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Segment Financial Data | 9 Months Ended
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Sep. 30, 2020
Segment Reporting [Abstract] |
Segment Reporting Disclosure [Text Block] | Segment Financial DataOur operations, effective as of the date of the Raytheon Merger, are classified into four principal segments: Collins Aerospace, Pratt & Whitney, RIS and RMD. The segments are generally based on the management structure of the businesses and the grouping of similar operating companies, where each management organization has general operating autonomy over diversified products and services. The results of RIS and RMD reflect the period subsequent to the completion of the Raytheon Merger on April 3, 2020. See “Note 21: Segment Financial Data” within the Notes to the Consolidated Financial Statements in our 2019 Annual Report for a description of the Collins Aerospace and Pratt & Whitney segments. Raytheon Intelligence & Space is a leading developer and provider of integrated sensor and communication systems for advanced missions, including space-enabled information and multi-domain intelligence solutions, as well as electronic warfare solutions, advanced training and logistic services, and cyber and software solutions to intelligence, defense, federal and commercial customers worldwide. Raytheon Missiles & Defense is a leading designer, developer, integrator and producer of missile and combat systems for the armed forces of the U.S. and allied nations and a leader in integrated air and missile defense, large land- and sea-based radar solutions, command, control, communications, computers, cyber and intelligence solutions, naval combat and ship electronic and sensing systems, and undersea sensing and effects solutions. In conjunction with the Raytheon Merger, we revised our measurement of segment performance to reflect how management now reviews and evaluates operating performance. Under the new segment performance measurement, certain acquisition accounting adjustments are now excluded from segments’ results in order to better represent the ongoing operational performance of those segments. In addition, the majority of Corporate expenses are now allocated to the segments, excluding certain items that remain at Corporate because they are not included in management’s review of the segments’ results. Historical results, discussion and presentation of our business segments reflect the impact of these adjustments for all periods presented. Also as a result of the Raytheon Merger, we now present a FAS/CAS operating adjustment outside of segment results, which represents the difference between our service cost component of our pension and PRB expense under the Financial Accounting Standards (FAS) requirements of U.S. GAAP and our pension and PRB expense under U.S. government Cost Accounting Standards (CAS) primarily related to our RIS and RMD segments. Because the Collins Aerospace and Pratt & Whitney segments generally record pension and PRB expense on a FAS basis, historical results were not impacted by this change in segment reporting. Total sales and operating profit by segment include inter-segment sales which are generally recorded at prices approximating those that the selling entity is able to obtain on external sales for our Collins Aerospace and Pratt & Whitney segments, and at cost-plus a specified fee, which may differ from what the selling entity would be able to obtain on sales to external customers, for our RIS and RMD segments. Results for the quarters ended September 30, 2020 and 2019 are as follows:
