Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Jan. 31, 2015 | Jun. 30, 2014 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | SYK | ||
Entity Registrant Name | STRYKER CORP | ||
Entity Central Index Key | 310764 | ||
Current Fiscal Year End Date | -19 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 378,749,951 | ||
Entity Current Reporting Status | No | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Public Float | $29,425,287,926 |
Consolidated_Statements_Of_Ear
Consolidated Statements Of Earnings (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Statement [Abstract] | |||
Net sales | $9,675 | $9,021 | $8,657 |
Cost of sales | 3,291 | 2,977 | 2,781 |
Gross profit | 6,384 | 6,044 | 5,876 |
Research, development and engineering expenses | 614 | 536 | 471 |
Selling, general and administrative expenses | 3,575 | 3,492 | 3,367 |
Recall charges, net of insurance recoveries | 761 | 622 | 174 |
Intangible asset amortization | 188 | 138 | 123 |
Total operating expenses | 5,138 | 4,788 | 4,135 |
Operating income | 1,246 | 1,256 | 1,741 |
Other income (expense), net | -86 | -44 | -36 |
Earnings before income taxes | 1,160 | 1,212 | 1,705 |
Income taxes | 645 | 206 | 407 |
Net earnings | $515 | $1,006 | $1,298 |
Net earnings per share of common stock: | |||
Basic net earnings per share of common stock (in dollars per share) | $1.36 | $2.66 | $3.41 |
Diluted net earnings per share of common stock (in dollars per share) | $1.34 | $2.63 | $3.39 |
Weighted-average shares outstanding—in millions: | |||
Basic (in shares) | 378.5 | 378.6 | 380.6 |
Net effect of dilutive employee stock options (in shares) | 4.3 | 3.5 | 2.4 |
Diluted (in shares) | 382.8 | 382.1 | 383 |
Anti-dilutive shares excluded from the calculation of net effect of dilutive employee stock options (in shares) | 6.4 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Comprehensive Income [Abstract] | |||
Net earnings | $515 | $1,006 | $1,298 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Marketable securities | 3 | -4 | 4 |
Pension plans | -55 | 20 | -69 |
Unrealized gains on designated hedges | 6 | 7 | 0 |
Financial statement translation | -440 | 80 | 50 |
Total other comprehensive (loss) income, net of tax | -486 | 103 | -15 |
Comprehensive income | $29 | $1,109 | $1,283 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current assets | ||
Cash and cash equivalents | $1,795 | $1,339 |
Marketable securities | 3,205 | 2,641 |
Accounts receivable, less allowance of $59 ($72 in 2013) | 1,572 | 1,518 |
Inventories | ||
Materials and supplies | 248 | 227 |
Work in process | 88 | 85 |
Finished goods | 1,252 | 1,110 |
Total inventories | 1,588 | 1,422 |
Deferred income taxes | 989 | 880 |
Prepaid expenses and other current assets | 524 | 535 |
Total current assets | 9,673 | 8,335 |
Property, plant and equipment | ||
Land, buildings and improvements | 678 | 686 |
Machinery and equipment | 1,919 | 1,811 |
Total property, plant and equipment | 2,597 | 2,497 |
Less accumulated depreciation | 1,499 | 1,416 |
Net property, plant and equipment | 1,098 | 1,081 |
Other assets | ||
Goodwill | 4,186 | 3,844 |
Other intangibles, net | 2,018 | 1,989 |
Other | 738 | 494 |
Total assets | 17,713 | 15,743 |
Current liabilities | ||
Accounts payable | 329 | 314 |
Accrued compensation | 597 | 535 |
Income taxes | 333 | 131 |
Dividend payable | 131 | 115 |
Accrued recall expenses | 1,593 | 772 |
Accrued expenses and other liabilities | 754 | 765 |
Current maturities of debt | 727 | 25 |
Total current liabilities | 4,464 | 2,657 |
Long-term debt, excluding current maturities | 3,246 | 2,739 |
Other liabilities | 1,408 | 1,300 |
Shareholders' equity | ||
Common stock, $0.10 par value: Authorized: 1 billion shares, Outstanding: 378 million shares (378 million in 2013) | 38 | 38 |
Additional paid-in capital | 1,252 | 1,160 |
Retained earnings | 7,559 | 7,617 |
Accumulated other comprehensive income | -254 | 232 |
Total shareholders' equity | 8,595 | 9,047 |
Total liabilities & shareholders' equity | $17,713 | $15,743 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parentheticals) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $59 | $72 |
Common stock, par value (in dollars per share) | $0.10 | $0.10 |
Common stock, authorized (in shares) | 1,000 | 1,000 |
Common stock, outstanding (in shares) | 378 | 378 |
Consolidated_Statements_Of_Sha
Consolidated Statements Of Shareholders' Equity (USD $) | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
In Millions | |||||
Balances at Dec. 31, 2011 | $7,683 | $38 | $1,022 | $6,479 | $144 |
Net earnings | 1,298 | 1,298 | |||
Other comprehensive loss | -15 | -15 | |||
Issuance of shares of common stock under stock option and benefit plans, including excess income tax benefit | 7 | 7 | |||
Repurchase and retirement of common stock | -108 | -6 | -102 | ||
Share-based compensation | 75 | 75 | |||
Cash dividends declared of common stock | -343 | -343 | |||
Balances at Dec. 31, 2012 | 8,597 | 38 | 1,098 | 7,332 | 129 |
Net earnings | 1,006 | 1,006 | |||
Other comprehensive loss | 103 | 103 | |||
Issuance of shares of common stock under stock option and benefit plans, including excess income tax benefit | -1 | -1 | |||
Repurchase and retirement of common stock | -317 | -13 | -304 | ||
Share-based compensation | 76 | 76 | |||
Cash dividends declared of common stock | -417 | -417 | |||
Balances at Dec. 31, 2013 | 9,047 | 38 | 1,160 | 7,617 | 232 |
Net earnings | 515 | 515 | |||
Other comprehensive loss | -486 | -486 | |||
Issuance of shares of common stock under stock option and benefit plans, including excess income tax benefit | 19 | 19 | |||
Repurchase and retirement of common stock | -100 | -4 | -96 | ||
Share-based compensation | 77 | 77 | |||
Cash dividends declared of common stock | -477 | -477 | |||
Balances at Dec. 31, 2014 | $8,595 | $38 | $1,252 | $7,559 | ($254) |
Consolidated_Statements_Of_Sha1
Consolidated Statements Of Shareholders' Equity (Parenthetical) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Stockholders' Equity [Abstract] | |||
Issuance of common stock under stock option and benefit plans, shares | 2.2 | 2.1 | 1.5 |
Issuance of common stock under stock option and benefit plans, excess income tax benefit | $7 | $6 | $1 |
Repurchase and retirement of common stock, shares | 1.3 | 4.8 | 2.1 |
Cash dividends declared, per share of common stock | $1.26 | $1.10 | $0.90 |
Consolidated_Statements_Of_Cas
Consolidated Statements Of Cash Flows (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Operating activities | |||
Net earnings | $515 | $1,006 | $1,298 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Depreciation | 190 | 169 | 154 |
Amortization of intangible assets | 188 | 138 | 123 |
Share-based compensation | 77 | 76 | 75 |
Gross recall charges | 940 | 622 | 174 |
Sale of inventory stepped up to fair value at acquisition | 27 | 28 | 18 |
Deferred income tax benefit | 60 | 23 | -39 |
Changes in operating assets and liabilities, net of effects of acquisitions: | |||
Accounts receivable | -89 | -89 | -20 |
Inventories | -173 | -77 | 18 |
Accounts payable | 13 | 1 | -48 |
Accrued expenses and other liabilities | 92 | 41 | 9 |
Recall related payments | -98 | -6 | -3 |
Income taxes | 133 | -124 | -159 |
Other | -93 | 78 | 57 |
Net cash provided by operating activities | 1,782 | 1,886 | 1,657 |
Investing activities | |||
Acquisitions, net of cash acquired | -916 | -2,320 | -154 |
Purchases of marketable securities | -4,365 | -4,558 | -3,480 |
Proceeds from sales of marketable securities | 3,636 | 4,856 | 3,108 |
Purchases of property, plant and equipment | -233 | -195 | -210 |
Net cash used in investing activities | -1,878 | -2,217 | -736 |
Financing activities | |||
Proceeds from borrowings | 1,601 | 369 | 178 |
Payments on borrowings | -1,428 | -355 | -182 |
Proceeds from issuance of long-term debt, net | 986 | 991 | |
Dividends paid | -462 | -401 | -324 |
Repurchase and retirement of common stock | -100 | -317 | -108 |
Other financing | 32 | 13 | -13 |
Net cash provided by (used in) financing activities | 629 | 300 | -449 |
Effect of exchange rate changes on cash and cash equivalents | -77 | -25 | 18 |
Change in cash and cash equivalents | 456 | -56 | 490 |
Cash and cash equivalents at beginning of year | 1,339 | 1,395 | 905 |
Cash and cash equivalents at end of year | 1,795 | 1,339 | 1,395 |
Supplemental cash flow disclosure: | |||
Cash paid for income taxes, net of refunds | $437 | $321 | $599 |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2014 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | SIGNIFICANT ACCOUNTING POLICIES |
Nature of Operations: Stryker Corporation (the "Company," "we," "us," or "our") is one of the world's leading medical technology companies. Our products include implants used in joint replacement and trauma surgeries; surgical equipment and surgical navigation systems; endoscopic and communications systems; patient handling and emergency medical equipment; neurosurgical, neurovascular and spinal devices; as well as other medical device products used in a variety of medical specialties. | |
Basis of Presentation and Consolidation: The Consolidated Financial Statements include the Company and its subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. We have no material interests in variable interest entities and none that require consolidation. Certain prior year amounts have been reclassified to conform with the presentation of our consolidated statements of earnings in 2014. | |
Use of Estimates: Preparation of financial statements in conformity with accounting principles generally accepted in the United States (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying disclosures. These estimates are based on management's best knowledge of current events and actions we may undertake in the future. Estimates are used in accounting for, among other items, pensions, stock options, valuation of acquired intangible assets, useful lives for depreciation and amortization of long-lived assets, future cash flows associated with impairment testing for goodwill, indefinite-lived intangible assets and other long-lived assets, excess and obsolete inventory, deferred tax assets and liabilities, uncertain income tax positions and contingencies. Actual results may ultimately differ from estimates. | |
Revenue Recognition: Sales are recognized when revenue is realized or realizable and has been earned. Our policy is to recognize revenue when title to the product, ownership and risk of loss transfer to the customer, which can be on the date of shipment, the date of receipt by the customer or, for most orthopaedics products, when we receive appropriate notification that the product has been used or implanted. A provision for estimated sales returns, discounts, rebates and other sales incentives is recorded as a reduction of net sales in the same period that the revenue is recognized. Shipping and handling costs charged to customers are included in net sales. | |
Cost of Sales: Cost of sales is primarily comprised of direct materials and supplies consumed in the manufacture of product, as well as manufacturing labor, depreciation expense and direct overhead expense necessary to acquire and convert the purchased materials and supplies into finished product. Cost of sales also includes the cost to distribute products to customers, inbound freight costs, warehousing costs and other shipping and handling activity. | |
Research, Development and Engineering Expenses: Research and development costs are charged to expense as incurred. Costs include research, development and engineering activities relating to the development of new products, improvement of existing products, technical support of products and compliance with governmental regulations for the protection of customers and patients. Costs primarily consist of salaries, wages, consulting and depreciation and maintenance of research facilities and equipment. | |
Selling, General and Administrative Expenses: Selling, general and administrative expense is primarily comprised of selling expenses, marketing expenses, administrative and other indirect overhead costs, amortization of loaner instrumentation, depreciation and amortization expense of non-manufacturing assets and other miscellaneous operating items. | |
Currency Translation: Financial statements of subsidiaries outside the United States generally are measured using the local currency as the functional currency. Adjustments to translate those statements into United States dollars are recorded in other comprehensive income (OCI). Transactional exchange gains and losses are included in earnings. | |
Cash Equivalents: Highly liquid investments with remaining stated maturities of three months or less when purchased are considered cash equivalents and recorded at cost. | |
Marketable Securities: Marketable securities consist of marketable debt securities, certificates of deposit and mutual funds. Mutual funds are acquired to offset changes in certain liabilities related to deferred compensation arrangements and are expected to be used to settle these liabilities. Pursuant to our investment policy, all individual marketable security investments must have a minimum credit quality of single A (per Standard & Poor’s and Fitch) and A2 (per Moody’s Corporation) at the time of acquisition, while the overall portfolio of marketable securities must maintain a minimum average credit quality of double A (per Standard & Poor’s and Fitch) or Aa (per Moody’s Corporation). In the event of a rating downgrade below the minimum credit quality subsequent to purchase, the marketable security investment is evaluated to determine the appropriate action to take to minimize the overall risk to our marketable security investment portfolio. Our marketable securities are classified as available-for-sale and trading securities. | |
Accounts Receivable: Accounts receivable consists of trade and other miscellaneous receivables. An allowance is maintained for doubtful accounts for estimated losses in the collection of accounts receivable. Estimates are made regarding the ability of customers to make required payments based on historical credit experience and expected future trends. Accounts receivable are written off when all reasonable collection efforts are exhausted. | |
Inventories: Inventories are stated at the lower of cost or market, with cost generally determined using the first-in, first-out (FIFO) cost method. For excess and obsolete inventory resulting from the potential inability to sell specific products at prices in excess of current carrying costs, reserves are maintained to reduce current carrying cost to market prices. | |
Financial Instruments: Our financial instruments consist of cash, cash equivalents, marketable securities, accounts receivable, other investments, accounts payable, debt and foreign currency exchange contracts. With the exception of our long-term debt, which is discussed in further detail in Note 8, our estimates of fair value for financial instruments approximate their carrying amounts as of December 31, 2014 and 2013. | |
All marketable securities are recognized at fair value. Adjustments to the fair value of marketable securities that are classified as available-for-sale are recorded as increases or decreases, net of income taxes, within accumulated other comprehensive income (AOCI) in shareholders’ equity and adjustments to the fair value of marketable securities that are classified as trading are recorded in earnings. The amortized cost of marketable debt securities is adjusted for amortization of premiums and discounts to maturity computed under the effective interest method. Such amortization is included in other income (expense) along with interest and realized gains and losses. The cost of securities sold is determined by the specific identification method. | |
We review declines in the fair value of our investments classified as available-for-sale for impairment to determine whether the decline in fair value is an other-than-temporary impairment. The resulting losses from other-than-temporary impairments of available-for-sale marketable securities are included in earnings. | |
Derivatives: All derivatives are recognized at fair value and reported on a gross basis. We enter into forward currency exchange contracts to mitigate the impact of currency fluctuations on transactions denominated in nonfunctional currencies, thereby limiting our risk that would otherwise result from changes in exchange rates. These nonfunctional currency exposures principally relate to intercompany receivables and payables arising from intercompany purchases of manufactured products. The periods of the forward currency exchange contracts correspond to the periods of the exposed transactions, with realized gains and losses included in the measurement and recording of transactions denominated in the nonfunctional currencies. All forward currency exchange contracts are recorded at their fair value each period, with resulting gains (losses) included in earnings. | |
Forward currency exchange contracts designated as cash flow hedges are designed to hedge the variability of cash flows associated with forecasted transactions denominated in a foreign currency that will take place in the future. Changes in value of derivatives designated as cash flow hedges are recorded in AOCI on the consolidated balance sheets until earnings are affected by the variability of the underlying cash flows. At that time, the applicable amount of gain or loss from the derivative instrument that is deferred in shareholders’ equity is reclassified into earnings and is included in other income (expense) or cost of goods sold in the consolidated statements of earnings, depending on the underlying transaction that is being hedged. We report our derivative instruments on a gross basis. | |
Interest rate derivative instruments designated as fair value hedges are being used to manage the exposure to interest rate movements and to reduce borrowing costs by converting fixed-rate debt into floating-rate debt. Under these agreements, we agree to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount. | |
Property, Plant and Equipment: Property, plant and equipment is stated at cost. Depreciation is generally computed by the straight-line method over the estimated useful lives of three to 30 years for buildings and improvements and three to ten years for machinery and equipment. | |
Goodwill and Other Intangible Assets: Goodwill represents the excess of purchase price over fair value of tangible net assets of acquired businesses at the acquisition date, after amounts allocated to other identifiable intangible assets. Factors that contribute to the recognition of goodwill include securing synergies that are specific to our business and not available to other market participants and are expected to increase revenues and profits; acquisition of a talented workforce; cost savings opportunities; the strategic benefit of expanding our presence in core and adjacent markets; and diversifying our product portfolio. | |
The fair values of other identifiable intangible assets are primarily determined using the income approach. Other intangible assets include, but are not limited to, developed technology, customer and distributor relationships (which reflect expected continued customer or distributor patronage) and trademarks and patents. Intangible assets with determinable useful lives are amortized on a straight-line basis over their estimated useful lives of four to 40 years. Certain acquired trade names are considered to have indefinite lives and are not amortized, but are assessed annually for potential impairment as described below. | |
In certain of our acquisitions, we acquire in-process research and development (IPRD) intangible assets. IPRD is considered to be an indefinite-lived intangible asset until such time as the research is completed (at which time it becomes a determinable-lived intangible asset) or determined to have no future use (at which time it is impaired). | |
Goodwill, Intangibles and Long-Lived Asset Impairment Tests: We perform our annual impairment test for goodwill in the fourth quarter of each year. We consider qualitative indicators of the fair value of a reporting unit when it is unlikely that a reporting unit has impaired goodwill. In certain circumstances, we may also utilize a discounted cash flow analysis that requires certain assumptions and estimates be made regarding market conditions and our future profitability. Indefinite-lived intangible assets are also tested at least annually for impairment by comparing the individual carrying values to the fair value. | |
We review long-lived assets for indicators of impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The evaluation is performed at the lowest level of identifiable cash flows. Undiscounted cash flows expected to be generated by the related assets are estimated over the asset's useful life based on updated projections. If the evaluation indicates that the carrying amount of the asset may not be recoverable, any potential impairment is measured based upon the fair value of the related asset or asset group as determined by an appropriate market appraisal or other valuation technique. Assets classified as held for sale are recorded at the lower of carrying amount or fair value less costs to sell. | |
Share-Based Compensation: We utilize share based compensation in the form of stock options, restricted stock units (RSUs) and performance-based restricted stock units (PSUs). Compensation expense is recognized in the Consolidated Statements of Earnings based on the estimated fair value of the awards at grant date. Compensation expense recognized reflects an estimate of the number of awards expected to vest after taking into consideration an estimate of award forfeitures based on actual experience and is recognized on a straight-line basis over the requisite service period, which is generally the period required to obtain full vesting. Management expectations related to the achievement of performance goals associated with PSU grants is assessed regularly and that assessment is used to determine whether PSU grants are expected to vest. If performance-based milestones related to PSU grants are not met or not expected to be met, any compensation expense recognized to date associated with grants that are not expected to vest will be reversed. | |
Income Taxes: Deferred income tax assets and liabilities are determined based on differences between financial reporting and income tax bases of assets and liabilities and are measured using the enacted income tax rates in effect for the years in which the differences are expected to reverse. Deferred income tax benefits generally represent the change in net deferred income tax assets and liabilities during the year. Other amounts result from adjustments related to acquisitions as appropriate. | |
We operate in multiple income tax jurisdictions both within the United States and internationally. Accordingly, management must determine the appropriate allocation of income to each of these jurisdictions based on current interpretations of complex income tax regulations. Income tax authorities in these jurisdictions regularly perform audits of our income tax filings. Income tax audits associated with the allocation of this income and other complex issues, including inventory transfer pricing and cost sharing, product royalty and foreign branch arrangements, may require an extended period of time to resolve and may result in significant income tax adjustments if changes to the income allocation are required between jurisdictions with different income tax rates. | |
