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Revenue Recognition, Contracts with Customers | 3 Months Ended
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Jul. 31, 2022
Revenue Recognition, Contracts with Customers [Abstract] |
Revenue Recognition, Contracts with Customers | Note 4 — Revenue Recognition, Contracts with Customers Disaggregation of Revenue The following table presents our revenue from contracts with customers disaggregated by segment and product type.
|  | Three Months Ended July 31, |
|  | 2022 |  |  | 2021 |
Research (1): |  |  |  |  |  |
Research Publishing (2) |  | $ | 239,523 |  |  | $ | 243,284 |
Research Solutions (2) |  |  | 35,390 |  |  |  | 31,472 |
Total Research |  |  | 274,913 |  |  |  | 274,756 |
Academic & Professional Learning: |  |  |  |  |  |  |  |
Education Publishing |  |  | 63,056 |  |  |  | 66,380 |
Professional Learning |  |  | 69,903 |  |  |  | 72,884 |
Total Academic & Professional Learning |  |  | 132,959 |  |  |  | 139,264 |
Education Services: |  |  |  |  |  |  |  |
University Services (3) |  |  | 47,811 |  |  |  | 54,968 |
Talent Development Services (3) |  |  | 31,886 |  |  |  | 19,400 |
Total Education Services |  |  | 79,697 |  |  |  | 74,368 |
Total Revenue |  | $ | 487,569 |  |  | $ | 488,388 |
(1) | The Research segment was previously referred to as Research Publishing & Platforms.
(2) | As previously announced, in May 2022 our revenue by product type previously referred to as Research Platforms was changed to Research Solutions. Research Solutions includes infrastructure and publishing services that help societies and corporations thrive in a complex knowledge ecosystem. In addition to Platforms (Atypon), certain product offerings such as corporate sales which included the recent acquisitions of Madgex Holdings Limited (Madgex), and Bio-Rad Laboratories Inc.’s Informatics products (Informatics) that were previously included in Research Publishing moved to Research Solutions to align with our strategic focus. Research Solutions also includes product offerings related to certain recent acquisitions such as J&J, and EJP. Prior period results have been revised to the new presentation. There were no changes to the total Research segment or our consolidated financial results. The revenue reclassified to Research Solutions was $20.0 million for the three months ended July 31, 2021.
(3) | In May 2022, we moved the WileyNXT product offering from Talent Development Services to University Services and the prior period results have been included in University Services. The revenue reclassified was $0.6 million for the three months ended July 31, 2021. There were no changes to the total Education Services segment or our total consolidated financial results.
The following information describes our disaggregation of revenue by segment and product type. Overall, the majority of our revenue is recognized over time. Research Research customers include academic, corporate, government, and public libraries, funders of research, researchers, scientists, clinicians, engineers and technologists, scholarly and professional societies, and students and professors. Research products are sold and distributed globally through multiple channels, including research libraries and library consortia, independent subscription agents, direct sales to professional society members, and other customers. Publishing centers include Australia, China, Germany, India, the United Kingdom (UK), and the United States (US). The majority of revenue generated from Research products is recognized over time. Total Research revenue was $274.9 million in the three months ended July 31, 2022. We disaggregated revenue by Research Publishing and Research Solutions to reflect the different type of products and services provided. Research Publishing Products Research Publishing products provide scientific, technical, medical, and scholarly journals, as well as related content and services to academic, corporate, and government libraries, learned societies, and individual researchers and other professionals. Research Publishing revenue was $239.5 million in the three months ended July 31, 2022 and the majority is recognized over time. Research Publishing products generate approximately 87% of its revenue from contracts with its customers from Journal Subscriptions (pay to read), Open Access (pay to publish) and Transformational Agreements (read and publish) and the remainder from Licensing, Reprints, Backfiles, and Other. Research Solutions Products and Services Research Solutions services include Atypon Systems, Inc (Atypon) a publishing software and service provider that enables scholarly and professional societies and publishers to deliver, host, enhance, market, and manage their content on the web through the Literatum platform. In addition, Research Solutions includes advertising, spectroscopy software and spectral databases, and job board software and career center services, which includes the products and services from the recent acquisitions of Madgex and Informatics. As well as product and service offerings related to recent acquisitions such as J&J Editorial Services, LLC. (J&J) and the eJournalPress (EJP) business. J&J is a publishing services company providing expert offerings in editorial operations, production, copyediting, system support and consulting. EJP is a technology platform company with an established journal submission and peer-review management system. Research Solutions revenue was $35.4 million in the three months ended July 31, 2022 and the majority is recognized over time. Academic & Professional Learning Academic & Professional Learning provides Education Publishing and Professional Learning products and services including scientific, professional, and education print and digital books, digital courseware, and test preparation services to libraries, corporations, students, professionals, and researchers, as well as learning, development, and assessment services for businesses and professionals. Communities served include business, finance, accounting, workplace learning, management, leadership, technology, behavioral health, engineering/architecture, science and medicine, and education. Products are developed for worldwide distribution through multiple channels, including chain and online booksellers, libraries, colleges and universities, corporations, direct to consumer, web sites, distributor networks and other online applications. Publishing