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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
 ____________________________________ 
FORM 10-Q
____________________________________ 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 001-39220
____________________________________ 
CARRIER GLOBAL CORPORATION
(Exact name of registrant as specified in its charter)
____________________________________ 
Delaware 83-4051582
(State or Other Jurisdiction of Incorporation or Organization)(I.R.S. Employer Identification No.)
13995 Pasteur Boulevard, Palm Beach Gardens, Florida 33418
(Address of principal executive offices, including zip code)
(561) 365-2000
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock ($0.01 par value)CARRNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No   
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filerSmaller reporting companyEmerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  
As of April 17, 2023, there were 834,838,102 shares of Common Stock outstanding.
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CARRIER GLOBAL CORPORATION
CONTENTS OF QUARTERLY REPORT ON FORM 10-Q
Three Months Ended March 31, 2023
Page

Carrier Global Corporation and its subsidiaries' names, abbreviations thereof, logos and product and service designators are all either the registered or unregistered trademarks or trade names of Carrier Global Corporation and its subsidiaries. Names, abbreviations of names, logos and products and service designators of other companies are either the registered or unregistered trademarks or trade names of their respective owners. As used herein, the terms "we," "us," "our," "the Company" or "Carrier," unless the context otherwise requires, mean Carrier Global Corporation and its subsidiaries. References to internet websites in this Form 10-Q are provided for convenience only. Information available through these websites is not incorporated by reference into this Form 10-Q.









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PART I – FINANCIAL INFORMATION
Item 1.    Financial Statements

CARRIER GLOBAL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)

 Three Months Ended March 31,
(In millions, except per share amounts)20232022
Net sales
Product sales$4,686 $4,170 
Service sales587 484 
Total Net sales5,273 4,654 
Costs and expenses
Cost of products sold(3,458)(2,998)
Cost of services sold(437)(363)
Research and development(139)(125)
Selling, general and administrative(721)(601)
Total Costs and expenses(4,755)(4,087)
Equity method investment net earnings44 58 
Other income (expense), net(7)1,112 
Operating profit555 1,737 
Non-service pension (expense) benefit  (1)
Interest (expense) income, net(46)(48)
Income from operations before income taxes509 1,688 
Income tax (expense) benefit(122)(301)
Net income from operations387 1,387 
Less: Non-controlling interest in subsidiaries' earnings from operations14 8 
Net income attributable to common shareowners$373 $1,379 
Earnings per share
Basic$0.45 $1.62 
Diluted $0.44 $1.58 
Weighted-average number of shares outstanding
Basic835.0 853.3 
Diluted852.2 874.1 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.

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CARRIER GLOBAL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)

 Three Months Ended March 31,
(In millions)20232022
Net income from operations$387 $1,387 
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments arising during period54 (61)
Pension and post-retirement benefit plan adjustments (2)
Chubb divestiture (245)
Other comprehensive income (loss), net of tax54 (308)
Comprehensive income (loss)441 1,079 
Less: Comprehensive income (loss) attributable to non-controlling interest16 8 
Comprehensive income (loss) attributable to common shareowners$425 $1,071 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.

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CARRIER GLOBAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
As of
(In millions)March 31, 2023December 31, 2022
Assets
Cash and cash equivalents$3,347 $3,520 
Accounts receivable, net3,032 2,833 
Contract assets, current568 537 
Inventories, net2,803 2,640 
Other assets, current408 349 
Total current assets10,158 9,879 
Future income tax benefits639 612 
Fixed assets, net2,277 2,241 
Operating lease right-of-use assets625 642 
Intangible assets, net1,287 1,342 
Goodwill9,987 9,977 
Pension and post-retirement assets29 26 
Equity method investments1,103 1,148 
Other assets306 219 
Total Assets$26,411 $26,086 
Liabilities and Equity
Accounts payable$2,926 $2,833 
Accrued liabilities2,374 2,610 
Contract liabilities, current516 449 
Current portion of long-term debt142 140 
Total current liabilities5,958 6,032 
Long-term debt8,708 8,702 
Future pension and post-retirement obligations354 349 
Future income tax obligations581 568 
Operating lease liabilities506 529 
Other long-term liabilities1,836 1,830 
Total Liabilities17,943 18,010 
Commitments and contingent liabilities (Note 19)
Equity
Common stock 9 9 
Treasury stock(1,972)(1,910)
Additional paid-in capital5,494 5,481 
Retained earnings6,239 5,866 
Accumulated other comprehensive loss(1,636)(1,688)
Non-controlling interest334 318 
Total Equity8,468 8,076 
Total Liabilities and Equity$26,411 $26,086 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.
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CARRIER GLOBAL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Unaudited)

