrolofourcompany,allofunvestedequityawardsgrantedtomembersofourboardofdirectorswillimmediatelyvest.

Messrs.ReillyandOlson,ourChiefExecutiveOfficerandChiefStrategyOfficer,respectively,receivednocompensationfortheirserviceasdirectors.Mr.LiandAneelBhusri,aformerdirector,alsoreceivednocompensationfortheirservicesasdirectors.Mr.BhusriandDr.DietzenresignedfromourboardofdirectorsonDecember14,2016.

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Thefollowingtablepresentsthetotalcompensationforeachpersonwhoservedasanon‑employeememberofourboardofdirectorsduringtheyearendedJanuary31,2017.

Name

FeesEarned or

Paid in Cash RSU

Awards (1) Total

MartinCole $37,000 $241,020 $278,010ScottDietzen(2) 30,000 476,983(3) 506,983StevenJ.Sordello 50,000 241,020 291,020KimberlyS.Stevenson(4) 30,000(5) —(6) 30,000RichardH.Williams(7) 45,000 241,020 286,020___________(1) Theamountsreportedinthiscolumnrepresenttheaggregategrantdatefairvalueofequityawardsgrantedunderour2008EquityIncentivePlantoourdirectorsduringthe

yearendedJanuary31,2017ascomputedinaccordancewithFASBASCTopic718.TheassumptionsusedincalculatingthedollaramountrecognizedforfinancialstatementreportingpurposesoftheequityawardsreportedinthiscolumnaresetforthinNote10toourconsolidatedfinancialstatementsincludedinthisprospectus.Notethattheamountsreportedinthiscolumnreflecttheaccountingcostfortheseequityawardsanddonotcorrespondtotheactualeconomicvaluethatmaybereceivedbyourdirectorsfromtheequityawards.

(2) Dr.DietzenresignedfromtheboardofdirectorsonDecember14,2016.(3) Includestheincrementalfairvalueof$235,963associatedwiththeaccelerationofvestingofalloutstandingRSUawardsonDecember14,2016inconnectionwithDr.

Dietzen’sresignation.(4) Ms.StevensonresignedfromtheboardofdirectorsonFebruary3,2017.(5) FeepaidtoIntelinrespectofMs.Stevenson’sservice.(6) Ms.Stevensonwaivedherrighttoreceiveanyequitycompensationinconnectionwithherdirectorship.(7) Mr.WilliamsresignedfromtheboardofdirectorsonMarch23,2017.

Inconnectionwiththeirappointmentstoourboard,wegranted25,210RSUstoeachofMr.StankeyandMs.Hammondspursuanttoourdirectorcompensationprogram.

Ournon‑employeedirectorswhoreceivedcompensationfortheirservicesinaccordancewiththecompensationprogramdescribedaboveheldthefollowingnumberofstockoptionsandRSUsasofJanuary31,2017.

Name OutstandingRSU Awards

Shares subject toOutstanding

Options

MartinCole 16,830 —ScottDietzen — 164,644StevenJ.Sordello 16,830 —KimberlyS.Stevenson — —RichardH.Williams 11,205 174,000

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EXECUTIVE COMPENSATION

Summary Compensation Table

Thefollowingtableprovidesinformationconcerningallplanandnon‑plancompensationawardedto,earnedbyorpaidtoourChiefExecutiveOfficerandeachofourtwoothermosthighlycompensatedofficers,whomwecollectivelyrefertoas“namedexecutiveofficers,”duringtheyearsendedJanuary31,2016and2017.

Name and Principal Position FiscalYear Salary Bonus

StockAwards (1)

OptionAwards (2)

Non‑‑Equity IncentivePlan Compensation Total

ThomasJ.Reilly 2017 $341,667(4) $ — $ 4,302,000 $ — $269,167(3) $ 4,643,667Chief Executive Officer

2016

$300,000

$ —

$ 5,520,690

$ 1,421,330

$138,000(5)

$ 7,380,020

JimFrankola 2017 $337,919(6) $ — $ 2,516,670 $ — $137,594(3) $ 2,854,589Chief Financial Officer

2016

$268,750(7)

$ —

$ —

$ —

$78,000(5)

$ 346,750

MichaelA.Olson 2017 $250,000 $ — $ 2,151,000 $ — $100,938(3) $ 2,401,000

Chief Strategy Officer

2016$250,000

$ —

$ —

$ —

$72,000(5)

$ 322,000

___________(1) Theamountsreportedinthiscolumnrepresenttheaggregategrantdatefairvalueoftherestrictedstockunits(RSUs)grantedunderour2008StockIncentivePlantoour

namedexecutiveofficersinfiscal2016andfiscal2017ascomputedinaccordancewithFASBASCTopic718.TheassumptionsusedincalculatingthedollaramountrecognizedforfinancialstatementreportingpurposesoftheequityawardsreportedinthiscolumnaresetforthinNote10toourconsolidatedfinancialstatementsincludedinthisprospectus.Notethattheamountsreportedinthiscolumnreflecttheaccountingvaluefortheseequityawardsanddonotcorrespondtotheactualeconomicvaluethatmaybereceivedbyournamedexecutiveofficersfromtheequityawards.

(2) Theamountsreportedinthiscolumnrepresenttheaggregategrantdatefairvalueofthestockoptionsgrantedunderour2008StockIncentivePlantoournamedexecutiveofficersinfiscal2016ascomputedinaccordancewithFASBASCTopic718.TheassumptionsusedincalculatingthedollaramountrecognizedforfinancialstatementreportingpurposesoftheequityawardsreportedinthiscolumnaresetforthinNote10toourconsolidatedfinancialstatementsincludedinthisprospectus.Notethattheamountsreportedinthiscolumnreflecttheaccountingvaluefortheseequityawardsanddonotcorrespondtotheactualeconomicvaluethatmaybereceivedbyournamedexecutiveofficersfromtheequityawards.

(3) TheseamountsreflectbonusesearnedbyMessrs.Reilly,FrankolaandOlsonbaseduponourachievementoffinancialobjectivesandmilestones.Mr.Reillywaseligibletoearnatargetbonusof$316,667.Mr.Frankolawaseligibletoearnatargetbonusof$161,875.Mr.Olsonwaseligibletoearnatargetbonusof$118,750.

(4) Mr.Reilly’sbasesalarywasincreasedto$350,000effectiveApril1,2016.(5) TheseamountsreflectbonusesearnedbyMessrs.Reilly,FrankolaandOlsonbaseduponourachievementoffinancialobjectivesandmilestones.Mr.Reillywaseligibleto

earnatargetbonusof$150,000.Mr.Frankolawaseligibletoearnatargetbonusof$84,688.Mr.Olsonwaseligibletoearnatargetbonusof$78,125.(6) Mr.Frankola’sbasesalarywasincreasedto$350,000effectiveApril1,2016.(7) Mr.Frankola’sbasesalarywasincreasedto$275,000effectiveMay1,2015.

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2017 Outstanding Equity Awards at Year‑‑End Table

ThefollowingtableprovidesinformationregardingtheunexercisedstockoptionsandunvestedRSUsheldbyournamedexecutiveofficersasofJanuary31,2017.

Option Awards Stock Awards

GrantDate (1)

Number of SecuritiesUnderlying Unexercised

Options Exercise

Price

Expiration

Date

Number ofShares thatHave NotVested (2)

MarketValue of

Shares thatHave NotVested (3)Name Exercisable Unexercisable

ThomasJ.Reilly 6/28/2013(4) 7,335,907 — $ 3.21 6/27/2023 3/26/2015(5) — 89,000 16.24 3/25/2025 3/26/2015(6) 207,000 $ 3,405,150 3/17/2016(7) 200,000 3,290,000JimFrankola 10/9/2012(8) 526,470 — 1.72 10/8/2022 11/8/2013(9) 54,166 45,834 3.64 11/7/2023 11/8/2013(10) 29,166 70,834 3.64 11/7/2023 1/31/2015(11) — 41,000 16.02 1/30/2025 1/31/2015(12) 95,000 1,562,750 3/17/2016(13) 117,000 1,924,650MichaelA.Olson 3/30/2012(14) 165,300 — 1.68 3/29/2022 6/28/2013(15) 1,374,999 208,335 3.21 6/27/2023 1/31/2015(16) — 41,000 16.02 1/30/2025 1/31/2015(17) 95,000 1,562,750 3/17/2016(18) 100,000 1,645,000___________(1) Alloftheoutstandingequityawardsweregrantedunderour2008StockIncentivePlanandaresubjecttoaccelerationofvestingasdescribedin“—TerminationorChange

inControlArrangements”below.(2) TheoutstandingRSUsweremodifiedasofMarch2017.See“Management’sDiscussionandAnalysisofFinancialConditionsandResultsofOperations‑Significant

ImpactsofStock‑basedCompensationExpense‑RestrictedStockUnits.”(3) Themarketvalueforourcommonstockisbasedonthepublicofferingpriceofourcommonstockof$16.45pershare.(4) 1/4thoftheoptionvestedonJune18,2014and1/48thvestsmonthlythereafter.(5) 1/24thoftheoptionvestsmonthlybeginningonJune18,2017.(6) OurboardofdirectorsapprovedthisawardonMarch26,2015.TheseRSUsvestandaresettleduponthesatisfactionofbothaservice‑basedrequirementandaliquidity

eventrequirement.Thevestingcommencementdate(VCD)fortheseRSUsisJune15,2017.Theservice‑basedrequirementwillbesatisfiedwithrespectto1/8thoftheRSUsoneachquarterlyanniversaryoftheVCD.TheliquidityeventrequirementwassatisfieduponMr.Reilly’scontinuedemploymentthroughApril27,2017,theeffectivedateofourinitialpublicoffering.Onthatdate,thoseRSUsforwhichtheservice‑basedvestingrequirementhasbeensatisfiedvestedand1/8thoftheRSUswillcontinuetovestoneachquarterlyanniversarytheVCDthereafter.

(7) OurboardofdirectorsapprovedthisawardonMarch17,2016.TheseRSUsvestandaresettleduponthesatisfactionofbothaservice‑basedrequirementandaliquidityeventrequirement.TheVCDfortheseRSUsisMarch15,2017.Theservice‑basedrequirementwillbesatisfiedwithrespectto1/12thoftheRSUsoneachquarterlyanniversaryoftheVCD.TheliquidityeventrequirementwassatisfieduponMr.Reilly’scontinuedemploymentthroughApril27,2017,theeffectivedateofourinitialpublicoffering.Onthatdate,thoseRSUsforwhichtheservice‑basedvestingrequirementhasbeensatisfiedvestedand1/12thoftheRSUswillcontinuetovestoneachquarterlyanniversarytheVCDthereafter.

(8) 1/4thoftheoptionvestedatOctober1,2013andanadditional1/48thvestedmonthlythereafter.(9) 1/48thoftheoptionvestsmonthlybeginningonDecember1,2014.(10) 1/48thoftheoptionvestsmonthlybeginningonDecember1,2015.(11) 1/24thoftheoptionvestsmonthlybeginningonJanuary1,2017.(12) OurboardofdirectorsapprovedthisawardonJanuary31,2015.TheseRSUsvestandaresettleduponthesatisfactionofbothaservice‑basedrequirementandaliquidity

eventrequirement.TheVCDfortheseRSUsisDecember15,2016.Theservice‑basedrequirementwillbesatisfiedwithrespectto1/8thoftheRSUsoneachquarterlyanniversaryoftheVCD.The

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liquidityeventrequirementwassatisfieduponMr.Frankola’scontinuedemploymentthroughApril27,2017,theeffectivedateofourinitialpublicoffering.Onthatdate,thoseRSUsforwhichtheservice‑basedvestingrequirementhasbeensatisfiedvestedand1/8thoftheRSUswillcontinuetovestoneachquarterlyanniversaryoftheVCDthereafter.

(13) OurboardofdirectorsapprovedthisawardonMarch17,2016.TheseRSUsvestandaresettleduponthesatisfactionofbothaservice‑basedrequirementandaliquidityeventrequirement.TheVCDfortheseRSUsisMarch15,2016.Theservice‑basedrequirementwillbesatisfiedwithrespectto1/16thoftheRSUsoneachquarterlyanniversaryoftheVCD.TheliquidityeventrequirementwassatisfieduponMr.Frankola’scontinuedemploymentthroughApril27,2017,theeffectivedateofourinitialpublicoffering.Onthatdate,thoseRSUsforwhichtheservice‑basedvestingrequirementhasbeensatisfiedvestedand1/16thoftheRSUswillcontinuetovestoneachquarterlyanniversaryoftheVCDthereafter.

(14) 1/4thoftheoptionvestedonMarch29,2013and1/48thvestedmonthlythereafter.(15) 1/48thoftheoptionvestsmonthlybeginningonJune27,2013.(16) 1/24thoftheoptionvestsmonthlybeginningonJanuary1,2017.(17) OurboardofdirectorsapprovedthisawardonJanuary31,2015.TheseRSUsvestandaresettleduponthesatisfactionofbothaservice‑basedrequirementandaliquidity

eventrequirement.TheVCDfortheseRSUsisDecember15,2016.Theservice‑basedrequirementwillbesatisfiedwithrespectto1/8thoftheRSUsoneachquarterlyanniversaryoftheVCD.TheliquidityeventrequirementwassatisfieduponMr.Olson’scontinuedemploymentthroughApril27,2017,theeffectivedateofourinitialpublicoffering.Onthatdate,thoseRSUsforwhichtheservice‑basedrequirementhasbeensatisfiedvestedand1/8thoftheRSUswillcontinuetovestoneachquarterlyanniversarytheVCDthereafter.

(18) OurboardofdirectorsapprovedthisawardonMarch17,2016.TheseRSUsvestandaresettleduponthesatisfactionofbothaservice‑basedrequirementandaliquidityeventrequirement.TheVCDfortheseRSUsisMarch15,2017.Theservice‑basedrequirementwillbesatisfiedwithrespectto1/12thoftheRSUsoneachquarterlyanniversaryoftheVCD.TheliquidityeventrequirementwassatisfieduponMr.Olson’scontinuedemploymentthroughApril27,2017,theeffectivedateofourinitialpublicoffering.Onthatdate,thoseRSUsforwhichtheservice‑basedrequirementhasbeensatisfiedvestedand1/12thoftheRSUswillcontinuetovestoneachquarterlyanniversarytheVCDthereafter.

Employment, Severance and Change of Control Arrangements

Offer Letters and Employment Agreements

WehaveenteredintoofferletterswithMessrs.ReillyandMr.OlsonandanemploymentagreementwithMr.Frankola.Eachofthesearrangementsprovideforat‑willemploymentandgenerallyincludethenamedexecutiveofficer’sinitialbasesalary,anindicationofeligibilityforanannualcashincentiveawardopportunityandequityawards.Inaddition,eachofournamedexecutiveofficershasexecutedaformofourstandardconfidentialinformationandinventionassignmentagreement.Anypotentialpaymentsandbenefitsdueuponaterminationofemploymentorachangeincontrolofusarefurtherdescribedin“—

TerminationorChangeinControlArrangements”below.

Thomas J. Reilly

WeenteredintoanofferletterwithMr.Reilly,ourChiefExecutiveOfficer,onMay22,2013.Pursuanttotheofferletter,Mr.Reilly’sinitialbasesalarywasestablishedat$300,000peryear.Inaddition,Mr.Reillyiseligibletoreceiveanannualcashbonusofupto$150,000basedontheachievementofmutuallyagreed‑uponobjectives.OnJune28,2013,inaccordancewiththetermsofhisofferletter,Mr.Reillywasgrantedastockoptiontopurchase7,335,907sharesofourcommonstockatanexercisepriceof$3.21pershare,whichwasequaltothefairmarketvalueofourcommonstockonthedatetheoptionwasgrantedasdeterminedbyourboardofdirectors.Thisoptionvestedwithrespectto25%ofthesharessubjecttoitonJune18,2014,and1/48thofthesharessubjecttotheoptionvestedor,subjecttoMr.Reilly’scontinuedservice,willcontinuetovestratablyonthefirstdayofeachmonthlyanniversaryoverthefollowing36monthperiod.

WhileMr.Reilly’sofferletterprovidesthathisemploymentisatwillandmaybeterminatedatanytime,withorwithoutcause,hisofferletteralsoprovidesthathewouldbeentitledtoseverancebenefitsintheeventweterminatehisemploymentwithoutcause(asdefinedintheofferletter)orheresignsforgoodreason(asdefinedintheofferletter).However,onDecember13,2016,Mr.ReillyenteredintoaSeveranceandChangeinControlAgreement,whichsupersedestheseverancebenefitsMr.Reillywouldhaveotherwisebeenentitledtoreceiveunderhisofferletter.ThetermsoftheseverancebenefitsundertheSeveranceandChangeinControlAgreementwithMr.Reillyaredescribedin“—TerminationorChangeinControlArrangements”below.

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Jim Frankola

WeenteredintoanemploymentagreementwithMr.Frankola,ourChiefFinancialOfficer,onSeptember10,2012.Pursuanttotheagreement,Mr.Frankola’sinitialbasesalarywasestablishedat$250,000peryear.Inaddition,Mr.Frankolawasinitiallyeligibletoreceiveanannualcashbonusofupto$50,000basedontheachievementofcertainperformancegoals,whicharesetbytheboardofdirectorsafterconsultingwithMr.Frankola.OnOctober9,2012,inaccordancewiththetermsofhisagreement,Mr.Frankolawasgrantedastockoptiontopurchase1,026,470sharesofourcommonstockatanexercisepriceof$1.72pershare,whichwasequaltothefairmarketvalueofourcommonstockonthedatetheoptionwasgrantedasdeterminedbyourboardofdirectors.Thisoptionvestedwithrespectto25%ofthesharessubjecttoitonOctober1,2013and1/48thofthesharessubjecttotheoptionvestedonthefirstdayofeachmonthlyanniversaryratablyoverthefollowing36monthperiod.

WhileMr.Frankola’semploymentagreementprovidesthathisemploymentisatwillandmaybeterminatedatanytime,withorwithoutcause,hisemploymentagreementalsoprovidesthathewouldbeentitledtoseverancebenefitsintheeventhisemploymentisterminatedbytheCompanywithoutcause(asdefinedintheemploymentagreement)orheresignsforgoodreason(asdefinedintheemploymentagreement).However,onDecember5,2016,Mr.FrankolaenteredintoaSeveranceandChangeinControlAgreement,whichsupersedestheseverancebenefitsMr.Frankolawouldhaveotherwisebeenentitledtoreceiveunderhisemploymentagreement.ThetermsoftheseverancebenefitsundertheSeveranceandChangeinControlAgreementwithMr.Frankolaaredescribedin“—TerminationorChangeinControlArrangements”below.

Michael A. Olson

WeenteredintoanofferletterwithMr.Olson,ourco‑founder,ChairmanandChiefStrategyOfficer,inOctober2008.Pursuanttotheofferletter,Mr.OlsoninitiallyservedasourPresidentandChiefExecutiveOfficerwithaninitialbasesalarytobemutuallyagreed.OnAugust22,2008,pursuanttothetermsofhisofferletter,Mr.Olsonwasgrantedtherighttopurchase5,000,000sharesofrestrictedstockfor$0.000025pershare,whichwasequaltothefairmarketvalueofourcommonstockonthedatethesharesweregrantedasdeterminedbyourboardofdirectors.Thisrestrictedstockawardvestedwithrespectto15%ofthesharessubjecttoitonthefirstdayofeachmonthlyanniversaryratablyoverthefollowing36monthperiod.

WhileMr.Olson’sofferletterprovidesthathisemploymentisatwillandmaybeterminatedatanytime,withorwithoutcause,hisofferletteralsoprovidesthathewouldbeentitledtoseverancebenefitsintheeventhisemploymentisterminatedbytheCompanywithoutcause(asdefinedintheofferletter)orheresignsonaccountofaconstructivetermination(asdefinedintheofferletter).However,onDecember5,2016,Mr.OlsonenteredintoaSeveranceandChangeinControlAgreement,whichsupersedestheseverancebenefitsMr.Olsonwouldhaveotherwisebeenentitledtoreceiveunderhisofferletter.ThetermsoftheseverancebenefitsundertheSeveranceandChangeinControlAgreementwithMr.Olsonaredescribedin“—TerminationorChangeinControlArrangements”below.

Termination or Change in Control Arrangements

WeenteredintoSeveranceandChangeinControlAgreementswitheachofthenamedexecutiveofficersinDecember2016.Pursuanttotheseagreements,wehaveagreedtomakecertainpaymentsandprovidecertainbenefitsuponterminationofemploymentbyuswithoutcause(asdefinedintheapplicableSeveranceandChangeinControlAgreement)orbytheemployeeforgoodreason(asdefinedintheapplicableSeveranceandChangeinControlAgreement).Thesepaymentsandbenefitsdependonwhetherornotsuchterminationoccursinconnectionwithachangeincontrol(asdefinedintheapplicableSeveranceandChangeinControlAgreement)andwillbesubjecttothenamedexecutiveofficer’sexecutionandnon‑revocationofageneralreleaseofclaimsinaformprescribedbyus.

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Iftheterminationofanamedexecutiveofficeroccursduringtheperiodcommencingthreemonthspriortoandendingtwelvemonthsfollowingachangeincontrol,thenamedexecutiveofficerwillbeentitledtoreceive:

(i) alumpsumpaymentequaltothesumof:

(a) hisannualbasesalary,

(b) hisannualtargetbonus(calculatedasifallapplicablebonustargetswereachieved)and

(c) aproratedportionofhisannualtargetbonus(calculatedasifallapplicablebonustargetswereachievedandbasedonthenumberofdaysworkedduringthebonusperiod);

(ii) twelvemonthsofCOBRApremiums(orataxablepaymentinanamountequaltosuchpremiums);

(iii) acceleratedvestingof100%ofalloutstandingequityawards;and

(iv) atwelvemonthpost‑terminationexercisewindowforalloutstandingnon‑qualifiedstockoptions.

Iftheterminationofanamedexecutiveofficerdoesnotoccurduringtheperiodcommencingthreemonthspriortoandendingtwelvemonthsfollowingachangeincontrol,thenamedexecutiveofficerwillbeentitledtoreceive:

(i) alumpsumpaymentequaltothesumof:

(a) hisannualbasesalaryand

(b) aproratedportionofhisannualtargetbonus(calculatedasifallapplicablebonustargetswereachievedandbasedonthenumberofdaysworkedduringthebonusperiod);

(ii) twelvemonthsofCOBRApremiums(orataxablepaymentinanamountequaltosuchpremiums);and

(iii) atwelvemonthpost‑terminationexercisewindowforalloutstandingnon‑qualifiedstockoptions.

PursuanttotheSeveranceandChangeinControlAgreements,eachofnamedexecutiveofficershasalsoagreedtorefrainfromcompetingwithuswhileemployedwithourcompanyandtorefrainfromsolicitinganyofouremployeesorconsultantsduring,andfortheone‑yearperiodfollowing,hisemployment.

Employee Benefit Plans

2008 Equity Incentive Plan

Ourboardofdirectorsadoptedour2008EquityIncentivePlan,or2008Plan,onAugust22,2008,whichourstockholdersalsoapprovedonAugust22,2008,andwhichhasbeenamendedfromtimetotimethereafter.Our2017EquityIncentivePlan,or2017Plan,becameeffectiveonApril27,2017,theeffectivedateofourinitialpublicoffering.The2008Planterminatedconcurrentlywiththeeffectivenessofour2017Planand,asaresult,wehavenotgranted,andwillnotgrant,anyadditionalawardsunderthe2008Planfollowingthatdate.However,anyoutstandingstockoptionsorRSUsgrantedunderthe2008Planremainoutstanding,subjecttothetermsofour2008Planandapplicableawardagreements,untilsuchsharesareissuedunderthoseawards(byexerciseofstockoptionsorsettlementofRSUs)oruntiltheawardsterminateorexpirebytheirterms.

Our2008Planprovidedforthegrantofincentivestockoptions,withinthemeaningofSection422oftheInternalRevenueCodeof1986,asamended,ortheCode,toouremployeesoranyparentorsubsidiary’semployeesandforthegrantofnonstatutorystockoptionstoouremployees,directors,consultantsandanyparentorsubsidiary’semployeesandconsultants.RSUs,stockappreciationrights,stockawards,andrestrictedstockmayalsohavebeengrantedunderthe2008Plan.WegrantedonlyRSUsandstockoptionsunderour2008Plan.Theexercisepriceofstockoptionsgrantedunderour2008Planmustbeatleastequaltothefairmarketvalueofourcommonstockonthedateofgrantandthetermofthestockoptionsmaynotexceedtenyears.Withrespecttoincentivestockoptionsgrantedtoanyemployeewhoowns10%ormoreofthevotingpowerofallclassesofouroutstandingstockasofthegrantdate,thetermoftheoptionmustnotexceedfiveyearsandtheexercisepricemustequalatleast

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110%ofthefairmarketvalueofourcommonstockonthegrantdate.RSUsgrantedunderour2008Planrepresenttherighttoreceivesharesofourcommonstockorcashpaymentataspecifiedfuturedateandmaybesubjecttocontinuousserviceorperformancevestingorliquidity‑eventvestingrequirements.

Intheeventofcertaineventsthatresultinachangetoourcorporateorcapitalstructure,includingastockdividend,stocksplit,recapitalizationorothersimilarevent,withoutthereceiptofapplicableconsiderationandotherthananormalcashdividend,ourboardofdirectorsshallmakeproportionaladjustmentstothemaximumnumberandkindofsecuritiesthataresubjecttoanyoutstandingawardsunderour2008EquityIncentivePlan.

Ifweexperienceacompanytransaction(asdefinedinour2008Plan)thatisnotarelatedpartytransaction(asdefinedinour2008Plan),unlessourboardotherwisedetermineswithrespecttoaparticularawardintheagreementevidencingtheawardorinawrittenemployment,servicesorotheragreement,outstandingawardsunderour2008Plan,includinganyvestingprovisions,maybeassumedorsubstitutedbythesuccessorcompany.Thevestingofoutstandingawardsthatarenotassumedorsubstitutedwillbeacceleratedandthenwillterminateupontheclosingofthecompanytransaction.Alternatively,upontheclosingofacompanytransaction,ourboardofdirectorsmayinsteadelecttoterminateanyoutstandingoptionorstockappreciationrightinexchangeforacashpaymentequalto,foreachshareofcommonstocksubjecttosuchaward(eithertotheextentthenvestedandexercisableorwhetherornotthenvestedandexercisable),thefairmarketvalueoftheconsiderationreceivablebyholdersofcommonstockforeachsharelesstheexercisepricepershare.

AsofJuly31,2017,thereremainedoutstandingunderour2008Plan,(i)optionstopurchase22,127,917sharesofourcommonstockand(ii)RSUsthatmaybesettledfor22,841,098sharesofourcommonstock.TheoptionsoutstandingasofJuly31,2017hadaweighted-averageexercisepriceof$4.72pershare.

Gazzang 2008 Stock Purchase and Option Plan

InconnectionwithouracquisitionofGazzang,Inc.inJune2014,ourboardofdirectorsapprovedtheassumptionofunvestedstockoptionsheldbycontinuingemployeesintheacquisition.Effectiveasoftheclosingoftheacquisition,theassumedstockoptionsrepresentedstockoptionstopurchasesharesofourcommonstock.Thesestockoptionswereassumedonsubstantiallythesametermsandconditionsasappliedtosuchstockoptionsimmediatelypriortotheconsummationoftheacquisition,exceptthatthenumberofsharesofourcommonstocksubjecttoeachoptionandtheexercisepriceofeachstockoptionwereadjustedinaccordancewiththetermsofthemergeragreement.Inaddition,eachassumedstockoptionwastreatedfortaxpurposesasanonqualifiedstockoption.

UponclosingoftheacquisitionofGazzang,Inc.andafterapplicationoftheadjustmentstothenumberofsharesofcommonstocksubjecttotheassumedstockoptionsinconnectionwiththeacquisition,64,574sharesofourcommonstockweresubjecttotheassumedstockoptions.AsofJuly31,2017,optionstopurchase1,008shareshadbeenexercised,optionstopurchase10,341shareshadexpiredunexercisedandoptionstopurchase53,225sharesremainedoutstanding.Anysharessubjecttotheassumedoptionsthatarecanceled,repurchasedorforfeiteddonotagainbecomeavailableforgrantunderthe2017Plan.Sincetheclosingoftheacquisition,wehavenotgrantedandwillnotgrantanystockoptionsorotherawardsundertheGazzang,Inc.AmendedandRestated2008StockPurchaseandOptionPlan,orGazzangPlan.

Additional Provisions

Ourboardofdirectorshastheauthoritytoamend,suspendorterminatetheGazzangPlan,providedthatnoamendmentmaymateriallyoradverselyaffectawardsalreadygrantedwithoutthewrittenconsentoftheholderoftheaffectedaward.

Capitalization Adjustments

Intheeventofcertaineventsthatresultinanychangetoourcommonstock,includingastockdividend,stocksplit,recapitalizationorothersimilarevent,withoutthereceiptofapplicableconsiderationandotherthananormalcashdividend,ourboardofdirectorsshallmakeproportionaladjustmentstothemaximumnumberandkindofsecuritiesthataresubjecttoanyoutstandingawardsundertheGazzangPlan.

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Corporate Transaction

Ifweexperienceacorporatetransaction(asdefinedintheGazzangPlan),unlessotherwiseprovidedintheagreementbetweenusandtheoptionholderevidencingthetermsandconditionsoftheoptiongrant,outstandingoptionsundertheGazzangPlanmaybeassumedorsubstitutedbythesuccessorcompany.Thevestingofoutstandingawardsthatarenotassumedorsubstitutedandthatareheldbycurrentemployeesattheeffectivetimeofthecorporatetransactionwillbeacceleratedinfullandthenwillterminateupontheclosingofthetransactiontotheextentnotexercised.Thevestingofoutstandingawardsthatarenotassumedorsubstitutedandthatarenotheldbycurrentemployeesattheeffectivetimeofthechangeincontroltransactionwillnotbeacceleratedandwillterminateupontheclosingofthetransactiontotheextentnotexercised.Alternatively,upontheclosingofacorporatetransaction,ourboardofdirectorsmayinsteadelecttoterminateanyoutstandingoptioninexchangeforacashpaymentequaltotheexcess,ifany,of(A)thevalueofthepropertytheoptionholderwouldhavereceivedupontheexerciseoftheoptionover(B)theexerciseprice,ifany,payablebysuchoptionholdertoexercisetheoption.

2017 Equity Incentive Plan

Ourboardofdirectorsadoptedour2017EquityIncentivePlan,or2017Plan,inMarch2017,whichourstockholdersapprovedinMarch2017.Our2017EquityIncentivePlanbecameeffectiveonApril27,2017,theeffectivedateofourinitialpublicoffering,andservesasthesuccessortoour2008Plan.

Share Reserve

AsofJuly31,2017,therewerereserved30,000,000sharesofourcommonstockunderour2017Planplusanyreservedsharesnotissuedorsubjecttooutstandinggrantsunderthe2008Planasoftheeffectivedateofthe2017Plan.Additionally,the3,080,027shareswithheldtosatisfywithholdingtaxobligationsinconnectionwiththesettlementofRSUsconcurrentlywiththisofferingwillbeavailableforissuanceunderour2017Plan.Thenumberofsharesofcommonstockreservedforissuanceunderour2017PlanwillincreaseautomaticallyonthefirstdayofFebruaryofeachcalendaryearduringthetermoftheplanbyanumberofsharesofcommonstockequaltothelesserof(i)5%ofthetotaloutstandingsharesourcommonstockasoftheimmediatelyprecedingJanuary31stor(ii)anumberofsharesdeterminedbyourboardofdirectors.Inaddition,thefollowingsharesofourcommonstockwillbeavailableforgrantandissuanceunderour2017Plan:(i)sharessubjecttoawardsgrantedunderour2017Planthatceasetobesubjecttotheawardsforanyreasonotherthanexerciseofstockoptionsorstockappreciationrights;(ii)sharesissuedorsubjecttoawardsgrantedunderour2017Planthataresubsequentlyforfeitedorrepurchasedbyusattheoriginalissueprice;(iii)sharessubjecttoawardsgrantedunderour2017Planthatotherwiseterminatewithoutsharesbeingissued;(iv)sharessurrendered,canceled,orexchangedforcashoradifferentaward(orcombinationthereof);(v)sharessubjecttoawardsunderthe2017Planthatareusedtopaytheexercisepriceofanawardorwithheldtosatisfythetaxwithholdingobligationsrelatedtoanyaward;(vi)sharesthataresubjecttooutstandingawardsunderthe2008Planwhichceasetobesubjecttosuchawardsbyforfeitureorotherwise,(vii)sharesissuedunderthe2008Planwhichareforfeitedorrepurchasedattheiroriginalissueprice,and(viii)sharessubjecttoawardsunderthe2008Planthatareusedtopaytheexercisepriceofanoptionorwithheldtosatisfythetaxwithholdingobligationsrelatedtoanyaward.

Term

The2017Planterminatestenyearsfromthedateofitsapprovalbyourboardofdirectors,unlessearlierterminatedbyourboardofdirectors.

Eligibility

The2017Planprovidesfortheawardofstockoptions,restrictedstockawards,stockbonusawards,stockappreciationrights,RSUsandperformanceawards.Nopersonwillbeeligibletoreceivemorethan10,000,000sharesinanycalendaryearunderour2017Planotherthananewemployeeofours,whowillbeeligibletoreceivenomorethan20,000,000sharesunderour2017Planinthecalendaryearinwhichtheemployeecommencesemployment.Allawardsotherthanincentivestockoptionsmaybegrantedtoouremployees,directors,consultants,independentcontractorsandadvisors,providedtheconsultants,independentcontractorsandadvisorsrenderservices

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notinconnectionwiththeofferandsaleofsecuritiesinacapital‑raisingtransaction.Incentivestockoptionsmaybegrantedonlytoouremployees.

Administration

The2017Planisadministeredbythecompensationcommitteeofourboardofdirectors,allofthemembersofwhicharenon‑employeedirectorsunderapplicablefederalsecuritieslawsandoutsidedirectorsasdefinedunderapplicablefederaltaxlaws,orbyourboardofdirectorsactinginplaceofourcompensationcommittee.Ourcompensationcommitteehastheauthoritytoconstrueandinterpretour2017Plan,grantawardsandmakeallotherdeterminationsnecessaryoradvisableforitsadministration.Awardsunderthe2017Planmaybemadesubjectto“performancefactors”andothertermsinordertoqualifyasperformance‑basedcompensationforthepurposesofSection162(m)oftheCode.

