REVENUES

6 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

REVENUES

REVENUES

Disaggregation of Revenue

We have four revenue streams: cloud services and subscriptions, customer support, license, and professional service and other. The following tables disaggregate our revenue by significant geographic area, based on the location of our direct end customer, by type of performance obligation and timing of revenue recognition for the periods indicated:

	Three Months Ended December 31,				Six Months Ended December 31,
	2023		2022		2023		2022
Total Revenues by Geography:
Americas (1)	$	884,287	$	583,602	$	1,729,514	$	1,141,390
EMEA (2)	504,885		235,305		950,325		463,658
Asia Pacific (3)	145,696		78,533		280,458		144,428
Total revenues	$	1,534,868	$	897,440	$	2,960,297	$	1,749,476
Total Revenues by Type of Performance Obligation:
Recurring revenues (4)
Cloud services and subscriptions revenue	$	450,091	$	408,674	$	901,105	$	813,325
Customer support revenue	695,762		316,508		1,393,475		633,859
Total recurring revenues	$	1,145,853	$	725,182	$	2,294,580	$	1,447,184
License revenue (perpetual, term and subscriptions)	289,238		107,960		462,264		170,508
Professional service and other revenue	99,777		64,298		203,453		131,784
Total revenues	$	1,534,868	$	897,440	$	2,960,297	$	1,749,476
Total Revenues by Timing of Revenue Recognition:
Point in time	$	289,238	$	107,960	$	462,264	$	170,508
Over time (including professional service and other revenue)	1,245,630		789,480		2,498,033		1,578,968
Total revenues	$	1,534,868	$	897,440	$	2,960,297	$	1,749,476

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(1)Americas consists of countries in North, Central and South America.

(2)EMEA consists of countries in Europe, the Middle East and Africa.

(3)Asia Pacific primarily consists of Japan, Australia, China, Korea, Philippines, Singapore, India and New Zealand.

(4)Recurring revenue is defined as the sum of Cloud services and subscriptions revenue and Customer support revenue.

Contract Balances

A contract asset, net of allowance for credit losses, will be recorded if we have recognized revenue but do not have an unconditional right to the related consideration from the customer. For example, this will be the case if implementation services offered in a cloud arrangement are identified as a separate performance obligation and are provided to a customer prior to us being able to bill the customer. In addition, a contract asset may arise in relation to subscription licenses if the license revenue that is recognized upfront exceeds the amount that we are able to invoice the customer at that time. Contract assets are reclassified to accounts receivable when the rights become unconditional.

The balance for our contract assets and contract liabilities (i.e. deferred revenues) for the periods indicated below were as follows:

	As of December 31, 2023		As of June 30, 2023
Short-term contract assets (1)	$	70,656	$	71,196
Long-term contract assets (1)	$	45,427	$	64,553
Short-term deferred revenues (1)	$	1,535,322	$	1,721,781
Long-term deferred revenues (1)	$	170,273	$	217,771

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(1)Excludes $4.9 million of short-term contract assets and $2.7 million of long-term contract assets that have been reclassified to Assets held for sale, as well as $172.8 million of short-term deferred revenues and $23.1 million of long-term deferred revenues that have been reclassified to Liabilities held for sale as of December 31, 2023, related to the proposed divestiture of the AMC business. See Note 19 “Acquisitions and Divestitures.”

The difference in the opening and closing balances of our contract assets and deferred revenues, excluding the impact of assets held for sale, primarily results from the timing difference between our performance and the customer’s payments. We fulfill our obligations under a contract with a customer by transferring products and services in exchange for consideration from the customer. During the six months ended December 31, 2023, we reclassified $58.5 million (six months ended December 31, 2022 — $20.2 million) of contract assets to receivables as a result of the right to the transaction consideration becoming unconditional. During the three and six months ended December 31, 2023 and 2022, respectively, there was no significant impairment loss recognized related to contract assets.

We recognize deferred revenue when we have received consideration or an amount of consideration is due from the customer for future obligations to transfer products or services. Our deferred revenues, excluding the impact of liabilities held for sale, primarily relate to cloud services and customer support agreements which have been paid for by customers prior to the performance of those services. The amount of revenue that was recognized during the six months ended December 31, 2023 that was included in the deferred revenue balances at June 30, 2023 was $1,268 million (six months ended December 31, 2022—$658 million).

Incremental Costs of Obtaining a Contract with a Customer

Incremental costs of obtaining a contract include only those costs that we incur to obtain a contract that we would not have incurred if the contract had not been obtained, such as sales commissions. The following table summarizes the changes in total capitalized costs to obtain a contract, since June 30, 2023:

Capitalized costs to obtain a contract as of June 30, 2023	$	97,207
New capitalized costs incurred	26,522
Amortization of capitalized costs	(19,507)
Impact of foreign exchange rate changes	400
Reclassification to Assets held for sale (1)	(2,588)
Capitalized costs to obtain a contract as of December 31, 2023	$	102,034

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(1)Capitalized costs to obtain a contract of $2.6 million have been reclassified to Assets held for sale related to the proposed divestiture of our AMC business. See Note 19 “Acquisitions and Divestitures.”

During the three and six months ended December 31, 2023 and 2022, respectively, there was no significant impairment loss recognized related to capitalized costs to obtain a contract. Refer to Note 9 “Prepaid Expenses and Other Assets” for additional information on incremental costs of obtaining a contract.

Transaction Price Allocated to the Remaining Performance Obligations

As of December 31, 2023, approximately $2.5 billion of revenue is expected to be recognized from remaining performance obligations on existing contracts, excluding performance obligations related to the proposed divestiture of our AMC business which are reported within Liabilities held for sale. We expect to recognize approximately 46% of this amount over the next 12 months and the remaining balance substantially over the next three years thereafter. As of December 31, 2023, approximately $128.9 million of revenue is expected to be recognized from remaining performance obligations on existing contracts relates to the proposed divestiture of our AMC business and we expect to recognize approximately 49% of this amount over the next 12 months. We apply the practical expedient and do not disclose performance obligations that have original expected durations of one year or less.