Textron (TXT) 10-Q 24 Apr 19 2019 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 30, 2019	Apr. 12, 2019
Document and Entity Information
Entity Registrant Name	TEXTRON INC
Entity Central Index Key	0000217346
Document Type	10-Q
Document Period End Date	Mar. 30, 2019
Amendment Flag	false
Current Fiscal Year End Date	--01-04
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		232,762,261
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Revenues
Total revenues	$ 3,109	$ 3,296
Costs, expenses and other
Cost of sales	2,577	2,729
Selling and administrative expense	307	327
Interest expense	42	41
Non-service components of pension and post-retirement income, net	(29)	(19)
Total costs, expenses and other	2,897	3,078
Income before income taxes	212	218
Income tax expense	33	29
Net income	$ 179	$ 189
Earnings per share
Basic (in dollars per share)	$ 0.76	$ 0.73
Diluted (in dollars per share)	$ 0.76	$ 0.72
Manufacturing
Revenues
Total revenues	$ 3,092	$ 3,280
Finance.
Revenues
Finance Revenue	$ 17	$ 16

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Consolidated Statements of Comprehensive Income
Net income	$ 179	$ 189
Other comprehensive income (loss), net of tax:
Pension and postretirement benefits adjustments, net of reclassifications	21	31
Foreign currency translation adjustments	3	42
Deferred gains on hedge contracts, net of reclassifications	2	1
Other comprehensive income	26	74
Comprehensive income	$ 205	$ 263

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Assets
Inventories	$ 4,047	$ 3,818
Finance receivables, net	756	760
Total assets	14,480	14,264
Liabilities
Total liabilities	9,247	9,072
Shareholders' equity
Common stock	30	30
Capital surplus	1,689	1,646
Treasury stock	(331)	(129)
Retained earnings	5,581	5,407
Accumulated other comprehensive loss	(1,736)	(1,762)
Total shareholders' equity	5,233	5,192
Total liabilities and shareholders' equity	$ 14,480	$ 14,264
Common shares outstanding	232,699	235,621
Manufacturing group
Assets
Cash and equivalents	$ 646	$ 987
Accounts receivable, net	1,059	1,024
Inventories	4,047	3,818
Other current assets	835	785
Total current assets	6,587	6,614
Property, plant and equipment, less accumulated depreciation and amortization of $4,256 and $4,203, respectively	2,523	2,615
Goodwill	2,141	2,218
Other assets	2,267	1,800
Total assets	13,518	13,247
Liabilities
Short-term debt and current portion of long-term debt	363	258
Accounts payable	1,147	1,099
Other current liabilities	1,922	2,149
Total current liabilities	3,432	3,506
Other liabilities	2,186	1,932
Long-term debt	2,812	2,808
Total liabilities	8,430	8,246
Finance group
Assets
Cash and equivalents	96	120
Finance receivables, net	756	760
Other assets	110	137
Total assets	962	1,017
Liabilities
Other liabilities	106	108
Debt	711	718
Total liabilities	$ 817	$ 826

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Consolidated Balance Sheets
Accumulated depreciation and amortization	$ 4,256	$ 4,203

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Cash flows from operating activities
Net income	$ 179	$ 189
Non-cash items:
Depreciation and amortization	102	105
Deferred income taxes	15	2
Other, net	33	32
Changes in assets and liabilities:
Accounts receivable, net	(33)	63
Inventories	(215)	(128)
Other assets	(31)	(119)
Accounts payable	47	15
Other liabilities	(288)	(263)
Income taxes, net	(7)	9
Pension, net	(14)	(2)
Captive finance receivables, net	(1)	15
Other operating activities, net	(3)	(3)
Net cash provided by (used in) operating activities	(216)	(85)
Cash flows from investing activities
Capital expenditures	(59)	(77)
Net proceeds from corporate-owned life insurance policies	2	58
Finance receivables repaid	12	16
Other investing activities, net	3	9
Net cash provided by (used in) investing activities	(42)	6
Cash flows from financing activities
Increase in short-term debt	100	2
Principal payments on long-term debt and nonrecourse debt	(19)	(19)
Purchases of Textron common stock	(202)	(344)
Dividends paid	(5)	(5)
Other financing activities, net	10	8
Net cash used in financing activities	(116)	(358)
Effect of exchange rate changes on cash and equivalents	9	11
Net decrease in cash and equivalents	(365)	(426)
Cash and equivalents at beginning of period	1,107	1,262
Cash and equivalents at end of period	742	836
Manufacturing group
Cash flows from operating activities
Net income	175	179
Non-cash items:
Depreciation and amortization	100	103
Deferred income taxes	15	2
Other, net	33	32
Changes in assets and liabilities:
Accounts receivable, net	(33)	63
Inventories	(241)	(128)
Other assets	(30)	(118)
Accounts payable	47	15
Other liabilities	(286)	(259)
Income taxes, net	(9)	13
Pension, net	(14)	(2)
Dividends received from Finance group	50	50
Other operating activities, net	(3)	(3)
Net cash provided by (used in) operating activities	(196)	(53)
Cash flows from investing activities
Capital expenditures	(59)	(77)
Net proceeds from corporate-owned life insurance policies	2	58
Other investing activities, net	1	9
Net cash provided by (used in) investing activities	(56)	(10)
Cash flows from financing activities
Increase in short-term debt	100	2
Purchases of Textron common stock	(202)	(344)
Dividends paid	(5)	(5)
Other financing activities, net	9	8
Net cash used in financing activities	(98)	(339)
Effect of exchange rate changes on cash and equivalents	9	11
Net decrease in cash and equivalents	(341)	(391)
Cash and equivalents at beginning of period	987	1,079
Cash and equivalents at end of period	646	688
Finance group
Cash flows from operating activities
Net income	4	10
Non-cash items:
Depreciation and amortization	2	2
Changes in assets and liabilities:
Other assets	(1)	(1)
Other liabilities	(2)	(4)
Income taxes, net	2	(4)
Net cash provided by (used in) operating activities	5	3
Cash flows from investing activities
Finance receivables repaid	40	65
Finance receivables originated	(29)	(34)
Other investing activities, net	28
Net cash provided by (used in) investing activities	39	31
Cash flows from financing activities
Principal payments on long-term debt and nonrecourse debt	(18)	(19)
Dividends paid	(50)	(50)
Net cash used in financing activities	(68)	(69)
Net decrease in cash and equivalents	(24)	(35)
Cash and equivalents at beginning of period	120	183
Cash and equivalents at end of period	$ 96	$ 148

Basis of Presentation

Basis of Presentation	3 Months Ended
	Mar. 30, 2019
Basis of Presentation
Basis of Presentation	Note 1. Basis of Presentation Our Consolidated Financial Statements include the accounts of Textron Inc. (Textron) and its majority-owned subsidiaries. We have prepared these unaudited consolidated financial statements in accordance with accounting principles generally accepted in the U.S. for interim financial information. Accordingly, these interim financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the U.S. for complete financial statements. The consolidated interim financial statements included in this quarterly report should be read in conjunction with the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 29, 2018. In the opinion of management, the interim financial statements reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for the fair presentation of our consolidated financial position, results of operations and cash flows for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. Our financings are conducted through two separate borrowing groups. The Manufacturing group consists of Textron consolidated with its majority-owned subsidiaries that operate in the Textron Aviation, Bell, Textron Systems and Industrial segments. The Finance group, which also is the Finance segment, consists of Textron Financial Corporation and its consolidated subsidiaries. We designed this framework to enhance our borrowing power by separating the Finance group. Our Manufacturing group operations include the development, production and delivery of tangible goods and services, while our Finance group provides financial services. Due to the fundamental differences between each borrowing group’s activities, investors, rating agencies and analysts use different measures to evaluate each group’s performance. To support those evaluations, we present balance sheet and cash flow information for each borrowing group within the Consolidated Financial Statements. All significant intercompany transactions are eliminated from the Consolidated Financial Statements, including retail financing activities for inventory sold by our Manufacturing group and financed by our Finance group. Use of Estimates We prepare our financial statements in conformity with generally accepted accounting principles, which require us to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Our estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the Consolidated Statements of Operations in the period that they are determined. Contract Estimates For contracts where revenue is recognized over time, we recognize changes in estimated contract revenues, costs and profits using the cumulative catch-up method of accounting. This method recognizes the cumulative effect of changes on current and prior periods with the impact of the change from inception-to-date recorded in the current period. Anticipated losses on contracts are recognized in full in the period in which the losses become probable and estimable. In the first quarter of 2019 and 2018, our cumulative catch-up adjustments increased revenue and segment profit by $31 million and $40 million, respectively, and net income by $23 million and $30 million, respectively ($0.10 and $0.12 per diluted share, respectively). In the first quarter of 2019 and 2018, gross favorable adjustments totaled $53 million and $56 million, respectively, and the gross unfavorable adjustments totaled $22 million and $16 million, respectively.

