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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 2022
OR
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission file number 001-39004
ChargePoint Holdings, Inc.
(Exact name of registrant as specified in its charter)
Delaware84-1747686
(State or other jurisdiction of incorporation or organization)(IRS Employer
Identification No.)
240 East Hacienda Avenue Campbell, CA
95008
(Address of principal executive offices)(Zip Code)
(408) 841-4500
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class             Trading Symbol(s)        Name of each exchange on which registered

Common Stock, par value $0.0001              CHPT                 New York Stock Exchange



Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days.    Yes  x   No  o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x   No  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerxAccelerated filero
Non-accelerated filer
o
Smaller reporting company
o

Emerging growth company
o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes   o     No  x

The registrant had outstanding 339,867,655 shares of common stock as of August 31, 2022.


CHARGEPOINT HOLDINGS, INC.
Table of Contents
2

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q (this “Quarterly Report”) includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of present or historical fact included in this Quarterly Report, regarding the future financial performance of ChargePoint Holdings, Inc. (“ChargePoint” or the “Company”), as well as ChargePoint’s strategy, future operations, future operating results, financial position, expectations regarding revenue, losses, and costs, margins, prospects, plans and objectives of management are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “continue,” “project” or the negative of such terms and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements are based on various assumptions, whether or not identified herein, and on the current expectations of ChargePoint’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of, fact or probability. Actual events and circumstances are difficult or impossible to predict and may differ from assumptions, and such differences may be material. Many actual events and circumstances are beyond the control of ChargePoint. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about ChargePoint that may cause the actual results, level of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. If any of these risks materialize or ChargePoint’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that ChargePoint does not presently know or that ChargePoint currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect ChargePoint’s expectations, plans or forecasts of future events and views as of the date hereof. ChargePoint anticipates that subsequent events and developments will cause ChargePoint’s assessments to change. These forward-looking statements should not be relied upon as representing ChargePoint’s assessments as of any date subsequent to the date hereof. Accordingly, undue reliance should not be placed upon the forward-looking statements. ChargePoint cautions you that these forward-looking statements are subject to numerous risk and uncertainties, most of which are all difficult to predict and many of which are beyond the control of ChargePoint.
The following factors, among others, could cause actual results to differ materially from forward-looking statements:
ChargePoint’s success in retaining or recruiting, or changes in, its officers, key employees or directors;
changes in applicable laws or regulations;
the impact of the coronavirus (“COVID-19”) pandemic on the overall economy and ChargePoint’s results of operations, financial position and cash flows;
supply chain disruptions, delays, component shortages and expense increases, including those contributed by the ongoing COVID-19 pandemic and conflict between Ukraine and Russia may adversely affect our sales, revenue and gross margins;
delays in new product introductions;
ChargePoint’s ability to expand its business in Europe;
ChargePoint’s ability to integrate newly acquired assets and businesses into ChargePoint’s own business and the expected benefits from newly acquired assets to ChargePoint, its customers and its market position;
the electric vehicle (“EV”) market may not grow as expected;
ChargePoint may not attract a sufficient number of fleet owners or operators as customers;
incentives from governments or utilities may not materialize or may be reduced, which could reduce demand for EVs, or the portion of regulatory credits that customers claim may increase, which would reduce ChargePoint’s revenue from this source;
3

the impact of competing technologies or technological changes could reduce the demand for EVs or otherwise adversely affect the EV market or our business;
data security breaches or other network outages;
ChargePoint’s ability to remediate its material weaknesses in internal control over financial reporting; and
the possibility that ChargePoint may be adversely affected by other economic factors including macroeconomic conditions such as inflation, other business factors or other competitive factors.
The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other risk factors included herein. Forward-looking statements reflect current views about ChargePoint’s plans, strategies and prospects, which are based on information available as of the date of this Quarterly Report. Except to the extent required by applicable law, ChargePoint undertakes no obligation (and expressly disclaims any such obligation) to update or revise the forward-looking statements whether as a result of new information, future events or otherwise.

4


ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

5


ChargePoint Holdings, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data, unaudited)
July 31,
2022
January 31,
2022
Assets
Current assets:
Cash and cash equivalents$187,662 $315,235 
Restricted cash400 400 
Short-term investments283,880  
Accounts receivable, net of allowance of $6,731 as of July 31, 2022 and $5,584 as of January 31, 2022
109,922 75,939 
Inventories53,420 35,879 
Prepaid expenses and other current assets44,902 36,603 
Total current assets680,186 464,056 
Property and equipment, net36,699 34,593 
Intangible assets, net94,482 107,209 
Operating lease right-of-use assets22,571 25,535 
Goodwill205,580 218,484 
Other assets6,512 6,020 
Total assets$1,046,030 $855,897 
Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable45,145 27,576 
Accrued and other current liabilities110,096 84,328 
Deferred revenue83,529 77,142 
Total current liabilities238,770 189,046 
Deferred revenue, noncurrent84,052 69,666 
Debt, noncurrent294,334  
Operating lease liabilities22,727 25,370 
Deferred tax liabilities13,383 17,697 
Other long-term liabilities1,075 7,104 
Total liabilities654,341 308,883 
Commitments and contingencies (Note 9)
Stockholders’ equity (deficit):
Common stock: $0.0001 par value; 1,000,000,000 shares authorized as of July 31, 2022 and January 31, 2022; 338,820,463 and 334,760,615 shares issued and outstanding as of July 31, 2022 and January 31, 2022, respectively
34 33 
Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of July 31, 2022 and January 31, 2022; 0 issued and outstanding as of July 31, 2022 and January 31, 2022
  
