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Revenue
 6 Months Ended
Jun. 30, 2023
Revenue Recognition and Deferred Revenue [Abstract]  
Revenue
4. Revenue
A. Revenue from Product Sales
We offer a diversified portfolio of products which allows us to capitalize on local and regional customer needs. Generally, our products are promoted to veterinarians and livestock producers by our sales organization which includes sales representatives and technical and veterinary operations specialists, and then sold directly by us or through distributors, retailers or e-commerce outlets. The depth of our product portfolio enables us to address the varying needs of customers in different species and geographies. Many of our top-selling product lines are distributed across both of our operating segments, leveraging our research and development (R&D) operations and manufacturing and supply chain network.
Over the course of our history, we have focused on developing a diverse portfolio of animal health products, including medicines, vaccines and diagnostics, complemented by biodevices, genetic tests and a range of services. We refer to all different brands of a particular product, or its dosage forms for all species, as a product line. We have approximately 300 comprehensive product lines, including products for both companion animals and livestock within each of our major product categories.
Our major product categories are:
•parasiticides: products that prevent or eliminate external and internal parasites such as fleas, ticks and worms;
•vaccines: biological preparations that help prevent diseases of the respiratory, gastrointestinal and reproductive tracts or induce a specific immune response;
•dermatology products: products that relieve itch associated with allergic conditions and atopic dermatitis;
•other pharmaceutical products: pain and sedation, antiemetic, reproductive, and oncology products;
•anti-infectives: products that prevent, kill or slow the growth of bacteria, fungi or protozoa;
•animal health diagnostics: testing and analysis of blood, urine and other animal samples and related products and services, including point-of-care diagnostic products, instruments and reagents, rapid immunoassay tests, reference laboratory kits and services and blood glucose monitors; and
•medicated feed additives: products added to animal feed that provide medicines to livestock.
Our remaining revenue is derived from other non-pharmaceutical product categories, such as nutritionals, as well as products and services in biodevices, genetic tests and precision animal health.
Our companion animal products help extend and improve the quality of life for pets; increase convenience and compliance for pet owners; and help veterinarians improve the quality of their care and the efficiency of their businesses. Growth in the companion animal medicines, vaccines and diagnostics sector is driven by economic development, related increases in disposable income and increases in pet ownership and spending on pet care. Companion animals are also living longer, deepening the human-animal bond, receiving increased medical treatment and benefiting from advances in animal health medicine, vaccines and diagnostics.
Our livestock products primarily help prevent or treat diseases and conditions to allow veterinarians and producers to care for their animals and to enable the cost-effective production of safe, high-quality animal protein. Human population growth and increasing standards of living are important long-term growth drivers for our livestock products in three major ways. First, population growth and increasing standards of living drive demand for improved nutrition, particularly through increased consumption of animal protein. Second, population growth leads to greater natural resource constraints driving a need for enhanced productivity. Finally, as standards of living improve and the global food chain faces increased scrutiny, there is more focus on food quality, safety and reliability of supply.
The following tables present our revenue disaggregated by geographic area, species and major product category:
Revenue by geographic area
Three Months EndedSix Months Ended
June 30,June 30,
(MILLIONS OF DOLLARS)2023202220232022
United States$1,165 $1,091 $2,170 $2,111 
Australia82 80 164 145 
Brazil91 86 175 163 
Canada70 67 120 116 
Chile39 34 78 75 
China84 96 186 199 
France34 31 68 63 
Germany53 46 98 89 
Italy35 32 61 62 
Japan47 41 86 100 
Mexico38 33 77 68 
Spain31 35 64 68 
United Kingdom63 51 131 115 
Other developed markets125 118 247 233 
Other emerging markets203 193 418 395 
2,160 2,034 4,143 4,002 
Contract manufacturing & human health20 18 37 36 
Total Revenue$2,180 $2,052 $4,180 $4,038 
Revenue by major species
Three Months EndedSix Months Ended
June 30,June 30,
(MILLIONS OF DOLLARS)2023202220232022
U.S.
Companion animal$959 $895 $1,680 $1,669 
Livestock206 196 490 442 
1,165 1,091 2,170 2,111 
International
Companion animal530 471 1,034 960 
Livestock465 472 939 931 
995 943 1,973 1,891 
Total
Companion animal1,489 1,366 2,714 2,629 
Livestock671 668 1,429 1,373 
Contract manufacturing & human health20 18 37 36 
Total Revenue$2,180 $2,052 $4,180 $4,038 
Revenue by species
Three Months EndedSix Months Ended
June 30,June 30,
(MILLIONS OF DOLLARS)2023202220232022
Companion Animal:
Dogs and Cats$1,424 $1,303 $2,577 $2,502 
Horses65 63 137 127 
1,489 1,366 2,714 2,629 
Livestock:
Cattle329 328 728 692 
Swine133 144 275 298 
Poultry131 121 270 245 
Fish52 47 101 91 
Sheep and other26 28 55 47 
671 668 1,429 1,373 
Contract manufacturing & human health20 18 37 36 
Total Revenue$2,180 $2,052 $4,180 $4,038 
Revenue by major product category
Three Months EndedSix Months Ended
June 30,June 30,
(MILLIONS OF DOLLARS)2023202220232022
Parasiticides$568 $536 $1,000 $995 
Vaccines430 446 859 851 
Dermatology359 319 651 630 
Other pharmaceuticals315 265 609 519 
Anti-infectives244 233 532 518 
Animal health diagnostics96 87 189 185 
Medicated feed additives84 85 171 183 
Other non-pharmaceuticals64 63 132 121 
2,160 2,034 4,143 4,002 
Contract manufacturing & human health20 18 37 36 
Total Revenue$2,180 $2,052 $4,180 $4,038 
B. Revenue from Contracts with Customers
Contract liabilities reflected within Other current liabilities as of December 31, 2022 and 2021, and subsequently recognized as revenue during the first six months of 2023 and 2022 were $3 million and $2 million, respectively. Contract liabilities as of June 30, 2023 and December 31, 2022 were $15 million and $14 million, respectively.
Estimated future revenue expected to be generated from long-term contracts with unsatisfied performance obligations as of June 30, 2023 is not material.