Summary of Significant Accounti

Summary of Significant Accounting Policies Update	3 Months Ended
	Mar. 30, 2019
Summary of Significant Accounting Policies Update
Summary of Significant Accounting Policies Update	Note 2. Summary of Significant Accounting Policies Update At the beginning of 2019, we adopted Accounting Standards Update (ASU) No. 2016-02, Leases (ASC 842), which requires lessees to recognize all leases with a term greater than 12 months on the balance sheet as right-of-use assets and lease liabilities . Upon adoption, the most significant impact was the recognition of $307 million in right-of-use assets and lease liabilities for operating leases, while our accounting for finance leases remained unchanged. We applied the provisions of this standard to our existing leases at the adoption date using a retrospective transition method and have not adjusted comparative periods. The cumulative transition adjustment to retained earnings was not significant and the adoption had no impact on our earnings or cash flows. We elected the practical expedients permitted under the transition guidance, which allowed us to carryforward the historical lease classification and to apply hindsight when evaluating options within a contract, resulting in the extension of the lease term for certain of our existing leases. Our significant accounting policies are included in Note 1 of our Annual Report on Form 10-K for the year ended December 29, 2018. Significant changes to our policies resulting from the adoption of ASC 842 are provided below. Leases We identify leases by evaluating our contracts to determine if the contract conveys the right to use an identified asset for a stated period of time in exchange for consideration. Specifically, we consider whether we can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the asset. For our contracts that contain both lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs, other goods/services), we allocate the consideration in the contract to each component based on its standalone price. Leases with terms greater than 12 months are classified as either operating or finance leases at the commencement date. For these leases, we capitalize the lesser of a) the present value of the minimum lease payments over the lease term, or b) the fair value of the asset, as a right-of-use asset with an offsetting lease liability. The discount rate used to calculate the present value of the minimum lease payments is typically our incremental borrowing rate, as the rate implicit in the lease is generally not known or determinable. The lease term includes any noncancelable period for which we have the right to use the asset and may include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating leases are recognized as a single lease cost on a straight-line basis over the lease term, while finance lease cost is recognized separately as amortization and interest expense. Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses. For most financial assets, such as trade and other receivables, loans and other instruments, this standard changes the current incurred loss model to a forward-looking expected credit loss model, which generally will result in the earlier recognition of allowances for losses. The new standard is effective for our company at the beginning of 2020. Entities are required to apply the provisions of the standard through a cumulative-effect adjustment to retained earnings as of the effective date. We are currently evaluating the impact of the standard on our consolidated financial statements.

Accounts Receivable and Finance

Accounts Receivable and Finance Receivables	3 Months Ended
	Mar. 30, 2019
Accounts Receivable and Finance Receivables
Accounts Receivable and Finance Receivables	Note 3. Accounts Receivable and Finance Receivables Accounts Receivable Accounts receivable is composed of the following: (In millions) March 30, December 29, Commercial $ $ U.S. Government contracts Allowance for doubtful accounts Total $ $ Finance Receivables Finance receivables are presented in the following table: (In millions) March 30, 2019 December 29, 2018 Finance receivables $ $ Allowance for losses Total finance receivables, net $ $ Finance Receivable Portfolio Quality We internally assess the quality of our finance receivables based on a number of key credit quality indicators and statistics such as delinquency, loan balance to estimated collateral value and the financial strength of individual borrowers and guarantors. Because many of these indicators are difficult to apply across an entire class of receivables, we evaluate individual loans on a quarterly basis and classify these loans into three categories based on the key credit quality indicators for the individual loan. These three categories are performing, watchlist and nonaccrual. We classify finance receivables as nonaccrual if credit quality indicators suggest full collection of principal and interest is doubtful. In addition, we automatically classify accounts as nonaccrual once they are contractually delinquent by more than three months unless collection of principal and interest is not doubtful. Accounts are classified as watchlist when credit quality indicators have deteriorated as compared with typical underwriting criteria, and we believe collection of full principal and interest is probable but not certain. All other finance receivables that do not meet the watchlist or nonaccrual categories are classified as performing. We measure delinquency based on the contractual payment terms of our finance receivables. In determining the delinquency aging category of an account, any/all principal and interest received is applied to the most past-due principal and/or interest amounts due. If a significant portion of the contractually due payment is delinquent, the entire finance receivable balance is reported in accordance with the most past-due delinquency aging category. Finance receivables categorized based on the credit quality indicators and by the delinquency aging category are summarized as follows: (Dollars in millions) March 30, 2019 December 29, 2018 Performing $ $ Watchlist Nonaccrual Nonaccrual as a percentage of finance receivables Less than 31 days past due $ $ 31-60 days past due 61-90 days past due Over 90 days past due 60+ days contractual delinquency as a percentage of finance receivables On a quarterly basis, we evaluate individual larger balance accounts for impairment. A finance receivable is considered impaired when it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan agreement based on our review of the credit quality indicators described above. Impaired finance receivables include both nonaccrual accounts and accounts for which full collection of principal and interest remains probable, but the account’s original terms have been, or are expected to be, significantly modified. If the modification specifies an interest rate equal to or greater than a market rate for a finance receivable with comparable risk, the account is not considered impaired in years subsequent to the modification. A summary of finance receivables and the allowance for losses, based on the results of our impairment evaluation, is provided below. The finance receivables included in this table specifically exclude leveraged leases in accordance with U.S. generally accepted accounting principles. (In millions) March 30, 2019 December 29, 2018 Finance receivables evaluated collectively $ $ Finance receivables evaluated individually Allowance for losses based on collective evaluation Allowance for losses based on individual evaluation Impaired finance receivables with no related allowance for losses $ $ Impaired finance receivables with related allowance for losses Unpaid principal balance on impaired finance receivables Average recorded investment of impaired finance receivables

Inventories

Inventories	3 Months Ended
	Mar. 30, 2019
Inventories
Inventories	Note 4. Inventories Inventories are composed of the following: (In millions) March 30, 2019 December 29, Finished goods $ $ Work in process Raw materials and components Total $ $

Other Assets

Other Assets	3 Months Ended
	Mar. 30, 2019
Other Assets
Other Assets	Note 5. Other Assets On April 1, 2019, Textron Systems’ TRU Simulation + Training Inc. contributed assets associated with its training business into FlightSafety Textron Aviation Training LLC, a company formed by FlightSafety International Inc. and TRU to provide training solutions for Textron Aviation’s business and general aviation aircraft. Our 30% investment in this newly formed company will be accounted for under the equity method of accounting. The assets of the training business met the criteria to be classified as held for sale at March 30, 2019 and were reclassified to Other assets in the Consolidated Balance Sheets at their net carrying value of $145 million, primarily property, plant and equipment of $64 million and allocated goodwill of $77 million.

Warranty Liability

Warranty Liability	3 Months Ended
	Mar. 30, 2019
Warranty Liability
Warranty Liability	Note 6. Warranty Liability Changes in our warranty liability are as follows: Three Months Ended (In millions) March 30, March 31, Beginning of period $ $ Provision Settlements Adjustments* End of period $ $ * Adjustments include changes to prior year estimates, new issues on prior year sales, acquisitions and currency translation adjustments.

