v3.22.4
Revenue Recognition
 6 Months Ended
Jan. 31, 2023
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
Disaggregation of Revenue
Subscription and support revenue is recognized over time and accounted for approximately 97% of our revenue for each of the three and six months ended January 31, 2023 and 2022, respectively.
The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform:
Three Months Ended January 31,Six Months Ended January 31,
2023202220232022
Amount% RevenueAmount% RevenueAmount% RevenueAmount% Revenue
(in thousands, except per percentage data)
United States$193,508 50 %$125,419 49 %$369,023 50 %$238,832 49 %
Europe, Middle East and Africa 124,742 32 %88,174 35 %241,749 32 %168,723 35 %
Asia Pacific57,602 15 %36,029 14 %109,858 15 %67,080 14 %
Other11,746 3 %5,941 2 %22,516 3 %11,445 2 %
Total$387,598 100 %$255,563 100 %$743,146 100 %$486,080 100 %
The following table summarizes the revenue from contracts by type of customer:
Three Months Ended January 31,Six Months Ended January 31,
2023202220232022
Amount% RevenueAmount% RevenueAmount% RevenueAmount% Revenue
(in thousands, except per percentage data)
Channel partners$358,165 92 %$238,947 93 %$687,522 93 %$454,550 94 %
Direct customers29,433 8 %16,616 7 %55,624 7 %31,530 6 %
Total$387,598 100 %$255,563 100 %$743,146 100 %$486,080 100 %
Significant Customers
No single customer accounted for 10% or more of the total revenue or the total balance of accounts receivable, net in the periods presented.
Contract Balances
Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. Deferred revenue, including current and noncurrent balances, as of January 31, 2023 and July 31, 2022 was $1,111.9 million and $1,021.1 million, respectively. In the six months ended January 31, 2023 and 2022, we recognized revenue of $603.8 million and $378.6 million, respectively, that was included in the corresponding contract liability balance at the beginning of these periods.
Remaining Performance Obligations
The typical subscription and support term is one to three years. Most of our subscription and support contracts are non-cancelable over the contractual term. However, customers typically have the right to terminate their contracts for cause, if we fail to perform. As of January 31, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $2,809.2 million. We expect to recognize 51% of the transaction price over the next 12 months and 96% of the transaction price over the next three years, with the remainder recognized thereafter.
Costs to Obtain and Fulfill a Contract
We capitalize sales commission and associated payroll taxes paid to internal sales personnel that are incremental to the acquisition of channel partner and direct customer contracts. These costs are recorded as deferred contract acquisition costs in the condensed consolidated balance sheets.
The activity of the deferred contract acquisition costs consisted of the following:
Three Months Ended January 31,Six Months Ended January 31,
2023202220232022
(in thousands)
Beginning balance
$301,472 $216,103 $297,002 $207,030 
Capitalization of contract acquisition costs37,407 34,528 64,202 58,513 
Amortization of deferred contract acquisition costs(23,728)(16,126)(46,053)(31,038)
Ending balance
$315,151 $234,505 $315,151 $234,505 
The outstanding balance of the deferred contract acquisition costs consisted of the following:
January 31, 2023July 31, 2022
(in thousands)
Deferred contract acquisition costs, current$96,105 $86,210 
Deferred contract acquisition costs, noncurrent219,046 210,792 
Total deferred contract acquisition costs$315,151 $297,002 
Sales commissions accrued but not paid as of January 31, 2023 and July 31, 2022, totaled $23.5 million and $47.2 million, respectively, which are included within accrued compensation in the condensed consolidated balance sheets.