Other Financial Information

6 Months Ended

Jun. 30, 2021

Other Financial Information [Abstract]

Note 7. Other Financial Information

Total Inventory

Total inventory consisted of the following (in millions):


	As of
	June 30, 2021		December 31, 2020
Production and service materials	$	167.5	$	158.1
Finished goods	54.8		63.8
Total inventory	$	222.3	$	221.9

Reported as:
Inventory	$	211.5	$	210.2
Other long-term assets	10.8		11.7
Total inventory	$	222.3	$	221.9

Deposit

The Company has a non-interest bearing deposit balance of $66.4 million, net of an unamortized discount balance of $4.7 million, to a contract manufacturer. The discount is calculated based on an imputed interest rate of 5.1% at June 30, 2021. The imputed interest will be amortized over the term of the deposit to interest income along with a corresponding charge to cost of revenues. The deposit is classified as other long-term asset on the Condensed Consolidated Balance Sheets.

Warranties

Changes during the six months ended June 30, 2021 in the Company’s warranty reserve as reported within other accrued liabilities in the Condensed Consolidated Balance Sheets were as follows (in millions):


Balance as of December 31, 2020	$	30.2
Provisions made during the period	19.4

Actual costs incurred during the period	(18.8)

Balance as of June 30, 2021	$	30.8

Revenue

See Note 12, Segments, for disaggregated revenue by product and service, customer vertical, and geographic region.

Product revenue of $14.2 million and $42.9 million included in deferred revenue at January 1, 2021 was recognized during the three and six months ended June 30, 2021, respectively. Service revenue of $212.5 million and $490.2 million included in deferred revenue at January 1, 2021 was recognized during the three and six months ended June 30, 2021, respectively.

The following table summarizes the transaction price for contracts that have not yet been recognized as revenue as of June 30, 2021 and when the Company expects to recognize the amounts as revenue (in millions):


	Revenue Recognition Expected by Period
	Total		Less than 1 year		1-3 years		More than 3 years
Product	$	120.9	$	102.3	$	15.5	$	3.1
Service(*)	1,225.2		798.3		350.2		76.7
Total	$	1,346.1	$	900.6	$	365.7	$	79.8

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(*) Represents unearned service revenue allocated to the performance obligations not delivered or partially delivered as of June 30, 2021. The unearned service revenue is comprised of deferred revenue and non-cancellable contract revenue, which has not been invoiced yet.

Deferred Commissions

Deferred commissions were $30.6 million as of June 30, 2021. For the three and six months ended June 30, 2021, amortization expense for the deferred commissions was $42.5 million and $82.9 million, and there were no impairment charges recognized.

Other Expense, Net

Other expense, net, consisted of the following (in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Interest income	$	3.4	$	9.3	$	7.5	$	24.4
Interest expense	(12.6)		(19.3)		(26.3)		(39.5)
(Loss) gain on investments, net	(1.2)		6.5		2.6		0.7
Other	(0.5)		(0.9)		0.3		(1.1)
Other expense, net	$	(10.9)	$	(4.4)	$	(15.9)	$	(15.5)