Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 29, 2019 | Jul. 12, 2019 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 29, 2019 | |
Document Transition Report | false | |
Entity File Number | 1-5480 | |
Entity Registrant Name | Textron Inc | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 05-0315468 | |
Entity Address, Address Line One | 40 Westminster Street | |
Entity Address, City or Town | Providence | |
Entity Address, State or Province | RI | |
Entity Address, Postal Zip Code | 02903 | |
City Area Code | 401 | |
Local Phone Number | 421-2800 | |
Title of 12(b) Security | Common stock, $0.125 par value | |
Trading Symbol | TXT | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 230,123,580 | |
Entity Central Index Key | 0000217346 | |
Current Fiscal Year End Date | --01-04 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Revenues | ||||
Total revenues | $ 3,227 | $ 3,726 | $ 6,336 | $ 7,022 |
Costs, expenses and other | ||||
Cost of sales | 2,641 | 3,073 | 5,218 | 5,802 |
Selling and administrative expense | 292 | 370 | 599 | 697 |
Interest expense | 43 | 42 | 85 | 83 |
Non-service components of pension and post-retirement income, net | (28) | (19) | (57) | (38) |
Total costs, expenses and other | 2,948 | 3,466 | 5,845 | 6,544 |
Income before income taxes | 279 | 260 | 491 | 478 |
Income tax expense | 62 | 36 | 95 | 65 |
Net income | $ 217 | $ 224 | $ 396 | $ 413 |
Earnings per share | ||||
Basic (in dollars per share) | $ 0.94 | $ 0.88 | $ 1.70 | $ 1.61 |
Diluted (in dollars per share) | $ 0.93 | $ 0.87 | $ 1.69 | $ 1.59 |
Manufacturing | ||||
Revenues | ||||
Total revenues | $ 3,211 | $ 3,709 | $ 6,303 | $ 6,989 |
Finance | ||||
Revenues | ||||
Finance Revenue | $ 16 | $ 17 | $ 33 | $ 33 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Net income | $ 217 | $ 224 | $ 396 | $ 413 |
Other comprehensive income (loss), net of taxes: | ||||
Pension and postretirement benefits adjustments, net of reclassifications | 20 | 31 | 41 | 62 |
Foreign currency translation adjustments | 1 | (69) | 4 | (27) |
Deferred gains (losses) on hedge contracts, net of reclassifications | (4) | 2 | (3) | |
Other comprehensive income (loss) | 21 | (42) | 47 | 32 |
Comprehensive income | $ 238 | $ 182 | $ 443 | $ 445 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Assets | ||
Inventories | $ 4,311 | $ 3,818 |
Finance receivables, net | 776 | 760 |
Total assets | 14,796 | 14,264 |
Liabilities | ||
Total liabilities | 9,460 | 9,072 |
Shareholders' equity | ||
Common stock | 30 | 30 |
Capital surplus | 1,717 | 1,646 |
Treasury stock | (490) | (129) |
Retained earnings | 5,794 | 5,407 |
Accumulated other comprehensive loss | (1,715) | (1,762) |
Total shareholders' equity | 5,336 | 5,192 |
Total liabilities and shareholders' equity | $ 14,796 | $ 14,264 |
Common shares outstanding | 230,058 | 235,621 |
Manufacturing group | ||
Assets | ||
Cash and equivalents | $ 775 | $ 987 |
Accounts receivable, net | 989 | 1,024 |
Inventories | 4,311 | 3,818 |
Other current assets | 839 | 785 |
Total current assets | 6,914 | 6,614 |
Property, plant and equipment, less accumulated depreciation and amortization of $4,317 and $4,203, respectively | 2,517 | 2,615 |
Goodwill | 2,147 | 2,218 |
Other assets | 2,255 | 1,800 |
Total assets | 13,833 | 13,247 |
Liabilities | ||
Short-term debt and current portion of long-term debt | 457 | 258 |
Accounts payable | 1,231 | 1,099 |
Other current liabilities | 1,891 | 2,149 |
Total current liabilities | 3,579 | 3,506 |
Other liabilities | 2,157 | 1,932 |
Long-term debt | 2,910 | 2,808 |
Total liabilities | 8,646 | 8,246 |
Finance group | ||
Assets | ||
Cash and equivalents | 82 | 120 |
Finance receivables, net | 776 | 760 |
Other assets | 105 | 137 |
Total assets | 963 | 1,017 |
Liabilities | ||
Other liabilities | 111 | 108 |
Debt | 703 | 718 |
Total liabilities | $ 814 | $ 826 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Accumulated depreciation and amortization | $ 4,317 | $ 4,203 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities | ||
Net income | $ 396 | $ 413 |
Non-cash items: | ||
Depreciation and amortization | 202 | 216 |
Deferred income taxes | 32 | 12 |
Other, net | 40 | 61 |
Changes in assets and liabilities: | ||
Accounts receivable, net | 36 | (42) |
Inventories | (505) | (78) |
Other assets | (19) | (38) |
Accounts payable | 132 | (22) |
Other liabilities | (338) | (165) |
Income taxes, net | 14 | 17 |
Pension, net | (29) | (5) |
Captive finance receivables, net | (19) | 26 |
Other operating activities, net | (2) | 3 |
Net cash provided by (used in) operating activities of continuing operations | (60) | 398 |
Net cash used in operating activities of discontinued operations | (1) | (1) |
Net cash provided by (used in) operating activities | (61) | 397 |
Cash flows from investing activities | ||
Capital expenditures | (135) | (159) |
Net proceeds from corporate-owned life insurance policies | 4 | 98 |
Finance receivables repaid | 20 | 25 |
Other investing activities, net | 7 | 30 |
Net cash provided by (used in) investing activities | (104) | (6) |
Cash flows from financing activities | ||
Proceeds from long-term debt | 297 | |
Principal payments on long-term debt and nonrecourse debt | (35) | (34) |
Purchases of Textron common stock | (361) | (915) |
Dividends paid | (9) | (10) |
Other financing activities, net | 19 | 43 |
Net cash used in financing activities | (89) | (916) |
Effect of exchange rate changes on cash and equivalents | 4 | (6) |
Net decrease in cash and equivalents | (250) | (531) |
Cash and equivalents at beginning of period | 1,107 | 1,262 |
Cash and equivalents at end of period | 857 | 731 |
Manufacturing group | ||
Cash flows from operating activities | ||
Net income | 387 | 398 |
Non-cash items: | ||
Depreciation and amortization | 199 | 212 |
Deferred income taxes | 33 | 14 |
Other, net | 39 | 60 |
Changes in assets and liabilities: | ||
Accounts receivable, net | 36 | (42) |
Inventories | (532) | (80) |
Other assets | (17) | (39) |
Accounts payable | 132 | (22) |
Other liabilities | (339) | (162) |
Income taxes, net | 10 | 28 |
Pension, net | (29) | (5) |
Dividends received from Finance group | 50 | 50 |
Other operating activities, net | (2) | 3 |
Net cash provided by (used in) operating activities of continuing operations | (33) | 415 |
Net cash used in operating activities of discontinued operations | (1) | (1) |
Net cash provided by (used in) operating activities | (34) | 414 |
Cash flows from investing activities | ||
Capital expenditures | (135) | (159) |
Net proceeds from corporate-owned life insurance policies | 4 | 98 |
Other investing activities, net | 4 | 10 |
Net cash provided by (used in) investing activities | (127) | (51) |
Cash flows from financing activities | ||
Proceeds from long-term debt | 297 | |
Principal payments on long-term debt and nonrecourse debt | (1) | |
Purchases of Textron common stock | (361) | (915) |
Dividends paid | (9) | (10) |
Other financing activities, net | 19 | 43 |
Net cash used in financing activities | (55) | (882) |
Effect of exchange rate changes on cash and equivalents | 4 | (6) |
Net decrease in cash and equivalents | (212) | (525) |
Cash and equivalents at beginning of period | 987 | 1,079 |
Cash and equivalents at end of period | 775 | 554 |
Finance group | ||
Cash flows from operating activities | ||
Net income | 9 | 15 |
Non-cash items: | ||
Depreciation and amortization | 3 | 4 |
Deferred income taxes | (1) | (2) |
Other, net | 1 | 1 |
Changes in assets and liabilities: | ||
Other assets | (2) | 1 |
Other liabilities | 1 | (3) |
Income taxes, net | 4 | (11) |
Net cash provided by (used in) operating activities of continuing operations | 15 | 5 |
Net cash provided by (used in) operating activities | 15 | 5 |
Cash flows from investing activities | ||
Finance receivables repaid | 91 | 112 |
Finance receivables originated | (90) | (61) |
Other investing activities, net | 30 | 22 |
Net cash provided by (used in) investing activities | 31 | 73 |
Cash flows from financing activities | ||
Principal payments on long-term debt and nonrecourse debt | (34) | (34) |
Dividends paid | (50) | (50) |
Net cash used in financing activities | (84) | (84) |
Net decrease in cash and equivalents | (38) | (6) |
Cash and equivalents at beginning of period | 120 | 183 |
Cash and equivalents at end of period | $ 82 | $ 177 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 29, 2019 | |
Basis of Presentation | Note 1. Basis of Presentation ​ Our Consolidated Financial Statements include the accounts of Textron Inc. (Textron) and its majority-owned subsidiaries. We have prepared these unaudited consolidated financial statements in accordance with accounting principles generally accepted in the U.S. for interim financial information. Accordingly, these interim financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the U.S. for complete financial statements. The consolidated interim financial statements included in this quarterly report should be read in conjunction with the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 29, 2018. In the opinion of management, the interim financial statements reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for the fair presentation of our consolidated financial position, results of operations and cash flows for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. ​ Our financings are conducted through two separate borrowing groups. The Manufacturing group consists of Textron consolidated with its majority-owned subsidiaries that operate in the Textron Aviation, Bell, Textron Systems and Industrial segments. The Finance group, which also is the Finance segment, consists of Textron Financial Corporation and its consolidated subsidiaries. We designed this framework to enhance our borrowing power by separating the Finance group. Our Manufacturing group operations include the development, production and delivery of tangible goods and services, while our Finance group provides financial services. Due to the fundamental differences between each borrowing group’s activities, investors, rating agencies and analysts use different measures to evaluate each group’s performance. To support those evaluations, we present balance sheet and cash flow information for each borrowing group within the Consolidated Financial