Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 12, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | NOV | ||
Entity Registrant Name | NATIONAL OILWELL VARCO INC | ||
Entity Central Index Key | 1,021,860 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 375,800,956 | ||
Entity Public Float | $ 18.7 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 2,080 | $ 3,536 |
Receivables, net | 2,926 | 4,416 |
Inventories, net | 4,678 | 5,281 |
Costs in excess of billings | 1,250 | 1,878 |
Deferred income taxes | 376 | 447 |
Prepaid and other current assets | 491 | 604 |
Total current assets | 11,801 | 16,162 |
Property, plant and equipment, net | 3,124 | 3,362 |
Deferred income taxes | 488 | 503 |
Goodwill | 6,980 | 8,539 |
Intangibles, net | 3,849 | 4,444 |
Investment in unconsolidated affiliates | 327 | 362 |
Other assets | 156 | 190 |
Total assets | 26,725 | 33,562 |
Current liabilities: | ||
Accounts payable | 623 | 1,189 |
Accrued liabilities | 2,284 | 3,518 |
Billings in excess of costs | 785 | 1,775 |
Current portion of long-term debt and short-term borrowings | 2 | 152 |
Accrued income taxes | 264 | 431 |
Deferred income taxes | 291 | 309 |
Total current liabilities | 4,249 | 7,374 |
Long-term debt | 3,928 | 3,014 |
Deferred income taxes | 1,805 | 1,972 |
Other liabilities | 283 | 430 |
Total liabilities | $ 10,265 | $ 12,790 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock-par value $.01; 1 billion shares authorized; 375,764,794 and 418,977,608 shares issued and outstanding at December 31, 2015 and December 31, 2014 | $ 4 | $ 4 |
Additional paid-in capital | 8,005 | 8,341 |
Accumulated other comprehensive loss | (1,553) | (834) |
Retained earnings | 9,927 | 13,181 |
Total Company stockholders' equity | 16,383 | 20,692 |
Noncontrolling interests | 77 | 80 |
Total stockholders' equity | 16,460 | 20,772 |
Total liabilities and stockholders' equity | $ 26,725 | $ 33,562 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 375,764,794 | 418,977,608 |
Common stock, shares outstanding | 375,764,794 | 418,977,608 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenue | |||
Sales | $ 11,707 | $ 17,173 | $ 15,489 |
Services | 3,050 | 4,267 | 3,732 |
Total | 14,757 | 21,440 | 19,221 |
Cost of revenue | |||
Cost of sales | 9,362 | 12,407 | 11,107 |
Cost of services | 2,332 | 3,224 | 3,010 |
Total | 11,694 | 15,631 | 14,117 |
Gross profit | 3,063 | 5,809 | 5,104 |
Selling, general and administrative | 1,764 | 2,092 | 1,905 |
Goodwill and intangible asset impairment | 1,689 | 104 | |
Operating profit (loss) | (390) | 3,613 | 3,199 |
Interest and financial costs | (103) | (105) | (111) |
Interest income | 14 | 18 | 12 |
Equity income in unconsolidated affiliates | 13 | 58 | 63 |
Other income (expense), net | (123) | (90) | (39) |
Income (loss) from continuing operations before income taxes | (589) | 3,494 | 3,124 |
Provision for income taxes | 178 | 1,039 | 943 |
Income (loss) from continuing operations | (767) | 2,455 | 2,181 |
Income from discontinued operations | 52 | 147 | |
Net income (loss) | (767) | 2,507 | 2,328 |
Net income attributable to noncontrolling interests | 2 | 5 | 1 |
Net income (loss) attributable to Company | $ (769) | $ 2,502 | $ 2,327 |
Basic: | |||
Income (loss) from continuing operations | $ (1.99) | $ 5.73 | $ 5.11 |
Income from discontinued operations | 0.12 | 0.35 | |
Net income (loss) attributable to Company | (1.99) | 5.85 | 5.46 |
Diluted: | |||
Income (loss) from continuing operations | (1.99) | 5.70 | 5.09 |
Income from discontinued operations | 0.12 | 0.35 | |
Net income (loss) attributable to Company | (1.99) | 5.82 | 5.44 |
Cash dividends per share | $ 1.84 | $ 1.64 | $ 0.91 |
Weighted average shares outstanding: | |||
Basic | 387 | 428 | 426 |
Diluted | 387 | 430 | 428 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (767) | $ 2,507 | $ 2,328 |
Other comprehensive income (loss) (net of tax): | |||
Currency translation adjustments | (764) | (532) | (115) |
Derivative financial instruments | 23 | (233) | (37) |
Change in defined benefit plans | 22 | (65) | 41 |
Comprehensive income (loss) | (1,486) | 1,677 | 2,217 |
Net income attributable to noncontrolling interests | 2 | 5 | 1 |
Comprehensive income (loss) attributable to Company | $ (1,488) | $ 1,672 | $ 2,216 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Income (loss) from continuing operations | $ (767) | $ 2,455 | $ 2,181 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 747 | 778 | 738 |
Deferred income taxes | (258) | (300) | (336) |
Stock-based compensation | 109 | 101 | 92 |
Excess tax benefit from stock-based compensation | 1 | (15) | (20) |
Equity income in unconsolidated affiliates | (13) | (58) | (63) |
Dividend from unconsolidated affiliate | 34 | 73 | 66 |
Goodwill and intangible asset impairment | 1,689 | 104 | |
Other | 256 | 181 | 72 |
Change in operating assets and liabilities, net of acquisitions: | |||
Receivables | 1,091 | (153) | (516) |
Inventories | 410 | (710) | 238 |
Costs in excess of billings | 548 | (262) | (314) |
Prepaid and other current assets | 112 | (60) | 41 |
Accounts payable | (570) | 95 | 18 |
Accrued liabilities | (1,137) | 879 | 76 |
Billings in excess of costs | (686) | (59) | 582 |
Income taxes payable | (167) | (124) | 217 |
Other assets/liabilities, net | (67) | (400) | 8 |
Net cash provided by continuing operating activities | 1,332 | 2,525 | 3,080 |
Discontinued operations | 89 | 317 | |
Net cash provided by operating activities | 1,332 | 2,614 | 3,397 |
Cash flows from investing activities: | |||
Purchases of property, plant and equipment | (453) | (699) | (614) |
Business acquisitions, net of cash acquired | (86) | (291) | (2,397) |
Cash distributed in spin-off | (253) | ||
Other, net | 25 | 151 | 101 |
Net cash used in continuing investing activities | (514) | (1,092) | (2,910) |
Discontinued operations | (12) | (54) | |
Net cash used in investing activities | (514) | (1,104) | (2,964) |
Cash flows from financing activities: | |||
Borrowings against lines of credit and other debt | 11,377 | 173 | 2,609 |
Payments against lines of credit and other debt | (10,615) | (155) | (2,609) |
Cash dividends paid | (710) | (703) | (389) |
Share repurchases | (2,221) | (779) | |
Proceeds from stock options exercised | 7 | 108 | 58 |
Excess tax benefit from stock-based compensation | (1) | 15 | 20 |
Other | (2) | 7 | |
Net cash used in continuing financing activities | (2,163) | (1,343) | (304) |
Discontinued operations | (1) | ||
Net cash used in financing activities | (2,163) | (1,343) | (305) |
Effect of exchange rates on cash | (111) | (67) | (11) |
Increase (decrease) in cash and cash equivalents | (1,456) | 100 | 117 |
Cash and cash equivalents, beginning of period | 3,536 | 3,436 | 3,319 |
Cash and cash equivalents, end of period | 2,080 | 3,536 | 3,436 |
Cash payments during the period for: | |||
Interest | 103 | 102 | 111 |
Income taxes | $ 782 | $ 1,380 | $ 1,099 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Common Stock [Member] | Additional Paid in Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings (Loss) [Member] | Total Company Stockholders' Equity [Member] | Noncontrolling Interests [Member] |
Beginning Balance at Dec. 31, 2012 | $ 20,356 | $ 4 | $ 8,743 | $ 107 | $ 11,385 | $ 20,239 | $ 117 |
Beginning Balance, shares at Dec. 31, 2012 | 427 | ||||||
Net income (loss) | 2,328 | 2,327 | 2,327 | 1 | |||
Other comprehensive income (loss), net | (111) | (111) | (111) | ||||
Cash dividends, per common share | (389) | (389) | (389) | ||||
Dividends to noncontrolling interests | (3) | (3) | |||||
Noncontrolling interest contribution | 10 | 10 | |||||
Disposal of noncontrolling interest, net | (25) | (25) | |||||
Stock-based compensation | 92 | 92 | 92 | ||||
Common stock issued | 58 | 58 | 58 | ||||
Common stock issued, shares | 1 | ||||||
Withholding taxes | (6) | (6) | (6) | ||||
Excess tax benefit from stock-based compensation | 20 | 20 | 20 | ||||
Ending Balance at Dec. 31, 2013 | 22,330 | $ 4 | 8,907 | (4) | 13,323 | 22,230 | 100 |
Ending Balance, shares at Dec. 31, 2013 | 428 | ||||||
Net income (loss) | 2,507 | 2,502 | 2,502 | 5 | |||
Other comprehensive income (loss), net | (830) | (830) | (830) | ||||
Cash dividends, per common share | (703) | (703) | (703) | ||||
Dividends to noncontrolling interests | (20) | (20) | |||||
Noncontrolling interest contribution | 16 | 16 | |||||
Disposal of noncontrolling interest, net | (21) | (21) | |||||
Spin-off of distribution business | (1,941) | (1,941) | (1,941) | ||||
Stock-based compensation | 101 | 101 | 101 | ||||
Common stock issued | 108 | 108 | 108 | ||||
Common stock issued, shares | 3 | ||||||
Withholding taxes | (11) | (11) | (11) | ||||
Share repurchases, value | (779) | (779) | (779) | ||||
Share repurchases, shares | (12) | ||||||
Excess tax benefit from stock-based compensation | 15 | 15 | 15 | ||||
Ending Balance at Dec. 31, 2014 | 20,772 | $ 4 | 8,341 | (834) | 13,181 | 20,692 | 80 |
Ending Balance, shares at Dec. 31, 2014 | 419 | ||||||
Net income (loss) | (767) | (769) | (769) | 2 | |||
Other comprehensive income (loss), net | (719) | (719) | (719) | ||||
Cash dividends, per common share | (710) | (710) | (710) | ||||
Dividends to noncontrolling interests | (8) | (8) | |||||
Noncontrolling interest contribution | 3 | 3 | |||||
Stock-based compensation | 109 | 109 | 109 | ||||
Common stock issued | 7 | 7 | 7 | ||||
Common stock issued, shares | 1 | ||||||
Withholding taxes | (6) | (6) | (6) | ||||
Share repurchases, value | (2,221) | (446) | (1,775) | (2,221) | |||
Share repurchases, shares | (44) | ||||||
Excess tax benefit from stock-based compensation | 0 | ||||||
Ending Balance at Dec. 31, 2015 | $ 16,460 | $ 4 | $ 8,005 | $ (1,553) | $ 9,927 | $ 16,383 | $ 77 |
Ending Balance, shares at Dec. 31, 2015 | 376 |
Consolidated Statements of Sto8
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Retained Earnings (Loss) [Member] | |||
Cash dividends, per common share | $ 1.84 | $ 1.64 | $ 0.91 |
Organization and Basis of Prese
Organization and Basis of Presentation | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation Nature of Business We design, construct, manufacture and sell comprehensive systems, components, and products used in oil and gas drilling and production, provide oilfield services and supplies, and distribute products and provide supply chain integration services to the upstream oil and gas industry. Our revenues and operating results are directly related to the level of worldwide oil and gas drilling and production activities and the profitability and cash flow of oil and gas companies, drilling contractors and oilfield service companies, which in turn are affected by current and anticipated prices of oil and gas. Oil and gas prices have been, and are likely to continue to be, volatile. Basis of Consolidation The accompanying Consolidated Financial Statements include the accounts of National Oilwell Varco, Inc. and its consolidated subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Investments that are not wholly-owned, but where we exercise control, are fully consolidated with the equity held by minority owners and their portion of net income (loss) reflected as noncontrolling interests in the accompanying consolidated financial statements. Investments in unconsolidated affiliates, over which we exercise significant influence, but not control, are accounted for by the equity method. On May 30, 2014, the Company completed the spin-off of its distribution business into an independent public company named NOW Inc. In conjunction with the spin-off of NOW Inc. the Company reviewed its reporting and management structure, and effective April 1, 2014, reorganized the Rig Technology, Petroleum Services & Supplies and remaining operations of Distribution & Transmission reporting segments into four new reporting segments. The new reporting segments are Rig Systems, Rig Aftermarket, Wellbore Technologies and Completion & Production Solutions. As a result of the reorganization, all prior periods are presented on this basis. Results of operations related to NOW Inc. have been classified as discontinued operations in all periods presented on Form 10-K. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Fair Value of Financial Instruments The carrying amounts of financial instruments including cash and cash equivalents, receivables, and payables approximated fair value because of the relatively short maturity of these instruments. Cash equivalents include only those investments having a maturity date of three months or less at the time of purchase. Derivative Financial Instruments Accounting Standards Codification (“ASC”) Topic 815, “Derivatives and Hedging” (“ASC Topic 815”) requires companies to recognize all derivative instruments as either assets or liabilities in the Consolidated Balance Sheet at fair value. The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge, or a hedge of a net investment in a foreign operation. The Company records all derivative financial instruments at their fair value in its Consolidated Balance Sheet. Except for certain non-designated hedges discussed below, all derivative financial instruments that the Company holds are designated as cash flow hedges and are highly effective in offsetting movements in the underlying risks. Such arrangements typically have terms between two and 24 months, but may have longer terms depending on the underlying cash flows being hedged, typically related to the projects in our backlog. Inventories Inventories consist of raw materials, work-in-process and oilfield and industrial finished products, manufactured equipment and spare parts. Inventories are stated at the lower of cost or market using the first-in, first-out or average cost methods. Allowances for excess and obsolete inventories are determined based on our historical usage of inventory on-hand as well as our future expectations related to our installed base, the development of new products and consideration of current market conditions. The allowance, which totaled $500 million and $370 million at December 31, 2015 and 2014, respectively, is the amount necessary to reduce the cost of the inventory to its estimated net realizable value. Property, Plant and Equipment Property, plant and equipment are recorded at cost. Expenditures for major improvements that extend the lives of property and equipment are capitalized while minor replacements, maintenance and repairs are charged to operations as incurred. Disposals are removed at cost less accumulated depreciation with any resulting gain or loss reflected in operations. Depreciation is provided using the straight-line method over the estimated useful lives of individual items. Depreciation expense was $391 million, $413 million and $381 million for the years ended December 31, 2015, 2014 and 2013, respectively. The estimated useful lives of the major classes of property, plant and equipment are included in Note 6 to the consolidated financial statements. We record impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets are impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. The carrying value of assets used in operations that are not recoverable is reduced to fair value if lower than carrying value. In determining the fair market value of the assets, we consider market trends and recent transactions involving sales of similar assets, or when not available, discounted cash flow analysis. There have been no impairments of long-lived assets for the years ended December 31, 2015, 2014 and 2013. Intangible Assets The Company has approximately $7.0 billion of goodwill and $3.8 billion of identified intangible assets at December 31, 2015. Goodwill is identified by segment as follows (in millions): Rig Rig Wellbore Completion & Discontinued Total Balance at December 31, 2013 $ 1,279 $ 906 $ 4,425 $ 2,106 $ 333 $ 9,049 Goodwill acquired and adjusted during period — — 17 150 — 167 Goodwill disposed of during the period — — — (71 ) (332 ) (403 ) Currency translation adjustments and other (43 ) (29 ) (85 ) (116 ) (1 ) (274 ) Balance at December 31, 2014 $ 1,236 $ 877 $ 4,357 $ 2,069 $ — $ 8,539 Goodwill acquired and adjusted during period — — 8 (8 ) — — Impairment — — (1,485 ) — — (1,485 ) Currency translation adjustments and other (4 ) — (6 ) (64 ) — (74 ) Balance at December 31, 2015 $ 1,232 $ 877 $ 2,874 $ 1,997 $ — $ 6,980 Identified intangible assets with determinable lives consist primarily of customer relationships, trademarks, trade names, patents, and technical drawings acquired in acquisitions, and are being amortized on a straight-line basis over the estimated useful lives of 2-30 years. Amortization expense of identified intangibles is expected to be approximately $340 million in each of the next five years. Included in intangible assets are $384 million of indefinite-lived trade names. The net book values of identified intangible assets are identified by segment as follows (in millions): Rig Rig Wellbore Completion & Discontinued Total Balance at December 31, 2013 $ 232 $ 142 $ 2,999 $ 1,614 $ 68 $ 5,055 Additions to intangible assets — — 5 54 — 59 Disposal of intangible assets — — — (50 ) (67 ) (117 ) Asset impairment — — (104 ) — — (104 ) Amortization (22 ) (6 ) (218 ) (119 ) (1 ) (366 ) Currency translation adjustments and other (2 ) (3 ) (16 ) (62 ) — (83 ) Balance at December 31, 2014 $ 208 $ 133 $ 2,666 $ 1,437 $ — $ 4,444 Additions to intangible assets — — 2 57 — 59 Asset impairment (7 ) — (173 ) (24 ) — (204 ) Amortization (22 ) (6 ) (214 ) (114 ) — (356 ) Currency translation adjustments and other (3 ) (4 ) (27 ) (60 ) — (94 ) Balance at December 31, 2015 $ 176 $ 123 $ 2,254 $ 1,296 $ — $ 3,849 Identified intangible assets by major classification consist of the following (in millions): Gross Accumulated Net Book December 31, 2014: Customer relationships $ 4,094 $ (1,379 ) $ 2,715 Trademarks 871 (226 ) 645 Indefinite-lived trade names 536 — 536 Other 1,058 (510 ) 548 Total identified intangibles $ 6,559 $ (2,115 ) $ 4,444 December 31, 2015: Customer relationships $ 4,016 $ (1,630 ) $ 2,386 Trademarks 880 (265 ) 615 Indefinite-lived trade names 384 — 384 Other 1,040 (576 ) 464 Total identified intangibles $ 6,320 $ (2,471 ) $ 3,849 Asset Impairment Generally accepted accounting principles require the Company to test goodwill and other indefinite-lived intangible assets for impairment at least annually or more frequently whenever events or circumstances occur indicating that goodwill or other indefinite-lived intangible assets might be impaired. Events or circumstances which could indicate a potential impairment include (but are not limited to) a significant sustained reduction in worldwide oil and gas prices or drilling; a significant sustained reduction in profitability or cash flow of oil and gas companies or drilling contractors; a significant sustained reduction in capital investment by drilling companies and oil and gas companies; or a significant sustained increase in worldwide inventories of oil or gas. The discounted cash flow is based on management’s forecast of operating performance for each reporting unit. The two main assumptions used in measuring goodwill impairment, which bear the risk of change and could impact the Company’s goodwill impairment analysis, include the cash flow from operations from each of the Company’s individual business units and the weighted average cost of capital. The starting point for each of the reporting unit’s cash flow from operations is the detailed annual plan or updated forecast. The detailed planning and forecasting process takes into consideration a multitude of factors including worldwide rig activity, inflationary forces, pricing strategies, customer analysis, operational issues, competitor analysis, capital spending requirements, working capital needs, customer needs to replace aging equipment, increased complexity of drilling, new technology, and existing backlog among other items which impact the individual reporting unit projections. Cash flows beyond the specific operating plans were estimated using a terminal value calculation, which incorporated historical and forecasted financial cyclical trends for each reporting unit and considered long-term earnings growth rates. The financial and credit market volatility directly impacts our fair value measurement through our weighted average cost of capital that we use to determine our discount rate. During times of volatility, significant judgment must be applied to determine whether credit changes are a short-term or long-term trend. During the fourth quarter of 2015, the worldwide average rig count was 2,034 rigs, down 7% from the third quarter 2015 average of 2,188 and down 44% from the fourth quarter 2014 average of 3,632. The fourth quarter 2015 average rig count represented the lowest quarterly average in the past six years. The annual impairment test, as described in ASC Topic 350, “Intangibles—Goodwill and Other” (“ASC Topic 350”), is performed as of October 1 of each year. Based on the Company’s annual impairment test performed in the fourth quarter of 2015, the calculated fair values for all of the Company’s reporting units were in excess of the respective reporting unit’s carrying value, with two exceptions. Two reporting units within the Company’s Wellbore Technologies segment, had a calculated fair value below carrying value, and were required to perform step two resulting in a $1,485 million write-down in goodwill. The implied fair value of goodwill is determined by deducting the fair value of a reporting unit’s identifiable assets and liabilities from the fair value of that reporting unit as a whole. Fair value of the reporting units is determined in accordance with ASC Topic 820 “Fair Value Measurements and Disclosures” using significant unobservable inputs, or level 3 in the fair value hierarchy. These inputs are based on internal management estimates, forecasts and judgments, using discounted cash flow. Other indefinite-lived intangible assets, representing trade names management intends to use indefinitely, were valued using significant unobservable inputs (level 3) and are tested for impairment using the Relief from Royalty Method, a form of the Income Approach. An impairment is measured and recognized based on the amount the book value of the indefinite-lived intangible assets exceeds its estimated fair value as of the date of the impairment test. Included in the impairment test are assumptions, for each trade name, regarding the related revenue streams attributable to the trade names, which are determined in a manner consistent with the forecasting process described above, the royalty rate, and the discount rate applied. Based on the Company’s annual indefinite-lived intangible asset impairment analysis performed during the fourth quarter of 2015, the fair value for all of the Company’s intangible assets with indefinite lives were in excess of the respective asset carrying values, with one exception. This intangible asset, which represents a trade name within the Company’s Wellbore Technologies segment, had a calculated fair value approximately $149 million below its carrying value. In addition, during the third quarter of 2015, the Company incurred $55 million in impairment charges on identified intangible assets with finite lives that were impaired and written off. These impairment charges were primarily the result of the substantial decline in oil prices and worldwide rig counts continuing in the fourth quarter of 2015, declines in forecasts in rig activity, and a decline in the revenue forecast for the Company for 2016. Foreign Currency The functional currency for most of our foreign operations is the local currency. The cumulative effects of translating the balance sheet accounts from the functional currency into the U.S. dollar at current exchange rates are included in accumulated other comprehensive income (loss). Revenues and expenses are translated at average exchange rates in effect during the period. Certain other foreign operations, including our operations in Norway, use the U.S. dollar as the functional currency. Accordingly, financial statements of these foreign subsidiaries are remeasured to U.S. dollars for consolidation purposes using current rates of exchange for monetary assets and liabilities and historical rates of exchange for nonmonetary assets and related elements of expense. Revenue and expense elements are remeasured at rates that approximate the rates in effect on the transaction dates. For all operations, gains or losses from remeasuring foreign currency transactions into the functional currency are included in income. Net foreign currency transaction gains (losses) were ($47) million, $20 million and ($24) million for the years ending December 31, 2015, 2014 and 2013, respectively, and are included in other income (expense) in the accompanying statement of income. Historically, the Venezuelan government has devalued the country’s currency. During the first quarters of 2015 and 2013, the Venezuelan government again officially devalued the Venezuelan bolivar against the U.S. dollar. As a result, the Company incurred approximately $9 million and $12 million in devaluation charges in the first quarter of 2015 and 2013, respectively. The reporting currency of all of the Company’s Venezuelan entities is the U.S. dollar. The Company’s net remaining investment in Venezuela, which is largely U.S. dollar, was $25 million at December 31, 2015. During the fourth quarter of 2015, the Argentinian government officially devalued the Argentine peso against the U.S. dollar. As a result, the Company incurred approximately $7 million devaluation charges in the fourth quarter of 2015. The reporting currency of all of the Company’s Argentinian entities is the Argentine peso. Revenue Recognition The Company’s products and services are sold based upon purchase orders or contracts with the customer that include fixed or determinable prices and that do not generally include right of return or other similar provisions or other significant post delivery obligations. Except for certain construction contracts and drill pipe sales described below, the Company records revenue at the time its manufacturing process is complete, the customer has been provided with all proper inspection and other required documentation, title and risk of loss has passed to the customer, collectability is reasonably assured and the product has been delivered. Customer advances or deposits are deferred and recognized as revenue when the Company has completed all of its performance obligations related to the sale. The Company also recognizes revenue as services are performed. The amounts billed for shipping and handling cost are included in revenue and related costs are included in cost of sales. Revenue Recognition under Long-term Construction Contracts The Company uses the percentage-of-completion method to account for certain long-term construction contracts in the Rig Systems and Completion & Production Solutions segments. These long-term construction contracts include the following characteristics: • the contracts include custom designs for customer specific applications; • the structural design is unique and requires significant engineering efforts; and • construction projects often have progress payments. This method requires the Company to make estimates regarding the total costs of the project, progress against the project schedule and the estimated completion date, all of which impact the amount of revenue and gross margin the Company recognizes in each reporting period. The Company prepares detailed cost estimates at the beginning of each project. Significant projects and their related costs and profit margins are updated and reviewed at least quarterly by senior management. Factors that may affect future project costs and margins include shipyard access, weather, production efficiencies, availability and costs of labor, materials and subcomponents and other factors. These factors can impact the accuracy of the Company’s estimates and materially impact the Company’s current and future reported earnings. The asset, “Costs in excess of billings,” represents revenues recognized in excess of amounts billed. The liability, “Billings in excess of costs,” represents billings in excess of revenues recognized. Drill Pipe Sales For drill pipe sales, if requested in writing by the customer, delivery may be satisfied through delivery to the Company’s customer storage location or to a third-party storage facility. For sales transactions where title and risk of loss have transferred to the customer but the supporting documentation does not meet the criteria for revenue recognition prior to the products being in the physical possession of the customer, the recognition of the revenues and related inventory costs from these transactions are deferred until the customer takes physical possession. Service and Product Warranties The Company provides service and warranty policies on certain of its products. The Company accrues liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claim experience in accordance with ASC Topic 450 “Contingencies” (“ASC Topic 450”). Adjustments are made to accruals as claim data and historical experience change. In addition, the Company incurs discretionary costs to service its products in connection with product performance issues and accrues for them when they are encountered. The Company monitors the actual cost of performing these discretionary services and adjusts the accrual based on the most current information available. The changes in the carrying amount of service and product warranties are as follows (in millions): Balance at December 31, 2013 $ 228 Net provisions for warranties issued during the year 123 Amounts incurred (78 ) Currency translation adjustments and other (1 ) Balance at December 31, 2014 $ 272 Net provisions for warranties issued during the year 92 Amounts incurred (117 ) Currency translation adjustments and other (3 ) Balance at December 31, 2015 $ 244 Income Taxes The liability method is used to account for income taxes. