Revenue

9 Months Ended

Jun. 30, 2022

Revenue From Contract With Customer [Abstract]

Revenue

Note 3.  Revenue

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

	Three-Months Ended June 30, 2022						Three-Months Ended June 30, 2021
	Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated
Point in time	$	154,323	$	119,808	$	274,131	$	114,947	$	128,868	$	243,815
Over time		247,389		92,812		340,201		225,965		86,895		312,860
Total net sales	$	401,712	$	212,620	$	614,332	$	340,912	$	215,763	$	556,675

	Nine-Months Ended June 30, 2022						Nine-Months Ended June 30, 2021
	Aerospace		Industrial		Consolidated		Aerospace		Industrial		Consolidated
Point in time	$	428,212	$	367,019	$	795,231	$	336,477	$	414,305	$	750,782
Over time		682,692		264,834		947,526		690,808		234,025		924,833
Total net sales	$	1,110,904	$	631,853	$	1,742,757	$	1,027,285	$	648,330	$	1,675,615

Accounts Receivable

Accounts receivable consisted of the following:

	June 30, 2022			September 30, 2021
Billed receivables
Trade accounts receivable	$	318,227		$	298,951
Other (Chinese financial institutions)		3,042			23,168
Total billed receivables		321,269			322,119
Current unbilled receivables (contract assets)		269,320			204,596
Total accounts receivable		590,589			526,715
Less: Allowance for uncollectible amounts		(3,043	)		(3,664	)
Total accounts receivable, net	$	587,546		$	523,051

As of June 30, 2022, “Other assets” on the Condensed Consolidated Balance Sheets includes $4,832 of unbilled receivables not expected to be invoiced and collected within a period of twelve months, compared to $9,424 as of September 30, 2021.

Accounts receivable in Woodward’s Condensed Consolidated Financial Statements represent the net amount expected to be collected, and an allowance for uncollectible amounts related to credit losses is established based on expected losses. Expected losses are estimated by reviewing specific customer accounts, taking into consideration accounts receivable aging, credit risk of the customers, and historical payment history, as well as current and forecasted economic conditions and other relevant factors.

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

	Three-Months Ended June 30,						Nine-Months Ended June 30,
	2022			2021			2022			2021
Balance, beginning	$	3,141		$	7,522		$	3,664		$	8,359
Charged to costs and expenses, or sales allowance		356			581			783			1,709
Deductions		(302	)		(4,367	)		(1,410	)		(6,375	)
Other additions1		(152	)		95			6			138
Balance, ending	$	3,043		$	3,831		$	3,043		$	3,831

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

Contract liabilities

Contract liabilities consisted of the following:  

	June 30, 2022				September 30, 2021
	Current		Noncurrent		Current		Noncurrent
Deferred revenue from material rights from GE joint venture formation	$	5,508	$	235,763	$	4,771	$	234,237
Deferred revenue from advanced invoicing and/or prepayments from customers		1,288		39		4,192		290
Liability related to customer supplied inventory		12,657		—		14,169		—
Deferred revenue from material rights related to engineering and development funding		6,397		160,827		6,395		151,797
Net contract liabilities	$	25,850	$	396,629	$	29,527	$	386,324

Woodward recognized revenue of $5,140 in the three-months and $18,359 in the nine-months ended June 30, 2022 from contract liabilities balances recorded as of October 1, 2021, compared to $3,135 in the three-months and $16,809 in the nine-months ended June 30, 2021 from contract liabilities balances recorded as of October 1, 2020.

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 June 30, 2022 was $1,595,880, compared to $1,283,311 as of September 30, 2021, the majority of which relates to Woodward’s Aerospace segment in both periods.  Woodward expects to recognize almost all of these remaining performance obligations within two years after June 30, 2022.  

Remaining performance obligations related to material rights that have not yet been recognized in revenue as of June 30, 2022 was $450,888, compared to $471,133 as of September 30, 2021, of which $2,413 is expected to be recognized in the remainder of fiscal year 2022, $12,681 is expected to be recognized in fiscal year 2023, and the remaining 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 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:

	Three-Months Ended June 30,				Nine-Months Ended June 30,
	2022		2021		2022		2021
Commercial OEM	$	131,968	$	96,290	$	359,683	$	274,278
Commercial aftermarket		108,695		75,508		303,335		218,602
Defense OEM		115,205		117,204		318,392		384,097
Defense aftermarket		45,844		51,910		129,494		150,308
Total Aerospace segment net sales	$	401,712	$	340,912	$	1,110,904	$	1,027,285

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

	Three-Months Ended June 30,				Nine-Months Ended June 30,
	2022		2021		2022		2021
Reciprocating engines	$	154,090	$	166,143	$	469,087	$	494,099
Industrial turbines		58,530		49,620		162,766		154,231
Total Industrial segment net sales	$	212,620	$	215,763	$	631,853	$	648,330

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

	Three and Nine-Months Ended June 30, 2022
Aerospace	The Boeing Company, General Electric Company, Raytheon Technologies
Industrial	Rolls-Royce PLC, Wartsila, Caterpillar, Inc.