Company Quick10K Filing
Harris
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$0.00 120 $22,830
10-Q 2019-10-31 Quarter: 2019-09-27
10-K 2019-08-22 Annual: 2019-06-28
10-Q 2019-05-02 Quarter: 2019-03-29
10-Q 2019-01-30 Quarter: 2018-12-28
10-Q 2018-10-26 Quarter: 2018-09-28
10-K 2018-08-27 Annual: 2018-06-29
10-Q 2018-05-03 Quarter: 2018-03-30
10-Q 2018-01-31 Quarter: 2017-12-29
10-Q 2017-10-31 Quarter: 2017-09-29
10-K 2017-08-29 Annual: 2017-06-30
10-Q 2017-05-03 Quarter: 2017-03-31
10-Q 2017-02-03 Quarter: 2016-12-30
10-Q 2016-11-02 Quarter: 2016-09-30
10-K 2016-08-29 Annual: 2016-07-01
10-Q 2016-05-04 Quarter: 2016-04-01
10-Q 2016-02-03 Quarter: 2016-01-01
10-Q 2015-11-06 Quarter: 2015-10-02
10-K 2015-08-31 Annual: 2015-07-03
10-Q 2015-05-06 Quarter: 2015-04-03
10-Q 2015-02-10 Quarter: 2015-01-02
10-Q 2014-10-29 Quarter: 2014-09-26
10-K 2014-08-25 Annual: 2014-06-27
10-Q 2014-04-30 Quarter: 2014-03-28
10-Q 2014-01-29 Quarter: 2013-12-27
10-Q 2013-10-30 Quarter: 2013-09-27
10-K 2013-08-26 Annual: 2013-06-28
10-Q 2013-05-01 Quarter: 2013-03-29
10-Q 2013-01-30 Quarter: 2012-12-28
10-Q 2012-10-31 Quarter: 2012-09-28
10-K 2012-08-27 Annual: 2012-06-29
10-Q 2012-05-02 Quarter: 2012-03-30
10-Q 2012-02-01 Quarter: 2011-12-30
10-Q 2011-10-27 Quarter: 2011-09-30
10-K 2011-08-29 Annual: 2011-07-01
10-Q 2011-05-04 Quarter: 2011-04-01
10-Q 2011-01-27 Quarter: 2010-12-31
10-Q 2010-10-28 Quarter: 2010-10-01
10-K 2010-08-30 Annual: 2010-07-02
10-Q 2010-04-29 Quarter: 2010-04-02
10-Q 2010-01-28 Quarter: 2010-01-01
8-K 2019-12-16 Other Events
8-K 2019-12-13 Other Events
8-K 2019-11-27 Other Events, Exhibits
8-K 2019-11-14 Other Events
8-K 2019-11-14 Other Events, Exhibits
8-K 2019-10-30 Earnings, Regulation FD, Exhibits
8-K 2019-10-30 Shareholder Vote
8-K 2019-09-11 Other Events, Exhibits
8-K 2019-08-02 Other Events
8-K 2019-07-31 Other Events, Exhibits
8-K 2019-07-31 Earnings, Regulation FD, Exhibits
8-K 2019-07-01 Off-BS Arrangement, Other Events, Exhibits
8-K 2019-06-28 Enter Agreement, Leave Agreement, M&A, Earnings, Off-BS Arrangement, Officers, Regulation FD, Other Events, Exhibits
8-K 2019-06-28 Amend Bylaw, Exhibits
8-K 2019-06-20 Other Events, Exhibits
8-K 2019-06-13 Other Events, Exhibits
8-K 2019-05-30 Other Events, Exhibits
8-K 2019-05-30 Other Events, Exhibits
8-K 2019-05-01 Earnings, Regulation FD, Exhibits
8-K 2019-04-05 Regulation FD, Exhibits
8-K 2019-04-04 Shareholder Vote, Other Events, Exhibits
8-K 2019-02-25 Other Events, Exhibits
8-K 2019-01-29 Earnings, Regulation FD, Exhibits
8-K 2019-01-11 Other Events
8-K 2018-12-13 Other Events, Exhibits
8-K 2018-12-10 Other Events
8-K 2018-10-26 Shareholder Vote
8-K 2018-10-15 Earnings, Regulation FD, Other Events, Exhibits
8-K 2018-10-12 Enter Agreement, Officers, Exhibits
8-K 2018-08-30 Officers, Amend Bylaw, Exhibits
8-K 2018-07-31 Earnings, Regulation FD, Exhibits
8-K 2018-06-28 Enter Agreement, Leave Agreement, Off-BS Arrangement, Exhibits
8-K 2018-06-25 Other Events
8-K 2018-06-04 Other Events, Exhibits
8-K 2018-05-30 Amend Bylaw, Exhibits
8-K 2018-05-29 Other Events, Exhibits
8-K 2018-05-24 Other Events
8-K 2018-05-02 Earnings, Regulation FD, Exhibits
8-K 2018-04-27 Officers, Exhibits
8-K 2018-02-27 Other Events, Exhibits
8-K 2018-01-30 Earnings, Regulation FD, Exhibits
HRS 2019-09-27
Part I. Financial Information
Item 1. Financial Statements.
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Item 4. Controls and Procedures.
Part II. Other Information
Item 1. Legal Proceedings.
Item 1A. Risk Factors.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 3. Defaults Upon Senior Securities.
Item 4. Mine Safety Disclosures.
Item 5. Other Information.
Item 6. Exhibits.
EX-10.3 exhibit103ceo-coopsutcs.htm
EX-10.4 exhibit104momentumpsut.htm
EX-10.5 exhibit105ceo-coopsotcs.htm
EX-10.6 exhibit106momentumpsot.htm
EX-10.7 exhibit107integrationp.htm
EX-10.8 exhibit108integration-.htm
EX-10.9 exhibit109new-hireothe.htm
EX-15 exhibit15927201910-qst.htm
EX-31.1 exhibit311927201910-qs.htm
EX-31.2 exhibit312927201910-qs.htm
EX-32.1 exhibit321927201910-qs.htm
EX-32.2 exhibit322927201910-qs.htm

