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Summary of Significant Accounting Policies

Xylem Inc. (“Xylem” or the “Company”) is a leading equipment and service provider for water and wastewater applications with a broad portfolio of products and services addressing the full cycle of water, from collection, distribution and use to the return of water to the environment.

Xylem operates in three segments, Water Infrastructure, Applied Water and Measurement & Control Solutions. See Note 22, "Segment and Geographic Data" for further segment background information.

On October 31, 2011 (the "Distribution Date"), ITT Corporation (“ITT”) completed the Spin-off (the “Spin-off”) of Xylem, formerly ITT’s water equipment and services businesses. The Spin-off was completed pursuant to the Distribution Agreement, dated as of October 25, 2011 (the “Distribution Agreement”), among ITT (now ITT LLC), Exelis Inc., acquired by Harris Inc. on May 29, 2015, (“Exelis”) and Xylem. Xylem Inc. was incorporated in Indiana on May 4, 2011 in connection with the Spin-off.

Hereinafter, except as otherwise indicated or unless the context otherwise requires, “Xylem,” “we,” “us,” “our” and “the Company” refer to Xylem Inc. and its subsidiaries. References in the notes to the consolidated financial statements to “ITT” or “ former parent” refers to ITT Corporation (now ITT LLC) and its consolidated subsidiaries (other than Xylem Inc.).

Basis of Presentation

The consolidated financial statements reflect our financial position and results of operations in conformity with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany transactions between our businesses have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Estimates are revised as additional information becomes available. Estimates and assumptions are used for, but not limited to, postretirement obligations and assets, revenue recognition, income tax contingency accruals and valuation allowances, valuation of intangible assets, goodwill and indefinite lived intangible impairment testing and contingent liabilities. Actual results could differ from these estimates.

Consolidation Principles

We consolidate companies in which we have a controlling financial interest or when Xylem is considered the primary beneficiary of a variable interest entity. We account for investments in companies over which we have the ability to exercise significant influence but do not hold a controlling financial interest under the equity method, and we record our proportionate share of income or losses in the Consolidated Income Statements. Equity method investments are reviewed for impairment when events or circumstances indicate the investment may be other than temporarily impaired. This requires significant judgment, including an assessment of the investee’s financial condition, the possibility of subsequent rounds of financing, and the investee’s historical and projected results of operations. If the actual results of operations for the investee are significantly different from projections, we may incur future charges for the impairment of these investments.

Foreign Currency Translation

The national currencies of our foreign companies are generally the functional currencies. Balance sheet accounts are translated at the exchange rate in effect at the end of each period; income statement accounts are translated at the average rates of exchange prevailing during the period. Gains and losses on foreign currency translations are reflected in the cumulative translation adjustments component of stockholders’ equity. Net gains or losses from foreign currency transactions are reported currently in selling, general and administrative expenses.

Revenue Recognition

Xylem adopted the new guidance on recognizing revenue from contracts with customers as of January 1, 2018. In accordance with this new guidance Xylem recognizes revenue in a manner that depicts the transfer of promised goods and services to customers in an amount that reflects the consideration to which it expects to be entitled to for

providing those goods and services. For each arrangement with a customer, we identify the contract, the associated performance obligations within the contract, determine the transaction price of that contract, allocate the transaction price to each performance obligation and recognize revenue as each performance obligation is satisfied.

The satisfaction of performance obligations in a contract is based upon when the customer obtains control over the asset. Depending on the nature of the performance obligation, control transfers either at a particular point in time, or over time which determines the recognition pattern of revenue.

For product sales, other than long-term construction-type contracts, we recognize revenue once control has passed at a point in time, which is generally when products are shipped. In instances where contractual terms include a provision for customer acceptance, revenue is recognized when either (i) we have previously demonstrated that the product meets the specified criteria based on either seller or customer specified objective criteria or (ii) upon formal acceptance received from the customer where the product has not been previously demonstrated to meet customer specified objective criteria. We recognize revenue on product sales to channel partners, including resellers, distributors or value-added solution providers at the point in time when control is transferred which is determined based on when the risks and rewards, possession, and title have transferred to the customer, which usually occurs at the point of delivery.

Revenue from performance obligations related to services is recognized over time, as the performance obligations are satisfied. In these instances, the customer consumes the benefit of the service as Xylem performs.

Certain businesses also enter into long-term construction-type sales contracts where revenue is recognized over time. In these instances, revenue is recognized using a measure of progress that applies an input method based on costs incurred in relation to total estimated costs. We also recognize revenue for certain of these arrangements using the output method and measure progress based on shipments of product where control has transferred to the customer.

If shipping and handling activities are performed after a customer obtains control of a good, we account for the shipping and handling activities as activities to fulfill a promise to transfer a good. Shipping and handling related costs are accrued as revenue is recognized.

For all contracts with customers, we determine the transaction price in the arrangement and allocate the transaction price to each performance obligation identified in the contract. Judgment is required to determine the appropriate unit of account, and we separate out the performance obligations if they are capable of being distinct and if they are distinct within the context of the contract. We base our allocation of the transaction price to the performance obligations on the relative standalone selling prices for the goods or services contained in a particular performance obligation. The standalone selling prices are determined first by reference to observable prices. In the event observable prices are not available, we estimate the stand-alone selling price by maximizing observable inputs and applying an adjusted market assessment approach, expected cost plus margin approach, or a residual approach in limited situations. Revenue in these instances is recognized on individual performance obligations within the same contract as they are satisfied.

The transaction price is adjusted for our estimate of variable consideration which may include a right of return, discounts, rebates, penalties and retainage. To estimate variable consideration, we apply the expected value or the most likely amount method, based on whichever method most appropriately predicts the amount of consideration we expect to receive. The method applied is typically based on historical experience and known trends. We constrain the amounts of variable consideration that are included in the transaction price, to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur or when uncertainties around the variable consideration are resolved.

We exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with specific revenue-producing transaction and collected from a customer, for example sales, use, value added and some excise taxes.

For all contracts with customers, payment received for our products and services may not necessarily follow the same pattern of revenue recognition to which it relates and are dictated by the terms and conditions of our contracts with customers. Payments received for product sales typically occur following delivery and the satisfaction of the performance obligation based upon the terms outlined in the contracts. Payments received for services typically occur following the services being rendered. For long-term construction-type projects, payments are typically made throughout the contract as progress is made.

In limited situations, contracts with customers include financing components where payment terms exceed one year, however, we believe that the financing effects are not significant to Xylem. In addition, we apply a practical

expedient and do not adjust the promised amount of consideration in a contract for the effects of significant financing components when we expect payment terms to be one year or less from the time the goods or services are transferred until ultimate payment.

We offer standard warranties for our products to ensure that our products comply with agreed-upon specifications in our contracts. Standard warranties do not give rise to performance obligations and represent assurance-type warranties. In certain instances, product warranty terms are adjusted to account for the specific nature of the contract. In these instances, we assess the warranties to determine whether they represent service-type warranties, and should be accounted for as a separate performance obligation in the contract.

Costs to obtain a contract include incremental costs that the Company has incurred which it expects to recover. Incremental costs only include costs that the Company would not have incurred had the contract not been obtained. Costs that would have been incurred regardless of whether or not the contract was obtained are expensed as incurred, unless they are explicitly chargeable to the customer whether or not the contract is obtained.

Costs to obtain contracts are capitalized when incurred. The costs to obtain contracts are then amortized in a manner that is consistent with the pattern of transfer of the related goods or services provided in the contract. The Company elects to apply the practical expedient to expense costs to obtain contracts when the associated amortization period of those costs would be one year or less.

For annual periods prior to January 1, 2018, revenue is recognized when persuasive evidence of an arrangement exists, the price is fixed or determinable, collectability is reasonably assured and delivery has occurred or services have been rendered. For product sales, other than long-term construction-type contracts, we recognize revenue at the time title, and risks and rewards of ownership pass, which is generally when products are shipped. Certain contracts with customers require delivery, installation, testing, certification or other acceptance provisions to be satisfied before revenue is recognized. We recognize revenue on product sales to channel partners, including resellers, distributors or value-added solution providers at the time of sale when the channel partners have economic substance apart from Xylem and Xylem has completed its obligations related to the sale. Revenue from the rental of equipment is recognized over the rental period. Service revenue is recognized as services are performed.

For agreements that contain multiple deliverables, we recognize revenue based on the relative selling price if the deliverable has stand-alone value to the customer and, in arrangements that include a general right of return relative to the delivered element, performance of the undelivered element is considered probable and substantially in the Company’s control. The selling price for a deliverable is based on vendor-specific objective evidence of selling price (“VSOE”), if available, third-party evidence of selling price (“TPE”) if VSOE is not available, or best estimated selling price, if neither VSOE nor TPE is available.

The deliverables in our arrangements with multiple elements include various products and may include related services, such as installation and start-up services. Generally, these elements are satisfied within the same reporting period although certain contracts may be completed over 6 months. We allocate arrangement consideration based on the relative selling prices of the separate units of accounting determined in accordance with the hierarchy described above. For deliverables that are sold separately, we establish VSOE based on the price when the deliverable is sold separately. We establish TPE, generally for services, based on prices similarly situated customers pay for similar services from third-party vendors. For those deliverables for which we are unable to establish VSOE or TPE, we estimate the selling price considering various factors including market and pricing trends, geography, product customization, and profit objectives. Revenue for multiple element arrangements is recognized when the appropriate revenue recognition criteria for the individual deliverable have been satisfied.

Certain businesses enter into long-term construction-type sales contracts for which revenue is recognized under the percentage-of-completion method based upon percentage of costs incurred to total estimated costs.

Shipping and Handling Costs

Shipping and handling costs are recorded as a component of cost of revenue.

Share-Based Compensation

Share-based awards issued to employees and members of the Board of Directors include non-qualified stock options, restricted stock unit awards and performance share unit awards. Compensation costs resulting from share-based payment transactions are recognized primarily within selling, general and administrative expenses, at fair value over the requisite service period (typically three years) on a straight-line basis. The calculated compensation cost is adjusted based on an estimate of awards ultimately expected to vest. For performance awards, the calculated compensation cost is adjusted based on an estimate of awards ultimately expected to vest and our

assessment of the probable outcome of the performance condition. The fair value of a non-qualified stock option is determined on the date of grant using a binomial lattice pricing model incorporating multiple and variable assumptions over time, including assumptions such as employee exercise patterns, stock price volatility and changes in dividends. The fair value of restricted stock unit awards is determined using the closing price of our common stock on date of grant. The fair value of Return on Invested Capital ("ROIC") performance share units at 100% target is determined using the closing price of our common stock on date of grant. The fair value of Total Shareholder Return ("TSR") performance share units is calculated on the date of grant using a Monte Carlo simulation model utilizing several key assumptions, including expected Company and peer company share price volatility, correlation coefficients between peers, the risk-free rate of return, the expected dividend yield and other award design features.

Research and Development

We conduct research and development activities, which consist primarily of the development of new products, product applications, and manufacturing processes. To the extent these activities are related to developing software that is sold to our customers, we capitalize the applicable development costs. All other research and development costs are charged to expense as incurred.

Exit and Disposal Costs

We periodically initiate management-approved restructuring activities to achieve cost savings through reduced operational redundancies and to position ourselves strategically in the market in response to prevailing economic conditions and associated customer demand. Costs associated with restructuring actions can include severance, infrastructure charges to vacate facilities or consolidate operations, contract termination costs and other related charges. For involuntary separation plans, a liability is recognized when it is probable and reasonably estimable. For voluntary separation plans, a liability is recognized when the employee irrevocably accepts the voluntary termination. For one-time termination benefits, such as additional severance pay or benefit payouts, and other exit costs, such as lease termination costs, the liability is measured and recognized initially at fair value in the period in which the liability is incurred, with subsequent changes to the liability recognized as adjustments in the period of change.

Deferred Financing Costs

Deferred financing costs represent costs incurred in conjunction with our debt financing activities and are capitalized in long-term debt and amortized over the life of the related financing arrangements. If the debt is retired early, the related unamortized deferred financing costs are written off in the period the debt is retired and are recorded in the results of operations under the caption “interest expense.”

Income Taxes

Income taxes are calculated using the asset and liability method. Deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax bases of assets and liabilities, applying enacted tax rates in effect for the year in which we expect the differences will reverse.

We maintain valuation allowances when it is more likely than not that all or a portion of a deferred asset will not be realized. The valuation allowance is intended in part to provide for the uncertainty regarding the ultimate utilization of our U.S. capital loss carryforwards, U.S. foreign tax credit carryovers, and foreign net operating loss carryforwards. In determining whether a valuation allowance is warranted, we consider all positive and negative evidence and all sources of taxable income such as prior earnings history, expected future earnings, carryback and carryforward periods and tax strategies to estimate if sufficient future taxable income will be generated to realize the deferred tax asset. The assessment of the adequacy of our valuation allowance is based on our estimates of taxable income by jurisdiction in which we operate and the period over which our deferred tax assets will be recoverable. In the event that actual results differ from these estimates, or we adjust these estimates in future periods for current trends or expected changes in our estimating assumptions, we may need to modify the level of valuation allowance that could materially impact our business, financial condition and results of operations.

Due to the U.S. Tax Cuts and Jobs Act (the "Tax Act"), we have recorded net foreign withholding taxes and state income taxes on earnings that are expected to be repatriated to the U.S. parent. We have not recorded any deferred taxes on the amounts that the Company currently does not intend to repatriate as the determination of any deferred taxes on this amount is not reasonably estimable.

Tax benefits are recognized for an uncertain tax position when, in management’s judgment, it is more likely than not that the position will be sustained upon examination by a taxing authority. For a tax position that meets the more-likely-than-not recognition threshold, the tax benefit is measured as the largest amount that is judged to have a

greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority. The liability associated with unrecognized tax benefits is adjusted periodically due to changing circumstances and when new information becomes available. Such adjustments are recognized in the period in which they are identified. The effective tax rate includes the net impact of changes in the liability for unrecognized tax benefits and subsequent adjustments as considered appropriate by management. While it is often difficult to predict the final outcome or the timing of resolution of any particular tax matter, we believe our liability for unrecognized tax benefits is adequate. We classify interest relating to unrecognized tax benefits as a component of other non-operating (expense) income, net and tax penalties as a component of income tax expense in our Consolidated Income Statements.

Earnings Per Share

We present two calculations of earnings per share (“EPS”). “Basic” EPS equals net income divided by weighted average shares outstanding during the period. “Diluted” EPS equals net income divided by the sum of weighted average common shares outstanding during the period plus potentially dilutive shares. Potentially dilutive common shares that are anti-dilutive are excluded from diluted EPS.

Cash Equivalents

We consider all liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Receivables and Allowance for Doubtful Accounts and Discounts

Receivables primarily comprise uncollected amounts owed to us from transactions with customers and are presented net of allowances for doubtful accounts, returns and early payment discounts.

We determine our allowance for doubtful accounts using a combination of factors to reduce our trade receivable balances to their estimated net realizable amount. We maintain an allowance for doubtful accounts based on a variety of factors, including the length of time receivables are past due, macroeconomic trends and conditions, significant one-time events, historical experience and the financial condition of customers. In addition, we record a specific reserve for individual accounts when we become aware of specific customer circumstances, such as in the case of bankruptcy filings or deterioration in the customer’s operating results or financial position. The past due or delinquency status of a receivable is based on the contractual payment terms of the receivable. If circumstances related to the specific customer change, we adjust estimates of the recoverability of receivables as appropriate. We determine our allowance for early payment discounts primarily based on historical experience with customers.

Credit risk with respect to accounts receivable is generally diversified due to the large number of entities comprising our customer base and their dispersion across many different geographical regions. We perform ongoing credit evaluations of the financial condition of our third-party distributors, resellers and other customers and require collateral, such as letters of credit and bank guarantees, in certain circumstances. As of December 31, 2019 and 2018 we do not believe we have any significant concentrations of credit risk.

Inventories

Inventories, which include the costs of material, labor and overhead, are stated at the lower of cost or net realizable value. Estimated losses from obsolete and slow-moving inventories are recorded to reduce inventory values to their estimated net realizable value. Our manufacturing operations recognize costs of sales using standard costs with full overhead absorption, which generally approximates actual cost.

Property, Plant and Equipment

These assets are recorded at historical cost and are depreciated using the straight-line method of depreciation over the estimated useful lives as follows:



	Estimated Life
Buildings and improvements	5 to 40 years
Machinery and equipment	2 to 10 years
Furniture and fixtures	3 to 7 years
Equipment held for lease or rental	2 to 10 years

Leasehold improvements are depreciated over the shorter of their estimated useful life or the term of the lease. Costs related to maintenance and repairs that do not prolong the assets' useful lives are expensed as incurred.

Leases

Xylem adopted ASC 842 - Leases as of January 1, 2019. We determine if an arrangement is a lease at inception. We have recorded right of use (“ROU”) assets and liabilities for lease arrangements that are reasonably certain to extend beyond 12 months. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments under the lease. ROU assets and liabilities are recognized at lease commencement date based on the present value of lease payments over the lease term. The implicit rate within our leases is generally not determinable, and we use our incremental borrowing rate at the lease commencement date to determine the net present value of lease payments. The determination of the appropriate incremental borrowing rate requires judgment. We determine the appropriate incremental borrowing rate for each lease using our current borrowing rate, adjusted for various factors including geographic region, level of collateralization and term, to align with the term of the underlying lease.

Lease expense for lease payments is recognized on a straight-line basis over the lease term. Many of our leases are subject to payment adjustments to reflect annual changes in price indexes, such as the Consumer Price Index. While associated lease liabilities are not re-measured as a result of changes in the applicable price indexes, changes to required lease payments are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred.

Leases with a lease term of 12 months or less, including renewal options that are reasonably certain to be exercised, that also do not include an option to purchase the underlying asset that is reasonably certain of exercise, are not recorded on the balance sheet. Instead, lease payments for these leases are recognized as a lease cost on a straight-line basis over the lease term.

We elected the package of practical expedients, which among other things, does not require reassessment of lease classification. Additionally, we have made an accounting policy election whereby we chose not to separate non-lease components from lease components in agreements in all leases which we are the lessee.

For annual periods prior to January 1, 2019 lease assets and liabilities are generally not recorded on the balance sheet. Instead, lease payments for these leases are recognized as a lease cost on a straight-line basis over the lease term.

Goodwill and Intangible Assets

Goodwill represents purchase consideration paid in a business combination that exceeds the values assigned to the net assets of acquired businesses. Intangible assets include customer relationships, proprietary technology, brands and trademarks, patents, software and other intangible assets. Intangible assets with a finite life are amortized on a straight-line basis over an estimated economic useful life which ranges from 1 to 25 years and is included in cost of revenue or selling, general and administrative expense. Certain of our intangible assets, namely certain brands and trademarks, as well as Federal Communications Commission ("FCC") licenses, have an indefinite life and are not amortized.

Long-Lived Asset Impairment

Long-lived assets, including intangible assets with finite lives, are amortized and tested for impairment whenever events or changes in circumstances indicate their carrying value may not be recoverable. We assess the recoverability of long-lived assets based on the undiscounted future cash flow the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When an impairment is identified, we reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values.

Goodwill and indefinite-lived intangible assets are not amortized, but rather are tested for impairment annually (or more frequently if impairment indicators arise, such as changes to the reporting unit structure, significant adverse changes in the business climate or an adverse action or assessment by a regulator). We conduct our annual impairment testing on the first day of our fourth quarter. For goodwill, the estimated fair value of each reporting unit is compared to the carrying value of the net assets assigned to that reporting unit. If the estimated fair value of the reporting unit exceeds its carrying value, goodwill is not impaired. If the carrying value of the reporting unit exceeds its estimated fair value, then an impairment charge is recognized for that excess up to the amount of recorded goodwill. We estimate the fair value of our reporting units using an income approach. We estimate the fair value of our intangible assets with indefinite lives using either the income approach or the market approach. Under the income approach, we calculate fair value based on the present value of estimated future cash flows. Under the market approach, we calculate fair value based on recent sales and selling prices of similar assets.

Product Warranties

For assurance-type warranties, we accrue for the estimated cost of product warranties at the time revenue is recognized and record it as a component of cost of revenue. Our product warranty liability reflects our best estimate of probable liability under the terms and conditions of our product warranties offered to customers. We estimate the liability based on our standard warranty terms, the historical frequency of claims and the cost to replace or repair our products under warranty. Factors that impact our warranty liability include the number of units sold, the length of warranty term, historical and anticipated rates of warranty claims and cost per claim. We also record a warranty liability for specific matters. We assess the adequacy of our recorded warranty liabilities quarterly and adjust amounts as necessary.

For service-type warranties (i.e. non-standard warranties) costs incurred to fulfill the extended or service warranty are recognized/recorded as the costs are incurred.

Postretirement Benefit Plans

The determination of defined benefit pension and postretirement plan obligations and their associated costs requires the use of actuarial computations to estimate participant plan benefits to which the employees will be entitled. The significant assumptions primarily relate to discount rates, expected long-term rates of return on plan assets, rate of future compensation increases, mortality, years of service and other factors. We develop each assumption using relevant company experience in conjunction with market-related data for each individual country in which such plans exist. All actuarial assumptions are reviewed annually with third-party consultants and adjusted as necessary. For the recognition of net periodic postretirement cost, the calculation of the expected return on plan assets is generally derived by applying the expected long-term rate of return on the market-related value of plan assets. The market-related value of plan assets is based on average asset values at the measurement date over the last five years. Actual results that differ from our assumptions are accumulated and amortized on a straight-line basis only to the extent they exceed 10% of the higher of the market-related value or the projected benefit obligation, over the average remaining service period of active participants, or for plans with all or substantially all inactive participants, over the average remaining life expectancy. The fair value of plan assets is determined based on market prices or estimated fair value at the measurement date.

We consider changes to a plan’s benefit formula that eliminate the accrual for future service but continue to allow for future salary increases (i.e. “soft freeze”) to be a curtailment.

Business Combinations

We allocate the purchase price of acquisitions to the tangible and intangible assets acquired, liabilities assumed, and non-controlling interests in the acquiree based on their estimated fair value at the acquisition date. The excess of the acquisition price over those estimated fair values is recorded as goodwill. Changes to the acquisition date provisional fair values prior to the expiration of the measurement period, a period not to exceed 12 months from date of acquisition, are recorded as an adjustment to the associated goodwill. Acquisition-related expenses and restructuring costs, if any, are recognized separately from the business combination and are expensed as incurred.

Derivative Financial Instruments

We record all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on whether we have elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, including forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. We may enter into derivative contracts that are intended to hedge certain risks economically, even though hedge accounting does not apply or we elect not to apply hedge accounting.

During the fourth quarter of 2018 we adopted new accounting guidance that eliminates the concept of ineffectiveness for cash flow and net investment hedges. Prior to this adoption, the effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges of foreign exchange risk was recorded in other comprehensive income ("OCI") and was subsequently reclassified into either revenue or cost of revenue (hedge of sales classified into revenue and hedge of purchases classified into cost of revenue) in the period that the

hedged forecasted transaction affects earnings. Any ineffective portion of the change in fair value of the derivative was recognized directly in selling, general and administrative expenses. Our policy was to de-designate cash flow hedges at the time forecasted transactions are recognized as assets or liabilities on a business unit’s balance sheet and report subsequent changes in fair value through selling, general and administrative expenses where the gain or loss due to movements in currency rates on the underlying asset or liability is revalued. If it became probable that the originally forecasted transaction would not occur, the gain or loss related to the hedge recorded within accumulated other comprehensive income ("AOCI") was immediately recognized into net income.

Prior to the adoption of the new guidance, changes in the fair value of derivatives designated and that qualify as net investment hedges of foreign exchange risk were recorded in OCI. Amounts in AOCI were reclassified into earnings at the time the hedged net investment is sold or substantially liquidated. Effectiveness of derivatives designated as net investment hedges was assessed using the forward method.

Subsequent to adopting the new hedge guidance, changes in the fair value of derivatives designated and that qualify as cash flow hedges of foreign exchange risk are recorded in other comprehensive income ("OCI") and are subsequently reclassified into either revenue or cost of revenue (hedge of sales classified into revenue and hedge of purchases classified into cost of revenue) in the period that the hedged forecasted transaction affects earnings. Our policy is to de-designate cash flow hedges at the time forecasted transactions are recognized as assets or liabilities on a business unit’s balance sheet and report subsequent changes in fair value through selling, general and administrative expenses where the gain or loss due to movements in currency rates on the underlying asset or liability is revalued. If it becomes probable that the originally forecasted transaction will not occur, the gain or loss related to the hedge recorded within accumulated other comprehensive income ("AOCI") is immediately recognized into net income.

Subsequent to adopting the new hedge guidance effectiveness of derivatives designated as net investment hedges is assessed using the spot method. The changes in the fair value of these derivatives due to movements in spot exchange rates are recorded in OCI. Amounts in AOCI are reclassified into earnings at the time the hedged net investment is sold or substantially liquidated. Furthermore, we recognize interest income based on the interest rate differential embedded in the derivative instrument.

Commitments and Contingencies

We record accruals for commitments and loss contingencies for those which are both probable and for which the amount can be reasonably estimated. In addition, legal fees are accrued for cases where a loss is probable and the related fees can be reasonably estimated. Significant judgment is required to determine both probability and the estimated amount of loss. We review these accruals quarterly and adjust the accruals to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other current information.

Accruals for environmental matters are recorded on a site-by-site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies. Our estimated liability is reduced to reflect the anticipated participation of other potentially responsible parties in those instances where it is probable that such parties are legally responsible and financially capable of paying their respective shares of the relevant costs. These accruals are reviewed quarterly and are adjusted as assessment and remediation efforts progress or as additional technical or legal information becomes available. Actual costs to be incurred at identified sites in future periods may vary from the estimates, given inherent uncertainties in evaluating environmental exposures. Accruals for environmental liabilities are primarily included in other non-current liabilities at undiscounted amounts and exclude claims for recoveries from insurance companies or other third parties.

Concentrations of Credit Risk

Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, and accounts receivable from trade customers. We maintain cash and cash equivalents and derivative contracts with various financial institutions. These financial institutions are located in many different geographical regions, and our policy is designed to limit exposure with any one institution. As part of our cash and risk management processes, we perform periodic evaluations of the relative credit standing of the financial institutions. We have not sustained any material credit losses during the previous three years from instruments held at financial institutions. We may utilize forward contracts to protect against the effects of foreign currency fluctuations. Such contracts involve the risk of non-performance by the counterparty. Credit risk with respect to accounts receivable is generally diversified due to the large number of entities comprising our customer base and their dispersion across many different industries and geographic regions. We perform ongoing credit evaluations of the financial condition of our third-party distributors, resellers and other customers and require collateral, such as letters of credit and bank guarantees, in certain circumstances.

Substantially all of the cash and cash equivalents, including foreign cash balances, at December 31, 2019 and 2018 were uninsured. Foreign cash balances at December 31, 2019 and 2018 were $510 million and $274 million, respectively.

Fair Value Measurements

We determine fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We use a hierarchical structure to prioritize the inputs to valuation techniques used to measure fair value into three broad levels defined as follows:


•	Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

•

Level 2 inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices (in non-active markets or in active markets for similar assets or liabilities), inputs other than quoted prices that are observable, and inputs that are derived principally from or corroborated by observable market data by correlation or other means.


•	Level 3 inputs are unobservable inputs for the assets or liabilities.

The fair value hierarchy is based on maximizing the use of observable inputs and minimizing the use of unobservable inputs when measuring fair value. Classification within the fair value hierarchy is based on the lowest level input that is significant to the fair value measurement.

NAV Practical Expedient is the measurement of fair value using the net asset value ("NAV") per share (or its equivalent) as an alternative to the fair value hierarchy as discussed above.

Recently Issued Accounting Pronouncements

12 Months Ended

Dec. 31, 2019

Recently Issued Accounting Pronouncements

Pronouncements Not Yet Adopted

In June 2016, the FASB issued guidance amending the accounting for the impairment of financial instruments, including trade receivables. Under current guidance, credit losses are recognized when the applicable losses have a probable likelihood of occurring and this assessment is based on past events and current conditions. The amended guidance eliminates the “probable” threshold and requires an entity to use a broader range of information, including forecast information when estimating expected credit losses. Generally, this should result in a more timely recognition of credit losses. This guidance is effective for interim and annual periods beginning after December 15, 2019 with early adoption permitted for interim and annual periods beginning after December 15, 2018. The requirements of the amended guidance should be applied using a modified retrospective approach except for debt securities, which require a prospective transition approach. The guidance will not have a material impact on our financial condition and results of operations.

