CNH Industrial(CNHI) - 2024 Q3 - Quarterly Report

Financial Performance - Net sales for Q3 2024 were $3,997 million, a decrease of 25% compared to $5,332 million in Q3 2023[8] - Total revenues for the nine months ended September 30, 2024, were $14,960 million, down 16% from $17,895 million in the same period of 2023[8] - Net income for Q3 2024 was $310 million, a decline of 43% from $540 million in Q3 2023[9] - Earnings per share for Q3 2024 were $0.24, compared to $0.40 in Q3 2023[8] - The company reported a comprehensive income of $301 million for Q3 2024, down from $483 million in Q3 2023[9] - The company reported a net income of $368 million for the nine months ended September 30, 2024, compared to $467 million for the same period in 2023, indicating a decrease of approximately 21.2%[13] - Basic earnings per share (EPS) for the three months ended September 30, 2024, was $0.24, a decrease of 40% compared to $0.40 for the same period in 2023[34] - The company reported a comprehensive loss of $58 million for Q3 2024, compared to a comprehensive income of $537 million in Q3 2023[16] Revenue Breakdown - Total revenues for Q3 2024 were $4,654 million, a decrease of 22.2% compared to $5,986 million in Q3 2023[8] - Agriculture segment revenue for Q3 2024 was $3,310 million, down 24.4% from $4,384 million in Q3 2023[29] - Construction segment revenue for Q3 2024 was $687 million, a decline of 27.5% compared to $948 million in Q3 2023[29] - Financial Services revenue for Q3 2024 was $659 million, slightly up from $653 million in Q3 2023[29] - Total industrial activities revenue for Q3 2024 was $3,997 million, down 25% from $5,332 million in Q3 2023[29] - Revenues from sales of goods for the nine months ended September 30, 2024, were $12,895 million, down 19.4% from $16,031 million in the prior year[30] Expenses and Liabilities - Research and development expenses for Q3 2024 were $221 million, a decrease of 17% compared to $266 million in Q3 2023[8] - Total liabilities decreased to $36,264 million as of September 30, 2024, from $38,117 million at the end of 2023[6] - The company incurred restructuring expenses of $12 million and $5 million during Q3 2024 and 2023, respectively, totaling $94 million and $8 million for the nine months ended September 30, 2024, and 2023[66] - Warranty and campaign program liabilities increased to $637 million as of September 30, 2024, from $610 million at the end of 2023[65] Cash and Cash Equivalents - Cash and cash equivalents were $1,801 million as of September 30, 2024, down from $4,322 million at December 31, 2023[6] - The total cash, cash equivalents, and restricted cash at the end of the period was $2,450 million, down from $3,685 million at the end of September 30, 2023, a decrease of 33.5%[11] - The company experienced a net increase in cash, cash equivalents, and restricted cash of $(2,595) million for the nine months ended September 30, 2024, compared to $(1,444) million for the same period in 2023, indicating a worsening cash position[11] Assets and Investments - Total assets as of September 30, 2024, were $44,033 million, down from $46,267 million as of December 31, 2023[6] - The company’s retained earnings increased to $10,136 million as of September 30, 2024, compared to $7,906 million as of September 30, 2023, reflecting an increase of 28.3%[14] - Total investments in unconsolidated subsidiaries and affiliates increased to $532 million as of September 30, 2024, from $479 million at the end of 2023, a rise of 11%[59] Acquisitions and Goodwill - The company completed the acquisition of Hemisphere for $181 million on October 12, 2023, enhancing its precision and automation technology[20] - CNH acquired a controlling interest in Bennamann for approximately $51 million on March 15, 2023[20] - The company purchased Augmenta for approximately $80 million on March 13, 2023, acquiring the remaining 89.5% it did not own[21] - Goodwill associated with the Hemisphere acquisition was preliminarily estimated at $111 million[20] - Goodwill increased to $3,615 million as of September 30, 2024, from $3,614 million at the beginning of the year, reflecting adjustments from acquisitions[60] Financing and Credit Quality - Proceeds from long-term debt increased to $13,094 million for the nine months ended September 30, 2024, compared to $7,510 million in the same period of 2023, marking a 74.5% increase[11] - The allowance for credit losses for retail financing increased to $400 million as of September 30, 2024, from $322 million at the beginning of the period[48] - The provision for credit losses increased due to specific reserve needs in South America, primarily related to Brazilian market conditions[49] - Total past due receivables in North America for 2024 amounted to $63 million, with a total performing balance of $8,932 million[51] Derivatives and Risk Management - The total notional amount of CNH's foreign exchange derivatives was $7.3 billion as of September 30, 2024, up from $6.1 billion at December 31, 2023[76] - The total notional amount of CNH's interest rate derivatives was approximately $9.2 billion as of September 30, 2024, compared to $9.0 billion at December 31, 2023[77] - The fair value of derivatives designated as hedging instruments totaled $133 million as of September 30, 2024, an increase from $91 million at December 31, 2023[83] - The company utilizes derivatives to mitigate exposure to interest rate and foreign currency risks, with no speculative purposes involved[75] Shareholder Information - EXOR N.V. held 45.3% of CNH's voting power as of September 30, 2024, allowing significant influence over shareholder decisions[96] - CNH did not enter into any significant transactions with EXOR N.V. during the nine months ended September 30, 2024[97]