Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers

Disaggregation of Revenue

The Company operates in two business segments: High Performance Materials & Components (HPMC) and Advanced Alloys & Solutions (AA&S). Revenue is disaggregated within these two business segments by diversified global markets, primary geographical markets and diversified products. Comparative information of the Company’s overall revenues (in millions) by global and geographical markets for the second quarters and six months ended June 30, 2021 and 2020 were as follows:

(in millions)	Second quarter ended
	June 30, 2021						June 30, 2020
	HPMC		AA&S		Total		HPMC		AA&S		Total
Diversified Global Markets:
Aerospace & Defense	$	218.6	$	62.6	$	281.2	$	252.3	$	113.3	$	365.6
Energy*	48.6		69.7		118.3		22.8		144.7		167.5
Automotive	1.4		66.6		68.0		1.0		49.8		50.8
Electronics	0.2		43.1		43.3		0.2		39.3		39.5
Medical	14.6		17.4		32.0		10.3		19.6		29.9
Construction/Mining	6.1		15.8		21.9		5.0		29.8		34.8
Food Equipment & Appliances	0.1		20.6		20.7		0.1		47.1		47.2
Other	11.0		19.8		30.8		9.0		26.0		35.0
Total	$	300.6	$	315.6	$	616.2	$	300.7	$	469.6	$	770.3

(in millions)	Six months ended
	June 30, 2021						June 30, 2020
	HPMC		AA&S		Total		HPMC		AA&S		Total
Diversified Global Markets:
Aerospace & Defense	$	398.4	$	137.0	$	535.4	$	611.1	$	247.0	$	858.1
Energy*	79.1		188.3		267.4		46.9		291.2		338.1
Automotive	3.4		156.1		159.5		3.0		124.3		127.3
Electronics	0.5		98.4		98.9		0.5		72.2		72.7
Construction/Mining	11.2		53.2		64.4		10.3		68.1		78.4
Medical	25.8		35.2		61.0		27.3		41.2		68.5
Food Equipment & Appliances	0.1		56.0		56.1		0.1		97.5		97.6
Other	23.0		43.0		66.0		21.8		63.3		85.1
Total	$	541.5	$	767.2	$	1,308.7	$	721.0	$	1,004.8	$	1,725.8

*Includes the oil & gas, downstream processing, and specialty energy markets.

(in millions)	Second quarter ended
	June 30, 2021						June 30, 2020
	HPMC		AA&S		Total		HPMC		AA&S		Total
Primary Geographical Market:
United States	$	157.6	$	172.1	$	329.7	$	166.2	$	311.0	$	477.2
Asia	40.6		94.7		135.3		27.6		91.1		118.7
Europe	86.3		27.1		113.4		92.0		32.4		124.4
Canada	9.3		10.7		20.0		5.1		11.1		16.2
South America, Middle East and other	6.8		11.0		17.8		9.8		24.0		33.8
Total	$	300.6	$	315.6	$	616.2	$	300.7	$	469.6	$	770.3

(in millions)	Six months ended
	June 30, 2021						June 30, 2020
	HPMC		AA&S		Total		HPMC		AA&S		Total
Primary Geographical Market:
United States	$	285.9	$	443.7	$	729.6	$	393.5	$	689.8	$	1,083.3
Asia	60.7		217.3		278.0		52.7		185.3		238.0
Europe	165.4		61.1		226.5		225.5		70.0		295.5
Canada	17.5		19.8		37.3		16.7		21.5		38.2
South America, Middle East and other	12.0		25.3		37.3		32.6		38.2		70.8
Total	$	541.5	$	767.2	$	1,308.7	$	721.0	$	1,004.8	$	1,725.8

Comparative information of the Company’s major high-value and standard products based on their percentages of sales is included in the following table. In conjunction with the Company’s announced ongoing exit of standard stainless sheet products, in the fourth quarter of 2020 ATI reclassified certain items as High-Value Products within AA&S segment results. Prior period information reflects these reclassifications. Hot-Rolling and Processing Facility conversion service sales in the AA&S segment are excluded from this presentation.

