Document And Entity Information
Document And Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 11, 2022 | Jul. 03, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Trading Symbol | REZI | ||
Entity Registrant Name | Resideo Technologies, Inc. | ||
Entity Central Index Key | 0001740332 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Common Stock, Shares Outstanding | 145,018,673 | ||
Entity Public Float | $ 3.4 | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | ||
Entity File Number | 001-38635 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 82-5318796 | ||
Entity Interactive Data Current | Yes | ||
Security Exchange Name | NYSE | ||
Entity Address, Address Line One | 16100 N 71st Street | ||
Entity Address, Address Line Two | Suite 550 | ||
Entity Address, City or Town | Scottsdale | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85254 | ||
City Area Code | 480 | ||
Local Phone Number | 573-5340 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
ICFR Auditor Attestation Flag | true | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Minneapolis, Minnesota | ||
Auditor Firm ID | 34 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A in connection with the registrant’s 2022 Annual Meeting of Stockholders, which will be filed subsequent to the date hereof, are incorporated by reference into Part III of this Form 10-K. Such proxy statement will be filed with the Securities and Exchange Commission not later than 120 days following the end of the registrant’s fiscal year ended December 31, 2021 . |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Income Statement [Abstract] | ||||
Net revenue | [1] | $ 5,846 | $ 5,071 | $ 4,988 |
Cost of goods sold | 4,285 | 3,758 | 3,711 | |
Gross profit | 1,561 | 1,313 | 1,277 | |
Research and development expenses | 86 | 77 | 87 | |
Selling, general and administrative expenses | 916 | 925 | 932 | |
Operating profit | 559 | 311 | 258 | |
Other expense, net | 158 | 147 | 118 | |
Interest expense | 48 | 63 | 69 | |
Income before taxes | 353 | 101 | 71 | |
Tax expense | 111 | 64 | 35 | |
Net income | $ 242 | $ 37 | $ 36 | |
Weighted Average Number of Common Shares Outstanding (in thousands) | ||||
Basic | 144,036 | 125,348 | 122,722 | |
Diluted | 148,448 | 126,324 | 123,238 | |
Earnings Per Share | ||||
Basic | $ 1.68 | $ 0.30 | $ 0.29 | |
Diluted | $ 1.63 | $ 0.29 | $ 0.29 | |
[1] | Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 242 | $ 37 | $ 36 |
Other comprehensive income (loss), net of tax | |||
Foreign exchange translation adjustment | (57) | 63 | (2) |
Pension actuarial gain | 32 | (15) | (3) |
Changes in fair value of effective cash flow hedges | 6 | ||
Total other comprehensive income (loss), net of tax | (19) | 48 | (5) |
Comprehensive income | $ 223 | $ 85 | $ 31 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 779 | $ 517 |
Accounts receivable – net | 876 | 863 |
Inventories – net | 740 | 672 |
Other current assets | 146 | 173 |
Total current assets | 2,541 | 2,225 |
Property, plant and equipment – net | 287 | 318 |
Goodwill | 2,661 | 2,691 |
Other assets | 364 | 376 |
Total assets | 5,853 | 5,610 |
Current liabilities: | ||
Accounts payable | 883 | 936 |
Current maturities of debt | 10 | 7 |
Accrued liabilities | 601 | 595 |
Total current liabilities | 1,494 | 1,538 |
Long-term debt | 1,220 | 1,155 |
Obligations payable under Indemnification Agreements | 585 | 590 |
Other liabilities | 302 | 334 |
COMMITMENTS AND CONTINGENCIES (Note 17) | ||
EQUITY | ||
Common stock, $0.001 par value, 700,000 shares authorized, 146,248 and 144,808 shares issued and outstanding as of December 31, 2021, 143,959 and 143,059 shares issued and outstanding as of December 31, 2020, respectively | 0 | 0 |
Additional paid-in capital | 2,121 | 2,070 |
Treasury stock, at cost | (21) | (6) |
Retained earnings | 317 | 75 |
Accumulated other comprehensive loss | (165) | (146) |
Total equity | 2,252 | 1,993 |
Total liabilities and equity | $ 5,853 | $ 5,610 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 700,000,000 | 700,000,000 |
Common stock, shares issued | 146,248,000 | 143,959,000 |
Common stock, shares outstanding | 144,808,000 | 143,059,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows provided by (used for) operating activities: | |||
Net income | $ 242 | $ 37 | $ 36 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 88 | 86 | 80 |
Stock compensation expense | 39 | 29 | 25 |
Deferred income taxes | 6 | 22 | (25) |
Loss on extinguishment of debt | 41 | 0 | 0 |
Other | 3 | 21 | 18 |
Changes in assets and liabilities, net of acquired companies: | |||
Accounts receivable | (30) | (27) | 7 |
Inventories – net | (73) | 19 | (44) |
Other current assets | 27 | 5 | (53) |
Other assets | 2 | (15) | |
Accounts payable | (42) | (1) | (38) |
Accrued liabilities | 14 | 31 | 28 |
Obligations payable under Indemnification Agreements | (5) | (4) | (35) |
Other liabilities | 3 | 26 | 39 |
Net cash provided by operating activities | 315 | 244 | 23 |
Cash flows (used for) provided by investing activities: | |||
Expenditures for property, plant, equipment and other intangibles | (63) | (70) | (95) |
Cash paid for acquisitions, net of cash acquired | (11) | (35) | (17) |
Other | 9 | 2 | |
Net cash used for investing activities | (65) | (103) | (112) |
Cash flows provided by (used for) financing activities: | |||
Proceeds from long-term debt | 1,250 | ||
Repayment of long-term debt | (1,188) | (22) | (22) |
Issuance of common stock through public offering, net of issuance cost | 0 | 279 | |
Payment of debt facility issuance and modification costs | (39) | (4) | |
Other | (3) | (4) | (27) |
Net cash provided by (used for) financing activities | 20 | 253 | (53) |
Effect of foreign exchange rate changes on cash and cash equivalents | (8) | 1 | (1) |
Net increase (decrease) in cash and cash equivalents | 262 | 395 | (143) |
Cash and cash equivalents at beginning of year | 517 | 122 | 265 |
Cash and cash equivalents at end of year | 779 | 517 | 122 |
Supplemental Cash Flow Information: | |||
Interest paid | 39 | 57 | 72 |
Income taxes paid (net of refunds) | $ 107 | $ 32 | $ 86 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Common Stock | Treasury Shares | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning Balance at Dec. 31, 2018 | $ 1,533 | $ 1,720 | $ 2 | $ (189) | ||
Beginning Balance, Shares at Dec. 31, 2018 | 122,499,000 | 468,000 | ||||
Net income | 36 | 36 | ||||
Other comprehensive income (loss), net of tax | (5) | (5) | ||||
Issuance of common stock under stock-based compensation plans, net of shares withheld for employee taxes | (3) | $ (3) | ||||
Issuance of common stock under stock-based compensation plans, net of shares withheld for employee taxes, Shares | 374,000 | 147,000 | ||||
Stock-based compensation | 25 | 25 | ||||
Adjustments due to Spin-Off | 16 | 16 | ||||
Ending Balance at Dec. 31, 2019 | 1,602 | $ (3) | 1,761 | 38 | (194) | |
Ending Balance, Shares at Dec. 31, 2019 | 122,873,000 | 615,000 | ||||
Net income | 37 | 37 | ||||
Other comprehensive income (loss), net of tax | 48 | 48 | ||||
Issuance of common stock under stock-based compensation plans, net of shares withheld for employee taxes | (2) | $ (3) | 1 | |||
Issuance of common stock under stock-based compensation plans, net of shares withheld for employee taxes, Shares | 636,000 | 285 | ||||
Stock-based compensation | 29 | 29 | ||||
Issuance of common stock through public offering, net of issuance costs | 279 | 279 | ||||
Issuance of common stock through public offering, net of issuance costs, Shares | 19,550,000 | |||||
Ending Balance at Dec. 31, 2020 | 1,993 | $ (6) | 2,070 | 75 | (146) | |
Ending Balance, Shares at Dec. 31, 2020 | 143,059,000 | 900,000 | ||||
Net income | 242 | 242 | ||||
Other comprehensive income (loss), net of tax | (19) | (19) | ||||
Issuance of common stock under stock-based compensation plans, net of shares withheld for employee taxes | (3) | $ (15) | 12 | |||
Issuance of common stock under stock-based compensation plans, net of shares withheld for employee taxes, Shares | 1,749,000 | 540,000 | ||||
Stock-based compensation | 39 | 39 | ||||
Ending Balance at Dec. 31, 2021 | $ 2,252 | $ (21) | $ 2,121 | $ 317 | $ (165) | |
Ending Balance, Shares at Dec. 31, 2021 | 144,808,000 | 1,440,000 |
Organization, Consolidation and
Organization, Consolidation and Presentation of Financial Statements | 12 Months Ended |
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Operations and Basis of Presentation | Note 1. Organization, Operations and Basis of Presentation Business Description Resideo Technologies, Inc. (“Resideo” or “the Company”), is a leading manufacturer and developer of technology-driven products that provide critical comfort, residential thermal and security solutions to homes globally. The Company is also the leading wholesale distributor of low-voltage security products including intrusion, access control and video products and participates significantly in the broader related markets of smart home, fire, power, audio, ProAV, networking, communications, wire and cable, and data communications. The Company has a global footprint serving commercial and residential end markets. The Company was incorporated in Delaware on April 24, 2018. The Company separated from Honeywell International Inc. (“Honeywell”) on October 29, 2018, becoming an independent publicly traded company as a result of a pro rata distribution of the Company’s common stock to shareholders of Honeywell (the “Spin-Off”). Basis of Presentation The Company’s financial statements are presented on a consolidated basis (collectively, the “Consolidated Financial Statements”). The Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All intercompany transactions have been eliminated for all periods presented. The Company reports financial information on a fiscal quarter basis using a “modified” 4-4-5 calendar (modified in that the fiscal year always begins on January 1 and ends on December 31) that requires its businesses to close their first, second and third quarter books on a Saturday in order to minimize the potentially disruptive effects of quarterly closing on business processes. The effects of this practice are generally not significant to reported results for any quarter and only exist within a reporting year. In the event that differences in closing dates are material to year-over-year comparisons of quarterly or year-to-date results, the Company will provide appropriate disclosures. Reclassification The prior year Consolidated Statements of Operations were reclassified to present research and development expenses as a separate line item within the statements. Research and development expenses were formerly included within Selling, general and administrative expenses. Certain reclassifications have been made to the prior period financial statements to conform to the classification adopted in the current period. Issuance of Common Stock through Public Offering On November 17, 2020 , the Company entered into an underwriting agreement (the “Underwriting Agreement”) which provided for the offer and sale by the Company of 17,000,000 shares of common stock of the Company at the public offering price of $ 15.00 per share (the “Offering”). The Offering closed on November 20, 2020. On December 14, 2020, the Company completed the closing of the exercise of the underwriters’ option to purchase an additional 2,550,000 shares of common stock of the Offering price of $ 15.00 per share as allowed in the Underwriting Agreement. The Company received net proceeds of approximately $ 279 million, after deducting underwriting discounts of $ 13 million and offering expenses payable by the Company of $ 1 million. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Accounting Principles —The financial statements and accompanying notes are prepared in accordance with U.S. GAAP. The following is a description of Resideo’s significant accounting policies. Principles of Consolidation —The Consolidated Financial Statements include the accounts of Resideo Technologies, Inc. and all of its subsidiaries in which a controlling interest is maintained. All intercompany transactions and balances are eliminated in consolidation. Cash and Cash Equivalents —Cash and cash equivalents include cash on hand and highly liquid investments having an original maturity of three months or less. Accounts Receivables and Allowance for Doubtful Accounts —Trade accounts receivable are recorded at the invoiced amount as a result of transactions with customers. The Company maintains allowances for doubtful accounts for estimated losses as a result of customers’ inability to make required payments. The Company estimates anticipated losses from doubtful accounts based on days past due as measured from the contractual due date and historical collection history. The Company also takes into consideration changes in economic conditions that may not be reflected in historical trends, for example customers in bankruptcy, liquidation or reorganization. Receivables are written-off against the allowance for doubtful accounts when they are determined to be uncollectible. Such determination includes analysis and consideration of the particular conditions of the account, including time intervals since last collection, customer performance against agreed upon payment plans, solvency of customer and any bankruptcy proceedings. Inventories —Inventories in the Products & Solutions business are stated at the lower of cost or net realizable value, determined on a first-in, first-out basis, including direct material costs and direct and indirect manufacturing costs, or net realizable value. Inventories in the ADI Global Distribution business are stated at average cost. Reserves are maintained for obsolete and surplus items. Property, Plant and Equipment —Property, plant and equipment are recorded at cost, less accumulated depreciation. For financial reporting, the straight-line method of depreciation is used over the estimated useful lives of 10 to 50 years for buildings and improvements, 3 to 16 years for machinery and equipment and 3 to 10 years for tooling equipment. Goodwill —The Company performs goodwill impairment testing annually, on the first day of the fourth quarter each year or more frequently if indicators of potential impairment exist. The goodwill impairment test is performed at the reporting unit level. The Company has two reporting units, Products & Solutions and ADI Global Distribution. The Company performs its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value provided the loss recognized does not exceed the total amount of goodwill allocated to that reporting unit. Determining the fair value of a reporting unit involves the use of significant estimates and assumptions. For the 2021 annual impairment test, the Company used a weighting of fair values derived from the income approach and market approach. Under the income approach, the Company calculates the fair value of a reporting unit based on the present value of estimated future cash flows. The income approach requires the exercise of significant judgment, including judgment about the amount and timing of expected future cash flows, assumed terminal value, and appropriate discount rates. Under the market approach, the Company utilizes the public company guideline method. The Company believes the estimates and assumptions used in the calculations are reasonable. In addition, the extent to which COVID-19 may adversely impact the Company’s business depends on future developments, which are uncertain and unpredictable, depending upon severity and duration of the outbreak, and the effectiveness of actions taken globally to contain or mitigate its effects. Any resulting financial impact cannot be estimated reasonably at this time but may adversely affect the Company’s business and financial results. It is possible that into 2022, macroeconomic conditions may have unexpected impacts on the Company’s business. If there were an adverse change in facts and circumstances, then an impairment charge may be necessary in the future. Should the fair value of the Company’s reporting units fall below its carrying amount because of reduced operating performance, market declines, changes in the discount rate, or other conditions, charges for impairment may be necessary. The Company monitors its reporting units to determine if there is an indicator of potential impairment. Other Intangible Assets and Long-lived Assets —Other intangible assets with determinable lives consist of customer lists, technology, patents and trademarks and software intangibles and are amortized over their estimated useful lives, ranging from 3 to 15 years. They are reviewed for impairment whenever events or circumstances indicate that the carrying amount of the assets may not be recoverable. Recoverability of long-lived assets are measured by comparison of the carrying amount of the asset to the future undiscounted cash flows the asset is expected to generate. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. Warranties and Guarantees —Expected warranty costs for products sold are recognized based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, length of the warranty and various other considerations. Costs of product recalls, which may include the cost of the product being replaced as well as the customer’s cost of the recall, including labor to remove and replace the recalled part, are accrued as part of the warranty accrual at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. Leases —Effective January 1, 2019, arrangements containing leases are evaluated as an operating or finance lease at lease inception. For operating leases, the Company recognizes an operating right-of-use asset and operating lease liability at lease commencement based on the present value of lease payments over the lease term. Since an implicit rate of return is not readily determinable for the Company’s leases, an incremental borrowing rate is used in determining the present value of lease payments and is calculated based on information available at the lease commencement date. The incremental borrowing rate is determined using a portfolio approach based on the rate of interest the Company would have to pay to borrow funds on a collateralized basis over a similar term. The Company references a market yield curve consistent with the Company’s credit rating which is risk-adjusted to approximate a collateralized rate in the currency of the lease. These rates are updated on a quarterly basis for measurement of new lease obligations. Most leases include renewal options; however, generally it is not reasonably certain that these options will be exercised at lease commencement. Lease expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recognized on the Company’s balance sheet. The Company does not separate lease and non-lease components for its real estate and automobile leases. Revenue Recognition —Product and service revenues are recognized when or as the Company transfers control of the promised products or services to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. In the sale of products, the terms of a contract or the historical business practice can give rise to variable consideration due to, but not limited to, discounts and rebates. The Company estimates variable consideration at the most likely amount that will be received from customers and reduces revenues recognized accordingly. The Company includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information (historical, current and forecasted) that is reasonably available to the Company. Sales, use and value added taxes collected by the Company and remitted to various government authorities were not recognized as revenues and are reported on a net basis. Shipping and handling fees billed to customers were included in Cost of goods sold. Royalty —In connection with the Spin-Off, the Company and Honeywell entered into a 40 -year Trademark License Agreement (“the Trademark Agreement”) that authorizes the Company’s use of certain licensed trademarks in the operation of Resideo’s business for the advertising, sale and distribution of certain licensed products. In exchange, the Company pays a royalty fee of 1.5 % of net revenue of the licensed products to Honeywell which is recorded in Selling, general and administrative expense on the Consolidated Statements of Operations. Reimbursement Agreement —In connection with the Spin-Off the Company entered into an Indemnification and Reimbursement Agreement with Honeywell (the “Reimbursement Agreement”), pursuant to which it has an obligation to make cash payments to Honeywell in amounts equal to 90 % of payments, which include amounts billed, with respect to certain environmental claims, remediation and, to the extent arising after the Spin-Off, hazardous exposure or toxic tort claims, in each case, including consequential damages (the “liabilities”) in respect of specified Honeywell properties contaminated through historical business operations prior to the Spin-Off (“Honeywell Sites”), including the legal and other costs of defending and resolving such liabilities, less 90 % of Honeywell’s net insurance receipts relating to such liabilities, and less 90 % of the net proceeds received by Honeywell in connection with (i) affirmative claims relating to such liabilities, (ii) contributions by other parties relating to such liabilities and (iii) certain property sales. The amount payable in respect of such liabilities arising in any given year is subject to a cap of $ 140 million. Reimbursement Agreement expenses are presented within Other expense, net in the Consolidated Statements of Operations and within Accrued liabilities and Obligations payable under Indemnification Agreements in the Consolidated Balance Sheets. For additional information, see Note 17. Commitments and Contingencies. Environmental —The Company accrues costs related to environmental matters when it is probable that it has incurred a liability related to a contaminated site and the amount can be reasonably estimated. Environmental costs for the Company’s owned sites are presented within Cost of goods sold for operating sites. For additional information, see Note 17. Commitments and Contingencies. Tax Indemnification Agreement —The Tax Matters Agreement provides that Resideo is required to indemnify Honeywell for any taxes (and reasonable expenses) resulting from the failure of the Spin-Off and related internal transactions to qualify for their intended tax treatment under U.S. federal, state and local income tax law, as well as foreign tax law, where such taxes result from (a) breaches of covenants and representations the Company makes and agrees to in connection with the Spin-Off, (b) the application of certain provisions of U.S. federal income tax law to these transactions or (c) any other action taken or omission made (other than actions expressly required or permitted by the Separation and Distribution Agreement, the Tax Matters Agreement or other ancillary agreements) after the consummation of the Spin-Off that gives rise to these taxes. As of December 31, 2021 and December 31, 2020 the Company had an indemnity outstanding to Honeywell for past and potential future tax payments of $ 128 million and $ 139 million, respectively. See Note 17. Commitments and Contingencies. Research and Development —The Company conducts research and development activities, which consist primarily of the development of new products as well as enhancements and improvements to existing products that substantially change the product. Research and development costs primarily relate to employee compensation and consulting fees which are charged to expense as incurred. Advertising Costs— The Company expenses advertising costs as incurred. Advertising costs totaled $ 22 million, $ 25 million and $ 46 million for the years ended December 31, 2021, 2020 and 2019 , respectively. Defined Contribution Plans— The Company sponsors various defined contribution plans with varying terms depending on the country of employment. For