The2017Planprovidesforthegrantingofstockoptions(bothincentivestockoptionsandnonstatutorystockoptions),restrictedstock,stockappreciationrights,RSUs,performanceawardsandstockbonuses.Abriefdescriptionofeachtypeofawardissetforthbelow.

Stock Options

Astockoptionistheright,butnottheobligation,topurchaseashareofourcommonstockatacertainpriceanduponcertainconditions.Theexercisepriceofeachstockoptionmustbeatleastequaltothefairmarketvalueofourcommonstockonthedateofgrant.Theexercisepriceofincentivestockoptionsgrantedto10%stockholdersmustbeatleastequalto110%ofthefairmarketvalueonthedateofgrant(andhaveatermthatdoesnotexceedfiveyears).Ourcompensationcommitteemayprovideforoptionstobeexercisedonlyastheyvestortobeimmediatelyexercisablewithanysharesissuedonexercisebeingsubjecttoourrightofrepurchasethatlapsesasthesharesvest.Themaximumtermofoptionsgrantedunderour2017Planistenyears.

Restricted Stock

Arestrictedstockawardisanofferbyustosellsharesofourcommonstocksubjecttorestrictions.Theprice(ifany)ofarestrictedstockawardwillbedeterminedbyourcompensationcommittee.Unlessotherwisedeterminedbyourcompensationcommitteeatthetimeofaward,vestingwillceaseonthedatetheparticipantnolongerprovidesservicestousandunvestedshareswillbeforfeitedtoorrepurchasedbyus.

Stock Appreciation Rights

Stockappreciationrightsprovideforapayment,orpayments,incashorsharesofourcommonstock,totheholderbaseduponthedifferencebetweenthefairmarketvalueofourcommonstockonthedateofexerciseandthestatedexerciseprice.Stockappreciationrightsmayvestbasedontimeorachievementofperformanceconditions.

Restricted Stock Units (RSUs)

AnRSUisanawardthatcoversanumberofsharesofourcommonstockthatmaybesettleduponvestingincash,bytheissuanceoftheunderlyingsharesoracombinationofboth.Theseawardsaresubjecttoforfeiturepriortosettlementbecauseofterminationofemploymentorfailuretoachieveperformanceconditions.

Performance Awards

Performanceawardscoveranumberofsharesofourcommonstockthatmaybesettleduponachievementofpre‑establishedperformanceconditionsincashorbyissuanceoftheunderlyingsharesorotherproperty(oranycombinationthereof).Theseawardsaresubjecttoforfeiturepriortosettlementbecauseofterminationofemploymentorfailuretoachieveperformanceconditions.

Stock Bonus Awards

Stockbonusawardsmaybegrantedasadditionalcompensationforservicesorperformance,andtherefore,maynotbeissuedinexchangeforcash.

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Additional Provisions

Awardsgrantedunderour2017Planmaynotbetransferredinanymannerotherthanbywillorbythelawsofdescentanddistribution,orasdeterminedbyourcompensationcommittee.Unlessotherwiserestrictedbyourcompensationcommittee,awardsthatarenonstatutorystockoptionsmaybeexercisedduringthelifetimeoftheoptioneeonlybytheoptionee,theoptionee’sguardianorlegalrepresentative,afamilymemberoftheoptioneewhohasacquiredtheoptionbyapermittedtransfer,oraftertheoptionee’sdeath,bythelegalrepresentativeoftheoptionee’sheirsorlegatees.Awardsthatareincentivestockoptionsmaybeexercisedduringthelifetimeoftheoptioneeonlybytheoptionee,theoptionee’sguardianorlegalrepresentative,or,aftertheoptionee’sdeath,bythelegalrepresentativeoftheoptionee’sheirsorlegatees.Stockoptionsgrantedunderour2017Plangenerallymaybeexercisedforaperiodofthreemonthsaftertheterminationoftheoptionee’sservicetous,exceptinthecaseofdeathorpermanentdisability,inwhichcasetheoptionsgenerallymaybeexercisedforuptotwelvemonthsfollowingterminationoftheoptionee’sservicetous.Awardsgrantedunderour2017Planmaybesubjecttoclawbackorrecoupmentpursuanttoanyapplicablecompensationclawbackorrecoupmentpolicyadoptedbyourboardofdirectorsorasrequiredbyapplicablelaw.

Change of Control

Ifweexperienceachangeofcontroltransaction,outstandingawards,includinganyvestingprovisions,maybeassumedorsubstitutedbythesuccessorcompany.Thevestingofoutstandingawardsthatarenotassumedorsubstitutedwillbeacceleratedunlessotherwisedeterminedbyourboardofdirectorsandthenwillexpireupontheclosingofachangeincontroltransaction.

AsofJuly31,2017,thereremainedoutstandingunderour2017Plan,(i)optionstopurchase30,300sharesofourcommonstockand(ii)RSUsthatmaybesettledfor1,356,850sharesofourcommonstock.TheoptionsoutstandingasofJuly31,2017hadaweighted-averageexercisepriceof$21.50pershare.

2017 Employee Stock Purchase Plan

Weadoptedour2017EmployeeStockPurchasePlan,or2017ESPP,inMarch2017,anditwasapprovedbyourstockholdersinMarch2017,inordertoenableeligibleemployeestopurchasesharesofourcommonstockatadiscountfollowingthedateofourinitialpublic.Purchaseswillbeaccomplishedthroughparticipationindiscreteofferingperiods.Our2017ESPPisintendedtoqualifyasanemployeestockpurchaseplanunderSection423oftheCode.

Share Reserve

Weinitiallyreserved3,000,000sharesofourcommonstockforissuanceunderour2017ESPP.Thenumberofsharesreservedforissuanceunderour2017ESPPwillincreaseautomaticallyonFebruary1stofeachofthefirst10calendaryearsfollowingthefirstofferingdatebythenumberofsharesequaltothelesserofeither1%ofthetotaloutstandingsharesofourcommonstockasoftheimmediatelyprecedingJanuary31st(roundedtothenearestwholeshare)oranumberofsharesofourcommonstockdeterminedbyourboardofdirectorsorcompensationcommittee.Theaggregatenumberofsharesissuedoverthetermofour2017ESPPwillnotexceed30,000,000sharesofourcommonstock.

Offering Periods

Thefirstofferingperiodandpurchaseperiodunderour2017ESPPbeganonApril27,2017andwillendonDecember20,2017(orsuchotherdatedeterminedbyourboardofdirectorsorourcompensationcommittee).Eachsubsequentofferingperiodwillbeforsixmonths(commencingeachJune21andDecember21)andwillconsistofonesix‑monthpurchaseperiod,unlessotherwisedeterminedbyourboardofdirectorsorourcompensationcommittee.

Eligibility and Participation

Ouremployeesgenerallyareeligibletoparticipateinour2017ESPPiftheyareemployedbyusforatleast20hoursperweekandmorethanfivemonthsinacalendaryear.Employeeswhoare5%stockholders,orwould

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become5%stockholdersasaresultoftheirparticipationinour2017ESPP,areineligibletoparticipateinour2017ESPP.Wemayimposeadditionalrestrictionsoneligibility(withinthelimitspermittedbyapplicablelaw).Onceanemployeeisenrolledinour2017ESPP,participationwillbeautomaticinsubsequentofferingperiods.Anemployee’sparticipationautomaticallyendsuponterminationofemploymentforanyreason.

Payment for Shares and Purchase Price

Underour2017ESPP,eligibleemployeesareabletoacquiresharesofourcommonstockbyaccumulatingfundsthroughpayrolldeductions.Oureligibleemployeesareabletoselectarateofpayrolldeductionbetween1%and15%oftheirbasecashcompensation.Thepurchasepriceforsharesofourcommonstockpurchasedunderour2017ESPPis85%ofthelesserofthefairmarketvalueofourcommonstockon(i)thefirsttradingdayoftheapplicableofferingperiodand(ii)thelasttradingdayofeachpurchaseperiodintheapplicableofferingperiod.

Administration and Term

Ourcompensationcommitteeadministersour2017ESPP.Thecompensationcommitteeorourboardofdirectorsalsohastherighttoamendorterminateour2017ESPPatanytime.Our2017ESPPterminatesonthetenthanniversaryofthelastdayofthefirstpurchaseperiod,unlessitisterminatedearlierbyourboardofdirectorsorallsharesofcommonstockreservedforissuanceunderour2017ESPPhavebeenissued.

Share Limitations

Noparticipanthastherighttopurchasesharesofourcommonstockinanamount,whenaggregatedwithpurchaserightsunderallouremployeestockpurchaseplansthatarealsoineffectinthesamecalendaryear(s),thathasafairmarketvalueofmorethan$25,000,determinedasofthefirstdayoftheapplicablepurchaseperiod,foreachcalendaryearinwhichthatrightisoutstanding.Inaddition,noparticipantispermittedtopurchasemorethan2,500sharesduringanyonepurchaseperiodorsuchlesseramountdeterminedbyourcompensationcommitteeorourboardofdirectors.

Change in Control

Ifweexperienceachangeincontroltransaction,eachoutstandingrighttopurchasesharesunderour2017ESPPmaybeassumedoranequivalentoptionsubstitutedbythesuccessorcorporation.Intheeventthatthesuccessorcorporationrefusestoassumeorsubstitutetheoutstandingpurchaserights,anyofferingperiodthatcommencedpriortotheclosingoftheproposedchangeincontroltransactionwillbeshortenedandterminatedonanewpurchasedate.Thenewpurchasedatewilloccuronorpriortotheclosingoftheproposedchangeincontroltransactionandour2017ESPPwillthenterminateontheclosingoftheproposedchangeincontrol.

401(k) Plan

Wemaintainaretirementplanforthebenefitofouremployees.Theplanisintendedtoqualifyasatax‑qualified401(k)plansothatcontributionstothe401(k)plan,andincomeearnedonsuchcontributions,arenottaxabletoparticipantsuntilwithdrawnordistributedfromthe401(k)plan(exceptinthecaseofcontributionsunderthe401(k)plandesignatedasRothcontributions).The401(k)planprovidesthateachparticipantmaycontributeupto100%ofhisorherpre‑taxcompensation,uptoanannualstatutorylimit.Participantswhoareatleast50yearsoldcanalsocontributeadditionalamountsbasedonstatutorylimitsfor“catch‑up”contributions.Underthe401(k)plan,eachemployeeisfullyvestedinhisorherdeferredsalarycontributions.Employeecontributionsareheldandinvestedbytheplan’strusteeasdirectedbyparticipants.Our401(k)planprovidesfordiscretionarymatchingofemployeecontributions.

Limitation of Liability and Indemnification of Directors and Officers

OurrestatedcertificateofincorporationcontainsprovisionsthatlimittheliabilityofourdirectorsformonetarydamagestothefullestextentpermittedbyDelawarelaw.Consequently,ourdirectorswillnotbepersonallyliabletousorourstockholdersformonetarydamagesforanybreachoffiduciarydutiesasdirectors,exceptliabilityforthefollowing:

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• foranybreachoftheirdutyofloyaltytousorourstockholders;

• foranyactoromissionnotingoodfaithorthatinvolvesintentionalmisconductoraknowingviolationoflaw;

• unlawfulpaymentsofdividendsorunlawfulstockrepurchasesorredemptionsasprovidedinSection174oftheDelawareGeneralCorporationLaw;or

• foranytransactionfromwhichtheyderivedanimproperpersonalbenefit.

Ourrestatedbylawsprovidethatweshallindemnify,tothefullestextentpermittedbylaw,anypersonwhoisorwasapartyoristhreatenedtobemadeapartytoanyaction,suitorproceeding,byreasonofthefactthatheorsheisorwasoneofourdirectorsorofficersorisorwasservingatourrequestasadirectororofficerofanothercorporation,partnership,jointventure,trustorotherenterprise.Ourrestatedbylawsprovidethatwemayindemnifyouremployeesoragents.Ourrestatedbylawsalsoprovidethatwemustadvanceexpensesincurredbyoronbehalfofadirectororofficerinadvanceofthefinaldispositionofanyactionorproceeding,subjecttolimitedexceptions.

Wehaveinsurancepoliciesunderwhich,subjecttothelimitationsofthepolicies,coverageisprovidedtoourdirectorsandofficersagainstlossarisingfromclaimsmadebyreasonofbreachoffiduciarydutyorotherwrongfulactsasadirectororofficer,includingclaimsrelatingtopublicsecuritiesmatters,andtouswithrespecttopaymentsthatmaybemadebyustotheseofficersanddirectorspursuanttoourindemnificationobligationsorotherwiseasamatteroflaw.

WehaveenteredintoindemnificationagreementswitheachofourdirectorsandexecutiveofficersthatmaybebroaderthanthespecificindemnificationprovisionscontainedintheDelawareGeneralCorporationLaw.Theseindemnificationagreementsrequireus,amongotherthings,toindemnifyourdirectorsandexecutiveofficersagainstliabilitiesthatmayarisebyreasonoftheirstatusorservice.Theseindemnificationagreementsalsorequireustoadvanceallexpensesincurredbythedirectorsandexecutiveofficersininvestigatingordefendinganysuchaction,suitorproceeding.Webelievethattheseagreementsarenecessarytoattractandretainqualifiedindividualstoserveasdirectorsandexecutiveofficers.

Atpresent,wearenotawareofanypendinglitigationorproceedinginvolvinganypersonwhoisorwasoneofourdirectors,officers,employeesorotheragentsorisorwasservingatourrequestasadirector,officer,employeeoragentofanothercorporation,partnership,jointventure,trustorotherenterprise,forwhichindemnificationissought,andwearenotawareofanythreatenedlitigationthatmayresultinclaimsforindemnification.

Theunderwritingagreementprovidesforindemnificationbytheunderwritersofusandourofficers,directorsandemployeesforcertainliabilitiesarisingundertheSecuritiesActof1933,asamended,ortheSecuritiesAct,orotherwise.

InsofarasindemnificationforliabilitiesarisingundertheSecuritiesActmaybepermittedtodirectors,officersorpersonscontrollingourcompanypursuanttotheforegoingprovisions,wehavebeeninformedthat,intheopinionoftheSecuritiesandExchangeCommission,suchindemnificationisagainstpublicpolicyasexpressedintheSecuritiesActandisthereforeunenforceable.

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CERTAIN RELATIONSHIPS AND RELATED‑‑PARTY TRANSACTIONS

Inadditiontothecompensationarrangements,includingemployment,terminationofemploymentandchangeofcontrolarrangementsandindemnificationarrangementsdescribedin“ExecutiveCompensation”andtheregistrationrightsdescribedin“DescriptionofCapitalStock—RegistrationRights,”thefollowingisadescriptionofeachtransactionsinceFebruary1,2014andeachcurrentlyproposedtransactioninwhich:

• wehavebeenoraretobeaparticipant;

• theamountinvolvedexceeds$120,000;and

• anyofourdirectors,executiveofficersorholdersofmorethan5%ofourcapitalstock,oranyimmediatefamilymemberoforpersonsharingthehouseholdwithanyoftheseindividuals,hadorwillhaveadirectorindirectmaterialinterest.

Series F‑‑1 Preferred Stock Financing

InMay2014,wesoldanaggregateof11,994,668sharesofourSeriesF‑1preferredstockatapurchasepriceof$30.92persharetoIntelCorporation,orIntel,foranaggregatepurchasepriceofapproximately$370.9million.Ms.Stevenson,oneofourformerdirectors,isaformerCorporateVicePresidentofIntel.Aftercompletionofthisoffering,entitiesaffiliatedwithIntelwillholdapproximately18.7%ofouroutstandingcapitalstockbasedonthenumberofsharesoutstandingasofAugust31,2017.ThepurchasepriceoftheSeriesF‑1preferredstockwasdeterminedbasedonanumberoffactors,includingthestatusofourbusinessandresultsofoperations,ourexpectationsforthefuture,discussionsbetweenthirdpartiesandmanagementwithrespecttopricesatwhichsuchthirdpartieswouldbewillingtopurchaseourSeriesF‑1preferredstockandnegotiationsbetweenourmanagement,boardofdirectorsandIntel.PriortothesaleofourSeriesF‑1preferredstock,Inteldidnotholdanyequityinterestinus,nordidanyofitsaffiliatesserveasamemberofourboardofdirectors.EachshareofourSeriesF‑1preferredstockconvertedautomaticallyintooneshareofourcommonstockuponthecompletionofourinitialpublicoffering.

InconnectionwiththeSeriesF‑1financing,weenteredintoaconfidentialityagreementwithIntel,underwhichIntelhasagreedtokeepconfidentialtheinformationprovidedtoIntelasaresultofIntel’snotice,informationandinspectionrightsasastockholderofourcompany,aswellastheinformationprovidedtoIntel’srepresentativeonourboardofdirectorsasaresultofhisorherpositionasamemberoftheboardofdirectors.Moreover,withspecifiedexceptions,IntelwillnotseektoobtainconfidentialinformationfromIntel’srepresentativeonourboardofdirectorsthattherepresentativehasreceivedinhisorhercapacityasamemberoftheboardofdirectors.

2014 Tender Offer

InApril2014,inconnectionwiththeSeriesF‑1financing,weagreedtowaivecertaintransferrestrictionsinconnectionwith,andassistintheadministrationof,atenderofferthatIntelproposedtocommence.InMay2014,Intelcommencedatenderoffertopurchasesharesofourcapitalstockfromspecifiedsecurityholders,includingAccel,GreylockPartnersandtheirrespectiveaffiliates.Abroadclassofsecurityholders,whichincludedemployees,wereeligibletoparticipateinthetenderoffer.Amongothersellers,Mr.Olson,oneofourdirectorsandexecutiveofficers,andMr.Frankola,oneofourexecutiveofficers,alsosoldsharesofcapitalstockinthetenderoffer.Anaggregateof11,994,666sharesofourcapitalstockweretenderedto,andpurchasedby,Intelpursuanttothetenderofferatapriceofapproximately$30.92pershare,aggregatingapproximately$370.9millionforatotalinvestmentbyIntelof$741.8million,includingitsinvestmentintheSeriesF‑1financing.

Investor Rights Agreement

Weenteredintoaninvestorrightsagreement,asamended,withcertainholdersofourconvertiblepreferredstock,includingentitieswithwhichcertainofourdirectorsareaffiliated,whichbecameeffectiveuponcompletionofourinitialpublicoffering.Mr.Li,oneofourdirectors,isapartneratAccel;entitiesaffiliatedwithAccelholdsharesofourcommonstock,and,priortothecompletionourourinitialpublicoffering,heldsharesofourSeriesAconvertiblepreferredstock,SeriesBconvertiblepreferredstock,SeriesCconvertiblepreferredstock,SeriesDconvertiblepreferredstockandSeriesEconvertiblepreferredstock.Mr.Bhusri,oneofourformerdirectors,isan

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advisorypartneratGreylockPartnersandamemberoftheboardofdirectorsofIntel;entitiesaffiliatedwithGreylockholdsharesofourcommonstock,and,priortothecompletionofourinitialpublicoffering,heldsharesofourSeriesBconvertiblepreferredstock,SeriesCconvertiblepreferredstock,SeriesDconvertiblepreferredstockandSeriesEconvertiblepreferredstock.Ms.Stevenson,oneofourformerdirectors,wasaCorporateVicePresidentatIntel,andentitiesaffiliatedwithIntelholdsharesofourcommonstock,and,priortothecompletionofourinitialpublicoffering,heldsharesofourSeriesAconvertiblepreferredstock,SeriesBconvertiblepreferredstock,SeriesCconvertiblepreferredstock,SeriesDconvertiblepreferredstock,SeriesEconvertiblepreferredstockandSeriesF‑1convertiblepreferredstock.Formoreinformationontheseentities,see“PrincipalandSellingStockholders.”ThesestockholdersareentitledtorightswithrespecttotheregistrationoftheirsharesundertheSecuritiesAct.Foradescriptionoftheseregistrationrights,see“DescriptionofCapitalStock—RegistrationRights.”Underthisagreement,IntelalsohasaspecialFormS‑3registrationright.AtanytimeafterweareeligibletofilearegistrationstatementonFormS‑3,IntelcanrequestthatweregisteralloraportionoftheirsharesonFormS‑3.Thisrightislimitedtooneregistrationstatementfilinginanytwelvemonthperiod.WemaypostponethefilingofaregistrationstatementforIntel’sregistrablesecuritiesonFormS‑3onetimeinatwelvemonthperiodforupto90daysifourboardofdirectorsdeterminesthatsuchafilingwouldbemateriallydetrimentaltousandourstockholders.TheseregistrationrightswillterminateupontheearliertooccuroftheclosingofadeemedliquidationeventorwhenthesharesheldbyandissuabletoIntelanditsaffiliatesmaybesoldwithoutregistrationincompliancewithRule144oftheSecuritiesAct.IntelanditsaffiliateshaveenteredintoagreementswiththeunderwritersnottomakeanydemandfororexercisetheirregistrationrightsuntilthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017.Foradescriptionoftheseagreements,see“Underwriters.”

Voting and Standstill Agreement

WeenteredintoavotingandstandstillagreementwithIntel,whichbecameeffectiveuponthecompletionofourinitialpublicoffering.Pursuanttothetermsofthisagreement,wehaveagreedthatourboardofdirectorswillnominateforelectionadirectordesignatedbyIntelateachannualmeetingofthestockholdersatwhichthetermofsuchdesigneeends.Thisrightterminatesuponspecifiedcircumstances,includingIntelanditsaffiliatesceasingtoholdatleast10%ofourfully‑dilutedshares,subjecttospecifieddeferralsandexceptions;Intelmateriallybreachingthecollaborationandoptimizationagreementdiscussedbelow;theconsummationofanacquisitionofourcompany;andtheconsummationofadirectoranindirectinvestmentbyInteloritsaffiliatesofequitysecuritiesissuedbyspecifiedcompetitors,ortheacquisitionofsuchacompetitor’sbusinessorassets(subjecttospecifiedexceptions).

ThisagreementalsoprovidesrestrictionsonIntel’sabilitytoacquireoursecuritiesandassets.Theserestrictionsinclude,butarenotlimitedto,Intel’sabilitytoacquiremorethan20%ofourfullydilutedcapitalstock,whichwerefertoastheIntelMaximumPercentage,andIntel’sabilitytoacquireanyassets,indebtednessorbusinessesofourcompany;proposeoreffectanytenderorexchangeoffersinvolvingourcompany;anyrecapitalization,restructuring,reorganization,liquidationordissolutioninvolvingourcompany;anysolicitationofproxiesorconsentstovotewithrespecttothevotingofthesecuritiesofourcompany;orotherwiseact,aloneorinconcertwithothers,toseekrepresentationonortocontrolorinfluenceourmanagement,boardofdirectorsorpolicies.However,theserestrictionsdonot:

• limittheInteldesignateddirectorinfulfillinghisorherfiduciarydutiesasadirectorinhisorhergoodfaithjudgment,

• precludeIntelfromengaginginprivatediscussionswithus,includingwithrespecttoapotentialmutuallyagreedacquisitionofClouderameetingspecifiedcriteria,or

• precludeIntelfrommakinganoffertousthatprovidesforthefullacquisitionofCloudera,whetherbymerger,tenderofferorotherwise,andengaginginatenderofferforafullacquisitionofClouderameetingspecifiedcriteria.

Intheeventthatanotherinvestor(includingitsaffiliates),otherthanapurelyfinancialinvestor,acquiresagreaterpercentageofourfully‑dilutedsharesthantheIntelMaximumPercentage,orOtherStrategicHolder,Intel’sMaximumPercentageshallincreasetothepercentageheldbysuchOtherStrategicHolder.Apurelyfinancialinvestorisaninvestorthathasacquiredoursecuritiesintheordinarycourseofbusinessandnotwiththepurpose

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norwiththeeffectofchangingorinfluencingthecontrolofourcompanyordoesnothaveanystrategicorcommercialrelationshipwithus.Inaddition,ifsuchOtherStrategicHolderisnotsubjecttostandstillterms,orissubjecttostandstilltermsmorefavorabletosuchOtherStrategicHolderthanthetermsapplicabletoIntel,theserestrictionswillbesuspendedand,ifapplicable,replacedbysuchmorefavorableterms(ornorestriction,iftheOtherStrategicHolderisnotsubjecttostandstillterms).

Further,theserestrictionswillbesuspendedifa“person”(asdefinedbySection13(d)(3)oftheExchangeAct)or“group”(asdefinedbySection13(d)(3)oftheExchangeAct):

• entersintoanagreementwithusprovidingfortheacquisitionofClouderaorthepurchaseorotheracquisitionofallorsubstantiallyallofourassets,

• entersintoanagreementwithusprovidingforthepurchaseorotheracquisitionof,includingbywayoftenderoffer,orpurchasesorotherwiseacquires,beneficialownershipofsecuritiesrepresentingamajorityofthevotingpowerofourcapitalstock,or

• fileswiththeSECaScheduleTOcoveringatenderofferprovidingforthepurchaseorotheracquisitionofbeneficialownershipofsecuritiesrepresentingamajorityofthevotingpowerofourcapitalstock;

untilsuchagreementortenderofferhaslapsed,isabandoned,terminatedorisotherwisenolongerpending.Additionally,pursuanttothisagreement,Intelhasagreedtorestrictionsonitsvotingpower.Intelalsoexecutedanirrevocablevotingproxytouswhichwaseffectiveuponthecompletionofourinitialpublicoffering.See“DescriptionofCapitalStock—CommonStock—VotingRights”foradescriptionoftheserestrictions.

Intel Enterprise Subscription Agreement

WeenteredintoanEnterpriseSubscriptionAgreement(ESA)withIntel pursuant towhichIntel becameourcustomer. UndertheESA,Intel mayuseourplatforminsupportofitsbigdatainitiativesandotherinternalneeds.TheESAtermiseffectivefromApril2014andexpiresinMay2018.Wehavereceivedapproximately$2.2million,$5.3million,$8.3millionand$5.3millionfortheyearsendedJanuary31,2015,2016and2017,andthesixmonthsendedJuly31,2017,respectively,inpaymentsfromIntelforsubscriptionsandservicesundertheESA.Weanticipatereceiving$9.0millioninfuturepaymentsfromIntelunderthetermsoftheESA.

Intel Collaboration and Optimization Agreement

InconjunctionwiththeSeriesF‑1preferredstockfinancing,weenteredintoacollaborationandoptimizationagreementwithIntel,whichwasamendedandrestatedasofMarch21,2017.ThisagreementgovernsourcollaborationwithIntelonthedevelopment,marketinganddistributionofspecifiedopensourcedatamanagementsoftware,includingtheoptimizationofsuchsoftwareforusewithIntel’sprocessorsandarchitecture.Eitherpartymayterminatetheagreementundercertaincircumstances,includingifthepartiesfailtomeetcertaincollaborationgoals.Moreover,IntelmayterminatetheagreementwithorwithoutcauseupontwelvemonthswrittennoticeatanytimeafterMarch21,2018.TheagreementautomaticallyrenewsfollowingtheexpirationoftheinitialtermonMarch21,2018foranadditionaltwelvemonthterm,andthereafterwillbeautomaticallyextendedforadditionaltwelvemonthperiods,unlesseitherpartyprovideswrittennoticeofnon‑renewalatleast180daysbeforetheexpirationoftherenewalterm.

Marketing and Miscellaneous Cooperation with Intel

Wehavereceivedapproximately$0.8millionfromInteloverthepast24monthsformiscellaneousmarketing,servicesandotheritemsrelatedtotheoperationofthestrategicpartnership.

Deutsche Bank AG

Wehavereceivedapproximately$0.7million,$3.1million,$4.8millionand$4.5millionfortheyearsendedJanuary31,2015,2016and2017,andthesixmonthsendedJuly31,2017,respectively,inpaymentsfromDeutscheBankAGforsubscriptionsandservicesintheordinarycourseofbusiness.OurboardofdirectorsincludesKimberlyL.Hammonds,MemberoftheManagementBoardandGroupChiefOperatingOfficerofDeutscheBankAG.

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Executive Compensation and Employment Arrangements

Pleasesee“ExecutiveCompensation”forinformationoncompensationarrangementswithourexecutiveofficers,includingrestrictedstockunitandoptiongrantsandagreementswithexecutiveofficers.Pleasesee“ExecutiveCompensation—TerminationorChangeinControlArrangements”forinformationonterminationarrangementswithexecutiveofficers.

Indemnification of Directors and Officers

See“ExecutiveCompensation—LimitationofLiabilityandIndemnificationofDirectorsandOfficers”forinformationonourindemnificationarrangementswithourdirectorsandexecutiveofficers.

Restricted Stock Unit (RSU) and Stock Option Grants

See“ExecutiveCompensation”forinformationoncertainRSUgrantsandstockoptiongrantstoourexecutiveofficersandrelatedgrantpolicies.

Participation in Our Initial Public Offering

CertainentitiesaffiliatedwithIntel,aholderofmorethan5%ofourcommonstock,purchased1,200,000sharesofourcommonstockinourinitialpublicofferingattheinitialpublicofferingpriceof$15.00pershare.

Review, Approval or Ratification of Transactions with Related Parties

Ourwrittenrelatedpersontransactionspolicyprovidesthatourexecutiveofficers,directors,nomineesforelectionasadirector,beneficialownersofmorethan5%ofourcommonstockandanymembersoftheimmediatefamilyofandanyentityaffiliatedwithanyoftheforegoingpersonsarenotpermittedtoenterintoamaterialrelatedpersontransactionwithuswithoutthereviewandapprovalofourauditcommitteeoracommitteecomposedsolelyofindependentdirectorsintheeventitisinappropriateforourauditcommitteetoreviewsuchtransactionduetoaconflictofinterest.Thepolicyprovidesthatanyrequestforustoenterintoatransactionwithanexecutiveofficer,director,nomineeforelectionasadirector,beneficialownerofmorethan5%ofourcommonstockorwithanyoftheirimmediatefamilymembersoraffiliates,inwhichtheamountinvolvedexceeds$120,000willbepresentedtoourauditcommitteeforreview,considerationandapproval.Inapprovingorrejectinganysuchproposal,weexpectthatourauditcommitteewillconsidertherelevantfactsandcircumstancesavailableanddeemedrelevanttotheauditcommittee,including,butnotlimitedto,whetherthetransactionisontermsnolessfavorablethantermsgenerallyavailabletoanunaffiliatedthirdpartyunderthesameorsimilarcircumstancesandtheextentoftherelatedperson’sinterestinthetransaction.

Priortotheadoptionofourrelatedpersontransactionspolicy,wehadnoformal,writtenpolicyforthereviewandapprovaloftransactionswithrelatedpersons.However,ourboardofdirectorshashistoricallyreviewedandapprovedanytransactionwhereadirectororofficerhadafinancialinterest,includingallofthetransactionsdescribedabove.Priortoapprovingsuchatransaction,thematerialfactsastoadirector’sorofficer’srelationshiporinterestastotheagreementortransactionweredisclosedtoourboardofdirectors.Ourboardofdirectorswouldtakethisinformationintoaccountwhenevaluatingthetransactionandindeterminingwhethersuchtransactionwasfairtoourcompanyandinthebestinterestofallofourstockholders.

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PRINCIPAL AND SELLING STOCKHOLDERS

ThefollowingtablepresentsinformationastothebeneficialownershipofourcommonstockasofAugust31,2017,andasadjustedtoreflectthesaleofcommonstockbyusandthesellingstockholdersinthisoffering,by:

• eachstockholderknownbyustobethebeneficialownerofmorethan5%ofourcommonstock;

• eachofourdirectors;

• eachofournamedexecutiveofficers;

• allofourdirectorsandexecutiveofficersasagroup;and

• eachsellingstockholder.

BeneficialownershipisdeterminedinaccordancewiththerulesoftheSecuritiesandExchangeCommissionandthusrepresentsvotingorinvestmentpowerwithrespecttooursecurities.Unlessotherwiseindicatedbelow,toourknowledge,thepersonsandentitiesnamedinthetablehavesolevotingandsoleinvestmentpowerwithrespecttoallsharesbeneficiallyowned,subjecttocommunitypropertylawswhereapplicable.Sharesofourcommonstocksubjecttooptionsthatarecurrentlyexercisableorexercisablewithin60daysofAugust31,2017aswellassharesofourcommonstockissuableuponthesettlementofrestrictedstockunits(RSUs)occurringwithin60daysofAugust31,2017aredeemedtobeoutstandingandtobebeneficiallyownedbythepersonholdingtheoptionsorRSUsforthepurposeofcomputingthepercentageownershipofthatpersonbutarenottreatedasoutstandingforthepurposeofcomputingthepercentageownershipofanyotherperson.

Percentageownershipofourcommonstockbeforethisofferingisbasedon131,481,143sharesofourcommonstockoutstandingonAugust31,2017andassumestheissuanceof5,038,706sharesofcommonstocksubjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations.Percentageownershipofourcommonstockafterthisoffering(assumingnoexerciseoftheunderwriters’optiontopurchaseadditionalshares)alsoassumestheforegoing,thesaleof3,000,000sharesbyusand10,432,114sharesbythesellingstockholdersinthisoffering,andtheissuanceof5,038,706sharesofcommonstocksubjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttothecancellationandforfeitureof3,080,027shareswithheldtosatisfytheassociatedwithholdingtaxobligations.Unlessotherwiseindicated,theaddressofeachoftheindividualsandentitiesnamedbelowisc/oCloudera,395PageMillRoad,PaloAlto,California94306.

