Revenue Recognition

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

Substantially all of our revenues are considered to be revenues from contracts with customers. The related accounts receivable balances are recorded in our balance sheets as customer accounts receivable. We do not have obligations for warranties, returns or refunds to customers, other than rebates, which are settled each period and therefore do not result in variable consideration. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods, and we do not have any transaction price allocated to unsatisfied performance obligations other than in our deferred revenue. Deferred revenue represents our contract liabilities related to our annual, original and other listings revenues as well as certain data services, clearing services and other revenues. See Note 7 for our discussion of deferred revenue balances, activity, and expected timing of recognition. We have elected not to provide disclosures about transaction price allocated to unsatisfied performance obligations if contract durations are less than one year, or if we are not required to estimate the transaction price. For all of our contracts with customers, except for listings and certain data and clearing services, our performance obligations are short term in nature and there is no significant variable consideration. In addition, we have elected the practical expedient of excluding sales taxes from transaction prices. We have assessed the costs incurred to obtain or fulfill a contract with a customer and determined them to be immaterial.

Certain judgments and estimates are used in the identification and timing of satisfaction of performance obligations and the related allocation of transaction price. We believe that these represent a faithful depiction of the transfer of services to our customers. Refer to Note 5 to our consolidated financial statements included in our 2019 Form 10-K where our primary revenue contract classifications are described in detail.

The following table depicts the disaggregation of our revenue according to business line and segment (in millions). Amounts here have been aggregated as they follow consistent revenue recognition patterns, and are consistent with the segment information in Note 15:

	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Six Months Ended June 30, 2020:
Transaction and clearing, net	$	2,571	$	—	$	2,571
Data services	—		1,138		1,138
Listings	—		223		223
Other revenues	149		—		149
Total revenues	2,720		1,361		4,081
Transaction-based expenses	1,127		—		1,127
Total revenues, less transaction-based expenses	$	1,593	$	1,361	$	2,954
Timing of Revenue Recognition
Services transferred at a point in time	$	1,387	$	—	$	1,387
Services transferred over time	206		1,361		1,567
Total revenues, less transaction-based expenses	$	1,593	$	1,361	$	2,954

	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Six Months Ended June 30, 2019:
Transaction and clearing, net	$	1,769	$	—	$	1,769
Data services	—		1,099		1,099
Listings	—		222		222
Other revenues	127		—		127
Total revenues	1,896		1,321		3,217
Transaction-based expenses	649		—		649
Total revenues, less transaction-based expenses	$	1,247	$	1,321	$	2,568
Timing of Revenue Recognition
Services transferred at a point in time	$	1,075	$	—	$	1,075
Services transferred over time	172		1,321		1,493
Total revenues, less transaction-based expenses	$	1,247	$	1,321	$	2,568

	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Three Months Ended June 30, 2020:
Transaction and clearing, net	$	1,207	$	—	$	1,207
Data services	—		574		574
Listings	—		111		111
Other revenues	74		—		74
Total revenues	1,281		685		1,966
Transaction-based expenses	571		—		571
Total revenues, less transaction-based expenses	$	710	$	685	$	1,395
Timing of Revenue Recognition
Services transferred at a point in time	$	621	$	—	$	621
Services transferred over time	89		685		774
Total revenues, less transaction-based expenses	$	710	$	685	$	1,395

	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Three Months Ended June 30, 2019:
Transaction and clearing, net	$	907	$	—	$	907
Data services	—		553		553
Listings	—		111		111
Other revenues	63		—		63
Total revenues	970		664		1,634
Transaction-based expenses	336		—		336
Total revenues, less transaction-based expenses	$	634	$	664	$	1,298
Timing of Revenue Recognition
Services transferred at a point in time	$	547	$	—	$	547
Services transferred over time	87		664		751
Total revenues, less transaction-based expenses	$	634	$	664	$	1,298

The Trading and Clearing segment revenues above include $153 million and $122 million for the six months ended June 30, 2020 and 2019, respectively, and $64 million and $62 million for the three months ended June 30, 2020 and 2019, respectively, for services transferred over time related to risk management of open interest performance obligations. A majority of these performance obligations are performed over a short period of time of one month or less.

Beginning in the second quarter of 2019, we have reflected amounts owed under certain third-party revenue share arrangements as technology and communication operating expenses rather than as had been previously recorded net within transaction and clearing revenues. These are included within our Trading and Clearing segment.

Deferred Revenue

Our contract liabilities, or deferred revenue, represent consideration received that is yet to be recognized as revenue. Total deferred revenue was $465 million as of June 30, 2020, including $383 million in current deferred revenue and $82 million in other non-current liabilities. The changes in our deferred revenue during the six months ended June 30, 2020 are as follows (in millions):

	Annual Listings Revenues		Original Listings Revenues		Other Listings Revenues		Data Services and Other Revenues		Total
Deferred revenue balance at December 31, 2019	$	—	$	19	$	94	$	88	$	201
Additions	383		6		25		284		698
Amortization	(191)		(9)		(22)		(212)		(434)
Deferred revenue balance at June 30, 2020	$	192	$	16	$	97	$	160	$	465

The changes in our deferred revenue during the six months ended June 30, 2019 are as follows (in millions):

	Annual Listings Revenues		Original Listings Revenues		Other Listings Revenues		Data Services and Other Revenues		Total
Deferred revenue balance at December 31, 2018	$	—	$	25	$	100	$	92	$	217
Additions	382		3		24		229		638
Amortization	(191)		(11)		(20)		(186)		(408)
Deferred revenue balance at June 30, 2019	$	191	$	17	$	104	$	135	$	447

Included in the amortization recognized during the six months ended June 30, 2020 is $72 million related to the deferred revenue balance as of January 1, 2020. Included in the amortization recognized for the six months ended June 30, 2019 is $61 million related to the deferred revenue balance as of January 1, 2019. As of June 30, 2020, the remaining deferred revenue balance for original listings revenue, other listings revenue and data services and other revenues will be recognized over the period of time we satisfy our performance obligations as described in Note 5.