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Segment Reporting | 9 Months Ended
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Sep. 30, 2018
Segment Reporting [Abstract] |
Segment Reporting | SEGMENT REPORTING Aptiv operates its core business along the following operating segments, which are grouped on the basis of similar product, market and operating factors:
• | Signal and Power Solutions, which includes complete electrical architecture and component products.
• | Advanced Safety and User Experience, which includes component and systems integration expertise in infotainment and connectivity, body controls and security systems, displays and active and passive safety electronics, autonomous driving software and technologies, as well as advanced development of software.
• | Eliminations and Other, which includes i) the elimination of inter-segment transactions, and ii) certain other expenses and income of a non-operating or strategic nature.
The accounting policies of the segments are the same as those described in Note 2. Significant Accounting Policies, except that the disaggregated financial results for the segments have been prepared using a management approach, which is consistent with the basis and manner in which management internally disaggregates financial information for which Aptiv’s chief operating decision maker regularly reviews financial results to assess performance of, and make internal operating decisions about allocating resources to, the segments. Generally, Aptiv evaluates segment performance based on stand-alone segment net income before interest expense, other income (expense), net, income tax expense, equity income (loss), net of tax, income (loss) from discontinued operations, net of tax, restructuring, other acquisition and portfolio project costs (which includes costs incurred to integrate acquired businesses and to plan and execute product portfolio transformation actions, including business and product acquisitions and divestitures), asset impairments, gains (losses) on business divestitures and deferred compensation related to acquisitions (“Adjusted Operating Income”) and accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, at current market prices. Aptiv’s management utilizes Adjusted Operating Income as the key performance measure of segment income or loss to evaluate segment performance, and for planning and forecasting purposes to allocate resources to the segments, as management believes this measure is most reflective of the operational profitability or loss of Aptiv’s operating segments. Segment Adjusted Operating Income should not be considered a substitute for results prepared in accordance with U.S. GAAP and should not be considered an alternative to net income attributable to Aptiv, which is the most directly comparable financial measure to Adjusted Operating Income that is prepared in accordance with U.S. GAAP. Segment Adjusted Operating Income, as determined and measured by Aptiv, should also not be compared to similarly titled measures reported by other companies. As described in Note 21. Discontinued Operations, the Company’s previously reported Powertrain Systems segment has been classified as discontinued operations for all periods presented. Certain original equipment service businesses that were previously included within the Powertrain Systems segment but which were not included in the spin-off, are reported in continuing operations and have been reclassified within the Advanced Safety and User Experience and Signal and Power Solutions segments for all periods presented. No amounts for shared general and administrative operating expense or interest expense were allocated to discontinued operations. Included below are sales and operating data for Aptiv’s segments for the three and nine months ended September 30, 2018 and 2017.
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other (1) |  | Total
| (in millions)
For the Three Months Ended September 30, 2018: |  |  |  |  |  |  |
