DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS

NOTE 8. DEFERRED REVENUE AND REMAINING PERFORMANCE OBLIGATIONS

Deferred revenue, consisting of amounts received for products and services not yet delivered or earned, was as follows as of September 30, 2023 and December 31, 2022 (in thousands):

	September 30,		December 31,
	2023		2022
Products and services not yet delivered	$	596	$	547

We recognized $0.2 million of revenue that was included in the beginning contract liabilities balances for each of the three months ended September 30, 2023 and 2022 and $0.5 million and $0.4 million for the nine months ended September 30, 2023 and 2022, respectively. No material amount of revenue recognized during the period was from performance obligations satisfied in prior periods.

Transaction Price Allocated to Remaining Performance Obligations

As of September 30, 2023, $5.7 million of revenue is expected to be recognized from remaining performance obligations. This balance primarily relates to product shipments for reagents sold to customers under sales-type lease agreements. These agreements have between two and four year terms and revenue is recognized as reagents are shipped, typically on a straight-line basis. The remaining balance relates to executed service contracts that begin as warranty periods expire. These service contracts typically provide a one to four year term and revenue is recognized on a straight-line basis.

The Company elects not to disclose the value of unsatisfied performance obligations for (i) contracts with an expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

Commercial Agent Relationship with BD

The Company has entered into an exclusive commercial agreement with BD to act as the Company’s agent and representative. Exclusivity fees paid to the Company are amortized on a forecast basis as an offset to sales, general, and administrative expense. Agent fees paid to BD correspond with periodic sales and are expensed to sales, general, and administrative expense. The following table presents this information for the three and nine months ended September 30, 2023 (in thousands):

	Three Months Ended		Nine Months Ended
	September 30, 2023
Exclusivity fees received	$	—	$	750
Amortized exclusivity fees	(108)		(750)
Agent fees incurred	271		782
Net expense	$	163	$	32