Additional paid-in capital1,414,301 1,366,855 
Accumulated other comprehensive loss(29,025)(8,219)
Accumulated deficit(993,621)(811,655)
Total stockholders’ equity391,689 547,014 
Total liabilities and stockholders’ equity$1,046,030 $855,897 
    
The accompanying notes are an integral part of these condensed consolidated financial statements.
6


ChargePoint Holdings, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except share and per share data, unaudited)
Three Months Ended
July 31
Six Months Ended
July 31,
2022202120222021
Revenue
Networked charging systems$84,148 $40,874 $143,699 $67,674 
Subscriptions20,244 12,082 37,890 22,906 
Other3,900 3,165 8,336 6,051 
Total revenue108,292 56,121 189,925 96,631 
Cost of revenue
Networked charging systems74,352 35,384 130,618 59,126 
Subscriptions13,278 7,830 23,905 13,470 
Other2,509 2,130 5,142 4,041 
Total cost of revenue90,139 45,344 159,665 76,637 
Gross profit18,153 10,777 30,260 19,994 
Operating expenses
Research and development51,804 40,410 100,105 65,784 
Sales and marketing33,873 21,923 66,460 37,897 
General and administrative22,846 22,732 43,893 37,199 
Total operating expenses108,523 85,065 210,458 140,880 
Loss from operations(90,370)(74,288)(180,198)(120,886)
Interest income1,460 25 1,566 47 
Interest expense(2,928) (3,862)(1,499)
Change in fair value of redeemable convertible preferred stock warrant liability   9,237 
Change in fair value of common stock warrant liabilities (10,421)(24)33,340 
Change in fair value of contingent earnout liability   84,420 
Transaction costs expensed   (7,031)
Other (expense) income, net(1,254)(189)(1,702)(174)
Net loss before income taxes(93,092)(84,873)(184,220)(2,546)
Provision for (benefit from) income taxes(392)65 (2,254)103 
Net loss$(92,700)$(84,938)$(181,966)$(2,649)
Cumulative dividends on redeemable convertible preferred stock   (4,292)
Deemed dividends attributable to vested option holders   (51,855)
Deemed dividends attributable to common stock warrant holders   (110,635)
Net loss attributable to common stockholders - Basic$(92,700)$(84,938)$(181,966)$(169,431)
Gain attributable to earnout shares issued   (84,420)
Change in fair value of dilutive warrants (7,427) (53,540)
Net loss attributable to common stockholders - Diluted$(92,700)$(92,365)$(181,966)$(307,391)
Weighted average shares outstanding - Basic336,813,555 312,227,526 335,736,772 266,197,482 
Weighted average shares outstanding - Diluted336,813,555 313,602,100 335,736,772 275,577,000 
Net loss per share - Basic$(0.28)$(0.27)$(0.54)$(0.64)
Net loss per share - Diluted$(0.28)$(0.29)$(0.54)$(1.12)
The accompanying notes are an integral part of these condensed consolidated financial statements.
7


ChargePoint Holdings, Inc.
Condensed Consolidated Statements of Comprehensive Loss
(in thousands, unaudited)
Three Months Ended,
July 31
Six Months Ended
July 31,
2022202120222021
Net loss$(92,700)$(84,938)$(181,966)$(2,649)
Other comprehensive loss:
Foreign currency translation adjustment(6,562)(12)(19,502)(5)
Unrealized loss on short-term investments, net of tax(1,303) (1,303) 
Other comprehensive loss(7,865)(12)(20,805)(5)
Comprehensive loss$(100,565)$(84,950)$(202,771)$(2,654)

The accompanying notes are an integral part of these condensed consolidated financial statements.
8


ChargePoint Holdings, Inc.
Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)
(unaudited)

Common StockAdditional Paid-In CapitalAccumulated Other Comprehensive LossAccumulated DeficitTotal Stockholders’ (Deficit) Equity
 SharesAmount
 (in thousands, except share data)
Balances as of January 31, 2022334,760,615 $33 $1,366,855 $(8,219)$(811,655)$547,014 
Issuance of common stock under stock plans, net of tax withholding1,631,104 1 772 — — 773 
Issuance of common stock upon exercise of warrants
16,948 — 48 — — 48 
Issuance of common stock upon ESPP purchase
263,962 — 3,920 — — 3,920 
Vesting of early exercised stock options— — 17 — — 17 
Stock-based compensation— — 15,527 — — 15,527 
Net loss— — — — (89,266)(89,266)
Other comprehensive loss— — — (12,941)— (12,941)
Balances as of April 30, 2022336,672,629 $34 $1,387,139 $(21,160)$(900,921)$465,092 
Issuance of common stock under stock plans, net of tax withholding2,147,834  728 — — 728 
Vesting of early exercised stock options— — 15 — — 15 
Stock-based compensation— — 26,419 — — 26,419 
Net loss— — — — (92,700)(92,700)
Other comprehensive loss— — — (7,865)— (7,865)
Balances as of July 31, 2022338,820,463 $34 $1,414,301 $(29,025)$(993,621)$391,689 






























