UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, ~~2020~~2021


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 001-35907

IQVIA HOLDINGS INC.

(Exact name of registrant as specified in its charter)

_________________________________________________________


Delaware						27-1341991
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)

4820 Emperor Blvd., Durham, North Carolina 27703

~~and~~

~~83 Wooster Heights Road, Danbury, Connecticut 06810~~

(Address of principal executive ~~offices~~office and Zip Code)

(919) 998-2000 ~~and (203) 448-4600~~

(Registrant’s telephone number, including area code)

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 x 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 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x 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	x	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging 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 x

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on which Registered

Common Stock, par value $0.01 per share

IQV

New York Stock Exchange

Indicate the number of shares outstanding of each of the issuer’s classes of Common Stock, as of the latest practicable date.

Class

Number of Shares Outstanding

Common Stock $0.01 par value

~~191,725,778~~191,039,501

shares outstanding

as of October ~~16, 2020~~20, 2021

Table of contents

IQVIA HOLDINGS INC.

FORM 10-Q

TABLE OF CONTENTS


		Page
PART I—FINANCIAL INFORMATION			3

Item 1.	Financial Statements (unaudited)	3

	Condensed Consolidated Statements of Income for the three and nine months ended September 30, ~~2020~~2021 and ~~2019~~2020	3

	Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, ~~2020~~2021 and ~~2019~~2020	4

	Condensed Consolidated Balance Sheets as of ~~September~~Septe mber 30, ~~2020~~2021 and December 31, ~~2019~~2020	5

	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, ~~2020~~2021 and ~~2019~~2020	6

	Condensed Consolidated Statements of Stockholders’ Equity for three and nine months ended September 30, ~~2020~~2021 and ~~2019~~2020	7

	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3332

Item 4.	Controls and Procedures	3332


PART II—OTHER INFORMATION			34

Item 1.	Legal Proceedings	34

Item 1A.	Risk Factors	34

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 6.	Exhibits	36

SIGNATURES			37

Table of contents

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

IQVIA HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

Three Months Ended September 30, Nine Months Ended September 30,
(in millions, except per share data) 2020 2019 2020 2019
Revenues $ 2,786 $ 2,769 $ 8,061 $ 8,193
Costs of revenue, exclusive of depreciation and amortization 1,800 1,852 5,328 5,399
Selling, general and administrative expenses 460 395 1,298 1,250
Depreciation and amortization 319 299 943 888
Restructuring costs 20 19 50 45
Income from operations 187 204 442 611
Interest income (1) (3) (4) (7)
Interest expense 100 114 314 338
Loss on extinguishment of debt 0 24 12 24
Other income, net (14) 0 (59) 0
Income before income taxes and equity in earnings of unconsolidated affiliates 102 69 179 256
Income tax (benefit) expense (3) (1) 9 48
Income before equity in earnings of unconsolidated affiliates 105 70 170 208
Equity in earnings (loss) of unconsolidated affiliates 3 (1) 8 (1)
Net income 108 69 178 207
Net income attributable to non-controlling interests (7) (12) (18) (32)
Net income attributable to IQVIA Holdings Inc. $ 101 $ 57 $ 160 $ 175
Earnings per share attributable to common stockholders:
Basic $ 0.53 $ 0.29 $ 0.84 $ 0.89
Diluted $ 0.52 $ 0.29 $ 0.82 $ 0.87
Weighted average common shares outstanding:
Basic 191.3 194.5 191.3 195.9
Diluted 194.9 199.0 194.9 200.5


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions, except per share data)	2021		2020		2021		2020
Revenues	$	3,391	$	2,786	$	10,238	$	8,061
Costs of revenue, exclusive of depreciation and amortization	2,253		1,800		6,869		5,328
Selling, general and administrative expenses	498		460		1,422		1,298
Depreciation and amortization	336		319		1,002		943
Restructuring costs	2		20		15		50
Income from operations	302		187		930		442
Interest income	(2)		(1)		(4)		(4)
Interest expense	92		100		285		314
Loss on extinguishment of debt	1		—		25		12
Other income, net	(62)		(14)		(128)		(59)
Income before income taxes and equity in earnings of unconsolidated affiliates	273		102		752		179
Income tax expense (benefit)	12		(3)		104		9
Income before equity in earnings of unconsolidated affiliates	261		105		648		170
Equity in earnings of unconsolidated affiliates	—		3		5		8
Net income	261		108		653		178
Net income attributable to non-controlling interests	—		(7)		(5)		(18)
Net income attributable to IQVIA Holdings Inc.	$	261	$	101	$	648	$	160
Earnings per share attributable to common stockholders:
Basic	$	1.36	$	0.53	$	3.38	$	0.84
Diluted	$	1.34	$	0.52	$	3.32	$	0.82
Weighted average common shares outstanding:
Basic	191.5		191.3		191.5		191.3
Diluted	195.3		194.9		195.0		194.9

The accompanying notes are an integral part of these condensed consolidated financial statements.

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IQVIA HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ~~(LOSS)~~

(unaudited)

Three Months Ended
September 30, Nine Months Ended
September 30,
(in millions) 2020 2019 2020 2019
Net income $ 108 $ 69 $ 178 $ 207
Comprehensive income (loss) adjustments:
Unrealized (losses) gains on derivative instruments, net of income tax (benefit) expense of $(8), $(2), $(11), $(7) (1) (5) (33) (23)
Foreign currency translation, net of income tax expense (benefit) of $(54), $57, $(83), $65 130 (162) 20 (131)
Reclassification adjustments:
Losses (gains) on derivative instruments included in net income, net of income tax expense (benefit) of $1, $0, $2, $(1) 2 2 6 (2)
Comprehensive income (loss) 239 (96) 171 51
Comprehensive income attributable to non-controlling interests (11) (9) (17) (29)
Comprehensive income (loss) attributable to IQVIA Holdings Inc. $ 228 $ (105) $ 154 $ 22


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Net income	$	261	$	108	$	653	$	178
Comprehensive income adjustments:
Unrealized (losses) gains on derivative instruments, net of income tax expense (benefit) of $—, $(8), $—, $(11)	(4)		(1)		—		(33)
Foreign currency translation, net of income tax (benefit) expense of $28, $(54), $66, $(83)	(117)		130		(237)		20
Reclassification adjustments:
Losses on derivative instruments included in net income, net of income tax benefit of $1, $1, $2, $2	3		2		7		6
Comprehensive income	143		239		423		171
Comprehensive income attributable to non-controlling interests	—		(11)		(5)		(17)
Comprehensive income attributable to IQVIA Holdings Inc.	$	143	$	228	$	418	$	154

The accompanying notes are an integral part of these condensed consolidated financial statements.

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IQVIA HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(in millions, except per share data) September 30, 2020 December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents $ 1,464 $ 837
Trade accounts receivable and unbilled services, net 2,414 2,582
Prepaid expenses 165 138
Income taxes receivable 78 56
Investments in debt, equity and other securities 79 62
Other current assets and receivables 445 451
Total current assets 4,645 4,126
Property and equipment, net 452 458
Operating lease right-of-use assets 490 496
Investments in debt, equity and other securities 78 65
Investments in unconsolidated affiliates 85 87
Goodwill 12,363 12,159
Other identifiable intangibles, net 5,222 5,514
Deferred income taxes 125 119
Deposits and other assets 377 227
Total assets $ 23,837 $ 23,251
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 2,461 $ 2,512
Unearned income 1,188 1,014
Income taxes payable 101 108
Current portion of long-term debt 144 100
Other current liabilities 245 211
Total current liabilities 4,139 3,945
Long-term debt 12,195 11,545
Deferred income taxes 429 646
Operating lease liabilities 387 396
Other liabilities 580 456
Total liabilities 17,730 16,988
Commitments and contingencies
Stockholders’ equity:
Common stock and additional paid-in capital, 400.0 shares authorized at September 30, 2020 and December 31, 2019, $0.01 par value, 254.5 shares issued and 191.7 shares outstanding at September 30, 2020; 253.0 shares issued and 192.3 shares outstanding at December 31, 2019 11,070 11,049
Retained earnings 1,158 998
Treasury stock, at cost, 62.8 and 60.7 shares at September 30, 2020 and December 31, 2019, respectively (6,065) (5,733)
Accumulated other comprehensive loss (317) (311)
Equity attributable to IQVIA Holdings Inc.’s stockholders 5,846 6,003
Non-controlling interests 261 260
Total stockholders’ equity 6,107 6,263
Total liabilities and stockholders’ equity $ 23,837 $ 23,251


(in millions, except per share data)	September 30, 2021		December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	1,470	$	1,814
Trade accounts receivable and unbilled services, net	2,330		2,410
Prepaid expenses	164		159
Income taxes receivable	56		56
Investments in debt, equity and other securities	104		88
Other current assets and receivables	410		563
Total current assets	4,534		5,090
Property and equipment, net	485		482
Operating lease right-of-use assets	404		471
Investments in debt, equity and other securities	74		78
Investments in unconsolidated affiliates	84		84
Goodwill	13,124		12,654
Other identifiable intangibles, net	4,812		5,205
Deferred income taxes	105		114
Deposits and other assets	411		386
Total assets	$	24,033	$	24,564
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	2,663	$	2,813
Unearned income	1,826		1,252
Income taxes payable	53		102
Current portion of long-term debt	91		149
Other current liabilities	214		242
Total current liabilities	4,847		4,558
Long-term debt, less current portion	12,081		12,384
Deferred income taxes	297		338
Operating lease liabilities	323		371
Other liabilities	656		633
Total liabilities	18,204		18,284
Commitments and contingencies (Note 8)	0		0
Stockholders’ equity:
Common stock and additional paid-in capital, 400.0 shares authorized as of September 30, 2021 and December 31, 2020, $0.01 par value, 255.6 shares issued and 191.1 shares outstanding as of September 30, 2021; 254.7 shares issued and 191.2 shares outstanding as of December 31, 2020	10,747		11,095
Retained earnings	1,925		1,277
Treasury stock, at cost, 64.5 and 63.5 shares as of September 30, 2021 and December 31, 2020, respectively	(6,398)		(6,166)
Accumulated other comprehensive loss	(445)		(205)
Equity attributable to IQVIA Holdings Inc.’s stockholders	5,829		6,001
Non-controlling interests	—		279
Total stockholders’ equity	5,829		6,280
Total liabilities and stockholders’ equity	$	24,033	$	24,564

The accompanying notes are an integral part of these condensed consolidated financial statements.

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IQVIA HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

Nine Months Ended September 30,
(in millions) 2020 2019
Operating activities:
Net income $ 178 $ 207
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization 943 888
Amortization of debt issuance costs and discount 13 10
Stock-based compensation 69 87
(Earnings) loss from unconsolidated affiliates (8) 1
Gain on investments, net (17) 0
Benefit from deferred income taxes (160) (154)
Changes in operating assets and liabilities:
Change in accounts receivable, unbilled services and unearned income 328 (167)
Change in other operating assets and liabilities (137) (38)
Net cash provided by operating activities 1,209 834
Investing activities:
Acquisition of property, equipment and software (440) (445)
Acquisition of businesses, net of cash acquired (118) (461)
Purchases of marketable securities, net (8) (2)
Investments in unconsolidated affiliates, net of payments received 8 3
Investments in equity securities (2) (10)
Other 0 5
Net cash used in investing activities (560) (910)
Financing activities:
Proceeds from issuance of debt 1,591 1,900
Payment of debt issuance costs (33) (47)
Repayment of debt and principal payments on capital lease obligations (792) (875)
Proceeds from revolving credit facility 1,250 1,710
Repayment of revolving credit facility (1,610) (1,930)
(Payments) proceeds related to employee stock option plans (43) 15
Repurchase of common stock (346) (679)
Distributions to non-controlling interests, net (16) (6)
Contingent consideration and deferred purchase price payments (20) (21)
Net cash (used in) provided by financing activities (19) 67
Effect of foreign currency exchange rate changes on cash (3) (19)
Increase (decrease) in cash and cash equivalents 627 (28)
Cash and cash equivalents at beginning of period 837 891
Cash and cash equivalents at end of period $ 1,464 $ 863


	Nine Months Ended September 30,
(in millions)	2021		2020
Operating activities:
Net income	$	653	$	178
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	1,002		943
Amortization of debt issuance costs and discount	14		13
Stock-based compensation	128		69
Earnings from unconsolidated affiliates	(5)		(8)
Gain on investments, net	(9)		(17)
Benefit from deferred income taxes	(83)		(160)
Changes in operating assets and liabilities:
Change in accounts receivable, unbilled services and unearned income	663		328
Change in other operating assets and liabilities	(113)		(137)
Net cash provided by operating activities	2,250		1,209
Investing activities:
Acquisition of property, equipment and software	(456)		(440)
Acquisition of businesses, net of cash acquired	(994)		(118)
Purchases of marketable securities, net	(9)		(8)
Investments in unconsolidated affiliates, net of payments received	(3)		8
Proceeds from sale of (investments in) equity securities	5		(2)
Other	1		—
Net cash used in investing activities	(1,456)		(560)
Financing activities:
Proceeds from issuance of debt	1,951		1,591
Payment of debt issuance costs	(40)		(33)
Repayment of debt and principal payments on finance leases	(2,068)		(792)
Proceeds from revolving credit facility	410		1,250
Repayment of revolving credit facility	(300)		(1,610)
(Payments) related to employee stock option plans	(51)		(43)
Repurchase of common stock	(202)		(346)
Distributions to non-controlling interest, net	—		(16)
Acquisition of Quest's non-controlling interest	(758)		—
Contingent consideration and deferred purchase price payments	(39)		(20)
Net cash used in financing activities	(1,097)		(19)
Effect of foreign currency exchange rate changes on cash	(41)		(3)
(Decrease) increase in cash and cash equivalents	(344)		627
Cash and cash equivalents at beginning of period	1,814		837
Cash and cash equivalents at end of period	$	1,470	$	1,464

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of contents

IQVIA HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited)


(in millions)	Common Stock Shares	Treasury Stock Shares	Common Stock		Additional Paid-In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive (Loss) Income		Non- controlling Interests		Total
Balance, December 31, 2020	254.7	(63.5)	$	3	$	11,092	$	1,277	$	(6,166)	$	(205)	$	279	$	6,280
Issuance of common stock	0.7	—	—		(57)		—		—		—		—		(57)
Repurchase of common stock	—	(0.3)	—		—		—		(62)		—		—		(62)
Stock-based compensation	—	—	—		30		—		—		—		—		30
Net income	—	—	—		—		212		—		—		5		217
Unrealized gains on derivative instruments, net of tax	—	—	—		—		—		—		6		—		6
Foreign currency translation, net of tax	—	—	—		—		—		—		(178)		—		(178)
Reclassification adjustments, net of tax	—	—	—		—		—		—		1		—		1
Balance, March 31, 2021	255.4	(63.8)	$	3	$	11,065	$	1,489	$	(6,228)	$	(376)	$	284	$	6,237
Issuance of common stock	0.2	—	—		1		—		—		—		—		1
Repurchase of common stock	—	(0.2)	—		—		—		(45)		—		—		(45)
Stock-based compensation	—	—	—		42		—		—		—		—		42
Acquisition of Quest's non-controlling interest, net of tax	—	—	—		(415)		—		—		(10)		(284)		(709)
Net income	—	—	—		—		175		—		—		—		175
Unrealized losses on derivative instruments, net of tax	—	—	—		—		—		—		(2)		—		(2)
Foreign currency translation, net of tax	—	—	—		—		—		—		58		—		58
Reclassification adjustments, net of tax	—	—	—		—		—		—		3		—		3
Balance, June 30, 2021	255.6	(64.0)	$	3	$	10,693	$	1,664	$	(6,273)	$	(327)	$	—	$	5,760
Issuance of common stock	—	—	—		4		—		—		—		—		4
Repurchase of common stock	—	(0.5)	—		—		—		(125)		—		—		(125)
Stock-based compensation	—	—	—		48		—		—		—		—		48
Acquisition of Quest's non-controlling interest, net of tax		—	—		(1)		—		—		—		—		(1)
Net income	—	—	—		—		261		—		—		—		261
Unrealized losses on derivative instruments, net of tax	—	—	—		—		—		—		(4)		—		(4)
Foreign currency translation, net of tax	—	—	—		—		—		—		(117)		—		(117)
Reclassification adjustments, net of tax	—	—	—		—		—		—		3		—		3
Balance, September 30, 2021	255.6	(64.5)	$	3	$	10,744	$	1,925	$	(6,398)	$	(445)	$	—	$	5,829

