Quarterly report pursuant to Section 13 or 15(d)

Note 2 - Revenue Recognition

Note 2 - Revenue Recognition

3 Months Ended

Sep. 30, 2018

Revenue from Contract with Customer [Text Block]

ote

Revenue Recognition

Consumables revenues consist of single-use products and are recognized at a point in time following the transfer of control of such products to the customer, which generally occurs upon shipment. Instruments revenues typically consist of longer-lived assets that, for the substantial majority of sales, are recognized at a point in time in a manner similar to consumables. Service revenues consist of extended warranty contracts, post contract support (“PCS”), and custom development projects that are recognized over time as customers receive and consume the benefits of such services. Royalty revenues are based on net sales of the Company’s licensed products by a

third

party. We recognize royalty revenues in the period the sales occur based on

third

party evidence received.

Contracts with customers that contain instruments

may

include multiple performance obligations. For these contracts, the Company allocates the contract’s transaction price to each performance obligation on a relative standalone selling price basis. Allocation of the transaction price is determined at the contracts’ inception.

Payment terms for shipments to end-users are generally net

days. Payment terms for distributor shipments

may

range from

days. Service arrangements commonly call for payments in advance of performing the work (e.g. extended warranty and service contracts), upon completion of the service (e.g. custom development manufacturing) or a mix of both.

Contract assets include revenues recognized in advance of billings. Contract assets are included within other current assets in the accompanying balance sheet as the amount of time expected to lapse until the company's right to consideration becomes unconditional is less than

one

year. We elected the practical expedient allowing us to expense contract costs that would otherwise be capitalized and amortized over a period of less than

one

year. Contract assets as of

September 30, 2018

are

not

material.

Contract liabilities include billings in excess of revenues recognized, such as those resulting from customer advances and deposits and unearned revenue on warranty contracts. Contract liabilities as of the adoption date and subsequently recognized as revenue during the

first

quarter of fiscal year

2019

were approximately

$3.8

million. Contract liabilities as of

September 30, 2018

were approximately

$10.6

million. Long-term contract liabilities are included in the Other long-term liabilities on the balance sheet.

Any claims for credit or return of goods must be made within

days of receipt. Revenues are reduced to reflect estimated credits and returns. Although the amounts recorded for these revenue deductions are dependent on estimates and assumptions, historically our adjustments to actual results have

not

been material.

Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from revenue. Amounts billed to customers for shipping and handling are included in revenue, while the related shipping and handling costs are reflected in cost of products. We have elected the practical expedient that allows us to account for shipping and handling activities that occur after the customer has obtained control of a good as a fulfillment cost, and we accrue costs of shipping and handling when the related revenue is recognized.

The following tables present our disaggregated revenue for the periods presented.

Revenue by type is as follows:

	Quarter Ended
	September 30,
	2018		2017
Consumables	$	135,653	$	120,102
Instruments		15,346		12,988
Services		8,301		8,378
Total product and services revenue, net	$	159,299	$	141,766
Royalty revenues		3,671		2,847
Total revenues, net	$	162,970	$	144,613

Revenue by geography is as follows:

	Quarter Ended
	September 30,
	2018		2017
United States	$	90,455	$	79,819
EMEA, excluding United Kingdom		35,233		31,390
United Kingdom		7,128		6,924
APAC, excluding Greater China		11,629		11,489
Greater China		13,422		10,717
Rest of World		5,103		4,274
Total revenues, net	$	162,970	$	144,613