Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 14, 2020 | Jun. 30, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-03761 | ||
Entity Registrant Name | TEXAS INSTRUMENTS INCORPORATED | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 75-0289970 | ||
Entity Address, Address Line One | 12500 TI Boulevard | ||
Entity Address, City or Town | Dallas | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 75243 | ||
City Area Code | 214 | ||
Local Phone Number | 479-3773 | ||
Title of 12(b) Security | Common Stock, par value $1.00 | ||
Trading Symbol | TXN | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
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 Public Float | $ 107,187,939,993 | ||
Entity Common Stock, Shares Outstanding | 933,975,619 | ||
Documents Incorporated by Reference | Part III hereof incorporates information by reference to the Registrant’s proxy statement for the 2020 annual meeting of stockholders. | ||
Entity Central Index Key | 0000097476 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Revenue | $ 14,383 | $ 15,784 | $ 14,961 |
Cost of revenue (COR) | 5,219 | 5,507 | 5,347 |
Gross profit | 9,164 | 10,277 | 9,614 |
Research and development (R&D) | 1,544 | 1,559 | 1,508 |
Selling, general and administrative (SG&A) | 1,645 | 1,684 | 1,694 |
Acquisition charges | 288 | 318 | 318 |
Restructuring charges/other | (36) | 3 | 11 |
Operating profit | 5,723 | 6,713 | 6,083 |
Other income (expense), net (OI&E) | 175 | 98 | 75 |
Interest and debt expense | 170 | 125 | 78 |
Income before income taxes | 5,728 | 6,686 | 6,080 |
Provision for income taxes | 711 | 1,106 | 2,398 |
Net income | $ 5,017 | $ 5,580 | $ 3,682 |
Earnings per common share (EPS): | |||
Basic (in dollars per share) | $ 5.33 | $ 5.71 | $ 3.68 |
Diluted (in dollars per share) | $ 5.24 | $ 5.59 | $ 3.61 |
Average shares outstanding (millions): | |||
Basic (in shares) | 936 | 970 | 991 |
Diluted (in shares) | 952 | 990 | 1,012 |
Diluted EPS: | |||
Net income | $ 5,017 | $ 5,580 | $ 3,682 |
Income allocated to RSUs | (31) | (42) | (33) |
Income allocated to common stock for diluted EPS | $ 4,986 | $ 5,538 | $ 3,649 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 5,017 | $ 5,580 | $ 3,682 |
Net actuarial losses of defined benefit plans: | |||
Adjustments, net of tax effect of ($37), $35 and ($26) | 88 | (98) | 92 |
Recognized within net income, net of tax effect of ($13), ($15) and ($27) | 38 | 50 | 56 |
Prior service credit of defined benefit plans: | |||
Adjustments, net of tax effect of $0, $1 and $1 | 0 | (6) | (2) |
Recognized within net income, net of tax effect of $0, $1 and $1 | 0 | (3) | (5) |
Derivative instruments: | |||
Change in fair value, net of tax effect of $0, $1 and $0 - post adoption | 0 | ||
Change in fair value, net of tax effect of $0, $1 and $0 - pre adoption | (2) | 0 | |
Recognized within net income, net of tax effect of $0, $0 and $0 - post adoption | 0 | ||
Recognized within net income, net of tax effect of $0, $0 and $0 - pre adoption | 0 | 1 | |
Other comprehensive income (loss), net of taxes | 126 | (59) | 142 |
Total comprehensive income | $ 5,143 | $ 5,521 | $ 3,824 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income | |||
Net actuarial losses of defined benefit plans adjustment, tax effect | $ (37) | $ 35 | $ (26) |
Net actuarial losses of defined benefit plans recognized within net income, tax effect | (13) | (15) | (27) |
Prior service credit of defined benefit plans adjustment, tax effect | 0 | 1 | 1 |
Prior service credit of defined benefit plans recognized within net income, tax effect | 0 | 1 | 1 |
Derivative instruments change in fair value, tax effect - post adoption | 0 | ||
Derivative instruments change in fair value, tax effect - pre adoption | 1 | 0 | |
Derivative instruments recognized within net income, tax effect - post adoption | $ 0 | ||
Derivative instruments recognized within net income, tax effect - pre adoption | $ 0 | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 2,437 | $ 2,438 |
Short-term investments | 2,950 | 1,795 |
Accounts receivable, net of allowances of ($8) and ($19) | 1,074 | 1,207 |
Raw materials | 176 | 181 |
Work in process | 916 | 1,070 |
Finished goods | 909 | 966 |
Inventories | 2,001 | 2,217 |
Prepaid expenses and other current assets | 299 | 440 |
Total current assets | 8,761 | 8,097 |
Property, plant and equipment at cost | 5,740 | 5,425 |
Accumulated depreciation | (2,437) | (2,242) |
Property, plant and equipment | 3,303 | 3,183 |
Long-term investments | 300 | 251 |
Goodwill | 4,362 | 4,362 |
Acquisition-related intangibles | 340 | 628 |
Deferred tax assets | 197 | 295 |
Capitalized software licenses | 69 | 89 |
Overfunded retirement plans | 218 | 92 |
Other long-term assets | 468 | 140 |
Total assets | 18,018 | 17,137 |
Current liabilities: | ||
Current portion of long-term debt | 500 | 749 |
Accounts payable | 388 | 478 |
Accrued compensation | 714 | 724 |
Income taxes payable | 46 | 103 |
Accrued expenses and other liabilities | 475 | 420 |
Total current liabilities | 2,123 | 2,474 |
Long-term debt | 5,303 | 4,319 |
Underfunded retirement plans | 93 | 118 |
Deferred tax liabilities | 78 | 42 |
Other long-term liabilities | 1,514 | 1,190 |
Total liabilities | 9,111 | 8,143 |
Stockholders’ equity: | ||
Preferred stock, $25 par value. Authorized - 10,000,000 shares Participating cumulative preferred - None issued. | 0 | 0 |
Common stock, $1 par value. Authorized - 2,400,000,000 shares Shares issued - 1,740,815,939 | 1,741 | 1,741 |
Paid-in capital | 2,110 | 1,950 |
Retained earnings | 39,898 | 37,906 |
Treasury common stock at cost Shares: 2019 - 808,784,381; 2018 - 795,665,646 | (34,495) | (32,130) |
Accumulated other comprehensive income (loss), net of taxes (AOCI) | (347) | (473) |
Total stockholders’ equity | 8,907 | 8,994 |
Total liabilities and stockholders’ equity | $ 18,018 | $ 17,137 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Allowance for doubtful accounts receivable, current | $ 8 | $ 19 |
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 25 | $ 25 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 2,400,000,000 | 2,400,000,000 |
Common stock, shares issued (in shares) | 1,740,815,939 | 1,740,815,939 |
Treasury stock (in shares) | 808,784,381 | 795,665,646 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Cash flows from operating activities | ||||
Net income | $ 5,017 | $ 5,580 | $ 3,682 | |
Adjustments to net income: | ||||
Depreciation | 708 | 590 | 539 | |
Amortization of acquisition-related intangibles | 288 | 318 | 318 | |
Amortization of capitalized software | 54 | 46 | 47 | |
Stock compensation | 217 | 232 | 242 | |
Gain (Loss) on Disposition of Assets | (23) | (3) | 0 | |
Deferred taxes | 81 | (105) | 112 | |
Increase (decrease) from changes in: | ||||
Accounts receivable | 133 | 71 | (7) | |
Inventories | 216 | (282) | (167) | |
Prepaid expenses and other current assets | 265 | 669 | 76 | |
Accounts payable and accrued expenses | (93) | (7) | 51 | |
Accrued compensation | (15) | (7) | (3) | |
Income taxes payable | (193) | 158 | 468 | |
Changes in funded status of retirement plans | 29 | 36 | 21 | |
Other | (35) | (107) | (16) | |
Cash flows from operating activities | 6,649 | 7,189 | 5,363 | |
Cash flows from investing activities | ||||
Capital expenditures | (847) | (1,131) | (695) | |
Proceeds from asset sales | 30 | 9 | 40 | |
Purchases of short-term investments | (3,444) | (5,641) | (4,555) | |
Proceeds from short-term investments | 2,309 | 6,708 | 4,095 | |
Other | 32 | (23) | (12) | |
Cash flows from investing activities | (1,920) | (78) | (1,127) | |
Cash flows from financing activities | ||||
Proceeds from issuance of long-term debt | 1,491 | 1,500 | 1,099 | |
Repayment of debt | (750) | (500) | (625) | |
Dividends paid | (3,008) | (2,555) | (2,104) | |
Stock repurchases | (2,960) | (5,100) | (2,556) | |
Proceeds from common stock transactions | [1] | 539 | 373 | 483 |
Other | (42) | (47) | (31) | |
Cash flows from financing activities | (4,730) | (6,329) | (3,734) | |
Net change in cash and cash equivalents | (1) | 782 | 502 | |
Cash and cash equivalents at beginning of period | 2,438 | 1,656 | 1,154 | |
Cash and cash equivalents at end of period | $ 2,437 | $ 2,438 | $ 1,656 | |
[1] | Net of taxes paid for employee shares withheld of $52 million, $60 million and $83 million in 2019, 2018 and 2017, respectively. |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions | Total | Common Stock | Paid-in Capital | Retained Earnings | Treasury Common Stock | AOCI |
Balance, beginning balance at Dec. 31, 2016 | $ 1,741 | $ 1,674 | $ 33,107 | $ (25,523) | $ (526) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | $ 3,682 | 3,682 | ||||
Dividends declared and paid | (2,104) | |||||
Common stock issued for stock-based awards | (138) | 621 | ||||
Stock repurchases | (2,556) | |||||
Stock compensation | 242 | |||||
Other comprehensive income (loss), net of taxes | 142 | 142 | ||||
Dividend equivalents on RSUs | (17) | |||||
Other | (2) | (6) | ||||
Balance, ending balance at Dec. 31, 2017 | 1,741 | 1,776 | 34,662 | (27,458) | (384) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 5,580 | 5,580 | ||||
Dividends declared and paid | (2,555) | |||||
Common stock issued for stock-based awards | (55) | 428 | ||||
Stock repurchases | (5,100) | |||||
Stock compensation | 232 | |||||
Other comprehensive income (loss), net of taxes | (59) | (59) | ||||
Dividend equivalents on RSUs | (17) | |||||
Cumulative effect of accounting changes | 236 | (30) | ||||
Other | (3) | |||||
Balance, ending balance at Dec. 31, 2018 | 8,994 | 1,741 | 1,950 | 37,906 | (32,130) | (473) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 5,017 | 5,017 | ||||
Dividends declared and paid | (3,008) | |||||
Common stock issued for stock-based awards | (55) | 594 | ||||
Stock repurchases | (2,960) | |||||
Stock compensation | 217 | |||||
Other comprehensive income (loss), net of taxes | 126 | 126 | ||||
Dividend equivalents on RSUs | (17) | |||||
Other | (2) | 1 | ||||
Balance, ending balance at Dec. 31, 2019 | $ 8,907 | $ 1,741 | $ 2,110 | $ 39,898 | $ (34,495) | $ (347) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends declared per common share (in dollars per share) | $ 3.21 | $ 2.63 | $ 2.12 |
Cash dividends paid per common share (in dollars per share) | $ 3.21 | $ 2.63 | $ 2.12 |
Description of Business, Includ
Description of Business, Including Segment and Geographic Area Information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Description of business, including segment and geographic area information | Description of business, including segment and geographic area information We design, make and sell semiconductors to electronics designers and manufacturers all over the world. We have two reportable segments, which are established along major categories of products as follows: • Analog – consisting of the following product lines: Power, Signal Chain and High Volume. • Embedded Processing – consisting of the following product lines: Connected Microcontrollers and Processors. We report the results of our remaining business activities in Other. Other includes operating segments that do not meet the quantitative thresholds for individually reportable segments and cannot be aggregated with other operating segments. Other includes DLP ® products, calculators and custom ASIC products. In Other, we also include items that are not used in evaluating the results of or in allocating resources to our segments. Examples of these items include acquisition charges (see Note 7); restructuring charges (see Note 12); and certain corporate-level items, such as litigation expenses, environmental costs, insurance settlements, and gains and losses from other activities, including asset dispositions. We allocate the remainder of our expenses associated with corporate activities to our operating segments based on specific methodologies, such as percentage of operating expenses or headcount. Our centralized manufacturing and support organizations, such as facilities, procurement and logistics, provide support to our operating segments, including those in Other. Costs incurred by these organizations, including depreciation, are charged to the segments on a per-unit basis. Consequently, depreciation expense is not an independently identifiable component within the segments’ results and therefore is not provided. With the exception of goodwill, we do not identify or allocate assets by operating segment, nor does the chief operating decision maker evaluate operating segments using discrete asset information. We have no material intersegment revenue. The accounting policies of the segments are consistent with those described below in the summary of significant accounting policies and practices. Segment information For Years Ended December 31, 2019 2018 2017 Revenue: Analog $ 10,223 $ 10,801 $ 9,900 Embedded Processing 2,943 3,554 3,498 Other 1,217 1,429 1,563 Total revenue $ 14,383 $ 15,784 $ 14,961 Operating profit: Analog $ 4,477 $ 5,109 $ 4,468 Embedded Processing 907 1,205 1,143 Other 339 399 472 Total operating profit $ 5,723 $ 6,713 $ 6,083 Geographic area information The following geographic area information includes revenue, based on product shipment destination, and property, plant and equipment, based on physical location. The geographic revenue information does not necessarily reflect end demand by geography because our products tend to be shipped to the locations where our customers manufacture their products. For Years Ended December 31, 2019 2018 2017 Revenue: United States $ 1,827 $ 2,288 $ 1,901 Asia (a) 8,650 9,240 8,824 Europe, Middle East and Africa 2,707 3,047 2,907 Japan 796 869 1,049 Rest of world 403 340 280 Total revenue $ 14,383 $ 15,784 $ 14,961 (a) Revenue from products shipped into China was $7.2 billion, $7.0 billion and $6.6 billion in 2019, 2018 and 2017, respectively, which includes shipments to customers that manufacture in China and then export end products to their customers around the world, as well as distributors that transship inventory through China to service other countries. December 31, 2019 2018 Property, plant and equipment: United States $ 1,998 $ 1,812 Asia (a) 1,046 1,116 Europe, Middle East and Africa 63 84 Japan 185 157 Rest of world 11 14 Total property, plant and equipment $ 3,303 $ 3,183 (a) Property, plant and equipment at our two sites in the Philippines was $394 million and $437 million as of December 31, 2019 and 2018, respectively. Property, plant and equipment at our sites in China was $304 million and $313 million as of December 31, 2019 and 2018, respectively. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies and Practices | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation and significant accounting policies and practices | Basis of presentation and significant accounting policies and practices Basis of presentation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The basis of these financial statements is comparable for all periods presented herein, except for the effects of adopting a new accounting standard in 2019 related to leases. The consolidated financial statements include the accounts of all subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. All dollar amounts in the financial statements and tables in these notes, except per-share amounts, are stated in millions of U.S. dollars unless otherwise indicated. We have reclassified certain amounts in the prior periods’ financial statements to conform to the 2019 presentation. The preparation of financial statements requires the use of estimates from which final results may vary. Significant accounting policies and practices Revenue recognition We generate revenue primarily from the sale of semiconductor products, either directly to a customer or to a distributor, or at the conclusion of a consignment process. We have a variety of types of contracts with our customers and distributors. In determining whether a contract exists, we evaluate the terms of the arrangement, the relationship with the customer or distributor and their ability to pay. We recognize revenue from sales of our products, including sales to our distributors, when control is transferred. Control is considered transferred when title and risk of loss pass, when the customer becomes obligated to pay and, where required, when the customer has accepted the products. This transfer generally occurs at a point in time upon shipment or delivery to the customer or distributor, depending upon the terms of the sales order. Payment for sales to customers and distributors is generally due on our standard commercial terms. For sales to distributors, payment is not contingent upon resale of the products. Revenue from sales of our products that are subject to inventory consignment agreements is recognized at a point in time, when the customer or distributor pulls product from consignment inventory that we store at designated locations. Delivery and transfer of control occur at that point, when title and risk of loss transfers and the customer or distributor becomes obligated to pay for the products pulled from inventory. Until the products are pulled for use or sale by the customer or distributor, we retain control over the products’ disposition, including the right to pull back or relocate the products. The revenue recognized is adjusted based on allowances, which are prepared on a portfolio basis using a most likely amount methodology based on analysis of historical data and contractual terms. These allowances, which are not material, generally include adjustments for pricing arrangements, product returns and incentives. The length of time between invoicing and payment is not significant under any of our payment terms. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. In addition, we record allowances for accounts receivable that we estimate may not be collected. We monitor collectability of accounts receivable primarily through review of accounts receivable aging. When collection is at risk, we assess the impact on amounts recorded for bad debts and, if necessary, record a charge in the period such determination is made. We recognize shipping fees, if any, received from customers in revenue. We include the related shipping and handling costs in cost of revenue. The majority of our customers pay these fees directly to third parties. Advertising costs We expense advertising and other promotional costs as incurred. This expense was $30 million, $34 million and $39 million in 2019, 2018 and 2017, respectively. Income taxes We account for income taxes using an asset and liability approach. We record the amount of taxes payable or refundable for the current year and the deferred tax assets and liabilities for future tax consequences of events that have been recognized in the financial statements or tax returns. We record a valuation allowance when it is more likely than not that some or all of the deferred tax assets will not be realized. Other assessed taxes Some transactions require us to collect taxes such as sales, value-added and excise taxes from our customers. These transactions are presented in our Consolidated Statements of Income on a net (excluded from revenue) basis. Leases We determine if an arrangement is a lease at inception. Leases are included in other long-term assets, accrued expenses and other liabilities, and other long-term liabilities on our Consolidated Balance Sheets. Lease assets represent our right to use underlying assets for the lease term, and lease liabilities represent our obligations to make lease payments over the lease term. On the commencement date, leases are evaluated for classification, and assets and liabilities are recognized based on the present value of lease payments over the lease term. We use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments. Operating lease expense is generally recognized on a straight-line basis over the lease term. Our lease values include options to extend or not to terminate the lease when it is reasonably certain that we will exercise such options. We have agreements with lease and non-lease components, which are accounted for as a single lease component. Leases with an initial lease term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Earnings per share (EPS) We use the two-class method for calculating EPS because the restricted stock units (RSUs) we grant are participating securities containing non-forfeitable rights to receive dividend equivalents. Under the two-class method, a portion of net income is allocated to RSUs and excluded from the calculation of income allocated to common stock, as shown in the table below. Computation and reconciliation of earnings per common share are as follows (shares in millions): For Years Ended December 31, 2019 2018 2017 Net Income Shares EPS Net Income Shares EPS Net Income Shares EPS Basic EPS: Net income $ 5,017 $ 5,580 $ 3,682 Income allocated to RSUs (32) (43) (34) Income allocated to common stock $ 4,985 936 $ 5.33 $ 5,537 970 $ 5.71 $ 3,648 991 $ 3.68 Dilutive effect of stock compensation plans 16 20 21 Diluted EPS: Net income $ 5,017 $ 5,580 $ 3,682 Income allocated to RSUs (31) (42) (33) Income allocated to common stock $ 4,986 952 $ 5.24 $ 5,538 990 $ 5.59 $ 3,649 1,012 $ 3.61 Potentially dilutive securities representing 6 million, 4 million and 6 million shares of common stock that were outstanding in 2019, 2018 and 2017 respectively, were excluded from the computation of diluted earnings per common share during these periods because their effect would have been anti-dilutive. Investments We present investments on our Consolidated Balance Sheets as cash equivalents, short-term investments or long-term investments, which are detailed below. See Note 6 for additional information. • Cash equivalents and short-term investments – We consider investments in available-for-sale debt securities with maturities of 90 days or less from the date of our investment to be cash equivalents. We consider investments in available-for-sale debt securities with maturities beyond 90 days from the date of our investment as being available for use in current operations and include them in short-term investments. The primary objectives of our cash equivalent and short-term investment activities are to preserve capital and maintain liquidity while generating appropriate returns. • Long-term investments – Long-term investments consist of mutual funds, venture capital funds and non-marketable equity securities. Inventories Inventories are stated at the lower of cost or estimated net realizable value. Cost is generally computed on a currently adjusted standard cost basis, which approximates cost on a first-in first-out basis. Standard cost is based on the normal utilization of installed factory capacity. Cost associated with underutilization of capacity is expensed as incurred. Inventory held at consignment locations is included in our finished goods inventory. We review inventory quarterly for salability and obsolescence. A statistical allowance is provided for inventory considered unlikely to be sold. The statistical allowance is based on an analysis of historical disposal activity, historical customer shipments, as well as estimated future sales. A specific allowance for each material type will be carried if there is a significant event not captured by the statistical allowance. We write off inventory in the period in which disposal occurs. Property, plant and equipment; acquisition-related intangibles; and other capitalized costs Property, plant and equipment are stated at cost and depreciated over their estimated useful lives using the straight-line method. Our cost basis includes certain assets acquired in business combinations that were initially recorded at fair value as of the date of acquisition. Leasehold improvements are amortized using the straight-line method over the shorter of the remaining