	Second quarter ended
	June 30, 2021						June 30, 2020
	HPMC		AA&S		Total		HPMC		AA&S		Total
Diversified Products and Services:
High-Value Products
Nickel-based alloys and specialty alloys	45	%	21	%	33	%	36	%	32	%	34	%
Precision rolled strip products	—	%	39	%	19	%	—	%	20	%	12	%
Precision forgings, castings and components	36	%	—	%	18	%	35	%	—	%	14	%
Titanium and titanium-based alloys	19	%	6	%	13	%	29	%	13	%	19	%
Zirconium and related alloys	—	%	24	%	12	%	—	%	14	%	8	%
Total High-Value Products	100	%	90	%	95	%	100	%	79	%	87	%
Standard Products
Standard stainless products	—	%	10	%	5	%	—	%	21	%	13	%
Total	100	%	100	%	100	%	100	%	100	%	100	%

	Six months ended
	June 30, 2021						June 30, 2020
	HPMC		AA&S		Total		HPMC		AA&S		Total
Diversified Products and Services:
High-Value Products
Nickel-based alloys and specialty alloys	41	%	25	%	32	%	38	%	28	%	34	%
Precision rolled strip products	—	%	35	%	20	%	—	%	18	%	12	%
Precision forgings, castings and components	39	%	—	%	17	%	35	%	—	%	15	%
Titanium and titanium-based alloys	20	%	6	%	12	%	27	%	10	%	18	%
Zirconium and related alloys	—	%	19	%	10	%	—	%	12	%	8	%
Total High-Value Products	100	%	85	%	91	%	100	%	68	%	87	%
Standard Products
Standard stainless products	—	%	15	%	9	%	—	%	32	%	13	%
Total	100	%	100	%	100	%	100	%	100	%	100	%

The Company maintained a backlog of confirmed orders totaling $1.6 billion and $1.5 billion at June 30, 2021 and 2020, respectively. Due to the structure of the Company’s long-term agreements, approximately 75% of this backlog at June 30, 2021 represented booked orders with performance obligations that will be satisfied within the next 12 months. The backlog does not reflect any elements of variable consideration.

Contract balances

As of June 30, 2021 and December 31, 2020, accounts receivable with customers were $366.1 million and $350.1 million, respectively. The following represents the rollforward of accounts receivable - reserve for doubtful accounts and contract assets and liabilities for the six months ended June 30, 2021 and 2020:

(in millions)
Accounts Receivable - Reserve for Doubtful Accounts	June 30, 2021		June 30, 2020
Balance as of beginning of fiscal year	$	4.3	$	4.6
Expense to increase the reserve	—		0.2
Write-off of uncollectible accounts	(0.4)		(0.3)
Balance as of period end	$	3.9	$	4.5

(in millions)
Contract Assets
Short-term	June 30, 2021		June 30, 2020
Balance as of beginning of fiscal year	$	38.9	$	38.5
Recognized in current year	48.9		37.5
Reclassified to accounts receivable	(30.4)		(34.5)
Impairment	—		—
Reclassification to/from long-term and contract liability	(5.1)		0.1
Balance as of period end	$	52.3	$	41.6
Long-term	June 30, 2021		June 30, 2020
Balance as of beginning of fiscal year	$	—	$	0.1
Recognized in current year	—		—
Reclassified to accounts receivable	—		—
Impairment	—		—
Reclassification to/from short-term	—		(0.1)
Balance as of period end	$	—	$	—

(in millions)
Contract Liabilities
Short-term	June 30, 2021		June 30, 2020
Balance as of beginning of fiscal year	$	111.8	$	78.7
Recognized in current year	77.9		97.9
Amounts in beginning balance reclassified to revenue	(63.9)		(33.9)
Current year amounts reclassified to revenue	(18.7)		(38.5)
Other	—		(0.2)
Reclassification to/from long-term and contract asset	(3.3)		5.8
Balance as of period end	$	103.8	$	109.8
Long-term	June 30, 2021		June 30, 2020
Balance as of beginning of fiscal year	$	32.0	$	25.9
Recognized in current year	41.0		12.4
Amounts in beginning balance reclassified to revenue	(0.5)		(0.5)
Current year amounts reclassified to revenue	—		—
Other	—		—
Reclassification to/from short-term	(1.8)		(5.8)
Balance as of period end	$	70.7	$	32.0

Contract costs for obtaining and fulfilling a contract were $5.5 million and $5.4 million as of June 30, 2021 and December 31, 2020, respectively, and are reported in other long-term assets on the consolidated balance sheet. Contract cost amortization expense for the three and six months ended June 30, 2021 was $0.3 million and $0.5 million, respectively. Contract cost amortization expense for the three and six months ended June 30, 2020 was $0.4 million and $0.7 million, respectively.