REVENUE RECOGNITION DISAGGREGATION OF REVENUES

3 Months Ended

Mar. 31, 2022

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

NOTE 2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Long-term Contracts

The majority of our contracts are for a period of less than one year. We have certain long-term maintenance agreements, construction contracts and extended warranty coverage arrangements that span a period in excess of one year. The aggregate amount of the transaction price for long-term maintenance agreements and construction contracts allocated to performance obligations that were not satisfied as of March 31, 2022, was $736 million. We expect to recognize the related revenue of $112 million over the next 12 months and $624 million over periods up to 10 years. See Note 11, "PRODUCT WARRANTY LIABILITY," for additional disclosures on extended warranty coverage arrangements. Our other contracts generally are for a duration of less than one year, include payment terms that correspond to the timing of costs incurred when providing goods and services to our customers or represent sales-based royalties.

Deferred and Unbilled Revenue

The following is a summary of our unbilled and deferred revenue and related activity:

In millions	March 31, 2022		December 31, 2021
Unbilled revenue	$	138	$	100
Deferred revenue, primarily extended warranty	1,760		1,705

We recognized revenue of $240 million for the three months ended March 31, 2022, compared with $169 million for the comparable period in 2021, that was included in the deferred revenue balance at the beginning of each year. We did not record any impairment losses on our unbilled revenues during the three months ended March 31, 2022 or April 4, 2021.

Disaggregation of Revenue

Consolidated Revenue

The table below presents our consolidated sales by geographic area. Net sales attributed to geographic areas were based on the location of the customer.

	Three months ended
In millions	March 31, 2022		April 4, 2021
United States	$	3,457	$	3,060
China	653		957
India	309		330
Other international	1,966		1,745
Total net sales	$	6,385	$	6,092

Segment Revenue

Engine segment external sales by market were as follows:

	Three months ended
In millions	March 31, 2022		April 4, 2021
Heavy-duty truck	$	684	$	613
Medium-duty truck and bus	591		483
Light-duty automotive	487		474
Total on-highway	1,762		1,570
Off-highway	287		325
Total sales	$	2,049	$	1,895

Distribution segment external sales by region were as follows:

	Three months ended
In millions	March 31, 2022		April 4, 2021
North America	$	1,371	$	1,166
Asia Pacific	244		213
Europe	143		163
Russia	136		57
China	82		85
India	48		49
Africa and Middle East	46		54
Latin America	41		40
Total sales	$	2,111	$	1,827

Distribution segment external sales by product line were as follows:

	Three months ended
In millions	March 31, 2022		April 4, 2021
Parts	$	926	$	754
Engines	438		333
Power generation	398		416
Service	349		324
Total sales	$	2,111	$	1,827

Components segment external sales by business were as follows:

	Three months ended
In millions	March 31, 2022		April 4, 2021
Emission solutions	$	808	$	966
Filtration	308		301
Turbo technologies	197		225
Automated transmissions	134		115
Electronics and fuel systems	70		117
Total sales	$	1,517	$	1,724

Power Systems segment external sales by product line were as follows:

	Three months ended
In millions	March 31, 2022		April 4, 2021
Power generation	$	399	$	351
Industrial	188		179
Generator technologies	96		82
Total sales	$	683	$	612