v3.20.1
Cover
 6 Months Ended
Mar. 31, 2020
shares
Entity Information [Line Items]  
Document Type 10-Q
Document Quarterly Report true
Document Period End Date Mar. 31, 2020
Document Transition Report false
Entity File Number 1-278
Entity Registrant Name EMERSON ELECTRIC CO.
Entity Central Index Key 0000032604
Current Fiscal Year End Date --09-30
Document Fiscal Year Focus 2020
Document Fiscal Period Focus Q2
Entity Incorporation, State or Country Code MO
Entity Tax Identification Number 43-0259330
Entity Address, Address Line One 8000 W. Florissant Ave.
Entity Address, Address Line Two P.O. Box 4100
Entity Address, City or Town St. Louis,
Entity Address, State or Province MO
Entity Address, Postal Zip Code 63136
City Area Code 314
Local Phone Number 553-2000
Entity Current Reporting Status Yes
Entity Interactive Data Current Yes
Entity Filer Category Large Accelerated Filer
Entity Small Business false
Entity Emerging Growth Company false
Entity Shell Company false
Entity Common Stock, Shares Outstanding 597,475,300
Amendment Flag false
NEW YORK STOCK EXCHANGE, INC. [Member] | Common Stock of $0.50 par value per share [Member]  
Entity Information [Line Items]  
Title of 12(b) Security Common Stock of $0.50 par value per share
Trading Symbol EMR
Security Exchange Name NYSE
NEW YORK STOCK EXCHANGE, INC. [Member] | 0.375% Notes due 2024 [Member]  
Entity Information [Line Items]  
Title of 12(b) Security 0.375% Notes due 2024
Trading Symbol EMR 24
Security Exchange Name NYSE
NEW YORK STOCK EXCHANGE, INC. [Member] | 1.250% Notes due 2025 [Member]  
Entity Information [Line Items]  
Title of 12(b) Security 1.250% Notes due 2025
Trading Symbol EMR 25A
Security Exchange Name NYSE
NEW YORK STOCK EXCHANGE, INC. [Member] | 2.000% Notes due 2029 [Member]  
Entity Information [Line Items]  
Title of 12(b) Security 2.000% Notes due 2029
Trading Symbol EMR 29
Security Exchange Name NYSE
CHICAGO STOCK EXCHANGE, INC [Member] | Common Stock of $0.50 par value per share [Member]  
Entity Information [Line Items]  
Title of 12(b) Security Common Stock of $0.50 par value per share
Trading Symbol EMR
Security Exchange Name CHX
v3.20.1
Consolidated Statements Of Earnings - USD ($)
$ in Millions
 3 Months Ended 6 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Mar. 31, 2020
Mar. 31, 2019
Net sales $ 4,162 $ 4,570 $ 8,313 $ 8,717
Costs and expenses:        
Cost of sales 2,412 2,645 4,804 5,031
Selling, general and administrative expenses 983 1,145 2,106 2,222
Other deductions, net 42 57 220 107
Interest expense (net of interest income of $6, $7, $12 and $12 respectively) 36 48 71 91
Earnings before income taxes 689 675 1,112 1,266
Income taxes 165 150 259 274
Net earnings 524 525 853 992
Less: Noncontrolling interests in earnings of subsidiaries 7 5 10 7
Net earnings common stockholders $ 517 $ 520 $ 843 $ 985
Basic earnings per share common stockholders $ 0.85 $ 0.85 $ 1.38 $ 1.59
Diluted earnings per share common stockholders 0.84 0.84 1.37 1.58
Cash dividends per common share $ 0.50 $ 0.49 $ 1.00 $ 0.98
v3.20.1
Consolidated Statements Of Earnings (Parenthetical) - USD ($)
$ in Millions
 3 Months Ended 6 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Mar. 31, 2020
Mar. 31, 2019
Income Statement [Abstract]        
Interest income $ 6 $ 7 $ 12 $ 12
v3.20.1
Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions
 3 Months Ended 6 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Mar. 31, 2020
Mar. 31, 2019
Net earnings $ 524 $ 525 $ 853 $ 992
Other comprehensive income (loss), net of tax:        
Foreign currency translation (281) 88 (182) 53
Pension and postretirement 30 12 58 25
Cash flow hedges (75) 25 (56) 10
Total other comprehensive income (loss) (326) 125 (180) 88
Comprehensive income 198 650 673 1,080
Less: Noncontrolling interests in comprehensive income of subsidiaries 8 6 11 8
Comprehensive income common stockholders $ 190 $ 644 $ 662 $ 1,072
v3.20.1
Consolidated Balance Sheets - USD ($)
$ in Millions
Mar. 31, 2020
Sep. 30, 2019
Current assets    
Cash and equivalents $ 2,583 $ 1,494
Receivables, less allowances of $112 and $112, respectively 2,641 2,985
Inventories 2,058 1,880
Other current assets 750 780
Total current assets 8,032 7,139
Property, plant and equipment, net 3,553 3,642
Other assets    
Goodwill 6,520 6,536
Other intangible assets 2,498 2,615
Other 1,108 565
Total other assets 10,126 9,716
Total assets 21,711 20,497
Current liabilities    
Short-term borrowings and current maturities of long-term debt 3,741 1,444
Accounts payable 1,521 1,874
Accrued expenses 2,678 2,658
Total current liabilities 7,940 5,976
Long-term debt 3,960 4,277
Other liabilities 2,248 1,971
Equity    
Common stock, $0.50 par value; authorized, 1,200.0 shares; issued, 953.4 shares; outstanding, 597.5 shares and 611.0 shares, respectively 477 477
Additional paid-in-capital 453 393
Retained earnings 24,431 24,199
Accumulated other comprehensive income (loss) (1,903) (1,722)
Cost of common stock in treasury, 355.9 shares and 342.4 shares, respectively (15,941) (15,114)
Common stockholders’ equity 7,517 8,233
Noncontrolling interests in subsidiaries 46 40
Total equity 7,563 8,273
Total liabilities and equity $ 21,711 $ 20,497
v3.20.1
Consolidated Balance Sheets (Parenthetical) - USD ($)
shares in Millions, $ in Millions
Mar. 31, 2020
