Revenue Recognition

6 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenue Recognition

(15) Revenue Recognition

The following table disaggregates the Company’s revenue by geography which provides information as to the major source of revenue. North America includes United States and Canada and International aggregates international revenues excluding Canada. The majority of the Company's North America revenue is generated in the United States (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
Primary Geographic Markets	2023		2022		2023		2022
North America	$	83,155	$	76,519	$	165,222	$	151,499
International		27,414		26,467		53,615		51,862
Total	$	110,569	$	102,986	$	218,837	$	203,361

The following table presents the Company’s revenues disaggregated by revenue source (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Subscription services	$	101,837	$	94,558	$	200,622	$	186,413
Professional services		6,251		6,024		12,180		12,565
Software licenses and other		2,481		2,404		6,035		4,383
Total	$	110,569	$	102,986	$	218,837	$	203,361

Contract Assets

Contract assets arise when the Company has earned revenue on a contract with a customer prior to billing. Any contract assets that may arise are recorded in other assets on the condensed consolidated balance sheets net of an allowance for credit losses.

Contract Liabilities

The Company’s contract liabilities consist of advance payments and deferred revenue. The Company’s contract liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. The Company classifies advance payments and deferred revenue as current or noncurrent based on the timing of when it expects to recognize revenue. Generally, all contract liabilities are expected to be recognized within one year and are included in deferred revenue on the condensed consolidated balance sheets. The noncurrent portion of deferred revenue is included and separately disclosed on the condensed consolidated balance sheets.

Deferred Costs

Current deferred costs, which primarily consist of deferred sales commissions, were $17.2 million and $16.2 million as of June 30, 2023 and December 31, 2022, respectively. Noncurrent deferred costs, which primarily consist of deferred sales commissions, were $24.2 million and $21.4 million as of June 30, 2023 and December 31, 2022, respectively. During the three months ended June 30, 2023 and 2022, amortization expense for the deferred costs was $5.0 million and $4.7 million, respectively. During the six months ended June 30, 2023 and 2022, amortization expense for the deferred costs was $9.5 million and $8.7 million, respectively. There was no impairment loss in relation to the costs capitalized for the six months ended June 30, 2023 and the year ended December 31, 2022, respectively.

Deferred Revenue

During the three months ended June 30, 2023 and 2022, $93.3 million and $86.9 million, respectively, of subscription services, license and other revenue was recognized and was included in the deferred revenue balances at the beginning of the respective period. During the six months ended June 30, 2023 and 2022, $159.0 million and $145.4 million, respectively, of subscription services, license and other revenue was recognized and was included in the deferred revenue balances at the beginning of the respective period.

During the three months ended June 30, 2023 and 2022, $1.7 million and $2.6 million, respectively, of professional services revenue was recognized and was included in the deferred revenue balances at the beginning of the respective period. During the six months ended June 30, 2023 and 2022, $3.9 million and $5.8 million, respectively, of professional services revenue was recognized and was included in the deferred revenue balances at the beginning of the respective period.

Remaining Performance Obligations

As of June 30, 2023, approximately $479.5 million of revenue is expected to be recognized from remaining performance obligations for subscription and other contracts. The Company expects to recognize revenue on approximately $290.1 million of these remaining performance obligations over the next 12 months, with the balance recognized thereafter.

As of June 30, 2023, approximately $9.8 million of revenue is expected to be recognized from remaining performance obligations for professional services contracts. The Company expects to recognize revenue on approximately $9.5 million of these remaining performance obligations over the next 12 months, with the balance recognized thereafter.