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Name of Beneficial Owner

Number of SharesBeneficially OwnedBefore the Offering

Percent of SharesBeneficially OwnedBefore the Offering

Number of SharesOffered

Number of SharesBeneficially OwnedAfter the Offering

Percent of SharesBeneficially OwnedAfter the Offering

Named Executive Officers and Directors:

ThomasJ.Reilly(1) 7,403,405 5.1% — 7,403,405 5.0%

JimFrankola(2) 1,171,034 * — 1,171,034 *

MichaelA.Olson(3) 5,166,112 3.7% 587,288 4,578,824 3.2%

MartinCole(4) 35,352 * — 35,352 *

KimberlyHammonds(5) — * — — *

PingLi(6) 18,409,144 13.5% 5,297,866 13,111,278 9.4%

StevenJ.Sordello(7) 35,352 * — 35,352 *

MichaelA.Stankey(8) — * — — *Allexecutiveofficersanddirectorsasagroup(8persons)(9) 32,220,399 22.0% 5,885,154 26,335,245 17.7%

5% Stockholders:

IntelCorporation(10) 26,065,827 19.1% — 26,065,827 18.7%

EntitiesaffiliatedwithAccel(6) 18,409,144 13.5% 5,297,866 13,111,278 9.4%

EntitiesaffiliatedwithGreylockPartners(11) 14,199,711 10.4% 2,979,441 11,220,270 8.0%

Other Selling Stockholders:

DouglassCutting(12) 1,601,653 1.2% 31,535 1,570,118 1.1%

Employeeshiredin2008(13) 481,279 * 33,252 448,027 *

Employeeshiredin2009(13) 1,209,346 * 65,931 1,143,415 *

Employeeshiredin2010(13) 1,124,193 * 96,645 1,027,548 *


Employeeshiredin2012(13) 1,090,309 * 131,120 959,189 *EmployeeshiredfromJanuary1,2013toJune30,2013(13) 663,218 * 104,324 558,894 *

EmployeeshiredfromJuly1,2013toDecember31,2013(13) 1,036,836 * 112,765 924,071 *


Employeeshiredin2015(13) 1,071,309 * 553,476 517,833 *

Employeeshiredin2016(13) 241,060 * 169,653 71,407 *___________* Representsbeneficialownershipoflessthan1%ofouroutstandingsharesofcommonstock.(1) Consistsof(a)7,350,740sharessubjecttooptionsthatareexercisablewithin60daysofAugust31,2017and(b)52,665sharessubjecttothesettlementofrestrictedstock

units(RSUs),thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations.

(2) Consistsof(a)552,000shares,(b)562,677sharessubjecttostockoptionsthatareexercisablewithin60daysofAugust31,2017,and(c)56,357sharessubjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations.

(3) Consistsof(a)9,700sharesheldbyMr.Olson,(b)3,350,820sharesheldbytheMichaelandTeresaOlsonRevocableTrustdatedMay24,2001,ofwhichMr.Olsonistrustee,(c)1,764,009sharessubjecttostockoptionsthatareexercisablewithin60daysofAugust31,2017and(d)41,583subjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations.

(4) Consistsof(a)33,477sharesand(b)1,875RSUswhicharesubjecttovestingconditionsexpectedtooccurwithin60daysofAugust31,2017.(5) KimberlyHammondsjoinedourboardofdirectorsinMarch2017.(6) Consistsof(a)3,018,220sharesheldbyAccelGrowthFundIIL.P.,orAGFII,(b)218,537sharesheldbyAccelGrowthFundIIStrategicPartnersL.P.,orAGFII

Strategic,(c)293,736sharesheldbyAccelGrowthFundInvestors2012L.L.C.,orAGFI,(d)1,316,887sharesheldbyAccelInvestors2008L.L.C.,orAI2008,(e)1,382sharesheldbyAccelInvestors2013L.L.C.,orAI2013,(f)12,592,182sharesheldbyAccelXL.P.,orAccelX,(g)954,215sharesheldbyAccelXStrategicPartnersL.P.,orAccelXStrategic,(h)978sharesheldbyAccelXIStrategicPartnersL.P.,orAccelXIStrategicand(i)13,007sharesheldbyAccelXI,L.P.,orAccelXI.AccelGrowthFundIIAssociatesL.L.C.,orAGFIIAssociates,isthegeneralpartnerofAGFIIandAGFIIStrategicandhasthesolevotingandinvestmentpower.AndrewG.Braccia,

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SameerK.Gandhi,PingLi,TracyL.Sedlock,RyanJ.SweeneyandRichardP.WongaretheManagingMembersofAGFIIAssociatesandAGFIandsharevotingandinvestmentpowersoversuchshares.AccelXAssociatesL.L.C.,orAccelXAssociates,isthegeneralpartnerofAccelXandAccelXStrategicandhasthesolevotingandinvestmentpower.AndrewG.Braccia,KevinJ.Efrusy,SameerK.Gandhi,PingLi,TracyL.SedlockandRichardP.WongaretheManagingMembersofAccelXAssociatesandAI2008andsharevotingandinvestmentpowersoversuchshares.AccelXIAssociatesL.L.C.,orAccelXIAssociates,istheGeneralPartnerofAccelXIandAccelXIStrategicandhasthesolevotingandinvestmentpower.AndrewG.Braccia,SameerK.Gandhi,PingLi,TracyL.SedlockandRichardP.WongaretheManagingMembersofAccelXIAssociatesandAI2013andsharevotingandinvestmentpowersoversuchshares.Iftheoptiontopurchaseadditionalsharesisexercisedbytheunderwritersinfull,anadditional1,230,996sharesofcommonstockwillbesoldbyentitiesaffiliatedwithAccel,afterwhichentitiesaffiliatedwithAccelwillbeneficiallyown11,880,282sharesofcommonstock,whichrepresents8.5%ofthetotalvotingpowerafterthisoffering.TheprincipalbusinessaddressforallentitiesandindividualsaffiliatedwithAccelis428UniversityAvenue,PaloAlto,California94301.

(7) Consistsof(a)33,477sharesand(b)1,875RSUswhicharesubjecttovestingconditionsexpectedtooccurwithin60daysofAugust31,2017.(8) MichaelA.StankeyjoinedourboardofdirectorsinFebruary2017.(9) Consistsof(a)22,388,618shares,(b)9,677,426sharessubjecttostockoptionsthatareexercisablewithin60daysofAugust31,2017,(c)3,750RSUswhicharesubjectto

vestingconditionsexpectedtooccurwithin60daysofAugust31,2017,and(d)142,369sharessubjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations,eachofwhichareheldbyourdirectorsandofficersasagroup.

(10) Consistsof26,065,827sharesheldbyIntel.TheprincipalbusinessaddressforIntelis2200MissionCollegeBlvd.,SantaClara,California95054.(11) Consistsof(a)12,140,760sharesheldbyGreylockXIILimitedPartnership,orGreylockXII,(b)709,983sharesheldbyGreylockXIIPrincipalsLLC,GreylockXIILLC

and(c)1,348,968sharesheldbyGreylockXII‑ALimitedPartnership,orGreylockXII‑A.GreylockXIIGPLLC,orGreylockGP,servesasthegeneralpartnerofGreylockXIIandGreylockXII‑A.WilliamW.HelmanandAneelBhusriaretheseniormanagingmembersofGreylockGPandassuch,eachofthemmaybedeemedtosharevotingpowerandinvestmentcontroloverthesharesheldofrecordbyGreylockXIIandGreylockXII‑A.ThesharesregisteredinthenameofGreylockXIILLCareheldinnomineeformonlyandasaresult,GreylockXIILLCdoesnothavevotingpowerorinvestmentcontroloversuchshares.EachofthebeneficiariesforwhichGreylockXIILLCactsasnomineeretainssolevotingpowerandinvestmentcontrolwithrespecttothesharesheldontheirbehalf.Assuch,GreylockXIIPLLCdisclaimsbeneficialownershipwithrespecttoallsuchshares.Iftheoptiontopurchaseadditionalsharesisexercisedbytheunderwritersinfull,anadditional783,820sharesofcommonstockwillbesoldbyentitiesaffiliatedwithGreylock,afterwhichentitiesaffiliatedwithGreylockwillbeneficiallyown10,436,450sharesofcommonstock,whichrepresents7.5%ofthetotalvotingpowerafterthisoffering.TheprincipalbusinessaddressforallentitiesandindividualsaffiliatedwithGreylockPartnersis2550SandHillRoad,MenloPark,California94025.

(12)Consistsof(a)804,621shares,(b)765,497sharessubjecttooptionsthatareexercisablewithin60daysofAugust31,2017and(c)31,535sharessubjecttothesettlementRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations.

(13) Consistsofsellingstockholdersnototherwiselistedinthistablewhomwithinthegroupsindicatedcollectivelyownlessthan1%ofourcommonstock.Theamountsdonotincludeadditionalequityawardsforcommonstockthatarenotexercisable,orforwhichanyserviceconditionwouldnotbesatisfied,within60daysofAugust31,2017.

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DESCRIPTION OF CAPITAL STOCK

Ourauthorizedcapitalstockconsistsof1,200,000,000sharesofcommonstock,$0.00005parvaluepershare,and20,000,000sharesofundesignatedpreferredstock,$0.00005parvaluepershare.Thefollowingdescriptionsummarizesthemostimportanttermsofourcapitalstock.Becauseitisonlyasummary,itdoesnotcontainalltheinformationthatmaybeimportanttoyou.Foracompletedescription,youshouldrefertoourrestatedcertificateofincorporationandrestatedbylaws,whichareincludedasexhibitstotheregistrationstatementofwhichthisprospectusformsapart,andtotheprovisionsofapplicableDelawarelaw.

Common Stock

AsofJuly31,2017,therewere131,250,336sharesofourcommonstockoutstanding,heldbyapproximately822stockholdersofrecord,andnosharesofpreferredstockoutstanding.BasedonthenumberofsharesoutstandingasofJuly31,2017,therewillbeapproximately139,289,042sharesofourcommonstockoutstandingafterthisoffering,assumingtheissuanceof5,038,706sharesofcommonstocksubjecttothesettlementofRSUs,thesettlementofwhichwasconcurrentwiththepricingofthisoffering,aftergivingeffecttoshareswithheldtosatisfytheassociatedwithholdingtaxobligations.

Dividend Rights

Subjecttopreferencesthatmayapplytosharesofpreferredstockoutstandingatthetime,theholdersofoutstandingsharesofourcommonstockareentitledtoreceivedividendsoutoffundslegallyavailableatthetimesandintheamountsthatourboardofdirectorsmaydetermine.

Voting Rights

Eachholderofcommonstockisentitledtoonevoteforeachshareofcommonstockheldonallmatterssubmittedtoavoteofstockholders.Cumulativevotingfortheelectionofdirectorsisnotprovidedforinourrestatedcertificateofincorporation,whichmeansthattheholdersofamajorityofoursharesofcommonstockcanelectallofthedirectorsthenstandingforelection.

WehaveenteredintoavotingandstandstillagreementwithIntel,whichbecameeffectiveuponcompletionofourinitialpublicoffering,pursuanttowhichIntelhasagreedtocertainrestrictionsonitsvotingpower.TheserestrictionsincludealimitationofIntel’sindependentvotingrightsto20%oftheaggregatevotingrightsoftheaggregateoutstandingvotingcapitalstockofthecompany.Inaddition,Intelanditsaffiliatesarerequiredtocasttheircollectivevotingpowerinexcessofthe20%limitation(ExcessVotingPower)“for”or“against”thematterbeingvotedupon,includingmattersthatrequirethevoteofanyseparateseriesorclassvote,inthesameratioandinthesameproportionasthecompany’sotherstockholders,otherthanIntelanditsaffiliates,collectivelyvoted“for”or“against”suchmatter.Pursuanttothevotingandstandstillagreement,IntelexecutedanirrevocablevotingproxytouswithrespecttotheExcessVotingPower,tobeeffectiveuponthecompletionofthisoffering.Further,ifIntelanditsaffiliatescollectivelyhold66%ormoreofthevotingpowerwithrespectanymatterrequiringaseparateseriesorclassvoteunderSection242ofDelawareGeneralCorporationLaw,underrestatedcertificateofincorporationorotherwise,thenIntelanditsaffiliateswillberequiredtovotefororagainstsuchmatterasrecommendedbyourboardofdirectors.Intel’sproxyalsogivesusthepowertoeffectuatethisprovision.See“CertainRelationshipsandRelated‑PartyTransactions—VotingandStandstillAgreement”formoreinformation.

No Preemptive or Similar Rights

Ourcommonstockisnotentitledtopreemptiverightsandisnotsubjecttoconversionorredemption.

Right to Receive Liquidation Distributions

Uponourliquidation,dissolutionorwinding‑up,theassetslegallyavailablefordistributiontoourstockholderswouldbedistributableratablyamongtheholdersofourcommonstockandanyparticipatingpreferredstockoutstandingatthattimeafterpaymentofliquidationpreferences,ifany,onanyoutstandingsharesofpreferredstockandpaymentofotherclaimsofcreditors.

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Preferred Stock

Ourboardofdirectorsisauthorized,subjecttolimitationsprescribedbyDelawarelaw,toissuepreferredstockinoneormoreseries,toestablishfromtimetotimethenumberofsharestobeincludedineachseries,tofixthedesignation,powers,preferencesandrightsofthesharesofeachseriesandanyofitsqualifications,limitationsorrestrictions,ineachcasewithoutfurtheractionbyourstockholders.Ourboardofdirectorscanalsoincreaseordecreasethenumberofsharesofanyseriesofpreferredstock,butnotbelowthenumberofsharesofthatseriesthenoutstanding,unlessapprovedbytheaffirmativevoteoftheholdersofamajorityofourcapitalstockentitledtovote,orsuchothervoteasmayberequiredbythecertificateofdesignationestablishingtheseries.Ourboardofdirectorsmayauthorizetheissuanceofpreferredstockwithvotingorconversionrightsthatcouldadverselyaffectthevotingpowerorotherrightsoftheholdersofthecommonstock.Theissuanceofpreferredstock,whileprovidingflexibilityinconnectionwithpossibleacquisitionsandothercorporatepurposes,could,amongotherthings,havetheeffectofdelaying,deferringorpreventingachangeinourcontrolandmightadverselyaffectthemarketpriceofourcommonstockandthevotingandotherrightsoftheholdersofourcommonstock.Wehavenocurrentplantoissueanysharesofpreferredstock.

Options

AsofJuly31,2017,wehad(i)outstandingoptionstopurchaseanaggregateof22,181,142sharesofourcommonstock,withaweighted‑averageexercisepriceof$4.71pershareunderour2008PlanandtheGazzangPlanand(ii)outstandingoptionstopurchaseanaggregateof30,300sharesofourcommonstock,withaweighted‑averageexercisepriceof$21.50pershareunderour2017Plan.

Restricted Stock Units (RSUs)

AsofJuly31,2017,wehad(i)outstandingRSUsthatmaybesettledforanaggregateof22,841,098sharesofourcommonstockgrantedpursuanttoour2008Planand(ii)outstandingRSUsthatmaybesettledforanaggregateof1,356,850sharesofourcommonstockgrantedpursuanttoour2017Plan.

Registration Rights

Followingthisoffering,theholdersofapproximately73.0millionsharesofourcommonstockwillbeentitledtorightswithrespecttotheregistrationofthesesharesundertheSecuritiesAct,asdescribedbelow.

Demand Registration Rights

Atanytimeaftertheearlierof(i)March24,2017or(ii)180daysaftertheeffectivedateofourinitialpublicoffering,theholdersofatleastamajorityofthethen‑outstandingshareshavingregistrationrightscanrequestthatwefilearegistrationstatementcoveringatleastamajorityoftheregistrablesecuritiesthen‑outstandingwithananticipatedaggregateofferingpriceofgreaterthan$15.0million,netofanyunderwriters’discountsandcommissions.Wewillonlyberequiredtofiletworegistrationstatementsuponexerciseofthesedemandregistrationrights.Wemaypostponethefilingofaregistrationstatementforupto90daysonceinatwelvemonthperiodifourboardofdirectorsdeterminesthatthefilingwouldbeseriouslydetrimentaltousorourstockholders.

Piggyback Registration Rights

Ifweregisteranyofoursecuritiesforouraccountortheaccountofastockholder,thestockholderswithregistrationrightswillhavetherighttoincludetheirsharesintheregistrationstatement.However,thisrightdoesnotapplytoaregistrationrelatingtoanyofouremployeebenefitplans,acorporatereorganization,aregistrationthatrequiresinformationthatisnotsubstantiallythesameoraregistrationinwhichtheonlycommonstockbeingregisterediscommonstockissuableuponconversionofdebtsecuritiesthatarealsobeingregistered.Theunderwritersofanyunderwrittenofferingwillhavetherighttolimit,duetomarketingreasons,thenumberofsharesregisteredbytheseholders,inwhichcasethenumberofsharestoberegisteredwillbeapportionedprorataamongtheseholders,accordingtothetotalnumberofregistrablesecuritiesownedbyeachholder,orinamannermutuallyagreeduponbytheholders.However,thenumberofsharestoberegisteredbytheseholderscannotbereducedunlessallothersecurities(otherthansecuritiestobesoldbyourcompany)areexcludedentirelyandmaynotbe

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reducedbelow30%ofthetotalsharescoveredbytheregistrationstatement,exceptforinconnectionwithaninitialpublicoffering,inwhichcasetheunderwritersmayexcludetheseholdersentirely.

Form S-3 Registration Rights

Theholdersofatleast30%ofthethen‑outstandingshareshavingregistrationrightscanrequestthatweregisteralloraportionoftheirsharesonFormS‑3ifweareeligibletofilearegistrationstatementonFormS‑3andtheaggregatepricetothepublicofthesharesofferedisequaltoorgreaterthan$1,000,000,netofanyunderwriters’discountsandcommissions.ThisrightonlysurvivesfortwoFormS‑3registrationseffectedpursuanttothisright.WemaypostponethefilingofaregistrationstatementonFormS‑3forupto90daysonceinatwelvemonthperiodifourboardofdirectorsdeterminesthatthefilingwouldbeseriouslydetrimentaltousorourstockholders.Wewillnotberequiredtofilesucharegistrationstatementduringtheperiodthatis60daysbeforeand180daysaftertheeffectivedateofaregistrationinitiatedbyus.

TheseregistrationrightswillterminateupontheearliertooccuroftheclosingofadeemedliquidationeventorwhenthesharesheldbyandissuabletoIntelanditsaffiliatesmaybesoldwithoutregistrationincompliancewithRule144oftheSecuritiesAct.IntelanditsaffiliateshaveenteredintoagreementswiththeunderwritersprohibitingtheexerciseoftheirregistrationrightsuntilthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017.Foradescriptionoftheseagreements,see“Underwriters.”

Intel Corporation Form S-3 Registration Rights

AtanytimeafterweareeligibletofilearegistrationstatementonFormS‑3,IntelcanrequestthatweregisteralloraportionoftheirsharesonFormS‑3.Thisrightislimitedtooneregistrationstatementfilinginanytwelvemonthperiod.WemaypostponethefilingofaregistrationstatementforIntel’sregistrablesecuritiesonFormS‑3onetimeinatwelvemonthperiodforupto90daysifourboardofdirectorsdeterminesthatsuchafilingwouldbemateriallydetrimentaltousandourstockholders.Wewillnotberequiredtofilesucharegistrationstatementduringtheperiodthatis60daysbeforeand180daysaftertheeffectivedateofaregistrationinitiatedbyus.

TheseregistrationrightswillterminateupontheearliertooccuroftheclosingofadeemedliquidationeventorwhenthesharesheldbyandissuabletoIntelanditsaffiliatesmaybesoldwithoutregistrationincompliancewithRule144oftheSecuritiesAct.IntelanditsaffiliateshaveenteredintoagreementswiththeunderwritersnottomakeanydemandfororexercisetheirregistrationrightsuntilthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017.Foradescriptionoftheseagreements,see“Underwriters.”

Registration Expenses

Wewillpayallexpensesincurredinconnectionwitheachoftheregistrationsdescribedabove,exceptforunderwriters’andbrokers’discountsandcommissions.However,wewillnotpayforanyexpensesofanydemandregistrationorFormS‑3registrationiftherequestissubsequentlywithdrawnbyamajorityoftheholdersrequestingthatwefilesucharegistrationstatement,subjecttolimitedexceptions.

Termination of Registration Rights

Theregistrationrightswillterminateupontheearliertooccuroftheclosingofadeemedliquidationeventor,withrespecttoaparticularholderofregistrablesecurities,whenthesharesheldbyandissuabletosuchholdermaybesoldwithoutregistrationincompliancewithRule144oftheSecuritiesAct.

Defensive Measures

CertainprovisionsofDelawarelaw,ourrestatedcertificateofincorporationandourrestatedbylawsmayhavetheeffectofdelaying,deferringordiscouraginganotherpersonfromacquiringcontrolofourcompany.Theseprovisions,whicharesummarizedbelow,areexpectedtodiscouragecertaintypesofcoercivetakeoverpracticesandinadequatetakeoverbidsandencouragepersonsseekingtoacquirecontrolofourcompanytofirstnegotiatewithourboardofdirectors.

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Section 203 of the Delaware General Corporation Law

WearesubjecttotheprovisionsofSection203oftheDelawareGeneralCorporationLaw.Ingeneral,Section203prohibitsapubliclyheldDelawarecorporationfromengagingina“businesscombination”withan“interestedstockholder”forathree‑yearperiodfollowingthetimethatthisstockholderbecomesaninterestedstockholder,unlessthebusinesscombinationisapprovedinaprescribedmanner.UnderSection203,abusinesscombinationbetweenacorporationandaninterestedstockholderisprohibitedunlessitsatisfiesoneofthefollowingconditions:

• beforethestockholderbecameinterested,ourboardofdirectorsapprovedeitherthebusinesscombinationorthetransactionwhichresultedinthestockholderbecominganinterestedstockholder;

• uponconsummationofthetransactionwhichresultedinthestockholderbecominganinterestedstockholder,theinterestedstockholderownedatleast85%ofthevotingstockofthecorporationoutstandingatthetimethetransactioncommenced,excludingforpurposesofdeterminingthevotingstockoutstanding,sharesownedbypersonswhoaredirectorsandalsoofficers,andemployeestockplansinsomeinstances,butnottheoutstandingvotingstockownedbytheinterestedstockholder;or

• atorafterthetimethestockholderbecameinterested,thebusinesscombinationwasapprovedbyourboardofdirectorsandauthorizedatanannualorspecialmeetingofthestockholdersbytheaffirmativevoteofatleasttwo‑thirdsoftheoutstandingvotingstockwhichisnotownedbytheinterestedstockholder.

Section203definesabusinesscombinationtoinclude:

• anymergerorconsolidationinvolvingthecorporationandtheinterestedstockholder;

• anysale,transfer,lease,pledgeorotherdispositioninvolvingtheinterestedstockholderof10%ormoreoftheassetsofthecorporation;

• subjecttoexceptions,anytransactionthatresultsintheissuanceoftransferbythecorporationofanystockofthecorporationtotheinterestedstockholder;

• subjecttoexceptions,anytransactioninvolvingthecorporationthathastheeffectofincreasingtheproportionateshareofthestockofanyclassorseriesofthecorporationbeneficiallyownedbytheinterestedstockholder;and

• thereceiptbytheinterestedstockholderofthebenefitofanyloans,advances,guarantees,pledgesorotherfinancialbenefitsprovidedbyorthroughthecorporation.

Ingeneral,Section203definesaninterestedstockholderasanyentityorpersonbeneficiallyowning15%ormoreoftheoutstandingvotingstockofthecorporationandanyentityorpersonaffiliatedwithorcontrollingorcontrolledbytheentityorperson.

Restated Certificate of Incorporation and Restated Bylaw Provisions

Ourrestatedcertificateofincorporationandourrestatedbylawsincludeanumberofprovisionsthatmayhavetheeffectofdeterringhostiletakeovers,ordelayingorpreventingchangesincontrolofourmanagementteamorchangesinourboardofdirectorsorourgovernanceorpolicy,includingthefollowing:

• Board of Directors Vacancies .Ourrestatedbylawsandcertificateofincorporationauthorizegenerallyonlyourboardofdirectorstofillvacantdirectorshipsresultingfromanycauseorcreatedbytheexpansionofourboardofdirectors.Inaddition,thenumberofdirectorsconstitutingourboardofdirectorsmaybesetonlybyresolutionadoptedbyamajorityvoteofourentireboardofdirectors.Theseprovisionspreventastockholderfromincreasingthesizeofourboardofdirectorsandgainingcontrolofourboardofdirectorsbyfillingtheresultingvacancieswithitsownnominees.

• Classified Board .Ourrestatedcertificateofincorporationandrestatedbylawsprovidethatourboardisclassifiedintothreeclassesofdirectors.Theexistenceofaclassifiedboardcoulddelayasuccessfultender

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offerorfromobtainingmajoritycontrolofourboardofdirectors,andtheprospectofthatdelaymightdeterapotentialofferor.

• Stockholder Action .Ourrestatedcertificateofincorporationprovidesthatourstockholdersmaynottakeactionbywrittenconsent,butmayonlytakeactionatannualorspecialmeetingsofourstockholders.Stockholderswillnotbepermittedtocumulatetheirvotesfortheelectionofdirectors.Ourrestatedbylawsfurtherprovidethatspecialmeetingsofourstockholdersmaybecalledonlybyamajorityofourentireboardofdirectors.Ourbylawslimitthebusinessthatmaybeconductedatanannualmeetingofstockholderstothosemattersproperlybroughtbeforethemeeting.

• Holding Requirements for Stockholder Proposals and Director Nominations .Ourrestatedbylawsrequirecontinuous,beneficialownershipof1%ofourcommonstockforoneyearforstockholdersseekingtobringbusinessbeforeourannualmeetingofstockholdersortonominatecandidatesforelectionasdirectorsatourannualmeetingofstockholders.Ourbylawsalsorequirethatspecifiedinformationbeprovidedregardinganynominee(s),aswellastheproponent,andrequiresthenominee(s)toagreetobeboundbyourcorporategovernanceandcompliancepoliciesandguidelines,includingourinsidertrading,confidentialityandotherpolicies.Theseprovisionsmaydelayorprecludeourstockholdersfrombringingmattersbeforeourannualmeetingofstockholdersandfrommakingnominationsfordirectorsatourannualmeetingofstockholders.

• Advance Notice Requirements for Stockholder Proposals and Director Nominations .Ourrestatedbylawsprovideadvancenoticeproceduresforstockholdersseekingtobringbusinessbeforeourannualmeetingofstockholdersortonominatecandidatesforelectionasdirectorsatourannualmeetingofstockholders.Ourrestatedbylawsalsospecifycertainrequirementsregardingtheformandcontentofastockholder’snotice.Theseprovisionsmayprecludeourstockholdersfrombringingmattersbeforeourannualmeetingofstockholdersorfrommakingnominationsfordirectorsatourannualmeetingofstockholders.

• Amendment to Certificate of Incorporation and Bylaws .Certainamendmentstoourcertificateofincorporationrequireapprovalbytheholdersofatleasttwo‑thirdsofouroutstandingcommonstock.Anamendmenttoourbylawsrequirestheapprovalofamajorityofourentireboardofdirectorsorapprovalbytheholdersofatleasttwo‑thirdsofouroutstandingcommonstock.

• Issuance of Undesignated Preferred Stock .Ourboardofdirectorshastheauthority,withoutfurtheractionbythestockholders,toissueupto20,000,000sharesofundesignatedpreferredstockwithrightsandpreferences,includingvotingrights,designatedfromtimetotimebytheboardofdirectors.Theexistenceofauthorizedbutunissuedsharesofpreferredstockenablesourboardofdirectorstorendermoredifficultortodiscourageanattempttoobtaincontrolofusbymeansofamerger,tenderoffer,proxycontestorotherwise.

Choice of Forum

OurrestatedcertificateofincorporationprovidesthattheCourtofChanceryoftheStateofDelawareistheexclusiveforumforanyderivativeactionorproceedingbroughtonourbehalf;anyactionassertingabreachoffiduciaryduty;anyactionassertingaclaimagainstusarisingpursuanttotheDelawareGeneralCorporationLaw,ourrestatedcertificateofincorporationorourrestatedbylaws;anyactiontointerpret,apply,enforceordeterminethevalidityofourrestatedcertificateofincorporationorbylaws;oranyactionassertingaclaimagainstusthatisgovernedbytheinternalaffairsdoctrine.Theenforceabilityofsimilarchoiceofforumprovisionsinothercompanies’certificatesofincorporationhasbeenchallengedinlegalproceedingsanditispossiblethatacourtcouldfindthesetypesofprovisionstobeinapplicableorunenforceable.

Stock Exchange Listing

OurcommonstockislistedontheNewYorkStockExchangeunderthesymbol“CLDR.”

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Transfer Agent and Registrar

ThetransferagentandregistrarforourcommonstockisAmericanStockTransfer&TrustCompany,LLC.Thetransferagent’saddressisOperationsCenter,620115thAvenue,Brooklyn,NY11219,anditstelephonenumberis(800)937‑5449.

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SHARES ELIGIBLE FOR FUTURE SALE

Futuresalesofsubstantialamountsofourcommonstock,includingsharesissueduponexerciseofoutstandingoptions,inthepublicmarketafterthisofferingcouldadverselyaffectmarketpricesprevailingfromtimetotimeandcouldimpairourabilitytoraisecapitalthroughthesaleofourequitysecurities.

Uponthecompletionofthisoffering,basedonthenumberofsharesoutstandingasofJuly31,2017,wewillhave139,289,042sharesofcommonstockoutstanding.Oftheseoutstandingshares,allofthe13,432,114sharessoldinthisofferingwillbefreelytradable,exceptthatanysharespurchasedbyouraffiliates,asthattermisdefinedinRule144undertheSecuritiesAct,mayonlybesoldincompliancewiththelimitationsdescribedbelow.

TheremainingoutstandingsharesofourcommonstockwillbedeemedrestrictedsecuritiesasdefinedunderRule144.RestrictedsecuritiesmaybesoldinthepublicmarketonlyifregisteredoriftheyqualifyforanexemptionfromregistrationunderRule144orRule701promulgatedundertheSecuritiesAct,whichrulesaresummarizedbelow.Inaddition,allofourstockholdershaveenteredintomarketstandoffagreementswithusorlock‑upagreementswiththeunderwritersunderwhichtheyagreed,subjecttospecificexceptions,nottosellanyoftheirstockasdescribedbelow.SubjecttotheprovisionsofRule144orRule701,sharesareorwillbeavailableforsaleinthepublicmarketasfollows:

• onthedateofthisprospectus,29,482,114sharesofourcommonstock(includingall13,432,114sharesofourcommonstocksoldinthisoffering,whichincludes10,432,114sharesofcommonstocktobesoldinthisofferingbysellingstockholdersthatMorganStanley&Co.LLC,onbehalfoftheunderwriters,hasreleasedfromlock-uprestrictions,including5,885,154sharesbeneficiallyownedbyourdirectorsandexecutiveofficersandtheiraffiliatedentities,andall16,050,000sharesofourcommonstocksoldinourinitialpublicofferingtonon-affiliates)areavailableforsaleinthepublicmarket,exceptforthesharespurchasedbyaffiliatesinthisofferingwhicharesubjecttothevolumeandotherrestrictionsofRule144aswellasthelock-upagreementrestrictionsdescribedbelow;

• 50,164,654shareswillbeeligibleforsaleonOctober25,2017inthepublicmarketupontheexpirationoflock‑upagreementsenteredintoinconnectionwithourinitialpublicoffering,ofwhich10,951,361sharesareheldbypersonssubjecttoourinsidertradingpolicyandaresubjecttoquarterly“black-out”restrictionsontradinguntilafterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendingOctober31,2017;

• 31,317,935additionalshareswillbecomeeligibleforsaleinthepublicmarketupontheexpirationoflock‑upagreementsenteredintoinconnectionwiththisofferingafterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendingOctober31,2017,ofwhich26,065,827shareswillbeheldbyIntelandsubjecttothevolumeandotherrestrictionsofRule144,asdescribedbelow;

• 29,891,858additionalshareswillbeeligibleforsaleinthepublicmarketupontheexpirationoflock-upagreementsenteredintoinconnectionwiththisofferingasfollows:withrespecttothenumberofsharesofcommonstockequalto50%ofthecommonstock(includingsecuritiesconvertibleinto,andexercisablefor,sharesofourcommonstock)heldbytheholderimmediatelybeforetheconsummationofthisoffering,lessanysharessoldinthisoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendingOctober31,2017and(b)withrespecttotheremaining50%oftheseshares(includingsecuritiesconvertibleinto,andexercisablefor,sharesofourcommonstock)heldbytheholderimmediatelybeforetheconsummationofthisoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendingJanuary31,2018,ofwhich18,671,588shareswillbeheldbyaffiliatesandsubjecttothevolumeandotherrestrictionsofRule144,asdescribedbelow;and

• theremainderoftheshareswillbeeligibleforsaleinthepublicmarketfromtimetotimethereafter,subjectinsomecasestothevolumeandotherrestrictionsofRule144,asdescribedbelow.

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Lock‑‑Up Agreements

Inconnectionwithourinitialpublicoffering,allofourdirectors,executiveofficers,theholdersofsubstantiallyallofourthencommonstockandsecuritiesconvertibleintoorexchangeableforourcommonstockenteredintolock‑upagreementswiththeunderwriterspriortothecommencementofthisofferingpursuanttowhicheachofthesepersonsorentities,withlimitedexceptions,untilOctober25,2017,maynot,withoutthepriorwrittenconsentofMorganStanley&Co.LLC,offer,pledge,sell,contracttosell,sellanyoptionorcontracttopurchase,purchaseanyoptionorcontracttosell,grantanyoption,rightorwarranttopurchase,lendorotherwisetransferordisposeof,directlyorindirectly,anysharesofourcommonstockoranysecuritiesconvertibleintoorexercisableorexchangeableforourcommonstock.See“Underwriters”foradditionalinformation.

Inaddition,inconnectionwiththisoffering,we,alldirectorsandexecutiveofficers,thesellingstockholdersandcertainotherholdersofourcommonstock,includingAccel,GreylockPartnersandIntel,agreedthat,withoutthepriorwrittenconsentofMorganStanley&Co.LLConbehalfoftheunderwritersandsubjecttocertainexceptions,weandtheywillnot,offer,sell,oragreetosell,directlyorindirectly,anysharesofcommonstockuntil(i)withrespecttoalldirectors,IntelandthesellingstockholdersexceptforAccelandGreylock,thecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017and(ii)withrespecttoourexecutiveofficersandAccelandGreylock,withrespecttothenumberofshareofcommonstockequaltofiftypercentofthecommonstockheldbythemimmediatelybeforetheconsummationofthepublicoffering,lessanysharessoldinthisoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017andwithrespecttotheremainingfiftypercentofthecommonstockheldbythemimmediatelybeforetheconsummationofthepublicoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedJanuary31,2018.See“Underwriters”foradditionalinformation.

Rule 144

Ingeneral,underRule144ascurrentlyineffect,apersonwhoisnotdeemedtohavebeenoneofouraffiliatesforpurposesoftheSecuritiesActatanytimeduringthe90daysprecedingasaleandwhohasbeneficiallyownedthesharesproposedtobesoldforatleastsixmonths,includingtheholdingperiodofanypriorownerotherthanouraffiliates,isentitledtosellthoseshareswithoutcomplyingwiththemannerofsale,volumelimitationornoticeprovisionsofRule144,subjecttocompliancewiththepublicinformationrequirementsofRule144.Ifsuchapersonhasbeneficiallyownedthesharesproposedtobesoldforatleastoneyear,includingtheholdingperiodofanypriorownerotherthanouraffiliates,thenthatpersonisentitledtosellthoseshareswithoutcomplyingwithanyoftherequirementsofRule144.