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates that will be in effect when the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to amounts which are more likely than not to be realized. Concentration of Credit Risk We grant credit to our customers, which operate primarily in the oil and gas industry. Concentrations of credit risk are limited because we have a large number of geographically diverse customers, thus spreading trade credit risk. We control credit risk through credit evaluations, credit limits and monitoring procedures. We perform periodic credit evaluations of our customers’ financial condition and generally do not require collateral, but may require letters of credit for certain international sales. Credit losses are provided for in the financial statements. Allowances for doubtful accounts are determined based on a continuous process of assessing the Company’s portfolio on an individual customer basis taking into account current market conditions and trends. This process consists of a thorough review of historical collection experience, current aging status of the customer accounts, and financial condition of the Company’s customers. Based on a review of these factors, the Company will establish or adjust allowances for specific customers. Accounts receivable are net of allowances for doubtful accounts of approximately $159 million and $125 million at December 31, 2015 and 2014. Stock-Based Compensation Compensation expense for the Company’s stock-based compensation plans is measured using the fair value method required by ASC Topic 718 “Compensation—Stock Compensation” (“ASC Topic 718”). Under this guidance the fair value of stock option grants and restricted stock is amortized to expense using the straight-line method over the shorter of the vesting period or the remaining employee service period. The Company provides compensation benefits to employees and non-employee directors under share-based payment arrangements, including various employee stock option plans. Environmental Liabilities When environmental assessments or remediations are probable and the costs can be reasonably estimated, remediation liabilities are recorded on an undiscounted basis and are adjusted as further information develops or circumstances change. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect reported and contingent amounts of assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Such estimates include but are not limited to, estimated losses on accounts receivable, estimated costs and related margins of projects accounted for under percentage-of-completion, estimated realizable value on excess and obsolete inventory, contingencies, estimated liabilities for litigation exposures and liquidated damages, estimated warranty costs, estimates related to pension accounting, estimates related to the fair value of reporting units for purposes of assessing goodwill and other indefinite-lived intangible assets for impairment and estimates related to deferred tax assets and liabilities, including valuation allowances on deferred tax assets. Actual results could differ from those estimates. Contingencies The Company accrues for costs relating to litigation claims and other contingent matters, including liquidated damage liabilities, when such liabilities become probable and reasonably estimable. In circumstances where the most likely outcome of a contingency can be reasonably estimated, we accrue a liability for that amount. Where the most likely outcome cannot be estimated, a range of potential losses is established and if no one amount in that range is more likely than others, the low end of the range is accrued. Such estimates may be based on advice from third parties or on management’s judgment, as appropriate. Revisions to contingent liabilities are reflected in income in the period in which different facts or information become known or circumstances change that affect the Company’s previous judgments with respect to the likelihood or amount of loss. Amounts paid upon the ultimate resolution of contingent liabilities may be materially different from previous estimates and could require adjustments to the estimated reserves to be recognized in the period such new information becomes known. Net Income Attributable to Company Per Share The following table sets forth the computation of weighted average basic and diluted shares outstanding (in millions, except per share data): Years Ended December 31, 2015 2014 2013 Numerator: Income (loss) from continuing operations $ (769 ) $ 2,450 $ 2,180 Income from discontinued operations $ — $ 52 $ 147 Net income (loss) attributable to Company $ (769 ) $ 2,502 $ 2,327 Denominator: Basic—weighted average common shares outstanding 387 428 426 Dilutive effect of employee stock options and other unvested stock awards — 2 2 Diluted outstanding shares 387 430 428 Per share data: Basic: Income (loss) from continuing operations $ (1.99 ) $ 5.73 $ 5.11 Income from discontinued operations $ — $ 0.12 $ 0.35 Net income (loss) attributable to Company $ (1.99 ) $ 5.85 $ 5.46 Diluted: Income (loss) from continuing operations $ (1.99 ) $ 5.70 $ 5.09 Income from discontinued operations $ — $ 0.12 $ 0.35 Net income (loss) attributable to Company $ (1.99 ) $ 5.82 $ 5.44 Cash dividends per share $ 1.84 $ 1.64 $ 0.91 ASC Topic 260, “Earnings Per Share” (“ASC Topic 260”) requires companies with unvested participating securities to utilize a two-class method for the computation of net income attributable to Company per share. The two-class method requires a portion of net income attributable to Company to be allocated to participating securities, which are unvested awards of share-based payments with non-forfeitable rights to receive dividends or dividend equivalents, if declared. Net income attributable to Company allocated to these participating securities was immaterial for the years ended December 31, 2015, 2014 and 2013 and therefore not excluded from net income attributable to Company per share calculation. The Company had stock options outstanding that were anti-dilutive totaling 13 million, 8 million, and 7 million at December 31, 2015, 2014 and 2013, respectively. Recently Issued Accounting Standards In November 2015, the FASB issued ASU 2015-17 “Balance Sheet Classification of Deferred Taxes” (ASU No. 2015-17), which amends existing guidance on income taxes to require the classification of all deferred tax assets and liabilities as non-current on the balance sheet. ASU No. 2015-17 is effective for fiscal years beginning after December 15, 2017, with early adoption permitted, and the guidance may be applied either prospectively or retrospectively. The Company does not expect the adoption of ASU No. 2015-17 will have a material effect on its consolidated financial position and results of operations. In April 2015, the FASB issued an ASU 2015-03 “ In May 2014, the FASB issued Accounting Standard Update No. 2014-09 “Revenue from Contracts with Customers” (ASU No. 2014-09), which supersedes the revenue recognition requirements in Accounting Standard Codification Topic No. 605 “Revenue Recognition” and most industry-specific guidance. This update requires that entities recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which a company expects to be entitled in exchange for those goods or services. ASU No. 2014-09 is effective for fiscal years beginning after December 15, 2017, and for interim periods within those fiscal years. The Company is currently assessing the impact of the adoption of ASU No. 2014-09 on its consolidated financial position and results of operations. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 3. Derivative Financial Instruments The Company is exposed to certain risks relating to its ongoing business operations. The primary risk managed by using derivative instruments is foreign currency exchange rate risk. Forward contracts against various foreign currencies are entered into to manage the foreign currency exchange rate risk on forecasted revenues and expenses denominated in currencies other than the functional currency of the operating unit (cash flow hedge). Other forward exchange contracts against various foreign currencies are entered into to manage the foreign currency exchange rate risk associated with certain firm commitments denominated in currencies other than the functional currency of the operating unit (fair value hedge). In addition, the Company will enter into non-designated forward contracts against various foreign currencies to manage the foreign currency exchange rate risk on recognized nonfunctional currency monetary accounts (non-designated hedge). At December 31, 2015, the Company has determined that the fair value of its derivative financial instruments representing assets of $26 million and liabilities of $286 million (primarily currency related derivatives) are determined using level 2 inputs (inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability) in the fair value hierarchy as the fair value is based on publicly available foreign exchange and interest rates at each financial reporting date. At December 31, 2015, the net fair value of the Company’s foreign currency forward contracts totaled a net liability of $260 million. At December 31, 2015, the Company’s financial instruments do not contain any credit-risk-related or other contingent features that could cause accelerated payments when the Company’s financial instruments are in net liability positions. We do not use derivative financial instruments for trading or speculative purposes. Cash Flow Hedging Strategy To protect against the volatility of forecasted foreign currency cash flows resulting from forecasted revenues and expenses, the Company has instituted a cash flow hedging program. The Company hedges portions of its forecasted revenues and expenses denominated in nonfunctional currencies with forward contracts. When the U.S. dollar strengthens against the foreign currencies, the decrease in present value of future foreign currency revenues and expenses is offset by gains in the fair value of the forward contracts designated as hedges. Conversely, when the U.S. dollar weakens, the increase in the present value of future foreign currency cash flows is offset by losses in the fair value of the forward contracts. For derivative instruments that are designated and qualify as a cash flow hedge (i.e., hedging the exposure to variability in expected future cash flows that is subject to a particular currency risk), the effective portion of the gain or loss on the derivative instrument is reported as a component of Other Comprehensive Income (Loss) and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period or periods during which the hedged transaction affects earnings (e.g., in “revenues” when the hedged transactions are cash flows associated with forecasted revenues). The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item, if any (i.e., the ineffective portion), or hedge components excluded from the assessment of effectiveness, is recognized in the Consolidated Statements of Income (Loss) during the current period. The Company had the following outstanding foreign currency forward contracts that were entered into to hedge nonfunctional currency cash flows from forecasted revenues and expenses (in millions): Currency Denomination Foreign Currency December 31, December 31, Norwegian Krone NOK 9,655 NOK 10,781 U.S. Dollar USD 321 USD 231 Euro EUR 78 EUR 462 Danish Krone DKK 57 DKK 227 Singapore Dollar SGD 14 SGD 44 British Pound Sterling GBP 4 GBP 80 Canadian Dollar CAD 2 CAD 14 Non-designated Hedging Strategy The Company enters into forward exchange contracts to hedge certain nonfunctional currency monetary accounts. The purpose of the Company’s foreign currency hedging activities is to protect the Company from risk that the eventual U.S. dollar equivalent cash flows from the nonfunctional currency monetary accounts will be adversely affected by changes in the exchange rates. For derivative instruments that are non-designated, the gain or loss on the derivative instrument subject to the hedged risk (i.e., nonfunctional currency monetary accounts) is recognized in other income (expense), net in current earnings. The Company had the following outstanding foreign currency forward contracts that hedge the fair value of nonfunctional currency monetary accounts (in millions): Currency Denomination Foreign Currency December 31, December 31, Norwegian Krone NOK 2,265 NOK 4,052 Russian Ruble RUB 2,164 RUB — U.S. Dollar USD 515 USD 1,092 Euro EUR 371 EUR 401 Danish Krone DKK 153 DKK 322 British Pound Sterling GBP 11 GBP 19 Canadian Dollar CAD 7 CAD 4 Singapore Dollar SGD 5 SGD 4 Mexican Peso MXN — MXN 118 Brazilian Real BRL — BRL 57 Swedish Krone SEK — SEK 3 The Company has the following fair values of its derivative instruments and their balance sheet classifications (in millions): Fair Values of Derivative Instruments (In millions) Asset Derivatives Liability Derivatives Balance Sheet Location Fair Value December 31, Balance Sheet Location Fair Value December 31, 2015 2014 2015 2014 Derivatives designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 5 $ 18 Accrued liabilities $ 212 $ 204 Foreign exchange contracts Other Assets — 8 Other Liabilities 25 102 Total derivatives designated as hedging instruments under ASC Topic 815 $ 5 $ 26 $ 237 $ 306 Derivatives not designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 21 $ 27 Accrued liabilities $ 49 $ 93 Total derivatives not designated as hedging instruments under ASC Topic 815 $ 21 $ 27 $ 49 $ 93 Total derivatives $ 26 $ 53 $ 286 $ 399 The Effect of Derivative Instruments on the Consolidated Statements of Income (Loss) ($ in millions) Derivatives Amount of Gain (Loss) Location of Gain Amount of Gain Location of Gain (Loss) Amount of Gain Years Ended Years Ended Years Ended 2015 2014 2015 2014 2015 2014 Revenue 19 26 Cost of revenue (33 ) (1 ) Foreign exchange contracts (243 ) (340 ) Cost of revenue (262 ) (43 ) Other income (expense), net 4 36 Total (243 ) (340 ) (243 ) (17 ) (29 ) 35 Derivatives Not Location of Gain (Loss) Amount of Gain Years Ended 2015 2014 Foreign exchange contracts Other income (expense), net (97 ) (61 ) Total (97 ) (61 ) (a) The Company expects that $(223) million of the Accumulated Other Comprehensive Income (Loss) will be reclassified into earnings within the next twelve months with an offset by gains from the underlying transactions resulting in no impact to earnings or cash flow. (b) The amount of gain (loss) recognized in income represents $(33) million and $(1) million related to the ineffective portion of the hedging relationships for the years ended December 31, 2015 and 2014, respectively, and $4 million and $36 million related to the amount excluded from the assessment of the hedge effectiveness for the years ended December 31, 2015 and 2014, respectively. |
Acquisitions and Investments
Acquisitions and Investments | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Acquisitions and Investments | 4. Acquisitions and Investments 2015 In the year ended December 31, 2015, the Company completed seven acquisitions and other investments for an aggregate purchase price of $86 million, net of cash acquired. The Company has preliminarily allocated $12 million to identifiable intangible assets and $56 million to goodwill. The amount allocated to goodwill represents the excess of the purchase price over the fair value of the net assets acquired. Goodwill specifically includes the expected synergies and other benefits that the Company believes will result from combining its operations with those of businesses acquired and other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. Goodwill resulting from the acquisitions is not deductible for tax purposes. 2014 In the year ended December 31, 2014, the Company completed 10 acquisitions for an aggregate purchase price of $291 million, net of cash acquired. The Company has allocated $59 million to identifiable intangible assets and $167 million to goodwill. The amount allocated to goodwill represents the excess of the purchase price over the fair value of the net assets acquired. Goodwill specifically includes the expected synergies and other benefits that the Company believes will result from combining its operations with those of businesses acquired and other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. Goodwill resulting from the acquisitions is not deductible for tax purposes. 2013 On February 20, 2013, the Company completed its acquisition of all of the shares of Robbins & Myers, Inc. (“R&M”), a U.S.-based designer and manufacturer of products and systems for the oil and gas industry. Under the merger agreement for this transaction, R&M shareholders received $60.00 in cash for each common share for an aggregate purchase price of $2,378 million, net of cash acquired. In addition to R&M, the Company completed five acquisitions and other investments for an aggregate purchase price of $19 million, net of cash acquired. The Company has included the financial results of R&M in its consolidated financial statements as of the date of acquisition with components of the R&M operations included in each of the Company’s segments. The Company believes the acquisition of R&M will advance its strategic goal of providing a broader selection of products and services to its customers. The following table displays the total purchase price allocation for the R&M acquisition. The table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition (in millions): 2013 Current assets, net of cash acquired $ 428 Property, plant and equipment 250 Intangible assets 894 Goodwill 1,590 Other assets 49 Total assets acquired 3,211 Current liabilities 186 Deferred taxes 524 Other liabilities 123 Total liabilities 833 Cash consideration, net of cash acquired $ 2,378 The Company has allocated $894 million to identifiable intangible assets (19 year weighted-average life). The intangible assets are amortizable and are comprised of: $635 million of customer relationships (18 year weighted-average life), $170 million of patents (20 year weighted-average life), $86 million of trademarks (20 year weighted-average life), and $3 million of other intangible assets (1 year weighted-average life). The amount allocated to goodwill represents the excess of the purchase price over the fair value of the net assets acquired. Goodwill specifically includes the expected synergies and other benefits that the Company believes will result from combining its operations with those of businesses acquired and other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. Goodwill resulting from the R&M acquisition is not deductible for tax purposes. Each of the acquisitions was accounted for using the purchase method of accounting and, accordingly, the results of operations of each business are included in the consolidated statements of income from the date of acquisition. A summary of the acquisitions follows (in millions): Years Ended December 31, 2015 2014 2013 Fair value of assets acquired, net of cash acquired $ 116 $ 406 $ 3,329 Cash paid, net of cash acquired (86 ) (291 ) (2,397 ) Liabilities assumed, debt issued and noncontrolling interest $ 30 $ 115 $ 932 Excess purchase price over fair value of net assets acquired $ 56 $ 167 $ 1,903 |
Inventories, net
Inventories, net | 12 Months Ended |
Dec. 31, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories, net | 5. Inventories, net Inventories consist of (in millions): December 31, 2015 2014 Raw materials and supplies $ 1,069 $ 1,255 Work in process 632 1,027 Finished goods and purchased products 2,977 2,999 Total $ 4,678 $ 5,281 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 6. Property, Plant and Equipment Property, plant and equipment consist of (in millions): Estimated Useful Lives December 31, 2015 2014 Land and buildings 5-35 Years $ 1,582 $ 1,528 Operating equipment 3-15 Years 3,055 3,060 Rental equipment 3-12 Years 639 817 5,276 5,405 Less: Accumulated Depreciation (2,152 ) (2,043 ) $ 3,124 $ 3,362 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | 7. Accrued Liabilities Accrued liabilities consist of (in millions): December 31, 2015 2014 Accrued vendor costs $ 449 $ 815 Customer prepayments and billings 426 703 Fair value of derivatives 261 297 Warranty 244 272 Compensation 241 662 Taxes (non income) 175 211 Insurance 113 126 Accrued commissions 73 97 Interest 8 11 Other 294 324 Total $ 2,284 $ 3,518 |
Costs and Estimated Earnings on
Costs and Estimated Earnings on Uncompleted Contracts | 12 Months Ended |
Dec. 31, 2015 | |
Text Block [Abstract] | |
