Textron (TXT) 10-Q 24 Jul 19 2019 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 29, 2019	Jul. 12, 2019
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 29, 2019
Document Transition Report	false
Entity File Number	1-5480
Entity Registrant Name	Textron Inc
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	05-0315468
Entity Address, Address Line One	40 Westminster Street
Entity Address, City or Town	Providence
Entity Address, State or Province	RI
Entity Address, Postal Zip Code	02903
City Area Code	401
Local Phone Number	421-2800
Title of 12(b) Security	Common stock, $0.125 par value
Trading Symbol	TXT
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		230,123,580
Entity Central Index Key	0000217346
Current Fiscal Year End Date	--01-04
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Amendment Flag	false

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Revenues
Total revenues	$ 3,227	$ 3,726	$ 6,336	$ 7,022
Costs, expenses and other
Cost of sales	2,641	3,073	5,218	5,802
Selling and administrative expense	292	370	599	697
Interest expense	43	42	85	83
Non-service components of pension and post-retirement income, net	(28)	(19)	(57)	(38)
Total costs, expenses and other	2,948	3,466	5,845	6,544
Income before income taxes	279	260	491	478
Income tax expense	62	36	95	65
Net income	$ 217	$ 224	$ 396	$ 413
Earnings per share
Basic (in dollars per share)	$ 0.94	$ 0.88	$ 1.70	$ 1.61
Diluted (in dollars per share)	$ 0.93	$ 0.87	$ 1.69	$ 1.59
Manufacturing
Revenues
Total revenues	$ 3,211	$ 3,709	$ 6,303	$ 6,989
Finance
Revenues
Finance Revenue	$ 16	$ 17	$ 33	$ 33

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Net income	$ 217	$ 224	$ 396	$ 413
Other comprehensive income (loss), net of taxes:
Pension and postretirement benefits adjustments, net of reclassifications	20	31	41	62
Foreign currency translation adjustments	1	(69)	4	(27)
Deferred gains (losses) on hedge contracts, net of reclassifications		(4)	2	(3)
Other comprehensive income (loss)	21	(42)	47	32
Comprehensive income	$ 238	$ 182	$ 443	$ 445

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Millions	Jun. 29, 2019	Dec. 29, 2018
Assets
Inventories	$ 4,311	$ 3,818
Finance receivables, net	776	760
Total assets	14,796	14,264
Liabilities
Total liabilities	9,460	9,072
Shareholders' equity
Common stock	30	30
Capital surplus	1,717	1,646
Treasury stock	(490)	(129)
Retained earnings	5,794	5,407
Accumulated other comprehensive loss	(1,715)	(1,762)
Total shareholders' equity	5,336	5,192
Total liabilities and shareholders' equity	$ 14,796	$ 14,264
Common shares outstanding	230,058	235,621
Manufacturing group
Assets
Cash and equivalents	$ 775	$ 987
Accounts receivable, net	989	1,024
Inventories	4,311	3,818
Other current assets	839	785
Total current assets	6,914	6,614
Property, plant and equipment, less accumulated depreciation and amortization of $4,317 and $4,203, respectively	2,517	2,615
Goodwill	2,147	2,218
Other assets	2,255	1,800
Total assets	13,833	13,247
Liabilities
Short-term debt and current portion of long-term debt	457	258
Accounts payable	1,231	1,099
Other current liabilities	1,891	2,149
Total current liabilities	3,579	3,506
Other liabilities	2,157	1,932
Long-term debt	2,910	2,808
Total liabilities	8,646	8,246
Finance group
Assets
Cash and equivalents	82	120
Finance receivables, net	776	760
Other assets	105	137
Total assets	963	1,017
Liabilities
Other liabilities	111	108
Debt	703	718
Total liabilities	$ 814	$ 826

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Jun. 29, 2019	Dec. 29, 2018
Accumulated depreciation and amortization	$ 4,317	$ 4,203

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Millions	6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018
Cash flows from operating activities
Net income	$ 396	$ 413
Non-cash items:
Depreciation and amortization	202	216
Deferred income taxes	32	12
Other, net	40	61
Changes in assets and liabilities:
Accounts receivable, net	36	(42)
Inventories	(505)	(78)
Other assets	(19)	(38)
Accounts payable	132	(22)
Other liabilities	(338)	(165)
Income taxes, net	14	17
Pension, net	(29)	(5)
Captive finance receivables, net	(19)	26
Other operating activities, net	(2)	3
Net cash provided by (used in) operating activities of continuing operations	(60)	398
Net cash used in operating activities of discontinued operations	(1)	(1)
Net cash provided by (used in) operating activities	(61)	397
Cash flows from investing activities
Capital expenditures	(135)	(159)
Net proceeds from corporate-owned life insurance policies	4	98
Finance receivables repaid	20	25
Other investing activities, net	7	30
Net cash provided by (used in) investing activities	(104)	(6)
Cash flows from financing activities
Proceeds from long-term debt	297
Principal payments on long-term debt and nonrecourse debt	(35)	(34)
Purchases of Textron common stock	(361)	(915)
Dividends paid	(9)	(10)
Other financing activities, net	19	43
Net cash used in financing activities	(89)	(916)
Effect of exchange rate changes on cash and equivalents	4	(6)
Net decrease in cash and equivalents	(250)	(531)
Cash and equivalents at beginning of period	1,107	1,262
Cash and equivalents at end of period	857	731
Manufacturing group
Cash flows from operating activities
Net income	387	398
Non-cash items:
Depreciation and amortization	199	212
Deferred income taxes	33	14
Other, net	39	60
Changes in assets and liabilities:
Accounts receivable, net	36	(42)
Inventories	(532)	(80)
Other assets	(17)	(39)
Accounts payable	132	(22)
Other liabilities	(339)	(162)
Income taxes, net	10	28
Pension, net	(29)	(5)
Dividends received from Finance group	50	50
Other operating activities, net	(2)	3
Net cash provided by (used in) operating activities of continuing operations	(33)	415
Net cash used in operating activities of discontinued operations	(1)	(1)
Net cash provided by (used in) operating activities	(34)	414
Cash flows from investing activities
Capital expenditures	(135)	(159)
Net proceeds from corporate-owned life insurance policies	4	98
Other investing activities, net	4	10
Net cash provided by (used in) investing activities	(127)	(51)
Cash flows from financing activities
Proceeds from long-term debt	297
Principal payments on long-term debt and nonrecourse debt	(1)
Purchases of Textron common stock	(361)	(915)
Dividends paid	(9)	(10)
Other financing activities, net	19	43
Net cash used in financing activities	(55)	(882)
Effect of exchange rate changes on cash and equivalents	4	(6)
Net decrease in cash and equivalents	(212)	(525)
Cash and equivalents at beginning of period	987	1,079
Cash and equivalents at end of period	775	554
Finance group
Cash flows from operating activities
Net income	9	15
Non-cash items:
Depreciation and amortization	3	4
Deferred income taxes	(1)	(2)
Other, net	1	1
Changes in assets and liabilities:
Other assets	(2)	1
Other liabilities	1	(3)
Income taxes, net	4	(11)
Net cash provided by (used in) operating activities of continuing operations	15	5
Net cash provided by (used in) operating activities	15	5
Cash flows from investing activities
Finance receivables repaid	91	112
Finance receivables originated	(90)	(61)
Other investing activities, net	30	22
Net cash provided by (used in) investing activities	31	73
Cash flows from financing activities
Principal payments on long-term debt and nonrecourse debt	(34)	(34)
Dividends paid	(50)	(50)
Net cash used in financing activities	(84)	(84)
Net decrease in cash and equivalents	(38)	(6)
Cash and equivalents at beginning of period	120	183
Cash and equivalents at end of period	$ 82	$ 177