(in millions) Common
Stock
Shares Treasury
Stock
Shares Common
Stock Additional
Paid-In
Capital Retained Earnings Treasury
Stock Accumulated
Other
Comprehensive
(Loss) Income Non-
controlling
Interests Total
Balance, December 31, 2019 253.0 (60.7) $ 3 $ 11,046 $ 998 $ (5,733) $ (311) $ 260 $ 6,263
Issuance of common stock 0.8 — — (44) — — — — (44)
Repurchase of common stock — (2.1) — — — (332) — — (332)
Stock-based compensation — — — 7 — — — — 7
Distributions to non-controlling interests, net — — — — — — — (5) (5)
Net income — — — — 82 — — 9 91
Unrealized losses on derivative instruments, net of tax — — — — — — (39) — (39)
Foreign currency translation, net of tax — — — — — — (151) (4) (155)
Reclassification adjustments, net of tax — — — — — — 16 — 16
Balance, March 31, 2020 253.8 (62.8) 3 11,009 1,080 (6,065) (485) 260 5,802
Issuance of common stock 0.3 — — 1 — — — — 1
Stock-based compensation — — — 30 — — — — 30
Net (loss) income — — — — (23) — — 2 (21)
Unrealized losses on derivative instruments, net of tax
— — — — — — 7 — 7
Foreign currency translation, net of tax — — — — — — 46 (1) 45
Reclassification adjustments, net of tax — — — — — — (12) — (12)
Balance, June 30, 2020 254.1 (62.8) $ 3 $ 11,040 $ 1,057 $ (6,065) $ (444) $ 261 $ 5,852
Issuance of common stock 0.4 — — (3) — — — — (3)
Stock-based compensation — — — 30 — — — — 30
Distributions to non-controlling interests, net — — — — — — — (11) (11)
Net income — — — — 101 — — 7 108
Unrealized losses on derivative instruments, net of tax — — — — — — (1) — (1)
Foreign currency translation, net of tax — — — — — — 126 4 130
Reclassification adjustments, net of tax — — — — — — 2 — 2
Balance, September 30, 2020 $ 254.5 $ (62.8) $ 3 $ 11,067 $ 1,158 $ (6,065) $ (317) $ 261 $ 6,107

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IQVIA HOLDINGS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited)


(in millions)	(in millions)	Common Stock Shares	Treasury Stock Shares	Common Stock		Additional Paid-In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Non- controlling Interests		Total		(in millions)	Common Stock Shares	Treasury Stock Shares	Common Stock		Additional Paid-In Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Non- controlling Interests		Total
Balance, December 31, 2018		251.5	(54)	$	3	$	10,898	$	807	$	(4,770)	$	(224)	$	240	$	6,954
Balance, December 31, 2019																		Balance, December 31, 2019	253.0	(60.7)	$	3	$	11,046	$	998	$	(5,733)	$	(311)	$	260	$	6,263
Issuance of common stock																		Issuance of common stock	0.8	—	—		(44)		—		—		—		—		(44)
Repurchase of common stock																		Repurchase of common stock	—	(2.1)	—		—		—		(332)		—		—		(332)
Stock-based compensation																		Stock-based compensation	—	—	—		7		—		—		—		—		7
Distributions to non-controlling interests, net																		Distributions to non-controlling interests, net	—	—	—		—		—		—		—		(5)		(5)
Net income																		Net income	—	—	—		—		82		—		—		9		91
Unrealized losses on derivative instruments, net of tax																		Unrealized losses on derivative instruments, net of tax	—	—	—		—		—		—		(39)		—		(39)
Foreign currency translation, net of tax																		Foreign currency translation, net of tax	—	—	—		—		—		—		(151)		(4)		(155)
Reclassification adjustments, net of tax																		Reclassification adjustments, net of tax	—	—	—		—		—		—		16		—		16
Balance, March 31, 2020																		Balance, March 31, 2020	253.8	(62.8)	$	3	$	11,009	$	1,080	$	(6,065)	$	(485)	$	260	$	5,802
Issuance of common stock	Issuance of common stock	0.7	—	—		5		—		—		—		—		5		Issuance of common stock	0.3	—	—		1		—		—		—		—		1
Repurchase of common stock	Repurchase of common stock	—	(1)	—		—		—		(145)		—		—		(145)		Repurchase of common stock	—	—	—		—		—		—		—		—		—
Stock-based compensation	Stock-based compensation	—	—	—		21		—		—		—		—		21		Stock-based compensation	—	—	—		30		—		—		—		—		30
Net income	Net income	—	—	—		—		58		—		—		9		67		Net income	—	—	—		—		(23)		—		—		2		(21)
Unrealized losses on derivative instruments, net of tax		—	—	—		—		—		—		(5)		—		(5)
Unrealized gains on derivative instruments, net of tax																		Unrealized gains on derivative instruments, net of tax	—	—	—		—		—		—		7		—		7
Foreign currency translation, net of tax	Foreign currency translation, net of tax	—	—	—		—		—		—		(32)		1		(31)		Foreign currency translation, net of tax	—	—	—		—		—		—		46		(1)		45
Reclassification adjustments, net of tax	Reclassification adjustments, net of tax	—	—	—		—		—		—		(1)		—		(1)		Reclassification adjustments, net of tax	—	—	—		—		—		—		(12)		—		(12)
Balance, March 31, 2019		252.2	(55.0)	$	3	$	10,924	$	865	$	(4,915)	$	(262)	$	250	$	6,865
Balance, June 30, 2020																		Balance, June 30, 2020	254.1	(62.8)	$	3	$	11,040	$	1,057	$	(6,065)	$	(444)	$	261	$	5,852
Issuance of common stock	Issuance of common stock	0.4	—	—		8		—		—		—		—		8		Issuance of common stock	0.4	—	—		(3)		—		—		—		—		(3)
Repurchase of common stock		—	(1.8)	—		—		—		(236)		—		—		(236)
Stock-based compensation	Stock-based compensation	—	—	—		29		—		—		—		—		29		Stock-based compensation	—	—	—		30		—		—		—		—		30
Distributions to non-controlling interests		—	—	—		—		—		—		—		(2)		(2)
Distributions to non-controlling interest, net																		Distributions to non-controlling interest, net	—	—	—		—		—		—		—		(11)		(11)
Net income	Net income	—	—	—		—		60		—		—		11		71		Net income	—	—	—		—		101		—		—		7		108
Unrealized losses on derivative instruments, net of tax	Unrealized losses on derivative instruments, net of tax	—	—	—		—		—		—		(13)		—		(13)		Unrealized losses on derivative instruments, net of tax	—	—	—		—		—		—		(1)		—		(1)
Foreign currency translation, net of tax	Foreign currency translation, net of tax	—	—	—		—		—		—		63		(1)		62		Foreign currency translation, net of tax	—	—	—		—		—		—		126		4		130
Reclassification adjustments, net of tax	Reclassification adjustments, net of tax	—	—	—		—		—		—		(3)		—		(3)		Reclassification adjustments, net of tax	—	—	—		—		—		—		2		—		2
Balance, June 30, 2019		252.6	(56.8)	$	3	$	10,961	$	925	$	(5,151)	$	(215)	$	258	$	6,781
Issuance of common stock		0.2	—	—		(4)		—		—		—		—		(4)
Repurchase of common stock		—	(2)	—		—		—		(313)		—		—		(313)
Balance, Stock-based compensation		—	—	—		30		—		—		—		—		30
Distributions to non-controlling interests		—	—	—		—		—		—		—		(4)		(4)
Net income		—	—	—		—		57		—		—		12		69
Unrealized losses on derivative instruments, net of tax		—	—	—		—		—		—		(5)		—		(5)
Foreign currency translation, net of tax		—	—	—		—		—		—		(159)		(3)		(162)
Reclassification adjustments, net of tax		—	—	—		—		—		—		2		—		2
Balance, September 30, 2019		252.8	(58.8)	3		10,987		982		(5,464)		(377)		263		6,394
Balance, September 30, 2020																		Balance, September 30, 2020	254.5	(62.8)	$	3	$	11,067	$	1,158	$	(6,065)	$	(317)	$	261	$	6,107

The accompanying notes are an integral part of these condensed consolidated financial statements.

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IQVIA HOLDINGS INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(unaudited)

1. Summary of Significant Accounting Policies

The Company

IQVIA Holdings Inc. (together with its subsidiaries, the “Company” or “IQVIA”) is a leading global provider of advanced analytics, technology solutions and clinical research services to the life sciences industry. With approximately ~~68,000~~77,000 employees, IQVIA conducts business in more than 100 countries.

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the Company’s financial condition and results of operations have been included. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2020.~~2021. As such, the information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, ~~2019.~~2020. The balance sheet atas of December 31, ~~2019~~2020 has been derived from the audited consolidated financial statements of the Company, but does not include all the disclosures required by GAAP.

~~Additionally, t~~he outbreak of the novel coronavirus, or COVID-19, and the various governmental, industry and consumer actions related thereto, could have a material and adverse effect on our business, financial condition and results of operations. These effects, which largely depend on future developments that cannot be accurately predicted and are uncertain, could include a negative impact on the availability of our key personnel, temporary closures of our facilities or the facilities of our business partners, customers, suppliers, third party service providers or other vendors, an increased risk of customer defaults or delays in payments or purchasing decisions, and the interruption of domestic and global supply chains, distribution channels, liquidity and capital or financial markets.~~As COVID-19 continues to spread, we have and may continue to experience disruptions that could severely impact our business. As such, the results for the three and nine months ended~~ ~~September 30, 2020~~ ~~may not be indicative of results for the full year.~~

Recently Issued Accounting Standards

Accounting pronouncements adopted

In August 2018, the FASB issued new accounting guidance that clarifies and aligns the accounting for implementation costs for hosting arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted this new accounting guidance on January 1, 2020. The adoption of this new accounting guidance did not have a material effect on the Company’s consolidated financial statements.

In August 2018, the FASB issued new accounting guidance that modifies the disclosure requirements in Topic 820, Fair Value Measurement, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements, such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This new accounting guidance also modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The Company adopted this new accounting guidance on January 1, 2020. The adoption of this new accounting guidance did not have a material effect on the Company’s consolidated financial statements.

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In January 2017, the FASB issued new accounting guidance that simplifies the measurement of goodwill by eliminating the step two impairment test. Step two measures a goodwill impairment loss by comparing the implied fair value of goodwill with the carrying amount of that goodwill. The new guidance requires a comparison of the Company’s fair value of a reporting unit with the carrying amount and the Company is required to recognize an impairment charge for the amount by which the carrying amount exceeds the fair value. The Company adopted this new accounting guidance on January 1, 2020. The adoption of this new accounting guidance did not have a material effect on the Company’s consolidated financial statements.

In June 2016, the FASB issued a new accounting standard intended to provide financial statement users with more decision-useful information about expected credit losses and other commitments to extend credit held by the reporting entity. The standard replaces the incurred loss impairment methodology in current GAAP with one that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company adopted this new accounting guidance on January 1, 2020. The adoption of this guidance did not have a material effect on the Company’s consolidated financial statements. This is based on factors including the Company's assessment of historical losses, client's creditworthiness and the fact that the Company's trade receivables are short term in duration.

~~Accounting pronouncements being evaluated~~

In March 2020, the ~~FASB~~Financial Accounting Standards Board ("FASB") issued new accounting guidance that provides optional expedients and exceptions for applying ~~U.S.~~ GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another rate that is expected to be discontinued. The new accounting guidance isbecame effective for the Company as of March 12, 2020 through December 31, 2022. The Company ~~is currently evaluating the impact~~adopted this new accounting guidance on January 1, 2021. The adoption of this new accounting guidance ~~on its credit arrangements and derivatives that reference LIBOR. The Company does~~did not ~~expect the new accounting guidance to~~ have a material effect on the Company’s consolidated financial statements.

In January 2020, the FASB issued new accounting guidance that states any equity security transitioning from the alternative method of accounting to the equity method, or vice versa, due to an observable transaction, will be remeasured immediately before the transition. In addition, the new accounting guidance clarifies the accounting for certain non-derivative forward contracts or purchased call options to acquire equity securities stating such instruments will be measured using the fair value principles before settlement or exercise. The Company adopted this new accounting guidance ~~will be effective for the Company~~ on January 1, ~~2021 on a prospective basis. Early~~2021. The adoption ~~is permitted. The Company is currently evaluating the impact~~ of this new accounting guidance did not have a material effect on ~~its~~the Company’s consolidated financial statements.

In December 2019, the FASB issued new accounting guidance to clarify and simplify the accounting for income taxes. Changes under the new guidance includes eliminating certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The Company adopted this new accounting guidance ~~will be effective for the Company~~ on January 1, 2021. ~~Early~~The adoption ~~is permitted. The Company is currently evaluating the impact~~ of this new accounting guidance did not have a material effect on ~~its~~the Company’s consolidated financial statements.

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2. Revenues by Geography, Concentration of Credit Risk and Remaining Performance Obligations

The following tables represent revenues by geographic region and reportable segment for the three and nine months ended September 30, ~~2020~~2021 and ~~2019:~~2020:


	Three Months Ended September 30, 2021
(in millions)		Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Total
Revenues:
Americas		$	647	$	942	$	94	$	1,683
Europe and Africa		529		448		42		1,019
Asia-Pacific		161		463		65		689
Total revenues		$	1,337	$	1,853	$	201	$	3,391


	Three Months Ended September 30, 2020
(in millions)		Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Total
Revenues:
Americas		$	599	$	628	$	76	$	1,303
Europe and Africa		457		411		44		912
Asia-Pacific		151		361		59		571
Total revenues		$	1,207	$	1,400	$	179	$	2,786



	Nine Months Ended September 30, 2021
(in millions)		Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Total
Revenues:
Americas		$	1,882	$	2,911	$	258	$	5,051
Europe and Africa		1,684		1,398		133		3,215
Asia-Pacific		472		1,303		197		1,972
Total revenues		$	4,038	$	5,612	$	588	$	10,238



	Nine Months Ended September 30, 2020
(in millions)		Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Total
Revenues:
Americas		$	1,747	$	1,826	$	247	$	3,820
Europe and Africa		1,254		1,214		134		2,602
Asia-Pacific		432		1,036		171		1,639
Total revenues		$	3,433	$	4,076	$	552	$	8,061

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Three Months Ended September 30, 2019
(in millions)
Technology &
Analytics Solutions
Research &
Development Solutions
Contract Sales &
Medical Solutions
Total
Revenues:
Americas $ 580 $ 726 $ 104 $ 1,410
Europe and Africa 369 394 48 811
Asia-Pacific 146 346 56 548
Total revenues $ 1,095 $ 1,466 $ 208 $ 2,769

Nine Months Ended September 30, 2020
(in millions) Technology & Analytics Solutions Research & Development Solutions Contract Sales & Medical Solutions Total
Revenues:
Americas $ 1,747 $ 1,826 $ 247 $ 3,820
Europe and Africa 1,254 1,214 134 2,602
Asia-Pacific 432 1,036 171 1,639
Total revenues $ 3,433 $ 4,076 $ 552 $ 8,061

Nine Months Ended September 30, 2019
(in millions) Technology &
Analytics Solutions Research &
Development Solutions Contract Sales &
Medical Solutions Total
Revenues:
Americas $ 1,722 $ 2,009 $ 298 $ 4,029
Europe and Africa 1,128 1,298 148 2,574
Asia-Pacific 422 1,010 158 1,590
Total revenues $ 3,272 $ 4,317 $ 604 $ 8,193

~~NaN~~No customer accounted for 10% or more of consolidated revenues for the three and nine months ended September 30, ~~2020~~2021 or ~~2019.~~2020.

Transaction Price Allocated to the Remaining Performance Obligations

As of September 30, ~~2020,~~2021, approximately ~~$23.6~~$25.5 billion of revenue is expected to be recognized in the future from remaining performance obligations. The Company expects to recognize revenue on approximately ~~30%~~35% of these remaining performance obligations over the next 12 months, with the balance recognized thereafter. The customer contract transaction price allocated to the remaining performance obligations differs from backlog in that it does not include wholly unperformed contracts under which the customer has a unilateral right to cancel the arrangement.

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3. Trade Accounts Receivable, Unbilled Services and Unearned Income

Trade accounts receivables and unbilled services consist of the following:


(in millions)	September 30, 2021		December 31, 2020
Trade accounts receivable:
Billed	$	1,141	$	1,181
Unbilled services	1,219		1,263
Trade accounts receivable and unbilled services	2,360		2,444
Allowance for doubtful accounts	(30)		(34)
Trade accounts receivable and unbilled services, net	$	2,330	$	2,410

(in millions) September 30, 2020 December 31, 2019
Trade accounts receivable:
Billed $ 1,152 $ 1,312
Unbilled services 1,292 1,286
Trade accounts receivable and unbilled services 2,444 2,598
Allowance for doubtful accounts (30) (16)
Trade accounts receivable and unbilled services, net $ 2,414 $ 2,582

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Unbilled services and unearned income were as follows:

(in millions) September 30, 2020 December 31, 2019 Change
Unbilled services $ 1,292 $ 1,286 $ 6
Unearned income (1,188) (1,014) (174)
Net balance $ 104 $ 272 $ (168)


(in millions, except percentages)	September 30, 2021		December 31, 2020		Change
Unbilled services	$	1,219	$	1,263	$	(44)
Unearned income	(1,826)		(1,252)		(574)
Net balance	$	(607)	$	11	$	(618)

Unbilled services, which is comprised of approximately ~~60%~~63% of unbilled receivables and ~~40%~~37% of contract assets as of September 30, ~~2020, increased~~2021, decreased by $6$44 million as compared to December 31, ~~2019.~~2020. Contract assets are unbilled services for which invoicing is based on the timing of certain milestones related to service contracts for clinical research whereas unbilled receivables are billable upon the passage of time. Unearned income increased by ~~$174~~$574 million over the same period resulting in a decrease of ~~$168~~$618 million in the net balance of unbilled services and unearned income between December 31, ~~2019~~2020 and September 30, ~~2020.~~2021. The change in the net balance is driven by the difference in timing of revenue recognition in accordance with ~~ASC~~Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers, related to the Company’s Research & Development Solutions contracts (which is based on the percentage of costs incurred) versus the timing of invoicing, which is based on certain milestones.

