REVENUE

Revenue By Category

The following table presents Revenue disaggregated by business segment, geographical region, and timing of transfer of goods or services.



			Three Months Ended
(in thousands)			Mar 31, 2019		Mar 31, 2018		Dec 31, 2018
Business Segment:
	Energy Services and Products
		Remotely Operated Vehicles	$	100,346	$	85,594	$	96,736
		Subsea Products	128,844		126,688		129,509
		Subsea Projects	89,728		56,860		89,295
		Asset Integrity	60,689		61,288		62,830
	Total Energy Services and Products		379,607		330,430		378,370
	Advanced Technologies		114,279		85,983		116,725
		Total	$	493,886	$	416,413	$	495,095



(in thousands)
Geographic Operating Areas:			Three Months Ended
	Foreign:		Mar 31, 2019		Mar 31, 2018		Dec 31, 2018
		Africa	$	87,106	$	55,087	$	71,237
		United Kingdom	53,298		45,319		50,304
		Norway	42,466		39,042		42,731
		Asia and Australia	41,426		38,946		41,685
		Brazil	17,763		18,828		17,161
		Other	21,222		19,639		23,200
	Total Foreign		263,281		216,861		246,318
	United States		230,605		199,552		248,777
Total			$	493,886	$	416,413	$	495,095



Timing of Transfer of Goods or Services:
	Revenue recognized over time	$	461,245	$	374,667	$	465,008
	Revenue recognized at a point in time	32,641		41,746		30,087
Total		$	493,886	$	416,413	$	495,095

Contract Balances

Our contracts with milestone payments have, in the aggregate, a significant impact on the Contract asset and the Contract liability balances. Milestones are contractually agreed with customers and relate to significant events across the contract lives. Some milestones are achieved before revenue is recognized, resulting in a Contract liability, other milestones are achieved after revenue is recognized resulting in a Contract asset.

Our payment terms consist of those services billed regularly as provided and those products delivered at a point in time, which are invoiced after the performance obligation is satisfied. Our product and service contracts with milestone payments due at agreed progress points during the contract are invoiced when those milestones are reached, which may differ from the timing of revenue recognition.

During the three months ended March 31, 2019, Contract assets decreased by $35 million from its opening balance due to billings of $519 million, which exceeded accrued revenue of $484 million. Contract liabilities decreased $6.5 million from its opening balance, due to revenue recognition of $15 million less deferrals of milestone payments that totaled $8.2 million. There were no cancellations, impairments or other significant impacts in the period that relate to other categories of explanation.

Performance Obligations

As of March 31, 2019, the aggregate amount of the transaction price allocated to remaining performance obligations was $364 million. We expect to recognize revenue for the remaining performance obligations of $272 million over the next twelve months.

The aggregate amount of transaction price allocated to remaining performance obligations that were unsatisfied (or partially unsatisfied) as of March 31, 2019 are noted above. In arriving at this value, we have used two expedients available to us and are not disclosing amounts in relation to performance obligations: (1) that are part of contracts with an original expected duration of one year or less; or (2) on contracts where we recognize revenue in line with the billing.

Due to the nature of our service contracts in our Remotely Operated Vehicle, Subsea Projects, Asset Integrity and Advanced Technologies segments, the majority of our contracts either have initial contract terms of one year or less or have customer option cancellation clauses that lead us to consider the original expected duration of one year or less.

In our Subsea Products and Advanced Technologies segments, we have long-term contracts that extend beyond one year, and these make up the majority of the balance reported. We also have shorter-term product contracts with an expected original duration of one year or less that have been excluded.

Where appropriate, we have made estimates within the transaction price of elements of variable consideration within the contracts and constrained those amounts to a level where we consider that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The amount of revenue recognized in the three months ended March 31, 2019, which was associated with performance obligations completed or partially completed in prior periods was not significant.

As of March 31, 2019, there was no outstanding liability balance for refunds or returns due to the nature of our contracts and the services and products we provide. Our warranties are limited to assurance warranties that are of a standard length and are not considered to be a material right. The majority of our contracts consist of a single performance obligation. When there are multiple obligations, we look for observable evidence of stand-alone selling prices on which to base the allocation. This involves judgment as to the appropriateness of the observable evidence relating to the facts and circumstances of the contract. If we do not have observable evidence, we estimate stand-alone selling prices by taking a cost plus margin approach, using typical margins from the type of product or service, customer and regional geography involved.

Costs to Obtain or Fulfill a Contract

In line with the available expedient, we capitalize costs to obtain a contract when those amounts are significant and the contract is expected at inception to exceed one year in duration; otherwise, the costs are expensed in the period when incurred. Costs to obtain a contract primarily consist of bid and proposal costs, which are incremental to our fixed costs. There was no balance or amortization of Costs to obtain a contract in the current reporting period.

Costs to fulfill a contract primarily consist of certain mobilization costs incurred to provide services or products to our customers. These costs are deferred and amortized over the period of contract performance. The closing balance of Costs to fulfill a contract was $13 million as of both March 31, 2019 and December 31, 2018. For the three-month periods ended March 31, 2019 and 2018, $2.6 million and $1.3 million of amortization expense was recorded, respectively. No impairment costs were recognized.