(In millions)Accumulated Other Comprehensive Income (Loss)Common StockTreasury StockAdditional Paid-In CapitalRetained EarningsNon-Controlling InterestTotal Equity
Balance as of December 31, 2022$(1,688)$9 $(1,910)$5,481 $5,866 $318 $8,076 
Net income— — — — 373 14 387 
Other comprehensive income (loss), net of tax52 — — — — 2 54 
Shares issued under incentive plans, net— — — (9)— — (9)
Stock-based compensation— — — 22 — — 22 
Treasury stock repurchase— — (62)— — — (62)
Balance as of March 31, 2023$(1,636)$9 $(1,972)$5,494 $6,239 $334 $8,468 
(In millions)Accumulated Other Comprehensive Income (Loss)Common StockTreasury StockAdditional Paid-In CapitalRetained EarningsNon-Controlling InterestTotal Equity
Balance as of December 31, 2021$(989)$9 $(529)$5,411 $2,865 $327 $7,094 
Net income— — — — 1,379 8 1,387 
Other comprehensive income (loss), net of tax(308)— — — — — (308)
Shares issued under incentive plans, net— — — (17)— — (17)
Stock-based compensation— — — 21 — — 21 
Dividends attributable to non-controlling interest— — — — — (1)(1)
Sale of non-controlling interest— — — — — (5)(5)
Treasury stock repurchase— — (741)— — — (741)
Balance as of March 31, 2022$(1,297)$9 $(1,270)$5,415 $4,244 $329 $7,430 

The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.
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CARRIER GLOBAL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 Three Months Ended March 31,
(In millions)20232022
Operating Activities
Net income from operations$387 $1,387 
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization136 79 
Deferred income tax provision(24)48 
Stock-based compensation costs22 21 
Equity method investment net earnings(44)(58)
(Gain) loss on extinguishment of debt (36)
(Gain) loss on sale of investments(16)(1,112)
Changes in operating assets and liabilities
Accounts receivable, net(157)(207)
Contract assets, current(28)(154)
Inventories, net(126)(390)
Other assets, current(60)(15)
Accounts payable and accrued liabilities(25)132 
Contract liabilities, current64 13 
Defined benefit plan contributions(6)(4)
Distributions from equity method investments3 11 
Other operating activities, net(6)83 
Net cash flows provided by (used in) operating activities120 (202)
Investing Activities
Capital expenditures(70)(56)
Investment in businesses, net of cash acquired (52)(9)
Dispositions of businesses 35 2,935 
Settlement of derivative contracts, net(18)(32)
Other investing activities, net5 (18)
Net cash flows provided by (used in) investing activities(100)2,820 
Financing Activities
Increase (decrease) in short-term borrowings, net10 (33)
Issuance of long-term debt5 14 
Repayment of long-term debt(2)(1,123)
Repurchases of common stock(62)(734)
Dividends paid on common stock(154)(129)
Other financing activities, net(10)(15)
Net cash flows provided by (used in) financing activities(213)(2,020)
Effect of foreign exchange rate changes on cash and cash equivalents20 (1)
Net increase (decrease) in cash and cash equivalents and restricted cash(173)597 
Cash, cash equivalents and restricted cash, beginning of period3,527 3,025 
Cash, cash equivalents and restricted cash, end of period3,354 3,622 
Less: restricted cash7 18 
Cash and cash equivalents, end of period$3,347 $3,604 
The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financial Statements.
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CARRIER GLOBAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1: DESCRIPTION OF THE BUSINESS

