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Retirement Plans
 12 Months Ended
Dec. 31, 2024
Retirement Benefits [Abstract]  
Retirement Plans RETIREMENT PLANS
Defined Contribution Plans
We provide certain employees with defined contribution plans and other types of retirement 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 our Consolidated Statements of Cash Flows.
202420232022
Plan expense$376 $327 $305 
Expense funded with Stryker common stock62 57 41 
Stryker common stock held by plan:
Dollar amount$781 $649 $522 
Shares (in millions)2.2 2.2 2.1 
Value as a percentage of total plan assets10 %10 %10 %
Defined Benefit Plans
Certain of our subsidiaries have both funded and unfunded defined benefit pension plans covering some or all of their employees. The majority of our defined benefit pension plans have projected benefit obligations in excess of plan assets.
Discount Rate
The discount rates were selected using a hypothetical portfolio of high quality bonds on December 31 that would provide the necessary cash flows to match our projected benefit payments.
Expected Return on Plan Assets
The expected return on plan assets is determined by applying the target allocation in each asset category of plan investments to the anticipated return for each asset category based on historical and projected returns.
Components of Net Periodic Pension Cost
Net periodic benefit cost:202420232022
Service cost$(39)$(32)$(56)
Interest cost(21)(23)(10)
Expected return on plan assets19 18 15 
Amortization of prior service credit1 1 1 
Recognized actuarial gain (loss)(1)4 (9)
Net periodic benefit cost$(41)$(32)$(59)
Changes in assets and benefit obligations recognized in OCI:
Net actuarial gain (loss)$43 $(67)$244 
Recognized net actuarial (gain) loss1 (4)9 
Prior service credit and transition amount(1)(1)(1)
Total recognized in other comprehensive income (loss)$43 $(72)$252 
Total recognized in net periodic benefit cost and OCI$2 $(104)$193 
Weighted-average rates used to determine net periodic benefit cost:
Discount rate2.8 %3.3 %1.1 %
Expected return on plan assets4.3 %4.2 %3.1 %
Rate of compensation increase3.0 %3.0 %2.6 %
Weighted-average discount rate used to determine projected benefit obligations2.9 %2.8 %3.3 %
The actuarial gain (loss) for all pension plans was primarily related to a change in the discount rate used to measure the benefit obligations of those plans.
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.
20242023
Fair value of plan assets$492 $485 
Benefit obligations(782)(826)
Funded status$(290)$(341)
Reported as:
Noncurrent assets—other assets$48 $21 
Current liabilities—accrued compensation(3)(3)
Noncurrent liabilities—other liabilities(335)(359)
Pre-tax amounts recognized in AOCI:
Unrecognized net actuarial gain (loss)6 (39)
Unrecognized prior service credit8 11 
Total$14 $(28)
Change in Benefit Obligations
20242023
Beginning projected benefit obligations$826 $673 
Service cost39 32 
Interest cost21 23 
Foreign exchange impact(52)32 
Employee contributions7 7 
Actuarial (gains) losses(40)79 
Benefits paid(19)(20)
Ending projected benefit obligations$782 $826 
Ending accumulated benefit obligations$748 $790 
Change in Plan Assets
20242023
Beginning fair value of plan assets$485 $420 
Actual return22 29 
Employer contributions23 23 
Employee contributions7 7 
Foreign exchange impact(31)22 
Benefits paid(14)(16)
Ending fair value of plan assets$492 $485 
Allocation of Plan Assets
2025 Target2024 Actual2023 Actual
Equity securities24 %28 %28 %
Debt securities44 40 37 
Other32 32 35 
Total100 %100 %100 %
Valuation of Plan Assets
2024Level 1Level 2Level 3Total
Cash and cash equivalents$17 $— $— $17 
Equity securities8 125 — 133 
Debt securities2 203 — 205 
Other4 76 57 137 
Total$31 $404 $57 $492 
2023Level 1Level 2Level 3Total
Cash and cash equivalents$15 $— $— $15 
Equity securities20 130 — 150 
Debt securities2 185 — 187 
Other5 63 65 133 
Total$42 $378 $65 $485 
Our Level 3 pension plan assets primarily include guaranteed investment contracts with insurance companies. The insurance contracts guarantee us principal repayment and a fixed rate of return. The $8 decrease in Level 3 pension plan assets is primarily driven by the change in the corresponding pension liability. We expect to contribute $21 to our defined benefit pension plans in 2025.
Estimated Future Benefit Payments
202520262027202820292030-2034
$24 $23 $25 $26 $27 $171