Recently Adopted Pronouncements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued guidance regarding the accounting for implementation costs of a hosting arrangement that is a service contract. The guidance establishes the requirement to capitalize certain implementation costs incurred in a hosting arrangement that is a service contract, effectively aligning with the requirement to capitalize certain implementation costs incurred to develop or obtain internal-use software. This guidance is effective for interim and annual periods beginning after December 15, 2019 with early adoption permitted. The requirements of the amended guidance may be applied using either a retrospective or prospective approach. We adopted this guidance prospectively as of April 1, 2019. This guidance did not have a material impact on our financial condition and results of operations.

In February 2016, the FASB issued guidance amending the accounting for leases. Specifically, the amended guidance requires all lessees to record a lease liability at lease inception, with a corresponding right of use ("ROU") asset, except for short-term leases. Lessor accounting is not fundamentally changed. This amended guidance is effective for interim and annual periods beginning after December 15, 2018 using a modified retrospective approach. Early adoption was permitted. We adopted this guidance as of January 1, 2019 using the modified retrospective approach whereby prior comparative periods were not retrospectively restated in the consolidated financial statements. The adoption of the standard resulted in the recognition of ROU assets and lease liabilities of $267 million and $265 million, respectively, as well as deferred tax assets and deferred tax liabilities of $68 million, as of January 1, 2019, the date of initial application. The guidance did not have a material impact on our consolidated Income Statements and Statements of Cash Flow. See Note 11, "Leases" for further details.

In August 2017, the FASB issued amended guidance on hedging activities. The amendment better aligns a company’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying for hedging relationships and the presentation of hedge results. Specifically, the guidance:


(1)	Eliminates the concept of recognizing periodic hedge ineffectiveness for cash flow and net investment hedges;


(2)	Eliminates the benchmark interest rate concept of variable - rate instruments in cash flow hedges and allows companies to designate the contractually specified interest rate as the hedged risk;


(3)	Requires a company to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported; and


(4)	Provides the ability to perform subsequent hedge effectiveness tests qualitatively.

This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted with the effect of adoption reflected as of the beginning of the fiscal year of adoption. For cash flow and net investment hedges existing at the date of adoption, a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness is required. Other presentation and disclosure guidance is required only prospectively. We adopted this guidance in the fourth quarter of 2018. The adoption resulted in the recognition of $2 million of interest income as a result of our transition from the forward rate method to the spot rate method in accounting for our net investment hedges.

In February 2018, the FASB issued new guidance on the reclassification of certain tax effects in Accumulated Other Comprehensive Income ("AOCI"). The guidance allows a reclassification from AOCI to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act (the “Tax Act”). This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted. The guidance may be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. We early adopted this guidance effective the first quarter of 2018, and elected to reclassify the income tax effects of the Tax Act from AOCI to retained earnings. As a result of adopting the guidance, AOCI was reduced by $17 million and retained earnings increased by $17 million. This amount includes the effect of the change in the US federal corporate income tax rate.

In March 2017, the FASB issued amended guidance on the presentation of net periodic benefit costs. The amendment requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components are required to be presented in the income statement separately and outside a subtotal of income from operations, if one is presented. The amendment also requires entities to disclose the income statement lines that contain the other components if they are not appropriately described. This guidance is effective retrospectively for periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted. We adopted this guidance effective the first quarter of 2018. The prior period consolidated income statements and segment results have been retrospectively adjusted in accordance with the new guidance. The impact to the presentation between operating income and other non-operating income within Xylem's Consolidated Income Statements was approximately $4 million for the year ended December 31, 2017.

In May 2014, the FASB issued guidance on recognizing revenue from contracts with customers. The guidance outlines a single comprehensive model to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the model is that an entity recognizes revenue to portray the transfer of goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also expands disclosure requirements regarding revenue recognition. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017 and may be applied retrospectively to each prior period presented or using a modified retrospective approach with the cumulative effect recognized as of the date of initial application. Early adoption is permitted for interim and annual reporting periods beginning after December 15, 2016. We adopted this guidance as of January 1, 2018 using the modified retrospective transition method. The adoption of the guidance did not have a material impact on our financial condition and results of operations. See Note 4, "Revenue", for further details.

Acquisitions and Divestitures

12 Months Ended

Dec. 31, 2019

Business Combinations [Abstract]

Acquisitions and Divestitures

2019 Acquisitions

During the twelve months ended December 31, 2019 we spent approximately $18 million, net of cash received on acquisition activity.

2018 Acquisitions and Divestitures

Pure Technologies Ltd.

On January 31, 2018, we acquired all the issued and outstanding shares of Pure Technologies Ltd. (“Pure”), a leader in intelligent leak detection and condition assessment solutions for water distribution networks for approximately $420 million, net of cash received. Acquisition costs of $4 million were reflected as a component of selling, general and administrative expenses in our Consolidated Income Statement for the year ended December 31, 2018.

Pure’s results of operations were consolidated with the Company effective February 1, 2018 and are reflected in the Measurement & Control Solutions segment.

The Pure purchase price allocation as of January 31, 2018 is shown in the following table:



(in millions)	Amount
Cash	$	14
Receivables	23
Inventories	4
Prepaid and other current assets	2
Property, plant and equipment	22
Intangible assets	149
Other long-term assets	1
Accounts payable	(3		)
Accrued and other current liabilities	(12		)
Deferred income tax liabilities	(25		)
Other non-current accrued liabilities	(2		)
Total identifiable net assets	173

Goodwill	261
Total consideration	$	434

The fair values of Pure's assets and liabilities were determined based on estimates and assumptions which management believes are reasonable.

Goodwill arising from the acquisition consists largely of synergies and economies of scale expected from combining the operations of Pure and Xylem. All of the goodwill was assigned to the Measurement & Control Solutions segment and is not deductible for tax purposes.

The estimate of the fair value of Pure identifiable intangible assets was determined primarily using the “income approach,” which requires a forecast of all of the expected future cash flows either through the use of the multi-period excess earnings method or the relief-from-royalty method. Some of the more significant assumptions inherent in the development of intangible asset values include: the amount and timing of projected future cash flows, the discount rate selected to measure the risks inherent in the future cash flows, the assessment of the intangible asset’s life cycle, as well as other factors.

The following table summarizes key information underlying identifiable intangible assets related to the Pure acquisition:



Category	Life	Amount (in millions)
Customer Relationships	17 - 18 years	$	84
Technology	3 - 10 years	38
Tradenames	20 years	21
Internally Developed Software	3 years	6
Total		$	149

The following table summarizes, on an unaudited pro forma basis, the condensed combined results of operations of the Company for the years ended December 31, 2018 and 2017, respectively, assuming the acquisition of Pure was made on January 1, 2017:



(in millions)	Year Ended December 31,
	2018	2017
Revenue	$5,212	$4,809
Net income	$546	$323

The foregoing unaudited pro forma results are for informational purposes only and are not necessarily indicative of the actual results of operations that might have occurred had the acquisition occurred on January 1, 2017, nor are they necessarily indicative of future results. The pro forma financial information includes the impact of purchase accounting and other nonrecurring items directly attributable to the acquisition, which include:


•	Amortization expense of acquired intangibles


•	Adjustments to the depreciation of property, plant and equipment reflecting the impact of the calculated fair value of those assets in accordance with purchase accounting


•	Adjustments to interest expense to remove historical Pure interest costs and reflect Xylem's current debt profile


•	The related tax impact of the above referenced adjustments

The pro forma results do not include any cost savings or operational synergies that may be generated or realized due to the acquisition of Pure.

During the eleven month period ended December 31, 2018 Pure had revenue and an operating loss of $96 million and $2 million, respectively.

Other Acquisition Activity

During the twelve months ended December 31, 2018 we spent approximately $13 million, net of cash received on other acquisition activity.

Divestiture

During the third quarter we divested our Precision Die Casting business for approximately $22 million, net of cash assumed. The sale resulted in an immaterial gain, which is reflected in gain from sale of business in our Consolidated Income Statement. The business, which was part of our Measurement & Controls Solutions segment, provided aluminum die casting products primarily to customers in the automotive sector. The business reported 2017 annual revenue of approximately $32 million.

2017 Acquisitions and Divestitures

Acquisition Activity

During 2017 we spent approximately $33 million on acquisition activity, including the acquisition of EmNet LLC (“EmNet”), a developer of software and data analytics solutions for municipalities.

Divestitures

On October 31, 2017, we divested our Flowtronex and Water Equipment Technologies (WET) businesses for $6 million. The sale resulted in a gain of approximately $1 million, which is reflected in gain from sale of business in our Consolidated Income Statement. The business, which was part of our Applied Water segment, provided turf and reverse osmosis packages to customers in the agricultural and industrial sectors. The business reported approximately $9 million of revenue in the first 10 months of 2017.

On February 17, 2017, we divested our United Kingdom and Poland based membranes business for approximately $10 million. The sale resulted in a gain of $5 million, which is reflected in gain from sale of business in our Consolidated Income Statement. The business, which was part of our Applied Water segment, provided membrane filtration products primarily to customers in the municipal water and industrial sectors. The business reported 2016 annual revenue of approximately $8 million.

Assets Held for Sale

During the fourth quarter of 2017 two of our businesses qualified as held for sale treatment. Accordingly an estimated loss of $16 million was recognized.

Restructuring and Asset Impairment Charges

12 Months Ended

Dec. 31, 2019

Restructuring and Related Activities [Abstract]

Restructuring and Asset Impairment Charges

From time to time, the Company will incur costs related to restructuring actions in order to optimize our cost base and more strategically position ourselves based on the economic environment and customer demand. During 2019, 2018 and 2017, the costs incurred primarily relate to an effort to reposition our European and North American businesses to optimize our cost structure and improve our operational efficiency and effectiveness. In 2019 and 2018 the charges included the reduction of headcount and consolidation of facilities within our Measurement & Control Solutions and Water Infrastructure segments, as well as headcount reductions within our Applied Water segment. In 2017 the charges included the reduction of headcount and consolidation of facilities within our Applied Water, Water Infrastructure, and Measurement & Control Solutions segments.

The following table presents the components of restructuring expense and asset impairment charges incurred during each of the previous three years:



	Year Ended December 31,
(in millions)	2019			2018			2017
By component:
Severance and other charges	$	51		$	19		$	20
Lease related charges	1			1			—
Other restructuring charges	2			1			2
Reversal of restructuring accruals	(1		)	(1		)	(2		)
Total restructuring charges	53			20			20
Asset impairment charges	10			2			5
Total restructuring and asset impairment charges	$	63		$	22		$	25

By segment:
Water Infrastructure	$	20		$	11		$	7
Applied Water	5			2			13
Measurement & Control Solutions	38			9			5
Corporate and other	—			—			—

Restructuring

The following table displays a roll-forward of the restructuring accruals, presented on our Consolidated Balance Sheets within "accrued and other current liabilities" and "other non-current accrued liabilities," for the years ended December 31, 2019 and 2018:



(in millions)	2019			2018
Restructuring accruals - January 1	$	5		$	7
Restructuring charges	53			20
Cash payments	(30		)	(21		)
Foreign currency and other	(1		)	(1		)
Restructuring accruals - December 31	$	27		$	5

By segment:
Water Infrastructure	$	1		$	1
Applied Water	—			1
Measurement & Control Solutions	19			2
Regional selling locations (a)	7			1


(a)	Regional selling locations consist primarily of selling and marketing organizations that incurred restructuring expense which was allocated to the segments. The liabilities associated with restructuring expense were not allocated to the segments.

The following table presents expected restructuring spend:



(in millions)	Water Infrastructure		Applied Water		Measurement & Control Solutions		Corporate		Total
Actions Commenced in 2019:
Total expected costs	$	19	$	5	$	28	$	—	$	52
Costs incurred during 2019	18		5		27		—		50
Total expected costs remaining	$	1	$	—	$	1	$	—	$	2

Actions Commenced in 2018:
Total expected costs	$	8	$	1	$	7	$	—	$	16
Costs incurred during 2018	7		1		7		—		15
Costs incurred during 2019	1		—		—		—		1
Total expected costs remaining	$	—	$	—	$	—	$	—	$	—

Actions Commenced in 2017:
Total expected costs	$	12	$	7	$	4	$	—	$	23
Costs incurred during 2017	5		4		2		—		11
Costs incurred during 2018	2		1		1		—		4
Costs incurred during 2019	1		—		1		—		2
Total expected costs remaining	$	4	$	2	$	—	$	—	$	6

The Water Infrastructure, Applied Water, and Measurement & Control Solutions actions commenced in 2019 consist primarily of severance charges. The Applied Water actions are complete, the Water Infrastructure actions are expected to continue through Q1 2020, and the Measurement & Control Solutions actions are expected to continue through the fourth quarter of 2020. The Water Infrastructure, Applied Water, and Measurement & Control Solutions actions commenced in 2018 consist primarily of severance charges and are complete. The Water Infrastructure, Applied Water, Measurement & Control Solutions and Corporate actions commenced in 2017 consist primarily of severance charges and are expected to continue through 2021.

Asset Impairment

During the first and third quarter of 2019 we determined that certain assets within our Measurement & Control Solutions segment, including customer relationships, internally developed software, proprietary technology, and plant property & equipment, were impaired. Accordingly we recognized an impairment charge of $10 million during the year.

During the fourth quarter of 2018 we determined that certain assets within our Water Infrastructure segment, including certain software, were impaired. Accordingly we recognized an impairment charge of $2 million. Refer to Note 12, "Goodwill and Other Intangible Assets," for additional information.

Revenue

12 Months Ended

Dec. 31, 2019

Revenue from Contract with Customer [Abstract]

Revenue

Disaggregation of Revenue

The following table illustrates the sources of revenue:



	Year Ended December 31,
(in millions)	2019		2018
Revenue from contracts with customers	$	5,002	$	4,963
Lease Revenue	247		244
Total	$	5,249	$	5,207

The following table reflects revenue from contracts with customers by application:



	Year Ended December 31,
(in millions)	2019		2018
Water Infrastructure
Transport	$	1,533	$	1,535
Treatment	397		397

Applied Water
Building Services	848		828
Industrial Water	693		706

Measurement and Control Solutions
Water	768		692
Energy	337		338
Software as a Service/Other	99		123
Test	327		344

Total	$	5,002	$	4,963

The following table reflects revenue from contracts with customers by geographical region:



	Year Ended December 31,
(in millions)	2019		2018
Water Infrastructure
United States	$	593	$	539
Europe	729		758
Asia Pacific	358		344
Other	250		291

Applied Water
United States	816		797
Europe	362		386
Asia Pacific	164		153
Other	199		198

Measurement and Control Solutions
United States	972		913
Europe	257		273
Asia Pacific	118		144
Other	184		167

Total	$	5,002	$	4,963

Contract Balances

We receive payments from customers based on a billing schedule as established in our contracts. Contract assets relate to costs incurred to perform in advance of scheduled billings. Contract liabilities relate to payments received

in advance of performance under the contracts. Change in contract assets and liabilities are due to our performance under the contract.

The table below provides contract assets, contract liabilities, and significant changes in contract assets and liabilities.



(in millions)	Contract Assets (a)			Contract Liabilities
Balance at 1/1/2018	$	89		$	107
Additions, net	87			101
Revenue recognized from opening balance	—			(89		)
Billings	(76		)	—
Other	(4		)	(6		)
Balance at 1/1/2019	$	96		$	113
Additions, net	81			114
Revenue recognized from opening balance	—			(91		)
Billings	(80		)	—
Other	9			(1		)
Balance at 12/31/2019	$	106		$	135


(a)	Excludes receivable balances which are disclosed on the balance sheet

Performance obligations

Delivery schedules vary from customer to customer based upon their requirements. Typically, large projects require longer lead production cycles and delays can occur from time to time. As of December 31, 2019, the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied for contracts with performance obligations, amount to $392 million. We expect to recognize the majority of revenue upon the completion of satisfying these performance obligations in the following 60 months. The Company elects to apply the practical expedient to exclude from this disclosure revenue related to performance obligations that are part of a contract whose original expected duration is less than one year.

Other Non-Operating Income, Net

12 Months Ended

Dec. 31, 2019

Other Income and Expenses [Abstract]

Other Non-Operating Income, Net

Other Non-Operating (Expense) Income, Net

The components of other non-operating income, net are as follows:



	Year Ended December 31,
(in millions)	2019			2018		2017
Interest income	$	5		$	4	$	3
Income from joint ventures	3			5		3
Other (expense) income – net	(12		)	4		—
Total other non-operating (expense) income, net	$	(4	)	$	13	$	6

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

The source of pre-tax income and the components of income tax expense are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Income components:
Domestic	$	203		$	208		$	162
Foreign	213			377			304
Total pre-tax income	$	416		$	585		$	466
Income tax expense components:
Current:
Domestic – federal	$	39		$	9		$	109
Domestic – state and local	13			13			9
Foreign	40			61			51
Total Current	92			83			169
Deferred:
Domestic – federal	$	7		$	17		$	(29	)
Domestic – state and local	(1		)	5			10
Foreign	(83		)	(69		)	(14		)
Total Deferred	(77		)	(47		)	(33		)
Total income tax provision	$	15		$	36		$	136
Effective income tax rate	3.7		%	6.1		%	29.2		%

Reconciliations between taxes at the U.S. federal income tax rate and taxes at our effective income tax rate on earnings before income taxes are as follows:



	Year Ended December 31,
	2019		2018		2017
Tax provision at U.S. statutory rate	21.0	%	21.0	%	35.0	%
Increase (decrease) in tax rate resulting from:
State income taxes	2.7		2.3		1.6
Uncertain tax positions	0.4		2.6		1.6
Valuation allowance	1.2		(47.1	)	3.3
Tax exempt interest	(3.0	)	(1.4	)	(10.6	)
Foreign tax rate differential	0.7		2.9		(6.7	)
Impact of foreign earnings, net	1.6		(1.7	)	37.0
Tax incentives	(9.6	)	(6.2	)	(6.6	)
Intercompany sale of assets	—		35.5		—
Other – net	1.7		(0.3	)	(0.5	)
Rate change	(18.1	)	—		(22.9	)
Goodwill impairment	7.8		—		—
Federal R&D tax credit	(1.2	)	(0.8	)	(1.0	)
Stock compensation	(1.5	)	(0.7	)	(1.0	)
Effective income tax rate	3.7	%	6.1	%	29.2	%

Certain prior year amounts included within the table of rate reconciliation above have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported consolidated balance sheets, consolidated statements of income, comprehensive income, stockholders’ equity, or cash flow. Additional line items have been included as of December 31, 2019 and for consistency the prior year balances have been adjusted to conform with the current year presentation.

We operate under tax incentives, which are effective through December 2023 and may be extended if certain additional requirements are satisfied. The tax incentives are conditional upon our meeting and maintaining certain

employment thresholds. The inability to meet the thresholds would have a prospective impact and at this time we continue to believe we will meet the requirements.

Deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax bases of assets and liabilities, applying enacted tax rates in effect for the year in which we expect the differences will reverse.

The following is a summary of the components of the net deferred tax assets and liabilities recognized in the Consolidated Balance Sheets:



	December 31,
(in millions)	2019			2018
Deferred tax assets:
Employee benefits	$	106		$	97
Accrued expenses	26			30
Loss and other tax credit carryforwards	240			279
Inventory	6			7
Lease Liabilities	57			—
Other	3			11
	438			424
Valuation allowance	(191		)	(234		)
Net deferred tax asset	$	247		$	190
Deferred tax liabilities:
Intangibles	$	160		$	247
Investment in foreign subsidiaries	7			8
Property, plant, and equipment	78			69
Lease right-of-use assets	57			—
Other	29			29
Total deferred tax liabilities	$	331		$	353

Management assesses all available positive and negative evidence, including prudent and feasible tax planning strategies, and estimates if sufficient future taxable income will be generated to realize existing deferred tax assets. On the basis of this evaluation, as of December 31, 2019, a valuation allowance of $191 million has been established to reduce the deferred income tax asset related to certain U.S. and foreign net operating losses and U.S. and foreign capital loss carryforwards.

A reconciliation of the change in valuation allowance on deferred tax assets is as follows:



(in millions)	2019			2018			2017
Valuation allowance — January 1	$	234		$	350		$	311
Change in assessment (a)	(2		)	1			(28		)
Current year operations	2			(271		)	48
Foreign currency and other (b)	(43		)	154			19
Valuation allowance — December 31	$	191		$	234		$	350


(a)	Decrease in assessment in 2019 is primarily attributable to profitability of certain jurisdictions. Increase in assessment in 2018 is primarily attributable to loss positions in various jurisdictions.


(b)	Included in foreign currency and other in 2018 is an increase in net operating losses due to amended prior year tax returns for which a valuation allowance was recorded. Included in foreign currency and other in 2019 is a decrease in net operating losses due primarily to the liquidation of a foreign subsidiary for which a valuation allowance was maintained.

Deferred taxes are classified in the Consolidated Balance Sheets as follows:



	December 31,
(in millions)	2019			2018
Non-current assets	$	226		$	140
Non-current liabilities	(310		)	(303		)
Total net deferred tax liabilities	$	(84	)	$	(163	)

Tax attributes available to reduce future taxable income begin to expire as follows:



(in millions)	December 31, 2019		First Year of Expiration
U.S. net operating loss	$	8	December 31, 2024
State net operating loss	98		December 31, 2020
State excess interest expense	9		Indefinitely
State tax credits	2		Indefinitely
Foreign net operating loss	1,018		December 31, 2020
Foreign tax credits	3		December 31, 2030

The Company has provided a deferred tax liability of $9 million for net foreign withholding taxes and state income taxes on $505 million of earnings expected to be repatriated to the U.S. parent, as of December 31, 2019. The Company currently does not intend to repatriate approximately $1.3 billion taxed under the Tax Act. The amount of deferred tax that would be recorded if such amounts were repatriated is not reasonably estimable.

Unrecognized Tax Benefits

We recognize tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities or upon the completion of the litigation process, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such positions are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



(in millions)	2019			2018			2017
Unrecognized tax benefits — January 1	$	136		$	130		$	67
Current year tax positions	3			—			56
Prior year tax positions	(5		)	7			7
Acquisitions	—			—			—
Settlements	(5		)	(1		)	—
Unrecognized tax benefits — December 31	$	129		$	136		$	130

The amount of unrecognized tax benefits at December 31, 2019 which, if ultimately recognized, will reduce our effective tax rate is $129 million. We believe that it is reasonably possible that unrecognized tax benefits will be reduced by approximately $4 million within the next 12 months as a result of the expiration of certain statute of limitations.

We classify interest relating to unrecognized tax benefits as a component of other non-operating (expense) income, net and tax penalties as a component of income tax expense in our Consolidated Income Statements. The amount of accrued interest relating to unrecognized tax benefits as of December 31, 2019 and 2018 was $8 million and $7 million.

During 2019, Xylem’s Swedish subsidiary received a tax assessment for the 2013 tax year related to the tax treatment of an intercompany transfer of certain intellectual property that was made in connection with a reorganization of our European businesses. The assessment asserts an aggregate amount of approximately $80 million for tax, penalties and interest. Xylem filed an appeal with the Administrative Court of Stockholm. Management, in consultation with external legal advisors, believes it is more likely than not that Xylem will prevail on the proposed assessment and is vigorously defending our position through litigation. As of December 31, 2019, we have not recorded any unrecognized tax benefits related to this uncertain tax position.

The following table summarizes our earliest open tax years by major jurisdiction:



Jurisdiction		Earliest Open Year
Italy		2013
Luxembourg		2016
Sweden		2013
Germany		2009
United Kingdom		2013
United States		2016
Switzerland		2017

Earnings Per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Earnings Per Share

The following is a reconciliation of the shares used in calculating basic and diluted earnings per share.



	Year Ended December 31,
	2019		2018		2017
Net income attributable to Xylem (in millions)	$	401	$	549	$	331
Shares (in thousands):
Weighted average common shares outstanding	179,958		179,750		179,602
Add: Participating securities (a)	29		27		27
Weighted average common shares outstanding — Basic	179,987		179,777		179,629
Plus incremental shares from assumed conversions: (b)
Dilutive effect of stock options	803		876		712
Dilutive effect of restricted stock units and performance share units	406		479		516
Weighted average common shares outstanding — Diluted	181,196		181,132		180,857
Basic earnings per share	$	2.23	$	3.05	$	1.84
Diluted earnings per share	$	2.21	$	3.03	$	1.83


(a)	Restricted stock awards containing rights to non-forfeitable dividends that participate in undistributed earnings with common shareholders are considered participating securities for purposes of computing earnings per share.

(b)

Incremental shares from stock options, restricted stock units and performance share units are computed by the treasury stock method. The weighted average shares listed below were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive for the periods presented or were otherwise excluded under the treasury stock method. The treasury stock method calculates dilution assuming the exercise of all in-the-money options and vesting of restricted stock units and performance share units, reduced by the repurchase of shares with the proceeds from the assumed exercises and unrecognized compensation expense for outstanding awards. Performance share units are included in the treasury stock calculation of diluted earnings per share based upon achievement of underlying performance and market conditions at the end of the reporting period, as applicable. See Note 17, "Stock-Based Compensation Plans" for further detail on the performance share units.



	Year Ended December 31,
(in thousands)	2019	2018	2017
Stock options	1,383	1,300	1,626
Restricted stock units	348	333	379
Performance share units	394	465	504

Inventories

12 Months Ended

Dec. 31, 2019

Inventory Disclosure [Abstract]

Inventories

The components of total inventories are summarized as follows:



	December 31,
(in millions)	2019		2018
Finished goods	$	212	$	248
Work in process	47		45
Raw materials	280		302
Total inventories	$	539	$	595

Property, Plant and Equipment

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Accrued and Other Current Liabilities

The components of total property, plant and equipment, net are as follows:



	December 31,
(in millions)	2019		2018
Land, buildings and improvements	$	339	$	326
Machinery and equipment	861		819
Equipment held for lease or rental	256		249
Furniture and fixtures	118		109
Construction work in progress	104		107
Other	24		22
Total property, plant and equipment, gross	1,702		1,632
Less accumulated depreciation	1,044		976
Total property, plant and equipment, net	$	658	$	656

Depreciation expense was $117 million, $117 million, and $109 million for 2019, 2018, and 2017, respectively.

Leases

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Leases

As discussed in Note 2, “Recently Issued Accounting Pronouncements,” Xylem adopted the new guidance on accounting for leases.

Leasing Arrangements

We lease certain offices, manufacturing buildings, transportation equipment, machinery, computers and other equipment. Our most significant lease liabilities relate to real estate leases. These leases include renewal, termination or purchase options, and we have assessed these to determine whether it is reasonably certain for us to exercise any of the previously mentioned options. All periods relating to options that are reasonably certain to be exercised have been included in the lease term of the respective leases.

We did not identify any events or conditions during the twelve month period ended December 31, 2019 to indicate that a reassessment or re-measurement of our existing leases was required. There also were no impairment indicators identified during the twelve month period ended December 31, 2019 that required an impairment test for the Company’s ROU assets.

Our current lease liabilities of $61 million are included in "Accrued and other current liabilities" and our non-current lease liabilities of $185 million are included in "Other non-current accrued liabilities" as of December 31, 2019. Our ROU asset balances are included in "Other non-current assets". The net balance of our ROU assets as of December 31, 2019 was $241 million. These balances include an immaterial amount related to finance leases.

The components of our lease cost were as follows:



	Year Ended
(in millions)	December 31, 2019
Lease cost
Operating lease cost	$	76
Short-term lease cost	9
Variable lease cost	19
Total lease cost	$	104

The supplemental cash flow information related to leases are as follows:



	Year Ended
(in millions)	December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	73

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	33

Information relating to the lease term and discount rate are as follows:



	Year Ended
	December 31, 2019
Weighted-average remaining lease term (years)
Operating leases	6 Years

Weighted-average discount rate
Operating leases	2.7%

As of December 31, 2019, the maturities of operating lease liabilities were as follows:



(in millions)
2020	$	65
2021	50
2022	37
2023	29
2024	21
Thereafter	62
Total lease payments	264
Less: Imputed interest	(21		)
Total	$	243

Disclosures related to periods prior to adoption of the New Lease Standard as reported and provided in our 2018 Annual Report.

We lease certain offices, manufacturing buildings, machinery, computers and other equipment. We often pay maintenance, insurance and tax expense related to leased assets. Total rent expense for the two years ended December 31, 2018 was as follows:



(in millions)	Total
2018	81
2017	70

As of December 31, 2018, we were obligated to make minimum future rental payments under operating leases as follows:



(in millions)
2019	$	76
2020	61
2021	43
2022	33
2023	22
Thereafter	64
Total lease payments	299

Lessor arrangements

In addition to manufacturing and selling equipment, we also lease out equipment to customers in exchange for consideration. These arrangements are generally short term in nature and predominantly involve the rental of pumps and accessories within the Water Infrastructure segment. Rental arrangements generally do not provide the customer the right to purchase the equipment as Xylem’s strategy is to rent these items over their useful lives. Customers may be billed based on daily, weekly or monthly rates depending on the expected rental period. We assessed that these arrangements constitute a lease under ASC 842, and have recognized them as operating leases. In situations where arrangements contain both the sale of products and a leasing component, contract consideration is allocated based on relative standalone selling price.