Carrier Global Corporation (the "Company") is the leading global provider of healthy, safe, sustainable and intelligent building and cold chain solutions with a focus on providing differentiated, digitally-enabled lifecycle solutions to its customers. The Company's portfolio includes industry-leading brands such as Carrier, Toshiba, Automated Logic, Carrier Transicold, Kidde, Edwards and LenelS2 that offer innovative heating, ventilating, air conditioning ("HVAC"), refrigeration, fire, security and building automation technologies to help make the world safer and more comfortable. The Company also provides a broad array of related building services, including audit, design, installation, system integration, repair, maintenance and monitoring. The Company's operations are classified into three segments: HVAC, Refrigeration and Fire & Security.

In the opinion of management, the accompanying Unaudited Condensed Consolidated Financial Statements contain all adjustments (which include normal recurring adjustments) necessary to state fairly the financial position, results of operations and cash flows for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") have been omitted pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"). The accompanying Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's Annual Report on Form 10-K for 2022 filed with the SEC on February 7, 2023 (the "2022 Form 10-K").

NOTE 2: BASIS OF PRESENTATION

The Unaudited Condensed Consolidated Financial Statements include all accounts of the Company and its wholly-owned and majority-owned subsidiaries in which it has control. Inter-company accounts and transactions have been eliminated. Related party transactions between the Company and its equity method investees have not been eliminated. Non-controlling interest represents a non-controlling investor's interests in the results of subsidiaries that the Company controls and consolidates.

Acquisition of Toshiba Carrier Corporation

On February 6, 2022, the Company entered into a binding agreement to acquire a majority ownership interest in Toshiba Carrier Corporation (“TCC”), a variable refrigerant flow ("VRF") and light commercial HVAC joint venture between Carrier and Toshiba Corporation. The acquisition was completed on August 1, 2022. As a result, the assets, liabilities and results of operations of TCC are consolidated in the accompanying Unaudited Condensed Consolidated Financial Statements as of the date of acquisition and reported within the Company’s HVAC segment. Upon closing, Toshiba Corporation retained a 5% ownership interest in TCC. See Note 15 Acquisitions for additional information.

Sale of Chubb Fire & Security Business

On July 26, 2021, the Company entered into a stock purchase agreement to sell its Chubb Fire and Security business ("Chubb") to APi Group Corporation ("APi"). Chubb, which was reported within the Company’s Fire & Security segment, delivered essential fire safety and security solutions from design and installation to monitoring, service and maintenance across more than 17 countries around the globe. The sale of Chubb was completed on January 3, 2022 (the "Chubb Sale"). See Note 16 - Divestitures for additional information.

Separation from United Technologies

On April 3, 2020 (the Distribution Date"), United Technologies Corporation, since renamed Raytheon Technologies Corporation ("UTC"), completed the spin-off of Carrier into an independent, publicly traded company (the "Separation") through a pro-rata distribution (the "Distribution") on a one-for-one basis of all of the outstanding shares of common stock of Carrier to UTC shareowners who held shares of UTC common stock as of the close of business on March 19, 2020, the record date of the Distribution. In connection with the Separation, the Company issued an aggregate principal balance of $11.0 billion of debt and transferred approximately $10.9 billion of cash to UTC on February 27, 2020 and March 27, 2020. On April 1, 2020 and April 2, 2020, the Company received cash contributions totaling $590 million from UTC related to the Separation.

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Recently Issued and Adopted Accounting Pronouncements

The Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") is the sole source of authoritative U.S. GAAP other than SEC issued rules and regulations that apply only to SEC registrants. The FASB issues Accounting Standards Updates ("ASU") to communicate changes to the codification. The Company considers the applicability and impact of all ASUs. ASUs pending adoption were assessed and determined to be either not applicable or not expected to have a material impact on the accompanying Unaudited Condensed Consolidated Financial Statements.