Harris Earnings 2019-09-27

HRS 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

Comparables ($MM TTM)
Ticker M Cap Assets Liab Rev G Profit Net Inc EBITDA EV G Margin EV/EBITDA ROA
LRCX 29,765 12,001 7,278 9,654 4,358 2,191 2,873 30,364 45% 10.6 18%
CAJ 29,533 4,899,465 1,881,552 0 0 0 0 -126,510 0%
FTV 27,317 16,468 9,456 7,055 3,539 2,697 2,918 32,421 50% 11.1 16%
CMI 26,885 20,254 11,058 24,294 6,270 2,662 3,972 27,688 26% 7.0 13%
HRS 22,830 10,117 6,754 6,801 2,334 681 1,153 25,743 34% 22.3 7%
SWK 21,509 21,524 13,296 14,224 4,804 669 1,728 25,477 34% 14.7 3%
ROK 19,460 6,159 5,002 6,694 2,910 1,034 1,569 20,912 43% 13.3 17%
KEYS 19,020 6,348 3,410 3,183 1,869 312 742 19,416 59% 26.2 5%
GRMN 15,309 5,525 1,374 3,463 2,057 738 875 14,488 59% 16.6 13%
DOV 14,503 8,776 7,092 2,588 603 990 17,128 36% 17.3 7%

Document
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l3harrislogoa10.jpg
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 27, 2019
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                              to                            _
Commission File Number: 1-3863
L3HARRIS TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Delaware
 
34-0276860
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
1025 West NASA Boulevard
 
 
Melbourne,
Florida
 
 
32919
(Address of principal executive offices)
 
(Zip Code)
Registrant’s telephone number, including area code: (321727-9100
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Common Stock, par value $1.00 per share
 
LHX
 
New York Stock Exchange
Indicate by check mark whether the registrant (l) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.                                                                         þ   Yes    o  No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).                                                     þ  Yes    o  No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
 
þ
  
 
Accelerated filer
o
Non-accelerated filer
 
o
  
 
Smaller reporting company
Emerging growth company
 
 
 
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).       Yes    þ  No
The number of shares outstanding of the registrant’s common stock as of October 25, 2019 was 221,064,649 shares.



L3HARRIS TECHNOLOGIES, INC.
FORM 10-Q
For the Quarter Ended September 27, 2019
TABLE OF CONTENTS
 
Page
No.
Part I. Financial Information:
 
Item 1. Financial Statements (Unaudited):
 
Condensed Consolidated Statement of Income for the Quarter Ended September 27, 2019 and September 28, 2018
Condensed Consolidated Statement of Comprehensive Income for the Quarter Ended September 27, 2019 and September 28, 2018
Condensed Consolidated Balance Sheet at September 27, 2019 and June 28, 2019
Condensed Consolidated Statement of Cash Flows for the Quarter Ended September 27, 2019 and September 28, 2018
Condensed Consolidated Statement of Equity for the Quarter Ended September 27, 2019 and September 28, 2018
Notes to Condensed Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
 
 
Part II. Other Information:
 
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
 
 
Signature
This Report contains trademarks, service marks and registered marks of L3Harris Technologies, Inc. and its subsidiaries. All other trademarks are the property of their respective owners.




PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
L3HARRIS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
 
Quarter Ended
 
September 27, 2019
 
September 28, 2018
 
 
 
 
 
(In millions, except per share amounts)
Revenue from product sales and services
$
4,431

 
$
1,542

Cost of product sales and services
(3,242
)
 
(1,010
)
Engineering, selling and administrative expenses
(999
)
 
(279
)
Gain on sale of business
229

 

Non-operating income
79

 
47

Interest income
9

 
1

Interest expense
(67
)
 
(44
)
Income from continuing operations before income taxes
440

 
257

Income taxes
(5
)
 
(41
)
Income from continuing operations
435

 
216

Discontinued operations, net of income taxes

 
(3
)
Net income
435

 
213

Noncontrolling interests, net of income taxes
(6
)
 

Net income attributable to L3Harris Technologies, Inc.
$
429

 
$
213

Amounts attributable to L3Harris Technologies, Inc. common shareholders
 
 
 
Income from continuing operations
$
429

 
$
216

Discontinued operations, net of income taxes

 
(3
)
Net income
$
429

 
$
213

 
 
 
 
Net income per common share attributable to L3Harris Technologies, Inc. common shareholders
 
 
 
Basic
 
 
 
Continuing operations
$
1.93

 
$
1.82

Discontinued operations

 
(0.01
)
 
$
1.93

 
$
1.81

Diluted
 
 
 
Continuing operations
$
1.90

 
$
1.78

Discontinued operations

 
(0.01
)
 
$
1.90

 
$
1.77

 
 
 
 
Basic weighted average common shares outstanding
222.6

 
117.9

Diluted weighted average common shares outstanding
225.4

 
120.6

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

1


L3HARRIS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(Unaudited) 
 
Quarter Ended
 
September 27, 2019
 
September 28, 2018
 
 
 
 
 
(In millions)
Net income
$
435

 
$
213

Other comprehensive loss:
 
 
 
Foreign currency translation loss, net of income taxes
(25
)
 

Net unrealized gain (loss) on hedging derivatives, net of income taxes
(38
)
 
1

Net unrecognized loss on postretirement obligations, net of income taxes

 
(1
)
Other comprehensive loss, net of income taxes
(63
)
 

Total comprehensive income
372

 
213

Comprehensive income attributable to noncontrolling interests
(6
)
 