Costs and Estimated Earnings on Uncompleted Contracts | 8. Costs and Estimated Earnings on Uncompleted Contracts Costs and estimated earnings on uncompleted contracts consist of (in millions): December 31, 2015 2014 Costs incurred on uncompleted contracts $ 9,082 $ 10,442 Estimated earnings 4,080 4,699 13,162 15,141 Less: Billings to date on uncompleted contracts 12,697 15,038 $ 465 $ 103 Costs and estimated earnings in excess of billings on uncompleted contracts $ 1,250 $ 1,878 Billings in excess of costs and estimated earnings on uncompleted contracts (785 ) (1,775 ) $ 465 $ 103 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt | 9. Debt Debt consists of (in millions): December 31, 2015 2014 Senior Notes, interest at 6.125% payable semiannually, principal due on August 15, 2015 — 151 Senior Notes, interest at 1.35% payable semiannually, principal due on December 1, 2017 500 500 Senior Notes, interest at 2.6% payable semiannually, principal due on December 1, 2022 1,396 1,396 Senior Notes, interest at 3.95% payable semiannually, principal due on December 1, 2042 1,096 1,096 Commercial paper 893 — Other 45 23 Total debt 3,930 3,166 Less current portion 2 152 Long-term debt $ 3,928 $ 3,014 Principal payments of debt for years subsequent to 2015 are as follows (in millions): 2016 $ 2 2017 506 2018 898 2019 5 2020 5 Thereafter 2,514 $ 3,930 On August 15, 2015, the Company repaid $151 million of its 6.125% unsecured Senior Notes using available cash balances. During the second quarter of 2015, the Company exercised its accordion option to increase aggregate borrowing capacity under its five-year unsecured revolving credit facility by an additional $1.0 billion, bringing the aggregate borrowing capacity to $4.5 billion. The facility expires September 28, 2018. The Company also has a commercial paper program under which borrowings are classified as long-term since the program is supported by the $4.5 billion, five-year unsecured revolving credit facility. At December 31, 2015, there were $893 million in commercial paper borrowings, and there were no outstanding letters of credit issued under the credit facility, resulting in $3,607 million of funds available under this revolving credit facility. Interest under this multicurrency facility is based upon LIBOR, NIBOR or EURIBOR plus 0.875% subject to a ratings-based grid, or the U.S. prime rate. The credit facility contains a financial covenant regarding maximum debt to capitalization and the Company was in compliance at December 31, 2015. The Company also had $2,378 million of additional outstanding letters of credit at December 31, 2015, primarily in the U.S., that are under various bilateral committed letter of credit facilities. Other letters of credit are issued as bid bonds, advanced payment bonds and performance bonds. At December 31, 2015 and 2014, the fair value of the Company’s unsecured Senior Notes approximated $2,551 million and $2,974 million, respectively. The fair value of the Company’s debt is estimated using Level 2 inputs in the fair value hierarchy and is based on quoted prices for those or similar instruments. At December 31, 2015 and 2014, the carrying value of the Company’s unsecured Senior Notes approximated $2,992 million and $3,143 million, respectively. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plans | 10. Employee Benefit Plans We have benefit plans covering substantially all of our employees. Defined-contribution benefit plans cover most of the U.S. and Canadian employees, and benefits are based on years of service, a percentage of current earnings and matching of employee contributions. We also have defined contribution plans in Norway and the United Kingdom. For the years ended December 31, 2015, 2014 and 2013, expenses for defined-contribution plans were $95 million, $115 million, and $96 million, respectively, and all funding is current. Certain retired or terminated employees of predecessor or acquired companies participate in a defined benefit plan in the United States. Approximately 75 employees represented by certain collective bargaining agreements continue to accrue benefits under the plan. In addition, approximately 1,900 U.S. retirees and spouses participate in defined benefit health care plans of predecessor or acquired companies that provide postretirement medical and life insurance benefits. Except for two locations represented by certain collective bargaining agreements, active employees are ineligible to participate in any of these U.S. defined benefit plans. Active employees based in the United Kingdom are ineligible to participate in any defined benefit plans. In Norway, a small number of active employees (approximately 300) continue to participate in a defined benefit plan, while the other employees, including new hires, participate in a defined contribution plan. During 2014, the Company sold certain industrial assets of which the impact on the defined benefit plans is reflected in the table below. Net periodic benefit cost for our defined benefit plans aggregated $5 million, $7 million and $10 million for the years ended December 31, 2015, 2014 and 2013, respectively. The change in benefit obligation, plan assets and the funded status of the defined benefit pension plans in the United States, United Kingdom, Norway, Germany and the Netherlands and defined postretirement plans in the United States, using a measurement date of December 31, 2015 and 2014, is as follows (in millions): Pension benefits Postretirement At year end 2015 2014 2015 2014 Benefit obligation at beginning of year $ 792 $ 846 $ 53 $ 45 Service cost 6 8 — — Interest cost 26 35 3 2 Actuarial loss (gain) (38 ) 116 (7 ) 15 Benefits paid (34 ) (43 ) (5 ) (4 ) Participants contributions — — 1 1 Exchange rate loss (gain) (33 ) (51 ) — — Acquisitions (disposals) — (118 ) — (6 ) Curtailments (16 ) (1 ) — — Other — — 45 — Benefit obligation at end of year $ 703 $ 792 $ 90 $ 53 Fair value of plan assets at beginning of year $ 660 $ 706 $ — $ — Actual return 3 68 — — Benefits paid (34 ) (43 ) (5 ) (4 ) Company contributions 12 21 4 3 Participants contributions — — 1 1 Exchange rate gain (loss) (23 ) (31 ) — — Acquisitions (disposals) (17 ) (61 ) — — Fair value of plan assets at end of year $ 601 $ 660 $ — $ — Funded status $ (102 ) $ (132 ) $ (90 ) $ (53 ) Accumulated benefit obligation at end of year $ 685 $ 764 Liabilities associated with the funded status of the defined benefit pension plans are included in the balances of accrued liabilities and other liabilities in the Consolidated Balance Sheet. Defined Benefit Pension Plans Assumed long-term rates of return on plan assets, discount rates and rates of compensation increases vary for the different plans according to the local economic conditions. The assumption rates used for benefit obligations are as follows: Years Ended December 31, 2015 2014 Discount rate: United States plan 3.40% - 3.90% 3.40% - 3.90% International plans 2.10% - 3.60% 2.10% - 3.60% Salary increase: United States plan N/A N/A International plans 2.00% - 4.20% 2.00% - 4.20% The assumption rates used for net periodic benefit costs are as follows: Years Ended December 31, 2015 2014 2013 Discount rate: United States plan 3.70% - 4.20% 3.99% - 4.67% 3.80% International plans 2.20% - 3.70% 3.50% - 4.40% 3.46% - 4.40% Salary increase: United States plan N/A N/A N/A International plans 2.00% - 4.20% 2.00% - 4.40% 2.00% - 3.53% Expected return on assets: United States plan 5.50% 6.50% 6.30% International plans 2.30% - 5.12% 3.50% - 5.53% 3.50% - 5.82% In determining the overall expected long-term rate of return for plan assets, the Company takes into consideration the historical experience as well as future expectations of the asset mix involved. As different investments yield different returns, each asset category is reviewed individually and then weighted for significance in relation to the total portfolio. The majority of our plans have projected benefit obligations in excess of plan assets. The Company expects to pay future benefit amounts on its defined benefit plans of approximately $35 million for each of the next five years and aggregate payments of $370 million. Plan Assets The Company and its investment advisers collaboratively reviewed market opportunities using historic and statistical data, as well as the actuarial valuation reports for the plans, to ensure that the levels of acceptable return and risk are well-defined and monitored. Currently, the Company’s management believes that there are no significant concentrations of risk associated with plan assets. Our pension investment strategy worldwide prohibits a direct investment in our own stock. The following table sets forth by level, within the fair value hierarchy, the Plan’s assets carried at fair value (in millions): Fair Value Measurements Total Level 1 Level 2 Level 3 December 31, 2014: Equity securities $ 116 $ — $ 116 $ — Bonds 323 — 323 — Other (insurance contracts) 221 — 113 108 Total Fair Value Measurements $ 660 $ — $ 552 $ 108 December 31, 2015: Equity securities $ 186 $ — $ 186 $ — Bonds 259 — 259 — Other (insurance contracts) 156 — 57 99 Total Fair Value Measurements $ 601 $ — $ 502 $ 99 Level 3 inputs are unobservable (i.e., supported by little or no market activity). Level 3 inputs include management’s own judgement about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). The following table sets forth a summary of changes in the fair value of the Plan’s Level 3 assets (in millions): Level 3 Balance at December 31, 2013 $ 107 Actual return on plan assets still held at reporting date 14 Purchases, sales and settlements 5 Currency translation adjustments (18 ) Balance at December 31, 2014 $ 108 Actual return on plan assets still held at reporting date 3 Purchases, sales and settlements 2 Currency translation adjustments (14 ) Balance at December 31, 2015 $ 99 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | 11. Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive income (loss) are as follows (in millions): Currency Derivative Defined Total Balance at December 31, 2012 $ 132 $ 42 $ (67 ) $ 107 Accumulated other comprehensive income (loss) before reclassifications (90 ) (29 ) 48 (71 ) Amounts reclassified from accumulated other comprehensive income (loss) (25 ) (8 ) (7 ) (40 ) Balance at December 31, 2013 $ 17 $ 5 $ (26 ) $ (4 ) Accumulated other comprehensive income (loss) before reclassifications (543 ) (245 ) (59 ) (847 ) Amounts reclassified from accumulated other comprehensive income (loss) 11 12 (6 ) 17 Balance at December 31, 2014 $ (515 ) $ (228 ) $ (91 ) $ (834 ) Accumulated other comprehensive income (loss) before reclassifications (764 ) (176 ) 26 (914 ) Amounts reclassified from accumulated other comprehensive income (loss) — 199 (4 ) 195 Balance at December 31, 2015 $ (1,279 ) $ (205 ) $ (69 ) $ (1,553 ) The components of amounts reclassified from accumulated other comprehensive income (loss) are as follows (in millions): Years Ended December 31, 2015 2014 2013 Currency Derivative Defined Total Currency Derivative Defined Total Currency Derivative Defined Total Revenue $ — $ (19 ) $ — $ (19 ) $ — $ (26 ) $ — $ (26 ) $ — $ (16 ) $ — $ (16 ) Cost of revenue — 295 — 295 — 43 — 43 — 6 — 6 — — — Selling, general, and administrative — — (6 ) (6 ) — — (8 ) (8 ) — — (8 ) (8 ) — Other income (expense), net — — — — 11 — — 11 (25 ) — — (25 ) Tax effect — (77 ) 2 (75 ) — (5 ) 2 (3 ) — 2 1 3 $ — $ 199 $ (4 ) $ 195 $ 11 $ 12 $ (6 ) $ 17 $ (25 ) $ (8 ) $ (7 ) $ (40 ) The Company’s reporting currency is the U.S. dollar. A majority of the Company’s international entities in which there is a substantial investment have the local currency as their functional currency. As a result, currency translation adjustments resulting from the process of translating the entities’ financial statements into the reporting currency are reported in other comprehensive income or loss in accordance with ASC Topic 830 “Foreign Currency Matters” (“ASC Topic 830”). For the years ended December 31, 2015, 2014 and 2013 a majority of these local currencies weakened against the U.S. dollar resulting in a net other comprehensive loss of $764 million, $543 million and $90 million, respectively, upon the translation from local currencies to the U.S. dollar. Due to the sale of non-core industrial businesses, $11 million of currency translation losses and $25 million of currency translation gains were reclassified from accumulated other comprehensive income (loss) into other income (expense), net in the Consolidated Statements of Income for the years ended December 31, 2014 and 2013 respectively. The effect of changes in the fair values of derivatives designated as cash flow hedges are accumulated in other comprehensive income (loss), net of tax, until the underlying transactions to which they are designed to hedge are realized. The movement in other comprehensive income (loss) from period to period will be the result of the combination of changes in fair value for open derivatives and the outflow of other comprehensive income (loss) related to cumulative changes in the fair value of derivatives that have settled in the current or prior periods. The accumulated effect was other comprehensive income of $23 million (net of tax of $14 million) for the year ended December 31, 2015, other comprehensive loss of $233 million (net of tax of $89 million) for the year ended December 31, 2014 and other comprehensive loss of $37 million (net of tax of $18 million) for the year ended December 31, 2013. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12. Commitments and Contingencies We have received U.S. federal grand jury subpoenas and subsequent inquiries from U.S. governmental agencies requesting records related to our compliance with U.S. export trade laws and regulations. We have cooperated fully with agents from the U.S. Department of Justice, the Department of Commerce Bureau of Industry and Security, the United States Department of Treasury, Office of Foreign Assets Control, and U.S. Immigration and Customs Enforcement in responding to the inquiries. We have also cooperated with an informal inquiry from the Securities and Exchange Commission in connection with the inquiries previously made by the aforementioned federal agencies. We have conducted our own internal review of this matter. At the conclusion of our internal review in the fourth quarter of 2009, we identified possible areas of concern and discussed these areas of concern with the relevant agencies. We are currently negotiating a potential resolution with the agencies involved related to these matters. We currently anticipate that any administrative fine or penalty agreed to as part of a resolution would be within established accruals, and would not have a material effect on our financial position or results of operations. To the extent a resolution is not negotiated, we cannot predict the timing or effect that any resulting government actions may have on our financial position or results of operations. In addition, we are involved in various other claims, internal investigations, regulatory agency audits and pending or threatened legal actions involving a variety of matters. In many instances, the Company maintains insurance that covers claims arising from risks associated with the business activities of the Company, including claims for premises liability, product liability and other such claims. The Company carries substantial insurance to cover such risks above a self-insured retention. The Company believes and the Company’s experience has been that such insurance has been sufficient to cover such risks. See Item 1A. Risk Factors. As of December 31, 2015, the Company recorded reserves in an amount believed to be sufficient for contingent liabilities representing all contingencies believed to be probable to cover liabilities. The Company has also assessed the potential for additional losses above the amounts accrued as well as potential losses for matters that are not probable but are reasonably possible. The total potential loss on these matters cannot be determined; however, in our opinion, any ultimate liability, to the extent not otherwise provided for and except for the specific cases referred to above, will not materially affect our financial position, cash flow or results of operations. As it relates to the specific cases referred to above we currently anticipate that any administrative fine or penalty agreed to as part of a resolution would be within established accruals, and would not have a material effect on our financial position or results of operations. To the extent a resolution is not negotiated as anticipated, we cannot predict the timing or effect that any resulting government actions may have on our financial position, cash flow or results of operations. These estimated liabilities are based on the Company’s assessment of the nature of these matters, their progress toward resolution, the advice of legal counsel and outside experts as well as management’s intention and experience. Our business is affected both directly and indirectly by governmental laws and regulations relating to the oilfield service industry in general, as well as by environmental and safety regulations that specifically apply to our business. Although we have not incurred material costs in connection with our compliance with such laws, there can be no assurance that other developments, such as new environmental laws, regulations and enforcement policies may not result in additional, presently unquantifiable, costs or liabilities to us. Further, in some instances, direct or indirect consumers of our products and services, entities providing financing for purchases of our products and services or members of the supply chain for our products and services may become involved in governmental investigations, internal investigations, political or other enforcement matters. In such circumstances, such investigations may adversely impact the ability of consumers of our products, entities providing financial support to such consumers or entities in the supply chain to timely perform their business plans or to timely perform under agreements with us. The on-going, publicly disclosed investigations in Brazil may continue to adversely impact our shipyard customers, their customers, entities providing financing for our shipyard customers and/or entities in the supply chain. We consummated a settlement with a shipyard customer on December 28, 2015 concerning seven contracts for the supply of drilling equipment packages for drillship construction projects in Brazil (collectively the “Supply Contracts”). Pursuant to the terms of the settlement, the Supply Contracts have been terminated. We did not take a charge as a result of the settlement and, on a net basis, there was no change to our prior estimates on our Brazil contracts impacting income; however we did reduce the Rig Systems segment backlog by $1.2 billion in the quarter. At December 31, 2015, our backlog included $1.8 billion for the remaining 15 rigs across three shipyards in Brazil. The investigations in Brazil have led to, and are expected to continue to lead to, delays in deliveries to our shipyard customers in Brazil, along with temporary suspension of performance under our supply contracts, and could result in additional cancellations or other breaches of our contracts by our shipyard customers. Our shipyard customers’ customer in Brazil has stated its intent to build some of the drillships it originally contracted for with our shipyard customers. Customers (typically drillship owners or drilling contractors) of our shipyard customers have sought, and may in the future seek, to suspend, delay or cancel their contracts or payments due to such shipyards. As a result, our shipyard customers have sought and may in the future seek to suspend, delay or cancel deliveries of our drilling equipment packages for the affected drillships. To the extent our shipyard customers and their customers become engaged in disputes or litigation related to any such suspensions, delays or cancellations, we may also become involved, either directly or indirectly, in such disputes or litigation, as we enforce the terms of our contracts with our shipyard customers. Even though the contracts with our shipyard customers for the supply of drilling equipment packages do not provide for cancellation for convenience, in light of the decline in oil prices and the deterioration in the energy markets, we are starting to experience suspensions, delays and attempted cancellations with greater frequency. While we manage equipment deliveries and collection of payment to achieve milestone payments that mitigate our financial risk, such delays, suspensions, attempted cancellations, breaches of contract or other similar circumstances, could adversely affect our operating results and could reduce our backlog. The Company leases certain facilities and equipment under operating leases that expire at various dates through 2066. These leases generally contain renewal options and require the lessee to pay maintenance, insurance, taxes and other operating expenses in addition to the minimum annual rentals. Rental expense related to operating leases approximated $327 million, $390 million, and $336 million in 2015, 2014 and 2013, respectively. Future minimum lease commitments under noncancellable operating leases with initial or remaining terms of one year or more at December 31, 2015, are payable as follows (in millions): 2016 $ 202 2017 120 2018 91 2019 71 2020 69 Thereafter 369 Total future lease commitments $ 922 |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Common Stock | 13. Common Stock National Oilwell Varco has authorized 1 billion shares of $0.01 par value common stock. The Company also has authorized 10 million shares of $0.01 par value preferred stock, none of which is issued or outstanding. Cash dividends aggregated $710 million and $703 million for the years ended December 31, 2015 and 2014, respectively. The declaration and payment of future dividends is at the discretion of the Company’s Board of Directors and will be dependent upon the Company’s results of operations, financial condition, capital requirements and other factors deemed relevant by the Company’s Board of Directors. During the third quarter of 2015 the Company completed its $3 billion share repurchase program. As shares were repurchased, they were constructively retired and returned to an unissued state. During the years ended December 31, 2015 and 2014, the Company repurchased 44.0 million and 11.6 million shares, respectively, under the program for an average price of $50.53 and $66.97 per share, respectively, for an aggregate amount of $2,221 million and $779 million, respectively. Total compensation cost that has been charged against income for all share-based compensation arrangements was $109 million, $101 million and $92 million for 2015, 2014 and 2013, respectively. The total income tax benefit recognized in the consolidated statement of income for all share-based compensation arrangements was $28 million, $35 million and $28 million for 2015, 2014 and 2013, respectively. Stock Options Under the terms of National Oilwell Varco’s Long-Term Incentive Plan, as amended, 39.5 million shares of common stock are authorized for the grant of options to officers, key employees, non-employee directors and other persons. Options granted under our stock option plan generally vest over a three-year period starting one year from the date of grant and expire ten years from the date of grant. The purchase price of options granted may not be less than the closing market price of National Oilwell Varco common stock on the date of grant. At December 31, 2015, approximately 6.2 million shares were available for future grants. We also have inactive stock option plans that were acquired in connection with the acquisitions of Varco International, Inc. in 2005 and Grant Prideco in 2008. We converted the outstanding stock options under these plans to options to acquire our common stock and no further options are being issued under these plans. Stock option information summarized below includes amounts for the National Oilwell Varco Long-Term Incentive Plan and stock plans of acquired companies. Options outstanding at December 31, 2015 under the stock option plans have exercise prices between $12.15 and $77.99 per share, and expire at various dates from January 13, 2016 to February 26, 2025. On June 2, 2014, as a result of the spin-off and pursuant to the terms of the Employee Matters Agreement and the Plan, outstanding NOV stock-based awards held by continuing NOV employees were adjusted to generally preserve the intrinsic value of the original award. Outstanding NOV stock-based awards held by employees of NOW were converted into similar NOW stock-based awards, each appropriately adjusted to generally preserve the intrinsic value of the original award. Adjustments to the awards are reflected in the following tables and did not have a material impact to compensation expense. The following summarizes options activity: Years Ended December 31, 2015 2014 2013 Number of Average Number of Average Number of Average Shares under option at beginning of year 10,881,133 $ 61.22 11,535,566 $ 58.36 10,274,477 $ 54.11 Granted 5,746,153 54.74 3,389,547 69.00 3,072,086 63.96 Spun-off — — (1,567,348 ) 70.56 — — Cancelled (886,356 ) 62.73 (498,967 ) 70.32 (329,002 ) 66.78 Exercised (310,623 ) 22.56 (1,977,665 ) 53.56 (1,481,995 ) 38.75 Shares under option at end of year 15,430,307 $ 59.50 10,881,133 $ 61.22 11,535,566 $ 58.36 Exercisable at end of year 7,498,414 $ 60.30 5,903,712 $ 55.06 6,324,117 $ 49.29 The following summarizes information about stock options outstanding at December 31, 2015: Range of Exercise Price Weighted-Avg Remaining Contractual Life Options Outstanding Options Exercisable Shares Weighted-Avg Shares Weighted-Avg $12.15 - $55.00 7.34 7,599,928 $ 48.99 2,148,275 $ 34.39 $55.01 - $70.00 7.25 5,045,298 66.22 2,569,643 64.98 $70.01 - $77.99 5.68 2,785,081 76.00 2,780,496 76.00 Total 7.01 15,430,307 $ 59.50 7,498,414 $ 60.30 The weighted-average fair value of options granted during 2015, 2014 and 2013, was approximately $15.41, $25.60 and $24.11 per share, respectively, as determined using the Black-Scholes option-pricing model. The total intrinsic value of options exercised during 2015 and 2014, was $9 million and $111 million, respectively. The determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise activity. The use of the Black Scholes model requires the use of extensive actual employee exercise activity data and the use of a number of complex assumptions including expected volatility, risk-free interest rate, expected dividends and expected term. Years Ended December 31, 2015 2014 2013 Valuation Assumptions: Expected volatility 49.1 % 49.4 % 50.1 % Risk-free interest rate 1.5 % 1.5 % 0.9 % Expected dividends $ 3.36 $ 1.39 $ 0.75 Expected term (in years) 3.0 3.7 3.4 The Company used the actual volatility for traded options for the past 10 years prior to option date as the expected volatility assumption required in the Black Scholes model. The risk-free interest rate assumption is based upon observed interest rates appropriate for the term of our employee stock options. The dividend yield assumption is based on the history and expectation of dividend payouts. The estimated expected term is based on actual employee exercise activity for the past ten years. As stock-based compensation expense recognized in the Consolidated Statement of Income in 2015 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. ASC Topic 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Forfeitures were estimated based on historical experience. The following summary presents information regarding outstanding options at December 31, 2015 and changes during 2015 with regard to options under all stock option plans: Shares Weighted- Weighted Aggregate Outstanding at December 31, 2014 10,881,133 $ 61.22 5.15 $ 85,503,217 Granted 5,746,153 $ 54.74 Cancelled (886,356 ) $ 62.73 Exercised (310,623 ) $ 22.56 Outstanding at December 31, 2015 15,430,307 $ 59.50 7.01 $ 5,894,977 Vested or expected to vest 15,229,713 $ 59.50 7.01 $ 5,814,216 Exercisable at December 31, 2015 7,498,414 $ 60.30 5.16 $ 5,894,977 At December 31, 2015, total unrecognized compensation cost related to nonvested stock options was $95 million. This cost is expected to be recognized over a weighted-average period of two years. The total fair value of stock options vested in 2015, 2014 and 2013 was approximately $72 million, $67 million and $64 million, respectively. Cash received from option exercises for 2015, 2014 and 2013 was $7 million, $108 million and $58 million, respectively. The actual tax benefit realized for the tax deductions from option exercises totaled $7 million, $44 million and $39 million for 2015, 2014 and 2013, respectively. Cash used to settle equity instruments granted under all share-based payment arrangements for 2015, 2014 and 2013 was not material for any period. Restricted Shares The Company issues restricted stock awards and restricted stock units to officers and key employees in addition to stock options. On February 25, 2015, the Company granted 653,750 shares of restricted stock and restricted stock units with a fair value of $54.74 per share; and performance share awards to senior management employees with potential payouts varying from zero to 396,666 shares. The stock options vest over a three-year period from the grant date while the restricted stock and restricted stock units vest on the third anniversary of the date of grant. The performance share awards can be earned based on performance against established goals over a three-year performance period. The performance share awards are divided into two equal, independent parts that are subject to two separate performance metrics: 50% with a TSR (total shareholder return) goal (the “TSR Award”) and 50% with an internal ROC (return on capital) goal (the “ROC Award”). Performance against the TSR goal is determined by comparing the performance of the Company’s TSR with the TSR performance of the members of the OSX index for the three year performance period. Performance against the ROC goal is determined by comparing the performance of the Company’s actual ROC performance average for each of the three years of the performance period against the ROC goal set by the Company’s Compensation Committee. On May 13, 2015, the Company granted 26,992 restricted stock awards with a fair value of $51.88 per share. The awards were granted to non-employee members of the board of directors and vest on the first anniversary of the grant date. On August 28, 2015, the Company granted 75,000 restricted stock awards with a fair value of $41.65 per share. The awards were granted to an officer of the Company and vest over a three-year period from the grant date. The following summary presents information regarding outstanding restricted shares: Years Ended December 31, 2015 2014 2013 Number of Units Weighted- Number of Units Weighted- Number of Units Weighted- Nonvested at beginning of year 1,569,141 $ 73.73 1,643,193 $ 67.98 1,449,683 $ 62.29 Granted 954,075 53.27 708,821 70.14 822,281 63.69 Spin-off — — (319,949 ) 70.56 — — Vested (405,327 ) 54.30 (348,981 ) 74.97 (368,984 ) 63.89 Cancelled (148,639 ) 62.73 (113,943 ) 70.32 (259,787 ) 37.78 Nonvested at end of year 1,969,250 $ 61.53 1,569,141 $ 73.73 1,643,193 $ 67.98 The weighted-average grant day fair value of restricted stock awards and restricted stock units granted during the years ended 2015, 2014 and 2013 was $53.27, $70.14 and $63.69 per share, respectively. There were 405,327; 348,981 and 368,984 restricted stock awards that vested during 2015, 2014 and 2013, respectively. At December 31, 2015, there was approximately $57 million of unrecognized compensation cost related to nonvested restricted stock awards and restricted stock units, which is expected to be recognized over a weighted-average period of two years. