Annual report pursuant to Section 13 and 15(d)

Revenues

v3.24.1
Revenues
 12 Months Ended
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]  
Revenues
Note Q – Revenues
The table below presents revenues by customer grouping for the following periods:
Year Ended
  December 31, 2023 December 31, 2022
Civil space
 $ 102,594  $ 63,003 
National security
 59,053  43,906 
Commercial and other
 82,153  53,640 
Total revenues
 $ 243,800  $ 160,549 

The table below presents revenues based on the geographic location of the Company’s customers for the following periods:
Year Ended
December 31, 2023 December 31, 2022
U.S.
 $ 172,903  $ 142,867 
Europe 70,814  17,205 
Other 83  477 
Total revenues
 $ 243,800  $ 160,549 

The majority of the Company’s revenues are derived from government contracts. Customers comprising 10% or more of revenues are presented below for the following periods:
Year Ended
  December 31, 2023 December 31, 2022
Customer A(1)
$ 39,314  $ 17,131 
Customer B(1)
33,621  — 
Customer C(1)
—  20,048 
Customer D(1)
—  21,705 
Total $ 72,935  $ 58,884 
(1) While revenue may have been generated during each of the periods presented, amounts are only disclosed for the periods in which revenues represented 10% or more of total revenue.
Contract Balances
The table below presents the contract assets and contract liabilities included on the consolidated balance sheets for the following periods:
December 31,
2023		 December 31,
2022
Contract assets
 $ 36,961  $ 31,041 
 
Contract liabilities $ 52,645  $ 29,817 

The increase in contract assets was primarily driven by revenue growth and the timing of billable milestones occurring during the year ended December 31, 2023.

The increase in contract liabilities during 2023 was primarily driven by large billable milestones occurring closer to the end of period that were in excess of revenue recognized on the related performance obligations. Revenue recognized in the year ended December 31, 2023 that was included in the contract liability balance as of December 31, 2022 was $28.4 million. Revenue recognized in the year ended December 31, 2022 that was included in the contract liability balance as of December 31, 2021 was $15.2 million.

The Company evaluates the contract value and cost estimates at completion (“EAC”) for performance obligations at least quarterly and more frequently when circumstances significantly change. Due to the nature of the work required to be performed on many of the Company’s performance obligations, the estimate of total revenue and cost at completion is complex, subject to many variables and requires significant judgment by management on a contract-by-contract basis. As part of this process, management reviews information including, but not limited to, labor productivity, the nature and technical complexity of the work to be performed, availability and cost volatility of materials, subcontractor and vendor performance, volume assumptions, inflationary trends, and schedule and performance delays. Management’s judgment related to these considerations has become increasingly more significant given the current macroeconomic environment.

When the Company’s estimate of total costs to be incurred to satisfy a performance obligation exceeds the expected revenue, the Company recognizes the loss immediately. When the Company determines that a change in estimate has an impact on the associated profit of a performance obligation, the Company records the cumulative positive or negative adjustment to the statement of operations and comprehensive income (loss). Changes in estimates and assumptions related to the status of certain long-term contracts may have a material effect on the Company’s operating results.

The below table summarizes the favorable (unfavorable) impact of the net EAC adjustments for the following periods:
Year Ended
  December 31, 2023 December 31, 2022
Net EAC adjustments, before income taxes $ (3,522) $ (9,953)
Net EAC adjustments, net of income taxes (3,459) (9,376)
Net EAC adjustments, net of income taxes, per diluted share (0.05) (0.15)

The change in net EAC adjustments in 2023 was primarily due to increased production costs as it relates to the development of new technologies within the Mission Solutions reporting unit, which were partially offset by the release of contract reserves during the year ended December 31, 2023. The change in net EAC adjustments in 2022 was primarily due to unfavorable changes within the Mission Solutions reporting unit driven by increased production costs contributed by continued supply chain and labor market constraints.

Remaining Performance Obligations
As of December 31, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $353.5 million. The Company expects to recognize approximately 50% of its remaining performance obligations as revenue within the next 12 months and the balance thereafter.