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REVENUE
 6 Months Ended
Jun. 30, 2023
Revenue from Contract with Customer [Abstract]  
REVENUE

NOTE 10—REVENUE

 

The following table disaggregates the Company’s revenue for the six-month and three-month periods ended June 30, 2023 and 2022 (in thousands):

 

   Hardware   Monitoring   Total 
Six months ended June 30, 2023:               
PG Segment  $1,237   $1,959   $3,196 
CP Segment   396    130    526 
Total Revenue  $1,633   $2,089   $3,722 

 

   Hardware   Monitoring   Total 
Six months ended June 30, 2022:               
PG Segment  $1,002   $1,823   $2,825 
CP Segment   414    133    547 
Total Revenue  $1,416   $1,956   $3,372 

 

   Hardware   Monitoring   Total 
Three months ended June 30, 2023:               
PG Segment  $688   $1,001   $1,689 
CP Segment   220    64    284 
Total Revenue  $908   $1,065   $1,973 

 

   Hardware   Monitoring   Total 
Three months ended June 30, 2022:               
PG Segment  $479   $901   $1,380 
CP Segment   176    65    241 
Total Revenue  $655   $966   $1,621 

 

Deferred revenue activity for the six months ended June 30, 2023 can be seen in the table below (in thousands):

 

   Hardware   Monitoring   Total 
Balance at December 31, 2022  $3,751   $2,420   $6,171 
Additions during the period   1,278    2,200    3,478 
Recognized as revenue   (1,192)   (2,090)   (3,282)
Balance at June 30, 2023  $3,837   $2,530   $6,367 
                
Amounts to be recognized as revenue in the twelve-month-period ending:               
June 30, 2024  $2,099    2,055    4,154 
June 30, 2025   1,312    471    1,783 
June 30, 2026 and thereafter   426    4    430 
   $3,837    2,530    6,367 

 

 

Other revenue of $440,000 was related to customized units, accessories, repairs, and other miscellaneous charges that are recognized to revenue when sold and are not deferred.

 

The amount of hardware revenue recognized during the six months ended June 30, 2023 that was included in deferred revenue at the beginning of the fiscal year was $1,018,000. The amount of monitoring revenue during the six months ended June 30, 2023 that was included in deferred revenue at the beginning of the fiscal year was $1,472,000.

 

Deferred charges relate only to the sale of equipment. Deferred charges activity for the six months ended June 30, 2023 can be seen in the table below (in thousands):

 

      
Balance at December 31, 2022  $1,694 
Additions, net of adjustments, during the period   496 
Recognized as COGS   (540)
Balance at June 30, 2023  $1,650 
      
Amounts to be recognized as COGS in the twelve-month-period ending:     
June 30, 2024  $917 
June 30, 2025   563 
June 30, 2026 and thereafter   170 
   $1,650 

 

Data costs paid to AT&T and the COGS related to sales of upgrade kits, accessories and repairs of $376,000 in the aggregate are expensed as incurred and are not deferred.

 

The following table provides a reconciliation of the Company’s sales commissions contract assets for the six-month period ended June 30, 2023 (in thousands):

 

   Hardware   Monitoring   Total 
Balance at December 31, 2022  $319   $80   $399 
Additions during the period   115    30    145 
Amortization of sales commissions   (97)   (17)   (114)
Balance at June 30, 2023  $337    93    430 

 

The capitalized sales commissions are included in other current assets ($218,000) and other assets ($212,000) in the Company’s unaudited condensed consolidated balance sheets as of June 30, 2023. The capitalized sales commissions are included in other current assets ($196,000) and other assets ($203,000) in the Company’s condensed consolidated balance sheet at December 31, 2022.

 

Amounts to be recognized as sales commission expense in the twelve-month-period ending:

 

      
June 30, 2024  $218 
June 30, 2025   145 
June 30, 2026 and thereafter   67 
Total  $430 

 

The contract assets of deferred COGS and deferred sales commissions are subject to review under ASU 2016-13, see Notes 2 and 4; however, no credit losses on contract assets are expected based on the Company’s implementation of ASU 2016-13.