the years ended December 31, 2021, 2020 and 2019 the Company recognized compensation expense related to the defined contribution plans of $ 19 million, $ 18 million, and $ 18 million, respectively. Stock-Based Compensation Plans —The principal awards issued under Resideo’s stock-based compensation plans, which are described in Note 5. Stock-Based Compensation Plans, are restricted stock units. The cost for such awards is measured at the grant date based on the fair value of the award. Some awards are issued with a market condition which are valued on the grant date utilizing a Monte Carlo simulation model. Stock options are also issued under Resideo’s stock-based compensation plans and are valued on the grant date using the Black-Scholes option pricing model. The Black-Scholes option pricing model and the Monte Carlo simulation model require estimates of future stock price volatility, expected term, risk-free interest rate and forfeitures. For all stock-based compensation, the fair value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods (generally the vesting period of the equity award) and is included in Selling, general and administrative expenses in the Consolidated Statements of Operations. Forfeitures are estimated at the time of grant to recognize expense for those awards that are expected to vest and are based on historical forfeiture rates. Pension — The Company disaggregates the service cost component of net benefit costs and reports those costs in the same line item or items in the Consolidated Statements of Operations as other compensation costs arising from services rendered by the pertinent employees during the period. The other non-service components of net benefit costs are required to be presented separately from the service cost component and outside of income from operations. The Company has recorded the service cost component of pension expense in Costs of goods sold and Selling, general and administrative expenses based on the classification of the employees it relates to. The remaining components of net benefit costs within pension expense, primarily interest costs and expected return on plan assets, are recorded in Other expense, net. The Company recognizes net actuarial gains or losses in excess of 10 % of the greater of the fair value of plan assets or the plans’ projected benefit obligation (the corridor) annually in the fourth quarter each year. This adjustment known as the mark to market adjustment is reported in Other expense, net. Foreign Currency Translation —Assets and liabilities of operations outside the United States with a functional currency other than U.S. Dollars are translated into U.S. Dollars using year-end exchange rates. Revenue, costs and expenses are translated at the average exchange rates in effect during the year. Foreign currency translation gains and losses are included as a component of Accumulated other comprehensive loss. Income Taxes —Significant judgment is required in evaluating tax positions. The Company establishes additional reserves for income taxes when, despite the belief that tax positions are fully supportable, there remain certain positions that do not meet the minimum recognition threshold. The approach for evaluating certain and uncertain tax positions is defined by the authoritative guidance which determines when a tax position is more likely than not to be sustained upon examination by the applicable taxing authority. In the normal course of business, the Company and its subsidiaries are examined by various federal, state and foreign tax authorities. The Company regularly assesses the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of its provision for income taxes. The Company continually assesses the likelihood and amount of potential adjustments and adjusts the income tax provision, the current tax liability and deferred taxes in the period in which the facts that give rise to a change in estimate become known. Earnings Per Share —Basic earnings per share is based on the weighted average number of common shares outstanding. Diluted earnings per share is based on the weighted average number of common shares outstanding and all dilutive potential common shares outstanding. For additional information, see Note 10. Earnings Per Share. Use of Estimates —The preparation of the Company’s Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the Consolidated Financial Statements and related disclosures in the accompanying notes. Actual results could differ from those estimates. Estimates and assumptions are periodically reviewed, and the effects of changes are reflected in the Consolidated Financial Statements in the period they are determined to be necessary. Estimates are used when accounting for stock-based compensation, pension benefits, indemnification liabilities, goodwill and intangible assets, and valuation allowances for accounts receivable, inventory, deferred tax assets, and the amounts of revenue and expenses reported during the period. Recent Accounting Pronouncements —The Company considers the applicability and impact of all recent accounting standards updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). ASUs not listed below were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s consolidated financial position or results of operations. In August 2018, the FASB issued ASU No. 2018-14, Compensation — Retirement Benefits — Defined Benefit Plans — General (Topic 715-20): Disclosure Framework — Changes to the Disclosure Requirements for Defined Benefit Plans , which amends the current disclosure requirements regarding defined benefit pensions and other post retirement plans and allows for the removal of certain disclosures, while adding certain new disclosure requirements. The Company adopted the standard effective January 1, 2020 and the adoption did not have a material financial statement impact. In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) . This ASU simplifies the accounting for income taxes by, among other things, eliminating certain existing exceptions related to the general approach in ASC 740 relating to franchise taxes, reducing complexity in the interim-period accounting for year-to-date loss limitations and changes in tax laws, and clarifying the accounting for transactions outside of business combinations that result in a step-up in the tax basis of goodwill. The Company early adopted the provisions of this guidance on January 1, 2020. Adoption of this guidance did not have a material financial statement impact. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which is optional guidance related to reference rate reform that provides practical expedients for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. This guidance along with its subsequent clarifications, is effective from March 12, 2020 through December 31, 2022 and is applicable for the Company’s A&R Senior Credit Facilities and Swap Agreements, which use LIBOR as a reference rate. The A&R Senior Credit Facilities include a transition clause to a new reference rate in the event LIBOR is discontinued and Swap Agreements will be amended to match the new reference rate. We are currently evaluating the potential impact of adopting this guidance, but do not expect it to have a material impact on our consolidated financial statements. Refer to Note 18. Long-term Debt and Credit Agreement for further details on the Company’s Swap Agreements and A&R Senior Credit Facilities. |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 3. Revenue Recognition Disaggregated Revenue Revenues by geography and business line are as follows for the years ended December 31: Years Ended December 31, 2021 2020 2019 Comfort $ 1,207 $ 1,079 $ 1,103 Security 667 538 520 Residential Thermal Solutions 594 504 552 Products & Solutions 2,468 2,121 2,175 U.S. and Canada 2,814 2,427 2,294 EMEA (1) 523 480 459 APAC (2) 41 43 60 ADI Global Distribution 3,378 2,950 2,813 Net revenue $ 5,846 $ 5,071 $ 4,988 (1) EMEA represents Europe, the Middle East and Africa. (2) APAC represents Asia and Pacific countries. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For product sales, typically each product sold to a customer represents a distinct performance obligation. The Company recognizes the majority of its revenue from performance obligations outlined in contracts with its customers that are satisfied at a point in time. Approximately 3 % of the Company’s revenue is satisfied over time. As of December 31, 2021 and December 31, 2020, contract assets and liabilities were not material. The timing of satisfaction of the Company’s performance obligations does not significantly vary from the typical timing of payment. For some contracts, the Company may be entitled to receive an advance payment. The Company has applied the practical expedient to not disclose the value of remaining performance obligations for (i) contracts with an original expected term of one year or less or (ii) contracts for which it recognizes revenue in proportion to the amount it has the right to invoice for services performed. |
Segment Financial Data
Segment Financial Data | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Financial Data | Note 4. Segment Financial Data The Company monitors its business operations through two operating segments, Products & Solutions and ADI Global Distribution and reports Corporate separately from the two operating segments. Products & Solutions —The Products & Solutions business is a leading global provider of products, software solutions and technologies that help homeowners stay connected and in control of their comfort, security and energy use. ADI Global Distribution —The ADI Global Distribution business is the leading wholesale distributor of low-voltage security products including intrusion, access control and video products and participates significantly in the broader related markets of smart home, fire, access control, power, audio, ProAV, networking, communications, wire and cable, and data communications. Corporate —Corporate includes expenses associated with legal, finance, information technology, human resources, strategy and communications related to the Corporate office as well as supporting the operating segments, but do not relate directly to revenue-generating activities. Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. Years Ended December 31, 2021 2020 2019 Revenue Total Products & Solutions revenue $ 2,841 $ 2,488 $ 2,487 Less: Intersegment revenue 373 367 312 External Products & Solutions revenue 2,468 2,121 2,175 External ADI Global Distribution revenue 3,378 2,950 2,813 Total revenue $ 5,846 $ 5,071 $ 4,988 Years Ended December 31, 2021 2020 2019 Operating profit Products & Solutions $ 541 $ 407 $ 327 ADI Global Distribution 268 194 210 Corporate ( 250 ) ( 290 ) ( 279 ) Total $ 559 $ 311 $ 258 Years Ended December 31, 2021 2020 2019 Depreciation and amortization Products & Solutions $ 65 $ 63 $ 62 ADI Global Distribution 11 12 10 Corporate 12 11 8 Total $ 88 $ 86 $ 80 Years Ended December 31, 2021 2020 2019 Capital expenditures Products & Solutions $ 37 $ 41 $ 71 ADI Global Distribution 24 15 5 Corporate 2 14 19 Total $ 63 $ 70 $ 95 The Company’s CODM does not use segment assets information to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2021 | |
Compensation Related Costs [Abstract] | |
Stock-Based Compensation Plans | Note 5. Stock-Based Compensation Plans On October 29, 2018, the Board adopted, and Honeywell, as the Company’s sole shareholder, approved, the 2018 Stock Incentive Plan of Resideo Technologies, Inc. and its Affiliates and the 2018 Stock Incentive Plan for Non-Employee Directors of Resideo Technologies, Inc. as may be amended from time to time (together, the “Stock Incentive Plan”). On or about December 21, 2018, the Board adopted the Amended and Restated 2018 Stock Incentive Plan of Resideo Technologies, Inc. and its Affiliates. The Stock Incentive Plan provides for the grant of stock options, stock appreciation rights, restricted stock units, restricted stock, other stock-based awards and cash-based awards. The maximum aggregate number of shares of the Company’s common stock that may be issued under awards granted under the Stock Incentive Plan is 16 million. As of December 31, 2021, 6,357,544 shares of the Company’s common stock were available to be granted under the Stock Incentive Plan. Summary of Restricted Stock Unit Activity Restricted stock unit (“RSU”) awards entitle the holder to receive one share of common stock for each unit when the units vest. RSUs are issued to certain key employees and to non-employee directors. RSUs typically become fully vested over periods ranging from one to seven years and are payable in Resideo common stock upon vesting. Performance stock unit (“PSU”) awards entitle the holder to receive a specified number of common stock, dependent on Company financial metrics or market conditions, for each unit when the units vest. PSUs are issued to certain key employees. PSUs typically become fully vested over a period of three years and are payable in Resideo common stock upon vesting. For the year ended December 31, 2019, PSUs were issued with the shares awarded per unit being evenly based on Net revenue and adjusted EBITDA performance. For the years ended December 31, 2020 and 2021, PSUs were issued with the shares awarded per unit being based on the difference in performance between the total stockholders’ return of the Company against that of the S&P 400 Industrials Index. The fair values estimated from the Monte Carlo simulation for PSUs issues during the years ended December 31, 2021 and 2020 were calculated using the following assumptions: December 31, 2021 2020 Expected volatility 47.43 % 33.70 % Risk-free interest rate % 0.20 % 0.80 % Expected term (in years) 2.86 2.79 Dividend yield 0 % 0 % The following table summarizes RSU and PSU and activity related to the Stock Incentive Plan during the years ended December 31, 2021, 2020 and 2019: PSUs RSUs Number of Weighted Number of Weighted Non-vested as of January 1, 2019 - $ - 3,338,184 $ 24.05 Granted 322,037 24.32 1,285,167 21.21 Vested - - ( 509,366 ) 23.78 Forfeited ( 45,756 ) 24.39 ( 595,735 ) 24.05 Non-vested as of December 31, 2019 276,281 24.33 3,518,250 23.05 Granted 795,099 6.33 2,262,676 10.55 Vested - - ( 921,060 ) 21.07 Forfeited ( 158,580 ) 16.06 ( 572,902 ) 19.27 Non-vested as of December 31, 2020 912,800 10.09 4,286,964 17.38 Granted 500,227 42.98 1,142,310 27.39 Vested - - ( 1,714,810 ) 19.27 Forfeited ( 95,467 ) 17.20 ( 237,331 ) 20.44 Non-vested as of December 31, 2021 1,317,560 $ 22.06 3,477,133 $ 19.52 As of December 31, 2021 , there was approximately $ 19 million and $ 11 million of total unrecognized compensation cost related to non-vested RSUs and PSUs granted under the Stock Incentive Plan, which is expected to be recognized over a weighted-average period of 1.4 years and 2.0 years, respectively. The fair value of RSUs that vested during the year ended December 31, 2021 is $ 48 million. Summary of Stock Option Activity Stock option awards entitle the holder to purchase shares of common stock at a specific price when the options vest. Stock options typically vest over three years from the date of grant and expire seven years from the grant date. The fair value of stock options was calculated using the following assumptions in the Black-Scholes model: December 31, 2021 2020 2019 Expected stock price volatility 34 % 31 % - 37 % 30 % - 32 % Expected term of options 5 years 4.5 years 4.5 years Expected dividend yield — — — Risk-free interest rate 0.77 % 0.25 % - 1.41 % 2.22 % - 2.47 % The aggregate intrinsic value disclosed below represents the total intrinsic value (the difference between the fair market value of the Company’s common stock as of December 31, 2021, and the exercise price, multiplied by the number of in-the-money service-based stock options) that would have been received by the option holders had all option holders exercised their options on December 31, 2021. This amount is subject to change based on changes to the fair market value of the Company’s common stock. The following table summarizes stock option activity related to the Stock Incentive Plan during the year ended December 31, 2021: Stock Options Number of Weighted Weighted Aggregate Stock Options outstanding as of January 1, 2019 - $ - - $ - Granted 1,155,566 24.37 Forfeited ( 165,312 ) 24.39 Stock Options outstanding as of December 31, 2019 990,254 24.36 6.0 - Granted 1,083,665 9.17 Forfeited ( 348,696 ) 18.39 Stock Options outstanding as of December 31, 2020 1,725,223 15.98 4.9 12 Granted 150,000 25.48 Forfeited ( 152,831 ) 16.47 Exercised ( 376,424 ) 21.62 3 Stock Options outstanding as of December 31, 2021 1,345,968 15.41 4.9 14 Vested and expected to vest at December 31, 2021 1,165,667 15.52 4.8 12 Exercisable at December 31, 2021 443,956 $ 18.27 4.2 $ 3 Stock options granted during the year ended December 31, 2021 had a weighted average grant date fair value per share of $ 7.69 . As of December 31, 2021 , there was approximately $ 1 million of total unrecognized compensation cost related to non-vested stock options granted under the Stock Incentive Plan, which is expected to be recognized over a weighted-average period of 2.05 years. Summary of Stock-Based Compensation The following table summarizes stock-based compensation expense and the related tax benefits under the Company’s plans: Years Ended December 31, 2021 2020 2019 Stock-based compensation expense before income taxes $ 39 $ 29 $ 25 Less: Income tax expense (benefit) ( 3 ) 1 ( 1 ) Stock-based compensation expense, net of income taxes $ 36 $ 30 $ 24 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 6. Leases The Company is party to operating leases for the majority of its manufacturing sites, offices, engineering and lab sites, stocking locations, warehouses, automobiles, and certain equipment. Certain of the Company’s real estate leases include variable rental payments which adjust periodically based on inflation, and certain automobile lease agreements include rental payments which fluctuate based on mileage. Generally, the Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company’s operating lease costs for the years ended December 31, 2021 and 2020 consisted of the following: Years Ended December 31, 2021 2020 2019 Selling, general and administrative expenses $ 46 $ 44 $ 37 Cost of goods sold 17 17 16 Total operating lease costs $ 63 $ 61 $ 53 Total operating lease costs include variable lease costs of $ 17 million, $ 16 million and $ 11 million for the years ended December 31, 2021, 2020, and 2019, respectively. Total operating lease costs also include offsetting sub-lease income which is immaterial for the years ended December 31, 2021, 2020, and 2019. The Company recognized the following related to its operating leases: Financial At December 31, At December 31, Operating right-of-use assets Other assets $ 141 $ 133 Operating lease liabilities - current Accrued liabilities $ 32 $ 33 Operating lease liabilities - non-current Other liabilities $ 120 $ 107 Maturities of the Company’s operating lease liabilities were as follows: At December 31, 2022 $ 39 2023 35 2024 25 2025 20 2026 17 Thereafter 43 Total lease payments 179 Less: Imputed interest 27 Present value of operating lease liabilities $ 152 Weighted-average remaining lease term (years) 6.04 Weighted-average incremental borrowing rate 5.42 % Supplemental cash flow information related to the Company’s operating leases was as follows: Years Ended December 31, 2021 2020 2019 Operating cash outflows $ 33 $ 30 $ 35 Operating right-of-use assets obtained in exchange for operating lease liabilities $ 46 $ 26 $ 60 As of December 31, 2021, the Company has additional operating leases that have not yet commenced. Obligations under these leases are not material. Additionally, as a lessor, the Company leases all or a portion of certain owned properties. Rental income for the years ended December 31, 2021, 2020 and 2019 was not material. |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Dec. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Note 7. Restructuring Charges During 2021, the Company did not have any new restructuring programs. Restructuring expense for December 31, 2021 was not material. During 2019, the Company retained industry experts in supply chain optimization and organizational excellence to assist in a comprehensive financial and operational review which was focused on product cost and gross margin improvement, and general and administrative expense simplification. Certain restructuring actions were implemented under this program as well as previous programs. Product & Solutions segment restructuring expenses for the years ended December 31, 2020 and 2019 were $ 19 million, and $ 26 million, respectively. ADI Global Distribution segment restructuring expenses for the years ended December 31, 2020 and 2019 were $ 6 million, and $ 4 million, respectively. Corporate restructuring expenses for the years ended December 31, 2020 and 2019 were $ 15 million, and $ 7 million, respectively. Restructuring expenses for all periods are primarily related to severance. The Company’s restructuring expenses for 2020 and 2019 are as follows: Years Ended December 31, 2020 2019 Cost of goods sold $ 9 $ 13 Research and development expenses 3 7 Selling, general and administrative expenses 28 17 $ 40 $ 37 The following table summarizes the status of total restructuring reserves related to severance cost included in Accrued liabilities in the Consolidated Balance Sheets: Years Ended December 31, 2021 2020 2019 Beginning of year $ 24 $ 19 $ 13 Charges - 40 38 Usage ( 11 ) ( 35 ) ( 31 ) Other ( 4 ) - ( 1 ) End of year $ 9 $ 24 $ 19 |
Other Expense, Net
Other Expense, Net | 12 Months Ended |
