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Revenue Recognition
 6 Months Ended
Jun. 30, 2024
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
The majority of our revenues relate to customer orders that typically contain a single commitment of goods or services which have lead times under a year. More complex contracts with our customers typically have longer lead times and multiple commitments of goods and services, including any combination of designing, developing, manufacturing, modifying, installing and commissioning of flow management equipment and providing services and parts related to the performance of such products. Control transfers over time when the customer is able to direct the use of and obtain substantially all of the benefits of our work as we perform. Service-related revenues do not typically represent a significant portion of contracts with our customers and do not meet the thresholds requiring separate disclosure.
Revenue from products and services transferred to customers over time accounted for approximately 17% and 15% of total revenue for the three month period ended June 30, 2024 and 2023, respectively, and 17% and 15% for the six month period ended June 30, 2024 and 2023, respectively. Our primary method for recognizing revenue over time is the percentage of completion ("POC") method. If control does not transfer over time, then control transfers at a point in time. For both POC and point in time methods, we recognize revenue at the level of each performance obligation based on the evaluation of certain indicators of control transfer, such as title transfer, risk of loss transfer, customer acceptance and physical possession. Revenue from products and services transferred to customers at a point in time accounted for approximately 83% and 85% of total revenue for the three-month period ended June 30, 2024 and 2023, respectively, and 83% and 85% for the six-month period ended June 30, 2024 and 2023, respectively. Refer to Note 2, "Revenue Recognition," to our consolidated financial statements included in our 2023 Annual Report for a more comprehensive discussion of our policies and accounting practices of revenue recognition.
Disaggregated Revenue
We conduct our operations through two business segments based on the type of product and how we manage the business:
•Flowserve Pumps Division ("FPD") designs and manufactures custom, highly engineered pumps, pre-configured industrial pumps, pump systems, mechanical seals, auxiliary systems and replacement parts and related services; and
•FCD designs, manufactures and distributes a broad portfolio of engineered-to-order and configured-to-order isolation valves, control valves, valve automation products and related equipment.
Our revenue sources are derived from our original equipment manufacturing and our aftermarket sales and services. Our original equipment revenues are generally related to originally designed, manufactured, distributed and installed equipment that can range from pre-configured, short-cycle products to more customized, highly engineered equipment ("Original Equipment"). Our aftermarket sales and services are derived from sales of replacement equipment, as well as maintenance, advanced diagnostic, repair and retrofitting services ("Aftermarket"). Each of our two business segments generate Original Equipment and Aftermarket revenues.
The following tables present our customer revenues disaggregated by revenue source:
Three Months Ended June 30, 2024
(Amounts in thousands)FPDFCDTotal
Original Equipment$301,866 $264,504 $566,370 
Aftermarket508,747 81,775 590,522 
$810,613 $346,279 $1,156,892 
Three Months Ended June 30, 2023
FPDFCDTotal
Original Equipment$284,053 $233,770 $517,823 
Aftermarket480,798 81,755 562,553 
$764,851 $315,525 $1,080,376 
Six Months Ended June 30, 2024
(Amounts in thousands)FPDFCDTotal
Original Equipment$586,904 $508,067 $1,094,971 
Aftermarket992,472 156,928 1,149,400 
$1,579,376 $664,995 $2,244,371 
Six Months Ended June 30, 2023
FPDFCDTotal
Original Equipment$536,785 $444,522 $981,307 
Aftermarket927,545 151,829 1,079,374 
$1,464,330 $596,351 $2,060,681 
Our customer sales are diversified geographically. The following tables present our revenues disaggregated by geography, based on the shipping addresses of our customers:
Three Months Ended June 30, 2024
(Amounts in thousands)FPDFCDTotal
North America(1)$342,678 $143,402 $486,080 
Latin America(2)72,948 6,116 79,064 
Middle East and Africa 134,652 50,627 185,279 
Asia Pacific105,832 87,036 192,868 
Europe154,503 59,098 213,601 
$810,613 $346,279 $1,156,892 
Three Months Ended June 30, 2023
FPDFCDTotal
North America(1)$317,994 $143,446 $461,440 
Latin America(2)63,107 7,190 70,297 
Middle East and Africa130,158 36,536 166,694 
Asia Pacific110,390 72,510 182,900 
Europe143,202 55,843 199,045 
$764,851 $315,525 $1,080,376 
Six Months Ended June 30, 2024
(Amounts in thousands)FPDFCDTotal
North America(1)$653,143 $272,405 $925,548 
Latin America(2)143,334 11,150 154,484 
Middle East and Africa 270,915 96,854 367,769 
Asia Pacific212,127 163,483 375,610 
Europe299,857 121,103 420,960 
$1,579,376 $664,995 $2,244,371 
Six Months Ended June 30, 2023
FPDFCDTotal
North America(1)$600,258 $269,124 $869,382 
Latin America(2)127,102 15,055 142,157 
Middle East and Africa244,524 64,931 309,455 
Asia Pacific223,774 140,342 364,116 
Europe268,672 106,899 375,571 
$1,464,330 $596,351 $2,060,681 
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(1) North America represents the United States and Canada.
(2) Latin America includes Mexico.

On June 30, 2024, the aggregate transaction price allocated to unsatisfied (or partially unsatisfied) performance obligations related to contracts having an original expected duration in excess of one year was approximately $775 million. We estimate recognition of approximately $301 million of this amount as revenue in the remainder of 2024 and an additional $474 million in 2025 and thereafter.
Contract Balances
We receive payment from customers based on a contractual billing schedule and specific performance requirements as established in our contracts. We record billings as accounts receivable when an unconditional right to consideration exists. A contract asset represents revenue recognized in advance of our right to bill the customer under the terms of a contract. A contract liability represents our contractual billings in advance of revenue recognized for a contract.
The following tables present beginning and ending balances of contract assets and contract liabilities, current and long-term, for the six months ended June 30, 2024 and 2023:

(Amounts in thousands) Contract Assets, net (Current)Long-term Contract Assets, net(1)Contract Liabilities (Current)Long-term Contract Liabilities(2)
Beginning balance, January 1, 2024$280,228 $1,034 $287,697 $1,543 
Revenue recognized that was included in contract liabilities at the beginning of the period— — (163,330)(174)
Revenue recognized in the period in excess of billings400,743 — — — 
Billings arising during the period in excess of revenue recognized— — 175,447 — 
Amounts transferred from contract assets to receivables(380,362)(437)— — 
Currency effects and other, net(12,933)332 (6,460)(57)
Ending balance, June 30, 2024$287,676 $929 $293,354 $1,312 


(Amounts in thousands)Contract Assets, net (Current)Long-term Contract Assets, net(1)Contract Liabilities (Current)Long-term Contract Liabilities(2)
Beginning balance, January 1, 2023$233,457 $297 $256,963 $1,059 
Revenue recognized that was included in contract liabilities at the beginning of the period— — (169,722)— 
Revenue recognized in the period in excess of billings301,548 — — — 
Billings arising during the period in excess of revenue recognized— — 176,491 661 
Amounts transferred from contract assets to receivables(310,232)(301)— — 
Currency effects and other, net2,863 473 5,993 5,851 
Ending balance, June 30, 2023$227,636 $469 $269,725 $7,571 
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(1) Included in other assets, net.
(2) Included in retirement obligations and other liabilities.