Revenue Recognition

9 Months Ended

Apr. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Note 3—Revenue Recognition

The Company earns revenue from contracts with customers, primarily through the provision of retail telecommunications and payment offerings as well as wholesale international voice and SMS termination. BOSS Money, NRS, and net2phone are technology-driven, synergistic businesses that leverage the Company’s core assets. BOSS Money’s and NRS’ revenues are primarily recognized at a point in time, and net2phone’s revenue is mainly recognized over time. Traditional Communications are mostly minute-based, paid-voice communications services, and revenue is primarily recognized at a point in time. The Company’s most significant revenue streams are from IDT Digital Payments, BOSS Revolution Calling, and IDT Global. IDT Digital Payments and BOSS Revolution Calling are sold direct-to-consumer and through distributors and retailers.

Disaggregated Revenues

The following table shows the Company’s revenues disaggregated by business segment and service offered to customers:

	Three Months Ended April 30,				Nine Months Ended April 30,
	2024		2023		2024		2023
	(in thousands)
National Retail Solutions	$	25,712	$	18,073	$	74,930	$	57,208
BOSS Money		27,593		19,441		76,871		54,644
Other		3,933		2,346		9,205		7,351
Total Fintech		31,526		21,787		86,076		61,995
net2phone		20,677		18,392		60,957		53,136
IDT Digital Payments		101,559		101,030		301,165		316,207
BOSS Revolution Calling		63,245		77,646		201,169		246,729
IDT Global		50,067		54,473		150,843		174,715
Other		6,857		7,894		21,806		25,057
Total Traditional Communications		221,728		241,043		674,983		762,708
Total	$	299,643	$	299,295	$	896,946	$	935,047

The following table shows the Company’s revenues disaggregated by geographic region, which is determined based on selling location:

(in thousands)	National Retail Solutions		Fintech		net2phone		Traditional Communications		Total
Three Months Ended April 30, 2024
United States	$	25,712	$	30,469	$	11,330	$	166,093	$	233,604
Outside the United States:
United Kingdom		—		—		—		48,441		48,441
Other		—		1,057		9,347		7,194		17,598
Total outside the United States		—		1,057		9,347		55,635		66,039
Total	$	25,712	$	31,526	$	20,677	$	221,728	$	299,643

(in thousands)	National Retail Solutions		Fintech		net2phone		Traditional Communications		Total
Three Months Ended April 30, 2023
United States	$	18,073	$	21,124	$	9,571	$	166,854	$	215,622
Outside the United States:
United Kingdom		—		—		—		64,415		64,415
Other		—		663		8,821		9,774		19,258
Total outside the United States		—		663		8,821		74,189		83,673
Total	$	18,073	$	21,787	$	18,392	$	241,043	$	299,295

(in thousands)	National Retail Solutions		Fintech		net2phone		Traditional Communications		Total
Nine Months Ended April 30, 2024
United States	$	74,930	$	83,204	$	32,718	$	492,935	$	683,787
Outside the United States:
United Kingdom		—		—		—		157,673		157,673
Other		—		2,872		28,239		24,375		55,486
Total outside the United States		—		2,872		28,239		182,048		213,159
Total	$	74,930	$	86,076	$	60,957	$	674,983	$	896,946

(in thousands)	National Retail Solutions		Fintech		net2phone		Traditional Communications		Total
Nine Months Ended April 30, 2023
United States	$	57,208	$	59,991	$	27,888	$	528,116	$	673,203
Outside the United States:
United Kingdom		—		—		—		202,355		202,355
Other		—		2,004		25,248		32,237		59,489
Total outside the United States		—		2,004		25,248		234,592		261,844
Total	$	57,208	$	61,995	$	53,136	$	762,708	$	935,047

Remaining Performance Obligations

The following table includes revenue by business segment expected to be recognized in the future from performance obligations that were unsatisfied or partially unsatisfied as of April 30, 2024. The table excludes contracts that had an original expected duration of one year or less.

(in thousands)	National Retail Solutions		net2phone		Total
Twelve-month period ending April 30:
2025	$	6,305	$	38,388	$	44,693
2026		5,262		18,749		24,011
Thereafter		5,128		6,319		11,447
Total	$	16,695	$	63,456	$	80,151

Accounts Receivable and Contract Balances

The timing of revenue recognition may differ from the time of billing to the Company’s customers. Trade accounts receivable in the Company’s consolidated balance sheets represent unconditional rights to consideration. The Company would record a contract asset when revenue is recognized in advance of its right to bill and receive consideration. The Company has not currently identified any contract assets.

Contract liabilities arise when the Company receives consideration or bills its customers prior to providing the goods or services promised in the contract. The Company’s contract liability balance is primarily payments received for prepaid BOSS Revolution Calling. Contract liabilities are recognized as revenue when services are provided to the customer. The contract liability balances are presented in the Company’s consolidated balance sheets as “Deferred revenue”.

The following table presents information about the Company’s contract liability balance:

	Three Months Ended April 30,				Nine Months Ended April 30,
	2024		2023		2024		2023
	(in thousands)
Revenue recognized in the period from amounts included in the contract liability balance at the beginning of the period	$	15,231	$	16,772	$	20,477	$	21,890

Deferred Customer Contract Acquisition and Fulfillment Costs

The Company recognizes as an asset its incremental costs of obtaining a contract with a customer that it expects to recover. The Company’s incremental costs of obtaining a contract with a customer are sales commissions paid to employees and third parties on sales to end users. If the amortization period were one year or less for the asset that would be recognized from deferring these costs, the Company applies the practical expedient whereby the Company charges these costs to expense when incurred. For net2phone sales, the Company defers these costs and amortizes them over the expected customer relationship period when it is expected to exceed one year.

The Company’s costs to fulfill its contracts do not meet the criteria to be recognized as an asset, therefore these costs are charged to expense as incurred.

The Company’s deferred customer contract acquisition costs were as follows:

	April 30, 2024		July 31, 2023
	(in thousands)
Deferred customer contract acquisition costs included in “Other current assets”	$	4,145	$	4,460
Deferred customer contract acquisition costs included in “Other assets”		3,957		3,734
Total	$	8,102	$	8,194

The Company’s amortization of deferred customer contract acquisition costs during the periods were as follows:

	Three Months Ended April 30,				Nine Months Ended April 30,
	2024		2023		2024		2023
	(in thousands)
Amortization of deferred customer contract acquisition costs	$	1,167	$	1,226	$	3,576	$	3,631