Ingeneral,underRule144,ascurrentlyineffect,ouraffiliatesorpersonssellingsharesonbehalfofouraffiliatesareentitledtoselluponexpirationofthelock‑upagreementsdescribedabove,withinanythree‑monthperiodbeginning90daysafterthedateofthisprospectus,anumberofsharesthatdoesnotexceedthegreaterof:

• 1%ofthenumberofsharesofcommonstockthenoutstanding,whichwillequalapproximately1,392,890sharesimmediatelyafterthisoffering;or

• TheaverageweeklytradingvolumeofthecommonstockduringthefourcalendarweeksprecedingthefilingofanoticeonForm144withrespecttothatsale.

SalesunderRule144byouraffiliatesorpersonssellingsharesonbehalfofouraffiliatesarealsosubjecttocertainmannerofsaleprovisionsandnoticerequirementsandtotheavailabilityofcurrentpublicinformationaboutus.

Rule 701

Rule701generallyallowsastockholderwhopurchasedsharesofourcommonstockpursuanttoawrittencompensatoryplanorcontractandwhoisnotdeemedtohavebeenanaffiliateofourcompanyduringtheimmediatelypreceding90daystosellthesesharesinrelianceuponRule144,butwithoutbeingrequiredtocomplywiththepublicinformationandholdingperiodrequirementsofRule144.Rule701alsopermitsaffiliatesofour

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companytoselltheirRule701sharesunderRule144withoutcomplyingwiththeholdingperiodrequirementsofRule144.

Registration Statement

WehavefiledaregistrationstatementonFormS‑8undertheSecuritiesActcoveringallofthesharesofourcommonstocksubjecttooutstandingstockoptionsandRSUsandreservedforfutureissuanceunderourequityincentiveplans.However,thesharesregisteredonFormS‑8maybesubjecttothevolumelimitationsandthemannerofsale,notice,andpublicinformationrequirementsofRule144andwillnotbeeligibleforresaleuntilexpirationoftheapplicablelock‑upagreementsandmarketstandoffprovisionstowhichtheyaresubject.

Registration Rights

Wehavegranteddemandregistrationrights,rightstoparticipateinofferingsthatweinitiateandFormS‑3registrationrightstocertainofourstockholderstosellourcommonstock.Forafurtherdescriptionoftheserights,see“DescriptionofCapitalStock—RegistrationRights.”

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MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS FOR NON‑‑U.S. HOLDERS OF COMMON STOCK

ThissectionsummarizesthematerialU.S.federalincometaxconsiderationsrelatingtotheacquisition,ownershipanddispositionofourcommonstockacquiredinthisofferingby“non‑U.S.holders”(asdefinedbelow).ThissummarydoesnotprovideacompleteanalysisofallpotentialU.S.federalincometaxconsiderationsrelatingthereto.TheinformationprovidedbelowisbaseduponprovisionsoftheInternalRevenueCodeof1986,asamended,ortheCode,Treasuryregulationspromulgatedthereunder,administrativerulings,andjudicialdecisionscurrentlyineffect.Theseauthoritiesmaychangeatanytime,possiblyretroactively,ortheInternalRevenueService(IRS)mightinterprettheexistingauthoritiesdifferently.Ineithercase,thetaxconsiderationsofowningordisposingofourcommonstockcoulddifferfromthosedescribedbelow.Asaresult,wecannotassureyouthatthetaxconsequencesdescribedinthisdiscussionwillnotbechallengedbytheIRSorwillbesustainedbyacourtifchallengedbytheIRS.

Thissummarydoesnotaddressthetaxconsiderationsarisingunderthelawsofanynon‑U.S.,stateorlocaljurisdiction,or,excepttothelimitedextentprovidedbelow,underU.S.federalestateandgifttaxlaws.Inaddition,thisdiscussiondoesnotaddresstaxconsiderationsapplicabletoaninvestor’sparticularcircumstancesortoinvestorsthatmaybesubjecttospecialtaxrules,including,withoutlimitation:

• banks,insurancecompaniesorotherfinancialinstitutions;

• corporationsthataccumulateearningstoavoidU.S.federalincometax;

• personssubjecttothealternativeminimumtaxortheMedicarecontributiontax;

• taxexemptorganizationsortaxqualifiedretirementplans;

• controlledforeigncorporationsorpassiveforeigninvestmentcompanies;

• personswhoacquiredourcommonstockascompensationforservices;

• dealersinsecuritiesorcurrencies;

• tradersinsecuritiesthatelecttouseamarktomarketmethodofaccountingfortheirsecuritiesholdings;

• personsthatown,oraredeemedtoown,morethan5%ofourcapitalstock(excepttotheextentspecificallysetforthbelow);

• certainformercitizensorlongtermresidentsoftheUnitedStates;

• personswhodonotholdourcommonstockasacapitalassetwithinthemeaningofSection1221oftheCode(generally,forinvestmentpurposes);

• personswhoholdourcommonstockasapositioninahedgingtransaction,“straddle,”“conversiontransaction”orotherriskreductiontransaction;or

• personsdeemedtosellourcommonstockundertheconstructivesaleprovisionsoftheCode.

Inaddition,ifapartnershiporentityclassifiedasapartnershipforU.S.federalincometaxpurposesisabeneficialownerofourcommonstock,thetaxtreatmentofapartnerinthepartnershiporanowneroftheentitywilldependuponthestatusofthepartnerorotherownerandtheactivitiesofthepartnershiporotherentity.Accordingly,thissummarydoesnotaddresstaxconsiderationsapplicabletopartnershipsthatholdourcommonstock,andpartnersinsuchpartnershipsshouldconsulttheirtaxadvisors.

INVESTORS CONSIDERING THE PURCHASE OF OUR COMMON STOCK SHOULD CONSULT THEIR OWN TAX ADVISORSREGARDING THE APPLICATION OF THE U.S. FEDERAL INCOME AND ESTATE TAX LAWS TO THEIR PARTICULAR SITUATIONS ANDTHE CONSEQUENCES OF FOREIGN, STATE OR LOCAL LAWS, AND TAX TREATIES.

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Non‑‑U.S. Holder Defined

Forpurposesofthissummary,a“non‑U.S.holder”isanybeneficialownerofourcommonstock,otherthanapartnership,thatisnot,forU.S.federalincometaxpurposes,anyofthefollowing:

• anindividualwhoisacitizenorresidentoftheUnitedStates;

• acorporation,orotherentitytaxableasacorporationforU.S.federalincometaxpurposes,createdororganizedunderthelawsoftheUnitedStates,anystatethereinortheDistrictofColumbia;

• atrustifit(i)issubjecttotheprimarysupervisionofaU.S.courtandoneofmoreU.S.personshaveauthoritytocontrolallsubstantialdecisionsofthetrustor(ii)hasavalidelectionineffectunderapplicableU.S.TreasuryregulationstobetreatedasaU.S.person;or

• anestatewhoseincomeissubjecttoU.S.incometaxregardlessofsource.

Ifyouareanindividualwhoisanon‑U.S.citizen,youmay,insomecases,bedeemedtobearesidentalien,asopposedtoanonresidentalien,byvirtueofbeingpresentintheUnitedStatesforatleast31daysinthecalendaryearandforanaggregateofatleast183daysduringathree‑yearperiodendinginthecurrentcalendaryear.Forthesepurposes,allthedayspresentinthecurrentyear,one‑thirdofthedayspresentintheimmediatelyprecedingyear,andone‑sixthofthedayspresentinthesecondprecedingyeararecounted.ResidentaliensaresubjecttoU.S.federalincometaxasiftheywereU.S.citizens.SuchanindividualisurgedtoconsulthisorherowntaxadvisorregardingtheU.S.federalincometaxconsequencesoftheownershipordispositionofourcommonstock.

Dividends

Wedonotexpecttodeclareormakeanydistributionsonourcommonstockintheforeseeablefuture.Ifwedopaydividendsonsharesofourcommonstock,however,suchdistributionswillconstitutedividendsforU.S.federalincometaxpurposestotheextentpaidfromourcurrentoraccumulatedearningsandprofits,asdeterminedunderU.S.federalincometaxprinciples.Distributionsinexcessofourcurrentandaccumulatedearningsandprofitswillconstituteareturnofcapitalthatisappliedagainstandreduces,butnotbelowzero,anon‑U.S.holder’sadjustedtaxbasisinsharesofourcommonstock.Anyremainingexcesswillbetreatedasgainrealizedonthesaleorotherdispositionofourcommonstock.See“—SaleofCommonStock”below.

Anydividendpaidtoanon‑U.S.holderonourcommonstockthatisnoteffectivelyconnectedwithanon‑U.S.holder’sconductofatradeorbusinessintheUnitedStateswillgenerallybesubjecttoU.S.withholdingtaxata30%rate.Thewithholdingtaxmightapplyatareducedrate,however,underthetermsofanapplicableincometaxtreatybetweentheUnitedStatesandthenon‑U.S.holder’scountryofresidence.Youshouldconsultyourowntaxadvisorsregardingyourentitlementtobenefitsunderarelevantincometaxtreaty.Generally,inorderforusorourpayingagenttowithholdtaxatalowertreatyrate,anon‑U.S.holdermustcertifyitsentitlementtotreatybenefits.Anon‑U.S.holdergenerallycanmeetthiscertificationrequirementbyprovidingaFormW‑8BEN,W‑8BENEorotherappropriateform(oranysuccessororsubstituteformthereof)tousorourpayingagent.Ifthenon‑U.S.holderholdsthestockthroughafinancialinstitutionorotheragentactingontheholder’sbehalf,theholderwillberequiredtoprovideappropriatedocumentationtotheholder’sagent.Theholder’sagentwillthenberequiredtoprovidecertificationtousorourpayingagent,eitherdirectlyorthroughotherintermediaries.IfyouareeligibleforareducedrateofU.S.federalwithholdingtaxunderanincometaxtreaty,youmayobtainarefundorcreditofanyexcessamountswithheldbyfilinganappropriateclaimforarefundwiththeIRSinatimelymanner.

Dividendsreceivedbyanon‑U.S.holderthatareeffectivelyconnectedwithaU.S.tradeorbusinessconductedbythenon‑U.S.holder,andifrequiredbyanapplicableincometaxtreatybetweentheUnitedStatesandthenon‑U.S.holder’scountryofresidence,areattributabletoapermanentestablishmentmaintainedbythenon‑U.S.holderintheUnitedStates,arenotsubjecttoU.S.withholdingtax.Toobtainthisexemption,anon‑U.S.holdermustprovideusorourpayingagentwithanIRSFormW‑8ECIproperlycertifyingsuchexemption.Sucheffectivelyconnecteddividends,althoughnotsubjecttowithholdingtax,aretaxedatthesamegraduatedratesapplicabletoU.S.persons,netofcertaindeductionsandcredits.Inadditiontobeingtaxedatgraduatedtaxrates,dividendsreceivedbyacorporatenon‑U.S.holderthatareeffectivelyconnectedwitha

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U.S.tradeorbusinessofthecorporatenon‑U.S.holdermayalsobesubjecttoabranchprofitstaxatarateof30%orsuchlowerrateasmaybespecifiedbyanapplicabletaxtreaty.

Seealsothesectionbelowtitled“—ForeignAccountTaxComplianceAct”foradditionalwithholdingrulesthatmayapplytodividendspaidtocertainforeignfinancialinstitutionsornon-financialforeignentities.

Sale of Common Stock

SubjecttothediscussionbelowregardingBackupWithholdingandInformationReportingandtheForeignAccountTaxComplianceAct,non‑U.S.holderswillgenerallynotbesubjecttoU.S.federalincometaxonanygainsrealizedonthesale,exchangeorotherdispositionofourcommonstockunless:

• thegain(i)iseffectivelyconnectedwiththeconductbythenon‑U.S.holderofaU.S.tradeorbusinessand(ii)ifrequiredbyanapplicableincometaxtreatybetweentheUnitedStatesandthenon‑U.S.holder’scountryofresidence,isattributabletoapermanentestablishmentmaintainedbythenon‑U.S.holderintheUnitedStates(inwhichcasethespecialrulesdescribedbelowapply);

• thenon‑U.S.holderisanindividualwhoispresentintheUnitedStatesfor183daysormoreinthetaxableyearofthesale,exchangeorotherdispositionofourcommonstock,andcertainotherrequirementsaremet(inwhichcasethegainwouldbesubjecttoaflat30%tax,orsuchreducedrateasmaybespecifiedbyanapplicableincometaxtreaty,whichmaybeoffsetbyU.S.sourcecapitallosses,eventhoughtheindividualisnotconsideredaresidentoftheUnitedStates);or

• therulesoftheForeignInvestmentinRealPropertyTaxAct(FIRPTA)treatthegainaseffectivelyconnectedwithaU.S.tradeorbusiness.

TheFIRPTArulesmayapplytoasale,exchangeorotherdispositionofourcommonstockifweare,orwerewithintheshorterofthefive‑yearperiodprecedingthedispositionandthenon‑U.S.holder’sholdingperiod,a“U.S.realpropertyholdingcorporation”(USRPHC).Ingeneral,wewouldbeaUSRPHCifinterestsinU.S.realestatecomprisedatleasthalfofthevalueofourbusinessassets.WedonotbelievethatweareaUSRPHCandwedonotanticipatebecomingoneinthefuture.EvenifwebecomeaUSRPHC,gainrealizedbyaNonU.S.HolderonadispositionofourcommonstockwillnotbesubjecttoU.S.federalincometaxsolongas(1)theNonU.S.Holderowned,directly,indirectlyorconstructively,nomorethanfivepercentofourcommonstockatalltimeswithintheshorterof(i)thefiveyearperiodprecedingthedispositionor(ii)theholder’sholdingperiodand(2)ourcommonstockisregularlytradedonanestablishedsecuritiesmarket.

Ifanygainfromthesale,exchangeorotherdispositionofourcommonstock,(i)iseffectivelyconnectedwithaU.S.tradeorbusinessconductedbyanon‑U.S.holderand(ii)ifrequiredbyanapplicableincometaxtreatybetweentheUnitedStatesandthenon‑U.S.holder’scountryofresidence,isattributabletoapermanentestablishmentmaintainedbysuchnon‑U.S.holderintheUnitedStates,thenthegaingenerallywillbesubjecttoU.S.federalincometaxatthesamegraduatedratesapplicabletoU.S.persons,netofcertaindeductionsandcredits.Ifthenon‑U.S.holderisacorporation,undercertaincircumstances,thatportionofitsearningsandprofitsthatiseffectivelyconnectedwithitsU.S.tradeorbusiness,subjecttocertainadjustments,generallywouldbesubjectalsotoa“branchprofitstax”atarateof30%orsuchlowerrateasmaybespecifiedbyanapplicableincometaxtreaty.

U.S. Federal Estate Tax

TheestatesofnonresidentalienindividualsgenerallyaresubjecttoU.S.federalestatetaxonpropertywithaU.S.situs.BecauseweareaU.S.corporation,ourcommonstockwillbeU.S.situspropertyandthereforewillbeincludedinthetaxableestateofanonresidentaliendecedent,unlessanapplicableestatetaxtreatybetweentheUnitedStatesandthedecedent’scountryofresidenceprovidesotherwise.Theterms“resident”and“nonresident”aredefineddifferentlyforU.S.federalestatetaxpurposesthanforU.S.federalincometaxpurposes.InvestorsareurgedtoconsulttheirowntaxadvisorsregardingtheU.S.federalestatetaxconsequencesoftheownershipordispositionofourcommonstock.

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Backup Withholding and Information Reporting

TheCodeandtheTreasuryregulationsrequirethosewhomakespecifiedpaymentstoreportthepaymentstotheIRS.Amongthespecifiedpaymentsaredividendsandproceedspaidbybrokerstotheircustomers.TherequiredinformationreturnsenabletheIRStodeterminewhethertherecipientproperlyincludedthepaymentsinincome.Thisreportingregimeisreinforcedby“backupwithholding”rules.Theserulesrequirethepayorstowithholdtaxfrompaymentssubjecttoinformationreportingiftherecipientfailstocooperatewiththereportingregimebyfailingtoprovidehistaxpayeridentificationnumbertothepayor,furnishinganincorrectidentificationnumber,orfailingtoreportinterestordividendsonhisreturns.Thebackupwithholdingtaxrateiscurrently28%.Thebackupwithholdingrulesdonotapplytopaymentstoforeigncorporations,providedtheyestablishsuchexemption.

Paymentstonon‑U.S.holdersofdividendsoncommonstockgenerallywillnotbesubjecttobackupwithholding,andpaymentsofproceedsmadetonon‑U.S.holdersbyabrokeruponasaleofcommonstockwillnotbesubjecttoinformationreportingorbackupwithholding,ineachcasesolongasthenon‑U.S.holdercertifiesitsnonresidentstatus(andweortheapplicablepayingagentdonothaveactualknowledgeorreasontoknowtheholderisaU.S.personorthattheconditionsofanyotherexemptionarenot,infact,satisfied)orotherwiseestablishesanexemption.Thecertificationprocedurestoclaimtreatybenefitsdescribedunder“— Dividends”abovewillgenerallysatisfythecertificationrequirementsnecessarytoavoidthebackupwithholdingtax.WemustreportannuallytotheIRSanydividendspaidtoeachnon‑U.S.holderandthetaxwithheld,ifany,withrespecttothesedividends.Copiesofthesereportsmaybemadeavailabletotaxauthoritiesinthecountrywherethenon‑U.S.holderresides.

UndertheTreasuryregulations,thepaymentofproceedsfromthedispositionofsharesofourcommonstockbyanon‑U.S.holdermadetoorthroughaU.S.officeofabrokergenerallywillbesubjecttoinformationreportingandbackupwithholdingunlessthebeneficialownercertifies,underpenaltiesofperjury,amongotherthings,itsstatusasanon‑U.S.holder(andthebrokerdoesnothaveactualknowledgeorreasontoknowtheholderisaU.S.person)orotherwiseestablishesanexemption.Thepaymentofproceedsfromthedispositionofsharesofourcommonstockbyanon‑U.S.holdermadetoorthroughanon‑U.S.officeofabrokergenerallywillnotbesubjecttobackupwithholdingandinformationreporting.Informationreporting,butnotbackupwithholding,however,willapplytoapaymentofproceeds,evenifthatpaymentismadeoutsideoftheUnitedStates,ifyousellourcommonstockthroughanon‑U.S.officeofabrokerthatis:

• aU.S.person(includingaforeignbranchorofficeofsuchperson);

• a“controlledforeigncorporation”forU.S.federalincometaxpurposes;

• aforeignperson50%ormoreofwhosegrossincomefromcertainperiodsiseffectivelyconnectedwithaU.S.tradeorbusiness;or

• aforeignpartnershipifatanytimeduringitstaxyear(a)oneormoreofitspartnersareU.S.personswho,intheaggregate,holdmorethan50%oftheincomeorcapitalinterestsofthepartnershipor(b)theforeignpartnershipisengagedinaU.S.tradeorbusiness;

unlessthebrokerhasdocumentaryevidencethatthebeneficialownerisanon‑U.S.holderandcertainotherconditionsaresatisfied,orthebeneficialownerotherwiseestablishesanexemption(andthebrokerhasnoactualknowledgeorreasontoknowtothecontrary).

Backupwithholdingisnotanadditionaltax.AnyamountswithheldfromapaymenttoaholderofcommonstockunderthebackupwithholdingrulescanbecreditedagainstanyU.S.federalincometaxliabilityoftheholder,ifany,andmayentitletheholdertoarefund,providedthattherequiredinformationisfurnishedtotheIRSinatimelymanner.

Foreign Account Tax Compliance Act

Inadditionto,andseparatelyfromthewithholdingrulesdescribedabove,U.S.federalwithholdingtaxesmayapplyundertheForeignAccountTaxComplianceAct(FATCA)oncertaintypesofpayments,includingdividendsandthegrossproceedsofadispositionofourcommonstock,madetonon‑U.S.financialinstitutionsandcertain

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othernon‑U.S.entities.Specifically,a30%withholdingtaxmaybeimposedondividendson,orgrossproceedsfromthesaleorotherdispositionof,ourcommonstockpaidtoa“foreignfinancialinstitution”ora“non‑financialforeignentity”(eachasdefinedintheCode),unless(1)theforeignfinancialinstitutionundertakescertaindiligenceandreportingobligations,(2)thenon‑financialforeignentityeithercertifiesitdoesnothaveany“substantialUnitedStatesowners”(asdefinedintheCode)orfurnishesidentifyinginformationregardingeachsubstantialUnitedStatesowner,or(3)theforeignfinancialinstitutionornon‑financialforeignentityotherwisequalifiesforanexemptionfromtheserules.The30%federalwithholdingtaxdescribedinthisparagraphcannotbereducedunderanincometaxtreatywiththeUnitedStates.Ifthepayeeisaforeignfinancialinstitutionandissubjecttothediligenceandreportingrequirementsin(1)above,itmustenterintoanagreementwiththeU.S.DepartmentoftheTreasuryrequiring,amongotherthings,thatitundertaketoidentifyaccountsheldbycertain“specifiedUnitedStatespersons”or“UnitedStates‑ownedforeignentities”(eachasdefinedintheCode),annuallyreportcertaininformationaboutsuchaccounts,andwithhold30%oncertainpaymentstonon‑compliantforeignfinancialinstitutionsandcertainotheraccountholders.ForeignfinancialinstitutionslocatedinjurisdictionsthathaveanintergovernmentalagreementwiththeUnitedStatesgoverningFATCAmaybesubjecttodifferentrules.

UnderapplicableTreasuryRegulationsandIRSguidance,FATCAwithholdingasdescribedabovecurrentlyapplytopaymentsofdividendsonourcommonstock,andwillalsoapplytopaymentsofgrossproceedsfromthesaleorotherdispositionofourcommonstockmadeonorafterJanuary1,2019.

ProspectiveinvestorsshouldconsulttheirtaxadvisorsregardingthepotentialapplicationofwithholdingunderFATCAtotheirinvestmentinourcommonstock.

THE PRECEDING DISCUSSION OF U.S. FEDERAL TAX CONSIDERATIONS IS FOR GENERAL INFORMATION PURPOSES ONLY. IT ISNOT TAX ADVICE. EACH PROSPECTIVE INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING THE PARTICULARU.S. FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF PURCHASING, HOLDING AND DISPOSING OF OUR COMMONSTOCK, INCLUDING THE CONSEQUENCES OF ANY PROPOSED CHANGE IN APPLICABLE LAWS.

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UNDERWRITERS

Underthetermsandsubjecttotheconditionscontainedinanunderwritingagreement,theunderwritersnamedbelow,forwhomMorganStanley&Co.LLCandJ.P.MorganSecuritiesLLCareactingasrepresentatives,haveseverallyagreedtopurchase,andweandthesellingstockholdershaveagreedtoselltothem,severally,thenumberofsharesindicatedbelow:

Name Number of Shares

MorganStanley&Co.LLC 4,298,277J.P.MorganSecuritiesLLC 2,955,066Allen&CompanyLLC 2,014,817MerrillLynch,Pierce,Fenner&Smith

Incorporated 1,343,211CitigroupGlobalMarketsInc. 1,343,211DeutscheBankSecuritiesInc. 1,074,569Stifel,Nicolaus&CompanyIncorporated 134,321JMPSecuritiesLLC 134,321RaymondJames&Associates,Inc. 134,321

Total: 13,432,114

Theunderwritersandtherepresentativesarecollectivelyreferredtoasthe“underwriters”andthe“representatives,”respectively.Theunderwritersareofferingthesharesofcommonstocksubjecttotheiracceptanceofthesharesfromusandthesellingstockholdersandsubjecttopriorsale.Theunderwritingagreementprovidesthattheobligationsoftheseveralunderwriterstopayforandacceptdeliveryofthesharesofcommonstockofferedbythisprospectusaresubjecttotheapprovalofcertainlegalmattersbytheircounselandtocertainotherconditions.Theunderwritersareobligatedtotakeandpayforallofthesharesofcommonstockofferedbythisprospectusifanysuchsharesaretaken.However,theunderwritersarenotrequiredtotakeorpayforthesharescoveredbytheunderwriters’optiontopurchaseadditionalsharesdescribedbelow.

Theunderwritersinitiallyproposetoofferpartofthesharesofcommonstockdirectlytothepublicattheofferingpricelistedonthecoverpageofthisprospectusandparttocertaindealersatapricethatrepresentsaconcessionnotinexcessof$0.3948pershareunderthepublicofferingprice.Aftertheinitialofferingofthesharesofcommonstock,theofferingpriceandothersellingtermsmayfromtimetotimebevariedbytherepresentatives.SalesofcommonstockmadeoutsideoftheUnitedStatesmaybemadebyaffiliatesoftheunderwriters.

Thesellingstockholdershavegrantedtotheunderwritersanoption,exercisablefor30daysfromthedateofthisprospectus,topurchaseupto2,014,816additionalsharesofcommonstockatthepublicofferingpricelistedonthecoverpageofthisprospectus,lessunderwritingdiscountsandcommissions.Totheextenttheoptionisexercised,eachunderwriterwillbecomeobligated,subjecttocertainconditions,topurchaseaboutthesamepercentageoftheadditionalsharesofcommonstockasthenumberlistednexttotheunderwriter’snameintheprecedingtablebearstothetotalnumberofsharesofcommonstocklistednexttothenamesofallunderwritersintheprecedingtable.

Thefollowingtableshowsthepershareandtotalpublicofferingprice,underwritingdiscountsandcommissions,andproceedsbeforeexpensestousandthesellingstockholders.Theseamountsareshownassumingbothnoexerciseandfullexerciseoftheunderwriters’optiontopurchaseupto2,014,816additionalshares.

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Total

Per Share No Exercise Full Exercise

Publicofferingprice $ 16.450 $ 220,958,275 $ 254,101,999

Underwritingdiscountsandcommissionstobepaidby: Us 0.658 1,980,000 1,980,000

Thesellingstockholders 0.658 6,885,195 8,214,974

Proceeds,beforeexpenses,tous 15.792 47,370,000 47,370,000

Proceeds,beforeexpenses,tothesellingstockholders $ 15.792 $ 164,723,080 $ 196,537,025

Theestimatedofferingexpenses,exclusiveoftheunderwritingdiscountsandcommissions,areapproximately$1.6million.WehaveagreedtoreimbursetheunderwritersfortheirexpensesrelatingtoclearanceofthisofferingwiththeFinancialIndustryRegulatoryAuthority(FINRA)upto$15,000.Theunderwritershaveagreedtoreimburseus,orwillpayandnotseekreimbursementfromus,forcertainexpensesincurredbyusinconnectionwiththisoffering.

Inaddition,inconnectionwithherappointmenttoourboardofdirectors,KimberlyHammonds,whoisaffiliatedwithDeutscheBankSecuritiesInc.,receivedagrantof25,210restrictedstockunits(RSUs).

Theunderwritershaveinformedusthattheydonotintendsalestodiscretionaryaccountstoexceed5%ofthetotalnumberofsharesofcommonstockofferedbythem.

OurcommonstockislistedontheNewYorkStockExchangeunderthetradingsymbol“CLDR.”

Inconnectionwithourinitialpublicoffering,we,allofourdirectorsandofficers,andtheholdersofsubstantiallyallofouroutstandingequitysecuritieshaveagreedthat,subjecttocertainexceptions,withoutthepriorwrittennoticeofMorganStanley&Co.LLConbehalfoftheunderwriters,weandtheywillnotoffer,sell,oragreetosell,transferordisposeof,directlyorindirectly,anysharesofcommonstockwithoutthepermissionofMorganStanley&Co.LLCuntilOctober25,2017.MorganStanley&Co.LLC,onbehalfoftheunderwriters,hasconsentedtothereleaseoftheselock-uprestrictionswithrespectto12,446,930sharesof common stock to be sold by the selling stockholders (including 2,014,816shares of common stock that may be sold by certain selling stockholders uponexerciseoftheunderwriters’optiontopurchaseadditionalshares),including7,116,150sharesbeneficiallyownedbyourdirectorsandexecutiveofficersortheiraffiliatedentities.Thereleasewilltakeeffectonthepricingofthisoffering.

Inaddition,inconnectionwiththisoffering,we,alldirectorsandexecutiveofficers,thesellingstockholdersandcertainotherholdersofourcommonstock,includingAccel,whichasofAugust31,2017beneficiallyowned18,409,144sharesofourcommonstock,GreylockPartners,whichasofAugust31,2017beneficiallyowned14,199,711sharesofourcommonstock,andIntel,whichasofAugust31,2017beneficiallyowned26,065,827sharesofourcommonstock,agreedthat,withoutthepriorwrittenconsentofMorganStanley&Co.LLConbehalfoftheunderwritersandsubjecttocertainexceptions,weandtheywillnotoffer,sell,oragreetosell,directlyorindirectly,anysharesofcommonstockuntil(i)withrespecttoalldirectors,IntelandthesellingstockholdersexceptAccelandGreylock,thecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017,and(ii)withrespecttoourexecutiveofficersandAccelandGreylock,withrespecttothenumberofsharesofcommonstockequaltofiftypercentofthecommonstockheldbythemimmediatelybeforetheconsummationofthepublicoffering,lessanysharessoldinthisoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedOctober31,2017andwithrespecttotheremainingfiftypercentofthecommonstockheldbythemimmediatelybeforetheconsummationofthepublicoffering,afterthecloseoftradingonthesecondfulltradingdayfollowingthepublicreleaseofourearningsforthequarterlyperiodendedJanuary31,2018,thedateortherestrictedperiod:

• offer,pledge,sell,contracttosell,sellanyoptionorcontracttopurchase,purchaseanyoptionorcontracttosell,grantanyoption,rightorwarranttopurchase,lendorotherwisetransferordisposeof,directlyor

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indirectly,anysharesofcommonstockoranysecuritiesconvertibleintoorexercisableorexchangeableforsharesofcommonstock;

• fileanyregistrationstatementwiththeSecuritiesandExchangeCommissionrelatingtotheofferingofanysharesofcommonstockoranysecuritiesconvertibleintoorexercisableorexchangeableforcommonstock;or

• enterintoanyswaporotherarrangementthattransferstoanother,inwholeorinpart,anyoftheeconomicconsequencesofownershipofthecommonstock;whetheranysuchtransactiondescribedaboveistobesettledbydeliveryofcommonstockorsuchothersecurities,incashorotherwise.Inaddition,weandeachsuchpersonagreesthat,withoutthepriorwrittenconsentofMorganStanley&Co.LLC,onbehalfoftheunderwriters,weorsuchotherpersonwillnot,duringtherestrictedperiod,makeanydemandfor,orexerciseanyrightwithrespectto,theregistrationofanysharesofcommonstockoranysecurityconvertibleintoorexercisableorexchangeableforcommonstock.

Therestrictionsintheimmediatelyprecedingparagraphdonotapplyto:

• transactionsbyasecurityholderrelatingtosharesofcommonstockorothersecuritiesacquiredinopenmarkettransactionsafterthecompletionoftheofferingoftheshares,providedthatnofilingunderSection16(a)oftheSecuritiesExchangeActof1934,ortheExchangeAct,isrequiredorvoluntarilymadeinconnectionwithsubsequentsalesofcommonstockorothersecuritiesacquiredinsuchopenmarkettransactions;

• thesaleofsharesofcommonstockpursuanttotheunderwritingagreement;

• transfersofsharesofcommonstockoranysecuritiesconvertibleintoorexercisableorexchangeableforcommonstockbyasecurityholder(i)asabonafidegift,orgifts,orforbonafideestateplanningpurposes,(ii)bywillorintestacyor(iii)toanimmediatefamilymemberoratrustforthedirectorindirectbenefitofthesecurityholder;

• transfersordistributionsofsharesofcommonstockoranysecuritiesconvertibleintoorexercisableorexchangeableforcommonstockbya(i)securityholderthatisacorporation,partnership,limitedliabilitycompanyorotherbusinessentity(A)toanothercorporation,partnership,limitedliabilitycompanyorotherbusinessentitythatcontrols,iscontrolledbyormanagedbyorisundercommoncontrolwithsuchsecurityholderor(B)aspartofadistributiontoanequityholderofsuchsecurityholder;

• theexerciseorsettlementofoptionsorrestrictedstockunits(RSUs)grantedunderastockincentiveplanorotherequityawardplandescribedinthisprospectus,ineachcasebyasecurityholderprovidedthatthesharesofcommonstockdelivereduponsuchexercisearesubjecttotherestrictionssetforthaboveandnofilingunderSection16(a)oftheExchangeActisrequiredorvoluntarilymadeinconnectionwithsuchexerciseorsettlementwithinsixtydaysafterthedateofthisprospectus,andaftersuchsixtiethday,anyfilingunderSection16(a)oftheExchangeActshallclearlyindicateinthefootnotestheretothat(i)thefilingrelatestotheexerciseorsettlementofoptionsorRSUsgrantedunderastockincentiveplanorotherequityawardplan,(ii)nosharesweresoldbythereportingpersonand(iii)thesharesreceiveduponexerciseorsettlementoftheoptionorRSUorexerciseofwarrantsaresubjecttotherestrictionssetforthabove;

• thetransferordispositionbyasecurityholderofsharesofcommonstockoranysecuritiesconvertibleintocommonstockbyasecurityholdertousuponavestingorsettlementeventofoursecuritiesorupontheexerciseofoptions,RSUsorwarrantstopurchaseoursecurities,ineachcaseona“cashlessexercise”or“netexercise”basistotheextentpermittedbytheinstrumentsrepresentingsuchoptions,RSUsorwarrantssolongassuch“cashlessexercise”or“netexercise”iseffectedsolelybythesurrenderofoutstandingoptions,RSUsorwarrantstousandourcancellationofalloraportionthereoftopaytheexercisepriceand/orwithholdingtaxandremittanceobligations,providednofilingunderSection16(a)oftheExchangeActisrequiredorvoluntarilymadeinconnectionwithsuchtransferordispositionwithinsixtydaysafterthedateofthisprospectus,andaftersuchsixtiethday,anyfilingunderSection16(a)oftheExchangeAct

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shallclearlyindicateinthefootnotestheretothat(i)thefilingrelatestothetransferordispositiondescribedinthisparagraphand(ii)nosharesweresoldbythereportingperson;

• theexerciseofwarrantsoutstandingdescribedinthisprospectus,providedthatthesharesofcommonstockdelivereduponsuchexercisearesubjecttotherestrictionssetforthaboveandnofilingunderSection16(a)oftheExchangeActisrequiredorvoluntarilymadeduringtheapplicablerestrictedperiod;

• theestablishmentofatradingplanpursuanttoRule10b5-1undertheExchangeActforthetransferofsharesofcommonstock,providedthatsuchplandoesnotprovideforthetransferofcommonstockduringtherestrictedperiodundertheagreementandnopublicannouncementorfilingundertheExchangeActregardingtheestablishmentofsuchplanshallberequiredoforvoluntarilymadebyoronbehalfofthesecurityholderorusandthesaleofsharesofcommonstockpursuanttoa10b5-1tradingplan,provided thatsuchplanwasestablishedpriortotheexecutionofthelock-upagreementbythestockholderandthatanyfilingunderSection16(a)oftheExchangeActthatismadeinconnectionwithanysuchsalesduringtherestrictedperiodshallstatethatsuchsaleshavebeenexecutedundera10b5-1tradingplanandshallalsostatethedatesuchplanwasadopted;

• transfersofsharesofcommonstockoranysecuritiesconvertibleintoorexercisableorexchangeableforcommonstocktoaspouse,formerspouse,partner,formerpartner,child,otherdependent,orsimilarpersonthatoccurspursuanttoasettlementagreementnotinvolvingadispositionforvalue,relatedtothedistributionofassetsinconnectionwiththedissolutionofamarriageorcivilunion,byoperationoflawpursuanttoaqualifieddomesticorderinconnectionwithadivorceorotherdomesticsettlementorpursuanttoanyothercourtorderprovidedthatthesharesofcommonstockdelivereduponsuchtransferaresubjecttotherestrictionssetforthaboveandnofilingunderSection16(a)oftheExchangeActisrequiredorvoluntarilymadeduringtheapplicablerestrictedperiodunlesssuchfilingclearlyindicatesinthefootnotestheretothatsuchtransferoccurredbyoperationoflawandpursuanttoaqualifieddomesticorderorinconnectionwithadivorcesettlement;

• thetransferbyasecurityholderofsharesofourcommonstockoranysecurityconvertibleintoorexercisableorexchangeableforcommonstocktous,pursuanttoagreementsunderwhichwehavetheoptiontorepurchasesuchshares;and

• thetransferbyasecurityholderofsharesofourcommonstockoranysecurityconvertibleintoorexercisableorexchangeableforcommonstockpursuanttoabonafidethirdpartytenderoffer,merger,consolidationorothersimilartransactionmadetoallholdersofthecommonstockinvolvingachangeofcontrolofus,providedthatsuchtransactionhasbeenapprovedbyourboardofdirectorsandprovidedfurtherthatifthetenderoffer,merger,consolidationorothersuchtransactionisnotcompleted,thecommonstockownedbythesecurityholdershallremainsubjecttotherestrictionssetforthabove;provided thatinthecaseofanytransferordistributionpursuanttothethirdandfourthbulletsabove,itshallbeaconditionofthetransferordistributionthateachtransferee,doneeordistributeeshallsignanddeliveracopyofthelock‑upagreementpriortooruponsuchtransferandnofilingunderSection16(a)oftheExchangeAct(otherthan,inthecaseofthethirdbulletabove,aForm5)reportingareductioninbeneficialownershipofsharesofcommonstockshallberequiredorshallbemadevoluntarilyduringtheapplicablerestrictedperiod.

