v3.20.2
Revenue
9 Months Ended
Oct. 31, 2020
Revenue from Contract with Customer [Abstract]  
Revenue Revenue
The majority of the Company's revenue is generated from sales of the Company’s products. The following table summarizes net revenue disaggregated by product group (in thousands, except percentages):
Three Months EndedNine Months Ended
October 31,
2020
% of TotalNovember 2,
2019
% of TotalOctober 31,
2020
% of TotalNovember 2,
2019
% of Total
Net revenue by product group:
Networking (1)$444,756 59 %$329,962 50 %$1,244,684 57 %$1,000,911 51 %
Storage (2)276,279 37 %287,708 43 %825,462 38 %841,280 42 %
Other (3)29,108 %44,800 %100,935 %139,299 %
$750,143 $662,470 $2,171,081 $1,981,490 
(1) Networking products are comprised primarily of Ethernet Solutions, Embedded Processors and Custom ASICs.
(2) Storage products are comprised primarily of Storage Controllers and Fibre Channel Adapters.
(3) Other products are comprised primarily of Printer Solutions.
The following table summarizes net revenue disaggregated by primary geographical market based on destination of shipment (in thousands, except percentages):

Three Months EndedNine Months Ended
October 31,
2020
% of TotalNovember 2,
2019
% of TotalOctober 31,
2020
% of TotalNovember 2,
2019
% of Total
Net revenue based on destination of shipment:
China$324,927 43 %$258,028 39 %$908,255 42 %$790,473 40 %
United States73,751 10 %61,772 %241,814 11 %190,357 10 %
Malaysia73,582 10 %53,551 %198,436 %152,890 %
Thailand55,617 %59,112 %183,625 %169,289 %
Philippines44,356 %51,710 %118,485 %174,484 %
Japan32,811 %41,149 %104,676 %121,239 %
Other145,099 20 %137,148 21 %415,790 20 %382,758 18 %
$750,143 $662,470 $2,171,081 $1,981,490 

These destinations of shipment are not necessarily indicative of the geographic location of the Company's end customers or the country in which the Company's end customers sell devices containing the Company's products. For example, a substantial majority of the shipments made to China relate to sales to non-China based customers that have factories or contract manufacturing operations located within China.

The following table summarizes net revenue disaggregated by customer type (in thousands, except percentages):

Three Months EndedNine Months Ended
October 31,
2020
% of TotalNovember 2,
2019
% of TotalOctober 31,
2020
% of TotalNovember 2,
2019
% of Total
Net revenue by customer type:
Direct customers$573,759 76 %$476,253 72 %$1,646,511 76 %$1,475,554 74 %
Distributors176,384 24 %186,217 28 %524,570 24 %505,936 26 %
$750,143 $662,470 $2,171,081 $1,981,490 

Contract Liabilities

Contract liabilities consist of the Company’s obligation to transfer goods or services to a customer for which the Company has received consideration or the amount is due from the customer. As of October 31, 2020, contract liability balances are comprised of variable consideration estimated based on a portfolio basis using the expected value methodology based on analysis of historical data, current economic conditions, and contractual terms. Variable consideration estimates consist of the estimated returns, price discounts, price protection, rebates, and stock rotation programs. As of the end of a reporting period, some of the performance obligations associated with contracts will have been unsatisfied or only partially satisfied. In accordance with the practical expedients available in the guidance, the Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected duration of one year or less. Contract liabilities are included in accrued liabilities in the unaudited condensed consolidated balance sheets.

The opening balance of contract liabilities at the beginning of the first quarter of fiscal year 2021 was $111.5 million. During the nine months ended October 31, 2020, contract liabilities increased by $617.7 million associated with variable consideration estimates, offset by $596.3 million decrease in such reserves primarily due to credit memos issued to customers. The ending balance of contract liabilities as of the third quarter of fiscal year 2021 was $132.9 million. The amount of revenue recognized during the nine months ended October 31, 2020 that was included in the contract liabilities balance at February 1, 2020 was not material.
Sales Commissions

The Company has elected to apply the practical expedient to expense commissions when incurred as the amortization period is typically one year or less. These costs are recorded in selling, general and administrative expenses in the unaudited condensed consolidated statements of operations.