| Net Sales |  |  |  | Operating Profits |  |  |  | Operating Profit Margins |  |
(dollars in millions) | 2020 |  | 2019 |  | 2020 |  | 2019 |  | 2020 |  | 2019
Collins Aerospace Systems | $ | 4,274 |  |  | $ | 6,495 |  |  | $ | 526 |  |  | $ | 1,259 |  |  | 12.3 | % |  | 19.4 | %
Pratt & Whitney | 3,494 |  |  | 5,285 |  |  | (615) |  |  | 520 |  |  | (17.6) | % |  | 9.8 | %
Raytheon Intelligence & Space | 3,674 |  |  | — |  |  | 348 |  |  | — |  |  | 9.5 | % |  | — | %
Raytheon Missiles & Defense | 3,794 |  |  | — |  |  | 453 |  |  | — |  |  | 11.9 | % |  | — | %
Total segment | 15,236 |  |  | 11,780 |  |  | 712 |  |  | 1,779 |  |  | 4.7 | % |  | 15.1 | %
Eliminations and other(1) | (489) |  |  | (407) |  |  | (51) |  |  | (46) |  |  |  |  |
Corporate expenses and other unallocated items (2) | — |  |  | — |  |  | (84) |  |  | (83) |  |  |  |  |
FAS/CAS operating adjustment | — |  |  | — |  |  | 380 |  |  | — |  |  |  |  |
Acquisition accounting adjustments | — |  |  | — |  |  | (523) |  |  | (220) |  |  |  |  |
Consolidated | $ | 14,747 |  |  | $ | 11,373 |  |  | $ | 434 |  |  | $ | 1,430 |  |  | 2.9 | % |  | 12.6 | %
(1) Includes the operating results of certain smaller non-reportable business segments, including Forcepoint, LLC, which was acquired as part of the Raytheon Merger. (2) The net expenses related to the U.S. Army’s Lower Tier Air and Missile Defense Sensor (LTAMDS) project of $45 million in the quarter ended September 30, 2020 are included in Corporate operating profit as they are not included in management’s evaluation of business segment results. No amounts were recorded in the quarter ended September 30, 2019. Results for the nine months ended September 30, 2020 and 2019 are as follows:
| Net Sales |  |  |  | Operating Profits |  |  |  | Operating Profit Margins |  |
(dollars in millions) | 2020 |  | 2019 |  | 2020 |  | 2019 |  | 2020 |  | 2019
Collins Aerospace Systems | $ | 14,914 |  |  | $ | 19,584 |  |  | $ | 1,455 |  |  | $ | 3,499 |  |  | 9.8 | % |  | 17.9 | %
Pratt & Whitney | 12,334 |  |  | 15,257 |  |  | (597) |  |  | 1,447 |  |  | (4.8) | % |  | 9.5 | %
Raytheon Intelligence & Space | 6,988 |  |  | — |  |  | 659 |  |  | — |  |  | 9.4 | % |  | — | %
Raytheon Missiles & Defense | 7,384 |  |  | — |  |  | 850 |  |  | — |  |  | 11.5 | % |  | — | %
Total segment | 41,620 |  |  | 34,841 |  |  | 2,367 |  |  | 4,946 |  |  | 5.7 | % |  | 14.2 | %
Eliminations and other (1) | (1,452) |  |  | (1,186) |  |  | (104) |  |  | (115) |  |  |  |  |
Corporate expenses and other unallocated items (2) | — |  |  | — |  |  | (491) |  |  | (216) |  |  |  |  |
FAS/CAS operating adjustment | — |  |  | — |  |  | 736 |  |  | — |  |  |  |  |
Acquisition accounting adjustments | — |  |  | — |  |  | (4,539) |  |  | (657) |  |  |  |  |
Consolidated | $ | 40,168 |  |  | $ | 33,655 |  |  | $ | (2,031) |  |  | $ | 3,958 |  |  | (5.1) | % |  | 11.8 | %
(1) Includes the operating results of certain smaller non-reportable business segments, including Forcepoint, LLC, which was acquired as part of the Raytheon Merger. (2) The net expenses related to the U.S. Army’s LTAMDS project of $80 million in the nine months ended September 30, 2020 are included in Corporate operating profit as they are not included in management’s evaluation of business segment results. No amounts were recorded in the nine months ended September 30, 2019. Total assets by segment are as follows:
