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Segment Information
 6 Months Ended
Jun. 30, 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 Eurasia.
•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 - 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 June 30 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
June 30, 2023		Capital
expenditures
North America$436 $154 $108 $127 $2 $15,777 $293 
EAME88 18 25 15 2 5,100 12 
Asia/Pacific73 33 23 1 (3)3,787 1 
Latin America87 47 44 3 (21)2,834 7 
Mining79 25 18 30 (6)2,879 96 
Power14 (1)6 — 5 650 — 
Total Segments777 276 224 176 (21)31,027 409 
Unallocated20 (131)95 — — 1,941 1 
Timing(4)— — — — 19 — 
Methodology— 60 (74)— — 211 — 
Inter-segment Eliminations (1)
— — — — — (176)— 
Total$793 $205 $245 $176 $(21)$33,022 $410 
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$370 $134 $58 $127 $10 $15,229 $248 
EAME68 5 11 14 16 5,067 42 
Asia/Pacific71 34 19 2 3 3,921 1 
Latin America71 15 35 2 6 2,636 16 
Mining74 25 10 36 (8)2,700 25 
Power11 8 2 — (4)704 — 
Total Segments665 221 135 181 23 30,257 332 
Unallocated6 (70)43 — — 1,628 2 
Timing(3)2 — — — 18 — 
Methodology— 46 (58)— — 278 — 
Inter-segment Eliminations (1)
— — — — — (224)— 
Total$668 $199 $120 $181 $23 $31,957 $334 
 (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)


 
2023
External
Revenues		Profit
before
income
taxes		Interest
Expense		Depreciation
on equipment
leased to
others		Provision
for
credit
losses		Assets at
June 30, 2023		Capital
expenditures
North America$854 $303 $203 $250 $7 $15,777 $515 
EAME172 44 46 29 2 5,100 36 
Asia/Pacific143 67 46 2 (4)3,787 2 
Latin America169 66 84 6 (15)2,834 10 
Mining167 59 33 62 (7)2,879 119 
Power28 4 12 1 5 650 — 
Total Segments1,533 543 424 350 (12)31,027 682 
Unallocated35 (241)171 — — 1,941 6 
Timing(7)— — — — 19 — 
Methodology— 107 (133)— — 211 — 
Inter-segment Eliminations (1)
— — — — — (176)— 
Total$1,561 $409 $462 $350 $(12)$33,022 $688 
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$729 $261 $112 $255 $16 $15,229 $447 
EAME135 5 18 28 42 5,067 56 
Asia/Pacific146 71 36 3 4 3,921 3 
Latin America129 34 61 4 5 2,636 18 
Mining146 45 18 74 (10)2,700 47 
Power30 23 5 1 (7)704 — 
Total Segments1,315 439 250 365 50 30,257 571 
Unallocated11 (142)85 — — 1,628 4 
Timing(6)3 — — — 18 — 
Methodology— 92 (109)— — 278 — 
Inter-segment Eliminations (1)
— — — — — (224)— 
Total$1,320 $392 $226 $365 $50 $31,957 $575 
 (1) Elimination is primarily related to intercompany loans