BWX Technologies, Inc.BWXT
BWX Technologies, Inc. Revenue Disclosure
REVENUE RECOGNITION
Contracts and Revenue Recognition
Government Operations
Our Government Operations segment recognizes revenue over time for the manufacturing of naval nuclear reactor components and fuel, the downblending of high-enriched uranium and the development of advanced nuclear reactors for power and propulsion applications. Certain of our contracts contain two or more different types of components, each of which we identify as a separate performance obligation. We recognize revenue using a cost-to-cost method to measure progress as control is continually transferred to the customer as we incur costs on the performance obligations. We determine the stand-alone selling price of our performance obligations based on the expected cost plus margin approach. We allocate revenue to the individual performance obligations within contracts with multiple performance obligations based on the stand-alone selling price of the individual performance obligations.
Our fixed-price incentive fee contracts include incentives that we concluded to be variable consideration. The amount of the variable consideration to which we are entitled is dependent on our actual costs incurred on the performance obligation compared to the target costs for that performance obligation and subject to incentive price revisions included within the contracts. We include these incentive fees in revenue when there is sufficient evidence to determine that the variable consideration is not constrained. The remaining contracts typically have immaterial amounts of variable consideration and have a single performance obligation. Our estimates of variable consideration and total estimated costs at completion are determined through a detailed process based on historical performance and our expertise using the most likely method. Variations from estimated contract performance could result in a material effect on our financial condition and results of operations in future periods.
Our Government Operations segment's contracts primarily allow for billings as costs are incurred, subject to certain retainages that require milestones to be reached for the remaining consideration to be paid. Our fuel and downblending contracts allow billing when we achieve certain milestones related to our progress.
Commercial Operations
Our Commercial Operations segment recognizes revenue over time using a cost-to-cost method for the manufacturing of large components, non-standard parts, fuel bundles and service contracts as control continually transfers to the customers. For standard parts, revenue is recognized at the point in time control transfers to the customer, which is consistent with the transfer of ownership. For medical radioisotopes, we recognize revenue either at the point in time control transfers to the customer or over time using a unit of output method. This segment generates revenue primarily from firm-fixed-price contracts that do not contain variable consideration as well as time-and-materials based contracts. Certain of these contracts contain assurance warranties and/or provisions for liquidated damages, which are expected to have an immaterial impact to the contracts based on our historical experience. We are entitled to payment on the majority of our Commercial Operations segment contracts when we achieve certain milestones related to our progress.
Disaggregated Revenues
We allocate geographic revenues based on the location of the customers' operations. Revenues by geographic area and customer type were as follows:
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | Year Ended December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Government Operations | Commercial Operations | Total | Government Operations | Commercial Operations | Total | Government Operations | Commercial Operations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| United States: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Government | $ | 2,199,677 | $ | 321 | $ | 2,199,998 | $ | 2,068,239 | $ | — | $ | 2,068,239 | $ | 1,884,671 | $ | — | $ | 1,884,671 | ||||||||||||||||||||||||||||||||||||||
| Non-Government | 123,931 | 107,395 | 231,326 | 86,012 | 75,954 | 161,966 | 123,604 | 57,654 | 181,258 | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | 2,323,608 | $ | 107,716 | $ | 2,431,324 | $ | 2,154,251 | $ | 75,954 | $ | 2,230,205 | $ | 2,008,275 | $ | 57,654 | $ | 2,065,929 | |||||||||||||||||||||||||||||||||||||||
| Canada: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Government | $ | 3,619 | $ | — | $ | 3,619 | $ | 127 | $ | — | $ | 127 | $ | 245 | $ | — | $ | 245 | ||||||||||||||||||||||||||||||||||||||
