Revenue and Customer Contract Balances

9 Months Ended

May 26, 2023

Revenue from Contract with Customer [Abstract]

Revenue and Customer Contract Balances

Revenue and Customer Contract Balances

Net Sales and Gross Billings

We provide certain logistics services on an agent basis, whereby we procure materials on behalf of our customers and then resell such materials to our customers. Our logistics services business includes procurement, logistics, inventory management, temporary warehousing, kitting and/or packaging services. While we take title to inventory under such arrangements, control of such inventory does not transfer to us as we do not, at any point, have the ability to direct the use, and thereby obtain the benefits of, the inventory.

Gross amounts invoiced to customers in connection with these agent services include amounts related to the services performed by us in addition to the cost of the materials procured. However, only the amount related to the agent component is recognized as revenue in our results of operations. We generally recognize revenue for these procurement, logistics and inventory management services upon the completion of such services, which typically occurs at the time of shipment of product to the customer. The cost of materials invoiced to our customers under these arrangements, but not recognized as revenue or cost of sales in our results of operations, were as follows:

	Three Months Ended				Nine Months Ended
	May 26, 2023		May 27, 2022		May 26, 2023		May 27, 2022
Cost of materials invoiced in connection with logistics services	$	143,128	$	574,034	$	664,863	$	1,250,024

Customer Contract Balances

As of	May 26, 2023		August 26, 2022
Contract assets (1)	$	767	$	1,322
Contract liabilities: (2)
Deferred revenue (3)	$	70,743	$	39,676
Customer advances	14,780		24,125
	$	85,523	$	63,801

(1)Contract assets are included in other current and noncurrent assets.

(2)Contract liabilities are included in other current and noncurrent liabilities based on the timing of when our customer is expected to take control of the asset or receive the benefit of the service.

(3)Deferred revenue includes $11.2 million and $23.3 million as of May 26, 2023 and August 26, 2022, respectively, related to contracts that contain termination rights.

Deferred revenue represents amounts received from customers in advance of satisfying performance obligations. As of May 26, 2023, we expect to recognize revenue of $53.7 million of the balance of $70.7 million in the next 12 months and the remaining amount thereafter. In the first nine months of 2023, we recognized revenue of $25.1 million from satisfying performance obligations related to amounts included in deferred revenue as of August 26, 2022.

Customer advances represent amounts received from customers for advance payments to secure product. In the first nine months of 2023, we recognized revenue of $18.9 million from satisfying performance obligations related to amounts included in customer advances as of August 26, 2022.

As of May 26, 2023 and August 26, 2022, other current liabilities included $10.6 million and $15.4 million, respectively, for estimates of consideration payable to customers, including estimates for pricing adjustments and returns.