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Revenue, Contract Assets and Contract Liabilities
 3 Months Ended
Mar. 31, 2025
Revenue, Contract Assets and Contract Liabilities  
Revenue, Contract Assets and Contract Liabilities

Note 5 – Revenue, Contract Assets and Contract Liabilities

The Company’s contracts with customers generally have performance obligations and a schedule of non-refundable cancellation obligations. Performance obligations typically fall into one of three categories, product shipment, burner performance tests and engineering design. Customer payment milestones are unique to individual contracts and may occur prior to completion of performance obligations. Customer payment terms typically range between thirty and sixty days from the date of billing. Our customer contracts typically have a duration of less than twelve months. Delays in contract performance, if any, typically occur as a result of customer onsite project delays outside of our control.

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The Company recognized $401 thousand of revenues and $205 thousand of cost of goods sold during the three months ended March 31, 2025. The revenue and cost of goods sold predominantly relate to multiple spare parts orders for a single customer. Additionally, the Company successfully completed an engineering study referred herein as a

Computational Fluid Dynamic analysis (“CFD”), and sold a single boiler burner. These products and services constitute performance obligations.

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The Company recognized $1,102 thousand of revenues and $665 thousand of cost of goods sold during the three months ended March 31, 2024. The revenue and cost of goods sold predominantly relate to the Company’s process burner product line. The Company delivered multiple burners in connection with a single customer order, successfully completed an engineering study and a CFD analysis, and fulfilled multiple spare parts orders. These products and services constitute performance obligations.

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The Company had contract assets of $150 thousand and $194 thousand at March 31, 2025 and December 31, 2024, respectively. The Company had contract liabilities of $887 thousand and $73 thousand at March 31, 2025 and December 31, 2024, respectively. Of the $73 thousand contract liabilities balance at December 31, 2024, the Company recognized revenue of $23 thousand during the three months ended March 31, 2025.