Revenue Recognition

12 Months Ended

Dec. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

NOTE 11 – REVENUE RECOGNITION

Disaggregation of Revenue

The Company disaggregates revenue from clients into categories that depict how the nature, amount, and uncertainty of revenue and cash flows are affected by economic and business factors. Those categories are client market, client type, and contract mix.

Client markets provide insight into the breadth of the Company’s expertise. In classifying revenue by client market, the Company attributes revenue from a client to the market that the Company believes is the client’s primary market. The Company also classifies revenue by the type of client for which it does business, which is an indicator of the diversity of its client base. The Company attributes revenue generated as a subcontractor to the market or type of the ultimate client. Disaggregation by contract mix provides insight in terms of the degree of performance risk that the Company has assumed. Fixed-price contracts are considered to provide the highest amount of performance risk as the Company is required to deliver a scope of work or level of effort for a negotiated fixed price. Time-and-materials contracts require the Company to provide skilled employees for negotiated fixed hourly rates. Since the Company is not required to deliver a scope of work, but merely skilled employees, it considers these contracts to be less risky than a fixed-price agreement. Cost-based contracts are considered to provide the lowest amount of performance risk since the Company is generally reimbursed for all contract costs incurred in performance of contract deliverables with only the amount of incentive or award fees (if applicable) dependent on the achievement of negotiated performance requirements.

The Company’s revenue by client markets, type, and contract mix are in the following tables. Certain immaterial revenue amounts in the prior years have been reclassified due to minor adjustments and reclassification.

	Year ended December 31,
	2024		2023		2022
Client Markets:
Energy, environment, infrastructure, and disaster recovery	$	929,711	$	805,942	$	714,628
Health and social programs		764,477		814,789		704,465
Security and other civilian & commercial		325,599		342,507		360,871
Total	$	2,019,787	$	1,963,238	$	1,779,964

	Year ended December 31,
	2024		2023		2022
Client Type:
U.S. federal government	$	1,087,349	$	1,084,047	$	980,746
U.S. state and local government		316,083		309,516		259,764
International government		110,798		103,446		103,609
Total Government		1,514,230		1,497,009		1,344,119
Commercial		505,557		466,229		435,845
Total	$	2,019,787	$	1,963,238	$	1,779,964

	Year ended December 31,
	2024		2023		2022
Contract Mix:
Time-and-materials	$	855,538	$	811,911	$	713,693
Fixed-price		932,351		886,200		802,568
Cost-based		231,898		265,127		263,703
Total	$	2,019,787	$	1,963,238	$	1,779,964

Contract Assets and Liabilities:

Contract assets consist of unbilled receivables on contracts where revenue recognized exceeds the amount billed. Contract liabilities result from advance payments received on a contract or from billings in excess of revenue recognized on long-term contracts.

The following table summarizes the contract balances as of December 31, 2024 and December 31, 2023:

	December 31, 2024			December 31, 2023			Change
Contract assets	$	188,941		$	201,832		$	(12,891	)
Contract liabilities		(24,580	)		(21,997	)		(2,583	)
Net contract assets (liabilities)	$	164,361		$	179,835		$	(15,474	)

The net contract assets (liabilities) as of December 31, 2024 decreased by $15.5 million as compared to December 31, 2023, primarily due to the timing difference between the performance of services and billings to and payments from customers. There were no material changes to contract balances due to impairments or credit losses during the period. During the years ended December 31, 2024 and 2023, the Company recognized $17.6 million and $17.8 million in revenue related to the contract liabilities balance at December 31, 2023 and 2022, respectively.

Unfulfilled Performance Obligations:

The Company had $1.3 billion in remaining unfulfilled performance obligations (“UPO”) as of December 31, 2024 which the Company expects to recognize as revenue approximately 61% by December 31, 2025, 73% by December 31, 2026, and the remaining thereafter.

Subsequent to December 31, 2024, and through February 25, 2025, pursuant to the recent executive orders issued by the Administration or actions by DOGE, the Company received notices for termination-for-convenience and for stop-work orders. Had these termination-for-convenience occurred prior to December 31, 2024, the total UPO would be reduced by approximately $245 million. It is unknown if the stop-work orders notices will be lifted and the Company will resume work on these programs, or if the stop-work orders will result in a termination-for-convenience.