(3) Revenue from Contracts with Customers
Disaggregated Revenue by geographic location:
Revenues by geographic area presented based upon the location of the customer are as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Year Ended December 31, |
| | | | | | 2025 | | 2024 | | 2023 |
| United States | | | | | | $ | 612,225 | | | $ | 614,085 | | | $ | 579,025 | |
| Rest of world | | | | | | 247,569 | | | 229,922 | | | 198,682 | |
| Total | | | | | | $ | 859,794 | | | $ | 844,007 | | | $ | 777,707 | |
Transaction Price Allocated to the Remaining Performance Obligations
The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied as of December 31, 2025 (in thousands). The estimated revenues do not include unexercised contract renewals.
| | | | | | | | | | | | | | |
| | Next Twelve Months | | Thereafter |
| Product subscriptions | | $ | 565,859 | | | $ | 270,397 | |
| Professional services | | 13,105 | | | 4,665 | |
| Total | | $ | 578,964 | | | $ | 275,062 | |
Deferred contract acquisition and fulfillment costs
The following table summarizes the activity of the deferred contract acquisition and fulfillment costs, which primarily consist of capitalized sales commissions, for the year ended December 31, 2025 and 2024 (in thousands):
| | | | | | | | | | | | | | |
| | Year Ended December 31, |
| | 2025 | | 2024 |
| Beginning balance | | $ | 125,806 | | | $ | 121,609 | |
| Capitalization of contract acquisition and fulfillment costs | | 47,334 | | | 57,796 | |
| Amortization of deferred contract acquisition and fulfillment costs | | (57,792) | | | (53,599) | |
| Ending balance | | $ | 115,348 | | | $ | 125,806 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.