CONCENTRATIONS AND UNCERTAINTIES

12 Months Ended

Aug. 31, 2022

Risks and Uncertainties [Abstract]

CONCENTRATIONS AND UNCERTAINTIES

CONCENTRATIONS AND UNCERTAINTIES

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, trade accounts receivable, and short-term investments. The Company holds cash and cash equivalents at banks located in California, with balances that often exceed FDIC insured limits. In addition, we hold cash at a bank in France that is not FDIC-insured. Historically, the Company has not experienced any losses in such accounts. While the Company may be exposed to credit losses due to the nonperformance of its counterparties, the Company does not expect the settlement of these transactions to have a material effect on its results of operations, cash flows, or financial condition. The Company maintains cash at financial institutions that may, at times, exceed federally insured limits.

Revenue concentration shows that international sales accounted for 30%, 31%, and 29% of revenue for the years ended August 31, 2022, 2021, and 2020, respectively. Our three largest customers in terms of revenue accounted for 5%, 3%, and 3% of revenue for fiscal year 2022. Our three largest customers in terms of revenue accounted for 11%, 4%, and 3% of revenue for fiscal year 2021. Our three largest customers in terms of revenue accounted for 9%, 7%, and 7% of revenue for fiscal year 2020.

Accounts receivable concentrations show that our three largest customers in terms of accounts receivable each comprised between 4% and 8% of accounts receivable as of August 31, 2022, respectively; our two largest customers in terms of accounts receivable comprised 5% and 16% of accounts receivable as of August 31, 2021, respectively.

We operate in the biosimulation market, which is highly competitive and changes rapidly. Our operating results could be significantly affected by our ability to develop new products and find new distribution channels for new and existing products.