Workhorse Group Inc.WKHS

Workhorse Group Inc. Revenue Disclosure

10-KFiled Mar 1, 20232 min read
REVENUE
The following table provides a summary of sales activity:
Years Ended
December 31,
2022
2021
2020
Sales, net of returns and allowances
$4,385,975 $(994,187)$1,357,157 
Other sales
637,097 142,265 35,362 
Total sales, net of returns and allowances
$5,023,072 $(851,922)$1,392,519 

The majority of sales recognized during 2022 relate to the Company's vehicle sales, primarily of sales of W4 CC vehicles, while the other sales consist of delivery service, parts sales and other services.

During 2021, the Company announced its decision to suspend deliveries of our C1000 vehicles and recall previously delivered vehicles. In connection with the recall, the Company agreed to refund our customers for all C1000 vehicles previously purchased by them. The Company determines its allowance for estimated returns based on known pending returns and historical trends in product returns. The refund liability as of December 31, 2022 and 2021 was zero and $2.4 million, respectively.

The Company also records an asset for our right to recover products from customers settling a refund liability. The Company measures the asset at the asset's former carrying amount, less any expected costs to recover, and updates the measurement of the asset arising from changes in expectations about products to be returned. The asset for recovery as of December 31, 2022 and 2021 was zero and $1.6 million, respectively.

Deferred revenue, which is equivalent to the total service fee allocated to the assembly service performance obligations that are unsatisfied as of the balance sheet date, was $5.4 million and zero as of December 31, 2022 and 2021, respectively.
Of the total deferred revenue for assembly services, we expect to recognize $3.4 million of revenue in the next 12 months.

Historical Timeline

Fiscal YearFiled
2022Mar 1, 2023Showing above
2021Mar 1, 2022
2020Mar 1, 2021
2019Mar 13, 2020
2018Mar 18, 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.

Other Available Disclosures

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