Cover Page
Cover Page shares in Millions | 6 Months Ended |
Jun. 30, 2023 shares | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2023 |
Entity File Number | 000-54863 |
Entity Registrant Name | EATON CORPORATION plc |
Entity Incorporation, State or Country Code | L2 |
Entity Tax Identification Number | 98-1059235 |
Entity Address, Address Line One | Eaton House, |
Entity Address, Address Line Two | 30 Pembroke Road, |
Entity Address, City or Town | Dublin 4, |
Entity Address, Country | IE |
Entity Address, Postal Zip Code | D04 Y0C2 |
City Area Code | +353 |
Local Phone Number | 1637 2900 |
Title of 12(b) Security | Ordinary shares ($0.01 par value) |
Trading Symbol | ETN |
Security Exchange Name | NYSE |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 399 |
Entity Central Index Key | 0001551182 |
Amendment Flag | false |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | Q2 |
Current Fiscal Year End Date | --12-31 |
Document Quarterly Report | true |
Document Transition Report | false |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Statement [Abstract] | ||||
Net sales | $ 5,866 | $ 5,212 | $ 11,349 | $ 10,054 |
Cost of products sold | 3,747 | 3,505 | 7,346 | 6,774 |
Selling and administrative expense | 986 | 828 | 1,890 | 1,618 |
Research and development expense | 187 | 168 | 366 | 333 |
Interest expense - net | 42 | 31 | 91 | 63 |
Gain on sale of business | 0 | 0 | 0 | 24 |
Other expense (income) - net | 7 | (41) | (4) | (50) |
Income before income taxes | 898 | 720 | 1,660 | 1,339 |
Income tax expense | 153 | 119 | 276 | 205 |
Net income | 745 | 601 | 1,384 | 1,135 |
Less net income for noncontrolling interests | (1) | 0 | (3) | (1) |
Net income attributable to Eaton ordinary shareholders | $ 744 | $ 601 | $ 1,382 | $ 1,133 |
Net income per share attributable to Eaton ordinary shareholders | ||||
Diluted (USD per share) | $ 1.86 | $ 1.50 | $ 3.45 | $ 2.82 |
Basic (USD per share) | $ 1.86 | $ 1.51 | $ 3.47 | $ 2.84 |
Weighted-average number of ordinary shares outstanding | ||||
Diluted (shares) | 400.7 | 400.7 | 400.6 | 401.2 |
Basic (shares) | 398.9 | 399 | 398.7 | 399.1 |
Cash dividends declared per ordinary share (USD per share) | $ 0.86 | $ 0.81 | $ 1.72 | $ 1.62 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 745 | $ 601 | $ 1,384 | $ 1,135 |
Less net income for noncontrolling interests | (1) | 0 | (3) | (1) |
Net income attributable to Eaton ordinary shareholders | 744 | 601 | 1,382 | 1,133 |
Other comprehensive income (loss), net of tax | ||||
Currency translation and related hedging instruments | 57 | (470) | 176 | (533) |
Pensions and other postretirement benefits | (2) | (41) | (5) | 36 |
Cash flow hedges | (1) | 68 | 14 | 169 |
Other comprehensive income (loss) attributable to Eaton ordinary shareholders | 53 | (444) | 185 | (328) |
Total comprehensive income attributable to Eaton ordinary shareholders | $ 797 | $ 157 | $ 1,567 | $ 805 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash | $ 353 | $ 294 |
Short-term investments | 977 | 261 |
Accounts receivable - net | 4,399 | 4,076 |
Inventory | 3,670 | 3,430 |
Prepaid expenses and other current assets | 904 | 685 |
Total current assets | 10,303 | 8,746 |
Property, plant and equipment | ||
Land and buildings | 2,198 | 2,129 |
Machinery and equipment | 6,139 | 5,885 |
Gross property, plant and equipment | 8,337 | 8,013 |
Accumulated depreciation | (5,071) | (4,867) |
Net property, plant and equipment | 3,267 | 3,146 |
Other noncurrent assets | ||
Goodwill | 14,914 | 14,796 |
Other intangible assets | 5,285 | 5,485 |
Operating lease assets | 594 | 570 |
Deferred income taxes | 354 | 330 |
Other assets | 2,056 | 1,940 |
Total assets | 36,772 | 35,014 |
Current liabilities | ||
Short-term debt | 94 | 324 |
Current portion of long-term debt | 402 | 10 |
Accounts payable | 3,192 | 3,072 |
Accrued compensation | 465 | 467 |
Other current liabilities | 2,571 | 2,488 |
Total current liabilities | 6,725 | 6,360 |
Noncurrent liabilities | ||
Long-term debt | 8,804 | 8,321 |
Pension liabilities | 642 | 649 |
Other postretirement benefits liabilities | 173 | 177 |
Operating lease liabilities | 482 | 459 |
Deferred income taxes | 531 | 530 |
Other noncurrent liabilities | 1,428 | 1,444 |
Total noncurrent liabilities | 12,060 | 11,580 |
Shareholders’ equity | ||
Ordinary shares (399.0 million outstanding in 2023 and 397.8 million in 2022) | 4 | 4 |
Capital in excess of par value | 12,554 | 12,512 |
Retained earnings | 9,156 | 8,468 |
Accumulated other comprehensive loss | (3,760) | (3,946) |
Shares held in trust | (1) | (1) |
Total Eaton shareholders’ equity | 17,953 | 17,038 |
Noncontrolling interests | 36 | 38 |
Total equity | 17,988 | 17,075 |
Total liabilities and equity | $ 36,772 | $ 35,014 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares shares in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Ordinary shares outstanding (shares) | 399 | 397.8 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Operating activities | ||
Net income | $ 1,384 | $ 1,135 |
Adjustments to reconcile to net cash provided by operating activities | ||
Depreciation and amortization | 466 | 479 |
Deferred income taxes | (3) | (14) |
Pension and other postretirement benefits expense | 9 | 21 |
Contributions to pension plans | (51) | (55) |
Contributions to other postretirement benefits plans | (10) | (12) |
Gain on sale of business | 0 | (24) |
Changes in working capital | (622) | (1,144) |
Other - net | 12 | (5) |
Net cash provided by operating activities | 1,185 | 382 |
Investing activities | ||
Capital expenditures for property, plant and equipment | (286) | (254) |
Proceeds from sales of property, plant and equipment | 0 | 92 |
Cash paid for acquisition of a business, net of cash acquired | 0 | (612) |
Proceeds from (payments for) sale of business, net of cash sold | (1) | 22 |
Investments in associate companies | (68) | (17) |
Purchases of short-term investments - net | (719) | (4) |
Proceeds from (payments for) settlement of currency exchange contracts not designated as hedges - net | 42 | (9) |
Other - net | 2 | (41) |
Net cash used in investing activities | (1,030) | (822) |
Financing activities | ||
Proceeds from borrowings | 818 | 0 |
Payments on borrowings | (5) | (6) |
Short-term debt, net | (225) | 1,384 |
Cash dividends paid | (692) | (654) |
Exercise of employee stock options | 46 | 13 |
Repurchase of shares | 0 | (186) |
Employee taxes paid from shares withheld | (47) | (58) |
Other - net | (7) | (1) |
Net cash provided by (used in) financing activities | (113) | 492 |
Effect of currency on cash | 16 | 15 |
Total increase in cash | 59 | 66 |
Cash at the beginning of the period | 294 | 297 |
Cash at the end of the period | $ 353 | $ 364 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements of Eaton Corporation plc (Eaton or the Company) have been prepared in accordance with generally accepted accounting principles for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles (US GAAP) for complete financial statements. However, in the opinion of management, all adjustments (consisting of normal recurring accruals) have been made that are necessary for a fair presentation of the condensed consolidated financial statements for the interim periods. This Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in Eaton’s 2022 Form 10-K. The interim period results are not necessarily indicative of the results to be expected for the full year. Management has evaluated subsequent events through the date this Form 10-Q was filed with the Securities and Exchange Commission. Adoption of New Accounting Standard Eaton adopted Accounting Standards Update 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, in the first quarter of 2023. The standard requires disclosure of certain information about the Company's supply chain finance program, including key terms and a rollforward of confirmed amounts payable. The adoption of the standard did not have a material impact on the condensed consolidated financial statements. |
ACQUISITIONS AND DIVESTITURES O
ACQUISITIONS AND DIVESTITURES OF BUSINESSES | 6 Months Ended |
Jun. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS AND DIVESTITURES OF BUSINESSES | ACQUISITIONS AND DIVESTITURE OF BUSINESSES Sale of Hydraulics business On August 2, 2021, Eaton completed the sale of the Hydraulics business to Danfoss A/S and recognized a pre-tax gain of $617 million in 2021. The Company finalized negotiations of post-closing adjustments with Danfoss A/S and recognized an additional pre-tax gain of $24 million in the first quarter of 2022 and received cash of $22 million in the second quarter of 2022 from Danfoss A/S to fully settle all post-closing adjustments. Acquisition of Royal Power Solutions On January 5, 2022, Eaton acquired Royal Power Solutions for $610 million, net of cash received. Royal Power Solutions is a U.S. based manufacturer of high-precision electrical connectivity components used in electric vehicle, energy management, industrial and mobility markets. Royal Power Solutions is reported within the eMobility business segment. Eaton's 2022 Condensed Consolidated Financial Statements include Royal Power Solutions' results of operations, including segment operating profit of $11 million on sales of $79 million, from the date of acquisition through June 30, 2022. Russia During the second quarter of 2022, in light of the ongoing war with Ukraine, the Company decided to exit its business operations in Russia and recorded charges of $29 million presented in Other expense (income) - net on the Consolidated Statements of Income. The charges consisted primarily of write-downs of accounts receivable, inventory and other assets, and accruals for severance. Acquisition of a 50% stake in Jiangsu Huineng Electric Co., Ltd’s circuit breaker business On July 1, 2022, Eaton acquired a 50 percent stake in Jiangsu Huineng Electric Co., Ltd’s circuit breaker business, which manufactures and markets low-voltage circuit breakers in China. Eaton accounts for this investment on the equity method of accounting and is reported within the Electrical Global business segment. Acquisition of a 49% stake in Jiangsu Ryan Electrical Co. Ltd. On April 23, 2023, Eaton acquired a 49 percent stake in Jiangsu Ryan Electrical Co. Ltd., a manufacturer of power distribution and sub-transmission transformers in China. Eaton accounts for this investment on the equity method of accounting and is reported within the Electrical Global business segment. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION Sales are recognized when obligations under the terms of the contract are satisfied and control of promised goods or services have transferred to our customers. Control is transferred when the customer has the ability to direct the use of and obtain benefits from the goods or services. Sales are measured at the amount of consideration the Company expects to be paid in exchange for these products or services. The following table provides disaggregated sales by lines of businesses, geographic destination, market channel or end market, as applicable, for the Company's operating segments: Three months ended Six months ended (In millions) 2023 2022 2023 2022 Electrical Americas Products $ 757 $ 695 $ 1,473 $ 1,298 Systems 1,781 1,436 3,359 2,724 Total $ 2,538 $ 2,131 $ 4,832 $ 4,022 Electrical Global Products $ 889 $ 878 $ 1,772 $ 1,754 Systems 680 617 1,297 1,178 Total $ 1,569 $ 1,495 $ 3,069 $ 2,932 Aerospace Original Equipment Manufacturers $ 324 $ 285 $ 638 $ 577 Aftermarket 297 242 561 463 Industrial and Other 226 215 451 419 Total $ 848 $ 742 $ 1,650 $ 1,459 Vehicle Commercial $ 459 $ 445 $ 907 $ 847 Passenger and Light Duty 292 263 583 532 Total $ 751 $ 708 $ 1,490 $ 1,379 eMobility $ 161 $ 136 $ 308 $ 262 Total net sales $ 5,866 $ 5,212 $ 11,349 $ 10,054 The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (revenue recognized exceeds amount billed to the customer), and deferred revenue (advance payments and billings in excess of revenue recognized). Accounts receivable from customers were $3,876 million and $3,581 million at June 30, 2023 and December 31, 2022, respectively. Amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals or upon achievement of contractual milestones. These assets and liabilities are reported on the Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period. Unbilled receivables were $287 million and $233 million at June 30, 2023 and December 31, 2022, respectively, and are recorded in Prepaid expenses and other current assets. The increase in unbilled receivables reflects higher revenue recognized from increased business activity in 2023. Changes in the deferred revenue liabilities are as follows: (In millions) Deferred Revenue Balance at January 1, 2023 $ 508 Customer deposits and billings 1,052 Revenue recognized in the period (949) Translation 9 Balance at June 30, 2023 $ 620 (In millions) Deferred Revenue Balance at January 1, 2022 $ 422 Customer deposits and billings 742 Revenue recognized in the period (705) Translation (15) Balance at June 30, 2022 $ 444 Deferred revenue liabilities of $604 million and $489 million as of June 30, 2023 and December 31, 2022, respectively, were included in Other current liabilities with the remaining balance presented in Other noncurrent liabilities. |
