Annual Report 2025

6 Revenue

Revenue from contracts with customers comprises revenue from the sale of software and cloud licenses as well as the sale of technology consulting services. Revenue from contracts with customers is recognized when the performance obligation in the contract has been satisfied either at a “point in time” or “over time” as control of the promised goods or service is transferred to the customer at an amount that reflects the consideration to which the group expects to be entitled in exchange for those goods or services. The normal credit term is 30 to 90 days upon delivery.

Software & Cloud Direct

SoftwareOne enters into contracts with end customers to sell software and cloud solutions of several third-party software providers. Below, software is used as a synonym for software and cloud products.

SoftwareOne acts as a “value added software reseller”, providing pre-sales consulting services to end customers in connection with software sales. The group's performance obligation is to arrange for the provision of software between the software provider and the end customer. Primary responsibility to provide the software lies with the software provider. SoftwareOne invoices the end customer and manages payment collections. SoftwareOne's performance obligation is satisfied when all parties have concluded the license agreement, and the software provider has accepted the contract and associated terms and conditions. The same applies for multi-period cloud consumption-based contracts with minimum commitments. Thus, SoftwareOne acts as an agent and recognizes revenue in the net amount in the consolidated financial statements, reflecting the difference between the consideration received from the end customer and the cost of software purchased.

The group also enters into multi-year licensing contracts with annual billing in which the end customer has the right to change the software reseller during the contract term. For such contracts, SoftwareOne recognizes revenue for the contract between the end customer and the software provider upfront for the entire term when all parties have concluded the contract, adjusting for the effects of a potential change in channel partner based on historical experience as a variable consideration, and presented net as contract asset.

SoftwareOne uses the practical expedient in IFRS 15 and does not adjust the promised amount of consideration for the effects of a significant financing component if it expects at contract inception that the period between the provision of access to the software license to the end customer and the receipt of the consideration from the end customer will be one year or less.

Software & Cloud Services

Revenue from technology consulting services is generally recognized over time as the customer simultaneously receives and consumes the benefits provided. SoftwareOne uses an input method based on costs incurred to measure progress towards the stage of completion of the service. The group has chosen this method of measuring progress because there is a direct relationship between SoftwareOne’s effort and the transfer of the service to the customer. In addition, in cases where the group provides standardized services (i.e., managed services), revenue is recognized pro rata over the term of the contract. Payment is due 30 days after the solutions and services have been performed. As a rule, services are priced separately. If this is not the case, the transaction prices are allocated based on the relative stand-alone selling prices.

For service contracts in which the company only acts as an agent between the customer and the third-party service provider, revenue is recognized on a net basis in the consolidated financial statements, reflecting the difference between the consideration received from the customer and the third-party service delivery cost. Revenue is recognized at the point in time when the underlying service has been delivered to the end customer.

Revenue from external software which is only used to provide software asset management solutions is recognized at the point in time when control of the license is transferred to the customer. Related costs of software purchased are presented net under revenue from Software & Cloud Services.

Software & Cloud Channel

Software & Cloud Channel represents the sale of software and cloud licenses to or through partners such as hosters, MSPs and ISVs who have the direct relationship with end customers. SoftwareOne invoices the partner who then invoices the end customer. SoftwareOne's performance obligation is satisfied when the partner and the software provider have concluded the license agreement, and the software provider has accepted the contract and associated terms and conditions. Revenue recognition follows the principles previously described in Software & Cloud Direct for the sale of software and cloud licenses.

Transaction price of unsatisfied performance obligations

SoftwareOne uses the practical expedient in IFRS 15.121 and does not disclose information about the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied when the original expected duration of the underlying contract is one year or less. After applying this practical expedient, the remaining performance obligations to be disclosed for the years ending December 31, 2025, and 2024 are not material.

Breakdown of revenue

By business lines

Revenue is allocated according to the business lines, as outlined below:

By geographical areas

For management purposes, SoftwareOne is organized by geographical areas. The breakdown of revenue below follows the regional clusters that constitute the group’s reportable segments. Revenue is disaggregated as outlined below: