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Segment Information (Unaudited)
 3 Months Ended
Mar. 31, 2021
Segment Reporting [Abstract]  
SEGMENT INFORMATION SEGMENT INFORMATION
The following table presents sales and operating income by segment:
Three Months Ended March 31
$ in millions20212020
Sales
Aeronautics Systems$2,990 $2,843 
Defense Systems1,562 1,881 
Mission Systems2,589 2,347 
Space Systems2,521 1,948 
Intersegment eliminations(505)(399)
Total sales9,157 8,620 
Operating income
Aeronautics Systems308 263 
Defense Systems177 198 
Mission Systems397 353 
Space Systems276 202 
Intersegment eliminations(63)(49)
Total segment operating income1,095 967 
FAS/CAS operating adjustment19 105 
Unallocated corporate income (expense)1,708 (138)
Total operating income$2,822 $934 
FAS/CAS Operating Adjustment
For financial statement purposes, we account for our employee pension plans in accordance with FAS. However, the cost of these plans is charged to our contracts in accordance with the Federal Acquisition Regulation (FAR) and the related U.S. Government Cost Accounting Standards (CAS). The FAS/CAS operating adjustment, previously referred to as the net FAS (service)/CAS pension adjustment, reflects the difference between CAS pension expense included as cost in segment operating income and the service cost component of FAS expense included in total operating income.
Unallocated Corporate Income (Expense)
Unallocated corporate income (expense) includes the portion of corporate costs not considered allowable or allocable under applicable CAS or FAR, and therefore not allocated to the segments, such as a portion of management and administration, legal, environmental, compensation, retiree benefits, advertising and other corporate unallowable costs. Unallocated corporate income (expense) also includes costs not considered part of management’s evaluation of segment operating performance, such as amortization of purchased intangible assets and the additional depreciation expense related to the step-up in fair value of property, plant and equipment acquired through business combinations, as well as certain compensation and other costs.
During the first quarter of 2021, the $2.0 billion pre-tax gain on the sale of our IT services business and $192 million of unallowable state taxes and transaction costs associated with the divestiture were recorded in Unallocated corporate income (expense).
Disaggregation of Revenue
Sales by Customer TypeThree Months Ended March 31
20212020
$ in millions$
%(3)
$
%(3)
Aeronautics Systems
U.S. government(1)
$2,541 85 %$2,361 83 %
International(2)
399 14 %444 16 %
Other customers6 — %12 — %
Intersegment sales44 1 %26 1 %
Aeronautics Systems sales2,990 100 %2,843 100 %
Defense Systems
U.S. government(1)
993 64 %1,259 67 %
International(2)
351 22 %340 18 %
Other customers33 2 %111 6 %
Intersegment sales185 12 %171 9 %
Defense Systems sales1,562 100 %1,881 100 %
Mission Systems
U.S. government(1)
1,834 71 %1,671 71 %
International(2)
502 19 %483 21 %
Other customers16 1 %17 1 %
Intersegment sales237 9 %176 7 %
Mission Systems sales2,589 100 %2,347 100 %
Space Systems
U.S. government(1)
2,326 92 %1,803 93 %
International(2)
105 4 %68 3 %
Other customers51 2 %51 3 %
Intersegment sales39 2 %26 1 %
Space Systems sales2,521 100 %1,948 100 %
Total
U.S. government(1)
7,694 84 %7,094 83 %
International(2)
1,357 15 %1,335 15 %
Other customers106 1 %191 2 %
Total Sales$9,157 100 %$8,620 100 %
(1) Sales to the U.S. government include sales from contracts for which we are the prime contractor, as well as those for which we are a subcontractor and the ultimate customer is the U.S. government. Each of the company’s segments derives substantial revenue from the U.S. government.
(2) International sales include sales from contracts for which we are the prime contractor, as well as those for which we are a subcontractor and the ultimate customer is an international customer. These sales include foreign military sales contracted through the U.S. government.
(3) Percentages calculated based on total segment sales.
Sales by Contract TypeThree Months Ended March 31
2021 2020
$ in millions$
%(1)
$
%(1)
Aeronautics Systems     
Cost-type$1,411 48 %$1,343 48 %
Fixed-price1,535 52 %1,474 52 %
Intersegment sales44 26 
Aeronautics Systems sales2,990 2,843 
Defense Systems
Cost-type509 37 %628 37 %
Fixed-price868 63 %1,082 63 %
Intersegment sales185 171 
Defense Systems sales1,562 1,881 
Mission Systems
Cost-type865 37 %846 39 %
Fixed-price1,487 63 %1,325 61 %
Intersegment sales237 176 
Mission Systems sales2,589 2,347 
Space Systems
Cost-type1,844 74 %1,398 73 %
Fixed-price638 26 %524 27 %
Intersegment sales39 26 
Space Systems sales2,521 1,948 
Total
Cost-type4,629 51 %4,215 49 %
Fixed-price4,528 49 %4,405 51 %
Total Sales$9,157 $8,620 
(1)Percentages calculated based on external customer sales.
Sales by Geographic RegionThree Months Ended March 31
20212020
$ in millions$
%(2)
$
%(2)
Aeronautics Systems     
United States$2,547 87 %$2,373 84 %
Asia/Pacific279 9 %207 8 %
Europe100 3 %166 6 %
All other(1)
20 1 %71 2 %
Intersegment sales44 26 
Aeronautics Systems sales2,990 2,843 
Defense Systems
United States1,026 75 %1,370 80 %
Asia/Pacific103 7 %82 5 %
Europe76 6 %70 4 %
All other(1)
172 12 %188 11 %
Intersegment sales185 171 
Defense Systems sales1,562 1,881 
Mission Systems
United States1,850 79 %1,688 78 %
Asia/Pacific160 7 %176 8 %
Europe269 11 %225 10 %
All other(1)
73 3 %82 4 %
Intersegment sales237 176 
Mission Systems sales2,589 2,347 
Space Systems
United States2,376 95 %1,854 97 %
Asia/Pacific16 1 %5 — %
Europe88 4 %59 3 %
All other(1)
2 — %4 — %
Intersegment sales39 26 
Space Systems sales2,521 1,948 
Total
United States7,799 85 %7,285 85 %
Asia/Pacific558 6 %470 5 %
Europe533 6 %520 6 %
All other(1)
267 3 %345 4 %
Total Sales$9,157 $8,620 
(1)All other is principally comprised of the Middle East.
(2)Percentages calculated based on external customer sales.