Total comprehensive income attributable to L3Harris Technologies, Inc.
$
366

 
$
213

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

2


L3HARRIS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
 
September 27,
2019
 
June 28,
2019
 
 
 
 
 
(In millions, except shares)
Assets
 
 
 
Current Assets
 
 
 
Cash and cash equivalents
$
1,001

 
$
530

Receivables
1,275

 
457

Contract assets
2,625

 
807

Inventories
1,339

 
360

Income taxes receivable
291

 
191

Other current assets
496

 
100

Assets of disposal group held for sale

 
133

Total current assets
7,027

 
2,578

Non-current Assets
 
 
 
Property, plant and equipment
2,073

 
894

Operating lease right-of-use assets
934

 

Goodwill
20,749

 
5,340

Other intangible assets
7,516

 
870

Deferred income taxes
124

 
173

Other non-current assets
524

 
262

Total non-current assets
31,920

 
7,539

 
$
38,947

 
$
10,117

Liabilities and Equity
 
 
 
Current Liabilities
 
 
 
Short-term debt
$
3

 
$
103

Accounts payable
1,423

 
525

Contract liabilities
1,210

 
496

Compensation and benefits
521

 
161

Other accrued items
881

 
283

Income taxes payable
24

 
8

Current portion of long-term debt, net
656

 
656

Liabilities of disposal group held for sale

 
36

Total current liabilities
4,718

 
2,268

Non-current Liabilities
 
 
 
Defined benefit plans
2,145

 
1,174

Operating lease liabilities
831

 

Long-term debt, net
6,307

 
2,763

Deferred income taxes
1,192

 
12

Other long-term liabilities
829

 
537

Total non-current liabilities
11,304

 
4,486

Equity
 
 
 
Shareholders’ Equity:
 
 
 
Preferred stock, without par value; 1,000,000 shares authorized; none issued

 

Common stock, $1.00 par value; 500,000,000 shares authorized; issued and outstanding 221,568,390 shares at September 27, 2019 and 118,552,599 shares at June 28, 2019
222

 
119

Other capital
21,288

 
1,778

Retained earnings
2,019

 
2,173

Accumulated other comprehensive loss
(756
)
 
(707
)
Total shareholders’ equity
22,773

 
3,363

Noncontrolling interests
152

 

Total equity
22,925

 
3,363

 
$
38,947

 
$
10,117

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

3


L3HARRIS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 
Quarter Ended
 
September 27, 2019
 
September 28, 2018
 
 
 
 
 
(In millions)
Operating Activities
 
 
 
Net income
$
435

 
$
213

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
201

 
65

Share-based compensation
143

 
38

Qualified pension plan contributions
(327
)
 

Pension and other postretirement benefit plan income
(58
)
 
(38
)
Gain on sale of business, net
(229
)
 

Gain on sale of asset group
(12
)
 

Deferred income taxes

 
9

(Increase) decrease in:
 
 
 
Accounts receivable
31

 
34

Contract assets
(110
)
 
(88
)
Inventories
75

 
(3
)
Increase (decrease) in:
 
 
 
Accounts payable

 
(141
)
Contract liabilities
(7
)
 
38

Compensation and benefits
37

 
(16
)
Income taxes
(28
)
 
28

Other accrued items
7

 
(6
)
Other
(77
)
 
(16
)
Net cash provided by operating activities
81

 
117

Investing Activities
 
 
 
Net additions of property, plant and equipment
(84
)
 
(31
)
Proceeds from sale of business, net
346

 

Net cash acquired in L3Harris Merger
1,132

 

Proceeds from sale of asset group
20

 

Net cash provided by (used in) investing activities
1,414

 
(31
)
Financing Activities
 
 
 
Net proceeds from borrowings
3

 
216

Repayments of borrowings
(100
)
 

Proceeds from exercises of employee stock options
95

 
15

Repurchases of common stock
(750
)
 
(200
)
Cash dividends
(177
)
 
(82
)
Other financing activities
(85
)
 
(18
)
Net cash used in financing activities
(1,014
)
 
(69
)
Effect of exchange rate changes on cash and cash equivalents
(10
)
 

Net increase in cash and cash equivalents
471

 
17

Cash and cash equivalents, beginning of year
530

 
288

Cash and cash equivalents, end of quarter
$
1,001

 
$
305

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

4


L3HARRIS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF EQUITY
(Unaudited)
 
Common
Stock
 
Other
Capital
 
Retained
Earnings
 
Accumulated Other
Comprehensive Loss
 
Non-controlling
Interests
 
Total
Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions, except per share amounts)
Balance at June 28, 2019
$
119

 
$
1,778

 
$
2,173

 
$
(707
)
 
$

 
$
3,363

Net income

 

 
429

 

 
6

 
435

Other comprehensive loss

 

 

 
(63
)
 

 
(63
)
Shares issued for L3Harris Merger
104

 
19,696

 

 

 

 
19,800

Equity issuance costs

 
(2
)
 

 

 

 
(2
)
Net loss from postretirement obligations and hedging derivatives reclassified to earnings

 

 

 
14

 

 
14

Shares issued under stock incentive plans
2

 
93

 

 

 

 
95

Shares issued under defined contribution plans

 
48

 

 

 

 
48

Share-based compensation expense

 
94

 

 

 

 
94

Repurchases and retirement of common stock
(3
)
 
(419
)
 
(411
)
 

 

 
(833
)
Cash dividends ($.75 per share)

 

 
(172
)
 

 

 
(172
)
Distributions to noncontrolling interests

 

 

 

 
(5
)
 
(5
)
Fair value of noncontrolling interests recognized in purchase accounting

 

 

 

 
151

 
151

Balance at September 27, 2019
$
222

 
$
21,288

 
$
2,019

 
$
(756
)
 
