Cover Page
Cover Page - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2020 | Apr. 17, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Entity File Number | 001-00395 | |
Entity Registrant Name | NCR CORP | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 31-0387920 | |
Entity Address, Address Line One | 864 Spring Street NW | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30308 | |
City Area Code | 937 | |
Local Phone Number | 445-5000 | |
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 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | NCR | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding | 127.8 | |
Entity Central Index Key | 0000070866 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Document Transition Report | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total revenue | $ 1,503,000,000 | $ 1,536,000,000 |
Selling, general and administrative expenses | 255,000,000 | 252,000,000 |
Research and development expenses | 65,000,000 | 59,000,000 |
Total operating expenses | 1,426,000,000 | 1,436,000,000 |
Income (loss) from operations | 77,000,000 | 100,000,000 |
Interest expense | (50,000,000) | (45,000,000) |
Other expense, net | (2,000,000) | (8,000,000) |
Income (loss) from continuing operations before income taxes | 25,000,000 | 47,000,000 |
Income tax expense (benefit) | 1,000,000 | 9,000,000 |
Income (loss) from continuing operations | 24,000,000 | 38,000,000 |
Loss from discontinued operations, net of tax | 0 | 0 |
Net income (loss) | 24,000,000 | 38,000,000 |
Net income (loss) attributable to noncontrolling interests | 1,000,000 | 1,000,000 |
Net income (loss) attributable to NCR | 23,000,000 | 37,000,000 |
Amounts attributable to NCR common stockholders: | ||
Income (loss) from continuing operations | 23,000,000 | 37,000,000 |
Dividends on convertible preferred stock | (6,000,000) | (13,000,000) |
Income (loss) from continuing operations attributable to NCR common stockholders | 17,000,000 | 24,000,000 |
Loss from discontinued operations, net of tax | 0 | 0 |
Net income (loss) attributable to NCR common stockholders | $ 17,000,000 | $ 24,000,000 |
Income (loss) per common share from continuing operations | ||
Basic (in dollars per share) | $ 0.13 | $ 0.20 |
Diluted (in dollars per share) | 0.13 | 0.20 |
Net income (loss) per common share | ||
Basic (in dollars per share) | 0.13 | 0.20 |
Diluted (in dollars per share) | $ 0.13 | $ 0.20 |
Weighted average common shares outstanding | ||
Basic (in shares) | 128 | 119.3 |
Diluted (in shares) | 130.5 | 122.2 |
Product | ||
Total revenue | $ 474,000,000 | $ 539,000,000 |
Cost of revenue | 391,000,000 | 453,000,000 |
Services | ||
Total revenue | 1,029,000,000 | 997,000,000 |
Cost of revenue | $ 715,000,000 | $ 672,000,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 24 | $ 38 |
Currency translation adjustments | ||
Currency translation gains (losses) | (61) | 19 |
Derivatives | ||
Unrealized gains on derivatives | 3 | 1 |
Gains on derivatives recognized during the period | (1) | (1) |
Less income tax provision | 1 | |
Other Comprehensive Income (Loss), Securities, Available-for-Sale, Unrealized Holding Gain (Loss) Arising During Period, Tax | 0 | |
Employee benefit plans | ||
Amortization of prior service benefit | (1) | (2) |
Amortization of actuarial losses | (1) | (1) |
Less income tax benefit | 1 | 0 |
Other comprehensive income (loss) | (61) | 16 |
Total comprehensive income (loss) | (37) | 54 |
Less comprehensive income attributable to noncontrolling interests: | ||
Net income (loss) | 1 | 1 |
Currency translation adjustments | (1) | 0 |
Amounts attributable to noncontrolling interests | 0 | 1 |
Comprehensive income (loss) attributable to NCR | $ (37) | $ 53 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 1,214 | $ 509 |
Accounts receivable, net | 1,353 | 1,490 |
Inventories | 747 | 784 |
Other current assets | 463 | 361 |
Total current assets | 3,777 | 3,144 |
Property, plant and equipment, net | 399 | 413 |
Goodwill | 2,821 | 2,832 |
Intangibles, net | 580 | 607 |
Operating lease assets | 362 | 391 |
Prepaid pension cost | 176 | 178 |
Deferred Income Taxes and Other Assets, Noncurrent | 808 | 821 |
Other assets | 632 | 601 |
Total assets | 9,555 | 8,987 |
Current liabilities | ||
Short-term borrowings | 304 | 282 |
Accounts payable | 790 | 840 |
Payroll and benefits liabilities | 186 | 308 |
Contract with Customer, Liability, Current | 616 | 502 |
Other current liabilities | 510 | 606 |
Total current liabilities | 2,406 | 2,538 |
Long-term debt | 4,081 | 3,277 |
Pension and indemnity plan liabilities | 855 | 858 |
Postretirement and postemployment benefits liabilities | 112 | 111 |
Income tax accruals | 89 | 92 |
Operating lease liabilities | 346 | 369 |
Other liabilities | 244 | 240 |
Total liabilities | 8,133 | 7,485 |
Commitments and Contingencies (Note 8) | ||
Series A convertible preferred stock: par value $0.01 per share, 3.0 shares authorized, 0.4 and 0.4 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively; redemption amount and liquidation preference of $399 as of March 31, 2020 and December 31, 2019, respectively | 395 | 395 |
Stockholders’ equity | ||
Preferred stock: par value $0.01 per share, 100.0 shares authorized, no shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively | 0 | 0 |
Common stock: par value $0.01 per share, 500.0 shares authorized, 127.3 and 127.7 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively | 1 | 1 |
Paid-in capital | 275 | 312 |
Retained earnings | 1,077 | 1,060 |
Accumulated other comprehensive loss | (329) | (269) |
Total NCR stockholders’ equity | 1,024 | 1,104 |
Noncontrolling interests in subsidiaries | 3 | 3 |
Total stockholders’ equity | 1,027 | 1,107 |
Total liabilities and stockholders’ equity | $ 9,555 | $ 8,987 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Balance Sheet Parenthetical [Abstract] | ||
Series A convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Series A convertible preferred stock, authorized (in shares) | 3,000,000 | 3,000,000 |
Series A preferred shares, redemption amount | $ 399 | $ 399 |
Series A preferred shares, liquidation preference | $ 399 | $ 399 |
Series A convertible preferred stock, issued (in shares) | 400,000 | 400,000 |
Series A convertible preferred stock, outstanding (in shares) | 400,000 | 400,000 |
Stockholders' Equity: | ||
Preferred Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock shares authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred Stock shares issued (in shares) | 0 | 0 |
Preferred Stock shares outstanding (in shares) | 0 | 0 |
Common Stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common Stock shares issued (in shares) | 127,300,000 | 127,700,000 |
Common Stock shares outstanding (in shares) | 127,300,000 | 127,700,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Cash Flows [Abstract] | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash at end of period | $ 1,265 | $ 486 |
Operating activities | ||
Net income (loss) | 24 | 38 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Loss from discontinued operations | 0 | 0 |
Depreciation and amortization | 87 | 81 |
Stock-based compensation expense | 25 | 23 |
Deferred income taxes | 5 | (5) |
Goodwill and Long-Lived Intangible Asset Impairment | 1 | 0 |
Gain on sale of property, plant and equipment | (2) | 0 |
Changes in assets and liabilities: | ||
Receivables | 137 | 21 |
Inventories | (48) | (68) |
Current payables and accrued expenses | (183) | (192) |
Increase (Decrease) in Contract with Customer, Liability | 108 | 100 |
Employee benefit plans | (3) | (4) |
Other assets and liabilities | (90) | (10) |
Net cash provided by operating activities | 61 | (16) |
Investing activities | ||
Expenditures for property, plant and equipment | (10) | (22) |
Proceeds from sale of property, plant and equipment | 7 | 0 |
Additions to capitalized software | (69) | (43) |
Business acquisitions, net | (26) | (6) |
Net change in funds held for clients - investing | 0 | 0 |
Other investing activities, net | 0 | 3 |
Net Cash Provided by (Used in) Investing Activities | (98) | (68) |
Financing activities | ||
Short term borrowings, net | 3 | 7 |
Payments on term credit facilities | (2) | (17) |
Payments on revolving credit facilities | (573) | (375) |
Borrowings on revolving credit facilities | 1,397 | 430 |
Payments of Debt Issuance Costs | (1) | 0 |
Payments of Ordinary Dividends, Preferred Stock and Preference Stock | (6) | 0 |
Repurchases of Common Stock | (41) | 0 |
Proceeds from employee stock plans | 3 | 4 |
Tax withholding payments on behalf of employees | (24) | (13) |
Increase (Decrease) in Client Funds Held | 12 | 17 |
Proceeds from (Payments for) Other Financing Activities | (3) | 0 |
Net Cash Provided by (Used in) Financing Activities | 765 | 53 |
Cash flows from discontinued operations | ||
Net cash provided by (used in) operating activities | 3 | (6) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (14) | 1 |
Increase (decrease) in cash, cash equivalents, and restricted cash | 717 | (36) |
Cash, cash equivalents and restricted cash at beginning of period | 548 | 522 |
Cash, cash equivalents and restricted cash at end of period | $ 1,265 | $ 486 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows | |||||
Cash and cash equivalents | $ 1,214 | $ 509 | $ 414 | ||
Restricted cash included in other assets | 51 | 72 | 72 | ||
Total cash, cash equivalents and restricted cash | $ 1,265 | $ 548 | $ 486 | $ 522 | $ 522 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Total Stockholders Equity | Common Stock | Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Non-Redeemable Noncontrolling Interests in Subsidiaries | Parent Company [Member] |
Balance at beginning of period (in shares) at Dec. 31, 2018 | 119 | |||||||
Balance at beginning of period at Dec. 31, 2018 | $ 399 | $ 1 | $ 34 | $ 606 | $ (246) | $ 4 | ||
Comprehensive income: | ||||||||
Net income | 38 | 37 | 1 | |||||
Other comprehensive income | $ 16 | 16 | 16 | |||||
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Nonredeemable Noncontrolling Interest | 54 | 37 | 16 | 1 | ||||
Employee stock purchase and stock compensation plans (in shares) | 1 | |||||||
Employee stock purchase and stock compensation plans | 14 | 14 | ||||||
Series A convertible preferred stock dividends | (13) | (13) | ||||||
Balance at end of period (in shares) at Mar. 31, 2019 | 120 | |||||||
Balance at end of period at Mar. 31, 2019 | 454 | $ 1 | 48 | 630 | (230) | 5 | ||
Balance at beginning of period (in shares) at Dec. 31, 2019 | 127.7 | 127 | ||||||
Balance at beginning of period at Dec. 31, 2019 | $ 1,107 | 1,107 | $ 1 | 312 | 1,060 | (269) | 3 | $ 1,104 |
Comprehensive income: | ||||||||
Net income | 24 | 23 | 1 | |||||
Other comprehensive income | $ (61) | (61) | (60) | (1) | ||||
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Nonredeemable Noncontrolling Interest | (37) | 23 | (60) | 0 | ||||
Employee stock purchase and stock compensation plans (in shares) | 2 | |||||||
Employee stock purchase and stock compensation plans | 4 | 4 | ||||||
Series A convertible preferred stock dividends | (6) | (6) | ||||||
Repurchase of Company common stock (in shares) | (2) | |||||||
Repurchase of Company common stock | (41) | (41) | ||||||
Balance at end of period (in shares) at Mar. 31, 2020 | 127.3 | 127 | ||||||
Balance at end of period at Mar. 31, 2020 | $ 1,027 | $ 1,027 | $ 1 | $ 275 | $ 1,077 | $ (329) | $ 3 | $ 1,024 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying Condensed Consolidated Financial Statements have been prepared by NCR Corporation (NCR, the Company, we or us) without audit pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC) and, in the opinion of management, include all adjustments (consisting of normal, recurring adjustments, unless otherwise disclosed) necessary for a fair statement of the consolidated results of operations, financial position, and cash flows for each period presented. The consolidated results for the interim periods are not necessarily indicative of results to be expected for the full year. The 2019 year-end Condensed Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States (GAAP). These financial statements should be read in conjunction with NCR’s Form 10-K for the year ended December 31, 2019 . Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and revenue and expenses during the period reported. Actual results could differ from those estimates. Evaluation of Subsequent Events The Company evaluated subsequent events through the date that our Condensed Consolidated Financial Statements were issued. Except as described within Note 17, Subsequent Events , no matters were identified that required adjustment of the Condensed Consolidated Financial Statements or additional disclosure. Reclassifications Certain prior-period amounts have been reclassified in the accompanying Condensed Consolidated Financial Statements and Notes thereto in order to conform to the current period presentation. Reclassifications had no effect on prior year net income or shareholders’ equity. Contract Assets and Liabilities The following table presents the net contract asset and contract liability balances as of March 31, 2020 and December 31, 2019 . In millions Location in the Condensed Consolidated Balance Sheet March 31, 2020 December 31, 2019 Current portion of contract assets Other current assets $ 9 $ 9 Current portion of contract liabilities Contract liabilities $ 616 $ 502 Non-current portion of contract liabilities Other liabilities $ 75 $ 81 During the three months ended March 31, 2020 , the Company recognized $198 million in revenue that was included in contract liabilities as of December 31, 2019 . Remaining Performance Obligations Remaining performance obligations represent the transaction price of orders for which products have not been delivered or services have not been performed. As of March 31, 2020 , the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $4.0 billion . The Company expects to recognize revenue on approximately three-quarters of the remaining performance obligations over the next 12 months, with the remainder recognized thereafter. The majority of our professional services are expected to be recognized over the next 12 months but this is contingent upon a number of factors, including customers’ needs and schedules. The Company has made two elections that affect the value of remaining performance obligations described above. We do not disclose remaining performance obligations for Software as a Service (SaaS) contracts where variable consideration is directly allocated based on usage or when the original expected length is one year or less. Recent Accounting Pronouncements Issued In December 2019, the Financial Accounting Standards Board ("FASB") issued an accounting standards update with new guidance which removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. This accounting standards update also adds guidance to reduce complexity in certain areas, including recognizing measures for the accounting for income taxes. This accounting standards update is effective for fiscal years and interim periods beginning after December 15, 2020, with early adoption permitted. The Company is evaluating the impact that adopting this guidance will have on our consolidated financial statements. Adopted In June 2016, the FASB issued an accounting standards update with new guidance on accounting for credit losses on financial instruments. The new guidance includes an impairment model for estimating credit losses that is based on expected losses, rather than incurred losses. This accounting standards update is effective prospectively for fiscal years and interim periods beginning after December 15, 2019, with early adoption permitted. The adoption of this accounting standards update did not have a material effect on the Company's net income, cash flows or financial condition. In August 2018, the Financial Accounting Standards Board (FASB) issued an accounting standards update with new guidance on fair value measurement disclosure requirements that requires the disclosure of additions to and transfers into and out of Level 3 of the fair value hierarchy. This accounting standards update also requires disclosure about the uncertainty in measurement as of the reporting date. The new standard became effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted. The adoption of this accounting standards update did not have a material impact on our financial statement disclosures. |
Segment Information and Concent
Segment Information and Concentrations | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION AND CONCENTRATIONS | 2. SEGMENT INFORMATION AND CONCENTRATIONS The Company manages and reports the following segments: • Banking - We offer solutions to enable customers in the financial services industry to reduce costs, generate new revenue streams and enhance customer loyalty. These solutions include a comprehensive line of ATM and payment processing hardware and software; cash management and video banking software and customer-facing digital banking services; and related installation, maintenance, and managed and professional services. • Retail - We offer solutions to customers in the retail industry designed to improve selling productivity and checkout processes as well as increase service levels. The solutions offered serve the following customer markets in the retail industry: food, drug and mass merchandisers; department and specialty retailers; convenience and fuel retailers, and small and medium retailers. These solutions primarily include retail-oriented technologies, such as point of sale terminals and point of sale software; a retail software platform with a comprehensive suite of retail software applications; innovative self-service kiosks, such as self-checkout; as well as bar-code scanners. We also offer installation, maintenance, managed and professional services as well as payment processing solutions. • Hospitality - We offer solutions to customers in the hospitality industry, serving businesses in the following markets: quick service restaurants, table service restaurants, small and medium restaurants and travel and entertainment venues. Our solutions include point of sale hardware and software solutions, installation, maintenance, managed and professional services as well as payment processing solutions. • Other - This category includes telecommunications and technology solutions where we offer maintenance as well as managed and professional services for third-party hardware provided to select manufacturers who value and leverage our global service capability. These segments represent components of the Company for which separate financial information is available that is utilized on a regular basis by the chief operating decision maker in assessing segment performance and in allocating the Company's resources. Management evaluates the performance of the segments based on revenue and segment operating income. Assets are not allocated to segments, and thus are not included in the assessment of segment performance. Consequently, we do not disclose total assets by reportable segment. The accounting policies used to determine the results of the operating segments are the same as those utilized for the consolidated financial statements as a whole. Intersegment sales and transfers are not material. To maintain operating focus on business performance, non-operational items are excluded from the segment operating results utilized by our chief operating decision maker in evaluating segment performance and are separately delineated to reconcile back to total reported income from operations. The following table presents revenue and operating income by segment: In millions Three months ended March 31 2020 2019 Revenue by segment Banking $ 763 $ 758 Retail 472 511 Hospitality 169 193 Other 99 74 Consolidated revenue $ 1,503 $ 1,536 Operating income by segment Banking $ 103 $ 95 Retail 5 26 Hospitality (9 ) 16 Other 5 10 Subtotal - segment operating income 104 147 Other adjustments (1) 27 47 Income from operations $ 77 $ 100 (1) The following table presents the other adjustments for NCR: In millions Three months ended March 31 2020 2019 Transformation and restructuring costs $ 5 $ 26 Acquisition-related amortization of intangible assets 22 21 Total other adjustments $ 27 $ 47 The following table presents revenue by geography for NCR: In millions Three months ended March 31 2020 2019 Americas $ 892 $ 920 Europe, Middle East and Africa (EMEA) 403 419 Asia Pacific (APJ) 208 197 Total revenue $ 1,503 $ 1,536 The following tables present revenue from products and services for NCR: In millions Three months ended March 31 2020 2019 Product revenue $ 474 $ 539 Professional services and installation services revenue 227 238 Recurring revenue, including maintenance, cloud revenue and payments 802 759 Total revenue $ 1,503 $ 1,536 In millions Three months ended March 31 2020 2019 Software $ 474 $ 467 Services 636 585 Hardware 393 484 Total revenue $ 1,503 $ 1,536 |
Goodwill and Long-Lived Assets
Goodwill and Long-Lived Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND LONG-LIVED ASSETS | 3. GOODWILL AND LONG-LIVED ASSETS Hospitality Goodwill Assessment In addition to our annual goodwill impairment test performed in the fourth quarter, we perform interim impairment tests for long-lived and intangible assets, including goodwill, whenever events or changes in circumstances indicate that the carrying amount of the asset (group) may not be recoverable. Late in the quarter ended March 31, 2020, there was significant market volatility driven by the novel coronavirus (COVID-19) pandemic which drove uncertainty around our full year revenue and operating income expectations. As a result, we withdrew our full year outlook for 2020 on March 31, 2020, which was previously provided during our fourth quarter 2019 earnings conference call on February 11, 2020. Given the rapidly changing environment, we considered if there was an indication the carrying value of net assets were in excess of the fair value for each of our reporting units. This consideration included the expected impacts to the current year cash flows, the potential impacts to future cash flows as well as the excess of the fair value over the carrying value from the prior year annual assessment. As a result, we determined there was an indication that the carrying value of the net assets assigned to the Hospitality reporting unit may not be recoverable. The fair value of the Hospitality reporting unit was estimated using a weighted methodology considering the output from both the income and market approaches. The income approach incorporates the use of discounted cash flow (DCF) analysis. A number of significant assumptions and estimates are involved in the application of the discounted cash flow model to forecast operating cash flows, including revenue growth, operating income margin and discount rate. The market approach is performed using the Guideline Public Companies (GPC) method which is based on earnings multiple data of peer companies. For the Hospitality reporting unit, the Company expects the COVID-19 pandemic to have a significant impact to our customers in the table service market, travel and entertainment market and small and medium business market in the near term. The Company expects the long term growth strategy to remain intact with previous growth expectations returning in 2021. Based on these assumptions, the Company determined the fair value of the Hospitality segment continues to be greater than the carrying value and therefore, no impairment existed as of March 31, 2020. However, if the actual results or the anticipated timing of the recovery from the COVID-19 pandemic differ from our expectations for the Hospitality, or any, reporting unit, there is a possibility we would have to perform another interim impairment test in 2020, which could lead to an impairment of goodwill or other assets. Goodwill by Segment The carrying amounts of goodwill by segment as of March 31, 2020 and December 31, 2019 are included in the table below. Foreign currency fluctuations are included within other adjustments . December 31, 2019 March 31, 2020 In millions Goodwill Accumulated Impairment Losses Total Additions Impairment Other Goodwill Accumulated Impairment Losses Total Banking $ 1,774 $ (101 ) $ 1,673 $ — $ — $ (3 ) $ 1,771 $ (101 ) $ 1,670 Retail 638 (34 ) 604 — — (9 ) 629 (34 ) 595 Hospitality 402 (23 ) 379 3 — (2 ) 403 (23 ) 380 Other 187 (11 ) 176 — — — 187 (11 ) 176 Total goodwill $ 3,001 $ (169 ) $ 2,832 $ 3 $ — $ (14 ) $ 2,990 $ (169 ) $ 2,821 Identifiable Intangible Assets NCR's purchased intangible assets, reported in intangibles, net in the Condensed Consolidated Balance Sheets, were specifically identified when acquired, and are deemed to have finite lives. The gross carrying amount and accumulated amortization for NCR’s identifiable intangible assets were as set forth in the table below. Amortization Period (in Years) March 31, 2020 December 31, 2019 In millions Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Identifiable intangible assets Reseller & customer relationships 1 - 20 $ 735 $ (284 ) $ 735 $ (270 ) Intellectual property 2 - 8 524 (403 ) 529 (397 ) Customer contracts 8 89 (89 ) 89 (89 ) Tradenames 1 - 10 78 (70 ) 78 (68 ) Total identifiable intangible assets $ 1,426 $ (846 ) $ 1,431 $ (824 ) The aggregate amortization expense (actual and estimated) for identifiable intangible assets for the following periods is: In millions Three months ended March 31, 2020 Remainder of 2020 (estimated) Amortization expense $ 22 $ 60 For the years ended December 31 (estimated) In millions 2021 2022 2023 2024 2025 Amortization expense $ 73 $ 68 $ 66 $ 59 $ 51 |
Debt Obligations
Debt Obligations | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