9


ChargePoint Holdings, Inc.
Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) - (continued)
(unaudited)

Redeemable Convertible Preferred StockCommon StockAdditional Paid-In CapitalAccumulated Other Comprehensive Income (Loss)Accumulated DeficitTotal Stockholders’ Deficit
 
Shares(1)
Amount
Shares(1)
Amount
  (in thousands, except share data)
Balances as of January 31, 2021182,934,257 $615,697 22,961,032 $2 $62,736 $155 $(679,414)$(616,521)
Conversion of redeemable convertible preferred stock into common stock in connection with the reverse recapitalization, including impact of Series H-1 paid in kind dividend(182,934,257)(615,697)194,060,336 20 615,677 — — 615,697 
Reclassification of Legacy ChargePoint preferred stock warrant liability upon the reserve capitalization— — — — 66,606 — — 66,606 
Issuance of common stock upon the reverse recapitalization, net of issuance costs— — 60,746,989 6 200,460 — — 200,466 
Issuance of common stock upon exercise of warrants— — 9,766,774 1 225,375 — — 225,376 
Contingent earnout liability recognized upon the closing of the reverse recapitalization— — — — (828,180)— — (828,180)
Issuance of earnout shares upon triggering events, net of tax withholding— — 17,539,657 2 488,303 — — 488,305 
Reclassification of remaining contingent earn-out liability upon triggering event— — — — 242,640 — — 242,640 
Vesting of early exercised stock options— — — — 78 — — 78 
Repurchase of early exercised common stock— — (1,588)— — — — — 
Stock-based compensation— — — — 7,577 — — 7,577 
Net loss— — — — — — 82,289 82,289 
Other comprehensive income— — — — — 7 — 7 
Balances as of April 30, 2021 $ 305,073,200 $31 $1,081,272 $162 $(597,125)$484,340 
Issuance of common stock upon release of restricted stock units— — 652,901 — — — — — 
Issuance of common stock upon exercise of warrants— — 4,378,568  113,608 — — 113,608 
Issuance of common stock upon exercise of vested stock options— — 3,292,219 — 1,761 — — 1,761 
Issuance of earnout shares upon triggering events, net of tax withholding— — 8,773,596 1,000 (8,081)— — (8,080)
Vesting of early exercised stock options— — — — 40 — — 40 
Stock-based compensation— — — — 28,293 — — 28,293 
Net loss— — — — — — (84,938)(84,938)
Other comprehensive loss— — — — — (12)— (12)
Balances as of July 31, 2021 $ 322,170,484 $32 $1,216,893 $150 $(682,063)$535,012 

(1)The shares of the Company’s common and redeemable convertible preferred stock prior to the Merger (as defined in Note 1) have been retroactively restated to reflect the exchange ratio of approximately 0.9966 established in the Merger as described in Note 1.

The accompanying notes are an integral part of these condensed consolidated financial statements.
10


ChargePoint Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
Six Months Ended
July 31,
20222021
(in thousands)
Cash flows from operating activities
Net loss$(181,966)$(2,649)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization12,476 5,576 
Non-cash operating lease cost2,451 1,963 
Stock-based compensation41,946 35,870 
Amortization of deferred contract acquisition costs1,118 829 
Change in fair value of redeemable convertible preferred stock warrant liability (9,237)
Change in fair value of common stock warrant liabilities24 (33,340)
Change in fair value of contingent earnout liability (84,420)
Transaction costs expensed 7,031 
Other4,991 1,236 
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable, net(36,178)(7,657)
Inventories(18,239)5,620 
Prepaid expenses and other assets(9,964)(9,325)
Operating lease liabilities(2,465)(953)
Accounts payable14,907 9,293 
Accrued and other liabilities16,454 3,027 
Deferred revenue20,773 15,938 
Net cash used in operating activities(133,672)(61,198)
Cash flows from investing activities
Purchases of property and equipment(8,872)(7,788)
Purchases of short-term investments(284,835) 
Cash paid for acquisitions, net of cash acquired(2,756) 
Net cash used in investing activities(296,463)(7,788)
Cash flows from financing activities
Proceeds from the exercise of warrants 117,598 
Proceeds from issuance of debt, net of discount and issuance costs293,972 
Merger and PIPE financing 511,646 
Payments of transaction costs related to Merger (32,468)
Payment of tax withholding obligations on settlement of earnout shares (20,894)
Repayment of borrowings (36,051)
Proceeds from the issuance of common stock under employee equity plans, net of tax withholding5,419 1,759 
Change in driver funds and amounts due to customers4,238  
Net cash provided by financing activities303,629 541,590 
Effect of exchange rate changes on cash, cash equivalents, and restricted cash(1,067)(6)
Net increase (decrease) in cash, cash equivalents, and restricted cash(127,573)472,598 
Cash, cash equivalents, and restricted cash at beginning of period315,635 145,891 
Cash, cash equivalents, and restricted cash at end of period$188,062 $618,489 
11


ChargePoint Holdings, Inc.
Condensed Consolidated Statements of Cash Flows - (continued)
Six Months Ended July 31, 2022 and 2021
(unaudited)