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 29, 2019
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 second quarter of 2019 and 2018, our cumulative catch-up adjustments increased revenue and segment profit by $27 million and $64 million, respectively, and net income by $21 million and $49 million, respectively ($0.09 and $0.19 per diluted share, respectively). In the second quarter of 2019 and 2018, gross favorable adjustments totaled $46 million and $70 million, respectively, and the gross unfavorable adjustments totaled $19 million and $6 million, respectively. ​ In the first half of 2019 and 2018, our cumulative catch-up adjustments increased revenue and segment profit by $58 million and $104 million, respectively, and net income by $44 million and $79 million, respectively ($0.19 and $0.30 per diluted share, respectively). In the first half of 2019 and 2018, gross favorable adjustments totaled $99 million and $126 million, respectively, and the gross unfavorable adjustments totaled $41 million and $22 million, respectively. ​

Summary of Significant Accounti

Summary of Significant Accounting Policies Update	6 Months Ended
	Jun. 29, 2019
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 . ​ 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. ​

Accounts Receivable and Finance

Accounts Receivable and Finance Receivables	6 Months Ended
	Jun. 29, 2019
Accounts Receivable and Finance Receivables	Note 3. Accounts Receivable and Finance Receivables ​ Accounts Receivable Accounts receivable is composed of the following: ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Commercial $ 874 $ 885 U.S. Government contracts ​ 142 166 ​ ​ 1,016 1,051 Allowance for doubtful accounts ​ (27) (27) Total accounts receivable, net $ 989 $ 1,024 ​ Finance Receivables Finance receivables are presented in the following table: ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables $ 802 $ 789 Allowance for losses ​ (26) (29) Total finance receivables, net $ 776 $ 760 ​ 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: ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (Dollars in millions) 2019 2018 Performing $ 732 $ 704 Watchlist ​ 39 45 Nonaccrual ​ 31 40 Nonaccrual as a percentage of finance receivables ​ 3.87 % ​ 5.07 % Less than 31 days past due $ 726 $ 719 31-60 days past due ​ 64 ​ 56 61-90 days past due ​ 3 ​ 5 Over 90 days past due ​ 9 ​ 9 60+ days contractual delinquency as a percentage of finance receivables ​ 1.50 % ​ 1.77 % ​ 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. ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables evaluated collectively $ 669 $ 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 $ 23 $ 43 Impaired finance receivables with related allowance for losses ​ 8 ​ 15 Unpaid principal balance of impaired finance receivables ​ 41 ​ 67 Average recorded investment of impaired finance receivables ​ 40 ​ 61 ​

Inventories

Inventories	6 Months Ended
	Jun. 29, 2019
Inventories	Note 4. Inventories ​ Inventories are composed of the following: ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finished goods $ 1,743 $ 1,662 Work in process ​ 1,771 1,356 Raw materials and components ​ 797 800 Total inventories $ 4,311 $ 3,818 ​

Other Assets

Other Assets	6 Months Ended
	Jun. 29, 2019
Other Assets
Other Assets	Note 5. Other Assets ​ On April 1, 2019, TRU Simulation + Training Inc., a business within our Textron Systems segment, 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 commercial business and general aviation aircraft. We have a 30% interest in this newly formed company and our investment is accounted for under the equity method of accounting. We contributed assets with a carrying value of $69 million to the company, which primarily included property, plant and equipment. In addition, $71 million of the Textron Systems segment's goodwill was allocated to this transaction. In the second quarter of 2019, based on the fair value of our share of the business, we recorded a pre-tax net gain of $18 million, subject to post-closing adjustments, to cost of sales in our Consolidated Statements of Operations. ​

Warranty Liability

Warranty Liability	6 Months Ended
	Jun. 29, 2019
Warranty Liability
Warranty Liability	Note 6. Warranty Liability ​ Changes in our warranty liability are as follows: ​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ June 29, June 30, (In millions) 2019 2018 Beginning of period $ 149 $ 164 Provision 30 34 Settlements (38) (39) Adjustments* (5) 7 End of period $ 136 $ 166 * Adjustments include changes to prior year estimates, new issues on prior year sales, business dispositions, acquisitions and currency translation adjustments. ​

Leases

Leases	6 Months Ended
	Jun. 29, 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 second quarter and first half of 2019, our operating lease cost totaled $16 million and $32 million, respectively. Our finance lease cost and our variable and short-term lease costs were not significant. In the first half of 2019, cash paid for operating lease liabilities totaled $32 million, which is classified in cash flows from operating activities. Balance sheet and other information related to our leases is as follows: ​ ​ ​ ​ ​ ​ June 29, (Dollars in millions) 2019 Operating leases: ​ ​ Other assets $ 298 Other current liabilities 53 Other liabilities 247 Finance leases: ​ Property, plant and equipment, less accumulated amortization of $51 million $ 116 Short-term and current portion of long-term debt 6 Long-term debt 77 Weighted-average remaining lease term (in years) ​ Finance leases 14.1 Operating leases 10.3 Weighted-average discount rate ​ Finance leases 2.73 % Operating leases 4.46 % ​ Maturities of our lease liabilities at June 29, 2019 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ Operating Finance (In millions) Leases Leases 2019 $ 34 $ 5 2020 57 9 2021 43 9 2022 37 9 2023 31 9 Thereafter 179 69 Total lease payments 381 110 Less: interest (81) (27) Total lease liabilities $ 300 $ 83 ​ ​

Debt

Debt	6 Months Ended
	Jun. 29, 2019
Debt	Note 8. Debt ​ Under our shelf registration statement, on May 7, 2019, we issued $300 million of fixed-rate notes due September 17, 2029 with an annual interest rate of 3.90%. The net proceeds of the issuance totaled $297 million, after deducting underwriting discounts, commissions and offering expenses. ​ On June 24, 2019, the Finance Group's $150 million fixed-rate loan due August 16, 2019 was amended. The maturity date of this loan was extended to June 23, 2022 and the annual interest rate was modified from 2.26% to 2.88%. ​

