Revenue from Contracts with Clients and Customers

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Clients and Customers

Revenue from Contracts with Clients and Customers

The following table presents our revenues, excluding sales and usage-based taxes, disaggregated by revenue source (in thousands):

	Three Months Ended March 31, 2020						Three Months Ended March 31, 2019
	PFS Operations		LiveArea Professional Services		Total		PFS Operations		LiveArea Professional Services		Total
Revenues:
Service fee revenue	$	33,431	$	20,867	$	54,298	$	33,055	$	18,384	$	51,439
Product revenue, net	7,533		—		7,533		7,499		—		7,499
Pass-through revenue	13,956		912		14,868		12,876		335		13,211
Total revenues	$	54,920	$	21,779	$	76,699	$	53,430	$	18,719	$	72,149

The following table presents our revenues, excluding sales and usage-based taxes, disaggregated by timing of revenue recognition (in thousands):

	Three Months Ended March 31, 2020						Three Months Ended March 31, 2019
	PFS Operations		LiveArea Professional Services		Total		PFS Operations		LiveArea Professional Services		Total
Revenues:
Over time	$	47,387	$	21,779	$	69,166	$	45,931	$	18,719	$	64,650
Point-in-time	7,533		—		7,533		7,499		—		7,499
Total revenues	$	54,920	$	21,779	$	76,699	$	53,430	$	18,719	$	72,149

The following table presents our revenues, excluding sales and usage-based taxes, disaggregated by region (in thousands):

	Three Months Ended March 31, 2020						Three Months Ended March 31, 2019
	PFS Operations		LiveArea Professional Services		Total		PFS Operations		LiveArea Professional Services		Total
Revenues by region:
North America	$	45,098	$	19,197	$	64,295	$	43,602	$	16,718	$	60,320
Europe	9,822		2,582		12,404		9,828		2,001		11,829
Total revenues	$	54,920	$	21,779	$	76,699	$	53,430	$	18,719	$	72,149

Contract Assets and Contract Liabilities

Changes in costs to fulfill contract assets during the period decreased$0.6 million from December 31, 2019 to March 31, 2020, primarily due to a decrease of approximately $1.7 million for amortization and recognition of costs, offset by approximately $1.1 million from new projects in the three months ended March 31, 2020. Costs to fulfill contract assets relate to deferred costs, which are included within other current assets and/or other assets, and software development costs, which are included within property and equipment, in our condensed consolidated balance sheets.

Changes in contract liabilities during the period decreased$2.2 million from December 31, 2019 to March 31, 2020, primarily due to a decrease of approximately $4.4 million for amortization and recognition of revenue, offset by approximately $2.2 million from new projects in the three months ended March 31, 2020.  Contract losses recognized for the three months ended March 31, 2020 were not material. Accrued contract liabilities below are included within accrued expenses in our condensed consolidated balance sheets.

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables, and customer advances and deposits (contract liabilities) on the condensed consolidated balance sheets. Changes in the contract asset and liability balances during the three months ended March 31, 2020 were not materially impacted by any other factors.

Contract balances consist of the following (in thousands):

	March 31, 2020		December 31, 2019
Contract Assets
Trade accounts receivable, net	$	62,462	$	71,183
Unbilled accounts receivable	1,436		1,079
Costs to fulfill	4,293		4,875
Total contract assets	$	68,191	$	77,137
Contract Liabilities
Accrued contract liabilities	$	1,303	$	1,806
Deferred revenue	5,805		7,456
Total contract liabilities	$	7,108	$	9,262

Remaining performance obligations represent the transaction price of firm orders for which work has not yet been performed. This amount does not include 1) contracts that are less than one year in duration, 2) contracts for which we recognize revenue based on the right to invoice for services performed, or 3) variable consideration allocated entirely to a wholly unsatisfied performance obligation. Much of our revenue qualifies for one of these exemptions. As of March 31, 2020, the aggregate amount of the transaction price allocated to remaining performance obligations for contracts with an original expected duration of one year or more was $11.7 million. We expect to recognize revenue on approximately 87% of the remaining performance obligations in 2020, 12% in 2021, and the remaining recognized thereafter.