Company: AOSL
Filing Date: 2025-02-06
Form Type: 10-Q
Source: 0001387467-25-000017
Chunk: 63

Company: ALPHA & OMEGA SEMICONDUCTOR Ltd
Filing Date: 2025-02-06
Form: 10-Q
Item: Item 8
Chunk 63
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 period of the commission asset the Company would have otherwise recognized is less than one year. Packaging and testing services revenue is recognized at a point in time upon shipment of serviced products to the customer.  License and Development Revenue Recognition In February 2023, the Company entered into a license agreement with a customer, pursuant to which the Company agreed to license its proprietary Silicon Carbide (SiC) technology to the customer and engineering and development services for 24 months for a total fee of $45.0 million, consisting of an upfront fee and various milestone payments over the 24 months.  In addition, the Company also entered into an accompanying supply agreement to provide limited wafer supply to the customer. The license and development fee is determined to be one performance obligation and is recognized over the 24 months during which the Company performs the engineering and development services.  The Company uses the input method to measure progress and recognize revenue, based on the effort expended relative to the estimated total effort to satisfy the performance obligation.  The Company recognizes a contract liability when payments are in excess of revenue recognized, which is presented as deferred revenue on the balance sheet.  When the Company’s performance under the contract precedes its receipt of consideration from the customer, and the receipt of consideration is conditional upon factors other than the passage of time, a contract asset is recorded.  During the six months ended December 31, 2024, the Company recorded license and development revenue of $2.6 million that was previously included in the deferred revenue balance as of June 30, 2024.  During the six months ended December 31, 2024, the Company recognized license and development revenue of $8.5 million that precedes its receipt of payments, resulting in a balance of $8.5 million of contract assets as of December 31, 2024.  As of December 31, 2024, the Company had recorded a total of $42.2 million of license and development revenue.During the three and six months ended December 31, 2024, the Company recorded license and development revenue of $5.4 million and $11.0 million, respectively.  During the three and six months ended December 31, 2023, the Company recorded license and development revenue of $5.5 million and $11.1 million, respectively.  Restricted CashThe Company maintains restricted cash in connection with cash balances temporarily restricted by the local custom authority for regular business operations.