CHARGEPOINT HOLDINGS, INC. Management report and analysis of the financial situation and operating results. (Form 10-K)

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The following discussion and analysis provides information which ChargePoint's
management believes is relevant to an assessment and understanding of
ChargePoint's consolidated results of operations and financial condition. This
section of this Form 10-K discusses fiscal year 2022 and 2021 items and
year-to-year comparisons between fiscal year 2022 and 2021. Discussions of
fiscal year 2020 items
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and year-over-year comparisons between fiscal year 2021 and fiscal year 2020 are
not included in this Form 10-K, and can be found in "Management's Discussion and
Analysis of Financial Condition and Results of Operations" of the Company's Form
S-1 Registration Statement filed on October 14, 2021. The discussion should be
read together with the consolidated financial statements and related notes that
are included elsewhere in this Annual Report on Form 10-K. This discussion may
contain forward-looking statements based upon current expectations that involve
risks and uncertainties. ChargePoint's actual results may differ materially from
those anticipated in these forward-looking statements as a result of various
factors, including those set forth under "Risk Factors" included under Part I,
Item 1 A.

Overview

ChargePoint designs, develops and markets networked EV charging system
infrastructure ("Networked Charging Systems") and cloud-based services which
enable consumers the ability to locate, reserve, authenticate and transact EV
charging sessions ("Cloud" or "Cloud Services"). As part of ChargePoint's
Networked Charging Systems, subscriptions and other offerings, it provides 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 provides multiple
web-based portals for charging system owners, fleet managers, drivers and
utilities.

ChargePoint generates revenue primarily through the sale of Networked Charging
Systems, a Cloud Services subscription and an extended parts and labor warranty
subscription ("Assure"), each of which is typically paid for upfront. Assure
also includes proactive monitoring, fast response times, expert advice and
robust reporting. The ChargePoint as a Service ("CPaaS") program combines the
customer's use of ChargePoint's owned and operated systems with Cloud Services,
Assure and other benefits available to subscribers into one subscription.
ChargePoint targets three key customer markets: commercial, fleet and
residential. Commercial customers have parking places largely within their
workplaces and includes retail, hospitality and parking lot operators. Fleet
includes municipal buses, delivery and work vehicles, port/airport/warehouse and
other industrial applications, ride-sharing services, and, is expected to
eventually include, autonomous transportation. Residential includes single
family homes and multifamily residences.

Since ChargePoint's inception in 2007, it has been engaged in developing and
marketing its Networked Charging Systems, subscriptions and other offerings,
raising capital and recruiting personnel. ChargePoint has incurred net operating
losses and negative cash flows from operations in every year since its
inception. As of January 31, 2022 and 2021, ChargePoint had an accumulated
deficit of $811.7 million and $679.4 million, respectively. ChargePoint has
funded its operations primarily from sales of its solutions, with proceeds from
the issuance of redeemable convertible preferred stock and Common Stock and
borrowings under prior loan facilities.

RECENT DEVELOPMENTS

Closing of the merger

On February 26, 2021 (the "Closing Date"), Switchback Energy Acquisition
Corporation ("Switchback"), consummated the previously announced transactions
pursuant to which Lightning Merger Sub Inc., a wholly owned subsidiary of
Switchback incorporated in the State of Delaware ("Merger Sub"), merged with
ChargePoint, Inc., a Delaware corporation ("Legacy ChargePoint"); Legacy
ChargePoint survived as a wholly-owned subsidiary of Switchback (the "Merger"
and, collectively with the other transactions described in the Merger Agreement,
dated as of September 23, 2020, by and among Switchback, Merger Sub and Legacy
ChargePoint, the "Merger Agreement", and such transactions the "Reverse
Recapitalization"). On the Closing Date, and in connection with the closing of
the Merger (the "Closing"), Switchback changed its name to ChargePoint Holdings,
Inc. ("ChargePoint").

Pursuant to the terms of the Merger Agreement, each stockholder of Legacy
ChargePoint received 0.9966 shares of ChargePoint's common stock, par value
$0.0001 per share (the "Common Stock") and the contingent right to receive as
additional merger consideration certain Earnout Shares (as defined below), for
each share of Legacy ChargePoint common stock, par value $0.0001 per share,
owned by such Legacy ChargePoint stockholder that was outstanding immediately
prior to the Closing (other than any shares of Legacy ChargePoint restricted
stock). In addition, certain investors purchased an aggregate of 22,500,000
shares of Common Stock (such investors, the "PIPE Investors") concurrently with
the Closing for an aggregate purchase price of $225.0 million. Additionally, at
the Closing, after giving effect to the forfeiture contemplated by the Founders
Stock Letter (as defined below), each outstanding share of ChargePoint's Class B
common stock, par value $0.0001 per share ("Founder Shares"), was converted into
a share of Common Stock on a one-for-one basis and the Founder Shares ceased to
exist.

Also at the Closing, NGP Switchback, LLC (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.

During the time period between the Closing and the five-year anniversary of the
Closing Date, eligible former equityholders were eligible to receive up to
27,000,000 additional shares of ChargePoint's Common Stock (the "Earnout
Shares") in the aggregate in three equal tranches if the volume-weighted average
closing sale price of the Common Stock is greater than or equal to $15.00,
$20.00 and $30.00 for any 10 trading days within any 20 consecutive trading day
period ("Earnout Triggering Events"). As discussed below, all three Earnout
Triggering Events occurred during the fiscal year ended January 31, 2022.
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In addition, pursuant to the terms of the Merger Agreement, at the effective
time of the Merger (the "Effective Time"), (1) warrants to purchase shares of
capital stock of Legacy ChargePoint were converted into warrants to purchase an
aggregate of 38,761,031 shares of Common Stock and the contingent right to
receive certain Earnout Shares, (2) options to purchase shares of common stock
of Legacy ChargePoint were converted into options to purchase an aggregate of
30,135,695 shares of Common Stock and, with respect to vested options, the
contingent right to receive certain Earnout Shares and (3) unvested restricted
shares of common stock of Legacy ChargePoint that were outstanding pursuant to
the "early exercise" of Legacy ChargePoint options were converted into an
aggregate of 345,689 restricted shares of ChargePoint (the "Restricted Shares").

Complement actions

During the time period between the Closing and the five-year anniversary of the
Closing Date, eligible former equity holders could receive up to 27,000,000
additional shares of Earnout Shares if the Earnout Triggering Events were met.
On March 19, 2021, a total of approximately 18,000,000 shares of Common Stock
were released to eligible former equity holders of Legacy ChargePoint pursuant
to the Earnout Shares provisions of the Merger Agreement, as the first two
Earnout Triggering Events had been met by virtue of the volume-weighted average
closing sale price of Common Stock having been greater than or equal to $15.00
and $20.00 for ten (10) trading days out of twenty (20) consecutive trading days
following the closing of the Merger. The holders of Legacy ChargePoint common
stock (other than restricted stock), warrants and vested options as of the
closing of the Merger received their pro rata portion of the Earnout Shares. On
July 1, 2021, a total of approximately 9,000,000 shares of Common Stock were
released to eligible former equity holders of Legacy ChargePoint pursuant to the
Earnout Shares provision of the Merger Agreement, as the third Earnout
Triggering Event was met by virtue of the volume-weighted average closing sale
price of Common Stock having been greater than or equal to $30.00 for ten (10)
trading days out of twenty (20) consecutive trading days following the closing
of the Merger.

Acquisitions

On August 11, 2021, ChargePoint acquired all of the outstanding shares of
ViriCiti B.V. ("ViriCiti") for $79.4 million in cash, subject to adjustments, 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.

