Deferred Revenue

9 Months Ended

Sep. 30, 2020

Deferred Revenue [Abstract]

Deferred Revenue

11. DEFERRED REVENUE

Payment terms typically require payment upon shipment or installation of the System and additional payments as access codes for Treatment Sessions are delivered, which can span several years after the System is first delivered and installed. The timing of revenue recognition compared to billings and cash collections typically results in accounts receivable. However, sometimes customer advances and deposits might be required for certain customers and are recorded as deferred revenue. For multi-year agreements, the Company generally invoices customers annually at the beginning of each annual coverage period and recognizes revenue over the term of the coverage period.

As of September 30, 2020, the Company expects to recognize approximately the following percentages of deferred revenue by year:

Year:	Revenue Recognition
Remainder of 2020		25	%
2021		29	%
2022		14	%
2023		14	%
2024		14	%
Thereafter		4	%
Total		100	%

Revenue recognized for the three and nine months ended September 30, 2020 that was included in the contract liability balance at the beginning of the year was $0.4 million and $1.7 million respectively, and primarily represented revenue earned from separately priced extended warranties, rent-to-own revenue, milestone revenue, and clinical training.

Customers

For the three and nine months ended September 30, 2020 one customer accounted for more than 10% of the Company’s revenues. No customers accounted for more than 10% of the Company’s revenues for the three months ended September 30, 2019 and one customer accounted for more than 10% for the nine months ended September 30, 2019.