Six Months Ended
July 31,
20222021
(in thousands)
Supplementary cash flow information
Cash paid for interest$ $344 
Cash paid for taxes$197 $115 
Supplementary cash flow information on noncash investing and financing activities
Acquisitions of property and equipment included in accounts payable and accrued and other current liabilities$910 $ 
Vesting of early exercised stock options$32 $ 
Conversion of redeemable convertible preferred stock into common stock in connection with the reverse recapitalization$ $615,697 
Reclassification of Legacy ChargePoint redeemable convertible preferred stock warrant liability upon the reverse capitalization$ $66,606 
Contingent earnout liability recognized upon the closing of the reverse recapitalization
$ $828,180 
Reclassification of remaining contingent earnout liability upon triggering event
$ $242,640 

The accompanying notes are an integral part of these condensed consolidated financial statements.
12


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)

1.Description of Business and Basis of Presentation
ChargePoint Holdings, Inc. (“ChargePoint” or the “Company,” “it,” “its”) designs, develops and markets networked electric vehicle (“EV”) charging system infrastructure (“Networked Charging Systems”), connected through cloud-based services (“Cloud” or “Cloud Services”) which (i) enable charging system owners, or hosts, to manage their Networked Charging Systems, and (ii) enable drivers the ability to locate, reserve and authenticate Networked Charging Systems, and to transact EV charging sessions on those systems. ChargePoint’s Networked Charging Systems, subscriptions and other offerings provide an open platform that integrates with system hardware from ChargePoint and other manufacturers, connecting systems over an intelligent network that provides real-time information about charging sessions and full control, support and management of the Networked Charging Systems. This network also provides multiple web-based portals for charging system owners, fleet managers, drivers and utilities.
In addition, the Company offers a range of extended warranties (“Assure”), as well as its ChargePoint as a Service (“CPaaS”) program which bundles use of ChargePoint owned and operated systems with Cloud Services, Assure and other benefits into one subscription.
The Company’s fiscal year ends on January 31. References to fiscal year 2022 relate to the fiscal year ended January 31, 2022 and to fiscal year 2023 refer to the fiscal year ending January 31, 2023.
Basis of Presentation
The condensed consolidated financial statements and accompanying notes are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial reporting. The Company’s condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended January 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on April 4, 2022, which provides a more complete discussion of the Company’s accounting policies and certain other information. The information as of January 31, 2022, included on the condensed consolidated balance sheets was derived from the Company’s audited consolidated financial statements. The condensed consolidated financial statements were prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary for a fair statement of the Company’s financial position as of July 31, 2022, and the results of operations for the three and six months ended July 31, 2022 and 2021, and cash flows for the six months ended July 31, 2022 and 2021. The results of operations for the three and six ended July 31, 2022, are not necessarily indicative of the results that may be expected for the year ending January 31, 2023.
The Company’s condensed consolidated financial statements have been prepared on the basis of continuity of operations, the realization of assets, and the satisfaction of liabilities in the ordinary course of business. Since inception, the Company has been engaged in developing and marketing its product offerings, raising capital and recruiting personnel. The Company’s operating plan may change as a result of many factors currently unknown and there can be no assurance that the current operating plan will be achieved at the levels or in the time frame anticipated by the Company, and it may need to seek additional funds sooner than planned. If adequate funds are not available to the Company on a timely basis, it may be required to delay, limit, reduce, or terminate certain commercial efforts, or to pursue merger or acquisition strategies, all of which could adversely affect the holdings or the rights of the Company’s stockholders. The Company has incurred net operating losses and negative cash flows from operations every year since inception and expects this to continue for the foreseeable future. As of July 31, 2022, the Company had an accumulated deficit of $993.6 million.
The Company has funded its operations primarily with proceeds from the issuance of redeemable convertible preferred stock, convertible notes, exercise proceeds from options and warrants, borrowings under loan facilities, customer payments and proceeds from the Reverse Recapitalization (as defined below). The Company had cash, short-term investments and restricted cash of $471.9 million as of July 31, 2022. As of September 8, 2022, the date on which these condensed consolidated financial
13


