Service providers do not recognize Cost of Goods Sold or Cost of Sales since they do not sell a physical product. Some service providers, however, recognize an account called Cost of Revenue.

Cost of Revenue includes all costs incurred to produce revenue. This is a general definition, and Cost of Revenue differs on a company-by-company basis. Netflix, for example, includes amortization costs for its streaming content (both produced and licensed) in its Cost of Revenue, whereas Snapchat, Twitter, and Facebook include data infrastructure costs (web hosting, data center costs, depreciation of servers) in their Cost of Revenue.