Quarterly report pursuant to Section 13 or 15(d)

Revenue from Contracts with Customers

v3.24.2
Revenue from Contracts with Customers
 6 Months Ended
Jun. 30, 2024
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
Revenue by Market
The table below presents disaggregated net revenues by market (in thousands):
Three Months Ended June 30, Six Months Ended June 30,
2024 2023 2024 2023
Broadband $ 21,827  $ 53,549  $ 54,882  $ 135,230 
% of net revenue 24  % 29  % 29  % 31  %
Connectivity 13,263  37,939  22,974  104,207 
% of net revenue 14  % 21  % 12  % 24  %
Infrastructure 31,785  49,262  64,390  95,564 
% of net revenue 35  % 27  % 34  % 22  %
Industrial and multi-market 25,115  43,188  45,013  97,379 
% of net revenue 27  % 23  % 24  % 23  %
Total net revenue $ 91,990  $ 183,938  $ 187,259  $ 432,380 
Revenues from sales through the Company’s distributors accounted for 55% and 53% of net revenue for the three months ended June 30, 2024 and 2023, respectively. Revenues from sales through the Company’s distributors accounted for 45% and 47% of net revenue for the six months ended June 30, 2024 and 2023, respectively. Revenue related to the sales of intellectual property recognized during the six months ended June 30, 2024 has been allocated by market based upon the usage of such intellectual property.
Contract Liabilities
As of June 30, 2024 and December 31, 2023, customer contract liabilities were approximately $2.6 million and $1.6 million, respectively, and consisted primarily of advanced payments received for which performance obligations have not been completed. Revenue recognized in each of the six months ended June 30, 2024 and 2023 that was included in the contract liability balance as of the beginning of each of those respective periods was immaterial.
There were no material changes in the contract liabilities balance during the six months ended June 30, 2024 and 2023.
Obligations to Customers for Price Adjustments and Returns and Assets for Right-of-Returns
As of June 30, 2024 and December 31, 2023, obligations to customers consisting of estimates of price protection rights offered to the Company’s end customers totaled $61.6 million and $71.7 million, respectively, and are included in accrued price protection liability in the consolidated balance sheets. For activity in this account, including amounts included in net revenue, refer to Note 7.
Other obligations to customers representing estimates of price adjustments to be claimed by distributors upon sell-through of their inventory to their end customer and estimates of stock rotation returns to be claimed by distributors on products sold as of June 30, 2024 were $20.5 million and $0.1 million, respectively, and as of December 31, 2023 were $54.8 million and $0.3 million, respectively, and are included in accrued expenses and other current liabilities in the consolidated balance
sheets (Note 7). The reason for the significant decrease in accrued obligations to customers for price adjustments from approximately $54.8 million as of December 31, 2023 to approximately $20.5 million as of June 30, 2024, was due to a significant decrease in sales to distributors which decreased the corresponding accrued obligations to such customers. The increase or decrease in revenue in each of the six months ended June 30, 2024 and 2023 from net changes in transaction prices for amounts included in obligations to customers for price adjustments as of the beginning of those respective periods was not material.
As of June 30, 2024 and December 31, 2023, right of return assets under customer contracts representing the estimates of product inventory the Company expects to receive from customers in stock rotation returns were approximately $45 thousand and $0.1 million, respectively. Right of return assets are included in inventory in the consolidated balance sheets.
As of June 30, 2024 and December 31, 2023, there were no impairment losses recorded on customer accounts receivable.