NOTE 3: INVENTORIES, NET

Inventories are stated at the lower of cost or estimated net realizable value. Cost is primarily determined based on the first-in, first-out inventory method ("FIFO") or average cost methods, which approximates current replacement cost. However, certain subsidiaries use the last-in, first-out inventory method ("LIFO").

Inventories, net consisted of the following:
(In millions)March 31, 2023December 31, 2022
Raw materials$881 $884 
Work-in-process292 230 
Finished goods1,630 1,526 
Inventories, net$2,803 $2,640 

The Company performs periodic assessments utilizing customer demand, production requirements and historical usage rates to determine the existence of excess and obsolete inventory and records necessary provisions to reduce such inventories to the lower of cost or estimated net realizable value. Raw materials, work-in-process and finished goods are net of valuation reserves of $221 million and $190 million as of March 31, 2023 and December 31, 2022, respectively.

NOTE 4: GOODWILL AND INTANGIBLE ASSETS

The Company records goodwill as the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is tested and reviewed annually for impairment on July 1 or whenever there is a material change in events or circumstances that indicates that the fair value of the reporting unit may be less than its carrying value.

The changes in the carrying amount of goodwill were as follows:

(In millions)HVACRefrigerationFire & SecurityTotal
Balance as of December 31, 2022$6,392 $1,197 $2,388 $9,977 
Acquisitions / divestitures(13)(4) (17)
Foreign currency translation16 3 8 27 
Balance as of March 31, 2023$6,395 $1,196 $2,396 $9,987 

Indefinite-lived intangible assets are tested and reviewed annually for impairment on July 1 or whenever there is a material change in events or circumstances that indicates that the fair value of the asset may be less than the carrying amount of the asset. All other intangible assets with finite useful lives are amortized over their estimated useful lives.

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Identifiable intangible assets consisted of the following:

March 31, 2023December 31, 2022
(In millions)Gross AmountAccumulated AmortizationNet AmountGross AmountAccumulated AmortizationNet Amount
Amortized:
Customer relationships$1,426 $(734)$692 $1,431 $(720)$711 
Patents and trademarks404 (199)205 401 (191)210 
Service portfolios and other956 (630)326 953 (595)358 
2,786 (1,563)1,223 2,785 (1,506)1,279 
Unamortized:
Trademarks and other64 — 64 63 — 63 
Intangible assets, net$2,850 $(1,563)$1,287 $2,848 $(1,506)$1,342 

Amortization of intangible assets was as follows:

 Three Months Ended March 31,
(In millions)20232022
Amortization expense of Intangible assets$64 $21 
NOTE 5: BORROWINGS AND LINES OF CREDIT

Long-term debt consisted of the following:

(In millions)March 31,
2023
December 31,
2022
2.242% Notes due February 15, 2025
$1,200 $1,200 
2.493% Notes due February 15, 2027
900 900 
2.722% Notes due February 15, 2030
2,000 2,000 
2.700% Notes due February 15, 2031
750 750 
3.377% Notes due April 5, 2040
1,500 1,500 
3.577% Notes due April 5, 2050
2,000 2,000 
Total long-term notes8,350 8,350 
Japanese Term Loan Facility408 404 
Other debt (including project financing obligations and finance leases)152 149 
Discounts and debt issuance costs(60)(61)
Total debt8,850 8,842 
Less: current portion of long-term debt142 140 
Long-term debt, net of current portion$8,708 $8,702 
Japanese Term Loan Facility

On July 15, 2022, the Company entered into a five-year, JPY 54 billion (approximately $400 million) senior unsecured term loan facility with MUFG Bank Ltd., as administrative agent and lender, and certain other lenders (the "Japanese Term Loan Facility"). Borrowings under the Japanese Term Loan Facility bear interest at a rate equal to the Tokyo Term Risk Free Rate plus 0.75%. In addition, the Japanese Term Loan Facility is subject to customary covenants including a covenant to maintain a maximum consolidated leverage ratio. On July 25, 2022, the Company borrowed JPY 54 billion under the Japanese Term Loan Facility and used the proceeds to fund a portion of the TCC acquisition and to pay related fees and expenses.
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Revolving Credit Facility

