Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

3.Revenue from contracts with customers

Disaggregation of revenue

The Company disaggregates its software revenue by type of performance obligation and timing of revenue recognition as follows (in thousands):

	Three Months Ended  June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Term licenses and other (1)	$	72,485	$	57,624	$	166,530	$	142,558
Perpetual licenses		10,203		9,008		22,327		20,469
Maintenance		33,035		30,549		66,372		60,243
Professional software services (1)		1,170		2,377		2,561		5,829
Software related services		7,376		7,481		16,437		15,579
Client engineering services		7,047		10,268		15,059		20,945
Other		1,340		2,605		3,151		4,452
Total revenue	$	132,656	$	119,912	$	292,437	$	270,075

(1)Term licenses and other includes hardware revenue of $1.7 million and $2.4 million, respectively, for the three and six months ended June 30, 2022, and was reported in License revenue. Professional software services includes hardware revenue of $1.3 million and $3.0 million, respectively, for the three and six months ended June 30, 2021, and was reported in Maintenance and other services revenue.

The Company derived approximately 12.7% and 10.7% of its total revenue through indirect sales channels for the six months ended June 30, 2022 and 2021, respectively.

Costs to obtain a contract

As of June 30, 2022, and December 31, 2021, respectively, capitalized costs to obtain a contract were $4.3 million and $4.5 million recorded in Prepaid and other current assets and $0.2 million and $0.4 million recorded in Other long-term assets in the Company’s consolidated balance sheets. Sales commissions were $2.1 million and $4.2 million, respectively, for the three and six months ended June 30, 2022, and $1.9 million and $3.5 million, respectively, for the three and six months ended June 30, 2021. Sales commissions were included in Sales and marketing expense in the Company’s consolidated statement of operations.

Contract assets

As of June 30, 2022, and December 31, 2021, respectively, contract assets were $4.5 million and $3.8 million included in Accounts receivable, and $2.7 million and $2.3 million included in Prepaid expenses and other current assets in the Company’s consolidated balance sheets.

Deferred revenue

Approximately $65.0 million of revenue recognized during the six months ended June 30, 2022, was included in deferred revenue at the beginning of the year.

Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. Contracted revenue not yet recognized was $147.6 million and $128.5 million as of June 30, 2022 and 2021, respectively. Of the amount recorded as of June 30, 2022, the Company expects to recognize approximately 73% over the next 12 months and the remainder thereafter.