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
 9 Months Ended
Sep. 27, 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 September 27, 2020, was $900 million. We expect to recognize the related revenue of $172 million over the next 12 months and $728 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 September 27,
2020		 December 31,
2019
Unbilled revenue $ 79  $ 68 
Deferred revenue, primarily extended warranty 1,377  1,354 
We recognized revenue of $84 million and $290 million for the three and nine months ended September 27, 2020, compared with $79 million and $282 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 nine months ended September 27, 2020 or September 29, 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 Nine months ended
In millions September 27,
2020		 September 29,
2019		 September 27,
2020		 September 29,
2019
United States $ 2,805  $ 3,414  $ 7,522  $ 10,461 
China 705  481  2,037  1,698 
India 166  185  406  643 
Other international 1,442  1,688  4,016  5,191 
Total net sales $ 5,118  $ 5,768  $ 13,981  $ 17,993 
Segment Revenue
Engine segment external sales by market were as follows:
Three months ended Nine months ended
In millions September 27,
2020		 September 29,
2019		 September 27,
2020		 September 29,
2019
Heavy-duty truck $ 486  $ 635  $ 1,226  $ 2,112 
Medium-duty truck and bus 389  525  1,177  1,765 
Light-duty automotive 502  451  975  1,216 
Total on-highway 1,377  1,611  3,378  5,093 
Off-highway 240  211  755  786 
Total sales $ 1,617  $ 1,822  $ 4,133  $ 5,879 
Distribution segment external sales by region were as follows:
Three months ended Nine months ended
In millions September 27,
2020		 September 29,
2019		 September 27,
2020		 September 29,
2019
North America $ 1,126  $ 1,373  $ 3,409  $ 4,139 
Asia Pacific 195  224  577  667 
Europe 153  135  424  380 
China 74  82  242  264 
Africa and Middle East 47  60  136  170 
India 42  46  101  142 
Russia 41  33  126  113 
Latin America 37  48  108  134 
Total sales $ 1,715  $ 2,001  $ 5,123  $ 6,009 
Distribution segment external sales by product line were as follows:
Three months ended Nine months ended
In millions September 27,
2020		 September 29,
2019		 September 27,
2020		 September 29,
2019
Parts $ 719  $ 796  $ 2,155  $ 2,464 
Power generation 415  466  1,166  1,292 
Service 303  376  926  1,109 
Engines 278  363  876  1,144 
Total sales $ 1,715  $ 2,001  $ 5,123  $ 6,009 
Components segment external sales by business were as follows:
Three months ended Nine months ended
In millions September 27,
2020		 September 29,
2019		 September 27,
2020		 September 29,
2019
Emission solutions $ 612  $ 660  $ 1,576  $ 2,144 
Filtration 260  249  715  771 
Turbo technologies 163  151  463  522 
Automated transmissions 90  146  215  451 
Electronics and fuel systems 76  47  223  167 
Total sales $ 1,201  $ 1,253  $ 3,192  $ 4,055 
Power Systems segment external sales by product line were as follows:
Three months ended Nine months ended
In millions September 27,
2020		 September 29,
2019		 September 27,
2020		 September 29,
2019
Power generation $ 334  $ 372  $ 827  $ 1,060 
Industrial 167  227  477  704 
Generator technologies 66  84  191  266 
Total sales $ 567  $ 683  $ 1,495  $ 2,030