Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 09, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
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 | 380,143,691 | ||
Entity Public Float | $ 12.5 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 1,437 | $ 1,408 |
Receivables, net | 2,015 | 2,083 |
Inventories, net | 3,003 | 3,325 |
Costs in excess of billings | 495 | 665 |
Prepaid and other current assets | 267 | 395 |
Total current assets | 7,217 | 7,876 |
Property, plant and equipment, net | 3,002 | 3,150 |
Deferred income taxes | 13 | 86 |
Goodwill | 6,227 | 6,067 |
Intangibles, net | 3,301 | 3,530 |
Investment in unconsolidated affiliates | 309 | 307 |
Other assets | 137 | 124 |
Total assets | 20,206 | 21,140 |
Current liabilities: | ||
Accounts payable | 510 | 414 |
Accrued liabilities | 1,478 | 1,568 |
Billings in excess of costs | 279 | 440 |
Current portion of long-term debt and short-term borrowings | 6 | 506 |
Accrued income taxes | 81 | 119 |
Total current liabilities | 2,354 | 3,047 |
Long-term debt | 2,706 | 2,708 |
Deferred income taxes | 677 | 1,064 |
Other liabilities | 309 | 318 |
Total liabilities | 6,046 | 7,137 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock - par value $.01; 1 billion shares authorized; 380,104,970 and 378,637,403 shares issued and outstanding at December 31, 2017 and December 31, 2016 | 4 | 4 |
Additional paid-in capital | 8,234 | 8,103 |
Accumulated other comprehensive loss | (1,110) | (1,452) |
Retained earnings | 6,966 | 7,285 |
Total Company stockholders' equity | 14,094 | 13,940 |
Noncontrolling interests | 66 | 63 |
Total stockholders' equity | 14,160 | 14,003 |
Total liabilities and stockholders' equity | $ 20,206 | $ 21,140 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
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 | 380,104,970 | 378,637,403 |
Common stock, shares outstanding | 380,104,970 | 378,637,403 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | |||
Sales | $ 4,948 | $ 5,351 | $ 11,707 |
Services | 2,356 | 1,900 | 3,050 |
Total | 7,304 | 7,251 | 14,757 |
Cost of revenue | |||
Cost of sales | 4,499 | 5,671 | 9,362 |
Cost of services | 1,913 | 1,681 | 2,332 |
Total | 6,412 | 7,352 | 11,694 |
Gross profit (loss) | 892 | (101) | 3,063 |
Selling, general and administrative | 1,169 | 1,338 | 1,764 |
Goodwill and intangible asset impairment | 972 | 1,689 | |
Operating loss | (277) | (2,411) | (390) |
Interest and financial costs | (102) | (105) | (103) |
Interest income | 25 | 15 | 14 |
Equity income (loss) in unconsolidated affiliates | (5) | (21) | 13 |
Other income (expense), net | (33) | (101) | (123) |
Loss before income taxes | (392) | (2,623) | (589) |
Provision for income taxes | (156) | (207) | 178 |
Net loss | (236) | (2,416) | (767) |
Net income (loss) attributable to noncontrolling interests | 1 | (4) | 2 |
Net loss attributable to Company | $ (237) | $ (2,412) | $ (769) |
Net loss attributable to Company per share: | |||
Basic | $ (0.63) | $ (6.41) | $ (1.99) |
Diluted | (0.63) | (6.41) | (1.99) |
Cash dividends per share | $ 0.20 | $ 0.61 | $ 1.84 |
Weighted average shares outstanding: | |||
Basic | 377 | 376 | 387 |
Diluted | 377 | 376 | 387 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (236) | $ (2,416) | $ (767) |
Other comprehensive income (loss): | |||
Currency translation adjustments | 272 | (97) | (764) |
Derivative financial instruments, net of tax | 46 | 166 | 23 |
Change in defined benefit plans, net of tax | 24 | 32 | 22 |
Comprehensive income (loss) | 106 | (2,315) | (1,486) |
Net income (loss) attributable to noncontrolling interests | 1 | (4) | 2 |
Comprehensive income (loss) attributable to Company | $ 105 | $ (2,311) | $ (1,488) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net loss | $ (236) | $ (2,416) | $ (767) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 698 | 703 | 747 |
Deferred income taxes | (341) | (198) | (258) |
Stock-based compensation | 124 | 107 | 109 |
Excess tax benefit from stock-based compensation | 7 | 1 | |
Equity (income) loss in unconsolidated affiliates | 5 | 21 | (13) |
Dividend from unconsolidated affiliate | 6 | 34 | |
Goodwill and intangible asset impairment | 972 | 1,689 | |
Provision for inventory losses | 114 | 606 | 186 |
Other, net | 20 | 108 | 70 |
Change in operating assets and liabilities, net of acquisitions: | |||
Receivables | 72 | 845 | 1,091 |
Inventories | 229 | 782 | 410 |
Costs in excess of billings | 170 | 646 | 548 |
Prepaid and other current assets | 130 | 102 | 112 |
Accounts payable | 86 | (243) | (570) |
Accrued liabilities | (130) | (773) | (1,137) |
Billings in excess of costs | (160) | (366) | (686) |
Income taxes payable | (44) | (146) | (167) |
Other assets/liabilities, net | 95 | 197 | (67) |
Net cash provided by operating activities | 832 | 960 | 1,332 |
Cash flows from investing activities: | |||
Purchases of property, plant and equipment | (192) | (284) | (453) |
Business acquisitions, net of cash acquired | (86) | (230) | (86) |
Other, net | 33 | 26 | 25 |
Net cash used in investing activities | (245) | (488) | (514) |
Cash flows from financing activities: | |||
Borrowings against lines of credit and other debt | 3,972 | 11,377 | |
Payments against lines of credit and other debt | (506) | (4,872) | (10,615) |
Cash dividends paid | (76) | (230) | (710) |
Share repurchases | (2,221) | ||
Activity under stock incentive plans | (3) | 4 | 7 |
Excess tax benefit from stock-based compensation | (7) | (1) | |
Other | (10) | (8) | |
Net cash used in financing activities | (595) | (1,141) | (2,163) |
Effect of exchange rates on cash | 37 | (3) | (111) |
Increase (decrease) in cash and cash equivalents | 29 | (672) | (1,456) |
Cash and cash equivalents, beginning of period | 1,408 | 2,080 | 3,536 |
Cash and cash equivalents, end of period | 1,437 | 1,408 | 2,080 |
Cash payments during the period for: | |||
Interest | 97 | 101 | 103 |
Income taxes | $ 50 | $ 181 | $ 782 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Stock-Based Compensation on Tender Offer [Member] | Common Stock [Member] | Additional Paid in Capital [Member] | Additional Paid in Capital [Member]Stock-Based Compensation on Tender Offer [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings (Loss) [Member] | Total Company Stockholders' Equity [Member] | Total Company Stockholders' Equity [Member]Stock-Based Compensation on Tender Offer [Member] | Noncontrolling Interests [Member] |
Beginning Balance at Dec. 31, 2014 | $ 20,772 | $ 4 | $ 8,341 | $ (834) | $ 13,181 | $ 20,692 | $ 80 | |||
Beginning 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) | |||||||
Noncontrolling interest | (5) | (5) | ||||||||
Stock-based compensation | 109 | 109 | 109 | |||||||
Common stock issued | 7 | 7 | 7 | |||||||
Common stock issued, shares | 1 | |||||||||
Withholding taxes | (5) | (5) | (5) | |||||||
Share repurchases, value | (2,221) | (446) | (1,775) | (2,221) | ||||||
Share repurchases, shares | (44) | |||||||||
Excess tax benefit from stock-based compensation | (1) | (1) | (1) | |||||||
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 | |||||||||
Net income (loss) | (2,416) | (2,412) | (2,412) | (4) | ||||||
Other comprehensive income (loss), net | 101 | 101 | 101 | |||||||
Cash dividends, per common share | (230) | (230) | (230) | |||||||
Noncontrolling interest | (10) | (10) | ||||||||
Stock-based compensation | 87 | 87 | 87 | |||||||
Common stock issued | 4 | 4 | 4 | |||||||
Common stock issued, shares | 2 | |||||||||
Stock issued in acquisition | 18 | 18 | 18 | |||||||
Stock issued in acquisition, shares | 1 | |||||||||
Withholding taxes | (4) | (4) | (4) | |||||||
Excess tax benefit from stock-based compensation | (7) | (7) | (7) | |||||||
Ending Balance at Dec. 31, 2016 | 14,003 | $ 4 | 8,103 | (1,452) | 7,285 | 13,940 | 63 | |||
Ending Balance, shares at Dec. 31, 2016 | 379 | |||||||||
Net income (loss) | (236) | (237) | (237) | 1 | ||||||
Other comprehensive income (loss), net | 342 | 342 | 342 | |||||||
Cash dividends, per common share | (76) | (76) | (76) | |||||||
Adoption of new accounting standards | (5) | 1 | (6) | (5) | ||||||
Noncontrolling interest | 2 | 2 | ||||||||
Stock-based compensation | 105 | $ 20 | 105 | $ 20 | 105 | $ 20 | ||||
Common stock issued | 13 | 13 | 13 | |||||||
Common stock issued, shares | 1 | |||||||||
Withholding taxes | (8) | (8) | (8) | |||||||
Ending Balance at Dec. 31, 2017 | $ 14,160 | $ 4 | $ 8,234 | $ (1,110) | $ 6,966 | $ 14,094 | $ 66 | |||
Ending Balance, shares at Dec. 31, 2017 | 380 |
Consolidated Statements of Sto8
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Retained Earnings (Loss) [Member] | |||
Cash dividends, per common share | $ 0.20 | $ 0.61 | $ 1.84 |
Organization and Basis of Prese
Organization and Basis of Presentation | 12 Months Ended |
Dec. 31, 2017 | |
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. Certain reclassifications have been made to the prior year financial statements in order for them to conform with the 2017 presentation. 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. The Company combined its Rig Systems and Rig Aftermarket reporting segments into a single segment called Rig Technologies, effective October 1, 2017. The restructuring better aligns operations with the current and anticipated market environments, reduces administrative burden, and eliminates reported intercompany transactions between Rig Technologies’ capital equipment and aftermarket operations. The Company’s reporting segments are Wellbore Technologies, Completion & Production Solutions, and Rig Technologies. As a result of the reorganization, all prior periods are presented on this basis. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
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 Inventories Inventories consist of raw materials, work-in-process first-in, first-out on-hand, The Company evaluates inventory quarterly using the best information available at the time to inform our assumptions and estimates about future demand and resulting sales volumes, and recognizes reserves as necessary to properly state inventory. The historically severe oil-industry mid-2014 Based on an update of our assumptions at each point in time related to estimates of future demand, during 2017 and 2016 we recorded charges for additions to inventory reserves of $114 million and $606 million, respectively, consisting primarily of obsolete and surplus inventories. At December 31, 2017 and 2016, inventory reserves totaled $800 million and $1,017 million, or 21.0% and 23.4% of gross inventory, respectively. 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, which includes the amortization of assets recorded under capital leases, was $359 million, $370 million and $391 million for the years ended December 31, 2017, 2016 and 2015, respectively. Accumulated depreciation of $2,559 million as of December 31, 2017 included accumulated depreciation of $18 million for capital leases. 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 were $10 million and $54 million in impairments of long-lived assets for the years ended December 31, 2017 and 2016, respectively, and nil for the year ended December 31, 2015. Intangible Assets The Company has approximately $6.2 billion of goodwill and $3.3 billion of identified intangible assets at December 31, 2017. Goodwill is identified by segment as follows (in millions): Wellbore Completion & Rig Total Balance at December 31, 2015 $ 2,874 $ 1,997 $ 2,109 $ 6,980 Goodwill acquired and adjusted during period 4 70 — 74 Impairment — — (972 ) (972 ) Currency translation adjustments (4 ) (9 ) (2 ) (15 ) Balance at December 31, 2016 $ 2,874 $ 2,058 $ 1,135 $ 6,067 Goodwill acquired and adjusted during period 37 41 11 89 Currency translation adjustments 45 23 3 71 Balance at December 31, 2017 (1) $ 2,956 $ 2,122 $ 1,149 $ 6,227 (1) Accumulated goodwill impairment was $2,457 million as of December 31, 2017. 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. The net book values of identified intangible assets are identified by segment as follows (in millions): Wellbore Completion & Rig Total Balance at December 31, 2015 $ 2,254 $ 1,296 $ 299 $ 3,849 Additions to intangible assets 15 9 — 24 Amortization (205 ) (106 ) (22 ) (333 ) Currency translation adjustments — (8 ) (2 ) (10 ) Balance at December 31, 2016 $ 2,064 $ 1,191 $ 275 $ 3,530 Additions to intangible assets 18 41 2 61 Amortization (208 ) (108 ) (23 ) (339 ) Currency translation adjustments 9 36 4 49 Balance at December 31, 2017 $ 1,883 $ 1,160 $ 258 $ 3,301 Identified intangible assets by major classification consist of the following (in millions): Gross Accumulated Net Book December 31, 2016: Customer relationships $ 4,024 $ (1,874 ) $ 2,150 Trademarks 878 (290 ) 588 Patents 585 (345 ) 240 Indefinite-lived trade names 384 — 384 Other 463 (295 ) 168 Total identified intangibles $ 6,334 $ (2,804 ) $ 3,530 December 31, 2017: Customer relationships $ 4,074 $ (2,118 ) $ 1,956 Trademarks 885 (317 ) 568 Patents 602 (384 ) 218 Indefinite-lived trade names 384 — 384 Other 499 (324 ) 175 Total identified intangibles $ 6,444 $ (3,143 ) $ 3,301 Asset Impairment Generally Accepted Accounting Principles require the Company test goodwill and other indefinite-lived intangible assets for impairment at least annually or more frequently whenever events or circumstances occur indicating that those assets might be impaired. Prior to 2017, the impairment analysis was a two-step process as the Company early adopted Accounting Standard Update No. 2017-04 “Simplifying the Test for Goodwill Impairment,” which eliminates step two effective July 1, 2017. The impairment analysis compares the reporting unit’s carrying value to the respective fair value. Fair value of the reporting unit 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. The discounted cash flow is based on management’s forecast of operating performance for the 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 reporting unit and its 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. Cash flows beyond the updated forecasted 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. Based on the Company’s step one impairment analysis, as of July 1, 2016, completed as a result of market indicators identified in the third quarter, the Rig Offshore reporting unit had a calculated fair value below its carrying value, and required a step two analysis, which compares the implied fair value of goodwill of a reporting unit to the carrying value of goodwill for the reporting unit. 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. Consistent with the step one analysis, fair value of the assets and liabilities was determined in accordance with ASC Topic 820. Based on the step two analysis performed for the Rig Offshore reporting unit, the Company recorded a $972 million write-down of goodwill during the third quarter. On July 1, 2017, the Company’s Wellbore Technologies segment reorganized three of its reporting units, moving various operations between them. The goodwill impairment analyses performed prior to and subsequent to the restructuring of the three reporting units, concluded that the calculated fair values of these reporting units were substantially in excess of their carrying value. The restructuring had no effect on Wellbore Technologies consolidated financial position and results of operations. The Company combined its Rig Systems and Rig Aftermarket reporting units into two different reporting units, Rig Equipment and Marine Construction, under a segment called Rig Technologies, effective October 1, 2017. The restructuring better aligns operations with the current and anticipated market environments, reduces administrative burden, and eliminates reported intercompany transactions between Rig Technologies’ capital equipment and aftermarket operations. The Company tested the Rig Systems and Rig Aftermarket reporting units for impairment prior to combining, and the two, new reporting units under the Rig Technologies segment for impairment after combining, and concluded all fair values of the reporting units were substantially in excess of their carrying values. During the fourth quarter of 2017, the Company performed its annual impairment test, as described in ASC Topic 350, as of October 1, 2017. Based on the Company’s annual impairment test, the calculated fair values for all of the Company’s reporting units were substantially in excess of the respective reporting unit’s carrying value. Additionally, the fair value for all of the Company’s intangible assets with indefinite lives were substantially in excess of the respective asset carrying values. Foreign Currency Certain foreign operations, including our operations in Norway, use the U.S. dollar as the functional 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. 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 $(3) million, $(10) million and $(47) million for the years ending December 31, 2017, 2016 and 2015, 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 quarter of 2015, the Venezuelan government officially devalued the Venezuelan bolivar against the U.S. dollar. As a result, the Company incurred approximately $9 million in devaluation charges in the first quarter of 2015. 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 nil at December 31, 2017. 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 costs 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 Completion & Production Solutions and Rig Technologies 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, 2015 $ 244 Net provisions for warranties issued during the year 50 Amounts incurred (127 ) Currency translation adjustments and other 5 Balance at December 31, 2016 $ 172 Net provisions for warranties issued during the year 46 Amounts incurred (86 ) Currency translation adjustments and other 3 Balance at December 31, 2017 $ 135 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 $187 million and $209 million at December 31, 2017 and 2016, respectively. 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 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, 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 Loss 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, 2017 2016 2015 Numerator: Net loss attributable to Company $ (237 ) $ (2,412 ) $ (769 ) Denominator: Basic—weighted average common shares outstanding 377 376 387 Dilutive effect of employee stock options and other unvested stock awards — — — Diluted outstanding shares 377 376 387 Basic loss attributable to Company per share $ (0.63 ) $ (6.41 ) $ (1.99 ) Diluted loss attributable to Company per share $ (0.63 ) $ (6.41 ) $ (1.99 ) Cash dividends per share $ 0.20 $ 0.61 $ 1.84 ASC Topic 260, “Earnings Per Share” (“ASC Topic 260”) requires companies with unvested participating securities to utilize a two-class two-class non-forfeitable Recently Adopted Accounting Standards In July 2015, the FASB issued Accounting Standard Update No. 2015-11 2015-11). 