Revenue

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Disaggregation of Revenue

The following table presents a summary of revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Subscription revenue	$	156,764	$	122,156	$	446,257	$	343,725
Perpetual license and maintenance revenue	12,658		12,749		38,214		37,721
Professional services and other revenue	5,429		3,759		14,089		10,666
Revenue	$	174,851	$	138,664	$	498,560	$	392,112

Concentrations

We sell and market our products and services through our field sales force that works closely with our channel partners, which includes a network of distributors and resellers, in developing sales opportunities. We use a two-tiered channel model whereby we sell our products and services to our distributors, which in turn sell to resellers, which then sell to end-users. We derived 92% of revenue through our channel network in the three and nine months ended September 30, 2022 and 2021. One of our distributors accounted for 38% of revenue in the three and nine months ended September 30, 2022 and 39% and 40% of revenue in the three and nine months ended September 30, 2021, respectively. That same distributor accounted for 38% and 32% of accounts receivable at September 30, 2022 and December 31, 2021, respectively.

Contract Balances

We generally bill our customers in advance and accounts receivable are recorded when we have the right to invoice the customer. Contract liabilities consist of deferred revenue and include customer billings and payments received in advance of performance under the contract. In the three months ended September 30, 2022 and 2021 and the nine months ended September 30, 2022 and 2021, we recognized revenue of $156.3 million, $124.6 million, $350.6 million and $283.3 million, respectively, that was included in the deferred revenue balance at the beginning of each of the respective periods.

Remaining Performance Obligations

At September 30, 2022, the future estimated revenue related to unsatisfied performance obligations was $612.8 million, of which approximately 75% is expected to be recognized as revenue over the succeeding twelve months, and the remainder is expected to be recognized over the four years thereafter.

Deferred Commissions

The following summarizes the activity of deferred incremental costs of obtaining a contract:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Beginning balance	$	100,000	$	78,497	$	99,949	$	78,876
Capitalization of contract acquisition costs	12,837		12,109		35,240		29,555
Amortization of deferred contract acquisition costs	(11,561)		(9,368)		(33,913)		(27,193)
Ending balance	$	101,276	$	81,238	$	101,276	$	81,238