XML 24 R11.htm IDEA: XBRL DOCUMENT v3.20.4
REVENUE RECOGNITION
 3 Months Ended
Jan. 31, 2021
REVENUE RECOGNITION  
REVENUE RECOGNITION

(4)  Revenue Recognition

The Company’s revenue by primary geographical market, major product line, and timing of revenue recognition in millions of dollars follow:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended January 31, 2021

​

​

​

Production & Precision Ag

​

Small Ag & Turf

​

Construction & Forestry

​

Financial Services

​

Total

​

Primary geographical markets:

​

​

​

​

​

​

 

​

​

 

​

             

 

​

            

​

United States

​

$

1,608

​

$

1,424

​

$

1,202

​

$

598

​

$

4,832

​

Canada

​

​

112

​

​

79

​

​

188

​

 

154

​

 

533

​

Western Europe

​

​

449

​

​

486

​

​

439

​

 

24

​

 

1,398

​

Central Europe and CIS

​

​

161

​

​

84

​

​

178

​

 

9

​

 

432

​

Latin America

​

​

513

​

​

77

​

​

170

​

 

59

​

 

819

​

Asia, Africa, Australia, New Zealand, and Middle East

​

​

304

​

​

401

​

​

353

​

​

40

​

​

1,098

​

Total

​

$

3,147

​

$

2,551

​

$

2,530

​

$

884

​

$

9,112

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Major product lines:

​

​

​

​

​

​

​

​

​

​

​

             

​

​

            

​

Production Agriculture

​

$

3,011

​

​

​

​

​

​

​

​

​

​

$

3,011

​

Small Agriculture

​

​

​

​

$

1,812

​

​

​

​

 

​

​

 

1,812

​

Turf

​

​

​

​

​

651

​

​

​

​

 

​

​

 

651

​

Construction

​

​

​

​

​

​

​

$

887

​

 

​

​

 

887

​

Compact Construction

​

​

​

​

​

​

​

​

346

​

​

​

​

​

346

​

Roadbuilding

​

​

​

​

​

​

​

​

910

​

 

​

​

 

910

​

Forestry

​

​

​

​

​

​

​

​

290

​

 

​

​

 

290

​

Financial Products

​

​

16

​

​

10

​

​

7

​

$

884

​

 

917

​

Other

​

​

120

​

​

78

​

​

90

​

 

​

​

 

288

​

Total

​

$

3,147

​

$

2,551

​

$

2,530

​

$

884

​

$

9,112

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Timing of revenue recognition:

​

​

​

​

​

​

​

​

​

​

​

             

​

​

            

​

Revenue recognized at a point in time

​

$

3,105

​

$

2,535

​

$

2,500

​

$

24

​

$

8,164

​

Revenue recognized over time

​

​

42

​

​

16

​

​

30

​

​

860

​

​

948

​

Total

​

$

3,147

​

$

2,551

​

$

2,530

​

$

884

​

$

9,112

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended February 2, 2020

​

​

​

Production & Precision Ag

​

Small Ag & Turf

​

Construction & Forestry

​

Financial Services

​

Total

​

Primary geographical markets:

 

​

​

 

​

​

 

​

​

 

​

             

 

​

             

​

United States

​

$

1,433

​

$

1,067

​

$

1,020

​

$

643

​

$

4,163

​

Canada

​

​

75

​

​

63

​

​

172

​

 

156

​

 

466

​

Western Europe

​

​

365

​

​

413

​

​

339

​

 

22

​

 

1,139

​

Central Europe and CIS

​

​

131

​

​

89

​

​

159

​

 

10

​

 

389

​

Latin America

​

​

383

​

​

72

​

​

159

​

 

66

​

 

680

​

Asia, Africa, Australia, New Zealand, and Middle East

​

​

189

​

​

315

​

​

256

​

​

34

​

​

794

​

Total

​

$

2,576

​

$

2,019

​

$

2,105

​

$

931

​

$

7,631

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Major product lines:

​

​

​

​

​

​

​

​

​

​

​

             

​

​

             

​

Production Agriculture

​

$

2,425

​

​

​

​

​

​

​

​

​

​

$

2,425

​

Small Agriculture

​

​

​

​

$

1,479

​

​

​

​

 

​

​

 

1,479

​

Turf

​

​

​

​

​

468

​

​

​

​

 

​

​

 

468

​

Construction

​

​

​

​

​

​

​

$

841

​

 

​

​

 

841

​

Compact Construction

​

​

​

​

​

​

​

​

288

​

​

​

​

​

288

​

Roadbuilding

​

​

​

​

​

​

​

​

605

​

 

​

​

 

605

​

Forestry

​

​

​

​

​

​

​

​

274

​

 

​

​

 