2015-11 In March 2016, the FASB issued Accounting Standard Update No. 2016-09 2016-09). 2016-09 In October 2016, the FASB issued Accounting Standard Update No. 2016-16 2016-16). 2016-16 In January 2017, the FASB issued Accounting Standard Update No. 2017-04 2017-04). 2017-04 Recently Issued Accounting Standards In August 2017, the FASB issued Accounting Standard Update No. 2017-12 2017-12). 2017-12 2017-12. No. 2017-12 In March 2017, the FASB issued Accounting Standard Update No. 2017-07 2017-07). 2017-07 No. 2017-07 In August 2016, the FASB issued Accounting Standard Update No. 2016-15 2016-15). No. 2016-15 No. 2016-15 In March 2016, the FASB issued ASC Topic 842, “Leases” (ASC Topic 842), which supersedes the lease requirements in ASC Topic No. 840 “Leases” and most industry-specific guidance. This update increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASC Topic 842 is effective for fiscal years beginning after December 15, 2018, and for interim periods within those fiscal years. In preparing for the adoption of this new standard, the Company has established an internal team to centralize the implementation process as well as engaged external resources to assist in our approach. We are currently utilizing a software program to consolidate and accumulate leases with documentation as required by the new standard. We have assessed the changes to the Company’s current accounting practices and are currently investigating the related tax impact and process changes. We are also in the process of quantifying the impact of the new standard on our balance sheet. In May 2014, the FASB issued Accounting Standard Update No. 2014-09, 2014-09), The standard permits either a full retrospective adoption, in which the standard is applied to all the periods presented, or a modified retrospective adoption, in which the standard is applied only to the current period with a cumulative-effect adjustment reflected in retained earnings. ASU 2014-09 In 2015, the Company assembled an internal team to study the provisions of ASU 2014-09, Based on an analysis of revenue streams, customer contracts and transactions, the Company does not expect a material change in the timing or other impacts to revenue recognition across most of our businesses. Certain service and repair revenue will change from point-in-time to over-time revenue recognition, and the timing of including uninstalled materials in projects will shift, changing only the timing of revenue recognition and not the total amount. We expect the cumulative-effect adjustment we will record in the first quarter of 2018, as required by the modified retrospective method, to be less than $50 million. The final adjustment is subject to concluding on the available practical expediants. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
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 (non-designated At December 31, 2017, the Company has determined that the fair value of its derivative financial instruments representing assets of $33 million and liabilities of $11 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, 2017, the net fair value of the Company’s foreign currency forward contracts totaled a net asset of $22 million. At December 31, 2017, 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, 2017 December 31, 2016 Norwegian Krone NOK 4,013 NOK 5,621 Japanese Yen JPY 982 JPY 1,462 U.S. Dollar USD 163 USD 321 Euro EUR 120 EUR 279 Danish Krone DKK 30 DKK 29 British Pound Sterling GBP 11 GBP 1 Singapore Dollar SGD — SGD 2 Non-designated 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 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, 2017 December 31, 2016 Russian Ruble RUB 2,699 RUB 1,893 Norwegian Krone NOK 1,734 NOK 538 U.S. Dollar USD 463 USD 457 South African Rand ZAR 150 ZAR 150 Euro EUR 99 EUR 272 Danish Krone DKK 15 DKK 49 British Pound Sterling GBP 3 GBP 3 Singapore Dollar SGD — SGD 7 Canadian Dollar CAD — CAD 1 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 Fair Value Balance Sheet Fair Value Location 2017 2016 Location 2017 2016 Derivatives designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 13 $ 24 Accrued liabilities $ 3 $ 37 Foreign exchange contracts Other Assets 8 6 Other Liabilities 2 11 Total derivatives designated as hedging instruments under ASC Topic 815 $ 21 $ 30 $ 5 $ 48 Derivatives not designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 10 $ 32 Accrued liabilities $ 5 $ 29 Foreign exchange contracts Other Assets 2 — Other Liabilities 1 — Total derivatives not designated as hedging instruments under ASC Topic 815 $ 12 $ 32 $ 6 $ 29 Total derivatives $ 33 $ 62 $ 11 $ 77 The Effect of Derivative Instruments on the Consolidated Statements of Income (Loss) ($ in millions) Derivatives Designated as Hedging Instruments under ASC Topic 815 Amount of Gain (Loss) Recognized in OCI on Location of Gain (Loss) (Effective Portion) Amount of Gain (Loss) Location of Gain (Loss) Testing) Amount of Gain (Loss) Years Ended December 31, Years Ended December 31, Years Ended December 31, 2017 2016 2017 2016 2017 2016 Revenue 8 5 Cost of revenue 7 (21 ) Foreign exchange contracts 56 45 Cost of (19 ) (170 ) Other income 2 8 Total 56 45 (11 ) (165 ) 9 (13 ) Derivatives Not Designated as Location of Gain (Loss) Amount of Gain (Loss) Hedging Instruments under Recognized in Income Recognized in Income on ASC Topic 815 on Derivatives Derivatives Years Ended December 31, 2017 2016 Foreign exchange contracts Other income (expense), net 58 (33 ) Total 58 (33 ) (a) The Company expects that $5 million of the Accumulated Other Comprehensive Income (Loss) will be reclassified into earnings within the next twelve months with an offset by losses from the underlying transactions resulting in no impact to earnings or cash flow. (b) The amount of gain (loss) recognized in income represents $7 million and $(21) million related to the ineffective portion of the hedging relationships for the years ended December 31, 2017 and 2016, respectively, and $2 million and $8 million related to the amount excluded from the assessment of the hedge effectiveness for the years ended December 31, 2017 and 2016, respectively. |
Acquisitions and Investments
Acquisitions and Investments | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisitions and Investments | 4. Acquisitions and Investments 2017 In the year ended December 31, 2017, the Company completed a total of eight acquisitions and other investments for an aggregate cash investment of $86 million, net of cash acquired. The Company has preliminarily allocated $61 million to identifiable intangible assets and $89 million to goodwill for current and prior year acquisitions. 2016 In the year ended December 31, 2016, the Company completed a total of 10 acquisitions and other investments for an aggregate cash investment of $230 million, net of cash acquired and $18 million of NOV stock. The Company allocated $24 million to identifiable intangible assets and $74 million to goodwill. 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 allocated $13 million to identifiable intangible assets and $51 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. 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 (Loss) from the date of acquisition. A summary of the acquisitions follows (in millions): Years Ended December 31, 2017 2016 2015 Fair value of assets acquired, net of cash acquired $ 154 $ 357 $ 116 Cash paid, net of cash acquired (86 ) (230 ) (86 ) Liabilities assumed, debt issued and noncontrolling interest $ 68 $ 127 $ 30 Excess purchase price over fair value of net assets acquired $ 89 $ 74 $ 51 |
Inventories, net
Inventories, net | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories, net | 5. Inventories, net Inventories consist of (in millions): December 31, 2017 2016 Raw materials and supplies $ 656 $ 961 Work in process 513 561 Finished goods and purchased products 1,834 1,803 Total $ 3,003 $ 3,325 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 Land and buildings 5-35 Years $ 1,592 $ 1,570 Operating equipment 3-15 3,169 3,102 Rental equipment 3-12 581 557 Capital leases 20-24 Years 219 219 5,561 5,448 Less: Accumulated Depreciation (2,559 ) (2,298 ) $ 3,002 $ 3,150 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | 7. Accrued Liabilities Accrued liabilities consist of (in millions): December 31, 2017 2016 Vendor costs $ 150 $ 235 Customer prepayments and billings 240 222 Compensation 345 181 Taxes (non income) 152 176 Warranty 135 172 Insurance 74 103 Fair value of derivatives 8 66 Commissions 58 57 Interest 7 8 Other 309 348 Total $ 1,478 $ 1,568 |
Costs and Estimated Earnings on
Costs and Estimated Earnings on Uncompleted Contracts | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 Costs incurred on uncompleted contracts $ 6,395 $ 8,132 Estimated earnings 3,023 3,869 9,418 12,001 Less: Billings to date on uncompleted contracts 9,202 11,776 $ 216 $ 225 Costs and estimated earnings in excess of billings on uncompleted contracts $ 495 $ 665 Billings in excess of costs and estimated earnings on uncompleted contracts (279 ) (440 ) $ 216 $ 225 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | 9. Debt Debt consists of (in millions): December 31, 2017 2016 $500 million in Senior Notes, interest at 1.35% payable semiannually, principal due on December 1, 2017 — 499 $1.4 billion in Senior Notes, interest at 2.60% payable semiannually, principal due on December 1, 2022 1,392 1,391 $1.1 billion in Senior Notes, interest at 3.95% payable semiannually, principal due on December 1, 2042 1,088 1,087 Capital Leases and other debt 232 237 Total debt 2,712 3,214 Less current portion 6 506 Long-term debt $ 2,706 $ 2,708 Principal payments of debt and capital leases for years subsequent to 2017 are as follows (in millions): 2018 $ 6 2019 5 2020 5 2021 5 2022 1,405 Thereafter 1,286 $ 2,712 See Note 12 for additional details on future lease payments specific to capital leases. On June 27, 2017, the Company entered into a new $3.0 billion credit agreement evidencing a five-year unsecured revolving credit facility, which expires on June 27, 2022, with a syndicate of financial institutions. This new credit facility replaced the Company’s previous $4.5 billion revolving credit facility. The Company has the right to increase the aggregate commitments under this new agreement to an aggregate amount of up to $4.0 billion upon the consent of only those lenders holding any such increase. Interest under the new multicurrency facility is based upon LIBOR, NIBOR or CDOR plus 1.125% subject to a ratings-based grid or the U.S. prime rate. The new credit facility contains a financial covenant regarding maximum debt-to-capitalization debt-to-capitalization On November 29, 2017, the Company repaid in its entirety the $500 million of its 1.35% unsecured Senior Notes using available cash balances. The Company has a commercial paper program under which borrowings are classified as long-term since the program is supported by the $3.0 billion, five-year credit facility. At December 31, 2017, there were no commercial paper borrowings, and there were no outstanding letters of credit issued under the credit facility, resulting in $3.0 billion of funds available under this credit facility. The Company had $658 million of outstanding letters of credit at December 31, 2017, primarily in the U.S. and Norway, that are under various bilateral committed letter of credit facilities. Letters of credit are issued as bid bonds, advanced payment bonds and performance bonds. At December 31, 2017 and 2016, the fair value of the Company’s unsecured Senior Notes approximated $2,346 million and $2,669 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, 2017 and 2016, the carrying value of the Company’s unsecured Senior Notes approximated $2,480 million and $2,977 million, respectively. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [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, 2017, 2016 and 2015, expenses for defined-contribution plans were $64 million, $66 million, and $95 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 40 employees represented by certain collective bargaining agreements continue to accrue benefits under the plan. In addition, approximately 1,950 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. During 2016, the Company settled its Norway defined benefit plan and transferred all participants to the defined-contribution plan. The impact on the defined benefit plans is reflected in the table below. Net periodic benefit cost for our defined benefit plans aggregated $1 million, $5 million and $5 million for the years ended December 31, 2017, 2016 and 2015, 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, 2017 and 2016, is as follows (in millions): Pension benefits Postretirement benefits At year end 2017 2016 2017 2016 Benefit obligation at beginning of year $ 622 $ 703 $ 92 $ 90 Service cost 1 5 — — Interest cost 20 25 3 3 Actuarial loss (gain) 6 42 (17 ) (29 ) Benefits paid (31 ) (30 ) (14 ) (16 ) Participants contributions — — 2 2 Exchange rate loss (gain) 30 (37 ) — — Acquisitions (disposals) — 2 — — Curtailments — (17 ) (4 ) — Settlements (15 ) (71 ) — — Other — — — 42 Benefit obligation at end of year $ 633 $ 622 $ 62 $ 92 Fair value of plan assets at beginning of year $ 543 $ 601 $ — $ — Actual return 57 60 — — Benefits paid (31 ) (30 ) (14 ) (16 ) Company contributions 11 16 12 14 Participants contributions — — 2 2 Exchange rate gain (loss) 24 (34 ) — — Settlements (15 ) (71 ) — — Acquisitions (disposals) — 1 — — Other (1 ) — — — Fair value of plan assets at end of year $ 588 $ 543 $ — $ — Funded status $ (45 ) $ (79 ) $ (62 ) $ (92 ) Accumulated benefit obligation at end of year $ 630 $ 617 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, 2017 2016 Discount rate: United States plan 3.00% - 3.60% 3.10% - 4.00% International plans 1.80% - 2.40% 1.80% - 2.80% Salary increase: United States plan N/A N/A International plans 1.80% - 3.30% 1.80% - 3.50% The assumption rates used for net periodic benefit costs are as follows: Years Ended December 31, 2017 2016 2015 Discount rate: United States plan 3.10% - 4.00% 3.20% - 4.20% 3.70% - 4.20% International plans 1.80% - 2.80% 2.20% - 3.70% 2.20% - 3.70% Salary increase: United States plan N/A N/A N/A International plans 1.80% - 3.50% 2.00% - 4.20% 2.00% - 4.20% Expected return on assets: United States plan 5.60% 5.60% 5.50% International plans 1.80% - 3.00% 1.80% - 3.00% 2.30% - 5.12% 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 $33 million for each of the next five years and aggregate payments of $324 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, 2016: Equity securities $ 181 $ — $ 181 $ — Bonds 262 — 262 — Other (insurance contracts) 100 — 47 53 Total Fair Value Measurements $ 543 $ — $ 490 $ 53 December 31, 2017: Equity securities $ 161 $ — $ 161 $ — Bonds 284 — 284 — Other (insurance contracts) 143 — 82 61 Total Fair Value Measurements $ 588 $ — $ 527 $ 61 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 Plan Assets Balance at December 31, 2015 $ 99 Actual return on plan assets still held at reporting date 5 Purchases, sales and settlements (50 ) Currency translation adjustments (1 ) Balance at December 31, 2016 $ 53 Actual return on plan assets still held at reporting date 2 Purchases, sales and settlements (1 ) Currency translation adjustments 7 Balance at December 31, 2017 $ 61 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2017 | |
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, 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 ) Accumulated other comprehensive income (loss) before reclassifications (97 ) 32 35 (30 ) Amounts reclassified from accumulated other comprehensive income (loss) — 134 (3 ) 131 Balance at December 31, 2016 $ (1,376 ) $ (39 ) $ (37 ) $ (1,452 ) Accumulated other comprehensive income (loss) before reclassifications 272 41 25 338 Amounts reclassified from accumulated other comprehensive income (loss) — 5 (1 ) 4 Balance at December 31, 2017 $ (1,104 ) $ 7 $ (13 ) $ (1,110 ) The components of amounts reclassified from accumulated other comprehensive income (loss) are as follows (in millions): Years Ended December 31, 2017 2016 2015 Currency Derivative Defined Total Currency Derivative Defined Total Currency Derivative Defined Total Revenue $ — $ (8 ) $ — $ (8 ) $ — $ (5 ) $ — $ (5 ) $ — $ (19 ) $ — $ (19 ) Cost of revenue — 12 — 12 — 191 — 191 — 295 — 295 Selling, general, and administrative — — (1 ) (1 ) — — (5 ) (5 ) — — (6 ) (6 ) Tax effect — 1 — 1 — (52 ) 2 (50 ) — (77 ) 2 (75 ) $ — $ 5 $ (1 ) $ 4 $ — $ 134 $ (3 ) $ 131 $ — $ 199 $ (4 ) $ 195 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 year ended December 31, 2017, a majority of these local currencies strengthened against the U.S. dollar, resulting in net other comprehensive income of $272 million upon the translation from local currencies to the U.S. dollar. For the years ended December 31, 2016 and 2015, a majority of these local currencies weakened against the U.S. dollar, resulting in a net other comprehensive loss of $97 million and $764 million, respectively, upon the translation from local currencies to the U.S. dollar. 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 $46 million (net of tax of $13 million) for the year ended December 31, 2017, other comprehensive income of $166 million (net of tax of $65 million) for the year ended December 31, 2016 and other comprehensive income of $23 million (net of tax of $14 million) for the year ended December 31, 2015. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12. Commitments and Contingencies 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. In November 2016, the Company executed documents following a 2009-2010 internal investigation settling with U.S. governmental agencies related to our compliance with U.S. export trade laws and regulations. As anticipated, the administrative fines and penalties agreed to as part of a resolution were within established accruals, and had no material effect on our financial position or results of operations. The investigation and settlement are now closed. The Company is 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. The Company is also a party to claims, threatened and actual litigation, and private arbitration arising from ordinary day to day business activities, in which parties assert claims against the Company for a broad spectrum of potential liabilities, including: individual employment law claims, collective actions under federal employment laws, intellectual property claims, including alleged patent infringement, and/or misappropriation of trade secrets, premises liability claims, personal injuries arising from allegedly defective products, alleged improper payments under anti-corruption and anti-bribery laws and other commercial claims seeking recovery for alleged actual or exemplary damages. For many such contingent claims, the Company’s insurance coverage is inapplicable or an exclusion to coverage may apply. In such instances, settlement or other resolution of such contingent claims could have a material financial or reputational impact on the Company. As of December 31, 2017, 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. 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. 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 have 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. We may also become involved in these investigations, at substantial cost to the Company. 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 have executed settlements with several shipyard customers since December 28, 2015 concerning contracts for the supply of drilling equipment packages for 16 drillship construction projects in Brazil (collectively the “Supply Contracts”). Pursuant to the terms of the settlements, 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. 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 remaining 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. In 2016, in light of the vote by the shareholders of SETE Brasil Participacoes SA to authorize Sete to file for bankruptcy, and a further decline in drilling activity during the first half of the year to record lows and the resulting effect on certain other customers, the Company removed $2.1 billion (unaudited) of orders from its backlog in the first quarter of 2016. Some of the contracts for these orders remain in place and are enforceable. If these customers obtain funding to continue their projects, the Company will pursue resumption of construction and update the backlog accordingly. In other instances, 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. 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. While we manage equipment deliveries and collection of payment to 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 2041. 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 $209 million, $246 million, and $327 million in 2017, 2016 and 2015, respectively. Future minimum lease commitments under capital leases and noncancellable operating leases with initial or remaining terms of one year or more at December 31, 2017, are payable as follows (in millions): Capital Lease Operating Lease 2018 $ 15 $ 130 2019 15 98 2020 15 82 2021 15 67 2022 15 55 Thereafter 273 339 Total future lease commitments $ 348 $ 771 |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2017 | |