Bad debt expense recognized on the Company’s receivables and unbilled services was not material for the three and nine months ended September 30, ~~2020~~2021 and ~~2019.~~2020.

4. ~~Leases~~

The Company has operating leases for corporate offices, datacenters, motor vehicles and certain equipment, many of which contain renewal and escalation clauses. These operating leases expire at various dates through 2029 with options to cancel certain leases at various intervals. The Company also has finance leases for office and lab spaces that expire in 2044. Based on the timing of payments on the finance leases the cash flow impact is not material for the three and nine months ended September 30, 2020. In determining the lease term at lease commencement, the Company includes the noncancellable term and the periods which the Company deems it is reasonably certain to exercise or not to exercise a renewal or cancellation option.

~~The components of lease expense were as follows:~~

(in millions) Classification Three Months Ended September 30, 2020 Three Months Ended September 30, 2019
Operating lease cost ⁽¹⁾
Selling, general and administrative expenses $ 49 $ 48
Finance lease cost ⁽¹⁾
Depreciation and amortization, and Interest expense 3 0
Total lease cost $ 52 $ 48

(in millions) Classification Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019
Operating lease cost⁽¹⁾
Selling, general and administrative expenses $ 151 $ 143
Finance lease cost⁽¹⁾
Depreciation and amortization, and Interest expense 4 0
Total lease cost $ 155 $ 143

~~(1)Includes variable lease costs, which are immaterial.~~

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~~Other information related to leases was as follows:~~

(in millions) Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019
Supplemental Cash Flow:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases $ 147 $ 147
Right-of-use assets obtained in exchange for lease obligations:
Operating leases $ 92 $ 62
Finance leases $ 119 $ 0
Weighted Average Remaining Lease Term:
Operating leases 4.65 years 4.90 years
Finance leases 24.25 years —
Weighted Average Discount Rate:
Operating leases 4.04 % 4.26 %
Finance leases 3.18 % —

~~Future minimum lease payments under non-cancellable leases as of September 30, 2020 were as follows:~~

(in millions) Operating Leases Finance Leases
Remainder of 2020 $ 44 $ 0
2021 153 0
2022 128 6
2023 100 6
2024 70 6
2025 56 6
Thereafter 44 159
Total future minimum lease payments 595 183
Less imputed interest (54) (63)
Total $ 541 $ 120
Reported as of September 30, 2020:
Other current liabilities $ 154 $ —
Operating lease liabilities 387 —
Other liabilities — 120
Total $ 541 $ 120

5. Goodwill

The following is a summary of goodwill by reportable segment for the nine months ended September 30, ~~2020:~~2021:


(in millions)	(in millions)	Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Consolidated		(in millions)	Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Consolidated
Balance as of December 31, 2019		$	10,374	$	1,646	$	139	$	12,159
Balance as of December 31, 2020										Balance as of December 31, 2020	$	10,864	$	1,646	$	144	$	12,654
Business combinations	Business combinations	84		0		0		84		Business combinations	587		160		25		772
Impact of foreign currency fluctuations and other	Impact of foreign currency fluctuations and other	155		(39)		4		120		Impact of foreign currency fluctuations and other	(293)		(4)		(5)		(302)
Balance as of September 30, 2020		$	10,613	$	1,607	$	143	$	12,363
Balance as of September 30, 2021										Balance as of September 30, 2021	$	11,158	$	1,802	$	164	$	13,124

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6.5. Derivatives

The fair values of the Company’s derivative instruments and the line items on the accompanying condensed consolidated balance sheets to which they were recorded are summarized in the following table:


(in millions)	Balance Sheet Classification	September 30, 2021						December 31, 2020
		Assets		Liabilities		Notional		Assets		Liabilities		Notional
Derivatives designated as hedging instruments:
Foreign exchange forward contracts	Other current assets and liabilities	$	—	$	4	$	109	$	5	$	—	$	70
Interest rate swaps	Other assets and liabilities	—		38		1,800		—		55		1,800
Derivatives not designated as hedging instruments:

Interest rate swaps	Other liabilities	—		—		—		—		1		356
Total derivatives		$	—	$	42			$	5	$	56

(in millions) Balance Sheet Classification September 30, 2020 December 31, 2019
Assets Liabilities Notional Assets Liabilities Notional
Derivatives designated as hedging instruments:
Foreign exchange forward contracts Other current assets and liabilities $ 1 $ 1 $ 93 $ 4 $ 0 $ 148
Interest rate swaps Other assets and liabilities 0 59 1,800 0 27 875
Derivatives not designated as hedging instruments:
Interest rate swaps Other liabilities 0 1 340 0 3 325
Total derivatives $ 1 $ 61 $ 4 $ 30

The effect of the Company’s cash flow hedging instruments on other comprehensive income is summarized in the following table:

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Foreign exchange forward contracts $ 2 $ (1) $ (4) $ (5)
Interest rate derivatives 1 (3) (32) (27)
Total $ 3 $ (4) $ (36) $ (32)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Foreign exchange forward contracts	$	(5)	$	2	$	(9)	$	(4)
Interest rate derivatives	4		1		17		(32)
Total	$	(1)	$	3	$	8	$	(36)

The amount of foreign exchange losses related to the net investment hedge included in the cumulative translation adjustment component of accumulated other comprehensive loss (“AOCI”) for the nine months ended September 30, ~~2020~~2021 was ~~$273~~$332 million.

7.6. Fair Value Measurements

The Company records certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy that prioritizes the inputs used to measure fair value is described below. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

•Level 1 — Quoted prices in active markets for identical assets or liabilities.

•Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

•Level 3 — Unobservable inputs that are supported by little or no market activity. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

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The carrying values of cash, cash equivalents, accounts receivable and accounts payable approximated their fair values atas of September 30, ~~2020~~2021 and December 31, ~~2019~~2020 due to their short-term nature. AtAs of September 30, ~~2020~~2021 and December 31, ~~2019,~~2020, the fair value of total debt approximated ~~$12,443~~$12,333 million and ~~$11,925~~$12,746 million, respectively, as determined under Level 1 and Level 2 measurements for these financial instruments.

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Recurring Fair Value Measurements

The following table summarizes the fair value of the Company’s financial assets and liabilities that are measured and reported at fair value on a recurring basis as of September 30, ~~2020:~~

(in millions) Level 1 Level 2 Level 3 Total
Assets:
Marketable securities 105 $ 0 $ 0 $ 105
Derivatives 0 $ 1 0 1
Total $ 105 $ 1 $ 0 $ 106
Liabilities:
Derivatives $ 0 $ 61 $ 0 $ 61
Contingent consideration 0 0 108 108
Total $ 0 $ 61 $ 108 $ 169
2021:


(in millions)	Level 1		Level 2		Level 3		Total
Assets:
Marketable securities	$	137	$	—	$	—	$	137
Total	$	137	$	—	$	—	$	137��
Liabilities:
Derivatives	$	—	$	42	$	—	$	42
Contingent consideration	—		—		96		96
Total	$	—	$	42	$	96	$	138

Below is a summary of the valuation techniques used in determining fair value:

Marketable securities — The Company values trading and available-for-sale securities using the quoted market value of the securities held.

Derivatives — Derivatives consist of foreign exchange contracts and interest rate swaps. The fair value of foreign exchange contracts is based on observable market inputs of spot and forward rates or using other observable inputs. The fair value of the interest rate swaps is the estimated amount that the Company would receive or pay to terminate such agreements, taking into account market interest rates and the remaining time to maturities or using market inputs with mid-market pricing as a practical expedient for bid-ask spread.

Contingent consideration — The Company values contingent consideration related to business combinations using a weighted probability calculation of potential payment scenarios discounted at rates reflective of the risks associated with the expected future cash flows. ~~Key assumptions~~Assumptions used to estimate the fair value of contingent consideration include various financial metrics (revenue performance targets and operating forecasts) and the probability of achieving the specific targets. Based on the assessments of the probability of achieving specific targets, as of September 30, 2021 the Company has accrued approximately 66% of the maximum contingent consideration payments that could potentially become payable.

The following table summarizes the changes in Level 3 financial assets and liabilities measured on a recurring basis for the nine months ended September 30:

Contingent Consideration
(in millions) 2020 2019
Balance as of January 1 $ 113 $ 123
Business combinations 32 41
Contingent consideration paid (22) (44)
Revaluations included in earnings and foreign currency translation adjustments (15) (7)
Balance as of September 30 $ 108 $ 113

~~The Company used the following key assumptions when estimating the fair value of contingent considerations:~~

~~Unobservable Input~~

~~Weighted average probability of target achievement~~

~~Range of potential payment~~

~~Revenue target~~

~~89%~~

~~0%-100%~~

~~EBITDA target~~

~~96%~~

~~0%-100%~~

~~Operational target~~

~~95%~~

~~0%-100%~~

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	Contingent Consideration
(in millions)	2021		2020
Balance as of January 1	$	119	$	113
Business combinations	39		32
Contingent consideration paid	(37)		(22)
Revaluations included in earnings and foreign currency translation adjustments	(25)		(15)
Balance as of September 30	$	96	$	108

The current portion of contingent consideration is included within accrued expenses and the long-term portion is included within other liabilities on the accompanying condensed consolidated balance sheets. Revaluations of the contingent consideration are recognized in other ~~expense (income),~~income, net on the accompanying condensed consolidated statements of income. A change in significant unobservable inputs above could result in a ~~significantly~~ higher or lower fair value measurement of contingent consideration.

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7. Credit Arrangements

The following is a summary of the Company’s revolving credit facilities atas of September 30, ~~2020:~~

2021:


Facility						Interest Rates
$1,500 million (revolving credit facility)						LIBOR in the relevant currency borrowed plus a margin of ~~1.50% at~~1.25% as of September 30, ~~2020~~2021
$25110 million (receivables financing facility)						LIBOR Market Index Rate ~~(0.15% at~~(0.08% as of September 30, ~~2020)~~2021) plus 0.90%
£10 million (approximately ~~$13~~$14 million) (general banking facility)						Bank’s base rate of 0.10% atas of September 30, ~~2020~~2021 plus 1%

The following table summarizes the Company’s debt at the dates indicated:

(in millions) September 30, 2020 December 31, 2019
Senior Secured Credit Facilities:
Term A Loan due 2023—U.S. Dollar LIBOR at average floating rates of 1.72% $ 739 $ 770
Term A Loan due 2023—U.S. Dollar LIBOR at average floating rates of 2.75% 778 0
Term A Loan due 2023—Euro LIBOR at average floating rates of 1.50% 388 387
Term B Loan due 2024—U.S. Dollar LIBOR at average floating rates of 1.90% 535 535
Term B Loan due 2024—Euro LIBOR at average floating rates of 2.00% 1,354 1,306
Term B Loan due 2025—U.S. Dollar LIBOR at average floating rates of 1.90% 728 733
Term B Loan due 2025—U.S. Dollar LIBOR at average floating rates of 1.97% 929 936
Term B Loan due 2025—Euro LIBOR at average floating rates of 2.00% 668 644
Revolving Credit Facility due 2023:
U.S. Dollar denominated borrowings—U.S. Dollar LIBOR at average floating rates of 1.65% 0 154
Japanese Yen denominated borrowings—Japanese Yen LIBOR at average floating rates of 1.50% 0 212
5.0% Senior Notes due 2027—U.S. Dollar denominated 1,100 1,100
5.0% Senior Notes due 2026—U.S. Dollar denominated 1,050 1,050
2.875% Senior Notes due 2025—Euro denominated 492 471
3.25% Senior Notes due 2025—Euro denominated 1,671 1,598
3.5% Senior Notes due 2024—Euro denominated 0 701
2.25% Senior Notes due 2028—Euro denominated 844 808
2.875% Senior Notes due 2028—Euro denominated 834 0
Receivables financing facility due 2022—U.S. Dollar LIBOR at average floating rates of 1.05% 300 300
Principal amount of debt 12,410 11,705
Less: unamortized discount and debt issuance costs (71) (60)
Less: current portion (144) (100)
Long-term debt $ 12,195 $ 11,545


(in millions)	September 30, 2021		December 31, 2020
Senior Secured Credit Facilities:
Term A Loan due 2023—U.S. Dollar	$	—	$	728
Term A Loan due 2023—U.S. Dollar	—		766
Term A Loan due 2026—U.S. Dollar LIBOR at average floating rates of 1.33%	1,433		—
Term A Loan due 2023—Euro	—		400
Term A Loan due 2026—Euro LIBOR at average floating rates of 1.25%	363		—
Term B Loan due 2024—U.S. Dollar LIBOR at average floating rates of 1.85%	510		535
Term B Loan due 2024—Euro LIBOR at average floating rates of 2.00%	1,269		1,413
Term B Loan due 2025—U.S. Dollar LIBOR at average floating rates of 1.85%	670		726
Term B Loan due 2025—U.S. Dollar LIBOR at average floating rates of 1.90%	860		926
Term B Loan due 2025—Euro LIBOR at average floating rates of 2.00%	605		697
5.0% Senior Notes due 2027—U.S. Dollar denominated	1,100		1,100
5.0% Senior Notes due 2026—U.S. Dollar denominated	1,050		1,050
2.875% Senior Notes due 2025—Euro denominated	487		515
3.25% Senior Notes due 2025—Euro denominated	—		1,748
2.25% Senior Notes due 2028—Euro denominated	834		883
2.875% Senior Notes due 2028—Euro denominated	824		872
1.750% Senior Notes due 2026—Euro denominated	637		—
2.250% Senior Notes due 2029—Euro denominated	1,043		—
Receivables financing facility due 2022—U.S. Dollar	—		240
Receivables financing facility due 2024—U.S. Dollar LIBOR at average floating rates of 0.98%	550		—
Principal amount of debt	12,236		12,600
Less: unamortized discount and debt issuance costs	(64)		(67)
Less: current portion	(91)		(149)
Long-term debt	$	12,081	$	12,384

1614

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Contractual maturities of long-term debt are as follows atas of September 30, ~~2020:~~2021:


(in millions)
Remainder of 2021	$	23
2022	91
2023	91
2024	2,419
2025	2,714
Thereafter	6,898
	$	12,236

(in millions)
Remainder of 2020 36
2021 146
2022 446
2023 1,699
2024 1,867
Thereafter 8,216
12,410

AtAs of September 30, ~~2020,~~2021, there were bank guarantees totaling approximately ~~£0.9~~£0.8 million (approximately ~~$1.1~~$1.0 million) issued against the availability of the general banking facility.

Senior Secured Credit Facilities

~~At September 30, 2020,~~On August 25, 2021, we entered into Amendment No. 9 (the “Amendment”) to the Company’s Fourth Amended and Restated Credit Agreement (the “Prior Credit Agreement,” and together with the Amendment, the "Fifth Amended and Restated Credit Agreement") to (i) extend the maturity of our revolving credit facility to 2026, (ii) refinance our existing term A loans with a new class of term A loans that mature in 2026 and (iii) add IQVIA RDS Inc. as ~~amended (the “Credit Agreement”)~~a borrower under the senior secured credit facilities. In connection with this Amendment, we recognized a $1 million loss on extinguishment of debt, which includes fees and related expenses.

As of September 30, 2021, the Fifth Amended and Restated Credit Agreement provided financing through several senior secured credit facilities (collectively, the “senior secured credit facilities”) of up to approximately ~~$7.6~~$7.2 billion, which consisted of ~~$6.1~~$5.7 billion principal amounts of debt outstanding (as detailed in the table above), and $1.5 billion of available borrowing capacity on the revolving credit facility and standby letters of credit.

On ~~March 11, 2020,~~September 14, 2021, we repaid $250 million of our term B loans under the ~~Company entered into Amendment No. 7 to~~senior secured credit facilities using the Credit Agreement to borrow $900 million in additional U.S. Dollar denominated term A loans due 2023 (the “TLA-2 Loans”) and, on March 30, 2020, entered into Amendment No. 8 to the Credit Agreement to amend certain terms of the TLA-2 Loans. The TLA-2 Loans bear interest based on the U.S. Dollar LIBOR plus a margin ranging from 1.50% to 2.25%, with a U.S. Dollar LIBOR floor of 1.00% per annum. The proceeds from the ~~TLA-2 Loans were used to repay outstanding revolving credit~~increased loans under ~~the Company's senior secured credit facilities.~~ our receivables financing facility.

