Revenues from Contracts with Customers

6 Months Ended

Dec. 31, 2021

Revenue From Contract With Customer [Abstract]

Revenues from Contracts with Customers

Note 6. Revenues from Contracts with Customers

Disaggregation of Revenues

The Company disaggregates revenues by contract type, customer type, prime vs. subcontractor, and whether the solution provided is primarily expertise or technology.  These categories represent how the nature, amount, timing, and uncertainty of revenues and cash flows are affected.

Disaggregated revenues by contract type were as follows (in thousands):

	Three Months Ended						Six Months Ended
	December 31, 2021						December 31, 2021
	Domestic		International		Total		Domestic		International		Total
Cost-plus-fee	$	889,358	$	—	$	889,358	$	1,783,071	$	—	$	1,783,071
Fixed-price		400,011		33,279		433,290		774,485		66,510		840,995
Time-and-materials		148,881		14,249		163,130		324,416		28,194		352,610
Total	$	1,438,250	$	47,528	$	1,485,778	$	2,881,972	$	94,704	$	2,976,676

	Three Months Ended						Six Months Ended
	December 31, 2020						December 31, 2020
	Domestic		International		Total		Domestic		International		Total
Cost-plus-fee	$	843,584	$	—	$	843,584	$	1,667,193	$	—	$	1,667,193
Fixed-price		411,114		29,707		440,821		820,698		53,937		874,635
Time-and-materials		172,362		11,944		184,306		357,356		29,033		386,389
Total	$	1,427,060	$	41,651	$	1,468,711	$	2,845,247	$	82,970	$	2,928,217

Disaggregated revenues by customer type were as follows (in thousands):

	Three Months Ended						Six Months Ended
	December 31, 2021						December 31, 2021
	Domestic		International		Total		Domestic		International		Total
Department of Defense	$	1,037,014	$	—	$	1,037,014	$	2,037,141	$	—	$	2,037,141
Federal Civilian agencies		371,897		—		371,897		785,561		—		785,561
Commercial and other		29,339		47,528		76,867		59,270		94,704		153,974
Total	$	1,438,250	$	47,528	$	1,485,778	$	2,881,972	$	94,704	$	2,976,676

	Three Months Ended						Six Months Ended
	December 31, 2020						December 31, 2020
	Domestic		International		Total		Domestic		International		Total
Department of Defense	$	1,012,875	$	—	$	1,012,875	$	2,017,070	$	—	$	2,017,070
Federal Civilian agencies		390,034		—		390,034		780,213		—		780,213
Commercial and other		24,151		41,651		65,802		47,964		82,970		130,934
Total	$	1,427,060	$	41,651	$	1,468,711	$	2,845,247	$	82,970	$	2,928,217

Disaggregated revenues by prime vs. subcontractor were as follows (in thousands):

	Three Months Ended						Six Months Ended
	December 31, 2021						December 31, 2021
	Domestic		International		Total		Domestic		International		Total
Prime contractor	$	1,292,529	$	43,317	$	1,335,846	$	2,591,182	$	86,223	$	2,677,405
Subcontractor		145,721		4,211		149,932		290,790		8,481		299,271
Total	$	1,438,250	$	47,528	$	1,485,778	$	2,881,972	$	94,704	$	2,976,676

	Three Months Ended						Six Months Ended
	December 31, 2020						December 31, 2020
	Domestic		International		Total		Domestic		International		Total
Prime contractor	$	1,288,533	$	38,492	$	1,327,025	$	2,577,238	$	76,625	$	2,653,863
Subcontractor		138,527		3,159		141,686		268,009		6,345		274,354
Total	$	1,427,060	$	41,651	$	1,468,711	$	2,845,247	$	82,970	$	2,928,217

Disaggregated revenues by expertise or technology were as follows (in thousands):

	Three Months Ended						Six Months Ended
	December 31, 2021						December 31, 2021
	Domestic		International		Total		Domestic		International		Total
Expertise	$	668,209	$	18,100	$	686,309	$	1,351,833	$	37,522	$	1,389,355
Technology		770,041		29,428		799,469		1,530,139		57,182		1,587,321
Total	$	1,438,250	$	47,528	$	1,485,778	$	2,881,972	$	94,704	$	2,976,676

	Three Months Ended						Six Months Ended
	December 31, 2020						December 31, 2020
	Domestic		International		Total		Domestic		International		Total
Expertise	$	715,812	$	16,464	$	732,276	$	1,439,009	$	33,950	$	1,472,959
Technology		711,248		25,187		736,435		1,406,238		49,020		1,455,258
Total	$	1,427,060	$	41,651	$	1,468,711	$	2,845,247	$	82,970	$	2,928,217

Changes in Estimates

The Company recognizes revenues on many of its fixed price, award fee, and incentive fee arrangements over time primarily using a cost-to-cost input method based on the ratio of costs incurred to date to total estimated costs at completion. The process requires the Company to use professional judgment when assessing risks, estimating contract revenues and costs, estimating variable consideration, and making assumptions for schedule and technical issues.  The Company periodically reassesses its assumptions and updates its estimates as needed.  When estimates of total costs to be incurred on a contract exceed total revenues, a provision for the entire loss on the contract is recorded in the period in which the loss is determined.

Aggregate net changes in estimates for the three and six months ended December 31, 2021 reflected an increase to income before income taxes of $5.5 million ($0.17 per diluted share) and $8.2 million ($0.26 per diluted share), respectively, compared with $18.1 million ($0.53 per diluted share) and $25.9 million ($0.75 per diluted share), for the three and six months ended December 31, 2020, respectively.  The Company uses its statutory tax rate when calculating the impact to diluted earnings per share.

Revenues recognized from previously satisfied performance obligations were not material for the three and six months ended December 31, 2021 or the three and six months ended December 31, 2020.  The change in revenues generally relates to final true-up adjustments for estimated award or incentive fees in the period in which the customer’s final performance score was received or when it can be determined that more objective, contractually-defined criteria have been fully satisfied.  

Remaining Performance Obligations

Remaining performance obligations (RPO) represent the expected revenues to be recognized for the satisfaction of remaining performance obligations on existing contracts.  This balance excludes unexercised contract option years and task orders that may be issued underneath an Indefinite Delivery/Indefinite Quantity (IDIQ) vehicle until such task orders are awarded.  The RPO balance generally increases with the execution of new contracts and converts into revenues as contractual performance obligations are satisfied. The Company continues to monitor this balance as it is subject to change from execution of new contracts, contract modifications or extensions, government deobligations, or early terminations.

As of December 31, 2021, the Company had $7.2 billion of RPO and expects to recognize approximately 85 percent over the next twelve months with the remainder to be recognized thereafter.