On October 6, 2021, ChargePoint acquired all of the outstanding shares of
has•to•be gmbh ("has•to•be" or "HTB") for $235.0 million, consisting of $132.9
million paid in cash and $102.1 million in the form of 5,695,176 of Common
Stock, of which 885,592 shares, valued at $15.9 million, are subject to escrow
to secure potential future indemnification claims. Has•to•be is an Austria-based
e-mobility provider with a European charging software platform. The acquisition
is intended to expand ChargePoint's market share in Europe.

Main factors affecting operating results

Charging point believes that its performance and future success depend on several factors that present significant opportunities for it but also pose risks and challenges, including those discussed below:

Growth in adoption of electric vehicles

ChargePoint's revenue growth is directly tied to the number of passenger and
commercial EVs sold, which it believes drives the demand for charging
infrastructure. The market for EVs is still rapidly evolving and although demand
for EVs has grown in recent years, there is no guarantee of such future demand.
Factors impacting the adoption of EVs include but are not limited to:
perceptions about EV features, quality, safety, performance and cost;
perceptions about the limited range over which EVs may be driven on a single
battery charge; volatility in the cost of oil and gasoline; availability of
services for EVs; consumers' perception about the convenience and cost of
charging EVs; and increases in fuel efficiency. In addition, macroeconomic
factors, including governmental mandates and incentives, could impact demand for
EVs, particularly since they can be more expensive than traditional
gasoline-powered vehicles and the automotive industry globally has been
experiencing a recent decline in sales. Further, geopolitical factors, such as
the invasion of the Ukraine by Russia may negatively impact the global
automotive supply chain and reduce the manufacturing of automobiles, including
EVs. If the market for EVs does not develop as expected or if there is any
slow-down or delay in overall EV adoption or manufacturing rates, ChargePoint's
financial condition and results of operations would be negatively impacted and
such impact may be material.

Competition

ChargePoint is currently a market leader in North America in the commercial
Level 2 Alternating Current ("AC") charging. ChargePoint also offers AC chargers
for use at home or multifamily settings and for fleet applications, and
high-power Level 3 Direct Current ("DC") chargers for fast urban charging,
corridor or long-trip charging and fleet applications. ChargePoint intends to
expand its market share over time in its product categories, leveraging the
network effect of its products and Cloud Services software. Existing competitors
may expand their product offerings and sales strategies, and new competitors may
enter the market. If ChargePoint's market share decreases due to increased
competition, its financial condition and results of operations in the future may
be negatively impacted.
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Furthermore, ChargePoint's success could be negatively impacted if consumers and
business choose other types of alternative fuel vehicles or high fuel-economy
gasoline powered vehicles.

European expansion

ChargePoint operates in North America and selected countries in Europe. Europe
is expected to be a significant contributor to ChargePoint's revenue in future
years. ChargePoint is using a portion of the proceeds from the Merger to
increase its sales and marketing activities in Europe. ChargePoint is also
positioned to grow its European business through existing partnerships with car
leasing companies and its recently closed acquisition of ViriCiti and has•to•be.
In Europe, ChargePoint primarily competes with other providers of EV charging
station networks. Many of these competitors have limited funding, which could
cause poor customer experiences and have a negative impact on overall EV
adoption in Europe. ChargePoint's growth in Europe requires differentiating
itself as compared to these existing competitors. If ChargePoint is unable to
continue penetrating the market in Europe, its financial condition and results
of operations would be negatively impacted.

Fleet expansion

ChargePoint's future growth is highly dependent upon fleet applications. Because
fleet operators often make large purchases of EVs, volatility may be more
pronounced and any significant decline from these customers may have an adverse
impact on ChargePoint's potential for future growth and such impact may be
material.

Impact of new product launches and investments in growth

As ChargePoint introduces new products, such as the release of its Level 3 DC
fast charger in fiscal year 2020, its gross margins may be initially negatively
impacted by launch costs and lower volumes until it achieves targeted cost
reductions. Cost reductions may not occur on the timeline ChargePoint expects
due to unanticipated supply chain difficulties. For example, ongoing supply
chain challenges and heightened logistic costs related to disruptions caused by
COVID-19 and component shortages decreased gross margins in the fiscal year
ended January 31, 2022, and ChargePoint expects gross margins will continue to
be adversely affected by increased material costs and freight and logistic
expenses in fiscal year ending January 31, 2023. In addition, ChargePoint may
accelerate its expenditures where it sees growth opportunities, which may impact
gross margin until upfront costs and inefficiencies are absorbed and normalized
operations are achieved. ChargePoint's focus on optimizing for customer
acquisition and prioritizing an assurance of supply of its products as part of
its "land-and-expand" model generally results in gross margin pressure, and
ChargePoint's strategy is to grow such customer relationships over time and
develop customers who become a source of ongoing subscription revenue.
ChargePoint also continuously evaluates and may adjust its expenditures based on
its launch plans for new products, as well as other factors including the pace
and prioritization of current projects under development and the addition of new
projects. As ChargePoint attains higher revenue, it expects operating expenses
as a percentage of total revenue to decrease as it scales and focuses on
increasing operational efficiency and process automation.

Mandates, Incentives and Government Programs

The U.S. federal government, certain foreign governments and some state and
local governments provide incentives to end users and purchasers of EVs and EV
infrastructure in the form of rebates, tax credits and other financial
incentives. These governmental rebates, tax credits and other financial
incentives significantly lower the effective price of EVs and EV infrastructure
to customers. For example, the infrastructure Investment and Jobs Act signed
into law on November 15, 2021 would provide additional funding for EVs and EV
charging infrastructure through the creation of new programs and grants and the
expansion of existing programs, including $7.5 billion for EV charging along
highway corridors. However, such incentives take time to be disbursed and to
affect actual expenditure decisions. These incentives may also expire on
specified dates, end when the allocated funding is no longer available, or be
reduced or terminated as a matter of regulatory or legislative policy. For
example, the credits under Section 30C of the Internal Revenue Code of 1986, as
amended (the "Code") which benefit investments in EV infrastructure expired on
December 31, 2021, and there can be no assurance that the credits under Section
30C of the Code will be extended in the future. Any reduction in rebates, tax
credits or other financial incentives could reduce the demand for EVs and for
charging infrastructure, including infrastructure ChargePoint offers.

ChargePoint also derives other revenue from fees received for regulatory credits
earned for participating in low carbon fuel programs in approved U.S. states.
ChargePoint claims these regulatory credits only if they are not claimed by
purchasers of its EV charging stations; only a small percentage of its customers
currently elect to claim such credits. If a material percentage of its customers
were to claim these regulatory credits, ChargePoint's revenue from this source
could decline significantly, which could have an adverse effect on its revenue
and overall gross margin. Prior to fiscal year 2021, ChargePoint derived a
slight majority of its other revenue from these regulatory credits. However,
revenue from this source as a percentage of total revenue has declined recently
and may continue to decline over time. Further, the availability of such credits
depends on continued governmental support for these programs. If these programs
are modified, reduced or eliminated, ChargePoint's ability to generate this
revenue in the future would be adversely impacted.
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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
ChargePoint'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 fiscal year ended
January 31, 2022, and ChargePoint expects that gross margins will continue to be
adversely affected by increased material costs and freight and logistic expenses
in fiscal year ending January 31, 2023.

As a result of the COVID-19 pandemic, ChargePoint 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.
ChargePoint has commenced a "return-to-office" plan, which includes shifting to
a hybrid model where employees have flexibility to work from home, ChargePoint
has not yet set a return-to-office-date in light of the dynamic nature of the
COVID-19 pandemic.The 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. ChargePoint 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, which have and likely will vary over time and across the
geographies in which ChargePoint operates. For example, variations in
work-from-home policies can cause fluctuations in ChargePoint's revenues, and
ChargePoint believes that since people are not yet fully back to offices it has
not yet seen the full return of commercial customer demand for its products. The
conditions caused by the COVID-19 pandemic, such as more permanent
work-from-home policies, are likely to continue affecting the rate of global
infrastructure spending, and thus to continue to adversely impact ChargePoint's
commercial business and its overall gross margin as ChargePoint's commercial
business contributes higher margins than its residential and fleet businesses.
Further, the COVID-19 pandemic could continue to heighten supply chain pricing
and logistics expenses and further adversely impact ChargePoint's gross margins,
adversely affect demand for ChargePoint'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 its direct sales force to travel to
customers and potential customers, all of which could adversely affect
ChargePoint's business, results of operations and financial condition.

