Revenue Recognition (Note)

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

NOTE 3 - REVENUE RECOGNITION

DISAGGREGATED REVENUE

A geographic disaggregation of revenues across our company segmentation in the following tables provides information to assist in evaluating the nature, timing and uncertainty of revenue and cash flows and how they may be impacted by economic factors.

	2021
Reportable Segments	Industrial Packaging		Global Cellulose Fibers		Corporate & Intersegment		Total
Primary Geographical Markets (a)
United States	$	14,006	$	2,510	$	253	$	16,769
EMEA	1,506		109		(4)		1,611
Pacific Rim and Asia	59		113		35		207
Americas, other than U.S.	755		—		21		776
Total	$	16,326	$	2,732	$	305	$	19,363
Operating Segments
North American Industrial Packaging	$	14,944	$	—	$	—	$	14,944
EMEA Industrial Packaging	1,508		—		—		1,508
Global Cellulose Fibers	—		2,732		—		2,732
Intra-segment Eliminations	(126)		—		—		(126)
Corporate & Inter-segment Sales	—		—		305		305
Total	$	16,326	$	2,732	$	305	$	19,363

(a) Net sales are attributed to countries based on the location of the reportable segment making the sale.

	2020
Reportable Segments	Industrial Packaging		Global Cellulose Fibers		Corporate & Intersegment		Total
Primary Geographical Markets (a)
United States	$	12,770	$	2,212	$	196	$	15,178
EMEA	1,309		90		(4)		1,395
Pacific Rim and Asia	57		91		55		203
Americas, other than U.S.	764		—		25		789
Total	$	14,900	$	2,393	$	272	$	17,565
Operating Segments
North American Industrial Packaging	$	13,552	$	—	$	—	$	13,552
EMEA Industrial Packaging	1,317		—		—		1,317
Brazilian Industrial Packaging	148		—		—		148
Global Cellulose Fibers	—		2,393		—		2,393
Intra-segment Eliminations	(117)		—		—		(117)
Corporate & Inter-segment Sales	—		—		272		272
Total	$	14,900	$	2,393	$	272	$	17,565

(a) Net sales are attributed to countries based on the location of the reportable segment making the sale.

	2019
Reportable Segments	Industrial Packaging		Global Cellulose Fibers		Corporate & Intersegment		Total
Primary Geographical Markets (a)
United States	$	12,968	$	2,427	$	221	$	15,616
EMEA	1,327		104		(4)		1,427
Pacific Rim and Asia	65		149		173		387
Americas, other than U.S.	900		—		(13)		887
Total	$	15,260	$	2,680	$	377	$	18,317
Operating Segments
North American Industrial Packaging	$	13,808	$	—	$	—	$	13,808
EMEA Industrial Packaging	1,335		—		—		1,335
Brazilian Industrial Packaging	235		—		—		235
Global Cellulose Fibers	—		2,680		—		2,680
Intra-segment Eliminations	(118)		—		—		(118)
Corporate & Inter-segment Sales	—		—		377		377
Total	$	15,260	$	2,680	$	377	$	18,317

(a) Net sales are attributed to countries based on the location of the reportable segment making the sale.

REVENUE CONTRACT BALANCES

A contract asset is created when the Company recognizes revenue on its customized products prior to having an unconditional right to payment from the customer, which generally does not occur until title and risk of loss passes to the customer.

A contract liability is created when customers prepay for goods prior to the Company transferring those goods to the customer. The contract liability is reduced once control of the goods is transferred to the customer. The majority of our customer prepayments are received during the fourth quarter each year for goods that will be transferred to customers over the following twelve months. Current liabilities of $27 million and $21 million are included in Other current liabilities in the accompanying condense consolidated balance sheets as of December 31, 2021 and 2020, respectively. During the second quarter of 2021, the Company also recorded a contract liability of $115 million related to the April 2021 acquisition disclosed in Note 7 - Acquisitions.

The difference between the opening and closing balances of the Company's contract assets and contract liabilities primarily results from the difference between the price and quantity at comparable points in time for goods which we have an unconditional right to payment or receive prepayment from the customer, respectively.

PERFORMANCE OBLIGATIONS AND SIGNIFICANT JUDGEMENTS

International Paper's principal business is to manufacture and sell fiber-based packaging and pulp goods. As a general rule, none of our businesses provide equipment installation or other ancillary services outside of producing and shipping packaging and pulp products to customers.

The nature of the Company's contracts can vary based on the business, customer type and region; however, in all instances it is International Paper's customary business practice to receive a valid order from the customer, in which each parties' rights and related payment terms are clearly identifiable.

Contracts or purchase orders with customers could include a single type of product or it could include multiple types/grades of products. Regardless, the contracted price with the customer is agreed to at the individual product level outlined in the customer contracts or purchase orders. The Company does not

bundle prices; however, we do negotiate with customers on pricing and rebates for the same products based on a variety of factors (e.g. level of contractual volume, geographical location, etc.). Management has concluded that the prices negotiated with each individual customer are representative of the stand-alone selling price of the product.