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 14. Income Taxes The domestic and foreign components of income before income taxes were as follows (in millions): Years Ended December 31, 2015 2014 2013 Domestic $ (1,577 ) $ 1,415 $ 1,362 Foreign 988 2,079 1,762 $ (589 ) $ 3,494 $ 3,124 The components of the provision for income taxes consisted of (in millions): Years Ended December 31, 2015 2014 2013 Current: Federal $ 30 $ 681 $ 632 State (58 ) 43 55 Foreign 464 615 592 Total current income tax provision 436 1,339 1,279 Deferred: Federal (41 ) (309 ) (157 ) State (38 ) (5 ) (12 ) Foreign (179 ) 14 (167 ) Total deferred income tax benefit (258 ) (300 ) (336 ) Total income tax provision $ 178 $ 1,039 $ 943 The difference between the effective tax rate reflected in the provision for income taxes and the U.S. federal statutory rate was as follows (in millions): Years Ended December 31, 2015 2014 2013 Federal income tax at U.S. statutory rate $ (206 ) $ 1,223 $ 1,093 Foreign income tax rate differential (110 ) (261 ) (216 ) State income tax, net of federal benefit (4 ) 25 27 Nondeductible expenses 528 24 26 Tax benefit of manufacturing deduction (1 ) (37 ) (33 ) Foreign dividends, net of foreign tax credits 28 132 32 Tax rate change on timing differences (45 ) (2 ) (22 ) Change in tax reserve 69 (11 ) (1 ) Prior years taxes (47 ) (11 ) (40 ) Foreign exchange losses (46 ) 28 25 Change in deferred tax valuation allowance 15 (83 ) 40 Other (3 ) 12 12 Total income tax provision $ 178 $ 1,039 $ 943 Significant components of our deferred tax assets and liabilities were as follows (in millions): December 31, 2015 2014 2013 Deferred tax assets: Allowances and operating liabilities $ 491 $ 542 $ 439 Net operating loss carryforwards 170 118 51 Postretirement benefits 79 79 49 Foreign tax credit carryforwards 166 244 300 Other 21 15 39 927 998 878 Valuation allowance for deferred tax assets (63 ) (48 ) (133 ) Total deferred tax assets 864 950 745 Deferred tax liabilities: Tax over book depreciation 277 236 306 Intangible assets 1,323 1,304 1,757 Deferred income 232 257 285 Accrued U.S. tax on unremitted earnings 55 107 92 Other 209 377 164 Total deferred tax liabilities 2,096 2,281 2,604 Net deferred tax liability $ 1,232 $ 1,331 $ 1,859 The balance of unrecognized tax benefits at December 31, 2015 and 2014 was $46 million and $115 million, respectively. Included in the increase in the balance of unrecognized tax benefits for the period ended December 31, 2015 was an uncertain tax position identified in a foreign jurisdiction totaling $69 million, of which the Company has settled and paid $69 million in the period. There was an increase of $14 million of unrecognized tax benefits associated with potential transfer pricing adjustments between foreign jurisdictions and certain operating expenses that may not be deductible in foreign jurisdictions. A $75 million reduction in the balance resulted from the completion of audits in foreign jurisdictions, and an $8 million reduction in the balance resulted from the lapse of applicable statutes of limitations in the U.S. and foreign jurisdictions. Of the decrease of $152 million in the balance of unrecognized tax benefits, $14 million was recorded as a reduction of income tax expense in the current year and is reflected in the “Change in tax reserve” category in the income tax rate schedule above. These unrecognized tax benefits are included in the balance of other liabilities in the Consolidated Balance Sheet at December 31, 2015. If the $46 million of unrecognized tax benefits accrued at December 31, 2015 are ultimately realized, the entire $46 million would be recorded as a reduction of income tax expense. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions): 2015 2014 2013 Unrecognized tax benefit at beginning of year $ 115 $ 127 $ 128 Additions based on tax positions related to the current year 83 3 — Reductions for tax positions of prior years (75 ) — — Settlements of audits (69 ) — — Reductions for lapse of applicable statutes of limitations (8 ) (15 ) (1 ) Unrecognized tax benefit at end of year $ 46 $ 115 $ 127 The Company does not anticipate that the total unrecognized tax benefits will significantly change due to the settlement of audits or the expiration of statutes of limitation within 12 months of this reporting date. To the extent penalties and interest would be assessed on any underpayment of income tax, such accrued amounts have been classified as a component of income tax expense in the financial statements consistent with the Company’s policy. During the year ended December 31, 2015, the Company recorded as an increase of income tax expense a $0.6 million net increase of accrued interest and penalties related to uncertain tax positions. At December 31, 2015, the Company has accrued approximately $3.8 million of interest and penalties relating to unrecognized tax benefits. These interest and penalties are included in the balance of other liabilities in the Consolidated Balance Sheet at December 31, 2015. The Company is subject to taxation in the United States, various states and foreign jurisdictions. The Company has significant operations in the United States, Norway, Canada, the United Kingdom, the Netherlands, France and Denmark. Tax years that remain subject to examination by major tax jurisdictions vary by legal entity, but are generally open in the U.S. for the tax years ending after 2009 and outside the U.S. for the tax years ending after 2008. In the United States, the Company has $21 million of net operating loss carryforwards as of December 31, 2015, of which $5 million will expire in 2020, $1 million will expire in 2024, $13 million will expire in 2025, $1 million will expire in 2026, and $1 million will expire in 2028. The potential benefit of $7 million has been reduced by a $5 million valuation allowance. Future income tax payments will be reduced in the event the Company ultimately realizes the benefit of these net operating losses. If the Company ultimately realizes the benefit of these net operating loss carryforwards, the valuation allowance of $5 million would reduce future income tax expense. Outside the United States, the Company has $765 million of net operating loss carryforwards as of December 31, 2015, of which $9 million will expire in 2016, $34 million will expire in 2017, $31 million will expire in 2018, $5 million will expire in 2019, $20 million will expire in 2020, $20 million will expire in 2021, $6 million will expire in 2022, $9 million will expire in 2023, $208 million will expire in 2024, $67 million will expire in 2025, $4 million will expire in 2034, $43 million will expire in 2035 and $309 million will carry forward indefinitely. The potential benefit of $162 million has been reduced by a $58 million valuation allowance. Future income tax payments will be reduced in the event the Company ultimately realizes the benefit of these net operating losses. If the Company ultimately realizes the benefit of these net operating loss carryforwards, the valuation allowance of $58 million would reduce future income tax expense. Also in the United States, the Company has $166 million of excess foreign tax credits as of December 31, 2015, of which $24 million will expire in 2020 and $142 million will expire in 2022. Undistributed earnings of certain of the Company’s foreign subsidiaries amounted to $8,187 million and $5,874 million at December 31, 2015 and 2014, respectively. Those earnings are considered to be permanently reinvested and no provision for U.S. federal and state income taxes has been made. Distribution of these earnings in the form of dividends or otherwise could result in U.S. federal taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable in various foreign countries. Determination of the amount of unrecognized deferred U.S. income tax liability is not practical; however, unrecognized foreign tax credit carryforwards would be available to reduce some portion of the U.S. liability. Because of the number of tax jurisdictions in which the Company operates, its effective tax rate can fluctuate as operations and the local country tax rates fluctuate. The Company is also subject to audits by federal, state and foreign jurisdictions which may result in proposed assessments. The Company’s future tax provision will reflect any favorable or unfavorable adjustments to its estimated tax liabilities when resolved. The Company is unable to predict the outcome of these matters. However, the Company believes that none of these matters will have a material adverse effect on the results of operations or financial condition of the Company. |
Business Segments and Geographi
Business Segments and Geographic Areas | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Business Segments and Geographic Areas | 15. Business Segments and Geographic Areas The Company’s operations are organized into four reportable segments: Rig Systems, Rig Aftermarket, Wellbore Technologies and Completion & Production Solutions. Within the four reporting segments, the Company has aggregated two business units under Rig Systems, one business unit under Rig Aftermarket, six business units under Wellbore Technologies and six business units under Completion & Production Solutions for a total of 15 business units. The Company has aggregated each of its business units in one of the four reporting segments based on the guidelines of ASC Topic 280, “Segment Reporting” (“ASC Topic 280”). Rig Systems The Company’s Rig Systems segment makes and supports the capital equipment and integrated systems needed to drill oil and gas wells on land and offshore. The segment designs, manufactures and sells land rigs, offshore drilling equipment packages, including installation and commissioning services, and drilling rig components that mechanize and automate the drilling process and rig functionality. Equipment and technologies in Rig Systems include: substructures, derricks, and masts; cranes; pipe lifting, racking, rotating, and assembly systems; fluid transfer technologies, such as mud pumps; pressure control equipment, including blowout preventers; power transmission systems, including drives and generators; and rig instrumentation and control systems. Rig Systems supports land and offshore drillers. Demand for the segment’s products depends on drilling contractors’ and oil and gas companies’ capital spending plans, specifically capital expenditures on rig construction and refurbishment. Rig Aftermarket The Company’s Rig Aftermarket segment provides comprehensive aftermarket products and services to support land and offshore rigs, and drilling rig components manufactured by the Company’s Rig Systems segment. The segment provides spare parts, repair, and rentals as well as technical support, field service and first well support, field engineering, and customer training through a network of aftermarket service and repair facilities strategically located in major areas of drilling operations. Rig Aftermarket supports land and offshore drillers. Demand for the segment’s products and services depends on overall levels of oilfield drilling activity, which drives demand for spare parts, service, and repair for Rig Systems’ large installed base of equipment; and secondarily on drilling contractors’ and oil and gas companies’ capital spending plans, specifically capital expenditures on rig refurbishment and re-certification. Wellbore Technologies The Company’s Wellbore Technologies segment designs, manufactures, rents, and sells a variety of equipment and technologies used to perform drilling operations, and offers services that optimize their performance, including: solids control and waste management equipment and services; drilling fluids; portable power generation; premium drill pipe; wired pipe; drilling optimization and automation services; tubular inspection, repair and coating services; rope access inspection; instrumentation; measuring and monitoring; downhole and fishing tools; steerable technologies; hole openers; and drill bits. Wellbore Technologies focuses on oil and gas companies and supports drilling contractors, oilfield service companies, and oilfield equipment rental companies. Demand for the segment’s products and services depends on the level of oilfield drilling activity by oil and gas companies, drilling contractors, and oilfield service companies. Completion & Production Solutions The Company’s Completion & Production Solutions segment integrates technologies for well completions and oil and gas production. The segment designs, manufactures, and sells equipment and technologies needed for hydraulic fracture stimulation, including pressure pumping trucks, blenders, sanders, hydration units, injection units, flowline, manifolds and wellheads; well intervention, including coiled tubing units, coiled tubing, and wireline units and tools; onshore production, including composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems; and, offshore production, including floating production systems and subsea production technologies. Completion & Production Solutions supports service companies and oil and gas companies. Demand for the segment’s products depends on the level of oilfield completions and workover activity by oilfield service companies and drilling contractors, and capital spending plans by oil and gas companies and oilfield service companies. The Company had revenues of 4%, 7% and 11% of total revenue from one of its customers for the years ended December 31, 2015, 2014, and 2013, respectively. This customer, Samsung Heavy Industries, is a shipyard acting as a general contractor for its customers, who are drillship owners and drilling contractors. This shipyard’s customers have specified that the Company’s drilling equipment be installed on their drillships and have required the shipyard to issue contracts to the Company. Geographic Areas: The following table presents consolidated revenues by country based on sales destination of the use of the products or services (in millions): Years Ended December 31, 2015 2014 2013 United States $ 3,640 $ 6,097 $ 5,140 South Korea 1,835 3,472 3,219 China 1,623 1,905 1,007 Singapore 1,035 1,157 1,850 United Kingdom 634 715 705 Brazil 605 1,299 811 Norway 555 881 1,102 Canada 365 645 625 Other Countries 4,465 5,269 4,762 Total $ 14,757 $ 21,440 $ 19,221 The following table presents long-lived assets by country based on the location (in millions): December 31, 2015 2014 United States $ 1,735 $ 1,818 Brazil 226 290 United Kingdom 163 196 Denmark 128 144 South Korea 102 113 Mexico 93 110 Canada 78 99 Singapore 78 87 Other Countries 521 505 Total $ 3,124 $ 3,362 Business Segments: Rig Rig Wellbore Completion & Eliminations (1) Discontinued Total December 31, 2015: Revenue $ 6,964 $ 2,515 $ 3,718 $ 3,365 $ (1,805 ) $ — $ 14,757 Operating profit (loss) 1,206 605 (1,613 ) 161 (749 ) — (390 ) Capital expenditures 81 10 180 87 95 — 453 Depreciation and amortization 96 30 400 221 — — 747 Goodwill 1,232 877 2,874 1,997 — — 6,980 Total assets 6,772 2,455 8,766 5,916 2,816 — 26,725 December 31, 2014: Revenue $ 9,848 $ 3,222 $ 5,722 $ 4,645 $ (1,997 ) $ — $ 21,440 Operating profit 1,996 882 937 690 (892 ) — 3,613 Capital expenditures 133 12 262 184 108 — 699 Depreciation and amortization 88 27 439 224 — — 778 Goodwill 1,236 877 4,357 2,069 — — 8,539 Total assets 8,052 2,789 11,687 7,072 3,962 — 33,562 December 31, 2013: Revenue $ 8,450 $ 2,692 $ 5,211 $ 4,309 $ (1,441 ) $ — $ 19,221 Operating profit 1,594 729 915 613 (652 ) — 3,199 Capital expenditures 61 24 226 212 91 — 614 Depreciation and amortization 82 26 420 210 — — 738 Goodwill 1,279 906 4,425 2,106 — 333 9,049 Total assets 7,654 2,475 11,862 7,287 3,351 2,183 34,812 (1) Sales from one segment to another generally are priced at estimated equivalent commercial selling prices; however, segments originating an external sale are credited with the full profit to the company. Eliminations include intercompany transactions conducted between the four reporting segments that are eliminated in consolidation. Intercompany transactions within each reporting segment are eliminated within each reporting segment. Also included in the eliminations column are capital expenditures and total assets related to corporate. Corporate assets consist primarily of cash and fixed assets. |
Spin-off of Distribution Busine
Spin-off of Distribution Business | 12 Months Ended |
Dec. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Spin-off of Distribution Business | 16. Spin-off of distribution business On May 30, 2014, the Company completed the previously announced spin-off of its distribution business into an independent public company named NOW Inc., which trades on the New York Stock Exchange under the symbol “DNOW”. After the close of the New York Stock Exchange on May 30, 2014, the stockholders of record as of May 22, 2014 (the “Record Date”) received one share of NOW Inc. common stock for every four shares of NOV common stock held on the Record Date. No fractional shares of NOW Inc. common stock were distributed. Instead, the transfer agent aggregated any fractional shares into whole shares, sold those whole shares in the open market at prevailing rates and distributed the net cash proceeds, after deducting any taxes required to be withheld and any amount equal to all brokerage charges and commissions, pro rata to each holder who would otherwise have been entitled to receive fractional shares in the distribution. Other items incurred as a result of the spin-off were $36 million for the year ended December 31, 2014 and are included in continuing operations. The following table presents selected financial information, through May 30, 2014, regarding the results of operations of our distribution business, which is reported as discontinued operations (in millions): Years Ended 2014 2013 Revenue from discontinued operations $ 1,701 $ 4,296 Income from discontinued operations before income taxes 83 222 Income tax expense 31 75 Income from discontinued operations $ 52 $ 147 Prior to the spin-off, sales to NOW were $231 million for the period ended May 30, 2014 and purchases from NOW were $82 million for the period ended May 30, 2014. Prior to May 30, 2014, the spin-off date, revenue and related cost of revenue were eliminated in consolidation between NOV and NOW. Beginning May 31, 2014, this revenue and cost of revenue represent third-party transactions with NOW. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | 17. Quarterly Financial Data (Unaudited) Summarized quarterly results, were as follows (in millions, except per share data): First Second Third Fourth Year ended December 31, 2015 Revenue $ 4,820 $ 3,909 $ 3,306 $ 2,722 Gross profit 1,177 855 672 359 Income (loss) from continuing operations 313 286 156 (1,522 ) Income from discontinued operations — — — — Net income (loss) attributable to Company 310 289 155 (1,523 ) Per share data: Basic: Income (loss) from continuing operations 0.76 0.75 0.41 (4.06 ) Income from discontinued operations — — — — Net income (loss) attributable to Company 0.76 0.75 0.41 (4.06 ) Diluted: Income (loss) from continuing operations 0.76 0.74 0.41 (4.06 ) Income from discontinued operations — — — — Net income (loss) attributable to Company 0.76 0.74 0.41 (4.06 ) Cash dividends per share 0.46 0.46 0.46 0.46 Year ended December 31, 2014 Revenue $ 4,889 $ 5,255 $ 5,587 $ 5,709 Gross profit 1,290 1,455 1,528 1,536 Income from continuing operations 548 609 701 597 Income from discontinued operations 41 11 — — Net income attributable to Company 589 619 699 595 Per share data: Basic: Income from continuing operations 1.28 1.42 1.63 1.39 Income from discontinued operations 0.10 0.03 — — Net income attributable to Company 1.38 1.45 1.63 1.39 Diluted: Income from continuing operations 1.28 1.42 1.62 1.39 Income from discontinued operations 0.09 0.02 — — Net income attributable to Company 1.37 1.44 1.62 1.39 Cash dividends per share 0.26 0.46 0.46 0.46 |
Schedule II National Oilwell Va
Schedule II National Oilwell Varco, Inc. Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2015 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II National Oilwell Varco, Inc. Valuation and Qualifying Accounts | SCHEDULE II NATIONAL OILWELL VARCO, INC. VALUATION AND QUALIFYING ACCOUNTS Years Ended December 31, 2015, 2014 and 2013 (in millions) Balance Additions Charge Balance Allowance for doubtful accounts: 2015 $ 125 $ 77 $ (43 ) $ 159 2014 132 31 (38 ) 125 2013 120 32 (20 ) 132 Allowance for excess and obsolete inventories: 2015 $ 370 $ 186 $ (56 ) $ 500 2014 396 128 (154 ) 370 2013 338 89 (31 ) 396 Valuation allowance for deferred tax assets: 2015 $ 48 $ 15 $ — $ 63 2014 133 (83 ) (2 ) 48 2013 93 40 — 133 Warranty reserve: 2015 $ 272 $ 92 $ (120 ) $ 244 2014 228 123 (79 ) 272 2013 194 101 (67 ) 228 |
Summary of Significant Accoun27
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of financial instruments including cash and cash equivalents, receivables, and payables approximated fair value because of the relatively short maturity of these instruments. Cash equivalents include only those investments having a maturity date of three months or less at the time of purchase. |
Derivative Financial Instruments | Derivative Financial Instruments Accounting Standards Codification (“ASC”) Topic 815, “Derivatives and Hedging” (“ASC Topic 815”) requires companies to recognize all derivative instruments as either assets or liabilities in the Consolidated Balance Sheet at fair value. The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge, or a hedge of a net investment in a foreign operation. The Company records all derivative financial instruments at their fair value in its Consolidated Balance Sheet. Except for certain non-designated hedges discussed below, all derivative financial instruments that the Company holds are designated as cash flow hedges and are highly effective in offsetting movements in the underlying risks. Such arrangements typically have terms between two and 24 months, but may have longer terms depending on the underlying cash flows being hedged, typically related to the projects in our backlog. |
Inventories | Inventories Inventories consist of raw materials, work-in-process and oilfield and industrial finished products, manufactured equipment and spare parts. Inventories are stated at the lower of cost or market using the first-in, first-out or average cost methods. Allowances for excess and obsolete inventories are determined based on our historical usage of inventory on-hand as well as our future expectations related to our installed base, the development of new products and consideration of current market conditions. The allowance, which totaled $500 million and $370 million at December 31, 2015 and 2014, respectively, is the amount necessary to reduce the cost of the inventory to its estimated net realizable value. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are recorded at cost. Expenditures for major improvements that extend the lives of property and equipment are capitalized while minor replacements, maintenance and repairs are charged to operations as incurred. Disposals are removed at cost less accumulated depreciation with any resulting gain or loss reflected in operations. Depreciation is provided using the straight-line method over the estimated useful lives of individual items. Depreciation expense was $391 million, $413 million and $381 million for the years ended December 31, 2015, 2014 and 2013, respectively. The estimated useful lives of the major classes of property, plant and equipment are included in Note 6 to the consolidated financial statements. We record impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets are impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. The carrying value of assets used in operations that are not recoverable is reduced to fair value if lower than carrying value. In determining the fair market value of the assets, we consider market trends and recent transactions involving sales of similar assets, or when not available, discounted cash flow analysis. There have been no impairments of long-lived assets for the years ended December 31, 2015, 2014 and 2013. |
Intangible Assets | Intangible Assets The Company has approximately $7.0 billion of goodwill and $3.8 billion of identified intangible assets at December 31, 2015. Goodwill is identified by segment as follows (in millions): Rig Rig Wellbore Completion & Discontinued Total Balance at December 31, 2013 $ 1,279 $ 906 $ 4,425 $ 2,106 $ 333 $ 9,049 Goodwill acquired and adjusted during period — — 17 150 — 167 Goodwill disposed of during the period — — — (71 ) (332 ) (403 ) Currency translation adjustments and other (43 ) (29 ) (85 ) (116 ) (1 ) (274 ) Balance at December 31, 2014 $ 1,236 $ 877 $ 4,357 $ 2,069 $ — $ 8,539 Goodwill acquired and adjusted during period — — 8 (8 ) — — Impairment — — (1,485 ) — — (1,485 ) Currency translation adjustments and other (4 ) — (6 ) (64 ) — (74 ) Balance at December 31, 2015 $ 1,232 $ 877 $ 2,874 $ 1,997 $ — $ 6,980 Identified intangible assets with determinable lives consist primarily of customer relationships, trademarks, trade names, patents, and technical drawings acquired in acquisitions, and are being amortized on a straight-line basis over the estimated useful lives of 2-30 years. Amortization expense of identified intangibles is expected to be approximately $340 million in each of the next five years. Included in intangible assets are $384 million of indefinite-lived trade names. The net book values of identified intangible assets are identified by segment as follows (in millions): Rig Rig Wellbore Completion & Discontinued Total Balance at December 31, 2013 $ 232 $ 142 $ 2,999 $ 1,614 $ 68 $ 5,055 Additions to intangible assets — — 5 54 — 59 Disposal of intangible assets — — — (50 ) (67 ) (117 ) Asset impairment — — (104 ) — — (104 ) Amortization (22 ) (6 ) (218 ) (119 ) (1 ) (366 ) Currency translation adjustments and other (2 ) (3 ) (16 ) (62 ) — (83 ) Balance at December 31, 2014 $ 208 $ 133 $ 2,666 $ 1,437 $ — $ 4,444 Additions to intangible assets — — 2 57 — 59 Asset impairment (7 ) — (173 ) (24 ) — (204 ) Amortization (22 ) (6 ) (214 ) (114 ) — (356 ) Currency translation adjustments and other (3 ) (4 ) (27 ) (60 ) — (94 ) Balance at December 31, 2015 $ 176 $ 123 $ 2,254 $ 1,296 $ — $ 3,849 Identified intangible assets by major classification consist of the following (in millions): Gross Accumulated Net Book December 31, 2014: Customer relationships $ 4,094 $ (1,379 ) $ 2,715 Trademarks 871 (226 ) 645 Indefinite-lived trade names 536 — 536 Other 1,058 (510 ) 548 Total identified intangibles $ 6,559 $ (2,115 ) $ 4,444 December 31, 2015: Customer relationships $ 4,016 $ (1,630 ) $ 2,386 Trademarks 880 (265 ) 615 Indefinite-lived trade names 384 — 384 Other 1,040 (576 ) 464 Total identified intangibles $ 6,320 $ (2,471 ) $ 3,849 |