New Accounting Pronouncements Not Yet Adopted: In May 2014, the FASB issued Accounting Standard Update (ASU) No. 2014-09, Revenue from Contracts with Customers, which supersedes and replaces nearly all currently-existing United States GAAP revenue recognition guidance including related disclosure requirements. This guidance will be effective for us beginning January 1, 2017. We have not yet completed our assessment of the impact that adoption of this guidance will have on our financial statements. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Income (AOCI) Accumulated Other Comprehensive Income (AOCI) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Reclassification Adjustments Out of Accumulated Other Comprehensive Income (AOCI) [Abstract] | ||||||||
Accumulated Other Comprehensive Income (AOCI) | ACCUMULATED OTHER COMPREHENSIVE INCOME (AOCI) | |||||||
Changes in and reclassifications out of AOCI, net of tax, for the years ended December 31, 2014 and 2013 were: | ||||||||
2014 | 2013 | |||||||
Marketable Securities - Beginning | $ | — | $ | 4 | ||||
Other comprehensive income (OCI) | 12 | 16 | ||||||
Income tax expense on OCI | (2 | ) | 1 | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | — | — | ||||||
Other (income) expense | (9 | ) | (21 | ) | ||||
Income tax expense (benefit) | 2 | — | ||||||
Total other comprehensive income | 3 | (4 | ) | |||||
Marketable Securities - Ending | $ | 3 | $ | — | ||||
Pension Plans - Beginning | $ | (81 | ) | $ | (101 | ) | ||
Other comprehensive income (OCI) | (72 | ) | 30 | |||||
Income tax expense on OCI | 22 | (15 | ) | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | (6 | ) | 7 | |||||
Other (income) expense | — | — | ||||||
Income tax expense (benefit) | 1 | (2 | ) | |||||
Total other comprehensive income | (55 | ) | 20 | |||||
Pension Plans - Ending | $ | (136 | ) | $ | (81 | ) | ||
Hedges - Beginning | $ | 7 | $ | — | ||||
Other comprehensive income (OCI) | 10 | 8 | ||||||
Income tax expense on OCI | (4 | ) | 4 | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | (1 | ) | (9 | ) | ||||
Other (income) expense | — | — | ||||||
Income tax expense (benefit) | 1 | 4 | ||||||
Total other comprehensive income | 6 | 7 | ||||||
Hedges - Ending | $ | 13 | $ | 7 | ||||
Financial Statement Translation - Beginning | $ | 306 | $ | 226 | ||||
Other comprehensive income (OCI) | (440 | ) | 80 | |||||
Financial Statement Translation - Ending | $ | (134 | ) | $ | 306 | |||
AOCI - Beginning | $ | 232 | $ | 129 | ||||
Other comprehensive income (OCI) | (490 | ) | 134 | |||||
Income tax expense on OCI | 16 | (10 | ) | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | (7 | ) | (2 | ) | ||||
Other (income) expense | (9 | ) | (21 | ) | ||||
Income tax expense (benefit) | 4 | 2 | ||||||
Total other comprehensive income | (486 | ) | 103 | |||||
AOCI - Ending | $ | (254 | ) | $ | 232 | |||
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Fair Value Disclosures [Abstract] | ||||||||
Fair Value Measurements | FAIR VALUE MEASUREMENTS | |||||||
Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: | ||||||||
Level 1 | Quoted market prices in active markets for identical assets or liabilities. | |||||||
Level 2 | Observable market-based inputs or unobservable inputs that are corroborated by market data. | |||||||
Level 3 | Unobservable inputs reflecting our assumptions or external inputs from active markets. | |||||||
When applying fair value principles in the valuation of assets and liabilities, we are required to maximize the use of quoted market prices and minimize the use of unobservable inputs. We calculate the fair value of our Level 1 and Level 2 instruments based on the exchange traded price of similar or identical instruments, where available, or based on other observable inputs. There were no significant transfers into or out of Level 1 or Level 2 that occurred between December 31, 2014 and December 31, 2013. The fair value of our Level 3 assets and liabilities are calculated as the net present value of expected cash flows based on externally provided or obtained inputs. Certain Level 3 assets may also be based on sale prices of similar assets. Our fair value calculations take into consideration our credit risk and that of our counterparties. Should a counterparty default, our maximum exposure to loss is the asset balance of the instrument. We did not change our valuation techniques used in measuring the fair value of any financial assets and liabilities during the year. | ||||||||
Our valuation of our assets and liabilities measured at fair value at December 31, 2014 and 2013 is: | ||||||||
2014 | 2013 | |||||||
Cash and cash equivalents | $ | 1,795 | $ | 1,339 | ||||
Trading marketable securities | 80 | 72 | ||||||
Level 1 - Assets | 1,875 | 1,411 | ||||||
Available-for-sale marketable securities | ||||||||
Corporate and asset-backed debt securities | 1,525 | 1,177 | ||||||
Foreign government debt securities | 726 | 845 | ||||||
United States agency debt securities | 382 | 211 | ||||||
United States treasury debt securities | 474 | 350 | ||||||
Certificates of deposit | 110 | 53 | ||||||
Other | 12 | 5 | ||||||
Total available-for-sale marketable securities | 3,229 | 2,641 | ||||||
Foreign currency exchange forward contracts | 32 | 25 | ||||||
Interest rate swap asset | 10 | — | ||||||
Level 2 - Assets | 3,271 | 2,666 | ||||||
Total assets measured at fair value | $ | 5,146 | $ | 4,077 | ||||
Deferred compensation arrangements | $ | 80 | $ | 72 | ||||
Level 1 - Liabilities | 80 | 72 | ||||||
Foreign currency exchange forward contracts | 12 | 2 | ||||||
Level 2 - Liabilities | 12 | 2 | ||||||
Contingent consideration | ||||||||
Beginning Balance | 59 | 103 | ||||||
Losses (Gains) included in earnings | 4 | (5 | ) | |||||
Settlements | (15 | ) | (39 | ) | ||||
Ending Balance | 48 | 59 | ||||||
Level 3 - Liabilities | 48 | 59 | ||||||
Total liabilities measured at fair value | $ | 140 | $ | 133 | ||||
The cost and estimated fair value of available-for-sale marketable securities at December 31, 2014 by contractual maturity are: | ||||||||
2014 | ||||||||
Cost | Estimated Fair Value | |||||||
Due in one year or less | $ | 430 | $ | 430 | ||||
Due after one year through three years | 2,502 | 2,505 | ||||||
Due after three years | 294 | 294 | ||||||
Summary of marketable securities: | December | December | ||||||
2014 | 2013 | |||||||
Amortized Cost | ||||||||
Available-for-sale marketable securities: | ||||||||
Corporate and asset-backed debt securities | $ | 1,523 | $ | 1,177 | ||||
Foreign government debt securities | 725 | 846 | ||||||
United States agency debt securities | 382 | 211 | ||||||
United States treasury debt securities | 474 | 350 | ||||||
Certificates of deposit | 110 | 53 | ||||||
Other | 12 | 5 | ||||||
Gross Unrealized Gains | ||||||||
Corporate and asset-backed debt securities | $ | 3 | $ | 1 | ||||
Foreign government debt securities | 2 | — | ||||||
United States agency debt securities | — | — | ||||||
United States treasury debt securities | — | — | ||||||
Certificates of deposit | — | — | ||||||
Other | — | — | ||||||
Gross Unrealized Losses | ||||||||
Corporate and asset-backed debt securities | $ | (1 | ) | $ | (1 | ) | ||
Foreign government debt securities | (1 | ) | (1 | ) | ||||
United States agency debt securities | — | — | ||||||
United States treasury debt securities | — | — | ||||||
Certificates of deposit | — | — | ||||||
Other | — | — | ||||||
Estimated Fair Value | ||||||||
Corporate and asset-backed debt securities | $ | 1,525 | $ | 1,177 | ||||
Foreign government debt securities | 726 | 845 | ||||||
United States agency debt securities | 382 | 211 | ||||||
United States treasury debt securities | 474 | 350 | ||||||
Certificates of deposit | 110 | 53 | ||||||
Other | 12 | 5 | ||||||
Total available-for-sale marketable securities | $ | 3,229 | $ | 2,641 | ||||
Trading marketable securities | 80 | 72 | ||||||
Total marketable securities | $ | 3,309 | $ | 2,713 | ||||
Reported as: | ||||||||
Current assets-marketable securities | $ | 3,205 | $ | 2,641 | ||||
Current assets-prepaid expenses and other current assets | $ | 24 | $ | — | ||||
Noncurrent assets-other | $ | 80 | $ | 72 | ||||
At December 31, 2014, $24 of interest receivable related to our marketable securities portfolio was recorded in "Prepaid expenses and other current assets." The estimated fair value of the liability for contingent consideration represents milestone payments for acquisitions. The fair value of the liability was estimated using a discounted cash flow technique. Significant unobservable inputs to this technique included our probability assessments of occurrence of triggering events, appropriately discounted considering the uncertainties associated with the obligation. We remeasure this liability each reporting period and record the changes in the fair value in general and administrative expense (for probability of occurrence) and other income (expense) (for changes in time value of money) in earnings. | ||||||||
The fair value and probability assessments of occurrence of triggering events for contingent consideration fair value measurements classified in Level 3 at December 31, 2014 were: | ||||||||
Probability Range | ||||||||
Fair Value | Minimum | Maximum | Weighted Average | |||||
48 | 85 | 100 | 95 | |||||
The unrealized losses on our available-for-sale marketable securities were primarily caused by increases in yields as a result of changing conditions in the global credit markets. While some of these investments have been downgraded by rating agencies since their initial purchase, less than 1% of our investments in available-for-sale marketable securities had a credit quality rating of less than single A (per Standard & Poors and Fitch) and A2 (per Moody's). Because we do not intend to sell the investments and it is not more likely than not that we will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, we do not consider these investments to be other-than-temporarily impaired at December 31, 2014. | ||||||||
The gross unrealized losses and fair value of our investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at December 31, 2014, are as follows: | ||||||||
Number of Investments | Fair Value | Unrealized Losses | ||||||
Less than 12 months | ||||||||
Corporate and Asset-Backed | 716 | $ | 1,515 | $ | (1 | ) | ||
Foreign Government | 142 | 711 | (1 | ) | ||||
United States Agency | 91 | 382 | — | |||||
Other | 164 | 596 | — | |||||
1,113 | $ | 3,204 | $ | (2 | ) | |||
Total | ||||||||
Corporate and Asset-Backed | 722 | $ | 1,525 | $ | (1 | ) | ||
Foreign Government | 147 | 726 | (1 | ) | ||||
United States Agency | 91 | 382 | — | |||||
Other | 164 | 596 | — | |||||
1,124 | $ | 3,229 | $ | (2 | ) | |||
Interest and marketable securities income totaled $28, $24, and $47 in 2014, 2013, and 2012, respectively, and is included in other income (expense). |
Derivative_Instruments
Derivative Instruments | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||
Derivative Instruments | DERIVATIVE INSTRUMENTS | ||||||||||||
We use operational and economic hedges as well as foreign currency exchange forward contracts and interest rate derivative instruments to manage the impact of currency exchange on earnings and cash flow. At the inception of the forward contract, the derivative is designated as a cash flow hedge or is a free standing derivative. We do not enter into currency exchange derivative instruments for speculative purposes. | |||||||||||||
Derivative Instruments Not Designated as Hedges | |||||||||||||
Derivative forward contracts are used to offset our exposure to the change in value of specific foreign currency denominated assets and liabilities. These derivatives are not designated as hedges and, therefore, changes in the value of these forward contracts are recognized in earnings, thereby offsetting the current earnings effect of the related changes in value of foreign currency denominated assets and liabilities. The estimated fair value of our forward currency exchange contracts represents the measurement of the contracts at month-end spot rates as adjusted by current forward points. | |||||||||||||
Cash Flow Hedges | |||||||||||||
We use a layered hedging program to hedge select anticipated foreign currency cash flows to reduce volatility in both cash flows and reported earnings. These foreign exchange contracts generally have maturities up to eighteen months. For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative is reported as a component of AOCI and reclassified into other income (expense) or cost of sales within earnings in the same period during which the hedged transaction affects earnings. In 2013 a gain of $9 was reclassified from AOCI to earnings relating to the discontinuance of certain cash flow hedges, as we considered it probable that the original forecasted transactions would not occur. Cash flows associated with these hedges are included in cash from operations in the same category as the cash flows from the items being hedged. | |||||||||||||
The gross notional, maximum term and gross fair value amounts of foreign exchange forward contract derivatives designated and non-designated as hedging instruments are: | |||||||||||||
Designated | Non-Designated | Total | |||||||||||
December 31, 2014 | |||||||||||||
Gross Notional Amount | $ | 357 | $ | 2,085 | $ | 2,442 | |||||||
Maximum term in days | 546 | ||||||||||||
Fair Value | |||||||||||||
Other Current Assets | $ | 18 | $ | 12 | $ | 30 | |||||||
Other Noncurrent Assets | 2 | — | 2 | ||||||||||
Other Current Liabilities | — | 12 | 12 | ||||||||||
$ | 20 | $ | — | $ | 20 | ||||||||
December 31, 2013 | |||||||||||||
Gross Notional Amount | $ | 344 | $ | 2,000 | $ | 2,344 | |||||||
Maximum term in days | 546 | ||||||||||||
Fair Value | |||||||||||||
Other Current Assets | $ | 11 | $ | 10 | $ | 21 | |||||||
Other Noncurrent Assets | 1 | 3 | 4 | ||||||||||
Other Current Liabilities | 1 | 1 | 2 | ||||||||||
$ | 11 | $ | 12 | $ | 23 | ||||||||
We are exposed to credit loss in the event of nonperformance by counterparties on our outstanding forward currency exchange contracts but do not anticipate nonperformance by any of our counterparties. Should a counterparty default, our maximum exposure to loss is the asset balance of the instrument. | |||||||||||||
Recognized foreign currency transaction gains (losses) included in earnings were: | |||||||||||||
Recorded In: | 2014 | 2013 | 2012 | ||||||||||
Cost of goods sold | $ | 1 | $ | — | $ | — | |||||||
Other income (expense) | (8 | ) | 3 | (7 | ) | ||||||||
Total | $ | (7 | ) | $ | 3 | $ | (7 | ) | |||||
At December 31, 2014 and December 31, 2013, pretax gains on derivatives designated as hedges of $15 and $12, which are recorded in AOCI, are expected to be reclassified to earnings during the next 12 months. This reclassification is primarily due to the sale of inventory that includes previously hedged purchases. | |||||||||||||
Fair Value Hedges | |||||||||||||
Interest rate derivative instruments designated as fair value hedges are being used to manage the exposure to interest rate movements and to reduce borrowing costs by converting fixed-rate debt into floating-rate debt. Under these agreements, we agree to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount. | |||||||||||||
At December 31, 2014, we had interest rate swaps in gross notional amounts of $500 designated as fair value hedges of underlying fixed rate obligations representing a portion of our $600 senior unsecured notes due in 2024. The market value of outstanding interest rate swap agreements at December 31, 2014 was a recognized gain of $10 which is recorded in other long-term assets with an offsetting recognized loss of $10 on the fair value of the underlying fixed rate obligation recorded in long-term debt in the consolidated balance sheet. No hedge ineffectiveness was recorded as a result of these fair value hedges in 2014. |
Acquisitions
Acquisitions | 12 Months Ended | ||||||||||||||
Dec. 31, 2014 | |||||||||||||||
Business Combinations [Abstract] | |||||||||||||||
Acquisitions | ACQUISITIONS | ||||||||||||||
2014 Acquisitions | |||||||||||||||
During September 2014 we acquired the assets of Small Bone Innovations, Inc. (SBi) for an aggregate purchase price of approximately $358. SBi products are designed and promoted for upper and lower extremity small bone indications, with a focus on small joint replacement. The acquisition of the assets of SBi enhances our product offerings within our Orthopaedics segment. Intangible assets acquired with SBi will be amortized over a weighted-average life of 12 years. | |||||||||||||||
In April 2014 we acquired Berchtold Holding, AG (Berchtold), a privately-held business with operations in Germany and the United States, for an aggregate purchase price of approximately $184. Berchtold sells surgical tables, equipment booms and surgical lighting systems. In March 2014 we acquired Patient Safety Technologies, Inc. (PST), for an aggregate purchase price of approximately $120. PST conducts its business through its wholly owned subsidiary, SurgiCount Medical, Inc. PST’s proprietary Safety-Sponge® System and SurgiCount 360™ compliance software help prevent Retained Foreign Objects in the operating room. In addition to the acquisition of Pivot Medical Inc., which develops and sells innovative products for hip arthroscopy, our other acquisitions are included in Other. These acquisitions enhance our product offerings within our MedSurg segment. | |||||||||||||||
The purchase price allocations for the 2014 acquisitions were based upon preliminary valuations, and our estimates and assumptions are subject to change within the measurement period. Management is currently in the process of verifying data and finalizing information related to the 2014 acquisitions and the valuation and recording of identifiable intangible assets, deferred income taxes and the corresponding effect on the value of goodwill. | |||||||||||||||
2013 Acquisitions | |||||||||||||||
In December 2013 we acquired MAKO Surgical Corp. (MAKO) for an aggregate purchase price of approximately $1,677. The acquisition of MAKO, combined with our strong history in joint reconstruction, capital equipment (operating room integration and surgical navigation) and surgical instruments, will help further advance the growth of robotic assisted surgery. Our combined expertise offers the potential to simplify joint reconstruction procedures, reduce variability and enhance the surgeon and patient experience. The acquisition of MAKO enhances our product offerings within our Orthopaedics segment. Intangible assets acquired with MAKO will be amortized over a weighted-average life of 9 years. | |||||||||||||||
In March 2013 we acquired Trauson Holdings Company Limited (Trauson) for an aggregate purchase price of approximately $751. The acquisition of Trauson enhances our product offerings, primarily within our Orthopaedics segment, broadens our presence in China and enables us to expand into the fast growing value segment of the emerging markets. Intangible assets acquired with Trauson will be amortized over a weighted-average life of 15 years, except for the trade name that is deemed to have an indefinite life. | |||||||||||||||
For the MAKO and Trauson acquisitions, the measurement periods have been completed and revisions to our original estimates are included in the table below. | |||||||||||||||
The effects of all the acquisitions described above are included in our Consolidated Financial Statements prospectively from the date of acquisition. Pro forma consolidated results of operations for 2014 and 2013 would not differ significantly as a result of these acquisitions. | |||||||||||||||
The allocation of the purchase price to the acquired net assets of the acquisitions described above are as follows: | |||||||||||||||
2014 | |||||||||||||||
SBi | Berchtold | PST | Other | ||||||||||||
Purchase price paid | $ | 358 | $ | 184 | $ | 120 | $ | 216 | |||||||
Tangible assets acquired: | |||||||||||||||
Cash | — | 12 | — | — | |||||||||||
Inventory | 34 | 22 | 7 | 5 | |||||||||||
Other assets | 4 | 38 | 19 | 25 | |||||||||||
Liabilities | (2 | ) | (45 | ) | (33 | ) | (37 | ) | |||||||
Intangible assets: | |||||||||||||||
Customer relationship | 19 | 11 | 33 | 5 | |||||||||||
Trade name | — | 7 | — | — | |||||||||||
Developed technology & patents | 82 | 32 | 26 | 115 | |||||||||||
IPRD | — | — | — | 2 | |||||||||||
Goodwill | 221 | 107 | 68 | 101 | |||||||||||
$ | 358 | $ | 184 | $ | 120 | $ | 216 | ||||||||
Goodwill acquired associated with the SBi acquisition in 2014 is deductible for tax purposes. | |||||||||||||||
2013 | |||||||||||||||
MAKO | |||||||||||||||
Original | Revised | Change | Trauson | ||||||||||||
Purchase price paid | $ | 1,679 | $ | 1,677 | $ | (2 | ) | $ | 751 | ||||||
Tangible assets acquired: | |||||||||||||||
Cash | 56 | 56 | — | 98 | |||||||||||
Inventory | 50 | 41 | (9 | ) | 43 | ||||||||||
Other assets | 118 | 191 | 73 | 65 | |||||||||||
Liabilities | (277 | ) | (239 | ) | 38 | (87 | ) | ||||||||
Intangible assets: | |||||||||||||||
Customer relationship | 91 | 80 | (11 | ) | 112 | ||||||||||
Trade name | 24 | 4 | (20 | ) | 34 | ||||||||||
Developed technology & patents | 231 | 213 | (18 | ) | 31 | ||||||||||
IPRD | 169 | 171 | 2 | 5 | |||||||||||
Goodwill | 1,217 | 1,160 | (57 | ) | 450 | ||||||||||
$ | 1,679 | $ | 1,677 | $ | (2 | ) | $ | 751 | |||||||
Goodwill_and_Other_Intangibles
Goodwill and Other Intangibles | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Goodwill and Other Intangibles | GOODWILL AND OTHER INTANGIBLE ASSETS | |||||||||||||||
We completed our annual impairment tests of goodwill in 2014 and 2013 and concluded in each year that no impairments exist. The changes in the net carrying value of goodwill by segment are as follows: | ||||||||||||||||
Orthopedics | MedSurg | Neurotechnology and Spine | Total | |||||||||||||
31-Dec-12 | $ | 691 | $ | 513 | $ | 938 | $ | 2,142 | ||||||||
Goodwill acquired during the year | 1,559 | 2 | 108 | 1,669 | ||||||||||||
Foreign currency and other | (23 | ) | (9 | ) | 65 | 33 | ||||||||||
31-Dec-13 | $ | 2,227 | $ | 506 | $ | 1,111 | $ | 3,844 | ||||||||
Goodwill acquired during the year | 243 | 231 | 23 | 497 | ||||||||||||
Foreign currency and other | (84 | ) | (11 | ) | (60 | ) | (155 | ) | ||||||||
31-Dec-14 | $ | 2,386 | $ | 726 | $ | 1,074 | $ | 4,186 | ||||||||
Measurement period adjustments that reflect changes to goodwill for acquisitions completed in a previous year are included in "Foreign currency translation effects & other." | ||||||||||||||||
The following is a summary of our other intangible assets: | ||||||||||||||||
Weighted Average Amortization Period (Years) | Gross | Less | Net | |||||||||||||
Carrying | Accumulated | Carrying | ||||||||||||||
Amount | Amortization | Amount | ||||||||||||||
Developed technologies | ||||||||||||||||
2014 | 13 | $ | 1,468 | 466 | 1,002 | |||||||||||
2013 | 12 | 1,450 | 380 | 1,070 | ||||||||||||
Customer relationships | ||||||||||||||||
2014 | 15 | $ | 801 | 239 | 562 | |||||||||||
2013 | 17 | 677 | 189 | 488 | ||||||||||||
Patents | ||||||||||||||||
2014 | 12 | $ | 293 | 175 | 118 | |||||||||||
2013 | 13 | 238 | 190 | 48 | ||||||||||||
Trademarks | ||||||||||||||||
2014 | 14 | $ | 112 | 37 | 75 | |||||||||||
2013 | 14 | 127 | 34 | 93 | ||||||||||||
In-process research and development | ||||||||||||||||
2014 | $ | 201 | — | 201 | ||||||||||||
2013 | 223 | — | 223 | |||||||||||||
Other | ||||||||||||||||
2014 | 12 | $ | 111 | 51 | 60 | |||||||||||
2013 | 13 | 118 | 51 | 67 | ||||||||||||
Total | ||||||||||||||||
2014 | 13 | $ | 2,986 | 968 | 2,018 | |||||||||||
2013 | 13 | 2,833 | 844 | 1,989 | ||||||||||||
Amortization expense related to intangible assets was $188, $138 and $123 for 2014, 2013 and 2012, respectively. | ||||||||||||||||
The estimated amortization expense for each of the next five years is: | ||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | ||||||||||||
Estimated amortization expense | $ | 196 | $ | 166 | $ | 164 | $ | 148 | $ | 132 | ||||||
