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NOTE 10. PRODUCT WARRANTY LIABILITY
A tabular reconciliation of the product warranty liability, including the deferred revenue related to our extended warranty coverage and accrued product campaigns, was as follows:
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Nine months ended |
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September 30, |
| In millions |
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2026 |
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2025 |
| Balance at beginning of year |
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$ |
2,778
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|
|
$ |
2,623 |
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| Provision for base warranties issued |
|
512
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|
468 |
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| Deferred revenue on extended warranty contracts sold |
|
293
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|
|
313 |
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| Provision for product campaigns issued |
|
53
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|
30 |
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| Payments made during period |
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(566) |
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(538) |
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| Amortization of deferred revenue on extended warranty contracts |
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(237) |
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(220) |
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| Changes in estimates for pre-existing product warranties and campaigns |
|
52
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54 |
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| Foreign currency translation adjustments and other |
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—
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(8) |
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| Balance at end of period |
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$ |
2,885
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$ |
2,722 |
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We recognized supplier recoveries of $4 million and $22 million for the three and nine months ended September 30, 2026, compared with zero and $19 million for the comparable periods in 2025.
Warranty related deferred revenues and warranty liabilities on our Condensed Consolidated Balance Sheets were as follows:
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| In millions |
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September 30,
2026 |
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December 31,
2025 |
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Balance Sheet Location |
| Deferred revenue related to extended coverage programs |
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| Current portion |
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$ |
307
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|
|
$ |
303 |
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|
Current portion of deferred revenue |
| Long-term portion |
|
948
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|
|
895 |
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Deferred revenue |
| Total |
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$ |
1,255
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$ |
1,198 |
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| Product warranty |
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| Current portion |
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$ |
664
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|
|
$ |
693 |
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Current portion of accrued product warranty |
| Long-term portion |
|
966
|
|
|
887 |
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Other liabilities |
| Total |
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$ |
1,630
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$ |
1,580 |
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| Total warranty accrual |
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$ |
2,885
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$ |
2,778 |
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