On February 10, 2020, the Company entered into a revolving credit agreement with various banks permitting aggregate borrowings of up to $2.0 billion pursuant to an unsecured, unsubordinated revolving credit facility that matures on April 3, 2025 (the "Revolving Credit Facility"). The Revolving Credit Facility supports the Company's commercial paper program and cash requirements. A commitment fee of 0.125% is charged on unused commitments. Borrowings under the Revolving Credit Facility are available in U.S. Dollars, Euros and Pounds Sterling. Pounds Sterling borrowings bear interest at a variable rate based on daily simple SONIA plus 0.0326%, Euro borrowings bear interest at EURIBOR rates and U.S. Dollar borrowings bear interest at LIBOR plus a ratings-based margin, which was 125 basis points as of March 31, 2023. As of March 31, 2023, there were no borrowings outstanding under the Revolving Credit Facility.

Commercial Paper Program

The Company has a $2.0 billion unsecured, unsubordinated commercial paper program, which can be used for general corporate purposes, including the funding of working capital and potential acquisitions. As of March 31, 2023, there were no borrowings outstanding under the commercial paper program.

Project Financing Arrangements

The Company is involved in long-term construction contracts in which it arranges project financing with certain customers. As a result, the Company issued $5 million and $14 million of debt during the three months ended March 31, 2023 and 2022, respectively. Long-term debt repayments associated with these financing arrangements during the three months ended March 31, 2023 and 2022 were $2 million and $8 million, respectively.

Debt Covenants

The Revolving Credit Facility, the indenture for the long-term notes and the Japanese Term Loan Facility contain affirmative and negative covenants customary for financings of these types, which, among other things, limit the Company's ability to incur additional liens, to make certain fundamental changes and to enter into sale and leaseback transactions. As of March 31, 2023, the Company was in compliance with the covenants under the agreements governing its outstanding indebtedness.

Tender Offers

On March 15, 2022, the Company commenced tender offers to purchase up to $1.15 billion ("Aggregate Tender Cap") aggregate principal of the Company's 2.242% Notes due 2025 and 2.493% Notes due 2027 (together, the "Senior Notes"). The tender offers included payment of applicable accrued and unpaid interest up to the settlement date, along with a fixed spread for early repayment. Based on participation, the Company elected to settle the tender offers on March 30, 2022. The aggregate principal amount of Senior Notes validly tendered and accepted was approximately $1.15 billion, which included $800 million of Notes due 2025 and $350 million of Notes due 2027. As a result, the Company recognized a net gain of $33 million and wrote off $5 million of unamortized deferred financing costs within Interest (expense) income, net on the accompanying Unaudited Condensed Consolidated Statement of Operations during the three months ended March 31, 2022.

NOTE 6: FAIR VALUE MEASUREMENTS

ASC 820, Fair Value Measurement ("ASC 820"), defines fair value as the price that would be received if an asset is sold or the price paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a three-level fair value hierarchy that prioritizes information used in developing assumptions when pricing an asset or liability as follows:

Level 1: Observable inputs such as quoted prices in active markets;
Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
Level 3: Unobservable inputs where there is little or no market data, which requires the reporting entity to develop its own assumptions.

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ASC 820 requires the use of observable market data, when available, in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

In the normal course of business, the Company is exposed to certain risks arising from business operations and economic factors, including foreign currency and commodity price risk. These exposures are managed through operational strategies and the use of undesignated hedging contracts. The Company's derivative assets and liabilities are measured at fair value on a recurring basis using internal models based on observable market inputs, such as forward, interest, contract and discount rates with changes in fair value reported in earnings in the accompanying Unaudited Condensed Consolidated Statement of Operations.

