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Segment Reporting | 3 Months Ended
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Mar. 31, 2025
Segment Reporting [Abstract] |
SEGMENT REPORTING | NOTE J – SEGMENT REPORTING We aggregate our core businesses into two reportable segments: MedSurg and Cardiovascular, each of which generates revenues from the sale of medical devices. In accordance with FASB ASC Topic 280, Segment Reporting, we identified our reportable segments based on the nature of our products, production processes, type of customer, selling and distribution methods and regulatory environment, as well as the economic characteristics of each of our operating segments. Our chief operating decision maker (CODM) is our President and Chief Executive Officer. We measure and evaluate our reportable segments based on their respective net sales, cost of goods sold, selling, general and administrative expenses, research and development expenses, operating income, excluding intersegment profits, and operating income as a percentage of net sales, all based on internally-derived standard currency exchange rates to exclude the impact of foreign currency, which may be updated from year to year. We exclude from segment expenses and segment operating income certain corporate-related expenses and certain transactions or adjustments that our CODM considers to be non-operational, such as amounts related to amortization expense, goodwill and other intangible asset impairment charges, acquisition/divestiture-related net charges (credits), restructuring and restructuring-related net charges (credits), certain litigation-related net charges (credits) and European Union (EU) Medical Device Regulation (MDR) implementation costs. Although we exclude these amounts from segment expenses and segment operating income they are included in reported Income (loss) before income taxes within our accompanying unaudited consolidated statements of operations and are included in the reconciliation below. The CODM uses segment operating income in the budget and forecasting process and to monitor budget versus actual results, which are used in assessing the performance of the reportable segments and to allocate resources across our reportable segments Refer to Note K – Revenue for net sales by reportable segment presented in accordance with GAAP. A reconciliation of sales and operating income for the reportable segments to the applicable line items within our accompanying unaudited consolidated statements of operations is as follows (in millions, except percentages). Prior period amounts have been restated at constant currency to conform to current year presentation.
| Three Months Ended March 31, 2025
| MedSurg | % of net sales | Cardiovascular | % of net sales | Total
Net sales of reportable segments | $ | 1,598 |  |  | $ | 3,133 |  |  | $ | 4,731 |
Impact of foreign currency fluctuations |  |  |  |  | (69) |
Total net sales |  |  |  |  | 4,663 |
Segment expenses: |  |  |  |  |
Cost of products sold | 435 |  | 27.2 | % | 925 |  | 29.5 | % | 1,360 |
Selling, general and administrative expenses | 509 |  | 31.8 | % | 867 |  | 27.7 | % | 1,376 |
Research and development expenses | 121 |  | 7.5 | % | 282 |  | 9.0 | % | 403 |
Other segment items(1) | 6 |  | 0.3 | % | 6 |  | 0.2 | % | 11 |
Segment operating income(2) | 528 |  | 33.1 | % | 1,053 |  | 33.6 | % | 1,582 |
Unallocated amounts: |  |  |  |  |
Corporate expenses, including hedging activities and impact of foreign currency fluctuations on operating income of reportable segments |  |  |  |  | (232) |
Goodwill and other intangible asset impairment charges, acquisition/divestiture-related net charges (credits), restructuring and restructuring-related net charges (credits), certain litigation-related net charges (credits) and EU MDR implementation costs |  |  |  |  | (209) |
Amortization expense |  |  |  |  | (219) |
Operating income (loss) |  |  |  |  | 921 |
Other income (expense), net |  |  |  |  | (116) |
Income (loss) before income taxes |  |  |  |  | $ | 805 |
| Three Months Ended March 31, 2024
| MedSurg | % of net sales | Cardiovascular | % of net sales | Total
Net sales of reportable segments | $ | 1,417 |  |  | $ | 2,458 |  |  | $ | 3,875 |
Impact of foreign currency fluctuations |  |  |  |  | (19) |
Total net sales |  |  |  |  | 3,856 |
Segment expenses: |  |  |  |  |
Cost of products sold | 381 |  | 26.9 | % | 811 |  | 33.0 | % | 1,192 |
Selling, general and administrative expenses | 439 |  | 31.0 | % | 740 |  | 30.1 | % | 1,180 |
Research and development expenses | 107 |  | 7.6 | % | 228 |  | 9.3 | % | 335 |
Other segment items(1) | 5 |  | 0.3 | % | 4 |  | 0.2 | % | 9 |
Segment operating income(2) | 485 |  | 34.2 | % | 674 |  | 27.4 | % | 1,159 |
Unallocated amounts: |  |  |  |  |
Corporate expenses, including hedging activities and impact of foreign currency fluctuations on operating income of reportable segments |  |  |  |  | (146) |
Goodwill and other intangible asset impairment charges, acquisition/divestiture-related net charges (credits), restructuring and restructuring-related net charges (credits), certain litigation-related net charges (credits) and EU MDR implementation costs |  |  |  |  | (124) |
Amortization expense |  |  |  |  | (214) |
Operating income (loss) |  |  |  |  | 675 |
Other income (expense), net |  |  |  |  | (67) |
Income (loss) before income taxes |  |  |  |  | $ | 608 |
(1) Includes royalty expense. (2) Calculated as Net sales of reportable segments less Segment expenses.
| Three Months Ended March 31,
Depreciation expense (in millions) | 2025 |  | 2024
MedSurg | $ | 27 |  |  | $ | 24 |
Cardiovascular | 78 |  |  | 66 |
Consolidated depreciation expense | $ | 106 |  |  | $ | 90 |
| As of
Total assets (in millions) | March 31, 2025 |  | December 31, 2024
MedSurg | $ | 3,127 |  |  | $ | 3,093 |
Cardiovascular | 7,413 |  |  | 7,084 |
Total assets of reportable segments | 10,540 |  |  | 10,177 |
Goodwill | 17,340 |  |  | 17,089 |
Other intangible assets, net | 6,566 |  |  | 6,684 |
All other corporate assets | 5,695 |  |  | 5,446 |
| $ | 40,140 |  |  | $ | 39,395 |
| As of
Long-lived assets (in millions) | March 31, 2025 |  | December 31, 2024 |  |
U.S. | $ | 1,522 |  |  | $ | 1,461 |  |  |
Ireland | 655 |  |  | 631 |  |  |
Costa Rica | 557 |  |  | 530 |  |  |
Other countries | 654 |  |  | 672 |  |  |
Property, plant and equipment, net | 3,389 |  |  | 3,294 |  |  |
Goodwill | 17,340 |  |  | 17,089 |  |  |
Other intangible assets, net | 6,566 |  |  | 6,684 |  |  |
Operating lease right-of-use assets in Other long-term assets | 448 |  |  | 449 |  |  |
| $ | 27,743 |  |  | $ | 27,516 |  |  |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482810/280-10-50-21 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name 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