Operating results and its components

Income

Network charging systems

Networked Charging Systems revenue includes the deliveries of EV charging system
infrastructure, which include a range of Level 2 AC products for use in
residential, commercial and fleet applications, and Level 3 DC, or fast-charge
products for use in commercial and fleet applications. A significant portion of
ChargePoint's Networked Charging Systems revenue is presently derived from the
sale of Level 2 AC products. ChargePoint generally recognizes revenue from sales
of Networked Charging Systems upon shipment to the customer, at which point
ChargePoint's performance obligation is satisfied.

Subscriptions

Subscriptions revenue consists of services related to Cloud, as well as extended
maintenance service plans under Assure. Subscriptions revenue also consists of
CPaaS revenue which combines the customer's use of ChargePoint's owned and
operated systems with Cloud and Assure programs into a single subscription.

CPaaS subscriptions are considered for accounting purposes to contain a lease
for the customer's use of ChargePoint's owned and operated systems unless the
location allows the customer to receive incremental economic benefit from
regulatory credits earned on that EV charging system. Lessor revenue relates to
operating leases and historically has not been material. Subscriptions revenue
is generally recognized over time on a straight-line basis as ChargePoint has an
ongoing obligation to deliver such services to the customer.
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Other

Other revenue consists of fees received for transferring regulatory credits
earned for participating in low carbon fuel programs in approved states,
charging related fees received from drivers using charging sites owned and
operated by ChargePoint, net transaction fees earned for processing payments
collected on driver charging sessions at charging sites owned by its customers,
and other professional services. Revenue from regulatory credits is recognized
when the regulatory credits are transferred. Revenue from fees for owned and
operated sites is recognized over time on a straight-line basis over the
performance period of the service contract as ChargePoint has an ongoing
obligation to deliver such services. Revenue from driver charging sessions and
charging transaction fees is recognized when the charging session or transaction
is completed. Revenue from professional services is recognized as the services
are rendered.

ChargePoint expects revenue to grow in both Networked Charging Systems and
subscriptions due to increased demand in EVs and the related charging
infrastructure market.

                                            For the Year Ended January 31,                                                     Change
                                       2022                2021               2020                      2022 vs 2021                             2021 vs 2020
                                                                                                 Change               Change              Change               Change
                                   (dollar amounts in thousands, except percentages)               ($)                 (%)                  ($)                 (%)
Networked Charging Systems       $    173,850           $ 91,893          $ 101,012          $     81,957               89.2  %       $     (9,119)              (9.0) %
Percentage of total revenue              72.1   %           62.7  %            69.9  %


Networked Charging Systems revenue increased for fiscal year ended January 31,
2022 compared to fiscal year 2021 primarily due to a continued increase in
demand from customers resulting in higher volumes of systems delivered across
ChargePoint's major product families.

                                                  For the Year Ended January 31,                                                     Change
                                             2022                 2021              2020                      2022 vs 2021                             2021 vs 2020
                                                                                                       Change               Change              Change               Change
                                         (dollar amounts in thousands, except percentages)               ($)                 (%)                  ($)                 (%)
Subscriptions                          $    53,512             $ 40,563          $ 28,930          $     12,949               31.9  %       $     11,633               40.2  %
Percentage of total revenue                   22.2     %           27.7  %           20.0  %


Subscriptions revenue increased for the fiscal year ended January 31, 2022
compared to fiscal year 2021. The increase was primarily due to the growth in
the number of Networked Charging Systems connected to ChargePoint's network, and
contributions from newly acquired companies in Europe.

                                            For the Year Ended January 31,                                                    Change
                                       2022                 2021              2020                     2022 vs 2021                            2021 vs 2020
                                                                                                 Change              Change              Change              Change
                                   (dollar amounts in thousands, except percentages)              ($)                 (%)                 ($)                 (%)
Other revenue                    $    13,644             $ 14,034          $ 14,573          $      (390)              (2.8) %       $      (539)              (3.7) %
Percentage of total revenue              5.7     %            9.6  %           10.1  %


Other revenue decreased for the fiscal year ended January 31, 2022 compared to
fiscal year 2021 primarily due to newly acquired companies in Europe, partially
offset by a continued decrease in regulatory credits transferred.

Revenue cost

Network charging systems

ChargePoint uses contract manufacturers to manufacture the substantial majority
of its Networked Charging Systems. ChargePoint's in-house manufacturing is
typically limited to initial development units and to early customer samples.
ChargePoint's cost of revenue for the sale of Networked Charging Systems
includes the contract manufacturer costs of finished goods and shipping and
handling. For ChargePoint's limited in-house production, cost of revenue for the
sale of Networked Charging Systems also includes parts, labor, manufacturing
costs, and allocated facilities and information technology expenses. Cost of
revenue for the sale of Networked Charging Systems also consists of salaries and
related personnel expenses, including stock-based compensation, warranty
provisions, depreciation of manufacturing related equipment and facilities,
amortization of capitalized internal-use software, and allocated facilities and
information technology expenses. As revenue is recognized, ChargePoint accounts
for estimated warranty cost as a charge to cost of revenue. The estimated
warranty cost is based on historical and predicted product failure rates and
repair expenses.
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Subscriptions

Cost of Subscriptions revenue includes salaries and related personnel expenses,
including stock-based compensation and third-party support costs to manage the
systems and helpdesk services for drivers and site hosts, network and wireless
connectivity costs for subscription services, field costs for Assure,
depreciation of owned and operated systems used in CPaaS arrangements,
amortization of capitalized internal-use software development costs, allocated
facilities and information technology expenses.

Other

Cost of other revenue includes depreciation and other costs for ChargePoint's
owned and operated charging sites, charging related processing charges, salaries
and related personnel expenses, including stock-based compensation, as well as
costs of professional services.

                                       For the Year Ended January 31,                                                      Change
                                  2022                2021               2020                      2022 vs 2021                             2021 vs 2020
                                                                                            Change               Change              Change               Change
                              (dollar amounts in thousands, except percentages)               ($)                 (%)                  ($)                  (%)
Cost of Networked Charging
Systems revenue             $    147,313           $ 87,083          $ 105,940          $     60,230               69.2  %       $    (18,857)              (17.8) %
Percentage of total revenue         61.1   %           59.4  %            73.3  %

Network charging system cost revenue increased in the year ended January 31, 2022 compared to the same period in 2021, mainly due to an increase in the number of in-grid charging systems delivered.

                                                    For the Year Ended January 31,                                                     Change
                                               2022                 2021              2020                      2022 vs 2021                            2021 vs 2020
                                                                                                         Change               Change              Change              Change
                                           (dollar amounts in thousands, except percentages)               ($)                 (%)                 ($)                 (%)
Cost of Subscriptions revenue            $    31,190             $ 20,385          $ 16,244          $     10,805               53.0  %       $     4,141               25.5  %
Percentage of total revenue                     12.9     %           13.9  %           11.2  %


Cost of subscriptions revenue increased during fiscal year ended January 31,
2022 compared to the same period in 2021 primarily due to an increase of
customer support personnel cost resulting from headcount increases, including
stock-based compensation.

