Revenue Recognition

6 Months Ended

Jul. 01, 2018

4. Revenue Recognition

Disaggregation of Revenue

In the following table (in thousands), revenue is disaggregated by major product line. The table also includes a reconciliation of the disaggregated revenue with the reportable segments.


		Reportable Segments
		Three Months Ended July 1, 2018
Major Products/Services Lines		Domestic Company-owned restaurants		North America commissaries		North America franchising		International		All others		Total
Company-owned restaurant sales	$	181,379	$	-	$	-	$	2,783	$	-	$	184,162
Commissary sales		-		204,947		-		17,299		-		222,246
Franchise royalties and fees		-		-		24,928		8,987		-		33,915
Other revenues		-		-		-		5,656		22,139		27,795
Eliminations		-		(51,492)		(1,016)		(73)		(7,578)		(60,159)
Total	$	181,379	$	153,455	$	23,912	$	34,652	$	14,561	$	407,959

		Reportable Segments
		Six Months Ended July 1, 2018
Major Products/Services Lines		Domestic Company-owned restaurants		North America commissaries		North America franchising		International		All others		Total
Company-owned restaurant sales	$	371,621	$	-	$	-	$	6,237	$	-	$	377,858
Commissary sales		-		422,534		-		34,978		-		457,512
Franchise royalties and fees		-		-		50,753		17,969		-		68,722
Other revenues		-		-		-		11,143		45,289		56,432
Eliminations		-		(107,366)		(2,035)		(143)		(15,652)		(125,196)
Total	$	371,621	$	315,168	$	48,718	$	70,184	$	29,637	$	835,328

The revenue summarized above is described in Note 2 under the heading “Significant Accounting Policies – Revenue Recognition.”

Contract Balances

The contract liabilities primarily relate to franchise fees which we classify as “Deferred revenue” and customer loyalty program obligations which are classified with “Accrued expenses and other current liabilities.” During the three and six months ended July 1, 2018, the Company recognized $3.1 million and $7.0 million in revenue, respectively, related to deferred revenue and customer loyalty program.

The contract liability balances are included in the following (in thousands):




		July 1, 2018		January 1, 2018		Change
Deferred revenue	$	17,755	$	15,850	$	1,905
Customer loyalty program		15,800		14,724		1,076
Total contract liabilities	$	33,555	$	30,574	$	2,981