Revenue from Contracts with Customers

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers

Disaggregation of Revenue

The tables below present our revenue disaggregated by major product category and reportable segment.

	Three Months Ended June 30, 2020
	Supply Chain Services		Software Solutions		Prescription Management		Eliminations		Total
North America	$	495	$	19	$	110	$	(22)	$	602
Europe	342		2		—		(2)		342
APAC & Emerging Markets	83		2		—		—		85
Eliminations	(3)		—		—		—		(3)
Total Net sales	$	917	$	23	$	110	$	(24)	$	1,026
	Three Months Ended June 30, 2019
	Supply Chain Services		Software Solutions		Prescription Management		Eliminations		Total
North America	$	472	$	20	$	67	$	(7)	$	552
Europe	370		3		—		(3)		370
APAC & Emerging Markets	88		2		—		—		90
Eliminations	(3)		—		—		—		(3)
Total Net sales	$	927	$	25	$	67	$	(10)	$	1,009
	Six Months Ended June 30, 2020
	Supply Chain Services		Software Solutions		Prescription Management		Eliminations		Total
North America	$	956	$	40	$	195	$	(39)	$	1,152
Europe	766		4		—		(6)		764
APAC & Emerging Markets	176		4		—		—		180
Eliminations	(5)		—		—		—		(5)
Total Net sales	$	1,893	$	48	$	195	$	(45)	$	2,091
	Six Months Ended June 30, 2019
	Supply Chain Services		Software Solutions		Prescription Management		Eliminations		Total
North America	$	915	$	42	$	100	$	(8)	$	1,049
Europe	733		5		—		(7)		731
APAC & Emerging Markets	172		4		—		—		176
Eliminations	(6)		—		—		—		(6)
Total Net sales	$	1,814	$	51	$	100	$	(15)	$	1,950

Contract Balances

Contract balances represent amounts presented in the condensed consolidated balance sheets when we have either transferred goods or services to the customer or the customer has paid consideration to us under the contract. These contract balances include accounts receivable, contract assets, and contract liabilities.

Accounts Receivable

Accounts receivable are recognized at the amount invoiced and the carrying amount is reduced by an allowance for credit losses. Our estimation of current expected credit losses, with respect to receivables and recognition of allowances that, when deducted from the balance of the receivables, represent the net amounts expected to be collected. We do not consider there to be significant concentrations of credit risk with regard to trade receivables due to the short-term nature of our accounts, our large customer base, and strong historical experience collecting receivables. The allowance for credit losses is based on a number of factors which include reviewing delinquent accounts receivable, historical data, experience, customer types, creditworthiness, and economic trends. From time to time, we adjust our assumptions for anticipated changes in any of these or other factors expected to affect collectability, and the allowance for credit losses is reviewed quarterly for any required adjustments. Accounts receivable are written-off when it is probable that all contractual payments due will not be collected.

Contract Assets

Contract assets include amounts related to any conditional right to consideration for work completed as of the reporting date and generally represent amounts owed to us by customers, but not yet billed. Contract assets are transferred to Accounts receivable when the right becomes unconditional. Current contract assets are included in Prepaid expenses and other and non-current contract assets are included in Investments and other within the condensed consolidated balance sheets. The contract assets primarily relate to the bundled arrangements for the sale of equipment and consumables and sales of term software licenses. Current and non-current contract asset balances as of June 30, 2020 and December 31, 2019 were not material.

Contract Liabilities

Contract liabilities are comprised of advance payments and deferred revenue amounts. Contract liabilities are transferred to revenue once the performance obligation has been satisfied. Current contract liabilities are included in Other current liabilities and non-current contract liabilities are included in Other liabilities within the condensed consolidated balance sheets. The contract liabilities primarily relate to advance payments from customers and upfront payments for service arrangements provided over time. The current portion of contract liabilities of $29 million at June 30, 2020 and $37 million at December 31, 2019 were reported in Other current liabilities. Amounts related to non-current contract liabilities were not material.

Performance Obligations

Estimated future revenues expected to be generated from long-term contracts with unsatisfied performance obligations as of June 30, 2020 were not material.