Retirement Benefit Plans (Tables)
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12 Months Ended |
Apr. 28, 2023 |
Retirement Benefits [Abstract] |
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Schedule of Defined Benefit Plans |
The change in benefit obligation and funded status of the Company’s U.S. and Non-U.S. pension benefits are as follows: | | | | | | | | | | | | | | | | | | | | | | | | | U.S. Pension Benefits(2) | | Non-U.S. Pension Benefits | | Fiscal Year | | Fiscal Year | (in millions) | 2023 | | 2022 | | 2023 | | 2022 | Accumulated benefit obligation at end of year: | $ | 3,348 | | | $ | 3,396 | | | $ | 1,422 | | | $ | 1,638 | | Change in projected benefit obligation: | | | | | | | | Projected benefit obligation at beginning of year | $ | 3,526 | | | $ | 3,979 | | | $ | 1,740 | | | $ | 2,294 | | Service cost | 77 | | | 98 | | | 43 | | | 64 | | Interest cost | 142 | | | 102 | | | 38 | | | 26 | | Employee contributions | — | | | — | | | 9 | | | 12 | | Plan curtailments, settlements, and amendments | (19) | | | — | | | (8) | | | (11) | | Actuarial (gain) loss(1) | (210) | | | (513) | | | (303) | | | (394) | | Benefits paid | (140) | | | (141) | | | (63) | | | (48) | | Special termination benefits(3) | 74 | | | — | | | — | | | — | | Currency exchange rate changes and other | — | | | — | | | 43 | | | (203) | | Projected benefit obligation at end of year | $ | 3,451 | | | $ | 3,526 | | | $ | 1,499 | | | $ | 1,740 | | Change in plan assets: | | | | | | | | Fair value of plan assets at beginning of year | $ | 3,559 | | | $ | 3,660 | | | $ | 1,732 | | | $ | 1,900 | | Actual return on plan assets | (43) | | | 15 | | | (163) | | | (12) | | Employer contributions | 22 | | | 24 | | | 57 | | | 70 | | Employee contributions | — | | | — | | | 9 | | | 12 | | Plan settlements | — | | | — | | | (8) | | | (1) | | Benefits paid | (140) | | | (141) | | | (63) | | | (48) | | Currency exchange rate changes and other | — | | | — | | | 50 | | | (188) | | Fair value of plan assets at end of year | $ | 3,398 | | | $ | 3,559 | | | $ | 1,614 | | | $ | 1,732 | | Funded status at end of year: | | | | | | | | Fair value of plan assets | $ | 3,398 | | | $ | 3,559 | | | $ | 1,614 | | | $ | 1,732 | | Benefit obligations | 3,451 | | | 3,526 | | | 1,499 | | | 1,740 | | Over (under) funded status of the plans | (53) | | | 33 | | | 115 | | | (8) | | Recognized asset (liability) | $ | (53) | | | $ | 33 | | | $ | 115 | | | $ | (8) | | Amounts recognized on the consolidated balance sheets consist of: | Non-current assets | $ | 221 | | | $ | 313 | | | $ | 350 | | | $ | 240 | | Current liabilities | (24) | | | (21) | | | (6) | | | (6) | | Non-current liabilities | (250) | | | (259) | | | (228) | | | (242) | | Recognized asset (liability) | $ | (53) | | | $ | 33 | | | $ | 115 | | | $ | (8) | | Amounts recognized in accumulated other comprehensive loss: | Prior service cost (credit) | $ | (19) | | | $ | — | | | $ | (3) | | | $ | (4) | | Net actuarial loss | 891 | | | 854 | | | 76 | | | 161 | | Ending balance | $ | 873 | | | $ | 854 | | | $ | 73 | | | $ | 157 | |
(1)Actuarial gains and losses result from changes in actuarial assumptions (such as changes in the discount rate and revised mortality rates). The actuarial gain in fiscal year 2023 and 2022 was primarily related to increases in discount rates. (2)As of April 24, 2020, the Company announced the freezing of the U.S. pension benefits beginning Plan year 2028. Employees will continue to earn benefits as required by the Medtronic Retirement Plan until April 30, 2027, after which date benefits will no longer be earned and employees will earn benefits through the Medtronic Savings and Investment Plan. (3)This represents a portion of the total voluntary early retirement package charges for fiscal year 2023.
