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
 3 Months Ended
Mar. 31, 2023
Revenue from Contract with Customer [Abstract]  
Revenue from Contract with Customer
NOTE 2. REVENUE FROM CONTRACTS WITH CUSTOMERS
Long-term Contracts
The majority 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 were not satisfied as of March 31, 2023, was $649 million. We expect to recognize the related revenue of $126 million over the next 12 months and $523 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 March 31,
2023		 December 31,
2022
Unbilled revenue $ 332  $ 257 
Deferred revenue 1,977  1,848 
We recognized revenue of $206 million for the three months ended March 31, 2023, compared with $240 million for the comparable period in 2022, 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 months ended March 31, 2023 or March 31, 2022.
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
  March 31,
In millions 2023 2022
United States $ 4,802  $ 3,457 
China 790  653 
India 411  309 
Other international 2,450  1,966 
Total net sales $ 8,453  $ 6,385 
Segment Revenue
As previously announced, our Components segment reorganized its reporting structure to carve out the electronics business into the newly formed software and electronics business and combined the turbo technologies and fuels systems businesses into the newly formed engine components business. We started reporting results for the reorganized business in the first quarter of 2023 and reflected these changes for prior periods.
Components segment external sales by business were as follows:
Three months ended
March 31,
In millions 2023 2022
Axles and brakes $ 1,272  $ — 
Emission solutions 939  808 
Filtration 342  308 
Engine components 292  240 
Automated transmissions 178  134 
Software and electronics 20  27 
Total sales $ 3,043  $ 1,517 
Engine segment external sales by market were as follows:
Three months ended
March 31,
In millions 2023 2022
Heavy-duty truck $ 860  $ 684 
Medium-duty truck and bus 617  591 
Light-duty automotive 441  487 
Total on-highway 1,918  1,762 
Off-highway 334  287 
Total sales $ 2,252  $ 2,049 
As previously announced, due to the indefinite suspension of operations in Russia, we reorganized the regional management structure of our Distribution segment and moved all Commonwealth of Independent States (CIS) sales into the Europe and Africa and Middle East regions. The Russian portion of prior period CIS sales moved to the Europe region. We started to report results for our new regional management structure in the first quarter of 2023 and reflected these changes for historical periods.
Distribution segment external sales by region were as follows:
Three months ended
March 31,
In millions 2023 2022
North America $ 1,693  $ 1,371 
Asia Pacific 239  244 
Europe 194  275 
China 101  82 
Africa and Middle East 62  50 
India 57  48 
Latin America 53  41 
Total sales $ 2,399  $ 2,111 
Distribution segment external sales by product line were as follows:
Three months ended
March 31,
In millions 2023 2022
Parts $ 1,052  $ 926 
Power generation 491  398 
Engines 456  438 
Service 400  349 
Total sales $ 2,399  $ 2,111 
Power Systems segment external sales by product line were as follows:
Three months ended
March 31,
In millions 2023 2022
Power generation $ 380  $ 399 
Industrial 189  188 
Generator technologies 110  96 
Total sales $ 679  $ 683