Sep. 30, 2019
Statement of Financial Position [Abstract]    
Allowance for doubtful accounts receivable $ 112 $ 112
Common stock, par value per share $ 0.50 $ 0.50
Common stock, shares authorized 1,200.0 1,200.0
Common stock, shares issued 953.4 953.4
Common stock, shares outstanding 597.5 611.0
Treasury stock, shares 355.9 342.4
v3.20.1
Consolidated Statement of Equity Statement - USD ($)
$ in Millions
Total
Common stock
Additional paid-in-capital
Retained earnings
Accumulated other comprehensive income (loss)
Treasury stock
Noncontrolling interests in subsidiaries
Beginning balance at Sep. 30, 2018     $ 348 $ 23,072 $ (1,015) $ (13,935) $ 43
Statement [Roll Forward]              
Stock plans     32        
Net earnings common stockholders $ 985     985      
Dividends paid       (607)     (5)
Foreign currency translation 53       52    
Pension and postretirement         25    
Cash flow hedges 10       10    
Purchases           (1,000)  
Issued under stock plans           57  
Net earnings             7
Other comprehensive income 88           1
Ending balance at Mar. 31, 2019 8,572 $ 477 380 23,475 (928) (14,878) 46
Beginning balance at Dec. 31, 2018     375 23,252 (1,052) (14,816) 40
Statement [Roll Forward]              
Stock plans     5        
Net earnings common stockholders 520     520      
Dividends paid       (302)     0
Foreign currency translation 88       87    
Pension and postretirement         12    
Cash flow hedges 25       25    
Purchases           (75)  
Issued under stock plans           13  
Net earnings             5
Other comprehensive income 125           1
Ending balance at Mar. 31, 2019 8,572 477 380 23,475 (928) (14,878) 46
Statement [Roll Forward]              
Common stockholders' equity 8,526            
Common stockholders' equity 8,233            
Beginning balance at Sep. 30, 2019 8,273   393 24,199 (1,722) (15,114) 40
Statement [Roll Forward]              
Stock plans     60        
Net earnings common stockholders 843     843      
Dividends paid       (611)     (5)
Foreign currency translation (182)       (183)    
Pension and postretirement         58    
Cash flow hedges (56)       (56)    
Purchases           (942)  
Issued under stock plans           115  
Net earnings             10
Other comprehensive income (180)           1
Ending balance at Mar. 31, 2020 7,563 477 453 24,431 (1,903) (15,941) 46
Beginning balance at Dec. 31, 2019     447 24,220 (1,576) (15,147) 38
Statement [Roll Forward]              
Stock plans     6        
Net earnings common stockholders 517     517      
Dividends paid       (306)     0
Foreign currency translation (281)       (282)    
Pension and postretirement         30    
Cash flow hedges (75)       (75)    
Purchases           (813)  
Issued under stock plans           19  
Net earnings             7
Other comprehensive income (326)           1
Ending balance at Mar. 31, 2020 7,563 $ 477 $ 453 $ 24,431 $ (1,903) $ (15,941) $ 46
Statement [Roll Forward]              
Common stockholders' equity $ 7,517            
v3.20.1
Consolidated Statements Of Cash Flows - USD ($)
$ in Millions
 6 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Operating activities    
Net earnings $ 853 $ 992
Adjustments to reconcile net earnings to net cash provided by operating activities:    
Depreciation and amortization 422 406
Stock compensation 18 52
Pension expense 34 0
Changes in operating working capital (260) (530)
Other, net (55) (64)
Cash provided by operating activities 1,012 856
Investing activities    
Capital expenditures (225) (274)
Purchases of businesses, net of cash and equivalents acquired (96) (243)
Divestitures of businesses 0 5
Other, net (42) (65)
Cash used in investing activities (363) (577)
Financing activities    
Net increase in short-term borrowings 2,076 851
Proceeds from short-term borrowings greater than three months 433 0
Proceeds from long-term debt 0 1,135
Payments of long-term debt (502) (406)
Dividends paid (611) (607)
Purchases of common stock (942) (1,000)
Other, net 39 29
Cash provided by financing activities 493 2
Effect of exchange rate changes on cash and equivalents (53) 10
Increase in cash and equivalents 1,089 291
Beginning cash and equivalents 1,494 1,093
Ending cash and equivalents 2,583 1,384
Changes in operating working capital    
Receivables 283 175
Inventories (216) (205)
Other current assets 32 (82)
Accounts payable (290) (211)
Accrued expenses (69) (207)
Changes in operating working capital $ (260) $ (530)
v3.20.1
Basis of Presentation
 6 Months Ended
Mar. 31, 2020
Accounting Policies [Abstract]  
Basis of Presentation BASIS OF PRESENTATION
In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary for a fair presentation of operating results for the interim periods presented. Adjustments consist of normal and recurring accruals. The consolidated financial statements are presented in accordance with the requirements of Form 10-Q and consequently do not include all disclosures required for annual financial statements presented in conformity with U.S. generally accepted accounting principles (GAAP). For further information, refer to the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended September 30, 2019. Certain prior year amounts have been reclassified to conform to current year presentation.

