Entropic's statements have been really vague but I don't think they "discounted" anything. They couldn't charge their full labour cost because they had a signed

Entropic's statements have been really vague but I don't think they "discounted" anything. They couldn't charge their full labour cost because they had a signed SOW. So they may have put in more hours than estimated and weren't able to bill their usual hourly rate, but that's why we have SOWs - to protect the clients in the case of overages. If they wanted a time and materials style contract they could have bid that.