Revenue Recognition

3 Months Ended

Nov. 30, 2023

Revenue Recognition [Abstract]

Revenue Recognition

NOTE 4 – REVENUE RECOGNITION

Contract Balances

Our deferred revenue totaled $103.3 million at November 30, 2023 and $111.2 million at August 31, 2023, of which $3.8 million and $3.7 million were classified as components of other long-term liabilities at November 30, 2023, and August 31, 2023, respectively. The amount of deferred revenue that was generated from subscription offerings totaled $87.2 million at November 30, 2023 and $99.0 million at August 31, 2023. During the quarter ended November 30, 2023, we recognized $36.6 million of previously deferred subscription revenue.

Deferred subscription revenue primarily consists of billings or payments received in advance of revenue being recognized from subscription services. Deferred revenue is recognized in sales as the applicable revenue recognition criteria are met. We generally invoice customers in annual installments upon execution of a contract. With the Leader in Me offering, the contract includes both a subscription membership and onsite consulting which can be invoiced to the client in one lump sum. In this circumstance, the entire lump sum is included in deferred subscription revenue. The deferred subscription revenue related to the Leader in Me membership is recognized as revenue over the life of the contract whereas the consulting is recognized when the service takes place.

Remaining Performance Obligations

Whenever possible, we enter into multi-year non-cancellable contracts which are invoiced either upon execution of the contract or at the beginning of each annual contract period. Remaining transaction price represents contracted revenue that has not yet been recognized, including unearned revenue and unbilled amounts that will be recognized as revenue in future periods. Transaction price is influenced by factors such as inflation, the average length of the contract term, and the ability of the Company to continue to enter into multi-year non-cancellable contracts. At November 30, 2023, we had $169.7 million of remaining performance obligations, including our deferred subscription revenue. The remaining performance obligation does not include other deferred revenue, as amounts included in other deferred revenue contain items such as deposits that are generally refundable at the client’s request prior to the satisfaction of the obligation.

Disaggregated Revenue Information

Refer to Note 7, Segment Information, to these condensed consolidated financial statements for our disaggregated revenue information.