On October 1, 2019, the Company adopted ASC 842, Leases, which requires rights and obligations related to lease arrangements to be recognized on the balance sheet, using the optional transition method under which prior periods were not adjusted. The Company elected the package of practical expedients for leases that commenced prior to the adoption date, which included carrying forward the historical lease classification as operating or finance. The adoption of ASC 842 resulted in the recognition of operating lease right-of-use assets and related lease liabilities of approximately $500 as of October 1, 2019, but did not materially impact the Company's earnings or cash flows for the three and six months ended March 31, 2020.
On October 1, 2019, the Company adopted updates to ASC 815, Derivatives and Hedging, which permit hedging certain contractually specified risk components. Additionally, the updates eliminate the requirement to separately measure and report hedge ineffectiveness and simplify hedge documentation and effectiveness assessment requirements. These updates were adopted using a modified retrospective approach and were immaterial to the Company's financial statements for the three and six months ended March 31, 2020.
v3.20.1
Revenue Recognition
 6 Months Ended
Mar. 31, 2020
Revenue from Contract with Customer [Abstract]  
Revenue Recognition REVENUE RECOGNITION
Emerson is a global manufacturer that combines technology and engineering to provide innovative solutions to its customers, largely in the form of tangible products. The vast majority of the Company's revenues relate to a broad offering of manufactured products which are recognized at the point in time when control transfers, while a smaller portion is recognized over time or relates to sales arrangements with multiple performance obligations. See Note 13 for additional information about the Company's revenues.

