Quarterly report pursuant to Section 13 or 15(d)

REVENUE RECOGNITION LONG-TERM CONTRACTS AND DEFERRED AND UNBILLED REVENUE

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REVENUE RECOGNITION LONG-TERM CONTRACTS AND DEFERRED AND UNBILLED REVENUE
 6 Months Ended
Jun. 28, 2020
Revenue from Contract with Customer [Abstract]  
Revenue from Contract with Customer
NOTE 3. REVENUE RECOGNITION
Long-term Contracts
Most of our contracts are for a period of less than one year. We have certain long-term maintenance agreements, construction contracts and extended warranty coverage arrangements that span a period in excess of one year. The aggregate amount of the transaction price for long-term maintenance agreements and construction contracts allocated to performance obligations that had not been satisfied as of June 28, 2020, was $939 million. We expect to recognize the related revenue of $231 million over the next 12 months and $708 million over periods up to 10 years. See Note 10, "PRODUCT WARRANTY LIABILITY," for additional disclosures on extended warranty coverage arrangements. Our other contracts generally are for a duration of less than one year, include payment terms that correspond to the timing of costs incurred when providing goods and services to our customers or represent sales-based royalties.
Deferred and Unbilled Revenue
The following is a summary of our unbilled and deferred revenue and related activity:
In millions June 28,
2020		 December 31,
2019
Unbilled revenue $ 76    $ 68   
Deferred revenue, primarily extended warranty 1,352    1,354   
We recognized revenue of $94 million and $206 million for the three and six months ended June 28, 2020, compared with $94 million and $203 million for the comparable periods in 2019, that was included in the deferred revenue balance at the beginning of each year. We did not record any impairment losses on our unbilled revenues during the three and six months ended June 28, 2020 or June 30, 2019.
Disaggregation of Revenue
Consolidated Revenue
The table below presents our consolidated sales by geographic area. Net sales attributed to geographic areas were based on the location of the customer.
  Three months ended Six months ended
In millions June 28,
2020		 June 30,
2019		 June 28,
2020		 June 30,
2019
United States $ 1,865    $ 3,611    $ 4,717    $ 7,047   
China 810    644    1,332    1,217   
India 70    234    240    458   
Other international 1,107    1,732    2,574    3,503   
Total net sales $ 3,852    $ 6,221    $ 8,863    $ 12,225   
Segment Revenue
Engine segment external sales by market were as follows:
Three months ended Six months ended
In millions June 28,
2020		 June 30,
2019		 June 28,
2020		 June 30,
2019
Heavy-duty truck $ 221    $ 754    $ 740    $ 1,477   
Medium-duty truck and bus 298    630    788    1,240   
Light-duty automotive 146    435    473    765   
Total on-highway 665    1,819    2,001    3,482   
Off-highway 272    254    515    575   
Total sales $ 937    $ 2,073    $ 2,516    $ 4,057   
Distribution segment external sales by region were as follows:
Three months ended Six months ended
In millions June 28,
2020		 June 30,
2019		 June 28,
2020		 June 30,
2019
North America $ 1,038    $ 1,374    $ 2,283    $ 2,766   
Asia Pacific 190    223    382    443   
Europe 136    122    271    245   
China 100    101    168    182   
Russia 44    45    85    80   
Africa and Middle East 38    55    89    110   
Latin America 32    46    71    86   
India 23    49    59    96   
Total sales $ 1,601    $ 2,015    $ 3,408    $ 4,008   
Distribution segment external sales by product line were as follows:
Three months ended Six months ended
In millions June 28,
2020		 June 30,
2019		 June 28,
2020		 June 30,
2019
Parts $ 653    $ 827    $ 1,436    $ 1,668   
Power generation 376    425    751    826   
Service 296    371    623    733   
Engines 276    392    598    781   
Total sales $ 1,601    $ 2,015    $ 3,408    $ 4,008   
Components segment external sales by business were as follows:
Three months ended Six months ended
In millions June 28,
2020		 June 30,
2019		 June 28,
2020		 June 30,
2019
Emission solutions $ 394    $ 735    $ 964    $ 1,484   
Filtration 206    263    455    522   
Turbo technologies 142    181    300    371   
Electronics and fuel systems 91    66    147    120   
Automated transmissions 43    156    125    305   
Total sales $ 876    $ 1,401    $ 1,991    $ 2,802   
Power Systems segment external sales by product line were as follows:
Three months ended Six months ended
In millions June 28,
2020		 June 30,
2019		 June 28,
2020		 June 30,
2019
Power generation $ 224    $ 380    $ 493    $ 688   
Industrial 145    246    310    477   
Generator technologies 59    98    125    182   
Total sales $ 428    $ 724    $ 928    $ 1,347