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SEGMENT INFORMATION | 12 Months Ended
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Oct. 31, 2021
Segment Reporting [Abstract] |
SEGMENT INFORMATION | SEGMENT INFORMATION Description of Segments. We are a global leader in life sciences, diagnostics and applied chemical markets, providing application focused solutions that include instruments, software, services and consumables for the entire laboratory workflow. Agilent has three business segments comprised of the life sciences and applied markets business, diagnostics and genomics business and the Agilent CrossLab business each of which comprises a reportable segment. The three operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Other factors, including market separation and customer specific applications, go-to-market channels, products and services and manufacturing are considered in determining the formation of these operating segments. A description of our three reportable segments is as follows: Our life sciences and applied markets business provides application-focused solutions that include instruments and software that enable customers to identify, quantify and analyze the physical and biological properties of substances and products, as well as enable customers in the clinical and life sciences research areas to interrogate samples at the molecular and cellular level. Key product categories include: liquid chromatography ("LC") systems and components; liquid chromatography mass spectrometry ("LCMS") systems; gas chromatography ("GC") systems and components; gas chromatography mass spectrometry ("GCMS") systems; inductively coupled plasma mass spectrometry ("ICP-MS") instruments; atomic absorption ("AA") instruments; microwave plasma-atomic emission spectrometry ("MP-AES") instruments; inductively coupled plasma optical emission spectrometry ("ICP-OES") instruments; raman spectroscopy; cell analysis plate based assays; flow cytometer; real-time cell analyzer; cell imaging systems; microplate reader; laboratory software for sample tracking; information management and analytics; laboratory automation and robotic systems; dissolution testing; vacuum pumps and measurement technologies. Our diagnostics and genomics business is comprised of six areas of activity providing active pharmaceutical ingredients ("APIs") for oligo-based therapeutics as well as solutions that include reagents, instruments, software and consumables, which enable customers in the clinical and life sciences research areas to interrogate samples at the cellular and molecular level. First, our genomics business includes arrays for DNA mutation detection, genotyping, gene copy number determination, identification of gene rearrangements, DNA methylation profiling, gene expression profiling, as well as next generation sequencing ("NGS") target enrichment and genetic data management and interpretation support software. This business also includes solutions that enable clinical labs to identify DNA variants associated with genetic disease and help direct cancer therapy. Second, our nucleic acid solutions business provides equipment and expertise focused on production of synthesized oligonucleotides under pharmaceutical good manufacturing practices ("GMP") conditions for use as API in an emerging class of drugs that utilize nucleic acid molecules for disease therapy. Third, our pathology solutions business is focused on product offerings for cancer diagnostics and anatomic pathology workflows. The broad portfolio of offerings includes immunohistochemistry ("IHC"), in situ hybridization ("ISH"), hematoxylin and eosin ("H&E") staining and special staining. Fourth, we also collaborate with a number of major pharmaceutical companies to develop new potential tissue and liquid-based pharmacodiagnostics, also known as companion diagnostics, which may be used to identify patients most likely to benefit from a specific targeted therapy. Fifth, the reagent partnership business is a provider of reagents used for turbidimetry and flow cytometry. Finally, our biomolecular analysis business provides complete workflow solutions, including instruments, consumables and software, for quality control analysis of nucleic acid samples. Samples are analyzed using quantitative and qualitative techniques to ensure accuracy in further genomics analysis techniques utilized in clinical and life science research applications. The Agilent CrossLab business spans the entire lab with its extensive consumables and services portfolio, which is designed to improve customer outcomes. Most of the portfolio is vendor neutral, meaning Agilent can serve and supply customers regardless of their instrument purchase choices. Solutions range from chemistries and supplies to services and software helping to connect the entire lab. Key product categories in consumables include GC and LC columns, sample preparation products, custom chemistries, and a large selection of laboratory instrument supplies. Services include startup, operational, training and compliance support, software as a service, as well as asset management and consultative services that help increase customer productivity. Custom service and consumable bundles are tailored to meet the specific application needs of various industries and to keep instruments fully operational and compliant with the respective industry requirements. A significant portion of the segments' expenses arise from shared services and infrastructure that we have historically provided to the segments in order to realize economies of scale and to efficiently use resources. These expenses, collectively called corporate charges, include legal, accounting, tax, real estate, insurance services, information technology services, treasury, order administration, other corporate infrastructure expenses and costs of centralized research and development. Charges are allocated to the segments, and the allocations have been determined on a basis that we consider to be a reasonable reflection of the utilization of services provided to or benefits received by the segments. In addition, we do not allocate asset impairments, amortization of acquisition-related intangible assets, change in the fair value of acquisition-related contingent considerations, acquisition and integration costs, restructuring and transformational initiatives expenses, acceleration of share-based compensation expense related to workforce reduction, business exit and divestiture costs, special compliance costs, some nucleic acid solutions division ("NASD") site costs and certain other charges to the operating margin for each segment because management does not include this information in its measurement of the performance of the operating segments. Transformational initiatives include expenses associated with targeted cost reduction activities such as manufacturing transfers, site consolidations, legal entity and other business reorganizations, in-sourcing or outsourcing of activities. The following tables reflect the results of our reportable segments under our management reporting system. The performance of each segment is measured based on several metrics, including segment income from operations. These results are used, in part, by the chief operating decision maker in evaluating the performance of, and in allocating resources to, each of the segments. The profitability of each of the segments is measured after excluding items such as asset impairment charges, transformational initiatives, acquisition and integration costs, non-cash amortization of intangible assets related to business combinations, interest income, interest expense, and other items as noted in the reconciliations below.
