Revenue (Notes)

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

REVENUE

Revenue Recognition

Products

Substantially all of Corteva's revenue is derived from product sales. Product sales consist of sales of Corteva's products to farmers, distributors, and manufacturers. Corteva considers purchase orders, which in some cases are governed by master supply agreements, to be a contract with a customer. Contracts with customers are considered to be short-term when the time between order confirmation and satisfaction of the performance obligations is equal to or less than one year. However, the company has some long-term contracts which can span multiple years.

Licenses of Intellectual Property

Corteva enters into licensing arrangements with customers under which it licenses its intellectual property. Revenue from the majority of intellectual property licenses is derived from sales-based royalties. Revenue for licensing agreements that contain sales-based royalties is recognized at the later of (i) when the subsequent sale occurs or (ii) when the performance obligation to which some or all of the royalty has been allocated is satisfied.

Remaining Performance Obligations

Remaining performance obligations represent the transaction price allocated to unsatisfied or partially unsatisfied performance obligations. At June 30, 2020, the company had remaining performance obligations related to material rights granted to customers for contract renewal options of $110 million ($108 million and $104 million at December 31, 2019 and June 30, 2019, respectively). The company expects revenue to be recognized for the remaining performance obligations over the next 1 year to 6 years.

Contract Balances

Contract liabilities primarily reflect deferred revenue from prepayments under contracts with customers where the company receives advance payments for products to be delivered in future periods. Corteva classifies deferred revenue as current or noncurrent based on the timing of when the company expects to recognize revenue. Contract assets primarily include amounts related to contractual rights to consideration for completed performance not yet invoiced. Accounts receivable are recorded when the right to consideration becomes unconditional.

Contract Balances	June 30, 2020		December 31, 2019		June 30, 2019
(In millions)
Accounts and notes receivable - trade1	$	5,787	$	4,396	$	6,102
Contract assets - current2	$	21	$	20	$	19
Contract assets - noncurrent3	$	51	$	49	$	48
Deferred revenue - current4	$	431	$	2,584	$	583
Deferred revenue - noncurrent5	$	109	$	108	$	118

^1.  Included in accounts and notes receivable - net in the interim Condensed Consolidated Balance Sheets.

^2.  Included in other current assets in the interim Condensed Consolidated Balance Sheets.

^3.  Included in other assets in the interim Condensed Consolidated Balance Sheets.

^4.  Included in accrued and other current liabilities in the interim Condensed Consolidated Balance Sheets.

^5.  Included in other noncurrent obligations in the interim Condensed Consolidated Balance Sheets.

Revenue recognized during the six months ended June 30, 2020 from amounts included in deferred revenue at the beginning of the period was $2,271 million ($1,895 million in the six months ended June 30, 2019).

Disaggregation of Revenue

Corteva's operations are classified into two reportable segments: Seed and Crop Protection. The company disaggregates its revenue by major product line and geographic region, as the company believes it best depicts the nature, amount and timing of its revenue and cash flows. Net sales by major product line are included below:

	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
Corn	$	2,057	$	2,309	$	3,921	$	3,777
Soybean	1,085		998		1,266		1,129
Other oilseeds	219		200		467		425
Other	177		192		339		335
Seed	3,538		3,699		5,993		5,666
Herbicides1	909		1,003		1,732		1,764
Insecticides1	445		452		823		828
Fungicides1	224		302		453		522
Other1	75		100		146		172
Crop Protection	1,653		1,857		3,154		3,286
Total	$	5,191	$	5,556	$	9,147	$	8,952

1. Prior periods have been reclassified to conform to current period presentation.

Sales are attributed to geographic regions based on customer location. Net sales by geographic region and segment are included below:

Seed	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
North America1	$	2,903	$	3,099	$	4,193	$	4,012
EMEA2	264		274		1,145		1,078
Latin America	206		187		422		365
Asia Pacific	165		139		233		211
Total	$	3,538	$	3,699	$	5,993	$	5,666

Crop Protection	Three Months Ended June 30,				Six Months Ended June 30,
(In millions)	2020		2019		2020		2019
North America1	$	663	$	686	$	1,138	$	1,165
EMEA2	379		393		965		953
Latin America	309		466		527		653
Asia Pacific	302		312		524		515
Total	$	1,653	$	1,857	$	3,154	$	3,286

1. Represents U.S. & Canada.

2.

Europe, Middle East, and Africa ("EMEA").