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Segment and Geographic Area Information | 12 Months Ended
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Dec. 31, 2024
Segment Reporting [Abstract] |
Segment and Geographic Area Information | Segment and Geographic Area Information Howmet is a global leader in lightweight metals engineering and manufacturing. Howmet’s innovative, multi-material products, which include nickel, titanium, aluminum, and cobalt, are used worldwide in the aerospace (commercial and defense), commercial transportation, and industrial and other markets. Segment performance under Howmet’s management reporting system is evaluated based on Segment Adjusted EBITDA. The Company’s Chief Executive Officer, who has been determined to be our Chief Operating Decision Maker (“CODM”), believes that Segment Adjusted EBITDA provides information with respect to the Company’s operating performance and the Company’s ability to meet its financial obligations. Howmet’s definition of Segment Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development (“R&D”) expenses; and Provision for depreciation and amortization. Special items, including Restructuring and other charges, are excluded from net margin and Segment Adjusted EBITDA. The Company’s CODM considers forecast-to-actual variances for Segment Adjusted EBITDA when allocating resources across the Company’s reportable segments. Segment Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Differences between the total segment and consolidated totals are in Corporate. Howmet’s operations consist of four worldwide reportable segments as follows: Engine Products Engine Products produces investment castings, including airfoils, and seamless rolled rings primarily for aircraft engines and industrial gas turbine applications. Engine Products produces rotating parts as well as structural parts. Fastening Systems Fastening Systems produces aerospace fastening systems, as well as commercial transportation, industrial and other fasteners. The business’s high-tech, multi-material fastening systems are found nose to tail on aircraft and aero engines. Fastening Systems’ products are also critical components of commercial transportation vehicles, and construction, industrial, and renewable energy equipment. Engineered Structures Engineered Structures produces titanium ingots and mill products for aerospace and defense applications and is vertically integrated to produce titanium forgings, titanium extrusions, and machining services for airframe, wing, aero-engine, and landing gear components. Engineered Structures also produces aluminum forgings, nickel forgings, and aluminum machined components and assemblies for aerospace and defense applications. Forged Wheels Forged Wheels provides forged aluminum wheels and related products for heavy-duty trucks and the commercial transportation market. The operating results and assets of the Company's reportable segments were as follows:
Year ended | Engine Products |  | Fastening Systems |  | Engineered Structures |  | Forged Wheels |  | Total Segment
2024 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 3,735 |  |  | $ | 1,576 |  |  | $ | 1,065 |  |  | $ | 1,054 |  |  | $ | 7,430 |
Inter-segment sales | 7 |  |  | 1 |  |  | 10 |  |  | — |  |  | 18 |
Total sales | $ | 3,742 |  |  | $ | 1,577 |  |  | $ | 1,075 |  |  | $ | 1,054 |  |  | $ | 7,448 |
Expenses: |  |  |  |  |  |  |  |  |
Segment Adjusted cost of goods sold(1) | $ | 2,495 |  |  | $ | 1,061 |  |  | $ | 873 |  |  | $ | 724 |  |  | $ | 5,153 |
Other segment items(2) | 97 |  |  | 110 |  |  | 36 |  |  | 43 |  |  | 286 |
Profit and loss: |  |  |  |  |  |  |  |  |
