Quarterly report pursuant to Section 13 or 15(d)

Note 13 - Revenue

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Note 13 - Revenue
6 Months Ended
Jul. 31, 2023
Notes to Financial Statements  
Revenue from Contract with Customer [Text Block]

(13)    Revenue

 

Revenue Components and Performance Obligations

 

Subscription services

 

The Company offers subscriptions that provide customers access to a broad-based spectrum of learning options including access to cloud-based learning content and individualized coaching. The Company’s cloud-based subscription solutions normally do not provide customers with the right to take possession of the software supporting the platform or to download course content without continuing to incur fees for hosting services and, as a result, are accounted for as service arrangements. Access to the platform and course content represents a series of distinct services as the Company continually provides access to, and fulfills its obligation to, the end customer over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the fixed consideration related to subscription revenue is usually recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. The Company’s subscription contracts typically vary from one year to three years. The Company’s cloud-based solutions arrangements are mostly non-cancellable, non-refundable, and are invoiced in advance of the subscription services being provided.

 

Virtual, on-demand and classroom

 

The Company’s virtual, on-demand and classroom training provides customers with technical training. Revenue is recognized in the period in which the services are performed. Billing is in advance of the services being provided or immediately after the services have been provided.

 

Professional services

 

The Company also sells professional services related to its cloud solutions which are typically considered distinct performance obligations and are recognized over time as services are performed. For fixed-price contracts, revenue is recognized based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided (proportional performance method). These services usually consist of implementation, integration, and general consulting. Mostly, the Company’s professional service engagements are short in duration. Billing is commonly in advance of the services being provided.

 

Disaggregated Revenue and Geography Information

 

The following is a summary of revenues by type for the three and six months ended July 31, 2023 and July 31, 2022 (in thousands):

 

   

Three Months Ended July 31,

   

Six Months Ended July 31,

 
   

2023

   

2022

   

2023

   

2022

 

SaaS and subscription services

  $ 98,032     $ 94,247     $ 191,851     $ 179,316  

Virtual, on-demand and classroom

    37,999       41,821       74,980       86,874  

Professional services

    5,156       4,506       9,910       9,223  

Total net revenues

  $ 141,187     $ 140,574     $ 276,741     $ 275,413  

  

   

Three Months Ended July 31,

   

Six Months Ended July 31,

 
   

2023

   

2022

   

2023

   

2022

 

Revenue:

                               

United States

  $ 92,936     $ 92,603     $ 182,023     $ 176,039  

Europe, Middle East and Africa

    35,741       35,775       70,276       74,416  

Other Americas

    7,331       7,419       14,327       15,976  

Asia-Pacific

    5,179       4,777       10,115       8,982  

Total net revenues

  $ 141,187     $ 140,574     $ 276,741     $ 275,413  

 

Other than the United States, no single country accounted for more than 10% of revenue for all periods presented.

 

Deferred Revenue

 

Deferred revenue activity for the six months ended July 31, 2023 was as follows (in thousands):

 

Deferred revenue at January 31, 2023

  $ 282,454  

Billings deferred

    220,870  

Recognition of prior deferred revenue

    (276,741 )

Deferred revenue at July 31, 2023

  $ 226,583  

 

Deferred revenue performance obligations relate predominantly to time-based SaaS and subscription services that are billed in advance of services being rendered.

 

Deferred Contract Acquisition Costs

 

Deferred contract acquisition cost activity for the six months ended July 31, 2023 was as follows (in thousands):

 

Deferred contract acquisition costs at January 31, 2023

  $ 24,594  

Contract acquisition costs

    14,166  

Recognition of contract acquisition costs

    (9,451 )

Deferred contract acquisition costs at July 31, 2023

  $ 29,309