v3.26.3
REPORTABLE SEGMENTS AND RELATED INFORMATION (Tables)
 9 Months Ended
Sep. 30, 2026
Segment Reporting [Abstract]  
Schedule of Segment Revenues and Significant Expenses
The following tables show segment revenues and significant expenses for the Company’s reportable segments:
Three Months Ended September 30, 2026
Power Systems
Aftermarket SolutionsInter-segment EliminationsConsolidated
(in millions)
Net sales to external customers$561 $351 $— $912 
Inter-segment eliminations$38 $— $(38)$— 
Net Sales$599 $351 $(38)$912 
Less:
Cost of sales492 254 
Selling, general and administrative expenses (excluding Net R&D costs shown separately below)1
18 34 
Net R&D costs22 3 
Other segment items2
(1)— 
Segment AOI$68 $60 
Three Months Ended September 30, 2025
Power Systems
Aftermarket SolutionsInter-segment EliminationsConsolidated
(in millions)
Net sales to external customers$571 $337 $— $908 
Inter-segment eliminations$39 $— $(39)$— 
Net Sales$610 $337 $(39)$908 
Less:
Cost of sales501 246 
Selling, general and administrative expenses (excluding Net R&D costs shown separately below)1
18 34 
Net R&D costs18 2 
Other segment items2
(3)4 
Segment AOI$76 $51 
Nine Months Ended September 30, 2026
Power Systems
Aftermarket SolutionsInter-segment EliminationsConsolidated
(in millions)
Net sales to external customers$1,694 $1,036 $— $2,730 
Inter-segment eliminations$97 $— $(97)$— 
Net Sales$1,791 $1,036 $(97)$2,730 
Less:
Cost of sales1,478 741 
Selling, general and administrative expenses (excluding Net R&D costs shown separately below)1
59 107 
Net R&D costs78 9 
Other segment items2
(7)2 
Segment AOI$183 $177 
Nine Months Ended September 30, 2025
Power Systems
Aftermarket SolutionsInter-segment EliminationsConsolidated
(in millions)
Net sales to external customers$1,617 $977 $— $2,594 
Inter-segment eliminations$114 $— $(114)$— 
Net Sales$1,731 $977 $(114)$2,594 
Less:
Cost of sales1,432 707 
Selling, general and administrative expenses (excluding Net R&D costs shown separately below)1
50 97 
Net R&D costs70 8 
Other segment items2
(5)6 
Segment AOI$184 $159 
____________
1 Excludes acquisition-related intangibles amortization.

2 Other segment items include inter-segment fees and other income.
Segment information as of September 30, 2026 and December 31, 2025 and for the three and nine months ended September 30, 2026 and 2025 is presented in the tables below:
Assets
(in millions)September 30, 2026December 31, 2025
Power Systems$2,055 $2,088 
Aftermarket Solutions1,413 1,351 
Total3,468 3,439 
Corporate1
491 378 
Consolidated$3,959 $3,817 
_______________
1 Corporate assets include cash and cash equivalents, investments and long-term receivables, and deferred income taxes.
Depreciation and amortizationThree Months Ended September 30,Nine Months Ended September 30,
(in millions)2026202520262025
Power Systems$35 $34 $103 $96 
Aftermarket Solutions6 6 18 19 
Total41 40 121 115 
Corporate— — 1 1 
Consolidated$41 $40 $122 $116 
Long-lived asset expenditures1
Nine Months Ended September 30,
(in millions)20262025
Power Systems$63 $85 
Aftermarket Solutions6 7 
Total69 92 
Corporate2 3 
Consolidated$71 $95 
_______________
1 Long-lived asset expenditures include capital expenditures and tooling outlays.
Schedule of Segment Adjusted Operating Income
The following table shows a reconciliation of Segment AOI to Earnings before income taxes for the Company’s reportable segments:
Three Months Ended September 30,Nine Months Ended September 30,
(in millions)2026202520262025
Power Systems
$68 $76 $183 $184 
Aftermarket Solutions60 51 177 159 
Segment AOI128 127 360 343 
Corporate, including stock-based compensation26 26 78 75 
Amortization of acquisition-related intangibles8 8 24 22 
Restructuring expense5 4 16 11 
Merger and acquisition expense2 4 5 9 
Separation-related costs2 53 3 43 
Losses (gains) for other one-time events1 (2)1 (2)
Interest income(2)(3)(6)(11)
Interest expense21 20 62 60 
Equity in affiliates’ earnings, net of tax(4)(3)(13)(11)
Other postretirement (income) expense, net(1)1 (4)3 
Earnings before income taxes$70 $19 $194 $144