Company: IIIV
Filing Date: 2025-02-07
Form Type: 10-Q
Source: 0001728688-25-000043
Chunk: 134

Company: i3 Verticals, Inc.
Filing Date: 2025-02-07
Form: 10-Q
Item: Part I, Item 8
Chunk 134
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723 and $8,680, respectively.Contract LiabilitiesDeferred revenue represents amounts billed to customers by the Company for services contracts. Payment is typically collected at the start of the contract term. The initial prepaid contract agreement balance is deferred. The balance is then recognized as the services are provided over the contract term. Deferred revenue that is expected to be recognized as revenue within one year is recorded as short-term deferred revenue and the remaining portion is recorded as other long-term liabilities in the condensed consolidated balance sheets. The terms for most of the Company's contracts with a deferred revenue component are one year. Substantially all of the Company's deferred revenue is anticipated to be recognized within the next year.The following tables present the changes in deferred revenue as of and for the three months ended December 31, 2024 and 2023, respectively:Balance at September 30, 2024$39,824 Deferral of revenue17,264 Recognition of unearned revenue(14,150)Balance at December 31, 2024$42,938 Balance at September 30, 2023$32,985 Deferral of revenue19,156 Recognition of unearned revenue(14,681)Balance at December 31, 2023$37,460 Costs to Obtain and Fulfill a ContractThe Company capitalizes incremental costs to obtain new contracts and contract renewals and amortizes these costs on a straight-line basis as an expense over the benefit period, which is generally the expected customer life, unless a commensurate payment is not expected at renewal. As of December 31, 2024 and September 30, 2024, the Company had $936 and $857, respectively, of capitalized contract costs, which relates to commissions paid to employees and agents as well as other incentives given to customers to obtain new sales, 

18

i3 VERTICALS, Inc.NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)(in thousands, except unit, share and per share amounts)

included within “Other assets" on the condensed consolidated balance sheets. The Company recorded expense from continuing operations related to these costs of $31 for the three months ended December 31, 2024 and $18 for the three months ended December 31, 2023. The Company expenses sales commissions as incurred for the Company's sales commission plans that are paid on recurring monthly revenues, portfolios of existing customers, or have a substantive stay requirement prior to payment