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
statements were issued, the Company believes that its cash on hand, together with cash generated from sales to customers, will satisfy its working capital and capital requirements for at least the next twelve months.
The Company’s assessment of the period of time its financial resources will be adequate to support its operations is a forward-looking statement and involves risks and uncertainties. The Company’s actual results could vary as a result of, and its near- and long-term future capital requirements will depend on, many factors, including its growth rate, subscription renewal activity, the timing and extent of spending to support its acquisitions, infrastructure and research and development efforts, the expansion of sales and marketing activities, the timing of new introductions of products or features, the continuing market adoption of its Networked Charging Systems and Cloud Services platform, and the overall market acceptance of EVs. The Company has and may in the future enter into arrangements to acquire or invest in complementary businesses, services and technologies, including intellectual property rights. The Company has based its estimates on assumptions that may prove to be wrong, and it could use its available capital resources sooner than it currently expects. The Company may be required to seek additional equity or debt financing. Future liquidity and cash requirements will depend on numerous factors, including market penetration, the introduction of new products, and potential acquisitions of related businesses or technology. If additional financing is required from outside sources, the Company may not be able to raise it on acceptable terms or at all. If the Company is unable to raise additional capital when desired, or if it cannot expand its operations or otherwise capitalize on its business opportunities because it lacks sufficient capital, its business, operating results and financial condition would be adversely affected.
Reverse Recapitalization
On February 26, 2021, Lightning Merger Sub Inc., a wholly-owned subsidiary of Switchback Energy Acquisition Corporation (“Switchback”), merged with ChargePoint, Inc. (“Legacy ChargePoint”), with Legacy ChargePoint surviving as a wholly-owned subsidiary of Switchback (the “Merger”). As a result of the Merger, Switchback was renamed “ChargePoint Holdings, Inc.” Immediately prior to the closing of the Merger (the “Closing”), Legacy ChargePoint’s outstanding series of redeemable convertible preferred stock were converted to Legacy ChargePoint common stock, which then converted to the Company’s common stock (“Common Stock”).
At the Merger, eligible ChargePoint equity holders received or had the right to receive shares of Common Stock at a deemed value of $10.00 per share after giving effect to the exchange ratio of 0.9966 as defined in the Merger Agreement (“Exchange Ratio”). Accordingly, immediately following the consummation of the Merger, Legacy ChargePoint common stock exchanged into 217,021,368 shares of Common Stock, 68,896,516 shares were reserved for the issuance of Common Stock upon the potential future exercise of Legacy ChargePoint stock options and warrants that were exchanged into ChargePoint stock options and warrants, and 27,000,000 shares of Common Stock were reserved for the potential future issuance of the earnout shares.
In connection with the execution of the Merger Agreement, Switchback entered into separate subscription agreements (each a “Subscription Agreement”) with a number of investors (each a “New PIPE Investor”), pursuant to which the New PIPE Investors agreed to purchase, and Switchback agreed to sell to the New PIPE Investors, an aggregate of 22,500,000 shares of Common Stock (“PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $225.0 million, in a private placement pursuant to the subscription agreements (“PIPE Financing”). The PIPE Financing closed simultaneously with the consummation of the Merger.
Pursuant to the terms of a letter agreement the initial Switchback stockholders entered into in connection with the execution of the Merger Agreement (“Founders Stock Letter”), the initial stockholders surrendered 984,706 of Switchback Class B common stock shares purchased by NGP Switchback, LLC, a Delaware limited liability company (“Sponsor”) prior to the Switchback Public Offering on May 16, 2019 ( “Founder Shares”) for no consideration, whereupon such Founder Shares were immediately cancelled. Additionally, 900,000 Founder Shares, which were previously subjected to potential forfeiture until the closing volume weighted average price per share of the Company’s Common Stock achieved $12.00 for any ten trading days within any twenty consecutive trading day period during the five-year period following the Closing (“Founder Earn Back Triggering Event” and such Founder Shares the “Founder Earn Back Shares”), met the Founder Earn Back Triggering Event on March 12, 2021.
At the Closing, the Sponsor exercised its right to convert a portion of the working capital loans made by the Sponsor to Switchback into an additional 1,000,000 Private Placement Warrants at a price of $1.50 per warrant in satisfaction of $1.5 million principal amount of such loans.
14


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The number of shares of Common Stock issued immediately following the consummation of the Merger was as follows:
Shares
Common stock of Switchback, outstanding prior to Merger39,264,704 
Less redemption of Switchback shares(33,009)
Less surrender of Switchback Founder Shares(984,706)
Common stock of Switchback38,246,989 
Shares issued in PIPE22,500,000 
Merger and PIPE financing shares (1)60,746,989 
Legacy ChargePoint shares (2)217,021,368 
Total shares of common stock immediately after Merger277,768,357 
_______________
(1) This includes 900,000 contingently forfeitable Founder Earn Back Shares pending the occurrence of the Founder Earn Back Triggering Event, which was met on March 12, 2021
(2) The number of Legacy ChargePoint shares was determined by converting the 217,761,738 shares of Legacy ChargePoint common stock outstanding immediately prior to the closing of the Merger using the Exchange Ratio of 0.9966. All fractional shares were rounded down.
All periods prior to the Merger have been retrospectively adjusted using the Exchange Ratio for the equivalent number of shares outstanding immediately after the Merger to effect the reverse recapitalization. Additionally, upon the consummation of the Merger, the Company gave effect to the issuance of 60,746,989 shares of Common Stock for the previously issued Switchback common stock and PIPE Shares that were outstanding at the Closing Date.
In connection with the Merger, the Company raised $511.6 million of proceeds including the contribution of $286.6 million of cash held in Switchback’s trust account from its initial public offering, net of redemptions of Switchback public stockholders of $0.3 million, and $225.0 million of cash in connection with the PIPE financing. The Company incurred $36.5 million of transaction costs, consisting of banking, legal, and other professional fees, of which $29.5 million was recorded as a reduction to additional paid-in capital of proceeds and the remaining $7.0 million was expensed in the condensed consolidated statements of operations.
2.Summary of Significant Accounting Policies
Other than policies noted below, there have been no significant changes to the significant accounting policies disclosed in Note 2 of the audited consolidated financial statements as of January 31, 2022 and 2021 and for the years ended January 31, 2022, 2021 and 2020.
Use of Estimates
The preparation of the accompanying condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results and outcomes could differ significantly from the Company’s estimates, judgments and assumptions. Significant estimates include determining standalone selling price for performance obligations in contracts with customers, the estimated expected benefit period for deferred contract acquisition costs, allowances for credit losses, inventory reserves, loss on purchase commitment, the useful lives of long-lived assets, the determination of the incremental borrowing rate used for operating lease liabilities, the valuation of redeemable convertible preferred stock warrants and Common Stock warrants, including Common Stock Warrants as a result of the Merger, contingent earnout liability, valuation of acquired goodwill and intangible assets, the value of Common Stock and other assumptions used to measure stock-based compensation, and the valuation of deferred income tax assets and uncertain tax positions. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods. As future events and their effects cannot be determined with precision, actual results could materially differ from those estimates and assumptions.
15