CREDIT LOSSES FOR RECEIVABLES
CREDIT LOSSES FOR RECEIVABLES | 6 Months Ended |
Jun. 30, 2023 | |
Credit Loss [Abstract] | |
CREDIT LOSSES FOR RECEIVABLES | CREDIT LOSSES FOR RECEIVABLES Receivables are exposed to credit risk based on the customers’ ability to pay which is influenced by, among other factors, their financial liquidity position. Eaton’s receivables are generally short-term in nature with a majority outstanding less than 90 days. Eaton performs ongoing credit evaluation of its customers and maintains sufficient allowances for potential credit losses. The Company evaluates the collectability of its receivables based on the length of time the receivable is past due, and any anticipated future write-off based on historic experience adjusted for market conditions. The Company's segments, supported by our global credit department, perform the credit evaluation and monitoring process to estimate and manage credit risk. The process includes an evaluation of credit losses for both the overall segment receivable and specific customer balances. The process also includes review of customer financial information and credit ratings, approval and monitoring of customer credit limits, and an assessment of market conditions. The Company may also require prepayment from customers to mitigate credit risk. Receivable balances are written off against an allowance for credit losses after a final determination of collectability has been made. Accounts receivable are net of an allowance for credit losses of $39 million and $31 million at June 30, 2023 and December 31, 2022, respectively. The change in the allowance for credit losses includes expense and net write-offs, none of which are significant. |
INVENTORY
INVENTORY | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY Inventory is carried at lower of cost or net realizable value. The components of inventory are as follows: (In millions) June 30, December 31, Raw materials $ 1,458 $ 1,275 Work-in-process 930 781 Finished goods 1,282 1,375 Total inventory $ 3,670 $ 3,430 |
GOODWILL
GOODWILL | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | GOODWILL Changes in the carrying amount of goodwill by segment are as follows: (In millions) January 1, 2023 Translation June 30, 2023 Electrical Americas $ 7,402 $ 11 $ 7,413 Electrical Global 3,929 59 3,988 Aerospace 2,844 47 2,891 Vehicle 287 1 289 eMobility 334 — 334 Total $ 14,796 $ 118 $ 14,914 |
SUPPLY CHAIN FINANCE PROGRAM
SUPPLY CHAIN FINANCE PROGRAM | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
SUPPLY CHAIN FINANCE PROGRAM | SUPPLY CHAIN FINANCE PROGRAM The Company negotiates payment terms directly with its suppliers for the purchase of goods and services. In addition, a third-party financial institution offers a voluntary supply chain finance (SCF) program that enables certain of the Company’s suppliers, at the supplier’s sole discretion, to sell receivables due from the Company to the financial institution on terms directly negotiated with the financial institution. If a supplier elects to participate in the SCF program, the supplier decides which invoices are sold to the financial institution and the Company has no economic interest in a supplier’s decision to sell an invoice. Payments by the Company to participating suppliers are paid to the financial institution on the invoice due date, regardless of whether an individual invoice is sold by the supplier to the financial institution. The amounts due to the financial institution for suppliers that participate in the SCF program are included in Accounts payable on the Consolidated Balance Sheets, and the associated payments are included in operating activities on the Condensed Consolidated Statements of Cash Flows. The changes in SCF obligations are as follows: (In millions) SCF Obligations Balance at January 1, 2023 $ 208 Invoices confirmed during the period 634 Invoices paid during the period (519) Translation 13 Balance at June 30, 2023 $ 336 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT On May 18, 2023, Eaton issued senior notes (2023 Notes) with a face amount of $500 million. The 2023 Notes mature in 2028 with interest payable semi-annually at a rate of 4.35% per annum. The issuer received proceeds totaling $497 million from the issuance, net of financing costs. The 2023 Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The 2023 Notes contain customary optional redemption and par call provisions. The 2023 Notes also contain a provision which upon a change of control requires the Company to make an offer to purchase all or any part of the 2023 Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The 2023 Notes are subject to customary non-financial covenants. On March 3, 2023, a subsidiary of Eaton issued Euro denominated notes (2023 Euro Notes) in a private issuance with a face value of €300 million ($318 million). The floating rate notes are due June 3, 2024 with interest payable quarterly based on the three-month Euro Interbank Offered Rate plus 25 basis points. The 2023 Euro Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton. The 2023 Euro Notes contain a change of control provision which requires the Company to make an offer to purchase all or any part of the 2023 Euro Notes at a purchase price of 100.5% of the principal amount plus accrued and unpaid interest. The 2023 Euro Notes are subject to customary non-financial covenants. |
RETIREMENT BENEFITS PLANS
RETIREMENT BENEFITS PLANS | 6 Months Ended |
Jun. 30, 2023 | |
Retirement Benefits [Abstract] | |
RETIREMENT BENEFITS PLANS | RETIREMENT BENEFITS PLANS The components of retirement benefits expense (income) are as follows: United States Non-United States Other postretirement Three months ended June 30 (In millions) 2023 2022 2023 2022 2023 2022 Service cost $ 5 $ 8 $ 10 $ 14 $ — $ 1 Interest cost 35 28 21 12 3 1 Expected return on plan assets (49) (52) (30) (29) — — Amortization 1 4 3 12 (5) (2) (8) (12) 4 9 (2) — Settlements 10 17 — 1 — — Total expense (income) $ 2 $ 5 $ 4 $ 10 $ (2) $ — United States Non-United States Other postretirement Six months ended June 30 (In millions) 2023 2022 2023 2022 2023 2022 Service cost $ 10 $ 16 $ 21 $ 30 $ — $ 1 Interest cost 71 48 42 24 5 3 Expected return on plan assets (98) (105) (60) (60) — — Amortization 2 12 4 24 (9) (4) (15) (29) 7 18 (3) — Settlements 19 31 1 1 — — Total expense (income) $ 4 $ 2 $ 8 $ 19 $ (3) $ — The components of retirement benefits expense (income) other than service costs are included in Other expense (income) - net. During 2020, the Company announced it was freezing its United States pension plans for its non-union employees. The freeze was effective January 1, 2021 for non-union U.S. employees whose retirement benefit was determined under a cash balance formula and is effective January 1, 2026 for non-union U.S. employees whose retirement benefit is determined under a final average pay formula. |
LEGAL CONTINGENCIES
LEGAL CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL CONTINGENCIES | LEGAL CONTINGENCIES Eaton is subject to a broad range of claims, administrative and legal proceedings such as lawsuits that relate to contractual allegations and indemnity claims, tax audits, patent infringement, personal injuries, antitrust matters, and employment-related matters. Eaton is also subject to legal claims from historic products which may have contained asbestos. Insurance may cover some of the costs associated with these claims and proceedings. Although it is not possible to predict with certainty the outcome or cost of these matters, the Company believes they will not have a material adverse effect on the Condensed Consolidated Financial Statements. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXESThe effective income tax rate for the second quarter of 2023 was expense of 17.0% compared to expense of 16.5% for the second quarter of 2022. The effective income tax rate for the first six months of 2023 was expense of 16.6% compared to expense of 15.3% for the first six months of 2022. The increase in the effective tax rate in the second quarter and first six months of 2023 was primarily due to greater levels of income in higher tax jurisdictions. |
EQUITY
EQUITY | 6 Months Ended |
Jun. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
EQUITY | EQUITY The changes in Shareholders’ equity are as follows: Ordinary shares Capital in excess of par value Retained earnings Accumulated other comprehensive loss Shares held in trust Total Eaton shareholders' equity Noncontrolling interests Total equity (In millions) Shares Dollars Balance at January 1, 2023 397.8 $ 4 $ 12,512 $ 8,468 $ (3,946) $ (1) $ 17,038 $ 38 $ 17,075 Net income — — — 638 — — 638 1 639 Other comprehensive income, net of tax 132 132 — 132 Cash dividends paid and accrued — — — (348) — — (348) (4) (352) Issuance of shares under equity-based 0.7 — (11) (1) — 1 (11) — (11) Changes in noncontrolling interest of — — — — — — — 1 1 Balance at March 31, 2023 398.6 $ 4 $ 12,502 $ 8,757 $ (3,814) $ — $ 17,449 $ 36 $ 17,485 Net income — — — 744 — — 744 1 745 Other comprehensive income, net of tax 53 53 53 Cash dividends paid — — — (344) — — (344) — (344) Issuance of shares under equity-based 0.4 — 52 (1) — (1) 51 — 51 Changes in noncontrolling interest of — — — — — — — (1) (1) Balance at June 30, 2023 399.0 $ 4 $ 12,554 $ 9,156 $ (3,760) $ (1) $ 17,953 $ 36 $ 17,988 Ordinary shares Capital in excess of par value Retained earnings Accumulated other comprehensive loss Shares held in trust Total Eaton shareholders' equity Noncontrolling interests Total equity (In millions) Shares Dollars Balance at January 1, 2022 398.8 $ 4 $ 12,449 $ 7,594 $ (3,633) $ (1) $ 16,413 $ 38 $ 16,451 Net income — — — 532 — — 532 1 533 Other comprehensive income, net of tax 116 116 — 116 Cash dividends paid and accrued — — — (331) — — (331) (2) (333) Issuance of shares under equity-based 0.8 — (22) (2) — — (24) — (24) Changes in noncontrolling interest of — — — — — — — (1) (1) Repurchase of shares (0.6) — — (86) — — (86) — (86) Balance at March 31, 2022 399.0 $ 4 $ 12,427 $ 7,707 $ (3,517) $ (1) $ 16,620 $ 36 $ 16,656 Net income — — — 601 — — 601 — 601 Other comprehensive loss, net of tax (444) (444) (444) Cash dividends paid — — — (323) — — (323) — (323) Issuance of shares under equity-based — — 26 1 — — 27 — 27 Changes in noncontrolling interest of — — (1) — — — (1) — (1) Repurchase of shares (0.7) — — (100) — — (100) — (100) Balance at June 30, 2022 398.3 $ 4 $ 12,452 $ 7,886 $ (3,961) $ (1) $ 16,380 $ 36 $ 16,416 On February 27, 2019, the Board of Directors adopted a share repurchase program for share repurchases up to $5.0 billion of ordinary shares (2019 Program). On February 23, 2022, the Board renewed the 2019 Program by providing authority for up to $5.0 billion in repurchases to be made during the three-year period commencing on that date (2022 Program). Under the 2022 Program, the ordinary shares are expected to be repurchased over time, depending on market conditions, the market price of ordinary shares, capital levels, and other considerations. During the three and six months ended June 30, 2023, no ordinary shares were repurchased. During the three and six months ended June 30, 2022, 0.7 million and 1.3 million ordinary shares, respectively, were repurchased under the 2022 program in the open market at a total cost of $100 million and $186 million, respectively. The changes in Accumulated other comprehensive loss are as follows: (In millions) Currency translation and related hedging instruments Pensions and other postretirement benefits Cash flow Total Balance at January 1, 2023 $ (3,264) $ (810) $ 129 $ (3,946) Other comprehensive income (loss) before 182 (19) 39 201 Amounts reclassified from Accumulated other (6) 15 (26) (16) Net current-period Other comprehensive 176 (5) 14 185 Balance at June 30, 2023 $ (3,088) $ (815) $ 143 $ (3,760) The reclassifications out of Accumulated other comprehensive loss are as follows: (In millions) Six months ended June 30, 2023 Consolidated Statements Gains and (losses) on net investment hedges (amount excluded Currency exchange contracts $ 6 Interest expense - net Tax expense — Total, net of tax 6 Amortization of defined benefits pensions and other postretirement benefits items Actuarial loss and prior service cost (17) 1 Tax benefit 2 Total, net of tax (15) Gains and (losses) on cash flow hedges Floating-to-fixed interest rate swaps 6 Interest expense - net Currency exchange contracts 26 Net sales and Cost of products sold Tax expense (7) Total, net of tax 26 Total reclassifications for the period $ 16 1 These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 9 for additional information about pension and other postretirement benefits items. Net Income Per Share Attributable to Eaton Ordinary Shareholders A summary of the calculation of net income per share attributable to Eaton ordinary shareholders is as follows: Three months ended Six months ended (In millions except for per share data) 2023 2022 2023 2022 Net income attributable to Eaton ordinary shareholders $ 744 $ 601 $ 1,382 $ 1,133 Weighted-average number of ordinary shares outstanding - diluted 400.7 400.7 400.6 401.2 Less dilutive effect of equity-based compensation 1.8 1.7 1.9 2.1 Weighted-average number of ordinary shares outstanding - basic 398.9 399.0 398.7 399.1 Net income per share attributable to Eaton ordinary shareholders Diluted $ 1.86 $ 1.50 $ 3.45 $ 2.82 Basic 1.86 1.51 3.47 2.84 For the second quarter and first six months of 2023, 0.1 million stock options were excluded from the calculation of diluted net income per share attributable to Eaton ordinary shareholders because the exercise price of the options exceeded the average market price of the ordinary shares during the period and their effect, accordingly, would have been antidilutive. For the second quarter and first six months of 2022, all stock options were included in the calculation of diluted net income per share attributable to Eaton ordinary shareholders because they were all dilutive. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value is measured based on an exit price, representing the amount that would be received to sell an asset or paid to satisfy a liability in an orderly transaction between market participants. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a fair value hierarchy is established, which categorizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. A summary of financial instruments and contingent consideration recognized at fair value, and the fair value measurements used, is as follows: (In millions) Total Level 1 Level 2 Level 3 June 30, 2023 Cash $ 353 $ 353 $ — $ — Short-term investments 977 977 — — Net derivative contracts 46 — 46 — Contingent future payments from acquisition of Green Motion (46) — — (46) December 31, 2022 Cash $ 294 $ 294 $ — $ — Short-term investments 261 261 — — Net derivative contracts 29 — 29 — Contingent future payments from acquisition of Green Motion (44) — — (44) Eaton values its financial instruments using an industry standard market approach, in which prices and other relevant information is generated by market transactions involving identical or comparable assets or liabilities. On March 22, 2021, Eaton acquired Green Motion SA, a leading designer and manufacturer of electric vehicle charging hardware and related software based in Switzerland. Green Motion SA was acquired for $106 million, including $49 million of cash paid at closing and an initial estimate of $57 million for the fair value of contingent future consideration based on 2023 and 2024 revenue performance. The fair value of contingent consideration liabilities is estimated by discounting contingent payments expected to be made, and may increase or decrease based on changes in revenue estimates and discount rates, with a maximum possible undiscounted value of $114 million. As of June 30, 2023, the fair value of the contingent future payments has been reduced to $46 million based primarily on anticipated reductions in projected 2023 revenue compared to the initial estimate. Other Fair Value Measurements Long-term debt and the current portion of long-term debt had a carrying value of $9,206 million and fair value of $8,622 million at June 30, 2023 compared to $8,331 million and $7,625 million, respectively, at December 31, 2022. The fair value of Eaton's debt instruments was estimated using prevailing market interest rates on debt with similar creditworthiness, terms and maturities and is considered a Level 2 fair value measurement. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | 6 Months Ended |
Jun. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES In the normal course of business, Eaton is exposed to certain risks related to fluctuations in interest rates, currency exchange rates and commodity prices. The Company uses various derivative and non-derivative financial instruments, primarily interest rate swaps, currency forward exchange contracts, currency swaps and commodity contracts to manage risks from these market fluctuations. The instruments used by Eaton are straightforward, non-leveraged instruments. The counterparties to these instruments are financial institutions with strong credit ratings. Eaton maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit rating of these institutions. Such instruments are not purchased and sold for trading purposes. Derivative financial instruments are accounted for at fair value and recognized as assets or liabilities in the Consolidated Balance Sheets. Accounting for the gain or loss resulting from the change in the fair value of the derivative financial instrument depends on whether it has been designated as part of a hedging relationship, is effective and the nature of the hedging activity. Eaton formally documents all relationships between derivative financial instruments accounted for as designated hedges and the hedged item, as well as its risk-management objective and strategy for undertaking the hedge transaction. This process includes linking derivative financial instruments to a recognized asset or liability, specific firm commitment, forecasted transaction, or net investment in a foreign operation. These financial instruments can be designated as: • Hedges of the change in the fair value of a recognized fixed-rate asset or liability, or the firm commitment to acquire such an asset or liability (a fair value hedge); for these hedges, the gain or loss from the derivative financial instrument, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized in income during the period of change in fair value. • Hedges of the variable cash flows of a recognized variable-rate asset or liability, or the forecasted acquisition of such an asset or liability (a cash flow hedge); for these hedges, the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive income and reclassified to income in the same period when the gain or loss on the hedged item is included in income. • Hedges of the currency exposure related to a net investment in a foreign operation (a net investment hedge); for these hedges, the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive income and reclassified to income in the same period when the gain or loss related to the net investment in the foreign operation is included in income. The gain or loss from a derivative financial instrument designated as a hedge is classified in the same line of the Consolidated Statements of Income as the offsetting loss or gain on the hedged item. The cash flows resulting from these financial instruments are classified in operating activities on the Condensed Consolidated Statements of Cash Flows. For derivatives that are not designated as a hedge, any gain or loss is immediately recognized in income. The majority of derivatives used in this manner relate to risks resulting from assets or liabilities denominated in a foreign currency and certain commodity contracts that arise in the normal course of business. Eaton uses currency exchange contracts and certain of its debt denominated in foreign currency to hedge portions of its net investments in foreign operations against foreign currency exposure (net investment hedges). The Company uses the spot rate method to assess hedge effectiveness when currency exchange contracts are used in net investment hedges. Under this method, changes in the spot exchange rate are recognized in Accumulated other comprehensive loss. Changes related to the forward rate are excluded from the hedging relationship and the forward points are amortized to Interest expense - net on a straight-line basis over the term of the contract. The cash flows resulting from these currency exchange contracts are classified in investing activities on the Condensed Consolidated Statements of Cash Flows. Derivative Financial Statement Impacts The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets is as follows: (In millions) Notional Other Other Other Other Type of Term June 30, 2023 Derivatives designated as hedges Currency exchange contracts $ 990 $ 52 $ 2 $ 16 $ 3 Cash flow 1 to 31 months Commodity contracts 27 1 — 1 — Cash flow 1 to 12 months Currency exchange contracts 557 3 — — — Net investment 3 months Total $ 55 $ 2 $ 17 $ 3 Derivatives not designated as hedges Currency exchange contracts $ 4,891 $ 19 $ 10 1 to 7 months December 31, 2022 Derivatives designated as hedges Currency exchange contracts $ 1,240 $ 35 $ 2 $ 17 $ 9 Cash flow 1 to 36 months Commodity contracts 64 4 — 2 — Cash flow 1 to 12 months Total $ 39 $ 2 $ 19 $ 9 Derivatives not designated as hedges Currency exchange contracts $ 4,683 $ 30 $ 14 1 to 12 months The currency exchange contracts shown in the table above as derivatives not designated as hedges are primarily contracts entered into to manage currency volatility or exposure on intercompany receivables, payables and loans. While Eaton does not elect hedge accounting treatment for these derivatives, Eaton targets managing 100% of the intercompany balance sheet exposure to minimize the effect of currency volatility related to the movement of goods and services in the normal course of its operations. This activity represents the great majority of these currency exchange contracts. The cash flows resulting from the settlement of these derivatives have been classified in investing activities in the Condensed Consolidated Statements of Cash Flows. Foreign currency denominated debt designated as non-derivative net investment hedging instruments had a carrying value on an after-tax basis of $3,092 million at June 30, 2023 and $2,711 million at December 31, 2022. As of June 30, 2023, the volume of outstanding commodity contracts that were entered into to hedge forecasted transactions: Commodity June 30, 2023 Term Aluminum 4 Millions of pounds 1 to 11 months Copper 3 Millions of pounds 1 to 7 months Gold 1,587 Troy ounces 1 to 12 months Silver 289,724 Troy ounces 1 to 7 months The following amounts were recorded on the Consolidated Balance Sheets related to fixed-to-floating interest rate swaps: (In millions) Carrying amount of the hedged Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged asset (liabilities) (a) Location on Consolidated Balance Sheets June 30, 2023 December 31, 2022 June 30, 2023 December 31, 2022 Long-term debt $ (713) $ (713) $ (45) $ (48) (a) At June 30, 2023 and December 31, 2022, these amounts include the cumulative liability amount of fair value hedging adjustments remaining for which the hedge accounting has been discontinued of $45 million and $48 million, respectively. The impact of cash flow and fair value hedging activities to the Consolidated Statements of Income is as follows: Three months ended June 30, 2023 (In millions) Net Sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 5,866 $ 3,747 $ 42 Gain (loss) on derivatives designated as cash flow hedges Forward starting floating-to-fixed interest rate swaps Hedged item $ — $ — $ (3) Derivative designated as hedging instrument — — 3 Currency exchange contracts Hedged item $ (1) $ (15) $ — Derivative designated as hedging instrument 1 15 — Three months ended June 30, 2022 (In millions) Net Sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 5,212 $ 3,505 $ 31 Gain (loss) on derivatives designated as cash flow hedges Currency exchange contracts Hedged item $ 2 $ (4) $ — Derivative designated as hedging instrument (2) 4 — Commodity contracts Hedged item $ — $ (1) $ — Derivative designated as hedging instrument — 1 — Six months ended June 30, 2023 (In millions) Net sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 11,349 $ 7,346 $ 91 Gain (loss) on derivatives designated as cash flow hedges Forward starting floating-to-fixed interest rate swaps Hedged item $ — $ — $ (6) Derivative designated as hedging instrument — — 6 Currency exchange contracts Hedged item $ 1 $ (30) $ — Derivative designated as hedging instrument (1) 30 — Six months ended June 30, 2022 (In millions) Net sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 10,054 $ 6,774 $ 63 Gain (loss) on derivatives designated as cash flow hedges Currency exchange contracts Hedged item $ 4 $ (7) $ — Derivative designated as hedging instrument (4) 7 — Commodity contracts Hedged item $ — $ (2) $ — Derivative designated as hedging instrument — 2 — Gain (loss) on derivatives designated as fair value hedges Fixed-to-floating interest rate swaps Hedged item $ — $ — $ 8 Derivative designated as hedging instrument — — (8) The impact of derivatives not designated as hedges to the Consolidated Statements of Income is as follows: Gain (loss) recognized in Consolidated Statements of Income Consolidated Statements of Income classification Three months ended (In millions) 2023 2022 Gain (loss) on derivatives not designated as hedges Currency exchange contracts $ 6 $ (25) Interest expense - net Commodity contracts — (16) Other expense (income) - net Total $ 6 $ (41) Gain (loss) recognized in Consolidated Statements of Income Consolidated Statements of Income classification Six months ended (In millions) 2023 2022 Gain (loss) on derivatives not designated as hedges Currency exchange contracts $ 17 $ (33) Interest expense - net Commodity contracts — (15) Other expense (income) - net and Cost of products sold (a) Total $ 17 $ (48) (a) In the second quarter of 2022, Eaton changed the presentation of gains and losses associated with derivative contracts for commodities that are not designated as hedges from Cost of products sold to Other expense (income) - net on the Consolidated Statements of Income. Prior period amounts have not been reclassified as they are not material. The impact of derivative and non-derivative instruments designated as hedges to the Consolidated Statements of Income and Comprehensive Income is as follows: Gain (loss) recognized in Location of gain (loss) Gain (loss) reclassified Three months ended Three months ended (In millions) 2023 2022 2023 2022 Derivatives designated as Forward starting floating-to-fixed $ 1 $ 113 Interest expense - net $ 3 $ — Currency exchange contracts 18 (10) Net sales and Cost of products sold 15 4 Commodity contracts (2) (12) Cost of products sold — 1 Derivatives designated as net Currency exchange contracts Effective portion 32 — Gain (loss) on sale of business — — Amount excluded from effectiveness 4 — Interest expense - net 4 — Non-derivative designated as net Foreign currency denominated debt (3) 179 Gain (loss) on sale of business — — Total $ 50 $ 270 $ 22 $ 5 Gain (loss) recognized in Location of gain (loss) Gain (loss) reclassified Six months ended Six months ended (In millions) 2023 2022 2023 2022 Derivatives designated as cash Forward starting floating-to-fixed $ 1 $ 237 Interest expense - net $ 6 $ — Currency exchange contracts 49 (10) Net sales and Cost of products sold 26 4 Commodity contracts — (7) Cost of products sold — 2 Derivatives designated as net Currency exchange contracts Effective portion 18 — Gain (loss) on sale of business — — Amount excluded from effectiveness 9 — Interest expense - net 6 — Non-derivative designated as net Foreign currency denominated debt (66) 241 Gain (loss) on sale of business — — Total $ 11 $ 461 $ 38 $ 6 The pre-tax portion of the fair value of currency exchange contracts designated as net investment hedges included in Accumulated other comprehensive loss were net gains of $18 million at June 30, 2023. The pre-tax portion of the fair value of the forward points included in Accumulated other comprehensive loss were net gains of $9 million at June 30, 2023. At June 30, 2023, a gain of $36 million of estimated unrealized net gains or losses associated with our cash flow hedges were expected to be reclassified to income from Accumulated other comprehensive loss within the next twelve months. These reclassifications relate to our designated foreign currency and commodity hedges that will mature in the next 12 months. |
RESTRUCTURING CHARGES
RESTRUCTURING CHARGES | 6 Months Ended |
Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING CHARGES | RESTRUCTURING CHARGES In the second quarter of 2020, Eaton initiated a multi-year restructuring program to reduce its cost structure and gain efficiencies in its business segments and at corporate in order to initially respond to declining market conditions brought on by the COVID-19 pandemic. Since the inception of the program, the Company has incurred charges of $364 million. These restructuring activities are expected to be completed in 2023 with total estimated charges of $380 million cumulatively for the entire program. The remaining charges in 2023 are expected to relate primarily to plant closing and other costs. A summary of restructuring program charges is as follows: Three months ended Six months ended (In millions except for per share data) 2023 2022 2023 2022 Workforce reductions $ 15 $ 2 $ 17 $ 7 Plant closing and other 15 8 22 21 Total before income taxes 29 10 39 28 Income tax benefit 6 2 8 6 Total after income taxes $ 24 $ 8 $ 31 $ 22 Per ordinary share - diluted $ 0.06 $ 0.02 $ 0.08 $ 0.05 Restructuring program charges related to the following segments: Three months ended Six months ended (In millions) 2023 2022 2023 2022 Electrical Americas $ 1 $ 5 $ 3 $ 10 Electrical Global 14 1 18 6 Aerospace 2 2 3 5 Vehicle 1 3 3 6 eMobility 6 — 7 — Corporate 5 — 6 2 Total $ 29 $ 10 $ 39 $ 28 A summary of liabilities related to workforce reductions, plant closing and other associated costs is as follows: (In millions) Workforce reductions Plant closing and other Total Balance at January 1, 2020 $ — $ — $ — Liability recognized 172 42 214 Payments, utilization and translation (33) (39) (72) Balance at December 31, 2020 139 3 142 Liability recognized 21 57 78 Payments, utilization and translation (64) (52) (116) Balance at December 31, 2021 96 8 104 Liability recognized, net 1 (13) 47 33 Payments, utilization and translation (45) (51) (96) Balance at December 31, 2022 38 4 41 Liability recognized, net 17 22 39 Payments (10) (20) (30) Balance at June 30, 2023 $ 45 $ 6 $ 51 1 The restructuring program liability was adjusted by $30 million in 2022 related to true-ups for completed workforce reductions and the decision not to close a facility in the Vehicle segment that was previously included in the program. These restructuring program charges were included in Cost of products sold, Selling and administrative expense, Research and development expense, or Other expense (income) - net, as appropriate. In Business Segment Information, these restructuring program charges are treated as Corporate items. See Note 16 for additional information about business segments. |
BUSINESS SEGMENT INFORMATION
BUSINESS SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENT INFORMATION | BUSINESS SEGMENT INFORMATION Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker, or decision making group, in deciding how to allocate resources to an individual segment and in assessing performance. Eaton's operating segments are Electrical Americas, Electrical Global, Aerospace, Vehicle, and eMobility. Operating profit includes the operating profit from intersegment sales. For additional information regarding Eaton's business segments, see Note 17 to the Consolidated Financial Statements contained in the 2022 Form 10-K. Three months ended Six months ended (In millions) 2023 2022 2023 2022 Net sales Electrical Americas $ 2,538 $ 2,131 $ 4,832 $ 4,022 Electrical Global 1,569 1,495 3,069 2,932 Aerospace 848 742 1,650 1,459 Vehicle 751 708 1,490 1,379 eMobility 161 136 308 262 Total net sales $ 5,866 $ 5,212 $ 11,349 $ 10,054 Segment operating profit (loss) Electrical Americas $ 669 $ 495 $ 1,194 $ 857 Electrical Global 290 282 564 561 Aerospace 191 163 371 321 Vehicle 115 108 222 221 eMobility (1) (2) (5) (5) Total segment operating profit 1,264 1,046 2,346 1,955 Corporate Intangible asset amortization expense (113) (122) (237) (250) Interest expense - net (42) (31) (91) (63) Pension and other postretirement benefits income 11 9 22 28 Restructuring program charges (29) (10) (39) (28) Other expense - net (192) (171) (340) (302) Income before income taxes 898 720 1,660 1,339 Income tax expense 153 119 276 205 Net income 745 601 1,384 1,135 Less net income for noncontrolling interests (1) — (3) (1) Net income attributable to Eaton ordinary shareholders $ 744 $ 601 $ 1,382 $ 1,133 |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements of Eaton Corporation plc (Eaton or the Company) have been prepared in accordance with generally accepted accounting principles for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles (US GAAP) for complete financial statements. However, in the opinion of management, all adjustments (consisting of normal recurring accruals) have been made that are necessary for a fair presentation of the condensed consolidated financial statements for the interim periods. This Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in Eaton’s 2022 Form 10-K. The interim period results are not necessarily indicative of the results to be expected for the full year. Management has evaluated subsequent events through the date this Form 10-Q was filed with the Securities and Exchange Commission. |
Adoption of New Accounting Standard | Adoption of New Accounting Standard Eaton adopted Accounting Standards Update 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, in the first quarter of 2023. The standard requires disclosure of certain information about the Company's supply chain finance program, including key terms and a rollforward of confirmed amounts payable. The adoption of the standard did not have a material impact on the condensed consolidated financial statements. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Sales | The following table provides disaggregated sales by lines of businesses, geographic destination, market channel or end market, as applicable, for the Company's operating segments: Three months ended Six months ended (In millions) 2023 2022 2023 2022 Electrical Americas Products $ 757 $ 695 $ 1,473 $ 1,298 Systems 1,781 1,436 3,359 2,724 Total $ 2,538 $ 2,131 $ 4,832 $ 4,022 Electrical Global Products $ 889 $ 878 $ 1,772 $ 1,754 Systems 680 617 1,297 1,178 Total $ 1,569 $ 1,495 $ 3,069 $ 2,932 Aerospace Original Equipment Manufacturers $ 324 $ 285 $ 638 $ 577 Aftermarket 297 242 561 463 Industrial and Other 226 215 451 419 Total $ 848 $ 742 $ 1,650 $ 1,459 Vehicle Commercial $ 459 $ 445 $ 907 $ 847 Passenger and Light Duty 292 263 583 532 Total $ 751 $ 708 $ 1,490 $ 1,379 eMobility $ 161 $ 136 $ 308 $ 262 Total net sales $ 5,866 $ 5,212 $ 11,349 $ 10,054 |
Schedule of Changes in Deferred Revenue Liabilities | Changes in the deferred revenue liabilities are as follows: (In millions) Deferred Revenue Balance at January 1, 2023 $ 508 Customer deposits and billings 1,052 Revenue recognized in the period (949) Translation 9 Balance at June 30, 2023 $ 620 (In millions) Deferred Revenue Balance at January 1, 2022 $ 422 Customer deposits and billings 742 Revenue recognized in the period (705) Translation (15) Balance at June 30, 2022 $ 444 |
INVENTORY (Tables)
INVENTORY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Components of Inventory | The components of inventory are as follows: (In millions) June 30, December 31, Raw materials $ 1,458 $ 1,275 Work-in-process 930 781 Finished goods 1,282 1,375 Total inventory $ 3,670 $ 3,430 |
GOODWILL (Tables)
GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill by segment are as follows: (In millions) January 1, 2023 Translation June 30, 2023 Electrical Americas $ 7,402 $ 11 $ 7,413 Electrical Global 3,929 59 3,988 Aerospace 2,844 47 2,891 Vehicle 287 1 289 eMobility 334 — 334 Total $ 14,796 $ 118 $ 14,914 |
SUPPLY CHAIN FINANCE PROGRAM (T
SUPPLY CHAIN FINANCE PROGRAM (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of changes in SCF obligations | The changes in SCF obligations are as follows: (In millions) SCF Obligations Balance at January 1, 2023 $ 208 Invoices confirmed during the period 634 Invoices paid during the period (519) Translation 13 Balance at June 30, 2023 $ 336 |
RETIREMENT BENEFIT PLANS (Table
RETIREMENT BENEFIT PLANS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Retirement Benefits [Abstract] | |