Statements. All significant intercompany transactions are eliminated from the Consolidated Financial Statements, including retail financing activities for inventory sold by our Manufacturing group and financed by our Finance group. ​ Use of Estimates We prepare our financial statements in conformity with generally accepted accounting principles, which require us to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Our estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the Consolidated Statements of Operations in the period that they are determined. ​ Contract Estimates For contracts where revenue is recognized over time, we recognize changes in estimated contract revenues, costs and profits using the cumulative catch-up method of accounting. This method recognizes the cumulative effect of changes on current and prior periods with the impact of the change from inception-to-date recorded in the current period. Anticipated losses on contracts are recognized in full in the period in which the losses become probable and estimable. ​ In the second quarter of 2019 and 2018, our cumulative catch-up adjustments increased revenue and segment profit by $27 million and $64 million, respectively, and net income by $21 million and $49 million, respectively ($0.09 and $0.19 per diluted share, respectively). In the second quarter of 2019 and 2018, gross favorable adjustments totaled $46 million and $70 million, respectively, and the gross unfavorable adjustments totaled $19 million and $6 million, respectively. ​ In the first half of 2019 and 2018, our cumulative catch-up adjustments increased revenue and segment profit by $58 million and $104 million, respectively, and net income by $44 million and $79 million, respectively ($0.19 and $0.30 per diluted share, respectively). In the first half of 2019 and 2018, gross favorable adjustments totaled $99 million and $126 million, respectively, and the gross unfavorable adjustments totaled $41 million and $22 million, respectively. ​ |
Summary of Significant Accounti
Summary of Significant Accounting Policies Update | 6 Months Ended |
Jun. 29, 2019 | |
Summary of Significant Accounting Policies Update | Note 2. Summary of Significant Accounting Policies Update ​ At the beginning of 2019, we adopted Accounting Standards Update (ASU) No. 2016-02, Leases . ​ Our significant accounting policies are included in Note 1 of our Annual Report on Form 10-K for the year ended December 29, 2018. Significant changes to our policies resulting from the adoption of ASC 842 are provided below. ​ Leases We identify leases by evaluating our contracts to determine if the contract conveys the right to use an identified asset for a stated period of time in exchange for consideration. Specifically, we consider whether we can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the asset. For our contracts that contain both lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs, other goods/services), we allocate the consideration in the contract to each component based on its standalone price. Leases with terms greater than 12 months are classified as either operating or finance leases at the commencement date. For these leases, we capitalize the lesser of a) the present value of the minimum lease payments over the lease term, or b) the fair value of the asset, as a right-of-use asset with an offsetting lease liability. The discount rate used to calculate the present value of the minimum lease payments is typically our incremental borrowing rate, as the rate implicit in the lease is generally not known or determinable. The lease term includes any noncancelable period for which we have the right to use the asset and may include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating leases are recognized as a single lease cost on a straight-line basis over the lease term, while finance lease cost is recognized separately as amortization and interest expense. ​ Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses. ​ |
Accounts Receivable and Finance
Accounts Receivable and Finance Receivables | 6 Months Ended |
Jun. 29, 2019 | |
Accounts Receivable and Finance Receivables | Note 3. Accounts Receivable and Finance Receivables ​ Accounts Receivable Accounts receivable is composed of the following: ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Commercial $ 874 $ 885 U.S. Government contracts ​ 142 166 ​ ​ 1,016 1,051 Allowance for doubtful accounts ​ (27) (27) Total accounts receivable, net $ 989 $ 1,024 ​ Finance Receivables Finance receivables are presented in the following table: ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables $ 802 $ 789 Allowance for losses ​ (26) (29) Total finance receivables, net $ 776 $ 760 ​ Finance Receivable Portfolio Quality We internally assess the quality of our finance receivables based on a number of key credit quality indicators and statistics such as delinquency, loan balance to estimated collateral value and the financial strength of individual borrowers and guarantors. Because many of these indicators are difficult to apply across an entire class of receivables, we evaluate individual loans on a quarterly basis and classify these loans into three categories based on the key credit quality indicators for the individual loan. These three categories are performing, watchlist and nonaccrual. ​ We classify finance receivables as nonaccrual if credit quality indicators suggest full collection of principal and interest is doubtful. In addition, we automatically classify accounts as nonaccrual once they are contractually delinquent by more than three months unless collection of principal and interest is not doubtful. Accounts are classified as watchlist when credit quality indicators have deteriorated as compared with typical underwriting criteria, and we believe collection of full principal and interest is probable but not certain. All other finance receivables that do not meet the watchlist or nonaccrual categories are classified as performing. ​ We measure delinquency based on the contractual payment terms of our finance receivables. In determining the delinquency aging category of an account, any/all principal and interest received is applied to the most past-due principal and/or interest amounts due. If a significant portion of the contractually due payment is delinquent, the entire finance receivable balance is reported in accordance with the most past-due delinquency aging category. ​ Finance receivables categorized based on the credit quality indicators and by the delinquency aging category are summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (Dollars in millions) 2019 2018 Performing $ 732 $ 704 Watchlist ​ 39 45 Nonaccrual ​ 31 40 Nonaccrual as a percentage of finance receivables ​ 3.87 % ​ 5.07 % Less than 31 days past due $ 726 $ 719 31-60 days past due ​ 64 ​ 56 61-90 days past due ​ 3 ​ 5 Over 90 days past due ​ 9 ​ 9 60+ days contractual delinquency as a percentage of finance receivables ​ 1.50 % ​ 1.77 % ​ On a quarterly basis, we evaluate individual larger balance accounts for impairment. A finance receivable is considered impaired when it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement based on our review of the credit quality indicators described above. Impaired finance receivables include both nonaccrual accounts and accounts for which full collection of principal and interest remains probable, but the account’s original terms have been, or are expected to be, significantly modified. If the modification specifies an interest rate equal to or greater than a market rate for a finance receivable with comparable risk, the account is not considered impaired in years subsequent to the modification. ​ A summary of finance receivables and the allowance for losses, based on the results of our impairment evaluation, is provided below. The finance receivables included in this table specifically exclude leveraged leases in accordance with U.S. generally accepted accounting principles. ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables evaluated collectively $ 669 $ 630 Finance receivables evaluated individually 31 58 Allowance for losses based on collective evaluation ​ 24 ​ 24 Allowance for losses based on individual evaluation 2 5 Impaired finance receivables with no related allowance for losses $ 23 $ 43 Impaired finance receivables with related allowance for losses ​ 8 ​ 15 Unpaid principal balance of impaired finance receivables ​ 41 ​ 67 Average recorded investment of impaired finance receivables ​ 40 ​ 61 ​ |
Inventories
Inventories | 6 Months Ended |
Jun. 29, 2019 | |
Inventories | Note 4. Inventories ​ Inventories are composed of the following: ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finished goods $ 1,743 $ 1,662 Work in process ​ 1,771 1,356 Raw materials and components ​ 797 800 Total inventories $ 4,311 $ 3,818 ​ |
Other Assets
Other Assets | 6 Months Ended |
Jun. 29, 2019 | |
Other Assets | |
Other Assets | Note 5. Other Assets ​ On April 1, 2019, TRU Simulation + Training Inc., a business within our Textron Systems segment, contributed assets associated with its training business into FlightSafety Textron Aviation Training LLC, a company formed by FlightSafety International Inc. and TRU to provide training solutions for Textron Aviation’s commercial business and general aviation aircraft. We have a 30% interest in this newly formed company and our investment is accounted for under the equity method of accounting. We contributed assets with a carrying value of $69 million to the company, which primarily included property, plant and equipment. In addition, $71 million of the Textron Systems segment's goodwill was allocated to this transaction. In the second quarter of 2019, based on the fair value of our share of the business, we recorded a pre-tax net gain of $18 million, subject to post-closing adjustments, to cost of sales in our Consolidated Statements of Operations. ​ |
Warranty Liability
Warranty Liability | 6 Months Ended |
Jun. 29, 2019 | |
Warranty Liability | |
Warranty Liability | Note 6. Warranty Liability ​ Changes in our warranty liability are as follows: ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ June 29, June 30, (In millions) 2019 2018 Beginning of period $ 149 $ 164 Provision 30 34 Settlements (38) (39) Adjustments* (5) 7 End of period $ 136 $ 166 * Adjustments include changes to prior year estimates, new issues on prior year sales, business dispositions, acquisitions and currency translation adjustments. ​ |