In connection with the TCC acquisition, the Company funded a portion of the Yen-denominated purchase price with cash on hand by entering into cross currency swaps with SMBC Capital Markets, Inc. as syndication swap arranger, and certain other financial institutions. The fair value of the cross currency swaps are measured at fair value on a recurring basis using observable market inputs, such as forward, discount and interest rates as well as credit default swap spreads. The Company designated the cross currency swaps as a partial hedge of its investment in certain subsidiaries whose functional currency is the Japanese Yen in order to manage foreign currency translation risk. As a result, changes in the fair value of the swaps are recorded in Equity in the accompanying Unaudited Condensed Consolidated Balance Sheet.

The remaining portion of the Yen-denominated purchase price was funded by the Japanese Term Loan Facility. The carrying value of the facility is translated on a recurring basis using the exchange rate at the end of the applicable period and approximates its fair value. The Company designated the Japanese Term Loan Facility as a partial hedge of its investment in certain subsidiaries whose functional currency is the Japanese Yen in order to manage foreign currency translation risk. As a result, changes in the carrying value of the Japanese Term Loan Facility associated with foreign exchange rate movements are recorded in Equity in the Unaudited Condensed Consolidated Balance Sheet.

The following tables provide the valuation hierarchy classification of assets and liabilities that are recorded at fair value and measured on a recurring basis in the accompanying Unaudited Condensed Consolidated Balance Sheet:

(In millions)TotalLevel 1Level 2Level 3
March 31, 2023
Derivative assets (1)(3)
$20 $ $20 $ 
Derivative liabilities (2)(3)
$(71)$ $(71)$ 
December 31, 2022
Derivative assets (1) (3)
$28 $ $28 $ 
Derivative liabilities (2) (3)
$(48)$ $(48)$ 
(1) Included in Other assets, current on the accompanying Unaudited Condensed Consolidated Balance Sheet.
(2) Included in Accrued liabilities on the accompanying Unaudited Condensed Consolidated Balance Sheet.
(3) Includes cross currency swaps.

The following table provides the carrying amounts and fair values of the Company's long-term notes that are not recorded at fair value in the accompanying Unaudited Condensed Consolidated Balance Sheet:

March 31, 2023December 31, 2022
(In millions)Carrying
Amount
Fair
Value
Carrying
Amount
Fair
Value
Total long-term Notes (1)
$8,350 $7,105 $8,350 $6,832 
(1) Excludes debt discount and issuance costs.

The fair value of the Company's long-term debt is measured based on observable market inputs which are considered Level 1 within the fair value hierarchy. The carrying value of cash and cash equivalents, accounts receivable, accounts payable and short-term borrowings approximate fair value due to the short-term nature of these accounts and would be classified as Level 1 in the fair value hierarchy. The Company's financing leases and project financing obligations, included in Long-term debt and
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Current portion of long-term debt on the accompanying Unaudited Condensed Consolidated Balance Sheet, approximate fair value and are classified as Level 3 in the fair value hierarchy.

NOTE 7: EMPLOYEE BENEFIT PLANS

The Company sponsors both funded and unfunded domestic and international defined benefit pension and defined contribution plans. In addition, the Company contributes to various domestic and international multi-employer pension plans.

Contributions to the plans were as follows:

 Three Months Ended March 31,
(In millions)20232022
Defined benefit plans$6 $4 
Defined contribution plans$37 $38 
Multi-employer pension plans$4 $3 

The components of net periodic pension expense (benefit) for the defined benefit pension plans are as follows:

 Three Months Ended March 31,
(In millions)20232022
Service cost$4 $5 
Interest cost8 4 
Expected return on plan assets(8)(7)
Amortization of prior service credit 1 
Recognized actuarial net (gain) loss 2 
Net periodic pension expense (benefit)$4 $5 

NOTE 8: STOCK-BASED COMPENSATION

The Company accounts for stock-based compensation plans in accordance with ASC 718, Compensation - Stock Compensation, which requires a fair-value based method for measuring the value of stock-based compensation. Fair value is measured at the date of grant and is generally not adjusted for subsequent changes. The Company's stock-based compensation plans include programs for stock appreciation rights, restricted stock units and performance share units.

