v3.23.1
Revenue, Deferred Revenue and Remaining Performance Obligations
 3 Months Ended
Apr. 30, 2023
Revenue from Contract with Customer [Abstract]  
Revenue, Deferred Revenue and Remaining Performance Obligations Revenue, Deferred Revenue and Remaining Performance Obligations
The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use the Company’s platform or service (in thousands, except percentages):
Three Months Ended April 30,
20232022
Amount% RevenueAmount% Revenue
United States$474,825 69 %$345,593 71 %
Europe, Middle East, and Africa104,552 15 %70,625 14 %
Asia Pacific72,219 10 %48,079 10 %
Other40,984 6 %23,537 5 %
Total revenue$692,580 100 %$487,834 100 %
No single country other than the United States represented 10% or more of the Company’s total revenue during the three months ended April 30, 2023 and April 30, 2022.
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. The Company recognized revenue of $596.4 million and $397.7 million for the three months ended April 30, 2023 and April 30, 2022, respectively, which was included in the corresponding contract liability balance at the beginning of the period.
The Company receives payments from customers based upon contractual billing schedules. Accounts receivable are recorded when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 - 60 days. Contract assets include amounts related to the contractual right to consideration for both completed and partially completed performance obligations that may not have been invoiced.
Changes in deferred revenue were as follows (in thousands):
Three Months Ended April 30,
20232022
Carrying Amount
Beginning balance2,355,113 1,529,321 
Additions to deferred revenue741,258 651,110 
Recognition of deferred revenue(692,580)(487,834)
Ending balance2,403,791 1,692,597 
Remaining Performance Obligations
The Company’s subscription contracts with its customers have a typical term of one to three years and most subscription contracts are non-cancelable. Customers generally have the right to terminate their contracts for cause as a result of the Company’s failure to perform. As of April 30, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $3.3 billion. The Company expects to recognize approximately 64% of the remaining performance obligations in the 12 months following April 30, 2023 and 35% of the remaining performance obligations between 13 to 36 months, with the remainder to be recognized thereafter.
Costs to Obtain and Fulfill a Contract
The Company capitalizes referral fees paid to partners and sales commissions and associated payroll taxes paid to internal sales personnel, contractors or sales agents that are incremental to the acquisition of channel partner and direct customer contracts and would not have occurred absent the customer contract. These costs are recorded as deferred contract acquisition costs, current and deferred contract acquisition costs, noncurrent on the condensed consolidated balance sheets.
Sales commissions for renewal of a contract are not considered commensurate with the commissions paid for the acquisition of the initial contract or follow-on upsell given the substantive difference in commission rates in proportion to their respective contract values. Commissions, including referral fees paid to referral partners, earned upon the initial acquisition of a contract or subsequent upsell are amortized over an estimated period of benefit of four years, while commissions earned for renewal contracts are amortized over the contractual term of the renewals. Sales commissions associated with professional service contracts are amortized ratably over an estimated period of benefit of eight months and are included in sales and marketing expense in the condensed consolidated statements of operations. In determining the period of benefit for commissions paid for the acquisition of the initial contract, the Company took into consideration the expected subscription term and expected renewals of customer contracts, the historical duration of relationships with customers, customer retention data, and the life of the developed technology. The Company periodically reviews the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred costs. The Company did not recognize any material impairment losses of deferred contract acquisition costs during the three months ended April 30, 2023 and April 30, 2022.
The following table summarizes the activity of deferred contract acquisition costs (in thousands):
Three Months Ended April 30,
20232022
Beginning balance$447,088 $319,180 
Capitalization of contract acquisition costs49,532 51,354 
Amortization of deferred contract acquisition costs(55,322)(37,592)
Ending balance$441,298 $332,942 
Deferred contract acquisition costs, current$186,901 $135,681 
Deferred contract acquisition costs, noncurrent254,397 197,261 
Total deferred contract acquisition costs$441,298 $332,942