The following table summarizes the balances of the Company's unbilled receivables (contract assets), which are reported in Other current assets, and its customer advances (contract liabilities), which are reported in Accrued expenses.  
Sept 30, 2019Mar 31, 2020
Unbilled receivables (contract assets)$456  397  
Customer advances (contract liabilities)(519) (587) 
      Net contract liabilities$(63) (190) 
        
The majority of the Company's contract balances relate to arrangements where revenue is recognized over time and payments from customers are made according to a contractual billing schedule. The increase in net contract liabilities was due to customer billings which exceeded revenue recognized for performance completed during the period. Revenue recognized for the three and six months ended March 31, 2020 included approximately $56 and $326, respectively, that was included in the beginning contract liability balance. Other factors that impacted the change in net contract liabilities were immaterial. Revenue recognized for the six months ended March 31, 2020 for performance obligations that were satisfied in previous periods, including cumulative catchup adjustments on the Company's long-term contracts, was not material.
As of March 31, 2020, the Company's backlog relating to unsatisfied (or partially unsatisfied) performance obligations in contracts with its customers was approximately $5.7 billion. The Company expects to recognize approximately 85 percent of its remaining performance obligations as revenue over the next 12 months, with the remainder substantially over the subsequent two years thereafter.
v3.20.1
Weighted Average Common Shares
 6 Months Ended
Mar. 31, 2020
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]  
Weighted Average Common Shares WEIGHTED-AVERAGE COMMON SHARES
Reconciliations of weighted-average shares for basic and diluted earnings per common share follow. Earnings allocated to participating securities were inconsequential.
Three Months Ended
March 31,		Six Months Ended
March 31,
 2019  2020  2019  2020  
Basic shares outstanding614.0  607.4  619.0  608.7  
Dilutive shares4.1  3.6  3.9  3.9  
Diluted shares outstanding618.1  611.0  622.9  612.6  
v3.20.1
Acquisitions and Divestitures
 6 Months Ended
Mar. 31, 2020
Business Combinations [Abstract]  
Acquisitions and Divestitures ACQUISITIONS AND DIVESTITURES
During the first six months of 2020, the Company's acquisition spending totaled $96, net of cash acquired.

The Company acquired eight businesses in 2019, all in the Automation Solutions segment, for $469, net of cash acquired. These eight businesses had combined annual sales of approximately $300. The Company recognized goodwill of $213 ($158 of which is expected to be tax deductible) and other identifiable intangible assets of $155, primarily customer relationships and intellectual property with a weighted-average life of approximately nine years.
Valuations of certain acquired assets and liabilities are in-process and subject to refinement for transactions completed after March 31, 2019.
v3.20.1
Pension & Postretirement Expenses
 6 Months Ended
Mar. 31, 2020
Defined Benefit Plan [Abstract]  
Pension & Postretirement Plans PENSION & POSTRETIREMENT PLANS
Total periodic pension and postretirement (income) expense is summarized below:
 Three Months Ended March 31,Six Months Ended March 31,
 2019  2020  2019  2020  
Service cost$18  22  $36  44  
Interest cost50  40  100  80  
Expected return on plan assets
(88) (84) (176) (168) 
Net amortization16  38  33  75  
Total$(4) 16  $(7) 31  
v3.20.1
Other Deductions, Net
 6 Months Ended
Mar. 31, 2020
Other Income and Expenses [Abstract]  
Other Deductions, Net OTHER DEDUCTIONS, NET
Other deductions, net are summarized below:
 Three Months Ended
March 31,		Six Months Ended
March 31,
 2019  2020  2019  2020  
Amortization of intangibles (intellectual property and customer
relationships)		$60  59  $117  118  
Restructuring costs10  31  20  128  
Special advisory fees—  —  —  13  
Other(13) (48) (30) (39) 
Total$57  42  $107  220  

