Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 04, 2020 | Jun. 29, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 000-19406 | ||
Entity Registrant Name | Zebra Technologies Corporation | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 36-2675536 | ||
Entity Address, Address Line One | 3 Overlook Point | ||
Entity Address, City or Town | Lincolnshire | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60069 | ||
City Area Code | 847 | ||
Local Phone Number | 634-6700 | ||
Title of 12(b) Security | Class A Common Stock, par value $.01 per share | ||
Trading Symbol | ZBRA | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 11.2 | ||
Entity Common Stock, Shares Outstanding | 54,008,653 | ||
Documents Incorporated by Reference | Certain sections of the Registrant’s definitive proxy statement for its Annual Meeting of Stockholders to be held on May 14, 2020 , are incorporated by reference into Part III of this report, as indicated herein. The definitive proxy statement shall be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Report relates. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000877212 | ||
Current Fiscal Year End Date | --12-31 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 30 | $ 44 |
Accounts receivable, net of allowances for doubtful accounts of $2 million and $3 million as of December 31, 2019 and 2018, respectively | 613 | 520 |
Inventories, net | 474 | 520 |
Income tax receivable | 32 | 24 |
Prepaid expenses and other current assets | 46 | 54 |
Total Current assets | 1,195 | 1,162 |
Property, plant and equipment, net | 259 | 249 |
Right-of-use lease asset | 107 | |
Goodwill | 2,622 | 2,495 |
Other intangibles, net | 275 | 232 |
Deferred income taxes | 127 | 114 |
Other long-term assets | 126 | 87 |
Total Assets | 4,711 | 4,339 |
Current liabilities: | ||
Current portion of long-term debt | 197 | 157 |
Accounts payable | 552 | 552 |
Accrued liabilities | 379 | 322 |
Deferred revenue | 238 | 210 |
Income taxes payable | 38 | 60 |
Total Current liabilities | 1,404 | 1,301 |
Long-term debt | 1,080 | 1,434 |
Long-term lease liabilities | 100 | |
Deferred income taxes | 0 | 8 |
Long-term deferred revenue | 221 | 172 |
Other long-term liabilities | 67 | 89 |
Total Liabilities | 2,872 | 3,004 |
Stockholders’ Equity: | ||
Preferred stock, $.01 par value; authorized 10,000,000 shares; none issued | 0 | 0 |
Class A common stock, $.01 par value; authorized 150,000,0000 shares; issued 72,151,857 shares | 1 | 1 |
Additional paid-in capital | 339 | 294 |
Treasury stock at cost, 18,148,925 and 18,280,673 shares as of December 31, 2019 and 2018, respectively | (689) | (613) |
Retained earnings | 2,232 | 1,688 |
Accumulated other comprehensive loss | (44) | (35) |
Total Stockholders’ Equity | 1,839 | 1,335 |
Total Liabilities and Stockholders’ Equity | $ 4,711 | $ 4,339 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 2 | $ 3 |
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares Issued | 0 | 0 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 72,151,857 | 72,151,857 |
Treasury stock, shares | 18,148,925 | 18,280,673 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net sales | |||
Total Net sales | $ 4,485 | $ 4,218 | $ 3,722 |
Cost of sales: | |||
Total Cost of sales | 2,385 | 2,237 | 2,012 |
Gross profit | 2,100 | 1,981 | 1,710 |
Operating expenses: | |||
Selling and marketing | 503 | 483 | 448 |
Research and development | 447 | 444 | 389 |
General and administrative | 323 | 328 | 301 |
Amortization of intangible assets | 103 | 97 | 184 |
Acquisition and integration costs | 22 | 8 | 50 |
Exit and restructuring costs | 10 | 11 | 16 |
Total Operating expenses | 1,408 | 1,371 | 1,388 |
Operating income | 692 | 610 | 322 |
Other expenses: | |||
Foreign exchange loss | (6) | (5) | (1) |
Interest expense, net | (89) | (91) | (227) |
Other, net | 1 | 10 | (6) |
Total Other expenses, net | (94) | (86) | (234) |
Income before income tax | 598 | 524 | 88 |
Income tax expense | 54 | 103 | 71 |
Net income | $ 544 | $ 421 | $ 17 |
Basic earnings per share (in USD per share) | $ 10.08 | $ 7.86 | $ 0.33 |
Diluted earnings per share (in USD per share) | $ 9.97 | $ 7.76 | $ 0.32 |
Tangible Products | |||
Net sales | |||
Total Net sales | $ 3,907 | $ 3,685 | $ 3,223 |
Cost of sales: | |||
Total Cost of sales | 2,006 | 1,871 | 1,677 |
Services and Software | |||
Net sales | |||
Total Net sales | 578 | 533 | 499 |
Cost of sales: | |||
Total Cost of sales | $ 379 | $ 366 | $ 335 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 544 | $ 421 | $ 17 |
Other comprehensive income (loss), net of tax: | |||
Changes in unrealized gains and losses on anticipated sales hedging transactions | (10) | 21 | (15) |
Changes in unrealized gains and losses on anticipated sales hedging transactions | (21) | 15 | |
Changes in unrealized gains and losses on forward interest rate swap hedging transactions | 0 | ||
Changes in unrealized gains and losses on forward interest rate swap hedging transactions | 9 | 6 | |
Foreign currency translation adjustment | 1 | (13) | 2 |
Comprehensive income | $ 535 | $ 438 | $ 10 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Millions | Total | Class A Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning Balance at Dec. 31, 2016 | $ 792 | $ 1 | $ 210 | $ (614) | $ 1,240 | $ (45) |
Beginning Balance, Shares at Dec. 31, 2016 | 52,884,588 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of treasury shares upon exercise of stock options, purchases under stock purchase plan and grants of restricted stock awards, net of cancellations (in shares) | 410,239 | |||||
Issuance of treasury shares upon exercise of stock options, purchases under stock purchase plan and grants of restricted stock awards, net of cancellations | 12 | 12 | ||||
Shares withheld related to net share settlement (in shares) | (58,732) | |||||
Shares withheld related to net share settlement | (6) | (6) | ||||
Share-based compensation | 35 | 35 | ||||
Net income | 17 | 17 | ||||
Changes in unrealized gains and losses on anticipated sales hedging transactions (net of income taxes) | (15) | (15) | ||||
Changes in unrealized gains and losses on forward interest rate swap hedging transactions (net of income taxes) | 6 | 6 | ||||
Foreign currency translation adjustment | 2 | 2 | ||||
Ending Balance at Dec. 31, 2017 | 834 | $ 1 | 257 | (620) | 1,248 | (52) |
Ending Balance, Shares at Dec. 31, 2017 | 53,236,095 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of treasury shares upon exercise of stock options, purchases under stock purchase plan and grants of restricted stock awards, net of cancellations (in shares) | 704,137 | |||||
Issuance of treasury shares upon exercise of stock options, purchases under stock purchase plan and grants of restricted stock awards, net of cancellations | 10 | (8) | 18 | |||
Shares withheld related to net share settlement (in shares) | (69,048) | |||||
Shares withheld related to net share settlement | (11) | (11) | ||||
Share-based compensation | 45 | 45 | ||||
Net income | 421 | 421 | ||||
Changes in unrealized gains and losses on anticipated sales hedging transactions (net of income taxes) | 21 | 21 | ||||
Changes in unrealized gains and losses on forward interest rate swap hedging transactions (net of income taxes) | 9 | 9 | ||||
Foreign currency translation adjustment | (13) | (13) | ||||
Ending Balance at Dec. 31, 2018 | 1,335 | $ 1 | 294 | (613) | 1,688 | (35) |
Ending Balance, Shares at Dec. 31, 2018 | 53,871,184 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of treasury shares upon exercise of stock options, purchases under stock purchase plan and grants of restricted stock awards, net of cancellations (in shares) | 594,399 | |||||
Issuance of treasury shares upon exercise of stock options, purchases under stock purchase plan and grants of restricted stock awards, net of cancellations | 11 | (3) | 14 | |||
Shares withheld related to net share settlement (in shares) | (224,765) | |||||
Shares withheld related to net share settlement | (43) | (43) | ||||
Share-based compensation | 48 | 48 | ||||
Repurchase of common stock (in shares) | (237,886) | |||||
Repurchase of common stock | (47) | (47) | ||||
Net income | 544 | 544 | ||||
Changes in unrealized gains and losses on anticipated sales hedging transactions (net of income taxes) | (10) | (10) | ||||
Foreign currency translation adjustment | 1 | 1 | ||||
Ending Balance at Dec. 31, 2019 | $ 1,839 | $ 1 | $ 339 | $ (689) | $ 2,232 | $ (44) |
Ending Balance, Shares at Dec. 31, 2019 | 54,002,932 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net income | $ 544 | $ 421 | $ 17 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 175 | 175 | 263 |
Investment (gain) loss | (3) | (10) | 1 |
Amortization of debt issuance costs and discounts | 6 | 15 | 38 |
Share-based compensation | 48 | 45 | 35 |
Debt extinguishment costs | 1 | 1 | 65 |
Deferred income taxes | (42) | 2 | (9) |
Unrealized loss (gain) on forward interest rate swaps | 19 | (8) | (2) |
Other, net | 0 | 4 | 4 |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | (96) | (31) | 161 |
Inventories, net | 51 | (43) | (110) |
Other assets | (20) | (12) | 16 |
Accounts payable | (5) | 122 | (49) |
Accrued liabilities | (18) | 35 | 13 |
Deferred revenue | 71 | 51 | 17 |
Income taxes | (31) | 24 | 26 |
Other operating activities | (15) | (6) | (8) |
Net cash provided by operating activities | 685 | 785 | 478 |
Cash flows from investing activities: | |||
Acquisition of businesses, net of cash acquired | (262) | (72) | 0 |
Purchases of property, plant and equipment | (61) | (64) | (50) |
Proceeds from the sale of long-term investments | 10 | 2 | 0 |
Purchases of long-term investments | (22) | (3) | (1) |
Net cash used in investing activities | (335) | (137) | (51) |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt | 637 | 909 | 1,371 |
Payments of long term-debt | (949) | (1,566) | (1,825) |
Payments of debt extinguishment costs | (1) | (1) | (65) |
Payments of debt issuance costs and discounts | (6) | (2) | (5) |
Payments for repurchases of common stock | (47) | 0 | 0 |
Payments of taxes related to net settlements of equity awards, net of proceeds from exercise of stock options and stock purchase plan purchases | (32) | (1) | 7 |
Unremitted cash collections from servicing factored receivables | 33 | 0 | 0 |
Net cash used in financing activities | (365) | (661) | (517) |
Effect of exchange rate changes on cash | 1 | (5) | (4) |
Net decrease in cash and cash equivalents | (14) | (18) | (94) |
Cash and cash equivalents at beginning of year | 44 | 62 | 156 |
Cash and cash equivalents at end of year | 30 | 44 | 62 |
Supplemental disclosures of cash flow information: | |||
Income taxes paid | 140 | 76 | 65 |
Interest paid | $ 63 | $ 90 | $ 195 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Principles of Consolidation These accompanying consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States and include the accounts of Zebra and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Fiscal Calendar The Company’s fiscal year is a 52-week period ending on December 31. Interim fiscal quarters end on a Saturday and generally include 13 weeks of operating activity. During the 2019 fiscal year, the Company’s quarter end dates were March 30, June 29, September 28 and December 31. Use of Estimates These consolidated financial statements were prepared using estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Examples of accounting estimates include: cash flow projections and other valuation assumptions included in business acquisition purchase price allocations as well as annual goodwill impairment testing; the measurement of variable consideration and allocation of transaction price to performance obligations in revenue transactions; inventory and product warranty reserves; useful lives of our tangible and intangible assets; and the recognition and measurement of income tax assets and liabilities. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates. Cash and Cash Equivalents Cash consists primarily of deposits with banks. In addition, the Company considers highly liquid short-term investments with original maturities of less than three months to be cash equivalents. These highly liquid short-term investments are readily convertible to known amounts of cash and are so near their maturity that they present insignificant risk of a change in value because of changes in interest rates. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consist primarily of amounts due to us from our customers in the normal course of business. Collateral on trade accounts receivable is generally not required. The Company maintains an allowance for doubtful accounts for estimated uncollectible accounts receivable. The allowance is based on historical experience and our assessment of delinquent accounts. Accounts are written off against the allowance account when they are determined to be no longer collectible. Inventories Inventories are stated at the lower of a moving-average cost (which approximates cost on a first-in, first-out basis) and net realizable value. Manufactured inventory cost includes materials, labor, and manufacturing overhead. Purchased inventory cost also includes internal purchasing overhead costs. Raw material inventories largely consist of supplies used in repair operations. Provisions are made to reduce excess and obsolete inventories to their estimated net realizable values. Inventory provisions are based on forecasted demand, experience with specific customers, the age and nature of the inventory, and the ability to redistribute inventory to other programs or to rework into other consumable inventory. Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the various classes of property, plant and equipment, which are 30 years for buildings and range from 3 to 10 years for all other asset categories. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or 10 years. Leases The Company recognizes Right-of-Use (“ROU”) assets and lease liabilities for its lease commitments with terms greater than one year. Contractual options to extend or terminate lease agreements are reflected in the lease term when they are reasonably certain to be exercised. The initial measurements of new ROU assets and lease liabilities are based on the present value of future lease payments over the lease term as of the commencement date. In determining future lease payments, the Company has elected not to separate lease and non-lease components. As the Company’s lease arrangements do not provide an implicit interest rate, we apply the Company’s incremental borrowing rate based on the information available at the commencement date in determining the present value of future lease payments. Relevant information used in determining the Company’s incremental borrowing rate includes the duration of the lease, transaction currency of the lease, and the Company’s credit risk relative to risk-free market rates. The Company’s ROU assets also include any initial direct costs incurred and exclude lease incentives. The Company’s lease agreements do not contain any material residual value guarantees or restrictive covenants. All leases of the Company are classified as operating leases, with lease expense being recognized on a straight-line basis. Income Taxes The Company accounts for income taxes under the liability method in accordance with Accounting Standards Codification (“ASC”) 740 Topic, Income Taxes . Accordingly, deferred income taxes are provided for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities for financial reporting and income tax purposes. Deferred tax assets and liabilities are measured using tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is established when necessary to reduce deferred tax assets to the amount that is more likely than not to be realized. The Company recognizes the benefit of tax positions when it is more likely than not to be sustained on its technical merits. The Company recognizes interest and penalties related to income tax matters as part of income tax expense. The Company has elected consolidated tax filings in certain of its jurisdictions which may allow the group to offset one member’s income with losses of other members in the current period and on a carryover basis. The income tax effects of non-inventory intra-entity asset transfers are recognized in the period in which the transfer occurs. The Company classifies its balance sheet accounts by applying jurisdictional netting principles for locations where consolidated tax filing elections are in place. The Tax Cut and Jobs Act (“the Act”, or “U.S. Tax Reform”), enacted on December 22, 2017, contains the Global Intangible Low-Taxed Income (“GILTI”), Base Erosion Anti-Avoidance Tax (“BEAT”), and Deduction for Foreign-Derived Intangible Income (“FDII”) provisions, which relate to the taxation of certain foreign income and are effective for tax years beginning on or after January 1, 2018. The Company recognizes its GILTI, BEAT, and FDII inclusions, when applicable, as a charge to tax expense in the year included in its U.S. tax return. The effects of changes in tax rates and laws on deferred tax balances are recorded in the period of enactment as a component of income tax expense within continuing operations, even if they relate to items recorded within accumulated other comprehensive income (loss) (“AOCI”). The Company elected to not reclassify the tax effects of these changes associated with the Act from AOCI to retained earnings. Such tax effects are released into earnings when the underlying portfolio of assets or liabilities giving rise to the AOCI position are fully derecognized. Goodwill Goodwill is not amortized, rather it is tested annually for impairment, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. Our annual impairment testing consists of comparing the estimated fair value of each reporting unit to its carrying value. If the carrying value of a reporting unit exceeds its estimated fair value, goodwill would be considered to be impaired and reduced to its implied fair value. We estimate the fair value of reporting units with valuation techniques, including both the income and market approaches. The income approach requires management to estimate a number of factors for each reporting unit, including projected future operating results, economic projections, anticipated future cash flows and discount rates. The market approach estimates fair value using comparable marketplace fair value data from within a comparable industry group. Fair value determinations require judgment and are sensitive to changes in underlying assumptions, estimates, as well as market factors. Estimating the fair value of reporting units requires that we make a number of assumptions and estimates regarding our long-term growth and cash flow expectations as well as overall industry and economic conditions. These estimates and assumptions include, but are not limited to, projections of revenue and income growth rates, capital investments, competitive and customer trends, appropriate peer group selection, market-based discount rates and other market factors. We performed our annual goodwill impairment testing in the fourth quarter of 2019 using a quantitative approach which did not result in any impairments. See Note 6 , Goodwill and Other Intangibles for additional information. We believe our fair value estimates are reasonable. If actual financial results differ materially from current estimates or there are significant negative changes in market factors beyond our control, there could be an impairment of goodwill in the future. Other Intangible Assets Other intangible assets consist primarily of technology and patent rights, customer and other relationships, and trade names. These assets are recorded at cost and amortized on a straight-line basis over the asset’s useful life which typically range from 3 years to 15 years . Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of The Company accounts for long-lived assets in accordance with the provisions of ASC Topic 360, Property, Plant and Equipment, which requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the sum of the undiscounted cash flows expected to result from the use and the eventual disposition of the asset. If such assets are impaired, the impairment to be recognized is the excess of the carrying amount over the fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. Investments in Securities The Company’s investments primarily include equity securities that are accounted for at cost, adjusted for impairment losses or changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. These investments are primarily in venture capital backed technology companies where the Company's ownership interest is less than 20% of each investee and the Company does not have the ability to exercise significant influence. See Note 8 , Investments for additional information. Revenue Recognition Revenues are primarily comprised of sales of hardware, services, and supplies. The Company also generates revenues from its solutions and software offerings, primarily licenses and maintenance. Our service offerings are principally product repair and maintenance service contracts, which typically occur over time, and professional services such as installation, integration and provisioning, which typically occur in the early stages of a project. The average life of repair and maintenance service contracts is approximately three years. Professional service arrangements range in duration from a day to several weeks or months. We recognize revenues when we transfer control of promised goods or services to our customers in an amount that reflects the consideration to which we expect to receive, which includes estimates of variable consideration, in exchange for those goods or services. We are typically the principal in all elements of our transactions and record Net sales and Cost of sales on a gross basis. The Company elects to exclude from the transaction price sales and other taxes assessed by a governmental authority and collected by the Company from a customer. The Company also considers shipping and handling activities as part of its fulfillment costs and not as a separate performance obligation. See Note 3 , Revenues for additional information. Research and Development Costs Research and development (“R&D”) costs are expensed as incurred, and include: • Salaries, benefits, and other R&D personnel related costs; • Consulting and other outside services used in the R&D process; • Engineering supplies; • Engineering related information systems costs; and • Allocation of building and related costs. Advertising Advertising is expensed as incurred. Advertising costs totaled $19 million , $18 million , and $18 million for the years ended 2019 , 2018 and 2017 , respectively. Warranties In general, the Company provides warranty coverage of one year on mobile computers, printers and batteries. Advanced data capture products are warrantied from one to five years , depending on the product. Thermal printheads are warrantied for six months and battery-based products, such as location tags, are covered by a 90 -day warranty. A provision for warranty expense is adjusted quarterly based on historical and expected warranty experience. Contingencies The Company establishes a liability for loss contingencies when the loss is both probable and estimable. In addition, for some matters for which a loss is probable or reasonably possible, an estimate of the amount of loss or range of loss is not possible, and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of non-monetary remedies. Fair Value of Financial Instruments Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Our financial assets and liabilities that require recognition and fair value measurement under the accounting guidance generally include our employee deferred compensation plan investments, foreign currency forwards, and interest rate swaps. In accordance with ASC Topic 815, Derivatives and Hedging (“ASC 815”) , we recognize derivative instruments and hedging activities as either assets or liabilities on the Consolidated Balance Sheets and measure them at fair value. Gains and losses resulting from changes in fair value are accounted for depending on the use of the derivative and whether it is designated and qualifies for hedge accounting. See Note 11 , Derivative Instruments for additional information on the Company’s derivatives and hedging activities. The Company utilizes foreign currency forwards to hedge certain foreign currency exposures and interest rate swaps to hedge a portion of the variability in future cash flows on debt. We use broker quotations or market transactions, in either the listed or over-the-counter markets, to value our foreign currency exchange contracts and relevant observable market inputs at quoted intervals, such as forward yield curves and the Company’s own credit risk to value our interest rate swaps. The Company’s securities held for its deferred compensation plans are measured at fair value using quoted prices in active markets for identical assets. If active markets for identical assets are not available to determine fair value, then we use quoted prices for similar assets or inputs that are observable either directly or indirectly. The carrying amounts of cash and cash equivalents, receivables and accounts payable approximate fair value due to the short-term nature of those financial instruments. See Note 10 , Fair Value Measurements for information related to financial assets and liabilities carried at fair value. Share-Based Compensation The Company has share-based compensation plans and an employee stock purchase plan under which shares of Class A Common Stock are available for future grants and sales. The Company recognizes compensation costs over the vesting period of up to 4 years , net of estimated forfeitures. Compensation costs associated with awards with graded vesting terms are recognized on a straight-line basis. See Note 15 , Share-Based Compensation for additional information. Foreign Currency Translation The balance sheet accounts of the Company’s subsidiaries that have not designated the U.S. Dollar as its functional currency are translated into U.S. Dollars using the period-end exchange rate, and statement of earnings items are translated using the average exchange rate for the period. The resulting translation gains or losses are recorded in Stockholders’ equity as a cumulative translation adjustment, which is a component of AOCI within the Consolidated Balance Sheets. Acquisitions We account for acquired businesses using the acquisition method of accounting. This method requires that the purchase price be allocated to the identifiable assets acquired and liabilities assumed at their estimated fair values. The excess of the purchase price over the identifiable assets acquired and liabilities assumed is recorded as goodwill. The estimates used to determine the fair values of long-lived assets, such as intangible assets, can be complex and require judgment. We use information available to us to make fair value determinations and engage independent valuation specialists, when necessary, to assist in the fair value determinations of significant acquired long-lived assets. While we use our best estimates and assumptions as a part of the purchase price allocation process, our estimates are inherently uncertain and subject to refinement during the measurement period, which is up to one year after the acquisition date. Critical estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from revenues and operating activities, customer attrition rates, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but due to the inherent uncertainty during the measurement period, we may record adjustments to the fair value of assets acquired and liabilities assumed with a corresponding adjustment to goodwill. Recently Adopted Accounting Pronouncements On January 1, 2019, the Company adopted ASC Topic 842, Leases (“ASC 842”), which increases the transparency and comparability of organizations by recognizing ROU assets and lease liabilities on the Consolidated Balance Sheets and disclosing key quantitative and qualitative information about leasing arrangements. The principal difference from previous guidance is that the ROU assets and lease liabilities arising from operating leases were not previously recognized on the Consolidated Balance Sheet. Results for reporting periods beginning after January 1, 2019 are reported under ASC 842, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC Topic 840, Leases (“ASC 840”). In transition, we elected a number of practical expedients, including the election to not reassess existing or expired contracts to determine if such contracts contain a lease or if the lease classification would differ, as well as the election to not separate lease and non-lease components for arrangements where the Company is a lessee. The impact of the adoption of ASC 842 to the Company’s Consolidated Balance Sheets as of January 1, 2019 was as follows (in millions): As Reported December 31, 2018 Adjustment As Adjusted January 1, 2019 Assets: Prepaid expenses and other current assets (1) $ 54 $ (1 ) $ 53 Right-of-use assets — 110 110 Liabilities: Accrued liabilities (2) 322 28 350 Long-term lease liabilities — 103 103 Other long-term liabilities (1) 89 (22 ) 67 (1) Reflects an adjustment related to prepaid and accrued rent balances, which are included in the measurement of ROU assets. (2) Reflects the current portion of the lease liabilities. As a result of the transition, there was no impact to the Company’s Consolidated Statements of Operations or Cash Flows for the year ended December 31, 2019 , compared to what would have been reported in accordance with ASC 840. In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . This ASU clarifies existing guidance related to implementation costs incurred in cloud computing arrangements, including the recognition, subsequent measurement, and financial statement presentation of such costs. The standard was early adopted prospectively by the Company during the second quarter of 2019 and did not have a material impact to the Company’s consolidated financial statements or disclosures. