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Revenue
 6 Months Ended
Jun. 30, 2023
Revenue from Contract with Customer [Abstract]  
Revenue
7.
Revenue

Disaggregation of Revenue

The following table disaggregates the Company’s revenue by major geographic and market segment destination. In the table, North America includes the U.S. and Canada (in millions):

 

 

 

 

Three Months Ended June 30,

 

 

 

2023

 

 

2022

 

 

 

 

 

 

Completion

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Completion

 

 

 

 

 

 

 

 

 

 

 

 

Wellbore

 

 

& Production

 

 

Rig

 

 

 

 

 

 

 

 

Wellbore

 

 

& Production

 

 

Rig

 

 

 

 

 

 

 

 

 

Technologies

 

 

Solutions

 

 

Technologies

 

 

Elims.

 

 

Total

 

 

Technologies

 

 

Solutions

 

 

Technologies

 

 

Elims.

 

 

Total

 

North America

 

$

408

 

 

$

327

 

 

$

110

 

 

$

—

 

 

$

845

 

 

$

346

 

 

$

236

 

 

$

120

 

 

$

—

 

 

$

702

 

International

 

 

363

 

 

 

402

 

 

 

483

 

 

 

—

 

 

 

1,248

 

 

 

305

 

 

 

391

 

 

 

329

 

 

 

—

 

 

 

1,025

 

Eliminations

 

 

33

 

 

 

24

 

 

 

13

 

 

 

(70

)

 

 

—

 

 

 

15

 

 

 

12

 

 

 

13

 

 

 

(40

)

 

 

—

 

 

$

804

 

 

$

753

 

 

$

606

 

 

$

(70

)

 

$

2,093

 

 

$

666

 

 

$

639

 

 

$

462

 

 

$

(40

)

 

$

1,727

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Land

 

$

577

 

 

$

459

 

 

$

136

 

 

$

—

 

 

$

1,172

 

 

$

518

 

 

$

387

 

 

$

115

 

 

$

—

 

 

$

1,020

 

Offshore

 

 

194

 

 

 

270

 

 

 

457

 

 

 

—

 

 

 

921

 

 

 

133

 

 

 

240

 

 

 

334

 

 

 

—

 

 

 

707

 

Eliminations

 

 

33

 

 

 

24

 

 

 

13

 

 

 

(70

)

 

 

—

 

 

 

15

 

 

 

12

 

 

 

13

 

 

 

(40

)

 

 

—

 

 

$

804

 

 

$

753

 

 

$

606

 

 

$

(70

)

 

$

2,093

 

 

$

666

 

 

$

639

 

 

$

462

 

 

$

(40

)

 

$

1,727

 

 

 

 

Six Months Ended June 30,

 

 

 

2023

 

 

2022

 

 

 

 

 

 

Completion

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Completion

 

 

 

 

 

 

 

 

 

 

 

 

Wellbore

 

 

& Production

 

 

Rig

 

 

 

 

 

 

 

 

Wellbore

 

 

& Production

 

 

Rig

 

 

 

 

 

 

 

 

 

Technologies

 

 

Solutions

 

 

Technologies

 

 

Elims.

 

 

Total

 

 

Technologies

 

 

Solutions

 

 

Technologies

 

 

Elims.

 

 

Total

 

North America

 

$

791

 

 

$

654

 

 

$

214

 

 

$

—

 

 

$

1,659

 

 

$

652

 

 

$

449

 

 

$

208

 

 

$

—

 

 

$

1,309

 

International

 

 

706

 

 

 

774

 

 

 

916

 

 

 

—

 

 

 

2,396

 

 

 

595

 

 

 

699

 

 

 

672

 

 

 

—

 

 

 

1,966

 

Eliminations

 

 

52

 

 

 

43

 

 

 

26

 

 

 

(121

)

 

 

—

 

 

 

27

 

 

 

21

 

 

 

23

 

 

 

(71

)

 

 

—

 

 

$

1,549

 

 

$

1,471

 

 

$

1,156

 

 

$

(121

)

 

$

4,055

 

 

$

1,274

 

 

$

1,169

 

 

$

903

 

 

$

(71

)

 

$

3,275

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Land

 

$

1,130

 

 

$

897

 

 

$

327

 

 

$

—

 

 

$

2,354

 

 

$

952

 

 

$

709

 

 

$

238

 

 

$

—

 

 

$

1,899

 

Offshore

 

 

367

 

 

 

531

 

 

 

803

 

 

 

—

 

 

 

1,701

 

 

 

295

 

 

 

439

 

 

 

642

 

 

 

—

 

 

 

1,376

 

Eliminations

 

 

52

 

 

 

43

 

 

 

26

 

 

 

(121

)

 

 

—

 

 

 

27

 

 

 

21

 

 

 

23

 

 

 

(71

)

 

 

—

 

 

$

1,549

 

 

$

1,471

 

 

$

1,156

 

 

$

(121

)

 

$

4,055

 

 

$

1,274

 

 

$

1,169

 

 

$

903

 

 

$

(71

)

 

$

3,275

 

 

Performance Obligations

Net revenue recognized from performance obligations satisfied in previous periods was $5 million for the three months ended June 30, 2023 primarily due to change orders.

Remaining performance obligations represent the transaction price of firm orders for all revenue streams for which work has not been performed on contracts with original expected duration of one year or more. We do not disclose the remaining performance obligations of royalty contracts, service contracts for which there is a right to invoice, and short-term contracts that are expected to have a duration of one year or less. As of June 30, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $4,210 million. The Company expects to recognize approximately $761 million in revenue for the remaining performance obligations in 2023 and $3,449 million in 2024 and thereafter.

 

Contract Assets and Liabilities

Contract assets include unbilled amounts when revenue recognized exceeds the amount billed to the customer under contracts where revenue is recognized over time. Contract liabilities consist of customer billings in excess of revenue recognized under over-time contracts, customer advance payments and deferred revenue.

The changes in the carrying amount of contract assets and contract liabilities are as follows (in millions):

 

 

 

Contract
Assets

 

 

Contract
Liabilities

 

Balance at December 31, 2022

 

$

685

 

 

$

444

 

Provision

 

 

—

 

 

 

—

 

Billings

 

 

(668

)

 

 

548

 

Revenue recognized

 

 

655

 

 

 

(514

)

Currency translation adjustments and other

 

 

32

 

 

 

16

 

Balance at June 30, 2023

 

$

704

 

 

$

494

 

 

 

Royalty Revenue

 

The Company recognizes royalty revenue due under various licenses for the Company's intellectual property, including for technology related to drill bits. The Company recognized revenue for drill bit licenses of approximately $21 million and $41 million for the three and six months ended June 30, 2023, respectively, and $20 million and $40 million for the three and six months ended June 30, 2022, respectively. As previously disclosed, the Company is currently pursuing litigation against certain non-paying licensees. See Note 15 for discussion of the ongoing litigation.

Allowance for Credit Losses

The Company estimates its allowance for credit losses using information about past events, current conditions and risk characteristics of each customer, and reasonable and supportable forecasts relevant to assessing risk associated with the collectability of receivables and contract assets. The Company’s customer base, mostly in the oil and gas industry, have generally similar collectability risk characteristics, although larger and state-owned customers may have lower risk than smaller independent customers. As of June 30, 2023, the allowance for credit losses totaled $76 million.

 

The changes in the carrying amount of the allowance for credit losses are as follows (in millions):

 

Balance at December 31, 2022

 

$

71

 

Provision for expected credit losses

 

 

16

 

Recoveries collected

 

 

(7

)

Other

 

 

(4

)

Balance at June 30, 2023

 

$

76