QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
ý | Accelerated Filer | ¨ | |||||||||
Non-accelerated Filer | ¨ | Smaller Reporting Company | |||||||||
Emerging Growth Company |
Page | |||||
Quarter Ended June 30, | ||||||||||||||
(amounts in millions, except per share amounts) | 2022 | 2021 | ||||||||||||
Net sales: | ||||||||||||||
Product sales | $ | $ | ||||||||||||
Service sales | ||||||||||||||
Costs and expenses: | ||||||||||||||
Cost of products sold | ||||||||||||||
Cost of services sold | ||||||||||||||
Research and development | ||||||||||||||
Selling, general and administrative | ||||||||||||||
Other income (expense), net | ( | |||||||||||||
Operating profit | ||||||||||||||
Non-service pension cost (benefit) | ||||||||||||||
Interest expense (income), net | ||||||||||||||
Net income before income taxes | ||||||||||||||
Income tax expense | ||||||||||||||
Net income | ||||||||||||||
Less: Noncontrolling interest in subsidiaries' earnings | ||||||||||||||
Net income attributable to Otis Worldwide Corporation | $ | $ | ||||||||||||
Earnings per share (Note 2): | ||||||||||||||
Basic | $ | $ | ||||||||||||
Diluted | $ | $ | ||||||||||||
Weighted average number of shares outstanding | ||||||||||||||
Basic shares | ||||||||||||||
Diluted shares | ||||||||||||||
Six Months Ended June 30, | ||||||||||||||
(amounts in millions, except per share amounts) | 2022 | 2021 | ||||||||||||
Net sales: | ||||||||||||||
Product sales | $ | $ | ||||||||||||
Service sales | ||||||||||||||
Costs and expenses: | ||||||||||||||
Cost of products sold | ||||||||||||||
Cost of services sold | ||||||||||||||
Research and development | ||||||||||||||
Selling, general and administrative | ||||||||||||||
Other income (expense), net | ( | |||||||||||||
Operating profit | ||||||||||||||
Non-service pension cost (benefit) | ||||||||||||||
Interest expense (income), net | ||||||||||||||
Net income before income taxes | ||||||||||||||
Income tax expense | ||||||||||||||
Net income | ||||||||||||||
Less: Noncontrolling interest in subsidiaries' earnings | ||||||||||||||
Net income attributable to Otis Worldwide Corporation | $ | $ | ||||||||||||
Earnings per share (Note 2): | ||||||||||||||
Basic | $ | $ | ||||||||||||
Diluted | $ | $ | ||||||||||||
Weighted average number of shares outstanding | ||||||||||||||
Basic shares | ||||||||||||||
Diluted shares |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Net income | $ | $ | $ | $ | ||||||||||||||||||||||
Other comprehensive income (loss), net of tax: | ||||||||||||||||||||||||||
Foreign currency translation adjustments | ( | ( | ( | |||||||||||||||||||||||
Pension and postretirement benefit plan adjustments | ||||||||||||||||||||||||||
Change in unrealized cash flow hedging | ( | |||||||||||||||||||||||||
Other comprehensive income (loss), net of tax | ( | ( | ||||||||||||||||||||||||
Comprehensive income (loss), net of tax | ||||||||||||||||||||||||||
Less: Comprehensive (income) loss attributable to noncontrolling interest | ( | ( | ||||||||||||||||||||||||
Comprehensive income attributable to Otis Worldwide Corporation | $ | $ | $ | $ |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Assets | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash | ||||||||||||||
Accounts receivable (net of allowance for expected credit losses of $ | ||||||||||||||
Contract assets | ||||||||||||||
Inventories | ||||||||||||||
Other current assets | ||||||||||||||
Total Current Assets | ||||||||||||||
Future income tax benefits | ||||||||||||||
Fixed assets (net of accumulated depreciation of $ | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Intangible assets, net | ||||||||||||||
Goodwill | ||||||||||||||
Other assets | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
Liabilities and Equity (Deficit) | ||||||||||||||
Short-term borrowings | $ | $ | ||||||||||||
Accounts payable | ||||||||||||||
Accrued liabilities | ||||||||||||||
Contract liabilities | ||||||||||||||
Total Current Liabilities | ||||||||||||||
Long-term debt | ||||||||||||||
Future pension and postretirement benefit obligations | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Future income tax obligations | ||||||||||||||
Other long-term liabilities | ||||||||||||||
Total Liabilities | ||||||||||||||
Commitments and contingent liabilities (Note 16) | ||||||||||||||
Redeemable noncontrolling interest | ||||||||||||||
Shareholders' Equity (Deficit): | ||||||||||||||
Common Stock and additional paid-in capital | ||||||||||||||
Treasury Stock | ( | ( | ||||||||||||
Accumulated deficit | ( | ( | ||||||||||||
Accumulated other comprehensive income (loss) | ( | ( | ||||||||||||
Total Shareholders' Equity (Deficit) | ( | ( | ||||||||||||
Noncontrolling interest | ||||||||||||||
Total Equity (Deficit) | ( | ( | ||||||||||||
Total Liabilities and Equity (Deficit) | $ | $ |
Common Stock and Additional Paid-In Capital | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' (Deficit) Equity | Noncontrolling Interest | Total (Deficit) Equity | Redeemable Noncontrolling Interest | |||||||||||||||||||||||||||||||||||||||||||
(dollars in millions, except per share amounts) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Quarter Ended June 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2022 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax, and foreign currency reclassifications (Note 10) | — | — | — | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation and Common Stock issued under employee plans | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | ( | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Repurchase of Common Shares | — | ( | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends attributable to noncontrolling interest | — | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Acquisitions, disposals and other changes | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2022 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||
Quarter Ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2021 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation and Common Stock issued under employee plans | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | ( | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Repurchase of Common Shares | — | ( | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends attributable to noncontrolling interest | — | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Acquisition, disposal and other changes | — | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2021 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ |
Common Stock and Additional Paid-In Capital | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' (Deficit) Equity | Noncontrolling Interest | Total (Deficit) Equity | Redeemable Noncontrolling Interest | |||||||||||||||||||||||||||||||||||||||||||
(dollars in millions, except per share amounts) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance December 31, 2021 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax, and foreign currency reclassifications (Note 10) | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation and Common Stock issued under employee plans | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | ( | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Repurchase of Common Shares | — | ( | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends attributable to noncontrolling interest | — | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Reclassification of noncontrolling interest to forward purchase agreement and redeemable noncontrolling interest (Note 1) | — | — | ( | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Acquisitions, disposals and other changes in noncontrolling interest | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance December 31, 2020 | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation and Common Stock issued under employee plans | — | ( | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | — | — | ( | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Repurchase of Common Shares | — | ( | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends attributable to noncontrolling interest | — | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Acquisitions, disposals and other changes | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2021 | $ | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ |
Six Months Ended June 30, | ||||||||||||||
(dollars in millions) | 2022 | 2021 | ||||||||||||
Operating Activities: | ||||||||||||||
Net income | $ | $ | ||||||||||||
Adjustments to reconcile net income to net cash flows provided by operating activities, net of acquisitions: | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Deferred income tax expense (benefit) | ( | |||||||||||||
Stock compensation cost | ||||||||||||||
Change in operating assets and liabilities: | ||||||||||||||
Accounts receivable, net | ( | ( | ||||||||||||
Contract assets and liabilities, current | ||||||||||||||
Inventories | ( | ( | ||||||||||||
Other current assets | ||||||||||||||
Accounts payable | ||||||||||||||
Accrued liabilities | ( | ( | ||||||||||||
Pension contributions | ( | ( | ||||||||||||
Other operating activities, net | ||||||||||||||
Net cash flows provided by operating activities | ||||||||||||||
Investing Activities: | ||||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Investments in businesses and intangible assets, net of cash acquired (Note 6) | ( | ( | ||||||||||||
Proceeds from the sale of (investments in) marketable securities | ( | |||||||||||||
Receipts (payments) on settlements of derivative contracts | ||||||||||||||
Other investing activities, net | ||||||||||||||
Net cash flows used in investing activities | ( | ( | ||||||||||||
Financing Activities: | ||||||||||||||
Net proceeds from (repayments of) borrowings (maturities of 90 days or less) | ( | |||||||||||||
Proceeds from borrowings (maturities longer than 90 days) | ||||||||||||||
Repayments of borrowings (maturities longer than 90 days) | ( | |||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||
Payment of debt issuance costs | ( | |||||||||||||
Repayment of long-term debt | ( | |||||||||||||
Dividends paid on Common Stock | ( | ( | ||||||||||||
Repurchases of Common Stock | ( | ( | ||||||||||||
Dividends paid to noncontrolling interest | ( | ( | ||||||||||||
Acquisition of Zardoya Otis shares (Note 1) | ( | |||||||||||||
Other financing activities, net | ( | ( | ||||||||||||
Net cash flows provided by (used in) financing activities | ( | ( | ||||||||||||
Effect of foreign exchange rate changes on cash and cash equivalents | ( | |||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | |||||||||||||
Cash, cash equivalents and restricted cash, beginning of year | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||
Less: Restricted cash | ||||||||||||||
Less: Cash and cash equivalents held for sale included in Other current assets (Note 6) | ||||||||||||||
Cash and cash equivalents, end of period | $ | $ | ||||||||||||
As of March 31, 2022 | ||||||||||||||||||||
(dollars in millions) | As Previously Reported | Correction of Error | As Revised | |||||||||||||||||
Liabilities and Equity (Deficit) | ||||||||||||||||||||
Forward purchase agreement | $ | $ | $ | |||||||||||||||||
Total Current Liabilities | ||||||||||||||||||||
Total Liabilities | ||||||||||||||||||||
Redeemable noncontrolling interest | ( | |||||||||||||||||||
Total Liabilities and Equity (Deficit) | $ | $ | $ |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(amounts in millions, except per share amounts) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Net income attributable to Otis Worldwide Corporation | $ | $ | $ | $ | ||||||||||||||||||||||
Impact of redeemable noncontrolling interest | ||||||||||||||||||||||||||
Net income attributable to common shareholders | $ | $ | $ | $ | ||||||||||||||||||||||
Basic weighted average number of shares outstanding | ||||||||||||||||||||||||||
Stock awards and equity units (share equivalent) | ||||||||||||||||||||||||||
Diluted weighted average number of shares outstanding | ||||||||||||||||||||||||||
Earnings Per Share of Common Stock: | ||||||||||||||||||||||||||
Basic | $ | $ | ||||||||||||||||||||||||
Diluted | $ | $ |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Contract assets, current | $ | $ | ||||||||||||
Total contract assets | ||||||||||||||
Contract liabilities, current | ||||||||||||||
Contract liabilities, non-current (included within Other long-term liabilities) | ||||||||||||||
Total contract liabilities | ||||||||||||||
Net contract liabilities | $ | $ |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Trade receivables | $ | $ | ||||||||||||
Unbilled receivables | ||||||||||||||
Miscellaneous receivables | ||||||||||||||