DEBT OBLIGATIONS | 4. DEBT OBLIGATIONS The following table summarizes the Company's short-term borrowings and long-term debt: March 31, 2020 December 31, 2019 In millions, except percentages Amount Weighted-Average Interest Rate Amount Weighted-Average Interest Rate Short-Term Borrowings Current portion of Senior Secured Credit Facility (1) $ 7 4.30% $ 8 4.30% Trade Receivables Securitization Facility 293 2.65% 270 2.65% Other (1) 4 4.25% 4 2.82% Total short-term borrowings $ 304 $ 282 Long-Term Debt Senior Secured Credit Facility: Term loan facility (1) $ 739 4.30% $ 740 4.30% Revolving credit facility (1) 1,070 3.77% 265 3.76% Senior notes: 5.00% Senior Notes due 2022 600 600 6.375% Senior Notes due 2023 700 700 5.750% Senior Notes due 2027 500 500 6.125% Senior Notes due 2029 500 500 Deferred financing fees (31 ) (32 ) Other (1) 3 —% 4 0.05% Total long-term debt $ 4,081 $ 3,277 (1) Interest rates are weighted-average interest rates as of March 31, 2020 and December 31, 2019 . Senior Secured Credit Facility On August 28, 2019, the Company entered into an amended and restated senior secured credit facility with and among certain subsidiaries of NCR (the Foreign Borrowers), the lenders party thereto and JPMorgan Chase Bank, NA (JPMCB) as the administrative agent, refinancing its term loan facility and revolving credit facility thereunder (the Senior Secured Credit Facility). The Senior Secured Credit Facility consists of a term loan facility with an aggregate principal commitment of $750 million , of which $746 million was outstanding as of March 31, 2020 . Additionally, the Senior Secured Credit Facility provides for a five-year revolving credit facility with an aggregate principal amount of $1.1 billion , of which $1.07 billion was outstanding as of March 31, 2020 . The revolving credit facility also allows a portion of the availability to be used for letters of credit, and as of March 31, 2020 , there were $28 million of letters of credit outstanding. Up to $400 million of the revolving credit facility is available to the Foreign Borrowers. Term loans were made to the Company in U.S. Dollars, and loans under the revolving credit facility are available in U.S. Dollars, Euros and Pound Sterling. The outstanding principal balance of the term loan facility is required to be repaid in equal quarterly installments of approximately 0.25% of the aggregate principal amount that began with the fiscal quarter ending December 31, 2019, with the balance being due at maturity on August 28, 2026. Borrowings under the revolving portion of the credit facility are due August 28, 2024. Revolving loans outstanding under the Senior Secured Credit Facility denominated in U.S. Dollars bear interest at the Company's option at (a) London Inter-bank Offered Rate ("LIBOR"), plus a margin ranging from 1.25% to 2.25% or (b) a base rate equal to the highest of (i) the federal funds rate plus 0.50% , (ii) the rate of interest last quoted by the Wall Street Journal as the “prime rate” and (iii) the one-month LIBOR rate plus 1.00% (the Base Rate), plus, a margin ranging from 0.25% to 1.25% , in each case, depending on the Company’s consolidated leverage ratio. Revolving loans denominated in Euro bear interest at the EURIBOR, plus a margin ranging from 1.25% to 2.25% depending on the Company’s consolidated leverage ratio. The terms of the Senior Secured Credit Facility also require certain other fees and payments to be made by the Company, including a commitment fee on the undrawn portion of the revolving credit facility. Term loans outstanding under the Senior Secured Credit Facility bear interest, at NCR's option, at LIBOR plus 2.50% per annum or the Base Rate plus a 1.50% margin per annum. In the event that LIBOR is no longer available or in certain other circumstances as described in the Senior Secured Credit Facility, the Senior Secured Credit Facility provides a mechanism for determining an alternative rate of interest. There is no assurance that any such alternative, successor or replacement reference rate will be similar to, or produce the same value or economic equivalence of, LIBOR. The obligations of the Company and Foreign Borrowers under the Senior Secured Credit Facility are guaranteed by certain of the Company's wholly-owned domestic subsidiaries. The Senior Secured Credit Facility and these guarantees are secured by a first priority lien and security interest in certain equity interests owned by the Company and the guarantor subsidiaries in certain of their respective domestic and foreign subsidiaries, and a perfected first priority lien and security interest in substantially all of the Company's U.S. assets and the assets of the guarantor subsidiaries, subject to certain exclusions. These security interests would be released if the Company achieves an “investment grade” rating and will remain released so long as the Company maintains that rating. The Senior Secured Credit Facility includes affirmative and negative covenants that restrict or limit the ability of the Company and its subsidiaries to, among other things, incur indebtedness; create liens on assets; engage in certain fundamental corporate changes or changes to the Company's business activities; make investments; sell or otherwise dispose of assets; engage in sale-leaseback or hedging transactions; repurchase stock, pay dividends or make similar distributions; repay other indebtedness; engage in certain affiliate transactions; or enter into agreements that restrict the Company's ability to create liens, pay dividends or make loan repayments. The Senior Secured Credit Facility also includes a financial covenant that require the Company to maintain: • a consolidated leverage ratio on the last day of any fiscal quarter, not to exceed (i) in the case of any fiscal quarter ending on or prior to March 31, 2021, (a) the sum of 4.50 and an amount (not to exceed 0.50 ) to reflect debt used to reduce NCR’s unfunded pension liabilities to (b) 1.00 , and (ii) in the case of any fiscal quarter ending after March 31, 2021 and on or prior to March 31, 2023, (a) the sum of 4.25 and an amount (not to exceed 0.50 ) to reflect debt used to reduce NCR’s unfunded pension liabilities to (b) 1.00 ; and (iii) in the case of any fiscal quarter ending after March 31, 2023, (a) the sum of 4.00 and an amount (not to exceed 0.50 ) to reflect debt used to reduce our unfunded pension liabilities to (b) 1.00 . The Company has the option to elect to increase the maximum permitted leverage ratio by 0.25 in connection with the consummation of any material acquisition (as defined in the Senior Secured Credit Facility) for four fiscal quarters, but in no event will the maximum permitted leverage ratio, inclusive of all increases, exceed 4.75 to 1.00 . At March 31, 2020 , the maximum consolidated leverage ratio under the Senior Secured Credit Facility was 4.75 to 1.00 . The Senior Secured Credit Facility also includes provisions for events of default, which are customary for similar financings. Upon the occurrence of an event of default, the lenders may, among other things, terminate the loan commitments, accelerate all loans and require cash collateral deposits in respect of outstanding letters of credit. If the Company is unable to pay or repay the amounts due, the lenders could, among other things, proceed against the collateral granted to them to secure such indebtedness. The Company may request, at any time and from time to time, but the lenders are not obligated to fund, the establishment of one or more incremental term loans and/or revolving credit facilities (subject to the agreement of existing lenders or additional financial institutions to provide such term loans and/or revolving credit facilities) with commitments in an aggregate amount not to exceed the greater of (i) $150 million , and (ii) such amount as would not cause the leverage ratio under the Senior Secured Credit Facility, calculated on a pro forma basis including the incremental facility and assuming that it and the revolver are fully drawn, to exceed 3.00 to 1.00, and the proceeds of which can be used for working capital requirements and other general corporate purposes. Senior Unsecured Notes On September 17, 2012, the Company issued $600 million aggregate principal amount of 5.00% senior unsecured notes due in 2022 (the 5.00% Notes). The 5.00% Notes were sold at 100% of the principal amount and will mature on July 15, 2022. On December 19, 2013, the Company issued $700 million aggregate principal amount of 6.375% senior unsecured notes due in 2023 (the 6.375% Notes). The 6.375% Notes were sold at 100% of the principal amount and will mature on December 15, 2023. On August 21, 2019, the Company issued $500 million aggregate principal amount of 5.750% senior unsecured notes due in 2027 (the 5.750% Notes) and $500 million aggregate principal amount of 6.125% senior unsecured notes due in 2029 (the 6.125% Notes). The 5.750% Notes were sold at 100% of the principal amount and will mature on September 1, 2027. The 6.125% Notes were sold at 100% of the principal amount and will mature on September 1, 2029. Subsequent to the end of the quarter, on April 13, 2020, the Company issued $400 million aggregate principal amount of 8.125% senior unsecured notes due in 2025. Refer to Note 17, Subsequent Events for further disclosure regarding the debt offering. The senior unsecured notes are guaranteed, fully and unconditionally, on an unsecured senior basis, by our 100% owned subsidiary, NCR International, Inc. The terms of the indentures for these notes limit the ability of the Company and certain of its subsidiaries to, among other things, incur additional debt or issue redeemable preferred stock; pay dividends or make certain other restricted payments or investments; incur liens; sell assets; incur restrictions on the ability of the Company's subsidiaries to pay dividends to the Company; enter into affiliate transactions; engage in sale and leaseback transactions; and consolidate, merge, sell or otherwise dispose of all or substantially all of the Company's or such subsidiaries' assets. These covenants are subject to significant exceptions and qualifications. For example, if these notes are assigned an "investment grade" rating by Moody's or S&P and no default has occurred or is continuing, certain covenants will be terminated. Trade Receivables Securitization Facility In November 2014, the Company established a revolving trade receivables securitization facility (the A/R Facility) with PNC Bank, National Association (PNC) as the administrative agent, and various lenders. In November 2019, the Company amended the A/R Facility to increase the maximum commitment made available under the Facility and extended the maturity date to November 2021. The amendment also included other modifications including the scope of receivables subject to the facility and related eligibility requirements, the adoption of a new benchmark for determining overnight funding rates and the fees and interest payable to the agent and lenders party thereto. The A/R Facility now provides for up to $300 million in funding based on the availability of eligible receivables and other customary factors and conditions, of which $293 million was outstanding as of March 31, 2020 . Under the A/R Facility, NCR sells and/or contributes certain of its U.S. trade receivables to a wholly-owned, bankruptcy-remote subsidiary as they are originated, and advances by the lenders to that subsidiary are secured by those trade receivables. The assets of this financing subsidiary are restricted as collateral for the payment of its obligations under the A/R Facility, and its assets and credit are not available to satisfy the debts and obligations owed to the creditors of the Company. The Company includes the assets, liabilities and results of operations of this financing subsidiary in its consolidated financial statements. The financing subsidiary owned $548 million and $603 million of outstanding accounts receivable as of March 31, 2020 and December 31, 2019 , respectively, and these amounts are included in accounts receivable, net in the Company’s Condensed Consolidated Balance Sheets. The financing subsidiary will pay annual commitments and other customary fees to the lenders, and advances by a lender under the A/R Facility will accrue interest (i) at a reserve-adjusted LIBOR rate or a base rate equal to the highest of (a) the applicable lender’s prime rate or (b) the federal funds rate plus 0.50% , if the lender is funding as a committed lender under the terms of the A/R Facility, or (ii) based on commercial paper interest rates if the lender is funding as a commercial paper conduit lender. Advances may be prepaid at any time without premium or penalty. The A/R Facility contains various customary affirmative and negative covenants and default and termination provisions which provide for the acceleration of the advances under the A/R Facility in circumstances including, but not limited to, failure to pay interest or principal when due, breach of representation, warranty or covenant, certain insolvency events or failure to maintain the security interest in the trade receivables, and defaults under other material indebtedness. Fair Value of Debt The Company utilized Level 2 inputs, as defined in the fair value hierarchy, to measure the fair value of the long-term debt, which, as of March 31, 2020 and December 31, 2019 was $4.22 billion and $3.70 billion , respectively. Management's fair value estimates were based on quoted prices for recent trades of NCR’s long-term debt, quoted prices for similar instruments, and inquiries with certain investment communities. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 5. INCOME TAXES Income tax provisions for interim (quarterly) periods are based on an estimated annual effective income tax rate calculated separately from the effect of significant, infrequent or unusual items. Income tax expense was $1 million for the three months ended March 31, 2020 compared to income tax expense of $9 million for the three months ended March 31, 2019 . The change was primarily driven by lower income before taxes and an increase in discrete tax benefits in the three months ended March 31, 2020 . In connection with preparing the financial statements for the quarter ended March 31, 2020 , the Company identified and recorded income tax benefits of $2 million related to an error in the calculation of the permanent differences on executive stock compensation and $3 million for the write-off of income tax payables incorrectly recorded in prior periods. The Company determined the impact of these errors were not material to the annual or interim financial statements of previous periods and the effect of correcting these errors was not material to the Condensed Consolidated Financial Statements for the three months ended March 31, 2020 and is not expected to be material to the 2020 annual financial statements. The Company engages in continuous discussions and negotiations with taxing authorities regarding tax matters, and the Company has determined that over the next 12 months it expects to resolve certain tax matters related to U.S. and foreign jurisdictions. As a result, as of March 31, 2020 , we estimate that it is reasonably possible that gross unrecognized tax benefits may decrease by $30 million to $37 million in the next 12 months. |
Stock Compensation Plans
Stock Compensation Plans | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK COMPENSATION PLANS | 6. STOCK COMPENSATION PLANS As of March 31, 2020 , the Company’s primary type of stock-based compensation was restricted stock units and stock options. Stock-based compensation expense for the following periods were: In millions Three months ended March 31 2020 2019 Restricted stock units $ 19 $ 20 Stock options 4 2 Employee stock purchase plan 2 1 Stock-based compensation expense 25 23 Tax benefit (3 ) (3 ) Stock-based compensation expense (net of tax) $ 22 $ 20 Stock-based compensation expense is recognized in the financial statements based upon grant date fair value. In the three months ended March 31, 2020 , the stock options granted were premium-priced stock options, in which the exercise price is equal to 115% of the closing stock price on the date of the grant, or an exercise price of $38.26 . The weighted average fair value of the option grants was $7.85 based on using a Monte-Carlo simulation model and will be recognized over the requisite service period. These option grants have a seven year contractual term that vest at the end of 36 months. For the three months ended March 31, 2019 , the weighted average fair value of option grants was $8.07 with a seven year contractual term that vest ratably over four years . The table below details the assumptions used in determining the fair value of the option grants. Three months ended March 31 2020 2019 Dividend yield $ — $ — Risk-free interest rate 1.46 % 2.50 % Expected volatility 33.38 % 34.79 % Expected holding period (years) 3.7 3.9 Expected volatility is calculated as the historical volatility of the Company’s stock over a period equal to the expected term of the options, as management believes this is the best representation of prospective trends. The Company uses historical data to estimate option exercise and employee terminations within the valuation model. The expected holding period represents the period of time that options are expected to be outstanding. For options granted during the three months ended March 31, 2020 , the seven-year U.S. Treasury yield curve was used to determine the risk-free interest rate. For options granted during the three months ended March 31, 2019 , the risk-free interest rate was determined based on a blend of the three and five-year U.S. Treasury yield curves in effect at the time of the grant. As of March 31, 2020 , the total unrecognized compensation cost of $118 million related to unvested restricted stock grants is expected to be recognized over a weighted average period of approximately 1.1 years . As of March 31, 2020 , the total unrecognized compensation cost of $63 million related to unvested stock option grants is expected to be recognized over a weighted average period of approximately 1.4 years . Employee Stock Purchase Plan The Company's Employee Stock Purchase Plan ("ESPP") provides employees a 15% discount on stock purchases using a three -month look-back feature where the discount is applied to the stock price that represents the lower of NCR’s closing stock price on either the first day or the last day of each calendar quarter. Participants can contribute between 1% and 10% of their compensation. For the three months ended March 31, 2020 , employees purchased 0.5 million shares, at a discounted price of $15.05 . For the three months ended March 31, 2019 , employees purchased 0.3 million shares, at a discounted price of $20.24 . |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | 7. EMPLOYEE BENEFIT PLANS Components of net periodic benefit cost (income) of the pension plans for the three months ended March 31 were as follows: In millions U.S. Pension Benefits International Pension Benefits Total Pension Benefits 2020 2019 2020 2019 2020 2019 Net service cost $ — $ — $ 1 $ 2 $ 1 $ 2 Interest cost 13 16 4 5 17 21 Expected return on plan assets (9 ) (10 ) (7 ) (8 ) (16 ) (18 ) Net periodic benefit cost (income) $ 4 $ 6 $ (2 ) $ (1 ) $ 2 $ 5 The benefit from the postretirement plan for the following periods were: In millions Three months ended March 31 2020 2019 Interest cost $ — $ — Amortization of: Prior service benefit (1 ) (1 ) Net postretirement benefit $ (1 ) $ (1 ) The net cost of the postemployment plan for the following periods were: Three months ended March 31 In millions 2020 2019 Net service cost $ 6 $ 14 Interest cost — 1 Amortization of: Prior service benefit — (1 ) Actuarial gain (1 ) (1 ) Net benefit cost $ 5 $ 13 Employer Contributions Pension For the three months ended March 31, 2020 , NCR contributed $5 million to its international pension plans. NCR anticipates contributing an additional $16 million to its international pension plans for a total of $21 million in 2020 . Postretirement For the three months ended March 31, 2020 , NCR made no contributions to its U.S. postretirement plan. NCR anticipates contributing an additional $2 million to its U.S. postretirement plan for a total of $2 million in 2020 . Postemployment For the three months ended March 31, 2020 , NCR contributed $4 million to its postemployment plans. NCR anticipates contributing an additional $46 million to its postemployment plans for a total of $50 million in 2020 . |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 8. COMMITMENTS AND CONTINGENCIES In the normal course of business, NCR is subject to various proceedings, lawsuits, claims and other matters, including, for example, those that relate to the environment and health and safety, labor and employment, employee benefits, import/export compliance, intellectual property, data privacy and security, product liability, commercial disputes and regulatory compliance, among others. Additionally, NCR is subject to diverse and complex laws and regulations, including those relating to corporate governance, public disclosure and reporting, environmental safety and the discharge of materials into the environment, product safety, import and export compliance, data privacy and security, antitrust and competition, government contracting, anti-corruption, and labor and human resources, which are rapidly changing and subject to many possible changes in the future. Compliance with these laws and regulations, including changes in accounting standards, taxation requirements, and federal securities laws among others, may create a substantial burden on, and substantially increase costs to NCR or could have an impact on NCR's future operating results. The Company has reflected all liabilities when a loss is considered probable and reasonably estimable in the Condensed Consolidated Financial Statements. We do not believe there is a reasonable possibility that losses exceeding amounts already recognized have been incurred, but there can be no assurances that the amounts required to satisfy alleged liabilities from such matters will not impact future operating results. Other than as stated below, the Company does not currently expect to incur material capital expenditures related to such matters. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various lawsuits, claims, legal proceedings and other matters, including, but not limited to the Fox River and Kalamazoo River environmental matters and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in NCR’s Condensed Consolidated Financial Statements or will not have a material adverse effect on its consolidated results of operations, capital expenditures, competitive position, financial condition or cash flows. Nashville Tornado On March 3, 2020, one of our Global Fulfillment Centers, operated with a third-party logistics partner in Mt. Juliet, Tennessee was severely impacted by tornadoes in the greater Nashville area. We maintain substantial property damage insurance coverage for this Global Fulfillment Center and have, and continue to, work closely with our insurance carrier and claims adjusters to ascertain the property damage. The property on site mainly consisted of raw materials and finished goods inventory, which totaled $151 million , as of the date of the tornado. The Company determined approximately $105 million of the inventory to be a total loss as of March 31, 2020 and as such was written-off with an offsetting insurance receivable recorded, which was included within other current assets in the Condensed Consolidated Balance Sheet with no net impact on cost of sales. The insurance receivable was based on the amount probable of recovery based on the terms of the insurance policy. The remaining $46 million of inventory requires further assessment to determine recoverability. Prior to March 31, 2020, the Company received $25 million as an advance draw from the insurance carrier for the damages sustained. Subsequent to the end of the quarter, we received an additional $40 million from the insurance carrier. Additionally, our insurance policy also provides for business interruption coverage, including lost profits, and reimbursement for other expenses and costs that have been incurred relating to the damages and losses suffered. There have not been material other expenses or costs incurred for the three months ended March 31, 2020 . Boston Consulting Group On November 6, 2019, Boston Consulting Group, Inc., a former consultant for the Company, commenced a lawsuit against the Company in the United States District Court for the District of New York. The Complaint in the matter alleges the Company breached two consulting agreements and seeks in excess of $80 million and other compensatory damages and equitable relief. While the Company at this time is unable to make any predictions about the outcome of this case or estimate any possible liability, the Company believes the allegations of money owed are grossly overstated, and the Company intends to vigorously defend this lawsuit. Environmental Matters NCR's facilities and operations are subject to a wide range of environmental protection laws, and NCR has investigatory and remedial activities underway at a number of facilities that it currently owns or operates, or formerly owned or operated, to comply, or to determine compliance, with such laws. Also, NCR has been identified, either by a government agency or by a private party seeking contribution to site clean-up costs, as a potentially responsible party (PRP) at a number of sites pursuant to various state and federal laws, including the Federal Water Pollution Control Act, the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) and comparable state statutes. Other than the Fox River matter, the Kalamazoo River matter and the Ebina matter discussed below, we currently do not anticipate material expenses and liabilities from these environmental matters. Fox River NCR is one of eight entities that were formally notified by governmental and other entities, such as local Native American tribes, that they are PRPs for environmental claims (under CERCLA and other statutes) arising out of the presence of polychlorinated biphenyls (PCBs) in sediments in the lower Fox River and in the Bay of Green Bay in Wisconsin. The other Fox River PRPs that received notices include Appleton Papers Inc. (API; now known as Appvion, Inc.), P.H. Glatfelter Company ("Glatfelter"), Georgia-Pacific Consumer Products LP (GP, successor to Fort James Operating Company), and others. NCR was identified as a PRP because of alleged PCB discharges from two carbonless copy paper manufacturing facilities it previously owned, which were located along the Fox River. NCR sold its facilities in 1978 to API. The parties have also contended that NCR is responsible for PCB discharges from paper mills owned by other companies because NCR carbonless copy paper "broke" was allegedly purchased by those other mills as a raw material. The United States Environmental Protection Agency (USEPA) and Wisconsin Department of Natural Resources (together, the Governments) developed clean-up plans for the upper and lower parts of the Fox River and for portions of the Bay of Green Bay. On November 13, 2007, the Governments issued a unilateral administrative order (the 2007 Order) under CERCLA to the eight original PRPs, requiring them to perform remedial work under the Governments’ clean-up plan for the lower parts of the river (operable units 2 through 5). In April 2009, NCR and API formed a limited liability company (the LLC), which entered into an agreement with an environmental remediation contractor to perform the work at the Fox River site. In-water dredging and remediation under the clean-up plan commenced shortly thereafter. NCR and API, along with B.A.T Industries p.l.c. (BAT), share among themselves a portion of the cost of the Fox River clean-up and natural resource damages (NRD) based upon a 1998 agreement (the Cost Sharing Agreement), a 2005 arbitration award (subsequently confirmed as a judgment), and a September 30, 2014 Funding Agreement (the Funding Agreement). The Cost Sharing Agreement and the arbitration resolved disputes that arose out of the Company's 1978 sale of its Fox River facilities to API. The Cost Sharing Agreement and arbitration award resulted in a 45% share for NCR of the first $75 million of such costs (a threshold that was reached in 2008), and a 40% share for amounts in excess of $75 million . The Funding Agreement arose out of a 2012 to 2014 arbitration dispute between NCR and API, and provides for regular, ongoing funding of NCR-incurred Fox River remediation costs via contributions, made to a new limited liability corporation created by the Funding Agreement, by BAT, API and, for 2014, API's indemnitor, Windward Prospects. The Funding Agreement creates an obligation on BAT and API to fund 50% of NCR’s Fox River remediation costs from October 1, 2014 forward; (API’s Fox River-related obligations under the Funding Agreement were fully satisfied in 2016); the Funding Agreement also provides NCR contractual avenues for payment of, via direct and third-party sources, (1) the difference between BAT’s and API’s 60% obligation under the Cost Sharing Agreement and arbitration award on the one hand and their ongoing (since September 2014) 50% payments under the Funding Agreement on the other, as well as (2) the difference between the amount NCR received under the Funding Agreement and the amount owed to it under the Cost Sharing Agreement and arbitration award for the period from April 2012 through September 2014. As of March 31, 2020 and December 31, 2019 , the receivable under the Funding Agreement was approximately $53 million , respectively, and was included in other assets in the Condensed Consolidated Balance Sheet. The Company anticipates that it will collect sums related to