SEGMENT INFORMATION

ASC 280, "Segment Reporting," establishes the standards for reporting information about segments in financial statements. In applying the criteria set forth in ASC 280, the Company has determined that it has five reportable segments for financial reporting purposes. The Company’s five reportable segments are presented in the context of its two primary businesses - Building Technologies & Solutions and Power Solutions.

Effective July 1, 2017, the Company reorganized the reportable segments within its Building Technologies & Solutions business to align with its new management reporting structure and business activities. Prior to this reorganization, Building Technologies & Solutions was comprised of five reportable segments for financial reporting purposes: Systems and Service North America, Products North America, Asia, Rest of World and Tyco. As a result of this change, Building Technologies & Solutions is now comprised of four reportable segments for financial reporting purposes: Building Solutions North America, Building Solutions EMEA/LA, Building Solutions Asia Pacific and Global Products. Historical information has been revised to reflect the new Building Technologies & Solutions reportable segments.

A summary of the significant Building Technologies & Solutions reportable segment changes is as follows:


•	The “Systems and Service North America” segment is now part of the new “Building Solutions North America” reportable segment.

•

The North America Unitary Products business, Air Distribution Technologies business and refrigeration systems business, as well as HVAC products installed for Marine customers, previously included in the “Products North America” segment, are now part of the new reportable segment “Global Products.” The systems and products installation business for U.S. Navy customers, previously included in the “Products North America” segment, is now part of the new “Building Solutions North America” reportable segment.


•	The systems and service business within the former “Asia” segment is now part of the new “Building Solutions Asia Pacific” reportable segment. The HVAC products manufacturing business and the Johnson Controls-Hitachi joint venture, previously part of the “Asia” segment, are now part of the new “Global Products” reportable segment.


•	The systems and service businesses in Europe, the Middle East and Latin America within the former “Rest of World” segment are now part of the new “Building Solutions EMEA/LA” reportable segment. The HVAC products manufacturing businesses, previously part of the “Rest of World” segment, are now part of the new “Global Products” reportable segment.


•	As the Company has integrated the legacy Tyco business with its legacy Building Efficiency business for segment reporting purposes, Tyco is no longer a separate reportable segment. The Tyco businesses are now included throughout the new reportable segments.

Building Technologies & Solutions

•

Building Solutions North America designs, sells, installs, and services HVAC and controls systems, integrated electronic security systems (including monitoring), and integrated fire detection and suppression systems for commercial, industrial, retail, small business, institutional and governmental customers in North America. Building Solutions North America also provides energy efficiency solutions and technical services, including inspection, scheduled maintenance, and repair and replacement of mechanical and control systems, to non-residential building and industrial applications in the North American marketplace.


•	Building Solutions EMEA/LA designs, sells, installs, and services HVAC, controls, refrigeration, integrated electronic security, integrated fire detection and suppression systems, and provides technical services to markets in Europe, the Middle East, Africa and Latin America.


•	Building Solutions Asia Pacific designs, sells, installs, and services HVAC, controls, refrigeration, integrated electronic security, integrated fire detection and suppression systems, and provides technical services to the Asia Pacific marketplace.

•

Global Products designs and produces heating and air conditioning for residential and commercial applications, and markets products and refrigeration systems to replacement and new construction market customers globally. The Global Products business also designs, manufactures and sells fire protection and security products, including intrusion security, anti-theft devices, breathing apparatus and access control and video management systems, for commercial, industrial, retail, residential, small business, institutional and governmental customers worldwide. Global Products also includes the Johnson Controls-Hitachi joint venture, which was formed October 1, 2015, as well as the Scott Safety business, which was sold on October 4, 2017.

Power Solutions

Power Solutions services both automotive original equipment manufacturers and the battery aftermarket by providing advanced battery technology, coupled with systems engineering, marketing and service expertise.

Management evaluates the performance of its business segments primarily on segment earnings before interest, taxes and amortization ("EBITA"), which represents income from continuing operations before income taxes and noncontrolling interests, excluding general corporate expenses, intangible asset amortization, net financing charges, significant restructuring and impairment costs, and the net mark-to-market adjustments related to pension and postretirement plans.

Financial information relating to the Company’s reportable segments is as follows (in millions):



	Year Ended September 30,
	2017		2016		2015
Net Sales
Building Technologies & Solutions
Building Solutions North America	$	8,341	$	4,687	$	4,270
Building Solutions EMEA/LA	3,595		1,613		1,549
Building Solutions Asia Pacific	2,444		1,736		1,651
Global Products	8,455		6,148		3,040
	22,835		14,184		10,510
Power Solutions	7,337		6,653		6,590

Total net sales	$	30,172	$	20,837	$	17,100



	Year Ended September 30,
	2017			2016			2015
Segment EBITA
Building Technologies & Solutions
Building Solutions North America (1)	$	1,039		$	494		$	416
Building Solutions EMEA/LA (2)	290			74			45
Building Solutions Asia Pacific (3)	323			222			211
Global Products (4)	1,179			637			414
	2,831			1,427			1,086
Power Solutions (5)	1,427			1,327			1,241

Total segment EBITA	$	4,258		$	2,754		$	2,327

Amortization of intangible assets	(489		)	(116		)	(74		)
Corporate expenses (6)	(768		)	(607		)	(417		)
Net financing charges	(496		)	(289		)	(274		)
Restructuring and impairment costs	(367		)	(288		)	(215		)
Net mark-to-market adjustments on pension and postretirement plans	420			(393		)	(416		)