Customer financing notes receivable | ||||||||||||||
Less: allowance for expected credit losses | ||||||||||||||
Accounts receivable, net | $ | $ |
Six Months Ended June 30, | ||||||||||||||
(dollars in millions) | 2022 | 2021 | ||||||||||||
Balance as of January 1 | $ | $ | ||||||||||||
Provision for expected credit losses | ||||||||||||||
Write-offs charged against the allowance for expected credit losses | ( | ( | ||||||||||||
Foreign exchange and other | ( | |||||||||||||
Balance as of June 30 | $ | $ | ||||||||||||
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Raw materials and work-in-process | $ | $ | ||||||||||||
Finished goods | ||||||||||||||
Total | $ | $ |
(dollars in millions) | Balance as of January 1, 2022 | Goodwill Resulting From Business Combinations | Foreign Currency Translation and Other 1 | Balance as of June 30, 2022 | ||||||||||||||||||||||
New Equipment | $ | $ | $ | ( | $ | |||||||||||||||||||||
Service | ( | |||||||||||||||||||||||||
Total | $ | $ | $ | ( | $ |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Commercial paper | $ | $ | ||||||||||||
Other borrowings | ||||||||||||||
Total short-term borrowings | $ | $ |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
LIBOR plus | $ | $ | ||||||||||||
Other (including finance leases) | ||||||||||||||
Total principal long-term debt | ||||||||||||||
Other (discounts and debt issuance costs) | ( | ( | ||||||||||||
Total long-term debt | ||||||||||||||
Less: current portion | ||||||||||||||
Long-term debt, net of current portion | $ | $ |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Debt issuance costs amortization | $ | $ | $ | $ | ||||||||||||||||||||||
Total interest expense on external debt |
June 30, 2022 | December 31, 2021 | |||||||||||||
Short-term borrowings | % | % | ||||||||||||
Total long-term debt | % | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Short-term borrowings | % | ( | % | % | ( | % | ||||||||||||||||||||
Total long-term debt | % | % | % | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Defined benefit plans | $ | $ | $ | $ | ||||||||||||||||||||||
Defined contribution plans | ||||||||||||||||||||||||||
Multi-employer pension and postretirement plans |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Service cost | $ | $ | $ | $ | ||||||||||||||||||||||
Interest cost | ||||||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | ||||||||||||||||||||||
Recognized actuarial net loss | ||||||||||||||||||||||||||
Total net periodic benefit cost | $ | $ | $ | $ |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Stock-based compensation expense (Share Based) | $ | $ | $ | $ | ||||||||||||||||||||||
Stock-based compensation expense (income) (Liability Awards) | ( | |||||||||||||||||||||||||
Total gross stock-based compensation expense | ||||||||||||||||||||||||||
Less: future tax benefit | ||||||||||||||||||||||||||
Stock-based compensation expense, net of tax | $ | $ | $ | $ |
(dollars in millions) | Foreign Currency Translation | Defined Benefit Pension and Postretirement Plans | Unrealized Hedging Gains (Losses) | Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||
Quarter Ended June 30, 2022 | ||||||||||||||||||||||||||
Balance as of March 31, 2022 | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Other comprehensive income (loss) before reclassifications, net | ( | |||||||||||||||||||||||||
Amounts reclassified upon change in Otis' share of Zardoya Otis ownership (Note 1) | ( | ( | ||||||||||||||||||||||||
Amounts reclassified, pre-tax | ||||||||||||||||||||||||||
Balance as of June 30, 2022 | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Six Months Ended June 30, 2022 | ||||||||||||||||||||||||||
Balance as of December 31, 2021 | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Other comprehensive income (loss) before reclassifications, net | ||||||||||||||||||||||||||
Amounts reclassified upon change in Otis' share of Zardoya Otis ownership (Note 1) | ( | ( | ||||||||||||||||||||||||
Amounts reclassified, pre-tax | ( | |||||||||||||||||||||||||
Tax benefit reclassified | ( | ( | ||||||||||||||||||||||||
Balance as of June 30, 2022 | $ | ( | $ | ( | $ | $ | ( |
(dollars in millions) | Foreign Currency Translation | Defined Benefit Pension and Postretirement Plans | Unrealized Hedging Gains (Losses) | Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||
Quarter Ended June 30, 2021 | ||||||||||||||||||||||||||
Balance as of March 31, 2021 | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Other comprehensive income (loss) before reclassifications, net | ||||||||||||||||||||||||||
Amounts reclassified, pre-tax | ( | |||||||||||||||||||||||||
Tax benefit reclassified | ( | ( | ||||||||||||||||||||||||
Balance as of June 30, 2021 | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Six Months Ended June 30, 2021 | ||||||||||||||||||||||||||
Balance as of December 31, 2020 | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Other comprehensive income (loss) before reclassifications, net | ( | |||||||||||||||||||||||||
Amounts reclassified, pre-tax | ||||||||||||||||||||||||||
Tax benefit reclassified | ( | ( | ||||||||||||||||||||||||
Balance as of June 30, 2021 | $ | ( | $ | ( | $ | $ | ( |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Cost of products and services sold | $ | $ | $ | $ | ||||||||||||||||||||||
Selling, general and administrative | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
(dollars in millions) | Expected Costs | Costs Incurred During 2021 | Costs Incurred Quarter Ended March 31, 2022 | Costs Incurred Quarter Ended June 30, 2022 | Remaining Costs as of June 30, 2022 | |||||||||||||||||||||||||||
Total 2022 Actions | $ | $ | — | $ | ( | $ | ( | $ | ||||||||||||||||||||||||
Total 2021 Actions | $ | $ | ( | $ | ( | $ | $ |
(dollars in millions) | 2022 Actions | 2021 Actions | ||||||||||||
Quarter Ended June 30, 2022 | ||||||||||||||
Restructuring accruals as of March 31, 2022 | $ | $ | ||||||||||||
Net restructuring costs | ||||||||||||||
Utilization, foreign exchange and other costs | ( | ( | ||||||||||||
Balance as of June 30, 2022 | $ | $ | ||||||||||||
Six Months Ended June 30, 2022 | ||||||||||||||
Restructuring accruals as of December 31, 2021 | $ | $ | ||||||||||||
Net restructuring costs | ||||||||||||||
Utilization, foreign exchange and other costs | ( | ( | ||||||||||||
Balance as of June 30, 2022 | $ | $ |
(dollars in millions) | Balance Sheet Classification | June 30, 2022 | December 31, 2021 | |||||||||||||||||
Derivatives designated as Cash flow hedging instruments: | ||||||||||||||||||||
Asset Derivatives: | ||||||||||||||||||||
Foreign exchange contracts | Other current assets | $ | $ | |||||||||||||||||
Foreign exchange contracts | Other assets | |||||||||||||||||||
Total asset derivatives | $ | $ | ||||||||||||||||||
Liability Derivatives: | ||||||||||||||||||||
Foreign exchange contracts | Accrued liabilities | $ | ( | $ | ( | |||||||||||||||
Total liability derivatives | $ | ( | $ | ( | ||||||||||||||||
Derivatives not designated as Cash flow hedging instruments: | ||||||||||||||||||||
Asset Derivatives: | ||||||||||||||||||||
Foreign exchange contracts | Other current assets | $ | $ | |||||||||||||||||
Foreign exchange contracts | Other assets | |||||||||||||||||||
Total asset derivatives | $ | $ | ||||||||||||||||||
Liability Derivatives: | ||||||||||||||||||||
Foreign exchange contracts | Accrued liabilities | $ | ( | $ | ( | |||||||||||||||
Commodity contracts | Accrued liabilities | ( | ||||||||||||||||||
Foreign exchange contracts | Other long-term liabilities | ( | ( | |||||||||||||||||
Total liability derivatives | $ | ( | $ | ( |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Gain (loss) recorded in Accumulated other comprehensive income (loss) | $ | $ | ||||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Foreign exchange contracts | $ | ( | $ | ( |
June 30, 2022 | ||||||||||||||||||||||||||
(dollars in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||
Recurring fair value measurements: | ||||||||||||||||||||||||||
Equity securities | $ | $ | $ | $ | ||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||
Derivative liabilities | ( | ( | ||||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||
(dollars in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||
Recurring fair value measurements: | ||||||||||||||||||||||||||
Equity securities | $ | $ | $ | $ | ||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||
Derivative liabilities | ( | ( | ||||||||||||||||||||||||
June 30, 2022 | December 31, 2021 | |||||||||||||||||||||||||
(dollars in millions) | Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||||||||||
Long-term receivables, net | $ | $ | $ | $ | ||||||||||||||||||||||
Customer financing notes receivable, net | ||||||||||||||||||||||||||
Short-term borrowings | ( | ( | ( | ( | ||||||||||||||||||||||
Long-term debt (excluding leases and other) | ( | ( | ( | ( | ||||||||||||||||||||||
Long-term liabilities (including current portion) | ( | ( | ( | ( |
June 30, 2022 | ||||||||||||||||||||||||||
(dollars in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||
Long-term receivables, net | $ | $ | $ | $ | ||||||||||||||||||||||
Customer financing notes receivable, net | ||||||||||||||||||||||||||
Short-term borrowings | ( | ( | ||||||||||||||||||||||||
Long-term debt (excluding leases and other) | ( | ( | ||||||||||||||||||||||||
Long-term liabilities (including current portion) | ( | ( |
December 31, 2021 | ||||||||||||||||||||||||||
(dollars in millions) | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||
Long-term receivables, net | $ | $ | $ | $ | ||||||||||||||||||||||
Customer financing notes receivable, net | ||||||||||||||||||||||||||
Short-term borrowings | ( | ( | ||||||||||||||||||||||||
Long-term debt (excluding leases and other) | ( | ( | ||||||||||||||||||||||||
Long-term liabilities (including current portion) | ( | ( |
(dollars in millions) | 2022 | 2021 | ||||||||||||
Balance as of December 31 | $ | $ | ||||||||||||
Warranties | ||||||||||||||
Settlements made | ( | ( | ||||||||||||
Foreign exchange and other | ||||||||||||||
Balance as of June 30 | $ | $ |
Net Sales | Operating Profit | Operating Profit Margin | ||||||||||||||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||||||
New Equipment | $ | $ | $ | $ | % | % | ||||||||||||||||||||||||||||||||
Service | % | % | ||||||||||||||||||||||||||||||||||||
Total segments | % | % | ||||||||||||||||||||||||||||||||||||
General corporate expenses and other | ( | ( | ||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | % | % | ||||||||||||||||||||||||||||||||
Net Sales | Operating Profit | Operating Profit Margin | ||||||||||||||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||||||
New Equipment | $ | $ | $ | $ | % | % | ||||||||||||||||||||||||||||||||
Service | % | % | ||||||||||||||||||||||||||||||||||||
Total segments | % | % | ||||||||||||||||||||||||||||||||||||
General corporate expenses and other | ( | ( | ||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | % | % | ||||||||||||||||||||||||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
United States Operations | $ | $ | $ | $ | ||||||||||||||||||||||
International Operations | ||||||||||||||||||||||||||
China | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
New Equipment | $ | $ | $ | $ | ||||||||||||||||||||||
Maintenance and Repair | ||||||||||||||||||||||||||
Modernization | ||||||||||||||||||||||||||
Total Service | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Net sales | $ | 3,488 | $ | 3,701 | $ | 6,902 | $ | 7,109 | ||||||||||||||||||
Percentage change year-over-year | (5.8) | % | (2.9) | % |
Components of Net sales change: | Quarter Ended June 30, 2022 | Six Months Ended June 30, 2022 | ||||||||||||
Organic volume | 0.4 | % | 1.6 | % | ||||||||||
Foreign currency translation | (5.3) | % | (4.1) | % | ||||||||||
Russia | (1.0) | % | (0.5) | % | ||||||||||
Acquisitions and divestitures, net | 0.1 | % | 0.1 | % | ||||||||||
Total % change | (5.8) | % | (2.9) | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Total cost of products and services sold | $ | 2,505 | $ | 2,626 | $ | 4,913 | $ | 5,015 | ||||||||||||||||||
Percentage change year-over-year | (4.6) | % | (2.0) | % |
Components of Cost of Products and Services Sold change: | Quarter Ended June 30, 2022 | Six Months Ended June 30, 2022 | ||||||||||||
Organic volume | 1.8 | % | 2.4 | % | ||||||||||
Foreign currency translation | (5.3) | % | (4.0) | % | ||||||||||
Russia | (0.9) | % | (0.3) | % | ||||||||||
Other | (0.2) | % | (0.1) | % | ||||||||||
Total % change | (4.6) | % | (2.0) | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Gross margin | $ | 983 | $ | 1,075 | $ | 1,989 | $ | 2,094 | ||||||||||||||||||