Receivables Financing Facility

On ~~March 30, 2020,~~August 13, 2021, the Company ~~prepaid $100 million~~amended its receivables financing facility (the “Receivables Amendment”) to extend the term of the ~~TLA-2 loans.~~facility to October 1, 2024 and to increase the size of the facility to $550 million from $300 million. Under the receivables financing facility, certain of our accounts receivable are sold on a non-recourse basis by certain of our consolidated subsidiaries (each, an “Originator”) to another of our consolidated subsidiaries, a bankruptcy-remote special purpose entity (the “SPE”). The SPE obtained a term loan and revolving loan commitment from a third-party lender, secured by liens on the assets of the SPE, to finance the purchase of the accounts receivable, which includes a $440 million term loan and a $110 million revolving loan commitment. Pursuant to the Receivables Amendment, we also added three additional subsidiaries as Originators. As of September 30, 2021, no additional amounts of revolving loans were available under the receivables financing facility.

Senior Notes

On ~~June 24, 2020,~~March 3, 2021, IQVIA Inc. (the “Issuer”), a wholly owned subsidiary of the Company, completed the issuance and sale of ~~€711,000,000~~€1,450,000,000 in gross proceeds of the ~~Issuer’s 2.875% senior notes~~Issuer's (i) €550,000,000 aggregate principal amount of its 1.750% Senior Notes due ~~2028~~2026 (the ~~“2.875%~~“2026 Notes”) and (ii) €900,000,000 aggregate principal amount of its 2.250% Senior Notes due 2029 (the “2029 Notes” and, together with the 2026 Notes, the “Notes”). The ~~2.875%~~ Notes were issued pursuant to an Indenture, dated ~~June 24, 2020,~~March 3, 2021, among the Issuer, U.S. Bank National Association, as trustee of the Notes, and certain subsidiaries of the Issuer as guarantors. The ~~2.875%~~2026 Notes are unsecured obligations of the Issuer, will mature on ~~June~~March 15, ~~2028~~2026 and bear interest at the rate of ~~2.875%~~1.750% per year, with interest payable ~~semiannually~~semi-annually on ~~June~~March 15 and ~~December~~September 15 of each year, beginning on ~~December~~September 15, ~~2020.~~2021. The 2029 Notes are unsecured obligations of the Issuer, will mature on March 15, 2029 and bear interest at the rate of 2.250% per year, with interest payable semi-annually on March 15 and September 15 of each year, beginning on September 15, 2021. The Issuer may redeem (i) the ~~2.875%~~2026 Notes prior to their final stated maturity, subject to a customary make-whole premium, at any time prior to ~~June~~March 15, 2023 (subject to a customary “equity claw” redemption right) and thereafter subject to a redemption premium declining from ~~1.438%~~0.875% to 0.000% and (ii) the 2029 Notes prior to their final stated maturity, subject to a

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customary make-whole premium, at any time prior to March 15, 2024 (subject to a customary “equity claw” redemption right) and thereafter subject to a redemption premium declining from 1.125% to 0.000%. The Issuer may choose to redeem the 2026 Notes and the 2029 Notes, either together or separately, on a non-ratable basis. The proceeds from the ~~2.875%~~ Notes offering were used to redeem all of the Issuer’s outstanding ~~3.500%~~3.250% senior notes due ~~2024~~2025 (the ~~“3.500%~~“3.250% Notes”), including the payment of premiums in respect thereof ~~to repay a portion of the existing borrowings under the Issuer’s revolving credit facility~~ and to pay fees and expenses related to the Notes offering. On February 16, 2021, the Issuer issued a conditional notice of redemption with respect to the 3.250% Notes, for a total redemption price equal to the sum of the principal amount of the 3.250% Notes, accrued and unpaid interest on the 3.250% Notes to the redemption date and the applicable redemption premium. The Issuer’s obligations with respect to the ~~3.500%~~3.250% Notes were discharged on the same day as the Issuer completed the issuance of the ~~3.500% Notes, and the 3.500% Notes were redeemed on July 9, 2020.~~Notes.

Restrictive Covenants

The Company’s debt agreements provide for certain covenants and events of default customary for similar instruments, including a covenant not to exceed a specified ratio of consolidated senior secured net indebtedness to Consolidated EBITDA, as defined in the senior secured credit facility agreement and a covenant to maintain a specified minimum interest coverage ratio. If an event of default occurs under any of the Company’s or the Company’s subsidiaries’ financing arrangements, the creditors under such financing arrangements will be entitled to take various actions, including the acceleration of amounts due under such arrangements, and in the case of the lenders under the revolving credit facility and term loans, other actions permitted to be taken by a secured creditor. The Company’s long-term debt arrangements contain other usual and customary restrictive covenants that, among other things, place limitations on the Company’s ability to declare dividends. AtAs of September 30, ~~2020,~~2021, the Company was in compliance in all material respects with the financial covenants under ~~its debt agreements in all material respects and does not have material uncertainty about ongoing ability to meet the covenants of~~ the Company’s ~~credit~~financing arrangements.

8. Contingencies

The Company and its subsidiaries are involved in legal and tax proceedings, claims and litigation arising in the ordinary course of business. Management periodically assesses the Company’s liabilities and contingencies in connection with these matters based upon the latest information available. For those matters where management currently believes it is probable that the Company will incur a loss and that the probable loss or range of loss can be reasonably estimated, the Company has recorded reserves in the consolidated financial statements based on its best estimates of such loss. In other instances, because of the uncertainties related to either the probable outcome or the amount or range of loss, management is unable to make a reasonable estimate of a liability, if any.

However, even in many instances where the Company has recorded an estimated liability, the Company is unable to predict with certainty the final outcome of the matter or whether resolution of the matter will materially affect the Company’s results of operations, financial position or cash flows. As additional information becomes available, the Company adjusts its assessments and estimates of such liabilities accordingly.

The Company routinely enters into agreements with third parties, including our clients and suppliers, all in the normal course of business. In these agreements, the Company sometimes agrees to indemnify and hold harmless the other party for any damages such other party may suffer as a result of potential intellectual property infringement and other claims. The Company has not accrued a liability with respect to these matters generally, as the exposure is considered remote.

Based on its review of the latest information available, management does not expect the impact of pending legal and tax proceedings, claims and litigation, either individually or in the aggregate, to have a material adverse effect on the Company’s results of operations, cash flows or financial position. However, one or more unfavorable outcomes in any claim or litigation against the Company could have a material adverse effect for the period in which it is resolved. The following is a summary of certain legal matters involving the Company.

On February 13, 2014, a group of approximately 1,200 medical doctors and 900 private individuals filed a civil lawsuit with the Seoul Central District Court against IMS Korea and 2 other defendants, KPA and the Korean Pharmaceutical Information Center (“KPIC”). The civil lawsuit alleges KPA and KPIC collected their personal information in violation of applicable privacy laws without the necessary consent through a software system installed on pharmacy computer systems in Korea, and that personal information was transferred to IMS Korea and sold to pharmaceutical companies. On September 11, 2017, the District Court issued a final decision that the encryption in use by the defendants since June 2014 was adequate to meet the requirements of the Korean Personal Information Privacy Act (“PIPA”) and the sharing of non-identified information for market research purposes was allowed under PIPA. The District Court also found an earlier version of encryption was insufficient to meet PIPA requirements, but no personal data had been leaked or re-identified. The District Court did not award any damages to plaintiffs. Approximately 280 medical doctors and 200 private individuals appealed the District Court decision. On May 3,

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~~Based~~2019, the Appellate Court issued a final decision in which it concluded all of the non-identified information transferred by KPIC to IMS Korea for market research purposes violated PIPA, but did not award any damages to plaintiffs (affirming the District Court’s decision on this latter point). On May 24, 2019, approximately 247 plaintiffs appealed the Appellate Court’s decision to the Supreme Court. The Company believes the appeal is without merit and is vigorously defending its position.

On July 23, 2015, indictments were issued by the Seoul Central District Prosecutors’ Office in South Korea against 24 individuals and companies alleging improper handling of sensitive health information in violation of, among others, South Korea’s Personal Information Protection Act. IMS Korea and 2 of its employees were among the individuals and organizations indicted. Although there is no assertion that IMS Korea used patient identified health information in any of its offerings, prosecutors allege that certain of IMS Korea’s data suppliers should have obtained patient consent when they converted sensitive patient information into non-identified data and that IMS Korea had not taken adequate precautions to reduce the risk of re-identification. On February 14, 2020, the Seoul Central District Court acquitted IMS Korea and its 2 employees of the charges of improper handling of sensitive health information. The matter is now on appeal. The Company intends to vigorously defend its position on appeal.

On January 10, 2017, Quintiles IMS Health Incorporated and IMS Software Services Ltd. (collectively “IQVIA Parties”), filed a lawsuit in the U.S. District Court for the District of New Jersey against Veeva Systems, Inc. (“Veeva”) alleging Veeva unlawfully used IQVIA Parties intellectual property to improve Veeva data offerings, to promote and market Veeva data offerings and to improve Veeva technology offerings. IQVIA Parties seek injunctive relief, appointment of a monitor, the award of compensatory and punitive damages and reimbursement of all litigation expenses, including reasonable attorneys’ fees and costs. On March 13, 2017, Veeva filed counterclaims alleging anticompetitive business practices in violation of the Sherman Act and state laws. Veeva claims damages in excess of $200 million, and is seeking punitive damages and litigation costs, including attorneys’ fees. We believe the counterclaims are without merit, reject all counterclaims raised by Veeva and intend to vigorously defend IQVIA Parties’ position and pursue our ~~current operating plan,~~claims against Veeva. Since the initial filings, the parties have filed additional litigations against each other, primarily concerning the use of IQVIA data with various other Veeva products. The parties are engaged in the discovery process in connection with these lawsuits.

On May 7, 2021, the Court issued a 115-page order and ~~after considering~~opinion (the “Order”) in which it found significant evidence that Veeva had (1) misappropriated IQVIA data and unlawfully used it to improve Veeva data offerings, (2) engaged in a cover-up by deleting significant evidence of its theft of IQVIA’s trade secrets, and (3) improperly withheld certain evidence in furtherance of a crime and/or fraud against IQVIA. The Court imposed five serious sanctions against Veeva, including ordering three separate adverse inference instructions be issued to the ~~likely future impacts~~jury and that IQVIA be permitted to present evidence to the jury of COVID-19, we believe that our available cash and cash equivalents, future cash flows from operations and our ability to access funds under our revolving and other credit facilities will enable us to fund our operating requirements and capital expenditures and meet debt obligations for at leastVeeva’s destruction efforts. Veeva is currently appealing the ~~next 12 months.~~

Order.

9. Stockholders’ Equity

Preferred Stock

The Company is authorized to issue 1.0 million shares of preferred stock, $0.01 per share par value. ~~NaN~~No shares of preferred stock were issued or outstanding as of September 30, ~~2020~~2021 or December 31, ~~2019.~~2020.

Equity Repurchase Program

During the nine months ended September 30, ~~2020,~~2021, the Company repurchased ~~2,106,403~~973,313 shares of its common stock for ~~approximately $321.4~~$221 million under ~~the Repurchase Program. These amounts include 1,000,000 shares of our common stock repurchased from certain of the Company’s stockholders~~its equity repurchase program (the ~~“Selling Stockholders”~~“Repurchase Program”) ~~in a private transaction for an aggregate purchase price of approximately $164.3 million.~~. As of September 30, ~~2020,~~2021, the Company has remaining authorization to repurchase up to approximately ~~$1.0~~$0.7 billion of its common stock under the Repurchase Program. In addition, from time to time, the Company has repurchased and may continue to repurchase common stock through private or other transactions outside of the Repurchase Program.

Non-controlling Interests

On April 1, 2021 the Company acquired the 40% non-controlling interest in Q2 Solutions from Quest Diagnostics Incorporated ("Quest") for approximately $758 million, financed with cash on hand. The $758 million reflects post-closing adjustments to date. The transaction resulted in the Company having 100% ownership in Q2 Solutions. As of September 30, 2021, the Company had no other material non-controlling interests.

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10. Business Combinations

The Company completed several individually immaterial acquisitions during the nine months ended September 30, 2021. The Company’s assessment of fair value and the purchase price allocation related to these acquisitions is preliminary and subject to change upon completion. Further adjustments may be necessary as additional information related to the fair values of assets acquired and liabilities assumed is assessed during the measurement period (up to one year from the acquisition date). The Company recorded goodwill from these acquisitions, primarily attributable to assembled workforce and expected synergies. The condensed consolidated financial statements include the results of the acquisitions subsequent to their respective closing dates. Pro forma information is not presented as pro forma results of operations would not be materially different to the actual results of operations of the Company.

The following table provides certain financial information for these acquisitions, including the preliminary allocation of the purchase price to certain intangible assets acquired and goodwill:


(in millions)	2021		Amortization Period
Assets acquired:
Cash and cash equivalents	$	7
Other assets	40
Goodwill	772
Other identifiable intangibles, net
Customer relationships	208		16 years
Non-compete agreements	2		5 years
Software and related assets	72		8 years
Trade names	7		10 years
Backlog	17		2 years
Liabilities assumed:
Other liabilities	(21)
Deferred income taxes, long-term	(60)
Net assets acquired	$	1,044

The portion of goodwill deductible for income tax purposes was preliminarily assessed as $503 million.

11. Restructuring

The Company has continued to take restructuring actions in ~~2020~~2021 to align its resources and reduce overcapacity to adapt to changing market conditions and integrate acquisitions. These actions include consolidating functional activities, eliminating redundant positions, and aligning resources with customer requirements. These restructuring actions are expected to continue into ~~2021.~~2022.

The following amounts were recorded for the restructuring plans:

(in millions)
Severance and
Related Costs
Facility
Exit Costs
Total
Balance at December 31, 2019 $ 64 $ 3 $ 67
Expense, net of reversals 50 0 50
Payments (51) (1) (52)
Foreign currency translation and other 0 0 0
Balance at September 30, 2020 $ 63 $ 2 $ 65


(in millions)	Severance and Related Costs		Facility Exit Costs		Total
Balance as of December 31, 2020	$	51	$	2	$	53
Expense, net of reversals	15		—		15
Payments	(35)		(1)		(36)
Foreign currency translation and other	(2)		—		(2)
Balance as of September 30, 2021	$	29	$	1	$	30

Restructuring costs are not allocated to the Company’s reportable segments as they are not part of the segment performance measures regularly reviewed by management. The Company expects that the majority of the restructuring accruals atas of September 30, ~~2020~~2021 will be paid in ~~2020~~2021 and ~~2021.~~2022.

~~11.~~

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12. Income Taxes

The effective income tax rate was ~~(2.9)%~~4.4% and ~~(1.4)~~(2.9)% in the third quarter of ~~2020~~2021 and ~~2019,~~2020, respectively, and ~~5.0%~~13.8% and ~~18.8%~~5.0% in the first nine months of ~~2020~~2021 and ~~2019,~~2020, respectively. In the third quarter of 2021 the Company recorded a benefit related to a 2020 ~~the~~ U.S. ~~Treasury Department issued final regulations regarding~~Federal tax return position associated with Foreign Derived Intangible Income (“FDII”) and Global Intangible Low-Taxed Income (“GILTI”)~~. The~~ tax credits of $29 million. In the third quarter of 2020, the U.S. Treasury Department issued final regulations regarding FDII and GILTI and the Company ~~has~~had determined it ~~will~~would elect the GILTI high tax exception as allowed by the final ~~regulations and will amend~~regulations. As a result, the Company amended its 2018 ~~and 2019 US~~U.S. Federal consolidated income tax ~~returns resulting~~return and plans to amend its 2019 U.S. Federal consolidated income tax return. This resulted in a favorable impact of $24 ~~million. The~~million, which the Company recorded ~~this impact~~ in the third quarter of 2020. ~~The~~Additionally, the effective income tax rate in the third quarter and first nine months of 2021 and 2020 ~~and 2019~~ was ~~also~~ favorably impacted as a result of excess tax benefits recognized upon settlement of share-based compensation awards. For the third quarter of ~~2020~~2021 and ~~2019~~2020 this impact was $9$3 million and $3$9 million, respectively, and for the first nine months of ~~2020~~2021 and ~~2019~~2020 this impact was $26 million and $35 million, ~~and $20 million,~~ respectively. ~~Additionally,~~Also, the effective income tax rate in the first nine months of 2020 was unfavorably impacted by a $10 million discrete tax expense related to change in the measurement of ~~the~~ U.S. tax on undistributed foreign earnings.

13. Comprehensive Income

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In the first nine months of 2019 the U.S. Treasury Department issued final regulations on the transition tax and proposed regulations on FDII. While the final regulations related to the transition tax did not have a material impact on the Company, the proposed guidance on FDII had an unfavorable impact. Although the proposed guidance for FDII was not authoritative and subject to change in the regulatory review process, the Company reversed a portion of the tax benefit related to 2018 and recorded a tax expense of $20 million for this impact in the first nine months of 2019.