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 $76 million and $230 million for the years ended December 31, 2017 and 2016, 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. Total compensation cost that has been charged against income for all share-based compensation arrangements was $124 million, $107 million and $109 million for 2017, 2016 and 2015, respectively. The total income tax benefit recognized in the consolidated statements of income for all share-based compensation arrangements was $24 million, $30 million and $32 million for 2017, 2016 and 2015, respectively. Under the terms of National Oilwell Varco’s Long-Term Incentive Plan, as amended during the second quarter of 2016, 69.4 million shares of common stock are authorized for the grant of options to officers, key employees, non-employee 1-for-1 3-for-1 Stock Options 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. We also have an inactive stock option plan that was acquired in connection with the acquisition of Grant Prideco in 2008. We converted the outstanding stock options under this plan to options to acquire our common stock and no further options are being issued under this plan. 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, 2017 under the stock option plans have exercise prices between $23.94 and $77.99 per share, and expire at various dates from February 8, 2018 to April 1, 2027. The following summarizes options activity: Years Ended December 31, 2017 2016 2015 Number Average Number Average Number Average of Exercise of Exercise of Exercise Shares Price Shares Price Shares Price Shares under option at beginning of year 17,439,060 $ 54.08 15,430,307 $ 59.50 10,881,133 $ 61.22 Granted 6,961,041 36.51 3,672,411 28.26 5,746,153 54.74 Forfeited (1,482,531 ) 55.22 (1,517,065 ) 49.95 (886,356 ) 62.73 Exercised (445,523 ) 29.83 (146,593 ) 28.53 (310,623 ) 22.56 Shares under option at end of year 22,472,047 $ 48.99 17,439,060 $ 54.08 15,430,307 $ 59.50 Exercisable at end of year 14,309,944 $ 55.00 9,828,897 $ 61.56 7,498,414 $ 60.30 The following summarizes information about stock options outstanding at December 31, 2017: Weighted-Avg Options Outstanding Options Exercisable Remaining Weighted-Avg Weighted-Avg Range of Exercise Price Contractual Life Shares Exercise Price Shares Exercise Price $23.94 - $55.00 7.55 15,797,683 $ 40.25 7,635,580 $ 42.19 $55.01 - $70.00 5.09 4,301,953 66.20 4,301,953 66.20 $70.01 - $77.99 3.59 2,372,411 75.94 2,372,411 75.94 Total 6.66 22,472,047 $ 48.99 14,309,944 $ 55.00 The weighted-average fair value of options granted during 2017, 2016 and 2015, was approximately $9.68, $6.44 and $15.41 per share, respectively, as determined using the Black-Scholes option-pricing model. The total intrinsic value of options exercised during 2017 and 2016 was $13 million and $4 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 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, 2017 2016 2015 Valuation Assumptions: Expected volatility 36.1 % 48.6 % 49.1 % Risk-free interest rate 2.2 % 1.2 % 1.5 % Expected dividend yield 0.6 % 6.5 % 3.4 % Expected term (in years) 3.0 3.0 3.0 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. Forfeitures are accounted for as they occur. The following summary presents information regarding outstanding options at December 31, 2017 and changes during 2017 with regard to options under all stock option plans: Weighted Weighted- Remaining Shares Exercise Term Aggregate Outstanding at December 31, 2016 17,439,060 $ 54.08 5.42 $ 6,700,856 Granted 6,961,041 $ 36.51 Forfeited (1,482,531 ) $ 55.22 Exercised (445,523 ) $ 29.83 Outstanding at December 31, 2017 22,472,047 $ 48.99 6.66 $ 34,186,368 Exercisable at December 31, 2017 14,309,944 $ 55.00 5.70 $ 15,557,324 At December 31, 2017, total unrecognized compensation cost related to nonvested stock options was $36 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 2017, 2016 and 2015 was approximately $70 million, $61 million and $72 million, respectively. Cash received from option exercises for 2017, 2016 and 2015 was $13 million, $4 million and $7 million, respectively. The actual tax benefit (expense) realized for the tax deductions from option exercises totaled $(2) million, nil and $3 million for 2017, 2016 and 2015, respectively. Stock Appreciation Rights On December 20, 2017, the Company made a tender offer to exchange SARs issued to certain employees on February 24, 2016 (“2016 SARs”) for cash, amended SARs, and new stock options. The transaction was structured to provide the employees an equal long-term incentive compensation value, while alleviating volatility in the Company’s earnings caused by required mark-to-market accounting on outstanding SARS. Of the outstanding 2016 SARs, 94.75% were exchanged resulting in a total cash payment of $14 million and granting of 3,613,707 new stock options on the exchange date with an exercise price of $34.32 and a fair value of $8.47, with vesting matched to the exchanged 2016 SARs. As a result of exchanging the 2016 SARs for cash and new stock options, the Company recorded $11 million of compensation expense and an increase of $20 million to additional paid-in capital in the fourth quarter of 2017. The following summary presents information regarding outstanding SARs: Year Ended December 31, 2017 2016 Number Average Number Average of Exercise of Exercise Shares Price Shares Price Shares under SARs at beginning of year 4,341,740 $ 28.32 — $ — Granted 14,400 38.86 4,618,400 28.32 Forfeited (283,822 ) 28.35 (276,660 ) 28.24 Exercised (2,578,629 ) 34.72 — — Shares under SARs at end of year 1,493,689 $ 28.41 4,341,740 $ 28.32 Exercisable at end of year 75,102 $ 28.33 — $ — As of December 31, 2017, there was $16 million of unrecognized compensation expense related to nonvested SARs, which is expected to be recognized over a weighted-average period of approximately two years. The expense recognized in 2017 and 2016 was $8 million and $20 million, respectively. The liability for cash-settled SARs was $2 million at December 31, 2017. Restricted Shares The Company issues restricted stock awards and restricted stock units to officers and key employees in addition to stock options. On February 22, 2017, the Company granted 1,504,450 shares of restricted stock and restricted stock units with a fair value of $38.86 per share; and performance share awards to senior management employees with potential payouts varying from zero to 388,380 shares. The restricted stock and restricted stock units vest on the third anniversary of the date of grant or in three equal annual installments commencing on the first 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 based entirely on a TSR (total shareholder return) goal. 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. On May 17, 2017, the Company granted 36,701 restricted stock awards with a fair value of $33.38 per share. The awards were granted to non-employee The following summary presents information regarding outstanding restricted shares: Years Ended December 31, 2017 2016 2015 Weighted- Weighted- Weighted- Number Average Number Average Number Average of Grant Date of Grant Date of Grant Date Units Fair Value Units Fair Value Units Fair Value Nonvested at beginning of year 4,563,983 $ 41.10 1,969,250 $ 61.53 1,569,141 $ 73.73 Granted 1,738,589 38.74 3,384,325 31.59 954,075 53.27 Vested (1,018,206 ) 34.84 (565,202 ) 29.32 (405,327 ) 54.30 Forfeited (394,688 ) 55.22 (224,390 ) 49.95 (148,639 ) 62.73 Nonvested at end of year 4,889,678 $ 37.04 4,563,983 $ 41.10 1,969,250 $ 61.53 The weighted-average grant day fair value of restricted stock awards and restricted stock units granted during the years ended 2017, 2016 and 2015 was $38.74, $31.59 and $53.27 per share, respectively. There were 1,018,206; 565,202 and 405,327 restricted stock awards that vested during 2017, 2016 and 2015, respectively. At December 31, 2017, there was approximately $99 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, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 14. Income Taxes On December 22, 2017 the United States enacted significant changes to the U.S. tax law following the passage and signing of H.R.1, “An Act to Provide the Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018” (the “Act”) (previously known as “The Tax Cuts and Jobs Act”). The Act reduces the U.S. federal corporate tax rate from 35% to 21% and requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred. The Act includes new anti-deferral provisions on Global Intangible Low Taxed Income (“GILTI”). Beginning in 2018 these provisions result in incremental taxability of our foreign subsidiaries income in excess of an allowed return on certain tangible property. The FASB has determined that filers have a policy choice to account for this tax on either a period basis or a deferred tax basis. We are still evaluating the impacts of GILTI on our business model and have not yet made any accounting adjustments or policy decisions regarding this new source of incremental US taxable income. Due to the timing of the enactment and the complexity involved in applying the provision of the Act, we have made reasonable estimates of the effects and recorded provisional amounts in our financial statement as of December 31, 2017. As we collect and prepare necessary data, and interpret the Act and any additional guidance issued by the U.S. Treasury Department, the IRS, and other standard-setting bodies, we may make adjustments to the provisional amounts. We recognized an income tax benefit of $242 million in the year ended December 31, 2017 associated with the revaluation of our net deferred tax liability. Our provisional estimate of the one-time transition tax resulted in no additional tax expense and has been considered in our disclosure of undistributed earnings. The accounting for the tax effects of the Act will be completed in 2018. The domestic and foreign components of income (loss) before income taxes were as follows (in millions): Years Ended December 31, 2017 2016 2015 Domestic $ (470 ) $ (2,095 ) $ (1,577 ) Foreign 78 (528 ) 988 $ (392 ) $ (2,623 ) $ (589 ) The components of the provision for income taxes consisted of (in millions): Years Ended December 31, 2017 2016 2015 Current: Federal $ 23 $ (79 ) $ 30 State 1 (4 ) (58 ) Foreign 161 74 464 Total current income tax provision 185 (9 ) 436 Deferred: Federal (332 ) (132 ) (41 ) State (2 ) (7 ) (38 ) Foreign (7 ) (59 ) (179 ) Total deferred income tax provision (341 ) (198 ) (258 ) Total income tax provision $ (156 ) $ (207 ) $ 178 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, 2017 2016 2015 Federal income tax at U.S. statutory rate $ (137 ) $ (918 ) $ (206 ) Foreign income tax rate differential (21 ) 32 (110 ) Goodwill impairment — 271 462 Nondeductible expenses 38 30 66 Foreign dividends, net of foreign tax credits (132 ) (25 ) 28 Tax rate change on timing differences (245 ) (8 ) (45 ) Change in uncertain tax positions 81 11 69 Prior years taxes (26 ) (29 ) (47 ) Tax impact on foreign exchange 5 (4 ) (46 ) Change in deferred tax valuation allowance 280 476 15 Other 1 (43 ) (8 ) Total income tax provision $ (156 ) $ (207 ) $ 178 The effective tax rate for the year ended December 31, 2017 was 39.8%, compared to 7.9% for 2016. For the year ended December 31, 2017, the revaluation of net deferred tax liabilities in the U.S. partially offset by valuation allowances established on foreign tax credits generated during the year, when applied to losses resulted in a higher effective tax rate than the U.S. statutory rate. For the year ended December 31, 2016, the impairment of goodwill not deductible for tax purposes, lower tax rates on losses incurred in foreign jurisdictions, and the establishment of valuation allowances, when applied to losses resulted in a lower effective tax rate than the U.S. statutory rate. Significant components of our deferred tax assets and liabilities were as follows (in millions): December 31, 2017 2016 Deferred tax assets: Allowances and operating liabilities $ 355 $ 534 Net operating loss carryforwards 182 153 Postretirement benefits 31 60 Tax credit carryforwards 1,002 405 Other 78 164 Valuation allowance (1,202 ) (544 ) Total deferred tax assets 446 772 Deferred tax liabilities: Tax over book depreciation 174 267 Intangible assets 716 1,148 Deferred income 111 185 Accrued tax on unremitted earnings 17 53 Other 92 97 Total deferred tax liabilities 1,110 1,750 Net deferred tax liability $ 664 $ 978 A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions): 2017 2016 2015 Unrecognized tax benefit at beginning of year $ 78 $ 46 $ 115 Gross increase for current period tax positions 10 3 8 Gross increase for tax positions in prior years 64 65 75 Gross decrease for tax positions in prior years (14 ) (21 ) (75 ) Settlements — (3 ) (69 ) Lapse of statute of limitations (6 ) (12 ) (8 ) Unrecognized tax benefit at end of year $ 132 $ 78 $ 46 The balance of unrecognized tax benefits at December 31, 2017, 2016 and 2015 was $132 million, $78 million and $46 million, respectively. Accruals related to foreign jurisdiction audits of prior years’ resulted in uncertain tax position increases of $64 million and $65 million in 2017 and 2016, respectively. For the year ended December 31, 2015 a $69 million uncertain tax position was identified in a foreign jurisdiction that was included as an increase and settlement during the year and the completion of audits in foreign jurisdictions resulted in a $75 million decrease in uncertain tax positions. Substantially all of the unrecognized tax benefits, if ultimately realized, would be recorded as a benefit to the effective tax rate. The Company anticipates that it is reasonably possible that the amount of unrecognized tax benefits may decrease by up to $75 million in the next twelve months due to settlements and conclusions of tax examinations. 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. For the years ended December 31, 2017, 2016 and 2015, we recorded income tax expense of $17 million, $10 million and $1 million, respectively, for interest and penalty related to unrecognized tax benefits. As of December 31, 2017 and 2016, the Company had accrued $32 million and $15 million, respectively, of interest and penalty relating to unrecognized tax benefits. 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 tax years ending after 2012 and outside the U.S. for tax years ending after 2010. Net operating loss carryforwards by jurisdiction and expiration as of December 31, 2017 were as follows (in millions): Federal State Foreign Total 2018 - 2021 Expiration $ 6 $ 2 $ 57 $ 65 2022 - 2033 Expiration 16 16 123 155 2034 - 2037 Expiration — 127 97 224 Unlimited Expiration — — 372 372 Total Net Operating Loss (NOL) $ 22 $ 145 $ 649 $ 816 Tax Effected NOL $ 5 $ 8 $ 169 $ 182 Valuation Allowance (VA) (4 ) (8 ) (145 ) (157 ) NOL Net of VA $ 1 $ — $ 24 $ 25 The Company has $658 million of excess foreign tax credits in the United States as of December 31, 2017, of which $11 million, $141 million, $287 million and $219 million will expire in 2020, 2022, 2026 and 2027, respectively. As of December 31, 2017, the Company has remaining tax-deductible goodwill of $153 million, resulting from acquisitions. The amortization of this goodwill is deductible over various periods ranging up to 13 years. Undistributed earnings of certain of the Company’s foreign subsidiaries amounted to $5,302 million at December 31, 2017. These earnings are considered to be indefinitely 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 incremental U.S. federal and state taxes at statutory rates and withholding taxes payable in various foreign countries. |
Business Segments and Geographi