Total revenue from lease arrangements was $247 million for the twelve month period ended December 31, 2019. Our gross assets available for rent and related accumulated amortization were $256 million and $166 million, respectively, as of December 31, 2019. Depreciation expense for these assets were $28 million for the twelve month period ended December 31, 2019.

Leases

As discussed in Note 2, “Recently Issued Accounting Pronouncements,” Xylem adopted the new guidance on accounting for leases.

Leasing Arrangements

The components of our lease cost were as follows:



	Year Ended
(in millions)	December 31, 2019
Lease cost
Operating lease cost	$	76
Short-term lease cost	9
Variable lease cost	19
Total lease cost	$	104

The supplemental cash flow information related to leases are as follows:



	Year Ended
(in millions)	December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	73

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	33

Information relating to the lease term and discount rate are as follows:



	Year Ended
	December 31, 2019
Weighted-average remaining lease term (years)
Operating leases	6 Years

Weighted-average discount rate
Operating leases	2.7%

As of December 31, 2019, the maturities of operating lease liabilities were as follows:



(in millions)
2020	$	65
2021	50
2022	37
2023	29
2024	21
Thereafter	62
Total lease payments	264
Less: Imputed interest	(21		)
Total	$	243

Disclosures related to periods prior to adoption of the New Lease Standard as reported and provided in our 2018 Annual Report.



(in millions)	Total
2018	81
2017	70

As of December 31, 2018, we were obligated to make minimum future rental payments under operating leases as follows:



(in millions)
2019	$	76
2020	61
2021	43
2022	33
2023	22
Thereafter	64
Total lease payments	299

Lessor arrangements

Accrued and Other Current Liabilities

12 Months Ended

Dec. 31, 2019

Payables and Accruals [Abstract]

The components of total accrued and other current liabilities are as follows:



	December 31,
(in millions)	2019		2018
Compensation and other employee-benefits	$	199	$	194
Customer-related liabilities	153		129
Accrued warranty costs	36		44
Lease liabilities	61		—
Accrued taxes	79		85
Other accrued liabilities	100		94
Total accrued and other current liabilities	$	628	$	546

Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill

Changes in the carrying value of goodwill by reportable segment during the years ended December 31, 2019 and 2018 are as follows:



(in millions)	Water Infrastructure			Applied Water			Measurement & Control Solutions			Total
Balance as of December 31, 2017	$	667		$	526		$	1,575		$	2,768
Activity in 2018
Divested/acquired	—			—			279			279
Foreign currency and other	(14		)	(10		)	(47		)	(71		)
Balance as of December 31, 2018	$	653		$	516		$	1,807		$	2,976
Activity in 2019
Acquired	—			—			19			19
Impairment	—			—			(148		)	(148		)
Foreign currency and other	(2		)	(3		)	(3		)	(8		)
Balance as of December 31, 2019	$	651		$	513		$	1,675		$	2,839

During the third quarter of 2019, the Company recorded a goodwill impairment charge of $148 million related to the Advanced Infrastructure Analytics (“AIA”) goodwill reporting unit. The impairment resulted from a downward revision of forecasted future cash flows. Factors that contributed to the revised forecast in the third quarter include lower than expected results as compared to prior forecasts, largely as a result of slower-than-expected conversion of pipeline opportunities to revenue. Additionally, we have continued to invest in the AIA platform ahead of the adoption curve, which has also impacted the near-term profitability of the business. These factors drove the decrease in forecasted cash flows, and as such, the calculated fair value of the AIA reporting unit below its carrying value as of the July 1, 2019.

To determine the fair value of the AIA reporting unit, the Company used the income approach. Under the income approach, the fair value of the AIA reporting unit was based on the present value of the estimated cash flows that the reporting unit is expected to generate over its remaining life. Cash flow projections were based on management’s estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. The discount rate was based on the weighted average cost of capital appropriate for the AIA reporting unit.

During the fourth quarter of 2019, we performed our annual impairment assessment and determined that the estimated fair values of our goodwill reporting units were in excess of each of their carrying values. However, future goodwill impairment tests could result in a charge to earnings. We will continue to evaluate goodwill on an annual basis as of the beginning of our fourth quarter and whenever events and changes in circumstances indicate there may be a potential impairment.

Other Intangible Assets

Information regarding our other intangible assets is as follows:



(in millions)	December 31, 2019							December 31, 2018
	Carrying Amount		Accumulated Amortization			Net Intangibles		Carrying Amount		Accumulated Amortization			Net Intangibles
Customer and distributor relationships	$	945	$	(352	)	$	593	$	951	$	(286	)	$	665
Proprietary technology and patents	204		(111		)	93		198		(93		)	105
Trademarks	148		(52		)	96		148		(41		)	107
Software	428		(206		)	222		355		(164		)	191
Other	20		(16		)	4		24		(19		)	5
Indefinite-lived intangibles	166		—			166		159		—			159
Other intangibles	$	1,911	$	(737	)	$	1,174	$	1,835	$	(603	)	$	1,232

We determined that no impairment of the indefinite-lived intangibles existed as of the measurement date of our impairment assessment in 2019 or 2018. Future impairment tests could result in a charge to earnings. We will continue to evaluate the indefinite-lived intangible assets on an annual basis as of the beginning of our fourth quarter and whenever events and changes in circumstances indicate there may be a potential impairment.

Customer and distributor relationships, proprietary technology and patents, trademarks, software and other are amortized over weighted average lives of approximately 14 years, 14 years, 13 years, 6 years and 3 years, respectively.

Total amortization expense for intangible assets was $140 million, $144 million, and $125 million for 2019, 2018 and 2017, respectively.

Estimated amortization expense for each of the five succeeding years is as follows:



(in millions)
2020	$	136
2021	124
2022	115
2023	108
2024	99

During the third quarter of 2019, the Company also assessed whether the carrying amounts of the AIA reporting unit’s long-lived assets may not be recoverable based on the revised forecasted cash flows, and therefore impaired. Our assessment resulted in an impairment charge of $7 million, primarily related to customer relationships, proprietary technology, software and property, plant and equipment. The charge was calculated using an income approach, which is considered a Level 3 input for fair value measurement, and is reflected in “Restructuring and asset impairment charges” in our Consolidated Income Statements.

During the first quarter of 2019, we determined that the intended use of a finite lived customer relationship within the test application of our Measurement & Control Solutions segment had changed. Accordingly we recorded a $3 million impairment charge. The charge was also calculated using the income approach and is reflected in “Restructuring and asset impairment charges” in our Consolidated Income Statements.

Credit Facilities and Long-Term Debt

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Credit Facilities and Long-Term Debt

Credit Facilities and Debt

Total debt outstanding is summarized as follows:



	December 31,
(in millions)	2019			2018
4.875% Senior Notes due 2021 (a)	$	600		$	600
2.250% Senior Notes due 2023 (a)	557			570
3.250% Senior Notes due 2026 (a)	500			500
4.375% Senior Notes due 2046 (a)	400			400
Commercial paper	276			—
Term loan	—			257
Debt issuance costs and unamortized discount (b)	(17		)	(19		)
Total debt	2,316			2,308
Less: short-term borrowings and current maturities of long-term debt	276			257
Total long-term debt	$	2,040		$	2,051

(a)

The fair value of our Senior Notes (as defined below) was determined using quoted prices in active markets for identical securities, which are considered Level 1 inputs. The fair value of our Senior Notes due 2021 (as defined below) was $629 million and $620 million as of December 31, 2019 and 2018, respectively. The fair value of our Senior Notes due 2023 (as defined below) was $591 million and $599 million as of December 31, 2019 and 2018, respectively. The fair value of our Senior Notes due 2026 (as defined below) was $518 million and $476 million as of December 31, 2019 and 2018, respectively. The fair value of our Senior Notes due 2046 (as defined below) was $431 million and $397 million as of December 31, 2019 and 2018, respectively.


(b)	The debt issuance costs and unamortized discount is recognized as a reduction in the carrying value of the Senior Notes in the Consolidated Balance Sheets and is being amortized to interest expense in our Consolidated Income Statements over the expected remaining terms of the Senior Notes.

Senior Notes

On September 20, 2011, we issued 4.875% Senior Notes of $600 million aggregate principal amount due October 2021 (the "Senior Notes due 2021"). On March 11, 2016, we issued 2.250% Senior Notes of €500 million aggregate principal amount due March 2023 (the "Senior Notes due 2023"). On October 11, 2016, we issued 3.250% Senior Notes of $500 million aggregate principal amount due October 2026 (the “Senior Notes due 2026”) and 4.375% Senior Notes of $400 million aggregate principal amount due October 2046 (the “Senior Notes due 2046” and, together with the Senior Notes due 2021, the Senior Notes due 2023 and the Senior Notes due 2026, the “Senior Notes”).

The Senior Notes include covenants that restrict our ability, subject to exceptions, to incur debt secured by liens and engage in sale and leaseback transactions, as well as provide for customary events of default (subject, in certain cases, to receipt of notice of default and/or customary grace and cure periods). We may redeem the Senior Notes, as applicable, in whole or in part, at any time at a redemption price equal to the principal amount of the Senior Notes to be redeemed, plus a make-whole premium. We may also redeem the Senior Notes in certain other circumstances, as set forth in the applicable Senior Notes indenture.

If a change of control triggering event (as defined in the applicable Senior Notes indenture) occurs, we will be required to make an offer to purchase the Senior Notes at a price equal to 101% of their principal amount plus accrued and unpaid interest to the date of repurchase.

Interest on the Senior Notes due 2021 is payable on April 1 and October 1 of each year. Interest on the Senior Notes due 2023 is payable on March 11 of each year. Interest on the Senior Notes due 2026 and the Senior Notes due 2046 is payable on May 1 and November 1 of each year beginning on May 1, 2017. As of December 31, 2019, we were in compliance with all covenants for the Senior Notes.

Credit Facilities

2015 Five-Year Revolving Credit Facility

Effective March 27, 2015, Xylem entered into a five-year revolving credit facility (the "2015 Credit Facility") with Citibank, N.A., as administrative agent, and a syndicate of lenders. The 2015 Credit Facility provides for an aggregate principal amount of up to $600 million of: (i) revolving extensions of credit (the "revolving loans") outstanding at any time and (ii) the issuance of letters of credit in a face amount not in excess of $100 million outstanding at any time. The 2015 Credit Facility provides for increases of up to $200 million for a possible maximum total of $800 million in aggregate principal amount at our request and with the consent of the institutions providing such increased commitments. On March 5, 2019 Xylem terminated the 2015 Credit Facility among the Company, certain lenders and Citibank, N.A. as Administrative Agent.

2019 Five-Year Revolving Credit Facility

On March 5, 2019, Xylem entered into a five-year revolving credit facility (the “2019 Credit Facility”) with Citibank, N.A., as Administrative Agent, and a syndicate of lenders. The 2019 Credit Facility provides for an aggregate principal amount of up to $800 million (available in U.S. Dollars and in Euros), with increases of up to $200 million for a maximum aggregate principal amount of $1 billion at the request of Xylem and with the consent of the institutions providing such increased commitments.

Interest on all loans under the 2019 Credit Facility is payable either quarterly or at the expiration of any LIBOR or EURIBOR interest period applicable thereto. Borrowings accrue interest at a rate equal to, at Xylem's election, a base rate or an adjusted LIBOR or EURIBOR rate plus an applicable margin. The 2019 Credit Facility includes customary provisions for implementation of replacement rates for LIBOR-based and EURIBOR-based loans. The 2019 Credit Facility also includes a pricing grid that determines the applicable margin based on Xylem's credit rating, with a further adjustment depending on Xylem's annual Sustainalytics Environmental, Social and Governance score. Xylem will also pay quarterly fees to each lender for such lender’s commitment to lend accruing on such commitment at a rate based on our credit rating, whether such commitment is used or unused, as well as a quarterly letter of credit fee accruing on the letter of credit exposure of such lender during the preceding quarter at a rate based on the credit rating of Xylem (as adjusted for the Sustainalytics Environmental, Social and Governance score).

The 2019 Credit Facility requires that Xylem maintain a consolidated total debt to consolidated EBITDA ratio, which will be based on the last four fiscal quarters, and in addition a number of customary covenants, including limitations on the incurrence of secured debt and debt of subsidiaries, liens, sale and lease-back transactions, mergers, consolidations, liquidations, dissolutions and sales of assets. The 2019 Credit Facility also contains customary events of default. Finally, Xylem has the ability to designate subsidiaries that can borrow under the 2019 Credit Facility, subject to certain requirements and conditions set forth in the 2019 Credit Facility. As of December 31, 2019, the 2019 Credit Facility was undrawn and we are in compliance with all covenants.

Commercial Paper

U.S. Dollar Commercial Paper Program

Our U.S. Dollar commercial paper program generally serves as a means of short-term funding with a $600 million maximum issuing balance and a combined limit of $800 million inclusive of the 2019 Credit Facility. As of December 31, 2019 and 2018, none of the Company's $600 million U.S. Dollar commercial paper program was outstanding. We have the ability to continue borrowing under this program going forward in in future periods.

Euro Commercial Paper Program

On June 3, 2019 Xylem entered into a Euro commercial paper program with ING Bank N.V., as administrative

agent, and a syndicate of dealers. The Euro commercial paper program provides for a maximum issuing balance

of up to €500 million (approximately $557 million) which may be denominated in a variety of currencies. The

maximum issuing balance may be increased in accordance with the agreement. As of December 31, 2019, $276 million of the Company's Euro commercial paper program was outstanding at a weighted average

interest rate of (0.22)%. We have the ability to continue borrowing under this program going forward in future

periods.

Term Loan Facility

On January 26, 2018, the Company’s subsidiary, Xylem Europe GmbH (the “borrower”) entered into a 12-month €225 million (approximately $251 million) term loan facility (the “Term Facility”) at an interest rate of 0.45% in which the terms are set forth in a term loan agreement, among the borrower, the Company, as parent guarantor and ING Bank. The Company has entered into a parent guarantee in favor of ING Bank also dated January 26, 2018 to secure all present and future obligations of the borrower under the Term Loan Agreement. The Term Facility was used to partially fund the acquisition of Pure Technologies Ltd in 2018 and the maturity date has since been extended through February 2020. As of December 31, 2019 and December 31, 2018, $0 million and $257 million were outstanding under the Term Facility, respectively.

Derivative Financial Instruments

12 Months Ended

Dec. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Risk Management Objective of Using Derivatives

We are exposed to certain risks arising from both our business operations and economic conditions, and we principally manage our exposures to these risks through management of our core business activities. Certain of our foreign operations expose us to fluctuations of interest rates and exchange rates that may impact revenue, expenses, cash receipts, cash payments, and the value of our stockholders' equity. We enter into derivative financial instruments to protect the value or fix the amount of certain cash flows in terms of the functional currency of the business unit with that exposure and reduce the volatility in stockholders' equity.

Cash Flow Hedges of Foreign Exchange Risk

We are exposed to fluctuations in various foreign currencies against our functional currencies. We use foreign currency derivatives, including currency forward agreements, to manage our exposure to fluctuations in the various exchange rates. Currency forward agreements involve fixing the foreign currency exchange rate for delivery of a specified amount of foreign currency on a specified date.

Certain business units with exposure to foreign currency exchange risks have designated certain currency forward agreements as cash flow hedges of forecasted intercompany inventory purchases and sales. Our principal currency exposures relate to the Euro, Swedish Krona, British Pound, Canadian Dollar, Polish Zloty, and Australian Dollar. We had foreign exchange contracts with purchase notional amounts totaling $0 million and $506 million as of December 31, 2019 and 2018, respectively. As of December 31, 2018, our most significant foreign currency derivatives included contracts to sell U.S. Dollar and purchase Euro, purchase Swedish Krona and sell Euro, sell British Pound and purchase Euro, purchase Polish Zloty and sell Euro, purchase U.S. Dollar and sell Canadian Dollar and to sell Canadian Dollar and purchase Euro. The purchase notional amounts associated with these currency derivatives were $191 million, $168 million, $52 million, $37 million, $29 million and $22 million, respectively. We entered into new foreign exchange contracts as of the first quarter of 2020.

Hedges of Net Investments in Foreign Operations

We are exposed to changes in foreign currencies impacting our net investments held in foreign subsidiaries.

Cross Currency Swaps

Beginning in 2015, we entered into cross currency swaps to manage our exposure to fluctuations in the Euro-U.S. Dollar exchange rate. During the second quarter of 2019 we entered into additional cross currency swaps. The total notional amount of derivative instruments designated as net investment hedges was $714 million and $426 million as of December 31, 2019 and 2018, respectively.

Foreign Currency Denominated Debt

On March 11, 2016, we issued 2.250% Senior Notes of €500 million aggregate principal amount due March 2023. We designated the entirety of the outstanding balance, or $554 million and $566 million as of December 31, 2019 and 2018, respectively, net of unamortized discount, as a hedge of a net investment in certain foreign subsidiaries.

The table below presents the effect of our derivative financial instruments on the Consolidated Income Statements and Consolidated Statements of Comprehensive Income:



	Year Ended December 31,
(in millions)	2019			2018			2017
Derivatives in Cash Flow Hedges
Foreign Exchange Contracts
Amount of (loss) gain recognized in OCI (a)	$	(14	)	$	(8	)	$	9
Amount of loss (gain) reclassified from OCI into revenue (a)	7			—			(6		)
Amount of loss reclassified from OCI into cost of revenue (a)	5			4			1

Derivatives in Net Investment Hedges
Cross Currency Swaps
Amount of gain (loss) recognized in OCI (a)	$	22		$	22		$	(53	)
Amount income recognized in Interest Expense	16			2			—
Foreign Currency Denominated Debt
Amount of gain (loss) recognized in OCI (a)	$	13		$	27		$	(74	)


(a)	Effective portion

As of December 31, 2019, $3 million of the net losses on cash flow hedges is expected to be reclassified into earnings in the next 12 months.

As of December 31, 2019, no gains or losses on the net investment hedges are expected to be reclassified into earnings over the next 12 months.

The ineffective portion of the change in fair value of a cash flow hedge was not material for 2019, 2018, and 2017.

The net investment hedges did not experience any ineffectiveness in 2019, 2018 and 2017.

The fair values of our derivative assets and liabilities are measured on a recurring basis using Level 2 inputs and are determined through the use of models that consider various assumptions including yield curves, time value and other measurements.

The fair values of our derivative contracts currently included in our hedging program were as follows:



	December 31,
(in millions)	2019			2018
Derivatives designated as hedging instruments
Assets
Cash Flow Hedges
Other current assets	$	—		$	3
Net Investment Hedges
Other non-current assets	4			—
Liabilities
Cash Flow Hedges
Other current liabilities	—			(1		)
Net Investment Hedges
Other non-current liabilities	(24		)	(46		)

The fair value of our long-term debt, due in 2023, designated as a net investment hedge was $591 million and $599 million as of December 31, 2019 and 2018, respectively.

Postretirement Benefit Plans

12 Months Ended

Dec. 31, 2019

Retirement Benefits [Abstract]

Postretirement Benefit Plans

Defined contribution plans – Xylem and certain of our subsidiaries maintain various defined contribution savings plans, which allow employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. Several of the plans require us to match a percentage of the employee contributions up to certain limits, generally between 3.0% – 7.0% of employee eligible pay. Matching obligations, the majority of which were funded in cash in connection with the plans, and other company contributions are as follows:



(in millions)	Defined Contribution
2019	$	49
2018	39
2017	38

The Xylem Stock Fund, an investment option under the defined contribution plan in which Company employees participate is considered an Employee Stock Ownership Plan. As a result, participants in the Xylem Stock Fund may receive dividends in cash or may reinvest such dividends into the Xylem Stock Fund. Company employees held approximately 302 thousand and 328 thousand shares of Xylem Inc. common stock in the Xylem Stock Fund at December 31, 2019 and 2018, respectively.

Defined benefit pension plans and other postretirement plans – We historically have maintained qualified and nonqualified defined benefit retirement plans covering certain current and former employees, including hourly and union plans as well as salaried plans, which generally require up to 5 years of service to be vested and for which the benefits are determined based on years of credited service and either specified rates, final pay, or final average pay. The other postretirement benefit plans are all unfunded plans in the U.S. and Canada.

During 2019 and 2018, we made several amendments to plans that had no material impact to the Company's financial statements.

Amounts recognized in the Consolidated Balance Sheets for pension and other employee-related benefit plans (collectively, postretirement plans) reflect the funded status of the postretirement benefit plans. The following table provides a summary of the funded status of our postretirement plans, the presentation of such balances and a summary of amounts recorded within accumulated other comprehensive income:



(in millions)	December 31, 2019									December 31, 2018
	Pension			Other			Total			Pension			Other			Total
Fair value of plan assets	$	605		$	—		$	605		$	567		$	—		$	567
Projected benefit obligation	(959		)	(49		)	(1,008		)	(862		)	(52		)	(914		)
Funded status	$	(354	)	$	(49	)	$	(403	)	$	(295	)	$	(52	)	$	(347	)
Amounts recognized in the balance sheet
Other non-current assets	$	58		$	—		$	58		$	68		$	—		$	68
Accrued and other current liabilities	(13		)	(3		)	(16		)	(12		)	(3		)	(15		)
Accrued postretirement benefits	(399		)	(46		)	(445		)	(351		)	(49		)	(400		)
Net amount recognized	$	(354	)	$	(49	)	$	(403	)	$	(295	)	$	(52	)	$	(347	)
Accumulated other comprehensive income (loss):
Net actuarial losses	$	(330	)	$	(19	)	$	(349	)	$	(260	)	$	(24	)	$	(284	)
Prior service credit	(3		)	7			4			(4		)	12			8
Total	$	(333	)	$	(12	)	$	(345	)	$	(264	)	$	(12	)	$	(276	)

The unrecognized amounts recorded in accumulated other comprehensive income will be subsequently recognized as expense on a straight-line basis only to the extent they exceed 10% of the higher of the market-related value or the projected benefit obligation, over the average remaining service period of active participants, or for plans with all or substantially all inactive participants, over the average remaining life expectancy. Actuarial gains and losses incurred in future periods and not recognized as expense in those periods will be recognized as increases or decreases in other comprehensive income, net of tax.

The net actuarial loss included in accumulated other comprehensive income at the end of 2019 and expected to be recognized in net periodic benefit cost during 2020 is $18 million ($14 million, net of tax). The prior service credit included in accumulated other comprehensive income to be recognized in 2020 is $3 million ($2 million, net of tax).

The Company has initiated the process for a full buy-out of its largest defined benefit plan in the UK. In order to prepare for a buy-out, the plan's assets were converted to cash, cash equivalents or other highly liquid assets as of the third quarter 2019. In addition, the Company completed an enhanced transfer value ("ETV") exercise for the deferred vested participants of the plan. The ETV offered the participants an enhanced lump sum to transfer their full pension rights out of the plan. Lump sum payments of $21 million were paid out of the plan assets, and the Company recorded a settlement charge of $8 million during the third quarter. Prior to the settlement accounting, the plan was re-measured as of July 31, 2019, resulting in an increase in the plan's projected benefit obligation of $37 million, an increase in plan assets of $26 million and an increase to losses in accumulated other comprehensive income of $11 million. The assumptions used to re-measure the plan were developed in the same manner as at December 31, 2018. However, due to the recent change in the investment assets, the expected rate of return on assets for this plan was changed from 7.25% to 0.70%. The discount rate used in the re-measurement was 2.00%, down from 3.00% at December 31, 2018. The Company recorded incremental net periodic benefit cost of $3 million in the third quarter and $5 million in the fourth quarter as a result of the re-measurement and the investment change.

The benefit obligation, fair value of plan assets, funded status, and amounts recognized in the consolidated financial statements for our defined benefit domestic and international pension plans were:



	Domestic Plans						International Plans
	December 31,						December 31,
(in millions)	2019			2018			2019			2018
Change in benefit obligation:
Benefit obligation at beginning of year	$	99		$	107		$	763		$	843
Service cost	3			3			9			9
Interest cost	4			4			19			19
Benefits paid	(7		)	(5		)	(28		)	(36		)
Actuarial loss (gain)	15			(10		)	104			(20		)
Plan amendments, settlements and curtailments	—			—			(23		)	3
Foreign currency translation/other	(1		)	—			2			(55		)
Benefit obligation at end of year	$	113		$	99		$	846		$	763
Change in plan assets:
Fair value of plan assets at beginning of year	$	97		84			$	470		$	544
Employer contributions	—			22			16			16
Actual return on plan assets	17			(4		)	52			(20		)
Benefits paid	(7		)	(5		)	(28		)	(36		)
Plan amendments, settlements and curtailments	—			—			(23		)	—
Foreign currency translation/other	(2		)	—			13			(34		)
Fair value of plan assets at end of year	$	105		$	97		$	500		$	470
Unfunded status of the plans	$	(8	)	$	(2	)	$	(346	)	$	(293	)

The following table provides a rollforward of the projected benefit obligation for the other postretirement employee benefit plans:



(in millions)	2019			2018
Change in benefit obligation:
Benefit obligation at beginning of year	$	52		$	55
Service cost	—			—
Interest cost	2			2
Benefits paid	(3		)	(3		)
Actuarial gain/(loss)	(2		)	1
Plan Amendment and other	—			(3		)
Benefit obligation at the end of year	$	49		$	52

The accumulated benefit obligation (“ABO”) for all the defined benefit pension plans was $919 million and $829 million at December 31, 2019 and 2018, respectively.

For defined benefit pension plans in which the ABO was in excess of the fair value of the plans’ assets, the projected benefit obligation, ABO and fair value of the plans’ assets were as follows:



	December 31,
(in millions)	2019		2018
Projected benefit obligation	$	562	$	500
Accumulated benefit obligation	526		470
Fair value of plan assets	150		137

The components of net periodic benefit cost for our defined benefit pension plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Domestic defined benefit pension plans:
Service cost	$	3		$	3		$	3
Interest cost	4			4			4
Expected return on plan assets	(8		)	(7		)	(6		)
Amortization of net actuarial loss	1			2			2
Net periodic benefit cost	$	—		$	2		$	3
International defined benefit pension plans:
Service cost	$	9		$	9		$	12
Interest cost	19			19			21
Expected return on plan assets	(27		)	(35		)	(34		)
Amortization of net actuarial loss	9			9			9
Settlement	9			1			1
Net periodic benefit cost	$	19		$	3		$	9
Total net periodic benefit cost	$	19		$	5		$	12

The components of net periodic benefit cost other than the service cost component are included in the line item "other non-operating income (expense), net" in the Consolidated Income Statements.

Other changes in plan assets and benefit obligations recognized in other comprehensive loss, as they pertain to our defined benefit pension plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Domestic defined benefit pension plans:
Net (gain) loss	$	6		$	1		$	1
Prior service cost	—			—			1
Amortization of net actuarial loss	(1		)	(2		)	(2		)
(Gains) losses recognized in other comprehensive loss	$	5		$	(1	)	$	—
International defined benefit pension plans:
Net (gain) loss	$	79		$	35		$	23
Prior service credit	—			3			1
Amortization of net actuarial loss	(9		)	(9		)	(9		)
Settlement	(9		)	(1		)	(1		)
Foreign Exchange	3			(15		)	19
(Gains) losses recognized in other comprehensive loss	$	64		$	13		$	33
Total (gains) losses recognized in other comprehensive loss	$	69		$	12		$	33
Total (gains) losses recognized in comprehensive income	$	88		$	17		$	45

The components of net periodic benefit cost for other postretirement employee benefit plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Service cost	$	—		$	—		$	1
Interest cost	2			2			2
Amortization of prior service credit	(4		)	(4		)	(3		)
Amortization of net actuarial loss	2			2			2
Net periodic benefit cost	$	—		$	—		$	2

Other changes in benefit obligations recognized in other comprehensive loss, as they pertain to other postretirement employee benefit plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Net loss (gain)	$	(2	)	$	1		$	(5	)
Prior service credit	—			(3		)	(3		)
Amortization of prior service credit	4			4			3
Amortization of net actuarial loss	(2		)	(2		)	(2		)
Foreign Exchange/Other	—			—			(1		)
Losses (gains) recognized in other comprehensive loss	$	—		$	—		$	(8	)
Total losses (gains) recognized in comprehensive income	$	—		$	—		$	(6	)

Assumptions

The following table provides the weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost, as they pertain to our pension plans.