Schedule of Retirement Benefits Expense | The components of retirement benefits expense (income) are as follows: United States Non-United States Other postretirement Three months ended June 30 (In millions) 2023 2022 2023 2022 2023 2022 Service cost $ 5 $ 8 $ 10 $ 14 $ — $ 1 Interest cost 35 28 21 12 3 1 Expected return on plan assets (49) (52) (30) (29) — — Amortization 1 4 3 12 (5) (2) (8) (12) 4 9 (2) — Settlements 10 17 — 1 — — Total expense (income) $ 2 $ 5 $ 4 $ 10 $ (2) $ — United States Non-United States Other postretirement Six months ended June 30 (In millions) 2023 2022 2023 2022 2023 2022 Service cost $ 10 $ 16 $ 21 $ 30 $ — $ 1 Interest cost 71 48 42 24 5 3 Expected return on plan assets (98) (105) (60) (60) — — Amortization 2 12 4 24 (9) (4) (15) (29) 7 18 (3) — Settlements 19 31 1 1 — — Total expense (income) $ 4 $ 2 $ 8 $ 19 $ (3) $ — |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Changes in Shareholders' Equity | The changes in Shareholders’ equity are as follows: Ordinary shares Capital in excess of par value Retained earnings Accumulated other comprehensive loss Shares held in trust Total Eaton shareholders' equity Noncontrolling interests Total equity (In millions) Shares Dollars Balance at January 1, 2023 397.8 $ 4 $ 12,512 $ 8,468 $ (3,946) $ (1) $ 17,038 $ 38 $ 17,075 Net income — — — 638 — — 638 1 639 Other comprehensive income, net of tax 132 132 — 132 Cash dividends paid and accrued — — — (348) — — (348) (4) (352) Issuance of shares under equity-based 0.7 — (11) (1) — 1 (11) — (11) Changes in noncontrolling interest of — — — — — — — 1 1 Balance at March 31, 2023 398.6 $ 4 $ 12,502 $ 8,757 $ (3,814) $ — $ 17,449 $ 36 $ 17,485 Net income — — — 744 — — 744 1 745 Other comprehensive income, net of tax 53 53 53 Cash dividends paid — — — (344) — — (344) — (344) Issuance of shares under equity-based 0.4 — 52 (1) — (1) 51 — 51 Changes in noncontrolling interest of — — — — — — — (1) (1) Balance at June 30, 2023 399.0 $ 4 $ 12,554 $ 9,156 $ (3,760) $ (1) $ 17,953 $ 36 $ 17,988 Ordinary shares Capital in excess of par value Retained earnings Accumulated other comprehensive loss Shares held in trust Total Eaton shareholders' equity Noncontrolling interests Total equity (In millions) Shares Dollars Balance at January 1, 2022 398.8 $ 4 $ 12,449 $ 7,594 $ (3,633) $ (1) $ 16,413 $ 38 $ 16,451 Net income — — — 532 — — 532 1 533 Other comprehensive income, net of tax 116 116 — 116 Cash dividends paid and accrued — — — (331) — — (331) (2) (333) Issuance of shares under equity-based 0.8 — (22) (2) — — (24) — (24) Changes in noncontrolling interest of — — — — — — — (1) (1) Repurchase of shares (0.6) — — (86) — — (86) — (86) Balance at March 31, 2022 399.0 $ 4 $ 12,427 $ 7,707 $ (3,517) $ (1) $ 16,620 $ 36 $ 16,656 Net income — — — 601 — — 601 — 601 Other comprehensive loss, net of tax (444) (444) (444) Cash dividends paid — — — (323) — — (323) — (323) Issuance of shares under equity-based — — 26 1 — — 27 — 27 Changes in noncontrolling interest of — — (1) — — — (1) — (1) Repurchase of shares (0.7) — — (100) — — (100) — (100) Balance at June 30, 2022 398.3 $ 4 $ 12,452 $ 7,886 $ (3,961) $ (1) $ 16,380 $ 36 $ 16,416 |
Schedule of Accumulated Other Comprehensive Loss | The changes in Accumulated other comprehensive loss are as follows: (In millions) Currency translation and related hedging instruments Pensions and other postretirement benefits Cash flow Total Balance at January 1, 2023 $ (3,264) $ (810) $ 129 $ (3,946) Other comprehensive income (loss) before 182 (19) 39 201 Amounts reclassified from Accumulated other (6) 15 (26) (16) Net current-period Other comprehensive 176 (5) 14 185 Balance at June 30, 2023 $ (3,088) $ (815) $ 143 $ (3,760) |
Schedule of Reclassifications of Accumulated Other Comprehensive Loss | The reclassifications out of Accumulated other comprehensive loss are as follows: (In millions) Six months ended June 30, 2023 Consolidated Statements Gains and (losses) on net investment hedges (amount excluded Currency exchange contracts $ 6 Interest expense - net Tax expense — Total, net of tax 6 Amortization of defined benefits pensions and other postretirement benefits items Actuarial loss and prior service cost (17) 1 Tax benefit 2 Total, net of tax (15) Gains and (losses) on cash flow hedges Floating-to-fixed interest rate swaps 6 Interest expense - net Currency exchange contracts 26 Net sales and Cost of products sold Tax expense (7) Total, net of tax 26 Total reclassifications for the period $ 16 1 These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 9 for additional information about pension and other postretirement benefits items. |
Schedule of Net Income per Ordinary Share Attributable to Shareholders | A summary of the calculation of net income per share attributable to Eaton ordinary shareholders is as follows: Three months ended Six months ended (In millions except for per share data) 2023 2022 2023 2022 Net income attributable to Eaton ordinary shareholders $ 744 $ 601 $ 1,382 $ 1,133 Weighted-average number of ordinary shares outstanding - diluted 400.7 400.7 400.6 401.2 Less dilutive effect of equity-based compensation 1.8 1.7 1.9 2.1 Weighted-average number of ordinary shares outstanding - basic 398.9 399.0 398.7 399.1 Net income per share attributable to Eaton ordinary shareholders Diluted $ 1.86 $ 1.50 $ 3.45 $ 2.82 Basic 1.86 1.51 3.47 2.84 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Recognized at Fair Value and Fair Value Measurements Used | A summary of financial instruments and contingent consideration recognized at fair value, and the fair value measurements used, is as follows: (In millions) Total Level 1 Level 2 Level 3 June 30, 2023 Cash $ 353 $ 353 $ — $ — Short-term investments 977 977 — — Net derivative contracts 46 — 46 — Contingent future payments from acquisition of Green Motion (46) — — (46) December 31, 2022 Cash $ 294 $ 294 $ — $ — Short-term investments 261 261 — — Net derivative contracts 29 — 29 — Contingent future payments from acquisition of Green Motion (44) — — (44) |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Financial Instruments Recognized in Condensed Consolidated Balance Sheet | The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets is as follows: (In millions) Notional Other Other Other Other Type of Term June 30, 2023 Derivatives designated as hedges Currency exchange contracts $ 990 $ 52 $ 2 $ 16 $ 3 Cash flow 1 to 31 months Commodity contracts 27 1 — 1 — Cash flow 1 to 12 months Currency exchange contracts 557 3 — — — Net investment 3 months Total $ 55 $ 2 $ 17 $ 3 Derivatives not designated as hedges Currency exchange contracts $ 4,891 $ 19 $ 10 1 to 7 months December 31, 2022 Derivatives designated as hedges Currency exchange contracts $ 1,240 $ 35 $ 2 $ 17 $ 9 Cash flow 1 to 36 months Commodity contracts 64 4 — 2 — Cash flow 1 to 12 months Total $ 39 $ 2 $ 19 $ 9 Derivatives not designated as hedges Currency exchange contracts $ 4,683 $ 30 $ 14 1 to 12 months |
Schedule of Notional Amounts of Outstanding Derivative Positions | As of June 30, 2023, the volume of outstanding commodity contracts that were entered into to hedge forecasted transactions: Commodity June 30, 2023 Term Aluminum 4 Millions of pounds 1 to 11 months Copper 3 Millions of pounds 1 to 7 months Gold 1,587 Troy ounces 1 to 12 months Silver 289,724 Troy ounces 1 to 7 months |
Schedule of Derivative Instruments Recorded in Balance Sheet | The following amounts were recorded on the Consolidated Balance Sheets related to fixed-to-floating interest rate swaps: (In millions) Carrying amount of the hedged Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged asset (liabilities) (a) Location on Consolidated Balance Sheets June 30, 2023 December 31, 2022 June 30, 2023 December 31, 2022 Long-term debt $ (713) $ (713) $ (45) $ (48) (a) At June 30, 2023 and December 31, 2022, these amounts include the cumulative liability amount of fair value hedging adjustments remaining for which the hedge accounting has been discontinued of $45 million and $48 million, respectively. |
Schedule of Impact of Hedging Activities to Consolidated Statement of Income | The impact of cash flow and fair value hedging activities to the Consolidated Statements of Income is as follows: Three months ended June 30, 2023 (In millions) Net Sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 5,866 $ 3,747 $ 42 Gain (loss) on derivatives designated as cash flow hedges Forward starting floating-to-fixed interest rate swaps Hedged item $ — $ — $ (3) Derivative designated as hedging instrument — — 3 Currency exchange contracts Hedged item $ (1) $ (15) $ — Derivative designated as hedging instrument 1 15 — Three months ended June 30, 2022 (In millions) Net Sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 5,212 $ 3,505 $ 31 Gain (loss) on derivatives designated as cash flow hedges Currency exchange contracts Hedged item $ 2 $ (4) $ — Derivative designated as hedging instrument (2) 4 — Commodity contracts Hedged item $ — $ (1) $ — Derivative designated as hedging instrument — 1 — Six months ended June 30, 2023 (In millions) Net sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 11,349 $ 7,346 $ 91 Gain (loss) on derivatives designated as cash flow hedges Forward starting floating-to-fixed interest rate swaps Hedged item $ — $ — $ (6) Derivative designated as hedging instrument — — 6 Currency exchange contracts Hedged item $ 1 $ (30) $ — Derivative designated as hedging instrument (1) 30 — Six months ended June 30, 2022 (In millions) Net sales Cost of products sold Interest expense - net Amounts from Consolidated Statements of Income $ 10,054 $ 6,774 $ 63 Gain (loss) on derivatives designated as cash flow hedges Currency exchange contracts Hedged item $ 4 $ (7) $ — Derivative designated as hedging instrument (4) 7 — Commodity contracts Hedged item $ — $ (2) $ — Derivative designated as hedging instrument — 2 — Gain (loss) on derivatives designated as fair value hedges Fixed-to-floating interest rate swaps Hedged item $ — $ — $ 8 Derivative designated as hedging instrument — — (8) |
Schedule of Amounts Recognized in Net Income | The impact of derivatives not designated as hedges to the Consolidated Statements of Income is as follows: Gain (loss) recognized in Consolidated Statements of Income Consolidated Statements of Income classification Three months ended (In millions) 2023 2022 Gain (loss) on derivatives not designated as hedges Currency exchange contracts $ 6 $ (25) Interest expense - net Commodity contracts — (16) Other expense (income) - net Total $ 6 $ (41) Gain (loss) recognized in Consolidated Statements of Income Consolidated Statements of Income classification Six months ended (In millions) 2023 2022 Gain (loss) on derivatives not designated as hedges Currency exchange contracts $ 17 $ (33) Interest expense - net Commodity contracts — (15) Other expense (income) - net and Cost of products sold (a) Total $ 17 $ (48) (a) |
Schedule of Amounts Recognized in Accumulated Other Comprehensive Income | The impact of derivative and non-derivative instruments designated as hedges to the Consolidated Statements of Income and Comprehensive Income is as follows: Gain (loss) recognized in Location of gain (loss) Gain (loss) reclassified Three months ended Three months ended (In millions) 2023 2022 2023 2022 Derivatives designated as Forward starting floating-to-fixed $ 1 $ 113 Interest expense - net $ 3 $ — Currency exchange contracts 18 (10) Net sales and Cost of products sold 15 4 Commodity contracts (2) (12) Cost of products sold — 1 Derivatives designated as net Currency exchange contracts Effective portion 32 — Gain (loss) on sale of business — — Amount excluded from effectiveness 4 — Interest expense - net 4 — Non-derivative designated as net Foreign currency denominated debt (3) 179 Gain (loss) on sale of business — — Total $ 50 $ 270 $ 22 $ 5 Gain (loss) recognized in Location of gain (loss) Gain (loss) reclassified Six months ended Six months ended (In millions) 2023 2022 2023 2022 Derivatives designated as cash Forward starting floating-to-fixed $ 1 $ 237 Interest expense - net $ 6 $ — Currency exchange contracts 49 (10) Net sales and Cost of products sold 26 4 Commodity contracts — (7) Cost of products sold — 2 Derivatives designated as net Currency exchange contracts Effective portion 18 — Gain (loss) on sale of business — — Amount excluded from effectiveness 9 — Interest expense - net 6 — Non-derivative designated as net Foreign currency denominated debt (66) 241 Gain (loss) on sale of business — — Total $ 11 $ 461 $ 38 $ 6 |
RESTRUCTURING CHARGES (Tables)
RESTRUCTURING CHARGES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Program Charges | A summary of restructuring program charges is as follows: Three months ended Six months ended (In millions except for per share data) 2023 2022 2023 2022 Workforce reductions $ 15 $ 2 $ 17 $ 7 Plant closing and other 15 8 22 21 Total before income taxes 29 10 39 28 Income tax benefit 6 2 8 6 Total after income taxes $ 24 $ 8 $ 31 $ 22 Per ordinary share - diluted $ 0.06 $ 0.02 $ 0.08 $ 0.05 Restructuring program charges related to the following segments: Three months ended Six months ended (In millions) 2023 2022 2023 2022 Electrical Americas $ 1 $ 5 $ 3 $ 10 Electrical Global 14 1 18 6 Aerospace 2 2 3 5 Vehicle 1 3 3 6 eMobility 6 — 7 — Corporate 5 — 6 2 Total $ 29 $ 10 $ 39 $ 28 |
Schedule of Liabilities Related to Restructuring | A summary of liabilities related to workforce reductions, plant closing and other associated costs is as follows: (In millions) Workforce reductions Plant closing and other Total Balance at January 1, 2020 $ — $ — $ — Liability recognized 172 42 214 Payments, utilization and translation (33) (39) (72) Balance at December 31, 2020 139 3 142 Liability recognized 21 57 78 Payments, utilization and translation (64) (52) (116) Balance at December 31, 2021 96 8 104 Liability recognized, net 1 (13) 47 33 Payments, utilization and translation (45) (51) (96) Balance at December 31, 2022 38 4 41 Liability recognized, net 17 22 39 Payments (10) (20) (30) Balance at June 30, 2023 $ 45 $ 6 $ 51 1 The restructuring program liability was adjusted by $30 million in 2022 related to true-ups for completed workforce reductions and the decision not to close a facility in the Vehicle segment that was previously included in the program. |
