Segment Information

3 Months Ended

Jun. 30, 2024

Segment Reporting [Abstract]

Segment Information

Note 13 – Segment Information

Financial information for our reportable operating segments, which includes allocated corporate expenses, is summarized as follows:

	Three months ended June 30, 2024
	Finance		Voluntary protection		Intercompany
	operations		operations		eliminations			Total
Total financing revenues	$	3,209	$	-	$	-		$	3,209
Depreciation on operating leases		1,034		-		-			1,034
Interest expense		1,443		-		-			1,443
Net financing revenues		732		-		-			732
Voluntary protection contract revenues   and insurance earned premiums		-		295		-			295
Investment and other income, net		166		57		-			223
Net financing and other revenues		898		352		-			1,250
Expenses:
Provision for credit losses		189		-		-			189
Operating and administrative		327		113		-			440
Voluntary protection contract expenses and insurance losses		-		159		-			159
Total expenses		516		272		-			788
Income before income taxes		382		80		-			462
Provision for income taxes		87		18		-			105
Net income	$	295	$	62	$	-		$	357
Total assets at June 30, 2024	$	141,145	$	7,635	$	(142	)	$	148,638

	Three months ended June 30, 2023
	Finance		Voluntary protection		Intercompany
	operations		operations		eliminations			Total
Total financing revenues	$	2,904	$	-	$	-		$	2,904
Depreciation on operating leases		1,155		-		-			1,155
Interest expense		899		-		-			899
Net financing revenues		850		-		-			850
Voluntary protection contract revenues   and insurance earned premiums		-		271		-			271
Investment and other income, net		114		48		-			162
Net financing and other revenues		964		319		-			1,283
Expenses:
Provision for credit losses		165		-		-			165
Operating and administrative		334		114		-			448
Voluntary protection contract expenses and insurance losses		-		146		-			146
Total expenses		499		260		-			759
Income before income taxes		465		59		-			524
Provision for income taxes		119		13		-			132
Net income	$	346	$	46	$	-		$	392
Total assets at June 30, 2023	$	131,974	$	6,729	$	(67	)	$	138,636

Note 13 – Segment Information (Continued)

Voluntary protection operations – Contract revenues

For the three months ended June 30, 2024 and 2023, approximately 85 percent and 84 percent, respectively, of voluntary protection contract revenues in the Voluntary protection operations segment were accounted for under the guidance for revenue from contracts with customers.

The Voluntary protection operations segment defers contractually determined incentives paid to dealers as contract costs for selling voluntary protection products. These costs are recorded in Other assets on our Consolidated Balance Sheets and are amortized to Operating and administrative expenses in the Consolidated Statements of Income using a methodology consistent with the recognition of revenue. The amount of capitalized dealer incentives and the related amortization was not significant to our consolidated financial statements as of and for the three months ended June 30, 2024 and 2023.

We had $3.1 billion and $2.9 billion of unearned voluntary protection contract revenues from contracts with customers included in Other liabilities on our Consolidated Balance Sheets as of March 31, 2024 and March 31, 2023, respectively. We recognized $232 million of these balances in voluntary protection contract revenues in our Consolidated Statements of Income during the three months ended June 30, 2024, compared to $209 million recognized during the same period in fiscal 2024. As of June 30, 2024, we had unearned voluntary protection contract revenues of $3.2 billion included in Other liabilities on our Consolidated Balance Sheets, and with respect to this balance we expect to recognize revenue of $717 million during fiscal 2025, and $2.5 billion thereafter. At June 30, 2023, we had unearned voluntary protection contract revenues of $3.0 billion associated with outstanding contracts.