Asset Impairment | Asset Impairment Generally accepted accounting principles require the Company to test goodwill and other indefinite-lived intangible assets for impairment at least annually or more frequently whenever events or circumstances occur indicating that goodwill or other indefinite-lived intangible assets might be impaired. Events or circumstances which could indicate a potential impairment include (but are not limited to) a significant sustained reduction in worldwide oil and gas prices or drilling; a significant sustained reduction in profitability or cash flow of oil and gas companies or drilling contractors; a significant sustained reduction in capital investment by drilling companies and oil and gas companies; or a significant sustained increase in worldwide inventories of oil or gas. The discounted cash flow is based on management’s forecast of operating performance for each reporting unit. The two main assumptions used in measuring goodwill impairment, which bear the risk of change and could impact the Company’s goodwill impairment analysis, include the cash flow from operations from each of the Company’s individual business units and the weighted average cost of capital. The starting point for each of the reporting unit’s cash flow from operations is the detailed annual plan or updated forecast. The detailed planning and forecasting process takes into consideration a multitude of factors including worldwide rig activity, inflationary forces, pricing strategies, customer analysis, operational issues, competitor analysis, capital spending requirements, working capital needs, customer needs to replace aging equipment, increased complexity of drilling, new technology, and existing backlog among other items which impact the individual reporting unit projections. Cash flows beyond the specific operating plans were estimated using a terminal value calculation, which incorporated historical and forecasted financial cyclical trends for each reporting unit and considered long-term earnings growth rates. The financial and credit market volatility directly impacts our fair value measurement through our weighted average cost of capital that we use to determine our discount rate. During times of volatility, significant judgment must be applied to determine whether credit changes are a short-term or long-term trend. During the fourth quarter of 2015, the worldwide average rig count was 2,034 rigs, down 7% from the third quarter 2015 average of 2,188 and down 44% from the fourth quarter 2014 average of 3,632. The fourth quarter 2015 average rig count represented the lowest quarterly average in the past six years. The annual impairment test, as described in ASC Topic 350, “Intangibles—Goodwill and Other” (“ASC Topic 350”), is performed as of October 1 of each year. Based on the Company’s annual impairment test performed in the fourth quarter of 2015, the calculated fair values for all of the Company’s reporting units were in excess of the respective reporting unit’s carrying value, with two exceptions. Two reporting units within the Company’s Wellbore Technologies segment, had a calculated fair value below carrying value, and were required to perform step two resulting in a $1,485 million write-down in goodwill. The implied fair value of goodwill is determined by deducting the fair value of a reporting unit’s identifiable assets and liabilities from the fair value of that reporting unit as a whole. Fair value of the reporting units is determined in accordance with ASC Topic 820 “Fair Value Measurements and Disclosures” using significant unobservable inputs, or level 3 in the fair value hierarchy. These inputs are based on internal management estimates, forecasts and judgments, using discounted cash flow. Other indefinite-lived intangible assets, representing trade names management intends to use indefinitely, were valued using significant unobservable inputs (level 3) and are tested for impairment using the Relief from Royalty Method, a form of the Income Approach. An impairment is measured and recognized based on the amount the book value of the indefinite-lived intangible assets exceeds its estimated fair value as of the date of the impairment test. Included in the impairment test are assumptions, for each trade name, regarding the related revenue streams attributable to the trade names, which are determined in a manner consistent with the forecasting process described above, the royalty rate, and the discount rate applied. Based on the Company’s annual indefinite-lived intangible asset impairment analysis performed during the fourth quarter of 2015, the fair value for all of the Company’s intangible assets with indefinite lives were in excess of the respective asset carrying values, with one exception. This intangible asset, which represents a trade name within the Company’s Wellbore Technologies segment, had a calculated fair value approximately $149 million below its carrying value. In addition, during the third quarter of 2015, the Company incurred $55 million in impairment charges on identified intangible assets with finite lives that were impaired and written off. These impairment charges were primarily the result of the substantial decline in oil prices and worldwide rig counts continuing in the fourth quarter of 2015, declines in forecasts in rig activity, and a decline in the revenue forecast for the Company for 2016. |
Foreign Currency | Foreign Currency The functional currency for most of our foreign operations is the local currency. The cumulative effects of translating the balance sheet accounts from the functional currency into the U.S. dollar at current exchange rates are included in accumulated other comprehensive income (loss). Revenues and expenses are translated at average exchange rates in effect during the period. Certain other foreign operations, including our operations in Norway, use the U.S. dollar as the functional currency. Accordingly, financial statements of these foreign subsidiaries are remeasured to U.S. dollars for consolidation purposes using current rates of exchange for monetary assets and liabilities and historical rates of exchange for nonmonetary assets and related elements of expense. Revenue and expense elements are remeasured at rates that approximate the rates in effect on the transaction dates. For all operations, gains or losses from remeasuring foreign currency transactions into the functional currency are included in income. Net foreign currency transaction gains (losses) were ($47) million, $20 million and ($24) million for the years ending December 31, 2015, 2014 and 2013, respectively, and are included in other income (expense) in the accompanying statement of income. Historically, the Venezuelan government has devalued the country’s currency. During the first quarters of 2015 and 2013, the Venezuelan government again officially devalued the Venezuelan bolivar against the U.S. dollar. As a result, the Company incurred approximately $9 million and $12 million in devaluation charges in the first quarter of 2015 and 2013, respectively. The reporting currency of all of the Company’s Venezuelan entities is the U.S. dollar. The Company’s net remaining investment in Venezuela, which is largely U.S. dollar, was $25 million at December 31, 2015. During the fourth quarter of 2015, the Argentinian government officially devalued the Argentine peso against the U.S. dollar. As a result, the Company incurred approximately $7 million devaluation charges in the fourth quarter of 2015. The reporting currency of all of the Company’s Argentinian entities is the Argentine peso. |
Revenue Recognition | Revenue Recognition The Company’s products and services are sold based upon purchase orders or contracts with the customer that include fixed or determinable prices and that do not generally include right of return or other similar provisions or other significant post delivery obligations. Except for certain construction contracts and drill pipe sales described below, the Company records revenue at the time its manufacturing process is complete, the customer has been provided with all proper inspection and other required documentation, title and risk of loss has passed to the customer, collectability is reasonably assured and the product has been delivered. Customer advances or deposits are deferred and recognized as revenue when the Company has completed all of its performance obligations related to the sale. The Company also recognizes revenue as services are performed. The amounts billed for shipping and handling cost are included in revenue and related costs are included in cost of sales. Revenue Recognition under Long-term Construction Contracts The Company uses the percentage-of-completion method to account for certain long-term construction contracts in the Rig Systems and Completion & Production Solutions segments. These long-term construction contracts include the following characteristics: • the contracts include custom designs for customer specific applications; • the structural design is unique and requires significant engineering efforts; and • construction projects often have progress payments. This method requires the Company to make estimates regarding the total costs of the project, progress against the project schedule and the estimated completion date, all of which impact the amount of revenue and gross margin the Company recognizes in each reporting period. The Company prepares detailed cost estimates at the beginning of each project. Significant projects and their related costs and profit margins are updated and reviewed at least quarterly by senior management. Factors that may affect future project costs and margins include shipyard access, weather, production efficiencies, availability and costs of labor, materials and subcomponents and other factors. These factors can impact the accuracy of the Company’s estimates and materially impact the Company’s current and future reported earnings. The asset, “Costs in excess of billings,” represents revenues recognized in excess of amounts billed. The liability, “Billings in excess of costs,” represents billings in excess of revenues recognized. |
Drill Pipe Sales | Drill Pipe Sales For drill pipe sales, if requested in writing by the customer, delivery may be satisfied through delivery to the Company’s customer storage location or to a third-party storage facility. For sales transactions where title and risk of loss have transferred to the customer but the supporting documentation does not meet the criteria for revenue recognition prior to the products being in the physical possession of the customer, the recognition of the revenues and related inventory costs from these transactions are deferred until the customer takes physical possession. |
Service and Product Warranties | Service and Product Warranties The Company provides service and warranty policies on certain of its products. The Company accrues liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claim experience in accordance with ASC Topic 450 “Contingencies” (“ASC Topic 450”). Adjustments are made to accruals as claim data and historical experience change. In addition, the Company incurs discretionary costs to service its products in connection with product performance issues and accrues for them when they are encountered. The Company monitors the actual cost of performing these discretionary services and adjusts the accrual based on the most current information available. The changes in the carrying amount of service and product warranties are as follows (in millions): Balance at December 31, 2013 $ 228 Net provisions for warranties issued during the year 123 Amounts incurred (78 ) Currency translation adjustments and other (1 ) Balance at December 31, 2014 $ 272 Net provisions for warranties issued during the year 92 Amounts incurred (117 ) Currency translation adjustments and other (3 ) Balance at December 31, 2015 $ 244 |
Income Taxes | Income Taxes The liability method is used to account for income taxes. Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates that will be in effect when the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to amounts which are more likely than not to be realized. |
Concentration of Credit Risk | Concentration of Credit Risk We grant credit to our customers, which operate primarily in the oil and gas industry. Concentrations of credit risk are limited because we have a large number of geographically diverse customers, thus spreading trade credit risk. We control credit risk through credit evaluations, credit limits and monitoring procedures. We perform periodic credit evaluations of our customers’ financial condition and generally do not require collateral, but may require letters of credit for certain international sales. Credit losses are provided for in the financial statements. Allowances for doubtful accounts are determined based on a continuous process of assessing the Company’s portfolio on an individual customer basis taking into account current market conditions and trends. This process consists of a thorough review of historical collection experience, current aging status of the customer accounts, and financial condition of the Company’s customers. Based on a review of these factors, the Company will establish or adjust allowances for specific customers. Accounts receivable are net of allowances for doubtful accounts of approximately $159 million and $125 million at December 31, 2015 and 2014. |
Stock-Based Compensation | Stock-Based Compensation Compensation expense for the Company’s stock-based compensation plans is measured using the fair value method required by ASC Topic 718 “Compensation—Stock Compensation” (“ASC Topic 718”). Under this guidance the fair value of stock option grants and restricted stock is amortized to expense using the straight-line method over the shorter of the vesting period or the remaining employee service period. The Company provides compensation benefits to employees and non-employee directors under share-based payment arrangements, including various employee stock option plans. |
Environmental Liabilities | Environmental Liabilities When environmental assessments or remediations are probable and the costs can be reasonably estimated, remediation liabilities are recorded on an undiscounted basis and are adjusted as further information develops or circumstances change. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect reported and contingent amounts of assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Such estimates include but are not limited to, estimated losses on accounts receivable, estimated costs and related margins of projects accounted for under percentage-of-completion, estimated realizable value on excess and obsolete inventory, contingencies, estimated liabilities for litigation exposures and liquidated damages, estimated warranty costs, estimates related to pension accounting, estimates related to the fair value of reporting units for purposes of assessing goodwill and other indefinite-lived intangible assets for impairment and estimates related to deferred tax assets and liabilities, including valuation allowances on deferred tax assets. Actual results could differ from those estimates. |
Contingencies | Contingencies The Company accrues for costs relating to litigation claims and other contingent matters, including liquidated damage liabilities, when such liabilities become probable and reasonably estimable. In circumstances where the most likely outcome of a contingency can be reasonably estimated, we accrue a liability for that amount. Where the most likely outcome cannot be estimated, a range of potential losses is established and if no one amount in that range is more likely than others, the low end of the range is accrued. Such estimates may be based on advice from third parties or on management’s judgment, as appropriate. Revisions to contingent liabilities are reflected in income in the period in which different facts or information become known or circumstances change that affect the Company’s previous judgments with respect to the likelihood or amount of loss. Amounts paid upon the ultimate resolution of contingent liabilities may be materially different from previous estimates and could require adjustments to the estimated reserves to be recognized in the period such new information becomes known. |
Net Income Attributable to Company Per Share | Net Income Attributable to Company Per Share The following table sets forth the computation of weighted average basic and diluted shares outstanding (in millions, except per share data): Years Ended December 31, 2015 2014 2013 Numerator: Income (loss) from continuing operations $ (769 ) $ 2,450 $ 2,180 Income from discontinued operations $ — $ 52 $ 147 Net income (loss) attributable to Company $ (769 ) $ 2,502 $ 2,327 Denominator: Basic—weighted average common shares outstanding 387 428 426 Dilutive effect of employee stock options and other unvested stock awards — 2 2 Diluted outstanding shares 387 430 428 Per share data: Basic: Income (loss) from continuing operations $ (1.99 ) $ 5.73 $ 5.11 Income from discontinued operations $ — $ 0.12 $ 0.35 Net income (loss) attributable to Company $ (1.99 ) $ 5.85 $ 5.46 Diluted: Income (loss) from continuing operations $ (1.99 ) $ 5.70 $ 5.09 Income from discontinued operations $ — $ 0.12 $ 0.35 Net income (loss) attributable to Company $ (1.99 ) $ 5.82 $ 5.44 Cash dividends per share $ 1.84 $ 1.64 $ 0.91 ASC Topic 260, “Earnings Per Share” (“ASC Topic 260”) requires companies with unvested participating securities to utilize a two-class method for the computation of net income attributable to Company per share. The two-class method requires a portion of net income attributable to Company to be allocated to participating securities, which are unvested awards of share-based payments with non-forfeitable rights to receive dividends or dividend equivalents, if declared. Net income attributable to Company allocated to these participating securities was immaterial for the years ended December 31, 2015, 2014 and 2013 and therefore not excluded from net income attributable to Company per share calculation. The Company had stock options outstanding that were anti-dilutive totaling 13 million, 8 million, and 7 million at December 31, 2015, 2014 and 2013, respectively. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In November 2015, the FASB issued ASU 2015-17 “Balance Sheet Classification of Deferred Taxes” (ASU No. 2015-17), which amends existing guidance on income taxes to require the classification of all deferred tax assets and liabilities as non-current on the balance sheet. ASU No. 2015-17 is effective for fiscal years beginning after December 15, 2017, with early adoption permitted, and the guidance may be applied either prospectively or retrospectively. The Company does not expect the adoption of ASU No. 2015-17 will have a material effect on its consolidated financial position and results of operations. In April 2015, the FASB issued an ASU 2015-03 “ In May 2014, the FASB issued Accounting Standard Update No. 2014-09 “Revenue from Contracts with Customers” (ASU No. 2014-09), which supersedes the revenue recognition requirements in Accounting Standard Codification Topic No. 605 “Revenue Recognition” and most industry-specific guidance. This update requires that entities recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which a company expects to be entitled in exchange for those goods or services. ASU No. 2014-09 is effective for fiscal years beginning after December 15, 2017, and for interim periods within those fiscal years. The Company is currently assessing the impact of the adoption of ASU No. 2014-09 on its consolidated financial position and results of operations. |
Derivatives and Hedging | The Company is exposed to certain risks relating to its ongoing business operations. The primary risk managed by using derivative instruments is foreign currency exchange rate risk. Forward contracts against various foreign currencies are entered into to manage the foreign currency exchange rate risk on forecasted revenues and expenses denominated in currencies other than the functional currency of the operating unit (cash flow hedge). Other forward exchange contracts against various foreign currencies are entered into to manage the foreign currency exchange rate risk associated with certain firm commitments denominated in currencies other than the functional currency of the operating unit (fair value hedge). In addition, the Company will enter into non-designated forward contracts against various foreign currencies to manage the foreign currency exchange rate risk on recognized nonfunctional currency monetary accounts (non-designated hedge). At December 31, 2015, the Company has determined that the fair value of its derivative financial instruments representing assets of $26 million and liabilities of $286 million (primarily currency related derivatives) are determined using level 2 inputs (inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability) in the fair value hierarchy as the fair value is based on publicly available foreign exchange and interest rates at each financial reporting date. At December 31, 2015, the net fair value of the Company’s foreign currency forward contracts totaled a net liability of $260 million. At December 31, 2015, the Company’s financial instruments do not contain any credit-risk-related or other contingent features that could cause accelerated payments when the Company’s financial instruments are in net liability positions. We do not use derivative financial instruments for trading or speculative purposes. Cash Flow Hedging Strategy To protect against the volatility of forecasted foreign currency cash flows resulting from forecasted revenues and expenses, the Company has instituted a cash flow hedging program. The Company hedges portions of its forecasted revenues and expenses denominated in nonfunctional currencies with forward contracts. When the U.S. dollar strengthens against the foreign currencies, the decrease in present value of future foreign currency revenues and expenses is offset by gains in the fair value of the forward contracts designated as hedges. Conversely, when the U.S. dollar weakens, the increase in the present value of future foreign currency cash flows is offset by losses in the fair value of the forward contracts. For derivative instruments that are designated and qualify as a cash flow hedge (i.e., hedging the exposure to variability in expected future cash flows that is subject to a particular currency risk), the effective portion of the gain or loss on the derivative instrument is reported as a component of Other Comprehensive Income (Loss) and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period or periods during which the hedged transaction affects earnings (e.g., in “revenues” when the hedged transactions are cash flows associated with forecasted revenues). The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item, if any (i.e., the ineffective portion), or hedge components excluded from the assessment of effectiveness, is recognized in the Consolidated Statements of Income (Loss) during the current period. |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Goodwill is Identified by Segment | Goodwill is identified by segment as follows (in millions): Rig Rig Wellbore Completion & Discontinued Total Balance at December 31, 2013 $ 1,279 $ 906 $ 4,425 $ 2,106 $ 333 $ 9,049 Goodwill acquired and adjusted during period — — 17 150 — 167 Goodwill disposed of during the period — — — (71 ) (332 ) (403 ) Currency translation adjustments and other (43 ) (29 ) (85 ) (116 ) (1 ) (274 ) Balance at December 31, 2014 $ 1,236 $ 877 $ 4,357 $ 2,069 $ — $ 8,539 Goodwill acquired and adjusted during period — — 8 (8 ) — — Impairment — — (1,485 ) — — (1,485 ) Currency translation adjustments and other (4 ) — (6 ) (64 ) — (74 ) Balance at December 31, 2015 $ 1,232 $ 877 $ 2,874 $ 1,997 $ — $ 6,980 |
Identified Intangible Assets Identified by Segment | The net book values of identified intangible assets are identified by segment as follows (in millions): Rig Rig Wellbore Completion & Discontinued Total Balance at December 31, 2013 $ 232 $ 142 $ 2,999 $ 1,614 $ 68 $ 5,055 Additions to intangible assets — — 5 54 — 59 Disposal of intangible assets — — — (50 ) (67 ) (117 ) Asset impairment — — (104 ) — — (104 ) Amortization (22 ) (6 ) (218 ) (119 ) (1 ) (366 ) Currency translation adjustments and other (2 ) (3 ) (16 ) (62 ) — (83 ) Balance at December 31, 2014 $ 208 $ 133 $ 2,666 $ 1,437 $ — $ 4,444 Additions to intangible assets — — 2 57 — 59 Asset impairment (7 ) — (173 ) (24 ) — (204 ) Amortization (22 ) (6 ) (214 ) (114 ) — (356 ) Currency translation adjustments and other (3 ) (4 ) (27 ) (60 ) — (94 ) Balance at December 31, 2015 $ 176 $ 123 $ 2,254 $ 1,296 $ — $ 3,849 |
Identified Intangible Assets by Major Classification | Identified intangible assets by major classification consist of the following (in millions): Gross Accumulated Net Book December 31, 2014: Customer relationships $ 4,094 $ (1,379 ) $ 2,715 Trademarks 871 (226 ) 645 Indefinite-lived trade names 536 — 536 Other 1,058 (510 ) 548 Total identified intangibles $ 6,559 $ (2,115 ) $ 4,444 December 31, 2015: Customer relationships $ 4,016 $ (1,630 ) $ 2,386 Trademarks 880 (265 ) 615 Indefinite-lived trade names 384 — 384 Other 1,040 (576 ) 464 Total identified intangibles $ 6,320 $ (2,471 ) $ 3,849 |
Changes in Carrying Amount of Service and Product Warranties | The changes in the carrying amount of service and product warranties are as follows (in millions): Balance at December 31, 2013 $ 228 Net provisions for warranties issued during the year 123 Amounts incurred (78 ) Currency translation adjustments and other (1 ) Balance at December 31, 2014 $ 272 Net provisions for warranties issued during the year 92 Amounts incurred (117 ) Currency translation adjustments and other (3 ) Balance at December 31, 2015 $ 244 |
Computation of Weighted Average Basic and Diluted Shares Outstanding | The following table sets forth the computation of weighted average basic and diluted shares outstanding (in millions, except per share data): Years Ended December 31, 2015 2014 2013 Numerator: Income (loss) from continuing operations $ (769 ) $ 2,450 $ 2,180 Income from discontinued operations $ — $ 52 $ 147 Net income (loss) attributable to Company $ (769 ) $ 2,502 $ 2,327 Denominator: Basic—weighted average common shares outstanding 387 428 426 Dilutive effect of employee stock options and other unvested stock awards — 2 2 Diluted outstanding shares 387 430 428 Per share data: Basic: Income (loss) from continuing operations $ (1.99 ) $ 5.73 $ 5.11 Income from discontinued operations $ — $ 0.12 $ 0.35 Net income (loss) attributable to Company $ (1.99 ) $ 5.85 $ 5.46 Diluted: Income (loss) from continuing operations $ (1.99 ) $ 5.70 $ 5.09 Income from discontinued operations $ — $ 0.12 $ 0.35 Net income (loss) attributable to Company $ (1.99 ) $ 5.82 $ 5.44 Cash dividends per share $ 1.84 $ 1.64 $ 0.91 |
Derivative Financial Instrume29