Dec. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Other Expense, Net | Note 8. Other Expense, Net Years Ended December 31, 2021 2020 2019 Reimbursement Agreement expense $ 146 $ 146 $ 108 Loss on extinguishment of debt 41 - - Other, net ( 29 ) 1 10 $ 158 $ 147 $ 118 Refer to Note 17. Commitments and Contingencies for further details on environmental and Reimbursement Agreement expense. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9. Income Taxes Income before taxes Years Ended December 31, 2021 2020 2019 U.S. $ 79 $ ( 93 ) $ ( 83 ) Non-U.S. 274 194 154 $ 353 $ 101 $ 71 Income tax expense (benefit) Years Ended December 31, 2021 2020 2019 Tax expense (benefit) consists of: Current: U.S. $ 60 $ 21 $ 23 Non-U.S. 45 21 37 $ 105 $ 42 $ 60 Deferred: U.S. $ 5 $ 11 $ ( 11 ) Non-U.S. 1 11 ( 14 ) 6 22 ( 25 ) $ 111 $ 64 $ 35 Reconciliation of effective income tax rate Years Ended December 31, 2021 2020 2019 U.S. federal statutory income tax rate 21.0 % 21.0 % 21.0 % Impact of foreign operations ( 0.2 ) ( 5.4 ) ( 10.2 ) U.S. state income taxes 3.6 6.4 6.6 Non-deductible indemnification costs 8.4 29.0 28.0 Executive compensation over $ 1 million 0.9 2.5 0.6 Other non-deductible expenses 0.4 3.7 2.9 U.S. taxation of foreign earnings 1.4 3.5 5.3 Tax credits ( 0.7 ) ( 0.2 ) ( 2.6 ) Change in tax rates ( 1.0 ) 1.3 1.7 All other items – net ( 2.5 ) 1.8 ( 4.7 ) 31.3 % 63.6 % 48.6 % Deferred tax assets (liabilities) Years Ended December 31, 2021 2020 Deferred tax assets: Pension $ 24 $ 37 Other asset basis differences 63 70 Operating lease liabilities 33 34 Accruals and reserves 50 61 Net operating and capital losses 48 47 Other 2 - Gross deferred tax assets 220 249 Valuation allowance ( 63 ) ( 60 ) Total deferred tax assets $ 157 $ 189 Deferred tax liabilities: Other intangible assets $ ( 39 ) $ ( 44 ) Property, plant and equipment ( 23 ) ( 25 ) Operating lease assets ( 33 ) ( 32 ) Other ( 5 ) ( 13 ) Total deferred tax liabilities ( 100 ) ( 114 ) Net deferred tax asset $ 57 $ 75 The Company maintains a valuation allowance of $ 63 million against a portion of non-U.S. deferred tax assets. Valuation allowances principally relate to foreign net operating loss carryforwards. As of December 31, 2021, the total undistributed earnings of the Company’s foreign affiliates was $ 1.9 billion, of which $ 6 million was not considered indefinitely reinvested. While these earnings would not be subject to incremental U.S. tax, if the Company were to actually distribute these earnings, they could be subject to additional foreign income taxes and/or withholding taxes payable in foreign jurisdictions. Thus, the Company provides for foreign income taxes payable upon future distributions of the earnings not considered indefinitely reinvested annually. For the year ended December 31, 2021, the tax charge related to earnings that are not considered indefinitely reinvested is not material. The remaining $ 1.9 billion of earnings are considered indefinitely reinvested. Determination of the unrecognized deferred foreign income tax liability related to these undistributed earnings is not practicable due to the complexities associated with this hypothetical calculation. As of December 31, 2021 , the Company has foreign net operating loss carryforwards of $ 189 million. $ 171 million of foreign net operating losses can be carried forward indefinitely with the remainder expiring between 2022 and 2031 . As of December 31, 2021, 2020, and 2019 there were $ 16 million, $ 10 million, and $ 6 million of unrecognized tax benefits, respectively, that if recognized would be recorded as a component of Income tax expense. The change in unrecognized tax benefits resulted in increases of $ 6 million, $ 4 million, and $ 4 million to tax expense in 2021, 2020, and 2019, respectively. The increase in unrecognized tax benefits were largely driven by tax positions taken during the respective years. The Company does not anticipate significant changes in total unrecognized tax benefits during the next twelve months. The Company files income tax returns in the United States federal jurisdiction, all states, and various local and foreign jurisdictions. The Company’s US federal returns are no longer subject to income tax examinations for taxable years before 2017. With limited exception, state, local, and foreign income tax returns for taxable years before 2016 are no longer subject to examination. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 10. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (in millions except shares in thousands and per share data): Years Ended December 31, 2021 2020 2019 Net income $ 242 $ 37 $ 36 Shares used in computing basic earnings per share 144,036 125,348 122,722 Effect of dilutive securities: Dilutive effect of common stock equivalents 4,412 976 516 Shares used in computing diluted earnings per share 148,448 126,324 123,238 Earnings per share: Basic $ 1.68 $ 0.30 $ 0.29 Diluted $ 1.63 $ 0.29 $ 0.29 Diluted Earnings Per Share is computed based upon the weighted average number of common shares outstanding for the year plus the dilutive effect of common stock equivalents using the treasury stock method and the average market price of the Company’s common stock for the period. For the year ended December 31, 2021 , average options and other rights to purchase approximately 0.2 million shares of common stock were outstanding, all of which were anti-dilutive during the year ended December 31, 2021 , and therefore excluded from the computation of diluted earnings per common share. Additionally, an average of approximately 0.6 million shares of performance-based unit awards are excluded from the computation of diluted earnings per common share for the year ended December 31, 2021 as the contingency has not been satisfied at December 31, 2021. For the year ended December 31, 2020 , average option and other rights to purchase approximately 2.8 million shares of common stock were outstanding, all of which were anti-dilutive during the year ended December 31, 2020 , and therefore excluded from the computation of diluted earnings per common share. Additionally, an average of approximately 0.2 million shares of performance-based unit awards are excluded from the computation of diluted earnings per common share for the year ended December 31, 2020 as the contingency has not been satisfied at December 31, 2020 . |
Accounts Receivable - Net
Accounts Receivable - Net | 12 Months Ended |
Dec. 31, 2021 | |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | |
Accounts Receivable - Net | Note 11. Accounts Receivable — Net December 31, 2021 2020 Accounts receivable $ 885 $ 875 Allowance for doubtful accounts ( 9 ) ( 12 ) $ 876 $ 863 |
Inventories Net
Inventories Net | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories Net | Note 12. Inventories — Net December 31, 2021 2020 Raw materials $ 174 $ 127 Work in process 17 19 Finished products 549 526 $ 740 $ 672 The expense related to inventory obsolescence was $ 8 million, $ 31 million and $ 56 million for the years ended December 31, 2021, 2020 and 2019 , respectively. |
Property, Plant, and Equipment
Property, Plant, and Equipment - Net | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment - Net | Note 13. Property, Plant and Equipment — Net December 31, 2021 2020 Machinery and equipment $ 602 $ 598 Buildings and improvements 292 289 Construction in progress 35 46 Others 4 14 933 947 Accumulated depreciation ( 646 ) ( 629 ) $ 287 $ 318 Depreciation expense was $ 58 million, $ 56 million and $ 50 million in 2021, 2020 and 2019 , respectively. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Acquisitions | Note 14. Acquisitions During 2021, the Company completed the acquisition of Norfolk Wire & Electronics, a regional distributor of data communications products and Shoreview Distribution, a U.S. distributor of ProAV products which have been integrated into the ADI Global Distribution segment. The aggregate purchase price paid for these acquisitions was $ 11 million. In February 2020, the Company completed the acquisition of privately held Herman ProAV, a leading provider and distributer of professional audio-visual products, procurement services and labor resources to systems integrators in the commercial audio-visual industry. The purchase price paid for this acquisition was approximately $ 36 million and the Company recognized goodwill and intangible assets of $ 4 million and $ 18 million, respectively. This acquisition was integrated into and builds upon ADI Global Distribution’s product portfolio and expands its presence in the pro-AV market. These acquisitions have an immaterial financial statement impact on both an individual basis and when considered in the aggregate. Pro-forma disclosures are not provided as the acquisitions have an immaterial financial statement impact. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets - Net | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets - Net | Note 15. Goodwill and Other Intangible Assets — Net Goodwill as of December 31, 2021 and 2020 for Products & Solutions was $ 2,010 million and $ 2,037 million, respectively. The decrease primarily relates to foreign currency translation adjustments. Goodwill as of December 31, 2021 and 2020 for ADI Global Distribution was $ 651 million and $ 654 million, respectively. The carrying value of goodwill increased by $ 5 million due to acquisitions during the year which was offset by foreign currency translation adjustments. Other intangible assets with finite lives are comprised of: December 31, 2021 December 31, 2020 Gross Accumulated Net Gross Accumulated Net Patents and technology $ 31 $ ( 23 ) $ 8 $ 37 $ ( 23 ) $ 14 Customer relationships 162 ( 106 ) 56 192 ( 122 ) 70 Trademarks 14 ( 8 ) 6 15 ( 8 ) 7 Software 162 ( 112 ) 50 146 ( 102 ) 44 $ 369 $ ( 249 ) $ 120 $ 390 $ ( 255 ) $ 135 Other intangible assets amortization expense was $ 30 million, $ 31 million and $ 30 million in 2021, 2020 and 2019, respectively. Estimated intangible asset amortization expense for each of the next five years approximates $ 24 million in 2022, $ 21 million in 2023, $ 19 million in 2024, $ 18 million in 2025 and $ 14 million in 2026. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Note 16. Accrued Liabilities December 31, 2021 2020 Obligations payable under Indemnification Agreements $ 140 $ 140 Taxes payable 54 62 Compensation, benefit and other employee-related 114 105 Customer rebate reserve 94 91 Other 199 197 $ 601 $ 595 Refer to Note 17. Commitments and Contingencies for further details on Obligations payable under Indemnification Agreements. |
Long-term Debt and Credit Agree
Long-term Debt and Credit Agreement | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Long-term Debt and Credit Agreement | Note 18. Long-term Debt and Credit Agreement The Company’s debt at December 31, 2021 and December 31, 2020 consisted of the following: December 31, 2021 2020 6.125 % Senior notes due 2026 $ - $ 400 4.000 % Senior notes due 2029 300 - Five-year variable rate term loan A due 2023 - 315 Seven-year variable rate term loan B due 2025 - 465 Seven-year variable rate term loan B due 2028 943 - Unamortized deferred financing costs ( 13 ) ( 18 ) Total outstanding indebtedness 1,230 1,162 Less: Amounts expected to be paid within one year 10 7 Total long-term debt due after one year $ 1,220 $ 1,155 Scheduled principal repayments under the Senior Credit Facilities (defined below) and Senior Notes (defined below) subsequent to December 31, 2021 are as follows: December 31, 2021 2022 $ 10 2023 10 2024 10 2025 10 2026 10 Thereafter 1,193 1,243 Amounts expected to be paid within one year 10 $ 1,233 At December 31, 2021, the interest rate for the A&R Term B Facility (defined below) was 2.75 %. At December 31, 2020, the interest rate for the Five-year variable rate term loan A due 2023 and the Seven-year variable term loan B due 2025 was 2.51 %. At December 31, 2021 there were no borrowings and no letters of credit issued under the A&R Revolving Credit Facility (defined below). As a result of the redemption of the Senior Notes due 2026 (defined below) and the execution of the A&R Credit Agreement (defined below), debt extinguishment costs of $ 41 million were incurred and recorded in Other expense, net for the year ended December 31, 2021. As of December 31, 2021, the Company was in compliance with all covenants related to the A&R Credit Agreement and Senior Notes due 2029. Senior Notes Redemptions On February 16, 2021 the Company redeemed $ 140 million in principal amount of the 6.125 % senior unsecured notes (the “ Senior Notes due 2026 ” ) at a redemption price of 106.125 % of par plus accrued interest. On August 26, 2021, the Company redeemed the remaining $ 260 million in principal amount of the Senior Notes due 2026 at a redemption price of 105.594 % of par plus accrued interest. Senior Notes due 2029 On August 26, 2021, the Company issued $ 300 million in principal amount 4 % senior unsecured notes due in 2029 (the “ Senior Notes due 2029 ” ). The Senior Notes due 2029 are senior unsecured obligations of Resideo guaranteed by Resideo’s existing and future domestic subsidiaries and rank equally with all of Resideo’s senior unsecured debt and senior to all of Resideo’s subordinated debt. The Company may, at its option, redeem the Senior Notes due 2029 in whole (at any time) or in part (from time to time), at varying prices based on the timing of the redemption. The Senior Notes due 2029 limit the Company and its restricted subsidiaries ’ ability to, among other things, incur additional secured indebtedness and issue preferred stock; enter into certain sale and leaseback transactions; incur liens; and consolidate, merge or sell all or substantially all of their assets. These covenants are subject to a number of limitations and exceptions. Additionally, upon certain events constituting a change of control together with a ratings downgrade, the holders of the Senior Notes due 2029 have the right to require the Company to offer to repurchase the Senior Notes due 2029 at a purchase price equal to 101 % of their principal amount, plus accrued and unpaid interest, to (but not including) the date of purchase. Credit Agreement On February 12, 2021, the Company entered into an Amendment and Restatement Agreement with JP Morgan Chase Bank N.A. as administrative agent (the “A&R Credit Agreement”). This agreement effectively replaced the Company’s previous senior secured credit facilities. The A&R Credit Agreement provides for a (i) seven-year senior secured term B loan facility in an aggregate principal amount of $ 950 million (the “A&R Term B Facility”) and (ii) a five-year senior secured revolving credit facility in an aggregate principal amount of $ 500 million (the “A&R Revolving Credit Facility” and, together with the Term Loan Facilities, the “A&R Senior Credit Facilities”). The Company is obligated to make quarterly principal payments throughout the term of the A&R Term B Facility according to the amortization provisions in the A&R Credit Agreement. In addition to paying interest on outstanding borrowings under the A&R Revolving Credit Facility, the Company is required to pay a quarterly commitment fee based on the unused portion of the A&R Revolving Credit Facility. Borrowings under the A&R Credit Agreement can be prepaid at the Company’s option without premium or penalty other than a 1.00 % prepayment premium that may be payable in connection with certain repricing transactions within a certain period of time after the closing date. Up to $ 75 million may be utilized under the A&R Revolving Credit Facility for the issuance of letters of credit to the Company or any of the Company’s subsidiaries. The A&R Senior Credit Facilities are subject to an interest rate and interest period which the Company will elect. If the Company chooses to make a base rate borrowing on an overnight basis, the interest rate will be based on the highest of (1) the rate of interest last quoted by The Wall Street Journal as the “prime rate” in the United States, (2) the greater of the federal funds effective rate and the overnight bank funding rate, plus 0.5 % and (3) the one month adjusted LIBOR rate, plus 1.00 % per annum. For the A&R Term Loan B Facility, the applicable LIBOR rate will not be less than 0.50 % per annum. The applicable margin for the A&R Term B Facility is 2.25 % per annum (for LIBOR loans) and 1.25 % per annum (for base rate loans). The applicable margin for the A&R Revolving Credit Facility varies from 2.25 % per annum to 1.75 % per annum (for LIBOR loans) and 1.25 % to 0.75 % per annum (for base rate loans) based on the Company’s leverage ratio. The A&R Credit Agreement contains certain financial maintenance covenants and affirmative and negative covenants customary for financings of this type. All obligations under the A&R Senior Credit Facilities are unconditionally guaranteed jointly and severally by the Company and substantially all of the direct and indirect wholly owned subsidiaries of the Company that are organized under the laws of the United States (collectively, the “Guarantors”). The A&R Senior Credit Facilities are secured on a first priority basis by the equity interests of each direct subsidiary of the Company, as well as the tangible and intangible personal property and material real property of the Company and each of the Guarantors. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Note 19. Derivative Instruments The Company uses interest rate swap agreements to manage exposure to interest rate risks. The Company does not use interest rate swap agreements for speculative or trading purposes. The gain or loss on the interest rate swaps that qualify as derivatives is recorded in Accumulated other comprehensive loss and is subsequently recognized as Interest expense in the Consolidated Statements of Operations when the hedged exposure affects earnings. If the related debt or the interest rate swap is terminated prior to maturity, the fair value of the interest rate swap recorded in Accumulated other comprehensive loss may be recognized in the Consolidated Statements of Operations based on an assessment of the agreements at the time of termination. In March 2021, the Company entered into eight interest rate swap agreements (the “Swap Agreements”) with several financial institutions for a combined notional value of $ 560 million. The effect of the Swap Agreements is to convert a portion of the Company’s variable interest rate obligations based on three-month LIBOR with a minimum rate of 0.50 % per annum to a base fixed weighted average rate of 0.9289 % over terms ranging from three to five years . The Swap Agreements are adjusted to fair value on a quarterly basis. Contract gains or losses recognized in other comprehensive income (loss) and amounts reclassified from Accumulated other comprehensive loss into earnings were not material for any of the periods presented. Amounts expected to be reclassified into earnings in the next 12 months were not material as of December 31, 2021. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measures | 12 Months Ended |
Dec. 31, 2021 | |
Financial Instruments And Fair Value Measures [Abstract] | |
Financial Instruments and Fair Value Measures | Note 20. Financial Instruments and Fair Value Measures Fair Value of Financial Instruments — The FASB’s accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The FASB’s guidance classifies the inputs used to measure fair value into the following hierarchy: Level 1 Quoted prices in active markets for identical assets or liabilities; Level 2 Observable inputs other than the quoted prices in active markets for identical assets and liabilities; and Level 3 Unobservable inputs for which there is little or no market data, which require the Company to develop assumptions of what market participants would use in pricing the asset or liability. Financial and non-financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Credit and Market Risk— The Company continually monitors the creditworthiness of its customers to which it grants credit terms in the normal course of business. The terms and conditions of credit sales are designed to mitigate or eliminate concentrations of credit risk with any single customer. Foreign Currency Risk Management— The Company conducts its business on a multinational basis in a wide variety of foreign currencies. It is exposed to market risks from changes in currency exchange rates. These exposures may impact future earnings and/or operating cash flows. The exposure to market risk for changes in foreign currency exchange rates arises from transactions arising from international trade, foreign currency denominated monetary assets and liabilities, and international financing activities between subsidiaries. The Company relies primarily on natural offsets to address the exposures and may supplement this approach from time to time by entering into forward and option hedging contracts. As of December 31, 2021 and 2020, the Company had no forward or option hedging contracts. Senior Notes and Credit Agreement— As of December 31, 2021, the Company assessed the amount recorded under the A&R Term B Facility, the Senior Notes due 2029, and the Revolving Credit Facility. The Company determined that the Revolving Credit Facility approximated fair value. The A&R Term B Facility and the Senior Notes due 2029 ’ s fair values are approximately $ 943 million and $ 294 million, respectively. The fair values of the debt are based on the quoted inactive prices and are therefore classified as Level 2 within the valuation hierarchy. Derivative Instruments— The fair value of the Swap Agreements at December 31, 2021 was not material. The estimated fair value is based on Level 2 inputs primarily including the forward LIBOR curve available to swap dealers. The carrying value of cash and cash equivalents, accounts receivables - net, and accounts payables contained in the Consolidated Balance Sheets approximates fair value. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 17. Commitments and Contingencies Environmental Matters The Company is subject to various federal, state, local, and foreign government requirements relating to the protection of the environment. It believes that, as a general matter, its policies, practices and procedures are properly designed to prevent unreasonable risk of environmental damage and personal injury and that its handling, manufacture, use and disposal of hazardous substances are in accordance with environmental and safety laws and regulations. The Company has incurred remedial response and voluntary cleanup costs for site contamination and is a party to claims associated with environmental and safety matters, including products containing hazardous substances. Additional claims and costs involving environmental matters are likely to continue to arise in the future. Liabilities for environmental costs were $ 22 million for each of the years ended December 31, 2021, 2020, and 2019. For the years ended December 31, 2021, 2020, and 2019, environmental expenses related to these liabilities were not material. Obligations Payable Under Indemnification Agreements The indemnification and reimbursement agreement (the “Reimbursement Agreement”) and the tax matters agreement (the “Tax Matters Agreement”) (collectively, the “Indemnification Agreements”) are further described below. Reimbursement Agreement In connection with the Spin-Off, the Company entered into the Reimbursement Agreement pursuant to which the Company has an obligation to make cash payments to Honeywell in amounts equal to 90 % of payments for certain Honeywell environmental-liability payments, which include amounts billed (“payments”), less 90 % of Honeywell’s net insurance receipts relating to such liabilities, and less 90 % of the net proceeds received by Honeywell in connection with (i) affirmative claims relating to such liabilities, (ii) contributions by other parties relating to such liabilities and (iii) certain property sales (the “recoveries”). The amount payable by the Company in respect of such liabilities arising in respect of any given year is subject to a cap of $ 140 million. Payments in respect of the liabilities arising in a given year will be made quarterly throughout such year on the basis of an estimate of the liabilities and recoveries provided by Honeywell. Following the end of any such year, Honeywell will provide the Company with a calculation of the amount of payments and the recoveries actually received. Payment amounts under the Reimbursement Agreement will be deferred to the extent that a specified event of default has occurred and is continuing under certain indebtedness, including under the A&R Credit Agreement, or the payment thereof causes the Company to not be compliant with certain financial covenants in certain indebtedness, including the Company’s A&R Credit Agreement on a pro forma basis, including the maximum total leverage ratio (ratio of consolidated debt to consolidated EBITDA, which excludes any amounts owed to Honeywell under the Reimbursement Agreement), and the minimum interest coverage ratio. The obligations under the Reimbursement Agreement will continue until the earlier of: (1) December 31, 2043; or (2) December 31 of the third consecutive year during which the annual reimbursement obligation (including in respect of deferred payment amounts) has been less than $ 25 million. In 2021 and 2020, the Company and Honeywell entered into several amendments to the Reimbursement Agreement. These amendments included modifications of certain covenants in Exhibit G to conform to the amended covenants included in the Credit Agreement First Amendment, deferment of certain payments under the Reimbursement Agreement to later in the year, and amendment of Exhibit G to, among other things, permit sale and leaseback transaction. An aggregate amount of up to $ 150 million would be permitted thereunder so long as the same conditions that are applicable under the Credit Agreement are satisfied. On February 12, 2021 the covenants in Exhibit G of the Reimbursement Agreement were amended and restated in their entirety to substantially conform to the affirmative and negative covenants contained in the A&R Credit Agreement. The following table summarizes information concerning the Company’s Reimbursement Agreement liabilities: