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Revenue Recognition
3 Months Ended
Mar. 31, 2022
Revenue Recognition [Abstract]  
Revenue Recognition

3. Revenue Recognition

The Company derives its revenue primarily from software development services and software subscriptions. Applicable revenue recognition criteria are considered separately for each performance obligation as follows:

 

Service revenue consists primarily of revenue earned from the performance of software development and, to a lesser extent, professional services. The majority of services contracts are structured as time and materials agreements. Revenue for services is generally recognized as the services are performed. Billing for services rendered generally occurs within one month after the services are provided.

 

Subscription revenue consists primarily of revenue earned from the licensing of software products and, to a lesser extent, the licensing and sale of intellectual property. The majority of subscription contracts are recurring, paid in advance, and recognized over the term of the subscription, which is typically one to three years.

Customer arrangements may contain multiple performance obligations such as software development services, software products, and maintenance and support fees. The Company accounts for individual products and services separately if they are distinct. To determine the transaction price, the Company considers the terms of the contract and the Company’s customary business practices. Some contracts may contain variable consideration. In those cases, the Company estimates the amount of variable consideration based on the sum of probability-weighted amounts in a range of possible consideration amounts. As part of this assessment, the Company will evaluate whether any of the variable consideration is constrained and if it is the Company will not include it in the transaction price. The consideration is allocated between distinct products and services based on their stand-alone selling prices. For items that are not sold separately, the Company estimates the standalone selling price based on reasonably available

information, including market conditions, specific factors affecting the Company, and information about the customer. For distinct products and services, the Company typically recognizes the revenue associated with these performance obligations as they are delivered to the customer.  Products and services that are not capable of being distinct are combined with other products or services until a distinct performance obligation is identified.

All revenue recognized in the Consolidated Statements of Operations is considered to be revenue from contracts with customers.

The following table provides information about disaggregated revenue by major target market in the Company’s single reporting segment:

 

 

Three

 

 

Three

 

 

 

Months

 

 

Months

 

 

 

Ended

 

 

Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2022

 

 

2021

 

Government

 

 

 

 

 

 

 

 

Service

 

$

3,272

 

 

$

3,585

 

Subscription

 

 

300

 

 

 

300

 

Total Government

 

 

3,572

 

 

 

3,885

 

Commercial

 

 

 

 

 

 

 

 

Service

 

$

348

 

 

$

199

 

Subscription

 

 

3,491

 

 

 

2,616

 

Total Commercial

 

 

3,839

 

 

 

2,815

 

Total

 

$

7,411

 

 

$

6,700

 

 

The Company has contract assets from contracts with customers that are classified as “trade accounts receivable” in the Consolidated Balance Sheets. Financial information about trade accounts receivable is included in Note 8.  

The Company has contract liabilities from contracts with customers that are classified as “deferred revenue” in the Consolidated Balance Sheets. Deferred revenue consists of billings in advance for services and subscriptions for which the performance obligation has not been satisfied.

The following table provides information about contract liabilities from contracts with customers:

 

 

March 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Deferred revenue, current

 

$

4,315

 

 

$

2,989

 

Deferred revenue, long-term

 

 

46

 

 

 

33

 

Total

 

$

4,361

 

 

$

3,022

 

The Company recognized $1,351 of revenue during the three months ended March 31, 2022, that was included in the contract liability balance as of December 31, 2021.

The aggregate amount of the transaction prices from contractual obligations that are unsatisfied or partially unsatisfied was $25,339 and $16,870 as of March 31, 2022, and December 31, 2021, respectively.