Segment and Geographic Area Information

12 Months Ended

Dec. 31, 2021

Segment Information

Segment and Geographic Area Information

Note 15 — Segment and Geographic Area Information

Abbott’s principal business is the discovery, development, manufacture and sale of a broad line of health care products. Abbott’s products are generally sold directly to retailers, wholesalers, hospitals, health care facilities, laboratories, physicians’ offices and government agencies throughout the world.

Abbott’s reportable segments are as follows:

Established Pharmaceutical Products—International sales of a broad line of branded generic pharmaceutical products.

Nutritional Products—Worldwide sales of a broad line of adult and pediatric nutritional products.

Diagnostic Products—Worldwide sales of diagnostic systems and tests for blood banks, hospitals, commercial laboratories and alternate-care testing sites. For segment reporting purposes, the Core Laboratories Diagnostics, Rapid Diagnostics, Molecular Diagnostics and Point of Care divisions are aggregated and reported as the Diagnostic Products segment.

Medical Devices — Worldwide sales of rhythm management, electrophysiology, heart failure, vascular, structural heart, neuromodulation and diabetes care products. For segment reporting purposes, the Cardiac Rhythm Management, Electrophysiology and Heart Failure, Vascular, Neuromodulation, Structural Heart and Diabetes Care divisions are aggregated and reported as the Medical Devices segment.

Abbott’s underlying accounting records are maintained on a legal entity basis for government and public reporting requirements. Segment disclosures are on a performance basis consistent with internal management reporting. The cost of some corporate functions and the cost of certain employee benefits are charged to segments at predetermined rates that approximate cost. Remaining costs, if any, are not allocated to segments. In addition, intangible asset amortization is not allocated to operating segments, and intangible assets and goodwill are not included in the measure of each segment’s assets.

The following segment information has been prepared in accordance with the internal accounting policies of Abbott, as described above, and are not presented in accordance with generally accepted accounting principles applied to the consolidated financial statements.

	Net Sales to External Customers (a)						Operating Earnings (a)
(in millions)	2021		2020		2019		2021		2020		2019
Established Pharmaceutical Products	$	4,718	$	4,303	$	4,486	$	889	$	794	$	904
Nutritional Products		8,294		7,647		7,409		1,763		1,751		1,705
Diagnostic Products		15,644		10,805		7,713		6,256		3,725		1,912
Medical Devices		14,367		11,787		12,239		4,514		3,038		3,769
Total Reportable Segments		43,023		34,542		31,487	$	13,422	$	9,308	$	8,290
Other		52		66		57
Total	$	43,075	$	34,608	$	31,904

(a) In 2021, the impact of foreign exchange favorably impacted net sales and unfavorably impacted operating earnings. In 2020 and 2019, the impact of foreign exchange unfavorably impacted net sales and operating earnings.

Note 15 — Segment and Geographic Area Information (Continued)

(in millions)	2021		2020		2019
Total Reportable Segment Operating Earnings	$	13,422	$	9,308	$	8,290
Corporate functions and benefit plan costs		(801)		(518)		(468)
Net interest expense		(490)		(500)		(576)
Loss on extinguishment of debt		—		—		(63)
Share-based compensation		(640)		(546)		(519)
Amortization of intangible assets		(2,047)		(2,132)		(1,936)
Other, net (b)		(1,233)		(644)		(651)
Earnings from Continuing Operations Before Taxes	$	8,211	$	4,968	$	4,077

(b) Other, net includes integration costs associated with the acquisition of St. Jude Medical and Alere and restructuring charges in 2021, 2020 and 2019. 2021 restructuring charges include Abbott’s restructuring plan for its COVID-19 test manufacturing network. Other, net for 2021 also includes costs related to certain litigation. Other, net in 2020 also includes costs related to asset impairments, partially offset by income from the settlement of litigation. Charges for restructuring actions and other cost reduction initiatives were approximately $375 million in 2021, $125 million in 2020 and $215 million in 2019.

							Additions to
	Depreciation						Property and Equipment						Total Assets
(in millions)	2021		2020		2019		2021		2020		2019		2021		2020		2019
Established Pharmaceuticals	$	94	$	88	$	98	$	169	$	109	$	109	$	2,789	$	2,888	$	2,858
Nutritionals		151		143		139		174		201		141		3,425		3,478		3,274
Diagnostics		760		488		403		980		1,263		726		7,699		7,696		5,235
Medical Devices		285		281		266		348		402		532		7,261		6,893		6,640
Total Reportable Segments		1,290		1,000		906		1,671		1,975		1,508	$	21,174	$	20,955	$	18,007
Other		201		195		172		201		218		160
Total	$	1,491	$	1,195	$	1,078	$	1,872	$	2,193	$	1,668

(in millions)	2021		2020
Total Reportable Segment Assets	$	21,174	$	20,955
Cash and investments		11,065		7,969
Goodwill and intangible assets		35,970		38,528
All other (c)		6,987		5,096
Total Assets	$	75,196	$	72,548

(c) All other includes the long-term assets associated with the defined benefit plans of $2.27 billion in 2021 and $824 million in 2020.

Note 15 — Segment and Geographic Area Information (Continued)

	Net Sales to External
	Customers (d)
(in millions)	2021		2020		2019
United States	$	16,642	$	13,022	$	11,398
Germany		2,572		2,108		1,751
China		2,392		1,965		2,346
Japan		1,695		1,386		1,435
India		1,561		1,323		1,397
Canada		1,385		841		573
Switzerland		1,313		1,140		1,068
All Other Countries		15,515		12,823		11,936
Consolidated	$	43,075	$	34,608	$	31,904

(d)Sales by country are based on the country that sold the product.

Long-lived assets on a geographic basis primarily include property and equipment. It excludes goodwill, intangible assets, deferred tax assets, and financial instruments. At December 31, 2021 and 2020, long-lived assets totaled $13.1 billion and $11.7 billion, respectively, and in the United States such assets totaled $6.8 billion and $6.1 billion, respectively. Long-lived asset balances associated with other countries were not material on an individual country basis in either of the two years.