Deferred Revenue

12 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Deferred Revenue

DEFERRED REVENUE

The Company records deferred revenue when revenue is to be recognized subsequent to invoicing. For extended service contracts, the Company generally invoices customers at the beginning of the extended service contract term. The Company’s extended service contracts typically have one to three-year terms. The Company leases certain AviClear devices to customers and receives a fixed annual license fee over the term of the arrangement and variable lease income related to treatments performed by the lessee. The fixed annual license fee is recognized evenly over the period of the lease contract on a straight-line basis. Deferred revenue also includes payments for training not yet delivered. Approximately 87% of the Company’s deferred revenue balance of $11.9 million as of December 31, 2023, will be recognized over the next 12 months.

The following table provides changes in the deferred revenue balance for the years ended December 31, 2023 and 2022 (in thousands):

	December 31,
	2023		2022
Beginning balance	$	13,498	$	10,825
Add: Payments received from current period sales	21,040		21,984
Less: Revenue recognized from current period sales	(11,732)		(9,928)
Less: Revenue recognized from beginning balance	(10,890)		(9,383)
Ending balance	$	11,916	$	13,498

The fixed annual license fees received related to the AviClear contracts are deferred and recognized over the annual lease period. The AviClear deferred license fee balance included in the total deferred revenue balance as of December 31, 2023 and 2022, was $2.1 million and $2.3 million, respectively.

Costs for extended service contracts were $7.3 million, $6.3 million and $8.3 million, respectively, in cost of revenue on the consolidated statements of operations for the years ended December 31, 2023, 2022 and 2021.

Accounts receivable, net as of December 31, 2021 was $31.4 million.