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Contract Assets
 3 Months Ended
Mar. 31, 2025
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 16, “Related Party Transactions.”
Total revenue disaggregated by revenue source is as follows (in thousands):
 Three months ended March 31,
 20252024
Revenue:
Products$53,625 $39,106 
Services1,737 1,268 
$55,362 $40,374 
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):
 Three months ended March 31,
 20252024
Cost of sales:
Tangible goods sold$38,232 $27,025 
Services179 94 
Other4,502 4,434 
$42,913 $31,553 
Other cost of sales represents costs directly associated with the generation of revenue that 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, disaggregated between external customers and related party, is as follows (in thousands):
 Three months ended March 31,
 20252024
Cost of sales:
Cost of sales for external customers$21,660 $12,952 
Cost of sales for related party21,253 18,601 
$42,913 $31,553 
Contract Assets
Contract assets are as follows (in thousands):
March 31, 2025December 31, 2024
Contract assets$83,060 $83,060 
Less accumulated amortization(15,497)(14,016)
Contract assets, net67,563 69,044 
Less current contract assets(5,782)(5,939)
Contract assets, long term$61,781 $63,105 
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 16, “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 March 31, 2025 and December 31, 2024, $61.8 million and $63.1 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 three months ended March 31, 2025 and 2024, the Company recognized $1.5 million and $1.3 million, respectively, of contract assets amortization that is recorded as a reduction of the transaction price included in 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 (excluding first three months)
$4,213 
20268,740 
202710,404 
202810,404 
202910,404 
Thereafter through May 203223,398 
Total contract assets$67,563