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Revenue Recognition | 6 Months Ended
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Jun. 30, 2021
Revenue from Contract with Customer [Abstract] |
Revenue Recognition | The majority of our revenue is generated from monthly service revenues, which is inclusive of our platform usage pricing model, and related professional services from the sale of our services. Revenues are recognized when control of these services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. No single customer accounted for 10% or more of our total revenue for the six months ended June 30, 2021. Remaining Performance Obligation As of June 30, 2021, the aggregate amount of the total transaction price allocated in contracts with original duration of greater than one year to the remaining performance obligations was $345.8 million. Approximately 92% of our remaining performance obligations is expected to be recognized during the next 24 months, with the balance recognized thereafter. The aggregate balance of unsatisfied performance obligations represents contracted revenue that has not yet been recognized, and does not include contract amounts that are cancellable by the customer, amounts associated with optional renewal periods, and any amounts related to performance obligations, which are billed and recognized as they are delivered. Deferred Revenues We record deferred revenues when cash payments are received or due in advance of our performance. The increase in the deferred revenue balance as of June 30, 2021 is primarily driven by cash payments received or due in advance of our performance obligations, partially offset by $81.9 million of revenues recognized that were included in the deferred revenue balance as of December 31, 2020. The following table presents deferred revenue by revenue source:
| Deferred Revenue
| June 30, 2021 |  | December 31, 2020
| (In thousands)
Hosted services – Business | $ | 105,239 |  |  | $ | 86,144 |
Hosted services – Consumer | 889 |  |  | 835 |
Professional services – Business | 1,543 |  |  | 1,869 |
Total deferred revenue - short term | $ | 107,671 |  |  | $ | 88,848 |
Professional services – Business | 489 |  |  | 409 |
Total deferred revenue - long term | $ | 489 |  |  | $ | 409 |
Disaggregated Revenue The following table presents the Company’s revenues disaggregated by revenue source:
| Three Months Ended |  | Six Months Ended
| June 30, |  | June 30,
| 2021 |  | 2020 |  | 2021 |  | 2020
| (In thousands)
Revenue: |  |  |  |  |  |  |
Hosted services – Business | $ | 95,092 |  |  | $ | 72,382 |  |  | $ | 178,732 |  |  | $ | 133,435 |
Hosted services – Consumer | 9,810 |  |  | 7,587 |  |  | 18,821 |  |  | 13,826 |
Professional services – Business | 14,703 |  |  | 11,634 |  |  | 29,943 |  |  | 22,430 |
Total revenue | $ | 119,605 |  |  | $ | 91,603 |  |  | $ | 227,496 |  |  | $ | 169,691 |
Revenue by Geographic Location The following table presents the Company’s revenues attributable to domestic and foreign operations for the periods presented:
| Three Months Ended June 30, |  | Six Months Ended
| June 30, |  | June 30,
| 2021 |  | 2020 |  | 2021 |  | 2020
| (In thousands)
United States | $ | 80,924 |  |  | $ | 59,559 |  |  | $ | 149,706 |  |  | $ | 108,109 |
Other Americas (1) | 3,995 |  |  | 3,048 |  |  | 7,908 |  |  | 5,068 |
Total Americas | 84,919 |  |  | 62,607 |  |  | 157,614 |  |  | 113,177 |
EMEA (2) (4) | 22,933 |  |  | 19,692 |  |  | 44,693 |  |  | 39,182 |
APAC (3) | 11,753 |  |  | 9,304 |  |  | 25,189 |  |  | 17,332 |
Total revenue | $ | 119,605 |  |  | $ | 91,603 |  |  | $ | 227,496 |  |  | $ | 169,691 |
—————————————— (1)Canada, Latin America and South America (2)Europe, the Middle East and Africa (“EMEA”) (3)Asia-Pacific (“APAC”) (4)Includes revenues from the United Kingdom of $14.8 million and $12.5 million for the three months ended June 30, 2021 and 2020, respectively, and from the Netherlands of $1.2 million and $0.6 million for the three months ended June 30, 2021 and 2020, respectively. Includes revenues from the United Kingdom of $28.1 million and $25.1 million for the six months ended June 30, 2021 and 2020, respectively, and from the Netherlands of $2.5 million and $1.9 million for the six months ended June 30, 2021 and 2020, respectively. Information about Contract Balances Amounts collected in advance of services being provided are accounted for as deferred revenue. Nearly all of our deferred revenue balance is related to Hosted Services - Business Revenue. In some arrangements, we allow customers to pay for access to the Conversational Cloud over the term of the software license. We refer to these as subscription transactions. Amounts recognized as revenue in excess of amounts billed are recorded as unbilled receivables. Unbilled receivables, anticipated to be invoiced in the next twelve months, are included in accounts receivable on the condensed consolidated balance sheet. Contract acquisition costs represent prepaid sales commissions. The opening and closing balances of our accounts receivable, unbilled receivables, contract acquisition costs, and deferred revenues are as follows:
| Accounts Receivable |  | Unbilled Receivable |  | Contract Acquisition Costs (Non-current) |  | Deferred Revenue (Current) |  | Deferred Revenue (Non-current) |  |  |  |  |
| (In thousands)
Opening balance as of December 31, 2020 | $ | 61,801 |  |  | $ | 18,622 |  |  | $ | 41,021 |  |  | $ | 88,848 |  |  | $ | 409 |  |  |  |  |  |
(Decrease) increase, net | (2,936) |  |  | 12,320 |  |  | 2,441 |  |  | 18,823 |  |  | 80 |  |  |  |  |  |
Ending balance as of June 30, 2021 | $ | 58,865 |  |  | $ | 30,942 |  |  | $ | 43,462 |  |  | $ | 107,671 |  |  | $ | 489 |  |  |  |  |  |
Accounts Receivable, Net Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on historical write-off experience. The Company reviews its allowance for doubtful accounts monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. All other balances are reviewed on a pooled basis. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Accounts receivable are written off against the allowance for uncollectible accounts when we determine amounts are no longer collectible.
| Allowance for Doubtful Accounts
| (In thousands)
Balance as of December 31, 2020 | $ | 5,344 |
Additions charged to costs and expenses | 1,599 |
Deductions/write-offs | (1,106) |
Balance as of June 30, 2021 | $ | 5,837 |

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 13 -Subparagraph (b)(2) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 + Details
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