Contingencies_and_Commitments
Contingencies and Commitments | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||
Contingencies and Commitments | CONTINGENCIES AND COMMITMENTS | ||||||||||||||||||
We are involved in various ongoing proceedings, legal actions and claims arising in the normal course of business, including proceedings related to product, labor and intellectual property, and other matters that are more fully described below. The outcomes of these matters will generally not be known for prolonged periods of time. In certain of the legal proceedings, the claimants seek damages, as well as other compensatory and equitable relief, that could result in the payment of significant claims and settlements and/or the imposition of injunctions or other equitable relief. For legal matters for which management has sufficient information to reasonably estimate our future obligations, a liability representing management's best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within the range is not known. The estimates are based on consultation with legal counsel, previous settlement experience and settlement strategies. If actual outcomes are less favorable than those estimated by management, additional expense may be incurred, which could unfavorably affect future operating results. We are currently self-insured for product liability-related claims and expenses. The ultimate cost to us with respect to product liability claims could be materially different than the amount of the current estimates and accruals and could have a material adverse effect on our financial position, results of operations and cash flows. | |||||||||||||||||||
In June 2012 we voluntarily recalled our Rejuvenate and ABG II Modular-Neck hip stems and terminated global distribution of these hip products. Product liability lawsuits relating to this voluntary recall have been filed against us. On November 3, 2014 we announced that we had entered into a settlement agreement to compensate eligible United States patients who had revision surgery to replace their Rejuvenate and/or ABG II Modular-Neck hip stem prior to that date. We continue to offer support for recall-related care and reimburse patients who are not eligible to enroll in the settlement program for testing and treatment services, including any necessary revision surgeries. In addition, some lawsuits will remain and we will continue to defend against them. Based on the information that has been received, the actuarially determined range of probable loss to resolve this entire matter on a global basis is estimated to be approximately $1,534 ($1,713 before $179 of third-party insurance recoveries) to $2,453. In 2014, we recorded charges to earnings, net of insurance recoveries, of $748 representing the excess of the minimum of the range over the previously recorded reserves. The final outcome of this matter is dependent on many factors that are difficult to predict including the number of enrollees in the settlement program and total awards to them, the number and costs of patients not eligible for the settlement program who seek testing and treatment services and require revision surgery and the number and actual costs to resolve the remaining lawsuits. Accordingly, the ultimate cost to resolve this entire matter globally may be materially different than the amount of the current estimate and accruals and could have a material adverse effect on our financial position, results of operations and cash flows. | |||||||||||||||||||
In 2010 we filed a lawsuit in federal court against Zimmer Holdings, Inc. (Zimmer), alleging that a Zimmer product infringed three of our patents. In 2013, following a jury trial favorable to us, the trial judge entered a final judgment that among other things, awarded us damages of $76 and ordered Zimmer to pay us enhanced damages. Zimmer appealed this ruling. In December 2014 the Federal Circuit affirmed the damages awarded to us, reversed the order for enhanced damages and remanded the issue of attorney fees to the trial court. We have filed for a petition for rehearing en banc on the issue of enhanced damages. Following the conclusion of the proceedings at the Federal Circuit, each party may seek Supreme Court review. We have not recorded a contingent gain related to this matter. | |||||||||||||||||||
In April 2011 Hill-Rom Company, Inc. and affiliated entities (Hill-Rom) brought a lawsuit against us alleging infringement under United States patent laws with respect to nine patents related to electrical network communications for hospital beds. The case has been stayed with respect to six of the patents, which are currently under reexamination by the United States Patent Office. With respect to the three remaining patents, Hill-Rom appealed the trial court's grant of summary judgment in our favor and the Federal Circuit reversed the trial court's decision and remanded the matter for additional proceedings. The ultimate resolution of this suit cannot be predicted and it is not possible at this time for us to estimate any probable loss or range of probable losses. However, the ultimate result could have a material adverse effect on our financial position, results of operations and cash flows. | |||||||||||||||||||
Purchase Commitments and Operating Leases | |||||||||||||||||||
We have purchase commitments for materials, supplies, services and property, plant and equipment as part of the normal course of business. In addition, we lease various manufacturing, warehousing and distribution facilities, administrative and sales offices as well as equipment under operating leases. Future commitments under these obligations and minimum lease commitments under these leases are: | |||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | ||||||||||||||
Purchase obligations | $ | 710 | $ | 134 | $ | 121 | $ | 67 | $ | 62 | $ | 56 | |||||||
Minimum lease payments | 60 | 45 | 33 | 25 | 19 | 34 | |||||||||||||
Rent expense totaled $103, $100, and $98 in 2014, 2013 and 2012, respectively. |
LongTerm_Debt_and_Credit_Facil
Long-Term Debt and Credit Facilities | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Long-term Debt, Unclassified [Abstract] | |||||||||||
Long-Term Debt And Credit Facilities | DEBT AND CREDIT FACILITIES | ||||||||||
In August 2014 we amended and restated our Senior Unsecured Revolving Credit Facility. The principal changes were to increase the aggregate principal amount of the commitments to $1,250, to extend the maturity date to August 22, 2019 and to revise the definition of the consolidated Earnings Before Interest Taxes Depreciation and Amortization (EBITDA). | |||||||||||
During 2014 we issued commercial paper under the commercial paper program. The program allows us to have a maximum of $1,250 in commercial paper outstanding, with maturities up to 397 days from the date of issuance. At December 31, 2014, outstanding commercial paper totaled $200, the weighted average original maturity of the commercial paper outstanding was approximately 62 days and the weighted average interest rate was 0.2%. | |||||||||||
In May 2014 we sold $600 in senior unsecured notes due 2024 (2024 Notes) and $400 of senior unsecured notes due 2044 (2044 Notes). The 2024 Notes will bear interest at 3.375% per year and, unless previously redeemed, will mature on May 15, 2024. The 2044 Notes will bear interest at 4.375% per year and, unless previously redeemed, will mature on May 15, 2044. | |||||||||||
Our debt is as follows: | December | December | |||||||||
2014 | 2013 | ||||||||||
Senior unsecured notes: | |||||||||||
Rate | Due | ||||||||||
3.00% | 1/15/15 | $ | 500 | $ | 500 | ||||||
2.00% | 9/30/16 | 750 | 749 | ||||||||
1.30% | 4/1/18 | 598 | 598 | ||||||||
4.38% | 1/15/20 | 498 | 498 | ||||||||
3.38% | 5/15/24 | 605 | — | ||||||||
4.10% | 4/1/43 | 395 | 394 | ||||||||
4.38% | 5/15/44 | 398 | — | ||||||||
Commercial paper | 200 | — | |||||||||
Other | 29 | 25 | |||||||||
Total debt | 3,973 | 2,764 | |||||||||
Less current maturities | (727 | ) | (25 | ) | |||||||
Total long-term debt | $ | 3,246 | $ | 2,739 | |||||||
Certain of our credit facilities require us to comply with financial and other covenants. We were in compliance with all covenants at December 31, 2014. We have lines of credit, issued by various financial institutions, available to fund our day-to-day operating needs. At December 31, 2014, we had $1,289 of borrowing capacity available under all of our existing credit facilities.The weighted average interest rate, excluding required fees, for all borrowings was 2.9% at December 31, 2014. | |||||||||||
At December 31, 2014, the total unamortized debt issuance costs incurred in connection with our outstanding notes were $21. The fair value of long-term debt (including current maturities and excluding the interest rate hedge) at December 31, 2014 and December 31, 2013 was $3,811 and $2,790, respectively. Substantially all of our long-term debt is classified within Level 1 of the fair value hierarchy because the fair value of the debt is estimated based on rates currently offered to us with identical terms and maturities, using quoted active market prices and yields, taking into account the underlying terms of the debt instruments. | |||||||||||
Interest expense, including required fees incurred on outstanding debt and credit facilities, which is included in other income (expense), totaled $113, $83, and $63 in 2014, 2013 and 2012, respectively. Cash interest paid on debt, including required fees, was $102, $88, and $55 in 2014, 2013 and 2012, respectively. |
Capital_Stock
Capital Stock | 12 Months Ended | ||||||||||||||
Dec. 31, 2014 | |||||||||||||||
Capital Stock [Abstract] | |||||||||||||||
Capital Stock | CAPITAL STOCK | ||||||||||||||
In December 2013 we declared a quarterly dividend of $0.305 per share, payable January 31, 2014 to shareholders of record at the close of business on December 31, 2013. In February 2014 we declared a quarterly dividend of $0.305 per share, payable April 30, 2014 to shareholders of record at the close of business on March 28, 2014. In April 2014 we declared a quarterly dividend of $0.305 per share, payable July 31, 2014 to shareholders of record at the close of business on June 28, 2014. In July 2014 we declared a quarterly dividend of $0.305 per share, payable October 31, 2014 to shareholders of record at the close of business on September 30, 2013. In December 2014 we declared a quarterly dividend of $0.345 per share, payable January 31, 2015 to shareholders of record at the close of business on December 31, 2014. | |||||||||||||||
In December of 2012 and 2011, we announced that our Board of Directors had authorized us to purchase up to $405 and $500, respectively, of our common stock (the 2012 and 2011 Repurchase Programs, respectively). The manner, timing and amount of purchases is determined by management based on an evaluation of market conditions, stock price and other factors and is subject to regulatory considerations. Purchases are to be made from time to time in the open market, in privately negotiated transactions or otherwise. | |||||||||||||||
During 2014 we repurchased 1.3 million shares at a cost of $100 under the 2011 Repurchase Program. We had made no repurchases pursuant to the 2012 Repurchase Program at December 31, 2014. Shares repurchased under the share repurchase programs are available for general corporate purposes, including offsetting dilution associated with stock option and other equity-based employee benefit plans. At December 31, 2014, the maximum dollar value of shares that may be purchased under the authorized Repurchase Programs was $583. | |||||||||||||||
Shares reserved for future compensation grants of Stryker common stock were 19 million and 23 million at December 31, 2014 and 2013. We have 0.5 million authorized shares of $1 par value preferred stock, none of which is outstanding. | |||||||||||||||
Stock Options | |||||||||||||||
We have long-term incentive plans from which we grant stock options to certain key employees and non-employee directors at an exercise price not less than the fair market value of the underlying common stock, which is the closing quoted price of our common stock on the day prior to the date of grant. The options are granted for periods of up to 10 years and become exercisable in varying installments. | |||||||||||||||
We measure the cost of employee stock options based on the grant-date fair value and recognize that cost using the straight-line method over the period during which a recipient is required to provide services in exchange for the options, typically the vesting period. The weighted-average fair value per share of options granted during 2014, 2013 and 2012, estimated on the date of grant using the Black-Scholes option pricing model, was $15.80, $15.24, and $13.36, respectively. The fair value of options granted was estimated using the following weighted-average assumptions: | |||||||||||||||
2014 | 2013 | 2012 | |||||||||||||
Risk-free interest rate | 2.1 | % | 1.3 | % | 1.3 | % | |||||||||
Expected dividend yield | 1.8 | % | 1.9 | % | 1.5 | % | |||||||||
Expected stock price volatility | 20.2 | % | 27.9 | % | 27.6 | % | |||||||||
Expected option life | 7.1 years | 7.1 years | 7.1 years | ||||||||||||
The risk-free interest rate for periods within the expected life of options granted is based on the United States Treasury yield curve in effect at the time of grant. Expected stock price volatility is based on the historical volatility of our stock. The expected option life, representing the period of time that options granted are expected to be outstanding, is based on historical option exercise and employee termination data. | |||||||||||||||
A summary of 2014 stock option activity is as follows: | |||||||||||||||
Shares (in millions) | Weighted | Weighted-Average | Aggregate | ||||||||||||
Average | Remaining | Intrinsic Value | |||||||||||||
Exercise Price | Term | ||||||||||||||
(in years) | |||||||||||||||
Outstanding January 1 | 17 | $ | 55.35 | ||||||||||||
Granted | 2.5 | 81.13 | |||||||||||||
Exercised | (3.7 | ) | 52.2 | ||||||||||||
Canceled | (0.6 | ) | 65.23 | ||||||||||||
Outstanding December 31 | 15.2 | $ | 59.97 | 5.6 | $ | 524.2 | |||||||||
Exercisable December 31 | 8.7 | $ | 54.34 | 3.8 | $ | 349.7 | |||||||||
Options expected to vest | 6 | $ | 67.17 | 8 | $ | 163.2 | |||||||||
The aggregate intrinsic value, which represents the cumulative difference between the fair market value of the underlying common stock and the option exercise prices, of options exercised during the years ended December 31, 2014, 2013 and 2012 was $113, $97, and $52, respectively. Exercise prices for options outstanding at December 31, 2014 ranged from $38.71 to $81.14. At December 31, 2014, there was $64 of unrecognized compensation cost related to nonvested stock options granted under the long-term incentive plans; that cost is expected to be recognized over the weighted-average period of 1.5 years. | |||||||||||||||
Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) | |||||||||||||||
We grant RSUs to key employees and non-employee directors and PSUs to certain key employees under our long-term incentive plans. The fair value of RSUs is determined based on the number of shares granted and the closing quoted price of our common stock on the day prior to the date of grant, adjusted for the fact that RSUs do not include anticipated dividends. RSUs generally vest in one-third increments over a three-year period and are settled in stock. PSUs are earned over a three-year performance cycle and vest in March of the year following the end of that performance cycle. The number of PSUs that will ultimately be earned is based on our performance relative to pre-established goals during that three-year performance cycle. | |||||||||||||||
The fair value of PSUs is determined based on the closing quoted price of our common stock on the day prior to the date of grant. A summary of 2014 RSU and PSU activity is as follows: | |||||||||||||||
Shares | Weighted | ||||||||||||||
(in millions) | Average | ||||||||||||||
Grant date | |||||||||||||||
Fair value | |||||||||||||||
RSUs | PSUs | RSUs | PSUs | ||||||||||||
Nonvested at January 1 | 1.5 | 0.3 | $ | 56.19 | $ | 58.1 | |||||||||
Granted | 0.6 | 0.1 | 76.61 | 81.14 | |||||||||||
Vested | (0.7 | ) | (0.1 | ) | 55.71 | 56.53 | |||||||||
Canceled | (0.1 | ) | — | 63.45 | 57.12 | ||||||||||
Nonvested at December 31 | 1.3 | 0.3 | $ | 65.04 | $ | 66.18 | |||||||||
At December 31, 2014 there was $45 of unrecognized compensation cost related to nonvested RSUs. That cost is expected to be recognized as expense over the weighted-average period of 0.9 years. The weighted-average grant date fair value per share of RSUs granted in 2014 and 2013 was $76.61 and $60.81, respectively. The fair value of RSUs vested in 2014 was $39. At December 31, 2014, there was $9 of unrecognized compensation cost related to nonvested PSUs; that cost is expected to be recognized as expense over the weighted-average period of one year. | |||||||||||||||
Employee Stock Purchase Plans (ESPP) | |||||||||||||||
Full- time and part-time employees may participate in our ESPP provided they meet certain eligibility requirements. The purchase price for our common stock under the terms of the ESPP is defined as 95% of the closing stock price on the last trading day of a purchase period. During 2014 and 2013, we issued 150,167 and 163,533 shares, respectively, under the ESPP. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Income Taxes | INCOME TAXES | ||||||||||||
Earnings before income taxes consisted of: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | $ | 355 | $ | 193 | $ | 591 | |||||||
International | 805 | 1,019 | 1,114 | ||||||||||
$ | 1,160 | $ | 1,212 | $ | 1,705 | ||||||||
Income taxes consisted of: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Current income tax expense | |||||||||||||
United States federal | $ | 213 | $ | 79 | $ | 227 | |||||||
United States state and local | 26 | 29 | 41 | ||||||||||
International | 346 | 75 | 178 | ||||||||||
Total current income tax expense | 585 | 183 | 446 | ||||||||||
Deferred income tax expense (benefit) | |||||||||||||
United States federal | 9 | (52 | ) | (12 | ) | ||||||||
United States state and local | (16 | ) | (4 | ) | (9 | ) | |||||||
International | 67 | 79 | (18 | ) | |||||||||
Total deferred income tax expense (benefit) | 60 | 23 | (39 | ) | |||||||||
Total income tax expense | $ | 645 | $ | 206 | $ | 407 | |||||||
Interest expense and penalties included in other income (expense) | $ | 8 | $ | 12 | $ | (4 | ) | ||||||
In 2014 we recorded the income tax impacts of the establishment of a European regional headquarters and a cash repatriation to the United States planned for 2015. In 2013 we recorded income tax benefits related to favorable audit resolutions in multiple jurisdictions. In 2014, 2013 and 2012, the United States federal deferred income tax expense (benefit) includes the utilization of net operating loss carryforwards of $78, $16 and $16, respectively. | |||||||||||||
Reconciliation of the United States federal statutory income tax rate to our effective income tax rate: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States federal statutory rate | 35 | % | 35 | % | 35 | % | |||||||
Add (deduct): | |||||||||||||
United States state and local income taxes, less federal deduction | 2.2 | 1.4 | 1.7 | ||||||||||
Foreign income tax at rates other than 35% | 4.9 | (13.7 | ) | (12.1 | ) | ||||||||
Tax related to repatriation of foreign earnings | 10.1 | — | (0.4 | ) | |||||||||
Other | 3.4 | (5.7 | ) | (0.3 | ) | ||||||||
55.6 | % | 17 | % | 23.9 | % | ||||||||
Deferred income tax assets and liabilities: | |||||||||||||
December | |||||||||||||
2014 | 2013 | ||||||||||||
Deferred income tax assets: | |||||||||||||
Inventories | $ | 585 | $ | 607 | |||||||||
Product related liabilities | 167 | 67 | |||||||||||
Other accrued expenses | 226 | 221 | |||||||||||
Depreciation and amortization | 44 | 46 | |||||||||||
State income taxes | 68 | 53 | |||||||||||
Share-based compensation | 90 | 101 | |||||||||||
Net operating loss carryforwards | 123 | 124 | |||||||||||
Other | 143 | 107 | |||||||||||
Total deferred income tax assets | 1,446 | 1,326 | |||||||||||
Less valuation allowances | (42 | ) | (39 | ) | |||||||||
Total deferred income tax assets after valuation allowances | 1,404 | 1,287 | |||||||||||
Deferred income tax liabilities: | |||||||||||||
Depreciation and amortization | (666 | ) | (668 | ) | |||||||||
Undistributed earnings | (132 | ) | (16 | ) | |||||||||
Other | (54 | ) | (86 | ) | |||||||||
Total deferred income tax liabilities | (852 | ) | (770 | ) | |||||||||
Net deferred income tax assets | $ | 552 | $ | 517 | |||||||||
Reported as: | |||||||||||||
Current assets—Deferred income taxes | $ | 989 | $ | 880 | |||||||||
Noncurrent assets—Other | 39 | 34 | |||||||||||
Current liabilities—Accrued expenses and other liabilities | (3 | ) | — | ||||||||||
Noncurrent liabilities—Other liabilities | (473 | ) | (397 | ) | |||||||||
$ | 552 | $ | 517 | ||||||||||
Accrued interest and penalties reported as accrued expenses and other liabilities | $ | 26 | $ | 34 | |||||||||
Net operating loss carryforwards totaling $376 at December 31, 2014 are available to reduce future taxable earnings of certain domestic and foreign subsidiaries. United States loss carryforwards of $288 expire between 2014 and 2033. International loss carryforwards of $88 expire beginning in 2014; however, some have no expiration. Of these carryforwards, $43 are subject to a full valuation allowance. We also have a tax credit carryforward of $31 with a full valuation allowance. These credits have no expiration; however, we do not anticipate generating income tax in excess of the credits in the foreseeable future. | |||||||||||||
No provision has been made for United States federal and state income taxes or international income taxes that may result from future remittances of the undistributed earnings of foreign subsidiaries that are determined to be indefinitely reinvested ($5,878 at December 31, 2014). Determination of the amount of any unrecognized deferred income tax liability on these is not practicable. | |||||||||||||
The changes in the amounts recorded for uncertain income tax positions are: | |||||||||||||
December | |||||||||||||
2014 | 2013 | ||||||||||||
Balance at beginning of year | $ | 204 | $ | 227 | |||||||||
Increases related to current year income tax positions | 133 | 22 | |||||||||||
Increases related to prior year income tax positions | 23 | 56 | |||||||||||
Decreases related to prior year income tax positions: | |||||||||||||
Settlements and resolutions of income tax audits | (33 | ) | (37 | ) | |||||||||
Statute of limitations expirations | (1 | ) | (64 | ) | |||||||||
Foreign currency translation | (6 | ) | — | ||||||||||
Other | (5 | ) | — | ||||||||||
Balance at end of year | $ | 315 | $ | 204 | |||||||||
Reported as: | |||||||||||||
Current liabilities—Income taxes | $ | 3 | $ | 10 | |||||||||
Noncurrent liabilities—Other liabilities | 312 | 194 | |||||||||||
$ | 315 | $ | 204 | ||||||||||
Our income tax expense could have been reduced by $307 and $194 at December 31, 2014 and 2013, respectively, had these uncertain income tax positions been favorably resolved. It is reasonably possible that the amount of unrecognized tax benefits will significantly change due to one or more of the following events in the next twelve months: expiring statutes, audit activity, tax payments, competent authority proceedings related to transfer pricing or final decisions in matters that are the subject of controversy in various taxing jurisdictions in which we operate, including inventory transfer pricing and cost sharing, product royalty and foreign branch arrangements. We are not able to reasonably estimate the amount or the future periods in which changes in unrecognized tax benefits may be resolved; however, we do not anticipate any significant changes within the next twelve months. Interest and penalties incurred associated with uncertain tax positions are included in other income (expense). | |||||||||||||
