Changes in estimated contract earnings at completion using the cumulative catch-up method of accounting were recognized in revenues as follows: | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | Nine Months Ended | (Amounts in millions) | July 3, 2026 | | June 27, 2025 | | July 3, 2026 | | June 27, 2025 | | Favorable earnings at completion adjustments | $ | 84 | | | $ | 48 | | | $ | 203 | | | $ | 98 | | | Unfavorable earnings at completion adjustments | (46) | | | (35) | | | (120) | | | (58) | | | Net favorable adjustments | $ | 38 | | | $ | 13 | | | $ | 83 | | | $ | 40 | | | | | | | | | | Impact on diluted earnings per share attributable to common shareholders (1) | $ | 0.12 | | | $ | 0.04 | | | $ | 0.27 | | | $ | 0.13 | |
(1) The impact on diluted earnings per share attributable to common shareholders is calculated using our statutory tax rate. The Company's contract balances consisted of the following (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | As of | | Description of Contract Related Balance | | Classification | | July 3, 2026 | | October 3, 2025 | | Billed and billable receivables | | Accounts receivable, net | | $ | 1,490 | | | $ | 1,514 | | | Contract assets | | Accounts receivable, net | | 1,007 | | | 902 | | | Related party receivables | | Accounts receivable, net | | 56 | | | 63 | | | Long-term contract assets | | Other long-term assets | | — | | | 90 | | | Related party contract liabilities - deferred revenues and other contract liabilities | | Contract liabilities | | (9) | | | (15) | | | Contract liabilities - deferred revenues and other contract liabilities | | Contract liabilities | | (162) | | | (212) | |
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