Gross margin percentage | 28.2 | % | 29.0 | % | 28.8 | % | 29.5 | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Research and development | $ | 38 | $ | 39 | $ | 75 | $ | 74 | ||||||||||||||||||
Percentage of Net sales | 1.1 | % | 1.1 | % | 1.1 | % | 1.0 | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Selling, general and administrative | $ | 439 | $ | 484 | $ | 898 | $ | 966 | ||||||||||||||||||
Percentage of Net sales | 12.6 | % | 13.1 | % | 13.0 | % | 13.6 | % |
Six Months Ended June 30, | ||||||||||||||
(dollars in millions) | 2022 | 2021 | ||||||||||||
Restructuring costs | $ | 39 | $ | 26 |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Other income (expense), net | $ | (19) | $ | 9 | $ | (3) | $ | 16 |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Interest expense (income), net | $ | 35 | $ | 27 | $ | 72 | $ | 59 |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Effective tax rate | 22.8 | % | 28.8 | % | 25.4 | % | 27.4 | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
Noncontrolling interest in subsidiaries' earnings | $ | 27 | $ | 53 | $ | 69 | $ | 97 | ||||||||||||||||||
Net income attributable to Otis Worldwide Corporation | $ | 321 | $ | 326 | $ | 632 | $ | 634 | ||||||||||||||||||
Net Sales | Operating Profit | Operating Profit Margin | ||||||||||||||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||||||
New Equipment | $ | 1,534 | $ | 1,727 | $ | 99 | $ | 147 | 6.5 | % | 8.5 | % | ||||||||||||||||||||||||||
Service | 1,954 | 1,974 | 435 | 441 | 22.3 | % | 22.3 | % | ||||||||||||||||||||||||||||||
Total segment | 3,488 | 3,701 | 534 | 588 | 15.3 | % | 15.9 | % | ||||||||||||||||||||||||||||||
General corporate expenses and other | — | — | (47) | (27) | — | — | ||||||||||||||||||||||||||||||||
Total | $ | 3,488 | $ | 3,701 | $ | 487 | $ | 561 | 14.0 | % | 15.2 | % | ||||||||||||||||||||||||||
Net Sales | Operating Profit | Operating Profit Margin | ||||||||||||||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||||||||||||
New Equipment | $ | 2,956 | $ | 3,185 | $ | 192 | $ | 251 | 6.5 | % | 7.9 | % | ||||||||||||||||||||||||||
Service | 3,946 | 3,924 | 882 | 871 | 22.4 | % | 22.2 | % | ||||||||||||||||||||||||||||||
Total segment | 6,902 | 7,109 | 1,074 | 1,122 | 15.6 | % | 15.8 | % | ||||||||||||||||||||||||||||||
General corporate expenses and other | — | — | (61) | (52) | — | — | ||||||||||||||||||||||||||||||||
Total | $ | 6,902 | $ | 7,109 | $ | 1,013 | $ | 1,070 | 14.7 | % | 15.1 | % | ||||||||||||||||||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | Change | Change | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 1,534 | $ | 1,727 | $ | (193) | (11.2) | % | $ | 2,956 | $ | 3,185 | $ | (229) | (7.2) | % | ||||||||||||||||||||||||||||||||||
Cost of sales | 1,291 | 1,418 | (127) | (9.0) | % | 2,481 | 2,605 | (124) | (4.8) | % | ||||||||||||||||||||||||||||||||||||||||
243 | 309 | (66) | (21.4) | % | 475 | 580 | (105) | (18.1) | % | |||||||||||||||||||||||||||||||||||||||||
Operating expenses | 144 | 162 | (18) | (11.1) | % | 283 | 329 | (46) | (14.0) | % | ||||||||||||||||||||||||||||||||||||||||
Operating profit | $ | 99 | $ | 147 | $ | (48) | (32.7) | % | $ | 192 | $ | 251 | $ | (59) | (23.5) | % | ||||||||||||||||||||||||||||||||||
Operating profit margin | 6.5 | % | 8.5 | % | 6.5 | % | 7.9 | % |
Components of Net sales change: | Quarter Ended June 30, 2022 | Six Months Ended June 30, 2022 | ||||||||||||
Organic volume | (5.0) | % | (3.2) | % | ||||||||||
Foreign currency translation | (3.8) | % | (2.7) | % | ||||||||||
Russia | (1.9) | % | (1.0) | % | ||||||||||
Acquisitions/Divestitures, net and Other | (0.5) | % | (0.3) | % | ||||||||||
Total % change | (11.2) | % | (7.2) | % |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | Change | Change | 2022 | 2021 | Change | Change | ||||||||||||||||||||||||||||||||||||||||||
Net sales | $ | 1,954 | $ | 1,974 | $ | (20) | (1.0) | % | $ | 3,946 | $ | 3,924 | $ | 22 | 0.6 | % | ||||||||||||||||||||||||||||||||||
Cost of sales | 1,214 | 1,208 | 6 | 0.5 | % | 2,432 | 2,410 | 22 | 0.9 | % | ||||||||||||||||||||||||||||||||||||||||
740 | 766 | (26) | (3.4) | % | 1,514 | 1,514 | — | — | % | |||||||||||||||||||||||||||||||||||||||||
Operating expenses | 305 | 325 | (20) | (6.2) | % | 632 | 643 | (11) | (1.7) | % | ||||||||||||||||||||||||||||||||||||||||
Operating profit | $ | 435 | $ | 441 | $ | (6) | (1.4) | % | $ | 882 | $ | 871 | $ | 11 | 1.3 | % | ||||||||||||||||||||||||||||||||||
Operating profit margin | 22.3 | % | 22.3 | % | 22.4 | % | 22.2 | % |
Components of Net sales change: | Quarter Ended June 30, 2022 | Six Months Ended June 30, 2022 | ||||||||||||
Organic volume | 5.2 | % | 5.5 | % | ||||||||||
Foreign currency translation | (6.5) | % | (5.1) | % | ||||||||||
Russia | 0.1 | % | — | % | ||||||||||
Acquisitions/Divestitures, net | 0.2 | % | 0.2 | % | ||||||||||
Total % change | (1.0) | % | 0.6 | % |
Components of Net sales change: | Maintenance and Repair | Modernization | ||||||||||||
Organic volume | 4.9 | % | 6.4 | % | ||||||||||
Foreign currency translation | (6.5) | % | (6.1) | % | ||||||||||
Russia | 0.1 | % | — | % | ||||||||||
Acquisitions/Divestitures, net | 0.2 | % | — | % | ||||||||||
Total % change | (1.3) | % | 0.3 | % |
Components of Net sales change: | Maintenance and Repair | Modernization | ||||||||||||
Organic volume | 5.2 | % | 6.7 | % | ||||||||||
Foreign currency translation | (5.1) | % | (4.9) | % | ||||||||||
Acquisitions/Divestitures, net | 0.2 | % | — | % | ||||||||||
Total % change | 0.3 | % | 1.8 | % | ||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
General corporate expenses and other | $ | (47) | $ | (27) | $ | (61) | $ | (52) |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Cash and cash equivalents | $ | 1,218 | $ | 1,565 | ||||||||||
Total debt | 6,683 | 7,273 | ||||||||||||
Net debt (total debt less cash and cash equivalents) | 5,465 | 5,708 | ||||||||||||
Total equity 1 | (4,888) | (3,144) | ||||||||||||
Total capitalization (total debt plus total equity) | 1,795 | 4,129 | ||||||||||||
Net capitalization (total debt plus total equity less cash and cash equivalents) | 577 | 2,564 | ||||||||||||
Total debt to total capitalization 1 | 372 | % | 176 | % | ||||||||||
Net debt to net capitalization 1 | 947 | % | 223 | % |
Six Months Ended June 30, | ||||||||||||||
(dollars in millions) | 2022 | 2021 | ||||||||||||
Net cash flows provided by operating activities | $ | 857 | $ | 1,118 |
Six Months Ended June 30, | ||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | Change | |||||||||||||||||
Investing Activities: | ||||||||||||||||||||
Capital expenditures | $ | (57) | $ | (84) | $ | 27 | ||||||||||||||
Investments in businesses and intangible assets, net of cash acquired | (28) | (51) | 23 | |||||||||||||||||
Proceeds from the sale of (investments in) marketable securities | (7) | 40 | (47) | |||||||||||||||||
Receipts (payments) on settlements of derivative contracts | 78 | 17 | 61 | |||||||||||||||||
Other investing activities, net | 4 | 11 | (7) | |||||||||||||||||
Net cash flows used in investing activities | $ | (10) | $ | (67) | $ | 57 | ||||||||||||||
Six Months Ended June 30, | ||||||||||||||||||||
(dollars in millions) | 2022 | 2021 | Change | |||||||||||||||||
Financing Activities: | ||||||||||||||||||||
Increase (decrease) in short-term borrowings, net | $ | 57 | $ | (345) | $ | 402 | ||||||||||||||
Proceeds from issuance of long-term debt | — | 199 | (199) | |||||||||||||||||
Payment of debt issuance costs | — | (2) | 2 | |||||||||||||||||
Repayment of long-term debt | (500) | — | (500) | |||||||||||||||||
Dividends paid on Common Stock | (224) | (189) | (35) | |||||||||||||||||
Repurchases of Common Stock | (400) | (506) | 106 | |||||||||||||||||
Dividends paid to noncontrolling interest | (41) | (55) | 14 | |||||||||||||||||
Acquisition of Zardoya Otis shares | (1,802) | — | (1,802) | |||||||||||||||||
Other financing activities, net | (27) | (18) | (9) | |||||||||||||||||
Net cash flows provided by (used in) financing activities | $ | (2,937) | $ | (916) | $ | (2,021) |
(dollars in millions) | Six Months Ended June 30, 2022 | |||||||
OWC Statement of Operations - Standalone and Unconsolidated | ||||||||
Revenue | $ | — | ||||||
Cost of revenue | — | |||||||
Operating expenses | (1) | |||||||
Income from consolidated subsidiaries | 60 | |||||||
Income (loss) from operations excluding income from consolidated subsidiaries | 2 | |||||||
Net income (loss) excluding income from consolidated subsidiaries | (49) |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
OWC Balance Sheet - Standalone and Unconsolidated | ||||||||||||||
Current assets (excluding intercompany receivables from non-guarantor subsidiaries) | $ | 85 | $ | 197 | ||||||||||
Current assets (intercompany receivables from non-guarantor subsidiaries) | — | — | ||||||||||||
Noncurrent assets, investments in consolidated subsidiaries | 1,271 | 1,271 | ||||||||||||
Noncurrent assets (excluding investments in consolidated subsidiaries) | 46 | 48 | ||||||||||||
Current liabilities (intercompany payables to non-guarantor subsidiaries) | 2,455 | 1,516 | ||||||||||||
Current liabilities (excluding intercompany payables to non-guarantor subsidiaries) | 127 | 73 | ||||||||||||
Noncurrent liabilities | 5,184 | 5,725 |
(dollars in millions) | Six Months Ended June 30, 2022 | |||||||
Highland Statement of Operations - Standalone and Unconsolidated | ||||||||
Revenue | $ | — | ||||||
Cost of revenue | — | |||||||
Operating expenses | — | |||||||
Income from consolidated subsidiaries | 738 | |||||||
Income (loss) from operations excluding income from consolidated subsidiaries | — | |||||||
Net income (loss) excluding income from consolidated subsidiaries | (4) |
(dollars in millions) | June 30, 2022 | December 31, 2021 | ||||||||||||
Highland Balance Sheet - Standalone and Unconsolidated | ||||||||||||||
Current assets (excluding intercompany receivables from non-guarantor subsidiaries) | $ | — | $ | — | ||||||||||
Current assets (intercompany receivables from non-guarantor subsidiaries) | 2 | 2 | ||||||||||||
Noncurrent assets (investments in consolidated subsidiaries) | 12,524 | 12,524 | ||||||||||||
Noncurrent assets (intercompany receivables from non-guarantor subsidiaries) | 622 | 666 | ||||||||||||
Noncurrent assets (excluding investments in consolidated subsidiaries) | — | — | ||||||||||||
Current liabilities (intercompany payables to non-guarantor subsidiaries) | 370 | 171 | ||||||||||||
Current liabilities (excluding intercompany payables to non-guarantor subsidiaries) | 5 | 2 | ||||||||||||
Noncurrent liabilities | 1,674 | 1,795 |
2022 | Total Number of Shares Purchased (thousands) | Average Price Paid per Share (1) | Total Number of Shares Purchased as Part of a Publicly Announced Program (thousands) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (dollars in millions) | ||||||||||||||||||||||
April 1 - April 30 | — | $ | — | — | $ | 1,000 | ||||||||||||||||||||
May 1 - May 31 | 2,706 | 73.91 | 2,706 | $ | 800 | |||||||||||||||||||||
June 1 - June 30 | — | — | — | $ | 800 | |||||||||||||||||||||
Total | 2,706 | $ | 73.91 | 2,706 |
Exhibit Number | Exhibit Description | |||||||
10.1 | ||||||||
10.2 | ||||||||
15 | ||||||||
31.1 | ||||||||
31.2 | ||||||||
31.3 | ||||||||
32 | ||||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.* | |||||||
101.SCH | XBRL Taxonomy Extension Schema Document.* | |||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document.* | |||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document.* | |||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document.* | |||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document.* | |||||||
104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document. | |||||||
OTIS WORLDWIDE CORPORATION (Registrant) | |||||||||||
Dated: | July 28, 2022 | by: | /s/ RAHUL GHAI | ||||||||
Rahul Ghai | |||||||||||
Executive Vice President and Chief Financial Officer | |||||||||||
(on behalf of the Registrant and as the Registrant's Principal Financial Officer) | |||||||||||
Dated: | July 28, 2022 | by: | /s/ MICHAEL P. RYAN | ||||||||
Michael P. Ryan | |||||||||||
Vice President and Chief Accounting Officer | |||||||||||
(on behalf of the Registrant and as the Registrant's Principal Accounting Officer) |
Courtesy Translation. In case of discrepancy, the Spanish version shall prevail. | |||||
CARTA DE RESOLUCION DEL CONTRATO SUSCRITO ENTRE LA ZARDOYA OTIS, S.A. Y EL PRESIDENTE | TERMINATION LETTER OF THE SERVICES AGREEMENT BETWEEN ZARDOYA OTIS, S.A. AND THE CHAIRMAN | ||||
Don Bernardo Calleja Calle Golfo de Salónica, 73 28033 Madrid | Mr. Bernardo Calleja Calle Golfo de Salónica, 73 28033 Madrid | ||||
27 de mayo de 2022 | May 27th, 2022 | ||||
