Victor -
I got some more insight into why late sales of Tandem systems would add to a quarter's revenue. Apparently, many Tandem sales are to existing customers, on existing systems.
Because these systems are completely modular and can be expanded from a few nodes to hundreds, it is straightforward for a customer who needs more capacity to just order up more hardware. Tandem also provides "service level guarantees" which in effect guarantees that a customer will see the benefits he needs if he buys the additional system capacity.
So Tandem will actually build and install the hardware, then integrate and tune it, prior to the sale. If they achieve the service level, the customer is obligated to buy the additional capacity.
Under this scenario, the revenue would be booked immediately - after all, the systems are already built, and installed and running at the customer's site. |