BUSINESS SEGMENT INFORMATION (T
BUSINESS SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Business Segment Information | Three months ended Six months ended (In millions) 2023 2022 2023 2022 Net sales Electrical Americas $ 2,538 $ 2,131 $ 4,832 $ 4,022 Electrical Global 1,569 1,495 3,069 2,932 Aerospace 848 742 1,650 1,459 Vehicle 751 708 1,490 1,379 eMobility 161 136 308 262 Total net sales $ 5,866 $ 5,212 $ 11,349 $ 10,054 Segment operating profit (loss) Electrical Americas $ 669 $ 495 $ 1,194 $ 857 Electrical Global 290 282 564 561 Aerospace 191 163 371 321 Vehicle 115 108 222 221 eMobility (1) (2) (5) (5) Total segment operating profit 1,264 1,046 2,346 1,955 Corporate Intangible asset amortization expense (113) (122) (237) (250) Interest expense - net (42) (31) (91) (63) Pension and other postretirement benefits income 11 9 22 28 Restructuring program charges (29) (10) (39) (28) Other expense - net (192) (171) (340) (302) Income before income taxes 898 720 1,660 1,339 Income tax expense 153 119 276 205 Net income 745 601 1,384 1,135 Less net income for noncontrolling interests (1) — (3) (1) Net income attributable to Eaton ordinary shareholders $ 744 $ 601 $ 1,382 $ 1,133 |
ACQUISITIONS AND DIVESTITURES_2
ACQUISITIONS AND DIVESTITURES OF BUSINESSES - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||||
Jan. 05, 2022 | Aug. 02, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Apr. 23, 2023 | Jul. 01, 2022 | |
Business Acquisition [Line Items] | |||||||||
Cash purchase price, net of cash received | $ 0 | $ 612 | |||||||
Other expense - net | $ (7) | $ 41 | $ 4 | 50 | |||||
War With Russia And Ukraine | |||||||||
Business Acquisition [Line Items] | |||||||||
Other expense - net | 29 | ||||||||
Held-for-sale | Hydraulics Business | |||||||||
Business Acquisition [Line Items] | |||||||||
Consideration received, net of cash sold | $ 22 | 22 | |||||||
Disposed of by Sale | Hydraulics Business | |||||||||
Business Acquisition [Line Items] | |||||||||
Pre-tax gain (loss) on disposal | $ 617 | $ 24 | |||||||
Royal Power Solutions | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash purchase price, net of cash received | $ 610 | ||||||||
Operating profit of acquiree since acquisition date | 11 | ||||||||
Revenue of acquiree since acquisition date | $ 79 | ||||||||
Jiangsu Huineng Electric Co Ltd's circuit breaker business | |||||||||
Business Acquisition [Line Items] | |||||||||
Ownership interest acquired | 50% | ||||||||
Jiangsu Ryan Electrical Co. Ltd. | |||||||||
Business Acquisition [Line Items] | |||||||||
Ownership interest acquired | 49% |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Disaggregation of Revenue [Line Items] | ||
Accounts receivables from customers | $ 3,876 | $ 3,581 |
Unbilled receivables | 287 | 233 |
Deferred revenue liabilities, included in other current liabilities | 604 | $ 489 |
Backlog of unsatisfied or partially satisfied obligations | $ 12,500 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | ||
Disaggregation of Revenue [Line Items] | ||
Backlog expected to be recognized in the next twelve months, percent | 82% | |
Expected timing of satisfaction | 12 months |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 5,866 | $ 5,212 | $ 11,349 | $ 10,054 |
Electrical Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,538 | 2,131 | 4,832 | 4,022 |
Electrical Americas | Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 757 | 695 | 1,473 | 1,298 |
Electrical Americas | Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,781 | 1,436 | 3,359 | 2,724 |
Electrical Global | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,569 | 1,495 | 3,069 | 2,932 |
Electrical Global | Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 889 | 878 | 1,772 | 1,754 |
Electrical Global | Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 680 | 617 | 1,297 | 1,178 |
Aerospace | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 848 | 742 | 1,650 | 1,459 |
Aerospace | Original Equipment Manufacturers | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 324 | 285 | 638 | 577 |
Aerospace | Aftermarket | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 297 | 242 | 561 | 463 |
Aerospace | Industrial and Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 226 | 215 | 451 | 419 |
Vehicle | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 751 | 708 | 1,490 | 1,379 |
Vehicle | Commercial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 459 | 445 | 907 | 847 |
Vehicle | Passenger and Light Duty | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 292 | 263 | 583 | 532 |
eMobility | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 161 | $ 136 | $ 308 | $ 262 |
REVENUE RECOGNITION - Changes i
REVENUE RECOGNITION - Changes in Deferred Revenue Liabilities (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Movement in Deferred Revenue [Roll Forward] | ||
Balance at beginning of period | $ 508 | $ 422 |
Customer deposits and billings | 1,052 | 742 |
Revenue recognized in the period | (949) | (705) |
Translation | 9 | (15) |
Balance at end of period | $ 620 | $ 444 |
CREDIT LOSSES FOR RECEIVABLES (
CREDIT LOSSES FOR RECEIVABLES (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Credit Loss [Abstract] | ||
Allowance for credit losses | $ 39 | $ 31 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,458 | $ 1,275 |
Work-in-process | 930 | 781 |
Finished goods | 1,282 | 1,375 |
Total inventory | $ 3,670 | $ 3,430 |
GOODWILL (Details)
GOODWILL (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of period | $ 14,796 |
Translation | 118 |
Balance at end of period | 14,914 |
Electrical Americas | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 7,402 |
Translation | 11 |
Balance at end of period | 7,413 |
Electrical Global | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 3,929 |
Translation | 59 |
Balance at end of period | 3,988 |
Aerospace | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 2,844 |
Translation | 47 |
Balance at end of period | 2,891 |
Vehicle | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 287 |
Translation | 1 |
Balance at end of period | 289 |
eMobility | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 334 |
Translation | 0 |
Balance at end of period | $ 334 |
SUPPLY CHAIN FINANCE PROGRAM (D
SUPPLY CHAIN FINANCE PROGRAM (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Supplier Finance Program, Obligation [Roll Forward] | |
Balance at beginning period | $ 208 |
Invoices confirmed during the period | 634 |
Invoices paid during the period | (519) |
Translation | 13 |
Balance at ending period | $ 336 |
DEBT (Details)
DEBT (Details) € in Millions, $ in Millions | 6 Months Ended | ||||
May 18, 2023 USD ($) | Mar. 03, 2023 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Mar. 03, 2023 EUR (€) | |
Debt Instrument [Line Items] | |||||
Proceeds from borrowings | $ 818 | $ 0 | |||
2023 Notes | Senior notes | |||||
Debt Instrument [Line Items] | |||||
Face value of debt instrument | $ 500 | ||||
Debt instrument, stated interest rate (as a percent) | 4.35% | ||||
Proceeds from borrowings | $ 497 | ||||
Redemption price (as a percent) | 101% | ||||
2023 Euro Notes | Senior notes | |||||
Debt Instrument [Line Items] | |||||
Face value of debt instrument | $ 318 | € 300 | |||
Redemption price (as a percent) | 100.50% | ||||
2023 Euro Notes | Senior notes | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 0.25% |
RETIREMENT BENEFIT PLANS - Reti
RETIREMENT BENEFIT PLANS - Retirement Benefits Expense (Income) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Pension plan | United States pension benefit expense (income) | ||||
Retirement benefits plans expense (income) | ||||
Service cost | $ 5 | $ 8 | $ 10 | $ 16 |
Interest cost | 35 | 28 | 71 | 48 |
Expected return on plan assets | (49) | (52) | (98) | (105) |
Amortization | 1 | 4 | 2 | 12 |
Total | (8) | (12) | (15) | (29) |
Settlements | 10 | 17 | 19 | 31 |
Total expense (income) | 2 | 5 | 4 | 2 |
Pension plan | Foreign Plan | ||||
Retirement benefits plans expense (income) | ||||
Service cost | 10 | 14 | 21 | 30 |
Interest cost | 21 | 12 | 42 | 24 |
Expected return on plan assets | (30) | (29) | (60) | (60) |
Amortization | 3 | 12 | 4 | 24 |
Total | 4 | 9 | 7 | 18 |
Settlements | 0 | 1 | 1 | 1 |
Total expense (income) | 4 | 10 | 8 | 19 |
Postretirement plan | ||||
Retirement benefits plans expense (income) | ||||
Service cost | 0 | 1 | 0 | 1 |
Interest cost | 3 | 1 | 5 | 3 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization | (5) | (2) | (9) | (4) |
Total | (2) | 0 | (3) | 0 |
Settlements | 0 | 0 | 0 | 0 |
Total expense (income) | $ (2) | $ 0 | $ (3) | $ 0 |
RETIREMENT BENEFITS PLANS - Nar
RETIREMENT BENEFITS PLANS - Narrative (Details) - Pension plan - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Settlement loss | $ 10 | $ 18 | $ 20 | $ 32 |
Increase in accumulated other comprehensive loss | $ 137 | $ 90 | ||
Decrease in funded status | $ 137 | $ 90 |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate expense (as a percent) | 17% | 16.50% | 16.60% | 15.30% |
EQUITY - Changes in Shareholder
EQUITY - Changes in Shareholders' Equity (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | $ 17,485 | $ 17,075 | $ 16,656 | $ 16,451 | $ 17,075 | $ 16,451 |
Net income | 745 | 639 | 601 | 533 | 1,384 | 1,135 |
Other comprehensive income (loss), net of tax | 53 | 132 | (444) | 116 | 185 | (328) |
Cash dividends paid and accrued | (344) | (352) | (323) | (333) | ||
Issuance of shares under equity-based compensation plans | 51 | (11) | 27 | (24) | ||
Changes in noncontrolling interest of consolidated subsidiaries - net | (1) | 1 | (1) | |||
Changes in noncontrolling interest of consolidated subsidiaries - net | (1) | |||||
Repurchase of shares | (100) | (86) | ||||
Balance at end of period | 17,988 | 17,485 | 16,416 | 16,656 | 17,988 | 16,416 |
Total Eaton shareholders' equity | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | 17,449 | 17,038 | 16,620 | 16,413 | 17,038 | 16,413 |
Net income | 744 | 638 | 601 | 532 | ||
Other comprehensive income (loss), net of tax | 53 | 132 | (444) | 116 | ||
Cash dividends paid and accrued | (344) | (348) | (323) | (331) | ||
Issuance of shares under equity-based compensation plans | 51 | (11) | 27 | (24) | ||
Changes in noncontrolling interest of consolidated subsidiaries - net | (1) | |||||
Repurchase of shares | (100) | (86) | ||||
Balance at end of period | $ 17,953 | $ 17,449 | $ 16,380 | $ 16,620 | $ 17,953 | $ 16,380 |
Ordinary shares | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period (shares) | 398.6 | 397.8 | 399 | 398.8 | 397.8 | 398.8 |
Balance at beginning of period | $ 4 | $ 4 | $ 4 | $ 4 | $ 4 | $ 4 |
Issuance of shares under equity-based compensation plans (shares) | 0.4 | 0.7 | 0.8 | |||
Repurchase of shares (shares) | (0.7) | (0.6) | ||||
Balance at end of period (shares) | 399 | 398.6 | 398.3 | 399 | 399 | 398.3 |
Balance at end of period | $ 4 | $ 4 | $ 4 | $ 4 | $ 4 | $ 4 |
Capital in excess of par value | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | 12,502 | 12,512 | 12,427 | 12,449 | 12,512 | 12,449 |
Issuance of shares under equity-based compensation plans | 52 | (11) | 26 | (22) | ||
Changes in noncontrolling interest of consolidated subsidiaries - net | (1) | |||||
Balance at end of period | 12,554 | 12,502 | 12,452 | 12,427 | 12,554 | 12,452 |
Retained earnings | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | 8,757 | 8,468 | 7,707 | 7,594 | 8,468 | 7,594 |
Net income | 744 | 638 | 601 | 532 | ||
Cash dividends paid and accrued | (344) | (348) | (323) | (331) | ||
Issuance of shares under equity-based compensation plans | (1) | (1) | 1 | (2) | ||
Repurchase of shares | (100) | (86) | ||||
Balance at end of period | 9,156 | 8,757 | 7,886 | 7,707 | 9,156 | 7,886 |
Accumulated other comprehensive loss | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | (3,814) | (3,946) | (3,517) | (3,633) | (3,946) | (3,633) |
Other comprehensive income (loss), net of tax | 53 | 132 | (444) | 116 | ||
Balance at end of period | (3,760) | (3,814) | (3,961) | (3,517) | (3,760) | (3,961) |
Shares held in trust | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | 0 | (1) | (1) | (1) | (1) | (1) |
Issuance of shares under equity-based compensation plans | (1) | 1 | ||||
Balance at end of period | (1) | 0 | (1) | (1) | (1) | (1) |
Noncontrolling interests | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Balance at beginning of period | 36 | 38 | 36 | 38 | 38 | 38 |
Net income | 1 | 1 | 1 | |||