lease term or the estimated useful lives of the improvements. We amortize acquisition-related intangibles on a straight-line basis over the estimated economic life of the assets. Capitalized software licenses generally are amortized on a straight-line basis over the term of the license. Fully depreciated or amortized assets are written off against accumulated depreciation or amortization. Impairments of long-lived assets We regularly review whether facts or circumstances exist that indicate the carrying values of property, plant and equipment or other long-lived assets, including intangible assets, are impaired. We assess the recoverability of assets by comparing the projected undiscounted net cash flows associated with those assets to their respective carrying amounts. Any impairment charge is based on the excess of the carrying amount over the fair value of those assets. Fair value is determined by available market valuations, if applicable, or by discounted cash flows. Goodwill Goodwill is reviewed for impairment annually or more frequently if certain impairment indicators arise. We perform our annual goodwill impairment test as of October 1 for our reporting units, which compares the fair value for each reporting unit to its associated carrying value, including goodwill. See Note 7 for additional information. Foreign currency The functional currency for our non-U.S. subsidiaries is the U.S. dollar. Accounts recorded in currencies other than the U.S. dollar are remeasured into the functional currency. Current assets (except inventories), deferred taxes, other assets, current liabilities and long-term liabilities are remeasured at exchange rates in effect at the end of each reporting period. Property, plant and equipment with associated depreciation and inventories are valued at historical exchange rates. Revenue and expense accounts other than depreciation for each month are remeasured at the appropriate daily rate of exchange. Currency exchange gains and losses from remeasurement are credited or charged to OI&E. Derivatives and hedging We use derivative financial instruments to manage exposure to foreign exchange risk. These instruments are primarily forward foreign currency exchange contracts, which are used as economic hedges to reduce the earnings impact that exchange rate fluctuations may have on our non-U.S. dollar net balance sheet exposures. Gains and losses from changes in the fair value of these forward foreign currency exchange contracts are credited or charged to OI&E. We do not apply hedge accounting to our foreign currency derivative instruments. In connection with the issuance of long-term debt, we may use financial derivatives such as treasury-rate lock agreements that are recognized in AOCI and amortized over the life of the related debt. The results of these derivative transactions have not been material. We do not use derivatives for speculative or trading purposes. Changes in accounting standards – adopted standards for current period Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) We adopted ASU No. 2016-02, Leases (ASC 842) effective January 1, 2019, using the modified retrospective transition method applied to leases existing at, or entered into after, the adoption date. The reported results for 2019 reflect the application of the new accounting guidance, while the reported results for prior periods are not adjusted and continue to be reported in accordance with our historical accounting under ASC 840, Leases. In addition, we elected the package of practical expedients permitted under the transition guidance that allowed us to apply prior conclusions related to lease definition, classification and initial direct costs. The adoption of the new standard resulted in the recognition of $229 million of lease liabilities with corresponding lease assets as of January 1, 2019. The standard did not materially impact our results of operations and had no impact on cash flows. Other standards The following standards were also adopted: ASU Description Adopted Date ASU No. 2017-12 Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities January 1, 2019 ASU No. 2018-14 Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20): Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans January 1, 2019 Changes in accounting standards – standards not yet adopted ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This standard requires entities to use a current lifetime expected credit loss methodology to measure impairments of certain financial assets. Using this methodology will result in earlier recognition of losses than under the current incurred loss approach, which requires waiting to recognize a loss until it is probable of being incurred. Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses rather than as a reduction to the amortized cost basis of the securities. We are adopting this standard effective January 1, 2020, applying the guidance on a modified retrospective basis. In preparation for adoption of the standard, we have updated certain policies and related processes, but this standard will not have a material impact on our financial position or results of operations. Other standards We are evaluating the impact of the following standards, but we do not expect them to have a material impact on our financial position or results of operations. We are adopting these standards as of their effective dates. ASU Description Effective Date ASU No. 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement January 1, 2020 ASU No. 2018-15 Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract January 1, 2020 |
Stock Compensation
Stock Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock compensation | Stock compensation We have stock options outstanding to participants under long-term incentive plans. The option price per share may not be less than the fair market value of our common stock on the date of the grant. The options have a 10-year term, generally vest ratably over four years, and continue to vest after the option recipient retires. We also have RSUs outstanding to participants under long-term incentive plans. Each RSU represents the right to receive one share of TI common stock, issued on the vesting date, which is generally four years after the date of grant. RSUs continue to vest after the recipient retires. Holders of RSUs receive an annual cash payment equivalent to the dividends paid on our common stock. We have options and RSUs outstanding to non-employee directors under director compensation plans. The plans generally provide for annual grants of stock options and RSUs, a one-time grant of RSUs to each new non-employee director and the issuance of TI common stock upon the distribution of stock units credited to director deferred compensation accounts. We also have an employee stock purchase plan (ESPP) under which options are offered to all eligible employees in amounts based on a percentage of the employee’s compensation, subject to a cap. Under the plan, the option price per share is 85% of the fair market value on the exercise date. Total stock compensation expense recognized is as follows: For Years Ended December 31, 2019 2018 2017 COR $ 21 $ 25 $ 36 R&D 66 69 59 SG&A 130 138 147 Total $ 217 $ 232 $ 242 These amounts include expenses related to non-qualified stock options, RSUs and stock options offered under our ESPP and are net of estimated forfeitures. We recognize compensation expense for non-qualified stock options and RSUs on a straight-line basis over the minimum service period required for vesting of the award, adjusting for estimated forfeitures based on historical activity. Awards issued to employees who are retirement eligible or nearing retirement eligibility are expensed on an accelerated basis. Options issued under our ESPP are expensed over a three-month period. Fair-value methods and assumptions We account for all awards granted under our various stock compensation plans at fair value. We estimate the fair values for non-qualified stock options using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions: For Years Ended December 31, 2019 2018 2017 Weighted average grant date fair value, per share $ 22.08 $ 23.20 $ 16.49 Weighted average assumptions used: Expected volatility 26 % 23 % 24 % Expected lives (in years) 7.1 7.2 7.2 Risk-free interest rates 2.66 % 2.57 % 2.36 % Expected dividend yields 2.95 % 2.25 % 2.52 % We determine expected volatility on all options granted using available implied volatility rates. We believe that market-based measures of implied volatility are currently the best available indicators of the expected volatility used in these estimates. We determine expected lives of options based on the historical option exercise experience of our optionees using a rolling 10-year average. We believe the historical experience method is the best estimate of future exercise patterns currently available. Risk-free interest rates are determined using the implied yield currently available for zero-coupon U.S. government issues with a remaining term equal to the expected life of the options. Expected dividend yields are based on the annualized approved quarterly dividend rate and the current market price of our common stock at the time of grant. No assumption for a future dividend rate change is included unless there is an approved plan to change the dividend in the near term. The fair value per share of RSUs is determined based on the closing price of our common stock on the date of grant. Our ESPP is a discount-purchase plan and consequently the Black-Scholes-Merton option-pricing model is not used to determine the fair value per share of these awards. The fair value per share under this plan equals the amount of the discount. Long-term incentive and director compensation plans Stock option and RSU transactions under our long-term incentive and director compensation plans are as follows: Stock Options RSUs Shares Weighted Average Exercise Price per Share Shares Weighted Average Grant Date Fair Value per Share Outstanding grants, December 31, 2018 39,905,454 $ 56.10 7,305,543 $ 66.72 Granted 4,559,093 104.51 1,142,974 106.58 Stock options exercised/RSUs vested (11,529,174) 44.68 (2,370,762) 52.74 Forfeited and expired (441,429) 83.89 (179,955) 81.57 Outstanding grants, December 31, 2019 32,493,944 66.57 5,897,800 79.62 The weighted average grant date fair values per share of RSUs granted in 2019, 2018 and 2017 were $106.58, $110.05 and $79.52, respectively. In 2019, 2018 and 2017, the total grant date fair values of shares vested from RSU grants were $125 million, $123 million and $149 million, respectively. As of December 31, 2019, the number of shares remaining available for future issuance under these plans was 45,082,425. Summarized information about stock options outstanding as of December 31, 2019, is as follows: Stock Options Outstanding Options Exercisable Exercise Price Range Number Outstanding (Shares) Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price per Share Number Exercisable (Shares) Weighted Average Exercise Price per Share $ 23.05 to 127.35 32,493,944 5.9 $ 66.57 19,646,782 $ 50.82 In 2019, 2018 and 2017, the aggregate intrinsic values (i.e., the difference in the closing market price on the date of exercise and the exercise price paid by the optionee) of options exercised were $819 million, $561 million and $632 million, respectively. Summarized information as of December 31, 2019, about outstanding stock options that are vested and expected to vest, as well as stock options that are currently exercisable, is as follows: Outstanding Stock Options (Fully Vested and Expected to Vest) (a) Options Exercisable Number of outstanding (shares) 32,001,396 19,646,782 Weighted average remaining contractual life (in years) 5.8 4.6 Weighted average exercise price per share $ 66.03 $ 50.82 Intrinsic value (millions of dollars) $ 1,992 $ 1,522 (a) Includes effects of expected forfeitures. Excluding the effects of expected forfeitures, the aggregate intrinsic value of stock options outstanding was $2.01 billion. As of December 31, 2019, total future compensation related to equity awards not yet recognized in our Consolidated Statements of Income was $226 million, consisting of $98 million related to unvested stock options and $128 million related to unvested RSUs. The $226 million is expected to be recognized as follows: $113 million in 2020, $72 million in 2021, $37 million in 2022 and $4 million in 2023. Employee stock purchase plan Options outstanding under the ESPP as of December 31, 2019, had an exercise price equal to 85% of the fair market value of TI common stock on the date of automatic exercise. The automatic exercise occurred on January 2, 2020, resulting in an exercise price of $110.14 per share. Of the total outstanding options, none were exercisable as of December 31, 2019. ESPP transactions are as follows: Shares Exercise Price Outstanding grants, December 31, 2018 229,836 $ 80.29 Granted 742,819 102.34 Exercised (798,806) 94.30 Outstanding grants, December 31, 2019 173,849 110.14 The weighted average grant date fair values per share of options granted under the ESPP in 2019, 2018 and 2017 were $18.05, $15.43 and $12.99, respectively. The total intrinsic value of options exercised under these plans was $13 million in 2019, 2018 and 2017. As of December 31, 2019, the number of shares remaining available for future issuance under this plan was 33,812,282. Effect on shares outstanding and treasury shares Treasury shares were acquired in connection with the board-authorized stock repurchase program. As of December 31, 2019, $13.18 billion of stock repurchase authorizations remain, and no expiration date has been specified. Our current practice is to issue shares of common stock from treasury shares upon exercise of stock options, distribution of director deferred compensation and vesting of RSUs. The following table reflects the changes in our treasury shares: Stock Options RSUs Treasury Shares Balance, December 31, 2016 744,831,978 Repurchases 30,570,129 Shares used for: Stock options/RSUs (13,313,019) (4,419,464) Stock applied to taxes — 1,058,100 ESPP (1,065,757) — Director deferred stock units — — (4,750) Total issued (14,378,776) (3,361,364) (17,740,140) Balance, December 31, 2017 757,657,217 Repurchases 49,482,220 Shares used for: Stock options/RSUs (8,432,458) (2,769,994) Stock applied to taxes — 553,720 ESPP (819,878) — Director deferred stock units — — (5,181) Total issued (9,252,336) (2,216,274) (11,468,610) Balance, December 31, 2018 795,665,646 Repurchases 27,398,701 Shares used for: Stock options/RSUs (11,529,174) (2,370,762) Stock applied to taxes — 490,347 ESPP (798,806) — Director deferred stock units — — (71,571) Total issued (12,327,980) (1,880,415) (14,208,395) Balance, December 31, 2019 808,784,381 The effects on cash flows are as follows: For Years Ended December 31, 2019 2018 2017 Proceeds from common stock transactions (a) $ 539 $ 373 $ 483 Tax benefit realized from stock compensation $ 224 $ 179 $ 341 Reduction to deferred tax asset (49) (43) (91) Excess tax benefit for stock compensation $ 175 $ 136 $ 250 (a) Net of taxes paid for employee shares withheld of $52 million, $60 million and $83 million in 2019, 2018 and 2017, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes Income before income taxes is comprised of the following components: For Years Ended December 31, 2019 2018 2017 U.S. $ 4,915 $ 5,672 $ 5,130 Non-U.S. 813 1,014 950 Total $ 5,728 $ 6,686 $ 6,080 Provision for income taxes is comprised of the following components: For Years Ended December 31, 2019 2018 2017 Current Deferred Total Current Deferred Total Current Deferred Total U.S. federal $ 483 $ 25 $ 508 $ 979 $ (98) $ 881 $ 2,101 $ 51 $ 2,152 Non-U.S. 135 56 191 225 (8) 217 173 61 234 U.S. state 12 — 12 7 1 8 12 — 12 Total $ 630 $ 81 $ 711 $ 1,211 $ (105) $ 1,106 $ 2,286 $ 112 $ 2,398 Principal reconciling items from the U.S. statutory income tax rate to the effective tax rate (provision for income taxes as a percentage of income before income taxes) are as follows: For Years Ended December 31, 2019 2018 2017 U.S. statutory income tax rate 21.0 % 21.0 % 35.0 % U.S. tax benefit for foreign derived intangible income (4.9) (5.3) — U.S. excess tax benefit for stock compensation (3.1) (2.0) (4.1) U.S. R&D tax credit (1.4) (1.3) (1.1) Non-U.S. effective tax rates 0.3 0.1 (2.5) U.S. Tax Act transitional non-cash expense — 4.2 — U.S. Tax Act enactment-date effects and measurement period adjustments — (0.7) 12.7 U.S. tax benefit for manufacturing — — (1.6) Other 0.5 0.5 1.0 Effective tax rate 12.4 % 16.5 % 39.4 % The U.S. Tax Cuts and Jobs Act (the Tax Act) was enacted on December 22, 2017. The Tax Act reduces the U.S. statutory income tax rate from 35% to 21% and requires companies to pay a one-time tax on indefinitely reinvested earnings of certain non-U.S. subsidiaries that were previously tax deferred. We applied the guidance in Staff Accounting Bulletin No. 118 when accounting for the enactment-date effects of the Tax Act in 2017 and throughout 2018. As of December 31, 2018, we completed our accounting for the enactment-date income tax effects of the Tax Act. We booked a provisional amount of $773 million in 2017 and reduced our provisional amount by $44 million in 2018, for a net of $729 million. The earnings represented by non-cash operating assets, such as fixed assets and inventory, will continue to be permanently reinvested outside the United States. Provisions of the Tax Act, such as the one-time tax on indefinitely reinvested earnings and the global intangible low-taxed income (GILTI) tax for years beginning in 2018, eliminate any additional U.S. taxation resulting from repatriation of earnings of non-U.S. subsidiaries to the United States. Consequently, no U.S. tax provision has been made for the future remittance of these earnings. However, withholding or distribution taxes in certain non-U.S. jurisdictions will be incurred upon repatriation of available cash to the United States. A provision has been made for deferred taxes on these undistributed earnings to the extent that repatriation of the available cash to the United States is expected to result in a tax liability. As of December 31, 2019, we have no basis differences that would result in material unrecognized deferred tax liabilities. We have made an allowable policy election to account for the effects of GILTI as a component of income tax expense in the period in which the tax is incurred. The primary components of deferred tax assets and liabilities are as follows: December 31, 2019 2018 Deferred tax assets: Deferred loss and tax credit carryforwards $ 213 $ 247 Accrued expenses 113 129 Stock compensation 109 122 Inventories and related reserves 109 107 Retirement costs for defined benefit and retiree health care 49 80 Total deferred tax assets, before valuation allowance 593 685 Valuation allowance (180) (172) Total deferred tax assets, after valuation allowance 413 513 Deferred tax liabilities: Property, plant and equipment (95) (10) Acquisition-related intangibles and fair-value adjustments (82) (142) International earnings (62) (43) Other (55) (65) Total deferred tax liabilities (294) (260) Net deferred tax asset $ 119 $ 253 The deferred tax assets and liabilities based on tax jurisdictions are presented on our Consolidated Balance Sheets as follows: December 31, 2019 2018 Deferred tax assets $ 197 $ 295 Deferred tax liabilities (78) (42) Net deferred tax asset $ 119 $ 253 We make an ongoing assessment regarding the realization of U.S. and non-U.S. deferred tax assets. This assessment is based on our evaluation of relevant criteria, including the existence of deferred tax liabilities that can be used to absorb deferred tax assets, taxable income in prior carryback years and expectations for future taxable income. Valuation allowances increased by $8 million, $7 million and $37 million in 2019, 2018 and 2017, respectively. These changes had no impact to net income in 2019 or 2018. We have U.S. and non-U.S. tax loss carryforwards of approximately $6 million, none of which will expire before the year 2029. Cash payments made for income taxes, net of refunds, were $570 million, $705 million and $1.80 billion in 2019, 2018 and 2017, respectively. Uncertain tax positions We operate in a number of tax jurisdictions, and our income tax returns are subject to examination by tax authorities in those jurisdictions who may challenge any item on these tax returns. Because the matters challenged by authorities are typically complex, their ultimate outcome is uncertain. Before any benefit can be recorded in our financial statements, we must determine that it is “more likely than not” that a tax position will be sustained by the appropriate tax authorities. We recognize accrued interest related to uncertain tax positions and penalties as components of OI&E. The changes in the total amounts of uncertain tax positions are as follows: 2019 2018 2017 Balance, January 1 $ 286 $ 300 $ 243 Additions based on tax positions related to the current year 3 3 17 Additions for tax positions of prior years 63 1 42 Reductions for tax positions of prior years (41) — (1) Settlements with tax authorities (8) (18) (1) Balance, December 31 $ 303 $ 286 $ 300 Interest income (expense) recognized in the year ended December 31 $ 9 $ (15) $ (19) Interest payable as of December 31 $ 44 $ 49 $ 38 The liability for uncertain tax positions is a component of other long-term liabilities on our Consolidated Balance Sheets. All of the $303 million and $286 million liabilities for uncertain tax positions as of December 31, 2019 and 2018, respectively, are comprised of positions that, if recognized, would lower the effective tax rate. If these liabilities are ultimately realized, $2 million and $30 million of existing deferred tax assets in 2019 and 2018, respectively, would also be realized. It is reasonably possible that the $303 million liability as of December 31, 2019, could decrease by up to $249 million in 2020 for the resolution of a tax depreciation-related position. As of December 31, 2019, the statute of limitations remains open for U.S. federal tax returns for 2013 and following years. Audit activities related to our U.S. federal tax returns through 2012 have been completed except for certain pending tax treaty procedures for relief from double taxation. The procedures for relief from double taxation pertain to U.S. federal tax returns for the years 2007 through 2012. The audit of the U.S. federal tax returns for 2013 through 2015 is underway. In non-U.S. jurisdictions, the years open to audit represent the years still open under the statute of limitations. With respect to major jurisdictions outside the United States, our subsidiaries are no longer subject to income tax audits for years before 2007. |
Financial Instruments and Risk
Financial Instruments and Risk Concentration | 12 Months Ended |
