v3.24.2
Revenue and Revenue-Related Activity
 6 Months Ended
Jun. 30, 2024
Revenue from Contract with Customer [Abstract]  
Revenue and Revenue-Related Activity

12. Revenue and Revenue-Related Activity

Disaggregation of Revenue

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

 

 

(In millions)

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Recurring revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Dayforce recurring

 

$

321.6

 

 

$

268.2

 

 

$

658.8

 

 

$

539.4

 

Powerpay recurring

 

 

24.6

 

 

 

24.1

 

 

 

50.6

 

 

 

48.2

 

Total Cloud recurring

 

 

346.2

 

 

 

292.3

 

 

 

709.4

 

 

 

587.6

 

Other recurring

 

 

18.8

 

 

 

22.6

 

 

 

38.3

 

 

 

45.2

 

Total recurring revenue

 

 

365.0

 

 

 

314.9

 

 

 

747.7

 

 

 

632.8

 

Professional services and other

 

 

58.3

 

 

 

51.0

 

 

 

107.1

 

 

 

103.7

 

Total revenue

 

$

423.3

 

 

$

365.9

 

 

$

854.8

 

 

$

736.5

 

Recurring revenue includes float revenue of $48.9 million and $41.8 million for the three months ended June 30, 2024, and 2023, respectively, and $109.6 million and $88.7 million for the six months ended June 30, 2024, and 2023, respectively.

Contract Balances

In accordance with Accounting Standards Codification ("ASC") 606, a contract asset is generally recorded when revenue recognized for professional service performance obligations exceed the contractual amount of billings for implementation related professional services. Additions to contract assets generally represent increases to professional services revenues, and reductions to contract assets generally represent reductions to recurring revenues during the initial contract term. Contract assets expected to be recognized in revenue within twelve months are included within prepaid expenses and other current assets, with the remaining contract assets included within other assets on our condensed consolidated balance sheets. The changes in total contract assets were as follows:

 

 

 

Six Months Ended June 30,

 

 

 

2024

 

 

2023

 

 

 

(In millions)

 

Contract assets, beginning of period

 

$

89.0

 

 

$

68.5

 

Additions

 

 

46.0

 

 

 

46.9

 

Reductions

 

 

(41.4

)

 

 

(40.1

)

Foreign currency translation

 

 

(0.6

)

 

 

0.5

 

Contract assets, end of period

 

$

93.0

 

 

$

75.8

 

Deferred Revenue

Deferred revenue primarily consists of payments received in advance of revenue recognition. The changes in deferred revenue were as follows:

 

 

 

Six Months Ended June 30,

 

 

 

2024

 

 

2023

 

 

 

(In millions)

 

Deferred revenue, beginning of period

 

$

40.2

 

 

$

41.2

 

New billings

 

 

493.9

 

 

 

351.4

 

Acquired billings

 

 

8.6

 

 

 

—

 

Revenue recognized

 

 

(495.6

)

 

 

(333.4

)

Foreign currency translation

 

 

(0.6

)

 

 

(15.7

)

Deferred revenue, end of period

 

$

46.5

 

 

$

43.5

 

 

Deferred Sales Commissions

In accordance with ASC 606, sales commissions paid based on the annual contract value of a signed customer contract are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions paid based on the annual contract value are deferred and then amortized on a straight-line basis over a period of benefit that we have determined to be ten years. Amortization expense for deferred sales commissions was $6.6 million and $5.0 million for the three months ended June 30, 2024, and 2023, respectively, and $12.9 million and $9.7 million for the six months ended June 30, 2024, and 2023, respectively.

Transaction Price for Remaining Performance Obligations

As of June 30, 2024, approximately $1,254.9 million of revenue is expected to be recognized over the next three years from remaining performance obligations, which represents contracted revenue for recurring services and fixed price professional services, primarily implementation services, that has not yet been recognized, including deferred revenue and unbilled amounts that will be recognized as revenue in future periods. Performance obligations that are billed and recognized as they are delivered, primarily professional services contracts that are on a time and materials basis, are excluded from the transaction price for remaining performance obligations disclosed above.