Revenue Recognition Our net sales are derived from the sale of products and services and are adjusted for estimated returns and allowances, which historically have been insignificant. We recognize revenue when the obligations under the terms of a contract with our customers are satisfied; generally, this occurs with the transfer of control of our systems, non-system products or services. In circumstances where control is not transferred until destination or acceptance, we defer revenue recognition until such events occur. Revenue for established products that have previously satisfied a customers acceptance requirements is generally recognized upon shipment. In cases where a prior history of customer acceptance cannot be demonstrated or from sales where customer payment dates are not determinable and in the case of new products, revenue and cost of sales are deferred until customer acceptance has been received. Our post-shipment obligations typically include installation and standard warranties. The estimated fair value of installation related revenue is recognized in the period the installation is performed. Service revenue is recognized over time as we transfer control to our customer for the related contract or upon completion of the services if they are short-term in nature. Spares, contactor and kit revenue is generally recognized upon shipment. Certain of our equipment sales have multiple performance obligations. These arrangements involve the delivery or performance of multiple performance obligations, and transfer of control of performance obligations may occur at different points in time or over different periods of time. For arrangements containing multiple performance obligations, the revenue relating to the undelivered performance obligation is deferred using the relative standalone selling price method utilizing estimated sales prices until satisfaction of the deferred performance obligation. Unsatisfied performance obligations primarily represent contracts for products with future delivery dates. At June 29, 2019, we have $13.5 million of revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) for contracts with original expected durations of over one year. As allowed under ASC 606, we have opted to not disclose unsatisfied performance obligations for contracts with original expected durations of less than one year. We generally sell our equipment with a product warranty. The product warranty provides assurance to customers that delivered products are as specified in the contract (an assurance-type warranty). Therefore, we account for such product warranties under ASC 460, Guarantees (ASC 460 ), and not as a separate performance obligation. The transaction price reflects our expectations about the consideration we will be entitled to receive from the customer and may include fixed or variable amounts. Fixed consideration primarily includes sales to customers that are known as of the end of the reporting period. Variable consideration includes sales in which the amount of consideration that we will receive is unknown as of the end of a reporting period. Such consideration primarily includes sales made to certain customers with cumulative tier volume discounts offered. Variable consideration arrangements are rare; however, when they occur, we estimate variable consideration as the expected value to which we expect to be entitled. Included in the transaction price estimate are amounts in which it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Variable consideration that does not meet revenue recognition criteria is deferred. Our contracts are typically less than one year in duration and we have elected to use the practical expedient available in ASC 606 to expense cost to obtain contracts as they are incurred because they would be amortized over less than one year. Accounts receivable represents our unconditional right to receive consideration from our customer. Payments terms do not exceed one year from the invoice date and therefore do not include a significant financing component. To date, there have been no material impairment losses on accounts receivable. There were no material contract assets or contract liabilities recorded on the condensed consolidated balance sheet in any of the periods presented. On shipments where sales are not recognized, gross profit is generally recorded as deferred profit in our condensed consolidated balance sheet representing the difference between the receivable recorded and the inventory shipped. At June 29, 2019, we had deferred revenue totaling approximately $16.7 million, current deferred profit of $8.2 million and deferred profit expected to be recognized after one year included in noncurrent other accrued liabilities of $4.3 million. At December 29, 2018, we had deferred revenue totaling approximately $10.8 million, current deferred profit of $6.9 million and deferred profit expected to be recognized after one year included in noncurrent other accrued liabilities of $2.0 million. Net sales of our reportable segments, by type, are as follows (in thousands): Three Months Ended Six Months Ended Net Sales (1) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Systems: Semiconductor Test &amp; Inspection $ 76,155 $ 55,663 $ 156,095 $ 110,568 PCB Test 8,407 N/A 15,379 N/A Non-systems: Semiconductor Test &amp; Inspection 61,424 44,154 118,177 84,399 PCB Test 4,025 N/A 8,169 N/A Total net sales $ 150,011 $ 99,817 $ 297,820 $ 194,967 ( 1 ) After the acquisition of Xcerra on October 1, 2018 we report in two segments, Semiconductor Test &amp; Inspection and PCB Test. Cohus historical reported net sales would have been reported in our Semiconductor Test &amp; Inspection segment and have been presented accordingly. Revenue by geographic area based upon product shipment destination ( in thousands ): Three Months Ended Six Months Ended Net Sales June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 China $ 32,738 $ 19,140 $ 56,289 $ 39,383 United States 19,408 15,662 36,509 30,140 Malaysia 16,993 13,048 34,707 24,857 Taiwan 17,202 2,905 32,172 5,846 Philippines 11,395 9,916 25,936 20,462 Rest of the World 52,275 39,146 112,207 74,279 Total net sales $ 150,011 $ 99,817 $ 297,820 $ 194,967 A small number of customers historically have been responsible for a significant portion of our net sales. Significant customer concentration information, by reportable segment, is as follows: Three Months Ended Six Months Ended June 29, June 30, June 29, June 30, 2019 2018 2019 2018 Semiconductor Test &amp; Inspection (1) Customers individually accounting for more than 10% of net sales one one one one Percentage of net sales 12 % 11 % 12 % 11 % PCB Test Customers individually accounting for more than 10% of net sales * N/A * N/A Percentage of net sales * N/A * N/A * No single customer represented more than 10% of consolidated net sales. ( 1 ) After the acquisition of Xcerra on October 1, 2018 we report in two segments, Semiconductor Test &amp; Inspection and PCB Test. Cohus historical reported net sales would have been reported in our Semiconductor Test &amp; Inspection segment and have been presented accordingly.