the receivable in 2020 or later, likely after the remediation efforts related to the Fox River matter, described below, are complete. This receivable is not taken into account in calculating the Company’s Fox River net reserve. The Company's litigations relating to contribution and enforcement claims concerning the Fox River have been concluded. A proposed consent decree settlement (the CD settlement) with respect to the contribution action (a case originally filed by NCR and API) and the government enforcement action (a case originally filed by the federal and state governments against several PRPs, including the Company) was successfully negotiated by NCR and the federal and state governments and was approved on August 22, 2017 by the federal district court in Wisconsin that had been presiding over those cases. A final order of dismissal as to the Company in the contribution and government enforcement actions was subsequently entered; one party, Glatfelter, had appealed the approval of the CD settlement. On January 3, 2019, the United States lodged a proposed consent decree with the Wisconsin court, reflecting a settlement reached by the United States, Wisconsin and Glatfelter with respect to Glatfelter’s Fox River liability under the government enforcement action; a component of that settlement was withdrawal of Glatfelter’s appeal opposing the Company’s CD settlement. On March 14, 2019, the Wisconsin court approved the Glatfelter consent decree, and on April 3, 2019, Glatfelter's appeal was dismissed. The CD settlement has now resolved the remaining Fox River-related contribution and enforcement claims against the Company. The key components of the approved CD settlement include (1) the Company’s commitment to complete the remediation of the Fox River, which is now expected to be completed in 2020; (2) the Company’s conditional agreement to waive its contribution claims against the two remaining defendants in the case, GP and Glatfelter; (3) the Company’s agreement not to appeal the trial court’s decision on divisibility of harm; (4) the Governments’ agreement to include in the settlement so-called “contribution protection” in the Company’s favor as to GP’s and Glatfelter’s contribution claims against the Company, the effect of which will be to extinguish those claims; (5) the Governments’ agreement not to pursue the Company for the Governments’ past oversight costs; and (6) the Governments’ agreement to exercise prosecutorial discretion in pursuing other parties for future oversight costs and long-term monitoring and maintenance, with the Company retaining so-called “backstop” liability in the event that the other parties fail to pay future oversight costs or to perform long-term monitoring and maintenance. Additionally, although certain state law claims by GP and Glatfelter against the Company may not be affected directly by the CD settlement, the CD settlement provides that the Company’s contribution claims against those two parties will revive if those parties attempt to assert any claims against the Company relating to the Fox River, including any state law claims. In the quarter ending September 30, 2017, the remediation general contractor commenced an arbitration against the LLC, in a dispute over contract interpretation. The hearing on this matter was completed in June 2019, and the parties submitted post-trial briefs in August 2019. The amounts claimed by the contractor range from approximately $46 million to approximately $53 million ; the Company disputed the claims and contested them vigorously during the hearing. In November 2019, having rejected substantial portions of the claims, the arbitration panel awarded the contractor $10 million . The Company’s indemnitors and co-obligors, described below, are expected to bear responsibility for the majority of any award, with the Company’s share of approximately one-fourth of such award. With respect to the Company’s prior dispute with API, which was generally superseded by the Funding Agreement, the Company received timely payments as they came due under the Funding Agreement. Although API filed for bankruptcy protection in October 2017, it had made all of the payments to the Company in connection with the Fox River that are required of it by the Funding Agreement. NCR's eventual remediation liability, followed by long-term monitoring expected to be performed by others, will depend on a number of factors. In establishing the reserve, NCR attempts to estimate a range of reasonably possible outcomes for each of these factors, although each range is itself uncertain. NCR uses its best estimate within the range, if that is possible. Where there is a range of equally possible outcomes, and there is no amount within that range that is considered to be a better estimate than any other amount, NCR uses the low end of the range. The significant factors include: (1) the total remaining clean-up costs, including the costs associated with decommissioning the site, the expected cost impact of which is expected to be neutral or non-material to the Company, including long-term monitoring following completion of the clean-up, and what parties are assigned to discharge the post-clean-up tasks (as noted, the Company no longer expects to bear long-term monitoring costs); (2) total NRD for the site and the share that NCR will bear (which is now resolved as to the Company); (3) the share of clean-up costs that NCR will bear (which is resolved under the CD settlement); (4) NCR's transaction and litigation costs to defend itself to the extent additional litigation is required with respect to claims brought by the general contractor; and (5) the share of NCR's payments that BAT will bear (which is governed by the Cost Sharing Agreement and the Funding Agreement, BAT has made all of the payments requested of it, and as discussed above; API is in bankruptcy and is not presumed likely to bear further shares of NCR’s payments). With respect to NRD, in connection with a certain settlement entered into by other PRPs in 2015, the Government withdrew the NRD claims it had prosecuted on behalf of NRD trustees, including those NRD claims asserted against the Company. Calculation of the Company's Fox River reserve is subject to several complexities, and it is possible there could be additional changes to some elements of the reserve over upcoming periods, although the Company is unable to predict or estimate such changes at this time. There can be no assurance that the clean-up and related expenditures and liabilities will not have a material effect on NCR's capital expenditures, earnings, financial condition, cash flows, or competitive position. As of March 31, 2020 , the gross reserve for the Fox River matter was approximately $3 million , compared to $5 million as of December 31, 2019 . As of March 31, 2020 , the net reserve for the Fox River matter was approximately $21 million , compared to $16 million as of December 31, 2019 . NCR contributes to the LLC to fund remediation activities and generally, by contract, has funded certain amounts of remediation expenses in advance. As of March 31, 2020 and December 31, 2019 , approximately zero remained from this funding. NCR's reserve for the Fox River matter is reduced as the LLC makes payments to the remediation contractor and other vendors with respect to remediation activities. Under a 1996 agreement, AT&T Corp. (AT&T) and Nokia (as the successor to Lucent Technologies and Alcatel-Lucent USA) are responsible severally (not jointly) for indemnifying NCR for certain portions of the amounts paid by NCR for the Fox River matter over a defined threshold and subject to certain offsets. (The agreement governs certain aspects of AT&T's divestiture of NCR and of what was then known as Lucent Technologies.) Those companies have made the payments requested of them by the Company on an ongoing basis. Kalamazoo River In November 2010, USEPA issued a "general notice letter" to NCR with respect to the Allied Paper, Inc./Portage Creek/Kalamazoo River Superfund Site (Kalamazoo River site) in Michigan. Three other companies - International Paper, Mead Corporation, and Consumers Energy - also received general notice letters at or about the same time. USEPA asserts that the site is contaminated by various substances, primarily PCBs, as a result of discharges by various paper mills located along the river. USEPA does not claim that the Company made direct discharges into the Kalamazoo River, and NCR never had facilities at or near the Kalamazoo River site, but USEPA indicated that "NCR may be liable under Section 107 of CERCLA ... as an arranger, who by contract or agreement, arranged for the disposal, treatment and/or transportation of hazardous substances at the Site." USEPA stated that it "may issue special notice letters to [NCR] and other PRPs for future RI/FS [remedial investigation / feasibility studies] and RD/RA [remedial design / remedial action] negotiations." In connection with the Kalamazoo River site, in December 2010 the Company, along with two other defendants, was sued in federal court by three Georgia-Pacific (GP) affiliate corporations in a private-party contribution and cost recovery action for alleged pollution. The suit, pending in Michigan, asks that the Company and other defendants pay a "fair portion" of these companies’ costs. Various removal and remedial actions remain to be decided upon and performed at the Kalamazoo River site, the total costs for which generally remain undetermined; in 2017 Records of Decisions were issued for two parts of the river, and in 2018 such a decision was issued for another part of the river, but such decisions for the majority of the work are expected to be made only over the next several years. The suit alleges that the Company is liable to the GP entities as an "arranger" under CERCLA. The initial phase of the case was tried in a Michigan federal court in February 2013; on September 26, 2013 the court issued a decision that held NCR was liable as an “arranger” as of at least March 1969. (PCB-containing carbonless copy paper was produced from approximately 1954 to April 1971, and the majority of contamination at the Kalamazoo River site had occurred prior to 1969). NCR preserved its right to appeal the September 2013 decision. In the 2013 decision, the Court did not determine NCR’s share of the overall liability. Relative shares of liability for the four companies were tried to the court in a subsequent phase of the case in December 2015. In a ruling issued on March 29, 2018, the court addressed responsibility for the costs that GP had incurred in the past, totaling to approximately $50 million (GP had sought approximately $105 million , but $55 million of those claims were removed by the court upon motions filed by the Company and other parties); NCR and GP were each assigned a 40% share of those costs, and the other two companies were assigned 15% and 5% as their allocations. The court entered a judgment in the case on June 19, 2018, in which it indicated that it would not allocate future costs, but would enter a declaratory judgment that the four companies together had responsibility for future costs, in amounts and shares to be determined. Cross-proceedings have been commenced to obtain recoveries from the other parties pursuant to the judgment; those proceedings are stayed pending the appeal referenced below. In July 2018, the Company appealed to the United States Court of Appeals for the Sixth Circuit both the 2013 court decision, which it believes is in conflict with a decision from the Fox River trial court as to Operable Unit 1 of that site and an affirmance of that decision from the Court of Appeals for the Seventh Circuit, and the 2018 court decision, on various legal grounds. The Company filed a bond to stay any execution of the judgment pending the appeal, and its application for a stay was approved by the court and remains stayed as of March 2020. During the pendency of the Sixth Circuit stay, the Company negotiated a settlement of the Kalamazoo River matter with the USEPA and other government agencies having oversight over the river. On December 5, 2019, the Company entered into a Consent Decree, filed with the District Court on December 11, 2019, which will resolve all litigation associated with the river clean-up, including the Sixth Circuit appeal when approved. Upon approval, the Consent Decree will require the Company to pay GP its 40% share of past costs, to pay the USEPA and state agencies their past and future administrative costs, to dismiss its Sixth Circuit appeal, and to take responsibility for the remediation of a portion, but not all, of the Kalamazoo River. The Consent Decree further provides the Company protection from other PRPs, including GP, seeking contribution for their costs associated with the clean-up anywhere on the river, thereby resolving the allocation of future costs left unresolved by the June 19, 2019 judgment. The Consent Decree was subject to a public comment period which ended February 18, 2020, and the Company is still awaiting approval of the Consent Decree. NCR expects to have claims against BAT and API under the Funding Agreement, discussed above for the Kalamazoo River remediation expenses. API filed for bankruptcy protection in October 2017, and thus payment of its potential share under the Funding Agreement for so-called “future sites,” which would include the Kalamazoo River site, may be at risk, but as liability under the Cost Sharing Agreement and the Funding Agreement is joint and several, the bankruptcy is not anticipated to affect the Company’s ability to seek that amount from BAT. The Company will also have indemnity or reimbursement claims against AT&T and Nokia under the arrangement discussed above in connection with the Fox River matter after expenses have met a contractual threshold set out in the 1996 agreement referenced above in the Fox River discussion. As of March 31, 2020 and December 31, 2019 , the total reserve for Kalamazoo was $81 million ; that figure is reported on a basis that is net of expected contributions from the Company's co-obligors and indemnitors, subject to when the applicable threshold is reached. As many aspects of the costs of remediation will not be determined for several years (and thus the high end of a range of possible costs for many areas of the site cannot be quantified at this time), the Company has made what it considers to be reasonable estimates of the low end of a range for such costs where remedies are identified, and/or of the costs of investigations and studies for areas of the river where remedies have not yet been determined, and the reserve is informed by those estimates. The extent of NCR’s potential liability remains subject to many uncertainties, notwithstanding the settlement of this matter and related Consent Decree noted above, particularly inasmuch as remedy decisions and cost estimates will not be generated until times in the future and as most of the work to be performed will take place through the 2030s. Under other assumptions or estimates for possible costs of remediation, which the Company does not at this point consider to be reasonably estimable or verifiable, it is possible that the reserve the Company has taken to discontinued operations reflected in this paragraph could more than approximately double the reflected reserve. Ebina The Company is engaged in cooperative regulatory compliance activities with the government of Japan in connection with certain environmental contaminants generated in its past operations in that country. The Company has quantities of PCB and other wastes primarily from its former plant at Oiso, Japan, including capsulated undiluted solutions manufactured in the past, capacitors, light ballasts and PCB-affected soil from the Oiso plant that was excavated and placed in steel drums. These wastes are stored in a facility at Ebina, Japan in accordance with Japanese regulations governing such materials. Over the past several years Japan has enacted and amended legislation governing such wastes, and has set a current deadline for treating and disposing of (at government-constructed disposal facilities) the highest-concentration wastes by 2027. Lower-concentration wastes can be and have been disposed of via private contractors, and as of the period ended March 31, 2020 , NCR had disposed of more than a third of its lower-concentration wastes. The Company and its consultants have met and communicated regularly with the Japanese agency charged with administration of the law, and are working with that agency on a program to manage disposal of the high-concentration wastes, including tests of technologies to make the disposal more efficient. Based on communications with the agency, the earliest that high-concentration wastes can be disposed of will be in the second half of 2020, with final deadlines for various of the government-constructed disposal sites currently set for 2022, 2023 and later. Low-concentration wastes are required to be contracted for disposal by 2027, a timetable that the Company expects to meet. In September 2019, the Company’s environmental consultants, following a series of communications and meetings with the Japanese agency, at the Company’s request prepared an estimate of remaining disposal costs over the coming several years. While the estimate is subject to a range of assumptions and uncertainties, including prospects of cost reduction in coordination with the agency as certain field testing to separate high-concentration and low-concentration waste progresses over the coming years, the Company has adjusted its existing reserve for the matter to take into account this cost estimate, and that reserve as of March 31, 2020 is $20 million compared to $19 million at December 31, 2019 . The Japan environmental waste issue is treated as a compliance matter and not as litigation or enforcement, and the Company has received no threats of litigation or enforcement. Environmental-Related Insurance Recoveries In connection with the Fox River and other environmental sites, through March 31, 2020 , NCR has received a combined gross total of approximately $202 million in settlements reached with various of its insurance carriers. Portions of many of these settlements agreed in the 2010 through 2013 timeframe are payable to a law firm that litigated the claims on the Company's behalf. Some of the settlements cover not only the Fox River but also other environmental sites; some are limited to either the Fox River or the Kalamazoo River site. Some of the settlements are directed to defense costs and some are directed to indemnity; some settlements cover both defense costs and indemnity. The Company does not anticipate that further material insurance recoveries specific to Kalamazoo River remediation costs will be available to it, owing to considerations under applicable Michigan law. Claims with respect to Kalamazoo River defense costs have now been settled, with the amounts of those settlements included in the sum reported above. Environmental Remediation Estimates It is difficult to estimate the future financial impact of environmental laws, including potential liabilities. NCR records environmental provisions when it is probable that a liability has been incurred and the amount or range of the liability is reasonably estimable in accordance with accounting guidance, where liabilities are not expected to be quantifiable or estimable for a period of years, the estimated costs of investigating those liabilities are recorded as a component of the reserve for that particular site. Provisions for estimated losses from environmental restoration and remediation are, depending on the site, based generally on internal and third-party environmental studies, estimates as to the number and participation level of other PRPs, the extent of contamination, estimated amounts for attorney and other fees, and the nature of required clean-up and restoration actions. Reserves are adjusted as further information develops or circumstances change. Management expects that the amounts reserved from time to time will be paid out over the period of investigation, negotiation, remediation and restoration for the applicable sites. The amounts provided for environmental matters in NCR's Condensed Consolidated Financial Statements are the estimated gross undiscounted amounts of such liabilities, without deductions for indemnity insurance, third-party indemnity claims or recoveries from other PRPs, except as qualified in the following sentences. In those cases where insurance carriers or third-party indemnitors have agreed to pay any amounts and management believes that collectability of such amounts is probable, the amounts are recorded in the Condensed Consolidated Financial Statements. For the Fox River and Kalamazoo River sites, as described above, assets relating to the AT&T and Nokia indemnities and to the BAT obligations are recorded as payment is supported by contractual agreements, public filings and/or payment history. Guarantees and Product Warranties In the ordinary course of business, NCR may issue performance guarantees on behalf of its subsidiaries to certain of its customers and other parties. Some of those guarantees may be backed by standby letters of credit, surety bonds, or similar instruments. In general, under the guarantees, NCR would be obligated to perform, or cause performance, over the term of the underlying contract in the event of an unexcused, uncured breach by its subsidiary, or some other specified triggering event, in each case as defined by the applicable guarantee. NCR believes the likelihood of having to perform under any such guarantee is remote. As of March 31, 2020 and December 31, 2019 , NCR had no material obligations related to such guarantees, and therefore its Condensed Consolidated Financial Statements do not have any associated liability balance. NCR provides its customers a standard manufacturer’s warranty and records, at the time of the sale, a corresponding estimated liability for potential warranty costs. Estimated future obligations due to warranty claims are based upon historical factors, such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. When a sale is consummated, the total customer revenue is recognized, provided that all revenue recognition criteria are otherwise satisfied, and the associated warranty liability is recorded using pre-established warranty percentages for the respective product classes. From time to time, product design or quality corrections are accomplished through modification programs. When identified, associated costs of labor and parts for such programs are estimated and accrued as part of the warranty reserve. The Company recorded the activity related to the warranty reserve for the three months ended March 31 as follows: In millions 2020 2019 Warranty reserve liability Beginning balance as of January 1 $ 21 $ 26 Accruals for warranties issued 8 8 Settlements (in cash or in kind) (11 ) |
Leasing
Leasing | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
LEASING | 9. LEASING Lessee We lease property, vehicles and equipment under operating and financing leases. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. We determine the lease term by assuming the exercise of renewal options that are reasonably certain. Leases with a lease term 12 months or less at inception are not recorded on our Condensed Consolidated Balance Sheet and are expensed on a straight-line basis over the lease term in our Condensed Consolidated Statement of Operations. Our leases may include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when appropriate. When available, we use the rate implicit in the lease to discount lease payments to present value; however, most of our leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. Our incremental borrowing rate is based on a credit-adjusted risk-free rate at commencement date, which best approximates a secured rate over a similar term of lease. Additionally, we do not separate lease and non-lease components for any asset classes, except for those leases embedded in certain service arrangements. Fixed and in-substance fixed payments are included in the recognition of the operating and financing assets and lease liabilities, however, variable lease payments, other than those based on a rate or index, are recognized in the Condensed Consolidated Statements of Operations in the period in which the obligation for those payments is incurred. The Company’s variable lease payments generally relate to payments tied to various indices, non-lease components and payments above a contractual minimum fixed payment. The following table presents our lease balances as of March 31, 2020 and December 31, 2019 : In millions Location in the Condensed Consolidated Balance Sheet March 31, 2020 December 31, 2019 Assets Operating lease assets Operating lease assets $ 362 $ 391 Finance lease assets Property, plant and equipment, net 47 38 Accumulated Amortization of Finance lease assets Property, plant and equipment, net (8 ) (5 ) Total leased assets $ 401 $ 424 Liabilities Current Operating lease liabilities Other current liabilities $ 88 $ 91 Finance lease liabilities Other current liabilities 13 10 Noncurrent Operating lease liabilities Operating lease liabilities 346 369 Finance lease liabilities Other liabilities 28 25 Total lease liabilities $ 475 $ 495 The following table presents our lease costs for operating and finance leases: In millions Three months ended March 31 2020 2019 Operating lease cost $ 32 $ 35 Finance lease cost Amortization of leased assets 3 — Interest on lease liabilities — — Short-Term lease cost 1 2 Variable lease cost 7 9 Total lease cost $ 43 $ 46 The following table presents the supplemental cash flow information: In millions Three months ended March 31 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 30 $ 32 Operating cash flows from finance leases $ — $ — Financing cash flows from finance leases $ 3 $ — Lease Assets Obtained in Exchange for Lease Obligations Operating Leases $ (2 ) $ 12 Finance Leases $ 8 $ 1 The following table reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities recorded on the Condensed Consolidated Balance Sheet as of March 31, 2020 : In millions Operating Leases Finance Leases Remainder of 2020 $ 88 $ 10 2021 86 14 2022 64 13 2023 44 6 2024 38 — Thereafter 272 — Total lease payments 592 43 Less: Amount representing interest (158 ) (2 ) Present value of lease liabilities $ 434 $ 41 As of March 31, 2020 , we have additional operating leases of $73 million , primarily for a real estate lease in Europe, that have not yet commenced. This operating lease is expected to commence in 2021 with a lease term of 10 years. The following table presents the weighted average remaining lease term and interest rates: March 31, 2020 December 31, 2019 Weighted average lease term: Operating leases 9.1 years 8.9 years Finance leases 3.2 years 3.4 years Weighted average interest rates: Operating leases 6.39 % 6.42 % Finance leases 4.15 % 3.72 % Lessor We have various arrangements for certain point-of-sale equipment under which we are the lessor. These leases meet the criteria for operating lease classification. Lease income associated with these leases is not material. |
