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| Revenues | Revenues The Company recognizes revenue to depict the transfer of goods, services, or software solutions to a customer at an amount that reflects the consideration which it expects to receive. Revenues for tangible products are generally recognized upon shipment, whereas revenues for services are generally recognized over time by using an output or time-based method, assuming all other criteria for revenue recognition have been met. Revenues for software are recognized either upon delivery or over time using a time-based method, depending on how control is transferred to the customer. In cases where a bundle of products, services, and/or software are delivered to the customer, judgment is required to select the method of progress which best reflects the transfer of control. Disaggregation of Revenue The following table presents our Net sales disaggregated by product category for each of our segments (in millions):
In addition, refer to Note 16, Segment Information & Geographic Data for Net sales to customers by geographic region. Performance Obligations The Company’s remaining performance obligations relate to services and software solutions. The aggregated transaction price allocated to remaining performance obligations for arrangements with an original term exceeding one year was $1.17 billion and $1.19 billion, inclusive of deferred revenue, as of June 28, 2025 and December 31, 2024, respectively. On average, remaining performance obligations as of June 28, 2025 and December 31, 2024 are expected to be recognized over a period of approximately two years. Contract Balances Progress on satisfying performance obligations under contracts with customers related to billed revenues is reflected on the Consolidated Balance Sheets in Accounts receivable, net. Progress on satisfying performance obligations under contracts with customers related to unbilled revenues (“contract assets”) is reflected on the Consolidated Balance Sheets as Prepaid expenses and other current assets for revenues expected to be billed within the next twelve months, and Other long-term assets for revenues expected to be billed thereafter. The total contract asset balances were $10 million and $11 million as of June 28, 2025 and December 31, 2024, respectively. These contract assets result from timing differences between billing and satisfying performance obligations, inclusive of any impacts from the allocation of the transaction price among performance obligations for contracts that include multiple performance obligations. Contract assets are evaluated for impairment, and no impairment losses have been recognized during the three and six months ended June 28, 2025 and June 29, 2024, respectively. Deferred revenue on the Consolidated Balance Sheets consists of payments and billings in advance of our performance. The combined short-term and long-term deferred revenue balances were $772 million and $757 million as of June 28, 2025 and December 31, 2024, respectively. During the three and six months ended June 28, 2025, the Company recognized $117 million and $258 million in revenue, which was previously included in the beginning balance of deferred revenue as of December 31, 2024. During the three and six months ended June 29, 2024, the Company recognized $121 million and $267 million in revenue, which was previously included in the beginning balance of deferred revenue as of December 31, 2023.
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