Revenue

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenue

REVENUE

Contract Balances

The timing of revenue recognition, billings and cash collections can result in billed accounts receivable, unbilled receivables (contract assets), and deferred revenue (contract liabilities).

Contract assets primarily relate to the rights to consideration for progress on contractual requirements performed but not billed at the reporting date. The contract assets are transferred to accounts receivable when the rights become unconditional. As of September 30, 2022 and December 31, 2021, the Company did not have contract assets recorded.

Accounts receivable is the Company’s right to consideration that is unconditional. A right to consideration is unconditional if only the passage of time is required before payment of that consideration is due. As of September 30, 2022 and December 31, 2021, the accounts receivable balances were $782 and $262, respectively.

Contract liabilities primarily consist of deferred revenue. Deferred revenue is the amount invoiced as progress payments in advance of revenue recognition; and is recognized as revenue when the recognition criteria are met. The Company’s contracts generally permit invoicing based on pre-defined milestones as outlined in the contract. As of September 30, 2022 and December 31, 2021, the total deferred revenue balances were $2,582 and $2,864, respectively.

Deferred revenue is classified as long term when the performance obligation is to be satisfied more than twelve months following the balance sheet date. As of September 30, 2022 and December 31, 2021, $1,787 and $501 of the total deferred revenue balance was considered long-term, respectively.

As of September 30, 2022, the aggregate amount of the transaction price allocated to the remaining performance obligations related to customer contracts that were unsatisfied or partially unsatisfied was $8,447. Given the applicable contract terms, $3,110 is expected to be recognized as revenue within one year and $5,337 is expected to be recognized between two to five years. This amount does not include contracts to which the customer is not committed. The estimated timing of the recognition of remaining unsatisfied performance obligations, all of which are recognized at a point in time, is subject to change and is affected by changes to scope, changes in timing of delivery of products and services, or contract modifications.

For the three and nine months ended September 30, 2022, $340 and $736 was recognized under bill-and-hold arrangements, respectively. For the three and nine months ended September 30, 2021, $270 and $670 was recognized under bill-and-hold arrangements, respectively.

The following table reflects the changes in the Company’s contract liabilities, which is classified as deferred revenue:

	September 30,		December 31,
	2022		2021
Deferred revenues, beginning of period	$	2,864	$	1,661
Unconditional rights to invoice but not yet recognized	1,381		1,770
Revenue recognized from prior period deferred revenue	(1,663)		(567)
Deferred revenues, end of period	$	2,582	$	2,864

Deferred Costs

During the three and nine months ended September 30, 2022, $286 and $1,182 of deferred costs, respectively, were recognized as costs of revenue in the condensed statements of operations. During each of the three and nine months ended September 30, 2021, $211 of deferred costs were recognized as costs of revenue in the condensed statement of operations. Deferred costs were $1,837 and $1,910 as of September 30, 2022 and December 31, 2021, respectively. During the nine month period ended September 30, 2022 and 2021, cost of revenues also includes costs incurred on certain customized

design service contracts that were in excess of the amount expected to be recovered; however, those costs were not material.