~~12. Comprehensive Income (Loss)~~

Below is a summary of the components of AOCI:


(in millions)	Foreign Currency Translation		Derivative Instruments		Defined Benefit Plans		Income Taxes		Total
Balance as of December 31, 2020	$	(395)	$	(48)	$	(85)	$	323	$	(205)
Other comprehensive income (loss) before reclassifications	(170)		(1)		—		(66)		(237)
Reclassification adjustments	—		9		—		(2)		7
Acquisition of Quest's non-controlling interest	(10)		—		—		—		(10)
Balance as of September 30, 2021	$	(575)	$	(40)	$	(85)	$	255	$	(445)

(in millions)
Foreign
Currency
Translation
Derivative
Instruments
Defined
Benefit
Plans
Income
Taxes
Total
Balance at December 31, 2019 $ (430) $ (21) $ (16) $ 156 $ (311)
Other comprehensive income (loss) before reclassifications (62) (44) 0 94 (12)
Reclassification adjustments 0 8 0 (2) 6
Balance at September 30, 2020 $ (492) $ (57) $ (16) $ 248 $ (317)

Below is a summary of the adjustments for (gains) losses reclassified from AOCI into the condensed consolidated statements of income and the affected financial statement line item:


(in millions)	Affected Financial Statement Line Item	Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020
Derivative instruments:
Interest rate swaps and caps	Interest expense	$	5	$	—	$	14	$	—
Foreign exchange forward contracts	Revenues	(1)		4		(5)		9
Foreign exchange forward contracts	Other income, net	—		(1)		—		(1)
Total before income taxes		4		3		9		8
Income tax benefit		1		1		2		2
Total net of income taxes		$	3	$	2	$	7	$	6

(in millions)
Affected Financial Statement
Line Item
Three Months Ended September 30, Nine Months Ended September 30,
2020 2019 2020 2019
Derivative instruments:
Foreign exchange forward contracts Revenues $ 4 $ 2 $ 9 $ 3
Foreign exchange forward contracts Other expense (income), net (1) 0 (1) (6)
Total before income taxes 3 2 8 (3)
Income tax (benefit) expense 1 0 2 (1)
Total net of income taxes $ 2 $ 2 $ 6 $ (2)

14. Segments

~~13. Segments~~

The following table presents the Company’s operations by reportable segment. The Company is managed through 3 reportable segments, Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions. Technology & Analytics Solutions provides ~~mission-critical~~critical information, technology solutions and ~~real-world~~real world insights and services to ~~the Company’s~~our life ~~sciences customers.~~science clients. Research & Development Solutions, which primarily serves biopharmaceutical ~~customers,~~clients, is engaged in research and development and provides ~~outsourced~~ clinical research and clinical trial ~~related~~ services. Contract Sales & Medical Solutions provides ~~health care provider (including~~ contract ~~sales) and patient engagement services~~sales to both biopharmaceutical ~~customers~~clients and the broader healthcare market.

Certain costs are not allocated to the Company’s segments and are reported as general corporate and unallocated expenses. These costs primarily consist of stock-based compensation and expenses related to integration activities and acquisitions. The Company also does not allocate depreciation and amortization or impairment charges to its segments. Asset information by segment is not presented, as this measure is not used by the chief operating decision maker to assess the Company’s performance. The Company’s reportable segment information is presented below:

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Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Revenues
Technology & Analytics Solutions $ 1,207 $ 1,095 $ 3,433 $ 3,272
Research & Development Solutions 1,400 1,466 4,076 4,317
Contract Sales & Medical Solutions 179 208 552 604
Total revenues 2,786 2,769 8,061 8,193
Costs of revenue, exclusive of depreciation and amortization
Technology & Analytics Solutions 727 667 2,048 1,956
Research & Development Solutions 925 1,007 2,811 2,924
Contract Sales & Medical Solutions 148 178 469 519
Total costs of revenue 1,800 1,852 5,328 5,399
Selling, general and administrative expenses
Technology & Analytics Solutions 188 167 549 539
Research & Development Solutions 184 172 544 529
Contract Sales & Medical Solutions 14 15 44 45
General corporate and unallocated 74 41 161 137
Total selling, general and administrative expenses 460 395 1,298 1,250
Segment profit
Technology & Analytics Solutions 292 261 836 777
Research & Development Solutions 291 287 721 864
Contract Sales & Medical Solutions 17 15 39 40
Total segment profit 600 563 1,596 1,681
General corporate and unallocated (74) (41) (161) (137)
Depreciation and amortization (319) (299) (943) (888)
Restructuring costs (20) (19) (50) (45)
Total income from operations $ 187 $ 204 $ 442 $ 611


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Revenues
Technology & Analytics Solutions	$	1,337	$	1,207	$	4,038	$	3,433
Research & Development Solutions	1,853		1,400		5,612		4,076
Contract Sales & Medical Solutions	201		179		588		552
Total revenues	3,391		2,786		10,238		8,061
Costs of revenue, exclusive of depreciation and amortization
Technology & Analytics Solutions	795		727		2,415		2,048
Research & Development Solutions	1,291		925		3,967		2,811
Contract Sales & Medical Solutions	167		148		487		469
Total costs of revenue	2,253		1,800		6,869		5,328
Selling, general and administrative expenses
Technology & Analytics Solutions	199		188		579		549
Research & Development Solutions	198		184		576		544
Contract Sales & Medical Solutions	14		14		41		44
General corporate and unallocated	87		74		226		161
Total selling, general and administrative expenses	498		460		1,422		1,298
Segment profit
Technology & Analytics Solutions	343		292		1,044		836
Research & Development Solutions	364		291		1,069		721
Contract Sales & Medical Solutions	20		17		60		39
Total segment profit	727		600		2,173		1,596
General corporate and unallocated	(87)		(74)		(226)		(161)
Depreciation and amortization	(336)		(319)		(1,002)		(943)
Restructuring costs	(2)		(20)		(15)		(50)
Total income from operations	$	302	$	187	$	930	$	442

~~14.~~15. Earnings Per Share

The following table presents the weighted average number of outstanding stock-based awards not included in the computation of diluted earnings per share because they are subject to performance conditions or the effect of including such stock-based awards in the computation would be anti-dilutive:


		Three Months Ended September 30,			Nine Months Ended September 30,				Three Months Ended September 30,		Nine Months Ended September 30,
(in millions)	(in millions)	2020	2019	2020	2019	(in millions)	2021	2020	2021	2020
Shares subject to performance conditions	Shares subject to performance conditions	1.1	1.3	1.2	1.3	Shares subject to performance conditions	0.9	1.1	0.8	1.2
Shares subject to anti-dilutive stock-based awards	Shares subject to anti-dilutive stock-based awards	1.1	0.4	1.3	0.7	Shares subject to anti-dilutive stock-based awards	—	1.1	0.1	1.3

Total shares excluded from diluted earnings per share	Total shares excluded from diluted earnings per share	2.2	1.7	2.5	2.0	Total shares excluded from diluted earnings per share	0.9	2.2	0.9	2.5

The vesting of performance awards is contingent upon the achievement of certain performance targets. The performance awards are not included in diluted earnings per share until the performance targets have been met. Stock-based awards will have a dilutive effect under the treasury method when the respective period’s average market value of the Company’s common stock exceeds the exercise proceeds.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement for Forward-Looking Information

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2019~~2020 (our ~~“2019~~“2020 Form 10-K”).

In addition to historical condensed consolidated financial information, the following discussion contains or incorporates by reference forward-looking statements within the meaning of the federal securities laws that are not historical facts but reflect, among other things, our current expectations and anticipated results of operations, all of which are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, market trends, or industry results to differ materially from those expressed or implied by such forward-looking statements. Therefore, any statements contained herein that are not statements of historical fact may be forward-looking statements and should be evaluated as such. Without limiting the foregoing, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “forecasts,” “projects,” “should,” “targets,” “will” and the negative thereof and similar words and expressions are intended to identify forward-looking statements. We assume no obligation to update any such forward-looking information to reflect actual results or changes in our outlook or the factors affecting such forward-looking information.

We caution you that any such forward-looking statements are further qualified by important factors that could cause our actual operating results to differ materially from those in the forward-looking statements, including without limitation, business disruptions caused by natural disasters, pandemics such as the COVID-19 (coronavirus) outbreak or international conflict or other disruptions outside of our control; our ability to accurately model or forecast the impact of the spread and/or containment of COVID-19, among other sources of business interruption, on our operations and financial results; most of our contracts may be terminated on short notice, and we may lose or experience delays with large client contracts or be unable to enter into new contracts; the market for our services may not grow as we expect; we may be unable to successfully develop and market new services or enter new markets; imposition of restrictions on our use of data by data suppliers or their refusal to license data to us; any failure by us to comply with contractual, regulatory or ethical requirements under our contracts, including current or changes to data protection and privacy laws; breaches or misuse of our or our outsourcing partners’ security or communications systems; failure to meet our productivity or business transformation objectives; failure to successfully invest in growth opportunities; our ability to protect our intellectual property rights and our susceptibility to claims by others that we are infringing on their intellectual property rights; the expiration or inability to acquire third party licenses for technology or intellectual property; any failure by us to accurately and timely price and formulate cost estimates for contracts, or to document change orders; hardware and software failures, delays in the operation of our computer and communications systems or the failure to implement system enhancements; the rate at which our backlog converts to revenue; our ability to acquire, develop and implement technology necessary for our business; consolidation in the industries in which our clients operate; risks related to client or therapeutic concentration; government regulators or our customers may limit the scope of prescription or withdraw products from the market, and government regulators may impose new regulatory requirements or may adopt new regulations affecting the biopharmaceutical industry; the risks associated with operating on a global basis, including currency or exchange rate fluctuations and legal compliance, including anti-corruption laws; risks related to changes in accounting standards; general economic conditions in the markets in which we operate, including financial market conditions and risks related to sales to government entities; the impact of changes in tax laws and regulations; and our ability to successfully integrate, and achieve expected benefits from, our acquired businesses. For a further discussion of the risks relating to our business, see Part I—Item 1A—“Risk Factors” in our ~~2019~~2020 Form 10-K, as updated in ~~our~~this Quarterly Report on Form ~~10-Q for the quarter ended March 31, 2020 (the “1Q 2020 Form 10-Q”).~~10-Q.

Overview

IQVIA ~~Holdings Inc. (“IQVIA,” the “Company,” “we,” “our” and/or “us”)~~ is a leading global provider of advanced analytics, technology solutions, and clinical research services to the life sciences industry. IQVIA ~~applies human~~creates intelligent connections across all aspects of healthcare through its analytics, transformative technology, big data ~~science – leveraging~~resources and extensive domain expertise. IQVIA Connected Intelligence™ delivers powerful insights with speed and agility — enabling customers to accelerate the ~~analytic rigor and clarity of data science to the ever-expanding scope of human science – to enable companies to reimagine and develop new approaches to~~ clinical development and commercialization ~~speed innovation, and accelerate improvements in~~of innovative medical treatments that improve healthcare outcomes. Powered by the IQVIA CORE™, we deliver unique and actionable insights at the intersection of large scale analytics, transformative technology and extensive domain expertise as well as execution capabilities.outcomes for patients. With approximately ~~68,000~~77,000 employees, we conduct operations in more than 100 countries.

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We ~~manage our business~~are a global leader in protecting individual patient privacy. We use a wide variety of privacy-enhancing technologies and safeguards to protect individual privacy while generating and analyzing information on a scale that helps healthcare stakeholders identify disease patterns and correlate with the precise treatment path and therapy needed for better outcomes. Our insights and execution capabilities help biotech, medical device and pharmaceutical companies, medical researchers, government agencies, payers and other healthcare stakeholders tap into a deeper understanding of diseases, human behaviors and scientific advances, in an effort to advance their path toward cures.

We are managed through three reportable segments, Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions. Technology & Analytics Solutions provides critical information, technology solutions and ~~real-world~~real world insights and services to our life science ~~customers.~~ clients. Research & Development Solutions, which primarily serves biopharmaceutical ~~customers,~~clients, is engaged in research and development and provides clinical research and clinical trial services. Contract Sales & Medical Solutions provides contract sales to both biopharmaceutical ~~customers~~clients and the broader healthcare market.

~~Recent Developments~~

As a result of the global spread of COVID-19 beginning in early March, we began to experience general business disruptions that impeded normal business activity including our ability to perform on-site monitoring and deliver offerings that rely on face-to-face interaction or in-person gatherings.

These disruptions have impacted all three of our reportable segments. We continue to see gradual improvement in the accessibility of clinical research sites in the Research & Development Solutions business. We are seeing a return to on-site monitoring visits and similar to last quarter, on-site visits exceeded the number of remote visits. In instances where sites remain physically inaccessible for clinical monitoring, remote monitoring and virtual solutions continue to be effective alternatives. Site start-up activities have increased during the quarter along with patient recruitment trends. Similarly, in our Technology & Analytics Solutions segment, the portion of our Real-World business that requires site monitoring activity also experienced limitations on site accessibility, which led to a reduction in the associated revenue. Within our Technology & Analytics Solutions segment, we have had very little interruption in data supply and demand. Our analytics and consulting businesses have performed well despite business development being hampered by lack of in-person interactions. Our Technology & Analytics solutions offerings that rely on face-to-face interactions or are dependent on in-person gatherings, events or conferences continue to experience disruption, and where we were unable to execute on our commitments due to COVID-19, we were not able to recognize the associated revenue in the period. Activity within the Contract Sales and Medical Solutions business continues to be more challenging due to a decline in sales rep visits, and physician attention diverted to the COVID-19 crisis.

We have accelerated and expanded a variety of cost containment actions to reduce the impact to profitability. We have activated business continuity plans, including remote delivery capabilities in technology and analytics, remote monitoring and virtual trials in Research & Development Solutions and virtual commercial activity with clients wherever possible. We anticipate an acceleration of business momentum when the crisis subsides as delayed trial activities will still need to be performed.

The Company continues to maintain strong liquidity. We do not expect COVID-19 to have a significant impact on our overall liquidity position and outlook. As of September 30, 2020, cash and cash equivalents were $1,464 million and the Company had no amounts drawn under its $1.5 billion revolving credit facility. At September 30, 2020, the Company was in compliance with the financial covenants under its debt agreements in all material respects and does not have material uncertainty about ongoing ability to meet the covenants of our credit arrangements. Based on the company's performance during the pandemic, continued robust demand for its offerings, solid liquidity, and strong free cash flow performance, the Company is lifting the temporary suspension of its share repurchase program.

To help ensure the safety and well-being of our employees, customers, partners and the broader community and continuity of our business operations, we continue to monitor health authority guidance on mitigating the spread of COVID-19 and managing positive cases. We manage our response to the pandemic through a combination of enterprise-wide and regional governance teams, with particular focus on the medical and scientific, information technology, human capital and financial impacts of the pandemic on our business. These teams met, and continue to meet, regularly as necessary based on the status of the pandemic. We closely monitor the impact of COVID-19 on our operations and report to our Board regularly on the progress of our response to the COVID-19 outbreak. We have established global workplace protocols that govern the return of our employees to our offices.

Sources of Revenue

Total revenues are comprised of revenues from the provision of our services. We do not have material product revenues.

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Costs and Expenses

Our costs and expenses are comprised primarily of our costs of revenue, which include reimbursed expenses, and selling, general and administrative expenses. Costs of revenue include compensation and benefits for billable employees and personnel involved in production, data management and delivery, and the costs of acquiring and processing data for our information offerings; costs of staff directly involved with delivering technology-related services offerings and engagements, related accommodations and the costs of data purchased specifically for technology services engagements; costs related to facilities; costs related to training and expenses for information technology (“IT”), reimbursed expenses that are comprised principally of payments to investigators who oversee clinical trials and travel expenses for our clinical monitors and sales representatives; and other expenses directly related to service contracts such as courier fees, laboratory supplies, professional services and travel expenses. Selling, general and administrative expenses include costs related to sales, marketing, and administrative functions (including human resources, legal, finance and general management) for compensation and benefits, travel, professional services, facilities and training and expenses for IT.

Foreign Currency Translation

In the first nine months of ~~2020,~~2021, approximately 35% of our revenues were denominated in currencies other than the United States dollar, which represents approximately 60 currencies. Because a large portion of our revenues and expenses are denominated in foreign currencies and our financial statements are reported in United States dollars, changes in foreign currency exchange rates can significantly affect our results of operations. The ~~revenue~~revenues and expenses of our foreign operations are generally denominated in local currencies and translated into United States dollars for financial reporting purposes. Accordingly, exchange rate fluctuations will affect the translation of foreign results into United States dollars for purposes of reporting our condensed consolidated results. As a result, we believe that reporting results of operations that exclude the effects of foreign currency rate fluctuations on certain financial results can facilitate analysis of period-to-period comparisons. This constant currency information assumes the same foreign currency exchange rates that were in effect for the comparable prior-year period were used in translation of the current period results.

Consolidated Results of Operations

For information regarding our results of operations for Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions, refer to “Segment Results of Operations” later in this section.

Revenues

Three Months Ended September 30, Change
(in millions) 2020 2019 $ %
Revenues $ 2,786 $ 2,769 $ 17 0.6 %

For the third quarter of 2020, our revenues increased $17 million, or 0.6%, as compared to the same period in 2019. This increase was comprised of constant currency revenue decline of approximately $4 million, or 0.1%. The constant currency revenue decline was comprised of a $75 million decrease in Research & Development Solutions and a $30 million decrease in Contract Sales & Medical Solutions, offset by a $101 million increase in Technology & Analytics Solutions.