Segment Adjusted EBITDA | $ | 1,150 |  |  | $ | 406 |  |  | $ | 166 |  |  | $ | 287 |  |  | $ | 2,009 |
Restructuring and other charges | 1 |  |  | 5 |  |  | 12 |  |  | 1 |  |  | 19 |
Provision for depreciation and amortization | 139 |  |  | 47 |  |  | 42 |  |  | 42 |  |  | 270 |
Other: |  |  |  |  |  |  |  |  |
Capital expenditures | $ | 219 |  |  | $ | 26 |  |  | $ | 20 |  |  | $ | 45 |  |  | $ | 310 |
Total assets | 5,145 |  |  | 2,711 |  |  | 1,355 |  |  | 701 |  |  | 9,912 |
2023 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 3,266 |  |  | $ | 1,349 |  |  | $ | 878 |  |  | $ | 1,147 |  |  | $ | 6,640 |
Inter-segment sales | 13 |  |  | — |  |  | 3 |  |  | — |  |  | 16 |
Total sales | $ | 3,279 |  |  | $ | 1,349 |  |  | $ | 881 |  |  | $ | 1,147 |  |  | $ | 6,656 |
Expenses: |  |  |  |  |  |  |  |  |
Segment Adjusted cost of goods sold(1) | $ | 2,295 |  |  | $ | 959 |  |  | $ | 720 |  |  | $ | 796 |  |  | $ | 4,770 |
Other segment items(2) | 97 |  |  | 112 |  |  | 48 |  |  | 42 |  |  | 299 |
Profit and loss: |  |  |  |  |  |  |  |  |
Segment Adjusted EBITDA | $ | 887 |  |  | $ | 278 |  |  | $ | 113 |  |  | $ | 309 |  |  | $ | 1,587 |
Restructuring and other (credits) charges | (2) |  |  | 1 |  |  | 21 |  |  | — |  |  | 20 |
Provision for depreciation and amortization | 130 |  |  | 46 |  |  | 47 |  |  | 39 |  |  | 262 |
Other: |  |  |  |  |  |  |  |  |
Capital expenditures | $ | 112 |  |  | $ | 31 |  |  | $ | 26 |  |  | $ | 36 |  |  | $ | 205 |
Total assets | 4,926 |  |  | 2,749 |  |  | 1,415 |  |  | 724 |  |  | 9,814 |
2022 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 2,698 |  |  | $ | 1,117 |  |  | $ | 790 |  |  | $ | 1,058 |  |  | $ | 5,663 |
Inter-segment sales | 4 |  |  | — |  |  | 6 |  |  | — |  |  | 10 |
Total sales | $ | 2,702 |  |  | $ | 1,117 |  |  | $ | 796 |  |  | $ | 1,058 |  |  | $ | 5,673 |
Expenses: |  |  |  |  |  |  |  |  |
Segment Adjusted cost of goods sold(1) | $ | 1,881 |  |  | $ | 782 |  |  | $ | 644 |  |  | $ | 745 |  |  | $ | 4,052 |
Other segment items(2) | 92 |  |  | 101 |  |  | 41 |  |  | 35 |  |  | 269 |
Profit and loss: |  |  |  |  |  |  |  |  |
Segment Adjusted EBITDA | $ | 729 |  |  | $ | 234 |  |  | $ | 111 |  |  | $ | 278 |  |  | $ | 1,352 |
Restructuring and other charges | 29 |  |  | 8 |  |  | 7 |  |  | 2 |  |  | 46 |
Provision for depreciation and amortization | 125 |  |  | 45 |  |  | 48 |  |  | 40 |  |  | 258 |
Other: |  |  |  |  |  |  |  |  |
Capital expenditures | $ | 94 |  |  | $ | 39 |  |  | $ | 17 |  |  | $ | 28 |  |  | $ | 178 |
Total assets | 4,784 |  |  | 2,661 |  |  | 1,273 |  |  | 701 |  |  | 9,419 |
(1) Segment Adjusted cost of goods sold is exclusive of Provision for depreciation and amortization, Restructuring and other charges, and Corporate expenses. (2) Other segment items includes Selling, general administrative, and other expenses, and Research and development expenses; exclusive of Provision for depreciation and amortization, and Restructuring and other charges. The following table reconciles Total segment capital expenditures, which are presented on an accrual basis, with Capital expenditures as presented on the Statement of Consolidated Cash Flows. Differences between the total segment and consolidated totals are in Corporate, including the impact of changes in accrued capital expenditures during the period.
For the year ended December 31, | 2024 |  | 2023 |  | 2022
Total segment capital expenditures | $ | 310 |  |  | $ | 205 |  |  | $ | 178 |
Corporate | 11 |  |  | 14 |  |  | 15 |
Capital expenditures | $ | 321 |  |  | $ | 219 |  |  | $ | 193 |
The following tables reconcile certain segment information to consolidated totals. Differences between the total segment and consolidated totals are in Corporate.