Business Segments and Geographic Areas | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Business Segments and Geographic Areas | 15. Business Segments and Geographic Areas The Company’s operations are organized into three reportable segments: Wellbore Technologies, Completion & Production Solutions, and Rig Technologies. Within the three reporting segments, the Company has six business units under Wellbore Technologies, nine business units under Completion & Production Solutions and two under Rig Technologies, for a total of 17 business units. The Company has aggregated each of its business units in one of the three reporting segments based on the guidelines of ASC Topic 280, “Segment Reporting” (“ASC Topic 280”). 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, and manifolds; 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. Rig Technologies To achieve higher efficiencies and reduce costs in the current market, the Company combined the Rig Systems and Rig Aftermarket segments during the fourth quarter of 2017. See Note 2. The Company’s Rig Technologies 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 Technologies 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. The segment also provides spare parts, repair, and rentals as well as comprehensive remote equipment monitoring, technical support, field service, and customer training through an extensive network of aftermarket service and repair facilities strategically located in major areas of drilling operations around the world. Rig Technologies 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; and secondarily on the overall level of oilfield drilling activity, which drives demand for spare parts, service, and repair for the segment’s large installed base of equipment. The Company did not have any customers with revenues greater than 10% of total revenue for the years ended December 31, 2017, 2016, or 2015. The Company’s revenue from rentals for 2017, 2016 and 2015 was 12%, 8% and 7%, respectively, of total revenue. Geographic Areas: The following table presents consolidated revenues by country based on sales destination of the products or services (in millions): Years Ended December 31, 2017 2016 2015 United States $ 2,760 $ 1,961 $ 3,640 Brazil 498 242 605 Saudi Arabia 310 258 416 China 298 557 1,623 Norway 295 339 555 Canada 286 217 365 United Kingdom 279 299 634 South Korea 261 495 1,835 United Arab Emirates 223 334 532 Singapore 188 340 1,035 Other Countries 1,906 2,209 3,517 Total $ 7,304 $ 7,251 $ 14,757 The following table presents long-lived assets by country based on the location (in millions): December 31, 2017 2016 United States $ 1,675 $ 1,810 Brazil 269 281 United Kingdom 140 137 Denmark 128 120 South Korea 97 94 Russia 90 88 Canada 84 82 Mexico 71 77 United Arab Emirates 65 90 Singapore 59 63 Other Countries 324 308 Total $ 3,002 $ 3,150 Business Segments: The following table presents selected financial data by business segment (in millions): Wellbore Completion & Production Rig Eliminations and Total December 31, 2017 Revenue $ 2,577 $ 2,672 $ 2,252 $ (197 ) $ 7,304 Operating profit (loss) (102 ) 98 (14 ) (259 ) (277 ) Capital expenditures 99 69 16 8 192 Depreciation and amortization 379 215 88 16 698 Goodwill 2,956 2,122 1,149 — 6,227 Total assets 7,848 5,782 4,625 1,951 20,206 December 31, 2016 Revenue $ 2,199 $ 2,241 $ 3,110 $ (299 ) $ 7,251 Operating profit (770 ) (266 ) (1,033 ) (342 ) (2,411 ) Capital expenditures 124 61 24 75 284 Depreciation and amortization 384 209 94 16 703 Goodwill 2,874 2,058 1,135 — 6,067 Total assets 7,911 5,765 5,327 2,137 21,140 December 31, 2015 Revenue $ 3,718 $ 3,365 $ 8,279 $ (605 ) $ 14,757 Operating profit (1,573 ) 187 1,501 (505 ) (390 ) Capital expenditures 180 87 91 95 453 Depreciation and amortization 403 223 107 14 747 Goodwill 2,874 1,997 2,109 — 6,980 Total assets 8,766 5,916 9,227 2,061 25,970 (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 and corporate costs include intercompany transactions conducted between the three reporting segments that are eliminated in consolidation, as well as corporate costs not allocated to the segments. Intercompany transactions within each reporting segment are eliminated within each reporting segment. Also included in the eliminations and corporate costs column are capital expenditures and total assets related to corporate. Corporate assets consist primarily of cash and fixed assets. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | 16. Quarterly Financial Data (Unaudited) Summarized quarterly results, were as follows (in millions, except per share data): First Second Third Fourth Quarter Quarter Quarter Quarter Year ended December 31, 2017 Revenue $ 1,741 $ 1,759 $ 1,835 $ 1,969 Gross profit 209 231 285 167 Net loss attributable to Company (122 ) (75 ) (26 ) (14 ) Net loss attributable to Company per basic share (0.32 ) (0.20 ) (0.07 ) (0.04 ) Net loss attributable to Company per diluted share (0.32 ) (0.20 ) (0.07 ) (0.04 ) Cash dividends per share 0.05 0.05 0.05 0.05 Year ended December 31, 2016 Revenue $ 2,189 $ 1,724 $ 1,646 $ 1,692 Gross profit (loss) 244 35 79 (459 ) Net loss attributable to Company (119 ) (217 ) (1,362 ) (714 ) Net loss attributable to Company per basic share (0.32 ) (0.58 ) (3.62 ) (1.90 ) Net loss attributable to Company per diluted share (0.32 ) (0.58 ) (3.62 ) (1.90 ) Cash dividends per share 0.46 0.05 0.05 0.05 |
Schedule II National Oilwell Va
Schedule II National Oilwell Varco, Inc. Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2017 | |
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, 2016, 2015 and 2014 (in millions) Balance Additions Charge off’s Balance Allowance for doubtful accounts: 2017 $ 209 $ 6 $ (28 ) $ 187 2016 159 52 (2 ) 209 2015 125 77 (43 ) 159 Reserve for excess and obsolete inventories: 2017 $ 1,017 $ 114 $ (331 ) $ 800 2016 500 606 (89 ) 1,017 2015 370 186 (56 ) 500 Valuation allowance for deferred tax assets: 2017 $ 544 $ 280 $ 378 $ 1,202 2016 63 476 5 544 2015 48 15 — 63 Warranty reserve: 2017 $ 172 $ 46 $ (83 ) $ 135 2016 244 50 (122 ) 172 2015 272 92 (120 ) 244 |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
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 |
Inventories | Inventories Inventories consist of raw materials, work-in-process first-in, first-out on-hand, The Company evaluates inventory quarterly using the best information available at the time to inform our assumptions and estimates about future demand and resulting sales volumes, and recognizes reserves as necessary to properly state inventory. The historically severe oil-industry mid-2014 Based on an update of our assumptions at each point in time related to estimates of future demand, during 2017 and 2016 we recorded charges for additions to inventory reserves of $114 million and $606 million, respectively, consisting primarily of obsolete and surplus inventories. At December 31, 2017 and 2016, inventory reserves totaled $800 million and $1,017 million, or 21.0% and 23.4% of gross inventory, respectively. |
Asset Impairment | Asset Impairment Generally Accepted Accounting Principles require the Company test goodwill and other indefinite-lived intangible assets for impairment at least annually or more frequently whenever events or circumstances occur indicating that those assets might be impaired. Prior to 2017, the impairment analysis was a two-step process as the Company early adopted Accounting Standard Update No. 2017-04 “Simplifying the Test for Goodwill Impairment,” which eliminates step two effective July 1, 2017. The impairment analysis compares the reporting unit’s carrying value to the respective fair value. Fair value of the reporting unit 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. The discounted cash flow is based on management’s forecast of operating performance for the 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 reporting unit and its 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. Cash flows beyond the updated forecasted 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. Based on the Company’s step one impairment analysis, as of July 1, 2016, completed as a result of market indicators identified in the third quarter, the Rig Offshore reporting unit had a calculated fair value below its carrying value, and required a step two analysis, which compares the implied fair value of goodwill of a reporting unit to the carrying value of goodwill for the reporting unit. 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. Consistent with the step one analysis, fair value of the assets and liabilities was determined in accordance with ASC Topic 820. Based on the step two analysis performed for the Rig Offshore reporting unit, the Company recorded a $972 million write-down of goodwill during the third quarter. On July 1, 2017, the Company’s Wellbore Technologies segment reorganized three of its reporting units, moving various operations between them. The goodwill impairment analyses performed prior to and subsequent to the restructuring of the three reporting units, concluded that the calculated fair values of these reporting units were substantially in excess of their carrying value. The restructuring had no effect on Wellbore Technologies consolidated financial position and results of operations. The Company combined its Rig Systems and Rig Aftermarket reporting units into two different reporting units, Rig Equipment and Marine Construction, under a segment called Rig Technologies, effective October 1, 2017. The restructuring better aligns operations with the current and anticipated market environments, reduces administrative burden, and eliminates reported intercompany transactions between Rig Technologies’ capital equipment and aftermarket operations. The Company tested the Rig Systems and Rig Aftermarket reporting units for impairment prior to combining, and the two, new reporting units under the Rig Technologies segment for impairment after combining, and concluded all fair values of the reporting units were substantially in excess of their carrying values. During the fourth quarter of 2017, the Company performed its annual impairment test, as described in ASC Topic 350, as of October 1, 2017. Based on the Company’s annual impairment test, the calculated fair values for all of the Company’s reporting units were substantially in excess of the respective reporting unit’s carrying value. Additionally, the fair value for all of the Company’s intangible assets with indefinite lives were substantially in excess of the respective asset carrying values. |
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, which includes the amortization of assets recorded under capital leases, was $359 million, $370 million and $391 million for the years ended December 31, 2017, 2016 and 2015, respectively. Accumulated depreciation of $2,559 million as of December 31, 2017 included accumulated depreciation of $18 million for capital leases. 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 were $10 million and $54 million in impairments of long-lived assets for the years ended December 31, 2017 and 2016, respectively, and nil for the year ended December 31, 2015. |
Intangible Assets | Intangible Assets The Company has approximately $6.2 billion of goodwill and $3.3 billion of identified intangible assets at December 31, 2017. Goodwill is identified by segment as follows (in millions): Wellbore Completion & Rig Total Balance at December 31, 2015 $ 2,874 $ 1,997 $ 2,109 $ 6,980 Goodwill acquired and adjusted during period 4 70 — 74 Impairment — — (972 ) (972 ) Currency translation adjustments (4 ) (9 ) (2 ) (15 ) Balance at December 31, 2016 $ 2,874 $ 2,058 $ 1,135 $ 6,067 Goodwill acquired and adjusted during period 37 41 11 89 Currency translation adjustments 45 23 3 71 Balance at December 31, 2017 (1) $ 2,956 $ 2,122 $ 1,149 $ 6,227 (1) Accumulated goodwill impairment was $2,457 million as of December 31, 2017. 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. The net book values of identified intangible assets are identified by segment as follows (in millions): Wellbore Completion & Rig Total Balance at December 31, 2015 $ 2,254 $ 1,296 $ 299 $ 3,849 Additions to intangible assets 15 9 — 24 Amortization (205 ) (106 ) (22 ) (333 ) Currency translation adjustments — (8 ) (2 ) (10 ) Balance at December 31, 2016 $ 2,064 $ 1,191 $ 275 $ 3,530 Additions to intangible assets 18 41 2 61 Amortization (208 ) (108 ) (23 ) (339 ) Currency translation adjustments 9 36 4 49 Balance at December 31, 2017 $ 1,883 $ 1,160 $ 258 $ 3,301 Identified intangible assets by major classification consist of the following (in millions): Gross Accumulated Net Book December 31, 2016: Customer relationships $ 4,024 $ (1,874 ) $ 2,150 Trademarks 878 (290 ) 588 Patents 585 (345 ) 240 Indefinite-lived trade names 384 — 384 Other 463 (295 ) 168 Total identified intangibles $ 6,334 $ (2,804 ) $ 3,530 December 31, 2017: Customer relationships $ 4,074 $ (2,118 ) $ 1,956 Trademarks 885 (317 ) 568 Patents 602 (384 ) 218 Indefinite-lived trade names 384 — 384 Other 499 (324 ) 175 Total identified intangibles $ 6,444 $ (3,143 ) $ 3,301 |
Foreign Currency | Foreign Currency Certain foreign operations, including our operations in Norway, use the U.S. dollar as the functional 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. 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 $(3) million, $(10) million and $(47) million for the years ending December 31, 2017, 2016 and 2015, 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 quarter of 2015, the Venezuelan government officially devalued the Venezuelan bolivar against the U.S. dollar. As a result, the Company incurred approximately $9 million in devaluation charges in the first quarter of 2015. 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 nil at December 31, 2017. 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 costs 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 Completion & Production Solutions and Rig Technologies 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, 2015 $ 244 Net provisions for warranties issued during the year 50 Amounts incurred (127 ) Currency translation adjustments and other 5 Balance at December 31, 2016 $ 172 Net provisions for warranties issued during the year 46 Amounts incurred (86 ) Currency translation adjustments and other 3 Balance at December 31, 2017 $ 135 |
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 $187 million and $209 million at December 31, 2017 and 2016, respectively. |
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 |
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, |
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 Loss Attributable to Company Per Share | Net Loss 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, 2017 2016 2015 Numerator: Net loss attributable to Company $ (237 ) $ (2,412 ) $ (769 ) Denominator: Basic—weighted average common shares outstanding 377 376 387 Dilutive effect of employee stock options and other unvested stock awards — — — Diluted outstanding shares 377 376 387 Basic loss attributable to Company per share $ (0.63 ) $ (6.41 ) $ (1.99 ) Diluted loss attributable to Company per share $ (0.63 ) $ (6.41 ) $ (1.99 ) Cash dividends per share $ 0.20 $ 0.61 $ 1.84 ASC Topic 260, “Earnings Per Share” (“ASC Topic 260”) requires companies with unvested participating securities to utilize a two-class two-class non-forfeitable |
Recently Adopted and Issued Accounting Standards | Recently Issued Accounting Standards In August 2017, the FASB issued Accounting Standard Update No. 2017-12 2017-12). 2017-12 2017-12. No. 2017-12 In March 2017, the FASB issued Accounting Standard Update No. 2017-07 2017-07). 2017-07 No. 2017-07 In August 2016, the FASB issued Accounting Standard Update No. 2016-15 2016-15). No. 2016-15 No. 2016-15 In March 2016, the FASB issued ASC Topic 842, “Leases” (ASC Topic 842), which supersedes the lease requirements in ASC Topic No. 840 “Leases” and most industry-specific guidance. This update increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASC Topic 842 is effective for fiscal years beginning after December 15, 2018, and for interim periods within those fiscal years. In preparing for the adoption of this new standard, the Company has established an internal team to centralize the implementation process as well as engaged external resources to assist in our approach. We are currently utilizing a software program to consolidate and accumulate leases with documentation as required by the new standard. We have assessed the changes to the Company’s current accounting practices and are currently investigating the related tax impact and process changes. We are also in the process of quantifying the impact of the new standard on our balance sheet. In May 2014, the FASB issued Accounting Standard Update No. 2014-09, 2014-09), The standard permits either a full retrospective adoption, in which the standard is applied to all the periods presented, or a modified retrospective adoption, in which the standard is applied only to the current period with a cumulative-effect adjustment reflected in retained earnings. ASU 2014-09 In 2015, the Company assembled an internal team to study the provisions of ASU 2014-09, Based on an analysis of revenue streams, customer contracts and transactions, the Company does not expect a material change in the timing or other impacts to revenue recognition across most of our businesses. Certain service and repair revenue will change from point-in-time to over-time revenue recognition, and the timing of including uninstalled materials in projects will shift, changing only the timing of revenue recognition and not the total amount. We expect the cumulative-effect adjustment we will record in the first quarter of 2018, as required by the modified retrospective method, to be less than $50 million. The final adjustment is subject to concluding on the available practical expediants. |
Summary of Significant Accoun27
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Goodwill Identified by Segment | Goodwill is identified by segment as follows (in millions): Wellbore Completion & Rig Total Balance at December 31, 2015 $ 2,874 $ 1,997 $ 2,109 $ 6,980 Goodwill acquired and adjusted during period 4 70 — 74 Impairment — — (972 ) (972 ) Currency translation adjustments (4 ) (9 ) (2 ) (15 ) Balance at December 31, 2016 $ 2,874 $ 2,058 $ 1,135 $ 6,067 Goodwill acquired and adjusted during period 37 41 11 89 Currency translation adjustments 45 23 3 71 Balance at December 31, 2017 (1) $ 2,956 $ 2,122 $ 1,149 $ 6,227 (1) Accumulated goodwill impairment was $2,457 million as of December 31, 2017. |
Identified Intangible Assets Identified by Segment | The net book values of identified intangible assets are identified by segment as follows (in millions): Wellbore Completion & Rig Total Balance at December 31, 2015 $ 2,254 $ 1,296 $ 299 $ 3,849 Additions to intangible assets 15 9 — 24 Amortization (205 ) (106 ) (22 ) (333 ) Currency translation adjustments — (8 ) (2 ) (10 ) Balance at December 31, 2016 $ 2,064 $ 1,191 $ 275 $ 3,530 Additions to intangible assets 18 41 2 61 Amortization (208 ) (108 ) (23 ) (339 ) Currency translation adjustments 9 36 4 49 Balance at December 31, 2017 $ 1,883 $ 1,160 $ 258 $ 3,301 |