Net sales | $ | 2,535 |  |  | $ | 956 |  |  | $ | (6 | ) |  | $ | 3,485 |
Depreciation & amortization | $ | 124 |  |  | $ | 39 |  |  | $ | — |  |  | $ | 163 |
Adjusted operating income | $ | 346 |  |  | $ | 74 |  |  | $ | — |  |  | $ | 420 |
Operating income | $ | 277 |  |  | $ | 46 |  |  | $ | — |  |  | $ | 323 |
Equity income, net of tax | $ | 4 |  |  | $ | — |  |  | $ | — |  |  | $ | 4 |
Net income attributable to noncontrolling interest | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | 9 |
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other (1) |  | Total
| (in millions)
For the Three Months Ended September 30, 2017: |  |  |  |  |  |  |
Net sales | $ | 2,318 |  |  | $ | 846 |  |  | $ | (16 | ) |  | $ | 3,148 |
Depreciation & amortization | $ | 109 |  |  | $ | 27 |  |  | $ | — |  |  | $ | 136 |
Adjusted operating income | $ | 319 |  |  | $ | 75 |  |  | $ | — |  |  | $ | 394 |
Operating income | $ | 300 |  |  | $ | 73 |  |  | $ | — |  |  | $ | 373 |
Equity income, net of tax | $ | 6 |  |  | $ | — |  |  | $ | — |  |  | $ | 6 |
Net income attributable to noncontrolling interest | $ | 9 |  |  | $ | — |  |  | $ | — |  |  | $ | 9 |
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other (1) |  | Total
| (in millions)
For the Nine Months Ended September 30, 2018: |  |  |  |  |  |  |
Net sales | $ | 7,802 |  |  | $ | 3,032 |  |  | $ | (35 | ) |  | $ | 10,799 |
Depreciation & amortization | $ | 361 |  |  | $ | 113 |  |  | $ | — |  |  | $ | 474 |
Adjusted operating income | $ | 1,083 |  |  | $ | 238 |  |  | $ | — |  |  | $ | 1,321 |
Operating income | $ | 956 |  |  | $ | 162 |  |  | $ | — |  |  | $ | 1,118 |
Equity income, net of tax | $ | 17 |  |  | $ | — |  |  | $ | — |  |  | $ | 17 |
Net income attributable to noncontrolling interest | $ | 30 |  |  | $ | — |  |  | $ | — |  |  | $ | 30 |
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other (1) |  | Total
| (in millions)
For the Nine Months Ended September 30, 2017: |  |  |  |  |  |  |
Net sales | $ | 7,006 |  |  | $ | 2,490 |  |  | $ | (52 | ) |  | $ | 9,444 |
Depreciation & amortization | $ | 316 |  |  | $ | 76 |  |  | $ | — |  |  | $ | 392 |
Adjusted operating income | $ | 940 |  |  | $ | 204 |  |  | $ | — |  |  | $ | 1,144 |
Operating income | $ | 887 |  |  | $ | 143 |  |  | $ | — |  |  | $ | 1,030 |
Equity income, net of tax | $ | 24 |  |  | $ | — |  |  | $ | — |  |  | $ | 24 |
Net income attributable to noncontrolling interest | $ | 27 |  |  | $ | — |  |  | $ | — |  |  | $ | 27 |
(1) | Eliminations and Other includes the elimination of inter-segment transactions.
The reconciliation of Adjusted Operating Income to operating income includes, as applicable, restructuring, other acquisition and portfolio project costs (which includes costs incurred to integrate acquired businesses and to plan and execute product portfolio transformation actions, including business and product acquisitions and divestitures), asset impairments, gains (losses) on business divestitures and deferred compensation related to acquisitions. The reconciliations of Adjusted Operating Income to net income attributable to Aptiv for the three and nine months ended September 30, 2018 and 2017 are as follows:
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other |  | Total
| (in millions)
For the Three Months Ended September 30, 2018: |  |  |  |  |  |  |
Adjusted operating income | $ | 346 |  |  | $ | 74 |  |  | $ | — |  |  | $ | 420 |
Restructuring | (58 | ) |  | (7 | ) |  | — |  |  | (65 | )
Other acquisition and portfolio project costs | (11 | ) |  | (5 | ) |  | — |  |  | (16 | )
Asset impairments | — |  |  | (1 | ) |  | — |  |  | (1 | )
Deferred compensation related to nuTonomy acquisition | — |  |  | (15 | ) |  | — |  |  | (15 | )
Operating income | $ | 277 |  |  | $ | 46 |  |  | $ | — |  |  | 323 |
Interest expense |  |  |  |  |  |  | (34 | )
Other income, net |  |  |  |  |  |  | 4 |
Income from continuing operations before income taxes and equity income |  |  |  |  |  |  | 293 |
Income tax expense |  |  |  |  |  |  | (66 | )