Nine Months Ended September 30, Change
(in millions) 2020 2019 $ %
Revenues $ 8,061 $ 8,193 $ (132) (1.6) %

For the first nine months of 2020, our revenues decreased $132 million, or 1.6%, as compared to the same period in 2019. This decrease was comprised of constant currency revenue decline of approximately $100 million, or 1.2%. The constant currency revenue decline was comprised of a $232 million decrease in Research & Development Solutions and a $50 million decrease in Contract Sales & Medical Solutions, offset by a $182 million increase in Technology & Analytics Solutions.

~~See Part I—Item 2—“Recent Developments" in this Quarterly Report on Form 10-Q for a discussion of the impact from COVID-19 on our business activity.~~


	Three Months Ended September 30,				Change
(in millions)	2021		2020		$		%
Revenues	$	3,391	$	2,786	$	605	21.7	%

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For the third quarter of 2021, our revenues increased $605 million, or 21.7%, as compared to the same period in 2020. This increase was comprised of constant currency revenue growth of approximately $589 million, or 21.1%, reflecting an $120 million increase in Technology & Analytics Solutions, a $446 million increase in Research & Development Solutions, and a $23 million increase in Contract Sales & Medical Solutions.



	Nine Months Ended September 30,				Change
(in millions)	2021		2020		$		%
Revenues	$	10,238	$	8,061	$	2,177	27.0	%

For the first nine months of 2021, our revenues increased $2,177 million, or 27.0%, as compared to the same period in 2020. This increase was comprised of constant currency revenue growth of approximately $2,015 million, or 25.0%. The constant currency revenue growth was comprised of a $510 million increase in Technology & Analytics Solutions, an $1,477 million increase in Research & Development Solutions, and a $28 million increase in Contract Sales & Medical Solutions.

Costs of Revenue, exclusive of Depreciation and Amortization

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Costs of revenue, exclusive of depreciation and amortization $ 1,800 $ 1,852 $ 5,328 $ 5,399
% of revenues 64.6 % 66.9 % 66.1 % 65.9 %


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2021			2020			2021			2020
Costs of revenue, exclusive of depreciation and amortization	$	2,253		$	1,800		$	6,869		$	5,328
% of revenues	66.4		%	64.6		%	67.1		%	66.1		%

The ~~$52~~$453 million ~~decrease~~increase in costs of ~~revenues,~~revenue, exclusive of depreciation and amortization, for the three months ended September 30, ~~2020~~2021 as compared to the same period in ~~2019~~2020 included a constant currency ~~decrease~~growth of approximately ~~$62~~$436 million, or ~~3.3%. The constant currency decrease consisted of~~24.2%, reflecting a ~~$82~~$56 million ~~decrease~~increase in Technology & Analytics Solutions, a $359 million increase in Research & Development Solutions, and a ~~$32~~$21 million ~~decrease~~increase in Contract Sales & Medical ~~Solutions, offset by a $52~~Solutions.

The $1,541 million increase in ~~Technology & Analytics Solutions.~~

~~The $71 million decrease in~~ costs of ~~revenues,~~revenue, exclusive of depreciation and amortization, for the nine months ended September 30, ~~2020~~2021 as compared to the same period in ~~2019~~2020 included a constant currency ~~decrease~~growth of approximately ~~$19~~$1,382 million, or ~~0.4%. The constant currency decrease consisted of~~25.9%, reflecting a ~~$73 million decrease in Research & Development Solutions, a $49 million decrease in Contract Sales & Medical Solutions, offset by a $103~~$294 million increase in Technology & Analytics Solutions, a $1,076 million increase in Research & Development Solutions, and a $12 million increase in Contract Sales & Medical Solutions.

Selling, General and Administrative Expenses

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Selling, general and administrative expenses $ 460 $ 395 $ 1,298 $ 1,250
% of revenues 16.5 % 14.3 % 16.1 % 15.3 %


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2021			2020			2021			2020
Selling, general and administrative expenses	$	498		$	460		$	1,422		$	1,298
% of revenues	14.7		%	16.5		%	13.9		%	16.1		%

The ~~$65~~$38 million increase in selling, general and administrative expenses for the three months ended September 30, ~~2020~~2021 as compared to the same period in ~~2019~~2020 included a constant currency ~~increase~~growth of approximately ~~$64~~$33 million, or ~~16.2%. The constant currency~~7.2%, reflecting a $9 million increase ~~primarily consisted of~~in Technology & Analytics Solutions, a ~~$32~~$12 million increase in Research & Development Solutions, and a $12 million increase in general corporate and unallocated expenses, ~~a $13 million increase in Research & Development Solutions, a $20 million increase in Technology & Analytics Solutions, offset by a $1 million decrease in~~while Contract Sales & Medical ~~Solutions.~~Solutions remained consistent.

The ~~$48~~$124 million increase in selling, general and administrative expenses for the nine months ended September 30, ~~2020~~2021 as compared to the same period in ~~2019~~2020 included a constant currency ~~increase~~growth of approximately ~~$62~~$94 million, or ~~5.0%. The constant currency~~7.2%, reflecting a $15 million increase ~~primarily consisted of~~in Technology & Analytics Solutions, a ~~$25~~$23 million increase in Research & Development Solutions, and a $60 million increase in general corporate and unallocated expenses, ~~a $17 million increase in Technology & Analytics Solutions, a $21 million increase in Research & Development Solutions,~~ offset by a $1$(4) million decrease in Contract Sales & Medical Solutions.

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Depreciation and Amortization

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Depreciation and amortization 319 299 943 888
% of revenues 11.5 % 10.8 % 11.7 % 10.8 %


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2021			2020			2021			2020
Depreciation and amortization	$	336		$	319		$	1,002		$	943
% of revenues	9.9		%	11.5		%	9.8		%	11.7		%

The ~~$20~~$17 million and ~~$55~~$59 million increases in depreciation and amortization in the three and nine months ended September 30, ~~2020, respectively,~~2021 as compared to the same periods in ~~2019 was~~2020 were primarily due to higher intangible asset balances as a result of acquisitions occurring in ~~2019,~~2020 and 2021, increased amortization due to higher capitalized software balances, and accelerated ~~depreciation on an internal-use software asset~~amortization related to intangibles impacted by the Company's acquisition of Quest's non-controlling interest in ~~the first quarter of 2020.~~Q2 Solutions.

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Restructuring Costs

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Restructuring costs $ 20 $ 19 $ 50 $ 45


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Restructuring costs	$	2	$	20	$	15	$	50

The restructuring costs incurred during 2021 and 2020 were due to ongoing efforts to streamline our global operations. The remaining actions under these plans are expected to occur throughout ~~2020~~2021 and into ~~2021~~2022 and are expected to consist of consolidating functional activities, eliminating redundant positions, and aligning resources with customer requirements.

Interest Income and Interest Expense

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Interest income $ (1) $ (3) $ (4) $ (7)
Interest expense $ 100 $ 114 $ 314 $ 338


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Interest income	$	(2)	$	(1)	$	(4)	$	(4)
Interest expense	$	92	$	100	$	285	$	314

Interest income includes interest received primarily from bank balances and investments.

Interest expense during the three and nine months ended September 30, ~~2020~~2021 was lower than the same periods in ~~2019~~2020 due to lower interest rates attributed to lower LIBOR rates, the refinancing of our existing term A loans and the redemption of the ~~$800~~€1,425 million of ~~4.875%~~3.250% senior notes due ~~2023, partially offset by an increase in the average debt outstanding.~~2025. See “Liquidity and Capital Resources” for more information on this transaction.

Loss on Extinguishment of Debt


		Three Months Ended September 30,						Nine Months Ended September 30,							Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)	2021		2020		2021		2020
Loss on extinguishment of debt	Loss on extinguishment of debt	$	—	$	24	$	12	$	24	Loss on extinguishment of debt	$	1	$	—	$	25	$	12

During the ~~second quarter of 2020,~~three months ended September 30, 2021, we recognized a loss on extinguishment of debt for fees and expenses incurred related to the refinancing of our ~~3.500%~~Prior Credit Agreement.

During the ninemonths ended September 30, 2021, we recognized a loss on extinguishment of debt for fees and expenses incurred related to the refinancing of our 3.250% senior notes due ~~2024.~~2025 and Prior Credit Agreement..

Other Income, Net

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Other income, net $ (14) $ — $ (59) $ —


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Other income, net	$	(62)	$	(14)	$	(128)	$	(59)

Other income, net for the three ~~months ended September 30, 2020 increased as compared to the same period in the prior year, primarily due to a gain on investments in mutual funds.~~

~~Other income, net for the~~and nine months ended September 30, ~~2020~~2021 increased as compared to the same periods in the prior year, primarily due to ~~a decrease in fair value of acquisition-related contingent consideration, mark-to-market gains on equity securities, a decrease in~~ foreign currency ~~losses, and a gain on investments in mutual funds.~~gain.

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Income Tax Expense

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Income tax (benefit) expense $ (3) $ (1) $ 9 $ 48

(Benefit)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Income tax expense (benefit)	$	12	$	(3)	$	104	$	9

Our effective income tax rate was ~~(2.9)%~~4.4% and ~~(1.4)~~(2.9)% in the third quarter of ~~2020~~2021 and ~~2019,~~2020, respectively, and ~~5.0%~~13.8% and ~~18.8%~~5.0% in the first nine months of ~~2020~~2021 and ~~2019, respectively.~~2020. In the third quarter of 2021, we recorded a benefit related to a 2020 ~~the~~ U.S. ~~Treasury Department issued final regulations regarding~~Federal tax return position associated with Foreign Derived Intangible Income (“FDII”) and Global Intangible Low-Taxed Income (“GILTI”)~~. We have~~ tax credits of $29 million. In the third quarter of 2020, the U.S. Treasury Department issued final regulations regarding FDII and GILTI and we had determined we ~~will~~would elect the GILTI high tax exception as allowed by the final ~~regulations and will amend its~~regulations. As a result, we amended our 2018 ~~and 2019 US~~U.S. Federal consolidated income tax ~~returns resulting~~return and plan to amend our 2019 U.S. Federal consolidated income tax return. This resulted in a favorable impact of $24 ~~million. We~~million, which we recorded ~~this impact~~ in the third quarter of 2020. ~~Our~~Additionally, our effective income tax rate in the third quarter and in the first nine months of 2021 and 2020 ~~and 2019~~ was ~~also~~ favorably impacted as a result of excess tax benefits recognized upon settlement of share-based compensation awards. For the third quarter of ~~2020~~2021 and ~~2019~~2020, this impact was $9$3 million and $3$9 million, respectively, and for the first nine months of ~~2020~~2021 and ~~2019~~2020, this impact was $26 million and $35 million, ~~and $20 million,~~ respectively. ~~Additionally,~~Also, our effective income tax rate in the first nine months of 2020 was unfavorably impacted by a $10 million discrete tax expense related to change in the measurement of ~~the~~ U.S. tax on undistributed foreign earnings.

In the first nine months of 2019, the U.S. Treasury Department issued final regulations on the transition tax and proposed regulations on FDII. While the final regulations related to the transition tax did not have a material impact on us, the proposed guidance on FDII had an unfavorable impact. Although the proposed guidance for FDII was not authoritative and subject to change in the regulatory review process, we reversed a portion of the tax benefit related to 2018 and recorded a tax expense of $20 million for this impact in the first nine months of 2019.

Equity in Earnings of Unconsolidated Affiliates

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Equity in earnings (loss) of unconsolidated affiliates $ 3 $ (1) $ 8 $ (1)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Equity in earnings of unconsolidated affiliates	$	—	$	3	$	5	$	8

Equity in earnings of unconsolidated affiliates for the three ~~and nine~~ months ended September 30, ~~2020 increased~~2021 decreased as compared to the same period in the prior year primarily ~~related~~due to ~~higher earnings~~losses from our ~~investment~~investments in the NovaQuest Pharma Opportunities ~~Fund III.~~Funds.

Equity in earnings of unconsolidated affiliates for the nine months ended September 30, 2021 decreased as compared to the same period in the prior year primarily due to losses from investments in some of our unconsolidated affiliates.

Net Income Attributable to Non-controlling Interests

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2020 2019 2020 2019
Net income attributable to non-controlling interests $ (7) $ (12) $ (18) $ (32)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2021		2020		2021		2020
Net income attributable to non-controlling interests	$	—	$	(7)	$	(5)	$	(18)

Net income attributable to non-controlling interests ~~primarily~~ included ~~Quest Diagnostics Incorporated’s~~Quest’s interest in Q² Solutions. On April 1, 2021 the Company acquired the 40% non-controlling interest in Q

2 Solutions from Quest which resulted in a decrease in the net income attributable to non-controlling interests for the three and nine months ended September 30, 2021 as compared to prior periods. See Note 9 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details regarding this transaction.

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Segment Results of Operations

The Company’s revenues and profit by segment are as follows:


Three Months Ended September 30, 2020 and 2019
Three Months Ended September 30, 2021 and 2020										Three Months Ended September 30, 2021 and 2020
		Segment Revenues						Segment Profit							Segment Revenues				Segment Profit
(in millions)	(in millions)	2020		2019		2020		2019		(in millions)	2021		2020		2021		2020
Technology & Analytics Solutions	Technology & Analytics Solutions	$	1,207	$	1,095	$	292	$	261	Technology & Analytics Solutions	$	1,337	$	1,207	$	343	$	292
Research & Development Solutions	Research & Development Solutions	1,400		1,466		291		287		Research & Development Solutions	1,853		1,400		364		291
Contract Sales & Medical Solutions	Contract Sales & Medical Solutions	179		208		17		15		Contract Sales & Medical Solutions	201		179		20		17
Total	Total	2,786		2,769		600		563		Total	3,391		2,786		727		600
General corporate and unallocated	General corporate and unallocated					(74)		(41)		General corporate and unallocated					(87)		(74)
Depreciation and amortization	Depreciation and amortization					(319)		(299)		Depreciation and amortization					(336)		(319)
Restructuring costs	Restructuring costs					(20)		(19)		Restructuring costs					(2)		(20)
Consolidated	Consolidated	$	2,786	$	2,769	$	187	$	204	Consolidated	$	3,391	$	2,786	$	302	$	187

Nine Months Ended September 30, 2020 and 2019
Segment Revenues Segment Profit
(in millions) 2020 2019 2020 2019
Technology & Analytics Solutions $ 3,433 $ 3,272 $ 836 $ 777
Research & Development Solutions 4,076 4,317 721 864
Contract Sales & Medical Solutions 552 604 39 40
Total 8,061 8,193 1,596 1,681
General corporate and unallocated (161) (137)
Depreciation and amortization (943) (888)
Restructuring costs (50) (45)
Consolidated $ 8,061 $ 8,193 $ 442 $ 611



Nine Months Ended September 30, 2021 and 2020
	Segment Revenues				Segment Profit
(in millions)	2021		2020		2021		2020
Technology & Analytics Solutions	$	4,038	$	3,433	$	1,044	$	836
Research & Development Solutions	5,612		4,076		1,069		721
Contract Sales & Medical Solutions	588		552		60		39
Total	10,238		8,061		2,173		1,596
General corporate and unallocated					(226)		(161)
Depreciation and amortization					(1,002)		(943)
Restructuring costs					(15)		(50)
Consolidated	$	10,238	$	8,061	$	930	$	442

Certain costs are not allocated to our segments and are reported as general corporate and unallocated expenses. These costs primarily consist of stock-based compensation and expenses related to integration activities and acquisitions. We also do not allocate depreciation and amortization or impairment charges to our segments.

Technology & Analytics Solutions


	Three Months Ended September 30,				Change
(in millions)	2021		2020		$		%
Revenues	$	1,337	$	1,207	$	130	10.8	%
Costs of revenue, exclusive of depreciation and amortization	795		727		68		9.4
Selling, general and administrative expenses	199		188		11		5.9
Segment profit	$	343	$	292	$	51	17.5	%

Three Months Ended September 30, Change
(in millions) 2020 2019 $ %
Revenues $ 1,207 $ 1,095 $ 112 10.2
Costs of revenue, exclusive of depreciation and amortization 727 667 60 9.0
Selling, general and administrative 188 167 21 12.6
Segment profit $ 292 $ 261 $ 31 11.9


		Nine Months Ended September 30,						Change						Nine Months Ended September 30,				Change
(in millions)	(in millions)	2020		2019		$		%	(in millions)	2021		2020		$		%
Revenues	Revenues	$	3,433	$	3,272	$	161	4.9	Revenues	$	4,038	$	3,433	$	605	17.6	%
Costs of revenue, exclusive of depreciation and amortization	Costs of revenue, exclusive of depreciation and amortization	2,048		1,956		92		4.7	Costs of revenue, exclusive of depreciation and amortization	2,415		2,048		367		17.9
Selling, general and administrative	Selling, general and administrative	549		539		10		1.9	Selling, general and administrative	579		549		30		5.5
Segment profit	Segment profit	$	836	$	777	$	59	7.6	Segment profit	$	1,044	$	836	$	208	24.9	%

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Revenues

Technology & Analytics Solutions’ revenues were ~~$1,207~~$1,337 million for the third quarter of ~~2020,~~2021, an increase of ~~$112~~$130 million, or ~~10.2%~~10.8%, over the same period in ~~2019.~~2020. This increase was comprised of constant currency revenue growth of approximately ~~$101~~$120 million, or ~~9.2%.~~9.9%, reflecting revenue growth across all regions.

