Product Warranty

3 Months Ended

Mar. 31, 2020

Note 10. Product Warranty

We generally offer a one year warranty for all of our systems, the terms and conditions of which vary depending upon the product sold. For all systems sold, we accrue a liability for the estimated cost of standard warranty at the time of system shipment and defer the portion of systems revenue attributable to the fair value of non-standard warranty. Costs for non-standard warranty are expensed as incurred. Factors that affect our warranty liability include the number of installed units, historical and anticipated product failure rates, material usage and service labor costs. We periodically assess the adequacy of our recorded liability and adjust the amount as necessary.

The changes in our standard product warranty liability are as follows:


	Three months ended
	March 31,
	2020		2019
	(in thousands)
Balance at January 1 (beginning of year)	$	3,244	$	5,091
Warranties issued during the period		1,385		954
Settlements made during the period		(950)		(1,475)
Changes in estimate of liability for pre-existing warranties during the period		126		89
Balance at March 31 (end of period)	$	3,805	$	4,659

Amount classified as current	$	3,431	$	4,319
Amount classified as long-term		374		340
Total warranty liability	$	3,805	$	4,659