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Retirement Plans
 12 Months Ended
Dec. 28, 2024
Retirement Benefits [Abstract]  
Retirement Plans Retirement Plans
We provide defined-contribution benefits to eligible employees, as well as some remaining defined-benefit pension and other post-retirement benefits covering certain of our U.S. and Non-U.S. employees. Substantially all of our employees are covered by defined contribution plans. The largest of these plans, the Textron Savings Plan, is a qualified 401(k) plan subject to the Employee Retirement Income Security Act of 1974 (ERISA). Our defined contribution plans cost $164 million, $154 million and $140 million in 2024, 2023 and 2022, respectively. We also provide postretirement benefits other than pensions for certain retired employees in the U.S. that include healthcare, dental care, Medicare Part B reimbursement and life insurance.
A portion of our U.S. employees participate in the legacy defined benefit pension plans which were closed to new participants beginning on January 1, 2010. These legacy plans include the Textron Master Retirement Plan (TMRP), the Bell Helicopter Textron Master Retirement Plan, and the CWC Castings Division of Textron Inc. Hourly-Rated Employees' Pension Plan, which are each subject to the provisions of ERISA and provide a minimum guaranteed benefit to participants. The primary factors affecting the benefits earned by participants in our pension plans are employees’ years of service and compensation levels. Employees hired subsequent to the closure of these plans receive an additional annual cash contribution to their Textron Savings Plan account based on their eligible compensation of up to 4%.
Periodic Benefit Cost (Income)
The components of net periodic benefit cost (income) and other amounts recognized in other comprehensive income (loss) (OCI) are as follows:
Pension BenefitsPostretirement Benefits
Other than Pensions
(In millions)202420232022202420232022
Net periodic benefit cost (income)
Service cost$69 $67 $108 $1 $2 $2 
Interest cost362 364 272 7 8 6 
Expected return on plan assets(635)(610)(609)— — — 
Amortization of prior service cost (credit)9 11 13 (1)(3)(5)
Amortization of net actuarial loss (gain)3 1 87 (8)(8)(4)
Net periodic benefit cost (income)*$(192)$(167)$(129)$(1)$(1)$(1)
Other changes in plan assets and benefit obligations recognized in OCI
Current year actuarial loss (gain)$(561)$109 $(246)$(7)$(7)$(39)
Current year prior service cost19 7 4 — — — 
Amortization of net actuarial gain (loss)(3)(1)(87)8 8 4 
Amortization of prior service credit (cost)(9)(11)(13)1 3 5 
Total recognized in OCI, before taxes$(554)$104 $(342)$2 $4 $(30)
Total recognized in net periodic benefit cost (income) and OCI$(746)$(63)$(471)$1 $3 $(31)
* Excludes the cost associated with the defined contribution component that is included in certain of our U.S.-based defined benefit pension plans, of $10 million in 2024, and $11 million for both 2023 and 2022.
Obligations and Funded Status
All of our plans are measured as of our fiscal year-end. The changes in the projected benefit obligation and in the fair value of plan assets, along with our funded status, are as follows:
Pension BenefitsPostretirement Benefits
Other than Pensions
(In millions)December 28, 2024December 30, 2023December 28, 2024December 30, 2023
Change in projected benefit obligation
Projected benefit obligation at beginning of year$7,205 $6,848 $136 $150 
Service cost69 67 1 2 
Interest cost362 364 7 8 
Plan participants’ contributions— — 3 3 
Actuarial losses (gains)(392)330 (7)(7)
Benefits paid(454)(444)(19)(20)
Plan amendment19 7 — — 
Foreign exchange rate changes and other(21)33 — — 
Projected benefit obligation at end of year$6,788 $7,205 $121 $136 
Change in fair value of plan assets
Fair value of plan assets at beginning of year$8,413 $7,943 
Actual return on plan assets806 832 
Employer contributions34 36 
Benefits paid(454)(444)
Foreign exchange rate changes and other(27)46 
Fair value of plan assets at end of year$8,772 $8,413 
Funded status at end of year$1,984 $1,208 $(121)$(136)
Actuarial losses (gains) for 2024 and 2023 were largely the result of changes in the discount rate utilized.
Amounts recognized in our balance sheets are as follows:
Pension BenefitsPostretirement Benefits
Other than Pensions
(In millions)December 28, 2024December 30, 2023December 28, 2024December 30, 2023
Non-current assets$2,311 $1,569 $— $— 
Current liabilities(29)(28)(15)(17)
Non-current liabilities(298)(333)(106)(119)
Recognized in Accumulated other comprehensive loss, pre-tax:
Net loss (gain)167 730 (69)(69)
Prior service cost (credit)52 42 (1)(3)
The accumulated benefit obligation for all defined benefit pension plans was $6.5 billion and $6.9 billion at December 28, 2024 and December 30, 2023, respectively, which included $316 million and $336 million, respectively, in accumulated benefit obligations for unfunded plans where funding is not permitted or in foreign environments where funding is not feasible.