Dec. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Financial instruments and risk concentration | Financial instruments and risk concentration Financial instruments We hold derivative financial instruments such as forward foreign currency exchange contracts, the fair value of which was not material as of December 31, 2019. Our forward foreign currency exchange contracts outstanding as of December 31, 2019, had a notional value of $458 million to hedge our non-U.S. dollar net balance sheet exposures, including $136 million to sell Japanese yen, $106 million to sell Indian rupees and $74 million to sell British pounds. Our investments in cash equivalents, short-term investments and certain long-term investments, as well as our deferred compensation liabilities, are carried at fair value. Our postretirement plan assets are carried at fair value or net asset value per share. The carrying values for other current financial assets and liabilities, such as accounts receivable and accounts payable, approximate fair value due to the short maturity of such instruments. As of December 31, 2019, the carrying value of long-term debt, including the current portion, was $5.80 billion, and the estimated fair value was $6.29 billion. The estimated fair value is measured using broker-dealer quotes, which are Level 2 inputs. See Note 6 for a description of fair value and the definition of Level 2 inputs. Risk concentration We are subject to counterparty risks from financial institutions, customers and issuers of debt securities. Financial instruments that could subject us to concentrations of credit risk are primarily cash deposits, cash equivalents, short-term investments and accounts receivable. To manage our credit risk exposure, we place cash investments in investment-grade debt securities and limit the amount of credit exposure to any one issuer. We also limit counterparties on cash deposits and financial derivative contracts to financial institutions with investment-grade ratings. Concentrations of credit risk with respect to accounts receivable are limited due to our large number of customers and their dispersion across different industries and geographic areas. We maintain allowances for expected returns, disputes, adjustments, incentives and collectability. These allowances are deducted from accounts receivable on our Consolidated Balance Sheets. Accounts receivable allowances changed to reflect amounts charged (credited) to operating results by ($11) million, $11 million and ($9) million in 2019, 2018 and 2017, respectively. Major customer No end customer accounted for 10% or more of revenue in 2019, 2018 or 2017. |
Valuation of Debt and Equity In
Valuation of Debt and Equity Investments and Certain Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Valuation of debt and equity investments and certain liabilities | Valuation of debt and equity investments and certain liabilities Debt and equity investments measured at fair value Available-for-sale debt investments and trading securities are stated at fair value, which is generally based on market prices or broker quotes. See Fair-value considerations below. Unrealized gains and losses from available-for-sale debt securities are recorded as an increase or decrease, net of taxes, in AOCI on our Consolidated Balance Sheets. Other-than-temporary impairments on available-for-sale debt securities are recorded in OI&E in our Consolidated Statements of Income. We classify certain mutual funds as trading securities. These mutual funds hold a variety of debt and equity investments intended to generate returns that offset changes in certain deferred compensation liabilities. We record changes in the fair value of these mutual funds and the related deferred compensation liabilities in SG&A. Other equity investments Our other investments include equity-method investments and non-marketable equity investments, which are not measured at fair value. These investments consist of interests in venture capital funds and other non-marketable equity securities. Gains and losses from equity-method investments are recognized in OI&E based on our ownership share of the investee’s financial results. Non-marketable equity securities are measured at cost with adjustments for observable changes in price or impairments. Gains and losses on non-marketable equity investments are recognized in OI&E. Details of our investments are as follows: December 31, 2019 December 31, 2018 Cash and Cash Equivalents Short-Term Investments Long-Term Investments Cash and Cash Equivalents Short-Term Investments Long-Term Investments Measured at fair value: Available-for-sale debt securities: Money market funds $ 1,213 $ — $ — $ 747 $ — $ — Corporate obligations 174 1,216 — 473 748 — U.S. government agency and Treasury securities 604 1,734 — 988 1,047 — Trading securities: Mutual funds — — 272 — — 226 Total 1,991 2,950 272 2,208 1,795 226 Other measurement basis: Equity-method investments — — 24 — — 21 Non-marketable equity investments — — 4 — — 4 Cash on hand 446 — — 230 — — Total $ 2,437 $ 2,950 $ 300 $ 2,438 $ 1,795 $ 251 As of December 31, 2019 and 2018, unrealized gains and losses associated with our available-for-sale investments were not material. We did not recognize any credit losses related to available-for-sale investments in 2019, 2018 or 2017. In 2019, 2018 and 2017, the proceeds from sales, redemptions and maturities of short-term available-for-sale investments were $2.31 billion, $6.71 billion and $4.10 billion, respectively. Gross realized gains and losses from these sales were not material. The following table presents the aggregate maturities of our available-for-sale debt investments as of December 31, 2019: Fair Value One year or less $ 4,921 One to two years 20 There were no other-than-temporary declines and impairments in the values of our debt investments in 2019, 2018 or 2017. In 2019, 2018 and 2017, net gains and losses associated with our equity investments were $32 million, $5 million and $4 million, respectively. These amounts include realized gains of $29 million, $11 million and $6 million on equity investments sold during 2019, 2018 and 2017, respectively. Fair-value considerations We measure and report certain financial assets and liabilities at fair value on a recurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The three-level hierarchy described below indicates the extent and level of judgment used to estimate fair-value measurements. • Level 1 – Uses unadjusted quoted prices that are available in active markets for identical assets or liabilities as of the reporting date. • Level 2 – Uses inputs other than Level 1 that are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data. We utilize a third-party data service to provide Level 2 valuations. We verify these valuations for reasonableness relative to unadjusted quotes obtained from brokers or dealers based on observable prices for similar assets in active markets. • Level 3 – Uses inputs that are unobservable, supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models that utilize management estimates of market participant assumptions. As of December 31, 2019 and 2018, we had no Level 3 assets or liabilities. The following are our assets and liabilities that were accounted for at fair value on a recurring basis. These tables do not include cash on hand, assets held by our postretirement plans, or assets and liabilities that are measured at historical cost or any basis other than fair value. December 31, 2019 December 31, 2018 Level 1 Level 2 Total Level 1 Level 2 Total Assets: Money market funds $ 1,213 $ — $ 1,213 $ 747 $ — $ 747 Corporate obligations — 1,390 1,390 — 1,221 1,221 U.S. government agency and Treasury securities 2,338 — 2,338 2,035 — 2,035 Mutual funds 272 — 272 226 — 226 Total assets $ 3,823 $ 1,390 $ 5,213 $ 3,008 $ 1,221 $ 4,229 Liabilities: Deferred compensation $ 298 $ — $ 298 $ 246 $ — $ 246 Total liabilities $ 298 $ — $ 298 $ 246 $ — $ 246 |
Goodwill and Acquisition-Relate
Goodwill and Acquisition-Related Intangibles | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and acquisition-related intangibles | Goodwill and acquisition-related intangibles Goodwill by segment as of December 31, 2019 and 2018, is as follows: Goodwill Analog $ 4,158 Embedded Processing 172 Other 32 Total $ 4,362 We perform our annual goodwill impairment test as of October 1 and determine whether the fair value of each of our reporting units is in excess of its carrying value. Determination of fair value is based upon management estimates and judgment, using unobservable inputs in discounted cash flow models to calculate the fair value of each reporting unit. These unobservable inputs are considered Level 3 measurements, as described in Note 6. In 2019, 2018 and 2017, we determined no impairment was indicated. The components of acquisition-related intangibles are as follows: December 31, 2019 December 31, 2018 Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Developed technology 7 – 10 $ 2,000 $ 1,660 $ 340 $ 2,125 $ 1,573 $ 552 Customer relationships 8 — — — 810 734 76 Total $ 2,000 $ 1,660 $ 340 $ 2,935 $ 2,307 $ 628 Acquisition charges Acquisition charges represent the ongoing amortization of intangible assets resulting from the acquisition of National Semiconductor Corporation. These amounts are included in Other for segment reporting purposes, consistent with how management measures the performance of its segments. Amortization of acquisition-related intangibles was $288 million in 2019 and $318 million in 2018 and 2017. Fully amortized assets are written off against accumulated amortization. The remaining estimated amortization is $198 million in 2020 and $142 million in 2021. |
Postretirement Benefit Plans
Postretirement Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Postretirement benefit plans | Postretirement benefit plans Plan descriptions We have various employee retirement plans, including defined contribution, defined benefit and retiree health care benefit plans. For qualifying employees, we offer deferred compensation arrangements. U.S. retirement plans Our principal retirement plans in the United States are a defined contribution plan; an enhanced defined contribution plan; and qualified and non-qualified defined benefit pension plans. The defined benefit plans were closed to new participants in 1997, and then current participants were allowed to make a one-time election to continue accruing a benefit in the plans or to cease accruing a benefit and instead to participate in the enhanced defined contribution plan described below. Both defined contribution plans offer an employer-matching savings option that allows employees to make pretax and post-tax contributions to various investment choices. Employees who elected to continue accruing a benefit in the qualified defined benefit pension plans may also participate in the defined contribution plan, where employer-matching contributions are provided for up to 2% of the employee’s annual eligible earnings. Employees who elected not to continue accruing a benefit in the defined benefit pension plans, and employees hired after November 1997 and through December 31, 2003, may participate in the enhanced defined contribution plan. This plan provides for a fixed employer contribution of 2% of the employee’s annual eligible earnings, plus an employer-matching contribution of up to 4% of the employee’s annual eligible earnings. Employees hired after December 31, 2003, do not receive the fixed employer contribution of 2% of the employee’s annual eligible earnings. As of December 31, 2019 and 2018, as a result of employees’ elections, TI’s U.S. defined contribution plans held shares of TI common stock totaling 8 million shares and 9 million shares valued at $988 million and $821 million, respectively. Dividends paid on these shares in 2019 and 2018 were $26 million and $24 million, respectively. Effective April 1, 2016, the TI common stock fund was frozen to new contributions or transfers into the fund. Our aggregate expense for the U.S. defined contribution plans was $61 million in 2019, 2018 and 2017. The defined benefit pension plans include employees still accruing benefits, as well as employees and participants who no longer accrue service-related benefits, but instead, may participate in the enhanced defined contribution plan. Benefits under the qualified defined benefit pension plan are determined using a formula based on years of service and the highest five U.S. retiree health care benefit plan U.S. employees who meet eligibility requirements are offered medical coverage during retirement. We make a contribution toward the cost of those retiree medical benefits for certain retirees and their dependents. The contribution rates are based upon various factors, the most important of which are an employee’s date of hire, date of retirement, years of service and eligibility for Medicare benefits. The balance of the cost is borne by the plan’s participants. Employees hired after January 1, 2001, are responsible for the full cost of their medical benefits during retirement. Non-U.S. retirement plans We provide retirement coverage for non-U.S. employees, as required by local laws or to the extent we deem appropriate, through a number of defined benefit and defined contribution plans. Retirement benefits are generally based on an employee’s years of service and compensation. Funding requirements are determined on an individual country and plan basis and are subject to local country practices and market circumstances. As of December 31, 2019 and 2018, as a result of employees’ elections, TI’s non-U.S. defined contribution plans held TI common stock valued at $28 million and $23 million, respectively. Dividends paid on these shares of TI common stock in 2019 and 2018 were not material. Effects on our Consolidated Statements of Income and Balance Sheets Expense related to defined benefit and retiree health care benefit plans is as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2017 2019 2018 2017 2019 2018 2017 Service cost $ 18 $ 19 $ 22 $ 3 $ 5 $ 5 $ 31 $ 36 $ 37 Interest cost 38 35 42 14 15 17 43 45 44 Expected return on plan assets (41) (42) (41) (14) (15) (17) (86) (67) (62) Amortization of prior service cost (credit) — — — (1) (3) (4) 1 (1) (2) Recognized net actuarial loss 9 17 14 — 2 3 29 20 28 Net periodic benefit costs 24 29 37 2 4 4 18 33 45 Settlement losses 10 23 36 — — — 3 3 2 Total, including other postretirement losses $ 34 $ 52 $ 73 $ 2 $ 4 $ 4 $ 21 $ 36 $ 47 All defined benefit and retiree health care benefit plan expense components other than service cost are recognized in OI&E in our Consolidated Statements of Income. Service cost is recognized within operating profit. For the U.S. qualified pension and retiree health care plans, the expected return on plan assets component of net periodic benefit cost is based upon a market-related value of assets. In accordance with U.S. GAAP, the market-related value of assets is the fair value adjusted by a smoothing technique whereby certain gains and losses are phased in over a period of three years. Changes in the benefit obligations and plan assets for defined benefit and retiree health care benefit plans are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2019 2018 2019 2018 Change in plan benefit obligation Benefit obligation at beginning of year: $ 874 $ 998 $ 361 $ 414 $ 2,411 $ 2,469 Service cost 18 19 3 5 31 36 Interest cost 38 35 14 15 43 45 Participant contributions — — 13 11 7 7 Benefits paid (11) (10) (41) (41) (103) (87) Settlements (66) (100) — — (12) (16) Curtailments — — — — (1) — Actuarial loss (gain) 107 (68) 9 (43) 193 6 Plan amendments — — — — — 7 Effects of exchange rate changes — — — — 12 (56) Benefit obligation at end of year $ 960 $ 874 $ 359 $ 361 $ 2,581 $ 2,411 Change in plan assets Fair value of plan assets at beginning of year: $ 869 $ 995 $ 330 $ 394 $ 2,410 $ 2,593 Actual return on plan assets 185 (56) 53 (12) 337 (52) Employer contributions (qualified plans) — 20 1 1 9 19 Employer contributions (non-qualified plans) 10 20 — — — — Participant contributions — — 13 11 7 7 Benefits paid (11) (10) (41) (41) (103) (87) Settlements (66) (100) — — (12) (16) Effects of exchange rate changes — — — — 13 (54) Other — — — (23) — — Fair value of plan assets at end of year $ 987 $ 869 $ 356 $ 330 $ 2,661 $ 2,410 Funded status at end of year $ 27 $ (5) $ (3) $ (31) $ 80 $ (1) The actuarial loss (gain) for all pension plans was primarily related to a change in the discount rate used to measure the benefit obligations of those plans in 2019 and 2018. Amounts recognized on our Consolidated Balance Sheets as of December 31, are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit Total 2019 Overfunded retirement plans $ 73 $ — $ 145 $ 218 Accrued expenses and other liabilities & other long-term liabilities (17) — (4) (21) Underfunded retirement plans (29) (3) (61) (93) Funded status at end of 2019 $ 27 $ (3) $ 80 $ 104 2018 Overfunded retirement plans $ 40 $ — $ 52 $ 92 Accrued expenses and other liabilities & other long-term liabilities (8) — (3) (11) Underfunded retirement plans (37) (31) (50) (118) Funded status at end of 2018 $ (5) $ (31) $ (1) $ (37) Contributions to the plans meet or exceed all minimum funding requirements. We expect to contribute about $20 million to our retirement benefit plans in 2020. Accumulated benefit obligations, which are generally less than the projected benefit obligations as they exclude the impact of future salary increases, were $878 million and $793 million as of December 31, 2019 and 2018, respectively, for the U.S. defined benefit plans, and $2.46 billion and $2.29 billion as of December 31, 2019 and 2018, respectively, for the non-U.S. defined benefit plans. The change in AOCI is as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit Total Net Actuarial Loss Net Actuarial Loss Prior Service Credit Net Actuarial Loss Prior Service Credit Net Actuarial Loss Prior Service Credit AOCI balance, net of taxes, December 31, 2018 $ 135 $ 21 $ (5) $ 317 $ 3 $ 473 $ (2) Changes in AOCI by category: Adjustments (36) (31) — (58) — (125) — Recognized within net income (19) — 1 (32) (1) (51) — Tax effect 11 7 — 32 — 50 — Total change to AOCI (44) (24) 1 (58) (1) (126) — AOCI balance, net of taxes, December 31, 2019 $ 91 $ (3) $ (4) $ 259 $ 2 $ 347 $ (2) Information on plan assets We report and measure the plan assets of our defined benefit pension and other postretirement plans at fair value. The tables below set forth the fair value of our plan assets using the same three-level hierarchy of fair-value inputs described in Note 6. December 31, 2019 Level 1 Level 2 Other (a) Total Assets of U.S. defined benefit plan: Fixed income securities and cash equivalents $ — $ — $ 640 $ 640 Equity securities — — 347 347 Total $ — $ — $ 987 $ 987 Assets of U.S. retiree health care plan: Fixed income securities and cash equivalents $ 62 $ — $ 168 $ 230 Equity securities — — 126 126 Total $ 62 $ — $ 294 $ 356 Assets of non-U.S. defined benefit plans: Fixed income securities and cash equivalents $ 59 $ 126 $ 1,762 $ 1,947 Equity securities 41 2 671 714 Total $ 100 $ 128 $ 2,433 $ 2,661 (a) Consists of bond index and equity index funds, measured at net asset value per share, as well as cash equivalents. December 31, 2018 Level 1 Level 2 Other (a) Total Assets of U.S. defined benefit plan: Fixed income securities and cash equivalents $ — $ — $ 563 $ 563 Equity securities — — 306 306 Total $ — $ — $ 869 $ 869 Assets of U.S. retiree health care plan: Fixed income securities and cash equivalents $ 59 $ — $ 155 $ 214 Equity securities — — 116 116 Total $ 59 $ — $ 271 $ 330 Assets of non-U.S. defined benefit plans: Fixed income securities and cash equivalents $ 47 $ 139 $ 1,602 $ 1,788 Equity securities 33 1 588 622 Total $ 80 $ 140 $ 2,190 $ 2,410 (a) Consists of bond index and equity index funds, measured at net asset value per share, as well as cash equivalents. The investments in our major benefit plans largely consist of low-cost, broad-market index funds to mitigate risks of concentration within market sectors. Our investment policy is designed to better match the interest rate sensitivity of the plan assets and liabilities. The appropriate mix of equity and bond investments is determined primarily through the use of detailed asset-liability modeling studies that look to balance the impact of changes in the discount rate against the need to provide asset growth to cover future service cost. Most of our plans around the world have a greater proportion of fixed income securities with return characteristics that are more closely aligned with changes in the liabilities caused by discount rate volatility. Assumptions and investment policies U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2019 2018 2019 2018 Weighted average assumptions used to determine benefit obligations: Discount rate 3.62% 4.37% 3.63% 4.30% 1.46% 1.85% Long-term pay progression 3.30% 3.30% n/a n/a 3.06% 2.96% Weighted average assumptions used to determine net periodic benefit cost: Discount rate 4.35% 3.77% 4.30% 3.63% 1.85% 1.84% Long-term rate of return on plan assets 4.90% 4.80% 4.40% 4.10% 3.62% 2.58% Long-term pay progression 3.30% 3.30% n/a n/a 3.03% 2.96% We utilize a variety of methods to select an appropriate discount rate depending on the depth of the corporate bond market in the country in which the benefit plan operates. In the United States, we use a settlement approach whereby a portfolio of bonds is selected from the universe of actively traded high-quality U.S. corporate bonds. The selected portfolio is designed to provide cash flows sufficient to pay the plan’s expected benefit payments when due. The resulting discount rate reflects the rate of return of the selected portfolio of bonds. For our non-U.S. locations with a sufficient number of actively traded high-quality bonds, an analysis is performed in which the projected cash flows from the defined benefit plans are discounted against a yield curve constructed with an appropriate universe of high-quality corporate bonds available in each country. In this manner, a present value is developed. The discount rate selected is the single equivalent rate that produces the same present value. For countries that lack a sufficient corporate bond market, a government bond index adjusted for an appropriate risk premium is used to establish the discount rate. Assumptions for the expected long-term rate of return on plan assets are based on future expectations for returns for each asset class and the effect of periodic target asset allocation rebalancing. We adjust the results for the payment of reasonable expenses of the plan from plan assets. We believe our assumptions are appropriate based on the investment mix and long-term nature of the plans’ investments. Assumptions used for the non-U.S. defined benefit plans reflect the different economic environments within the various countries. The target allocation ranges for the plans that hold a substantial majority of the defined benefit assets are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit Fixed income securities and cash equivalents 65% 65% 60% – 100% Equity securities 35% 35% 0% – 40% We rebalance the plans’ investments when they are outside the target allocation ranges. Weighted average asset allocations as of December 31 are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2019 2018 2019 2018 Fixed income securities and cash equivalents 65% 65% 65% 65% 73% 74% Equity securities 35% 35% 35% 35% 27% 26% None of the plan assets related to the defined benefit pension plans and retiree health care benefit plan are directly invested in TI common stock. The following assumed future benefit payments to plan participants in the next 10 years are used to measure our benefit obligations. Almost all of the payments, which may vary significantly from these assumptions, will be made from plan assets and not from company assets. 2020 2021 2022 2023 2024 2025 – 2029 U.S. Defined Benefit $ 99 $ 118 $ 85 $ 90 $ 87 $ 441 U.S. Retiree Health Care 32 30 29 27 26 115 Non-U.S. Defined Benefit 95 96 99 100 104 542 Assumed health care cost trend rates for the U.S. retiree health care benefit plan as of December 31 are as follows: 2019 2018 Assumed health care cost trend rate for next year 7.00% 7.25% Ultimate trend rate 5.00% 5.00% Year in which ultimate trend rate is reached 2028 2028 Deferred compensation plans We have deferred compensation plans that allow U.S. employees whose base salary and management responsibility exceed a certain level to defer receipt of a portion of their cash compensation. Payments under these plans are made based on the participant’s distribution election and plan balance. Participants can earn a return on their deferred compensation based on notional investments in the same investment funds that are offered in our defined contribution plans. As of December 31, 2019, our liability to participants of the deferred compensation plans was $298 million and is recorded in other long-term liabilities on our Consolidated Balance Sheets. This amount reflects the accumulated participant deferrals and earnings thereon as of that date. As of December 31, 2019, we held $272 million in mutual funds related to these plans that are recorded in long-term investments on our Consolidated Balance Sheets, and serve as an economic hedge against changes in fair values of our other deferred compensation liabilities. We record changes in the fair value of the liability and the related investment in SG&A as discussed in Note 6. |