Identified Intangible Assets by Major Classification | Identified intangible assets by major classification consist of the following (in millions): Gross Accumulated Net Book December 31, 2016: Customer relationships $ 4,024 $ (1,874 ) $ 2,150 Trademarks 878 (290 ) 588 Patents 585 (345 ) 240 Indefinite-lived trade names 384 — 384 Other 463 (295 ) 168 Total identified intangibles $ 6,334 $ (2,804 ) $ 3,530 December 31, 2017: Customer relationships $ 4,074 $ (2,118 ) $ 1,956 Trademarks 885 (317 ) 568 Patents 602 (384 ) 218 Indefinite-lived trade names 384 — 384 Other 499 (324 ) 175 Total identified intangibles $ 6,444 $ (3,143 ) $ 3,301 |
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, 2015 $ 244 Net provisions for warranties issued during the year 50 Amounts incurred (127 ) Currency translation adjustments and other 5 Balance at December 31, 2016 $ 172 Net provisions for warranties issued during the year 46 Amounts incurred (86 ) Currency translation adjustments and other 3 Balance at December 31, 2017 $ 135 |
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, 2017 2016 2015 Numerator: Net loss attributable to Company $ (237 ) $ (2,412 ) $ (769 ) Denominator: Basic—weighted average common shares outstanding 377 376 387 Dilutive effect of employee stock options and other unvested stock awards — — — Diluted outstanding shares 377 376 387 Basic loss attributable to Company per share $ (0.63 ) $ (6.41 ) $ (1.99 ) Diluted loss attributable to Company per share $ (0.63 ) $ (6.41 ) $ (1.99 ) Cash dividends per share $ 0.20 $ 0.61 $ 1.84 |
Derivative Financial Instrume28
Derivative Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 December 31, 2016 Norwegian Krone NOK 4,013 NOK 5,621 Japanese Yen JPY 982 JPY 1,462 U.S. Dollar USD 163 USD 321 Euro EUR 120 EUR 279 Danish Krone DKK 30 DKK 29 British Pound Sterling GBP 11 GBP 1 Singapore Dollar SGD — SGD 2 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, 2017 December 31, 2016 Russian Ruble RUB 2,699 RUB 1,893 Norwegian Krone NOK 1,734 NOK 538 U.S. Dollar USD 463 USD 457 South African Rand ZAR 150 ZAR 150 Euro EUR 99 EUR 272 Danish Krone DKK 15 DKK 49 British Pound Sterling GBP 3 GBP 3 Singapore Dollar SGD — SGD 7 Canadian Dollar CAD — CAD 1 |
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 Fair Value Balance Sheet Fair Value Location 2017 2016 Location 2017 2016 Derivatives designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 13 $ 24 Accrued liabilities $ 3 $ 37 Foreign exchange contracts Other Assets 8 6 Other Liabilities 2 11 Total derivatives designated as hedging instruments under ASC Topic 815 $ 21 $ 30 $ 5 $ 48 Derivatives not designated as hedging instruments under ASC Topic 815 Foreign exchange contracts Prepaid and other current assets $ 10 $ 32 Accrued liabilities $ 5 $ 29 Foreign exchange contracts Other Assets 2 — Other Liabilities 1 — Total derivatives not designated as hedging instruments under ASC Topic 815 $ 12 $ 32 $ 6 $ 29 Total derivatives $ 33 $ 62 $ 11 $ 77 |
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 Designated as Hedging Instruments under ASC Topic 815 Amount of Gain (Loss) Recognized in OCI on Location of Gain (Loss) (Effective Portion) Amount of Gain (Loss) Location of Gain (Loss) Testing) Amount of Gain (Loss) Years Ended December 31, Years Ended December 31, Years Ended December 31, 2017 2016 2017 2016 2017 2016 Revenue 8 5 Cost of revenue 7 (21 ) Foreign exchange contracts 56 45 Cost of (19 ) (170 ) Other income 2 8 Total 56 45 (11 ) (165 ) 9 (13 ) Derivatives Not Designated as Location of Gain (Loss) Amount of Gain (Loss) Hedging Instruments under Recognized in Income Recognized in Income on ASC Topic 815 on Derivatives Derivatives Years Ended December 31, 2017 2016 Foreign exchange contracts Other income (expense), net 58 (33 ) Total 58 (33 ) (a) The Company expects that $5 million of the Accumulated Other Comprehensive Income (Loss) will be reclassified into earnings within the next twelve months with an offset by losses from the underlying transactions resulting in no impact to earnings or cash flow. (b) The amount of gain (loss) recognized in income represents $7 million and $(21) million related to the ineffective portion of the hedging relationships for the years ended December 31, 2017 and 2016, respectively, and $2 million and $8 million related to the amount excluded from the assessment of the hedge effectiveness for the years ended December 31, 2017 and 2016, respectively. |
Acquisitions and Investments (T
Acquisitions and Investments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Summary of Acquisitions | A summary of the acquisitions follows (in millions): Years Ended December 31, 2017 2016 2015 Fair value of assets acquired, net of cash acquired $ 154 $ 357 $ 116 Cash paid, net of cash acquired (86 ) (230 ) (86 ) Liabilities assumed, debt issued and noncontrolling interest $ 68 $ 127 $ 30 Excess purchase price over fair value of net assets acquired $ 89 $ 74 $ 51 |
Inventories, net (Tables)
Inventories, net (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consist of (in millions): December 31, 2017 2016 Raw materials and supplies $ 656 $ 961 Work in process 513 561 Finished goods and purchased products 1,834 1,803 Total $ 3,003 $ 3,325 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consist of (in millions): Estimated Useful Lives December 31, 2017 2016 Land and buildings 5-35 Years $ 1,592 $ 1,570 Operating equipment 3-15 3,169 3,102 Rental equipment 3-12 581 557 Capital leases 20-24 Years 219 219 5,561 5,448 Less: Accumulated Depreciation (2,559 ) (2,298 ) $ 3,002 $ 3,150 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued liabilities consist of (in millions): December 31, 2017 2016 Vendor costs $ 150 $ 235 Customer prepayments and billings 240 222 Compensation 345 181 Taxes (non income) 152 176 Warranty 135 172 Insurance 74 103 Fair value of derivatives 8 66 Commissions 58 57 Interest 7 8 Other 309 348 Total $ 1,478 $ 1,568 |
Costs and Estimated Earnings 33
Costs and Estimated Earnings on Uncompleted Contracts (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Text Block [Abstract] | |
Costs and Estimated Earnings on Uncompleted Contracts | Costs and estimated earnings on uncompleted contracts consist of (in millions): December 31, 2017 2016 Costs incurred on uncompleted contracts $ 6,395 $ 8,132 Estimated earnings 3,023 3,869 9,418 12,001 Less: Billings to date on uncompleted contracts 9,202 11,776 $ 216 $ 225 Costs and estimated earnings in excess of billings on uncompleted contracts $ 495 $ 665 Billings in excess of costs and estimated earnings on uncompleted contracts (279 ) (440 ) $ 216 $ 225 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt consists of (in millions): December 31, 2017 2016 $500 million in Senior Notes, interest at 1.35% payable semiannually, principal due on December 1, 2017 — 499 $1.4 billion in Senior Notes, interest at 2.60% payable semiannually, principal due on December 1, 2022 1,392 1,391 $1.1 billion in Senior Notes, interest at 3.95% payable semiannually, principal due on December 1, 2042 1,088 1,087 Capital Leases and other debt 232 237 Total debt 2,712 3,214 Less current portion 6 506 Long-term debt $ 2,706 $ 2,708 |
Principal Payments of Debt and Capital Leases | Principal payments of debt and capital leases for years subsequent to 2017 are as follows (in millions): 2018 $ 6 2019 5 2020 5 2021 5 2022 1,405 Thereafter 1,286 $ 2,712 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [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, 2017 and 2016, is as follows (in millions): Pension benefits Postretirement benefits At year end 2017 2016 2017 2016 Benefit obligation at beginning of year $ 622 $ 703 $ 92 $ 90 Service cost 1 5 — — Interest cost 20 25 3 3 Actuarial loss (gain) 6 42 (17 ) (29 ) Benefits paid (31 ) (30 ) (14 ) (16 ) Participants contributions — — 2 2 Exchange rate loss (gain) 30 (37 ) — — Acquisitions (disposals) — 2 — — Curtailments — (17 ) (4 ) — Settlements (15 ) (71 ) — — Other — — — 42 Benefit obligation at end of year $ 633 $ 622 $ 62 $ 92 Fair value of plan assets at beginning of year $ 543 $ 601 $ — $ — Actual return 57 60 — — Benefits paid (31 ) (30 ) (14 ) (16 ) Company contributions 11 16 12 14 Participants contributions — — 2 2 Exchange rate gain (loss) 24 (34 ) — — Settlements (15 ) (71 ) — — Acquisitions (disposals) — 1 — — Other (1 ) — — — Fair value of plan assets at end of year $ 588 $ 543 $ — $ — Funded status $ (45 ) $ (79 ) $ (62 ) $ (92 ) Accumulated benefit obligation at end of year $ 630 $ 617 |
Assumption Rates Used for Benefit Obligations | The assumption rates used for benefit obligations are as follows: Years Ended December 31, 2017 2016 Discount rate: United States plan 3.00% - 3.60% 3.10% - 4.00% International plans 1.80% - 2.40% 1.80% - 2.80% Salary increase: United States plan N/A N/A International plans 1.80% - 3.30% 1.80% - 3.50% |
Assumption Rates Used for Net Periodic Benefit Costs | The assumption rates used for net periodic benefit costs are as follows: Years Ended December 31, 2017 2016 2015 Discount rate: United States plan 3.10% - 4.00% 3.20% - 4.20% 3.70% - 4.20% International plans 1.80% - 2.80% 2.20% - 3.70% 2.20% - 3.70% Salary increase: United States plan N/A N/A N/A International plans 1.80% - 3.50% 2.00% - 4.20% 2.00% - 4.20% Expected return on assets: United States plan 5.60% 5.60% 5.50% International plans 1.80% - 3.00% 1.80% - 3.00% 2.30% - 5.12% |
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, 2016: Equity securities $ 181 $ — $ 181 $ — Bonds 262 — 262 — Other (insurance contracts) 100 — 47 53 Total Fair Value Measurements $ 543 $ — $ 490 $ 53 December 31, 2017: Equity securities $ 161 $ — $ 161 $ — Bonds 284 — 284 — Other (insurance contracts) 143 — 82 61 Total Fair Value Measurements $ 588 $ — $ 527 $ 61 |
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 Plan Assets Balance at December 31, 2015 $ 99 Actual return on plan assets still held at reporting date 5 Purchases, sales and settlements (50 ) Currency translation adjustments (1 ) Balance at December 31, 2016 $ 53 Actual return on plan assets still held at reporting date 2 Purchases, sales and settlements (1 ) Currency translation adjustments 7 Balance at December 31, 2017 $ 61 |
Accumulated Other Comprehensi36
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 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 ) Accumulated other comprehensive income (loss) before reclassifications (97 ) 32 35 (30 ) Amounts reclassified from accumulated other comprehensive income (loss) — 134 (3 ) 131 Balance at December 31, 2016 $ (1,376 ) $ (39 ) $ (37 ) $ (1,452 ) Accumulated other comprehensive income (loss) before reclassifications 272 41 25 338 Amounts reclassified from accumulated other comprehensive income (loss) — 5 (1 ) 4 Balance at December 31, 2017 $ (1,104 ) $ 7 $ (13 ) $ (1,110 ) |
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, 2017 2016 2015 Currency Derivative Defined Total Currency Derivative Defined Total Currency Derivative Defined Total Revenue $ — $ (8 ) $ — $ (8 ) $ — $ (5 ) $ — $ (5 ) $ — $ (19 ) $ — $ (19 ) Cost of revenue — 12 — 12 — 191 — 191 — 295 — 295 Selling, general, and administrative — — (1 ) (1 ) — — (5 ) (5 ) — — (6 ) (6 ) Tax effect — 1 — 1 — (52 ) 2 (50 ) — (77 ) 2 (75 ) $ — $ 5 $ (1 ) $ 4 $ — $ 134 $ (3 ) $ 131 $ — $ 199 $ (4 ) $ 195 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Commitments Under Capital Leases and Noncancellable Operating Leases with Initial or Remaining Terms of One Year or More | Future minimum lease commitments under capital leases and noncancellable operating leases with initial or remaining terms of one year or more at December 31, 2017, are payable as follows (in millions): Capital Lease Operating Lease 2018 $ 15 $ 130 2019 15 98 2020 15 82 2021 15 67 2022 15 55 Thereafter 273 339 Total future lease commitments $ 348 $ 771 |
Common Stock (Tables)
Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Summary of Stock Options | The following summarizes options activity: Years Ended December 31, 2017 2016 2015 Number Average Number Average Number Average of Exercise of Exercise of Exercise Shares Price Shares Price Shares Price Shares under option at beginning of year 17,439,060 $ 54.08 15,430,307 $ 59.50 10,881,133 $ 61.22 Granted 6,961,041 36.51 3,672,411 28.26 5,746,153 54.74 Forfeited (1,482,531 ) 55.22 (1,517,065 ) 49.95 (886,356 ) 62.73 Exercised (445,523 ) 29.83 (146,593 ) 28.53 (310,623 ) 22.56 Shares under option at end of year 22,472,047 $ 48.99 17,439,060 $ 54.08 15,430,307 $ 59.50 Exercisable at end of year 14,309,944 $ 55.00 9,828,897 $ 61.56 7,498,414 $ 60.30 |
Summary of Stock Option Outstanding Information | The following summarizes information about stock options outstanding at December 31, 2017: Weighted-Avg Options Outstanding Options Exercisable Remaining Weighted-Avg Weighted-Avg Range of Exercise Price Contractual Life Shares Exercise Price Shares Exercise Price $23.94 - $55.00 7.55 15,797,683 $ 40.25 7,635,580 $ 42.19 $55.01 - $70.00 5.09 4,301,953 66.20 4,301,953 66.20 $70.01 - $77.99 3.59 2,372,411 75.94 2,372,411 75.94 Total 6.66 22,472,047 $ 48.99 14,309,944 $ 55.00 |
Assumption Used in Determination of Fair Value of Share Based Payment Awards | The use of the Black Scholes model requires the use of 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, 2017 2016 2015 Valuation Assumptions: Expected volatility 36.1 % 48.6 % 49.1 % Risk-free interest rate 2.2 % 1.2 % 1.5 % Expected dividend yield 0.6 % 6.5 % 3.4 % Expected term (in years) 3.0 3.0 3.0 |
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, 2017 and changes during 2017 with regard to options under all stock option plans: Weighted Weighted- Remaining Shares Exercise Term Aggregate Outstanding at December 31, 2016 17,439,060 $ 54.08 5.42 $ 6,700,856 Granted 6,961,041 $ 36.51 Forfeited (1,482,531 ) $ 55.22 Exercised (445,523 ) $ 29.83 Outstanding at December 31, 2017 22,472,047 $ 48.99 6.66 $ 34,186,368 Exercisable at December 31, 2017 14,309,944 $ 55.00 5.70 $ 15,557,324 |
Summary of Information Regarding Outstanding SARs | The following summary presents information regarding outstanding SARs: Year Ended December 31, 2017 2016 Number Average Number Average of Exercise of Exercise Shares Price Shares Price Shares under SARs at beginning of year 4,341,740 $ 28.32 — $ — Granted 14,400 38.86 4,618,400 28.32 Forfeited (283,822 ) 28.35 (276,660 ) 28.24 Exercised (2,578,629 ) 34.72 — — Shares under SARs at end of year 1,493,689 $ 28.41 4,341,740 $ 28.32 Exercisable at end of year 75,102 $ 28.33 — $ — |
Summary of Information Regarding Outstanding Restricted Shares | The following summary presents information regarding outstanding restricted shares: Years Ended December 31, 2017 2016 2015 Weighted- Weighted- Weighted- Number Average Number Average Number Average of Grant Date of Grant Date of Grant Date Units Fair Value Units Fair Value Units Fair Value Nonvested at beginning of year 4,563,983 $ 41.10 1,969,250 $ 61.53 1,569,141 $ 73.73 Granted 1,738,589 38.74 3,384,325 31.59 954,075 53.27 Vested (1,018,206 ) 34.84 (565,202 ) 29.32 (405,327 ) 54.30 Forfeited (394,688 ) 55.22 (224,390 ) 49.95 (148,639 ) 62.73 Nonvested at end of year 4,889,678 $ 37.04 4,563,983 $ 41.10 1,969,250 $ 61.53 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Domestic and Foreign Components of Income (Loss) Before Income Taxes | The domestic and foreign components of income (loss) before income taxes were as follows (in millions): Years Ended December 31, 2017 2016 2015 Domestic $ (470 ) $ (2,095 ) $ (1,577 ) Foreign 78 (528 ) 988 $ (392 ) $ (2,623 ) $ (589 ) |
Components of Provision for Income Taxes | The components of the provision for income taxes consisted of (in millions): Years Ended December 31, 2017 2016 2015 Current: Federal $ 23 $ (79 ) $ 30 State 1 (4 ) (58 ) Foreign 161 74 464 Total current income tax provision 185 (9 ) 436 Deferred: Federal (332 ) (132 ) (41 ) State (2 ) (7 ) (38 ) Foreign (7 ) (59 ) (179 ) Total deferred income tax provision (341 ) (198 ) (258 ) Total income tax provision $ (156 ) $ (207 ) $ 178 |
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, 2017 2016 2015 Federal income tax at U.S. statutory rate $ (137 ) $ (918 ) $ (206 ) Foreign income tax rate differential (21 ) 32 (110 ) Goodwill impairment — 271 462 Nondeductible expenses 38 30 66 Foreign dividends, net of foreign tax credits (132 ) (25 ) 28 Tax rate change on timing differences (245 ) (8 ) (45 ) Change in uncertain tax positions 81 11 69 Prior years taxes (26 ) (29 ) (47 ) Tax impact on foreign exchange 5 (4 ) (46 ) Change in deferred tax valuation allowance 280 476 15 Other 1 (43 ) (8 ) Total income tax provision $ (156 ) $ (207 ) $ 178 |
Significant Components of Deferred Tax Assets and Liability | Significant components of our deferred tax assets and liabilities were as follows (in millions): December 31, 2017 2016 Deferred tax assets: Allowances and operating liabilities $ 355 $ 534 Net operating loss carryforwards 182 153 Postretirement benefits 31 60 Tax credit carryforwards 1,002 405 Other 78 164 Valuation allowance (1,202 ) (544 ) Total deferred tax assets 446 772 Deferred tax liabilities: Tax over book depreciation 174 267 Intangible assets 716 1,148 Deferred income 111 185 Accrued tax on unremitted earnings 17 53 Other 92 97 Total deferred tax liabilities 1,110 1,750 Net deferred tax liability $ 664 $ 978 |
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): 2017 2016 2015 Unrecognized tax benefit at beginning of year $ 78 $ 46 $ 115 Gross increase for current period tax positions 10 3 8 Gross increase for tax positions in prior years 64 65 75 Gross decrease for tax positions in prior years (14 ) (21 ) (75 ) Settlements — (3 ) (69 ) Lapse of statute of limitations (6 ) (12 ) (8 ) Unrecognized tax benefit at end of year $ 132 $ 78 $ 46 |
Summary of Net Operating Loss Carryforwards | Net operating loss carryforwards by jurisdiction and expiration as of December 31, 2017 were as follows (in millions): Federal State Foreign Total 2018 - 2021 Expiration $ 6 $ 2 $ 57 $ 65 2022 - 2033 Expiration 16 16 123 155 2034 - 2037 Expiration — 127 97 224 Unlimited Expiration — — 372 372 Total Net Operating Loss (NOL) $ 22 $ 145 $ 649 $ 816 Tax Effected NOL $ 5 $ 8 $ 169 $ 182 Valuation Allowance (VA) (4 ) (8 ) (145 ) (157 ) NOL Net of VA $ 1 $ — $ 24 $ 25 |
Business Segments and Geograp40
Business Segments and Geographic Areas (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Revenues by Country Based on Sales Destination of Products or Services | The following table presents consolidated revenues by country based on sales destination of the products or services (in millions): Years Ended December 31, 2017 2016 2015 United States $ 2,760 $ 1,961 $ 3,640 Brazil 498 242 605 Saudi Arabia 310 258 416 China 298 557 1,623 Norway 295 339 555 Canada 286 217 365 United Kingdom 279 299 634 South Korea 261 495 1,835 United Arab Emirates 223 334 532 Singapore 188 340 1,035 Other Countries 1,906 2,209 3,517 Total $ 7,304 $ 7,251 $ 14,757 |
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, 2017 2016 United States $ 1,675 $ 1,810 Brazil 269 281 United Kingdom 140 137 Denmark 128 120 South Korea 97 94 Russia 90 88 Canada 84 82 Mexico 71 77 United Arab Emirates 65 90 Singapore 59 63 Other Countries 324 308 Total $ 3,002 $ 3,150 |