Equity income, net of tax |  |  |  |  |  |  | 4 |
Income from continuing operations |  |  |  |  |  |  | 231 |
Income from discontinued operations, net of tax |  |  |  |  |  |  | — |
Net income |  |  |  |  |  |  | 231 |
Net income attributable to noncontrolling interest |  |  |  |  |  |  | 9 |
Net income attributable to Aptiv |  |  |  |  |  |  | $ | 222 |
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other |  | Total
| (in millions)
For the Three Months Ended September 30, 2017: |  |  |  |  |  |  |
Adjusted operating income | $ | 319 |  |  | $ | 75 |  |  | $ | — |  |  | $ | 394 |
Restructuring | (17 | ) |  | (1 | ) |  | — |  |  | (18 | )
Other acquisition and portfolio project costs | (1 | ) |  | (1 | ) |  | — |  |  | (2 | )
Asset impairments | (1 | ) |  | — |  |  | — |  |  | (1 | )
Operating income | $ | 300 |  |  | $ | 73 |  |  | $ | — |  |  | 373 |
Interest expense |  |  |  |  |  |  | (35 | )
Other expense, net |  |  |  |  |  |  | (7 | )
Income from continuing operations before income taxes and equity income |  |  |  |  |  |  | 331 |
Income tax expense |  |  |  |  |  |  | (31 | )
Equity income, net of tax |  |  |  |  |  |  | 6 |
Income from continuing operations |  |  |  |  |  |  | 306 |
Income from discontinued operations, net of tax |  |  |  |  |  |  | 107 |
Net income |  |  |  |  |  |  | 413 |
Net income attributable to noncontrolling interest |  |  |  |  |  |  | 18 |
Net income attributable to Aptiv |  |  |  |  |  |  | $ | 395 |
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other |  | Total
| (in millions)
For the Nine Months Ended September 30, 2018: |  |  |  |  |  |  |
Adjusted operating income | $ | 1,083 |  |  | $ | 238 |  |  | $ | — |  |  | $ | 1,321 |
Restructuring | (87 | ) |  | (13 | ) |  | — |  |  | (100 | )
Other acquisition and portfolio project costs | (39 | ) |  | (18 | ) |  | — |  |  | (57 | )
Asset impairments | (1 | ) |  | (1 | ) |  | — |  |  | (2 | )
Deferred compensation related to nuTonomy acquisition | — |  |  | (44 | ) |  | — |  |  | (44 | )
Operating income | $ | 956 |  |  | $ | 162 |  |  | $ | — |  |  | 1,118 |
Interest expense |  |  |  |  |  |  | (104 | )
Other income, net |  |  |  |  |  |  | 27 |
Income from continuing operations before income taxes and equity income |  |  |  |  |  |  | 1,041 |
Income tax expense |  |  |  |  |  |  | (208 | )
Equity income, net of tax |  |  |  |  |  |  | 17 |
Income from continuing operations |  |  |  |  |  |  | 850 |
Income from discontinued operations, net of tax |  |  |  |  |  |  | — |
Net income |  |  |  |  |  |  | 850 |
Net income attributable to noncontrolling interest |  |  |  |  |  |  | 30 |
Net income attributable to Aptiv |  |  |  |  |  |  | $ | 820 |
| Signal and Power Solutions |  | Advanced Safety and User Experience |  | Eliminations and Other |  | Total
| (in millions)
For the Nine Months Ended September 30, 2017: |  |  |  |  |  |  |
Adjusted operating income | $ | 940 |  |  | $ | 204 |  |  | $ | — |  |  | $ | 1,144 |
Restructuring | (44 | ) |  | (57 | ) |  | — |  |  | (101 | )
Other acquisition and portfolio project costs | (8 | ) |  | (3 | ) |  | — |  |  | (11 | )
Asset impairments | (1 | ) |  | (1 | ) |  | — |  |  | (2 | )
Operating income | $ | 887 |  |  | $ | 143 |  |  | $ | — |  |  | 1,030 |
Interest expense |  |  |  |  |  |  | (103 | )
Other expense, net |  |  |  |  |  |  | (22 | )
Income from continuing operations before income taxes and equity income |  |  |  |  |  |  | 905 |
Income tax expense |  |  |  |  |  |  | (88 | )
Equity income, net of tax |  |  |  |  |  |  | 24 |
Income from continuing operations |  |  |  |  |  |  | 841 |
Income from discontinued operations, net of tax |  |  |  |  |  |  | 310 |
Net income |  |  |  |  |  |  | 1,151 |
Net income attributable to noncontrolling interest |  |  |  |  |  |  | 52 |
Net income attributable to Aptiv |  |  |  |  |  |  | $ | 1,099 |

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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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