Quarterly report pursuant to Section 13 or 15(d)

Revenue Recognition from Contracts with Customers

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Revenue Recognition from Contracts with Customers
3 Months Ended
Sep. 30, 2023
Revenue Recognition from Contracts with Customers [Abstract]  
Revenue Recognition from Contracts with Customers

Note 4. Revenue Recognition from Contracts with Customers

 

Disaggregation of Revenue

 

The Company’s primary revenue streams include fabrication services and product sales across multiple geographic regions, primarily the Americas, Asia and Europe.

 

Fabrication Services

 

Fabrication services revenue includes Non-Recurring Engineering (“NRE”) and backend packaging services. Under these contracts, products are delivered to the customer at the completion of the service which represents satisfaction of the performance obligation as well as transfer of title. Depending on language with regards to enforceable right to payment for performance completed to date, related revenue will either be recognized over time or at a point in time.

 

Product Sales

 

Product sales revenue consists of sales of RF filters which are sold with contract terms stating that title passes, and the customer takes control, at the time of shipment. Revenue is then recognized when the devices are shipped, and the performance obligation has been satisfied. If devices are sold under contract terms that specify that the customer does not take ownership until the goods are received, revenue is recognized when the customer receives the goods.

 

The following table summarizes the revenues of the Company’s reportable segments by geographic region for the three months ended September 30, 2023 (in thousands):

 

    Fabrication
Services
Revenue
    Product Sales
Revenue
    Total Revenue
with
Customers
 
Americas   $ 2,282     $ 716     $ 2,998  
Asia     269       3,045       3,314  
Europe     103       587       690  
Total   $ 2,654     $ 4,348     $ 7,002  

 

The following table summarizes the revenues of the Company’s reportable segments by geographic region for the three months ended September 30, 2022 (in thousands):

 

  Fabrication
Services
Revenue
    Product Sales
Revenue
    Total Revenue
with
Customers
 
Americas   $    706     $ 913     $ 1,619  
Asia     227       3,075       3,302  
Europe    
      635       635  
Other    
      10       10  
Total   $ 933     $ 4,633     $ 5,566  

 

Performance Obligations

 

The Company has determined that contracts for product sales revenue and fabrication services revenue involve one performance obligation, which is delivery of the final product.

 

Contract Balances

 

The following table summarizes the changes in the opening and closing balances of the Company’s contract asset (included in Other current assets on the Consolidated Balance Sheet) and contract liability (included as Deferred revenue on the Consolidated Balance Sheet) for the first three months of fiscal years 2024 and 2023 (in thousands):

 

    Contract
Assets
    Contract
Liability
 
Balance, June 30, 2023   $ 1,894     $ 105  
Closing, September 30, 2023     720       312  
Increase/(Decrease)   $ (1,174 )   $ 207  
                 
Balance, June 30, 2022   $ 923     $ 286  
Closing, September 30, 2022     1,661       147  
Increase/(Decrease)   $ 738     $ (139 )

 

The Company records a receivable when the title for goods has transferred. Generally, all sales are contract sales (with either an underlying contract or purchase order), resulting in all receivables being contract receivables. When invoicing occurs prior to revenue recognition a contract liability is recorded (as deferred revenue on the Condensed Consolidated Balance Sheets). The amount of revenue recognized in the three months ended September 30, 2023, that was included in the opening contract liability balance was $25 thousand which related to timing of shipments.

 

Contract assets are recorded when revenue recognized exceeds the amount invoiced. The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the timing difference between the Company’s performance and the customer’s payment. The amount of contract assets invoiced in the three months ended September 30, 2023, that was included in the opening contract asset balance was $1.5 million, which primarily related to non-recurring engineering services.

 

Backlog of Remaining Customer Performance Obligations

 

Revenue expected to be recognized and recorded as sales during the remainder of this fiscal year from the backlog of performance obligations that are unsatisfied (or partially unsatisfied) at September 30, 2023 was $2.4 million. The Company’s backlog may vary significantly each reporting period based on the timing of major new contract commitments. In addition, our customers have the right, under some infrequent circumstances, to terminate contracts or defer the timing of the Company's services and their payments to us.