In the normal course of business, income tax authorities in various income tax jurisdictions both within the United States and internationally conduct routine audits of our income tax returns filed in prior years. These audits are generally designed to determine if individual income tax authorities are in agreement with our interpretations of complex income tax regulations regarding the allocation of income to the various income tax jurisdictions. Income tax years are open from 2010 through the current year for the United States federal jurisdiction; income tax years open for our other major jurisdictions range from 2005 through the current year. |
Retirement_Plans
Retirement Plans | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |||||||||||||||||||||||||
Retirement Plans | RETIREMENT PLANS | ||||||||||||||||||||||||
Defined Contribution Plans | |||||||||||||||||||||||||
We provide certain employees with defined contribution plans. A portion of our retirement plan expense under the defined contribution plans is funded with Stryker common stock. The use of Stryker common stock represents a non-cash operating activity that is not reflected in the consolidated statements of cash flows. | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Plan expense | $ | 132 | $ | 132 | $ | 112 | |||||||||||||||||||
Expense funded with Stryker common stock | 18 | 16 | 15 | ||||||||||||||||||||||
Stryker common stock held by plan | |||||||||||||||||||||||||
Dollar amount | 198 | 150 | 104 | ||||||||||||||||||||||
Shares (in millions of shares) | 2.1 | 2 | 1.9 | ||||||||||||||||||||||
Value as a percentage of total plan assets | 11 | % | 9 | % | 9 | % | |||||||||||||||||||
Defined Benefit Plans | |||||||||||||||||||||||||
Certain of our subsidiaries have both funded and unfunded defined benefit pension plans covering some or all of their employees. Substantially all of the defined benefit pension plans have projected benefit obligations in excess of plan assets. | |||||||||||||||||||||||||
Obligations and Funded Status | December | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Funded status | |||||||||||||||||||||||||
Fair value of plan assets | $ | 310 | $ | 281 | |||||||||||||||||||||
Benefit obligations | 570 | 456 | |||||||||||||||||||||||
Funded status | $ | (260 | ) | $ | (175 | ) | |||||||||||||||||||
Reported as: | |||||||||||||||||||||||||
Current liabilities—accrued compensation | (1 | ) | (1 | ) | |||||||||||||||||||||
Noncurrent liabilities—other liabilities | (259 | ) | (174 | ) | |||||||||||||||||||||
Pre-tax amounts recognized in AOCI | |||||||||||||||||||||||||
Unrecognized net actuarial loss | $ | (195 | ) | $ | (115 | ) | |||||||||||||||||||
Unrecognized prior service cost | 15 | 12 | |||||||||||||||||||||||
$ | (180 | ) | $ | (103 | ) | ||||||||||||||||||||
The estimated net actuarial loss for the defined benefit pension plans to be reclassified from AOCI into net periodic benefit cost in 2015 is $9. We estimate that an immaterial amount of amortization of prior service cost and transition amount for the defined benefit pension plans will be reclassified from AOCI into net periodic benefit cost in 2014. | |||||||||||||||||||||||||
Pension plans with an accumulated benefit obligation in excess of plan assets had projected benefit obligations, accumulated benefit obligations and fair value of plan assets of $570, $533, and $310, respectively, at December 31, 2014 and $456, $427, and $281, respectively, at December 31, 2013. | |||||||||||||||||||||||||
Change in Benefit Obligations: | December | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Beginning Projected benefit obligations | $ | 456 | $ | 447 | |||||||||||||||||||||
Service cost | 26 | 30 | |||||||||||||||||||||||
Interest cost | 13 | 13 | |||||||||||||||||||||||
Foreign exchange impact | (43 | ) | 2 | ||||||||||||||||||||||
Employee contributions | 6 | 6 | |||||||||||||||||||||||
Actuarial (gains) losses | 134 | (29 | ) | ||||||||||||||||||||||
Plan amendments | (5 | ) | (1 | ) | |||||||||||||||||||||
Acquisitions | 5 | — | |||||||||||||||||||||||
Benefits paid | (22 | ) | (12 | ) | |||||||||||||||||||||
Ending Projected benefit obligations | $ | 570 | $ | 456 | |||||||||||||||||||||
Ending Accumulated benefit obligations | $ | 533 | $ | 427 | |||||||||||||||||||||
Change in Plan Assets: | December | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Beginning Fair value of plan assets | 281 | 254 | |||||||||||||||||||||||
Actual return | 46 | 11 | |||||||||||||||||||||||
Employer contributions | 18 | 20 | |||||||||||||||||||||||
Employee contributions | 6 | 6 | |||||||||||||||||||||||
Foreign exchange impact | (24 | ) | 1 | ||||||||||||||||||||||
Acquisition | 3 | — | |||||||||||||||||||||||
Benefits paid | (20 | ) | (11 | ) | |||||||||||||||||||||
Ending Fair value of plan assets | $ | 310 | $ | 281 | |||||||||||||||||||||
Components of Net Periodic Pension Cost | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Net periodic benefit cost: | |||||||||||||||||||||||||
Service cost | $ | (26 | ) | $ | (30 | ) | $ | (21 | ) | ||||||||||||||||
Interest cost | (13 | ) | (13 | ) | (13 | ) | |||||||||||||||||||
Expected return on plan assets | 10 | 10 | 9 | ||||||||||||||||||||||
Amortization of prior service cost and transition amount | 1 | 1 | 1 | ||||||||||||||||||||||
Recognized actuarial loss | (7 | ) | (8 | ) | (5 | ) | |||||||||||||||||||
Net periodic benefit cost | (35 | ) | (40 | ) | (29 | ) | |||||||||||||||||||
Changes in assets and benefit obligations recognized in OCI: | |||||||||||||||||||||||||
Net actuarial gain (loss) | (88 | ) | 28 | (87 | ) | ||||||||||||||||||||
Recognized net actuarial loss | 7 | 8 | 5 | ||||||||||||||||||||||
Prior service cost and transition amount | 4 | (1 | ) | — | |||||||||||||||||||||
Total recognized in OCI | (77 | ) | 35 | (82 | ) | ||||||||||||||||||||
Total recognized in net periodic benefit cost and OCI | $ | (112 | ) | $ | (5 | ) | $ | (111 | ) | ||||||||||||||||
Assumptions | |||||||||||||||||||||||||
Weighted-average rates used to determine net periodic benefit cost: | |||||||||||||||||||||||||
Discount rate | 3.2 | % | 2.9 | % | 4.2 | % | |||||||||||||||||||
Expected return on plan assets | 3.7 | % | 3.7 | % | 4.2 | % | |||||||||||||||||||
Rate of compensation increase | 2.9 | % | 3 | % | 3 | % | |||||||||||||||||||
Weighted-average discount rate used to determine projected benefit obligations | 2 | % | 3.2 | % | 2.9 | % | |||||||||||||||||||
Discount rate | |||||||||||||||||||||||||
The discount rates were selected using a hypothetical portfolio of high quality bonds at December 31 that would provide the necessary cash flows to match our projected benefit payments. | |||||||||||||||||||||||||
Expected return on plan assets | |||||||||||||||||||||||||
The expected return on plan assets is determined by applying the target allocation in each asset category of plan investments to the anticipated return for each asset category based on historical and projected returns. | |||||||||||||||||||||||||
Investment strategy | |||||||||||||||||||||||||
The investment strategy for our defined benefit pension plans is to meet the liabilities of the plans as they fall due and to maximize the return on invested assets within appropriate risk tolerances. The weighted-average target and actual allocation of plan assets by asset category is as follows: | |||||||||||||||||||||||||
Target | December | ||||||||||||||||||||||||
2014 | 2014 | 2013 | |||||||||||||||||||||||
Equity securities | 30 | % | 30 | % | 34 | % | |||||||||||||||||||
Debt securities | 50 | 48 | 46 | ||||||||||||||||||||||
Other | 20 | 22 | 20 | ||||||||||||||||||||||
100 | % | 100 | % | 100 | % | ||||||||||||||||||||
Valuation of Our Pension Plan Assets by Pricing Categories: | |||||||||||||||||||||||||
Level | |||||||||||||||||||||||||
2014 | 1 | 2 | 3 | Total | |||||||||||||||||||||
Cash and cash equivalents | $ | 6 | $ | — | $ | — | $ | 6 | |||||||||||||||||
Equity securities | 125 | — | — | 125 | |||||||||||||||||||||
Corporate debt securities | 121 | — | — | 121 | |||||||||||||||||||||
Other | 17 | 8 | 33 | 58 | |||||||||||||||||||||
Total | $ | 269 | $ | 8 | $ | 33 | $ | 310 | |||||||||||||||||
2013 | |||||||||||||||||||||||||
Cash and cash equivalents | $ | 10 | $ | — | $ | — | $ | 10 | |||||||||||||||||
Equity securities | 94 | — | — | 94 | |||||||||||||||||||||
Corporate debt securities | 127 | 2 | — | 129 | |||||||||||||||||||||
Other | 18 | 8 | 22 | 48 | |||||||||||||||||||||
Total | $ | 249 | $ | 10 | $ | 22 | $ | 281 | |||||||||||||||||
Our Level 3 pension plan assets (See Note 3 for an explanation of our fair value hierarchy) consist primarily of guaranteed investment contracts with insurance companies. The insurance contracts guarantee us principal repayment and a fixed rate of return. Our valuation of Level 3 assets is based on third-party actuarial valuations that are an estimation of the surrender value of the guaranteed investment contract between us and the insurance company. The surrender value equals the actuarial value of the notional investments underlying the guaranteed investment contract, using the actuarial assumptions as stated in the guaranteed investment contract. | |||||||||||||||||||||||||
Rollforward of Level 3 Pension Plan Assets | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Balance at January 1 | $ | 22 | $ | 23 | |||||||||||||||||||||
Actual return on plan assets held at the reporting date | 11 | — | |||||||||||||||||||||||
Purchases, sales, and settlements | — | (1 | ) | ||||||||||||||||||||||
Balance at December 31 | $ | 33 | $ | 22 | |||||||||||||||||||||
We expect to contribute $19 to our defined benefit pension plans in 2015. The estimated future benefit payments by year based on expected future service as appropriate are: | |||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | 2020-24 | ||||||||||||||||||||
Expected benefit payments | $ | 15 | $ | 15 | $ | 15 | $ | 15 | $ | 15 | $ | 81 | |||||||||||||
Segment_and_Geographic_Data
Segment and Geographic Data | 12 Months Ended | |||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||
Segment and Geographic Data | SEGMENT AND GEOGRAPHIC DATA | |||||||||||||||||
In 2014 we changed the name of our Reconstructive business segment to Orthopaedics. The name change did not change the composition of any of our business segments and had no financial impact. | ||||||||||||||||||
We segregate our operations into three reportable business segments: Orthopaedics, MedSurg, and Neurotechnology and Spine. The Orthopaedics segment includes reconstructive (hip and knee) and trauma implant systems as well as other related products. The MedSurg segment includes surgical equipment and surgical navigation systems (Instruments); endoscopic and communications systems (Endoscopy); patient handling and emergency medical equipment (Medical); and reprocessed and remanufactured medical devices (Sustainability) as well as other products. | ||||||||||||||||||
The Neurotechnology and Spine segment includes neurovascular products, spinal implant systems and other related products. The Other category shown in the table below includes corporate and global operations administration, central research and development initiatives, interest expense, interest and marketable securities income and share-based compensation, which includes compensation related to both employee and director stock option, restricted stock unit and performance stock unit grants. Certain prior year amounts have been reclassified to conform with the current year presentation of our segments. | ||||||||||||||||||
Results for our reportable segments were: | ||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Orthopaedics | 4,153 | 3,949 | 3,823 | |||||||||||||||
MedSurg | 3,781 | 3,414 | 3,265 | |||||||||||||||
Neurotechnology & Spine | 1,741 | 1,658 | 1,569 | |||||||||||||||
Net sales | $ | 9,675 | $ | 9,021 | $ | 8,657 | ||||||||||||
Orthopaedics | 319 | 273 | 271 | |||||||||||||||
MedSurg | 113 | 84 | 85 | |||||||||||||||
Neurotechnology & Spine | 134 | 135 | 122 | |||||||||||||||
Other | 19 | 19 | 8 | |||||||||||||||
Depreciation and amortization | $ | 585 | $ | 511 | $ | 486 | ||||||||||||
Orthopaedics | 367 | 365 | 344 | |||||||||||||||
MedSurg | 162 | 167 | 177 | |||||||||||||||
Neurotechnology & Spine | 107 | 98 | 76 | |||||||||||||||
Other | (118 | ) | (127 | ) | (75 | ) | ||||||||||||
Income taxes (credit) | $ | 518 | $ | 503 | $ | 522 | ||||||||||||
Orthopaedics | 1,033 | 988 | 971 | |||||||||||||||
MedSurg | 677 | 638 | 631 | |||||||||||||||
Neurotechnology & Spine | 364 | 333 | 326 | |||||||||||||||
Other | (264 | ) | (245 | ) | (280 | ) | ||||||||||||
Segment net earnings (loss) | $ | 1,810 | $ | 1,714 | $ | 1,648 | ||||||||||||
Less: | ||||||||||||||||||
Acquisition & integration-related charges | (65 | ) | (72 | ) | (37 | ) | ||||||||||||
Amortization of intangible assets | (133 | ) | (98 | ) | (88 | ) | ||||||||||||
Restructuring related charges | (78 | ) | (46 | ) | (59 | ) | ||||||||||||
Rejuvenate and related charges | (628 | ) | (460 | ) | (133 | ) | ||||||||||||
Regulatory and legal matters | — | (63 | ) | (33 | ) | |||||||||||||
Donation | — | (15 | ) | — | ||||||||||||||
Income tax related adjustments | (391 | ) | 46 | — | ||||||||||||||
Net earnings | $ | 515 | $ | 1,006 | $ | 1,298 | ||||||||||||
Total assets and capital spending by reportable segments were: | ||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Orthopaedics | 8,600 | 6,675 | 3,654 | |||||||||||||||
MedSurg | 5,626 | 3,382 | 2,996 | |||||||||||||||
Neurotechnology & Spine | 3,772 | 3,147 | 2,600 | |||||||||||||||
Other | (285 | ) | 2,539 | 3,956 | ||||||||||||||
Total assets | $ | 17,713 | $ | 15,743 | $ | 13,206 | ||||||||||||
Orthopaedics | 80 | 89 | 87 | |||||||||||||||
MedSurg | 77 | 59 | 51 | |||||||||||||||
Neurotechnology & Spine | 20 | 16 | 53 | |||||||||||||||
Other | 56 | 31 | 19 | |||||||||||||||
Capital spending | $ | 233 | $ | 195 | $ | 210 | ||||||||||||
Our reportable segments are business units that offer different products and services and are managed separately because each business requires different manufacturing, technology and marketing strategies. The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 1 to the Consolidated Financial Statements. | ||||||||||||||||||
We measure the financial results of our reportable segments using an internal performance measure that excludes acquisition and integration-related charges, restructuring related charges, reserves for certain product recall matters, reserves for certain legal and regulatory matters, a donation to an educational institution, and certain income tax adjustments. Identifiable assets are those assets used exclusively in the operations of each business segment or allocated when used jointly. Corporate assets are principally cash and cash equivalents, marketable securities and property, plant and equipment. | ||||||||||||||||||
The countries in which we have local revenue generating operations have been combined into the following geographic areas: the United States (including Puerto Rico); Europe, Middle East, Africa (EMEA); Asia Pacific; and other foreign countries, which include Canada and countries in the Latin American region. Sales are attributable to a geographic area based upon the customer’s country of domicile. | ||||||||||||||||||
Net property, plant and equipment are based upon physical location of the assets. Geographic information follows: | ||||||||||||||||||
Net Sales | Net Property, Plant & Equipment | |||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | ||||||||||||||
United States | $ | 6,558 | $ | 5,984 | $ | 5,658 | $ | 539 | $ | 506 | ||||||||
Europe, Middle East, Africa | 1,371 | 1,316 | 1,266 | 417 | 446 | |||||||||||||
Asia Pacific | 1,368 | 1,319 | 1,336 | 119 | 122 | |||||||||||||
Other foreign countries | 378 | 402 | 397 | 23 | 7 | |||||||||||||
$ | 9,675 | $ | 9,021 | $ | 8,657 | $ | 1,098 | $ | 1,081 | |||||||||
Summary_of_Quarterly_Data
Summary of Quarterly Data | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||
Summary of Quarterly Data | SUMMARY OF QUARTERLY DATA (UNAUDITED) | ||||||||||||||||
2014 Quarter Ended | |||||||||||||||||
31-Mar | Jun 30 | 30-Sep | 31-Dec | ||||||||||||||
Net sales | $ | 2,305 | $ | 2,363 | $ | 2,389 | $ | 2,618 | |||||||||
Gross profit | 1,536 | 1,555 | 1,567 | 1,726 | |||||||||||||
Earnings before income taxes | 107 | 167 | 425 | 461 | |||||||||||||
Net earnings | 70 | 128 | 57 | 260 | |||||||||||||
Net earnings per share of common stock: | |||||||||||||||||
Basic | 0.19 | 0.34 | 0.16 | 0.68 | |||||||||||||
Diluted | 0.18 | 0.33 | 0.16 | 0.67 | |||||||||||||
Market price of common stock: | |||||||||||||||||
High | 83.86 | 86.93 | 85.91 | 98.24 | |||||||||||||
Low | 74.02 | 75.78 | 78.91 | 77.87 | |||||||||||||
Dividends declared per share of common stock | $ | 0.305 | $ | 0.305 | $ | 0.305 | $ | 0.345 | |||||||||
2013 Quarter Ended | |||||||||||||||||
31-Mar | Jun 30 | 30-Sep | 31-Dec | ||||||||||||||
Net sales | $ | 2,190 | $ | 2,212 | $ | 2,151 | $ | 2,468 | |||||||||
Gross profit | 1,477 | 1,482 | 1,469 | 1,616 | |||||||||||||
Earnings before income taxes | 375 | 269 | 137 | 431 | |||||||||||||
Net earnings | 304 | 213 | 103 | 386 | |||||||||||||
Net earnings per share of common stock: | |||||||||||||||||
Basic | 0.8 | 0.56 | 0.27 | 1.02 | |||||||||||||
Diluted | 0.79 | 0.56 | 0.27 | 1.01 | |||||||||||||
Market price of common stock: | |||||||||||||||||
High | 66.92 | 70 | 71.94 | 75.55 | |||||||||||||
Low | 55.24 | 63.35 | 63.71 | 66.93 | |||||||||||||
Dividends declared per share of common stock | $ | 0.265 | $ | 0.265 | $ | 0.265 | $ | 0.305 | |||||||||
The price quotations reported above were supplied by the New York Stock Exchange. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Significant Accounting Policies [Abstract] | |
Nature of Operations | Stryker Corporation (the "Company," "we," "us," or "our") is one of the world's leading medical technology companies. Our products include implants used in joint replacement and trauma surgeries; surgical equipment and surgical navigation systems; endoscopic and communications systems; patient handling and emergency medical equipment; neurosurgical, neurovascular and spinal devices; as well as other medical device products used in a variety of medical specialties. |
Basis of Presentation and Consideration | The Consolidated Financial Statements include the Company and its subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. We have no material interests in variable interest entities and none that require consolidation. Certain prior year amounts have been reclassified to conform with the presentation of our consolidated statements of earnings in 2014. |
Use of Estimates | Preparation of financial statements in conformity with accounting principles generally accepted in the United States (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying disclosures. These estimates are based on management's best knowledge of current events and actions we may undertake in the future. Estimates are used in accounting for, among other items, pensions, stock options, valuation of acquired intangible assets, useful lives for depreciation and amortization of long-lived assets, future cash flows associated with impairment testing for goodwill, indefinite-lived intangible assets and other long-lived assets, excess and obsolete inventory, deferred tax assets and liabilities, uncertain income tax positions and contingencies. Actual results may ultimately differ from estimates. |
Revenue Recognition | Sales are recognized when revenue is realized or realizable and has been earned. Our policy is to recognize revenue when title to the product, ownership and risk of loss transfer to the customer, which can be on the date of shipment, the date of receipt by the customer or, for most orthopaedics products, when we receive appropriate notification that the product has been used or implanted. A provision for estimated sales returns, discounts, rebates and other sales incentives is recorded as a reduction of net sales in the same period that the revenue is recognized. Shipping and handling costs charged to customers are included in net sales. |
Cost of Sales | Cost of sales is primarily comprised of direct materials and supplies consumed in the manufacture of product, as well as manufacturing labor, depreciation expense and direct overhead expense necessary to acquire and convert the purchased materials and supplies into finished product. Cost of sales also includes the cost to distribute products to customers, inbound freight costs, warehousing costs and other shipping and handling activity. |
Research, Development and Engineering Expenses | Research and development costs are charged to expense as incurred. Costs include research, development and engineering activities relating to the development of new products, improvement of existing products, technical support of products and compliance with governmental regulations for the protection of customers and patients. Costs primarily consist of salaries, wages, consulting and depreciation and maintenance of research facilities and equipment. |
Selling, General and Administrative Expenses | Selling, general and administrative expense is primarily comprised of selling expenses, marketing expenses, administrative and other indirect overhead costs, amortization of loaner instrumentation, depreciation and amortization expense of non-manufacturing assets and other miscellaneous operating items. |
Currency Translation | Financial statements of subsidiaries outside the United States generally are measured using the local currency as the functional currency. Adjustments to translate those statements into United States dollars are recorded in other comprehensive income (OCI). Transactional exchange gains and losses are included in earnings. |
Cash Equivalents | Highly liquid investments with remaining stated maturities of three months or less when purchased are considered cash equivalents and recorded at cost. |
Marketable Securities | Marketable securities consist of marketable debt securities, certificates of deposit and mutual funds. Mutual funds are acquired to offset changes in certain liabilities related to deferred compensation arrangements and are expected to be used to settle these liabilities. Pursuant to our investment policy, all individual marketable security investments must have a minimum credit quality of single A (per Standard & Poor’s and Fitch) and A2 (per Moody’s Corporation) at the time of acquisition, while the overall portfolio of marketable securities must maintain a minimum average credit quality of double A (per Standard & Poor’s and Fitch) or Aa (per Moody’s Corporation). In the event of a rating downgrade below the minimum credit quality subsequent to purchase, the marketable security investment is evaluated to determine the appropriate action to take to minimize the overall risk to our marketable security investment portfolio. Our marketable securities are classified as available-for-sale and trading securities. |
Accounts Receivable | Accounts receivable consists of trade and other miscellaneous receivables. An allowance is maintained for doubtful accounts for estimated losses in the collection of accounts receivable. Estimates are made regarding the ability of customers to make required payments based on historical credit experience and expected future trends. Accounts receivable are written off when all reasonable collection efforts are exhausted. |