Business Segments | The following table presents selected financial data by business segment (in millions): Wellbore Completion & Production Rig Eliminations and Total December 31, 2017 Revenue $ 2,577 $ 2,672 $ 2,252 $ (197 ) $ 7,304 Operating profit (loss) (102 ) 98 (14 ) (259 ) (277 ) Capital expenditures 99 69 16 8 192 Depreciation and amortization 379 215 88 16 698 Goodwill 2,956 2,122 1,149 — 6,227 Total assets 7,848 5,782 4,625 1,951 20,206 December 31, 2016 Revenue $ 2,199 $ 2,241 $ 3,110 $ (299 ) $ 7,251 Operating profit (770 ) (266 ) (1,033 ) (342 ) (2,411 ) Capital expenditures 124 61 24 75 284 Depreciation and amortization 384 209 94 16 703 Goodwill 2,874 2,058 1,135 — 6,067 Total assets 7,911 5,765 5,327 2,137 21,140 December 31, 2015 Revenue $ 3,718 $ 3,365 $ 8,279 $ (605 ) $ 14,757 Operating profit (1,573 ) 187 1,501 (505 ) (390 ) Capital expenditures 180 87 91 95 453 Depreciation and amortization 403 223 107 14 747 Goodwill 2,874 1,997 2,109 — 6,980 Total assets 8,766 5,916 9,227 2,061 25,970 (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 and corporate costs include intercompany transactions conducted between the three reporting segments that are eliminated in consolidation, as well as corporate costs not allocated to the segments. Intercompany transactions within each reporting segment are eliminated within each reporting segment. Also included in the eliminations and corporate costs column are capital expenditures and total assets related to corporate. Corporate assets consist primarily of cash and fixed assets. |
Quarterly Financial Data (Una41
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Results | Summarized quarterly results, were as follows (in millions, except per share data): First Second Third Fourth Quarter Quarter Quarter Quarter Year ended December 31, 2017 Revenue $ 1,741 $ 1,759 $ 1,835 $ 1,969 Gross profit 209 231 285 167 Net loss attributable to Company (122 ) (75 ) (26 ) (14 ) Net loss attributable to Company per basic share (0.32 ) (0.20 ) (0.07 ) (0.04 ) Net loss attributable to Company per diluted share (0.32 ) (0.20 ) (0.07 ) (0.04 ) Cash dividends per share 0.05 0.05 0.05 0.05 Year ended December 31, 2016 Revenue $ 2,189 $ 1,724 $ 1,646 $ 1,692 Gross profit (loss) 244 35 79 (459 ) Net loss attributable to Company (119 ) (217 ) (1,362 ) (714 ) Net loss attributable to Company per basic share (0.32 ) (0.58 ) (3.62 ) (1.90 ) Net loss attributable to Company per diluted share (0.32 ) (0.58 ) (3.62 ) (1.90 ) Cash dividends per share 0.46 0.05 0.05 0.05 |
Summary of Significant Accoun42
Summary of Significant Accounting Policies - Additional Information (Detail) shares in Millions | 3 Months Ended | 12 Months Ended | |||||
Sep. 30, 2017USD ($) | Dec. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2017USD ($)Reporting_Unitshares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Mar. 31, 2018USD ($) | |
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 | ||||||
Additional inventory reserve charges | $ 114,000,000 | $ 606,000,000 | |||||
Inventory reserves total | $ 800,000,000 | $ 1,017,000,000 | |||||
Percentage of inventory reserve | 21.00% | 23.40% | |||||
Depreciation expense related to property, plant and equipment | $ 359,000,000 | $ 370,000,000 | $ 391,000,000 | ||||
Accumulated depreciation | 2,559,000,000 | 2,298,000,000 | |||||
Accumulated depreciation for capital leases | 18,000,000 | ||||||
Impairment of long-lived assets | 10,000,000 | 54,000,000 | 0 | ||||
Goodwill | $ 6,980,000,000 | 6,227,000,000 | 6,067,000,000 | 6,980,000,000 | |||
Indefinite-lived intangible assets | $ 3,301,000,000 | 3,530,000,000 | |||||
Estimated useful lives of intangible assets, minimum | 2 years | ||||||
Estimated useful lives of intangible assets, maximum | 30 years | ||||||
Amortization expense | $ 320,000,000 | ||||||
Number of years as first period of amortization | 5 years | ||||||
Impairment of goodwill | 972,000,000 | ||||||
Net foreign currency transaction gains (losses) | $ (3,000,000) | (10,000,000) | $ (47,000,000) | ||||
Net investment in Venezuela | 0 | ||||||
Devaluation charges | $ 7,000,000 | $ 9,000,000 | |||||
Net allowances for doubtful accounts | $ 187,000,000 | $ 209,000,000 | |||||
Anti-dilutive stock options outstanding | shares | 12 | 14 | 13 | ||||
Scenario, Forecast [Member] | Maximum [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Cumulative impact on retained earnings | $ 50,000,000 | ||||||
ASU 2016-09 [Member] | Retained Earnings (Loss) [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Cumulative impact on retained earnings | $ 1,000,000 | ||||||
ASU 2016-16 [Member] | New Accounting Pronouncement, Early Adoption, Effect [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Reduction in retained earnings and receivables | 5,000,000 | ||||||
Indefinite-lived Trade Names [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Indefinite-lived intangible assets | $ 384,000,000 | ||||||
Rig Systems [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Number of reporting units has impairment loss | Reporting_Unit | 2 | ||||||
Rig Offshore [Member] | |||||||
Indefinite-lived Intangible Assets [Line Items] | |||||||
Impairment of goodwill | $ 972,000,000 |
Summary of Significant Accoun43
Summary of Significant Accounting Policies - Goodwill Identified by Segment (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | $ 6,067 | $ 6,980 |
Goodwill acquired and adjusted during period | 89 | 74 |
Impairment | (972) | |
Currency translation adjustments | 71 | (15) |
Goodwill, Ending Balance | 6,227 | 6,067 |
Wellbore Technologies [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 2,874 | 2,874 |
Goodwill acquired and adjusted during period | 37 | 4 |
Currency translation adjustments | 45 | (4) |
Goodwill, Ending Balance | 2,956 | 2,874 |
Completion & Production Solutions [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 2,058 | 1,997 |
Goodwill acquired and adjusted during period | 41 | 70 |
Currency translation adjustments | 23 | (9) |
Goodwill, Ending Balance | 2,122 | 2,058 |
Rig Technologies [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 1,135 | 2,109 |
Goodwill acquired and adjusted during period | 11 | |
Impairment | (972) | |
Currency translation adjustments | 3 | (2) |
Goodwill, Ending Balance | $ 1,149 | $ 1,135 |
Summary of Significant Accoun44
Summary of Significant Accounting Policies - Goodwill Identified by Segment (Parenthetical) (Detail) $ in Millions | Dec. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Accumulated goodwill impairment | $ 2,457 |
Summary of Significant Accoun45
Summary of Significant Accounting Policies - Identified Intangible Assets Identified by Segment (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | $ 3,530 | $ 3,849 |
Additions to intangible assets | 61 | 24 |
Amortization | (339) | (333) |
Currency translation adjustments | 49 | (10) |
Ending Balance | 3,301 | 3,530 |
Wellbore Technologies [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 2,064 | 2,254 |
Additions to intangible assets | 18 | 15 |
Amortization | (208) | (205) |
Currency translation adjustments | 9 | |
Ending Balance | 1,883 | 2,064 |
Completion & Production Solutions [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 1,191 | 1,296 |
Additions to intangible assets | 41 | 9 |
Amortization | (108) | (106) |
Currency translation adjustments | 36 | (8) |
Ending Balance | 1,160 | 1,191 |
Rig Technologies [Member] | ||
Intangible Asset Excluding Goodwill [Line Items] | ||
Beginning Balance | 275 | 299 |
Additions to intangible assets | 2 | |
Amortization | (23) | (22) |
Currency translation adjustments | 4 | (2) |
Ending Balance | $ 258 | $ 275 |
Summary of Significant Accoun46
Summary of Significant Accounting Policies - Identified Intangible Assets by Major Classification (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | $ 6,444 | $ 6,334 | |
Accumulated Amortization | (3,143) | (2,804) | |
Net Book Value | 3,301 | 3,530 | $ 3,849 |
Indefinite-lived Trade Names [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 384 | 384 | |
Net Book Value | 384 | 384 | |
Customer Relationships [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 4,074 | 4,024 | |
Accumulated Amortization | (2,118) | (1,874) | |
Net Book Value | 1,956 | 2,150 | |
Trademarks [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 885 | 878 | |
Accumulated Amortization | (317) | (290) | |
Net Book Value | 568 | 588 | |
Other [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 499 | 463 | |
Accumulated Amortization | (324) | (295) | |
Net Book Value | 175 | 168 | |
Patents [Member] | |||
Intangible Assets Net Excluding Goodwill [Line Items] | |||
Gross | 602 | 585 | |
Accumulated Amortization | (384) | (345) | |
Net Book Value | $ 218 | $ 240 |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Changes in Carrying Amount of Service and Product Warranties (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Product Warranties Disclosures [Abstract] | ||
Beginning Balance | $ 172 | $ 244 |
Net provisions for warranties issued during the year | 46 | 50 |
Amounts incurred | (86) | (127) |
Currency translation adjustments and other | 3 | 5 |
Ending Balance | $ 135 | $ 172 |
Summary of Significant Accoun48
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, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Numerator: | |||||||||||
Net loss attributable to Company | $ (14) | $ (26) | $ (75) | $ (122) | $ (714) | $ (1,362) | $ (217) | $ (119) | $ (237) | $ (2,412) | $ (769) |
Denominator: | |||||||||||
Basic-weighted average common shares outstanding | 377 | 376 | 387 | ||||||||
Dilutive effect of employee stock options and other unvested stock awards | 0 | 0 | 0 | ||||||||
Diluted outstanding shares | 377 | 376 | 387 | ||||||||
Basic loss attributable to Company per share | $ (0.04) | $ (0.07) | $ (0.20) | $ (0.32) | $ (1.90) | $ (3.62) | $ (0.58) | $ (0.32) | $ (0.63) | $ (6.41) | $ (1.99) |
Diluted loss attributable to Company per share | (0.04) | (0.07) | (0.20) | (0.32) | (1.90) | (3.62) | (0.58) | (0.32) | (0.63) | (6.41) | (1.99) |
Cash dividends per share | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.46 | $ 0.20 | $ 0.61 | $ 1.84 |
Derivative Financial Instrume49
Derivative Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 33 | $ 62 |
Derivative Liabilities | 11 | $ 77 |
Fair value of the Company's foreign currency forward contracts | 22 | |
Fair Value, Inputs, Level 2 [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 33 | |
Derivative Liabilities | $ 11 |
Derivative Financial Instrume50
Derivative Financial Instruments - Outstanding Foreign Currency Forward Contracts (Detail) - Forward Contracts [Member] € in Millions, ¥ in Millions, £ in Millions, ZAR in Millions, SGD in Millions, RUB in Millions, NOK in Millions, DKK in Millions, CAD in Millions, $ in Millions | Dec. 31, 2017USD ($) | Dec. 31, 2017JPY (¥) | Dec. 31, 2017NOK | Dec. 31, 2017DKK | Dec. 31, 2017EUR (€) | Dec. 31, 2017GBP (£) | Dec. 31, 2017RUB | Dec. 31, 2017ZAR | Dec. 31, 2016USD ($) | Dec. 31, 2016JPY (¥) | Dec. 31, 2016NOK | Dec. 31, 2016SGD | Dec. 31, 2016DKK | Dec. 31, 2016EUR (€) | Dec. 31, 2016GBP (£) | Dec. 31, 2016RUB | Dec. 31, 2016ZAR | Dec. 31, 2016CAD |
Derivative [Line Items] | ||||||||||||||||||
Foreign currency, Cash flow hedging | $ 163 | ¥ 982 | NOK 4,013 | DKK 30 | € 120 | £ 11 | $ 321 | ¥ 1,462 | NOK 5,621 | SGD 2 | DKK 29 | € 279 | £ 1 | |||||
Foreign currency, Non-designated hedging | $ 463 | NOK 1,734 | DKK 15 | € 99 | £ 3 | RUB 2,699 | ZAR 150 | $ 457 | NOK 538 | SGD 7 | DKK 49 | € 272 | £ 3 | RUB 1,893 | ZAR 150 | CAD 1 |
Derivative Financial Instrume51
Derivative Financial Instruments - Derivative Instruments and their Balance Sheet Classifications (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 33 | $ 62 |
Derivative Liabilities | 11 | 77 |
Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 21 | 30 |
Derivative Liabilities | 5 | 48 |
Not Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 12 | 32 |
Derivative Liabilities | 6 | 29 |
Foreign Exchange Contracts [Member] | Prepaid and Other Current Assets [Member] | Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 13 | 24 |
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 | 3 | 37 |
Foreign Exchange Contracts [Member] | Prepaid and Other Current Assets [Member] | Not Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 10 | 32 |
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 | 5 | 29 |
Foreign Exchange Contracts [Member] | Other Liabilities [Member] | Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 2 | 11 |
Foreign Exchange Contracts [Member] | Other Liabilities [Member] | Not Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 1 | |
Foreign Exchange Contracts [Member] | Other Assets [Member] | Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 8 | $ 6 |
Foreign Exchange Contracts [Member] | Other Assets [Member] | Not Designated as Hedging Instruments [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 2 |
Derivative Financial Instrume52
Derivative Financial Instruments - Effect of Derivative Instruments on Consolidated Statements of Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | $ 2 | $ 8 |
Not Designated as Hedging Instruments [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivatives | 58 | (33) |
Cash Flow Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | 56 | 45 |
Foreign Exchange Contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | (11) | (165) |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | 9 | (13) |
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) | 56 | 45 |
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) | 2 | 8 |
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 | 58 | (33) |
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) | (19) | (170) |
Amount of Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) | 7 | (21) |
Foreign Exchange Contracts [Member] | Revenue [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | $ 8 | $ 5 |
Derivative Financial Instrume53
Derivative Financial Instruments - Effect of Derivative Instruments on Consolidated Statements of Income (Loss) (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), reclassified | $ (5) | $ (134) | $ (199) | |
Amount of gain (loss) recognized in income on derivative (ineffective portion) | 7 | (21) | ||
Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) | $ 2 | $ 8 | ||
Scenario, Forecast [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), reclassified | $ 5 |
Acquisitions and Investments -
Acquisitions and Investments - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($)Acquisition | Dec. 31, 2016USD ($)Acquisition | Dec. 31, 2015USD ($)Acquisition | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Aggregate cash investment of acquisitions | $ 86 | $ 230 | $ 86 |
Goodwill | $ 6,227 | $ 6,067 | $ 6,980 |
All Other Acquisitions [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Acquisitions completed | Acquisition | 8 | 10 | 7 |
Aggregate cash investment of acquisitions | $ 86 | $ 230 | $ 86 |
Intangible assets | 61 | 24 | 13 |
Goodwill | $ 89 | 74 | $ 51 |
Business acquisition Nov stock issued | $ 18 |
Acquisitions and Investments 55
Acquisitions and Investments - Summary of Acquisitions (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Business Combinations [Abstract] | |||
Fair value of assets acquired, net of cash acquired | $ 154 | $ 357 | $ 116 |
Cash paid, net of cash acquired | (86) | (230) | (86) |
Liabilities assumed, debt issued and noncontrolling interest | 68 | 127 | 30 |
Excess purchase price over fair value of net assets acquired | $ 89 | $ 74 | $ 51 |
Inventories, net - Inventories
Inventories, net - Inventories (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 656 | $ 961 |
Work in process | 513 | 561 |
Finished goods and purchased products | 1,834 | 1,803 |
Total | $ 3,003 | $ 3,325 |
Property, Plant and Equipment -
Property, Plant and Equipment - Property, Plant and Equipment (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 5,561 | $ 5,448 |
Less: Accumulated Depreciation | (2,559) | (2,298) |
Property, plant and equipment, net | 3,002 | 3,150 |
Land and Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 1,592 | 1,570 |
Estimated Useful Lives | 5-35 Years | |
Operating Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 3,169 | 3,102 |
Estimated Useful Lives | 3-15 Years | |
Rental Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 581 | 557 |
Estimated Useful Lives | 3-12 Years | |
Capital Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment Gross | $ 219 | $ 219 |
Estimated Useful Lives | 20-24 Years |
Accrued Liabilities - Accrued L
Accrued Liabilities - Accrued Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | |||
Vendor costs | $ 150 | $ 235 | |
Customer prepayments and billings | 240 | 222 | |
Compensation | 345 | 181 | |
Taxes (non income) | 152 | 176 | |
Warranty | 135 | 172 | $ 244 |
Insurance | 74 | 103 | |
Fair value of derivatives | 8 | 66 | |
Commissions | 58 | 57 | |
Interest | 7 | 8 | |
Other | 309 | 348 | |
Total | $ 1,478 | $ 1,568 |
Costs and Estimated Earnings 59
Costs and Estimated Earnings on Uncompleted Contracts - Costs and Estimated Earnings on Uncompleted Contracts (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Contractors [Abstract] | ||
Costs incurred on uncompleted contracts | $ 6,395 | $ 8,132 |
Estimated earnings | 3,023 | 3,869 |
Costs and estimated earnings on uncompleted contracts, Gross | 9,418 | 12,001 |
Less: Billings to date on uncompleted contracts | 9,202 | 11,776 |
Total net estimate billing on uncompleted contracts | 216 | 225 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 495 | 665 |
Billings in excess of costs and estimated earnings on uncompleted contracts | (279) | (440) |
Total net estimate billing on uncompleted contracts | $ 216 | $ 225 |
Debt - Debt (Detail)
Debt - Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Capital Leases and other debt | $ 232 | $ 237 |
Total debt | 2,712 | 3,214 |
Total debt | 2,712 | 3,214 |
Less current portion | 6 | 506 |
Long-term debt | 2,706 | 2,708 |
Senior Notes, Interest at 1.35% Payable Semiannually, Principal Due on December 1, 2017 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | 499 | |
Senior Notes, Interest at 2.60% Payable Semiannually, Principal Due on December 1, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | 1,392 | 1,391 |
Senior Notes, Interest at 3.95% Payable Semiannually, Principal Due on December 1, 2042 [Member] | ||
Debt Instrument [Line Items] | ||
Senior Notes | $ 1,088 | $ 1,087 |
Debt - Debt (Parenthetical) (De
Debt - Debt (Parenthetical) (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Nov. 29, 2017 | |
Senior Notes, Interest at 1.35% Payable Semiannually, Principal Due on December 1, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Senior note face amount | $ 500,000,000 | $ 500,000,000 | |