LEASING | 9. LEASING Lessee We lease property, vehicles and equipment under operating and financing leases. For leases with terms greater than 12 months, we record the related asset and obligation at the present value of lease payments over the term. We determine the lease term by assuming the exercise of renewal options that are reasonably certain. Leases with a lease term 12 months or less at inception are not recorded on our Condensed Consolidated Balance Sheet and are expensed on a straight-line basis over the lease term in our Condensed Consolidated Statement of Operations. Our leases may include rental escalation clauses, renewal options and/or termination options that are factored into our determination of lease payments when appropriate. When available, we use the rate implicit in the lease to discount lease payments to present value; however, most of our leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. Our incremental borrowing rate is based on a credit-adjusted risk-free rate at commencement date, which best approximates a secured rate over a similar term of lease. Additionally, we do not separate lease and non-lease components for any asset classes, except for those leases embedded in certain service arrangements. Fixed and in-substance fixed payments are included in the recognition of the operating and financing assets and lease liabilities, however, variable lease payments, other than those based on a rate or index, are recognized in the Condensed Consolidated Statements of Operations in the period in which the obligation for those payments is incurred. The Company’s variable lease payments generally relate to payments tied to various indices, non-lease components and payments above a contractual minimum fixed payment. The following table presents our lease balances as of March 31, 2020 and December 31, 2019 : In millions Location in the Condensed Consolidated Balance Sheet March 31, 2020 December 31, 2019 Assets Operating lease assets Operating lease assets $ 362 $ 391 Finance lease assets Property, plant and equipment, net 47 38 Accumulated Amortization of Finance lease assets Property, plant and equipment, net (8 ) (5 ) Total leased assets $ 401 $ 424 Liabilities Current Operating lease liabilities Other current liabilities $ 88 $ 91 Finance lease liabilities Other current liabilities 13 10 Noncurrent Operating lease liabilities Operating lease liabilities 346 369 Finance lease liabilities Other liabilities 28 25 Total lease liabilities $ 475 $ 495 The following table presents our lease costs for operating and finance leases: In millions Three months ended March 31 2020 2019 Operating lease cost $ 32 $ 35 Finance lease cost Amortization of leased assets 3 — Interest on lease liabilities — — Short-Term lease cost 1 2 Variable lease cost 7 9 Total lease cost $ 43 $ 46 The following table presents the supplemental cash flow information: In millions Three months ended March 31 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 30 $ 32 Operating cash flows from finance leases $ — $ — Financing cash flows from finance leases $ 3 $ — Lease Assets Obtained in Exchange for Lease Obligations Operating Leases $ (2 ) $ 12 Finance Leases $ 8 $ 1 The following table reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities recorded on the Condensed Consolidated Balance Sheet as of March 31, 2020 : In millions Operating Leases Finance Leases Remainder of 2020 $ 88 $ 10 2021 86 14 2022 64 13 2023 44 6 2024 38 — Thereafter 272 — Total lease payments 592 43 Less: Amount representing interest (158 ) (2 ) Present value of lease liabilities $ 434 $ 41 As of March 31, 2020 , we have additional operating leases of $73 million , primarily for a real estate lease in Europe, that have not yet commenced. This operating lease is expected to commence in 2021 with a lease term of 10 years. The following table presents the weighted average remaining lease term and interest rates: March 31, 2020 December 31, 2019 Weighted average lease term: Operating leases 9.1 years 8.9 years Finance leases 3.2 years 3.4 years Weighted average interest rates: Operating leases 6.39 % 6.42 % Finance leases 4.15 % 3.72 % Lessor We have various arrangements for certain point-of-sale equipment under which we are the lessor. These leases meet the criteria for operating lease classification. Lease income associated with these leases is not material. |
Series A Convertible Preferred
Series A Convertible Preferred Stock | 3 Months Ended |
Mar. 31, 2020 | |
Series A Preferred Stock [Abstract] | |
SERIES A CONVERTIBLE PREFERRED STOCK | 10. SERIES A CONVERTIBLE PREFERRED STOCK On December 4, 2015, NCR issued 820,000 shares of Series A Convertible Preferred Stock to certain entities affiliated with the Blackstone Group L.P. (collectively, Blackstone) for an aggregate purchase price of $820 million , or $1,000 per share, pursuant to an Investment Agreement between the Company and Blackstone, dated November 11, 2015. In connection with the issuance of the Series A Convertible Preferred Stock, the Company incurred direct and incremental expenses of $26 million , including financial advisory fees, closing costs, legal expenses and other offering-related expenses. These direct and incremental expenses originally reduced the Series A Convertible Preferred Stock, and will be accreted through retained earnings as a deemed dividend from the date of issuance through the first possible known redemption date, March 16, 2024. Holders of Series A Convertible Preferred Stock are entitled to a cumulative dividend at the rate of 5.5% per annum, payable quarterly in arrears. The Series A Convertible Preferred Stock is convertible at the option of the holders at any time into shares of common stock at a conversion price of $30.00 per share, or a conversion rate of 33.333 shares of common stock per share of Series A Convertible Preferred Stock. Under the Investment Agreement, Blackstone agreed not to sell or otherwise transfer its shares of Series A Convertible Preferred Stock (or any shares of common stock issued upon conversion thereof) without the Company’s consent until June 4, 2017. In March 2017, we provided Blackstone with an early release from this lock-up, allowing Blackstone to sell approximately 49% of its shares of Series A Convertible Preferred Stock, and in return, Blackstone agreed to amend the Investment Agreement to extend the lock-up on the remaining 51% of its shares of Series A Convertible Preferred Stock for six months until December 1, 2017. In connection with the early release of the lock-up, Blackstone offered for sale 342,000 shares of Series A Convertible Preferred Stock in an underwritten public offering. In addition, Blackstone converted 90,000 shares of Series A Convertible Preferred Stock into shares of our common stock and we repurchased those shares of common stock for $48.47 per share. The underwritten offering and the stock repurchase were consummated on March 17, 2017. On September 18, 2019, NCR entered into an agreement to repurchase and convert the outstanding 512,221 shares of Series A Convertible Preferred Stock owned by Blackstone. NCR repurchased 237,673 shares of Series A Convertible Preferred Stock for total cash consideration of $302 million . The remaining shares of Blackstone's Series A Convertible Preferred Stock, including accrued dividends, were converted to approximately 9.16 million shares of common stock at a conversion price of $30.00 per share. Beginning in the first quarter of 2020, dividends are payable in cash or in-kind at the option of the Company. During the three months ended March 31, 2020 , the Company paid cash dividends of $6 million . During the three months ended March 31, 2019 , the Company paid dividends-in-kind of $12 million . As of March 31, 2020 and December 31, 2019 , the maximum number of common shares that could be required to be issued upon conversion of the outstanding shares of Series A Convertible Preferred Stock was 13.2 million and 13.3 million |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | 11. EARNINGS PER SHARE Basic earnings per share (EPS) is calculated by dividing net income or loss attributable to NCR, less any dividends (declared or cumulative undeclared), deemed dividends, accretion or decretion, redemption or induced conversion on our Series A Convertible Preferred Stock, by the weighted average number of shares outstanding during the period. In computing diluted EPS, we adjust the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared), deemed dividends, accretion or decretion, redemption or induced conversion on our Series A Convertible Preferred Stock. We adjust the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares related to the Series A Convertible Preferred Stock and stock-based compensation plans. The holders of Series A Convertible Preferred Stock, unvested restricted stock units and stock options do not have nonforfeitable rights to common stock dividends or common stock dividend equivalents. Accordingly, the Series A Convertible Preferred Stock, unvested restricted stock units and stock options do not qualify as participating securities. See Note 6, Stock Compensation Plans for share information on NCR’s stock compensation plans. The components of basic earnings per share are as follows: In millions, except per share amounts Three months ended March 31 2020 2019 Numerator: Income from continuing operations $ 23 $ 37 Dividends on Series A Convertible Preferred Stock (6 ) (13 ) Income from continuing operations attributable to NCR common stockholders 17 24 Loss from discontinued operations, net of tax — — Net income attributable to NCR common stockholders $ 17 $ 24 Denominator: Basic weighted average number of shares outstanding 128.0 119.3 Basic earnings per share: From continuing operations $ 0.13 $ 0.20 From discontinued operations — — Total basic earnings per share $ 0.13 $ 0.20 The components of diluted earnings per share are as follows: In millions, except per share amounts Three months ended March 31 2020 2019 Numerator: Income from continuing operations $ 23 $ 37 Dividends on Series A Convertible Preferred Stock (6 ) (13 ) Income from continuing operations attributable to NCR common stockholders 17 24 Loss from discontinued operations, net of tax — — Net income attributable to NCR common stockholders $ 17 $ 24 Denominator: Basic weighted average number of shares outstanding 128.0 119.3 Dilutive effect of restricted stock units and stock options 2.5 2.9 Weighted average diluted shares 130.5 122.2 Diluted earnings per share: From continuing operations $ 0.13 $ 0.20 From discontinued operations — — Total diluted earnings per share $ 0.13 $ 0.20 For the three months ended March 31, 2020 , shares related to the as-if converted Series A Convertible Preferred Stock of 13.2 million were excluded from the diluted share count because their effect would have been anti-dilutive. For the three months ended March 31, 2020 , weighted average restricted stock units and stock options of 7.8 million were excluded from the diluted share count because their effect would have been anti-dilutive. For the three months ended March 31, 2019 , shares related to the as-if converted Series A Convertible Preferred Stock of 29.2 million were excluded from the diluted share count because their effect would have been anti-dilutive. For the three months ended March 31, 2019 , weighted average restricted stock units and stock options of 4.5 million were excluded from the diluted share count because their effect would have been anti-dilutive. |
Derivatives and Hedging Instrum
Derivatives and Hedging Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES AND HEDGING INSTRUMENTS | 12. DERIVATIVES AND HEDGING INSTRUMENTS NCR is exposed to risks associated with changes in foreign currency exchange rates and interest rates. NCR utilizes a variety of measures to monitor and manage these risks, including the use of derivative financial instruments. NCR has exposure to approximately 50 functional currencies. Since a substantial portion of our operations and revenue occur outside the U.S., and in currencies other than the U.S. Dollar, our results can be significantly impacted, both positively and negatively, by changes in foreign currency exchange rates. Foreign Currency Exchange Risk The accounting guidance for derivatives and hedging requires companies to recognize all derivative instruments as either assets or liabilities at fair value in the Condensed Consolidated Balance Sheets. The Company designates foreign exchange contracts as cash flow hedges of forecasted transactions when they are determined to be highly effective at inception. Our risk management strategy includes hedging, on behalf of certain subsidiaries, a portion of our forecasted, non-functional currency denominated cash flows for a period of up to 15 months . As a result, some of the impact of currency fluctuations on non-functional currency denominated transactions (and hence on subsidiary operating income, as stated in the functional currency), is mitigated in the near term. The amount we hedge and the duration of hedge contracts may vary significantly. In the longer term (greater than 15 months ), the subsidiaries are still subject to the effect of translating the functional currency results to U.S. Dollars. To manage our exposures and mitigate the impact of currency fluctuations on the operations of our foreign subsidiaries, we hedge our main transactional exposures through the use of foreign exchange forward and option contracts. This is primarily done through the hedging of foreign currency denominated inter-company inventory purchases by NCR’s marketing units and the foreign currency denominated inputs to our manufacturing units. The related foreign exchange contracts are designated as highly effective cash flow hedges. The gains or losses on these hedges are deferred in accumulated other comprehensive income (AOCI) and reclassified to income when the underlying hedged transaction is recorded in earnings. As of March 31, 2020 , the balance in AOCI related to foreign exchange derivative transactions was a gain of $2 million , net of tax. The gains or losses from derivative contracts related to inventory purchases are recorded in cost of products when the inventory is sold to an unrelated third party. We also utilize foreign exchange contracts to hedge our exposure of assets and liabilities denominated in non-functional currencies. We recognize the gains and losses on these types of hedges in earnings as exchange rates change. We do not enter into hedges for speculative purposes. The following tables provide information on the location and amounts of derivative fair values in the Condensed Consolidated Balance Sheets: Fair Values of Derivative Instruments March 31, 2020 In millions Balance Sheet Location Notional Amount Fair Value Balance Sheet Location Notional Amount Fair Value Derivatives designated as hedging instruments Foreign exchange contracts Other current assets $ 155 $ 5 Other current liabilities $ 79 $ 2 Total derivatives designated as hedging instruments $ 5 $ 2 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets $ 175 $ 1 Other current liabilities $ 319 $ 4 Total derivatives not designated as hedging instruments $ 1 $ 4 Total derivatives $ 6 $ 6 Fair Values of Derivative Instruments December 31, 2019 In millions Balance Sheet Location Notional Amount Fair Value Balance Sheet Location Notional Amount Fair Value Derivatives designated as hedging instruments Foreign exchange contracts Other current assets $ 55 $ 1 Other current liabilities $ — $ — Total derivatives designated as hedging instruments $ 1 $ — Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets $ 71 $ 1 Other current liabilities $ 264 $ 1 Total derivatives not designated as hedging instruments $ 1 $ 1 Total derivatives $ 2 $ 1 The effects of derivative instruments on the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2020 and 2019 were as follows: In millions Amount of Gain (Loss) Recognized in Other Comprehensive Income (OCI) on Derivative Amount of (Gain) Loss Reclassified from AOCI into the Condensed Consolidated Statement of Operations Derivatives in Cash Flow Hedging Relationships For the three months ended March 31, 2020 For the three months ended March 31, 2019 Location of (Gain) Loss Reclassified from AOCI into the Condensed Consolidated Statement of Operations For the three months ended March 31, 2020 For the three months ended March 31, 2019 Foreign exchange contracts $ 3 $ 1 Cost of products $ (1 ) $ (1 ) In millions Amount of Gain (Loss) Recognized in the Condensed Consolidated Statement of Operations Three months ended March 31 Derivatives not Designated as Hedging Instruments Location of Gain (Loss) Recognized in the Condensed Consolidated Statement of Operations 2020 2019 Foreign exchange contracts Other (expense), net $ 6 $ (5 ) Refer to Note 13. Fair Value of Assets and Liabilities, for further information on derivative assets and liabilities recorded at fair value on a recurring basis. Concentration of Credit Risk NCR is potentially subject to concentrations of credit risk on accounts receivable and financial instruments such as hedging instruments and cash and cash equivalents. Credit risk includes the risk of nonperformance by counterparties. The maximum potential loss may exceed the amount recognized on the Condensed Consolidated Balance Sheets. Exposure to credit risk is managed through credit approvals, credit limits, selecting major international financial institutions (as counterparties to hedging transactions) and monitoring procedures. NCR’s business often involves large transactions with customers, and if one or more of those customers were to default on its obligations under applicable contractual arrangements, the Company could be exposed to potentially significant losses. However, management believes that the reserves for expected losses are adequate. As of March 31, 2020 , we did no t have any significant concentration of credit risk related to financial instruments. |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF ASSETS AND LIABILITIES | 13. FAIR VALUE OF ASSETS AND LIABILITIES Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities recorded at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 are set forth as follows: March 31, 2020 In millions Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Deposits held in money market mutual funds (1) $ 937 $ 937 $ — $ — Foreign exchange contracts (2) 6 — 6 — Total $ 943 $ 937 $ 6 $ — Liabilities: Foreign exchange contracts (3) $ 6 $ — $ 6 $ — Total $ 6 $ — $ 6 $ — December 31, 2019 In millions Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Deposits held in money market mutual funds (1) $ 15 $ 15 $ — $ — Foreign exchange contracts (2) 2 — 2 — Total $ 17 $ 15 $ 2 $ — Liabilities: Foreign exchange contracts (3) $ 1 $ — $ 1 $ — Total $ 1 $ — $ 1 $ — (1) Included in Cash and cash equivalents in the Condensed Consolidated Balance Sheets. (2) Included in Other current assets in the Condensed Consolidated Balance Sheets. (3) Included in Other current liabilities in the Condensed Consolidated Balance Sheets. Deposits Held in Money Market Mutual Funds A portion of the Company’s excess cash is held in money market mutual funds that generate interest income based on prevailing market rates. Money market mutual fund holdings are measured at fair value using quoted market prices and are classified within Level 1 of the valuation hierarchy. Foreign Exchange Contracts As a result of our global operating activities, we are exposed to risks from changes in foreign currency exchange rates, which may adversely affect our financial condition. To manage our exposures and mitigate the impact of currency fluctuations on our financial results, we hedge our primary transactional exposures through the use of foreign exchange forward and option contracts. The foreign exchange contracts are valued using the market approach based on observable market transactions of forward rates and are classified within Level 2 of the valuation hierarchy. Assets Measured at Fair Value on a Non-recurring Basis From time to time, certain assets are measured at fair value on a nonrecurring basis using significant unobservable inputs (Level 3). NCR reviews the carrying values of investments when events and circumstances warrant and considers all available evidence in evaluating when declines in fair value are other-than-temporary declines. There were no material impairment charges or non-recurring fair value adjustments recorded during the three months ended March 31, 2020 and 2019 . |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) (AOCI) | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (AOCI) | 14. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (AOCI) Changes in AOCI by Component In millions Currency Translation Adjustments Changes in Employee Benefit Plans Changes in Fair Value of Effective Cash Flow Hedges Total Balance as of December 31, 2019 $ (260 ) $ (10 ) $ 1 $ (269 ) Other comprehensive income (loss) before reclassifications (60 ) — 2 (58 ) Amounts reclassified from AOCI — (1 ) (1 ) (2 ) Net current period other comprehensive (loss) income (60 ) (1 ) 1 (60 ) Balance as of March 31, 2020 $ (320 ) $ (11 ) $ 2 $ (329 ) Reclassifications Out of AOCI For the three months ended March 31, 2020 Employee Benefit Plans In millions Amortization of Actuarial Loss (Gain) Amortization of Prior Service Benefit Effective Cash Flow Hedge Loss (Gain) Total Affected line in Condensed Consolidated Statement of Operations: Cost of products $ — $ — $ (1 ) $ (1 ) Cost of services (1 ) (1 ) — (2 ) Total before tax $ (1 ) $ (1 ) $ (1 ) $ (3 ) Tax expense 1 Total reclassifications, net of tax $ (2 ) For the three months ended March 31, 2019 Employee Benefit Plans In millions Amortization of Actuarial Loss (Gain) Amortization of Prior Service Benefit Effective Cash Flow Hedge Loss (Gain) Total Affected line in Condensed Consolidated Statement of Operations: Cost of products $ — $ — $ (1 ) $ (1 ) Cost of services (1 ) (2 ) — (3 ) Total before tax $ (1 ) $ (2 ) $ (1 ) $ (4 ) Tax expense — Total reclassifications, net of tax $ (4 ) |
Supplemental Financial Informat
Supplemental Financial Information | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Financial Information [Abstract] | |
SUPPLEMENTAL FINANCIAL INFORMATION | 15. SUPPLEMENTAL FINANCIAL INFORMATION The components of accounts receivable are summarized as follows: In millions March 31, 2020 December 31, 2019 Accounts receivable Trade $ 1,359 $ 1,482 Other 44 52 Accounts receivable, gross 1,403 1,534 Less: allowance for credit losses (50 ) (44 ) Total accounts receivable, net $ 1,353 $ 1,490 The components of inventory are summarized as follows: In millions March 31, 2020 December 31, 2019 Inventories Work in process and raw materials $ 190 $ 204 Finished goods 183 184 Service parts 374 396 Total inventories $ 747 $ 784 |
Condensed Consolidating Supplem
Condensed Consolidating Supplemental Guarantor Information | 3 Months Ended |
Mar. 31, 2020 | |
Condensed Consolidating Supplemental Guarantor Information [Abstract] | |
CONDENSED CONSOLIDATED SUPPLEMENTAL GUARANTOR INFORMATION | 16. CONDENSED CONSOLIDATING SUPPLEMENTAL GUARANTOR INFORMATION The Company's 5.00% Notes and 6.375% Notes are guaranteed by the Company's subsidiary, NCR International, Inc. (Guarantor Subsidiary), which is 100% owned by the Company and has guaranteed fully and unconditionally the obligations to pay principal and interest for these senior unsecured notes. The guarantees are subject to release under certain circumstances as described below: • the designation of the Guarantor Subsidiary as an unrestricted subsidiary under the indenture governing the notes; • the release of the Guarantor Subsidiary from its guarantee under the Senior Secured Credit Facility; • the release or discharge of the indebtedness that required the guarantee of the notes by the Guarantor Subsidiary; • the permitted sale or other disposition of the Guarantor Subsidiary to a third party; and • the Company's exercise of its legal defeasance option of its covenant defeasance option under the indenture governing the notes. Refer to Note 4, Debt Obligations for additional information. In connection with the previously completed registered exchange offers for the 5.00% Notes and 6.375% Notes, the Company is required to comply with Rule 3-10 of SEC Regulation S-X (Rule 3-10), and has therefore included the accompanying Condensed Consolidating Financial Statements in accordance with Rule 3-10(f) of SEC Regulation S-X. The following supplemental information sets forth, on a consolidating basis, the Condensed Statements of Operations and Comprehensive Income (Loss), the Condensed Balance Sheets and the Condensed Statements of Cash Flows for the parent issuer of these senior unsecured notes, for the Guarantor Subsidiary and for the Company and all of its consolidated subsidiaries. Condensed Consolidating Statements of Operations and Comprehensive Income (Loss) For the three months ended March 31, 2020 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Product revenue $ 211 $ 1 $ 313 $ (51 ) $ 474 Service revenue 547 1 481 — 1,029 Total revenue 758 2 794 (51 ) 1,503 Cost of products 177 — 265 (51 ) 391 Cost of services 389 1 325 — 715 Selling, general and administrative expenses 176 — 79 — 255 Research and development expenses 33 — 32 — 65 Total operating expenses 775 1 701 (51 ) 1,426 Income (loss) from operations (17 ) 1 93 — 77 Interest expense (48 ) — (3 ) 1 (50 ) Other (expense) income, net 5 — (6 ) (1 ) (2 ) Income (loss) from continuing operations before income taxes (60 ) 1 84 — 25 Income tax expense (benefit) (7 ) 1 7 — 1 Income (loss) from continuing operations before earnings in subsidiaries (53 ) — 77 — 24 Equity in earnings of consolidated subsidiaries 76 74 — (150 ) — Income (loss) from continuing operations 23 74 77 (150 ) 24 Income (loss) from discontinued operations, net of tax — — — — — Net income (loss) $ 23 $ 74 $ 77 $ (150 ) $ 24 Net income (loss) attributable to noncontrolling interests — — 1 — 1 Net income (loss) attributable to NCR $ 23 $ 74 $ 76 $ (150 ) $ 23 Total comprehensive income (loss) (37 ) 15 15 (30 ) (37 ) Less comprehensive income (loss) attributable to noncontrolling interests — — — — — Comprehensive income (loss) attributable to NCR common stockholders $ (37 ) $ 15 $ 15 $ (30 ) $ (37 ) Condensed Consolidating Statements of Operations and Comprehensive Income (Loss) For the three months ended March 31, 2019 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Product revenue $ 273 $ 2 $ 310 $ (46 ) $ 539 Service revenue 523 2 472 — 997 Total revenue 796 4 782 (46 ) 1,536 Cost of products 246 — 253 (46 ) 453 Cost of services 363 1 308 — 672 Selling, general and administrative expenses 140 — 112 — 252 Research and development expenses 33 — 26 — 59 Total operating expenses 782 1 699 (46 ) 1,436 Income (loss) from operations 14 3 83 — 100 Interest expense (43 ) — (5 ) 3 (45 ) Other (expense) income, net (13 ) 2 6 (3 ) (8 ) Income (loss) from continuing operations before income taxes (42 ) 5 84 — 47 Income tax expense (benefit) 49 (1 ) (39 ) — 9 Income (loss) from continuing operations before earnings in subsidiaries (91 ) 6 123 — 38 Equity in earnings of consolidated subsidiaries 128 97 — (225 ) — Income (loss) from continuing operations 37 103 123 (225 ) 38 Income (loss) from discontinued operations, net of tax — — — — — Net income (loss) $ 37 $ 103 $ 123 $ (225 ) $ 38 Net income (loss) attributable to noncontrolling interests — — 1 — 1 Net income (loss) attributable to NCR $ 37 $ 103 $ 122 $ (225 ) $ 37 Total comprehensive income (loss) 53 120 138 (257 ) 54 Less comprehensive income (loss) attributable to noncontrolling interests — — 1 — 1 Comprehensive income (loss) attributable to NCR common stockholders $ 53 $ 120 $ 137 $ (257 ) $ 53 Condensed Consolidating Balance Sheet March 31, 2020 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Assets Current assets Cash and cash equivalents $ 945 $ 3 $ 266 $ — $ 1,214 Accounts receivable, net 77 1 1,275 — 1,353 Inventories 236 1 510 — 747 Due from affiliates 853 2,218 1,794 (4,865 ) — Other current assets 220 1 242 — 463 Total current assets 2,331 2,224 4,087 (4,865 ) 3,777 Property, plant and equipment, net 265 — 134 — 399 Goodwill 2,186 — 635 — 2,821 Intangibles, net 456 — 124 — 580 Operating lease assets 238 — 124 — 362 Prepaid pension cost — — 176 — 176 Deferred income taxes 331 2 475 — 808 Investments in subsidiaries 4,119 3,958 — (8,077 ) — Due from affiliates 16 1 74 (91 ) — Other assets 563 1 