MorganStanley&Co.LLC,initssolediscretion,mayreleasethecommonstockandothersecuritiessubjecttothelock‑upagreementsdescribedaboveinwholeorinpartatanytime,withorwithoutnotice,providedthat,whenandasrequiredbyFINRARule5131,atleasttwobusinessdaysbeforethereleaseorwaiverofanylock-upenteredintoinconnectionwithourinitialpublicoffering,MorganStanley&Co.LLCwillnotifyusoftheimpendingreleaseorwaiverandannouncetheimpendingreleaseorwaiverthroughamajornewsservice,exceptwherethereleaseorwaiveriseffectedsolelytopermitatransferofsecuritiesthatisnotforconsiderationandwherethetransfereehasagreedinwritingtobeboundbythesamelock-upagreementtermsinplaceforthetransferor.

Inordertofacilitatetheofferingofthecommonstock,theunderwritersmayengageintransactionsthatstabilize,maintainorotherwiseaffectthepriceofthecommonstock.Specifically,theunderwritersmaysellmoresharesthantheyareobligatedtopurchaseundertheunderwritingagreement,creatingashortposition.Ashortsaleis

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coverediftheshortpositionisnogreaterthanthenumberofsharesavailableforpurchasebytheunderwritersundertheiroptiontopurchaseadditionalsharesdescribedabove.Theunderwriterscancloseoutacoveredshortsalebyexercisingtheoptiontopurchaseadditionalsharesorpurchasingsharesintheopenmarket.Indeterminingthesourceofsharestocloseoutacoveredshortsale,theunderwriterswillconsider,amongotherthings,theopenmarketpriceofsharescomparedtothepriceavailableundertheoptiontopurchaseadditionalsharesofcommonstock.Theunderwritersmayalsosellsharesinexcessoftheiroptiontopurchaseadditionalsharesofcommonstock,creatinganakedshortposition.Theunderwritersmustcloseoutanynakedshortpositionbypurchasingsharesintheopenmarket.Anakedshortpositionismorelikelytobecreatediftheunderwritersareconcernedthattheremaybedownwardpressureonthepriceofthecommonstockintheopenmarketafterpricingthatcouldadverselyaffectinvestorswhopurchasesharesofcommonstockinthisoffering.Asanadditionalmeansoffacilitatingthisoffering,theunderwritersmaybidfor,andpurchase,sharesofcommonstockintheopenmarkettostabilizethepriceofthecommonstock.Theseactivitiesmayraiseormaintainthemarketpriceofthecommonstockaboveindependentmarketlevelsorpreventorretardadeclineinthemarketpriceofthecommonstock.Theunderwritersarenotrequiredtoengageintheseactivitiesandmayendanyoftheseactivitiesatanytime.

We,thesellingstockholdersandtheunderwritershaveagreedtoindemnifyeachotheragainstcertainliabilities,includingliabilitiesundertheSecuritiesAct.

Aprospectusinelectronicformatmaybemadeavailableonwebsitesmaintainedbyoneormoreunderwriters,orsellinggroupmembers,ifany,participatinginthisoffering.Therepresentativesmayagreetoallocateanumberofsharesofcommonstocktounderwritersforsaletotheironlinebrokerageaccountholders.InternetdistributionswillbeallocatedbytherepresentativestounderwritersthatmaymakeInternetdistributionsonthesamebasisasotherallocations.

Theunderwritersandtheirrespectiveaffiliatesarefullservicefinancialinstitutionsengagedinvariousactivities,whichmayincludesecuritiestrading,commercialandinvestmentbanking,financialadvisory,investmentmanagement,investmentresearch,principalinvestment,hedging,financingandbrokerageactivities.Certainoftheunderwritersandtheirrespectiveaffiliateshave,fromtimetotime,performed,andmayinthefutureperform,variousfinancialadvisoryandinvestmentbankingservicesforus,forwhichtheyreceivedorwillreceivecustomaryfeesandexpenses.Alloftheunderwritersinthisofferingwereunderwritersinourinitialpublicoffering.

Inaddition,intheordinarycourseoftheirvariousbusinessactivities,theunderwritersandtheirrespectiveaffiliatesmaymakeorholdabroadarrayofinvestmentsandactivelytradedebtandequitysecurities(orrelatedderivativesecurities)andfinancialinstruments(includingbankloans)fortheirownaccountandfortheaccountsoftheircustomersandmayatanytimeholdlongandshortpositionsinsuchsecuritiesandinstruments.Suchinvestmentandsecuritiesactivitiesmayinvolveoursecuritiesandinstruments.Theunderwritersandtheirrespectiveaffiliatesmayalsomakeinvestmentrecommendationsorpublishorexpressindependentresearchviewsinrespectofsuchsecuritiesorinstrumentsandmayatanytimehold,orrecommendtoclientsthattheyacquire,longorshortpositionsinsuchsecuritiesandinstruments.

Intheordinarycourseofbusiness,wesold,andmayinthefuturesell,solutionstooneormoreoftheunderwritersortheirrespectiveaffiliatesinarms‑lengthtransactionsonmarketcompetitiveterms.

Selling Restrictions

European Economic Area

InrelationtoeachMemberStateoftheEuropeanEconomicAreawhichhasimplementedtheProspectusDirective,eachaRelevantMemberState,anoffertothepublicofanysharesofourcommonstockmaynotbemadeinthatRelevantMemberState,exceptthatanoffertothepublicinthatRelevantMemberStateofanysharesofourcommonstockmaybemadeatanytimeunderthefollowingexemptionsundertheProspectusDirective,iftheyhavebeenimplementedinthatRelevantMemberState:

(a) toanylegalentitywhichisaqualifiedinvestorasdefinedintheProspectusDirective;

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(b) tofewerthan100or,iftheRelevantMemberStatehasimplementedtherelevantprovisionofthe2010PDAmendingDirective,150,naturalorlegalpersons(otherthanqualifiedinvestorsasdefinedintheProspectusDirective),aspermittedundertheProspectusDirective,subjecttoobtainingthepriorconsentoftherepresentativesforanysuchoffer;or

(c) inanyothercircumstancesfallingwithinArticle3(2)oftheProspectusDirective,providedthatnosuchofferofsharesofourcommonstockshallresultinarequirementforthepublicationbyusoranyunderwriterofaprospectuspursuanttoArticle3oftheProspectusDirective.

Forthepurposesofthisprovision,theexpressionan“offertothepublic”inrelationtoanysharesofourcommonstockinanyRelevantMemberStatemeansthecommunicationinanyformandbyanymeansofsufficientinformationonthetermsoftheofferandanysharesofourcommonstocktobeofferedsoastoenableaninvestortodecidetopurchaseanysharesofourcommonstock,asthesamemaybevariedinthatMemberStatebyanymeasureimplementingtheProspectusDirectiveinthatMemberState,theexpression“ProspectusDirective”meansDirective2003/71/EC(andamendmentsthereto,includingthe2010PDAmendingDirective,totheextentimplementedintheRelevantMemberState),andincludesanyrelevantimplementingmeasureintheRelevantMemberState,andtheexpression“2010PDAmendingDirective”meansDirective2010/73/EU.

United Kingdom

Eachunderwriterhasrepresentedandagreedthat:

(a) ithasonlycommunicatedorcausedtobecommunicatedandwillonlycommunicateorcausetobecommunicatedaninvitationorinducementtoengageininvestmentactivity(withinthemeaningofSection21oftheFinancialServicesandMarketsAct2000(FSMA)receivedbyitinconnectionwiththeissueorsaleofthesharesofourcommonstockincircumstancesinwhichSection21(1)oftheFSMAdoesnotapplytous;and

(b) ithascompliedandwillcomplywithallapplicableprovisionsoftheFSMAwithrespecttoanythingdonebyitinrelationtothesharesofourcommonstockin,fromorotherwiseinvolvingtheUnitedKingdom.

Canada

Thesharesofcommonstockmaybesoldonlytopurchaserspurchasing,ordeemedtobepurchasing,asprincipalthatareaccreditedinvestors,asdefinedinNationalInstrument45-106Prospectus Exemptions orsubsection73.3(1)oftheSecurities Act (Ontario),andarepermittedclients,asdefinedinNationalInstrument31-103Registration Requirements, Exemptions and Ongoing Registrant Obligations .Anyresaleofthesharesofcommonstockmustbemadeinaccordancewithanexemptionfrom,orinatransactionnotsubjectto,theprospectusrequirementsofapplicablesecuritieslaws.

SecuritieslegislationincertainprovincesorterritoriesofCanadamayprovideapurchaserwithremediesforrescissionordamagesifthisprospectus(includinganyamendmentthereto)containsamisrepresentation,providedthattheremediesforrescissionordamagesareexercisedbythepurchaserwithinthetimelimitprescribedbythesecuritieslegislationofthepurchaser’sprovinceorterritory.Thepurchasershouldrefertoanyapplicableprovisionsofthesecuritieslegislationofthepurchaser’sprovinceorterritoryforparticularsoftheserightsorconsultwithalegaladvisor.

Pursuanttosection3A.3(or,inthecaseofsecuritiesissuedorguaranteedbythegovernmentofanon-Canadianjurisdiction,section3A.4)ofNationalInstrument33-105Underwriting Conflicts (NI33-105),theunderwritersarenotrequiredtocomplywiththedisclosurerequirementsofNI33-105regardingunderwriterconflictsofinterestinconnectionwiththisoffering.

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Hong Kong

ThesharesofcommonstockhavenotbeenofferedorsoldandwillnotbeofferedorsoldinHongKong,bymeansofanydocument,otherthan(a)to“professionalinvestors”asdefinedintheSecuritiesandFuturesOrdinance(Cap.571)ofHongKongandanyrulesmadeunderthatOrdinance;or(b)inothercircumstanceswhichdonotresultinthedocumentbeinga“prospectus”asdefinedintheCompanies(WindingUpandMiscellaneousProvisions)Ordinance(Cap.32)ofHongKongorwhichdonotconstituteanoffertothepublicwithinthemeaningofthatOrdinance.Noadvertisement,invitationordocumentrelatingtothesharesofcommonstockhasbeenormaybeissuedorhasbeenormaybeinthepossessionofanypersonforthepurposesofissuance,whetherinHongKongorelsewhere,whichisdirectedat,orthecontentsofwhicharelikelytobeaccessedorreadby,thepublicofHongKong(exceptifpermittedtodosounderthesecuritieslawsofHongKong)otherthanwithrespecttosharesofcommonstockwhichareorareintendedtobedisposedofonlytopersonsoutsideHongKongoronlyto“professionalinvestors”asdefinedintheSecuritiesandFuturesOrdinanceandanyrulesmadeunderthatOrdinance.

Singapore

ThisprospectushasnotbeenregisteredasaprospectuswiththeMonetaryAuthorityofSingapore.Accordingly,thisprospectusandanyotherdocumentormaterialinconnectionwiththeofferorsale,orinvitationforsubscriptionorpurchase,ofthesharesofcommonstockmaynotbecirculatedordistributed,normaythesharesofcommonstockbeofferedorsold,orbemadethesubjectofaninvitationforsubscriptionorpurchase,whetherdirectlyorindirectly,topersonsinSingaporeotherthan(i)toaninstitutionalinvestorunderSection274oftheSecuritiesandFuturesAct,Chapter289ofSingapore,ortheSFA,(ii)toarelevantpersonpursuanttoSection275(1),oranypersonpursuanttoSection275(1A),andinaccordancewiththeconditionsspecifiedinSection275,oftheSFA,or(iii)otherwisepursuantto,andinaccordancewiththeconditionsof,anyotherapplicableprovisionoftheSFA.

WherethesharesofcommonstockaresubscribedorpurchasedunderSection275oftheSFAbyarelevantpersonwhichis:

(a) acorporation(whichisnotanaccreditedinvestor(asdefinedinSection4AoftheSFA))thesolebusinessofwhichistoholdinvestmentsandtheentiresharecapitalofwhichisownedbyoneormoreindividuals,eachofwhomisanaccreditedinvestor;or

(b) atrust(wherethetrusteeisnotanaccreditedinvestor)thesolepurposeofwhichistoholdinvestmentsandeachbeneficiaryofthetrustisanindividualwhoisanaccreditedinvestor,securities(asdefinedinSection239(1)oftheSFA)ofthatcorporationorthebeneficiaries’rightsandinterest(howsoeverdescribed)inthattrustshallnotbetransferredwithinsixmonthsafterthatcorporationorthattrusthasacquiredthesharesofcommonstockpursuanttoanoffermadeunderSection275oftheSFAexcept:

(a) toaninstitutionalinvestorortoarelevantpersondefinedinSection275(2)oftheSFA,ortoanypersonarisingfromanofferreferredtoinSection275(1A)orSection276(4)(i)(B)oftheSFA;

(b) wherenoconsiderationisorwillbegivenforthetransfer;

(c) wherethetransferisbyoperationoflaw;

(d) asspecifiedinSection276(7)oftheSFA;or

(e) asspecifiedinRegulation32oftheSecuritiesandFutures(OffersofInvestments)(SharesandDebentures)Regulations2005ofSingapore.

Japan

NoregistrationpursuanttoArticle4,paragraph1oftheFinancialInstrumentsandExchangeLawofJapan(LawNo.25of1948,asamended),ortheFIEL,hasbeenmadeorwillbemadewithrespecttothesolicitationoftheapplicationfortheacquisitionofthesharesofcommonstock.

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Accordingly,thesharesofcommonstockhavenotbeen,directlyorindirectly,offeredorsoldandwillnotbe,directlyorindirectly,offeredorsoldinJapanorto,orforthebenefitof,anyresidentofJapan(whichtermasusedhereinmeansanypersonresidentinJapan,includinganycorporationorotherentityorganizedunderthelawsofJapan)ortoothersforre-offeringorre-sale,directlyorindirectly,inJapanorto,orforthebenefitof,anyresidentofJapanexceptpursuanttoanexemptionfromtheregistrationrequirements,andotherwiseincompliancewith,theFIELandtheotherapplicablelawsandregulationsofJapan.

For Qualified Institutional Investors, or QII

Pleasenotethatthesolicitationfornewly-issuedorsecondarysecurities(eachasdescribedinParagraph2,Article4oftheFIEL)inrelationtothesharesofcommonstockconstituteseithera“QIIonlyprivateplacement”ora“QIIonlysecondarydistribution”(eachasdescribedinParagraph1,Article23-13oftheFIEL).Disclosureregardinganysuchsolicitation,asisotherwiseprescribedinParagraph1,Article4oftheFIEL,hasnotbeenmadeinrelationtothesharesofcommonstock.ThesharesofcommonstockmayonlybetransferredtoQIIs.

For Non-QII Investors

Pleasenotethatthesolicitationfornewly-issuedorsecondarysecurities(eachasdescribedinParagraph2,Article4oftheFIEL)inrelationtothesharesofcommonstockconstituteseithera“smallnumberprivateplacement”ora“smallnumberprivatesecondarydistribution”(eachasisdescribedinParagraph4,Article23-13oftheFIEL).Disclosureregardinganysuchsolicitation,asisotherwiseprescribedinParagraph1,Article4oftheFIEL,hasnotbeenmadeinrelationtothesharesofcommonstock.Thesharesofcommonstockmayonlybetransferredenblocwithoutsubdivisiontoasingleinvestor.

Australia

Noplacementdocument,prospectus,productdisclosurestatementorotherdisclosuredocumenthasbeenlodgedwiththeAustralianSecuritiesandInvestmentsCommission,orASIC,inrelationtotheoffering.Thisprospectusdoesnotconstituteaprospectus,productdisclosurestatementorotherdisclosuredocumentundertheCorporationsAct2001,ortheCorporationsAct,anddoesnotpurporttoincludetheinformationrequiredforaprospectus,productdisclosurestatementorotherdisclosuredocumentundertheCorporationsAct.

AnyofferinAustraliaofthesharesmayonlybemadetopersons,ortheExemptInvestors,whoare“sophisticatedinvestors”(withinthemeaningofsection708(8)oftheCorporationsAct),“professionalinvestors”(withinthemeaningofsection708(11)oftheCorporationsAct)orotherwisepursuanttooneormoreexemptionscontainedinsection708oftheCorporationsActsothatitislawfultooffertheshareswithoutdisclosuretoinvestorsunderChapter6DoftheCorporationsAct.

ThesharesappliedforbyExemptInvestorsinAustraliamustnotbeofferedforsaleinAustraliaintheperiodof12monthsafterthedateofallotmentundertheoffering,exceptincircumstanceswheredisclosuretoinvestorsunderChapter6DoftheCorporationsActwouldnotberequiredpursuanttoanexemptionundersection708oftheCorporationsActorotherwiseorwheretheofferispursuanttoadisclosuredocumentwhichcomplieswithChapter6DoftheCorporationsAct.AnypersonacquiringsharesmustobservesuchAustralianon-salerestrictions.

Thisprospectuscontainsgeneralinformationonlyanddoesnottakeintoaccounttheinvestmentobjectives,financialsituationorparticularneedsofanyparticularperson.Itdoesnotcontainanysecuritiesrecommendationsorfinancialproductadvice.Beforemakinganinvestmentdecision,investorsneedtoconsiderwhethertheinformationinthisprospectusisappropriatefortheirneeds,objectivesandcircumstances,and,ifnecessary,seekexpertadviceonthosematters.

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Dubai International Financial Centre

ThisprospectusrelatestoanExemptOfferinaccordancewiththeOfferedSecuritiesRulesoftheDubaiFinancialServicesAuthority,orDFSA.ThisprospectusisintendedfordistributiononlytopersonsofatypespecifiedintheOfferedSecuritiesRulesoftheDFSA.Itmustnotbedeliveredto,orreliedonby,anyotherperson.TheDFSAhasnoresponsibilityforreviewingorverifyinganydocumentsinconnectionwithExemptOffers.TheDFSAhasnotapprovedthisprospectusnortakenstepstoverifytheinformationsetforthhereinandhasnoresponsibilityfortheprospectus.Thesharestowhichthisprospectusrelatesmaybeilliquidand/orsubjecttorestrictionsontheirresale.Prospectivepurchasersofthesharesofferedshouldconducttheirownduediligenceontheshares.Ifyoudonotunderstandthecontentsofthisprospectusyoushouldconsultanauthorizedfinancialadvisor.

Switzerland

ThesharesofcommonstockmaynotbepubliclyofferedinSwitzerlandandwillnotbelistedontheSIXSwissExchange,orSIX,oronanyotherstockexchangeorregulatedtradingfacilityinSwitzerland.

Thisdocumenthasbeenpreparedwithoutregardtothedisclosurestandardsforissuanceprospectusesunderart.652aorart.1156oftheSwissCodeofObligationsorthedisclosurestandardsforlistingprospectusesunderart.27ff.oftheSIXListingRulesorthelistingrulesofanyotherstockexchangeorregulatedtradingfacilityinSwitzerland.NeitherthisdocumentnoranyotherofferingormarketingmaterialrelatingtothesharesortheofferingmaybepubliclydistributedorotherwisemadepubliclyavailableinSwitzerland.Neitherthisdocumentnoranyotherofferingormarketingmaterialrelatingtotheoffering,us,ortheshareshavebeenorwillbefiledwithorapprovedbyanySwissregulatoryauthority.Inparticular,thisdocumentwillnotbefiledwith,andtheofferofshareswillnotbesupervisedby,theSwissFinancialMarketSupervisoryAuthorityFINMA,orFINMA,andtheofferofshareshasnotbeenandwillnotbeauthorizedundertheSwissFederalActonCollectiveInvestmentSchemes,orCISA.TheinvestorprotectionaffordedtoacquirersofinterestsincollectiveinvestmentschemesundertheCISAdoesnotextendtoacquirersofshares.

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LEGAL MATTERS

Fenwick&WestLLP,MountainView,Californiawillpassuponthevalidityoftheissuanceofthesharesofcommonstockofferedbythisprospectus.GundersonDettmerStoughVilleneuveFranklin&Hachigian,LLP,RedwoodCity,California,isrepresentingtheunderwritersinthisoffering.

EXPERTS

Ernst&YoungLLP,independentregisteredpublicaccountingfirm,hasauditedourconsolidatedfinancialstatementsatJanuary31,2016and2017,andfortheyearsthenended,assetforthintheirreport.WehaveincludedourfinancialstatementsintheprospectusandelsewhereintheregistrationstatementinrelianceonErnst&YoungLLP’sreport,givenontheirauthorityasexpertsinaccountingandauditing.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

WehavefiledwiththeSECaregistrationstatementonFormS‑1undertheSecuritiesActwithrespecttothesharesofcommonstockofferedhereby.Thisprospectus,whichconstitutesapartoftheregistrationstatement,doesnotcontainalloftheinformationsetforthintheregistrationstatement,someitemsofwhicharecontainedinexhibitstotheregistrationstatementaspermittedbytherulesandregulationsoftheSEC.Forfurtherinformationwithrespecttousandourcommonstock,wereferyoutotheregistrationstatement,includingtheexhibitsandtheconsolidatedfinancialstatementsandnotesfiledasapartoftheregistrationstatement.Statementscontainedinthisprospectusconcerningthecontentsofanycontractoranyotherdocumentarenotnecessarilycomplete.Ifacontractordocumenthasbeenfiledasanexhibittotheregistrationstatement,pleaseseethecopyofthecontractordocumentthathasbeenfiled.Eachstatementinthisprospectusrelatingtoacontractordocumentfiledasanexhibitisqualifiedinallrespectsbythefiledexhibit.Theexhibitstotheregistrationstatementshouldbereviewedforthecompletecontentsofthesecontractsanddocuments.Acopyoftheregistrationstatement,includingtheexhibitsandthefinancialstatementsandnotesfiledasapartoftheregistrationstatement,maybeinspectedwithoutchargeattheSEC’sPublicReferenceRoomat100FStreet,N.E.,Washington,D.C.20549,andcopiesofalloranypartoftheregistrationstatementmaybeobtainedfromtheSECuponthepaymentoffeesprescribedbyit.YoumaycalltheSECat1‑800‑SEC‑0330formoreinformationontheoperationofthepublicreferencefacilities.TheSECmaintainsawebsiteathttp://www.sec.govthatcontainsreports,proxyandinformationstatementsandotherinformationregardingcompaniesthatfileelectronicallywithit.

Asaresultofthisoffering,wewillbecomesubjecttotheinformationandreportingrequirementsoftheExchangeActand,inaccordancewiththislaw,willfileperiodicreports,proxystatementsandotherinformationwiththeSEC.Theseperiodicreports,proxystatementsandotherinformationwillbeavailableforinspectionandcopyingattheSEC’spublicreferencefacilitiesandthewebsiteoftheSECreferredtoabove.

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CLOUDERA, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

PageReportofIndependentRegisteredPublicAccountingFirm F-2ConsolidatedBalanceSheets F-3ConsolidatedStatementsofOperations F-4ConsolidatedStatementsofComprehensiveLoss F-6ConsolidatedStatementsofRedeemableConvertiblePreferredStockandStockholders’Equity(Deficit) F-7ConsolidatedStatementsofCashFlows F-9NotestoConsolidatedFinancialStatements F-11

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TheBoardofDirectorsandStockholdersCloudera,Inc.

WehaveauditedtheaccompanyingconsolidatedbalancesheetsofCloudera,Inc.asofJanuary31,2016and2017,andtherelatedconsolidatedstatementsofoperations,comprehensiveloss,redeemableconvertiblepreferredstockandstockholders’deficitandcashflowsfortheyearsthenended.ThesefinancialstatementsaretheresponsibilityoftheCompany’smanagement.Ourresponsibilityistoexpressanopiniononthesefinancialstatementsbasedonouraudits.

WeconductedourauditsinaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(UnitedStates).Thosestandardsrequirethatweplanandperformtheaudittoobtainreasonableassuranceaboutwhetherthefinancialstatementsarefreeofmaterialmisstatement.WewerenotengagedtoperformanauditoftheCompany’sinternalcontroloverfinancialreporting.Ourauditsincludedconsiderationofinternalcontroloverfinancialreportingasabasisfordesigningauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeofexpressinganopinionontheeffectivenessoftheCompany’sinternalcontroloverfinancialreporting.Accordingly,weexpressnosuchopinion.Anauditalsoincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclosuresinthefinancialstatements,assessingtheaccountingprinciplesusedandsignificantestimatesmadebymanagement,andevaluatingtheoverallfinancialstatementpresentation.Webelievethatourauditsprovideareasonablebasisforouropinion.

Inouropinion,thefinancialstatementsreferredtoabovepresentfairly,inallmaterialrespects,theconsolidatedfinancialpositionofCloudera,Inc.atJanuary31,2016and2017,andtheconsolidatedresultsofitsoperationsanditscashflowsfortheyearsthenended,inconformitywithU.S.generallyacceptedaccountingprinciples.

/s/Ernst&YoungLLP

RedwoodCity,CaliforniaMarch31,2017

F-2

TableofContents

CLOUDERA, INC.

Consolidated Balance Sheets(in thousands, except share and per share data)

As of

January 31, As of

July 31,

2016 2017 2017

(unaudited)

ASSETS CURRENTASSETS:

Cashandcashequivalents $ 35,966 $ 74,186 $ 68,936Short-termmarketablesecurities 216,584 160,770 325,744Accountsreceivable,net 49,410 101,549 84,805Prepaidexpensesandothercurrentassets 8,799 13,197 17,509

Totalcurrentassets 310,759 349,702 496,994Propertyandequipment,net 12,882 13,104 13,027Marketablesecurities,noncurrent 145,695 20,710 81,072Intangibleassets,net 9,036 7,051 5,166Goodwill 30,551 31,516 31,516Restrictedcash 28 15,446 18,048Otherassets 3,936 5,015 3,994

TOTALASSETS $ 512,887 $ 442,544 $ 649,817LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’

EQUITY (DEFICIT) CURRENTLIABILITIES:

Accountspayable $ 4,080 $ 3,550 $ 6,326Accruedcompensation 22,154 33,376 32,254Otheraccruedliabilities 11,173 9,918 15,670Deferredrevenue,currentportion 130,635 192,242 194,252

Totalcurrentliabilities 168,042 239,086 248,502Deferredrevenue,lesscurrentportion 27,540 25,182 36,869Otherliabilities 3,127 4,345 9,058TOTALLIABILITIES 198,709 268,613 294,429Commitmentsandcontingencies(Note7) Redeemableconvertiblepreferredstock,$0.00005parvalue;74,907,415sharesauthorized,issued,andoutstandingatJanuary31,2016and2017;$670,875aggregateliquidationpreferenceatJanuary31,2016and2017;nosharesauthorized,issued,andoutstandingatJuly31,2017(unaudited) 657,687 657,687 —

STOCKHOLDERS’EQUITY(DEFICIT): Preferredstock,$0.00005parvalue;nosharesauthorized,issuedandoutstanding,atJanuary31,2016and2017;20,000,000sharesauthorized,nosharesissuedandoutstandingatJuly31,2017(unaudited) — — —

Commonstock,$0.00005parvalue;150,000,000,160,000,000and1,200,000,000sharesauthorizedatJanuary31,2016and2017andJuly31,2017(unaudited),respectively;35,775,694,38,156,688and131,250,336sharesissuedandoutstandingatJanuary31,2016and2017andJuly31,2017(unaudited),respectively 1 2 7

Additionalpaid-incapital 145,914 192,795 1,318,447Accumulatedothercomprehensiveloss (744) (556) (521)Accumulateddeficit (488,680) (675,997) (962,545)

TOTALSTOCKHOLDERS’EQUITY(DEFICIT) (343,509) (483,756) 355,388TOTALLIABILITIES,REDEEMABLECONVERTIBLEPREFERREDSTOCKANDSTOCKHOLDERS’EQUITY(DEFICIT) $ 512,887 $ 442,544 $ 649,817

Theaccompanyingnotesareanintegralpartoftheseconsolidatedfinancialstatements.

F-3

TableofContents

CLOUDERA, INC.

Consolidated Statements of Operations(in thousands, except per share data)



2016 2017 2016 2017

(unaudited)Revenue:

Subscription $ 119,150 $ 200,252 $ 91,360 $ 138,657Services 46,898 60,774 29,581 30,767

Totalrevenue 166,048 261,026 120,941 169,424Costofrevenue:(1)(2)

Subscription 30,865 38,704 19,057 41,687Services 44,498 48,284 23,317 50,395

Totalcostofrevenue 75,363 86,988 42,374 92,082Grossprofit 90,685 174,038 78,567 77,342Operatingexpenses:(1)(2)(3)

Researchanddevelopment 99,314 102,309 51,150 138,675Salesandmarketing 161,106 203,161 93,044 172,578Generalandadministrative 34,902 55,907 16,676 54,114

Totaloperatingexpenses 295,322 361,377 160,870 365,367Lossfromoperations (204,637) (187,339) (82,303) (288,025)Interestincome,net 2,218 2,756 1,448 2,089Otherincome(expense),net 386 (547) (15) 839Netlossbeforeprovisionforincometaxes (202,033) (185,130) (80,870) (285,097)Provisionforincometaxes (1,110) (2,187) (970) (1,451)

Netlossattributabletocommonstockholders $ (203,143) $ (187,317) $ (81,840) $ (286,548)

Netlosspershareattributabletocommonstockholders,basicanddiluted $ (6.21) $ (5.15) $ (2.27) $ (3.28)Weighted-averagesharesusedincomputingnetlosspershareattributabletocommonstockholders,basicanddiluted 32,724 36,406 36,090 87,293

___________(1) Amountsincludestock‑basedcompensationexpenseasfollows(inthousands):



2016 2017 2016 2017

(unaudited)


Costofrevenue–services 4,301 1,803 931 24,227

Researchanddevelopment 23,048 5,606 3,013 81,029

Salesandmarketing 19,187 5,757 3,033 72,678

Generalandadministrative 13,691 7,122 3,556 33,206


F-4

TableofContents

CLOUDERA, INC.

Consolidated Statements of Operations(in thousands, except per share data)

(2) Amountsincludeamortizationofacquiredintangibleassetsasfollows(inthousands):



2016 2017 2016 2017

(unaudited)


Salesandmarketing 1,723 1,723 861 861

(3) InJanuary2017,wedonated1,175,063sharesofcommonstocktotheClouderaFoundation.Werecordedanon‑cashchargeof$21.6millionforthefairvalueofthedonatedshares,whichwasrecognizedingeneralandadministrativeexpensefortheyearendedJanuary31,2017.SeeNote12forfurtherdiscussion.


F-5

TableofContents

CLOUDERA, INC.

Consolidated Statements of Comprehensive Loss(in thousands)



2016 2017 2016 2017

(unaudited)Netloss $ (203,143) $ (187,317) $ (81,840) $ (286,548)Othercomprehensiveincome(loss),netoftax:

Foreigncurrencytranslationgains(losses) (334) 75 33 (26)Unrealizedgain(loss)oninvestments (187) 113 353 61

Totalothercomprehensiveincome(loss),netoftax (521) 188 386 35

Comprehensiveloss $ (203,664) $ (187,129) $ (81,454) $ (286,513)


F-6

TableofContents

CLOUDERA, INC.

Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)(in thousands, except share data)

Redeemable Convertible

Preferred Stock Common Stock AdditionalPaid-InCapital

AccumulatedOther

ComprehensiveLoss

AccumulatedDeficit

TotalStockholders’

Deficit Shares Amount Shares Amount BalanceasofJanuary31,2015 74,907,415 $ 657,687 28,815,224 $ 1 $ 63,119 $ (223) $ (285,537) $ (222,640)

Stockoptionexercises — — 5,838,389 — 10,865 — — 10,865Vestedrestrictedstockunitsconvertedintoshares — — 799,552 — — — — —

Stock-basedcompensationexpense — — — — 63,590 — — 63,590

Sharesissuedrelatedtobusinesscombination — — 358,735 — 9,542 — — 9,542

Shareswithheldrelatedtonetsharesettlementofrestrictedstock — — (36,206) — (1,202) — — (1,202)

Unrealizedlossoninvestments — — — — — (187) — (187)

Foreigncurrencytranslationadjustment — — — — — (334) — (334)

Netloss — — — — — — (203,143) (203,143)BalanceasofJanuary31,2016 74,907,415 657,687 35,775,694 1 145,914 (744) (488,680) (343,509)Stockoptionexercises — — 1,157,625 1 3,593 — — 3,594Vestedrestrictedstockunitsconvertedintoshares — — 48,306 — — — — —

Stock-basedcompensationexpense — — — — 21,714 — — 21,714

DonationofcommonstocktotheClouderaFoundation — — 1,175,063 — 21,574 — — 21,574

Unrealizedgainoninvestments — — — — — 113 — 113

Foreigncurrencytranslationadjustment — — — — — 75 — 75

Netloss — — — — — — (187,317) (187,317)BalanceasofJanuary31,2017 74,907,415 657,687 38,156,688 2 192,795 (556) (675,997) (483,756)Stockoptionexercises(unaudited) — — 895,118 — 2,072 — — 2,072

Vestedrestrictedstockunitsconvertedintoshares(unaudited) — — 41,115 — — — — —


F-7

TableofContents

CLOUDERA, INC.

Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)(in thousands, except share data)

Conversionofredeemableconvertiblepreferredstocktocommonstockinconnectionwithinitialpublicoffering(unaudited) (74,907,415) (657,687) 74,907,415 4 657,683 — — 657,687

Issuanceofcommonstockinconnectionwithinitialpublicoffering,netofofferingcosts(unaudited) — — 17,250,000 1 235,364 — — 235,365

Stock-basedcompensationexpense(unaudited) — — — — 230,533 — — 230,533

Unrealizedgainoninvestments(unaudited) — — — — — 61 — 61

Foreigncurrencytranslationadjustment(unaudited) — — — — — (26) — (26)

Netloss(unaudited) — — — — — — (286,548) (286,548)BalanceasofJuly31,2017(unaudited) — $ — 131,250,336 $ 7 $ 1,318,447 $ (521) $ (962,545) $ 355,388


F-8

TableofContents

CLOUDERA, INC.

Consolidated Statements of Cash Flows(in thousands)



2016 2017 2016 2017

(unaudited)CASH FLOWS FROM OPERATING ACTIVITIES Netloss $ (203,143) $ (187,317) $ (81,840) $ (286,548)Adjustmentstoreconcilenetlosstonetcashusedinoperatingactivities:

Depreciationandamortization 8,586 10,134 4,953 6,994Stock-basedcompensation 63,590 21,714 11,241 230,533DonationofcommonstocktotheClouderaFoundation — 21,574 — —Accretionandamortizationofmarketablesecurities 3,605 2,867 1,966 414Lossondisposaloffixedassets 3 — — —Changesinassetsandliabilities:

Accountsreceivable (19,015) (52,139) 4,011 16,744Prepaidexpensesandotherassets (1,795) (3,300) (784) 639Accountspayable 1,455 (281) 1,872 1,674Accruedcompensation 9,374 11,222 (3,128) (4,983)Accruedexpensesandotherliabilities 4,757 (284) 1,006 2,970Deferredrevenue 42,086 59,249 8,604 13,697

Netcashusedinoperatingactivities (90,497) (116,561) (52,099) (17,866)CASH FLOWS FROM INVESTING ACTIVITIES

Purchasesofmarketablesecurities (411,524) (103,776) (90,409) (387,154)Salesofmarketablesecurities 71,379 74,655 34,372 43,198Maturitiesofmarketablesecurities 111,913 207,792 129,945 117,604Cashusedinbusinesscombinations,netofcashacquired (8,911) (2,700) (2,700) —Capitalexpenditures (5,539) (7,385) (6,135) (1,971)

Netcashprovidedby(usedin)investingactivities (242,682) 168,586 65,073 (228,323)CASH FLOWS FROM FINANCING ACTIVITIES

Netproceedsfrom(paymentsfor)issuanceofcommonstockininitialpublicoffering — (2,056) — 237,686Shareswithheldrelatedtonetsharesettlementofrestrictedstockunits (1,202) — — —Proceedsfromemployeestockplans 10,865 3,594 1,633 5,932

Netcashprovidedbyfinancingactivities 9,663 1,538 1,633 243,618Effectofexchangeratechanges (334) 75 34 (77)Netincrease(decrease)incash,cashequivalentsandrestrictedcash (323,850) 53,638 14,641 (2,648)Cash,cashequivalentsandrestrictedcash—Beginningofperiod 359,844 35,994 35,994 89,632

Cash,cashequivalentsandrestrictedcash—Endofperiod $ 35,994 $ 89,632 $ 50,635 $ 86,984


F-9

TableofContents

CLOUDERA, INC.

Consolidated Statements of Cash Flows(in thousands)

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cashpaidforincometaxes $ 1,131 $ 1,689 $ 654 $ 1,352

Cashpaidforinterest $ 1 $ 1 — —SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND

FINANCING ACTIVITIES Purchasesofpropertyandequipmentinotheraccruedliabilities $ 793 $ 44 $ 570 $ 3,054

Fairvalueofcommonstockissuedasconsiderationforbusinesscombinations $ 9,542 $ — $ — $ —

Deferredofferingcostsinaccountspayableandotheraccruedliabilities $ — $ 747 $ — $ 264

Conversionofredeemableconvertiblepreferredstocktocommonstock $ — $ — $ — $ 657,687


F-10

TableofContents

CLOUDERA, INC.

Notes to Consolidated Financial Statements(information as of July 31, 2017 and for the six months ended July 31, 2017 and 2016 is unaudited)

1. Organization and Description of Business

Cloudera,Inc.wasincorporatedinthestateofDelawareonJune27,2008andisheadquarteredinPaloAlto,California.Wesellsubscriptionsandservicesforourmachinelearningandanalyticsplatform,optimizedforthecloud.Thisplatformdeliversanintegratedsuiteofcapabilitiesfordatamanagement,machinelearningandadvancedanalytics,affordingcustomersanagile,scalableandcost‑effectivesolutionfortransformingtheirbusinesses.

Unlessthecontextrequiresotherwise,thewords“we,”“us,”“our,”the“Company”and“Cloudera”refertoCloudera,Inc.anditssubsidiariestakenasawhole.

AsofJanuary31,2017andJuly31,2017,wehadanaccumulateddeficittotaling$676.0millionand$962.5million,respectively.Wehavefundedouroperationsprimarilywiththenetproceedswereceivedthroughthesaleofourcommonstockinourinitialpublicoffering(IPO),privatesalesofequitysecuritiesandproceedsfromthesaleofoursubscriptionsandservices.Managementbelievesthatcurrentlyavailableresourceswillbesufficienttofundourcashrequirementsforatleastthenexttwelvemonths.

Initial Public Offering

OnMay3,2017,wecompletedourIPOinwhichweissuedandsold17,250,000sharesofcommonstock,inclusiveoftheunderwriters’over-allotmentoption,atapublicofferingpriceof$15.00pershare.Wereceivednetproceedsof$235.4millionafterdeductingunderwritingdiscountsandcommissionsof$18.1millionandotherissuancecostsof$5.3million.InconjunctionwiththeIPO,wedonated$2.4million,or1%,ofthenetproceeds,tofundtheClouderaFoundation’sactivities.ImmediatelypriortotheclosingoftheIPO,all74,907,415sharesofourthen-outstandingredeemableconvertiblepreferredstockautomaticallyconvertedintosharesofcommonstockandwereclassified$657.7millionfromtemporaryequitytoadditionalpaidincapitalonourconsolidatedbalancesheet.

2. Summary of Significant Accounting Policies

Basis of Consolidation

TheconsolidatedfinancialstatementsincludetheaccountsofCloudera,Inc.anditswhollyownedsubsidiarieswhicharelocatedinvariouscountries,includingtheUnitedStates,Australia,China,Germany,HungaryandtheUnitedKingdom.Allintercompanybalancesandtransactionshavebeeneliminateduponconsolidation.ThefinancialstatementsarepreparedinaccordancewithaccountingprinciplesgenerallyacceptedintheUnitedStates(GAAP).

Fiscal Year

OurfiscalyearendsonJanuary31.Referencestofiscal2017,forexample,referstothefiscalyearendedJanuary31,2017.

Unaudited Interim Financial Information

TheaccompanyinginterimconsolidatedbalancesheetasofJuly31,2017,theinterimconsolidatedstatementsofoperations,comprehensivelossandcashflowsforthesixmonthsendedJuly31,2016and2017andtheinterimconsolidatedstatementofredeemableconvertiblepreferredstockandstockholders’equity(deficit)forthesixmonthsendedJuly31,2017areunaudited.Thefinancialdataandinformationdisclosedinthesenotestotheconsolidatedfinancialstatementsrelatedtothatdateandtheseperiodsarealsounaudited.Theunauditedinterimconsolidatedfinancialstatementshavebeenpreparedonthesamebasisastheannualconsolidatedfinancialstatementsand,intheopinionofmanagement,reflectalladjustments,whichincludeonlynormalrecurringadjustments,necessarytopresentfairlyourfinancialpositionasofJuly31,2017andtheresultsofouroperationsandcashflowsforthesixmonthsendedJuly31,2016and2017.Theconsolidatedresultsofoperationsforthesix

F-11

monthsendedJuly31,2017arenotnecessarilyindicativeoftheresultstobeexpectedfortheentireyearendingJanuary31,2018,orforanyotherfutureannualorinterimperiod.

Use of Estimates

ThepreparationoffinancialstatementsinconformitywithGAAPrequiresmanagementtomakeestimatesandassumptionsthataffecttheamountsreportedinthefinancialstatementsandaccompanyingnotes.Significantitemssubjecttosuchestimatesincluderevenuerecognition,theusefullivesofpropertyandequipmentandintangibleassets,allowancefordoubtfulaccounts,stock‑basedcompensationexpense,annualbonusattainment,self‑insurancecostsincurred,thefairvalueoftangibleandintangibleassetsacquiredandliabilitiesassumedresultingfrombusinesscombinations,thefairvalueofcommonstockpriortoourIPO,theassessmentofelementsinamulti‑elementarrangementandthevaluationassignedtoeachelement,andcontingencies.Theseestimatesandassumptionsarebasedonmanagement’sbestestimatesandjudgment.Managementregularlyevaluatesitsestimatesandassumptionsusinghistoricalexperienceandotherfactors;however,actualresultscoulddiffersignificantlyfromtheseestimates.

Segments

Weoperateastwooperatingsegments–subscriptionandservices.Operatingsegmentsaredefinedascomponentsofanenterpriseforwhichseparatefinancialinformationisevaluatedregularlybythechiefoperatingdecisionmaker,whoisourchiefexecutiveofficer,indecidinghowtoallocateresourcesandassessperformance.

Foreign Currency Translation

Thefunctionalcurrencyofourforeignsubsidiariesisthelocalcurrency.Thegainsandlossesresultingfromtranslatingourforeignsubsidiaries’financialstatementsintoU.S.dollarshavebeenreportedinaccumulatedothercomprehensivelossontheconsolidatedbalancesheet.Assetsandliabilitiesaretranslatedatexchangeratesineffectatthebalancesheetdate.Equityistranslatedatthehistoricalratesfromtheoriginaltransactionperiod.Revenueandexpensesaretranslatedataverageexchangeratesineffectduringtheperiod.Foreigncurrencytransactiongainsandlossesareincludedinotherincome,netonthestatementofoperations.

Cash, Cash Equivalents and Restricted Cash

Cashequivalentsconsistofshort-term,highlyliquidinvestmentswithoriginalmaturitiesofthreemonthsorlessfromthedateofpurchase.Restrictedcashrepresentscashondepositwithfinancialinstitutionsinsupportoflettersofcreditoutstandinginfavorofcertainlandlordsforofficespace,whichincludes$14.7millioninrestrictedcashrelatedtoanewnon‑cancelableoperatingleaseagreementtorentofficespaceinPaloAlto,CaliforniathatwasenteredintoinSeptember2016.

Cashasreportedontheconsolidatedstatementsofcashflowsincludestheaggregateamountsofcashandcashequivalentsandtherestrictedcashasshownontheconsolidatedbalancesheets.Cashasreportedontheconsolidatedstatementsofcashflowsconsistsofthefollowing(inthousands):

As of

January 31, As of

July 31,

2016 2017 2016 2017

(unaudited)Cashandcashequivalents $ 35,966 $ 74,186 $ 50,609 $ 68,936Restrictedcash 28 15,446 26 18,048

Cash,cashequivalentsandrestrictedcash $ 35,994 $ 89,632 $ 50,635 $ 86,984

Marketable Securities

Wehaveinvestmentsinvariousmarketablesecuritieswhichareclassifiedasavailableforsale.Wedeterminetheappropriateclassificationofmarketablesecuritiesatthetimeofpurchaseandreevaluatesuchdeterminationateachbalancesheetdate.Theinvestmentsareadjustedforamortizationofpremiumsanddiscountstomaturityand

F-12

suchamortizationisincludedininterestincome,netonthestatementofoperations.Changesinmarketvalueconsideredtobetemporaryarerecordedasunrealizedgainsorlossesinothercomprehensiveloss.Realizedgainsandlossesanddeclinesinvaluejudgedtobeotherthantemporaryonavailable‑for‑salesecuritiesareincludedinotherincome(expense),netonthestatementofoperations.Thecostofsecuritiessoldisbasedonthespecific‑identificationmethod.

Strategic Investments

Weowninterestsinnon‑marketableequityanddebtsecurities,whichconsistofminorityequityanddebtinvestmentsinprivately‑heldcompanies.Wereporttheseinvestmentsatcostormarkeddowntofairvaluewhenaneventorcircumstanceindicatesanother‑than‑temporarydeclineinvaluehasoccurred.Theseinvestmentsarevaluedusingsignificantunobservableinputsordatainaninactivemarketwhichrequiresjudgmentduetotheabsenceofmarketpricesandinherentlackofliquidity.

Concentration of Credit Risk and Significant Customers

Financialinstrumentsthatsubjectustoconcentrationsofcreditriskconsistprimarilyofcashandcashequivalents,marketablesecurities,restrictedcash,andaccountsreceivable.Ourcashisdepositedwithhighcreditqualityfinancialinstitutions.AttimessuchdepositsmaybeinexcessoftheFederalDepositoryInsuranceCorporationinsuredlimits.Wehavenotexperiencedanylossesonthesedeposits.

AtJanuary31,2016,nosinglecustomerrepresentedmorethan10%ofaccountsreceivable.AtJanuary31,2017andJuly31,2017,onecustomerrepresented21%andanother,18%,respectively,ofaccountsreceivable.FortheyearendedJanuary31,2016and2017andthesixmonthsendedJuly31,2016and2017,nosinglecustomeraccountedfor10%ormoreofrevenue.

Accounts Receivable and Allowance for Doubtful Accounts

Accountsreceivablearerecordedattheinvoicedamount.Wegenerallydonotrequirecollateralandestimatetheallowancefordoubtfulaccountsbasedontheageofoutstandingreceivables,customercreditworthinessandexistingeconomicconditions.Ifeventsorchangesincircumstancesindicatethatspecificreceivablebalancesmaybeimpaired,furtherconsiderationisgiventothecollectabilityofthosebalancesandanallowanceisrecordedaccordingly.Past‑duereceivablebalancesarewrittenoffwheninternalcollectioneffortshavebeenunsuccessfulincollectingtheamountdue.AsofbothJanuary31,2016andJanuary31,2017,theallowancefordoubtfulaccountswas$0.1million.AsofJuly31,2017,theallowancefordoubtfulaccountswas$0.2million.Themovementsintheallowancefordoubtfulaccountswerenotsignificantforanyoftheperiodspresented.

Property and Equipment, Net

Propertyandequipmentarestatedatcost,netofaccumulateddepreciationandamortization.Depreciationandamortizationofpropertyandequipmentiscalculatedusingastraight‑linemethodovertheestimatedusefullivesoftherespectiveassets.Maintenanceandrepairsthatdonotextendthelifeorimprovetheassetareexpensedwhenincurred.

TheestimatedusefullivesoftheCompany’sassetsareasfollows:

Computersoftware 2yearsComputerequipment 2-3yearsFurnitureandofficeequipment 3yearsLeaseholdimprovements Shorterofremainingleasetermorestimatedusefullife

Wereviewpropertyandequipmentforimpairmentwhenevereventsorchangesincircumstancesindicatethatthecarryingamountoftheassetsmaynotberecoverable.Animpairmentlossisrecognizedwhenthetotalofestimatedundiscountedfuturecashflowsexpectedtoresultfromtheuseoftheassetanditseventualdispositionislessthanitscarryingamount.Impairment,ifany,wouldbeassessedusingdiscountedcashflowsorother

F-13

appropriatemeasuresoffairvalue.TherewasnoimpairmentofpropertyandequipmentduringtheyearsendedJanuary31,2016or2017orthesixmonthsendedJuly31,2016and2017.

Goodwill and Intangible Assets

Goodwillrepresentstheexcessofthepurchasepriceinabusinesscombinationoverthefairvalueofnettangibleandintangibleassetsacquired.Goodwillamountsarenotamortized,butrathertestedforimpairmentatleastannuallyinNovemberormoreoftenifandwhencircumstancesindicatethatthecarryingvaluemaynotberecoverable.

Intangibleassetsareamortizedovertheirusefullives.Eachperiodweevaluatetheestimatedremainingusefullifeofourintangibleassetsandwhethereventsorchangesincircumstanceswarrantarevisiontotheremainingperiodofamortization.

Weevaluatetherecoverabilityofourlong‑livedassets,includingintangibleassets,forpossibleimpairmentwhenevereventsorcircumstancesindicatethatthecarryingamountofsuchassetsmaynotberecoverable.Recoverabilityoftheseassetsismeasuredbycomparisonofthecarryingamountofeachassettothefutureundiscountedcashflowstheassetisexpectedtogenerate.Iftheundiscountedcashflowsusedinthetestforrecoverabilityarelessthanthecarryingamountoftheseassets,thenthecarryingamountofsuchassetsisreducedtofairvalue.

TherewerenoimpairmentsofgoodwillorintangibleassetsduringtheyearsendedJanuary31,2016or2017orthesixmonthsendedJuly31,2016and2017.

Business Combinations

Weuseourbestestimatesandassumptionstoassignfairvaluetotangibleandintangibleassetsacquiredandliabilitiesassumedattheacquisitiondate.Suchestimatesareinherentlyuncertainandsubjecttorefinement.Wecontinuetocollectinformationandreevaluatetheseestimatesandassumptionsandrecordanyadjustmentstothepreliminaryestimatestogoodwillprovidedthatwearewithinthemeasurementperiod.Upontheconclusionofthemeasurementperiodorfinaldeterminationofthefairvalueofassetsacquiredorliabilitiesassumed,whichevercomesfirst,anysubsequentadjustmentsarerecordedtotheconsolidatedstatementsofoperations.

Capitalized Software Costs

Capitalizationofsoftwaredevelopmentcostsforproductstobesoldtothirdpartiesbeginsupontheestablishmentoftechnologicalfeasibilityandceaseswhentheproductisavailableforgeneralrelease.Thereisgenerallynosignificantpassageoftimebetweenachievementoftechnologicalfeasibilityandtheavailabilityofoursoftwareforgeneralrelease,andthemajorityofoursoftwareisopen‑source.Therefore,wehavenotcapitalizedanysoftwarecoststhroughJanuary31,2016or2017orJuly31,2017.Allsoftwaredevelopmentcostshavebeenchargedtoresearchanddevelopmentexpenseintheconsolidatedstatementsofoperationsasincurred.

Deferred Offering Costs

Deferredofferingcosts,whichconsistofdirectincrementallegal,consulting,bankingandaccountingfeesrelatingtoanticipatedequityofferings,arecapitalizedandhavebeenoffsetagainstproceedsofourIPOonMay3,2017.AsofJanuary31,2017therewere$2.8millionofcapitalizeddeferredofferingcostsinotherassetsontheconsolidatedbalancesheet.AsofJuly31,2017,alldeferredofferingcostshadbeenrecordedagainstthegrossproceedsfromtheIPO.

Comprehensive Loss

Comprehensivelossrepresentsthenetlossfortheperiodplustheresultsofcertainchangestostockholders’deficitthatarenotreflectedintheconsolidatedstatementsofoperations.

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Revenue Recognition

Wegeneraterevenuefromsubscriptionsandservices.Subscriptionarrangementsaretypicallyonetothreeyearsinlengthbutmaybeuptosevenyearsinlimitedcases.Arrangementswithourcustomerstypicallydonotincludegeneralrightsofreturn.Incrementaldirectcostsincurredrelatedtotheacquisitionororiginationofacustomercontractareexpensedasincurred.

Revenuerecognitioncommenceswhenallofthefollowingcriteriaaremet:(i)persuasiveevidenceofanarrangementexists;(ii)deliveryhasoccurred;(iii)thefeeisfixedordeterminable;and(iv)collectionisprobable.

Subscription revenue

Subscriptionrevenuerelatestoterm(ortime‑based)subscriptionagreementsforbothopensourceandproprietarysoftware.Subscriptionsincludeinternet,emailandphonesupport,bugfixes,andtherighttoreceiveunspecifiedsoftwareupdatesandupgradesreleasedwhenandifavailableduringthesubscriptionterm.Revenueforsubscriptionarrangementsisrecognizedratablyoverthecontractualtermofthearrangementbeginningonthedateaccesstothesubscriptionismadeavailabletothecustomer.

Services revenue

Servicesrevenuerelatestoprofessionalservicesfortheimplementationanduseofoursubscriptions,trainingandeducationservicesandrelatedreimbursabletravelcosts.

Fortimeandmaterialsandfixedfeearrangements,revenueisrecognizedastheservicesareperformedoruponacceptance,ifapplicable.Formilestone‑basedarrangements,revenueisrecognizeduponacceptanceorsubsequenttocompletionuponthelapseofanyacceptanceperiod.

Revenuefortrainingandeducationservicesisrecognizedupondelivery,exceptforOn‑DemandTraining,whichisrecognizedratablyoverthecontractualterm.

Multiple ‑element arrangements

Arrangementswithourcustomersgenerallyincludemultipleelementssuchassubscriptionandservices.Weallocaterevenuetoeachelementofthearrangementbasedonvendor‑specificobjectiveevidenceofeachelement’sfairvalue(VSOE)whenwecandemonstratesufficientevidenceofthefairvalue.VSOEforelementsofanarrangementisbaseduponthenormalpricinganddiscountingpracticesforthoseelementswhensoldseparatelyonastand‑alonebasis.

WehaveestablishedVSOEforsomeofourservices.IfVSOEforoneormoreundeliveredelementsdoesnotexist,revenuerecognitiondoesnotcommenceuntildeliveryofboththesubscriptionandserviceshavecommenced,orwhenVSOEoftheundeliveredelementshasbeenestablished.Oncerevenuerecognitioncommences,revenueforthearrangementisrecognizedratablyoverthelongestserviceperiodinthearrangement.

Reseller arrangements

Werecognizesubscriptionrevenueforsalesthroughresellersorotherindirectsaleschannels.Subscriptionrevenuefromthesesalesisgenerallyrecognizeduponsell‑throughtoanendusercustomer.Wherepaymentstousarebelievedtobecontingentuponpaymentbytheendusertothereseller,subscriptionrevenueisnotrecognizeduntilcashiscollected.

Deferred revenue

Deferredrevenueconsistsofamountsbilledtoorcollectedfromcustomersunderabindingagreementprovideddeliveryoftherelatedsubscriptionandserviceshascommenced.

F-15

Cost of Revenue

Costofrevenueforsubscriptionsandservicesisexpensedasincurred.Costofrevenueforsubscriptionsprimarilyconsistsofpersonnelcostssuchassalaries,bonusesandbenefitsandstock‑basedcompensationforemployeesprovidingtechnicalsupportforoursubscriptioncustomers,allocatedsharedcosts(includingrentandinformationtechnology)andamortizationofacquiredintangibleassets.Costofrevenueforservicesprimarilyconsistsofpersonnelcostsforemployeesandsubcontractorsassociatedwithservicecontracts,travelcostsandallocatedsharedcosts.


Researchanddevelopmentcostsareexpensedasincurredandprimarilyincludepersonnelcosts,contractorfees,allocatedsharedcosts,supplies,anddepreciationofequipmentassociatedwiththedevelopmentofnewfeaturesforoursubscriptionspriortotheestablishmentoftheirtechnologicalfeasibility.

Advertising Costs

Advertisingcostsareexpensedasincurred.Advertisingcostswere$0.7millionand$0.8millionfortheyearsendedJanuary31,2016and2017,respectively,and$0.4millionand$0.3millionforthesixmonthsendedJuly31,2016and2017,respectively.

Stock‑‑Based Compensation

Werecognizestock‑basedcompensationexpenseforallstock‑basedpayments.Employeestock‑basedcompensationcostisestimatedatthegrantdatebasedonthefairvalueoftheequityforfinancialreportingpurposesandisrecognizedasexpenseovertherequisiteserviceperiod.PriortoourIPO,fairvalueofourcommonstockforfinancialreportingpurposeswasdeterminedconsideringobjectiveandsubjectivefactorsandrequiredjudgmenttodeterminethefairvalueofcommonstockforfinancialreportingpurposesasofthedateofeachequitygrantormodification.Theseobjectiveandsubjectivefactorsincluded,butwerenotlimitedto:

• relevantprecedenttransactionsinvolvingourcapitalstock;

• contemporaneousvaluationsperformedbythirdpartyspecialists;

• rights,preferences,andprivilegesofourredeemableconvertiblepreferredstockrelativetothoseofourcommonstock;

• actualoperatingandfinancialperformance;

• currentbusinessconditionsandfinancialprojections;

• likelihoodofachievingaliquidityevent,suchasanIPOorasaleofourbusiness;

• thelackofmarketabilityofourcommonstock,andtheilliquidityofstock‑basedawardsinvolvingsecuritiesinaprivatecompany;

• recentsecondarystocksales;

• marketmultiplesofcomparablepublicly‑tradedcompanies;

• stageofdevelopment;

• industryinformationsuchasmarketsizeandgrowth;and

• U.S.andglobalcapitalmarketandmacroeconomicconditions.

WehaveelectedtocalculatethefairvalueofoptionsbasedontheBlack‑Scholesoption‑pricingmodel.TheBlack‑Scholesmodelrequirestheuseofvariousassumptionsincludingexpectedoptionlifeandexpectedstockpricevolatility.Weestimatetheexpectedtermforstockoptionsusingthesimplifiedmethodduetothelackof

F-16

historicalexerciseactivity.Thesimplifiedmethodcalculatestheexpectedtermasthemidpointbetweenthevestingdateandthecontractualexpirationdateoftheaward.Weestimatetheoptions’volatilityusingvolatilitiesofagroupofpubliccompaniesinacomparableindustry,stageoflifecycle,andsize.Theinterestrateisderivedfromgovernmentbondswithasimilartermastheoptions’expectedlives.Wehavenotdeclarednordoweexpecttodeclaredividends.Therefore,thereisnodividendimpactonthevaluationofoptions.Weareusingthestraight‑line(single‑option)methodforemployeeexpenseattributionforstockoptions.

WehavegrantedRSUstoouremployeesandmembersofourboardofdirectorsunderthe2008EquityIncentivePlan(2008Plan).TheemployeeRSUsvestuponthesatisfactionofbothaservice‑basedvestingconditionandaliquidityevent‑relatedperformancecondition.Theservice‑basedconditionforthemajorityoftheseawardsisgenerallysatisfiedpro‑rataoverfouryears.Theliquidityevent‑relatedperformanceconditionissatisfiedupontheoccurrenceofaqualifyingliquidityevent,suchastheeffectivedateofanIPO,orsixmonthsfollowingtheeffectivedateofanIPO.DuringthequarterendedApril30,2017,themajorityofRSUsweremodifiedsuchthattheliquidityevent‑relatedperformanceconditionissatisfiedupontheeffectivedateofanIPO,ratherthansixmonthsfollowinganIPO.ThemodificationestablishedanewmeasurementdateforthesemodifiedRSUs.Theliquidityevent‑relatedperformanceconditionisviewedasaperformance‑basedcriterionforwhichtheachievementofsuchliquidityeventisnotdeemedprobableforaccountingpurposesuntiltheeventoccurs.Theliquidityevent‑relatedperformanceconditionwasachievedforthemajorityofourRSUsandbecameprobableofbeingachievedfortheremainingRSUsonApril27,2017,theeffectivedateofourIPO.Werecognizedstock‑basedcompensationexpenseusingtheacceleratedattributionmethodwithacumulativecatch‑upofstock‑basedcompensationexpenseintheamountof$181.5millionforthesixmonthsendedJuly31,2017,attributabletoservicepriortosucheffectivedate.SharessubjecttoRSUsinwhichtheliquidityevent-relatedperformanceconditionwassatisfiedupontheeffectivedateoftheIPOwillbeissuedonadatetobedeterminedbytheboardofdirectorsthatwillbeafterthesecondfulltradingdayfollowingthereleaseofearningsbyusforthesecondquarteroffiscal2018totheextenttheservice‑basedconditionhasbeenmet.

PriortoourIPO,stock‑basedcompensationexpensewasalsorecordedwhenaholderofaneconomicinterestinClouderapurchasedsharesfromanemployeeforanamountinexcessofthefairvalueofthecommonstockatthetimeofthepurchase.Werecognizedanyexcessvaluetransferredinthesetransactionsasstock‑basedcompensationexpenseintheconsolidatedstatementofoperations.

Optionsandotherequityawardsgrantedtonon‑employeesareaccountedforattheirestimatedfairvalueusingtheBlack‑Scholesmethod.Theseawardsaresubjecttoperiodicre‑measurementovertheperiodduringwhichservicesarerendered.Stock‑basedcompensationexpenseisrecognizedoverthevestingperiodonastraight‑linebasis.

Income Taxes

Weaccountforincometaxesundertheliabilitymethod,wherebydeferredtaxassetsandliabilitiesaredeterminedbasedonthedifferencebetweenthefinancialstatementandtaxbasisofassetsandliabilitiesusingenactedtaxratesineffectfortheyearinwhichthedifferencesareexpectedtoaffecttaxableincome.Avaluationallowanceisestablishedwhen,inmanagement’sestimate,itismorelikelythannotthatthedeferredtaxassetwillnotberealized.

Anyliabilityrelatedtouncertaintaxpositionsisrecordedonthefinancialstatementswithinotherliabilities.Penaltiesandinterestexpenserelatedtoincometaxes,includinguncertaintaxpositions,areclassifiedasacomponentofprovisionforincometaxes,asnecessary.

Net Loss Per Share Attributable to Common Stockholders

Wefollowthetwo‑classmethodwhencomputingnetlosspercommonshareasweissuesharesthatmeetthedefinitionofparticipatingsecurities.Thetwo‑classmethoddeterminesnetincome(loss)percommonshareforeachclassofcommonstockandparticipatingsecuritiesaccordingtodividendsdeclaredoraccumulatedandparticipationrightsinundistributedearnings.Thetwo‑classmethodrequiresincomeavailabletocommonstockholdersfortheperiodtobeallocatedbetweencommonstockandparticipatingsecuritiesbasedupontheirrespectiverightstoreceivedividendsasifallincomefortheperiodhadbeendistributed.Priortotheautomaticconversionintoshares

F-17

ofcommonstockasaresultofourIPO,ourredeemableconvertiblepreferredstockcontractuallyentitledtheholdersofsuchsharestoparticipateindividends,butdidnotcontractuallyrequiretheholdersofsuchsharestoparticipateinourlosses.Forperiodsinwhichwehavereportednetlosses,dilutednetlosspercommonshareattributabletocommonstockholdersisthesameasbasicnetlosspercommonshareattributabletocommonstockholders,becausepotentiallydilutivecommonsharesarenotassumedtohavebeenissuediftheireffectisanti‑dilutive.

Commitments and Contingencies

Liabilitiesforlosscontingenciesarisingfromclaims,assessments,litigation,finesandpenaltiesandothersourcesarerecordedwhenitisprobablethataliabilityhasbeenorwillbeincurredandtheamountoftheliabilitycanbereasonablyestimated.Legalcostsincurredinconnectionwithlosscontingenciesareexpensedasincurred.

JOBS Act Accounting Election

Weareanemerginggrowthcompany,asdefinedintheJumpstartOurBusinessStartupsActof2012(JOBSAct).UndertheJOBSAct,emerginggrowthcompaniescandelayadoptingneworrevisedaccountingstandardsissuedsubsequenttotheenactmentoftheJOBSActuntilsuchtimeasthosestandardsapplytoprivatecompanies.Wehaveelectedtoretaintheabilitytousethisextendedtransitionperiodforcomplyingwithneworrevisedaccountingstandardsthathavedifferenteffectivedatesforpublicandprivatecompaniesuntiltheearlierofthedatewe(i)arenolongeranemerginggrowthcompanyor(ii)affirmativelyandirrevocablyoptoutoftheextendedtransitionperiodprovidedintheJOBSAct.Asaresult,ourfinancialstatementsmaynotbecomparabletocompaniesthatcomplywithneworrevisedaccountingpronouncementsasofpubliccompanyeffectivedates.

Recently Adopted Accounting Standards

InNovember2015,theFinancialAccountingStandardsBoard(FASB)issuedAccountingStandardsUpdate,orASU,No.2015‑17,Balance SheetClassification of Deferred Taxes ,orASU2015‑17,whichsimplifiesthepresentationofdeferredincometaxes.ASU2015‑17providespresentationrequirementstoclassifydeferredtaxassetsandliabilitiesasnoncurrentinaclassifiedstatementoffinancialposition.Forpublicbusinessentities,thisstandardiseffectiveforfinancialstatementsissuedforannualperiodsbeginningafterDecember15,2016,andinterimperiodswithinthoseannualperiods.Forallotherentities,thisstandardiseffectiveforfinancialstatementsissuedforannualperiodsbeginningafterDecember15,2017,andinterimperiodswithinannualperiodsbeginningafterDecember15,2018.Earlyadoptionispermittedforallentitiesasofthebeginningofaninterimorannualreportingperiod.Weearlyadoptedthisstandardprospectivelyinfiscal2017whichdidnothaveamaterialimpactonourconsolidatedfinancialstatements.

