Note 2 - Revenue Recognition

9 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

2. Revenue Recognition 

Disaggregation of revenue

The following table provides information about disaggregated revenue by primary geographical area and operating segment (in thousands):

	Three Months Ended September 30, 2022						Three Months Ended September 30, 2021
	Partner		Edge to				Partner		Edge to
	Solutions		Cloud		Total		Solutions		Cloud		Total
Primary geographic area:
North America	$	6,877	$	821	$	7,698	$	8,294	$	964	$	9,258
Europe		100		28		128		68		44		112
Asia		580		—		580		1,276		—		1,276
Total	$	7,557	$	849	$	8,406	$	9,638	$	1,008	$	10,646

	Nine Months Ended September 30, 2022						Nine Months Ended September 30, 2021
	Partner		Edge to				Partner		Edge to
	Solutions		Cloud		Total		Solutions		Cloud		Total
Primary geographic area:
North America	$	23,335	$	2,407	$	25,742	$	23,372	$	2,695	$	26,067
Europe		253		83		336		275		201		476
Asia		2,454		—		2,454		4,746		—		4,746
Total	$	26,042	$	2,490	$	28,532	$	28,393	$	2,896	$	31,289

For the quarter ended September 30, 2022 and 2021, $7.7 million and $9.6 million of revenue was recorded at a point-in-time, and $0.7 million and $1.0 million of revenue was recorded over-time, respectively. For the nine months ended September 30, 2022 and 2021, $26.9 million and $28.4 million of revenue was recorded at a point-in-time, and $1.7 million and $2.9 million of revenue was recorded over-time, respectively.

Contract balances

We receive payments from customers based upon contractual billing schedules. Accounts receivable are recorded when the right to consideration becomes unconditional. Contract assets include amounts related to our contractual right to consideration for completed performance obligations not yet invoiced. Contract liabilities, presented as deferred revenue on our condensed consolidated balance sheets, include payments received in advance of performance under the contract and are realized when the associated revenue is recognized. We had no asset impairment charges related to contract assets for each of the three and nine months ended September 30, 2022 and 2021. 

Significant changes in the contract assets and the deferred revenue balances during the three and nine months ended September 30, 2022were as follows (in thousands):

	Three Months Ended September 30, 2022		Nine Months Ended September 30, 2022
	Contract		Contract
	Assets		Assets
Balance at beginning of period	$	51	$	46
Revenue recognized		—		50
Amounts collected or invoiced		—		(45	)
Balance at end of period	$	51	$	51

	Three Months Ended September 30, 2022			Nine Months Ended September 30, 2022
	Deferred			Deferred
	Revenue			Revenue
Balance at beginning of period	$	577		$	1,138
Revenue recognized		(253	)		(1,173	)
Amounts collected or invoiced		65			424
Balance at end of period	$	389		$	389

 

Contract acquisition costs

We capitalize contract acquisition costs for contracts with a life exceeding one year. Amortization of contract acquisition costs was $3,000 and $4,000 for the three months ended September 30, 2022 and 2021, respectively, and was $12,000 and $57,000 for the nine months ended September 30, 2022 and 2021, respectively. There were no asset impairment charges for contract acquisition costs for any of the periods noted above.

Transaction price allocated to the remaining performance obligations

The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied at the end of the reporting period. The satisfaction of performance obligations varies based on the nature of the underlying promise and the customer. The estimated revenue does not include contracts with original durations of one year or less, amounts of variable consideration attributable to royalties, or contract renewals that were unexercised as of September 30, 2022:

	Remainder of
	2022		2023		2024		2025		2026
Edge to Cloud	$	326	$	1,612	$	1,330	$	—	$	—

Practical expedients and exemptions

We generally expense sales commissions when incurred because the amortization period would have been less than one year. We record these costs within selling, general and administrative expenses.

When applicable and appropriate, the Company utilizes the ‘as-invoiced’ practical expedient which permits revenue recognition upon invoicing.