In the second quarter of fiscal 2020, the change in Other included favorable impacts from foreign currency transactions of $36 and supplemental retirement plans of $16, partially offset by an unfavorable impact from pensions of $16. On a year-to-date basis, the change in Other reflects a favorable impact from foreign currency transactions of $22 and lower litigation costs, partially offset by an unfavorable impact from pensions of $30.
v3.20.1
Restructuring Costs
 6 Months Ended
Mar. 31, 2020
Restructuring and Related Activities [Abstract]  
Restructuring Costs RESTRUCTURING COSTS
Restructuring expense reflects costs associated with the Company’s ongoing efforts to improve operational efficiency and deploy assets globally in order to remain competitive on a worldwide basis. The costs incurred in the first half of fiscal 2020 largely relate to the Company's initiatives to improve operating margins that began in the third quarter of fiscal 2019 and include workforce reductions of approximately 1,800 employees. The Company expects fiscal 2020 restructuring expense and related costs to be approximately $280, an increase of $65 compared to its previous estimate, including costs to complete actions initiated in the first half of the year.

Restructuring expense by business segment follows:
 Three Months Ended
March 31,		Six Months Ended
March 31,
 2019  2020  2019  2020  
Automation Solutions$6  23  11  106  
Climate Technologies1  2  4  9  
Tools & Home Products2  5  4  8  
Commercial & Residential Solutions3  7  8  17  
Corporate1  1  1  5  
Total$10  31  20  128  

Details of the change in the liability for restructuring costs during the six months ended March 31, 2020 follow:
 Sept 30, 2019  Expense  Utilized/Paid  Mar 31, 2020  
Severance and benefits$62  105  57  110  
Other7  23  26  4  
Total$69  128  83  114  
The tables above do not include $9 of costs related to these restructuring actions incurred in the second quarter of fiscal 2020 that U.S. GAAP requires to be reported in cost of sales.
v3.20.1
Income Taxes
 6 Months Ended
Mar. 31, 2020
Income Tax Disclosure [Abstract]  
Income Taxes INCOME TAXES
Income taxes were $165 in the second quarter of fiscal 2020 and $150 in 2019, resulting in effective tax rates of 24 percent and 22 percent, respectively. The current year rate included unfavorable discrete items, which increased the rate 1 percentage point, while the prior year rate included favorable discrete tax items, which reduced the rate 2 percentage points.

Income taxes were $259 for the first six months of 2020 and $274 for 2019, resulting in effective tax rates of 23 percent and 22 percent, respectively. The prior year rate included favorable discrete items, which reduced the rate 2 percentage points.
On March 27, 2020, the CARES Act (the "Act") was enacted in response to the COVID-19 pandemic, and among other things, provides tax relief to businesses. Tax provisions of the Act include the deferral of certain payroll taxes, relief for retaining employees, and other provisions. The Company is evaluating the impact of the Act and currently expects to benefit from the deferral of certain payroll taxes through the end of calendar year 2020.
v3.20.1
Leases
 6 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Leases LEASES
The Company leases offices; manufacturing facilities and equipment; and transportation, information technology and office equipment under operating lease arrangements. Finance lease arrangements are immaterial. The Company determines whether an arrangement is, or contains, a lease at contract inception. An arrangement contains a lease if the Company has the right to direct the use of and obtain substantially all of the economic benefits of an identified asset. Right-of-use assets and lease liabilities are recognized at lease commencement based on the present value of lease payments over the lease term. Leases with an initial term of 12 months or less are not recognized on the balance sheet and are recorded as short-term lease expense. The discount rate used to calculate present value is the Company's incremental borrowing rate based on the lease term and the economic environment of the applicable country or region.