Derivative Instruments and Fair

Derivative Instruments and Fair Value Measurements	6 Months Ended
	Jun. 29, 2019
Derivative Instruments and Fair Value Measurements	Note 9. 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 June 29, 2019 and December 29, 2018, we had foreign currency exchange contracts with notional amounts upon which the contracts were based of $395 million and $379 million, respectively. At June 29, 2019, the fair value amounts of our foreign currency exchange contracts were a $2 million asset and a $3 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: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 December 29, 2018 ​ Carrying Estimated Carrying Estimated (In millions) Value Fair Value Value Fair Value Manufacturing group ​ ​ ​ ​ ​ ​ ​ ​ Debt, excluding leases $ (3,301) $ (3,414) $ (2,996) $ (2,971) Finance group ​ ​ ​ ​ ​ ​ ​ ​ Finance receivables, excluding leases 589 615 582 584 Debt (703) (640) (718) (640) ​ 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	6 Months Ended
	Jun. 29, 2019
Shareholders' Equity	Note 10. Shareholders’ Equity ​ A reconciliation of Shareholders’ equity is presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Total ​ Common Capital Treasury Retained Comprehensive Shareholders’ (In millions) Stock Surplus Stock Earnings Loss Equity Three months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,689 $ (331) $ 5,581 $ (1,736) $ 5,233 Net income ​ — ​ — ​ — ​ 217 ​ — ​ 217 Other comprehensive income ​ — ​ — ​ — ​ — ​ 21 ​ 21 Share-based compensation activity ​ — ​ 28 ​ — ​ — ​ — ​ 28 Dividends declared ​ — ​ — ​ — ​ (4) ​ — ​ (4) Purchases of common stock ​ — ​ — ​ (159) ​ — ​ — ​ (159) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,710 $ (392) $ 5,642 $ (1,301) $ 5,692 Net income — — — 224 — 224 Other comprehensive (loss) — — — — (42) (42) Share-based compensation activity — 64 — — — 64 Dividends declared — — — (5) — (5) Purchases of common stock — — (571) — — (571) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,646 $ (129) $ 5,407 $ (1,762) $ 5,192 Net income ​ — ​ — ​ — ​ 396 ​ — ​ 396 Other comprehensive income ​ — ​ — ​ — ​ — ​ 47 ​ 47 Share-based compensation activity ​ — ​ 71 ​ — ​ — ​ — ​ 71 Dividends declared ​ — ​ — ​ — ​ (9) ​ — ​ (9) Purchases of common stock ​ — ​ — ​ (361) ​ — ​ — ​ (361) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,669 $ (48) $ 5,368 $ (1,375) $ 5,647 Adoption of ASC 606 — — — 90 — 90 Net income — — — 413 — 413 Other comprehensive income — — — — 32 32 Share-based compensation activity — 105 — — — 105 Dividends declared — — — (10) — (10) Purchases of common stock — — (915) — — (915) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 ​ Dividends per share of common stock were $0.02 for both the second quarter of 2019 and 2018 and $0.04 for both the first half of 2019 and 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 Six Months Ended ​ June 29, June 30, June 29, June 30, (In thousands) 2019 2018 2019 2018 Basic weighted-average shares outstanding 232,013 253,904 233,426 257,200 Dilutive effect of stock options 1,532 3,273 1,567 3,262 Diluted weighted-average shares outstanding 233,545 257,177 234,993 260,462 ​ Stock options to purchase 3.1 million shares of common stock were excluded from the calculation of diluted weighted-average shares outstanding for both the second quarter and first half of 2019, as their effect would have been anti-dilutive. Stock options to purchase 1.3 million shares of common stock were excluded from the calculation of diluted weighted-average shares outstanding for both the second quarter and first half of 2018, 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: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and Foreign Deferred Accumulated ​ Postretirement Currency Gains (Losses) Other ​ Benefits Translation on Hedge Comprehensive (In millions) Adjustments Adjustments Contracts Loss Balance at December 29, 2018 $ (1,727) $ (32) $ (3) $ (1,762) Other comprehensive income before reclassifications ​ — ​ 4 ​ 4 ​ 8 Reclassified from Accumulated other comprehensive loss ​ 41 ​ — ​ (2) ​ 39 Balance at June 29, 2019 $ (1,686) $ (28) $ (1) $ (1,715) Balance at December 30, 2017 $ (1,396) $ 11 $ 10 $ (1,375) Other comprehensive income before reclassifications — (27) (2) (29) Reclassified from Accumulated other comprehensive loss 62 — (1) 61 Balance at June 30, 2018 $ (1,334) $ (16) $ 7 $ (1,343) ​ The before and after-tax components of Other comprehensive income (loss) are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 June 30, 2018 ​ ​ ​ Tax ​ ​ ​ Tax ​ ​ Pre-Tax (Expense) After-Tax Pre-Tax (Expense) After-Tax (In millions) Amount Benefit Amount Amount Benefit Amount Three Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 24 $ (6) $ 18 $ 39 $ (9) $ 30 Amortization of prior service cost* 3 (1) 2 ​ 2 ​ (1) ​ 1 Pension and postretirement benefits adjustments, net 27 (7) 20 ​ 41 ​ (10) ​ 31 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 2 (1) 1 ​ (4) ​ 1 ​ (3) Reclassification adjustments (1) — (1) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net ​ 1 ​ (1) ​ — ​ (5) ​ 1 ​ (4) Foreign currency translation adjustments ​ 3 ​ (2) ​ 1 ​ (66) ​ (3) ​ (69) Total $ 31 $ (10) $ 21 $ (30) $ (12) $ (42) Six Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 49 $ (11) $ 38 $ 77 $ (18) $ 59 Amortization of prior service cost* 4 (1) 3 ​ 4 ​ (1) ​ 3 Pension and postretirement benefits adjustments, net 53 (12) 41 ​ 81 ​ (19) ​ 62 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 6 (2) 4 ​ (2) ​ — ​ (2) Reclassification adjustments (2) — (2) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net 4 (2) 2 ​ (3) ​ — ​ (3) Foreign currency translation adjustments 4 — 4 ​ (26) ​ (1) ​ (27) Total $ 61 $ (14) $ 47 $ 52 $ (20) $ 32 *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	6 Months Ended
	Jun. 29, 2019
Segment Information	Note 11. 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 Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Revenues ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 1,123 $ 1,276 $ 2,257 $ 2,286 Bell ​ 771 831 ​ 1,510 ​ 1,583 Textron Systems ​ 308 380 ​ 615 ​ 767 Industrial ​ 1,009 1,222 ​ 1,921 ​ 2,353 Finance ​ 16 17 ​ 33 ​ 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 Segment Profit ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 105 $ 104 $ 211 $ 176 Bell ​ 103 117 ​ 207 ​ 204 Textron Systems ​ 49 40 ​ 77 ​ 90 Industrial ​ 76 80 ​ 126 ​ 144 Finance ​ 6 5 ​ 12 ​ 11 Segment profit ​ 339 346 ​ 633 ​ 625 Corporate expenses and other, net ​ (24) (51) (71) ​ (78) Interest expense, net for Manufacturing group (36) (35) (71) ​ (69) Income before income taxes $ 279 $ 260 $ 491 $ 478 ​

Revenues

Revenues	6 Months Ended
	Jun. 29, 2019
Revenues	Note 12. Revenues ​ Disaggregation of Revenues Our revenues disaggregated by major product type are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Aircraft $ 733 $ 877 $ 1,499 $ 1,511 Aftermarket parts and services ​ 390 399 ​ 758 775 Textron Aviation ​ 1,123 1,276 ​ 2,257 2,286 Military aircraft and support programs ​ 482 533 ​ 990 1,020 Commercial helicopters, parts and services ​ 289 298 ​ 520 563 Bell ​ 771 831 ​ 1,510 1,583 Unmanned systems ​ 135 161 ​ 269 331 Marine and land systems ​ 60 69 ​ 108 161 Simulation, training and other ​ 113 150 ​ 238 275 Textron Systems ​ 308 380 ​ 615 767 Fuel systems and functional components ​ 592 627 ​ 1,186 1,282 Specialized vehicles ​ 417 475 ​ 735 823 Tools and test equipment ​ — 120 ​ — 248 Industrial ​ 1,009 1,222 ​ 1,921 2,353 Finance ​ 16 17 ​ 33 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 ​ 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 June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,077 $ 279 $ 83 $ 1,004 $ 16 $ 2,459 U.S. Government ​ 46 ​ 492 ​ 225 ​ 5 ​ — ​ 768 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 736 $ 571 $ 249 $ 466 $ 7 $ 2,029 Europe ​ 164 ​ 47 ​ 17 ​ 291 ​ — ​ 519 Asia and Australia ​ 65 ​ 79 ​ 13 ​ 84 ​ 2 ​ 243 Other international ​ 158 ​ 74 ​ 29 ​ 168 ​ 7 ​ 436 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,191 $ 291 $ 107 $ 1,215 $ 17 $ 2,821 U.S. Government 85 540 273 7 — 905 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 914 $ 543 $ 297 $ 590 $ 7 $ 2,351 Europe ​ 128 ​ 50 ​ 23 ​ 372 ​ 2 ​ 575 Asia and Australia ​ 64 ​ 150 ​ 28 ​ 100 ​ 2 ​ 344 Other international 170 88 32 160 6 456 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,169 $ 509 $ 157 $ 1,909 $ 33 $ 4,777 U.S. Government ​ 88 ​ 1,001 ​ 458 ​ 12 ​ — ​ 1,559 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 1,525 $ 1,149 $ 506 $ 855 $ 15 $ 4,050 Europe ​ 347 ​ 67 ​ 40 ​ 602 ​ 1 ​ 1,057 Asia and Australia ​ 88 ​ 161 ​ 29 ​ 161 ​ 3 ​ 442 Other international ​ 297 ​ 133 ​ 40 ​ 303 ​ 14 ​ 787 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,164 $ 543 $ 234 $ 2,339 $ 33 $ 5,313 U.S. Government 122 1,040 533 14 — 1,709 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 1,579 $ 1,052 $ 584 $ 1,086 $ 14 $ 4,315 Europe ​ 274 ​ 77 ​ 35 ​ 755 ​ 3 ​ 1,144 Asia and Australia ​ 145 ​ 277 ​ 56 ​ 192 ​ 4 ​ 674 Other international 288 177 92 320 12 889 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 ​ 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 revenues 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 June 29, 2019, we had $9.3 billion in remaining performance obligations of which we expect to recognize revenues of approximately 68% through 2020, an additional 26% 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 June 29, 2019, contract assets and contract liabilities totaled $499 million and $897 million, respectively. At December 29, 2018, contract assets and contract liabilities totaled $461 million and $974 million, respectively. During the second quarter and first half of 2019, we recognized revenues of $146 million and $457 million, respectively, that were included in the contract liability balance at December 29, 2018. We recognized revenues of $377 million and $699 million in the second quarter and first half of 2018 that were included in the contract liability balance at December 31, 2017.