Cash dividends paid and accrued | (4) | (2) | ||||
Changes in noncontrolling interest of consolidated subsidiaries - net | (1) | 1 | (1) | |||
Balance at end of period | $ 36 | $ 36 | $ 36 | $ 36 | $ 36 | $ 36 |
EQUITY - Narrative (Details)
EQUITY - Narrative (Details) - USD ($) shares in Millions | 3 Months Ended | 6 Months Ended | ||||
Feb. 23, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Feb. 27, 2019 | |
Class of Stock [Line Items] | ||||||
Antidilutive shares excluded from net income per share (shares) | 0.1 | 0.1 | ||||
2019 Program | ||||||
Class of Stock [Line Items] | ||||||
Share repurchase program, authorized amount | $ 5,000,000,000 | |||||
2022 Program | ||||||
Class of Stock [Line Items] | ||||||
Share repurchase program, authorized amount | $ 5,000,000,000 | |||||
Stock repurchase period | 3 years | |||||
Ordinary shares purchased (shares) | 0.7 | 1.3 | ||||
Stock repurchased, value | $ 100,000,000 | $ 186,000,000 |
EQUITY - Changes in Accumulated
EQUITY - Changes in Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||
Balance at beginning of period | $ 17,485 | $ 17,075 | $ 16,656 | $ 16,451 | $ 17,075 | $ 16,451 |
Other comprehensive income (loss) before reclassifications | 201 | |||||
Amounts reclassified from Accumulated other comprehensive loss (income) | (16) | |||||
Other comprehensive income (loss) attributable to Eaton ordinary shareholders | 53 | 132 | (444) | 116 | 185 | (328) |
Balance at end of period | 17,988 | 17,485 | $ 16,416 | $ 16,656 | 17,988 | $ 16,416 |
Accumulated other comprehensive loss | ||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||
Balance at beginning of period | (3,946) | (3,946) | ||||
Balance at end of period | (3,760) | (3,760) | ||||
Currency translation and related hedging instruments | ||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||
Balance at beginning of period | (3,264) | (3,264) | ||||
Other comprehensive income (loss) before reclassifications | 182 | |||||
Amounts reclassified from Accumulated other comprehensive loss (income) | (6) | |||||
Other comprehensive income (loss) attributable to Eaton ordinary shareholders | 176 | |||||
Balance at end of period | (3,088) | (3,088) | ||||
Pensions and other postretirement benefits | ||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||
Balance at beginning of period | (810) | (810) | ||||
Other comprehensive income (loss) before reclassifications | (19) | |||||
Amounts reclassified from Accumulated other comprehensive loss (income) | 15 | |||||
Other comprehensive income (loss) attributable to Eaton ordinary shareholders | (5) | |||||
Balance at end of period | (815) | (815) | ||||
Cash flow hedges | ||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||
Balance at beginning of period | $ 129 | 129 | ||||
Other comprehensive income (loss) before reclassifications | 39 | |||||
Amounts reclassified from Accumulated other comprehensive loss (income) | (26) | |||||
Other comprehensive income (loss) attributable to Eaton ordinary shareholders | 14 | |||||
Balance at end of period | $ 143 | $ 143 |
EQUITY - Reclassifications Out
EQUITY - Reclassifications Out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income before income taxes | $ 898 | $ 720 | $ 1,660 | $ 1,339 |
Income tax benefit (expense) | (153) | (119) | (276) | (205) |
Net income attributable to Eaton ordinary shareholders | $ 744 | $ 601 | 1,382 | $ 1,133 |
Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net income attributable to Eaton ordinary shareholders | 16 | |||
Gains and (losses) on net investment hedges (amount excluded from effectiveness testing) | Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income before income taxes | 6 | |||
Income tax benefit (expense) | 0 | |||
Net income attributable to Eaton ordinary shareholders | 6 | |||
Pensions and other postretirement benefits | Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income before income taxes | (17) | |||
Income tax benefit (expense) | 2 | |||
Net income attributable to Eaton ordinary shareholders | (15) | |||
Gains and (losses) on cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income tax benefit (expense) | (7) | |||
Net income attributable to Eaton ordinary shareholders | 26 | |||
Gains and (losses) on cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | Fixed-to-floating interest rate swaps | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income before income taxes | 6 | |||
Gains and (losses) on cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | Currency exchange contracts | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Income before income taxes | $ 26 |
EQUITY - Calculation of Net Inc
EQUITY - Calculation of Net Income per Ordinary Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Calculation of net income per ordinary share attributable to ordinary shareholders | ||||
Net income attributable to Eaton ordinary shareholders | $ 744 | $ 601 | $ 1,382 | $ 1,133 |
Weighted-average number of ordinary shares outstanding - diluted (shares) | 400.7 | 400.7 | 400.6 | 401.2 |
Less dilutive effect of equity-based compensation (shares) | 1.8 | 1.7 | 1.9 | 2.1 |
Weighted-average number of ordinary shares outstanding - basic (shares) | 398.9 | 399 | 398.7 | 399.1 |
Net income per share attributable to Eaton ordinary shareholders | ||||
Diluted (USD per share) | $ 1.86 | $ 1.50 | $ 3.45 | $ 2.82 |
Basic (USD per share) | $ 1.86 | $ 1.51 | $ 3.47 | $ 2.84 |
FAIR VALUE MEASUREMENTS - Finan
FAIR VALUE MEASUREMENTS - Financial Instruments at Fair Value (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets Measured on Recurring Basis, Financial Statement Captions [Line Items] | ||
Cash | $ 353 | $ 294 |
Short-term investments | 977 | 261 |
Net derivative contracts | 46 | 29 |
Contingent future payments from acquisition of Green Motion | (46) | (44) |
Level 1 | ||
Fair Value, Assets Measured on Recurring Basis, Financial Statement Captions [Line Items] | ||
Cash | 353 | 294 |
Short-term investments | 977 | 261 |
Net derivative contracts | 0 | 0 |
Contingent future payments from acquisition of Green Motion | 0 | 0 |
Level 2 | ||
Fair Value, Assets Measured on Recurring Basis, Financial Statement Captions [Line Items] | ||
Cash | 0 | 0 |
Short-term investments | 0 | 0 |
Net derivative contracts | 46 | 29 |
Contingent future payments from acquisition of Green Motion | 0 | 0 |
Level 3 | ||
Fair Value, Assets Measured on Recurring Basis, Financial Statement Captions [Line Items] | ||
Cash | 0 | 0 |
Short-term investments | 0 | 0 |
Net derivative contracts | 0 | 0 |
Contingent future payments from acquisition of Green Motion | $ (46) | $ (44) |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Millions | Mar. 22, 2021 | Jun. 30, 2023 | Dec. 31, 2022 |
Business Acquisition [Line Items] | |||
Contingent future payments from acquisition | $ 46 | $ 44 | |
Long-term debt and current portion of long term debt, carrying value | 9,206 | 8,331 | |
Long-term debt and current portion of long-term debt, fair value | 8,622 | $ 7,625 | |
Green Motion, SA | |||
Business Acquisition [Line Items] | |||
Total consideration to be transferred for acquisition | $ 106 | ||
Cash paid at closing | 49 | ||
Contingent future payments from acquisition | 57 | $ 46 | |
Fair value of contingent future payments | $ 114 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Derivative [Line Items] | ||
Proportion of intercompany balance sheet exposure (as a percent) | 100% | |
Cash flow hedge gain (loss) to be reclassified within the next twelve months | $ 36 | |
Forward Starting Floating-to-Fixed Interest Rate Swap | ||
Derivative [Line Items] | ||
Pre-tax portion of fair value, gains (losses) | 9 | |
Non-derivative net investment hedge | ||
Derivative [Line Items] | ||
Foreign currency note payable, noncurrent, after-tax | 3,092 | $ 2,711 |
Net investment hedging | Currency exchange contracts | ||
Derivative [Line Items] | ||
Pre-tax portion of fair value, gains (losses) | $ 18 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Derivative Financial Instrument Recognized in the Consolidated Balance Sheet (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Derivatives designated as hedges | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | $ 55 | $ 39 |
Derivatives designated as hedges | Other noncurrent assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 2 | 2 |
Derivatives designated as hedges | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 17 | 19 |
Derivatives designated as hedges | Other noncurrent liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 3 | 9 |
Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | 990 | 1,240 |
Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 52 | 35 |
Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | Other noncurrent assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 2 | 2 |
Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 16 | 17 |
Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | Other noncurrent liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 3 | 9 |
Derivatives designated as hedges | Cash flow hedging | Commodity contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | 27 | 64 |
Derivatives designated as hedges | Cash flow hedging | Commodity contracts | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 1 | 4 |
Derivatives designated as hedges | Cash flow hedging | Commodity contracts | Other noncurrent assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 0 | 0 |
Derivatives designated as hedges | Cash flow hedging | Commodity contracts | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 1 | 2 |
Derivatives designated as hedges | Cash flow hedging | Commodity contracts | Other noncurrent liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 0 | 0 |
Derivatives designated as hedges | Net investment hedging | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | 557 | |
Derivatives designated as hedges | Net investment hedging | Currency exchange contracts | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 3 | |
Derivatives designated as hedges | Net investment hedging | Currency exchange contracts | Other noncurrent assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset designated as hedging instrument | 0 | |
Derivatives designated as hedges | Net investment hedging | Currency exchange contracts | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | 0 | |
Derivatives designated as hedges | Net investment hedging | Currency exchange contracts | Other noncurrent liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability designated as hedging instrument | $ 0 | |
Derivative, remaining maturity | 3 months | |
Derivatives not designated as hedges | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount | $ 4,891 | 4,683 |
Derivatives not designated as hedges | Currency exchange contracts | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset not designated as hedging instrument | 19 | 30 |
Derivatives not designated as hedges | Currency exchange contracts | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability not designated as hedging instrument | $ 10 | $ 14 |
Minimum | Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, remaining maturity | 1 month | 1 month |
Minimum | Derivatives designated as hedges | Cash flow hedging | Commodity contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, remaining maturity | 1 month | 1 month |
Minimum | Derivatives not designated as hedges | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, remaining maturity | 1 month | 1 month |
Maximum | Derivatives designated as hedges | Cash flow hedging | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, remaining maturity | 31 months | 36 months |
Maximum | Derivatives designated as hedges | Cash flow hedging | Commodity contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, remaining maturity | 12 months | 12 months |
Maximum | Derivatives not designated as hedges | Currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, remaining maturity | 7 months | 12 months |
DERIVATIVE FINANCIAL INSTRUME_5
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Volume of Outstanding Commodity Contracts (Details) - Commodity contracts lb in Millions | 6 Months Ended |
Jun. 30, 2023 lb ozt | |
Aluminum | |
Derivative [Line Items] | |
Derivative, outstanding commodity contract | lb | 4 |
Aluminum | Minimum | |
Derivative [Line Items] | |
Derivative, term of contract | 1 month |
Aluminum | Maximum | |
Derivative [Line Items] | |
Derivative, term of contract | 11 months |
Copper | |
Derivative [Line Items] | |
Derivative, outstanding commodity contract | lb | 3 |
Copper | Minimum | |
Derivative [Line Items] | |
Derivative, term of contract | 1 month |
Copper | Maximum | |
Derivative [Line Items] | |
Derivative, term of contract | 7 months |
Gold | |
Derivative [Line Items] | |
Derivative, outstanding commodity contract | ozt | 1,587 |