| Non-Government | 126 | 684,864 | 684,990 | 747 | 430,385 | 431,132 | 778 | 389,234 | 390,012 | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | 3,745 | $ | 684,864 | $ | 688,609 | $ | 874 | $ | 430,385 | $ | 431,259 | $ | 1,023 | $ | 389,234 | $ | 390,257 | |||||||||||||||||||||||||||||||||||||||
| Other: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Government | $ | 15,731 | $ | — | $ | 15,731 | $ | 12,165 | $ | — | $ | 12,165 | $ | 10,016 | $ | — | $ | 10,016 | ||||||||||||||||||||||||||||||||||||||
| Non-Government | 7,006 | 60,490 | 67,496 | 15,750 | 17,633 | 33,383 | 12,023 | 19,456 | 31,479 | |||||||||||||||||||||||||||||||||||||||||||||||
| $ | 22,737 | $ | 60,490 | $ | 83,227 | $ | 27,915 | $ | 17,633 | $ | 45,548 | $ | 22,039 | $ | 19,456 | $ | 41,495 | |||||||||||||||||||||||||||||||||||||||
| Segment Revenues | $ | 2,350,090 | $ | 853,070 | 3,203,160 | $ | 2,183,040 | $ | 523,972 | 2,707,012 | $ | 2,031,337 | $ | 466,344 | 2,497,681 | |||||||||||||||||||||||||||||||||||||||||
| Eliminations | (4,735) | (3,358) | (1,372) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | $ | 3,198,425 | $ | 2,703,654 | $ | 2,496,309 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues by timing of transfer of goods or services were as follows:
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | Year Ended December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Government Operations | Commercial Operations | Total | Government Operations | Commercial Operations | Total | Government Operations | Commercial Operations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Over time | $ | 2,337,024 | $ | 721,089 | $ | 3,058,113 | $ | 2,175,010 | $ | 439,504 | $ | 2,614,514 | $ | 2,012,949 | $ | 392,060 | $ | 2,405,009 | ||||||||||||||||||||||||||||||||||||||
| Point-in-time | 13,066 | 131,981 | 145,047 | 8,030 | 84,468 | 92,498 | 18,388 | 74,284 | 92,672 | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment Revenues | $ | 2,350,090 | $ | 853,070 | 3,203,160 | $ | 2,183,040 | $ | 523,972 | 2,707,012 | $ | 2,031,337 | $ | 466,344 | 2,497,681 | |||||||||||||||||||||||||||||||||||||||||
| Eliminations | (4,735) | (3,358) | (1,372) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | $ | 3,198,425 | $ | 2,703,654 | $ | 2,496,309 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues by contract type were as follows:
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | Year Ended December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Government Operations | Commercial Operations | Total | Government Operations | Commercial Operations | Total | Government Operations | Commercial Operations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fixed-Price Incentive Fee | $ | 894,366 | $ | 10,334 | $ | 904,700 | $ | 1,173,728 | $ | 17,379 | $ | 1,191,107 | $ | 1,218,516 | $ | 11,119 | $ | 1,229,635 | ||||||||||||||||||||||||||||||||||||||
| Firm-Fixed-Price | 1,042,344 | 539,702 | 1,582,046 | 590,884 | 315,061 | 905,945 | 469,138 | 312,236 | 781,374 | |||||||||||||||||||||||||||||||||||||||||||||||
| Cost-Plus Fee | 412,701 | 7,817 | 420,518 | 388,116 | — | 388,116 | 337,598 | — | 337,598 | |||||||||||||||||||||||||||||||||||||||||||||||
| Time-and-Materials | 679 | 295,217 | 295,896 | 30,312 | 191,532 | 221,844 | 6,085 | 142,989 | 149,074 | |||||||||||||||||||||||||||||||||||||||||||||||
| Segment Revenues | $ | 2,350,090 | $ | 853,070 | 3,203,160 | $ | 2,183,040 | $ | 523,972 | 2,707,012 | $ | 2,031,337 | $ | 466,344 | 2,497,681 | |||||||||||||||||||||||||||||||||||||||||
| Eliminations | (4,735) | (3,358) | (1,372) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Revenues | $ | 3,198,425 | $ | 2,703,654 | $ | 2,496,309 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Performance Obligations
As we progress on our contracts and the underlying performance obligations for which we recognize revenue over time, we refine our estimates of variable consideration and total estimated costs at completion, which impact the overall profitability on our contracts and performance obligations. Changes in these estimates result in the recognition of cumulative catch-up adjustments that impact our revenues and/or costs of contracts. The aggregate impact of changes in estimates increased our revenue and operating income as follows:
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In thousands) | ||||||||||||||||||||
| Revenues | $ | 5,544 | $ | 37,908 | $ | 24,728 | ||||||||||||||
Operating Income (1) | $ | 4,318 | $ | 36,770 | $ | 24,813 | ||||||||||||||
(1)During the year ended December 31, 2025, our Government Operations segment results were favorably impacted by material contract adjustments related to a nuclear operations contract. The material adjustments resulted in an increase in revenue and operating income of $29.4 million during the year ended December 31, 2025.