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
Concentration of Credit Risk and Other Risks and Uncertainties
Financial instruments that potentially subject the Company to credit risk consist primarily of cash and cash equivalents and accounts receivable. Cash and cash equivalents are held in domestic and foreign cash accounts with large, creditworthy financial institutions. The Company has not experienced any losses on its deposits of cash and cash equivalents through deposits with federally insured commercial banks. At times cash deposit balances may be in excess of federal insurance limits.
Accounts receivable are stated at the amount the Company expects to collect. The Company generally does not require collateral or other security in support of accounts receivable. To reduce credit risk, management performs ongoing credit evaluations of its customers’ financial condition.
Concentration of credit risk with respect to trade accounts receivable is considered to be limited due to the diversity of the Company’s customer base and geographic sales areas. As of July 31, 2022, one customer individually accounted for 15% of accounts receivable, net. As of January 31, 2022, no customer individually accounted for 10% or more of accounts receivable, net. For the three months ended July 31, 2022, one customer accounted for 13% of total revenue. For the three months ended July 31, 2021, there were no customers that represented 10% or more of total revenue. For the six months ended July 31, 2022 and 2021, there were no customers that represented 10% or more of total revenue.
The Company’s revenue is concentrated in the infrastructure needed for charging EVs, an industry which is highly competitive and rapidly changing. Significant technological changes within the industry or customer requirements, or the emergence of competitive products with new capabilities or technologies, could adversely affect the Company’s business, operating results and financial condition.
Supply chain disruptions and COVID-19
In March 2020, the World Health Organization characterized COVID-19 as a pandemic. The impact of COVID-19, including changes in consumer and business behavior, pandemic fears and market downturns, and restrictions on business and individual activities, has created significant volatility in the global economy and led to reduced economic activity. The spread of COVID-19 has disrupted the Company’s supply chain and heightened its freight and logistic costs, and has similarly disrupted manufacturing, delivery and overall supply chain of vehicle manufacturers and suppliers, which has led to fluctuations in EV sales in markets around the world. These ongoing supply chain challenges and heightened logistic costs decreased gross margins in the three and six months ended July 31, 2022, and the Company expects that gross margins will continue to be adversely affected by increased material costs and freight and logistic expenses through the remainder of the fiscal year ending January 31, 2023.
As a result of the COVID-19 pandemic, the Company initially modified its business practices (including reducing employee travel, recommending that all non-essential personnel work from home and canceling or reducing physical participation in sales activities, meetings, events and conferences), implemented additional safety protocols for essential workers, and implemented temporary cost cutting measures in order to reduce its operating costs. In May 2022, the Company commenced a “return-to-office” plan, which includes shifting to a hybrid model where employees have the flexibility to work from home or from the office. The ongoing COVID-19 pandemic has resulted in government authorities implementing numerous measures to try to contain the COVID-19 virus, such as travel bans and restrictions, quarantines, stay-at-home or shelter-in-place orders and business shutdowns. While these measures may be relaxed or revised in some areas, there is no guarantee these measures will not be reinstated or resumed due to additional variants of COVID-19 or the inability or ineffectiveness of public health measures to limit the further spread of COVID-19. The Company may take further actions as may be required by government authorities or that it determines are in the best interests of its employees, customers, suppliers, vendors and business partners as the result of the COVID-19 pandemic.
The ultimate full societal and economic impact of the COVID-19 pandemic remains unknown and its duration and extent depend on current and future developments that cannot be accurately predicted. It has already had an adverse effect on the global economy, the persistence of which has varied over time and across the geographies in which the Company operates. The conditions caused by the COVID-19 pandemic, such as more prevalence of permanent work-from-home policies, are likely to continue affecting the rate of global infrastructure spending, and thus to continue to adversely impact the Company’s commercial business and its overall gross margin as the Company’s commercial business contributes higher margins than its residential and fleet businesses. Further, the COVID-19 pandemic could continue to disrupt supply chains and heighten component and shipping pricing and logistics expenses and further adversely impact the Company’s gross margins, adversely
16