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Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets |
U.S. and non-U.S. pension plans with accumulated benefit obligations in excess of plan assets consist of the following: | | | | | | | | | | | | | Fiscal Year | (in millions) | 2023 | | 2022 | Accumulated benefit obligation | $ | 731 | | | $ | 830 | | Projected benefit obligation | 772 | | | 880 | | Plan assets at fair value | 301 | | | 356 | |
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Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets |
U.S. and non-U.S. pension plans with projected benefit obligations in excess of plan assets consist of the following: | | | | | | | | | | | | | Fiscal Year | (in millions) | 2023 | | 2022 | Projected benefit obligation | $ | 1,285 | | | $ | 907 | | Plan assets at fair value | 776 | | | 379 | |
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Schedule of Net Benefit Costs |
The net periodic benefit cost of the plans includes the following components: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | U.S. Pension Benefits | | Non-U.S. Pension Benefits | | Fiscal Year | | Fiscal Year | (in millions) | 2023 | | 2022 | | 2021 | | 2023 | | 2022 | | 2021 | Service cost | $ | 77 | | | $ | 98 | | | $ | 106 | | | $ | 43 | | | $ | 64 | | | $ | 70 | | Interest cost | 142 | | | 102 | | | 109 | | | 38 | | | 26 | | | 28 | | Expected return on plan assets | (224) | | | (226) | | | (242) | | | (58) | | | (64) | | | (59) | | Amortization of prior service cost | — | | | — | | | 1 | | | (1) | | | (1) | | | (1) | | Amortization of net actuarial loss | 20 | | | 64 | | | 69 | | | 2 | | | 22 | | | 25 | | Settlement and curtailment (gain) loss | — | | | — | | | — | | | 2 | | | (10) | | | 1 | | Special termination benefits | 74 | | | — | | | 73 | | | — | | | — | | | — | | Net periodic benefit cost | $ | 89 | | | $ | 39 | | | $ | 116 | | | $ | 26 | | | $ | 37 | | | $ | 64 | |
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Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) |
The other changes in plan assets and projected benefit obligations recognized in other comprehensive income for fiscal year 2023 are as follows: | | | | | | | | | | | | (in millions) | U.S. Pension Benefits | | Non-U.S. Pension Benefits | Net actuarial loss (gain) | $ | 58 | | | $ | (82) | | Prior service cost (credit) | (19) | | | — | | Amortization of prior service credit | — | | | 1 | | Amortization and settlement recognition of actuarial loss | (20) | | | (4) | | Effect of exchange rates | — | | | 3 | | Total recognized in other comprehensive income | 19 | | | (82) | | Total recognized in net periodic benefit cost and other comprehensive income | $ | 108 | | | $ | (57) | |
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Schedule of Assumptions Used |
The actuarial assumptions are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | U.S. Pension Benefits | | Non-U.S. Pension Benefits | | Fiscal Year | | Fiscal Year | | 2023 | | 2022 | | 2021 | | 2023 | | 2022 | | 2021 | Critical assumptions – projected benefit obligation: | | | | | | | | | | | | Discount rate | 4.73% - 4.99% | | 4.23% - 4.48% | | 2.80% - 3.50% | | 1.30% - 10.70% | | 0.60% - 25.40% | | 0.30% - 13.30% | Rate of compensation increase | 3.90 | % | | 4.83 | % | | 4.83 | % | | 2.75 | % | | 2.70 | % | | 2.90 | % | Critical assumptions – net periodic benefit cost: | | | | | | | | | | | | Discount rate – benefit obligation | 4.23% - 4.48% | | 2.80% - 3.46% | | 3.10% - 3.70% | | 0.60% - 25.40% | | 0.25% - 12.80% | | 0.30% - 13.90% | Discount rate – service cost | 4.12% - 4.51% | | 2.50% - 3.51% | | 2.60% - 3.90% | | 0.60% - 25.40% | | 0.24% - 12.80% | | 0.30% - 13.90% | Discount rate – interest cost | 3.90% - 4.23% | | 2.08% - 2.87% | | 2.80% - 3.20% | | 0.60% - 25.40% | | 0.08% - 12.80% | | 0.30% - 13.90% | Expected return on plan assets | 5.30% - 7.20% | | 5.60% - 7.40% | | 7.50 | % | | 3.48 | % | | 3.67 | % | | 3.78 | % | Rate of compensation increase | 3.90 | % | | 3.90% - 4.83% | | 3.90 | % | | 2.70 | % | | 2.90 | % | | 2.91 | % |
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Schedule of Allocation of Plan Assets |