68 — 632 Total assets $ 10,505 $ 6,186 $ 5,897 $ (13,033 ) $ 9,555 Liabilities and stockholders’ equity Current liabilities Short-term borrowings $ 9 $ — $ 295 $ — $ 304 Accounts payable 357 — 433 — 790 Payroll and benefits liabilities 88 — 98 — 186 Contract liabilities 336 1 279 — 616 Due to affiliates 2,963 109 1,793 (4,865 ) — Other current liabilities 218 1 291 — 510 Total current liabilities 3,971 111 3,189 (4,865 ) 2,406 Long-term debt 4,078 — 3 — 4,081 Pension and indemnity plan liabilities 590 — 265 — 855 Postretirement and postemployment benefits liabilities 16 3 93 — 112 Income tax accruals 30 — 59 — 89 Due to affiliates — 74 17 (91 ) — Operating lease liabilities 269 — 77 — 346 Other liabilities 132 — 112 — 244 Total liabilities 9,086 188 3,815 (4,956 ) 8,133 Redeemable noncontrolling interest — — — — — Series A convertible preferred stock 395 — — — 395 Stockholders’ equity Total NCR stockholders’ equity 1,024 5,998 2,079 (8,077 ) 1,024 Noncontrolling interests in subsidiaries — — 3 — 3 Total stockholders’ equity 1,024 5,998 2,082 (8,077 ) 1,027 Total liabilities and stockholders’ equity $ 10,505 $ 6,186 $ 5,897 $ (13,033 ) $ 9,555 Condensed Consolidating Balance Sheet December 31, 2019 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Assets Current assets Cash and cash equivalents $ 15 $ 3 491 $ — $ 509 Accounts receivable, net 54 1 1,435 — 1,490 Inventories 315 1 468 — 784 Due from affiliates 909 2,217 531 (3,657 ) — Other current assets 122 1 238 — 361 Total current assets 1,415 2,223 3,163 (3,657 ) 3,144 Property, plant and equipment, net 280 — 133 — 413 Goodwill 2,183 — 649 — 2,832 Intangibles, net 471 — 136 — 607 Operating lease assets 254 — 137 — 391 Prepaid pension cost — — 178 — 178 Deferred income taxes 335 2 484 — 821 Investments in subsidiaries 4,118 3,938 — (8,056 ) — Due from affiliates 16 1 74 (91 ) — Other assets 527 1 73 — 601 Total assets $ 9,599 $ 6,165 $ 5,027 $ (11,804 ) $ 8,987 Liabilities and stockholders’ equity Current liabilities Short-term borrowings $ 8 $ — $ 274 $ — $ 282 Accounts payable 427 — 413 — 840 Payroll and benefits liabilities 188 — 120 — 308 Contract liabilities 245 1 256 — 502 Due to affiliates 2,730 108 819 (3,657 ) — Other current liabilities 261 1 344 — 606 Total current liabilities 3,859 110 2,226 (3,657 ) 2,538 Long-term debt 3,199 — 78 — 3,277 Pension and indemnity plan liabilities 586 — 272 — 858 Postretirement and postemployment benefits liabilities 17 3 91 — 111 Income tax accruals 29 — 63 — 92 Due to affiliates — 74 17 (91 ) — Operating lease liabilities 282 — 87 — 369 Other liabilities 128 — 112 — 240 Total liabilities 8,100 187 2,946 (3,748 ) 7,485 Redeemable noncontrolling interest — — — — — Series A convertible preferred stock 395 — — — 395 Stockholders’ equity Total NCR stockholders’ equity 1,104 5,978 2,078 (8,056 ) 1,104 Noncontrolling interests in subsidiaries — — 3 — 3 Total stockholders’ equity 1,104 5,978 2,081 (8,056 ) 1,107 Total liabilities and stockholders’ equity $ 9,599 $ 6,165 $ 5,027 $ (11,804 ) $ 8,987 Condensed Consolidating Statement of Cash Flows For the three months ended March 31, 2020 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by (used in) operating activities $ (67 ) $ (10 ) $ 139 $ (1 ) $ 61 Investing activities Expenditures for property, plant and equipment (2 ) — (8 ) — (10 ) Proceeds from sales of property, plant and equipment 7 — — — 7 Additions to capitalized software (55 ) — (14 ) — (69 ) Proceeds from (payments of) intercompany notes 242 10 — (252 ) — Business acquisitions, net (6 ) — (20 ) — (26 ) Net cash provided by (used in) investing activities 186 10 (42 ) (252 ) (98 ) Financing activities Short term borrowings, net 2 — 1 — 3 Payments on term credit facilities (2 ) — — — (2 ) Payments on revolving credit facilities (430 ) — (143 ) — (573 ) Borrowings on revolving credit facilities 1,310 — 87 — 1,397 Repurchase of Common Stock (41 ) — — — (41 ) Debt issuance cost (1 ) — — — (1 ) Series A Preferred Stock Dividends (6 ) — — — (6 ) Proceeds from employee stock plans 3 — — — 3 Other financing activities (2 ) — (1 ) — (3 ) Dividend distribution to consolidated subsidiaries — — (1 ) 1 — Borrowings (repayments) of intercompany notes — — (252 ) 252 — Tax withholding payments on behalf of employees (24 ) — — — (24 ) Net change in client funds obligations — — 12 — 12 Net cash provided by (used in) financing activities 809 — (297 ) 253 765 Cash flows from discontinued operations Net cash used in operating activities 3 — — — 3 Effect of exchange rate changes on cash, cash equivalents and restricted cash — — (14 ) — (14 ) Increase (decrease) in cash, cash equivalents and restricted cash 931 — (214 ) — 717 Cash, cash equivalents and restricted cash at beginning of period 15 3 530 — 548 Cash, cash equivalents and restricted cash at end of period $ 946 $ 3 $ 316 $ — $ 1,265 In millions March 31, 2020 Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ 945 $ 3 $ 266 $ — $ 1,214 Restricted cash and restricted cash equivalents including funds held for clients included in other assets 1 — 50 — 51 Total cash, cash equivalents and restricted cash $ 946 $ 3 $ 316 $ — $ 1,265 Condensed Consolidating Statement of Cash Flows For the three months ended March 31, 2019 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by (used in) operating activities $ 111 $ (20 ) $ (107 ) $ — $ (16 ) Investing activities Expenditures for property, plant and equipment (13 ) — (9 ) — (22 ) Additions to capitalized software (36 ) — (7 ) — (43 ) Proceeds from (payments of) intercompany notes 29 30 — (59 ) — Investments in equity affiliates — — 10 (10 ) — Business acquisitions, net (6 ) — — — (6 ) Net change in funds held for clients — — — — — Other investing activities, net 3 — — — 3 Net cash provided by (used in) investing activities (23 ) 30 (6 ) (69 ) (68 ) Financing activities Short term borrowings, net — — 7 — 7 Payments on term credit facilities (17 ) — — — (17 ) Payments on revolving credit facilities (375 ) — — — (375 ) Borrowings on revolving credit facilities 330 — 100 — 430 Proceeds from employee stock plans 4 — — — 4 Equity contribution — (10 ) — 10 — Net change in client funds obligations — — 17 — 17 Borrowings (repayments) of intercompany notes — — (59 ) 59 — Tax withholding payments on behalf of employees (13 ) — — — (13 ) Net cash provided by (used in) financing activities (71 ) (10 ) 65 69 53 Cash flows from discontinued operations Net cash used in operating activities (6 ) — — — (6 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash — — 1 — 1 Increase (decrease) in cash, cash equivalents, and restricted cash 11 — (47 ) — (36 ) Cash, cash equivalents and restricted cash at beginning of period 11 3 508 — 522 Cash, cash equivalents and restricted cash at end of period $ 22 $ 3 $ 461 $ — $ 486 In millions March 31, 2019 Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ 21 $ 3 $ 390 $ — $ 414 Restricted cash and restricted cash equivalents including funds held for clients included in other assets 1 — 71 — 72 Total cash, cash equivalents and restricted cash $ 22 $ 3 $ 461 $ — $ 486 |
Subsequent Events Presentation
Subsequent Events Presentation (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | 17. SUBSEQUENT EVENTS Acquisition of OKI Brasil On June 6, 2019, we entered into a definitive agreement with Oki Electric Industry Co., Ltd. and its Brazilian subsidiary, Oki Brasil Industria e Comércio de Produtos e Tecnologia em Automação S.A., to purchase OKI Brasil's IT services and select software assets for use in the financial, retail and other industries. Neither OKI's manufacturing operations nor its printing business in Brazil are included in the acquisition. On April 9, 2020, we completed this acquisition through the purchase of 100% of the quotas of Origami Brasil Tecnologia e Serviços em Automação Ltda., which became a wholly owned subsidiary of our subsidiary, NCR Brasil, Ltda. Senior Unsecured Notes On April 13, 2020, the Company issued $ 400 million aggregate principal amount of 8.125% senior unsecured notes due in 2025 (the 8.125% Notes). The 8.125% Notes were sold at 100% of the principal amount, which resulted in total gross proceeds of $ 400 million . Interest is payable on the Notes semi-annually in arrears at an annual rate of 8.125% , on April 15 and October 15 of each year, beginning on October 15, 2020. The Notes will mature on April 15, 2025. The 8.125% Notes are unsecured senior obligations of the Company and are guaranteed by the Company's wholly-owned subsidiary, NCR International, Inc. (Guarantor Subsidiary), which is 100% owned by the Company and has guaranteed fully and unconditionally the obligations to pay principal and interest for these senior unsecured notes. The Company has the option to redeem the 8.125% Notes, in whole or in part, at any time on or after April 15, 2022, at a redemption price of 104.063% , 102.031% , and 100% during the 12-month periods commencing on April 15, 2022, 2023 and 2024 and thereafter, respectively, plus accrued and unpaid interest to the redemption date. Prior to April 15, 2022, the Company may redeem some or all of the 8.125% Notes by paying a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus the Applicable Premium, as defined in the Indenture, as of, and accrued and unpaid interest to, but excluding, the redemption date (subject to the right of holders of record of the Notes on the relevant record date to receive interest due on the relevant interest payment date). |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying Condensed Consolidated Financial Statements have been prepared by NCR Corporation (NCR, the Company, we or us) without audit pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC) and, in the opinion of management, include all adjustments (consisting of normal, recurring adjustments, unless otherwise disclosed) necessary for a fair statement of the consolidated results of operations, financial position, and cash flows for each period presented. The consolidated results for the interim periods are not necessarily indicative of results to be expected for the full year. The 2019 year-end Condensed Consolidated Balance Sheet was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States (GAAP). These financial statements should be read in conjunction with NCR’s Form 10-K for the year ended December 31, 2019 . |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and revenue and expenses during the period reported. Actual results could differ from those estimates. |
Evaluation of Subsequent Events | Evaluation of Subsequent Events The Company evaluated subsequent events through the date that our Condensed Consolidated Financial Statements were issued. Except as described within Note 17, Subsequent Events , no matters were identified that required adjustment of the Condensed Consolidated Financial Statements or additional disclosure. |
Reclassifications | Reclassifications Certain prior-period amounts have been reclassified in the accompanying Condensed Consolidated Financial Statements and Notes thereto in order to conform to the current period presentation. Reclassifications had no effect on prior year net income or shareholders’ equity. |
Remaining Performance Obligations | Remaining Performance Obligations Remaining performance obligations represent the transaction price of orders for which products have not been delivered or services have not been performed. As of March 31, 2020 , the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $4.0 billion . The Company expects to recognize revenue on approximately three-quarters of the remaining performance obligations over the next 12 months, with the remainder recognized thereafter. The majority of our professional services are expected to be recognized over the next 12 months but this is contingent upon a number of factors, including customers’ needs and schedules. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Issued In December 2019, the Financial Accounting Standards Board ("FASB") issued an accounting standards update with new guidance which removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. This accounting standards update also adds guidance to reduce complexity in certain areas, including recognizing measures for the accounting for income taxes. This accounting standards update is effective for fiscal years and interim periods beginning after December 15, 2020, with early adoption permitted. The Company is evaluating the impact that adopting this guidance will have on our consolidated financial statements. Adopted In June 2016, the FASB issued an accounting standards update with new guidance on accounting for credit losses on financial instruments. The new guidance includes an impairment model for estimating credit losses that is based on expected losses, rather than incurred losses. This accounting standards update is effective prospectively for fiscal years and interim periods beginning after December 15, 2019, with early adoption permitted. The adoption of this accounting standards update did not have a material effect on the Company's net income, cash flows or financial condition. In August 2018, the Financial Accounting Standards Board (FASB) issued an accounting standards update with new guidance on fair value measurement disclosure requirements that requires the disclosure of additions to and transfers into and out of Level 3 of the fair value hierarchy. This accounting standards update also requires disclosure about the uncertainty in measurement as of the reporting date. The new standard became effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted. The adoption of this accounting standards update did not have a material impact on our financial statement disclosures. In August 2018, the FASB issued an accounting standards update related to accounting for implementation costs incurred in a cloud computing arrangement that is also a service contract. If a cloud computing arrangement also includes an internal-use software, an intangible asset is recognized, and a liability is recognized for any payments related to the software license. However, if a cloud computing arrangement does not include a software license, the entity should account for the arrangement as a service contract and any fees associated with the service are expensed as incurred. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. The adoption of this accounting standards update did not have a material effect on the Company's net income, cash flows or financial condition. |
Lessor | Lessor We have various arrangements for certain point-of-sale equipment under which we are the lessor. These leases meet the criteria for operating lease classification. Lease income associated with these leases is not material. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Net Contract Assets and Contract Liabilities Balances | The following table presents the net contract asset and contract liability balances as of March 31, 2020 and December 31, 2019 . In millions Location in the Condensed Consolidated Balance Sheet March 31, 2020 December 31, 2019 Current portion of contract assets Other current assets $ 9 $ 9 Current portion of contract liabilities Contract liabilities $ 616 $ 502 Non-current portion of contract liabilities Other liabilities $ 75 $ 81 |
Segment Information and Conce_2
Segment Information and Concentrations (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Operating Income by Segment | The following table presents revenue and operating income by segment: In millions Three months ended March 31 2020 2019 Revenue by segment Banking $ 763 $ 758 Retail 472 511 Hospitality 169 193 Other 99 74 Consolidated revenue $ 1,503 $ 1,536 Operating income by segment Banking $ 103 $ 95 Retail 5 26 Hospitality (9 ) 16 Other 5 10 Subtotal - segment operating income 104 147 Other adjustments (1) 27 47 Income from operations $ 77 $ 100 (1) The following table presents the other adjustments for NCR: In millions Three months ended March 31 2020 2019 Transformation and restructuring costs $ 5 $ 26 Acquisition-related amortization of intangible assets 22 21 Total other adjustments $ 27 $ 47 |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block] | The following table presents revenue by geography for NCR: In millions Three months ended March 31 2020 2019 Americas $ 892 $ 920 Europe, Middle East and Africa (EMEA) 403 419 Asia Pacific (APJ) 208 197 Total revenue $ 1,503 $ 1,536 |
Schedule of Revenues from Products and Services | The following tables present revenue from products and services for NCR: In millions Three months ended March 31 2020 2019 Product revenue $ 474 $ 539 Professional services and installation services revenue 227 238 Recurring revenue, including maintenance, cloud revenue and payments 802 759 Total revenue $ 1,503 $ 1,536 In millions Three months ended March 31 2020 2019 Software $ 474 $ 467 Services 636 585 Hardware 393 484 Total revenue $ 1,503 $ 1,536 |
Goodwill and Long-Lived Assets
Goodwill and Long-Lived Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill by Segment | The carrying amounts of goodwill by segment as of March 31, 2020 and December 31, 2019 are included in the table below. Foreign currency fluctuations are included within other adjustments . December 31, 2019 March 31, 2020 In millions Goodwill Accumulated Impairment Losses Total Additions Impairment Other Goodwill Accumulated Impairment Losses Total Banking $ 1,774 $ (101 ) $ 1,673 $ — $ — $ (3 ) $ 1,771 $ (101 ) $ 1,670 Retail 638 (34 ) 604 — — (9 ) 629 (34 ) 595 Hospitality 402 (23 ) 379 3 — (2 ) 403 (23 ) 380 Other 187 (11 ) 176 — — — 187 (11 ) 176 Total goodwill $ 3,001 $ (169 ) $ 2,832 $ 3 $ — $ (14 ) $ 2,990 $ (169 ) $ 2,821 |
Schedule of Purchased Intangible Assets | NCR's purchased intangible assets, reported in intangibles, net in the Condensed Consolidated Balance Sheets, were specifically identified when acquired, and are deemed to have finite lives. The gross carrying amount and accumulated amortization for NCR’s identifiable intangible assets were as set forth in the table below. Amortization Period (in Years) March 31, 2020 December 31, 2019 In millions Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Identifiable intangible assets Reseller & customer relationships 1 - 20 $ 735 $ (284 ) $ 735 $ (270 ) Intellectual property 2 - 8 524 (403 ) 529 (397 ) Customer contracts 8 89 (89 ) 89 (89 ) Tradenames 1 - 10 78 (70 ) 78 (68 ) Total identifiable intangible assets $ 1,426 $ (846 ) $ 1,431 $ (824 ) |
Schedule of Aggregate Amortization Expense | The aggregate amortization expense (actual and estimated) for identifiable intangible assets for the following periods is: In millions Three months ended March 31, 2020 Remainder of 2020 (estimated) Amortization expense $ 22 $ 60 For the years ended December 31 (estimated) In millions 2021 2022 2023 2024 2025 Amortization expense $ 73 $ 68 $ 66 $ 59 $ 51 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Obligations | The following table summarizes the Company's short-term borrowings and long-term debt: March 31, 2020 December 31, 2019 In millions, except percentages Amount Weighted-Average Interest Rate Amount Weighted-Average Interest Rate Short-Term Borrowings Current portion of Senior Secured Credit Facility (1) $ 7 4.30% $ 8 4.30% Trade Receivables Securitization Facility 293 2.65% 270 2.65% Other (1) 4 4.25% 4 2.82% Total short-term borrowings $ 304 $ 282 Long-Term Debt Senior Secured Credit Facility: Term loan facility (1) $ 739 4.30% $ 740 4.30% Revolving credit facility (1) 1,070 3.77% 265 3.76% Senior notes: 5.00% Senior Notes due 2022 600 600 6.375% Senior Notes due 2023 700 700 5.750% Senior Notes due 2027 500 500 6.125% Senior Notes due 2029 500 500 Deferred financing fees (31 ) (32 ) Other (1) 3 —% 4 0.05% Total long-term debt $ 4,081 $ 3,277 (1) Interest rates are weighted-average interest rates as of March 31, 2020 and December 31, 2019 . |
Stock Compensation Plans (Table
Stock Compensation Plans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock-based Compensation Expense | Stock-based compensation expense for the following periods were: In millions Three months ended March 31 2020 2019 Restricted stock units $ 19 $ 20 Stock options 4 2 Employee stock purchase plan 2 1 Stock-based compensation expense 25 23 Tax benefit (3 ) (3 ) Stock-based compensation expense (net of tax) $ 22 $ 20 |
Schedule of Valuation Assumptions Used To Estimate Fair Value of Stock Options | he weighted average fair value of the option grants was $7.85 based on using a Monte-Carlo simulation model and will be recognized over the requisite service period. These option grants have a seven year contractual term that vest at the end of 36 months. For the three months ended March 31, 2019 , the weighted average fair value of option grants was $8.07 with a seven year contractual term that vest ratably over four years . The table below details the assumptions used in determining the fair value of the option grants. Three months ended March 31 2020 2019 Dividend yield $ — $ — Risk-free interest rate 1.46 % 2.50 % Expected volatility 33.38 % 34.79 % Expected holding period (years) 3.7 3.9 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Pension Plan [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of Defined Benefit Plans Disclosures [Table Text Block] | Components of net periodic benefit cost (income) of the pension plans for the three months ended March 31 were as follows: In millions U.S. Pension Benefits International Pension Benefits Total Pension Benefits 2020 2019 2020 2019 2020 2019 Net service cost $ — $ — $ 1 $ 2 $ 1 $ 2 Interest cost 13 16 4 5 17 21 Expected return on plan assets (9 ) (10 ) (7 ) (8 ) (16 ) (18 ) Net periodic benefit cost (income) $ 4 $ 6 $ (2 ) $ (1 ) $ 2 $ 5 |
Postretirement Plan | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of Defined Benefit Plans Disclosures [Table Text Block] | The benefit from the postretirement plan for the following periods were: In millions Three months ended March 31 2020 2019 Interest cost $ — $ — Amortization of: Prior service benefit (1 ) (1 ) Net postretirement benefit $ (1 ) $ (1 ) |
Postemployment Retirement Benefits [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of Defined Benefit Plans Disclosures [Table Text Block] | The net cost of the postemployment plan for the following periods were: Three months ended March 31 In millions 2020 2019 Net service cost $ 6 $ 14 Interest cost — 1 Amortization of: Prior service benefit — (1 ) Actuarial gain (1 ) (1 ) Net benefit cost $ 5 $ 13 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Product Warranty Liability | The Company recorded the activity related to the warranty reserve for the three months ended March 31 as follows: In millions 2020 2019 Warranty reserve liability Beginning balance as of January 1 $ 21 $ 26 Accruals for warranties issued 8 8 Settlements (in cash or in kind) (11 ) (10 ) Ending balance as of March 31 $ 18 $ 24 |
Leasing (Tables)
Leasing (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Lease Balances | The following table presents our lease balances as of March 31, 2020 and December 31, 2019 : In millions Location in the Condensed Consolidated Balance Sheet March 31, 2020 December 31, 2019 Assets Operating lease assets Operating lease assets $ 362 $ 391 Finance lease assets Property, plant and equipment, net 47 38 Accumulated Amortization of Finance lease assets Property, plant and equipment, net (8 ) (5 ) Total leased assets $ 401 $ 424 Liabilities Current Operating lease liabilities Other current liabilities $ 88 $ 91 Finance lease liabilities Other current liabilities 13 10 Noncurrent Operating lease liabilities Operating lease liabilities 346 369 Finance lease liabilities Other liabilities 28 25 Total lease liabilities $ 475 $ 495 |
Schedule of Lease Costs, Supplemental Cash Flow Information, Lease Term and Interest Rate | The following table presents our lease costs for operating and finance leases: In millions Three months ended March 31 2020 2019 Operating lease cost $ 32 $ 35 Finance lease cost Amortization of leased assets 3 — Interest on lease liabilities — — Short-Term lease cost 1 2 Variable lease cost 7 9 Total lease cost $ 43 $ 46 The following table presents the supplemental cash flow information: In millions Three months ended March 31 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 30 $ 32 Operating cash flows from finance leases $ — $ — Financing cash flows from finance leases $ 3 $ — Lease Assets Obtained in Exchange for Lease Obligations Operating Leases $ (2 ) $ 12 Finance Leases $ 8 $ 1 The following table presents the weighted average remaining lease term and interest rates: March 31, 2020 December 31, 2019 Weighted average lease term: Operating leases 9.1 years 8.9 years Finance leases 3.2 years 3.4 years Weighted average interest rates: Operating leases 6.39 % 6.42 % Finance leases 4.15 % 3.72 % |
Schedule of Reconciliation of Undiscounted Cash Flows of Operating Lease Liabilities | The following table reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities recorded on the Condensed Consolidated Balance Sheet as of March 31, 2020 : In millions Operating Leases Finance Leases Remainder of 2020 $ 88 $ 10 2021 86 14 2022 64 13 2023 44 6 2024 38 — Thereafter 272 — Total lease payments 592 43 Less: Amount representing interest (158 ) (2 ) Present value of lease liabilities $ 434 $ 41 |
Schedule of Reconciliation of Undiscounted Cash Flows of Finance Lease Liabilities | The following table reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities recorded on the Condensed Consolidated Balance Sheet as of March 31, 2020 : In millions Operating Leases Finance Leases Remainder of 2020 $ 88 $ 10 2021 86 14 2022 64 13 2023 44 6 2024 38 — Thereafter 272 — Total lease payments 592 43 Less: Amount representing interest (158 ) (2 ) Present value of lease liabilities $ 434 $ 41 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Components of Earnings Per Share | The components of basic earnings per share are as follows: In millions, except per share amounts Three months ended March 31 2020 2019 Numerator: Income from continuing operations $ 23 $ 37 Dividends on Series A Convertible Preferred Stock (6 ) (13 ) Income from continuing operations attributable to NCR common stockholders 17 24 Loss from discontinued operations, net of tax — — Net income attributable to NCR common stockholders $ 17 $ 24 Denominator: Basic weighted average number of shares outstanding 128.0 119.3 Basic earnings per share: From continuing operations $ 0.13 $ 0.20 From discontinued operations — — Total basic earnings per share $ 0.13 $ 0.20 The components of diluted earnings per share are as follows: In millions, except per share amounts Three months ended March 31 2020 2019 Numerator: Income from continuing operations $ 23 $ 37 Dividends on Series A Convertible Preferred Stock (6 ) (13 ) Income from continuing operations attributable to NCR common stockholders 17 24 Loss from discontinued operations, net of tax — — Net income attributable to NCR common stockholders $ 17 $ 24 Denominator: Basic weighted average number of shares outstanding 128.0 119.3 Dilutive effect of restricted stock units and stock options 2.5 2.9 Weighted average diluted shares 130.5 122.2 Diluted earnings per share: From continuing operations $ 0.13 $ 0.20 From discontinued operations — — Total diluted earnings per share $ 0.13 $ 0.20 |
Derivatives and Hedging Instr_2