Leases

Leases	3 Months Ended
	Mar. 30, 2019
Leases
Leases	Note 7. Leases We primarily lease certain manufacturing plants, offices, warehouses, training and service centers at various locations worldwide that are classified as either operating or finance leases. Our leases have remaining lease terms up to 30 years, which include options to extend the lease term for periods up to 25 years when it is reasonably certain the option will be exercised. In the first quarter of 2019, our operating lease cost totaled $16 million. Our finance lease cost and our variable and short-term lease costs were not significant. In the first quarter of 2019, cash paid for operating lease liabilities totaled $16 million, which is classified in cash flows from operating activities. Balance sheet and other information related to our leases is as follows: (Dollars in millions) March 30, Operating leases: Other assets $ Other current liabilities Other liabilities Finance leases: Property, plant and equipment, less accumulated amortization of $50 million $ Short-term and current portion of long-term debt Long-term debt Weighted-average remaining lease term (in years) Finance leases Operating leases Weighted-average discount rate Finance leases Operating leases Maturities of our lease liabilities at March 30, 2019 are as follows: (In millions) Operating Finance Leases 2019 $ $ 2020 2021 2022 2023 Thereafter Total lease payments Less: interest Total lease liabilities $ $

Derivative Instruments and Fair

Derivative Instruments and Fair Value Measurements	3 Months Ended
	Mar. 30, 2019
Derivative Instruments and Fair Value Measurements
Derivative Instruments and Fair Value Measurements	Note 8. Derivative Instruments and Fair Value Measurements We measure fair value at 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. We prioritize the assumptions that market participants would use in pricing the asset or liability into a three-tier fair value hierarchy. This fair value hierarchy gives the highest priority (Level 1) to quoted prices in active markets for identical assets or liabilities and the lowest priority (Level 3) to unobservable inputs in which little or no market data exist, requiring companies to develop their own assumptions. Observable inputs that do not meet the criteria of Level 1, which include quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets and liabilities in markets that are not active, are categorized as Level 2. Level 3 inputs are those that reflect our estimates about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. Valuation techniques for assets and liabilities measured using Level 3 inputs may include methodologies such as the market approach, the income approach or the cost approach and may use unobservable inputs such as projections, estimates and management’s interpretation of current market data. These unobservable inputs are utilized only to the extent that observable inputs are not available or cost effective to obtain. Assets and Liabilities Recorded at Fair Value on a Recurring Basis We manufacture and sell our products in a number of countries throughout the world, and, therefore, we are exposed to movements in foreign currency exchange rates. We primarily utilize foreign currency exchange contracts with maturities of no more than three years to manage this volatility. These contracts qualify as cash flow hedges and are intended to offset the effect of exchange rate fluctuations on forecasted sales, inventory purchases and overhead expenses. Net gains and losses recognized in earnings and Accumulated other comprehensive loss on cash flow hedges, including gains and losses related to hedge ineffectiveness, were not significant in the periods presented. Our foreign currency exchange contracts are measured at fair value using the market method valuation technique. The inputs to this technique utilize current foreign currency exchange forward market rates published by third-party leading financial news and data providers. These are observable data that represent the rates that the financial institution uses for contracts entered into at that date; however, they are not based on actual transactions so they are classified as Level 2. At March 30, 2019 and December 29, 2018, we had foreign currency exchange contracts with notional amounts upon which the contracts were based of $489 million and $379 million, respectively. At March 30, 2019, the fair value amounts of our foreign currency exchange contracts were a $4 million asset and a $7 million liability. At December 29, 2018, the fair value amounts of our foreign currency exchange contracts were a $2 million asset and a $10 million liability. We hedge our net investment position in certain major currencies and generate foreign currency interest payments that offset other transactional exposures in these currencies. To accomplish this, we borrow directly in the foreign currency and designate a portion of the debt as a hedge of the net investment. We record changes in the fair value of these contracts in other comprehensive income to the extent they are effective as cash flow hedges. Currency effects on the effective portion of these hedges, which are reflected in the foreign currency translation adjustments within Accumulated other comprehensive loss, were not significant in the periods presented. Assets and Liabilities Not Recorded at Fair Value The carrying value and estimated fair value of our financial instruments that are not reflected in the financial statements at fair value are as follows: March 30, 2019 December 29, 2018 (In millions) Carrying Estimated Carrying Estimated Fair Value Manufacturing group Debt, excluding leases $ $ $ $ Finance group Finance receivables, excluding leases Debt Fair value for the Manufacturing group debt is determined using market observable data for similar transactions (Level 2). The fair value for the Finance group debt was determined primarily based on discounted cash flow analyses using observable market inputs from debt with similar duration, subordination and credit default expectations (Level 2). Fair value estimates for finance receivables were determined based on internally developed discounted cash flow models primarily utilizing significant unobservable inputs (Level 3), which include estimates of the rate of return, financing cost, capital structure and/or discount rate expectations of current market participants combined with estimated loan cash flows based on credit losses, payment rates and expectations of borrowers’ ability to make payments on a timely basis.

Shareholders' Equity

Shareholders' Equity	3 Months Ended
	Mar. 30, 2019
Shareholders' Equity
Shareholders' Equity	Note 9. Shareholders’ Equity A reconciliation of Shareholder’s equity is presented below: (In millions) Common Capital Treasury Stock Retained Accumulated Comprehensive Loss Total Balance at December 29, 2018 $ $ $ $ $ $ Net income — — — — Other comprehensive income — — — — Share-based compensation activity — — — — Dividends declared — — — — Purchases of common stock — — — — Balance at March 30, 2019 $ $ $ $ $ $ Balance at December 30, 2017 $ $ $ $ $ $ Adoption of ASC 606 — — — — Net income — — — — Other comprehensive income — — — — Share-based compensation activity — — — — Dividends declared — — — — Purchases of common stock — — — — Balance at March 31, 2018 $ $ $ $ $ $ Dividends per share of common stock were $0.02 for both the three months ended March 30, 2019 and March 31, 2018. Earnings Per Share We calculate basic and diluted earnings per share (EPS) based on net income, which approximates income available to common shareholders for each period. Basic EPS is calculated using the two-class method, which includes the weighted-average number of common shares outstanding during the period and restricted stock units to be paid in stock that are deemed participating securities as they provide nonforfeitable rights to dividends. Diluted EPS considers the dilutive effect of all potential future common stock, including stock options. The weighted-average shares outstanding for basic and diluted EPS are as follows: Three Months Ended (In thousands) March 30, 2019 March 31, 2018 Basic weighted-average shares outstanding Dilutive effect of stock options Diluted weighted-average shares outstanding Stock options to purchase 3.1 million and 1.3 million shares of common stock are excluded from the calculation of diluted weighted-average shares outstanding for the first quarter of 2019 and 2018, respectively, as their effect would have been anti-dilutive. Accumulated Other Comprehensive Loss and Other Comprehensive Income The components of Accumulated other comprehensive loss are presented below: (In millions) Pension and Foreign Deferred Gains (Losses) Accumulated Balance at December 29, 2018 $ $ $ $ Other comprehensive income before reclassifications — Reclassified from Accumulated other comprehensive loss — Balance at March 30, 2019 $ $ $ $ Balance at December 30, 2017 $ $ $ $ Other comprehensive income before reclassifications — Reclassified from Accumulated other comprehensive loss — — Balance at March 31, 2018 $ $ $ $ The before and after-tax components of Other comprehensive income are presented below: March 30, 2019 March 31, 2018 (In millions) Pre-Tax Tax (Expense) After-Tax Pre-Tax Tax (Expense) After-Tax Three Months Ended Pension and postretirement benefits adjustments: Amortization of net actuarial loss* $ $ $ $ $ $ Amortization of prior service cost* — — Pension and postretirement benefits adjustments, net Deferred gains on hedge contracts: Current deferrals Reclassification adjustments — — — — Deferred gains on hedge contracts, net Foreign currency translation adjustments Total $ $ $ $ $ $ *These components of other comprehensive income are included in the computation of net periodic pension cost. See Note 14 of our 2018 Annual Report on Form 10-K for additional information.

