Revenue from Contracts With Customers

9 Months Ended

Sep. 30, 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:

	Three Months Ended September 30,						Nine Months Ended September 30,
($ in millions)	Point in Time		Over Time		Total		Point in Time		Over Time		Total
2023	$	632	$	2,939	$	3,571	$	1,736	$	8,890	$	10,626
2022		725		3,226		3,951		2,031		9,770		11,801

Contract Balances

The company did not have any contract assets at either September 30, 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)		(9)		(3)
Balance at September 30, 2023	$	307	$	9

During the nine months ended September 30, 2023, contract liabilities decreased by $12 million, which is net of cash received of $734 million and amounts recognized as sales of $746 million, the majority of which related to current contract liabilities. The amount of sales recognized in the nine months ended September 30, 2023, that was included in the opening contract liabilities balance, was $316 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 recorded additional net sales of $2 million and $17 million in the three and nine months ended September 30, 2023, respectively, and a reduction in net sales of $5 million and no impact in the three and nine months ended September 30, 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 September 30, 2023	$	1,378	$	1,473	$	2,851