Revenue

3 Months Ended

Apr. 02, 2021

Revenue from Contract with Customer [Abstract]

Revenue

REVENUE

The following tables present the Company’s revenues disaggregated by geographical region and revenue type for the three-month periods ended April 2, 2021 and April 3, 2020 ($ in millions). Sales taxes and other usage-based taxes collected from customers are excluded from revenue.

	Life Sciences		Diagnostics		Environmental & Applied Solutions		Total
For the Three-Month Period Ended April 2, 2021:
Geographical region:
North America	$	1,263	$	972	$	492	$	2,727
Western Europe	970		415		279		1,664
Other developed markets	225		118		29		372
High-growth markets (a)	1,088		673		334		2,095
Total	$	3,546	$	2,178	$	1,134	$	6,858
Revenue type:
Recurring	$	2,529	$	1,902	$	648	$	5,079
Nonrecurring	1,017		276		486		1,779
Total	$	3,546	$	2,178	$	1,134	$	6,858
For the Three-Month Period Ended April 3, 2020:
Geographical region:
North America	$	621	$	755	$	497	$	1,873
Western Europe	471		310		256		1,037
Other developed markets	153		98		30		281
High-growth markets (a)	405		464		283		1,152
Total	$	1,650	$	1,627	$	1,066	$	4,343
Revenue type:
Recurring	$	1,159	$	1,428	$	620	$	3,207
Nonrecurring	491		199		446		1,136
Total	$	1,650	$	1,627	$	1,066	$	4,343

(a) The Company defines high-growth markets as developing markets of the world experiencing extended periods of accelerated growth in gross domestic product and infrastructure which include Eastern Europe, the Middle East, Africa, Latin America and Asia (with the exception of Japan, Australia and New Zealand). The Company defines developed markets as all markets that are not high-growth markets.

The Company sells equipment to customers as well as consumables, software licenses and services, some of which customers purchase on a recurring basis. Consumables sold for use with the equipment sold by the Company are typically critical to the use of the equipment and are typically used on a one-time or limited basis, requiring frequent replacement in the customer’s operating cycle. Examples of these consumables include reagents used in diagnostic tests, filters used in filtration, separation and purification processes and cartridges for marking and coding equipment. Additionally, some of the Company’s consumables are used on a standalone basis, such as water treatment solutions. The Company separates its goods and services between those sold on a recurring basis and those sold on a nonrecurring basis. Recurring revenue includes revenue from consumables, services, software licenses recognized over time, software-as-a-service licenses, sales-and-usage based royalties and operating-type leases (“OTLs”). Nonrecurring revenue includes sales from equipment, software licenses recognized at a point in time and sales-type leases (“STLs”). OTLs and STLs are included in the above revenue amounts. For the three-month periods ended April 2, 2021 and April 3, 2020, lease revenue was $109 million and $110 million, respectively.

Remaining performance obligations related to Topic 606, Revenue from Contracts with Customers, represent the aggregate transaction price allocated to performance obligations with an original contract term greater than one year which are fully or partially unsatisfied at the end of the period. As of April 2, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $2.9 billion. The Company expects to recognize revenue on

approximately 47% of the remaining performance obligations over the next 12 months, 25% over the subsequent 12 months, and the remainder recognized thereafter.

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (“contract assets”) and deferred revenue, customer deposits and billings in excess of revenue recognized (“contract liabilities”) on the Consolidated Condensed Balance Sheets. Most of the Company’s long-term contracts are billed as work progresses in accordance with the contract terms and conditions, either at periodic intervals or upon achievement of certain milestones. Often this results in billing occurring subsequent to revenue recognition resulting in contract assets. Contract assets are generally classified as other current assets in the Consolidated Condensed Balance Sheets. The balance of contract assets as of April 2, 2021 and December 31, 2020 was $77 million and $65 million, respectively.

The Company often receives cash payments from customers in advance of the Company’s performance resulting in contract liabilities. These contract liabilities are classified as either current or long-term in the Consolidated Condensed Balance Sheets based on the timing of when the Company expects to recognize revenue. As of April 2, 2021 and December 31, 2020, contract liabilities were approximately $1.5 billion and approximately $1.4 billion, respectively, and are included within accrued expenses and other liabilities and other long-term liabilities in the accompanying Consolidated Condensed Balance Sheets. The increase in the contract liability balance during the three-month period ended April 2, 2021 was primarily a result of cash payments received in advance of satisfying performance obligations and acquisitions, partially offset by revenue recognized during the year that was included in the opening contract liability balance. Revenue recognized during the three-month periods ended April 2, 2021 and April 3, 2020 that was included in the contract liability balance on December 31, 2020 and December 31, 2019 was $520 million and $268 million, respectively. Contract assets and liabilities are reported on the accompanying Consolidated Condensed Balance Sheets on a contract-by-contract basis.