                                 For the Year Ended January 31,                                                   Change
                             2022               2021             2020                     2022 vs 2021                              2021 vs 2020
                              (dollar amounts in thousands, except                 Change               Change               Change               Change
                                          percentages)                              ($)                  (%)                  ($)                  (%)
Cost of Other Revenue   $   8,970            $ 6,073          $ 4,289          $     2,897                 47.7  %       $     1,784                 41.6  %
Percentage of total
revenue                       3.7    %           4.1  %           3.0  %

The cost of other products increased for the year ended January 31, 2022
compared to the same period in 2021. The increase is mainly related to higher processing fees related to billing and amortization of owned and operated charging sites.

Gross Profit and Gross Margin

Gross profit is revenue less cost of revenue and gross margin is gross profit as
a percentage of revenue. ChargePoint offers a range of Networked Charging
Systems products which vary widely in selling price and associated gross margin,
as for example ChargePoint's commercial business contributes higher margins than
its residential and fleet businesses. Accordingly, ChargePoint's gross profit
and gross margin have varied and are expected to continue to vary from period to
period due to revenue levels; geographic, vertical and product mix; new product
introductions, and its efforts to optimize its operations and supply chain.

In the long term, improvements in ChargePoint's gross profit and gross margin
will depend on its ability to continue to optimize its operations and supply
chain as it increases its revenue. However, at least in the short term, as
ChargePoint continues to optimize for customer acquisition and prioritize
assurance of supply of its products as part of the "land-and-expand" model,
launches new Networked Charging Systems products, grows its presence in Europe
where it has not yet achieved economies of scale, and expands its solutions for
its fleet customers, it expects gross margin to experience pressure and
variability from period to period. In addition, ChargePoint expects

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gross margins will continue to be impacted by increased material, freight and logistics costs due to continued global supply chain disruptions and related measures.

                                        For the Year Ended January 31,                                                     Change
                                   2022                 2021              2020                      2022 vs 2021                             2021 vs 2020
                                                                                             Change               Change              Change               Change
                               (dollar amounts in thousands, except percentages)               ($)                 (%)                  ($)                 (%)
Gross Profit                 $    53,533             $ 32,949          $ 18,042          $     20,584               62.5  %       $     14,907               82.6  %
Gross Margin                        22.2     %           22.5  %           12.5  %


Gross profit increased for the fiscal year ended January 31, 2022 compared to
the same period in 2021 primarily due to an increase in Networked Charging
Systems sales that resulted from an increase in the number of Networked Charging
Systems delivered.

Gross margin slightly decreased for the fiscal year ended January 31, 2022
compared to the same period in 2021 as margins on Networked Charging Systems
sales from improved manufacturing efficiencies were offset by lower subscription
revenue margins primarily due to an increase in stock-based compensation
expense.

Research and development costs

Research and development expenses consist primarily of salaries and related
personnel expenses, including stock-based compensation, for personnel related to
the development of improvements and expanded features for ChargePoint's
services, as well as quality assurance, testing, product management,
amortization of capitalized internal-use software, and allocated facilities and
information technology expenses. Research and development costs are expensed as
incurred.

ChargePoint expects its research and development expenses to increase on an
absolute basis for the foreseeable future as ChargePoint continues to invest in
research and development activities to achieve its technology and product
roadmap.

                                        For the Year Ended January 31,                                                    Change
                                   2022                2021              2020                      2022 vs 2021                            2021 vs 2020
                                                                                            Change               Change              Change              Change
                              (dollar amounts in thousands, except percentages)               ($)                 (%)                 ($)                 (%)
Research and Development
Expenses                     $    145,043           $ 75,017          $ 69,464          $     70,026               93.3  %       $     5,553                8.0  %
Percentage of total revenue          60.2   %           51.2  %           

48.1%


Research and development expenses increased during the fiscal year ended
January 31, 2022 compared to the same period in 2021 and was primarily
attributable to a $23.7 million increase in stock-based compensation expense
from restricted stock unit ("RSU") grants, a $22.7 million increase in salary
and bonus expenses due to headcount growth, a $11.8 million increase in
engineering materials and services costs, a $3.3 million increase in consulting
services, as well as a $4.1 million increase in allocated costs.

Sales and marketing expenses

Sales and marketing expenses consist primarily of salaries and related personnel
expenses, including stock-based compensation, sales commissions, professional
services fees, travel, marketing and promotional expenses amortization of
capitalized internal-use software and allocated facilities and information
technology expenses.

ChargePoint expects its sales and marketing expenses to increase on an absolute
basis for the foreseeable future while it continues to add sales and marketing
personnel, expand its sales channels and expand in Europe.

                                       For the Year Ended January 31,                                                     Change
                                  2022                 2021              2020                      2022 vs 2021                             2021 vs 2020
                                                                                            Change               Change              Change               Change
                              (dollar amounts in thousands, except percentages)               ($)                 (%)                  ($)                 (%)
Sales and marketing
expenses                    $    92,550             $ 53,002          $ 56,997          $     39,548               74.6  %       $     (3,995)              (7.0) %
Percentage of total revenue        38.4     %           36.2  %           

39.4%


Sales and marketing expenses increased during the fiscal year ended January 31,
2022 compared to the same period in 2021 primarily attributable to a $18.1
million increase in salary, bonus and commissions due to headcount growth, a
$7.7 million increase in stock-based compensation expense resulting mainly from
RSU grants, a $3.2 million increase in amortization expense mainly due to
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acquisition of intangible assets related to customer relations resulting from business combinations,
$2.8 million increase in marketing expenses and a $2.0 million increase in consulting expenses.

General and administrative expenses

General and administrative expenses consist primarily of salaries and related
personnel expenses, including stock-based compensation, related to finance,
legal and human resource functions, contractor and professional services fees,
audit and compliance expenses, insurance costs, bad debt expenses, amortization
of capitalized internal-use software and general corporate expenses, including
allocated facilities and information technology expenses.

ChargePoint expects its general and administrative expenses to increase in
absolute dollars as it continues to grow its business and to operate as a public
company, including expenses necessary to comply with the rules and regulations
applicable to companies listed on a national securities exchange and related to
compliance and reporting obligations pursuant to the rules and regulations of
the SEC, as well as higher expenses for director and officer insurance, investor
relations and legal, accounting and other professional services.

                                          For the Year Ended January 31,                                                     Change
                                     2022                 2021              2020                      2022 vs 2021                             2021 vs 2020
                                                                                               Change               Change               Change              Change
                                 (dollar amounts in thousands, except percentages)               ($)                  (%)                 ($)                 (%)
General and administrative
expenses                       $    81,380             $ 25,922          $ 23,945          $     55,458               213.9  %       $     1,977                8.3  %
Percentage of total revenue           33.8     %           17.7  %           16.6  %


General and administrative expenses increased during the fiscal year ended
January 31, 2022 compared to the same period in 2021 primarily attributable to a
$27.4 million increase in stock-based compensation expense resulting from RSU
grants and stock option grants, a $7.6 million increase in salary expense due to
headcount growth, a $11.1 million increase in professional services fees related
to acquisitions and expenses associated with an underwritten secondary offering
of shares held by certain selling stockholders in July 2021, a $2.1 million
increase in ViriCiti Earnout liability and a $9.0 million increase in consulting
expenses.

Interest Income

Interest income consists primarily of interest earned on ChargePoint’s cash, cash equivalents and short-term investments.

                                           For the Year Ended January 31,                                                    Change
                                       2022                2021             2020                     2022 vs 2021                             2021 vs 2020
                                                                                              Change              Change               Change               Change
                                 (dollar amounts in thousands, except percentages)             ($)                  (%)                  ($)                  (%)
Interest income                  $        98            $   315          $ 3,245          $      (217)              (68.9) %       $     (2,930)              (90.3) %
Percentage of total revenue                -    %           0.2  %          

2.2%

Interest income decreased during the year ended January 31, 2022 compared to the same period in 2021, reflecting the low interest rate environment.

Interest charges

Interest expense primarily includes interest on ChargePoint’s term loan, which was repaid in March 2021.

