Revenue from Contracts with Customers

12 Months Ended

Jan. 02, 2022

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

REVENUE FROM CONTRACTS WITH CUSTOMERS

Disaggregation of Revenue

The following tables represent disaggregated revenue from contracts with customers for fiscal 2021, 2020, and 2019 along with the reportable segment for each category:

	Fiscal Year Ended
(In thousands)	January 2, 2022								January 3, 2021								December 29, 2019
Category	Residential. Light Commercial		Commercial and Industrial Solutions		Others		Total Revenues		Residential. Light Commercial		Commercial and Industrial Solutions		Others		Total Revenues		Residential. Light Commercial		Commercial and Industrial Solutions		Others		Total Revenues
Solar power systems sales and EPC services	786,707		180,494		7,844		$	975,045	540,690		245,391		6,109		$	792,190	409,859		231,281		72,366		$	713,506
Component/product sales	240,911		—		—		240,911		185,858		—		—		185,858		185,620		—		—		185,620
Light commercial products	72,126		—		—		72,126		97,136		—		—		97,136		112,398		—		—		112,398
Operations and maintenance	—		10,971		2,981		13,952		—		8,036		20,603		28,639		—		10,785		40,841		51,626
Leasing revenue	21,459		—		—		21,459		19,698		1,308		—		21,006		27,860		1,216		—		29,076
Total revenues	$	1,121,203	$	191,465	$	10,825	$	1,323,493	$	843,382	$	254,735	$	26,712	$	1,124,829	$	735,737	$	243,282	$	113,207	$	1,092,226

Changes in estimates for sales of EPC services on projects in our commercial and industrial solutions segment occur for a variety of reasons, including but not limited to (i) construction plan accelerations or delays, (ii) product cost forecast changes, (iii) change orders, or (iv) changes in other information used to estimate costs. Changes in estimates may have a material effect in our consolidated statements of operations. The table below outlines the impact on revenue of net changes in estimated transaction prices and input costs for systems related sales contracts (both increases and decreases) for the years ended January 2, 2022, January 3, 2021, and December 29, 2019 as well as the number of projects that comprise such changes. For purposes of the following table, only projects with changes in estimates that have an impact on revenues and or costs of at least $1.0 million, calculated on a quarterly basis during the periods, were presented. Also, included in the table is the net change in estimate as a percentage of the aggregate revenue for such projects.

	Fiscal Year Ended
(In thousands, except number of projects)	January 2, 2022			January 3, 2021			December 29, 2019
Increase (decrease) in revenue from net changes in transaction prices	$	10,905		$	2,838		$	5,391
Increase (decrease) in revenue from net changes in input cost estimates	$	(9,996)		$	(762)		$	6,233
Net increase (decrease) in revenue from net changes in estimates	$	909		$	2,076		$	11,624
Number of projects	8			4			5
Net change in estimate as a percentage of aggregate revenue for associated projects	1.5		%	1.2		%	11.6		%

Contract Assets and Liabilities

Contract assets consist of (i) retainage which represents the earned, but unbilled, portion of a construction and development project for which payment is deferred by the customer until certain contractual milestones are met; and (ii) unbilled receivables which represent revenue that has been recognized in advance of billing the customer, which is common for long-term construction contracts. Contract liabilities consist of deferred revenue and customer advances, which represent consideration received from a customer prior to transferring control of goods or services to the customer under the terms of a sales contract. Refer to Note 4. Balance Sheet Components for further details. Total contract assets and contract liabilities balances as of the respective dates are as follows:

	As of
(In thousands)	January 2, 2022		January 3, 2021
Contract assets	$	87,952	$	122,802
Contract liabilities	116,645		102,594

During the year ended January 2, 2022, the decrease in contract assets of $34.9 million was primarily driven by a settlement for milestone achievement for one legacy power plant project, as well as a collection of variable consideration on a power plant development project sold in prior years. Of the total decrease in contract assets, the increase in management’s estimate of variable consideration on power plant development projects sold in prior years was $9.1 million.

During the year ended January 3, 2021, the increase in contract assets of $6.0 million was primarily driven by commercial projects where certain milestones had not yet been reached, but the criteria for revenue had been met.

During the year ended January 2, 2022, the increase in contract liabilities of $14.1 million was primarily due to increase in invoiced contracts waiting for revenue recognition, as well as increase in billings in excess of cost.

During the year ended January 3, 2021, the decrease in contract liabilities of $20.7 million was primarily due to revenue recognized from customer advances.

During the year ended January 2, 2022, we recognized revenue of $44.3 million that was included in contract liabilities as of January 3, 2021. During the year ended January 3, 2021, we recognized revenue of $97.8 million that was included in contract liabilities as of December 29, 2019.

The following table represents the average percentage of completion as of January 2, 2022 for EPC agreements for commercial projects that we are constructing. We expect to recognize $225.6 million of revenue upon transfer of control of the projects.

Project	Revenue Category	EPC Contract/Partner Developed Project	Expected Year Revenue Recognition Will Be Completed	Average Percentage of Revenue Recognized
Various Distribution Generation Projects	Solar power systems sales and EPC services	Various	2023	89.0	%

As of January 2, 2022, we have entered into contracts with customers for sales of solar power systems and components for an aggregate transaction price of $453.5 million, the substantial majority of which we expect to recognize over the next 12 months.