Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2022 shares | |
Document Information [Line Items] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Sep. 30, 2022 |
Document Transition Report | false |
Entity File Number | 001-13149 |
Entity Registrant Name | STRYKER CORP |
Entity Incorporation, State or Country Code | MI |
Entity Tax Identification Number | 38-1239739 |
Entity Address, Address Line One | 2825 Airview Boulevard |
Entity Address, City or Town | Kalamazoo, |
Entity Address, State or Province | MI |
Entity Address, Postal Zip Code | 49002 |
City Area Code | (269) |
Local Phone Number | 385-2600 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 378,429,929 |
Amendment Flag | false |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | Q3 |
Entity Central Index Key | 0000310764 |
Current Fiscal Year End Date | --12-31 |
Common Stock | |
Document Information [Line Items] | |
Title of each class | Common Stock, $.10 Par Value |
Trading Symbol | SYK |
Security Exchange Name | NYSE |
Senior Unsecured Notes 1.125% due 2021 | |
Document Information [Line Items] | |
Title of each class | 1.125% Notes due 2023 |
Trading Symbol | SYK23 |
Security Exchange Name | NYSE |
Senior Unsecured Notes, 0.250% Due 2024 | |
Document Information [Line Items] | |
Title of each class | 0.250% Notes due 2024 |
Trading Symbol | SYK24A |
Security Exchange Name | NYSE |
Senior Unsecured Notes 2.125% due 2027 | |
Document Information [Line Items] | |
Title of each class | 2.125% Notes due 2027 |
Trading Symbol | SYK27 |
Security Exchange Name | NYSE |
Senior Unsecured Notes, 0.750% Due 2029 | |
Document Information [Line Items] | |
Title of each class | 0.750% Notes due 2029 |
Trading Symbol | SYK29 |
Security Exchange Name | NYSE |
Senior Unsecured Notes 2.625% due 2030 | |
Document Information [Line Items] | |
Title of each class | 2.625% Notes due 2030 |
Trading Symbol | SYK30 |
Security Exchange Name | NYSE |
Senior Unsecured Notes, 1.000% Due 2031 | |
Document Information [Line Items] | |
Title of each class | 1.000% Notes due 2031 |
Trading Symbol | SYK31 |
Security Exchange Name | NYSE |
CONSOLIDATED STATEMENTS OF EARN
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Net sales | $ 4,479 | $ 4,160 | $ 13,247 | $ 12,407 |
Cost of sales | 1,697 | 1,518 | 4,905 | 4,484 |
Gross profit | 2,782 | 2,642 | 8,342 | 7,923 |
Research, development and engineering expenses | 364 | 306 | 1,128 | 904 |
Selling, general and administrative expenses | 1,455 | 1,602 | 4,704 | 4,682 |
Recall charges | (4) | 16 | 14 | 98 |
Amortization of intangible assets | 159 | 144 | 469 | 474 |
Total operating expenses | 1,974 | 2,068 | 6,315 | 6,158 |
Operating income | 808 | 574 | 2,027 | 1,765 |
Other income (expense), net | 8 | (79) | (105) | (241) |
Earnings before income taxes | 816 | 495 | 1,922 | 1,524 |
Income taxes | 0 | 57 | 127 | 192 |
Net earnings | $ 816 | $ 438 | $ 1,795 | $ 1,332 |
Net earnings per share of common stock: | ||||
Basic | $ 2.16 | $ 1.17 | $ 4.75 | $ 3.54 |
Diluted | $ 2.14 | $ 1.14 | $ 4.70 | $ 3.48 |
Weighted-average shares outstanding (in millions): | ||||
Basic | 378.4 | 377.1 | 378.1 | 376.8 |
Effect of dilutive employee stock compensation | 3.4 | 5.6 | 4.1 | 5.5 |
Diluted | 381.8 | 382.7 | 382.2 | 382.3 |
Cash dividends declared per share of common stock (in dollars per share) | $ 0.695 | $ 0.63 | $ 2.085 | $ 1.89 |
CONSOLIDATED STATEMENTS OF EA_2
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)(Parenthetical) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Anti-dilutive shares excluded from calculation of dilutive employee stock options (in shares) | 5 | 0 | 4.2 | 0 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 816 | $ 438 | $ 1,795 | $ 1,332 |
Other comprehensive income (loss), net of tax: | ||||
Marketable securities | 0 | 3 | (1) | 3 |
Pension plans | 10 | 5 | 17 | 8 |
Unrealized gains (losses) on designated hedges | 8 | 7 | 33 | 43 |
Financial statement translation | 179 | 112 | 393 | 287 |
Total other comprehensive income (loss), net of tax | 197 | 127 | 442 | 341 |
Comprehensive income | $ 1,013 | $ 565 | $ 2,237 | $ 1,673 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 1,420 | $ 2,944 |
Marketable securities | 77 | 75 |
Accounts receivable, less allowance of $150 ($167 in 2021) | 3,103 | 3,022 |
Inventories: | ||
Materials and supplies | 852 | 691 |
Work in process | 309 | 264 |
Finished goods | 2,722 | 2,359 |
Total inventories | 3,883 | 3,314 |
Prepaid expenses and other current assets | 835 | 662 |
Total current assets | 9,318 | 10,017 |
Property, plant and equipment: | ||
Land, buildings and improvements | 1,665 | 1,656 |
Machinery and equipment | 3,869 | 3,842 |
Total property, plant and equipment | 5,534 | 5,498 |
Less accumulated depreciation | 2,736 | 2,665 |
Property, plant and equipment, net | 2,798 | 2,833 |
Goodwill | 14,993 | 12,918 |
Other intangibles, net | 5,053 | 4,840 |
Noncurrent deferred income tax assets | 1,390 | 1,760 |
Other noncurrent assets | 2,431 | 2,263 |
Total assets | 35,983 | 34,631 |
Current liabilities | ||
Accounts payable | 1,213 | 1,129 |
Accrued compensation | 927 | 1,092 |
Income taxes | 243 | 192 |
Dividends payable | 263 | 263 |
Accrued product liabilities | 391 | 401 |
Accrued expenses and other liabilities | 1,526 | 1,465 |
Current maturities of debt | 8 | 7 |
Total current liabilities | 4,571 | 4,549 |
Long-term debt, excluding current maturities | 12,751 | 12,472 |
Income taxes | 621 | 913 |
Other noncurrent liabilities | 1,577 | 1,820 |
Total liabilities | 19,520 | 19,754 |
Shareholders' equity | ||
Common stock, $0.10 par value | 38 | 38 |
Additional paid-in capital | 2,028 | 1,890 |
Retained earnings | 14,486 | 13,480 |
Accumulated other comprehensive loss | (89) | (531) |
Total shareholders' equity | 16,463 | 14,877 |
Total liabilities and shareholders' equity | $ 35,983 | $ 34,631 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 150 | $ 167 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at Dec. 31, 2020 | $ 38 | $ 1,741 | $ 12,462 | $ (1,157) | |
Beginning balance (in shares) at Dec. 31, 2020 | 376.1 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock compensation and benefit plans | (7) | ||||
Issuance of common stock under stock option and benefit plans (in shares) | 1.1 | ||||
Share-based compensation | 141 | ||||
Net earnings | $ 1,332 | 1,332 | |||
Cash dividends declared | (713) | ||||
Other comprehensive income (loss) | 341 | 341 | |||
Ending balance at Sep. 30, 2021 | 14,178 | $ 38 | 1,875 | 13,081 | (816) |
Ending balance (in shares) at Sep. 30, 2021 | 377.2 | ||||
Beginning balance at Jun. 30, 2021 | $ 38 | 1,844 | 12,881 | (943) | |
Beginning balance (in shares) at Jun. 30, 2021 | 377.1 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock compensation and benefit plans | $ 0 | (3) | |||
Issuance of common stock under stock option and benefit plans (in shares) | 0.1 | ||||
Share-based compensation | 34 | ||||
Net earnings | 438 | 438 | |||
Cash dividends declared | (238) | ||||
Other comprehensive income (loss) | 127 | 127 | |||
Ending balance at Sep. 30, 2021 | 14,178 | $ 38 | 1,875 | 13,081 | (816) |
Ending balance (in shares) at Sep. 30, 2021 | 377.2 | ||||
Beginning balance at Dec. 31, 2021 | 14,877 | $ 38 | 1,890 | 13,480 | (531) |
Beginning balance (in shares) at Dec. 31, 2021 | 377.5 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock compensation and benefit plans | $ 0 | (2) | |||
Issuance of common stock under stock option and benefit plans (in shares) | 0.9 | ||||
Share-based compensation | 140 | ||||
Net earnings | 1,795 | 1,795 | |||
Cash dividends declared | (789) | ||||
Other comprehensive income (loss) | 442 | 442 | |||
Ending balance at Sep. 30, 2022 | 16,463 | $ 38 | 2,028 | 14,486 | (89) |
Ending balance (in shares) at Sep. 30, 2022 | 378.4 | ||||
Beginning balance at Jun. 30, 2022 | $ 38 | 1,989 | 13,933 | (286) | |
Beginning balance (in shares) at Jun. 30, 2022 | 378.3 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under stock compensation and benefit plans | $ 0 | 6 | |||
Issuance of common stock under stock option and benefit plans (in shares) | 0.1 | ||||
Share-based compensation | 33 | ||||
Net earnings | 816 | 816 | |||
Cash dividends declared | (263) | ||||
Other comprehensive income (loss) | 197 | 197 | |||
Ending balance at Sep. 30, 2022 | $ 16,463 | $ 38 | $ 2,028 | $ 14,486 | $ (89) |
Ending balance (in shares) at Sep. 30, 2022 | 378.4 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating activities | ||
Net earnings | $ 1,795 | $ 1,332 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation | 276 | 278 |
Amortization of intangible assets | 469 | 474 |
Asset impairments | 18 | 119 |
Share-based compensation | 140 | 141 |
Recall charges | 14 | 98 |