Segment Information

Segment Information	3 Months Ended
	Mar. 30, 2019
Segment Information
Segment Information	Note 10. Segment Information We operate in, and report financial information for, the following five business segments: Textron Aviation, Bell, Textron Systems, Industrial and Finance. On July 2, 2018, we sold our Tools and Test Equipment businesses that were previously included in the Industrial segment as discussed in Note 2 of our 2018 Annual Report on Form 10-K. Segment profit is an important measure used for evaluating performance and for decision-making purposes. Segment profit for the manufacturing segments excludes interest expense, certain corporate expenses, gains/losses on major business dispositions and special charges. The measurement for the Finance segment includes interest income and expense along with intercompany interest income and expense. Our revenues by segment, along with a reconciliation of segment profit to income before income taxes, are included in the table below: Three Months Ended (In millions) March 30, 2019 March 31, 2018 Revenues Textron Aviation $ $ Bell Textron Systems Industrial Finance Total revenues $ $ Segment Profit Textron Aviation $ $ Bell Textron Systems Industrial Finance Segment profit Corporate expenses and other, net Interest expense, net for Manufacturing group Income before income taxes $ $

Revenues

Revenues	3 Months Ended
	Mar. 30, 2019
Revenues
Revenues	Note 11. Revenues Disaggregation of Revenues Our revenues disaggregated by major product type are presented below: Three Months Ended (In millions) March 30, 2019 March 31, 2018 Aircraft $ $ Aftermarket parts and services Textron Aviation Military aircraft and support programs Commercial helicopters, parts and services Bell Unmanned systems Marine and land systems Simulation, training and other Textron Systems Fuel systems and functional components Specialized vehicles Tools and test equipment — Industrial Finance Total revenues $ $ Our revenues for our segments by customer type and geographic location are presented below: (In millions) Textron Bell Textron Industrial Finance Total Three months ended March 30, 2019 Customer type: Commercial $ $ $ $ $ $ U.S. Government — Total revenues $ $ $ $ $ $ Geographic location: United States $ $ $ $ $ $ Europe Asia and Australia Other international Total revenues $ $ $ $ $ $ Three months ended March 31, 2018 Customer type: Commercial $ $ $ $ $ $ U.S. Government — Total revenues $ $ $ $ $ $ Geographic location: United States $ $ $ $ $ $ Europe Asia and Australia Other international Total revenues $ $ $ $ $ $ Remaining Performance Obligations Our remaining performance obligations, which is the equivalent of our backlog, represent the expected transaction price allocated to our contracts that we expect to recognize as revenue in future periods when we perform under the contracts. These remaining obligations exclude unexercised contract options and potential orders under ordering-type contracts such as Indefinite Delivery, Indefinite Quantity contracts. At March 30, 2019, we had $9.7 billion in remaining performance obligations of which we expect to recognize revenues of approximately 70% through 2020, an additional 23% through 2022, and the balance thereafter. Contract Assets and Liabilities Assets and liabilities related to our contracts with customers are reported on a contract-by-contract basis at the end of each reporting period. At March 30, 2019, contract assets and contract liabilities totaled $477 million and $927 million, respectively. At December 29, 2018, contract assets and contract liabilities totaled $461 million and $974 million, respectively. During the first quarter of 2019, we recognized $311 million in revenues that were included in the contract liability balance at December 29, 2018. We recognized $322 million in revenues in the first quarter of 2018 that were included in the contract liability balance at the adoption date.

Share-Based Compensation

Share-Based Compensation	3 Months Ended
	Mar. 30, 2019
Share-Based Compensation
Share-Based Compensation	Note 12. Share-Based Compensation Under our share-based compensation plans, we have authorization to provide awards to selected employees in the form of stock options, restricted stock, restricted stock units, stock appreciation rights, performance stock, performance share units and other awards. Share-based compensation expense for awards subject only to service conditions vest ratably and is recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award. For e mployees eligible for early retirement under the plans, the service requirement of the award is satisfied at the date of grant and the expense is recognized in the period the award is granted. Compensation expense included in net income for these plans is as follows: Three Months Ended (In millions) March 30, March 31, Compensation expense $ $ Income tax benefit Total net compensation expense included in net income $ $ Stock Options Options to purchase our shares have a maximum term of ten years and vest ratably over a three-year period. Stock option compensation cost is calculated under the fair value approach using the Black-Scholes option-pricing model to determine the fair value of options granted on the date of grant. The expected volatility used in this model is based on implied volatilities from traded options on our common stock, historical volatilities and other factors. The expected term is based on historical option exercise data, which is adjusted to reflect any anticipated changes in expected behavior. The weighted-average fair value of options granted and the assumptions used in our option-pricing model for such grants are as follows: Three Months Ended March 30, March 31, Fair value of options at grant date $ $ Dividend yield Expected volatility Risk-free interest rate Expected term (in years) The stock option activity during the first quarter of 2019 is provided below: (Options in thousands) Number of Weighted- Outstanding at beginning of period $ Granted Exercised Forfeited or expired Outstanding at end of period $ Exercisable at end of period $ At March 30, 2019 , our outstanding options had an aggregate intrinsic value of $80 million and a weighted-average remaining contractual life of six years. Our exercisable options had an aggregate intrinsic value of $79 million and a weighted-average remaining contractual life of five years at March 30, 2019 . The total intrinsic value of options exercised was $16 million and $8 million during the first quarter of 2019 and 2018, respectively. Restricted Stock Units The activity for restricted stock units payable in both stock and cash during the first quarter of 2019 is provided below: Units Payable in Stock Units Payable in Cash (Shares/Units in thousands) Number of Weighted- Number of Weighted- Outstanding at beginning of period, nonvested $ $ Granted Vested Forfeited — — Outstanding at end of period, nonvested $ $ The fair value of the restricted stock unit awards that vested and/or amounts paid under these awards is as follows: Three Months Ended (In millions) March 30, March 31, Fair value of awards vested $ $ Cash paid Performance Share Units The activity for our performance share units during the first quarter of 2019 is provided below: (Units in thousands) Number of Weighted- Outstanding at beginning of period, nonvested $ Granted Outstanding at end of period, nonvested $ Cash paid under these awards totaled $10 million and $11 million during the first quarter of 2019 and 2018, respectively.

Retirement Plans

Retirement Plans	3 Months Ended
	Mar. 30, 2019
Retirement Plans
Retirement Plans	Note 13. Retirement Plans We provide defined benefit pension plans and other postretirement benefits to eligible employees. The components of net periodic benefit cost (credit) for these plans are as follows: Pension Benefits Postretirement Benefits (In millions) March 30, March 31, March 30, March 31, Three Months Ended Service cost $ $ $ $ Interest cost Expected return on plan assets — — Amortization of prior service cost (credit) Amortization of net actuarial loss — — Net periodic benefit cost (credit) $ $ 7 $ $

Income Taxes

Income Taxes	3 Months Ended
	Mar. 30, 2019
Income Taxes
Income Taxes	Note 14. Income Taxes Our effective tax rate for the first quarter of 2019 and 2018 was 15.6% and 13.3%, respectively. In the first quarter of 2019, the effective tax rate was lower than the U.S. federal statutory tax rate of 21%, primarily due to a $12 million benefit recognized for additional research credits related to prior years. In the first quarter of 2018, the effective tax rate was lower than the U.S. federal statutory tax rate of 21%, primarily due to benefits recognized from audit settlements. Our reserve for unrecognized tax benefits totaled $175 million and $141 million at March 30, 2019 and December 29, 2018, respectively. The increase in this reserve largely reflects a claim filed in the first quarter of 2019 for tax credits related to prior years.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 30, 2019
Commitments and Contingencies
Commitments and Contingencies	Note 15. Commitments and Contingencies We are subject to legal proceedings and other claims arising out of the conduct of our business, including proceedings and claims relating to commercial and financial transactions; government contracts; alleged lack of compliance with applicable laws and regulations; production partners; product liability; patent and trademark infringement; employment disputes; and environmental, safety and health matters. Some of these legal proceedings and claims seek damages, fines or penalties in substantial amounts or remediation of environmental contamination. As a government contractor, we are subject to audits, reviews and investigations to determine whether our operations are being conducted in accordance with applicable regulatory requirements. Under federal government procurement regulations, certain claims brought by the U.S. Government could result in our suspension or debarment from U.S. Government contracting for a period of time. On the basis of information presently available, we do not believe that existing proceedings and claims will have a material effect on our financial position or results of operations.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies Update (Policies)	3 Months Ended
	Mar. 30, 2019
Summary of Significant Accounting Policies Update
Leases	Leases We identify leases by evaluating our contracts to determine if the contract conveys the right to use an identified asset for a stated period of time in exchange for consideration. Specifically, we consider whether we can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the asset. For our contracts that contain both lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs, other goods/services), we allocate the consideration in the contract to each component based on its standalone price. Leases with terms greater than 12 months are classified as either operating or finance leases at the commencement date. For these leases, we capitalize the lesser of a) the present value of the minimum lease payments over the lease term, or b) the fair value of the asset, as a right-of-use asset with an offsetting lease liability. The discount rate used to calculate the present value of the minimum lease payments is typically our incremental borrowing rate, as the rate implicit in the lease is generally not known or determinable. The lease term includes any noncancelable period for which we have the right to use the asset and may include options to extend or terminate the lease when it is reasonably certain that we will exercise the option. Operating leases are recognized as a single lease cost on a straight-line basis over the lease term, while finance lease cost is recognized separately as amortization and interest expense.
Accounting Pronouncements Not Yet Adopted	Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses. For most financial assets, such as trade and other receivables, loans and other instruments, this standard changes the current incurred loss model to a forward-looking expected credit loss model, which generally will result in the earlier recognition of allowances for losses. The new standard is effective for our company at the beginning of 2020. Entities are required to apply the provisions of the standard through a cumulative-effect adjustment to retained earnings as of the effective date. We are currently evaluating the impact of the standard on our consolidated financial statements.

