Revenue

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Revenue Recognition

Laureate's revenues primarily consist of tuition and educational service revenues. We also generate other revenues from student fees, dormitory/residency fees and other education-related activities. These other revenues are less material to our overall financial results and have a tendency to trend with tuition revenues. Revenues are recognized when control of the promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. These revenues are recognized net of scholarships and other discounts, refunds, waivers and the fair value of any guarantees made by Laureate related to student financing programs. Laureate's institutions have various billing and academic cycles.

We determine revenue recognition through the five-step model prescribed by ASC Topic 606, Revenue from Contracts with Customers, as follows:

•Identification of the contract, or contracts, with a customer;

•Identification of the performance obligations in the contract;

•Determination of the transaction price;

•Allocation of the transaction price to the performance obligations in the contract; and

•Recognition of revenue when, or as, we satisfy a performance obligation.

We assess collectibility on a portfolio basis prior to recording revenue. Generally, students cannot re-enroll for the next academic session without satisfactory resolution of any past-due amounts. If a student withdraws from an institution, Laureate's obligation to issue a refund depends on the refund policy at that institution and the timing of the student's withdrawal. Generally, our refund obligations are reduced over the course of the academic term. We record refunds as a reduction of deferred revenue as applicable.

The following table shows the components of Revenues by reportable segment and as a percentage of total net revenue for the three months ended June 30, 2020 and 2019:

	Brazil		Mexico		Andean		Rest of World		Online & Partnerships		Corporate(1)		Total
2020
Tuition and educational services	$	212,674	$	136,408	$	384,171	$	69,657	$	161,023	$	—	$	963,933	122	%
Other	511		12,137		13,520		1,356		13,709		984		42,217		5	%
Gross revenue	213,185		148,545		397,691		71,013		174,732		984		1,006,150		127	%
Less: Discounts / waivers / scholarships	(94,666)		(33,681)		(51,824)		(8,454)		(25,847)		—		(214,472)		(27)	%
Total	$	118,519	$	114,864	$	345,867	$	62,559	$	148,885	$	984	$	791,678	100	%
2019
Tuition and educational services	$	333,758	$	178,088	$	448,971	$	54,277	$	177,590	$	—	$	1,192,684	120	%
Other	2,442		21,166		22,764		1,997		13,320		(1,053)		60,636		6	%
Gross revenue	336,200		199,254		471,735		56,274		190,910		(1,053)		1,253,320		126	%
Less: Discounts / waivers / scholarships	(139,094)		(36,799)		(48,741)		(5,088)		(31,195)		—		(260,917)		(26)	%
Total	$	197,106	$	162,455	$	422,994	$	51,186	$	159,715	$	(1,053)	$	992,403	100	%

The following table shows the components of Revenues by reportable segment and as a percentage of total net revenue for the six months ended June 30, 2020 and 2019:

	Brazil		Mexico		Andean		Rest of World		Online & Partnerships		Corporate(1)		Total
2020
Tuition and educational services	$	367,818	$	300,573	$	473,431	$	116,237	$	335,381	$	—	$	1,593,440	121	%
Other	2,494		39,354		25,213		3,126		25,495		2,064		97,746		7	%
Gross revenue	370,312		339,927		498,644		119,363		360,876		2,064		1,691,186		128	%
Less: Discounts / waivers / scholarships	(168,112)		(70,856)		(63,269)		(13,228)		(55,486)		—		(370,951)		(28)	%
Total	$	202,200	$	269,071	$	435,375	$	106,135	$	305,390	$	2,064	$	1,320,235	100	%
2019
Tuition and educational services	$	535,013	$	342,890	$	586,374	$	88,866	$	358,640	$	—	$	1,911,783	120	%
Other	4,367		47,662		38,610		3,941		25,327		(562)		119,345		7	%
Gross revenue	539,380		390,552		624,984		92,807		383,967		(562)		2,031,128		127	%
Less: Discounts / waivers / scholarships	(232,306)		(71,633)		(63,047)		(8,189)		(62,478)		—		(437,653)		(27)	%
Total	$	307,074	$	318,919	$	561,937	$	84,618	$	321,489	$	(562)	$	1,593,475	100	%

⁽¹⁾ Includes the elimination of intersegment revenues.

Contract Balances

The timing of billings, cash collections and revenue recognition results in accounts receivable (contract assets) and deferred revenue and student deposits (contract liabilities) on the Consolidated Balance Sheets. We have various billing and academic cycles and recognize student receivables when an academic session begins, although students generally enroll in courses prior to the start of the academic session. Receivables are recognized only to the extent that it is probable that we will collect substantially all of the consideration to which we are entitled in exchange for the goods and services that will be transferred to the student. We receive advance payments or deposits from our students before revenue is recognized, which are recorded as contract liabilities in deferred revenue and student deposits. Payment terms vary by university with some universities requiring payment in advance of the academic session and other universities allowing students to pay in installments over the term of the academic session.

All of our contract assets are considered accounts receivable and are included within the Accounts and notes receivable balance in the accompanying Consolidated Balance Sheets. Total accounts receivable from our contracts with students were $469,294 and $432,910 as of June 30, 2020 and December 31, 2019, respectively. The increase in the contract assets balance at June 30, 2020 compared to December 31, 2019 was primarily driven by our enrollment cycles. The first and third calendar quarters generally coincide with the primary and secondary intakes for our larger institutions. All contract asset amounts are classified as current.

Contract liabilities in the amount of $340,343 and $216,816 were included within the Deferred revenue and student deposits balance in the current liabilities section of the accompanying Consolidated Balance Sheets as of June 30, 2020 and December 31, 2019, respectively. The increase in the contract liability balance during the period ended June 30, 2020 was the result of semester billings and cash payments received in advance of satisfying performance obligations, offset by revenue recognized during that period. Revenue recognized for the six months ended June 30, 2020 that was included in the contract liability balance at the beginning of the year was approximately $168,700.