Leases
Leases | 6 Months Ended |
Jun. 29, 2019 | |
Leases | |
Leases | Note 7. Leases ​ We primarily lease certain manufacturing plants, offices, warehouses, training and service centers at various locations worldwide that are classified as either operating or finance leases. Our leases have remaining lease terms up to 30 years, which include options to extend the lease term for periods up to 25 years when it is reasonably certain the option will be exercised. In the second quarter and first half of 2019, our operating lease cost totaled $16 million and $32 million, respectively. Our finance lease cost and our variable and short-term lease costs were not significant. In the first half of 2019, cash paid for operating lease liabilities totaled $32 million, which is classified in cash flows from operating activities. Balance sheet and other information related to our leases is as follows: ​ ​ ​ ​ ​ ​ June 29, (Dollars in millions) 2019 Operating leases: ​ ​ Other assets $ 298 Other current liabilities 53 Other liabilities 247 Finance leases: ​ Property, plant and equipment, less accumulated amortization of $51 million $ 116 Short-term and current portion of long-term debt 6 Long-term debt 77 Weighted-average remaining lease term (in years) ​ Finance leases 14.1 Operating leases 10.3 Weighted-average discount rate ​ Finance leases 2.73 % Operating leases 4.46 % ​ Maturities of our lease liabilities at June 29, 2019 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ Operating Finance (In millions) Leases Leases 2019 $ 34 $ 5 2020 57 9 2021 43 9 2022 37 9 2023 31 9 Thereafter 179 69 Total lease payments 381 110 Less: interest (81) (27) Total lease liabilities $ 300 $ 83 ​ ​ |
Debt
Debt | 6 Months Ended |
Jun. 29, 2019 | |
Debt | Note 8. Debt ​ Under our shelf registration statement, on May 7, 2019, we issued $300 million of fixed-rate notes due September 17, 2029 with an annual interest rate of 3.90%. The net proceeds of the issuance totaled $297 million, after deducting underwriting discounts, commissions and offering expenses. ​ On June 24, 2019, the Finance Group's $150 million fixed-rate loan due August 16, 2019 was amended. The maturity date of this loan was extended to June 23, 2022 and the annual interest rate was modified from 2.26% to 2.88%. ​ |
Derivative Instruments and Fair
Derivative Instruments and Fair Value Measurements | 6 Months Ended |
Jun. 29, 2019 | |
Derivative Instruments and Fair Value Measurements | Note 9. Derivative Instruments and Fair Value Measurements ​ We measure fair value at the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We prioritize the assumptions that market participants would use in pricing the asset or liability into a three-tier fair value hierarchy. This fair value hierarchy gives the highest priority (Level 1) to quoted prices in active markets for identical assets or liabilities and the lowest priority (Level 3) to unobservable inputs in which little or no market data exist, requiring companies to develop their own assumptions. Observable inputs that do not meet the criteria of Level 1, which include quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets and liabilities in markets that are not active, are categorized as Level 2. Level 3 inputs are those that reflect our estimates about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. Valuation techniques for assets and liabilities measured using Level 3 inputs may include methodologies such as the market approach, the income approach or the cost approach and may use unobservable inputs such as projections, estimates and management’s interpretation of current market data. These unobservable inputs are utilized only to the extent that observable inputs are not available or cost effective to obtain. ​ Assets and Liabilities Recorded at Fair Value on a Recurring Basis We manufacture and sell our products in a number of countries throughout the world, and, therefore, we are exposed to movements in foreign currency exchange rates. We primarily utilize foreign currency exchange contracts with maturities of no more than three years to manage this volatility. These contracts qualify as cash flow hedges and are intended to offset the effect of exchange rate fluctuations on forecasted sales, inventory purchases and overhead expenses. Net gains and losses recognized in earnings and Accumulated other comprehensive loss on cash flow hedges, including gains and losses related to hedge ineffectiveness, were not significant in the periods presented. ​ Our foreign currency exchange contracts are measured at fair value using the market method valuation technique. The inputs to this technique utilize current foreign currency exchange forward market rates published by third-party leading financial news and data providers. These are observable data that represent the rates that the financial institution uses for contracts entered into at that date; however, they are not based on actual transactions so they are classified as Level 2. At June 29, 2019 and December 29, 2018, we had foreign currency exchange contracts with notional amounts upon which the contracts were based of $395 million and $379 million, respectively. At June 29, 2019, the fair value amounts of our foreign currency exchange contracts were a $2 million asset and a $3 million liability. At December 29, 2018, the fair value amounts of our foreign currency exchange contracts were a $2 million asset and a $10 million liability. ​ We hedge our net investment position in certain major currencies and generate foreign currency interest payments that offset other transactional exposures in these currencies. To accomplish this, we borrow directly in the foreign currency and designate a portion of the debt as a hedge of the net investment. We record changes in the fair value of these contracts in other comprehensive income to the extent they are effective as cash flow hedges. Currency effects on the effective portion of these hedges, which are reflected in the foreign currency translation adjustments within Accumulated other comprehensive loss, were not significant in the periods presented. ​ Assets and Liabilities Not Recorded at Fair Value The carrying value and estimated fair value of our financial instruments that are not reflected in the financial statements at fair value are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 December 29, 2018 ​ Carrying Estimated Carrying Estimated (In millions) Value Fair Value Value Fair Value Manufacturing group ​ ​ ​ ​ ​ ​ ​ ​ Debt, excluding leases $ (3,301) $ (3,414) $ (2,996) $ (2,971) Finance group ​ ​ ​ ​ ​ ​ ​ ​ Finance receivables, excluding leases 589 615 582 584 Debt (703) (640) (718) (640) ​ Fair value for the Manufacturing group debt is determined using market observable data for similar transactions (Level 2). The fair value for the Finance group debt was determined primarily based on discounted cash flow analyses using observable market inputs from debt with similar duration, subordination and credit default expectations (Level 2). Fair value estimates for finance receivables were determined based on internally developed discounted cash flow models primarily utilizing significant unobservable inputs (Level 3), which include estimates of the rate of return, financing cost, capital structure and/or discount rate expectations of current market participants combined with estimated loan cash flows based on credit losses, payment rates and expectations of borrowers’ ability to make payments on a timely basis. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 29, 2019 | |
Shareholders' Equity | Note 10. Shareholders’ Equity ​ A reconciliation of Shareholders’ equity is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Total ​ Common Capital Treasury Retained Comprehensive Shareholders’ (In millions) Stock Surplus Stock Earnings Loss Equity Three months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,689 $ (331) $ 5,581 $ (1,736) $ 5,233 Net income ​ — ​ — ​ — ​ 217 ​ — ​ 217 Other comprehensive income ​ — ​ — ​ — ​ — ​ 21 ​ 21 Share-based compensation activity ​ — ​ 28 ​ — ​ — ​ — ​ 28 Dividends declared ​ — ​ — ​ — ​ (4) ​ — ​ (4) Purchases of common stock ​ — ​ — ​ (159) ​ — ​ — ​ (159) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,710 $ (392) $ 5,642 $ (1,301) $ 5,692 Net income — — — 224 — 224 Other comprehensive (loss) — — — — (42) (42) Share-based compensation activity — 64 — — — 64 Dividends declared — — — (5) — (5) Purchases of common stock — — (571) — — (571) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,646 $ (129) $ 5,407 $ (1,762) $ 5,192 Net income ​ — ​ — ​ — ​ 396 ​ — ​ 396 Other comprehensive income ​ — ​ — ​ — ​ — ​ 47 ​ 47 Share-based compensation activity ​ — ​ 71 ​ — ​ — ​ — ​ 71 Dividends declared ​ — ​ — ​ — ​ (9) ​ — ​ (9) Purchases of common stock ​ — ​ — ​ (361) ​ — ​ — ​ (361) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,669 $ (48) $ 5,368 $ (1,375) $ 5,647 Adoption of ASC 606 — — — 90 — 90 Net income — — — 413 — 413 Other comprehensive income — — — — 32 32 Share-based compensation activity — 105 — — — 105 Dividends declared — — — (10) — (10) Purchases of common stock — — (915) — — (915) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 ​ Dividends per share of common stock were $0.02 for both the second quarter of 2019 and 2018 and $0.04 for both the first half of 2019 and 2018. ​ Earnings Per Share We calculate basic and diluted earnings per share (EPS) based on net income, which approximates income available to common shareholders for each period. Basic EPS is calculated using the two-class method, which includes the weighted-average number of common shares outstanding during the period and restricted stock units to be paid in stock that are deemed participating securities as they provide nonforfeitable rights to dividends. Diluted EPS considers the dilutive effect of all potential future common stock, including stock options. ​ The weighted-average shares outstanding for basic and diluted EPS are as follows: ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In thousands) 2019 2018 2019 2018 Basic weighted-average shares