Quarterly report [Sections 13 or 15(d)]

Revenue Recognition

v3.25.1
Revenue Recognition
 3 Months Ended
Mar. 31, 2025
Revenue from Contract with Customer [Abstract]  
Revenue Recognition

3.

Revenue Recognition

Revenue by Service Line

 

Three Months Ended March 31,

 

(in thousands)

 

2025

 

 

2024

 

Biologics and drug delivery

 

 

 

 

 

 

Disposable products

 

$

1,780

 

 

$

553

 

Services and license fees

 

 

2,911

 

 

 

3,754

 

Subtotal – Biologics and drug delivery revenue

 

 

4,691

 

 

 

4,307

 

Neurosurgery navigation and therapy

 

 

 

 

 

 

Disposable products

 

 

3,277

 

 

 

1,927

 

Services

 

 

—

 

 

 

—

 

Subtotal – Neurosurgery navigation and therapy revenue

 

 

3,277

 

 

 

1,927

 

Capital equipment and software

 

 

 

 

 

 

Systems and software products

 

 

234

 

 

 

1,155

 

Services

 

 

283

 

 

 

250

 

Subtotal – Capital equipment and software revenue

 

 

517

 

 

 

1,405

 

Total revenue

 

$

8,485

 

 

$

7,639

 

Contract Balances

•
Contract assets – The timing of revenue recognition may differ from the time of billing to the Company's customers. In most cases, customers are billed upon shipment of such products or delivery of such services and the related contract assets, which represent an unconditional right to consideration, comprise the accounts receivable balance. When revenue is recognized in advance of its right to bill and receive consideration, the Company records this unbilled receivable as a contract asset, which is classified as other current assets in the accompanying condensed consolidated balance sheets. Additionally, at March 31, 2025, the Company had $0.1 million in deferred contract costs, classified as other current assets, related to up-front costs for direct materials incurred to fulfill a customer contract.

(in thousands)

 

March 31, 2025

 

 

December 31, 2024

 

Accounts receivable, net

 

$

3,651

 

 

$

4,713

 

Other contract assets

 

 

 

 

 

 

Unbilled receivables

 

$

804

 

 

$

642

 

Deferred contract costs

 

$

108

 

 

$

—

 
•
Contract liabilities – Contract liabilities consist of amounts that have been invoiced and for which the Company has the right to bill, but that have not been recognized as revenue as the related goods or services have not been transferred. The Company's contract liabilities are generally comprised of the following: (1) capital equipment and software-related service fees that are typically billed and collected at the inception of the service agreements, which have terms ranging from one to three years; (2) annual fees for agreements with customers that bundle the capital equipment and software-related service fees with software and hardware upgrades that are made commercially available over the term of the contract; and (3) up-front payments from customers made in connection with consulting services. The unearned portion of all such fees is classified as deferred revenue.

(in thousands)

 

March 31, 2025

 

 

December 31, 2024

 

Deferred revenues

 

$

1,975

 

 

$

2,557

 

During the three months ended March 31, 2025, the Company recognized approximately $0.8 million of revenue, which was previously included in deferred revenue in the accompanying condensed consolidated balance sheet at December 31, 2024. During the three months ended March 31, 2024, the Company recognized approximately $1.5 million of revenue, which was previously included in deferred revenue in the accompanying condensed consolidated balance sheet at December 31, 2023.

Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue that will be recognized as revenue in future periods. The majority of the remaining performance obligations relate to capital equipment and software-related service agreements and the upfront payments discussed under the heading "Contract Balances" above, which amounted to approximately $1.7 million at March 31, 2025. The Company expects to recognize 79% of this revenue over the next twelve months and the remainder thereafter.