Segment and Revenue Disclosures
|12 Months Ended|
Dec. 31, 2021
|Revenue from Contract with Customer [Abstract]|
|Segment and Revenue Disclosures||Segment and Revenue Disclosures
The Company operates in a single operating segment. An operating segment is defined as a component of an enterprise for which discrete financial information is available and is regularly reviewed by the chief operating decision maker (CODM). The Company’s CODM is its Chief Executive Officer as he is responsible for making decisions regarding resource allocation and assessing the Company’s performance.
Revenue by geographic region is based on the delivery address of the customer and is summarized in the below table (in thousands):
The Company’s revenue from the United States was $85.3 million, $61.0 million and $45.8 million, for the years ended 2021, 2020 and 2019, respectively. The Company’s revenue from the United Kingdom was $17.1 million, $15.1 million and $17.6 million, for the years ended December 31, 2021, 2020 and 2019, respectively. No other individual country exceeded 10% of the Company’s total annual revenue.
Disaggregation of revenue
The principal category the Company uses to disaggregate revenues is the nature of the Company’s products and services as presented in the consolidated statements of operations, the total of which is reconciled to the consolidated revenue from the Company’s single reportable segment. In the following table, revenue is presented by software license and service categories (in thousands):
Contract assets and deferred revenue
Contract assets and deferred revenue from contracts with customers were as follows (in thousands):
Generally, the Company invoices its customers at the time a customer enters into a binding contract. However, the Company may offer invoicing and payment installments for certain multi-year arrangements. In these instances, timing of revenue recognition may differ from the timing of invoicing to customers. Contract assets are recorded when revenue is recognized prior to invoicing. Contract assets are transferred to accounts receivable upon customer invoicing. Beginning of the year contract asset amounts transferred to accounts receivable during the period were $11.0 million and $6.9 million for the years ended December 31, 2021 and 2020, respectively.
Deferred revenue is recorded when invoicing occurs before revenue is recognized. Deferred revenue recognized that was included in the deferred revenue balance at the beginning of the year was $49.7 million and $39.5 million for the years ended December 31, 2021 and 2020, respectively.
Remaining Performance Obligations
Remaining Performance Obligations (“RPO”) represents transaction price allocated to still unsatisfied or partially satisfied performance obligations. Those obligations are recorded as deferred revenue or are contractually stated or committed orders under multi-year billing plans for subscription and perpetual licenses, SaaS, or support and maintenance contracts for which the associated deferred revenue has not yet been recorded.
As of December 31, 2021, total remaining non-cancellable performance obligations under the Company’s subscriptions and perpetual license contracts with customers was approximately $151.6 million. Of this amount, the Company expects to recognize revenue of approximately $96.0 million or 63%, over the next 12 months, with the balance to be recognized as revenue thereafter.
The Company excludes the transaction price allocated to remaining performance obligations that have original expected durations of one year or less such as professional services and training.
The following table summarizes the account activity of deferred commissions for the year ended December 31, 2021 and 2020:
The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef