Revenue from Contracts With Customers

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer

Revenue from Contracts with Customers

5.     Revenue from Contracts with Customers

Disaggregation of Sales

The company disaggregates net sales by reportable segments as disclosed in Note 3, and based on the timing of transfer of control for goods and services as explained below. The transfer of control for goods and services may occur at a point in time or over time.

The following table disaggregates the company’s net sales based on the timing of transfer of control:

	Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	Point in Time		Over Time		Total		Point in Time		Over Time		Total
2021	$	603	$	2,950	$	3,553	$	1,837	$	8,300	$	10,137
2020		604		2,489		3,093		1,638		7,041		8,679

Contract Balances

The company did not have any contract assets at either September 30, 2021, or December 31, 2020. Unbilled receivables, which are not classified as contract assets, represent arrangements in which sales have been recorded prior to billing and right to payment is unconditional.

The opening and closing balances of the company’s current and noncurrent contract liabilities are as follows:

	Contract		Contract
	Liabilities		Liabilities
($ in millions)	(Current)		(Noncurrent)
Balance at December 31, 2020	$	108	$	29
Increase (decrease)		118		6
Balance at September 30, 2021	$	226	$	35

During the nine months ended September 30, 2021, total contract liabilities increased by $124 million, which is net of cash received of $503 million and amounts recognized as sales of $379 million, the majority of which related to current contract liabilities. The amount of sales recognized in the nine months ended September 30, 2021, which were included in the opening contract liabilities balances, was $108 million, all of which related to current contract liabilities. Current contract liabilities are classified within other current liabilities on the unaudited condensed consolidated balance sheet and noncurrent contract liabilities are classified within other liabilities.

The company also recognized net sales of $7 million and $9 million in the three months ended September 30, 2021 and 2020, respectively, and net sales of $18 million and $12 million in the nine months ended September 30, 2021 and 2020, respectively, from performance obligations satisfied (or partially satisfied) in prior periods. These sales amounts are the result of changes in the transaction price of the company’s contracts with customers.

Transaction Price Allocated to Remaining Performance Obligations

The table below discloses: (1) the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied (or partially unsatisfied) as of the end of the reporting period for contracts with an original duration of greater than one year, and (2) when the company expects to record sales on these multi-year contracts.

($ in millions)	Next Twelve Months		Thereafter		Total
Sales expected to be recognized on multi-year contracts in place as of September 30, 2021	$	1,398	$	1,290	$	2,688