Revenues |
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May 31, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenues [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | Revenues Disaggregation of Revenue See Note 12 (Segment Reporting) to these Consolidated Financial Statements for our disaggregated revenues. Remaining Performance Obligations We had remaining performance obligations of approximately $38 billion and $34 billion as of May 31, 2026 and August 31, 2025, respectively. Our remaining performance obligations represent the amount of transaction price for which work has not been performed and revenue has not been recognized. The majority of our contracts are terminable by the client on short notice with little or no termination penalties, and some without notice. Under Topic 606, only the non-cancelable portion of these contracts is included in our performance obligations. Additionally, our performance obligations only include variable consideration if we assess it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty is resolved. Based on the terms of our contracts, a significant portion of what we consider contract bookings is not included in our remaining performance obligations. We expect to recognize approximately 33% of our remaining performance obligations as of May 31, 2026 as revenue in fiscal 2026, an additional 35% in fiscal 2027, and the balance thereafter. Contract Estimates Adjustments in contract estimates related to performance obligations satisfied or partially satisfied in prior periods were immaterial for the three and nine months ended May 31, 2026 and 2025, respectively. Contract Balances The timing of revenue recognition, billings and cash collections results in Receivables, Contract assets, and Contract liabilities (Deferred revenues) on our Consolidated Balance Sheet. Our receivables are rights to consideration that are conditional only upon the passage of time as compared to our contract assets, which are rights to consideration conditional upon additional factors. When we bill or receive payments from our clients before revenue is recognized, we record Contract liabilities (Deferred revenues). Deferred revenues also include payments for transition or set-up activities on managed services contracts, which are deferred and recognized as revenue as the services are provided. Deferred transition revenues were $669,347 and $642,361 as of May 31, 2026 and August 31, 2025, respectively, and are included in Non-current deferred revenues. Costs related to these activities are also deferred and are expensed as the services are provided. Deferred transition costs were $1,136,760 and $1,025,391 as of May 31, 2026 and August 31, 2025, respectively, and are included in Deferred contract costs. Generally, deferred transition costs are recoverable under the contract in the event of early termination and are monitored regularly for impairment. Impairment losses are recorded when projected remaining undiscounted operating cash flows of the related contract are not sufficient to recover the carrying amount of contract assets. The following table provides information about the balances of our Receivables and Contract assets, net of allowance, and Contract liabilities (Deferred revenues):
Changes in the contract asset and liability balances during the nine months ended May 31, 2026 were a result of normal business activity and not materially impacted by any other factors. Revenues recognized during the three and nine months ended May 31, 2026 that were included in Deferred revenues as of February 28, 2026 and August 31, 2025 were $3.3 billion and $4.9 billion, respectively. Revenues recognized during the three and nine months ended May 31, 2025 that were included in Deferred revenues as of February 28, 2025 and August 31, 2024 were $2.8 billion and $4.1 billion, respectively.
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