Retirement Plans

Retirement Plans	6 Months Ended
	Jun. 29, 2019
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: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Pension Benefits ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ 22 $ 27 $ 45 $ 53 Interest cost ​ 81 ​ 76 ​ 163 ​ 153 Expected return on plan assets ​ (139) (139) ​ (278) (277) Amortization of net actuarial loss ​ 25 ​ 39 ​ 50 ​ 77 Amortization of prior service cost ​ 4 3 ​ 7 7 Net periodic benefit cost (credit) $ (7) $ 6 $ (13) $ 13 Postretirement Benefits Other Than Pensions ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ — $ — $ 1 $ 1 Interest cost ​ 3 ​ 3 ​ 5 ​ 5 Amortization of net actuarial loss ​ (1) ​ — ​ (1) ​ — Amortization of prior service credit ​ (1) ​ (1) ​ (3) ​ (3) Net periodic benefit cost $ 1 $ 2 $ 2 $ 3 ​

Income Taxes

Income Taxes	6 Months Ended
	Jun. 29, 2019
Income Taxes	Note 14. Income Taxes ​ Our effective tax rate for the second quarter and first half of 2019 was 22.2% and 19.3%, respectively. In the first half 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. ​ Our effective tax rate for the second quarter and first half of 2018 was 13.8% and 13.6%, respectively. In the second quarter and first half of 2018, the effective tax rate was lower than the U.S. federal statutory tax rate of 21%, primarily due to a $25 million benefit recognized upon the reassessment of our reserve for uncertain tax positions based on new information, including interactions with the tax authorities and recent audit settlements. The effective tax rate for the first half of 2018 also reflects benefits recognized from audit settlements in the first quarter of 2018. ​ Our reserve for unrecognized tax benefits totaled $175 million and $141 million at June 29, 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	6 Months Ended
	Jun. 29, 2019
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)	6 Months Ended
	Jun. 29, 2019
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.

Accounts Receivable and Finan_2

Accounts Receivable and Finance Receivables (Tables)	6 Months Ended
	Jun. 29, 2019
Accounts receivable	​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Commercial $ 874 $ 885 U.S. Government contracts ​ 142 166 ​ ​ 1,016 1,051 Allowance for doubtful accounts ​ (27) (27) Total accounts receivable, net $ 989 $ 1,024
Finance receivables	​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables $ 802 $ 789 Allowance for losses ​ (26) (29) Total finance receivables, net $ 776 $ 760
Finance receivables by credit quality indicator and by delinquency aging category	​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, December 29, (Dollars in millions) 2019 2018 Performing $ 732 $ 704 Watchlist ​ 39 45 Nonaccrual ​ 31 40 Nonaccrual as a percentage of finance receivables ​ 3.87 % ​ 5.07 % Less than 31 days past due $ 726 $ 719 31-60 days past due ​ 64 ​ 56 61-90 days past due ​ 3 ​ 5 Over 90 days past due ​ 9 ​ 9 60+ days contractual delinquency as a percentage of finance receivables ​ 1.50 % ​ 1.77 %
Summary of finance receivables and allowance for loan losses based on impairment evaluation, excluding leveraged leases	​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finance receivables evaluated collectively $ 669 $ 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 $ 23 $ 43 Impaired finance receivables with related allowance for losses ​ 8 ​ 15 Unpaid principal balance of impaired finance receivables ​ 41 ​ 67 Average recorded investment of impaired finance receivables ​ 40 ​ 61 ​

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Jun. 29, 2019
Inventories	​ ​ ​ ​ ​ ​ ​ June 29, December 29, (In millions) 2019 2018 Finished goods $ 1,743 $ 1,662 Work in process ​ 1,771 1,356 Raw materials and components ​ 797 800 Total inventories $ 4,311 $ 3,818 ​

Warranty Liability (Tables)

Warranty Liability (Tables)	6 Months Ended
	Jun. 29, 2019
Warranty Liability
Changes in warranty liability	​ ​ ​ ​ ​ ​ ​ Six Months Ended ​ June 29, June 30, (In millions) 2019 2018 Beginning of period $ 149 $ 164 Provision 30 34 Settlements (38) (39) Adjustments* (5) 7 End of period $ 136 $ 166 * Adjustments include changes to prior year estimates, new issues on prior year sales, business dispositions, acquisitions and currency translation adjustments.

Leases (Tables)

Leases (Tables)	6 Months Ended
	Jun. 29, 2019
Leases
Schedule of balance sheet and other information	​ ​ ​ ​ ​ ​ June 29, (Dollars in millions) 2019 Operating leases: ​ ​ Other assets $ 298 Other current liabilities 53 Other liabilities 247 Finance leases: ​ Property, plant and equipment, less accumulated amortization of $51 million $ 116 Short-term and current portion of long-term debt 6 Long-term debt 77 Weighted-average remaining lease term (in years) ​ Finance leases 14.1 Operating leases 10.3 Weighted-average discount rate ​ Finance leases 2.73 % Operating leases 4.46 %
Summary of maturities of operating lease liabilities	​ ​ ​ ​ ​ ​ ​ Operating Finance (In millions) Leases Leases 2019 $ 34 $ 5 2020 57 9 2021 43 9 2022 37 9 2023 31 9 Thereafter 179 69 Total lease payments 381 110 Less: interest (81) (27) Total lease liabilities $ 300 $ 83
Summary of maturities of finance lease liabilities	​ ​ ​ ​ ​ ​ ​ ​ Operating Finance (In millions) Leases Leases 2019 $ 34 $ 5 2020 57 9 2021 43 9 2022 37 9 2023 31 9 Thereafter 179 69 Total lease payments 381 110 Less: interest (81) (27) Total lease liabilities $ 300 $ 83 ​ ​

Derivative Instruments and Fa_2

Derivative Instruments and Fair Value Measurements (Tables)	6 Months Ended
	Jun. 29, 2019
Carrying value and estimated fair value of financial instruments	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 December 29, 2018 ​ Carrying Estimated Carrying Estimated (In millions) Value Fair Value Value Fair Value Manufacturing group ​ ​ ​ ​ ​ ​ ​ ​ Debt, excluding leases $ (3,301) $ (3,414) $ (2,996) $ (2,971) Finance group ​ ​ ​ ​ ​ ​ ​ ​ Finance receivables, excluding leases 589 615 582 584 Debt (703) (640) (718) (640)