                                            For the Year Ended January 31,                                                       Change
                                       2022                 2021              2020                      2022 vs 2021                              2021 vs 2020
                                                                                                 Change              Change                 Change                Change
                                   (dollar amounts in thousands, except percentages)              ($)                  (%)                   ($)                   (%)
Interest expense                 $    (1,502)            $ (3,253)         $ (3,544)         $     1,751               (53.8) %       $      291                    (8.2) %
Percentage of total revenue             (0.6)    %           (2.2) %           (2.5) %


Interest expense decreased during the fiscal year ended January 31, 2022
compared to the same period in 2021 primarily due to repayment of ChargePoint's
2018 term loan facility (the "2018 Loan") in March 2021. As of January 31, 2022,
ChargePoint had no outstanding loans.
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Change in fair value of liability related to redeemable convertible preferred share purchase warrants

Redeemable convertible preferred stock warrant liability is subject to
remeasurement to fair value at each balance sheet date. Changes in fair value of
redeemable convertible preferred stock warrant liability are recognized in the
consolidated statements of operations. ChargePoint adjusts the liability for
changes in fair value until the earlier of the exercise or expiration of the
warrants and conversion of redeemable convertible preferred stock into Common
Stock.

                                          Year Ended January 31,                                                Year-over-Year Change
                                 2022               2021              2020                     2022 to 2021                               2021 to 2020
                                   (dollar amounts in thousands, except                 Change               Change               Change                Change
                                               percentages)                              ($)                  (%)                   ($)                  (%)
Changes in fair value of
redeemable convertible
preferred stock warrant
liability                    $  9,237           $ (73,125)         $  (875)         $    82,362               (112.6) %       $    (72,250)              8257.1  %
Percentage of total revenue       3.8   %           (49.9) %          (0.6) %


The change in fair value of redeemable convertible preferred stock warrant
liability during fiscal year ended January 31, 2022 compared to the same period
in 2021 was primarily due to changes in the fair value of Legacy ChargePoint's
redeemable convertible preferred stock through the date of the Merger. As of
January 31, 2022, ChargePoint had no outstanding redeemable convertible
preferred stock warrant liabilities.

Change in fair value of contingent liabilities related to price supplements

Contingent earnout liability was accounted for as a liability as of the date of
the Merger and remeasured to fair value until the Earnout Triggering Events were
met for the first two tranches in March 2021 and the corresponding Earnout
Shares were issued. In March 2021, the remaining earnout liability for the third
tranche converted to be accounted for as equity. The Earnout Triggering Event
was met for the third and final tranche in June 2021, and in July 2021, the
remaining Earnout Shares were issued.

                                           Year Ended January 31,                                                  Year-over-Year Change
                                   2022                  2021             2020                      2022 to 2021                             2021 to 2020
                                                                                             Change                Change              Change             Change
                              (dollar amounts in thousands, except percentages)                ($)                   (%)                ($)   
            (%)
Changes in fair value of
earnout liability           $     84,420              $     -          $     -          $       84,420               100.0  %       $       -                  -  %
Percentage of total revenue         35.0      %             -  %             -  %


ChargePoint recognized an increase in fair value of contingent earnout liability
of $84.4 million for the fiscal year ended January 31, 2022 due to the decrease
in the fair value of ChargePoint's Common Stock after consummation of the
Merger.

Transaction costs expensed

Transaction costs consist of legal, accounting, banking fees and other costs
that were directly related to the consummation of the Merger. Transaction costs
related to the issuance of shares were recognized in stockholders' equity
(deficit) while costs associated with the warrant liabilities and
non-capitalized amounts were expensed in the consolidated statements of
operations upon the completion of the Merger on February 26, 2021.

                                                      Year Ended January 31,                                                  Year-over-Year Change
                                              2022                  2021             2020                      2022 to 2021                             2021 to 2020
                                                                                                        Change                Change              Change             Change
                                         (dollar amounts in thousands, except percentages)                ($)                   (%)                ($)                (%)
Transaction costs expensed             $     (7,031)             $     -          $     -          $       (7,031)              100.0  %       $       -                  -  %
Percentage of total revenue                    (2.9)     %             -  %             -  %


During the year ended January 31, 2022, Charging point spent $7.0 million
out of $36.5 million the total transaction costs related to the warrant liabilities assumed in connection with the Merger.

Other income (expenses), net

Other income (expenses), net, consists mainly of gains and losses on foreign currency transactions.

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                                                    Year Ended January 31,                                                      Year-over-Year Change
                                            2022                2021             2020                         2022 to 2021                                   2021 to 2020
                                                                                                      Change                  Change                  Change                 Change
                                       (dollar amounts in thousands, except percentages)               ($)                      (%)                    ($)                    (%)
Other income (expense), net            $   (2,775)           $   229          $  (565)         $     (3,004)                   (1311.8) %       $      794                    (140.5) %
Percentage of total revenue                  (1.2)   %           0.2  %     

(0.4)%

Other income (expenses), net from $0.2 million during the year ended
January 31, 2021 for ($2.8) million during the year ended January 31, 2022 due to unfavorable changes in exchange rates.

Provision for income taxes

ChargePoint's provision for income taxes consists of federal, state and foreign
income taxes based on enacted federal, state and foreign tax rates, as adjusted
for allowable credits, deductions, uncertain tax positions, changes in deferred
tax assets and liabilities and changes in tax law. Due to the level of
historical losses, ChargePoint maintains a valuation allowance against U.S.
federal and state deferred tax assets as it has concluded it is more likely than
not that these deferred tax assets will not be realized.

                                             Year Ended January 31,                                                       Year-over-Year Change
                                     2022                 2021             2020                         2022 to 2021                                    2021 to 2020
                                                                                                Change                   Change                  Change                Change
                                (dollar amounts in thousands, except percentages)                ($)                      (%)                     ($)                    (%)
Provision (benefit) for income
taxes                          $     (2,930)           $   198          $   224          $     (3,128)                    (1579.8) %       $      (26)                   (11.6) %
Percentage of loss before
provision (benefit) for income
taxes                                   2.2    %          (0.1) %          

(0.2)%


The benefit for income taxes increased during the fiscal year ended January 31,
2022 as compared to the same period in 2021 due to valuation allowance release
and losses from the acquisitions in the current year.

Cash and capital resources

Sources of liquidity

ChargePoint has incurred net losses and negative cash flows from operations
since its inception, which it anticipates will continue for the foreseeable
future. To date, ChargePoint has funded its business and the acquisitions of
ViriCiti and HTB primarily with proceeds from the issuance of redeemable
convertible preferred stock, proceeds from the Merger, proceeds from warrant and
option exercises for cash and from customer payments. As of January 31, 2022 and
2021, ChargePoint had cash, cash equivalents and restricted cash of $315.6
million and $145.9 million, respectively. ChargePoint believes that its cash on
hand and cash generated from sales to customers will satisfy its working capital
and capital requirements for at least the next twelve months.

From inception to January 31, 2022, ChargePoint has raised aggregate net cash
proceeds of $615.7 million from the sale of shares of redeemable convertible
preferred stock and $479.2 million from the Merger and the concurrent purchase
by certain investors of shares of Common Stock pursuant to separate subscription
agreements (the "PIPE financing"). During the fiscal year ended January 31,
2022, ChargePoint received $118.9 million in proceeds from warrant exercises.

In March 2021, ChargePoint repaid the entire 2018 Loan balance of $35.0 million
plus accrued interest and prepayment fees of $1.2 million. As of January 31,
2022, ChargePoint had no outstanding loans.

