Revenues from Contracts with Customers

9 Months Ended

Mar. 31, 2022

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						Nine Months Ended
	March 31, 2022						March 31, 2022
	Domestic		International		Total		Domestic		International		Total
Cost-plus-fee	$	889,624	$	—	$	889,624	$	2,672,695	$	—	$	2,672,695
Fixed-price		468,116		35,058		503,174		1,242,601		101,568		1,344,169
Time-and-materials		175,140		16,042		191,182		499,556		44,236		543,792
Total	$	1,532,880	$	51,100	$	1,583,980	$	4,414,852	$	145,804	$	4,560,656

	Three Months Ended						Nine Months Ended
	March 31, 2021						March 31, 2021
	Domestic		International		Total		Domestic		International		Total
Cost-plus-fee	$	905,774	$	—	$	905,774	$	2,572,967	$	—	$	2,572,967
Fixed-price		424,580		32,519		457,099		1,245,278		86,456		1,331,734
Time-and-materials		174,683		14,362		189,045		532,039		43,395		575,434
Total	$	1,505,037	$	46,881	$	1,551,918	$	4,350,284	$	129,851	$	4,480,135

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

	Three Months Ended						Nine Months Ended
	March 31, 2022						March 31, 2022
	Domestic		International		Total		Domestic		International		Total
Department of Defense	$	1,118,665	$	—	$	1,118,665	$	3,155,806	$	—	$	3,155,806
Federal Civilian agencies		380,837		—		380,837		1,166,398		—		1,166,398
Commercial and other		33,378		51,100		84,478		92,648		145,804		238,452
Total	$	1,532,880	$	51,100	$	1,583,980	$	4,414,852	$	145,804	$	4,560,656

	Three Months Ended						Nine Months Ended
	March 31, 2021						March 31, 2021
	Domestic		International		Total		Domestic		International		Total
Department of Defense	$	1,074,056	$	—	$	1,074,056	$	3,091,126	$	—	$	3,091,126
Federal Civilian agencies		405,855		—		405,855		1,186,068		—		1,186,068
Commercial and other		25,126		46,881		72,007		73,090		129,851		202,941
Total	$	1,505,037	$	46,881	$	1,551,918	$	4,350,284	$	129,851	$	4,480,135

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

	Three Months Ended						Nine Months Ended
	March 31, 2022						March 31, 2022
	Domestic		International		Total		Domestic		International		Total
Prime contractor	$	1,373,045	$	46,760	$	1,419,805	$	3,964,227	$	132,983	$	4,097,210
Subcontractor		159,835		4,340		164,175		450,625		12,821		463,446
Total	$	1,532,880	$	51,100	$	1,583,980	$	4,414,852	$	145,804	$	4,560,656

	Three Months Ended						Nine Months Ended
	March 31, 2021						March 31, 2021
	Domestic		International		Total		Domestic		International		Total
Prime contractor	$	1,358,423	$	43,210	$	1,401,633	$	3,935,661	$	119,835	$	4,055,496
Subcontractor		146,614		3,671		150,285		414,623		10,016		424,639
Total	$	1,505,037	$	46,881	$	1,551,918	$	4,350,284	$	129,851	$	4,480,135

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

	Three Months Ended						Nine Months Ended
	March 31, 2022						March 31, 2022
	Domestic		International		Total		Domestic		International		Total
Expertise	$	697,347	$	18,852	$	716,199	$	2,049,180	$	56,374	$	2,105,554
Technology		835,533		32,248		867,781		2,365,672		89,430		2,455,102
Total	$	1,532,880	$	51,100	$	1,583,980	$	4,414,852	$	145,804	$	4,560,656

	Three Months Ended						Nine Months Ended
	March 31, 2021						March 31, 2021
	Domestic		International		Total		Domestic		International		Total
Expertise	$	745,440	$	18,979	$	764,419	$	2,184,449	$	52,929	$	2,237,378
Technology		759,597		27,902		787,499		2,165,835		76,922		2,242,757
Total	$	1,505,037	$	46,881	$	1,551,918	$	4,350,284	$	129,851	$	4,480,135

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 nine months ended March 31, 2022 reflected an increase to income before income taxes of $13.0 million ($0.40 per diluted share) and $21.2 million ($0.66 per diluted share), respectively, compared with $10.7 million ($0.31 per diluted share) and $36.6 million ($1.06 per diluted share), for the three and nine months ended March 31, 2021, 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 nine months ended March 31, 2022 compared to $0.7 million and $2.3 million for the three and nine months ended March 31, 2021, respectively.  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 March 31, 2022, the Company had $6.8 billion of RPO and expects to recognize approximately 90 percent over the next twelve months with the remainder to be recognized thereafter.