Company: CPS
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001320461-25-000156
Chunk: 84

Company: Cooper-Standard Holdings Inc.
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 8
Chunk 84
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 revenue as products are shipped or delivered. The accruals are based on contractual terms, historical experience, anticipated performance and management’s best judgment. The Company also generally has ongoing adjustments to customer pricing arrangements based on the content and cost of its products. Such pricing accruals are adjusted as they are settled with customers. Customer returns, which are infrequent, are usually related to quality or shipment issues and are recorded as a reduction of revenue. The Company generally does not recognize significant return obligations due to their infrequent nature.

11

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)(Unaudited)(Dollar amounts in thousands except per share and share amounts)

Contract BalancesThe Company’s contract assets consist of unbilled amounts associated with variable pricing arrangements in the Asia Pacific region. Once pricing is finalized, contract assets are transferred to accounts receivable. As a result, the timing of revenue recognition and billings, as well as changes in foreign exchange rates, will impact contract assets on an ongoing basis. Contract assets were not materially impacted by any other factors during the nine months ended September 30, 2025.The Company’s contract liabilities consist of advance payments received and due from customers. Net contract assets (liabilities) consisted of the following: September 30, 2025December 31, 2024ChangeContract assets$2,281 $650 $1,631 Contract liabilities(16)(14)(2)Net contract assets$2,265 $636 $1,629 OtherThe Company, at times, enters into agreements that provide for lump sum payments to customers. These payment agreements are recorded as a reduction of revenue during the period in which the commitment is made, unless the payment is contractually recoverable. Amounts related to commitments of future payments to customers in the condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024 were current liabilities of $6,711 and $9,918, respectively, and long-term liabilities of $1,670 and $1,597, respectively.The Company provides assurance-type warranties to its customers. These warranties offer assurance that the related products will perform as intended and conform to agreed-upon specifications. Costs associated with these warranties are recognized in cost of products sold in the condensed consolidated statements of operations.

4. Restructuring

On an ongoing basis, the Company evaluates its business and objectives to ensure it is appropriately structured and sized in response to changing market conditions. As