Long-term liquidity requirements

Until ChargePoint can generate sufficient revenue to cover its cost of sales,
operating expenses, working capital and capital expenditures, it expects to
primarily fund cash needs through a combination of equity and debt financing. If
ChargePoint raises funds by issuing equity securities or debt securities
convertible into equity securities, dilution to stockholders may result. Any
equity securities issued may also provide for rights, preferences or privileges
senior to those of holders of Common Stock. If ChargePoint raises funds by
issuing debt securities, these debt securities would have rights, preferences
and privileges senior to those of holders of Common Stockholders. The terms of
debt securities or borrowings could impose significant restrictions on
ChargePoint's operations. The capital markets have in the past, and may in the
future, experience periods of higher volatility that could impact the
availability and cost of equity and debt financing.

ChargePoint’s The primary use of cash in recent periods has been to fund its operations, the acquisitions of ViriCiti and HTB, and to invest in capital expenditures. ChargePoint’s future capital requirements will depend on many factors, including revenue growth

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rate, the timing and the amount of cash received from customers, the expansion
of sales and marketing activities, the timing and extent of spending to support
development efforts, expenses associated with its international expansion, the
introduction of network enhancements and the continuing market adoption of its
network. In the future, ChargePoint may enter into arrangements to acquire or
invest in complementary businesses, products and technologies. ChargePoint may
be required to seek additional equity or debt financing.

If ChargePoint requires additional financing, it may not be able to raise such
financing on acceptable terms or at all. If ChargePoint is unable to raise
additional capital or generate cash flows necessary to expand its operations and
invest in continued innovation, it may not be able to compete successfully,
which would harm its business, results of operations and financial condition. If
adequate funds are not available, ChargePoint may need to reconsider its
expansion plans or limit its research and development activities, which could
have a material adverse impact on its business prospects and results of
operations.

Cash flow

For closed fiscal years January 31, 20222021 and 2020

The following table sets forth a summary of ChargePoint's cash flows for the
periods indicated:

                                                                    Year Ended January 31,
                                                         2022                2021               2020
                                                                        (in thousands)
Net cash (used in) provided by:
Operating activities                                 $ (157,178)         $ (91,846)         $  (87,936)
Investing activities                                   (221,740)            35,530             (61,899)
Financing activities                                    549,687            128,913              17,158

Effects of exchange rates on cash, cash equivalents and restricted cash

                                      (1,025)               141                 132
Net increase (decrease) in cash, cash equivalents
and restricted cash                                  $  169,744          $  

72,738 ($132,545)

Net cash used in operating activities

During the year ended January 31, 2022, net cash used in operating activities
was $157.2 million, consisting primarily of a net loss of $132.2 million and
non-cash charges of $42.0 million, partially offset by a change in operating
assets and liabilities of $17.1 million. The non-cash charges consisted
primarily of a $84.4 million change in the fair value of contingent earnout
liability and a $57.1 million change in the fair value of warrant liabilities,
offset by a $67.3 million stock-based compensation expense, a $16.5 million
depreciation and amortization, and $7.0 million transaction costs related to the
consummation of the Merger. The change in operating assets and liabilities was
mainly driven by increases in deferred revenue of $55.3 million, accrued and
other liabilities of $21.6 million and accounts payable of $7.9 million,
partially offset by an increase in accounts receivable of $38.4 million and
prepaid expenses and other assets of $23.9 million and a decrease in operating
lease liabilities of $3.5 million.

During the year ended January 31, 2021, net cash used in operating activities
was $91.8 million, consisting primarily of a net loss of $197.0 million,
partially offset by a decrease in net operating assets of $10.2 million and
non-cash charges of $95.0 million. The decrease in net operating assets was due
to a $17.2 million increase in deferred revenue, a $11.6 million increase in
accrued and other liabilities and a $3.3 million decrease in accounts
receivable, net due to increased collections, largely offset by a $8.9 million
increase in prepaid expenses and other assets, a $9.6 million increase in
inventory, a $2.8 million decrease in operating lease liabilities and a $0.5
million decrease in accounts payable. The non-cash charges primarily consisted
of a $73.1 million change in the fair value of redeemable convertible preferred
stock warrant liability, $10.1 million of depreciation and amortization expense,
$4.9 million of stock-based compensation expense and $3.8 million of non-cash
operating lease cost.

Net cash provided by (used in) investing activities

During the year ended January 31, 2022, net cash used in investing activities
was $221.7 million consisting of cash paid for acquisitions, net of cash
acquired, of $205.3 million and purchases of property and equipment of $16.4
million.

During the year ended January 31, 2021net cash from investing activities was $35.5 millioncomposed of the maturities of the investments of $47.0 millionpartially offset by purchases of property, plant and equipment of $11.5 million.

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Net cash provided by financing activities

During the year ended January 31, 2022, net cash provided by financing
activities was $549.7 million, consisting of net proceeds from the Merger and
PIPE financing of $511.6 million, proceeds from the exercise of warrants of
$118.9 million and proceeds from exercises of vested and unvested stock options
of $4.9 million and change in driver funds and amounts due to customers of $3.7
million, partially offset by repayment of borrowings of $36.1 million, payment
of transaction costs related to the Merger of $32.5 million and payment of tax
withholding obligations on settlement of earnout shares of $20.9 million.

During the year ended January 31, 2021, net cash provided by financing
activities was $128.9 million, consisting of net proceeds from the issuance of
Legacy ChargePoint redeemable convertible preferred stock of $95.5 million,
proceeds from the issuance of Legacy ChargePoint common stock warrants of $31.5
million and proceeds from exercises of vested and unvested stock options of $5.9
million, partially offset by $4.0 million of payment of deferred transaction
costs.

Contractual obligations and commitments

ChargePoint’s significant cash requirements include the following contractual obligations and commitments as of January 31, 2022. For more information regarding ChargePoint’s other contractual obligations, see note 8 of its consolidated financial statements included elsewhere in this annual report.

Operating lease obligations

Charging point has operating lease obligations for office space and data centers. From January 31, 2022, Charging point had lease payment obligations, net of sublease income, $38.0 millionwith $6.3 million payable within twelve months.

Purchase commitments

ChargePoint enters into purchase commitments that include purchase orders and
agreements in the normal course of business with contract manufacturers, parts
manufacturers, vendors for research and development services and outsourced
services.

Purchase commitments at January 31, 2022 has been $167.0 millionwith $165.4 million payable within 12 months.

Significant Accounting Policies and Estimates

Management's discussion and analysis of ChargePoint's financial condition and
results of operations is based on its consolidated financial statements, which
have been prepared in accordance with U.S. GAAP. The preparation of these
consolidated financial statements requires ChargePoint to make estimates and
assumptions for the reported amounts of assets, liabilities, revenue, expenses
and related disclosures. ChargePoint's estimates are based on its historical
experience and on various other factors that it believes are reasonable under
the circumstances, the results of which form the basis for making judgments
about the carrying value of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates under
different assumptions or conditions and any such differences may be material.

While ChargePoint's significant accounting policies are described in more detail
in Note 2 to its consolidated financial statements included elsewhere in this
Annual Report, it believes the following accounting policies and estimates to be
most critical to the preparation of its consolidated financial statements.

Revenue recognition

ChargePoint recognizes revenue using the five-step model in determining revenue
recognition: (a) identification of the contract, or contracts, with a customer;
(b) identification of the performance obligations in the contract; (c)
determination of the transaction price; (d) allocation of the transaction price
to the performance obligations in the contract; and (e) recognition of revenue
when, or as, it satisfies a performance obligation.

