Revenue from Contracts with Customers

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

2.	Revenue from Contracts with Customers

The Company recognizes revenue on

time-and-material

contracts as services are performed and expenses are incurred.

Time-and-material

contracts typically bill at an agreed-upon hourly rate, plus

out-of-pocket

expense reimbursement.

Out-of-pocket

expense reimbursement amounts vary by assignment, but on average represent less than 2% of total revenues. Revenue is earned on a per transaction or labor hour basis, as that amount directly corresponds to the value of the Company’s performance. Revenue recognition is negatively impacted by holidays and consultant vacation and sick days.

In certain situations related to client direct hire assignments, where the Company’s fee is contingent upon the hired resources continued employment with the client, revenue is not fully recognized until such employment conditions are satisfied.

The Company recognizes revenue on fixed price contracts as services are rendered and uses a cost-based input method to measure progress. Determining a measure of progress requires management to make judgments that affect the timing of revenue recognized. Under the cost-based input method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. The Company has determined that the cost-based input method provides a faithful depiction of the transfer of goods or services to the customer. Estimated losses are recognized immediately in the period in which current estimates indicate a loss. We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which may be refundable.

We do not sell, lease or otherwise market computer software or hardware, and essentially 100% of our revenue is derived from the sale of data and analytics, IT staffing and digital transformation services. We expense sales commissions in the same period in which revenues are realized. These costs are recorded within sales and marketing expenses.

Our data and analytics services segment provides specialized capabilities in delivering data management and analytics services to customers globally. This business offers project-based consulting services in the areas of Master Data Management, Enterprise Data Integration, Data and Analytics and Digital Transformation, which can be delivered using onsite and offshore resources.

Our IT staffing business combines technical expertise with business process experience to deliver a broad range of services in digital and mainstream technologies. Our digital technology stack includes data management and analytics, cloud, mobility, social and automation. Our mainstream technologies include business intelligence / data warehousing; web services; enterprise resource planning & customer resource management; and

e-Business

solutions. We work with businesses and institutions with significant

IT-spend

and recurring staffing needs. We also support smaller organizations with their “project focused” temporary IT staffing requirements.

The following table depicts the disaggregation of our revenues by contract type and operating segment:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
	(Amounts in millions)				(Amounts in millions)
Data and Analytics Services Segment
Time-and-material Contracts	$	5,415	$	3,772	$	14,178	$	14,185
Fixed-price Contracts		1,665		2,015		5,324		4,257

Subtotal Data and Analytics Services	$	7,080	$	5,787	$	19,502	$	18,442

IT Staffing Services Segment
Time-and-material Contracts	$	42,463	$	38,505	$	123,712	$	114,077
Fixed-price Contracts		—		—		—		—

Subtotal IT Staffing Services	$	42,463	$	38,505	$	123,712	$	114,077

Total Revenues	$	49,543	$	44,292	$	143,214	$	132,519

For the three months ended September 30, 2019, the Company had one client that exceeded 10% of total revenue (CGI = 11.3%). For the nine months ended September 30, 2019, the Company had the same one client that exceeded 10% of total revenue (CGI = 11.3%). For the three and nine months ended September 30, 2018, the Company had the same one client that exceeded 10% of total revenue in both periods (CGI = 13.5% and 12.9%), respectively.

The Company’s top ten clients represented approximately 45% and 48% of total revenues for the three months ended September 30, 2019 and 2018, respectively. For the nine months ended September 30, 2019 and 2018, the Company’s top ten clients represented approximately 45% and 48% of total revenues, respectively.

The following table presents our revenue from external customers disaggregated by geography, based on the work location of our customers:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
	(Amounts in thousands)				(Amounts in thousands)
United States	$	48,421	$	43,222	$	139,739	$	128,775
Canada		737		650		2,180		2,573
India and Other		385		420		1,295		1,171

Total revenues	$	49,543	$	44,292	$	143,214	$	132,519