AstroNova, Inc. Revenue Disclosure

Note 3—Revenue Recognition

We derive revenue from the sale of (i) hardware, including digital color label printers and specialty OEM printing systems, portable data acquisition systems and airborne printers used in the flight deck and interior of commercial, business and military aircraft, (ii) related consumable supplies including paper, labels, tags, inks, toners and ribbons, (iii) repairs and maintenance of equipment and (iv) service agreements.

Revenue for the years ended January 31, 2025 and January 31, 2024 included approximately $0.8 million and $1.3 million, respectively, recognized under an amended customer contract with one of our Aerospace customers, which was executed in December 2022 related to claims for incremental component costs incurred through fiscal 2025. The arrangement was fully settled, and no amounts were recognized or deferred as of January 31, 2026.

Contract Assets and Liabilities

We normally do not have contract assets, which are primarily unbilled accounts receivable that are conditional on something other than the passage of time.

Our contract liabilities, which represent billings in excess of revenue recognized, are related to advanced billings for purchased service agreements and extended warranties. Contract liabilities were $489,000 and $543,000 at January 31, 2026 and January 31, 2025, respectively, and are recorded as current deferred revenue in the accompanying consolidated balance sheets The decrease in the deferred revenue balance for the year ended January 31, 2026 is due to revenue recognized during the period, including $522,000 of revenue that was included in the deferred revenue balance at January 31, 2025, in excess of cash payments received in advance of satisfying performance obligations for the current year.

In fiscal 2026, we entered into an agreement with a customer to support the production ramp‑up of one of our Aerospace product lines. Under the terms of the agreement, the customer made an advance payment of $1.1 million, representing 50% of the contractual unit selling price for units scheduled for delivery beginning in June 2025. The advance payment was initially recorded as deferred revenue and recognized as revenue upon delivery of the related units. For the year ended January 31, 2026, we recognized the full $1.1 million of revenue associated with this arrangement, and no amount remained recorded as deferred revenue as of January 31, 2026.

Contract Costs

We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. We have determined that certain costs related to obtaining sales contracts for our aerospace printer products meet the requirement to be capitalized. These costs are deferred and amortized over the remaining useful life of these contracts, which we currently estimate to be approximately 15 years as of January 31, 2026. Amortized contract costs for the year ended January 31, 2026 were $93,000 and $88,000 and $75,000 for the years ended January 31, 2025 and 2024, respectively. The balance of deferred incremental direct costs net of accumulated amortization at January 31, 2026, was $1.4 million, of which $0.1 million is reported in other current assets and $1.3 million is reported in other assets in the accompanying consolidated balance sheet.