Derivative Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Outstanding Foreign Currency Forward Contracts | The Company had the following outstanding foreign currency forward contracts that were entered into to hedge nonfunctional currency cash flows from forecasted revenues and expenses (in millions): Currency Denomination Foreign Currency December 31, December 31, Norwegian Krone NOK 9,655 NOK 10,781 U.S. Dollar USD 321 USD 231 Euro EUR 78 EUR 462 Danish Krone DKK 57 DKK 227 Singapore Dollar SGD 14 SGD 44 British Pound Sterling GBP 4 GBP 80 Canadian Dollar CAD 2 CAD 14 The Company had the following outstanding foreign currency forward contracts that hedge the fair value of nonfunctional currency monetary accounts (in millions): Currency Denomination Foreign Currency December 31, December 31, Norwegian Krone NOK 2,265 NOK 4,052 Russian Ruble RUB 2,164 RUB — U.S. Dollar USD 515 USD 1,092 Euro EUR 371 EUR 401 Danish Krone DKK 153 DKK 322 British Pound Sterling GBP 11 GBP 19 Canadian Dollar CAD 7 CAD 4 Singapore Dollar SGD 5 SGD 4 Mexican Peso MXN — MXN 118 Brazilian Real BRL — BRL 57 Swedish Krone SEK — SEK 3 |
Derivative Instruments and their Balance Sheet Classifications | The Company has the following fair values of its derivative instruments and their balance sheet classifications (in millions): Fair Values of Derivative Instruments (In millions) Asset Derivatives Liability Derivatives Balance Sheet Location Fair Value December 31, Balance Sheet Location Fair Value December 31, 2015 2014 2015 2014 Derivatives designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 5 $ 18 Accrued liabilities $ 212 $ 204 Foreign exchange contracts Other Assets — 8 Other Liabilities 25 102 Total derivatives designated as hedging instruments under ASC Topic 815 $ 5 $ 26 $ 237 $ 306 Derivatives not designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 21 $ 27 Accrued liabilities $ 49 $ 93 Total derivatives not designated as hedging instruments under ASC Topic 815 $ 21 $ 27 $ 49 $ 93 Total derivatives $ 26 $ 53 $ 286 $ 399 |
Effect of Derivative Instruments on Consolidated Statements of Income (Loss) | The Effect of Derivative Instruments on the Consolidated Statements of Income (Loss) ($ in millions) Derivatives Amount of Gain (Loss) Location of Gain Amount of Gain Location of Gain (Loss) Amount of Gain Years Ended Years Ended Years Ended 2015 2014 2015 2014 2015 2014 Revenue 19 26 Cost of revenue (33 ) (1 ) Foreign exchange contracts (243 ) (340 ) Cost of revenue (262 ) (43 ) Other income (expense), net 4 36 Total (243 ) (340 ) (243 ) (17 ) (29 ) 35 Derivatives Not Location of Gain (Loss) Amount of Gain Years Ended 2015 2014 Foreign exchange contracts Other income (expense), net (97 ) (61 ) Total (97 ) (61 ) (a) The Company expects that $(223) million of the Accumulated Other Comprehensive Income (Loss) will be reclassified into earnings within the next twelve months with an offset by gains from the underlying transactions resulting in no impact to earnings or cash flow. (b) The amount of gain (loss) recognized in income represents $(33) million and $(1) million related to the ineffective portion of the hedging relationships for the years ended December 31, 2015 and 2014, respectively, and $4 million and $36 million related to the amount excluded from the assessment of the hedge effectiveness for the years ended December 31, 2015 and 2014, respectively. |
Acquisitions and Investments (T
Acquisitions and Investments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Estimated Fair Values of Assets Acquired and Liabilities Assumed | The table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition (in millions): 2013 Current assets, net of cash acquired $ 428 Property, plant and equipment 250 Intangible assets 894 Goodwill 1,590 Other assets 49 Total assets acquired 3,211 Current liabilities 186 Deferred taxes 524 Other liabilities 123 Total liabilities 833 Cash consideration, net of cash acquired $ 2,378 |
Summary of Acquisitions | A summary of the acquisitions follows (in millions): Years Ended December 31, 2015 2014 2013 Fair value of assets acquired, net of cash acquired $ 116 $ 406 $ 3,329 Cash paid, net of cash acquired (86 ) (291 ) (2,397 ) Liabilities assumed, debt issued and noncontrolling interest $ 30 $ 115 $ 932 Excess purchase price over fair value of net assets acquired $ 56 $ 167 $ 1,903 |
Inventories, net (Tables)
Inventories, net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consist of (in millions): December 31, 2015 2014 Raw materials and supplies $ 1,069 $ 1,255 Work in process 632 1,027 Finished goods and purchased products 2,977 2,999 Total $ 4,678 $ 5,281 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consist of (in millions): Estimated Useful Lives December 31, 2015 2014 Land and buildings 5-35 Years $ 1,582 $ 1,528 Operating equipment 3-15 Years 3,055 3,060 Rental equipment 3-12 Years 639 817 5,276 5,405 Less: Accumulated Depreciation (2,152 ) (2,043 ) $ 3,124 $ 3,362 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued liabilities consist of (in millions): December 31, 2015 2014 Accrued vendor costs $ 449 $ 815 Customer prepayments and billings 426 703 Fair value of derivatives 261 297 Warranty 244 272 Compensation 241 662 Taxes (non income) 175 211 Insurance 113 126 Accrued commissions 73 97 Interest 8 11 Other 294 324 Total $ 2,284 $ 3,518 |
Costs and Estimated Earnings 34
Costs and Estimated Earnings on Uncompleted Contracts (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Text Block [Abstract] | |
Costs and Estimated Earnings on Uncompleted Contracts | Costs and estimated earnings on uncompleted contracts consist of (in millions): December 31, 2015 2014 Costs incurred on uncompleted contracts $ 9,082 $ 10,442 Estimated earnings 4,080 4,699 13,162 15,141 Less: Billings to date on uncompleted contracts 12,697 15,038 $ 465 $ 103 Costs and estimated earnings in excess of billings on uncompleted contracts $ 1,250 $ 1,878 Billings in excess of costs and estimated earnings on uncompleted contracts (785 ) (1,775 ) $ 465 $ 103 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt consists of (in millions): December 31, 2015 2014 Senior Notes, interest at 6.125% payable semiannually, principal due on August 15, 2015 — 151 Senior Notes, interest at 1.35% payable semiannually, principal due on December 1, 2017 500 500 Senior Notes, interest at 2.6% payable semiannually, principal due on December 1, 2022 1,396 1,396 Senior Notes, interest at 3.95% payable semiannually, principal due on December 1, 2042 1,096 1,096 Commercial paper 893 — Other 45 23 Total debt 3,930 3,166 Less current portion 2 152 Long-term debt $ 3,928 $ 3,014 |
Principal Payments of Debt | Principal payments of debt for years subsequent to 2015 are as follows (in millions): 2016 $ 2 2017 506 2018 898 2019 5 2020 5 Thereafter 2,514 $ 3,930 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Change in Benefit Obligation, Plan Assets and Funded Status of Defined Benefit Pension Plans | The change in benefit obligation, plan assets and the funded status of the defined benefit pension plans in the United States, United Kingdom, Norway, Germany and the Netherlands and defined postretirement plans in the United States, using a measurement date of December 31, 2015 and 2014, is as follows (in millions): Pension benefits Postretirement At year end 2015 2014 2015 2014 Benefit obligation at beginning of year $ 792 $ 846 $ 53 $ 45 Service cost 6 8 — — Interest cost 26 35 3 2 Actuarial loss (gain) (38 ) 116 (7 ) 15 Benefits paid (34 ) (43 ) (5 ) (4 ) Participants contributions — — 1 1 Exchange rate loss (gain) (33 ) (51 ) — — Acquisitions (disposals) — (118 ) — (6 ) Curtailments (16 ) (1 ) — — Other — — 45 — Benefit obligation at end of year $ 703 $ 792 $ 90 $ 53 Fair value of plan assets at beginning of year $ 660 $ 706 $ — $ — Actual return 3 68 — — Benefits paid (34 ) (43 ) (5 ) (4 ) Company contributions 12 21 4 3 Participants contributions — — 1 1 Exchange rate gain (loss) (23 ) (31 ) — — Acquisitions (disposals) (17 ) (61 ) — — Fair value of plan assets at end of year $ 601 $ 660 $ — $ — Funded status $ (102 ) $ (132 ) $ (90 ) $ (53 ) Accumulated benefit obligation at end of year $ 685 $ 764 |
Assumption Rates Used for Benefit Obligations | The assumption rates used for benefit obligations are as follows: Years Ended December 31, 2015 2014 Discount rate: United States plan 3.40% - 3.90% 3.40% - 3.90% International plans 2.10% - 3.60% 2.10% - 3.60% Salary increase: United States plan N/A N/A International plans 2.00% - 4.20% 2.00% - 4.20% |
Assumption Rates Used for Net Periodic Benefit Costs | The assumption rates used for net periodic benefit costs are as follows: Years Ended December 31, 2015 2014 2013 Discount rate: United States plan 3.70% - 4.20% 3.99% - 4.67% 3.80% International plans 2.20% - 3.70% 3.50% - 4.40% 3.46% - 4.40% Salary increase: United States plan N/A N/A N/A International plans 2.00% - 4.20% 2.00% - 4.40% 2.00% - 3.53% Expected return on assets: United States plan 5.50% 6.50% 6.30% International plans 2.30% - 5.12% 3.50% - 5.53% 3.50% - 5.82% |
Plan's Assets Carried at Fair Value | The following table sets forth by level, within the fair value hierarchy, the Plan’s assets carried at fair value (in millions): Fair Value Measurements Total Level 1 Level 2 Level 3 December 31, 2014: Equity securities $ 116 $ — $ 116 $ — Bonds 323 — 323 — Other (insurance contracts) 221 — 113 108 Total Fair Value Measurements $ 660 $ — $ 552 $ 108 December 31, 2015: Equity securities $ 186 $ — $ 186 $ — Bonds 259 — 259 — Other (insurance contracts) 156 — 57 99 Total Fair Value Measurements $ 601 $ — $ 502 $ 99 |
Summary of Changes in Fair Value of Plan's Level Three Assets | The following table sets forth a summary of changes in the fair value of the Plan’s Level 3 assets (in millions): Level 3 Balance at December 31, 2013 $ 107 Actual return on plan assets still held at reporting date 14 Purchases, sales and settlements 5 Currency translation adjustments (18 ) Balance at December 31, 2014 $ 108 Actual return on plan assets still held at reporting date 3 Purchases, sales and settlements 2 Currency translation adjustments (14 ) Balance at December 31, 2015 $ 99 |
Accumulated Other Comprehensi37
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | The components of accumulated other comprehensive income (loss) are as follows (in millions): Currency Derivative Defined Total Balance at December 31, 2012 $ 132 $ 42 $ (67 ) $ 107 Accumulated other comprehensive income (loss) before reclassifications (90 ) (29 ) 48 (71 ) Amounts reclassified from accumulated other comprehensive income (loss) (25 ) (8 ) (7 ) (40 ) Balance at December 31, 2013 $ 17 $ 5 $ (26 ) $ (4 ) Accumulated other comprehensive income (loss) before reclassifications (543 ) (245 ) (59 ) (847 ) Amounts reclassified from accumulated other comprehensive income (loss) 11 12 (6 ) 17 Balance at December 31, 2014 $ (515 ) $ (228 ) $ (91 ) $ (834 ) Accumulated other comprehensive income (loss) before reclassifications (764 ) (176 ) 26 (914 ) Amounts reclassified from accumulated other comprehensive income (loss) — 199 (4 ) 195 Balance at December 31, 2015 $ (1,279 ) $ (205 ) $ (69 ) $ (1,553 ) |
Components of Amounts Reclassified from Accumulated Other Comprehensive Income (Loss) | The components of amounts reclassified from accumulated other comprehensive income (loss) are as follows (in millions): Years Ended December 31, 2015 2014 2013 Currency Derivative Defined Total Currency Derivative Defined Total Currency Derivative Defined Total Revenue $ — $ (19 ) $ — $ (19 ) $ — $ (26 ) $ — $ (26 ) $ — $ (16 ) $ — $ (16 ) Cost of revenue — 295 — 295 — 43 — 43 — 6 — 6 — — — Selling, general, and administrative — — (6 ) (6 ) — — (8 ) (8 ) — — (8 ) (8 ) — Other income (expense), net — — — — 11 — — 11 (25 ) — — (25 ) Tax effect — (77 ) 2 (75 ) — (5 ) 2 (3 ) — 2 1 3 $ — $ 199 $ (4 ) $ 195 $ 11 $ 12 $ (6 ) $ 17 $ (25 ) $ (8 ) $ (7 ) $ (40 ) |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Commitments Under Noncancellable Operating Leases with Initial or Remaining Terms of One Year or More | Future minimum lease commitments under noncancellable operating leases with initial or remaining terms of one year or more at December 31, 2015, are payable as follows (in millions): 2016 $ 202 2017 120 2018 91 2019 71 2020 69 Thereafter 369 Total future lease commitments $ 922 |
Common Stock (Tables)
Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Summary of Stock Options | The following summarizes options activity: Years Ended December 31, 2015 2014 2013 Number of Shares Average Number of Shares Average Number of Shares Average Shares under option at beginning of year 10,881,133 $ 61.22 11,535,566 $ 58.36 10,274,477 $ 54.11 Granted 5,746,153 54.74 3,389,547 69.00 3,072,086 63.96 Spun-off — — (1,567,348 ) 70.56 — — Cancelled (886,356 ) 62.73 (498,967 ) 70.32 (329,002 ) 66.78 Exercised (310,623 ) 22.56 (1,977,665 ) 53.56 (1,481,995 ) 38.75 Shares under option at end of year 15,430,307 $ 59.50 10,881,133 $ 61.22 11,535,566 $ 58.36 Exercisable at end of year 7,498,414 $ 60.30 5,903,712 $ 55.06 6,324,117 $ 49.29 |
Summary of Stock Option Outstanding Information | The following summarizes information about stock options outstanding at December 31, 2015: Range of Exercise Price Weighted-Avg Remaining Contractual Life Options Outstanding Options Exercisable Shares Weighted-Avg Shares Weighted-Avg $12.15 - $55.00 7.34 7,599,928 $ 48.99 2,148,275 $ 34.39 $55.01 - $70.00 7.25 5,045,298 66.22 2,569,643 64.98 $70.01 - $77.99 5.68 2,785,081 76.00 2,780,496 76.00 Total 7.01 15,430,307 $ 59.50 7,498,414 $ 60.30 |
Assumption Used in Determination of Fair Value of Share Based Payment Awards | The use of the Black Scholes model requires the use of extensive actual employee exercise activity data and the use of a number of complex assumptions including expected volatility, risk-free interest rate, expected dividends and expected term. Years Ended December 31, 2015 2014 2013 Valuation Assumptions: Expected volatility 49.1 % 49.4 % 50.1 % Risk-free interest rate 1.5 % 1.5 % 0.9 % Expected dividends $ 3.36 $ 1.39 $ 0.75 Expected term (in years) 3.0 3.7 3.4 |
Summary of Information and Changes in Stock Options with Regard to Stock Option Plans | The following summary presents information regarding outstanding options at December 31, 2015 and changes during 2015 with regard to options under all stock option plans: Shares Weighted- Weighted Aggregate Outstanding at December 31, 2014 10,881,133 $ 61.22 5.15 $ 85,503,217 Granted 5,746,153 $ 54.74 Cancelled (886,356 ) $ 62.73 Exercised (310,623 ) $ 22.56 Outstanding at December 31, 2015 15,430,307 $ 59.50 7.01 $ 5,894,977 Vested or expected to vest 15,229,713 $ 59.50 7.01 $ 5,814,216 Exercisable at December 31, 2015 7,498,414 $ 60.30 5.16 $ 5,894,977 |
Summary of Information Regarding Outstanding Restricted Shares | The following summary presents information regarding outstanding restricted shares: Years Ended December 31, 2015 2014 2013 Number of Units Weighted- Number of Units Weighted- Number of Units Weighted- Nonvested at beginning of year 1,569,141 $ 73.73 1,643,193 $ 67.98 1,449,683 $ 62.29 Granted 954,075 53.27 708,821 70.14 822,281 63.69 Spin-off — — (319,949 ) 70.56 — — Vested (405,327 ) 54.30 (348,981 ) 74.97 (368,984 ) 63.89 Cancelled (148,639 ) 62.73 (113,943 ) 70.32 (259,787 ) 37.78 Nonvested at end of year 1,969,250 $ 61.53 1,569,141 $ 73.73 1,643,193 $ 67.98 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Domestic and Foreign Components of Income Before Income Taxes | The domestic and foreign components of income before income taxes were as follows (in millions): Years Ended December 31, 2015 2014 2013 Domestic $ (1,577 ) $ 1,415 $ 1,362 Foreign 988 2,079 1,762 $ (589 ) $ 3,494 $ 3,124 |
Components of Provision for Income Taxes | The components of the provision for income taxes consisted of (in millions): Years Ended December 31, 2015 2014 2013 Current: Federal $ 30 $ 681 $ 632 State (58 ) 43 55 Foreign 464 615 592 Total current income tax provision 436 1,339 1,279 Deferred: Federal (41 ) (309 ) (157 ) State (38 ) (5 ) (12 ) Foreign (179 ) 14 (167 ) Total deferred income tax benefit (258 ) (300 ) (336 ) Total income tax provision $ 178 $ 1,039 $ 943 |
Difference Between Effective Tax Rate | The difference between the effective tax rate reflected in the provision for income taxes and the U.S. federal statutory rate was as follows (in millions): Years Ended December 31, 2015 2014 2013 Federal income tax at U.S. statutory rate $ (206 ) $ 1,223 $ 1,093 Foreign income tax rate differential (110 ) (261 ) (216 ) State income tax, net of federal benefit (4 ) 25 27 Nondeductible expenses 528 24 26 Tax benefit of manufacturing deduction (1 ) (37 ) (33 ) Foreign dividends, net of foreign tax credits 28 132 32 Tax rate change on timing differences (45 ) (2 ) (22 ) Change in tax reserve 69 (11 ) (1 ) Prior years taxes (47 ) (11 ) (40 ) Foreign exchange losses (46 ) 28 25 Change in deferred tax valuation allowance 15 (83 ) 40 Other (3 ) 12 12 Total income tax provision $ 178 $ 1,039 $ 943 |
Significant Components of Deferred Tax Assets and Liability | Significant components of our deferred tax assets and liabilities were as follows (in millions): December 31, 2015 2014 2013 Deferred tax assets: Allowances and operating liabilities $ 491 $ 542 $ 439 Net operating loss carryforwards 170 118 51 Postretirement benefits 79 79 49 Foreign tax credit carryforwards 166 244 300 Other 21 15 39 927 998 878 Valuation allowance for deferred tax assets (63 ) (48 ) (133 ) Total deferred tax assets 864 950 745 Deferred tax liabilities: Tax over book depreciation 277 236 306 Intangible assets 1,323 1,304 1,757 Deferred income 232 257 285 Accrued U.S. tax on unremitted earnings 55 107 92 Other 209 377 164 Total deferred tax liabilities 2,096 2,281 2,604 Net deferred tax liability $ 1,232 $ 1,331 $ 1,859 |
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions): 2015 2014 2013 Unrecognized tax benefit at beginning of year $ 115 $ 127 $ 128 Additions based on tax positions related to the current year 83 3 — Reductions for tax positions of prior years (75 ) — — Settlements of audits (69 ) — — Reductions for lapse of applicable statutes of limitations (8 ) (15 ) (1 ) Unrecognized tax benefit at end of year $ 46 $ 115 $ 127 |
Business Segments and Geograp41
Business Segments and Geographic Areas (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Revenues by Country Based on Sales Destination of Use of Products or Services | The following table presents consolidated revenues by country based on sales destination of the use of the products or services (in millions): Years Ended December 31, 2015 2014 2013 United States $ 3,640 $ 6,097 $ 5,140 South Korea 1,835 3,472 3,219 China 1,623 1,905 1,007 Singapore 1,035 1,157 1,850 United Kingdom 634 715 705 Brazil 605 1,299 811 Norway 555 881 1,102 Canada 365 645 625 Other Countries 4,465 5,269 4,762 Total $ 14,757 $ 21,440 $ 19,221 |
Long-Lived Assets by Country Based on the Location | The following table presents long-lived assets by country based on the location (in millions): December 31, 2015 2014 United States $ 1,735 $ 1,818 Brazil 226 290 United Kingdom 163 196 Denmark 128 144 South Korea 102 113 Mexico 93 110 Canada 78 99 Singapore 78 87 Other Countries 521 505 Total $ 3,124 $ 3,362 |
Business Segments | Business Segments: Rig Rig Wellbore Completion & Eliminations (1) Discontinued Total December 31, 2015: Revenue $ 6,964 $ 2,515 $ 3,718 $ 3,365 $ (1,805 ) $ — $ 14,757 Operating profit (loss) 1,206 605 (1,613 ) 161 (749 ) — (390 ) Capital expenditures 81 10 180 87 95 — 453 Depreciation and amortization 96 30 400 221 — — 747 Goodwill 1,232 877 2,874 1,997 — — 6,980 Total assets 6,772 2,455 8,766 5,916 2,816 — 26,725 December 31, 2014: Revenue $ 9,848 $ 3,222 $ 5,722 $ 4,645 $ (1,997 ) $ — $ 21,440 Operating profit 1,996 882 937 690 (892 ) — 3,613 Capital expenditures 133 12 262 184 108 — 699 Depreciation and amortization 88 27 439 224 — — 778 Goodwill 1,236 877 4,357 2,069 — — 8,539 Total assets 8,052 2,789 11,687 7,072 3,962 — 33,562 December 31, 2013: Revenue $ 8,450 $ 2,692 $ 5,211 $ 4,309 $ (1,441 ) $ — $ 19,221 Operating profit 1,594 729 915 613 (652 ) — 3,199 Capital expenditures 61 24 226 212 91 — 614 Depreciation and amortization 82 26 420 210 — — 738 Goodwill 1,279 906 4,425 2,106 — 333 9,049 Total assets 7,654 2,475 11,862 7,287 3,351 2,183 34,812 (1) Sales from one segment to another generally are priced at estimated equivalent commercial selling prices; however, segments originating an external sale are credited with the full profit to the company. Eliminations include intercompany transactions conducted between the four reporting segments that are eliminated in consolidation. Intercompany transactions within each reporting segment are eliminated within each reporting segment. Also included in the eliminations column are capital expenditures and total assets related to corporate. Corporate assets consist primarily of cash and fixed assets. |
Spin-off of Distribution Busi42
Spin-off of Distribution Business (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Selected Financial Information Reported as Discontinued Operations | The following table presents selected financial information, through May 30, 2014, regarding the results of operations of our distribution business, which is reported as discontinued operations (in millions): Years Ended 2014 2013 Revenue from discontinued operations $ 1,701 $ 4,296 Income from discontinued operations before income taxes 83 222 Income tax expense 31 75 Income from discontinued operations $ 52 $ 147 |
Quarterly Financial Data (Una43
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Results | Summarized quarterly results, were as follows (in millions, except per share data): First Second Third Fourth Year ended December 31, 2015 Revenue $ 4,820 $ 3,909 $ 3,306 $ 2,722 Gross profit 1,177 855 672 359 Income (loss) from continuing operations 313 286 156 (1,522 ) Income from discontinued operations — — — — Net income (loss) attributable to Company 310 289 155 (1,523 ) Per share data: Basic: Income (loss) from continuing operations 0.76 0.75 0.41 (4.06 ) Income from discontinued operations — — — — Net income (loss) attributable to Company 0.76 0.75 0.41 (4.06 ) Diluted: Income (loss) from continuing operations 0.76 0.74 0.41 (4.06 ) Income from discontinued operations — — — — Net income (loss) attributable to Company 0.76 0.74 0.41 (4.06 ) Cash dividends per share 0.46 0.46 0.46 0.46 Year ended December 31, 2014 Revenue $ 4,889 $ 5,255 $ 5,587 $ 5,709 Gross profit 1,290 1,455 1,528 1,536 Income from continuing operations 548 609 701 597 Income from discontinued operations 41 11 — — Net income attributable to Company 589 619 699 595 Per share data: Basic: Income from continuing operations 1.28 1.42 1.63 1.39 Income from discontinued operations 0.10 0.03 — — Net income attributable to Company 1.38 1.45 1.63 1.39 Diluted: Income from continuing operations 1.28 1.42 1.62 1.39 Income from discontinued operations 0.09 0.02 — — Net income attributable to Company 1.37 1.44 1.62 1.39 Cash dividends per share 0.26 0.46 0.46 0.46 |
Summary of Significant Accoun44
Summary of Significant Accounting Policies - Additional Information (Detail) shares in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015USD ($)RigsReporting_Unit | Sep. 30, 2015USD ($)Rigs | Mar. 31, 2015USD ($) | Mar. 31, 2013USD ($) | Dec. 31, 2015USD ($)Rigsshares | Dec. 31, 2014USD ($)Rigsshares | Dec. 31, 2013USD ($)shares | |
Indefinite-lived Intangible Assets [Line Items] | |||||||
Maturity period of investments description | Three months or less | ||||||
Minimum derivative financial instrument's term (months) | 2 months | ||||||
Maximum derivative financial instrument's term (months) | 24 months | ||||||
Allowances for excess and obsolete inventories | $ 500,000,000 | $ 500,000,000 | $ 370,000,000 | ||||
Depreciation expense related to property, plant and equipment | 391,000,000 | 413,000,000 | $ 381,000,000 | ||||
Impairment of long-lived assets | 0 | 0 | 0 | ||||
Goodwill | 6,980,000,000 | 6,980,000,000 | 8,539,000,000 | 9,049,000,000 | |||
Indefinite-lived intangible assets | 3,849,000,000 | $ 3,849,000,000 | $ 4,444,000,000 | ||||
Estimated useful lives of intangible assets, minimum | 2 years | ||||||
Estimated useful lives of intangible assets, maximum | 30 years | ||||||
Amortization expense | $ 340,000,000 | $ 340,000,000 | |||||
Number of years as first period of amortization | 5 years | ||||||
Worldwide average rig count | Rigs | 2,034 | 2,188 | 2,034 | 3,632 | |||
Change in number of rigs owned from prior quarters | 7.00% | 44.00% | |||||
Impairment of goodwill | $ 1,485,000,000 | ||||||
Impairment charges on identified intangible assets | $ 55,000,000 | ||||||
Net foreign currency transaction gains (losses) | (47,000,000) | $ 20,000,000 | $ (24,000,000) | ||||
Net investment in Venezuela | $ 25,000,000 | 25,000,000 | |||||
Devaluation charges | 7,000,000 | $ 9,000,000 | $ 12,000,000 | ||||
Net allowances for doubtful accounts | 159,000,000 | $ 159,000,000 | $ 125,000,000 | ||||
Anti-dilutive stock options outstanding | shares | 13 | 8 | 7 | ||||
Wellbore Technologies [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Goodwill | $ 2,874,000,000 | $ 2,874,000,000 | $ 4,357,000,000 | $ 4,425,000,000 | |||
Number of reporting units has impairment loss | Reporting_Unit | 2 | ||||||
Impairment of goodwill | $ 1,485,000,000 | 1,485,000,000 | |||||
Indefinite-lived Trade Names [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Indefinite-lived intangible assets | $ 384,000,000 | 384,000,000 | |||||
Other Intangible Assets [Member] | Wellbore Technologies [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Intangible asset impairment | $ 149,000,000 |
Summary of Significant Accoun45
Summary of Significant Accounting Policies - Goodwill is Identified by Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | |
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | $ 8,539 | $ 9,049 | |
Goodwill acquired and adjusted during period | 167 | ||
Goodwill disposed of during the period | (403) | ||
Impairment | (1,485) | ||
Currency translation adjustments and other | (74) | (274) | |
Goodwill, Ending Balance | $ 6,980 | 6,980 | 8,539 |
Discontinued Operations [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 333 | ||
Goodwill disposed of during the period | (332) | ||
Currency translation adjustments and other | (1) | ||
Rig Systems [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 1,236 | 1,279 | |
Currency translation adjustments and other | (4) | (43) | |
Goodwill, Ending Balance | 1,232 | 1,232 | 1,236 |
Rig Aftermarket [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 877 | 906 | |
Currency translation adjustments and other | (29) | ||
Goodwill, Ending Balance | 877 | 877 | 877 |
Wellbore Technologies [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 4,357 | 4,425 | |
Goodwill acquired and adjusted during period | 8 | 17 | |
Impairment | (1,485) | (1,485) | |
Currency translation adjustments and other | (6) | (85) | |
Goodwill, Ending Balance | 2,874 | 2,874 | 4,357 |
Completion & Production Solutions [Member] | |||
Goodwill [Line Items] | |||
Goodwill, Beginning Balance | 2,069 | 2,106 | |
Goodwill acquired and adjusted during period | (8) | 150 | |
Goodwill disposed of during the period | (71) | ||
Currency translation adjustments and other | (64) | (116) | |