Senior notes interest rate | 1.35% | 1.35% | 1.35% |
Senior note due date | Dec. 1, 2017 | Dec. 1, 2017 | |
Senior Notes, Interest at 2.60% Payable Semiannually, Principal Due on December 1, 2022 [Member] | |||
Debt Instrument [Line Items] | |||
Senior note face amount | $ 1,400,000,000 | $ 1,400,000,000 | |
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 note face amount | $ 1,100,000,000 | $ 1,100,000,000 | |
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 and Capital Leases (Detail) $ in Millions | Dec. 31, 2017USD ($) |
Debt Disclosure [Abstract] | |
2,018 | $ 6 |
2,019 | 5 |
2,020 | 5 |
2,021 | 5 |
2,022 | 1,405 |
Thereafter | 1,286 |
Total debt | $ 2,712 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | Nov. 29, 2017 | Jun. 27, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||||
Interest rate under multi currency facility | LIBOR, NIBOR or CDOR plus 1.125% | |||
Capitalization ratio, Maximum | 60.00% | |||
Capitalization ratio, Actual | 16.10% | |||
Funds available under revolving credit facility | $ 3,000,000,000 | |||
Outstanding letters of credit under various bilateral letter of credit facilities | 658,000,000 | |||
Fair value of Unsecured Senior Notes | 2,346,000,000 | $ 2,669,000,000 | ||
Carrying value of Unsecured Senior Notes | $ 2,712,000,000 | $ 3,214,000,000 | ||
Senior Notes, Interest at 1.35% Payable Semiannually, Principal Due on December 1, 2017 [Member] | ||||
Debt Instrument [Line Items] | ||||
Repayment of debt | $ 500,000,000 | |||
Senior notes interest rate | 1.35% | 1.35% | 1.35% | |
Canadian Dollar Offered Rate (CDOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Variable rate | 1.125% | |||
Five-year Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility, borrowing capacity | $ 3,000,000,000 | $ 3,000,000,000 | ||
Credit facility, Period | 5 years | |||
Credit facility, maturity date | Jun. 27, 2022 | |||
Credit facility, extendable borrowing capacity | $ 4,000,000,000 | |||
Variable rate basis | LIBOR, NIBOR or CDOR plus | |||
Borrowings under commercial paper | $ 0 | |||
Unsecured Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility, Period | 5 years | |||
Previous Five Year Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility, borrowing capacity | $ 4,500,000,000 | |||
Unsecured Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Carrying value of Unsecured Senior Notes | $ 2,480,000,000 | $ 2,977,000,000 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($)Employees | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Compensation Related Costs Disclosure [Line Items] | |||
Expenses for defined-contribution plans | $ 64 | $ 66 | $ 95 |
Net periodic benefit cost | 1 | $ 5 | $ 5 |
Defined benefit plan, expected future benefit payments in year five | $ 33 | ||
Expected years of defined benefit plans | 5 years | ||
Expected future benefit amounts to pay, total | $ 324 | ||
United States [Member] | |||
Compensation Related Costs Disclosure [Line Items] | |||
Number of U.S retirees and spouses participate in defined benefit health care plans | Employees | 1,950 | ||
Number of U.S. employees participate in defined benefit health care plans | Employees | 40 |
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, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets at beginning of year | $ 543 | |
Fair value of plan assets at end of year | 588 | $ 543 |
Pension Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Benefit obligation at beginning of year | 622 | 703 |
Service cost | 1 | 5 |
Interest cost | 20 | 25 |
Actuarial loss (gain) | 6 | 42 |
Benefits paid | (31) | (30) |
Exchange rate loss (gain) | 30 | (37) |
Acquisitions (disposals) | 2 | |
Curtailments | (17) | |
Settlements | (15) | (71) |
Other | 1 | |
Benefit obligation at end of year | 633 | 622 |
Fair value of plan assets at beginning of year | 543 | 601 |
Actual return | 57 | 60 |
Benefits paid | (31) | (30) |
Company contributions | 11 | 16 |
Exchange rate gain (loss) | 24 | (34) |
Settlements | (15) | (71) |
Acquisitions (disposals) | 1 | |
Other | (1) | |
Fair value of plan assets at end of year | 588 | 543 |
Funded status | (45) | (79) |
Accumulated benefit obligation at end of year | 630 | 617 |
Postretirement Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Benefit obligation at beginning of year | 92 | 90 |
Interest cost | 3 | 3 |
Actuarial loss (gain) | (17) | (29) |
Benefits paid | (14) | (16) |
Participants contributions | 2 | 2 |
Curtailments | (4) | |
Other | 42 | |
Benefit obligation at end of year | 62 | 92 |
Benefits paid | (14) | (16) |
Company contributions | 12 | 14 |
Participants contributions | 2 | 2 |
Other | (42) | |
Funded status | $ (62) | $ (92) |
Employee Benefit Plans - Assump
Employee Benefit Plans - Assumption Rates Used for Benefit Obligations (Detail) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Domestic Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate minimum | 3.00% | 3.10% |
Discount rate maximum | 3.60% | 4.00% |
Foreign Plan [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate minimum | 1.80% | 1.80% |
Discount rate maximum | 2.40% | 2.80% |
Salary increase minimum | 1.80% | 1.80% |
Salary increase maximum | 3.30% | 3.50% |
Employee Benefit Plans - Assu67
Employee Benefit Plans - Assumption Rates Used for Net Periodic Benefit Costs (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Domestic Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate minimum | 3.10% | 3.20% | 3.70% |
Discount rate maximum | 4.00% | 4.20% | 4.20% |
Expected return on assets | 5.60% | 5.60% | 5.50% |
Foreign Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate minimum | 1.80% | 2.20% | 2.20% |
Discount rate maximum | 2.80% | 3.70% | 3.70% |
Salary increase minimum | 1.80% | 2.00% | 2.00% |
Salary increase maximum | 3.50% | 4.20% | 4.20% |
Expected return on assets, minimum | 1.80% | 1.80% | 2.30% |
Expected return on assets, maximum | 3.00% | 3.00% | 5.12% |
Employee Benefit Plans - Plan's
Employee Benefit Plans - Plan's Assets Carried at Fair Value (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | $ 588 | $ 543 | |
Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 161 | 181 | |
Bonds [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 284 | 262 | |
Other Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 143 | 100 | |
Fair Value, Inputs, Level 2 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 527 | 490 | |
Fair Value, Inputs, Level 2 [Member] | Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 161 | 181 | |
Fair Value, Inputs, Level 2 [Member] | Bonds [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 284 | 262 | |
Fair Value, Inputs, Level 2 [Member] | Other Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 82 | 47 | |
Fair Value, Inputs, Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | 61 | 53 | $ 99 |
Fair Value, Inputs, Level 3 [Member] | Other Contract [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total Fair Value Measurements | $ 61 | $ 53 |
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, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets at beginning of year | $ 543 | |
Fair value of plan assets at end of year | 588 | $ 543 |
Fair Value, Inputs, Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets at beginning of year | 53 | 99 |
Actual return on plan assets still held at reporting date | 2 | 5 |
Purchases, sales and settlements | (1) | (50) |
Currency translation adjustments | 7 | (1) |
Fair value of plan assets at end of year | $ 61 | $ 53 |
Accumulated Other Comprehensi70
Accumulated Other Comprehensive Income (Loss) - Components of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | $ (1,452) | $ (1,553) | $ (834) |
Accumulated other comprehensive income (loss) before reclassifications | 338 | (30) | (914) |
Amounts reclassified from accumulated other comprehensive income (loss) | 4 | 131 | 195 |
Accumulated other comprehensive income (loss), Ending balance | (1,110) | (1,452) | (1,553) |
Currency Translation Adjustments [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | (1,376) | (1,279) | (515) |
Accumulated other comprehensive income (loss) before reclassifications | 272 | (97) | (764) |
Accumulated other comprehensive income (loss), Ending balance | (1,104) | (1,376) | (1,279) |
Derivative Financial Instruments, Net of Tax [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | (39) | (205) | (228) |
Accumulated other comprehensive income (loss) before reclassifications | 41 | 32 | (176) |
Amounts reclassified from accumulated other comprehensive income (loss) | 5 | 134 | 199 |
Accumulated other comprehensive income (loss), Ending balance | 7 | (39) | (205) |
Defined Benefit Plans, Net of Tax [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Accumulated other comprehensive income (loss), Beginning balance | (37) | (69) | (91) |
Accumulated other comprehensive income (loss) before reclassifications | 25 | 35 | 26 |
Amounts reclassified from accumulated other comprehensive income (loss) | (1) | (3) | (4) |
Accumulated other comprehensive income (loss), Ending balance | $ (13) | $ (37) | $ (69) |
Accumulated Other Comprehensi71
Accumulated Other Comprehensive Income (Loss) - Components of Amounts Reclassified from Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | $ 0 | $ 0 | $ 0 |
Derivative Financial Instruments | 5 | 134 | 199 |
Defined Benefit Plans | (1) | (3) | (4) |
Total | 4 | 131 | 195 |
Revenue [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | 0 | 0 | 0 |
Derivative Financial Instruments | (8) | (5) | (19) |
Total | (8) | (5) | (19) |
Cost of Revenue [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | 0 | 0 | 0 |
Derivative Financial Instruments | 12 | 191 | 295 |
Total | 12 | 191 | 295 |
Selling, General, and Administrative [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | 0 | 0 | 0 |
Defined Benefit Plans | (1) | (5) | (6) |
Total | (1) | (5) | (6) |
Tax Effect [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | 0 | 0 | 0 |
Derivative Financial Instruments | 1 | (52) | (77) |
Defined Benefit Plans | 2 | 2 | |
Total | $ 1 | $ (50) | $ (75) |
Accumulated Other Comprehensi72
Accumulated Other Comprehensive Income (Loss) - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net increase to other comprehensive income or loss upon the translation | $ 272 | $ (97) | $ (764) |
Changes in derivative financial instruments, net of tax | 46 | 166 | 23 |
Changes in derivative financial instruments, tax | $ 13 | $ 65 | $ 14 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2016 | |
Commitment And Contingencies [Line Items] | ||||
Rental expense related to operating leases | $ 209 | $ 246 | $ 327 | |
Brazil [Member] | ||||
Commitment And Contingencies [Line Items] | ||||
Removed orders from backlog | $ 2,100 |
Commitments and Contingencies74
Commitments and Contingencies - Future Minimum Lease Commitments Under Capital Leases and Noncancellable Operating Leases with Initial or Remaining Terms of One Year or More (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Commitments and Contingencies Disclosure [Abstract] | ||
Capital Lease Payments, 2018 | $ 15 | |
Capital Lease Payments, 2019 | 15 | |
Capital Lease Payments, 2020 | 15 | |
Capital Lease Payments, 2021 | 15 | |
Capital Lease Payments, 2022 | 15 | |
Capital Lease Payments, Thereafter | 273 | |
Total Capital Lease Payments | $ 348 | |
Operating Lease Payments, 2018 | $ 130 | |
Operating Lease Payments, 2019 | 98 | |
Operating Lease Payments, 2020 | 82 | |
Operating Lease Payments, 2021 | 67 | |
Operating Lease Payments, 2022 | 55 | |
Operating Lease Payments, Thereafter | 339 | |
Total Operating Lease Payments | $ 771 |
Common Stock - Additional Infor
Common Stock - Additional Information (Detail) | Dec. 20, 2017USD ($)$ / sharesshares | May 17, 2017$ / sharesshares | Feb. 22, 2017$ / sharesshares | Jun. 30, 2016shares | Dec. 31, 2017USD ($)Installment$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of common stock, authorized | shares | 1,000,000,000 | 1,000,000,000 | |||||
Number of preferred stock, authorized | shares | 10,000,000 | ||||||
Common stock, par value | $ / shares | $ 0.01 | $ 0.01 | |||||
Preferred stock, par value | $ / shares | $ 0.01 | ||||||
Preferred stock, shares issued | shares | 0 | ||||||
Preferred stock, shares outstanding | shares | 0 | ||||||
Aggregated cash dividends paid | $ 76,000,000 | $ 230,000,000 | $ 710,000,000 | ||||
Stock-based compensation expense | 124,000,000 | 107,000,000 | 109,000,000 | ||||
Income tax provision recognized | $ 24,000,000 | $ 30,000,000 | $ 32,000,000 | ||||
Earlier authorized shares under stock based compensation | shares | 69,400,000 | ||||||
Remaining shares available for future grants under the Plan | shares | 17,800,000 | ||||||
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. | ||||||
Stock option, Minimum Range | $ / shares | $ 23.94 | ||||||
Stock option, Maximum Range | $ / shares | 77.99 | ||||||
Weighted average grant-date fair value of options | $ / shares | $ 9.68 | $ 6.44 | $ 15.41 | ||||
Total intrinsic value of options exercised | $ 13,000,000 | $ 4,000,000 | |||||
Total unrecognized compensation cost related to nonvested stock options | $ 36,000,000 | ||||||
Compensation cost not yet recognized, period for recognition | 2 years | ||||||
Total fair value of stock options vested | $ 70,000,000 | 61,000,000 | $ 72,000,000 | ||||
Cash received from option exercises | 13,000,000 | 4,000,000 | 7,000,000 | ||||
Tax benefit (expense) realized for the tax deductions from option exercises | $ (2,000,000) | $ 0 | 3,000,000 | ||||
Cash payment of stock appreciation rights | $ 2,221,000,000 | ||||||
Weighted average exercise price per share of options | $ / shares | $ 36.51 | $ 28.26 | $ 54.74 | ||||
Shares granted | shares | 1,738,589 | 3,384,325 | 954,075 | ||||
Restricted stock granted fair value | $ / shares | $ 38.74 | $ 31.59 | $ 53.27 | ||||
Total number of restricted stock awards and restricted stock units vested | shares | 1,018,206 | 565,202 | 405,327 | ||||
Stock Appreciation Rights (SARs) [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 11,000,000 | ||||||
Total unrecognized compensation cost related to nonvested stock options | $ 16,000,000 | ||||||
Compensation cost not yet recognized, period for recognition | 2 years | ||||||
Stock appreciation rights exchange percentage | 94.75% | ||||||
Cash payment of stock appreciation rights | $ 14,000,000 | ||||||
Increase additional paid-in capital | $ 20,000,000 | ||||||
Cash paid to settle SARs | 2,000,000 | ||||||
Compensation cost recognized | $ 8,000,000 | $ 20,000,000 | |||||
Shares granted | shares | 14,400 | 4,618,400 | |||||
Restricted stock granted fair value | $ / shares | $ 38.86 | $ 28.32 | |||||
Restricted Stock and Restricted Stock Units [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Duration of performance-based restricted stock awards, vested | The restricted stock and restricted stock units vest on the third anniversary of the date of grant or in three equal annual installments commencing on the first anniversary of the date of grant. | ||||||
Shares granted | shares | 1,504,450 | ||||||
Restricted stock granted fair value | $ / shares | $ 38.86 | ||||||
Number of equal annual vesting installments | Installment | 3 | ||||||
Performance-base restricted stock [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Description of performance goal | The performance share awards can be earned based on performance against established goals over a three-year performance period. | ||||||
TSR Award [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Description of performance goal | The performance share awards are based entirely on a TSR (total shareholder return) goal. 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. | ||||||
Restricted Stock Awards [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Total unrecognized compensation cost related to nonvested stock options | $ 99,000,000 | ||||||
Compensation cost not yet recognized, period for recognition | 2 years | ||||||
Shares granted | shares | 36,701 | ||||||
Restricted stock granted fair value | $ / shares | $ 33.38 | $ 38.74 | $ 31.59 | $ 53.27 | |||
Total number of restricted stock awards and restricted stock units vested | shares | 1,018,206 | 565,202 | 405,327 | ||||
Stock Options [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Weighted average grant-date fair value of options | $ / shares | $ 8.47 | ||||||
Stock options granted | shares | 3,613,707 | ||||||
Weighted average exercise price per share of options | $ / shares | $ 34.32 | ||||||
Minimum [Member] | Performance-base restricted stock [Member] | Senior Management Employees [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | shares | 0 | ||||||
Maximum [Member] | Performance-base restricted stock [Member] | Senior Management Employees [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | shares | 388,380 |
Common Stock - Summary of Stock
Common Stock - Summary of Stock Options (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Number of shares under stock option, Beginning of the year | 17,439,060 | 15,430,307 | 10,881,133 |
Number of Shares Granted | 6,961,041 | 3,672,411 | 5,746,153 |
Number of Shares Forfeited | (1,482,531) | (1,517,065) | (886,356) |
Number of Shares Exercised | (445,523) | (146,593) | (310,623) |
Number of shares under stock option, End of the year | 22,472,047 | 17,439,060 | 15,430,307 |
Number of stock options vested and expected to be vest, exercisable | 14,309,944 | 9,828,897 | 7,498,414 |
Weighted Average Exercise Price, Beginning of year | $ 54.08 | $ 59.50 | $ 61.22 |
Weighted Average Exercise Price, Stock Options Granted | 36.51 | 28.26 | 54.74 |
Weighted Average Exercise Price, Stock Options Forfeited | 55.22 | 49.95 | 62.73 |
Weighted Average Exercise Price, Stock Options Exercised | 29.83 | 28.53 | 22.56 |
Weighted Average Exercise Price, End of the year | 48.99 | 54.08 | 59.50 |
Weighted Average Exercise Price, Stock Options Exercisable | $ 55 | $ 61.56 | $ 60.30 |
Common Stock - Summary of Sto77
Common Stock - Summary of Stock Option Outstanding Information (Detail) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Weighted-Avg Remaining Contractual Life | 6 years 7 months 28 days |
Stock Options Outstanding, Shares | shares | 22,472,047 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 48.99 |
Stock Options Exercisable, Shares | shares | 14,309,944 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 55 |
Stock option, Minimum Range | 23.94 |
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 6 months 18 days |
Stock Options Outstanding, Shares | shares | 15,797,683 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 40.25 |
Stock Options Exercisable, Shares | shares | 7,635,580 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 42.19 |
Stock option, Minimum Range | 23.94 |