Estimado Sr. Calleja: Como Ud. Conoce, las acciones de Zardoya Otis, S.A. (la Sociedad) han sido excluidas de cotización como consecuencia de la OPA lanzada por Otis Worldwide Corporation para adquirir las acciones de la Sociedad de las que no era titular. | Dear Sr. Calleja: As you know, the shares of Zardoya Otis, S.A. (the “Company”) were delisted earlier this month when Otis Worldwide Corporation executed the squeeze out provision to acquire the remaining interest in the Company that it did not already own. | ||||
Le escribimos en relación con el contrato suscrito entre Ud. y Zardoya Otis, S.A. (la “Sociedad”) el 26 de enero de 2021, modificado el 3 de febrero de 2021(el “Contrato”). Con fecha de hoy, el Consejo de Administración ha ratificado su nombramiento como Presidente del mismo, si bien continuará como Consejero No ejecutivo, lo que implica que el cargo no será remunerado. Por la presente le informamos de que, como consecuencia de la exclusión de cotización de la Sociedad, y de acuerdo con lo aprobado en el día de hoy por el Consejo de Administración, se ha decidido resolver el Contrato con efectos 31 de mayo de 2022. | We are writing to you in relation to the services agreement signed between yourself and the Company on January 26, 2021as amended on February 3, 2021 (the “Contract”). On the date hereof, the Board of Directors has ratified your appointment as Chairman of the Board of Directors, but the continuation will be as Non Executive Director and, therefore, no remuneration will be granted. We hereby inform you that, as a consequence of the delisting, and in accordance with the resolution passed today by the Company’s Board of Directors, the Contract has been terminated, effective May 31, 2022. | ||||
En prueba de su conformidad con cuanto antecede, le rogamos proceda a firmar la presente carta y nos devuelva copia firmada como prueba de su aceptación y conformidad. | In witness of your agreement with the foregoing, we ask you to sign this letter and return it to us as proof of your acceptance and assent. | ||||
Atentamente/Sincerelly, | Aceptado y conforme/Accepted and agreed | ||||
Zardoya Otis, S.A. | Madrid, a 27 de Mayo de 2022 | ||||
P.p. | |||||
/s/ DA LOREA GARCIA JAUREGUI | /s/ D. BERNARDO CALLEJA FERNANDEZ | ||||
Dª Lorea Garcia Jauregui | D. Bernardo Calleja Fernández |
Date: | July 28, 2022 | /s/ JUDITH F. MARKS | |||||||||
Judith F. Marks | |||||||||||
Chair, President and Chief Executive Officer |
Date: | July 28, 2022 | /s/ RAHUL GHAI | |||||||||
Rahul Ghai | |||||||||||
Executive Vice President and Chief Financial Officer |
Date: | July 28, 2022 | /s/ MICHAEL P. RYAN | |||||||||
Michael P. Ryan | |||||||||||
Vice President and Chief Accounting Officer |
Date: | July 28, 2022 | /s/ JUDITH F. MARKS | ||||||
Judith F. Marks | ||||||||
Chair, President and Chief Executive Officer | ||||||||
Date: | July 28, 2022 | /s/ RAHUL GHAI | ||||||
Rahul Ghai | ||||||||
Executive Vice President and Chief Financial Officer | ||||||||
Date: | July 28, 2022 | /s/ MICHAEL P. RYAN | ||||||
Michael P. Ryan | ||||||||
Vice President and Chief Accounting Officer |
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
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 348 | $ 379 | $ 701 | $ 731 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | (95) | 20 | (95) | (2) |
Pension and postretirement benefit plan adjustments | 2 | 3 | 4 | 7 |
Change in unrealized cash flow hedging | 0 | 1 | 0 | (3) |
Other comprehensive income (loss), net of tax | (93) | 24 | (91) | 2 |
Comprehensive income (loss), net of tax | 255 | 403 | 610 | 733 |
Less: Comprehensive (income) loss attributable to noncontrolling interest | 14 | (57) | 37 | (87) |
Comprehensive income attributable to Otis Worldwide Corporation | $ 269 | $ 346 | $ 647 | $ 646 |
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for expected credit losses | $ 166 | $ 175 |
Accumulated depreciation | $ 1,141 | $ 1,156 |
Condensed Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
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Statement of Stockholders' Equity [Abstract] | ||||
Cash dividends declared (in usd per share) | $ 0.29 | $ 0.24 | $ 0.53 | $ 0.44 |
General |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General | General The Condensed Consolidated Financial Statements as of June 30, 2022 and for the quarters and six months ended June 30, 2022 and 2021 are unaudited, but in the opinion of management include all adjustments (consisting only of normal recurring adjustments) necessary for a fair statement of the results for the interim periods. The Condensed Consolidated Balance Sheet as of December 31, 2021 was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles ("GAAP") in the United States ("U.S."). The results reported in these Condensed Consolidated Financial Statements should not necessarily be taken as indicative of results that may be expected for the entire year. The financial information included herein should be read in conjunction with the Company's annual consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for fiscal year 2021 ("2021 Form 10-K" or "Form 10-K"). There have been no changes to the Company's significant accounting policies described in the Company's Form 10-K that have a material impact on the Company's Condensed Consolidated Financial Statements and the related notes. Revisions The Company adjusted a misclassification between noncontrolling interest and redeemable noncontrolling interest in the Condensed Consolidated Statements of Changes in Equity as of June 30, 2021, resulting in an increase to Redeemable noncontrolling interest of $100 million, a decrease to Noncontrolling interest of $71 million and a decrease to Accumulated deficit of $29 million. Refer to Note 2 of the Company’s audited consolidated financial statements and notes thereto included in our 2021 Form 10-K. Additionally, following the filing of the Company’s Form 10-Q for the quarterly period ended March 31, 2022, we identified an error in the presentation of the shares of Zardoya Otis, S.A. ("Zardoya Otis") owned by Euro Syns, S.A. As noted in the Form 10-Q for the quarterly period ended March 31, 2022 and herein, the Company previously announced a tender offer to acquire all of the issued and outstanding shares of Zardoya Otis not owned by the Company for cash (the "Tender Offer") in September 2021 and the Tender Offer received regulatory approval on February 28, 2022. As noted in the 2021 Form 10-K, the Company reached an agreement in December 2021 for Euro Syns S.A. to irrevocably tender its Zardoya Otis shares in the Tender Offer. Upon revisiting the accounting for the shares as of March 31, 2022, considering all the relevant facts and circumstances and upon review of the relevant accounting guidance, the Company has determined that upon regulatory approval of the Tender Offer, the shares owned by Euro Syns, S.A. and subject to the agreement reached between the parties that were recorded in Redeemable non-controlling interest for $409 million should have been classified in Forward purchase agreement (a separate new financial statement line item within current liabilities), resulting in a net decrease in Redeemable noncontrolling interest of $409 million. Please refer to the table below for a summary of the impacts to each relevant financial statement line item of the Condensed Consolidated Balance Sheet as of March 31, 2022 to reflect the correct accounting. The effects of these corrections are reflected in these Condensed Consolidated Financial Statements for the quarter and six months ended June 30, 2022, including in the Condensed Consolidated Statement of Changes in Equity, and will be reflected in future filings, as applicable.
There was no impact of this error on the Condensed Consolidated Statement of Operations, Comprehensive Income or the Statement of Cash Flows for the quarter ended March 31, 2022. Separation On April 3, 2020, the Company became an independent publicly-traded company (the "Separation") through a pro-rata distribution of 0.5 shares of Common Stock for every share of United Technologies Corporation, subsequently renamed to Raytheon Technologies Corporation ("UTC" or "RTX", as applicable), common stock held at the close of business on the record date of March 19, 2020. Otis began to trade as a separate public company (New York Stock Exchange: OTIS) on April 3, 2020. Unless the context otherwise requires, references to "Otis", "we", "us", "our" and "the Company" refer to Otis Worldwide Corporation and its subsidiaries. Zardoya Otis Tender Offer The Company previously announced its Tender Offer to acquire all of the issued and outstanding shares of Zardoya Otis not owned by the Company in cash, and its intention to delist the shares of Zardoya Otis from the Spanish stock exchanges subsequent to the Tender Offer. The price per share of the Tender Offer was €7.07 in cash as of March 31, 2022, after adjustments for dividends paid. The Tender Offer was approved by the Spanish regulator on February 28, 2022. As a result of the Tender Offer approval, the issued and outstanding shares of Zardoya Otis owned by Euro Syns, S.A. were reclassified to current liabilities as Forward purchase agreement, and the remaining shares not owned by the Company were deemed redeemable at the option of the other shareholders and were reclassified from Noncontrolling interest to Redeemable noncontrolling interest on our Condensed Consolidated Balance Sheets. The difference between the historical noncontrolling interest carrying value in the balance sheet and the fair value of the Tender Offer was recorded to Accumulated deficit. The results of the Tender Offer were announced on April 7, 2022, with tenders, including of the Euro Syns, S.A.' shares, of 45.49% of the shares outstanding accepted, resulting in the Company owning 95.51% of Zardoya Otis. The shares tendered to the Company were settled in cash on April 12, 2022 for approximately €1.5 billion from the Company's restricted cash held in escrow. The acquisition and settlement of the remaining issued and outstanding shares of Zardoya Otis not owned by the Company for approximately €150 million occurred in the second quarter, with the automatic delisting of Zardoya Otis shares on May 9, 2022. The Company owned a controlling interest and had operational control of Zardoya Otis as of and for the periods ended June 30, 2022 and 2021, and therefore its financial results are included in our Condensed Consolidated Financial Statements. As of March 31 and June 30, 2022, the Company owned 50.02% and 100% of Zardoya Otis, respectively. Use of Estimates. The preparation of these Condensed Consolidated Financial Statements and accompanying notes in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. We assessed certain accounting matters that generally require consideration of forecasted financial information in the context of the information reasonably available to us and the unknown future impacts of COVID-19 as of June 30, 2022 and through the date of this report. The accounting matters assessed included, but were not limited to, our allowance for credit losses, the carrying value of our goodwill and other long-lived assets, financial assets and revenue recognition. While there was not a material impact to our Condensed Consolidated Financial Statements as of June 30, 2022 and for the quarters and six months ended June 30, 2022 and 2021, respectively, resulting from our assessments of these matters, future assessment of our current expectations at that time of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to our Condensed Consolidated Financial Statements in future reporting periods. We also assessed certain accounting matters as they relate to the current crisis in Ukraine and Russia, including, but not limited to our allowance for credit losses, the carrying value of long-lived assets, revenue recognition and the classification of assets. There was not a material impact to our Condensed Consolidated Financial Statements as of June 30, 2022 and for the quarter and six months ended June 30, 2022 resulting from our assessment of these matters. We continue to assess the impact on our results of operations, financial position and overall performance as the situation develops and any broader implications it may have on the global economy. Additionally, the Company determined its business in Russia met the criteria to be classified as held for sale during the quarter ended June 30, 2022, and recorded an impairment loss related to the net assets held for sale. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business. Also see Note 19, "Subsequent Events" for details on the completed sale of our business in Russia in July 2022.