Accounts Receivable and Finan_2

Accounts Receivable and Finance Receivables (Tables)	3 Months Ended
	Mar. 30, 2019
Accounts Receivable and Finance Receivables
Accounts receivable	(In millions) March 30, December 29, Commercial $ $ U.S. Government contracts Allowance for doubtful accounts Total $ $
Finance receivables	(In millions) March 30, 2019 December 29, 2018 Finance receivables $ $ Allowance for losses Total finance receivables, net $ $
Finance receivables by credit quality indicator and by delinquency aging category	(Dollars in millions) March 30, 2019 December 29, 2018 Performing $ $ Watchlist Nonaccrual Nonaccrual as a percentage of finance receivables Less than 31 days past due $ $ 31-60 days past due 61-90 days past due Over 90 days past due 60+ days contractual delinquency as a percentage of finance receivables
Summary of finance receivables and allowance for loan losses based on impairment evaluation, excluding leveraged leases	(In millions) March 30, 2019 December 29, 2018 Finance receivables evaluated collectively $ $ Finance receivables evaluated individually Allowance for losses based on collective evaluation Allowance for losses based on individual evaluation Impaired finance receivables with no related allowance for losses $ $ Impaired finance receivables with related allowance for losses Unpaid principal balance on impaired finance receivables Average recorded investment of impaired finance receivables

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Mar. 30, 2019
Inventories
Inventories	(In millions) March 30, 2019 December 29, Finished goods $ $ Work in process Raw materials and components Total $ $

Warranty Liability (Tables)

Warranty Liability (Tables)	3 Months Ended
	Mar. 30, 2019
Warranty Liability
Changes in warranty liability	Three Months Ended (In millions) March 30, March 31, Beginning of period $ $ Provision Settlements Adjustments* End of period $ $ * Adjustments include changes to prior year estimates, new issues on prior year sales, acquisitions and currency translation adjustments.

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 30, 2019
Leases
Schedule of balance sheet and other information	(Dollars in millions) March 30, Operating leases: Other assets $ Other current liabilities Other liabilities Finance leases: Property, plant and equipment, less accumulated amortization of $50 million $ Short-term and current portion of long-term debt Long-term debt Weighted-average remaining lease term (in years) Finance leases Operating leases Weighted-average discount rate Finance leases Operating leases
Summary of maturities of operating lease liabilities	(In millions) Operating Finance Leases 2019 $ $ 2020 2021 2022 2023 Thereafter Total lease payments Less: interest Total lease liabilities $ $
Summary of maturities of finance lease liabilities	(In millions) Operating Finance Leases 2019 $ $ 2020 2021 2022 2023 Thereafter Total lease payments Less: interest Total lease liabilities $ $

Derivative Instruments and Fa_2

Derivative Instruments and Fair Value Measurements (Tables)	3 Months Ended
	Mar. 30, 2019
Derivative Instruments and Fair Value Measurements
Carrying value and estimated fair value of financial instruments	March 30, 2019 December 29, 2018 (In millions) Carrying Estimated Carrying Estimated Fair Value Manufacturing group Debt, excluding leases $ $ $ $ Finance group Finance receivables, excluding leases Debt

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	3 Months Ended
	Mar. 30, 2019
Shareholders' Equity
Schedule of Shareholder's equity	(In millions) Common Capital Treasury Stock Retained Accumulated Comprehensive Loss Total Shareholders’ Equity Balance at December 29, 2018 $ $ $ $ $ $ Net income — — — — Other comprehensive income — — — — Share-based compensation activity — — — — Dividends declared — — — — Purchases of common stock — — — — Balance at March 30, 2019 $ $ $ $ $ $ Balance at December 30, 2017 $ $ $ $ $ $ Adoption of ASC 606 — — — — Net income — — — — Other comprehensive income — — — — Share-based compensation activity — — — — Dividends declared — — — — Purchases of common stock — — — — Balance at March 31, 2018 $ $ $ $ $ $
Schedule of weighted-average shares outstanding for basic and diluted EPS	Three Months Ended (In thousands) March 30, 2019 March 31, 2018 Basic weighted-average shares outstanding Dilutive effect of stock options Diluted weighted-average shares outstanding
Schedule of components of Accumulated Other Comprehensive Loss	(In millions) Pension and Foreign Deferred Gains (Losses) Accumulated Balance at December 29, 2018 $ $ $ $ Other comprehensive income before reclassifications — Reclassified from Accumulated other comprehensive loss — Balance at March 30, 2019 $ $ $ $ Balance at December 30, 2017 $ $ $ $ Other comprehensive income before reclassifications — Reclassified from Accumulated other comprehensive loss — — Balance at March 31, 2018 $ $ $ $
Schedule of before and after-tax components of other comprehensive income (loss)	March 30, 2019 March 31, 2018 (In millions) Pre-Tax Tax (Expense) After-Tax Pre-Tax Tax (Expense) After-Tax Three Months Ended Pension and postretirement benefits adjustments: Amortization of net actuarial loss* $ $ $ $ $ $ Amortization of prior service cost* — — Pension and postretirement benefits adjustments, net Deferred gains on hedge contracts: Current deferrals Reclassification adjustments — — — — Deferred gains on hedge contracts, net Foreign currency translation adjustments Total $ $ $ $ $ $ *These components of other comprehensive income are included in the computation of net periodic pension cost. See Note 14 of our 2018 Annual Report on Form 10-K for additional information.

Segment Information (Tables)

Segment Information (Tables)	3 Months Ended
	Mar. 30, 2019
Segment Information
Revenues by segment and reconciliation of segment profit to income before income taxes	Three Months Ended (In millions) March 30, 2019 March 31, 2018 Revenues Textron Aviation $ $ Bell Textron Systems Industrial Finance Total revenues $ $ Segment Profit Textron Aviation $ $ Bell Textron Systems Industrial Finance Segment profit Corporate expenses and other, net Interest expense, net for Manufacturing group Income before income taxes $ $

Revenues (Tables)

Revenues (Tables)	3 Months Ended
	Mar. 30, 2019
Revenues
Schedule of revenue by major product type, customer type and geographic location	Our revenues disaggregated by major product type are presented below: Three Months Ended (In millions) March 30, 2019 March 31, 2018 Aircraft $ $ Aftermarket parts and services Textron Aviation Military aircraft and support programs Commercial helicopters, parts and services Bell Unmanned systems Marine and land systems Simulation, training and other Textron Systems Fuel systems and functional components Specialized vehicles Tools and test equipment — Industrial Finance Total revenues $ $ Our revenues for our segments by customer type and geographic location are presented below: (In millions) Textron Bell Textron Industrial Finance Total Three months ended March 30, 2019 Customer type: Commercial $ $ $ $ $ $ U.S. Government — Total revenues $ $ $ $ $ $ Geographic location: United States $ $ $ $ $ $ Europe Asia and Australia Other international Total revenues $ $ $ $ $ $ Three months ended March 31, 2018 Customer type: Commercial $ $ $ $ $ $ U.S. Government — Total revenues $ $ $ $ $ $ Geographic location: United States $ $ $ $ $ $ Europe Asia and Australia Other international Total revenues $ $ $ $ $ $