Gold | Minimum | |
Derivative [Line Items] | |
Derivative, term of contract | 1 month |
Gold | Maximum | |
Derivative [Line Items] | |
Derivative, term of contract | 12 months |
Silver | |
Derivative [Line Items] | |
Derivative, outstanding commodity contract | ozt | 289,724 |
Silver | Minimum | |
Derivative [Line Items] | |
Derivative, term of contract | 1 month |
Silver | Maximum | |
Derivative [Line Items] | |
Derivative, term of contract | 7 months |
DERIVATIVE FINANCIAL INSTRUME_6
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Amounts Recorded on Balance Sheet Related to Fixed-to-Floating Interest Rate Swaps (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Interest rate swap | ||
Derivative [Line Items] | ||
Carrying amount of the hedged assets (liabilities) | $ (713) | $ (713) |
Long-term debt | ||
Derivative [Line Items] | ||
Discontinued hedge, cumulative adjustment | (45) | (48) |
Long-term debt | Interest rate swap | ||
Derivative [Line Items] | ||
Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged asset (liabilities) | $ (45) | $ (48) |
DERIVATIVE FINANCIAL INSTRUME_7
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Impact of Derivatives on Consolidated Statement of Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Derivative [Line Items] | ||||
Net sales | $ 5,866 | $ 5,212 | $ 11,349 | $ 10,054 |
Cost of products sold | 3,747 | 3,505 | 7,346 | 6,774 |
Interest expense - net | 42 | 31 | 91 | 63 |
Cash flow hedging | Net sales | Forward starting floating-to-fixed interest rate swaps | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | 0 | ||
Gain (loss) on hedging instrument | 0 | 0 | ||
Cash flow hedging | Net sales | Currency exchange contracts | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | (1) | 2 | 1 | 4 |
Gain (loss) on hedging instrument | 1 | (2) | (1) | (4) |
Cash flow hedging | Net sales | Commodity contracts | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | 0 | ||
Gain (loss) on hedging instrument | 0 | 0 | ||
Cash flow hedging | Cost of products sold | Forward starting floating-to-fixed interest rate swaps | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | 0 | ||
Gain (loss) on hedging instrument | 0 | 0 | ||
Cash flow hedging | Cost of products sold | Currency exchange contracts | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | (15) | (4) | (30) | (7) |
Gain (loss) on hedging instrument | 15 | 4 | 30 | 7 |
Cash flow hedging | Cost of products sold | Commodity contracts | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | (1) | (2) | ||
Gain (loss) on hedging instrument | 1 | 2 | ||
Cash flow hedging | Interest expense - net | Forward starting floating-to-fixed interest rate swaps | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | (3) | (6) | ||
Gain (loss) on hedging instrument | 3 | 6 | ||
Cash flow hedging | Interest expense - net | Currency exchange contracts | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | 0 | 0 | 0 |
Gain (loss) on hedging instrument | $ 0 | 0 | $ 0 | 0 |
Cash flow hedging | Interest expense - net | Commodity contracts | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | 0 | ||
Gain (loss) on hedging instrument | $ 0 | 0 | ||
Fair value hedging | Net sales | Interest rate swap | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | |||
Gain (loss) on hedging instrument | 0 | |||
Fair value hedging | Cost of products sold | Interest rate swap | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 0 | |||
Gain (loss) on hedging instrument | 0 | |||
Fair value hedging | Interest expense - net | Interest rate swap | ||||
Derivative [Line Items] | ||||
Gain (loss) on hedged item | 8 | |||
Gain (loss) on hedging instrument | $ (8) |
DERIVATIVE FINANCIAL INSTRUME_8
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Impact of Derivatives Not Designated as Hedges (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 6 | $ (41) | $ 17 | $ (48) |
Currency exchange contracts | Interest expense - net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 6 | (25) | 17 | (33) |
Commodity contracts | Other expense (income) - net and Cost of products sold | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 0 | $ (16) | $ 0 | $ (15) |
DERIVATIVE FINANCIAL INSTRUME_9
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Amounts Recognized in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Gain (loss) recognized in other comprehensive income (loss) | ||||
Total, gain (loss) on derivative and net investment hedge recognized in other comprehensive (loss) income | $ 50 | $ 270 | $ 11 | $ 461 |
Gain (loss) reclassified from Accumulated other comprehensive loss | ||||
Total, gain (loss) on derivative and net investment hedge reclassified from accumulated other comprehensive (loss) income | 22 | 5 | 38 | 6 |
Interest expense - net | Net investment hedging | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Non-derivative designated as net investment hedges | (3) | 179 | (66) | 241 |
Gain (loss) reclassified from Accumulated other comprehensive loss | ||||
Gain (loss) on sale of business | 0 | 0 | 0 | 0 |
Forward Starting Floating-to-Fixed Interest Rate Swap | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Derivatives designated as cash flow hedges | 9 | |||
Forward Starting Floating-to-Fixed Interest Rate Swap | Interest expense - net | Cash flow hedging | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Derivatives designated as cash flow hedges | 1 | 113 | 1 | 237 |
Gain (loss) reclassified from Accumulated other comprehensive loss | ||||
Derivatives designated as cash flow hedges | 3 | 0 | 6 | 0 |
Currency exchange contracts | Net investment hedging | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Derivatives designated as cash flow hedges | 18 | |||
Currency exchange contracts | Net investment hedging | Derivatives designated as hedges | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Effective portion | 32 | 0 | 18 | 0 |
Amount excluded from effectiveness testing | 4 | 0 | 9 | 0 |
Gain (loss) reclassified from Accumulated other comprehensive loss | ||||
Interest expense - net | 4 | 0 | 6 | 0 |
Gain (loss) on sale of business | 0 | 0 | 0 | 0 |
Currency exchange contracts | Net sales and Cost of products sold | Cash flow hedging | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Derivatives designated as cash flow hedges | 18 | (10) | 49 | (10) |
Gain (loss) reclassified from Accumulated other comprehensive loss | ||||
Derivatives designated as cash flow hedges | 15 | 4 | 26 | 4 |
Commodity contracts | Cost of products sold | Cash flow hedging | ||||
Gain (loss) recognized in other comprehensive income (loss) | ||||
Derivatives designated as cash flow hedges | (2) | (12) | 0 | (7) |
Gain (loss) reclassified from Accumulated other comprehensive loss | ||||
Derivatives designated as cash flow hedges | $ 0 | $ 1 | $ 0 | $ 2 |
RESTRUCTURING CHARGES - Narrati
RESTRUCTURING CHARGES - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | 39 Months Ended | ||||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring charges | $ 29 | $ 10 | $ 39 | $ 28 | $ 33 | $ 78 | $ 214 | |
COVID-19 | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring charges | $ 364 | |||||||
Estimated charges | $ 380 | $ 380 | $ 380 |
RESTRUCTURING CHARGES - Restruc
RESTRUCTURING CHARGES - Restructuring Program Charges (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||||||
Total before income taxes | $ 29 | $ 10 | $ 39 | $ 28 | $ 33 | $ 78 | $ 214 |
Income tax benefit | 6 | 2 | 8 | 6 | |||
Total after income taxes | $ 24 | $ 8 | $ 31 | $ 22 | |||
Per ordinary share - diluted (USD per share) | $ 0.06 | $ 0.02 | $ 0.08 | $ 0.05 | |||
Workforce reductions | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Total before income taxes | $ 15 | $ 2 | $ 17 | $ 7 | (13) | 21 | 172 |
Plant closing and other | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Total before income taxes | $ 15 | $ 8 | $ 22 | $ 21 | $ 47 | $ 57 | $ 42 |
RESTRUCTURING CHARGES - Restr_2
RESTRUCTURING CHARGES - Restructuring Program Charges Related to Segments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | $ 29 | $ 10 | $ 39 | $ 28 | $ 33 | $ 78 | $ 214 |
Operating segments | Electrical Americas | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 1 | 5 | 3 | 10 | |||
Operating segments | Electrical Global | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 14 | 1 | 18 | 6 | |||
Operating segments | Aerospace | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 2 | 2 | 3 | 5 | |||
Operating segments | Vehicle | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 1 | 3 | 3 | 6 | |||
Operating segments | eMobility | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 6 | 0 | 7 | 0 | |||
Corporate | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | $ 5 | $ 0 | $ 6 | $ 2 |
RESTRUCTURING CHARGES - Liabili
RESTRUCTURING CHARGES - Liabilities Related to Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring Reserve [Roll Forward] | |||||||
Balance at beginning of period | $ 41 | $ 104 | $ 104 | $ 142 | $ 0 | ||
Liability recognized, net | $ 29 | $ 10 | 39 | 28 | 33 | 78 | 214 |
Payments, utilization and translation | (30) | (96) | (116) | (72) | |||
Balance at end of period | 51 | 51 | 41 | 104 | 142 | ||
Restructuring Reserve, Accrual Adjustment | 30 | ||||||
Workforce reductions | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Balance at beginning of period | 38 | 96 | 96 | 139 | 0 | ||
Liability recognized, net | 15 | 2 | 17 | 7 | (13) | 21 | 172 |
Payments, utilization and translation | (10) | (45) | (64) | (33) | |||
Balance at end of period | 45 | 45 | 38 | 96 | 139 | ||
Plant closing and other | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Balance at beginning of period | 4 | 8 | 8 | 3 | 0 | ||
Liability recognized, net | 15 | $ 8 | 22 | $ 21 | 47 | 57 | 42 |
Payments, utilization and translation | (20) | (51) | (52) | (39) | |||
Balance at end of period | $ 6 | $ 6 | $ 4 | $ 8 | $ 3 |
BUSINESS SEGMENT INFORMATION (D
BUSINESS SEGMENT INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | $ 5,866 | $ 5,212 | $ 11,349 | $ 10,054 | |||||
Intangible asset amortization expense | (113) | (122) | (237) | (250) | |||||
Interest expense - net | (42) | (31) | (91) | (63) | |||||
Pension and other postretirement benefits income | 11 | 9 | 22 | 28 | |||||
Restructuring program charges | (29) | (10) | (39) | (28) | $ (33) | $ (78) | $ (214) | ||
Other expense - net | (192) | (171) | (340) | (302) | |||||
Income before income taxes | 898 | 720 | 1,660 | 1,339 | |||||
Income tax expense | 153 | 119 | 276 | 205 | |||||
Net income | 745 | $ 639 | 601 | $ 533 | 1,384 | 1,135 | |||
Less net income for noncontrolling interests | (1) | 0 | (3) | (1) | |||||
Net income attributable to Eaton ordinary shareholders | 744 | 601 | 1,382 | 1,133 | |||||
Electrical Americas | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 2,538 | 2,131 | 4,832 | 4,022 | |||||
Electrical Global | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 1,569 | 1,495 | 3,069 | 2,932 | |||||
Aerospace | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 848 | 742 | 1,650 | 1,459 | |||||
Vehicle | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 751 | 708 | 1,490 | 1,379 | |||||
eMobility | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 161 | 136 | 308 | 262 | |||||
Operating segments | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 5,866 | 5,212 | 11,349 | 10,054 | |||||
Segment operating profit (loss) | 1,264 | 1,046 | 2,346 | 1,955 | |||||
Operating segments | Electrical Americas | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 2,538 | 2,131 | 4,832 | 4,022 | |||||
Segment operating profit (loss) | 669 | 495 | 1,194 | 857 | |||||
Restructuring program charges | (1) | (5) | (3) | (10) | |||||
Operating segments | Electrical Global | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 1,569 | 1,495 | 3,069 | 2,932 | |||||
Segment operating profit (loss) | 290 | 282 | 564 | 561 | |||||
Restructuring program charges | (14) | (1) | (18) | (6) | |||||
Operating segments | Aerospace | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 848 | 742 | 1,650 | 1,459 | |||||
Segment operating profit (loss) | 191 | 163 | 371 | 321 | |||||
Restructuring program charges | (2) | (2) | (3) | (5) | |||||
Operating segments | Vehicle | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 751 | 708 | 1,490 | 1,379 | |||||
Segment operating profit (loss) | 115 | 108 | 222 | 221 | |||||
Restructuring program charges | (1) | (3) | (3) | (6) | |||||
Operating segments | eMobility | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Net sales | 161 | 136 | 308 | 262 | |||||
Segment operating profit (loss) | (1) | (2) | (5) | (5) | |||||
Restructuring program charges | (6) | 0 | (7) | 0 | |||||
Corporate | |||||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||||
Restructuring program charges | $ (5) | $ 0 | $ (6) | $ (2) |