	2019				2018				2017
	U.S.		Int’l		U.S.		Int’l		U.S.		Int’l
Benefit Obligation Assumptions
Discount rate	3.25	%	1.80	%	4.50	%	2.60	%	3.75	%	2.43	%
Rate of future compensation increase	NM		2.94	%	NM		2.92	%	NM		2.93	%
Net Periodic Benefit Cost Assumptions
Discount rate	4.50	%	2.60	%	3.75	%	2.43	%	4.25	%	2.63	%
Expected long-term return on plan assets	7.75	%	6.96	%	8.00	%	7.23	%	8.00	%	7.20	%
Rate of future compensation increase	NM		2.92	%	NM		2.93	%	NM		2.76	%


NM	Not meaningful. The pension benefits for future service for all the U.S. pension plans are based on years of service and not impacted by future compensation increases.

Management develops each assumption using relevant company experience in conjunction with market-related data for each individual country in which plans exist. Assumptions are reviewed annually and adjusted as necessary.

The expected long-term rate of return on assets reflects the expected returns for each major asset class in which the plans hold investments, the weight of each asset class in the target mix, the correlations among asset classes and their expected volatilities. The assets of the pension plans are held by a number of independent trustees, managed by several investment institutions and are accounted for separately in the Company’s pension funds.

Our expected return on plan assets is estimated by evaluating both historical returns and estimates of future returns. Specifically, we analyze the plans’ actual historical annual return on assets, net of fees, over the past 15, 20 and 25 years; estimate future returns based on independent estimates of asset class returns; and evaluate historical broad market returns over long-term timeframes based on our asset allocation range. For the U.S. Master Trust which has only existed since 2011, historical returns were estimated using a constructed portfolio that reflects the Company’s strategic asset allocation and the historical compound geometric returns of each asset class for the longest time period available. Based on this approach, the weighted average expected long-term rate of return for all of our plan assets to be used in determining net periodic benefit costs for 2020 is estimated at 3.46%.

The table below provides the weighted average actual rate of return generated on all of our plan assets during each of the years presented as compared to the weighted average expected long-term rates of return utilized in calculating the net periodic benefit costs.



	2019		2018		2017
Expected long-term rate of return on plan assets	7.09	%	7.34	%	7.30	%
Actual rate of return (loss) on plan assets	12.59	%	(3.85	)%	5.70	%

The assumed rate of future increases in the per capita cost of health care (the health care trend rate) is 6.53% for 2020, decreasing ratably to 4.50% in 2028. An increase or decrease in the health care trend rates by one percent per year would impact the aggregate annual service and interest components by less than $1 million, and impact the benefit obligation by approximately $3 million.

Investment Policy

The investment strategy for managing worldwide postretirement benefit plan assets is to seek an optimal rate of return relative to an appropriate level of risk for each plan. Investment strategies vary by plan, depending on the specific characteristics of the plan, such as plan size and design, funded status, liability profile and legal requirements. In general, the plans are managed closely to their strategic allocations.

During 2019 the Company updated its investment policy for the Xylem UK Pension Plan (the "UK Plan"), its largest defined benefit plan in the UK, to prepare for a full buy-out. As of the third quarter, the UK Plan's assets were converted to cash, cash equivalents or other highly liquid assets. At December 31, 2019, the assets of the UK Plan were held in cash or cash equivalents, hedging instruments and government bonds for $272 million, $35 million and $11 million, respectively.

The following table provides the actual asset allocations of plan assets as of December 31, 2019 and 2018, and the related asset target allocation ranges by asset category.



	2019		2018		Target Allocation Ranges
Equity securities	18.6	%	29.7	%	15-60%
Fixed income	31.7	%	24.5	%	10-50%
Hedge funds	2.0	%	11.8	%	0-40%
Private equity	—	%	1.1	%	0-30%
Cash, insurance contracts and other	47.7	%	32.9	%	0-60%

Fair Value of Plan Assets

In measuring plan assets at fair value, the fair value hierarchy is applied which categorizes and prioritizes the inputs used to estimate fair value into three levels. See Note 1 "Summary of Significant Accounting Policies" for further detail on fair value hierarchy.

In certain instances, fair value is estimated using quoted market prices obtained from external pricing services. In obtaining such data from the pricing service, we have evaluated the methodologies used to develop the estimate of fair value in order to assess whether such valuations are representative of fair value, including net asset value ("NAV"). Additionally, in certain circumstances, the NAV reported by an asset manager may be adjusted when sufficient evidence indicates NAV is not representative of fair value.

The following is a description of the valuation methodologies and inputs used to measure fair value for major categories of investments.

•

Equity securities — Equities (including common and preferred shares, domestic listed and foreign listed, closed end mutual funds and exchange traded funds) are generally valued at the closing price reported on the major market on which the individual securities are traded at the measurement date. Equity securities held by the Company that are publicly traded in active markets are classified within Level 1 of the fair value hierarchy. Those equities that are held in proprietary funds pooled with other investor accounts measured at fair value using the NAV per share practical expedient are not classified in the fair value hierarchy.


•	Fixed income — United States government securities are generally valued using quoted prices of securities with similar characteristics. Corporate bonds and notes are generally valued by using pricing models (e.g.

discounted cash flows), quoted prices of securities with similar characteristics or broker quotes. Fixed income securities listed on active markets are classified in Level 1. Fixed income held in proprietary funds pooled with other investor accounts measured at fair value using the NAV per share practical expedient are not classified in the fair value hierarchy. Hedging instruments are collateralized daily with either cash or government bonds, have daily liquidity and pricing based on observable inputs from over-the-counter markets, and are classified as Level 2.

•

Hedge funds — Hedge funds are pooled funds that employ a range of investment strategies including equity and fixed income, credit driven, macro and multi-oriented strategies. The valuation of limited partnership interests in hedge funds may require significant management judgment. Generally, hedge funds are valued using the NAV reported by the asset manager, and are adjusted when it is determined that NAV is not representative of fair value. In making such an assessment, a variety of factors is reviewed, including, but not limited to, the timeliness of NAV as reported by the asset manager and changes in general economic and market conditions subsequent to the last NAV reported by the asset manager. All of the hedge funds held have lockups and/or gates. Hedge funds have unfunded commitments of $0 million and $0 million at December 31, 2019 and 2018, respectively.

•

Private equity — Private equity includes a diversified range of strategies, including buyout funds, distressed funds, venture and growth equity funds and mezzanine funds with long-term commitments, and redemptions beginning no earlier than 2019. The valuation of limited partnership interests in private equity funds may require significant management judgment. Generally, private equity is valued using the NAV reported by the asset manager, and is adjusted when it is determined that NAV is not representative of fair value. In making such an assessment, a variety of factors is reviewed, including, but not limited to, the timeliness of NAV as reported by the asset manager and changes in general economic and market conditions subsequent to the last NAV reported by the asset manager. Private equity is not liquid and has unfunded commitments of $0 million and $3 million at December 31, 2019 and 2018, respectively.

•

Cash, insurance contracts and other — Primarily comprised of insurance contracts and cash. Insurance contracts are valued at contract value, which approximates fair value, and is calculated using the prior year balance adjusted for investment returns and cash flows and are generally classified as Level 3. Insurance contracts are held by certain foreign pension plans. Cash and cash equivalents are held in accounts with brokers or custodians for liquidity and investment collateral and are classified as Level 1.

The following table provides the fair value of plan assets held by our pension benefit plans by asset class:



	2019										2018
(in millions)	Level 1		Level 2		Level 3		NAV Practical Expedient		Total		Level 1		Level 2		Level 3		NAV Practical Expedient		Total
Equity securities
Global stock funds/securities	$	90	$	—	$	—	$	13	$	103	$	88	$	—	$	—	$	29	$	117
Index funds	—		—		—		—		—		—		—		—		1		1
Diversified Growth and Income Funds	—		—		—		9		9		—		—		—		51		51
Fixed income
Corporate bonds	86		—		—		5		91		34		—		—		25		59
Government bonds	35		—		—		27		62		31		—		—		20		51
Hedging Instruments	4		35		—		—		39		5		22		—		—		27
Diversified Growth and Income Funds	—		—		—		—		—		—		—		—		2		2
Hedge funds	—		—		—		12		12		—		—		—		67		67
Private equity	—		—		—		—		—		—		—		—		6		6
Insurance contracts and other			—		13		3		16		104		—		12		70		186
Cash & Cash Equivalents	273		—		—		—		273		—		—		—		—		—
Total plan assets subject to leveling	$	488	$	35	$	13	$	69	$	605	$	262	$	22	$	12	$	271	$	567

The following table presents a reconciliation of the beginning and ending balances of fair value measurement within our pension plans using significant unobservable inputs (Level 3):



(in millions)	Insurance Contracts and Other
Balance, December 31, 2017	$	17
Purchases, sales, settlements	(5		)
Currency impact	—
Balance, December 31, 2018	$	12
Purchases, sales, settlements	1
Currency impact	—
Balance, December 31, 2019	$	13

Contributions and Estimated Future Benefit Payments

Funding requirements under governmental regulations are a major consideration in making contributions to our postretirement plans. We made contributions of $19 million and $41 million to our pension and postretirement defined benefit plans during 2019 and 2018, respectively. A discretionary contribution was made to the U.S. Plan in the third quarter of 2018 for $19 million to increase the funding ratio and reduce regulatory fees. We currently anticipate making contributions to our pension and postretirement defined benefit plans in the range of $15 million to $25 million during 2020, of which approximately $5 million is expected to be made in the first quarter.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid as follows:



(in millions)	Pension		Other Benefits
2020	$	37	$	3
2021	36		3
2022	37		3
2023	38		3
2024	39		3
Years 2025 - 2029	208		16

Stock-Based Compensation

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation Plans

Our stock-based compensation program is a broad-based program designed to attract and retain employees while also aligning employees’ interests with the interests of our shareholders. In addition, members of our Board of Directors participate in our stock-based compensation program in connection with their service on our board. Share-based awards issued to employees include non-qualified stock options, restricted stock unit awards and performance share unit awards. Under the 2011 Omnibus Incentive Plan, the number of shares initially available for awards was 18 million. As of December 31, 2019, there were approximately 6 million shares of common stock available for future grants.

Total share-based compensation costs recognized for 2019, 2018 and 2017 were $29 million, $30 million, and $21 million, respectively. The unamortized compensation expense at December 31, 2019 related to our stock options, restricted share units and performance share units was $6 million, $22 million and $10 million, respectively, and is expected to be recognized over a weighted average period of 1.8, 1.8 and 1.3 years, respectively.

The amount of cash received from the exercise of stock options was $13 million for 2019 with a tax benefit of $13 million realized associated with stock option exercises and vesting of restricted stock units. We classify as an operating activity the cash flows attributable to excess tax benefits arising from stock option exercises and restricted stock unit vestings.

Stock Option Grants

Options are awarded with a contractual term of ten years and generally vest over a three-year period and are exercisable within the contractual term, except in certain instances of death, retirement or disability. The exercise price per share is the fair market value of the underlying common stock on the date each option is granted. At December 31, 2019, there were options to purchase an aggregate of 2.0 million shares of common stock. The following is a summary of the changes in outstanding stock options for 2019:



	Share units (in thousands)		Weighted Average Exercise Price / Share		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding at January 1, 2019	2,125		$	43.08	6.5
Granted	334		$	74.08
Exercised	(348	)	$	35.56
Forfeited and expired	(71	)	$	67.97
Outstanding at December 31, 2019	2,040		$	48.56	6.3	$	62
Options exercisable at December 31, 2019	1,432		$	39.83	5.3	$	56
Vested and non-vested expected to vest as of December 31, 2019	1,996		$	48.00	6.2	$	61

The amount of non-vested options outstanding was 0.6 million, 0.7 million and 0.9 million at a weighted average fair value of $69.30, $58.00 and $42.84 as of December 31, 2019, 2018 and 2017, respectively. The total intrinsic value of options exercised (which is the amount by which the stock price exceeded the exercise price of the options on the date of exercise) during 2019, 2018 and 2017 was $15 million, $9 million and $14 million, respectively.

The fair value of each option grant was estimated on the date of grant using the binomial lattice pricing model which incorporates multiple and variable assumptions over time, including assumptions such as employee exercise patterns, stock price volatility and changes in dividends. The following are weighted-average assumptions used for 2019, 2018, and 2017:



	2019			2018			2017
Dividend yield	1.30		%	1.12		%	1.49		%
Volatility	24.10		%	23.41		%	25.39		%
Risk-free interest rate	2.55		%	2.76		%	2.07		%
Expected term (in years)	5.4			5.1			5.1
Weighted-average fair value per option	$	17.04		$	17.80		$	10.66

Expected volatility is calculated based on a weighted analysis of historic and implied volatility measures for a set of peer companies and Xylem. We use historical data to estimate option exercise and employee termination behavior within the valuation model. Employee groups and option characteristics are considered separately for valuation purposes. The expected term represents an estimate of the period of time options are expected to remain outstanding. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of option grant.

Restricted Stock Unit Grants

Restricted shares granted to employees in 2019, 2018 and 2017 vest over a three-year period. Restricted shares granted to employees prior to 2017 generally become fully vested upon the third anniversary of the date of grant. Prior to the time a restricted share becomes fully vested, the awardees cannot transfer, pledge, hypothecate or encumber such shares. Prior to the time a restricted share is fully vested, the awardees do not have certain rights of a stockholder, such as the right to vote and receive dividends; however, dividends accrue during the vesting period and are paid upon vesting. If an employee leaves prior to vesting, whether through resignation or termination for cause, the restricted stock unit and related accrued dividends are forfeited. If an employee retires, a pro rata portion of the restricted stock unit may vest in accordance with the terms of the grant agreements. Restricted stock units granted to Board members become fully vested upon the day prior to the next annual meeting. The fair value of the restricted share unit awards is determined using the closing price of our common stock on date of grant.

Our restricted stock units activity was as follows for 2019:



	Share Units (in thousands)		Weighted Average Grant Date Fair Value / Share
Outstanding at January 1, 2019	537		$	59.41
Granted	287		74.36
Vested	(257	)	55.09
Forfeited	(55	)	67.80
Outstanding at December 31, 2019	512		68.95

Performance Share Units

Performance share units granted under the long-term incentive plan vest based upon performance by the Company over a three-year period against targets approved by the Compensation Committee of the Company's Board of Directors prior to the grant date. For the performance periods, the performance share units were granted at a target of 100% with actual payout contingent upon the achievement of a pre-set, three-year adjusted Return on Invested Capital and cumulative adjusted net income performance target for ROIC performance share units and a relative TSR performance for TSR performance share units. The calculated compensation cost for ROIC performance share units is adjusted based on an estimate of awards ultimately expected to vest and our assessment of the probable outcome of the performance condition.

ROIC Performance Share Unit Grants

The fair value of the ROIC performance share unit awards is determined using the closing price of our common stock on date of grant.

Our ROIC performance share unit activity was as follows for 2019:



	Share units (in thousands)		Weighted Average Grant Date Fair Value / Share
Outstanding at January 1, 2019	274		$	52.11
Granted	77		74.07
Adjustment for Performance Condition Achieved (a)	74		37.86
Vested	(174	)	37.86
Forfeited	(26	)	63.89
Outstanding at December 31, 2019	225		64.51

(a) Represents an increase in the number of original ROIC performance share units awarded based on the final performance criteria achievement at the end of the performance period of such awards.

TSR Performance Share Unit Grants

The following is a summary of our TSR performance share unit grants for 2019:



	Share units (in thousands)		Weighted Average Grant Date Fair Value / Share
Outstanding at January 1, 2019	274		$	61.04
Granted	77		89.62
Adjustment for Performance Condition Achieved (a)	74		37.86
Vested	(174	)	37.86
Forfeited	(26	)	63.89
Outstanding at December 31, 2019	225		75.80

(a) Represents an increase in the number of original TSR performance share units awarded based on the final market condition achievement at the end of the performance period of such awards.

The fair value of TSR performance share units were calculated on the date of grant using a Monte Carlo simulation model utilizing several key assumptions, including expected Company and peer company share price volatility, correlation coefficients between peers, the risk-free rate of return, the expected dividend yield and other award design features. The following are weighted-average key assumptions for 2019 grants.



Volatility	20.90	%
Risk-free interest rate	2.52	%

Capital Stock

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Capital Stock

The Company has the authority to issue an aggregate of 750 million shares of common stock having a par value of $0.01 per share. The stockholders of Xylem common stock are entitled to receive dividends as declared by the Xylem Board of Directors. Dividends declared were $0.96, $0.84 and $0.72 during 2019, 2018 and 2017, respectively.

The changes in shares of common stock outstanding for the three years ended December 31 are as follows:



(share units in thousands)	2019		2018		2017
Beginning Balance, January 1	179,724		179,862		179,367
Stock incentive plan net activity	952		672		985
Repurchase of common stock	(536	)	(810	)	(490	)
Ending Balance, December 31	180,140		179,724		179,862

For the years ended December 31, 2019 and December 31, 2018 the Company repurchased 0.5 million shares of common stock for $40 million and repurchased 0.8 million shares of common stock for $59 million, respectively. Repurchases include both share repurchase programs approved by the Board of Directors and repurchases in relation to settlement of employee income tax withholding obligations due as a result of the vesting of restricted stock units. The detail of repurchases by each program are as follows:

On August 24, 2015, our Board of Directors authorized the repurchase of up to $500 million in shares with no expiration date. The program's objective is to deploy our capital in a manner that benefits our shareholders and maintains our focus on growth. For the year ended December 31, 2019 we repurchased 0.3 million shares for $25 million. For the year ended December 31, 2018 we repurchased 0.7 million shares for $50 million. There are up to $338 million in shares that may still be purchased under this plan as of December 31, 2019.

On August 18, 2012, the Board of Directors authorized the repurchase of up to 2.0 million shares of common stock with no expiration date. The program's objective is to offset dilution associated with various Xylem employee stock plans by acquiring shares in the open market from time to time. For the year ended December 31, 2017 we repurchased 0.3 million shares for $13 million. As of June 2017, we have exhausted the authorized amount to repurchase shares under this plan.

Aside from the aforementioned repurchase programs, we repurchased 0.2 million and 0.1 million shares for $15 million and $9 million during 2019 and 2018, respectively, in relation to settlement of employee income tax withholding obligations due as a result of the vesting of restricted stock units. These repurchases are included in the stock incentive plan net activity in the above table.

Accumulated Other Comprehensive Loss

12 Months Ended

Dec. 31, 2019

Accumulated Other Comprehensive Income [Abstract]

Accumulated Other Comprehensive Loss

The following table provides the components of accumulated other comprehensive loss for 2019, 2018 and 2017:



(in millions)	Foreign Currency Translation			Postretirement Benefit Plans			Derivative Instruments			Total
Balance at January 1, 2017	$	(140	)	$	(177	)	$	(1	)	$	(318	)
Foreign currency translation adjustment	79									79
Income tax impact on foreign currency translation adjustment	46									46
Changes in postretirement benefit plans				(18		)				(18		)
Income tax expense on changes in postretirement benefit plans				7						7
Foreign currency translation adjustment for postretirement benefit plans				(18		)				(18		)
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net				11						11
Income tax impact on amortization of postretirement benefit plan items				(3		)				(3		)
Unrealized loss on derivative hedge agreements							9			9
Reclassification of unrealized (gain) loss on foreign exchange agreements into revenue							(6		)	(6		)
Reclassification of unrealized (gain) loss on foreign exchange agreements into cost of revenue	—						1			1
Balance at December 31, 2017	$	(15	)	$	(198	)	$	3		$	(210	)



(in millions)	Foreign Currency Translation			Postretirement Benefit Plans			Derivative Instruments			Total
Cumulative effect of change in accounting principle	(11		)	(6		)				(17		)
Foreign currency translation adjustment	(83		)							(83		)
Income tax impact on foreign currency translation adjustment	(12		)							(12		)
Changes in postretirement benefit plans				(36		)				(36		)
Foreign currency translation adjustment for postretirement benefit plans				15						15
Income tax expense on changes in postretirement benefit plans				5						5
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net				9						9
Income tax impact on amortization of postretirement benefit plan items				(3		)				(3		)
Unrealized loss on derivative hedge agreements							(8		)	(8		)
Reclassification of unrealized (gain) loss on foreign exchange agreements into cost of revenue							4			4
Balance at December 31, 2018	$	(121	)	$	(214	)	$	(1	)	$	(336	)
Foreign currency translation adjustment	27									27
Income tax impact on foreign currency translation adjustment	(9		)	—						(9		)
Changes in postretirement benefit plans				(83		)				(83		)
Settlement charge released into other non-operating income (expense), net				9						9
Foreign currency translation adjustment for postretirement benefit plans				(3		)				(3		)
Income tax expense on changes in postretirement benefit plans, including settlement				16						16
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net				8						8
Income tax impact on amortization of postretirement benefit plan items				(2		)				(2		)
Unrealized loss on derivative hedge agreements							(14		)	(14		)
Reclassification of unrealized loss on foreign exchange agreements into revenue							7			7
Reclassification of unrealized loss on foreign exchange agreements into cost of revenue							5			5
Balance at December 31, 2019	$	(103	)	$	(269	)	$	(3	)	$	(375	)

Commitments and Contingencies

12 Months Ended

Dec. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Legal Proceedings

From time to time we are involved in legal and regulatory proceedings that are incidental to the operation of our businesses (or the business operations of previously-owned entities). These proceedings may seek remedies relating to environmental matters, tax, intellectual property matters, acquisitions or divestitures, product liability and personal injury claims, privacy, employment, labor and pension matters, government contract issues and commercial or contractual disputes.

From time to time, claims may be asserted against Xylem alleging injury caused by any of our products resulting from asbestos exposure. We believe there are numerous legal defenses available for such claims and would defend ourselves vigorously. Pursuant to the Distribution Agreement among ITT Corporation (now ITT LLC), Exelis and Xylem, ITT Corporation (now ITT LLC) has an obligation to indemnify, defend and hold Xylem harmless for asbestos product liability matters, including settlements, judgments, and legal defense costs associated with all pending and future claims that may arise from past sales of ITT’s legacy products. We believe ITT Corporation (now ITT LLC) remains a substantial entity with sufficient financial resources to honor its obligations to us.

See Note 7 "Income Taxes" of our Consolidated Financial Statements for a description of a pending tax litigation matter.

Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including our assessment of the merits of the particular claims, we do not believe it is reasonably possible that any asserted or unasserted legal claims or proceedings, individually or in aggregate, will have a material adverse effect on our results of operations, or financial condition.

We have estimated and accrued $5 million and $7 million as of December 31, 2019 and 2018, respectively, for these general legal matters.

Indemnifications

As part of our 2011 spin-off from our former parent, ITT Corporation (now ITT LLC), Exelis Inc. and Xylem will indemnify, defend and hold harmless each of the other parties with respect to such parties’ assumed or retained liabilities under the Distribution Agreement and breaches of the Distribution Agreement or related spin agreements. The former parent’s indemnification obligations include asserted and unasserted asbestos and silica liability claims that relate to the presence or alleged presence of asbestos or silica in products manufactured, repaired or sold prior to October 31, 2011, the Distribution Date, subject to limited exceptions with respect to certain employee claims, or in the structure or material of any building or facility, subject to exceptions with respect to employee claims relating to Xylem buildings or facilities. The indemnification associated with pending and future asbestos claims does not expire. Xylem has not recorded a liability for material matters for which we expect to be indemnified by the former parent or Exelis Inc. through the Distribution Agreement and we are not aware of any claims or other circumstances that would give rise to material payments from us under such indemnifications. On May 29, 2015, Harris Inc. acquired Exelis. As the parent of Exelis, Harris Inc. is responsible for Exelis’ indemnification obligations under the Distribution Agreement.

Guarantees

We obtain certain stand-by letters of credit, bank guarantees, surety bonds and insurance letters of credit from third-party financial institutions in the ordinary course of business when required under contracts or to satisfy insurance related requirements. As of December 31, 2019 and December 31, 2018, the amount of surety bonds, bank guarantees, stand-by letters of credit, and insurance letters of credit was $340 million and $275 million, respectively.

Environmental

In the ordinary course of business, we are subject to federal, state, local, and foreign environmental laws and regulations. We are responsible, or are alleged to be responsible, for ongoing environmental investigation and remediation of sites in various countries. These sites are in various stages of investigation and/or remediation and in many of these proceedings our liability is considered de minimis. We have received notification from the United States Environmental Protection Agency, and from similar state and foreign environmental agencies, that a number of sites formerly or currently owned and/or operated by Xylem or for which we are responsible under the Distribution Agreement, and other properties or water supplies that may be or have been impacted from those operations, contain disposed or recycled materials or wastes and require environmental investigation and/or remediation. These sites include instances where we have been identified as a potentially responsible party under federal and state environmental laws and regulations.

Accruals for environmental matters are recorded on a site-by-site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies. Our accrued liabilities for these environmental matters represent our best estimates related to the investigation and remediation of environmental media such as water, soil, soil vapor, air and structures, as well as related legal fees. These estimates, and related accruals, are reviewed quarterly and updated for progress of investigation and remediation efforts and changes in facts and legal circumstances. Liabilities for these environmental expenditures are recorded on an undiscounted basis. We have estimated and accrued $3 million and $4 million as of December 31, 2019 and 2018, respectively, for environmental matters.

It is difficult to estimate the final costs of investigation and remediation due to various factors, including incomplete information regarding particular sites and other potentially responsible parties, uncertainty regarding the extent of investigation or remediation and our share, if any, of liability for such conditions, the selection of alternative remedial approaches, and changes in environmental standards and regulatory requirements. We believe the total amount accrued is reasonable based on existing facts and circumstances.

Warranties

We warrant numerous products, the terms of which vary widely. In general, we warrant products against defect and specific non-performance. Warranty expense was $25 million, $20 million, and $28 million for 2019, 2018 and 2017, respectively. The table below provides changes in the combined current and non-current product warranty accruals over each period.



(in millions)	2019			2018			2017
Warranty accrual – January 1	$	60		$	82		$	99
Net charges for product warranties in the period	25			20			28
Settlement of warranty claims	(42		)	(42		)	(48		)
Foreign currency and other	(2		)	—			3
Warranty accrual – December 31	$	41		$	60		$	82

Related Party Transactions

12 Months Ended

Dec. 31, 2019

Related Party Transactions

Sales to and purchases from unconsolidated entities for 2019, 2018 and 2017 are as follows:



(in millions)	2019		2018		2017
Sales to unconsolidated affiliates	$	10	$	10	$	12
Purchases from unconsolidated affiliates	22		22		17

Segment and Geographic Data

12 Months Ended

Dec. 31, 2019

Segment Reporting Information [Line Items]

Segment and Geographic Data

Our business has three reportable segments: Water Infrastructure, Applied Water and Measurement & Control Solutions. When determining the reportable segments, the Company aggregated operating segments based on their similar economic and operating characteristics. The Water Infrastructure segment focuses on the transportation and treatment of water, offering a range of products including water, wastewater and storm water pumps, treatment equipment, and controls and systems. The Applied Water segment serves many of the primary uses of water and focuses on the residential, commercial and industrial markets. The Applied Water segment's major products include pumps, valves, heat exchangers, controls and dispensing equipment. The Measurement & Control Solutions segment focuses on developing advanced technology solutions that enable intelligent use and conservation of critical water and energy resources as well as analytical instrumentation used in the testing of water. The Measurement & Control Solutions segment's major products include smart metering, networked communications, measurement and control technologies, critical infrastructure technologies, software and services including cloud-based analytics, remote monitoring and data management, leak detection and pressure monitoring solutions and testing equipment.

Additionally, we have Regional selling locations, which consist primarily of selling and marketing organizations and related support services, that offer products and services across our reportable segments. Corporate and other consists of corporate office expenses including compensation, benefits, occupancy, depreciation, and other administrative costs, as well as charges related to certain matters, such as environmental matters, that are managed at a corporate level and are not included in the business segments in evaluating performance or allocating resources.

The accounting policies of each segment are the same as those described in the summary of significant accounting policies (see Note 1, "Summary of Significant Accounting Policies"). The following tables contain financial information for each reportable segment:



	Year Ended December 31,
(in millions)	2019			2018			2017
Revenue:
Water Infrastructure	$	2,177		$	2,176		$	2,004
Applied Water	1,541			1,534			1,421
Measurement & Control Solutions	1,531			1,497			1,282
Total	$	5,249		$	5,207		$	4,707
Operating income:
Water Infrastructure	$	365		$	359		$	312
Applied Water	241			236			194
Measurement & Control Solutions	(67		)	118			110
Corporate and other	(53		)	(59		)	(64		)
Total operating income	486			654			552
Interest expense	67			82			82
Other non-operating (expense) income, net	(4		)	13			6
Gain (loss) on sale of businesses	1			—			(10		)
Income before taxes	$	416		$	585		$	466
Depreciation and amortization:
Water Infrastructure	$	61		$	66		$	64
Applied Water	24			22			23
Measurement & Control Solutions	144			144			122
Regional selling locations (a)	18			20			17
Corporate and other	10			9			8
Total	$	257		$	261		$	234
Capital expenditures:
Water Infrastructure	$	79		$	84		$	58
Applied Water	19			28			20
Measurement & Control Solutions	100			101			69
Regional selling locations (b)	19			16			18
Corporate and other	9			8			5
Total	$	226		$	237		$	170


(a)	Depreciation and amortization expense incurred by the Regional selling locations was included in an overall allocation of Regional selling location costs to the segments; however, a certain portion of that expense was not specifically identified to a segment. That expense is captured in this Regional selling location line.