Share-Based Compensation (Table

Share-Based Compensation (Tables)	3 Months Ended
	Mar. 30, 2019
Share-Based Compensation
Compensation expense included in net income	Three Months Ended (In millions) March 30, March 31, Compensation expense $ $ Income tax benefit Total net compensation expense included in net income $ $
Weighted-average fair value of stock options and assumptions used in option-pricing model	Three Months Ended March 30, March 31, Fair value of options at grant date $ $ Dividend yield Expected volatility Risk-free interest rate Expected term (in years)
Stock option activity	(Options in thousands) Number of Weighted- Outstanding at beginning of period $ Granted Exercised Forfeited or expired Outstanding at end of period $ Exercisable at end of period $
Restricted Stock Units
Share-Based Compensation
Unit period activity, Nonvested, Weighted average grant date fair value	Units Payable in Stock Units Payable in Cash (Shares/Units in thousands) Number of Weighted- Number of Weighted- Outstanding at beginning of period, nonvested $ $ Granted Vested Forfeited — — Outstanding at end of period, nonvested $ $
Fair value of awards vested and cash paid during respective periods	Three Months Ended (In millions) March 30, March 31, Fair value of awards vested $ $ Cash paid
Performance Share Units
Share-Based Compensation
Unit period activity, Nonvested, Weighted average grant date fair value	(Units in thousands) Number of Weighted- Outstanding at beginning of period, nonvested $ Granted Outstanding at end of period, nonvested $

Retirement Plans (Tables)

Retirement Plans (Tables)	3 Months Ended
	Mar. 30, 2019
Retirement Plans
Components of net periodic benefit cost (credit)	Pension Benefits Postretirement Benefits (In millions) March 30, March 31, March 30, March 31, Three Months Ended Service cost $ $ $ $ Interest cost Expected return on plan assets — — Amortization of prior service cost (credit) Amortization of net actuarial loss — — Net periodic benefit cost (credit) $ $ 7 $ $

Basis of Presentation (Details)

Basis of Presentation (Details) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 30, 2019USD ($)item$ / shares	Mar. 31, 2018USD ($)$ / shares
Number of borrowing groups | item	2
Cumulative catch-up method
Cumulative catch-up adjustments	$ 31	$ 40
Change in accounting estimate financial effect increase in net income	$ 23	$ 30
Change in accounting estimate financial effect increase in earnings per share diluted | $ / shares	$ 0.10	$ 0.12
Gross favorable adjustments	$ 53	$ 56
Gross unfavorable adjustments	$ 22	$ 16

Summary of Significant Accoun_3

Summary of Significant Accounting Policies Update (Details) - USD ($) $ in Millions	Mar. 30, 2019	Jan. 01, 2019
Summary of Significant Accounting Policies Update
Operating right-of-use assets	$ 301
Operating lease liabilities	$ 304
ASU 2016-02
Summary of Significant Accounting Policies Update
Operating right-of-use assets		$ 307
Operating lease liabilities		$ 307

Accounts Receivable and Finan_3

Accounts Receivable and Finance Receivables - Accounts receivable (Details) - Manufacturing group - USD ($) $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Accounts Receivable
Accounts Receivable, Gross	$ 1,088	$ 1,051
Allowance for doubtful accounts	(29)	(27)
Total	1,059	1,024
Commercial
Accounts Receivable
Accounts Receivable, Gross	946	885
U.S. Government contracts
Accounts Receivable
Accounts Receivable, Gross	$ 142	$ 166

Accounts Receivable and Finan_4

Accounts Receivable and Finance Receivables - Finance receivables (Details) - USD ($) $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Finance Receivables
Finance receivables, gross	$ 782	$ 789
Allowance for losses	(26)	(29)
Total finance receivables, net	$ 756	$ 760

Accounts Receivable and Finan_5

Accounts Receivable and Finance Receivables - Finance receivables by delinquency aging category (Details) $ in Millions	3 Months Ended
	Mar. 30, 2019USD ($)item	Dec. 29, 2018USD ($)
Finance receivables categorized based on the internally assigned credit quality
Number of loan categories based on key credit quality indicators for individual loan | item	3
60 + days contractual delinquency as a percentage of finance receivables	2.69%	1.77%
Less than 31 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	$ 691	$ 719
31-60 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	70	56
61- 90 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	17	5
Over 90 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	4	9
Performing
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	708	704
Watchlist
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	43	45
Nonaccrual
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	$ 31	$ 40
Nonaccrual as a percentage of finance receivables	3.96%	5.07%
Minimum | Nonaccrual
Finance receivables categorized based on the internally assigned credit quality
Number of months of contractual delinquency to classify accounts as nonaccrual unless such collection is not doubtful	3 months

Accounts Receivable and Finan_6

Accounts Receivable and Finance Receivables - Finance receivables and allowance for losses based on the results of impairment evaluation (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 30, 2019	Dec. 29, 2018
Finance receivables
Finance receivables evaluated collectively	$ 650	$ 630
Finance receivables evaluated individually	31	58
Allowance for losses based on collective evaluation	24	24
Allowance for losses based on individual evaluation	2	5
Impaired finance receivables with no related allowance for losses	21	43
Impaired finance receivables with related allowance for losses	10	15
Unpaid principal balance on impaired finance receivables	40	67
Average recorded investment of impaired finance receivables	$ 44	$ 61

Inventories (Details)

Inventories (Details) - USD ($) $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Inventories
Finished goods	$ 1,739	$ 1,662
Work in process	1,518	1,356
Raw materials and components	790	800
Total	$ 4,047	$ 3,818

Other Assets (Details)

Other Assets (Details) - USD ($) $ in Millions	Apr. 01, 2019	Mar. 30, 2019
Equity method investment
Amount of assets held for sale reclassified to other assets		$ 145
Property, plant and equipment		64
Allocated goodwill		$ 77
FlightSafety Textron Aviation Training LLC
Equity method investment
Investment (in percentage)	30.00%

Warranty Liability (Details)

Warranty Liability (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Changes in warranty liability
Balance at beginning of period	$ 149	$ 164
Provision	14	16
Settlements	(22)	(22)
Adjustments	4	10
Balance at end of period	$ 145	$ 168

Leases (Details)

Leases (Details) $ in Millions	3 Months Ended
	Mar. 30, 2019USD ($)
Leases
Operating lease - Option to extend	true
Operating lease cost	$ 16
Cash paid for operating lease liabilities	$ 16
Maximum
Leases
Operating lease and finance lease - Remaining lease term	30 years
Operating lease - Option to extend the lease, term	25 years

Leases - Balance sheet and othe

Leases - Balance sheet and other information (Details) - USD ($) $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Operating leases:
Other assets	$ 301
Other assets	us-gaap:OtherAssets
Other current liabilities	$ 54
Other current liabilities	us-gaap:OtherLiabilitiesCurrent
Other liabilities	$ 250
Other liabilities	us-gaap:OtherLiabilities
Finance leases:
Property, plant and equipment, less accumulated amortization of $50 million	$ 117
Property, plant and equipment, less accumulated amortization of $50 million	us-gaap:PropertyPlantAndEquipmentNet
Accumulated amortization	$ 4,256	$ 4,203
Short-term and current portion of long-term debt	$ 7
Short-term and current portion of long-term debt	us-gaap:DebtCurrent
Long-term debt	$ 78
Long-term debt	us-gaap:LongTermDebtAndCapitalLeaseObligations
Weighted-average remaining lease term (in years)
Finance leases	14 years 2 months 12 days
Operating leases	10 years 4 months 24 days
Weighted-average discount rate
Finance leases	2.72%
Operating leases	4.47%
Finance leased assets
Finance leases:
Accumulated amortization	$ 50

Leases - Maturity of lease liab

Leases - Maturity of lease liabilities (Details) $ in Millions	Mar. 30, 2019USD ($)
Operating Leases
2019	$ 48
2020	55
2021	42
2022	35
2023	30
Thereafter	177
Total lease payments	387
Less: interest	(83)
Total lease liabilities	304
Finance Leases
2019	7
2020	9
2021	9
2022	9
2023	9
Thereafter	69
Total lease payments	112
Less: interest	(27)
Total lease liabilities	$ 85

Derivative Instruments and Fa_3

Derivative Instruments and Fair Value Measurements - Assets and liabilities recorded at fair value on a recurring basis (Details) - Manufacturing group - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Dec. 29, 2018
Fair value of derivative instruments
Forward exchange contracts maximum maturity period	3 years
Foreign currency exchange contracts
Fair value of derivative instruments
Notional amounts	$ 489	$ 379
Level 2 | Foreign currency exchange contracts
Fair value of derivative instruments
Derivative Asset, Fair Value	4	2
Derivative Liability, Fair Value	$ 7	$ 10

