Deferred Revenue

9 Months Ended

Sep. 30, 2022

Deferred Revenue

Deferred Revenue

8. Deferred Revenue

Deferred revenue consists of the following:

	September 30,		December 31,
	2022		2021
	(In thousands)
Cash received prior to fulfillment	$	6,501	$	4,861
March Sponsorship Gift Cards		5,954		—
May Sponsorship Gift Cards		6,213		—
Gift cards, prepaid orders, and other		2,198		3,097
Deferred revenue	$	20,866	$	7,958

Under ASC 606, Revenue from Contracts with Customers, the Company has two types of contractual liabilities: (i) cash collections from its customers prior to delivery of products purchased, which are included in Deferred revenue on the Consolidated Balance Sheets, and are recognized as revenue upon transfer of control of its products, and (ii) unredeemed gift cards and other prepaid orders, which are included in Deferred revenue on the Consolidated Balance Sheets, and are recognized as revenue when gift cards are redeemed and the products are delivered. Certain gift cards are not expected to be redeemed, also known as breakage, and are recognized as revenue over the expected redemption period, subject to requirements to remit balances to governmental agencies.

Contractual liabilities included in Deferred revenue on the Consolidated Balance Sheets were $20.9 million and $8.0 million as of September 30, 2022 and December 31, 2021, respectively. During the nine months ended September 30, 2022, the Company recognized $6.6 million to Net revenue from the Deferred revenue as of December 31, 2021.

See Notes 2 and 13 for further information regarding the March Sponsorship Gift Cards and May Sponsorship Gift Cards.