CVD EQUIPMENT CORP Revenue Disclosure
Note 3 – Revenue
The following table represents a disaggregation of revenue from contracts by end markets for the years ended December 31, 2025 and 2024 (in thousands):
| Year Ended December 31, 2025 | ||||||||||||
| Over time | Point in time | Total | ||||||||||
| Energy | $ | 68 | $ | 19 | $ | 87 | ||||||
| Aerospace | 5,767 | 2,205 | 7,972 | |||||||||
| Industrial | 10,097 | 1,472 | 11,569 | |||||||||
| Research | 4,909 | 1,249 | 6,158 | |||||||||
| Total | $ | 20,841 | $ | 4,945 | $ | 25,786 | ||||||
| Year Ended December 31, 2024 | ||||||||||||
| Over time | Point in time | Total | ||||||||||
| Energy | $ | 216 | $ | 511 | $ | 727 | ||||||
| Aerospace | 11,205 | 1,879 | 13,084 | |||||||||
| Industrial | 6,921 | 1,350 | 8,271 | |||||||||
| Research | 3,736 | 1,058 | 4,794 | |||||||||
| Total | $ | 22,078 | $ | 4,798 | $ | 26,876 | ||||||
The energy market includes customers involved in the manufacture of silicon carbide wafers and batteries. Aerospace market includes customers that manufacture aircraft engines. Industrial end market consists of various end customers in diverse industries. Research market principally represents customers that are universities and other research institutions.
The Company has unrecognized contract revenue of approximately $4.6 million at December 31, 2025, which it expects to substantially recognize as revenue within the next twelve months based on over time revenue recognition.
Judgment is required to evaluate assumptions including the amount of net contract revenues and the total estimated costs to determine the Company’s progress towards contract completion and to calculate the corresponding amount of revenue to recognize.
Changes in estimates for sales of systems occur for a variety of reasons, including but not limited to (i) build accelerations or delays, (ii) product cost forecast changes, (iii) cost related change orders or add-ons, or (iv) changes
in other information used to estimate costs. Changes in estimates may have a material effect on the Company’s consolidated financial position and results of operations.
CVD EQUIPMENT CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2025 and 2024
Note 3 – Revenue (continued)
Contract assets and contract liabilities on input method type contracts in progress are summarized for the years ended December 31, 2025 and 2024 as follows (in thousands):
| 2025 | 2024 | |||||||
| Costs incurred on contracts in progress | $ | 21,480 | $ | 14,696 | ||||
| Estimated earnings | 9,965 | 7,052 | ||||||
| 31,445 | 21,748 | |||||||
| Billings to date | (28,631 | ) | (22,059 | ) | ||||
| 2,814 | (311 | ) | ||||||
| Deferred revenue related to other contracts | (196 | ) | (598 | ) | ||||
| $ | 2,618 | $ | (909 | ) | ||||
| Included in accompanying consolidated balance sheets under the following captions (in thousands): | ||||||||
| Contract assets | $ | 3,391 | $ | 2,226 | ||||
| Contract liabilities | $ | 773 | $ | 3,135 | ||||
Of the contract liability balances at December 31, 2024 and December 31, 2023, $3.1 million and $4.9 million were recognized as revenue during the years ended December 31, 2025 and 2024, respectively. Contract assets and contract liabilities at December 31, 2023 were $1.6 million and $4.9 million, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 30, 2026 | Showing above |
| 2024 | Mar 19, 2025 | |
| 2023 | Mar 28, 2024 | |
| 2022 | Mar 27, 2023 | |
| 2021 | Mar 31, 2022 | |
| 2020 | Mar 31, 2021 | |
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.