Years Ended December 31, 2021 2020 2019 Beginning balance $ 591 $ 585 $ 616 Accruals for indemnification liabilities deemed probable and reasonably estimable 146 146 179 Reduction (1) - - ( 71 ) Indemnification payment ( 140 ) ( 140 ) ( 139 ) Ending balance (2) $ 597 $ 591 $ 585 (1) Reduction in indemnification liabilities relates to a provision in the Reimbursement Agreement that reduces the obligation due to Honeywell for any proceeds received by Honeywell from a property sale of a site under the agreement. (2) Reimbursement Agreement liabilities deemed probable and reasonably estimable, however, it is possible the Company could pay $ 140 million per year (exclusive of any late payment fees up to 5 % per annum) until the earlier of (1) December 31, 2043; or (2) December 31 of the third consecutive year during which the annual reimbursement obligation (including in respect of deferred payment amounts) has been less than $ 25 million. Reimbursement Agreement liabilities are included in the following balance sheet accounts: Years Ended December 31, 2021 2020 Accrued liabilities $ 140 $ 140 Obligations payable under Indemnification Agreements 457 451 $ 597 $ 591 The Company does not currently possess sufficient information to reasonably estimate the amounts of indemnification liabilities to be recorded upon future completion of studies, litigation or settlements, and neither the timing nor the amount of the ultimate costs associated with such indemnification liability payments can be determined although they could be material to the Company’s consolidated results of operations and operating cash flows in the periods recognized or paid. Independent of the Company’s payments under the Reimbursement Agreement, the Company will have ongoing liability for certain environmental claims which are part of the Company’s going forward business. Tax Matters Agreement In connection with the Spin-Off, the Company entered into the Tax Matters Agreement with Honeywell pursuant to which it is responsible and will indemnify Honeywell for certain taxes, including certain income taxes, sales taxes, VAT and payroll taxes, relating to the business for all periods, including periods prior to the consummation of the Spin-Off. In addition, the Tax Matters Agreement addresses the allocation of liability for taxes that are incurred as a result of restructuring activities undertaken to effectuate the Spin-Off. The Company is required to indemnify Honeywell for any taxes resulting from the failure of the Spin-Off and related internal transactions to qualify for their intended tax treatment under U.S. federal, state and local income tax law, as well as foreign tax law, where such taxes result from action or omission of the Company not permitted by the Separation and Distribution Agreement or the Tax Matters Agreement. As of December 31, 2021, and 2020, the Company had an indemnity liability owed to Honeywell for future tax payments of $ 128 million and $ 139 million, respectively, which is included in Obligations payable under Indemnification Agreements. Trademark Agreement The Company and Honeywell entered into a 40 -year Trademark License Agreement (the “Trademark Agreement”) that authorizes the Company’s use of certain licensed trademarks in the operation of Resideo’s business for the advertising, sale and distribution of certain licensed products. In exchange, the Company will pay a royalty fee of 1.5 % on net revenue to Honeywell related to such licensed products which is recorded in Selling, general and administrative expense on the Consolidated Statements of Operations. For the years ended December 31, 2021, 2020, and 2019, royalty fees were $ 21 million, $ 26 million, and $ 27 million, respectively. Other Matters The Company is subject to lawsuits, investigations, and disputes arising out of the conduct of its business, including matters relating to commercial transactions, government contracts, product liability, prior acquisitions and divestitures, employee matters, intellectual property, and environmental, health, and safety matters. The Company recognizes a liability for any contingency that is probable of occurrence and reasonably estimable. The Company continually assesses the likelihood of adverse judgments or outcomes in these matters, as well as potential ranges of possible losses (taking into consideration any insurance recoveries), based on a careful analysis of each matter with the assistance of outside legal counsel and, if applicable, other experts. No such matters are material to the Company's unaudited financial statements. The Company, the Company’s former CEO Michael Nefkens, the Company’s former CFO Joseph Ragan, and the Company’s former CIO Niccolo de Masi are named defendants of a class action securities suit in the U.S. District Court for the District of Minnesota styled In re Resideo Technologies, Inc. Securities Litigation, 19-cv-02863 (the “Securities Litigation”). The complaint, as amended, asserts claims under Section 10(b) and Section 20(a) of the Securities Exchange Act of 1934, broadly alleging, among other things, that the defendants (or some of them) made false and misleading statements regarding, among other things, Resideo’s business, performance, the efficiency of its supply chain, operational and administrative issues resulting from the spin-off from Honeywell, certain business initiatives, and financial guidance in 2019. On July 30, 2021, the Company executed a term sheet with plaintiffs’ representatives setting forth an agreement in principle to settle the claims alleged in the complaint, as amended. The total amount to be paid in settlement of the claims as set forth in the agreement in principle is $ 55 million. Insurance recoveries of approximately $ 39 million are expected related to the settlement. The claim settlement payment and related insurance recoveries have been paid to an escrow account pending final court approval of the Securities Litigation. On August 18, 2021, the Company and plaintiffs’ representative executed a definitive Stipulation and Agreement of Settlement reflecting the terms of the agreement in principle and other customary terms and conditions (the “Settlement”), including court approval of the Settlement. No objections to the Settlement were filed with the court. On January 27, 2022, the court held a final hearing to consider whether the Settlement is fair, reasonable, and in the best interests of the Settlement class and took a motion for approval of the Settlement under advisement. The Company intends to vigorously pursue approval of the Settlement, but there can be no assurance that court approval will be granted. Certain current or former directors and officers of the Company were defendants in a consolidated derivative action in the District Court for the District of Delaware under the caption In re Resideo Technologies, Inc. Derivative Litigation, 20-cv-00915 (the “Federal Derivative Action”). On September 21, 2021, the parties filed a stipulation requesting that the Federal Derivative Action be transferred to the District of Minnesota, where Securities Litigation is pending. The court ordered the transfer of the Federal Derivative Action on September 23, 2021. On September 1, 2021, an additional shareholder derivative complaint was filed by Riviera Beach, part of the leadership group in the Federal Derivative Action, and City of Hialeah Employees Retirement System against certain current or former directors and officers of the Company in the District of Minnesota, alleging substantially that the same facts and making substantially the same claims against the same defendants as in the Federal Derivative Action, and additionally referencing board materials obtained through a demand made pursuant to Section 220 of the Delaware Code Title 8 (the “Riviera Beach Action”). On December 1, 2021, the Federal Derivative Action and the Riviera Beach Action were consolidated into a single action under the caption: In re Resideo Technologies, Inc. Derivative Litigation, 21-cv-01965 (the “Consolidated Federal Derivative Action”). The Consolidated Federal Derivative Action is currently stayed pending entry of a final judgement in the Securities Litigation. On June 25, 2021, the Bud & Sue Frashier Family Trust U/A DTD 05/05/98, filed a shareholder derivative complaint against certain current or former directors and officers of the Company in the Court of Chancery of the State of Delaware, captioned Bud & Sue Frashier Trust U/A DTD 05/05/98 v. Fradin , 2021-0556 (“Delaware Chancery Derivative Action”). The Delaware Chancery Derivative Action alleges substantially the same facts and makes substantially the same claims as the Federal Derivative Action, and additionally references board materials obtained through a demand made pursuant to Section 220 of the Delaware Code Title 8. The Delaware Chancery Derivative Action remains stayed by agreement of the parties. The Company intends to defend this action vigorously, but there can be no assurance that the defense will be successful. Warranties and Guarantees In the normal course of business, the Company issues product warranties and product performance guarantees. It accrues for the estimated cost of product warranties and product performance guarantees based on contract terms and historical experience at the time of sale. Adjustments to initial obligations for warranties and guarantees are made as changes to the obligations become reasonably estimable. Product warranties and product performance guarantees are included in Accrued liabilities. The following table summarizes information concerning recorded obligations for product warranties and product performance guarantees. Years Ended December 31, 2021 2020 2019 Beginning balance $ 22 $ 25 $ 26 Accruals for warranties/guarantees issued during the year 22 21 15 Adjustment of pre-existing warranties/guarantees ( 3 ) ( 7 ) - Settlement of warranty/guarantee claims ( 18 ) ( 17 ) ( 16 ) Ending balance $ 23 $ 22 $ 25 Purchase Commitments The Company’s unconditional purchase obligations include purchase commitments with suppliers and other obligations entered in to during the normal course of business regarding the purchase of goods and services. As of December 31, 2021 , the Company’s estimated minimum obligations associated with unconditional purchase obligations, which are not recognized in the Company’s Consolidated Balance Sheet, were $ 34 million in 2022, $ 34 million in 2023, $ 31 million in 2024 and $ 2 million in 2025. For the years ended December 31, 2021, 2020, and 2019 , purchases related to these obligations were $ 22 million, $ 22 million and $ 24 million, respectively. |
Pension
Pension | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Pension | Note 21. Pension The Company sponsors multiple funded and unfunded U.S. and non-U.S. defined benefit pension plans. Pension benefits for many of its U.S. employees are provided through non-contributory, qualified and non-qualified defined benefit plans. It also sponsors defined benefit pension plans which cover non-U.S. employees who are not U.S. citizens, in certain jurisdictions, principally Germany, Austria, Belgium, France, India, Switzerland, and the Netherlands. The following tables summarize the balance sheet impact, including the benefit obligations, assets and funded status associated with the pension plans. U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Change in benefit obligation: Benefit obligation at beginning of year $ 374 $ 344 $ 286 $ 161 $ 137 $ 93 Service cost 7 7 5 7 7 5 Interest cost 10 11 13 1 1 2 Actuarial (gains) losses ( 20 ) 38 51 ( 18 ) 6 27 Net benefits paid ( 5 ) ( 4 ) ( 13 ) - - - Settlements ( 18 ) ( 22 ) - ( 1 ) ( 6 ) ( 3 ) Other - - 2 1 2 13 Exchange rate adjustments - - - ( 10 ) 14 - Benefit obligation at end of year 348 374 344 141 161 137 Change in plan assets: Fair value of plan assets at beginning of year 340 331 274 28 27 20 Actual return on plan assets 25 35 70 2 - 2 Contributions - 1 - 3 2 2 Net benefits paid ( 5 ) ( 4 ) ( 13 ) 1 - 1 Settlements ( 18 ) ( 22 ) - ( 1 ) ( 6 ) ( 3 ) Other - ( 1 ) - - 3 5 Exchange rate adjustments - - - ( 1 ) 2 - Fair value of plan assets at end of year 342 340 331 32 28 27 Funded status of plans (non-current) $ ( 6 ) $ ( 34 ) $ ( 13 ) $ ( 109 ) $ ( 133 ) $ ( 110 ) The benefit obligation generated a global net actuarial gain of $ 38 million for the year ended December 31, 2021 . A global increase in discount rates over the course of the year was the main driver, generating a total gain of $ 34 million across all plans. In addition, experience gains amounted to $ 6 million globally, ($ 2 million U.S. and $ 4 million Non-U.S.) and demographic assumptions gains were $ 3 million (driven primarily by the introduction of new demographic tables in Switzerland). These gains were partially offset by losses on other financial assumptions of approximately $ 5 million, primarily as a result of higher pension increase assumption in Germany. Actual return on plan assets for the year ended December 31, 2021 was higher than expected driven by return-seeking asset performance exceeding expectations leading to an additional asset gain of $ 9 million globally, for a total asset return of $ 27 million globally. Amounts recognized in Accumulated other comprehensive (loss) associated with pension plans at December 31, 2021 and 2020 are as follows: U.S. Plans Non-U.S. Plans 2021 2020 2021 2020 Prior service credit $ ( 2 ) $ ( 2 ) $ - $ - Net actuarial loss (gain) 2 30 ( 2 ) 14 Net amount recognized $ - $ 28 $ ( 2 ) $ 14 The components of net periodic benefit cost and other amounts recognized in Comprehensive income for pension plans include the following components: U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Net Periodic Benefit Cost Service cost $ 7 $ 7 $ 5 $ 7 $ 7 $ 5 Interest cost 10 11 13 1 1 2 Expected return on plan assets ( 16 ) ( 17 ) ( 16 ) ( 1 ) ( 1 ) ( 1 ) Amortization of prior service credit ( 1 ) ( 1 ) ( 1 ) - - - Mark to market adjustment - - 1 ( 3 ) 6 16 Other - 3 - - - 2 Net periodic benefit cost $ - $ 3 $ 2 $ 4 $ 13 $ 24 The components of net periodic benefit cost other than the service cost are included in Other expense, net in the Consolidated Statements of Operations for the years ended December 31, 2021, 2020 and 2019. U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Other Changes in Plan Assets and Benefits Obligations Recognized in Other Comprehensive Loss (Income) Actuarial (gains) losses $ ( 20 ) $ 38 $ 51 $ ( 18 ) $ 6 $ 26 Excess return on plan assets (1) ( 9 ) ( 17 ) ( 54 ) - - ( 1 ) Actuarial gains recognized during the year - ( 2 ) - 3 ( 6 ) ( 17 ) Other 1 - - ( 1 ) 1 - Total recognized in other comprehensive loss (income) $ ( 28 ) $ 19 $ ( 3 ) $ ( 16 ) $ 1 $ 8 Total recognized in net periodic benefit cost and other comprehensive loss (income) $ ( 28 ) $ 22 $ ( 1 ) $ ( 12 ) $ 14 $ 32 (1) Represents actual return on plan assets in excess of the expected return. Significant actuarial assumptions used in determining the benefit obligations and net periodic benefit (income) cost for benefit plans are presented in the following table as weighted averages. U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Actuarial assumptions used to determine benefit obligations as of December 31: Discount rate 3.0 % 2.7 % 3.3 % 1.2 % 0.7 % 1.1 % Interest crediting rate 6.0 % 6.0 % 6.0 % 1.5 % 1.5 % 1.5 % Expected annual rate of compensation increase 3.2 % 3.5 % 3.4 % 2.4 % 2.4 % 2.4 % Actuarial assumptions used to determine net periodic benefit cost for the year ended December 31: Discount rate - benefit obligation 2.7 % 3.3 % 4.5 % 0.7 % 1.1 % 2.0 % Interest crediting rate 6.0 % 6.0 % 6.0 % 1.5 % 1.5 % 1.5 % Expected rate of return on plan assets 4.7 % 5.4 % 5.7 % 2.3 % 2.7 % 2.8 % Expected annual rate of compensation increase 3.5 % 3.4 % 3.4 % 2.4 % 2.4 % 2.4 % The discount rate for the U.S. pension plans reflects the current rate at which the associated liabilities could be settled at the measurement date of December 31. To determine discount rates for the U.S. pension plans, the Company uses a modeling process that involves matching the expected cash outflows of its benefit plans to a yield curve constructed from a portfolio of high-quality, fixed income debt instruments. The Company uses the single weighted-average yield of this hypothetical portfolio as a discount rate benchmark. The expected rate of return on U.S. plan assets of 4.7 % is a long-term rate based on historical plan asset returns over varying long-term periods combined with current market conditions and broad asset mix considerations. The Company reviews the expected rate of return on an annual basis and revises it as appropriate. For non-U.S. benefit plans, actuarial assumptions reflect economic and market factors relevant to each country. The following amounts relate to pension plans with accumulated benefit obligations exceeding the fair value of plan assets. December 31, U.S. Plans Non-U.S. Plans 2021 2020 2021 2020 Projected benefit obligation $ 3 $ 374 $ 139 $ 161 Accumulated benefit obligation $ 2 $ 358 $ 124 $ 139 Fair value of plan assets $ - $ 340 $ 31 $ 28 The following amounts relate to pension plans with projected benefit obligations exceeding the fair value of the plan assets. December 31, U.S. Plans Non-U.S. Plans 2021 2020 2021 2020 Projected benefit obligation $ 348 $ 374 $ 141 $ 161 Accumulated benefit obligation $ 337 $ 358 $ 125 $ 139 Fair value of plan assets $ 342 $ 340 $ 32 $ 28 The Company utilized a third-party investment management firm to serve as its Outsourced Chief Investment Officer; however, the Company has appointed an internal fiduciary committee that monitors adherence to the investment guidelines the firm will follow. The Company employs an investment approach whereby a mix of equities and fixed income investments are used to maximize the long-term return of plan assets for a prudent level of risk. Risk tolerance is established through careful consideration of plan liabilities and plan funded status. The investment portfolio contains a diversified blend of equity and fixed income investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks, as well as growth, value and small and large capitalizations. Other assets such as real estate and hedge funds may be used to improve portfolio diversification. The non-U.S. investment policies are different for each country as local regulations, funding requirements, and financial and tax considerations are part of the funding and investment allocation process in each country. A majority of the U.S. pension plan assets as of December 31, 2021 do not have published pricing and are valued using Net Asset Value (“NAV”) which approximates fair value. NAV by asset category and fair value by asset category are as follows for December 31, 2021 and 2020: U.S. Plans December 31, 2021 December 31, 2020 Total NAV Total NAV Level 1 Cash and cash equivalents $ 4 $ 4 $ 6 $ 1 $ 5 Equity 95 95 105 105 - Investment funds 16 16 14 14 - U.S. treasury obligations - - 16 16 - Government bonds 39 39 41 41 - Corporate bonds 153 153 126 126 - Real estate / property 35 35 32 32 - Total assets at fair value $ 342 $ 342 $ 340 $ 335 $ 5 The fair values of the non-U.S. pension plan assets as by asset category are as follows: Non-U.S. Plans December 31, 2021 December 31, 2020 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Equity $ 1 $ 1 $ - $ - $ 1 $ 1 $ - $ - Government bonds 1 - 1 - 1 - 1 - Insurance contracts 10 - - 10 10 - - 10 Other 20 - - 20 16 - - 16 Total assets at fair value $ 32 $ 1 $ 1 $ 30 $ 28 $ 1 $ 1 $ 26 5 The following table summarizes changes in the fair value of Level 3 assets for Non-U.S. plans: Non-U.S. Plans Balance at December 31, 2018 $ 6 Return on plan assets 2 Purchases, sales and settlements, net 15 Other 1 Balance at December 31, 2019 24 Return on plan assets - Purchases, sales and settlements, net ( 1 ) Other 3 Balance at December 31, 2020 26 Return on plan assets 1 Purchases, sales and settlements, net 4 Other ( 1 ) Balance at December 31, 2021 $ 30 Corporate Bonds and Government Bonds held as of December 31, 2021 and 2020 are valued either by using pricing models, bids provided by brokers or dealers, quoted prices of securities with similar characteristics or discounted cash flows and as such include adjustments for certain risks that may not be observable such as credit and liquidity risks. Other investments as of December 31, 2021 and 2020 and Insurance Contracts are classified as Level 3 as there are neither quoted prices nor other observable inputs for pricing. Insurance Contracts are issued by insurance companies and are valued at cash surrender value, which approximates the contract fair value. Other investments consist of a collective pension foundation that is valued and allocated by the plan administrator. The Company utilizes the services of retirement and investment consultants to actively manage the assets of the Company’s pension plans. The Company has established asset allocation targets and investment guidelines based on the guidance of the consultants. The Company’s target allocations are 54 % fixed income investments, 28 % global equity investments, 9 % global real estate investments and 9 % cash and other investments. The Company’s general funding policy for qualified defined benefit pension plans is to contribute amounts at least sufficient to satisfy regulatory funding standards. In 2021, it was not required to make contributions to the U.S. pension plans, and no contributions were made. There is no requirement to make any contributions to the U.S. pension plans in 2022. In 2021, contributions of $ 3 million were made to the non-U.S. pension plans to satisfy regulatory funding requirements. In 2022, the Company expects to make contributions of cash and/or marketable securities of approximately $ 3 million to the non-U.S. pension plans to satisfy regulatory funding standards. Contributions for both the U.S. and non-U.S. pension plans do not reflect benefits paid directly from Company assets. Benefit payments, including amounts to be paid from Company assets, and reflecting expected future service, as appropriate, are expected to be paid as follows: U.S. Plans Non-U.S. Plans 2022 $ 15 $ 3 2023 $ 15 $ 2 2024 $ 16 $ 3 2025 $ 17 $ 3 2026 $ 18 $ 3 2027-2031 $ 96 $ 23 |
Geographic Areas - Financial Da
Geographic Areas - Financial Data | 12 Months Ended |
Dec. 31, 2021 | |
Segments, Geographical Areas [Abstract] | |
Geographic Areas - Financial Data | Note 22. Geographic Areas—Financial Data Net Revenue (1) Long-lived Assets (2) 2021 2020 2019 2021 2020 2019 United States $ 4,181 $ 3,543 $ 3,423 $ 244 $ 260 $ 272 Europe 1,196 1,121 1,117 139 144 136 Other International 469 407 448 46 47 45 $ 5,846 $ 5,071 $ 4,988 $ 429 $ 451 $ 453 (1) Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. (2) Long-lived assets are comprised of Property, plant and equipment – net and lease right-of-use assets. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note. 23 Subsequent Events On February 6, 2022 , the Company entered into an Equity Purchase Agreement providing for the Company to purchase 100 % of the issued and outstanding capital stock of First Alert, Inc. (“First Alert”). First Alert and its subsidiaries offer a comprehensive portfolio of detection and suppression devices, including smoke alarms, carbon monoxide alarms, combination alarms, connected fire and carbon monoxide devices, and fire extinguishers and other suppression solutions, including through the First Alert ® , BRK ® and Onelink ® brands. The base purchase price payable by the Company upon closing of the acquisition of First Alert is $ 593 million. The Company expects to fund the acquisition, through a combination of cash on hand, and incremental borrowings under a term loan facility. The transaction is anticipated to be completed in the first quarter of 2022, and is subject to customary closing conditions, including receipt of applicable regulatory approvals. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Accounting Principles | Accounting Principles —The financial statements and accompanying notes are prepared in accordance with U.S. GAAP. The following is a description of Resideo’s significant accounting policies. |
