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Summary of significant accounting policies | 6 Months Ended
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Jun. 30, 2024
Accounting Policies [Abstract] |
Summary of significant accounting policies | Summary of significant accounting policies The Company’s significant accounting policies are discussed in Note 2 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. There have been no significant changes to these policies during the three and six months ended June 30, 2024. The following describes the impact of certain policies. Revenue recognition The Company applies ASC 606 and follows a five-step model to determine the appropriate amount of revenue to be recognized in accordance with ASC 606. Disaggregation of Revenue The Company separates revenue into subscription and non-subscription categories to disaggregate the revenue that is term-based and renewable from the revenue that is one-time in nature. Revenue from subscription and non-subscription contractual arrangements were as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
| (in thousands)
SaaS subscription and support and maintenance | $ | 146,101 |  |  | $ | 126,566 |  |  | $ | 288,507 |  |  | $ | 247,328 |
On‑premise subscription | 3,327 |  |  | 4,025 |  |  | 9,274 |  |  | 10,493 |
Subscription revenue | 149,428 |  |  | 130,591 |  |  | 297,781 |  |  | 257,821 |
Professional services | 3,497 |  |  | 4,254 |  |  | 7,203 |  |  | 8,638 |
Perpetual licenses | 91 |  |  | 244 |  |  | 155 |  |  | 842 |
Non‑subscription revenue | 3,588 |  |  | 4,498 |  |  | 7,358 |  |  | 9,480 |
Total revenue | $ | 153,016 |  |  | $ | 135,089 |  |  | $ | 305,139 |  |  | $ | 267,301 |
Contract Balances Contract liabilities consist of customer billings in advance of revenue being recognized. The Company invoices its customers for subscription, support and maintenance, and services in advance. Changes in contract liabilities, including revenue earned during the period from the beginning contract liability balance and new deferrals of revenue during the period, were as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
| (in thousands)
Balance, beginning of the period | $ | 364,503 |  |  | $ | 340,842 |  |  | $ | 373,432 |  |  | $ | 346,150 |
Revenue earned | (128,206) |  |  | (112,723) |  |  | (223,890) |  |  | (193,872) |
Deferral of revenue | 136,348 |  |  | 127,917 |  |  | 223,103 |  |  | 203,758 |
Other (1) | (2,439) |  |  | (985) |  |  | (2,439) |  |  | (985) |
Balance, end of the period | $ | 370,206 |  |  | $ | 355,051 |  |  | $ | 370,206 |  |  | $ | 355,051 |
(1) Includes contract assets netted against contract liabilities on a contract-by-contract basis. There were no significant changes to our contract assets and liabilities during the three and six months ended June 30, 2024 and 2023 outside of our sales activities. Remaining Performance Obligations Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancelable amounts to be invoiced. As of June 30, 2024, the Company had $506.7 million of remaining performance obligations, with 71% expected to be recognized as revenue over the succeeding 12 months, and the remainder generally expected to be recognized over the three years thereafter. Deferred Contract Costs Sales commissions, as well as associated payroll taxes and retirement plan contributions (together, “contract costs”), that are incremental to the acquisition of customer contracts are capitalized using a portfolio approach as deferred contract costs in the condensed consolidated balance sheets when the period of benefit is determined to be greater than one year. Total amortization of contract costs was $6.6 million and $5.2 million for the three months ended June 30, 2024 and 2023, respectively, and $12.9 million and $10.0 million for the six months ended June 30, 2024 and 2023, respectively. The Company periodically reviews these deferred contract costs to determine whether events or changes in circumstances have occurred that could affect the period of benefit of these deferred contract costs. There were no impairment losses recorded during the three and six months ended June 30, 2024 or 2023. Cloud computing arrangements Capitalized costs associated with the implementation of cloud computing arrangements were as follows:
Balance Sheet Classification |  | June 30, 2024 |  | December 31, 2023
|  | (in thousands)
Other current assets |  | $ | 5,457 |  |  | $ | 1,860 |
Other assets |  | 18,357 |  |  | 10,891 |
|  | $ | 23,814 |  |  | $ | 12,751 |
Stock Repurchases In May 2024, funds affiliated with Vista sold 8,956,522 shares of our common stock in an underwritten secondary offering. The Company did not receive any proceeds from the sale of common stock by Vista. In connection with this offering, we repurchased 2,000,000 shares of our common stock that were subject to the offering from the underwriters at the per-share price paid by the underwriters, or $17.52 per share, for an aggregate purchase price of $35.4 million. The Company funded the repurchase with existing cash on hand. These shares were purchased on May 16, 2024 and were subsequently retired. The terms and conditions of the stock repurchase were reviewed and approved by each of the audit committee members of our Board and our full Board. Recently issued accounting pronouncements not yet adopted In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This update requires companies to disclose specific categories in the effective tax rate reconciliation as well as provide additional information for reconciling items that meet a quantitative threshold. This update also requires disclosure of disaggregated information related to income taxes paid. This standard is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied on a prospective basis with the option to apply the guidance retrospectively. The Company is currently evaluating the effect the standard will have on disclosures within its condensed consolidated financial statements. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This update requires disclosure of significant segment expenses regularly provided to the CODM. Additionally, this update requires a description of how the CODM utilizes segment operating profit or loss to assess segment performance. All disclosure requirements in this standard are required for entities with a single reportable segment. The standard is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied on a retrospective basis to all periods presented. The Company is currently evaluating the effect the standard will have on disclosures within its condensed consolidated financial statements

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