$
152

 
$
22,925

 
 
 
 
 
 
 
 
 
 
 
 
Balance at June 29, 2018
$
118

 
$
1,714

 
$
1,648

 
$
(202
)
 
$

 
$
3,278

Net income

 

 
213

 

 

 
213

Shares issued under stock incentive plans
1

 
15

 

 

 

 
16

Shares issued under defined contribution plans

 
23

 

 

 

 
23

Share-based compensation expense

 
14

 

 

 

 
14

Repurchases and retirement of common stock
(1
)
 
(118
)
 
(99
)
 

 

 
(218
)
Cash dividends ($.685 per share)

 

 
(82
)
 

 

 
(82
)
Balance at September 28, 2018
$
118

 
$
1,648

 
$
1,680

 
$
(202
)
 
$

 
$
3,244

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

5


NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Note A — Significant Accounting Policies and Recent Accounting Standards
Basis of Presentation
On October 12, 2018, Harris Corporation, a Delaware corporation (“Harris”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with L3 Technologies, Inc., a Delaware corporation (“L3”), and Leopard Merger Sub Inc., a Delaware corporation and a newly formed, direct wholly owned subsidiary of Harris (“Merger Sub”), pursuant to which Harris and L3 agreed to combine their respective businesses in an all-stock merger, at the closing of which Merger Sub would merge with and into L3, with L3 continuing as the surviving corporation and a direct wholly owned subsidiary of Harris (the “L3Harris Merger”).
The closing of the L3Harris Merger occurred on June 29, 2019 (“Closing Date”), the day after Harris’ fiscal 2019 ended and the first day of the quarter ended September 27, 2019. Upon completion of the L3Harris Merger, Harris was renamed “L3Harris Technologies, Inc.” (“L3Harris”), and each share of L3 common stock converted into the right to receive 1.30 shares (“Exchange Ratio”) of L3Harris common stock. Shares of L3Harris common stock, which previously traded under ticker symbol “HRS” on the New York Stock Exchange (“NYSE”) prior to completion of the L3Harris Merger, are traded under ticker symbol “LHX” following completion of the L3Harris Merger. L3Harris was owned on a fully diluted basis approximately 54 percent by Harris shareholders and 46 percent by L3 shareholders immediately following the completion of the L3Harris Merger.
The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) requires that the accompanying Condensed Consolidated Financial Statements (Unaudited) and most of the disclosures in these Notes to Consolidated Financial Statements (Unaudited) (these “Notes”) be presented on a historical basis for periods prior to the closing of the L3Harris Merger. Unless the context otherwise requires, the terms “we,” “our,” “us,” “Company” and “L3Harris” as used in this Quarterly Report on Form 10-Q (this “Report”) mean Harris and its subsidiaries when referring to periods prior to the end of fiscal 2019 (prior to the L3Harris Merger) and to the combined company L3Harris Technologies, Inc. and its consolidated subsidiaries when referring to periods after the end of fiscal 2019 (after the L3Harris Merger).
We are accounting for the L3Harris Merger under the acquisition method of accounting. Under the acquisition method of accounting, we are required to measure identifiable assets acquired, liabilities assumed and any noncontrolling interests in the acquiree at their fair values as of the Closing Date. The excess of the consideration transferred over those fair values is recorded as goodwill. See Note B — Business Combination in these Notes for additional information related to the L3Harris Merger.
The accompanying Condensed Consolidated Financial Statements (Unaudited) have been prepared by L3Harris, without an audit, in accordance with GAAP for interim financial information and with the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, such interim financial statements do not include all information and footnotes necessary for a complete presentation of financial condition, results of operations, cash flows and equity in conformity with GAAP for annual financial statements. In the opinion of management, such interim financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of our financial condition, results of operations and cash flows for the periods presented therein. The results for the quarter ended September 27, 2019 are not necessarily indicative of the results that may be expected for the Fiscal Transition Period (as defined below) or any subsequent period. The balance sheet at June 28, 2019 has been derived from our audited financial statements, but does not include all of the information and footnotes required by GAAP for annual financial statements. We provide complete, audited financial statements in our Annual Report on Form 10-K, which includes information and footnotes required by the rules and regulations of the SEC. The information included in this Report should be read in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements and accompanying Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended June 28, 2019 (our “Fiscal 2019 Form 10-K”).
We implemented a new organizational structure effective on June 29, 2019, which resulted in changes to our operating segments, which are also reportable segments and referred to as our business segments. The historical results, discussion and presentation of our business segments as set forth in the accompanying Condensed Consolidated Financial Statements (Unaudited) and these Notes reflect the impact of these changes for all periods presented in order to present segment information on a comparable basis. There is no impact on our previously reported consolidated statements of income, balance sheets, statements of cash flows or statements of equity resulting from these changes.
On September 13, 2019, we completed the sale of the Harris Night Vision business to Elbit Systems of America, LLC, a subsidiary of Elbit Systems Ltd., for $350 million (net cash proceeds of $346 million after selling costs and estimated purchase price adjustments), subject to final customary purchase price adjustments as set forth in the definitive agreement. The Harris Night Vision business was not included in any of the operating segments in our new organizational structure and the operating

