Note 10 – Significant Customers

Revenue from continuing operations for the three months ended September 30, 2018 and 2017 was $2.4 million and $3.0 million, respectively. Three third-party contract manufacturing customers accounted for 38.9%, 30.4% and 15.2%, respectively, of our revenue from continuing operations for the three months ended September 30, 2018. Three third-party contract manufacturing customers accounted for 61.1%, 16.5% and 10.6%, respectively, of our revenues from continuing operations for the three months ended September 30, 2017. The loss of sales to any of these large third-party contract manufacturing customers could have a material adverse effect on our business operations and financial condition.

Revenue from continuing operations for the nine months ended September 30, 2018 and 2017 was $9.0 million and $5.7 million, respectively. Two third-party contract manufacturing customers accounted for 39.8% and 39.0%, respectively, of our revenue from continuing operations for the nine months ended September 30, 2018. Two third-party contract manufacturing customers accounted for 50.7% and 21.5%, respectively, of our revenues from continuing operations for the nine months ended September 30, 2017. The loss of sales to either of these large third-party contract manufacturing customers could have a material adverse effect on our business operations and financial condition.

We are subject to account receivable credit concentrations from time-to-time as a consequence of the timing, payment pattern and ultimate purchase volumes or shipping schedules with our customers. These concentrations may impact our overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic, regulatory or other conditions that may impact the timing and collectability of amounts due to us. Two customers represented 59% and 15% of our total trade receivable balances at September 30, 2018 and one customer represented 84% of our total trade receivable balances at December 31, 2017, respectively. Management believes that the provision for possible losses on uncollectible accounts receivable is adequate for our credit loss exposure. The allowance for doubtful accounts was zero for both September 30, 2018 and December 31, 2017.