Derivative Instruments and Fa_4

Derivative Instruments and Fair Value Measurements - Assets and liabilities not recorded at fair value (Details) - USD ($) $ in Millions	Mar. 30, 2019	Dec. 29, 2018
Manufacturing group | Carrying Value
Financial instruments not reflected at fair value
Debt, excluding leases	$ (3,105)	$ (2,996)
Manufacturing group | Estimated Fair Value
Financial instruments not reflected at fair value
Debt, excluding leases	(3,135)	(2,971)
Finance group
Financial instruments not reflected at fair value
Debt	(711)	(718)
Finance group | Carrying Value
Financial instruments not reflected at fair value
Finance receivables, excluding leases	579	582
Debt	(711)	(718)
Finance group | Estimated Fair Value
Financial instruments not reflected at fair value
Finance receivables, excluding leases	610	584
Debt	$ (645)	$ (640)

Shareholders' Equity (Details)

Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Increase (Decrease) in Stockholders' Equity
Beginning Balance	$ 5,192	$ 5,647
Net income	179	189
Other comprehensive income (loss)	26	74
Share-based compensation activity	43	41
Dividends declared	(5)	(5)
Purchases of common stock	(202)	(344)
Ending Balance	$ 5,233	$ 5,692
Dividends per share of common stock	$ 0.02	$ 0.02
Common Stock
Increase (Decrease) in Stockholders' Equity
Beginning Balance	$ 30	$ 33
Ending Balance	30	33
Capital Surplus
Increase (Decrease) in Stockholders' Equity
Beginning Balance	1,646	1,669
Share-based compensation activity	43	41
Ending Balance	1,689	1,710
Treasury Stock
Increase (Decrease) in Stockholders' Equity
Beginning Balance	(129)	(48)
Purchases of common stock	(202)	(344)
Ending Balance	(331)	(392)
Retained Earnings
Increase (Decrease) in Stockholders' Equity
Beginning Balance	5,407	5,368
Net income	179	189
Dividends declared	(5)	(5)
Ending Balance	5,581	5,642
Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity
Beginning Balance	(1,762)	(1,375)
Other comprehensive income (loss)	26	74
Ending Balance	$ (1,736)	(1,301)
ASC 606
Increase (Decrease) in Stockholders' Equity
Adoption of ASC 606		90
ASC 606 | Retained Earnings
Increase (Decrease) in Stockholders' Equity
Adoption of ASC 606		$ 90

Shareholders' Equity - Earnings

Shareholders' Equity - Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Weighted-average shares outstanding for basic and diluted EPS
Basic weighted-average shares outstanding	234,839	260,497
Dilutive effect of stock options	1,598	3,175
Diluted weighted-average shares outstanding	236,437	263,672
Anti-dilutive effect of weighted average shares	3,100	1,300

Shareholders' Equity - Componen

Shareholders' Equity - Components of accumulated other comprehensive loss (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Components of Accumulated Other Comprehensive Loss
Beginning of period	$ (1,762)
End of period	(1,736)
Accumulated Other Comprehensive Loss
Components of Accumulated Other Comprehensive Loss
Beginning of period	(1,762)	$ (1,375)
Other comprehensive income before reclassifications	6	43
Reclassified from Accumulated other comprehensive loss	20	31
End of period	(1,736)	(1,301)
Pension and Postretirement Benefits Adjustments
Components of Accumulated Other Comprehensive Loss
Beginning of period	(1,727)	(1,396)
Reclassified from Accumulated other comprehensive loss	21	31
End of period	(1,706)	(1,365)
Foreign Currency Translation Adjustments
Components of Accumulated Other Comprehensive Loss
Beginning of period	(32)	11
Other comprehensive income before reclassifications	3	42
End of period	(29)	53
Deferred Gains (Losses) on Hedge Contracts
Components of Accumulated Other Comprehensive Loss
Beginning of period	(3)	10
Other comprehensive income before reclassifications	3	1
Reclassified from Accumulated other comprehensive loss	(1)
End of period	$ (1)	$ 11

Shareholders' Equity - Before a

Shareholders' Equity - Before and after-tax components of other comprehensive income (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Pension and postretirement benefits adjustments, pre-tax:
Amortization of net actuarial loss, pre-tax	$ 25	$ 38
Amortization of prior service cost, pre-tax	1	2
Pension and postretirement benefits adjustments, net, pre-tax	26	40
Deferred gains on hedge contracts, pre-tax:
Current deferrals, pre-tax	4	2
Reclassification adjustments, pre-tax	(1)
Deferred gains on hedge contracts, net, pre-tax	3	2
Foreign currency translation adjustments, pre-tax:
Foreign currency translation adjustments, pre-tax	1	40
Other comprehensive income (loss), pre-tax	30	82
Pension and postretirement benefits adjustments, tax:
Amortization of net actuarial loss, tax	(5)	(9)
Pension and postretirement benefits adjustments, net, tax	(5)	(9)
Deferred gains on hedge contracts, tax:
Current deferrals, tax	(1)	(1)
Deferred gains on hedge contracts, net, tax	(1)	(1)
Foreign currency translation adjustments, tax:
Foreign currency translation adjustments, tax	2	2
Other comprehensive income (loss), tax	(4)	(8)
Pension and postretirement benefits adjustments, after-tax:
Amortization of net actuarial loss, after-tax	20	29
Amortization of prior service cost, after-tax	1	2
Pension and postretirement benefits adjustments, net, after-tax	21	31
Deferred gains on hedge contracts, after-tax:
Current deferrals, after-tax	3	1
Reclassification adjustments, after-tax	(1)
Deferred gains on hedge contracts, net, after-tax	2	1
Foreign currency translation adjustments, after-tax:
Foreign currency translation adjustments, after-tax	3	42
Other comprehensive income	$ 26	$ 74

Segment Information - Operating

Segment Information - Operating and reportable segments (Details)	3 Months Ended
	Mar. 30, 2019segment
Operating and reportable business segments
Number of business operating segments	5
Number of reportable business segments	5

Segment Information - Reconcili

Segment Information - Reconciliation of segment profit to income from continuing operations before income taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Revenues
Total revenues	$ 3,109	$ 3,296
Reconciliation of Operating Profit (Loss) from Segments to Consolidated
Income before income taxes	212	218
Operating Segment
Segment Profit
Segment Profit	294	279
Corporate
Reconciliation of Operating Profit (Loss) from Segments to Consolidated
Corporate expenses and other, net	(47)	(27)
Finance
Revenues
Finance Revenues	17	16
Finance | Operating Segment
Segment Profit
Segment Profit	6	6
Manufacturing group | Reconciling Items
Reconciliation of Operating Profit (Loss) from Segments to Consolidated
Interest expense, net for Manufacturing group	(35)	(34)
Manufacturing group | Textron Aviation
Revenues
Total revenues	1,134	1,010
Manufacturing group | Textron Aviation | Operating Segment
Segment Profit
Segment Profit	106	72
Manufacturing group | Bell
Revenues
Total revenues	739	752
Manufacturing group | Bell | Operating Segment
Segment Profit
Segment Profit	104	87
Manufacturing group | Textron Systems
Revenues
Total revenues	307	387
Manufacturing group | Textron Systems | Operating Segment
Segment Profit
Segment Profit	28	50
Manufacturing group | Industrial
Revenues
Total revenues	912	1,131
Manufacturing group | Industrial | Operating Segment
Segment Profit
Segment Profit	50	64
Finance group | Finance
Revenues
Finance Revenues	$ 17	$ 16

Revenues (Details)