Derivatives and Hedging Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule Location and Amounts of Derivative Fair Values in the Condensed Consolidated Balance Sheets | The following tables provide information on the location and amounts of derivative fair values in the Condensed Consolidated Balance Sheets: Fair Values of Derivative Instruments March 31, 2020 In millions Balance Sheet Location Notional Amount Fair Value Balance Sheet Location Notional Amount Fair Value Derivatives designated as hedging instruments Foreign exchange contracts Other current assets $ 155 $ 5 Other current liabilities $ 79 $ 2 Total derivatives designated as hedging instruments $ 5 $ 2 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets $ 175 $ 1 Other current liabilities $ 319 $ 4 Total derivatives not designated as hedging instruments $ 1 $ 4 Total derivatives $ 6 $ 6 Fair Values of Derivative Instruments December 31, 2019 In millions Balance Sheet Location Notional Amount Fair Value Balance Sheet Location Notional Amount Fair Value Derivatives designated as hedging instruments Foreign exchange contracts Other current assets $ 55 $ 1 Other current liabilities $ — $ — Total derivatives designated as hedging instruments $ 1 $ — Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets $ 71 $ 1 Other current liabilities $ 264 $ 1 Total derivatives not designated as hedging instruments $ 1 $ 1 Total derivatives $ 2 $ 1 |
Schedule Effects of Derivative Instruments on the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income | The effects of derivative instruments on the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2020 and 2019 were as follows: In millions Amount of Gain (Loss) Recognized in Other Comprehensive Income (OCI) on Derivative Amount of (Gain) Loss Reclassified from AOCI into the Condensed Consolidated Statement of Operations Derivatives in Cash Flow Hedging Relationships For the three months ended March 31, 2020 For the three months ended March 31, 2019 Location of (Gain) Loss Reclassified from AOCI into the Condensed Consolidated Statement of Operations For the three months ended March 31, 2020 For the three months ended March 31, 2019 Foreign exchange contracts $ 3 $ 1 Cost of products $ (1 ) $ (1 ) In millions Amount of Gain (Loss) Recognized in the Condensed Consolidated Statement of Operations Three months ended March 31 Derivatives not Designated as Hedging Instruments Location of Gain (Loss) Recognized in the Condensed Consolidated Statement of Operations 2020 2019 Foreign exchange contracts Other (expense), net $ 6 $ (5 ) |
Fair Value of Assets and Liab_2
Fair Value of Assets and Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis | Assets and liabilities recorded at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 are set forth as follows: March 31, 2020 In millions Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Deposits held in money market mutual funds (1) $ 937 $ 937 $ — $ — Foreign exchange contracts (2) 6 — 6 — Total $ 943 $ 937 $ 6 $ — Liabilities: Foreign exchange contracts (3) $ 6 $ — $ 6 $ — Total $ 6 $ — $ 6 $ — December 31, 2019 In millions Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Deposits held in money market mutual funds (1) $ 15 $ 15 $ — $ — Foreign exchange contracts (2) 2 — 2 — Total $ 17 $ 15 $ 2 $ — Liabilities: Foreign exchange contracts (3) $ 1 $ — $ 1 $ — Total $ 1 $ — $ 1 $ — (1) Included in Cash and cash equivalents in the Condensed Consolidated Balance Sheets. (2) Included in Other current assets in the Condensed Consolidated Balance Sheets. (3) |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (AOCI) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
Schedule of Changes in AOCI by Component | Changes in AOCI by Component In millions Currency Translation Adjustments Changes in Employee Benefit Plans Changes in Fair Value of Effective Cash Flow Hedges Total Balance as of December 31, 2019 $ (260 ) $ (10 ) $ 1 $ (269 ) Other comprehensive income (loss) before reclassifications (60 ) — 2 (58 ) Amounts reclassified from AOCI — (1 ) (1 ) (2 ) Net current period other comprehensive (loss) income (60 ) (1 ) 1 (60 ) Balance as of March 31, 2020 $ (320 ) $ (11 ) $ 2 $ (329 ) |
Reclassification out of AOCI | Reclassifications Out of AOCI For the three months ended March 31, 2020 Employee Benefit Plans In millions Amortization of Actuarial Loss (Gain) Amortization of Prior Service Benefit Effective Cash Flow Hedge Loss (Gain) Total Affected line in Condensed Consolidated Statement of Operations: Cost of products $ — $ — $ (1 ) $ (1 ) Cost of services (1 ) (1 ) — (2 ) Total before tax $ (1 ) $ (1 ) $ (1 ) $ (3 ) Tax expense 1 Total reclassifications, net of tax $ (2 ) For the three months ended March 31, 2019 Employee Benefit Plans In millions Amortization of Actuarial Loss (Gain) Amortization of Prior Service Benefit Effective Cash Flow Hedge Loss (Gain) Total Affected line in Condensed Consolidated Statement of Operations: Cost of products $ — $ — $ (1 ) $ (1 ) Cost of services (1 ) (2 ) — (3 ) Total before tax $ (1 ) $ (2 ) $ (1 ) $ (4 ) Tax expense — Total reclassifications, net of tax $ (4 ) |
Supplemental Financial Inform_2
Supplemental Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Financial Information [Abstract] | |
Schedule of Components of Accounts Receivable | The components of accounts receivable are summarized as follows: In millions March 31, 2020 December 31, 2019 Accounts receivable Trade $ 1,359 $ 1,482 Other 44 52 Accounts receivable, gross 1,403 1,534 Less: allowance for credit losses (50 ) (44 ) Total accounts receivable, net $ 1,353 $ 1,490 |
Schedule of Components of Inventory | The components of inventory are summarized as follows: In millions March 31, 2020 December 31, 2019 Inventories Work in process and raw materials $ 190 $ 204 Finished goods 183 184 Service parts 374 396 Total inventories $ 747 $ 784 |
Condensed Consolidating Suppl_2
Condensed Consolidating Supplemental Guarantor Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Condensed Consolidating Supplemental Guarantor Information [Abstract] | |
Schedule of Condensed Consolidating Supplemental Guarantor Information | Condensed Consolidating Statements of Operations and Comprehensive Income (Loss) For the three months ended March 31, 2020 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Product revenue $ 211 $ 1 $ 313 $ (51 ) $ 474 Service revenue 547 1 481 — 1,029 Total revenue 758 2 794 (51 ) 1,503 Cost of products 177 — 265 (51 ) 391 Cost of services 389 1 325 — 715 Selling, general and administrative expenses 176 — 79 — 255 Research and development expenses 33 — 32 — 65 Total operating expenses 775 1 701 (51 ) 1,426 Income (loss) from operations (17 ) 1 93 — 77 Interest expense (48 ) — (3 ) 1 (50 ) Other (expense) income, net 5 — (6 ) (1 ) (2 ) Income (loss) from continuing operations before income taxes (60 ) 1 84 — 25 Income tax expense (benefit) (7 ) 1 7 — 1 Income (loss) from continuing operations before earnings in subsidiaries (53 ) — 77 — 24 Equity in earnings of consolidated subsidiaries 76 74 — (150 ) — Income (loss) from continuing operations 23 74 77 (150 ) 24 Income (loss) from discontinued operations, net of tax — — — — — Net income (loss) $ 23 $ 74 $ 77 $ (150 ) $ 24 Net income (loss) attributable to noncontrolling interests — — 1 — 1 Net income (loss) attributable to NCR $ 23 $ 74 $ 76 $ (150 ) $ 23 Total comprehensive income (loss) (37 ) 15 15 (30 ) (37 ) Less comprehensive income (loss) attributable to noncontrolling interests — — — — — Comprehensive income (loss) attributable to NCR common stockholders $ (37 ) $ 15 $ 15 $ (30 ) $ (37 ) Condensed Consolidating Statements of Operations and Comprehensive Income (Loss) For the three months ended March 31, 2019 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Product revenue $ 273 $ 2 $ 310 $ (46 ) $ 539 Service revenue 523 2 472 — 997 Total revenue 796 4 782 (46 ) 1,536 Cost of products 246 — 253 (46 ) 453 Cost of services 363 1 308 — 672 Selling, general and administrative expenses 140 — 112 — 252 Research and development expenses 33 — 26 — 59 Total operating expenses 782 1 699 (46 ) 1,436 Income (loss) from operations 14 3 83 — 100 Interest expense (43 ) — (5 ) 3 (45 ) Other (expense) income, net (13 ) 2 6 (3 ) (8 ) Income (loss) from continuing operations before income taxes (42 ) 5 84 — 47 Income tax expense (benefit) 49 (1 ) (39 ) — 9 Income (loss) from continuing operations before earnings in subsidiaries (91 ) 6 123 — 38 Equity in earnings of consolidated subsidiaries 128 97 — (225 ) — Income (loss) from continuing operations 37 103 123 (225 ) 38 Income (loss) from discontinued operations, net of tax — — — — — Net income (loss) $ 37 $ 103 $ 123 $ (225 ) $ 38 Net income (loss) attributable to noncontrolling interests — — 1 — 1 Net income (loss) attributable to NCR $ 37 $ 103 $ 122 $ (225 ) $ 37 Total comprehensive income (loss) 53 120 138 (257 ) 54 Less comprehensive income (loss) attributable to noncontrolling interests — — 1 — 1 Comprehensive income (loss) attributable to NCR common stockholders $ 53 $ 120 $ 137 $ (257 ) $ 53 Condensed Consolidating Balance Sheet March 31, 2020 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Assets Current assets Cash and cash equivalents $ 945 $ 3 $ 266 $ — $ 1,214 Accounts receivable, net 77 1 1,275 — 1,353 Inventories 236 1 510 — 747 Due from affiliates 853 2,218 1,794 (4,865 ) — Other current assets 220 1 242 — 463 Total current assets 2,331 2,224 4,087 (4,865 ) 3,777 Property, plant and equipment, net 265 — 134 — 399 Goodwill 2,186 — 635 — 2,821 Intangibles, net 456 — 124 — 580 Operating lease assets 238 — 124 — 362 Prepaid pension cost — — 176 — 176 Deferred income taxes 331 2 475 — 808 Investments in subsidiaries 4,119 3,958 — (8,077 ) — Due from affiliates 16 1 74 (91 ) — Other assets 563 1 68 — 632 Total assets $ 10,505 $ 6,186 $ 5,897 $ (13,033 ) $ 9,555 Liabilities and stockholders’ equity Current liabilities Short-term borrowings $ 9 $ — $ 295 $ — $ 304 Accounts payable 357 — 433 — 790 Payroll and benefits liabilities 88 — 98 — 186 Contract liabilities 336 1 279 — 616 Due to affiliates 2,963 109 1,793 (4,865 ) — Other current liabilities 218 1 291 — 510 Total current liabilities 3,971 111 3,189 (4,865 ) 2,406 Long-term debt 4,078 — 3 — 4,081 Pension and indemnity plan liabilities 590 — 265 — 855 Postretirement and postemployment benefits liabilities 16 3 93 — 112 Income tax accruals 30 — 59 — 89 Due to affiliates — 74 17 (91 ) — Operating lease liabilities 269 — 77 — 346 Other liabilities 132 — 112 — 244 Total liabilities 9,086 188 3,815 (4,956 ) 8,133 Redeemable noncontrolling interest — — — — — Series A convertible preferred stock 395 — — — 395 Stockholders’ equity Total NCR stockholders’ equity 1,024 5,998 2,079 (8,077 ) 1,024 Noncontrolling interests in subsidiaries — — 3 — 3 Total stockholders’ equity 1,024 5,998 2,082 (8,077 ) 1,027 Total liabilities and stockholders’ equity $ 10,505 $ 6,186 $ 5,897 $ (13,033 ) $ 9,555 Condensed Consolidating Balance Sheet December 31, 2019 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Assets Current assets Cash and cash equivalents $ 15 $ 3 491 $ — $ 509 Accounts receivable, net 54 1 1,435 — 1,490 Inventories 315 1 468 — 784 Due from affiliates 909 2,217 531 (3,657 ) — Other current assets 122 1 238 — 361 Total current assets 1,415 2,223 3,163 (3,657 ) 3,144 Property, plant and equipment, net 280 — 133 — 413 Goodwill 2,183 — 649 — 2,832 Intangibles, net 471 — 136 — 607 Operating lease assets 254 — 137 — 391 Prepaid pension cost — — 178 — 178 Deferred income taxes 335 2 484 — 821 Investments in subsidiaries 4,118 3,938 — (8,056 ) — Due from affiliates 16 1 74 (91 ) — Other assets 527 1 73 — 601 Total assets $ 9,599 $ 6,165 $ 5,027 $ (11,804 ) $ 8,987 Liabilities and stockholders’ equity Current liabilities Short-term borrowings $ 8 $ — $ 274 $ — $ 282 Accounts payable 427 — 413 — 840 Payroll and benefits liabilities 188 — 120 — 308 Contract liabilities 245 1 256 — 502 Due to affiliates 2,730 108 819 (3,657 ) — Other current liabilities 261 1 344 — 606 Total current liabilities 3,859 110 2,226 (3,657 ) 2,538 Long-term debt 3,199 — 78 — 3,277 Pension and indemnity plan liabilities 586 — 272 — 858 Postretirement and postemployment benefits liabilities 17 3 91 — 111 Income tax accruals 29 — 63 — 92 Due to affiliates — 74 17 (91 ) — Operating lease liabilities 282 — 87 — 369 Other liabilities 128 — 112 — 240 Total liabilities 8,100 187 2,946 (3,748 ) 7,485 Redeemable noncontrolling interest — — — — — Series A convertible preferred stock 395 — — — 395 Stockholders’ equity Total NCR stockholders’ equity 1,104 5,978 2,078 (8,056 ) 1,104 Noncontrolling interests in subsidiaries — — 3 — 3 Total stockholders’ equity 1,104 5,978 2,081 (8,056 ) 1,107 Total liabilities and stockholders’ equity $ 9,599 $ 6,165 $ 5,027 $ (11,804 ) $ 8,987 Condensed Consolidating Statement of Cash Flows For the three months ended March 31, 2020 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by (used in) operating activities $ (67 ) $ (10 ) $ 139 $ (1 ) $ 61 Investing activities Expenditures for property, plant and equipment (2 ) — (8 ) — (10 ) Proceeds from sales of property, plant and equipment 7 — — — 7 Additions to capitalized software (55 ) — (14 ) — (69 ) Proceeds from (payments of) intercompany notes 242 10 — (252 ) — Business acquisitions, net (6 ) — (20 ) — (26 ) Net cash provided by (used in) investing activities 186 10 (42 ) (252 ) (98 ) Financing activities Short term borrowings, net 2 — 1 — 3 Payments on term credit facilities (2 ) — — — (2 ) Payments on revolving credit facilities (430 ) — (143 ) — (573 ) Borrowings on revolving credit facilities 1,310 — 87 — 1,397 Repurchase of Common Stock (41 ) — — — (41 ) Debt issuance cost (1 ) — — — (1 ) Series A Preferred Stock Dividends (6 ) — — — (6 ) Proceeds from employee stock plans 3 — — — 3 Other financing activities (2 ) — (1 ) — (3 ) Dividend distribution to consolidated subsidiaries — — (1 ) 1 — Borrowings (repayments) of intercompany notes — — (252 ) 252 — Tax withholding payments on behalf of employees (24 ) — — — (24 ) Net change in client funds obligations — — 12 — 12 Net cash provided by (used in) financing activities 809 — (297 ) 253 765 Cash flows from discontinued operations Net cash used in operating activities 3 — — — 3 Effect of exchange rate changes on cash, cash equivalents and restricted cash — — (14 ) — (14 ) Increase (decrease) in cash, cash equivalents and restricted cash 931 — (214 ) — 717 Cash, cash equivalents and restricted cash at beginning of period 15 3 530 — 548 Cash, cash equivalents and restricted cash at end of period $ 946 $ 3 $ 316 $ — $ 1,265 In millions March 31, 2020 Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ 945 $ 3 $ 266 $ — $ 1,214 Restricted cash and restricted cash equivalents including funds held for clients included in other assets 1 — 50 — 51 Total cash, cash equivalents and restricted cash $ 946 $ 3 $ 316 $ — $ 1,265 Condensed Consolidating Statement of Cash Flows For the three months ended March 31, 2019 In millions Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by (used in) operating activities $ 111 $ (20 ) $ (107 ) $ — $ (16 ) Investing activities Expenditures for property, plant and equipment (13 ) — (9 ) — (22 ) Additions to capitalized software (36 ) — (7 ) — (43 ) Proceeds from (payments of) intercompany notes 29 30 — (59 ) — Investments in equity affiliates — — 10 (10 ) — Business acquisitions, net (6 ) — — — (6 ) Net change in funds held for clients — — — — — Other investing activities, net 3 — — — 3 Net cash provided by (used in) investing activities (23 ) 30 (6 ) (69 ) (68 ) Financing activities Short term borrowings, net — — 7 — 7 Payments on term credit facilities (17 ) — — — (17 ) Payments on revolving credit facilities (375 ) — — — (375 ) Borrowings on revolving credit facilities 330 — 100 — 430 Proceeds from employee stock plans 4 — — — 4 Equity contribution — (10 ) — 10 — Net change in client funds obligations — — 17 — 17 Borrowings (repayments) of intercompany notes — — (59 ) 59 — Tax withholding payments on behalf of employees (13 ) — — — (13 ) Net cash provided by (used in) financing activities (71 ) (10 ) 65 69 53 Cash flows from discontinued operations Net cash used in operating activities (6 ) — — — (6 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash — — 1 — 1 Increase (decrease) in cash, cash equivalents, and restricted cash 11 — (47 ) — (36 ) Cash, cash equivalents and restricted cash at beginning of period 11 3 508 — 522 Cash, cash equivalents and restricted cash at end of period $ 22 $ 3 $ 461 $ — $ 486 In millions March 31, 2019 Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows Parent Issuer Guarantor Subsidiary Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ 21 $ 3 $ 390 $ — $ 414 Restricted cash and restricted cash equivalents including funds held for clients included in other assets 1 — 71 — 72 Total cash, cash equivalents and restricted cash $ 22 $ 3 $ 461 $ — $ 486 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies Contract Assets and Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | ||
Current portion of contract assets | $ 9 | $ 9 |
Contract with Customer, Liability, Current | 616 | 502 |
Non-current portion of contract liabilities | 75 | $ 81 |
Revenue recognized that was included in contract liabilities | 198 | |
Remaining performance obligations | $ 4,000 |
Segment Information and Conce_3
Segment Information and Concentrations - Revenue and Operating Income By Segments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | ||
Total revenue | $ 1,503 | $ 1,536 |
Income (loss) from operations | 77 | 100 |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 1,503 | 1,536 |
Segment operating income | 104 | 147 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Transformation and restructuring costs | 5 | 26 |
Acquisition-related amortization of intangible assets | 22 | 21 |
Other adjustments | 27 | 47 |
Banking | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 763 | 758 |
Segment operating income | 103 | 95 |
Retail | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 472 | 511 |
Segment operating income | 5 | 26 |
Hospitality | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 169 | 193 |
Segment operating income | (9) | 16 |
Other | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 99 | 74 |
Segment operating income | $ 5 | $ 10 |
Segment Information and Conce_4
Segment Information and Concentrations - Revenue by Geography (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | $ 1,503 | $ 1,536 |
Americas | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | 892 | 920 |
Europe, Middle East and Africa (EMEA) | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | 403 | 419 |
Asia Pacific (APJ) | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenue | $ 208 | $ 197 |
Segment Information and Conce_5
Segment Information and Concentrations - Revenue by Products and Services (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue from External Customer [Line Items] | ||
Total revenue | $ 1,503 | $ 1,536 |
Product revenue | ||
Revenue from External Customer [Line Items] | ||
Total revenue | 474 | 539 |
Professional services and installation services revenue | ||
Revenue from External Customer [Line Items] | ||
Total revenue | 227 | 238 |
Recurring revenue, including maintenance, cloud revenue and payments | ||
Revenue from External Customer [Line Items] | ||
Total revenue | 802 | 759 |
Software | ||
Revenue from External Customer [Line Items] | ||
Total revenue | 474 | 467 |
Services | ||
Revenue from External Customer [Line Items] | ||
Total revenue | 636 | 585 |
Hardware | ||
Revenue from External Customer [Line Items] | ||
Total revenue | $ 393 | $ 484 |
Goodwill and Long-Lived Asset_2
Goodwill and Long-Lived Assets - Goodwill by Segments (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Goodwill | $ 3,001 |
Accumulated Impairment Losses | (169) |
Total | 2,832 |
Additions | 3 |
Impairment | 0 |
Other | (14) |
Goodwill | 2,990 |
Accumulated Impairment Losses | (169) |
Total | 2,821 |
Banking | |
Goodwill [Roll Forward] | |
Goodwill | 1,774 |
Accumulated Impairment Losses | (101) |
Total | 1,673 |
Additions | 0 |
Impairment | 0 |
Other | (3) |
Goodwill | 1,771 |
Accumulated Impairment Losses | (101) |
Total | 1,670 |
Retail | |
Goodwill [Roll Forward] | |
Goodwill | 638 |
Accumulated Impairment Losses | (34) |
Total | 604 |
Additions | 0 |
Impairment | 0 |
Other | (9) |
Goodwill | 629 |
Accumulated Impairment Losses | (34) |
Total | 595 |
Hospitality | |
Goodwill [Roll Forward] | |
Goodwill | 402 |
Accumulated Impairment Losses | (23) |
Total | 379 |
Additions | 3 |
Impairment | 0 |
Other | (2) |
Goodwill | 403 |
Accumulated Impairment Losses | (23) |
Total | 380 |
Other | |
Goodwill [Roll Forward] | |
Goodwill | 187 |
Accumulated Impairment Losses | (11) |
Total | 176 |
Additions | 0 |
Impairment | 0 |
Other | 0 |
Goodwill | 187 |
Accumulated Impairment Losses | (11) |
Total | $ 176 |
Goodwill and Long-Lived Asset_3
Goodwill and Long-Lived Assets - Purchased Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 1,426 | $ 1,431 |
Finite-Lived Intangible Assets, Accumulated Amortization | 846 | 824 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 735 | 735 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 284 | 270 |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 1 year | |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 20 years | |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 524 | 529 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 403 | 397 |
Intellectual Property [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 2 years | |
Intellectual Property [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 8 years | |
Customer Contracts [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 8 years | |
Finite-Lived Intangible Assets, Gross | $ 89 | 89 |
Finite-Lived Intangible Assets, Accumulated Amortization | 89 | 89 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 78 | 78 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 70 | $ 68 |
Trade Names [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 1 year | |
Trade Names [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years |
Goodwill and Long-Lived Asset_4
Goodwill and Long-Lived Assets - Amortization Expense (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Amortization expense three months ended 2019 | $ 22 |
Amortization expense remainder of 2019 (estimated) | 60 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2020 | 73 |
2021 | 68 |
2022 | 66 |
2023 | 59 |
2024 | $ 51 |
Debt Obligations - Short-term B
Debt Obligations - Short-term Borrowings and Long-term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 304 | $ 282 |
Long-term debt | 4,081 | 3,277 |
Unamortized Debt Issuance Expense | (31) | (32) |
Term loan facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 739 | $ 740 |
Weighted-average interest rate on long-term debt | 4.30% | 4.30% |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 1,070 | $ 265 |
Weighted-average interest rate on long-term debt | 3.77% | 3.76% |
5.00% Senior Notes due 2022 | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 600 | $ 600 |
Debt stated interest rate | 5.00% | 5.00% |
6.375% Senior Notes due 2023 | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 700 | $ 700 |
Debt stated interest rate | 6.375% | 6.375% |
5.750% Senior Notes due 2027 [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 500 | $ 500 |
Debt stated interest rate | 5.75% | |
Other | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 3 | $ 4 |
Weighted-average interest rate on long-term debt | 0.00% | 0.05% |
6.125% Senior Notes due 2029 [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 500 | $ 500 |
Debt stated interest rate | 6.125% | |
Term loan facility | ||
Debt Instrument [Line Items] | ||
Current portion of Senior Secured Credit Facility | $ 7 | $ 8 |
Weighted-Average interest rate on short-term borrowings | 4.30% | 4.30% |
Trade Receivables Securitization Facility | ||
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 293 | $ 270 |
Weighted-Average interest rate on short-term borrowings | 2.65% | 2.65% |
Other | ||
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 4 | $ 4 |
Weighted-Average interest rate on short-term borrowings | 4.25% | 2.82% |
Debt Obligations - Senior Secur
Debt Obligations - Senior Secured Credit Facility (Details) | 3 Months Ended | |
Mar. 31, 2020USD ($)Rate | Dec. 31, 2019USD ($) | |
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 304,000,000 | $ 282,000,000 |
Quarterly Payment of Term Loan Principal Amount | 0.25% | |
Long-term debt | $ 4,081,000,000 | 3,277,000,000 |
Letters of credit outstanding | $ 28,000,000 | |
Increase in Maximum Permitted Leverage Ratio due to Material Acquisitions | 0.25 | |
Available additional amount of incremental term loan commitment | $ 150,000,000 | |
Period One | ||
Debt Instrument [Line Items] | ||
Debt consolidated leverage ratio | 4.25 | |
Debt maximum spread on consolidated leverage ratio | 0.50 | |
Period Two | ||
Debt Instrument [Line Items] | ||
Debt consolidated leverage ratio | 1 | |
Period Three | ||
Debt Instrument [Line Items] | ||
Debt consolidated leverage ratio | 4 | |
Debt maximum spread on consolidated leverage ratio | 0.50 | |
Period Four | ||
Debt Instrument [Line Items] | ||
Debt consolidated leverage ratio | 1 | |
Period Five | ||
Debt Instrument [Line Items] | ||
Debt consolidated leverage ratio | 4.50 | |
Term loan facility | Base Rate | ||
Debt Instrument [Line Items] | ||
Debt basis spread on variable rate | 1.50% | |
Term loan facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Debt basis spread on variable rate | Rate | 2.50% | |
Secured Debt | ||
Debt Instrument [Line Items] | ||
Debt Instrument Covenant Interest Coverage Ratio | 4.75 | |
Debt maximum consolidated leverage ratio | 4.75 | |
Secured Debt | Federal Funds Rate | ||
Debt Instrument [Line Items] | ||
Debt basis spread on variable rate | 0.50% | |
Secured Debt | Base Rate | ||
Debt Instrument [Line Items] | ||
Debt basis spread on variable rate | 1.00% | |
Secured Debt | LIBOR | Minimum | ||
Debt Instrument [Line Items] | ||
Debt margin for base rate loans | 1.25% | |
Secured Debt | LIBOR | Maximum | ||
Debt Instrument [Line Items] | ||
Debt margin for base rate loans | 2.25% | |
Secured Debt | EURIBOR | Minimum | ||
Debt Instrument [Line Items] | ||
Debt margin for base rate loans | 0.25% | |
Secured Debt | EURIBOR | Maximum | ||
Debt Instrument [Line Items] | ||
Debt margin for base rate loans | 1.25% | |
Revolving [Member] | Secured Debt | ||
Debt Instrument [Line Items] | ||
Secured revolving credit facility principal amount | $ 1,100,000,000 | |
Term loan facility | ||
Debt Instrument [Line Items] | ||
Total Term Loan Balance Outstanding | 746,000,000 | |
Long-term debt | 739,000,000 | 740,000,000 |
Term loan facility | Secured Debt | ||
Debt Instrument [Line Items] | ||
Secured revolving credit facility principal amount | 750,000,000 | |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | 1,070,000,000 | $ 265,000,000 |
Revolving Foreign | Secured Debt | ||
Debt Instrument [Line Items] | ||
Secured revolving credit facility principal amount | $ 400,000,000 | |
Secured Debt | Federal Funds Rate | ||
Debt Instrument [Line Items] | ||
Debt basis spread on variable rate | 0.50% |
Debt Obligations - Senior Unsec
Debt Obligations - Senior Unsecured Notes (Details) - USD ($) $ in Millions | Apr. 13, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Aug. 21, 2019 | Dec. 19, 2013 | Sep. 17, 2012 |
5.00% Senior Notes due 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | $ 600 | |||||
Debt stated interest rate | 5.00% | 5.00% | ||||
Debt percentage of principle amount notes were sold at | 100.00% | |||||
6.375% Senior Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | $ 700 | |||||
Debt stated interest rate | 6.375% | 6.375% | ||||
Debt percentage of principle amount notes were sold at | 100.00% | |||||
5.750% Senior Notes due 2027 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | $ 500 | |||||
Debt stated interest rate | 5.75% | |||||
Debt percentage of principle amount notes were sold at | 100.00% | |||||
6.125% Senior Notes due 2029 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | $ 500 | |||||
Debt stated interest rate | 6.125% | |||||
Subsequent Event [Member] | 8.125% Notes Due 2025 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Debt | $ 400 | |||||
