Allison Transmission Holdings Inc Segments Disclosure
NOTE 23. SEGMENT INFORMATION
In accordance with the FASB’s authoritative accounting guidance on segment reporting, the Company had one operating segment and reportable segment as of December 31, 2025. The Company was managed by the Chief Operating Decision Maker ("CODM") based on its one line of business, the design, manufacture and distribution of vehicle propulsion solutions.
The Company’s CODM is its . The CODM evaluates Company performance and makes decisions on the allocation of resources based on Net income, a GAAP measure, and Adjusted Earnings before Interest, Taxes, Depreciation, and Amortization (“EBITDA”), a non-GAAP measure. The most directly comparable GAAP measure to Adjusted EBITDA is Net income. The Company believes that Net income and Adjusted EBITDA provide management, investors and creditors with useful measures of the operational results of its business and increase the period-to-period comparability of the Company's operating profitability and comparability with other companies.
The CODM assesses Company performance utilizing Net income and Adjusted EBITDA by comparing budget versus actual and year-over-year variances. Certain variances identified in the analysis of Net income and Adjusted EBITDA are evaluated to assist the CODM in assessing Company performance and making decisions on the allocation of Company resources. The following expenses included in Net income and Adjusted EBITDA are identified as significant expenses regularly provided to the CODM: Cost of sales, Selling, general and administrative, and Engineering — research and development.
The Company’s one reportable segment as of December 31, 2025 was the same as its consolidated financial results; therefore, segment information for additions of long-lived assets and asset information can be found in the Company’s Consolidated Statements of Cash Flows and Consolidated Balance Sheets, respectively.
The following presents a financial summary of the Company’s one reportable segment (dollars in millions):
|
Years ended December 31 |
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|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Net sales |
$ |
3,010 |
|
|
$ |
3,225 |
|
|
$ |
3,035 |
|
less: |
|
|
|
|
|
|
|
|
|||
Cost of sales |
|
1,547 |
|
|
|
1,696 |
|
|
|
1,565 |
|
Selling, general and administrative |
|
380 |
|
|
|
336 |
|
|
|
357 |
|
Engineering — research and development |
|
174 |
|
|
|
200 |
|
|
|
194 |
|
Other segment items (a) |
|
286 |
|
|
|
262 |
|
|
|
246 |
|
Net income |
|
623 |
|
|
|
731 |
|
|
|
673 |
|
plus: |
|
|
|
|
|
|
|
|
|||
Income tax expense |
|
181 |
|
|
|
166 |
|
|
|
154 |
|
Depreciation of property, plant and equipment |
|
117 |
|
|
|
111 |
|
|
|
109 |
|
Interest expense, net |
|
92 |
|
|
|
89 |
|
|
|
107 |
|
Amortization of intangible assets |
|
7 |
|
|
|
10 |
|
|
|
45 |
|
Other adjustments (b) |
|
110 |
|
|
|
58 |
|
|
|
20 |
|
Adjusted EBITDA |
$ |
1,130 |
|
|
$ |
1,165 |
|
|
$ |
1,108 |
|
Total assets |
$ |
6,082 |
|
|
$ |
5,336 |
|
|
$ |
5,025 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 24, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.