outstanding 232,013 253,904 233,426 257,200 Dilutive effect of stock options 1,532 3,273 1,567 3,262 Diluted weighted-average shares outstanding 233,545 257,177 234,993 260,462 ​ Stock options to purchase 3.1 million shares of common stock were excluded from the calculation of diluted weighted-average shares outstanding for both the second quarter and first half of 2019, as their effect would have been anti-dilutive. Stock options to purchase 1.3 million shares of common stock were excluded from the calculation of diluted weighted-average shares outstanding for both the second quarter and first half of 2018, as their effect would have been anti-dilutive. ​ Accumulated Other Comprehensive Loss and Other Comprehensive Income The components of Accumulated other comprehensive loss are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and Foreign Deferred Accumulated ​ Postretirement Currency Gains (Losses) Other ​ Benefits Translation on Hedge Comprehensive (In millions) Adjustments Adjustments Contracts Loss Balance at December 29, 2018 $ (1,727) $ (32) $ (3) $ (1,762) Other comprehensive income before reclassifications ​ — ​ 4 ​ 4 ​ 8 Reclassified from Accumulated other comprehensive loss ​ 41 ​ — ​ (2) ​ 39 Balance at June 29, 2019 $ (1,686) $ (28) $ (1) $ (1,715) Balance at December 30, 2017 $ (1,396) $ 11 $ 10 $ (1,375) Other comprehensive income before reclassifications — (27) (2) (29) Reclassified from Accumulated other comprehensive loss 62 — (1) 61 Balance at June 30, 2018 $ (1,334) $ (16) $ 7 $ (1,343) ​ The before and after-tax components of Other comprehensive income (loss) are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 June 30, 2018 ​ ​ ​ Tax ​ ​ ​ Tax ​ ​ Pre-Tax (Expense) After-Tax Pre-Tax (Expense) After-Tax (In millions) Amount Benefit Amount Amount Benefit Amount Three Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 24 $ (6) $ 18 $ 39 $ (9) $ 30 Amortization of prior service cost* 3 (1) 2 ​ 2 ​ (1) ​ 1 Pension and postretirement benefits adjustments, net 27 (7) 20 ​ 41 ​ (10) ​ 31 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 2 (1) 1 ​ (4) ​ 1 ​ (3) Reclassification adjustments (1) — (1) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net ​ 1 ​ (1) ​ — ​ (5) ​ 1 ​ (4) Foreign currency translation adjustments ​ 3 ​ (2) ​ 1 ​ (66) ​ (3) ​ (69) Total $ 31 $ (10) $ 21 $ (30) $ (12) $ (42) Six Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 49 $ (11) $ 38 $ 77 $ (18) $ 59 Amortization of prior service cost* 4 (1) 3 ​ 4 ​ (1) ​ 3 Pension and postretirement benefits adjustments, net 53 (12) 41 ​ 81 ​ (19) ​ 62 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 6 (2) 4 ​ (2) ​ — ​ (2) Reclassification adjustments (2) — (2) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net 4 (2) 2 ​ (3) ​ — ​ (3) Foreign currency translation adjustments 4 — 4 ​ (26) ​ (1) ​ (27) Total $ 61 $ (14) $ 47 $ 52 $ (20) $ 32 *These components of other comprehensive income are included in the computation of net periodic pension cost. See Note 14 of our 2018 Annual Report on Form 10-K for additional information. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 29, 2019 | |
Segment Information | Note 11. Segment Information ​ We operate in, and report financial information for, the following five business segments: Textron Aviation, Bell, Textron Systems, Industrial and Finance. On July 2, 2018, we sold our Tools and Test Equipment businesses that were previously included in the Industrial segment as discussed in Note 2 of our 2018 Annual Report on Form 10-K. Segment profit is an important measure used for evaluating performance and for decision-making purposes. Segment profit for the manufacturing segments excludes interest expense, certain corporate expenses, gains/losses on major business dispositions and special charges. The measurement for the Finance segment includes interest income and expense along with intercompany interest income and expense. ​ Our revenues by segment, along with a reconciliation of segment profit to income before income taxes, are included in the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Revenues ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 1,123 $ 1,276 $ 2,257 $ 2,286 Bell ​ 771 831 ​ 1,510 ​ 1,583 Textron Systems ​ 308 380 ​ 615 ​ 767 Industrial ​ 1,009 1,222 ​ 1,921 ​ 2,353 Finance ​ 16 17 ​ 33 ​ 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 Segment Profit ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 105 $ 104 $ 211 $ 176 Bell ​ 103 117 ​ 207 ​ 204 Textron Systems ​ 49 40 ​ 77 ​ 90 Industrial ​ 76 80 ​ 126 ​ 144 Finance ​ 6 5 ​ 12 ​ 11 Segment profit ​ 339 346 ​ 633 ​ 625 Corporate expenses and other, net ​ (24) (51) (71) ​ (78) Interest expense, net for Manufacturing group (36) (35) (71) ​ (69) Income before income taxes $ 279 $ 260 $ 491 $ 478 ​ |
Revenues
Revenues | 6 Months Ended |
Jun. 29, 2019 | |
Revenues | Note 12. Revenues ​ Disaggregation of Revenues Our revenues disaggregated by major product type are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Aircraft $ 733 $ 877 $ 1,499 $ 1,511 Aftermarket parts and services ​ 390 399 ​ 758 775 Textron Aviation ​ 1,123 1,276 ​ 2,257 2,286 Military aircraft and support programs ​ 482 533 ​ 990 1,020 Commercial helicopters, parts and services ​ 289 298 ​ 520 563 Bell ​ 771 831 ​ 1,510 1,583 Unmanned systems ​ 135 161 ​ 269 331 Marine and land systems ​ 60 69 ​ 108 161 Simulation, training and other ​ 113 150 ​ 238 275 Textron Systems ​ 308 380 ​ 615 767 Fuel systems and functional components ​ 592 627 ​ 1,186 1,282 Specialized vehicles ​ 417 475 ​ 735 823 Tools and test equipment ​ — 120 ​ — 248 Industrial ​ 1,009 1,222 ​ 1,921 2,353 Finance ​ 16 17 ​ 33 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 ​ Our revenues for our segments by customer type and geographic location are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions) Textron Bell Textron Industrial Finance Total Three months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,077 $ 279 $ 83 $ 1,004 $ 16 $ 2,459 U.S. Government ​ 46 ​ 492 ​ 225 ​ 5 ​ — ​ 768 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 736 $ 571 $ 249 $ 466 $ 7 $ 2,029 Europe ​ 164 ​ 47 ​ 17 ​ 291 ​ — ​ 519 Asia and Australia ​ 65 ​ 79 ​ 13 ​ 84 ​ 2 ​ 243 Other international ​ 158 ​ 74 ​ 29 ​ 168 ​ 7 ​ 436 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,191 $ 291 $ 107 $ 1,215 $ 17 $ 2,821 U.S. Government 85 540 273 7 — 905 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 914 $ 543 $ 297 $ 590 $ 7 $ 2,351 Europe ​ 128 ​ 50 ​ 23 ​ 372 ​ 2 ​ 575 Asia and Australia ​ 64 ​ 150 ​ 28 ​ 100 ​ 2 ​ 344 Other international 170 88 32 160 6 456 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,169 $ 509 $ 157 $ 1,909 $ 33 $ 4,777 U.S. Government ​ 88 ​ 1,001 ​ 458 ​ 12 ​ — ​ 1,559 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 1,525 $ 1,149 $ 506 $ 855 $ 15 $ 4,050 Europe ​ 347 ​ 67 ​ 40 ​ 602 ​ 1 ​ 1,057 Asia and Australia ​ 88 ​ 161 ​ 29 ​ 161 ​ 3 ​ 442 Other international ​ 297 ​ 133 ​ 40 ​ 303 ​ 14 ​ 787 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,164 $ 543 $ 234 $ 2,339 $ 33 $ 5,313 U.S. Government 122 1,040 533 14 — 1,709 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 1,579 $ 1,052 $ 584 $ 1,086 $ 14 $ 4,315 Europe ​ 274 ​ 77 ​ 35 ​ 755 ​ 3 ​ 1,144 Asia and Australia ​ 145 ​ 277 ​ 56 ​ 192 ​ 4 ​ 674 Other international 288 177 92 320 12 889 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 ​ Remaining Performance Obligations Our remaining performance obligations, which is the equivalent of our backlog, represent the expected transaction price allocated to our contracts that we expect to recognize as revenues in future periods when we perform under the contracts. These remaining obligations exclude unexercised contract options and potential orders under ordering-type contracts such as Indefinite Delivery, Indefinite Quantity contracts. At June 29, 2019, we had $9.3 billion in remaining performance obligations of which we expect to recognize revenues of approximately 68% through 2020, an additional 26% through 2022, and the balance thereafter. ​ Contract Assets and Liabilities Assets and liabilities related to our contracts with customers are reported on a contract-by-contract basis at the end of each reporting period. At June 29, 2019, contract assets and contract liabilities totaled $499 million and $897 million, respectively. At December 29, 2018, contract assets and contract liabilities totaled $461 million and $974 million, respectively. During the second quarter and first half of 2019, we recognized revenues of $146 million and $457 million, respectively, that were included in the contract liability balance at December 29, 2018. We recognized revenues of $377 million and $699 million in the second quarter and first half of 2018 that were included in the contract liability balance at December 31, 2017. |
Retirement Plans
Retirement Plans | 6 Months Ended |
Jun. 29, 2019 | |
Retirement Plans | Note 13. Retirement Plans ​ We provide defined benefit pension plans and other postretirement benefits to eligible employees. The components of net periodic benefit cost (credit) for these plans are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Pension Benefits ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ 22 $ 27 $ 45 $ 53 Interest cost ​ 81 ​ 76 ​ 163 ​ 153 Expected return on plan assets ​ (139) (139) ​ (278) (277) Amortization of net actuarial loss ​ 25 ​ 39 ​ 50 ​ 77 Amortization of prior service cost ​ 4 3 ​ 7 7 Net periodic benefit cost (credit) $ (7) $ 6 $ (13) $ 13 Postretirement Benefits Other Than Pensions ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ — $ — $ 1 $ 1 Interest cost ​ 3 ​ 3 ​ 5 ​ 5 Amortization of net actuarial loss ​ (1) ​ — ​ (1) ​ — Amortization of prior service credit ​ (1) ​ (1) ​ (3) ​ (3) Net periodic benefit cost $ 1 $ 2 $ 2 $ 3 ​ |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 29, 2019 | |