Revenues (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Revenues
Total revenues	$ 3,109	$ 3,296
United States
Revenues
Total revenues	2,021	1,964
Europe
Revenues
Total revenues	538	569
Asia and Australia
Revenues
Total revenues	199	330
Other international
Revenues
Total revenues	351	433
Commercial
Revenues
Total revenues	2,318	2,492
U.S. Government
Revenues
Total revenues	791	804
Textron Aviation
Revenues
Total revenues	1,134	1,010
Textron Aviation | United States
Revenues
Total revenues	789	665
Textron Aviation | Europe
Revenues
Total revenues	183	146
Textron Aviation | Asia and Australia
Revenues
Total revenues	23	81
Textron Aviation | Other international
Revenues
Total revenues	139	118
Textron Aviation | Commercial
Revenues
Total revenues	1,092	973
Textron Aviation | U.S. Government
Revenues
Total revenues	42	37
Textron Aviation | Aircraft
Revenues
Total revenues	766	634
Textron Aviation | Aftermarket parts and services
Revenues
Total revenues	368	376
Bell
Revenues
Total revenues	739	752
Bell | United States
Revenues
Total revenues	578	509
Bell | Europe
Revenues
Total revenues	20	27
Bell | Asia and Australia
Revenues
Total revenues	82	127
Bell | Other international
Revenues
Total revenues	59	89
Bell | Commercial
Revenues
Total revenues	230	252
Bell | U.S. Government
Revenues
Total revenues	509	500
Bell | Military aircraft and support programs
Revenues
Total revenues	508	487
Bell | Commercial helicopters, parts and services
Revenues
Total revenues	231	265
Textron Systems
Revenues
Total revenues	307	387
Textron Systems | United States
Revenues
Total revenues	257	287
Textron Systems | Europe
Revenues
Total revenues	23	12
Textron Systems | Asia and Australia
Revenues
Total revenues	16	28
Textron Systems | Other international
Revenues
Total revenues	11	60
Textron Systems | Commercial
Revenues
Total revenues	74	127
Textron Systems | U.S. Government
Revenues
Total revenues	233	260
Textron Systems | Unmanned systems
Revenues
Total revenues	134	170
Textron Systems | Marine and land systems
Revenues
Total revenues	48	92
Textron Systems | Simulation, training and other
Revenues
Total revenues	125	125
Industrial
Revenues
Total revenues	912	1,131
Industrial | United States
Revenues
Total revenues	389	496
Industrial | Europe
Revenues
Total revenues	311	383
Industrial | Asia and Australia
Revenues
Total revenues	77	92
Industrial | Other international
Revenues
Total revenues	135	160
Industrial | Commercial
Revenues
Total revenues	905	1,124
Industrial | U.S. Government
Revenues
Total revenues	7	7
Industrial | Fuel systems and functional components
Revenues
Total revenues	594	655
Industrial | Specialized vehicles
Revenues
Total revenues	318	348
Industrial | Tools and test equipment
Revenues
Total revenues		128
Finance
Revenues
Finance Revenue	17	16
Finance | United States
Revenues
Finance Revenue	8	7
Finance | Europe
Revenues
Finance Revenue	1	1
Finance | Asia and Australia
Revenues
Finance Revenue	1	2
Finance | Other international
Revenues
Finance Revenue	7	6
Finance | Commercial
Revenues
Finance Revenue	$ 17	$ 16

Revenues - Remaining Performanc

Revenues - Remaining Performance Obligations (Details) $ in Billions	Mar. 30, 2019USD ($)
Revenues
Remaining performance obligations	$ 9.7

Revenues - Remaining Performa_2

Revenues - Remaining Performance Obligations & Revenue Expected to be recognized (Details)	Mar. 30, 2019
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-02
Remaining Performance Obligation, Expected Timing of Satisfaction
Percentage of remaining performance obligation expected to be recognized in period	70.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-12-31
Remaining Performance Obligation, Expected Timing of Satisfaction
Percentage of remaining performance obligation expected to be recognized in period	23.00%

Revenues - Contract Assets and

Revenues - Contract Assets and Liabilities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018	Dec. 29, 2018
Contract Assets and Liabilities
Contract assets	$ 477		$ 461
Contract liabilities	927		$ 974
Revenue recognized included in contract liabilities	$ 311	$ 322

Share-Based Compensation - Comp

Share-Based Compensation - Compensation expense and stock options (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Compensation expense included in net income
Compensation expense	$ 44	$ 33
Income tax benefit	(11)	(7)
Total net compensation expense included in net income	$ 33	$ 26
Stock Options
Share-Based Compensation
Maximum term of options	10 years
Vesting period	3 years
Weighted-average assumptions used in Black-Scholes option-pricing model
Fair value of options at grant date	$ 14.62	$ 15.83
Dividend yield (as a percent)	0.20%	0.10%
Expected volatility (as a percent)	26.60%	26.60%
Risk-free interest rate (as a percent)	2.50%	2.60%
Expected term (in years)	4 years 8 months 12 days	4 years 8 months 12 days
Number of Options
Outstanding at beginning of period (in shares)	8,284
Granted	1,583
Exercised	(558)
Forfeited or expired	(75)
Outstanding at end of period (in shares)	9,234
Exercisable at end of period (in shares)	6,182
Weighted-Average Exercise Price
Outstanding at beginning of period (in dollars per share)	$ 40.58
Granted	54.43
Exercised	(25.06)
Forfeited or expired	(47.43)
Outstanding at end of period (in dollars per share)	43.84
Exercisable at end of period (in dollars per share)	$ 38.45
Additional information
Aggregate intrinsic value of outstanding options	$ 80
Weighted-average remaining contractual life of outstanding stock options	6 years
Aggregate intrinsic value of exercisable options	$ 79
Weighted-average remaining contractual life of exercisable options	5 years
Aggregate intrinsic value of options exercised	$ 16	$ 8

Share-Based Compensation - Rest

Share-Based Compensation - Restricted stock units payable in stock and cash (Details) shares in Thousands	3 Months Ended
	Mar. 30, 2019$ / sharesshares
Restricted Stock Units Payable in Stock
Number of Shares/Units
Outstanding at beginning of period, nonvested (in shares) | shares	598
Granted | shares	168
Vested | shares	(164)
Outstanding at end of period, nonvested (in shares) | shares	602
Weighted-Average Grant Date Fair Value
Outstanding at beginning of period, nonvested (in dollars per share) | $ / shares	$ 45.22
Granted | $ / shares	54.43
Vested | $ / shares	(39.34)
Outstanding at end of period, nonvested (in dollars per share) | $ / shares	$ 49.40
Restricted Stock Units Payable in Cash
Number of Shares/Units
Outstanding at beginning of period, nonvested (in shares) | shares	1,143
Granted | shares	327
Vested | shares	(294)
Forfeited | shares	(30)
Outstanding at end of period, nonvested (in shares) | shares	1,146
Weighted-Average Grant Date Fair Value
Outstanding at beginning of period, nonvested (in dollars per share) | $ / shares	$ 45.48
Granted | $ / shares	54.43
Vested | $ / shares	(39.27)
Forfeited | $ / shares	(46.76)
Outstanding at end of period, nonvested (in dollars per share) | $ / shares	$ 49.59

Share-Based Compensation - Fair

Share-Based Compensation - Fair value of restricted stock awards vested and cash paid for restricted stock awards (Details) - Restricted Stock Units - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Share-Based Compensation
Fair value of awards vested	$ 22	$ 24
Cash paid	$ 16	$ 18

Share-Based Compensation - Perf

Share-Based Compensation - Performance share units (Details) - Performance Share Units - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Share-Based Compensation
Cash paid	$ 10	$ 11
Number of Units
Outstanding at beginning of period, nonvested (in shares)	404
Granted	262
Outstanding at end of period, nonvested (in shares)	666
Weighted-Average Grant Date Fair Value
Outstanding at beginning of period, nonvested (in dollars per share)	$ 53.63
Granted	54.43
Outstanding at end of period, nonvested (in dollars per share)	$ 53.95

Retirement Plans - Net periodic

Retirement Plans - Net periodic benefit cost (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018
Pension Benefits
Net periodic benefit cost
Service cost	$ 23	$ 26
Interest cost	82	77
Expected return on plan assets	(139)	(138)
Amortization of prior service cost (credit)	3	4
Amortization of net actuarial loss	25	38
Net periodic benefit cost (credit)	(6)	7
Postretirement Benefits Other Than Pensions
Net periodic benefit cost
Service cost	1	1
Interest cost	2	2
Amortization of prior service cost (credit)	(2)	(2)
Net periodic benefit cost (credit)	$ 1	$ 1

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 30, 2019	Mar. 31, 2018	Dec. 29, 2018
Income Taxes
Effective income tax rate (as a percent)	15.60%	13.30%
U.S. federal statutory income tax rate (as a percent)	21.00%	21.00%
Discrete tax benefit	$ 12
Unrecognized tax benefits	$ 175		$ 141