Revenue Recognition

3 Months Ended

May 02, 2020

Revenue from Contract with Customer [Abstract]

Note 3 – 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, airborne printers and networking systems used in the flight deck and cabin of military, commercial and business aircraft, (ii) related supplies required in the operation of the hardware, (iii) repairs and maintenance of hardware and (iv) service agreements.

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

Primary geographical markets:


	Three Months Ended
(In thousands)	May 2, 2020		May 4, 2019
United States	$	19,789	$	21,992
Europe		7,450		7,875
Canada		1,428		1,516
Asia		1,009		3,450
Central and South America		954		888
Other		289		460

Total Revenue	$	30,919	$	36,181

Major product types:


	Three Months Ended
(In thousands)	May 2, 2020		May 4, 2019
Hardware	$	8,914	$	12,918
Supplies		19,118		19,727
Service and Other		2,887		3,536

Total Revenue	$	30,919	$	36,181

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 $375,000 and $466,000 at May 2, 2020 and January 31, 2020, respectively, and are recorded as deferred revenue in the condensed consolidated balance sheet.

recognized $225,000 of revenue during the three

month period ended May 2, 2020, related to the deferred revenue balance at January 31, 2020.

Contract Costs

We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. 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 remaining benefit term, which we currently estimate to be

approximately 6 years. The balance of these contract assets at January 31, 2020 was $944,000.

amortized $15,000 of direct costs for the three months ended May 2, 2020 and the balance of deferred incremental direct costs net of accumulated amortization at May 2, 2020 was $929,000, of which $59,000 is reported in other current assets and $870,000 is reported in other assets in the accompanying condensed consolidated balance sheet.