United States securities and exchange commission logo
February 23, 2024
John Ederer
Chief Financial Officer
Model N, Inc.
777 Mariners Island Boulevard, Suite 300
San Mateo, CA 94404
Re: Model N, Inc.
Form 10-K for the
Fiscal Year Ended September 30, 2023
Form 8-K Furnished
on February 6, 2024
File No. 001-35840
Dear John Ederer:
We have limited our review of your filings to the financial
statements and related
disclosures and have the following comments.
Please respond to this letter within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe a
comment applies to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to this letter, we may have additional comments.
Form 10-K for the Fiscal Year Ended September 30, 2023
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Key Business Metrics, page 41
1. We note you provide
metrics such as ARR and Net Dollar Retention only for your SaaS
revenues, which based
on your February 26, 2024 Investor Presentation represents
approximately 69% of
total subscription revenue in fiscal 2023 or 51% of total revenue.
Please tell us what
measures you use to monitor your other recurring revenue streams,
such as subscription
services revenue, and revise to include a quantified discussion of
such measures, if any.
Also, revise your discussion of the current metrics provided to
disclose the percentage
of total revenue that these measures represent for each period
presented.
2. You state that SaaS Net
Dollar Retention is calculated using the SaaS ARR from
customers that are in
both the current period and the year-ago period. While we note that
new customers during
the current period are not factored into the calculation, please tell us
John Ederer
Model N, Inc.
February 23, 2024
Page 2
whether customers that were lost since the year-ago period are considered
in this measure.
If so, revise your disclosures to clarify as such. If lost customers are
not included in this
metric, explain further how this measure is a reflection of customer
retention. Lastly,
revise to discuss the factors that contributed to any significant
fluctuations in this measure
from period to period.
Notes to Consolidated Financial Statements
Note 3. Revenue from Contracts with Customers
Remaining Performance Obligations, page 68
3. You disclose that the company expects to recognize as revenue over the
next 12 months
approximately 43% of the unsatisfied or partially satisfied performance
obligations with
the remainder being recognized thereafter. Please revise to disclose when
the remaining
56% will be recognized on a quantitative basis using time bands that
would be most
appropriate for the duration of the remaining performance obligations or
by providing
qualitative information. Refer to ASC 606-10-50-13.
Form 8-K Furnished on February 6, 2024
Exhibit 99.1
Reconciliation of GAAP to Non-GAAP Operating Results, page 8
4. We note that your measure of non-GAAP net income does not appear to
include the tax
impact of your non-GAAP adjustments. Please revise to include a separate
income tax
adjustment commensurate with your non-GAAP measure of profit. Refer to
Non-GAAP
C&DI Question 102.11.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
Please contact Melissa Kindelan at 202-551-3564 or Kathleen Collins at
202-551-3499
with any questions.
Sincerely,
FirstName LastNameJohn Ederer
Division of
Corporation Finance
Comapany NameModel N, Inc.
Office of
Technology
February 23, 2024 Page 2
cc: Errol Hunter
FirstName LastName