| Total Assets |  |
(dollars in millions) | September 30, 2020 |  | December 31, 2019
Collins Aerospace Systems(1) | $ | 68,870 |  |  | $ | 74,049 |
Pratt & Whitney(1) | 32,240 |  |  | 31,170 |
Raytheon Intelligence & Space(1) | 20,509 |  |  | — |
Raytheon Missiles & Defense(1) | 29,720 |  |  | — |
Total segment | 151,339 |  |  | 105,219 |
Corporate and other | 11,004 |  |  | 2,573 |
Assets related to discontinued operations | 56 |  |  | 31,823 |
Consolidated | $ | 162,399 |  |  | $ | 139,615 |
(1) Total assets include acquired intangible assets and property, plant and equipment fair value adjustment. Related amortization expense is included in Acquisition accounting adjustments. We disaggregate our contracts from customers by geographic location, by customer and by sales type. Our geographic location is based on customer location, utilizing end user customer location where known or practical. In instances in which determining the end user customer is not known or practical, we utilize ship to location as the customer location. In addition, for our RIS and RMD segments, we disaggregate our contracts from customers by contract type. We believe these categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Historical results have been recast to reflect the presentation of this disaggregation. Segment sales disaggregated by geographic region for the quarters ended September 30, 2020 and 2019 are as follows:
| 2020 |  |  |  |  |  |  | 2019 |  |  |  |  |
(dollars in millions) | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total |  | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total
United States | $ | 2,378 |  | $ | 1,856 |  | $ | 2,933 |  | $ | 2,290 |  | $ | 109 |  | $ | 9,566 |  |  | $ | 3,269 |  | $ | 2,260 |  | $ | — |  | $ | — |  | $ | 3 |  | $ | 5,532 |
Asia Pacific | 358 |  | 772 |  | 195 |  | 365 |  | 13 |  | 1,703 |  |  | 644 |  | 1,452 |  | — |  | — |  | — |  | 2,096 |
Middle East and North Africa | 97 |  | 112 |  | 122 |  | 714 |  | 10 |  | 1,055 |  |  | 168 |  | 212 |  | — |  | — |  | — |  | 380 |
Europe | 965 |  | 572 |  | 100 |  | 337 |  | 38 |  | 2,012 |  |  | 1,661 |  | 953 |  | — |  | — |  | — |  | 2,614 |
Canada and All Other | 165 |  | 179 |  | 29 |  | 29 |  | 9 |  | 411 |  |  | 342 |  | 409 |  | — |  | — |  | — |  | 751 |
Consolidated net sales | 3,963 |  | 3,491 |  | 3,379 |  | 3,735 |  | 179 |  | 14,747 |  |  | 6,084 |  | 5,286 |  | — |  | — |  | 3 |  | 11,373 |
Inter-segment sales | 311 |  | 3 |  | 295 |  | 59 |  | (668) |  | — |  |  | 411 |  | (1) |  | — |  | — |  | (410) |  | — |
Business segment sales | $ | 4,274 |  | $ | 3,494 |  | $ | 3,674 |  | $ | 3,794 |  | $ | (489) |  | $ | 14,747 |  |  | $ | 6,495 |  | $ | 5,285 |  | $ | — |  | $ | — |  | $ | (407) |  | $ | 11,373 |
Segment sales disaggregated by geographic region for the nine months ended September 30, 2020 and 2019 are as follows:
| 2020 |  |  |  |  |  |  | 2019 |  |  |  |  |
(dollars in millions) | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total |  | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total
United States | $ | 8,027 |  | $ | 6,103 |  | $ | 5,498 |  | $ | 4,440 |  | $ | 156 |  | $ | 24,224 |  |  | $ | 9,590 |  | $ | 6,353 |  | $ | — |  | $ | — |  | $ | 9 |  | $ | 15,952 |
Asia Pacific | 1,350 |  | 2,980 |  | 390 |  | 716 |  | 26 |  | 5,462 |  |  | 1,822 |  | 3,930 |  | — |  | — |  | — |  | 5,752 |