Certain leases contain renewal options or options to terminate prior to lease expiration, which are included in the measurement of right-of-use assets and lease liabilities when it is reasonably certain they will be exercised. The Company has elected to account for lease and non-lease components as a single lease component for its offices and manufacturing facilities. Some lease arrangements include payments that are adjusted periodically based on actual charges incurred for common area maintenance, utilities, taxes and insurance, or changes in an index or rate referenced in the lease. The fixed portion of these payments is included in the measurement of right-of-use assets and lease liabilities at lease commencement, while the variable portion is recorded as variable lease expense. The Company's leases typically do not contain material residual value guarantees or restrictive covenants.

The components of lease expense for the three and six months ended March 31, 2020 were as follows:
 Three Months EndedSix Months Ended
March 31, 2020
Operating lease expense$53  106  
Variable lease expense$5  10  

Short-term lease expense and sublease income were immaterial for the three and six months ended March 31, 2020. Cash paid for operating leases is classified within operating cash flows and was $101 for the six months ended March 31, 2020. Operating lease right-of-use asset additions were $123 for the six months ended March 31, 2020.

The following table summarizes the balances of the Company's operating lease right-of-use assets and operating lease liabilities as of March 31, 2020, the vast majority of which relates to offices and manufacturing facilities:
Mar 31, 2020
Right-of-use assets (Other assets)$496  
Current lease liabilities (Accrued expenses)$148  
Noncurrent lease liabilities (Other liabilities)$353  
The weighted-average remaining lease term for operating leases was 5.2 years and the weighted-average discount rate was 2.8 percent as of March 31, 2020.

Future maturities of operating lease liabilities as of March 31, 2020 are summarized below:
Mar 31, 2020
Remainder of 2020$84  
2021132  
2022100  
202373  
202451  
Thereafter94  
Total lease payments534  
Less: Interest33  
Total lease liabilities$501  

Lease commitments that have not yet commenced were immaterial as of March 31, 2020.
The future minimum annual rentals under noncancelable long-term leases as of September 30, 2019 were as follows: $159 in 2020, $112 in 2021, $82 in 2022, $57 in 2023, $38 in 2024 and $63 thereafter.
v3.20.1
Other Financial Information
 6 Months Ended
Mar. 31, 2020
Disclosure Text Block [Abstract]  
Other Financial Information OTHER FINANCIAL INFORMATION

Sept 30, 2019Mar 31, 2020
Inventories
Finished products$578  641  
Raw materials and work in process1,302  1,417  
Total$1,880  2,058  

Property, plant and equipment, net  
Property, plant and equipment, at cost$8,671  8,734  
Less: Accumulated depreciation5,029  5,181  
     Total$3,642  3,553  

Goodwill by business segment
Automation Solutions$5,467  5,404  
Climate Technologies668  726  
Tools & Home Products401  390  
Commercial & Residential Solutions1,069  1,116  
     Total$6,536  6,520  

Other intangible assets  
Gross carrying amount$4,872  4,916  
Less: Accumulated amortization2,257  2,418  
     Net carrying amount$2,615  2,498  
Other intangible assets include customer relationships of $1,305 and $1,391 as of March 31, 2020 and September 30, 2019, respectively.
Sept 30, 2019Mar 31, 2020
Other assets include the following:
Operating lease right-of-use assets$—  496  
Pension assets164  230  
Asbestos-related insurance receivables115  105  
Deferred income taxes97  83  

Accrued expenses include the following:
Customer advances (contract liabilities)$519  587  
Employee compensation606  512  
Operating lease liabilities (current)—  148  
Product warranty140  134  

