Expected warranty costs for products sold are recognized principally at the time of sale of the product based on an estimate of the amount that eventually will be required to settle such obligations. These accruals are based on factors such as past experience, production changes, industry developments and various other considerations. The estimated costs related to product recalls based on a formal campaign soliciting return of that product are accrued at the time an obligation becomes probable and can be reasonably estimated. These estimates are adjusted from time to time based on facts and circumstances that impact the status of existing claims. The Company has recognized a reasonable estimate for its total aggregate warranty reserves, including product recall costs, as of June 30, 2026. At June 30, 2026, the difference between the recorded liabilities and the reasonably possible range of potential loss was not material.

The table below summarizes the activity in the product warranty liability for the six months ended June 30, 2026:


	Warranty Obligations

	(in millions)
Accrual balance at January 1, 2026	$	14
Provision for estimated warranties incurred during the period	8
Changes in estimate for pre-existing warranties	(1)
Settlements	(6)

Accrual balance at June 30, 2026	$	15