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Earnings per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Share | Earnings per Share
The computation of diluted earnings per share excludes the effect of the potential exercise of stock awards, including stock appreciation rights and stock options, when the average market price of the Common Stock is lower than the exercise price of the related stock awards during the period because the effect would be anti-dilutive. In addition, the computation of diluted earnings per share excludes the effect of the potential exercise of stock awards when the awards' assumed proceeds exceed the average market price of the common shares during the period. There were 2.7 million and 2.1 million of anti-dilutive stock awards excluded from the computation for the quarters ended June 30, 2022 and 2021, respectively, and 2.5 million and 2.1 million for the six months ended June 30, 2022 and 2021, respectively.
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Revenue Recognition |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition We account for revenue in accordance with Accounting Standards Codification ("ASC") Topic 606: Revenue from Contracts with Customers. Contract Assets and Liabilities. Contract assets reflect revenue recognized in advance of customer billing. Contract liabilities are recognized when a customer pays consideration, or we have a right to receive an amount of unconditional consideration, in advance of the satisfaction of performance obligations under the contract. We typically receive progress payments from our customers as we perform our work over time. Total Contract assets and Contract liabilities as of June 30, 2022 and December 31, 2021 are as follows:
Contract assets increased by $58 million during the six months ended June 30, 2022 as a result of the progression of current contracts and timing of billing on customer contracts. Contract liabilities increased by $60 million during the six months ended June 30, 2022 primarily due to contract billings in excess of revenue earned, partially offset by the reclassification of $109 million of contract liabilities, current to liabilities held for sale during the second quarter of 2022. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business. In the six months ended June 30, 2022 and 2021, we recognized revenue of $1.6 billion and $1.7 billion related to contract liabilities as of January 1, 2022 and 2021, respectively. Remaining Performance Obligations ("RPO"). RPO represents the aggregate amount of total contract transaction price that is unsatisfied or partially unsatisfied. As of June 30, 2022, our total RPO was $17.7 billion, including approximately $200 million for our held for sale business in Russia. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business. Of the total RPO as of June 30, 2022, we expect 90% will be recognized as sales over the following 24 months.
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Accounts Receivable, Net |
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Receivables [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable, net consisted of the following as of June 30, 2022 and December 31, 2021:
The changes in allowance for expected credit losses related to Accounts receivable, net for the quarters and six months ended June 30, 2022 and 2021, respectively, are as follows:
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Inventories |
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Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories
Raw materials, work-in-process and finished goods are net of valuation reserves of $99 million as of June 30, 2022 and December 31, 2021. Inventories decreased during the six months ended June 30, 2022 due to the reclassification of $19 million of raw materials and work-in-process and $31 million of finished goods to assets held for sale during the second quarter of 2022. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business.
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Business Acquisitions, Dispositions, Goodwill and Intangible Assets |
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Business Combinations, Goodwill, and Intangible Assets [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisitions, Dispositions, Goodwill and Intangible Assets | Business Acquisitions, Dispositions, Goodwill and Intangible Assets Business Acquisitions. Our investments in businesses and intangibles assets, net of cash acquired, totaled $28 million and $51 million in the six months ended June 30, 2022 and 2021, respectively. The acquisitions and investments consisted of a number of acquisitions primarily in our Service segment. Transaction costs incurred were not considered significant. Goodwill. Changes in our Goodwill balances during the six months ended June 30, 2022 were as follows:
1 Includes reclassification of $29 million of goodwill to assets held for sale during the second quarter of 2022, primarily New Equipment. For additional information, refer to the subheading "Held For Sale Assets and Liabilities" below. Intangible Assets. Intangible assets cost and accumulated amortization were $2,014 million and $1,629 million, respectively, as of June 30, 2022, and $2,117 million and $1,698 million, respectively, as of December 31, 2021. Amortization of intangible assets for the quarter and six months ended June 30, 2022 was $18 million and $37 million, respectively, compared to $22 million and $45 million for the same periods in 2021. Excluding the impact of currency translation adjustments, there were no other significant changes in our Intangible Assets during the quarters and six months ended June 30, 2022 and 2021. Held For Sale Assets and Liabilities. As of June 30, 2022, assets and liabilities held for sale were $166 million and $136 million, respectively, and are included in Other current assets and Accrued liabilities in the Condensed Consolidated Balance Sheets, respectively. There were no balances as of December 31, 2021. In June 2022, we entered into an agreement to sell our business in Russia to a third party. As of June 30, 2022, our operations in Russia, primarily in the New Equipment segment, are classified as assets and liabilities held for sale. It is the Company's intention to complete the sale of these assets and liabilities within the next 12 months. Our Russia operations included assets held for sale of $157 million and liabilities held for sale of $136 million, respectively, as of June 30, 2022. The Company recorded an impairment loss of $18 million related to the net assets held for sale in Other expense (income), net in the Condensed Consolidated Statements of Operations for the quarter and six months ended June 30, 2022. See Note 19, "Subsequent Events" for details on the completed sale of our business in Russia in July 2022.
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Borrowings and Lines of Credit |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Borrowings and Lines of Credit | Borrowings and Lines of Credit
Commercial Paper. As of June 30, 2022, there were $55 million in borrowings outstanding under the Company's $1.5 billion commercial paper programs. We use our commercial paper borrowings for general corporate purposes including to finance acquisitions, pay dividends, repurchase shares and for debt refinancing. The need for commercial paper borrowings may arise if the use of domestic cash for general corporate purposes exceeds the sum of domestic cash generation and foreign cash repatriated to the U.S. For details regarding the Company's short-term borrowings activity in 2021, refer to Note 10 of the Company's financial statements as of and for the year ended December 31, 2021. Long-term debt. As of June 30, 2022, we have a credit agreement, as amended, with various banks providing for a $1.5 billion unsecured, unsubordinated, 5-year revolving credit facility, with an interest rate of LIBOR plus 125 basis points and a commitment fee rate of 12.5 basis points, that matures in April 2025. As of June 30, 2022, there were no borrowings under the Company's revolving credit facility. As of June 30, 2022, the Company is in compliance with all covenants in the revolving credit agreement and the indentures governing all outstanding long-term debt. Long-term debt consisted of the following:
1 The three-month LIBOR rate as of December 31, 2021 was approximately 0.21%. 2 We may redeem these notes at our option pursuant to certain terms. 3 The Company redeemed its $500 million floating rate notes due in 2023, at par, using cash on hand in January 2022. For additional details regarding the Company's debt in 2021, refer to Note 10 of the Company's financial statements as of and for the year ended December 31, 2021. Debt discounts and debt issuance costs are presented as a reduction of debt on the Condensed Consolidated Balance Sheets and are amortized as a component of interest expense over the term of the related debt using the effective interest method. The Condensed Consolidated Statements of Operations for the quarters and six months ended June 30, 2022 and 2021 reflects the following:
The unamortized debt issuance costs as of June 30, 2022 and December 31, 2021 were $45 million and $51 million, respectively. The average maturity of our long-term debt as of June 30, 2022 is approximately 9.1 years. The average interest expense rate on our borrowings outstanding as of June 30, 2022 and December 31, 2021 was as follows:
The average interest expense rate on our borrowings during the quarters and six months ended June 30, 2022 and 2021 was as follows:
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Employee Benefit Plans |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plans | Employee Benefit Plans Pension and Postretirement Plans. The Company sponsors both funded and unfunded domestic and foreign defined benefit pension and other postretirement benefit plans, and defined contribution plans. Contributions to our plans were as follows:
The following table illustrates the components of net periodic benefit cost for the Company's defined benefit pension plans:
Postretirement Benefit Plans. The Company sponsors postretirement benefit plans that provide health benefits to eligible retirees. The postretirement plans are unfunded. The net periodic benefit cost was less than $1 million for the quarters and six months ended June 30, 2022 and 2021, respectively. Stock-based Compensation. The Company adopted the 2020 Long-Term Incentive Plan (the "Plan") effective April 3, 2020. As of June 30, 2022, approximately 24 million shares remain available for awards under the Plan. Stock-based Compensation Expense The Company measures the cost of all share-based payments, including stock options, at fair value on the grant date and recognizes this cost in the Condensed Consolidated Statements of Operations. A forfeiture rate assumption is applied on grant date to adjust the expense recognition for awards that are not expected to vest. Stock-based compensation expense and the resulting tax benefits were as follows:
As of June 30, 2022, there was approximately $86 million of total unrecognized compensation cost related to non-vested equity awards granted under the Plan. This cost is expected to be recognized ratably over a weighted-average period of 2.1 years.
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Stock |
6 Months Ended |
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Jun. 30, 2022 | |
Equity [Abstract] | |
Stock | Stock Preferred Stock. There are 125 million shares of $0.01 par value authorized Preferred Stock, of which none were issued or outstanding as of June 30, 2022 and December 31, 2021. Common Stock. There are 2 billion shares of $0.01 par value Common Stock authorized. As of June 30, 2022, 435.2 million shares of Common Stock were issued, which includes 15.0 million shares of treasury stock. As of December 31, 2021, 434.7 million shares of Common Stock were issued, which included 9.7 million shares of treasury stock. Share Repurchase Program. As of December 31, 2021, the Company was authorized by the Board of Directors to purchase up to $1 billion of Common Stock under a share repurchase program, of which $275 million was remaining at such time. On March 9, 2022, our Board of Directors revoked any remaining share repurchase authority under the prior share repurchase program and approved a new share repurchase program for up to $1 billion of Common Stock, of which $200 million had been utilized as of June 30, 2022. As a result of the increased debt incurred in 2021 to fund the Tender Offer, we temporarily suspended our share repurchases as we focused on deleveraging. During the quarter ended March 31, 2022, we repaid certain debt and resumed our share repurchases. During the quarter and six months ended June 30, 2022, the Company repurchased 2.7 million and 5.3 million shares, respectively, for approximately $200 million and $400 million, respectively, compared to 2.6 million and 7.3 million shares in the same periods of 2021 for approximately $206 million and $506 million, respectively. The Company's share repurchase program does not obligate it to acquire any specific number of shares. Under this program, shares may be purchased in the open market, in privately negotiated transactions, under accelerated share repurchase programs or under plans complying with rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended (the "Exchange Act").
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Accumulated Other Comprehensive Income (Loss) |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) A summary of the changes in each component of Accumulated other comprehensive income (loss), net of tax, for the quarters and six months ended June 30, 2022 and 2021 is provided below:
Amounts reclassified that relate to defined benefit pension and postretirement plans include amortization of prior service costs and actuarial net losses recognized during each period presented. These costs are recorded as components of net periodic pension cost for each period presented. See Note 8, "Employee Benefit Plans" for additional information.
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Income Taxes |
6 Months Ended |
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Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The decrease in the effective tax rate for the quarter ended June 30, 2022, is primarily due to the elimination of Base Erosion Anti Abuse Tax (“BEAT”) in the U.S., and the release of a tax reserve related to a forward transfer pricing agreement with a European tax authority. In addition, the quarter ended June 30, 2021, included an income tax settlement related to the Separation. The decrease in the effective tax rate for the six months ended June 30, 2022, is partially offset by the absence of a reduction in the deferred tax liability related to repatriation of foreign earnings recorded in the quarter ended March 31, 2021. The Company conducts business globally and, as a result, the Company files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world, including such major jurisdictions as Austria, Belgium, Brazil, Canada, China, France, Germany, Hong Kong, India, Italy, Japan, Mexico, Netherlands, Portugal, South Korea, Spain, Switzerland, the United Kingdom and the United States. With a few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations for years before 2010. In the ordinary course of business, there is inherent uncertainty in quantifying our income tax positions. We assess our income tax positions and record tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances, and information available at the reporting date. The evaluation considers any additional worldwide uncertain tax positions, the closure of tax statutes or the re-valuation of current uncertain tax positions arising from the issuance of legislation, regulatory or other guidance or developments in examinations, in appeals, or in the courts. Based on the preceding factors, it is reasonably possible that within the next 12 months unrecognized tax benefits could change within the range of a $20 million increase to a $330 million decrease and associated interest could change within the range of a $5 million increase to a $150 million decrease. See Note 16, “Contingent Liabilities” for discussion regarding uncertain tax positions, included in the above range, related to pending litigation with respect to certain deductions claimed in Germany.
