Equity Activity (Tables)

12 Months Ended

Dec. 31, 2021

Equity Activity

Reclassifications and taxes related to items of other comprehensive income

($ in millions)
	Before Tax		Tax (Expense)/		Net of Tax
For the year ended December 31, 2021:	Amount		Benefit		Amount
Other comprehensive income/(loss)
Foreign currency translation adjustments	$	987	$	(414)	$	573
Net changes related to available-for-sale securities
Unrealized gains/(losses) arising during the period	$	0	$	0	$	0
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	0	$	0	$	0
Unrealized gains/(losses) on cash flow hedges
Unrealized gains/(losses) arising during the period	$	344	$	(89)	$	256
Reclassification of (gains)/losses to:
Cost of services		(43)		11		(32)
Cost of sales		16		(3)		13
Cost of financing		22		(6)		17
SG&A expense		24		(6)		19
Other (income) and expense		157		(40)		118
Interest expense		65		(16)		49
Total unrealized gains/(losses) on cash flow hedges	$	587	$	(149)	$	438
Retirement-related benefit plans(1)
Prior service costs/(credits)	$	(51)	$	(1)	$	(52)
Net (losses)/gains arising during the period		2,433		(601)		1,832
Curtailments and settlements		94		(11)		83
Amortization of prior service (credits)/costs		9		0		9
Amortization of net (gains)/losses		2,484		(528)		1,956
Total retirement-related benefit plans	$	4,969	$	(1,140)	$	3,828
Other comprehensive income/(loss)	$	6,542	$	(1,703)	$	4,839

(1)These AOCI components are included in the computation of net periodic pension cost. Refer to note W, “Retirement-Related Benefits,” for additional information.

($ in millions)
	Before Tax		Tax (Expense)/		Net of Tax
For the year ended December 31, 2020:	Amount		Benefit		Amount
Other comprehensive income/(loss)
Foreign currency translation adjustments	$	(1,500)	$	535	$	(965)
Net changes related to available-for-sale securities
Unrealized gains/(losses) arising during the period	$	(1)	$	0	$	0
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	(1)	$	0	$	0
Unrealized gains/(losses) on cash flow hedges
Unrealized gains/(losses) arising during the period	$	(349)	$	89	$	(261)
Reclassification of (gains)/losses to:
Cost of services		(23)		6		(18)
Cost of sales		(2)		1		(2)
Cost of financing		27		(7)		20
SG&A expense		0		0		0
Other (income) and expense		(101)		25		(75)
Interest expense		78		(20)		58
Total unrealized gains/(losses) on cash flow hedges	$	(370)	$	94	$	(277)
Retirement-related benefit plans(1)
Prior service costs/(credits)	$	(37)	$	7	$	(29)
Net (losses)/gains arising during the period		(1,678)		295		(1,383)
Curtailments and settlements		52		(14)		38
Amortization of prior service (credits)/costs		13		(1)		12
Amortization of net (gains)/losses		2,314		(451)		1,863
Total retirement-related benefit plans	$	664	$	(163)	$	501
Other comprehensive income/(loss)	$	(1,206)	$	466	$	(740)

(1)These AOCI components are included in the computation of net periodic pension cost. Refer to note W, “Retirement-Related Benefits,” for additional information.

($ in millions)
	Before Tax		Tax (Expense)/		Net of Tax
For the year ended December 31, 2019:	Amount		Benefit		Amount
Other comprehensive income/(loss)
Foreign currency translation adjustments	$	(39)	$	29	$	(10)
Net changes related to available-for-sale securities
Unrealized gains/(losses) arising during the period	$	1	$	0	$	1
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	1	$	0	$	1
Unrealized gains/(losses) on cash flow hedges
Unrealized gains/(losses) arising during the period	$	(689)	$	167	$	(522)
Reclassification of (gains)/losses to:
Cost of services		(68)		17		(50)
Cost of sales		(51)		15		(37)
Cost of financing		89		(22)		67
SG&A expense		(53)		14		(39)
Other (income) and expense		(39)		10		(29)
Interest expense		197		(50)		148
Total unrealized gains/(losses) on cash flow hedges	$	(614)	$	151	$	(463)
Retirement-related benefit plans(1)
Prior service costs/(credits)	$	(73)	$	10	$	(63)
Net (losses)/gains arising during the period		(120)		52		(68)
Curtailments and settlements		41		(12)		29
Amortization of prior service (credits)/costs		(9)		5		(4)
Amortization of net (gains)/losses		1,843		(371)		1,471
Total retirement-related benefit plans	$	1,681	$	(316)	$	1,365
Other comprehensive income/(loss)	$	1,029	$	(136)	$	893

(1)These AOCI components are included in the computation of net periodic pension cost. Refer to note W, “Retirement-Related Benefits,” for additional information.

Accumulated other comprehensive income/(loss) (net of tax)

($ in millions)
						Net Change		Net Unrealized
	Net Unrealized		Foreign			Retirement-		Gains/(Losses)		Accumulated
	Gains/(Losses)		Currency			Related		on Available-		Other
	on Cash Flow		Translation			Benefit		For-Sale		Comprehensive
	Hedges		Adjustments		*	Plans		Securities		Income/(Loss)
December 31, 2018	$	284	$	(3,690)		$	(26,083)	$	0	$	(29,490)
Other comprehensive income before reclassifications		(522)		(10)			(131)		1		(663)
Amount reclassified from accumulated other comprehensive income		59		—			1,496		—		1,556
Total change for the period		(463)		(10)			1,365		1		893
December 31, 2019		(179)		(3,700)			(24,718)		0		(28,597)
Other comprehensive income before reclassifications		(261)		(965)			(1,412)		0		(2,638)
Amount reclassified from accumulated other comprehensive income		(16)		—			1,914		—		1,898
Total change for the period		(277)		(965)			501		0		(740)
December 31, 2020		(456)		(4,665)			(24,216)		0		(29,337)
Other comprehensive income before reclassifications		256		573			1,780		0		2,608
Amount reclassified from accumulated other comprehensive income		183		—			2,049		—		2,231
Separation of Kyndryl**		—		730			534		—		1,264
Total change for the period		438		1,303			4,362		0		6,103
December 31, 2021	$	(18)	$	(3,362)		$	(19,854)	$	(1)	$	(23,234)

* Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.

** Refer to note C, “Separation of Kyndryl,” for additional information.