Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

The fair value of PMI’s derivative contracts included in the consolidated balance sheets as of December 31, 2021 and 2020, were as follows:


	Derivative Assets					Derivative Liabilities
		Fair Value					Fair Value
(in millions)	Balance Sheet Classification	2021		2020		Balance Sheet Classification	2021		2020
Derivative contracts designated as hedging instruments	Other current assets	$	173	$	130	Other accrued liabilities	$	34	$	241
	Other assets	22		6		Income taxes and other liabilities	190		605
Derivative contracts not designated as hedging instruments	Other current assets	37		46		Other accrued liabilities	75		207
	Other assets	—		—		Income taxes and other liabilities	—		57
Total gross amount derivatives contracts presented in the consolidated balance sheets		$	232	$	182		$	299	$	1,110
Gross amounts not offset in the consolidated balance sheets
Financial instruments		(126)		(156)			(126)		(156)
Cash collateral received/pledged		(93)		(23)			(151)		(892)
Net amount		$	13	$	3		$	22	$	62

Hedging Activities Effect on Consolidated Statements of Earnings and Other Comprehensive Earnings

For the years ended December 31, 2021, 2020 and 2019, PMI's derivative contracts impacted the consolidated statements of earnings and comprehensive earnings as follows:


(pre-tax, in millions)	For the Years Ended December 31,
	Amount of Gain/(Loss) Recognized in Other Comprehensive Earnings/(Losses) on Derivatives						Statement of Earnings Classification of Gain/(Loss) on Derivatives	Amount of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings						Amount of Gain/(Loss) Recognized in Earnings
	2021		2020		2019			2021		2020		2019		2021		2020		2019
Derivative contracts designated as hedging instruments:
Cash flow hedges	$	144	$	(81)	$	(20)
							Net revenues	$	59	$	(3)	$	22
							Cost of sales	—		7		1
							Marketing, administration and research costs	(10)		27		2
							Interest expense, net	(7)		(11)		(8)
Fair value hedges							Interest expense, net							$	1	$	—	$	—
Net investment hedges (a)	484		(514)		369		Interest expense, net (b)							150		194		230
Derivative contracts not designated as hedging instruments							Interest expense, net							55		71		94
							Marketing, administration and research costs (c)							215		(368)		(115)
Total	$	628	$	(595)	$	349		$	42	$	20	$	17	$	421	$	(103)	$	209

(a) Amount of gains (losses) on hedges of net investments principally related to changes in exchange and interest rates between the Euro and U.S. dollar

(b) Represent the gains for amounts excluded from the effectiveness testing

(c) The gains (losses) from these contracts attributable to changes in foreign currency exchange rates substantially offset the (losses) and gains generated by the underlying intercompany and third-party loans being hedged

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:


	For the Years Ended December 31,
(in millions)	2021		2020		2019
Gain/(loss) as of January 1,	$	(85)	$	3	$	35
Derivative (gains)/losses transferred to earnings	(35)		(20)		(14)
Change in fair value	124		(68)		(18)
Gain/(loss) as of December 31,	$	4	$	(85)	$	3