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Segment Information
 3 Months Ended
Mar. 31, 2023
Segment Reporting [Abstract]  
Segment Information Segment Information
A.     Basis for Segment Information

The Chief Operating Decision Maker (the CEO) allocates resources and manages performance for our six operating segments described as follows. Our operating segments provide financing alternatives to customers and dealers around the world for Caterpillar products and services and power generation facilities that, in most cases, incorporate Caterpillar products. Financing plans 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.
•Power Finance - Provides financing worldwide 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 March 31 was as follows:
(Millions of dollars)


 
2023
External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at March 31, 2023Capital
expenditures
North America$418 $149 $95 $123 $5 $15,208 $222 
EAME84 26 21 14 — 5,194 24 
Asia/Pacific70 34 23 1 (1)3,851 1 
Latin America82 19 40 3 6 2,719 3 
Mining88 34 15 32 (1)2,685 23 
Power Finance14 5 6 1 — 684 — 
Total Segments756 267 200 174 9 30,341 273 
Unallocated15 (110)76 — — 1,816 5 
Timing(3)— — — — 19 — 
Methodology— 47 (59)— — 192 — 
Inter-segment Eliminations (1)
— — — — — (162)— 
Total$768 $204 $217 $174 $9 $32,206 $278 
2022External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at
December 31, 2022		Capital
expenditures
North America$359 $127 $54 $128 $6 $15,229 $199 
EAME67 — 7 14 26 5,067 14 
Asia/Pacific75 37 17 1 1 3,921 2 
Latin America58 19 26 2 (1)2,636 2 
Mining72 20 8 38 (2)2,700 22 
Power Finance19 15 3 1 (3)704 — 
Total Segments650 218 115 184 27 30,257 239 
Unallocated5 (72)42 — — 1,628 2 
Timing(3)1 — — — 18 — 
Methodology— 46 (51)— — 278 — 
Inter-segment Eliminations (1)
— — — — — (224)— 
Total$652 $193 $106 $184 $27 $31,957 $241 
 (1) Elimination is primarily related to intercompany loans