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Revenue from Contracts with Customers
 6 Months Ended
Mar. 30, 2024
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
Revenue is recognized over time for arrangements with customers for which: (i) the Company's performance does not create an asset with an alternative use to the Company, and (ii) the Company has an enforceable right to payment, including reasonable profit margin, for performance completed to date. Revenue recognized over time is estimated based on costs incurred to date plus a reasonable profit margin. If either of the two conditions noted above are not met to recognize revenue over time, revenue is recognized following the transfer of control of such products to the customer, which typically occurs upon shipment or delivery depending on the terms of the underlying arrangement.
The Company recognizes revenue when a contract exists and when, or as, it satisfies a performance obligation by transferring control of a product or service to a customer. Contracts are accounted for when they have approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer.
The Company generally enters into a master services arrangement that establishes the framework under which business will be conducted. These arrangements represent the master terms and conditions of the Company's services that apply to individual orders, but they do not commit the customer to work with, or to continue to work with, the Company nor do they obligate the customer to any specific volume or pricing of purchases. Moreover, these terms can be amended in appropriate situations.
Customer purchase orders are received for specific quantities with predominantly fixed pricing and delivery requirements. Thus, for the majority of our contracts, there is no guarantee of any revenue to the Company until a customer submits a purchase order. As a result, the Company generally considers its arrangement with a customer to be the combination of the master services arrangement and the purchase order. Most of the Company's arrangements with customers create a single performance obligation as the promise to transfer the individual manufactured product or service is capable of being distinct.
The Company’s performance obligations are satisfied over time as work progresses or at a point in time. A performance obligation is satisfied over time if the Company has an enforceable right to payment, including a reasonable profit margin.
Determining if an enforceable right to payment includes a reasonable profit margin requires judgment and is assessed on a contract-by-contract basis.
Generally, there are no subjective customer acceptance requirements or further obligations related to goods or services provided; if such requirements or obligations exist, then a sale is recognized at the time when such requirements are completed and such obligations are fulfilled.
The Company does not allow for a general right of return. Net sales include amounts billed to customers for shipping and handling and out-of-pocket expenses. The corresponding shipping and handling costs and out-of-pocket expenses are included in cost of sales. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from net sales.
Contract Costs
For contracts requiring over time revenue recognition, the selection of the method to measure progress toward completion requires judgment and is based on the nature of the products or services to be provided. The Company uses a cost-based input measurement of progress because it best depicts the transfer of assets to the customer, which occurs as costs are incurred during the manufacturing process or as services are rendered. Under the cost-based measure of progress, the extent of progress toward completion is measured based on the costs incurred to date.
There were no other costs to obtain or fulfill customer contracts.
Disaggregated Revenue
The table below includes the Company’s revenue for the fiscal years indicated disaggregated by geographic reportable segment and market sector (in thousands):
Three Months Ended
March 30, 2024
Reportable Segment:
AMERAPACEMEATotal
Market Sector:
Healthcare/Life Sciences$162,816 $157,015 $58,580 $378,411 
Industrial71,007 275,494 71,683 418,184 
Aerospace/Defense84,677 62,356 23,272 170,305 
     External revenue318,500 494,865 153,535 966,900 
Inter-segment sales3,282 26,127 1,227 30,636 
    Segment revenue$321,782 $520,992 $154,762 $997,536 
Three Months Ended
April 1, 2023
Reportable Segment:
AMERAPACEMEATotal
Market Sector:
Healthcare/Life Sciences$228,245 $206,442 $52,683 $487,370 
Industrial98,686 312,840 27,755 439,281 
Aerospace/Defense76,731 47,445 19,996 144,172 
     External revenue403,662 566,727 100,434 1,070,823 
Inter-segment sales4,144 20,543 1,360 26,047 
    Segment revenue$407,806 $587,270 $101,794 $1,096,870 
Six Months Ended
March 30, 2024
Reportable Segment:
AMERAPACEMEATotal
Market Sector:
Healthcare/Life Sciences$328,423 $321,737 $109,184 $759,344 
Industrial154,908 580,252 117,683 852,843 
Aerospace/Defense167,398 123,048 46,874 337,320 
     External revenue650,729 1,025,037 273,741 1,949,507 
Inter-segment sales4,750 48,439 2,959 56,148 
    Segment revenue$655,479 $1,073,476 $276,700 $2,005,655 
Six Months Ended
April 1, 2023
Reportable Segment:
AMERAPACEMEATotal
Market Sector:
Healthcare/Life Sciences$443,626 $429,732 $101,879 $975,237 
Industrial201,713 663,424 46,226 911,363 
Aerospace/Defense144,753 93,099 40,296 278,148 
     External revenue790,092 1,186,255 188,401 2,164,748 
Inter-segment sales7,376 42,919 2,766 53,061 
    Segment revenue$797,468 $1,229,174 $191,167 $2,217,809 
For both the three and six months ended March 30, 2024, approximately 83% of the Company's revenue was recognized as products and services transferred over time. For the three and six months ended April 1, 2023, approximately 80% and 81%, respectively, of the Company's revenue was recognized as products and services transferred over time.
Contract Balances
The timing of revenue recognition, billings and cash collections results in billed accounts receivable, contract assets and deferred revenue on the Company’s accompanying Condensed Consolidated Balance Sheets.
Contract Assets: For performance obligations satisfied at a point in time, billing occurs subsequent to revenue recognition, at which point the customer has been billed and the resulting asset is recorded within accounts receivable. For performance obligations satisfied over time as work progresses, the Company has an unconditional right to payment, which results in the recognition of contract assets. The following table summarizes the activity in the Company's contract assets during the six months ended March 30, 2024 and April 1, 2023 (in thousands):
Six Months Ended
March 30, 2024April 1, 2023
Contract assets, beginning of period$142,297 $138,540 
Revenue recognized during the period1,625,857 1,743,054 
Amounts collected or invoiced during the period(1,636,980)(1,748,565)
Contract assets, end of period$131,174 $133,029 
Deferred Revenue: Deferred revenue is recorded when consideration is received from a customer prior to transferring goods or services to the customer under the terms of the contract, which is included in advanced payments from customers on Condensed Consolidated Balance Sheets. As of March 30, 2024 and September 30, 2023, the balance of advance payments from customers attributable to deferred revenue was $165.3 million and $158.7 million, respectively. The advance payment is not considered a significant financing component because it is used to meet working capital demands that can be higher in the early stages of a contract and to protect the company from the other party failing to adequately complete some or all of its obligations under the
contract. Deferred revenue is recognized into revenue when all revenue recognition criteria are met. For performance obligations satisfied over time, recognition will occur as work progresses; otherwise deferred revenue will be recognized based upon shipping terms.