Inventories | Inventories are stated at the lower of cost or market, with cost generally determined using the first-in, first-out (FIFO) cost method. For excess and obsolete inventory resulting from the potential inability to sell specific products at prices in excess of current carrying costs, reserves are maintained to reduce current carrying cost to market prices. |
Financial Instruments | Our financial instruments consist of cash, cash equivalents, marketable securities, accounts receivable, other investments, accounts payable, debt and foreign currency exchange contracts. With the exception of our long-term debt, which is discussed in further detail in Note 8, our estimates of fair value for financial instruments approximate their carrying amounts as of December 31, 2014 and 2013. |
All marketable securities are recognized at fair value. Adjustments to the fair value of marketable securities that are classified as available-for-sale are recorded as increases or decreases, net of income taxes, within accumulated other comprehensive income (AOCI) in shareholders’ equity and adjustments to the fair value of marketable securities that are classified as trading are recorded in earnings. The amortized cost of marketable debt securities is adjusted for amortization of premiums and discounts to maturity computed under the effective interest method. Such amortization is included in other income (expense) along with interest and realized gains and losses. The cost of securities sold is determined by the specific identification method. | |
We review declines in the fair value of our investments classified as available-for-sale for impairment to determine whether the decline in fair value is an other-than-temporary impairment. The resulting losses from other-than-temporary impairments of available-for-sale marketable securities are included in earnings. | |
Derivatives | All derivatives are recognized at fair value and reported on a gross basis. We enter into forward currency exchange contracts to mitigate the impact of currency fluctuations on transactions denominated in nonfunctional currencies, thereby limiting our risk that would otherwise result from changes in exchange rates. These nonfunctional currency exposures principally relate to intercompany receivables and payables arising from intercompany purchases of manufactured products. The periods of the forward currency exchange contracts correspond to the periods of the exposed transactions, with realized gains and losses included in the measurement and recording of transactions denominated in the nonfunctional currencies. All forward currency exchange contracts are recorded at their fair value each period, with resulting gains (losses) included in earnings. |
Forward currency exchange contracts designated as cash flow hedges are designed to hedge the variability of cash flows associated with forecasted transactions denominated in a foreign currency that will take place in the future. Changes in value of derivatives designated as cash flow hedges are recorded in AOCI on the consolidated balance sheets until earnings are affected by the variability of the underlying cash flows. At that time, the applicable amount of gain or loss from the derivative instrument that is deferred in shareholders’ equity is reclassified into earnings and is included in other income (expense) or cost of goods sold in the consolidated statements of earnings, depending on the underlying transaction that is being hedged. We report our derivative instruments on a gross basis. | |
Interest rate derivative instruments designated as fair value hedges are being used to manage the exposure to interest rate movements and to reduce borrowing costs by converting fixed-rate debt into floating-rate debt. Under these agreements, we agree to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount. | |
Property, Plant and Equipment | Property, plant and equipment is stated at cost. Depreciation is generally computed by the straight-line method over the estimated useful lives of three to 30 years for buildings and improvements and three to ten years for machinery and equipment. |
Goodwill and Other Intangible Assets | Goodwill represents the excess of purchase price over fair value of tangible net assets of acquired businesses at the acquisition date, after amounts allocated to other identifiable intangible assets. Factors that contribute to the recognition of goodwill include securing synergies that are specific to our business and not available to other market participants and are expected to increase revenues and profits; acquisition of a talented workforce; cost savings opportunities; the strategic benefit of expanding our presence in core and adjacent markets; and diversifying our product portfolio. |
The fair values of other identifiable intangible assets are primarily determined using the income approach. Other intangible assets include, but are not limited to, developed technology, customer and distributor relationships (which reflect expected continued customer or distributor patronage) and trademarks and patents. Intangible assets with determinable useful lives are amortized on a straight-line basis over their estimated useful lives of four to 40 years. Certain acquired trade names are considered to have indefinite lives and are not amortized, but are assessed annually for potential impairment as described below. | |
In certain of our acquisitions, we acquire in-process research and development (IPRD) intangible assets. IPRD is considered to be an indefinite-lived intangible asset until such time as the research is completed (at which time it becomes a determinable-lived intangible asset) or determined to have no future use (at which time it is impaired). | |
Goodwill and Long-Lived Asset Impairment Tests | We perform our annual impairment test for goodwill in the fourth quarter of each year. We consider qualitative indicators of the fair value of a reporting unit when it is unlikely that a reporting unit has impaired goodwill. In certain circumstances, we may also utilize a discounted cash flow analysis that requires certain assumptions and estimates be made regarding market conditions and our future profitability. Indefinite-lived intangible assets are also tested at least annually for impairment by comparing the individual carrying values to the fair value. |
We review long-lived assets for indicators of impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The evaluation is performed at the lowest level of identifiable cash flows. Undiscounted cash flows expected to be generated by the related assets are estimated over the asset's useful life based on updated projections. If the evaluation indicates that the carrying amount of the asset may not be recoverable, any potential impairment is measured based upon the fair value of the related asset or asset group as determined by an appropriate market appraisal or other valuation technique. Assets classified as held for sale are recorded at the lower of carrying amount or fair value less costs to sell. | |
Share-Based Compensation | We utilize share based compensation in the form of stock options, restricted stock units (RSUs) and performance-based restricted stock units (PSUs). Compensation expense is recognized in the Consolidated Statements of Earnings based on the estimated fair value of the awards at grant date. Compensation expense recognized reflects an estimate of the number of awards expected to vest after taking into consideration an estimate of award forfeitures based on actual experience and is recognized on a straight-line basis over the requisite service period, which is generally the period required to obtain full vesting. Management expectations related to the achievement of performance goals associated with PSU grants is assessed regularly and that assessment is used to determine whether PSU grants are expected to vest. If performance-based milestones related to PSU grants are not met or not expected to be met, any compensation expense recognized to date associated with grants that are not expected to vest will be reversed. |
Income Taxes | Deferred income tax assets and liabilities are determined based on differences between financial reporting and income tax bases of assets and liabilities and are measured using the enacted income tax rates in effect for the years in which the differences are expected to reverse. Deferred income tax benefits generally represent the change in net deferred income tax assets and liabilities during the year. Other amounts result from adjustments related to acquisitions as appropriate. |
We operate in multiple income tax jurisdictions both within the United States and internationally. Accordingly, management must determine the appropriate allocation of income to each of these jurisdictions based on current interpretations of complex income tax regulations. Income tax authorities in these jurisdictions regularly perform audits of our income tax filings. Income tax audits associated with the allocation of this income and other complex issues, including inventory transfer pricing and cost sharing, product royalty and foreign branch arrangements, may require an extended period of time to resolve and may result in significant income tax adjustments if changes to the income allocation are required between jurisdictions with different income tax rates. | |
New Accounting Pronouncements Not Yet Adopted | In May 2014, the FASB issued Accounting Standard Update (ASU) No. 2014-09, Revenue from Contracts with Customers, which supersedes and replaces nearly all currently-existing United States GAAP revenue recognition guidance including related disclosure requirements. This guidance will be effective for us beginning January 1, 2017. We have not yet completed our assessment of the impact that adoption of this guidance will have on our financial statements. |
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Income (AOCI) Accumulated Other Comprehensive Income (AOCI) (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Reclassification Adjustments Out of Accumulated Other Comprehensive Income (AOCI) [Abstract] | ||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in and reclassifications out of AOCI, net of tax, for the years ended December 31, 2014 and 2013 were: | |||||||
2014 | 2013 | |||||||
Marketable Securities - Beginning | $ | — | $ | 4 | ||||
Other comprehensive income (OCI) | 12 | 16 | ||||||
Income tax expense on OCI | (2 | ) | 1 | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | — | — | ||||||
Other (income) expense | (9 | ) | (21 | ) | ||||
Income tax expense (benefit) | 2 | — | ||||||
Total other comprehensive income | 3 | (4 | ) | |||||
Marketable Securities - Ending | $ | 3 | $ | — | ||||
Pension Plans - Beginning | $ | (81 | ) | $ | (101 | ) | ||
Other comprehensive income (OCI) | (72 | ) | 30 | |||||
Income tax expense on OCI | 22 | (15 | ) | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | (6 | ) | 7 | |||||
Other (income) expense | — | — | ||||||
Income tax expense (benefit) | 1 | (2 | ) | |||||
Total other comprehensive income | (55 | ) | 20 | |||||
Pension Plans - Ending | $ | (136 | ) | $ | (81 | ) | ||
Hedges - Beginning | $ | 7 | $ | — | ||||
Other comprehensive income (OCI) | 10 | 8 | ||||||
Income tax expense on OCI | (4 | ) | 4 | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | (1 | ) | (9 | ) | ||||
Other (income) expense | — | — | ||||||
Income tax expense (benefit) | 1 | 4 | ||||||
Total other comprehensive income | 6 | 7 | ||||||
Hedges - Ending | $ | 13 | $ | 7 | ||||
Financial Statement Translation - Beginning | $ | 306 | $ | 226 | ||||
Other comprehensive income (OCI) | (440 | ) | 80 | |||||
Financial Statement Translation - Ending | $ | (134 | ) | $ | 306 | |||
AOCI - Beginning | $ | 232 | $ | 129 | ||||
Other comprehensive income (OCI) | (490 | ) | 134 | |||||
Income tax expense on OCI | 16 | (10 | ) | |||||
Reclassifications out of AOCI into: | ||||||||
Cost of sales | (7 | ) | (2 | ) | ||||
Other (income) expense | (9 | ) | (21 | ) | ||||
Income tax expense (benefit) | 4 | 2 | ||||||
Total other comprehensive income | (486 | ) | 103 | |||||
AOCI - Ending | $ | (254 | ) | $ | 232 | |||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Fair Value Disclosures [Abstract] | ||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | Our valuation of our assets and liabilities measured at fair value at December 31, 2014 and 2013 is: | |||||||
2014 | 2013 | |||||||
Cash and cash equivalents | $ | 1,795 | $ | 1,339 | ||||
Trading marketable securities | 80 | 72 | ||||||
Level 1 - Assets | 1,875 | 1,411 | ||||||
Available-for-sale marketable securities | ||||||||
Corporate and asset-backed debt securities | 1,525 | 1,177 | ||||||
Foreign government debt securities | 726 | 845 | ||||||
United States agency debt securities | 382 | 211 | ||||||
United States treasury debt securities | 474 | 350 | ||||||
Certificates of deposit | 110 | 53 | ||||||
Other | 12 | 5 | ||||||
Total available-for-sale marketable securities | 3,229 | 2,641 | ||||||
Foreign currency exchange forward contracts | 32 | 25 | ||||||
Interest rate swap asset | 10 | — | ||||||
Level 2 - Assets | 3,271 | 2,666 | ||||||
Total assets measured at fair value | $ | 5,146 | $ | 4,077 | ||||
Deferred compensation arrangements | $ | 80 | $ | 72 | ||||
Level 1 - Liabilities | 80 | 72 | ||||||
Foreign currency exchange forward contracts | 12 | 2 | ||||||
Level 2 - Liabilities | 12 | 2 | ||||||
Contingent consideration | ||||||||
Beginning Balance | 59 | 103 | ||||||
Losses (Gains) included in earnings | 4 | (5 | ) | |||||
Settlements | (15 | ) | (39 | ) | ||||
Ending Balance | 48 | 59 | ||||||
Level 3 - Liabilities | 48 | 59 | ||||||
Total liabilities measured at fair value | $ | 140 | $ | 133 | ||||
Available-for-sale Securities | The cost and estimated fair value of available-for-sale marketable securities at December 31, 2014 by contractual maturity are: | |||||||
2014 | ||||||||
Cost | Estimated Fair Value | |||||||
Due in one year or less | $ | 430 | $ | 430 | ||||
Due after one year through three years | 2,502 | 2,505 | ||||||
Due after three years | 294 | 294 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | ||||||||
Summary of marketable securities: | December | December | ||||||
2014 | 2013 | |||||||
Amortized Cost | ||||||||
Available-for-sale marketable securities: | ||||||||
Corporate and asset-backed debt securities | $ | 1,523 | $ | 1,177 | ||||
Foreign government debt securities | 725 | 846 | ||||||
United States agency debt securities | 382 | 211 | ||||||
United States treasury debt securities | 474 | 350 | ||||||
Certificates of deposit | 110 | 53 | ||||||
Other | 12 | 5 | ||||||
Gross Unrealized Gains | ||||||||
Corporate and asset-backed debt securities | $ | 3 | $ | 1 | ||||
Foreign government debt securities | 2 | — | ||||||
United States agency debt securities | — | — | ||||||
United States treasury debt securities | — | — | ||||||
Certificates of deposit | — | — | ||||||
Other | — | — | ||||||
Gross Unrealized Losses | ||||||||
Corporate and asset-backed debt securities | $ | (1 | ) | $ | (1 | ) | ||
Foreign government debt securities | (1 | ) | (1 | ) | ||||
United States agency debt securities | — | — | ||||||
United States treasury debt securities | — | — | ||||||
Certificates of deposit | — | — | ||||||
Other | — | — | ||||||
Estimated Fair Value | ||||||||
Corporate and asset-backed debt securities | $ | 1,525 | $ | 1,177 | ||||
Foreign government debt securities | 726 | 845 | ||||||
United States agency debt securities | 382 | 211 | ||||||
United States treasury debt securities | 474 | 350 | ||||||
Certificates of deposit | 110 | 53 | ||||||
Other | 12 | 5 | ||||||
Total available-for-sale marketable securities | $ | 3,229 | $ | 2,641 | ||||
Trading marketable securities | 80 | 72 | ||||||
Total marketable securities | $ | 3,309 | $ | 2,713 | ||||
Reported as: | ||||||||
Current assets-marketable securities | $ | 3,205 | $ | 2,641 | ||||
Current assets-prepaid expenses and other current assets | $ | 24 | $ | — | ||||
Noncurrent assets-other | $ | 80 | $ | 72 | ||||
Schedule of Loss Contingencies | The fair value and probability assessments of occurrence of triggering events for contingent consideration fair value measurements classified in Level 3 at December 31, 2014 were: | |||||||
Probability Range | ||||||||
Fair Value | Minimum | Maximum | Weighted Average | |||||
48 | 85 | 100 | 95 | |||||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | The gross unrealized losses and fair value of our investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at December 31, 2014, are as follows: | |||||||
Number of Investments | Fair Value | Unrealized Losses | ||||||
Less than 12 months | ||||||||
Corporate and Asset-Backed | 716 | $ | 1,515 | $ | (1 | ) | ||
Foreign Government | 142 | 711 | (1 | ) | ||||
United States Agency | 91 | 382 | — | |||||
Other | 164 | 596 | — | |||||
1,113 | $ | 3,204 | $ | (2 | ) | |||
Total | ||||||||
Corporate and Asset-Backed | 722 | $ | 1,525 | $ | (1 | ) | ||
Foreign Government | 147 | 726 | (1 | ) | ||||
United States Agency | 91 | 382 | — | |||||
Other | 164 | 596 | — | |||||
1,124 | $ | 3,229 | $ | (2 | ) | |||
Derivative_Instruments_Tables
Derivative Instruments (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The gross notional, maximum term and gross fair value amounts of foreign exchange forward contract derivatives designated and non-designated as hedging instruments are: | ||||||||||||
Designated | Non-Designated | Total | |||||||||||
December 31, 2014 | |||||||||||||
Gross Notional Amount | $ | 357 | $ | 2,085 | $ | 2,442 | |||||||
Maximum term in days | 546 | ||||||||||||
Fair Value | |||||||||||||
Other Current Assets | $ | 18 | $ | 12 | $ | 30 | |||||||
Other Noncurrent Assets | 2 | — | 2 | ||||||||||
Other Current Liabilities | — | 12 | 12 | ||||||||||
$ | 20 | $ | — | $ | 20 | ||||||||
December 31, 2013 | |||||||||||||
Gross Notional Amount | $ | 344 | $ | 2,000 | $ | 2,344 | |||||||
Maximum term in days | 546 | ||||||||||||
Fair Value | |||||||||||||
Other Current Assets | $ | 11 | $ | 10 | $ | 21 | |||||||
Other Noncurrent Assets | 1 | 3 | 4 | ||||||||||
Other Current Liabilities | 1 | 1 | 2 | ||||||||||
$ | 11 | $ | 12 | $ | 23 | ||||||||
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location | |||||||||||||
Recorded In: | 2014 | 2013 | 2012 | ||||||||||
Cost of goods sold | $ | 1 | $ | — | $ | — | |||||||
Other income (expense) | (8 | ) | 3 | (7 | ) | ||||||||
Total | $ | (7 | ) | $ | 3 | $ | (7 | ) | |||||
Acquisitions_Tables
Acquisitions (Tables) | 12 Months Ended | ||||||||||||||
Dec. 31, 2014 | |||||||||||||||
Business Combinations [Abstract] | |||||||||||||||
Allocation Of The Preliminary Purchase Price To The Acquired Net Assets Of Acquisitions | The allocation of the purchase price to the acquired net assets of the acquisitions described above are as follows: | ||||||||||||||
2014 | |||||||||||||||
SBi | Berchtold | PST | Other | ||||||||||||
Purchase price paid | $ | 358 | $ | 184 | $ | 120 | $ | 216 | |||||||
Tangible assets acquired: | |||||||||||||||
Cash | — | 12 | — | — | |||||||||||
Inventory | 34 | 22 | 7 | 5 | |||||||||||
Other assets | 4 | 38 | 19 | 25 | |||||||||||
Liabilities | (2 | ) | (45 | ) | (33 | ) | (37 | ) | |||||||
Intangible assets: | |||||||||||||||
Customer relationship | 19 | 11 | 33 | 5 | |||||||||||
Trade name | — | 7 | — | — | |||||||||||
Developed technology & patents | 82 | 32 | 26 | 115 | |||||||||||
IPRD | — | — | — | 2 | |||||||||||
Goodwill | 221 | 107 | 68 | 101 | |||||||||||
$ | 358 | $ | 184 | $ | 120 | $ | 216 | ||||||||
2013 | |||||||||||||||
MAKO | |||||||||||||||
Original | Revised | Change | Trauson | ||||||||||||
Purchase price paid | $ | 1,679 | $ | 1,677 | $ | (2 | ) | $ | 751 | ||||||
Tangible assets acquired: | |||||||||||||||
Cash | 56 | 56 | — | 98 | |||||||||||
Inventory | 50 | 41 | (9 | ) | 43 | ||||||||||
Other assets | 118 | 191 | 73 | 65 | |||||||||||
Liabilities | (277 | ) | (239 | ) | 38 | (87 | ) | ||||||||
Intangible assets: | |||||||||||||||
Customer relationship | 91 | 80 | (11 | ) | 112 | ||||||||||
Trade name | 24 | 4 | (20 | ) | 34 | ||||||||||
Developed technology & patents | 231 | 213 | (18 | ) | 31 | ||||||||||
IPRD | 169 | 171 | 2 | 5 | |||||||||||
Goodwill | 1,217 | 1,160 | (57 | ) | 450 | ||||||||||
$ | 1,679 | $ | 1,677 | $ | (2 | ) | $ | 751 | |||||||
Goodwill_and_Other_Intangibles1
Goodwill and Other Intangibles (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Changes in the Net Carrying Amount of Goodwill by Segment | The changes in the net carrying value of goodwill by segment are as follows: | |||||||||||||||
Orthopedics | MedSurg | Neurotechnology and Spine | Total | |||||||||||||
31-Dec-12 | $ | 691 | $ | 513 | $ | 938 | $ | 2,142 | ||||||||
Goodwill acquired during the year | 1,559 | 2 | 108 | 1,669 | ||||||||||||
Foreign currency and other | (23 | ) | (9 | ) | 65 | 33 | ||||||||||
31-Dec-13 | $ | 2,227 | $ | 506 | $ | 1,111 | $ | 3,844 | ||||||||
Goodwill acquired during the year | 243 | 231 | 23 | 497 | ||||||||||||
Foreign currency and other | (84 | ) | (11 | ) | (60 | ) | (155 | ) | ||||||||
31-Dec-14 | $ | 2,386 | $ | 726 | $ | 1,074 | $ | 4,186 | ||||||||
Summary of the Company's Other Intangible Assets | The following is a summary of our other intangible assets: | |||||||||||||||
Weighted Average Amortization Period (Years) | Gross | Less | Net | |||||||||||||
Carrying | Accumulated | Carrying | ||||||||||||||
Amount | Amortization | Amount | ||||||||||||||
Developed technologies | ||||||||||||||||
2014 | 13 | $ | 1,468 | 466 | 1,002 | |||||||||||
2013 | 12 | 1,450 | 380 | 1,070 | ||||||||||||
Customer relationships | ||||||||||||||||
2014 | 15 | $ | 801 | 239 | 562 | |||||||||||
2013 | 17 | 677 | 189 | 488 | ||||||||||||
Patents | ||||||||||||||||
2014 | 12 | $ | 293 | 175 | 118 | |||||||||||
2013 | 13 | 238 | 190 | 48 | ||||||||||||
Trademarks | ||||||||||||||||
2014 | 14 | $ | 112 | 37 | 75 | |||||||||||
2013 | 14 | 127 | 34 | 93 | ||||||||||||
In-process research and development | ||||||||||||||||
2014 | $ | 201 | — | 201 | ||||||||||||
2013 | 223 | — | 223 | |||||||||||||
Other | ||||||||||||||||
2014 | 12 | $ | 111 | 51 | 60 | |||||||||||
2013 | 13 | 118 | 51 | 67 | ||||||||||||
Total | ||||||||||||||||
2014 | 13 | $ | 2,986 | 968 | 2,018 | |||||||||||
2013 | 13 | 2,833 | 844 | 1,989 | ||||||||||||
Estimated Amortization Expense | The estimated amortization expense for each of the next five years is: | |||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | ||||||||||||
Estimated amortization expense | $ | 196 | $ | 166 | $ | 164 | $ | 148 | $ | 132 | ||||||
Contingencies_and_Commitments_
Contingencies and Commitments (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||
Future Purchase Obligations and Minimum Lease Payments | Future commitments under these obligations and minimum lease commitments under these leases are: | ||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | ||||||||||||||
Purchase obligations | $ | 710 | $ | 134 | $ | 121 | $ | 67 | $ | 62 | $ | 56 | |||||||
Minimum lease payments | 60 | 45 | 33 | 25 | 19 | 34 | |||||||||||||
LongTerm_Debt_and_Credit_Facil1
Long-Term Debt and Credit Facilities (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Long-term Debt, Unclassified [Abstract] | |||||||||||
Maturities Of Long-Term Debt Disclosures | |||||||||||
Our debt is as follows: | December | December | |||||||||
2014 | 2013 | ||||||||||
Senior unsecured notes: | |||||||||||
Rate | Due | ||||||||||
3.00% | 1/15/15 | $ | 500 | $ | 500 | ||||||
2.00% | 9/30/16 | 750 | 749 | ||||||||
1.30% | 4/1/18 | 598 | 598 | ||||||||
4.38% | 1/15/20 | 498 | 498 | ||||||||
3.38% | 5/15/24 | 605 | — | ||||||||
4.10% | 4/1/43 | 395 | 394 | ||||||||
4.38% | 5/15/44 | 398 | — | ||||||||
Commercial paper | 200 | — | |||||||||
