Company: LIN
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001628280-25-021379
Chunk: 50

Company: LINDE PLC
Filing Date: 2025-05-01
Form: 10-Q
Item: Item 8
Chunk 50
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 from a packaged gas facility or retail store and the company has the right to payment from the customer in accordance with the contract terms. Engineering The company designs and manufactures equipment for air separation and other industrial gas applications manufactured specifically for end customers. Sale of equipment contracts are generally comprised of a single performance obligation. Revenue from sale of equipment is generally recognized over time as Linde has an enforceable right to payment for 

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performance completed to date and performance does not create an asset with alternative use. For contracts recognized over time, revenue is recognized primarily using a cost incurred input method. Costs incurred to date relative to total estimated costs at completion are used to measure progress toward satisfying performance obligations. Costs incurred include material, labor, and overhead costs and represent work contributing and proportionate to the transfer of control to the customer. Changes to cost estimates and contract modifications are typically accounted for as part of the existing contract and are recognized as cumulative adjustments for the inception-to-date effect of such change.Contract Assets and LiabilitiesContract assets and liabilities result from differences in timing of revenue recognition and customer invoicing. Contract assets primarily relate to sale of equipment contracts for which revenue is recognized over time. The balance represents unbilled revenue which occurs when revenue recognized under the measure of progress exceeds amounts invoiced to customers. Customer invoices may be based on the passage of time, the achievement of certain contractual milestones or a combination of both criteria. Contract liabilities include advance payments or right to consideration prior to performance under the contract. Contract liabilities are recognized as revenue as performance obligations are satisfied under contract terms. Linde has contract assets of  $338 million at March 31, 2025 (current contract assets of $293 million and $45 million within other long-term assets in the condensed consolidated balance sheet). Total contract assets were $263 million at December 31, 2024, all classified as current contract assets in the condensed consolidated balance sheet. Total contract liabilities are $2,399 million at March 31, 2025 (current contract liabilities of $1,196 million and $1,203 million within other long-term liabilities in the condensed consolidated balance sheet). Total contract liabilities were $2,292 million at December 31, 2024 (current contract liabilities of $1,194 million and $1,098 million within other long-term liabilities in the condensed consolidated balance sheet). Revenue recognized for the three months ended March 31, 2025 that was included in the contract liability at December 31, 2024 was $380 million. Contract