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Restructuring Costs |
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Restructuring and Related Activities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Costs | Restructuring Costs During the quarter and six months ended June 30, 2022, we recorded restructuring costs totaling $25 million and $39 million, respectively, for new and ongoing restructuring actions. We recorded these charges as follows:
Restructuring Actions. During the six months ended June 30, 2022, we recorded the following restructuring costs: $37 million for restructuring actions initiated in 2022, consisting of $14 million in Cost of products and services sold and $23 million in Selling, general and administrative expenses; $1 million for restructuring actions initiated in 2021 primarily in Selling, general and administrative expenses; and $1 million for restructuring actions initiated prior to 2021. We are targeting to complete in 2022 the majority of remaining restructuring actions initiated in 2022 and 2021, with certain utilization beyond 2022. The following table summarizes expected, incurred and remaining costs for the 2022 and 2021 restructuring actions:
The following table summarizes the accrual balance and utilization for the 2022 and 2021 restructuring actions, which are primarily for severance costs:
Additionally, there is a $16 million accrual balance as of June 30, 2022 for restructuring actions initiated prior to 2021 remaining to be utilized. Most of the expected charges will require cash payment.
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Financial Instruments |
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | Financial Instruments We enter into derivative instruments primarily for risk management purposes, including derivatives designated as hedging instruments under ASC 820, Fair Value Measurement. We operate internationally and, in the normal course of business, are exposed to fluctuations in interest rates, commodity prices and foreign exchange rates. These fluctuations can increase the costs of financing, investing in and operating the business. We may use derivative instruments, including swaps, forward contracts and options, to manage certain foreign currency, commodity price and interest rate exposures. The average of the notional amount of foreign exchange contracts hedging foreign currency transactions was $3.5 billion and $3.3 billion as of June 30, 2022 and December 31, 2021, respectively. The average of the notional amount of contracts hedging commodity purchases was $17 million and $16 million as of June 30, 2022 and December 31, 2021, respectively. The following table summarizes the fair value and presentation on the Condensed Consolidated Balance Sheets for derivative instruments as of June 30, 2022 and December 31, 2021:
Derivatives designated as Cash flow hedging instruments. The amounts of gain or (loss) attributable to foreign exchange contract activity reclassified from Accumulated other comprehensive income (loss) were immaterial for the quarters and six months ended June 30, 2022 and 2021, respectively. The effect of cash flow hedging relationships on Accumulated other comprehensive income (loss) as of June 30, 2022 and December 31, 2021 are presented in the table below:
The Company utilizes the critical terms match method in assessing firm commitment derivatives for hedge effectiveness. Accordingly, the hedged items and derivatives designated as hedging instruments are highly effective. Assuming current market conditions continue, a pre-tax gain of $3 million is expected to be reclassified from Accumulated other comprehensive income (loss) into Cost of products sold to reflect the fixed prices obtained from foreign exchange hedging within the next 12 months. All derivative contracts accounted for as cash flow hedges as of June 30, 2022 will mature by October 2025. Net Investment Hedges. We have foreign-denominated long-term debt balances that qualify as net investment hedges. Changes in the value of these net investment hedges due to foreign currency gains or losses are deferred as foreign currency translation adjustments in Other comprehensive income (loss) on the Condensed Consolidated Statements of Comprehensive Income, and will remain in Accumulated other comprehensive income (loss) until the hedged investment is sold or substantially liquidated. We evaluate the effectiveness of the net investment hedges each quarter. We have ¥21.5 billion of Japanese Yen denominated long-term debt, which qualifies as a net investment hedge against our investments in Japanese businesses. As of June 30, 2022, the net investment hedge is deemed to be effective. During the quarter and six months ended June 30, 2022, we recognized gains of $18 million and $30 million, respectively, compared to gains of $1 million and $4 million, respectively, in the same periods of 2021, associated with this net investment hedge in Other comprehensive income (loss). In September 2020, we issued €420 million of Euro denominated commercial paper. The Euro denominated commercial paper while outstanding qualified as a net investment hedge against our investments in European businesses. During 2021, we fully repaid the Euro denominated commercial paper, and there is no longer a net investment hedge against our investments in European businesses as of June 30, 2022 or December 31, 2021. During the quarter and six months ended June 30, 2021, we recognized losses of $5 million and gains of $12 million, respectively, associated with this net investment hedge in Other comprehensive income (loss). Derivatives not designated as Cash flow hedging instruments. The net effect of derivatives not designated as Cash flow hedging instruments primarily within Other income (expense) net, on the Condensed Consolidated Statements of Operations was as follows:
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Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements Valuation Techniques. Our equity securities include equity investments that are traded in active markets, either domestically or internationally, and are measured at fair value using closing stock prices from active markets. The fair value gains or losses related to our equity securities are recorded through net income. Our derivative assets and liabilities include foreign exchange and commodity contracts that are measured at fair value using internal models based on observable market inputs such as forward rates, interest rates, our own credit risk and our counterparties' credit risks. As of June 30, 2022, there has not been any significant impact to the fair value of our derivative liabilities due to our own credit risk. Similarly, there has not been any significant adverse impact to our derivative assets based on our evaluation of our counterparties' credit risks. The fair values of the current portion of the Company's financial instruments that are not carried at fair value approximated their carrying values because of the short-term nature of the current portion. The fair value of receivables, including customer financing notes receivable, net, that were issued long-term are based on the discounted values of their related cash flows at interest rates reflecting the attributes of the counterparties, including geographic location. Customer-specific risk, including credit risk, is already considered in the carrying value of those receivables. Our notes, as described in Note 7, "Borrowings and Lines of Credit", are measured at fair value using closing bond prices from active markets. Recurring Fair Value Measurements. In accordance with the provisions of ASC 820: Fair Value Measurements, the following tables provide the valuation hierarchy classification of assets and liabilities that are carried at fair value and measured on a recurring and non-recurring basis in our Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021:
Fair Value of Financial Instruments. The following table provides carrying amounts and fair values of financial instruments that are not carried at fair value as of June 30, 2022 and December 31, 2021:
The following tables provide the valuation hierarchy classification of assets and liabilities that are not carried at fair value in the Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021:
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Guarantees |
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Guarantees and Product Warranties [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Guarantees | Guarantees The Company provides service and warranty on its products beyond normal service and warranty policies. The changes in the carrying amount of service and product guarantees for the quarters and six months ended June 30, 2022 and 2021 are as follows:
The Company provides certain financial guarantees to third parties. As of June 30, 2022, Otis has stand-by letters of credit with maximum potential payment totaling $142 million. We accrue costs associated with guarantees when it is probable that a liability has been incurred and the amount can be reasonably estimated. The most likely cost to be incurred is accrued based on an evaluation of currently available facts, and where no amount within a range of estimates is more likely, the minimum is accrued. In accordance with ASC Topic 460: Guarantees, we record these liabilities at fair value. As of June 30, 2022, Otis has determined there are no estimated costs probable under these guarantees.
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Contingent Liabilities |
6 Months Ended |
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Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingent Liabilities | Contingent Liabilities Except as otherwise noted, while we are unable to predict the final outcome, based on information currently available, we do not believe that resolution of any of the following matters will have a material adverse effect upon our competitive position, results of operations, cash flows or financial condition. In addition to the specific amounts noted below, where we have recorded loss contingency accruals for the below and other matters, the amounts in aggregate are not material. Legal costs generally are expensed when incurred. Environmental. As previously disclosed, the Company's operations are subject to environmental regulation by authorities with jurisdiction over its operations. The Company has accrued for the costs of environmental remediation activities, including, but not limited to, investigatory, remediation, operating and maintenance costs and performance guarantees, and periodically reassesses these amounts. Management believes that the likelihood of incurring losses materially in excess of amounts accrued is remote. The outstanding liability for environmental obligations was $12 million as of June 30, 2022 and December 31, 2021, and is principally included in Other long-term liabilities on the Condensed Consolidated Balance Sheets. Legal Proceedings. German Tax Litigation As previously disclosed, we have been involved in administrative review proceedings with the German Tax Office, which concern approximately €215 million (approximately $227 million as of June 30, 2022) of tax benefits that we have claimed related to a 1998 reorganization of the corporate structure of our operations in Germany. Upon audit, these tax benefits were disallowed by the German Tax Office. We estimate interest associated with the aforementioned tax benefits is an additional approximately €118 million (approximately $125 million as of June 30, 2022). In August 2012, a suit was filed in the local German Tax Court (Berlin-Brandenburg). In 2015, our former parent, UTC, now RTX, made tax and interest payments to German tax authorities of €275 million (approximately $300 million) in order to avoid additional interest accruals pending final resolution of this matter. In March 2016, the local German Tax Court dismissed the suit, and we appealed this decision to the German Federal Tax Court. Following a hearing in July 2018, the German Federal Tax Court remanded the matter to the local German Tax Court for further proceedings. In December 2020, the local German Tax Court ruled against the Company. On January 26, 2021, the Company filed an appeal with the Federal Tax Court. On February 8, 2022, the Company received the decision of the Federal Tax Court, in which the Court remanded the case for reconsideration by the local German Tax Court. The local Tax Court has not yet set a hearing date. Despite the remand, there is no assurance that the local Tax Court will rule in the Company's favor, and the decision of the German Tax Office ultimately could be sustained. Pursuant to the Tax Matters Agreement ("TMA") with our former parent, UTC, the Company retains the liability associated with the remaining interest, and has recorded an interest accrual of €45 million (approximately $49 million as of June 30, 2022), net of payments and other deductions, included within Accrued liabilities on the Condensed Consolidated Balance Sheets as of June 30, 2022. If the Company prevails in this matter, any recoveries would be allocated between RTX and the Company pursuant to the terms of the TMA. Asbestos Matters As previously disclosed, we have been named as defendants in lawsuits alleging personal injury as a result of exposure to asbestos. While we have never manufactured any asbestos-containing component parts, and no longer incorporate asbestos in any current products, certain of our historical products have contained components manufactured by third parties incorporating asbestos. A substantial majority of these asbestos-related claims have been dismissed without payment or were covered in full or in part by insurance or other forms of indemnity. Additional cases were litigated and settled without any insurance reimbursement. The amounts involved in asbestos related claims were not material individually or in the aggregate as of and for the periods ended June 30, 2022 and December 31, 2021. The estimated range of total liabilities to resolve all pending and unasserted potential future asbestos claims through 2059 is approximately $22 million to $45 million as of June 30, 2022 and December 31, 2021. Because no amount within the range of estimates is more likely to occur than any other, we have recorded the minimum amount of $22 million, which is principally recorded in Other long-term liabilities on our Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021. Amounts are on a pre-tax basis, not discounted, and exclude the Company's legal fees to defend the asbestos claims (which will continue to be expensed as they are incurred). In addition, the Company has an insurance recovery receivable for probable asbestos-related recoveries of approximately $5 million, which is principally included in Other assets on our Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021. Putative Class Action Lawsuit On August 12, 2020, a putative class action lawsuit, (Geraud Darnis et al. v. Raytheon Technologies Corporation et al.), was filed in the United States District Court for the District of Connecticut against Otis, RTX, Carrier Global Corporation ("Carrier"), which was also separated from UTC in the Separation, each of their directors, and various incentive and deferred compensation plans. On September 13, 2021, plaintiffs filed an amended complaint against the three company defendants only. The named plaintiffs are former employees of UTC and its current and former subsidiaries, including Otis and Carrier. They seek to recover monetary damages, as well as related declaratory and equitable relief, based on claimed decreases in the value of long-term incentive awards and deferred compensation under nonqualified deferred compensation plans allegedly caused by the formula used to calculate the adjustments to such awards and deferred compensation from RTX, Carrier, and Otis following the spin-offs of Carrier and Otis and the subsequent combination of UTC and Raytheon Company. Otis believes that the claims against the Company are without merit. At this time, Otis is unable to predict the outcome, or reasonably estimate the possible loss or range of loss, if any, which could result from this action. Other. As previously disclosed, we have commitments and contingent liabilities related to legal proceedings, self-insurance programs and matters arising out of the normal course of business. We accrue contingencies based on a range of possible outcomes. If no amount within this range is a better estimate than any other, we accrue the minimum amount. While it is not possible to determine the ultimate disposition of each of these claims and whether they will be resolved consistent with our beliefs, we expect that the outcome of such claims, individually or in the aggregate, will not have a material adverse effect on our business, financial condition, cash flows or results of operations. As previously disclosed, in certain European countries, claims for overcharges on elevators and escalators related to civil cartel cases have been made, which we have accrued for based on our evaluation of the claims. While it is not possible to determine the ultimate disposition of each of these claims and whether they will be resolved consistent with our beliefs, historical settlement experience of these cases has not been material to the business, financial condition, cash flows or results of operations, however the future outcome of these cases cannot be determined. As previously disclosed, in the ordinary course of business, the Company is also routinely a defendant in, party to or otherwise subject to many pending and threatened legal actions, claims, disputes and proceedings. These matters are often based on alleged violations of contract, product liability, warranty, regulatory, environmental, health and safety, employment, intellectual property, tax and other laws. In some of these proceedings, claims for substantial monetary damages are asserted against the Company and its subsidiaries and could result in fines, penalties, compensatory or treble damages or non-monetary relief. We do not believe that these matters will have a material adverse effect upon our competitive position, results of operations, cash flows or financial condition.