| Life Sciences and Applied Markets |  | Diagnostics and Genomics |  | Agilent CrossLab |  | Total Segments
| (in millions)
Year Ended October 31, 2021: |  |  |  |  |  |  |
Total net revenue | $ | 2,823 |  |  | $ | 1,296 |  |  | $ | 2,200 |  |  | $ | 6,319 |
Income from operations | $ | 722 |  |  | $ | 273 |  |  | $ | 618 |  |  | $ | 1,613 |
Depreciation expense | $ | 44 |  |  | $ | 39 |  |  | $ | 39 |  |  | $ | 122 |
Share-based compensation expense(1) | $ | 45 |  |  | $ | 22 |  |  | $ | 39 |  |  | $ | 106 |
Year Ended October 31, 2020: |  |  |  |  |  |  |
Total net revenue | $ | 2,392 |  |  | $ | 1,047 |  |  | $ | 1,900 |  |  | $ | 5,339 |
Income from operations | $ | 548 |  |  | $ | 192 |  |  | $ | 516 |  |  | $ | 1,256 |
Depreciation expense | $ | 43 |  |  | $ | 39 |  |  | $ | 37 |  |  | $ | 119 |
Share-based compensation expense (1) | $ | 35 |  |  | $ | 17 |  |  | $ | 29 |  |  | $ | 81 |
Year Ended October 31, 2019: |  |  |  |  |  |  |
Total net revenue | $ | 2,302 |  |  | $ | 1,021 |  |  | $ | 1,840 |  |  | $ | 5,163 |
Income from operations | $ | 542 |  |  | $ | 185 |  |  | $ | 475 |  |  | $ | 1,202 |
Depreciation expense | $ | 41 |  |  | $ | 35 |  |  | $ | 35 |  |  | $ | 111 |
Share-based compensation expense | $ | 33 |  |  | $ | 14 |  |  | $ | 25 |  |  | $ | 72 |
(1) Share-based compensation expense in 2020 and 2021 excludes amounts not allocated to the segments related to accelerated share-based compensation expense from workforce reduction and from our acquisition of BioTek and Resolution Bioscience. The following table reconciles reportable segments' income from operations to Agilent's total enterprise income before taxes:
| Years Ended October 31,
| 2021 |  | 2020 |  | 2019
| (in millions)
Total reportable segments' income from operations | $ | 1,613 |  |  | $ | 1,256 |  |  | $ | 1,202 |
Amortization of intangible assets related to business combinations | (194) |  |  | (184) |  |  | (125) |
Acquisition and integration costs | (41) |  |  | (41) |  |  | (48) |
Transformational initiatives | (37) |  |  | (53) |  |  | (44) |
Acceleration of share-based compensation expense related to workforce reduction | (1) |  |  | (2) |  |  | — |
Asset impairments | (2) |  |  | (99) |  |  | — |
Business exit and divestiture costs | (5) |  |  | (2) |  |  | — |
Change in fair value of contingent consideration | 21 |  |  | — |  |  | — |
NASD site costs | — |  |  | — |  |  | (12) |
Special compliance costs | (1) |  |  | — |  |  | (2) |
Other (1) | (6) |  |  | (29) |  |  | (30) |
Interest Income | 2 |  |  | 8 |  |  | 36 |
Interest Expense | (81) |  |  | (78) |  |  | (74) |
Other income (expense), net (2) | 92 |  |  | 66 |  |  | 16 |
Income before taxes, as reported | $ | 1,360 |  |  | $ | 842 |  |  | $ | 919 |
(1) For the years ended October 31, 2020 and 2019, the other category primarily includes legal costs related to a claim we pursued against Twist Bioscience Corporation in addition to other miscellaneous adjustments. (2) For the year ended October 31, 2021, other income (expense), net includes net gains on the fair value of equity securities. For the year ended October 31, 2020, other income (expense), net includes the settlement of a legal claim against Twist Bioscience Corporation. Major Customers. No customer represented 10 percent or more of our total net revenue in 2021, 2020 or 2019. The following table reflects segment assets and capital expenditures under our management reporting system. Segment assets include allocations of corporate assets, goodwill, net other intangibles and other assets. Unallocated assets primarily consist of cash, cash equivalents, short-term and long-term investments, deferred tax assets, right-of use assets and other assets.