Income Taxes | Note 14. Income Taxes ​ Our effective tax rate for the second quarter and first half of 2019 was 22.2% and 19.3%, respectively. In the first half of 2019, the effective tax rate was lower than the U.S. federal statutory tax rate of 21%, primarily due to a $12 million benefit recognized for additional research credits related to prior years. ​ Our effective tax rate for the second quarter and first half of 2018 was 13.8% and 13.6%, respectively. In the second quarter and first half of 2018, the effective tax rate was lower than the U.S. federal statutory tax rate of 21%, primarily due to a $25 million benefit recognized upon the reassessment of our reserve for uncertain tax positions based on new information, including interactions with the tax authorities and recent audit settlements. The effective tax rate for the first half of 2018 also reflects benefits recognized from audit settlements in the first quarter of 2018. ​ Our reserve for unrecognized tax benefits totaled $175 million and $141 million at June 29, 2019 and December 29, 2018, respectively. The increase in this reserve largely reflects a claim filed in the first quarter of 2019 for tax credits related to prior years. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 29, 2019 | |
Commitments and Contingencies | Note 15. Commitments and Contingencies ​ We are subject to legal proceedings and other claims arising out of the conduct of our business, including proceedings and claims relating to commercial and financial transactions; government contracts; alleged lack of compliance with applicable laws and regulations; production partners; product liability; patent and trademark infringement; employment disputes; and environmental, safety and health matters. Some of these legal proceedings and claims seek damages, fines or penalties in substantial amounts or remediation of environmental contamination. As a government contractor, we are subject to audits, reviews and investigations to determine whether our operations are being conducted in accordance with applicable regulatory requirements. Under federal government procurement regulations, certain claims brought by the U.S. Government could result in our suspension or debarment from U.S. Government contracting for a period of time. On the basis of information presently available, we do not believe that existing proceedings and claims will have a material effect on our financial position or results of operations. ​ |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies Update (Policies) | 6 Months Ended |
Jun. 29, 2019 | |
Leases | ​ Leases We identify leases by evaluating our contracts to determine if the contract conveys the right to use an identified asset for a stated period of time in exchange for consideration. Specifically, we consider whether we can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the asset. For our contracts that contain both lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs, other goods/services), we allocate the consideration in the contract to each component based on its standalone price. Leases with terms greater than 12 months are classified as either operating or finance leases at the commencement date. For these leases, we capitalize the lesser of a) the present value of the minimum lease payments over the lease term, or b) the fair value of the asset, as a right-of-use asset with an offsetting lease liability. The discount rate used to calculate the present value of the minimum lease payments is typically our incremental borrowing rate, as the rate implicit in the lease is generally not known or determinable. The lease term includes any noncancelable period for which we have the right to use the asset and may include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating leases are recognized as a single lease cost on a straight-line basis over the lease term, while finance lease cost is recognized separately as amortization and interest expense. ​ |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses. |
Accounts Receivable and Finan_2
Accounts Receivable and Finance Receivables (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Accounts receivable | ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Commercial $ 874 $ 885 U.S. Government contracts ​ 142 166 ​ ​ 1,016 1,051 Allowance for doubtful accounts ​ (27) (27) Total accounts receivable, net $ 989 $ 1,024 |
Finance receivables | ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables $ 802 $ 789 Allowance for losses ​ (26) (29) Total finance receivables, net $ 776 $ 760 |
Finance receivables by credit quality indicator and by delinquency aging category | ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (Dollars in millions) 2019 2018 Performing $ 732 $ 704 Watchlist ​ 39 45 Nonaccrual ​ 31 40 Nonaccrual as a percentage of finance receivables ​ 3.87 % ​ 5.07 % Less than 31 days past due $ 726 $ 719 31-60 days past due ​ 64 ​ 56 61-90 days past due ​ 3 ​ 5 Over 90 days past due ​ 9 ​ 9 60+ days contractual delinquency as a percentage of finance receivables ​ 1.50 % ​ 1.77 % |
Summary of finance receivables and allowance for loan losses based on impairment evaluation, excluding leveraged leases | ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables evaluated collectively $ 669 $ 630 Finance receivables evaluated individually 31 58 Allowance for losses based on collective evaluation ​ 24 ​ 24 Allowance for losses based on individual evaluation 2 5 Impaired finance receivables with no related allowance for losses $ 23 $ 43 Impaired finance receivables with related allowance for losses ​ 8 ​ 15 Unpaid principal balance of impaired finance receivables ​ 41 ​ 67 Average recorded investment of impaired finance receivables ​ 40 ​ 61 ​ |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Inventories | ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finished goods $ 1,743 $ 1,662 Work in process ​ 1,771 1,356 Raw materials and components ​ 797 800 Total inventories $ 4,311 $ 3,818 ​ |
Warranty Liability (Tables)
Warranty Liability (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Warranty Liability | |
Changes in warranty liability | ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ June 29, June 30, (In millions) 2019 2018 Beginning of period $ 149 $ 164 Provision 30 34 Settlements (38) (39) Adjustments* (5) 7 End of period $ 136 $ 166 * Adjustments include changes to prior year estimates, new issues on prior year sales, business dispositions, acquisitions and currency translation adjustments. |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Leases | |
Schedule of balance sheet and other information | ​ ​ ​ ​ ​ ​ June 29, (Dollars in millions) 2019 Operating leases: ​ ​ Other assets $ 298 Other current liabilities 53 Other liabilities 247 Finance leases: ​ Property, plant and equipment, less accumulated amortization of $51 million $ 116 Short-term and current portion of long-term debt 6 Long-term debt 77 Weighted-average remaining lease term (in years) ​ Finance leases 14.1 Operating leases 10.3 Weighted-average discount rate ​ Finance leases 2.73 % Operating leases 4.46 % |
Summary of maturities of operating lease liabilities | ​ ​ ​ ​ ​ ​ ​ Operating Finance (In millions) Leases Leases 2019 $ 34 $ 5 2020 57 9 2021 43 9 2022 37 9 2023 31 9 Thereafter 179 69 Total lease payments 381 110 Less: interest (81) (27) Total lease liabilities $ 300 $ 83 |
Summary of maturities of finance lease liabilities | ​ ​ ​ ​ ​ ​ ​ ​ Operating Finance (In millions) Leases Leases 2019 $ 34 $ 5 2020 57 9 2021 43 9 2022 37 9 2023 31 9 Thereafter 179 69 Total lease payments 381 110 Less: interest (81) (27) Total lease liabilities $ 300 $ 83 ​ ​ |
Derivative Instruments and Fa_2
Derivative Instruments and Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Carrying value and estimated fair value of financial instruments | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 December 29, 2018 ​ Carrying Estimated Carrying Estimated (In millions) Value Fair Value Value Fair Value Manufacturing group ​ ​ ​ ​ ​ ​ ​ ​ Debt, excluding leases $ (3,301) $ (3,414) $ (2,996) $ (2,971) Finance group ​ ​ ​ ​ ​ ​ ​ ​ Finance receivables, excluding leases 589 615 582 584 Debt (703) (640) (718) (640) |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Schedule of Shareholder's equity | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Total ​ Common Capital Treasury Retained Comprehensive Shareholders’ (In millions) Stock Surplus Stock Earnings Loss Equity Three months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,689 $ (331) $ 5,581 $ (1,736) $ 5,233 Net income ​ — ​ — ​ — ​ 217 ​ — ​ 217 Other comprehensive income ​ — ​ — ​ — ​ — ​ 21 ​ 21 Share-based compensation activity ​ — ​ 28 ​ — ​ — ​ — ​ 28 Dividends declared ​ — ​ — ​ — ​ (4) ​ — ​ (4) Purchases of common stock ​ — ​ — ​ (159) ​ — ​ — ​ (159) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,710 $ (392) $ 5,642 $ (1,301) $ 5,692 Net income — — — 224 — 224 Other comprehensive (loss) — — — — (42) (42) Share-based compensation activity — 64 — — — 64 Dividends declared — — — (5) — (5) Purchases of common stock — — (571) — — (571) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,646 $ (129) $ 5,407 $ (1,762) $ 5,192 Net income ​ — ​ — ​ — ​ 396 ​ — ​ 396 Other comprehensive income ​ — ​ — ​ — ​ — ​ 47 ​ 47 Share-based compensation activity ​ — ​ 71 ​ — ​ — ​ — ​ 71 Dividends declared ​ — ​ — ​ — ​ (9) ​ — ​ (9) Purchases of common stock ​ — ​ — ​ (361) ​ — ​ — ​ (361) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,669 $ (48) $ 5,368 $ (1,375) $ 5,647 Adoption of ASC 606 — — — 90 — 90 Net income — — — 413 — 413 Other comprehensive income — — — — 32 32 Share-based compensation activity — 105 — — — 105 Dividends declared — — — (10) — (10) Purchases of common stock — — (915) — — (915) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 |
Schedule of weighted-average shares outstanding for basic and diluted EPS | ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In thousands) 2019 2018 2019 2018 Basic weighted-average shares outstanding 232,013 253,904 233,426 257,200 Dilutive effect of stock options 1,532 3,273 1,567 3,262 Diluted weighted-average shares outstanding 233,545 257,177 234,993 260,462 |
Schedule of components of Accumulated Other Comprehensive Loss | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and Foreign Deferred Accumulated ​ Postretirement Currency Gains (Losses) Other ​ Benefits Translation on Hedge Comprehensive (In millions) Adjustments Adjustments Contracts Loss Balance at December 29, 2018 $ (1,727) $ (32) $ (3) $ (1,762) Other comprehensive income before reclassifications ​ — ​ 4 ​ 4 ​ 8 Reclassified from Accumulated other comprehensive loss ​ 41 ​ — ​ (2) ​ 39 Balance at June 29, 2019 $ (1,686) $ (28) $ (1) $ (1,715) Balance at December 30, 2017 $ (1,396) $ 11 $ 10 $ (1,375) Other comprehensive income before reclassifications — (27) (2) (29) Reclassified from Accumulated other comprehensive loss 62 — (1) 61 Balance at June 30, 2018 $ (1,334) $ (16) $ 7 $ (1,343) |
