Revenue

9 Months Ended

Oct. 01, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Note 3. Revenue

Revenue from contracts with customers is recognized when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

Transaction Price Allocated to the Remaining Performance Obligations

Remaining performance obligations represent the transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied, which are primarily from hardware and, to a lesser extent, subscription and support services, as of the end of the reporting period. Unsatisfied and partially unsatisfied performance obligations consist of contract liabilities, in-transit orders with destination terms, and non-cancellable backlog. Non-cancellable backlog includes goods for which customer purchase orders have been accepted that are scheduled or in the process of being scheduled for shipment, and that are not yet invoiced. This disclosure includes estimates of variable consideration.

The following table summarizes estimated revenue expected to be recognized in the future related to performance obligations that were unsatisfied (or partially unsatisfied) as of October 1, 2023:

(In thousands)	Less than 1 year		1 to 2 years		Beyond 2 years		Total
Performance obligations	$	86,773	$	2,431	$	2,368	$	91,572

Contract Balances

The Company records accounts receivable when it has an unconditional right to consideration. Contract liabilities are recorded when cash payments are received or due in advance of performance. Contract liabilities consist of advance payments and deferred revenue, where the Company has unsatisfied performance obligations. Contract liabilities are mainly classified as Deferred revenue on the unaudited condensed consolidated balance sheets.

Payment terms vary by customer. The time between invoicing and when payment is due is not significant. For certain products or services and customer types, payment is required before the products or services are delivered to the customer.

The following table reflects the contract balances:

(In thousands)	Balance Sheet Location	October 1, 2023		December 31, 2022
Accounts receivable, net	Accounts receivable, net	$	200,900	$	277,485
Contract liabilities - current	Deferred revenue	$	25,090	$	21,128
Contract liabilities - non-current	Other non-current liabilities	$	4,706	$	3,897

The difference in the balances of the Company's contract assets and liabilities as of October 1, 2023 and December 31, 2022, primarily results from the timing difference between the Company's performance and the customer’s payment.

During the nine months ended October 1, 2023, $34.9 million of revenue was deferred primarily due to unsatisfied performance obligations for service contracts, $30.1 million of revenue was recognized for the satisfaction of performance

obligations and $19.1 million of this recognized revenue was included in the contract liability balance at the beginning of the period.

There were no significant changes in estimates during the period that would affect the contract balances.

Disaggregation of Revenue

In the following tables, net revenue is disaggregated by geographic region and sales channel. The Company conducts business across three geographic regions: Americas; Europe, Middle East and Africa (“EMEA”); and Asia Pacific (“APAC”). The tables also include reconciliations of the disaggregated revenue by reportable segment. The Company operates and reports in two segments: Connected Home, and Small and Medium Business (“SMB”). Sales and usage-based taxes are excluded from net revenue.

	Three Months Ended
	October 1, 2023						October 2, 2022
(In thousands)	Connected Home		SMB		Total		Connected Home		SMB		Total
Geographic regions (1):
Americas	$	104,695	$	36,323	$	141,018	$	120,168	$	49,192	$	169,360
EMEA		10,898		24,786		35,684		12,545		32,282		44,827
APAC		11,742		9,401		21,143		17,868		17,532		35,400
Total	$	127,335	$	70,510	$	197,845	$	150,581	$	99,006	$	249,587
Sales channels:
Service provider	$	32,403	$	219	$	32,622	$	40,448	$	1,171	$	41,619
Non-service provider		94,932		70,291		165,223		110,133		97,835		207,968
Total	$	127,335	$	70,510	$	197,845	$	150,581	$	99,006	$	249,587

	Nine Months Ended
	October 1, 2023						October 2, 2022
(In thousands)	Connected Home		SMB		Total		Connected Home		SMB		Total
Geographic regions (1):
Americas	$	266,379	$	113,172	$	379,551	$	327,372	$	130,664	$	458,036
EMEA		34,279		76,744		111,023		34,230		92,413		126,643
APAC		27,829		33,763		61,592		48,185		50,505		98,690
Total	$	328,487	$	223,679	$	552,166	$	409,787	$	273,582	$	683,369
Sales channels:
Service provider	$	71,346	$	427	$	71,773	$	92,544	$	3,515	$	96,059
Non-service provider		257,141		223,252		480,393		317,243		270,067		587,310
Total	$	328,487	$	223,679	$	552,166	$	409,787	$	273,582	$	683,369

(1) No individual foreign country represented more than 10% of the Company's total net revenue in the periods presented.