Company: NTWK
Filing Date: 2025-09-29
Form Type: 10-K
Source: 0001493152-25-015950
Chunk: 106

Company: NETSOL TECHNOLOGIES INC
Filing Date: 2025-09-29
Form: 10-K
Item: Item 1
Chunk 106
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 training, gaps development and any other additional
third-party interfaces. Even after implementation, customers regularly seek enhancements and additions to improve their business processes
and have changing requirements addressed at mutually agreed rates.

Post
implementation, our consultants may remain at the client site to assist the customer with smooth operations. After this phase, the regular
maintenance and support services phase for the implemented technology begins in exchange for agreed subscriptions or support fees. In
addition to the daily rate paid by the customer for each consultant engaged, the customer also pays for all visa and transportation-related
expenses, boarding of the consultants and a living allowance. Our involvement in all the above steps is suitably priced to bring value
to our customers and increase our profitability.

Cloud-enabled
solutions are offered via seamless and rapid deployments. The swift speed of implementation for our cloud-ready products enables businesses
to be more responsive and attain a competitive advantage. For example, certain API-first, SaaS products of ours via TranscendTM
Marketplace can be integrated into a customer’s ecosystem within mere minutes.

PRICING
AND REVENUE STREAMS

Our
revenue streams are the outcome of the following four main areas:

  ■
  Product licensing

  ■
  Subscription-based pricing

  ■
  Implementation and customization-related
  services

  ■
  Post implementation, support-related
  services

License
fees can range up to a multi-million-dollar fee for single or multiple module implementations. License revenue is realized with traditional,
non-SaaS-based agreements, whereas SaaS-based agreements do not contain license fees and are offered via flexible, value-driven, subscription-based
pricing. There are various attributes which determine the level of pricing complexity, a few of which are: number of contracts, size
of the portfolio, IT budgets, business strategy of the customer, internal business processes followed by the customer, number of business
users, amount of customization required, the complexity of data migration and branch network of the customer.

We
recognize revenue from license contracts when the software has been delivered to the customer. Implementation-related services, including
customization, configuration, data migration, training and third-party interfaces are recognized as the services are performed. Post-implementation
support services are then provided on a continued basis. The annual support fee, typically an agreed upon percentage of overall monetary
value of the license, then becomes an ongoing revenue stream realized yearly. Revenue from software services includes fixed price and
time, and materials-based contracts and is recognized as