For the year ended December 31, | 2024 |  | 2023 |  | 2022
Total Segment Adjusted EBITDA | $ | 2,009 |  |  | $ | 1,587 |  |  | $ | 1,352 |
Segment provision for depreciation and amortization | (270) |  |  | (262) |  |  | (258) |
Unallocated amounts: |  |  |  |  |
Restructuring and other charges (D) | (21) |  |  | (23) |  |  | (56) |
Corporate expense | (85) |  |  | (99) |  |  | (119) |
Operating income | $ | 1,633 |  |  | $ | 1,203 |  |  | $ | 919 |
Loss on debt redemption | (6) |  |  | (2) |  |  | (2) |
Interest expense, net | (182) |  |  | (218) |  |  | (229) |
Other expense, net (F) | (62) |  |  | (8) |  |  | (82) |
Income before income taxes | $ | 1,383 |  |  | $ | 975 |  |  | $ | 606 |
December 31, | 2024 |  | 2023
Assets: |  |  |
Total segment assets | $ | 9,912 |  |  | $ | 9,814 |
Unallocated amounts: |  |  |
Cash and cash equivalents | 564 |  |  | 610 |
Deferred income taxes | 36 |  |  | 46 |
Corporate fixed assets, net | 83 |  |  | 83 |
Fair value of derivative contracts | 4 |  |  | — |
Accounts receivable securitization | (250) |  |  | (250) |
Other | 170 |  |  | 125 |
Consolidated assets | $ | 10,519 |  |  | $ | 10,428 |
Segment assets include third-party receivables while the accounts receivable securitization item includes the impact of sold receivables under the Company’s Accounts Receivable securitization programs. See Note L for further details. Geographic information for sales was as follows (based upon the destination of the sale):
For the year ended December 31, | 2024 |  | 2023 |  | 2022
Sales: |  |  |  |  |
United States | $ | 3,713 |  |  | $ | 3,273 |  |  | $ | 2,928 |
France | 678 |  |  | 578 |  |  | 394 |
Germany | 458 |  |  | 363 |  |  | 292 |
Japan | 355 |  |  | 378 |  |  | 319 |
United Kingdom | 350 |  |  | 283 |  |  | 228 |
Italy | 287 |  |  | 220 |  |  | 180 |
Mexico | 220 |  |  | 263 |  |  | 235 |
Canada | 174 |  |  | 145 |  |  | 138 |
Poland | 152 |  |  | 130 |  |  | 96 |
China | 103 |  |  | 98 |  |  | 111 |
Other | 940 |  |  | 909 |  |  | 742 |
| $ | 7,430 |  |  | $ | 6,640 |  |  | $ | 5,663 |
Geographic information for long-lived tangible assets was as follows (based upon the physical location of the assets):
December 31, | 2024 |  | 2023
Long-lived assets: |  |  |
United States | $ | 1,864 |  |  | $ | 1,760 |
Hungary | 199 |  |  | 200 |
United Kingdom | 121 |  |  | 120 |
France | 112 |  |  | 121 |
Mexico | 68 |  |  | 71 |
Germany | 54 |  |  | 58 |
China | 41 |  |  | 46 |
Other | 82 |  |  | 80 |
| $ | 2,541 |  |  | $ | 2,456 |
The following table disaggregates segment revenue by major market served. Differences between the total segment and consolidated totals are in Corporate.
| Engine Products |  | Fastening Systems |  | Engineered Structures |  | Forged Wheels |  | Total Segment
Year ended December 31, 2024 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 2,091 |  |  | $ | 1,006 |  |  | $ | 774 |  |  | $ | — |  |  | $ | 3,871 |
Aerospace - Defense | 766 |  |  | 162 |  |  | 236 |  |  | — |  |  | 1,164 |
Commercial Transportation | — |  |  | 254 |  |  | — |  |  | 1,054 |  |  | 1,308 |
Industrial and Other | 878 |  |  | 154 |  |  | 55 |  |  | — |  |  | 1,087 |
Total end-market revenue | $ | 3,735 |  |  | $ | 1,576 |  |  | $ | 1,065 |  |  | $ | 1,054 |  |  | $ | 7,430 |
Year ended December 31, 2023 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 1,798 |  |  | $ | 790 |  |  | $ | 641 |  |  | $ | — |  |  | $ | 3,229 |
Aerospace - Defense | 670 |  |  | 173 |  |  | 172 |  |  | — |  |  | 1,015 |
Commercial Transportation | — |  |  | 255 |  |  | — |  |  | 1,147 |  |  | 1,402 |
Industrial and Other | 798 |  |  | 131 |  |  | 65 |  |  | — |  |  | 994 |
Total end-market revenue | $ | 3,266 |  |  | $ | 1,349 |  |  | $ | 878 |  |  | $ | 1,147 |  |  | $ | 6,640 |
Year ended December 31, 2022 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 1,495 |  |  | $ | 616 |  |  | $ | 495 |  |  | $ | — |  |  | $ | 2,606 |
Aerospace - Defense | 526 |  |  | 158 |  |  | 239 |  |  | — |  |  | 923 |
Commercial Transportation | — |  |  | 225 |  |  | — |  |  | 1,058 |  |  | 1,283 |
Industrial and Other | 677 |  |  | 118 |  |  | 56 |  |  | — |  |  | 851 |
Total end-market revenue | $ | 2,698 |  |  | $ | 1,117 |  |  | $ | 790 |  |  | $ | 1,058 |  |  | $ | 5,663 |
The Company derived 68%, 64%, and 62% of its revenue from the aerospace (commercial and defense) markets for the years ended December 31, 2024, 2023, and 2022, respectively. On April 2, 2024, General Electric Company, one of our largest customers, completed the spin-off of its energy-focused business into GE Vernova, a new publicly traded company. Since then, General Electric Company operates as GE Aerospace. RTX Corporation and GE Aerospace each represented approximately 10% of the Company’s third-party sales for the year ended December 31, 2024. These sales were primarily from the Engine Products segment.

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