Debt and Lines of Credit
Debt and Lines of Credit | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt and lines of credit | Debt and lines of credit Short-term borrowings We maintain a line of credit to support commercial paper borrowings, if any, and to provide additional liquidity through bank loans. As of December 31, 2019, we had a variable-rate revolving credit facility from a consortium of investment-grade banks that allows us to borrow up to $2 billion until March 2024. The interest rate on borrowings under this credit facility, if drawn, is indexed to the applicable London Interbank Offered Rate (LIBOR). As of December 31, 2019, our credit facility was undrawn, and we had no commercial paper outstanding. Long-term debt We retired $750 million of maturing debt in August 2019. In March 2019, we issued a principal amount of $750 million of fixed-rate, long-term debt due in 2039. We incurred $7 million of issuance and other related costs. The proceeds of the offering were $743 million, net of the original issuance discount, and were used for general corporate purposes. In September 2019, we issued a principal amount of $750 million of fixed-rate, long-term debt due in 2029. We incurred $5 million of issuance and other related costs. The proceeds of the offering were $748 million, net of the original issuance discount, and were used for general corporate purposes. We retired $500 million of maturing debt in May 2018. In the second quarter of 2018, we issued an aggregate principal amount of $1.5 billion of fixed-rate, long-term debt due in 2048, comprised of the issuance of $1.3 billion in May 2018 and an additional $200 million in June 2018. We incurred $16 million of issuance and other related costs. The proceeds of the offering were $1.5 billion, net of the original issuance discount and premium, and were used for general corporate purposes. We retired $250 million of maturing debt in March 2017 and another $375 million in June 2017. In May 2017, we issued an aggregate principal amount of $600 million of fixed-rate, long-term debt. The offering consisted of the reissuance of $300 million of 2.75% notes due in 2021 at a premium and the issuance of $300 million of 2.625% notes due in 2024 at a discount. We incurred $3 million of issuance and other related costs. The proceeds of the offerings were $605 million, net of the original issuance discount and premium, and were used for the repayment of maturing debt and general corporate purposes. In November 2017, we issued a principal amount of $500 million of fixed-rate, long-term debt due in 2027. We incurred $3 million of issuance and other related costs. The proceeds of the offering were $494 million, net of the original issuance discount, and were used for general corporate purposes. Long-term debt outstanding is as follows: December 31, 2019 2018 Notes due 2019 at 1.65% $ — $ 750 Notes due 2020 at 1.75% 500 500 Notes due 2021 at 2.75% 550 550 Notes due 2022 at 1.85% 500 500 Notes due 2023 at 2.25% 500 500 Notes due 2024 at 2.625% 300 300 Notes due 2027 at 2.90% 500 500 Notes due 2029 at 2.25% 750 — Notes due 2039 at 3.875% 750 — Notes due 2048 at 4.15% 1,500 1,500 Total debt 5,850 5,100 Net unamortized discounts, premiums and issuance costs (47) (32) Total debt, including net unamortized discounts, premiums and issuance costs 5,803 5,068 Current portion of long-term debt (500) (749) Long-term debt $ 5,303 $ 4,319 Interest and debt expense was $170 million, $125 million and $78 million in 2019, 2018 and 2017, respectively. This was net of the amortized discounts, premiums and issuance costs. Cash payments for interest on long-term debt were $156 million, $114 million and $75 million in 2019, 2018 and 2017, respectively. Capitalized interest was not material. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases We conduct certain operations in leased facilities and also lease a portion of our data processing and other equipment. In addition, certain long-term supply agreements to purchase industrial gases are accounted for as operating leases. Lease agreements frequently include renewal provisions and require us to pay real estate taxes, insurance and maintenance costs. Our leases are included as a component of the following balance sheet lines: December 31, 2019 Other long-term assets $ 337 Accrued expenses and other liabilities $ 73 Other long-term liabilities 259 Details of our operating leases are as follows: For Year Ended 2019 Lease cost related to lease liabilities $ 66 Variable lease cost 41 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for lease cost $ 60 Lease assets obtained in exchange for new lease liabilities $ 167 Weighted average remaining lease term 8.2 years Weighted average discount rate 3.37 % As of December 31, 2019, we had committed to make the following minimum payments under our non-cancellable operating leases: 2020 2021 2022 2023 2024 Thereafter Total Lease payments $ 75 $ 63 $ 51 $ 38 $ 28 $ 131 $ 386 Imputed lease interest (54) Total lease liabilities $ 332 As of December 31, 2018, we had committed to make the following minimum payments under our non-cancellable operating leases, as reported under ASC 840: 2019 2020 2021 2022 2023 Thereafter Total Operating leases $ 56 $ 46 $ 36 $ 29 $ 18 $ 39 $ 224 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies Purchase commitments Our purchase commitments include payments for software licenses and contractual arrangements with suppliers when there is a fixed, non-cancellable payment schedule or when minimum payments are due with a reduced delivery schedule. As of December 31, 2019, we had committed to make the following minimum payments under our purchase commitments: 2020 2021 2022 2023 2024 Thereafter Total Purchase commitments $ 452 $ 286 $ 121 $ 70 $ 27 $ 109 $ 1,065 Indemnification guarantees We routinely sell products with an intellectual property indemnification included in the terms of sale. Historically, we have had only minimal, infrequent losses associated with these indemnities. Consequently, we cannot reasonably estimate any future liabilities that may result. Warranty costs/product liabilities We accrue for known product-related claims if a loss is probable and can be reasonably estimated. During the periods presented, there have been no material accruals or payments regarding product warranty or product liability. Historically, we have experienced a low rate of payments on product claims. Although we cannot predict the likelihood or amount of any future claims, we do not believe they will have a material adverse effect on our financial condition, results of operations or liquidity. Our stated warranties for semiconductor products obligate us to repair, replace or credit the purchase price of a covered product back to the buyer. Product claim consideration may exceed the price of our products. General We are subject to various legal and administrative proceedings. Although it is not possible to predict the outcome of these matters, we believe that the results of these proceedings will not have a material adverse effect on our financial condition, results of operations or liquidity. |
Supplemental Financial Informat
Supplemental Financial Information | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Text Block Supplement [Abstract] | |
Supplemental financial information | Supplemental financial information Restructuring charges/other Restructuring charges/other are included in Other for segment reporting purposes and are comprised of the following components: For Years Ended December 31, 2019 2018 2017 Restructuring charges (a) $ (15) $ 6 $ 11 Gains on sales of assets (21) (3) — Restructuring charges/other $ (36) $ 3 $ 11 (a) Includes severance and benefits, accelerated depreciation, changes in estimates or other exit costs. Changes in accrued restructuring balances 2019 2018 2017 Balance, January 1 $ 28 $ 29 $ 40 Restructuring charges (15) 6 11 Non-cash items (a) — (3) (1) Payments (13) (4) (21) Balance, December 31 $ — $ 28 $ 29 (a) Reflects charges for impacts of accelerated depreciation and changes in exchange rates. The restructuring accrual balances are reported as a component of either accrued expenses and other liabilities or other long-term liabilities on our Consolidated Balance Sheets, depending on the expected timing of payment. In April 2019, we sold our manufacturing facility in Greenock, Scotland. In January 2020, we announced a multiyear plan to close our two remaining factories with 150-millimeter production, which are more than 50 years old and located in Sherman and Dallas, Texas. Production will be transitioned from these sites to our more advanced and cost-effective 300-millimeter wafer fabrication facilities in North Texas. We expect this transition to be completed in the next three Other income (expense), net (OI&E) For Years Ended December 31, 2019 2018 2017 Other income (a) $ 197 $ 150 $ 163 Other expense (b) (22) (52) (88) Total $ 175 $ 98 $ 75 (a) Other income includes interest, royalty and lease income, as well as investment gains and losses. (b) Other expense includes a portion of pension and other retiree benefit costs. It also includes currency gains and losses, tax interest and miscellaneous items. Property, plant and equipment at cost Depreciable Lives (Years) December 31, 2019 2018 Land n/a $ 126 $ 128 Buildings and improvements 5 – 40 2,504 2,497 Machinery and equipment 2 – 10 3,110 2,800 Total $ 5,740 $ 5,425 Other long-term liabilities December 31, 2019 2018 Long-term portion of transition tax on indefinitely reinvested earnings $ 506 $ 506 Uncertain tax positions 303 286 Deferred compensation plans 298 246 Operating lease liabilities 259 — Other 148 152 Total $ 1,514 $ 1,190 Accumulated other comprehensive income (loss), net of taxes (AOCI) December 31, 2019 2018 Postretirement benefit plans: Net actuarial loss $ (347) $ (473) Prior service credit 2 2 Cash flow hedge derivative instruments (2) (2) Total $ (347) $ (473) Details on amounts reclassified out of accumulated other comprehensive income (loss), net of taxes, to net income Our Consolidated Statements of Comprehensive Income include items that have been recognized within net income in 2019, 2018 and 2017. The table below details where these transactions are recorded in our Consolidated Statements of Income. For Years Ended December 31, Impact to Related Statement of Income Lines 2019 2018 2017 Net actuarial losses of defined benefit plans: Recognized net actuarial loss and settlement losses (a) $ 51 $ 65 $ 83 Decrease to OI&E Tax effect (13) (15) (27) Decrease to provision for income taxes Recognized within net income, net of taxes $ 38 $ 50 $ 56 Decrease to net income Prior service credit of defined benefit plans: Amortization of prior service credit (a) $ — $ (4) $ (6) Increase to OI&E Tax effect — 1 1 Increase to provision for income taxes Recognized within net income, net of taxes $ — $ (3) $ (5) Increase to net income Derivative instruments: Amortization of treasury-rate locks $ — $ — $ 1 Increase to interest and debt expense Tax effect — — — Decrease to provision for income taxes Recognized within net income, net of taxes $ — $ — $ 1 Decrease to net income (a) Detailed in Note 8. |
Quarterly financial data (unaud
Quarterly financial data (unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial data (unaudited) | Quarterly financial data (unaudited) 2019 Quarters 2018 Quarters 4th 3rd 2nd 1st 4th 3rd 2nd 1st Revenue $ 3,350 $ 3,771 $ 3,668 $ 3,594 $ 3,717 $ 4,261 $ 4,017 $ 3,789 Gross profit 2,097 2,446 2,360 2,261 2,407 2,804 2,619 2,447 Included in operating profit: Acquisition charges 50 79 80 79 79 80 79 80 Restructuring charges/other — — (36) — (2) 1 3 1 Operating profit 1,249 1,589 1,506 1,379 1,516 1,937 1,712 1,548 Net income 1,070 1,425 1,305 1,217 1,239 1,570 1,405 1,366 Basic EPS $ 1.14 $ 1.51 $ 1.38 $ 1.29 $ 1.29 $ 1.61 $ 1.43 $ 1.38 Diluted EPS $ 1.12 $ 1.49 $ 1.36 $ 1.26 $ 1.27 $ 1.58 $ 1.40 $ 1.35 |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies and Practices (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The basis of these financial statements is comparable for all periods presented herein, except for the effects of adopting a new accounting standard in 2019 related to leases. The consolidated financial statements include the accounts of all subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. All dollar amounts in the financial statements and tables in these notes, except per-share amounts, are stated in millions of U.S. dollars unless otherwise indicated. We have reclassified certain amounts in the prior periods’ financial statements to conform to the 2019 presentation. The preparation of financial statements requires the use of estimates from which final results may vary. |
Revenue recognition | Revenue recognition We generate revenue primarily from the sale of semiconductor products, either directly to a customer or to a distributor, or at the conclusion of a consignment process. We have a variety of types of contracts with our customers and distributors. In determining whether a contract exists, we evaluate the terms of the arrangement, the relationship with the customer or distributor and their ability to pay. We recognize revenue from sales of our products, including sales to our distributors, when control is transferred. Control is considered transferred when title and risk of loss pass, when the customer becomes obligated to pay and, where required, when the customer has accepted the products. This transfer generally occurs at a point in time upon shipment or delivery to the customer or distributor, depending upon the terms of the sales order. Payment for sales to customers and distributors is generally due on our standard commercial terms. For sales to distributors, payment is not contingent upon resale of the products. Revenue from sales of our products that are subject to inventory consignment agreements is recognized at a point in time, when the customer or distributor pulls product from consignment inventory that we store at designated locations. Delivery and transfer of control occur at that point, when title and risk of loss transfers and the customer or distributor becomes obligated to pay for the products pulled from inventory. Until the products are pulled for use or sale by the customer or distributor, we retain control over the products’ disposition, including the right to pull back or relocate the products. The revenue recognized is adjusted based on allowances, which are prepared on a portfolio basis using a most likely amount methodology based on analysis of historical data and contractual terms. These allowances, which are not material, generally include adjustments for pricing arrangements, product returns and incentives. The length of time between invoicing and payment is not significant under any of our payment terms. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. In addition, we record allowances for accounts receivable that we estimate may not be collected. We monitor collectability of accounts receivable primarily through review of accounts receivable aging. When collection is at risk, we assess the impact on amounts recorded for bad debts and, if necessary, record a charge in the period such determination is made. We recognize shipping fees, if any, received from customers in revenue. We include the related shipping and handling costs in cost of revenue. The majority of our customers pay these fees directly to third parties. |
Advertising costs | Advertising costs We expense advertising and other promotional costs as incurred. This expense was $30 million, $34 million and $39 million in 2019, 2018 and 2017, respectively. |
Income taxes | Income taxes We account for income taxes using an asset and liability approach. We record the amount of taxes payable or refundable for the current year and the deferred tax assets and liabilities for future tax consequences of events that have been recognized in the financial statements or tax returns. We record a valuation allowance when it is more likely than not that some or all of the deferred tax assets will not be realized. |
Other assessed taxes | Other assessed taxes Some transactions require us to collect taxes such as sales, value-added and excise taxes from our customers. These transactions are presented in our Consolidated Statements of Income on a net (excluded from revenue) basis. |
Leases | Leases We determine if an arrangement is a lease at inception. Leases are included in other long-term assets, accrued expenses and other liabilities, and other long-term liabilities on our Consolidated Balance Sheets. Lease assets represent our right to use underlying assets for the lease term, and lease liabilities represent our obligations to make lease payments over the lease term. On the commencement date, leases are evaluated for classification, and assets and liabilities are recognized based on the present value of lease payments over the lease term. We use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments. Operating lease expense is generally recognized on a straight-line basis over the lease term. Our lease values include options to extend or not to terminate the lease when it is reasonably certain that we will exercise such options. |
Earnings per share (EPS) | Earnings per share (EPS) We use the two-class method for calculating EPS because the restricted stock units (RSUs) we grant are participating securities containing non-forfeitable rights to receive dividend equivalents. Under the two-class method, a portion of net income is allocated to RSUs and excluded from the calculation of income allocated to common stock, as shown in the table below. |
Investments | Investments We present investments on our Consolidated Balance Sheets as cash equivalents, short-term investments or long-term investments, which are detailed below. See Note 6 for additional information. • Cash equivalents and short-term investments – We consider investments in available-for-sale debt securities with maturities of 90 days or less from the date of our investment to be cash equivalents. We consider investments in available-for-sale debt securities with maturities beyond 90 days from the date of our investment as being available for use in current operations and include them in short-term investments. The primary objectives of our cash equivalent and short-term investment activities are to preserve capital and maintain liquidity while generating appropriate returns. • Long-term investments – Long-term investments consist of mutual funds, venture capital funds and non-marketable equity securities. Debt and equity investments measured at fair value Available-for-sale debt investments and trading securities are stated at fair value, which is generally based on market prices or broker quotes. See Fair-value considerations below. Unrealized gains and losses from available-for-sale debt securities are recorded as an increase or decrease, net of taxes, in AOCI on our Consolidated Balance Sheets. Other-than-temporary impairments on available-for-sale debt securities are recorded in OI&E in our Consolidated Statements of Income. We classify certain mutual funds as trading securities. These mutual funds hold a variety of debt and equity investments intended to generate returns that offset changes in certain deferred compensation liabilities. We record changes in the fair value of these mutual funds and the related deferred compensation liabilities in SG&A. Other equity investments Our other investments include equity-method investments and non-marketable equity investments, which are not measured at fair value. These investments consist of interests in venture capital funds and other non-marketable equity securities. Gains and losses from equity-method investments are recognized in OI&E based on our ownership share of the investee’s financial results. Non-marketable equity securities are measured at cost with adjustments for observable changes in price or impairments. Gains and losses on non-marketable equity investments are recognized in OI&E. |
Inventories | Inventories Inventories are stated at the lower of cost or estimated net realizable value. Cost is generally computed on a currently adjusted standard cost basis, which approximates cost on a first-in first-out basis. Standard cost is based on the normal utilization of installed factory capacity. Cost associated with underutilization of capacity is expensed as incurred. Inventory held at consignment locations is included in our finished goods inventory. We review inventory quarterly for salability and obsolescence. A statistical allowance is provided for inventory considered unlikely to be sold. The statistical allowance is based on an analysis of historical disposal activity, historical customer shipments, as well as estimated future sales. A specific allowance for each material type will be carried if there is a significant event not captured by the statistical allowance. We write off inventory in the period in which disposal occurs. |
Property, plant and equipment; acquisition-related intangibles and other capitalized costs | Property, plant and equipment; acquisition-related intangibles; and other capitalized costs Property, plant and equipment are stated at cost and depreciated over their estimated useful lives using the straight-line method. Our cost basis includes certain assets acquired in business combinations that were initially recorded at fair value as of the date of acquisition. Leasehold improvements are amortized using the straight-line method over the shorter of the remaining lease term or the estimated useful lives of the improvements. We amortize acquisition-related intangibles on a straight-line basis over the estimated economic life of the assets. Capitalized software licenses generally are amortized on a straight-line basis over the term of the license. Fully depreciated or amortized assets are written off against accumulated depreciation or amortization. |
Impairments of long-lived assets | Impairments of long-lived assets We regularly review whether facts or circumstances exist that indicate the carrying values of property, plant and equipment or other long-lived assets, including intangible assets, are impaired. We assess the recoverability of assets by comparing the projected undiscounted net cash flows associated with those assets to their respective carrying amounts. Any impairment charge is based on the excess of the carrying amount over the fair value of those assets. Fair value is determined by available market valuations, if applicable, or by discounted cash flows. |
Goodwill | Goodwill Goodwill is reviewed for impairment annually or more frequently if certain impairment indicators arise. We perform our annual goodwill impairment test as of October 1 for our reporting units, which compares the fair value for each reporting unit to its associated carrying value, including goodwill. See Note 7 for additional information. |
