Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives Not Designated as Hedging Instruments

For the six months and three months ended June 30, 2019 and 2018, these items impacted the consolidated statement of earnings as follows:

(pre-tax, in millions)	For the Three Months Ended June 30,
Derivatives not Designated as Hedging Instruments	Statement of Earnings Classification of Gain/(Loss)	Amount of Gain/(Loss) Recognized in Earnings
		For the Six Months Ended June 30,				For the Three Months Ended June 30,
		2019		2018		2019		2018
Derivative contracts
	Interest expense, net	$	48	$	10	$	31	$	23
Total		$	48	$	10	$	31	$	23

Fair Value of Derivative Contracts

The fair value of PMI’s derivative contracts included in the condensed consolidated balance sheets as of June 30, 2019 and December 31, 2018, were as follows:

	Derivative Assets					Derivative Liabilities
		Fair Value					Fair Value
(in millions)	Balance Sheet Classification	At June 30, 2019		At December 31, 2018		Balance Sheet Classification	At June 30, 2019		At December 31, 2018
Derivative contracts designated as hedging instruments	Other current assets	$	275	$	54	Other accrued liabilities	$	66	$	47
	Other assets	38		99		Other liabilities	491		525
Derivative contracts not designated as hedging instruments	Other current assets	64		67		Other accrued liabilities	79		46
	Other assets	—		—		Other liabilities	27		13
Total derivatives		$	377	$	220		$	663	$	631

Cash Flow and Net Investment Hedging Activities Effect on Condensed Consolidated Statements of Earnings and Other Comprehensive Earnings

For the six months and three months ended June 30, 2019 and 2018, PMI's cash flow and net investment hedging instruments impacted the condensed consolidated statements of earnings and comprehensive earnings as follows:

(pre-tax, in millions)	For the Six Months Ended June 30,
	Amount of Gain/(Loss) Recognized in Other Comprehensive Earnings/(Losses) on Derivatives						Statement of Earnings Classification of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings	Amount of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings
	2019			2018				2019			2018
Derivatives in Cash Flow Hedging Relationship
Derivative contracts	$	(23	)	$	(12	)
							Net revenues	$	29		$	(7	)
							Cost of sales	—			—
							Marketing, administration and research costs	1			(3		)
							Interest expense, net	(2		)	(3		)
Derivatives in Net Investment Hedging Relationship
Derivative contracts	145			138
Total	$	122		$	126			$	28		$	(13	)

(pre-tax, in millions)	For the Three Months Ended June 30,
	Amount of Gain/(Loss) Recognized in Other Comprehensive Earnings/(Losses) on Derivatives					Statement of Earnings Classification of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings	Amount of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings
	2019			2018			2019		2018
Derivatives in Cash Flow Hedging Relationship
Derivative contracts	$	(21	)	$	62
						Net revenues	$	19	$	2
						Cost of sales	—		—
						Marketing, administration and research costs	4		(11		)
						Interest expense, net	—		(1		)
Derivatives in Net Investment Hedging Relationship
Derivative contracts	(66		)	746
Total	$	(87	)	$	808		$	23	$	(10	)

Qualifying Hedging Activity Reported in Accumulated Other Comprehensive Earnings (Losses), Net of Income Taxes

Hedging activity affected accumulated other comprehensive losses, net of income taxes, as follows:

(in millions)	For the Six Months Ended June 30,						For the Three Months Ended June 30,
	2019			2018			2019			2018
Gain/(loss) at beginning of period	$	35		$	42		$	30		$	(20	)
Derivative (gains)/losses transferred to earnings	(25		)	6			(21		)	4
Change in fair value	(20		)	(11		)	(19		)	53
Gain/(loss) as of June 30,	$	(10	)	$	37		$	(10	)	$	37