Principles of Consolidation | Principles of Consolidation —The Consolidated Financial Statements include the accounts of Resideo Technologies, Inc. and all of its subsidiaries in which a controlling interest is maintained. All intercompany transactions and balances are eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents —Cash and cash equivalents include cash on hand and highly liquid investments having an original maturity of three months or less. |
Accounts Receivables and Allowance for Doubtful Accounts | Accounts Receivables and Allowance for Doubtful Accounts —Trade accounts receivable are recorded at the invoiced amount as a result of transactions with customers. The Company maintains allowances for doubtful accounts for estimated losses as a result of customers’ inability to make required payments. The Company estimates anticipated losses from doubtful accounts based on days past due as measured from the contractual due date and historical collection history. The Company also takes into consideration changes in economic conditions that may not be reflected in historical trends, for example customers in bankruptcy, liquidation or reorganization. Receivables are written-off against the allowance for doubtful accounts when they are determined to be uncollectible. Such determination includes analysis and consideration of the particular conditions of the account, including time intervals since last collection, customer performance against agreed upon payment plans, solvency of customer and any bankruptcy proceedings. |
Inventories | Inventories —Inventories in the Products & Solutions business are stated at the lower of cost or net realizable value, determined on a first-in, first-out basis, including direct material costs and direct and indirect manufacturing costs, or net realizable value. Inventories in the ADI Global Distribution business are stated at average cost. Reserves are maintained for obsolete and surplus items. |
Property, Plant and Equipment | Property, Plant and Equipment —Property, plant and equipment are recorded at cost, less accumulated depreciation. For financial reporting, the straight-line method of depreciation is used over the estimated useful lives of 10 to 50 years for buildings and improvements, 3 to 16 years for machinery and equipment and 3 to 10 years for tooling equipment. |
Goodwill | Goodwill —The Company performs goodwill impairment testing annually, on the first day of the fourth quarter each year or more frequently if indicators of potential impairment exist. The goodwill impairment test is performed at the reporting unit level. The Company has two reporting units, Products & Solutions and ADI Global Distribution. The Company performs its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value provided the loss recognized does not exceed the total amount of goodwill allocated to that reporting unit. Determining the fair value of a reporting unit involves the use of significant estimates and assumptions. For the 2021 annual impairment test, the Company used a weighting of fair values derived from the income approach and market approach. Under the income approach, the Company calculates the fair value of a reporting unit based on the present value of estimated future cash flows. The income approach requires the exercise of significant judgment, including judgment about the amount and timing of expected future cash flows, assumed terminal value, and appropriate discount rates. Under the market approach, the Company utilizes the public company guideline method. The Company believes the estimates and assumptions used in the calculations are reasonable. In addition, the extent to which COVID-19 may adversely impact the Company’s business depends on future developments, which are uncertain and unpredictable, depending upon severity and duration of the outbreak, and the effectiveness of actions taken globally to contain or mitigate its effects. Any resulting financial impact cannot be estimated reasonably at this time but may adversely affect the Company’s business and financial results. It is possible that into 2022, macroeconomic conditions may have unexpected impacts on the Company’s business. If there were an adverse change in facts and circumstances, then an impairment charge may be necessary in the future. Should the fair value of the Company’s reporting units fall below its carrying amount because of reduced operating performance, market declines, changes in the discount rate, or other conditions, charges for impairment may be necessary. The Company monitors its reporting units to determine if there is an indicator of potential impairment. |
Other Intangible Assets and Long-lived Assets | Other Intangible Assets and Long-lived Assets —Other intangible assets with determinable lives consist of customer lists, technology, patents and trademarks and software intangibles and are amortized over their estimated useful lives, ranging from 3 to 15 years. They are reviewed for impairment whenever events or circumstances indicate that the carrying amount of the assets may not be recoverable. Recoverability of long-lived assets are measured by comparison of the carrying amount of the asset to the future undiscounted cash flows the asset is expected to generate. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. |
Warranties and Guarantees | Warranties and Guarantees —Expected warranty costs for products sold are recognized based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, length of the warranty and various other considerations. Costs of product recalls, which may include the cost of the product being replaced as well as the customer’s cost of the recall, including labor to remove and replace the recalled part, are accrued as part of the warranty accrual at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. |
Leases | Leases —Effective January 1, 2019, arrangements containing leases are evaluated as an operating or finance lease at lease inception. For operating leases, the Company recognizes an operating right-of-use asset and operating lease liability at lease commencement based on the present value of lease payments over the lease term. Since an implicit rate of return is not readily determinable for the Company’s leases, an incremental borrowing rate is used in determining the present value of lease payments and is calculated based on information available at the lease commencement date. The incremental borrowing rate is determined using a portfolio approach based on the rate of interest the Company would have to pay to borrow funds on a collateralized basis over a similar term. The Company references a market yield curve consistent with the Company’s credit rating which is risk-adjusted to approximate a collateralized rate in the currency of the lease. These rates are updated on a quarterly basis for measurement of new lease obligations. Most leases include renewal options; however, generally it is not reasonably certain that these options will be exercised at lease commencement. Lease expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recognized on the Company’s balance sheet. The Company does not separate lease and non-lease components for its real estate and automobile leases. |
Revenue Recognition | Revenue Recognition —Product and service revenues are recognized when or as the Company transfers control of the promised products or services to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. In the sale of products, the terms of a contract or the historical business practice can give rise to variable consideration due to, but not limited to, discounts and rebates. The Company estimates variable consideration at the most likely amount that will be received from customers and reduces revenues recognized accordingly. The Company includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information (historical, current and forecasted) that is reasonably available to the Company. Sales, use and value added taxes collected by the Company and remitted to various government authorities were not recognized as revenues and are reported on a net basis. Shipping and handling fees billed to customers were included in Cost of goods sold. |
Royalty | Royalty —In connection with the Spin-Off, the Company and Honeywell entered into a 40 -year Trademark License Agreement (“the Trademark Agreement”) that authorizes the Company’s use of certain licensed trademarks in the operation of Resideo’s business for the advertising, sale and distribution of certain licensed products. In exchange, the Company pays a royalty fee of 1.5 % of net revenue of the licensed products to Honeywell which is recorded in Selling, general and administrative expense on the Consolidated Statements of Operations. |
Reimbursement Agreement | Reimbursement Agreement —In connection with the Spin-Off the Company entered into an Indemnification and Reimbursement Agreement with Honeywell (the “Reimbursement Agreement”), pursuant to which it has an obligation to make cash payments to Honeywell in amounts equal to 90 % of payments, which include amounts billed, with respect to certain environmental claims, remediation and, to the extent arising after the Spin-Off, hazardous exposure or toxic tort claims, in each case, including consequential damages (the “liabilities”) in respect of specified Honeywell properties contaminated through historical business operations prior to the Spin-Off (“Honeywell Sites”), including the legal and other costs of defending and resolving such liabilities, less 90 % of Honeywell’s net insurance receipts relating to such liabilities, and less 90 % of the net proceeds received by Honeywell in connection with (i) affirmative claims relating to such liabilities, (ii) contributions by other parties relating to such liabilities and (iii) certain property sales. The amount payable in respect of such liabilities arising in any given year is subject to a cap of $ 140 million. Reimbursement Agreement expenses are presented within Other expense, net in the Consolidated Statements of Operations and within Accrued liabilities and Obligations payable under Indemnification Agreements in the Consolidated Balance Sheets. For additional information, see Note 17. Commitments and Contingencies. |
Environmental | Environmental —The Company accrues costs related to environmental matters when it is probable that it has incurred a liability related to a contaminated site and the amount can be reasonably estimated. Environmental costs for the Company’s owned sites are presented within Cost of goods sold for operating sites. For additional information, see Note 17. Commitments and Contingencies. |
Tax Indemnification Agreement | Tax Indemnification Agreement —The Tax Matters Agreement provides that Resideo is required to indemnify Honeywell for any taxes (and reasonable expenses) resulting from the failure of the Spin-Off and related internal transactions to qualify for their intended tax treatment under U.S. federal, state and local income tax law, as well as foreign tax law, where such taxes result from (a) breaches of covenants and representations the Company makes and agrees to in connection with the Spin-Off, (b) the application of certain provisions of U.S. federal income tax law to these transactions or (c) any other action taken or omission made (other than actions expressly required or permitted by the Separation and Distribution Agreement, the Tax Matters Agreement or other ancillary agreements) after the consummation of the Spin-Off that gives rise to these taxes. As of December 31, 2021 and December 31, 2020 the Company had an indemnity outstanding to Honeywell for past and potential future tax payments of $ 128 million and $ 139 million, respectively. See Note 17. Commitments and Contingencies. |
Research and Development | Research and Development —The Company conducts research and development activities, which consist primarily of the development of new products as well as enhancements and improvements to existing products that substantially change the product. Research and development costs primarily relate to employee compensation and consulting fees which are charged to expense as incurred. |
Advertising Costs | Advertising Costs— The Company expenses advertising costs as incurred. Advertising costs totaled $ 22 million, $ 25 million and $ 46 million for the years ended December 31, 2021, 2020 and 2019 , respectively. |
Defined Contribution Plans | Defined Contribution Plans— The Company sponsors various defined contribution plans with varying terms depending on the country of employment. For the years ended December 31, 2021, 2020 and 2019 the Company recognized compensation expense related to the defined contribution plans of $ 19 million, $ 18 million, and $ 18 million, respectively. |
Stock-Based Compensation Plans | Stock-Based Compensation Plans —The principal awards issued under Resideo’s stock-based compensation plans, which are described in Note 5. Stock-Based Compensation Plans, are restricted stock units. The cost for such awards is measured at the grant date based on the fair value of the award. Some awards are issued with a market condition which are valued on the grant date utilizing a Monte Carlo simulation model. Stock options are also issued under Resideo’s stock-based compensation plans and are valued on the grant date using the Black-Scholes option pricing model. The Black-Scholes option pricing model and the Monte Carlo simulation model require estimates of future stock price volatility, expected term, risk-free interest rate and forfeitures. For all stock-based compensation, the fair value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods (generally the vesting period of the equity award) and is included in Selling, general and administrative expenses in the Consolidated Statements of Operations. Forfeitures are estimated at the time of grant to recognize expense for those awards that are expected to vest and are based on historical forfeiture rates. |
Pension | Pension — The Company disaggregates the service cost component of net benefit costs and reports those costs in the same line item or items in the Consolidated Statements of Operations as other compensation costs arising from services rendered by the pertinent employees during the period. The other non-service components of net benefit costs are required to be presented separately from the service cost component and outside of income from operations. The Company has recorded the service cost component of pension expense in Costs of goods sold and Selling, general and administrative expenses based on the classification of the employees it relates to. The remaining components of net benefit costs within pension expense, primarily interest costs and expected return on plan assets, are recorded in Other expense, net. The Company recognizes net actuarial gains or losses in excess of 10 % of the greater of the fair value of plan assets or the plans’ projected benefit obligation (the corridor) annually in the fourth quarter each year. This adjustment known as the mark to market adjustment is reported in Other expense, net. |
Foreign Currency Translation | Foreign Currency Translation —Assets and liabilities of operations outside the United States with a functional currency other than U.S. Dollars are translated into U.S. Dollars using year-end exchange rates. Revenue, costs and expenses are translated at the average exchange rates in effect during the year. Foreign currency translation gains and losses are included as a component of Accumulated other comprehensive loss. |
Income Taxes | Income Taxes —Significant judgment is required in evaluating tax positions. The Company establishes additional reserves for income taxes when, despite the belief that tax positions are fully supportable, there remain certain positions that do not meet the minimum recognition threshold. The approach for evaluating certain and uncertain tax positions is defined by the authoritative guidance which determines when a tax position is more likely than not to be sustained upon examination by the applicable taxing authority. In the normal course of business, the Company and its subsidiaries are examined by various federal, state and foreign tax authorities. The Company regularly assesses the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of its provision for income taxes. The Company continually assesses the likelihood and amount of potential adjustments and adjusts the income tax provision, the current tax liability and deferred taxes in the period in which the facts that give rise to a change in estimate become known. |
Earnings Per Share | Earnings Per Share —Basic earnings per share is based on the weighted average number of common shares outstanding. Diluted earnings per share is based on the weighted average number of common shares outstanding and all dilutive potential common shares outstanding. For additional information, see Note 10. Earnings Per Share. |
Use of Estimates | Use of Estimates —The preparation of the Company’s Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the Consolidated Financial Statements and related disclosures in the accompanying notes. Actual results could differ from those estimates. Estimates and assumptions are periodically reviewed, and the effects of changes are reflected in the Consolidated Financial Statements in the period they are determined to be necessary. Estimates are used when accounting for stock-based compensation, pension benefits, indemnification liabilities, goodwill and intangible assets, and valuation allowances for accounts receivable, inventory, deferred tax assets, and the amounts of revenue and expenses reported during the period. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements —The Company considers the applicability and impact of all recent accounting standards updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”). ASUs not listed below were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s consolidated financial position or results of operations. In August 2018, the FASB issued ASU No. 2018-14, Compensation — Retirement Benefits — Defined Benefit Plans — General (Topic 715-20): Disclosure Framework — Changes to the Disclosure Requirements for Defined Benefit Plans , which amends the current disclosure requirements regarding defined benefit pensions and other post retirement plans and allows for the removal of certain disclosures, while adding certain new disclosure requirements. The Company adopted the standard effective January 1, 2020 and the adoption did not have a material financial statement impact. In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) . This ASU simplifies the accounting for income taxes by, among other things, eliminating certain existing exceptions related to the general approach in ASC 740 relating to franchise taxes, reducing complexity in the interim-period accounting for year-to-date loss limitations and changes in tax laws, and clarifying the accounting for transactions outside of business combinations that result in a step-up in the tax basis of goodwill. The Company early adopted the provisions of this guidance on January 1, 2020. Adoption of this guidance did not have a material financial statement impact. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which is optional guidance related to reference rate reform that provides practical expedients for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. This guidance along with its subsequent clarifications, is effective from March 12, 2020 through December 31, 2022 and is applicable for the Company’s A&R Senior Credit Facilities and Swap Agreements, which use LIBOR as a reference rate. The A&R Senior Credit Facilities include a transition clause to a new reference rate in the event LIBOR is discontinued and Swap Agreements will be amended to match the new reference rate. We are currently evaluating the potential impact of adopting this guidance, but do not expect it to have a material impact on our consolidated financial statements. Refer to Note 18. Long-term Debt and Credit Agreement for further details on the Company’s Swap Agreements and A&R Senior Credit Facilities. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregated Revenue | Revenues by geography and business line are as follows for the years ended December 31: Years Ended December 31, 2021 2020 2019 Comfort $ 1,207 $ 1,079 $ 1,103 Security 667 538 520 Residential Thermal Solutions 594 504 552 Products & Solutions 2,468 2,121 2,175 U.S. and Canada 2,814 2,427 2,294 EMEA (1) 523 480 459 APAC (2) 41 43 60 ADI Global Distribution 3,378 2,950 2,813 Net revenue $ 5,846 $ 5,071 $ 4,988 (1) EMEA represents Europe, the Middle East and Africa. (2) APAC represents Asia and Pacific countries. |
Segment Financial Data (Tables)
Segment Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. Years Ended December 31, 2021 2020 2019 Revenue Total Products & Solutions revenue $ 2,841 $ 2,488 $ 2,487 Less: Intersegment revenue 373 367 312 External Products & Solutions revenue 2,468 2,121 2,175 External ADI Global Distribution revenue 3,378 2,950 2,813 Total revenue $ 5,846 $ 5,071 $ 4,988 Years Ended December 31, 2021 2020 2019 Operating profit Products & Solutions $ 541 $ 407 $ 327 ADI Global Distribution 268 194 210 Corporate ( 250 ) ( 290 ) ( 279 ) Total $ 559 $ 311 $ 258 Years Ended December 31, 2021 2020 2019 Depreciation and amortization Products & Solutions $ 65 $ 63 $ 62 ADI Global Distribution 11 12 10 Corporate 12 11 8 Total $ 88 $ 86 $ 80 Years Ended December 31, 2021 2020 2019 Capital expenditures Products & Solutions $ 37 $ 41 $ 71 ADI Global Distribution 24 15 5 Corporate 2 14 19 Total $ 63 $ 70 $ 95 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Compensation Related Costs [Abstract] | |
Summary of Fair Values Estimated for PSUs | The fair values estimated from the Monte Carlo simulation for PSUs issues during the years ended December 31, 2021 and 2020 were calculated using the following assumptions: December 31, 2021 2020 Expected volatility 47.43 % 33.70 % Risk-free interest rate % 0.20 % 0.80 % Expected term (in years) 2.86 2.79 Dividend yield 0 % 0 % |
Summarized RSU and PSU Activity Related to Stock Incentive Plan | The following table summarizes RSU and PSU and activity related to the Stock Incentive Plan during the years ended December 31, 2021, 2020 and 2019: PSUs RSUs Number of Weighted Number of Weighted Non-vested as of January 1, 2019 - $ - 3,338,184 $ 24.05 Granted 322,037 24.32 1,285,167 21.21 Vested - - ( 509,366 ) 23.78 Forfeited ( 45,756 ) 24.39 ( 595,735 ) 24.05 Non-vested as of December 31, 2019 276,281 24.33 3,518,250 23.05 Granted 795,099 6.33 2,262,676 10.55 Vested - - ( 921,060 ) 21.07 Forfeited ( 158,580 ) 16.06 ( 572,902 ) 19.27 Non-vested as of December 31, 2020 912,800 10.09 4,286,964 17.38 Granted 500,227 42.98 1,142,310 27.39 Vested - - ( 1,714,810 ) 19.27 Forfeited ( 95,467 ) 17.20 ( 237,331 ) 20.44 Non-vested as of December 31, 2021 1,317,560 $ 22.06 3,477,133 $ 19.52 |
Summary of Fair Value of Stock Options | The fair value of stock options was calculated using the following assumptions in the Black-Scholes model: December 31, 2021 2020 2019 Expected stock price volatility 34 % 31 % - 37 % 30 % - 32 % Expected term of options 5 years 4.5 years 4.5 years Expected dividend yield — — — Risk-free interest rate 0.77 % 0.25 % - 1.41 % 2.22 % - 2.47 % |
Summary of Stock Option Activity | The following table summarizes stock option activity related to the Stock Incentive Plan during the year ended December 31, 2021: Stock Options Number of Weighted Weighted Aggregate Stock Options outstanding as of January 1, 2019 - $ - - $ - Granted 1,155,566 24.37 Forfeited ( 165,312 ) 24.39 Stock Options outstanding as of December 31, 2019 990,254 24.36 6.0 - Granted 1,083,665 9.17 Forfeited ( 348,696 ) 18.39 Stock Options outstanding as of December 31, 2020 1,725,223 15.98 4.9 12 Granted 150,000 25.48 Forfeited ( 152,831 ) 16.47 Exercised ( 376,424 ) 21.62 3 Stock Options outstanding as of December 31, 2021 1,345,968 15.41 4.9 14 Vested and expected to vest at December 31, 2021 1,165,667 15.52 4.8 12 Exercisable at December 31, 2021 443,956 $ 18.27 4.2 $ 3 |