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	6 Months Ended
	Jun. 29, 2019
Schedule of Shareholder's equity	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Total ​ Common Capital Treasury Retained Comprehensive Shareholders’ (In millions) Stock Surplus Stock Earnings Loss Equity Three months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,689 $ (331) $ 5,581 $ (1,736) $ 5,233 Net income ​ — ​ — ​ — ​ 217 ​ — ​ 217 Other comprehensive income ​ — ​ — ​ — ​ — ​ 21 ​ 21 Share-based compensation activity ​ — ​ 28 ​ — ​ — ​ — ​ 28 Dividends declared ​ — ​ — ​ — ​ (4) ​ — ​ (4) Purchases of common stock ​ — ​ — ​ (159) ​ — ​ — ​ (159) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,710 $ (392) $ 5,642 $ (1,301) $ 5,692 Net income — — — 224 — 224 Other comprehensive (loss) — — — — (42) (42) Share-based compensation activity — 64 — — — 64 Dividends declared — — — (5) — (5) Purchases of common stock — — (571) — — (571) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 30 $ 1,646 $ (129) $ 5,407 $ (1,762) $ 5,192 Net income ​ — ​ — ​ — ​ 396 ​ — ​ 396 Other comprehensive income ​ — ​ — ​ — ​ — ​ 47 ​ 47 Share-based compensation activity ​ — ​ 71 ​ — ​ — ​ — ​ 71 Dividends declared ​ — ​ — ​ — ​ (9) ​ — ​ (9) Purchases of common stock ​ — ​ — ​ (361) ​ — ​ — ​ (361) End of period $ 30 $ 1,717 $ (490) $ 5,794 $ (1,715) $ 5,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Beginning of period $ 33 $ 1,669 $ (48) $ 5,368 $ (1,375) $ 5,647 Adoption of ASC 606 — — — 90 — 90 Net income — — — 413 — 413 Other comprehensive income — — — — 32 32 Share-based compensation activity — 105 — — — 105 Dividends declared — — — (10) — (10) Purchases of common stock — — (915) — — (915) End of period $ 33 $ 1,774 $ (963) $ 5,861 $ (1,343) $ 5,362
Schedule of weighted-average shares outstanding for basic and diluted EPS	​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In thousands) 2019 2018 2019 2018 Basic weighted-average shares outstanding 232,013 253,904 233,426 257,200 Dilutive effect of stock options 1,532 3,273 1,567 3,262 Diluted weighted-average shares outstanding 233,545 257,177 234,993 260,462
Schedule of components of Accumulated Other Comprehensive Loss	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and Foreign Deferred Accumulated ​ Postretirement Currency Gains (Losses) Other ​ Benefits Translation on Hedge Comprehensive (In millions) Adjustments Adjustments Contracts Loss Balance at December 29, 2018 $ (1,727) $ (32) $ (3) $ (1,762) Other comprehensive income before reclassifications ​ — ​ 4 ​ 4 ​ 8 Reclassified from Accumulated other comprehensive loss ​ 41 ​ — ​ (2) ​ 39 Balance at June 29, 2019 $ (1,686) $ (28) $ (1) $ (1,715) Balance at December 30, 2017 $ (1,396) $ 11 $ 10 $ (1,375) Other comprehensive income before reclassifications — (27) (2) (29) Reclassified from Accumulated other comprehensive loss 62 — (1) 61 Balance at June 30, 2018 $ (1,334) $ (16) $ 7 $ (1,343)
Schedule of before and after-tax components of other comprehensive income (loss)	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ June 29, 2019 June 30, 2018 ​ ​ ​ Tax ​ ​ ​ Tax ​ ​ Pre-Tax (Expense) After-Tax Pre-Tax (Expense) After-Tax (In millions) Amount Benefit Amount Amount Benefit Amount Three Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 24 $ (6) $ 18 $ 39 $ (9) $ 30 Amortization of prior service cost* 3 (1) 2 ​ 2 ​ (1) ​ 1 Pension and postretirement benefits adjustments, net 27 (7) 20 ​ 41 ​ (10) ​ 31 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 2 (1) 1 ​ (4) ​ 1 ​ (3) Reclassification adjustments (1) — (1) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net ​ 1 ​ (1) ​ — ​ (5) ​ 1 ​ (4) Foreign currency translation adjustments ​ 3 ​ (2) ​ 1 ​ (66) ​ (3) ​ (69) Total $ 31 $ (10) $ 21 $ (30) $ (12) $ (42) Six Months Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension and postretirement benefits adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortization of net actuarial loss* $ 49 $ (11) $ 38 $ 77 $ (18) $ 59 Amortization of prior service cost* 4 (1) 3 ​ 4 ​ (1) ​ 3 Pension and postretirement benefits adjustments, net 53 (12) 41 ​ 81 ​ (19) ​ 62 Deferred gains (losses) on hedge contracts: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current deferrals 6 (2) 4 ​ (2) ​ — ​ (2) Reclassification adjustments (2) — (2) ​ (1) ​ — ​ (1) Deferred gains (losses) on hedge contracts, net 4 (2) 2 ​ (3) ​ — ​ (3) Foreign currency translation adjustments 4 — 4 ​ (26) ​ (1) ​ (27) Total $ 61 $ (14) $ 47 $ 52 $ (20) $ 32 *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)	6 Months Ended
	Jun. 29, 2019
Revenues by segment and reconciliation of segment profit to income before income taxes	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Revenues ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 1,123 $ 1,276 $ 2,257 $ 2,286 Bell ​ 771 831 ​ 1,510 ​ 1,583 Textron Systems ​ 308 380 ​ 615 ​ 767 Industrial ​ 1,009 1,222 ​ 1,921 ​ 2,353 Finance ​ 16 17 ​ 33 ​ 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 Segment Profit ​ ​ ​ ​ ​ ​ ​ ​ Textron Aviation $ 105 $ 104 $ 211 $ 176 Bell ​ 103 117 ​ 207 ​ 204 Textron Systems ​ 49 40 ​ 77 ​ 90 Industrial ​ 76 80 ​ 126 ​ 144 Finance ​ 6 5 ​ 12 ​ 11 Segment profit ​ 339 346 ​ 633 ​ 625 Corporate expenses and other, net ​ (24) (51) (71) ​ (78) Interest expense, net for Manufacturing group (36) (35) (71) ​ (69) Income before income taxes $ 279 $ 260 $ 491 $ 478 ​

Revenues (Tables)

Revenues (Tables)	6 Months Ended
	Jun. 29, 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 Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Aircraft $ 733 $ 877 $ 1,499 $ 1,511 Aftermarket parts and services ​ 390 399 ​ 758 775 Textron Aviation ​ 1,123 1,276 ​ 2,257 2,286 Military aircraft and support programs ​ 482 533 ​ 990 1,020 Commercial helicopters, parts and services ​ 289 298 ​ 520 563 Bell ​ 771 831 ​ 1,510 1,583 Unmanned systems ​ 135 161 ​ 269 331 Marine and land systems ​ 60 69 ​ 108 161 Simulation, training and other ​ 113 150 ​ 238 275 Textron Systems ​ 308 380 ​ 615 767 Fuel systems and functional components ​ 592 627 ​ 1,186 1,282 Specialized vehicles ​ 417 475 ​ 735 823 Tools and test equipment ​ — 120 ​ — 248 Industrial ​ 1,009 1,222 ​ 1,921 2,353 Finance ​ 16 17 ​ 33 33 Total revenues $ 3,227 $ 3,726 $ 6,336 $ 7,022 ​ 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 June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,077 $ 279 $ 83 $ 1,004 $ 16 $ 2,459 U.S. Government ​ 46 ​ 492 ​ 225 ​ 5 ​ — ​ 768 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 736 $ 571 $ 249 $ 466 $ 7 $ 2,029 Europe ​ 164 ​ 47 ​ 17 ​ 291 ​ — ​ 519 Asia and Australia ​ 65 ​ 79 ​ 13 ​ 84 ​ 2 ​ 243 Other international ​ 158 ​ 74 ​ 29 ​ 168 ​ 7 ​ 436 Total revenues $ 1,123 $ 771 $ 308 $ 1,009 $ 16 $ 3,227 Three months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 1,191 $ 291 $ 107 $ 1,215 $ 17 $ 2,821 U.S. Government 85 540 273 7 — 905 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 914 $ 543 $ 297 $ 590 $ 7 $ 2,351 Europe ​ 128 ​ 50 ​ 23 ​ 372 ​ 2 ​ 575 Asia and Australia ​ 64 ​ 150 ​ 28 ​ 100 ​ 2 ​ 344 Other international 170 88 32 160 6 456 Total revenues $ 1,276 $ 831 $ 380 $ 1,222 $ 17 $ 3,726 Six months ended June 29, 2019 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,169 $ 509 $ 157 $ 1,909 $ 33 $ 4,777 U.S. Government ​ 88 ​ 1,001 ​ 458 ​ 12 ​ — ​ 1,559 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Geographic location: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ United States $ 1,525 $ 1,149 $ 506 $ 855 $ 15 $ 4,050 Europe ​ 347 ​ 67 ​ 40 ​ 602 ​ 1 ​ 1,057 Asia and Australia ​ 88 ​ 161 ​ 29 ​ 161 ​ 3 ​ 442 Other international ​ 297 ​ 133 ​ 40 ​ 303 ​ 14 ​ 787 Total revenues $ 2,257 $ 1,510 $ 615 $ 1,921 $ 33 $ 6,336 Six months ended June 30, 2018 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer type: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial $ 2,164 $ 543 $ 234 $ 2,339 $ 33 $ 5,313 U.S. Government 122 1,040 533 14 — 1,709 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 Geographic location: ​ ​ ​ ​ ​ ​ United States $ 1,579 $ 1,052 $ 584 $ 1,086 $ 14 $ 4,315 Europe ​ 274 ​ 77 ​ 35 ​ 755 ​ 3 ​ 1,144 Asia and Australia ​ 145 ​ 277 ​ 56 ​ 192 ​ 4 ​ 674 Other international 288 177 92 320 12 889 Total revenues $ 2,286 $ 1,583 $ 767 $ 2,353 $ 33 $ 7,022 ​