Income from continuing operations before income taxes	$	2,558		$	1,061		$	931



	September 30,
	2017		2016		2015
Assets
Building Technologies & Solutions (7)
Building Solutions North America	$	15,228	$	15,554	$	2,300
Building Solutions EMEA/LA (8)	4,885		4,649		1,022
Building Solutions Asia Pacific	2,575		2,521		978
Global Products (9)	14,018		15,782		5,083
	36,706		38,506		9,383
Power Solutions (10)	7,894		6,793		6,531
Assets held for sale	2,109		13,186		10,613
Unallocated	5,175		4,694		3,063

Total	$	51,884	$	63,179	$	29,590



	Year Ended September 30,
	2017		2016		2015
Depreciation/Amortization
Building Technologies & Solutions
Building Solutions North America	$	272	$	49	$	24
Building Solutions EMEA/LA	140		14		10
Building Solutions Asia Pacific	37		11		9
Global Products	410		230		138
	859		304		181
Power Solutions	236		238		286
Corporate	64		80		60
Discontinued Operations	29		331		333

Total	$	1,188	$	953	$	860



	Year Ended September 30,
	2017		2016		2015
Capital Expenditures
Building Technologies & Solutions
Building Solutions North America	$	107	$	16	$	17
Building Solutions EMEA/LA	98		19		17
Building Solutions Asia Pacific	27		7		8
Global Products	421		304		162
Global Workplace Solutions	—		—		13
	653		346		217
Automotive Experience
Seating	62		392		356
Interiors	1		3		99
	63		395		455
Power Solutions	481		357		252
Corporate	146		151		211

Total	$	1,343	$	1,249	$	1,135


(1)	Building Solutions North America segment EBITA for the years ended September 30, 2017 and 2015 excludes $59 million and $2 million, respectively, of restructuring and impairment costs.


(2)	Building Solutions EMEA/LA segment EBITA for the years ended September 30, 2017, 2016 and 2015 excludes $74 million, $17 million and $9 million, respectively, of restructuring and impairment costs. For the years ended September 30, 2017, 2016 and 2015, EMEA/LA segment EBITA includes $5 million, $11 million and $14 million, respectively, of equity income.


(3)	Building Solutions Asia Pacific segment EBITA for the years ended September 30, 2017 and 2015 excludes $16 million and $7 million, respectively, of restructuring and impairment costs. For the years ended September 30, 2017 and 2016, Asia Pacific segment EBITA includes $1 million and $1 million, respectively, of equity income.


(4)	Global Products segment EBITA for the years ended September 30, 2017, 2016 and 2015 excludes $32 million, $44 million and $20 million, respectively, of restructuring and impairment costs. For the years ended September 30, 2017, 2016 and 2015, Global Products segment EBITA includes $151 million, $114 million and $9 million, respectively, of equity income.


(5)	Power Solutions segment EBITA for the years ended September 30, 2017, 2016 and 2015 excludes $20 million, $66 million and $11 million, respectively, of restructuring and impairment costs. For the years ended September 30, 2017, 2016 and 2015, Power Solutions segment EBITA includes $83 million, $48 million and $57 million, respectively, of equity income.


(6)	Corporate expenses for the years ended September 30, 2017, 2016 and 2015 excludes $166 million, $161 million and $166 million, respectively, of restructuring and impairment costs.


(7)	Current year and prior year amounts exclude assets held for sale. Refer to Note 4, "Discontinued Operations," of the notes to consolidated financial statements for further information regarding the Company's disposal groups classified as held for sale.


(8)	Building Solutions EMEA/LA assets as of September 30 2017, 2016 and 2015, include $107 million, $103 million and $90 million, respectively, of investments in partially-owned affiliates.


(9)	Global Products assets as of September 30 2017, 2016 and 2015, include $637 million, $520 million and $64 million, respectively, of investments in partially-owned affiliates.


(10)	Power Solutions assets as of September 30 2017, 2016 and 2015, include $447 million, $367 million and $343 million, respectively, of investments in partially-owned affiliates.

In fiscal years 2017, 2016 and 2015, no customer exceeded 10% of consolidated net sales.

Geographic Segments

Financial information relating to the Company’s operations by geographic area is as follows (in millions):



	Year Ended September 30,
	2017		2016		2015
Net Sales
United States	$	14,495	$	9,633	$	8,982
China	2,046		1,620		1,350
Japan	1,816		1,805		315
Germany	1,779		1,430		911
United Kingdom	928		291		309
Mexico	840		639		635
Other foreign	5,408		3,602		2,637
Other European countries	2,860		1,817		1,961

Total	$	30,172	$	20,837	$	17,100

Long-Lived Assets (Year-end)
United States	$	3,155	$	2,880	$	2,056
China	535		484		415
Japan	180		188		8
Germany	290		287		304
United Kingdom	109		103		4
Mexico	489		457		368
Other foreign	821		785		252
Other European countries	542		448		276

Total	$	6,121	$	5,632	$	3,683

Net sales attributed to geographic locations are based on the location of the assets producing the sales. Long-lived assets by geographic location consist of net property, plant and equipment.