(b)	Represents capital expenditures incurred by the Regional selling locations not allocated to the segments.

The following table illustrates revenue by product category, net of intercompany revenue:



	Year Ended December 31,
(in millions)	2019		2018		2017
Pumps, accessories, parts and service	$	3,324	$	3,322	$	2,998
Other (a)	1,925		1,885		1,709
Total	$	5,249	$	5,207	$	4,707


(a)	Other includes treatment equipment, analytical instrumentation, heat exchangers, valves, controls and smart meters.

The following table contains the total assets for each reportable segment as of December 31, 2019, 2018 and 2017:



	Total Assets
(in millions)	2019		2018		2017
Water Infrastructure	$	1,268	$	1,233	$	1,232
Applied Water	1,016		1,051		1,002
Measurement & Control Solutions	3,497		3,576		3,198
Regional selling locations (a)	1,375		1,181		1,119
Corporate and other (b)	554		181		309
Total	$	7,710	$	7,222	$	6,860


(a)	The Regional selling locations have assets that consist primarily of cash, accounts receivable and inventory which are not allocated to the segments.


(b)	Corporate and other consists of items pertaining to our corporate headquarters function, which principally consist of cash, deferred tax assets, pension assets and certain plant and equipment.

Geographical Information

Revenue is attributed to countries based upon the location of the customer. Property, Plant & Equipment is attributed to countries based upon the location of the assets:



	Revenue
	Year Ended December 31,
(in millions)	2019		2018		2017
United States	$	2,554	$	2,424	$	2,161
Europe	1,380		1,449		1,335
Asia Pacific	659		660		611
Other	656		674		600
Total	$	5,249	$	5,207	$	4,707



	Property, Plant & Equipment
	December 31,
(in millions)	2019		2018		2017
United States	$	274	$	281	$	258
Europe	249		250		259
Asia Pacific	67		66		85
Other	68		59		41
Total	$	658	$	656	$	643

Valuation and Qualifying Accounts

12 Months Ended

Dec. 31, 2019

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

Valuation and Qualifying Accounts

The table below provides changes in the allowance for doubtful accounts over each period:



(in millions)	2019			2018			2017
Balance at beginning of year	$	25		$	25		$	21
Additions charged to expense	3			5			5
Deductions/other	(3		)	(5		)	(1		)
Balance at end of year	$	25		$	25		$	25

Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (Unaudited)

Our quarterly financial periods end on the Saturday closest to the last day of the calendar quarter, except

for the fourth quarter which ends on December 31.



	2019 Quarter Ended
(in millions, except per share amounts)	Dec. 31		Sept. 30		June 30		Mar. 31
Revenue	$	1,371	$	1,296	$	1,345	$	1,237
Gross profit	537		509		526		474
Operating income	195		11		171		109
Net income attributable to Xylem	$	118	$	65	$	139	$	79
Earnings per share:
Basic	$	0.66	$	0.36	$	0.77	$	0.44
Diluted	$	0.65	$	0.36	$	0.77	$	0.43



	2018 Quarter Ended
(in millions, except per share amounts)	Dec. 31		Sept. 30		June 30		Mar. 31
Revenue	$	1,386	$	1,287	$	1,317	$	1,217
Gross profit	542		505		519		460
Operating income	194		176		171		113
Net income attributable to Xylem	$	225	$	130	$	115	$	79
Earnings per share:
Basic	$	1.25	$	0.73	$	0.64	$	0.44
Diluted	$	1.24	$	0.72	$	0.64	$	0.43

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Foreign Currency Translation

Basis of Presentation

Use of Estimates

Consolidation Principles

Revenue Recognition

Shipping and Handling Costs

Shipping and handling costs are recorded as a component of cost of revenue.

Share-Based Compensation

Research and Development

Exit and Disposal Costs

Deferred Financing Costs

Income Taxes

Earnings Per Share

Cash Equivalents

We consider all liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Receivables and Allowance for Doubtful Accounts and Discounts

Receivables primarily comprise uncollected amounts owed to us from transactions with customers and are presented net of allowances for doubtful accounts, returns and early payment discounts.

Inventories

Goodwill and Intangible Assets

These assets are recorded at historical cost and are depreciated using the straight-line method of depreciation over the estimated useful lives as follows:



	Estimated Life
Buildings and improvements	5 to 40 years
Machinery and equipment	2 to 10 years
Furniture and fixtures	3 to 7 years
Equipment held for lease or rental	2 to 10 years

Leases

Long-Lived Asset Impairment

Product Warranties

For service-type warranties (i.e. non-standard warranties) costs incurred to fulfill the extended or service warranty are recognized/recorded as the costs are incurred.

Postretirement Benefit Plans

We consider changes to a plan’s benefit formula that eliminate the accrual for future service but continue to allow for future salary increases (i.e. “soft freeze”) to be a curtailment.

Business Combinations

Derivative Financial Instruments

Commitments and Contingencies

Concentrations of Credit Risk

Fair Value Measurements


•	Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

•


•	Level 3 inputs are unobservable inputs for the assets or liabilities.

NAV Practical Expedient is the measurement of fair value using the net asset value ("NAV") per share (or its equivalent) as an alternative to the fair value hierarchy as discussed above.

Pronouncements Not Yet Adopted

Recently Adopted Pronouncements


(1)	Eliminates the concept of recognizing periodic hedge ineffectiveness for cash flow and net investment hedges;


(2)	Eliminates the benchmark interest rate concept of variable - rate instruments in cash flow hedges and allows companies to designate the contractually specified interest rate as the hedged risk;


(3)	Requires a company to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported; and


(4)	Provides the ability to perform subsequent hedge effectiveness tests qualitatively.

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2019

Purchase Price Allocation

These assets are recorded at historical cost and are depreciated using the straight-line method of depreciation over the estimated useful lives as follows:



	Estimated Life
Buildings and improvements	5 to 40 years
Machinery and equipment	2 to 10 years
Furniture and fixtures	3 to 7 years
Equipment held for lease or rental	2 to 10 years

The components of total property, plant and equipment, net are as follows:



	December 31,
(in millions)	2019		2018
Land, buildings and improvements	$	339	$	326
Machinery and equipment	861		819
Equipment held for lease or rental	256		249
Furniture and fixtures	118		109
Construction work in progress	104		107
Other	24		22
Total property, plant and equipment, gross	1,702		1,632
Less accumulated depreciation	1,044		976
Total property, plant and equipment, net	$	658	$	656

Acquisitions and Divestitures (Tables)

12 Months Ended

Dec. 31, 2019

Business Combinations [Abstract]

The Pure purchase price allocation as of January 31, 2018 is shown in the following table:



(in millions)	Amount
Cash	$	14
Receivables	23
Inventories	4
Prepaid and other current assets	2
Property, plant and equipment	22
Intangible assets	149
Other long-term assets	1
Accounts payable	(3		)
Accrued and other current liabilities	(12		)
Deferred income tax liabilities	(25		)
Other non-current accrued liabilities	(2		)
Total identifiable net assets	173

Goodwill	261
Total consideration	$	434

Summary of Intangible Assets Acquired

The following table summarizes key information underlying identifiable intangible assets related to the Pure acquisition:



Category	Life	Amount (in millions)
Customer Relationships	17 - 18 years	$	84
Technology	3 - 10 years	38
Tradenames	20 years	21
Internally Developed Software	3 years	6
Total		$	149

Pro Forma Information



(in millions)	Year Ended December 31,
	2018	2017
Revenue	$5,212	$4,809
Net income	$546	$323

Restructuring and Asset Impairment Charges (Tables)

12 Months Ended

Dec. 31, 2019

Restructuring and Related Activities [Abstract]

Components of restructuring and asset impairment charges

components of restructuring expense and asset impairment charges incurred during each of the previous three years:



	Year Ended December 31,
(in millions)	2019			2018			2017
By component:
Severance and other charges	$	51		$	19		$	20
Lease related charges	1			1			—
Other restructuring charges	2			1			2
Reversal of restructuring accruals	(1		)	(1		)	(2		)
Total restructuring charges	53			20			20
Asset impairment charges	10			2			5
Total restructuring and asset impairment charges	$	63		$	22		$	25

By segment:
Water Infrastructure	$	20		$	11		$	7
Applied Water	5			2			13
Measurement & Control Solutions	38			9			5
Corporate and other	—			—			—

Revenue from Contract with Customer [Abstract]

The following table presents expected restructuring spend:



(in millions)	Water Infrastructure		Applied Water		Measurement & Control Solutions		Corporate		Total
Actions Commenced in 2019:
Total expected costs	$	19	$	5	$	28	$	—	$	52
Costs incurred during 2019	18		5		27		—		50
Total expected costs remaining	$	1	$	—	$	1	$	—	$	2

Actions Commenced in 2018:
Total expected costs	$	8	$	1	$	7	$	—	$	16
Costs incurred during 2018	7		1		7		—		15
Costs incurred during 2019	1		—		—		—		1
Total expected costs remaining	$	—	$	—	$	—	$	—	$	—

Actions Commenced in 2017:
Total expected costs	$	12	$	7	$	4	$	—	$	23
Costs incurred during 2017	5		4		2		—		11
Costs incurred during 2018	2		1		1		—		4
Costs incurred during 2019	1		—		1		—		2
Total expected costs remaining	$	4	$	2	$	—	$	—	$	6



(in millions)	2019			2018
Restructuring accruals - January 1	$	5		$	7
Restructuring charges	53			20
Cash payments	(30		)	(21		)
Foreign currency and other	(1		)	(1		)
Restructuring accruals - December 31	$	27		$	5

By segment:
Water Infrastructure	$	1		$	1
Applied Water	—			1
Measurement & Control Solutions	19			2
Regional selling locations (a)	7			1

(a)

Regional selling locations consist primarily of selling and marketing organizations that incurred restructuring expense which was allocated to the segments. The liabilities associated with restructuring expense were not allocated to the segments.

Revenue (Tables)

12 Months Ended

Dec. 31, 2019

Disaggregation of Revenue

The following table illustrates the sources of revenue:



	Year Ended December 31,
(in millions)	2019		2018
Revenue from contracts with customers	$	5,002	$	4,963
Lease Revenue	247		244
Total	$	5,249	$	5,207

The following table reflects revenue from contracts with customers by application:



	Year Ended December 31,
(in millions)	2019		2018
Water Infrastructure
Transport	$	1,533	$	1,535
Treatment	397		397

Applied Water
Building Services	848		828
Industrial Water	693		706

Measurement and Control Solutions
Water	768		692
Energy	337		338
Software as a Service/Other	99		123
Test	327		344

Total	$	5,002	$	4,963

The following table reflects revenue from contracts with customers by geographical region:



	Year Ended December 31,
(in millions)	2019		2018
Water Infrastructure
United States	$	593	$	539
Europe	729		758
Asia Pacific	358		344
Other	250		291

Applied Water
United States	816		797
Europe	362		386
Asia Pacific	164		153
Other	199		198

Measurement and Control Solutions
United States	972		913
Europe	257		273
Asia Pacific	118		144
Other	184		167

Total	$	5,002	$	4,963

Contract with Customer, Asset and Liability

The table below provides contract assets, contract liabilities, and significant changes in contract assets and liabilities.



(in millions)	Contract Assets (a)			Contract Liabilities
Balance at 1/1/2018	$	89		$	107
Additions, net	87			101
Revenue recognized from opening balance	—			(89		)
Billings	(76		)	—
Other	(4		)	(6		)
Balance at 1/1/2019	$	96		$	113
Additions, net	81			114
Revenue recognized from opening balance	—			(91		)
Billings	(80		)	—
Other	9			(1		)
Balance at 12/31/2019	$	106		$	135

(a)

Excludes receivable balances which are disclosed on the balance sheet

Other Non-Operating Income, Net (Tables)

12 Months Ended

Dec. 31, 2019

Other Income and Expenses [Abstract]

Components of Other Non-Operating Income, Net

The components of other non-operating income, net are as follows:



	Year Ended December 31,
(in millions)	2019			2018		2017
Interest income	$	5		$	4	$	3
Income from joint ventures	3			5		3
Other (expense) income – net	(12		)	4		—
Total other non-operating (expense) income, net	$	(4	)	$	13	$	6

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Source of pre-tax income and components of income tax expense

The source of pre-tax income and the components of income tax expense are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Income components:
Domestic	$	203		$	208		$	162
Foreign	213			377			304
Total pre-tax income	$	416		$	585		$	466
Income tax expense components:
Current:
Domestic – federal	$	39		$	9		$	109
Domestic – state and local	13			13			9
Foreign	40			61			51
Total Current	92			83			169
Deferred:
Domestic – federal	$	7		$	17		$	(29	)
Domestic – state and local	(1		)	5			10
Foreign	(83		)	(69		)	(14		)
Total Deferred	(77		)	(47		)	(33		)
Total income tax provision	$	15		$	36		$	136
Effective income tax rate	3.7		%	6.1		%	29.2		%

Schedule of effective income tax rate reconciliation

Reconciliations between taxes at the U.S. federal income tax rate and taxes at our effective income tax rate on earnings before income taxes are as follows:



	Year Ended December 31,
	2019		2018		2017
Tax provision at U.S. statutory rate	21.0	%	21.0	%	35.0	%
Increase (decrease) in tax rate resulting from:
State income taxes	2.7		2.3		1.6
Uncertain tax positions	0.4		2.6		1.6
Valuation allowance	1.2		(47.1	)	3.3
Tax exempt interest	(3.0	)	(1.4	)	(10.6	)
Foreign tax rate differential	0.7		2.9		(6.7	)
Impact of foreign earnings, net	1.6		(1.7	)	37.0
Tax incentives	(9.6	)	(6.2	)	(6.6	)
Intercompany sale of assets	—		35.5		—
Other – net	1.7		(0.3	)	(0.5	)
Rate change	(18.1	)	—		(22.9	)
Goodwill impairment	7.8		—		—
Federal R&D tax credit	(1.2	)	(0.8	)	(1.0	)
Stock compensation	(1.5	)	(0.7	)	(1.0	)
Effective income tax rate	3.7	%	6.1	%	29.2	%

Components of net deferred tax assets and liabilities

The following is a summary of the components of the net deferred tax assets and liabilities recognized in the Consolidated Balance Sheets:



	December 31,
(in millions)	2019			2018
Deferred tax assets:
Employee benefits	$	106		$	97
Accrued expenses	26			30
Loss and other tax credit carryforwards	240			279
Inventory	6			7
Lease Liabilities	57			—
Other	3			11
	438			424
Valuation allowance	(191		)	(234		)
Net deferred tax asset	$	247		$	190
Deferred tax liabilities:
Intangibles	$	160		$	247
Investment in foreign subsidiaries	7			8
Property, plant, and equipment	78			69
Lease right-of-use assets	57			—
Other	29			29
Total deferred tax liabilities	$	331		$	353

Reconciliation of Deferred Tax Asset Valuation Allowance

A reconciliation of the change in valuation allowance on deferred tax assets is as follows:



(in millions)	2019			2018			2017
Valuation allowance — January 1	$	234		$	350		$	311
Change in assessment (a)	(2		)	1			(28		)
Current year operations	2			(271		)	48
Foreign currency and other (b)	(43		)	154			19
Valuation allowance — December 31	$	191		$	234		$	350


(a)	Decrease in assessment in 2019 is primarily attributable to profitability of certain jurisdictions. Increase in assessment in 2018 is primarily attributable to loss positions in various jurisdictions.

(b)

Included in foreign currency and other in 2018 is an increase in net operating losses due to amended prior year tax returns for which a valuation allowance was recorded.

Deferred taxes classification

Deferred taxes are classified in the Consolidated Balance Sheets as follows:



	December 31,
(in millions)	2019			2018
Non-current assets	$	226		$	140
Non-current liabilities	(310		)	(303		)
Total net deferred tax liabilities	$	(84	)	$	(163	)

Tax attributes available to reduce future taxable income

Tax attributes available to reduce future taxable income begin to expire as follows:



(in millions)	December 31, 2019		First Year of Expiration
U.S. net operating loss	$	8	December 31, 2024
State net operating loss	98		December 31, 2020
State excess interest expense	9		Indefinitely
State tax credits	2		Indefinitely
Foreign net operating loss	1,018		December 31, 2020
Foreign tax credits	3		December 31, 2030

Reconciliation of the beginning and ending amount of unrecognized tax benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



(in millions)	2019			2018			2017
Unrecognized tax benefits — January 1	$	136		$	130		$	67
Current year tax positions	3			—			56
Prior year tax positions	(5		)	7			7
Acquisitions	—			—			—
Settlements	(5		)	(1		)	—
Unrecognized tax benefits — December 31	$	129		$	136		$	130

Earliest open tax years by major jurisdiction

The following table summarizes our earliest open tax years by major jurisdiction:



Jurisdiction		Earliest Open Year
Italy		2013
Luxembourg		2016
Sweden		2013
Germany		2009
United Kingdom		2013
United States		2016
Switzerland		2017

Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Basic and diluted net earnings per share

The following is a reconciliation of the shares used in calculating basic and diluted earnings per share.



	Year Ended December 31,
	2019		2018		2017
Net income attributable to Xylem (in millions)	$	401	$	549	$	331
Shares (in thousands):
Weighted average common shares outstanding	179,958		179,750		179,602
Add: Participating securities (a)	29		27		27
Weighted average common shares outstanding — Basic	179,987		179,777		179,629
Plus incremental shares from assumed conversions: (b)
Dilutive effect of stock options	803		876		712
Dilutive effect of restricted stock units and performance share units	406		479		516
Weighted average common shares outstanding — Diluted	181,196		181,132		180,857
Basic earnings per share	$	2.23	$	3.05	$	1.84
Diluted earnings per share	$	2.21	$	3.03	$	1.83


(a)	Restricted stock awards containing rights to non-forfeitable dividends that participate in undistributed earnings with common shareholders are considered participating securities for purposes of computing earnings per share.

(b)

Incremental shares from stock options and restricted stock



	Year Ended December 31,
(in thousands)	2019	2018	2017
Stock options	1,383	1,300	1,626
Restricted stock units	348	333	379
Performance share units	394	465	504

Inventories (Tables)

12 Months Ended

Dec. 31, 2019

Inventory Disclosure [Abstract]

Inventories

The components of total inventories are summarized as follows:



	December 31,
(in millions)	2019		2018
Finished goods	$	212	$	248
Work in process	47		45
Raw materials	280		302
Total inventories	$	539	$	595

Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Assets and Liabilities, Leases

These assets are recorded at historical cost and are depreciated using the straight-line method of depreciation over the estimated useful lives as follows:



	Estimated Life
Buildings and improvements	5 to 40 years
Machinery and equipment	2 to 10 years
Furniture and fixtures	3 to 7 years
Equipment held for lease or rental	2 to 10 years

The components of total property, plant and equipment, net are as follows:



	December 31,
(in millions)	2019		2018
Land, buildings and improvements	$	339	$	326
Machinery and equipment	861		819
Equipment held for lease or rental	256		249
Furniture and fixtures	118		109
Construction work in progress	104		107
Other	24		22
Total property, plant and equipment, gross	1,702		1,632
Less accumulated depreciation	1,044		976
Total property, plant and equipment, net	$	658	$	656

Leases (Tables)

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Lease, Cost

The components of our lease cost were as follows:



	Year Ended
(in millions)	December 31, 2019
Lease cost
Operating lease cost	$	76
Short-term lease cost	9
Variable lease cost	19
Total lease cost	$	104

The supplemental cash flow information related to leases are as follows:



	Year Ended
(in millions)	December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	73

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	33

Information relating to the lease term and discount rate are as follows:



	Year Ended
	December 31, 2019
Weighted-average remaining lease term (years)
Operating leases	6 Years

Weighted-average discount rate
Operating leases	2.7%

Lessee, Operating Lease, Liability, Maturity

As of December 31, 2019, the maturities of operating lease liabilities were as follows:



(in millions)
2020	$	65
2021	50
2022	37
2023	29
2024	21
Thereafter	62
Total lease payments	264
Less: Imputed interest	(21		)
Total	$	243

Schedule of Future Minimum Rental Payments for Operating Leases

Total rent expense for the two years ended December 31, 2018 was as follows:



(in millions)	Total
2018	81
2017	70

As of December 31, 2018, we were obligated to make minimum future rental payments under operating leases as follows:



(in millions)
2019	$	76
2020	61
2021	43
2022	33
2023	22
Thereafter	64
Total lease payments	299

Accrued and Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2019

Payables and Accruals [Abstract]

Accrued and Other Current Liabilities



	December 31,
(in millions)	2019		2018
Compensation and other employee-benefits	$	199	$	194
Customer-related liabilities	153		129
Accrued warranty costs	36		44
Lease liabilities	61		—
Accrued taxes	79		85
Other accrued liabilities	100		94
Total accrued and other current liabilities	$	628	$	546

Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in the carrying value of goodwill by operating segment

Changes in the carrying value of goodwill by reportable segment during the years ended December 31, 2019 and 2018 are as follows:



(in millions)	Water Infrastructure			Applied Water			Measurement & Control Solutions			Total
Balance as of December 31, 2017	$	667		$	526		$	1,575		$	2,768
Activity in 2018
Divested/acquired	—			—			279			279
Foreign currency and other	(14		)	(10		)	(47		)	(71		)
Balance as of December 31, 2018	$	653		$	516		$	1,807		$	2,976
Activity in 2019
Acquired	—			—			19			19
Impairment	—			—			(148		)	(148		)
Foreign currency and other	(2		)	(3		)	(3		)	(8		)
Balance as of December 31, 2019	$	651		$	513		$	1,675		$	2,839

Other Intangible Assets

Information regarding our other intangible assets is as follows:



(in millions)	December 31, 2019							December 31, 2018
	Carrying Amount		Accumulated Amortization			Net Intangibles		Carrying Amount		Accumulated Amortization			Net Intangibles
Customer and distributor relationships	$	945	$	(352	)	$	593	$	951	$	(286	)	$	665
Proprietary technology and patents	204		(111		)	93		198		(93		)	105
Trademarks	148		(52		)	96		148		(41		)	107
Software	428		(206		)	222		355		(164		)	191
Other	20		(16		)	4		24		(19		)	5
Indefinite-lived intangibles	166		—			166		159		—			159
Other intangibles	$	1,911	$	(737	)	$	1,174	$	1,835	$	(603	)	$	1,232

Estimated Amortization Expense

Estimated amortization expense for each of the five succeeding years is as follows:



(in millions)
2020	$	136
2021	124
2022	115
2023	108
2024	99

Credit Facilities and Long-Term Debt (Tables)

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Schedule of Credit Facilities and Long-Term Debt

Total debt outstanding is summarized as follows:



	December 31,
(in millions)	2019			2018
4.875% Senior Notes due 2021 (a)	$	600		$	600
2.250% Senior Notes due 2023 (a)	557			570
3.250% Senior Notes due 2026 (a)	500			500
4.375% Senior Notes due 2046 (a)	400			400
Commercial paper	276			—
Term loan	—			257
Debt issuance costs and unamortized discount (b)	(17		)	(19		)
Total debt	2,316			2,308
Less: short-term borrowings and current maturities of long-term debt	276			257
Total long-term debt	$	2,040		$	2,051

(a)

(b)

The debt issuance costs and unamortized discount is recognized as a reduction in the carrying value of the Senior Notes in the Consolidated Balance Sheets and is being amortized to interest expense in our Consolidated Income Statements over the expected remaining terms of the Senior Notes.

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

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Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
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+ Details

Derivative Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2019

Effect of derivative financial instruments

The table below presents the effect of our derivative financial instruments on the Consolidated Income Statements and Consolidated Statements of Comprehensive Income:



	Year Ended December 31,
(in millions)	2019			2018			2017
Derivatives in Cash Flow Hedges
Foreign Exchange Contracts
Amount of (loss) gain recognized in OCI (a)	$	(14	)	$	(8	)	$	9
Amount of loss (gain) reclassified from OCI into revenue (a)	7			—			(6		)
Amount of loss reclassified from OCI into cost of revenue (a)	5			4			1

Derivatives in Net Investment Hedges
Cross Currency Swaps
Amount of gain (loss) recognized in OCI (a)	$	22		$	22		$	(53	)
Amount income recognized in Interest Expense	16			2			—
Foreign Currency Denominated Debt
Amount of gain (loss) recognized in OCI (a)	$	13		$	27		$	(74	)

(a)

Effective portion

Schedule of Foreign Exchange Contracts, Statement of Financial Position

The fair values of our derivative contracts currently included in our hedging program were as follows:



	December 31,
(in millions)	2019			2018
Derivatives designated as hedging instruments
Assets
Cash Flow Hedges
Other current assets	$	—		$	3
Net Investment Hedges
Other non-current assets	4			—
Liabilities
Cash Flow Hedges
Other current liabilities	—			(1		)
Net Investment Hedges
Other non-current liabilities	(24		)	(46		)

The fair value of our long-term debt, due in 2023, designated as a net investment hedge was $591 million and $599 million as of December 31, 2019 and 2018, respectively.

Postretirement Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2019

Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block

Schedule of Net Benefit Costs

The components of net periodic benefit cost for other postretirement employee benefit plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Service cost	$	—		$	—		$	1
Interest cost	2			2			2
Amortization of prior service credit	(4		)	(4		)	(3		)
Amortization of net actuarial loss	2			2			2
Net periodic benefit cost	$	—		$	—		$	2

Schedule of Changes in Accumulated Postemployment Benefit Obligations

Other changes in benefit obligations recognized in other comprehensive loss, as they pertain to other postretirement employee benefit plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Net loss (gain)	$	(2	)	$	1		$	(5	)
Prior service credit	—			(3		)	(3		)
Amortization of prior service credit	4			4			3
Amortization of net actuarial loss	(2		)	(2		)	(2		)
Foreign Exchange/Other	—			—			(1		)
Losses (gains) recognized in other comprehensive loss	$	—		$	—		$	(8	)
Total losses (gains) recognized in comprehensive income	$	—		$	—		$	(6	)

Defined benefit contributions by employer

Matching obligations, the majority of which were funded in cash in connection with the plans, and other company contributions are as follows:



(in millions)	Defined Contribution
2019	$	49
2018	39
2017	38

Summary of amounts recorded within accumulated other comprehensive income

The following table provides a summary of the funded status of our postretirement plans, the presentation of such balances and a summary of amounts recorded within accumulated other comprehensive income:



(in millions)	December 31, 2019									December 31, 2018
	Pension			Other			Total			Pension			Other			Total
Fair value of plan assets	$	605		$	—		$	605		$	567		$	—		$	567
Projected benefit obligation	(959		)	(49		)	(1,008		)	(862		)	(52		)	(914		)
Funded status	$	(354	)	$	(49	)	$	(403	)	$	(295	)	$	(52	)	$	(347	)
Amounts recognized in the balance sheet
Other non-current assets	$	58		$	—		$	58		$	68		$	—		$	68
Accrued and other current liabilities	(13		)	(3		)	(16		)	(12		)	(3		)	(15		)
Accrued postretirement benefits	(399		)	(46		)	(445		)	(351		)	(49		)	(400		)
Net amount recognized	$	(354	)	$	(49	)	$	(403	)	$	(295	)	$	(52	)	$	(347	)
Accumulated other comprehensive income (loss):
Net actuarial losses	$	(330	)	$	(19	)	$	(349	)	$	(260	)	$	(24	)	$	(284	)
Prior service credit	(3		)	7			4			(4		)	12			8
Total	$	(333	)	$	(12	)	$	(345	)	$	(264	)	$	(12	)	$	(276	)

Summary of the funded status of postretirement plans



	Domestic Plans						International Plans
	December 31,						December 31,
(in millions)	2019			2018			2019			2018
Change in benefit obligation:
Benefit obligation at beginning of year	$	99		$	107		$	763		$	843
Service cost	3			3			9			9
Interest cost	4			4			19			19
Benefits paid	(7		)	(5		)	(28		)	(36		)
Actuarial loss (gain)	15			(10		)	104			(20		)
Plan amendments, settlements and curtailments	—			—			(23		)	3
Foreign currency translation/other	(1		)	—			2			(55		)
Benefit obligation at end of year	$	113		$	99		$	846		$	763
Change in plan assets:
Fair value of plan assets at beginning of year	$	97		84			$	470		$	544
Employer contributions	—			22			16			16
Actual return on plan assets	17			(4		)	52			(20		)
Benefits paid	(7		)	(5		)	(28		)	(36		)
Plan amendments, settlements and curtailments	—			—			(23		)	—
Foreign currency translation/other	(2		)	—			13			(34		)
Fair value of plan assets at end of year	$	105		$	97		$	500		$	470
Unfunded status of the plans	$	(8	)	$	(2	)	$	(346	)	$	(293	)

Accumulated benefit obligation and fair value of the plans' assets

For defined benefit pension plans in which the ABO was in excess of the fair value of the plans’ assets, the projected benefit obligation, ABO and fair value of the plans’ assets were as follows:



	December 31,
(in millions)	2019		2018
Projected benefit obligation	$	562	$	500
Accumulated benefit obligation	526		470
Fair value of plan assets	150		137

Weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost

The following table provides the weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost, as they pertain to our pension plans.