Sale of inventory stepped-up to fair value at acquisition | 12 | 231 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (186) | (145) |
Inventories | (754) | (231) |
Accounts payable | 111 | 134 |
Accrued expenses and other liabilities | 5 | 184 |
Recall-related payments | (26) | (180) |
Income taxes | (262) | (193) |
Other, net | 9 | 21 |
Net cash provided by operating activities | 1,621 | 2,263 |
Investing activities | ||
Acquisitions, net of cash acquired | (2,563) | (226) |
Purchases of marketable securities | (43) | (38) |
Proceeds from sales of marketable securities | 40 | 43 |
Purchases of property, plant and equipment | (400) | (319) |
Proceeds from settlement of net investment hedges | 197 | 0 |
Other investing, net | 7 | (5) |
Net cash used in investing activities | (2,762) | (545) |
Financing activities | ||
Proceeds (payments) on short-term borrowings, net | (376) | 7 |
Proceeds from issuance of long-term debt | 1,500 | 5 |
Payments on long-term debt | (502) | (1,151) |
Payments of dividends | (788) | (713) |
Cash paid for taxes from withheld shares | (89) | (88) |
Other financing, net | (48) | (137) |
Net cash provided by (used in) financing activities | (303) | (2,077) |
Effect of exchange rate changes on cash and cash equivalents | (80) | (21) |
Change in cash and cash equivalents | (1,524) | (380) |
Cash and cash equivalents at beginning of period | 2,944 | 2,943 |
Cash and cash equivalents at end of period | $ 1,420 | $ 2,563 |
Basis Of Presentation
Basis Of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | BASIS OF PRESENTATION General Information Management believes the accompanying unaudited Consolidated Financial Statements contain all adjustments, including normal recurring items, considered necessary to fairly present the financial position of Stryker Corporation and its consolidated subsidiaries ("Stryker," the "Company," "we," "us" or "our") on September 30, 2022 a nd the results of operations for the three and nine months 2022. The results of operations included in these Consolidated Financial Statements may not necessarily be indicative of our annual results. These statements should be read in conjunction with our Annual Report on Form 10-K for 2021. New Accounting Pronouncements Not Yet Adopted We evaluate all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB) for consideration of their applicability. ASUs not included in our disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on our Consolidated Financial Statements. In September 2022 the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations, which requires entities that utilize supplier finance programs in connection with the purchase of goods and services to disclose information about the key terms of the programs, a rollforward of the obligations under the programs and where those obligations are presented in the balance sheet. The new disclosure requirements are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating these new expanded disclosure requirements. New Accounting Pronouncements Recently Adopted On January 1, 2022 we adopted ASU 2021-08, Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . This update requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers . The adoption of this update did not have a material impact on our Consolidated Financial Statements. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2022 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | REVENUE RECOGNITION Our policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for 2021. We disaggregate our net sales by product line and geographic location for each of our segments as we believe it best depicts how the nature, amount, timing and certainty of our net sales and cash flows are affected by economic factors. Net Sales by Product Line Three Months Nine Months 2022 2021 2022 2021 MedSurg and Neurotechnology: Instruments $ 535 $ 525 $ 1,626 $ 1,511 Endoscopy 590 525 1,728 1,512 Medical 765 636 2,095 1,898 Neurovascular 294 295 901 885 Neuro Cranial 332 299 992 890 Other 72 69 218 203 $ 2,588 $ 2,349 $ 7,560 $ 6,899 Orthopaedics and Spine: Knees $ 481 $ 439 $ 1,445 $ 1,325 Hips 347 328 1,038 990 Trauma and Extremities 672 639 2,033 1,953 Spine 280 282 849 867 Other 111 123 322 373 $ 1,891 $ 1,811 $ 5,687 $ 5,508 Total $ 4,479 $ 4,160 $ 13,247 $ 12,407 Net Sales by Geography Three Months 2022 Three Months 2021 United States International United States International MedSurg and Neurotechnology: Instruments $ 425 $ 110 $ 415 $ 110 Endoscopy 480 110 418 107 Medical 625 140 496 140 Neurovascular 110 184 113 182 Neuro Cranial 274 58 244 55 Other 71 1 68 1 $ 1,985 $ 603 $ 1,754 $ 595 Orthopaedics and Spine: Knees $ 365 $ 116 $ 321 $ 118 Hips 225 122 199 129 Trauma and Extremities 494 178 447 192 Spine 206 74 201 81 Other 85 26 97 26 $ 1,375 $ 516 $ 1,265 $ 546 Total $ 3,360 $ 1,119 $ 3,019 $ 1,141 Net Sales by Geography Nine Months 2022 Nine Months 2021 United States International United States International MedSurg and Neurotechnology: Instruments $ 1,290 $ 336 $ 1,171 $ 340 Endoscopy 1,371 357 1,179 333 Medical 1,686 409 1,457 441 Neurovascular 333 568 339 546 Neuro Cranial 819 173 724 166 Other 214 4 200 3 $ 5,713 $ 1,847 $ 5,070 $ 1,829 Orthopaedics and Spine: Knees $ 1,078 $ 367 $ 964 $ 361 Hips 657 381 606 384 Trauma and Extremities 1,470 563 1,362 591 Spine 615 234 611 256 Other 243 79 290 83 $ 4,063 $ 1,624 $ 3,833 $ 1,675 Total $ 9,776 $ 3,471 $ 8,903 $ 3,504 Contract Assets and Liabilities On September 30, 2022 and December 31, 2021 contract assets recorded in our Consolidated Balance Sheets were not significant. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income (AOCI) | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive (Loss) Income (AOCI) | ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME (AOCI) Three Months 2022 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (1) $ (148) $ 65 $ (202) $ (286) OCI — 11 19 304 334 Income taxes — (3) (1) (119) (123) Reclassifications to: Cost of sales — — (7) — (7) Other (income) expense, net — 3 (2) (8) (7) Income taxes — (1) (1) 2 — Net OCI $ — $ 10 $ 8 $ 179 $ 197 Ending $ (1) $ (138) $ 73 $ (23) $ (89) Three Months 2021 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (3) $ (256) $ 26 $ (710) $ (943) OCI 4 2 6 71 83 Income taxes — — (2) 47 45 Reclassifications to: Cost of sales — — 4 — 4 Other (income) expense, net — 4 (2) (8) (6) Income taxes (1) (1) 1 2 1 Net OCI $ 3 $ 5 $ 7 $ 112 $ 127 Ending $ — $ (251) $ 33 $ (598) $ (816) Nine Months 2022 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ — $ (155) $ 40 $ (416) $ (531) OCI (1) 15 55 658 727 Income taxes — (3) (7) (242) (252) Reclassifications to: Cost of sales — — (10) — (10) Other (income) expense, net — 7 (4) (30) (27) Income taxes — (2) (1) 7 4 Net OCI $ (1) $ 17 $ 33 $ 393 $ 442 Ending $ (1) $ (138) $ 73 $ (23) $ (89) Nine Months 2021 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (3) $ (259) $ (10) $ (885) $ (1,157) OCI 4 1 40 269 314 Income taxes — (2) (13) 37 22 Reclassifications to: Cost of sales — — 9 — 9 Other (income) expense, net — 12 7 (25) (6) Income taxes (1) (3) — 6 2 Net OCI $ 3 $ 8 $ 43 $ 287 $ 341 Ending $ — $ (251) $ 33 $ (598) $ (816) |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS We use operational and economic hedges, foreign currency exchange forward contracts, net investment hedges (both derivative and non-derivative financial instruments) and interest rate derivative instruments to manage the impact of currency exchange and interest rate fluctuations on earnings, cash flow and equity. We do not enter into derivative instruments for speculative purposes. We are exposed to potential credit loss in the event of nonperformance by our counterparties on our outstanding derivative instruments but do not anticipate nonperformance by any of our counterparties. Should a counterparty default, our maximum loss exposure is the asset balance of the instrument. We have not changed our hedging strategies, accounting practices or objectives from those disclosed in our Annual Report on Form 10-K for 2021. Foreign Currency Hedges September 2022 Cash Flow Net Investment Non-Designated Total Gross notional amount $ 923 $ 1,448 $ 3,137 $ 5,508 Maximum term in years 4.1 Fair value: Other current assets $ 45 $ — $ 140 $ 185 Other noncurrent assets 3 185 — 188 Other current liabilities (7) — (10) (17) Other noncurrent liabilities (1) — — (1) Total fair value $ 40 $ 185 $ 130 $ 355 December 2021 Cash Flow Net Investment Non-Designated Total Gross notional amount $ 973 $ 2,266 $ 5,512 $ 8,751 Maximum term in years 4.9 Fair value: Other current assets $ 15 $ 39 $ 92 $ 146 Other noncurrent assets 1 65 — 66 Other current liabilities (7) — (10) (17) Total fair value $ 9 $ 104 $ 82 $ 195 We had €1.5 billion and €2.0 billion on September 30, 2022 and December 31, 2021 of certain foreign currency forward contracts designated as net investment hedges to hedge a portion of our investments in certain of our entities with functional currencies denominated in Euros. In addition to these derivative financial instruments designated as net investment hedges, we had €4.4 billion on September 30, 2022 and December 31, 2021 of senior unsecured notes designated as net investment hedges to selectively hedge portions of our investment in certain international subsidiaries. The currency effects of our Euro-denominated senior unsecured notes are reflected in AOCI within shareholders' equity where they offset gains and losses recorded on our net investment in international subsidiaries. In the nine months 2022 we settled certain foreign currency forward contracts designated as net investment hedges resulting in cash proceeds of $197. The amounts in AOCI related to settled net investment hedges will remain in AOCI until the hedged investment is either sold or substantially liquidated. On September 30, 2022 the total after tax gain (loss) in AOCI related to designated net investment hedges was $603. Net Currency Exchange Rate Gains (Losses) Derivative Three Months Nine Months instrument: Recorded in: 2022 2021 2022 2021 Cash Flow Cost of sales $ 7 $ (4) $ 10 $ (9) Net Investment Other income (expense), net 8 8 30 25 Non-Designated Other income (expense), net (1) (5) 2 (6) Total $ 14 $ (1) $ 42 $ 10 Pretax gains (losses) on derivatives designated as cash flow hedges of $50 and net investment hedges of $34 recorded in AOCI are expected to be reclassified to cost of sales and other income (expense), net in earnings within 12 months as of September 30, 2022. This cash flow hedge reclassification is primarily due to the sale of inventory that includes previously hedged purchases. A component of the AOCI amounts related to net investment hedges is reclassified over the life of the hedge instruments as we elected to exclude the initial value of the component related to the spot-forward difference from the effectiveness assessment. Interest Rate Hedges Pretax gains of $5 recorded in AOCI related to other interest rate hedges closed in conjunction with debt issuances are expected to be reclassified to other income (expense), net in earnings within 12 months of September 30, 2022. The cash flow effect of interest rate hedges is recorded in cash flow from operations. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Our policies for managing risk related to foreign currency, interest rates, credit and markets and our process for determining fair value have not changed from those described in our Annual Report on Form 10-K for 2021. During the three months 2022 we determined that certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded a $110 reduction in the fair value of contingent consideration reflected in selling, general and administrative expenses. There were no significant transfers into or out of any level of the fair value hierarchy in 2022. Assets Measured at Fair Value September December 2022 2021 Cash and cash equivalents $ 1,420 $ 2,944 Trading marketable securities 155 193 Level 1 - Assets $ 1,575 $ 3,137 Available-for-sale marketable securities: Corporate and asset-backed debt securities $ 43 $ 48 Foreign government debt securities 1 2 United States agency debt securities 2 5 United States Treasury debt securities 30 19 Certificates of deposit 1 1 Total available-for-sale marketable securities $ 77 $ 75 Foreign currency exchange forward contracts 373 212 Level 2 - Assets $ 450 $ 287 Total assets measured at fair value $ 2,025 $ 3,424 Liabilities Measured at Fair Value September December 2022 2021 Deferred compensation arrangements $ 155 $ 193 Level 1 - Liabilities $ 155 $ 193 Foreign currency exchange forward contracts $ 18 $ 17 Level 2 - Liabilities $ 18 $ 17 Contingent consideration: Beginning $ 306 $ 393 Additions 1 62 Change in estimate (137) (1) Settlements (47) (148) Ending $ 123 $ 306 Level 3 - Liabilities $ 123 $ 306 Total liabilities measured at fair value $ 296 $ 516 Fair Value of Available for Sale Securities by Maturity September 2022 December 2021 Due in one year or less $ 50 $ 36 Due after one year through three years $ 27 $ 39 On September 30, 2022 and December 31, 2021 the aggregate difference between the cost and fair value of available-for-sale marketable securities was nominal. Interest and marketable securities income was $26 and $15 in the three months and $61 and $50 in the nine months 2022 and 2021, which was recorded in other income (expense), net. |
Contingencies and Commitments
Contingencies and Commitments | 9 Months Ended |
Sep. 30, 2022 | |
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, intellectual property and other matters, the most significant of which 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 had 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, is recorded. 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 self-insured for certain 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 April 2022 the United States District Court for the District of Delaware issued a judgment following a jury verdict in favor of PureWick Corporation (PureWick) for its 2019 complaint seeking patent infringement damages related to our PrimaFit and PrimoFit products. The court awarded damages and we recorded charges of $28 in March 2022. In June 2022 PureWick filed a motion to seek enhancement of the judgment and if successful, the judgment could total approximately $100 and include an injunction against future sales. We intend to appeal the outcome of this case. Recall Matters 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. In November 2014 we entered into a settlement agreement to compensate eligible United States patients who had revision surgery prior to November 3, 2014 and in December 2016 the settlement program was extended to patients who had revision surgery prior to December 19, 2016. In September 2020 we entered into a second settlement agreement to compensate eligible United States patients who had revision surgery prior to September 9, 2020. There are remaining lawsuits that we will continue to defend against. In August 2016 and May 2018 we voluntarily recalled certain lot-specific sizes and offsets of LFIT Anatomic CoCr V40 Femoral Heads. Product liability lawsuits and claims relating to this voluntary recall have been filed against us. In November 2018 we entered into a settlement agreement to resolve a significant number of claims and lawsuits related to the recalls. In April 2022 we executed a second agreement to resolve a significant number of claims and lawsuits related to the recalls. The specific terms of the settlement agreement, including the financial terms, are confidential. With the acquisition of Wright Medical Group N.V. (Wright) in November 2020, we are responsible for certain product liability claims, primarily related to certain hip products sold by Wright prior to its 2014 divestiture of the OrthoRecon business. We will continue to evaluate each claim and the possible loss we may incur. We have incurred, and expect to incur in the future, costs associated with the defense and settlement of these matters. For the nine months 2022 we have recorded charges of $14 primarily related to Wright hip products and made payments of $26 primarily related to Rejuvenate and ABG II Modular-Neck hip stems. Based on the information that has been received, we have estimated the remaining range of probable loss related to recall matters globally to be approximately $375 to $510. We have recorded reserves representing the remaining minimum of the range of probable loss. The final outcomes of these matters are dependent on many factors that are difficult to predict. Accordingly the ultimate cost related to these matters may be materially different than the amount of our current estimate and accruals and could have a material adverse effect on our results of operations and cash flows. Leases September December 2022 2021 Right-of-use assets $ 456 $ 419 Lease liabilities, current $ 116 $ 112 Lease liabilities, non-current $ 349 $ 310 Other information: Weighted-average remaining lease term 5.5 years 5.4 years Weighted-average discount rate 3.09 % 2.86 % Three Months Nine Months 2022 2021 2022 2021 Operating lease cost $ 37 $ 35 $ 110 $ 102 |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2022 | |
Business Combinations [Abstract] | |
