Quarterly report pursuant to Section 13 or 15(d)

OPERATING SEGMENTS (Tables)

v3.24.2.u1
OPERATING SEGMENTS (Tables)
 6 Months Ended
Jun. 30, 2024
Segment Reporting [Abstract]  
Financial information regarding reportable operating segments
Summarized financial information regarding our reportable operating segments for the three and six months ended June 30, 2024 and 2023 is shown in the table below:
In millions Components Engine Distribution Power Systems Accelera Total Segments
Three months ended June 30, 2024    
External sales $ 2,518  $ 2,468  $ 2,821  $ 888  $ 101  $ 8,796 
Intersegment sales 464  683  8  701  10  1,866 
Total sales 2,982  3,151  2,829  1,589  111  10,662 
Research, development and engineering expenses 81  167  14  63  54  379 
Equity, royalty and interest income (loss) from investees 13  48  24  26  (8) 103 
Interest income 9  7  11  3  —  30 
Segment EBITDA 406  445  314  301  (117) 1,349 
Depreciation and amortization (1)
121  61  30  32  15  259 
Three months ended June 30, 2023      
External sales $ 2,924  $ 2,263  $ 2,576  $ 794  $ 81  $ 8,638 
Intersegment sales 501  725  19  663  4  1,912 
Total sales 3,425  2,988  2,595  1,457  85  10,550 
Research, development and engineering expenses 103  148  15  66  52  384 
Equity, royalty and interest income (loss) from investees 24  71  24  18  (4) 133 
Interest income 7  7  8  2  1  25 
Segment EBITDA 486 
(2)
 425  299  201  (114) 1,297 
Depreciation and amortization (1)
125  56  28  32  15  256 
Six months ended June 30, 2024
External sales $ 5,360  $ 4,708  $ 5,350  $ 1,596  $ 185  $ 17,199 
Intersegment sales 954  1,371  14  1,382  19  3,740 
Total sales 6,314  6,079  5,364  2,978  204  20,939 
Research, development and engineering expenses 165  321  28  123  109  746 
Equity, royalty and interest income (loss) from investees 39  105  48  45  (11) 226 
Interest income 17  14  22  6  —  59 
Segment EBITDA 879 
(2)
 859  608  538  (218) 2,666 
Depreciation and amortization (1)
246  119  61  66  29  521 
Six months ended June 30, 2023
External sales $ 5,967  $ 4,515  $ 4,975  $ 1,473  $ 161  $ 17,091 
Intersegment sales 1,015  1,459  26  1,327  9  3,836 
Total sales 6,982  5,974  5,001  2,800  170  20,927 
Research, development and engineering expenses 194  282  29  129  100  734 
Equity, royalty and interest income (loss) from investees 45  136  48  31  (8) 252 
Interest income 13  10  15  4  1  43 
Segment EBITDA 993 
(2)
 882  634  420  (208) 2,721 
Depreciation and amortization (1)
248  107  56  61  29  501 
(1) 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 $7 million and $2 million for the six months ended June 30, 2024 and June 30, 2023, respectively. A portion of depreciation expense is included in research, development and engineering expenses.
(2) Included $21 million of costs associated with the divestiture of Atmus for the six months ended June 30, 2024. Included $18 million and $30 million of costs associated with the divestiture of Atmus for the three and six months ended June 30, 2023. See NOTE 14, "ATMUS INITIAL PUBLIC OFFERING (IPO) AND DIVESTITURE," for additional information.
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 Six months ended
  June 30, June 30,
In millions 2024 2023 2024 2023
TOTAL SEGMENT EBITDA $ 1,349  $ 1,297  $ 2,666  $ 2,721 
Intersegment eliminations and other (1)
(4) 7 
(2)
 1,251 
(3)
 (56)
(2)
Less:
Interest expense 109  99  198  186 
Depreciation and amortization 259  256  521  501 
INCOME BEFORE INCOME TAXES $ 977  $ 949  $ 3,198  $ 1,978 
(1) Included intersegment sales, intersegment profit in inventory and unallocated corporate expenses.
(2) Included $5 million and $11 million of costs associated with the divestiture of Atmus for the three and six months ended June 30, 2023.
(3) Included $1.3 billion of gain related the divestiture of Atmus and $14 million of costs associated with the divestiture of Atmus (included in corporate expenses) for the six months ended June 30, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.