Revenue (Notes)

6 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

REVENUE

REVENUE

    The following tables disaggregate our revenue by major source for the periods ended June 30 (in millions):

	Second Quarter 2022
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	36,831	$	—	$	36,831
Used vehicles	373		—		373
Services and other revenue (a)	677		52		729
Revenues from sales and services	37,881		52		37,933
Leasing income	53		1,166		1,219
Financing income	—		1,026		1,026
Insurance income	—		12		12
Total revenues	$	37,934	$	2,256	$	40,190
	Second Quarter 2023
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	41,241	$	—	$	41,241
Used vehicles	457		—		457
Services and other revenue (a)	683		49		732
Revenues from sales and services	42,381		49		42,430
Leasing income	46		1,029		1,075
Financing income	—		1,426		1,426
Insurance income	—		23		23
Total revenues	$	42,427	$	2,527	$	44,954
	First Half 2022
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	67,822	$	—	$	67,822
Used vehicles	802		—		802
Services and other revenue (a)	1,399		71		1,470
Revenues from sales and services	70,023		71		70,094
Leasing income	106		2,377		2,483
Financing income	—		2,066		2,066
Insurance income	—		23		23
Total revenues	$	70,129	$	4,537	$	74,666
	First Half 2023
	Company excluding Ford Credit		Ford Credit		Consolidated
Vehicles, parts, and accessories	$	79,168	$	—	$	79,168
Used vehicles	926		—		926
Services and other revenue (a)	1,328		66		1,394
Revenues from sales and services	81,422		66		81,488
Leasing income	90		2,078		2,168
Financing income	—		2,727		2,727
Insurance income	—		45		45
Total revenues	$	81,512	$	4,916	$	86,428

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(a)Includes extended service contract revenue.

NOTE 3. REVENUE (Continued)

The amount of consideration we receive and revenue we recognize on our vehicles, parts, and accessories varies with changes in return rights and marketing incentives we offer to our customers and their customers. Estimates of marketing incentives are based on expected retail and fleet sales volumes, mix of products to be sold, and incentive programs to be offered. Customer acceptance of products and programs, as well as other market conditions, will impact these estimates. As a result of changes in our estimate of marketing incentives, we recorded an increase of $152 million in the second quarter of 2022 and a decrease of $3 million in the second quarter of 2023 related to revenue recognized in prior periods.

We had a balance of $4.4 billion and $4.6 billion of unearned revenue associated primarily with outstanding extended service contracts reported in Other liabilities and deferred revenue at December 31, 2022 and June 30, 2023, respectively. We expect to recognize approximately $800 million of the unearned amount in the remainder of 2023, $1.3 billion in 2024, and $2.5 billion thereafter. We recognized $352 million and $374 million of unearned amounts from prior years as revenue during the second quarter of 2022 and 2023, respectively, and $717 million and $754 million in the first half of 2022 and 2023, respectively.

Amounts paid to dealers to obtain extended service contracts are deferred and recorded as Other assets. We had a balance of $315 million and $320 million in deferred costs as of December 31, 2022 and June 30, 2023, respectively. We recognized $22 million and $25 million of amortization during the second quarter of 2022 and 2023, respectively, and $44 million and $51 million in the first half of 2022 and 2023, respectively.