	2019				2018				2017
	U.S.		Int’l		U.S.		Int’l		U.S.		Int’l
Benefit Obligation Assumptions
Discount rate	3.25	%	1.80	%	4.50	%	2.60	%	3.75	%	2.43	%
Rate of future compensation increase	NM		2.94	%	NM		2.92	%	NM		2.93	%
Net Periodic Benefit Cost Assumptions
Discount rate	4.50	%	2.60	%	3.75	%	2.43	%	4.25	%	2.63	%
Expected long-term return on plan assets	7.75	%	6.96	%	8.00	%	7.23	%	8.00	%	7.20	%
Rate of future compensation increase	NM		2.92	%	NM		2.93	%	NM		2.76	%

Not meaningful. The pension benefits for future service for all the U.S. pension plans are based on years of service and not impacted by future compensation increases.

Actual plan returns



	2019		2018		2017
Expected long-term rate of return on plan assets	7.09	%	7.34	%	7.30	%
Actual rate of return (loss) on plan assets	12.59	%	(3.85	)%	5.70	%

Allocation of plan assets

The following table provides the actual asset allocations of plan assets as of December 31, 2019 and 2018, and the related asset target allocation ranges by asset category.



	2019		2018		Target Allocation Ranges
Equity securities	18.6	%	29.7	%	15-60%
Fixed income	31.7	%	24.5	%	10-50%
Hedge funds	2.0	%	11.8	%	0-40%
Private equity	—	%	1.1	%	0-30%
Cash, insurance contracts and other	47.7	%	32.9	%	0-60%

The following table provides the fair value of plan assets held by our pension benefit plans by asset class:



	2019										2018
(in millions)	Level 1		Level 2		Level 3		NAV Practical Expedient		Total		Level 1		Level 2		Level 3		NAV Practical Expedient		Total
Equity securities
Global stock funds/securities	$	90	$	—	$	—	$	13	$	103	$	88	$	—	$	—	$	29	$	117
Index funds	—		—		—		—		—		—		—		—		1		1
Diversified Growth and Income Funds	—		—		—		9		9		—		—		—		51		51
Fixed income
Corporate bonds	86		—		—		5		91		34		—		—		25		59
Government bonds	35		—		—		27		62		31		—		—		20		51
Hedging Instruments	4		35		—		—		39		5		22		—		—		27
Diversified Growth and Income Funds	—		—		—		—		—		—		—		—		2		2
Hedge funds	—		—		—		12		12		—		—		—		67		67
Private equity	—		—		—		—		—		—		—		—		6		6
Insurance contracts and other			—		13		3		16		104		—		12		70		186
Cash & Cash Equivalents	273		—		—		—		273		—		—		—		—		—
Total plan assets subject to leveling	$	488	$	35	$	13	$	69	$	605	$	262	$	22	$	12	$	271	$	567

Reconciliation of the beginning and ending balances of fair value measurements with pension plans using significant unobservable inputs (level 3)

The following table presents a reconciliation of the beginning and ending balances of fair value measurement within our pension plans using significant unobservable inputs (Level 3):



(in millions)	Insurance Contracts and Other
Balance, December 31, 2017	$	17
Purchases, sales, settlements	(5		)
Currency impact	—
Balance, December 31, 2018	$	12
Purchases, sales, settlements	1
Currency impact	—
Balance, December 31, 2019	$	13

Expected benefit payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid as follows:



(in millions)	Pension		Other Benefits
2020	$	37	$	3
2021	36		3
2022	37		3
2023	38		3
2024	39		3
Years 2025 - 2029	208		16

Other postretirement benefit plans

Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block

Projected benefit obligations

The following table provides a rollforward of the projected benefit obligation for the other postretirement employee benefit plans:



(in millions)	2019			2018
Change in benefit obligation:
Benefit obligation at beginning of year	$	52		$	55
Service cost	—			—
Interest cost	2			2
Benefits paid	(3		)	(3		)
Actuarial gain/(loss)	(2		)	1
Plan Amendment and other	—			(3		)
Benefit obligation at the end of year	$	49		$	52

Pension

Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block

Schedule of Net Benefit Costs

The components of net periodic benefit cost for our defined benefit pension plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Domestic defined benefit pension plans:
Service cost	$	3		$	3		$	3
Interest cost	4			4			4
Expected return on plan assets	(8		)	(7		)	(6		)
Amortization of net actuarial loss	1			2			2
Net periodic benefit cost	$	—		$	2		$	3
International defined benefit pension plans:
Service cost	$	9		$	9		$	12
Interest cost	19			19			21
Expected return on plan assets	(27		)	(35		)	(34		)
Amortization of net actuarial loss	9			9			9
Settlement	9			1			1
Net periodic benefit cost	$	19		$	3		$	9
Total net periodic benefit cost	$	19		$	5		$	12

Components of net periodic benefit cost and other amounts recognized in other comprehensive income

Other changes in plan assets and benefit obligations recognized in other comprehensive loss, as they pertain to our defined benefit pension plans are as follows:



	Year Ended December 31,
(in millions)	2019			2018			2017
Domestic defined benefit pension plans:
Net (gain) loss	$	6		$	1		$	1
Prior service cost	—			—			1
Amortization of net actuarial loss	(1		)	(2		)	(2		)
(Gains) losses recognized in other comprehensive loss	$	5		$	(1	)	$	—
International defined benefit pension plans:
Net (gain) loss	$	79		$	35		$	23
Prior service credit	—			3			1
Amortization of net actuarial loss	(9		)	(9		)	(9		)
Settlement	(9		)	(1		)	(1		)
Foreign Exchange	3			(15		)	19
(Gains) losses recognized in other comprehensive loss	$	64		$	13		$	33
Total (gains) losses recognized in other comprehensive loss	$	69		$	12		$	33
Total (gains) losses recognized in comprehensive income	$	88		$	17		$	45

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Summary of the changes in outstanding stock options

The following is a summary of the changes in outstanding stock options for 2019:



	Share units (in thousands)		Weighted Average Exercise Price / Share		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding at January 1, 2019	2,125		$	43.08	6.5
Granted	334		$	74.08
Exercised	(348	)	$	35.56
Forfeited and expired	(71	)	$	67.97
Outstanding at December 31, 2019	2,040		$	48.56	6.3	$	62
Options exercisable at December 31, 2019	1,432		$	39.83	5.3	$	56
Vested and non-vested expected to vest as of December 31, 2019	1,996		$	48.00	6.2	$	61

Weighted-average assumptions

The following are weighted-average assumptions used for 2019, 2018, and 2017:



	2019			2018			2017
Dividend yield	1.30		%	1.12		%	1.49		%
Volatility	24.10		%	23.41		%	25.39		%
Risk-free interest rate	2.55		%	2.76		%	2.07		%
Expected term (in years)	5.4			5.1			5.1
Weighted-average fair value per option	$	17.04		$	17.80		$	10.66

Summary of restricted stock activity

Our restricted stock units activity was as follows for 2019:



	Share Units (in thousands)		Weighted Average Grant Date Fair Value / Share
Outstanding at January 1, 2019	537		$	59.41
Granted	287		74.36
Vested	(257	)	55.09
Forfeited	(55	)	67.80
Outstanding at December 31, 2019	512		68.95

Schedule of Share-based Compensation, Performance-Based Units Award Activity

Our ROIC performance share unit activity was as follows for 2019:



	Share units (in thousands)		Weighted Average Grant Date Fair Value / Share
Outstanding at January 1, 2019	274		$	52.11
Granted	77		74.07
Adjustment for Performance Condition Achieved (a)	74		37.86
Vested	(174	)	37.86
Forfeited	(26	)	63.89
Outstanding at December 31, 2019	225		64.51

(a) Represents an increase in the number of original ROIC performance share units awarded based on the final performance criteria achievement at the end of the performance period of such awards.

TSR Performance Share Unit Grants

The following is a summary of our TSR performance share unit grants for 2019:



	Share units (in thousands)		Weighted Average Grant Date Fair Value / Share
Outstanding at January 1, 2019	274		$	61.04
Granted	77		89.62
Adjustment for Performance Condition Achieved (a)	74		37.86
Vested	(174	)	37.86
Forfeited	(26	)	63.89
Outstanding at December 31, 2019	225		75.80

Fair value assumptions for performance-based awards

The following are weighted-average key assumptions for 2019 grants.



Volatility	20.90	%
Risk-free interest rate	2.52	%

Capital Stock (Tables)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Schedule of Common Stock Outstanding Roll Forward

The changes in shares of common stock outstanding for the three years ended December 31 are as follows:



(share units in thousands)	2019		2018		2017
Beginning Balance, January 1	179,724		179,862		179,367
Stock incentive plan net activity	952		672		985
Repurchase of common stock	(536	)	(810	)	(490	)
Ending Balance, December 31	180,140		179,724		179,862

Accumulated Other Comprehensive Loss (Tables)

12 Months Ended

Dec. 31, 2019

Accumulated Other Comprehensive Income [Abstract]

Components of Accumulated Other Comprehensive Loss

The following table provides the components of accumulated other comprehensive loss for 2019, 2018 and 2017:



(in millions)	Foreign Currency Translation			Postretirement Benefit Plans			Derivative Instruments			Total
Balance at January 1, 2017	$	(140	)	$	(177	)	$	(1	)	$	(318	)
Foreign currency translation adjustment	79									79
Income tax impact on foreign currency translation adjustment	46									46
Changes in postretirement benefit plans				(18		)				(18		)
Income tax expense on changes in postretirement benefit plans				7						7
Foreign currency translation adjustment for postretirement benefit plans				(18		)				(18		)
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net				11						11
Income tax impact on amortization of postretirement benefit plan items				(3		)				(3		)
Unrealized loss on derivative hedge agreements							9			9
Reclassification of unrealized (gain) loss on foreign exchange agreements into revenue							(6		)	(6		)
Reclassification of unrealized (gain) loss on foreign exchange agreements into cost of revenue	—						1			1
Balance at December 31, 2017	$	(15	)	$	(198	)	$	3		$	(210	)



(in millions)	Foreign Currency Translation			Postretirement Benefit Plans			Derivative Instruments			Total
Cumulative effect of change in accounting principle	(11		)	(6		)				(17		)
Foreign currency translation adjustment	(83		)							(83		)
Income tax impact on foreign currency translation adjustment	(12		)							(12		)
Changes in postretirement benefit plans				(36		)				(36		)
Foreign currency translation adjustment for postretirement benefit plans				15						15
Income tax expense on changes in postretirement benefit plans				5						5
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net				9						9
Income tax impact on amortization of postretirement benefit plan items				(3		)				(3		)
Unrealized loss on derivative hedge agreements							(8		)	(8		)
Reclassification of unrealized (gain) loss on foreign exchange agreements into cost of revenue							4			4
Balance at December 31, 2018	$	(121	)	$	(214	)	$	(1	)	$	(336	)
Foreign currency translation adjustment	27									27
Income tax impact on foreign currency translation adjustment	(9		)	—						(9		)
Changes in postretirement benefit plans				(83		)				(83		)
Settlement charge released into other non-operating income (expense), net				9						9
Foreign currency translation adjustment for postretirement benefit plans				(3		)				(3		)
Income tax expense on changes in postretirement benefit plans, including settlement				16						16
Amortization of prior service cost and net actuarial loss on postretirement benefit plans into other non-operating income (expense), net				8						8
Income tax impact on amortization of postretirement benefit plan items				(2		)				(2		)
Unrealized loss on derivative hedge agreements							(14		)	(14		)
Reclassification of unrealized loss on foreign exchange agreements into revenue							7			7
Reclassification of unrealized loss on foreign exchange agreements into cost of revenue							5			5
Balance at December 31, 2019	$	(103	)	$	(269	)	$	(3	)	$	(375	)

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Changes in product warranty accrual

The table below provides changes in the combined current and non-current product warranty accruals over each period.



(in millions)	2019			2018			2017
Warranty accrual – January 1	$	60		$	82		$	99
Net charges for product warranties in the period	25			20			28
Settlement of warranty claims	(42		)	(42		)	(48		)
Foreign currency and other	(2		)	—			3
Warranty accrual – December 31	$	41		$	60		$	82

Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Related Party Transactions

Sales to and purchases from unconsolidated entities for 2019, 2018 and 2017 are as follows:



(in millions)	2019		2018		2017
Sales to unconsolidated affiliates	$	10	$	10	$	12
Purchases from unconsolidated affiliates	22		22		17

Segment and Geographic Data (Tables)

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Financial information for each reportable segment



	Year Ended December 31,
(in millions)	2019			2018			2017
Revenue:
Water Infrastructure	$	2,177		$	2,176		$	2,004
Applied Water	1,541			1,534			1,421
Measurement & Control Solutions	1,531			1,497			1,282
Total	$	5,249		$	5,207		$	4,707
Operating income:
Water Infrastructure	$	365		$	359		$	312
Applied Water	241			236			194
Measurement & Control Solutions	(67		)	118			110
Corporate and other	(53		)	(59		)	(64		)
Total operating income	486			654			552
Interest expense	67			82			82
Other non-operating (expense) income, net	(4		)	13			6
Gain (loss) on sale of businesses	1			—			(10		)
Income before taxes	$	416		$	585		$	466
Depreciation and amortization:
Water Infrastructure	$	61		$	66		$	64
Applied Water	24			22			23
Measurement & Control Solutions	144			144			122
Regional selling locations (a)	18			20			17
Corporate and other	10			9			8
Total	$	257		$	261		$	234
Capital expenditures:
Water Infrastructure	$	79		$	84		$	58
Applied Water	19			28			20
Measurement & Control Solutions	100			101			69
Regional selling locations (b)	19			16			18
Corporate and other	9			8			5
Total	$	226		$	237		$	170


(a)	Depreciation and amortization expense incurred by the Regional selling locations was included in an overall allocation of Regional selling location costs to the segments; however, a certain portion of that expense was not specifically identified to a segment. That expense is captured in this Regional selling location line.

(b)

Represents capital expenditures incurred by the Regional selling locations not allocated to the segments.

Revenue by product category

The following table illustrates revenue by product category, net of intercompany revenue:



	Year Ended December 31,
(in millions)	2019		2018		2017
Pumps, accessories, parts and service	$	3,324	$	3,322	$	2,998
Other (a)	1,925		1,885		1,709
Total	$	5,249	$	5,207	$	4,707

(a)

Other includes treatment equipment, analytical instrumentation, heat exchangers, valves, controls and smart meters.

Total assets for each reportable segment

The following table contains the total assets for each reportable segment as of December 31, 2019, 2018 and 2017:



	Total Assets
(in millions)	2019		2018		2017
Water Infrastructure	$	1,268	$	1,233	$	1,232
Applied Water	1,016		1,051		1,002
Measurement & Control Solutions	3,497		3,576		3,198
Regional selling locations (a)	1,375		1,181		1,119
Corporate and other (b)	554		181		309
Total	$	7,710	$	7,222	$	6,860


(a)	The Regional selling locations have assets that consist primarily of cash, accounts receivable and inventory which are not allocated to the segments.

(b)

Corporate and other consists of items pertaining to our corporate headquarters function, which principally consist of cash, deferred tax assets, pension assets and certain plant and equipment.

Revenues and Property, Plant and Equipment by geographic location

Revenue is attributed to countries based upon the location of the customer. Property, Plant & Equipment is attributed to countries based upon the location of the assets:



	Revenue
	Year Ended December 31,
(in millions)	2019		2018		2017
United States	$	2,554	$	2,424	$	2,161
Europe	1,380		1,449		1,335
Asia Pacific	659		660		611
Other	656		674		600
Total	$	5,249	$	5,207	$	4,707



	Property, Plant & Equipment
	December 31,
(in millions)	2019		2018		2017
United States	$	274	$	281	$	258
Europe	249		250		259
Asia Pacific	67		66		85
Other	68		59		41
Total	$	658	$	656	$	643

Valuation and Qualifying Accounts (Tables)

12 Months Ended

Dec. 31, 2019

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

Schedule of Valuation and Qualifying Accounts

The table below provides changes in the allowance for doubtful accounts over each period:



(in millions)	2019			2018			2017
Balance at beginning of year	$	25		$	25		$	21
Additions charged to expense	3			5			5
Deductions/other	(3		)	(5		)	(1		)
Balance at end of year	$	25		$	25		$	25

Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (Unaudited)



	2019 Quarter Ended
(in millions, except per share amounts)	Dec. 31		Sept. 30		June 30		Mar. 31
Revenue	$	1,371	$	1,296	$	1,345	$	1,237
Gross profit	537		509		526		474
Operating income	195		11		171		109
Net income attributable to Xylem	$	118	$	65	$	139	$	79
Earnings per share:
Basic	$	0.66	$	0.36	$	0.77	$	0.44
Diluted	$	0.65	$	0.36	$	0.77	$	0.43



	2018 Quarter Ended
(in millions, except per share amounts)	Dec. 31		Sept. 30		June 30		Mar. 31
Revenue	$	1,386	$	1,287	$	1,317	$	1,217
Gross profit	542		505		519		460
Operating income	194		176		171		113
Net income attributable to Xylem	$	225	$	130	$	115	$	79
Earnings per share:
Basic	$	1.25	$	0.73	$	0.64	$	0.44
Diluted	$	1.24	$	0.72	$	0.64	$	0.43

Summary of Significant Accounting Policies (Property, Plant and Equipment, Useful Lives) (Details)	12 Months Ended
	Dec. 31, 2019
Building and improvements \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	5 years
Building and improvements \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	40 years
Machinery and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	2 years
Machinery and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	10 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	3 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	7 years
Equipment held for lease or rental \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	2 years
Equipment held for lease or rental \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful lives	10 years

Summary of Significant Accounting Policies (Details Textual) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($) Segment	Dec. 31, 2018 USD ($)
Operating segments \| Segment	3
Requisite service period	3 years
Average term of contract	6 months
Minimum
Intangible assets estimated economic useful lives	1 year
Maximum
Intangible assets estimated economic useful lives	25 years
Foreign Currency
Cash \| $	$ 510	$ 274

Recently Issued Accounting Standards (Details Textual) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2019	Jan. 01, 2018	Jan. 01, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease liability	$ 243								$ 243
Deferred Tax Asset, Lease Liability Recognized												$ 68
Right of use asset	241								241			267
Cumulative effect of change in accounting principle													$ (3)	$ (7)
Operating Income (Loss)	$ 195	$ 11	$ 171	$ 109	$ 194	$ 176	$ 171	$ 113	$ 486	$ 654	$ 552
Accounting Standards Update 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease liability												$ 265
Accounting Standards Update 2017-12
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of change in accounting principle					2					2
Adjustments for New Accounting Pronouncement
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating Income (Loss)											$ 4
Accumulated Other Comprehensive Income (Loss)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of change in accounting principle					(17)					(17)			(17)
Accumulated Other Comprehensive Income (Loss) \| Accounting Standards Update 2018-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of change in accounting principle					17					17
Retained Earnings
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of change in accounting principle													$ 14	$ (7)
Retained Earnings \| Accounting Standards Update 2018-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of change in accounting principle					$ 17					$ 17

Acquisitions and Divestitures (Details Textual) - USD ($) $ in Millions				3 Months Ended		10 Months Ended	12 Months Ended
	Jan. 31, 2018	Oct. 31, 2017	Feb. 17, 2017	Sep. 30, 2019	Dec. 31, 2018	Oct. 31, 2017	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Business Acquisition [Line Items]
Cash payment to acquire business, net of cash acquired							$ 18	$ 433	$ 33
Proceeds from divestiture of businesses							0	22	$ 16
Pure
Business Acquisition [Line Items]
Cash payment to acquire business, net of cash acquired	$ 420
Acquisition costs	$ 4
Revenue							96
Net income							2
Revenue							5,212	4,809
Other Acquisitions
Business Acquisition [Line Items]
Cash payment to acquire business, net of cash acquired							$ 13
Disposals \| Precision Die Casting
Business Acquisition [Line Items]
Proceeds from divestiture of businesses				$ 22
Revenue								32
Disposals \| Flowtronex and WET
Business Acquisition [Line Items]
Consideration		$ 6				$ 6
Gain (loss) on disposal		$ 1
Revenue						$ 9
Disposals \| UK and Poland Based Membranes Business
Business Acquisition [Line Items]
Consideration			$ 10
Gain (loss) on disposal			$ 5
Revenue								$ 8
Assets held-for-sale
Business Acquisition [Line Items]
Gain (loss) on disposal					$ (16)

Acquisitions and Divestitures (Summary of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Jan. 31, 2018	Dec. 31, 2017
Business Acquisition [Line Items]
Goodwill	$ 2,839	$ 2,976		$ 2,768
Pure
Business Acquisition [Line Items]
Cash			$ 14
Receivables			23
Inventories			4
Prepaid and other current assets			2
Property, plant and equipment			22
Intangible assets			149
Other long-term assets			1
Accounts payable			(3)
Accrued and other current liabilities			(12)
Deferred income tax liabilities			(25)
Other non-current accrued liabilities			(2)
Total identifiable net assets			173
Goodwill			261
Total consideration			$ 434

Acquisitions and Divestitures (Summary of Intangible Assets Acquired) (Details) - Pure - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Jan. 31, 2018
Business Acquisition [Line Items]
Intangible assets		$ 149
Customer Relationships
Business Acquisition [Line Items]
Intangible assets		84
Technology
Business Acquisition [Line Items]
Intangible assets		38
Tradenames
Business Acquisition [Line Items]
Life	20 years
Intangible assets		21
Software Development
Business Acquisition [Line Items]
Intangible assets		$ 6
Minimum \| Customer Relationships
Business Acquisition [Line Items]
Life	17 years
Minimum \| Technology
Business Acquisition [Line Items]
Life	3 years
Minimum \| Software Development
Business Acquisition [Line Items]
Life	3 years
Maximum \| Customer Relationships
Business Acquisition [Line Items]
Life	18 years
Maximum \| Technology
Business Acquisition [Line Items]
Life	10 years

Acquisitions and Divestitures (Summary of Pro Forma Information) (Details) - Pure - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Business Acquisition [Line Items]
Revenue	$ 5,212	$ 4,809
Net income	$ 546	$ 323

Restructuring and Asset Impairment Charges (Components of Restructuring Charges and Segment Allocation) (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Restructuring Cost and Reserve [Line Items]
Severance and other charges		$ 51	$ 19	$ 20
Lease related charges		1	1	0
Other restructuring charges		2	1	2
Reversal of restructuring accruals		(1)	(1)	(2)
Total restructuring charges		53	20	20
Asset impairment charges		10	2	5
Total restructuring and asset impairment charges		63	22	25
Restructuring and asset impairment charges		63	22	25
Water Infrastructure
Restructuring Cost and Reserve [Line Items]
Asset impairment charges	$ 2
Restructuring and asset impairment charges		20	11	7
Applied Water
Restructuring Cost and Reserve [Line Items]
Restructuring and asset impairment charges		5	2	13
Measurement & Control Solutions
Restructuring Cost and Reserve [Line Items]
Asset impairment charges		10
Restructuring and asset impairment charges		38	9	5
Corporate and other
Restructuring Cost and Reserve [Line Items]
Restructuring and asset impairment charges		$ 0	$ 0	$ 0

Revenue (Details) - USD ($) $ in Millions	12 Months Ended
Revenue (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Change in Contract with Customer, Asset [Abstract]
Beginning balance	$ 96	$ 89
Additions, net	81	87
Billings	(80)	76
Other	9	(4)
Ending balance	106	96
Change in Contract with Customer, Liability [Abstract]
Beginning balance	113	107
Additions, net	114	101
Revenue recognized from opening balance	(91)	(89)
Other	(1)	(6)
Ending balance	$ 135	$ 113

Restructuring and Asset Impairment Charges (Restructuring Reserve Rollforward) (Details) - USD ($)
$ in Millions

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

Foreign currency and other

$ 5

$ 7

Severance and other

$ 20

Cash payments

(30)

(21)

(28)

(1)

$ 7

Water Infrastructure

Applied Water

Measurement & Control Solutions

Regional Selling Locations

^[1]

^[1]

$ 7

$ 1

[1]	Regional selling locations consist primarily of selling and marketing organizations that incurred restructuring expense which was allocated to the segments. The liabilities associated with restructuring expense were not allocated to the segments.

Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									$ 5,002	$ 4,963
Other									247	244
Total	$ 1,371	$ 1,296	$ 1,345	$ 1,237	$ 1,386	$ 1,287	$ 1,317	$ 1,217	5,249	5,207	$ 4,707
United States
Disaggregation of Revenue [Line Items]
Total									2,554	2,424	2,161
Europe
Disaggregation of Revenue [Line Items]
Total									1,380	1,449	1,335
Water Infrastructure
Disaggregation of Revenue [Line Items]
Total									2,177	2,176	2,004
Water Infrastructure \| United States
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									593	539
Water Infrastructure \| Europe
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									729	758
Water Infrastructure \| Emerging Markets & Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									358	344
Water Infrastructure \| Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									250	291
Water Infrastructure \| Transport
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									1,533	1,535
Water Infrastructure \| Treatment
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									397	397
Applied Water
Disaggregation of Revenue [Line Items]
Total									1,541	1,534	$ 1,421
Applied Water \| United States
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									816	797
Applied Water \| Europe
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									362	386
Applied Water \| Emerging Markets & Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									164	153
Applied Water \| Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									199	198
Applied Water \| Commercial Building Services
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									848	828
Applied Water \| Industrial Water
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									693	706
Measurement & Control Solutions \| United States
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									972	913
Measurement & Control Solutions \| Europe
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									257	273
Measurement & Control Solutions \| Emerging Markets & Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									118	144
Measurement & Control Solutions \| Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									184	167
Measurement & Control Solutions \| Water
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									768	692
Measurement & Control Solutions \| Electric
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									337	338
Measurement & Control Solutions \| Software and Services/Other
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									99	123
Measurement & Control Solutions \| Test
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers									$ 327	$ 344

Restructuring and Asset Impairment Charges - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Restructuring Cost and Reserve [Line Items]
Asset impairment charges		$ 10	$ 2	$ 5
Water Infrastructure
Restructuring Cost and Reserve [Line Items]
Asset impairment charges	$ 2
Measurement & Control Solutions
Restructuring Cost and Reserve [Line Items]
Asset impairment charges		10
2016 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs		16
Incurred restructuring costs		1	15
2015 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs		23
Incurred restructuring costs		$ 2	$ 4	$ 11

Revenue (Narrative) (Details) $ in Millions	Dec. 31, 2019 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation	$ 392
Expected timing of recognition	60 months

Restructuring and Asset Impairment Charges - Estimated Restructuring Costs (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
2017 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	$ 52
Incurred restructuring costs	50
Expected costs remaining	2
2016 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	16
Incurred restructuring costs	1	$ 15
Expected costs remaining	0
2015 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	23
Incurred restructuring costs	2	4	$ 11
Expected costs remaining	6
Operating Segments \| Water Infrastructure \| 2017 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	19
Incurred restructuring costs	18
Expected costs remaining	1
Operating Segments \| Water Infrastructure \| 2016 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	8
Incurred restructuring costs	1	7
Expected costs remaining	0
Operating Segments \| Water Infrastructure \| 2015 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	12
Incurred restructuring costs	1	2	5
Expected costs remaining	4
Operating Segments \| Applied Water \| 2017 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	5
Incurred restructuring costs	5
Expected costs remaining	0
Operating Segments \| Applied Water \| 2016 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	1
Incurred restructuring costs	0	1
Expected costs remaining	0
Operating Segments \| Applied Water \| 2015 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	7
Incurred restructuring costs	0	1	4
Expected costs remaining	2
Operating Segments \| Measurement & Control Solutions \| 2017 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	28
Incurred restructuring costs	27
Expected costs remaining	1
Operating Segments \| Measurement & Control Solutions \| 2016 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	7
Incurred restructuring costs	0	7
Expected costs remaining	0
Operating Segments \| Measurement & Control Solutions \| 2015 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	4
Incurred restructuring costs	1	1	2
Expected costs remaining	0
Corporate \| 2017 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	0
Incurred restructuring costs	0
Expected costs remaining	0
Corporate \| 2016 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	0
Incurred restructuring costs	0	0
Expected costs remaining	0
Corporate \| 2015 Restructuring Plan
Restructuring Cost and Reserve [Line Items]
Expected restructuring costs	0
Incurred restructuring costs	0	$ 0	$ 0
Expected costs remaining	$ 0

Other Non-Operating Income, Net (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Other Income and Expenses [Abstract]
Interest income	$ 5	$ 4	$ 3
Income from joint ventures	3	5	3
Other income (expense) - net	(12)	4	0
Total other non-operating (expense) income, net	$ (4)	$ 13	$ 6

Income Taxes (Components of Income Tax Expense) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income components:
Domestic	$ 203	$ 208	$ 162
Foreign	213	377	304
Income before taxes	416	585	466
Current:
Domestic – federal	39	9	109
Domestic – state and local	13	13	9
Foreign	40	61	51
Total Current	92	83	169
Deferred:
Domestic – federal	7	17	(29)
Domestic – state and local	(1)	5	10
Foreign	(83)	(69)	(14)
Total Deferred	(77)	(47)	(33)
Total income tax provision	$ 15	$ 36	$ 136
Effective income tax rate	3.70%	6.10%	29.20%

Income Taxes (Income Tax Rate Reconciliation) (Details)	12 Months Ended
Income Taxes (Income Tax Rate Reconciliation) (Details)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Tax provision at U.S. statutory rate	21.00%	21.00%	35.00%
State income taxes	2.70%	2.30%	1.60%
Uncertain tax positions	0.40%	2.60%	1.60%
Valuation allowance	1.20%	(47.10%)	3.30%
Tax exempt interest	(3.00%)	(1.40%)	(10.60%)
Foreign tax rate differential	0.70%	2.90%	(6.70%)
Impact of foreign earnings, net	1.60%	(1.70%)	37.00%
Tax incentives	(9.60%)	(6.20%)	(6.60%)
Intercompany sale of assets	0.00%	35.50%	0.00%
Other – net	1.70%	(0.30%)	(0.50%)
Rate change	(18.10%)	0.00%	(22.90%)
Goodwill impairment	7.80%	0.00%	0.00%
Federal R&D tax credit	(1.20%)	(0.80%)	(1.00%)
Stock compensation	(1.50%)	(0.70%)	(1.00%)
Effective income tax rate	3.70%	6.10%	29.20%

Income Taxes (Components of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets:
Employee benefits	$ 106	$ 97
Accrued expenses	26	30
Loss and other tax credit carryforwards	240	279
Inventory	6	7
Lease Liabilities	57
Other	3	11
Total deferred tax assets	438	424
Valuation allowance	(191)	(234)
Net deferred tax asset	247	190
Deferred tax liabilities:
Intangibles	160	247
Investment in foreign subsidiaries	7	8
Property, plant, and equipment	78	69
Lease right-of-use assets	57
Other	29	29
Total deferred tax liabilities	$ 331	$ 353

Income Taxes (Reconciliation of Valuation Allowance of Deferred Tax Assets) (Details) - Valuation Allowance of Deferred Tax Assets - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at beginning of year	$ 234	$ 350	$ 311
Change in assessment (a)	(2)	1	(28)
Current year operations	2	(271)	48
Foreign currency and other	(43)	154	19
Balance at end of year	$ 191	$ 234	$ 350

Income Taxes (Classification of Unrecognized Tax Benefits) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Non-current assets	$ 226	$ 140
Non-current liabilities	(310)	(303)
Total net deferred tax liabilities	$ (84)	$ (163)

Income Taxes (Summary of Operating Losses and Tax Credits) (Details) $ in Millions	Dec. 31, 2019 USD ($)
United States
Operating Loss Carryforwards [Line Items]
Net operating loss	$ 8
State
Operating Loss Carryforwards [Line Items]
Net operating loss	98
Tax credits	2
Foreign
Operating Loss Carryforwards [Line Items]
Net operating loss	1,018
Tax credits	3
Excess Interest Expense \| State
Operating Loss Carryforwards [Line Items]
Tax credits	$ 9

Income Taxes (Summary of Unrecognized Tax Benefits) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefits — January 1	$ 136	$ 130	$ 67
Current year tax positions	3	0	56
Prior year tax positions		7	7
Prior year tax positions	(5)
Acquisitions	0	0	0
Settlements	(5)	(1)	0
Unrecognized tax benefits — December 31	$ 129	$ 136	$ 130

Income Taxes (Details Textual) - USD ($) $ in Millions	1 Months Ended	12 Months Ended
Income Taxes (Details Textual) - USD ($) $ in Millions	Jun. 30, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Tax Contingency [Line Items]
Valuation allowance			$ 191	$ 234
Reinvestments in foreign operations			1,300
Total income tax provision			$ 15	$ 36	$ 136
Effective income tax rate			3.70%	6.10%	29.20%
Unrecognized tax benefits			$ 129	$ 136	$ 130	$ 67
Interest accrued for unrecognized tax benefits			8	$ 7
Estimated loss	$ 80
Foreign
Income Tax Contingency [Line Items]
Deferred tax liability			9
State
Income Tax Contingency [Line Items]
Deferred tax liability			$ 505
Forecast
Income Tax Contingency [Line Items]
Unrecognized tax benefits, reduction due to lapse of statute of limitations		$ 4

Earnings Per Share (Calculation of EPS) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Basic and diluted net earnings per share:
Net income (in usd)	$ 118	$ 65	$ 139	$ 79	$ 225	$ 130	$ 115	$ 79	$ 401	$ 549	$ 331
Net income									$ 401	$ 549	$ 330
Shares
Weighted average common shares outstanding									179,958	179,750	179,602
Add: Participating securities									29	27	27
Weighted average common shares outstanding — Basic									179,987	179,777	179,629
Plus incremental shares from assumed conversions:
Weighted average common shares outstanding — Diluted									181,196	181,132	180,857
Basic earnings per share (in usd per share)	$ 0.66	$ 0.36	$ 0.77	$ 0.44	$ 1.25	$ 0.73	$ 0.64	$ 0.44	$ 2.23	$ 3.05	$ 1.84
Diluted earnings per share (in usd per share)	$ 0.65	$ 0.36	$ 0.77	$ 0.43	$ 1.24	$ 0.72	$ 0.64	$ 0.43	$ 2.21	$ 3.03	$ 1.83
Stock Options
Plus incremental shares from assumed conversions:
Dilutive effect of common shares									803	876	712
Restricted Stock
Plus incremental shares from assumed conversions:
Dilutive effect of common shares									406	479	516

Earnings Per Share (Summary of Antidilutive Securities) (Details) - shares shares in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Stock Options
Incremental shares from stock options and restricted stock:
Antidilutive securities	1,383	1,300	1,626
Restricted Stock
Incremental shares from stock options and restricted stock:
Antidilutive securities	348	333	379
Performance Based Shares
Incremental shares from stock options and restricted stock:
Antidilutive securities	394	465	504

Inventories (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Inventories
Finished goods	$ 212	$ 248
Work in process	47	45
Raw materials	280	302
Total inventories	$ 539	$ 595

Property, Plant and Equipment (Components of Property, Plant and Equipment) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment
Property, plant and equipment, gross	$ 1,702	$ 1,632
Less accumulated depreciation	1,044	976
Total property, plant and equipment, net	658	656
Land, buildings and improvements
Property, Plant and Equipment
Property, plant and equipment, gross	339	326
Machinery and equipment
Property, Plant and Equipment
Property, plant and equipment, gross	861	819
Equipment held for lease or rental
Property, Plant and Equipment
Property, plant and equipment, gross	256	249
Furniture and fixtures
Property, Plant and Equipment
Property, plant and equipment, gross	118	109
Construction work in progress
Property, Plant and Equipment
Property, plant and equipment, gross	104	107
Other
Property, Plant and Equipment
Property, plant and equipment, gross	$ 24	$ 22

Property, Plant and Equipment (Details Textual) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 117	$ 117	$ 109

Leases (Textuals) (Details) - USD ($) $ in Millions	12 Months Ended
Leases (Textuals) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2019
Lessor, Lease, Description [Line Items]
Operating liability, current	$ 61
Operating liability, noncurrent	185
Right-of-use assets	241			$ 267
Revenue from lease arrangements	247
Assets subject to rental	256
Assets subject to rental, accumulated amortization	166
Operating Leases, Rent Expense		$ 81	$ 70
Depreciation	117	$ 117	$ 109
Leased Assets
Lessor, Lease, Description [Line Items]
Depreciation	$ 28

Leases (Lease Costs) (Details) $ in Millions	12 Months Ended
Leases (Lease Costs) (Details) $ in Millions	Dec. 31, 2019 USD ($)
Leases [Abstract]
Operating lease cost	$ 76
Short-term lease cost	9
Variable lease cost	19
Total lease cost	$ 104

Leases (Supplemental Lease Information) (Details) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($)
Leases [Abstract]
Operating cash flows from operating leases	$ 73
Operating leases	$ 33
Operating leases	6 years
Operating leases	2.70%

Leases (Lease Maturities) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Operating Leases
2020	$ 65
2021	50
2022	37
2023	29
2024	21
Thereafter	62
Total lease payments	264
Less: Imputed interest	(21)
Total	$ 243
Operating Leases
2019		$ 76
2020		61
2021		43
2022		33
2023		22
Thereafter		64
Total lease payments		$ 299

Accrued and Other Current Liabilities (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Accrued and Other Current Liabilities
Compensation and other employee-benefits	$ 199	$ 194
Customer-related liabilities	153	129
Accrued warranty costs	36	44
Lease liabilities	61
Accrued taxes	79	85
Other accrued liabilities	100	94
Total accrued and other current liabilities	$ 628	$ 546

Goodwill and Other Intangible Assets (Rollforward of Goodwill) (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Changes in the carrying value of goodwill by operating segment
Beginning Balance		$ 2,976	$ 2,768
Goodwill acquired		19	279
Goodwill, Impairment Loss	$ (148)	(148)	0	$ 0
Foreign currency and other		(8)	(71)
Ending Balance		2,839	2,976	2,768
Water Infrastructure
Changes in the carrying value of goodwill by operating segment
Beginning Balance		653	667
Goodwill acquired		0	0
Goodwill, Impairment Loss		0
Foreign currency and other		(2)	(14)
Ending Balance		651	653	667
Applied Water
Changes in the carrying value of goodwill by operating segment
Beginning Balance		516	526
Goodwill acquired		0	0
Goodwill, Impairment Loss		0
Foreign currency and other		(3)	(10)
Ending Balance		513	516	526
Measurement & Control Solutions
Changes in the carrying value of goodwill by operating segment
Beginning Balance		1,807	1,575
Goodwill acquired		19	279
Goodwill, Impairment Loss		(148)
Foreign currency and other		(3)	(47)
Ending Balance		$ 1,675	$ 1,807	$ 1,575

Goodwill and Other Intangible Assets (Details Textual) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Sep. 30, 2019	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Goodwill and Other Intangible Assets (Textual) [Abstract]
Goodwill, Impairment Loss	$ 148		$ 148	$ 0	$ 0
Impairment of the indefinite-lived intangibles			0	0
Amortization expense related to finite-lived intangible assets			$ 140	$ 144	$ 125
Impairment of Intangible Assets, Finite-lived	$ 7	$ 3
Customer and Distributor Relationships
Goodwill and Other Intangible Assets (Textual) [Abstract]
Finite-Lived Intangible Asset, Useful Life			14 years
Internally Developed Network Software
Goodwill and Other Intangible Assets (Textual) [Abstract]
Finite-Lived Intangible Asset, Useful Life			5 years
Proprietary Technology
Goodwill and Other Intangible Assets (Textual) [Abstract]
Finite-Lived Intangible Asset, Useful Life			14 years
Trademarks
Goodwill and Other Intangible Assets (Textual) [Abstract]
Finite-Lived Intangible Asset, Useful Life			13 years
Other
Goodwill and Other Intangible Assets (Textual) [Abstract]
Finite-Lived Intangible Asset, Useful Life			5 years
Water Infrastructure
Goodwill and Other Intangible Assets (Textual) [Abstract]
Goodwill, Impairment Loss			$ 0

Goodwill and Other Intangible Assets (Summary of Other Intangible Assets) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Goodwill and Other Intangible Assets
Accumulated Amortization	$ (737)	$ (603)
Indefinite-lived intangibles	166	159
Intangible Assets Gross, Carrying Amount	1,911	1,835
Intangible Assets, Net Intangibles	1,174	1,232
Customer and Distributor Relationships
Goodwill and Other Intangible Assets
Carrying Amount	945	951
Accumulated Amortization	(352)	(286)
Net Intangibles	$ 593	665
Finite-Lived Intangible Asset, Useful Life	14 years
Proprietary Technology
Goodwill and Other Intangible Assets
Carrying Amount	$ 204	198
Accumulated Amortization	(111)	(93)
Net Intangibles	$ 93	105
Finite-Lived Intangible Asset, Useful Life	14 years
Trademarks
Goodwill and Other Intangible Assets
Carrying Amount	$ 148	148
Accumulated Amortization	(52)	(41)
Net Intangibles	$ 96	107
Finite-Lived Intangible Asset, Useful Life	13 years
Internally Developed Network Software
Goodwill and Other Intangible Assets
Carrying Amount	$ 428	355
Accumulated Amortization	(206)	(164)
Net Intangibles	$ 222	191
Finite-Lived Intangible Asset, Useful Life	5 years
Other
Goodwill and Other Intangible Assets
Carrying Amount	$ 20	24
Accumulated Amortization	(16)	(19)
Net Intangibles	$ 4	$ 5
Finite-Lived Intangible Asset, Useful Life	5 years

Goodwill and Other Intangible Assets (Estimated Amortization Expense) (Details) $ in Millions	Dec. 31, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2019	$ 136
2020	124
2021	115
2022	108
2023	$ 99

Credit Facilities and Long-Term Debt (Summary of Debt Outstanding) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Credit Facilities and Long-Term Debt :
Debt issuance costs and unamortized discount	$ (17)	$ (19)
Total debt	2,316	2,308
Less: short-term borrowings and current maturities of long-term debt	276	257
Long-term debt, net	2,040	2,051
4.875% Senior Notes Due 2021
Credit Facilities and Long-Term Debt :
Outstanding balances	600	600
2.250% Senior Notes Due 2023
Credit Facilities and Long-Term Debt :
Outstanding balances	557	570
Debt fair value	591	599
3.250% Senior Notes Due 2026
Credit Facilities and Long-Term Debt :
Outstanding balances	500	500
Debt fair value	518	476
4.375% Senior Notes Due 2046
Credit Facilities and Long-Term Debt :
Outstanding balances	400	400
Debt fair value	431	397
Commercial paper
Credit Facilities and Long-Term Debt :
Outstanding balances	276	0
Term loan
Credit Facilities and Long-Term Debt :
Outstanding balances	0	257
Level 1 \| 4.875% Senior Notes Due 2021
Credit Facilities and Long-Term Debt :
Debt fair value	$ 629	$ 620

Derivative Financial Instruments (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Derivative [Line Items]
Amount of (gain) loss reclassified from OCI into revenue	$ (1,371)	$ (1,296)	$ (1,345)	$ (1,237)	$ (1,386)	$ (1,287)	$ (1,317)	$ (1,217)	$ (5,249)	$ (5,207)	$ (4,707)
Other Comprehensive Income (Loss) \| Foreign Exchange Contract
Derivative [Line Items]
Amount of gain (loss) recognized in OCI									(14)	(8)	9
Other Comprehensive Income (Loss) \| Cross Currency Swaps
Derivative [Line Items]
Amount of gain (loss) recognized in OCI									22	22	(53)
Other Comprehensive Income (Loss) \| Foreign Currency Denominated Debt
Derivative [Line Items]
Amount of gain (loss) recognized in OCI									13	27	(74)
Reclassification out of Accumulated Other Comprehensive Income [Member] \| Foreign Exchange Contract
Derivative [Line Items]
Amount of (gain) loss reclassified from OCI into revenue									7	0	(6)
Amount of (gain) loss reclassified from OCI into cost of revenue									5	4	1
Interest Expense \| Cross Currency Swaps
Derivative [Line Items]
Amount of gain (loss) recognized in OCI									$ 16	$ 2	$ 0

Credit Facilities and Long-Term Debt (Details Textual)		9 Months Ended	12 Months Ended
Credit Facilities and Long-Term Debt (Details Textual)	Sep. 20, 2011 USD ($)	Sep. 30, 2019	Dec. 31, 2019 USD ($)	Jun. 03, 2019 USD ($)	Jun. 03, 2019 EUR (€)	Mar. 05, 2019 USD ($)	Dec. 31, 2018 USD ($)	Jan. 26, 2018 USD ($)	Jan. 26, 2018 EUR (€)	Oct. 11, 2016 USD ($)	Mar. 11, 2016 EUR (€)	Mar. 27, 2015 USD ($)
Debt Instrument
Commercial paper			$ 0				$ 0
Interest rate during period			1.12%
European Investment Bank - Research and Development Finance Contract
Debt Instrument
Credit facility							125,000,000
Repayment on credit facility			$ 120,000,000
Term of debt			11 years
Basis spread			0.59%
Letter of Credit
Debt Instrument
Debt instrument aggregate principal amount												$ 100,000,000
Revolving Credit Facility
Debt Instrument
Increase in borrowing capacity												200,000,000
Maximum increase in borrowing capacity												800,000,000
Debt instrument aggregate principal amount												600,000,000
Commercial paper
Debt Instrument
Senior notes issued			$ 600,000,000
Senior Notes
Debt Instrument
Redemption price percentage	101.00%
Line of Credit
Debt Instrument
Interest on notes due								0.45%	0.45%
Senior notes issued								$ 251,000,000	€ 225,000,000
Long-term Line of Credit			0				257,000,000
Commercial paper
Debt Instrument
Outstanding balances			276,000,000				0
3.250% Senior Notes Due 2026
Debt Instrument
Fair value of senior notes due			518,000,000				476,000,000
Interest on notes due										3.25%
Senior notes issued										$ 500,000,000
Outstanding balances			$ 500,000,000				500,000,000
Risk Sharing Finance Facility Agreement
Debt Instrument
Term of debt			5 years
Risk Sharing Finance Facility Agreement \| Term Loans
Debt Instrument
Term of debt			12 years
4.875% Senior Notes Due 2021
Debt Instrument
Interest on notes due	4.875%
Senior notes issued	$ 600,000,000
Outstanding balances			$ 600,000,000				600,000,000
2.250% Senior Notes Due 2023
Debt Instrument
Fair value of senior notes due			591,000,000				599,000,000
Outstanding balances			$ 557,000,000				570,000,000
2.250% Senior Notes Due 2023 \| Senior Notes
Debt Instrument
Interest on notes due											2.25%
Senior notes issued \| €											€ 500,000,000
Five-Year Revolving Credit Facility
Debt Instrument
Maximum leverage ratio			3.50
4.375% Senior Notes Due 2046
Debt Instrument
Fair value of senior notes due			$ 431,000,000				397,000,000
Interest on notes due										4.375%
Senior notes issued										$ 400,000,000
Outstanding balances			400,000,000				400,000,000
Five Year Revolving Credit Facility 2015 [Member] \| Revolving Credit Facility
Debt Instrument
Increase in borrowing capacity												200,000,000
Maximum increase in borrowing capacity												$ 800,000,000
Five Year Revolving Credit Facility 2019 [Member] \| Revolving Credit Facility
Debt Instrument
Increase in borrowing capacity						$ 200,000,000
Maximum increase in borrowing capacity						1,000,000,000
Debt instrument aggregate principal amount						$ 800,000,000
US Dollar Commercial Paper Program [Member]
Debt Instrument
Senior notes issued			600,000,000
Euro Commercial Paper Program [Member]
Debt Instrument
Senior notes issued				$ 557,000,000	€ 500,000,000
Commercial paper				$ 276,000,000
Commercial Paper, Weighted-Average Interest Rate Receivable		0.22%
Level 2 \| 4.875% Senior Notes Due 2021
Debt Instrument
Fair value of senior notes due			$ 629,000,000				$ 620,000,000

Derivative Financial Instruments (Details Textual) $ in Millions	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Mar. 11, 2016 EUR (€)
Derivative [Line Items]
Net unrealized gains on cash flow hedges	$ 3
Foreign Exchange Contract
Derivative [Line Items]
Notional amount	0	$ 506
Sell EUR Buy SEK
Derivative [Line Items]
Notional amount		191
Sell USD Buy EUR
Derivative [Line Items]
Notional amount		168
Sell GBP Buy EUR
Derivative [Line Items]
Notional amount		52
Sell EUR Buy PLN
Derivative [Line Items]
Notional amount		37
Buy USD Sell CDN
Derivative [Line Items]
Notional amount		29
Sell CDN Buy EUR
Derivative [Line Items]
Notional amount		22
Cross Currency Swap
Derivative [Line Items]
Notional amount	714	426
Senior Notes Due 2023
Derivative [Line Items]
Debt fair value	591	599
Senior Notes Due 2023 \| Senior Notes
Derivative [Line Items]
Interest rate			2.25%
Face amount \| €			€ 500,000,000
Designated as Hedging Instrument \| Long-term Debt
Derivative [Line Items]
Derivative, fair value	$ 554	$ 566

Derivative Financial Instruments - Fair Value of Foreign Exchange Contracts (Details) - Designated as Hedging Instrument - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Other current assets
Derivatives, Fair Value [Line Items]
Assets	$ 0	$ 3
Other Noncurrent Assets [Member]
Derivatives, Fair Value [Line Items]
Assets	4	0
Other current liabilities
Derivatives, Fair Value [Line Items]
Liabilities	0	(1)
Other non-current liabilities
Derivatives, Fair Value [Line Items]
Liabilities	$ (24)	$ (46)

Postretirement Benefit Plans (Summary of Contributions by Year) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Defined Contribution	$ 49	$ 39	$ 38

Postretirement Benefit Plans (Summary of Plan Assets, Benefit Obligation and Funded Status) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Defined Benefit Plan Disclosure
Fair value of plan assets	$ 605	$ 567
Projected benefit obligation	(1,008)	(914)
Unfunded status of the plans	(403)	(347)
Amounts recognized in the balance sheet
Other non-current assets	58	68
Accrued and other current liabilities	(16)	(15)
Accrued postretirement benefits	(445)	(400)
Net amount recognized	(403)	(347)
Accumulated other comprehensive income:
Net actuarial losses	(349)	(284)
Prior service credit	4	8
Total	(345)	(276)
Pension
Defined Benefit Plan Disclosure
Fair value of plan assets	605	567
Projected benefit obligation	(959)	(862)
Unfunded status of the plans	(354)	(295)
Amounts recognized in the balance sheet
Other non-current assets	58	68
Accrued and other current liabilities	(13)	(12)
Accrued postretirement benefits	(399)	(351)
Net amount recognized	(354)	(295)
Accumulated other comprehensive income:
Net actuarial losses	(330)	(260)
Prior service credit	(3)	(4)
Total	(333)	(264)
Other Benefits
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Projected benefit obligation	(49)	(52)	$ (55)
Unfunded status of the plans	(49)	(52)
Amounts recognized in the balance sheet
Other non-current assets	0	0
Accrued and other current liabilities	(3)	(3)
Accrued postretirement benefits	(46)	(49)
Net amount recognized	(49)	(52)
Accumulated other comprehensive income:
Net actuarial losses	(19)	(24)
Prior service credit	7	12
Total	(12)	(12)
NAV Practical Expedient
Defined Benefit Plan Disclosure
Fair value of plan assets	69	271
NAV Practical Expedient \| Global stock funds/securities
Defined Benefit Plan Disclosure
Fair value of plan assets	13	29
NAV Practical Expedient \| Index funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	1
NAV Practical Expedient \| Corporate bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	5	25
NAV Practical Expedient \| Government bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	27	20
NAV Practical Expedient \| Hedge funds
Defined Benefit Plan Disclosure
Fair value of plan assets	12	67
NAV Practical Expedient \| Private equity
Defined Benefit Plan Disclosure
Fair value of plan assets	0	6
NAV Practical Expedient \| Insurance contracts and other
Defined Benefit Plan Disclosure
Fair value of plan assets	3
Estimate of Fair Value Measurement
Defined Benefit Plan Disclosure
Fair value of plan assets	605	567
Estimate of Fair Value Measurement \| Global stock funds/securities
Defined Benefit Plan Disclosure
Fair value of plan assets	103	117
Estimate of Fair Value Measurement \| Index funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	1
Estimate of Fair Value Measurement \| Corporate bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	91	59
Estimate of Fair Value Measurement \| Government bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	62	51
Estimate of Fair Value Measurement \| Hedging Instruments
Defined Benefit Plan Disclosure
Fair value of plan assets	39	27
Estimate of Fair Value Measurement \| Hedge funds
Defined Benefit Plan Disclosure
Fair value of plan assets	12	67
Estimate of Fair Value Measurement \| Private equity
Defined Benefit Plan Disclosure
Fair value of plan assets	0	6
Estimate of Fair Value Measurement \| Insurance contracts and other
Defined Benefit Plan Disclosure
Fair value of plan assets	16	186
Estimate of Fair Value Measurement \| Level 1
Defined Benefit Plan Disclosure
Fair value of plan assets	488	262
Estimate of Fair Value Measurement \| Level 1 \| Global stock funds/securities
Defined Benefit Plan Disclosure
Fair value of plan assets	90	88
Estimate of Fair Value Measurement \| Level 1 \| Index funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 1 \| Corporate bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	86	34
Estimate of Fair Value Measurement \| Level 1 \| Government bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	35	31
Estimate of Fair Value Measurement \| Level 1 \| Hedging Instruments
Defined Benefit Plan Disclosure
Fair value of plan assets	4	5
Estimate of Fair Value Measurement \| Level 1 \| Hedge funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 1 \| Insurance contracts and other
Defined Benefit Plan Disclosure
Fair value of plan assets		104
Estimate of Fair Value Measurement \| Level 2
Defined Benefit Plan Disclosure
Fair value of plan assets	35	22
Estimate of Fair Value Measurement \| Level 2 \| Global stock funds/securities
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 2 \| Index funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 2 \| Corporate bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 2 \| Government bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 2 \| Hedging Instruments
Defined Benefit Plan Disclosure
Fair value of plan assets	35	22
Estimate of Fair Value Measurement \| Level 2 \| Hedge funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 2 \| Insurance contracts and other
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 3
Defined Benefit Plan Disclosure
Fair value of plan assets	13	12
Estimate of Fair Value Measurement \| Level 3 \| Global stock funds/securities
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 3 \| Index funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 3 \| Corporate bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 3 \| Government bonds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 3 \| Hedge funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	0
Estimate of Fair Value Measurement \| Level 3 \| Insurance contracts and other
Defined Benefit Plan Disclosure
Fair value of plan assets	13	12
Estimate of Fair Value Measurement \| NAV Practical Expedient \| Insurance contracts and other
Defined Benefit Plan Disclosure
Fair value of plan assets		70
Equity securities \| NAV Practical Expedient \| Diversified Growth and Income Funds
Defined Benefit Plan Disclosure
Fair value of plan assets	9	51
Equity securities \| Estimate of Fair Value Measurement \| Diversified Growth and Income Funds
Defined Benefit Plan Disclosure
Fair value of plan assets	9	51
Fixed income \| NAV Practical Expedient \| Diversified Growth and Income Funds
Defined Benefit Plan Disclosure
Fair value of plan assets	0	2
Fixed income \| Estimate of Fair Value Measurement \| Diversified Growth and Income Funds
Defined Benefit Plan Disclosure
Fair value of plan assets	$ 0	$ 2

Postretirement Benefit Plans (Summary of Amounts Recognized in Financial Statements) (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Change in benefit obligation:
Benefit obligation at beginning of year		$ 914
Benefit obligation at end of year		1,008	$ 914
Change in plan assets:
Beginning Balance		567
Employer contributions	$ 19
Ending Balance		605	567
Unfunded status of the plans		(403)	(347)
United States
Change in benefit obligation:
Benefit obligation at beginning of year		99	107
Service cost		3	3	$ 3
Interest cost		4	4	4
Benefits paid		(7)	(5)
Actuarial loss (gain)		15	(10)
Plan amendments, settlements and curtailments		0	0
Foreign currency translation/other		(1)	0
Benefit obligation at end of year		113	99	107
Change in plan assets:
Beginning Balance		97	84
Employer contributions		0	22
Actual return on plan assets		17	(4)
Benefits paid		(7)	(5)
Plan amendments, settlements and curtailments		0	0
Foreign currency translation/other		(2)	0
Ending Balance		105	97	84
Unfunded status of the plans		(8)	(2)
International defined benefit pension plans
Change in benefit obligation:
Benefit obligation at beginning of year		763	843
Service cost		9	9	12
Interest cost		19	19	21
Benefits paid		(28)	(36)
Actuarial loss (gain)		104	(20)
Plan amendments, settlements and curtailments		(23)	3
Foreign currency translation/other		2	(55)
Benefit obligation at end of year		846	763	843
Change in plan assets:
Beginning Balance		470	544
Employer contributions		16	16
Actual return on plan assets		52	(20)
Benefits paid		(28)	(36)
Plan amendments, settlements and curtailments		(23)	0
Foreign currency translation/other		13	(34)
Ending Balance		500	470	$ 544
Unfunded status of the plans		$ (346)	$ (293)

