Revenue Recognition | (a) Disaggregation of revenue Revenues are disaggregated by timing of revenue recognition related to contracts with customers (“ASC 606”) and reconciled to reportable segment revenues as follows (in thousands): Three months ended September 26, 2020 Dunkin' U.S. Baskin-Robbins U.S. Dunkin' International Baskin-Robbins International U.S. Advertising Funds Total reportable segment revenues Other (a) Total revenues Revenues recognized under ASC 606 Revenues recognized over time: Royalty income $ 130,866 9,016 4,744 2,278 — 146,904 5,733 152,637 Franchise fees 6,485 380 335 229 — 7,429 (1) 7,428 Advertising fees and related income — — — — 123,025 123,025 1,223 124,248 Other revenues 627 2,985 104 8 — 3,724 9,775 13,499 Total revenues recognized over time 137,978 12,381 5,183 2,515 123,025 281,082 16,730 297,812 Revenues recognized at a point in time: Sales of ice cream and other products — 1,524 — 27,495 — 29,019 (4,505) 24,514 Other revenues 153 132 5 (23) — 267 279 546 Total revenues recognized at a point in time 153 1,656 5 27,472 — 29,286 (4,226) 25,060 Total revenues recognized under ASC 606 138,131 14,037 5,188 29,987 123,025 310,368 12,504 322,872 Revenues not subject to ASC 606 Advertising fees and related income — — — — — — 8,032 8,032 Rental income 29,822 740 — 77 — 30,639 — 30,639 Total revenues not subject to ASC 606 29,822 740 — 77 — 30,639 8,032 38,671 Total revenues $ 167,953 14,777 5,188 30,064 123,025 341,007 20,536 361,543 (a) Revenues reported as “Other” include revenues earned through certain licensing arrangements, revenues generated from online training programs for franchisees, advertising fees and related income from international advertising funds, and breakage and other revenue related to the gift card program, all of which are not allocated to a specific segment. Additionally, the allocation of royalty income from sales of ice cream and other products, certain franchisee incentives, and certain corporate financial relief provided to franchisees are reported as “Other.” Three months ended September 28, 2019 Dunkin' U.S. Baskin-Robbins U.S. Dunkin' International Baskin-Robbins International U.S. Advertising Funds Total reportable segment revenues Other (a) Total revenues Revenues recognized under ASC 606 Revenues recognized over time: Royalty income $ 130,993 8,973 5,769 2,197 — 147,932 5,288 153,220 Franchise fees 3,675 374 792 165 — 5,006 (1,002) 4,004 Advertising fees and related income — — — — 122,819 122,819 1,412 124,231 Other revenues 624 2,962 120 9 — 3,715 9,196 12,911 Total revenues recognized over time 135,292 12,309 6,681 2,371 122,819 279,472 14,894 294,366 Revenues recognized at a point in time: Sales of ice cream and other products — 1,021 — 28,459 — 29,480 (5,071) 24,409 Other revenues 288 52 68 (37) — 371 308 679 Total revenues recognized at a point in time 288 1,073 68 28,422 — 29,851 (4,763) 25,088 Total revenues recognized under ASC 606 135,580 13,382 6,749 30,793 122,819 309,323 10,131 319,454 Revenues not subject to ASC 606 Advertising fees and related income — — — — — — 4,444 4,444 Rental income 30,824 942 — 218 — 31,984 — 31,984 Total revenues not subject to ASC 606 30,824 942 — 218 — 31,984 4,444 36,428 Total revenues $ 166,404 14,324 6,749 31,011 122,819 341,307 14,575 355,882 (a) Revenues reported as “Other” include revenues earned through certain licensing arrangements, revenues generated from online training programs for franchisees, advertising fees and related income from international advertising funds, and breakage and other revenue related to the gift card program, all of which are not allocated to a specific segment. Additionally, the allocation of royalty income from sales of ice cream and other products and certain franchisee incentives are reported as “Other.” Nine months ended September 26, 2020 Dunkin' U.S. Baskin-Robbins U.S. Dunkin' International Baskin-Robbins International U.S. Advertising Funds Total reportable segment revenues Other (a) Total revenues Revenues recognized under ASC 606 Revenues recognized over time: Royalty income $ 351,740 23,423 12,086 5,662 — 392,911 3,584 396,495 Franchise fees 16,503 980 1,095 534 — 19,112 (101) 19,011 Advertising fees and related income — — — — 331,139 331,139 3,309 334,448 Other revenues 2,002 7,481 192 8 — 9,683 29,593 39,276 Total revenues recognized over time 370,245 31,884 13,373 6,204 331,139 752,845 36,385 789,230 Revenues recognized at a point in time: Sales of ice cream and other products — 3,803 — 77,281 — 81,084 (9,920) 71,164 Other revenues 684 195 91 (42) — 928 720 1,648 Total revenues recognized at a point in time 684 3,998 91 77,239 — 82,012 (9,200) 72,812 Total revenues recognized under ASC 606 370,929 