Pension plans with accumulated benefit obligation exceeding the fair value of plan assets are as follows:
(In millions)December 28, 2024December 30, 2023
Accumulated benefit obligation$316 $336 
Fair value of plan assets— — 
Pension plans with projected benefit obligation exceeding the fair value of plan assets are as follows:
(In millions)December 28, 2024December 30, 2023
Projected benefit obligation$327 $652 
Fair value of plan assets— 292 
Assumptions
The weighted-average assumptions we use for our pension and postretirement plans are as follows:
Pension BenefitsPostretirement Benefits
Other than Pensions
202420232022202420232022
Net periodic benefit cost
Discount rate5.19%5.51%2.99%5.40%5.70%2.80%
Expected long-term rate of return on assets7.16%7.14%7.10%
Rate of compensation increase3.97%3.97%3.95%
Benefit obligations at year-end
Discount rate5.73%5.19%5.51%5.75%5.40%5.70%
Rate of compensation increase3.97%3.97%3.97%
Interest crediting rate for cash balance plans5.25%5.25%5.25%
Our assumed healthcare cost trend rate for both the medical and prescription drug cost was 6.50% in 2024 and 6.50% in 2023. We expect this rate to gradually decline to 4.75% by 2031 where we assume it will remain.
Pension Assets
The expected long-term rate of return on plan assets is determined based on a variety of considerations, including the established asset allocation targets and expectations for those asset classes, historical returns of the plans’ assets and other market considerations. We invest our pension assets with the objective of achieving a total rate of return over the long term that will be sufficient to fund future pension obligations and to minimize future pension contributions. We are willing to tolerate a commensurate level of risk to achieve this objective based on the funded status of the plans and the long-term nature of our pension liability. Risk is controlled by maintaining a portfolio of assets that is diversified across a variety of asset classes, investment styles and investment managers. Where possible, investment managers are prohibited from owning our securities in the portfolios that they manage on our behalf.
For U.S. plan assets, which represent the majority of our plan assets, asset allocation target ranges are established consistent with our investment objectives, and the assets are rebalanced periodically.  For Non-U.S. plan assets, allocations are based on expected cash flow needs and assessments of the local practices and markets.  Our target allocation ranges are as follows:
U.S. Plan Assets
Domestic equity securities17 %to33%
International equity securities6 %to17%
Global equities5 %to17%
Debt securities27 %to38%
Real estate7 %to13%
Private investment partnerships7 %to13%
Non-U.S. Plan Assets
Equity securities55 %to75%
Debt securities25 %to45%
Real estate— %to13%
The fair value of our pension plan assets by major category and valuation method is as follows:
December 28, 2024December 30, 2023
(In millions)Level 1Level 2Level 3Not
Subject to
Leveling		Level 1Level 2Level 3Not
Subject to
Leveling
Cash and equivalents$159 $1 $— $— $231 $1 $— $— 
Equity securities:
Domestic3,151 — — 307 2,754 — — 299 
International1,028 — — 290 1,061 — — 281 
Mutual funds194 — — — 117 — — — 
Debt securities:
National, state and local governments899 60 — 13 679 142 — 88 
Corporate debt46 618 — 148 164 610 — 90 
Private investment partnerships— — — 974 — — — 1,000 
Real estate— — 479 405 — — 508 388 
Total$5,477 $679 $479 $2,137 $5,006 $753 $508 $2,146 
Cash and equivalents, equity securities and debt securities include commingled funds, which represent investments in funds offered to institutional investors that are similar to mutual funds in that they provide diversification by holding various equity and debt securities. Generally, the fair value of the majority of the commingled funds is determined and published by the fund's investment managers and is the basis for current transactions, therefore, they are categorized as Level 1 in the table above. Certain commingled funds, consisting of underlying equity and fixed income securities, are stated at their Net Asset Value (NAV) per share because such investments do not have readily determinable fair values and, therefore, are not subject to leveling within the fair value hierarchy. The NAV is the total value of the fund divided by the number of the fund’s shares outstanding. Debt securities are valued based on same day actual trading prices, if available. If such prices are not available, we use a matrix pricing model with historical prices, trends and other factors.
Private investment partnerships represents interests in funds which invest in equity, debt and other financial assets.  These funds are generally not publicly traded so the interests therein are valued using income and market methods that include cash flow projections and market multiples for various comparable investments. Real estate includes owned properties and limited partnership interests in real estate partnerships. Owned properties are valued using certified appraisals at least every three years that are updated at least annually by the real estate investment manager based on current market trends and other available information. These appraisals generally use the standard methods for valuing real estate, including forecasting income and identifying current transactions for comparable real estate to arrive at a fair value.  Limited partnership interests in real estate partnerships are valued similarly to private investment partnerships, with the general partner using standard real estate valuation methods to value the real estate properties and securities held within their portfolios.  Neither private investment nor real estate partnerships are subject to leveling within the fair value hierarchy.
The table below presents a reconciliation of the fair value measurements for owned real estate properties, which use significant unobservable inputs (Level 3):
(In millions)20242023
Balance at beginning of year$508 $569 
Unrealized losses, net(25)(60)
Realized gains, net16 10 
Purchases, sales and settlements, net(20)(11)
Balance at end of year$479 $508 
Estimated Future Cash Flow Impact
Defined benefits under salaried plans are based on salary and years of service.  Hourly plans generally provide benefits based on stated amounts for each year of service.  Our funding policy is consistent with applicable laws and regulations.  In 2025, we expect to contribute approximately $50 million to our pension plans. Benefit payments provided below reflect expected future employee service, as appropriate, and are expected to be paid, net of estimated participant contributions. These payments are based on the same assumptions used to measure our benefit obligation at the end of 2024. While pension benefit payments primarily will be paid out of qualified pension trusts, we will pay postretirement benefits other than pensions out of our general corporate assets. Benefit payments that we expect to pay on an undiscounted basis are as follows:
(In millions)20252026202720282029
2030-2034
Pension benefits$459 $467 $476 $484 $491 $2,510 
Postretirement benefits other than pensions16 15 14 13 13 50