ChargePoint enters into contracts with customers that regularly include promises
to transfer multiple products and services, such as charging systems, software
subscriptions, extended maintenance, and professional services. For arrangements
with multiple products and services, ChargePoint evaluates whether the
individual products and services qualify as distinct performance obligations. In
ChargePoint's assessment of whether products and services are a distinct
performance obligation, it determines whether the customer can benefit from the
product or service on its own or with other readily available resources and
whether the service is separately identifiable from other products or services
in the contract. This evaluation requires ChargePoint to assess the nature of
each of its Networked Charging Systems, subscriptions and other offerings and
how they are provided in the context of the contract, including whether they are
significantly integrated which may require judgment based on the facts and
circumstances of the contract.
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The transaction price for each contract is determined based on the amount
ChargePoint expects to be entitled to receive in exchange for transferring the
promised products or services to the customer. Collectability of revenue is
reasonably assured based on historical evidence of collectability of fees
ChargePoint charges its customers. The transaction price in the contract is
allocated to each distinct performance obligation in an amount that represents
the relative amount of consideration expected to be received in exchange for
satisfying each performance obligation. Revenue is recognized when performance
obligations are satisfied. Revenue is recorded based on the transaction price
excluding amounts collected on behalf of third parties such as sales taxes,
which are collected on behalf of and remitted to governmental authorities, or
driver fees,which are collected on behalf of customers who offer public charging
for a fee.

When agreements involve multiple distinct performance obligations, ChargePoint
accounts for individual performance obligations separately if they are distinct.
ChargePoint applies significant judgment in identifying and accounting for each
performance obligation, as a result of evaluating terms and conditions in
contracts. The transaction price is allocated to the separate performance
obligations on a relative standalone selling price ("SSP") basis. ChargePoint
determines SSP based on observable standalone selling price when it is
available, as well as other factors, including the price charged to its
customers, its discounting practices and its overall pricing objectives, while
maximizing observable inputs. In situations where pricing is highly variable, or
a product is never sold on a stand-alone basis, ChargePoint estimates the SSP
using the residual approach.

Areas of judgment and estimates

Determining whether the Networked Charging Systems, Cloud, Assure and
professional services are considered distinct performance obligations that
should be accounted for separately or as a single performance obligation
requires significant judgment. In reaching its conclusion, ChargePoint assesses
the nature of each individual service offering and how the services are provided
in the context of the contract, including whether the services are significantly
integrated, which may require judgment based on the facts and circumstances of
the contract.

Determining the relative SSP for contracts that contain multiple performance
obligations requires significant judgment. ChargePoint determines SSP using
observable pricing when available, which takes into consideration market
conditions and customer specific factors while maximizing observable inputs.
When observable pricing is not available, ChargePoint first allocates to the
performance obligations with established SSPs and then applies the residual
approach to allocate the remaining transaction price.

Inventory

Inventory is stated at the lower of cost or net realizable value. Cost is
computed using standard cost, which approximates actual cost, on a first-in,
first-out basis. Inventory levels are analyzed periodically and written down to
their net realizable value if they have become obsolete, have a cost basis in
excess of expected net realizable value or are in excess of expected demand.
ChargePoint analyzes current and future product demand relative to the remaining
product life to identify potential excess inventories. These forecasts of future
demand are based upon historical trends and adjusted for overall market
conditions. Inventory write-downs are measured as the difference between the
cost of the inventory and its net realizable value, and charged to inventory
reserves, which is a component of cost of revenue. At the point of the loss
recognition, a new, lower cost basis for those inventories is established, and
subsequent changes in facts and circumstances do not result in the restoration
or increase in that newly established cost basis.

Trade suit

Business combinations are accounted for under the acquisition method. Assets
acquired and liabilities assumed as part of a business acquisition are generally
recorded at their estimated fair value at the date of acquisition. The excess of
purchase price over the amount allocated to the assets acquired and liabilities
assumed, if any, is recorded as goodwill. In determining the fair value of
assets acquired, including intangible assets, and liabilities assumed,
ChargePoint utilizes a variety of methods. Each asset acquired and liability
assumed is measured at fair value from the perspective of a market participant.
The method used to estimate the fair values of intangible assets incorporates
significant estimates and assumptions regarding the estimates a market
participant would make in order to evaluate an asset, including a market
participant's use of the asset, future cash inflows and outflows, probabilities
of success, asset lives and the appropriate discount rates. This judgment and
determination affects the amount of consideration paid that is allocated to
assets acquired and liabilities assumed in the business purchase transaction.The
Company engages third-party appraisal firms to assist in determining fair value
of assets acquired and liabilities assumed when appropriate.

During the remeasurement period, which extends no later than one year from the
acquisition date, ChargePoint may record certain adjustments to the carrying
value of the assets acquired and liabilities assumed with a corresponding offset
to goodwill.

Stock-based Compensation

In determining the grant date fair value of options using the Black-Scholes option pricing model, management must make certain assumptions and judgments. These estimates are subject to inherent uncertainties and, had different assumptions been used, the stock-based compensation expense could have been materially different from the amounts recognized. Stock-based compensation is valued at

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the grant date, based on the fair value of the award and is recognized as an
expense, net of estimated forfeitures, on a straight-line basis over the
requisite service period. ChargePoint estimates the forfeiture rate based on the
historical experience at the date of grant and revises it, if necessary, in
subsequent periods if actual forfeitures differ from those estimates. For
performance-based stock options issued, the value of the award is measured at
the grant date as the fair value of the award and is expensed over the requisite
service period, using the accelerated attribution method, once the performance
condition becomes probable of being achieved. These inputs are subjective and
generally required significant analysis and judgment to develop.

The determination of the grant date fair value of stock option awards issued is
affected by a number of variables, including the fair value of ChargePoint's
underlying Common Stock, expected Common Stock price volatility over the term of
the option award, the expected term of the award, risk-free interest rates, and
the expected dividend yield of ChargePoint Common Stock.

•Fair value of the underlying common stock: For the fiscal year ended January
31, 2021 and 2020, the absence of a public market for Legacy ChargePoint's
common stock required its board of directors to estimate the fair value of its
common stock for purposes of granting options and for determining stock-based
compensation expense by considering several objective and subjective factors,
including contemporaneous third-party valuations, actual and forecasted
operating and financial results, market conditions and performance of comparable
publicly traded companies, developments and milestones in Legacy ChargePoint,
the rights and preferences of common and redeemable convertible preferred stock,
and transactions involving the Legacy ChargePoint's stock. The fair value of the
Legacy ChargePoint's common stock was determined in accordance with applicable
elements of the American Institute of Certified Public Accountants guide,
Valuation of Privately Held Company Equity Securities Issued as Compensation.

•Expected volatility (Stock Options): As Legacy ChargePoint was not publicly
traded, the expected volatility for Legacy ChargePoint's stock options were
determined by using an average of historical volatilities of selected industry
peers deemed to be comparable to the Legacy ChargePoint's business corresponding
to the expected term of the awards. The Company did not grant any options during
the year ended January 31, 2022.

•Expected volatility (Employee Stock Purchase Plan): The expected volatility for
employee stock purchase plan was determined by using a blended volatility
approach of peer volatility and implied volatility. Peer volatility was
calculated as the average of historical volatilities of selected industry peers
deemed to be comparable to ChargePoint's business corresponding to the expected
term of the awards.

• Risk-free interest rate: the risk-free interest rate is based on we
Treasury yield curve in force at the time of the allocation of the zero-coupon we
Treasury Notes with maturities matching the expected term of the awards.

•Expected dividend yield: The expected dividend rate is zero as ChargePoint
currently has no history or expectation of declaring dividends on its Common
Stock.

•Expected term: The expected term represented the period these stock awards were
expected to remain outstanding and is based on historical experience of similar
awards, giving consideration to the contractual terms of the stock-based awards,
vesting schedules, and expectations of future employee behavior.

Valuation of common shares

The fair value of Legacy ChargePoint common stock has always been determined by the Board of Directors with the assistance of management.

In the absence of a public trading market for Legacy ChargePoint Common Stock,
on each grant date, Legacy ChargePoint developed an estimate of the fair value
of Legacy ChargePoint common stock based on the information known on the date of
grant, upon a review of any recent events and their potential impact on the
estimated fair value per share of ChargePoint Common Stock, and in part on input
from contemporaneous third- party valuations.