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
affect demand for the Company’s platforms, lengthen its product development and sales cycles, reduce the value, renewal rate or duration of subscriptions, negatively impact collections of accounts receivable, reduce expected spending from new customers, cause some of its paying customers to go out of business and limit the ability of the Company’s direct sales force to travel to customers and potential customers, all of which could adversely affect the Company’s business, results of operations and financial condition.
Segment Reporting
The Company operates as one operating segment because its Chief Executive Officer, as the Company’s chief operating decision maker, reviews its financial information on a consolidated basis for purposes of making decisions regarding allocating resources and assessing performance.
Cash, Cash Equivalents, and Restricted Cash
The Company considers all highly liquid investments with an original maturity of three months or less, when purchased, to be cash equivalents. Cash equivalents may be invested in money market funds. Cash and cash equivalents are carried at cost, which approximates their fair value.
Restricted cash of $0.4 million as of July 31, 2022 and January 31, 2022 relates to cash deposits restricted under letters of credit issued in support of trade agreements.
The reconciliation of cash, cash equivalents, and restricted cash to amounts presented in the consolidated statements of cash flows were as follows:
July 31,
2022
January 31,
2022
(in thousands)
Cash and cash equivalents$187,662 $315,235 
Restricted cash400 400 
Total cash, cash equivalents, and restricted cash$188,062 $315,635 
Short Term Investments
The Company's portfolio of marketable debt securities is comprised solely of U.S. government securities with maturities of more than three months, but less than one year. The Company classifies these as available-for-sale at purchase date and will reevaluate such designation at each period end date. The Company may sell these marketable debt securities prior to their stated maturities depending upon changing liquidity requirements.
These debt securities are classified as current assets in the condensed consolidated balance sheet and recorded at fair value, with unrealized gains or losses included in accumulated other comprehensive income (loss) and as a component of the condensed consolidated statements of comprehensive loss.
Gains and losses are recognized when realized. Gains and losses are determined using the specific identification method and are reported in other income (expense), net in the condensed consolidated statements of operations.
An impairment loss may be recognized when the decline in fair value of the debt securities is determined to be other-than-temporary. The Company evaluates its investments for other-than-temporary declines in fair value below the cost basis each quarter, or whenever events or changes in circumstances indicate that the cost basis of the short-term investments may not be recoverable. The evaluation is based on a number of factors, including the length of time and the extent to which the fair value has been below the cost basis, as well as adverse conditions related specifically to the security such as any changes to the credit rating of the security and the intent to sell or whether the Company will more likely than not be required to sell the security before recovery of its amortized cost basis. Credit-related impairment losses, not to exceed the amount that fair value is
17


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
less than the amortized cost basis, are recognized through an allowance for credit losses with changes in the allowance for credit losses recorded in other income (expense), net in the condensed consolidated statements of operations.
Fair Value of Financial Instruments
Fair value is defined as an exchange price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Assets and liabilities measured at fair value are classified into the following categories based on the inputs used to measure fair value:
(Level 1) — Quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;
(Level 2) — Inputs other than quoted prices in active markets that are observable for the asset or liability, either directly or indirectly; and
(Level 3) — Inputs that are unobservable for the asset or liability.
The Company classifies financial instruments in Level 3 of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model. In addition to these unobservable inputs, the valuation models for Level 3 financial instruments typically also rely on a number of inputs that are readily observable, either directly or indirectly. The Company’s assessment of a particular input to the fair value measurement requires management to make judgments and consider factors specific to the asset or liability. The fair value hierarchy requires the use of observable market data when available in determining fair value. The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each period. There were no transfers between levels during the periods presented. The Company had no material non-financial assets valued on a non-recurring basis that resulted in an impairment in any period presented.
The carrying values of the Company’s cash equivalents, accounts receivable, net, accounts payable, and accrued and other current liabilities approximate fair value based on the highly liquid, short-term nature of these instruments.
Remaining Performance Obligations
Remaining performance obligations represents the amount of contracted future revenue not yet recognized as the amounts relate to undelivered performance obligations, including both deferred revenue and non-cancellable contracted amounts that will be invoiced and recognized as revenue in future periods. The Company’s Assure, Cloud and CPaaS subscription terms typically range from one to five years and are paid up-front. Revenue expected to be recognized from remaining performance obligations was $188.0 million as of July 31, 2022, of which 47% is expected to be recognized over the next twelve months.
Deferred Revenue
Deferred revenue represents billings or payments received in advance of revenue recognition and is recognized in revenue upon transfer of control. Balances consist primarily of Cloud and Assure services not yet rendered as of the balance sheet date. Contract assets, which represent services provided or products transferred to customers in advance of the date the Company has a right to invoice, are netted against deferred revenue on a customer-by-customer basis. Current deferred revenue represents deferred revenue that will be recognized within twelve months, and non-current is deferred revenue that will be recognized beyond that twelve-month period. Total deferred revenue was $167.6 million and $146.8 million as of July 31, 2022 and January 31, 2022, respectively. The Company recognized $14.7 million and $7.7 million of revenue during the three months ended July 31, 2022 and 2021, and $37.4 million and $22.9 million of revenue during the six months ended July 31, 2022 and 2021, respectively, that was included in the deferred revenue balance at the beginning of the period.
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes (“ASC 740”). Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the financial reporting and tax bases of assets and liabilities. Deferred tax assets and liabilities are measured by applying enacted statutory tax rates applicable to the
18