During the year ended December 31, 2024, no adjustments to any one contract had a material impact on our consolidated financial statements.
During the year ended December 31, 2023, our Government Operations segment results were favorably impacted by contract adjustments related to a nuclear operations contract which resulted in an increase in operating income of $22.5 million. Our Government Operations segment also recognized favorable adjustments totaling $27.9 million as a result of the successful negotiation of change orders related to cost growth that was driven by out-of-scope changes associated with the manufacture of non-nuclear components.
Contract Assets and Liabilities
We include revenues and related costs incurred, plus accumulated contract costs that exceed amounts invoiced to customers under the terms of the contracts, in Contracts in progress. Costs specific to certain contracts for which we recognize revenue at a point in time are also included in Contracts in progress. We include in Advance billings on contracts billings that exceed accumulated contract costs and revenues and costs recognized over time. In accordance with contract terms, certain amounts that are withheld by our customers and are classified within Retainages. Certain of these amounts require conditions other than the passage of time to be achieved, with the remaining amounts only requiring the passage of time. Most long-term contracts contain provisions for progress payments. Our unbilled receivables do not contain an allowance for credit losses as we expect to invoice customers and collect all amounts for unbilled receivables. Changes in Contracts in progress and Advance billings on contracts are primarily driven by differences in the timing of revenue recognition and billings to our customers. During the year ended December 31, 2025, our unbilled receivables increased $35.3 million primarily as a result of decreases in cost in excess of billings on our fixed-price incentive fee contracts and the timing of milestone billings on certain firm-fixed-price contracts within our Government Operations segment, partially offset by increases due to the timing of milestone billings on firm-fixed-price contracts within our Commercial Operations segments. During the year ended December 31, 2025, our Advance billings on contracts increased $144.0 million primarily as a result of revenue recognized in excess of billings on certain firm-fixed-price contracts within our Government Operations segment. Certain contracts within our Government Operations segment include provisions that result in an increase in retainages on contracts during the first and third quarters of the year, with larger payments made during the second and fourth quarters. Retainages also vary as a result of timing differences between incurring costs and achieving milestones that allow us to recover these amounts.
| December 31, | December 31, | |||||||||||||
| 2025 | 2024 | |||||||||||||
| (In thousands) | ||||||||||||||
| Included in Contracts in progress: | ||||||||||||||
| Unbilled receivables | $ | 594,749 | $ | 559,415 | ||||||||||
| Retainages | $ | 46,311 | $ | 33,667 | ||||||||||
| Advance billings on contracts | $ | 305,285 | $ | 161,290 | ||||||||||
During the years ended December 31, 2025 and 2024, we recognized $150.5 million and $87.0 million of revenue that was in Advance billings on contracts at the beginning of each year, respectively.
Remaining Performance Obligations
Remaining performance obligations represent the dollar amount of revenue we expect to recognize in the future from performance obligations on contracts previously awarded and in progress. Our backlog is equal to our remaining performance obligations under contracts that meet the criteria in FASB Topic Revenue from Contracts with Customers. At December 31, 2025, our ending backlog was $7,260.7 million, which included $2,151.3 million of unfunded backlog related to U.S. Government contracts. We expect to recognize approximately 40% of the revenue associated with our backlog by the end of 2026, with the remainder to be recognized thereafter.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 23, 2026 | Showing above |
| 2024 | Feb 24, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 22, 2022 | |
| 2020 | Feb 22, 2021 | |
| 2019 | Feb 24, 2020 | |
| 2018 | Feb 25, 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.