REVENUE

6 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

REVENUE

REVENUE

Disaggregation of revenue. Essentially all of our revenues are associated with contracts with customers. A disaggregation of our revenue from contracts with customers by geographic region, by reportable operating segment and by service type is presented below (in thousands):

Geographic area:

	Three Months Ended June 30, 2023						Three Months Ended June 30, 2022
	(unaudited)						(unaudited)
	United States and Canada		Other Countries		Total		United States and Canada		Other Countries		Total
Revenue:
IHT	$	113,013	$	3,727	$	116,740	$	111,541	$	2,583	$	114,124
MS	82,626		40,126		122,752		77,683		29,733		107,416
Total	$	195,639	$	43,853	$	239,492	$	189,224	$	32,316	$	221,540

	Six Months Ended June 30, 2023						Six Months Ended June 30, 2022
	(unaudited)						(unaudited)
	United States and Canada		Other Countries		Total		United States and Canada		Other Countries		Total
Revenue:
IHT	$	211,544	$	7,025	$	218,569	$	204,919	$	4,802	$	209,721
MS	154,657		68,543		223,200		141,614		59,243		200,857
Total	$	366,201	$	75,568	$	441,769	$	346,533	$	64,045	$	410,578

Revenue by Operating segment and service type (in thousands):

	Three Months Ended June 30, 2023
	(unaudited)
	Non-Destructive Evaluation and Testing Services		Repair and Maintenance Services		Heat Treating		Other		Total
Revenue:
IHT	$	94,305	$	219	$	15,717	$	6,499	$	116,740
MS	—		122,022		211		519		122,752
Total	$	94,305	$	122,241	$	15,928	$	7,018	$	239,492

	Three Months Ended June 30, 2022
	(unaudited)
	Non-Destructive Evaluation and Testing Services		Repair and Maintenance Services		Heat Treating		Other		Total
Revenue:
IHT	$	91,701	$	115	$	15,787	$	6,521	$	114,124
MS	—		106,731		56		629		107,416
Total	$	91,701	$	106,846	$	15,843	$	7,150	$	221,540

	Six Months Ended June 30, 2023
	(unaudited)
	Non-Destructive Evaluation and Testing Services		Repair and Maintenance Services		Heat Treating		Other		Total
Revenue:
IHT	$	175,911	$	222	$	29,445	$	12,991	$	218,569
MS	—		221,860		489		851		223,200
Total	$	175,911	$	222,082	$	29,934	$	13,842	$	441,769

	Six Months Ended June 30, 2022
	(unaudited)
	Non-Destructive Evaluation and Testing Services		Repair and Maintenance Services		Heat Treating		Other		Total
Revenue:
IHT	$	168,152	$	139	$	29,626	$	11,804	$	209,721
MS	—		198,501		113		2,243		200,857
Total	$	168,152	$	198,640	$	29,739	$	14,047	$	410,578

For additional information on our reportable operating segments and geographic information, refer to Note 15 - Segment and Geographic Disclosures.

Contract balances. The timing of revenue recognition, billings, and cash collections results in trade accounts receivable, contract assets and contract liabilities on the condensed consolidated balance sheets. Trade accounts receivable include billed and unbilled amounts currently due from customers and represent unconditional rights to receive consideration. The amounts due are stated at their net estimated realizable value. Refer to Note 4 - Receivables for additional information on our trade receivables and the allowance for credit losses.

Contract costs. We recognize the incremental costs of obtaining contracts as selling, general and administrative expenses when incurred if the amortization period of the asset that otherwise would have been recognized is one year or less. Costs to fulfill a contract are recorded as assets if they relate directly to a contract or a specific anticipated contract, the costs to generate or enhance resources that will be used in satisfying performance obligations in the future, and the costs are expected to be recovered. Costs to fulfill a contract recognized as assets primarily consist of labor and material costs and generally relate to engineering and set-up costs incurred prior to when the satisfaction of performance obligations begins. Assets recognized for

costs to fulfill a contract are included in the “Prepaid expenses and other current assets” line of the condensed consolidated balance sheets and were not material as of June 30, 2023 and December 31, 2022. Such assets are recognized as expenses as we transfer the related goods or services to the customer. All other costs to fulfill a contract are expensed as incurred.

Remaining performance obligations. As permitted by ASC 606, Revenue from Contracts with Customers, we have elected not to disclose information about remaining performance obligations where (i) the performance obligation is part of a contract that has an original expected duration of one year or less or (ii) when we recognize revenue from the satisfaction of the performance obligation in accordance with the right-to-invoice practical expedient, which permits us to recognize revenue in the amount to which we have a right to invoice the customer if that amount corresponds directly with the value to the customer of our performance completed to date. As most of our contracts with customers are short-term in nature and billed on a time and material basis, there were no material amounts of remaining performance obligations as of June 30, 2023 and December 31, 2022.