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REVENUE FROM CONTRACTS WITH CUSTOMERS
 3 Months Ended
Mar. 31, 2026
Revenue from Contract with Customer [Abstract]  
REVENUE FROM CONTRACTS WITH CUSTOMERS REVENUE FROM CONTRACTS WITH CUSTOMERS
The Company manufactures and sells products, primarily to OEMs of light vehicles and, to a lesser extent, to other OEMs of commercial vehicles and off-highway vehicles, to certain tier one vehicle systems suppliers and into the aftermarket. The Company’s payment terms are based on customary business practices and vary by customer type and products offered. The Company has evaluated the terms of its arrangements and determined that they do not contain significant financing components.
Generally, revenue is recognized upon shipment or delivery; however, a limited number of the Company’s customer arrangements for its highly customized products with no alternative use provide the Company with the right to payment during the production process. As a result, for these limited arrangements, revenue is recognized as goods are produced and control transfers to the customer using the input cost-to-cost method. The Company recorded a contract asset of $15 million at both March 31, 2026 and December 31, 2025, for these arrangements. These amounts are reflected in Prepayments and other current assets in the Company’s Condensed Consolidated Balance Sheets.
In limited instances, certain customers have provided payments in advance of receiving related products, typically at the onset of an arrangement prior to the beginning of production. As of March 31, 2026, these
contract liabilities are reflected as Other current liabilities and Other non-current liabilities in the Condensed Consolidated Balance Sheets and were $1 million and $2 million, respectively. As of December 31, 2025, Other current liabilities and Other non-current liabilities were each $1 million. These amounts are reflected as revenue over the term of the arrangement (typically three to seven years) as the underlying products are shipped and represent the Company’s remaining performance obligations as of the end of the period.
The Company continually seeks business development opportunities and, at times, provides customer incentives for new program awards. When the Company determines that the payments are incremental and incurred only if the new business is obtained and expects to recover these amounts from the customer over the term of the new business arrangement, the Company capitalizes these amounts. As of March 31, 2026 and December 31, 2025, the Company recorded customer incentive payments of $13 million and $7 million, respectively, in Prepayments and other current assets, and $31 million and $22 million, respectively, in Other non-current assets on the Condensed Consolidated Balance Sheets. The Company evaluates the amounts capitalized each period end for recoverability and writes off any amounts that are no longer expected to be recovered over the term of the business arrangement.
The Company’s products can be disaggregated by two types: eProducts and Foundational products. eProducts include all products utilized on or for electric vehicles (“EVs”) plus those same products and components that are included in hybrid powertrains whose underlying technologies are adaptable or applicable to those used in or for EVs. Foundational products include all products utilized on internal combustion engines plus those same products and components that are also included in hybrid powertrains. The following table represents a disaggregation of revenue from contracts with customers by Foundational products and eProducts for the three months ended March 31, 2026 and 2025.
Three Months Ended March 31,
(in millions)20262025
Foundational products$2,936 $2,878 
eProducts597 637 
Total$3,533 $3,515 
The following tables represent a disaggregation of revenue from contracts with customers by reportable segment and region. Refer to Note 22, “Reportable Segments,” to the Condensed Consolidated Financial Statements for more information.
Three Months Ended March 31, 2026
(in millions)Turbos & Thermal TechnologiesDrivetrain & Morse SystemsPowerDrive SystemsBattery Energy SystemsTotal
North America$344 $543 $80 $44 $1,011 
Europe719 353 219 50 1,341 
Asia303 522 282 — 1,107 
Other66 — — 8 74 
Total$1,432 $1,418 $581 $102 $3,533 
Three Months Ended March 31, 2025
(in millions)Turbos & Thermal TechnologiesDrivetrain & Morse SystemsPowerDrive SystemsBattery Energy SystemsTotal
North America$352 $487 $83 $47 $969 
Europe737 325 159 96 1,317 
Asia302 544 313 2 1,161 
Other63 — — 5 68 
Total$1,454 $1,356 $555 $150 $3,515