ChargePoint's valuations of Legacy ChargePoint Common Stock was determined in
accordance with the guidelines outlined in the American Institute of Certified
Public Accountants Practice Aid, Valuation of Privately-Held-Company Equity
Securities Issued as Compensation.

The assumptions used to determine the estimated fair value of Legacy ChargePoint
Common Stock are based on numerous objective and subjective factors, combined
with management's judgment, including:

• contemporaneous third-party valuations of its ordinary shares;

•external market conditions affecting the EV industry and trends within the industry;

•the rights, preferences and privileges of Legacy ChargePoint redeemable convertible preferred stock over those of Legacy ChargePoint common stock;

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• the prices at which it sold Legacy ChargePoint convertible redeemable preferred stock and Legacy ChargePoint common stock;

•the prices paid in secondary transactions involving its capital stock and the
facts and circumstances of each transaction to determine the extent to which
they represented a fair value exchange, such as transaction volume, timing,
whether the transactions occurred among willing and unrelated parties, and
whether the transactions involved investors with access to its financial
information;

•its financial condition and results of operations, including its levels of available capital resources;

•the progress of its research and development efforts and its stage of development and its commercial strategy;

•the likelihood of a liquidity event, such as an initial public offering or sale of Legacy ChargePoint, taking into account prevailing market conditions;

•the history and nature of its activities, industry trends and the competitive environment;

•the lack of marketability of Legacy ChargePoint common stock;

•equity market conditions affecting comparable public companies; and

•general we and world market conditions.

In determining the fair value of Legacy ChargePoint Common Stock, Legacy
ChargePoint established the enterprise value of its business using the market
approach and the income approach. Legacy ChargePoint also estimated the
enterprise value by reference to the closest round of equity financing preceding
the date of the valuation if such financing took place around the valuation
date. Under the income approach, forecasted cash flows are discounted to the
present value at a risk-adjusted discount rate. The valuation analyses determine
discrete free cash flows over multiple years based on forecasted financial
information provided by its management and a terminal value for the residual
period beyond the discrete forecast, which are discounted at its estimated
weighted-average cost of capital to estimate its enterprise value. Under the
market approach, a group of guideline publicly-traded companies with similar
financial and operating characteristics to Legacy ChargePoint were selected, and
valuation multiples based on the guideline public companies' financial
information and market data were calculated. Based on the observed valuation
multiples, an appropriate multiple was selected to apply to Legacy ChargePoint's
historical and forecasted revenue results.

In allocating the equity value of Legacy ChargePoint's business among the
various classes of equity securities prior to July 2020, it used the option
pricing model ("OPM") method, which models each class of equity securities as a
call option with a unique claim on its assets. The OPM treats Legacy ChargePoint
Common Stock and redeemable convertible preferred stock as call options on an
equity value with exercise prices based on the liquidation preference of its
redeemable convertible preferred stock. The common stock is modeled as a call
option with a claim on the equity value at an exercise price equal to the
remaining value immediately after its redeemable convertible preferred stock is
liquidated. The exclusive reliance on the OPM until July 2020 was appropriate
when the range of possible future outcomes was difficult to predict and resulted
in a highly speculative forecast.

Since July 2020, Legacy ChargePoint used a hybrid method utilizing a combination
of the OPM and the probability weighted expected return method ("PWERM"). The
PWERM is a scenario-based methodology that estimates the fair value of common
stock based upon an analysis of future values for Legacy ChargePoint, assuming
various outcomes. The common stock value is based on the probability-weighted
present value of expected future investment returns considering each of the
possible outcomes available as well as the rights of each class of shares. The
future value of the common stock under each outcome is discounted back to the
valuation date at an appropriate risk-adjusted discount rate and probability
weighted to arrive at an indication of value for the common stock. Legacy
ChargePoint considered three different scenarios: (a) a transaction with a SPAC,
(b) remaining a private company and (c) an acquisition by another company. Under
the hybrid method, Legacy ChargePoint used the OPM, the if-converted method, and
the liquidation method to allocate the equity value of its business among the
various classes of stock. The if-converted method presumes that all shares of
Legacy ChargePoint redeemable convertible preferred stock convert into Legacy
ChargePoint Common Stock based upon their conversion terms and differences in
the rights and preferences of the share of Legacy ChargePoint redeemable
convertible preferred stock are ignored. The liquidation method presumes payment
of proceeds in accordance with the liquidation terms of each class of stock.

After the allocation to the various classes of equity securities, a discount for
lack of marketability ("DLOM") was applied to arrive at a fair value of common
stock. A DLOM was meant to account for the lack of marketability of a stock that
was not publicly traded. In making the final determination of common stock
value, consideration was also given to recent sales of common stock.

Application of these approaches and methodologies involves the use of estimates,
judgments and assumptions that are highly complex and subjective, such as those
regarding Legacy ChargePoint's expected future revenue, expenses and future cash
flows, discount rates, market multiples, the selection of comparable public
companies and the probability of and timing associated with possible future
events. Changes in any or all of these estimates and assumptions or the
relationships between those assumptions impacted Legacy ChargePoint's valuations
as of each valuation date and may have had a material impact on the valuation of
Legacy ChargePoint Common Stock.
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Income taxes

ChargePoint utilizes the asset and liability method in accounting for income
taxes. Deferred tax assets and liabilities reflect the estimated future tax
consequences of temporary differences between the financial reporting and tax
bases of assets and liabilities. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered or
settled. Deferred tax expense or benefit is the result of changes in the
deferred tax asset and liability. Valuation allowances are established when
necessary to reduce deferred tax assets where it is more likely than not that
the deferred tax assets will not be realized. ChargePoint makes estimates,
assumptions and judgments to determine its provision for its income taxes,
deferred tax assets and liabilities, and any valuation allowance recorded
against deferred tax assets. ChargePoint assesses the likelihood that its
deferred tax assets will be recovered from future taxable income, and to the
extent it believes that recovery is not likely, it establishes a valuation
allowance.

ChargePoint recognizes the tax benefit from an uncertain tax position only if it
is more likely than not that the tax position will be sustained on examination
by the taxing authorities, based on the technical merits of the position. The
tax benefits recognized from such positions are then measured based on the
largest benefit that has a greater than 50% likelihood of being realized upon
settlement. Interest and penalties related to unrecognized tax benefits which,
have not been material, are recognized within provision for income taxes.

Recent accounting pronouncements

See Note 2, Summary of Significant Accounting Policies, to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K for more information on recently issued accounting pronouncements.

Accounting Election for Emerging Growth Companies

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being
required to comply with new or revised financial accounting standards until
private companies are required to comply with the new or revised financial
accounting standards. The JOBS Act provides that a company can choose not to
take advantage of the extended transition period and comply with the
requirements that apply to non-emerging growth companies, and any such election
to not take advantage of the extended transition period is irrevocable.

Prior to January 31, 2022, ChargePoint was an "emerging growth company" as
defined in Section 2(A) of the Securities Act of 1933, as amended, and elected
to take advantage of the benefits of this extended transition period for new or
revised financial accounting standards. ChargePoint had taken advantage of the
benefits of the extended transition period, although it may have decided to
early adopt such new or revised standards to the extent permitted by such
standards. In addition, ChargePoint relied on other exemptions and reduced
reporting requirements provided by the JOBS Act. This may make it difficult or
impossible to compare ChargePoint financial results with the financial results
of another public company that is either not an emerging growth company or is an
emerging growth company that has chosen not to take advantage of the extended
transition period exemptions because of the potential differences in accounting
standards used.

Effective January 31, 2022, Charging point has exited its Emerging Growth Company status and has met the definition of an Accelerated Large Filer, as defined by Rule 12-b-2 of the Exchange Act. The accommodation granted to an emerging growth business will no longer apply.

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