Other | 29 | 25 | |||||||||
Total debt | 3,973 | 2,764 | |||||||||
Less current maturities | (727 | ) | (25 | ) | |||||||
Total long-term debt | $ | 3,246 | $ | 2,739 | |||||||
Capital_Stock_Tables
Capital Stock (Tables) | 12 Months Ended | ||||||||||||||
Dec. 31, 2014 | |||||||||||||||
Capital Stock [Abstract] | |||||||||||||||
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] | The fair value of options granted was estimated using the following weighted-average assumptions: | ||||||||||||||
2014 | 2013 | 2012 | |||||||||||||
Risk-free interest rate | 2.1 | % | 1.3 | % | 1.3 | % | |||||||||
Expected dividend yield | 1.8 | % | 1.9 | % | 1.5 | % | |||||||||
Expected stock price volatility | 20.2 | % | 27.9 | % | 27.6 | % | |||||||||
Expected option life | 7.1 years | 7.1 years | 7.1 years | ||||||||||||
Summary of Stock Option Activity | |||||||||||||||
Shares (in millions) | Weighted | Weighted-Average | Aggregate | ||||||||||||
Average | Remaining | Intrinsic Value | |||||||||||||
Exercise Price | Term | ||||||||||||||
(in years) | |||||||||||||||
Outstanding January 1 | 17 | $ | 55.35 | ||||||||||||
Granted | 2.5 | 81.13 | |||||||||||||
Exercised | (3.7 | ) | 52.2 | ||||||||||||
Canceled | (0.6 | ) | 65.23 | ||||||||||||
Outstanding December 31 | 15.2 | $ | 59.97 | 5.6 | $ | 524.2 | |||||||||
Exercisable December 31 | 8.7 | $ | 54.34 | 3.8 | $ | 349.7 | |||||||||
Options expected to vest | 6 | $ | 67.17 | 8 | $ | 163.2 | |||||||||
Summary of RSU and PSU Activity | |||||||||||||||
Shares | Weighted | ||||||||||||||
(in millions) | Average | ||||||||||||||
Grant date | |||||||||||||||
Fair value | |||||||||||||||
RSUs | PSUs | RSUs | PSUs | ||||||||||||
Nonvested at January 1 | 1.5 | 0.3 | $ | 56.19 | $ | 58.1 | |||||||||
Granted | 0.6 | 0.1 | 76.61 | 81.14 | |||||||||||
Vested | (0.7 | ) | (0.1 | ) | 55.71 | 56.53 | |||||||||
Canceled | (0.1 | ) | — | 63.45 | 57.12 | ||||||||||
Nonvested at December 31 | 1.3 | 0.3 | $ | 65.04 | $ | 66.18 | |||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Schedule of Earnings before Income Taxes | Earnings before income taxes consisted of: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | $ | 355 | $ | 193 | $ | 591 | |||||||
International | 805 | 1,019 | 1,114 | ||||||||||
$ | 1,160 | $ | 1,212 | $ | 1,705 | ||||||||
Schedule of Provision for Income Taxes | Income taxes consisted of: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Current income tax expense | |||||||||||||
United States federal | $ | 213 | $ | 79 | $ | 227 | |||||||
United States state and local | 26 | 29 | 41 | ||||||||||
International | 346 | 75 | 178 | ||||||||||
Total current income tax expense | 585 | 183 | 446 | ||||||||||
Deferred income tax expense (benefit) | |||||||||||||
United States federal | 9 | (52 | ) | (12 | ) | ||||||||
United States state and local | (16 | ) | (4 | ) | (9 | ) | |||||||
International | 67 | 79 | (18 | ) | |||||||||
Total deferred income tax expense (benefit) | 60 | 23 | (39 | ) | |||||||||
Total income tax expense | $ | 645 | $ | 206 | $ | 407 | |||||||
Interest expense and penalties included in other income (expense) | $ | 8 | $ | 12 | $ | (4 | ) | ||||||
Schedule of Reconciliation of U.S. Statutory Income Tax Rate to Company's Effective Income Tax Rate from Continuing Operations | Reconciliation of the United States federal statutory income tax rate to our effective income tax rate: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States federal statutory rate | 35 | % | 35 | % | 35 | % | |||||||
Add (deduct): | |||||||||||||
United States state and local income taxes, less federal deduction | 2.2 | 1.4 | 1.7 | ||||||||||
Foreign income tax at rates other than 35% | 4.9 | (13.7 | ) | (12.1 | ) | ||||||||
Tax related to repatriation of foreign earnings | 10.1 | — | (0.4 | ) | |||||||||
Other | 3.4 | (5.7 | ) | (0.3 | ) | ||||||||
55.6 | % | 17 | % | 23.9 | % | ||||||||
Schedule of Difference in Income Tax Effects Comprising Company's Deferred Income Tax Assets and Liabilities | Deferred income tax assets and liabilities: | ||||||||||||
December | |||||||||||||
2014 | 2013 | ||||||||||||
Deferred income tax assets: | |||||||||||||
Inventories | $ | 585 | $ | 607 | |||||||||
Product related liabilities | 167 | 67 | |||||||||||
Other accrued expenses | 226 | 221 | |||||||||||
Depreciation and amortization | 44 | 46 | |||||||||||
State income taxes | 68 | 53 | |||||||||||
Share-based compensation | 90 | 101 | |||||||||||
Net operating loss carryforwards | 123 | 124 | |||||||||||
Other | 143 | 107 | |||||||||||
Total deferred income tax assets | 1,446 | 1,326 | |||||||||||
Less valuation allowances | (42 | ) | (39 | ) | |||||||||
Total deferred income tax assets after valuation allowances | 1,404 | 1,287 | |||||||||||
Deferred income tax liabilities: | |||||||||||||
Depreciation and amortization | (666 | ) | (668 | ) | |||||||||
Undistributed earnings | (132 | ) | (16 | ) | |||||||||
Other | (54 | ) | (86 | ) | |||||||||
Total deferred income tax liabilities | (852 | ) | (770 | ) | |||||||||
Net deferred income tax assets | $ | 552 | $ | 517 | |||||||||
Reported as: | |||||||||||||
Current assets—Deferred income taxes | $ | 989 | $ | 880 | |||||||||
Noncurrent assets—Other | 39 | 34 | |||||||||||
Current liabilities—Accrued expenses and other liabilities | (3 | ) | — | ||||||||||
Noncurrent liabilities—Other liabilities | (473 | ) | (397 | ) | |||||||||
$ | 552 | $ | 517 | ||||||||||
Accrued interest and penalties reported as accrued expenses and other liabilities | $ | 26 | $ | 34 | |||||||||
Schedule of Unresolved Income Tax Positions | The changes in the amounts recorded for uncertain income tax positions are: | ||||||||||||
December | |||||||||||||
2014 | 2013 | ||||||||||||
Balance at beginning of year | $ | 204 | $ | 227 | |||||||||
Increases related to current year income tax positions | 133 | 22 | |||||||||||
Increases related to prior year income tax positions | 23 | 56 | |||||||||||
Decreases related to prior year income tax positions: | |||||||||||||
Settlements and resolutions of income tax audits | (33 | ) | (37 | ) | |||||||||
Statute of limitations expirations | (1 | ) | (64 | ) | |||||||||
Foreign currency translation | (6 | ) | — | ||||||||||
Other | (5 | ) | — | ||||||||||
Balance at end of year | $ | 315 | $ | 204 | |||||||||
Reported as: | |||||||||||||
Current liabilities—Income taxes | $ | 3 | $ | 10 | |||||||||
Noncurrent liabilities—Other liabilities | 312 | 194 | |||||||||||
$ | 315 | $ | 204 | ||||||||||
Retirement_Plans_Tables
Retirement Plans (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |||||||||||||||||||||||||
Schedule of Defined Contribution Retirement Plan | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Plan expense | $ | 132 | $ | 132 | $ | 112 | |||||||||||||||||||
Expense funded with Stryker common stock | 18 | 16 | 15 | ||||||||||||||||||||||
Stryker common stock held by plan | |||||||||||||||||||||||||
Dollar amount | 198 | 150 | 104 | ||||||||||||||||||||||
Shares (in millions of shares) | 2.1 | 2 | 1.9 | ||||||||||||||||||||||
Value as a percentage of total plan assets | 11 | % | 9 | % | 9 | % | |||||||||||||||||||
Schedule of Funded Status and Components of the Amounts Recognized in the Consolidated Balance Sheets and in Accumulated Other Comprehensive Gain (Loss), Before the Effect of Income Taxes | |||||||||||||||||||||||||
Obligations and Funded Status | December | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Funded status | |||||||||||||||||||||||||
Fair value of plan assets | $ | 310 | $ | 281 | |||||||||||||||||||||
Benefit obligations | 570 | 456 | |||||||||||||||||||||||
Funded status | $ | (260 | ) | $ | (175 | ) | |||||||||||||||||||
Reported as: | |||||||||||||||||||||||||
Current liabilities—accrued compensation | (1 | ) | (1 | ) | |||||||||||||||||||||
Noncurrent liabilities—other liabilities | (259 | ) | (174 | ) | |||||||||||||||||||||
Pre-tax amounts recognized in AOCI | |||||||||||||||||||||||||
Unrecognized net actuarial loss | $ | (195 | ) | $ | (115 | ) | |||||||||||||||||||
Unrecognized prior service cost | 15 | 12 | |||||||||||||||||||||||
$ | (180 | ) | $ | (103 | ) | ||||||||||||||||||||
Schedule of Company's Defined Benefit Pension Plans | |||||||||||||||||||||||||
Change in Benefit Obligations: | December | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Beginning Projected benefit obligations | $ | 456 | $ | 447 | |||||||||||||||||||||
Service cost | 26 | 30 | |||||||||||||||||||||||
Interest cost | 13 | 13 | |||||||||||||||||||||||
Foreign exchange impact | (43 | ) | 2 | ||||||||||||||||||||||
Employee contributions | 6 | 6 | |||||||||||||||||||||||
Actuarial (gains) losses | 134 | (29 | ) | ||||||||||||||||||||||
Plan amendments | (5 | ) | (1 | ) | |||||||||||||||||||||
Acquisitions | 5 | — | |||||||||||||||||||||||
Benefits paid | (22 | ) | (12 | ) | |||||||||||||||||||||
Ending Projected benefit obligations | $ | 570 | $ | 456 | |||||||||||||||||||||
Ending Accumulated benefit obligations | $ | 533 | $ | 427 | |||||||||||||||||||||
Change in Plan Assets: | December | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Beginning Fair value of plan assets | 281 | 254 | |||||||||||||||||||||||
Actual return | 46 | 11 | |||||||||||||||||||||||
Employer contributions | 18 | 20 | |||||||||||||||||||||||
Employee contributions | 6 | 6 | |||||||||||||||||||||||
Foreign exchange impact | (24 | ) | 1 | ||||||||||||||||||||||
Acquisition | 3 | — | |||||||||||||||||||||||
Benefits paid | (20 | ) | (11 | ) | |||||||||||||||||||||
Ending Fair value of plan assets | $ | 310 | $ | 281 | |||||||||||||||||||||
Schedule of Net Periodic Benefit Cost and Other Changes in Plan Assets and Benefit Obligations Recognized n Other Comprehensive Gain (Loss), Before the Effect of Income Taxes | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Net periodic benefit cost: | |||||||||||||||||||||||||
Service cost | $ | (26 | ) | $ | (30 | ) | $ | (21 | ) | ||||||||||||||||
Interest cost | (13 | ) | (13 | ) | (13 | ) | |||||||||||||||||||
Expected return on plan assets | 10 | 10 | 9 | ||||||||||||||||||||||
Amortization of prior service cost and transition amount | 1 | 1 | 1 | ||||||||||||||||||||||
Recognized actuarial loss | (7 | ) | (8 | ) | (5 | ) | |||||||||||||||||||
Net periodic benefit cost | (35 | ) | (40 | ) | (29 | ) | |||||||||||||||||||
Changes in assets and benefit obligations recognized in OCI: | |||||||||||||||||||||||||
Net actuarial gain (loss) | (88 | ) | 28 | (87 | ) | ||||||||||||||||||||
Recognized net actuarial loss | 7 | 8 | 5 | ||||||||||||||||||||||
Prior service cost and transition amount | 4 | (1 | ) | — | |||||||||||||||||||||
Total recognized in OCI | (77 | ) | 35 | (82 | ) | ||||||||||||||||||||
Total recognized in net periodic benefit cost and OCI | $ | (112 | ) | $ | (5 | ) | $ | (111 | ) | ||||||||||||||||
Assumptions | |||||||||||||||||||||||||
Weighted-average rates used to determine net periodic benefit cost: | |||||||||||||||||||||||||
Discount rate | 3.2 | % | 2.9 | % | 4.2 | % | |||||||||||||||||||
Expected return on plan assets | 3.7 | % | 3.7 | % | 4.2 | % | |||||||||||||||||||
Rate of compensation increase | 2.9 | % | 3 | % | 3 | % | |||||||||||||||||||
Weighted-average discount rate used to determine projected benefit obligations | 2 | % | 3.2 | % | 2.9 | % | |||||||||||||||||||
Schedule of Weighted-Average Allocation of Plan Assets by Asset Category and of Weighted-Average Target Investment Allocation Ranges fro the Plans | The weighted-average target and actual allocation of plan assets by asset category is as follows: | ||||||||||||||||||||||||
Target | December | ||||||||||||||||||||||||
2014 | 2014 | 2013 | |||||||||||||||||||||||
Equity securities | 30 | % | 30 | % | 34 | % | |||||||||||||||||||
Debt securities | 50 | 48 | 46 | ||||||||||||||||||||||
Other | 20 | 22 | 20 | ||||||||||||||||||||||
100 | % | 100 | % | 100 | % | ||||||||||||||||||||
Schedule of Valuation of the Company's Pension Plan Assets by Pricing Categories | Valuation of Our Pension Plan Assets by Pricing Categories: | ||||||||||||||||||||||||
Level | |||||||||||||||||||||||||
2014 | 1 | 2 | 3 | Total | |||||||||||||||||||||
Cash and cash equivalents | $ | 6 | $ | — | $ | — | $ | 6 | |||||||||||||||||
Equity securities | 125 | — | — | 125 | |||||||||||||||||||||
Corporate debt securities | 121 | — | — | 121 | |||||||||||||||||||||
Other | 17 | 8 | 33 | 58 | |||||||||||||||||||||
Total | $ | 269 | $ | 8 | $ | 33 | $ | 310 | |||||||||||||||||
2013 | |||||||||||||||||||||||||
Cash and cash equivalents | $ | 10 | $ | — | $ | — | $ | 10 | |||||||||||||||||
Equity securities | 94 | — | — | 94 | |||||||||||||||||||||
Corporate debt securities | 127 | 2 | — | 129 | |||||||||||||||||||||
Other | 18 | 8 | 22 | 48 | |||||||||||||||||||||
Total | $ | 249 | $ | 10 | $ | 22 | $ | 281 | |||||||||||||||||
Schedule of Rollforward of Pension Plan Assets Measured at Fair Value on a Recurring Basis Using Unobservable Inputs (Level 3) | Rollforward of Level 3 Pension Plan Assets | ||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Balance at January 1 | $ | 22 | $ | 23 | |||||||||||||||||||||
Actual return on plan assets held at the reporting date | 11 | — | |||||||||||||||||||||||
Purchases, sales, and settlements | — | (1 | ) | ||||||||||||||||||||||
Balance at December 31 | $ | 33 | $ | 22 | |||||||||||||||||||||
Estimated Future Benefit Payments, which Reflect Expected Future Service | The estimated future benefit payments by year based on expected future service as appropriate are: | ||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | 2020-24 | ||||||||||||||||||||
Expected benefit payments | $ | 15 | $ | 15 | $ | 15 | $ | 15 | $ | 15 | $ | 81 | |||||||||||||
Segment_and_Geographic_Data_Ta
Segment and Geographic Data (Tables) | 12 Months Ended | |||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | Results for our reportable segments were: | |||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Orthopaedics | 4,153 | 3,949 | 3,823 | |||||||||||||||
MedSurg | 3,781 | 3,414 | 3,265 | |||||||||||||||
Neurotechnology & Spine | 1,741 | 1,658 | 1,569 | |||||||||||||||
Net sales | $ | 9,675 | $ | 9,021 | $ | 8,657 | ||||||||||||
Orthopaedics | 319 | 273 | 271 | |||||||||||||||
MedSurg | 113 | 84 | 85 | |||||||||||||||
Neurotechnology & Spine | 134 | 135 | 122 | |||||||||||||||
Other | 19 | 19 | 8 | |||||||||||||||
Depreciation and amortization | $ | 585 | $ | 511 | $ | 486 | ||||||||||||
Orthopaedics | 367 | 365 | 344 | |||||||||||||||
MedSurg | 162 | 167 | 177 | |||||||||||||||
Neurotechnology & Spine | 107 | 98 | 76 | |||||||||||||||
Other | (118 | ) | (127 | ) | (75 | ) | ||||||||||||
Income taxes (credit) | $ | 518 | $ | 503 | $ | 522 | ||||||||||||
Orthopaedics | 1,033 | 988 | 971 | |||||||||||||||
MedSurg | 677 | 638 | 631 | |||||||||||||||
Neurotechnology & Spine | 364 | 333 | 326 | |||||||||||||||
Other | (264 | ) | (245 | ) | (280 | ) | ||||||||||||
Segment net earnings (loss) | $ | 1,810 | $ | 1,714 | $ | 1,648 | ||||||||||||
Less: | ||||||||||||||||||
Acquisition & integration-related charges | (65 | ) | (72 | ) | (37 | ) | ||||||||||||
Amortization of intangible assets | (133 | ) | (98 | ) | (88 | ) | ||||||||||||
Restructuring related charges | (78 | ) | (46 | ) | (59 | ) | ||||||||||||
Rejuvenate and related charges | (628 | ) | (460 | ) | (133 | ) | ||||||||||||
Regulatory and legal matters | — | (63 | ) | (33 | ) | |||||||||||||
Donation | — | (15 | ) | — | ||||||||||||||
Income tax related adjustments | (391 | ) | 46 | — | ||||||||||||||
Net earnings | $ | 515 | $ | 1,006 | $ | 1,298 | ||||||||||||
Sales and Other Financial Information by Business Segment | Total assets and capital spending by reportable segments were: | |||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Orthopaedics | 8,600 | 6,675 | 3,654 | |||||||||||||||
MedSurg | 5,626 | 3,382 | 2,996 | |||||||||||||||
Neurotechnology & Spine | 3,772 | 3,147 | 2,600 | |||||||||||||||
Other | (285 | ) | 2,539 | 3,956 | ||||||||||||||
Total assets | $ | 17,713 | $ | 15,743 | $ | 13,206 | ||||||||||||
Orthopaedics | 80 | 89 | 87 | |||||||||||||||
MedSurg | 77 | 59 | 51 | |||||||||||||||
Neurotechnology & Spine | 20 | 16 | 53 | |||||||||||||||
Other | 56 | 31 | 19 | |||||||||||||||
Capital spending | $ | 233 | $ | 195 | $ | 210 | ||||||||||||
Geographic Information on Net Sales and Long-Lived Assets | Net property, plant and equipment are based upon physical location of the assets. Geographic information follows: | |||||||||||||||||
Net Sales | Net Property, Plant & Equipment | |||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | ||||||||||||||
United States | $ | 6,558 | $ | 5,984 | $ | 5,658 | $ | 539 | $ | 506 | ||||||||
Europe, Middle East, Africa | 1,371 | 1,316 | 1,266 | 417 | 446 | |||||||||||||
Asia Pacific | 1,368 | 1,319 | 1,336 | 119 | 122 | |||||||||||||
Other foreign countries | 378 | 402 | 397 | 23 | 7 | |||||||||||||
$ | 9,675 | $ | 9,021 | $ | 8,657 | $ | 1,098 | $ | 1,081 | |||||||||
Summary_of_Quarterly_Data_Tabl
Summary of Quarterly Data (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||
Summary of Quarterly Data | |||||||||||||||||
2014 Quarter Ended | |||||||||||||||||
31-Mar | Jun 30 | 30-Sep | 31-Dec | ||||||||||||||
Net sales | $ | 2,305 | $ | 2,363 | $ | 2,389 | $ | 2,618 | |||||||||
Gross profit | 1,536 | 1,555 | 1,567 | 1,726 | |||||||||||||
Earnings before income taxes | 107 | 167 | 425 | 461 | |||||||||||||
Net earnings | 70 | 128 | 57 | 260 | |||||||||||||
Net earnings per share of common stock: | |||||||||||||||||
Basic | 0.19 | 0.34 | 0.16 | 0.68 | |||||||||||||
Diluted | 0.18 | 0.33 | 0.16 | 0.67 | |||||||||||||
Market price of common stock: | |||||||||||||||||
High | 83.86 | 86.93 | 85.91 | 98.24 | |||||||||||||
Low | 74.02 | 75.78 | 78.91 | 77.87 | |||||||||||||
Dividends declared per share of common stock | $ | 0.305 | $ | 0.305 | $ | 0.305 | $ | 0.345 | |||||||||
2013 Quarter Ended | |||||||||||||||||
31-Mar | Jun 30 | 30-Sep | 31-Dec | ||||||||||||||
Net sales | $ | 2,190 | $ | 2,212 | $ | 2,151 | $ | 2,468 | |||||||||
Gross profit | 1,477 | 1,482 | 1,469 | 1,616 | |||||||||||||
Earnings before income taxes | 375 | 269 | 137 | 431 | |||||||||||||
Net earnings | 304 | 213 | 103 | 386 | |||||||||||||
Net earnings per share of common stock: | |||||||||||||||||
Basic | 0.8 | 0.56 | 0.27 | 1.02 | |||||||||||||
Diluted | 0.79 | 0.56 | 0.27 | 1.01 | |||||||||||||
Market price of common stock: | |||||||||||||||||
High | 66.92 | 70 | 71.94 | 75.55 | |||||||||||||
Low | 55.24 | 63.35 | 63.71 | 66.93 | |||||||||||||
Dividends declared per share of common stock | $ | 0.265 | $ | 0.265 | $ | 0.265 | $ | 0.305 | |||||||||
Significant_Accounting_Policie2
Significant Accounting Policies (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Minimum [Member] | |
Finite-Lived Intangible Asset, Useful Life | 4 years |
Minimum [Member] | Building and Building Improvements [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Minimum [Member] | Machinery and Equipment [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Maximum [Member] | |
Finite-Lived Intangible Asset, Useful Life | 40 years |
Maximum [Member] | Building and Building Improvements [Member] | |
Property, Plant and Equipment, Useful Life | 30 years |
Maximum [Member] | Machinery and Equipment [Member] | |
Property, Plant and Equipment, Useful Life | 10 years |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Income (AOCI) Accumulated Other Comprehensive Income (AOCI) (Schedule of Amounts Recognized in Other Comprehensive Income (Loss)) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Beginning of Period | $232 | ||
Cost of sales | 3,291 | 2,977 | 2,781 |
Other income (expense), net | -86 | -44 | -36 |
Income taxes | 645 | 206 | 407 |
Other comprehensive loss | -486 | 103 | -15 |
Accumulated Other Comprehensive Income (Loss), End of Period | -254 | 232 | |
Accumulated Other Comprehensive Income (Loss) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Beginning of Period | 232 | 129 | |
Other comprehensive income (OCI) | -490 | 134 | |
Income tax expense on OCI | 16 | -10 | |
Other comprehensive loss | -486 | 103 | -15 |
Accumulated Other Comprehensive Income (Loss), End of Period | -254 | 232 | 129 |
Accumulated Other Comprehensive Income (Loss) | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Cost of sales | -7 | -2 | |
Other income (expense), net | -9 | -21 | |
Income taxes | 4 | 2 | |
Other comprehensive loss | -486 | 103 | |
Accumulated Net Unrealized Investment Gain (Loss) [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Beginning of Period | 0 | 4 | |
Other comprehensive income (OCI) | 12 | 16 | |
Income tax expense on OCI | -2 | 1 | |
Accumulated Other Comprehensive Income (Loss), End of Period | 3 | 0 | |
Accumulated Net Unrealized Investment Gain (Loss) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Cost of sales | 0 | 0 | |
Other income (expense), net | -9 | -21 | |
Income taxes | 2 | 0 | |
Other comprehensive loss | 3 | -4 | |
Accumulated Defined Benefit Plans Adjustment [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Beginning of Period | -81 | -101 | |
Other comprehensive income (OCI) | -72 | 30 | |
Income tax expense on OCI | 22 | -15 | |
Accumulated Other Comprehensive Income (Loss), End of Period | -136 | -81 | |
Accumulated Defined Benefit Plans Adjustment [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Cost of sales | -6 | 7 | |
Other income (expense), net | 0 | 0 | |
Income taxes | 1 | -2 | |
Other comprehensive loss | -55 | 20 | |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Beginning of Period | 7 | 0 | |
Other comprehensive income (OCI) | 10 | 8 | |
Income tax expense on OCI | -4 | 4 | |
Accumulated Other Comprehensive Income (Loss), End of Period | 13 | 7 | |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Cost of sales | -1 | -9 | |
Other income (expense), net | 0 | 0 | |
Income taxes | 1 | 4 | |
Other comprehensive loss | 6 | 7 | |
Accumulated Translation Adjustment [Member] | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Accumulated Other Comprehensive Income (Loss), Beginning of Period | 306 | 226 | |
Other comprehensive income (OCI) | -440 | 80 | |
Accumulated Other Comprehensive Income (Loss), End of Period | ($134) | $306 |
Fair_Value_Measurements_Narrat
Fair Value Measurements (Narrative) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Interest Receivable | $24 | ||
Interest and marketable securities income | $28 | $24 | $47 |
Standard & Poor's, A Rating [Member] | Asset-backed Securities [Member] | |||
Percentage Of Company's Investments With Credit Quality Rating Less Than Single A And A2 | 1.00% | ||
Fitch, A Rating [Member] | Asset-backed Securities [Member] | |||
Percentage Of Company's Investments With Credit Quality Rating Less Than Single A And A2 | 1.00% |
Fair_Value_Measurements_Valuat
Fair Value Measurements (Valuation Of Financial Instruments By Pricing Categories) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
ASSETS | |||
Available-for-sale Securities, Current | $3,205 | $2,641 | |
Assets, Fair Value Disclosure | 5,146 | 4,077 | |
Contingent Consideration Arrangements, Change in Amount of Contingent Consideration [Abstract] | |||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 48 | 59 | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 48 | 59 | |
Liabilities measured at fair value | 140 | 133 | |
Trading Securities | |||
ASSETS | |||
Trading Securities | 80 | 72 | |
(Level 1) | |||
ASSETS | |||
Available-for-sale marketable securities | 1,795 | 1,339 | |
Assets, Fair Value Disclosure | 1,875 | 1,411 | |
Liabilities: | |||
Deferred compensation arrangements | 80 | 72 | |
Contingent Consideration Arrangements, Change in Amount of Contingent Consideration [Abstract] | |||
Liabilities measured at fair value | 80 | 72 | |
(Level 1) | Corporate and asset-backed debt securities | |||
ASSETS | |||
Available-for-sale Securities, Current | 3,229 | 2,641 | |
