Revenue

12 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue

Note 3. Revenue

Sales of products

Woodward primarily generates revenue through the manufacture and sale of engineered aerospace and industrial products, including revenue derived from MRO performance obligations performed on products originally manufactured by Woodward and subsequently returned by OEM or other end-user customers. The majority of Woodward’s costs incurred to satisfy MRO performance obligations are related to replacing and/or refurbishing component parts of the returned products to restore the units back to a condition generally comparable to that of the unit upon its initial sale to an OEM customer. Therefore, Woodward considers almost all of its revenue to be derived from product sales, including those related to MRO.

	Year Ended September 30,
	2024			2023			2022
Manufactured products		83	%		84	%		84	%
MRO		15	%		14	%		14	%
Services		2	%		2	%		2	%

Point in time and over time revenue recognition

The amount of revenue recognized as point in time or over time follows:

	For the Year Ended September 30,
	2024						2023						2022
	Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated
Point in time	$	853,728	$	780,794	$	1,634,522	$	748,278	$	708,458	$	1,456,736	$	593,233	$	509,737	$	1,102,970
Over time		1,174,890		514,837		1,689,727		1,019,825		438,005		1,457,830		926,089		353,731		1,279,820
Total net sales	$	2,028,618	$	1,295,631	$	3,324,249	$	1,768,103	$	1,146,463	$	2,914,566	$	1,519,322	$	863,468	$	2,382,790

Material rights and costs to fulfill a contract

Amounts recognized related to changes in estimated total lifetime sales for material rights and costs to fulfill contracts with customers follows:

	Year Ended September 30,
	2024		2023		2022
Revenue	$	17,154	$	1,460	$	1,514
Cost of goods sold		15,486		1,736		667

Amounts recognized related to amortization of costs to fulfill contracts and contract liabilities, which were not related to changes in estimate, follows:

	Year Ended September 30,
	2024		2023		2022
Revenue	$	7,230	$	6,741	$	4,107
Cost of goods sold		3,112		5,559		3,077

As of September 30, 2024, “Other assets” on the Consolidated Balance Sheets included $185,102 of capitalized costs to fulfill contracts with customers, compared to $180,228 as of September 30, 2023.

Accounts receivable and contract assets

Customer receivables include amounts billed and currently due from customers as well as unbilled amounts (contract assets) and are included in “Accounts receivable” in Woodward’s Consolidated Balance Sheets. Amounts are billed in accordance with contractual terms, which are generally tied to shipment of the products to the customer, or as work progresses in accordance with contractual terms. Billed accounts receivable are typically due within 60 days. Woodward’s contracts with customers generally have no financing components.

Accounts receivable consisted of the following:

	September 30, 2024			September 30, 2023
Billed receivables
Trade accounts receivable	$	455,831		$	434,287
Other (Chinese financial institutions)		1,403			50,940
Total billed receivables		457,234			485,227
Current unbilled receivables (contract assets)		320,570			270,479
Total accounts receivable		777,804			755,706
Less: Allowance for uncollectible amounts		(7,738	)		(5,847	)
Total accounts receivable, net	$	770,066		$	749,859

As of September 30, 2024, “Other assets” on the Consolidated Balance Sheets includes $11,237 of unbilled receivables not expected to be invoiced and collected within a period of twelve months, compared to $7,332 as of September 30, 2023. Unbilled receivables not expected to be invoiced and collected within a period of twelve months are primarily attributable to the timing of revenue recognized in excess of billings in the Aerospace segment.

Billed and unbilled accounts receivable from the U.S. Government were less than 10% of total billed and unbilled accounts receivable at September 30, 2024 and September 30, 2023.

The allowance for uncollectible amounts and change in expected credit losses for trade accounts receivable and unbilled receivables (contract assets) consisted of the following:

	Year Ended September 30,
	2024			2023			2022
Balance, beginning	$	5,847		$	3,922		$	3,664
Changes in estimates		3,219			7,211			447
Write-offs		(586	)		(5,305	)		(46	)
Other1		(742	)		19			(143	)
Balance, ending	$	7,738		$	5,847		$	3,922

(1)Includes effects of foreign exchange rate changes during the period.

