Revenue Recognition

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

Disaggregation of Revenue

The following table presents our revenue disaggregated by major product and service lines (in millions):

	Three Months Ended
	March 31, 2023		March 31, 2022
Product	$	500.7	$	371.0
Service:
Security subscription	421.7		312.9
Technical support and other	339.9		270.9
Total service revenue	761.6		583.8
Total revenue	$	1,262.3	$	954.8

Deferred Revenue

During the three months ended March 31, 2023 and 2022, we recognized $675.9 million and $507.3 million in service revenue that was included in the deferred revenue balance as of December 31, 2022 and 2021, respectively.

Transaction Price Allocated to the Remaining Performance Obligations

As of March 31, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $4.91 billion, which was substantially comprised of deferred security subscription, technical support services revenue and unbilled contract revenue from non-cancellable contracts that will be recognized in future periods. We expect to recognize approximately $2.49 billion as revenue over the next 12 months and the remainder thereafter.

Accounts receivable

Trade accounts receivable are recorded at the invoiced amount, net of an allowance for expected credit losses. We measure expected credit losses of accounts receivable on a collective (pooled) basis, aggregating accounts receivable that are either current or no more than 60 days past due, and aggregating accounts receivable that are more than 60 days past due. We apply a credit-loss percentage to each of the pools that is based on our historical credit losses. We review whether each of our significant accounts receivable that is more than 60 days past due continues to exhibit similar risk characteristics with the other accounts receivable in the pool. If we determine that it does not, we evaluate it for expected credit losses on an individual basis. Expected credit losses are recorded as general and administrative expenses on our consolidated statements of income.

The allowance for credit losses was $6.7 million and $3.6 million as of March 31, 2023 and December 31, 2022, respectively. Provisions, write-offs and recoveries were not material during the three months ended March 31, 2023 and 2022.

Deferred Contract Costs

Amortization of deferred contract costs during the three months ended March 31, 2023 and 2022 were $62.5 million and $52.5 million, respectively.