XML 32 R17.htm IDEA: XBRL DOCUMENT v3.21.2
Revenues and Accounts Receivable
9 Months Ended
Sep. 30, 2021
Revenue from Contract with Customer [Abstract]  
Revenues and Accounts Receivable REVENUES AND ACCOUNTS RECEIVABLE
Disaggregated Revenue
The following table presents the Company’s revenues disaggregated by revenue source (in millions). Management uses these categories of revenue to evaluate the performance of its businesses and to assess its financial results and forecasts.
Three Months Ended September 30,
20212020
U.S. NetworksInternational NetworksCorporate, inter-segment eliminations, and otherTotalU.S. NetworksInternational NetworksCorporate, inter-segment eliminations, and otherTotal
Revenues:
Advertising$991 $467 $— $1,458 $941 $365 $— $1,306 
Distribution841 538 — 1,379 696 503 — 1,199 
Other26 290 (3)313 22 34 — 56 
Total$1,858 $1,295 $(3)$3,150 $1,659 $902 $— $2,561 
Nine Months Ended September 30,
20212020
U.S. NetworksInternational NetworksCorporate, inter-segment eliminations, and otherTotalU.S. NetworksInternational NetworksCorporate, inter-segment eliminations, and otherTotal
Revenues:
Advertising$3,090 $1,420 $— $4,510 $2,964 $1,017 $— $3,981 
Distribution2,465 1,592 — 4,057 2,143 1,504 — 3,647 
Other82 363 (8)437 64 87 157 
Total$5,637 $3,375 $(8)$9,004 $5,171 $2,608 $$7,785 

Accounts Receivable and Credit Losses
Receivables include amounts currently due from customers and are presented net of an estimate for lifetime expected credit losses. Allowance for credit losses is measured using historical loss rates for the respective risk categories and incorporating forward-looking estimates. To assess collectability, the Company analyzes market trends, economic conditions, the aging of receivables and customer specific risks, and records a provision for estimated credit losses expected over the lifetime of receivables. The corresponding expense for the expected credit losses is reflected in selling, general and administrative expenses. The Company does not require collateral with respect to trade receivables.
The Company’s accounts receivable balances and the related credit losses arise primarily from distribution and advertising revenue. The Company monitors ongoing credit exposure through active review of customers’ financial conditions, aging of receivable balances, historical collection trends, and expectations about relevant future events that may significantly affect collectability. The allowance for credit losses decreased from $59 million at December 31, 2020 to $54 million at September 30, 2021. The activity in the allowance for credit losses for the nine months ended September 30, 2021 was not material.
Contract Liability
A contract liability, such as deferred revenue, is recorded when cash is received in advance of the Company's performance. Total deferred revenues, including both current and noncurrent, were $710 million and $649 million at September 30, 2021 and December 31, 2020, respectively. Noncurrent deferred revenue is a component of other noncurrent liabilities on the consolidated balance sheets. The change in deferred revenue for the nine months ended September 30, 2021 was primarily due to cash payments received for which the performance obligation was not satisfied prior to the end of the period, partially offset by revenue recognized during the period, of which $414 million was included in the deferred revenue balance at December 31, 2020. Revenue recognized for the nine months ended September 30, 2020 related to the deferred revenue balance at December 31, 2019 was $340 million.
Transaction Price Allocated to Remaining Performance Obligations
Most of the Company's distribution contracts are licenses of functional intellectual property where revenue is derived from royalty-based arrangements, for which the guidance allows the application of a practical expedient to record revenues as a function of royalties earned to date instead of estimating incremental royalty contract revenue. Accordingly, in these instances revenue is recognized based upon the royalties earned to date. However, there are certain other distribution arrangements that are fixed price or contain minimum guarantees that extend beyond one year. The Company recognizes revenue for fixed fee distribution contracts on a monthly basis based on minimum monthly fees; by calculating one twelfth of annual license fees specified in its distribution contracts; or based on the pro-rata fees earned calculated on the license fees specified in the distribution contract. The transaction price allocated to remaining performance obligations within these fixed price or minimum guarantee distribution revenue contracts was $1.4 billion as of September 30, 2021 and is expected to be recognized over the next six years.
The Company's content licensing contracts and sports sublicensing deals are licenses of functional intellectual property. Certain of these arrangements extend beyond one year. The transaction price allocated to remaining performance obligations on these long-term contracts was $684 million as of September 30, 2021 and is expected to be recognized over the next four years.
The Company's brand licensing contracts are licenses of symbolic intellectual property. Certain of these arrangements extend beyond one year. The transaction price allocated to remaining performance obligations on these long-term contracts was $93 million as of September 30, 2021 and is expected to be recognized over the next eleven years.
The value of unsatisfied performance obligations disclosed above does not include: (i) contracts involving variable consideration for which revenues are recognized in accordance with the usage-based royalty exception, and (ii) contracts with an original expected length of one year or less, such as advertising contracts.