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments . The ASU requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. It replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. With respect to the Company’s financial assets, including trade receivables and contract assets, a cumulative effect transition approach will be applied. The standard will be effective for the Company in the first quarter of 2020. Management has assessed the impact of the ASU and determined, based on current operations, that it will not have a material impact to the Company’s consolidated financial statements or disclosures. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues On January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), applying the modified retrospective method to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC Topic 605, Revenue Recognition (“ASC 605”) . The adoption of ASC 606 did not have a material effect on the Company’s consolidated financial statements or results of operations. The Company recognizes revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration which it expects to receive for providing those goods or services. To determine total expected consideration, the Company estimates elements of variable consideration, which primarily include product rights of return, rebates, price protection and other incentives. These estimates are developed using the expected value or the most likely amount method and are reviewed and updated, as necessary, at each reporting period. Revenues, inclusive of variable consideration, are recognized to the extent it is probable that a significant reversal in cumulative revenues recognized will not occur in future periods. We enter into contract arrangements that may include various combinations of tangible products, services, solution and software offerings, which are generally capable of being distinct and accounted for as separate performance obligations. We evaluate whether two or more contracts should be combined and accounted for as a single contract and whether the combined or single contract has more than one performance obligation. This evaluation requires judgment, and the decision to combine a group of contracts or separate the combined or single contract into multiple distinct performance obligations may impact the amount of revenue recorded in a reporting period. We deem performance obligations to be distinct if the customer can benefit from the product or service on its own or together with readily available resources (“capable of being distinct”) and if the transfer of products or services is separately identifiable from other promises in the contract (“distinct within the context of the contract”). For contract arrangements that include multiple performance obligations, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices for each performance obligation. In general, standalone selling prices are observable for tangible products and software licenses, while standalone selling prices for professional services, repair and maintenance services, and solutions are developed with an expected cost-plus margin or residual approach. When the residual approach cannot be applied, regional pricing, marketing strategies and business practices are evaluated to derive the estimated standalone selling price using a cost-plus margin methodology. The Company recognizes revenue for each performance obligation upon transfer of control of the promised goods or services. Control is deemed to have been transferred when the customer has the ability to direct the use of and has obtained substantially all of the remaining benefits from the goods and services. The determination of whether control transfers at a point in time or over time requires judgment and includes consideration of the following : 1) the customer simultaneously receives and consumes the benefits provided as the Company performs its promises; 2) the Company’s performance creates or enhances an asset that is under control of the customer; 3) the Company’s performance does not create an asset with an alternative use to the Company; and 4) the Company has an enforceable right to payment for its performance completed to date. Substantially all revenue for tangible products and perpetual or term software licenses is recognized at a point in time, which is generally upon shipment, transfer of control and risks of ownership to the customer, and the Company having contractual right to payment. Revenue for services and Company-hosted software license and maintenance agreements, as well as solutions, is predominantly recognized over time. Assuming all other criteria for revenue recognition have been met, for products and services sold on a standalone basis, revenue is generally recognized upon shipment and by using an output method or time-based method, respectively. In cases where a bundle of products and services are delivered to the customer, judgment is required to select the method of progress which best reflects the transfer of control. The Company’s remaining obligations that are greater than one year in duration relate primarily to repair and support services. The aggregated transaction price allocated to remaining performance obligations related to these types of service arrangements, inclusive of deferred revenue, was $724 million and $489 million as of December 31, 2019 and 2018 , respectively. On average, remaining performance obligations as of December 31, 2019 and 2018 are expected to be recognized over a period of approximately two years . Disaggregation of Revenue The following table presents our Net sales disaggregated by product category for each of our segments, Asset Intelligence & Tracking (“AIT”) and Enterprise Visibility & Mobility (“EVM”), for the years ended December 31, 2019 and 2018 (in millions): Year Ended December 31, 2019 Year Ended December 31, 2018 Segment Tangible Products Services and Software Total Tangible Products Services and Software Total AIT $ 1,347 $ 132 $ 1,479 $ 1,298 $ 125 $ 1,423 EVM 2,560 446 3,006 2,387 408 2,795 Total $ 3,907 $ 578 $ 4,485 $ 3,685 $ 533 $ 4,218 In addition, refer to Note 20 , Segment Information & Geographic Data for Net sales to customers by geographic region. Contract Balances Progress on satisfying performance obligations under contracts with customers is reflected on the Consolidated Balance Sheets in Accounts receivable, net for billed revenues. Progress on satisfying performance obligations under contracts with customers related to unbilled revenues (“contract assets”) is reflected on the Consolidated Balance Sheets as Prepaid expenses and other current assets for revenues expected to be billed within the next 12-months, and Other long-term assets for revenues expected to be billed thereafter. The total closing contract asset balances were $8 million and $5 million as of December 31, 2019 and 2018 , respectively. The opening contract asset balance upon the Company’s transition to ASC 606 as of January 1, 2018 was $7 million . These contract assets result from timing differences between the billing and delivery schedules of products, services and software, as well as the impact from the allocation of the transaction price among performance obligations for contracts that include multiple performance obligations. Contract assets are evaluated for impairment and no impairment losses have been recognized during the years ended December 31, 2019 and 2018 . Deferred revenue on the Consolidated Balance Sheets consist of payments and billings in advance of our performance. The combined short-term and long-term deferred revenue balances were $459 million and $382 million as of December 31, 2019 and 2018 , respectively. The Company recognized $219 million and $181 million in revenue that was previously included in the beginning balance of deferred revenue during the years ended December 31, 2019 and 2018 , respectively. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined that our contracts do not include a significant financing component. Costs to Obtain a Contract Our incremental direct costs of obtaining a contract, which consist of sales commissions and incremental fringe benefits, are deferred and amortized over the weighted-average contract term. The incremental costs to obtain a contract, which were previously expensed as incurred under ASC 605, as well as the determination of the amortization period, are derived at a portfolio level and amortized on a straight-line basis. The ending balance of deferred commission costs, which are recorded in Other long-term assets on the Consolidated Balance Sheets, was $21 million and $15 million as of December 31, 2019 and 2018 , respectively. The opening deferred commission balance upon the Company’s transition to ASC 606 as of January 1, 2018 was $12 million . Amortization of deferred commission costs, which are recorded in Selling and Marketing expense on the Consolidated Statements of Operations, was $11 million and $10 million during the years ended December 31, 2019 and 2018 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The components of Inventories, net are as follows (in millions): December 31, December 31, Raw materials $ 128 $ 125 Work in process 4 3 Finished goods 342 392 Total $ 474 $ 520 |
Business Acquisitions
Business Acquisitions | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Business Acquisitions | Business Acquisitions Cortexica On November 5, 2019, the Company acquired 100% of the equity interests in Cortexica Vision Systems Limited (“Cortexica”), a provider of computer vision-based artificial intelligence solutions primarily for the retail industry. The purchase consideration was $7 million , which was primarily allocated to technology-related intangible assets of $4 million and goodwill of $4 million based on the estimated fair values of identifiable assets acquired and liabilities assumed. While we believe these estimates provide a reasonable basis to record the net assets acquired, the purchase price allocation is considered preliminary and subject to adjustment during the measurement period, which is up to one year from the acquisition date. Additionally, we incurred approximately $2 million of acquisition-related costs in 2019, which are included within Acquisition and integration costs on the Consolidated Statements of Operations. The goodwill, which will be non-deductible for tax purposes, has been allocated to the EVM segment and principally relates to the planned expansion of the Cortexica technologies into new markets, industries, and product offerings. Profitect On May 31, 2019, the Company acquired 100% of the equity interests of Profitect, Inc. (“Profitect”), a provider of prescriptive analytics primarily for the retail industry . In acquiring Profitect, the Company seeks to enhance its existing software solutions within the retail industry, with possible future applications in other industries, markets and product offerings. The Profitect acquisition was accounted for under the acquisition method of accounting for business combinations. The total purchase consideration was $ 79 million , which consisted of $75 million in cash paid, net of cash on-hand, and the fair value of the Company’s existing ownership interest in Profitect of $4 million , as remeasured upon acquisition. This remeasurement resulted in a $4 million gain reflected within Other, net on the Consolidated Statements of Operations. Additionally, we incurred $ 13 million of acquisition-related costs in 2019, which primarily consisted of payments to settle Profitect employee stock option awards, as well as third party transaction and advisory fees. Those acquisition-related costs are included within Acquisition and integration costs on the Consolidated Statements of Operations. The Company utilized estimated fair values as of May 31, 2019 to allocate the total purchase consideration to the net tangible and intangible assets acquired and liabilities assumed. The fair value of the net assets acquired was based on a number of estimates and assumptions as well as customary valuation procedures and techniques, principally the excess earnings methodology. While we believe these estimates provide a reasonable basis to record the net assets acquired, the purchase price allocation is considered preliminary and subject to adjustment during the measurement period, which is up to one year from the acquisition date. The primary fair value estimates considered preliminary include identifiable intangible assets and income tax-related items. The preliminary purchase price allocation to assets acquired and liabilities assumed was as follows (in millions): Identifiable intangible assets $ 35 Other assets acquired 4 Deferred tax liabilities (4 ) Other liabilities assumed (10 ) Net Assets Acquired $ 25 Goodwill on acquisition 54 Total purchase consideration $ 79 The $54 million of goodwill, which will be non-deductible for tax purposes, has been allocated to the EVM segment and principally relates to the planned expansion of the Profitect software offerings and technologies into current and new markets, industries and product offerings. The preliminary purchase price allocation to identifiable intangible assets acquired was: Fair Value (in millions) Useful Life (in years) Technology and patents $ 33 8 Customer and other relationships 2 1 Total identifiable intangible assets $ 35 Temptime On February 21, 2019, the Company acquired 100% of the equity interests of Temptime Corporation (“Temptime”), a developer and manufacturer of temperature-monitoring labels and devices. The Company intends to expand Temptime’s product offerings within the healthcare industry, with possible future applications in other industries involving temperature-sensitive products. The Temptime acquisition was accounted for under the acquisition method of accounting for business combinations. The Company paid $180 million in cash , net of cash on-hand, to acquire Temptime. Additionally, we incurred $3 million of acquisition-related costs in 2019, which primarily included third-party transaction and advisory fees that are included within Acquisition and integration costs on the Consolidated Statements of Operations. The Company utilized estimated fair values as of February 21, 2019 to allocate the total consideration paid to the net tangible and intangible assets acquired and liabilities assumed. The fair value of the net assets acquired was based on a number of estimates and assumptions as well as customary valuation procedures and techniques, including the relief from royalty and excess earnings methodologies. While we believe these estimates provide a reasonable basis to record the net assets acquired, the purchase price allocation is considered preliminary and subject to adjustment during the measurement period, which is up to one year from the acquisition date. The primary fair value estimates considered preliminary are income tax-related items. The preliminary purchase price allocation to assets acquired and liabilities assumed was as follows (in millions): Inventory $ 14 Property, plant and equipment 10 Identifiable intangible assets 106 Other assets acquired 13 Deferred tax liabilities (24 ) Other liabilities assumed (12 ) Net Assets Acquired $ 107 Goodwill on acquisition 73 Total purchase consideration $ 180 The $73 million of goodwill, which will be non-deductible for tax purposes, has been allocated to the AIT segment and principally relates to the planned expansion of its product offerings and technologies into current and new markets and industries. The preliminary purchase price allocation to identifiable intangible assets acquired was: Fair Value (in millions) Useful Life (in years) Customer and other relationships $ 79 8 Technology and patents 25 8 Trade Names 2 3 Total identifiable intangible assets $ 106 Xplore On August 14, 2018, the Company acquired Xplore Technologies Corporation (“Xplore”). The Xplore business designs, integrates, markets and sells rugged tablets that are primarily used by industrial, government, and field service organizations. The acquisition of Xplore is intended to expand the Company’s portfolio of mobile computing devices to serve a wider range of customers. The Xplore acquisition was accounted for under the acquisition method of accounting for business combinations. The Company paid $72 million in cash , net of cash on-hand, to acquire Xplore. The final purchase price allocation to assets acquired and liabilities assumed was as follows (in millions): Accounts receivable $ 10 Inventory 22 Identifiable intangible assets 32 Other assets acquired 10 Debt (9 ) Accounts payable (8 ) Deferred revenues (7 ) Other liabilities assumed (7 ) Net Assets Acquired $ 43 Goodwill on acquisition 29 Total consideration $ 72 At closing, in connection with the acquisition, the Company also made a $9 million payment of Xplore debt and $6 million in payments of other Xplore transaction-related obligations. Additionally, we incurred $8 million of acquisition-related costs in 2018, which primarily included third-party transaction and advisory fees, and we incurred $2 million of system integration costs in 2019. These costs are reflected within Acquisition and integration costs on the Consolidated Statements of Operations. The $29 million of goodwill, which will be non-deductible for tax purposes, has been allocated to the EVM segment and principally relates to the planned expansion of the Xplore product offerings into current and new markets. Included within the final purchase price allocation are measurement period adjustments relating to facts and circumstances existing as of the acquisition date, primarily an increase to deferred tax assets and a corresponding decrease to goodwill of $6 million , which were recorded during 2019. The Xplore purchase price allocation was finalized in the second quarter of 2019. The purchase price allocation to identifiable intangible assets acquired was: Fair Value (in millions) Useful Life (in years) Customer and other relationships $ 16 9 Technology and patents 15 7 Trade names 1 3 Total identifiable intangible assets $ 32 The operating results of each acquired company have been included in the Company’s Consolidated Balance Sheets and Statements of Operations beginning on their respective acquisition dates. The Company has not included unaudited proforma results, as if each of these companies had been acquired as of January 1, 2018, as doing so would not yield materially different results. |
Goodwill and Other Intangibles
Goodwill and Other Intangibles | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangibles | Goodwill and Other Intangibles Goodwill Changes in the net carrying value amount of goodwill by segment were as follows (in millions): AIT EVM Total Goodwill as of December 31, 2017 $ 154 $ 2,311 $ 2,465 Xplore acquisition — 35 35 Foreign exchange impact — (5 ) (5 ) Goodwill as of December 31, 2018 $ 154 $ 2,341 $ 2,495 Xplore purchase price allocation adjustments — (6 ) (6 ) Temptime acquisition 73 — 73 Profitect acquisition — 54 54 Cortexica acquisition — 4 4 Foreign exchange impact — 2 2 Goodwill as of December 31, 2019 $ 227 $ 2,395 $ 2,622 See Note 5 , Business Acquisitions for further details related to the Company’s acquisitions and purchase price allocation adjustments. The Company’s goodwill balance consists of five reporting units. The majority of the goodwill relates to the acquisition of the Enterprise Business of Motorola Solutions, Inc. (“Enterprise”). The Company completed its annual goodwill impairment testing during the fourth quarter of 2019 utilizing a quantitative approach. The estimated fair value of each reporting unit exceeded its carrying value by at least 55% . There is risk of future impairment to the extent that an individual reporting unit’s performance does not meet projections. Additionally, if our current assumptions and estimates, including projected revenues and income growth rates, terminal growth rates, competitive and consumer trends, market-based discount rates, and other market factors, are not met, or if other valuation factors outside of our control change unfavorably, the estimated fair value of our reporting units could be adversely affected, leading to a potential impairment in the future. No events occurred during the fiscal years ended 2019, 2018, or 2017 that indicated it was more likely than not that our goodwill was impaired. Other Intangibles, net The balances in Other Intangibles, net consisted of the following (in millions): As of December 31, 2019 As of December 31, 2018 Gross Carrying Amount Accumulated Net Gross Carrying Amount Accumulated Net Amortized intangible assets Technology and patents $ 578 $ (508 ) $ 70 $ 514 $ (470 ) $ 44 Customer and other relationships 575 (371 ) 204 493 (305 ) 188 Trade Names 43 (42 ) 1 41 (41 ) — Total $ 1,196 $ (921 ) $ 275 $ 1,048 $ (816 ) $ 232 Amortization expense was $103 million , $97 million , and $184 million for fiscal years ended 2019, 2018 and 2017 , respectively. Estimated future intangible asset amortization expense is as follows (in millions): Year Ended December 31, 2020 $ 64 2021 60 2022 54 2023 23 2024 23 Thereafter 51 Total $ 275 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment, net is comprised of the following (in millions): December 31, 2019 2018 Buildings $ 63 $ 57 Land 7 7 Machinery and equipment 232 204 Furniture and office equipment 20 18 Software and computer equipment 168 161 Leasehold improvements 84 75 Projects in progress 36 24 610 546 Less accumulated depreciation (351 ) (297 ) Property, plant and equipment, net $ 259 $ 249 Depreciation expense was $72 million , $78 million and $79 million for the years ended December 31, 2019 , 2018 and 2017 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The carrying value of the Company’s investments was $45 million and $25 million as of December 31, 2019 and 2018 , respectively, which are included in Other long-term assets on the Consolidated Balances Sheets. The Company adopted ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”) on January 1, 2018. In conjunction therewith, the Company has elected to measure equity investments without readily determinable fair values at cost, adjusted only for impairment losses or for observable changes in orderly transactions for the identical or similar investment of the same issuer for periods beginning after January 1, 2018. Prior to the adoption of ASU 2016-01, such equity investments were measured at cost, adjusted only for impairment losses. Net gains (losses) related to the Company’s investments, which are included within Other, net on the Consolidated Statements of Operations, were $3 million , $10 million , and $(1) million during the years ended December 31, 2019 , 2018 , and 2017 , respectively. |
Exit and Restructuring Costs
Exit and Restructuring Costs | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring and Related Activities [Abstract] | |