6


results of the Harris Night Vision business through the date of the divestiture are discussed and presented as part of “Other non-reportable business segments” in this Report.
See Note C — Business Divestitures and Asset Sales in these Notes for more information regarding the divestiture of the Harris Night Vision business.
Amounts contained in this Report may not always add to totals due to rounding.
Change in Fiscal Year
Through fiscal 2019, our fiscal year ended on the Friday nearest June 30. Commencing June 29, 2019, our fiscal year will end on the Friday nearest December 31, and the period commencing on June 29, 2019 will be a fiscal transition period ending on January 3, 2020 (the “Fiscal Transition Period”). We will file a transition report on Form 10-KT containing audited financial statements for the Fiscal Transition Period.
Use of Estimates
The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the accompanying Condensed Consolidated Financial Statements (Unaudited) and these Notes and related disclosures. These estimates and assumptions are based on experience and other information available prior to issuance of the accompanying Condensed Consolidated Financial Statements (Unaudited) and these Notes. Materially different results can occur as circumstances change and additional information becomes known.
Significant Accounting Policies Update
There have been no material changes to our significant accounting policies described in our Fiscal 2019 Form 10-K, except as described in “Adoption of New Accounting Standards” below.
Adoption of New Accounting Standards
Effective June 29, 2019, we adopted Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), as amended (“ASC 842”) using the optional transition method. We initially applied ASC 842 for leases existing as of June 29, 2019 and recognized $270 million of right-of-use (“ROU”) assets and $289 million of lease liabilities in our Condensed Consolidated Balance Sheet (Unaudited). See Note B — Business Combination in these Notes for ROU assets and lease liabilities assumed as part of the L3Harris Merger.
In accordance with ASC 842, we recognized ROU assets and liabilities in our balance sheet for operating and finance leases under which we are the lessee, except for equipment leases and, as permitted by a practical expedient under ASC 842, leases with a term of 12 months or less. Equipment leases were not material at September 27, 2019 and June 29, 2019. We also elected the package of practical expedients permitted under ASC 842 and did not reassess lease classification for existing or expired leases, whether expired or existing contracts contain a lease under the new definition of a lease or whether previously capitalized initial direct costs would qualify for capitalization under ASC 842.
Operating lease assets are classified as operating ROU assets, operating lease liabilities for obligations due within 12 months are classified as other current liabilities and operating lease liabilities for obligations due longer than 12 months are classified as other long-term liabilities. Finance lease assets are classified as property, plant and equipment. Finance lease liabilities are classified as other current liabilities or other long-term liabilities depending on when the obligation is due.
Lease assets and liabilities are recognized based on the present value of future lease payments. Lease payments primarily include base rent. We have some lease payments that are based on an index and changes to the index are treated as variable lease payments and recognized in the period in which the obligation for those payments is incurred. Our leases also include non-lease components such as real estate taxes and common-area maintenance costs. We elected the practical expedient to account for lease and non-lease components as a single component. In certain of our leases, the non-lease components are variable and are therefore excluded from lease payments to determine the lease asset. The present value of future lease payments is determined using our incremental borrowing rate at lease commencement over the expected lease term. We use our incremental borrowing rate because our lessee leases do not provide an implicit lease rate. The expected lease term represents the number of years we expect to lease the property, including options to extend or terminate the lease when it is reasonably certain that we will exercise such option.
Operating lease expense is recognized as an operating cost on a straight-line basis over the expected lease term in our Condensed Consolidated Statement of Income (Unaudited). For finance leases, the asset is amortized on a straight-line basis over the lease term, and interest on the lease liability is recognized in interest expense. The amortization of lease assets for our finance leases and interest expense was not material for the quarter ended September 27, 2019.
We are a lessor for certain arrangements for flight simulators. These leases meet the criteria for operating lease classification. Lease income associated with these leases was not material for the quarter ended September 27, 2019.

7


Adoption of ASC 842 did not have a material effect on our results of operations or cash flows.
Effective June 29, 2019, we adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The amendments in this update are intended to better align companies’ risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedge relationships and the presentation of hedge results. The amendments in this update require companies to present the earnings effect of the hedging instrument in the same income statement line in which the earnings effect of the hedged item is reported. Prior to the adoption of this update, GAAP provided hedge accounting for only the portion of the hedge deemed to be highly effective and required companies to separately reflect the amount by which the hedging instrument did not offset the hedged item, which is referred to as the ineffective amount. The amendments in this update include, among other items, removal of the requirement that companies separately measure and recognize in earnings the ineffective amount for highly effective hedges. Adoption of this standard did not have a material effect on our financial condition, results of operations or cash flows.
Note B — Business Combination
On October 12, 2018, Harris entered into the Merger Agreement with L3 and Merger Sub, pursuant to which Harris and L3 agreed to combine their respective businesses in an all-stock merger, at the closing of which Merger Sub would merge with and into L3, with L3 continuing as the surviving corporation and a direct wholly owned subsidiary of Harris.
The closing of the L3Harris Merger occurred on June 29, 2019, the first day of the quarter ended September 27, 2019. Upon completion of the L3Harris Merger, Harris was renamed “L3Harris Technologies, Inc.” and each share of L3 common stock converted into the right to receive 1.30 shares of L3Harris common stock. L3Harris was owned on a fully diluted basis approximately 54 percent by Harris shareholders and 46 percent by L3 shareholders immediately following the completion of the L3Harris Merger.
L3 was a prime contractor in intelligence, surveillance and reconnaissance (“ISR”) systems, aircraft sustainment (including modifications and fleet management of special mission aircraft), simulation and training, night vision and image intensification equipment, and security and detection systems. L3 also was a leading provider of a broad range of communication, electronic and sensor systems used on military, homeland security and commercial platforms. L3 employed approximately 31,000 employees and its customers included the U.S. Department of Defense and its prime contractors, the U.S. Intelligence Community, the U.S. Department of Homeland Security, foreign governments and domestic and foreign commercial customers. L3 generated calendar 2018 revenue of approximately $10 billion.
As a result of the L3Harris Merger, L3Harris is an agile global aerospace and defense technology innovator, delivering end-to-end solutions that meet customers’ mission-critical needs, with approximately 50,000 employees and customers in 130 countries. We provide advanced defense and commercial technologies across air, land, sea, space and cyber domain.
Approximately 104 million shares of L3Harris common stock were issued to L3 shareholders following the completion of the L3Harris Merger. The trading price of L3Harris common stock was $189.13 per share as of the Closing Date. In addition, replacement L3Harris share-based awards were issued for certain outstanding L3 share-based awards.
We are accounting for the L3Harris Merger under the acquisition method of accounting. Under the acquisition method of accounting, we are required to measure identifiable assets acquired, liabilities assumed and any noncontrolling interests in the acquiree at their fair values as of the Closing Date. Due to the timing of the L3Harris Merger relative to its size and complexity, our accounting for the L3Harris Merger is preliminary. The acquisition-date fair value estimates for consideration transferred, identifiable assets acquired, liabilities assumed and noncontrolling interests are based on preliminary calculations and our estimates and assumptions are subject to change as we obtain additional information during the measurement period (up to one year from the Closing Date).

