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Revenue from Contracts with Customers
 6 Months Ended
Jun. 30, 2024
Revenue from Contracts with Customers [Abstract]  
Revenue from Contracts with Customers

5. Revenue from Contracts with Customers

 

The Company markets and sells its products through e-commerce online channels, retail brick-and-mortar wholesale partners, Purple showrooms, and third-party online retailers. Revenue is recognized when the Company satisfies its performance obligations under the contract which involves transferring the promised products to the customer, subject to shipping terms.

 

Disaggregated Revenue

 

The Company classifies revenue into two sales categories: direct-to-consumer (“DTC”) and wholesale. The DTC category is comprised of the Company’s e-commerce channel that sells directly to consumers who purchase online and through our contact center, and the Purple showrooms channel that sells directly to consumers who purchase at a showroom location. The wholesale channel includes all product sales to our retail brick and mortar wholesale partners where consumers make purchases at their retail locations or through their online channels. The Company classifies products into two major types: sleep products and other. Sleep products include mattresses, platforms, adjustable bases, mattress protectors, pillows and sheets. Other products include cushions and various other products.

 

The following tables present the Company’s net revenue disaggregated by sales category and product type (in thousands):

 

   Three Months Ended
June 30,		   Six Months Ended
June 30,		 
Sales Category  2024   2023   2024   2023 
DTC  $66,863   $68,056   $133,078   $134,361 
Wholesale   53,408    49,826    107,226    90,248 
Revenues, net  $120,271   $117,882   $240,304   $224,609 

 

   Three Months Ended
June 30,		   Six Months Ended
June 30,		 
Product Type  2024   2023   2024   2023 
Sleep products  $116,977   $114,423   $234,076   $217,926 
Other   3,294    3,459    6,228    6,683 
Revenues, net  $120,271   $117,882   $240,304   $224,609 

 

Contract Balances

 

Payments for sale of products through the e-commerce online channel, third-party online retailers, Purple showrooms and contact center are collected at point of sale in advance of shipping the products. Amounts received for unshipped products are recorded as customer prepayments. Customer prepayments totaled $4.7 million and $5.7 million at June 30, 2024 and December 31, 2023, respectively. During the three months ended June 30, 2024 and 2023, the Company recognized all revenue that was deferred in customer prepayments at March 31, 2024 and 2023, respectively.