Postretirement Benefit Plans (Rollforward of Obligation) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Change in benefit obligation:
Benefit obligation at beginning of year	$ 914
Benefit obligation at end of year	1,008	$ 914
Other postretirement benefit plans
Change in benefit obligation:
Benefit obligation at beginning of year	52	55
Service cost	0	0	$ 1
Interest cost	2	2	2
Benefits paid	(3)	(3)
Actuarial gain/(loss)	(2)	1
Plan Amendment and other	0	(3)
Benefit obligation at end of year	$ 49	$ 52	$ 55

Postretirement Benefit Plans (Summary of Status of Plans) (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Retirement Benefits [Abstract]
Projected benefit obligation	$ 562	$ 500
Accumulated benefit obligation	526	470
Fair value of plan assets	$ 150	$ 137

Postretirement Benefit Plans (Components of Pension Plans) (Details) - USD ($) $ in Millions		12 Months Ended
	Jul. 31, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Other changes in plan assets and benefit obligations recognized in other comprehensive income
Net loss		$ 83	$ 37	$ 19
Prior service cost		0	0	1
Settlement		(9)	(1)	(1)
Total recognized in comprehensive income		0	0	(6)
Defined benefit pension plans
Net periodic benefit cost:
Net periodic benefit cost		19	5	12
Other changes in plan assets and benefit obligations recognized in other comprehensive income
Change recognized in other comprehensive income		69	12	33
Total recognized in comprehensive income		88	17	45
United States
Net periodic benefit cost:
Service cost		3	3	3
Interest cost		4	4	4
Expected return on plan assets		(8)	(7)	(6)
Amortization of net actuarial loss		1	2	2
Net periodic benefit cost		0	2	3
Other changes in plan assets and benefit obligations recognized in other comprehensive income
Net loss		6	1	1
Prior service cost		0	0	(1)
Amortization of net actuarial loss		(1)	(2)	(2)
Change recognized in other comprehensive income		5	(1)	0
International defined benefit pension plans
Net periodic benefit cost:
Service cost		9	9	12
Interest cost		19	19	21
Expected return on plan assets		(27)	(35)	(34)
Amortization of net actuarial loss		9	9	9
Settlement		9	1	1
Net periodic benefit cost		19	3	9
Other changes in plan assets and benefit obligations recognized in other comprehensive income
Net loss		79	35	23
Prior service cost		0	(3)	(1)
Amortization of net actuarial loss		(9)	(9)	(9)
Settlement		(9)	(1)	(1)
Foreign Exchange		3	(15)	19
Change recognized in other comprehensive income		$ 64	$ 13	$ 33
International defined benefit pension plans \| Defined benefit pension plans
Other changes in plan assets and benefit obligations recognized in other comprehensive income
Net loss	$ 11

Postretirement Benefit Plans (Amounts Recognized in OCI) (Details) - Other Benefits - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Defined Benefit Plan Disclosure
Service cost	$ 0	$ 0	$ 1
Interest cost	2	2	2
Defined Benefit Plan, Amortization of Prior Service Cost (Credit)	4	4	3
Amortization of net actuarial loss	2	2	2
Net periodic benefit cost	$ 0	$ 0	$ 2

Postretirement Benefit Plans (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Defined Benefit Plan Disclosure
Net loss	$ 83	$ 37	$ 19
Total recognized in comprehensive income	0	0	(6)
Other Benefits
Defined Benefit Plan Disclosure
Net loss	(2)	1	(5)
Defined Benefit Plan, Prior Service Credit	0	(3)	(3)
Amortization of prior service credit	4	4	3
Amortization of net actuarial loss	(2)	(2)	(2)
Foreign Exchange/Other	0	0	(1)
Change recognized in other comprehensive loss	$ 0	$ 0	$ (8)

Postretirement Benefit Plans (Discount Rates) (Details)	12 Months Ended
Postretirement Benefit Plans (Discount Rates) (Details)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Net Periodic Benefit Cost Assumptions
Expected long-term rate of return on plan assets	7.09%	7.34%	7.30%
United States
Benefit Obligation Assumptions
Discount rate	3.25%	4.50%	3.75%
Net Periodic Benefit Cost Assumptions
Discount rate	4.50%	3.75%	4.25%
Expected long-term rate of return on plan assets	7.75%	8.00%	8.00%
International
Benefit Obligation Assumptions
Discount rate	1.80%	2.60%	2.43%
Rate of future compensation increase	2.94%	2.92%	2.93%
Net Periodic Benefit Cost Assumptions
Discount rate	2.60%	2.43%	2.63%
Expected long-term rate of return on plan assets	6.96%	7.23%	7.20%
Rate of future compensation increase	2.92%	2.93%	2.76%

Postretirement Benefit Plans (Valuation Assumptions) (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Expected long-term rate of return on plan assets	7.09%	7.34%	7.30%
Actual rate of return (loss) on plan assets	12.59%	(3.85%)	5.70%

Postretirement Benefit Plans (Target Allocations) (Details)	Dec. 31, 2019	Dec. 31, 2018
Equity securities
Defined Benefit Plan Disclosure
Actual allocation of plan assets	18.60%	29.70%
Fixed income
Defined Benefit Plan Disclosure
Actual allocation of plan assets	31.70%	24.50%
Hedge funds
Defined Benefit Plan Disclosure
Actual allocation of plan assets	2.00%	11.80%
Private equity
Defined Benefit Plan Disclosure
Actual allocation of plan assets	0.00%	1.10%
Cash and other
Defined Benefit Plan Disclosure
Actual allocation of plan assets	47.70%	32.90%
Minimum \| Equity securities
Defined Benefit Plan Disclosure
Target allocation percentages	15.00%
Minimum \| Fixed income
Defined Benefit Plan Disclosure
Target allocation percentages	10.00%
Minimum \| Hedge funds
Defined Benefit Plan Disclosure
Target allocation percentages	0.00%
Minimum \| Private equity
Defined Benefit Plan Disclosure
Target allocation percentages	0.00%
Minimum \| Cash and other
Defined Benefit Plan Disclosure
Target allocation percentages	0.00%
Maximum \| Equity securities
Defined Benefit Plan Disclosure
Target allocation percentages	60.00%
Maximum \| Fixed income
Defined Benefit Plan Disclosure
Target allocation percentages	50.00%
Maximum \| Hedge funds
Defined Benefit Plan Disclosure
Target allocation percentages	40.00%
Maximum \| Private equity
Defined Benefit Plan Disclosure
Target allocation percentages	30.00%
Maximum \| Cash and other
Defined Benefit Plan Disclosure
Target allocation percentages	60.00%

Postretirement Benefit Plans (Rollforward of Fair Value Measurements) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]
Beginning Balance	$ 567
Ending Balance	605	$ 567
Other \| Level 3
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]
Beginning Balance	12	17
Purchases, sales, settlements	1	(5)
Impact on currency	0	0
Ending Balance	$ 13	$ 12

Postretirement Benefit Plans (Future Benefit Payments) (Details) $ in Millions	Dec. 31, 2019 USD ($)
Pension
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
2018	$ 37
2019	36
2020	37
2021	38
2022	39
Years 2022-2026	208
Other Benefits
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
2018	3
2019	3
2020	3
2021	3
2022	3
Years 2022-2026	$ 16

Postretirement Benefit Plans (Details Textual) - USD ($) shares in Thousands		3 Months Ended			12 Months Ended
	Jul. 31, 2019	Dec. 31, 2019	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Number of years eligible employees can receive transition credits					5 years
Number of shares held by employees in Employee Stock Ownership Plan		302			302	328
Charge resulting from curtailment or settlement recorded					$ 9,000,000	$ 1,000,000	$ 1,000,000
Prior service credit		$ (4,000,000)			(4,000,000)	(8,000,000)
Net actuarial losses, net of tax					14,000,000
Net actuarial losses expected to be recognized next fiscal year, before tax		18,000,000			18,000,000
Prior service cost expected to be recognized next fiscal year, before tax		3,000,000			3,000,000
Prior service cost expected to be recognized next fiscal year, net of tax					2,000,000
Accumulated benefit obligation		$ 919,000,000			$ 919,000,000	829,000,000
Expected long-term return on plan assets		3.46%			3.46%
Assumed rate of health care costs increases, next fiscal year		6.53%			6.53%
Ultimate assumed average annual health care cost increases		4.50%			4.50%
Effect of increase in health care trends by one percent per year on annual service interest (less than $1 million)					$ 1,000,000
Effect of decrease in health care trends by one percent per year on annual service interest (less than $1 million)					1,000,000
Effect of increase in health care trends by one percent per year on benefit obligation					3,000,000
Effect of decrease in health care trends by one percent per year on benefit obligation					4,000,000
Employer Contribution to defined benefit Plan				$ 19,000,000
Estimated pension plan contributions during the next fiscal quarter		$ 5,000,000			5,000,000
Net loss					$ (83,000,000)	$ (37,000,000)	$ (19,000,000)
Expected long-term rate of return on plan assets					7.09%	7.34%	7.30%
Fair value of plan assets		605,000,000			$ 605,000,000	$ 567,000,000
Pension
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Prior service credit		3,000,000			3,000,000	4,000,000
Employer Contribution to defined benefit Plan					19,000,000
Fair value of plan assets		605,000,000			605,000,000	567,000,000
Other Benefits
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Prior service credit		(7,000,000)			(7,000,000)	(12,000,000)
Net actuarial losses, before tax					(2,000,000)	(2,000,000)	$ (2,000,000)
Prior service credit, before tax					(4,000,000)	(4,000,000)	(3,000,000)
Employer Contribution to defined benefit Plan						41,000,000
Net loss					2,000,000	(1,000,000)	5,000,000
Fair value of plan assets		0			$ 0	0
Minimum
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Employer matching contribution					3.00%
Estimated pension plan contributions during next fiscal year		15,000,000			$ 15,000,000
Maximum
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Employer matching contribution					7.00%
Estimated pension plan contributions during next fiscal year		25,000,000			$ 25,000,000
Hedge funds
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Unfunded commitments		0			0	0
Private equity
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Unfunded commitments		$ 0			0	3,000,000
International defined benefit pension plans
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Charge resulting from curtailment or settlement recorded					9,000,000	1,000,000	1,000,000
Net actuarial losses, before tax					(9,000,000)	(9,000,000)	(9,000,000)
Employer Contribution to defined benefit Plan					16,000,000	16,000,000
Net loss					$ (79,000,000)	$ (35,000,000)	$ (23,000,000)
Expected long-term rate of return on plan assets					6.96%	7.23%	7.20%
Discount rate		1.80%			1.80%	2.60%	2.43%
Fair value of plan assets		$ 500,000,000			$ 500,000,000	$ 470,000,000	$ 544,000,000
International defined benefit pension plans \| Pension
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Payments for settlements			$ 21,000,000
Settlement charge released into other non-operating income (expense), net			8,000,000
Decrease from settlement	$ 37,000,000
Remeasurement due to settlement	26,000,000
Net loss	$ (11,000,000)
Expected long-term rate of return on plan assets	7.25%					0.70%
Discount rate	2.00%					3.00%
Incremental net periodic cost		5,000,000	$ 3,000,000
The UK Plan \| Cash and cash equivalents \| Other Benefits
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Fair value of plan assets		272,000,000			272,000,000
The UK Plan \| Hedging Instruments \| Other Benefits
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Fair value of plan assets		35,000,000			35,000,000
The UK Plan \| Govenment Bonds \| Other Benefits
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block
Fair value of plan assets		$ 11,000,000			$ 11,000,000

Stock-Based Compensation (Stock Option Activity) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Stock Options Outstanding, Beginning	2,125
Stock options, Granted	334
Stock options, Exercised	(348)
Stock options, Forfeited	(71)
Stock Options Outstanding, Ending	2,040	2,125
Options exercisable, Shares	1,432
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Weighted Average Exercise Price, Outstanding, Beginning	$ 43.08
Weighted Average Exercise Price / Share, Granted	74.08
Weighted Average Exercise Price / Share, Exercised	35.56
Weighted Average Exercise Price / Share, Forfeited	67.97
Weighted Average Exercise Price, Outstanding, Ending	48.56	$ 43.08
Options exercisable, Weighted Average Exercise Price	$ 39.83
Weighted Average Remaining Contractual Term, Outstanding	6 years 3 months 18 days	6 years 6 months
Aggregate intrinsic value of outstanding stock options	$ 62
Weighed average remaining contractual term, Options exercisable	5 years 3 months 18 days
Aggregate intrinsic value of exercisable stock options	$ 56
Vested and non-vested expected to vest as of December 31, 2019	1,996
Vested and non-vested expected to vest as of December 31, 2019	$ 48.00
Vested and non-vested expected to vest as of December 31, 2019	6 years 2 months 12 days
Aggregate intrinsic value, vested and expected to vest	$ 61

Stock-Based Compensation (Fair Value Assumptions) (Details) - $ / shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Payment Arrangement [Abstract]
Dividend yield	1.30%	1.12%	1.49%
Volatility	24.10%	23.41%	25.39%
Risk-free interest rate	2.55%	2.76%	2.07%
Expected term (in years)	5 years 4 months 24 days	5 years 1 month 6 days	5 years 1 month 6 days
Weighted-average fair value / share	$ 17.04	$ 17.80	$ 10.66

Stock-Based Compensation (Restricted Stock Unit Activity) (Details) - Restricted Stock shares in Thousands	12 Months Ended
	Dec. 31, 2019 $ / shares shares
Summary of restricted stock activity
Outstanding Shares, Beginning \| shares	537
Restricted Stock, Granted \| shares	287
Vested \| shares	(257)
Forfeited \| shares	(55)
Outstanding Shares, Ending \| shares	512
Weighted Average Grant Date Fair Value / Share
Weighted Average Grant Date Fair Value, Outstanding at January 1, 2016 \| $ / shares	$ 59.41
Weighted Average Grant Date Fair Value, Granted \| $ / shares	74.36
Weighted Average Grant Date Fair Value, Vested \| $ / shares	55.09
Weighted Average Grant Date Fair Value, Forfeited \| $ / shares	67.80
Weighted Average Grant Date Fair Value, Outstanding at December 31, 2016 \| $ / shares	$ 68.95

Stock-Based Compensation (Performance Share Activity) (Details) - Performance Based Shares shares in Thousands	12 Months Ended
	Dec. 31, 2019 $ / shares shares
Summary of Performance-based shares activity
Vested \| shares	(174)
Weighted Average Grant Date Fair Value / Share
Weighted Average Grant Date Fair Value, Vested \| $ / shares	$ 37.86
ROIC Performance Share Unit Grants
Summary of Performance-based shares activity
Outstanding Shares, Beginning \| shares	274
Granted \| shares	77
Forfeited \| shares	(26)
Outstanding Shares, Ending \| shares	225
Weighted Average Grant Date Fair Value / Share
Weighted Average Grant Date Fair Value, Outstanding at January 1, 2016 \| $ / shares	$ 52.11
Weighted Average Grant Date Fair Value, Granted \| $ / shares	74.07
Weighted Average Grant Date Fair Value, Forfeited \| $ / shares	63.89
Weighted Average Grant Date Fair Value, Outstanding at December 31, 2016 \| $ / shares	$ 64.51
Share-based Compensation Arrangement By Share-based Payment Award, Equity Instruments Other Than Options, Adjustments In Period \| shares	74
Share-based Compensation Arrangement By Share-based Payment Award, Equity Instruments Other Than Options, Adjustments In Period, Weighted Average Grant Date Fair Value \| $ / shares	$ 37.86
TSR Performance Share Unit Grants
Summary of Performance-based shares activity
Outstanding Shares, Beginning \| shares	274
Granted \| shares	77
Vested \| shares	(174)
Forfeited \| shares	(26)
Outstanding Shares, Ending \| shares	225
Weighted Average Grant Date Fair Value / Share
Weighted Average Grant Date Fair Value, Outstanding at January 1, 2016 \| $ / shares	$ 61.04
Weighted Average Grant Date Fair Value, Granted \| $ / shares	89.62
Weighted Average Grant Date Fair Value, Vested \| $ / shares	37.86
Weighted Average Grant Date Fair Value, Forfeited \| $ / shares	63.89
Weighted Average Grant Date Fair Value, Outstanding at December 31, 2016 \| $ / shares	$ 75.80
Share-based Compensation Arrangement By Share-based Payment Award, Equity Instruments Other Than Options, Adjustments In Period \| shares	74
Share-based Compensation Arrangement By Share-based Payment Award, Equity Instruments Other Than Options, Adjustments In Period, Weighted Average Grant Date Fair Value \| $ / shares	$ 37.86

Stock-Based Compensation (Details Textual) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Oct. 31, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	$ 29	$ 30	$ 21
Proceeds from exercise of employee stock options	13	$ 7	$ 16
Tax benefit from the exercise of stock options	$ 13
Shares awarded	334
Shares outstanding	2,040	2,125
Non-vested options outstanding	600	700	900
Weighted average grant date fair value	$ 69.30	$ 58.00	$ 42.84
Aggregate intrinsic value of outstanding stock options	$ 62
Aggregate intrinsic value of exercisable stock options	56
Total intrinsic value of options exercised	15	$ 9	$ 14
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized compensation expense	$ 6
Weighted average period	1 year 9 months 18 days
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized compensation expense	$ 22
Weighted average period	1 year 9 months 18 days
Shares awarded	287
Performance Based Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized compensation expense	$ 10
Weighted average period	1 year 3 months 18 days
Requisite service periods	3 years
Target payout percentage	100.00%
2011 Omnibus Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares initially available for awards				18,000
Shares available for future grant	6,000

Stock-Based Compensation (TSR Fair Value Assumptions) (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate	2.55%	2.76%	2.07%
Dividend yield	1.30%	1.12%	1.49%
TSR Performance Share Unit Grants \| Performance Based Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility	20.90%
Risk-free interest rate	2.52%

Capital Stock (Details Textual) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Aug. 24, 2015	Aug. 18, 2012
Class of Stock [Line Items]
Common Stock, shares authorized	750,000	750,000
Common Stock, par value (in dollars per share)	$ 0.01	$ 0.01
Dividends declared per share (in usd per share)	$ 0.96	$ 0.84	$ 0.72
Shares repurchased	536	810	490
Shares repurchased, value	$ 40	$ 59
2015 Stock Repurchase Program
Class of Stock [Line Items]
Authorized amount				$ 500
Shares repurchased	300	700
Shares repurchased, value	$ 25	$ 50
Remaining authorized repurchase amount	$ 338
2012 Stock Repurchase Program
Class of Stock [Line Items]
Shares repurchased	300
Shares repurchased, value	$ 13
Number of shares authorized to be repurchased					2,000
Settlement of Employee Tax Withholding Obligations
Class of Stock [Line Items]
Shares repurchased	200	100
Shares repurchased, value	$ 15	$ 9

Capital Stock (Changes in Common Stock Outstanding) (Details) - shares shares in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Changes in Common Stock Outstanding [Roll Forward]
Beginning Balance, January 1	179,724	179,862	179,367
Stock incentive plan net activity	952	672	985
Repurchase of common stock	(536)	(810)	(490)
Ending Balance, December 31	180,140	179,724	179,862

Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2018	Jan. 01, 2017
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance	$ (336)
Cumulative effect of change in accounting principle				$ (3)	$ (7)
Foreign currency translation adjustment	28	$ (85)	$ 79
Amortization of prior service credit cost	(4)	(4)	(3)
Foreign currency translation adjustment for postretirement benefit plans	(3)	15	(18)
Unrealized (loss) gain	(14)	(8)	9
Reclassification of unrealized gain on derivative hedge agreements into revenue	12	4	(5)
Ending Balance	(375)	(336)
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance	(336)	(210)	(318)
Cumulative effect of change in accounting principle		(17)		$ (17)
Foreign currency translation adjustment	27	(83)	79
Income tax impact on foreign currency translation adjustment	(9)	(12)	46
Amortization of prior service credit cost	(83)	(36)	(18)
Income tax expense on changes in postretirement benefit plans		5	7
Foreign currency translation adjustment for postretirement benefit plans	(3)	15	(18)
Income tax expense on changes in postretirement benefit plans, including settlement	16
Income tax impact on amortization of postretirement benefit plan items	(2)	(3)	(3)
Unrealized (loss) gain			9
Ending Balance	(375)	(336)	(210)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance	(121)	(15)	(140)
Cumulative effect of change in accounting principle		(11)
Foreign currency translation adjustment	27	(83)	79
Income tax impact on foreign currency translation adjustment	(9)	(12)	46
Ending Balance	(103)	(121)	(15)
Postretirement Benefit Plans
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance	(214)	(198)	(177)
Cumulative effect of change in accounting principle		(6)
Amortization of prior service credit cost	(83)	(36)	(18)
Income tax expense on changes in postretirement benefit plans		5	7
Foreign currency translation adjustment for postretirement benefit plans	(3)	15	(18)
Income tax expense on changes in postretirement benefit plans, including settlement	16
Income tax impact on amortization of postretirement benefit plan items	(2)	(3)	(3)
Ending Balance	(269)	(214)	(198)
Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning Balance	(1)	3	(1)
Unrealized (loss) gain	(14)	(8)	9
Ending Balance	(3)	(1)	3
Nonoperating Income (Expense) \| Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Income tax impact on amortization of postretirement benefit plan items	8	9	11
Nonoperating Income (Expense) \| Postretirement Benefit Plans
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Income tax impact on amortization of postretirement benefit plan items	8	9	11
Cost of Revenue \| Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Unrealized (loss) gain			1
Reclassification of unrealized gain on derivative hedge agreements into revenue	5
Cost of Revenue \| Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Unrealized (loss) gain			1
Reclassification of unrealized gain on derivative hedge agreements into revenue	5
Revenue \| Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Unrealized (loss) gain			(6)
Reclassification of unrealized gain on derivative hedge agreements into revenue	7
Revenue \| Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Unrealized (loss) gain			$ (6)
Reclassification of unrealized gain on derivative hedge agreements into revenue	7
Other Expense [Member] \| Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Settlement charge released into other non-operating income (expense), net	9
Other Expense [Member] \| Postretirement Benefit Plans
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Settlement charge released into other non-operating income (expense), net	$ 9
Cross Currency Swaps \| Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Reclassification of unrealized gain on derivative hedge agreements into revenue		4
Cross Currency Swaps \| Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Reclassification of unrealized gain on derivative hedge agreements into revenue
Cross Currency Swaps \| Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Reclassification of unrealized gain on derivative hedge agreements into revenue		$ 4

Commitments and Contingencies (Rent Expense) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 81	$ 70

Commitments and Contingencies (Future Minimum Rental Payments) (Details) $ in Millions	Dec. 31, 2018 USD ($)
Minimum rental payments under operating leases
2019	$ 76
2020	61
2021	43
2022	33
2023	22
Thereafter	$ 64

Commitments and Contingencies (Rollforward of Warranties) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Warranties
Warranty accrual – January 1	$ 60	$ 82	$ 99
Net charges for product warranties in the period	25	20	28
Settlement of warranty claims	(42)	(42)	(48)
Foreign currency and other	(2)	0	3
Warranty accrual – December 31	$ 41	$ 60	$ 82

Commitments and Contingencies (Details Textual) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Loss contingency accrued	$ 5	$ 7
Guarantee amounts	340	275
Estimated environmental matters	3	4
Warranty expense	$ 25	$ 20	$ 28

Related Party Transactions (Details) - Affiliated Entity - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Related Party Transaction [Line Items]
Sales to unconsolidated affiliates	$ 10	$ 10	$ 12
Purchases from unconsolidated affiliates	$ 22	$ 22	$ 17

Segment and Geographic Data (Summary of Operating Results by Segment) (Details) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2019 USD ($) Segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Segment Reporting Information [Line Items]
Number of Reportable Segments \| Segment									3
Financial information for each reportable segment
Revenue	$ 1,371	$ 1,296	$ 1,345	$ 1,237	$ 1,386	$ 1,287	$ 1,317	$ 1,217	$ 5,249	$ 5,207	$ 4,707
Operating income	$ 195	$ 11	$ 171	$ 109	$ 194	$ 176	$ 171	$ 113	486	654	552
Other non-operating (expense) income, net									(4)	13	6
Gain (loss) on sale of businesses									1	0	(10)
Interest Expense									67	82	82
Income before taxes									416	585	466
Depreciation and amortization									257	261	234
Capital expenditures									226	237	170
Water Infrastructure
Financial information for each reportable segment
Revenue									2,177	2,176	2,004
Operating income									365	359	312
Depreciation and amortization									61	66	64
Capital expenditures									79	84	58
Applied Water
Financial information for each reportable segment
Revenue									1,541	1,534	1,421
Operating income									241	236	194
Depreciation and amortization									24	22	23
Capital expenditures									19	28	20
Measurement & Control Solutions
Financial information for each reportable segment
Revenue									1,531	1,497	1,282
Operating income									(67)	118	110
Depreciation and amortization									144	144	122
Capital expenditures									100	101	69
Regional Selling Locations
Financial information for each reportable segment
Depreciation and amortization									18	20	17
Capital expenditures									19	16	18
Corporate and other
Financial information for each reportable segment
Operating income									(53)	(59)	(64)
Depreciation and amortization									10	9	8
Capital expenditures									$ 9	$ 8	$ 5

Segment and Geographic Data (Revenue by Segment) (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenue from External Customer [Line Items]
Revenue	$ 1,371	$ 1,296	$ 1,345	$ 1,237	$ 1,386	$ 1,287	$ 1,317	$ 1,217	$ 5,249	$ 5,207	$ 4,707
Pumps, accessories, parts and service
Revenue from External Customer [Line Items]
Revenue									3,324	3,322	2,998
Other
Revenue from External Customer [Line Items]
Revenue									$ 1,925	$ 1,885	$ 1,709

Segment and Geographic Data (Assets by Segment (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Total assets for each reportable segment
Total assets	$ 7,710	$ 7,222	$ 6,860
Water Infrastructure
Total assets for each reportable segment
Total assets	1,268	1,233	1,232
Applied Water
Total assets for each reportable segment
Total assets	1,016	1,051	1,002
Measurement & Control Solutions
Total assets for each reportable segment
Total assets	3,497	3,576	3,198
Regional Selling Locations
Total assets for each reportable segment
Total assets	1,375	1,181	1,119
Corporate and other
Total assets for each reportable segment
Total assets	$ 554	$ 181	$ 309

Segment and Geographic Data (Summary of Revenue and Property, Plant and Equipment by Geographical Location) (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 1,371	$ 1,296	$ 1,345	$ 1,237	$ 1,386	$ 1,287	$ 1,317	$ 1,217	$ 5,249	$ 5,207	$ 4,707
Property, plant and equipment	658				656				658	656	643
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue									2,554	2,424	2,161
Property, plant and equipment	274				281				274	281	258
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue									1,380	1,449	1,335
Property, plant and equipment	249				250				249	250	259
Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue									659	660	611
Property, plant and equipment	67				66				67	66	85
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue									656	674	600
Property, plant and equipment	$ 68				$ 59				$ 68	$ 59	$ 41

Valuation and Qualifying Accounts (Details) - Allowance for Doubtful Accounts - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at beginning of year	$ 25	$ 25	$ 21
Additions charged to expense	3	5	5
Deductions/other	(3)	(5)	(1)
Balance at end of year	$ 25	$ 25	$ 25

Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Quarterly Financial Information Disclosure [Abstract]
Revenue	$ 1,371	$ 1,296	$ 1,345	$ 1,237	$ 1,386	$ 1,287	$ 1,317	$ 1,217	$ 5,249	$ 5,207	$ 4,707
Gross Profit	537	509	526	474	542	505	519	460	2,046	2,026	1,847
Operating income	195	11	171	109	194	176	171	113	486	654	552
Net income	$ 118	$ 65	$ 139	$ 79	$ 225	$ 130	$ 115	$ 79	$ 401	$ 549	$ 331
Basic (in dollars per share)	$ 0.66	$ 0.36	$ 0.77	$ 0.44	$ 1.25	$ 0.73	$ 0.64	$ 0.44	$ 2.23	$ 3.05	$ 1.84
Diluted (in dollars per share)	$ 0.65	$ 0.36	$ 0.77	$ 0.43	$ 1.24	$ 0.72	$ 0.64	$ 0.43	$ 2.21	$ 3.03	$ 1.83

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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-Topic 260
-SubTopic 10
-Section 45
-Paragraph 60B
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=117326831&loc=SL5780133-109256

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(19))
-URI http://asc.fasb.org/extlink&oid=116637232&loc=SL114874131-224263

+ Details