Retirement-Related Benefits

6 Months Ended

Jun. 30, 2023

Retirement Benefits [Abstract]

Retirement-Related Benefits

Retirement-Related Benefits:

The company offers defined benefit (DB) pension plans, defined contribution pension plans, as well as nonpension postretirement plans primarily consisting of retiree medical benefits. The following tables provide the pre-tax cost for all retirement-related plans.

					Yr. to Yr.
(Dollars in millions)					Percent
For the three months ended June 30:	2023		2022		Change
Retirement-related plans — cost:
Defined benefit and contribution pension plans — cost	$	259	$	456	(43.2)	%
Nonpension postretirement plans — cost	33		33		(2.2)
Total	$	292	$	489	(40.4)	%

					Yr. to Yr.
(Dollars in millions)					Percent
For the six months ended June 30:	2023		2022		Change
Retirement-related plans — cost:
Defined benefit and contribution pension plans — cost	$	541	$	934	(42.1)	%
Nonpension postretirement plans — cost	65		66		(1.9)
Total	$	606	$	1,000	(39.4)	%

Cost/(Income) of Pension Plans

The following tables provide the components of the cost/(income) for the company’s pension plans.

(Dollars in millions)	U.S. Plans				Non-U.S. Plans
For the three months ended June 30:	2023		2022		2023		2022
Service cost	$	—	$	—	$	44	$	59
Interest cost*	272		302		292		131
Expected return on plan assets*	(382)		(475)		(362)		(259)
Amortization of prior service costs/(credits)*	0		2		5		3
Recognized actuarial losses*	27		179		101		260
Curtailments and settlements*	—		—		6		11
Multi-employer plans	—		—		3		3
Other costs/(credits)*	—		—		10		6
Total net periodic pension (income)/cost of defined benefit plans	$	(82)	$	8	$	99	$	215
Cost of defined contribution plans	151		141		91		92
Total defined benefit and contribution pension plans cost recognized in the Consolidated Income Statement	$	69	$	149	$	190	$	307

(Dollars in millions)	U.S. Plans				Non-U.S. Plans
For the six months ended June 30:	2023		2022		2023		2022
Service cost	$	—	$	—	$	88	$	123
Interest cost*	545		603		580		270
Expected return on plan assets*	(764)		(950)		(718)		(532)
Amortization of prior service costs/(credits)*	0		4		10		7
Recognized actuarial losses*	55		359		203		537
Curtailments and settlements*	—		—		5		19
Multi-employer plans	—		—		6		7
Other costs/(credits)*	—		—		19		15
Total net periodic pension (income)/cost of defined benefit plans	$	(165)	$	15	$	194	$	446
Cost of defined contribution plans	323		282		188		190
Total defined benefit and contribution pension plans cost recognized in the Consolidated Income Statement	$	158	$	298	$	382	$	636

*These components of net periodic pension cost are included in other (income) and expense in the Consolidated Income Statement.

Cost of Nonpension Postretirement Plans

The following tables provide the components of the cost for the company’s nonpension postretirement plans.

(Dollars in millions)	U.S. Plan				Non-U.S. Plans
For the three months ended June 30:	2023		2022		2023		2022
Service cost	$	1	$	1	$	1	$	1
Interest cost*	29		18		10		9
Expected return on plan assets*	—		—		(1)		(1)
Amortization of prior service costs/(credits)*	(7)		1		0		0
Recognized actuarial losses*	—		2		0		1
Curtailments and settlements*	—		—		—		—
Total nonpension postretirement plans cost recognized in the Consolidated Income Statement	$	23	$	23	$	10	$	10

(Dollars in millions)	U.S. Plan				Non-U.S. Plans
For the six months ended June 30:	2023		2022		2023		2022
Service cost	$	2	$	2	$	1	$	2
Interest cost*	58		37		19		18
Expected return on plan assets*	—		—		(1)		(1)
Amortization of prior service costs/(credits)*	(15)		2		0		0
Recognized actuarial losses*	—		4		(1)		2
Curtailments and settlements*	—		—		—		—
Total nonpension postretirement plans cost recognized in the Consolidated Income Statement	$	46	$	46	$	19	$	20

*These components of net periodic pension cost are included in other (income) and expense in the Consolidated Income Statement.

The company does not anticipate any significant changes to the expected plan contributions in 2023 from the amounts disclosed in the 2022 Annual Report.

The table below includes contributions to the following plans:

(Dollars in millions)	Plan Contributions
For the six months ended June 30:	2023		2022
U.S. nonpension postretirement benefit plans	$	134	$	202
Non-U.S. DB and multi-employer plans*	29		43
Total plan contributions	$	163	$	245

*Amounts reported net of refunds.

During the six months ended June 30, 2023 and 2022, the company contributed $134 million and $182 million of U.S. Treasury Securities, respectively, to the U.S. nonpension postretirement benefit plan. Additionally, during the six months ended June 30, 2023 and 2022, the company contributed $347 million and $261 million of U.S. Treasury securities, respectively, to the Active Medical Trust. Contributions made with U.S. Treasury securities are considered a non-cash transaction.