Retirement Plans (Tables)

Retirement Plans (Tables)	6 Months Ended
	Jun. 29, 2019
Components of net periodic benefit cost (credit)	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended Six Months Ended ​ June 29, June 30, June 29, June 30, (In millions) 2019 2018 2019 2018 Pension Benefits ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ 22 $ 27 $ 45 $ 53 Interest cost ​ 81 ​ 76 ​ 163 ​ 153 Expected return on plan assets ​ (139) (139) ​ (278) (277) Amortization of net actuarial loss ​ 25 ​ 39 ​ 50 ​ 77 Amortization of prior service cost ​ 4 3 ​ 7 7 Net periodic benefit cost (credit) $ (7) $ 6 $ (13) $ 13 Postretirement Benefits Other Than Pensions ​ ​ ​ ​ ​ ​ ​ ​ Service cost $ — $ — $ 1 $ 1 Interest cost ​ 3 ​ 3 ​ 5 ​ 5 Amortization of net actuarial loss ​ (1) ​ — ​ (1) ​ — Amortization of prior service credit ​ (1) ​ (1) ​ (3) ​ (3) Net periodic benefit cost $ 1 $ 2 $ 2 $ 3 ​

Basis of Presentation (Details)

Basis of Presentation (Details) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019USD ($)$ / shares	Jun. 30, 2018USD ($)$ / shares	Jun. 29, 2019USD ($)item$ / shares	Jun. 30, 2018USD ($)$ / shares
Number of borrowing groups | item			2
Cumulative catch-up method
Cumulative catch-up adjustments	$ 27	$ 64	$ 58	$ 104
Change in accounting estimate financial effect increase in net income	$ 21	$ 49	$ 44	$ 79
Change in accounting estimate financial effect increase in earnings per share diluted | $ / shares	$ 0.09	$ 0.19	$ 0.19	$ 0.30
Gross favorable adjustments	$ 46	$ 70	$ 99	$ 126
Gross unfavorable adjustments	$ 19	$ 6	$ 41	$ 22

Summary of Significant Accoun_3

Summary of Significant Accounting Policies Update (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 29, 2019	Jan. 01, 2019
Summary of Significant Accounting Policies Update
Operating right-of-use assets	$ 298
Operating lease liabilities	$ 300
Lease, Practical Expedient, Use of Hindsight [true false]	true
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	Jun. 29, 2019	Dec. 29, 2018
Accounts Receivable
Accounts Receivable, Gross	$ 1,016	$ 1,051
Allowance for doubtful accounts	(27)	(27)
Total accounts receivable, net	989	1,024
Commercial
Accounts Receivable
Accounts Receivable, Gross	874	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	Jun. 29, 2019	Dec. 29, 2018
Finance Receivables
Finance receivables	$ 802	$ 789
Allowance for losses	(26)	(29)
Total finance receivables, net	$ 776	$ 760

Accounts Receivable and Finan_5

Accounts Receivable and Finance Receivables - Finance receivables by delinquency aging category (Details) $ in Millions	6 Months Ended
	Jun. 29, 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	1.50%	1.77%
Less than 31 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	$ 726	$ 719
31-60 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	64	56
61- 90 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	3	5
Over 90 days past due
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	9	9
Performing
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	732	704
Watchlist
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	39	45
Nonaccrual
Finance receivables categorized based on the internally assigned credit quality
Total finance receivables	$ 31	$ 40
Nonaccrual as a percentage of finance receivables	3.87%	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	6 Months Ended	12 Months Ended
	Jun. 29, 2019	Dec. 29, 2018
Finance receivables
Finance receivables evaluated collectively	$ 669	$ 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	23	43
Impaired finance receivables with related allowance for losses	8	15
Unpaid principal balance of impaired finance receivables	41	67
Average recorded investment of impaired finance receivables	$ 40	$ 61

Inventories (Details)

Inventories (Details) - USD ($) $ in Millions	Jun. 29, 2019	Dec. 29, 2018
Inventories
Finished goods	$ 1,743	$ 1,662
Work in process	1,771	1,356
Raw materials and components	797	800
Total inventories	$ 4,311	$ 3,818

Other Assets (Details)

Other Assets (Details) $ in Millions	Apr. 01, 2019USD ($)
Equity method investment
Contributed assets	$ 69
Allocated goodwill	71
Amount of net pre-tax gain subject to post-closing adjustments	$ 18
FlightSafety Textron Aviation Training LLC
Equity method investment
Investment (in percentage)	30.00%

Warranty Liability (Details)

Warranty Liability (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018
Changes in warranty liability
Balance at beginning of period	$ 149	$ 164
Provision	30	34
Settlements	(38)	(39)
Adjustments	(5)	7
Balance at end of period	$ 136	$ 166

Leases (Details)

Leases (Details) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 29, 2019USD ($)	Jun. 29, 2019USD ($)
Leases
Operating lease - Option to extend		true
Operating lease cost	$ 16	$ 32
Cash paid for operating lease liabilities		$ 32
Maximum
Leases
Operating lease and finance lease - Remaining lease term		30 years
Operating lease - Option to extend the lease, term	25 years	25 years

Leases - Balance sheet and othe

Leases - Balance sheet and other information (Details) - USD ($) $ in Millions	Jun. 29, 2019	Dec. 29, 2018
Operating leases:
Other assets	$ 298
Other assets	us-gaap:OtherAssets
Other current liabilities	$ 53
Other current liabilities	us-gaap:OtherLiabilitiesCurrent
Other liabilities	$ 247
Other liabilities	us-gaap:OtherLiabilities
Finance leases:
Property, plant and equipment, less accumulated amortization of $51 million	$ 116
Property, plant and equipment, less accumulated amortization of $51 million	us-gaap:PropertyPlantAndEquipmentNet
Accumulated amortization	$ 4,317	$ 4,203
Short-term and current portion of long-term debt	$ 6
Short-term and current portion of long-term debt	us-gaap:DebtCurrent
Long-term debt	$ 77
Long-term debt	us-gaap:LongTermDebtAndCapitalLeaseObligations
Weighted-average remaining lease term (in years)
Finance leases	14 years 1 month 6 days
Operating leases	10 years 3 months 18 days
Weighted-average discount rate
Finance leases	2.73%
Operating leases	4.46%
Finance leased assets
Finance leases:
Accumulated amortization	$ 51