Schedule of before and after-tax components of other comprehensive income (loss) | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 June 30, 2018 ​ ​ ​ Tax ​ ​ ​ Tax ​ ​ Pre-Tax (Expense) After-Tax Pre-Tax (Expense) After-Tax (In millions) Amount Benefit Amount Amount Benefit Amount Three Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 24 $ (6) $ 18 $ 39 $ (9) $ 30 Amortization of prior service cost* 3 (1) 2 ​ 2 ​ (1) ​ 1 Pension and postretirement benefits adjustments, net 27 (7) 20 ​ 41 ​ (10) ​ 31 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 2 (1) 1 ​ (4) ​ 1 ​ (3) Reclassification adjustments (1) — (1) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net ​ 1 ​ (1) ​ — ​ (5) ​ 1 ​ (4) Foreign currency translation adjustments ​ 3 ​ (2) ​ 1 ​ (66) ​ (3) ​ (69) Total $ 31 $ (10) $ 21 $ (30) $ (12) $ (42) Six Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 49 $ (11) $ 38 $ 77 $ (18) $ 59 Amortization of prior service cost* 4 (1) 3 ​ 4 ​ (1) ​ 3 Pension and postretirement benefits adjustments, net 53 (12) 41 ​ 81 ​ (19) ​ 62 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 6 (2) 4 ​ (2) ​ — ​ (2) Reclassification adjustments (2) — (2) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net 4 (2) 2 ​ (3) ​ — ​ (3) Foreign currency translation adjustments 4 — 4 ​ (26) ​ (1) ​ (27) Total $ 61 $ (14) $ 47 $ 52 $ (20) $ 32 *These components of other comprehensive income are included in the computation of net periodic pension cost. See Note 14 of our 2018 Annual Report on Form 10-K for additional information. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Revenues by segment and reconciliation of segment profit to income before income taxes | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Revenues ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 1,123 $ 1,276 $ 2,257 $ 2,286 Bell ​ 771 831 ​ 1,510 ​ 1,583 Textron Systems ​ 308 380 ​ 615 ​ 767 Industrial ​ 1,009 1,222 ​ 1,921 ​ 2,353 Finance ​ 16 17 ​ 33 ​ 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 Segment Profit ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 105 $ 104 $ 211 $ 176 Bell ​ 103 117 ​ 207 ​ 204 Textron Systems ​ 49 40 ​ 77 ​ 90 Industrial ​ 76 80 ​ 126 ​ 144 Finance ​ 6 5 ​ 12 ​ 11 Segment profit ​ 339 346 ​ 633 ​ 625 Corporate expenses and other, net ​ (24) (51) (71) ​ (78) Interest expense, net for Manufacturing group (36) (35) (71) ​ (69) Income before income taxes $ 279 $ 260 $ 491 $ 478 ​ |
Revenues (Tables)
Revenues (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Revenues | |
Schedule of revenue by major product type, customer type and geographic location | Our revenues disaggregated by major product type are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Aircraft $ 733 $ 877 $ 1,499 $ 1,511 Aftermarket parts and services ​ 390 399 ​ 758 775 Textron Aviation ​ 1,123 1,276 ​ 2,257 2,286 Military aircraft and support programs ​ 482 533 ​ 990 1,020 Commercial helicopters, parts and services ​ 289 298 ​ 520 563 Bell ​ 771 831 ​ 1,510 1,583 Unmanned systems ​ 135 161 ​ 269 331 Marine and land systems ​ 60 69 ​ 108 161 Simulation, training and other ​ 113 150 ​ 238 275 Textron Systems ​ 308 380 ​ 615 767 Fuel systems and functional components ​ 592 627 ​ 1,186 1,282 Specialized vehicles ​ 417 475 ​ 735 823 Tools and test equipment ​ — 120 ​ — 248 Industrial ​ 1,009 1,222 ​ 1,921 2,353 Finance ​ 16 17 ​ 33 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 ​ Our revenues for our segments by customer type and geographic location are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions) Textron Bell Textron Industrial Finance Total Three months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,077 $ 279 $ 83 $ 1,004 $ 16 $ 2,459 U.S. Government ​ 46 ​ 492 ​ 225 ​ 5 ​ — ​ 768 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 736 $ 571 $ 249 $ 466 $ 7 $ 2,029 Europe ​ 164 ​ 47 ​ 17 ​ 291 ​ — ​ 519 Asia and Australia ​ 65 ​ 79 ​ 13 ​ 84 ​ 2 ​ 243 Other international ​ 158 ​ 74 ​ 29 ​ 168 ​ 7 ​ 436 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,191 $ 291 $ 107 $ 1,215 $ 17 $ 2,821 U.S. Government 85 540 273 7 — 905 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 914 $ 543 $ 297 $ 590 $ 7 $ 2,351 Europe ​ 128 ​ 50 ​ 23 ​ 372 ​ 2 ​ 575 Asia and Australia ​ 64 ​ 150 ​ 28 ​ 100 ​ 2 ​ 344 Other international 170 88 32 160 6 456 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,169 $ 509 $ 157 $ 1,909 $ 33 $ 4,777 U.S. Government ​ 88 ​ 1,001 ​ 458 ​ 12 ​ — ​ 1,559 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 1,525 $ 1,149 $ 506 $ 855 $ 15 $ 4,050 Europe ​ 347 ​ 67 ​ 40 ​ 602 ​ 1 ​ 1,057 Asia and Australia ​ 88 ​ 161 ​ 29 ​ 161 ​ 3 ​ 442 Other international ​ 297 ​ 133 ​ 40 ​ 303 ​ 14 ​ 787 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,164 $ 543 $ 234 $ 2,339 $ 33 $ 5,313 U.S. Government 122 1,040 533 14 — 1,709 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 1,579 $ 1,052 $ 584 $ 1,086 $ 14 $ 4,315 Europe ​ 274 ​ 77 ​ 35 ​ 755 ​ 3 ​ 1,144 Asia and Australia ​ 145 ​ 277 ​ 56 ​ 192 ​ 4 ​ 674 Other international 288 177 92 320 12 889 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 ​ |
Retirement Plans (Tables)
Retirement Plans (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Components of net periodic benefit cost (credit) | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Pension Benefits ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ 22 $ 27 $ 45 $ 53 Interest cost ​ 81 ​ 76 ​ 163 ​ 153 Expected return on plan assets ​ (139) (139) ​ (278) (277) Amortization of net actuarial loss ​ 25 ​ 39 ​ 50 ​ 77 Amortization of prior service cost ​ 4 3 ​ 7 7 Net periodic benefit cost (credit) $ (7) $ 6 $ (13) $ 13 Postretirement Benefits Other Than Pensions ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ — $ — $ 1 $ 1 Interest cost ​ 3 ​ 3 ​ 5 ​ 5 Amortization of net actuarial loss ​ (1) ​ — ​ (1) ​ — Amortization of prior service credit ​ (1) ​ (1) ​ (3) ​ (3) Net periodic benefit cost $ 1 $ 2 $ 2 $ 3 ​ |
Basis of Presentation (Details)
Basis of Presentation (Details) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019USD ($)$ / shares | Jun. 30, 2018USD ($)$ / shares | Jun. 29, 2019USD ($)item$ / shares | Jun. 30, 2018USD ($)$ / shares | |
Number of borrowing groups | item | 2 | |||
Cumulative catch-up method | ||||
Cumulative catch-up adjustments | $ 27 | $ 64 | $ 58 | $ 104 |
Change in accounting estimate financial effect increase in net income | $ 21 | $ 49 | $ 44 | $ 79 |
Change in accounting estimate financial effect increase in earnings per share diluted | $ / shares | $ 0.09 | $ 0.19 | $ 0.19 | $ 0.30 |
Gross favorable adjustments | $ 46 | $ 70 | $ 99 | $ 126 |
Gross unfavorable adjustments | $ 19 | $ 6 | $ 41 | $ 22 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies Update (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Jan. 01, 2019 | |
Summary of Significant Accounting Policies Update | ||
Operating right-of-use assets | $ 298 | |
Operating lease liabilities | $ 300 | |
Lease, Practical Expedient, Use of Hindsight [true false] | true | |
ASU 2016-02 | ||
Summary of Significant Accounting Policies Update | ||
Operating right-of-use assets | $ 307 | |
Operating lease liabilities | $ 307 |
Accounts Receivable and Finan_3
Accounts Receivable and Finance Receivables - Accounts receivable (Details) - Manufacturing group - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Accounts Receivable | ||
Accounts Receivable, Gross | $ 1,016 | $ 1,051 |
Allowance for doubtful accounts | (27) | (27) |
Total accounts receivable, net | 989 | 1,024 |
Commercial | ||
Accounts Receivable | ||
Accounts Receivable, Gross | 874 | 885 |
U.S. Government contracts | ||
Accounts Receivable | ||
Accounts Receivable, Gross | $ 142 | $ 166 |
Accounts Receivable and Finan_4
Accounts Receivable and Finance Receivables - Finance receivables (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Finance Receivables | ||
Finance receivables | $ 802 | $ 789 |
Allowance for losses | (26) | (29) |
Total finance receivables, net | $ 776 | $ 760 |
Accounts Receivable and Finan_5
Accounts Receivable and Finance Receivables - Finance receivables by delinquency aging category (Details) $ in Millions | 6 Months Ended | |
Jun. 29, 2019USD ($)item | Dec. 29, 2018USD ($) | |
Finance receivables categorized based on the internally assigned credit quality | ||
Number of loan categories based on key credit quality indicators for individual loan | item | 3 | |
60 + days contractual delinquency as a percentage of finance receivables | 1.50% | 1.77% |
Less than 31 days past due | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | $ 726 | $ 719 |
31-60 days past due | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | 64 | 56 |
61- 90 days past due | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | 3 | 5 |
Over 90 days past due | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | 9 | 9 |
Performing | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | 732 | 704 |
Watchlist | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | 39 | 45 |
Nonaccrual | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Total finance receivables | $ 31 | $ 40 |
Nonaccrual as a percentage of finance receivables | 3.87% | 5.07% |
Minimum | Nonaccrual | ||
Finance receivables categorized based on the internally assigned credit quality | ||
Number of months of contractual delinquency to classify accounts as nonaccrual unless such collection is not doubtful | 3 months |
Accounts Receivable and Finan_6
Accounts Receivable and Finance Receivables - Finance receivables and allowance for losses based on the results of impairment evaluation (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 29, 2019 | Dec. 29, 2018 | |
Finance receivables | ||
Finance receivables evaluated collectively | $ 669 | $ 630 |
Finance receivables evaluated individually | 31 | 58 |
Allowance for losses based on collective evaluation | 24 | 24 |
Allowance for losses based on individual evaluation | 2 | 5 |