Foreign currency | Foreign currency The functional currency for our non-U.S. subsidiaries is the U.S. dollar. Accounts recorded in currencies other than the U.S. dollar are remeasured into the functional currency. Current assets (except inventories), deferred taxes, other assets, current liabilities and long-term liabilities are remeasured at exchange rates in effect at the end of each reporting period. Property, plant and equipment with associated depreciation and inventories are valued at historical exchange rates. Revenue and expense accounts other than depreciation for each month are remeasured at the appropriate daily rate of exchange. Currency exchange gains and losses from remeasurement are credited or charged to OI&E. |
Derivatives and hedging | Derivatives and hedging We use derivative financial instruments to manage exposure to foreign exchange risk. These instruments are primarily forward foreign currency exchange contracts, which are used as economic hedges to reduce the earnings impact that exchange rate fluctuations may have on our non-U.S. dollar net balance sheet exposures. Gains and losses from changes in the fair value of these forward foreign currency exchange contracts are credited or charged to OI&E. We do not apply hedge accounting to our foreign currency derivative instruments. In connection with the issuance of long-term debt, we may use financial derivatives such as treasury-rate lock agreements that are recognized in AOCI and amortized over the life of the related debt. The results of these derivative transactions have not been material. We do not use derivatives for speculative or trading purposes. |
Changes in accounting standards | Changes in accounting standards – adopted standards for current period Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) We adopted ASU No. 2016-02, Leases (ASC 842) effective January 1, 2019, using the modified retrospective transition method applied to leases existing at, or entered into after, the adoption date. The reported results for 2019 reflect the application of the new accounting guidance, while the reported results for prior periods are not adjusted and continue to be reported in accordance with our historical accounting under ASC 840, Leases. In addition, we elected the package of practical expedients permitted under the transition guidance that allowed us to apply prior conclusions related to lease definition, classification and initial direct costs. The adoption of the new standard resulted in the recognition of $229 million of lease liabilities with corresponding lease assets as of January 1, 2019. The standard did not materially impact our results of operations and had no impact on cash flows. Other standards The following standards were also adopted: ASU Description Adopted Date ASU No. 2017-12 Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities January 1, 2019 ASU No. 2018-14 Compensation – Retirement Benefits – Defined Benefit Plans – General (Subtopic 715-20): Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans January 1, 2019 Changes in accounting standards – standards not yet adopted ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This standard requires entities to use a current lifetime expected credit loss methodology to measure impairments of certain financial assets. Using this methodology will result in earlier recognition of losses than under the current incurred loss approach, which requires waiting to recognize a loss until it is probable of being incurred. Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses rather than as a reduction to the amortized cost basis of the securities. We are adopting this standard effective January 1, 2020, applying the guidance on a modified retrospective basis. In preparation for adoption of the standard, we have updated certain policies and related processes, but this standard will not have a material impact on our financial position or results of operations. Other standards We are evaluating the impact of the following standards, but we do not expect them to have a material impact on our financial position or results of operations. We are adopting these standards as of their effective dates. ASU Description Effective Date ASU No. 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement January 1, 2020 ASU No. 2018-15 Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract January 1, 2020 |
Stock compensation | We recognize compensation expense for non-qualified stock options and RSUs on a straight-line basis over the minimum service period required for vesting of the award, adjusting for estimated forfeitures based on historical activity. Awards issued to employees who are retirement eligible or nearing retirement eligibility are expensed on an accelerated basis. Options issued under our ESPP are expensed over a three-month period. We determine expected volatility on all options granted using available implied volatility rates. We believe that market-based measures of implied volatility are currently the best available indicators of the expected volatility used in these estimates. We determine expected lives of options based on the historical option exercise experience of our optionees using a rolling 10-year average. We believe the historical experience method is the best estimate of future exercise patterns currently available. Risk-free interest rates are determined using the implied yield currently available for zero-coupon U.S. government issues with a remaining term equal to the expected life of the options. Expected dividend yields are based on the annualized approved quarterly dividend rate and the current market price of our common stock at the time of grant. No assumption for a future dividend rate change is included unless there is an approved plan to change the dividend in the near term. The fair value per share of RSUs is determined based on the closing price of our common stock on the date of grant. Our ESPP is a discount-purchase plan and consequently the Black-Scholes-Merton option-pricing model is not used to determine the fair value per share of these awards. The fair value per share under this plan equals the amount of the discount. |
Fair values considerations | Fair-value considerations We measure and report certain financial assets and liabilities at fair value on a recurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The three-level hierarchy described below indicates the extent and level of judgment used to estimate fair-value measurements. • Level 1 – Uses unadjusted quoted prices that are available in active markets for identical assets or liabilities as of the reporting date. • Level 2 – Uses inputs other than Level 1 that are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data. We utilize a third-party data service to provide Level 2 valuations. We verify these valuations for reasonableness relative to unadjusted quotes obtained from brokers or dealers based on observable prices for similar assets in active markets. • Level 3 – Uses inputs that are unobservable, supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models that utilize management estimates of market participant assumptions. As of December 31, 2019 and 2018, we had no Level 3 assets or liabilities. |
Indemnification guarantees and warranty costs/product liabilities | Indemnification guarantees We routinely sell products with an intellectual property indemnification included in the terms of sale. Historically, we have had only minimal, infrequent losses associated with these indemnities. Consequently, we cannot reasonably estimate any future liabilities that may result. Warranty costs/product liabilities We accrue for known product-related claims if a loss is probable and can be reasonably estimated. During the periods presented, there have been no material accruals or payments regarding product warranty or product liability. Historically, we have experienced a low rate of payments on product claims. Although we cannot predict the likelihood or amount of any future claims, we do not believe they will have a material adverse effect on our financial condition, results of operations or liquidity. Our stated warranties for semiconductor products obligate us to repair, replace or credit the purchase price of a covered product back to the buyer. Product claim consideration may exceed the price of our products. |
Description of Business, Incl_2
Description of Business, Including Segment and Geographic Area Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Operating Profit, by Segment | Segment information For Years Ended December 31, 2019 2018 2017 Revenue: Analog $ 10,223 $ 10,801 $ 9,900 Embedded Processing 2,943 3,554 3,498 Other 1,217 1,429 1,563 Total revenue $ 14,383 $ 15,784 $ 14,961 Operating profit: Analog $ 4,477 $ 5,109 $ 4,468 Embedded Processing 907 1,205 1,143 Other 339 399 472 Total operating profit $ 5,723 $ 6,713 $ 6,083 |
Schedule of Revenue, by Geographic Area | Geographic area information The following geographic area information includes revenue, based on product shipment destination, and property, plant and equipment, based on physical location. The geographic revenue information does not necessarily reflect end demand by geography because our products tend to be shipped to the locations where our customers manufacture their products. For Years Ended December 31, 2019 2018 2017 Revenue: United States $ 1,827 $ 2,288 $ 1,901 Asia (a) 8,650 9,240 8,824 Europe, Middle East and Africa 2,707 3,047 2,907 Japan 796 869 1,049 Rest of world 403 340 280 Total revenue $ 14,383 $ 15,784 $ 14,961 (a) Revenue from products shipped into China was $7.2 billion, $7.0 billion and $6.6 billion in 2019, 2018 and 2017, respectively, which includes shipments to customers that manufacture in China and then export end products to their customers around the world, as well as distributors that transship inventory through China to service other countries. |
Schedule Property, Plant and Equipment by Geographic Area | December 31, 2019 2018 Property, plant and equipment: United States $ 1,998 $ 1,812 Asia (a) 1,046 1,116 Europe, Middle East and Africa 63 84 Japan 185 157 Rest of world 11 14 Total property, plant and equipment $ 3,303 $ 3,183 (a) Property, plant and equipment at our two sites in the Philippines was $394 million and $437 million as of December 31, 2019 and 2018, respectively. Property, plant and equipment at our sites in China was $304 million and $313 million as of December 31, 2019 and 2018, respectively. |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies and Practices (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Earnings per Share, Basic and Diluted | Computation and reconciliation of earnings per common share are as follows (shares in millions): For Years Ended December 31, 2019 2018 2017 Net Income Shares EPS Net Income Shares EPS Net Income Shares EPS Basic EPS: Net income $ 5,017 $ 5,580 $ 3,682 Income allocated to RSUs (32) (43) (34) Income allocated to common stock $ 4,985 936 $ 5.33 $ 5,537 970 $ 5.71 $ 3,648 991 $ 3.68 Dilutive effect of stock compensation plans 16 20 21 Diluted EPS: Net income $ 5,017 $ 5,580 $ 3,682 Income allocated to RSUs (31) (42) (33) Income allocated to common stock $ 4,986 952 $ 5.24 $ 5,538 990 $ 5.59 $ 3,649 1,012 $ 3.61 |
Stock Compensation (Tables)
Stock Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Compensation Expense Allocation Within the Consolidated Statements of Income | Total stock compensation expense recognized is as follows: For Years Ended December 31, 2019 2018 2017 COR $ 21 $ 25 $ 36 R&D 66 69 59 SG&A 130 138 147 Total $ 217 $ 232 $ 242 |
Schedule of Weighted Average Assumptions Used to Estimate the Fair Values for Non-qualified Stock Options | We estimate the fair values for non-qualified stock options using the Black-Scholes-Merton option-pricing model with the following weighted average assumptions: For Years Ended December 31, 2019 2018 2017 Weighted average grant date fair value, per share $ 22.08 $ 23.20 $ 16.49 Weighted average assumptions used: Expected volatility 26 % 23 % 24 % Expected lives (in years) 7.1 7.2 7.2 Risk-free interest rates 2.66 % 2.57 % 2.36 % Expected dividend yields 2.95 % 2.25 % 2.52 % |
Schedule of Stock Option and RSU Transactions Under Long-term Incentive and Director Compensation Plans | Stock option and RSU transactions under our long-term incentive and director compensation plans are as follows: Stock Options RSUs Shares Weighted Average Exercise Price per Share Shares Weighted Average Grant Date Fair Value per Share Outstanding grants, December 31, 2018 39,905,454 $ 56.10 7,305,543 $ 66.72 Granted 4,559,093 104.51 1,142,974 106.58 Stock options exercised/RSUs vested (11,529,174) 44.68 (2,370,762) 52.74 Forfeited and expired (441,429) 83.89 (179,955) 81.57 Outstanding grants, December 31, 2019 32,493,944 66.57 5,897,800 79.62 |
Schedule of Shares Outstanding Under Stock Option Plans, by Exercise Price Range | Summarized information about stock options outstanding as of December 31, 2019, is as follows: Stock Options Outstanding Options Exercisable Exercise Price Range Number Outstanding (Shares) Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price per Share Number Exercisable (Shares) Weighted Average Exercise Price per Share $ 23.05 to 127.35 32,493,944 5.9 $ 66.57 19,646,782 $ 50.82 |
Schedule of Stock Options That are Vested and Expected to Vest, Outstanding and Exercisable | Summarized information as of December 31, 2019, about outstanding stock options that are vested and expected to vest, as well as stock options that are currently exercisable, is as follows: Outstanding Stock Options (Fully Vested and Expected to Vest) (a) Options Exercisable Number of outstanding (shares) 32,001,396 19,646,782 Weighted average remaining contractual life (in years) 5.8 4.6 Weighted average exercise price per share $ 66.03 $ 50.82 Intrinsic value (millions of dollars) $ 1,992 $ 1,522 (a) Includes effects of expected forfeitures. Excluding the effects of expected forfeitures, the aggregate intrinsic value of stock options outstanding was $2.01 billion. |
Schedule of ESPP Transactions | ESPP transactions are as follows: Shares Exercise Price Outstanding grants, December 31, 2018 229,836 $ 80.29 Granted 742,819 102.34 Exercised (798,806) 94.30 Outstanding grants, December 31, 2019 173,849 110.14 |
Schedule of Changes in Treasury Stock | The following table reflects the changes in our treasury shares: Stock Options RSUs Treasury Shares Balance, December 31, 2016 744,831,978 Repurchases 30,570,129 Shares used for: Stock options/RSUs (13,313,019) (4,419,464) Stock applied to taxes — 1,058,100 ESPP (1,065,757) — Director deferred stock units — — (4,750) Total issued (14,378,776) (3,361,364) (17,740,140) Balance, December 31, 2017 757,657,217 Repurchases 49,482,220 Shares used for: Stock options/RSUs (8,432,458) (2,769,994) Stock applied to taxes — 553,720 ESPP (819,878) — Director deferred stock units — — (5,181) Total issued (9,252,336) (2,216,274) (11,468,610) Balance, December 31, 2018 795,665,646 Repurchases 27,398,701 Shares used for: Stock options/RSUs (11,529,174) (2,370,762) Stock applied to taxes — 490,347 ESPP (798,806) — Director deferred stock units — — (71,571) Total issued (12,327,980) (1,880,415) (14,208,395) Balance, December 31, 2019 808,784,381 |
Schedule of Cash Proceeds Received from Share-based Payment Awards | The effects on cash flows are as follows: For Years Ended December 31, 2019 2018 2017 Proceeds from common stock transactions (a) $ 539 $ 373 $ 483 Tax benefit realized from stock compensation $ 224 $ 179 $ 341 Reduction to deferred tax asset (49) (43) (91) Excess tax benefit for stock compensation $ 175 $ 136 $ 250 (a) Net of taxes paid for employee shares withheld of $52 million, $60 million and $83 million in 2019, 2018 and 2017, respectively. |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income before income taxes | Income before income taxes is comprised of the following components: For Years Ended December 31, 2019 2018 2017 U.S. $ 4,915 $ 5,672 $ 5,130 Non-U.S. 813 1,014 950 Total $ 5,728 $ 6,686 $ 6,080 |
Provision for income taxes | Provision for income taxes is comprised of the following components: For Years Ended December 31, 2019 2018 2017 Current Deferred Total Current Deferred Total Current Deferred Total U.S. federal $ 483 $ 25 $ 508 $ 979 $ (98) $ 881 $ 2,101 $ 51 $ 2,152 Non-U.S. 135 56 191 225 (8) 217 173 61 234 U.S. state 12 — 12 7 1 8 12 — 12 Total $ 630 $ 81 $ 711 $ 1,211 $ (105) $ 1,106 $ 2,286 $ 112 $ 2,398 |
Principal reconciliation items from U.S. statutory income tax rate to the effective tax rate | Principal reconciling items from the U.S. statutory income tax rate to the effective tax rate (provision for income taxes as a percentage of income before income taxes) are as follows: For Years Ended December 31, 2019 2018 2017 U.S. statutory income tax rate 21.0 % 21.0 % 35.0 % U.S. tax benefit for foreign derived intangible income (4.9) (5.3) — U.S. excess tax benefit for stock compensation (3.1) (2.0) (4.1) U.S. R&D tax credit (1.4) (1.3) (1.1) Non-U.S. effective tax rates 0.3 0.1 (2.5) U.S. Tax Act transitional non-cash expense — 4.2 — U.S. Tax Act enactment-date effects and measurement period adjustments — (0.7) 12.7 U.S. tax benefit for manufacturing — — (1.6) Other 0.5 0.5 1.0 Effective tax rate 12.4 % 16.5 % 39.4 % |
Primary components of deferred tax assets and liabilities | The primary components of deferred tax assets and liabilities are as follows: December 31, 2019 2018 Deferred tax assets: Deferred loss and tax credit carryforwards $ 213 $ 247 Accrued expenses 113 129 Stock compensation 109 122 Inventories and related reserves 109 107 Retirement costs for defined benefit and retiree health care 49 80 Total deferred tax assets, before valuation allowance 593 685 Valuation allowance (180) (172) Total deferred tax assets, after valuation allowance 413 513 Deferred tax liabilities: Property, plant and equipment (95) (10) Acquisition-related intangibles and fair-value adjustments (82) (142) International earnings (62) (43) Other (55) (65) Total deferred tax liabilities (294) (260) Net deferred tax asset $ 119 $ 253 |
Deferred tax assets and liabilities presentation on the Balance sheet | The deferred tax assets and liabilities based on tax jurisdictions are presented on our Consolidated Balance Sheets as follows: December 31, 2019 2018 Deferred tax assets $ 197 $ 295 Deferred tax liabilities (78) (42) Net deferred tax asset $ 119 $ 253 |
Summary of uncertain tax positions | The changes in the total amounts of uncertain tax positions are as follows: 2019 2018 2017 Balance, January 1 $ 286 $ 300 $ 243 Additions based on tax positions related to the current year 3 3 17 Additions for tax positions of prior years 63 1 42 Reductions for tax positions of prior years (41) — (1) Settlements with tax authorities (8) (18) (1) Balance, December 31 $ 303 $ 286 $ 300 Interest income (expense) recognized in the year ended December 31 $ 9 $ (15) $ (19) Interest payable as of December 31 $ 44 $ 49 $ 38 |
Valuation of Debt and Equity _2
Valuation of Debt and Equity Investments and Certain Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Investments | Details of our investments are as follows: December 31, 2019 December 31, 2018 Cash and Cash Equivalents Short-Term Investments Long-Term Investments Cash and Cash Equivalents Short-Term Investments Long-Term Investments Measured at fair value: Available-for-sale debt securities: Money market funds $ 1,213 $ — $ — $ 747 $ — $ — Corporate obligations 174 1,216 — 473 748 — U.S. government agency and Treasury securities 604 1,734 — 988 1,047 — Trading securities: Mutual funds — — 272 — — 226 Total 1,991 2,950 272 2,208 1,795 226 Other measurement basis: Equity-method investments — — 24 — — 21 Non-marketable equity investments — — 4 — — 4 Cash on hand 446 — — 230 — — Total $ 2,437 $ 2,950 $ 300 $ 2,438 $ 1,795 $ 251 |
Aggregate Maturities of Available-for-sale Debt Investments | The following table presents the aggregate maturities of our available-for-sale debt investments as of December 31, 2019: Fair Value One year or less $ 4,921 One to two years 20 |
Assets and Liabilities Accounted for at Fair Value | The following are our assets and liabilities that were accounted for at fair value on a recurring basis. These tables do not include cash on hand, assets held by our postretirement plans, or assets and liabilities that are measured at historical cost or any basis other than fair value. December 31, 2019 December 31, 2018 Level 1 Level 2 Total Level 1 Level 2 Total Assets: Money market funds $ 1,213 $ — $ 1,213 $ 747 $ — $ 747 Corporate obligations — 1,390 1,390 — 1,221 1,221 U.S. government agency and Treasury securities 2,338 — 2,338 2,035 — 2,035 Mutual funds 272 — 272 226 — 226 Total assets $ 3,823 $ 1,390 $ 5,213 $ 3,008 $ 1,221 $ 4,229 Liabilities: Deferred compensation $ 298 $ — $ 298 $ 246 $ — $ 246 Total liabilities $ 298 $ — $ 298 $ 246 $ — $ 246 |
Goodwill and Acquisition-Rela_2
Goodwill and Acquisition-Related Intangibles (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill by segment as of December 31, 2019 and 2018, is as follows: Goodwill Analog $ 4,158 Embedded Processing 172 Other 32 Total $ 4,362 |
Schedule of Acquisition-Related Intangible Assets | The components of acquisition-related intangibles are as follows: December 31, 2019 December 31, 2018 Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Developed technology 7 – 10 $ 2,000 $ 1,660 $ 340 $ 2,125 $ 1,573 $ 552 Customer relationships 8 — — — 810 734 76 Total $ 2,000 $ 1,660 $ 340 $ 2,935 $ 2,307 $ 628 |
Postretirement Benefit Plans (T
Postretirement Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Expense Related to Defined Benefit and Retiree Health Care Benefit Plans | Expense related to defined benefit and retiree health care benefit plans is as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2017 2019 2018 2017 2019 2018 2017 Service cost $ 18 $ 19 $ 22 $ 3 $ 5 $ 5 $ 31 $ 36 $ 37 Interest cost 38 35 42 14 15 17 43 45 44 Expected return on plan assets (41) (42) (41) (14) (15) (17) (86) (67) (62) Amortization of prior service cost (credit) — — — (1) (3) (4) 1 (1) (2) Recognized net actuarial loss 9 17 14 — 2 3 29 20 28 Net periodic benefit costs 24 29 37 2 4 4 18 33 45 Settlement losses 10 23 36 — — — 3 3 2 Total, including other postretirement losses $ 34 $ 52 $ 73 $ 2 $ 4 $ 4 $ 21 $ 36 $ 47 |
Schedule of Changes in the Benefit Obligations and Plan Assets for the Defined Benefit and Retiree Health Care Benefit Plans | Changes in the benefit obligations and plan assets for defined benefit and retiree health care benefit plans are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2019 2018 2019 2018 Change in plan benefit obligation Benefit obligation at beginning of year: $ 874 $ 998 $ 361 $ 414 $ 2,411 $ 2,469 Service cost 18 19 3 5 31 36 Interest cost 38 35 14 15 43 45 Participant contributions — — 13 11 7 7 Benefits paid (11) (10) (41) (41) (103) (87) Settlements (66) (100) — — (12) (16) Curtailments — — — — (1) — Actuarial loss (gain) 107 (68) 9 (43) 193 6 Plan amendments — — — — — 7 Effects of exchange rate changes — — — — 12 (56) Benefit obligation at end of year $ 960 $ 874 $ 359 $ 361 $ 2,581 $ 2,411 Change in plan assets Fair value of plan assets at beginning of year: $ 869 $ 995 $ 330 $ 394 $ 2,410 $ 2,593 Actual return on plan assets 185 (56) 53 (12) 337 (52) Employer contributions (qualified plans) — 20 1 1 9 19 Employer contributions (non-qualified plans) 10 20 — — — — Participant contributions — — 13 11 7 7 Benefits paid (11) (10) (41) (41) (103) (87) Settlements (66) (100) — — (12) (16) Effects of exchange rate changes — — — — 13 (54) Other — — — (23) — — Fair value of plan assets at end of year $ 987 $ 869 $ 356 $ 330 $ 2,661 $ 2,410 Funded status at end of year $ 27 $ (5) $ (3) $ (31) $ 80 $ (1) |