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Segment Financial Data |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Financial Data | Segment Financial Data Our operations are classified into two operating segments: New Equipment and Service. Through the New Equipment segment, we design, manufacture, sell and install a wide range of passenger and freight elevators as well as escalators and moving walkways to customers in the residential and commercial building and infrastructure projects. The Service segment provides maintenance and repair services for both our products and those of other manufacturers, and provides modernization services to upgrade elevators and escalators. The operating segments are generally based on the management structure of the Company, how management allocates resources, assesses performance and makes strategic and operational decisions. Segment Information. Segment information for the quarters ended June 30, 2022 and 2021 are as follows:
Segment information for the six months ended June 30, 2022 and 2021 are as follows:
General corporate expenses and other includes an impairment loss of $18 million for the quarter and six months ended June 30, 2022, related to the net assets held for sale related to our operations in Russia. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business. General corporate expenses and other also includes non-recurring Separation-related costs during the six months ended June 30, 2022 and 2021 of $2 million and $9 million, respectively. There were no non-recurring Separation-related costs during the quarters ended June 30, 2022 and 2021. Total assets are not presented for each segment as they are not presented to, or reviewed by, the Chief Operating Decision Maker. Geographic Sales. Geographic Net sales are attributed to the geographic regions based on their location of origin. With the exception of the U.S. and China, there were no individually significant countries with sales exceeding 10% of Net sales during the quarters and six months ended June 30, 2022 and 2021.
Disaggregated Sales by Type. Segment Net sales disaggregated by product and service type for the quarters and six months ended June 30, 2022 and 2021 are as follows:
Major Customers. There were no customers that individually accounted for 10% or more of the Company's consolidated Net sales for the quarters and six months ended June 30, 2022 and 2021.
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Accounting Pronouncements |
6 Months Ended |
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Jun. 30, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Accounting Pronouncements | Accounting Pronouncements In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The amendments in ASU 2020-04 apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 is currently effective and upon adoption may be applied prospectively to contract modifications made on or before December 31, 2022. We are currently evaluating the impact of adopting this standard but do not expect it to have a material impact on our Condensed Consolidated Financial Statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASC Topic 606, Revenue from Contracts with Customers. ASU 2021-08 is effective for fiscal years beginning after December 15, 2022, with early application permitted. We are currently evaluating the impact of adopting this standard, however we do not expect it to have a material impact on our Condensed Consolidated Financial Statements. Other new accounting pronouncements issued but not effective until after June 30, 2022 did not and are not expected to have a material impact on our financial position, results of operations or liquidity.
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsIn June 2022, we entered into an agreement to sell our business in Russia to a third party. The sale was completed on July 27, 2022. |
General (Policies) |
6 Months Ended |
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Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | Use of Estimates. The preparation of these Condensed Consolidated Financial Statements and accompanying notes in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. We assessed certain accounting matters that generally require consideration of forecasted financial information in the context of the information reasonably available to us and the unknown future impacts of COVID-19 as of June 30, 2022 and through the date of this report. The accounting matters assessed included, but were not limited to, our allowance for credit losses, the carrying value of our goodwill and other long-lived assets, financial assets and revenue recognition. While there was not a material impact to our Condensed Consolidated Financial Statements as of June 30, 2022 and for the quarters and six months ended June 30, 2022 and 2021, respectively, resulting from our assessments of these matters, future assessment of our current expectations at that time of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to our Condensed Consolidated Financial Statements in future reporting periods. We also assessed certain accounting matters as they relate to the current crisis in Ukraine and Russia, including, but not limited to our allowance for credit losses, the carrying value of long-lived assets, revenue recognition and the classification of assets. There was not a material impact to our Condensed Consolidated Financial Statements as of June 30, 2022 and for the quarter and six months ended June 30, 2022 resulting from our assessment of these matters. We continue to assess the impact on our results of operations, financial position and overall performance as the situation develops and any broader implications it may have on the global economy. Additionally, the Company determined its business in Russia met the criteria to be classified as held for sale during the quarter ended June 30, 2022, and recorded an impairment loss related to the net assets held for sale. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business. Also see Note 19, "Subsequent Events" for details on the completed sale of our business in Russia in July 2022.
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General (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Impact of Error Correction to Relevant Financial Statement Line Items | The effects of these corrections are reflected in these Condensed Consolidated Financial Statements for the quarter and six months ended June 30, 2022, including in the Condensed Consolidated Statement of Changes in Equity, and will be reflected in future filings, as applicable.
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Earnings per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per share, basic and diluted |
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Revenue Recognition (Tables) |
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Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of contract assets and liabilities | Total Contract assets and Contract liabilities as of June 30, 2022 and December 31, 2021 are as follows:
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Accounts Receivable, Net (Tables) |
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Receivables [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accounts, notes, loans and financing receivable | Accounts receivable, net consisted of the following as of June 30, 2022 and December 31, 2021:
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Accounts receivable, allowance for credit loss | The changes in allowance for expected credit losses related to Accounts receivable, net for the quarters and six months ended June 30, 2022 and 2021, respectively, are as follows:
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Inventories (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of inventory |
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Business Acquisitions, Dispositions, Goodwill and Intangible Assets (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations, Goodwill, and Intangible Assets [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill | Changes in our Goodwill balances during the six months ended June 30, 2022 were as follows:
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Borrowings and Lines of Credit (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of short-term debt |
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Schedule of long-term debt | Long-term debt consisted of the following:
1 The three-month LIBOR rate as of December 31, 2021 was approximately 0.21%. 2 We may redeem these notes at our option pursuant to certain terms. 3 The Company redeemed its $500 million floating rate notes due in 2023, at par, using cash on hand in January 2022.
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Schedule of debt | Debt discounts and debt issuance costs are presented as a reduction of debt on the Condensed Consolidated Balance Sheets and are amortized as a component of interest expense over the term of the related debt using the effective interest method. The Condensed Consolidated Statements of Operations for the quarters and six months ended June 30, 2022 and 2021 reflects the following:
The average interest expense rate on our borrowings during the quarters and six months ended June 30, 2022 and 2021 was as follows:
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Employee Benefit Plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of defined benefit plans disclosures | Contributions to our plans were as follows:
The following table illustrates the components of net periodic benefit cost for the Company's defined benefit pension plans:
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Share-based payment arrangement, expensed and capitalized, amount | Stock-based compensation expense and the resulting tax benefits were as follows:
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Accumulated Other Comprehensive Income (Loss) (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accumulated other comprehensive income (loss) | A summary of the changes in each component of Accumulated other comprehensive income (loss), net of tax, for the quarters and six months ended June 30, 2022 and 2021 is provided below:
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Restructuring Costs (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of restructuring and related costs | We recorded these charges as follows:
The following table summarizes expected, incurred and remaining costs for the 2022 and 2021 restructuring actions:
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Schedule of restructuring reserve by type of cost | The following table summarizes the accrual balance and utilization for the 2022 and 2021 restructuring actions, which are primarily for severance costs:
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Financial Instruments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of derivative instruments in statement of financial position, fair value | The following table summarizes the fair value and presentation on the Condensed Consolidated Balance Sheets for derivative instruments as of June 30, 2022 and December 31, 2021:
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Schedule of cash flow hedges included in accumulated other comprehensive income (loss) | The effect of cash flow hedging relationships on Accumulated other comprehensive income (loss) as of June 30, 2022 and December 31, 2021 are presented in the table below:
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Derivative instruments, gain (loss) | The net effect of derivatives not designated as Cash flow hedging instruments primarily within Other income (expense) net, on the Condensed Consolidated Statements of Operations was as follows:
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Fair Value Measurements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value measurements, recurring and nonrecurring | In accordance with the provisions of ASC 820: Fair Value Measurements, the following tables provide the valuation hierarchy classification of assets and liabilities that are carried at fair value and measured on a recurring and non-recurring basis in our Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021:
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Fair value, by balance sheet grouping | The following table provides carrying amounts and fair values of financial instruments that are not carried at fair value as of June 30, 2022 and December 31, 2021:
The following tables provide the valuation hierarchy classification of assets and liabilities that are not carried at fair value in the Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021:
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Guarantees (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Guarantees and Product Warranties [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Product warranty disclosure | The changes in the carrying amount of service and product guarantees for the quarters and six months ended June 30, 2022 and 2021 are as follows:
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Segment Financial Data (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment reporting information, by segment | Segment information for the quarters ended June 30, 2022 and 2021 are as follows:
Segment information for the six months ended June 30, 2022 and 2021 are as follows:
General corporate expenses and other includes an impairment loss of $18 million for the quarter and six months ended June 30, 2022, related to the net assets held for sale related to our operations in Russia. See Note 6, "Business Acquisitions, Dispositions, Goodwill and Intangible Assets" for additional information regarding the Company's accounting for its Russia business. General corporate expenses and other also includes non-recurring Separation-related costs during the six months ended June 30, 2022 and 2021 of $2 million and $9 million, respectively. There were no non-recurring Separation-related costs during the quarters ended June 30, 2022 and 2021.
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Schedule of segment reporting information, by geographic markets | Geographic Net sales are attributed to the geographic regions based on their location of origin. With the exception of the U.S. and China, there were no individually significant countries with sales exceeding 10% of Net sales during the quarters and six months ended June 30, 2022 and 2021.