Goodwill, Ending Balance | $ 1,997 | $ 1,997 | $ 2,069 |
Summary of Significant Accoun46
Summary of Significant Accounting Policies - Identified Intangible Assets Identified by Segment (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | $ 4,444 | $ 5,055 |
Additions to intangible assets | 59 | 59 |
Disposal of intangible assets | (117) | |
Asset impairment | (204) | (104) |
Amortization | (356) | (366) |
Currency translation adjustments and other | (94) | (83) |
Ending Balance | 3,849 | 4,444 |
Discontinued Operations [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 68 | |
Disposal of intangible assets | (67) | |
Amortization | (1) | |
Rig Systems [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 208 | 232 |
Asset impairment | (7) | |
Amortization | (22) | (22) |
Currency translation adjustments and other | (3) | (2) |
Ending Balance | 176 | 208 |
Rig Aftermarket [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 133 | 142 |
Amortization | (6) | (6) |
Currency translation adjustments and other | (4) | (3) |
Ending Balance | 123 | 133 |
Wellbore Technologies [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 2,666 | 2,999 |
Additions to intangible assets | 2 | 5 |
Asset impairment | (173) | (104) |
Amortization | (214) | (218) |
Currency translation adjustments and other | (27) | (16) |
Ending Balance | 2,254 | 2,666 |
Completion & Production Solutions [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 1,437 | 1,614 |
Additions to intangible assets | 57 | 54 |
Disposal of intangible assets | (50) | |
Asset impairment | (24) | |
Amortization | (114) | (119) |
Currency translation adjustments and other | (60) | (62) |
Ending Balance | $ 1,296 | $ 1,437 |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Identified Intangible Assets by Major Classification (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | $ 6,320 | $ 6,559 | |
Accumulated Amortization | (2,471) | (2,115) | |
Net Book Value | 3,849 | 4,444 | $ 5,055 |
Indefinite-lived Trade Names [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 384 | 536 | |
Net Book Value | 384 | 536 | |
Customer Relationships [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 4,016 | 4,094 | |
Accumulated Amortization | (1,630) | (1,379) | |
Net Book Value | 2,386 | 2,715 | |
Trademarks [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 880 | 871 | |
Accumulated Amortization | (265) | (226) | |
Net Book Value | 615 | 645 | |
Other [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 1,040 | 1,058 | |
Accumulated Amortization | (576) | (510) | |
Net Book Value | $ 464 | $ 548 |
Summary of Significant Accoun48
Summary of Significant Accounting Policies - Changes in Carrying Amount of Service and Product Warranties (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Beginning Balance | $ 272 | $ 228 |
Net provisions for warranties issued during the year | 92 | 123 |
Amounts incurred | (117) | (78) |
Currency translation adjustments and other | (3) | (1) |
Ending Balance | $ 244 | $ 272 |
Summary of Significant Accoun49
Summary of Significant Accounting Policies - Computation of Weighted Average Basic and Diluted Shares Outstanding (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Numerator: | |||||||||||
Income (loss) from continuing operations | $ (1,522) | $ 156 | $ 286 | $ 313 | $ 597 | $ 701 | $ 609 | $ 548 | $ (767) | $ 2,455 | $ 2,181 |
Income from discontinued operations | 11 | 41 | 52 | 147 | |||||||
Net income (loss) attributable to Company | $ (1,523) | $ 155 | $ 289 | $ 310 | $ 595 | $ 699 | $ 619 | $ 589 | $ (769) | $ 2,502 | $ 2,327 |
Denominator: | |||||||||||
Basic-weighted average common shares outstanding | 387 | 428 | 426 | ||||||||
Dilutive effect of employee stock options and other unvested stock awards | 2 | 2 | |||||||||
Diluted outstanding shares | 387 | 430 | 428 | ||||||||
Basic: | |||||||||||
Income (loss) from continuing operations | $ (4.06) | $ 0.41 | $ 0.75 | $ 0.76 | $ 1.39 | $ 1.63 | $ 1.42 | $ 1.28 | $ (1.99) | $ 5.73 | $ 5.11 |
Income from discontinued operations | 0.03 | 0.10 | 0.12 | 0.35 | |||||||
Net income (loss) attributable to Company | (4.06) | 0.41 | 0.75 | 0.76 | 1.39 | 1.63 | 1.45 | 1.38 | (1.99) | 5.85 | 5.46 |
Diluted: | |||||||||||
Income (loss) from continuing operations | (4.06) | 0.41 | 0.74 | 0.76 | 1.39 | 1.62 | 1.42 | 1.28 | (1.99) | 5.70 | 5.09 |
Income from discontinued operations | 0.02 | 0.09 | 0.12 | 0.35 | |||||||
Net income (loss) attributable to Company | (4.06) | 0.41 | 0.74 | 0.76 | 1.39 | 1.62 | 1.44 | 1.37 | (1.99) | 5.82 | 5.44 |
Cash dividends per share | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.26 | $ 1.84 | $ 1.64 | $ 0.91 |
Derivative Financial Instrume50
Derivative Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 26 | $ 53 |
Derivative Liabilities | 286 | $ 399 |
Fair value of the Company's foreign currency forward contracts | 260 | |
Fair Value, Inputs, Level 2 [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 26 | |
Derivative Liabilities | $ 286 |
Derivative Financial Instrume51
Derivative Financial Instruments - Outstanding Foreign Currency Forward Contracts (Detail) - Forward Contracts [Member] € in Millions, £ in Millions, SGD in Millions, SEK in Millions, RUB in Millions, NOK in Millions, MXN in Millions, DKK in Millions, CAD in Millions, BRL in Millions, $ in Millions | Dec. 31, 2015USD ($) | Dec. 31, 2015SGD | Dec. 31, 2015CAD | Dec. 31, 2015DKK | Dec. 31, 2015EUR (€) | Dec. 31, 2015GBP (£) | Dec. 31, 2015NOK | Dec. 31, 2015RUB | Dec. 31, 2014USD ($) | Dec. 31, 2014SEK | Dec. 31, 2014SGD | Dec. 31, 2014BRL | Dec. 31, 2014CAD | Dec. 31, 2014DKK | Dec. 31, 2014EUR (€) | Dec. 31, 2014GBP (£) | Dec. 31, 2014MXN | Dec. 31, 2014NOK |
Derivative [Line Items] | ||||||||||||||||||
Foreign currency, Cash flow hedging | $ 321 | SGD 14 | CAD 2 | DKK 57 | € 78 | £ 4 | NOK 9,655 | $ 231 | SGD 44 | CAD 14 | DKK 227 | € 462 | £ 80 | NOK 10,781 | ||||
Foreign currency, Non-designated hedging | $ 515 | SGD 5 | CAD 7 | DKK 153 | € 371 | £ 11 | NOK 2,265 | RUB 2,164 | $ 1,092 | SEK 3 | SGD 4 | BRL 57 | CAD 4 | DKK 322 | € 401 | £ 19 | MXN 118 | NOK 4,052 |
Derivative Financial Instrume52
Derivative Financial Instruments - Derivative Instruments and their Balance Sheet Classifications (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 26 | $ 53 |
Derivative Liabilities | 286 | 399 |
Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 5 | 26 |
Derivative Liabilities | 237 | 306 |
Not Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 21 | 27 |
Derivative Liabilities | 49 | 93 |
Foreign Exchange Contracts [Member] | Prepaid and Other Current Assets [Member] | Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 5 | 18 |
Foreign Exchange Contracts [Member] | Prepaid and Other Current Assets [Member] | Designated as Hedging Instruments [Member] | Accrued liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 212 | 204 |
Foreign Exchange Contracts [Member] | Prepaid and Other Current Assets [Member] | Not Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 21 | 27 |
Foreign Exchange Contracts [Member] | Prepaid and Other Current Assets [Member] | Not Designated as Hedging Instruments [Member] | Accrued liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 49 | 93 |
Foreign Exchange Contracts [Member] | Other Assets [Member] | Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 8 | |
Foreign Exchange Contracts [Member] | Other Liabilities [Member] | Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | $ 25 | $ 102 |
Derivative Financial Instrume53
Derivative Financial Instruments - Effect of Derivative Instruments on Consolidated Statements of Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | $ 4 | $ 36 |
Not Designated as Hedging Instruments [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives | (97) | (61) |
Cash Flow Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | (243) | (340) |
Foreign Exchange Contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | (243) | (17) |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | (29) | 35 |
Foreign Exchange Contracts [Member] | Cash Flow Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | (243) | (340) |
Foreign Exchange Contracts [Member] | Other Income (Expense), Net [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | 4 | 36 |
Foreign Exchange Contracts [Member] | Other Income (Expense), Net [Member] | Not Designated as Hedging Instruments [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives | (97) | (61) |
Foreign Exchange Contracts [Member] | Cost of Revenue [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | (262) | (43) |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | (33) | (1) |
Foreign Exchange Contracts [Member] | Revenue [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | $ 19 | $ 26 |
Derivative Financial Instrume54
Derivative Financial Instruments - Effect of Derivative Instruments on Consolidated Statements of Income (Loss) (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), reclassified | $ (199) | $ (12) | $ 8 | |
Amount of gain (loss) recognized in income on derivative (ineffective portion) | (33) | (1) | ||
Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) | $ 4 | $ 36 | ||
Scenario, Forecast [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), reclassified | $ (223) |
Acquisitions and Investments -
Acquisitions and Investments - Additional Information (Detail) $ / shares in Units, $ in Millions | Feb. 20, 2013USD ($)$ / shares | Dec. 31, 2015USD ($)Acquisition | Dec. 31, 2014USD ($)Acquisition | Dec. 31, 2013USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Aggregate purchase price of acquisitions | $ 86 | $ 291 | $ 2,397 | |
Goodwill | $ 6,980 | $ 8,539 | $ 9,049 | |
Weighted average life | 5 years | |||
Other Investments [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Aggregate purchase price of acquisitions | $ 19 | |||
Customer Relationships [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets | $ 635 | |||
Weighted average life | 18 years | |||
Patents [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets | $ 170 | |||
Weighted average life | 20 years | |||
Trademarks [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets | $ 86 | |||
Weighted average life | 20 years | |||
Other Intangible Assets [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets | $ 3 | |||
Weighted average life | 1 year | |||
All Other Acquisitions [Member] | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Acquisitions completed | Acquisition | 7 | 10 | ||
Aggregate purchase price of acquisitions | $ 2,378 | $ 86 | $ 291 | |
Intangible assets | $ 894 | 12 | 59 | |
Goodwill | $ 56 | $ 167 | ||
Share holder received in cash per share | $ / shares | $ 60 | |||
Weighted average life | 19 years |
Acquisitions and Investments 56
Acquisitions and Investments - Estimated Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions | Feb. 20, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 56 | $ 167 | $ 1,903 | |
Total assets acquired | 116 | 406 | 3,329 | |
Total liabilities | 30 | 115 | $ 932 | |
All Other Acquisitions [Member] | ||||
Business Acquisition [Line Items] | ||||
Current assets, net of cash acquired | $ 428 | |||
Property, plant and equipment | 250 | |||
Intangible assets | 894 | $ 12 | $ 59 | |
Goodwill | 1,590 | |||
Other assets | 49 | |||
Total assets acquired | 3,211 | |||
Current liabilities | 186 | |||
Deferred taxes | 524 | |||
Other liabilities | 123 | |||
Total liabilities | 833 | |||
Cash consideration, net of cash acquired | $ 2,378 |
Acquisitions and Investments 57
Acquisitions and Investments - Summary of Acquisitions (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Business Combinations [Abstract] | |||
Fair value of assets acquired, net of cash acquired | $ 116 | $ 406 | $ 3,329 |
Cash paid, net of cash acquired | (86) | (291) | (2,397) |
Liabilities assumed, debt issued and noncontrolling interest | 30 | 115 | 932 |
Excess purchase price over fair value of net assets acquired | $ 56 | $ 167 | $ 1,903 |
Inventories, net - Inventories
Inventories, net - Inventories (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 1,069 | $ 1,255 |
Work in process | 632 | 1,027 |
Finished goods and purchased products | 2,977 | 2,999 |
Total | $ 4,678 | $ 5,281 |
Property, Plant and Equipment -
Property, Plant and Equipment - Property, Plant and Equipment (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 5,276 | $ 5,405 |
Less: Accumulated Depreciation | (2,152) | (2,043) |
Property, plant and equipment, net | 3,124 | 3,362 |
Land and Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 1,582 | 1,528 |
Estimated Useful Lives | 5-35 Years | |
Operating Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 3,055 | 3,060 |
Estimated Useful Lives | 3-15 Years | |
Rental Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 639 | $ 817 |
Estimated Useful Lives | 3-12 Years |
Accrued Liabilities - Accrued L
Accrued Liabilities - Accrued Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Payables and Accruals [Abstract] | |||
Accrued vendor costs | $ 449 | $ 815 | |
Customer prepayments and billings | 426 | 703 | |
Fair value of derivatives | 261 | 297 | |
Warranty | 244 | 272 | $ 228 |
Compensation | 241 | 662 | |
Taxes (non income) | 175 | 211 | |
Insurance | 113 | 126 | |
Accrued commissions | 73 | 97 | |
Interest | 8 | 11 | |
Other | 294 | 324 | |
Total | $ 2,284 | $ 3,518 |
Costs and Estimated Earnings 61
Costs and Estimated Earnings on Uncompleted Contracts - Costs and Estimated Earnings on Uncompleted Contracts (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Contractors [Abstract] | ||
Costs incurred on uncompleted contracts | $ 9,082 | $ 10,442 |
Estimated earnings | 4,080 | 4,699 |
Costs and estimated earnings on uncompleted contracts, Gross | 13,162 | 15,141 |
Less: Billings to date on uncompleted contracts | 12,697 | 15,038 |
Total net estimate billing on uncompleted contracts | 465 | 103 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 1,250 | 1,878 |
Billings in excess of costs and estimated earnings on uncompleted contracts | (785) | (1,775) |
Total net estimate billing on uncompleted contracts | $ 465 | $ 103 |
Debt - Debt (Detail)
Debt - Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Other | $ 45 | $ 23 |
Total debt | 3,930 | 3,166 |
Less current portion | 2 | 152 |
Long-term debt | 3,928 | 3,014 |
Total debt | 3,930 | 3,166 |
Five-year Unsecured Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Commercial paper | 893 | |
Senior Notes, Interest at 6.125% Payable Semiannually, Principal Due on August 15, 2015 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | 151 | |
Senior Notes, Interest at 1.35% Payable Semiannually, Principal Due on December 1, 2017 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | 500 | 500 |
Senior Notes, Interest at 2.6% Payable Semiannually, Principal Due on December 1, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | 1,396 | 1,396 |
Senior Notes, Interest at 3.95% Payable Semiannually, Principal Due on December 1, 2042 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | $ 1,096 | $ 1,096 |
Debt - Debt (Parenthetical) (De
Debt - Debt (Parenthetical) (Detail) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Aug. 15, 2015 | |
Senior Notes, Interest at 6.125% Payable Semiannually, Principal Due on August 15, 2015 [Member] | |||
Debt Instrument [Line Items] | |||
Senior notes interest rate | 6.125% | 6.125% | 6.125% |
Senior note due date | Aug. 15, 2015 | Aug. 15, 2015 | |
Senior Notes, Interest at 1.35% Payable Semiannually, Principal Due on December 1, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Senior notes interest rate | 1.35% | 1.35% | |
Senior note due date | Dec. 1, 2017 | Dec. 1, 2017 | |
Senior Notes, Interest at 2.6% Payable Semiannually, Principal Due on December 1, 2022 [Member] | |||
Debt Instrument [Line Items] | |||
Senior notes interest rate | 2.60% | 2.60% | |
Senior note due date | Dec. 1, 2022 | Dec. 1, 2022 | |
Senior Notes, Interest at 3.95% Payable Semiannually, Principal Due on December 1, 2042 [Member] | |||
Debt Instrument [Line Items] | |||
Senior notes interest rate | 3.95% | 3.95% | |
Senior note due date | Dec. 1, 2042 | Dec. 1, 2042 |
Debt - Principal Payments of De
Debt - Principal Payments of Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Disclosure [Abstract] | ||
2,016 | $ 2 | |
2,017 | 506 | |
2,018 | 898 | |
2,019 | 5 | |
2,020 | 5 | |
Thereafter | 2,514 | |
Total debt | $ 3,930 | $ 3,166 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | Aug. 15, 2015 | Jun. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||||
Letter of credit issued under credit facility | $ 0 | |||
Funds available under revolving credit facility | $ 3,607,000,000 | |||
Interest rate under multi currency facility | LIBOR, NIBOR or EURIBOR plus 0.875% | |||
Outstanding letters of credit under various bilateral committed letter of credit facilities | $ 2,378,000,000 | |||
Fair value of Unsecured Senior Notes | 2,551,000,000 | $ 2,974,000,000 | ||
Carrying value of Unsecured Senior Notes | $ 3,930,000,000 | $ 3,166,000,000 | ||
Commercial Paper Program [Member] | ||||
Debt Instrument [Line Items] | ||||
Variable rate | 0.875% | |||
Variable rate basis | LIBOR, NIBOR or EURIBOR plus | |||
Senior Notes, Interest at 6.125% Payable Semiannually, Principal Due on August 15, 2015 [Member] | ||||
Debt Instrument [Line Items] | ||||
Repayments on senior notes | $ 151,000,000 | |||
Senior notes interest rate | 6.125% | 6.125% | 6.125% | |
Five-year Unsecured Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Unsecured revolving credit facility, borrowing capacity | $ 4,500,000,000 | |||
Unsecured revolving credit facility, increased amount | $ 1,000,000,000 | |||
Borrowings under commercial paper | $ 893,000,000 | |||
Unsecured Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, Period | 5 years | |||
Unsecured Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Carrying value of Unsecured Senior Notes | $ 2,992,000,000 | $ 3,143,000,000 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($)Employees | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Compensation Related Costs Disclosure [Line Items] | |||
Expenses for defined-contribution plans | $ 95 | $ 115 | $ 96 |
Net periodic benefit cost | 5 | $ 7 | $ 10 |
Defined benefit plan, expected future benefit payments in year five | $ 35 | ||
Expected years of defined benefit plans | 5 years | ||
Expected future benefit amounts to pay, total | $ 370 | ||
United States [Member] | |||
Compensation Related Costs Disclosure [Line Items] | |||
Number of U.S retirees and spouses participate in defined benefit health care plans | Employees | 1,900 | ||
Number of U.S. employees participate in defined benefit health care plans | Employees | 75 | ||
Norway [Member] | |||
Compensation Related Costs Disclosure [Line Items] | |||
Number of active employees participate in defined benefit plan | Employees | 300 |
Employee Benefit Plans - Change
Employee Benefit Plans - Change in Benefit Obligation, Plan Assets and Funded Status of Defined Benefit Pension Plans (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets at beginning of year | $ 660 | |
Fair value of plan assets at end of year | 601 | $ 660 |
Pension Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Benefit obligation at beginning of year | 792 | 846 |
Service cost | 6 | 8 |
Interest cost | 26 | 35 |
Actuarial loss (gain) | (38) | 116 |
Benefits paid | (34) | (43) |
Exchange rate loss (gain) | (33) | (51) |
Acquisitions (disposals) | (118) | |
Curtailments | (16) | (1) |
Benefit obligation at end of year | 703 | 792 |
Fair value of plan assets at beginning of year | 660 | 706 |
Actual return | 3 | 68 |
Benefits paid | (34) | (43) |
Company contributions | 12 | 21 |
Exchange rate gain (loss) | (23) | (31) |
Acquisitions (disposals) | (17) | (61) |
Fair value of plan assets at end of year | 601 | 660 |
Funded status | (102) | (132) |
Accumulated benefit obligation at end of year | 685 | 764 |
Postretirement Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Benefit obligation at beginning of year | 53 | 45 |
Interest cost | 3 | 2 |
Actuarial loss (gain) | (7) | 15 |
Benefits paid | (5) | (4) |
Participants contributions | 1 | 1 |
Acquisitions (disposals) | (6) | |
Other | 45 | |
Benefit obligation at end of year | 90 | 53 |
Benefits paid | (5) | (4) |
Company contributions | 4 | 3 |
Participants contributions | 1 | 1 |
Funded status | $ (90) | $ (53) |
Employee Benefit Plans - Assump
Employee Benefit Plans - Assumption Rates Used for Benefit Obligations (Detail) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
United States Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate minimum | 3.40% | 3.40% |
Discount rate maximum | 3.90% | 3.90% |
International Plans [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate minimum | 2.10% | 2.10% |
Discount rate maximum | 3.60% | 3.60% |
Salary increase minimum | 2.00% | 2.00% |
Salary increase maximum | 4.20% | 4.20% |
Employee Benefit Plans - Assu69
Employee Benefit Plans - Assumption Rates Used for Net Periodic Benefit Costs (Detail) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
United States Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate: | 3.80% | ||
Discount rate minimum | 3.70% | 3.99% | |
Discount rate maximum | 4.20% | 4.67% | |
Expected return on assets | 5.50% | 6.50% | 6.30% |
International Plans [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate minimum | 2.20% | 3.50% | 3.46% |
Discount rate maximum | 3.70% | 4.40% | 4.40% |
Salary increase minimum | 2.00% | 2.00% | 2.00% |
Salary increase maximum | 4.20% | 4.40% | 3.53% |
Expected return on assets, minimum | 2.30% | 3.50% | 3.50% |
Expected return on assets, maximum | 5.12% | 5.53% | 5.82% |
Employee Benefit Plans - Plan's
Employee Benefit Plans - Plan's Assets Carried at Fair Value (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | $ 601 | $ 660 | |
Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 186 | 116 | |
Bonds [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 259 | 323 | |
Other Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 156 | 221 | |
Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 502 | 552 | |
Fair Value, Inputs, Level 2 [Member] | Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 186 | 116 | |
Fair Value, Inputs, Level 2 [Member] | Bonds [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 259 | 323 | |
Fair Value, Inputs, Level 2 [Member] | Other Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 57 | 113 | |
Fair Value, Inputs, Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 99 | 108 | $ 107 |
Fair Value, Inputs, Level 3 [Member] | Other Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | $ 99 | $ 108 |
Employee Benefit Plans - Summar
Employee Benefit Plans - Summary of Changes in Fair Value of Plan's Level Three Assets (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets at beginning of year | $ 660 | |
Fair value of plan assets at end of year | 601 | $ 660 |
Fair Value, Inputs, Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets at beginning of year | 108 | 107 |
Actual return on plan assets still held at reporting date | 3 | 14 |
Purchases, sales and settlements | 2 | 5 |
Currency translation adjustments | (14) | (18) |
Fair value of plan assets at end of year | $ 99 | $ 108 |
Accumulated Other Comprehensi72
Accumulated Other Comprehensive Income (Loss) - Components of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | $ (834) | $ (4) | $ 107 |
Accumulated other comprehensive income (loss) before reclassifications | (914) | (847) | (71) |
Amounts reclassified from accumulated other comprehensive income (loss) | 195 | 17 | (40) |
Accumulated other comprehensive income (loss), Ending balance | (1,553) | (834) | (4) |
Currency Translation Adjustments [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | (515) | 17 | 132 |
Accumulated other comprehensive income (loss) before reclassifications | (764) | (543) | (90) |
Amounts reclassified from accumulated other comprehensive income (loss) | 11 | (25) | |
Accumulated other comprehensive income (loss), Ending balance | (1,279) | (515) | 17 |
Derivative Financial Instruments, Net of Tax [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | (228) | 5 | 42 |
Accumulated other comprehensive income (loss) before reclassifications | (176) | (245) | (29) |
Amounts reclassified from accumulated other comprehensive income (loss) | 199 | 12 | (8) |
Accumulated other comprehensive income (loss), Ending balance | (205) | (228) | 5 |
Defined Benefit Plans, Net of Tax [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | (91) | (26) | (67) |
Accumulated other comprehensive income (loss) before reclassifications | 26 | (59) | 48 |
Amounts reclassified from accumulated other comprehensive income (loss) | (4) | (6) | (7) |
Accumulated other comprehensive income (loss), Ending balance | $ (69) | $ (91) | $ (26) |
Accumulated Other Comprehensi73
Accumulated Other Comprehensive Income (Loss) - Components of Amounts Reclassified from Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | $ 11 | $ (25) | |
Derivative Financial Instruments | $ 199 | 12 | (8) |
Defined Benefit Plans | (4) | (6) | (7) |
Total | 195 | 17 | (40) |
Tax Effect [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Derivative Financial Instruments | (77) | (5) | 2 |
Defined Benefit Plans | 2 | 2 | 1 |
Total | (75) | (3) | 3 |
Revenue [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Derivative Financial Instruments | (19) | (26) | (16) |
Total | (19) | (26) | (16) |
Cost of Revenue [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Derivative Financial Instruments | 295 | 43 | 6 |
Total | 295 | 43 | 6 |
Selling, General, and Administrative [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Defined Benefit Plans | (6) | (8) | (8) |
Total | $ (6) | (8) | (8) |
Other Income (Expense), Net [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | 11 | (25) | |
Total | $ 11 | $ (25) |
Accumulated Other Comprehensi74
Accumulated Other Comprehensive Income (Loss) - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Statement of Comprehensive Income [Abstract] | |||
Net increase to other comprehensive income or loss upon the translation | $ (764) | $ (532) | $ (115) |
Currency translation gains reclassified from accumulated other comprehensive income (loss) | (11) | 25 | |
Changes in derivative financial instruments, net of tax | 23 | (233) | (37) |
Changes in derivative financial instruments, tax | $ 14 | $ 89 | $ 18 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015USD ($)Rigs | Dec. 31, 2014USD ($)Rigs | Dec. 31, 2013USD ($) | Sep. 30, 2015Rigs | |
Commitment And Contingencies [Line Items] | ||||
Remaining number of wells | Rigs | 2,034 | 3,632 | 2,188 | |
Rental expense related to operating leases | $ 327 | $ 390 | $ 336 | |
Brazil [Member] | ||||
Commitment And Contingencies [Line Items] | ||||
Reduction in Rig Systems segment backlog, due to contract termination | (1,200) | |||
Remaining revenue backlog | $ 1,800 | |||
Remaining number of wells | Rigs | 15 |
Commitments and Contingencies76
Commitments and Contingencies - Future Minimum Lease Commitments Under Noncancellable Operating Leases with Initial or Remaining Terms of One Year or More (Detail) $ in Millions | Dec. 31, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,016 | $ 202 |
2,017 | 120 |
2,018 | 91 |
2,019 | 71 |
2,020 | 69 |
Thereafter | 369 |