Exit and Restructuring Costs | Exit and Restructuring Costs In the fourth quarter of 2019, the Company committed to certain organizational changes designed to generate operational efficiencies (collectively referred to as the “2019 Productivity Plan”), which are incremental to the Company’s 2017 exit and restructuring program (the “2017 Productivity Plan”). The organizational design changes under the 2019 Productivity Plan will principally occur within the North America and Europe, Middle East, and Africa (“EMEA”) regions, relate primarily to employee severance and related benefits, and are expected to be substantially completed in fiscal 2020. Exit and restructuring charges for the 2019 Productivity Plan were $8 million for the year ended December 31, 2019. Estimated remaining costs to be incurred in fiscal 2020 under the 2019 Productivity Plan are expected to be up to $10 million . The 2017 Productivity Plan, focused on organizational design changes, process improvements, and automation, built upon the exit and restructuring initiatives specific to the October 2014 Enterprise acquisition (the “Acquisition Plan”). The Company substantially completed all initiatives under the 2017 Productivity Plan and the Acquisition Plan in fiscal 2018 and 2017, respectively. Exit and restructuring charges relating to the 2017 Productivity Plan were $2 million , $11 million and $12 million for fiscal 2019, 2018 and 2017, respectively. Exit and restructuring charges relating to the Acquisition Plan were $4 million for fiscal 2017. Cumulative costs associated with the 2017 Productivity Plan and the Acquisition Plan were $25 million and $69 million , respectively, and primarily consisted of severance and related benefits and lease exit costs. As of December 31, 2019, no significant obligations remain with respect to the 2017 Productivity Plan or the Acquisition Plan. The Company’s total remaining obligations under its exit and restructuring programs as of December 31, 2019 were approximately $9 million , which are expected to be settled primarily within the next year and reflected within Accrued liabilities on the Consolidated Balance Sheets. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Financial assets and liabilities are measured using inputs from three levels of the fair value hierarchy in accordance with ASC Topic 820, Fair Value Measurements . Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into the following three broad levels: Level 1: Quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs (e.g. U.S. Treasuries and money market funds). Level 2: Observable prices that are based on inputs not quoted in active markets but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs to the extent possible. In addition, the Company considers counterparty credit risk in the assessment of fair value. The Company’s financial assets and liabilities carried at fair value as of December 31, 2019 , are classified below (in millions): Level 1 Level 2 Level 3 Total Assets: Foreign exchange contracts (1) $ — $ 3 $ — $ 3 Money market investments related to the deferred compensation plan 24 — — 24 Total Assets at fair value $ 24 $ 3 $ — $ 27 Liabilities: Forward interest rate swap contracts (2) $ — $ 13 $ — $ 13 Liabilities related to the deferred compensation plan 24 — — 24 Total Liabilities at fair value $ 24 $ 13 $ — $ 37 The Company’s financial assets and liabilities carried at fair value as of December 31, 2018 , are classified below (in millions): Level 1 Level 2 Level 3 Total Assets: Foreign exchange contracts (1) $ 1 $ 15 $ — $ 16 Forward interest rate swap contracts (2) — 5 — 5 Money market investments related to the deferred compensation plan 17 — — 17 Total Assets at fair value $ 18 $ 20 $ — $ 38 Liabilities: Liabilities related to the deferred compensation plan $ 17 $ — $ — $ 17 Total Liabilities at fair value $ 17 $ — $ — $ 17 (1) The fair value of the foreign exchange contracts is calculated as follows: a. Fair value of regular forward contracts associated with forecasted sales hedges is calculated using the year-end exchange rate adjusted for current forward points. b. Fair value of hedges against net assets is calculated at the year-end exchange rate adjusted for current forward points unless the hedge has been traded but not settled at year end (Level 2). If this is the case, the fair value is calculated at the rate at which the hedge is being settled (Level 1). (2) |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments In the normal course of business, the Company is exposed to global market risks, including the effects of changes in foreign currency exchange rates and interest rates. The Company uses derivative instruments to manage its exposure to such risks and may elect to designate certain derivatives as hedging instruments under ASC 815. The Company formally documents all relationships between designated hedging instruments and hedged items as well as its risk management objectives and strategies for undertaking hedge transactions. The Company does not hold or issue derivatives for trading or speculative purposes. In accordance with ASC 815, the Company recognizes derivative instruments as either assets or liabilities on the Consolidated Balance Sheets and measures them at fair value. The following table presents the fair value of its derivative instruments (in millions): Asset (Liability) Fair Values as of December 31, Balance Sheets Classification 2019 2018 Derivative instruments designated as hedges: Foreign exchange contracts Prepaid expenses and other current assets $ 3 $ 15 Total derivative instruments designated as hedges $ 3 $ 15 Derivative instruments not designated as hedges: Foreign exchange contracts Prepaid expenses and other current assets $ — $ 1 Forward interest rate swaps Prepaid expenses and other current assets — 2 Forward interest rate swaps Other long-term assets — 3 Forward interest rate swaps Accrued liabilities (5 ) — Forward interest rate swaps Other long-term liabilities (8 ) — Total derivative instruments not designated as hedges $ (13 ) $ 6 Total net derivative (liability) asset $ (10 ) $ 21 The following table presents the net (losses) gains from changes in fair values of derivatives that are not designated as hedges (in millions): (Loss) Gain Recognized in Income Year Ended December 31, Statements of Operations Classification 2019 2018 2017 Derivative instruments not designated as hedges: Foreign exchange contracts Foreign exchange loss $ (3 ) $ 1 $ (24 ) Forward interest rate swaps Interest expense, net (19 ) 8 2 Total (loss) gain recognized in income $ (22 ) $ 9 $ (22 ) Activities related to derivative instruments are included within Net cash provided by operating activities on the Statements of Cash Flows. Credit and Market Risk Management Financial instruments, including derivatives, expose the Company to counterparty credit risk of nonperformance and to market risk related to currency exchange rate and interest rate fluctuations. The Company manages its exposure to counterparty credit risk by establishing minimum credit standards, diversifying its counterparties, and monitoring its concentrations of credit. The Company’s counterparties are commercial banks with expertise in derivative financial instruments. The Company evaluates the impact of market risk on the fair value and cash flows of its derivative and other financial instruments by considering reasonably possible changes in interest rates and currency exchange rates. The Company continually monitors the creditworthiness of the customers to which it grants credit terms in the normal course of business. The terms and conditions of the Company’s credit policies are designed to mitigate concentrations of credit risk. The Company’s master netting and other similar arrangements with the respective counterparties allow for net settlement under certain conditions, which are designed to reduce credit risk by permitting net settlement with the same counterparty. We elect to present the assets and liabilities of our derivative financial instruments, for which we have net settlement agreements in place, on a net basis on the Consolidated Balance Sheets. If the derivative financial instruments had been presented gross on the Consolidated Balance Sheets, the asset and liability positions each would have been increased by $3 million and $1 million as of December 31, 2019 and 2018 , respectively. Foreign Currency Exchange Risk Management The Company conducts business on a multinational basis in a wide variety of foreign currencies. Exposure to market risk for changes in foreign currency exchange rates arises from Euro-denominated external revenues, cross-border financing activities between subsidiaries, and foreign currency denominated monetary assets and liabilities. The Company manages its objective of preserving the economic value of non-functional currency denominated cash flows by initially hedging transaction exposures with natural offsets to the fullest extent possible and, once these opportunities have been exhausted, through foreign exchange forward and option contracts, as deemed appropriate. The Company manages the exchange rate risk of anticipated Euro-denominated sales by using forward contracts, which typically mature within twelve months of execution. The Company designates these derivative contracts as cash flow hedges. Unrealized gains and losses on these contracts are deferred in AOCI on the Consolidated Balance Sheets until the contract is settled and the hedged sale is realized. The realized gain or loss is then recorded as an adjustment to Net sales on the Consolidated Statement of Operations. Realized gains (losses) reclassified to Net sales were $42 million , $13 million , and $(8) million for the years ending December 31, 2019 , 2018 and 2017 , respectively. As of December 31, 2019 and 2018 , the notional amounts of the Company’s foreign exchange cash flow hedges were €564 million and €496 million , respectively. The Company has reviewed its cash flow hedges for effectiveness and determined they are highly effective . The Company uses forward contracts, which are not designated as hedging instruments, to manage its exposures related to net assets denominated in foreign currencies. These forward contracts typically mature within one month after execution. Monetary gains and losses on these forward contracts are recorded in income and are generally offset by the transaction gains and losses related to their net asset positions. The notional values and the net fair value of these outstanding contracts were as follows (in millions): December 31, 2019 2018 Notional balance of outstanding contracts: British Pound/U.S. Dollar £ 14 £ 1 Euro/U.S. Dollar € 36 € 45 British Pound/Euro £ — £ 6 Canadian Dollar/U.S. Dollar C$ 1 C$ 6 Australian Dollar/U.S. Dollar A$ 42 A$ 47 Japanese Yen/U.S. Dollar ¥ 264 ¥ 396 Singapore Dollar/U.S. Dollar S$ 19 S$ 7 Mexican Peso/U.S. Dollar Mex$ 115 Mex$ 225 Chinese Yuan/U.S. Dollar ¥ ¥ 71 South African Rand/U.S. Dollar R 42 R 42 Net fair value of assets of outstanding contracts $ — $ 1 The Company’s use of non-designated forward contracts to manage Euro currency exposure is limited, as Euro-denominated borrowings under the Revolving Credit Facility naturally hedge part of such risk. See Note 12 , Long-Term Debt for further discussion of Euro-denominated borrowings. Interest Rate Risk Management The Company’s debt consists of borrowings under a term loan (“Term Loan A”), Revolving Credit Facility, and Receivables Financing Facilities, which bear interest at variable rates plus an applicable margin. See Note 12 , Long-Term Debt for further details related to these borrowings. As a result, the Company is exposed to market risk associated with the variable interest rate payments on these borrowings. The Company manages its exposure to changes in interest rates by utilizing interest rate swaps to hedge this exposure and to achieve a desired proportion of fixed versus floating-rate debt, based on current and projected market conditions. In December 2017, the Company entered into a long-term forward interest rate swap agreement with a notional amount of $800 million to lock into a fixed LIBOR interest rate base for debt facilities subject to monthly interest payments. Under the terms of the agreement, $800 million in variable-rate debt will be swapped for a fixed interest rate with net settlement terms due effective starting in December 2018 and ending in December 2022. During the third quarter of 2019, the Company entered into additional long-term forward interest rate swap agreements with a total notional amount of $800 million , containing net settlements effective starting in December 2022 and ending in August 2024. The additional interest rate swap agreements effectively extend the risk management initiative of the Company to coincide with the maturities of Term Loan A and the Revolving Credit Facility, as amended. The Company’s interest rate swaps are not designated as hedges and changes in fair value are recognized immediately as Interest expense, net on the Consolidated Statements of Operations. The Company previously had a floating-to-fixed interest rate swap, which was designated as a cash flow hedge. This swap was terminated, and hedge accounting treatment was discontinued in 2014. The Company reclassified $2 million and $2 million of losses to Interest expense, net on the Consolidated Statements of Operations during the years ended December 31, 2019 and 2018 , respectively. No losses remain to be amortized as of December 31, 2019 . During the fourth quarter of 2018, the Company terminated three interest rate swaps. The first swap was entered into with a syndicated group of commercial banks for the purpose of fixing the interest rate on the Company’s floating-rate debt. The second swap largely offset the first swap, causing interest payments to again be exposed to rate fluctuations. Neither of these instruments were designated as accounting hedges, with changes in fair value recognized in Interest expense, net on the Consolidated Statements of Operations. The third interest rate swap converted the floating-rate debt to fixed-rate debt and was designated as a cash flow hedge. As part of the termination, the Company settled all three swaps resulting in a $7 million cash payment to counterparties that was classified within Net cash provided by operating activities. Hedge accounting treatment was discontinued on the third swap, which had less than $1 million |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt The following table shows the carrying value of the Company’s debt (in millions): December 31, 2019 2018 Term Loan A $ 917 $ 608 Term Loan B — 445 Revolving Credit Facility 103 408 Receivables Financing Facilities 266 139 Total debt $ 1,286 $ 1,600 Less: Debt issuance costs (6 ) (5 ) Less: Unamortized discounts (3 ) (4 ) Less: Current portion of debt (197 ) (157 ) Total long-term debt $ 1,080 $ 1,434 As of December 31, 2019 , the future maturities of debt, excluding debt discounts and issuance costs, are as follows (in millions): 2020 $ 197 2021 99 2022 56 2023 81 2024 853 Thereafter — Total future maturities of debt $ 1,286 All borrowings as of December 31, 2019 were denominated in U.S. Dollars, except for €92 million under the Revolving Credit Facility that was borrowed in Euros. The estimated fair value of our debt approximated $1.3 billion and $1.6 billion as of December 31, 2019 and 2018 , respectively. These fair value amounts, developed based on inputs classified as Level 2 within the fair value hierarchy, represent the estimated value at which the Company’s lenders could trade its debt within the financial markets and does not represent the settlement value of these long-term debt liabilities to the Company. The fair value of the long-term debt will continue to vary each period based a number of factors, including fluctuations in market interest rates as well as changes to the Company’s credit ratings. Credit Facilities On July 26, 2017, the Company entered into an Amended and Restated Credit Agreement which provided for the issuance of Term Loan A and increased funding available under the Revolving Credit Facility to $500 million . In conjunction therewith, the Company partially paid down and repriced Term Loan B. As part of these refinancing activities, the Company capitalized $5 million of debt issuance costs and recorded $6 million of pre-tax charges related to third-party fees for arranger, legal and other services and accelerated amortization of debt issuance costs and discounts within Other, net on the Company’s Consolidated Statements of Operations. During 2017, the Company also fully redeemed $1.1 billion of outstanding principal of other debt obligations which had a scheduled maturity in 2022. In accounting for the early termination, the Company applied debt extinguishment accounting and recognized a $65 million make whole premium and $16 million acceleration of debt issuance costs within Interest expense, net on the Company’s Consolidated Statements of Operations. On May 31, 2018, the Company entered into Amendment No. 1 to the Amended and Restated Credit Agreement (“Amendment No. 1”). Amendment No. 1 resulted in a new Term Loan A with principal of $670 million and increased the Revolving Credit Facility from $500 million to $800 million . Also, as part of Amendment No. 1, the Company had a partial early debt extinguishment of $300 million and repricing of its Term Loan B. Amendment No. 1 resulted in $6 million of non-cash accelerated amortization of debt issuance costs and $1 million of one-time charges related to third party fees, both of which were reflected in Interest Expense, net on the Consolidated Statements of Operations. Amendment No. 1 also resulted in $2 million of third party fees for arranger, legal, and other services that were capitalized. On August 9, 2019, the Company entered into Amendment No. 2 to the Amended and Restated Credit Agreement (“Amendment No. 2”). Amendment No. 2 increased the Company’s borrowing under Term Loan A from $608 million to $1 billion and increased the Company’s borrowing capacity under the Revolving Credit Facility from $800 million to $1 billion . Term Loan A and the Revolving Credit Facility will continue to bear interest at variable rates plus an applicable margin. The maturities of Term Loan A and the Revolving Credit Facility were each extended to August 9, 2024. In conjunction with entering into Amendment No. 2, a payment of $445 million was made to fully pay off Term Loan B. The refinancing of the Company’s debt during the third quarter of 2019 resulted in non-cash accelerated amortization of debt discount and debt issuance costs of $4 million and one-time charges of $3 million , which included certain third party fees and the accelerated amortization of losses on terminated interest rate swaps released from AOCI. These items are included in Interest Expense, net on the Consolidated Statements of Operations. Additionally, issuance costs of $6 million incurred related to this debt refinancing were capitalized and will be amortized over the remaining term of Term Loan A and the Revolving Credit Facility. The principal on Term Loan A is due in quarterly installments, with the next quarterly installment due in July 2021 and the majority due upon its August 9, 2024 maturity. The Company may make prepayments against the amended Term Loan A, in whole or in part, without premium or penalty. The Company would be required to prepay certain outstanding amounts in the event of certain circumstances or transactions. As of December 31, 2019 , the Term Loan A interest rate was 3.01% . Interest payments are made monthly. The Revolving Credit Facility is available for working capital and other general corporate purposes, including letters of credit. As of December 31, 2019 , the Company had letters of credit totaling $5 million , which reduced funds available for borrowings under the agreement from $1 billion to $995 million . As of December 31, 2019 , the Revolving Credit Facility had an average interest rate of 1.25% . Interest payments are made monthly. All remaining principal is due upon the Revolving Credit Facility’s maturity on August 9, 2024. Receivables Financing Facilities In December 2017, the Company entered into a Receivables Financing Facility with a financial institution that has a borrowing limit of up to $180 million . As collateral, the Company pledges a perfected first-priority security interest in its U.S. domestically originated accounts receivable. The Company has accounted for transactions under the Receivables Financing Facility as secured borrowings. As amended during the second quarter of 2019, the Receivables Financing Facility will mature on March 29, 2021 . During the second quarter of 2019, the Company entered into an Additional Receivable Financing Facility with another financial institution, which allows for additional borrowings of up to $100 million , and thus total borrowings of up to $280 million , using U.S. domestically originated accounts receivables as collateral. The Company has also accounted for transactions under this Additional Receivables Financing Facility as secured borrowings. The Additional Receivables Financing Facility will mature on May 18, 2020 . As of December 31, 2019 , the Company’s Consolidated Balance Sheets included $545 million of receivables that were pledged under the two Receivables Financing Facilities. As of December 31, 2019, $266 million had been borrowed, of which $197 million is classified as current. Borrowings under the Receivables Financing Facilities bear interest at a variable rate plus an applicable margin. As of December 31, 2019 , the Receivables Financing Facilities had an average interest rate of 2.60% and require monthly interest payments. Both the Revolving Credit Facility and Receivables Financing Facilities include terms and conditions that limit the incurrence of additional borrowings and require that certain financial ratios be maintained at designated levels. The Company uses interest rate swaps to manage the interest rate risk associated with its debt. See Note 11 , Derivative Instruments for further information. As of December 31, 2019 , the Company was in compliance with all debt covenants. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company leases certain manufacturing facilities, distribution centers, sales and administrative offices, equipment, and vehicles, which are accounted for as operating leases. Remaining lease terms are up to 13 years, with certain leases containing renewal options. The following table presents activities associated with our operating leases during the year ended December 31, 2019 (in millions): Fixed lease expenses $ 37 Variable lease expenses 29 Total lease expenses $ 66 Cash paid for leases $ 67 ROU assets obtained in exchange for lease obligations $ 42 Reduction of ROU assets and lease liabilities (16 ) Net non-cash increases to ROU assets and lease liabilities $ 26 The variable lease expenses incurred during the year were not included in the measurement of the Company’s ROU assets and lease liabilities. Variable lease expenses consisted primarily of distribution center service costs that were based on product distribution volumes, as well as non-fixed common area maintenance, real estate taxes, and other operating costs associated with various facility leases. Expenses incurred during the year related to short term leases were not significant. Cash payments for operating leases are included within Net cash provided by operating activities on the Consolidated Statements of Cash Flows. ROU assets obtained in exchange for lease obligations includes new lease arrangements entered into by the Company during the year, as well as lease arrangements obtained through acquisitions. Additionally, ROU assets obtained in exchange for lease obligations include contract modifications that occurred during the year, as well as changes in assessments made during the year rendering it reasonably certain that lease renewal options will be exercised based on facts and circumstances that arose during the year. Reductions in the Company’s ROU assets and lease liabilities were primarily related to a modification to one of the Company’s distribution center lease agreements during the fourth quarter of 2019, resulting in a reduction to fixed future lease payments. That amendment is not, however, expected to significantly affect total future lease costs, inclusive of variable lease payments. As of December 31, 2019 , the weighted average remaining term of the Company’s operating leases was approximately 6 years, and the weighted average discount rate used to measure the ROU assets and lease liabilities was approximately 6% . Future minimum lease payments under non-cancellable operating leases as of December 31, 2019 were as follows (in millions): 2020 $ 36 2021 30 2022 24 2023 20 2024 15 Thereafter 27 Total future minimum lease payments $ 152 Less: Interest (23 ) Present value of lease liabilities $ 129 Reported as of December 31, 2019: Current portion of lease liabilities $ 29 Long-term lease liabilities 100 Present value of lease liabilities $ 129 The current portion of lease liabilities is included within Accrued liabilities on the Consolidated Balance Sheets. Rent expense under the Company’s operating leases during the years ended December 31, 2018 and 2017, prior to the Company’s adoption of ASC 842, was $33 million and $34 million , respectively. The Company’s total future minimum lease obligations under non-cancellable operating leases as of December 31, 2018 was comparable to those as of December 31, 2019. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Warranties The following table is a summary of the Company’s accrued warranty obligations (in millions): Year Ended December 31, Warranty Reserve 2019 2018 2017 Balance at the beginning of the year $ 22 $ 18 $ 21 Acquisitions — 1 — Warranty expense 25 34 28 Warranties fulfilled (26 ) (31 ) (31 ) Balance at the end of the year $ 21 $ 22 $ 18 Contingencies The Company is subject to a variety of investigations, claims, suits, and other legal proceedings that arise from time to time in the ordinary course of business, including but not limited to, intellectual property, employment, tort, and breach of contract matters. The Company currently believes that the outcomes of such proceedings, individually and in the aggregate, will not have a material adverse impact on its business, cash flows, financial position, or results of operations. Any legal proceedings are subject to inherent uncertainties, and the Company’s view of these matters and its potential effects may change in the future. During 2018, the Company settled in its entirety a commercial lawsuit resulting in a $13 million |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation On May 17, 2018, shareholders approved the Zebra Technologies Corporation 2018 Long-Term Incentive Plan (“2018 Plan”). The 2018 Plan superseded and replaced the Zebra Technologies Corporation 2015 Long-Term Incentive Plan (“2015 Plan”) on the approval date, except that the 2015 Plan remains in effect with respect to outstanding awards under the 2015 Plan until such awards have been exercised, forfeited, canceled, expired or otherwise terminated in accordance with their terms. Together, the 2018 Plan and 2015 Plan provide for incentive compensation to the Company’s non-employee directors, officers, and employees. The awards available under the plans include stock appreciation rights, restricted stock awards, performance share awards, cash-settled stock appreciation rights, restricted stock units, performance stock units, incentive stock options, and non-qualified stock options. The Company uses outstanding treasury shares as its source for issuing shares under the share-based compensation programs. A summary of the equity awards available for future grants under the 2018 Plan is as follows: Available for future grants as of December 31, 2018 3,789,800 Granted (304,840 ) Available for future grants as of December 31, 2019 3,484,960 The compensation expense from the Company’s share-based compensation plans and associated income tax benefit, excluding the effects of excess tax benefits or shortfalls, were included in the Consolidated Statements of Operations as follows (in millions): Year Ended December 31, Compensation costs and related income tax benefit 2019 2018 2017 Cost of sales $ 4 $ 4 $ 3 Selling and marketing 17 13 8 Research and development 16 15 11 General and administration 23 21 16 Total compensation expense $ 60 $ 53 $ 38 Income tax benefit $ 9 $ 10 $ 11 As of December 31, 2019 , total unearned compensation costs related to the Company’s share-based compensation plans was $62 million , which will be amortized to expense over the weighted average remaining service period of 1.4 years . Stock Appreciation Rights (“SARs”) Upon exercise of SARs, the Company issues whole shares of Class A Common Stock to participants based on the difference between the fair market value of the stock at the time of exercise and the exercise price. Fractional shares are settled in cash upon exercise. The grant date fair value of SARs is expensed over the 4 -year vesting period of the related awards. A summary of the Company’s SARs outstanding is as follows: 2019 2018 2017 SARs SARs Weighted- SARs Weighted- SARs Weighted- Outstanding at beginning of year 1,261,185 $ 75.71 1,817,991 $ 65.73 1,740,786 $ 56.15 Granted 70,141 205.12 88,042 149.75 402,029 98.87 Exercised (395,015 ) 66.82 (598,249 ) 55.93 (250,326 ) 48.66 Forfeited (39,388 ) 92.72 (46,161 ) 80.41 (66,550 ) 75.38 Expired — — (438 ) 108.20 (7,948 ) 108.20 Outstanding at end of year 896,923 $ 89.05 1,261,185 $ 75.71 1,817,991 $ 65.73 Exercisable at end of year 489,357 $ 70.37 595,086 $ 60.85 874,942 $ 50.86 The fair value of share-based compensation is estimated on the date of grant using a binomial model. Volatility is based on an average of the implied volatility in the open market and the annualized volatility of the Company’s stock price over its entire stock history. The following table shows the weighted-average assumptions used for grants of SARs, as well as the fair value of the grants based on those assumptions: 2019 2018 2017 Expected dividend yield 0% 0% 0% Forfeiture rate 8.20% 8.40% 9.37% Volatility 36.79% 35.93% 35.49% Risk free interest rate 2.28% 2.96% 1.77% Expected weighted-average life (in years) 4.02 4.11 4.13 Weighted-average grant date fair value of SARs granted $64.17 $47.63 $29.86 The following table summarizes information about SARs outstanding as of December 31, 2019 : Outstanding Exercisable Aggregate intrinsic value (in millions) $ 149 $ 91 Weighted-average remaining contractual term (in years) 4.9 4.5 The intrinsic value for SARs exercised during fiscal 2019 , 2018 and 2017 was $58 million , $59 million and $14 million , respectively. The total fair value of SARs vested during fiscal 2019 , 2018 and 2017 was $9 million , $12 million and $8 million , respectively. Restricted Stock Awards (“RSAs”) and Performance Share Awards (“PSAs”) The Company’s restricted stock grants consist of time-vested RSAs and PSAs, which hold voting rights and therefore are considered participating securities. The outstanding RSAs and PSAs are included as part of the Company’s Class A Common Stock outstanding. The RSAs and PSAs vest at each vesting date, subject to restrictions such as continuous employment, except in certain cases as set forth in each stock agreement. Upon vesting, RSAs and PSAs are released to holders and are no longer subject to restrictions. The Company’s RSAs and PSAs are expensed over the vesting period of the related award, which is typically 3 years . Some awards, including those granted annually to non-employee directors, such as an equity retainer fee, vest upon grant. PSA targets are set based on certain Company-wide financial metrics. Compensation cost is calculated as the market date fair value of the Company’s Class A Common Stock on grant date multiplied by the number of shares granted, net of estimated forfeitures. The Company also issues stock awards to non-employee directors. Each director receives an equity grant of shares annually in the month of May. The number of shares granted to each director is determined by dividing the value of the annual grant by the price of a share of the Company’s Class A Common Stock. New directors in any fiscal year earn a prorated amount. During fiscal 2019 , there were 7,371 shares granted to non-employee directors compared to 7,980 and 12,488 shares granted during fiscal 2018 and 2017 , respectively. The shares vest immediately upon the grant date. A summary of information relative to the Company’s RSAs is as follows: 2019 2018 2017 Restricted Stock Awards Shares Weighted-Average Shares Weighted-Average Shares Weighted-Average Outstanding at beginning of year 657,724 $ 93.45 628,642 $ 77.70 622,814 $ 70.19 Granted 170,502 204.26 206,922 150.60 199,629 98.90 Released (372,075 ) 73.71 (154,878 ) 107.22 (165,846 ) 75.90 Forfeited (21,510 ) 141.29 (22,962 ) 88.77 (27,955 ) 72.81 Outstanding at end of year 434,641 $ 151.52 657,724 $ 93.45 628,642 $ 77.70 The fair value of each PSA granted includes assumptions around the Company’s performance goals. A summary of information relative to the Company’s PSAs is as follows: 2019 2018 2017 Performance Share Awards Shares Weighted-Average Shares Weighted-Average Shares Weighted-Average Outstanding at beginning of year 259,727 $ 86.41 265,747 $ 77.04 379,226 $ 70.14 Granted 150,224 206.04 59,849 146.83 79,423 98.97 Released (231,513 ) 120.86 (57,074 ) 107.31 (2,029 ) 62.70 Forfeited (7,689 ) 102.42 (8,795 ) 81.07 (190,873 ) 73.09 Outstanding at end of year 170,749 $ 144.47 259,727 $ 86.41 265,747 $ 77.04 Other Award Types The Company also has cash-settled compensation awards, including cash-settled stock appreciation rights, restricted stock units and performance stock units, which are expensed over the vesting period of the related award, which is up to 4 years. Compensation cost is calculated at the fair value on grant date multiplied by the number of share-equivalents granted, and the fair value is remeasured at the end of each reporting period based on the Company’s stock price. Cash settlement is based on the fair value of share equivalents at the time of vesting, which was $6 million , $2 million and $2 million in 2019 , 2018 and 2017 , respectively. Share-equivalents issued under these programs totaled 17,207 , 20,393 and 45,781 in fiscal 2019 , 2018 and 2017 , respectively. Non-qualified Stock Options A summary of the Company’s non-qualified options outstanding under the Company’s 2006 Long-Term Incentive Plan is as follows: 2019 2018 2017 Non-qualified Options Shares Weighted- Shares Weighted- Shares Weighted- Outstanding at beginning of year — $ — 15,705 $ 26.34 154,551 $ 35.96 Granted — — — — — — Exercised — — (15,705 ) 26.34 (132,905 ) 36.86 Forfeited — — — — — — Expired — — — — (5,941 ) 41.25 Outstanding at end of year — $ — — $ — 15,705 $ 26.34 Exercisable at end of year — $ — — $ — 15,705 $ 26.34 The last remaining non-qualified stock options were exercised in 2018 . The intrinsic value for non-qualified options exercised in fiscal 2018 and 2017 was $2 million and $8 million , respectively. Cash received from the exercise of non-qualified options was less than $1 million and approximately $5 million during fiscal 2018 and 2017 , respectively. The related income tax benefit realized was $2 million and $2 million during fiscal 2018 and 2017 , respectively. No non-qualified options vested during fiscal 2019 , 2018 or 2017 , as all such options had previously become fully vested. Employee Stock Purchase Plan The Zebra Technologies Corporation 2011 Employee Stock Purchase Plan (“2011 Plan”) permits eligible employees to purchase common stock at 95% of the fair market value at the date of purchase. Employees may make purchases by cash or payroll deductions up to certain limits. The aggregate number of shares that may be purchased under the 2011 Plan is 1,500,000 shares. As of December 31, 2019 , 774,186 shares were available for future purchase. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The geographical sources of income (loss) before income taxes were as follows (in millions): Year Ended December 31, 2019 2018 2017 United States $ 83 $ (25 ) $ (152 ) Outside United States 515 549 240 Total $ 598 $ 524 $ 88 Income tax expense (benefit) consisted of the following (in millions): Year Ended December 31, 2019 2018 2017 Current: Federal $ 16 $ 20 $ 10 State (1 ) 3 8 Foreign 81 77 62 Total current $ 96 $ 100 $ 80 Deferred: Federal (32 ) (11 ) 20 State (5 ) 5 (10 ) Foreign (5 ) 9 (19 ) Total deferred $ (42 ) $ 3 $ (9 ) Total $ 54 $ 103 $ 71 The Company’s effective tax rates were 9.0% , 19.7% and 80.7% for the years ended December 31, 2019 , 2018 and 2017 , respectively. A reconciliation of the U.S. federal statutory income tax rate to our actual income tax rate is provided below: Year Ended December 31, 2019 2018 2017 Provision computed at statutory rate 21.0 % 21.0 % 35.0 % U.S. Tax Reform - one-time transition tax — (0.6 ) 41.8 Remeasurement of deferred taxes 0.2 0.7 (56.0 ) Change in valuation allowance (1.7 ) (4.5 ) 96.4 U.S. impact of Enterprise acquisition 1.0 1.1 12.9 Change in contingent income tax reserves (3.3 ) 3.2 14.0 Foreign earnings subject to U.S. taxation 1.8 2.0 2.0 Foreign rate differential (0.7 ) (2.0 ) (29.1 ) Intra-entity transactions — — (18.8 ) State income tax, net of federal tax benefit (0.2 ) 0.8 (5.3 ) Tax credits (2.3 ) (1.9 ) (5.7 ) Equity compensation deductions (4.0 ) (2.0 ) (5.6 ) Return to provision and other true ups (2.0 ) 1.1 (3.2 ) Other (0.8 ) 0.8 2.3 Provision for income taxes 9.0 % 19.7 % 80.7 % For the year ended December 31, 2019, the Company’s effective tax rate was lower than the federal statutory rate of 21% primarily due to the favorable impacts of share-based compensation benefits, lapses of the statute of limitations on uncertain tax positions, and the generation of tax credits. These benefits were partially offset by the impacts of foreign earnings and deemed royalties taxed in the U.S. For the year ended December 31, 2018, the Company’s effective tax rate was lower than the federal statutory rate of 21% primarily due to lower tax rates in foreign jurisdictions and the generation of tax credits. These benefits were partially offset by increases related to foreign earnings subject to U.S. taxation, the U.S. impact of the Enterprise acquisition and certain discrete items. The discrete items included the favorable impacts of reductions in valuation allowances and share-based compensation benefits, which were offset by audit settlements with the U.S. Internal Revenue Service for the fiscal years 2013, 2014, and 2015 and an increase in uncertain tax positions resulting from interpretive guidance issued during the year. For the year ended December 31, 2017, the Company’s effective tax rate was higher than the federal statutory rate of 35%, primarily due to an increase in valuation allowance on foreign deferred tax assets, the one-time transition tax and remeasurement of net U.S. deferred tax assets under the Act, the U.S. impact of the Enterprise acquisition, and an increase in uncertain tax benefits. These expenses were partially offset by remeasurement of foreign net deferred tax assets, the benefit of lower tax rates in foreign jurisdictions, the recognition of deferred tax assets on intercompany asset transfers, the generation of tax credits and share-based compensation benefits. The Company earns a significant amount of its operating income outside of the U.S., primarily in the United Kingdom, Singapore, and Luxembourg, with statutory rates of 19% , 17% , and 25% , respectively. During 2018, the Company applied for and was granted a second extension of its incentivized tax rate by the Singapore Economic Development Board. The incentive reduces the income tax rate to 10.5% from the statutory rate of 17% and is effective for calendar years 2019 to 2023. The Company has committed to making additional investments in Singapore over the period 2019 to 2022; should the Company not make these investments in accordance with the agreement, any incentive benefit would have to be repaid to the Singapore tax authorities. Tax effects of temporary differences that resulted in deferred tax assets and liabilities are as follows (in millions): December 31, 2019 2018 Deferred tax assets: Capitalized research expenditures $ 37 $ 28 Deferred revenue 24 21 Tax credits 29 28 Net operating loss carryforwards 410 394 Other accruals 21 20 Inventory items 18 20 Capitalized software costs 2 8 Sales return/rebate reserve 48 41 Share-based compensation expense 12 15 Accrued bonus 7 3 Unrealized gains and losses on securities and investments 4 — Valuation allowance (421 ) (56 ) Total deferred tax assets $ 191 $ 522 Deferred tax liabilities: Depreciation and amortization 62 411 Unrealized gains and losses on securities and investments — 2 Undistributed earnings 2 3 Total deferred tax liabilities $ 64 $ 416 Net deferred tax assets $ 127 $ 106 In 2019, the Company reorganized its Luxembourg holding company structure which resulted in a taxable gain in Luxembourg that was offset by operating loss carryforwards. There was no net impact to the Provision for income taxes as these activities also resulted in the realization of deferred tax liabilities related to depreciation and amortization and a corresponding increase in valuation allowances. As of December 31, 2019 , the Company had approximately $410 million (tax effected) of net operating losses (“NOLs”) and approximately $29 million of credit carryforwards. Approximately $161 million of NOLs will expire beginning in 2020 through 2033, and $15 million of credits will expire beginning in 2023 through 2032, with the remaining amounts of NOLs and credit carryforwards having no expiration dates. Impact of U.S. Tax Reform Overview Enacted on December 22, 2017, the Act reduced the U.S. federal corporate tax rate from 35% to 21%, requiring companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred. Based on current operations, the Company is subject to the GILTI, BEAT and FDII provisions of the Act, for which we recorded income tax expense of $12 million and $10 million for the years ended December 31, 2019 and 2018, respectively. We are not currently subject to the new limitation which defers U.S. interest deductions in excess of 30% of adjusted taxable income. However, the application of the interest limitations may apply in the future, depending on changes in the Company’s business model. Additionally, the Company is no longer able to deduct performance-based compensation for its covered employees which exceeds the limitation under amended Internal Revenue Code Section 162(m). These impacts are included in the calculation of the Company’s effective tax rate. Foreign Tax Effects As part of the Act, the Company recognized a one-time transition tax based on its total post-1986 earnings and profits that were previously deferred from U.S. income taxes and recorded a provision related to deemed foreign inclusions through December 31, 2017 as a result of the transition tax. As of December 31, 2019, the Company is no longer permanently reinvested with respect to its U.S. directly-owned foreign subsidiary earnings. For periods after 2017, the Company is subject to U.S. income tax on substantially all foreign earnings under the GILTI provisions of the Act, while any remaining foreign earnings are eligible for the new dividends received deduction. As a result, future repatriation of earnings will no longer be subject to U.S. income tax but may be subject to currency translation gains or losses. Where required, the Company has recorded a deferred tax liability for foreign withholding taxes on current earnings. Additionally, gains and losses on any future taxable dispositions of U.S.-owned foreign affiliates continue to be subject to U.S. income tax. Thus, as a result of these changes, the assertion of permanent reinvestment is no longer applicable under current U.S. tax laws. The Company has not recognized deferred tax liabilities in the U.S. with respect to its outside basis differences in its directly-owned foreign affiliates. It is not practicable to determine the amount of unrecognized deferred tax liabilities on these indefinitely reinvested earnings. Performance-Based Executive Compensation The Act amended the rules related to the exclusion of performance-based compensation under Internal Revenue Code 162(m). The Company is no longer be able to claim a deduction for compensation accrued after January 1, 2018 for any covered employee exceeding $1 million , unless the compensation is earned in relation to a binding contract in existence on November 2, 2017 (“Grandfathered Contracts”). The Company has remeasured the Section 162(m)-grandfathered deferred tax assets at 21% for its covered employees for equity award agreements issued and executed prior to November 2, 2017. Additionally, the Company has determined that its short-term bonus plan does not qualify for the grandfathered contract provisions, and thus any associated deferred tax assets have been derecognized. Provisional and Final Effects During 2017, the Company provisionally recognized an income tax expense of $72 million associated with the Act, including a one-time transition tax of $37 million and $35 million remeasurement of its net U.S. deferred tax assets based on the federal statutory rate of 21% . During 2018, the Company finalized its analysis of the Act, including the one-time transition tax and measurement of net deferred tax assets, and recorded a $3 million income tax benefit as a result of differences between its final analysis and provisional analysis from the prior year. The final analysis included both federal and state tax effects based on legislative pronouncements through December 31, 2018. The Company also utilized a total of $28 million of available net operating losses, research and development credits, alternative minimum tax credits, and foreign tax credits in order to reduce its future cash payments for the one-time transition tax. During 2019, there were no retroactive law changes that impacted the 2018 reassessment. Unrecognized tax benefits A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions): Year ended December 31, 2019 2018 Balance at beginning of year $ 50 $ 51 Additions for tax positions related to the current year 1 1 Additions for tax positions related to prior years — 22 Reductions for tax positions related to prior years (5 ) (11 ) Settlements for tax positions (16 ) (13 ) Lapse of statutes (20 ) — Balance at end of year $ 10 $ 50 As of December 31, 2019 and December 31, 2018 , there were $9 million and $48 million , respectively, of unrecognized tax benefits that, if recognized, would affect the annual effective tax rate. The Company is currently undergoing U.S. federal income tax audits for the tax years 2016 and 2017. Fiscal 2004 through 2018 remain open to examination by multiple foreign and U.S. state taxing jurisdictions. In the fourth quarter of fiscal 2019, the Company settled and made payment for a tax dispute for $19 million . Additionally, the statute of limitations on the U.S. federal income tax audit years 2013, 2014 and 2015 lapsed, resulting in a total benefit of $20 million during fiscal 2019. As of December 31, 2019, no other significant uncertain tax positions are expected to be settled within the next twelve months. Due to uncertainties in any tax audit or litigation outcome, the Company’s estimates of the ultimate settlement or other uncertain tax positions may change and the actual tax benefits may differ significantly from estimates. The Company recognized $6 million , $8 million and $2 million of interest and penalties related to income tax matters as part of Income tax expense on the Consolidated Statements of Operations for the years ended December 31, 2019 , 2018 and 2017 , respectively. The Company had included $8 million and $14 million of estimated interest and penalty obligations within Income taxes payable on the Consolidated Balance Sheets as of December 31, 2019 and 2018 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic net earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average number of shares assuming dilution. Dilutive common shares outstanding is computed using the Treasury Stock method and, in periods of income, reflects the additional shares that would be outstanding if dilutive stock options were exercised for common shares during the period. Earnings per share (in millions, except share data): Year Ended December 31, 2019 2018 2017 Basic: Net income $ 544 $ 421 $ 17 Weighted-average shares outstanding 53,991,249 53,591,655 53,021,761 Basic earnings per share $ 10.08 $ 7.86 $ 0.33 Diluted: Net income $ 544 $ 421 $ 17 Weighted-average shares outstanding 53,991,249 53,591,655 53,021,761 Dilutive shares 603,168 708,157 667,071 Diluted weighted-average shares outstanding 54,594,417 54,299,812 53,688,832 Diluted earnings per share $ 9.97 $ 7.76 $ 0.32 Anti-dilutive options to purchase common shares are excluded from diluted earnings per share calculations. Anti-dilutive options consist primarily of SARs with an exercise price greater than the average market closing price of the Class A Common Stock. There were 47,240 , 72,856 , and 259,142 shares that were anti-dilutive for the years ended December 31, 2019 , 2018 , and 2017 , respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Stockholders’ equity includes certain items classified as AOCI, including: • Unrealized gain (loss) on anticipated sales hedging transactions relates to derivative instruments used to hedge the exposure related to currency exchange rates for forecasted Euro sales. These hedges are designated as cash flow hedges, and the Company defers income statement recognition of gains and losses until the hedged transaction occurs. See Note 11 , Derivative Instruments for more details. • Unrealized gain (loss) on forward interest rate swaps hedging transactions refers to the hedging of the interest rate risk exposure associated with the Company’s variable rate debt. As a result of the Company’s debt refinancing during the third quarter of 2019, remaining losses associated with terminated interest rate swaps were recognized as a component of Interest expense, net on the Consolidated Statements of Operations. See Note 12 , Long-Term Debt for more details. • Foreign currency translation adjustments relate to the Company’s non-U.S. subsidiary companies that have designated a functional currency other than the U.S. Dollar. The Company is required to translate the subsidiary functional currency financial statements to U.S. Dollars using a combination of historical, period-end, and average foreign exchange rates. This combination of rates creates the foreign currency translation adjustment component of AOCI. The changes in each component of AOCI during the three years ended December 31, 2019, 2018 and 2017 were as follows (in millions): Unrealized gain (loss) on sales hedging Unrealized gain (loss) on forward interest rate swaps Foreign currency translation adjustments Total Balance at December 31, 2016 $ 6 $ (15 ) $ (36 ) $ (45 ) Other comprehensive (loss) income before reclassifications (26 ) 1 2 (23 ) Amounts reclassified from AOCI (1) 8 8 — 16 Tax effect 3 (3 ) — — Other comprehensive loss (income), net of tax (15 ) 6 2 (7 ) Balance at December 31, 2017 (9 ) (9 ) (34 ) (52 ) Other comprehensive income (loss) before reclassifications 38 8 (13 ) 33 Amounts reclassified from AOCI (1) (13 ) 4 — (9 ) Tax effect (4 ) (3 ) — (7 ) Other comprehensive income (loss), net of tax 21 9 (13 ) 17 Balance at December 31, 2018 12 — (47 ) (35 ) Other comprehensive income before reclassifications 30 — 1 31 Amounts reclassified from AOCI (1) (42 ) 2 — (40 ) Tax effect 2 (2 ) — — Other comprehensive income (loss), net of tax (10 ) — 1 (9 ) Balance at December 31, 2019 $ 2 $ — $ (46 ) $ (44 ) (1) See Note 11 , Derivative Instruments regarding timing of reclassifications to operating results. |
Accounts Receivable Factoring
Accounts Receivable Factoring | 12 Months Ended |
Dec. 31, 2019 | |
Transfers and Servicing [Abstract] | |
Accounts Receivable Factoring | Accounts Receivable Factoring In 2018, the Company entered into a Receivables Factoring arrangement, pursuant to which certain receivables originated from the EMEA region are sold to a bank in exchange for cash. In the third quarter of 2019, the Company entered into an additional Receivables Factoring arrangement, which provides for additional sales of EMEA-originated receivables to a bank under similar terms. Under these Receivables Factoring arrangements, the Company does not maintain any beneficial interest in the receivables sold. The banks’ purchase of eligible receivables is subject to a maximum of $125 million of uncollected receivables. The Company services the receivables on behalf of the banks, but otherwise maintains no significant continuing involvement with respect to the receivables. Transactions under the Receivables Factoring arrangements are accounted for as sales under ASC 860 with related cash flows reflected in operating cash flows. As of December 31, 2019 and December 31, 2018 there were $60 million and $33 million , respectively, of uncollected receivables that had been sold and removed from the Company’s Consolidated Balance Sheets. In its capacity as servicer of factored receivables, the Company had $33 million of cash collections that were not yet remitted to the banks as of December 31, 2019 due to the timing of collection processing activities. These amounts, whose use is not legally restricted, are included within Accrued liabilities on the Consolidated Balance Sheets and reflected within financing activities on the Consolidated Statements of Cash Flows. No liability existed as of December 31, 2018 . Changes in such unremitted cash collection liabilities are reflected within financing cash flows. Fees incurred in connection with these arrangements were not significant. |
Segment Information and Geograp
Segment Information and Geographic Data | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Information and Geographic Data | Segment Information & Geographic Data Segment results The Company’s operations consist of two reportable segments: Asset Intelligence & Tracking (“AIT”) and Enterprise Visibility & Mobility (“EVM”). The reportable segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker or “CODM”) to assess segment performance and allocate resources among the Company’s segments. The CODM reviews adjusted operating income to assess segment profitability. To the extent applicable, segment operating income excludes purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, and product sourcing diversification costs. Segment assets are not reviewed by the Company’s CODM and therefore are not disclosed below. Financial information by segment is presented as follows (in millions): Year Ended December 31, 2019 2018 2017 Net sales: AIT $ 1,479 $ 1,423 $ 1,311 EVM 3,006 2,795 2,414 Total segment net sales 4,485 4,218 3,725 Corporate, eliminations (1) — — (3 ) Total Net sales $ 4,485 $ 4,218 $ 3,722 Operating income: AIT (2)(3) $ 355 $ 325 $ 274 EVM (2)(3) 483 404 301 Total segment operating income 838 729 575 Corporate, eliminations (4) (146 ) (119 ) (253 ) Total Operating income $ 692 $ 610 $ 322 (1) Amounts included in Corporate, eliminations consist of purchase accounting adjustments related to the Enterprise Acquisition. (2) During 2018, the Company revised its methodology for allocating certain operating expenses across its two reportable segments to more accurately reflect where these operating costs are being incurred. The reallocations relate primarily to facilities, information technology, marketing and human resources expenses. All periods are presented on a comparable basis and reflect these changes which reclassified operating expenses from AIT to EVM of $14 million for the year ended December 31, 2017. There was no impact to the Consolidated Financial Statements as a result of these reallocations. (3) AIT and EVM segment operating income includes depreciation and share-based compensation expense. The amounts of depreciation and share-based compensation attributable expense to AIT and EVM are proportionate to each segment’s Net sales. (4) To the extent applicable, amounts included in Corporate, eliminations consist of purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, and product sourcing diversification costs. Sales to significant customers Our Net sales to significant customers as a percentage of the total Company’s Net sales by segment were as follows: Year Ended December 31, 2019 2018 2017 AIT EVM Total AIT EVM Total AIT EVM Total Customer A 5.3 % 13.0 % 18.3 % 6.2 % 14.1 % 20.3 % 6.3 % 15.0 % 21.3 % Customer B 4.7 % 9.0 % 13.7 % 5.6 % 10.1 % 15.7 % 5.3 % 8.9 % 14.2 % Customer C 6.1 % 10.5 % 16.6 % 6.2 % 7.9 % 14.1 % 6.2 % 7.0 % 13.2 % All three of the above customers are distributors and not end-users. No other customer accounted for 10% or more of total Net sales during the years presented. The Company’s three largest customers accounted for 16.8% , 7.8% , and 20.6% , respectively, of accounts receivable as of December 31, 2019 , and 23.0% , 16.9% and 14.6% , respectively, of accounts receivable as of December 31, 2018 . No other customer accounted for more than 10% of accounts receivable. Geographic data Information regarding the Company’s operations by geographic area is contained in the following tables. Net sales amounts are attributed to geographic area based on customer location. Net sales by region was as follows (in millions): Year Ended December 31, 2019 2018 2017 North America $ 2,261 $ 2,041 $ 1,798 EMEA 1,462 1,409 1,221 Asia-Pacific 518 520 468 Latin America 244 248 235 Total Net sales $ 4,485 $ 4,218 $ 3,722 The United States and Germany were the only countries that accounted for more than 10% of the Company’s net sales in 2019, 2018, and 2017. Net sales during these years was as follows (in millions): Year Ended December 31, 2019 2018 2017 United States $ 2,243 $ 2,020 $ 1,746 Germany 523 523 439 Other 1,719 1,675 1,537 Total Net sales $ 4,485 $ 4,218 $ 3,722 For the year ended December 31, 2019, the Company presented revenues by major country on the same basis as revenues by region, based on customer location. Prior to fiscal 2019, the Company presented revenues by major country based on the country where products, solutions, and services were invoiced from. Revenues by major country for the years ended December 31, 2018 and December 31, 2017 are presented above based on the location of customer, in order to conform to the same basis of presentation as the current year. Geographic data for long-lived assets is as follows (in millions): Year Ended December 31, 2019 2018 2017 North America $ 280 $ 225 $ 238 EMEA 39 14 14 Asia-Pacific 40 7 9 Latin America 7 3 3 Total long-lived assets $ 366 $ 249 $ 264 Long-lived assets are defined by the Company as property, plant and equipment as well as ROU assets. ROU assets were recognized upon adoption of ASC 842 in 2019, prior to which, there were no long-lived assets related to leasing activities. Primarily all of the Company’s long-lived assets in the North America region are located in the United States. |
Supplementary Financial Informa
Supplementary Financial Information | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Supplementary Financial Information | Supplementary Financial Information The components of Accrued liabilities are as follows (in millions): December 31, 2019 2018 Accrued incentive compensation $ 96 $ 127 Customer reserves 44 45 Accrued payroll 63 55 Accrued warranty 21 22 Current portion of lease liabilities 29 — Unremitted cash collections due to banks on factored accounts receivable 33 — Accrued freight and duty 23 7 Accrued other expenses 70 66 Accrued liabilities $ 379 $ 322 Summary of Quarterly Results of Operations (unaudited, in millions): 2019 First Second Third Fourth Total Year Total Net sales $ 1,066 $ 1,097 $ 1,130 $ 1,192 $ 4,485 Gross profit 501 520 535 544 2,100 Net income 115 124 136 169 544 Net earnings per common share: Basic earnings per share: $ 2.14 $ 2.28 $ 2.52 $ 3.13 $ 10.08 Diluted earnings per share: 2.12 2.26 2.50 3.10 9.97 2018 First Second Third Fourth Total Year Net sales $ 977 $ 1,012 $ 1,092 $ 1,137 $ 4,218 Gross profit 465 472 505 539 1,981 Net income 109 70 127 115 421 Net earnings per common share: Basic earnings per share: $ 2.04 $ 1.31 $ 2.37 $ 2.14 $ 7.86 Diluted earnings per share: 2.01 1.29 2.34 2.11 7.76 |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts | Schedule II Valuation and Qualifying Accounts (In millions) Additions Description Balance at Beginning of Period Charged to Costs and Expenses Charged to Other Accounts (1) Deductions Balance at End of Period Valuation account for accounts receivable: Year ended December 31, 2019 $ 3 $ — $ — $ 1 $ 2 Year ended December 31, 2018 3 1 — 1 3 Year ended December 31, 2017 3 1 — 1 3 Valuation account for deferred tax assets: Year ended December 31, 2019 $ 56 $ 6 $ 375 $ 16 $ 421 Year ended December 31, 2018 134 — — 78 56 Year ended December 31, 2017 47 91 — 4 134 (1) This amount relates to our 2019 Luxembourg reorganization activities, which resulted in the realization of deferred tax liabilities related to depreciation and amortization and a corresponding increase in valuation allowances, with no net impact to our provision for income taxes. See Note 16, Income Taxes in the Notes to Consolidated Financial Statements for further information. See accompanying report of independent registered public accounting firm. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation These accompanying consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States and include the accounts of Zebra and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Fiscal Calendar | Fiscal Calendar The Company’s fiscal year is a 52-week period ending on December 31. Interim fiscal quarters end on a Saturday and generally include 13 weeks of operating activity. During the 2019 fiscal year, the Company’s quarter end dates were March 30, June 29, September 28 and December 31. |
Use of Estimates | Use of Estimates These consolidated financial statements were prepared using estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Examples of accounting estimates include: cash flow projections and other valuation assumptions included in business acquisition purchase price allocations as well as annual goodwill impairment testing; the measurement of variable consideration and allocation of transaction price to performance obligations in revenue transactions; inventory and product warranty reserves; useful lives of our tangible and intangible assets; and the recognition and measurement of income tax assets and liabilities. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash consists primarily of deposits with banks. In addition, the Company considers highly liquid short-term investments with original maturities of less than three months to be cash equivalents. These highly liquid short-term investments are readily convertible to known amounts of cash and are so near their maturity that they present insignificant risk of a change in value because of changes in interest rates. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts |
Inventories | Inventories Inventories are stated at the lower of a moving-average cost (which approximates cost on a first-in, first-out basis) and net realizable value. Manufactured inventory cost includes materials, labor, and manufacturing overhead. Purchased inventory cost also includes internal purchasing overhead costs. Raw material inventories largely consist of supplies used in repair operations. Provisions are made to reduce excess and obsolete inventories to their estimated net realizable values. Inventory provisions are based on forecasted demand, experience with specific customers, the age and nature of the inventory, and the ability to redistribute inventory to other programs or to rework into other consumable inventory. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the various classes of property, plant and equipment, which are 30 years for buildings and range from 3 to 10 years for all other asset categories. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or 10 years. |
Leases | Leases The Company recognizes Right-of-Use (“ROU”) assets and lease liabilities for its lease commitments with terms greater than one year. Contractual options to extend or terminate lease agreements are reflected in the lease term when they are reasonably certain to be exercised. The initial measurements of new ROU assets and lease liabilities are based on the present value of future lease payments over the lease term as of the commencement date. In determining future lease payments, the Company has elected not to separate lease and non-lease components. As the Company’s lease arrangements do not provide an implicit interest rate, we apply the Company’s incremental borrowing rate based on the information available at the commencement date in determining the present value of future lease payments. Relevant information used in determining the Company’s incremental borrowing rate includes the duration of the lease, transaction currency of the lease, and the Company’s credit risk relative to risk-free market rates. The Company’s ROU assets also include any initial direct costs incurred and exclude lease incentives. The Company’s lease agreements do not contain any material residual value guarantees or restrictive covenants. All leases of the Company are classified as operating leases, with lease expense being recognized on a straight-line basis. |
Income Taxes | Income Taxes The Company accounts for income taxes under the liability method in accordance with Accounting Standards Codification (“ASC”) 740 Topic, Income Taxes . Accordingly, deferred income taxes are provided for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities for financial reporting and income tax purposes. Deferred tax assets and liabilities are measured using tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is established when necessary to reduce deferred tax assets to the amount that is more likely than not to be realized. The Company recognizes the benefit of tax positions when it is more likely than not to be sustained on its technical merits. The Company recognizes interest and penalties related to income tax matters as part of income tax expense. The Company has elected consolidated tax filings in certain of its jurisdictions which may allow the group to offset one member’s income with losses of other members in the current period and on a carryover basis. The income tax effects of non-inventory intra-entity asset transfers are recognized in the period in which the transfer occurs. The Company classifies its balance sheet accounts by applying jurisdictional netting principles for locations where consolidated tax filing elections are in place. The Tax Cut and Jobs Act (“the Act”, or “U.S. Tax Reform”), enacted on December 22, 2017, contains the Global Intangible Low-Taxed Income (“GILTI”), Base Erosion Anti-Avoidance Tax (“BEAT”), and Deduction for Foreign-Derived Intangible Income (“FDII”) provisions, which relate to the taxation of certain foreign income and are effective for tax years beginning on or after January 1, 2018. The Company recognizes its GILTI, BEAT, and FDII inclusions, when applicable, as a charge to tax expense in the year included in its U.S. tax return. The effects of changes in tax rates and laws on deferred tax balances are recorded in the period of enactment as a component of income tax expense within continuing operations, even if they relate to items recorded within accumulated other comprehensive income (loss) (“AOCI”). The Company elected to not reclassify the tax effects of these changes associated with the Act from AOCI to retained earnings. Such tax effects are released into earnings when the underlying portfolio of assets or liabilities giving rise to the AOCI position are fully derecognized. |
Goodwill | Goodwill Goodwill is not amortized, rather it is tested annually for impairment, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. Our annual impairment testing consists of comparing the estimated fair value of each reporting unit to its carrying value. If the carrying value of a reporting unit exceeds its estimated fair value, goodwill would be considered to be impaired and reduced to its implied fair value. We estimate the fair value of reporting units with valuation techniques, including both the income and market approaches. The income approach requires management to estimate a number of factors for each reporting unit, including projected future operating results, economic projections, anticipated future cash flows and discount rates. The market approach estimates fair value using comparable marketplace fair value data from within a comparable industry group. Fair value determinations require judgment and are sensitive to changes in underlying assumptions, estimates, as well as market factors. Estimating the fair value of reporting units requires that we make a number of assumptions and estimates regarding our long-term growth and cash flow expectations as well as overall industry and economic conditions. These estimates and assumptions include, but are not limited to, projections of revenue and income growth rates, capital investments, competitive and customer trends, appropriate peer group selection, market-based discount rates and other market factors. We performed our annual goodwill impairment testing in the fourth quarter of 2019 using a quantitative approach which did not result in any impairments. See Note 6 , Goodwill and Other Intangibles for additional information. We believe our fair value estimates are reasonable. If actual financial results differ materially from current estimates or there are significant negative changes in market factors beyond our control, there could be an impairment of goodwill in the future. |
Other Intangible Assets | Other Intangible Assets Other intangible assets consist primarily of technology and patent rights, customer and other relationships, and trade names. These assets are recorded at cost and amortized on a straight-line basis over the asset’s useful life which typically range from 3 years to 15 years |
Impairment of Long-lived Assets and Long Lived Assets to be Disposed of | Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of The Company accounts for long-lived assets in accordance with the provisions of ASC Topic 360, Property, Plant and Equipment, which requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the sum of the undiscounted cash flows expected to result from the use and the eventual disposition of the asset. If such assets are impaired, the impairment to be recognized is the excess of the carrying amount over the fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. |
Investments in Equity Securities | Investments in Securities |
Revenue Recognition | Revenue Recognition Revenues are primarily comprised of sales of hardware, services, and supplies. The Company also generates revenues from its solutions and software offerings, primarily licenses and maintenance. Our service offerings are principally product repair and maintenance service contracts, which typically occur over time, and professional services such as installation, integration and provisioning, which typically occur in the early stages of a project. The average life of repair and maintenance service contracts is approximately three years. Professional service arrangements range in duration from a day to several weeks or months. We recognize revenues when we transfer control of promised goods or services to our customers in an amount that reflects the consideration to which we expect to receive, which includes estimates of variable consideration, in exchange for those goods or services. We are typically the principal in all elements of our transactions and record Net sales and Cost of sales on a gross basis. Contract Balances We enter into contract arrangements that may include various combinations of tangible products, services, solution and software offerings, which are generally capable of being distinct and accounted for as separate performance obligations. We evaluate whether two or more contracts should be combined and accounted for as a single contract and whether the combined or single contract has more than one performance obligation. This evaluation requires judgment, and the decision to combine a group of contracts or separate the combined or single contract into multiple distinct performance obligations may impact the amount of revenue recorded in a reporting period. We deem performance obligations to be distinct if the customer can benefit from the product or service on its own or together with readily available resources (“capable of being distinct”) and if the transfer of products or services is separately identifiable from other promises in the contract (“distinct within the context of the contract”). For contract arrangements that include multiple performance obligations, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices for each performance obligation. In general, standalone selling prices are observable for tangible products and software licenses, while standalone selling prices for professional services, repair and maintenance services, and solutions are developed with an expected cost-plus margin or residual approach. When the residual approach cannot be applied, regional pricing, marketing strategies and business practices are evaluated to derive the estimated standalone selling price using a cost-plus margin methodology. The Company recognizes revenue for each performance obligation upon transfer of control of the promised goods or services. Control is deemed to have been transferred when the customer has the ability to direct the use of and has obtained substantially all of the remaining benefits from the goods and services. The determination of whether control transfers at a point in time or over time requires judgment and includes consideration of the following : 1) the customer simultaneously receives and consumes the benefits provided as the Company performs its promises; 2) the Company’s performance creates or enhances an asset that is under control of the customer; 3) the Company’s performance does not create an asset with an alternative use to the Company; and 4) the Company has an enforceable right to payment for its performance completed to date. Substantially all revenue for tangible products and perpetual or term software licenses is recognized at a point in time, which is generally upon shipment, transfer of control and risks of ownership to the customer, and the Company having contractual right to payment. Revenue for services and Company-hosted software license and maintenance agreements, as well as solutions, is predominantly recognized over time. Assuming all other criteria for revenue recognition have been met, for products and services sold on a standalone basis, revenue is generally recognized upon shipment and by using an output method or time-based method, respectively. In cases where a bundle of products and services are delivered to the customer, judgment is required to select the method of progress which best reflects the transfer of control. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined that our contracts do not include a significant financing component. Costs to Obtain a Contract |
Research and Development Costs | Research and Development Costs Research and development (“R&D”) costs are expensed as incurred, and include: • Salaries, benefits, and other R&D personnel related costs; • Consulting and other outside services used in the R&D process; • Engineering supplies; • Engineering related information systems costs; and • Allocation of building and related costs. |
Advertising | Advertising |
Warranties | Warranties In general, the Company provides warranty coverage of one year on mobile computers, printers and batteries. Advanced data capture products are warrantied from one to five years , depending on the product. Thermal printheads are warrantied for six months and battery-based products, such as location tags, are covered by a 90 -day warranty. A provision for warranty expense is adjusted quarterly based on historical and expected warranty experience. |
Contingencies | Contingencies The Company establishes a liability for loss contingencies when the loss is both probable and estimable. In addition, for some matters for which a loss is probable or reasonably possible, an estimate of the amount of loss or range of loss is not possible, and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of non-monetary remedies. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Our financial assets and liabilities that require recognition and fair value measurement under the accounting guidance generally include our employee deferred compensation plan investments, foreign currency forwards, and interest rate swaps. In accordance with ASC Topic 815, Derivatives and Hedging (“ASC 815”) , we recognize derivative instruments and hedging activities as either assets or liabilities on the Consolidated Balance Sheets and measure them at fair value. Gains and losses resulting from changes in fair value are accounted for depending on the use of the derivative and whether it is designated and qualifies for hedge accounting. See Note 11 , Derivative Instruments for additional information on the Company’s derivatives and hedging activities. The Company utilizes foreign currency forwards to hedge certain foreign currency exposures and interest rate swaps to hedge a portion of the variability in future cash flows on debt. We use broker quotations or market transactions, in either the listed or over-the-counter markets, to value our foreign currency exchange contracts and relevant observable market inputs at quoted intervals, such as forward yield curves and the Company’s own credit risk to value our interest rate swaps. The Company’s securities held for its deferred compensation plans are measured at fair value using quoted prices in active markets for identical assets. If active markets for identical assets are not available to determine fair value, then we use quoted prices for similar assets or inputs that are observable either directly or indirectly. |
Share-Based Compensation | Share-Based Compensation The Company has share-based compensation plans and an employee stock purchase plan under which shares of Class A Common Stock are available for future grants and sales. The Company recognizes compensation costs over the vesting period of up to 4 years |
Foreign Currency Translation | Foreign Currency Translation The balance sheet accounts of the Company’s subsidiaries that have not designated the U.S. Dollar as its functional currency are translated into U.S. Dollars using the period-end exchange rate, and statement of earnings items are translated using the average exchange rate for the period. The resulting translation gains or losses are recorded in Stockholders’ equity as a cumulative translation adjustment, which is a component of AOCI within the Consolidated Balance Sheets. |
Acquisitions | Acquisitions We account for acquired businesses using the acquisition method of accounting. This method requires that the purchase price be allocated to the identifiable assets acquired and liabilities assumed at their estimated fair values. The excess of the purchase price over the identifiable assets acquired and liabilities assumed is recorded as goodwill. The estimates used to determine the fair values of long-lived assets, such as intangible assets, can be complex and require judgment. We use information available to us to make fair value determinations and engage independent valuation specialists, when necessary, to assist in the fair value determinations of significant acquired long-lived assets. While we use our best estimates and assumptions as a part of the purchase price allocation process, our estimates are inherently uncertain and subject to refinement during the measurement period, which is up to one year after the acquisition date. Critical estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from revenues and operating activities, customer attrition rates, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but due to the inherent uncertainty during the measurement period, we may record adjustments to the fair value of assets acquired and liabilities assumed with a corresponding adjustment to goodwill. |