Other liabilities include the following:  
Pension and postretirement liabilities$775  770  
Operating lease liabilities (noncurrent)—  353  
Deferred income taxes327  339  
Asbestos litigation313  305  
v3.20.1
Financial Instruments
 6 Months Ended
Mar. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Financial Instruments FINANCIAL INSTRUMENTS
Following is a discussion regarding the Company’s use of financial instruments:
Hedging Activities – As of March 31, 2020, the notional amount of foreign currency hedge positions was approximately $2.2 billion, and commodity hedge contracts totaled approximately $122 (primarily 50 million pounds of copper and aluminum). All derivatives receiving hedge accounting are cash flow hedges. The majority of hedging gains and losses deferred as of March 31, 2020 are expected to be recognized over the next 12 months as the underlying forecasted transactions occur. Gains and losses on foreign currency derivatives reported in Other deductions, net reflect hedges of balance sheet exposures that do not receive hedge accounting.
Net Investment Hedge – In fiscal 2019, the Company issued euro-denominated debt of €1.5 billion. The euro notes reduce foreign currency risk associated with the Company's international subsidiaries that use the euro as their functional currency and have been designated as a hedge of a portion of the investment in these operations. Foreign currency gains or losses associated with the euro-denominated debt are deferred in accumulated other comprehensive income (loss) and will remain until the hedged investment is sold or substantially liquidated.
The following gains and losses are included in earnings and other comprehensive income (OCI) for the three and six months ended March 31, 2020 and 2019:
Into EarningsInto OCI
2nd QuarterSix Months2nd QuarterSix Months
Gains (Losses)Location2019  2020  2019  2020  2019  2020  2019  2020  
CommodityCost of sales$(3) (1) (6) (4) 10  (23) 3  (16) 
Foreign currency
Sales
(1) (1) (3) (3) (1) (8) (2) (5) 
Foreign currency
Cost of sales
5  4  9  11  23  (66) 12  (49) 
Foreign currency
Other deductions, net
29  13  40  21  
Net Investment Hedges
Euro denominated debt6  57  6  31  
     Total $30  15  $40  25  38  (40) 19  (39) 
Regardless of whether derivatives and non-derivative financial instruments receive hedge accounting, the Company expects hedging gains or losses to be essentially offset by losses or gains on the related underlying exposures. The amounts ultimately recognized will differ from those presented above for open positions, which remain subject to ongoing market price fluctuations until settlement. Derivatives receiving hedge accounting are highly effective and no amounts were excluded from the assessment of hedge effectiveness.

Fair Value Measurement – Valuations for all derivatives and the Company's long-term debt fall within Level 2 of the GAAP valuation hierarchy. As of March 31, 2020, the fair value of long-term debt was $4.5 billion, which exceeded the carrying value by $280. The fair values of commodity and foreign currency contracts were reported in Other current assets and Accrued expenses and did not materially change since September 30, 2019.
Counterparties to derivatives arrangements are companies with investment-grade credit ratings. The Company has bilateral collateral arrangements with counterparties with credit rating-based posting thresholds that vary depending on the arrangement. If credit ratings on the Company's debt fall below pre-established levels, counterparties can require immediate full collateralization of all derivatives in net liability positions. The maximum amount that could potentially have been required was $53. The Company also can demand full collateralization of derivatives in net asset positions should any counterparty credit ratings fall below certain thresholds. No collateral was posted with counterparties and none was held by the Company as of March 31, 2020.
v3.20.1
Accumulated Other Comprehensive Income (Loss)
 6 Months Ended
Mar. 31, 2020
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Accumulated Other Comprehensive Income (Loss) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Activity in Accumulated other comprehensive income (loss) for the three and six months ended March 31, 2020 and 2019 is shown below, net of income taxes:  
Three Months Ended March 31,Six Months Ended March 31,
2019  2020  2019  2020  
Foreign currency translation
   Beginning balance$(635) (695) (600) (794) 
   Other comprehensive income (loss), net of tax of $(1), $(13), $(1)
     and $(7), respectively
87  (282) 52  (183) 
   Ending balance(548) (977) (548) (977) 
Pension and postretirement
   Beginning balance(407) (900) (420) (928) 
Amortization of deferred actuarial losses into earnings, net of tax
  of $(4), $(8), $(8) and $(17), respectively
12  30  25  58  
   Ending balance(395) (870) (395) (870) 
Cash flow hedges
   Beginning balance(10) 19  5  —  
Deferral of gains (losses) arising during the period, net of tax
  of $(8), $23, $(3) and $17, respectively
24  (74) 10  (53) 
   Reclassification of realized (gains) losses to sales and cost of
     sales, net of tax of $0, $1, $0 and $1, respectively
1  (1) —  (3) 
   Ending balance15  (56) 15  (56) 
Accumulated other comprehensive income (loss)$(928) (1,903) (928) (1,903) 
v3.20.1
Business Segments
 6 Months Ended
Mar. 31, 2020
Segment Reporting [Abstract]  
Business Segments BUSINESS SEGMENTS
Summarized information about the Company's results of operations by business segment follows:
 Three Months Ended March 31,Six Months Ended March 31,
 SalesEarningsSalesEarnings
 2019  2020  2019  2020  2019  2020  2019  2020  
Automation Solutions$3,010  2,709  444  391  5,809  5,561  851  701  
Climate Technologies1,092  1,026  226  217  1,972  1,899  372  368  
Tools & Home Products469  432  102  89  927  862  193  175  
Commercial & Residential Solutions
1,561  1,458  328  306  2,899  2,761  565  543  
Stock compensation
(59) 38  (52) (18) 
Unallocated pension and
postretirement costs		27  12  54  25  
Corporate and other(17) (22) (61) (68) 
Eliminations/Interest(1) (5) (48) (36) 9  (9) (91) (71) 
     Total$4,570  4,162  675  689  8,717  8,313  1,266  1,112  

