Quarterly report pursuant to Section 13 or 15(d)

Revenue from Contracts with Customers

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Revenue from Contracts with Customers
 9 Months Ended
Sep. 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 September 30, Nine Months Ended September 30,
2024 2023 2024 2023
Broadband $ 32,275  $ 34,416  $ 87,157  $ 169,646 
% of net revenue 40  % 25  % 32  % 30  %
Connectivity 12,726  15,025  35,700  119,232 
% of net revenue 16  % 11  % 13  % 21  %
Infrastructure 23,046  49,985  87,436  145,549 
% of net revenue 28  % 37  % 33  % 26  %
Industrial and multi-market 13,055  36,104  58,068  133,483 
% of net revenue 16  % 27  % 22  % 23  %
Total net revenue $ 81,102  $ 135,530  $ 268,361  $ 567,910 
Revenues from sales through the Company’s distributors accounted for 35% and 46% of net revenue for the three months ended September 30, 2024 and 2023, respectively. Revenues from sales through the Company’s distributors accounted for 42% and 47% of net revenue for the nine months ended September 30, 2024 and 2023, respectively. Revenue related to the sales of intellectual property recognized during the nine months ended September 30, 2024 has been allocated by market based upon the usage of such intellectual property.
Contract Liabilities
As of September 30, 2024 and December 31, 2023, customer contract liabilities were approximately $0.2 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 nine months ended September 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 nine months ended September 30, 2024 and 2023.
Obligations to Customers for Price Adjustments and Returns and Assets for Right-of-Returns
As of September 30, 2024 and December 31, 2023, obligations to customers consisting of estimates of price protection rights offered to the Company’s end customers totaled $44.5 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 September 30, 2024 were $20.6 million and $0.2 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 $20.6 million as of September 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 for the three and nine months ended September 30, 2024 and 2023 from net changes in transaction prices for amounts included in obligations to customers for price adjustments and estimates of stock rotation returns to be claimed by distributors as of the beginning of those respective periods was not material.
As of September 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 $58 thousand and $0.1 million, respectively. Right of return assets are included in inventory in the consolidated balance sheets.
As of September 30, 2024 and December 31, 2023, there were no impairment losses recorded on customer accounts receivable.