Impaired finance receivables with no related allowance for losses | 23 | 43 |
Impaired finance receivables with related allowance for losses | 8 | 15 |
Unpaid principal balance of impaired finance receivables | 41 | 67 |
Average recorded investment of impaired finance receivables | $ 40 | $ 61 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Inventories | ||
Finished goods | $ 1,743 | $ 1,662 |
Work in process | 1,771 | 1,356 |
Raw materials and components | 797 | 800 |
Total inventories | $ 4,311 | $ 3,818 |
Other Assets (Details)
Other Assets (Details) $ in Millions | Apr. 01, 2019USD ($) |
Equity method investment | |
Contributed assets | $ 69 |
Allocated goodwill | 71 |
Amount of net pre-tax gain subject to post-closing adjustments | $ 18 |
FlightSafety Textron Aviation Training LLC | |
Equity method investment | |
Investment (in percentage) | 30.00% |
Warranty Liability (Details)
Warranty Liability (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Jun. 30, 2018 | |
Changes in warranty liability | ||
Balance at beginning of period | $ 149 | $ 164 |
Provision | 30 | 34 |
Settlements | (38) | (39) |
Adjustments | (5) | 7 |
Balance at end of period | $ 136 | $ 166 |
Leases (Details)
Leases (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 29, 2019USD ($) | Jun. 29, 2019USD ($) | |
Leases | ||
Operating lease - Option to extend | true | |
Operating lease cost | $ 16 | $ 32 |
Cash paid for operating lease liabilities | $ 32 | |
Maximum | ||
Leases | ||
Operating lease and finance lease - Remaining lease term | 30 years | |
Operating lease - Option to extend the lease, term | 25 years | 25 years |
Leases - Balance sheet and othe
Leases - Balance sheet and other information (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Operating leases: | ||
Other assets | $ 298 | |
Other assets | us-gaap:OtherAssets | |
Other current liabilities | $ 53 | |
Other current liabilities | us-gaap:OtherLiabilitiesCurrent | |
Other liabilities | $ 247 | |
Other liabilities | us-gaap:OtherLiabilities | |
Finance leases: | ||
Property, plant and equipment, less accumulated amortization of $51 million | $ 116 | |
Property, plant and equipment, less accumulated amortization of $51 million | us-gaap:PropertyPlantAndEquipmentNet | |
Accumulated amortization | $ 4,317 | $ 4,203 |
Short-term and current portion of long-term debt | $ 6 | |
Short-term and current portion of long-term debt | us-gaap:DebtCurrent | |
Long-term debt | $ 77 | |
Long-term debt | us-gaap:LongTermDebtAndCapitalLeaseObligations | |
Weighted-average remaining lease term (in years) | ||
Finance leases | 14 years 1 month 6 days | |
Operating leases | 10 years 3 months 18 days | |
Weighted-average discount rate | ||
Finance leases | 2.73% | |
Operating leases | 4.46% | |
Finance leased assets | ||
Finance leases: | ||
Accumulated amortization | $ 51 |
Leases - Maturity of lease liab
Leases - Maturity of lease liabilities (Details) $ in Millions | Jun. 29, 2019USD ($) |
Operating Leases | |
2019 | $ 34 |
2020 | 57 |
2021 | 43 |
2022 | 37 |
2023 | 31 |
Thereafter | 179 |
Total lease payments | 381 |
Less: interest | (81) |
Total lease liabilities | 300 |
Finance Leases | |
2019 | 5 |
2020 | 9 |
2021 | 9 |
2022 | 9 |
2023 | 9 |
Thereafter | 69 |
Total lease payments | 110 |
Less: interest | (27) |
Total lease liabilities | $ 83 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | May 07, 2019 | Jun. 24, 2019 | Jun. 23, 2019 |
Fixed rate notes due 2029 | |||
Debt | |||
Issuance of debt | $ 300 | ||
Interest rate (as a percent) | 3.90% | ||
Net proceeds from issuance | $ 297 | ||
Fixed rate notes due 2019 | |||
Debt | |||
Interest rate (as a percent) | 2.88% | 2.26% | |
Loan | $ 150 |
Derivative Instruments and Fa_3
Derivative Instruments and Fair Value Measurements - Assets and liabilities recorded at fair value on a recurring basis (Details) - Manufacturing group - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Dec. 29, 2018 | |
Fair value of derivative instruments | ||
Forward exchange contracts maximum maturity period | 3 years | |
Foreign currency exchange contracts | ||
Fair value of derivative instruments | ||
Notional amounts | $ 395 | $ 379 |
Level 2 | Foreign currency exchange contracts | ||
Fair value of derivative instruments | ||
Derivative Asset, Fair Value | 2 | 2 |
Derivative Liability, Fair Value | $ 3 | $ 10 |
Derivative Instruments and Fa_4
Derivative Instruments and Fair Value Measurements - Assets and liabilities not recorded at fair value (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Manufacturing group | Carrying Value | ||
Financial instruments not reflected at fair value | ||
Debt, excluding leases | $ (3,301) | $ (2,996) |
Manufacturing group | Estimated Fair Value | ||
Financial instruments not reflected at fair value | ||
Debt, excluding leases | (3,414) | (2,971) |
Finance group | ||
Financial instruments not reflected at fair value | ||
Debt | (703) | (718) |
Finance group | Carrying Value | ||
Financial instruments not reflected at fair value | ||
Finance receivables, excluding leases | 589 | 582 |
Debt | (703) | (718) |
Finance group | Estimated Fair Value | ||
Financial instruments not reflected at fair value | ||
Finance receivables, excluding leases | 615 | 584 |
Debt | $ (640) | $ (640) |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Increase (Decrease) in Stockholders' Equity | ||||
Beginning of period | $ 5,233 | $ 5,692 | $ 5,192 | $ 5,647 |
Net income | 217 | 224 | 396 | 413 |
Other comprehensive income (loss) | 21 | (42) | 47 | 32 |
Share-based compensation activity | 28 | 64 | 71 | 105 |
Dividends declared | (4) | (5) | (9) | (10) |
Purchases of common stock | (159) | (571) | (361) | (915) |
End of period | $ 5,336 | $ 5,362 | $ 5,336 | $ 5,362 |
Dividends per share of common stock | $ 0.02 | $ 0.02 | $ 0.04 | $ 0.04 |
Common Stock | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Beginning of period | $ 30 | $ 33 | $ 30 | $ 33 |
End of period | 30 | 33 | 30 | 33 |
Capital Surplus | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Beginning of period | 1,689 | 1,710 | 1,646 | 1,669 |
Share-based compensation activity | 28 | 64 | 71 | 105 |
End of period | 1,717 | 1,774 | 1,717 | 1,774 |
Treasury Stock | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Beginning of period | (331) | (392) | (129) | (48) |
Purchases of common stock | (159) | (571) | (361) | (915) |
End of period | (490) | (963) | (490) | (963) |
Retained Earnings | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Beginning of period | 5,581 | 5,642 | 5,407 | 5,368 |
Net income | 217 | 224 | 396 | 413 |
Dividends declared | (4) | (5) | (9) | (10) |
End of period | 5,794 | 5,861 | 5,794 | 5,861 |
Accumulated Other Comprehensive Loss | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Beginning of period | (1,736) | (1,301) | (1,762) | (1,375) |
Other comprehensive income (loss) | 21 | (42) | 47 | 32 |
End of period | $ (1,715) | $ (1,343) | $ (1,715) | (1,343) |
ASC 606 | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Adoption of ASC 606 | 90 | |||
ASC 606 | Retained Earnings | ||||
Increase (Decrease) in Stockholders' Equity | ||||
Adoption of ASC 606 | $ 90 |
Shareholders' Equity - Earnings
Shareholders' Equity - Earnings Per Share (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Weighted-average shares outstanding for basic and diluted EPS | ||||
Basic weighted-average shares outstanding | 232,013 | 253,904 | 233,426 | 257,200 |
Dilutive effect of stock options | 1,532 | 3,273 | 1,567 | 3,262 |
Diluted weighted-average shares outstanding | 233,545 | 257,177 | 234,993 | 260,462 |
Anti-dilutive effect of weighted average shares | 3,100 | 1,300 | 3,100 | 1,300 |
Shareholders' Equity - Componen
Shareholders' Equity - Components of accumulated other comprehensive loss (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Jun. 30, 2018 | |
Components of Accumulated Other Comprehensive Loss | ||
Beginning of period | $ (1,762) | |
End of period | (1,715) | |
Accumulated Other Comprehensive Loss | ||
Components of Accumulated Other Comprehensive Loss | ||
Beginning of period | (1,762) | $ (1,375) |
Other comprehensive income before reclassifications | 8 | (29) |
Reclassified from Accumulated other comprehensive loss | 39 | 61 |
End of period | (1,715) | (1,343) |
Pension and Postretirement Benefits Adjustments | ||
Components of Accumulated Other Comprehensive Loss | ||
Beginning of period | (1,727) | (1,396) |
Reclassified from Accumulated other comprehensive loss | 41 | 62 |
End of period | (1,686) | (1,334) |
Foreign Currency Translation Adjustments | ||
Components of Accumulated Other Comprehensive Loss | ||
Beginning of period | (32) | 11 |
Other comprehensive income before reclassifications | 4 | (27) |
End of period | (28) | (16) |
Deferred Gains (Losses) on Hedge Contracts | ||
Components of Accumulated Other Comprehensive Loss | ||
Beginning of period | (3) | 10 |
Other comprehensive income before reclassifications | 4 | (2) |
Reclassified from Accumulated other comprehensive loss | (2) | (1) |
End of period | $ (1) | $ 7 |
Shareholders' Equity - Before a
Shareholders' Equity - Before and after-tax components of other comprehensive income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Pension and postretirement benefits adjustments, pre-tax: | ||||
Amortization of net actuarial loss, pre-tax | $ 24 | $ 39 | $ 49 | $ 77 |
Amortization of prior service cost, pre-tax | 3 | 2 | 4 | 4 |
Pension and postretirement benefits adjustments, net, pre-tax | 27 | 41 | 53 | 81 |
Deferred gains (losses) on hedge contracts, pre-tax: | ||||
Current deferrals, pre-tax | 2 | (4) | 6 | (2) |
Reclassification adjustments, pre-tax | (1) | (1) | (2) | (1) |
Deferred gains (losses) on hedge contracts, net, pre-tax | 1 | (5) | 4 | (3) |
Foreign currency translation adjustments, pre-tax: | ||||
Foreign currency translation adjustments, pre-tax | 3 | (66) | 4 | (26) |
Other comprehensive income (loss), pre-tax | 31 | (30) | 61 | 52 |
Pension and postretirement benefits adjustments, tax: | ||||
Amortization of net actuarial loss, tax | (6) | (9) | (11) | (18) |
Amortization of prior service cost, tax | (1) | (1) | (1) | (1) |
Pension and postretirement benefits adjustments, net, tax | (7) | (10) | (12) | (19) |
Deferred gains (losses) on hedge contracts, tax: | ||||
Current deferrals, tax | (1) | 1 | (2) | |