Technology & Analytics Solutions’ revenues were ~~$3,433~~$4,038 million for the first nine months of ~~2020,~~2021, an increase of ~~$161~~$605 million, or ~~4.9%~~17.6%, over the same period in ~~2019.~~2020. This increase was comprised of constant currency revenue growth of approximately ~~$182~~$510 million, or ~~5.6%.~~14.9%, reflecting revenue growth across all regions.

The ~~constant currency~~revenue growth for the three and nine months ended September 30, ~~2020 resulted primarily from revenue growth in the Americas and Europe and Africa region. The revenue growth in these regions~~2021 was driven by higher technology, real-world and analytical ~~services. See Part I—Item 2—“Recent Developments" in this Quarterly Report on Form 10-Q for a discussion of the impact from~~services and COVID-19 ~~on Technology & Analytics Solutions business activity.~~related work.

Costs of Revenue, exclusive of Depreciation and Amortization

Technology & Analytics Solutions’ costs of revenue, exclusive of depreciation and amortization, increased ~~$60~~$68 million, or ~~9.0%~~9.4%, in the third quarter of ~~2020~~2021 over the same period in ~~2019.~~2020. This increase included a constant currency increase of approximately ~~$52~~$56 million, or ~~7.8%~~7.7%.

Technology & Analytics Solutions’ costs of revenue, exclusive of depreciation and amortization, increased ~~$92~~$367 million, or ~~4.7%~~17.9%, in the first nine months of ~~2020~~2021 over the same period in ~~2019.~~2020. This increase included a constant currency increase of approximately ~~$103~~$294 million, or ~~5.3%~~14.4%.

The constant currency increase for the three and nine months ended September 30, ~~2020~~2021 was primarily ~~due~~related to an increase in compensation and related expenses to support revenue growth.

Selling, General and Administrative Expenses

Technology & Analytics Solutions’ selling, general and administrative expenses increased ~~$21~~$11 million, or ~~12.6%~~5.9%, in the third quarter of ~~2020~~2021 as compared to the same period in ~~2019,~~2020, which included a constant currency increase of approximately ~~$20~~$9 million, or ~~12.0%~~4.8%.

Technology & Analytics Solutions’ selling, general and administrative expenses increased ~~$10~~$30 million, or ~~1.9%~~5.5%, in the first nine months of ~~2020~~2021 as compared to the same period in ~~2019,~~2020, which included a constant currency increase of approximately ~~$17~~$15 million, or ~~3.2%~~2.7%.

The constant currency increase for the three and nine months ended September 30, ~~2020~~2021 was primarily related to an increase in compensation and related expenses.

~~Research & Development Solutions~~

Three Months Ended September 30, Change
(in millions) 2020 2019 $ %
Revenues $ 1,400 $ 1,466 $ (66) (4.5) %
Costs of revenue, exclusive of depreciation and amortization 925 1,007 (82) (8.1) %
Selling, general and administrative expenses 184 172 12 7.0 %
Segment profit $ 291 $ 287 $ 4 1.4 %

Nine Months Ended September 30, Change
(in millions) 2020 2019 $ %
Revenues $ 4,076 $ 4,317 $ (241) (5.6) %
Costs of revenue, exclusive of depreciation and amortization 2,811 2,924 (113) (3.9) %
Selling, general and administrative expenses 544 529 15 2.8 %
Segment profit $ 721 $ 864 $ (143) (16.6) %

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Research & Development Solutions


	Three Months Ended September 30,				Change
(in millions)	2021		2020		$		%
Revenues	$	1,853	$	1,400	$	453	32.4	%
Costs of revenue, exclusive of depreciation and amortization	1,291		925		366		39.6
Selling, general and administrative expenses	198		184		14		7.6
Segment profit	$	364	$	291	$	73	25.1	%



	Nine Months Ended September 30,				Change
(in millions)	2021		2020		$		%
Revenues	$	5,612	$	4,076	$	1,536	37.7	%
Costs of revenue, exclusive of depreciation and amortization	3,967		2,811		1,156		41.1
Selling, general and administrative expenses	576		544		32		5.9
Segment profit	$	1,069	$	721	$	348	48.3	%

Backlog

Research & Development Solutions’ contracted backlog increased from ~~$19.0~~$22.6 billion atas of December 31, ~~2019~~2020 to ~~$21.7~~$24.4 billion atas of September 30, ~~2020~~2021 and we expect approximately ~~$5.8~~$6.9 billion of this backlog to convert to revenue in the next twelve months.

Revenues

Research & Development Solutions’ revenues were ~~$1,400~~$1,853 million in the third quarter of ~~2020, a decrease~~2021, an increase of ~~$66~~$453 million, or ~~4.5%~~32.4%, over the same period in ~~2019.~~2020. This ~~decrease~~increase was comprised of constant currency revenue ~~decline~~increase of approximately ~~$75~~$446 million, or ~~5.1%.~~31.9%, reflecting revenue growth across all regions.

Research & Development Solutions’ revenues were ~~$4,076~~$5,612 million in the first nine months of ~~2020, a decrease~~2021, an increase of ~~$241~~$1,536 million, or ~~5.6%~~37.7%, over the same period in ~~2019.~~2020. This ~~decrease~~increase was comprised of constant currency revenue ~~decline~~increase of approximately ~~$232~~$1,477 million, or ~~5.4%.~~36.2%, reflecting revenue growth across all regions.

The ~~constant currency decline~~revenue growth for the three and nine months ended September 30, ~~2020~~2021 was primarily ~~included~~the result of volume-related ~~decreases~~increases in clinical services and lab ~~testing. See Part I—Item 2—“Recent Developments" in this Quarterly Report on Form 10-Q for a discussion of the impact~~testing, including incremental revenue from large COVID-19 ~~on Research & Development Solutions business activity.~~vaccine clinical trials.

Costs of Revenue, exclusive of Depreciation and Amortization

Research & Development Solutions’ costs of revenue, ~~decreased $82~~exclusive of depreciation and amortization, increased $366 million, or ~~8.1%~~39.6%, in the third quarter of ~~2020~~2021 over the same period in ~~2019.~~2020. This ~~decrease~~increase included a constant currency ~~decrease~~increase of approximately ~~$82~~$359 million, or ~~8.1%~~38.8%.

Research & Development Solutions’ costs of revenue, ~~decreased $113~~exclusive of depreciation and amortization, increased $1,156 million, or ~~3.9%~~41.1%, in the first nine months of ~~2020~~2021 over the same period in ~~2019.~~2020. This ~~decrease~~increase included a constant currency ~~decrease~~increase of approximately ~~$73~~$1,076 million, or ~~2.5%~~38.3%.

The constant currency ~~decrease~~increase for the three and nine months ended September 30, ~~2020~~2021 was primarily related to ~~a decrease~~an increase in compensation and related expenses as a result of ~~reduced volume~~volume-related increases in clinical services and lab ~~testing impacted by COVID-19.~~testing.

Selling, General and Administrative Expenses

Research & Development Solutions’ selling, general and administrative expenses increased ~~$12~~$14 million, or ~~7.0%~~7.6%, in the third quarter of ~~2020~~2021 as compared to the same period in ~~2019, which~~2020, and included a constant currency increase of approximately ~~$13~~$12 million, or ~~7.6%~~6.5%.

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Research & Development Solutions’ selling, general and administrative expenses increased ~~$15~~$32 million, or ~~2.8%~~5.9%, in the first nine months of ~~2020~~2021 as compared to the same period in ~~2019, which~~2020, and included a constant currency increase of approximately ~~$21~~$23 million, or ~~4.0%~~4.2%.

The constant currency increase for the three and nine months ended September 30, ~~2020~~2021 was primarily related to an increase in compensation and related expenses.

Contract Sales & Medical Solutions


	Three Months Ended September 30,				Change
(in millions)	2021		2020		$		%
Revenues	$	201	$	179	$	22	12.3	%
Costs of revenue, exclusive of depreciation and amortization	167		148		19		12.8
Selling, general and administrative expenses	14		14		—		—
Segment profit	$	20	$	17	$	3	17.6	%

Three Months Ended September 30, Change
(in millions) 2020 2019 $ %
Revenues $ 179 $ 208 $ (29) (13.9) %
Costs of revenue, exclusive of depreciation and amortization 148 178 (30) (16.9) %
Selling, general and administrative expenses 14 15 (1) (6.7)
Segment profit $ 17 $ 15 $ 2 13.3 %

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		Nine Months Ended September 30,						Change							Nine Months Ended September 30,				Change
(in millions)	(in millions)	2020		2019		$		%		(in millions)	2021		2020		$		%
Revenues	Revenues	$	552	$	604	$	(52)	(8.6)	%	Revenues	$	588	$	552	$	36	6.5	%
Costs of revenue, exclusive of depreciation and amortization	Costs of revenue, exclusive of depreciation and amortization	469		519		(50)		(9.6)	%	Costs of revenue, exclusive of depreciation and amortization	487		469		18		3.8
Selling, general and administrative expenses	Selling, general and administrative expenses	44		45		(1)		(2.2)	%	Selling, general and administrative expenses	41		44		(3)		(6.8)
Segment profit	Segment profit	$	39	$	40	$	(1)	(2.5)	%	Segment profit	$	60	$	39	$	21	53.8	%

Revenues

Contract Sales & Medical Solutions’ revenues were ~~$179~~$201 million in the third quarter of ~~2020, a decrease~~2021, an increase of ~~$29~~$22 million, or ~~13.9%~~12.3%, over the same period in ~~2019.~~2020. This ~~decrease~~increase included a constant currency revenue ~~decline~~increase of approximately ~~$30~~$23 million, or ~~14.4%~~12.8%.

Contract Sales & Medical Solutions’ revenues were ~~$552~~$588 million in the first nine months of ~~2020, a decrease~~2021, an increase of ~~$52~~$36 million, or ~~8.6%~~6.5%, over the same period in ~~2019.~~2020. This ~~decrease~~increase included a constant currency revenue ~~decline~~increase of approximately ~~$50~~$28 million, or ~~8.3%~~5.1%.

The ~~constant currency decline~~revenue growth for the three and nine months ended September 30, ~~2020~~2021 was largely due to a volume ~~decrease~~increase in the Americas ~~region, partially offset by a volume increase in the~~and Asia-Pacific regions. ~~See Part I—Item 2—“Recent Developments" in this Quarterly Report on Form 10-Q for a discussion of the impact from COVID-19 on Contract Sales & Medical Solutions business activity.~~

Costs of Revenue, exclusive of Depreciation and Amortization

Contract Sales & Medical Solutions’ costs of revenue, ~~decreased $30~~exclusive of depreciation and amortization, increased $19 million, or ~~16.9%~~12.8%, in the third quarter of ~~2020~~2021 as compared to the same period in ~~2019.~~2020. This ~~decrease~~increase included a constant currency ~~decrease~~increase of approximately ~~$32~~$21 million, or ~~18.0%~~14.2%.

Contract Sales & Medical Solutions’ costs of revenue, ~~decreased $50~~exclusive of depreciation and amortization, increased $18 million, or ~~9.6%~~3.8%, in the first nine months of ~~2020~~2021 as compared to the same period in ~~2019.~~2020. This ~~decrease~~increase included a constant currency ~~decline~~increase of approximately ~~$49~~$12 million, or ~~9.4%~~2.6%.

The constant currency ~~decrease~~increase for the three and nine months ended September 30, ~~2020~~2021 was ~~due~~primarily related to ~~a decrease~~an increase in compensation and related ~~expenses as a result of reduced volume in the Americas region.~~expenses.

Selling, General and Administrative Expenses

Contract Sales & Medical Solutions’ selling, general and administrative expenses remained ~~flat for~~consistent in the ~~three and nine months ended September 30, 2020~~third quarter of 2021 as compared to the same period in ~~2019.~~2020.

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Contract Sales & Medical Solutions’ selling, general and administrative expenses decreased $(3) million, or (6.8)%, in the first nine months of 2021 as compared to the same period in 2020. This decrease included a constant currency decrease of approximately $(4) million, or (9.1)%.

The constant currency decrease for the nine months ended September 30, 2021 was primarily related to a decrease in compensation and related expenses.

Liquidity and Capital Resources

Overview

We assess our liquidity in terms of our ability to generate cash to fund our operating, investing and financing activities. Our principal source of liquidity is operating cash flows. In addition to operating cash flows, other significant factors that affect our overall management of liquidity include: capital expenditures, acquisitions, investments, debt service requirements, dividends, equity repurchases, adequacy of our revolving and other credit facilities and access to the capital markets. ~~We do not expect to have a significant impact on our overall liquidity position and outlook as a result of COVID-19.~~

We manage our worldwide cash requirements by monitoring the funds available among our subsidiaries and determining the extent to which those funds can be accessed on a cost-effective basis. The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences; however, those balances are generally available without legal

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restrictions to fund ordinary business operations. We have and expect to transfer cash from those subsidiaries to the United States and to other international subsidiaries when it is cost effective to do so.

We had a cash balance of ~~$1,464~~$1,470 million atas of September 30, ~~2020~~2021 ($~~780~~600 million of which was in the United States), ~~an increase~~a decrease from ~~$837~~$1,814 million atas of December 31, ~~2019. We also had $1.5 billion of additional available borrowings under our revolving credit facility at September 30,~~ 2020.

Based on our current operating plan, ~~and after considering the likely future impacts of COVID-19,~~ we believe that our available cash and cash equivalents, future cash flows from operations and our ability to access funds under our revolving and other credit facilities will enable us to fund our operating requirements and capital expenditures and meet debt obligations for at least the next 12 months. We regularly evaluate our debt arrangements, as well as market conditions, and from time to time we may explore opportunities to modify our existing debt arrangements or pursue additional financing arrangements that could result in the issuance of new debt securities by us or our affiliates. We may use our existing cash, cash generated from operations or dispositions of assets or businesses and/or proceeds from any new financing arrangements or issuances of debt or equity securities to repay or reduce some of our outstanding obligations, to repurchase shares from our stockholders or for other purposes. As part of our ongoing business strategy, we also continually evaluate new acquisition, expansion and investment possibilities or other strategic growth opportunities, as well as potential dispositions of assets or businesses, as appropriate, including dispositions that may cause us to recognize a loss on certain assets. Should we elect to pursue any such transaction, we may seek to obtain debt or equity financing to facilitate those activities. Our ability to enter into any such potential transactions and our use of cash or proceeds is limited to varying degrees by the terms and restrictions contained in our existing debt arrangements. We cannot provide assurances that we will be able to complete any such financing arrangements or other transactions on favorable terms or at all.

Equity Repurchase Program

When the COVID-19 outbreak became a pandemic in March, the Company temporarily suspended share repurchase activity. Based on the Company's performance during the pandemic, continued robust demand for its offerings, solid liquidity, and strong free cash flow performance, the Company is lifting the temporary suspension of its share repurchase program. During the nine months ended September 30, ~~2020,~~2021, we repurchased ~~2,106,403~~973,313 shares of our common stock for ~~approximately $321.4~~$221 million under the Repurchase Program. ~~These amounts include 1,000,000 shares of our common stock repurchased from certain Selling Stockholders in a private transaction for an aggregate purchase price of approximately $164.3 million.~~ See Note 9 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details regarding the Repurchase Program.

As of September 30, ~~2020,~~2021, we have remaining authorization to repurchase up to approximately ~~$1.0~~$0.7 billion of our common stock under the Repurchase Program. In addition, from time to time, we have repurchased and may continue to repurchase common stock through private or other transactions outside of the Repurchase Program.

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Debt

Senior Secured Credit Facilities

On August 25, 2021, we entered into Amendment No. 9 (the “Amendment”) to the Company’s Fourth Amended and Restated Credit Agreement (the “Prior Credit Agreement,” and together with the Amendment, the "Fifth Amended and Restated Credit Agreement") to (i) extend the maturity of our revolving credit facility to 2026, (ii) refinance our existing term A loans with a new class of term A loans that mature in 2026 and (iii) add IQVIA RDS Inc. as a borrower under the senior secured credit facilities. In connection with this Amendment, we recognized a $1 million loss on extinguishment of debt, which includes fees and related expenses.

As of September 30, 2021, the Fifth Amended and Restated Credit Agreement provided financing through several senior secured credit facilities (collectively, the “senior secured credit facilities”) of up to approximately $7.2 billion, which consisted of $5.7 billion principal amounts of debt outstanding (as detailed in the table above), and $1.5 billion of available borrowing capacity on the revolving credit facility and standby letters of credit.

On September 14, 2021, we repaid $250 million of our term B loans under the senior secured credit facilities using the proceeds from the increased loans under our receivables financing facility.