| Life Sciences and Applied Markets |  | Diagnostics and Genomics |  | Agilent CrossLab |  | Total Segments
| (in millions)
As of and for the Year Ended October 31, 2021: |  |  |  |  |  |  |
Assets | $ | 3,078 |  |  | $ | 3,320 |  |  | $ | 1,502 |  |  | $ | 7,900 |
Capital expenditures | $ | 45 |  |  | $ | 100 |  |  | $ | 43 |  |  | $ | 188 |
As of and for the Year Ended October 31, 2020: |  |  |  |  |  |  |
Assets | $ | 3,143 |  |  | $ | 2,515 |  |  | $ | 1,375 |  |  | $ | 7,033 |
Capital expenditures | $ | 44 |  |  | $ | 34 |  |  | $ | 41 |  |  | $ | 119 |
The following table reconciles segment assets to Agilent's total assets:
| October 31,
| 2021 |  | 2020
| (in millions)
Total reportable segments' assets | $ | 7,900 |  |  | $ | 7,033 |
Cash and cash equivalents | 1,484 |  |  | 1,441 |
Short-term investments | 91 |  |  | — |
Prepaid expenses | 91 |  |  | 106 |
Long-term investments | 185 |  |  | 158 |
Long-term and other receivables | 126 |  |  | 114 |
Deferred tax assets | 309 |  |  | 380 |
Right of use assets | 178 |  |  | 175 |
Other | 341 |  |  | 220 |
Total assets | $ | 10,705 |  |  | $ | 9,627 |
The other category primarily includes overfunded pension plans which are not allocated to the segments. The following table presents summarized information for net revenue by geographic region. Revenues from external customers are generally attributed to countries based upon the customers' location.
| United States |  | China(1) |  |  |  | Rest of the World |  | Total
| (in millions)
Net revenue: |  |  |  |  |  |  |  |  |
Year Ended October 31, 2021 | $ | 2,159 |  |  | $ | 1,273 |  |  |  |  | $ | 2,887 |  |  | $ | 6,319 |
Year Ended October 31, 2020 | $ | 1,752 |  |  | $ | 1,087 |  |  |  |  | $ | 2,500 |  |  | $ | 5,339 |
Year Ended October 31, 2019 | $ | 1,619 |  |  | $ | 1,019 |  |  |  |  | $ | 2,525 |  |  | $ | 5,163 |
1. China also includes Hong Kong net revenue. The following table presents summarized information for long-lived assets by geographic region. Long lived assets consist of property, plant, and equipment, right-of-use assets, long-term receivables and other long-term assets excluding intangible assets. The rest of the world primarily consists of Asia and the rest of Europe.
| United States |  |  |  | Germany |  | Rest of the World |  | Total
| (in millions)
Long-lived assets: |  |  |  |  |  |  |  |  |
October 31, 2021 | $ | 912 |  |  |  |  | $ | 134 |  |  | $ | 587 |  |  | $ | 1,633 |
October 31, 2020 | $ | 727 |  |  |  |  | $ | 126 |  |  | $ | 538 |  |  | $ | 1,391 |

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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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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