Deferred gains (losses) on hedge contracts, net, tax | (1) | 1 | (2) | |
Foreign currency translation adjustments, tax: | ||||
Foreign currency translation adjustments, tax | (2) | (3) | (1) | |
Other comprehensive income (loss), tax | (10) | (12) | (14) | (20) |
Pension and postretirement benefits adjustments, after-tax: | ||||
Amortization of net actuarial loss, after-tax | 18 | 30 | 38 | 59 |
Amortization of prior service cost, after-tax | 2 | 1 | 3 | 3 |
Pension and postretirement benefits adjustments, net, after-tax | 20 | 31 | 41 | 62 |
Deferred gains (losses) on hedge contracts, after-tax: | ||||
Current deferrals, after-tax | 1 | (3) | 4 | (2) |
Reclassification adjustments, after-tax | (1) | (1) | (2) | (1) |
Deferred gains (losses) on hedge contracts, net, after-tax | (4) | 2 | (3) | |
Foreign currency translation adjustments, after-tax: | ||||
Foreign currency translation adjustments, after-tax | 1 | (69) | 4 | (27) |
Other comprehensive income (loss) | $ 21 | $ (42) | $ 47 | $ 32 |
Segment Information - Operating
Segment Information - Operating and reportable segments (Details) | 6 Months Ended |
Jun. 29, 2019segment | |
Operating and reportable business segments | |
Number of business operating segments | 5 |
Number of reportable business segments | 5 |
Segment Information - Revenue b
Segment Information - Revenue by segments and reconciliation of segment profit to income from continuing operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Revenues | ||||
Total revenues | $ 3,227 | $ 3,726 | $ 6,336 | $ 7,022 |
Reconciliation of segment profit to income from continuing operations before income taxes | ||||
Income before income taxes | 279 | 260 | 491 | 478 |
Operating Segment | ||||
Segment Profit | ||||
Segment Profit | 339 | 346 | 633 | 625 |
Corporate | ||||
Reconciliation of segment profit to income from continuing operations before income taxes | ||||
Corporate expenses and other, net | (24) | (51) | (71) | (78) |
Finance | ||||
Revenues | ||||
Finance Revenue | 16 | 17 | 33 | 33 |
Finance | Operating Segment | ||||
Segment Profit | ||||
Segment Profit | 6 | 5 | 12 | 11 |
Manufacturing group | Reconciling Items | ||||
Reconciliation of segment profit to income from continuing operations before income taxes | ||||
Interest expense, net for Manufacturing group | (36) | (35) | (71) | (69) |
Manufacturing group | Textron Aviation | ||||
Revenues | ||||
Total revenues | 1,123 | 1,276 | 2,257 | 2,286 |
Manufacturing group | Textron Aviation | Operating Segment | ||||
Segment Profit | ||||
Segment Profit | 105 | 104 | 211 | 176 |
Manufacturing group | Bell | ||||
Revenues | ||||
Total revenues | 771 | 831 | 1,510 | 1,583 |
Manufacturing group | Bell | Operating Segment | ||||
Segment Profit | ||||
Segment Profit | 103 | 117 | 207 | 204 |
Manufacturing group | Textron Systems | ||||
Revenues | ||||
Total revenues | 308 | 380 | 615 | 767 |
Manufacturing group | Textron Systems | Operating Segment | ||||
Segment Profit | ||||
Segment Profit | 49 | 40 | 77 | 90 |
Manufacturing group | Industrial | ||||
Revenues | ||||
Total revenues | 1,009 | 1,222 | 1,921 | 2,353 |
Manufacturing group | Industrial | Operating Segment | ||||
Segment Profit | ||||
Segment Profit | 76 | 80 | 126 | 144 |
Finance group | Finance | ||||
Revenues | ||||
Finance Revenue | $ 16 | $ 17 | $ 33 | $ 33 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Revenues | ||||
Total revenues | $ 3,227 | $ 3,726 | $ 6,336 | $ 7,022 |
United States | ||||
Revenues | ||||
Total revenues | 2,029 | 2,351 | 4,050 | 4,315 |
Europe | ||||
Revenues | ||||
Total revenues | 519 | 575 | 1,057 | 1,144 |
Asia and Australia | ||||
Revenues | ||||
Total revenues | 243 | 344 | 442 | 674 |
Other international | ||||
Revenues | ||||
Total revenues | 436 | 456 | 787 | 889 |
Commercial | ||||
Revenues | ||||
Total revenues | 2,459 | 2,821 | 4,777 | 5,313 |
U.S. Government | ||||
Revenues | ||||
Total revenues | 768 | 905 | 1,559 | 1,709 |
Textron Aviation | ||||
Revenues | ||||
Total revenues | 1,123 | 1,276 | 2,257 | 2,286 |
Textron Aviation | United States | ||||
Revenues | ||||
Total revenues | 736 | 914 | 1,525 | 1,579 |
Textron Aviation | Europe | ||||
Revenues | ||||
Total revenues | 164 | 128 | 347 | 274 |
Textron Aviation | Asia and Australia | ||||
Revenues | ||||
Total revenues | 65 | 64 | 88 | 145 |
Textron Aviation | Other international | ||||
Revenues | ||||
Total revenues | 158 | 170 | 297 | 288 |
Textron Aviation | Commercial | ||||
Revenues | ||||
Total revenues | 1,077 | 1,191 | 2,169 | 2,164 |
Textron Aviation | U.S. Government | ||||
Revenues | ||||
Total revenues | 46 | 85 | 88 | 122 |
Textron Aviation | Aircraft | ||||
Revenues | ||||
Total revenues | 733 | 877 | 1,499 | 1,511 |
Textron Aviation | Aftermarket parts and services | ||||
Revenues | ||||
Total revenues | 390 | 399 | 758 | 775 |
Bell | ||||
Revenues | ||||
Total revenues | 771 | 831 | 1,510 | 1,583 |
Bell | United States | ||||
Revenues | ||||
Total revenues | 571 | 543 | 1,149 | 1,052 |
Bell | Europe | ||||
Revenues | ||||
Total revenues | 47 | 50 | 67 | 77 |
Bell | Asia and Australia | ||||
Revenues | ||||
Total revenues | 79 | 150 | 161 | 277 |
Bell | Other international | ||||
Revenues | ||||
Total revenues | 74 | 88 | 133 | 177 |
Bell | Commercial | ||||
Revenues | ||||
Total revenues | 279 | 291 | 509 | 543 |
Bell | U.S. Government | ||||
Revenues | ||||
Total revenues | 492 | 540 | 1,001 | 1,040 |
Bell | Military aircraft and support programs | ||||
Revenues | ||||
Total revenues | 482 | 533 | 990 | 1,020 |
Bell | Commercial helicopters, parts and services | ||||
Revenues | ||||
Total revenues | 289 | 298 | 520 | 563 |
Textron Systems | ||||
Revenues | ||||
Total revenues | 308 | 380 | 615 | 767 |
Textron Systems | United States | ||||
Revenues | ||||
Total revenues | 249 | 297 | 506 | 584 |
Textron Systems | Europe | ||||
Revenues | ||||
Total revenues | 17 | 23 | 40 | 35 |
Textron Systems | Asia and Australia | ||||
Revenues | ||||
Total revenues | 13 | 28 | 29 | 56 |
Textron Systems | Other international | ||||
Revenues | ||||
Total revenues | 29 | 32 | 40 | 92 |
Textron Systems | Commercial | ||||
Revenues | ||||
Total revenues | 83 | 107 | 157 | 234 |
Textron Systems | U.S. Government | ||||
Revenues | ||||
Total revenues | 225 | 273 | 458 | 533 |
Textron Systems | Unmanned systems | ||||
Revenues | ||||
Total revenues | 135 | 161 | 269 | 331 |
Textron Systems | Marine and land systems | ||||
Revenues | ||||
Total revenues | 60 | 69 | 108 | 161 |
Textron Systems | Simulation, training and other | ||||
Revenues | ||||
Total revenues | 113 | 150 | 238 | 275 |
Industrial | ||||
Revenues | ||||
Total revenues | 1,009 | 1,222 | 1,921 | 2,353 |
Industrial | United States | ||||
Revenues | ||||
Total revenues | 466 | 590 | 855 | 1,086 |
Industrial | Europe | ||||
Revenues | ||||
Total revenues | 291 | 372 | 602 | 755 |
Industrial | Asia and Australia | ||||
Revenues | ||||
Total revenues | 84 | 100 | 161 | 192 |
Industrial | Other international | ||||
Revenues | ||||
Total revenues | 168 | 160 | 303 | 320 |
Industrial | Commercial | ||||
Revenues | ||||
Total revenues | 1,004 | 1,215 | 1,909 | 2,339 |
Industrial | U.S. Government | ||||
Revenues | ||||
Total revenues | 5 | 7 | 12 | 14 |
Industrial | Fuel systems and functional components | ||||
Revenues | ||||
Total revenues | 592 | 627 | 1,186 | 1,282 |
Industrial | Specialized vehicles | ||||
Revenues | ||||
Total revenues | 417 | 475 | 735 | 823 |
Industrial | Tools and test equipment | ||||
Revenues | ||||
Total revenues | 120 | 248 | ||
Finance | ||||
Revenues | ||||
Finance Revenue | 16 | 17 | 33 | 33 |
Finance | United States | ||||
Revenues | ||||
Finance Revenue | 7 | 7 | 15 | 14 |
Finance | Europe | ||||
Revenues | ||||
Finance Revenue | 2 | 1 | 3 | |
Finance | Asia and Australia | ||||
Revenues | ||||
Finance Revenue | 2 | 2 | 3 | 4 |
Finance | Other international | ||||
Revenues | ||||
Finance Revenue | 7 | 6 | 14 | 12 |
Finance | Commercial | ||||
Revenues | ||||
Finance Revenue | $ 16 | $ 17 | $ 33 | $ 33 |
Revenues - Remaining Performanc
Revenues - Remaining Performance Obligations (Details) $ in Billions | Jun. 29, 2019USD ($) |
Remaining performance obligations | $ 9.3 |
Revenues - Remaining Performa_2
Revenues - Remaining Performance Obligations & Revenue Expected to be recognized (Details) | Jun. 29, 2019 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-02 | |
Remaining Performance Obligation, Expected Timing of Satisfaction | |
Percentage of remaining performance obligation expected to be recognized in period | 68.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-12-31 | |
Remaining Performance Obligation, Expected Timing of Satisfaction | |
Percentage of remaining performance obligation expected to be recognized in period | 26.00% |
Revenues - Contract Assets and
Revenues - Contract Assets and Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | Dec. 29, 2018 | |
Contract Assets and Liabilities | |||||
Contract assets | $ 499 | $ 499 | $ 461 | ||
Contract liabilities | 897 | 897 | $ 974 | ||
Revenue recognized included in contract liabilities | $ 146 | $ 377 | $ 457 | $ 699 |
Retirement Plans - Net periodic
Retirement Plans - Net periodic benefit cost (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Pension Benefits | ||||
Net periodic benefit cost | ||||
Service cost | $ 22 | $ 27 | $ 45 | $ 53 |
Interest cost | 81 | 76 | 163 | 153 |
Expected return on plan assets | (139) | (139) | (278) | (277) |
Amortization of net actuarial loss | 25 | 39 | 50 | 77 |
Amortization of prior service cost (credit) | 4 | 3 | 7 | 7 |
Net periodic benefit cost (credit) | (7) | 6 | (13) | 13 |
Postretirement Benefits Other Than Pensions | ||||
Net periodic benefit cost | ||||
Service cost | 1 | 1 | ||
Interest cost | 3 | 3 | 5 | 5 |
Amortization of net actuarial loss | (1) | (1) | ||
Amortization of prior service cost (credit) | (1) | (1) | (3) | (3) |
Net periodic benefit cost (credit) | $ 1 | $ 2 | $ 2 | $ 3 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | Dec. 29, 2018 | |
Income Taxes | |||||
Effective income tax rate (as a percent) | 22.20% | 13.80% | 19.30% | 13.60% | |
U.S. federal statutory income tax rate (as a percent) | 21.00% | 21.00% | 21.00% | ||
Discrete tax benefit | $ 25 | $ 12 | $ 25 | ||
Unrecognized tax benefits | $ 175 | $ 175 | $ 141 |