Revenue

9 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

The following table provides information regarding the Company’s revenue for each of the services it provides pursuant to its spectrum revenue agreements for the three and nine months ended December 31, 2023 and 2022 (in thousands):

	Three months ended December 31,				Nine months ended December 31,
	2023		2022		2023		2022
Spectrum revenues
900 MHz Broadband Spectrum Revenue
Ameren Corporation	$	152	$	152	$	456	$	457
Evergy	274		244		822		308
Xcel Energy (1)	663		—		1,107		—
Narrowband Spectrum Revenue
Motorola	182		182		546		546
Total spectrum revenue (2)	$	1,271	$	578	$	2,931	$	1,311

1.The Company commenced revenue recognition in connection with the delivery of cleared 900 MHz Broadband Spectrum and the associated broadband licenses to Xcel Energy during the three months ended September 2023.

2.Revenue recognized during the three and nine months ended December 31, 2023 and 2022 was included in deferred revenue at the beginning of the respective periods.

Spectrum Revenue Agreements

Refer to the Company’s 2023 Annual Report for a description of the Company’s spectrum revenue agreements entered into prior to March 31, 2023. The following reflects agreements entered into during the nine months ended December 31, 2023:

On November 22, 2023, the Company entered into an agreement with Tampa Electric Company (“TECO”) to provide TECO the use of the Company’s 900 MHz Broadband Spectrum for a term of 20 years throughout TECO’s service territory in West Central Florida (the “TECO Agreement”). The TECO Agreement also provides TECO an

option to extend the agreement for two 10-year terms for additional payments. The TECO Agreement, which covers an approximately 2,000-square-mile service territory in West Central Florida, is expected to enable TECO to deploy a PLTE network providing critical broadband communications capabilities in support of its initiatives. The scheduled prepayments for the 20-year initial terms of the TECO Agreement total $34.5 million, of which $6.9 million was received by the Company in December 2023. The remaining prepayments for the 20-year initial term are due by fiscal year 2026, per the terms of the TECO Agreement and as the Company delivers the relevant cleared 900 MHz Broadband Spectrum and the associated broadband licenses. The Company is working with incumbents to clear the 900 MHz Broadband Spectrum allocation in TECO service territories. The payments of prepaid fees under the TECO Agreement will be accounted for as deferred revenue on the Company’s Consolidated Balance Sheets. Revenue will be recognized over time as the performance obligations of clearing the 900 MHz Broadband Spectrum and the associated broadband licenses are delivered by respective county, over the contractual term of approximately 20 years.

Capitalized contract costs

The Company capitalizes incremental costs associated with obtaining a contract with a customer, which generally includes sales commissions. The Company’s capitalized contract costs consisted of the following activity during the three and nine months ended December 31, 2023 and 2022 (in thousands):

	Three months ended December 31,				Nine months ended December 31,
	2023		2022		2023		2022
Balance at the beginning of the period	$	884	$	693	$	870	$	638
Additions	12		47		45		109
Amortization	(13)		(4)		(32)		(11)
Balance at the end of the period	883		736		883		736
Less amount classified as current assets (1)	(425)		(347)		(425)		(347)
Noncurrent assets (1)	$	458	$	389	$	458	$	389

1.Current assets are recorded as prepaid expenses and other current assets and noncurrent assets are recorded as other assets on the Company’s Consolidated Balance Sheets.

Contract liabilities

Contract liabilities primarily relate to advanced consideration received from customers for spectrum services, for which revenue is recognized over time, as the services are performed. The Company’s contract liabilities consisted of the following activity during the three and nine months ended December 31, 2023 and 2022 (in thousands):

	Three months ended December 31,				Nine months ended December 31,
	2023		2022		2023		2022
Balance at the beginning of the period	$	80,265	$	53,945	$	60,759	$	54,678
Additions (1)	28,066		8,000		49,232		8,000
Revenue recognized	(1,271)		(578)		(2,931)		(1,311)
Balance at the end of the period	107,060		61,367		107,060		61,367
Less amount classified as current liabilities (2)	(6,163)		(2,656)		(6,163)		(2,656)
Noncurrent liabilities (2)	$	100,897	$	58,711	$	100,897	$	58,711

1.Represents milestone payments of received from customer contracts pursuant to the terms of the associated spectrum lease agreements.

2.Current liabilities and noncurrent liabilities are recorded as deferred revenue on the Company’s Consolidated Balance Sheets.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations of the Company’s contracts represent contracted revenue that will be recognized in future periods. Total performance obligations include deferred revenue (i.e., contract liabilities) as well as amounts that will be invoiced and recognized in future periods. Revenue allocated to remaining performance obligations was $188.5 million as of December 31, 2023, which will be recognized ratably over the remaining contract terms up to 30 years.