Leases - Maturity of lease liab

Leases - Maturity of lease liabilities (Details) $ in Millions	Jun. 29, 2019USD ($)
Operating Leases
2019	$ 34
2020	57
2021	43
2022	37
2023	31
Thereafter	179
Total lease payments	381
Less: interest	(81)
Total lease liabilities	300
Finance Leases
2019	5
2020	9
2021	9
2022	9
2023	9
Thereafter	69
Total lease payments	110
Less: interest	(27)
Total lease liabilities	$ 83

Debt (Details)

Debt (Details) - USD ($) $ in Millions	May 07, 2019	Jun. 24, 2019	Jun. 23, 2019
Fixed rate notes due 2029
Debt
Issuance of debt	$ 300
Interest rate (as a percent)	3.90%
Net proceeds from issuance	$ 297
Fixed rate notes due 2019
Debt
Interest rate (as a percent)		2.88%	2.26%
Loan		$ 150

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	6 Months Ended
	Jun. 29, 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	$ 395	$ 379
Level 2 | Foreign currency exchange contracts
Fair value of derivative instruments
Derivative Asset, Fair Value	2	2
Derivative Liability, Fair Value	$ 3	$ 10

Derivative Instruments and Fa_4

Derivative Instruments and Fair Value Measurements - Assets and liabilities not recorded at fair value (Details) - USD ($) $ in Millions	Jun. 29, 2019	Dec. 29, 2018
Manufacturing group | Carrying Value
Financial instruments not reflected at fair value
Debt, excluding leases	$ (3,301)	$ (2,996)
Manufacturing group | Estimated Fair Value
Financial instruments not reflected at fair value
Debt, excluding leases	(3,414)	(2,971)
Finance group
Financial instruments not reflected at fair value
Debt	(703)	(718)
Finance group | Carrying Value
Financial instruments not reflected at fair value
Finance receivables, excluding leases	589	582
Debt	(703)	(718)
Finance group | Estimated Fair Value
Financial instruments not reflected at fair value
Finance receivables, excluding leases	615	584
Debt	$ (640)	$ (640)

Shareholders' Equity (Details)

Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Increase (Decrease) in Stockholders' Equity
Beginning of period	$ 5,233	$ 5,692	$ 5,192	$ 5,647
Net income	217	224	396	413
Other comprehensive income (loss)	21	(42)	47	32
Share-based compensation activity	28	64	71	105
Dividends declared	(4)	(5)	(9)	(10)
Purchases of common stock	(159)	(571)	(361)	(915)
End of period	$ 5,336	$ 5,362	$ 5,336	$ 5,362
Dividends per share of common stock	$ 0.02	$ 0.02	$ 0.04	$ 0.04
Common Stock
Increase (Decrease) in Stockholders' Equity
Beginning of period	$ 30	$ 33	$ 30	$ 33
End of period	30	33	30	33
Capital Surplus
Increase (Decrease) in Stockholders' Equity
Beginning of period	1,689	1,710	1,646	1,669
Share-based compensation activity	28	64	71	105
End of period	1,717	1,774	1,717	1,774
Treasury Stock
Increase (Decrease) in Stockholders' Equity
Beginning of period	(331)	(392)	(129)	(48)
Purchases of common stock	(159)	(571)	(361)	(915)
End of period	(490)	(963)	(490)	(963)
Retained Earnings
Increase (Decrease) in Stockholders' Equity
Beginning of period	5,581	5,642	5,407	5,368
Net income	217	224	396	413
Dividends declared	(4)	(5)	(9)	(10)
End of period	5,794	5,861	5,794	5,861
Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity
Beginning of period	(1,736)	(1,301)	(1,762)	(1,375)
Other comprehensive income (loss)	21	(42)	47	32
End of period	$ (1,715)	$ (1,343)	$ (1,715)	(1,343)
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		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Weighted-average shares outstanding for basic and diluted EPS
Basic weighted-average shares outstanding	232,013	253,904	233,426	257,200
Dilutive effect of stock options	1,532	3,273	1,567	3,262
Diluted weighted-average shares outstanding	233,545	257,177	234,993	260,462
Anti-dilutive effect of weighted average shares	3,100	1,300	3,100	1,300

Shareholders' Equity - Componen

Shareholders' Equity - Components of accumulated other comprehensive loss (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018
Components of Accumulated Other Comprehensive Loss
Beginning of period	$ (1,762)
End of period	(1,715)
Accumulated Other Comprehensive Loss
Components of Accumulated Other Comprehensive Loss
Beginning of period	(1,762)	$ (1,375)
Other comprehensive income before reclassifications	8	(29)
Reclassified from Accumulated other comprehensive loss	39	61
End of period	(1,715)	(1,343)
Pension and Postretirement Benefits Adjustments
Components of Accumulated Other Comprehensive Loss
Beginning of period	(1,727)	(1,396)
Reclassified from Accumulated other comprehensive loss	41	62
End of period	(1,686)	(1,334)
Foreign Currency Translation Adjustments
Components of Accumulated Other Comprehensive Loss
Beginning of period	(32)	11
Other comprehensive income before reclassifications	4	(27)
End of period	(28)	(16)
Deferred Gains (Losses) on Hedge Contracts
Components of Accumulated Other Comprehensive Loss
Beginning of period	(3)	10
Other comprehensive income before reclassifications	4	(2)
Reclassified from Accumulated other comprehensive loss	(2)	(1)
End of period	$ (1)	$ 7

Shareholders' Equity - Before a

Shareholders' Equity - Before and after-tax components of other comprehensive income (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Pension and postretirement benefits adjustments, pre-tax:
Amortization of net actuarial loss, pre-tax	$ 24	$ 39	$ 49	$ 77
Amortization of prior service cost, pre-tax	3	2	4	4
Pension and postretirement benefits adjustments, net, pre-tax	27	41	53	81
Deferred gains (losses) on hedge contracts, pre-tax:
Current deferrals, pre-tax	2	(4)	6	(2)
Reclassification adjustments, pre-tax	(1)	(1)	(2)	(1)
Deferred gains (losses) on hedge contracts, net, pre-tax	1	(5)	4	(3)
Foreign currency translation adjustments, pre-tax:
Foreign currency translation adjustments, pre-tax	3	(66)	4	(26)
Other comprehensive income (loss), pre-tax	31	(30)	61	52
Pension and postretirement benefits adjustments, tax:
Amortization of net actuarial loss, tax	(6)	(9)	(11)	(18)
Amortization of prior service cost, tax	(1)	(1)	(1)	(1)
Pension and postretirement benefits adjustments, net, tax	(7)	(10)	(12)	(19)
Deferred gains (losses) on hedge contracts, tax:
Current deferrals, tax	(1)	1	(2)
Deferred gains (losses) on hedge contracts, net, tax	(1)	1	(2)
Foreign currency translation adjustments, tax:
Foreign currency translation adjustments, tax	(2)	(3)		(1)
Other comprehensive income (loss), tax	(10)	(12)	(14)	(20)
Pension and postretirement benefits adjustments, after-tax:
Amortization of net actuarial loss, after-tax	18	30	38	59
Amortization of prior service cost, after-tax	2	1	3	3
Pension and postretirement benefits adjustments, net, after-tax	20	31	41	62
Deferred gains (losses) on hedge contracts, after-tax:
Current deferrals, after-tax	1	(3)	4	(2)
Reclassification adjustments, after-tax	(1)	(1)	(2)	(1)
Deferred gains (losses) on hedge contracts, net, after-tax		(4)	2	(3)
Foreign currency translation adjustments, after-tax:
Foreign currency translation adjustments, after-tax	1	(69)	4	(27)
Other comprehensive income (loss)	$ 21	$ (42)	$ 47	$ 32