Schedule of Amounts Recognized in our Balance Sheet | Amounts recognized on our Consolidated Balance Sheets as of December 31, are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit Total 2019 Overfunded retirement plans $ 73 $ — $ 145 $ 218 Accrued expenses and other liabilities & other long-term liabilities (17) — (4) (21) Underfunded retirement plans (29) (3) (61) (93) Funded status at end of 2019 $ 27 $ (3) $ 80 $ 104 2018 Overfunded retirement plans $ 40 $ — $ 52 $ 92 Accrued expenses and other liabilities & other long-term liabilities (8) — (3) (11) Underfunded retirement plans (37) (31) (50) (118) Funded status at end of 2018 $ (5) $ (31) $ (1) $ (37) |
Schedule of Change in AOCI | The change in AOCI is as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit Total Net Actuarial Loss Net Actuarial Loss Prior Service Credit Net Actuarial Loss Prior Service Credit Net Actuarial Loss Prior Service Credit AOCI balance, net of taxes, December 31, 2018 $ 135 $ 21 $ (5) $ 317 $ 3 $ 473 $ (2) Changes in AOCI by category: Adjustments (36) (31) — (58) — (125) — Recognized within net income (19) — 1 (32) (1) (51) — Tax effect 11 7 — 32 — 50 — Total change to AOCI (44) (24) 1 (58) (1) (126) — AOCI balance, net of taxes, December 31, 2019 $ 91 $ (3) $ (4) $ 259 $ 2 $ 347 $ (2) |
Schedule of Allocation of Plan Assets | The tables below set forth the fair value of our plan assets using the same three-level hierarchy of fair-value inputs described in Note 6. December 31, 2019 Level 1 Level 2 Other (a) Total Assets of U.S. defined benefit plan: Fixed income securities and cash equivalents $ — $ — $ 640 $ 640 Equity securities — — 347 347 Total $ — $ — $ 987 $ 987 Assets of U.S. retiree health care plan: Fixed income securities and cash equivalents $ 62 $ — $ 168 $ 230 Equity securities — — 126 126 Total $ 62 $ — $ 294 $ 356 Assets of non-U.S. defined benefit plans: Fixed income securities and cash equivalents $ 59 $ 126 $ 1,762 $ 1,947 Equity securities 41 2 671 714 Total $ 100 $ 128 $ 2,433 $ 2,661 (a) Consists of bond index and equity index funds, measured at net asset value per share, as well as cash equivalents. December 31, 2018 Level 1 Level 2 Other (a) Total Assets of U.S. defined benefit plan: Fixed income securities and cash equivalents $ — $ — $ 563 $ 563 Equity securities — — 306 306 Total $ — $ — $ 869 $ 869 Assets of U.S. retiree health care plan: Fixed income securities and cash equivalents $ 59 $ — $ 155 $ 214 Equity securities — — 116 116 Total $ 59 $ — $ 271 $ 330 Assets of non-U.S. defined benefit plans: Fixed income securities and cash equivalents $ 47 $ 139 $ 1,602 $ 1,788 Equity securities 33 1 588 622 Total $ 80 $ 140 $ 2,190 $ 2,410 (a) Consists of bond index and equity index funds, measured at net asset value per share, as well as cash equivalents. The target allocation ranges for the plans that hold a substantial majority of the defined benefit assets are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit Fixed income securities and cash equivalents 65% 65% 60% – 100% Equity securities 35% 35% 0% – 40% Weighted average asset allocations as of December 31 are as follows: U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2019 2018 2019 2018 Fixed income securities and cash equivalents 65% 65% 65% 65% 73% 74% Equity securities 35% 35% 35% 35% 27% 26% |
Schedule of Assumptions Used | Assumptions and investment policies U.S. Defined Benefit U.S. Retiree Health Care Non-U.S. Defined Benefit 2019 2018 2019 2018 2019 2018 Weighted average assumptions used to determine benefit obligations: Discount rate 3.62% 4.37% 3.63% 4.30% 1.46% 1.85% Long-term pay progression 3.30% 3.30% n/a n/a 3.06% 2.96% Weighted average assumptions used to determine net periodic benefit cost: Discount rate 4.35% 3.77% 4.30% 3.63% 1.85% 1.84% Long-term rate of return on plan assets 4.90% 4.80% 4.40% 4.10% 3.62% 2.58% Long-term pay progression 3.30% 3.30% n/a n/a 3.03% 2.96% |
Schedule of Assumed Future Benefit Payments | The following assumed future benefit payments to plan participants in the next 10 years are used to measure our benefit obligations. Almost all of the payments, which may vary significantly from these assumptions, will be made from plan assets and not from company assets. 2020 2021 2022 2023 2024 2025 – 2029 U.S. Defined Benefit $ 99 $ 118 $ 85 $ 90 $ 87 $ 441 U.S. Retiree Health Care 32 30 29 27 26 115 Non-U.S. Defined Benefit 95 96 99 100 104 542 |
Schedule of Assumed Health Care Cost Trend Rates for U.S Retiree Health Care Benefit Plan | Assumed health care cost trend rates for the U.S. retiree health care benefit plan as of December 31 are as follows: 2019 2018 Assumed health care cost trend rate for next year 7.00% 7.25% Ultimate trend rate 5.00% 5.00% Year in which ultimate trend rate is reached 2028 2028 |
Debt and Lines of Credit (Table
Debt and Lines of Credit (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt outstanding is as follows: December 31, 2019 2018 Notes due 2019 at 1.65% $ — $ 750 Notes due 2020 at 1.75% 500 500 Notes due 2021 at 2.75% 550 550 Notes due 2022 at 1.85% 500 500 Notes due 2023 at 2.25% 500 500 Notes due 2024 at 2.625% 300 300 Notes due 2027 at 2.90% 500 500 Notes due 2029 at 2.25% 750 — Notes due 2039 at 3.875% 750 — Notes due 2048 at 4.15% 1,500 1,500 Total debt 5,850 5,100 Net unamortized discounts, premiums and issuance costs (47) (32) Total debt, including net unamortized discounts, premiums and issuance costs 5,803 5,068 Current portion of long-term debt (500) (749) Long-term debt $ 5,303 $ 4,319 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Balance sheet components of leases | Our leases are included as a component of the following balance sheet lines: December 31, 2019 Other long-term assets $ 337 Accrued expenses and other liabilities $ 73 Other long-term liabilities 259 |
Schedule of Operating Leases | Details of our operating leases are as follows: For Year Ended 2019 Lease cost related to lease liabilities $ 66 Variable lease cost 41 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for lease cost $ 60 Lease assets obtained in exchange for new lease liabilities $ 167 Weighted average remaining lease term 8.2 years Weighted average discount rate 3.37 % |
Maturities of operating leases | As of December 31, 2019, we had committed to make the following minimum payments under our non-cancellable operating leases: 2020 2021 2022 2023 2024 Thereafter Total Lease payments $ 75 $ 63 $ 51 $ 38 $ 28 $ 131 $ 386 Imputed lease interest (54) Total lease liabilities $ 332 |
Maturities of operating leases under topic 840 | As of December 31, 2018, we had committed to make the following minimum payments under our non-cancellable operating leases, as reported under ASC 840: 2019 2020 2021 2022 2023 Thereafter Total Operating leases $ 56 $ 46 $ 36 $ 29 $ 18 $ 39 $ 224 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Minimum Payments Under Purchase Commitments | As of December 31, 2019, we had committed to make the following minimum payments under our purchase commitments: 2020 2021 2022 2023 2024 Thereafter Total Purchase commitments $ 452 $ 286 $ 121 $ 70 $ 27 $ 109 $ 1,065 |
Supplemental financial inform_2
Supplemental financial information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Text Block Supplement [Abstract] | |
Restructuring charges and other | Restructuring charges/other are included in Other for segment reporting purposes and are comprised of the following components: For Years Ended December 31, 2019 2018 2017 Restructuring charges (a) $ (15) $ 6 $ 11 Gains on sales of assets (21) (3) — Restructuring charges/other $ (36) $ 3 $ 11 (a) Includes severance and benefits, accelerated depreciation, changes in estimates or other exit costs. |
Changes in accrued restructuring balances | Changes in accrued restructuring balances 2019 2018 2017 Balance, January 1 $ 28 $ 29 $ 40 Restructuring charges (15) 6 11 Non-cash items (a) — (3) (1) Payments (13) (4) (21) Balance, December 31 $ — $ 28 $ 29 (a) Reflects charges for impacts of accelerated depreciation and changes in exchange rates. |
Other income (expense), net (OI&E) | Other income (expense), net (OI&E) For Years Ended December 31, 2019 2018 2017 Other income (a) $ 197 $ 150 $ 163 Other expense (b) (22) (52) (88) Total $ 175 $ 98 $ 75 (a) Other income includes interest, royalty and lease income, as well as investment gains and losses. (b) Other expense includes a portion of pension and other retiree benefit costs. It also includes currency gains and losses, tax interest and miscellaneous items. |
Property, plant and equipment at cost | Property, plant and equipment at cost Depreciable Lives (Years) December 31, 2019 2018 Land n/a $ 126 $ 128 Buildings and improvements 5 – 40 2,504 2,497 Machinery and equipment 2 – 10 3,110 2,800 Total $ 5,740 $ 5,425 |
Other long-term liabilities | Other long-term liabilities December 31, 2019 2018 Long-term portion of transition tax on indefinitely reinvested earnings $ 506 $ 506 Uncertain tax positions 303 286 Deferred compensation plans 298 246 Operating lease liabilities 259 — Other 148 152 Total $ 1,514 $ 1,190 |
Accumulated other comprehensive income (loss), net of taxes (AOCI) | Accumulated other comprehensive income (loss), net of taxes (AOCI) December 31, 2019 2018 Postretirement benefit plans: Net actuarial loss $ (347) $ (473) Prior service credit 2 2 Cash flow hedge derivative instruments (2) (2) Total $ (347) $ (473) |
Amounts reclassified out of accumulated other comprehensive income (loss), net of taxes, to net income | The table below details where these transactions are recorded in our Consolidated Statements of Income. For Years Ended December 31, Impact to Related Statement of Income Lines 2019 2018 2017 Net actuarial losses of defined benefit plans: Recognized net actuarial loss and settlement losses (a) $ 51 $ 65 $ 83 Decrease to OI&E Tax effect (13) (15) (27) Decrease to provision for income taxes Recognized within net income, net of taxes $ 38 $ 50 $ 56 Decrease to net income Prior service credit of defined benefit plans: Amortization of prior service credit (a) $ — $ (4) $ (6) Increase to OI&E Tax effect — 1 1 Increase to provision for income taxes Recognized within net income, net of taxes $ — $ (3) $ (5) Increase to net income Derivative instruments: Amortization of treasury-rate locks $ — $ — $ 1 Increase to interest and debt expense Tax effect — — — Decrease to provision for income taxes Recognized within net income, net of taxes $ — $ — $ 1 Decrease to net income (a) Detailed in Note 8. |
Quarterly financial data (una_2
Quarterly financial data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial data | 2019 Quarters 2018 Quarters 4th 3rd 2nd 1st 4th 3rd 2nd 1st Revenue $ 3,350 $ 3,771 $ 3,668 $ 3,594 $ 3,717 $ 4,261 $ 4,017 $ 3,789 Gross profit 2,097 2,446 2,360 2,261 2,407 2,804 2,619 2,447 Included in operating profit: Acquisition charges 50 79 80 79 79 80 79 80 Restructuring charges/other — — (36) — (2) 1 3 1 Operating profit 1,249 1,589 1,506 1,379 1,516 1,937 1,712 1,548 Net income 1,070 1,425 1,305 1,217 1,239 1,570 1,405 1,366 Basic EPS $ 1.14 $ 1.51 $ 1.38 $ 1.29 $ 1.29 $ 1.61 $ 1.43 $ 1.38 Diluted EPS $ 1.12 $ 1.49 $ 1.36 $ 1.26 $ 1.27 $ 1.58 $ 1.40 $ 1.35 |
Description of Business, Incl_3
Description of Business, Including Segment and Geographic Area Information - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2019reportableSegment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Description of Business, Incl_4
Description of Business, Including Segment and Geographic Area Information - Schedule of Revenue and Operating Profit by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | $ 3,350 | $ 3,771 | $ 3,668 | $ 3,594 | $ 3,717 | $ 4,261 | $ 4,017 | $ 3,789 | $ 14,383 | $ 15,784 | $ 14,961 |
Total operating profit | $ 1,249 | $ 1,589 | $ 1,506 | $ 1,379 | $ 1,516 | $ 1,937 | $ 1,712 | $ 1,548 | 5,723 | 6,713 | 6,083 |
Analog | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 10,223 | 10,801 | 9,900 | ||||||||
Total operating profit | 4,477 | 5,109 | 4,468 | ||||||||
Embedded Processing | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 2,943 | 3,554 | 3,498 | ||||||||
Total operating profit | 907 | 1,205 | 1,143 | ||||||||
Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue | 1,217 | 1,429 | 1,563 | ||||||||
Total operating profit | $ 339 | $ 399 | $ 472 |
Description of Business, Incl_5
Description of Business, Including Segment and Geographic Area Information - Schedule of Revenue by Geographic Area (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | $ 3,350 | $ 3,771 | $ 3,668 | $ 3,594 | $ 3,717 | $ 4,261 | $ 4,017 | $ 3,789 | $ 14,383 | $ 15,784 | $ 14,961 | |
United States | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 1,827 | 2,288 | 1,901 | |||||||||
Asia | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | [1] | 8,650 | 9,240 | 8,824 | ||||||||
Europe, Middle East And Africa | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 2,707 | 3,047 | 2,907 | |||||||||
Japan | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 796 | 869 | 1,049 | |||||||||
Rest of world | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 403 | 340 | 280 | |||||||||
China | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | $ 7,200 | $ 7,000 | $ 6,600 | |||||||||
[1] | Revenue from products shipped into China was $7.2 billion, $7.0 billion and $6.6 billion in 2019, 2018 and 2017, respectively, which includes shipments to customers that manufacture in China and then export end products to their customers around the world, as well as distributors that transship inventory through China to service other countries. |
Description of Business, Incl_6
Description of Business, Including Segment and Geographic Area Information - Schedule of Property, Plant and Equipment by Geographic Area (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | $ 3,303 | $ 3,183 | |
United States | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | 1,998 | 1,812 | |
Asia | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | [1] | 1,046 | 1,116 |
Europe, Middle East And Africa | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | 63 | 84 | |
Japan | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | 185 | 157 | |
Rest of world | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | 11 | 14 | |
Philippines | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | 394 | 437 | |
China | |||
Segment Reporting Information [Line Items] | |||
Total property, plant and equipment | $ 304 | $ 313 | |
[1] | Property, plant and equipment at our two sites in the Philippines was $394 million and $437 million as of December 31, 2019 and 2018, respectively. Property, plant and equipment at our sites in China was $304 million and $313 million as of December 31, 2019 and 2018, respectively. |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies and Practices - Additional Information (Details) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Advertising expense | $ 30 | $ 34 | $ 39 | |
Antidilutive securities excluded from computation of earnings per share, Amount (in shares) | 6 | 4 | 6 | |
Maximum length to maturity of a security, from the investment date, where it is classified as cash and cash equivalent | 90 days | |||
Length to maturity from the investment date of a security where the length of time is too short to be classified as a short-term investment | 90 days | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Lease liability | $ 332 | |||
Lease assets | $ 337 | |||
ASU 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Lease liability | $ 229 | |||
Lease assets | $ 229 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies and Practices - Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic EPS: | |||||||||||
Net income | $ 1,070 | $ 1,425 | $ 1,305 | $ 1,217 | $ 1,239 | $ 1,570 | $ 1,405 | $ 1,366 | $ 5,017 | $ 5,580 | $ 3,682 |
Income allocated to RSUs | (32) | (43) | (34) | ||||||||
Income allocated to common stock for basic EPS | $ 4,985 | $ 5,537 | $ 3,648 | ||||||||
Weighted average number of shares outstanding, basic (in shares) | 936 | 970 | 991 | ||||||||
Basic earnings per common share (in dollars per share) | $ 1.14 | $ 1.51 | $ 1.38 | $ 1.29 | $ 1.29 | $ 1.61 | $ 1.43 | $ 1.38 | $ 5.33 | $ 5.71 | $ 3.68 |
Dilutive effect of stock compensation plans | 16 | 20 | 21 | ||||||||
Diluted EPS: | |||||||||||
Net income | $ 1,070 | $ 1,425 | $ 1,305 | $ 1,217 | $ 1,239 | $ 1,570 | $ 1,405 | $ 1,366 | $ 5,017 | $ 5,580 | $ 3,682 |
Income allocated to RSUs | (31) | (42) | (33) | ||||||||
Income allocated to common stock for diluted EPS | $ 4,986 | $ 5,538 | $ 3,649 | ||||||||
Weighted average number of shares outstanding, diluted (in shares) | 952 | 990 | 1,012 | ||||||||
Diluted earnings per common share (in dollars per share) | $ 1.12 | $ 1.49 | $ 1.36 | $ 1.26 | $ 1.27 | $ 1.58 | $ 1.40 | $ 1.35 | $ 5.24 | $ 5.59 | $ 3.61 |
Stock Compensation - Additional
Stock Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 02, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Number of shares remaining available for future issuance (in shares) | 45,082,425 | |||
Future compensation not yet recognized in the Statements of Income | $ 226 | |||
Future compensation to be recognized in 2020 | 113 | |||
Future compensation to be recognized in 2021 | 72 | |||
Future compensation to be recognized in 2022 | 37 | |||
Future compensation to be recognized in 2023 | 4 | |||
Remaining stock repurchase authorizations | $ 13,180 | |||
Employee stock purchase plan | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Percent of the underlying common stock's market price participants pay for options (in hundredths) | 85.00% | |||
ESPP option term (in months) | three | |||
Number of shares remaining available for future issuance (in shares) | 33,812,282 | |||
Aggregate intrinsic values of options exercised | $ 13 | $ 13 | $ 13 | |
Weighted-average exercise price, Exercised (in dollars per share) | $ 94.30 | |||
Outstanding options exercisable (in shares) | 0 | |||
Weighted average grant date fair value of options granted (dollars per share) | $ 18.05 | $ 15.43 | $ 12.99 | |
Employee stock purchase plan | Subsequent Event | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Weighted-average exercise price, Exercised (in dollars per share) | $ 110.14 | |||
Long-term incentive and director compensation plans | Employee Stock Option | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Term of the long term incentive stock options | 10 years | |||
Award vesting period (in years) | 4 years | |||
Aggregate intrinsic values of options exercised | $ 819 | $ 561 | $ 632 | |
Future compensation not yet recognized in the Statements of Income | $ 98 | |||
Weighted-average exercise price, Exercised (in dollars per share) | $ 44.68 | |||
Outstanding options exercisable (in shares) | 19,646,782 | |||
Long-term incentive and director compensation plans | Restricted Stock Units (RSUs) | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Award vesting period (in years) | 4 years | |||
Weighted-average grant-date fair value, Granted (in dollars per share) | $ 106.58 | $ 110.05 | $ 79.52 | |
Total fair values of shares vested from RSU lapses | $ 125 | $ 123 | $ 149 | |
Future compensation not yet recognized in the Statements of Income | $ 128 |
Stock Compensation - Expense (D
Stock Compensation - Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock compensation | $ 217 | $ 232 | $ 242 |
COR | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock compensation | 21 | 25 | 36 |
R&D | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock compensation | 66 | 69 | 59 |
SG&A | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock compensation | $ 130 | $ 138 | $ 147 |
Stock Compensation - Fair-value
Stock Compensation - Fair-value Methods and Assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement [Abstract] | |||
Weighted average grant date fair value, per share (in dollars per share) | $ 22.08 | $ 23.20 | $ 16.49 |
Expected volatility (in percent) | 26.00% | 23.00% | 24.00% |
Expected lives | 7 years 1 month 6 days | 7 years 2 months 12 days | 7 years 2 months 12 days |
Risk-free interest rates (in percent) | 2.66% | 2.57% | 2.36% |
Expected dividend yields (in percent) | 2.95% | 2.25% | 2.52% |
Stock Compensation - Stock Opti
Stock Compensation - Stock Options and RSUs Outstanding (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employee Stock Option | |||
Stock Options, Shares | |||
Exercised (in shares) | (11,529,174) | (8,432,458) | (13,313,019) |
Employee Stock Option | Long-term incentive and director compensation plans | |||
Stock Options, Shares | |||
Options outstanding, Beginning balance (in shares) | 39,905,454 | ||
Granted (in shares) | 4,559,093 | ||
Exercised (in shares) | (11,529,174) | ||
Forfeited and expired (in shares) | (441,429) | ||
Options outstanding, Ending balance (in shares) | 32,493,944 | 39,905,454 | |
Stock Options, Weighted Average Exercise Price per Share | |||
Weighted-average exercise price, Outstanding, Beginning of period (in dollars per share) | $ 56.10 | ||
Weighted-average exercise price, Granted (in dollars per share) | 104.51 | ||
Weighted-average exercise price, Exercised (in dollars per share) | 44.68 | ||
Weighted-average exercise price, Forfeited and expired (in dollars per share) | 83.89 | ||
Weighted-average exercise price, Outstanding, End of period (in dollars per share) | $ 66.57 | $ 56.10 | |
Restricted Stock Units (RSUs) | |||
Restricted Stock Units, Shares | |||
Vested (in shares) | (2,370,762) | (2,769,994) | (4,419,464) |
Restricted Stock Units (RSUs) | Long-term incentive and director compensation plans | |||
Restricted Stock Units, Shares | |||
Awards outstanding other than options, Beginning balance (in shares) | 7,305,543 | ||
Granted (in shares) | 1,142,974 | ||
Vested (in shares) | (2,370,762) | ||
Forfeited and expired (in shares) | (179,955) | ||
Awards outstanding other than options, Ending balance (in shares) | 5,897,800 | 7,305,543 | |
Restricted Stock Units, Weighted Average Grant Date Fair Value per Share | |||
Weighted-average grant date fair value, Beginning of period (in dollars per share) | $ 66.72 | ||
Weighted-average grant-date fair value, Granted (in dollars per share) | 106.58 | $ 110.05 | $ 79.52 |
Weighted-average grant date fair value, Vested (in dollars per share) | 52.74 | ||
Weighted-average grant date fair value, Forfeited and expired (in dollars per share) | 81.57 | ||
Weighted-average grant date fair value, Ending of period (in dollars per share) | $ 79.62 | $ 66.72 |
Stock Compensation - Exercise P
Stock Compensation - Exercise Price Range (Details) - Employee Stock Option - Long-term incentive and director compensation plans - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Number Outstanding (Shares) | 32,493,944 | 39,905,454 |
Options Outstanding Weighted Average Exercise Price per Share (in dollars per share) | $ 66.57 | $ 56.10 |
23.05 to 127.35 | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Exercise Price Range, Minimum (in dollars per share) | 23.05 | |
Exercise Price Range, Maximum (in dollars per share) | $ 127.35 | |
Number Outstanding (Shares) | 32,493,944 | |
Weighted Average Remaining Contractual Life (Years) | 5 years 10 months 24 days | |
Options Outstanding Weighted Average Exercise Price per Share (in dollars per share) | $ 66.57 | |
Number Exercisable (Shares) | 19,646,782 | |
Options Exercisable Weighted Average Exercise Price per Share (in dollars per share) | $ 50.82 |
Stock Compensation - Options Ve
Stock Compensation - Options Vested and Expected to Vest (Details) - Long-term incentive and director compensation plans - Employee Stock Option $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2019USD ($)$ / sharesshares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of outstanding shares, vested and expected to vest (in shares) | shares | 32,001,396 | [1] |
Weighted average remaining contractual life, vested and expected to vest (in years) | 5 years 9 months 18 days | [1] |
Weighted average exercise price per share, vested and expected to vest (in dollars per share) | $ / shares | $ 66.03 | [1] |
Intrinsic value, vested and expected to vest (millions of dollars) | $ | $ 1,992 | [1] |