(Level 1) | Corporate and asset-backed debt securities | Asset-backed Securities [Member] | |||
ASSETS | |||
Available-for-sale Securities, Current | 1,525 | 1,177 | |
(Level 1) | Corporate and asset-backed debt securities | Foreign Government Debt Securities [Member] | |||
ASSETS | |||
Available-for-sale Securities, Current | 726 | 845 | |
(Level 1) | Corporate and asset-backed debt securities | US Government Agencies Debt Securities [Member] | |||
ASSETS | |||
Available-for-sale Securities, Current | 382 | 211 | |
(Level 1) | Corporate and asset-backed debt securities | US Treasury Securities [Member] | |||
ASSETS | |||
Available-for-sale Securities, Current | 474 | 350 | |
(Level 1) | Corporate and asset-backed debt securities | Certificates of Deposit [Member] | |||
ASSETS | |||
Available-for-sale Securities, Current | 110 | 53 | |
(Level 1) | Corporate and asset-backed debt securities | Total available-for-sale marketable securities | |||
ASSETS | |||
Available-for-sale Securities, Current | 12 | 5 | |
(Level 2) | |||
ASSETS | |||
Assets, Fair Value Disclosure | 3,271 | 2,666 | |
Contingent Consideration Arrangements, Change in Amount of Contingent Consideration [Abstract] | |||
Liabilities measured at fair value | 12 | 2 | |
(Level 3) | |||
Contingent Consideration Arrangements, Change in Amount of Contingent Consideration [Abstract] | |||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 59 | 103 | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset and Liability, Gain (Loss) Included in Earnings | 4 | -5 | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset and Liability, Settlements | -15 | -39 | |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 59 | 103 | |
Liabilities measured at fair value | 48 | 59 | |
Interest Rate Swap [Member] | (Level 1) | |||
ASSETS | |||
Foreign currency exchange forward contracts | 10 | 0 | |
Interest rate swap asset | 10 | 0 | |
Foreign Exchange [Member] | |||
Liabilities: | |||
Foreign Currency Contracts, Liability, Fair Value Disclosure | 12 | 2 | |
Foreign Exchange [Member] | (Level 1) | |||
ASSETS | |||
Foreign currency exchange forward contracts | 32 | 25 | |
Interest rate swap asset | $32 | $25 |
Fair_Value_Measurements_Fair_V
Fair Value Measurements Fair Value Measurements (Available-For-Sale Securities) (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Fair Value Disclosures [Abstract] | |
Cost, due in one year or less | $430 |
Cost, due after one year through three years | 2,502 |
Cost, due after three years | 294 |
Estimated fair value, due in one year or less | 430 |
Estimated fair value, due after one year through three years | 2,505 |
Estimated fair value, due after three years | $294 |
Fair_Value_Measurements_Assets
Fair Value Measurements (Assets and Liabilities Measured At Fair Value On A Recurring Basis Using Unobservable Inputs (Level 3)) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Estimated Fair Value | $3,309 | $2,713 |
Available-for-sale Securities [Member] | ||
Estimated Fair Value | 3,229 | 2,641 |
Trading Securities | ||
Estimated Fair Value | 80 | 72 |
Asset-backed Securities [Member] | Available-for-sale Securities [Member] | ||
Amortized Cost | 1,523 | 1,177 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 3 | 1 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -1 | -1 |
Estimated Fair Value | 1,525 | 1,177 |
Foreign Government Debt Securities [Member] | Available-for-sale Securities [Member] | ||
Amortized Cost | 725 | 846 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 2 | 0 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -1 | -1 |
Estimated Fair Value | 726 | 845 |
US Government Agencies Debt Securities [Member] | Available-for-sale Securities [Member] | ||
Amortized Cost | 382 | 211 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 0 | 0 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 0 | 0 |
Estimated Fair Value | 382 | 211 |
US Treasury Securities [Member] | Available-for-sale Securities [Member] | ||
Amortized Cost | 474 | 350 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 0 | 0 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 0 | 0 |
Estimated Fair Value | 474 | 350 |
Certificates of Deposit [Member] | Available-for-sale Securities [Member] | ||
Amortized Cost | 110 | 53 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 0 | 0 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 0 | 0 |
Estimated Fair Value | 110 | 53 |
Total available-for-sale marketable securities | Available-for-sale Securities [Member] | ||
Amortized Cost | 12 | 5 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 0 | 0 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 0 | 0 |
Estimated Fair Value | 12 | 5 |
Available-for-sale Securities [Member] | ||
Estimated Fair Value | 3,205 | 2,641 |
Other Assets [Member] | ||
Estimated Fair Value | 80 | 72 |
Current Assets, Prepaid Expenses, And Other Current Assets [Member] | ||
Estimated Fair Value | $24 | $0 |
Fair_Value_Measurements_Contin
Fair Value Measurements (Contingent Consideration) (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Fair Value Disclosures [Abstract] | |
Fair Value | $48 |
Minimum | 0 |
Maximum | 0 |
Weighted Average | $0 |
Fair_Value_Measurements_Unreal
Fair Value Measurements (Unrealized Losses And Fair Value Of Investments With Unrealized Losses) (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | investment |
Less than 12 months, number of investments | 1,113 |
Less than 12 months, fair value | $3,204 |
Less than 12 months, unrealized losses | -2 |
Total, number of investments | 1,124 |
Total, fair value | 3,229 |
Total, unrealized losses | -2 |
Asset-backed Securities [Member] | |
Less than 12 months, number of investments | 716 |
Less than 12 months, fair value | 1,515 |
Less than 12 months, unrealized losses | -1 |
Total, number of investments | 722 |
Total, fair value | 1,525 |
Total, unrealized losses | -1 |
Foreign Government Debt Securities [Member] | |
Less than 12 months, number of investments | 142 |
Less than 12 months, fair value | 711 |
Less than 12 months, unrealized losses | -1 |
Total, number of investments | 147 |
Total, fair value | 726 |
Total, unrealized losses | -1 |
US Government Agencies Debt Securities [Member] | |
Less than 12 months, number of investments | 91 |
Less than 12 months, fair value | 382 |
Less than 12 months, unrealized losses | 0 |
Total, number of investments | 91 |
Total, fair value | 382 |
Total, unrealized losses | 0 |
Other | |
Less than 12 months, number of investments | 164 |
Less than 12 months, fair value | 596 |
Less than 12 months, unrealized losses | 0 |
Total, number of investments | 164 |
Total, fair value | 596 |
Total, unrealized losses | $0 |
Derivative_Instruments_Narrati
Derivative Instruments (Narrative) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Foreign Exchange Contract [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Foreign currency transaction gains (losses) | $9 | |
Notional amount | 2,442 | 2,344 |
Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains on derivatives designated as hedges | 15 | 12 |
Notional amount | 357 | 344 |
Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional amount | 500 | |
Senior Unsecured Notes 3.375% due 2024 [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Proceeds from Unsecured Notes Payable | 600 | |
Long-term Debt [Member] | Interest Rate Swap [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Increase (Decrease) in Fair Value of Interest Rate Fair Value Hedging Instruments | 10 | |
Other Noncurrent Liabilities [Member] | Interest Rate Swap [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Increase (Decrease) in Fair Value of Interest Rate Fair Value Hedging Instruments | ($10) |
Derivative_Instruments_Forward
Derivative Instruments (Forward Currency Exchange Contracts) (Details) (Foreign Exchange Contract [Member], USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Derivative [Line Items] | ||
Notional amount | $2,442 | $2,344 |
Maximum term | 546 days | 546 days |
Derivative, Fair Value, Net | 20 | 23 |
Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Notional amount | 357 | 344 |
Derivative, Fair Value, Net | 20 | 11 |
Not Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Notional amount | 2,085 | 2,000 |
Derivative, Fair Value, Net | 0 | 12 |
Other Current Assets [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 30 | 21 |
Other Current Assets [Member] | Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 18 | 11 |
Other Current Assets [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 12 | 10 |
Noncurrent Assets- Other [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 2 | 4 |
Noncurrent Assets- Other [Member] | Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 2 | 1 |
Noncurrent Assets- Other [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 0 | 3 |
Accrued Expenses and Other Current Liabilities [Member] | ||
Derivative [Line Items] | ||
Derivative liability | 12 | 2 |
Accrued Expenses and Other Current Liabilities [Member] | Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Derivative liability | 0 | 1 |
Accrued Expenses and Other Current Liabilities [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivative [Line Items] | ||
Derivative liability | $12 | $1 |
Derivative_Instruments_Movemen
Derivative Instruments (Movements out of OCI) (Details) (Foreign Exchange Contract [Member], USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Derivative [Line Items] | |||
Foreign currency transaction gains (losses) | ($7) | $3 | ($7) |
Cost of Sales [Member] | |||
Derivative [Line Items] | |||
Foreign currency transaction gains (losses) | 1 | 0 | 0 |
Other Income (expense) [Member] | |||
Derivative [Line Items] | |||
Foreign currency transaction gains (losses) | ($8) | $3 | ($7) |
Acquisitions_Narrative_Details
Acquisitions (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 |
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 13 years | 13 years | |
Small Bone Innovations [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price paid, including debt | 358 | ||
Finite-Lived Intangible Asset, Useful Life | 12 years | ||
Berchtold [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price paid, including debt | 184 | ||
Trauson [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price paid, including debt | 751 | ||
Patient Safety [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price paid, including debt | 120 | ||
MAKO [Member] | |||
Business Acquisition [Line Items] | |||
Purchase price paid, including debt | 1,677 | ||
Finite-Lived Intangible Asset, Useful Life | 9 years | ||
Customer relationship | |||
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 15 years | 17 years | |
Customer relationship | Trauson [Member] | |||
Business Acquisition [Line Items] | |||
Finite-Lived Intangible Asset, Useful Life | 15 years |
Acquisitions_Allocation_Of_The
Acquisitions (Allocation Of The Preliminary Purchase Price To The Acquired Net Assets Of Acquisitions) (Details) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 01, 2013 | |
Business Acquisition [Line Items] | |||||
Goodwill | $4,186,000,000 | $3,844,000,000 | $3,844,000,000 | $2,142,000,000 | |
Small Bone Innovations [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price paid | 358,000,000 | ||||
Cash | 0 | ||||
Inventory | 34,000,000 | ||||
Other assets | -4,000,000 | ||||
Liabilities | 2,000,000 | ||||
Goodwill | 221,000,000 | ||||
Assets and liabilities acquired, net | 358,000,000 | ||||
Small Bone Innovations [Member] | Customer relationship | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 19,000,000 | ||||
Small Bone Innovations [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 0 | ||||
Small Bone Innovations [Member] | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 82,000,000 | ||||
Small Bone Innovations [Member] | In-process research & development | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 0 | ||||
Berchtold [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price paid | 184,000,000 | ||||
Cash | 12,000,000 | ||||
Inventory | 22,000,000 | ||||
Other assets | -38,000,000 | ||||
Liabilities | 45,000,000 | ||||
Goodwill | 107,000,000 | ||||
Assets and liabilities acquired, net | 184,000,000 | ||||
Berchtold [Member] | Customer relationship | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 11,000,000 | ||||
Berchtold [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 7,000,000 | ||||
Berchtold [Member] | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 32,000,000 | ||||
Berchtold [Member] | In-process research & development | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 0 | ||||
Patient Safety [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price paid | 120,000,000 | ||||
Cash | 0 | ||||
Inventory | 7,000,000 | ||||
Other assets | -19,000,000 | ||||
Liabilities | 33,000,000 | ||||
Goodwill | 68,000,000 | ||||
Assets and liabilities acquired, net | 120,000,000 | ||||
Patient Safety [Member] | Customer relationship | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 33,000,000 | ||||
Patient Safety [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 0 | ||||
Patient Safety [Member] | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 26,000,000 | ||||
Patient Safety [Member] | In-process research & development | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 0 | ||||
Other Acquisitions [Domain] | |||||
Business Acquisition [Line Items] | |||||
Purchase price paid | 216,000,000 | ||||
Cash | 0 | ||||
Inventory | 5,000,000 | ||||
Other assets | -25,000,000 | ||||
Liabilities | 37,000,000 | ||||
Goodwill | 101,000,000 | ||||
Assets and liabilities acquired, net | 216,000,000 | ||||
Other Acquisitions [Domain] | Customer relationship | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 5,000,000 | ||||
Other Acquisitions [Domain] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 0 | ||||
Other Acquisitions [Domain] | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 115,000,000 | ||||
Other Acquisitions [Domain] | In-process research & development | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 2,000,000 | ||||
MAKO [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price paid | 1,679,000,000 | 1,677,000,000 | |||
Cash | 56,000,000 | 56,000,000 | 56,000,000 | ||
Inventory | 41,000,000 | 41,000,000 | 50,000,000 | ||
Other assets | -191,000,000 | -191,000,000 | -118,000,000 | ||
Liabilities | 239,000,000 | 239,000,000 | 277,000,000 | ||
Goodwill | 1,160,000,000 | 1,160,000,000 | 1,217,000,000 | ||
Assets and liabilities acquired, net | 1,677,000,000 | 1,677,000,000 | 1,679,000,000 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Adjustment, purchase price paid | -2,000,000 | ||||
Adjustment, cash | 0 | ||||
Adjustment, inventory | -9,000,000 | ||||
Adjustment, other assets | -73,000,000 | ||||
Adjustment, liabilities | 38,000,000 | ||||
Adjustment, goodwill | -57,000,000 | ||||
Adjustment, assets and liabilities acquired, net | -2,000,000 | ||||
MAKO [Member] | Customer relationship | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 80,000,000 | 80,000,000 | 91,000,000 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Adjustment, intangible assets | -11,000,000 | ||||
MAKO [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 4,000,000 | 4,000,000 | 24,000,000 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Adjustment, intangible assets | -20,000,000 | ||||
MAKO [Member] | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 213,000,000 | 213,000,000 | 231,000,000 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Adjustment, intangible assets | -18,000,000 | ||||
MAKO [Member] | In-process research & development | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 171,000,000 | 171,000,000 | 169,000,000 | ||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments [Abstract] | |||||
Adjustment, intangible assets | 2,000,000 | ||||
Trauson [Member] | |||||
Business Acquisition [Line Items] | |||||
Purchase price paid | 751,000,000 | ||||
Cash | 98,000,000 | 98,000,000 | |||
Inventory | 43,000,000 | 43,000,000 | |||
Other assets | -65,000,000 | -65,000,000 | |||
Liabilities | 87,000,000 | 87,000,000 | |||
Goodwill | 450,000,000 | 450,000,000 | |||
Assets and liabilities acquired, net | 751,000,000 | 751,000,000 | |||
Trauson [Member] | Customer relationship | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 112,000,000 | 112,000,000 | |||
Trauson [Member] | Trade Names [Member] | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 34,000,000 | 34,000,000 | |||
Trauson [Member] | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | 31,000,000 | 31,000,000 | |||
Trauson [Member] | In-process research & development | |||||
Business Acquisition [Line Items] | |||||
Finite-lived Intangible Assets Acquired | $5,000,000 | $5,000,000 |
Goodwill_and_Other_Intangibles2
Goodwill and Other Intangibles (Changes in Net Carrying Amount of Goodwill by Segment) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Goodwill [Roll Forward] | ||
Goodwill, Beginning balance | $3,844 | $2,142 |
Goodwill acquired | 497 | 1,669 |
Foreign currency translation effects and other | -155 | 33 |
Goodwill, Ending balance | 4,186 | 3,844 |
Ortho | ||
Goodwill [Roll Forward] | ||
Goodwill, Beginning balance | 2,227 | 691 |
Goodwill acquired | 243 | 1,559 |
Foreign currency translation effects and other | -84 | -23 |
Goodwill, Ending balance | 2,386 | 2,227 |
MedSurg | ||
Goodwill [Roll Forward] | ||
Goodwill, Beginning balance | 506 | 513 |
Goodwill acquired | 231 | 2 |
Foreign currency translation effects and other | -11 | -9 |
Goodwill, Ending balance | 726 | 506 |
Neuro and Spine | ||
Goodwill [Roll Forward] | ||
Goodwill, Beginning balance | 1,111 | 938 |
Goodwill acquired | 23 | 108 |
Foreign currency translation effects and other | -60 | 65 |
Goodwill, Ending balance | $1,074 | $1,111 |
Goodwill_and_Other_Intangibles3
Goodwill and Other Intangibles (Summary of the Company's Other Intangible Assets) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 13 years | 13 years |
Gross Carrying Amount | $2,986 | $2,833 |
Less Accumulated Amortization | 968 | 844 |
Net Carrying Amount | 2,018 | 1,989 |
Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 13 years | 12 years |
Gross Carrying Amount | 1,468 | 1,450 |
Less Accumulated Amortization | 466 | 380 |
Net Carrying Amount | 1,002 | 1,070 |
Customer relationship | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 15 years | 17 years |
Gross Carrying Amount | 801 | 677 |
Less Accumulated Amortization | 239 | 189 |
Net Carrying Amount | 562 | 488 |
Patents | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 12 years | 13 years |
Gross Carrying Amount | 293 | 238 |
Less Accumulated Amortization | 175 | 190 |
Net Carrying Amount | 118 | 48 |
Trademarks | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 14 years | 14 years |
Gross Carrying Amount | 112 | 127 |
Less Accumulated Amortization | 37 | 34 |
Net Carrying Amount | 75 | 93 |
In-process research & development | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 201 | 223 |
Less Accumulated Amortization | 0 | 0 |
Net Carrying Amount | 201 | 223 |
Other Intangible Assets [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 12 years | 13 years |
Gross Carrying Amount | 111 | 118 |
Less Accumulated Amortization | 51 | 51 |
Net Carrying Amount | $60 | $67 |
Goodwill_and_Other_Intangibles4
Goodwill and Other Intangibles (Estimated Amortization Expense) (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2015 | $196 |
2016 | 166 |
2017 | 164 |
2018 | 148 |
2019 | $132 |
Goodwill_and_Other_Intangibles5
Goodwill and Other Intangibles Goodwill Narrative (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization of intangible assets | $188 | $138 | $123 |
Contingencies_and_Commitments_1
Contingencies and Commitments (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Operating Leases, Rent Expense | $103 | $100 | $98 |
Rejuvenate and ABG II Voluntary Recall [Member] | |||
Loss Contingency, Estimate of Possible Loss | 1,713 | ||
Estimated Litigation Liability | 748 | ||
Estimated Litigation Liability | 179 | ||
Electrical Network Communications, Hospital Beds [Member] | |||
Loss Contingency, Number of Patents | 9 | ||
Patents Under Reexamination [Member] | |||
Loss Contingency, Number of Patents | 6 | ||
Number of Remaining Patents [Member] | |||
Loss Contingency, Number of Patents | 3 | ||
Minimum [Member] | Rejuvenate and ABG II Voluntary Recall [Member] | |||
Loss Contingency, Estimate of Possible Loss | 1,534 | ||
Maximum [Member] | Rejuvenate and ABG II Voluntary Recall [Member] | |||
Loss Contingency, Estimate of Possible Loss | $2,453 | ||
Zimmer Product Infringement [Member] | |||
Gain Contingency, Description | 76 |
Contingencies_and_Commitments_2
Contingencies and Commitments (Future Purchase Obligations and Minimum Lease Payments) (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Purchase obligations | |
2015 | $710 |
2016 | 134 |
2017 | 121 |
2018 | 67 |
2019 | 62 |
Thereafter | 56 |
Minimum lease payments | |
2015 | 60 |
2016 | 45 |
2017 | 33 |
2018 | 25 |
2019 | 19 |
Thereafter | $34 |
LongTerm_Debt_and_Credit_Facil2
Long-Term Debt and Credit Facilities (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $1,250 | ||
Debt instrument, maturity | 397 days | ||
Commercial paper, weighted average interest rate | 0.20% | ||
Remaining borrowing capacity | 1,289 | ||
Weighted average interest rate | 2.90% | ||
Document period end date | 31-Dec-14 | ||
Unamortized debt issuance expense | 21 | ||
Debt instrument, fair value disclosure | 3,811 | 2,790 | |
Interest expense, debt | 113 | 83 | 63 |
Interest paid | 102 | 88 | 55 |
Commercial Paper [Member] | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, maturity | 62 days | ||
Commercial paper | 200 | 0 | |
Senior Unsecured Notes 3.375% due 2024 [Member] | |||
Line of Credit Facility [Line Items] | |||
Proceeds from Unsecured Notes Payable | 600 | ||
Debt Instrument, Interest Rate, Stated Percentage | 3.38% | ||
Senior Unsecured Notes 4.375% due 2044 [Member] | |||
Line of Credit Facility [Line Items] | |||
Proceeds from Unsecured Notes Payable | $400 | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.38% |
LongTerm_Debt_and_Credit_Facil3
Long-Term Debt and Credit Facilities (Maturities Of Long-Term Debt Disclosures) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Other | $29 | $25 |
Total debt | 3,973 | 2,764 |
Less current maturities | -727 | -25 |
Total Long-term Debt | 3,246 | 2,739 |
Senior Unsecured Notes 3.00% Due 2015 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 3.00% | |
Debt Instrument, Maturity Date | 15-Jan-15 | |
Maturities, repayments of principal in next twelve months | 500 | 500 |
Senior Unsecured Notes 2.00% due 2016 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | |
Debt Instrument, Maturity Date | 30-Sep-16 | |
Maturities, repayments of principal in year two | 750 | 749 |
Senior Unsecured Notes 1.30% due 2018 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.30% | |
Debt Instrument, Maturity Date | 1-Apr-18 | |
Maturities, repayments of principal in year four | 598 | 598 |
Senior Unsecured Notes 4.375% Due 2020 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.38% | |
Debt Instrument, Maturity Date | 15-Jan-20 | |
Maturities, repayments of principal after year five | 498 | 498 |
Senior Unsecured Notes 3.375% due 2024 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 3.38% | |
Debt Instrument, Maturity Date | 15-May-24 | |
Maturities, repayments of principal after year five | 605 | 0 |
Senior Unsecured Notes 4.10% due 2043 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.10% | |
Debt Instrument, Maturity Date | 1-Apr-43 | |
Maturities, repayments of principal after year five | 395 | 394 |
Senior Unsecured Notes 4.375% due 2044 [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.38% | |