Recently Adopted Accounting Pronouncements/Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements On January 1, 2019, the Company adopted ASC Topic 842, Leases (“ASC 842”), which increases the transparency and comparability of organizations by recognizing ROU assets and lease liabilities on the Consolidated Balance Sheets and disclosing key quantitative and qualitative information about leasing arrangements. The principal difference from previous guidance is that the ROU assets and lease liabilities arising from operating leases were not previously recognized on the Consolidated Balance Sheet. Results for reporting periods beginning after January 1, 2019 are reported under ASC 842, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under ASC Topic 840, Leases (“ASC 840”). In transition, we elected a number of practical expedients, including the election to not reassess existing or expired contracts to determine if such contracts contain a lease or if the lease classification would differ, as well as the election to not separate lease and non-lease components for arrangements where the Company is a lessee. The impact of the adoption of ASC 842 to the Company’s Consolidated Balance Sheets as of January 1, 2019 was as follows (in millions): As Reported December 31, 2018 Adjustment As Adjusted January 1, 2019 Assets: Prepaid expenses and other current assets (1) $ 54 $ (1 ) $ 53 Right-of-use assets — 110 110 Liabilities: Accrued liabilities (2) 322 28 350 Long-term lease liabilities — 103 103 Other long-term liabilities (1) 89 (22 ) 67 (1) Reflects an adjustment related to prepaid and accrued rent balances, which are included in the measurement of ROU assets. (2) Reflects the current portion of the lease liabilities. As a result of the transition, there was no impact to the Company’s Consolidated Statements of Operations or Cash Flows for the year ended December 31, 2019 , compared to what would have been reported in accordance with ASC 840. In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . This ASU clarifies existing guidance related to implementation costs incurred in cloud computing arrangements, including the recognition, subsequent measurement, and financial statement presentation of such costs. The standard was early adopted prospectively by the Company during the second quarter of 2019 and did not have a material impact to the Company’s consolidated financial statements or disclosures. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments . The ASU requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. It replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. With respect to the Company’s financial assets, including trade receivables and contract assets, a cumulative effect transition approach will be applied. The standard will be effective for the Company in the first quarter of 2020. Management has assessed the impact of the ASU and determined, based on current operations, that it will not have a material impact to the Company’s consolidated financial statements or disclosures. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Impact of the Adoption of ASC 842 | The impact of the adoption of ASC 842 to the Company’s Consolidated Balance Sheets as of January 1, 2019 was as follows (in millions): As Reported December 31, 2018 Adjustment As Adjusted January 1, 2019 Assets: Prepaid expenses and other current assets (1) $ 54 $ (1 ) $ 53 Right-of-use assets — 110 110 Liabilities: Accrued liabilities (2) 322 28 350 Long-term lease liabilities — 103 103 Other long-term liabilities (1) 89 (22 ) 67 (1) Reflects an adjustment related to prepaid and accrued rent balances, which are included in the measurement of ROU assets. (2) Reflects the current portion of the lease liabilities. |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents our Net sales disaggregated by product category for each of our segments, Asset Intelligence & Tracking (“AIT”) and Enterprise Visibility & Mobility (“EVM”), for the years ended December 31, 2019 and 2018 (in millions): Year Ended December 31, 2019 Year Ended December 31, 2018 Segment Tangible Products Services and Software Total Tangible Products Services and Software Total AIT $ 1,347 $ 132 $ 1,479 $ 1,298 $ 125 $ 1,423 EVM 2,560 446 3,006 2,387 408 2,795 Total $ 3,907 $ 578 $ 4,485 $ 3,685 $ 533 $ 4,218 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | The components of Inventories, net are as follows (in millions): December 31, December 31, Raw materials $ 128 $ 125 Work in process 4 3 Finished goods 342 392 Total $ 474 $ 520 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of Preliminary and Final Purchase Price Allocation to Assets Acquired and Liabilities Assumed | The preliminary purchase price allocation to assets acquired and liabilities assumed was as follows (in millions): Identifiable intangible assets $ 35 Other assets acquired 4 Deferred tax liabilities (4 ) Other liabilities assumed (10 ) Net Assets Acquired $ 25 Goodwill on acquisition 54 Total purchase consideration $ 79 The final purchase price allocation to assets acquired and liabilities assumed was as follows (in millions): Accounts receivable $ 10 Inventory 22 Identifiable intangible assets 32 Other assets acquired 10 Debt (9 ) Accounts payable (8 ) Deferred revenues (7 ) Other liabilities assumed (7 ) Net Assets Acquired $ 43 Goodwill on acquisition 29 Total consideration $ 72 The preliminary purchase price allocation to assets acquired and liabilities assumed was as follows (in millions): Inventory $ 14 Property, plant and equipment 10 Identifiable intangible assets 106 Other assets acquired 13 Deferred tax liabilities (24 ) Other liabilities assumed (12 ) Net Assets Acquired $ 107 Goodwill on acquisition 73 Total purchase consideration $ 180 |
Schedule of Preliminary Purchase Price Allocation to Identifiable Intangible Assets Acquired | The preliminary purchase price allocation to identifiable intangible assets acquired was: Fair Value (in millions) Useful Life (in years) Technology and patents $ 33 8 Customer and other relationships 2 1 Total identifiable intangible assets $ 35 The purchase price allocation to identifiable intangible assets acquired was: Fair Value (in millions) Useful Life (in years) Customer and other relationships $ 16 9 Technology and patents 15 7 Trade names 1 3 Total identifiable intangible assets $ 32 The preliminary purchase price allocation to identifiable intangible assets acquired was: Fair Value (in millions) Useful Life (in years) Customer and other relationships $ 79 8 Technology and patents 25 8 Trade Names 2 3 Total identifiable intangible assets $ 106 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Net Carrying Value of Goodwill | Changes in the net carrying value amount of goodwill by segment were as follows (in millions): AIT EVM Total Goodwill as of December 31, 2017 $ 154 $ 2,311 $ 2,465 Xplore acquisition — 35 35 Foreign exchange impact — (5 ) (5 ) Goodwill as of December 31, 2018 $ 154 $ 2,341 $ 2,495 Xplore purchase price allocation adjustments — (6 ) (6 ) Temptime acquisition 73 — 73 Profitect acquisition — 54 54 Cortexica acquisition — 4 4 Foreign exchange impact — 2 2 Goodwill as of December 31, 2019 $ 227 $ 2,395 $ 2,622 |
Amortized Intangible Assets | The balances in Other Intangibles, net consisted of the following (in millions): As of December 31, 2019 As of December 31, 2018 Gross Carrying Amount Accumulated Net Gross Carrying Amount Accumulated Net Amortized intangible assets Technology and patents $ 578 $ (508 ) $ 70 $ 514 $ (470 ) $ 44 Customer and other relationships 575 (371 ) 204 493 (305 ) 188 Trade Names 43 (42 ) 1 41 (41 ) — Total $ 1,196 $ (921 ) $ 275 $ 1,048 $ (816 ) $ 232 |
Schedule of Future Amortization Expense | Estimated future intangible asset amortization expense is as follows (in millions): Year Ended December 31, 2020 $ 64 2021 60 2022 54 2023 23 2024 23 Thereafter 51 Total $ 275 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Components of Property, Plant and Equipment | Property, plant and equipment, net is comprised of the following (in millions): December 31, 2019 2018 Buildings $ 63 $ 57 Land 7 7 Machinery and equipment 232 204 Furniture and office equipment 20 18 Software and computer equipment 168 161 Leasehold improvements 84 75 Projects in progress 36 24 610 546 Less accumulated depreciation (351 ) (297 ) Property, plant and equipment, net $ 259 $ 249 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Carried at Fair Value | The Company’s financial assets and liabilities carried at fair value as of December 31, 2019 , are classified below (in millions): Level 1 Level 2 Level 3 Total Assets: Foreign exchange contracts (1) $ — $ 3 $ — $ 3 Money market investments related to the deferred compensation plan 24 — — 24 Total Assets at fair value $ 24 $ 3 $ — $ 27 Liabilities: Forward interest rate swap contracts (2) $ — $ 13 $ — $ 13 Liabilities related to the deferred compensation plan 24 — — 24 Total Liabilities at fair value $ 24 $ 13 $ — $ 37 The Company’s financial assets and liabilities carried at fair value as of December 31, 2018 , are classified below (in millions): Level 1 Level 2 Level 3 Total Assets: Foreign exchange contracts (1) $ 1 $ 15 $ — $ 16 Forward interest rate swap contracts (2) — 5 — 5 Money market investments related to the deferred compensation plan 17 — — 17 Total Assets at fair value $ 18 $ 20 $ — $ 38 Liabilities: Liabilities related to the deferred compensation plan $ 17 $ — $ — $ 17 Total Liabilities at fair value $ 17 $ — $ — $ 17 (1) The fair value of the foreign exchange contracts is calculated as follows: a. Fair value of regular forward contracts associated with forecasted sales hedges is calculated using the year-end exchange rate adjusted for current forward points. b. Fair value of hedges against net assets is calculated at the year-end exchange rate adjusted for current forward points unless the hedge has been traded but not settled at year end (Level 2). If this is the case, the fair value is calculated at the rate at which the hedge is being settled (Level 1). (2) |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value of Derivative Assets and Liabilities | The following table presents the fair value of its derivative instruments (in millions): Asset (Liability) Fair Values as of December 31, Balance Sheets Classification 2019 2018 Derivative instruments designated as hedges: Foreign exchange contracts Prepaid expenses and other current assets $ 3 $ 15 Total derivative instruments designated as hedges $ 3 $ 15 Derivative instruments not designated as hedges: Foreign exchange contracts Prepaid expenses and other current assets $ — $ 1 Forward interest rate swaps Prepaid expenses and other current assets — 2 Forward interest rate swaps Other long-term assets — 3 Forward interest rate swaps Accrued liabilities (5 ) — Forward interest rate swaps Other long-term liabilities (8 ) — Total derivative instruments not designated as hedges $ (13 ) $ 6 Total net derivative (liability) asset $ (10 ) $ 21 |
Net Gains (Losses) from Changes in Fair Values of Derivatives Not Designated as Hedges | The following table presents the net (losses) gains from changes in fair values of derivatives that are not designated as hedges (in millions): (Loss) Gain Recognized in Income Year Ended December 31, Statements of Operations Classification 2019 2018 2017 Derivative instruments not designated as hedges: Foreign exchange contracts Foreign exchange loss $ (3 ) $ 1 $ (24 ) Forward interest rate swaps Interest expense, net (19 ) 8 2 Total (loss) gain recognized in income $ (22 ) $ 9 $ (22 ) |
Schedule of Notional Value and Net Fair Value of Outstanding Contracts | The notional values and the net fair value of these outstanding contracts were as follows (in millions): December 31, 2019 2018 Notional balance of outstanding contracts: British Pound/U.S. Dollar £ 14 £ 1 Euro/U.S. Dollar € 36 € 45 British Pound/Euro £ — £ 6 Canadian Dollar/U.S. Dollar C$ 1 C$ 6 Australian Dollar/U.S. Dollar A$ 42 A$ 47 Japanese Yen/U.S. Dollar ¥ 264 ¥ 396 Singapore Dollar/U.S. Dollar S$ 19 S$ 7 Mexican Peso/U.S. Dollar Mex$ 115 Mex$ 225 Chinese Yuan/U.S. Dollar ¥ ¥ 71 South African Rand/U.S. Dollar R 42 R 42 Net fair value of assets of outstanding contracts $ — $ 1 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Summary of Carrying Value of Debt | The following table shows the carrying value of the Company’s debt (in millions): December 31, 2019 2018 Term Loan A $ 917 $ 608 Term Loan B — 445 Revolving Credit Facility 103 408 Receivables Financing Facilities 266 139 Total debt $ 1,286 $ 1,600 Less: Debt issuance costs (6 ) (5 ) Less: Unamortized discounts (3 ) (4 ) Less: Current portion of debt (197 ) (157 ) Total long-term debt $ 1,080 $ 1,434 |
Schedule of Maturities of Long-term Debt | As of December 31, 2019 , the future maturities of debt, excluding debt discounts and issuance costs, are as follows (in millions): 2020 $ 197 2021 99 2022 56 2023 81 2024 853 Thereafter — Total future maturities of debt $ 1,286 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Activities Associated With Operating Leases | The following table presents activities associated with our operating leases during the year ended December 31, 2019 (in millions): Fixed lease expenses $ 37 Variable lease expenses 29 Total lease expenses $ 66 Cash paid for leases $ 67 ROU assets obtained in exchange for lease obligations $ 42 Reduction of ROU assets and lease liabilities (16 ) Net non-cash increases to ROU assets and lease liabilities $ 26 |
Future Minimum Lease Payments | Future minimum lease payments under non-cancellable operating leases as of December 31, 2019 were as follows (in millions): 2020 $ 36 2021 30 2022 24 2023 20 2024 15 Thereafter 27 Total future minimum lease payments $ 152 Less: Interest (23 ) Present value of lease liabilities $ 129 Reported as of December 31, 2019: Current portion of lease liabilities $ 29 Long-term lease liabilities 100 Present value of lease liabilities $ 129 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Accrued Warranty Obligations | The following table is a summary of the Company’s accrued warranty obligations (in millions): Year Ended December 31, Warranty Reserve 2019 2018 2017 Balance at the beginning of the year $ 22 $ 18 $ 21 Acquisitions — 1 — Warranty expense 25 34 28 Warranties fulfilled (26 ) (31 ) (31 ) Balance at the end of the year $ 21 $ 22 $ 18 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Equity Awards Activity | A summary of the equity awards available for future grants under the 2018 Plan is as follows: Available for future grants as of December 31, 2018 3,789,800 Granted (304,840 ) Available for future grants as of December 31, 2019 3,484,960 |
Schedule of Compensation Expense and Related Income Tax benefit | The compensation expense from the Company’s share-based compensation plans and associated income tax benefit, excluding the effects of excess tax benefits or shortfalls, were included in the Consolidated Statements of Operations as follows (in millions): Year Ended December 31, Compensation costs and related income tax benefit 2019 2018 2017 Cost of sales $ 4 $ 4 $ 3 Selling and marketing 17 13 8 Research and development 16 15 11 General and administration 23 21 16 Total compensation expense $ 60 $ 53 $ 38 Income tax benefit $ 9 $ 10 $ 11 |
Summary of SARs Activity | A summary of the Company’s SARs outstanding is as follows: 2019 2018 2017 SARs SARs Weighted- SARs Weighted- SARs Weighted- Outstanding at beginning of year 1,261,185 $ 75.71 1,817,991 $ 65.73 1,740,786 $ 56.15 Granted 70,141 205.12 88,042 149.75 402,029 98.87 Exercised (395,015 ) 66.82 (598,249 ) 55.93 (250,326 ) 48.66 Forfeited (39,388 ) 92.72 (46,161 ) 80.41 (66,550 ) 75.38 Expired — — (438 ) 108.20 (7,948 ) 108.20 Outstanding at end of year 896,923 $ 89.05 1,261,185 $ 75.71 1,817,991 $ 65.73 Exercisable at end of year 489,357 $ 70.37 595,086 $ 60.85 874,942 $ 50.86 |
Weighted-Average Assumptions Used for Grants of SARs | The following table shows the weighted-average assumptions used for grants of SARs, as well as the fair value of the grants based on those assumptions: 2019 2018 2017 Expected dividend yield 0% 0% 0% Forfeiture rate 8.20% 8.40% 9.37% Volatility 36.79% 35.93% 35.49% Risk free interest rate 2.28% 2.96% 1.77% Expected weighted-average life (in years) 4.02 4.11 4.13 Weighted-average grant date fair value of SARs granted $64.17 $47.63 $29.86 |
Summary of Outstanding and Exercisable Options | The following table summarizes information about SARs outstanding as of December 31, 2019 : Outstanding Exercisable Aggregate intrinsic value (in millions) $ 149 $ 91 Weighted-average remaining contractual term (in years) 4.9 4.5 |
Summary of Restricted Stock Award Activity | A summary of information relative to the Company’s RSAs is as follows: 2019 2018 2017 Restricted Stock Awards Shares Weighted-Average Shares Weighted-Average Shares Weighted-Average Outstanding at beginning of year 657,724 $ 93.45 628,642 $ 77.70 622,814 $ 70.19 Granted 170,502 204.26 206,922 150.60 199,629 98.90 Released (372,075 ) 73.71 (154,878 ) 107.22 (165,846 ) 75.90 Forfeited (21,510 ) 141.29 (22,962 ) 88.77 (27,955 ) 72.81 Outstanding at end of year 434,641 $ 151.52 657,724 $ 93.45 628,642 $ 77.70 |
Summary of Performance Share Award Activity | A summary of information relative to the Company’s PSAs is as follows: 2019 2018 2017 Performance Share Awards Shares Weighted-Average Shares Weighted-Average Shares Weighted-Average Outstanding at beginning of year 259,727 $ 86.41 265,747 $ 77.04 379,226 $ 70.14 Granted 150,224 206.04 59,849 146.83 79,423 98.97 Released (231,513 ) 120.86 (57,074 ) 107.31 (2,029 ) 62.70 Forfeited (7,689 ) 102.42 (8,795 ) 81.07 (190,873 ) 73.09 Outstanding at end of year 170,749 $ 144.47 259,727 $ 86.41 265,747 $ 77.04 |
Summary of Non-qualified Option Activity | A summary of the Company’s non-qualified options outstanding under the Company’s 2006 Long-Term Incentive Plan is as follows: 2019 2018 2017 Non-qualified Options Shares Weighted- Shares Weighted- Shares Weighted- Outstanding at beginning of year — $ — 15,705 $ 26.34 154,551 $ 35.96 Granted — — — — — — Exercised — — (15,705 ) 26.34 (132,905 ) 36.86 Forfeited — — — — — — Expired — — — — (5,941 ) 41.25 Outstanding at end of year — $ — — $ — 15,705 $ 26.34 Exercisable at end of year — $ — — $ — 15,705 $ 26.34 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Geographical Sources of Income (Loss) Before Income Taxes | The geographical sources of income (loss) before income taxes were as follows (in millions): Year Ended December 31, 2019 2018 2017 United States $ 83 $ (25 ) $ (152 ) Outside United States 515 549 240 Total $ 598 $ 524 $ 88 |
Components of Income Tax Expense (Benefit) | Income tax expense (benefit) consisted of the following (in millions): Year Ended December 31, 2019 2018 2017 Current: Federal $ 16 $ 20 $ 10 State (1 ) 3 8 Foreign 81 77 62 Total current $ 96 $ 100 $ 80 Deferred: Federal (32 ) (11 ) 20 State (5 ) 5 (10 ) Foreign (5 ) 9 (19 ) Total deferred $ (42 ) $ 3 $ (9 ) Total $ 54 $ 103 $ 71 |
Reconciliation of U.S. Federal Statutory Income Tax Rate to Actual Income Tax Rate | A reconciliation of the U.S. federal statutory income tax rate to our actual income tax rate is provided below: Year Ended December 31, 2019 2018 2017 Provision computed at statutory rate 21.0 % 21.0 % 35.0 % U.S. Tax Reform - one-time transition tax — (0.6 ) 41.8 Remeasurement of deferred taxes 0.2 0.7 (56.0 ) Change in valuation allowance (1.7 ) (4.5 ) 96.4 U.S. impact of Enterprise acquisition 1.0 1.1 12.9 Change in contingent income tax reserves (3.3 ) 3.2 14.0 Foreign earnings subject to U.S. taxation 1.8 2.0 2.0 Foreign rate differential (0.7 ) (2.0 ) (29.1 ) Intra-entity transactions — — (18.8 ) State income tax, net of federal tax benefit (0.2 ) 0.8 (5.3 ) Tax credits (2.3 ) (1.9 ) (5.7 ) Equity compensation deductions (4.0 ) (2.0 ) (5.6 ) Return to provision and other true ups (2.0 ) 1.1 (3.2 ) Other (0.8 ) 0.8 2.3 Provision for income taxes 9.0 % 19.7 % 80.7 % |
Components of Deferred Tax Assets and Liabilities | Tax effects of temporary differences that resulted in deferred tax assets and liabilities are as follows (in millions): December 31, 2019 2018 Deferred tax assets: Capitalized research expenditures $ 37 $ 28 Deferred revenue 24 21 Tax credits 29 28 Net operating loss carryforwards 410 394 Other accruals 21 20 Inventory items 18 20 Capitalized software costs 2 8 Sales return/rebate reserve 48 41 Share-based compensation expense 12 15 Accrued bonus 7 3 Unrealized gains and losses on securities and investments 4 — Valuation allowance (421 ) (56 ) Total deferred tax assets $ 191 $ 522 Deferred tax liabilities: Depreciation and amortization 62 411 Unrealized gains and losses on securities and investments — 2 Undistributed earnings 2 3 Total deferred tax liabilities $ 64 $ 416 Net deferred tax assets $ 127 $ 106 |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions): Year ended December 31, 2019 2018 Balance at beginning of year $ 50 $ 51 Additions for tax positions related to the current year 1 1 Additions for tax positions related to prior years — 22 Reductions for tax positions related to prior years (5 ) (11 ) Settlements for tax positions (16 ) (13 ) Lapse of statutes (20 ) — Balance at end of year $ 10 $ 50 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computation of Earnings Per Share | Earnings per share (in millions, except share data): Year Ended December 31, 2019 2018 2017 Basic: Net income $ 544 $ 421 $ 17 Weighted-average shares outstanding 53,991,249 53,591,655 53,021,761 Basic earnings per share $ 10.08 $ 7.86 $ 0.33 Diluted: Net income $ 544 $ 421 $ 17 Weighted-average shares outstanding 53,991,249 53,591,655 53,021,761 Dilutive shares 603,168 708,157 667,071 Diluted weighted-average shares outstanding 54,594,417 54,299,812 53,688,832 Diluted earnings per share $ 9.97 $ 7.76 $ 0.32 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | The changes in each component of AOCI during the three years ended December 31, 2019, 2018 and 2017 were as follows (in millions): Unrealized gain (loss) on sales hedging Unrealized gain (loss) on forward interest rate swaps Foreign currency translation adjustments Total Balance at December 31, 2016 $ 6 $ (15 ) $ (36 ) $ (45 ) Other comprehensive (loss) income before reclassifications (26 ) 1 2 (23 ) Amounts reclassified from AOCI (1) 8 8 — 16 Tax effect 3 (3 ) — — Other comprehensive loss (income), net of tax (15 ) 6 2 (7 ) Balance at December 31, 2017 (9 ) (9 ) (34 ) (52 ) Other comprehensive income (loss) before reclassifications 38 8 (13 ) 33 Amounts reclassified from AOCI (1) (13 ) 4 — (9 ) Tax effect (4 ) (3 ) — (7 ) Other comprehensive income (loss), net of tax 21 9 (13 ) 17 Balance at December 31, 2018 12 — (47 ) (35 ) Other comprehensive income before reclassifications 30 — 1 31 Amounts reclassified from AOCI (1) (42 ) 2 — (40 ) Tax effect 2 (2 ) — — Other comprehensive income (loss), net of tax (10 ) — 1 (9 ) Balance at December 31, 2019 $ 2 $ — $ (46 ) $ (44 ) (1) See Note 11 , Derivative Instruments regarding timing of reclassifications to operating results. |
Segment Information and Geogr_2
Segment Information and Geographic Data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Financial Information by Segment | Financial information by segment is presented as follows (in millions): Year Ended December 31, 2019 2018 2017 Net sales: AIT $ 1,479 $ 1,423 $ 1,311 EVM 3,006 2,795 2,414 Total segment net sales 4,485 4,218 3,725 Corporate, eliminations (1) — — (3 ) Total Net sales $ 4,485 $ 4,218 $ 3,722 Operating income: AIT (2)(3) $ 355 $ 325 $ 274 EVM (2)(3) 483 404 301 Total segment operating income 838 729 575 Corporate, eliminations (4) (146 ) (119 ) (253 ) Total Operating income $ 692 $ 610 $ 322 (1) Amounts included in Corporate, eliminations consist of purchase accounting adjustments related to the Enterprise Acquisition. (2) During 2018, the Company revised its methodology for allocating certain operating expenses across its two reportable segments to more accurately reflect where these operating costs are being incurred. The reallocations relate primarily to facilities, information technology, marketing and human resources expenses. All periods are presented on a comparable basis and reflect these changes which reclassified operating expenses from AIT to EVM of $14 million for the year ended December 31, 2017. There was no impact to the Consolidated Financial Statements as a result of these reallocations. (3) AIT and EVM segment operating income includes depreciation and share-based compensation expense. The amounts of depreciation and share-based compensation attributable expense to AIT and EVM are proportionate to each segment’s Net sales. (4) To the extent applicable, amounts included in Corporate, eliminations consist of purchase accounting adjustments, amortization of intangible assets, acquisition and integration costs, impairment of goodwill and other intangibles, exit and restructuring costs, and product sourcing diversification costs. |
Significant Customers as Percentage of Total Net Sales | Geographic data for long-lived assets is as follows (in millions): Year Ended December 31, 2019 2018 2017 North America $ 280 $ 225 $ 238 EMEA 39 14 14 Asia-Pacific 40 7 9 Latin America 7 3 3 Total long-lived assets $ 366 $ 249 $ 264 Our Net sales to significant customers as a percentage of the total Company’s Net sales by segment were as follows: Year Ended December 31, 2019 2018 2017 AIT EVM Total AIT EVM Total AIT EVM Total Customer A 5.3 % 13.0 % 18.3 % 6.2 % 14.1 % 20.3 % 6.3 % 15.0 % 21.3 % Customer B 4.7 % 9.0 % 13.7 % 5.6 % 10.1 % 15.7 % 5.3 % 8.9 % 14.2 % Customer C 6.1 % 10.5 % 16.6 % 6.2 % 7.9 % 14.1 % 6.2 % 7.0 % 13.2 % |
Information Regarding Operations by Geographic Area | Net sales by region was as follows (in millions): Year Ended December 31, 2019 2018 2017 North America $ 2,261 $ 2,041 $ 1,798 EMEA 1,462 1,409 1,221 Asia-Pacific 518 520 468 Latin America 244 248 235 Total Net sales $ 4,485 $ 4,218 $ 3,722 |
Net Sales by Country | Net sales during these years was as follows (in millions): Year Ended December 31, 2019 2018 2017 United States $ 2,243 $ 2,020 $ 1,746 Germany 523 523 439 Other 1,719 1,675 1,537 Total Net sales $ 4,485 $ 4,218 $ 3,722 |