InNovember2016,theFASBissuedASUNo.2016‑18,Statement of Cash Flows (Topic 230): Restricted Cash ,orASU2016‑18.ASU2016‑18requiresthatthestatementofcashflowsexplainsthechangeduringtheperiodinthetotalcash,cashequivalents,andrestrictedcash.Forpublicentities,thisstandardiseffectiveforfiscalyearsbeginningafterDecember15,2017,andinterimperiodswithinthosefiscalyears.Forallotherentities,thisstandardiseffectiveforfiscalyearsbeginningafterDecember15,2018,andinterimperiodswithinfiscalyearsbeginningafterDecember15,2019.Thisstandardshouldbeappliedretrospectivelyandearlyadoptionispermitted,includingadoptioninaninterimperiod.Weearlyadoptedthisstandardinfiscal2017andhaveretroactivelyadjustedtheconsolidatedstatementsofcashflowsforallperiodspresented.

InMarch2016,theFinancialAccountingStandardsBoard(FASB)issuedASUNo.2016‑09,Compensation – Stock Compensation (Topic 718):Improvements to Employee Share‑Based Payment Accounting ,orASU2016‑09,whichsimplifiestheaccountingandreportingofshare‑basedpaymenttransactions,includingadjustmentstohowexcesstaxbenefitsandpaymentsfortaxwithholdingsshouldbeclassifiedandprovidestheelectiontoeliminatetheestimateforforfeitures.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2016,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017,andinterimperiodswithinannualperiodsbeginningafterDecember15,2018.Earlyadoptionispermittedforanyentityinanyinterimorannualperiodforwhichfinancialstatementshavenotbeenissuedormadeavailableforissuance.Weearlyadoptedthisstandardin

F-18

thefirstquarteroffiscal2018.Asaresultofthisadoption,wehaveelectedtoaccountforforfeituresastheyoccur.Theadoptionofthisstandarddidnothaveamaterialimpactonourconsolidatedfinancialstatements.

Recently Issued Accounting Standards

InMay2014,theFASBissuedASUNo.2014‑09,Revenue from Contracts with Customers (Topic 606) ,orASU2014‑09,whichamendedtheexistingFASBAccountingStandardsCodification.ASU2014‑09establishesaprincipleforrecognizingrevenueuponthetransferofpromisedgoodsorservicestocustomers,inanamountthatreflectstheexpectedconsiderationreceivedinexchangeforthosegoodsorservicesandalsoprovidesguidanceontherecognitionofcostsrelatedtoobtainingandfulfillingcustomercontracts.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018,andinterimperiodswithinannualperiodsbeginningafterDecember15,2019.Earlyadoptionispermitted.

Wearecurrentlyintheprocessofassessingtheadoptionmethodology,whichallowsASU2014‑09tobeappliedeitherretrospectivelytoeachpriorperiodpresentedorwiththecumulativeeffectrecognizedasofthedateofinitialapplication.Ourfinaldeterminationwilldependonanumberoffactors,suchasthesignificanceoftheimpactofthenewstandardonourfinancialresults,systemreadiness,includingthatofsoftwareprocuredfromthird‑partyproviders,andourabilitytoaccumulateandanalyzetheinformationnecessarytoassesstheimpactonpriorperiodfinancialstatements,asnecessary.

WearealsocurrentlyevaluatingtheimpactASU2014‑09willhaveonourconsolidatedfinancialstatements.WeareintheinitialstagesofourevaluationoftheimpactofASU2014‑09onouraccountingpolicies,processes,andsystemrequirements.Wehaveassignedinternalresourcesinadditiontoengagingthirdpartyserviceproviderstoassistintheevaluation.WhilewecontinuetoassessallpotentialimpactsunderASU2014‑09,thereisthepotentialforsignificantimpactsonthetimingofourrevenuerecognitionandcontractacquisitioncosts,suchassalescommissions.AccountingforcertainsalescommissionsunderASU2014‑09isdifferentthanourcurrentaccountingpolicywhichistoexpensesalescommissionsasincurredwhereassuchcostswillbedeferredandamortizedunderASU2014‑09.Additionally,wepreliminarilybelievethattheamortizationperiodforsuchdeferredcommissioncostswillbelongerthanthecontractterm,asASU2014‑09requiresentitiestodeterminewhetherthecostsrelatetospecificanticipatedcontracts.

WhilewecontinuetoassessthepotentialimpactsofASU2014‑09,includingtheareasdescribedabove,andanticipateASU2014‑09couldhaveamaterialimpactonourconsolidatedfinancialstatements,wedonotknowandcannotreasonablyestimatethequantitativeimpactonourfinancialstatementsatthistime.

InFebruary2016,theFASBissuedASUNo.2016‑02,Leases (Topic 842) ,orASU2016‑02,whichrequireslesseestorecordmostleasesontheirbalancesheetsbutrecognizetheexpensesontheirincomestatementsinamannersimilartocurrentpractice.ASU2016‑02statesthatalesseewouldrecognizealeaseliabilityfortheobligationtomakeleasepaymentsandaright‑to‑useassetfortherighttousetheunderlyingassetfortheleaseterm.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2019,andinterimperiodswithinannualperiodsbeginningafterDecember15,2020.Earlyadoptionispermitted.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InJune2016theFASBissuedASUNo.2016‑13,Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,orASU2016‑13.ASU2016‑13requiresthemeasurementofallexpectedcreditlossesforfinancialassetsheldatthereportingdatebasedonhistoricalexperience,currentconditions,andreasonableandsupportableforecasts.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2019,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2020,includinginterimperiodswithinthatreportingperiod.Earlieradoptionispermittedinourfirstinterimperiodinfiscal2020.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

F-19

InAugust2016,theFASBissuedASUNo.2016‑15,Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments ,orASU2016‑15.ASU2016‑15identifieshowcertaincashreceiptsandcashpaymentsarepresentedandclassifiedintheStatementofCashFlows.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018,andinterimperiodswithinannualperiodsbeginningafterDecember15,2019.Thisstandardshouldbeappliedretrospectivelyandearlyadoptionispermitted,includingadoptioninaninterimperiod.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InOctober2016,theFASBissuedASUNo.2016-16,Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ,orASU2016-16.ASU2016-16requiresentitiestorecognizetheincometaxconsequencesofanintra-entitytransferofanasset,otherthaninventory,whenthetransferoccurs.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2017.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2018.Earlyadoptionispermittedasofthebeginningofanannualperiod.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InJanuary2017,theFASBissuedASUNo.2017‑04,Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, orASU2017‑04.ASU2017‑04simplifieshowanentityisrequiredtotestgoodwillforimpairmentbyeliminatingStep2fromthegoodwillimpairmenttest.Forpublicentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2019,includinginterimperiodswithinthatreportingperiod.Forallotherentities,thisstandardiseffectiveforannualreportingperiodsbeginningafterDecember15,2021.EarlyadoptionispermittedforinterimorannualgoodwillimpairmenttestsperformedontestingdatesafterJanuary1,2017.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

InMay2017,theFASBissuedASUNo.2017-09,Compensation -Stock Compensation (Topic 718): Scope of Modification Accounting ,orASU2017-09,whichclarifieswhentoaccountforachangetothetermsorconditionsofashare-basedpaymentawardasamodification.UnderASU2017-09,modificationaccountingisrequiredonlyifthefairvalue,thevestingconditions,ortheclassificationoftheaward(asequityorliability)changesasaresultofthechangeintermsorconditions.ThisstandardiseffectiveforallentitiesforannualreportingperiodsbeginningafterDecember15,2017,includinginterimperiodswithinthatreportingperiod.Earlyadoptionispermitted.Wearecurrentlyevaluatingtheimpactthatthisstandardwillhaveonourconsolidatedfinancialstatements.

Reclassifications

CertainreclassificationstotheconsolidatedstatementofoperationsfortheyearendedJanuary31,2016weremadetoconformtothecurrentyearpresentation.Thesereclassificationsincludecostofrevenueandoperatingexpenses.

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3. Cash Equivalents and Marketable Securities

ThefollowingarethefairvaluesofourcashequivalentsandmarketablesecuritiesasofJanuary31,2016(inthousands):

Amortized

Cost Unrealized

Gains Unrealized

Losses Estimated Fair Value

Cashequivalents:(1) Moneymarketfunds $ 22,434 $ — $ — $ 22,434Commercialpaper 7,999 — (1) 7,998

Marketablesecurities: U.S.agencyobligations 6,039 — (4) 6,035Asset-backedsecurities 71,026 11 (46) 70,991Corporatenotesandobligations 214,535 31 (231) 214,335Commercialpaper 15,989 — — 15,989Municipalsecurities 33,869 21 (9) 33,881U.S.treasurysecurities 21,064 7 (23) 21,048

Totalcashequivalentsandmarketablesecurities $ 392,955 $ 70 $ (314) $ 392,711

ThefollowingarethefairvaluesofourcashequivalentsandmarketablesecuritiesasofJanuary31,2017(inthousands):

Amortized

Cost Unrealized

Gains Unrealized


Cashequivalents:(1) Moneymarketfunds $ 49,390 $ — $ — $ 49,390U.S.agencyobligations 3,249 — — 3,249Corporatenotesandobligations 2,050 — — 2,050Commercialpaper 3,998 — — 3,998

Marketablesecurities: Asset-backedsecurities 39,281 — (17) 39,264Corporatenotesandobligations 105,698 5 (116) 105,587Municipalsecurities 16,128 — (23) 16,105Certificateofdeposit 15,500 20 — 15,520U.S.treasurysecurities 5,004 — — 5,004


F-21

ThefollowingarethefairvaluesofourcashequivalentsandmarketablesecuritiesasofJuly31,2017(inthousands):

Amortized

Cost Unrealized

Gains Unrealized


(unaudited)Cashequivalents:(1)

Moneymarketfunds $ 6,173 $ — $ — $ 6,173Corporatenotesandobligations 4,000 — — 4,000Commercialpaper 15,097 — — 15,097Municipalsecurities 6,000 — (1) 5,999

Reverserepurchaseagreements(2) 9,000 — — 9,000

Marketablesecurities: U.S.agencyobligations 17,816 — (4) 17,812Asset-backedsecurities 45,521 — (22) 45,499Corporatenotesandobligations 192,811 47 (105) 192,753Commercialpaper 80,554 1 (1) 80,554Municipalsecurities 14,348 13 (3) 14,358Certificatesofdeposit 49,850 7 (3) 49,854U.S.treasurysecurities 5,985 1 — 5,986


___________(1) Includedin“cashandcashequivalents”intheaccompanyingconsolidatedbalancesheetasofJanuary31,2016and2017andJuly31,2017.

(2) Aspartofourcashmanagementstrategy,weinvestinreverserepurchaseagreements.Suchreverserepurchaseagreementsaretri-partyrepurchaseagreementsandhavematuritiesofthreemonthsorlessatthetimeofinvestmentandarecollateralizedbyU.S.treasurysecuritiesat102%oftheprincipalamount.Inatri-partyrepurchaseagreement,athird-partycustodianbankfunctionsasanindependentintermediarytofacilitatetransferofcashandholdingthecollateralonbehalfoftheunderlyinginvestorforthetermoftheagreementtherebyminimizingriskandexposuretobothparties.Thesereverserepurchaseagreementsareincludedwithincashequivalentsduetotheirhighliquidityandrelativelylowrisk.

MaturitiesofournoncurrentmarketablesecuritiesgenerallyrangefromoneyeartofouryearsatbothJanuary31,2016and2017andJuly31,2017.

AsofJanuary31,2016,thefollowingmarketablesecuritieswereinanunrealizedlossposition(inthousands):

Less than 12 months Greater than 12 months Total

Fair Value Unrealized

Losses Fair Value Unrealized


Losses

U.S.agencyobligations $ 6,035 $ (4) $ — $ — $ 6,035 $ (4)

Asset-backedsecurities 42,184 (46) — — 42,184 (46)

Corporatenotesandobligations 161,385 (219) 16,662 (12) 178,047 (231)

Commercialpaper 11,997 (1) — — 11,997 (1)

Municipalsecurities 7,021 (9) — — 7,021 (9)

U.S.treasurysecurities 13,044 (23) — — 13,044 (23)

Total $ 241,666 $ (302) $ 16,662 $ (12) $ 258,328 $ (314)

NomarketablesecuritiesheldasofJanuary31,2017hadbeeninacontinuousunrealizedlosspositionformorethantwelvemonths.

F-22

AsofJuly31,2017,thefollowingmarketablesecuritieswereinanunrealizedlossposition(inthousands):

Less than 12 months Greater than 12 months Total

Fair Value Unrealized



Losses (unaudited)

U.S.agencyobligations $ 17,813 $ (4) $ — $ — $ 17,813 $ (4)

Asset-backedsecurities 44,278 (21) 1,221 (1) 45,499 (22)

Corporatenotesandobligations 106,474 (86) 8,391 (19) 114,865 (105)

Commercialpaper 14,980 (1) — — 14,980 (1)

Municipalsecurities 11,001 (3) 1,974 (1) 12,975 (4)

Certificatesofdeposit 20,997 (3) — — 20,997 (3)Total $ 215,543 $ (118) $ 11,586 $ (21) $ 227,129 $ (139)

Theunrealizedlossforeachofthesefixedratemarketablesecuritiesrangedfromlessthan$1,000to$28,000asofJanuary31,2016andlessthan$1,000to$26,000asofJanuary31,2017and$1,000to$15,000asofJuly31,2017.Wedonotbelieveanyoftheunrealizedlossesrepresentanother‑than‑temporaryimpairmentbasedonourevaluationofavailableevidenceasofJanuary31,2016and2017andJuly31,2017.Weexpecttoreceivethefullprincipalandinterestonallofthesemarketablesecuritiesandhavetheabilityandintenttoholdtheseinvestmentsuntilarecoveryoffairvalue.

Realizedgainsandrealizedlossesonourcashequivalentsandmarketablesecuritiesareincludedinotherincome(expense),netontheconsolidatedstatementofoperationsandwerenotmaterialfortheyearsendedJanuary31,2016and2017andthesixmonthsendedJuly31,2016and2017.

ReclassificationadjustmentsoutofaccumulatedothercomprehensivelossintonetlosswerenotmaterialfortheyearsendedJanuary31,2016and2017andthesixmonthsendedJuly31,2016and2017.

4. Fair Value Measurement

Ourfinancialassetsandliabilitiesconsistprincipallyofcashandcashequivalents,marketablesecurities,restrictedcash,accountsreceivable,andaccountspayable.Wemeasureandrecordcertainfinancialassetsandliabilitiesatfairvalueonarecurringbasis.Theestimatedfairvalueofaccountsreceivableandaccountspayableapproximatestheircarryingvalueduetotheirshort‑termnature.Cashequivalents,marketablesecuritiesandrestrictedcasharerecordedatestimatedfairvalue.

AllofourcashequivalentsandmarketablesecuritiesareclassifiedwithinLevel1orLevel2becausethecashequivalentsandmarketablesecuritiesarevaluedusingquotedmarketpricesoralternativepricingsourcesandmodelsutilizingobservablemarketinputs.

Wefollowathree‑levelvaluationhierarchyfordisclosureoffairvaluemeasurementsasfollows:

Level1 Inputsareunadjustedquotedpricesinactivemarketsforidenticalassetsorliabilitiesatthemeasurementdate.

Level2 Inputs(otherthanquotedmarketpricesincludedinLevel1)areeitherdirectlyorindirectlyobservablefortheassetorliabilitythroughcorrelationwithmarketdataatthemeasurementdateandforthedurationoftheinstrument’santicipatedlife.

Level3 Inputsreflectmanagement’sbestestimateofwhatmarketparticipantswoulduseinpricingtheassetorliabilityatthemeasurementdate.Considerationisgiventotheriskinherentinthevaluationtechniqueandtheriskinherentintheinputstothemodel.

F-23

Thefollowingtablerepresentsourfinancialassetsandliabilitiesaccordingtothefairvaluehierarchy,measuredatfairvalueasofJanuary31,2016(inthousands):

Level 1 Level 2 Level 3 Total

Cash equivalents: Moneymarketfunds $ 22,434 $ — $ — $ 22,434Commercialpaper — 7,998 — 7,998

Marketable securities: U.S.agencyobligations — 6,035 — 6,035Asset-backedsecurities — 70,991 — 70,991Corporatenotesandobligations — 214,335 — 214,335Commercialpaper — 15,989 — 15,989Municipalsecurities — 33,881 — 33,881U.S.treasurysecurities — 21,048 — 21,048

Restricted cash: Moneymarketfunds 28 — — 28

Totalfinancialassets $ 22,462 $ 370,277 $ — $ 392,739

Thefollowingtablerepresentsourfinancialassetsandliabilitiesaccordingtothefairvaluehierarchy,measuredatfairvalueasofJanuary31,2017(inthousands):

Level 1 Level 2 Level 3 Total

Cash equivalents: Moneymarketfunds $ 49,390 $ — $ — $ 49,390U.S.agencyobligations — 3,249 — 3,249Corporatenotesandobligations — 2,050 — 2,050Commercialpaper — 3,998 — 3,998

Marketable securities: Asset-backedsecurities — 39,264 — 39,264Corporatenotesandobligations — 105,587 — 105,587Municipalsecurities — 16,105 — 16,105

Certificateofdeposit 15,520 15,520U.S.treasurysecurities — 5,004 — 5,004

Restricted cash: Moneymarketfunds 15,446 — — 15,446


F-24

Thefollowingtablerepresentsourfinancialassetsandliabilitiesaccordingtothefairvaluehierarchy,measuredatfairvalueasofJuly31,2017(inthousands):

Level 1 Level 2 Level 3 Total (unaudited)Cash equivalents:

Moneymarketfunds $ 6,173 $ — $ — $ 6,173Corporatenotesandobligations — 4,000 — 4,000Commercialpaper — 15,097 — 15,097Municipalsecurities — 5,999 — 5,999Reverserepurchaseagreement — 9,000 — 9,000

Marketable securities: U.S.agencyobligations — 17,812 — 17,812Asset-backedsecurities — 45,499 — 45,499Corporatenotesandobligations — 192,753 — 192,753Commercialpaper — 80,554 — 80,554Municipalsecurities — 14,358 — 14,358Certificatesofdeposit — 49,854 — 49,854U.S.treasurysecurities — 5,986 — 5,986

Restricted cash: Moneymarketfunds 14,672 — — 14,672


WevalueourLevel1assetsusingquotedpricesinactivemarketsforidenticalinstruments.WevalueourLevel2assetswiththehelpofathird‑partypricingserviceusingquotedmarketpricesforsimilarinstruments,nonbindingmarketpricesthatarecorroboratedbyobservablemarketdata,orpricingmodelssuchasdiscountedcashflowtechniques.Weusesuchpricingdataastheprimaryinput,towhichwehavenotmadeanymaterialadjustmentsduringtheperiodspresented,tomakeourdeterminationandassessmentsastotheultimatevaluationoftheseassets.

TherewerenotransfersintooroutofLevel1,Level2orLevel3assetsandliabilitiesfortheyearsendedJanuary31,2016and2017andthesixmonthsendedJuly31,2016and2017.

5. Balance Sheet Components

Property and Equipment, Net

Thecostandaccumulateddepreciationandamortizationofpropertyandequipmentareasfollows(inthousands):

As of

January 31, As of

July 31,

2016 2017 2017

(unaudited)Computerequipmentandsoftware $ 17,054 $ 17,981 $ 18,165Officefurnitureandequipment 3,462 4,350 5,956Leaseholdimprovements 7,088 8,468 9,400Constructioninprogress — — 2,310

Propertyandequipment,gross 27,604 30,799 35,831Less:accumulateddepreciationandamortization (14,722) (17,695) (22,804)

Propertyandequipment,net $ 12,882 $ 13,104 $ 13,027

F-25

ConstructioninprogressprimarilyconsistsofleaseholdimprovementsthathavenotbeenplacedintoserviceasofJuly31,2017.

Depreciationexpensewas$5.2millionand$6.4millionfortheyearsendedJanuary31,2016and2017,respectively,and$3.1millionand$5.1millionforthesixmonthsendedJuly31,2016and2017,respectively.

Intangible Assets

IntangibleassetsconsistedofthefollowingasofJanuary31,2016(dollarsinthousands):

Gross Fair

Value Accumulated Amortization

Net Book Value

Weighted AverageRemaining Useful

Life (in years)

Developedtechnology $ 8,420 $ (2,575) $ 5,845 3.5

Customerrelationshipsandotheracquiredintangibleassets 6,125 (2,934) 3,191 1.8

Total $ 14,545 $ (5,509) $ 9,036 2.9

IntangibleassetsconsistedofthefollowingasofJanuary31,2017(dollarsinthousands):

Gross Fair


Net Book Value


Life (in years)


Customerrelationshipsandotheracquiredintangibleassets 6,125 (4,681) 1,444 0.8

Total $ 16,280 $ (9,229) $ 7,051 2.5

IntangibleassetsconsistedofthefollowingasofJuly31,2017(dollarsinthousands):

Gross Fair


Net Book Value


Life (in years)

(unaudited)


Customerrelationshipsandotheracquiredintangibleassets 6,125 (5,551) 574 0.3

Total $ 16,280 $ (11,114) $ 5,166 2.3

Amortizationexpenseforintangibleassetswas$3.5millionand$3.7millionduringtheyearsendedJanuary31,2016and2017,respectivelyand$1.8millionand$1.9millionforthesixmonthsendedJuly31,2016and2017,respectively.

F-26

TheexpectedfutureamortizationexpenseoftheseintangibleassetsasofJuly31,2017isasfollows(inthousands,byfiscalyear)(unaudited):

Remainingsixmonthsoffiscal2018 $ 1,5902019 2,0312020 1,1402021 3472022 58

Totalintangibleassets,net $ 5,166

Goodwill

Thefollowingtablerepresentsthechangestogoodwill(inthousands):

BalanceatJanuary31,2015 $ 13,801Additionsfromanacquisition 16,750

BalanceatJanuary31,2016 30,551Additionsfromanacquisition 965

BalanceatJanuary31,2017 31,516Additionsfromacquisitions(unaudited) —

BalanceatJuly31,2017(unaudited) $ 31,516

TherewasnoimpairmentofgoodwillduringtheyearsendedJanuary31,2016or2017andsixmonthsendedJuly31,2016and2017.Goodwillisattributableentirelytooursubscriptionoperatingsegment.

Accrued Compensation

Accruedcompensationconsistsofthefollowing(inthousands):

As of

January 31, As of

July 31,

2016 2017 2017

(unaudited)Accruedsalariesandbenefits $ 1,610 $ 2,330 $ 3,234Accruedbonuses 9,924 15,338 10,369Accruedcommissions 8,094 11,856 7,896Employeestockpurchaseplanwithholdings — — 3,861Accruedcompensationrelatedtaxesandother 2,526 3,852 6,894

Totalaccruedcompensation $ 22,154 $ 33,376 $ 32,254

F-27

Other Accrued Liabilities

Otheraccruedliabilitiesconsistsofthefollowing(inthousands):

As of

January 31, As of

July 31,

2016 2017 2017

(unaudited)Accruedtaxes $ 965 $ 1,585 $ 2,241Deferredrealestatecosts 338 47 523Accruedprofessionalcosts 2,448 2,147 2,196Customerdeposits 256 301 252Deferredsubleaseincome — 861 1,266Accruedself-insurancecosts 1,407 746 938Other 5,759 4,231 8,254

Totalotheraccruedliabilities $ 11,173 $ 9,918 $ 15,670

Otherincludesamountsowedtothird‑partyvendorsthatprovidemarketing,corporateeventplanningandcloud‑computingservices.

6. Business Combinations

Xplain

InFebruary2015,weacquiredalloutstandingequityofXplain.io,Inc.,orXplain,aproviderofaself‑serviceanalyticstool.WeacquiredXplainfortheassembledworkforceandexpectedsynergieswithourcurrentofferings.WehaveincludedthefinancialresultsofXplainintheconsolidatedfinancialstatementsfromthedateofacquisition.TheamountofrevenueandearningsincludedintheconsolidatedfinancialstatementsforthisacquisitionwerenotdeterminablebecausewehaveintegratedXplain’sself‑servicetechnologyanalyticswithourcurrentofferings.Weconcludedthatthisacquisitionrelatestooursubscriptionoperatingsegment.TheacquisitiondatefairvalueoftheconsiderationtransferredforXplainwasapproximately$19.7million,whichconsistedofthefollowing(inthousands,exceptsharedata):

Fair Value

Cash $ 10,153Commonstock(358,735sharesofcommonstock) 9,542

Total $ 19,695

Thefollowingtablesummarizestheestimatedfairvaluesofassetsacquiredandliabilitiesassumedasofthedateofacquisition(dollarsinthousands):

Fair Value Estimated Useful Life

Nettangibleassets $ 1,181 n/aDevelopedtechnologyandotheracquiredintangibleassets 1,764 5yearsGoodwill 16,750 n/a

Netassetsacquired $ 19,695

Theexcessofpurchaseconsiderationoverthefairvalueofnettangibleandidentifiableintangibleassetsacquiredwasrecordedasgoodwill.Thefairvaluesassignedtotangibleandidentifiableintangibleassetsacquiredandliabilitiesassumedwerebasedonmanagement’sestimatesandassumptions.

F-28

TheamountrecordedfordevelopedtechnologyrepresentstheestimatedfairvalueofXplain’sself‑serviceanalyticstechnology.ThegoodwillbalanceisprimarilyattributedtotheassembledworkforceandexpandedmarketopportunitieswhenintegratingXplain’sself‑serviceanalyticstechnologyandexpertisewithourotherofferings.ThegoodwillbalanceisdeductibleforU.S.incometaxpurposes.

Fiscal 2017 Business Combination

InMarch2016,weacquiredaproviderofaplatformfordatascienceandanalytics.Weconcludedthatthisacquisitionrelatestooursubscriptionoperatingsegmentandisaccountedforasabusinesscombination.Theestimatedpurchasepriceconsiderationtransferredwasapproximately$2.7millionincash.

Thefollowingtablesummarizestheestimatedfairvalueofassetsacquiredasofthedateofacquisition(dollarsinthousands):

Fair Value Estimated Useful Life

Developedtechnology $ 1,735 5yearsGoodwill 965 n/a

Netassetsacquired $ 2,700

Theexcessofpurchaseconsiderationoverthefairvalueoftheidentifiableintangibleassetacquiredwasrecordedasgoodwill.Thefairvalueassignedtoidentifiableintangibleassetswasbasedonmanagement’sestimatesandassumptions.

Theamountrecordedfordevelopedtechnologyrepresentstheestimatedfairvalueoftheacquiredcompany’sdatascienceandanalyticsplatformtechnology.Thegoodwillbalanceisprimarilyattributedtotheassembledworkforceandexpandedmarketopportunitieswhenintegratingtheacquiredcompany’sdatascienceandanalyticsplatformandexpertisewithourcurrentofferings.ThegoodwillbalanceisdeductibleforU.S.incometaxpurposes.

7. Commitments and Contingencies

Letters of Credit

AsofJanuary31,2016and2017andJuly31,2017,wehadatotalof$2.5million,$16.8millionand$19.9million,respectively,inlettersofcreditoutstandinginfavorofcertainlandlordsforofficespace.Theselettersofcreditrenewannuallyandexpireatvariousdatesthrough2027.

Operating Leases

Weleasefacilitiesspaceundernon‑cancelableoperatingleaseswithvariousexpirationdates.Futureminimumleasepaymentsandsubleaseproceedsundernon-cancelableoperatingleasesatJanuary31,2017areasfollows(inthousands):

YearEndingJanuary31:Minimum Lease

Payments Sublease Rental

Proceeds Net Minimum Lease

Payments

2018 $ 11,842 $ (5,321) $ 6,5212019 28,064 (9,284) 18,7802020 28,590 (9,560) 19,0302021 28,756 (9,845) 18,9112022 25,802 (10,141) 15,6612023andthereafter 142,966 (4,278) 138,688

Total $ 266,020 $ (48,429) $ 217,591

F-29

Futureminimumleasepaymentsandsubleaseproceedsundernon-cancelableoperatingleasesatJuly31,2017areasfollows(inthousands,byfiscalyear):

Minimum Lease

Payments Sublease Rental

Proceeds Net Minimum Lease

Payments (unaudited)Remainingsixmonthsoffiscal2018 $ 7,131 $ (5,361) $ 1,7702019 31,903 (13,295) 18,6082020 33,525 (13,693) 19,8322021 33,562 (14,101) 19,4612022 30,700 (10,861) 19,8392023andthereafter 159,884 (4,278) 155,606

Total $ 296,705 $ (61,589) $ 235,116

OnFebruary8,2017,weenteredintoanewsubleaseagreementtosubletofficespaceinPaloAlto,California.Thesubleasehasa45monthtermcommencinginthethirdquarteroffiscal2018.Rentalproceedscommittedunderthissubleasearereflectedaboveintheamountsof$1.6millioninfiscal2018,$4.0millioninfiscal2019,$4.1millioninfiscal2020,$4.3millioninfiscal2021and$0.7millioninfiscal2022.

InJune2017,weenteredintoanewnon‑cancelableoperatingleaseagreementtorentofficespaceinSanFrancisco,California.Theleasehasan87monthterm,commencesinJanuary2018andendsinApril2025withanoptiontorenewforanadditional60months.Totalminimumleasepaymentsundertheleaseagreement,includedinthetableabove,are$34.5million,ofwhich$0.4millionwasrequiredtobeprepaiduponexecutionoftheleaseagreement.

Rentalexpenserelatedtoournon‑cancelableoperatingleaseswasapproximately$7.2millionand$8.4millionfortheyearendedJanuary31,2016and2017,respectively,and$4.1millionand$5.7millionforthesixmonthsendedJuly31,2016and2017,respectively.

Deferred rent

Weaccountforoperatingleasescontainingpredeterminedfixedincreasesofthebaserentalrateduringtheleasetermonastraight‑linebasisovertheleaseterm.Werecordedthedifferencebetweenamountschargedtooperationsandamountspayableunderouroperatingleasesasdeferredrentintheconsolidatedbalancesheets.

Indemnification

Fromtimetotime,weenterintocertaintypesofcontractsthatcontingentlyrequireustoindemnifyvariouspartiesagainstclaimsfromthirdparties.Thesecontractsprimarilyrelateto(i)certainrealestateleasesunderwhichwemayberequiredtoindemnifypropertyownersforenvironmentalandotherliabilitiesandotherclaimsarisingfromouruseoftheapplicablepremises,(ii)ourbylaws,underwhichwemustindemnifydirectorsandexecutiveofficers,andmayindemnifyotherofficersandemployees,forliabilitiesarisingoutoftheirrelationshipwithus,(iii)contractsunderwhichwemustindemnifydirectorsandcertainofficersforliabilitiesarisingoutoftheirrelationshipwithus,(iv)contractsunderwhichwemayberequiredtoindemnifycustomersorpartnersagainstcertainclaims,includingclaimsfromthirdpartiesasserting,amongotherthings,infringementoftheirintellectualpropertyrights,and(v)procurement,consulting,orlicenseagreementsunderwhichwemayberequiredtoindemnifyvendors,consultantsorlicensorsforcertainclaims,includingclaimsthatmaybebroughtagainstthemarisingfromouractsoromissionswithrespecttothesuppliedproducts,technologyorservices.Fromtimetotime,wemayreceiveindemnificationclaimsunderthesecontractsinthenormalcourseofbusiness.Inaddition,underthesecontractswemayhavetomodifytheaccusedinfringingintellectualpropertyand/orrefundamountsreceived.

Intheeventthatoneormoreofthesemattersweretoresultinaclaimagainstus,anadverseoutcome,includingajudgmentorsettlement,maycauseamaterialadverseeffectonourfuturebusiness,operatingresultsorfinancial

F-30

condition.Itisnotpossibletodeterminethemaximumpotentialamountunderthesecontractsduetothelimitedhistoryofpriorindemnificationclaimsandtheuniquefactsandcircumstancesinvolvedineachparticularagreement.

Wemaintaindirectorandofficerinsurance,whichmaycovercertainliabilitiesarisingfromourobligationtoindemnifyourdirectorsandcertainofficers.

Todate,wehavenotincurredanymaterialcosts,andhavenotaccruedanyliabilitiesintheconsolidatedfinancialstatementsasaresultoftheseprovisions.

Contingencies

Intheordinarycourseofbusiness,weareormaybeinvolvedinavarietyoflitigationmatters,suits,investigations,andproceedings,includingactionswithrespecttointellectualpropertyclaims,governmentinvestigations,laborandemploymentclaims,breachofcontractclaims,tax,andothermatters.Regardlessoftheoutcome,theselitigationmatterscanhaveanadverseimpactonusbecauseofdefensecosts,diversionofmanagementresources,harmtoreputation,andotherfactors.Inaddition,itispossiblethatanunfavorableresolutionofoneormoresuchlitigationmatterscould,inthefuture,materiallyandadverselyaffectourfinancialposition,resultsofoperations,andcashflowsinaparticularperiodorsubjectustoaninjunctionthatcouldseriouslyharmourbusiness.

Werecordaprovisionforcontingentlosseswhenitisbothprobablethataliabilityhasbeenincurredandtheamountofthelosscanbereasonablyestimated.Withrespecttoouroutstandinglegalmattersmanagementbelievesthattheamountorestimablerangeofpossiblelosswillnot,eitherindividuallyorintheaggregate,haveamaterialadverseeffectonourbusiness,consolidatedfinancialposition,resultsofoperations,orcashflows.However,theoutcomeoflitigationisinherentlyuncertain.Therefore,ifoneormoreoftheselegalmatterswereresolvedagainstusforamountsinexcessofmanagement’sexpectations,ourresultsofoperationsandfinancialconditionincludinginaparticularreportingperiod,couldbemateriallyadverselyaffected.