Summarized Stock-Based Compensation Expense and Related Tax Benefits | The following table summarizes stock-based compensation expense and the related tax benefits under the Company’s plans: Years Ended December 31, 2021 2020 2019 Stock-based compensation expense before income taxes $ 39 $ 29 $ 25 Less: Income tax expense (benefit) ( 3 ) 1 ( 1 ) Stock-based compensation expense, net of income taxes $ 36 $ 30 $ 24 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Schedule of Operating Lease Costs | The Company’s operating lease costs for the years ended December 31, 2021 and 2020 consisted of the following: Years Ended December 31, 2021 2020 2019 Selling, general and administrative expenses $ 46 $ 44 $ 37 Cost of goods sold 17 17 16 Total operating lease costs $ 63 $ 61 $ 53 |
Summary of Lease Recognized Related to Operating Leases | The Company recognized the following related to its operating leases: Financial At December 31, At December 31, Operating right-of-use assets Other assets $ 141 $ 133 Operating lease liabilities - current Accrued liabilities $ 32 $ 33 Operating lease liabilities - non-current Other liabilities $ 120 $ 107 |
Maturities of Operating Lease Liabilities | Maturities of the Company’s operating lease liabilities were as follows: At December 31, 2022 $ 39 2023 35 2024 25 2025 20 2026 17 Thereafter 43 Total lease payments 179 Less: Imputed interest 27 Present value of operating lease liabilities $ 152 Weighted-average remaining lease term (years) 6.04 Weighted-average incremental borrowing rate 5.42 % |
Supplemental Cash Flow Information Related to Operating Leases | Supplemental cash flow information related to the Company’s operating leases was as follows: Years Ended December 31, 2021 2020 2019 Operating cash outflows $ 33 $ 30 $ 35 Operating right-of-use assets obtained in exchange for operating lease liabilities $ 46 $ 26 $ 60 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring Expenses | The Company’s restructuring expenses for 2020 and 2019 are as follows: Years Ended December 31, 2020 2019 Cost of goods sold $ 9 $ 13 Research and development expenses 3 7 Selling, general and administrative expenses 28 17 $ 40 $ 37 |
Summary of Status of Total Restructuring Reserves Related to Severance Cost Included in Accrued Liabilities in the Consolidated Balance Sheets | The following table summarizes the status of total restructuring reserves related to severance cost included in Accrued liabilities in the Consolidated Balance Sheets: Years Ended December 31, 2021 2020 2019 Beginning of year $ 24 $ 19 $ 13 Charges - 40 38 Usage ( 11 ) ( 35 ) ( 31 ) Other ( 4 ) - ( 1 ) End of year $ 9 $ 24 $ 19 |
Other Expense, Net (Tables)
Other Expense, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Summary of Other Expense Net | Years Ended December 31, 2021 2020 2019 Reimbursement Agreement expense $ 146 $ 146 $ 108 Loss on extinguishment of debt 41 - - Other, net ( 29 ) 1 10 $ 158 $ 147 $ 118 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Taxes | Income before taxes Years Ended December 31, 2021 2020 2019 U.S. $ 79 $ ( 93 ) $ ( 83 ) Non-U.S. 274 194 154 $ 353 $ 101 $ 71 |
Schedule of Components of Income Tax Expense (Benefit) | Income tax expense (benefit) Years Ended December 31, 2021 2020 2019 Tax expense (benefit) consists of: Current: U.S. $ 60 $ 21 $ 23 Non-U.S. 45 21 37 $ 105 $ 42 $ 60 Deferred: U.S. $ 5 $ 11 $ ( 11 ) Non-U.S. 1 11 ( 14 ) 6 22 ( 25 ) $ 111 $ 64 $ 35 |
Schedule of Federal Statutory Income Tax Rate Reconciliation with Effective Income Tax Rate | Reconciliation of effective income tax rate Years Ended December 31, 2021 2020 2019 U.S. federal statutory income tax rate 21.0 % 21.0 % 21.0 % Impact of foreign operations ( 0.2 ) ( 5.4 ) ( 10.2 ) U.S. state income taxes 3.6 6.4 6.6 Non-deductible indemnification costs 8.4 29.0 28.0 Executive compensation over $ 1 million 0.9 2.5 0.6 Other non-deductible expenses 0.4 3.7 2.9 U.S. taxation of foreign earnings 1.4 3.5 5.3 Tax credits ( 0.7 ) ( 0.2 ) ( 2.6 ) Change in tax rates ( 1.0 ) 1.3 1.7 All other items – net ( 2.5 ) 1.8 ( 4.7 ) 31.3 % 63.6 % 48.6 % |
Schedule of Deferred Tax Liabilities and Assets | Deferred tax assets (liabilities) Years Ended December 31, 2021 2020 Deferred tax assets: Pension $ 24 $ 37 Other asset basis differences 63 70 Operating lease liabilities 33 34 Accruals and reserves 50 61 Net operating and capital losses 48 47 Other 2 - Gross deferred tax assets 220 249 Valuation allowance ( 63 ) ( 60 ) Total deferred tax assets $ 157 $ 189 Deferred tax liabilities: Other intangible assets $ ( 39 ) $ ( 44 ) Property, plant and equipment ( 23 ) ( 25 ) Operating lease assets ( 33 ) ( 32 ) Other ( 5 ) ( 13 ) Total deferred tax liabilities ( 100 ) ( 114 ) Net deferred tax asset $ 57 $ 75 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share (in millions except shares in thousands and per share data): Years Ended December 31, 2021 2020 2019 Net income $ 242 $ 37 $ 36 Shares used in computing basic earnings per share 144,036 125,348 122,722 Effect of dilutive securities: Dilutive effect of common stock equivalents 4,412 976 516 Shares used in computing diluted earnings per share 148,448 126,324 123,238 Earnings per share: Basic $ 1.68 $ 0.30 $ 0.29 Diluted $ 1.63 $ 0.29 $ 0.29 |
Accounts Receivable - Net (Tabl
Accounts Receivable - Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | |
Accounts Receivable - Net | December 31, 2021 2020 Accounts receivable $ 885 $ 875 Allowance for doubtful accounts ( 9 ) ( 12 ) $ 876 $ 863 |
Inventories Net (Tables)
Inventories Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | December 31, 2021 2020 Raw materials $ 174 $ 127 Work in process 17 19 Finished products 549 526 $ 740 $ 672 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment - Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment - Net | December 31, 2021 2020 Machinery and equipment $ 602 $ 598 Buildings and improvements 292 289 Construction in progress 35 46 Others 4 14 933 947 Accumulated depreciation ( 646 ) ( 629 ) $ 287 $ 318 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets - Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Other Intangible Assets With Finite Lives | Other intangible assets with finite lives are comprised of: December 31, 2021 December 31, 2020 Gross Accumulated Net Gross Accumulated Net Patents and technology $ 31 $ ( 23 ) $ 8 $ 37 $ ( 23 ) $ 14 Customer relationships 162 ( 106 ) 56 192 ( 122 ) 70 Trademarks 14 ( 8 ) 6 15 ( 8 ) 7 Software 162 ( 112 ) 50 146 ( 102 ) 44 $ 369 $ ( 249 ) $ 120 $ 390 $ ( 255 ) $ 135 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Liabilities | December 31, 2021 2020 Obligations payable under Indemnification Agreements $ 140 $ 140 Taxes payable 54 62 Compensation, benefit and other employee-related 114 105 Customer rebate reserve 94 91 Other 199 197 $ 601 $ 595 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Loss Contingencies [Line Items] | |
Summary of Recorded Obligations for Product Warranties and Product Performance Guarantee | The following table summarizes information concerning recorded obligations for product warranties and product performance guarantees. Years Ended December 31, 2021 2020 2019 Beginning balance $ 22 $ 25 $ 26 Accruals for warranties/guarantees issued during the year 22 21 15 Adjustment of pre-existing warranties/guarantees ( 3 ) ( 7 ) - Settlement of warranty/guarantee claims ( 18 ) ( 17 ) ( 16 ) Ending balance $ 23 $ 22 $ 25 |
Honeywell | |
Loss Contingencies [Line Items] | |
Summary of Reimbursement Agreement Liabilities | The following table summarizes information concerning the Company’s Reimbursement Agreement liabilities: Years Ended December 31, 2021 2020 2019 Beginning balance $ 591 $ 585 $ 616 Accruals for indemnification liabilities deemed probable and reasonably estimable 146 146 179 Reduction (1) - - ( 71 ) Indemnification payment ( 140 ) ( 140 ) ( 139 ) Ending balance (2) $ 597 $ 591 $ 585 (1) Reduction in indemnification liabilities relates to a provision in the Reimbursement Agreement that reduces the obligation due to Honeywell for any proceeds received by Honeywell from a property sale of a site under the agreement. (2) Reimbursement Agreement liabilities deemed probable and reasonably estimable, however, it is possible the Company could pay $ 140 million per year (exclusive of any late payment fees up to 5 % per annum) until the earlier of (1) December 31, 2043; or (2) December 31 of the third consecutive year during which the annual reimbursement obligation (including in respect of deferred payment amounts) has been less than $ 25 million. |
Summary of Reimbursement Agreement Liabilities Included in Balance Sheet Accounts | Reimbursement Agreement liabilities are included in the following balance sheet accounts: Years Ended December 31, 2021 2020 Accrued liabilities $ 140 $ 140 Obligations payable under Indemnification Agreements 457 451 $ 597 $ 591 |
Long-term Debt and Credit Agr_2
Long-term Debt and Credit Agreement (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The Company’s debt at December 31, 2021 and December 31, 2020 consisted of the following: December 31, 2021 2020 6.125 % Senior notes due 2026 $ - $ 400 4.000 % Senior notes due 2029 300 - Five-year variable rate term loan A due 2023 - 315 Seven-year variable rate term loan B due 2025 - 465 Seven-year variable rate term loan B due 2028 943 - Unamortized deferred financing costs ( 13 ) ( 18 ) Total outstanding indebtedness 1,230 1,162 Less: Amounts expected to be paid within one year 10 7 Total long-term debt due after one year $ 1,220 $ 1,155 |
Scheduled Principal Repayments Under Senior Credit Facilities and Senior Notes | Scheduled principal repayments under the Senior Credit Facilities (defined below) and Senior Notes (defined below) subsequent to December 31, 2021 are as follows: December 31, 2021 2022 $ 10 2023 10 2024 10 2025 10 2026 10 Thereafter 1,193 1,243 Amounts expected to be paid within one year 10 $ 1,233 |
Pension (Tables)
Pension (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | |
Summary of Balance Sheet Impact, Including Benefit Obligations, Assets and Funded Status | The following tables summarize the balance sheet impact, including the benefit obligations, assets and funded status associated with the pension plans. U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Change in benefit obligation: Benefit obligation at beginning of year $ 374 $ 344 $ 286 $ 161 $ 137 $ 93 Service cost 7 7 5 7 7 5 Interest cost 10 11 13 1 1 2 Actuarial (gains) losses ( 20 ) 38 51 ( 18 ) 6 27 Net benefits paid ( 5 ) ( 4 ) ( 13 ) - - - Settlements ( 18 ) ( 22 ) - ( 1 ) ( 6 ) ( 3 ) Other - - 2 1 2 13 Exchange rate adjustments - - - ( 10 ) 14 - Benefit obligation at end of year 348 374 344 141 161 137 Change in plan assets: Fair value of plan assets at beginning of year 340 331 274 28 27 20 Actual return on plan assets 25 35 70 2 - 2 Contributions - 1 - 3 2 2 Net benefits paid ( 5 ) ( 4 ) ( 13 ) 1 - 1 Settlements ( 18 ) ( 22 ) - ( 1 ) ( 6 ) ( 3 ) Other - ( 1 ) - - 3 5 Exchange rate adjustments - - - ( 1 ) 2 - Fair value of plan assets at end of year 342 340 331 32 28 27 Funded status of plans (non-current) $ ( 6 ) $ ( 34 ) $ ( 13 ) $ ( 109 ) $ ( 133 ) $ ( 110 ) |
Summary of Accumulated Other Comprehensive (Loss) Associated with Pension Plans | Amounts recognized in Accumulated other comprehensive (loss) associated with pension plans at December 31, 2021 and 2020 are as follows: U.S. Plans Non-U.S. Plans 2021 2020 2021 2020 Prior service credit $ ( 2 ) $ ( 2 ) $ - $ - Net actuarial loss (gain) 2 30 ( 2 ) 14 Net amount recognized $ - $ 28 $ ( 2 ) $ 14 |
Summary of Net Periodic Benefit Cost and Other Amounts Recognized in Comprehensive Income | The components of net periodic benefit cost and other amounts recognized in Comprehensive income for pension plans include the following components: U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Net Periodic Benefit Cost Service cost $ 7 $ 7 $ 5 $ 7 $ 7 $ 5 Interest cost 10 11 13 1 1 2 Expected return on plan assets ( 16 ) ( 17 ) ( 16 ) ( 1 ) ( 1 ) ( 1 ) Amortization of prior service credit ( 1 ) ( 1 ) ( 1 ) - - - Mark to market adjustment - - 1 ( 3 ) 6 16 Other - 3 - - - 2 Net periodic benefit cost $ - $ 3 $ 2 $ 4 $ 13 $ 24 |
Summary of Net Periodic Benefit (Income) Cost Other Than The Service Cost Included in Other Expense, Net | The components of net periodic benefit cost other than the service cost are included in Other expense, net in the Consolidated Statements of Operations for the years ended December 31, 2021, 2020 and 2019. U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Other Changes in Plan Assets and Benefits Obligations Recognized in Other Comprehensive Loss (Income) Actuarial (gains) losses $ ( 20 ) $ 38 $ 51 $ ( 18 ) $ 6 $ 26 Excess return on plan assets (1) ( 9 ) ( 17 ) ( 54 ) - - ( 1 ) Actuarial gains recognized during the year - ( 2 ) - 3 ( 6 ) ( 17 ) Other 1 - - ( 1 ) 1 - Total recognized in other comprehensive loss (income) $ ( 28 ) $ 19 $ ( 3 ) $ ( 16 ) $ 1 $ 8 Total recognized in net periodic benefit cost and other comprehensive loss (income) $ ( 28 ) $ 22 $ ( 1 ) $ ( 12 ) $ 14 $ 32 (1) Represents actual return on plan assets in excess of the expected return. |
Summary of Amounts Relate to Pension Plans with Accumulated Benefit Obligations Exceeding Fair Value of Plan Assets | The following amounts relate to pension plans with accumulated benefit obligations exceeding the fair value of plan assets. December 31, U.S. Plans Non-U.S. Plans 2021 2020 2021 2020 Projected benefit obligation $ 3 $ 374 $ 139 $ 161 Accumulated benefit obligation $ 2 $ 358 $ 124 $ 139 Fair value of plan assets $ - $ 340 $ 31 $ 28 |
Summary of Pension Plan with Projected Benefit Obligations Exceeding Fair Value of Plan Assets | The following amounts relate to pension plans with projected benefit obligations exceeding the fair value of the plan assets. December 31, U.S. Plans Non-U.S. Plans 2021 2020 2021 2020 Projected benefit obligation $ 348 $ 374 $ 141 $ 161 Accumulated benefit obligation $ 337 $ 358 $ 125 $ 139 Fair value of plan assets $ 342 $ 340 $ 32 $ 28 |
Summary of NAV and Fair Values of Both U.S. and Non-U.S. Pension Plans Assets by Asset Category | A majority of the U.S. pension plan assets as of December 31, 2021 do not have published pricing and are valued using Net Asset Value (“NAV”) which approximates fair value. NAV by asset category and fair value by asset category are as follows for December 31, 2021 and 2020: U.S. Plans December 31, 2021 December 31, 2020 Total NAV Total NAV Level 1 Cash and cash equivalents $ 4 $ 4 $ 6 $ 1 $ 5 Equity 95 95 105 105 - Investment funds 16 16 14 14 - U.S. treasury obligations - - 16 16 - Government bonds 39 39 41 41 - Corporate bonds 153 153 126 126 - Real estate / property 35 35 32 32 - Total assets at fair value $ 342 $ 342 $ 340 $ 335 $ 5 The fair values of the non-U.S. pension plan assets as by asset category are as follows: Non-U.S. Plans December 31, 2021 December 31, 2020 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Equity $ 1 $ 1 $ - $ - $ 1 $ 1 $ - $ - Government bonds 1 - 1 - 1 - 1 - Insurance contracts 10 - - 10 10 - - 10 Other 20 - - 20 16 - - 16 Total assets at fair value $ 32 $ 1 $ 1 $ 30 $ 28 $ 1 $ 1 $ 26 5 |
Summary of Changes in Fair Value of Level 3 Assets for Non-U.S | The following table summarizes changes in the fair value of Level 3 assets for Non-U.S. plans: Non-U.S. Plans Balance at December 31, 2018 $ 6 Return on plan assets 2 Purchases, sales and settlements, net 15 Other 1 Balance at December 31, 2019 24 Return on plan assets - Purchases, sales and settlements, net ( 1 ) Other 3 Balance at December 31, 2020 26 Return on plan assets 1 Purchases, sales and settlements, net 4 Other ( 1 ) Balance at December 31, 2021 $ 30 |
Pension Plan | |
Defined Benefit Plan Disclosure [Line Items] | |
Summary of Significant Actuarial Assumptions Used in Determining Benefit Obligations and Net Periodic Benefit (Income) Cost | Significant actuarial assumptions used in determining the benefit obligations and net periodic benefit (income) cost for benefit plans are presented in the following table as weighted averages. U.S. Plans Non-U.S. Plans 2021 2020 2019 2021 2020 2019 Actuarial assumptions used to determine benefit obligations as of December 31: Discount rate 3.0 % 2.7 % 3.3 % 1.2 % 0.7 % 1.1 % Interest crediting rate 6.0 % 6.0 % 6.0 % 1.5 % 1.5 % 1.5 % Expected annual rate of compensation increase 3.2 % 3.5 % 3.4 % 2.4 % 2.4 % 2.4 % Actuarial assumptions used to determine net periodic benefit cost for the year ended December 31: Discount rate - benefit obligation 2.7 % 3.3 % 4.5 % 0.7 % 1.1 % 2.0 % Interest crediting rate 6.0 % 6.0 % 6.0 % 1.5 % 1.5 % 1.5 % Expected rate of return on plan assets 4.7 % 5.4 % 5.7 % 2.3 % 2.7 % 2.8 % Expected annual rate of compensation increase 3.5 % 3.4 % 3.4 % 2.4 % 2.4 % 2.4 % |
Summary of Benefit Payments | Benefit payments, including amounts to be paid from Company assets, and reflecting expected future service, as appropriate, are expected to be paid as follows: U.S. Plans Non-U.S. Plans 2022 $ 15 $ 3 2023 $ 15 $ 2 2024 $ 16 $ 3 2025 $ 17 $ 3 2026 $ 18 $ 3 2027-2031 $ 96 $ 23 |
Geographic Areas - Financial _2
Geographic Areas - Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segments, Geographical Areas [Abstract] | |
Schedule of Geographic Areas | Net Revenue (1) Long-lived Assets (2) 2021 2020 2019 2021 2020 2019 United States $ 4,181 $ 3,543 $ 3,423 $ 244 $ 260 $ 272 Europe 1,196 1,121 1,117 139 144 136 Other International 469 407 448 46 47 45 $ 5,846 $ 5,071 $ 4,988 $ 429 $ 451 $ 453 (1) Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. (2) Long-lived assets are comprised of Property, plant and equipment – net and lease right-of-use assets. |
Organization, Operations and Ba
Organization, Operations and Basis of Presentation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 14, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Nov. 17, 2020 |
Cost of goods sold | $ 4,285 | $ 3,758 | $ 3,711 | ||
Gross profit | 1,561 | 1,313 | 1,277 | ||
Selling, general and administrative expenses | $ 916 | $ 925 | $ 932 | ||
Common stock, shares issued | 146,248,000 | 143,959,000 | |||
Common Stock | Public Offering | |||||
Underwriting agreement date | Nov. 17, 2020 | ||||
Common stock, shares issued | 17,000,000 | ||||
Shares issued, offering price per share | $ 15 | $ 15 | |||
Additional common stock shares purchased | 2,550,000 | ||||
Proceeds from issuance of common stock | $ 279 | ||||
Underwriting discount deduction amount | 13 | ||||
Offering expense payable amount | $ 1 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) | Oct. 29, 2018USD ($) | Oct. 14, 2018USD ($) | Dec. 31, 2021USD ($)ReportingUnit | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Summary Of Significant Accounting Policies [Line Items] | |||||
Number of reporting units | ReportingUnit | 2 | ||||
Trademark license agreement | 40 years | ||||
Advertising costs | $ 22,000,000 | $ 25,000,000 | $ 46,000,000 | ||
Compensation expense related to employer contributions | $ 19,000,000 | 18,000,000 | 18,000,000 | ||
Defined benefit plan net actuarial gains and losses in excess of fair value of plan assets or plan's projected benefit obligation percentage | 10.00% | ||||
Aggregate lease, liability | $ 152,000,000 | ||||
Right-of-use asset | $ 141,000,000 | $ 133,000,000 | |||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | Other assets | |||
Tax Matters Agreement | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Indemnity outstanding for past and potential future tax payments | $ 128,000,000 | $ 139,000,000 | |||
Honeywell | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Indemnity liability annual cap | $ 140,000,000 | $ 140,000,000 | $ 140,000,000 | ||
Honeywell | Indemnification and Reimbursement Agreement | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Indemnification payable percentage of payments | 90.00% | 90.00% | |||
Indemnification payable percentage of net insurance receipts | 90.00% | 90.00% | |||
Indemnification payable percentage of net proceeds received | 90.00% | 90.00% | |||
Trademarks | Honeywell | Selling, General and Administrative Expenses | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Royalty fee percentage of net revenue | 1.50% | ||||
Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets, useful life | 3 years | ||||
Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Intangible assets, useful life | 15 years | ||||
Maximum | Indemnification and Reimbursement Agreement | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Indemnity liability annual cap | $ 140,000,000 | ||||
Maximum | Honeywell | Indemnification and Reimbursement Agreement | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Indemnity liability annual cap | $ 140,000,000 | ||||
Buildings and Improvements | Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment, estimated useful lives | 10 years | ||||
Buildings and Improvements | Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment, estimated useful lives | 50 years | ||||
Machinery and Equipment | Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment, estimated useful lives | 3 years | ||||
Machinery and Equipment | Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment, estimated useful lives | 16 years | ||||
Tooling Equipment | Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment, estimated useful lives | 3 years | ||||
Tooling Equipment | Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Property, plant and equipment, estimated useful lives | 10 years |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Disaggregated Revenue (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | [1] | $ 5,846 | $ 5,071 | $ 4,988 |
Products & Solutions | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | 2,468 | 2,121 | 2,175 | |
Products & Solutions | Comfort | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | 1,207 | 1,079 | 1,103 | |
Products & Solutions | Security | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | 667 | 538 | 520 | |
Products & Solutions | Residential Thermal Solutions | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | 594 | 504 | 552 | |
ADI Global Distribution | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | 3,378 | 2,950 | 2,813 | |
ADI Global Distribution | U.S. and Canada | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | 2,814 | 2,427 | 2,294 | |
ADI Global Distribution | EMEA | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | [2] | 523 | 480 | 459 |
ADI Global Distribution | APAC | ||||
Disaggregation Of Revenue [Line Items] | ||||
Net revenue | [3] | $ 41 | $ 43 | $ 60 |
[1] | Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. | |||
[2] | EMEA represents Europe, the Middle East and Africa. | |||
[3] | APAC represents Asia and Pacific countries. |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, performance obligation, description of payment terms | The timing of satisfaction of the Company’s performance obligations does not significantly vary from the typical timing of payment. For some contracts, the Company may be entitled to receive an advance payment. |
Revenue, practical expedient, financing component | true |
Percentage of revenue satisfied over time | 3.00% |
Revenue Recognition - Additio_2
Revenue Recognition - Additional Information (Details 1) | Dec. 31, 2021 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01 | |
Disaggregation Of Revenue [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Segment Financial Data - Additi
Segment Financial Data - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2021Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Segment Financial Data - Schedu
Segment Financial Data - Schedule of Segment Information (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Revenue | ||||
