Investments

12 Months Ended

Dec. 31, 2021

Schedule of Investments [Abstract]

Investments

4. Investments

Investment

Investments and securities sold, not yet purchased consist of equities, bonds, bank debt and other corporate obligations, all of which are reported at fair value in our consolidated balance sheets. In addition, our Investment segment has certain derivative transactions which are discussed in Note 6, “Financial Instruments.” The carrying value and detail by security type, including business sector for equity securities, with respect to investments and securities sold, not yet purchased held by our Investment segment consist of the following:

	December 31,
	2021		2020
	(in millions)
Assets
Investments:
Equity securities:
Consumer, non-cyclical	$	680	$	1,548
Consumer, cyclical		1,633		2,073
Energy		3,184		2,654
Utilities		992		107
Healthcare		959		—
Technology		931		1,578
Materials		194		—
Industrial		265		158
		8,838		8,118
Corporate debt securities		114		121
	$	8,952	$	8,239
Liabilities
Securities sold, not yet purchased, at fair value:
Equity securities:
Consumer, non-cyclical	$	139	$	424
Consumer, cyclical		709		572
Energy		2,028		1,476
Utilities		659		49
Healthcare		1,049		—
Materials		365		—
Industrial		391		—
	$	5,340	$	2,521

The portion of unrealized gains that relates to securities still held by our Investment segment, primarily equity securities, was $1,153 million, $65 million and $706 million for the years ended December 31, 2021, 2020 and 2019, respectively.

As discussed in Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” when certain investments become subject to the equity method of accounting, our Investment segment elects the fair value option to such investment. Investments become subject to the equity method of accounting when we possess the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. The ability to exercise significant influence is presumed when we possess more than 20% of the voting interests of the investee. This presumption may be overcome based on specific facts and circumstances that demonstrate that the ability to exercise significant influence is restricted. Conversely, there is a presumption that for investments in which we have less than 20% of the voting interests of the investee that we do not have the ability to exercise significant influence. However, such presumption may be overcome based on specific facts and circumstances that demonstrate that the ability to exercise significant influence is present, such as when we have representation on the board of directors of such investee.

After considering specific facts and circumstances, including the collective ownership in entities by the Investment Funds and affiliates of Mr. Icahn, as well as their collective representation on each of the boards of directors, we have determined that we had the ability to exercise significant influence over the operating and financial policies of certain investees of our Investment segment.

During the second quarter of 2020, the Investment Funds sold their entire investment in Hertz. Prior to the sale of its investment in Hertz, the Investment Funds owned approximately 38.9% of the outstanding common stock of Hertz.

In addition, in August 2020, the Investment Funds sold a portion of their investment in Herbalife Nutrition Ltd. (“Herbalife”) pursuant to Herbalife’s “modified Dutch auction” tender offer to purchase its common shares, and as a result, the Investment Funds ceased to have an ability to exercise significant influence over the operating and financial policies of Herbalife. Prior to this transaction, the Investment Funds owned approximately 23.8% of the outstanding common stock of Herbalife.

Due to the nature of our Investment segment’s operations, the sales of Hertz and Herbalife are deemed to be in the ordinary course of business.

The following table contains summarized financial information with respect to our investments in Hertz and Herbalife during the respective periods (or partial periods) in which we possessed the ability to exercise significant influence over the operating and financial policies of the investee.

	Hertz						Herbalife
	Year Ended December 31,						Year Ended December 31,
	2021		2020		2019		2021		2020		2019
	(in millions)
Net sales/Other revenue from operations	$	—	$	2,755	$	9,779	$	—	$	2,609	$	4,877
Cost of goods sold/Other expenses from operations		—		3,231		8,051		—		518		958
Net (loss) income		—		(1,209)		(50)		—		161		311
Net (loss) income attributable to investee shareholders		—		(1,203)		(58)		—		161		311

Other Segments and Holding Company

With the exception of certain equity method investments at our operating subsidiaries and our Holding Company disclosed in the table below, our investments are measured at fair value in our consolidated balance sheets. The carrying value of investments held by our other segments and our Holding Company consist of the following:

	December 31,
	2021		2020
	(in millions)
Equity method investments	$	79	$	120
Held to maturity debt investments measured at amortized cost		—		20
Other investments measured at fair value		120		534
	$	199	$	674

The portion of unrealized losses that relates to equity securities still held by our other segments and our Holding Company was $61 million, $36 million and $421 million for the years ended December 31, 2021, 2020 and 2019, respectively.