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
future years in which deferred tax assets or liabilities are expected to be settled or realized. Valuation allowances, if management deems them necessary, are established to reduce deferred tax assets to the amount that more likely than not will be realized and primarily relate to the ability to utilize losses in various tax jurisdictions.
ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be “more likely than not” to be sustained upon examination by taxing authorities. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The Company has no material uncertain tax position liabilities for any of the reporting periods presented.
Accounting Pronouncements
Recently Issued Accounting Standards
In March 2022, the Financial Accounting Standards Board (“FASB”) issued ASU 2022-02, “Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures,” which addresses areas identified by the FASB as part of its post-implementation review of ASU 2016-13, “Financial Instruments--Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”) that introduced the current expected credit losses (“CECL”) model. The new guidance eliminates the accounting guidance for troubled debt restructurings by creditors that have already adopted the CECL model and enhances the disclosure requirements for loan refinancings and restructurings made with borrowers experiencing financial difficulty. In addition, the new guidance requires a public business entity to disclose current-period gross write-offs for financing receivables and net investment in leases by year of origination. The guidance will be effective for public business entities that have adopted ASU 2016-13 for fiscal years beginning after December 31, 2022, including interim periods within those fiscal years. The Company is currently assessing the impact of this guidance on its consolidated financial statements and related disclosures.
Recently Issued Accounting Standards Adopted
In August 2020, the FASB issued ASU 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40),” which modifies and simplifies accounting for convertible instruments. The new guidance eliminates certain separation models that require separating embedded conversion features from convertible instruments. The guidance also addresses how convertible instruments are accounted for in the diluted earnings per share calculation. The guidance will be effective for fiscal years beginning after December 15, 2021. Early adoption is permitted, but no earlier than for fiscal years beginning after December 15, 2020. The Company adopted ASU 2020-06 on February 1, 2022 and the amendment in this guidance was applied to the convertible note the Company issued in April 2022 (see Note 8, Debt). There were no financial instrument outstanding as of the beginning of the fiscal year 2023 that requires the Company to apply modified retrospective approach.
In November 2021, the FASB issued ASU No. 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance,” which requires entities to disclose annually its transactions with a government accounted for by applying a grant or contribution accounting model by analogy. The disclosure requirement includes information about the nature of the transactions and the related accounting policy used to account for the transactions, the line items on the balance sheet and income statement that are affected by the transactions, and the amounts applicable to each financial statement line, and significant terms and conditions of the transactions, including commitments and contingencies. The guidance will be effective for annual reporting periods beginning after December 15, 2021. Early application is permitted. The Company adopted ASU 2021-10 on February 1, 2022 and elected to apply the amendments prospectively to all transactions within the scope of the amendment that are reflected in the financial statements at the date of adoption. The adoption did not have a material effect on the condensed consolidated financial statements and related disclosures.
3.Business Combinations
ViriCiti B.V.
19


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
On August 11, 2021, the Company acquired all of the outstanding shares of ViriCiti B.V. (“ViriCiti”) for $79.4 million in cash, as well as up to $7.7 million of additional earnout consideration contingent on meeting certain revenue targets through January 31, 2023 (“ViriCiti Earnout”). ViriCiti is a Netherlands-based provider of electrification solutions for eBus and commercial fleets with offices in the Netherlands and the United States. The acquisition is expected to enhance ChargePoint’s fleet solutions portfolio of hardware, software and services by integrating information sources to optimize electric fleet operations.
The acquisition of ViriCiti was considered a business combination and was accounted for under the acquisition method of accounting. The total purchase price was allocated to the net tangible and intangible assets acquired and liabilities assumed based on their respective fair values on the acquisition date and the excess was recorded as goodwill. The total purchase price was allocated to $62.8 million of goodwill, $17.7 million of customer relationship intangible assets, and $6.6 million of developed technology intangible assets acquired, and deferred tax liabilities of $3.5 million and net liabilities of $0.2 million were assumed. Goodwill is not deductible for tax purposes.
has•to•be gmbh
On October 6, 2021, the Company acquired all of the outstanding shares of has•to•be gmbh (“HTB”) for approximately $235.0 million, consisting of $132.9 million in cash and $102.1 million in the form of 5,695,176 shares of ChargePoint Common Stock valued at $17.92 per share on the acquisition date. Of the cash component, $2.8 million was paid on February 3, 2022 as part of a working capital adjustment, and of the shares, 885,692, valued at $15.9 million, are held in escrow to cover indemnity claims the Company may make within eighteen months from the closing date. HTB is an Austria-based e-mobility provider with a European charging software platform. The acquisition is intended to expand the Company’s market share in Europe.
The acquisition of HTB was considered a business combination and was accounted for under the acquisition method of accounting. The total purchase price was allocated to the net tangible and intangible assets acquired and liabilities assumed based on their respective fair values on the acquisition date, and the excess was recorded as goodwill. The total purchase price was allocated to $159.0 million of goodwill, $78.7 million of customer relationship intangible assets, $12.7 million of developed technology intangible assets, and net assets of $2.9 million acquired, and deferred tax liabilities of $18.3 million were assumed. Goodwill is not deductible for tax purposes.
There were no measurement period adjustments for the three and six months ended July 31, 2022, and the Company does not expect any other remeasurement adjustment going forward.
4.Goodwill and Intangible Assets
Goodwill
The following table summarizes the changes in carrying amounts of goodwill (in thousands):
Balance as of January 31, 2022$218,484 
Foreign exchange fluctuations(12,904)
Balance as of July 31, 2022$205,580 
There was no impairment recognized for the three and six months ended July 31, 2022 and 2021.
20


ChargePoint Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The following table presents the details of intangible assets (amounts in thousands, useful lives in years):
July 31, 2022
Cost (1)Accumulated Amortization (1)Net (1)Useful Life
Customer Relationships$86,713 $(7,357)$79,356 10
Developed Technology17,705 (2,579)15,126 6
$104,418 $(9,936)$94,482 
_______________
(1) Values are translated into U.S. Dollars at period-end foreign exchange rates.
January 31, 2022
Cost (1)Accumulated Amortization (1)Net (1)Useful Life
Customer Relationships$93,065 $(3,223)$89,842