Quarterly report [Sections 13 or 15(d)]

REPORTABLE SEGMENTS (Tables)

v3.26.3
REPORTABLE SEGMENTS (Tables)
 9 Months Ended
Sep. 30, 2026
Segment Reporting [Abstract]  
Schedule of Financial Information Regarding Reportable Operating Segments
Summarized financial information regarding our reportable segments for the three and nine months ended September 30, 2026 and 2025 is shown in the table below:
In millions Engine Components Distribution Power Systems Accelera Total Segments
Three months ended September 30, 2026
External sales $ 2,389  $ 2,397  $ 3,307  $ 1,250  $ 95  $ 9,438 
Intersegment sales 741  459  3  1,039  8  2,250 
Total sales 3,130  2,856  3,310  2,289  103  11,688 
Cost of goods sold (excluding warranty expenses) 2,338  2,250  2,633  1,521  109  8,851 
Warranty expenses 98  57  11  29  12  207 
Selling expenses 69  46  168  50  6  339 
Administrative expenses 173  136  109  102  9  529 
Research, development and engineering expenses 186  85  16  85  28  400 
Equity, royalty and interest income (loss) from investees 58  9  29  35  (4) 127 
Other income (expense) (1)
19  (8) 22  9  1  43 
Add back: Depreciation and amortization (2)
79  125  37  36  8  285 
Segment EBITDA $ 422  $ 408  $ 461  $ 582  $ (56) $ 1,817 
Interest income (3)
$ 12  $ 11  $ 7  $ 6  $ 1  $ 37 
Three months ended September 30, 2025
External sales $ 1,922  $ 1,986  $ 3,170  $ 1,126  $ 113  $ 8,317 
Intersegment sales 683  343  2  870  8  1,906 
Total sales 2,605  2,329  3,172  1,996  121  10,223 
Cost of goods sold (excluding warranty expenses) 2,030  1,868  2,489  1,357  172 
(4)
 7,916 
Warranty expenses 97  29  5  37  18  186 
Selling expenses 57  43  151  42  7  300 
Administrative expenses 141  132  93  105  18  489 
Research, development and engineering expenses 159  70  14  62  40  345 
Equity, royalty and interest income (loss) from investees 54  7  23  26  (6) 104 
Other income (expense) (1)
15  (24) 17  2  (209)
(4)
 (199)
Add back: Depreciation and amortization (2)
71  122  32  36  13  274 
Segment EBITDA $ 261  $ 292  $ 492  $ 457  $ (336)
(4)
 $ 1,166 
Interest income (3)
$ 11  $ 8  $ 6  $ 4  $ —  $ 29 
In millions Engine Components Distribution Power Systems Accelera Total Segments
Nine months ended September 30, 2026
External sales $ 6,704  $ 6,966  $ 9,736  $ 3,560  $ 327  $ 27,293 
Intersegment sales 2,182  1,311  16  2,940  22  6,471 
Total sales 8,886  8,277  9,752  6,500  349  33,764 
Cost of goods sold (excluding warranty expenses) 6,749  6,574  7,729  4,265  381  25,698 
Warranty expenses 291  146  32  71  55  595 
Selling expenses 207  145  507  148  17  1,024 
Administrative expenses 508  411  323  309  31  1,582 
Research, development and engineering expenses 531  254  46  230  82  1,143 
Equity, royalty and interest income (loss) from investees 217  29  91  105  (13) 429 
Other income (expense) (1)
42  (29) 44  22  (197)
(5)
 (118)
Add back: Depreciation and amortization (2)
228  379  106  107  25  845 
Segment EBITDA $ 1,087  $ 1,126  $ 1,356  $ 1,711  $ (402)
(5)
 $ 4,878 
Interest income (3)
$ 32  $ 33  $ 20  $ 16  $ 1  $ 102 
Nine months ended September 30, 2025
External sales $ 6,124  $ 6,551  $ 9,106  $ 3,052  $ 301  $ 25,134 
Intersegment sales 2,151  1,153  14  2,482  28  5,828 
Total sales 8,275  7,704  9,120  5,534  329  30,962 
Cost of goods sold (excluding warranty expenses) 6,234  6,168  7,240  3,737  425 
(4)
 23,804 
Warranty expenses 301  83  16  95  38  533 
Selling expenses 177  124  462  129  21  913 
Administrative expenses 425  372  273  311  45  1,426 
Research, development and engineering expenses 465  222  42  188  129  1,046 
Equity, royalty and interest income (loss) from investees 187  24  77  82  (17) 353 
Other income (expense) (1)
53  (59) 53  16  (214)
(4)
 (151)
Add back: Depreciation and amortization (2)
206  371  96  104  38  815 
Segment EBITDA $ 1,119  $ 1,071  $ 1,313  $ 1,276  $ (522)
(4)
 $ 4,257 
Interest income (3)
$ 29  $ 25  $ 18  $ 12  $ 1  $ 85 
(1) Other income (expense) includes other operating expense, net and other income, net (excluding unallocated corporate expenses) from our Condensed Consolidated Statements of Net Income.
(2) Depreciation and amortization are not considered significant segment expenses but are presented here to reconcile to EBITDA, the measure used by our CODM. Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in our Condensed Consolidated Statements of Net Income as interest expense. A portion of depreciation expense is included in research, development and engineering expenses.
(3) Interest income is a component of other income (expense).
(4) Included a $30 million inventory write-down in cost of goods sold and a $210 million goodwill impairment charge in other income (expense). See NOTE 14, “ACCELERA ACTIONS,” for additional information.
(5) Included a $199 million net charge in other income (expense) related to the sale of our low pressure fuel cell business and settlement of current and future customer obligations. See NOTE 14, “ACCELERA ACTIONS,” for additional information.
Schedule of 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 Nine months ended
September 30, September 30,
In millions 2026 2025 2026 2025
TOTAL SEGMENT EBITDA $ 1,817  $ 1,166  $ 4,878  $ 4,257 
Intersegment eliminations and other (1)
(31) 21  (149) (23)
Less:
Interest expense 81  83  237  247 
Depreciation and amortization 285  274  845  815 
INCOME BEFORE INCOME TAXES $ 1,420  $ 830  $ 3,647  $ 3,172 
(1) Included intersegment sales, intersegment profit in inventory and unallocated corporate expenses.