Outstanding options exercisable (in shares) | shares | 19,646,782 | |
Weighted average remaining contractual life, options exercisable | 4 years 7 months 6 days | |
Weighted average exercise price per share, options exercisable (in dollars per share) | $ / shares | $ 50.82 | |
Intrinsic value, options exercisable (millions of dollars) | $ | $ 1,522 | |
[1] | Includes effects of expected forfeitures. Excluding the effects of expected forfeitures, the aggregate intrinsic value of stock options outstanding was $2.01 billion. |
Stock Compensation - Options _2
Stock Compensation - Options Vested and Expected to Vest Additional Information (Details) $ in Millions | Dec. 31, 2019USD ($) |
Long-term incentive and director compensation plans | Employee Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Aggregate intrinsic value of stock options outstanding, excluding the effects of expected forfeitures | $ 2,010 |
Stock Compensation - ESPP (Deta
Stock Compensation - ESPP (Details) - Employee stock purchase plan | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Options outstanding, Beginning balance (in shares) | shares | 229,836 |
Granted (in shares) | shares | 742,819 |
Exercised (in shares) | shares | (798,806) |
Options outstanding, Ending balance (in shares) | shares | 173,849 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Weighted-average exercise price, Outstanding, Beginning of period (in dollars per share) | $ / shares | $ 80.29 |
Weighted-average exercise price, Granted (in dollars per share) | $ / shares | 102.34 |
Weighted-average exercise price, Exercised (in dollars per share) | $ / shares | 94.30 |
Weighted-average exercise price, Outstanding, End of period (in dollars per share) | $ / shares | $ 110.14 |
Stock Compensation - Effect on
Stock Compensation - Effect on Shares Outstanding and Treasury Shares (Details) - shares | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Treasury stock (in shares) | 808,784,381 | 795,665,646 | 757,657,217 | 744,831,978 |
Repurchases (in shares) | 27,398,701 | 49,482,220 | 30,570,129 | |
Total issued (in shares) | (14,208,395) | (11,468,610) | (17,740,140) | |
Director | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Director deferred stock units issued (in shares) | (71,571) | (5,181) | (4,750) | |
Employee Stock Option | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Exercised (in shares) | (11,529,174) | (8,432,458) | (13,313,019) | |
Stock applied to taxes (in shares) | 0 | 0 | 0 | |
Total issued (in shares) | (12,327,980) | (9,252,336) | (14,378,776) | |
Employee Stock Option | Director | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Director deferred stock units issued (in shares) | 0 | 0 | 0 | |
Restricted Stock Units (RSUs) | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Vested RSUs (in shares) | (2,370,762) | (2,769,994) | (4,419,464) | |
Stock applied to taxes (in shares) | 490,347 | 553,720 | 1,058,100 | |
Total issued (in shares) | (1,880,415) | (2,216,274) | (3,361,364) | |
Restricted Stock Units (RSUs) | Director | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Director deferred stock units issued (in shares) | 0 | 0 | 0 | |
Employee stock purchase plan | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Exercised (in shares) | (798,806) | |||
Employee stock purchase plan | Employee Stock Option | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Exercised (in shares) | (798,806) | (819,878) | (1,065,757) | |
Employee stock purchase plan | Restricted Stock Units (RSUs) | ||||
Change In Treasury Stock Roll Forward [Roll Forward] | ||||
Vested RSUs (in shares) | 0 | 0 | 0 |
Stock Compensation - Effects on
Stock Compensation - Effects on Cash Flows (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Share-based Payment Arrangement [Abstract] | ||||
Proceeds from common stock transactions | [1] | $ 539 | $ 373 | $ 483 |
Tax benefit realized from stock compensation | 224 | 179 | 341 | |
Reduction to deferred tax asset | (49) | (43) | (91) | |
Excess tax benefit for stock compensation | $ 175 | $ 136 | $ 250 | |
[1] | Net of taxes paid for employee shares withheld of $52 million, $60 million and $83 million in 2019, 2018 and 2017, respectively. |
Stock Compensation - Effects _2
Stock Compensation - Effects on Cash Flows Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement [Abstract] | |||
Taxes paid for employee shares withheld | $ 52 | $ 60 | $ 83 |
Income taxes - Income before in
Income taxes - Income before income taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Income before income taxes - U.S. | $ 4,915 | $ 5,672 | $ 5,130 |
Income before income taxes - Non-U.S. | 813 | 1,014 | 950 |
Income before income taxes | $ 5,728 | $ 6,686 | $ 6,080 |
Income taxes - Provision for in
Income taxes - Provision for income taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal - Current | $ 483 | $ 979 | $ 2,101 |
Non-U.S. - Current | 135 | 225 | 173 |
U.S. state - Current | 12 | 7 | 12 |
Total current income tax expense (benefit) | 630 | 1,211 | 2,286 |
U.S. federal - Deferred | 25 | (98) | 51 |
Non-U.S. - Deferred | 56 | (8) | 61 |
U.S. state - Deferred | 0 | 1 | 0 |
Total deferred income tax expense (benefit) | 81 | (105) | 112 |
Total U.S. federal income taxes | 508 | 881 | 2,152 |
Total Non-U.S. income taxes | 191 | 217 | 234 |
Total U.S. state income taxes | 12 | 8 | 12 |
Provision for income taxes | $ 711 | $ 1,106 | $ 2,398 |
Income taxes - Reconciliation i
Income taxes - Reconciliation items from U.S. statutory income tax rate to the effective tax rate (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. statutory income tax rate | 21.00% | 21.00% | 35.00% |
U.S. tax benefit for foreign derived intangible income | (4.90%) | (5.30%) | 0.00% |
U.S. excess tax benefit for stock compensation | (3.10%) | (2.00%) | (4.10%) |
U.S. R&D tax credit | (1.40%) | (1.30%) | (1.10%) |
Non-U.S. effective tax rates | 0.30% | 0.10% | (2.50%) |
U.S. Tax Act transitional non-cash expense | 0.00% | 4.20% | 0.00% |
U.S. Tax Act enactment-date effects and measurement period adjustments | 0.00% | (0.70%) | 12.70% |
U.S. tax benefit for manufacturing | 0.00% | 0.00% | (1.60%) |
Other | 0.50% | 0.50% | 1.00% |
Effective tax rate | 12.40% | 16.50% | 39.40% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Line Items] | ||||
Provisional Tax Act tax expense | $ 773,000,000 | |||
Reduction in provisional tax expense | $ 44,000,000 | |||
Additional tax expense | 729,000,000 | |||
Increase in valuation allowance balances | $ 8,000,000 | 7,000,000 | 37,000,000 | |
Net income impacted due to change in valuation allowances | 0 | 0 | ||
Tax loss carryforward, U.S. and non-U.S. | 6,000,000 | |||
Tax loss carryforward, U.S. and non-U.S., set to expire | 0 | |||
Cash payments for income taxes | 570,000,000 | 705,000,000 | 1,800,000,000 | |
Liabilities for uncertain tax positions | 303,000,000 | 286,000,000 | $ 300,000,000 | $ 243,000,000 |
Amount of deferred tax assets possibly to be realized | 2,000,000 | $ 30,000,000 | ||
Maximum | ||||
Income Tax Disclosure [Line Items] | ||||
Decrease in liabilities for uncertain tax positions | $ 249,000,000 |
Income taxes - Components of de
Income taxes - Components of deferred tax assets and liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Deferred loss and tax credit carryforwards | $ 213 | $ 247 |
Accrued expenses | 113 | 129 |
Stock compensation | 109 | 122 |
Inventories and related reserves | 109 | 107 |
Retirement costs for defined benefit and retiree health care | 49 | 80 |
Total deferred tax assets, before valuation allowance | 593 | 685 |
Valuation allowance | (180) | (172) |
Total deferred tax assets, after valuation allowance | 413 | 513 |
Deferred tax liabilities: | ||
Property, plant and equipment | (95) | (10) |
Acquisition-related intangibles and fair-value adjustments | (82) | (142) |
International earnings | (62) | (43) |
Other | (55) | (65) |
Total deferred tax liabilities | (294) | (260) |
Net deferred tax asset | $ 119 | $ 253 |
Income taxes - Deferred tax ass
Income taxes - Deferred tax assets and liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets | $ 197 | $ 295 |
Deferred tax liabilities | (78) | (42) |
Net deferred tax asset | $ 119 | $ 253 |
Income taxes - Uncertain tax po
Income taxes - Uncertain tax positions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance, January 1 | $ 286 | $ 300 | $ 243 |
Additions based on tax positions related to the current year | 3 | 3 | 17 |
Additions for tax positions of prior years | 63 | 1 | 42 |
Reductions for tax positions of prior years | (41) | 0 | (1) |
Settlements with tax authorities | (8) | (18) | (1) |
Balance, December 31 | 303 | 286 | 300 |
Interest income (expense) recognized in the year ended December 31 | 9 | (15) | (19) |
Interest payable as of December 31 | $ 44 | $ 49 | $ 38 |
Financial Instruments and Ris_2
Financial Instruments and Risk Concentration - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Carrying value of long term debt | $ 5,803 | $ 5,068 | |
Allowance for Credit Loss | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Accounts receivable allowances, amounts charged (credited) to operating results | (11) | $ 11 | $ (9) |
Level 2 | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Fair value of long term debt | 6,290 | ||
Foreign Exchange Forward | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Notional amount | 458 | ||
Foreign Exchange Forward | Japanese Yen | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Notional amount | 136 | ||
Foreign Exchange Forward | Indian Rupees | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Notional amount | 106 | ||
Foreign Exchange Forward | British Pounds | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Notional amount | $ 74 |
Valuation of Debt and Equity _3
Valuation of Debt and Equity Investments and Certain Liabilities - Investments at Fair Value (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | $ 2,437 | $ 2,438 |
Short-term investments | 2,950 | 1,795 |
Long-term investments | 300 | 251 |
Measured at fair value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 1,991 | 2,208 |
Short-term investments | 2,950 | 1,795 |
Long-term investments | 272 | 226 |
Measured at fair value | Available-for-sale debt securities | Money market funds | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 1,213 | 747 |
Short-term investments | 0 | 0 |
Long-term investments | 0 | 0 |
Measured at fair value | Available-for-sale debt securities | Corporate obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 174 | 473 |
Short-term investments | 1,216 | 748 |
Long-term investments | 0 | 0 |
Measured at fair value | Available-for-sale debt securities | U.S. government agency and Treasury securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 604 | 988 |
Short-term investments | 1,734 | 1,047 |
Long-term investments | 0 | 0 |
Measured at fair value | Trading securities | Mutual funds | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Long-term investments | 272 | 226 |
Other measurement basis | Equity-method investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Long-term investments | 24 | 21 |
Other measurement basis | Non-marketable equity investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Long-term investments | 4 | 4 |
Other measurement basis | Cash on hand | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | 446 | 230 |
Short-term investments | 0 | 0 |
Long-term investments | $ 0 | $ 0 |
Valuation of Debt and Equity _4
Valuation of Debt and Equity Investments and Certain Liabilities - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |||
Credit losses related to available-for-sale investments | $ 0 | $ 0 | $ 0 |
Proceeds from sales, redemptions and maturities of short-term available-for-sale securities | 2,309,000,000 | 6,708,000,000 | 4,095,000,000 |
Net gains (losses) from equity method investments | 32,000,000 | 5,000,000 | 4,000,000 |
Realized gains from sale of equity method investments | 29,000,000 | 11,000,000 | $ 6,000,000 |
Level 3 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Total assets fair value | 0 | 0 | |
Total liabilities fair value | 0 | 0 | |
Fair Value, Measurements, Recurring | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Total assets fair value | 5,213,000,000 | 4,229,000,000 | |
Total liabilities fair value | $ 298,000,000 | $ 246,000,000 |
Valuation of Debt and Equity _5
Valuation of Debt and Equity Investments and Certain Liabilities - Aggregate Maturities of Available-for-sale Debt Investments (Details) $ in Millions | Dec. 31, 2019USD ($) |
Fair Value Disclosures [Abstract] | |
One year or less | $ 4,921 |
One to two years | $ 20 |
Valuation of Debt and Equity _6
Valuation of Debt and Equity Investments and Certain Liabilities - Fair Value Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | $ 5,213 | $ 4,229 |
Liabilities, fair value | 298 | 246 |
Deferred compensation | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities, fair value | 298 | 246 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 3,823 | 3,008 |
Liabilities, fair value | 298 | 246 |
Level 1 | Deferred compensation | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities, fair value | 298 | 246 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 1,390 | 1,221 |
Liabilities, fair value | 0 | |
Level 2 | Deferred compensation | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities, fair value | 0 | 0 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 1,213 | 747 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 1,213 | 747 |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 0 | 0 |
Corporate obligations | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 1,390 | 1,221 |
Corporate obligations | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 0 | 0 |
Corporate obligations | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 1,390 | 1,221 |
U.S. government agency and Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 2,338 | 2,035 |
U.S. government agency and Treasury securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 2,338 | 2,035 |
U.S. government agency and Treasury securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 0 | 0 |
Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 272 | 226 |
Mutual funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | 272 | 226 |
Mutual funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, fair value | $ 0 | $ 0 |
Goodwill and Acquisition-Rela_3
Goodwill and Acquisition-Related Intangibles - Goodwill (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill [Line Items] | ||
Goodwill | $ 4,362 | $ 4,362 |
Analog | ||
Goodwill [Line Items] | ||
Goodwill | 4,158 | 4,158 |
Embedded Processing | ||
Goodwill [Line Items] | ||
Goodwill | 172 | 172 |
Other | ||
Goodwill [Line Items] | ||
Goodwill | $ 32 | $ 32 |
Goodwill and Acquisition-Rela_4
Goodwill and Acquisition-Related Intangibles - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill impairment loss | $ 0 | $ 0 | $ 0 |
Amortization of acquisition-related intangibles | $ 288,000,000 | $ 318,000,000 | $ 318,000,000 |
Goodwill and Acquisition-Rela_5
Goodwill and Acquisition-Related Intangibles - Components of Acquisition Related Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,000 | $ 2,935 |
Accumulated Amortization | 1,660 | 2,307 |
Net | 340 | 628 |
Finite-Lived Intangible Assets, Future Amortization Expense [Abstract] | ||
2020 | 198 | |
2021 | 142 | |
Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,000 | 2,125 |
Accumulated Amortization | 1,660 | 1,573 |
Net | $ 340 | 552 |
Developed technology | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period (Years) | 7 years | |
Developed technology | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period (Years) | 10 years | |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period (Years) | 8 years | |
Gross Carrying Amount | $ 0 | 810 |
Accumulated Amortization | 0 | 734 |
Net | $ 0 | $ 76 |
Postretirement Benefit Plans -
Postretirement Benefit Plans - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit pension plan formula, highest consecutive years of compensation (in years) | 5 years | ||
Value of the company shares held by the non-U.S. retirement plans at year-end | $ 28 | $ 23 | |
Length of time certain gains and losses are considered when determining the market-related value of assets related to the U.S. Qualified pension and retiree health care plans (in years) | 3 years | ||
Expected contribution to retirement benefit plans in next fiscal year | $ 20 | ||
Defined benefit plan assets directly invested in TI common stock (in shares) | 0 | ||
Liability to participants of the deferred compensation plan | $ 298 | ||
Deferred compensation plan assets | $ 272 | ||
U.S. | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Number of company shares held by the U.S. defined contribution plans at year-end (in shares) | 8,000,000 | 9,000,000 | |
Value of the company shares held by the U.S. defined contribution plans at year-end | $ 988 | $ 821 | |
Dividends paid on the company shares held by the U.S. defined contribution plans at year-end | 26 | 24 | |
Aggregate expense for the U.S. defined contribution plans | 61 | 61 | $ 61 |
U.S. | Defined benefit plan | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Accumulated benefit obligation | 878 | 793 | |
Non-U.S. | Defined benefit plan | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Accumulated benefit obligation | $ 2,460 | $ 2,290 | |
Defined contribution plan, also still accruing defined benefits | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined contribution plan, employer matching contribution (percent) | 2.00% | ||
Enhanced defined contribution plan | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined contribution plan, employer matching contribution (percent) | 4.00% | ||
Defined contribution plan, employer fixed contribution (percent) | 2.00% | ||
Defined contribution plan | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined contribution plan, employer fixed contribution (percent) | 2.00% |
Postretirement Benefit Plans _2
Postretirement Benefit Plans - Expense Related to Defined Benefit and Retiree Health Care Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
U.S. | Defined benefit plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | $ 18 | $ 19 | $ 22 |
Interest cost | 38 | 35 | 42 |
Expected return on plan assets | (41) | (42) | (41) |
Amortization of prior service cost (credit) | 0 | 0 | 0 |
Recognized net actuarial loss | 9 | 17 | 14 |
Net periodic benefit costs | 24 | 29 | 37 |
Settlement losses | 10 | 23 | 36 |
Total, including other postretirement losses | 34 | 52 | 73 |
U.S. | Retiree health care plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 3 | 5 | 5 |
Interest cost | 14 | 15 | 17 |
Expected return on plan assets | (14) | (15) | (17) |
Amortization of prior service cost (credit) | (1) | (3) | (4) |
Recognized net actuarial loss | 0 | 2 | 3 |
Net periodic benefit costs | 2 | 4 | 4 |
Settlement losses | 0 | 0 | 0 |
Total, including other postretirement losses | 2 | 4 | 4 |
Non-U.S. | Defined benefit plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 31 | 36 | 37 |
Interest cost | 43 | 45 | 44 |
Expected return on plan assets | (86) | (67) | (62) |
Amortization of prior service cost (credit) | 1 | (1) | (2) |
Recognized net actuarial loss | 29 | 20 | 28 |
Net periodic benefit costs | 18 | 33 | 45 |
Settlement losses | 3 | 3 | 2 |
Total, including other postretirement losses | $ 21 | $ 36 | $ 47 |
Postretirement Benefit Plans _3
Postretirement Benefit Plans - Benefit Obligations and Plan Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Change in plan assets | |||
Funded status at end of year | $ 104 | $ (37) | |
U.S. | Defined benefit plan | |||
Change in plan benefit obligation | |||
Benefit obligation at beginning of year | 874 | 998 | |
Service cost | 18 | 19 | $ 22 |
Interest cost | 38 | 35 | 42 |
Participant contributions | 0 | 0 | |
Benefits paid | (11) | (10) | |
Settlements | (66) | (100) | |
Curtailments | 0 | 0 | |
Actuarial loss (gain) | 107 | (68) | |
Plan amendments | 0 | 0 | |
Effects of exchange rate changes | 0 | 0 | |
Benefit obligation at end of year | 960 | 874 | 998 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 869 | 995 | |
Actual return on plan assets | 185 | (56) | |
Employer contributions (qualified plans) | 0 | 20 | |
Employer contributions (non-qualified plans) | 10 | 20 | |
Participant contributions | 0 | 0 | |
Benefits paid | (11) | (10) | |
Settlements | (66) | (100) | |
Effects of exchange rate changes | 0 | 0 | |
Other | 0 | 0 | |
Fair value of plan assets at end of year | 987 | 869 | 995 |
Funded status at end of year | 27 | (5) | |
U.S. | Retiree health care plan | |||
Change in plan benefit obligation | |||
Benefit obligation at beginning of year | 361 | 414 | |
Service cost | 3 | 5 | |
Interest cost | 14 | 15 | |
Participant contributions | 13 | 11 | |
Benefits paid | (41) | (41) | |
Settlements | 0 | 0 | |
Curtailments | 0 | 0 | |
Actuarial loss (gain) | 9 | (43) | |
Plan amendments | 0 | 0 | |
Effects of exchange rate changes | 0 | 0 | |
Benefit obligation at end of year | 359 | 361 | 414 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 330 | 394 | |
Actual return on plan assets | 53 | (12) | |
Employer contributions (qualified plans) | 1 | 1 | |
Employer contributions (non-qualified plans) | 0 | 0 | |
Participant contributions | 13 | 11 | |
Benefits paid | (41) | (41) | |
Settlements | 0 | 0 | |
Effects of exchange rate changes | 0 | 0 | |
Other | 0 | (23) | |
Fair value of plan assets at end of year | 356 | 330 | 394 |
Funded status at end of year | (3) | (31) | |
Non-U.S. | Defined benefit plan | |||
Change in plan benefit obligation | |||
Benefit obligation at beginning of year | 2,411 | 2,469 | |
Service cost | 31 | 36 | 37 |
Interest cost | 43 | 45 | 44 |
Participant contributions | 7 | 7 | |
Benefits paid | (103) | (87) | |
Settlements | (12) | (16) | |
Curtailments | (1) | 0 | |
Actuarial loss (gain) | 193 | 6 | |
Plan amendments | 0 | 7 | |
Effects of exchange rate changes | 12 | (56) | |
Benefit obligation at end of year | 2,581 | 2,411 | 2,469 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 2,410 | 2,593 | |
Actual return on plan assets | 337 | (52) | |
Employer contributions (qualified plans) | 9 | 19 | |
Employer contributions (non-qualified plans) | 0 | 0 | |
Participant contributions | 7 | 7 | |
Benefits paid | (103) | (87) | |
Settlements | (12) | (16) | |
Effects of exchange rate changes | 13 | (54) | |
Other | 0 | 0 | |
Fair value of plan assets at end of year | 2,661 | 2,410 | $ 2,593 |
Funded status at end of year | $ 80 | $ (1) |
Postretirement Benefit Plans _4
Postretirement Benefit Plans - Amounts Recognized on our Balance Sheet (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||
Overfunded retirement plans | $ 218 | $ 92 |
Accrued expenses and other liabilities & other long-term liabilities | (21) | (11) |
Underfunded retirement plans | (93) | (118) |
Funded status at end of year | 104 | (37) |
U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Overfunded retirement plans | 73 | 40 |
Accrued expenses and other liabilities & other long-term liabilities | (17) | (8) |
Underfunded retirement plans | (29) | (37) |
Funded status at end of year | 27 | (5) |
U.S. | Retiree health care plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Overfunded retirement plans | 0 | 0 |
Accrued expenses and other liabilities & other long-term liabilities | 0 | 0 |
Underfunded retirement plans | (3) | (31) |
Funded status at end of year | (3) | (31) |
Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Overfunded retirement plans | 145 | 52 |
Accrued expenses and other liabilities & other long-term liabilities | (4) | (3) |
Underfunded retirement plans | (61) | (50) |
Funded status at end of year | $ 80 | $ (1) |
Postretirement Benefit Plans _5
