Quarterly report pursuant to Section 13 or 15(d)

REVENUE RECOGNITION DISAGGREGATION OF REVENUES

v3.19.2
REVENUE RECOGNITION DISAGGREGATION OF REVENUES
6 Months Ended
Jun. 30, 2019
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 have not been satisfied as of June 30, 2019, was $703 million. We expect to recognize the related revenue of $147 million over the next 12 months and $556 million over periods up to 10 years. See NOTE 11, "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 cost incurred when providing goods and services to our customers or represent sale-based royalties.

Deferred and Unbilled Revenue
The following is a summary of our unbilled and deferred revenue and related activity:
In millions
 
June 30,
2019
 
December 31,
2018
Unbilled revenue
 
$
65

 
$
64

Deferred revenue, primarily extended warranty
 
1,231

 
1,156

 
We recognized revenue of $94 million and $203 million and $78 million and $206 million for the three and six months ended June 30, 2019 and July 1, 2018, respectively, 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 six months ended June 30, 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
 
Six months ended
In millions
 
June 30,
2019
 
July 1,
2018
 
June 30,
2019
 
July 1,
2018
United States
 
$
3,611

 
$
3,384

 
$
7,047

 
$
6,422

China
 
644

 
644

 
1,217

 
1,194

India
 
234

 
247

 
458

 
482

Other international
 
1,732

 
1,857

 
3,503

 
3,604

Total net sales
 
$
6,221

 
$
6,132

 
$
12,225

 
$
11,702


Segment Revenue
Engine segment external sales by market were as follows:
 
 
Three months ended
 
Six months ended
In millions
 
June 30,
2019
 
July 1,
2018
 
June 30,
2019
 
July 1,
2018
Heavy-duty truck
 
$
754

 
$
730

 
$
1,477

 
$
1,344

Medium-duty truck and bus
 
630

 
714

 
1,240

 
1,341

Light-duty automotive
 
435

 
330

 
765

 
653

Total on-highway
 
1,819

 
1,774

 
3,482

 
3,338

Off-highway
 
254

 
276

 
575

 
525

Total sales
 
$
2,073

 
$
2,050

 
$
4,057

 
$
3,863


Distribution segment external sales by region were as follows:
 
 
Three months ended
 
Six months ended
In millions
 
June 30,
2019
 
July 1,
2018
 
June 30,
2019
 
July 1,
2018
North America
 
$
1,374

 
$
1,349

 
$
2,766

 
$
2,623

Asia Pacific
 
223

 
211

 
443

 
398

Europe
 
122

 
143

 
245

 
274

China
 
101

 
84

 
182

 
161

Africa and Middle East
 
55

 
62

 
110

 
123

India
 
49

 
49

 
96

 
93

Latin America
 
46

 
45

 
86

 
83

Russia
 
45

 
45

 
80

 
80

Total sales
 
$
2,015

 
$
1,988

 
$
4,008

 
$
3,835


Distribution segment external sales by product line were as follows:
 
 
Three months ended
 
Six months ended
In millions
 
June 30,
2019
 
July 1,
2018
 
June 30,
2019
 
July 1,
2018
Parts
 
$
827

 
$
815

 
$
1,668

 
$
1,618

Power generation
 
425

 
345

 
826

 
670

Engines
 
392

 
460

 
781

 
828

Service
 
371

 
368

 
733

 
719

Total sales
 
$
2,015

 
$
1,988

 
$
4,008

 
$
3,835


Components segment external sales by business were as follows:
 
 
Three months ended
 
Six months ended
In millions
 
June 30,
2019
 
July 1,
2018
 
June 30,
2019
 
July 1,
2018
Emission solutions
 
$
735

 
$
735

 
$
1,484

 
$
1,419

Filtration
 
263

 
257

 
522

 
514

Turbo technologies
 
181

 
201

 
371

 
398

Automated transmissions
 
156

 
141

 
305

 
258

Electronics and fuel systems
 
66

 
68

 
120

 
126

Total sales
 
$
1,401

 
$
1,402

 
$
2,802

 
$
2,715


Power Systems segment external sales by product line were as follows:
 
 
Three months ended
 
Six months ended
In millions
 
June 30,
2019
 
July 1,
2018
 
June 30,
2019
 
July 1,
2018
Power generation
 
$
380

 
$
390

 
$
688

 
$
700

Industrial
 
246

 
208

 
477

 
409

Generator technologies
 
98

 
93

 
182

 
177

Total sales
 
$
724

 
$
691

 
$
1,347

 
$
1,286