National Vision Holdings Inc

9. Revenue from Contracts with Customers

The majority of our revenues are recognized either at the point of sale or upon delivery and customer acceptance, paid for at the time of sale in cash, credit card, or on account with managed care payors having terms generally between 14 and 120 days, with most paying within 90 days. For sales of in-store non-prescription eyewear and related accessories, and paid eye exams, we recognize revenue at the point of sale. Our point in time revenues include 1) retail sales of prescription and non-prescription eyewear, contact lenses and related accessories to retail customers (including those covered by managed care) and 2) eye exams. Revenues recognized over time primarily include product protection plans (i.e. warranties) and eye care club memberships.

The following disaggregation of revenues depicts our revenue based on the timing of revenue recognition:

Refer to Note 12. “Segment Reporting” for the Company’s disaggregation of net revenue among the Owned & Host reportable segment, as well as the Corporate/Other and Reconciliation categories. As our reportable segment is aligned by similar economic factors, trends and customers, the reportable segment disaggregation view best depicts how the nature, amount and uncertainty of revenue and cash flows are affected by economic factors.

We record reductions in revenue for estimated price concessions granted to managed care providers. The Company considers its revenue from managed care customers to include variable consideration and estimates such amounts associated with managed care customer revenues using the history of concessions provided and cash receipts from managed care providers. We reduced our net revenue for variable consideration of $5.5 million and $3.7 million during the three months ended September 28, 2024 and September 30, 2023, respectively, and $12.5 million and $10.8 million during the nine months ended September 28, 2024 and September 30, 2023, respectively.

Accounts Receivable

Credit loss expense recognized on our receivables, which is presented in SG&A expenses in the Company’s Condensed Consolidated Statements of Operations, wasimmaterial for the three months ended September 28, 2024, and $0.1 million for the three months ended September 30, 2023, and $0.2 million and $0.4 million for the nine months ended September 28, 2024 and September 30, 2023, respectively.

Unsatisfied Performance Obligations (Contract Liabilities)

During the three months ended September 28, 2024 and September 30, 2023, we recognized $23.1 million and $23.1 million, respectively, of deferred revenues outstanding at the beginning of each respective period. During the nine months ended September 28, 2024 and September 30, 2023, we recognized $54.4 million and $53.7 million, respectively, of deferred revenues outstanding at the beginning of each respective period.

Our deferred revenue balance as of September 28, 2024 and December 30, 2023 was $86.6 million and $84.3 million, respectively. We expect future revenue recognition of the September 28, 2024 balance of $43.4 million, $26.2 million, $13.8 million and $3.2 million in fiscal years 2024, 2025, 2026 and 2027, respectively.