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 | 5 years 1 month 2 days |
Stock Options Outstanding, Shares | shares | 4,301,953 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 66.20 |
Stock Options Exercisable, Shares | shares | 4,301,953 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 66.20 |
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 | 3 years 7 months 2 days |
Stock Options Outstanding, Shares | shares | 2,372,411 |
Stock Options Outstanding, Weighted - Average Exercise Price | $ 75.94 |
Stock Options Exercisable, Shares | shares | 2,372,411 |
Stock Options Exercisable, Weighted - Average Exercise Price | $ 75.94 |
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) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Expected volatility | 36.10% | 48.60% | 49.10% |
Risk-free interest rate | 2.20% | 1.20% | 1.50% |
Expected dividend yield | 0.60% | 6.50% | 3.40% |
Expected term (in years) | 3 years | 3 years | 3 years |
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Number of shares under stock option, Beginning of the year | 17,439,060 | 15,430,307 | 10,881,133 |
Number of Shares Granted | 6,961,041 | 3,672,411 | 5,746,153 |
Number of Shares Forfeited | (1,482,531) | (1,517,065) | (886,356) |
Number of Shares Exercised | (445,523) | (146,593) | (310,623) |
Number of shares under stock option, End of the year | 22,472,047 | 17,439,060 | 15,430,307 |
Number of stock options, Exercisable | 14,309,944 | 9,828,897 | 7,498,414 |
Weighted Average Exercise Price, Beginning of year | $ 54.08 | $ 59.50 | $ 61.22 |
Weighted Average Exercise Price, Stock Options Granted | 36.51 | 28.26 | 54.74 |
Weighted Average Exercise Price, Stock Options Forfeited | 55.22 | 49.95 | 62.73 |
Weighted Average Exercise Price, Stock Options Exercised | 29.83 | 28.53 | 22.56 |
Weighted Average Exercise Price, End of the year | 48.99 | 54.08 | 59.50 |
Weighted Average Exercise Price, Stock Options, Exercisable | $ 55 | $ 61.56 | $ 60.30 |
Weighted Average Remaining Contractual Term, Outstanding | 6 years 7 months 28 days | 5 years 5 months 1 day | |
Weighted Average Remaining Contractual Term, Exercisable | 5 years 8 months 12 days | ||
Stock Options Aggregate Intrinsic Value, Beginning | $ 6,700,856 | ||
Stock Options Aggregate Intrinsic Value, Granted | $ 0 | ||
Stock Options Aggregate Intrinsic Value, Ending | $ 34,186,368 | $ 6,700,856 | |
Stock Options Average Aggregate Intrinsic Value, Exercisable | $ 15,557,324 |
Common Stock - Summary of Inf80
Common Stock - Summary of Information Regarding Outstanding SARs (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-Average Grant Date Fair Value of Restricted Stock, Beginning Balance | $ 41.10 | $ 61.53 | $ 73.73 |
Granted | 38.74 | 31.59 | 53.27 |
Forfeited | 55.22 | 49.95 | 62.73 |
Weighted-Average Grant Date Fair Value of Restricted Stock, Ending Balance | $ 37.04 | $ 41.10 | $ 61.53 |
Restricted Shares Outstanding, Beginning balance | 4,563,983 | 1,969,250 | 1,569,141 |
Granted | 1,738,589 | 3,384,325 | 954,075 |
Forfeited | (394,688) | (224,390) | (148,639) |
Restricted Shares Outstanding, Ending balance | 4,889,678 | 4,563,983 | 1,969,250 |
Stock Appreciation Rights (SARs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-Average Grant Date Fair Value of Restricted Stock, Beginning Balance | $ 28.32 | ||
Granted | 38.86 | $ 28.32 | |
Forfeited | 28.35 | 28.24 | |
Exercised | 34.72 | ||
Weighted-Average Grant Date Fair Value of Restricted Stock, Ending Balance | 28.41 | $ 28.32 | |
Average Exercise Price, Exercisable at end of year | $ 28.33 | ||
Restricted Shares Outstanding, Beginning balance | 4,341,740 | ||
Granted | 14,400 | 4,618,400 | |
Forfeited | (283,822) | (276,660) | |
Exercised | (2,578,629) | ||
Restricted Shares Outstanding, Ending balance | 1,493,689 | 4,341,740 | |
Exercisable at end of year | 75,102 |
Common Stock - Summary of Inf81
Common Stock - Summary of Information Regarding Outstanding Restricted Shares (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Restricted Shares Outstanding, Beginning balance | 4,563,983 | 1,969,250 | 1,569,141 |
Restricted Stock Granted, Shares | 1,738,589 | 3,384,325 | 954,075 |
Restricted Stock Vested, Shares | (1,018,206) | (565,202) | (405,327) |
Restricted Stock Forfeited, Shares | (394,688) | (224,390) | (148,639) |
Restricted Shares Outstanding, Ending balance | 4,889,678 | 4,563,983 | 1,969,250 |
Weighted-Average Grant Date Fair Value of Restricted Stock, Beginning Balance | $ 41.10 | $ 61.53 | $ 73.73 |
Restricted Stock Granted, Weighted-Average Grant Date Fair Value | 38.74 | 31.59 | 53.27 |
Restricted Stock Vested, Weighted-Average Grant Date Fair Value | 34.84 | 29.32 | 54.30 |
Restricted Stock Forfeited, Weighted-Average Grant Date Fair Value | 55.22 | 49.95 | 62.73 |
Weighted-Average Grant Date Fair Value of Restricted Stock, Ending Balance | $ 37.04 | $ 41.10 | $ 61.53 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Tax Credit Carryforward [Line Items] | |||||
Federal statutory income tax rate | 35.00% | ||||
Income tax benefit related to revaluation of net deferred tax liability | $ 242 | ||||
Effective income tax rate | 39.80% | 7.90% | |||
Unrecognized tax benefit | $ 132 | $ 78 | $ 46 | $ 115 | |
Total uncertain tax position identified in foreign jurisdiction | 64 | 65 | 69 | ||
Reduction in unrecognized tax position completion of audits in foreign jurisdictions | 14 | 21 | 75 | ||
Decrease in unrecognized tax benefits is reasonably possible | 75 | ||||
Income tax interest and penalties related to unrecognized tax benefit | 17 | 10 | $ 1 | ||
Accrued income tax interest and penalties related to unrecognized tax benefit | 32 | $ 15 | |||
Foreign tax credit | 658 | ||||
Net operating loss carry forward | 816 | ||||
Tax-deductible goodwill | 153 | ||||
Undistributed earnings of foreign subsidiaries | $ 5,302 | ||||
Scenario, Forecast [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Federal statutory income tax rate | 21.00% | ||||
Maximum [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Period of amortization of goodwill | 13 years | ||||
Carry Forward Expiration Year 2020 [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Net operating loss carry forward | $ 11 | ||||
Carry Forward Expiration Year 2022 [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Net operating loss carry forward | 141 | ||||
Carry Forward Expiration Year 2026 [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Net operating loss carry forward | 287 | ||||
Carry Forward Expiration Year 2027 [Member] | |||||
Tax Credit Carryforward [Line Items] | |||||
Net operating loss carry forward | $ 219 |
Income Taxes - Domestic and For
Income Taxes - Domestic and Foreign Components of Income (Loss) Before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Income before income taxes, Domestic | $ (470) | $ (2,095) | $ (1,577) |
Income before income taxes, Foreign | 78 | (528) | 988 |
Income before income taxes | $ (392) | $ (2,623) | $ (589) |
Income Taxes - Components of Pr
Income Taxes - Components of Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Federal | $ 23 | $ (79) | $ 30 |
State | 1 | (4) | (58) |
Foreign | 161 | 74 | 464 |
Total current income tax provision | 185 | (9) | 436 |
Deferred: | |||
Federal | (332) | (132) | (41) |
State | (2) | (7) | (38) |
Foreign | (7) | (59) | (179) |
Total deferred income tax provision | (341) | (198) | (258) |
Total income tax provision | $ (156) | $ (207) | $ 178 |
Income Taxes - Difference Betwe
Income Taxes - Difference Between Effective Tax Rate (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax at U.S. statutory rate | $ (137) | $ (918) | $ (206) |
Foreign income tax rate differential | (21) | 32 | (110) |
Goodwill impairment | 271 | 462 | |
Nondeductible expenses | 38 | 30 | 66 |
Foreign dividends, net of foreign tax credits | (132) | (25) | 28 |
Tax rate change on timing differences | (245) | (8) | (45) |
Change in uncertain tax positions | 81 | 11 | 69 |
Prior years taxes | (26) | (29) | (47) |
Tax impact on foreign exchange | 5 | (4) | (46) |
Change in deferred tax valuation allowance | 280 | 476 | 15 |
Other | 1 | (43) | (8) |
Total income tax provision | $ (156) | $ (207) | $ 178 |
Income Taxes - Significant Comp
Income Taxes - Significant Components of Deferred Tax Assets and Liability (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Allowances and operating liabilities | $ 355 | $ 534 |
Net operating loss carryforwards | 182 | 153 |
Postretirement benefits | 31 | 60 |
Tax credit carryforwards | 1,002 | 405 |
Other | 78 | 164 |
Valuation allowance | (1,202) | (544) |
Total deferred tax assets | 446 | 772 |
Deferred tax liabilities: | ||
Tax over book depreciation | 174 | 267 |
Intangible assets | 716 | 1,148 |
Deferred income | 111 | 185 |
Accrued tax on unremitted earnings | 17 | 53 |
Other | 92 | 97 |
Total deferred tax liabilities | 1,110 | 1,750 |
Net deferred tax liability | $ 664 | $ 978 |
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefit at beginning of year | $ 78 | $ 46 | $ 115 |
Gross increase for current period tax positions | 10 | 3 | 8 |
Gross increase for tax positions in prior years | 64 | 65 | 75 |
Gross decrease for tax positions in prior years | (14) | (21) | (75) |
Settlements | (3) | (69) | |
Lapse of statute of limitations | (6) | (12) | (8) |
Unrecognized tax benefit at end of year | $ 132 | $ 78 | $ 46 |
Income Taxes - Summary of Net O
Income Taxes - Summary of Net Operating Loss Carryforwards (Detail) $ in Millions | Dec. 31, 2017USD ($) |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | $ 816 |
Tax Effected NOL | 182 |
Valuation Allowance (VA) | (157) |
NOL Net of VA | 25 |
2018 - 2021 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 65 |
2022 - 2033 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 155 |
2034 - 2037 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 224 |
Unlimited Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 372 |
Federal [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 22 |
Tax Effected NOL | 5 |
Valuation Allowance (VA) | (4) |
NOL Net of VA | 1 |
Federal [Member] | 2018 - 2021 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 6 |
Federal [Member] | 2022 - 2033 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 16 |
State [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 145 |
Tax Effected NOL | 8 |
Valuation Allowance (VA) | (8) |
State [Member] | 2018 - 2021 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 2 |
State [Member] | 2022 - 2033 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 16 |
State [Member] | 2034 - 2037 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 127 |
Foreign [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 649 |
Tax Effected NOL | 169 |
Valuation Allowance (VA) | (145) |
NOL Net of VA | 24 |
Foreign [Member] | 2018 - 2021 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 57 |
Foreign [Member] | 2022 - 2033 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 123 |
Foreign [Member] | 2034 - 2037 Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | 97 |
Foreign [Member] | Unlimited Expiration [Member] | |
Operating Loss Carryforwards [Line Items] | |
Total Net Operating Loss (NOL) | $ 372 |
Business Segments and Geograp89
Business Segments and Geographic Areas - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2017BusinessSegmentCustomer | Dec. 31, 2016Customer | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | Segment | 3 | ||
Number of business units | 17 | ||
Revenue from rentals, percentage | 12.00% | 8.00% | 7.00% |
Customer Concentration Risk [Member] | Revenue [Member] | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, number of customers | Customer | 0 | 0 | |
Concentration risk, percentage | 10.00% | 10.00% | |
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 | 9 | ||
Rig Technologies [Member] | |||
Segment Reporting Information [Line Items] | |||
Number of business units | 2 |
Business Segments and Geograp90
Business Segments and Geographic Areas - Revenues by Country Based on Sales Destination of Products or Services (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | $ 1,969 | $ 1,835 | $ 1,759 | $ 1,741 | $ 1,692 | $ 1,646 | $ 1,724 | $ 2,189 | $ 7,304 | $ 7,251 | $ 14,757 |
United States [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 2,760 | 1,961 | 3,640 | ||||||||
Brazil [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 498 | 242 | 605 | ||||||||
Saudi Arabia [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 310 | 258 | 416 | ||||||||
China [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 298 | 557 | 1,623 | ||||||||
Norway [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 295 | 339 | 555 | ||||||||
Canada [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 286 | 217 | 365 | ||||||||
United Kingdom [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 279 | 299 | 634 | ||||||||
South Korea [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 261 | 495 | 1,835 | ||||||||
United Arab Emirates [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 223 | 334 | 532 | ||||||||
Singapore [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | 188 | 340 | 1,035 | ||||||||
Other Countries [Member] | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Revenue | $ 1,906 | $ 2,209 | $ 3,517 |
Business Segments and Geograp91
Business Segments and Geographic Areas - Long-Lived Assets by Country Based on the Location (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | $ 3,002 | $ 3,150 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 1,675 | 1,810 |
Brazil [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 269 | 281 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 140 | 137 |
Denmark [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 128 | 120 |
South Korea [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 97 | 94 |
Russia [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 90 | 88 |
Canada [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 84 | 82 |
Mexico [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 71 | 77 |
United Arab Emirates [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 65 | 90 |
Singapore [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | 59 | 63 |
Other Countries [Member] | ||
Segment Reporting Information [Line Items] | ||
Property, plant and equipment, net | $ 324 | $ 308 |
Business Segments and Geograp92
Business Segments and Geographic Areas - Business Segments (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 1,969 | $ 1,835 | $ 1,759 | $ 1,741 | $ 1,692 | $ 1,646 | $ 1,724 | $ 2,189 | $ 7,304 | $ 7,251 | $ 14,757 |
Operating profit (loss) | (277) | (2,411) | (390) | ||||||||
Capital expenditures | 192 | 284 | 453 | ||||||||
Depreciation and amortization | 698 | 703 | 747 | ||||||||
Goodwill | 6,227 | 6,067 | 6,227 | 6,067 | 6,980 | ||||||
Total assets | 20,206 | 21,140 | 20,206 | 21,140 | 25,970 | ||||||
Wellbore Technologies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 2,956 | 2,874 | 2,956 | 2,874 | 2,874 | ||||||
Completion & Production Solutions [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 2,122 | 2,058 | 2,122 | 2,058 | 1,997 | ||||||
Rig Technologies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill | 1,149 | 1,135 | 1,149 | 1,135 | 2,109 | ||||||
Operating Segments [Member] | Wellbore Technologies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 2,577 | 2,199 | 3,718 | ||||||||
Operating profit (loss) | (102) | (770) | (1,573) | ||||||||
Capital expenditures | 99 | 124 | 180 | ||||||||
Depreciation and amortization | 379 | 384 | 403 | ||||||||
Goodwill | 2,956 | 2,874 | 2,956 | 2,874 | 2,874 | ||||||
Total assets | 7,848 | 7,911 | 7,848 | 7,911 | 8,766 | ||||||
Operating Segments [Member] | Completion & Production Solutions [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 2,672 | 2,241 | 3,365 | ||||||||
Operating profit (loss) | 98 | (266) | 187 | ||||||||
Capital expenditures | 69 | 61 | 87 | ||||||||
Depreciation and amortization | 215 | 209 | 223 | ||||||||
Goodwill | 2,122 | 2,058 | 2,122 | 2,058 | 1,997 | ||||||
Total assets | 5,782 | 5,765 | 5,782 | 5,765 | 5,916 | ||||||
Operating Segments [Member] | Rig Technologies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 2,252 | 3,110 | 8,279 | ||||||||
Operating profit (loss) | (14) | (1,033) | 1,501 | ||||||||
Capital expenditures | 16 | 24 | 91 | ||||||||
Depreciation and amortization | 88 | 94 | 107 | ||||||||
Goodwill | 1,149 | 1,135 | 1,149 | 1,135 | 2,109 | ||||||
Total assets | 4,625 | 5,327 | 4,625 | 5,327 | 9,227 | ||||||
Eliminations and Corporate Costs [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | (197) | (299) | (605) | ||||||||
Operating profit (loss) | (259) | (342) | (505) | ||||||||
Capital expenditures | 8 | 75 | 95 | ||||||||
Depreciation and amortization | 16 | 16 | 14 | ||||||||
Total assets | $ 1,951 | $ 2,137 | $ 1,951 | $ 2,137 | $ 2,061 |
Quarterly Financial Data (Una93
Quarterly Financial Data (Unaudited) - Summarized Quarterly Results (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 1,969 | $ 1,835 | $ 1,759 | $ 1,741 | $ 1,692 | $ 1,646 | $ 1,724 | $ 2,189 | $ 7,304 | $ 7,251 | $ 14,757 |
Gross profit (loss) | 167 | 285 | 231 | 209 | (459) | 79 | 35 | 244 | 892 | (101) | 3,063 |
Net loss attributable to Company | $ (14) | $ (26) | $ (75) | $ (122) | $ (714) | $ (1,362) | $ (217) | $ (119) | $ (237) | $ (2,412) | $ (769) |
Net loss attributable to Company per basic share | $ (0.04) | $ (0.07) | $ (0.20) | $ (0.32) | $ (1.90) | $ (3.62) | $ (0.58) | $ (0.32) | $ (0.63) | $ (6.41) | $ (1.99) |
Net loss attributable to Company per diluted share | (0.04) | (0.07) | (0.20) | (0.32) | (1.90) | (3.62) | (0.58) | (0.32) | (0.63) | (6.41) | (1.99) |
Cash dividends per share | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.46 | $ 0.20 | $ 0.61 | $ 1.84 |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for Doubtful Accounts [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | $ 209 | $ 159 | $ 125 |
Additions (Deductions) charged to costs and expenses | 6 | 52 | 77 |
Charge off's and other | (28) | (2) | (43) |
Balance end of year | 187 | 209 | 159 |
Reserve for Excess and Obsolete Inventories [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | 1,017 | 500 | 370 |
Additions (Deductions) charged to costs and expenses | 114 | 606 | 186 |
Charge off's and other | (331) | (89) | (56) |
Balance end of year | 800 | 1,017 | 500 |
Valuation Allowance for Deferred Tax Assets [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | 544 | 63 | 48 |
Additions (Deductions) charged to costs and expenses | 280 | 476 | 15 |
Charge off's and other | 378 | 5 | |
Balance end of year | 1,202 | 544 | 63 |
Warranty Reserve [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance beginning of year | 172 | 244 | 272 |
Additions (Deductions) charged to costs and expenses | 46 | 50 | 92 |
Charge off's and other | (83) | (122) | (120) |
Balance end of year | $ 135 | $ 172 | $ 244 |