274

​

Financial Products

​

​

18

​

​

9

​

​

7

​

$

931

​

 

965

​

Other

​

​

133

​

​

63

​

​

90

​

 

​

​

 

286

​

Total

​

$

2,576

​

$

2,019

​

$

2,105

​

$

931

​

$

7,631

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Timing of revenue recognition:

​

​

​

​

​

​

​

​

​

​

​

             

​

​

             

​

Revenue recognized at a point in time

​

$

2,536

​

$

2,004

​

$

2,079

​

$

26

​

$

6,645

​

Revenue recognized over time

​

​

40

​

​

15

​

​

26

​

​

905

​

​

986

​

Total

​

$

2,576

​

$

2,019

​

$

2,105

​

$

931

​

$

7,631

​

​

The Company’s major product lines are described as follows:

Production Agriculture – Includes net sales of large and certain mid-size tractors and associated attachments, combines, cotton pickers, cotton strippers, and sugarcane harvesters, sugarcane loaders and pull behind scrapers, tillage, seeding, and application equipment, including sprayers, nutrient management and soil preparation machinery, and related attachments and service parts.

Small Agriculture – Includes net sales of mid-size and utility tractors, self-propelled forage harvesters, hay and forage equipment, balers, mowers, and related attachments and service parts.

Turf – Includes net sales of turf and utility equipment, including riding lawn equipment, golf course equipment, utility vehicles, and commercial mowing equipment, along with a broad line of associated implements, other outdoor power products, and related service parts.

Construction – Includes net sales of a broad range of machines used in construction, earthmoving, and material handling, including backhoe loaders, crawler dozers and loaders, four-wheel-drive loaders, excavators, motor graders, articulated dump trucks, and related attachments and service parts.

Compact Construction – Includes net sales of smaller construction equipment, including compact excavators, compact track loaders, compact wheel loaders, skid steers, landscape loaders, and related attachments and service parts.

Roadbuilding – Includes net sales of equipment used in roadbuilding and renovation, including milling machines, recyclers, slipform pavers, surface miners, asphalt pavers, compactors, tandem and static rollers, mobile crushers and screens, mobile and stationary asphalt plants, and related attachments and service parts.

Forestry – Includes net sales of equipment used in timber harvesting, including log skidders, feller bunchers, log loaders, log forwarders, log harvesters, and related attachments and service parts.

Financial Products – Includes finance and interest income primarily from retail notes related to sales of John Deere equipment to end customers, wholesale financing to dealers of John Deere equipment, and revolving charge accounts; lease income from retail leases of John Deere equipment; and revenue from extended warranties.

Other – Includes sales of certain components to other equipment manufacturers, revenue earned over time from precision guidance, telematics, and other information enabled solutions, revenue from service performed at Company owned dealerships and service centers, gains on disposition of property and businesses, trademark licensing revenue, and other miscellaneous revenue items.

The Company invoices in advance of recognizing the sale of certain products and the revenue for certain services. These items are primarily for premiums for extended warranties, advance payments for future equipment sales, and subscription and service revenue related to precision guidance and telematic services. These advanced customer payments are presented as deferred revenue, a contract liability, in “Accounts payable and accrued expenses” in the consolidated balance sheet. The deferred revenue received, but not recognized in revenue, including extended warranty premiums also shown in Note 16, was $1,169 million, $1,090 million, and $1,070 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The contract liability is reduced as the revenue is recognized. During the three months ended January 31, 2021 and February 2, 2020, $223 million and $181 million, respectively, of revenue was recognized from deferred revenue that was recorded as a contract liability at the beginning of the respective fiscal year.

The Company entered into contracts with customers to deliver equipment and services that have not been recognized at January 31, 2021 because the equipment or services have not been provided. These contracts primarily relate to extended warranty and certain precision guidance and telematic services. The amount of unsatisfied performance obligations for contracts with an original duration greater than one year is $925 million at January 31, 2021. The estimated revenue to be recognized by fiscal year in millions of dollars follows: remainder of 2021 - $274, 2022 - $291, 2023 - $195, 2024 - $104, 2025 - $43, 2026 - $15 and later years - $3. The Company discloses unsatisfied performance obligations with an original contract duration greater than one year. The contracts with an expected duration of one year or less are generally for sales to dealers and end customers for equipment, service parts, repair services, and certain telematics services.

During 2020, the Company provided short-term payment relief on trade accounts and notes receivables to independent dealers and certain other customers that were negatively affected by the economic effects of COVID. The relief was provided both in regional programs and case-by-case situations with creditworthy

customers. This relief generally included payment deferrals not exceeding three months, extending interest-free periods for up to an additional three months with the total interest-free period not to exceed one year, or reducing interest rates for a maximum of three months. The trade receivable balance granted relief and remaining outstanding at January 31, 2021 was not material.