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Segment reporting disclosure, sales type | Segment Net sales disaggregated by product and service type for the quarters and six months ended June 30, 2022 and 2021 are as follows:
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Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
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Net Income (Loss) Attributable to Parent [Abstract] | ||||
Net income attributable to Otis Worldwide Corporation | $ 321 | $ 326 | $ 632 | $ 634 |
Impact of redeemable noncontrolling interest | 0 | 0 | 0 | 0 |
Net income attributable to common shareholders | $ 321 | $ 326 | $ 632 | $ 634 |
Basic weighted average number of shares outstanding (in shares) | 421,400,000 | 427,900,000 | 422,800,000 | 429,800,000 |
Stock awards and equity units (share equivalent) (in shares) | 2,800,000 | 3,700,000 | 3,100,000 | 2,900,000 |
Diluted weighted average number of shares outstanding (in shares) | 424,200,000 | 431,600,000 | 425,900,000 | 432,700,000 |
Earnings Per Share of Common Stock: | ||||
Basic (in usd per share) | $ 0.76 | $ 0.76 | $ 1.49 | $ 1.48 |
Diluted (in usd per share) | $ 0.76 | $ 0.76 | $ 1.48 | $ 1.47 |
Antidilutive securities excluded from computation of EPS (in shares) | 2,700,000 | 2,100,000 | 2,500,000 | 2,100,000 |
Revenue Recognition - Contract With Customer, Assets and Liabilities (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Revenue from Contract with Customer [Abstract] | ||
Contract assets, current | $ 608 | $ 550 |
Total contract assets | 608 | 550 |
Contract liabilities, current | 2,738 | 2,674 |
Contract liabilities, non-current (included within Other long-term liabilities) | 48 | 52 |
Total contract liabilities | 2,786 | 2,726 |
Net contract liabilities | $ 2,178 | $ 2,176 |
Accounts Receivable, Net - Schedule of Accounts Receivable (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
Jun. 30, 2021 |
Dec. 31, 2020 |
---|---|---|---|---|
Receivables [Abstract] | ||||
Trade receivables | $ 3,066 | $ 3,117 | ||
Unbilled receivables | 115 | 109 | ||
Miscellaneous receivables | 96 | 88 | ||
Customer financing notes receivable | 78 | 93 | ||
Total receivables | 3,355 | 3,407 | ||
Less: allowance for expected credit losses | 166 | 175 | $ 170 | $ 161 |
Accounts receivable, net | $ 3,189 | $ 3,232 |
Accounts Receivable, Net - Schedule of Allowance for Credit Losses (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ 175 | $ 161 |
Provision for expected credit losses | 4 | 15 |
Write-offs charged against the allowance for expected credit losses | (13) | (5) |
Foreign exchange and other | 0 | (1) |
Ending balance | $ 166 | $ 170 |
Inventories (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials and work-in-process | $ 135 | $ 140 |
Finished goods | 461 | 482 |
Total | 596 | 622 |
Inventory valuation reserves | 99 | $ 99 |
Decrease in raw materials and WIP | 19 | |
Decrease in finished goods | $ 31 |
Business Acquisitions, Dispositions, Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Dec. 31, 2021 |
|
Business Combinations, Goodwill, and Intangible Assets [Abstract] | ||||||
Investments in businesses, net of cash acquired | $ 28 | $ 51 | ||||
Reclassification of goodwill to assets held for sale | $ 29 | |||||
Intangible assets cost | 2,014 | $ 2,014 | 2,014 | $ 2,117 | ||
Intangible assets, accumulated amortization | 1,629 | 1,629 | 1,629 | 1,698 | ||
Amortization of intangible assets | 18 | $ 22 | 37 | $ 45 | ||
Business Combination Segment Allocation [Line Items] | ||||||
Assets held for sale | 166 | 166 | 166 | 0 | ||
Liabilities held for sale | 136 | 136 | 136 | $ 0 | ||
RUSSIAN FEDERATION | ||||||
Business Combination Segment Allocation [Line Items] | ||||||
Assets held for sale, disposal group | 157 | 157 | 157 | |||
Liabilities held for sale, disposal group | $ 136 | 136 | 136 | |||
Impairment loss related to net assets held for sale | $ 18 | $ 18 |
Business Acquisitions, Dispositions, Goodwill and Intangible Assets - Schedule of Goodwill (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2022
USD ($)
| |
Goodwill [Roll Forward] | |
Goodwill - Beginning Balance | $ 1,667 |
Goodwill Resulting From Business Combinations | 10 |
Foreign Currency Translation and Other 1 | (127) |
Goodwill - Ending Balance | 1,550 |
New Equipment | |
Goodwill [Roll Forward] | |
Goodwill - Beginning Balance | 336 |
Goodwill Resulting From Business Combinations | 0 |
Foreign Currency Translation and Other 1 | (45) |
Goodwill - Ending Balance | 291 |
Services | |
Goodwill [Roll Forward] | |
Goodwill - Beginning Balance | 1,331 |
Goodwill Resulting From Business Combinations | 10 |
Foreign Currency Translation and Other 1 | (82) |
Goodwill - Ending Balance | $ 1,259 |
Borrowings and Lines of Credit - Short-Term Borrowings (Details) € in Millions, $ in Millions |
Jun. 30, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
Sep. 30, 2020
EUR (€)
|
---|---|---|---|
Debt Disclosure [Abstract] | |||
Commercial paper | $ 55 | $ 0 | € 420 |
Other borrowings | 26 | 24 | |
Total short-term borrowings | $ 81 | $ 24 |
Borrowings and Lines of Credit - Schedule of Debt Issuance Expenses (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Debt Disclosure [Abstract] | ||||
Debt issuance costs amortization | $ 2 | $ 2 | $ 5 | $ 3 |
Total interest expense on external debt | $ 35 | $ 34 | $ 71 | $ 67 |
Borrowings and Lines of Credit - Schedule of Average Interest Rates on Borrowings (Details) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Dec. 31, 2021 |
|
Long-term Debt | |||||
Debt Instrument [Line Items] | |||||
Average interest expense rate on borrowings | 2.00% | 2.00% | 1.90% | ||
Average interest expense rate during period | 2.00% | 2.30% | 2.00% | 2.40% | |
Short-term Debt | |||||
Debt Instrument [Line Items] | |||||
Average interest expense rate on borrowings | 1.90% | 1.90% | 0.00% | ||
Average interest expense rate during period | 1.10% | (0.30%) | 0.70% | (0.30%) |
Employee Benefit Plans - Schedule of Defined Benefit Plan Disclosures (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Defined Benefit Plan Disclosure [Line Items] | ||||
Defined benefit plans | $ 9 | $ 5 | $ 21 | $ 18 |
Defined contribution plans | 15 | 14 | 35 | 33 |
Multi-employer pension and postretirement plans | 38 | 42 | 61 | 80 |
Pension Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 10 | 11 | 20 | 22 |
Interest cost | 5 | 4 | 9 | 7 |
Expected return on plan assets | (7) | (6) | (13) | (12) |
Recognized actuarial net loss | 2 | 4 | 5 | 9 |
Total net periodic benefit cost | 10 | 13 | 21 | 26 |
Other Postretirement Benefits Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Total net periodic benefit cost | $ 1 | $ 1 | $ 1 | $ 1 |
Employee Benefit Plans - Schedule of Share-based Compensation and Related Income Tax Benefits (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Stock-based compensation expense | $ 15 | $ 18 | $ 27 | $ 32 |
Less: future tax benefit | 2 | 2 | 3 | 4 |
Stock-based compensation expense, net of tax | 13 | 16 | 24 | 28 |
Share-based Payment Arrangement | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Stock-based compensation expense | 15 | 17 | 28 | 31 |
Liability Awards, Share-Based Compensation Arrangement | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Stock-based compensation expense | $ 0 | $ 1 | $ (1) | $ 1 |
Employee Benefit Plans - Narrative (Details) shares in Millions, $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2022
USD ($)
shares
| |
Retirement Benefits [Abstract] | |
Common stock shares available for awards (in shares) | shares | 24 |
Unrecognized compensation cost | $ | $ 86 |
Unrecognized compensation cost, period for recognition | 2 years 1 month 6 days |
Stock (Details) - USD ($) $ / shares in Units, shares in Millions |
3 Months Ended | 4 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Mar. 09, 2022 |
Dec. 31, 2021 |
|
Equity [Abstract] | |||||||
Preferred stock, shares authorized (in shares) | 125.0 | 125.0 | 125.0 | 125.0 | |||
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||
Preferred stock, shares outstanding (in shares) | 0.0 | 0.0 | 0.0 | 0.0 | |||
Preferred stock, shares issued (in shares) | 0.0 | 0.0 | 0.0 | 0.0 | |||
Common stock, shares authorized (in shares) | 2,000.0 | 2,000.0 | 2,000.0 | 2,000.0 | |||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||
Common stock, shares issued (in shares) | 435.2 | 435.2 | 435.2 | 434.7 | |||
Treasury stock (in shares) | 15.0 | 15.0 | 15.0 | 9.7 | |||
Stock repurchase program, authorized amount | $ 1,000,000,000 | $ 1,000,000,000 | |||||
Stock repurchase program, remaining authorized shares amount | $ 275,000,000 | ||||||
Stock repurchased during period | $ 200,000,000 | $ 206,000,000 | $ 200,000,000 | $ 400,000,000 | $ 506,000,000 | ||
Stock repurchase during period (in shares) | 2.7 | 2.6 | 5.3 | 7.3 |
Income Taxes (Details) $ in Millions |
Jun. 30, 2022
USD ($)
|
---|---|
Income Tax Disclosure [Abstract] | |
Increase in unrecognized tax benefits reasonably possible | $ 20 |
Decrease in unrecognized tax benefits reasonably possible | 330 |
Increase in unrecognized tax benefits, accrued interest, is reasonably possible | 5 |
Decrease in unrecognized tax benefits, accrued interest, is reasonably possible | $ 150 |
Restructuring Costs - Pre-Tax Restructuring Costs (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | $ 25 | $ 11 | $ 39 | $ 26 |
Cost of products and services sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | 11 | 10 | 14 | 14 |
Selling, general and administrative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | $ 14 | $ 1 | 25 | $ 12 |
2022 Actions | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | 37 | |||
2022 Actions | Cost of products and services sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | 14 | |||
2022 Actions | Selling, general and administrative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | 23 | |||
2021 Actions | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | $ 1 |
Restructuring Costs - Schedule of Pretax Restructuring Costs (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | $ 25 | $ 11 | $ 39 | $ 26 |
Cost of products and services sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | 11 | 10 | 14 | 14 |
Selling, general and administrative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Net restructuring costs | $ 14 | $ 1 | $ 25 | $ 12 |
Restructuring Costs - Schedule of Restructuring Costs Expected, Incurred, and Remaining (Details) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
|
2022 Actions | |||
Restructuring Reserve [Roll Forward] | |||
Expected Costs | $ 58 | ||
Cost Incurred | (13) | $ (24) | |
Remaining Costs | 21 | ||
2021 Actions | |||
Restructuring Reserve [Roll Forward] | |||
Expected Costs | 47 | ||
Cost Incurred | (1) | $ 0 | $ (41) |
Remaining Costs | $ 5 |
Restructuring Costs - Restructuring Roll forward (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Restructuring Reserve [Roll Forward] | ||||
Net restructuring costs | $ 25 | $ 11 | $ 39 | $ 26 |
2022 Actions | ||||
Restructuring Reserve [Roll Forward] | ||||
Net restructuring costs | 37 | |||
2022 Actions | Severance costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring reserve, beginning balance | 11 | 0 | ||
Net restructuring costs | 24 | 37 | ||
Utilization, foreign exchange and other costs | (11) | (13) | ||
Restructuring reserve, ending balance | 24 | 24 | ||
2021 Actions | ||||
Restructuring Reserve [Roll Forward] | ||||
Net restructuring costs | 1 | |||
2021 Actions | Severance costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring reserve, beginning balance | 13 | 22 | ||
Net restructuring costs | 0 | 1 | ||
Utilization, foreign exchange and other costs | (5) | (15) | ||
Restructuring reserve, ending balance | 8 | 8 | ||
Prior to 2021 | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring reserve, ending balance | $ 16 | $ 16 |
Financial Instruments - Schedule of Gain (Loss) on Derivative Instruments Reclassified From OCI (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Gain (loss) recorded in Accumulated other comprehensive income (loss) | $ 7 | $ 7 |
Financial Instruments - Schedule of Gain (Loss) on Derivative Instruments in Other Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Foreign Exchange Contract | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Foreign exchange contracts | $ (3) | $ 0 | $ 3 | $ (1) |
Guarantees - Guarantees and Product Warranties Rollforward (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Movement Warranties [Roll Forward] | ||
Beginning balance | $ 20 | $ 25 |
Warranties | 0 | 2 |
Settlements made | (6) | (7) |
Foreign exchange and other | 0 | 3 |
Ending balance | $ 14 | $ 23 |
Guarantees - Narrative (Details) $ in Millions |
Jun. 30, 2022
USD ($)
|
---|---|
Standby Letter of Credit | |
Guarantor Obligations [Line Items] | |
Guarantor obligation, maximum exposure | $ 142 |
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