Revenue (Notes)

6 Months Ended

Apr. 12, 2020

Revenue from Contract with Customer [Abstract]

Revenue

REVENUE

Nature of products and services — We derive revenue from retail sales at Jack in the Box company-operated restaurants and rental revenue, royalties, advertising, and franchise and other fees from franchise-operated restaurants.

Our franchise arrangements generally provide for an initial franchise fee of $50,000 per restaurant and generally require that franchisees pay royalty and marketing fees at 5% of gross sales. The agreement also requires franchisees to pay sourcing, technology and other miscellaneous fees.

Disaggregation of revenue — The following table disaggregates revenue by primary source (in thousands):

	Quarter				Year-to-date
	April 12, 2020		April 14, 2019		April 12, 2020		April 14, 2019
Sources of revenue:
Company restaurant sales	$	74,380	$	76,682	$	179,744	$	179,514
Franchise rental revenues	69,885		61,646		165,969		145,536
Franchise royalties	36,049		37,148		86,292		86,655
Marketing fees	30,550		35,947		79,385		83,810
Technology and sourcing fees	3,578		3,042		8,502		6,993
Franchise fees and other services	1,715		1,262		3,938		4,005
Total revenue	$	216,157	$	215,727	$	523,830	$	506,513

Contract liabilities — Our contract liabilities consist of deferred revenue resulting from initial fees received from franchisees for new restaurant openings or new franchise terms, which are generally recognized over the franchise term. We classify these contract liabilities as “Accrued liabilities” and “Other long-term liabilities” in our condensed consolidated balance sheets.

A summary of significant changes in our contract liabilities is presented below (in thousands):

	Year-to-date
	April 12, 2020		April 14, 2019
Deferred franchise fees at beginning of period	$	46,272	$	50,018
Revenue recognized	(3,061)		(2,745)
Additions	1,488		680
Deferred franchise fees at end of period	$	44,699	$	47,953

The following table reflects the estimated franchise fees to be recognized in the future related to performance obligations that are unsatisfied as of April 12, 2020 (in thousands):

Remainder of 2020	$	2,267
2021	4,926
2022	4,724
2023	4,572
2024	4,379
Thereafter	23,831
	$	44,699

We have applied the optional exemption, as provided for under Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, which allows us to not disclose the transaction price allocated to unsatisfied performance obligations when the transaction price is a sales-based royalty.