Acquisitions | ACQUISITIONS We acquire stock in companies and various assets that continue to support our capital deployment and product development strategies. The aggregate purchase price of our acquisitions, net of cash acquired was $2,563 and $267 in the nine months 2022 and 2021. In February 2022 we completed the acquisition of Vocera Communications, Inc. (Vocera) for $79.25 per share, or an aggregate purchase price of $2.6 billion, net of cash acquired ($3.0 billion including convertible notes). Vocera is a leader in the digital care coordination and communication category. Vocera is part of our Medical business within MedSurg and Neurotechnology. Goodwill attributable to the acquisition reflects the strategic benefits of expanding our presence in adjacent markets, diversifying our product portfolio, advancing innovations, and accelerating our digital aspirations. This goodwill is not deductible for tax purposes . In the nine months 2022 note holders elected to redeem the 1.50% and 0.50% convertible notes assumed in the Vocera acquisition for $101 and $324. These repayments are classified as financing activities in the Consolidated Statements of Cash Flows. Share-based awards for Vocera employees vested upon our acquisition and a charge of $132 was recorded in selling, general and administrative expenses in 2022. Purchase price allocations for our significant acquisitions are: Purchase Price Allocation of Acquired Net Assets 2022 Vocera Tangible assets and liabilities: Accounts receivable $ 33 Inventory 13 Deferred income tax assets 73 Other assets 92 Debt (425) Deferred income tax liabilities (182) Other liabilities (115) Intangible assets: Customer and distributor relationships 550 Developed technology and patents 178 Trade name 18 Goodwill 2,328 Purchase price, net of cash acquired of $281 $ 2,563 Weighted-average life of intangible assets 13 Purchase price allocations for Vocera were based on preliminary valuations, primarily related to intangible assets and deferred income taxes. Our estimates and assumptions are subject to change within the measurement period. Consolidated Estimated Amortization Expense Remainder of 2022 2023 2024 2025 2026 $ 159 $ 617 $ 587 $ 567 $ 510 |
Debt and Credit Facilities
Debt and Credit Facilities | 9 Months Ended |
Sep. 30, 2022 | |
Long-term Debt, Unclassified [Abstract] | |
Debt And Credit Facilities | DEBT AND CREDIT FACILITIES We have lines of credit issued by various financial institutions that are available to fund our day-to-day operating needs. Certain of our credit facilities require us to comply with financial and other covenants. We were in compliance with all covenants on September 30, 2022. In February 2022 we entered into a $1.5 billion term loan agreement that matures on February 22, 2025 and bears interest at a base rate based on the Term Secured Overnight Financing Rate (SOFR) plus 0.725%. In the nine months 2022 we repaid $500 on the term loan. In 2022 our Board of Directors approved an increase to the maximum amount of commercial paper that can be outstanding from $1,500 to $2,250. On September 30, 2022 there were no borrowings outstanding under our credit facility or commercial paper program which allows for maturities up to 397 days from the date of issuance. Summary of Total Debt September 2022 December 2021 Rate Due Senior unsecured notes: 1.125% November 30, 2023 $ 530 $ 622 0.600% December 1, 2023 599 598 3.375% May 15, 2024 595 593 0.250% December 3, 2024 817 958 1.150% June 15, 2025 647 645 3.375% November 1, 2025 748 748 3.500% March 15, 2026 995 994 2.125% November 30, 2027 720 845 3.650% March 7, 2028 597 597 0.750% March 1, 2029 767 901 1.950% June 15, 2030 991 990 2.625% November 30, 2030 619 727 1.000% December 3, 2031 715 840 4.100% April 1, 2043 392 392 4.375% May 15, 2044 395 395 4.625% March 15, 2046 982 982 2.900% June 15, 2050 642 642 Term loan February 22, 2025 1,000 — Other 8 10 Total debt $ 12,759 $ 12,479 Less current maturities of debt 8 7 Total long-term debt $ 12,751 $ 12,472 September 2022 December 2021 Unamortized debt issuance costs $ 55 $ 62 Borrowing capacity on existing facilities $ 2,162 $ 2,162 Fair value of senior unsecured notes $ 10,401 $ 13,391 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax [Abstract] | |
Income Taxes | INCOME TAXESOur effective tax rates were 0.0% and 6.6% in the three and nine months 2022. In the three months 2022 income tax expense decreased $162 due to the effective settlement of the United States federal income tax audit for years 2014 through 2018. In addition, other income (expense), net includes a benefit of $50 related to the release of accrued interest associated with this settlement. The nine months 2022 additionally include the reversal of deferred income tax on undistributed earnings of foreign subsidiaries no longer determined to be indefinitely reinvested. Our effective tax rates of 11.5% and 12.6% in the three and nine months 2021 include certain discrete tax items. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION As previously disclosed, effective December 31, 2021 we changed our reportable business segments to (i) MedSurg and Neurotechnology and (ii) Orthopaedics and Spine to align to our new internal reporting structure. We have reflected these changes in all historical periods presented. Three Months Nine Months 2022 2021 2022 2021 MedSurg and Neurotechnology $ 2,588 $ 2,349 $ 7,560 $ 6,899 Orthopaedics and Spine 1,891 1,811 5,687 5,508 Net sales $ 4,479 $ 4,160 $ 13,247 $ 12,407 MedSurg and Neurotechnology $ 626 $ 663 $ 1,838 $ 2,000 Orthopaedics and Spine 519 500 1,648 1,518 Segment operating income $ 1,145 $ 1,163 $ 3,486 $ 3,518 Items not allocated to segments: Corporate and other $ (144) $ (105) $ (488) $ (421) Acquisition and integration-related costs 78 (126) (108) (495) Amortization of intangible assets (159) (144) (469) (474) Restructuring-related and other charges (58) (178) (229) (209) Medical device regulations (38) (27) (98) (72) Recall-related matters 4 (16) (14) (98) Regulatory and legal matters (20) 7 (53) 16 Consolidated operating income $ 808 $ 574 $ 2,027 $ 1,765 There w ere no significant changes to total assets by segment from information provided in our Annual Report on Form 10-K for 2021, other than the addition of the assets acquired in the Vocera acquisition which are included in the MedSurg and Neurotechnology segment. |
Asset Impairments
Asset Impairments | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Asset Impairments | ASSET IMPAIRMENTS The government in China has launched regional and national programs for volume-based procurement ("VBP") of high-value medical consumables to reduce healthcare costs. Each VBP program has specific requirements to award contracts to the lowest bidders who are able to satisfy the quality and quantity requirements. The successful bidders may be guaranteed sales volume for certain products, while unsuccessful bidders may lose unit sales volume. The prices required for a successful bid have negatively impacted our existing commercial operations of joint replacement and trauma products in China. As a result of the outcome of certain regional programs for our trauma products and the national VBP program for hips and knees we recorded charges of $105 to impair certain long-lived and intangible assets in the third quarter of 2021. These charges were included in selling, general and administrative expenses. The national VBP program for spine products took place in the third quarter of 2022 and we were unsuccessful in our bid. As a result we are exiting the spine business in China. Asset impairments recorded in the three months 2022 were not significant. Our total business in China represented approximately 2.5% of our revenues for the nine months 2022. |
Basis Of Presentation (Policies
Basis Of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Not Yet Adopted We evaluate all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB) for consideration of their applicability. ASUs not included in our disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on our Consolidated Financial Statements. In September 2022 the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations, which requires entities that utilize supplier finance programs in connection with the purchase of goods and services to disclose information about the key terms of the programs, a rollforward of the obligations under the programs and where those obligations are presented in the balance sheet. The new disclosure requirements are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating these new expanded disclosure requirements. New Accounting Pronouncements Recently Adopted On January 1, 2022 we adopted ASU 2021-08, Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . This update requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers . The adoption of this update did not have a material impact on our Consolidated Financial Statements. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue Recognition [Abstract] | |