Contract liabilities

Contract liabilities consisted of the following:

	September 30, 2024				September 30, 2023
	Current		Noncurrent		Current		Noncurrent
Deferred revenue from material rights from JV formation	$	6,580	$	232,164	$	6,147	$	233,997
Deferred revenue from advanced invoicing and/or prepayments from customers		23,706		6,437		6,868		2,196
Liability related to customer supplied inventory		20,563		—		14,543		—
Deferred revenue from material rights related to engineering and development funding		5,942		186,008		6,190		178,464
Net contract liabilities	$	56,791	$	424,609	$	33,748	$	414,657

The current portion of contract liabilities is included in “Accrued liabilities” and the noncurrent portion is included in “Other liabilities” of Woodward’s Consolidated Balance Sheets. Woodward recognized revenue of $44,398 in the year ended September 30, 2024 from contract liabilities balances recorded as of September 30, 2023, compared to $25,190 in the year ended September 30, 2023 from contract liabilities balances recorded as of September 30, 2022.

The amount of revenue recognized related to noncash consideration received from customers follows:

	For the Year Ended September 30,
	2024		2023		2022
Aerospace	$	61,323	$	50,329	$	63,358
Industrial		4,974		1,939		2,343
Consolidated	$	66,297	$	52,268	$	65,701

Remaining performance obligations

Remaining performance obligations related to the aggregate amount of the total contract transaction price of firm orders for which the performance obligation has not yet been recognized in revenue as of September 30, 2024 was $2,932,793, compared to $2,325,533 as of September 30, 2023, the majority of which in both periods relate to Woodward’s Aerospace segment. Woodward expects to recognize almost all of these remaining performance obligations within two years after September 30, 2024.

Remaining performance obligations related to material rights that have not yet been recognized in revenue as of September 30, 2024 was $509,366, of which $14,788 is expected to be recognized in fiscal year 2025, and the balance is expected to be recognized thereafter. Woodward expects to recognize revenue from performance obligations related to material rights over the life of the underlying programs, which may be as long as forty years.

Disaggregation of revenue

Woodward designs, produces, and services reliable, efficient, low-emission, and high-performance energy control products for diverse applications in markets throughout the world. Woodward reports financial results for each of its Aerospace and Industrial reportable segments. Woodward further disaggregates its revenue from contracts with customers by primary market and by geographical area as Woodward believes this best depicts how the nature, amount, timing, and uncertainty of its revenue and cash flows are affected by economic factors.

Revenue by primary market for the Aerospace reportable segment was as follows:

	Year Ended September 30,
	2024		2023		2022
Commercial OEM	$	738,394	$	651,275	$	499,438
Commercial aftermarket		640,823		547,625		420,881
Defense OEM		406,810		368,653		422,016
Defense aftermarket		242,591		200,550		176,987
Total Aerospace segment net sales	$	2,028,618	$	1,768,103	$	1,519,322

Revenue by primary market for the Industrial reportable segment was as follows:

	Year Ended September 30,
	2024		2023		2022
Power generation	$	423,872	$	382,536	$	317,026
Transportation		642,174		527,498		354,682
Oil and gas		229,585		236,429		191,760
Total Industrial segment net sales	$	1,295,631	$	1,146,463	$	863,468

During fiscal year 2023, for purposes of how we assess performance, we determined that certain revenue was better aligned with our markets consisting of power generation, transportation, and oil and gas, rather than the reciprocating engines and industrial turbines, how it was previously reported. For comparability, we have reclassified revenue for the year ended September 30, 2022 to conform to the new presentation. This reclassification of revenue had no impact on our consolidated financial results.

The customers who account for approximately 10% or more of net sales of each of Woodward’s reportable segments are as follows:

	For the Year Ended September 30,
	2024	2023
Aerospace	RTX Corporation, The Boeing Company	RTX Corporation, GE, The Boeing Company
Industrial	Weichai Power, Rolls-Royce PLC	Rolls-Royce PLC, Caterpillar Inc., Weichai Power

Net sales by geographic area, as determined based on the location of the customer, were as follows:

	Year Ended September 30,
	2024						2023						2022
	Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated
United States	$	1,404,223	$	294,033	$	1,698,256	$	1,254,954	$	283,121	$	1,538,075	$	1,105,860	$	205,740	$	1,311,600
Germany		72,583		196,775		269,358		80,450		193,392		273,842		57,840		174,216		232,056
Europe, excluding Germany		202,421		297,517		499,938		163,222		273,757		436,979		128,719		234,795		363,514
China		96,136		293,908		390,044		56,773		186,713		243,486		49,407		86,972		136,379
Asia, excluding China		59,103		163,603		222,706		37,107		162,922		200,029		23,334		128,855		152,189
Other countries		194,152		49,795		243,947		175,597		46,558		222,155		154,162		32,890		187,052
Total net sales	$	2,028,618	$	1,295,631	$	3,324,249	$	1,768,103	$	1,146,463	$	2,914,566	$	1,519,322	$	863,468	$	2,382,790