Middle East and North Africa | 339 |  | 406 |  | 244 |  | 1,434 |  | 18 |  | 2,441 |  |  | 536 |  | 608 |  | — |  | — |  | — |  | 1,144 |
Europe | 3,497 |  | 2,101 |  | 202 |  | 628 |  | 104 |  | 6,532 |  |  | 5,341 |  | 3,126 |  | — |  | — |  | — |  | 8,467 |
Canada and All Other | 651 |  | 738 |  | 53 |  | 43 |  | 24 |  | 1,509 |  |  | 1,097 |  | 1,243 |  | — |  | — |  | — |  | 2,340 |
Consolidated net sales | 13,864 |  | 12,328 |  | 6,387 |  | 7,261 |  | 328 |  | 40,168 |  |  | 18,386 |  | 15,260 |  | — |  | — |  | 9 |  | 33,655 |
Inter-segment sales | 1,050 |  | 6 |  | 601 |  | 123 |  | (1,780) |  | — |  |  | 1,198 |  | (3) |  | — |  | — |  | (1,195) |  | — |
Business segment sales | $ | 14,914 |  | $ | 12,334 |  | $ | 6,988 |  | $ | 7,384 |  | $ | (1,452) |  | $ | 40,168 |  |  | $ | 19,584 |  | $ | 15,257 |  | $ | — |  | $ | — |  | $ | (1,186) |  | $ | 33,655 |
Segment sales disaggregated by customer for the quarters ended September 30, 2020 and 2019 are as follows:
| 2020 |  |  |  |  |  |  | 2019 |  |  |  |  |
(dollars in millions) | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total |  | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total
U.S. government(1) | $ | 1,238 |  | $ | 1,270 |  | $ | 2,879 |  | $ | 2,288 |  | $ | 72 |  | $ | 7,747 |  |  | $ | 1,222 |  | $ | 1,091 |  | $ | — |  | $ | — |  | $ | — |  | $ | 2,313 |
Foreign military sales through the U.S. government | 34 |  | 325 |  | 185 |  | 828 |  | — |  | 1,372 |  |  | 64 |  | 335 |  | — |  | — |  | — |  | 399 |
Foreign government direct commercial sales | 230 |  | 120 |  | 240 |  | 594 |  | 2 |  | 1,186 |  |  | 217 |  | 98 |  | — |  | — |  | — |  | 315 |
Commercial aerospace and other commercial | 2,461 |  | 1,776 |  | 75 |  | 25 |  | 105 |  | 4,442 |  |  | 4,581 |  | 3,762 |  | — |  | — |  | 3 |  | 8,346 |
Consolidated net sales | 3,963 |  | 3,491 |  | 3,379 |  | 3,735 |  | 179 |  | 14,747 |  |  | 6,084 |  | 5,286 |  | — |  | — |  | 3 |  | 11,373 |
Inter-segment sales | 311 |  | 3 |  | 295 |  | 59 |  | (668) |  | — |  |  | 411 |  | (1) |  | — |  | — |  | (410) |  | — |
Business segment sales | $ | 4,274 |  | $ | 3,494 |  | $ | 3,674 |  | $ | 3,794 |  | $ | (489) |  | $ | 14,747 |  |  | $ | 6,495 |  | $ | 5,285 |  | $ | — |  | $ | — |  | $ | (407) |  | $ | 11,373 |
(1) Excludes foreign military sales through the U.S. government. Segment sales disaggregated by customer for the nine months ended September 30, 2020 and 2019 are as follows:
| 2020 |  |  |  |  |  |  | 2019 |  |  |  |  |
(dollars in millions) | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total |  | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total
U.S. government(1) | $ | 3,880 |  | $ | 3,792 |  | $ | 5,376 |  | $ | 4,429 |  | $ | 126 |  | $ | 17,603 |  |  | $ | 3,534 |  | $ | 3,243 |  | $ | — |  | $ | — |  | $ | — |  | $ | 6,777 |
Foreign military sales through the U.S. government | 166 |  | 877 |  | 387 |  | 1,610 |  | — |  | 3,040 |  |  | 190 |  | 901 |  | — |  | — |  | — |  | 1,091 |
Foreign government direct commercial sales | 659 |  | 380 |  | 449 |  | 1,163 |  | 2 |  | 2,653 |  |  | 700 |  | 382 |  | — |  | — |  | — |  | 1,082 |
Commercial aerospace and other commercial | 9,159 |  | 7,279 |  | 175 |  | 59 |  | 200 |  | 16,872 |  |  | 13,962 |  | 10,734 |  | — |  | — |  | 9 |  | 24,705 |
Consolidated net sales | 13,864 |  | 12,328 |  | 6,387 |  | 7,261 |  | 328 |  | 40,168 |  |  | 18,386 |  | 15,260 |  | — |  | — |  | 9 |  | 33,655 |