Supplementary Financial Infor_2
Supplementary Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Components of Accrued Liabilities | The components of Accrued liabilities are as follows (in millions): December 31, 2019 2018 Accrued incentive compensation $ 96 $ 127 Customer reserves 44 45 Accrued payroll 63 55 Accrued warranty 21 22 Current portion of lease liabilities 29 — Unremitted cash collections due to banks on factored accounts receivable 33 — Accrued freight and duty 23 7 Accrued other expenses 70 66 Accrued liabilities $ 379 $ 322 |
Summary of Quarterly Results of Operations | Summary of Quarterly Results of Operations (unaudited, in millions): 2019 First Second Third Fourth Total Year Total Net sales $ 1,066 $ 1,097 $ 1,130 $ 1,192 $ 4,485 Gross profit 501 520 535 544 2,100 Net income 115 124 136 169 544 Net earnings per common share: Basic earnings per share: $ 2.14 $ 2.28 $ 2.52 $ 3.13 $ 10.08 Diluted earnings per share: 2.12 2.26 2.50 3.10 9.97 2018 First Second Third Fourth Total Year Net sales $ 977 $ 1,012 $ 1,092 $ 1,137 $ 4,218 Gross profit 465 472 505 539 1,981 Net income 109 70 127 115 421 Net earnings per common share: Basic earnings per share: $ 2.04 $ 1.31 $ 2.37 $ 2.14 $ 7.86 Diluted earnings per share: 2.01 1.29 2.34 2.11 7.76 |
Significant Accounting Polici_4
Significant Accounting Policies - Property, Plant and Equipment (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Building | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 30 years |
Property, Plant and Equipment, Other | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Property, Plant and Equipment, Other | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 10 years |
Leasehold improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 10 years |
Significant Accounting Polici_5
Significant Accounting Policies - Other Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Capitalized intangible assets, useful life | 3 years |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Capitalized intangible assets, useful life | 15 years |
Significant Accounting Polici_6
Significant Accounting Policies - Advertising (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Abstract] | |||
Advertising expenses | $ 19 | $ 18 | $ 18 |
Significant Accounting Polici_7
Significant Accounting Policies - Warranty Coverage (Detail) | 12 Months Ended |
Dec. 31, 2019 | |
Mobile Computers and WLAN Products | |
Product Warranty Liability [Line Items] | |
Product warranty term | 1 year |
Printheads | |
Product Warranty Liability [Line Items] | |
Product warranty term | 6 months |
Battery-based products | |
Product Warranty Liability [Line Items] | |
Product warranty term | 90 days |
Minimum | Advanced Data Capture Products | |
Product Warranty Liability [Line Items] | |
Product warranty term | 1 year |
Maximum | Advanced Data Capture Products | |
Product Warranty Liability [Line Items] | |
Product warranty term | 5 years |
Significant Accounting Polici_8
Significant Accounting Policies - Compensation Expense and Related Tax Benefit for Equity Based Payments (Detail) | 12 Months Ended |
Dec. 31, 2019 | |
SARs | Maximum | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |
Vesting period for SARs (years) | 4 years |
Significant Accounting Polici_9
Significant Accounting Policies - Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Assets | |||
Prepaid expenses and other current assets | $ 46 | $ 53 | $ 54 |
Right-of-use assets | 107 | 110 | |
Liabilities [Abstract] | |||
Accrued liabilities | 379 | 350 | 322 |
Long-term lease liabilities | 100 | 103 | |
Other long-term liabilities | $ 67 | 67 | $ 89 |
ASU 2016-02 | |||
Assets | |||
Prepaid expenses and other current assets | (1) | ||
Right-of-use assets | 110 | ||
Liabilities [Abstract] | |||
Accrued liabilities | 28 | ||
Long-term lease liabilities | 103 | ||
Other long-term liabilities | $ (22) |
Revenues - Additional Informati
Revenues - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Remaining performance obligation | $ 724,000,000 | $ 489,000,000 | |
Remaining performance obligation period of recognition | 2 years | ||
Capitalized Contract Cost [Line Items] | |||
Capitalized contract, impairment loss | $ 0 | 0 | |
Deferred revenue | 459,000,000 | 382,000,000 | |
Revenue recognized which was previously included in deferred revenue | 219,000,000 | 181,000,000 | |
Other long-term assets | 126,000,000 | 87,000,000 | |
Sales Commissions | |||
Capitalized Contract Cost [Line Items] | |||
Deferred commissions | 21,000,000 | 15,000,000 | |
Amortization expense related to commissions | 11,000,000 | 10,000,000 | |
ASU 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | |||
Capitalized Contract Cost [Line Items] | |||
Other long-term assets | $ 12,000,000 | ||
Prepaid expenses and other current assets | |||
Capitalized Contract Cost [Line Items] | |||
Contract assets | $ 8,000,000 | $ 5,000,000 | $ 7,000,000 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 28, 2019 | Jun. 29, 2019 | Mar. 30, 2019 | Dec. 31, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | $ 1,192 | $ 1,130 | $ 1,097 | $ 1,066 | $ 1,137 | $ 1,092 | $ 1,012 | $ 977 | $ 4,485 | $ 4,218 | $ 3,722 |
Tangible Products | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 3,907 | 3,685 | 3,223 | ||||||||
Services and Software | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 578 | 533 | $ 499 | ||||||||
AIT | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 1,479 | 1,423 | |||||||||
AIT | Tangible Products | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 1,347 | 1,298 | |||||||||
AIT | Services and Software | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 132 | 125 | |||||||||
EVM | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 3,006 | 2,795 | |||||||||
EVM | Tangible Products | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | 2,560 | 2,387 | |||||||||
EVM | Services and Software | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total Net sales | $ 446 | $ 408 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 128 | $ 125 |
Work in process | 4 | 3 |
Finished goods | 342 | 392 |
Total | $ 474 | $ 520 |
Business Acquisitions - Additio
Business Acquisitions - Additional Information (Details) - USD ($) $ in Millions | Nov. 05, 2019 | May 31, 2019 | Feb. 21, 2019 | Aug. 14, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 2,622 | $ 2,495 | $ 2,465 | ||||
Acquisition and integration costs | 22 | 8 | 50 | ||||
Acquisition of business, net of cash acquired | 262 | 72 | $ 0 | ||||
Cortexica Vision Systems Limited | |||||||
Business Acquisition [Line Items] | |||||||
Percentage of equity interests acquired | 100.00% | ||||||
Consideration transferred for net assets acquired | $ 7 | ||||||
Intangible assets acquired | 4 | ||||||
Goodwill | $ 4 | ||||||
Acquisition and integration costs | 2 | ||||||
Profitect Inc | |||||||
Business Acquisition [Line Items] | |||||||
Percentage of equity interests acquired | 100.00% | ||||||
Consideration transferred for net assets acquired | $ 79 | ||||||
Intangible assets acquired | 35 | ||||||
Goodwill | 54 | ||||||
Acquisition and integration costs | 13 | ||||||
Acquisition of business, net of cash acquired | 75 | ||||||
Existing ownership in acquiree remeasured upon acquisition | 4 | ||||||
Ownership interest remeasurement gain | $ 4 | ||||||
Temptime Corporation | |||||||
Business Acquisition [Line Items] | |||||||
Percentage of equity interests acquired | 100.00% | ||||||
Consideration transferred for net assets acquired | $ 180 | ||||||
Intangible assets acquired | 106 | ||||||
Goodwill | 73 | ||||||
Acquisition and integration costs | 3 | ||||||
Acquisition of business, net of cash acquired | 180 | ||||||
Xplore Technologies Corporation | |||||||
Business Acquisition [Line Items] | |||||||
Consideration transferred for net assets acquired | $ 72 | ||||||
Intangible assets acquired | $ 32 | ||||||
Goodwill | 29 | ||||||
Acquisition and integration costs | $ 8 | ||||||
Payment for debt | 9 | ||||||
Transaction related obligations | $ 6 | ||||||
System integration costs | 2 | ||||||
Xplore purchase price allocation adjustments | 6 | ||||||
Measurement period adjustments, deferred tax assets | $ 6 |
Business Acquisitions - Schedul
Business Acquisitions - Schedule of Preliminary Purchase Price Allocation to Assets and Liabilities (Details) - USD ($) $ in Millions | May 31, 2019 | Feb. 21, 2019 | Aug. 14, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | ||||||
Goodwill on acquisition | $ 2,622 | $ 2,495 | $ 2,465 | |||
Profitect Inc | ||||||
Business Acquisition [Line Items] | ||||||
Identifiable intangible assets | $ 35 | |||||
Other assets acquired | 4 | |||||
Deferred tax liabilities | (4) | |||||
Other liabilities assumed | (10) | |||||
Net Assets Acquired | 25 | |||||
Goodwill on acquisition | 54 | |||||
Total purchase consideration | $ 79 | |||||
Temptime Corporation | ||||||
Business Acquisition [Line Items] | ||||||
Inventory | $ 14 | |||||
Property, plant and equipment | 10 | |||||
Identifiable intangible assets | 106 | |||||
Other assets acquired | 13 | |||||
Deferred tax liabilities | (24) | |||||
Other liabilities assumed | (12) | |||||
Net Assets Acquired | 107 | |||||
Goodwill on acquisition | 73 | |||||
Total purchase consideration | $ 180 | |||||
Xplore Technologies Corporation | ||||||
Business Acquisition [Line Items] | ||||||
Accounts receivable | $ 10 | |||||
Inventory | 22 | |||||
Identifiable intangible assets | 32 | |||||
Other assets acquired | 10 | |||||
Debt | (9) | |||||
Accounts payable | (8) | |||||
Deferred revenues | (7) | |||||
Other liabilities assumed | (7) | |||||
Net Assets Acquired | 43 | |||||
Goodwill on acquisition | 29 | |||||
Total purchase consideration | $ 72 |
Business Acquisitions - Sched_2
Business Acquisitions - Schedule of Preliminary Purchase Price Allocation to Intangible Assets Acquired (Details) - USD ($) $ in Millions | May 31, 2019 | Feb. 21, 2019 |
Profitect Inc | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 35 | |
Profitect Inc | Current technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 33 | |
Life (in years) | 8 years | |
Profitect Inc | Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 2 | |
Life (in years) | 1 year | |
Temptime Corporation | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 106 | |
Temptime Corporation | Current technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 25 | |
Life (in years) | 8 years | |
Temptime Corporation | Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 79 | |
Life (in years) | 8 years | |
Temptime Corporation | Customer and other relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 2 | |
Life (in years) | 3 years | |
Xplore Technologies Corporation | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 32 | |
Xplore Technologies Corporation | Current technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 15 | |
Life (in years) | 7 years | |
Xplore Technologies Corporation | Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 16 | |
Life (in years) | 9 years | |
Xplore Technologies Corporation | Customer and other relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 1 | |
Life (in years) | 3 years |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles - Changes in Net Carrying Value of Goodwill (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 2,495 | $ 2,465 |
Foreign exchange impact | 2 | (5) |
Ending balance | 2,622 | 2,495 |
Xplore Technologies Corporation | ||
Goodwill [Roll Forward] | ||
Xplore purchase price allocation adjustments | (6) | |
Acquisition | 35 | |
Temptime Corporation | ||
Goodwill [Roll Forward] | ||
Acquisition | 73 | |
Profitect Inc | ||
Goodwill [Roll Forward] | ||
Acquisition | 54 | |
Cortexica Vision Systems Limited | ||
Goodwill [Roll Forward] | ||
Acquisition | 4 | |
AIT | ||
Goodwill [Roll Forward] | ||
Beginning balance | 154 | 154 |
Foreign exchange impact | 0 | 0 |
Ending balance | 227 | 154 |
AIT | Xplore Technologies Corporation | ||
Goodwill [Roll Forward] | ||
Xplore purchase price allocation adjustments | 0 | |
Acquisition | 0 | |
AIT | Temptime Corporation | ||
Goodwill [Roll Forward] | ||
Acquisition | 73 | |
AIT | Profitect Inc | ||
Goodwill [Roll Forward] | ||
Acquisition | 0 | |
AIT | Cortexica Vision Systems Limited | ||
Goodwill [Roll Forward] | ||
Acquisition | 0 | |
EVM | ||
Goodwill [Roll Forward] | ||
Beginning balance | 2,341 | 2,311 |
Foreign exchange impact | 2 | (5) |
Ending balance | 2,395 | 2,341 |
EVM | Xplore Technologies Corporation | ||
Goodwill [Roll Forward] | ||
Xplore purchase price allocation adjustments | (6) | |
Acquisition | $ 35 | |
EVM | Temptime Corporation | ||
Goodwill [Roll Forward] | ||
Acquisition | 0 | |
EVM | Profitect Inc | ||
Goodwill [Roll Forward] | ||
Acquisition | 54 | |
EVM | Cortexica Vision Systems Limited | ||
Goodwill [Roll Forward] | ||
Acquisition | $ 4 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2019reporting_unit | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Number of reporting units | 5 |
Fair value exceeding carrying value (at least), percent | 55.00% |
Goodwill and Other Intangible_4
Goodwill and Other Intangibles - Amortized Intangible Assets (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 1,196 | $ 1,048 | |
Accumulated Amortization | (921) | (816) | |
Net | 275 | 232 | |
Amortization expense | 103 | 97 | $ 184 |
Current technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 578 | 514 | |
Accumulated Amortization | (508) | (470) | |
Net | 70 | 44 | |
Customer and other relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 575 | 493 | |
Accumulated Amortization | (371) | (305) | |
Net | 204 | 188 | |
Trade Names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 43 | 41 | |
Accumulated Amortization | (42) | (41) | |
Net | $ 1 | $ 0 |
Goodwill and Other Intangible_5
Goodwill and Other Intangibles - Estimated Amortization Expense for Future Periods (Detail) $ in Millions | Dec. 31, 2019USD ($) |
Year Ended December 31, | |
2020 | $ 64 |
2021 | 60 |
2022 | 54 |
2023 | 23 |
2024 | 23 |
Thereafter | 51 |
Total | $ 275 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 610 | $ 546 | |
Less accumulated depreciation | (351) | (297) | |
Property, plant and equipment, net | 259 | 249 | |
Depreciation expense | 72 | 78 | $ 79 |
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 63 | 57 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 7 | 7 | |
Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 232 | 204 | |
Furniture and office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 20 | 18 | |
Software and computer equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 168 | 161 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 84 | 75 | |
Projects in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 36 | $ 24 |
Investments (Details)
Investments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |||
Equity securities held | $ 45 | $ 25 | |
Realized gain (loss) on equity securities | $ 3 | $ 10 | $ (1) |
Exit and Restructuring Costs (D
Exit and Restructuring Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | |||
Exit and restructuring costs | $ 10 | $ 11 | $ 16 |
Estimated remaining costs | 9 | ||
2019 Productivity Plan | |||
Restructuring Cost and Reserve [Line Items] | |||
Exit and restructuring costs | 8 | ||
Estimated remaining costs | 10 | ||
2017 Productivity Plan | |||
Restructuring Cost and Reserve [Line Items] | |||
Exit and restructuring costs | 2 | $ 11 | 12 |
Exit and restructuring charges incurred | 25 | ||
Acquisition Plan | |||
Restructuring Cost and Reserve [Line Items] | |||
Exit and restructuring costs | $ 4 | ||
Exit and restructuring charges incurred | $ 69 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Carried at Fair Value (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Assets: | ||
Total Assets at fair value | $ 27 | $ 38 |
Liabilities: | ||
Total Liabilities at fair value | 37 | 17 |
Level 1 | ||
Assets: | ||
Total Assets at fair value | 24 | 18 |
Liabilities: | ||
Total Liabilities at fair value | 24 | 17 |
Level 2 | ||
Assets: | ||
Total Assets at fair value | 3 | 20 |
Liabilities: | ||
Total Liabilities at fair value | 13 | 0 |
Level 3 | ||
Assets: | ||
Total Assets at fair value | 0 | 0 |
Liabilities: | ||
Total Liabilities at fair value | 0 | 0 |
Foreign exchange contracts | ||
Assets: | ||
Derivative asset | 3 | 16 |
Foreign exchange contracts | Level 1 | ||
Assets: | ||
Derivative asset | 0 | 1 |
Foreign exchange contracts | Level 2 | ||
Assets: | ||
Derivative asset | 3 | 15 |
Foreign exchange contracts | Level 3 | ||
Assets: | ||
Derivative asset | 0 | 0 |
Forward interest rate swaps | ||
Assets: | ||
Derivative asset | 5 | |
Liabilities: | ||
Derivative liability | 13 | |
Forward interest rate swaps | Level 1 | ||
Assets: | ||
Derivative asset | 0 | |
Liabilities: | ||
Derivative liability | 0 | |
Forward interest rate swaps | Level 2 | ||
Assets: | ||
Derivative asset | 5 | |
Liabilities: | ||
Derivative liability | 13 | |
Forward interest rate swaps | Level 3 | ||
Assets: | ||
Derivative asset | 0 | |
Liabilities: | ||
Derivative liability | 0 | |
Money market investments related to the deferred compensation plan | ||
Assets: | ||
Investment | 24 | 17 |
Money market investments related to the deferred compensation plan | Level 1 | ||
Assets: | ||
Investment | 24 | 17 |
Money market investments related to the deferred compensation plan | Level 2 | ||
Assets: | ||
Investment | 0 | 0 |
Money market investments related to the deferred compensation plan | Level 3 | ||
Assets: | ||
Investment | 0 | 0 |
Liabilities related to the deferred compensation plan | ||
Liabilities: | ||
Liabilities related to the deferred compensation plan | 24 | 17 |
Liabilities related to the deferred compensation plan | Level 1 | ||
Liabilities: | ||
Liabilities related to the deferred compensation plan | 24 | 17 |
Liabilities related to the deferred compensation plan | Level 2 | ||
Liabilities: | ||
Liabilities related to the deferred compensation plan | 0 | 0 |
Liabilities related to the deferred compensation plan | Level 3 | ||
Liabilities: | ||
Liabilities related to the deferred compensation plan | $ 0 | $ 0 |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of Derivative Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||
Total derivative instruments not designated as hedges | $ (10) | $ 21 |
Derivative instruments designated as hedges | ||
Derivative [Line Items] | ||
Total derivative instruments not designated as hedges | 3 | 15 |
Derivative instruments not designated as hedges | ||
Derivative [Line Items] | ||
Total derivative instruments not designated as hedges | (13) | 6 |
Prepaid expenses and other current assets | Foreign exchange contracts | Derivative instruments designated as hedges | ||
Derivative [Line Items] | ||
Derivative asset, fair value | 3 | 15 |
Prepaid expenses and other current assets | Foreign exchange contracts | Derivative instruments not designated as hedges | ||
Derivative [Line Items] | ||
Derivative asset, fair value | 0 | 1 |
Prepaid expenses and other current assets | Forward interest rate swaps | Derivative instruments not designated as hedges | ||
Derivative [Line Items] | ||
Derivative asset, fair value | 0 | 2 |
Other long-term assets | Forward interest rate swaps | Derivative instruments not designated as hedges | ||
Derivative [Line Items] | ||
Derivative asset, fair value | 0 | 3 |
Accrued liabilities | Forward interest rate swaps | Derivative instruments not designated as hedges | ||
Derivative [Line Items] | ||
Derivative liability, fair value | (5) | 0 |
Other long-term liabilities | Forward interest rate swaps | Derivative instruments not designated as hedges | ||
Derivative [Line Items] | ||
Derivative liability, fair value | $ (8) | $ 0 |
Derivative Instruments - Net Ga
Derivative Instruments - Net Gains (Losses) from Changes in Fair Value (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total (loss) gain recognized in income | $ 42 | $ 13 | $ (8) |
Derivative instruments not designated as hedges: | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total (loss) gain recognized in income | (22) | 9 | (22) |
Foreign exchange contracts | Foreign exchange loss | Derivative instruments not designated as hedges: | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total (loss) gain recognized in income | (3) | 1 | (24) |
Forward interest rate swaps | Interest expense, net | Derivative instruments not designated as hedges: | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Total (loss) gain recognized in income | $ (19) | $ 8 | $ 2 |
Derivative Instruments - Additi
Derivative Instruments - Additional Information (Details) € in Millions | 3 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2019USD ($)derivative | Dec. 31, 2018USD ($)swap | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)swap | Dec. 31, 2017USD ($) | Dec. 31, 2019EUR (€) | Sep. 28, 2019USD ($) | Dec. 31, 2018EUR (€)swap | |
Change in unrealized gain (loss) on anticipated sales hedging: | ||||||||
Gain (loss) on contract | $ 42,000,000 | $ 13,000,000 | $ (8,000,000) | |||||
Foreign currency cash flow hedge derivative | € | € 564 | € 496 | ||||||
Interest expense | $ 89,000,000 | $ 91,000,000 | 227,000,000 | |||||
Number of Interest rate swaps | swap | 3 | 3 | 3 | |||||
One-time payment classified within net cash provided by operating activities | $ 7,000,000 | |||||||
Derivative instruments designated as hedges | ||||||||
Change in unrealized gain (loss) on anticipated sales hedging: | ||||||||
Derivative, term of contract | 12 months | |||||||
Foreign exchange contracts | ||||||||
Change in unrealized gain (loss) on anticipated sales hedging: | ||||||||
Derivative, increase In gross asset and gross liability, Net | $ 3,000,000 | $ 1,000,000 | $ 3,000,000 | $ 1,000,000 | ||||
Forward interest rate swaps | ||||||||
Change in unrealized gain (loss) on anticipated sales hedging: | ||||||||
Number of swaps terminated | derivative | 3 | |||||||
Pretax losses remaining in AOCI time of termination (less than) | 1,000,000 | |||||||
Forward interest rate swaps | Derivative instruments designated as hedges | ||||||||
Change in unrealized gain (loss) on anticipated sales hedging: | ||||||||
Derivative forward long-term interest rate swap | $ 800,000,000 | $ 800,000,000 | ||||||
Interest expense | $ 2,000,000 | $ 2,000,000 |
Derivative Instruments - Notion
Derivative Instruments - Notional Values and Net Fair Value of Outstanding Contracts (Details) - Foreign Exchange Forward € in Millions, ¥ in Millions, ¥ in Millions, £ in Millions, R in Millions, $ in Millions, $ in Millions, $ in Millions, $ in Millions, $ in Millions | Dec. 31, 2019USD ($) | Dec. 31, 2019GBP (£) | Dec. 31, 2019CAD ($) | Dec. 31, 2019AUD ($) | Dec. 31, 2019JPY (¥) | Dec. 31, 2019MXN ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2019EUR (€) | Dec. 31, 2019SGD ($) | Dec. 31, 2019ZAR (R) | Dec. 31, 2018USD ($) | Dec. 31, 2018GBP (£) | Dec. 31, 2018CAD ($) | Dec. 31, 2018AUD ($) | Dec. 31, 2018JPY (¥) | Dec. 31, 2018MXN ($) | Dec. 31, 2018CNY (¥) | Dec. 31, 2018EUR (€) | Dec. 31, 2018SGD ($) | Dec. 31, 2018ZAR (R) |
Derivative [Line Items] | ||||||||||||||||||||
Net fair value of assets of outstanding contracts | $ | $ 0 | $ 1 | ||||||||||||||||||
US Dollar | ||||||||||||||||||||
Derivative [Line Items] | ||||||||||||||||||||
Notional balance of outstanding contracts: | £ 14 | $ 1 | $ 42 | ¥ 264 | $ 115 | ¥ 0 | € 36 | $ 19 | R 42 | £ 1 | $ 6 | $ 47 | ¥ 396 | $ 225 | ¥ 71 | € 45 | $ 7 | R 42 | ||
Euro | ||||||||||||||||||||
Derivative [Line Items] | ||||||||||||||||||||
Notional balance of outstanding contracts: | £ | £ 0 | £ 6 |
Long-Term Debt - Summary of Car
Long-Term Debt - Summary of Carrying Value of Debt (Details) € in Millions, $ in Millions | Dec. 31, 2019USD ($) | Dec. 31, 2019EUR (€) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | |||
Long-term debt | $ 1,286 | $ 1,600 | |
Less debt issuance costs | (6) | (5) | |
Less unamortized discounts | (3) | (4) | |
Less: Current portion of debt | (197) | (157) | |
Total long-term debt | 1,080 | 1,434 | |
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Long-term debt | 103 | € 92 | 408 |
Term Loan A | Loans Payable | |||
Debt Instrument [Line Items] | |||
Long-term debt | 917 | 608 | |
Term Loan B | Loans Payable | |||
Debt Instrument [Line Items] | |||
Long-term debt | 0 | 445 | |
Receivables Financing Facilities | Secured Debt | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 266 | $ 139 |
Long-Term Debt - Future Maturit
Long-Term Debt - Future Maturities of Long-term Debt (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
2020 | $ 197 | |
2021 | 99 | |
2022 | 56 | |
2023 | 81 | |
2024 | 853 | |
Thereafter | 0 | |
Total future maturities of debt | $ 1,286 | $ 1,600 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) € in Millions, $ in Millions | Dec. 31, 2019USD ($) | Dec. 31, 2019EUR (€) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | |||
Long-term debt borrowed in Euros | $ 1,286 | $ 1,600 | |
Fair value of long-term debt | 1,300 | 1,600 | |
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Long-term debt borrowed in Euros | $ 103 | € 92 | $ 408 |
Long-Term Debt - Credit Facilit
Long-Term Debt - Credit Facility (Details) - USD ($) | Aug. 09, 2019 | May 31, 2018 | Jul. 26, 2017 | Sep. 28, 2019 | Dec. 31, 2017 | Dec. 31, 2019 |
Line of Credit Facility [Line Items] | ||||||
Debt issuance costs | $ 5,000,000 | |||||
Accelerated amortization of debt issuance costs | $ 6,000,000 | 6,000,000 | ||||
Senior Notes | ||||||
Line of Credit Facility [Line Items] | ||||||
Accelerated amortization of debt issuance costs | $ 16,000,000 | |||||
Outstanding principal redeemed | 1,100,000,000 | |||||
Make whole premium | $ 65,000,000 | |||||
Loans Payable | Term Loan A | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving credit facility maximum borrowing capacity | $ 608,000,000 | 670,000,000 | ||||
Extinguishment of debt | 445,000,000 | |||||
Debt issuance costs, one time pretax charges | 2,000,000 | |||||
Percentage bearing variable interest, percentage rate | 3.01% | |||||
Loans Payable | Term Loan B | ||||||
Line of Credit Facility [Line Items] | ||||||
Extinguishment of debt | 300,000,000 | |||||
Debt issuance costs, one time pretax charges | 1,000,000 | |||||
Revolving Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving credit facility maximum borrowing capacity | $ 500,000,000 | |||||
Letters of credit | $ 5,000,000 | |||||
Funds available for other borrowings | $ 995,000,000 | |||||
Revolving credit facility interest rate | 1.25% | |||||