35,882 13,464 83,443 331,139 834,857 27,185 862,042 Revenues not subject to ASC 606 Advertising fees and related income — — — — — — 24,433 24,433 Rental income 82,962 2,146 — 480 — 85,588 — 85,588 Total revenues not subject to ASC 606 82,962 2,146 — 480 — 85,588 24,433 110,021 Total revenues $ 453,891 38,028 13,464 83,923 331,139 920,445 51,618 972,063 (a) Revenues reported as “Other” include revenues earned through certain licensing arrangements, revenues generated from online training programs for franchisees, advertising fees and related income from international advertising funds, and breakage and other revenue related to the gift card program, all of which are not allocated to a specific segment. Additionally, the allocation of royalty income from sales of ice cream and other products, certain franchisee incentives, and certain corporate financial relief provided to franchisees are reported as “Other.” Nine months ended September 28, 2019 Dunkin' U.S. Baskin-Robbins U.S. Dunkin' International Baskin-Robbins International U.S. Advertising Funds Total reportable segment revenues Other (a) Total revenues Revenues recognized under ASC 606 Revenues recognized over time: Royalty income $ 379,772 23,904 17,078 6,055 — 426,809 12,524 439,333 Franchise fees 10,719 1,030 3,687 1,043 — 16,479 (1,002) 15,477 Advertising fees and related income — — — — 355,049 355,049 3,984 359,033 Other revenues 1,918 8,125 124 9 — 10,176 26,813 36,989 Total revenues recognized over time 392,409 33,059 20,889 7,107 355,049 808,513 42,319 850,832 Revenues recognized at a point in time: Sales of ice cream and other products — 2,772 — 81,531 — 84,303 (11,903) 72,400 Other revenues 1,154 183 181 (24) — 1,494 794 2,288 Total revenues recognized at a point in time 1,154 2,955 181 81,507 — 85,797 (11,109) 74,688 Total revenues recognized under ASC 606 393,563 36,014 21,070 88,614 355,049 894,310 31,210 925,520 Revenues not subject to ASC 606 Advertising fees and related income — — — — — — 16,099 16,099 Rental income 89,163 2,875 — 653 — 92,691 — 92,691 Total revenues not subject to ASC 606 89,163 2,875 — 653 — 92,691 16,099 108,790 Total revenues $ 482,726 38,889 21,070 89,267 355,049 987,001 47,309 1,034,310 (a) Revenues reported as “Other” include revenues earned through certain licensing arrangements, revenues generated from online training programs for franchisees, advertising fees and related income from international advertising funds, and breakage and other revenue related to the gift card program, all of which are not allocated to a specific segment. Additionally, the allocation of royalty income from sales of ice cream and other products and certain franchisee incentives are reported as “Other.” (b) Contract balances Information about receivables, contract assets, and deferred revenue subject to ASC 606 is as follows (in thousands): September 26, December 28, Balance Sheet Classification Receivables $ 113,401 86,104 Accounts receivable, net, Notes and other receivables, net, and Other assets Contract assets 7,235 4,894 Other assets Deferred revenue: Current $ 26,138 27,213 Deferred revenue—current Long-term 284,023 320,457 Deferred revenue—long term Total $ 310,161 347,670 Receivables relate primarily to payments due for royalties, franchise fees, advertising fees, sales of ice cream and other products, and licensing fees. Contract assets relate primarily to consideration paid to customers, including franchisee incentives, that exceeds the fixed consideration received for certain contracts, net of any revenue recognized. Deferred revenue primarily represents the Company’s remaining performance obligations under its franchise and license agreements for which consideration has been received or is receivable, and is generally recognized on a straight-line basis over the remaining term of the related agreement. The decrease in the deferred revenue balance as of September 26, 2020 was driven primarily by $27.1 million of revenues recognized that were included in the opening deferred revenue balance as of December 28, 2019, as well as franchisee incentives provided during fiscal year 2020, offset by cash payments received or due in advance of satisfying our performance obligations. (c) Transaction price allocated to remaining performance obligations Estimated revenue expected to be recognized in the future related to performance obligations that are either unsatisfied or partially satisfied at September 26, 2020 is as follows (in thousands): Fiscal year: 2020 (a) $ 7,169 2021 20,499 2022 16,662 2023 16,870 2024 17,231 Thereafter 195,981 Total $ 274,412 (a) Represents the estimate for remainder of fiscal year 2020 which excludes the nine months ended September 26, 2020. |