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Revenue
 9 Months Ended
Sep. 30, 2024
Revenue from Contract with Customer [Abstract]  
Revenue Revenue
Revenue by geography is based on the billing address of the customer. Aside from the United States, no other single country accounted for more than 10% of revenue for both the three and nine months ended September 30, 2024 and 2023. The following table presents the Company’s net revenue by geographic region:
Three months ended September 30,Nine months ended September 30,
2024202320242023
(in thousands)
United States$104,454 $93,422 $300,921 $268,660 
Asia Pacific14,609 18,935 51,030 52,633 
Europe13,015 10,493 36,364 31,877 
All other5,128 4,966 14,782 15,041 
Total revenue$137,206 $127,816 $403,097 $368,211 
The majority of the Company’s revenue is derived from enterprise customers, which are defined as customers with annualized current quarter revenue in excess of $100,000. This is calculated by taking the sum of revenue for each customer within the quarter and multiplying it by four. The following table presents the Company's net revenue for enterprise and non-enterprise customers:
Three months ended September 30,Nine months ended September 30,
2024202320242023
(in thousands)
Enterprise customers$126,660 $117,327 $369,451 $337,359 
Non-enterprise customers10,546 10,489 33,646 30,852 
Total revenue$137,206 $127,816 $403,097 $368,211 
The Company reports its revenue by three product lines: Network Services, Security and Other. Network Services include solutions designed to improve performance of websites, apps, application programming interfaces (“APIs”) and digital media. Security includes products designed to protect websites, apps, APIs and users. Other includes Compute solutions that allow developers to build and deploy modern web applications on Fastly's edge cloud platform, and Observability solutions that provide real-time logs, data and metrics streamed from Fastly's edge platform for actionable insights. The following table presents the Company’s revenue by product line:
Three months ended September 30,Nine months ended September 30,
2024202320242023
(in thousands)
Network Services
$107,431 $102,526 $317,585 $295,320 
Security26,184 23,345 76,152 67,082 
Other3,591 1,945 9,360 5,809 
Total revenue
$137,206 $127,816 $403,097 $368,211 
Contract balances
The timing of revenue recognition may differ from the timing of invoicing to customers. The Company has an unconditional right to consideration when it invoices its customers and records a receivable. The Company records a contract asset, or unbilled receivable, when revenue is recognized prior to invoicing. The Company records a contract liability, or deferred revenue, when a contract is billed in advance of revenue being recognized.
Deferred revenue pertains to amounts billed to customers for which revenue has not been recognized, which primarily consists of the unearned portions of billings for the Company’s security subscription services and the unearned portion of edge cloud platform usage. Amounts that have been invoiced for annual subscriptions, but not collected, are recorded in accounts receivable and in unearned revenue or in revenue depending on whether services have been delivered to the customer. The Company’s payment terms and conditions vary by contract type, and generally range from 30 to 90 days.
The following table presents the Company’s contract assets and contract liabilities as of September 30, 2024 and as of December 31, 2023:
As of September 30, 2024As of December 31, 2023
(in thousands)
Contract assets
$1,121 $621 
Contract liabilities$32,496 $38,150 
The following table presents revenue recognized during the three and nine months ended September 30, 2024 and 2023 from amounts included in the contract liability at the beginning of the period:
Three months ended September 30,Nine months ended September 30,
2024202320242023
(in thousands)
Revenue recognized in the period from amounts included in contract liability at the beginning of the period$14,748 $12,279 $30,149 $27,616 
Remaining performance obligations
As of September 30, 2024, the aggregate amount of the transaction price in our contracts allocated to remaining performance obligations that are unsatisfied or partially unsatisfied was $235.4 million. This amount includes future committed revenue for periods within current contracts with customers, as well as deferred revenue arising from consideration invoiced for which the related performance obligations have not been satisfied. The Company has elected to not provide certain information about its remaining performance obligations for service contracts with an original contract duration of one year or less. As of September 30, 2024, the Company expects to recognize approximately 77% of its remaining performance obligations over the next 12 months. The Company’s typical contractual term with its customers is one year, although terms may vary by contract.
Costs to obtain a contract
As of September 30, 2024 and December 31, 2023, the Company's costs to obtain contracts were as follows:
As of September 30, 2024As of December 31, 2023
(in thousands)
Deferred contract costs, net$53,842 $61,981 
During the three months ended September 30, 2024 and 2023, the Company recognized $4.8 million and $4.1 million of amortization related to deferred contract costs, respectively. During the nine months ended September 30, 2024 and 2023, the Company recognized $13.9 million and $11.3 million of amortization related to deferred contract costs, respectively. These costs are recorded within sales and marketing expenses on the accompanying condensed consolidated statements of operations.