centers include Australia, Germany, India, the UK, and the US. Total Academic & Professional Learning revenue was $133.0 million in the three months ended July 31, 2022. We disaggregated revenue by type of products provided. Academic & Professional Learning products are Education Publishing and Professional Learning. Academic & Professional Learning revenues are mainly recognized at a point in time. Education Publishing Products Education Publishing products revenue was $63.1 million in the three months ended July 31, 2022. Education Publishing products generate approximately 74% of its revenue from contracts with its customers from Education (print and digital) Publishing, which is recognized at a point in time, and 7% from Digital Courseware which is recognized over time. The remainder of its revenues were from Test Preparation and Certification, and Licensing and Other, which has a mix of revenue recognized at a point in time and over time. Professional Learning Products Professional Learning products revenue was $69.9 million in the three months ended July 31, 2022. Professional Learning (print and digital) products generate approximately 59% of revenue from contracts with its customers from Professional Publishing, and Licensing and Other, and both are mainly recognized at a point in time. Approximately 41% of Professional Learning products revenue is from contracts with its customers from Corporate Training and Corporate Learning, which is recognized mainly over time. Education Services Education Services revenue was $79.7 million in the three months ended July 31, 2022 and the majority is recognized over time. We disaggregated revenue by type of services provided, which are University Services and Talent Development Services. University Services University Services revenue was $47.8 million in the three months ended July 31, 2022 and is mainly recognized over time. University Services primarily engages in the comprehensive management of online degree programs for universities and has grown to include a broad array of technology enabled service offerings that address our partner specific pain points. Increasingly, this includes delivering career credentialing education that advances specific careers with in-demand skills. Talent Development Services Talent Development Services revenue was $31.9 million in the three months ended July 31, 2022 and is recognized at the point in time the services are provided to its customers. Talent Development Services is a talent placement provider that finds, trains and places job-ready technology talent in roles with leading corporations worldwide. Accounts Receivable, net and Contract Liability Balances When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities are recognized as revenue when, or as, control of the products or services are transferred to the customer and all revenue recognition criteria have been met. The following table provides information about accounts receivable, net and contract liabilities from contracts with customers.
|  | July 31, 2022 |  |  | April 30, 2022 |  |  | Increase/ (Decrease) |
Balances from contracts with customers: |  |  |  |  |  |  |  |  |
Accounts receivable, net |  | $ | 281,443 |  |  | $ | 331,960 |  |  | $ | (50,517 | )
Contract liabilities (1) |  |  | 407,098 |  |  |  | 538,126 |  |  |  | (131,028 | )
Contract liabilities (included in Other long-term liabilities) |  | $ | 20,171 |  |  | $ | 19,072 |  |  | $ | 1,099 |
(1) | The sales return reserve recorded in Contract liabilities is $29.6 million and $31.1 million, as of July 31, 2022 and April 30, 2022, respectively.
For the three months ended July 31, 2022, we estimate that we recognized revenue of approximately 43% that was included in the current contract liability at April 30, 2022. The decrease in contract liabilities excluding the sales return reserve, was primarily driven by revenue earned on journal subscription agreements, transformational agreements, and open access, partially offset by renewals of journal subscription agreements, transformational agreements, and open access. Remaining Performance Obligations included in Contract Liability As of July 31, 2022, the aggregate amount of the transaction price allocated to the remaining performance obligations is approximately $427.3 million, which included the sales return reserve of $29.6 million. Excluding the sales return reserve, we expect that approximately $377.5 million will be recognized in the next twelve months with the remaining $20.2 million to be recognized thereafter. Assets Recognized for the Costs to Fulfill a Contract Costs to fulfill a contract are directly related to a contract that will be used to satisfy a performance obligation in the future and are expected to be recovered. These costs are amortized on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. These types of costs are incurred in the following product types, (1) Research Solutions services, which includes customer specific implementation costs per the terms of the contract and (2) University Services, which includes customer specific costs to develop courses per the terms of the contract. Our assets associated with incremental costs to fulfill a contract were $10.7 million and $10.9 million at July 31, 2022 and April 30, 2022, respectively, and are included within Other non-current assets on our Unaudited Condensed Consolidated Statements of Financial Position. We recorded amortization expense of $1.2 million and $1.5 million in the three months ended July 31, 2022 and 2021, respectively, related to these assets within Cost of sales on our Unaudited Condensed Consolidated Statements of Net (Loss) Income. Sales and value-added taxes are excluded from revenues. Shipping and handling costs, which are primarily incurred within the Academic & Professional Learning segment, occur before the transfer of control of the related goods. Therefore, in accordance with the revenue standard, it is not considered a promised service to the customer and would be considered a cost to fulfill our promise to transfer the goods. Costs incurred for third party shipping and handling are primarily reflected in Operating and administrative expenses on our Unaudited Condensed Consolidated Statements of Net (Loss) Income. We incurred $6.5 million and $6.8 million in shipping and handling costs in the three months ended July 31, 2022 and 2021, respectively.

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