8


Our preliminary calculation of estimated consideration transferred is summarized below:
 
(In millions, except exchange ratio and per share amounts)
Outstanding shares of L3 common stock as of June 28, 2019
79.63

L3 restricted stock unit awards settled in shares of L3Harris common stock
0.41

L3 performance unit awards settled in shares of L3Harris common stock
0.04


80.08

Exchange Ratio
1.30

Shares of L3Harris common stock issued for L3 outstanding common stock
104.10

Price per share of L3Harris common stock as of June 28, 2019
$
189.13

Fair value of L3Harris common stock issued for L3 outstanding common stock
$
19,689

Fair value of replacement RSUs attributable to merger consideration
10

Fair value of L3Harris stock options issued for L3 outstanding stock options
101

Withholding tax liability incurred for converted L3 share-based awards
45

Fair value of replacement award consideration
156

Fair value of total consideration
19,845

Less cash acquired
(1,195
)
Total net consideration transferred
$
18,650


Our preliminary measurement of assets acquired, liabilities assumed and nonconrolling interests is summarized below:
 
(In millions)
Receivables
$
849

Contract assets
1,708

Inventories
1,056

Other current assets
517

Property, plant and equipment
1,176

Operating lease right-of-use assets
704

Goodwill
15,423

Other intangible assets
6,768

Other non-current assets
327

Total assets acquired
$
28,528

 
 
Accounts payable
$
898

Contract liabilities
722

Other current liabilities
772

Operating lease liabilities
715

Defined benefit plans
1,411

Long-term debt, net
3,548

Other long-term liabilities
1,661

Total liabilities assumed
9,727

Net assets acquired
18,801

Noncontrolling interests
(151
)
Total net consideration transferred
$
18,650


The goodwill resulting from the L3Harris Merger was primarily associated with L3’s market presence and leading positions, growth opportunities in the markets in which L3 businesses operate, experienced work force and established operating infrastructures. Most of the goodwill related to the L3Harris Merger is nondeductible for tax purposes. As described in more detail in Note X — Business Segment Information in these Notes, we adjusted our segment reporting to reflect our new organizational structure commencing with the quarter ended September 27, 2019. Under the revised reporting structure, our Integrated Mission Systems segment is comprised almost entirely of L3 operating businesses, as of the acquisition date, whereas our other segments are comprised of both L3 and Harris operating businesses.

9


See Note K — Goodwill and Other Intangible Assets in these Notes for more information regarding the preliminary allocation of goodwill by reportable business segment under the revised reporting structure.
The following table provides further detail of the fair value and weighted-average amortization period of identified intangible assets acquired by major intangible asset class:
 
Weighted Average Amortization Period
 
Total
 
 
 
 
 
(In years)
 
(In millions)
Identifiable intangible assets acquired:

 
 
Customer relationships (Government)
15
 
$
3,549

Customer relationships (Commercial)
16
 
561

Trade names — Divisions
10
 
162

Developed technology
8
 
630

Total identifiable intangible assets subject to amortization

14
 
4,902

Trade names — Corporate
indefinite
 
1,803

In-process research and development
n/a
 
63

Total identifiable intangible assets
 
 
$
6,768


During the quarter ended September 27, 2019, we recorded $373 million of L3Harris Merger-related charges, consisting of restructuring, integration, transaction and other costs as follows:
$74 million of transaction costs, recognized as incurred;
$35 million of integration costs, recognized as incurred;
$61 million of equity award acceleration charges, recognized upon change in control;
$92 million of additional cost of sales related to the fair value step-up in inventory sold; and
$111 million of restructuring costs as discussed in Note E — Restructuring and Other Exit Costs in these Notes.
Because the L3Harris Merger benefited the entire Company as opposed to any individual business segment, the above costs were not allocated to any business segment. All of the costs above were recorded in the “Engineering, selling and administrative expenses” line item in our Condensed Consolidated Statement of Income (Unaudited), except for the $92 million of additional cost of sales related to the fair value step-up in inventory sold, which is included in the “Cost of product sales and services” line item in our Condensed Consolidated Statement of Income (Unaudited).
Pro Forma Results
The following summary, prepared on a pro forma basis, presents our unaudited consolidated results of operations for the quarter ended September 28, 2018 as if the L3Harris Merger had been completed as of the beginning of the quarter ended September 28, 2018, after including any post-acquisition adjustments directly attributable to the acquisition, such as the sale of Harris’ Night Vision business, and after including the impact of adjustments such as amortization of intangible assets as well as the related income tax effects. This pro forma presentation does not include any impact of transaction synergies. The pro forma results are not necessarily indicative of our results of operations that actually would have been obtained had the combination of Harris and L3 been completed on the assumed date or for the period presented, or which may be realized in the future.
 
