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Contract Assets
 12 Months Ended
Dec. 31, 2024
Revenue Recognition [Abstract]  
Contract Assets Revenue from Contracts with Customers
Disaggregation of Revenue
The Company differentiates revenue based on whether the source of revenue is attributable to product sales or service revenue. Product and service revenues include sales to related parties as described in Note 17, “Related Party Transactions.”
Total revenue disaggregated by revenue source is as follows (in thousands):
 Years ended December 31,
 20242023
Revenue:
Products$180,470 $182,695 
Services6,555 5,363 
$187,025 $188,058 
Disaggregation of Cost of Sales
The Company differentiates cost of sales based on whether the cost is attributable to tangible goods sold, cost of services sold or other costs which cannot be directly attributable to either tangible goods or services.
Total cost of sales disaggregated is as follows (in thousands):
 Years ended December 31,
 20242023
Cost of sales:
Tangible goods sold$128,816 $144,720 
Services547 528 
Other18,276 18,547 
$147,639 $163,795 
Other cost of sales represent costs directly associated with the generation of revenue but which cannot be attributed directly to tangible goods sold or services. Examples of other costs of sales are certain personnel costs and equipment rental and insurance costs.
Cost of sales, between external customers and related party, is as follows (in thousands):
 Years ended December 31,
 20242023
Cost of sales:
Cost of sales for external customers$67,205 $64,498 
Cost of sales for related party80,434 99,297 
$147,639 $163,795 
Contract Assets
Contract assets are as follows (in thousands):
December 31, 2024December 31, 2023
Contract assets$83,060 $83,060 
Less accumulated amortization(14,016)(8,404)
Contract assets, net69,044 74,656 
Less current contract assets(5,939)(5,836)
Contract assets, long term$63,105 $68,820 
In connection with entering into the Initial ProFrac Agreement and Amended ProFrac Agreement on February 2, 2022 and May 17, 2022, respectively, as discussed in Note 9, “Debt and Convertible Notes Payable” and Note 17, “Related Party Transactions,” the Company recognized contract assets of $10.0 million and $69.5 million, respectively, and associated fees of $3.6 million. As of December 31, 2024 and December 31, 2023, $63.1 million and $68.8 million, respectively, of the contract assets were classified as long term based upon our estimate of the forecasted revenues from the ProFrac Agreement that will not be realized within the next twelve months of the ProFrac Agreement. The Company’s estimate of the timing of the future contract revenues is evaluated on a quarterly basis.
During the years ended December 31, 2024 and 2023, the Company recognized $5.6 million and $5.0 million, respectively, of contract assets amortization that is recorded as a reduction of the transaction price included in the related party revenue in the consolidated statement of operations. The below table reflects our estimated amortization per year (in thousands) based on the Company’s current forecasted revenues from the ProFrac Agreement.
Years ending December 31,Amortization
2025$5,939 
20268,729 
202710,358 
202810,358 
202910,358 
Thereafter through May 203223,302 
Total contract assets$69,044