Revenue

12 Months Ended

Sep. 30, 2021

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,
	2021			2020			2019
Manufactured products		86	%		86	%		86	%
MRO		13	%		12	%		12	%
Services		1	%		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,
	2021						2020						2019
	Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated
Point in time	$	481,422	$	527,233	$	1,008,655	$	590,817	$	592,157	$	1,182,974	$	762,042	$	634,219	$	1,396,261
Over time		922,695		314,482		1,237,177		1,000,146		312,545		1,312,691		1,118,478		385,458		1,503,936
Total net sales	$	1,404,117	$	841,715	$	2,245,832	$	1,590,963	$	904,702	$	2,495,665	$	1,880,520	$	1,019,677	$	2,900,197

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:

	For the Year Ended September 30,
	2021		2020		2019
Revenue	$	2,671	$	6,784	$	6,017
Cost of goods sold		1,961		6,638		9,580

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

	For the Year Ended September 30,
	2021		2020		2019
Revenue	$	4,455	$	1,664	$	719
Cost of goods sold		3,466		1,241		376

As of September 30, 2021, “Other assets” on the Consolidated Balance Sheets included $152,885 of capitalized costs to fulfill contracts with customers, compared to $133,349 as of September 30, 2020.

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, 2021			September 30, 2020
Billed receivables
Trade accounts receivable	$	298,951		$	307,914
Other (Chinese financial institutions)		23,168			56,640
Total billed receivables		322,119			364,554
Current unbilled receivables (contract assets)		204,596			181,792
Total accounts receivable		526,715			546,346
Less: Allowance for uncollectible amounts		(3,664	)		(8,359	)
Total accounts receivable, net	$	523,051		$	537,987

As of September 30, 2021, “Other assets” on the Consolidated Balance Sheets includes $9,424 of unbilled receivables not expected to be invoiced and collected within a period of twelve months, compared to $16,751 as of September 30, 2020.  Unbilled receivables not expected to be invoiced and collected within a period of twelve months are primarily attributable to customer delays for deliveries on firm orders in the Aerospace segment due to the impacts of the COVID-19 pandemic.

Billed and unbilled accounts receivable from the U.S. Government were less than 10% of total billed and unbilled accounts receivable at September 30, 2021 and September 30, 2020.

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,
	2021			2020			2019
Balance, beginning	$	8,359		$	8,936		$	3,938
Charged to costs and expenses, or sales allowance		2,382			4,735			5,927
Deductions		(7,255	)		(5,342	)		(1,180	)
Other additions1		178			30			251
Balance, ending	$	3,664		$	8,359		$	8,936

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

Woodward adopted ASU 2016-13 on October 1, 2021.  The change in the allowance for uncollectible amounts during the fiscal year ended September 30, 2020 and 2019 is based on incurred losses rather than expected credit losses per the CECL impairment model.

Contract liabilities  

Contract liabilities consisted of the following:  

	September 30, 2021				September 30, 2020
	Current		Noncurrent		Current		Noncurrent
Deferred revenue from material rights from GE joint venture formation	$	4,771	$	234,237	$	4,066	$	234,240
Deferred revenue from advanced invoicing and/or prepayments from customers		4,192		290		3,239		85
Liability related to customer supplied inventory		14,169		—		14,955		—
Deferred revenue from material rights related to engineering and development funding		6,395		151,797		2,360		132,317
Net contract liabilities	$	29,527	$	386,324	$	24,620	$	366,642

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 $19,925 in the year ended September 30, 2021 from contract liabilities balances recorded as of September 30, 2020, compared to $29,579 in the year ended September 30, 2020 from contract liabilities balances recorded as of September 30, 2019.

Woodward recognized revenue of $71,517 for the fiscal year 2021, compared to $79,569 for the fiscal year 2020 and $98,061 for fiscal year 2019, related to noncash consideration received from customers.  The Aerospace segment recognized $69,195 for the fiscal year ended September 30, 2021, compared to $78,179 for the fiscal year ended September 30, 2020 and $96,762 for the fiscal year ended September 30, 2019, while the Industrial segment recognized $2,322 for the fiscal year ended September 30, 2021 compared to $1,390 for the fiscal year ended September 30, 2020 and $1,299 for the fiscal year ended September 30, 2019.

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, 2021 was $1,283,311, compared to $1,454,406 as of September 30, 2020, 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, 2021.  

Remaining performance obligations related to material rights that have not yet been recognized in revenue as of September 30, 2021 was $471,133, of which $11,265 is expected to be recognized in fiscal year 2022, 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,
	2021		2020		2019
Commercial OEM	$	386,543	$	434,306	$	659,336
Commercial aftermarket		306,547		399,843		497,795
Defense OEM		509,815		526,264		529,940
Defense aftermarket		201,212		230,550		193,449
Total Aerospace segment net sales	$	1,404,117	$	1,590,963	$	1,880,520

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

	Year Ended September 30,
	2021		2020		2019
Reciprocating engines	$	639,946	$	632,555	$	751,136
Industrial turbines		201,769		222,366		210,064
Renewables1		—		49,781		58,477
Total Industrial segment net sales	$	841,715	$	904,702	$	1,019,677

(1) Sales in the renewables market were discontinued as of May 1, 2020 following the closing of the divestiture of the disposal group (see Note 10, Sale of businesses).

The customers who account for approximately 10% or more of net sales of each of Woodward’s reportable segments for the fiscal years ended September 30, 2021 and 2020 are as follows:

	Customer
Aerospace	The Boeing Company, General Electric Company, Raytheon Technologies
Industrial	Rolls-Royce PLC, Weichai Westport, General Electric Company

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

	Year Ended September 30,
	2021						2020						2019
	Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated
United States	$	1,103,373	$	174,750	$	1,278,123	$	1,231,004	$	195,450	$	1,426,454	$	1,415,880	$	212,184	$	1,628,064
Germany		31,005		152,691		183,696		52,635		181,330		233,965		72,907		229,177		302,084
Europe, excluding Germany		95,984		195,957		291,941		122,938		214,033		336,971		178,905		252,511		431,416
China		35,286		178,983		214,269		38,359		171,526		209,885		47,492		167,337		214,829
Asia, excluding China		23,363		114,137		137,500		27,068		113,001		140,069		37,991		126,497		164,488
Other countries		115,106		25,197		140,303		118,959		29,362		148,321		127,345		31,971		159,316
Total net sales	$	1,404,117	$	841,715	$	2,245,832	$	1,590,963	$	904,702	$	2,495,665	$	1,880,520	$	1,019,677	$	2,900,197