Inter-segment sales | 1,050 |  | 6 |  | 601 |  | 123 |  | (1,780) |  | — |  |  | 1,198 |  | (3) |  | — |  | — |  | (1,195) |  | — |
Business segment sales | $ | 14,914 |  | $ | 12,334 |  | $ | 6,988 |  | $ | 7,384 |  | $ | (1,452) |  | $ | 40,168 |  |  | $ | 19,584 |  | $ | 15,257 |  | $ | — |  | $ | — |  | $ | (1,186) |  | $ | 33,655 |
(1) Excludes foreign military sales through the U.S. government. Segment sales disaggregated by sales type for the quarters ended September 30, 2020 and 2019 are as follows:
| 2020 |  |  |  |  |  |  | 2019 |  |  |  |  |
(dollars in millions) | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total |  | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total
Product | $ | 3,231 |  | $ | 2,142 |  | $ | 2,534 |  | $ | 3,405 |  | $ | 157 |  | $ | 11,469 |  |  | $ | 4,973 |  | $ | 3,235 |  | $ | — |  | $ | — |  | $ | 3 |  | $ | 8,211 |
Service | 732 |  | 1,349 |  | 845 |  | 330 |  | 22 |  | 3,278 |  |  | 1,111 |  | 2,051 |  | — |  | — |  | — |  | 3,162 |
Consolidated net sales | $ | 3,963 |  | $ | 3,491 |  | $ | 3,379 |  | $ | 3,735 |  | $ | 179 |  | $ | 14,747 |  |  | $ | 6,084 |  | $ | 5,286 |  | $ | — |  | $ | — |  | $ | 3 |  | $ | 11,373 |
Inter-segment sales | 311 |  | 3 |  | 295 |  | 59 |  | (668) |  | — |  |  | 411 |  | (1) |  | — |  | — |  | (410) |  | — |
Business segment sales | $ | 4,274 |  | $ | 3,494 |  | $ | 3,674 |  | $ | 3,794 |  | $ | (489) |  | $ | 14,747 |  |  | $ | 6,495 |  | $ | 5,285 |  | $ | — |  | $ | — |  | $ | (407) |  | $ | 11,373 |
Segment sales disaggregated by sales type for the nine months ended September 30, 2020 and 2019 are as follows:
| 2020 |  |  |  |  |  |  | 2019 |  |  |  |  |
(dollars in millions) | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total |  | Collins Aerospace Systems | Pratt & Whitney | Raytheon Intelligence & Space | Raytheon Missiles & Defense | Other | Total
Product | $ | 11,325 |  | $ | 7,285 |  | $ | 4,867 |  | $ | 6,637 |  | $ | 288 |  | $ | 30,402 |  |  | $ | 15,105 |  | $ | 9,521 |  | $ | — |  | $ | — |  | $ | 9 |  | $ | 24,635 |
Service | 2,539 |  | 5,043 |  | 1,520 |  | 624 |  | 40 |  | 9,766 |  |  | 3,281 |  | 5,739 |  | — |  | — |  | — |  | 9,020 |
Consolidated net sales | $ | 13,864 |  | $ | 12,328 |  | $ | 6,387 |  | $ | 7,261 |  | $ | 328 |  | $ | 40,168 |  |  | $ | 18,386 |  | $ | 15,260 |  | $ | — |  | $ | — |  | $ | 9 |  | $ | 33,655 |
Inter-segment sales | 1,050 |  | 6 |  | 601 |  | 123 |  | (1,780) |  | — |  |  | 1,198 |  | (3) |  | — |  | — |  | (1,195) |  | — |
Business segment sales | $ | 14,914 |  | $ | 12,334 |  | $ | 6,988 |  | $ | 7,384 |  | $ | (1,452) |  | $ | 40,168 |  |  | $ | 19,584 |  | $ | 15,257 |  | $ | — |  | $ | — |  | $ | (1,186) |  | $ | 33,655 |
RIS and RMD segment sales disaggregated by contract type for the quarter and nine months ended September 30, 2020 are as follows:
| Quarter Ended September 30, 2020 |  |  |  | Nine Months Ended September 30, 2020 |  |
(dollars in millions) | Raytheon Intelligence & Space | Raytheon Missiles & Defense |  |  | Raytheon Intelligence & Space | Raytheon Missiles & Defense |
Fixed-price | $ | 1,443 |  | $ | 2,404 |  |  |  | $ | 2,646 |  | $ | 4,582 |  |
Cost-type | 1,936 |  | 1,331 |  |  |  | 3,741 |  | 2,679 |  |
Consolidated net sales | $ | 3,379 |  | $ | 3,735 |  |  |  | $ | 6,387 |  | $ | 7,261 |  |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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