Revolving Credit Agreement | A&R Credit Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Revolving credit facility maximum borrowing capacity | $ 1,000,000,000 | $ 800,000,000 | $ 1,000,000,000 | |||
Accelerated amortization of debt issuance costs | $ 4,000,000 | |||||
Gain (loss) on contract termination | 3,000,000 | |||||
Payments of debt restructuring costs | $ 6,000,000 |
Long-Term Debt - Receivables Fi
Long-Term Debt - Receivables Financing Facility (Details) | Dec. 31, 2019USD ($)facility | Jun. 29, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Debt Instrument [Line Items] | ||||
Accounts receivable pledged | $ 545,000,000 | |||
Number of receivable financing facilities | facility | 2 | |||
Total outstanding debt | $ 266,000,000 | |||
Current portion of long-term debt | $ 197,000,000 | $ 157,000,000 | ||
Secured Debt | Receivables Financing Facility | ||||
Debt Instrument [Line Items] | ||||
Facility amount | $ 100,000,000 | $ 180,000,000 | ||
Remaining borrowing capacity | $ 280,000,000 | |||
Receivable financing facility, average interest rate | 2.60% |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | |
Leases [Abstract] | |||
Term of lease | 13 years | ||
Weighted average remaining term | 6 years | ||
Weighted average discount rate used to measure ROU assets and lease liabilities (approximately) | 6.00% | ||
Rent expense | $ 33 | $ 34 |
Leases - Activities Associated
Leases - Activities Associated With Operating Leases (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Fixed lease expenses | $ 37 |
Variable lease expenses | 29 |
Total lease expenses | 66 |
Cash paid for leases | 67 |
ROU assets obtained in exchange for lease obligations | 42 |
Reduction of ROU assets and lease liabilities | (16) |
Net non-cash increases to ROU assets and lease liabilities | $ 26 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Jan. 01, 2019 |
Leases [Abstract] | ||
2020 | $ 36 | |
2021 | 30 | |
2022 | 24 | |
2023 | 20 | |
2024 | 15 | |
Thereafter | 27 | |
Total future minimum lease payments | 152 | |
Less: Interest | (23) | |
Present value of lease liabilities | 129 | |
Current portion of lease liabilities | 29 | |
Long-term lease liabilities | $ 100 | $ 103 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Accrued Warranty Obligations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | |||
Balance at the beginning of the year | $ 22 | $ 18 | $ 21 |
Acquisitions | 0 | 1 | 0 |
Warranty expense | 25 | 34 | 28 |
Warranties fulfilled | (26) | (31) | (31) |
Balance at the end of the year | $ 21 | $ 22 | $ 18 |
Commitments and Contingencies_2
Commitments and Contingencies - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Pre-tax charge for litigation settlement | $ 13 |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Equity Awards Authorized and Available for Future Grant and Additional Information (Detail) - 2018 Plan | 12 Months Ended |
Dec. 31, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant [Roll Forward] | |
Available for future grants, beginning (in shares) | 3,789,800 |
Equity awards granted (in shares) | (304,840) |
Available for future grants, ending (in shares) | 3,484,960 |
Share-Based Compensation - Comp
Share-Based Compensation - Compensation Expense and Related Income Tax Benefit (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total compensation expense | $ 60 | $ 53 | $ 38 |
Income tax benefit | 9 | 10 | 11 |
Unearned compensation costs related to awards granted | $ 62 | ||
Unearned compensation cost, expected to be recognized over period (years) | 1 year 4 months 24 days | ||
Cost of sales | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total compensation expense | $ 4 | 4 | 3 |
Selling and marketing | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total compensation expense | 17 | 13 | 8 |
Research and development | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total compensation expense | 16 | 15 | 11 |
General and administration | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total compensation expense | $ 23 | $ 21 | $ 16 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of SAR's Outstanding (Details) - SARs - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
SARs, Shares Outstanding | |||
Outstanding at beginning of year (in shares) | 1,261,185 | 1,817,991 | 1,740,786 |
Granted (in shares) | 70,141 | 88,042 | 402,029 |
Exercised (in shares) | (395,015) | (598,249) | (250,326) |
Forfeited (in shares) | (39,388) | (46,161) | (66,550) |
Expired (in shares) | 0 | (438) | (7,948) |
Outstanding at end of year (in shares) | 896,923 | 1,261,185 | 1,817,991 |
Shares, Exercisable at end of year (in shares) | 489,357 | 595,086 | 874,942 |
Weighted- Average Exercise Price | |||
Outstanding at beginning of year (in USD per share) | $ 75.71 | $ 65.73 | $ 56.15 |
Granted (in USD per share) | 205.12 | 149.75 | 98.87 |
Exercised (in USD per share) | 66.82 | 55.93 | 48.66 |
Forfeited (in USD per share) | 92.72 | 80.41 | 75.38 |
Expired (in USD per share) | 0 | 108.20 | 108.20 |
Outstanding at end of year (in USD per share) | 89.05 | 75.71 | 65.73 |
Exercisable at end of year (in USD per share) | $ 70.37 | $ 60.85 | $ 50.86 |
Share-Based Compensation - Weig
Share-Based Compensation - Weighted-Average Assumptions Used for Grants of Stock Options and SARs (Detail) - SARs - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Forfeiture rate | 8.20% | 8.40% | 9.37% |
Volatility | 36.79% | 35.93% | 35.49% |
Risk free interest rate | 2.28% | 2.96% | 1.77% |
Expected weighted-average life (in years) | 4 years 7 days | 4 years 1 month 9 days | 4 years 1 month 17 days |
Weighted-average grant date fair value of SARs granted (per underlying share) (in USD per share) | $ 64.17 | $ 47.63 | $ 29.86 |
Share-Based Compensation - Su_3
Share-Based Compensation - Summary of Outstanding and Exercisable Options and SARs (Detail) - SARs - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summary of SARs outstanding | |||
Aggregate intrinsic value, outstanding | $ 149 | ||
Aggregate intrinsic value, exercisable | $ 91 | ||
Weighted-average remaining contractual term, outstanding | 4 years 10 months 24 days | ||
Weighted-average remaining contractual term, exercisable | 4 years 6 months | ||
Intrinsic value of SARs exercised | $ 58 | $ 59 | $ 14 |
Fair value of SARs vested | $ 9 | $ 12 | $ 8 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Awards and Performance Share Awards Activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Restricted Stock | |||
Restricted Stock Awards and Performance Share Awards | |||
Outstanding at beginning of year (in shares) | 657,724 | 628,642 | 622,814 |
Granted (in shares) | 170,502 | 206,922 | 199,629 |
Released (in shares) | (372,075) | (154,878) | (165,846) |
Forfeited (in shares) | (21,510) | (22,962) | (27,955) |
Outstanding at end of year (in shares) | 434,641 | 657,724 | 628,642 |
Weighted-Average Grant Date Fair Value | |||
Outstanding at beginning of year (in USD per share) | $ 93.45 | $ 77.70 | $ 70.19 |
Granted (in USD per share) | 204.26 | 150.60 | 98.90 |
Released (in USD per share | 73.71 | 107.22 | 75.90 |
Forfeited (in USD per share) | 141.29 | 88.77 | 72.81 |
Outstanding at end of year (in USD per share) | $ 151.52 | $ 93.45 | $ 77.70 |
Performance Share Awards | |||
Restricted Stock Awards and Performance Share Awards | |||
Outstanding at beginning of year (in shares) | 259,727 | 265,747 | 379,226 |
Granted (in shares) | 150,224 | 59,849 | 79,423 |
Released (in shares) | (231,513) | (57,074) | (2,029) |
Forfeited (in shares) | (7,689) | (8,795) | (190,873) |
Outstanding at end of year (in shares) | 170,749 | 259,727 | 265,747 |
Weighted-Average Grant Date Fair Value | |||
Outstanding at beginning of year (in USD per share) | $ 86.41 | $ 77.04 | $ 70.14 |
Granted (in USD per share) | 206.04 | 146.83 | 98.97 |
Released (in USD per share | 120.86 | 107.31 | 62.70 |
Forfeited (in USD per share) | 102.42 | 81.07 | 73.09 |
Outstanding at end of year (in USD per share) | $ 144.47 | $ 86.41 | $ 77.04 |
Maximum | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Maximum | Performance Share Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Nonemployee | Restricted Stock | |||
Restricted Stock Awards and Performance Share Awards | |||
Granted (in shares) | 7,371 | 7,980 | 12,488 |
Share-Based Compensation - Othe
Share-Based Compensation - Other Award Types (Details) - Other Award Types - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based liabilities paid | $ 6 | $ 2 | $ 2 |
Number of shares that became available under the Plan | 17,207 | 20,393 | 45,781 |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period (not more than) | 4 years |
Share-Based Compensation - Su_4
Share-Based Compensation - Summary of Non-qualified Option Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Weighted- Average Exercise Price | |||
Income tax benefit | $ 9 | $ 10 | $ 11 |
Non-qualified Stock Options | |||
Non-qualified Options | |||
Outstanding at beginning of year (in shares) | 0 | 15,705 | 154,551 |
Granted (in shares) | 0 | 0 | 0 |
Exercised (in shares) | 0 | (15,705) | (132,905) |
Forfeited (in shares) | 0 | 0 | 0 |
Expired (in shares) | 0 | 0 | (5,941) |
Outstanding at end of year (in shares) | 0 | 0 | 15,705 |
Shares, Exercisable at end of period (in shares) | 0 | 0 | 15,705 |
Weighted- Average Exercise Price | |||
Outstanding at beginning of year (in USD per share) | $ 0 | $ 26.34 | $ 35.96 |
Granted (in USD per share) | 0 | 0 | 0 |
Exercised (in USD per share) | 0 | 26.34 | 36.86 |
Forfeited (in USD per share) | 0 | 0 | 0 |
Expired (in USD per share) | 0 | 0 | 41.25 |
Outstanding at end of year (in USD per share) | 0 | 0 | 26.34 |
Exercisable at end of year (in USD per share) | $ 0 | $ 0 | $ 26.34 |
Intrinsic value for options exercised | $ 2 | $ 8 | |
Cash received from the exercise of options | 1 | 5 | |
Income tax benefit | $ 2 | $ 2 | |
Options vested in period | 0 | 0 | 0 |
Share-Based Compensation - Empl
Share-Based Compensation - Employee Stock Purchase Plan (Details) - 2011 Employee Stock Purchase Plan - Employee Stock Option - Common Stock | 12 Months Ended |
Dec. 31, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares available for grant | 774,186 |
Date Of Purchase | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Purchase price equal to lesser of fair market value percentage | 95.00% |
Date Of Grant | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares that became available under the Plan | 1,500,000 |
Income Taxes - Geographical Sou
Income Taxes - Geographical Sources of Income (Loss) Before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 83 | $ (25) | $ (152) |
Outside United States | 515 | 549 | 240 |
Income (loss) before income taxes | $ 598 | $ 524 | $ 88 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Benefit) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Federal | $ 16 | $ 20 | $ 10 |
State | (1) | 3 | 8 |
Foreign | 81 | 77 | 62 |
Total current | 96 | 100 | 80 |
Deferred: | |||
Federal | (32) | (11) | 20 |
State | (5) | 5 | (10) |
Foreign | (5) | 9 | (19) |
Total deferred | (42) | 3 | (9) |
(Benefit) provision for income taxes | $ 54 | $ 103 | $ 71 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Contingency [Line Items] | |||
Effective income tax rate | 9.00% | 19.70% | 80.70% |
Federal statutory rate | 21.00% | 21.00% | 35.00% |
Operating loss carryforwards | $ 410 | ||
Tax credits | 29 | $ 28 | |
GILTI, provisional income tax expense | $ 12 | ||
GILTI, incomplete accounting provisional income tax expense | 10 | ||
Deferred tax assets rate expected to reverse in the future (as percent) | 21.00% | ||
Tax Cuts And Jobs Act Of 2017, incomplete accounting, provisional income tax expense | $ 72 | ||
Tax Cuts And Jobs Act Of 2017, incomplete accounting, transition tax for accumulated foreign earnings, provisional income tax expense (benefit) | (3) | 37 | |
Tax Cuts And Jobs Act Of 2017, incomplete accounting, change in tax rate, remeasurement of net deferred tax assets | 35 | ||
Unrecognized tax benefits that would affect annual effective tax rate | $ 9 | 48 | |
Tax dispute | 19 | ||
Lapse of statute of limitations | 20 | 0 | |
Unrecognized tax benefits that may reverse | 0 | ||
Interest and or penalties related to Income tax matters | 6 | 8 | $ 2 |
Penalties and interest accrued | 8 | $ 14 | |
Expire Year 2020 thru 2033 | |||
Income Tax Contingency [Line Items] | |||
Net operating loss carryforwards | 161 | ||
Expire Year 2023 thru 2032 | |||
Income Tax Contingency [Line Items] | |||
Tax credits | $ 15 | ||
United Kingdom (HMRC) | |||
Income Tax Contingency [Line Items] | |||
Federal statutory rate | 19.00% | ||
Singapore (IRAS) | |||
Income Tax Contingency [Line Items] | |||
Federal statutory rate | 17.00% | ||
Luxembourg Inland Revenue | |||
Income Tax Contingency [Line Items] | |||
Federal statutory rate | 25.00% | ||
Singapore Economic Development Board | |||
Income Tax Contingency [Line Items] | |||
Effective income tax rate | 10.50% | ||
Current Liability | |||
Income Tax Contingency [Line Items] | |||
Deferred income taxes undistributed foreign earnings | $ 1 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of U. S. Federal Statutory Income Tax Rate to Actual Income Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Provision computed at statutory rate | 21.00% | 21.00% | 35.00% |
U.S. Tax Reform - one-time transition tax | 0 | (0.006) | 0.418 |
Remeasurement of deferred taxes | 0.20% | 0.70% | (56.00%) |
Change in valuation allowance | (1.70%) | (4.50%) | 96.40% |
US impact of Enterprise acquisition and integration | 1.00% | 1.10% | 12.90% |
Change in contingent income tax reserves | (3.30%) | 3.20% | 14.00% |
Foreign earnings subject to U.S. taxation | 1.80% | 2.00% | 2.00% |
Foreign rate differential | (0.70%) | (2.00%) | (29.10%) |
Intra-entity transactions | 0.00% | 0.00% | (18.80%) |
State income tax, net of Federal tax benefit | (0.20%) | 0.80% | (5.30%) |
Tax credits | (2.30%) | (1.90%) | (5.70%) |
Equity compensation deductions | (4.00%) | (2.00%) | (5.60%) |
Return to provision and other true ups | (2.00%) | 1.10% | (3.20%) |
Other | (0.80%) | 0.80% | 2.30% |
Provision for income taxes | 9.00% | 19.70% | 80.70% |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Capitalized research expenditures | $ 37 | $ 28 |
Deferred revenue | 24 | 21 |
Tax credits | 29 | 28 |
Net operating loss carryforwards | 410 | 394 |
Other accruals | 21 | 20 |
Inventory items | 18 | 20 |
Capitalized software costs | 2 | 8 |
Sales return/rebate reserve | 48 | 41 |
Share-based compensation expense | 12 | 15 |
Accrued bonus | 7 | 3 |
Unrealized gain and losses on securities and investments | 4 | 0 |
Valuation allowance | (421) | (56) |
Total deferred tax assets | 191 | 522 |
Deferred tax liabilities: | ||
Depreciation and amortization | 62 | 411 |
Unrealized gains and losses on securities and investments | 0 | 2 |
Undistributed earnings | 2 | 3 |
Total deferred tax liabilities | 64 | 416 |
Net deferred tax assets | $ 127 | $ 106 |
Income Taxes - Reconciliation_2
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits | ||
Balance at beginning of year | $ 50 | $ 51 |
Additions for tax positions related to the current year | 1 | 1 |
Additions for tax positions related to prior years | 0 | 22 |
Reductions for tax positions related to prior years | (5) | (11) |
Settlements for tax positions | (16) | (13) |
Lapse of statutes | (20) | 0 |
Balance at end of year | $ 10 | $ 50 |
Earnings Per Share - Computatio
Earnings Per Share - Computation (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 28, 2019 | Jun. 29, 2019 | Mar. 30, 2019 | Dec. 31, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic: | |||||||||||
Net income | $ 169 | $ 136 | $ 124 | $ 115 | $ 115 | $ 127 | $ 70 | $ 109 | $ 544 | $ 421 | $ 17 |
Weighted-average shares outstanding | 53,991,249 | 53,591,655 | 53,021,761 | ||||||||
Basic earnings per share (in USD per share) | $ 3.13 | $ 2.52 | $ 2.28 | $ 2.14 | $ 2.14 | $ 2.37 | $ 1.31 | $ 2.04 | $ 10.08 | $ 7.86 | $ 0.33 |
Diluted: | |||||||||||
Net income | $ 169 | $ 136 | $ 124 | $ 115 | $ 115 | $ 127 | $ 70 | $ 109 | $ 544 | $ 421 | $ 17 |
Weighted-average shares outstanding | 53,991,249 | 53,591,655 | 53,021,761 | ||||||||
Dilutive shares | 603,168 | 708,157 | 667,071 | ||||||||
Diluted weighted-average shares outstanding | 54,594,417 | 54,299,812 | 53,688,832 | ||||||||
Diluted earnings per share (in USD per share) | $ 3.10 | $ 2.50 | $ 2.26 | $ 2.12 | $ 2.11 | $ 2.34 | $ 1.29 | $ 2.01 | $ 9.97 | $ 7.76 | $ 0.32 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |||
Anti-dilutive shares | 47,240 | 72,856 | 259,142 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning Balance | $ 1,335 | $ 834 | $ 792 |
Other comprehensive (loss) income before reclassifications | 31 | 33 | (23) |
Amounts reclassified from AOCI | (40) | (9) | 16 |
Tax effect | 0 | (7) | 0 |
Other comprehensive loss (income), net of tax | (9) | 17 | (7) |
Ending Balance | 1,839 | 1,335 | 834 |
Unrealized gain (loss) on sales hedging | |||
Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning Balance | 12 | (9) | 6 |
Other comprehensive (loss) income before reclassifications | 38 | (26) | |
Amounts reclassified from AOCI | (13) | 8 | |
Tax effect | (4) | 3 | |
Other comprehensive loss (income), net of tax | 21 | (15) | |
Ending Balance | 12 | (9) | |
Unrealized gain (loss) on sales hedging | |||
Accumulated Other Comprehensive Income [Roll Forward] | |||
Other comprehensive (loss) income before reclassifications | 30 | ||
Amounts reclassified from AOCI | (42) | ||
Tax effect | 2 | ||
Other comprehensive loss (income), net of tax | (10) | ||
Ending Balance | 2 | ||
Unrealized gain (loss) on forward interest rate swaps | |||
Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning Balance | 0 | (9) | (15) |
Other comprehensive (loss) income before reclassifications | 0 | 8 | 1 |
Amounts reclassified from AOCI | 2 | 4 | 8 |
Tax effect | (2) | (3) | (3) |
Other comprehensive loss (income), net of tax | 0 | 9 | 6 |
Ending Balance | 0 | 0 | (9) |
Foreign currency translation adjustments | |||
Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning Balance | (47) | (34) | (36) |
Other comprehensive (loss) income before reclassifications | 1 | (13) | 2 |
Amounts reclassified from AOCI | 0 | 0 | 0 |
Tax effect | 0 | 0 | 0 |
Other comprehensive loss (income), net of tax | 1 | (13) | 2 |
Ending Balance | (46) | (47) | (34) |
Total | |||
Accumulated Other Comprehensive Income [Roll Forward] | |||
Beginning Balance | (35) | (52) | (45) |
Ending Balance | $ (44) | $ (35) | $ (52) |
Accounts Receivable Factoring (
Accounts Receivable Factoring (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Transfers and Servicing [Abstract] | ||
Eligible uncollected receivables available, maximum | $ 125,000,000 | |
Uncollected receivables sold and removed from the balance sheet | 60,000,000 | $ 33,000,000 |
Unremitted cash collections due to banks on factored accounts receivable | $ 33,000,000 | $ 0 |
Segment Information and Geogr_3
Segment Information and Geographic Data - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($)segment | Dec. 31, 2017USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Reportable segments | segment | 2 | 2 | |
Operating expenses | $ (1,408) | $ (1,371) | $ (1,388) |
Customer A | Customer Concentration Risk | Accounts Receivable | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 16.80% | 23.00% | |
Customer B | Customer Concentration Risk | Accounts Receivable | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 7.80% | 16.90% | |
Customer C | Customer Concentration Risk | Accounts Receivable | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Concentration risk percentage | 20.60% | 14.60% | |
AIT | Operating segments | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Operating expenses | $ 14 |
Segment Information and Geogr_4
Segment Information and Geographic Data - Financial Information by Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 28, 2019 | Jun. 29, 2019 | Mar. 30, 2019 | Dec. 31, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net sales | |||||||||||
Total Net sales | $ 1,192 | $ 1,130 | $ 1,097 | $ 1,066 | $ 1,137 | $ 1,092 | $ 1,012 | $ 977 | $ 4,485 | $ 4,218 | $ 3,722 |
Operating income: | |||||||||||
Total Operating income | 692 | 610 | 322 | ||||||||
Operating segments | |||||||||||
Net sales | |||||||||||
Total Net sales | 4,485 | 4,218 | 3,725 | ||||||||
Operating income: | |||||||||||
Total Operating income | 838 | 729 | 575 | ||||||||
Corporate, eliminations | |||||||||||
Net sales | |||||||||||
Total Net sales | 0 | 0 | (3) | ||||||||
Operating income: | |||||||||||
Total Operating income | (146) | (119) | (253) | ||||||||
AIT | |||||||||||
Net sales | |||||||||||
Total Net sales | 1,479 | 1,423 | |||||||||
AIT | Operating segments | |||||||||||
Net sales | |||||||||||
Total Net sales | 1,479 | 1,423 | 1,311 | ||||||||
Operating income: | |||||||||||
Total Operating income | 355 | 325 | 274 | ||||||||
EVM | |||||||||||
Net sales | |||||||||||
Total Net sales | 3,006 | 2,795 | |||||||||
EVM | Operating segments | |||||||||||
Net sales | |||||||||||
Total Net sales | 3,006 | 2,795 | 2,414 | ||||||||
Operating income: | |||||||||||
Total Operating income | $ 483 | $ 404 | $ 301 |
Segment Information and Geogr_5
Segment Information and Geographic Data - Net Sales to Significant Customers as a Percent of Total Net Sales (Detail) - Sales Revenue, Net - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Customer A | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 18.30% | 20.30% | 21.30% |
Customer A | AIT | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 5.30% | 6.20% | 6.30% |
Customer A | EVM | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 13.00% | 14.10% | 15.00% |
Customer B | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 13.70% | 15.70% | 14.20% |
Customer B | AIT | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 4.70% | 5.60% | 5.30% |
Customer B | EVM | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 9.00% | 10.10% | 8.90% |
Customer C | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 16.60% | 14.10% | 13.20% |
Customer C | AIT | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 6.10% | 6.20% | 6.20% |
Customer C | EVM | |||
Revenue, Major Customer [Line Items] | |||
Concentration risk percentage | 10.50% | 7.90% | 7.00% |
Segment Information and Geogr_6
Segment Information and Geographic Data - Net Sales by Country (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 28, 2019 | Jun. 29, 2019 | Mar. 30, 2019 | Dec. 31, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | $ 1,192 | $ 1,130 | $ 1,097 | $ 1,066 | $ 1,137 | $ 1,092 | $ 1,012 | $ 977 | $ 4,485 | $ 4,218 | $ 3,722 |
North America | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 2,261 | 2,041 | 1,798 | ||||||||
EMEA | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 1,462 | 1,409 | 1,221 | ||||||||
Asia-Pacific | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 518 | 520 | 468 | ||||||||
Latin America | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 244 | 248 | 235 | ||||||||
Sales Revenue, Net | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 4,485 | 4,218 | 3,722 | ||||||||
Sales Revenue, Net | United States | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 2,243 | 2,020 | 1,746 | ||||||||
Sales Revenue, Net | Germany | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | 523 | 523 | 439 | ||||||||
Sales Revenue, Net | Other | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Total Net sales | $ 1,719 | $ 1,675 | $ 1,537 |
Segment Information and Geogr_7
Segment Information and Geographic Data - Information Regarding Operations by Geographic Area (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 366 | $ 249 | $ 264 |
North America | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | 280 | 225 | 238 |
EMEA | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | 39 | 14 | 14 |
Asia | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | 40 | 7 | 9 |
Latin America | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Long-lived assets | $ 7 | $ 3 | $ 3 |
Supplementary Financial Infor_3
Supplementary Financial Information - Accrued Liabilities (Details) - USD ($) | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Quarterly Financial Information Disclosure [Abstract] | |||||
Accrued incentive compensation | $ 96,000,000 | $ 127,000,000 | |||
Customer reserves | 44,000,000 | 45,000,000 | |||
Accrued payroll | 63,000,000 | 55,000,000 | |||
Accrued warranty | 21,000,000 | 22,000,000 | $ 18,000,000 | $ 21,000,000 | |
Current portion of lease liabilities | 29,000,000 | ||||
Unremitted cash collections due to banks on factored accounts receivable | 33,000,000 | 0 | |||
Accrued freight and duty | 23,000,000 | 7,000,000 | |||
Accrued other expenses | 70,000,000 | 66,000,000 | |||
Accrued liabilities | $ 379,000,000 | $ 350,000,000 | $ 322,000,000 |
Supplementary Financial Infor_4
Supplementary Financial Information - Summary of Quarterly Results of Operations (unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 28, 2019 | Jun. 29, 2019 | Mar. 30, 2019 | Dec. 31, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total Net sales | $ 1,192 | $ 1,130 | $ 1,097 | $ 1,066 | $ 1,137 | $ 1,092 | $ 1,012 | $ 977 | $ 4,485 | $ 4,218 | $ 3,722 |
Gross profit | 544 | 535 | 520 | 501 | 539 | 505 | 472 | 465 | 2,100 | 1,981 | 1,710 |
Net income | $ 169 | $ 136 | $ 124 | $ 115 | $ 115 | $ 127 | $ 70 | $ 109 | $ 544 | $ 421 | $ 17 |
Net earnings per common share: | |||||||||||
Basic earnings per share (in USD per share) | $ 3.13 | $ 2.52 | $ 2.28 | $ 2.14 | $ 2.14 | $ 2.37 | $ 1.31 | $ 2.04 | $ 10.08 | $ 7.86 | $ 0.33 |
Diluted earnings per share (in USD per share) | $ 3.10 | $ 2.50 | $ 2.26 | $ 2.12 | $ 2.11 | $ 2.34 | $ 1.29 | $ 2.01 | $ 9.97 | $ 7.76 | $ 0.32 |
Valuation and Qualifying Acco_2
Valuation and Qualifying Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Valuation account for accounts receivable: | |||
Valuation Account | |||
Balance at Beginning of Period | $ 3 | $ 3 | $ 3 |
Charged to Costs and Expenses | 0 | 1 | 1 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions | 1 | 1 | 1 |
Balance at End of Period | 2 | 3 | 3 |
Valuation account for deferred tax assets: | |||
Valuation Account | |||
Balance at Beginning of Period | 56 | 134 | 47 |
Charged to Costs and Expenses | 6 | 0 | 91 |
Charged to Other Accounts | 375 | 0 | 0 |
Deductions | 16 | 78 | 4 |
Balance at End of Period | $ 421 | $ 56 | $ 134 |
Uncategorized Items - a10k12312
Label | Element | Value |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (19,000,000) |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 9,000,000 |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (19,000,000) |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (9,000,000) |