Note 22 – Segment Information

We operate in five principal segments: Commercial Airplanes; Boeing Military Aircraft, Network & Space Systems, and Global Services & Support, collectively Boeing Defense, Space & Security; and Boeing Capital Corporation. All other activities fall within the Other segment or Unallocated items and eliminations. See page 54 for the Summary of Business Segment Data, which is an integral part of this note.

The Commercial Airplanes segment develops, produces and markets commercial jet aircraft and provides related support services, principally to the commercial airline industry worldwide.

Our BMA segment programs include A160 Hummingbird, AH-64 Apache, AEW&C, CH-47 Chinook, C-17 Globemaster, EA-18G Growler Airborne Attack Electronic Aircraft, F/A-18E/F Super Hornet, F-15 Strike Eagle, F-22 Raptor, Harpoon, USAF KC-46A Tanker, KC-767 International Tanker, Joint Direct Attack Munition, P-8A Poseidon, India P-8I, ScanEagle, Small Diameter Bomb, T-45TS Goshawk and V-22 Osprey.

Our N&SS segment programs include Airborne Laser, Brigade Combat Team Modernization, Combat Survivor Evader Locator, Crew Space Transportation-100, cyber and security programs, directed energy, Enhanced Medium Altitude Reconnaissance and Surveillance System, Family of Advanced Beyond Line-of-Sight Terminals, Future Rapid Effects System, Global Positioning System, Ground-based Midcourse Defense (GMD), International Space Station, Joint Tactical Radio System, satellite systems, SBInet, Space Launch System, space payloads, Space Shuttle and Wideband Global SATCOM.

Our GS&S segment programs include Integrated Logistics on platforms including AEW&C, AH-64, AV-8B, C-17, CH-47, F-15, F/A-18, F-22, GMD Operations and Support (O&S), KC-767 International Tanker, P-8A, T-45 and V-22; Maintenance, Modifications and Upgrades on platforms including A-10, B-1, B-2, B-52, C-32, C-40, C-130, E-4B, E-6, KC-10, KC-135, QF-16, T-38 and VC-25; Training Systems and Services on platforms including AH-64, C-17, F-15, F-16, F/A-18, P-8A and T-45; and Defense and Government Services including the Infrastructure and Range Services, Log C2 and LogNEC program.

Our BCC segment facilitates, arranges, structures and provides selective financing solutions for our Commercial Airplanes customers. In the space and defense markets, BCC primarily arranges and structures financing solutions for our BDS government customers.

Our Other segment includes the unallocated activities of Engineering, Operations & Technology (EO&T) and Shared Services Group (SSG), as well as intercompany guarantees provided to BCC. EO&T provides Boeing with technical and functional capabilities, including information technology, research and development, test and evaluation, technology strategy development, environmental remediation management and intellectual property management.

Effective January 1, 2011, 2010 and 2009 certain programs were realigned among BDS segments. Business segment data for all periods presented have been adjusted to reflect the realignment.

While our principal operations are in the United States, Canada and Australia, some key suppliers and subcontractors are located in Europe and Japan. Revenues by geographic area consisted of the following:


Years ended December 31,	2011		2010		2009
Asia, other than China	$	7,438	$	7,288	$	7,536
China		4,779		3,109		4,888
Europe		9,850		7,872		7,516
Middle East		5,477		3,685		5,338
Oceania		3,067		1,707		1,447
Africa		1,759		956		602
Canada		618		612		493
Latin America, Caribbean and other		1,356		930		963
Total non-U.S. revenues		34,344		26,159		28,783
United States		34,391		38,147		39,498
Total revenues	$	68,735	$	64,306	$	68,281

Commercial Airplanes segment revenues were approximately 83%, 78% and 86% of total revenues in Europe and approximately 61%, 75% and 70% of total revenues in Asia, excluding China, for 2011, 2010 and 2009, respectively. BDS revenues were approximately 16%, 20% and 12% of total revenues in Europe and approximately 38%, 25% and 29% of total revenues in Asia, excluding China, for 2011, 2010 and 2009, respectively. BDS revenues from the U.S. government represented 37%, 43% and 43% of consolidated revenues for 2011, 2010 and 2009, respectively. Approximately 4% and 5% of operating assets were located outside the United States as of December 31, 2011 and 2010.

The information in the following tables is derived directly from the segments' internal financial reporting used for corporate management purposes.

Research and Development Expense


Years ended December 31,	2011		2010		2009
Commercial Airplanes	$	2,715	$	2,975	$	5,383
Boeing Defense, Space & Security:
Boeing Military Aircraft		541		589		582
Network & Space Systems		476		417		397
Global Services & Support		121		130		122
Total Boeing Defense, Space & Security		1,138		1,136		1,101
Other segment		65		10		22
Total research and development expense, net	$	3,918	$	4,121	$	6,506

Research and development expense includes bid and proposal costs of $332, $355 and $343, respectively.

