| INVESTMENTS Equity Securities
The carrying values of our equity securities were included in the following line items in our consolidated balance sheets (in millions):
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|
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|
|
|
|
|
|
|
Fair Value with Changes Recognized in Income |
Measurement Alternative — No Readily Determinable Fair Value |
| September 29, 2023 |
|
|
|
|
|
| Marketable securities |
$ |
307
|
|
$ |
—
|
|
| Other investments |
63
|
|
41
|
|
| Other noncurrent assets |
1,429
|
|
—
|
|
| Total equity securities |
$ |
1,799
|
|
$ |
41
|
|
| December 31, 2022 |
|
|
|
|
|
| Marketable securities |
$ |
308 |
|
$ |
— |
|
| Other investments |
459 |
|
42 |
|
| Other noncurrent assets |
1,303 |
|
— |
|
| Total equity securities |
$ |
2,070 |
|
$ |
42 |
|
The calculation of net unrealized gains and losses recognized during the period related to equity securities still held at the end of the period is as follows (in millions):
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|
|
|
|
|
|
|
|
Three Months Ended |
|
September 29,
2023 |
September 30,
2022 |
| Net gains (losses) recognized during the period related to equity securities |
$ |
(61) |
|
$ |
(38) |
|
|
Less: Net gains (losses) recognized during the period related to equity securities sold
during the period
|
9
|
|
(95) |
|
|
Net unrealized gains (losses) recognized during the period related to equity securities
still held at the end of the period
|
$ |
(70) |
|
$ |
57 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended |
|
September 29,
2023 |
September 30,
2022 |
| Net gains (losses) recognized during the period related to equity securities |
$ |
194
|
|
$ |
(399) |
|
|
Less: Net gains (losses) recognized during the period related to equity securities sold
during the period
|
34
|
|
(350) |
|
|
Net unrealized gains (losses) recognized during the period related to equity securities
still held at the end of the period
|
$ |
160
|
|
$ |
(49) |
|
|
|
|
|
|
|
Debt Securities
Our debt securities consisted of the following (in millions):
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|
Gross Unrealized |
Estimated
Fair Value |
|
Cost |
Gains |
Losses |
| September 29, 2023 |
|
|
|
|
Trading securities |
$ |
43
|
|
$ |
—
|
|
$ |
(4) |
|
$ |
39
|
|
Available-for-sale securities |
1,099
|
|
22
|
|
(47) |
|
1,074
|
|
Total debt securities |
$ |
1,142
|
|
$ |
22
|
|
$ |
(51) |
|
$ |
1,113
|
|
| December 31, 2022 |
|
|
|
|
Trading securities |
$ |
43 |
|
$ |
— |
|
$ |
(4) |
|
$ |
39 |
|
Available-for-sale securities |
979 |
|
26 |
|
(61) |
|
944 |
|
Total debt securities |
$ |
1,022 |
|
$ |
26 |
|
$ |
(65) |
|
$ |
983 |
|
The carrying values of our debt securities were included in the following line items in our consolidated balance sheets (in millions):
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|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
September 29, 2023 |
|
December 31, 2022 |
|
Trading Securities |
Available-for-Sale Securities |
|
Trading Securities |
Available-for-Sale Securities |
|
|
|
|
|
|
Marketable securities |
$ |
39
|
|
$ |
874
|
|
|
$ |
39 |
|
$ |
722 |
|
Other noncurrent assets |
—
|
|
200
|
|
|
— |
|
222 |
|
| Total debt securities |
$ |
39
|
|
$ |
1,074
|
|
|
$ |
39 |
|
$ |
944 |
|
The contractual maturities of these available-for-sale debt securities as of September 29, 2023 were as follows (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost |
Estimated
Fair Value |
|
|
|
| Within 1 year |
$ |
479 |
|
$ |
472 |
|
|
|
|
| After 1 year through 5 years |
393 |
|
400 |
|
|
|
|
| After 5 years through 10 years |
35 |
|
43 |
|
|
|
|
| After 10 years |
192 |
|
159 |
|
|
|
|
| Total |
$ |
1,099 |
|
$ |
1,074 |
|
|
|
|
The Company expects that actual maturities may differ from the contractual maturities above because borrowers have the right to call or prepay certain obligations.
The sale and/or maturity of available-for-sale debt securities resulted in the following realized activity (in millions):
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|
|
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|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 29,
2023 |
September 30,
2022 |
|
September 29,
2023 |
September 30,
2022 |
| Gross gains |
$ |
—
|
|
$ |
2 |
|
|
$ |
2
|
|
$ |
5 |
|
| Gross losses |
(3) |
|
(43) |
|
|
(7) |
|
(51) |
|
| Proceeds |
184
|
|
135 |
|
|
292
|
|
479 |
|
Captive Insurance Companies
In accordance with local insurance regulations, our consolidated captive insurance companies are required to meet and maintain minimum solvency capital requirements. The Company elected to invest a majority of its solvency capital in a portfolio of marketable equity and debt securities. These securities are included in the disclosures above. The Company uses one of our consolidated captive insurance companies to reinsure group annuity insurance contracts that cover the obligations of certain of our European and Canadian pension plans. This captive’s solvency capital funds included total equity and debt securities of $1,484 million and $1,378 million as of September 29, 2023 and December 31, 2022, respectively, which were classified in the line item other noncurrent assets in our consolidated balance sheets because the assets were not available to satisfy our current obligations.
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