AIR T INCAIRT
AIR T INC Revenue Disclosure
REVENUE RECOGNITION
Performance Obligations
Substantially all of the Company’s non-lease revenue is derived from contracts with an initial expected duration of one year or less. As a result, the Company has applied the practical expedient to exclude consideration of significant financing components from the determination of transaction price, to expense costs incurred to obtain a contract, and to not disclose the value of unsatisfied performance obligations.
The following is a description of the Company’s performance obligations as of March 31, 2025:
| Type of Revenue | Nature, Timing of Satisfaction of Performance Obligations, and Significant Payment Terms | ||||
| Product Sales | The Company generates revenue from sales of various distinct products such as parts, aircraft equipment, printing equipment, jet engines, airframes, and scrap metal to its customers. A performance obligation is created when the Company accepts an order from a customer to provide a specified product. Each product ordered by a customer represents a performance obligation. The Company recognizes revenue when obligations under the terms of the contract are satisfied; generally, this occurs at a point-in-time upon shipment or when control is transferred to the customer. Transaction prices are based on contracted terms, which are at fixed amounts based on standalone selling prices. While the majority of the Company's contracts do not have variable consideration, for the limited number of contracts that do, the Company records revenue based on the standalone selling price less an estimate of variable consideration (such as rebates, discounts or prompt payment discounts). The Company estimates these amounts based on the expected incentive amount to be provided to customers and reduces revenue accordingly. Performance obligations are short-term in nature and customers are typically billed upon transfer of control. The Company records all shipping and handling fees billed to customers as revenue. The terms and conditions of the customer purchase orders or contracts are dictated by either the Company’s standard terms and conditions or by a master service agreement or by the contract. | ||||
| Support Services | The Company provides a variety of support services such as aircraft maintenance, printer maintenance, and short-term repair services to its customers. Additionally, the Company operates certain aircraft routes on behalf of FedEx. A performance obligation is created when the Company agrees to provide a particular service to a customer. For each service, the Company recognizes revenues over time as the customer simultaneously receives the benefits provided by the Company's performance. This revenue recognition can vary from when the Company has a right to invoice to the output or input method depending on the structure of the contract and management’s analysis. For repair-type services, the Company records revenue over-time based on an input method of costs incurred to total estimated costs. The Company believes this is appropriate as the Company is performing labor hours and installing parts to enhance an asset that the customer controls. The vast majority of repair-services are short term in nature and are typically billed upon completion of the service. Some of the Company’s contracts contain a promise to stand ready as the Company is obligated to perform certain maintenance or administrative services. For most of these contracts, the Company applies the 'as invoiced' practical expedient as the Company has a right to consideration from the customer in an amount that corresponds directly with the value of the entity's performance completed to date. A small number of contracts are accounted for as a series and recognized equal to the amount of consideration the Company is entitled to less an estimate of variable consideration (typically rebates). These services are typically ongoing and are generally billed on a monthly basis. | ||||
| Software Services | The Company provides market data related to air cargo based on primary sources and owns cloud hosted software that supports the needs of aviation businesses and helps aftermarket parts sellers automate quoting for their potential clients. For market data services, revenue is derived from contracts that grant customers the right to use the Company's web-based service for a specified term through a subscription fee. A performance obligation is created when the Company agrees to provide a subscription-based service to a customer. There is no variation in effort expanded by the Company over the subscription term, therefore, revenue is recognized each month on a straight-line basis according to the consideration paid by the customer for the given time period. Generally, subscription terms are in annual increments and, when a subscription term begins, an annual fee is remitted by the customer to cover the 12-month period. The cash received is recorded as deferred revenue for the amount stated in the contract and recognized over the subscription term based on straight-line recognition. For cloud hosted software, the Company enters into service contracts which provides access to the software and customer support services. A performance obligation is created when the Company agrees to provide a particular service to a customer. For software access, revenue is recognized ratably over time for the daily performance obligation related to the customer's access to the cloud hosted software. For support services, revenue is recognized over time for the hourly performance obligation provided to the customer. Generally, subscription terms range from to five years. Software access is usually billed monthly and support services are billed upon completion. | ||||
The following table summarizes disaggregated revenues by type (in thousands):
| Year Ended March 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Product Sales | |||||||||||
| Overnight air cargo | $ | 42,615 | $ | 39,302 | |||||||
| Ground support equipment | 35,903 | 36,127 | |||||||||
| Commercial aircraft, engines and parts | 106,946 | 114,049 | |||||||||
| Corporate and other | 661 | 739 | |||||||||
| Support Services | |||||||||||
| Overnight air cargo | 81,287 | 76,107 | |||||||||
| Ground support equipment | 2,426 | 533 | |||||||||
| Commercial aircraft, engines and parts | 7,923 | 10,727 | |||||||||
| Corporate and other | 31 | 36 | |||||||||
| Leasing Revenue | |||||||||||
| Ground support equipment | 69 | 49 | |||||||||
| Commercial aircraft, engines and parts | 2,597 | 64 | |||||||||
| Corporate and other | 1,713 | 1,624 | |||||||||
| Software Services | |||||||||||
| Digital Solutions | 7,268 | 5,783 | |||||||||
| Other | |||||||||||
| Overnight air cargo | 129 | 137 | |||||||||
| Ground support equipment | 542 | 459 | |||||||||
| Commercial aircraft, engines and parts | 749 | 695 | |||||||||
| Corporate and other | 991 | 403 | |||||||||
| Total | $ | 291,850 | $ | 286,834 | |||||||
See Note 18 for the Company's disaggregated revenues by geographic region and Note 19 for the Company’s disaggregated revenues by segment. These notes disaggregate revenue recognized from contracts with customers into categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.
Contract Balances and Costs
Contract liabilities relate to deferred revenue, our unconditional right to receive consideration in advance of performance with respect to subscription revenue and advanced customer deposits with respect to product sales. The following table presents outstanding contract liabilities as of April 1, 2024 and March 31, 2025 and the amount of contract liabilities that were recognized as revenue during the year ended March 31, 2025 (in thousands):
| Outstanding contract liabilities | Outstanding contract liabilities as of April 1, 2024 Recognized as Revenue | ||||||||||
| As of March 31, 2025 | $ | 4,199 | |||||||||
| As of April 1, 2024 | $ | 4,359 | |||||||||
| For the year ended March 31, 2025 | $ | (3,705) | |||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jun 27, 2025 | Showing above |
| 2024 | Jun 26, 2024 | |
| 2023 | Jun 27, 2023 | |
| 2022 | Jun 28, 2022 | |
| 2021 | Jun 25, 2021 | |
| 2020 | Jun 26, 2020 | |
| 2019 | Jun 28, 2019 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.