Total revenue | [1] | $ 5,846 | $ 5,071 | $ 4,988 |
Operating profit | ||||
Total | 559 | 311 | 258 | |
Depreciation and amortization | ||||
Depreciation and amortization | 88 | 86 | 80 | |
Capital expenditures | ||||
Total | 63 | 70 | 95 | |
Products & Solutions | ||||
Revenue | ||||
Total revenue | 2,468 | 2,121 | 2,175 | |
Operating profit | ||||
Total | 541 | 407 | 327 | |
Depreciation and amortization | ||||
Depreciation and amortization | 65 | 63 | 62 | |
Capital expenditures | ||||
Total | 37 | 41 | 71 | |
ADI Global Distribution | ||||
Revenue | ||||
Total revenue | 3,378 | 2,950 | 2,813 | |
Operating profit | ||||
Total | 268 | 194 | 210 | |
Depreciation and amortization | ||||
Depreciation and amortization | 11 | 12 | 10 | |
Capital expenditures | ||||
Total | 24 | 15 | 5 | |
Corporate | ||||
Operating profit | ||||
Total | (250) | (290) | (279) | |
Depreciation and amortization | ||||
Depreciation and amortization | 12 | 11 | 8 | |
Capital expenditures | ||||
Total | 2 | 14 | 19 | |
Operating Segments | Products & Solutions | ||||
Revenue | ||||
Total revenue | 2,841 | 2,488 | 2,487 | |
Intersegment Revenue Eliminations | Products & Solutions | ||||
Revenue | ||||
Total revenue | $ 373 | $ 367 | $ 312 | |
[1] | Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 29, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of awards granted | 16,000,000 | ||||
Number of shares available for grant | 6,357,544 | ||||
Number of stock options exercised | 376,424 | ||||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of restricted stock units granted | 1,142,310 | 2,262,676 | 1,285,167 | ||
Remaining term of unvested awards | 1 year 4 months 24 days | ||||
Total unrecognized compensation cost | $ 19 | ||||
Fair value of RSUs vested | $ 48 | ||||
Number of outstanding RSUs performance based | 3,477,133 | 4,286,964 | 3,518,250 | 3,338,184 | |
Performance-Based Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Remaining term of unvested awards | 2 years | ||||
Total unrecognized compensation cost | $ 11 | ||||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Remaining term of unvested awards | 2 years 18 days | ||||
Expiration period | 7 years | ||||
Weighted average grant date fair value per share | $ 7.69 | ||||
Total unrecognized compensation cost related to non-vested stock options granted | $ 1 | ||||
Minimum | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 1 year | ||||
Maximum | Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 7 years |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - Summary of Fair Values Estimated for PSUs (Details) - Performance Stock Unit (PSU) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 47.43% | 33.70% |
Risk-free interest rate % | 0.20% | 0.80% |
Expected term (in years) | 2 years 10 months 9 days | 2 years 9 months 14 days |
Dividend yield | 0.00% | 0.00% |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans - Summarized RSU and PSU Activity Related to Stock Incentive Plan (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Performance Stock Unit (PSU) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of performance/restricted stock units, Non-vested, Beginning balance | 912,800 | 276,281 | 0 |
Number of performance/restricted stock units, Granted | 500,227 | 795,099 | 322,037 |
Number of performance/restricted stock units, Vested | 0 | 0 | 0 |
Number of performance/restricted stock units, Forfeited | (95,467) | (158,580) | (45,756) |
Number of performance/restricted stock units, Non-vested, ending balance | 1,317,560 | 912,800 | 276,281 |
Weighted Average Grant Date Fair Value Per Share, Non-vested, Beginning balance | $ 10.09 | $ 24.33 | $ 0 |
Weighted Average Grant Date Fair Value Per Share, Granted | 42.98 | 6.33 | 24.32 |
Weighted Average Grant Date Fair Value Per Share, Vested | 0 | 0 | 0 |
Weighted Average Grant Date Fair Value Per Share, Forfeited | 17.20 | 16.06 | 24.39 |
Weighted Average Grant Date Fair Value Per Share, Non-vested, Ending balance | $ 22.06 | $ 10.09 | $ 24.33 |
Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of performance/restricted stock units, Non-vested, Beginning balance | 4,286,964 | 3,518,250 | 3,338,184 |
Number of performance/restricted stock units, Granted | 1,142,310 | 2,262,676 | 1,285,167 |
Number of performance/restricted stock units, Vested | (1,714,810) | (921,060) | (509,366) |
Number of performance/restricted stock units, Forfeited | (237,331) | (572,902) | (595,735) |
Number of performance/restricted stock units, Non-vested, ending balance | 3,477,133 | 4,286,964 | 3,518,250 |
Weighted Average Grant Date Fair Value Per Share, Non-vested, Beginning balance | $ 17.38 | $ 23.05 | $ 24.05 |
Weighted Average Grant Date Fair Value Per Share, Granted | 27.39 | 10.55 | 21.21 |
Weighted Average Grant Date Fair Value Per Share, Vested | 19.27 | 21.07 | 23.78 |
Weighted Average Grant Date Fair Value Per Share, Forfeited | 20.44 | 19.27 | 24.05 |
Weighted Average Grant Date Fair Value Per Share, Non-vested, Ending balance | $ 19.52 | $ 17.38 | $ 23.05 |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans - Summary of Fair Value of Stock Options (Details) - Stock Options | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected stock price volatility | 34.00% | ||
Expected stock price volatility, Minimum | 31.00% | 30.00% | |
Expected stock price volatility, Maximum | 37.00% | 32.00% | |
Expected term of options | 5 years | 4 years 6 months | 4 years 6 months |
Risk-free interest rate | 0.77% | ||
Risk-free interest rate, Minimum | 0.25% | 2.22% | |
Risk-free interest rate, Maximum | 1.41% | 2.47% |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Number of Stock Options outstanding, Beginning balances | 1,725,223 | 990,254 | |
Number of Stock Options, Granted | 150,000 | 1,083,665 | 1,155,566 |
Number of Stock Options, Forfeited | (152,831) | (348,696) | (165,312) |
Number of Stock Options, Exercised | (376,424) | ||
Number of Stock Options outstanding, Ending balances | 1,345,968 | 1,725,223 | 990,254 |
Number of Stock Options, Vested and expected to vest | 1,165,667 | ||
Number of Stock Options, Exercisable | 443,956 | ||
Weighted Average Exercise Price, Stock Options outstanding, Beginning balance | $ 15.98 | $ 24.36 | |
Weighted Average Exercise Price, Stock Options Granted | 25.48 | 9.17 | $ 24.37 |
Weighted Average Exercise Price, Stock Options Forfeited | 16.47 | 18.39 | 24.39 |
Weighted Average Exercise Price, Stock Options Exercised | 21.62 | ||
Weighted Average Exercise Price, Stock Options outstanding, Ending balance | 15.41 | $ 15.98 | $ 24.36 |
Weighted Average Exercise Price, Stock Options vested and expected to vest | 15.52 | ||
Weighted Average Exercise Price, Stock Options exercisable | $ 18.27 | ||
Weighted Average Contractual Life (years). Stock Options outstanding | 4 years 10 months 24 days | 4 years 10 months 24 days | 6 years |
Weighted Average Contractual Life (years), Stock Options vested and expected to vest | 4 years 9 months 18 days | ||
Weighted Average Contractual Life (years), Stock Options exercisable | 4 years 2 months 12 days | ||
Aggregate Intrinsic Value, Balances | $ 12 | ||
Aggregate Intrinsic Value, Exercised | 3 | ||
Aggregate Intrinsic Value, Balances | 14 | $ 12 | |
Aggregate Intrinsic Value, Options vested and expected to vest | 12 | ||
Aggregate Intrinsic Value, Options exercisable | $ 3 |
Stock-Based Compensation Plan_7
Stock-Based Compensation Plans - Summarized Stock-Based Compensation Expense and Related Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Compensation Related Costs [Abstract] | |||
Stock-based compensation expense before income taxes | $ 39 | $ 29 | $ 25 |
Less: Income tax expense (benefit) | (3) | 1 | (1) |
Stock-based compensation expense, net of income taxes | $ 36 | $ 30 | $ 24 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | |||
Variable lease costs | $ 17 | $ 16 | $ 11 |
Leases - Schedule of Operating
Leases - Schedule of Operating Lease Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee Lease Description [Line Items] | |||
Total operating lease costs | $ 63 | $ 61 | $ 53 |
Selling, General and Administrative Expenses | |||
Lessee Lease Description [Line Items] | |||
Total operating lease costs | 46 | 44 | 37 |
Cost of Goods Sold | |||
Lessee Lease Description [Line Items] | |||
Total operating lease costs | $ 17 | $ 17 | $ 16 |
Leases - Summary of Lease Recog
Leases - Summary of Lease Recognized Related to Operating Leases (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Operating right-of-use assets | $ 141 | $ 133 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | Other assets |
Operating lease liabilities - current | $ 32 | $ 33 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued liabilities | Accrued liabilities |
Operating lease liabilities - non-current | $ 120 | $ 107 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other liabilities | Other liabilities |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Millions | Dec. 31, 2021USD ($) |
Leases [Abstract] | |
2022 | $ 39 |
2023 | 35 |
2024 | 25 |
2025 | 20 |
2026 | 17 |
Thereafter | 43 |
Total lease payments | 179 |
Less: Imputed interest | 27 |
Present value of operating lease liabilities | $ 152 |
Weighted-average remaining lease term (years) | 6 years 14 days |
Weighted-average incremental borrowing rate | 5.42% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Operating Leases (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | |||
Operating cash outflows | $ 33 | $ 30 | $ 35 |
Operating right-of-use assets obtained in exchange for operating lease liabilities | $ 46 | $ 26 | $ 60 |
Restructuring Charges - Additio
Restructuring Charges - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | $ 40 | $ 37 |
Severance | Products & Solutions | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | 19 | 26 |
Severance | ADI Global Distribution | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | 6 | 4 |
Severance | Corporate | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | $ 15 | $ 7 |
Restructuring Charges - Summary
Restructuring Charges - Summary of Restructuring Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | $ 40 | $ 37 |
Cost of Goods Sold | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | 9 | 13 |
Research and Development Expenses | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | 3 | 7 |
Selling, General and Administrative Expenses | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring expenses | $ 28 | $ 17 |
Restructuring Charges - Summa_2
Restructuring Charges - Summary of Status of Total Restructuring Reserves Related to Severance Cost Included in Accrued Liabilities in the Consolidated Balance Sheets (Details) - Accrued Liabilities - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restructuring Cost And Reserve [Line Items] | |||
Beginning of year | $ 24 | $ 19 | $ 13 |
Charges | 40 | 38 | |
Usage | (11) | (35) | (31) |
Other | (4) | (1) | |
End of year | $ 9 | $ 24 | $ 19 |
Other Expense, Net - Summary of
Other Expense, Net - Summary of Other Expense Net (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Other Income and Expenses [Abstract] | |||
Reimbursement Agreement expense | $ 146 | $ 146 | $ 108 |
Loss on extinguishment of debt | 41 | 0 | 0 |
Other, net | (29) | 1 | 10 |
Other expense net | $ 158 | $ 147 | $ 118 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Before Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ 79 | $ (93) | $ (83) |
Non-U.S. | 274 | 194 | 154 |
Income before taxes | $ 353 | $ 101 | $ 71 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | |||
U.S. | $ 60 | $ 21 | $ 23 |
Non-U.S. | 45 | 21 | 37 |
Income tax expense (benefit), current | 105 | 42 | 60 |
Deferred: | |||
U.S. | 5 | 11 | (11) |
Non-U.S. | 1 | 11 | (14) |
Income tax expense (benefit), deferred | 6 | 22 | (25) |
Income tax expense (benefit) | $ 111 | $ 64 | $ 35 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation, Income Tax expense (Benefit) (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
U.S. federal statutory income tax rate | 21.00% | 21.00% | 21.00% |
Impact of foreign operations | (0.20%) | (5.40%) | (10.20%) |
U.S. state income taxes | 3.60% | 6.40% | 6.60% |
Non-deductible indemnification costs | 8.40% | 29.00% | 28.00% |
Executive compensation over $1 million | 0.90% | 2.50% | 0.60% |
Other non-deductible expenses | (0.40%) | 3.70% | 2.90% |
U.S. taxation of foreign earnings | 1.40% | 3.50% | 5.30% |
Tax credits | (0.70%) | (0.20%) | (2.60%) |
Change in tax rates | (1.00%) | 1.30% | 1.70% |
All other items – net | (2.50%) | 1.80% | (4.70%) |
Effective income tax rate | 31.30% | 63.60% | 48.60% |
Income Taxes - Schedule of Ef_2
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation, Income Tax expense (Benefit) (Parenthetical) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Effective income tax rate reconciliation, executive compensation amount | $ 1 | $ 1 | $ 1 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Liabilities and Assets (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets: | ||
Pension | $ 24 | $ 37 |
Other asset basis differences | 63 | 70 |
Operating lease liabilities | 33 | 34 |
Accruals and reserves | 50 | 61 |
Net operating and capital losses | 48 | 47 |
Other | 2 | |
Gross deferred tax assets | 220 | 249 |
Valuation allowance | (63) | (60) |
Total deferred tax assets | 157 | 189 |
Deferred tax liabilities: | ||
Other intangible assets | (39) | (44) |
Property, plant and equipment | (23) | (25) |
Operating lease assets | (33) | (32) |
Other | (5) | (13) |
Total deferred tax liabilities | (100) | (114) |
Net deferred tax asset | $ 57 | $ 75 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes [Line Items] | |||
Valuation allowance | $ 63 | $ 60 | |
Undistributed earnings from foreign subsidiaries | 1,900 | ||
Undistributed earnings from foreign subsidiaries not considered indefinitely reinvested | 6 | ||
Unrecognized tax benefits | 16 | ||
Unrecognized tax benefits resulted in increases (decreases) | 6 | 4 | $ 4 |
Non-U.S. | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | 189 | ||
Non-U.S. | Carried Forward Indefinitely | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 171 | ||
Non-U.S. | Earliest Tax Year | |||
Income Taxes [Line Items] | |||
Operating loss carryforward expiration period | 2022 | ||
Non-U.S. | Latest Tax Year | |||
Income Taxes [Line Items] | |||
Operating loss carryforward expiration period | 2031 | ||
Federal | |||
Income Taxes [Line Items] | |||
Federal tax credit carryforwards | $ 10 | $ 6 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Net income | $ 242 | $ 37 | $ 36 |
Shares used in computing basic earnings per share | 144,036 | 125,348 | 122,722 |
Effect of dilutive securities: | |||
Dilutive effect of common stock equivalents | 4,412 | 976 | 516 |
Shares used in computing diluted earnings per share | 148,448 | 126,324 | 123,238 |
Earnings per share: | |||
Basic | $ 1.68 | $ 0.30 | $ 0.29 |
Diluted | $ 1.63 | $ 0.29 | $ 0.29 |
Earnings Per Share - Addtional
Earnings Per Share - Addtional Information (Details) - $ / shares shares in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Line Items] | ||
Spin-off transaction, common stock par value per share | $ 0.001 | $ 0.001 |
Options and Other Rights | ||
Earnings Per Share [Line Items] | ||
Purchase of outstanding common stock were anti-dilutive | 0.2 | 2.8 |
Performance Based Unit Awards | ||
Earnings Per Share [Line Items] | ||
Purchase of outstanding common stock were anti-dilutive | 0.6 | 0.2 |
Accounts Receivable Net (Detail
Accounts Receivable Net (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | ||
Accounts receivable | $ 885 | $ 875 |
Allowance for doubtful accounts | (9) | (12) |
Accounts receivable – net | $ 876 | $ 863 |
Inventories Net (Details)
Inventories Net (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 174 | $ 127 |
Work in process | 17 | 19 |
Finished products | 549 | 526 |
Inventory, Net | $ 740 | $ 672 |
Inventories Net - Additional In
Inventories Net - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |||
Expense related to inventory obsolescence | $ 8 | $ 31 | $ 56 |
Property Plant and Equipment -
Property Plant and Equipment - Net - Schedule of Property Plant and Equipment - Net (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 933 | $ 947 |
Accumulated depreciation | (646) | (629) |
Property, plant and equipment, net | 287 | 318 |
Machinery and equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 602 | 598 |
Buildings and improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 292 | 289 |
Construction in progress | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 35 | 46 |
Others | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 4 | $ 14 |
Property Plant and Equipment _2
Property Plant and Equipment - Net - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment, Net [Abstract] | |||
Depreciation | $ 58 | $ 56 | $ 50 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Feb. 29, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Business Acquisition [Line Items] | ||||
Business acquisition | $ 11 | $ 35 | $ 17 | |
Goodwill | 2,661 | 2,691 | ||
ADI Global Distribution | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 651 | 654 | ||
ADI Global Distribution | Norfolk Wire & Electronics and Shoreview Distribution | ||||
Business Acquisition [Line Items] | ||||
Business acquisition | 11 | |||
ADI Global Distribution | Herman ProAV | ||||
Business Acquisition [Line Items] | ||||
Business acquisition | $ 36 | |||
Goodwill | 4 | |||
Business acquisition, intangible assets acquired | $ 18 | |||
Products & Solutions | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 2,010 | $ 2,037 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Net - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Line Items] | |||
Goodwill | $ 2,661 | $ 2,691 | |
Amortization | 30 | 31 | $ 30 |
2022 | 24 | ||
2023 | 21 | ||
2024 | 19 | ||
2025 | 18 | ||
2026 | 14 | ||
Products & Solutions | |||
Goodwill [Line Items] | |||
Goodwill | 2,010 | 2,037 | |
Acquisitions | 5 | ||
ADI Global Distribution | |||
Goodwill [Line Items] | |||
Goodwill | $ 651 | $ 654 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Net - Schedule of Other Intangible Assets With Finite Lives (Detail) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 369 | $ 390 |
Accumulated Amortization | (249) | (255) |
Net Carrying Amount | 120 | 135 |
Patent and Technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 31 | 37 |
Accumulated Amortization | (23) | (23) |
Net Carrying Amount | 8 | 14 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 162 | 192 |
Accumulated Amortization | (106) | (122) |
Net Carrying Amount | 56 | 70 |
Trademarks | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 14 | 15 |
Accumulated Amortization | (8) | (8) |
Net Carrying Amount | 6 | 7 |
Software | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 162 | 146 |
Accumulated Amortization | (112) | (102) |
Net Carrying Amount | $ 50 | $ 44 |
Accrued Liabilities - Summary o
Accrued Liabilities - Summary of Accrued Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accrued Liabilities, Current [Abstract] | ||
Obligations payable under Indemnification Agreements | $ 140 | $ 140 |
Taxes payable | 54 | 62 |
Compensation, benefit and other employee-related | 114 | 105 |
Customer rebate reserve | 94 | 91 |
Other | 199 | 197 |
Total accrued liabilities | $ 601 | $ 595 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | Jul. 30, 2021 | Oct. 29, 2018 | Oct. 14, 2018 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Loss Contingencies [Line Items] | ||||||
Environmental liabilities | $ 22,000,000 | $ 22,000,000 | $ 22,000,000 | |||
Trademark license agreement | 40 years | |||||
Settlement to be paid | $ 55,000,000 | |||||
Insurance recoveries | $ 39,000,000 | |||||
Purchase Commitments | ||||||
Loss Contingencies [Line Items] | ||||||
Estimated minimum obligations associated with unconditional purchase obligations, not recognized in Consolidated Balance Sheet 2022 | $ 34,000,000 | |||||
Estimated minimum obligations associated with unconditional purchase obligations, not recognized in Consolidated Balance Sheet 2023 | 34,000,000 | |||||
Estimated minimum obligations associated with unconditional purchase obligations, not recognized in Consolidated Balance Sheet 2024 | 31,000,000 | |||||
Estimated minimum obligations associated with unconditional purchase obligations, not recognized in Consolidated Balance Sheet 2025 | 2,000,000 | |||||
Purchases related to obligations | 22,000,000 | 22,000,000 | 24,000,000 | |||
Maximum | ||||||
Loss Contingencies [Line Items] | ||||||
Sale leaseback transaction, aggregate amount | 150,000,000 | |||||
Indemnification Agreement | ||||||
Loss Contingencies [Line Items] | ||||||
Maximum annual reimbursement obligation amount | $ 25,000,000 | |||||
Indemnification agreement description | In connection with the Spin-Off, the Company entered into the Reimbursement Agreement pursuant to which the Company has an obligation to make cash payments to Honeywell in amounts equal to 90% of payments for certain Honeywell environmental-liability payments, which include amounts billed (“payments”), less 90% of Honeywell’s net insurance receipts relating to such liabilities, and less 90% of the net proceeds received by Honeywell in connection with (i) affirmative claims relating to such liabilities, (ii) contributions by other parties relating to such liabilities and (iii) certain property sales (the “recoveries”). The amount payable by the Company in respect of such liabilities arising in respect of any given year is subject to a cap of $140 million. | |||||
Indemnification Agreement | Maximum | ||||||
Loss Contingencies [Line Items] | ||||||
Indemnity liability annual cap | $ 140,000,000 | |||||
Tax Matters Agreement | ||||||
Loss Contingencies [Line Items] | ||||||
Indemnified amount | $ 128,000,000 | 139,000,000 | ||||
Honeywell | ||||||
Loss Contingencies [Line Items] | ||||||
Indemnity liability annual cap | $ 140,000,000 | 140,000,000 | 140,000,000 | |||
Honeywell | Trademark Agreement | ||||||
Loss Contingencies [Line Items] | ||||||
Royalty fee on net revenue | 1.50% | |||||
Royalty expense | $ 21,000,000 | 26,000,000 | 27,000,000 | |||
Honeywell | Maximum | ||||||
Loss Contingencies [Line Items] | ||||||
Maximum annual reimbursement obligation amount | $ 25,000,000 | $ 25,000,000 | $ 25,000,000 | |||
Honeywell | Indemnification Agreement | ||||||
Loss Contingencies [Line Items] | ||||||
Indemnification payable percentage of payments | 90.00% | 90.00% | ||||
Indemnification payable percentage of net insurance receipts | 90.00% | 90.00% | ||||
Indemnification payable percentage of net proceeds received | 90.00% | 90.00% | ||||
Honeywell | Indemnification Agreement | Maximum | ||||||
Loss Contingencies [Line Items] | ||||||
Indemnity liability annual cap | $ 140,000,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Reimbursement Agreement Liabilities (Details) - Honeywell - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accrual for Reimbursement Agreement | |||
Beginning balance | $ 591 | $ 585 | $ 616 |
Accruals for indemnification liabilities deemed probable and reasonably estimable | 146 | 146 | 179 |
Reduction | 0 | (71) | |
Indemnification payment | (140) | (140) | (139) |
Ending balance | $ 597 | $ 591 | $ 585 |
Commitments and Contingencies_3
Commitments and Contingencies - Summary of Reimbursement Agreement Liabilities (Parenthetical) (Details) - Honeywell - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Loss Contingencies [Line Items] | |||
Indemnity liability annual cap | $ 140,000,000 | $ 140,000,000 | $ 140,000,000 |
Maximum | |||
Loss Contingencies [Line Items] | |||
Indemnification payable, late payment fee percentage | 5.00% | 5.00% | 5.00% |
Maximum annual reimbursement obligation amount | $ 25,000,000 | $ 25,000,000 | $ 25,000,000 |
Commitments and Contingencies_4
Commitments and Contingencies - Summary of Reimbursement Agreement Liabilities Included in Balance Sheet Accounts (Details) - Honeywell - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Loss Contingency, Classification of Accrual [Abstract] | ||||