Schedule of Disaggregated Revenue | We disaggregate our net sales by product line and geographic location for each of our segments as we believe it best depicts how the nature, amount, timing and certainty of our net sales and cash flows are affected by economic factors. Net Sales by Product Line Three Months Nine Months 2022 2021 2022 2021 MedSurg and Neurotechnology: Instruments $ 535 $ 525 $ 1,626 $ 1,511 Endoscopy 590 525 1,728 1,512 Medical 765 636 2,095 1,898 Neurovascular 294 295 901 885 Neuro Cranial 332 299 992 890 Other 72 69 218 203 $ 2,588 $ 2,349 $ 7,560 $ 6,899 Orthopaedics and Spine: Knees $ 481 $ 439 $ 1,445 $ 1,325 Hips 347 328 1,038 990 Trauma and Extremities 672 639 2,033 1,953 Spine 280 282 849 867 Other 111 123 322 373 $ 1,891 $ 1,811 $ 5,687 $ 5,508 Total $ 4,479 $ 4,160 $ 13,247 $ 12,407 Net Sales by Geography Three Months 2022 Three Months 2021 United States International United States International MedSurg and Neurotechnology: Instruments $ 425 $ 110 $ 415 $ 110 Endoscopy 480 110 418 107 Medical 625 140 496 140 Neurovascular 110 184 113 182 Neuro Cranial 274 58 244 55 Other 71 1 68 1 $ 1,985 $ 603 $ 1,754 $ 595 Orthopaedics and Spine: Knees $ 365 $ 116 $ 321 $ 118 Hips 225 122 199 129 Trauma and Extremities 494 178 447 192 Spine 206 74 201 81 Other 85 26 97 26 $ 1,375 $ 516 $ 1,265 $ 546 Total $ 3,360 $ 1,119 $ 3,019 $ 1,141 Net Sales by Geography Nine Months 2022 Nine Months 2021 United States International United States International MedSurg and Neurotechnology: Instruments $ 1,290 $ 336 $ 1,171 $ 340 Endoscopy 1,371 357 1,179 333 Medical 1,686 409 1,457 441 Neurovascular 333 568 339 546 Neuro Cranial 819 173 724 166 Other 214 4 200 3 $ 5,713 $ 1,847 $ 5,070 $ 1,829 Orthopaedics and Spine: Knees $ 1,078 $ 367 $ 964 $ 361 Hips 657 381 606 384 Trauma and Extremities 1,470 563 1,362 591 Spine 615 234 611 256 Other 243 79 290 83 $ 4,063 $ 1,624 $ 3,833 $ 1,675 Total $ 9,776 $ 3,471 $ 8,903 $ 3,504 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive (Loss) Income (AOCI) (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Three Months 2022 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (1) $ (148) $ 65 $ (202) $ (286) OCI — 11 19 304 334 Income taxes — (3) (1) (119) (123) Reclassifications to: Cost of sales — — (7) — (7) Other (income) expense, net — 3 (2) (8) (7) Income taxes — (1) (1) 2 — Net OCI $ — $ 10 $ 8 $ 179 $ 197 Ending $ (1) $ (138) $ 73 $ (23) $ (89) Three Months 2021 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (3) $ (256) $ 26 $ (710) $ (943) OCI 4 2 6 71 83 Income taxes — — (2) 47 45 Reclassifications to: Cost of sales — — 4 — 4 Other (income) expense, net — 4 (2) (8) (6) Income taxes (1) (1) 1 2 1 Net OCI $ 3 $ 5 $ 7 $ 112 $ 127 Ending $ — $ (251) $ 33 $ (598) $ (816) Nine Months 2022 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ — $ (155) $ 40 $ (416) $ (531) OCI (1) 15 55 658 727 Income taxes — (3) (7) (242) (252) Reclassifications to: Cost of sales — — (10) — (10) Other (income) expense, net — 7 (4) (30) (27) Income taxes — (2) (1) 7 4 Net OCI $ (1) $ 17 $ 33 $ 393 $ 442 Ending $ (1) $ (138) $ 73 $ (23) $ (89) Nine Months 2021 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (3) $ (259) $ (10) $ (885) $ (1,157) OCI 4 1 40 269 314 Income taxes — (2) (13) 37 22 Reclassifications to: Cost of sales — — 9 — 9 Other (income) expense, net — 12 7 (25) (6) Income taxes (1) (3) — 6 2 Net OCI $ 3 $ 8 $ 43 $ 287 $ 341 Ending $ — $ (251) $ 33 $ (598) $ (816) |
Reclassification out of Accumulated Other Comprehensive Income | Three Months 2022 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (1) $ (148) $ 65 $ (202) $ (286) OCI — 11 19 304 334 Income taxes — (3) (1) (119) (123) Reclassifications to: Cost of sales — — (7) — (7) Other (income) expense, net — 3 (2) (8) (7) Income taxes — (1) (1) 2 — Net OCI $ — $ 10 $ 8 $ 179 $ 197 Ending $ (1) $ (138) $ 73 $ (23) $ (89) Three Months 2021 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (3) $ (256) $ 26 $ (710) $ (943) OCI 4 2 6 71 83 Income taxes — — (2) 47 45 Reclassifications to: Cost of sales — — 4 — 4 Other (income) expense, net — 4 (2) (8) (6) Income taxes (1) (1) 1 2 1 Net OCI $ 3 $ 5 $ 7 $ 112 $ 127 Ending $ — $ (251) $ 33 $ (598) $ (816) Nine Months 2022 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ — $ (155) $ 40 $ (416) $ (531) OCI (1) 15 55 658 727 Income taxes — (3) (7) (242) (252) Reclassifications to: Cost of sales — — (10) — (10) Other (income) expense, net — 7 (4) (30) (27) Income taxes — (2) (1) 7 4 Net OCI $ (1) $ 17 $ 33 $ 393 $ 442 Ending $ (1) $ (138) $ 73 $ (23) $ (89) Nine Months 2021 Marketable Securities Pension Plans Hedges Financial Statement Translation Total Beginning $ (3) $ (259) $ (10) $ (885) $ (1,157) OCI 4 1 40 269 314 Income taxes — (2) (13) 37 22 Reclassifications to: Cost of sales — — 9 — 9 Other (income) expense, net — 12 7 (25) (6) Income taxes (1) (3) — 6 2 Net OCI $ 3 $ 8 $ 43 $ 287 $ 341 Ending $ — $ (251) $ 33 $ (598) $ (816) |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | September 2022 Cash Flow Net Investment Non-Designated Total Gross notional amount $ 923 $ 1,448 $ 3,137 $ 5,508 Maximum term in years 4.1 Fair value: Other current assets $ 45 $ — $ 140 $ 185 Other noncurrent assets 3 185 — 188 Other current liabilities (7) — (10) (17) Other noncurrent liabilities (1) — — (1) Total fair value $ 40 $ 185 $ 130 $ 355 December 2021 Cash Flow Net Investment Non-Designated Total Gross notional amount $ 973 $ 2,266 $ 5,512 $ 8,751 Maximum term in years 4.9 Fair value: Other current assets $ 15 $ 39 $ 92 $ 146 Other noncurrent assets 1 65 — 66 Other current liabilities (7) — (10) (17) Total fair value $ 9 $ 104 $ 82 $ 195 |
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location | Derivative Three Months Nine Months instrument: Recorded in: 2022 2021 2022 2021 Cash Flow Cost of sales $ 7 $ (4) $ 10 $ (9) Net Investment Other income (expense), net 8 8 30 25 Non-Designated Other income (expense), net (1) (5) 2 (6) Total $ 14 $ (1) $ 42 $ 10 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets Measured at Fair Value September December 2022 2021 Cash and cash equivalents $ 1,420 $ 2,944 Trading marketable securities 155 193 Level 1 - Assets $ 1,575 $ 3,137 Available-for-sale marketable securities: Corporate and asset-backed debt securities $ 43 $ 48 Foreign government debt securities 1 2 United States agency debt securities 2 5 United States Treasury debt securities 30 19 Certificates of deposit 1 1 Total available-for-sale marketable securities $ 77 $ 75 Foreign currency exchange forward contracts 373 212 Level 2 - Assets $ 450 $ 287 Total assets measured at fair value $ 2,025 $ 3,424 Liabilities Measured at Fair Value September December 2022 2021 Deferred compensation arrangements $ 155 $ 193 Level 1 - Liabilities $ 155 $ 193 Foreign currency exchange forward contracts $ 18 $ 17 Level 2 - Liabilities $ 18 $ 17 Contingent consideration: Beginning $ 306 $ 393 Additions 1 62 Change in estimate (137) (1) Settlements (47) (148) Ending $ 123 $ 306 Level 3 - Liabilities $ 123 $ 306 Total liabilities measured at fair value $ 296 $ 516 |
Investments Classified by Contractual Maturity Date | Fair Value of Available for Sale Securities by Maturity September 2022 December 2021 Due in one year or less $ 50 $ 36 Due after one year through three years $ 27 $ 39 |
Contingencies and Commitments (
Contingencies and Commitments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Lease, Cost | Leases September December 2022 2021 Right-of-use assets $ 456 $ 419 Lease liabilities, current $ 116 $ 112 Lease liabilities, non-current $ 349 $ 310 Other information: Weighted-average remaining lease term 5.5 years 5.4 years Weighted-average discount rate 3.09 % 2.86 % Three Months Nine Months 2022 2021 2022 2021 Operating lease cost $ 37 $ 35 $ 110 $ 102 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | Purchase price allocations for our significant acquisitions are: Purchase Price Allocation of Acquired Net Assets 2022 Vocera Tangible assets and liabilities: Accounts receivable $ 33 Inventory 13 Deferred income tax assets 73 Other assets 92 Debt (425) Deferred income tax liabilities (182) Other liabilities (115) Intangible assets: Customer and distributor relationships 550 Developed technology and patents 178 Trade name 18 Goodwill 2,328 Purchase price, net of cash acquired of $281 $ 2,563 Weighted-average life of intangible assets 13 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Consolidated Estimated Amortization Expense Remainder of 2022 2023 2024 2025 2026 $ 159 $ 617 $ 587 $ 567 $ 510 |
Debt and Credit Facilities (Tab
