Revenue Recognition

12 Months Ended

Jan. 31, 2020

Revenue from Contract with Customer [Abstract]

Note 2—Revenue Recognition

We derive revenue from the sale of (i) hardware including, digital color label printers and specialty OEM printing systems, portable data acquisition systems and airborne printers used in the flight deck and in the cabin of military, commercial and business aircraft, (ii) related consumable supplies including paper, labels, tags, inks, toners and ribbons, (iii) repairs and maintenance of equipment and (iv) service agreements.

Revenues disaggregated by primary geographic markets and major product types are as follows:

Primary geographical markets:


	Year Ended
(In thousands)	January 31, 2020		January 31, 2019		January 31, 2018
United States	$	83,671	$	83,668	$	69,795
Europe		29,617		31,574		29,948
Asia		8,316		8,207		3,808
Canada		5,719		6,692		5,373
Central and South America		4,145		4,147		3,402
Other		1,978		2,369		1,075

Total Revenue	$	133,446	$	136,657	$	113,401

Major product types:


	Year Ended
(In thousands)	January 31, 2020		January 31, 2019		January 31, 2018
Hardware	$	48,959	$	53,207	$	37,501
Supplies		71,838		71,178		65,265
Service and Other		12,649		12,272		10,635

Total Revenue	$	133,446	$	136,657	$	113,401

Contract Assets and Liabilities

We normally do not have contract assets, which are primarily unbilled accounts receivable that are conditional on something other than the passage of time. Our contract liabilities, which represent billings in excess of revenue recognized, are related to advanced billings for purchased service agreements and extended warranties. Contract liabilities were $466,000 and $373,000 at January 31, 2020 and January 31, 2019, respectively and are recorded as deferred revenue in the consolidated balance sheet. During the year ended January 31, 2020, the Company recognized $361,000 of revenue that was included in the contract liability balance at the beginning of the period.

Contract Costs

We have determined that certain costs related to obtaining sales contracts for our aerospace printer products meet the requirement to be capitalized. These costs are deferred and amortized based on the forecasted number of units sold over the estimated benefit term. The balance of these contract assets at January 31, 2019 was $903,000 of which $109,000 was reported in other current assets and $794,000 was reported in other assets in the consolidated balance sheet. In fiscal 2020, the Company incurred an additional $120,000 in incremental direct costs which were deferred. Amortization of incremental direct costs was $79,000 for the period ended January 31, 2020. The balance of the deferred incremental direct contract costs net of accumulated amortization at January 31, 2020 is $944,000, of which $59,000 was reported in other current assets and $885,000 was reported in other assets in the consolidated balance sheet. The contract costs are expected to be amortized over the estimated remaining period of benefit, which we currently estimate to be approximately 6 years.