Company: CXAI
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001829126-25-009077
Chunk: 16

Company: CXApp Inc.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 1
Chunk 16
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 of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had deferred revenue of approximately $1,573 thousand and $2,683 thousand as of September 30, 2025 and December 31, 2024, respectively, related to customer invoices rendered in advance for software licenses and professional services provided by the Company’s technical staff.

The
Company expects to satisfy its remaining performance obligations for the deferred revenue associated with professional services, and
recognize the deferred revenue related to licenses generally over the remaining contract term which is generally twelve months
following the commencement of the license. The Company recognized revenue in the reporting period of $547
thousand and $2,325
thousand, that was included in the contract liability balance at the beginning of the period, for the three and nine months ended
September 30, 2025 and $487
thousand and $2,359
thousand, that was included in the contract liability balance at the beginning of the period, for the three and nine months ended September 30,
2024, respectively.

Costs to Obtain a Contract

The Company recognizes eligible sales commissions as an asset within prepaid expenses and other current assets as the commissions are an incremental cost of obtaining a contract with the customer and the Company expects to recover these costs. The capitalized costs are amortized over the expected contract term.

    13

Cost to Fulfill a Contract

The Company incurs costs to fulfill their obligations under a contract once it has obtained the contract. These costs are generally not significant and are recorded to expense as incurred.

Multiple Performance Obligations

The Company enters into contracts with customers for its technology that include multiple performance obligations. Each distinct performance obligation was determined by whether the customer could benefit from the good or service on its own or together with readily available resources. The Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company’s process for determining standalone selling price considers multiple factors including the Company’s internal pricing model and market trends that may vary depending upon the facts and circumstances related to each performance obligation.

Sales and Use Taxes

The Company presents transactional taxes such as sales and use tax collected from customers and remitted to government authorities on a net basis.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred as part of cost of revenues. These costs were deemed to be de minimis during each of the reporting periods.

Research and Development

Research and development (“R&D”) costs are expensed when