v3.25.1
CONTRACT AND OTHER DEFERRED ASSETS, CONTRACT LIABILITIES AND DEFERRED INCOME & PROGRESS COLLECTIONS
 3 Months Ended
Mar. 31, 2025
Contractors [Abstract]  
CONTRACT AND OTHER DEFERRED ASSETS, CONTRACT LIABILITIES AND DEFERRED INCOME & PROGRESS COLLECTIONS CONTRACT AND OTHER DEFERRED ASSETS, CONTRACT LIABILITIES AND DEFERRED INCOME & PROGRESS COLLECTIONS
Contract assets (liabilities) and other deferred assets (income), on a net basis, increased the net liability position by $350 million for the three months ended March 31, 2025, primarily due to an increase in long-term service agreements liabilities of $272 million. In aggregate, the net liability for long-term service agreements increased primarily due to billings of $1,902 million and net unfavorable changes in estimated profitability of $279 million, including quarterly updates to contract margins and an estimated impact from tariffs, primarily in Commercial Engines & Services, partially offset by revenue recognized of $1,867 million. Revenue recognized for contracts included in a liability position at the beginning of the year were $2,040 million and $1,881 million for the three months ended March 31, 2025 and 2024, respectively.

CONTRACT ASSETS, LIABILITIES AND OTHER DEFERRED ASSETS AND INCOMEMarch 31, 2025December 31, 2024
Long-term service agreements
$2,309 $2,374 
Equipment and other service agreements630 609 
Current contract assets
$2,940 $2,982 
Nonrecurring engineering costs(a)
$2,443 $2,438 
Customer advances and other(b)
2,392 2,393 
Contract and other deferred assets4,835 4,831 
Total contract and other deferred assets$7,775 $7,814 
Long-term service agreement liabilities
$9,266 $8,994 
Current deferred income357 359 
Contract liabilities and current deferred income$9,624 $9,353 
Non-current deferred income1,054 1,013 
Total contract liabilities and deferred income$10,677 $10,366 
Contract assets (liabilities) and other deferred assets (income)$(2,902)$(2,552)
(a) Includes contract fulfillment costs for engineering and development incurred prior to production for equipment production contracts, primarily within our Defense & Propulsion Technologies segment, which are amortized ratably over each unit produced. We assess the recoverability of these costs and if we determine the costs are no longer probable of recovery, the asset is impaired.
(b) Includes amounts due from customers within our Commercial Engines & Services segment for the sales of engines, spare parts and services, which we collect through fixed or usage-based billings from the sale of spare parts and servicing of equipment under long-term service agreements.
Progress collections increased $147 million in the three months ended March 31, 2025 primarily due to collections received in excess of settlements at Defense & Propulsion Technologies.