Company: OCC
Filing Date: 2025-06-05
Form Type: 10-Q
Source: 0001437749-25-019494
Chunk: 33

Company: OPTICAL CABLE CORP
Filing Date: 2025-06-05
Form: 10-Q
Item: Item 1
Chunk 33
---
 governmental entities and not‑for‑profit organizations. Concentration of credit risk with respect to trade receivables is normally limited due to the Company’s large number of customers.  The Company also manages exposure to credit risk through credit approvals, credit limits and monitoring procedures. Management believes that credit risks as of April 30, 2025 have been adequately provided for in the condensed consolidated financial statements.  The Company includes all entities under common ownership for the purpose of calculating business concentrations.

For the three months and six months ended April 30, 2025, 22.5% and 18.7%, respectively, of consolidated net sales were attributable to one distributor customer. For the three months and six months ended April 30, 2024, 16.3% and 15.9%, respectively, of consolidated net sales were attributable to one distributor customer.

The Company has a single reportable segment for purposes of segment reporting.

12

OPTICAL CABLE CORPORATION

Condensed Notes to Condensed Consolidated Financial Statements

Six Months Ended April 30, 2025

(Unaudited)

			(11)

			Revenue Recognition

Revenues consist of product sales that are recognized at a specific point in time under the core principle of recognizing revenue when control transfers to the customer.  The Company considers customer purchase orders, governed by master sales agreements or the Company’s standard terms and conditions, to be the contract with the customer.  For each contract, the promise to transfer the control of the products, each of which is individually distinct, is considered to be the identified performance obligation. The Company evaluates each customer’s credit risk when determining whether to accept a contract.

In determining transaction prices, the Company evaluates whether fixed order prices are subject to adjustment to determine the net consideration to which the Company expects to be entitled. Contracts do not include financing components, as payment terms are generally due 30 to 90 days after shipment. Taxes assessed by governmental authorities and collected from the customer including, but not limited to, sales and use taxes and value-added taxes, are not included in the transaction price and are not included in net sales.  

The Company recognizes revenue at the point in time when products are shipped or delivered from its manufacturing facility to its customer, in accordance with the agreed-upon shipping terms.  Since the Company typically invoices the customer at the same time that performance obligations are satisfied, no contract assets are recognized. The Company’s contract liability represents advance consideration received from customers prior to transfer of the