Quarterly report pursuant to Section 13 or 15(d)

REVENUE RECOGNITION

v3.22.2.2
REVENUE RECOGNITION
 9 Months Ended
Sep. 30, 2022
Revenue Recognition  
REVENUE RECOGNITION

 

4. REVENUE RECOGNITION

 

The following is a summary of revenue by category (in thousands):

 

                               
    Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
    2022     2021     2022     2021  
Product sales   $ 34,621     $ 29,823     $ 109,394     $ 101,628  
Non-recurring engineering (“NRE”)     1,031       3,631       2,187       10,590  
Product maintenance contracts     961       1,421       2,770       6,047  
Professional service contracts     2,581       1,769       6,518       4,632  
Software licenses     1,556       2,122       4,102       3,470  
Other     344       157       632       539  
Total revenue   $ 41,094     $ 38,923     $ 125,603     $ 126,906  

 

There was $0.5 million recognized at a point in time for NRE services for the three and nine months ended September 30, 2022. Revenue recognized at a point in time for NRE services amounted to $1.5 million for the three months ended September 30, 2021 and $3.0 million for the nine months ended September 30, 2021. For services performed on a customer’s owned asset, since the customer controls the asset being enhanced, revenue is recognized over time as services are rendered. There was $0.5 million recognized over time for NRE services using a cost-based input method for the three months ended September 30, 2022. Revenue recognized over time for NRE services using a cost-based input method amounted to $2.2 million for the three months ended September 30, 2021, and $1.7 million and $7.6 million for the nine months ended September 30, 2022 and 2021, respectively. The Company is allowed to bill for services performed under the contract in the event the contract is terminated.

 

The opening and closing balances of our contract asset and liability balances from contracts with customers as of September 30, 2022 and December 31, 2021 were as follows (in thousands):

 

               
    Contracts
Assets		     Contracts
Liabilities		  
Balance as of December 31, 2021   $ 7,673     $ 2,902  
Balance as of September 30, 2022     8,235       3,553  
Change   $ 562     $ 651  

 

Remaining performance obligations represent the revenue that is expected to be recognized in future periods related to performance obligations included in a contract that are unsatisfied, or partially satisfied, as of the end of a period. As of September 30, 2022 and December 31, 2021, deferred revenue (both current and noncurrent) of $3.6 million and $2.9 million, respectively, represents the Company’s remaining performance obligations, of which $3.4 million and $2.5 million, respectively, is expected to be recognized within one year, with the remainder to be recognized thereafter.

 

Revenues for the three and nine months ended September 30, 2022 and 2021, include the following (in thousands):

 

                       
    Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
    2022     2021     2022     2021  
Amounts included in the beginning of year contract liability balance   $ 418     $ 626     $ 2,299     $ 5,053  

 

Warranty Liabilities

 

Information regarding the changes in the Company’s product warranty liabilities for the three and nine months ended September 30, 2022 and 2021 is as follows (in thousands):

 

                               
   

Three Months Ended

September 30,

    

Nine Months Ended

September 30,

  
    2022     2021     2022     2021  
Balance, beginning of period   $ 1,358     $ 1,099     $ 1,285     $ 1,019  
Accruals     216       236       1,383       496  
Settlements     (140 )     (139 )     (1,234 )     (319 )
Balance, end of period   $ 1,434     $ 1,196     $ 1,434     $ 1,196