Revenue

9 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The Company disaggregates revenue by type of product, by geographical market, and by products sold to indirect sales channel partners or direct customers and original equipment manufacturers ("OEMs") that depict the nature, amount, and timing of revenue and cash flows. Service revenues are not a significant component of total revenue and are aggregated within the respective categories.

The following is a summary of net sales by product type (in thousands):



	Three Months Ended March 31,				Nine Months Ended March 31,
	2020		2019		2020		2019
Server and storage systems	$	571,291	$	592,783	$	1,880,043	$	2,161,321
Subsystems and accessories	201,117		150,716		563,112		484,805
Total	$	772,408	$	743,499	$	2,443,155	$	2,646,126

Server and storage systems constitute an assembly and integration of subsystems and accessories, and related services. Subsystems and accessories are comprised of serverboards, chassis and accessories.

International net sales are based on the country and region to which the products were shipped. The following is a summary for the three and nine months ended March 31, 2020 and 2019, of net sales by geographic region (in thousands):



	Three Months Ended March 31,				Nine Months Ended March 31,
	2020		2019		2020		2019
United States	$	422,872	$	436,734	$	1,419,117	$	1,516,262
Europe	158,144		128,789		433,767		472,325
Asia	160,472		146,120		487,827		549,296
Others	30,920		31,856		102,444		108,243
	$	772,408	$	743,499	$	2,443,155	$	2,646,126

The following table presents the net sales from products sold through the Company's indirect sales channel and to its direct customers and OEMs for the three and nine months ended March 31, 2020 and 2019 (in thousands):



	Three Months Ended March 31,				Nine Months Ended March 31,
	2020		2019		2020		2019
Indirect sales channel	$	445,980	$	284,204	$	1,292,472	$	997,983
Direct customers and OEMs	326,428		459,295		1,150,683		1,648,143
Total net sales	$	772,408	$	743,499	$	2,443,155	$	2,646,126

Contract Balances

Generally, the payment terms of the Company’s offerings range from 30 to 60 days. In certain instances, customers may prepay for products and services in advance of delivery. Accounts receivable relate to the Company’s right to consideration for performance obligations completed (or partially completed) for which the Company has an unconditional right to consideration.

Contract assets are rights to consideration in exchange for goods or services that the Company has transferred to a customer when such right is conditional on something other than the passage of time. Such contract assets are insignificant to the Company’s condensed consolidated financial statements.

Contract liabilities consist of deferred revenue and relate to amounts invoiced to or advance consideration received from customers, which precede the Company’s satisfaction of the associated performance obligation(s). The Company’s deferred revenue primarily results from customer payments received upfront for extended warranties and on-site services because these performance obligations are satisfied over time. Revenue recognized during the three and nine months ended March 31, 2020, which was included in the opening deferred revenue balance as of June 30, 2019, was $22.9 million and $71.6 million, respectively.

Deferred revenue increased during the nine months ended March 31, 2020 because the amounts for service contracts invoiced during the period exceeded the recognition of revenue from contracts entered into in prior periods.

Transaction Price Allocated to the Remaining Performance Obligations

Remaining performance obligations represent in aggregate the amount of transaction price that has been allocated to performance obligations not delivered, or only partially undelivered, as of the end of the reporting period. The Company applies the optional exemption to not disclose information about remaining performance obligations that are part of a contract that has an original expected duration of one year or less. These performance obligations generally consist of services, such as on-site integration services and extended warranty services that are contracted for one year or less, and products for which control has not yet been transferred. The value of the transaction price allocated to remaining performance obligations as of March 31, 2020 was approximately $205.5 million. The Company expects to recognize approximately 53% of remaining performance obligations as revenue in the next 12 months, and the remainder thereafter.