The decrease in stock compensation expense reflects the decline in the Company's stock price in the current year.

Automation Solutions sales by major product offering are summarized below:
 Three Months Ended March 31,Six Months Ended March 31,
 2019  2020  2019  2020  
Measurement & Analytical Instrumentation$927  816  1,785  1,646  
Valves, Actuators & Regulators937  854  1,811  1,767  
Industrial Solutions574  494  1,116  1,001  
Process Control Systems & Solutions572  545  1,097  1,147  
     Automation Solutions$3,010  2,709  5,809  5,561  

Depreciation and amortization (includes intellectual property, customer relationships and capitalized software) by business segment are summarized below:
Three Months Ended March 31,Six Months Ended March 31,
2019  2020  2019  2020  
Automation Solutions$131  138  $260  277  
Climate Technologies45  45  90  89  
Tools & Home Products17  19  36  38  
Commercial & Residential Solutions62  64  126  127  
Corporate and other11  9  20  18  
     Total$204  211  $406  422  
Sales by geographic destination are summarized below:
Three Months Ended March 31,
20192020
 Automation SolutionsCommercial & Residential SolutionsTotalAutomation SolutionsCommercial & Residential SolutionsTotal
Americas$1,523  1,082  2,605  1,346  1,037  2,383  
Asia, Middle East & Africa910  285  1,195  830  235  1,065  
Europe577  194  771  533  186  719  
     Total$3,010  1,561  4,571  2,709  1,458  4,167  
Six Months Ended March 31,
20192020
Automation SolutionsCommercial & Residential SolutionsTotalAutomation SolutionsCommercial & Residential SolutionsTotal
Americas$2,928  1,989  4,917  2,756  1,900  4,656  
Asia, Middle East & Africa1,751  550  2,301  1,726  512  2,238  
Europe1,130  360  1,490  1,079  349  1,428  
     Total$5,809  2,899  8,708  5,561  2,761  8,322  
v3.20.1
Revenue Recognition (Tables)
 6 Months Ended
Mar. 31, 2020
Revenue from Contract with Customer [Abstract]  
Schedule of Contract Assets and Contract Liabilities
The following table summarizes the balances of the Company's unbilled receivables (contract assets), which are reported in Other current assets, and its customer advances (contract liabilities), which are reported in Accrued expenses.  
Sept 30, 2019Mar 31, 2020
Unbilled receivables (contract assets)$456  397  
Customer advances (contract liabilities)(519) (587) 
      Net contract liabilities$(63) (190) 
v3.20.1
Weighted Average Common Shares (Tables)
 6 Months Ended
Mar. 31, 2020
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]  
Schedule Of Basic And Diluted Earnings Per Share Reconciliation
Three Months Ended
March 31,		Six Months Ended
March 31,
 2019  2020  2019  2020  
Basic shares outstanding614.0  607.4  619.0