Debt Instrument Redemption Price As Percentage of Principle Amount | 100.00% | |||||
Debt percentage of principle amount notes were sold at | 100.00% | |||||
NCR International, Inc. [Member] | Guarantor Subsidiary | 5.00% Senior Notes due 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Debt stated interest rate | 5.00% | |||||
NCR International, Inc. [Member] | Guarantor Subsidiary | 6.375% Senior Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Debt stated interest rate | 6.375% | |||||
NCR International, Inc. [Member] | Guarantor Subsidiary | Subsequent Event [Member] | 8.125% Notes Due 2025 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt stated interest rate | 8.125% |
Debt Obligations - Trade Receiv
Debt Obligations - Trade Receivables Securitization Facility (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Trade receivables securitization facility, maximum borrowing base | $ 300 | |
Short-term borrowings | 304 | $ 282 |
Trade receivables securitization facility, collateral at period end | $ 548 | 603 |
Federal Funds Rate | Secured Debt | ||
Debt Instrument [Line Items] | ||
Debt basis spread on variable rate | 0.50% | |
Trade Receivables Securitization Facility | ||
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 293 | $ 270 |
Debt Obligations - Fair Value o
Debt Obligations - Fair Value of Debt (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
Debt value of long-term debt | $ 4,220 | $ 3,700 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Contingency [Line Items] | ||
Income tax expense (benefit) | $ 1 | $ 9 |
Minimum | ||
Income Tax Contingency [Line Items] | ||
Reasonable possible decrease in unrecognized tax benefits | 30 | |
Maximum | ||
Income Tax Contingency [Line Items] | ||
Reasonable possible decrease in unrecognized tax benefits | 37 | |
Out of period adjustments - stock compensation permanent differences [Member] | ||
Income Tax Contingency [Line Items] | ||
Income tax expense (benefit) | 2 | |
Out of period adjustments - write-off of income tax payables [Member] | ||
Income Tax Contingency [Line Items] | ||
Income tax expense (benefit) | $ 3 |
Stock Compensation Plans - Stoc
Stock Compensation Plans - Stock-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock units | $ 19 | $ 20 |
Stock options | 4 | 2 |
Employee stock purchase plan | 2 | 1 |
Stock-based compensation expense | 25 | 23 |
Tax benefit | (3) | (3) |
Stock-based compensation expense (net of tax) | $ 22 | $ 20 |
Stock Compensation Plans - Narr
Stock Compensation Plans - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Payment Arrangement, Option, Exercise Price Range, Exercisable, Weighted Average Exercise Price | $ 38.26 | |
Share Based Compensation, Stock Options Award Exercise Price Premium Percentage | 115.00% | |
Weighted average grant date fair value of stock options (in dollars per share) | $ 7.85 | $ 8.07 |
Contractual term of stock options granted | 7 years | 7 years |
Risk-free interest rate period of U.S. Treasury yield | 7 years | |
Unrecognized compensation cost related to unvested awards | $ 63 | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate period of U.S. Treasury yield | 3 years | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate period of U.S. Treasury yield | 5 years | |
ESPP | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Discount stock purchase price percentage | 15.00% | |
Look-back feature period of discount stock purchase price | 3 months | |
Minimum contribution by participant percentage | 1.00% | |
Maximum contribution by participant percentage | 10.00% | |
Stocks purchased by employees during the period (in shares) | 0.5 | 0.3 |
Discounted price per share of stocks purchased by employees (in dollar per share) | $ 15.05 | $ 20.24 |
Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period of stock options grated | 3 years | 4 years |
Weighted average period to recognized compensation cost related to unvested awards | 1 year 4 months 24 days | |
Restricted Stock Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost related to unvested awards | $ 118 | |
Weighted average period to recognized compensation cost related to unvested awards | 1 year 1 month 6 days |
Stock Compensation Plans - Valu
Stock Compensation Plans - Valuation Assumptions Used for Stock Options (Details) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Dividend yield | 0.00% | 0.00% |
Risk-free interest rate | 1.46% | 2.50% |
Expected volatility | 33.38% | 34.79% |
Expected holding period (years) | 3 years 8 months 12 days | 3 years 10 months 24 days |
Employee Benefit Plans - Pensio
Employee Benefit Plans - Pension Plan (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
U.S. Pension Benefits | ||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||
Net service cost | $ 0 | $ 0 |
Interest cost | 13 | 16 |
Expected return on plan assets | (9) | (10) |
Net periodic benefit cost (income) | 4 | 6 |
International Pension Benefits | ||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||
Net service cost | 1 | 2 |
Interest cost | 4 | 5 |
Expected return on plan assets | (7) | (8) |
Net periodic benefit cost (income) | (2) | (1) |
Total Pension Benefits | ||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||
Net service cost | 1 | 2 |
Interest cost | 17 | 21 |
Expected return on plan assets | (16) | (18) |
Net periodic benefit cost (income) | $ 2 | $ 5 |
Employee Benefit Plans - Postre
Employee Benefit Plans - Postretirement Plan (Details) - Postretirement Plan - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | $ 0 | $ 0 |
Amortization of prior service benefit | (1) | (1) |
Net periodic benefit cost (income) | $ (1) | $ (1) |
Employee Benefit Plans - Postem
Employee Benefit Plans - Postemployment Plan (Details) - Postemployment Retirement Benefits [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Net service cost | $ 6 | $ 14 |
Interest cost | 0 | 1 |
Amortization of prior service benefit | 0 | (1) |
Amortization of actuarial gain | (1) | (1) |
Net benefit cost | $ 5 | $ 13 |
Employee Benefit Plans - Narrat
Employee Benefit Plans - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Pension | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Plan assets contributions by employer | $ 5 |
Additional estimated contributions by employer during fiscal year | 16 |
Total estimated contributions by employer during fiscal year | 21 |
Postretirement Plan | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Plan assets contributions by employer | 0 |
Additional estimated contributions by employer during fiscal year | 2 |
Total estimated contributions by employer during fiscal year | 2 |
Postemployment Retirement Benefits [Member] | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Plan assets contributions by employer | 4 |
Additional estimated contributions by employer during fiscal year | 46 |
Total estimated contributions by employer during fiscal year | $ 50 |
Commitments and Contingencies -
Commitments and Contingencies - Loss Contingencies (Details) $ in Millions | Mar. 29, 2018USD ($)company | Mar. 31, 2020USD ($)defendantaffiliate_corporationsfacilitynumber_of_companiesentityparty | Dec. 31, 2019USD ($) | Aug. 22, 2017party | Dec. 31, 2013company | Nov. 13, 2007entity |
Loss Contingencies [Line Items] | ||||||
Inventory, Net | $ 747 | $ 784 | ||||
Ebina [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency accrual | $ 20 | 19 | ||||
Fox River | ||||||
Loss Contingencies [Line Items] | ||||||
Number of potentially responsible parties | entity | 8 | 8 | ||||
Number of previously owned carbonless copy paper manufacturing facilities | facility | 2 | |||||
Threshold amount for environmental cleanup costs | 75 | |||||
Percentage of funding obligation under cost sharing agreement | 50.00% | |||||
Percentage of obligation under cost sharing agreement | 60.00% | |||||
Receivable under funding agreement | $ 53 | 53 | ||||
Number of defendants | defendant | 2 | |||||
Number of parties | party | 2 | |||||
Gross loss contingency accrual | $ 3 | 5 | ||||
Net loss contingency accrual | $ 21 | 16 | ||||
Total amount received from settlements with insurance carriers | 202 | |||||
Kalamazoo River | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, value of damages sought | $ 105 | |||||
Number of additional companies receiving general notice letters | number_of_companies | 3 | |||||
Number of additional defendants | defendant | 2 | |||||
Number of total corporation plaintiffs | affiliate_corporations | 3 | |||||
Number of companies tried to the court | company | 4 | |||||
Costs incurred in the pasted related to loss contingency | 50 | |||||
Loss contingency, value of damages sought | $ 55 | |||||
NCR share of costs related to loss contingency | 40.00% | |||||
GP share of costs related to loss contingency | 40.00% | |||||
Number of companies assigned to share costs of loss contingency | company | 2 | |||||
Loss contingency accrual | $ 81 | 81 | ||||
Fox River LLC | Fox River | ||||||
Loss Contingencies [Line Items] | ||||||
Funding remainder | 0 | |||||
Glatfelter | Fox River | ||||||
Loss Contingencies [Line Items] | ||||||
Number of parties that appealed | party | 1 | |||||
Company One | Kalamazoo River | ||||||
Loss Contingencies [Line Items] | ||||||
NCR share of costs related to loss contingency | 15.00% | |||||
Company Two | Kalamazoo River | ||||||
Loss Contingencies [Line Items] | ||||||
NCR share of costs related to loss contingency | 5.00% | |||||
Fox River | ||||||
Loss Contingencies [Line Items] | ||||||
Percentage of portion of costs below threshold | 45.00% | |||||
Percentage of portion of costs exceeding threshold | 40.00% | |||||
Fox River | General Contractor Arbitration [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, range of possible loss | 10 | |||||
Minimum | Fox River | General Contractor Arbitration [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, range of possible loss | 46 | |||||
Percentage of Company's award responsibility to indemnitors and co-obligators | 25.00% | |||||
Maximum | Fox River | General Contractor Arbitration [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, range of possible loss | $ 53 | |||||
BCG Matter [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, value of damages sought | $ 80 | |||||
Nashville Tornado [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Inventory, Net | 151 | |||||
Inventory Write-down | 105 | |||||
Inventory Requiring Further Assessment for Write-down | 46 | |||||
Insurance Recoveries | 25 | |||||
Insurance Recoveries Received After Period End | $ 40 |
Commitments and Contingencies_2
Commitments and Contingencies - Warranty Reserve (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance as of January 1 | $ 21 | $ 26 |
Accruals for warranties issued | 8 | 8 |
Settlements (in cash or in kind) | (11) | (10) |
Ending balance as of March 31 | $ 18 | $ 24 |
Leasing - Lease Balances (Detai
Leasing - Lease Balances (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Operating lease assets | $ 362 | $ 391 |
Finance lease assets | 47 | 38 |
Accumulated Amortization of Finance lease assets | (8) | (5) |
Total leased assets | 401 | 424 |
Liabilities | ||
Operating lease liabilities, current | 88 | 91 |
Finance lease liabilities, current | 13 | 10 |
Operating lease liabilities, noncurrent | 346 | 369 |
Finance lease liabilities, noncurrent | 28 | 25 |
Total lease liabilities | $ 475 | $ 495 |
Leasing - Lease Costs (Details)
Leasing - Lease Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 32 | $ 35 |
Finance lease cost | ||
Amortization of leased assets | 3 | 0 |
Interest on lease liabilities | 0 | 0 |
Short-Term lease cost | 1 | 2 |
Variable lease cost | 7 | 9 |
Total lease cost | $ 43 | $ 46 |
Leasing - Supplemental Cash Flo
Leasing - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 30 | $ 32 |
Operating cash flows from finance leases | 0 | 0 |
Financing cash flows from finance leases | 3 | 0 |
Lease Assets Obtained in Exchange for Lease Obligations | ||
Operating Leases | (2) | 12 |
Finance Leases | $ 8 | $ 1 |
Leasing - Present Value of Leas
Leasing - Present Value of Lease Liabilities (Details) $ in Millions | Mar. 31, 2020USD ($) |
Operating Leases | |
Remainder of 2020 | $ 88 |
2021 | 86 |
2022 | 64 |
2023 | 44 |
2024 | 38 |
Thereafter | 272 |
Total lease payments | 592 |
Less: Amount representing interest | (158) |
Present value of lease liabilities | 434 |
Finance Leases | |
Remainder of 2020 | 10 |
2021 | 14 |
2022 | 13 |
2023 | 6 |
2024 | 0 |
Thereafter | 0 |
Total lease payments | 43 |
Less: Amount representing interest | (2) |
Present value of lease liabilities | $ 41 |
Leasing - Narrative (Details)
Leasing - Narrative (Details) - Europe $ in Millions | Mar. 31, 2020USD ($) |
Lessee, Lease, Description [Line Items] | |
Amount of additional operating leases not yet commenced | $ 73 |
Term of additional operating leases not yet commenced | 10 years |
Leasing - Weighted Average Rema
Leasing - Weighted Average Remaining Lease Term and Interest Rate (Details) | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Weighted average lease term, operating leases | 9 years 1 month 6 days | 8 years 10 months 24 days |
Weighted average lease term, finance leases | 3 years 2 months 12 days | 3 years 4 months 24 days |
Weighted average interest rate, operating leases | 6.39% | 6.42% |
Weighted average interest rate, finance leases | 4.15% | 3.72% |
Series A Convertible Preferre_2
Series A Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Sep. 18, 2019 | Mar. 17, 2017 | Dec. 04, 2015 | |
Class of Stock [Line Items] | ||||||
Series A convertible preferred stock, issued (in shares) | 400,000 | 400,000 | ||||
Secondary offering by the preferred shareholders | 342,000 | |||||
Redeemed Shares of Preferred Stock | 90,000 | |||||
Repurchase price per share of common stock upon conversion | $ 48.47 | |||||
Series A Convertible Preferred Stock | ||||||
Class of Stock [Line Items] | ||||||
Series A convertible preferred stock, issued (in shares) | 820,000 | |||||
Aggregate purchase price of preferred shares | $ 820 | |||||
Preferred stock, par value (in dollars per share) | $ 1,000 | |||||
Direct issuance expenses | $ 26 | |||||
Dividend rate | 5.50% | |||||
Conversion price per share at option of holder (in dollars per share) | $ 30 | |||||
Conversion rate per preferred share (in shares) | 33.333 | |||||
Redeemed Shares of Preferred Stock | 512,221 | |||||
Blackstone Shares Converted into Common Shares | 237,673 | |||||
Cash Paid for the Redemption of Preferred Stock | $ 302 | |||||
Preferred Shares Converted into Common Stock in Redemption | 9,160,000 | |||||
Dividends, Preferred Stock, Cash | $ 6 | |||||
Dividends, preferred stock, paid-in-kind | $ 12 | |||||
Financial instruments subject to redemption, settlement terms, maximum number of shares (in shares) | 13,200,000 | 13,300,000 |
Earnings Per Share - Basic Earn
Earnings Per Share - Basic Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Numerator: | ||
Income (loss) from continuing operations | $ 23 | $ 37 |
Preferred Stock Dividends Income Statement Impact Included in Diluted Earnings Per Share From Continuing Operations | 6 | 13 |
Dividends on convertible preferred stock | (6) | (13) |
Income from continuing operations attributable to NCR common stockholders | 17 | 24 |
Loss from discontinued operations, net of tax | 0 | 0 |
Net income (loss) attributable to NCR common stockholders | $ 17 | $ 24 |
Denominator: | ||
Weighted average outstanding shares of common stock (in shares) | 128 | 119.3 |
Basic earnings per share: | ||
From continuing operations (in dollars per share) | $ 0.13 | $ 0.20 |
From discontinued operations (in dollars per share) | 0 | 0 |
Total basic earnings (loss) per share (in dollars per share) | $ 0.13 | $ 0.20 |
Earnings Per Share - Diluted Ea
Earnings Per Share - Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Numerator: | ||
Income (loss) from continuing operations | $ 23 | $ 37 |
Preferred Stock Dividends Income Statement Impact Included in Diluted Earnings Per Share From Continuing Operations | 6 | 13 |
Preferred Stock Dividends, Income Statement Impact | 6 | 13 |
Income from continuing operations attributable to NCR common stockholders | 17 | 24 |
Loss from discontinued operations, net of tax | 0 | 0 |
Net income attributable to NCR common stockholders | $ 17 | $ 24 |
Weighted average outstanding shares of common stock (in shares) | 128 | 119.3 |
Dilutive effect of restricted stock units (in shares) | 2.5 | 2.9 |
Denominator (in shares) | 130.5 | 122.2 |
Diluted earnings per share: | ||
From continuing operations (in dollars per share) | $ 0.13 | $ 0.20 |
From discontinued operations (in dollars per share) | 0 | 0 |
Total diluted earnings (loss) per share (in dollars per share) | $ 0.13 | $ 0.20 |
Series A Convertible Preferred Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from diluted per share count (in shares) | 13.2 | 29.2 |
Restricted Stock Units (RSUs) and Stock Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from diluted per share count (in shares) | 7.8 | 4.5 |
Derivatives and Hedging Instr_3
Derivatives and Hedging Instruments - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)currency | |
Derivative [Line Items] | |
Number of functional currencies | currency | 50 |
Maximum period for cash flow hedging activity | 15 months |
Foreign exchange contracts | |
Derivative [Line Items] | |
Gain in AOCI related to foreign exchange derivative transactions, net of tax | $ | $ 2 |
Derivatives and Hedging Instr_4
Derivatives and Hedging Instruments - Derivative Fair Values (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Fair Value | $ 6 | $ 2 |
Derivative Liabilities, Fair Value | 6 | 1 |
Derivatives designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Fair Value | 5 | 1 |
Derivative Liabilities, Fair Value | 2 | 0 |
Derivatives designated as hedging instruments | Foreign exchange contracts | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Notional Amount | 155 | 55 |
Derivative Assets, Fair Value | 5 | 1 |
Derivatives designated as hedging instruments | Foreign exchange contracts | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability, Notional Amount | 79 | |
Derivative Liabilities, Fair Value | 2 | 0 |
Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Fair Value | 1 | 1 |
Derivative Liabilities, Fair Value | 4 | 1 |
Derivatives not designated as hedging instruments | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Fair Value | 1 | |
Derivatives not designated as hedging instruments | Foreign exchange contracts | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Notional Amount | 175 | 71 |
Derivative Assets, Fair Value | 1 | |
Derivatives not designated as hedging instruments | Foreign exchange contracts | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability, Notional Amount | 319 | 264 |
Derivative Liabilities, Fair Value | $ 4 | $ 1 |
Derivatives and Hedging Instr_5
Derivatives and Hedging Instruments - Gain (Loss) on Derivatives (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Other Comprehensive Income (OCI) on Derivative | $ 3 | $ 1 |
Foreign exchange contracts | Cash Flow Hedging | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Other Comprehensive Income (OCI) on Derivative | 3 | 1 |
Foreign exchange contracts | Cash Flow Hedging | Cost of products | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain (Loss) Recognized in Other Comprehensive Income (OCI) on Derivative | $ (1) | $ (1) |
Derivatives and Hedging Instr_6
Derivatives and Hedging Instruments - Gain (Loss) on Derivatives Not Designated as Hedging Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Foreign exchange contracts | Other (expense), net | ||
Derivative [Line Items] | ||
Amount of Gain (Loss) Recognized in the Condensed Consolidated Statement of Operations | $ 6 | $ (5) |
Fair Value of Assets and Liab_3
Fair Value of Assets and Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Asset Impairment Charges | $ 0 | $ 0 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and Cash Equivalents, Fair Value Disclosure | 937 | $ 15 | |
Foreign Currency Contract, Asset, Fair Value Disclosure | 0 | 0 | |
Assets, Fair Value Disclosure | 937 | 15 | |
Foreign Currency Contracts, Liability, Fair Value Disclosure | 0 | 0 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 0 | 0 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and Cash Equivalents, Fair Value Disclosure | 0 | 0 | |
Foreign Currency Contract, Asset, Fair Value Disclosure | 6 | 2 | |
Assets, Fair Value Disclosure | 6 | 2 | |
Foreign Currency Contracts, Liability, Fair Value Disclosure | 6 | 1 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 6 | 1 | |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and Cash Equivalents, Fair Value Disclosure | 0 | 0 | |
Foreign Currency Contract, Asset, Fair Value Disclosure | 0 | 0 | |
Assets, Fair Value Disclosure | 0 | 0 | |
Foreign Currency Contracts, Liability, Fair Value Disclosure | 0 | 0 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | 0 | 0 | |
Fair Value, Recurring [Member] | Estimate of Fair Value Measurement [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and Cash Equivalents, Fair Value Disclosure | 937 | 15 | |
Foreign Currency Contract, Asset, Fair Value Disclosure | 6 | 2 | |
Assets, Fair Value Disclosure | 943 | 17 | |
Foreign Currency Contracts, Liability, Fair Value Disclosure | 6 | 1 | |
Financial and Nonfinancial Liabilities, Fair Value Disclosure | $ 6 | $ 1 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (AOCI) - Changes in AOCI by Component (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Balance as of December 31, 2019 | $ (269) |
Other comprehensive income (loss) before reclassifications | (58) |
Amounts reclassified from AOCI | (2) |
Net current period other comprehensive (loss) income | (60) |
Balance as of March 31, 2020 | (329) |
Currency Translation Adjustments | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Balance as of December 31, 2019 | (260) |
Other comprehensive income (loss) before reclassifications | (60) |
Amounts reclassified from AOCI | 0 |
Net current period other comprehensive (loss) income | (60) |
Balance as of March 31, 2020 | (320) |
Changes in Employee Benefit Plans | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Balance as of December 31, 2019 | (10) |
Other comprehensive income (loss) before reclassifications | 0 |
Amounts reclassified from AOCI | (1) |
Net current period other comprehensive (loss) income | (1) |
Balance as of March 31, 2020 | (11) |
Changes in Fair Value of Effective Cash Flow Hedges | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Balance as of December 31, 2019 | 1 |
Other comprehensive income (loss) before reclassifications | 2 |
Amounts reclassified from AOCI | (1) |
Net current period other comprehensive (loss) income | 1 |
Balance as of March 31, 2020 | $ 2 |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) (AOCI) - Reclassifications Out of AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Selling, General and Administrative Expense | $ (255) | $ (252) |
Research and development expenses | (65) | (59) |
Income (loss) from continuing operations | 24 | 38 |
Income tax expense | (1) | (9) |
Net income (loss) attributable to NCR common stockholders | 17 | 24 |
Product | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (391) | (453) |
Service [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (715) | (672) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income (loss) from continuing operations | (3) | (4) |
Income tax expense | 1 | 0 |
Net income (loss) attributable to NCR common stockholders | (2) | (4) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Product | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (1) | (1) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Service [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (2) | (3) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Effective Cash Flow Hedge Loss (Gain) | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income (loss) from continuing operations | (1) | (1) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Effective Cash Flow Hedge Loss (Gain) | Product | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | 0 | 0 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Effective Cash Flow Hedge Loss (Gain) | Service [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (1) | (1) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Amortization of Prior Service Benefit | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income (loss) from continuing operations | (1) | (2) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Amortization of Prior Service Benefit | Product | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | 0 | 0 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Amortization of Prior Service Benefit | Service [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (1) | (2) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes in Fair Value of Effective Cash Flow Hedges | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Income (loss) from continuing operations | (1) | (1) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes in Fair Value of Effective Cash Flow Hedges | Product | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | (1) | (1) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes in Fair Value of Effective Cash Flow Hedges | Service [Member] | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Cost of revenue | $ 0 | $ 0 |
Supplemental Financial Inform_3
Supplemental Financial Information - Components of Accounts Receivable (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | ||
Accounts receivable, gross | $ 1,403 | $ 1,534 |
Less: allowance for credit losses | (50) | (44) |
Total accounts receivable, net | 1,353 | 1,490 |
Trade | ||
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | ||
Accounts receivable, gross | 1,359 | 1,482 |
Other | ||
Accounts Receivable, after Allowance for Credit Loss, Current [Abstract] | ||
Accounts receivable, gross | $ 44 | $ 52 |
Supplemental Financial Inform_4
Supplemental Financial Information - Components of Inventory (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory, Net [Abstract] | ||
Work in process and raw materials | $ 190 | $ 204 |
Finished goods | 183 | 184 |
Service parts | 374 | 396 |
Total inventories | $ 747 | $ 784 |
Condensed Consolidating Suppl_3
Condensed Consolidating Supplemental Guarantor Information - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
5.00% Notes | ||
Condensed Financial Statements, Captions [Line Items] | ||
Debt stated interest rate | 5.00% | 5.00% |
6.375% Notes | ||
Condensed Financial Statements, Captions [Line Items] | ||
Debt stated interest rate | 6.375% | 6.375% |
Guarantor Subsidiary | NCR International, Inc. | ||
Condensed Financial Statements, Captions [Line Items] | ||
Ownership percentage on guarantor subsidiary | 100.00% | |
Guarantor Subsidiary | NCR International, Inc. | 5.00% Notes | ||
Condensed Financial Statements, Captions [Line Items] | ||
Debt stated interest rate | 5.00% | |
Guarantor Subsidiary | NCR International, Inc. | 6.375% Notes | ||
Condensed Financial Statements, Captions [Line Items] | ||
Debt stated interest rate | 6.375% |
Condensed Consolidating Suppl_4
Condensed Consolidating Supplemental Guarantor Information - Statements of Operations and Comprehensive Income (Loss) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total revenue | $ 1,503,000,000 | $ 1,536,000,000 |
Selling, general and administrative expenses | 255,000,000 | 252,000,000 |
Research and development expenses | 65,000,000 | 59,000,000 |
Total operating expenses | 1,426,000,000 | 1,436,000,000 |
Income (loss) from operations | 77,000,000 | 100,000,000 |
Interest expense | (50,000,000) | (45,000,000) |
Other expense, net | (2,000,000) | (8,000,000) |
Income (loss) from continuing operations before income taxes | 25,000,000 | 47,000,000 |
Income tax expense (benefit) | 1,000,000 | 9,000,000 |