Depreciation and Amortization


Years ended December 31,	2011		2010		2009
Commercial Airplanes	$	565	$	541	$	495
Boeing Defense, Space & Security:
Boeing Military Aircraft		116		143		145
Network & Space Systems		128		161		169
Global Services & Support		62		63		69
Total Boeing Defense, Space & Security		306		367		383
Boeing Capital Corporation		153		204		210
Other segment		242		233		201
Unallocated items and eliminations		409		401		389
Total	$	1,675	$	1,746	$	1,678

Capital Expenditures


Years ended December 31,	2011		2010		2009
Commercial Airplanes	$	540	$	341	$	420
Boeing Defense, Space & Security:
Boeing Military Aircraft		122		102		141
Network & Space Systems		101		83		51
Global Services & Support		55		51		75
Total Boeing Defense, Space & Security		278		236		267
Other segment		174		136		113
Unallocated items and eliminations		721		412		386
Total	$	1,713	$	1,125	$	1,186

Unallocated capital expenditures relate primarily to assets managed by SSG on behalf of the five principal segments.

We recorded Earnings from operations associated with our cost and equity method investments of $69, $67 and $74 in our Commercial Airplanes segment and $210, $201 and $175 primarily in our N&SS segment for the years ended December 31, 2011, 2010 and 2009, respectively.

For segment reporting purposes, we record Commercial Airplanes segment revenues and cost of sales for airplanes transferred to other segments. Such transfers may include airplanes accounted for as operating leases and considered transferred to the BCC segment and airplanes transferred to the BDS segment for further modification prior to delivery to the customer. The revenues and cost of sales for these transfers are eliminated in the Unallocated items and eliminations caption. For segment reporting purposes, we record BDS revenues and cost of sales for the modification performed on airplanes received from Commercial Airplanes when the airplane is delivered to the customer or at the attainment of performance milestones.

Intersegment revenues, eliminated in Unallocated items and eliminations, are shown in the following table.


Years ended December 31,	2011		2010		2009
Commercial Airplanes	$	701	$	604	$	740
Boeing Capital Corporation		66		92		80
Total	$	767	$	696	$	820

Unallocated Items and Eliminations

Unallocated items and eliminations includes costs not attributable to business segments as well as intercompany profit eliminations. We generally allocate costs to business segments based on the U.S. federal cost accounting standards. Unallocated pension and other postretirement expense which represents the difference between costs recognized under Generally Accepted Accounting Principles in the United States of America in the consolidated financial statements and federal cost accounting standards required to be utilized by certain business segments for U.S. government contracting purposes.

The most significant items not allocated to segments are shown in the following table.


Years ended December 31,	2011			2010			2009
Share-based plans	$	(83	)	$	(136	)	$	(189	)
Deferred compensation		(61	)		(112	)		(158	)
Pension		(269	)		54			110
Postretirement		(248	)		(59	)		(93	)
Capitalized interest		(51	)		(54	)		(53	)
Eliminations and other		(276	)		(428	)		(211	)
Total	$	(988	)	$	(735	)	$	(594	)

Unallocated assets primarily consist of cash and investments, net deferred tax assets, capitalized interest and assets held by SSG as well as intercompany eliminations. Unallocated liabilities include various accrued employee compensation and benefit liabilities, including accrued retiree health care, net deferred tax liabilities and income taxes payable. Debt securities and notes payable are not allocated to other business segments except for the portion related to BCC.

Segment assets and liabilities are summarized in the tables below.

Assets


December 31,	2011		2010
Commercial Airplanes	$	35,458	$	28,341
Boeing Defense, Space & Security:
Boeing Military Aircraft		7,390		6,725
Network & Space Systems		7,028		7,456
Global Services & Support		3,572		3,691
Total Boeing Defense, Space & Security		17,990		17,872
Boeing Capital Corporation		4,638		5,561
Other segment		1,100		779
Unallocated items and eliminations		20,800		16,012
Total	$	79,986	$	68,565

Liabilities


December 31,	2011		2010
Commercial Airplanes	$	21,757	$	19,663
Boeing Defense, Space & Security:
Boeing Military Aircraft		3,050		4,028
Network & Space Systems		1,101		953
Global Services & Support		1,607		1,579
Total Boeing Defense, Space & Security		5,758		6,560
Boeing Capital Corporation		3,719		3,861
Other segment		969		937
Unallocated items and eliminations		44,175		34,682
Total	$	76,378	$	65,703