Segment Information - Operating

Segment Information - Operating and reportable segments (Details)	6 Months Ended
	Jun. 29, 2019segment
Operating and reportable business segments
Number of business operating segments	5
Number of reportable business segments	5

Segment Information - Revenue b

Segment Information - Revenue by segments and reconciliation of segment profit to income from continuing operations (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Revenues
Total revenues	$ 3,227	$ 3,726	$ 6,336	$ 7,022
Reconciliation of segment profit to income from continuing operations before income taxes
Income before income taxes	279	260	491	478
Operating Segment
Segment Profit
Segment Profit	339	346	633	625
Corporate
Reconciliation of segment profit to income from continuing operations before income taxes
Corporate expenses and other, net	(24)	(51)	(71)	(78)
Finance
Revenues
Finance Revenue	16	17	33	33
Finance | Operating Segment
Segment Profit
Segment Profit	6	5	12	11
Manufacturing group | Reconciling Items
Reconciliation of segment profit to income from continuing operations before income taxes
Interest expense, net for Manufacturing group	(36)	(35)	(71)	(69)
Manufacturing group | Textron Aviation
Revenues
Total revenues	1,123	1,276	2,257	2,286
Manufacturing group | Textron Aviation | Operating Segment
Segment Profit
Segment Profit	105	104	211	176
Manufacturing group | Bell
Revenues
Total revenues	771	831	1,510	1,583
Manufacturing group | Bell | Operating Segment
Segment Profit
Segment Profit	103	117	207	204
Manufacturing group | Textron Systems
Revenues
Total revenues	308	380	615	767
Manufacturing group | Textron Systems | Operating Segment
Segment Profit
Segment Profit	49	40	77	90
Manufacturing group | Industrial
Revenues
Total revenues	1,009	1,222	1,921	2,353
Manufacturing group | Industrial | Operating Segment
Segment Profit
Segment Profit	76	80	126	144
Finance group | Finance
Revenues
Finance Revenue	$ 16	$ 17	$ 33	$ 33

Revenues (Details)

Revenues (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Revenues
Total revenues	$ 3,227	$ 3,726	$ 6,336	$ 7,022
United States
Revenues
Total revenues	2,029	2,351	4,050	4,315
Europe
Revenues
Total revenues	519	575	1,057	1,144
Asia and Australia
Revenues
Total revenues	243	344	442	674
Other international
Revenues
Total revenues	436	456	787	889
Commercial
Revenues
Total revenues	2,459	2,821	4,777	5,313
U.S. Government
Revenues
Total revenues	768	905	1,559	1,709
Textron Aviation
Revenues
Total revenues	1,123	1,276	2,257	2,286
Textron Aviation | United States
Revenues
Total revenues	736	914	1,525	1,579
Textron Aviation | Europe
Revenues
Total revenues	164	128	347	274
Textron Aviation | Asia and Australia
Revenues
Total revenues	65	64	88	145
Textron Aviation | Other international
Revenues
Total revenues	158	170	297	288
Textron Aviation | Commercial
Revenues
Total revenues	1,077	1,191	2,169	2,164
Textron Aviation | U.S. Government
Revenues
Total revenues	46	85	88	122
Textron Aviation | Aircraft
Revenues
Total revenues	733	877	1,499	1,511
Textron Aviation | Aftermarket parts and services
Revenues
Total revenues	390	399	758	775
Bell
Revenues
Total revenues	771	831	1,510	1,583
Bell | United States
Revenues
Total revenues	571	543	1,149	1,052
Bell | Europe
Revenues
Total revenues	47	50	67	77
Bell | Asia and Australia
Revenues
Total revenues	79	150	161	277
Bell | Other international
Revenues
Total revenues	74	88	133	177
Bell | Commercial
Revenues
Total revenues	279	291	509	543
Bell | U.S. Government
Revenues
Total revenues	492	540	1,001	1,040
Bell | Military aircraft and support programs
Revenues
Total revenues	482	533	990	1,020
Bell | Commercial helicopters, parts and services
Revenues
Total revenues	289	298	520	563
Textron Systems
Revenues
Total revenues	308	380	615	767
Textron Systems | United States
Revenues
Total revenues	249	297	506	584
Textron Systems | Europe
Revenues
Total revenues	17	23	40	35
Textron Systems | Asia and Australia
Revenues
Total revenues	13	28	29	56
Textron Systems | Other international
Revenues
Total revenues	29	32	40	92
Textron Systems | Commercial
Revenues
Total revenues	83	107	157	234
Textron Systems | U.S. Government
Revenues
Total revenues	225	273	458	533
Textron Systems | Unmanned systems
Revenues
Total revenues	135	161	269	331
Textron Systems | Marine and land systems
Revenues
Total revenues	60	69	108	161
Textron Systems | Simulation, training and other
Revenues
Total revenues	113	150	238	275
Industrial
Revenues
Total revenues	1,009	1,222	1,921	2,353
Industrial | United States
Revenues
Total revenues	466	590	855	1,086
Industrial | Europe
Revenues
Total revenues	291	372	602	755
Industrial | Asia and Australia
Revenues
Total revenues	84	100	161	192
Industrial | Other international
Revenues
Total revenues	168	160	303	320
Industrial | Commercial
Revenues
Total revenues	1,004	1,215	1,909	2,339
Industrial | U.S. Government
Revenues
Total revenues	5	7	12	14
Industrial | Fuel systems and functional components
Revenues
Total revenues	592	627	1,186	1,282
Industrial | Specialized vehicles
Revenues
Total revenues	417	475	735	823
Industrial | Tools and test equipment
Revenues
Total revenues		120		248
Finance
Revenues
Finance Revenue	16	17	33	33
Finance | United States
Revenues
Finance Revenue	7	7	15	14
Finance | Europe
Revenues
Finance Revenue		2	1	3
Finance | Asia and Australia
Revenues
Finance Revenue	2	2	3	4
Finance | Other international
Revenues
Finance Revenue	7	6	14	12
Finance | Commercial
Revenues
Finance Revenue	$ 16	$ 17	$ 33	$ 33

Revenues - Remaining Performanc

Revenues - Remaining Performance Obligations (Details) $ in Billions	Jun. 29, 2019USD ($)
Remaining performance obligations	$ 9.3

Revenues - Remaining Performa_2

Revenues - Remaining Performance Obligations & Revenue Expected to be recognized (Details)	Jun. 29, 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	68.00%
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	26.00%

Revenues - Contract Assets and

Revenues - Contract Assets and Liabilities (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018	Dec. 29, 2018
Contract Assets and Liabilities
Contract assets	$ 499		$ 499		$ 461
Contract liabilities	897		897		$ 974
Revenue recognized included in contract liabilities	$ 146	$ 377	$ 457	$ 699

Retirement Plans - Net periodic

Retirement Plans - Net periodic benefit cost (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Pension Benefits
Net periodic benefit cost
Service cost	$ 22	$ 27	$ 45	$ 53
Interest cost	81	76	163	153
Expected return on plan assets	(139)	(139)	(278)	(277)
Amortization of net actuarial loss	25	39	50	77
Amortization of prior service cost (credit)	4	3	7	7
Net periodic benefit cost (credit)	(7)	6	(13)	13
Postretirement Benefits Other Than Pensions
Net periodic benefit cost
Service cost			1	1
Interest cost	3	3	5	5
Amortization of net actuarial loss	(1)		(1)
Amortization of prior service cost (credit)	(1)	(1)	(3)	(3)
Net periodic benefit cost (credit)	$ 1	$ 2	$ 2	$ 3

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018	Dec. 29, 2018
Income Taxes
Effective income tax rate (as a percent)	22.20%	13.80%	19.30%	13.60%
U.S. federal statutory income tax rate (as a percent)		21.00%	21.00%	21.00%
Discrete tax benefit		$ 25	$ 12	$ 25
Unrecognized tax benefits	$ 175		$ 175		$ 141