Debt Instrument, Maturity Date | 15-May-44 | |
Maturities, repayments of principal after year five | 398 | 0 |
Commercial Paper [Member] | ||
Commercial paper | $200 | $0 |
Capital_Stock_Narrative_Detail
Capital Stock (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Capital Stock [Line Items] | |||||||||||
Cash dividends declared, per share of common stock | $0.35 | $0.31 | $0.31 | $0.31 | $0.31 | $0.27 | $0.27 | $0.27 | $1.26 | $1.10 | $0.90 |
Stock Repurchased and Retired During Period, Shares | 1,300,000 | 4,800,000 | 2,100,000 | ||||||||
Stock Repurchased and Retired During Period, Value | $100 | $317 | $108 | ||||||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | 583 | 583 | |||||||||
Common Stock, Capital Shares Reserved for Future Issuance | 19,000,000 | 23,000,000 | 19,000,000 | 23,000,000 | |||||||
Preferred Stock, Capital Shares Reserved for Future Issuance | 500,000 | 500,000 | |||||||||
Preferred Stock, Par or Stated Value Per Share | $1 | $1 | |||||||||
Options granted for period in number of years | 10 years | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $15.80 | $15.24 | $13.36 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | 113 | 97 | 52 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Lower Range Limit | $38.71 | ||||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit | $81.14 | ||||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | 64 | 64 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 6 months | ||||||||||
2012 $405.0 Million Repurchase Agreement [Member] | |||||||||||
Capital Stock [Line Items] | |||||||||||
Stock Repurchase Program, Authorized Amount | 405 | ||||||||||
2011 $500.0 Million Repurchase Agreement [Member] | |||||||||||
Capital Stock [Line Items] | |||||||||||
Stock Repurchase Program, Authorized Amount | 500 | ||||||||||
Stock Repurchased and Retired During Period, Shares | 1,300,000 | ||||||||||
Stock Repurchased and Retired During Period, Value | 100 | ||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||
Capital Stock [Line Items] | |||||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | 45 | 45 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 10 months 24 days | ||||||||||
Weighted average grant date fair value, granted | $76.61 | $60.81 | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award Fair Value | 39 | ||||||||||
Performance Stock Units (PSUs) [Member] | |||||||||||
Capital Stock [Line Items] | |||||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $9 | $9 | |||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year | ||||||||||
Weighted average grant date fair value, granted | $81.14 | ||||||||||
Employee Stock Purchase Plans [Member] | |||||||||||
Capital Stock [Line Items] | |||||||||||
Percentage of Closing Stock Price Represents Purchase Price Under ESPP | 95.00% | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period | 150,167 | 163,533 |
Capital_Stock_Capital_Stock_Op
Capital Stock Capital Stock (Option Grant Assumptions) (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Capital Stock [Abstract] | |||
Risk-free interest rate | 2.10% | 1.30% | 1.30% |
Expected dividend yield | 1.80% | 1.90% | 1.50% |
Expected stock price volatility | 20.20% | 27.90% | 27.60% |
Expected option life | 7 years 1 month | 7 years 1 month | 7 years 1 month |
Capital_Stock_Summary_of_Stock
Capital Stock (Summary of Stock Option Activity) (Details) (USD $) | 12 Months Ended |
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Shares, Options outstanding at January 1 | 17 |
Shares, Granted | 2.5 |
Shares, Exercised | -3.7 |
Shares, Cancelled | -0.6 |
Shares, Options outstanding at December 31 | 15.2 |
Shares, Exercisable at December 31 | 8.7 |
Shares, Options expected to vest | 6 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Weighted average exercise price, Options outstanding at January 1 | $55.35 |
Weighted average excercise price, Granted | $81.13 |
Weighted average exercise price, Exercised | $52.20 |
Weighted average exercise price, Cancelled | $65.23 |
Weighted average exercise price, Options outstanding at December 31 | $59.97 |
Weighted average exercise price, Exercisable at December 31 | $54.34 |
Weighted average exercise price, Options expected to vest | $67.17 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |
Weighted-average remaining contractual term, Options outstanding at December 31 | 5 years 7 months 6 days |
Weighted-average remaining contractual term, Exercisable at December 31 | 3 years 9 months 18 days |
Weighted-average remaining contractual term, Options expected to vest | 8 years |
Aggregate intrinsic value, Options outstanding at December 31 | $524.20 |
Aggregate intrinsic value, Exercisable at December 31 | 349.7 |
Aggregate intrinsic value, Options expected to vest | $163.20 |
Capital_Stock_Capital_Stock_Su
Capital Stock Capital Stock (Summary of RSU and PSU Activity) (Details) (USD $) | 12 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Restricted Stock Units (RSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Shares, Nonvested at January 1 | 1.5 | |
Shares, Granted | 0.6 | |
Shares, Vested | -0.7 | |
Shares, Cancelled | -0.1 | |
Shares, Nonvested at December 31 | 1.3 | 1.5 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Weighted average grant date fair value, Outstanding at January 1 | $56.19 | |
Weighted average grant date fair value, granted | $76.61 | $60.81 |
Weighted average grant date fair value, Vested | $55.71 | |
Weighted average grant date fair value, Cancelled | $63.45 | |
Weighted average grant date fair value, Outstanding at December 31 | $65.04 | $56.19 |
Performance Stock Units (PSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Shares, Nonvested at January 1 | 0.3 | |
Shares, Granted | 0.1 | |
Shares, Vested | 0.1 | |
Shares, Nonvested at December 31 | 0.3 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Weighted average grant date fair value, Outstanding at January 1 | $58.10 | |
Weighted average grant date fair value, granted | $81.14 | |
Weighted average grant date fair value, Vested | $56.53 | |
Weighted average grant date fair value, Cancelled | $57.12 | |
Weighted average grant date fair value, Outstanding at December 31 | $66.18 |
Income_Taxes_Income_Taxes_Narr
Income Taxes Income Taxes (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Contingency [Line Items] | |||
Operating Loss Carryforwards | $376 | ||
Unrecognized Tax Benefits, Interest on Income Taxes Expense | 307 | 194 | |
Reinvestment of Future Remittances of Undistributed Earnings of Foreign Subsidiaries | 5,878 | ||
Deferred Federal Income Tax Expense (Benefit) | 78 | 16 | 16 |
UNITED STATES | |||
Income Tax Contingency [Line Items] | |||
Operating Loss Carryforwards | 288 | ||
Foreign Tax Authority [Member] | |||
Income Tax Contingency [Line Items] | |||
Operating Loss Carryforwards | 88 | ||
Operating Loss Carryforwards, Valuation Allowance | 43 | ||
Tax Credit Carryforward, Valuation Allowance | $31 |
Income_Taxes_Schedule_of_Earni
Income Taxes (Schedule of Earnings before Income Taxes) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | |||||||||||
United States | $355 | $193 | $591 | ||||||||
International | 805 | 1,019 | 1,114 | ||||||||
Earnings before income taxes | $461 | $425 | $167 | $107 | $431 | $137 | $269 | $375 | $1,160 | $1,212 | $1,705 |
Income_Taxes_Schedule_of_Provi
Income Taxes (Schedule of Provision for Income Taxes) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Current income tax expense | |||
United States federal | $213 | $79 | $227 |
United States state and local | 26 | 29 | 41 |
International | 346 | 75 | 178 |
Total current income tax expense | 585 | 183 | 446 |
Deferred income tax expense (benefit) | |||
United States federal | 9 | -52 | -12 |
United States state and local | -16 | -4 | -9 |
International | 67 | 79 | -18 |
Total deferred income tax expense (benefit) | 60 | 23 | -39 |
Total income tax expense | 645 | 206 | 407 |
Interest expense and penalties included in other income (expense) | $8 | $12 | ($4) |
Income_Taxes_Schedule_of_Recon
Income Taxes (Schedule of Reconciliation of U.S. Statutory Income Tax Rate to Company's Effective Income Tax Rate from Continuing Operations) (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
United States federal statutory rate | 35.00% | 35.00% | 35.00% |
United States state and local income taxes, less federal deduction | 2.20% | 1.40% | 1.70% |
International operations | 4.90% | -13.70% | -12.10% |
Tax related to repatriation of foreign earnings | 10.10% | 0.00% | -0.40% |
Other | 3.40% | -5.70% | -0.30% |
Total | 55.60% | 17.00% | 23.90% |
Income_Taxes_Schedule_of_Diffe
Income Taxes (Schedule of Difference in Income Tax Effects Comprising Company's Deferred Income Tax Assets and Liabilities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Deferred income tax assets: | ||
Inventories | $585 | $607 |
Product related liabilities | 167 | 67 |
Other accrued expenses | 226 | 221 |
Depreciation and amortization | 44 | 46 |
State income taxes | 68 | 53 |
Share-based compensation | 90 | 101 |
Net operating loss carryforwards | 123 | 124 |
Other | 143 | 107 |
Total deferred income tax assets | 1,446 | 1,326 |
Less valuation allowances | -42 | -39 |
Total deferred income tax assets after valuation allowances | 1,404 | 1,287 |
Deferred income tax liabilities: | ||
Depreciation and amortization | -666 | -668 |
Undistributed earnings | 132 | 16 |
Other | -54 | -86 |
Total deferred income tax liabilities | -852 | -770 |
Net deferred income tax assets | 552 | 517 |
Current assetsbDeferred income taxes | 989 | 880 |
Noncurrent assetsbOther | 39 | 34 |
Current liabilitiesbAccrued expenses and other liabilities | -3 | |
Noncurrent liabilitiesbOther liabilities | -473 | -397 |
Accrued interest and penalties reported as accrued expenses and other liabilities | $26 | $34 |
Income_Taxes_Schedule_of_Unres
Income Taxes (Schedule of Unresolved Income Tax Positions) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance at beginning of year | $204 | $227 |
Increases related to current year income tax positions | 133 | 22 |
Increases related to prior year income tax positions | 23 | 56 |
Settlements and resolutions of income tax audits | -33 | -37 |
Statute of limitations expirations | -1 | -64 |
Foreign currency translation | 6 | 0 |
Other | -5 | 0 |
Balance at end of year | 315 | 204 |
Current liabilitiesbIncome taxes | 3 | 10 |
Noncurrent liabilitiesbOther liabilities | $312 | $194 |
Retirement_Plans_Retirement_Pl
Retirement Plans Retirement Plans (Narrative) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | ||
Estimated net actuarial loss for the defined benefit pension plans to be recognized from accumulated other comprehensive gain (loss) | $9 | |
Pesnion plans with an accumulated benefit obligation in excess of plan assets - projected benefit obligations | 570 | 456 |
Pension plans with an accumulated benefit obligation in excess of plan assets - accumulated benefit obligations | 533 | 427 |
Pesnion plans with an accumulated benefit obligation in excess of plan assets - fair value of plan assets | 0 | 281 |
Defined Benefit Plans, Estimated Future Employer Contributions in Next Fiscal Year | $19 |
Retirement_Plans_Retirement_Pl1
Retirement Plans Retirement Plans (Schedule of Defined Contribution Retirement Plan) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |||
Plan expense | $132 | $132 | $112 |
Expense funded with Stryker common stock | 18 | 16 | 15 |
Dollar amount | $198 | $150 | $104 |
Shares (in millions of shares) | 2.1 | 2 | 1.9 |
Value as a percentage of total plan assets | 11.00% | 9.00% | 9.00% |
Retirement_Plans_Schedule_of_F
Retirement Plans (Schedule of Funded Status and Components of the Amounts Recognized in the Consolidated Balance Sheets and in Accumulated Other Comprehensive Gain (Loss), Before the Effect of Income Taxes) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
General Discussion of Pension and Other Postretirement Benefits [Abstract] | ||
Fair value of plan assets | $310 | $281 |
Benefit obligations | 570 | 456 |
Funded status | -260 | -175 |
Current liabilitiesbaccrued compensation | 1 | 1 |
Noncurrent liabilitiesbother liabilities | 259 | 174 |
Unrecognized net actuarial loss | 195 | 115 |
Unrecognized prior service cost | 15 | 12 |
Pension and Other Postretirement Benefit Plans, Accumulated Other Comprehensive Income (Loss), before Tax | ($180) | ($103) |
Retirement_Plans_Schedule_of_C
Retirement Plans (Schedule of Company's Defined Benefit Pension Plans) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Change in Benefit Obligations: | |||
Beginning Projected benefit obligations | $456 | ||
Service cost | -26 | -30 | -21 |
Interest cost | -13 | -13 | -13 |
Actuarial (gains) losses | -88 | 28 | -87 |
Ending Projected benefit obligations | 570 | 456 | |
Ending Accumulated benefit obligations | 533 | 427 | |
Change in Plan Assets: | |||
Beginning Fair value of plan assets | 281 | ||
Ending Fair value of plan assets | 310 | 281 | |
Change in projected benefit obligations [Member] | |||
Change in Benefit Obligations: | |||
Beginning Projected benefit obligations | 456 | 447 | |
Service cost | 26 | 30 | |
Interest cost | 13 | 13 | |
Foreign exchange impact | -43 | 2 | |
Employee contributions | 6 | 6 | |
Actuarial (gains) losses | 134 | -29 | |
Plan amendments | -5 | -1 | |
Acquisitions | 5 | 0 | |
Benefits paid | -22 | -12 | |
Ending Projected benefit obligations | 570 | 456 | |
Change in Plan Assets: | |||
Employee contributions | 6 | 6 | |
Foreign exchange impact | -43 | 2 | |
Acquisitions | 5 | 0 | |
Benefits paid | -22 | -12 | |
Change in plan assets [Member] | |||
Change in Benefit Obligations: | |||
Foreign exchange impact | -24 | 1 | |
Employee contributions | 6 | 6 | |
Acquisitions | 3 | 0 | |
Benefits paid | -20 | -11 | |
Change in Plan Assets: | |||
Beginning Fair value of plan assets | 281 | 254 | |
Actual return | 46 | 11 | |
Employer contributions | 18 | 20 | |
Employee contributions | 6 | 6 | |
Foreign exchange impact | -24 | 1 | |
Acquisitions | 3 | 0 | |
Benefits paid | -20 | -11 | |
Ending Fair value of plan assets | $310 | $281 |
Retirement_Plans_Schedule_of_N
Retirement Plans (Schedule of Net Periodic Benefit Cost and Other Changes in Plan Assets and Benefit Obligations Recognized n Other Comprehensive Gain (Loss), Before the Effect of Income Taxes) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |||
Service cost | ($26) | ($30) | ($21) |
Interest cost | -13 | -13 | -13 |
Expected return on plan assets | 10 | 10 | 9 |
Amortization of prior service cost and transition amount | 1 | 1 | 1 |
Recognized actuarial loss | -7 | -8 | -5 |
Net periodic benefit cost | -35 | -40 | -29 |
Net actuarial gain (loss) | -88 | 28 | -87 |
Recognized net actuarial loss | 7 | 8 | 5 |
Prior service cost and transition amount | 4 | -1 | |
Total recognized in OCI | -77 | 35 | -82 |
Total recognized in net periodic benefit cost and OCI | ($112) | ($5) | ($111) |
Discount rate | 3.20% | 2.90% | 4.20% |
Expected return on plan assets | 3.70% | 3.70% | 4.20% |
Rate of compensation increase | 2.90% | 3.00% | 3.00% |
Weighted-average discount rate used to determine projected benefit obligations | 2.00% | 3.20% | 2.90% |
Retirement_Plans_Schedule_of_W
Retirement Plans (Schedule of Weighted-Average Allocation of Plan Assets by Asset Category and of Weighted-Average Target Investment Allocation Ranges fro the Plans) (Details) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Target Plan Asset Allocations | 100.00% | |
Actual Plan Asset Allocations | 100.00% | 100.00% |
Equity Securities [Member] | ||
Target Plan Asset Allocations | 30.00% | |
Actual Plan Asset Allocations | 30.00% | 34.00% |
Debt Securities | ||
Target Plan Asset Allocations | 50.00% | |
Actual Plan Asset Allocations | 48.00% | 46.00% |
Other | ||
Target Plan Asset Allocations | 20.00% | |
Actual Plan Asset Allocations | 22.00% | 20.00% |
Retirement_Plans_Schedule_of_V
Retirement Plans (Schedule of Valuation of the Company's Pension Plan Assets by Pricing Categories) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $310 | $281 | |
(Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 269 | 249 | |
(Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 8 | 10 | |
(Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 33 | 22 | 23 |
Cash and Cash Equivalents [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 6 | 10 | |
Cash and Cash Equivalents [Member] | (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 6 | 10 | |
Cash and Cash Equivalents [Member] | (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Cash and Cash Equivalents [Member] | (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Equity Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 125 | 94 | |
Equity Securities [Member] | (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 125 | 94 | |
Equity Securities [Member] | (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Equity Securities [Member] | (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Corporate Debt Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 121 | 129 | |
Corporate Debt Securities [Member] | (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 121 | 127 | |
Corporate Debt Securities [Member] | (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 2 | |
Corporate Debt Securities [Member] | (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Other | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 58 | 48 | |
Other | (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 17 | 18 | |
Other | (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 8 | 8 | |
Other | (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $33 | $22 |
Retirement_Plans_Schedule_of_R
Retirement Plans (Schedule of Rollforward of Pension Plan Assets Measured at Fair Value on a Recurring Basis Using Unobservable Inputs (Level 3)) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Ending Fair value of plan assets | $310 | $281 |
(Level 3) | ||
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Beginning Fair value of plan assets | 22 | 23 |
Actual return on plan assets held at the reporting date | 11 | 0 |
Purchases, sales, and settlements | 0 | -1 |
Ending Fair value of plan assets | $33 | $22 |
Retirement_Plans_Estimated_Fut
Retirement Plans (Estimated Future Benefit Payments, which Reflect Expected Future Service) (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
2015 | $15 |
2016 | 15 |
2017 | 15 |
2018 | 15 |
2019 | 15 |
2020-2024 | $81 |
Segment_and_Geographic_Data_Sa
Segment and Geographic Data (Sales And Other Financial Information By Business Segment) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $2,618 | $2,389 | $2,363 | $2,305 | $2,468 | $2,151 | $2,212 | $2,190 | $9,675 | $9,021 | $8,657 |
Income taxes | 645 | 206 | 407 | ||||||||
Segment net earnings (loss) | 1,246 | 1,256 | 1,741 | ||||||||
Intangible asset amortization | 188 | 138 | 123 | ||||||||
Net earnings | 260 | 57 | 128 | 70 | 386 | 103 | 213 | 304 | 515 | 1,006 | 1,298 |
Number of Reportable Segments | 3 | ||||||||||
Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation and amortization | 585 | 511 | 486 | ||||||||
Income taxes | 518 | 503 | 522 | ||||||||
Segment net earnings (loss) | 1,810 | 1,714 | 1,648 | ||||||||
Segment Reconciling Items | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Acquisition & integration-related charges | -65 | -72 | -65 | -72 | -37 | ||||||
Intangible asset amortization | -133 | -98 | -88 | ||||||||
Restructuring related charges | -78 | -46 | -59 | ||||||||
Less Rejuvenate and related charges | 628 | 460 | 133 | ||||||||
Regulatory and legal matters | 0 | -63 | -33 | ||||||||
Less donation | 0 | 15 | 0 | ||||||||
Add income tax adjustments | -391 | 46 | 0 | ||||||||
Net earnings | 515 | 1,006 | 1,298 | ||||||||
Ortho | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 4,153 | 3,949 | 3,823 | ||||||||
Depreciation and amortization | 319 | 273 | 271 | ||||||||
Income taxes | 367 | 365 | 344 | ||||||||
Segment net earnings (loss) | 1,033 | 988 | 971 | ||||||||
MedSurg | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 3,781 | 3,414 | 3,265 | ||||||||
Depreciation and amortization | 113 | 84 | 85 | ||||||||
Income taxes | 162 | 167 | 177 | ||||||||
Segment net earnings (loss) | 677 | 638 | 631 | ||||||||
Neuro and Spine | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 1,741 | 1,658 | 1,569 | ||||||||
Depreciation and amortization | 134 | 135 | 122 | ||||||||
Income taxes | 107 | 98 | 76 | ||||||||
Segment net earnings (loss) | 364 | 333 | 326 | ||||||||
Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation and amortization | 19 | 19 | 8 | ||||||||
Income taxes | -118 | -127 | -75 | ||||||||
Segment net earnings (loss) | ($264) | ($245) | ($280) |
Segment_and_Geographic_Data_Se
Segment and Geographic Data Segment and Geographic Data (Segment Information) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
segment | |||
Segment Reporting Information [Line Items] | |||
Number of Reportable Segments | 3 | ||
Assets | $17,713 | $15,743 | $13,206 |
Capital Expenditures During Period | 233 | 195 | 210 |
Ortho | |||
Segment Reporting Information [Line Items] | |||
Assets | 8,600 | 6,675 | 3,654 |
Capital Expenditures During Period | 80 | 89 | 87 |
MedSurg | |||
Segment Reporting Information [Line Items] | |||
Assets | 5,626 | 3,382 | 2,996 |
Capital Expenditures During Period | 77 | 59 | 51 |
Neuro and Spine | |||
Segment Reporting Information [Line Items] | |||
Assets | 3,772 | 3,147 | 2,600 |
Capital Expenditures During Period | 20 | 16 | 53 |
Other | |||
Segment Reporting Information [Line Items] | |||
Assets | -285 | 2,539 | 3,956 |
Capital Expenditures During Period | $56 | $31 | $19 |
Segment_and_Geographic_Data_Ge
Segment and Geographic Data (Geographic Information on Net Sales and Long-Lived Assets) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $2,618 | $2,389 | $2,363 | $2,305 | $2,468 | $2,151 | $2,212 | $2,190 | $9,675 | $9,021 | $8,657 |
Net Property, Plant & Equipment | 1,098 | 1,081 | 1,098 | 1,081 | |||||||
United States | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 6,558 | 5,984 | 5,658 | ||||||||
Net Property, Plant & Equipment | 539 | 506 | 539 | 506 | |||||||
Europe, Middle East, and Africa | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 1,371 | 1,316 | 1,266 | ||||||||
Net Property, Plant & Equipment | 417 | 446 | 417 | 446 | |||||||
Asia Pacific | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 1,368 | 1,319 | 1,336 | ||||||||
Net Property, Plant & Equipment | 119 | 122 | 119 | 122 | |||||||
Other foreign countries | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 378 | 402 | 397 | ||||||||
Net Property, Plant & Equipment | $23 | $7 | $23 | $7 |
Summary_of_Quarterly_Data_Deta
Summary of Quarterly Data (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Quarterly Financial Data [Abstract] | |||||||||||
Net sales | $2,618 | $2,389 | $2,363 | $2,305 | $2,468 | $2,151 | $2,212 | $2,190 | $9,675 | $9,021 | $8,657 |
Gross profit | 1,726 | 1,567 | 1,555 | 1,536 | 1,616 | 1,469 | 1,482 | 1,477 | 6,384 | 6,044 | 5,876 |
Earnings before income taxes | 461 | 425 | 167 | 107 | 431 | 137 | 269 | 375 | 1,160 | 1,212 | 1,705 |
Net earnings | $260 | $57 | $128 | $70 | $386 | $103 | $213 | $304 | $515 | $1,006 | $1,298 |
Earnings Per Share, Basic | $0.68 | $0.16 | $0.34 | $0.19 | $1.02 | $0.27 | $0.56 | $0.80 | $1.36 | $2.66 | $3.41 |
Earnings Per Share, Diluted | $0.67 | $0.16 | $0.33 | $0.18 | $1.01 | $0.27 | $0.56 | $0.79 | $1.34 | $2.63 | $3.39 |
Market Price Of Common Stock, High | $98.24 | $85.91 | $86.93 | $83.86 | $75.55 | $71.94 | $70 | $66.92 | |||
Market Price Of Common Stock, Low | $77.87 | $78.91 | $75.78 | $74.02 | $66.93 | $63.71 | $63.35 | $55.24 | |||
Dividends declared per share of common stock | $0.35 | $0.31 | $0.31 | $0.31 | $0.31 | $0.27 | $0.27 | $0.27 | $1.26 | $1.10 | $0.90 |