Company: CRCT
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001828962-25-000075
Chunk: 37

Company: Cricut, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 1
Chunk 37
---
 common stock on an individual or combined basis. Basic earnings per share is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted earnings per share is computed using the weighted-average number of outstanding shares of common stock and, when dilutive, potential shares of common stock outstanding during the period. Stock-based awards subject to conditions other than service conditions are considered contingently issuable shares and are included in basic EPS based on the number of awards that would be issuable if the reporting date were the end of the contingency period.Accounts ReceivableAccounts receivable are recorded at original invoice amounts less estimates for credit losses. Management determines the allowance for credit losses by specifically identifying troubled accounts and by using historical write off experience, adjusted for current market conditions and reasonable supportable forecasts of future economic conditions, applied to an aging of all other accounts receivable. Accounts receivable are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are recorded when received.

9

As of March 31, 2025, December 31, 2024, and January 1, 2024, the Company had net accounts receivable balances of $72.3 million, $102.0 million and $111.2 million, respectively. As of March 31, 2025, and December 31, 2024, the Company had an allowance for credit losses against accounts receivable of $1.3 million and $2.6 million, respectively. 

3.Revenue and Deferred Revenue

Deferred revenue relates to performance obligations for which payments have been received from the customer prior to revenue recognition. Deferred revenue primarily consists of deferred subscription-based services. Deferred revenue also includes amounts allocated from the sale of a connected machine to the unspecified upgrades and enhancements and the Company’s cloud-based services. Contract costs consist of amounts paid to obtain contracts with customers in connection with sales of subscriptions through third-party apps. Contract costs are amortized over the subscription term. As of March 31, 2025 and December 31, 2024 the Company had $1.5 million and $1.2 million recorded for capitalized contract costs, respectively.The following table summarizes the changes in the deferred revenue balance for the three months ended March 31, 2025 and 2024: Three Months Ended March 31,20252024(in thousands)Deferred revenue, beginning of period$48,253 $43,235 Recognition of revenue included in beginning of perioddeferred revenue