Revenues and Cost of Revenues
|12 Months Ended|
Dec. 31, 2022
|Revenue from Contract with Customer [Abstract]|
|Revenues and Cost of Revenues||Revenues and Cost of Revenues
Disaggregation of Revenue
The following table presents the Company’s revenues disaggregated by major source:
One customer accounted for more than 10% of the Company’s total revenues, substantially all of which are included within the Envestnet Wealth Solutions segment:
The following table presents the Company’s revenues disaggregated by geography, based on the billing address of the customer:
(1) No foreign country accounted for more than 10% of total revenues.
Remaining Performance Obligations
As of December 31, 2022, the Company's estimated revenue expected to be recognized in the future related to performance obligations associated with existing customer contracts that are partially or wholly unsatisfied is approximately $544.6 million. We expect to recognize approximately 43% of this revenue in 2023, approximately 42% throughout 2024 and 2025, with the balance recognized thereafter. These remaining performance obligations are not indicative of revenue for future periods.
Total deferred revenue increased $4.9 million for the year ended December 31, 2022 and decreased $2.0 million for the year ended December 31, 2021. These fluctuations are primarily due to timing differences related to the satisfaction of outstanding performance obligations and the Company's billing cycles during the years then ended. The majority of the Company's deferred revenue as of December 31, 2022 will be recognized over the course of the next twelve months.
The amount of revenue recognized that was included in the opening deferred revenue balance was $33.1 million and $33.8 million for the years ended December 31, 2022 and 2021, respectively. The majority of this revenue consists of subscription-based services and professional services arrangements. The amount of revenue recognized from performance obligations satisfied in prior periods was not material.
Deferred Sales Incentive Compensation
Deferred sales incentive compensation was $11.0 million and $11.8 million as of December 31, 2022 and 2021, respectively. Amortization expense for the deferred sales incentive compensation was $4.3 million and $4.4 million for the years ended December 31, 2022 and 2021, respectively. Deferred sales incentive compensation is included in other non-current assets on the consolidated balance sheets and amortization expense is included in compensation and benefits expenses on the consolidated statements of operations. No significant impairment loss for capitalized costs was recorded during the periods.
Cost of Revenues
The following table summarizes cost of revenues by revenue category:
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.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef