Company: GROVW
Filing Date: 2025-03-19
Form Type: 10-K
Source: 0001628280-25-013839
Chunk: 203

Company: Grove Collaborative Holdings, Inc.
Filing Date: 2025-03-19
Form: 10-K
Item: Item 8
Chunk 203
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.e. bundled). At inception of the VIP membership benefit period, the Company allocates the VIP membership fee to each of the two material rights using a relative standalone selling price basis. Generally, standalone selling prices are determined based on the observable price of the good or service when sold separately to non-VIP customers and the estimated number of shipments and free products per benefit period. The Company also considers the likelihood of redemption when determining the standalone selling price for free products. To date, customers buying patterns closely approximate a ratable revenue attribution method over the customers VIP Membership period. Due to these factors, the Company typically recognizes VIP membership revenue ratably over the VIP membership period. The Company deducts discounts, sales tax, customer service credits and estimated refunds to arrive at net revenue. Sales tax collected from customers is not considered revenue and is included in accrued liabilities until remitted to the taxing authorities. The Company has made the policy election to account for shipping and handling as activities to fulfill the promise to transfer the good. Outbound shipping, handling and packaging expenses are recognized upon shipment and classified within selling, general and administrative expenses. Discounts are recorded as a reduction to revenue when revenue is recognized. The Company records a refund reserve based on historical refund patterns. As of December 31, 2024 and 2023, the refund reserve, which is included in accrued liabilities in the consolidated balance sheets, was nominal. Disaggregation of Revenue The following table sets forth revenue by product type (in thousands):  Year Ended December 31,20242023Revenue, net:Grove Brands$82,942 $119,006 Third-party products120,483 140,272 Total revenue, net$203,425 $259,278 

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Table of ContentsGrove Collaborative Holdings, Inc.Notes to Consolidated Financial Statements (continued)

Contractual Liabilities The Company has three types of contractual liabilities from transactions with customers: (i) cash collections for products which have not yet shipped, which are included in deferred revenue and are recognized as revenue upon the Company’s delivery to a third-party carrier, (ii) cash collections of VIP membership fees, which are included in deferred revenue and (iii) customer service credits, which are recognized in other current liabilities and as a reduction in revenue when provided to the customer. As of December 31, 2024, the Company does not have liabilities related to cash collections for products which have not yet shipped as payment is now collected upon shipment. Contractual liabilities included in deferred revenue