The Company’s U.S. plans target asset allocations at April 28, 2023, compared to the U.S. plans actual asset allocations at April 28, 2023 and April 29, 2022 by asset category, are as follows: | | | | | | | | | | | | | | | | | | U.S. Plans | Target Allocation | | Actual Allocation | | April 28, 2023 | | April 28, 2023 | | April 29, 2022 | Asset Category: | | | | | | Equity securities | 34 | % | | 36 | % | | 36 | % | Debt securities | 51 | | | 46 | | | 45 | | Other | 15 | | | 19 | | | 19 | | Total | 100 | % | | 100 | % | | 100 | % |
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Schedule of Fair Value Measurements, Retirement Benefit Plan Assets |
The following tables provide information by level for the retirement benefit plan assets that are measured at fair value, as defined by U.S. GAAP. Certain investments for which the fair value is measured using the net asset value per share (or its equivalent) practical expedient are not presented within the fair value hierarchy. The fair value amounts presented for these investments are intended to permit reconciliation to the total fair value of plan assets at April 28, 2023 and April 29, 2022. U.S. Pension Benefits | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value at | | | | | | Fair Value Measurements Using Inputs Considered as | | Investments Measured at Net Asset Value | (in millions) | April 28, 2023 | Level 1 | | Level 2 | | Level 3 | | Short-term investments | $ | 114 | | | $ | 114 | | | $ | — | | | $ | — | | | $ | — | | Mutual funds | 114 | | | 114 | | | — | | | — | | | — | | Equity commingled trusts | 1,211 | | | — | | | — | | | — | | | 1,211 | | Fixed income commingled trusts | 968 | | | — | | | — | | | — | | | 968 | | Partnership units | 992 | | | — | | | — | | | 992 | | | — | | | $ | 3,398 | | | $ | 227 | | | $ | — | | | $ | 992 | | | $ | 2,179 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value at | | Fair Value Measurements Using Inputs Considered as | | Investments Measured at Net Asset Value | (in millions) | April 29, 2022 | Level 1 | | Level 2 | | Level 3 | | Short-term investments | $ | 73 | | | $ | 73 | | | $ | — | | | $ | — | | | $ | — | | Mutual funds | 125 | | | 125 | | | — | | | — | | | — | | Equity commingled trusts | 1,281 | | | — | | | — | | | — | | | 1,281 | | Fixed income commingled trusts | 1,069 | | | — | | | — | | | — | | | 1,069 | | Partnership units | 1,011 | | | — | | | — | | | 1,011 | | | — | | | $ | 3,559 | | | $ | 197 | | | $ | — | | | $ | 1,011 | | | $ | 2,350 | |
Non-U.S. Pension Benefits | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value at | | Fair Value Measurements Using Inputs Considered as | | Investments Measured at Net Asset Value | (in millions) | April 28, 2023 | Level 1 | | Level 2 | | Level 3 | | Registered investment companies | $ | 1,571 | | | $ | — | | | $ | — | | | $ | — | | | $ | 1,571 | | Insurance contracts | 44 | | | — | | | — | | | 44 | | | — | | | $ | 1,614 | | | $ | — | | | $ | — | | | $ | 44 | | | $ | 1,571 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value at | | Fair Value Measurements Using Inputs Considered as | | Investments Measured at Net Asset Value | (in millions) | April 29, 2022 | Level 1 | | Level 2 | | Level 3 | | Registered investment companies | $ | 1,689 | | | $ | — | | | $ | — | | | $ | — | | | $ | 1,689 | | Insurance contracts | 43 | | | — | | | — | | | 43 | | | — | | | $ | 1,732 | | | $ | — | | | $ | — | | | $ | 43 | | | $ | 1,689 | |
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Schedule of Retirement Benefit Plan Assets, Unobservable Input Reconciliation |
The following tables provide a reconciliation of the beginning and ending balances of U.S. pension benefit assets measured at fair value that used significant unobservable inputs (Level 3): | | | | | | (in millions) | Partnership Units | April 30, 2021 | $ | 860 | | Total realized gains, net | 28 | | Total unrealized gains, net | 72 | | Purchases and sales, net | 51 | | April 29, 2022 | 1,011 | | Total realized gains, net | 67 | | Total unrealized gains, net | 151 | | Purchases and sales, net | (238) | | April 28, 2023 | $ | 992 | |
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Schedule of Expected Benefit Payments |
Retiree benefit payments, which reflect expected future service, are anticipated to be paid as follows: | | | | | | | | | | | | (in millions) | Gross Payments | Fiscal Year | U.S. Pension Benefits | | Non-U.S. Pension Benefits | 2024 | $ | 168 | | | $ | 64 | | 2025 | 178 | | | 62 | | 2026 | 188 | | | 62 | | 2027 | 200 | | | 68 | | 2028 | 213 | | | 69 | | 2029 – 2033 | 1,171 | | | 411 | | | | | |
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