Income (loss) from continuing operations before earnings in subsidiaries | 24,000,000 | 38,000,000 |
Equity in earnings of consolidated subsidiaries | 0 | 0 |
Income (loss) from continuing operations | 24,000,000 | 38,000,000 |
Income (loss) from discontinued operations, net of tax | 0 | 0 |
Net income (loss) | 24,000,000 | 38,000,000 |
Net income (loss) attributable to noncontrolling interests | 1,000,000 | 1,000,000 |
Net income (loss) attributable to NCR | 23,000,000 | 37,000,000 |
Total comprehensive income (loss) | (37,000,000) | 54,000,000 |
Less comprehensive income (loss) attributable to noncontrolling interests | 0 | 1,000,000 |
Comprehensive income (loss) attributable to NCR | (37,000,000) | 53,000,000 |
Product | ||
Total revenue | 474,000,000 | 539,000,000 |
Cost of revenue | 391,000,000 | 453,000,000 |
Services | ||
Total revenue | 1,029,000,000 | 997,000,000 |
Cost of revenue | 715,000,000 | 672,000,000 |
Eliminations | ||
Total revenue | (51,000,000) | (46,000,000) |
Selling, general and administrative expenses | 0 | 0 |
Research and development expenses | 0 | 0 |
Total operating expenses | (51,000,000) | (46,000,000) |
Income (loss) from operations | 0 | 0 |
Interest expense | (1,000,000) | 3,000,000 |
Other expense, net | (1,000,000) | (3,000,000) |
Income (loss) from continuing operations before income taxes | 0 | 0 |
Income tax expense (benefit) | 0 | 0 |
Income (loss) from continuing operations before earnings in subsidiaries | 0 | 0 |
Equity in earnings of consolidated subsidiaries | (150,000,000) | (225,000,000) |
Income (loss) from continuing operations | (150,000,000) | (225,000,000) |
Income (loss) from discontinued operations, net of tax | 0 | 0 |
Net income (loss) | (150,000,000) | (225,000,000) |
Net income (loss) attributable to noncontrolling interests | 0 | 0 |
Net income (loss) attributable to NCR | (150,000,000) | (225,000,000) |
Total comprehensive income (loss) | (30,000,000) | (257,000,000) |
Less comprehensive income (loss) attributable to noncontrolling interests | 0 | 0 |
Comprehensive income (loss) attributable to NCR | (30,000,000) | (257,000,000) |
Eliminations | Product | ||
Total revenue | (51,000,000) | (46,000,000) |
Cost of revenue | (51,000,000) | (46,000,000) |
Eliminations | Services | ||
Total revenue | 0 | 0 |
Cost of revenue | 0 | 0 |
Parent Issuer | ||
Total revenue | 758,000,000 | 796,000,000 |
Selling, general and administrative expenses | 176,000,000 | 140,000,000 |
Research and development expenses | 33,000,000 | 33,000,000 |
Total operating expenses | 775,000,000 | 782,000,000 |
Income (loss) from operations | (17,000,000) | 14,000,000 |
Interest expense | (48,000,000) | (43,000,000) |
Other expense, net | 5,000,000 | (13,000,000) |
Income (loss) from continuing operations before income taxes | (60,000,000) | (42,000,000) |
Income tax expense (benefit) | (7,000,000) | 49,000,000 |
Income (loss) from continuing operations before earnings in subsidiaries | (53,000,000) | (91,000,000) |
Equity in earnings of consolidated subsidiaries | 76,000,000 | 128,000,000 |
Income (loss) from continuing operations | 23,000,000 | 37,000,000 |
Income (loss) from discontinued operations, net of tax | 0 | 0 |
Net income (loss) | 23,000,000 | 37,000,000 |
Net income (loss) attributable to noncontrolling interests | 0 | 0 |
Net income (loss) attributable to NCR | 23,000,000 | 37,000,000 |
Total comprehensive income (loss) | (37,000,000) | 53,000,000 |
Less comprehensive income (loss) attributable to noncontrolling interests | 0 | 0 |
Comprehensive income (loss) attributable to NCR | (37,000,000) | 53,000,000 |
Parent Issuer | Product | ||
Total revenue | 211,000,000 | 273,000,000 |
Cost of revenue | 177,000,000 | 246,000,000 |
Parent Issuer | Services | ||
Total revenue | 547,000,000 | 523,000,000 |
Cost of revenue | 389,000,000 | 363,000,000 |
Guarantor Subsidiary | ||
Total revenue | 2,000,000 | 4,000,000 |
Selling, general and administrative expenses | 0 | 0 |
Research and development expenses | 0 | 0 |
Total operating expenses | 1,000,000 | 1,000,000 |
Income (loss) from operations | 1,000,000 | 3,000,000 |
Interest expense | 0 | 0 |
Other expense, net | 0 | 2,000,000 |
Income (loss) from continuing operations before income taxes | 1,000,000 | 5,000,000 |
Income tax expense (benefit) | 1,000,000 | (1,000,000) |
Income (loss) from continuing operations before earnings in subsidiaries | 0 | 6,000,000 |
Equity in earnings of consolidated subsidiaries | 74,000,000 | 97,000,000 |
Income (loss) from continuing operations | 74,000,000 | 103,000,000 |
Income (loss) from discontinued operations, net of tax | 0 | 0 |
Net income (loss) | 74,000,000 | 103,000,000 |
Net income (loss) attributable to noncontrolling interests | 0 | 0 |
Net income (loss) attributable to NCR | 74,000,000 | 103,000,000 |
Total comprehensive income (loss) | 15,000,000 | 120,000,000 |
Less comprehensive income (loss) attributable to noncontrolling interests | 0 | 0 |
Comprehensive income (loss) attributable to NCR | 15,000,000 | 120,000,000 |
Guarantor Subsidiary | Product | ||
Total revenue | 1,000,000 | 2,000,000 |
Cost of revenue | 0 | 0 |
Guarantor Subsidiary | Services | ||
Total revenue | 1,000,000 | 2,000,000 |
Cost of revenue | 1,000,000 | 1,000,000 |
Non-Guarantor Subsidiaries | ||
Total revenue | 794,000,000 | 782,000,000 |
Selling, general and administrative expenses | 79,000,000 | 112,000,000 |
Research and development expenses | 32,000,000 | 26,000,000 |
Total operating expenses | 701,000,000 | 699,000,000 |
Income (loss) from operations | 93,000,000 | 83,000,000 |
Interest expense | (3,000,000) | (5,000,000) |
Other expense, net | (6,000,000) | 6,000,000 |
Income (loss) from continuing operations before income taxes | 84,000,000 | 84,000,000 |
Income tax expense (benefit) | 7,000,000 | (39,000,000) |
Income (loss) from continuing operations before earnings in subsidiaries | 77,000,000 | 123,000,000 |
Equity in earnings of consolidated subsidiaries | 0 | 0 |
Income (loss) from continuing operations | 77,000,000 | 123,000,000 |
Income (loss) from discontinued operations, net of tax | 0 | 0 |
Net income (loss) | 77,000,000 | 123,000,000 |
Net income (loss) attributable to noncontrolling interests | 1,000,000 | 1,000,000 |
Net income (loss) attributable to NCR | 76,000,000 | 122,000,000 |
Total comprehensive income (loss) | 15,000,000 | 138,000,000 |
Less comprehensive income (loss) attributable to noncontrolling interests | 0 | 1,000,000 |
Comprehensive income (loss) attributable to NCR | 15,000,000 | 137,000,000 |
Non-Guarantor Subsidiaries | Product | ||
Total revenue | 313,000,000 | 310,000,000 |
Cost of revenue | 265,000,000 | 253,000,000 |
Non-Guarantor Subsidiaries | Services | ||
Total revenue | 481,000,000 | 472,000,000 |
Cost of revenue | $ 325,000,000 | $ 308,000,000 |
Condensed Consolidating Suppl_5
Condensed Consolidating Supplemental Guarantor Information - Balance Sheet (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 |
Current assets | |||
Cash and cash equivalents | $ 1,214 | $ 509 | $ 414 |
Accounts receivable, net | 1,353 | 1,490 | |
Inventories | 747 | 784 | |
Due from affiliates | 0 | 0 | |
Other current assets | 463 | 361 | |
Total current assets | 3,777 | 3,144 | |
Property, plant and equipment, net | 399 | 413 | |
Goodwill | 2,821 | 2,832 | |
Intangibles, net | 580 | 607 | |
Operating lease assets | 362 | 391 | |
Prepaid pension cost | 176 | 178 | |
Deferred Income Taxes and Other Assets, Noncurrent | 808 | 821 | |
Investments in subsidiaries | 0 | 0 | |
Due from affiliates | 0 | 0 | |
Other assets | 632 | 601 | |
Total assets | 9,555 | 8,987 | |
Current liabilities | |||
Short-term borrowings | 304 | 282 | |
Accounts payable | 790 | 840 | |
Payroll and benefits liabilities | 186 | 308 | |
Contract with Customer, Liability, Current | 616 | 502 | |
Contract with Customer, Liability, Noncurrent | 75 | 81 | |
Due to affiliates | 0 | 0 | |
Other current liabilities | 510 | 606 | |
Total current liabilities | 2,406 | 2,538 | |
Long-term debt | 4,081 | 3,277 | |
Pension and indemnity plan liabilities | 855 | 858 | |
Postretirement and postemployment benefits liabilities | 112 | 111 | |
Income tax accruals | 89 | 92 | |
Due to affiliates | 0 | 0 | |
Operating lease liabilities | 346 | 369 | |
Other liabilities | 244 | 240 | |
Total liabilities | 8,133 | 7,485 | |
Redeemable noncontrolling interest | 0 | 0 | |
Series A convertible preferred stock | 395 | 395 | |
Stockholders’ equity | |||
Total NCR stockholders’ equity | 1,024 | 1,104 | |
Noncontrolling interests in subsidiaries | 3 | 3 | |
Total stockholders’ equity | 1,027 | 1,107 | |
Total liabilities and stockholders’ equity | 9,555 | 8,987 | |
Eliminations | |||
Current assets | |||
Cash and cash equivalents | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | |
Inventories | 0 | 0 | |
Due from affiliates | (4,865) | (3,657) | |
Other current assets | 0 | 0 | |
Total current assets | (4,865) | (3,657) | |
Property, plant and equipment, net | 0 | 0 | |
Goodwill | 0 | 0 | |
Intangibles, net | 0 | 0 | |
Operating lease assets | 0 | 0 | |
Prepaid pension cost | 0 | 0 | |
Deferred Income Taxes and Other Assets, Noncurrent | 0 | 0 | |
Investments in subsidiaries | (8,077) | (8,056) | |
Due from affiliates | (91) | (91) | |
Other assets | 0 | 0 | |
Total assets | (13,033) | (11,804) | |
Current liabilities | |||
Short-term borrowings | 0 | 0 | |
Accounts payable | 0 | 0 | |
Payroll and benefits liabilities | 0 | 0 | |
Contract with Customer, Liability, Current | 0 | 0 | |
Due to affiliates | (4,865) | (3,657) | |
Other current liabilities | 0 | 0 | |
Total current liabilities | (4,865) | (3,657) | |
Long-term debt | 0 | 0 | |
Pension and indemnity plan liabilities | 0 | 0 | |
Postretirement and postemployment benefits liabilities | 0 | 0 | |
Income tax accruals | 0 | 0 | |
Due to affiliates | (91) | (91) | |
Operating lease liabilities | 0 | 0 | |
Other liabilities | 0 | 0 | |
Total liabilities | (4,956) | (3,748) | |
Redeemable noncontrolling interest | 0 | 0 | |
Series A convertible preferred stock | 0 | 0 | |
Stockholders’ equity | |||
Total NCR stockholders’ equity | (8,077) | (8,056) | |
Noncontrolling interests in subsidiaries | 0 | 0 | |
Total stockholders’ equity | (8,077) | (8,056) | |
Total liabilities and stockholders’ equity | (13,033) | (11,804) | |
Parent Issuer | |||
Current assets | |||
Cash and cash equivalents | 945 | 15 | 21 |
Accounts receivable, net | 77 | 54 | |
Inventories | 236 | 315 | |
Due from affiliates | 853 | 909 | |
Other current assets | 220 | 122 | |
Total current assets | 2,331 | 1,415 | |
Property, plant and equipment, net | 265 | 280 | |
Goodwill | 2,186 | 2,183 | |
Intangibles, net | 456 | 471 | |
Operating lease assets | 238 | 254 | |
Prepaid pension cost | 0 | 0 | |
Deferred Income Taxes and Other Assets, Noncurrent | 331 | 335 | |
Investments in subsidiaries | 4,119 | 4,118 | |
Due from affiliates | 16 | 16 | |
Other assets | 563 | 527 | |
Total assets | 10,505 | 9,599 | |
Current liabilities | |||
Short-term borrowings | 9 | 8 | |
Accounts payable | 357 | 427 | |
Payroll and benefits liabilities | 88 | 188 | |
Contract with Customer, Liability, Current | 336 | 245 | |
Due to affiliates | 2,963 | 2,730 | |
Other current liabilities | 218 | 261 | |
Total current liabilities | 3,971 | 3,859 | |
Long-term debt | 4,078 | 3,199 | |
Pension and indemnity plan liabilities | 590 | 586 | |
Postretirement and postemployment benefits liabilities | 16 | 17 | |
Income tax accruals | 30 | 29 | |
Due to affiliates | 0 | 0 | |
Operating lease liabilities | 269 | 282 | |
Other liabilities | 132 | 128 | |
Total liabilities | 9,086 | 8,100 | |
Redeemable noncontrolling interest | 0 | 0 | |
Series A convertible preferred stock | 395 | 395 | |
Stockholders’ equity | |||
Total NCR stockholders’ equity | 1,024 | 1,104 | |
Noncontrolling interests in subsidiaries | 0 | 0 | |
Total stockholders’ equity | 1,024 | 1,104 | |
Total liabilities and stockholders’ equity | 10,505 | 9,599 | |
Guarantor Subsidiary | |||
Current assets | |||
Cash and cash equivalents | 3 | 3 | 3 |
Accounts receivable, net | 1 | 1 | |
Inventories | 1 | 1 | |
Due from affiliates | 2,218 | 2,217 | |
Other current assets | 1 | 1 | |
Total current assets | 2,224 | 2,223 | |
Property, plant and equipment, net | 0 | 0 | |
Goodwill | 0 | 0 | |
Intangibles, net | 0 | 0 | |
Operating lease assets | 0 | 0 | |
Prepaid pension cost | 0 | 0 | |
Deferred Income Taxes and Other Assets, Noncurrent | 2 | 2 | |
Investments in subsidiaries | 3,958 | 3,938 | |
Due from affiliates | 1 | 1 | |
Other assets | 1 | 1 | |
Total assets | 6,186 | 6,165 | |
Current liabilities | |||
Short-term borrowings | 0 | 0 | |
Accounts payable | 0 | 0 | |
Payroll and benefits liabilities | 0 | 0 | |
Contract with Customer, Liability, Current | 1 | 1 | |
Due to affiliates | 109 | 108 | |
Other current liabilities | 1 | 1 | |
Total current liabilities | 111 | 110 | |
Long-term debt | 0 | 0 | |
Pension and indemnity plan liabilities | 0 | 0 | |
Postretirement and postemployment benefits liabilities | 3 | 3 | |
Income tax accruals | 0 | 0 | |
Due to affiliates | 74 | 74 | |
Operating lease liabilities | 0 | 0 | |
Other liabilities | 0 | 0 | |
Total liabilities | 188 | 187 | |
Redeemable noncontrolling interest | 0 | 0 | |
Series A convertible preferred stock | 0 | 0 | |
Stockholders’ equity | |||
Total NCR stockholders’ equity | 5,998 | 5,978 | |
Noncontrolling interests in subsidiaries | 0 | 0 | |
Total stockholders’ equity | 5,998 | 5,978 | |
Total liabilities and stockholders’ equity | 6,186 | 6,165 | |
Non-Guarantor Subsidiaries | |||
Current assets | |||
Cash and cash equivalents | 266 | 491 | $ 390 |
Accounts receivable, net | 1,275 | 1,435 | |
Inventories | 510 | 468 | |
Due from affiliates | 1,794 | 531 | |
Other current assets | 242 | 238 | |
Total current assets | 4,087 | 3,163 | |
Property, plant and equipment, net | 134 | 133 | |
Goodwill | 635 | 649 | |
Intangibles, net | 124 | 136 | |
Operating lease assets | 124 | 137 | |
Prepaid pension cost | 176 | 178 | |
Deferred Income Taxes and Other Assets, Noncurrent | 475 | 484 | |
Investments in subsidiaries | 0 | 0 | |
Due from affiliates | 74 | 74 | |
Other assets | 68 | 73 | |
Total assets | 5,897 | 5,027 | |
Current liabilities | |||
Short-term borrowings | 295 | 274 | |
Accounts payable | 433 | 413 | |
Payroll and benefits liabilities | 98 | 120 | |
Contract with Customer, Liability, Current | 279 | 256 | |
Due to affiliates | 1,793 | 819 | |
Other current liabilities | 291 | 344 | |
Total current liabilities | 3,189 | 2,226 | |
Long-term debt | 3 | 78 | |
Pension and indemnity plan liabilities | 265 | 272 | |
Postretirement and postemployment benefits liabilities | 93 | 91 | |
Income tax accruals | 59 | 63 | |
Due to affiliates | 17 | 17 | |
Operating lease liabilities | 77 | 87 | |
Other liabilities | 112 | 112 | |
Total liabilities | 3,815 | 2,946 | |
Redeemable noncontrolling interest | 0 | 0 | |
Series A convertible preferred stock | 0 | 0 | |
Stockholders’ equity | |||
Total NCR stockholders’ equity | 2,079 | 2,078 | |
Noncontrolling interests in subsidiaries | 3 | 3 | |
Total stockholders’ equity | 2,082 | 2,081 | |
Total liabilities and stockholders’ equity | $ 5,897 | $ 5,027 |
Condensed Consolidating Suppl_6
Condensed Consolidating Supplemental Guarantor Information - Statement of Cash Flows (Details) - USD ($) $ in Millions | 3 Months Ended | |||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2017 | |
Proceeds from Contributions from Parent | $ 0 | |||||
Net cash provided by (used in) operating activities | $ 61 | (16) | ||||
Investing activities | ||||||
Expenditures for property, plant and equipment | (10) | (22) | ||||
Proceeds from sale of property, plant and equipment | 7 | 0 | ||||
Additions to capitalized software | (69) | (43) | ||||
Proceeds from (payments of) intercompany notes | 0 | 0 | ||||
Investments in equity affiliates | 0 | |||||
Business acquisitions, net | (26) | (6) | ||||
Net change in funds held for clients - investing | 0 | 0 | ||||
Increase (Decrease) in Client Funds Held | 12 | 17 | ||||
Other investing activities, net | 0 | 3 | ||||
Net Cash Provided by (Used in) Investing Activities | (98) | (68) | ||||
Financing activities | ||||||
Short term borrowings, net | (3) | (7) | ||||
Payments on term credit facilities | (2) | (17) | ||||
Payments on revolving credit facilities | (573) | (375) | ||||
Borrowings on revolving credit facilities | 1,397 | 430 | ||||
Repurchases of Common Stock | (41) | 0 | ||||
Payments of Debt Issuance Costs | (1) | 0 | ||||
Payments of Ordinary Dividends, Preferred Stock and Preference Stock | (6) | 0 | ||||
Proceeds from employee stock plans | 3 | 4 | ||||
Proceeds from (Payments for) Other Financing Activities | (3) | 0 | ||||
SEC Schedule, 12-04, Cash Dividends Paid to Registrant, Consolidated Subsidiaries | 0 | |||||
Borrowings (repayments) of intercompany notes | 0 | 0 | ||||
Tax withholding payments on behalf of employees | (24) | (13) | ||||
Net Cash Provided by (Used in) Financing Activities | 765 | 53 | ||||
Cash flows from discontinued operations | ||||||
Net cash provided by (used in) operating activities | 3 | (6) | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (14) | 1 | ||||
Increase (decrease) in cash, cash equivalents, and restricted cash | 717 | (36) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 548 | 522 | ||||
Cash, cash equivalents and restricted cash at end of period | 1,265 | 486 | ||||
Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows | ||||||
Cash and cash equivalents | $ 1,214 | $ 509 | $ 414 | |||
Restricted cash included in other assets | 51 | 72 | 72 | |||
Total cash, cash equivalents and restricted cash | 1,265 | 486 | 1,265 | 548 | 486 | $ 522 |
Eliminations | ||||||
Proceeds from Contributions from Parent | 10 | |||||
Net cash provided by (used in) operating activities | (1) | 0 | ||||
Investing activities | ||||||
Expenditures for property, plant and equipment | 0 | 0 | ||||
Proceeds from sale of property, plant and equipment | 0 | |||||
Additions to capitalized software | 0 | 0 | ||||
Proceeds from (payments of) intercompany notes | (252) | (59) | ||||
Investments in equity affiliates | (10) | |||||
Business acquisitions, net | 0 | 0 | ||||
Net change in funds held for clients - investing | 0 | 0 | ||||
Increase (Decrease) in Client Funds Held | 0 | 0 | ||||
Other investing activities, net | 0 | |||||
Net Cash Provided by (Used in) Investing Activities | (252) | (69) | ||||
Financing activities | ||||||
Short term borrowings, net | 0 | 0 | ||||
Payments on term credit facilities | 0 | 0 | ||||
Payments on revolving credit facilities | 0 | 0 | ||||
Borrowings on revolving credit facilities | 0 | 0 | ||||
Repurchases of Common Stock | 0 | |||||
Payments of Debt Issuance Costs | 0 | |||||
Payments of Ordinary Dividends, Preferred Stock and Preference Stock | 0 | |||||
Proceeds from employee stock plans | 0 | 0 | ||||
Proceeds from (Payments for) Other Financing Activities | 0 | |||||
SEC Schedule, 12-04, Cash Dividends Paid to Registrant, Consolidated Subsidiaries | 1 | |||||
Borrowings (repayments) of intercompany notes | 252 | 59 | ||||
Tax withholding payments on behalf of employees | 0 | 0 | ||||
Net Cash Provided by (Used in) Financing Activities | 253 | 69 | ||||
Cash flows from discontinued operations | ||||||
Net cash provided by (used in) operating activities | 0 | 0 | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 0 | 0 | ||||
Increase (decrease) in cash, cash equivalents, and restricted cash | 0 | 0 | ||||
Cash, cash equivalents and restricted cash at beginning of period | 0 | 0 | ||||
Cash, cash equivalents and restricted cash at end of period | 0 | 0 | ||||
Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows | ||||||
Cash and cash equivalents | 0 | 0 | 0 | |||
Restricted cash included in other assets | 0 | 0 | ||||
Total cash, cash equivalents and restricted cash | 0 | 0 | 0 | 0 | 0 | |
Parent Issuer | ||||||
Proceeds from Contributions from Parent | 0 | |||||
Net cash provided by (used in) operating activities | (67) | 111 | ||||
Investing activities | ||||||
Expenditures for property, plant and equipment | (2) | (13) | ||||
Proceeds from sale of property, plant and equipment | 7 | |||||
Additions to capitalized software | (55) | (36) | ||||
Proceeds from (payments of) intercompany notes | 242 | 29 | ||||
Investments in equity affiliates | 0 | |||||
Business acquisitions, net | (6) | (6) | ||||
Net change in funds held for clients - investing | 0 | 0 | ||||
Increase (Decrease) in Client Funds Held | 0 | 0 | ||||
Other investing activities, net | 3 | |||||
Net Cash Provided by (Used in) Investing Activities | 186 | (23) | ||||
Financing activities | ||||||
Short term borrowings, net | (2) | 0 | ||||
Payments on term credit facilities | (2) | (17) | ||||
Payments on revolving credit facilities | (430) | (375) | ||||
Borrowings on revolving credit facilities | 1,310 | 330 | ||||
Repurchases of Common Stock | (41) | |||||
Payments of Debt Issuance Costs | (1) | |||||
Payments of Ordinary Dividends, Preferred Stock and Preference Stock | (6) | |||||
Proceeds from employee stock plans | 3 | 4 | ||||
Proceeds from (Payments for) Other Financing Activities | (2) | |||||
SEC Schedule, 12-04, Cash Dividends Paid to Registrant, Consolidated Subsidiaries | 0 | |||||
Borrowings (repayments) of intercompany notes | 0 | 0 | ||||
Tax withholding payments on behalf of employees | (24) | (13) | ||||
Net Cash Provided by (Used in) Financing Activities | 809 | (71) | ||||
Cash flows from discontinued operations | ||||||
Net cash provided by (used in) operating activities | 3 | (6) | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 0 | 0 | ||||
Increase (decrease) in cash, cash equivalents, and restricted cash | 931 | 11 | ||||
Cash, cash equivalents and restricted cash at beginning of period | 15 | 11 | ||||
Cash, cash equivalents and restricted cash at end of period | 946 | 22 | ||||
Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows | ||||||
Cash and cash equivalents | 945 | 15 | 21 | |||
Restricted cash included in other assets | 1 | 1 | ||||
Total cash, cash equivalents and restricted cash | 946 | 22 | 946 | 15 | 22 | |
Guarantor Subsidiary | ||||||
Proceeds from Contributions from Parent | (10) | |||||
Net cash provided by (used in) operating activities | (10) | (20) | ||||
Investing activities | ||||||
Expenditures for property, plant and equipment | 0 | 0 | ||||
Proceeds from sale of property, plant and equipment | 0 | |||||
Additions to capitalized software | 0 | 0 | ||||
Proceeds from (payments of) intercompany notes | 10 | 30 | ||||
Investments in equity affiliates | 0 | |||||
Business acquisitions, net | 0 | 0 | ||||
Net change in funds held for clients - investing | 0 | 0 | ||||
Increase (Decrease) in Client Funds Held | 0 | 0 | ||||
Other investing activities, net | 0 | |||||
Net Cash Provided by (Used in) Investing Activities | 10 | 30 | ||||
Financing activities | ||||||
Short term borrowings, net | 0 | 0 | ||||
Payments on term credit facilities | 0 | 0 | ||||
Payments on revolving credit facilities | 0 | 0 | ||||
Borrowings on revolving credit facilities | 0 | 0 | ||||
Repurchases of Common Stock | 0 | |||||
Payments of Debt Issuance Costs | 0 | |||||
Payments of Ordinary Dividends, Preferred Stock and Preference Stock | 0 | |||||
Proceeds from employee stock plans | 0 | 0 | ||||
Proceeds from (Payments for) Other Financing Activities | 0 | |||||
SEC Schedule, 12-04, Cash Dividends Paid to Registrant, Consolidated Subsidiaries | 0 | |||||
Borrowings (repayments) of intercompany notes | 0 | 0 | ||||
Tax withholding payments on behalf of employees | 0 | 0 | ||||
Net Cash Provided by (Used in) Financing Activities | 0 | (10) | ||||
Cash flows from discontinued operations | ||||||
Net cash provided by (used in) operating activities | 0 | 0 | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 0 | 0 | ||||
Increase (decrease) in cash, cash equivalents, and restricted cash | 0 | 0 | ||||
Cash, cash equivalents and restricted cash at beginning of period | 3 | 3 | ||||
Cash, cash equivalents and restricted cash at end of period | 3 | 3 | ||||
Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows | ||||||
Cash and cash equivalents | 3 | 3 | 3 | |||
Restricted cash included in other assets | 0 | 0 | ||||
Total cash, cash equivalents and restricted cash | 3 | 3 | 3 | 3 | 3 | |
Non-Guarantor Subsidiaries | ||||||
Proceeds from Contributions from Parent | 0 | |||||
Net cash provided by (used in) operating activities | 139 | (107) | ||||
Investing activities | ||||||
Expenditures for property, plant and equipment | (8) | (9) | ||||
Proceeds from sale of property, plant and equipment | 0 | |||||
Additions to capitalized software | (14) | (7) | ||||
Proceeds from (payments of) intercompany notes | 0 | 0 | ||||
Investments in equity affiliates | 10 | |||||
Business acquisitions, net | (20) | 0 | ||||
Net change in funds held for clients - investing | 0 | 0 | ||||
Increase (Decrease) in Client Funds Held | 12 | 17 | ||||
Other investing activities, net | 0 | |||||
Net Cash Provided by (Used in) Investing Activities | (42) | (6) | ||||
Financing activities | ||||||
Short term borrowings, net | (1) | (7) | ||||
Payments on term credit facilities | 0 | 0 | ||||
Payments on revolving credit facilities | (143) | 0 | ||||
Borrowings on revolving credit facilities | 87 | 100 | ||||
Repurchases of Common Stock | 0 | |||||
Payments of Debt Issuance Costs | 0 | |||||
Payments of Ordinary Dividends, Preferred Stock and Preference Stock | 0 | |||||
Proceeds from employee stock plans | 0 | 0 | ||||
Proceeds from (Payments for) Other Financing Activities | (1) | |||||
SEC Schedule, 12-04, Cash Dividends Paid to Registrant, Consolidated Subsidiaries | (1) | |||||
Borrowings (repayments) of intercompany notes | (252) | (59) | ||||
Tax withholding payments on behalf of employees | 0 | 0 | ||||
Net Cash Provided by (Used in) Financing Activities | (297) | 65 | ||||
Cash flows from discontinued operations | ||||||
Net cash provided by (used in) operating activities | 0 | 0 | ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (14) | 1 | ||||
Increase (decrease) in cash, cash equivalents, and restricted cash | (214) | (47) | ||||
Cash, cash equivalents and restricted cash at beginning of period | 530 | 508 | ||||
Cash, cash equivalents and restricted cash at end of period | 316 | 461 | ||||
Reconciliation of cash, cash equivalents and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows | ||||||
Cash and cash equivalents | 266 | 491 | 390 | |||
Restricted cash included in other assets | 50 | 71 | ||||
Total cash, cash equivalents and restricted cash | $ 316 | $ 461 | $ 316 | $ 530 | $ 461 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | Apr. 13, 2020 | Mar. 31, 2020 |
8.125% Notes Due 2025 [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Long-term Debt | $ 400 | |
Percentage of Principle Amount Notes Were Sold At | 100.00% | |
Debt Instrument Redemption Price As Percentage of Principle Amount | 100.00% | |
Twelve Month Period Commencing April 15, 2023 [Member] | 8.125% Notes Due 2025 [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Debt Instrument Redemption Price As Percentage of Principle Amount | 102.031% | |
Twelve month period commencing on April 15, 2022 [Member] | 8.125% Notes Due 2025 [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Debt Instrument Redemption Price As Percentage of Principle Amount | 104.063% | |
Twelve month period commencing on April 15, 2024 [Member] | 8.125% Notes Due 2025 [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Debt Instrument Redemption Price As Percentage of Principle Amount | 100.00% | |
Guarantor Subsidiary | NCR International, Inc. [Member] | ||
Subsequent Event [Line Items] | ||
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions | 100.00% | |
Guarantor Subsidiary | 8.125% Notes Due 2025 [Member] | NCR International, Inc. [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.125% |