Quarterly report pursuant to Section 13 or 15(d)

OPERATING SEGMENTS (Tables)

v3.22.1
OPERATING SEGMENTS (Tables)
 3 Months Ended
Mar. 31, 2022
Segment Reporting [Abstract]  
Financial information regarding reportable operating segments
Summarized financial information regarding our reportable operating segments for the three months ended is shown in the table below:
In millions Engine Distribution Components Power Systems New Power Total Segments
Three months ended March 31, 2022    
External sales $ 2,049  $ 2,111  $ 1,517  $ 683  $ 25  $ 6,385 
Intersegment sales 704  6  471  477  6  1,664 
Total sales 2,753  2,117  1,988  1,160  31  8,049 
Research, development and engineering expenses 109  13  76  64  36  298 
Equity, royalty and interest income (loss) from investees 44  (1) 16  28  11  (3) 96 
Interest income 4  2  1  1  —  8 
Russian suspension costs(2)
32  (3) 100  6  20  —  158 
Segment EBITDA 392  110  320  90  (67) 845 
Depreciation and amortization(4)
51  28  43  31  7  160 
Three months ended April 4, 2021        
External sales $ 1,895  $ 1,827  $ 1,724  $ 612  $ 34  $ 6,092 
Intersegment sales 564  8  428  410  1  1,411 
Total sales 2,459  1,835  2,152  1,022  35  7,503 
Research, development and engineering expenses 92  13  75  57  23  260 
Equity, royalty and interest income from investees 113  17  19  12  5  166 
Interest income 3  1  1  1  —  6 
Segment EBITDA 354  160  421  126  (51) 1,010 
Depreciation and amortization(4)
51  30  48  35  5  169 
(1) Includes a $28 million impairment of our joint venture with KAMAZ and $3 million of royalty charges as part of our costs associated with the suspension of our Russian operations. See Note 3, "RUSSIAN OPERATIONS" to our Condensed Consolidated Financial Statements for additional information.
(2) See Note 3, "RUSSIAN OPERATIONS" to our Condensed Consolidated Financial Statements for additional information.
(3) Includes $31 million of Russian suspension costs reflected in the Equity, royalty and interest income (loss) from investees line above.
(4) Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Net Income as Interest expense. The amortization of debt discount and deferred costs was $1 million and $1 million for the three months ended March 31, 2022 and April 4, 2021, respectively. A portion of depreciation expense is included in Research, development and engineering expenses.
Reconciliation of Revenue from Segments to Consolidated
A reconciliation of our total segment sales to total net sales in the Condensed Consolidated Statements of Net Income was as follows:
  Three months ended
In millions March 31,
2022		 April 4,
2021
Total segment sales $ 8,049  $ 7,503 
Elimination of intersegment sales (1,664) (1,411)
Total net sales $ 6,385  $ 6,092 
Reconciliation of segment information
A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidated Statements of Net Income is shown in the table below:
  Three months ended
In millions March 31,
2022		 April 4,
2021
TOTAL SEGMENT EBITDA $ 845  $ 1,010 
Intersegment eliminations and other (1)
(90) (30)
Less:
Interest expense 17  28 
Depreciation and amortization 160  169 
INCOME BEFORE INCOME TAXES 578  783 
Less: Income tax expense 155  172 
CONSOLIDATED NET INCOME 423  611 
Less: Net income attributable to noncontrolling interests 5  8 
NET INCOME ATTRIBUTABLE TO CUMMINS INC. $ 418  $ 603 
(1)Intersegment eliminations and other for the three months ended March 31, 2022, included $17 million of costs associated with the planned separation of our Filtration business.