Company: CXDO
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001654954-25-005149
Chunk: 70

Company: Crexendo, Inc.
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 2
Chunk 70
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Cloud telecommunications service revenue consists primarily of fees collected for cloud telecommunications services, professional services, interest from sales-type leases, reselling broadband Internet services, managed IT service, and administrative fees.  The following table reflects our service revenue for the three months ended March 31, 2025, compared to the three months ended March 31, 2024:

  Three Months Ended March 31,   2025  2024  DollarChange  PercentChange Service revenue $8,182  $7,845  $337   4%

The increase in service revenue is due to an increase in telecommunications services fees of $306, an increase in fees, commissions, and other, recognized over time of $98, and an increase in sales-type lease interest of $46, offset by a decrease in one-time fees, commissions and other of $113. A substantial portion of Cloud Telecommunications service revenue is generated through thirty-six to sixty month service contracts. 

Product Revenue

Product revenue consists primarily of fees collected from the sale of desktop phone devices, third-party equipment, and device as a service. The following table reflects our product revenue for the three months ended March 31, 2025, compared to the three months ended March 31, 2024:

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  Three Months Ended March 31,   2025  2024  DollarChange  PercentChange Product revenue $1,007  $1,295  $(288)  (22)%

Product revenue fluctuates from one period to the next based on timing of installations. Our typical customer installation is complete within 30-60 days. However, larger enterprise customers can take multiple months, depending on size and the number of locations. Product revenue is recognized when products have been installed and services commence. Additionally, product revenue can fluctuate due to the allocation of discounts or sales promotions across the performance obligations.

Remaining Performance Obligations

Remaining Performance Obligations (RPOs) represents the total contract value of all contracts signed, less revenue recognized from those contracts as of March 31, 2025 and 2024. RPO’s increased 14%, or $6,602 to $54,683 as of March 31, 2025 as compared to $48,082 as of March 31, 2024. Below is a table which displays the Cloud Telecommunications segment remaining performance obligations as of