Revenue from Contracts With Customers

3 Months Ended

Mar. 31, 2023

Revenue from Contracts with Customers

Revenue from Contracts with Customers

5.     Revenue from Contracts with Customers

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

	($ in millions)
Three Months Ended March 31,	Point in Time		Over Time		Total
2023	$	544	$	2,945	$	3,489
2022		601		3,115		3,716

Contract Balances

The company did not have any contract assets at either March 31, 2023, or December 31, 2022. 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, 2022	$	316	$	12
Increase (decrease)		(12)		48
Balance at March 31, 2023	$	304	$	60

During the three months ended March 31, 2023, contract liabilities increased by $36 million, which is net of cash received of $258 million and amounts recognized as sales of $222 million, the majority of which related to current contract liabilities. The amount of sales recognized in the three months ended March 31, 2023, that was included in the opening contract liabilities balance, was $222 million, all of which related to current contract liabilities. Current contract liabilities are classified within other current liabilities on the unaudited condensed consolidated balance sheets and noncurrent contract liabilities are classified within other liabilities.

The company also recognized net sales of $16 million and $9 million in the three months ended March 31, 2023, and 2022, 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 March 31, 2023	$	1,370	$	1,317	$	2,687