Company: KVHI
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001007587-25-000008
Chunk: 55

Company: KVH INDUSTRIES INC \DE\
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 8
Chunk 55
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 with Customers

In accordance with ASC 606, revenue is recognized when a customer obtains control of promised products and services. The amount of revenue recognized reflects the consideration which the Company expects to be entitled to receive in exchange for these products and services.Disaggregation of RevenueThe following table summarizes net sales from contracts with customers for the three months ended March 31, 2025 and 2024:Three Months EndedMarch 31,20252024Service - over time$21,642 $25,038 Product - point in time3,772 4,229  Total net sales$25,414 $29,267 For product sales, the delivery of the Company’s performance obligations is generally transferred to the customer, and associated revenue is recognized, at a point in time. For service sales, the delivery of the Company’s performance obligations is transferred to the customer, and associated revenue is recognized, over time. Revenues for these service agreements are recognized over time using an output method based upon the passage of time, as this provides a faithful depiction of the pattern of transfer of control. The Company's performance is impacted by the levels of activity in the marine and land mobile markets, among other factors. Performance in any particular period could be impacted by the timing of sales to certain large customers.

17

The Company offers a comprehensive family of mobile satellite antenna services and products that provide access to the Internet, television, and VoIP services while on the move. Service sales of airtime service accounted for approximately 79% and 81% of the Company's consolidated net sales for the three months ended March 31, 2025 and 2024, respectively. The balance of service sales are comprised of distribution of commercially licensed entertainment and news, product repairs, and extended warranty sales. Product sales accounted for 15% and 14% of the Company's consolidated net sales for the three months ended March 31, 2025 and 2024, respectively.No other single product class accounts for 10% or more of the Company's consolidated net sales.The Company operates in a number of major geographic areas, including internationally. Revenues from international locations primarily include Singapore, Canada, South American countries, European Union countries and other European countries, and countries in Africa, the Middle East and Asia/Pacific, including India. Revenues are based upon customer location, and revenues from international locations represented 80% and 72% of consolidated net sales for the three months ended March 31, 2025 and 202