Total future lease commitments | $ 922 |
Common Stock - Additional Infor
Common Stock - Additional Information (Detail) - USD ($) | Aug. 28, 2015 | May. 13, 2015 | Feb. 25, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of common stock, authorized | 1,000,000,000 | 1,000,000,000 | |||||
Number of preferred stock, authorized | 10,000,000 | ||||||
Common stock, par value | $ 0.01 | $ 0.01 | |||||
Preferred stock, par value | $ 0.01 | ||||||
Preferred stock, shares issued | 0 | ||||||
Preferred stock, shares outstanding | 0 | ||||||
Aggregated cash dividends paid | $ 710,000,000 | $ 703,000,000 | $ 389,000,000 | ||||
Share repurchase program, authorized amount | $ 3,000,000,000 | ||||||
Common stock repurchased (Treasury stock) | 44,000,000 | 11,600,000 | |||||
Common stock repurchased, average price per share | $ 50.53 | $ 66.97 | |||||
Common stock repurchased, aggregate amount | $ 2,221,000,000 | $ 779,000,000 | |||||
Compensation cost charged against income for share-based compensation arrangements | 109,000,000 | 101,000,000 | 92,000,000 | ||||
Income tax benefit recognized for share-based compensation arrangements | $ 28,000,000 | $ 35,000,000 | $ 28,000,000 | ||||
Earlier authorized shares under stock based compensation | 39,500,000 | ||||||
Duration of performance-based restricted stock awards, vested | Option plan generally vest over a three-year period starting one year from the date of grant and expire ten years from the date of grant. | ||||||
Remaining shares available for future grants under the Plan | 6,200,000 | ||||||
Stock option, Minimum Range | $ 12.15 | ||||||
Stock option, Maximum Range | 77.99 | ||||||
Weighted-average fair value of options granted | $ 15.41 | $ 25.60 | $ 24.11 | ||||
Total intrinsic value of options exercised | $ 9,000,000 | $ 111,000,000 | |||||
Total unrecognized compensation cost related to nonvested stock options | $ 95,000,000 | ||||||
Weighted-average period recognition of unrecognized compensation cost related to nonvested RSA's | 2 years | ||||||
Total fair value of stock options vested | $ 72,000,000 | 67,000,000 | $ 64,000,000 | ||||
Cash received from option exercises | 7,000,000 | 108,000,000 | 58,000,000 | ||||
Tax benefit realized for the tax deductions from option exercises | $ 7,000,000 | $ 44,000,000 | $ 39,000,000 | ||||
Restricted stock granted | 954,075 | 708,821 | 822,281 | ||||
Restricted stock granted fair value | $ 53.27 | $ 70.14 | $ 63.69 | ||||
Description of performance goal | Performance against the ROC goal is determined by comparing the performance of the Company's actual ROC performance average for each of the three years of the performance period against the ROC goal set by the Company's Compensation Committee. | ||||||
Total number of restricted stock awards and restricted stock units granted | 405,327 | 348,981 | 368,984 | ||||
Restricted Stock and Restricted Stock Units [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock granted | 653,750 | ||||||
Restricted stock granted fair value | $ 54.74 | ||||||
TSR Award [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Performance based restricted stock awards granted in percent | 50.00% | ||||||
ROC Award [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Performance based restricted stock awards granted in percent | 50.00% | ||||||
Restricted Stock Awards [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Duration of performance-based restricted stock awards, vested | The stock options vest over a three-year period from the grant date while the restricted stock and restricted stock units vest on the third anniversary of the date of grant. | ||||||
Total unrecognized compensation cost related to nonvested stock options | $ 57,000,000 | ||||||
Weighted-average period recognition of unrecognized compensation cost related to nonvested RSA's | 2 years | ||||||
Restricted stock granted | 75,000 | 26,992 | |||||
Restricted stock granted fair value | $ 41.65 | $ 51.88 | $ 53.27 | $ 70.14 | $ 63.69 | ||
Performance based restricted stock awards vested, number of years | 3 years | 3 years | |||||
Total number of restricted stock awards and restricted stock units granted | 405,327 | 348,981 | 368,984 | ||||
Minimum [Member] | Performance-base restricted stock [Member] | Senior Management Employees [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock granted | 0 | ||||||
Maximum [Member] | Performance-base restricted stock [Member] | Senior Management Employees [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock granted | 396,666 |
Common Stock - Summary of Stock
Common Stock - Summary of Stock Options (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Number of shares under stock option, Beginning of the year | 10,881,133 | 11,535,566 | 10,274,477 |
Number of Shares Granted | 5,746,153 | 3,389,547 | 3,072,086 |
Number of Shares Spun-off | (1,567,348) | ||
Number of Shares Cancelled | (886,356) | (498,967) | (329,002) |
Number of Shares Exercised | (310,623) | (1,977,665) | (1,481,995) |
Number of shares under stock option, End of the year | 15,430,307 | 10,881,133 | 11,535,566 |
Number of stock options vested and expected to be vest, exercisable | 7,498,414 | 5,903,712 | 6,324,117 |
Weighted Average Exercise Price, Beginning of year | $ 61.22 | $ 58.36 | $ 54.11 |
Weighted Average Exercise Price, Stock Options Granted | 54.74 | 69 | 63.96 |
Weighted Average Exercise Price, Stock Options Spun off | 70.56 | ||
Weighted Average Exercise Price, Stock Options Canceled | 62.73 | 70.32 | 66.78 |
Weighted Average Exercise Price, Stock Options Exercised | 22.56 | 53.56 | 38.75 |
Weighted Average Exercise Price, End of the year | 59.50 | 61.22 | 58.36 |
Weighted Average Exercise Price, Stock Options Exercisable | $ 60.30 | $ 55.06 | $ 49.29 |
Common Stock - Summary of Sto79
Common Stock - Summary of Stock Option Outstanding Information (Detail) | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Weighted-Avg Remaining Contractual Life | 7 years 4 days |
Stock Options Outstanding, Shares | shares | 15,430,307 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 59.50 |
Stock Options Exercisable, Shares | shares | 7,498,414 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 60.30 |
Stock option, Minimum Range | 12.15 |
Stock option, Maximum Range | $ 77.99 |
Range One [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Weighted-Avg Remaining Contractual Life | 7 years 4 months 2 days |
Stock Options Outstanding, Shares | shares | 7,599,928 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 48.99 |
Stock Options Exercisable, Shares | shares | 2,148,275 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 34.39 |
Stock option, Minimum Range | 12.15 |
Stock option, Maximum Range | $ 55 |
Range Two [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Weighted-Avg Remaining Contractual Life | 7 years 3 months |
Stock Options Outstanding, Shares | shares | 5,045,298 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 66.22 |
Stock Options Exercisable, Shares | shares | 2,569,643 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 64.98 |
Stock option, Minimum Range | 55.01 |
Stock option, Maximum Range | $ 70 |
Range Three [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Weighted-Avg Remaining Contractual Life | 5 years 8 months 5 days |
Stock Options Outstanding, Shares | shares | 2,785,081 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 76 |
Stock Options Exercisable, Shares | shares | 2,780,496 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 76 |
Stock option, Minimum Range | 70.01 |
Stock option, Maximum Range | $ 77.99 |
Common Stock - Assumption Used
Common Stock - Assumption Used in Determination of Fair Value of Share Based Payment Awards (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Expected volatility | 49.10% | 49.40% | 50.10% |
Risk-free interest rate | 1.50% | 1.50% | 0.90% |
Expected dividends | $ 3,360 | $ 1,390 | $ 750 |
Expected term (in years) | 3 years | 3 years 8 months 12 days | 3 years 4 months 24 days |
Common Stock - Summary of Infor
Common Stock - Summary of Information and Changes in Stock Options with Regard to Stock Option Plans (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Number of shares under stock option, Beginning of the year | 10,881,133 | 11,535,566 | 10,274,477 |
Number of Shares Granted | 5,746,153 | 3,389,547 | 3,072,086 |
Number of Shares Cancelled | (886,356) | (498,967) | (329,002) |
Number of Shares Exercised | (310,623) | (1,977,665) | (1,481,995) |
Number of shares under stock option, End of the year | 15,430,307 | 10,881,133 | 11,535,566 |
Number of stock options, Vested or expected to vest | 15,229,713 | ||
Number of stock options, Exercisable | 7,498,414 | 5,903,712 | 6,324,117 |
Weighted Average Exercise Price, Beginning of year | $ 61.22 | $ 58.36 | $ 54.11 |
Weighted Average Exercise Price, Stock Options Granted | 54.74 | 69 | 63.96 |
Weighted Average Exercise Price, Stock Options Cancelled | 62.73 | 70.32 | 66.78 |
Weighted Average Exercise Price, Stock Options Exercised | 22.56 | 53.56 | 38.75 |
Weighted Average Exercise Price, End of the year | 59.50 | 61.22 | 58.36 |
Weighted Average Exercise Price, Stock options vested or expected to vest | 59.50 | ||
Weighted Average Exercise Price, Stock Options, Exercisable | $ 60.30 | $ 55.06 | $ 49.29 |
Weighted Average Remaining Contractual Term, Outstanding | 7 years 4 days | 5 years 1 month 24 days | |
Weighted Average Remaining Contractual Term, Vested | 7 years 4 days | ||
Weighted Average Remaining Contractual Term, Exercisable | 5 years 1 month 28 days | ||
Stock Options Aggregate Intrinsic Value, Beginning | $ 85,503,217 | ||
Stock Options Aggregate Intrinsic Value, Ending | 5,894,977 | $ 85,503,217 | |
Stock Options Average Aggregate Intrinsic Value, Vested or expected to Vest | 5,814,216 | ||
Stock Options Average Aggregate Intrinsic Value, Exercisable | $ 5,894,977 |
Common Stock - Summary of Inf82
Common Stock - Summary of Information Regarding Outstanding Restricted Shares (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Restricted Shares Outstanding, Beginning balance | 1,569,141 | 1,643,193 | 1,449,683 |
Restricted Stock Granted, Shares | 954,075 | 708,821 | 822,281 |
Restricted Stock Spin off, Shares | (319,949) | ||
Restricted Stock Vested, Shares | (405,327) | (348,981) | (368,984) |
Restricted Stock Canceled, Shares | (148,639) | (113,943) | (259,787) |
Restricted Shares Outstanding, Ending balance | 1,969,250 | 1,569,141 | 1,643,193 |
Weighted-Average Grant Date Fair Value of Restricted Stock, Beginning Balance | $ 73.73 | $ 67.98 | $ 62.29 |
Restricted Stock Granted, Weighted-Average Grant Date Fair Value | 53.27 | 70.14 | 63.69 |
Restricted Stock Spin off, Weighted-Average Grant Date Fair Value | 70.56 | ||
Restricted Stock Vested, Weighted-Average Grant Date Fair Value | 54.30 | 74.97 | 63.89 |
Restricted Stock Canceled, Weighted-Average Grant Date Fair Value | 62.73 | 70.32 | 37.78 |
Weighted-Average Grant Date Fair Value of Restricted Stock, Ending Balance | $ 61.53 | $ 73.73 | $ 67.98 |
Income Taxes - Domestic and For
Income Taxes - Domestic and Foreign Components of Income Before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Income before income taxes, Domestic | $ (1,577) | $ 1,415 | $ 1,362 |
Income before income taxes, Foreign | 988 | 2,079 | 1,762 |
Income before income taxes | $ (589) | $ 3,494 | $ 3,124 |
Income Taxes - Components of Pr
Income Taxes - Components of Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | |||
Federal | $ 30 | $ 681 | $ 632 |
State | (58) | 43 | 55 |
Foreign | 464 | 615 | 592 |
Total current income tax provision | 436 | 1,339 | 1,279 |
Deferred: | |||
Federal | (41) | (309) | (157) |
State | (38) | (5) | (12) |
Foreign | (179) | 14 | (167) |
Total deferred income tax benefit | (258) | (300) | (336) |
Total income tax provision | $ 178 | $ 1,039 | $ 943 |
Income Taxes - Difference Betwe
Income Taxes - Difference Between Effective Tax Rate (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax at U.S. statutory rate | $ (206) | $ 1,223 | $ 1,093 |
Foreign income tax rate differential | (110) | (261) | (216) |
State income tax, net of federal benefit | (4) | 25 | 27 |
Nondeductible expenses | 528 | 24 | 26 |
Tax benefit of manufacturing deduction | (1) | (37) | (33) |
Foreign dividends, net of foreign tax credits | 28 | 132 | 32 |
Tax rate change on timing differences | (45) | (2) | (22) |
Change in tax reserve | 69 | (11) | (1) |
Prior years taxes | (47) | (11) | (40) |
Foreign exchange losses | (46) | 28 | 25 |
Change in deferred tax valuation allowance | 15 | (83) | 40 |
Other | (3) | 12 | 12 |
Total income tax provision | $ 178 | $ 1,039 | $ 943 |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets and Liability (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred tax assets: | |||
Allowances and operating liabilities | $ 491 | $ 542 | $ 439 |
Net operating loss carryforwards | 170 | 118 | 51 |
Postretirement benefits | 79 | 79 | 49 |
Foreign tax credit carryforwards | 166 | 244 | 300 |
Other | 21 | 15 | 39 |
Deferred tax assets gross | 927 | 998 | 878 |
Valuation allowance for deferred tax assets | (63) | (48) | (133) |
Total deferred tax assets | 864 | 950 | 745 |
Deferred tax liabilities: | |||
Tax over book depreciation | 277 | 236 | 306 |
Intangible assets | 1,323 | 1,304 | 1,757 |
Deferred income | 232 | 257 | 285 |
Accrued U.S. tax on unremitted earnings | 55 | 107 | 92 |
Other | 209 | 377 | 164 |
Total deferred tax liabilities | 2,096 | 2,281 | 2,604 |
Net deferred tax liability | $ 1,232 | $ 1,331 | $ 1,859 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Unrecognized tax benefit | $ 46 | $ 115 | $ 127 | $ 128 |
Total uncertain tax position identified in foreign jurisdiction | 69 | |||
Uncertain tax position settled | 69 | |||
Increase in unrecognized tax benefits associated with potential transfer pricing adjustments | 14 | |||
Reduction in unrecognized tax position completion of audits in foreign jurisdictions | 75 | |||
Reduction in unrecognized tax benefit | 8 | |||
Decrease in unrecognized tax benefits | 152 | |||
Decrease of income tax expense in the current year | 14 | |||
Unrecognized tax benefits that would reduce income tax | 0.6 | |||
Accrued income tax interest and penalties related to unrecognized tax benefit | 3.8 | |||
Operating loss carry forward potential benefit | 170 | 118 | $ 51 | |
Foreign tax credit | 166 | |||
Undistributed earnings of foreign subsidiaries | 8,187 | $ 5,874 | ||
Realized [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Unrecognized tax benefit | 46 | |||
Carry Forward Expiration Year 2020 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 24 | |||
Carry Forward Expiration Year 2022 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 142 | |||
Domestic Country [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 21 | |||
Operating loss carry forward potential benefit | 7 | |||
Operating loss carry forward valuation allowance | 5 | |||
Income tax interest and penalties related to unrecognized tax benefit | 5 | |||
Domestic Country [Member] | Carry Forward Expiration Year 2026 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 1 | |||
Domestic Country [Member] | Carry Forward Expiration Year 2028 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 1 | |||
Domestic Country [Member] | Carry Forward Expiration Year 2020 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 5 | |||
Domestic Country [Member] | Carry Forward Expiration Year 2024 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 1 | |||
Domestic Country [Member] | Carry Forward Expiration Year 2025 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 13 | |||
Foreign Country [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 765 | |||
Operating loss carry forward potential benefit | 162 | |||
Operating loss carry forward valuation allowance | 58 | |||
Income tax interest and penalties related to unrecognized tax benefit | 58 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2034 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 4 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2035 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 43 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2016 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 9 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2017 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 34 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2018 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 31 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2019 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 5 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2020 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 20 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2021 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 20 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2022 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 6 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2023 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 9 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2024 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 208 | |||
Foreign Country [Member] | Carry Forward Expiration Year 2025 [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | 67 | |||
Foreign Country [Member] | Operating Loss Carry Forward Indefinitely [Member] | ||||
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ||||
Net operating loss carry forward | $ 309 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefit at beginning of year | $ 115 | $ 127 | $ 128 |
Additions based on tax positions related to the current year | 83 | 3 | |
Reductions for tax positions of prior years | (75) | ||
Settlements of audits | (69) | ||
Reductions for lapse of applicable statutes of limitations | (8) | (15) | (1) |
Unrecognized tax benefit at end of year | $ 46 | $ 115 | $ 127 |
Business Segments and Geograp89
Business Segments and Geographic Areas - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2015BusinessSegment | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | Segment | 4 | ||
Number of business units | 15 | ||
Revenue [Member] | Customer Concentration Risk [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from shipyard customer | 4.00% | 7.00% | 11.00% |
Rig Systems [Member] | |||
Segment Reporting Information [Line Items] | |||
Number of business units | 2 | ||
Rig Aftermarket [Member] | |||
Segment Reporting Information [Line Items] | |||
Number of business units | 1 | ||
Wellbore Technologies [Member] | |||
Segment Reporting Information [Line Items] | |||
Number of business units | 6 | ||
Completion & Production Solutions [Member] | |||
Segment Reporting Information [Line Items] | |||
Number of business units | 6 |
Business Segments and Geograp90
Business Segments and Geographic Areas - Revenues by Country Based on Sales Destination of Use of Products or Services (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | $ 2,722 | $ 3,306 | $ 3,909 | $ 4,820 | $ 5,709 | $ 5,587 | $ 5,255 | $ 4,889 | $ 14,757 | $ 21,440 | $ 19,221 |
United States [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 3,640 | 6,097 | 5,140 | ||||||||
South Korea [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 1,835 | 3,472 | 3,219 | ||||||||
China [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 1,623 | 1,905 | 1,007 | ||||||||
Singapore [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 1,035 | 1,157 | 1,850 | ||||||||
United Kingdom [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 634 | 715 | 705 | ||||||||
Brazil [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 605 | 1,299 | 811 | ||||||||
Norway [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 555 | 881 | 1,102 | ||||||||
Canada [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 365 | 645 | 625 | ||||||||
Other Countries [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | $ 4,465 | $ 5,269 | $ 4,762 |
Business Segments and Geograp91
Business Segments and Geographic Areas - Long-Lived Assets by Country Based on the Location (Detail) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | $ 3,124 | $ 3,362 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 1,735 | 1,818 |
Brazil [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 226 | 290 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 163 | 196 |
Denmark [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 128 | 144 |
South Korea [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 102 | 113 |
Mexico [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 93 | 110 |
Canada [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 78 | 99 |
Singapore [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 78 | 87 |
Other Countries [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | $ 521 | $ 505 |
Business Segments and Geograp92
Business Segments and Geographic Areas - Business Segments (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 2,722 | $ 3,306 | $ 3,909 | $ 4,820 | $ 5,709 | $ 5,587 | $ 5,255 | $ 4,889 | $ 14,757 | $ 21,440 | $ 19,221 |
Operating profit (loss) | (390) | 3,613 | 3,199 | ||||||||
Capital expenditures | 453 | 699 | 614 | ||||||||
Depreciation and amortization | 747 | 778 | 738 | ||||||||
Goodwill | 6,980 | 8,539 | 6,980 | 8,539 | 9,049 | ||||||
Total assets | 26,725 | 33,562 | 26,725 | 33,562 | 34,812 | ||||||
Rig Systems [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 1,232 | 1,236 | 1,232 | 1,236 | 1,279 | ||||||
Rig Aftermarket [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 877 | 877 | 877 | 877 | 906 | ||||||
Wellbore Technologies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 2,874 | 4,357 | 2,874 | 4,357 | 4,425 | ||||||
Completion & Production Solutions [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 1,997 | 2,069 | 1,997 | 2,069 | 2,106 | ||||||
Operating Segments [Member] | Rig Systems [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 6,964 | 9,848 | 8,450 | ||||||||
Operating profit (loss) | 1,206 | 1,996 | 1,594 | ||||||||
Capital expenditures | 81 | 133 | 61 | ||||||||
Depreciation and amortization | 96 | 88 | 82 | ||||||||
Goodwill | 1,232 | 1,236 | 1,232 | 1,236 | 1,279 | ||||||
Total assets | 6,772 | 8,052 | 6,772 | 8,052 | 7,654 | ||||||
Operating Segments [Member] | Rig Aftermarket [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 2,515 | 3,222 | 2,692 | ||||||||
Operating profit (loss) | 605 | 882 | 729 | ||||||||
Capital expenditures | 10 | 12 | 24 | ||||||||
Depreciation and amortization | 30 | 27 | 26 | ||||||||
Goodwill | 877 | 877 | 877 | 877 | 906 | ||||||
Total assets | 2,455 | 2,789 | 2,455 | 2,789 | 2,475 | ||||||
Operating Segments [Member] | Wellbore Technologies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 3,718 | 5,722 | 5,211 | ||||||||
Operating profit (loss) | (1,613) | 937 | 915 | ||||||||
Capital expenditures | 180 | 262 | 226 | ||||||||
Depreciation and amortization | 400 | 439 | 420 | ||||||||
Goodwill | 2,874 | 4,357 | 2,874 | 4,357 | 4,425 | ||||||
Total assets | 8,766 | 11,687 | 8,766 | 11,687 | 11,862 | ||||||
Operating Segments [Member] | Completion & Production Solutions [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 3,365 | 4,645 | 4,309 | ||||||||
Operating profit (loss) | 161 | 690 | 613 | ||||||||
Capital expenditures | 87 | 184 | 212 | ||||||||
Depreciation and amortization | 221 | 224 | 210 | ||||||||
Goodwill | 1,997 | 2,069 | 1,997 | 2,069 | 2,106 | ||||||
Total assets | 5,916 | 7,072 | 5,916 | 7,072 | 7,287 | ||||||
Eliminations [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | (1,805) | (1,997) | (1,441) | ||||||||
Operating profit (loss) | (749) | (892) | (652) | ||||||||
Capital expenditures | 95 | 108 | 91 | ||||||||
Total assets | $ 2,816 | $ 3,962 | $ 2,816 | $ 3,962 | 3,351 | ||||||
Discontinued Operations [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 333 | ||||||||||
Total assets | $ 2,183 |
Spin-off of Distribution Busi93
Spin-off of Distribution Business - Additional Information (Detail) - Now Inc [Member] $ in Millions | May. 30, 2014USD ($) | May. 22, 2014 | Dec. 31, 2014USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Ratio of common stock sharing | 4 | ||
Other costs | $ 36 | ||
Sales prior to the spin-off | $ 231 | ||
Purchases prior to the spin-off | $ 82 |
Spin-off of Distribution Busi94
Spin-off of Distribution Business - Schedule of Selected Financial Information Reported as Discontinued Operations (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reorganizations [Abstract] | ||||
Revenue from discontinued operations | $ 1,701 | $ 4,296 | ||
Income from discontinued operations before income taxes | 83 | 222 | ||
Income tax expense | 31 | 75 | ||
Income from discontinued operations | $ 11 | $ 41 | $ 52 | $ 147 |
Quarterly Financial Data (Una95
Quarterly Financial Data (Unaudited) - Summarized Quarterly Results (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 2,722 | $ 3,306 | $ 3,909 | $ 4,820 | $ 5,709 | $ 5,587 | $ 5,255 | $ 4,889 | $ 14,757 | $ 21,440 | $ 19,221 |
Gross profit | 359 | 672 | 855 | 1,177 | 1,536 | 1,528 | 1,455 | 1,290 | 3,063 | 5,809 | 5,104 |
Income (loss) from continuing operations | (1,522) | 156 | 286 | 313 | 597 | 701 | 609 | 548 | (767) | 2,455 | 2,181 |
Income from discontinued operations | 11 | 41 | 52 | 147 | |||||||
Net income (loss) attributable to Company | $ (1,523) | $ 155 | $ 289 | $ 310 | $ 595 | $ 699 | $ 619 | $ 589 | $ (769) | $ 2,502 | $ 2,327 |
Basic: | |||||||||||
Income (loss) from continuing operations | $ (4.06) | $ 0.41 | $ 0.75 | $ 0.76 | $ 1.39 | $ 1.63 | $ 1.42 | $ 1.28 | $ (1.99) | $ 5.73 | $ 5.11 |
Income from discontinued operations | 0.03 | 0.10 | 0.12 | 0.35 | |||||||
Net income (loss) attributable to Company | (4.06) | 0.41 | 0.75 | 0.76 | 1.39 | 1.63 | 1.45 | 1.38 | (1.99) | 5.85 | 5.46 |
Diluted: | |||||||||||
Income (loss) from continuing operations | (4.06) | 0.41 | 0.74 | 0.76 | 1.39 | 1.62 | 1.42 | 1.28 | (1.99) | 5.70 | 5.09 |
Income from discontinued operations | 0.02 | 0.09 | 0.12 | 0.35 | |||||||
Net income (loss) attributable to Company | (4.06) | 0.41 | 0.74 | 0.76 | 1.39 | 1.62 | 1.44 | 1.37 | (1.99) | 5.82 | 5.44 |
Cash dividends per share | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.46 | $ 0.26 | $ 1.84 | $ 1.64 | $ 0.91 |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Allowance for Doubtful Accounts [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | $ 125 | $ 132 | $ 120 |
Additions (Deductions) charged to costs and expenses | 77 | 31 | 32 |
Charge off's and other | (43) | (38) | (20) |
Balance end of year | 159 | 125 | 132 |
Allowance for Excess and Obsolete Inventories [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | 370 | 396 | 338 |
Additions (Deductions) charged to costs and expenses | 186 | 128 | 89 |
Charge off's and other | (56) | (154) | (31) |
Balance end of year | 500 | 370 | 396 |
Valuation Allowance for Deferred Tax Assets [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | 48 | 133 | 93 |
Additions (Deductions) charged to costs and expenses | 15 | (83) | 40 |
Charge off's and other | (2) | ||
Balance end of year | 63 | 48 | 133 |
Warranty Reserve [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | 272 | 228 | 194 |
Additions (Deductions) charged to costs and expenses | 92 | 123 | 101 |
Charge off's and other | (120) | (79) | (67) |
Balance end of year | $ 244 | $ 272 | $ 228 |