8. Redeemable Convertible Preferred Stock

Theauthorized,issued,andoutstandingsharesofredeemableconvertiblepreferredstockasofJanuary31,2016and2017areasfollows(inthousands,exceptshares):

Shares Authorized,Issued

and Outstanding Aggregate Liquidation

Preference Net Carrying

Value

SeriesA 12,936,594 $ 5,000 $ 4,909SeriesB 12,314,006 6,000 5,945SeriesC 8,951,868 24,000 23,899SeriesD 8,965,178 40,000 39,902SeriesE 8,756,093 65,000 64,891SeriesF 10,989,008 160,000 155,039SeriesF-1 11,994,668 370,875 363,102

74,907,415 $ 670,875 $ 657,687

F-31

ImmediatelypriortotheclosingoftheIPO,onMay3,2017,all74,907,415sharesofourthen-outstandingredeemableconvertiblepreferredstockautomaticallyconvertedintosharesofcommonstockandwereclassified$657.7millionfromtemporaryequitytoadditionalpaidincapitalonourconsolidatedbalancesheet.

Theholdersofredeemableconvertiblepreferredstock,orpreferredstock,havevariousrightsandpreferencesasfollows:

Dividends

Theholdersofsharesofpreferredstockareentitledtoreceivedividendsattherateof8%perannumofthepreferredstockpricepershareoneachoutstandingshareofpreferredstock(asadjustedforanystockdividends,combinations,orsplitswithrespecttosuchshares).Dividendsarepayableinpreferenceandprioritytoanypaymentofanydividendonourcommonstock.Suchdividendsarepayableonlywhenandifdeclaredbytheboardofdirectors,butonlyoutoffundsthatarelegallyavailable,andarenon‑cumulative.Thereafter,anydividendsorothernon‑liquidatingdistributionbyustoourstockholdersshallbedistributedamongtheholdersofthesharesofcommonstockandpreferredstockonanasconvertedbasis.NodividendshavebeendeclaredthroughJanuary31,2017.

Conversion

Eachshareofpreferredstockisconvertible,attheoptionoftheholder,intoanumberoffullypaidandnon‑assessablesharesofcommonstockonaone‑for‑onebasis.Theconversionrateissubjecttoadjustmentfromtimetotimefortheeffectofastocksplit,stockdividend,orothersimilardistribution.Additionally,conversionisautomaticupontheclosingofaqualifiedpublicofferingofcommonstock,withnetproceedsofatleast$50.0millionaftercommissionsandunderwritingdiscounts.

Liquidation

Intheeventofourliquidation,sale,dissolution,orwindingup,whethervoluntaryorinvoluntary,theholdersofpreferredstockareentitledtoreceive,priorandinpreferencetoanydistributionofourassetstotheholdersofcommonstock,anamountequaltotheliquidationpreferencepershare,plusanydeclaredbutunpaiddividendswithrespecttosuchshares.Iftheproceedsarelessthantheliquidationamount,thepaymentswillbeallocatedtoeachSeriesinproportiontotherespectiveliquidationpreferenceamountsifpaidinfull.

Afterpaymenthasbeenmadetotheholdersofpreferredstockofthefullamountstowhichtheyareentitled,theholdersofcommonstockshallbeentitledtoreceiveourremainingassetsproratabasedonthenumberofsharesofcommonstockheldbyeachholder.

Voting

Theholdersofpreferredstockareentitledtoonevoteforeachshareofcommonstockthatwouldbeheld,onanas‑convertedbasis.Generally,preferredstockholdersvotewithcommonstockholdersasasingleclass.TheSeriesA,B,andF‑1preferredstockholders,eachasaseparateclass,electadirector.Thecommonstockholdersasaclasselecttwodirectors.Allotherdirectorsareelectedbyallstockholders,bothpreferredandcommon,votingtogetheronanas‑convertedbasis.

Redemption

Althoughourpreferredstockisnotmandatorilyorcurrentlyredeemable,theyareclassifiedoutsideofstockholders’deficitbecausetheyarepotentiallyredeemableuponcertaineventsoutsideofourcontrol,includingagreaterthan50%changeincontrolorourliquidation,sale,dissolution,orwindingup.Thecarryingvaluesofpreferredstockhavenotbeenaccretedtotheirredemptionvaluesastheseeventsarenotconsideredprobableofoccurrence.Subsequentadjustmentsofthecarryingvaluestoredemptionvalueswillbemadeonlyifandwhenitbecomesprobableredemptionwilloccur.

F-32

9. Common Stock

Thefollowingtablesummarizesourauthorized,issued,reservedandoutstandingcommonstockasofJanuary31,2017:

Authorized

Preferred Stock Preferred

Issued Common Reserved

Common Issued

Common Issued or Reserved for

Issuance

SeriesA 12,936,594 12,936,594 12,936,594 — 12,936,594SeriesB 12,314,006 12,314,006 12,314,006 — 12,314,006SeriesC 8,951,868 8,951,868 8,951,868 — 8,951,868SeriesD 8,965,178 8,965,178 8,965,178 — 8,965,178SeriesE 8,756,093 8,756,093 8,756,093 — 8,756,093SeriesF 10,989,008 10,989,008 10,989,008 — 10,989,008SeriesF-1 11,994,668 11,994,668 11,994,668 — 11,994,668Commonoutstanding — — — 38,156,688 38,156,6882008EquityIncentivePlan: Restrictedstockunitsandoptionsoutstanding — — 44,560,246 — 44,560,246

Sharesavailableforgrant — — 581,084 — 581,084AmendedandRestated2008StockPurchaseandOptionPlan(fromprioracquisition):

Optionsoutstanding — — 53,455 — 53,455Undesignated — — 1,741,112 — 1,741,112

74,907,415 74,907,415 121,843,312 38,156,688 160,000,000

Thefollowingtablesummarizesourauthorized,issued,reservedandoutstandingcommonstockasofJuly31,2017:

Common Reserved

Common Issued

Common Issued or Reserved for

Issuance (unaudited)Commonoutstanding — 131,250,336 131,250,3362017EquityIncentivePlan: Restrictedstockunitsandoptionsoutstanding 1,387,150 — 1,387,150Sharesavailableforgrant 29,848,932 — 29,848,932

2017EmployeeStockPurchasePlan: Sharesavailableforgrant 3,000,000 — 3,000,000

2008EquityIncentivePlan: Restrictedstockunitsandoptionsoutstanding 44,969,015 — 44,969,015

AmendedandRestated2008StockPurchaseandOptionPlan(fromprioracquisition):

Optionsoutstanding 53,225 — 53,225Undesignated 989,491,342 — 989,491,342

1,068,749,664 131,250,336 1,200,000,000

F-33

10. Stock Option Plans

Wemaintaintwoshare-basedcompensationplans:the2017EquityIncentivePlan(2017Plan),andthe2008EquityIncentivePlan(2008Plan)andcollectivelywiththe2017Plan,theStockPlans.InMarch2017,ourboardofdirectorsadoptedour2017Plan,whichourstockholdersapprovedinMarch2017.The2017PlanbecameeffectiveonApril27,2017,theeffectivedateofourIPO,andservesasthesuccessortoour2008Plan.Wedonotexpecttograntanyadditionalawardsunderthe2008Plan.Outstandingawardsunderthe2008Plancontinuetobesubjecttothetermsandconditionsofthe2008Plan.

InMarch2017,weincreasedthenumberofsharesofcommonstockreservedforgrantunderthe2008Planby2,000,000shares.

InMarch2017,weadoptedthe2017Planwithareserveof30,000,000sharesofourcommonstockforissuanceunderour2017Plan,plusanadditionalnumberofsharesofcommonstockequaltoanysharesreservedbutnotissuedorsubjecttooutstandingawardsunderour2008Planontheeffectivedateofour2017Plan,plus,onandaftertheeffectivedateofour2017Plan,(i)sharesthataresubjecttooutstandingawardsunderthe2008Planwhichceasetobesubjecttosuchawards,(ii)sharesissuedunderthe2008Planwhichareforfeitedorrepurchasedattheiroriginalissueprice,and(iii)sharessubjecttoawardsunderthe2008Planthatareusedtopaytheexercisepriceofanoptionorwithheldtosatisfythetaxwithholdingobligationsrelatedtoanyaward.Thenumberofsharesreservedforissuanceunderour2017PlanwillincreaseautomaticallyonthefirstdayofFebruaryofeachcalendaryearduringthetermofthe2017Planbyanumberofsharesofcommonstockequaltothelesserof(i)5%ofthetotaloutstandingsharesourcommonstockasoftheimmediatelyprecedingJanuary31stor(ii)anumberofsharesdeterminedbyourboardofdirectors.

AsofJuly31,2017thereare79,258,322,sharesofcommonstockwerereservedandavailableforfutureissuanceunderthetheStockPlans.

TheStockPlansprovidesforstockoptionstobegrantedatanexercisepricenotlessthan100%ofthefairmarketvalueatthegrantdateasdeterminedbyourboardofdirectors,unless,withrespecttoincentivestockoptions,theoptioneeisa10%stockholder,inwhichcasetheoptionpricewillnotbelessthan110%ofsuchfairmarketvalue.Optionsgrantedgenerallyhaveamaximumtermoftenyearsfromthegrantdate,areexercisableuponvestingunlessotherwisedesignatedforearlyexercisebytheboardofdirectorsatthetimeofgrant,andgenerallyvestoverafouryearperiod,with25%vestingafteroneyearandthenratablyonamonthlybasisfortheremainingthreeyears.

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Thefollowingtablessummarizestockoptionactivityandrelatedinformation:

Options Outstanding

Shares Available for Grant

Options Outstanding

Weighted- Average Exercise

Price

Weighted-AverageRemaining Contractual

Term (Years)

Aggregate Intrinsic

Value

(in thousands)Balance—January31,2015 1,017,709 30,848,554 $ 3.59 — —

Additionalsharesreserved 5,858,469 — — — —Restrictedstockactivity,net (6,749,712) — — — —Granted (1,318,890) 1,318,890 17.94 — —Exercised — (5,838,389) 1.87 — —Canceled 1,493,769 (1,493,769) 6.28 — —Sharesinlieuoftaxes 36,206 — — — Plansharesexpired (854) — — —

Balance—January31,2016 336,697 24,835,286 4.60 6.9 $ 497,338Additionalsharesreserved 10,001,250 — — — —Restrictedstockactivity,net (10,193,963) — — — Granted (370,480) 370,480 17.85 — —Exercised (1,157,625) 3.10 — —Canceled 808,462 (808,462) 10.74 — —Plansharesexpired (882) — — —

Balance—January31,2017 581,084 23,239,679 $ 4.67 6.0 $ 319,016Additionalsharesreserved(unaudited) 32,000,000 — — — —Restrictedstockactivity,net(unaudited) (2,865,041) — — — Granted(unaudited) (39,300) 39,300 20.67 — —Exercised(unaudited) (895,118) 2.31 — —Canceled(unaudited) 172,419 (172,419) 12.30 — —Plansharesexpired(unaudited) (230) — — —

Balance—July31,2017(unaudited) 29,848,932 22,211,442 $ 4.73 5.4 $ 279,685

Exercisable—January31,2017 19,434,627 $ 3.61 5.7 $ 286,994

Vestedorexpectedtovest—January31,2017 22,975,081 $ 4.56 5.9 $ 317,798

Exercisable—July31,2017(unaudited) 20,312,954 $ 3.86 5.2 $ 272,663Vestedorexpectedtovest—July31,2017(unaudited) 22,211,442 $ 4.73 5.4 $ 279,685

AsofJanuary31,2016and2017andJuly31,2017,therewerenounvestedoptionsexercisable.

ThetotalintrinsicvalueofoptionsexercisedduringtheyearsendedJanuary31,2016and2017was$160.0millionand$18.3million,respectively,andduringthesixmonthsendedJuly31,2016and2017was$12.4millionand$12.2million,respectively.Theintrinsicvalueisthedifferencebetweenthecurrentfairmarketvalueof

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thestockforaccountingpurposesatthetimeofexerciseandtheexercisepriceofthestockoption.Aswehaveaccumulatednetoperatinglosses,nofuturetaxbenefitrelatedtooptionexerciseshasbeenrecognized.

Theweighted‑averagegrant‑datevalueofemployeeoptionsgrantedduringtheyearsendedJanuary31,2016and2017was$15.54and$9.37persharefor,respectively,andforthesixmonthsendedJuly31,2016and2017was$10.24and$8.83,respectively.Thevalueofemployeeoptionsforstock‑basedcompensationexpensepurposesisestimatedatthegrantdateusingtheBlack‑Scholesoption‑pricingmodelwiththefollowingweighted‑averageassumptions:



2016 2017 2016 2017

Volatility 44.3% 47.9% 47.9% 45.5%Risk-freeinterestrate 1.7% 2.0% 1.4% 2.0%Expectedterm(inyears) 6.1years 6.0years 6.0years 6.1yearsExpecteddividends —% —% —% —%

Theunamortizedstock‑basedcompensationexpenseforoptionsof$27.3millionand$18.5millionatJanuary31,2017andJuly31,2017,respectively,willberecognizedovertheaverageremainingvestingperiodof1.5yearsand1.7years,respectively.

WeissueRSUstoemployeesanddirectors.Fornewemployeegrants,theRSUsgenerallymeettheservice‑basedconditionoverafour-yearperiod,with25%metafteroneyearandthenratablyonaquarterlybasisfortheremainingthreeyears.Forcontinuingemployeegrants,theRSUsgenerallymeettheservice‑basedconditionpro‑rataquarterlyoverthefour‑yearperiod(withoutaone‑yearcliff).

TheemployeeRSUsissuedpriortoourIPOunderthe2008Planhavetwovestingconditions:(1)aservice‑basedconditionand(2)aliquidityevent‑relatedperformanceconditionwhichisconsideredaperformance‑basedcondition.OnMarch8,2017,ourboardofdirectorsmodifiedthetermsofthemajorityofourRSUs.Priortothemodification,iftheliquidityevent‑relatedperformanceconditionwasanIPO,employeeswererequiredtocontinuetoprovideserviceforsixmonthsfollowingtheeffectivedateofanIPO.Themodificationremovedtherequirement,forthemajorityofRSUs,thattheRSUrecipientmustcontinuetoprovideserviceforsixmonthsfollowingtheeffectivedateofanIPOinordertovestintheaward,withsuchsharestobeissuedonadatetobedeterminedbyourboardofdirectors.AllothersignificanttermsoftheRSUsremainedunchanged.ThemodificationestablishedanewmeasurementdateforthesemodifiedRSUs.

Theliquidityevent‑relatedperformanceconditionwasachievedforthemajorityofourRSUsandbecameprobableofbeingachievedfortheremainingRSUsonApril27,2017,theeffectivedateofourIPO.Werecognizedstock‑basedcompensationexpenseusingtheacceleratedattributionmethodwithacumulativecatch‑upofstock‑basedcompensationexpenseintheamountof$181.5millionforthesixmonthsendedJuly31,2017,attributabletoservicepriortosucheffectivedate.

ThetotalfairvalueofRSUsvestedandconvertedtoshareswas$22.5millionand$1.0millionfortheyearsendedJanuary31,2016and2017,respectively,and$0.5millionand$0.7millionforthesixmonthsendedJuly31,2016and2017,respectively.

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Restrictedstockactivityisasfollows:

Restricted Stock Units Outstanding

Number of Restricted Stock Units

Weighted- Average

Grant Date Fair Value Per Share

Balance—January31,2015 5,278,205 $ 25.80Granted 7,559,269 26.16Canceled (809,557) 23.99Vestedandconvertedtoshares (799,552) 25.82

Balance—January31,2016 11,228,365 26.17Granted 12,152,584 19.25Canceled (1,958,621) 25.03Vestedandconvertedtoshares (48,306) 24.85

Balance—January31,2017 21,374,022 22.36Granted(unaudited) 3,531,520 16.55Canceled(unaudited) (666,479) 16.43Vestedandconvertedtoshares(unaudited) (41,115 ) 22.38

Balance—July31,2017(unaudited) 24,197,948 $ 15.25

ThenumberofRSUsoutstandingatJuly31,2017inthetableaboveincludes6,025,651sharesofcommonstocksubjecttoRSUsthatvesteduponorsubsequenttotheeffectivedateofourIPOandwillbeissuedonadatetobedeterminedbyourboardofdirectors.

Theunamortizedstock‑basedcompensationexpenseforRSUswas$477.0millionatJanuary31,2017.Thisunamortizedstock‑basedcompensationexpenserelatestotheexpenseassociatedwiththeemployeeRSUsbecausetherewasaperformance‑basedrequirementforvesting.Theunamortizedstock‑basedcompensationexpenseforRSUsof$153.2millionatJuly31,2017willberecognizedovertheaverageremainingvestingperiodof1.6years.

InMay2015,anunrelatedthirdpartyinitiatedacashtenderofferwhichwascompletedinJuly2015forthepurchaseofsharesofourcommonstockfromspecifiedcategoriesofcurrentandformeremployeeswhosoldatotalof4,079,131sharesofourcommonstocktotheunrelatedthirdparty.Thepurchasepricepershareinthetenderofferwasinexcessofthefairvalueofourcommonstockatthetimeofthetransactionandaccordingly,uponcompletionofthetransaction,werecorded$16.6millionasstock‑basedcompensationexpenserelatedtotheexcessofthesellingpricepershareofcommonstockpaidtoouremployeesoverthefairvalueofthetenderedshares.

Thistenderofferwasaqualifyingliquidityeventunderthe2008PlangoverningRSUs,meaningtheperformanceconditionwasachievedforthoseRSUsthathadmettheservice‑basedconditionasofthisdate.Uponthecloseofthetransaction,werecorded$19.7millionofstock‑basedcompensationexpense,usingtheacceleratedattributionmethod,fortheRSUsforwhichbothvestingconditionshadbeenachieved.

2017 Employee Stock Purchase Plan

InMarch2017,weadoptedour2017EmployeeStockPurchasePlan(ESPP).TheESPPbecameeffectiveonApril27,2017,theeffectivedateofourIPO.OurESPPisintendedtoqualifyasanemployeestockpurchaseplanunderSection423oftheUnitedStatesInternalRevenueCodeof1986,asamended(Code).Purchaseswillbeaccomplishedthroughparticipationindiscreteofferingperiods.ThefirstofferingperiodandpurchaseperiodbeganonApril27,2017andwillendonDecember20,2017(orsuchotherdatedeterminedbyourboardofdirectorsorourcompensationcommittee).Eachsubsequentofferingperiodwillbeforsixmonths(commencingeachJune21andDecember21)andwillconsistofonesix‑monthpurchaseperiod,unlessotherwisedeterminedbyourboardofdirectorsorourcompensationcommittee.

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UnderourESPP,eligibleemployeeswillbeabletoacquiresharesofourcommonstockbyaccumulatingfundsthroughpayrolldeductions.OuremployeesgenerallyareeligibletoparticipateinourESPPiftheyareemployedbyusforatleast20hoursperweekandmorethanfivemonthsinacalendaryear.Employeeswhoare5%stockholders,orwouldbecome5%stockholdersasaresultoftheirparticipationinourESPP,areineligibletoparticipateinourESPP.Wemayimposeadditionalrestrictionsoneligibility.Oureligibleemployeesareabletoselectarateofpayrolldeductionbetween1%and15%oftheirbasecashcompensation.ThepurchasepriceforsharesofourcommonstockpurchasedunderourESPPis85%ofthelesserofthefairmarketvalueofourcommonstockon(i)thefirsttradingdayoftheapplicableofferingperiodand(ii)thelasttradingdayofeachpurchaseperiodintheapplicableofferingperiod.Noparticipanthastherighttopurchasesharesofourcommonstockinanamount,whenaggregatedwithpurchaserightsunderallouremployeestockpurchaseplansthatarealsoineffectinthesamecalendaryear(s),thathasafairmarketvalueofmorethan$25,000,determinedasofthefirstdayoftheapplicablepurchaseperiod,foreachcalendaryearinwhichthatrightisoutstanding.Inaddition,noparticipantispermittedtopurchasemorethan2,500sharesduringanyonepurchaseperiodorsuchlesseramountdeterminedbyourcompensationcommitteeorourboardofdirectors.OnceanemployeeisenrolledinourESPP,participationwillbeautomaticinsubsequentofferingperiods.Anemployee’sparticipationautomaticallyendsuponterminationofemploymentforanyreason.

Weinitiallyreserved3,000,000sharesofourcommonstockforissuanceunderourESPP.ThenumberofsharesreservedforissuanceunderourESPPwillincreaseautomaticallyonFebruary1stofeachofthefirst10calendaryearsfollowingthefirstofferingdatebythenumberofsharesequaltothelesserofeither(i)1%ofthetotaloutstandingsharesofourcommonstockasoftheimmediatelyprecedingJanuary31st(roundedtothenearestwholeshare)or(ii)anumberofsharesofourcommonstockdeterminedbyourboardofdirectors.AsofJuly31,2017,$3.9millionhasbeenwithheldonbehalfofemployeesforafuturepurchaseundertheESPPandisrecordedinotheraccruedcompensation.

11. Income taxes

Thedomesticandforeigncomponentsoflossbeforeprovisionforincometaxesconsistedofthefollowing(inthousands):


2016 2017

Domestic $ (204,713) $ (187,905)Foreign 2,680 2,775

Netlossbeforeincometaxes $ (202,033) $ (185,130)

Thecomponentsofprovisionforincometaxesareasfollows(inthousands):


2016 2017

Current: Federal $ — $ —State (177) (140)Foreign (940) (2,011)

Totalcurrenttaxexpense (1,117) (2,151)Deferred: Federal — (108)State — —Foreign 7 72

Totaldeferredtaxexpense 7 (36)Totalprovisionforincometaxes $ (1,110) $ (2,187)

F-38

Oureffectivetaxratesubstantiallydifferedfromthefederalstatutorytaxrateof34%primarilyduetothechangeinthevaluationallowanceforourdeferredtaxassets.Areconciliationofincometaxesatthestatutoryfederalincometaxratetotheprovisionforincometaxesincludedintheconsolidatedstatementsofoperationsisasfollows(inthousands):


2016 2017

U.S.federalstatutoryincometaxat34% $ 68,691 $ 62,944Researchtaxcredits 1,605 2,235Stock-basedcompensation (11,060) (4,340)Changeinvaluationallowance (60,318) (54,823)DonationofcommonstocktotheClouderaFoundation — (7,335)Other (28) (868)

Provisionforincometaxes $ (1,110) $ (2,187)

Thedeferredtaxassetsandliabilitieswereasfollows(inthousands):

As of

January 31,

2016 2017

Deferredtaxassets: Accrualsandreserves $ 9,076 $ 12,282Deferredrevenue 19,978 26,509Netoperatinglosscarryforward 124,302 165,873Researchanddevelopmentcreditsandothercredits 7,718 12,009Stock-basedcompensation 7,308 9,923Grossdeferredtaxassets 168,382 226,596

Lessvaluationallowance (165,536) (225,495)Totaldeferredtaxassets 2,846 1,101

Deferredtaxliabilities: Depreciationandamortization (2,689) (872)

Grossdeferredtaxliabilities (2,689) (872)

Netdeferredtaxassets $ 157 $ 229

WehavenotrecordedaprovisionfordeferredUnitedStatestaxexpenserelatedto$3.1millionand$4.8millionofourundistributedearningsofourforeignsubsidiariesasofJanuary31,2016and2017,respectively,becausetheseearningsareintendedtobepermanentlyreinvestedinoperationsoutsideoftheUnitedStates.Wehavedeterminedtheunrecognizeddeferredtaxliabilitiesassociatedwiththeseearningsarenotmaterial.

Avaluationallowanceisprovidedwhenitismorelikelythannotthatthedeferredtaxassetswillnotberealized.WehaveestablishedavaluationallowancetooffsetnetdeferredtaxassetsatJanuary31,2016and2017duetotheuncertaintyofrealizingfuturetaxbenefitsfromournetoperatinglosscarryforwardsandotherdeferredtaxassets.ThenetchangeinthetotalvaluationallowancefortheyearsendedJanuary31,2016and2017wasanincreaseofapproximately$66.6millionand$60.0million,respectively.

AtJanuary31,2017,wehavefederal,Californiaandotherstatenetoperatinglosscarryforwardsofapproximately$586.2million,$188.4millionand$179.0million,respectively,expiringbeginningfiscal2029,forfederalandCaliforniapurposesandfiscal2019forotherstates’purposes.

F-39

Theexcesstaxbenefitsassociatedwithstockoptionexercisesarerecordeddirectlytostockholders’equityonlywhensuchbenefitsarerealizedfollowingthetaxlaworderingapproach.Asaresult,theexcesstaxbenefitsincludedinnetoperatinglosscarryforwardsbutnotreflectedindeferredtaxassetsforfiscal2017are$53.5million.Theexcesstaxbenefitassociatedwithstockoptionexerciseswillonlyberecordedtoequitywhentheyreducecashtaxespayable.

AtJanuary31,2017,wehavefederalandstateresearchcreditcarryforwardsofapproximately$11.6millionand$10.6million,respectively,expiringbeginningincalendaryear2029forfederalpurposes.Thestatecreditscanbecarriedforwardindefinitely.

FederalandstatetaxlawsmayimposesubstantialrestrictionsontheutilizationofthenetoperatinglossandcreditcarryforwardattributesintheeventofanownershipchangeasdefinedinSection382oftheInternalRevenueCode.Accordingly,ourabilitytoutilizethesecarryforwardsmaybelimitedasaresultofsuchoneormoreownershipchanges.Suchalimitationcouldresultintheexpirationofcarryforwardsbeforetheyareutilized.Thecompanyhasperformedananalysistodeterminewhetheranownershipchangehasoccurredsinceinception.Theanalysisidentifiedtwohistoricalownershipchanges,howeverthelimitationsdidnotresultinamaterialrestrictionontheuseofourcarryforwards.Intheeventweexperienceanysubsequentchangesinownership,theavailabilityofourcarryforwardsinanytaxableyearcouldchange.

Forbenefitstoberecorded,ataxpositionmustbemorelikelythannottobesustaineduponexamination.Theamountrecognizedismeasuredasthelargestamountofbenefitthatisgreaterthan50%likelyofbeingrealizeduponsettlement.Thefollowingtablereflectsthechangesinthegrossunrecognizedtaxbenefits(inthousands):


2016 2017

Balanceasofbeginningofyear $ 4,200 $ 6,500Taxpositionstakenincurrentperiod Grossincreases 2,300 3,100

Balanceasofendofyear $ 6,500 $ 9,600

Werecognizeinterestandpenaltiesrelatedtoincometaxmattersintheprovisionforincometaxes.AsofJanuary31,2017,wehadnoaccruedinterestandpenaltiesrelatedtouncertaintaxpositions.WearesubjecttotaxesintheUnitedStatesandotherforeignjurisdictions.Inthenormalcourseofbusiness,wearesubjecttoexaminationbyvariousfederal,stateandlocaltaxingauthorities.WearenotcurrentlyunderauditbytheInternalRevenueServiceoranyothertaxauthority.Alltaxyearsremainopentoexaminationbymajortaxingjurisdictionsinwhichwefilereturns.

Ourquarterlyincometaxesreflectanestimateofourcorrespondingyear’sannualeffectivetaxrateandinclude,whenapplicable,adjustmentsfordiscreteitems.ForthesixmonthsendedJuly31,2017,ourtaxprovisionwas$1.5million,comparedto$1.0millionforthesameperiodayearago.ThetaxprovisionforthesixmonthsendedJuly31,2017primarilyrelatestoincometaxesofournon-U.S.operationsasourU.S.operationswereinalosspositionandwemaintainafullvaluationallowanceagainstourU.S.deferredtaxassets.

12. Related Party Transactions

Intel Corporation

WehavebeenengagedincommercialtransactionswithIntelCorporation,aholderofourcommonstock,representingapproximately22%and20%ofoutstandingsharesasofJanuary31,2017andJuly31,2017,withtherighttodesignateapersonthatourboardofdirectorsmustnominateforelection,ornominateforre-election,toourboardofdirectors,includingamulti‑yearsubscriptionandservicesagreement,andacollaborationandoptimizationagreement.Theaggregaterevenuewerecognizedfromthiscustomerwas$5.4millionand$8.3millionfortheyearsendedJanuary31,2016and2017,respectively,and$3.9millionand$5.3millionforthesixmonthsendedJuly31,2016and2017,respectively.Therewas$1.5million,$2.3millionand$3.0millioninaccountsreceivableduefrom

F-40

thiscustomerasofJanuary31,2016and2017andJuly31,2017,respectively.Therewas$1.5million,$2.1millionand$2.8millionindeferredrevenueasofJanuary31,2016and2017andJuly31,2017,respectively.

Cloudera Foundation

InJanuary2017,theClouderaFoundation,anindependentnon‑profitorganization,wascreatedtoprovideourproducts,skillsandpeople,tohelpsolveimportantsocialproblemsaroundtheworld.Wedonated1,175,063sharesofourcommonstocktotheClouderaFoundationduringthefourthquarteroffiscal2017.Werecordedanon‑cashchargeof$21.6millionforthefairvalueofthedonatedshares,whichwasrecordedingeneralandadministrativeexpenseintheaccompanyingconsolidatedstatementsofoperations.InconjunctionwiththeIPO,wedonated$2.4million,or1%ofthenetproceeds,tofundtheClouderaFoundation’sactivities.WedonotcontroltheClouderaFoundation’sactivities,andaccordingly,wedonotconsolidatethefinancialstatementsoftheClouderaFoundation.

Other related parties

Certainmembersofourboardofdirectorscurrentlyserveontheboardofdirectorsorasanexecutiveoftwocompaniesthatareourcustomers.Theaggregaterevenuewerecognizedfromthesecustomerswas$2.4millionand$5.5millionfortheyearsendedJanuary31,2016and2017,respectively,and$2.1millionand$3.4millionforthesixmonthsendedJuly31,2016and2017,respectively.Therewas$1.0million,$4.5millionand$0.6millioninaccountsreceivableduefromthesecustomersasofJanuary31,2016and2017andJuly31,2017,respectively.Therewas$3.0million,$5.5millionand$5.7millionindeferredrevenueasofJanuary31,2016and2017andJuly31,2017,respectively.

13. Segment Information

TheresultsofthereportablesegmentsarederiveddirectlyfromourmanagementreportingsystemandarebasedonourmethodsofinternalreportingwhicharenotnecessarilyinconformitywithGAAP.Managementmeasurestheperformanceofeachsegmentbasedonseveralmetrics,includingcontributionmargin,asdefinedbelow.Managementdoesnotuseassetinformationtoassessperformanceandmakedecisionsregardingallocationofresources.Therefore,depreciationandamortizationexpenseisnotallocatedamongsegments.

Contributionmarginisused,inpart,toevaluatetheperformanceof,andallocateresourcesto,eachofthesegments.Segmentcontributionmarginincludessegmentrevenuelesstherelatedcostofsalesexcludingcertainoperatingexpensesthatarenotallocatedtosegmentsbecausetheyareseparatelymanagedattheconsolidatedcorporatelevel.Theseunallocatedcostsincludestock‑basedcompensationexpense,amortizationofacquiredintangibleassets,directsalesandmarketingcosts,researchanddevelopmentcosts,corporategeneralandadministrativecosts,suchaslegalandaccounting,interestincome,interestexpense,andotherincome(expense).

Financialinformationforeachreportablesegmentwasasfollows(inthousands):



2016 2017 2016 2017

(unaudited)Revenue:


Totalrevenue $ 166,048 $ 261,026 $ 120,941 $ 169,424

F-41



2016 2017 2016 2017

(unaudited)Contributionmargin:


Totalsegmentcontributionmargin $ 100,081 $ 179,264 $ 81,175 $ 121,986

Thereconciliationofsegmentfinancialinformationtoourlossfromoperationsisasfollows(inthousands):



2016 2017 2016 2017

(unaudited)Segmentcontributionmargin $ 100,081 $ 179,264 $ 81,175 $ 121,986Amortizationofacquiredintangibleassets (3,455) (3,720) (1,830) (1,885)Stock-basedcompensationexpense (63,590) (21,714) (11,241) (230,533)DonationofcommonstocktotheClouderaFoundation — (21,574) — —Corporatecosts,suchasresearchanddevelopment,corporategeneralandadministrativeandother (237,673) (319,595) (150,407) (177,593)

Lossfromoperations $ (204,637) $ (187,339) $ (82,303) $ (288,025)

SalesoutsideoftheUnitedStatesrepresentedapproximately21%,and25%ofourtotalrevenuefortheyearsendedJanuary31,2016and2017,respectively,and24%and27%forthesixmonthsendedJuly31,2016and2017,respectively.Allrevenuesfromexternalcustomersareattributedtoindividualcountriesonanend‑customerbasis,basedondomicileofthepurchasingentity,ifknown,orthelocationofthecustomer’sheadquartersifthespecificpurchasingentitywithinthecustomerisunknown.

AsofJanuary31,2016andJanuary31,2017andJuly31,2017,assetslocatedoutsidetheUnitedStateswere1%,3%and2%oftotalassets,respectively.

14. Net Loss Per Share Attributable to Common Stockholders

Thefollowingtablesetsforththecalculationofbasicanddilutednetlosspershareattributabletocommonstockholdersduringtheperiodspresented(inthousands,exceptpersharedata):



2016 2017 2016 2017

(unaudited)Numerator: Netloss $ (203,143) $ (187,317) $ (81,840) $ (286,548)

Denominator: Weighted-averagesharesusedincomputingnetlossattributabletocommonstockholders,basicanddiluted 32,724 36,406 36,090 87,293

Netlosspershareattributabletocommonstockholders,basicanddiluted $ (6.21) $ (5.15) $ (2.27) $ (3.28)

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Thefollowingoutstandingsharesofcommonstockequivalentswereexcludedfromthecomputationofthedilutednetlosspershareattributabletocommonstockholdersfortheperiodspresentedbecausetheireffectwouldhavebeenanti‑dilutive(inthousands):

As of

January 31, As of July 31,

2016 2017 2016 2017

(unaudited)Redeemableconvertiblepreferredstockonanas-ifconvertedbasis 74,907 74,907 74,907 —Stockoptionstopurchasecommonstock 24,835 23,240 23,819 22,211Restrictedstockunits 11,228 21,374 14,017 18,172SharesissuablepursuanttotheESPP — — — 1,004

Total 110,971 119,521 112,744 41,388

15. Subsequent Events

InpreparingtheconsolidatedfinancialstatementsasofJanuary31,2017andfortheyearthenended,weevaluatedsubsequenteventsforrecognitionandmeasurementpurposesthroughMarch31,2017,thedatetheindependentauditors’reportwasoriginallyissuedandtheauditedannualconsolidatedfinancialstatementswereavailableforissuance.

16. Subsequent Events (unaudited)

InSeptember2017,weacquiredFastForwardLabs,aleadingmachinelearningandappliedartificialintelligenceresearchcompanybasedinNewYork.Thisacquisitionwillbeaccountedforasabusinesscombination.Theestimatedpurchasepriceisnotmaterial.

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