Debt and Credit Facilities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of Long-term Debt Instruments | Summary of Total Debt September 2022 December 2021 Rate Due Senior unsecured notes: 1.125% November 30, 2023 $ 530 $ 622 0.600% December 1, 2023 599 598 3.375% May 15, 2024 595 593 0.250% December 3, 2024 817 958 1.150% June 15, 2025 647 645 3.375% November 1, 2025 748 748 3.500% March 15, 2026 995 994 2.125% November 30, 2027 720 845 3.650% March 7, 2028 597 597 0.750% March 1, 2029 767 901 1.950% June 15, 2030 991 990 2.625% November 30, 2030 619 727 1.000% December 3, 2031 715 840 4.100% April 1, 2043 392 392 4.375% May 15, 2044 395 395 4.625% March 15, 2046 982 982 2.900% June 15, 2050 642 642 Term loan February 22, 2025 1,000 — Other 8 10 Total debt $ 12,759 $ 12,479 Less current maturities of debt 8 7 Total long-term debt $ 12,751 $ 12,472 September 2022 December 2021 Unamortized debt issuance costs $ 55 $ 62 Borrowing capacity on existing facilities $ 2,162 $ 2,162 Fair value of senior unsecured notes $ 10,401 $ 13,391 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Sales and Other Financial Information by Business Segment | Three Months Nine Months 2022 2021 2022 2021 MedSurg and Neurotechnology $ 2,588 $ 2,349 $ 7,560 $ 6,899 Orthopaedics and Spine 1,891 1,811 5,687 5,508 Net sales $ 4,479 $ 4,160 $ 13,247 $ 12,407 MedSurg and Neurotechnology $ 626 $ 663 $ 1,838 $ 2,000 Orthopaedics and Spine 519 500 1,648 1,518 Segment operating income $ 1,145 $ 1,163 $ 3,486 $ 3,518 Items not allocated to segments: Corporate and other $ (144) $ (105) $ (488) $ (421) Acquisition and integration-related costs 78 (126) (108) (495) Amortization of intangible assets (159) (144) (469) (474) Restructuring-related and other charges (58) (178) (229) (209) Medical device regulations (38) (27) (98) (72) Recall-related matters 4 (16) (14) (98) Regulatory and legal matters (20) 7 (53) 16 Consolidated operating income $ 808 $ 574 $ 2,027 $ 1,765 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Sales Analysis (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 4,479 | $ 4,160 | $ 13,247 | $ 12,407 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 3,360 | 3,019 | 9,776 | 8,903 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,119 | 1,141 | 3,471 | 3,504 |
MedSurg and Neurotechnology: | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,588 | 2,349 | 7,560 | 6,899 |
MedSurg and Neurotechnology: | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,985 | 1,754 | 5,713 | 5,070 |
MedSurg and Neurotechnology: | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 603 | 595 | 1,847 | 1,829 |
MedSurg and Neurotechnology: | Instruments | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 535 | 525 | 1,626 | 1,511 |
MedSurg and Neurotechnology: | Instruments | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 425 | 415 | 1,290 | 1,171 |
MedSurg and Neurotechnology: | Instruments | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 110 | 110 | 336 | 340 |
MedSurg and Neurotechnology: | Endoscopy | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 590 | 525 | 1,728 | 1,512 |
MedSurg and Neurotechnology: | Endoscopy | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 480 | 418 | 1,371 | 1,179 |
MedSurg and Neurotechnology: | Endoscopy | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 110 | 107 | 357 | 333 |
MedSurg and Neurotechnology: | Medical | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 765 | 636 | 2,095 | 1,898 |
MedSurg and Neurotechnology: | Medical | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 625 | 496 | 1,686 | 1,457 |
MedSurg and Neurotechnology: | Medical | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 140 | 140 | 409 | 441 |
MedSurg and Neurotechnology: | Neurovascular | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 294 | 295 | 901 | 885 |
MedSurg and Neurotechnology: | Neurovascular | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 110 | 113 | 333 | 339 |
MedSurg and Neurotechnology: | Neurovascular | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 184 | 182 | 568 | 546 |
MedSurg and Neurotechnology: | Neuro Cranial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 332 | 299 | 992 | 890 |
MedSurg and Neurotechnology: | Neuro Cranial | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 274 | 244 | 819 | 724 |
MedSurg and Neurotechnology: | Neuro Cranial | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 58 | 55 | 173 | 166 |
MedSurg and Neurotechnology: | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 72 | 69 | 218 | 203 |
MedSurg and Neurotechnology: | Other | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 71 | 68 | 214 | 200 |
MedSurg and Neurotechnology: | Other | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1 | 1 | 4 | 3 |
Orthopaedics and Spine: | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,891 | 1,811 | 5,687 | 5,508 |
Orthopaedics and Spine: | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,375 | 1,265 | 4,063 | 3,833 |
Orthopaedics and Spine: | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 516 | 546 | 1,624 | 1,675 |
Orthopaedics and Spine: | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 111 | 123 | 322 | 373 |
Orthopaedics and Spine: | Other | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 85 | 97 | 243 | 290 |
Orthopaedics and Spine: | Other | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 26 | 26 | 79 | 83 |
Orthopaedics and Spine: | Knees | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 481 | 439 | 1,445 | 1,325 |
Orthopaedics and Spine: | Knees | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 365 | 321 | 1,078 | 964 |
Orthopaedics and Spine: | Knees | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 116 | 118 | 367 | 361 |
Orthopaedics and Spine: | Hips | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 347 | 328 | 1,038 | 990 |
Orthopaedics and Spine: | Hips | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 225 | 199 | 657 | 606 |
Orthopaedics and Spine: | Hips | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 122 | 129 | 381 | 384 |
Orthopaedics and Spine: | Trauma and Extremities | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 672 | 639 | 2,033 | 1,953 |
Orthopaedics and Spine: | Trauma and Extremities | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 494 | 447 | 1,470 | 1,362 |
Orthopaedics and Spine: | Trauma and Extremities | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 178 | 192 | 563 | 591 |
Orthopaedics and Spine: | Spine | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 280 | 282 | 849 | 867 |
Orthopaedics and Spine: | Spine | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 206 | 201 | 615 | 611 |
Orthopaedics and Spine: | Spine | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 74 | $ 81 | $ 234 | $ 256 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Revenue Recognition [Abstract] | ||
Contract liabilities | $ 661 | $ 529 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive (Loss) Income (AOCI) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period | $ (286) | $ (943) | $ (531) | $ (1,157) |
OCI | 334 | 83 | 727 | 314 |
Income taxes | (123) | 45 | (252) | 22 |
Cost of sales | 1,697 | 1,518 | 4,905 | 4,484 |
Other (income) expense, net | 8 | (79) | (105) | (241) |
Income taxes | 0 | (57) | (127) | (192) |
Net OCI | 197 | 127 | 442 | 341 |
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period | (89) | (816) | (89) | (816) |
Reclassification out of Accumulated Other Comprehensive Income | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Cost of sales | (7) | 4 | (10) | 9 |
Other (income) expense, net | (7) | (6) | (27) | (6) |
Income taxes | 0 | 1 | 4 | 2 |
Net OCI | 197 | 127 | 442 | 341 |
Marketable Securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period | (1) | (3) | 0 | (3) |
OCI | 0 | 4 | (1) | 4 |
Income taxes | 0 | 0 | 0 | 0 |
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period | (1) | 0 | (1) | 0 |
Marketable Securities | Reclassification out of Accumulated Other Comprehensive Income | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Cost of sales | 0 | 0 | 0 | 0 |
Other (income) expense, net | 0 | 0 | 0 | 0 |
Income taxes | 0 | (1) | 0 | (1) |
Net OCI | 0 | 3 | (1) | 3 |
Pension Plans | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period | (148) | (256) | (155) | (259) |
OCI | 11 | 2 | 15 | 1 |
Income taxes | (3) | 0 | (3) | (2) |
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period | (138) | (251) | (138) | (251) |
Pension Plans | Reclassification out of Accumulated Other Comprehensive Income | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Cost of sales | 0 | 0 | 0 | 0 |
Other (income) expense, net | 3 | 4 | 7 | 12 |
Income taxes | (1) | (1) | (2) | (3) |
Net OCI | 10 | 5 | 17 | 8 |
Hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period | 65 | 26 | 40 | (10) |
OCI | 19 | 6 | 55 | 40 |
Income taxes | (1) | (2) | (7) | (13) |
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period | 73 | 33 | 73 | 33 |
Hedges | Reclassification out of Accumulated Other Comprehensive Income | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Cost of sales | (7) | 4 | (10) | 9 |
Other (income) expense, net | (2) | (2) | (4) | 7 |
Income taxes | (1) | 1 | (1) | 0 |
Net OCI | 8 | 7 | 33 | 43 |
Financial Statement Translation | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period | (202) | (710) | (416) | (885) |
OCI | 304 | 71 | 658 | 269 |
Income taxes | (119) | 47 | (242) | 37 |
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period | (23) | (598) | (23) | (598) |
Financial Statement Translation | Reclassification out of Accumulated Other Comprehensive Income | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Cost of sales | 0 | 0 | 0 | 0 |
Other (income) expense, net | (8) | (8) | (30) | (25) |
Income taxes | 2 | 2 | 7 | 6 |
Net OCI | $ 179 | $ 112 | $ 393 | $ 287 |
Derivative Instruments (Forward
Derivative Instruments (Forward Currency Exchange Contracts) (Details) - Foreign Exchange Contract € in Millions, $ in Millions | 6 Months Ended | 9 Months Ended | |||
Jun. 30, 2022 | Sep. 30, 2022 USD ($) | Sep. 30, 2022 EUR (€) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | |
Derivative [Line Items] | |||||
Notional Amount | $ 5,508 | $ 8,751 | |||
Maximum term in years | 4 years 10 months 24 days | 4 years 1 month 6 days | |||
Derivative, Fair Value, Net | $ 355 | 195 | |||
Other current assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 185 | 146 | |||
Other noncurrent assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 188 | 66 | |||
Other current liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | (17) | (17) | |||
Other noncurrent liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | (1) | ||||
Net Investment | |||||
Derivative [Line Items] | |||||
Notional Amount | € | € 4,400 | € 4,400 | |||
Non-Designated | |||||
Derivative [Line Items] | |||||
Notional Amount | 3,137 | 5,512 | |||
Derivative, Fair Value, Net | 130 | 82 | |||
Non-Designated | Other current assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 140 | 92 | |||
Non-Designated | Other noncurrent assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 0 | 0 | |||
Non-Designated | Other current liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | (10) | (10) | |||
Non-Designated | Other noncurrent liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | 0 | ||||
Cash Flow | Net Investment | |||||
Derivative [Line Items] | |||||
Notional Amount | 923 | 973 | |||
Derivative, Fair Value, Net | 40 | 9 | |||
Cash Flow | Net Investment | Other current assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 45 | 15 | |||
Cash Flow | Net Investment | Other noncurrent assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 3 | 1 | |||
Cash Flow | Net Investment | Other current liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | (7) | (7) | |||
Cash Flow | Net Investment | Other noncurrent liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | (1) | ||||
Net Investment | Net Investment | |||||
Derivative [Line Items] | |||||
Notional Amount | 1,448 | 2,266 | |||
Derivative, Fair Value, Net | 185 | 104 | |||
Net Investment | Net Investment | Other current assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 0 | 39 | |||
Net Investment | Net Investment | Other noncurrent assets | |||||
Derivative [Line Items] | |||||
Derivative assets | 185 | 65 | |||
Net Investment | Net Investment | Other current liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | 0 | $ 0 | |||
Net Investment | Net Investment | Other noncurrent liabilities | |||||
Derivative [Line Items] | |||||
Derivative liabilities | $ 0 |
Derivative Instruments (Narrati
Derivative Instruments (Narrative) (Details) $ in Millions | 9 Months Ended | ||||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 EUR (€) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | |
Proceeds from settlement of net investment hedges | $ 197 | $ 0 | |||
Foreign Exchange Contract | |||||
Notional amount | 5,508 | $ 8,751 | |||
Designated as Hedging Instrument | Foreign Exchange Contract | |||||
Derivative, notional amount | € | € 1,500,000,000 | € 2,000,000,000 | |||
Notional amount | € | € 4,400,000,000 | € 4,400,000,000 | |||
Derivative, fair value | 603 | ||||
Cash flow hedge gain (loss) to be reclassified within twelve months | 50 | ||||
Net investment hedges expected to be reclassified to cost of sales and other income (expense) | 34 | ||||
Designated as Hedging Instrument | Interest Rate Swap | |||||
Cash flow hedge gain (loss) to be reclassified within twelve months | $ 5 |
Derivative Instruments (Income
Derivative Instruments (Income Statement Location) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Foreign Exchange Contract | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net currency exchange rate gains (losses) | $ 14 | $ (1) | $ 42 | $ 10 |
Foreign Exchange Contract | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net currency exchange rate gains (losses) | 7 | (4) | 10 | (9) |
Foreign Exchange Contract | Other income (expense), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net currency exchange rate gains (losses) | (1) | (5) | 2 | (6) |
Net Investment | Other income (expense), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net currency exchange rate gains (losses) | $ 8 | $ 8 | $ 30 | $ 25 |
Fair Value Measurements (Valuat
Fair Value Measurements (Valuation Of Financial Instruments By Pricing Categories) (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | $ 1,420 | $ 2,944 |
Assets | ||
Available-for-sale securities, current | 77 | 75 |
Investments Fair Value Disclosure | 2,025 | 3,424 |
Contingent consideration: | ||
Total liabilities measured at fair value | 296 | 516 |
Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 1,420 | 2,944 |
Trading marketable securities | 155 | 193 |
Assets | ||
Investments Fair Value Disclosure | 1,575 | 3,137 |
Deferred compensation arrangements | 155 | 193 |
Contingent consideration: | ||
Total liabilities measured at fair value | 155 | 193 |
Fair Value, Inputs, Level 2 | ||
Assets | ||
Available-for-sale securities, current | 77 | 75 |
Investments Fair Value Disclosure | 450 | 287 |
Contingent consideration: | ||
Total liabilities measured at fair value | 18 | 17 |
Fair Value, Inputs, Level 2 | Foreign currency exchange forward contracts | ||
Assets | ||
Derivative asset | 373 | 212 |
Liabilities | ||
Foreign currency exchange forward contracts | 18 | 17 |
Fair Value, Inputs, Level 2 | Corporate and asset-backed debt securities | ||
Assets | ||
Available-for-sale securities, current | 43 | 48 |
Fair Value, Inputs, Level 2 | Foreign government | ||
Assets | ||
Available-for-sale securities, current | 1 | 2 |
Fair Value, Inputs, Level 2 | United States agency debt securities | ||
Assets | ||
Available-for-sale securities, current | 2 | 5 |
Fair Value, Inputs, Level 2 | United States Treasury debt securities | ||
Assets | ||
Available-for-sale securities, current | 30 | 19 |
Fair Value, Inputs, Level 2 | Certificates of deposit | ||
Assets | ||
Available-for-sale securities, current | 1 | 1 |
Fair Value, Inputs, Level 3 | ||
Contingent consideration: | ||
Beginning | 306 | 393 |
Additions | 1 | 62 |
Change in estimate | (137) | (1) |
Settlements | (47) | (148) |
Ending | 123 | 306 |
Total liabilities measured at fair value | $ 123 | $ 306 |
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 ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value Disclosures [Abstract] | ||
Due in one year or less | $ 50 | $ 36 |
Due after one year through three years | $ 27 | $ 39 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | ||||
Reduction of contingent consideration | $ 110 | |||
Gain on sale of marketable securities | $ 26 | $ 15 | $ 61 | $ 50 |
Contingencies and Commitments_2
Contingencies and Commitments (Narrative) (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Loss Contingencies [Line Items] | |||||
Recall-related payments | $ (26) | $ (180) | |||
Recall charges | $ (4) | $ 16 | 14 | $ 98 | |
PureWick | |||||
Loss Contingencies [Line Items] | |||||
Charges during period | $ 28 | ||||
Estimate of possible loss | 100 | 100 | |||
Minimum | |||||
Loss Contingencies [Line Items] | |||||
Estimate of possible loss | 375 | 375 | |||
Maximum | |||||
Loss Contingencies [Line Items] | |||||
Estimate of possible loss | $ 510 | $ 510 |
Contingencies and Commitments -
Contingencies and Commitments - Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |||||
