Note 4 - Revenue Recognition

6 Months Ended

Jun. 30, 2021

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

NOTE 4: REVENUE RECOGNITION

Under ASC 606, “Revenue from Contracts with Customers” (“ASC 606”), an entity recognizes revenue when or as it satisfies a performance obligation by transferring intellectual property (“IP”) licenses or services to the customer, either at a point in time or over time. The Company recognizes most of its revenues at a point in time upon delivery when the customer accepts control of the IP. The Company recognizes revenue over time on significant license customization contracts that are in the scope of ASC 606 by using cost inputs to measure progress toward completion of its performance obligations.

The following table includes estimated revenue expected to be recognized in future periods related to performance obligations that are unsatisfied or partially unsatisfied at the end of the reporting period. The estimated revenues do not include amounts of royalties or unexercised contract renewals:

	Remainder of 2021		2022
License and related revenues	$	12,452	$	2,213

Disaggregation of revenue:

The following table provides information about disaggregated revenue by primary geographical market, major product line and timing of revenue recognition (in thousands):

	Six months ended June 30, 2021 (unaudited)						Three months ended June 30, 2021 (unaudited)
	Licensing, NRE and related revenues		Royalties		Total		Licensing, NRE and related revenues		Royalties		Total
Primary geographical markets
United States	$	5,294	$	5,204	$	10,498	$	4,722	$	1,826	$	6,548
Europe and Middle East		833		1,172		2,005		410		496		906
Asia Pacific		23,805		19,551		43,356		10,403		12,600		23,003
Total	$	29,932	$	25,927	$	55,859	$	15,535	$	14,922	$	30,457
Major product/service lines
Connectivity products (baseband for handset and other devices, Bluetooth, Wi-Fi, NB-IoT and SATA/SAS)	$	22,518	$	20,192	$	42,710	$	9,713	$	12,087	$	21,800
Smart sensing products (AI, sensor fusion, audio/sound and imaging and vision)		7,414		5,735		13,149		5,822		2,835		8,657
Total	$	29,932	$	25,927	$	55,859	$	15,535	$	14,922	$	30,457
Timing of revenue recognition
Products transferred at a point in time	$	24,052	$	25,927	$	49,979	$	12,064	$	14,922	$	26,986
Products and services transferred over time		5,880		—		5,880		3,471		—		3,471
Total	$	29,932	$	25,927	$	55,859	$	15,535	$	14,922	$	30,457

	Six months ended June 30, 2020 (unaudited)						Three months ended June 30, 2020 (unaudited)
	Licensing and related revenues		Royalties		Total		Licensing and related revenues		Royalties		Total
Primary geographical markets
United States	$	4,749	$	1,170	$	5,919	$	1,967	$	657	$	2,624
Europe and Middle East		4,633		9,315		13,948		3,574		5,271		8,845
Asia Pacific		18,643		8,711		27,354		7,989		4,148		12,137
Total	$	28,025	$	19,196	$	47,221	$	13,530	$	10,076	$	23,606
Major product/service lines
Connectivity products (baseband for handset and other devices, Bluetooth, Wi-Fi, NB-IoT and SATA/SAS)	$	22,858	$	15,285	$	38,143	$	11,931	$	8,243	$	20,174
Smart sensing products (AI, sensor fusion, audio/sound and imaging and vision)		5,167		3,911		9,078		1,599		1,833		3,432
Total	$	28,025	$	19,196	$	47,221	$	13,530	$	10,076	$	23,606
Timing of revenue recognition
Products transferred at a point in time	$	21,306	$	19,196	$	40,502	$	10,268	$	10,076	$	20,344
Products and services transferred over time		6,719		—		6,719		3,262		—		3,262
Total	$	28,025	$	19,196	$	47,221	$	13,530	$	10,076	$	23,606

Contract balances:

The following table provides information about trade receivables, unbilled receivables and contract liabilities from contracts with customers (in thousands):

	June 30, 2021 (unaudited)		December 31, 2020
Trade receivables	$	10,484	$	14,765
Unbilled receivables (associated with licensing, NRE and related revenue)		2,742		5,479
Unbilled receivables (associated with royalties)		13,471		10,980
Deferred revenues (short-term contract liabilities)		4,382		2,434

The Company receives payments from customers based upon contractual payment schedules; trade receivables are recorded when the right to consideration becomes unconditional, and an invoice is issued to the customer. Unbilled receivables associated with licensing, NRE and other include amounts related to the Company’s contractual right to consideration for completed performance objectives not yet invoiced. Unbilled receivables associated with royalties are recorded as the Company recognizes revenues from royalties earned during the quarter, but not yet invoiced, either by actual sales data received from customers, or, when applicable, by the Company’s estimation. Contract liabilities (deferred revenue) include payments received in advance of performance under the contract, and are realized with the associated revenue recognized under the contract.

During the three and six months ended June 30, 2021, the Company recognized $678 and $1,772, respectively, that was included in deferred revenues (short-term contract liability) balance at January 1, 2021.