Company: NCNO
Filing Date: 2025-04-01
Form Type: 10-K
Source: 0001902733-25-000026
Chunk: 12

Company: nCino, Inc.
Filing Date: 2025-04-01
Form: 10-K
Item: Item 8
Chunk 12
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OLIDATED FINANCIAL STATEMENTS(In thousands, except share and per share amounts and unless otherwise indicated)

The Company determines revenue recognition through the following steps:•Identification of the contract, or contracts, with a customer;•Identification of the performance obligations in the contract; •Determination of the transaction price;•Allocation of the transaction price to the performance obligations in the contract; and•Recognition of revenues when, or as, the Company satisfies a performance obligation.Subscription RevenuesSubscription revenues primarily consist of fees for providing customers access to the Company’s solutions, with routine customer support and maintenance related to email and phone support, bug fixes, and unspecified software updates, and upgrades released when and if available during the maintenance term. Revenues are generally recognized on a ratable basis over the contract term beginning on the date that the Company’s service is made available to the customer, which the Company believes best reflects the manner in which the Company’s customers utilize the Company’s subscription offerings. Arrangements with customers do not provide the customer with the right to take possession of the software supporting the Company's solutions at any time and, as a result, are accounted for as a service contract. Generally, the Company’s subscription contracts are three to five years in length, billed annually in advance, are non-cancelable, and do not contain refund-type provisions. U.S. mortgage contracts are generally billed monthly in advance. Subscription arrangements that are cancelable generally have penalty clauses.Professional Services and Other RevenuesProfessional services revenues primarily consist of fees for deployment, configuration, and optimization services, as well as training. The majority of the Company’s professional services contract revenues are recognized over time based on a proportional performance methodology which utilizes input methods. The Company’s professional services contracts are billed on a time and materials or fixed fee basis.Contracts with Multiple Performance ObligationsMost of the Company’s contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis. The Company determines SSP by considering its overall pricing objectives and market conditions. Significant pricing practices taken into consideration include the Company’s discounting practices, the size and volume of the Company’s transactions, the customer demographic, the geographic area where services are sold, price lists, the Company’s go-to-market strategy, historical sales, and contract prices. As the Company’s go-to-market strategies evolve, the Company may modify its pricing practices in the future, which