Revenue From Contracts With Customers

9 Months Ended

Sep. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue From Contracts With Customers

REVENUE FROM CONTRACTS WITH CUSTOMERS

Sales are derived from products for different applications: fiber lasers, diode lasers, diodes and systems for materials processing, fiber lasers and amplifiers for advanced applications, fiber amplifiers and transceivers for communications applications, and fiber lasers for medical applications.

The following tables represent a disaggregation of revenue from contracts with customers:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Sales by Application
Materials processing	$	290,028	$	306,260	$	779,810	$	952,936
Other applications	28,413		22,878		84,284		55,018
Total	$	318,441	$	329,138	$	864,094	$	1,007,954

Sales by Product
High Power Continuous Wave ("CW") Lasers	$	184,387	$	184,924	$	461,181	$	577,354
Medium Power CW Lasers	11,756		11,891		33,701		42,904
Pulsed Lasers	34,975		33,850		109,391		106,100
Quasi-Continuous Wave ("QCW") Lasers	15,079		12,479		38,660		42,612
Laser and Non-Laser Systems	20,841		32,929		64,417		104,943
Other Revenue including Amplifiers, Service, Parts, Accessories and Change in Deferred Revenue	51,403		53,065		156,744		134,041
Total	$	318,441	$	329,138	$	864,094	$	1,007,954

Sales by Geography
North America	$	52,732	$	71,000	$	173,972	$	199,947
Europe:
Germany	16,163		17,204		51,208		59,487
Other including Eastern Europe/CIS	54,907		62,196		158,686		192,527
Asia and Australia:
China	148,049		121,290		361,864		399,246
Japan	12,884		21,859		41,241		54,879
Other	31,227		28,877		70,924		89,544
Rest of World	2,479		6,712		6,199		12,324
Total	$	318,441	$	329,138	$	864,094	$	1,007,954

Timing of Revenue Recognition
Goods and services transferred at a point in time	$	308,474	$	310,324	$	824,069	$	944,454
Goods and services transferred over time	9,967		18,814		40,025		63,500
Total	$	318,441	$	329,138	$	864,094	$	1,007,954

One of the Company's customers accounted for 35% and 24% of the Company's net accounts receivable as of September 30, 2020 and December 31, 2019, respectively.

The Company enters into contracts to sell lasers and spare parts, for which revenue is generally recognized upon shipment or delivery, depending on the terms of the contract. The Company also provides installation services and extended warranties. The Company frequently receives consideration from a customer prior to transferring goods to the customer under the terms of a sales contract. The Company records customer deposits related to these prepayments, which represent a contract liability. The Company also records deferred revenue related to installation services when consideration is received before the services have

been performed. The Company recognizes customer deposits and deferred revenue as net sales after control of the goods or services has been transferred to the customer and all revenue recognition criteria are met. The Company bills customers for extended warranties upon entering into the agreement with the customer, resulting in deferred revenue. The timing of customer payments on contracts for the sale of customized robotic systems generally differs from the timing of revenue recognized, resulting in contract assets and liabilities. Contract assets are included within prepaid expense and other current assets on the condensed consolidated balance sheets. Contract liabilities are included within accrued expenses and other current liabilities on the condensed consolidated balance sheets.

The following table reflects the changes in the Company's contract assets and liabilities for the nine months ended September 30, 2020 and 2019:

	September 30,		December 31,				September 30,		December 31,
	2020		2019		Change		2019		2018		Change
Contract assets
Contract assets	$	6,771	$	9,645	$	(2,874)	$	10,606	$	10,102	$	504
Contract liabilities
Contract liabilities - current	57,034		59,531		(2,497)		49,358		52,606		(3,248)
Contract liabilities - long-term	2,121		1,820		301		1,677		1,413		264

During the three months ended September 30, 2020 and 2019 the Company recognized revenue of $10,179 and $4,534, respectively, that was included in contract liabilities at the beginning of each period. During the nine months ended September 30, 2020 and 2019, the Company recognized revenue of $41,622 and $40,786, respectively, that was included in contract liabilities at the beginning of each period.

The Company has elected the practical expedient in ASC 606-10-50-14, whereby the performance obligations for contracts with an original expected duration of one year or less are not disclosed. The following table represents the Company's remaining performance obligations from contracts that are recognized over time as of September 30, 2020:

	Remaining Performance Obligations
	2020 (a)		2021		2022		2023		2024		Thereafter		Total
Revenue expected to be recognized for extended warranty agreements	$	1,439	$	2,724	$	874	$	566	$	265	$	56	$	5,924
Revenue to be earned over time from contracts to sell robotic systems	10,934		16,941		—		—		—		—		27,875
Total	$	12,373	$	19,665	$	874	$	566	$	265	$	56	$	33,799

(a) For the three-month period beginning October 1, 2020.