September 28, 2018
 
 
 
(In millions)
Revenue from product sales and services — as reported
$
1,542

Revenue from product sales and services — pro forma

$
4,018

Income from continuing operations — as reported
$
216

Income from continuing operations — pro forma
$
373


For the quarter ended September 27, 2019, our Condensed Consolidated Statement of Income (Unaudited) includes the results of L3 operating businesses from the Closing Date, with total revenue of approximately $2.67 billion (net of intercompany sales between L3 operating businesses) and income from continuing operations before income taxes of approximately $0.19 billion (including $92 million of additional cost of sales related to the fair value step-up in inventory sold and $101 million of restructuring charges for workforce reductions associated with the L3Harris Merger).
Note C — Business Divestitures and Asset Sales
Harris Night Vision. On September 13, 2019, we completed the sale of the Harris Night Vision business, a global supplier of high-performance, vision-enhancing products for U.S. and allied military and security forces and commercial customers, for

10


$350 million (net cash proceeds of $346 million after selling costs and estimated purchase price adjustments), subject to final customary purchase price adjustments pursuant to a definitive agreement we entered into on April 4, 2019 as part of the regulatory process in connection with the L3Harris Merger and recognized a pre-tax gain of $229 million.
Through fiscal 2019, the Harris Night Vision business was reported as part of our former Communication Systems segment. As a result of the then-pending divestiture, the Harris Night Vision business was not included in any of our new business segments and, consequently, the operating results of the business are included in “Other non-reportable business segments” for the quarters ended September 27, 2019 and September 28, 2018 in this Report.
Income before income taxes for the Harris Night Vision business was not material for the quarter ended September 27, 2019 and was $6 million for the quarter ended September 28, 2018. The carrying amounts of the major classes of assets and liabilities of the Harris Night Vision business classified as held for sale at June 28, 2019 are summarized below:
 
June 28, 2019
 
 
 
(In millions)
Receivables
$
18

Inventories
52

Property, plant and equipment
29

Goodwill
30

Other intangible assets
4

Assets of disposal group held for sale
$
133

 
 
Accounts payable
$
13

Contract liabilities
1

Compensation and benefits
3

Other accrued items
3

Defined benefit plans
16

Liabilities of disposal group held for sale
$
36


Stormscope. On August 30, 2019, we completed the sale of the Stormscope product line for $20 million in cash and recorded a pre-tax gain of $12 million in the “Engineering, selling and administrative expenses” line item of our Condensed Consolidated Statement of Income (Unaudited).
Note D — Stock Options and Other Share-Based Compensation
As of September 27, 2019, we had options or other share-based compensation outstanding under two Harris shareholder-approved employee stock incentive plans (“SIPs”), the Harris Corporation 2005 Equity Incentive Plan (As Amended and Restated Effective August 27, 2010) and the Harris Corporation 2015 Equity Incentive Plan (the “2015 EIP”), as well as under employee stock incentive plans of L3 assumed by L3Harris (collectively, “L3Harris SIPs”).
Harris equity awards granted prior to October 12, 2018, in accordance with the terms and conditions that were applicable to such awards prior to the L3Harris Merger, generally automatically vested upon closing of the L3Harris Merger and settled in L3Harris Common Stock, except stock options which automatically vested and remained outstanding. Harris equity awards granted on or after October 12, 2018 did not automatically vest upon closing of the L3Harris Merger, and instead remained outstanding as an award with respect to L3Harris Common Stock in accordance with the terms that were applicable to such award prior to the L3Harris Merger.
L3’s equity awards granted prior to October 12, 2018, in accordance with the terms and conditions that were applicable to such awards prior to the L3Harris Merger, generally automatically vested upon closing of the L3Harris Merger and settled in L3Harris Common Stock (except stock options automatically converted into stock options with respect to L3Harris Common Stock and remained outstanding), in each case, after giving effect to the Exchange Ratio and appropriate adjustments to reflect the consummation of the L3Harris Merger and the terms and conditions applicable to such awards prior to the L3Harris Merger. Any L3 restricted stock unit or L3 restricted stock award granted on or after October 12, 2018 was converted into a corresponding award with respect to L3Harris Common Stock, with the number of shares underlying such award adjusted based on the Exchange Ratio, and remained outstanding in accordance with the terms that were applicable to such award prior to the L3Harris Merger. Pursuant to the Merger Agreement, L3Harris assumed the converted L3 equity awards.
The compensation cost related to our share-based awards that was charged against income was $95 million, including acceleration expense recognized in connection with the L3Harris Merger, and $14 million for the quarters ended September 27, 2019 and September 28, 2018, respectively.

11


The aggregate number of shares of our common stock that we issued under the terms of L3Harris SIPs (including shares issued as merger consideration to settle pre-merger L3 share-based awards), net of shares withheld for tax purposes, was 2,837,153 and 403,953 for the quarters ended September 27, 2019 and September 28, 2018, respectively.
Awards granted to participants under L3Harris SIPs during the quarter ended September 27, 2019 consisted of 245,991 restricted stock units, 738,956 stock options and 55,020 performance stock units. The fair value as of the grant date of each stock option award was determined using the Black-Scholes-Merton option-pricing model and the following assumptions: expected dividend yield of 1.70 percent; expected volatility of 22.18 percent; risk-free interest rates averaging 1.68 percent; and expected term of 5.65 years.
The fair value as of the grant date of each restricted stock unit award and performance stock unit award was based on the closing price of our common stock on the grant date.
Note E — Restructuring and Other Exit Costs
We record charges for restructuring and other exit activities related to sales or terminations of product lines, closures or relocations of business activities, changes in management structure and fundamental reorganizations that affect the nature and focus of operations. Such charges include termination benefits, contract termination costs and costs to consolidate facilities or relocate employees. We record these charges at their fair value when incurred. In cases where employees are required to render service until they are terminated in order to receive the termination benefits and will be retained beyond the minimum retention period, we record the expense ratably over the future service period. These charges are included as a component of the “Engineering, selling and administrative expenses” line item in our Condensed Consolidated Statement of Income (Unaudited).
L3Harris Merger-Related Restructuring Costs
During the quarter ended September 27, 2019, we recorded $111 million of restructuring charges for workforce reductions (including severance and other employee-related exit costs) in connection with the L3Harris Merger. At September 27, 2019, we had recorded liabilities of $74 million associated with these restructuring actions, of which substantially all will be paid in the next twelve months. At this time, we are unable to reasonably estimate the total amount of cost expected to be incurred in connection with L3Harris Merger-related restructuring activities because we are still formulating plans for facility consolidations. We will disclose the total amount of cost expected to be incurred in connection with L3Harris Merger-related activities in future filings once the amount can be reasonably estimated.
Previous Restructuring and Other Exit Costs
Prior to the L3Harris Merger, we had liabilities of $16 million for lease obligations associated with exited facilities with remaining terms of four years or less, of which $13 million remained outstanding at September 27, 2019.
The following table summarizes our restructuring and other exit activities during the quarter ended September 27, 2019:
 