Right-of-use assets | $ 456 | $ 456 | $ 419 | ||
Lease liabilities, current | 116 | 116 | 112 | ||
Lease liabilities, non-current | $ 349 | $ 349 | $ 310 | ||
Other information: | |||||
Weighted-average remaining lease term | 5 years 6 months | 5 years 6 months | 5 years 4 months 24 days | ||
Weighted-average discount rate | 3.09% | 3.09% | 2.86% | ||
Operating lease cost | $ 37 | $ 35 | $ 110 | $ 102 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |
Feb. 28, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Business Acquisition [Line Items] | ||||
Aggregate purchase price of acquisitions | $ 2,563 | $ 267 | ||
Payments of long-term debt | $ 502 | $ 1,151 | ||
Vocera | ||||
Business Acquisition [Line Items] | ||||
Aggregate purchase price of acquisitions | $ 2,600 | |||
Consideration transferred (in dollars per share) | $ 79.25 | |||
Business combination, consideration transferred, including convertible notes | $ 3,000 | |||
Share-based payment expense | $ 132 | |||
Vocera | 1.50% Convertible Notes | ||||
Business Acquisition [Line Items] | ||||
Stated interest rate | 1.50% | 1.50% | ||
Payments of long-term debt | $ 101 | |||
Vocera | 0.50% Convertible Notes | ||||
Business Acquisition [Line Items] | ||||
Stated interest rate | 0.50% | 0.50% | ||
Payments of long-term debt | $ 324 |
Acquisitions (Allocation Of The
Acquisitions (Allocation Of The Preliminary Purchase Price To The Acquired Net Assets (Details) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended | |
Feb. 28, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Goodwill | $ 14,993 | $ 12,918 | |
Vocera | |||
Accounts receivable | 33 | ||
Inventory | 13 | ||
Deferred income tax assets | 73 | ||
Other assets | 92 | ||
Debt | (425) | ||
Deferred income tax liabilities | (182) | ||
Other liabilities | (115) | ||
Goodwill | 2,328 | ||
Purchase price, net of cash acquired of $281 | $ 2,563 | ||
Weighted-average life of intangible assets | 13 years | ||
Cash acquired from acquisition | $ 281 | ||
Vocera | Customer and distributor relationships | |||
Intangible assets acquired | $ 550 | ||
Vocera | Developed technology and patents | |||
Intangible assets acquired | 178 | ||
Vocera | Trade name | |||
Intangible assets acquired | $ 18 |
Acquisitions (Future Amortizati
Acquisitions (Future Amortization Expense) (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Business Combinations [Abstract] | |
Remainder of 2022 | $ 159 |
2023 | 617 |
2024 | 587 |
2025 | 567 |
2026 | $ 510 |
Debt and Credit Facilities (Det
Debt and Credit Facilities (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Jun. 30, 2022 | Feb. 28, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Commercial paper | $ 0 | |||
Borrowings outstanding under credit facility | 0 | |||
Other Long-term Debt | 8,000,000 | $ 10,000,000 | ||
Total debt | 12,759,000,000 | 12,479,000,000 | ||
Less current maturities of debt | 8,000,000 | 7,000,000 | ||
Total long-term debt | 12,751,000,000 | 12,472,000,000 | ||
Unamortized debt issuance costs | 55,000,000 | 62,000,000 | ||
Borrowing capacity on existing facilities | 2,162,000,000 | 2,162,000,000 | ||
Fair value of senior unsecured notes | $ 10,401,000,000 | 13,391,000,000 | ||
Term Loan | ||||
Debt instrument, face amount | $ 1,500,000,000 | |||
Repayments of debt | $ 500,000,000 | |||
Maturity Date | Feb. 22, 2025 | |||
Long-term Debt | $ 1,000,000,000 | 0 | ||
Term Loan | SOFR | ||||
Basis spread on variable rate (as a percent) | 0.725% | |||
Credit Agreement | Revolving Credit Facility | ||||
Line of credit facility, maximum borrowing capacity | $ 2,250,000,000 | 1,500,000,000 | ||
Senior Unsecured Notes 1.125% due 2021 | ||||
Stated interest rate | 1.125% | |||
Maturity Date | Nov. 30, 2023 | |||
Unsecured Debt | $ 530,000,000 | 622,000,000 | ||
Senior Unsecured Notes, 0.600% Due 2023 | ||||
Stated interest rate | 0.60% | |||
Maturity Date | Dec. 01, 2023 | |||
Unsecured Debt | $ 599,000,000 | 598,000,000 | ||
Senior Unsecured Notes 3.375% due 2024 | ||||
Stated interest rate | 3.375% | |||
Maturity Date | May 15, 2024 | |||
Unsecured Debt | $ 595,000,000 | 593,000,000 | ||
Senior Unsecured Notes, 0.250% Due 2024 | ||||
Stated interest rate | 0.25% | |||
Maturity Date | Dec. 03, 2024 | |||
Unsecured Debt | $ 817,000,000 | 958,000,000 | ||
Senior Unsecured Notes, 1.150% Due 2025 | ||||
Stated interest rate | 1.15% | |||
Maturity Date | Jun. 15, 2025 | |||
Unsecured Debt | $ 647,000,000 | 645,000,000 | ||
Senior Unsecured Notes 3.375% due 2025 | ||||
Stated interest rate | 3.375% | |||
Maturity Date | Nov. 01, 2025 | |||
Unsecured Debt | $ 748,000,000 | 748,000,000 | ||
Senior Unsecured Notes 3.50% due 2026 | ||||
Stated interest rate | 3.50% | |||
Maturity Date | Mar. 15, 2026 | |||
Unsecured Debt | $ 995,000,000 | 994,000,000 | ||
Senior Unsecured Notes 2.125% due 2027 | ||||
Stated interest rate | 2.125% | |||
Maturity Date | Nov. 30, 2027 | |||
Unsecured Debt | $ 720,000,000 | 845,000,000 | ||
Senior Unsecured Notes 3.650% due 2028 | ||||
Stated interest rate | 3.65% | |||
Maturity Date | Mar. 07, 2028 | |||
Unsecured Debt | $ 597,000,000 | 597,000,000 | ||
Senior Unsecured Notes, 0.750% Due 2029 | ||||
Stated interest rate | 0.75% | |||
Maturity Date | Mar. 01, 2029 | |||
Unsecured Debt | $ 767,000,000 | 901,000,000 | ||
Senior Unsecured Notes, 1.950% Due 2030 | ||||
Stated interest rate | 1.95% | |||
Maturity Date | Jun. 15, 2030 | |||
Unsecured Debt | $ 991,000,000 | 990,000,000 | ||
Senior Unsecured Notes 2.625% due 2030 | ||||
Stated interest rate | 2.625% | |||
Maturity Date | Nov. 30, 2030 | |||
Unsecured Debt | $ 619,000,000 | 727,000,000 | ||
Senior Unsecured Notes, 1.000% Due 2031 | ||||
Stated interest rate | 1% | |||
Maturity Date | Dec. 03, 2031 | |||
Unsecured Debt | $ 715,000,000 | 840,000,000 | ||
Senior Unsecured Notes 4.100% due 2043 | ||||
Stated interest rate | 4.10% | |||
Maturity Date | Apr. 01, 2043 | |||
Unsecured Debt | $ 392,000,000 | 392,000,000 | ||
Senior Unsecured Notes 4.375% due 2044 | ||||
Stated interest rate | 4.375% | |||
Maturity Date | May 15, 2044 | |||
Unsecured Debt | $ 395,000,000 | 395,000,000 | ||
Senior Unsecured Notes 4.625% due 2046 | ||||
Stated interest rate | 4.625% | |||
Maturity Date | Mar. 15, 2046 | |||
Unsecured Debt | $ 982,000,000 | 982,000,000 | ||
Senior Unsecured Notes, 2.900% due 2050 | ||||
Stated interest rate | 2.90% | |||
Maturity Date | Jun. 15, 2050 | |||
Unsecured Debt | $ 642,000,000 | $ 642,000,000 | ||
Commercial Paper | ||||
Debt instrument, maturity | 397 days |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax [Abstract] | ||||
Effective income tax rate reconciliation, percent | 0% | 11.50% | 6.60% | 12.60% |
Tax settlement amount | $ 162 | |||
Tax settlement, release of accrued interest | $ 50 |
Segment Information (Sales And
Segment Information (Sales And Other Financial Information By Business Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 4,479 | $ 4,160 | $ 13,247 | $ 12,407 |
Segment operating income | 808 | 574 | 2,027 | 1,765 |
Amortization of intangible assets | (159) | (144) | (469) | (474) |
Recall-related matters | 4 | (16) | (14) | (98) |
MedSurg and Neurotechnology: | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 2,588 | 2,349 | 7,560 | 6,899 |
Orthopaedics and Spine: | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,891 | 1,811 | 5,687 | 5,508 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment operating income | 1,145 | 1,163 | 3,486 | 3,518 |
Operating Segments | MedSurg and Neurotechnology: | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 2,588 | 2,349 | 7,560 | 6,899 |
Segment operating income | 626 | 663 | 1,838 | 2,000 |
Operating Segments | Orthopaedics and Spine: | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,891 | 1,811 | 5,687 | 5,508 |
Segment operating income | 519 | 500 | 1,648 | 1,518 |
Corporate and other | ||||
Segment Reporting Information [Line Items] | ||||
Segment operating income | (144) | (105) | (488) | (421) |
Segment Reconciling Items | ||||
Segment Reporting Information [Line Items] | ||||
Acquisition and integration-related costs | 78 | (126) | (108) | (495) |
Amortization of intangible assets | (159) | (144) | (469) | (474) |
Restructuring-related and other charges | (58) | (178) | (229) | (209) |
Medical device regulations | (38) | (27) | (98) | (72) |
Recall-related matters | 4 | (16) | (14) | (98) |
Regulatory and legal matters | $ (20) | $ 7 | $ (53) | $ 16 |
Asset Impairments (Details)
Asset Impairments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Concentration Risk [Line Items] | ||||
Asset impairments | $ 105 | $ 18 | $ 119 | |
Revenue Benchmark | Geographic Concentration Risk | CHINA | ||||
Concentration Risk [Line Items] | ||||
Concentration risk (as a percent) | 2.50% |