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Revenue from Contracts with Customers
 9 Months Ended
Sep. 30, 2023
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
Revenue by major products and services
The following tables present the Company’s revenues disaggregated by major products and services, geographical region and timing of revenue recognition:
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
(In thousands)
Subscription$26,185 $22,262 $79,126 $65,360 
Maintenance and support12,271 12,851 35,035 36,975 
Professional services and other (1)1,543 2,220 4,666 6,101 
Hardware products18,839 19,814 53,351 53,948 
Total Revenue$58,838 $57,147 $172,178 $162,384 
(1) Professional services and other includes perpetual software licenses revenue, which was less than 2% of total revenue for the three and nine months ended September 30, 2023, respectively, and less than 3% of total revenue for the three and nine months ended September 30, 2022, respectively.
Revenue by location of customer for the Three and Nine Months Ended September 30, 2023 and 2022
We classify our sales by customer location in three geographic regions: 1) EMEA, which includes Europe, Middle East and Africa; 2) the Americas, which includes North, Central, and South America; and 3) Asia Pacific (APAC), which includes Australia, New Zealand, and India. The breakdown of revenue in each of our major geographic areas was as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
(In thousands, except percentages)
Revenue
EMEA$26,233 $25,999 $80,592 $74,396 
Americas19,999 20,394 58,828 56,972 
APAC12,606 10,754 32,758 31,016 
Total revenue$58,838 $57,147 $172,178 $162,384 
% of Total Revenue
EMEA45 %45 %47 %46 %
Americas34 %36 %34 %35 %
APAC21 %19 %19 %19 %
Timing of revenue recognition
Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)2023202220232022
Products and Licenses transferred at a point in time$31,732 $31,280 $95,461 $89,496 
Services transferred over time27,106 25,867 76,717 72,888 
Total Revenue$58,838 $57,147 $172,178 $162,384 
Contract balances
The following table provides information about receivables, contract assets and contract liabilities from contracts with customers as of September 30, 2023 and December 31, 2022:
September 30,December 31,
(In thousands)20232022
Receivables, inclusive of trade and unbilled$38,667 $65,132 
Contract Assets (current and non-current)$5,096 $4,642 
Contract Liabilities (Deferred Revenue current and non-current)$55,329 $70,906 
Contract assets relate primarily to multi-year term license arrangements and the remaining contractual billings. These contract assets are transferred to receivables when the right to bill occurs over a 2- to 5-year period. The contract liabilities primarily relate to the advance consideration received from customers for subscription and maintenance services. Revenue is recognized for these services over time.
As a practical expedient, the Company does not adjust the promised amount of consideration for the effects of a significant financing component when it is expected, at contract inception, that the period between the Company's transfer of a promised product or service to a customer and when the customer pays for that product or service will be one year or less. Extended payment terms are not typically included in contracts with customers.
Revenue recognized during the nine months ended September 30, 2023 included $52.6 million that was included on the December 31, 2022 consolidated balance sheet in contract liabilities. Deferred revenue decreased in the same period due to timing of annual renewals.
Transaction price allocated to the remaining performance obligations
Remaining performance obligations represent the revenue that is expected to be recognized in future periods related to performance obligations that are unsatisfied, or partially unsatisfied, as of the end of the period. The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2023:
(In thousands)202320242025Beyond 2025Total
Future revenue related to current unsatisfied performance obligations$12,040 $30,733 $16,271 $10,340 $69,384 
The Company applies practical expedients and does not disclose information about remaining performance obligations (a) that have original expected durations of one year or less, or (b) where revenue is recognized as invoiced.
Costs of obtaining a contract
The Company incurs incremental costs related to commissions, which can be directly tied to obtaining a contract. The Company capitalizes commissions associated with certain new contracts and amortizes the costs over a period of up to seven years, which is the determined benefit period based on the transfer of goods or services. The Company determined the period of benefit by taking into consideration the customer contracts, its technology and other factors, including customer attrition. Commissions are earned upon invoicing to the customer. For contracts with multiple year payment terms, because the commissions that are payable after year 1 are payable based on continued employment, they are expensed when incurred. Commissions and amortization expense are included in “Sales and Marketing” expense in the condensed consolidated statements of operations.
Applying the practical expedient, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period for the assets that the Company otherwise would have recognized is one year or less. These costs are included in “Sales and Marketing” expense in the condensed consolidated statements of operations.
The following tables provide information related to the capitalized costs and amortization recognized in the current and prior period:
(In thousands)September 30, 2023December 31, 2022
Capitalized costs to obtain contracts, current$3,284 $2,929 
Capitalized costs to obtain contracts, non-current$10,322 $10,571 
Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)2023202220232022
Amortization of capitalized costs to obtain contracts$801 $641 $2,286 $1,731 
Impairments of capitalized costs to obtain contracts$— $— $— $—