Stock-based compensation expense, net of estimated forfeitures, is included in Cost of products sold, Selling, general and administrative and Research and development in the accompanying Unaudited Condensed Consolidated Statements of Operations.

Stock-based compensation cost by award type was as follows:
 Three Months Ended March 31,
(In millions)20232022
Equity compensation costs - equity settled$22 $21 
Equity compensation costs - cash settled (1)
1 (6)
Total stock-based compensation expense$23 $15 
(1) The cash settled awards are classified as liability awards and are measured at fair value at each balance sheet date.

NOTE 9: PRODUCT WARRANTIES

In the ordinary course of business, the Company provides standard warranty coverage on its products. Provisions for these amounts are established at the time of sale and estimated primarily based on product warranty terms and historical claims
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experience. In addition, the Company incurs discretionary costs to service its products in connection with specific product performance issues. Provisions for these amounts are established when they are known and estimable. The Company assesses the adequacy of its initial provisions and will make adjustments as necessary based on known or anticipated claims or as new information becomes available that suggests it is probable that future costs will be different than estimated amounts. Amounts associated with these provisions are classified on the accompanying Unaudited Condensed Consolidated Balance Sheet as Accrued liabilities or Other long-term liabilities based on their anticipated settlement date.

The changes in the carrying amount of warranty related provisions are as follows:
Three Months Ended March 31,
(In millions)20232022
Balance as of January 1,$552 $524 
Warranties, performance guarantees issued and changes in estimated liability54 45 
Settlements made(45)(43)
Other2  
Balance as of March 31,$563 $526 

NOTE 10: EQUITY

The authorized number of shares of common stock of Carrier is 4,000,000,000 shares of $0.01 par value. As of March 31, 2023 and December 31, 2022, 878,272,100 and 876,487,480 shares of common stock were issued, respectively, which includes 43,490,981 and 42,103,995 shares of treasury stock, respectively.

Share Repurchase Program

The Company may repurchase its outstanding common stock from time to time subject to market conditions and at the Company's discretion. Repurchases occur in the open market or through one or more other public or private transactions pursuant to plans complying with Rules 10b5-1 and 10b-18 under the Exchange Act. Shares acquired are recognized at cost and presented separately on the balance sheet as a reduction to Equity. Since the initial authorization in February 2021, the Company's Board of Directors authorized the repurchase of up to $4.1 billion of the Company's outstanding common stock. As of December 31, 2022, the Company repurchased 42.1 million shares of common stock for an aggregate purchase price of $1.9 billion, including shares repurchased under an accelerated share repurchase agreement. As a result, the Company had approximately $2.2 billion remaining under the current authorization at December 31, 2022.

During the three months ended March 31, 2023, the Company repurchased 1.4 million shares of common stock for an aggregate purchase price of $62 million. As a result, the Company has approximately $2.1 billion remaining under the current authorization at March 31, 2023.

Accumulated Other Comprehensive Income (Loss)

A summary of changes in the components of Accumulated other comprehensive income (loss) for the three months ended March 31, 2023 is as follows:
(In millions)Foreign Currency TranslationDefined Benefit Pension and Post-retirement PlansAccumulated Other Comprehensive Income (Loss)
Balance as of December 31, 2022$(1,604)$(84)$(1,688)
Other comprehensive income (loss) before reclassifications, net52  52 
Amounts reclassified, pre-tax   
Tax expense (benefit) reclassified   
Balance as of March 31, 2023$(1,552)$(84)$(1,636)

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A summary of changes in the components of Accumulated other comprehensive income (loss) for the three months ended March 31, 2022 is as follows:
(In millions)Foreign Currency TranslationDefined Benefit Pension and Post-retirement PlansAccumulated Other Comprehensive Income (Loss)
Balance as of December 31, 2021$(505)$(484)$(989)
Other comprehensive income (loss) before reclassifications, net(61)(4)(65)
Amounts reclassified, pre-tax 3 3 
Tax expense (benefit) reclassified (1)(1)
Chubb divestiture(574)329 (245)
Balance as of March 31, 2022$(1,140)$(157)$(1,297)