Receivables Financing Facility

On ~~March 11, 2020, we entered into~~August 13, 2021, the Company amended its receivables financing facility (the “Receivables Amendment”) to extend the term of the facility to October 1, 2024 and to increase the size of the facility to $550 million from $300 million. Under the receivables financing facility, certain of our accounts receivable are sold on a non-recourse basis by certain of our consolidated subsidiaries (each, an ~~amendment~~“Originator”) to another of our consolidated subsidiaries, a bankruptcy-remote special purpose entity (the “SPE”). The SPE obtained a term loan and revolving loan commitment from a third-party lender, secured by liens on the assets of the SPE, to finance the purchase of the accounts receivable, which includes a $440 million term loan and a $110 million revolving loan commitment. Pursuant to the ~~Credit Agreement to borrow $900 million in~~Receivables Amendment, we also added three additional ~~U.S. Dollar denominated term A loans due 2023. The proceeds from the~~subsidiaries as Originators. As of September 30, 2021, no additional ~~term A~~amounts of revolving loans were ~~used to repay outstanding revolving credit loans~~available under ~~our senior secured credit facilities. On March 30, 2020, we prepaid $100 million of~~ the ~~additional term A loans.~~ ~~See Note 8 to our condensed consolidated financial statements included elsewhere in this~~ ~~Quarterly Report on~~ ~~Form 10-Q for additional details regarding our credit arrangements.~~receivables financing facility.

Senior Notes

On ~~June 24, 2020,~~March 3, 2021, we completed the issuance and sale of ~~€711,000,000~~€1,450,000,000 in gross proceeds of the ~~Issuer’s 2.875% senior notes~~Issuer's (i) €550,000,000 aggregate principal amount of its 1.750% Senior Notes due ~~2028~~2026 (the ~~“2.875%~~“2026 Notes”) and (ii) €900,000,000 aggregate principal amount of its 2.250% Senior Notes due 2029 (the “2029 Notes” and, together with the 2026 Notes, the “Notes”). The proceeds from the ~~2.875%~~ Notes offering were used to redeem all of the Issuer’s outstanding ~~3.500%~~3.250% senior notes due ~~2024~~2025 (the ~~“3.500%~~“3.250% Notes”), including the payment of premiums in respect thereof ~~to repay a portion of the existing borrowings under the Issuer’s revolving credit facility~~ and to pay fees and expenses related to the Notes offering. See Note 87 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details regarding our credit arrangements.

As of September 30, ~~2020,~~2021, we had ~~$12.4~~$12.2 billion of total indebtedness, excluding $1.5 billion of additional available borrowings under our revolving credit facility.

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Our long-term debt arrangements contain customary restrictive covenants and, as of September 30, ~~2020,~~2021, we believe we were in compliance with our restrictive covenants in all material respects. ~~We do not have material uncertainty about ongoing ability to meet the covenants of our credit arrangements.~~

Nine months ended September 30, ~~2020~~2021 and ~~2019~~2020

Cash Flow from Operating Activities

Nine Months Ended September 30,
(in millions) 2020 2019
Net cash provided by operating activities $ 1,209 $ 834


	Nine Months Ended September 30,
(in millions)	2021		2020
Net cash provided by operating activities	$	2,250	$	1,209

Cash provided by operating activities increased ~~$375~~$1,041 million during the first nine months of ~~2020~~2021 as compared to the same period in ~~2019.~~2020. The increase was primarily due to higher cash related net income ($682 million), an increase in cash collections from ~~clients~~unearned income ($445 million) and ~~the impact of COVID-19 resulting in a decrease in accounts receivable and unbilled services compared to an increase in the prior period ($495 million), offset by less~~higher cash from other operating assets and liabilities ($9924 million), offset by a decrease in cash from accounts receivable and ~~lower cash-related net income~~unbilled services ($21110 million).

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Cash Flow from Investing Activities

Nine Months Ended September 30,
(in millions) 2020 2019
Net cash used in investing activities $ (560) $ (910)


	Nine Months Ended September 30,
(in millions)	2021		2020
Net cash used in investing activities	$	(1,456)	$	(560)

Cash used in investing activities ~~decreased $350~~increased $896 million during the first nine months of ~~2020~~2021 as compared to the same period in ~~2019. This decrease was~~2020, primarily driven by ~~lower~~more cash used for ~~the acquisition~~acquisitions of businesses ($876 million), acquisitions for property, equipment, and software ($16 million) and lower net payments received from unconsolidated affiliates ($11 million), offset by net proceeds from sale of ~~cash acquired~~equity securities ($~~343~~7 million).

Cash Flow from Financing Activities


	Nine Months Ended September 30,
(in millions)	2021		2020
Net cash used in financing activities	$	(1,097)	$	(19)

Nine Months Ended September 30,
(in millions) 2020 2019
Net cash (used in) provided by financing activities $ (19) $ 67

Cash ~~provided by~~used in financing activities ~~decreased $86~~increased $1,078 million during the first nine months of ~~2020~~2021 as compared to the same period in ~~2019. The decrease~~2020, primarily due to an increase in debt and principal payments ($1,276 million), cash payments for the Company's acquisition of Quest's non-controlling interest in Q2 Solutions ($758 million), an increase in cash ~~provided~~payments on contingent consideration and deferred purchase price accruals ($19 million), and an increase in cash payments related to employee stock option plans ($8 million), offset by ~~financing activities was primarily due to~~ a decrease in cash ~~provided by proceeds from~~used in repayments of revolving credit facilities, net of ~~repayments~~proceeds ($~~140~~470 million), a decrease in cash used to repurchase common stock ($144 million), an increase in cash provided by proceeds from debt issuances, net of repayments and debt issuance costs ($~~212~~353 million), ~~less~~and a decrease in cash ~~proceeds from employee stock option plans~~distributions to non-controlling interests ($5816 million)~~, offset by less cash used to repurchase common stock ($333 million)~~.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Contractual Obligations and Commitments

We have various contractual obligations, which are recorded as liabilities in our consolidated financial statements.

With the exception of ~~new senior secured credit facilities and senior note~~the financing transactions disclosed in Note 87 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, there have been no material changes, outside of the ordinary course of business, to our contractual obligations as previously disclosed in our ~~2019~~2020 Form 10-K.

Application of Critical Accounting Policies

There have been no material changes to our critical accounting policies as previously disclosed in our ~~2019~~2020 Form 10-K.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to our quantitative and qualitative disclosures about market risk as compared to the quantitative and qualitative disclosures about market risk described in our ~~2019~~2020 Form 10-K.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) under the Securities Exchange Act of 1934, as amended (“Exchange Act”) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our CEO and CFO have concluded that as of such date, our disclosure controls and procedures were effective.

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Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the period covered by this Quarterly Report on Form 10-Q that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We are party to legal proceedings incidental to our business. While the outcome of these matters could differ from management’s expectations, we do not believe that the resolution of these matters is reasonably likely to have a material adverse effect to our financial statements.

Information pertaining to legal proceedings can be found in Note 8 to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q and is incorporated by reference herein.

Item 1A. Risk Factors

For a discussion of the risks relating to our business, see Part I—Item 1A—“Risk Factors” of our ~~2019 Form 10-K, as updated in our 1Q~~ 2020 Form ~~10-Q.~~10-K. There have been no material changes from the risk factors previously disclosed in our 1Q 2020 Form ~~10-Q.~~10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

Not applicable.

Use of Proceeds from Registered Securities

Not applicable.

Purchases of Equity Securities by the Issuer

On October 30, 2013, our Board of Directors (the “Board”) approved ~~the Repurchase Program~~an equity repurchase program (the “Repurchase Program”) authorizing the repurchase of up to $125.0 million of either our common stock or vested in-the-money employee stock options, or a combination thereof. Our Board increased the stock repurchase authorization under the Repurchase Program with respect to the repurchase of our common stock by $600 million, $1.5 billion, ~~$2.0~~$2 billion, $1.5 billion, and ~~$2.0~~$2 billion in 2015, 2016, 2017, 2018, and 2019, respectively, which increased the total amount that has been authorized under the Repurchase Program to $7.725 billion. The Repurchase Program does not obligate us to repurchase any particular amount of common stock or vested in-the-money employee stock options, and it may be modified, extended, suspended or discontinued at any time. The timing and amount of repurchases are determined by our management based on a variety of factors such as the market price of our common stock, our corporate requirements, and overall market conditions. Purchases of our common stock may be made in open market transactions effected through a broker-dealer at prevailing market prices, in block trades, or in privately negotiated transactions. The Repurchase Program for common stock does not have an expiration date. In addition, from time to time, we have repurchased and may continue to repurchase common stock through private or other transactions outside of the Repurchase Program.

From inception of the Repurchase Program through September 30, ~~2020,~~2021, we have repurchased a total of ~~$6.7~~$6.6 billion of our securities under the Repurchase Program.

During the nine months ended September 30, ~~2020,~~2021, we repurchased ~~2,106,403~~973,313 shares of our common stock for ~~approximately $321.4~~$221 million under the Repurchase Program. ~~These amounts include 1,000,000 shares of our common stock repurchased from certain Selling Stockholders in a private transaction for an aggregate purchase price of approximately $164.3 million.~~ See Note 9 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details regarding the Repurchase Program.

As of September 30, ~~2020,~~2021, we have remaining authorization to repurchase up to approximately ~~$1.0~~$0.7 billion of our common stock under ~~the Repurchase Program. In addition, from time to time, we have repurchased and may continue to repurchase common stock through private or other transactions outside of~~ the Repurchase Program.

Since the merger between Quintiles and IMS Health, we have repurchased ~~65.0~~66.6 million shares of our common stock at an average market price per share of ~~$96.64~~$99.19 for an aggregate purchase price of ~~$6.3~~$6.6 billion both under and outside of the Repurchase Program. This includes shares withheld from employees to satisfy certain tax obligations due in connection with grants of stock under the Quintiles IMS Holdings, Inc. 2017 Incentive and Stock Award Plan (the “Plan”). The Plan provides for the withholding of shares to satisfy tax obligations. It does not specify a maximum number of shares that can be withheld for this purpose. The shares of common stock withheld to satisfy tax withholding obligations may be deemed to be “issuer purchases” of shares that are required to be disclosed pursuant to this Item.

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The following table summarizes the monthly equity repurchase program activity for the three months ended September 30, ~~2020~~2021 and the approximate dollar value of shares that may yet be purchased pursuant to the Repurchase Program.

~~(in millions, except per share data)~~

~~Total Number of Shares Purchased~~

~~Average Price Paid Per Share~~

~~Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs~~

~~Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs~~

~~July 1, 2020 — July 31, 2020~~

—

~~1,019~~

~~August 1, 2020 — August 30, 2020~~

—

~~1,019~~

~~September 1, 2020 — September 30, 2020~~

—

~~1,019~~

—


(in millions, except per share data)	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs
July 1, 2021 — July 31, 2021	0.1	$	244.30	0.1	$	797
August 1, 2021 — August 31, 2021	0.1	$	248.07	0.1	$	762
September 1, 2021 — September 30, 2021	0.3	$	242.04	0.3	$	697
	0.5			0.5

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Item 6. Exhibits

The exhibits below are filed or furnished as a part of this report and are incorporated herein by reference.

~~Incorporated by Reference~~

Exhibit
Number

~~Exhibit Description~~

Filed
Herewith

~~Form~~

~~File No.~~

~~Exhibit~~

~~Filing Date~~

~~10.1~~

L ~~etter Agreement~~ ~~between the Company and~~ ~~Ronald E. Bruehlman, effective on August 1, 2020.~~

~~31.1~~

~~Certification of Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.~~

~~31.2~~

~~Certification of Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.~~

~~32.1~~

~~Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.~~

~~32.2~~

~~Certification of Executive Vice President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.~~

~~101~~

Interactive Data Files Pursuant to Rule 405 of Regulation S-T: (i) Condensed Consolidated Statements of Income (unaudited), (ii) Condensed Consolidated Statements of Comprehensive Income (unaudited), (iii) Condensed Consolidated Balance Sheets (unaudited), (iv) Condensed Consolidated Statements of Cash Flows (unaudited), (v) Condensed Consolidated Statements of Stockholders’ Equity and (vi) Notes to Condensed Consolidated Financial Statements (unaudited). The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

~~104~~

~~Cover Page Interactive Data File. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.~~

Incorporated by Reference

Exhibit
Number

Exhibit Description

Filed
Herewith

Form

File No.

Exhibit

Filing Date

10.1

Amendment No. 9, dated August 25, 2021, to Fourth Amended and Restated Credit Agreement, dated October 3, 2016, among IQVIA Inc., IQVIA Holdings Inc., IQVIA RDS Inc., IQVIA AG, IQVIA Solutions Japan K.K., the other guarantors party thereto, Bank of America, N.A. as administrative agent and as collateral agent, and the Lenders party thereto.

8-K

001-35907

10.1

August 25, 2021

31.1

Certification of Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of Executive Vice President and Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2

Certification of Executive Vice President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101

Interactive Data Files Pursuant to Rule 405 of Regulation S-T: (i) Condensed Consolidated Statements of Income (unaudited), (ii) Condensed Consolidated Statements of Comprehensive Income (unaudited), (iii) Condensed Consolidated Balance Sheets (unaudited), (iv) Condensed Consolidated Statements of Cash Flows (unaudited), (v) Condensed Consolidated Statements of Stockholders’ Equity (unaudited) and (vi) Notes to Condensed Consolidated Financial Statements (unaudited). The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

104

Cover Page Interactive Data File. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Quarterly Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized on October 22, ~~2020.~~2021.


			IQVIA HOLDINGS INC.

			/s/ Ronald E. Bruehlman

Ronald E. Bruehlman Executive Vice President and ~~Interim~~ Chief Financial Officer (On behalf of the Registrant and as Principal Financial Officer)


(in millions, except per share data)	September 30, 2020		December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	1,464	$	837
Trade accounts receivable and unbilled services, net	2,414		2,582
Prepaid expenses	165		138
Income taxes receivable	78		56
Investments in debt, equity and other securities	79		62
Other current assets and receivables	445		451
Total current assets	4,645		4,126
Property and equipment, net	452		458
Operating lease right-of-use assets	490		496
Investments in debt, equity and other securities	78		65
Investments in unconsolidated affiliates	85		87
Goodwill	12,363		12,159
Other identifiable intangibles, net	5,222		5,514
Deferred income taxes	125		119
Deposits and other assets	377		227
Total assets	$	23,837	$	23,251
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	2,461	$	2,512
Unearned income	1,188		1,014
Income taxes payable	101		108
Current portion of long-term debt	144		100
Other current liabilities	245		211
Total current liabilities	4,139		3,945
Long-term debt	12,195		11,545
Deferred income taxes	429		646
Operating lease liabilities	387		396
Other liabilities	580		456
Total liabilities	17,730		16,988
Commitments and contingencies
Stockholders’ equity:
Common stock and additional paid-in capital, 400.0 shares authorized at September 30, 2020 and December 31, 2019, $0.01 par value, 254.5 shares issued and 191.7 shares outstanding at September 30, 2020; 253.0 shares issued and 192.3 shares outstanding at December 31, 2019	11,070		11,049
Retained earnings	1,158		998
Treasury stock, at cost, 62.8 and 60.7 shares at September 30, 2020 and December 31, 2019, respectively	(6,065)		(5,733)
Accumulated other comprehensive loss	(317)		(311)
Equity attributable to IQVIA Holdings Inc.’s stockholders	5,846		6,003
Non-controlling interests	261		260
Total stockholders’ equity	6,107		6,263
Total liabilities and stockholders’ equity	$	23,837	$	23,251


	Three Months Ended September 30, 2019
(in millions)		Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Total
Revenues:
Americas		$	580	$	726	$	104	$	1,410
Europe and Africa		369		394		48		811
Asia-Pacific		146		346		56		548
Total revenues		$	1,095	$	1,466	$	208	$	2,769



	Nine Months Ended September 30, 2019
(in millions)		Technology & Analytics Solutions		Research & Development Solutions		Contract Sales & Medical Solutions		Total
Revenues:
Americas		$	1,722	$	2,009	$	298	$	4,029
Europe and Africa		1,128		1,298		148		2,574
Asia-Pacific		422		1,010		158		1,590
Total revenues		$	3,272	$	4,317	$	604	$	8,193


(in millions)	Classification	Three Months Ended September 30, 2020		Three Months Ended September 30, 2019
Operating lease cost ⁽¹⁾	Selling, general and administrative expenses	$	49	$	48
Finance lease cost ⁽¹⁾	Depreciation and amortization, and Interest expense	3		0
Total lease cost		$	52	$	48


(in millions)	Operating Leases		Finance Leases
Remainder of 2020	$	44	$	0
2021	153		0
2022	128		6
2023	100		6
2024	70		6
2025	56		6
Thereafter	44		159
Total future minimum lease payments	595		183
Less imputed interest	(54)		(63)
Total	$	541	$	120
Reported as of September 30, 2020:
Other current liabilities	$	154	$	—
Operating lease liabilities	387		—
Other liabilities	—		120
Total	$	541	$	120