Postretirement Benefit Plans - Schedule of Change in AOCI (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Defined benefit plan amounts recognized in other comprehensive income net actuarial loss portion roll forward | |
AOCI balance, net actuarial loss portion (net of taxes), beginning of period | $ 473 |
Adjustments, net actuarial loss | (125) |
Recognized within net income, net actuarial loss | (51) |
Tax effect, net actuarial loss | 50 |
Total change to AOCI, net actuarial loss | (126) |
AOCI balance, net actuarial loss portion (net of taxes), period end | 347 |
Defined benefit plan amounts recognized in other comprehensive income prior service credit portion roll forward | |
AOCI balance, net prior service credit (net of taxes), beginning of period | (2) |
Adjustments, prior service credit | 0 |
Recognized within net income, prior service credit | 0 |
Tax effect, prior service credit | 0 |
Total change to AOCI, prior service credit | 0 |
AOCI balance, net prior service credit (net of taxes), period end | (2) |
U.S. | Defined benefit plan | |
Defined benefit plan amounts recognized in other comprehensive income net actuarial loss portion roll forward | |
AOCI balance, net actuarial loss portion (net of taxes), beginning of period | 135 |
Adjustments, net actuarial loss | (36) |
Recognized within net income, net actuarial loss | (19) |
Tax effect, net actuarial loss | 11 |
Total change to AOCI, net actuarial loss | (44) |
AOCI balance, net actuarial loss portion (net of taxes), period end | 91 |
U.S. | Retiree health care plan | |
Defined benefit plan amounts recognized in other comprehensive income net actuarial loss portion roll forward | |
AOCI balance, net actuarial loss portion (net of taxes), beginning of period | 21 |
Adjustments, net actuarial loss | (31) |
Recognized within net income, net actuarial loss | 0 |
Tax effect, net actuarial loss | 7 |
Total change to AOCI, net actuarial loss | (24) |
AOCI balance, net actuarial loss portion (net of taxes), period end | (3) |
Defined benefit plan amounts recognized in other comprehensive income prior service credit portion roll forward | |
AOCI balance, net prior service credit (net of taxes), beginning of period | (5) |
Adjustments, prior service credit | 0 |
Recognized within net income, prior service credit | 1 |
Tax effect, prior service credit | 0 |
Total change to AOCI, prior service credit | 1 |
AOCI balance, net prior service credit (net of taxes), period end | (4) |
Non-U.S. | Defined benefit plan | |
Defined benefit plan amounts recognized in other comprehensive income net actuarial loss portion roll forward | |
AOCI balance, net actuarial loss portion (net of taxes), beginning of period | 317 |
Adjustments, net actuarial loss | (58) |
Recognized within net income, net actuarial loss | (32) |
Tax effect, net actuarial loss | 32 |
Total change to AOCI, net actuarial loss | (58) |
AOCI balance, net actuarial loss portion (net of taxes), period end | 259 |
Defined benefit plan amounts recognized in other comprehensive income prior service credit portion roll forward | |
AOCI balance, net prior service credit (net of taxes), beginning of period | 3 |
Adjustments, prior service credit | 0 |
Recognized within net income, prior service credit | (1) |
Tax effect, prior service credit | 0 |
Total change to AOCI, prior service credit | (1) |
AOCI balance, net prior service credit (net of taxes), period end | $ 2 |
Postretirement Benefit Plans _6
Postretirement Benefit Plans - Plan Assets by Level Three Hierarchy (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | $ 987 | $ 869 | $ 995 | |
U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 356 | 330 | 394 | |
Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 2,661 | 2,410 | $ 2,593 | |
Other | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 987 | 869 | |
Other | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 294 | 271 | |
Other | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 2,433 | 2,190 | |
Level 1 | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Level 1 | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 62 | 59 | ||
Level 1 | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 100 | 80 | ||
Level 2 | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Level 2 | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Level 2 | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 128 | 140 | ||
Fixed income securities and cash equivalents | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 640 | 563 | ||
Fixed income securities and cash equivalents | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 230 | 214 | ||
Fixed income securities and cash equivalents | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 1,947 | 1,788 | ||
Fixed income securities and cash equivalents | Other | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 640 | 563 | |
Fixed income securities and cash equivalents | Other | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 168 | 155 | |
Fixed income securities and cash equivalents | Other | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 1,762 | 1,602 | |
Fixed income securities and cash equivalents | Level 1 | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Fixed income securities and cash equivalents | Level 1 | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 62 | 59 | ||
Fixed income securities and cash equivalents | Level 1 | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 59 | 47 | ||
Fixed income securities and cash equivalents | Level 2 | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Fixed income securities and cash equivalents | Level 2 | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Fixed income securities and cash equivalents | Level 2 | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 126 | 139 | ||
Equity securities | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 347 | 306 | ||
Equity securities | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 126 | 116 | ||
Equity securities | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 714 | 622 | ||
Equity securities | Other | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 347 | 306 | |
Equity securities | Other | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 126 | 116 | |
Equity securities | Other | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | [1] | 671 | 588 | |
Equity securities | Level 1 | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Equity securities | Level 1 | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Equity securities | Level 1 | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 41 | 33 | ||
Equity securities | Level 2 | U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Equity securities | Level 2 | U.S. | Retiree health care plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | 0 | 0 | ||
Equity securities | Level 2 | Non-U.S. | Defined benefit plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of plan assets | $ 2 | $ 1 | ||
[1] | Consists of bond index and equity index funds, measured at net asset value per share, as well as cash equivalents. |
Postretirement Benefit Plans _7
Postretirement Benefit Plans - Weighted Average Assumptions Used (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
U.S. | Defined benefit plan | ||
Weighted average assumptions used to determine benefit obligations: | ||
Discount rate (in percent) | 3.62% | 4.37% |
Long-term pay progression (in percent) | 3.30% | 3.30% |
Weighted average assumptions used to determine net periodic benefit cost: | ||
Discount rate (in percent) | 4.35% | 3.77% |
Long term rate of return on plan assets (in percent) | 4.90% | 4.80% |
Long-term pay progression (in percent) | 3.30% | 3.30% |
U.S. | Retiree health care plan | ||
Weighted average assumptions used to determine benefit obligations: | ||
Discount rate (in percent) | 3.63% | 4.30% |
Weighted average assumptions used to determine net periodic benefit cost: | ||
Discount rate (in percent) | 4.30% | 3.63% |
Long term rate of return on plan assets (in percent) | 4.40% | 4.10% |
Non-U.S. | Defined benefit plan | ||
Weighted average assumptions used to determine benefit obligations: | ||
Discount rate (in percent) | 1.46% | 1.85% |
Long-term pay progression (in percent) | 3.06% | 2.96% |
Weighted average assumptions used to determine net periodic benefit cost: | ||
Discount rate (in percent) | 1.85% | 1.84% |
Long term rate of return on plan assets (in percent) | 3.62% | 2.58% |
Long-term pay progression (in percent) | 3.03% | 2.96% |
Postretirement Benefit Plans _8
Postretirement Benefit Plans - Weighted Average Allocations (Details) | Dec. 31, 2019 | Dec. 31, 2018 |
Fixed income securities and cash equivalents | U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 65.00% | |
Actual plan asset allocation (in percent) | 65.00% | 65.00% |
Fixed income securities and cash equivalents | U.S. | Retiree health care plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 65.00% | |
Actual plan asset allocation (in percent) | 65.00% | 65.00% |
Fixed income securities and cash equivalents | Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocation (in percent) | 73.00% | 74.00% |
Fixed income securities and cash equivalents | Minimum | Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 60.00% | |
Fixed income securities and cash equivalents | Maximum | Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 100.00% | |
Equity securities | U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 35.00% | |
Actual plan asset allocation (in percent) | 35.00% | 35.00% |
Equity securities | U.S. | Retiree health care plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 35.00% | |
Actual plan asset allocation (in percent) | 35.00% | 35.00% |
Equity securities | Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual plan asset allocation (in percent) | 27.00% | 26.00% |
Equity securities | Minimum | Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 0.00% | |
Equity securities | Maximum | Non-U.S. | Defined benefit plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Targeted allocation (in percent) | 40.00% |
Postretirement Benefit Plans _9
Postretirement Benefit Plans - Assumed Future Benefits Payments (Details) $ in Millions | Dec. 31, 2019USD ($) |
U.S. | Defined benefit plan | |
Defined Benefit Plan Disclosure [Line Items] | |
2020 | $ 99 |
2021 | 118 |
2022 | 85 |
2023 | 90 |
2024 | 87 |
2025 - 2029 | 441 |
U.S. | Retiree health care plan | |
Defined Benefit Plan Disclosure [Line Items] | |
2020 | 32 |
2021 | 30 |
2022 | 29 |
2023 | 27 |
2024 | 26 |
2025 - 2029 | 115 |
Non-U.S. | Defined benefit plan | |
Defined Benefit Plan Disclosure [Line Items] | |
2020 | 95 |
2021 | 96 |
2022 | 99 |
2023 | 100 |
2024 | 104 |
2025 - 2029 | $ 542 |
Postretirement Benefit Plans_10
Postretirement Benefit Plans - Health Care Cost Trend Rates (Details) - U.S. - Retiree health care plan | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Assumed health care cost trend rate for next year (in percent) | 7.00% | 7.25% |
Ultimate trend rate (in percent) | 5.00% | 5.00% |
Year in which ultimate trend rate is reached | 2028 | 2028 |
Debt and Lines of Credit - Addi
Debt and Lines of Credit - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2019 | May 31, 2018 | Nov. 30, 2017 | Jun. 30, 2017 | May 31, 2017 | Mar. 31, 2017 | Sep. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||||||||||||
Debt repaid | $ 500,000,000 | $ 375,000,000 | $ 250,000,000 | |||||||||
Principal amount | $ 600,000,000 | |||||||||||
Payments of debt issuance costs | 3,000,000 | |||||||||||
Proceeds from issuance of long-term debt | 605,000,000 | $ 1,491,000,000 | $ 1,500,000,000 | $ 1,099,000,000 | ||||||||
Interest and debt expense | 170,000,000 | 125,000,000 | 78,000,000 | |||||||||
Interest paid | $ 156,000,000 | $ 114,000,000 | $ 75,000,000 | |||||||||
Notes due 2019 at 1.65% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt repaid | $ 750,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 1.65% | |||||||||||
Notes due 2039 at 3.875% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 750,000,000 | |||||||||||
Payments of debt issuance costs | 7,000,000 | |||||||||||
Proceeds from issuance of long-term debt | $ 743,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 3.875% | |||||||||||
Notes due 2029 at 2.25% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 750,000,000 | |||||||||||
Payments of debt issuance costs | 5,000,000 | |||||||||||
Proceeds from issuance of long-term debt | $ 748,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 2.25% | |||||||||||
Notes due 2048 at 4.15% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 1,500,000,000 | |||||||||||
Payments of debt issuance costs | 16,000,000 | |||||||||||
Proceeds from issuance of long-term debt | 1,500,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 4.15% | |||||||||||
4.15% Notes issued in May 2018 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 1,300,000,000 | |||||||||||
4.15% Notes issued in June 2018 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 200,000,000 | |||||||||||
Notes due 2021 at 2.75% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 300,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 2.75% | 2.75% | ||||||||||
Notes due 2024 at 2.625% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 300,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 2.625% | 2.625% | ||||||||||
Notes due 2027 at 2.90% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 500,000,000 | |||||||||||
Payments of debt issuance costs | 3,000,000 | |||||||||||
Proceeds from issuance of long-term debt | $ 494,000,000 | |||||||||||
Long-term debt stated interest rate (in percentage) | 2.90% | |||||||||||
Revolving credit facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 2,000,000,000 |
Debt and Lines of Credit - Sche
Debt and Lines of Credit - Schedule of Long-term Debt Outstanding (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | May 31, 2017 |
Debt Instrument [Line Items] | |||
Total debt | $ 5,850 | $ 5,100 | |
Net unamortized discounts, premiums and issuance costs | (47) | (32) | |
Total debt, including net unamortized discounts, premiums and issuance costs | 5,803 | 5,068 | |
Current portion of long-term debt | (500) | (749) | |
Long-term debt | $ 5,303 | 4,319 | |
Notes due 2019 at 1.65% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 1.65% | ||
Total debt | $ 0 | 750 | |
Notes due 2020 at 1.75% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 1.75% | ||
Total debt | $ 500 | 500 | |
Notes due 2021 at 2.75% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 2.75% | 2.75% | |
Total debt | $ 550 | 550 | |
Notes due 2022 at 1.85% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 1.85% | ||
Total debt | $ 500 | 500 | |
Notes due 2023 at 2.25% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 2.25% | ||
Total debt | $ 500 | 500 | |
Notes due 2024 at 2.625% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 2.625% | 2.625% | |
Total debt | $ 300 | 300 | |
Notes due 2027 at 2.90% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 2.90% | ||
Total debt | $ 500 | 500 | |
Notes due 2029 at 2.25% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 2.25% | ||
Total debt | $ 750 | 0 | |
Notes due 2039 at 3.875% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 3.875% | ||
Total debt | $ 750 | 0 | |
Notes due 2048 at 4.15% | |||
Debt Instrument [Line Items] | |||
Long-term debt stated interest rate (in percentage) | 4.15% | ||
Total debt | $ 1,500 | $ 1,500 |
Leases - Component of Balance S
Leases - Component of Balance Sheet Information Related to Leases (Details) $ in Millions | Dec. 31, 2019USD ($) |
Leases [Abstract] | |
Other long-term assets | $ 337 |
Accrued expenses and other liabilities | 73 |
Operating lease liabilities | $ 259 |
Leases - Schedule of Operating
Leases - Schedule of Operating Leases (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Lease cost related to lease liabilities | $ 66 |
Variable lease cost | 41 |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows for lease cost | 60 |
Lease assets obtained in exchange for new lease liabilities | $ 167 |
Weighted average remaining lease term | 8 years 2 months 12 days |
Weighted average discount rate | 3.37% |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Lease Liabilities (Details) $ in Millions | Dec. 31, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 75 |
2021 | 63 |
2022 | 51 |
2023 | 38 |
2024 | 28 |
Thereafter | 131 |
Total | 386 |
Imputed lease interest | (54) |
Total lease liabilities | $ 332 |
Leases - Maturities Under Topic
Leases - Maturities Under Topic 840 (Details) $ in Millions | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 56 |
2020 | 46 |
2021 | 36 |
2022 | 29 |
2023 | 18 |
Thereafter | 39 |
Total | $ 224 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Millions | Dec. 31, 2019USD ($) |
Purchase Commitments | |
2020 | $ 452 |
2021 | 286 |
2022 | 121 |
2023 | 70 |
2024 | 27 |
Thereafter | 109 |
Total | $ 1,065 |
Supplemental financial inform_3
Supplemental financial information - Restructuring charges and other (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disclosure Text Block Supplement [Abstract] | ||||||||||||
Restructuring charges | [1] | $ (15) | $ 6 | $ 11 | ||||||||
Gains on sales of assets | (21) | (3) | 0 | |||||||||
Restructuring charges/other | $ 0 | $ 0 | $ (36) | $ 0 | $ (2) | $ 1 | $ 3 | $ 1 | $ (36) | $ 3 | $ 11 | |
[1] | Includes severance and benefits, accelerated depreciation, changes in estimates or other exit costs. |
Supplemental financial inform_4
Supplemental financial information - Restructuring balances (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Restructuring Reserve [Roll Forward] | ||||
Balance, January 1 | $ 28 | $ 29 | $ 40 | |
Restructuring charges | [1] | (15) | 6 | 11 |
Non-cash items | [2] | 0 | (3) | (1) |
Payments | (13) | (4) | (21) | |
Balance, December 31 | $ 0 | $ 28 | $ 29 | |
[1] | Includes severance and benefits, accelerated depreciation, changes in estimates or other exit costs. | |||
[2] | Reflects charges for impacts of accelerated depreciation and changes in exchange rates. |
Supplemental Financial Inform_5
Supplemental Financial Information - Narrative (Details) | 1 Months Ended |
Dec. 31, 2019factory | |
Restructuring Cost and Reserve [Line Items] | |
Number of factories closing | 2 |
Minimum | |
Restructuring Cost and Reserve [Line Items] | |
Expected length of restructuring plan | 3 years |
Maximum | |
Restructuring Cost and Reserve [Line Items] | |
Expected length of restructuring plan | 5 years |
Supplemental financial inform_6
Supplemental financial information - Other income (expense), net (OI&E) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disclosure Text Block Supplement [Abstract] | ||||
Other income | [1] | $ 197 | $ 150 | $ 163 |
Other expense | [2] | (22) | (52) | (88) |
Total | $ 175 | $ 98 | $ 75 | |
[1] | Other income includes interest, royalty and lease income, as well as investment gains and losses. | |||
[2] | Other expense includes a portion of pension and other retiree benefit costs. It also includes currency gains and losses, tax interest and miscellaneous items. |
Supplemental financial inform_7
Supplemental financial information - Property, plant and equipment at cost (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost | $ 5,740 | $ 5,425 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost | 126 | 128 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost | $ 2,504 | 2,497 |
Buildings and improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost, depreciable lives | 5 years | |
Buildings and improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost, depreciable lives | 40 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost | $ 3,110 | $ 2,800 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost, depreciable lives | 2 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment at cost, depreciable lives | 10 years |
Supplemental financial inform_8
Supplemental financial information - Other long-term liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure Text Block Supplement [Abstract] | ||
Long-term portion of transition tax on indefinitely reinvested earnings | $ 506 | $ 506 |
Uncertain tax positions | 303 | 286 |
Deferred compensation plans | 298 | 246 |
Operating lease liabilities | 259 | |
Other | 148 | 152 |
Total | $ 1,514 | $ 1,190 |
Supplemental financial inform_9
Supplemental financial information - Accumulated other comprehensive income (loss), net of taxes (AOCI) (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | $ 8,907 | $ 8,994 | ||
AOCI | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | (347) | (473) | $ (384) | $ (526) |
Net actuarial loss | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | (347) | (473) | ||
Prior service credit | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | 2 | 2 | ||
Cash flow hedge derivative instruments - post adoption | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | $ (2) | |||
Cash flow hedge derivative instruments - pre adoption | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Total | $ (2) |
Supplemental financial infor_10
Supplemental financial information - Amounts reclassified out of accumulated other comprehensive income (loss), net of taxes, to net income (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Other income (expense), net (OI&E) | $ 175 | $ 98 | $ 75 | |||||||||
Interest and debt expense | 170 | 125 | 78 | |||||||||
Provision for income taxes | (711) | (1,106) | (2,398) | |||||||||
Net income | $ 1,070 | $ 1,425 | $ 1,305 | $ 1,217 | $ 1,239 | $ 1,570 | $ 1,405 | $ 1,366 | 5,017 | 5,580 | 3,682 | |
Reclassification out of Accumulated Other Comprehensive Income | Net actuarial losses of defined benefit plans: | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Other income (expense), net (OI&E) | [1] | 51 | 65 | 83 | ||||||||
Provision for income taxes | (13) | (15) | (27) | |||||||||
Net income | 38 | 50 | 56 | |||||||||
Reclassification out of Accumulated Other Comprehensive Income | Prior service credit of defined benefit plans: | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Other income (expense), net (OI&E) | [1] | 0 | (4) | (6) | ||||||||
Provision for income taxes | 0 | 1 | 1 | |||||||||
Net income | 0 | (3) | (5) | |||||||||
Reclassification out of Accumulated Other Comprehensive Income | Derivative instruments - post adoption | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Interest and debt expense | 0 | |||||||||||
Provision for income taxes | 0 | |||||||||||
Net income | $ 0 | |||||||||||
Reclassification out of Accumulated Other Comprehensive Income | Derivative instruments - pre adoption | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Interest and debt expense | 0 | 1 | ||||||||||
Provision for income taxes | 0 | 0 | ||||||||||
Net income | $ 0 | $ 1 | ||||||||||
[1] | Detailed in Note 8. |
Quarterly financial data (una_3
Quarterly financial data (unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 3,350 | $ 3,771 | $ 3,668 | $ 3,594 | $ 3,717 | $ 4,261 | $ 4,017 | $ 3,789 | $ 14,383 | $ 15,784 | $ 14,961 |
Gross profit | 2,097 | 2,446 | 2,360 | 2,261 | 2,407 | 2,804 | 2,619 | 2,447 | 9,164 | 10,277 | 9,614 |
Acquisition charges | 50 | 79 | 80 | 79 | 79 | 80 | 79 | 80 | 288 | 318 | 318 |
Restructuring charges/other | 0 | 0 | (36) | 0 | (2) | 1 | 3 | 1 | (36) | 3 | 11 |
Operating profit | 1,249 | 1,589 | 1,506 | 1,379 | 1,516 | 1,937 | 1,712 | 1,548 | 5,723 | 6,713 | 6,083 |
Net income | $ 1,070 | $ 1,425 | $ 1,305 | $ 1,217 | $ 1,239 | $ 1,570 | $ 1,405 | $ 1,366 | $ 5,017 | $ 5,580 | $ 3,682 |
Basic earnings per common share (in dollars per share) | $ 1.14 | $ 1.51 | $ 1.38 | $ 1.29 | $ 1.29 | $ 1.61 | $ 1.43 | $ 1.38 | $ 5.33 | $ 5.71 | $ 3.68 |
Diluted earnings per common share (in dollars per share) | $ 1.12 | $ 1.49 | $ 1.36 | $ 1.26 | $ 1.27 | $ 1.58 | $ 1.40 | $ 1.35 | $ 5.24 | $ 5.59 | $ 3.61 |