Reimbursement Agreement liabilities | $ 597 | $ 591 | $ 585 | $ 616 |
Accrued Liabilities | ||||
Loss Contingency, Classification of Accrual [Abstract] | ||||
Reimbursement agreement current portion | 140 | 140 | ||
Obligations Payable under Indemnification Agreement | ||||
Loss Contingency, Classification of Accrual [Abstract] | ||||
Reimbursement agreement Long Term Portion | $ 457 | $ 451 |
Commitments and Contingencies_5
Commitments and Contingencies - Summary of Recorded Obligations for Product Warranties and Product Performance Guarantee (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Product Warranties and Guarantees [Roll forward] | |||
Beginning balance | $ 22 | $ 25 | $ 26 |
Accruals for warranties/guarantees issued during the year | 22 | 21 | 15 |
Adjustment of pre-existing warranties/guarantees | (3) | (7) | |
Settlement of warranty/guarantee claims | (18) | (17) | (16) |
Ending balance | $ 23 | $ 22 | $ 25 |
Long-term Debt and Credit Agr_3
Long-term Debt and Credit Agreement - Schedule of Debt (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 1,243 | |
Unamortized deferred financing costs | (13) | $ (18) |
Total outstanding indebtedness | 1,230 | 1,162 |
Less: Amounts expected to be paid within one year | 10 | 7 |
Total long-term debt due after one year | 1,220 | 1,155 |
6.125% notes due 2026 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 0 | 400 |
4.000% notes due 2029 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 300 | 0 |
Five Year Variable Rate Term Loan A Due 2023 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 0 | 315 |
Seven Year Variable Rate Term Loan B Due 2025 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 0 | 465 |
Seven Year Variable Rate Term Loan B Due 2028 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 943 | $ 0 |
Long-term Debt and Credit Agr_4
Long-term Debt and Credit Agreement - Schedule of Debt (Parenthetical) (Details) | Aug. 26, 2021 | Feb. 16, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
6.125% notes due 2026 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 6.125% | 6.125% | ||
Debt instrument maturity year | 2026 | 2026 | 2026 | |
4.000% notes due 2029 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 4.00% | 4.00% | ||
Debt instrument maturity year | 2029 | 2029 | ||
Five Year Variable Rate Term Loan A Due 2023 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.51% | |||
Debt instrument maturity year | 2023 | |||
Seven Year Variable Rate Term Loan B Due 2025 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.51% | |||
Debt instrument maturity year | 2025 | |||
Seven Year Variable Rate Term Loan B Due 2028 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument maturity year | 2028 |
Long-term Debt and Credit Agr_5
Long-term Debt and Credit Agreement - Scheduled Principal Repayments Under Senior Credit Facilities and Senior Notes (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
2022 | $ 10 | |
2023 | 10 | |
2024 | 10 | |
2025 | 10 | |
2026 | 10 | |
Thereafter | 1,193 | |
Long-term debt, gross | 1,243 | |
Amounts expected to be paid within one year | 10 | $ 7 |
Long-term debt noncurrent, gross | $ 1,233 |
Long-term Debt and Credit Agr_6
Long-term Debt and Credit Agreement - Additional Information (Details) - USD ($) | Aug. 26, 2021 | Feb. 16, 2021 | Feb. 12, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||||||
Current maturities of debt | $ 10,000,000 | $ 7,000,000 | ||||
Other expense, net | $ 158,000,000 | 147,000,000 | $ 118,000,000 | |||
Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Sale leaseback transaction, aggregate amount | $ 150,000,000 | |||||
A&R Term B Facility | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 2.75% | |||||
Five Year Variable Rate Term Loan A Due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 2.51% | |||||
Debt instrument maturity year | 2023 | |||||
Seven Year Variable Rate Term Loan B Due 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 2.51% | |||||
Debt instrument maturity year | 2025 | |||||
Senior Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Credit agreement description | On February 12, 2021, the Company entered into an Amendment and Restatement Agreement with JP Morgan Chase Bank N.A. as administrative agent (the “A&R Credit Agreement”). This agreement effectively replaced the Company’s previous senior secured credit facilities. | |||||
Senior Credit Facilities | Letter of Credit | ||||||
Debt Instrument [Line Items] | ||||||
Borrowings from credit facility | $ 0 | |||||
Senior Credit Facilities | A&R Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Borrowings from credit facility | $ 0 | |||||
6.125% notes due 2026 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 6.125% | 6.125% | ||||
Debt instrument maturity year | 2026 | 2026 | 2026 | |||
Debt instrument principal amount redeemed | $ 260,000,000 | $ 140,000,000 | ||||
Debt instrument redemption price percentage | 105.594% | 106.125% | ||||
Senior Notes due 2026 | ||||||
Debt Instrument [Line Items] | ||||||
Other expense, net | $ (41,000,000) | |||||
A&R Credit Agreement | ||||||
Debt Instrument [Line Items] | ||||||
Prepayment premium percentage in connection with repricing transactions | 1.00% | |||||
A&R Credit Agreement | Federal Funds Effective Rate | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 0.05% | |||||
A&R Credit Agreement | London Interbank Offered Rate LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 1.00% | |||||
A&R Credit Agreement | A&R Term B Facility | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount issued | $ 950,000,000 | |||||
Credit facilities term | 7 years | |||||
A&R Credit Agreement | A&R Term B Facility | London Interbank Offered Rate LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 2.25% | |||||
A&R Credit Agreement | A&R Term B Facility | London Interbank Offered Rate LIBOR | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 0.50% | |||||
A&R Credit Agreement | A&R Term B Facility | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 1.25% | |||||
A&R Credit Agreement | A&R Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount issued | $ 500,000,000 | |||||
Credit facilities term | 5 years | |||||
A&R Credit Agreement | A&R Revolving Credit Facility | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Borrowings from credit facility | $ 75,000,000 | |||||
A&R Credit Agreement | A&R Revolving Credit Facility | London Interbank Offered Rate LIBOR | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 1.75% | |||||
A&R Credit Agreement | A&R Revolving Credit Facility | London Interbank Offered Rate LIBOR | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 2.25% | |||||
A&R Credit Agreement | A&R Revolving Credit Facility | Base Rate | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 0.75% | |||||
A&R Credit Agreement | A&R Revolving Credit Facility | Base Rate | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Applicable interest rate on borrowings | 1.25% | |||||
4.000% notes due 2029 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.00% | 4.00% | ||||
Principal amount issued | $ 300,000,000 | |||||
Debt instrument maturity year | 2029 | 2029 | ||||
Debt instrument redemption price percentage | 101.00% |
Derivative Instruments - (Addit
Derivative Instruments - (Additional Information) (Details) $ in Millions | 1 Months Ended | 12 Months Ended |
Mar. 31, 2021USD ($)Interestrateswap | Dec. 31, 2021 | |
Derivative [Line Items] | ||
Number of interest rate swap | Interestrateswap | 8 | |
Notional value | $ | $ 560 | |
Swap agreement description | The effect of the Swap Agreements is to convert a portion of the Company’s variable interest rate obligations based on three-month LIBOR with a minimum rate of 0.50% per annum to a base fixed weighted average rate of 0.9289% over terms ranging from three to five years. The Swap Agreements are adjusted to fair value on a quarterly basis. | |
Fixed weighted average rate | 0.50% | |
Minimum | ||
Derivative [Line Items] | ||
Derivative term | 3 years | |
Maximum | ||
Derivative [Line Items] | ||
Fixed weighted average rate | 0.9289% | |
Derivative term | 5 years |
Financial Instruments and Fai_2
Financial Instruments and Fair Values Measures - Additional Information (Details) $ in Millions | Dec. 31, 2021USD ($) |
Senior Credit Facilities | A&R Term B Facility | |
Debt Instrument [Line Items] | |
Debt Instrument, Fair Value Disclosure | $ 943 |
Senior Notes Due 2029 | |
Debt Instrument [Line Items] | |
Debt Instrument, Fair Value Disclosure | $ 294 |
Pension - Summary of Balance Sh
Pension - Summary of Balance Sheet Impact, Including Benefit Obligations, Assets and Funded Status (Details) - Pension Plan - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Actuarial losses (gains) | $ (38) | ||
Actual return on plan assets | 27 | ||
U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligation at beginning of year | 374 | $ 344 | $ 286 |
Service cost | 7 | 7 | 5 |
Interest cost | 10 | 11 | 13 |
Actuarial losses (gains) | (20) | 38 | 51 |
Net benefits paid | (5) | (4) | (13) |
Settlements | (18) | (22) | |
Other | 0 | 2 | |
Exchange rate adjustments | 0 | ||
Benefit obligation at end of year | 348 | 374 | 344 |
Fair value of plan assets at beginning of year | 340 | 331 | 274 |
Actual return on plan assets | 25 | 35 | 70 |
Contributions | 0 | 1 | |
Net benefits paid | (5) | (4) | (13) |
Settlements | (18) | (22) | |
Other | 0 | (1) | |
Exchange rate adjustments | 0 | ||
Fair value of plan assets at end of year | 342 | 340 | 331 |
Funded status of plans (non-current) | (6) | (34) | (13) |
Non-U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligation at beginning of year | 161 | 137 | 93 |
Service cost | 7 | 7 | 5 |
Interest cost | 1 | 1 | 2 |
Actuarial losses (gains) | (18) | 6 | 27 |
Net benefits paid | 0 | ||
Settlements | (1) | (6) | (3) |
Other | 1 | 2 | 13 |
Exchange rate adjustments | (10) | 14 | |
Benefit obligation at end of year | 141 | 161 | 137 |
Fair value of plan assets at beginning of year | 28 | 27 | 20 |
Actual return on plan assets | 2 | 0 | 2 |
Contributions | 3 | 2 | 2 |
Net benefits paid | 1 | 1 | |
Settlements | (1) | (6) | (3) |
Other | 0 | 3 | 5 |
Exchange rate adjustments | (1) | 2 | |
Fair value of plan assets at end of year | 32 | 28 | 27 |
Funded status of plans (non-current) | $ (109) | $ (133) | $ (110) |
Pension - Additional Informatio
Pension - Additional Information (Details) - Pension Plan - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial gain (loss) | $ 38,000,000 | ||
Gain due to change in discount rate | 34,000,000 | ||
Gains on demographic assumptions | 3,000,000 | ||
Gains partially offset by losses on other financial assumptions | 5,000,000 | ||
Asset gains from higher actual return on plan assets | 9,000,000 | ||
Asset gains | $ 27,000,000 | ||
Fixed Income Investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Pension assets allocation targets percentage | 54.00% | ||
Global Equity Investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Pension assets allocation targets percentage | 28.00% | ||
Global Real Estate Investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Pension assets allocation targets percentage | 9.00% | ||
Cash and Other Investments | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Pension assets allocation targets percentage | 9.00% | ||
Non-U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial gain (loss) | $ 18,000,000 | $ (6,000,000) | $ (27,000,000) |
Asset gains | $ 2,000,000 | $ 0 | $ 2,000,000 |
Expected rate of return on plan assets | 2.30% | 2.70% | 2.80% |
Pension contribution | $ 3,000,000 | ||
Expected pension contribution in the next fiscal year | 3,000,000 | ||
United States | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial gain (loss) | 20,000,000 | $ (38,000,000) | $ (51,000,000) |
Asset gains | $ 25,000,000 | $ 35,000,000 | $ 70,000,000 |
Expected rate of return on plan assets | 4.70% | 5.40% | 5.70% |
Pension contribution | $ 0 | ||
Experience Gains | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial gain (loss) | 6,000,000 | ||
Experience Gains | Non-U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial gain (loss) | 4,000,000 | ||
Experience Gains | United States | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Net actuarial gain (loss) | $ 2,000,000 |
Pension - Summary of Accumulate
Pension - Summary of Accumulated Other Comprehensive (Loss) Associated with Pension Plans (Details) - Pension Plan - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
U.S. Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Prior service credit | $ (2) | $ (2) |
Net actuarial loss (gain) | 2 | 30 |
Net amount recognized | 0 | 28 |
Non-U.S. Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net actuarial loss (gain) | (2) | 14 |
Net amount recognized | $ (2) | $ 14 |
Pension - Summary of Net Period
Pension - Summary of Net Periodic Benefit (Income) Cost and Other Amounts Recognized in Comprehensive Income (Details) - Pension Plan - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | $ 7 | $ 7 | $ 5 |
Interest cost | 10 | 11 | 13 |
Expected return on plan assets | (16) | (17) | (16) |
Amortization of prior service credit | (1) | (1) | (1) |
Mark to market adjustment | 1 | ||
Other | 0 | 3 | |
Net periodic benefit cost | 0 | 3 | 2 |
Non-U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 7 | 7 | 5 |
Interest cost | 1 | 1 | 2 |
Expected return on plan assets | (1) | (1) | (1) |
Mark to market adjustment | (3) | 6 | 16 |
Other | 0 | 2 | |
Net periodic benefit cost | $ 4 | $ 13 | $ 24 |
Pension - Summary of Net Peri_2
Pension - Summary of Net Periodic Benefit (Income) Cost Other Than The Service Cost Included in Other Expense, Net (Details) - Pension Plan - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
U.S. Plans | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Actuarial losses (gains) | $ (20) | $ 38 | $ 51 | |
Excess return on plan assets | [1] | (9) | (17) | (54) |
Actuarial gains recognized during the year | 0 | (2) | ||
Other | 1 | |||
Total recognized in other comprehensive loss (income) | (28) | 19 | (3) | |
Total recognized in net periodic benefit cost and other comprehensive loss (income) | (28) | 22 | (1) | |
Non-U.S. Plans | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Actuarial losses (gains) | (18) | 6 | 26 | |
Excess return on plan assets | [1] | 0 | (1) | |
Actuarial gains recognized during the year | 3 | (6) | (17) | |
Other | (1) | 1 | ||
Total recognized in other comprehensive loss (income) | (16) | 1 | 8 | |
Total recognized in net periodic benefit cost and other comprehensive loss (income) | $ (12) | $ 14 | $ 32 | |
[1] | Represents actual return on plan assets in excess of the expected return. |
Pension - Summary of Significan
Pension - Summary of Significant Actuarial Assumptions Used in Determining Benefit Obligations and Net Periodic Benefit (Income) Cost (Details) - Pension Plan | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
U.S. Plans | |||
Actuarial assumptions used to determine benefit obligations as of December 31: | |||
Discount rate | 3.00% | 2.70% | 3.30% |
Interest crediting rate | 6.00% | 6.00% | 6.00% |
Expected annual rate of compensation increase | 3.20% | 3.50% | 3.40% |
Actuarial assumptions used to determine net periodic benefit cost for the year ended December 31: | |||
Discount rate - benefit obligation | 2.70% | 3.30% | 4.50% |
Interest crediting rate | 6.00% | 6.00% | 6.00% |
Expected rate of return on plan assets | 4.70% | 5.40% | 5.70% |
Expected annual rate of compensation increase | 3.50% | 3.40% | 3.40% |
Non-U.S. Plans | |||
Actuarial assumptions used to determine benefit obligations as of December 31: | |||
Discount rate | 1.20% | 0.70% | 1.10% |
Interest crediting rate | 1.50% | 1.50% | 1.50% |
Expected annual rate of compensation increase | 2.40% | 2.40% | 2.40% |
Actuarial assumptions used to determine net periodic benefit cost for the year ended December 31: | |||
Discount rate - benefit obligation | 0.70% | 1.10% | 2.00% |
Interest crediting rate | 1.50% | 1.50% | 1.50% |
Expected rate of return on plan assets | 2.30% | 2.70% | 2.80% |
Expected annual rate of compensation increase | 2.40% | 2.40% | 2.40% |
Pension - Summary of Amounts Re
Pension - Summary of Amounts Relate to Pension Plans with Accumulated Benefit Obligations Exceeding Fair Value of Plan Assets (Details) - Pension Plan - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
U.S. Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation | $ 3 | $ 374 |
Accumulated benefit obligation | 2 | 358 |
Fair value of plan assets | 0 | 340 |
Non-U.S. Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation | 139 | 161 |
Accumulated benefit obligation | 124 | 139 |
Fair value of plan assets | $ 31 | $ 28 |
Pension - Summary of Pension Pl
Pension - Summary of Pension Plan with Projected Benefit Obligations Exceeding Fair Value of Plan Assets (Details) - Pension Plan - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
U.S. Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation | $ 348 | $ 374 |
Accumulated benefit obligation | 337 | 358 |
Fair value of plan assets | 342 | 340 |
Non-U.S. Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Projected benefit obligation | 141 | 161 |
Accumulated benefit obligation | 125 | 139 |
Fair value of plan assets | $ 32 | $ 28 |
Pension - Summary of NAV and Fa
Pension - Summary of NAV and Fair Values of U.S. Pension Plans Assets by Asset Category (Details) - Pension Plan - U.S. Plans - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | $ 342 | $ 340 | $ 331 | $ 274 |
Cash and Cash Equivalents | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 4 | 6 | ||
Equity | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 95 | 105 | ||
Investment Funds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 16 | 14 | ||
U.S. Treasury Obligations | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 0 | 16 | ||
Government Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 39 | 41 | ||
Corporate Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 153 | 126 | ||
Real Estate / Property | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 35 | 32 | ||
Fair Value, Inputs, Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 5 | |||
Fair Value, Inputs, Level 1 | Cash and Cash Equivalents | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 5 | |||
NAV | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 342 | 335 | ||
NAV | Cash and Cash Equivalents | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 4 | 1 | ||
NAV | Equity | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 95 | 105 | ||
NAV | Investment Funds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 16 | 14 | ||
NAV | U.S. Treasury Obligations | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 0 | 16 | ||
NAV | Government Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 39 | 41 | ||
NAV | Corporate Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 153 | 126 | ||
NAV | Real Estate / Property | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | $ 35 | $ 32 |
Pension - Summary of Fair Value
Pension - Summary of Fair Values of Non-U.S. Pension Plans Assets by Asset Category (Details) - Pension Plan - Non-U.S. Plans - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | $ 32 | $ 28 | $ 27 | $ 20 |
Equity | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 1 | 1 | ||
Government Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 1 | 1 | ||
Insurance Contracts | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 10 | 10 | ||
Other | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 20 | 16 | ||
Fair Value, Inputs, Level 1 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 1 | 1 | ||
Fair Value, Inputs, Level 1 | Equity | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 1 | 1 | ||
Fair Value, Inputs, Level 2 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 1 | 1 | ||
Fair Value, Inputs, Level 2 | Government Bonds | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 1 | 1 | ||
Fair Value, Inputs, Level 3 | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 30 | 26 | $ 24 | $ 6 |
Fair Value, Inputs, Level 3 | Insurance Contracts | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | 10 | 10 | ||
Fair Value, Inputs, Level 3 | Other | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of pension plan assets | $ 20 | $ 16 |
Pension - Summary of Changes in
Pension - Summary of Changes in Fair Value of Level 3 Assets for Non-U.S (Details) - Pension Plan - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Actual return on plan assets | $ 27 | ||
Non-U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets at beginning of year | 28 | $ 27 | $ 20 |
Actual return on plan assets | 2 | 0 | 2 |
Fair value of plan assets at end of year | 32 | 28 | 27 |
Fair Value, Inputs, Level 3 | Non-U.S. Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets at beginning of year | $ 26 | $ 24 | 6 |
Defined Benefit Plan, Plan Assets, Fair Value by Hierarchy and NAV [Extensible List] | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | |
Actual return on plan assets | $ 1 | 2 | |
Purchases, sales and settlements, net | 4 | (1) | 15 |
Other | (1) | 3 | 1 |
Fair value of plan assets at end of year | $ 30 | $ 26 | $ 24 |
Defined Benefit Plan, Plan Assets, Fair Value by Hierarchy and NAV [Extensible List] | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 |
Pension - Summary of Benefit Pa
Pension - Summary of Benefit Payments (Details) - Pension Plan $ in Millions | Dec. 31, 2021USD ($) |
U.S. Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
2022 | $ 15 |
2023 | 15 |
2024 | 16 |
2025 | 17 |
2026 | 18 |
2027-2031 | 96 |
Non-U.S. Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
2022 | 3 |
2023 | 2 |
2024 | 3 |
2025 | 3 |
2026 | 3 |
2027-2031 | $ 23 |
Geographic Areas - Financial _3
Geographic Areas - Financial Data - Schedule of Geographic Areas (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | $ 5,846 | $ 5,071 | $ 4,988 |
Long-lived Assets | [2] | 429 | 451 | 453 |
United States | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | 4,181 | 3,543 | 3,423 |
Long-lived Assets | [2] | 244 | 260 | 272 |
Europe | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | 1,196 | 1,121 | 1,117 |
Long-lived Assets | [2] | 139 | 144 | 136 |
Other International | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | 469 | 407 | 448 |
Long-lived Assets | [2] | $ 46 | $ 47 | $ 45 |
[1] | Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. | |||
[2] | Long-lived assets are comprised of Property, plant and equipment – net and lease right-of-use assets. |
Geographic Areas - Financial _4
Geographic Areas - Financial Data - Schedule of Geographic Areas (Parenthetical) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | $ 5,846 | $ 5,071 | $ 4,988 |
United States | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | 4,181 | 3,543 | 3,423 |
United States | Export Sales | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | 26 | 21 | 27 | |
Europe | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | 1,196 | 1,121 | 1,117 |
Other International | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Net revenue | [1] | $ 469 | $ 407 | $ 448 |
[1] | Revenue between geographic areas approximate market and is not significant. Net revenue is classified according to their country of origin. Included in United States net revenue are export sales of $ 26 million, $ 21 million and $ 27 million in 2021, 2020 and 2019 , respectively. |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - First Alert, Inc. - USD ($) $ in Millions | Apr. 02, 2022 | Feb. 06, 2022 |
Scenario Forecast | Capital Stock | ||
Subsequent Event [Line Items] | ||
Base purchase price payable upon closing of acquisition | $ 593 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Equity purchase agreement date | Feb. 6, 2022 | |
Subsequent Event | Capital Stock | ||
Subsequent Event [Line Items] | ||
Percentage of capital stock acquired | 100.00% |