Revenue

6 Months Ended

Jan. 31, 2022

Revenue from Contract with Customer [Abstract]

Revenue

Note 2—Revenue

Disaggregation of Revenue

The following table summarizes revenue by type of monetization mechanisms of the Zedge App and other revenues, including Emojipedia revenues. for the periods presented:

	Three Months Ended				Six Months Ended
	January 31,				January 31,
	2022		2021		2022		2021
	(in thousands)				(in thousands)
Advertising revenue	$	5,437	$	4,399	$	10,006	$	7,385
Paid subscription revenue		953		809		1,913		1,459
Other revenues		525		106		1,024		232
Total revenues	$	6,915	$	5,314	$	12,943	$	9,076

Contract Balances

Deferred revenues

The Company records deferred revenues related to the unsatisfied performance obligations with respect to subscription revenue. As of January 31, 2022, the Company’s deferred revenue balance related to paid subscriptions was approximately $1,505,000, representing approximately 762,000 active subscribers including those under the account hold designation implemented by Google Play on November 1, 2020. Account hold is a subscription state that begins when a user’s form of payment fails and the three-day grace period has ended without payment resolution. The account hold period lasts for up to 30 days. As of July 31, 2021, the Company’s deferred revenue balance related to paid subscriptions was approximately $1,603,000, representing approximately 752,000 active subscribers. The amount of revenue recognized in the six months ended January 31, 2022 that was included in the deferred balance at July 31, 2021 was $1,218,000.

The Company also records deferred revenues when users purchase or earn Zedge Credits. Unused Zedge Credits represent the value of the Company’s unsatisfied performance obligation to its users. Revenue is recognized when Zedge App users use Zedge Credits to acquire Zedge Premium content or upon expiration of the Zedge Credits upon 180 days of account inactivity. As of January 31, 2022, and July 31, 2021, the Company’s deferred revenue balance related to Zedge Premium was approximately $277,000 and $218,000, respectively.

Total deferred revenues decreased by $39,000 from $1,821,000 at July 31, 2021 to $1,782,000 at January 31, 2022, primarily attributed to the decline in new subscriptions sales in the three and six months ended January 31, 2022 when compared to the prior periods.

Significant Judgments

The advertising networks and advertising exchanges to which we sell our inventory track and report the impressions and installs to Zedge and Zedge recognizes revenues based on these reports. The networks and exchanges base their payments off of those reports and Zedge independently compares the data to each of the client sites to validate the imported data and identify any differences. The number of impressions and installs delivered by the advertising networks and advertising exchanges is determined at the end of each month, which resolves any uncertainty in the transaction price during the reporting period.

 Practical Expedients

The Company expenses the fees retained by Google Play related to subscription revenue when incurred as marketing expense because the duration of the contracts for which the Company pays commissions are less than one year. These costs are included in the selling, general and administrative expenses of the Consolidated Statements of Comprehensive Income.