| NET SALES |
NOTE
3. NET SALES
Revenue
Recognition
Revenue
under contract manufacturing agreements that was recognized over time, excluding noncash consideration, accounted for 68% and 71% of
net sales for the three and six months ended June 30, 2026, respectively, and 75% of net sales for both the three and six months ended
June 30, 2025. The following tables summarize our net sales by market for the three and six months ended June 30, 2026 and 2025, respectively:
SCHEDULE
OF NET SALES BY MARKET
| | |
| | |
| | |
| | |
| |
| | |
Three Months Ended June 30, 2026 | |
| | |
Product/ Service Transferred Over Time | | |
Product Transferred at Point in Time | | |
Noncash Consideration1 | | |
Total Net Sales by Market | |
| Medical Device | |
$ | 7,252 | | |
$ | 1,882 | | |
$ | 1,135 | | |
$ | 10,269 | |
| Medical Imaging | |
| 8,478 | | |
| 2,358 | | |
| 5 | | |
| 10,841 | |
| Industrial | |
| 3,846 | | |
| 4,198 | | |
| 76 | | |
| 8,120 | |
| Aerospace and Defense | |
| 3,390 | | |
| 916 | | |
| 4 | | |
| 4,310 | |
| Total net sales | |
$ | 22,966 | | |
$ | 9,354 | | |
$ | 1,220 | | |
$ | 33,540 | |
| | |
| | |
| | |
1 | | |
| |
| | |
Three Months Ended June 30, 2025 | |
| | |
Product/ Service Transferred Over Time | | |
Product Transferred at Point in Time | | |
Noncash Consideration1 | | |
Total Net Sales by Market | |
| Medical Device | |
$ | 5,049 | | |
$ | 2,004 | | |
$ | 497 | | |
$ | 7,550 | |
| Medical Imaging | |
| 7,490 | | |
| 2,169 | | |
| 5 | | |
| 9,664 | |
| Industrial | |
| 6,590 | | |
| 1,799 | | |
| 127 | | |
| 8,516 | |
| Aerospace and Defense | |
| 3,975 | | |
| 886 | | |
| 84 | | |
| 4,945 | |
| Total net sales | |
$ | 23,104 | | |
$ | 6,858 | | |
$ | 713 | | |
$ | 30,675 | |
| | |
| | |
| | |
1 | | |
| |
| | |
Six Months Ended June 30, 2026 | |
| | |
Product/ Service Transferred Over Time | | |
Product Transferred at Point in Time | | |
Noncash Consideration1 | | |
Total Net Sales by Market | |
| Medical Device | |
$ | 13,931 | | |
$ | 3,372 | | |
$ | 1,877 | | |
$ | 19,180 | |
| Medical Imaging | |
| 16,484 | | |
| 4,225 | | |
| 8 | | |
| 20,717 | |
| Industrial | |
| 7,535 | | |
| 7,216 | | |
| 251 | | |
| 15,002 | |
| Aerospace and Defense | |
| 7,644 | | |
| 1,272 | | |
| 41 | | |
| 8,957 | |
| Total net sales | |
$ | 45,594 | | |
$ | 16,085 | | |
$ | 2,177 | | |
$ | 63,856 | |
| | |
| | |
| | |
1 | | |
| |
| | |
Six Months Ended June 30, 2025 | |
| | |
Product/ Service Transferred Over Time | | |
Product Transferred at Point in Time | | |
Noncash Consideration1 | | |
Total Net Sales by Market | |
| Medical Device | |
$ | 10,821 | | |
$ | 3,734 | | |
$ | 1,065 | | |
$ | 15,620 | |
| Medical Imaging | |
| 14,198 | | |
| 4,042 | | |
| 12 | | |
| 18,252 | |
| Industrial | |
| 11,296 | | |
| 3,931 | | |
| 234 | | |
| 15,461 | |
| Aerospace and Defense | |
| 6,757 | | |
| 1,364 | | |
| 116 | | |
| 8,237 | |
| Total net sales | |
$ | 43,072 | | |
$ | 13,071 | | |
$ | 1,427 | | |
$ | 57,570 | |
| 1 |
Noncash
consideration represents material provided by the customer used in the manufacturing of the product. |
Contract
Assets
Contract
assets, recorded in the condensed consolidated balance sheets, consist of unbilled amounts related to revenue recognized over time. Significant
changes in the contract assets balance during the six months ended June 30, 2026 were as follows:
SCHEDULE
OF CONTRACT ASSETS
| Balance as of December 31, 2025 | |
$ | 15,184 | |
| Increase (decrease) attributed to: | |
| | |
| Amounts transferred over time to contract assets | |
| 45,594 | |
| Allowance for current expected credit losses | |
| - | |
| Amounts invoiced during the period | |
| (43,799 | ) |
| Balance outstanding as of June 30, 2026 | |
$ | 16,979 | |
We expect substantially all amounts recorded as contract assets as of June 30, 2026 to be billed and reclassified to accounts receivable
within 90 days, with any remaining amounts expected to be billed and reclassified within 180 days. We bill our customers upon shipment with
payment terms of up to 120 days.
Contract
Liabilities
Contract
liabilities, recorded as customer deposits, were $6,848 and $5,386 at June 30, 2026 and December 31, 2025, respectively. Contract liabilities
primarily relate to customer prepayments, generally to purchase customer-specific inventory, and billings in advance of the Company satisfying
its performance obligations. Revenue recognized during the three and six months ended June 30, 2026 that was included in the contract
liability balance at January 1, 2026 was $905 and $1,470, respectively. Changes between periods represent the timing of customer deposits
and the satisfaction of performance obligations.
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