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Revenue Recognition
 6 Months Ended
Jun. 30, 2025
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 2024.
We disaggregate our net sales by business 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.
In the first quarter 2025 we changed the name of our
Neurovascular business to Vascular due the acquisition of Inari
Medical, Inc. (Inari).
In the fourth quarter 2024 we reorganized our Spine business to
align with certain updates to our internal reporting structure. The
spine enabling technologies portfolio (Enabling Technologies)
was reclassified to Other Orthopaedics and Spine, the
interventional spine (IVS) portfolio was reclassified to Neuro
Cranial and the remaining Spine business was renamed to Spinal
Implants. In addition we changed the name of our “Orthopaedics
and Spine” operating segment to “Orthopaedics.” Neuro Cranial
includes sales related to IVS of $129 and $98 for the three
months 2025 and 2024 and $247 and $196 for the six months
2025 and 2024. Other Orthopaedics includes sales related to
Enabling Technologies of $34 and $31 for the three months 2025
and 2024 and $63 and $62 for the six months 2025 and 2024.
We have reflected these changes in all historical periods
presented.
Net Sales by Business
Three Months
Six Months
2025
2024
2025
2024
MedSurg and Neurotechnology:
Instruments
$768
$698
$1,498
$1,365
Endoscopy
899
768
1,766
1,546
Medical
990
908
1,935
1,772
Vascular
498
327
904
637
Neuro Cranial
616
514
1,179
992
$3,771
$3,215
$7,282
$6,312
Orthopaedics:
Knees
$640
$602
$1,279
$1,190
Hips
466
428
909
821
Trauma and Extremities
957
832
1,902
1,662
Spinal Implants
5
178
171
349
Other
183
167
345
331
$2,251
$2,207
$4,606
$4,353
Total
$6,022
$5,422
$11,888
$10,665
Net Sales by Geography
Three Months 2025
Three Months 2024
United
States
International
United
States
International
MedSurg and Neurotechnology:
Instruments
$621
$147
$564
$134
Endoscopy
742
157
623
145
Medical
840
150
763
145
Vascular
268
230
127
200
Neuro Cranial
507
109
418
96
$2,978
$793
$2,495
$720
Orthopaedics:
Knees
$460
$180
$433
$169
Hips
283
183
261
167
Trauma and Extremities
702
255
610
222
Spinal Implants
—
5
124
54
Other
131
52
124
43
$1,576
$675
$1,552
$655
Total
$4,554
$1,468
$4,047
$1,375
Net Sales by Geography
Six Months 2025
Six Months 2024
United
States
International
United
States
International
MedSurg and Neurotechnology:
Instruments
$1,208
$290
$1,096
$269
Endoscopy
1,452
314
1,259
287
Medical
1,642
293
1,478
294
Vascular
471
433
248
389
Neuro Cranial
972
207
808
184
$5,745
$1,537
$4,889
$1,423
Orthopaedics:
Knees
$924
$355
$862
$328
Hips
552
357
512
309
Trauma and Extremities
1,415
487
1,221
441
Spinal Implants
118
53
241
108
Other
240
105
236
95
$3,249
$1,357
$3,072
$1,281
Total
$8,994
$2,894
$7,961
$2,704
Costs to Obtain or Fulfill a Contract
We typically do not incur costs to fulfill a contract before a
product or service is provided to a customer due to the nature of
our products and services. Our costs to obtain contracts are
typically in the form of sales commissions paid to employees or
third-party agents. Certain sales commissions paid to employees
prior to recognition of sales are recorded as deferred contract
costs. We expense sales commissions associated with obtaining
a contract at the time of the sale or as incurred as the
amortization period is generally less than one year. These costs
have been presented within selling, general and administrative
expenses. On June 30, 2025 and December 31, 2024 deferred
contracts costs recorded in our Consolidated Balance Sheets
were not significant.
Contract Assets and Liabilities
Our contract assets primarily relate to conditional rights to
consideration for work completed but not billed at the reporting
date. On June 30, 2025 and December 31, 2024 contract assets
recorded in our Consolidated Balance Sheets were not
significant.
Our contract liabilities arise as a result of consideration received
from customers at inception of contracts for certain businesses or
where the timing of billing for services precedes satisfaction of
our performance obligations. This occurs primarily when payment
is received upfront for certain multi-period extended service
contracts. Our contract liabilities of $1,061 and $978 on June 30,
2025 and December 31, 2024 are classified within accrued
expenses and other liabilities and other noncurrent liabilities in
our Consolidated Balance Sheets based on the timing of when
we expect to complete our performance obligations.
Changes in contract liabilities during the six months 2025 were as
follows:
June 30
2025
Beginning contract liabilities
$978
Revenue recognized from beginning of year contract liabilities
(348)
Net advance consideration received during the period
431
Ending contract liabilities
$1,061
Transfers and Servicing of Financial Assets
We sell certain customer lease agreements and the related
leased assets to third-party financial institutions to accelerate our
cash collection cycle. The lease receivables are sold without
recourse and are derecognized from our Consolidated Balance
Sheets at the time of sale. Under the terms of our arrangements,
we collect lease payments on behalf of the financial institutions
but maintain no other form of continuing involvement. Sales of
these lease agreements are classified as operating activities in
our Consolidated Statements of Cash Flows. Fees earned for our
servicing activities are immaterial. Revenue related to customer
lease agreements sold under these arrangements represented
less than 4% of our total revenue for the three and six months
2025 and 2024.