Note 3 - Revenue From Contracts With Customers

9 Months Ended

Sep. 26, 2020

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

Disaggregation of revenue

The following tables provide information about revenue from contracts with customers disaggregated by major class of revenue, revenue by channel, and by geographical market, based on ship-to location of the end customer, where available, and ship-to location of distributor otherwise:

Major Class of Revenue	Three Months Ended								Nine Months Ended
	September 26,				September 28,				September 26,				September 28,
(In thousands)	2020				2019				2020				2019
Product	$	96,650	94	%	$	97,477	94	%	$	285,871	95	%	$	287,185	95	%
Licensing and services		6,392	6	%		5,992	6	%		15,076	5	%		16,671	5	%
Total revenue	$	103,042	100	%	$	103,469	100	%	$	300,947	100	%	$	303,856	100	%

Revenue by Channel	Three Months Ended								Nine Months Ended
	September 26,				September 28,				September 26,				September 28,
(In thousands)	2020				2019				2020				2019
Product revenue - Distributors	$	84,409	82	%	$	84,135	81	%	$	245,016	81	%	$	248,234	82	%
Product revenue - Direct		12,241	12	%		13,342	13	%		40,855	14	%		38,951	13	%
Licensing and services revenue		6,392	6	%		5,992	6	%		15,076	5	%		16,671	5	%
Total revenue	$	103,042	100	%	$	103,469	100	%	$	300,947	100	%	$	303,856	100	%

Revenue by Geographical Market	Three Months Ended								Nine Months Ended
	September 26,				September 28,				September 26,				September 28,
(In thousands)	2020				2019				2020				2019
United States	$	10,455	10	%	$	9,296	9	%	$	33,634	11	%	$	32,352	11	%
Other Americas		4,857	5	%		2,838	3	%		12,772	4	%		9,518	3	%
Americas		15,312	15	%		12,134	12	%		46,406	15	%		41,870	14	%
China		58,122	56	%		57,301	55	%		154,086	51	%		157,648	52	%
Taiwan		7,505	7	%		6,796	7	%		24,957	8	%		14,147	5	%
Japan		4,346	4	%		10,262	10	%		18,780	6	%		31,534	10	%
Other Asia		9,766	10	%		5,285	5	%		25,169	9	%		22,171	7	%
Asia		79,739	77	%		79,644	77	%		222,992	74	%		225,500	74	%
Europe		7,991	8	%		11,691	11	%		31,549	11	%		36,486	12	%
Total revenue	$	103,042	100	%	$	103,469	100	%	$	300,947	100	%	$	303,856	100	%

Contract balances

Our contract assets relate to our rights to consideration for licenses and royalties due to us as a member of the HDMI consortium, with collection dependent on events other than the passage of time, such as collection of licenses and royalties from customers by the HDMI licensing agent. The balance results primarily from the amount of estimated revenue related to HDMI that we have recognized to date, but which has not yet been collected by the agent. Contract assets are included in Prepaid expenses and other current assets on our Consolidated Balance Sheets. The following table summarizes activity during the first nine months of fiscal 2020:

(In thousands)
Contract assets as of December 28, 2019	$	5,569
Revenues recorded during the period		11,660
Transferred to Accounts receivable or collected		(12,091	)
Contract assets as of September 26, 2020	$	5,138

Contract liabilities are included in Accounts payable and accrued expenses on our Consolidated Balance Sheets. The following table summarizes activity during the first nine months of fiscal 2020:

(In thousands)
Contract liabilities as of December 28, 2019	$	2,313
Accruals for estimated future stock rotation and scrap returns		4,474
Less: Release of accruals for recognized stock rotation and scrap returns		(2,571	)
Prepayment for performance obligations expected to be satisfied within three months		336
Less: Revenue recognized on satisfaction of performance obligations		(179	)
Contract liabilities as of September 26, 2020	$	4,373

The impact to revenue from the release of accruals for recognized stock rotation and scrap returns was offset by the processing of return merchandise authorizations totaling approximately $3.0 million, yielding a net revenue reduction of approximately $0.4 million for the first nine months of 2020.