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Segment Information
 6 Months Ended
Jun. 30, 2022
Segment Reporting [Abstract]  
Segment Information Segment Information
A.     Basis for Segment Information

We report information internally for operating segments based on management responsibility. Our operating segments provide financing alternatives to customers and dealers around the world for Caterpillar products and services and vehicles, power generation facilities and marine vessels that, in most cases, incorporate Caterpillar products. Financing products include operating and finance leases, retail loans, working capital loans to Caterpillar dealers and wholesale financing plans within each of the operating segments. Certain operating segments also purchase short-term trade receivables from Caterpillar.

B.    Description of Segments

We have six operating segments that offer financing services. Following is a brief description of our segments:

•North America - Includes our operations in the United States and Canada.
•EAME - Includes our operations in Europe, Africa, the Middle East and the Commonwealth of Independent States.
•Asia/Pacific - Includes our operations in Australia, New Zealand, China, Japan, Southeast Asia and India.
•Latin America - Includes our operations in Mexico and Central and South American countries.
•Mining - Provides financing for large mining customers worldwide.
•Caterpillar Power Finance - Provides financing worldwide for marine vessels with Caterpillar engines and for Caterpillar electrical power generation, gas compression and co-generation systems and non-Caterpillar equipment that is powered by these systems.

C.     Segment Measurement and Reconciliations

Cash, debt and other expenses are allocated to our segments based on their respective portfolios. The related Interest expense is calculated based on the amount of allocated debt and the rates associated with that debt. The performance of each segment is assessed based on a consistent leverage ratio. The Provision for credit losses is based on each segment’s respective finance receivable portfolio. Capital expenditures include expenditures for equipment on operating leases and other miscellaneous capital expenditures.

Reconciling items are created based on accounting differences between segment reporting and consolidated external reporting. For the reconciliation of Profit before income taxes, we have grouped the reconciling items as follows:

•Unallocated - This item is related to corporate requirements and strategies that are considered to be for the benefit of the entire organization. Also included are the consolidated results of the special purpose corporation (see Note 7 for additional information) and other miscellaneous items.
•Timing - Timing differences in the recognition of costs between segment reporting and consolidated external reporting.
•Methodology - Methodology differences between segment reporting and consolidated external reporting are as follows:
◦Segment assets include off-balance sheet managed assets for which we maintain servicing responsibilities.
◦The impact of differences between the actual leverage and the segment leverage ratios.
◦Interest expense includes realized forward points on foreign currency forward contracts.
◦The net gain or loss from interest rate derivatives is excluded from segment reporting.
Supplemental segment data and reconciliations to consolidated external reporting for the three months ended June 30 was as follows:
(Millions of dollars)


 
2022
External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at
June 30,
2022		Capital
expenditures
North America$370 $134 $58 $127 $10 $15,430 $248 
EAME68 5 11 14 16 4,785 42 
Asia/Pacific71 34 19 2 3 3,871 1 
Latin America71 15 35 2 6 2,603 16 
Mining74 25 10 36 (8)2,556 25 
Caterpillar Power Finance11 8 2 — (4)743 — 
Total Segments665 221 135 181 23 29,988 332 
Unallocated6 (70)43 — — 1,591 2 
Timing(3)2 — — — 18 — 
Methodology— 46 (58)— — 354 — 
Inter-segment Eliminations (1)
— — — — — (99)— 
Total$668 $199 $120 $181 $23 $31,852 $334 
2021External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at
December 31,
2021		Capital
expenditures
North America$348 $102 $64 $134 $3 $15,755 $266 
EAME68 (6)5 15 32 5,192 17 
Asia/Pacific93 49 25 2 — 4,117 2 
Latin America50 18 15 2 4 2,405 1 
Mining71 39 10 34 (16)2,672 74 
Caterpillar Power Finance14 19 3 — (12)957 — 
Total Segments644 221 122 187 11 31,098 360 
Unallocated4 (75)45 — — 1,458 — 
Timing(2)2 — — — 15 — 
Methodology— 41 (51)— — 18 — 
Inter-segment Eliminations (1)
— — — — — (202)— 
Total$646 $189 $116 $187 $11 $32,387 $360 
 (1) Elimination is primarily related to intercompany loans
Supplemental segment data and reconciliations to consolidated external reporting for the six months ended June 30 was as follows:
(Millions of dollars)


 
2022
External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at
June 30,
2022		Capital
expenditures
North America$729 $261 $112 $255 $16 $15,430 $447 
EAME135 5 18 28 42 4,785 56 
Asia/Pacific146 71 36 3 4 3,871 3 
Latin America129 34 61 4 5 2,603 18 
Mining146 45 18 74 (10)2,556 47 
Caterpillar Power Finance30 23 5 1 (7)743 — 
Total Segments1,315 439 250 365 50 29,988 571 
Unallocated11 (142)85 — — 1,591 4 
Timing(6)3 — — — 18 — 
Methodology— 92 (109)— — 354 — 
Inter-segment Eliminations (1)
— — — — — (99)— 
Total$1,320 $392 $226 $365 $50 $31,852 $575 
2021External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at
December 31,
2021		Capital
expenditures
North America$695 $201 $133 $271 $4 $15,755 $444 
EAME135 24 10 30 28 5,192 27 
Asia/Pacific185 100 48 4 — 4,117 5 
Latin America97 34 29 4 7 2,405 8 
Mining142 57 20 69 (19)2,672 100 
Caterpillar Power Finance27 30 7 1 (19)957 — 
Total Segments1,281 446 247 379 1 31,098 584 
Unallocated9 (147)95 — — 1,458 4 
Timing(5)3 — — — 15 — 
Methodology— 83 (101)— — 18 — 
Inter-segment Eliminations (1)
— — — — — (202)— 
Total$1,285 $385 $241 $379 $1 $32,387 $588 
(1) Elimination is primarily related to intercompany loans.