Employee severance-related costs
 
Facilities consolidation and other exit costs
 
Total
 
 
 
 
 
 
 
(In millions)
Balance at June 28, 2019
$

 
$
16

 
$
16

Additional provisions
111

 

 
111

Payments
(37
)
 
(3
)
 
(40
)
Balance at September 27, 2019
$
74

 
$
13

 
$
87



12


Note F — Accumulated Other Comprehensive Income (Loss) (“AOCI”)
The components of AOCI are summarized below:
 
Foreign currency translation(1)
 
Net unrealized (losses) gains on hedging derivatives(2)
 
Unrecognized postretirement obligations(3)
 
Total AOCI
 
 
 
 
 
 
 
 
 
(In millions)
Balance at June 28, 2019
$
(106
)
 
$
(38
)
 
$
(563
)
 
$
(707
)
Other comprehensive loss
(25
)
 
(38
)
 

 
(63
)
Amounts reclassified to earnings from AOCI

 
1

 
13

 
14

Balance at September 27, 2019
$
(131
)
 
$
(75
)
 
$
(550
)
 
$
(756
)
 
 
 
 
 
 
 
 
Balance at June 29, 2018
$
(99
)
 
$
(20
)
 
$
(83
)
 
$
(202
)
Other comprehensive income (loss)

 
1

 
(1
)
 

Amounts reclassified to earnings from AOCI

 

 

 

Balance at September 28, 2018
$
(99
)
 
$
(19
)
 
$
(84
)
 
$
(202
)

_______________
(1)
Net of income taxes of $2 million at September 27, 2019, June 28, 2019, September 28, 2018 and June 29, 2018.
(2)
Net of income taxes of $24 million, $13 million, $6 million and $7 million at September 27, 2019, June 28, 2019, September 28, 2018 and June 29, 2018, respectively.
(3)
Net of income taxes of $183 million and $188 million at September 27, 2019 and June 28, 2019, respectively, and net of income taxes of $30 million at September 28, 2018 and June 29, 2018.

Reclassifications from AOCI into earnings for the quarter ended September 27, 2019 are presented in the table below:
 
Amounts reclassified from AOCI
 
Affected line item in the Condensed Consolidated Statement of Income (Unaudited)
 
 
 
 
 
(In millions)
 
 
Loss on hedging instruments
$
1

 
Engineering, selling and administrative expenses
 
$
1

 
Income from continuing operations
 
 
 
 
Postretirement benefit obligations
$
13

 
Gain on sale of business
 
4

 
Non-operating income
 
(4
)
 
Income taxes
 
$
13

 
Income from continuing operations
 
 
 
 
Total reclassifications for the period
$
14

 
 

Note G — Receivables
Receivables are summarized below:
 
September 27, 2019
 
June 28, 2019
 
 
 
 
 
(In millions)
Accounts receivable
$
1,283

 
$
459

Less allowances for collection losses
(8
)
 
(2
)
 
$
1,275

 
$
457


We have a receivables sale agreement (“RSA”) with a third-party financial institution that permits us to sell, on a non-recourse basis, up to $100 million of outstanding receivables at any given time. From time to time, we have sold certain customer receivables under the RSA, which we continue to service and collect on behalf of the third-party financial institution and which we account for as sales of receivables with sale proceeds included in net cash from operating activities. Outstanding accounts receivable sold pursuant to the RSA were not material at September 27, 2019 and June 28, 2019.

13


Note H — Contract Assets and Contract Liabilities
Contract assets include unbilled amounts typically resulting from revenue recognized exceeding amounts billed to customers for contracts utilizing the percentage of completion (“POC”) cost-to-cost revenue recognition method. We bill customers as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, upon achievement of contractual milestones or upon deliveries and, in certain arrangements, the customer may withhold payment of a small portion of the contract price until contract completion. Contract liabilities include advance payments and billings in excess of revenue recognized, including deferred revenue associated with extended product warranties. Contract assets and liabilities are reported on a contract-by-contract basis at the end of each reporting period. The increase in contract assets and contract liabilities in the quarter ended September 27, 2019 was primarily due to contract assets and liabilities acquired in connection with the L3Harris Merger. Changes in contract assets and contract liabilities balances during the quarter ended September 27, 2019 were not materially impacted by any factors other than those described above.
Contract assets and contract liabilities are summarized below:
 
September 27, 2019
 
June 28, 2019
 
 
 
 
 
(In millions)
Contract assets
$
2,625

 
$
807

Contract liabilities, current
(1,210
)
 
(496
)
Contract liabilities, non-current(1)
(80
)
 
(42
)
Net contract assets
$
1,335

 
$
269

_______________
(1)
The non-current portion of contract liabilities is included as a component of the “Other long-term liabilities” line item in our Condensed Consolidated Balance Sheet (Unaudited).
The components of contract assets are summarized below: