10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

⌧ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

◻ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                   to                  

Commission File No. 1-2189

ABBOTT LABORATORIES

An Illinois Corporation	I.R.S. Employer Identification No.
	36-0698440

100 Abbott Park Road

Abbott Park, Illinois 60064-6400

Telephone:  (224) 667-6100

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Shares, Without Par Value	ABT	New York Stock Exchange Chicago Stock Exchange, Inc.

Indicate by check mark whether the registrant: (l) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of l934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☒	Accelerated Filer ☐
Non-Accelerated Filer ☐	Smaller reporting company ☐
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of March 31, 2022, Abbott Laboratories had 1,750,942,289 common shares without par value outstanding.

Abbott Laboratories

Table of Contents

Part I - Financial Information
	Page
Item 1. Financial Statements and Supplementary Data
Condensed Consolidated Statement of Earnings	3
Condensed Consolidated Statement of Comprehensive Income	4
Condensed Consolidated Balance Sheet	5
Condensed Consolidated Statement of Shareholders’ Investment	6
Condensed Consolidated Statement of Cash Flows	7
Notes to the Condensed Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 4. Controls and Procedures	24
Part II - Other Information
Item 1. Legal Proceedings	24
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 6. Exhibits	26
Signature	27

2

Abbott Laboratories and Subsidiaries

Condensed Consolidated Statement of Earnings

(Unaudited)

(dollars in millions except per share data; shares in thousands)

	Three Months Ended
	March 31
	2022		2021
Net sales	$	11,895	$	10,456
Cost of products sold, excluding amortization of intangible assets		4,987		4,401
Amortization of intangible assets		512		509
Research and development		697		654
Selling, general and administrative		2,787		2,783
Total operating cost and expenses		8,983		8,347
Operating earnings		2,912		2,109
Interest expense		131		135
Interest (income)		(14)		(11)
Net foreign exchange (gain) loss		(3)		3
Other (income) expense, net		(78)		(61)
Earnings before taxes		2,876		2,043
Taxes on earnings		429		250
Net Earnings	$	2,447	$	1,793
Basic Earnings Per Common Share	$	1.38	$	1.00
Diluted Earnings Per Common Share	$	1.37	$	1.00
Average Number of Common Shares Outstanding Used for Basic Earnings Per Common Share		1,761,911		1,776,842
Dilutive Common Stock Options		12,631		14,661
Average Number of Common Shares Outstanding Plus Dilutive Common Stock Options		1,774,542		1,791,503
Outstanding Common Stock Options Having No Dilutive Effect		2,655		2,694

The accompanying notes to the condensed consolidated financial statements are an integral part of this statement.

3

Abbott Laboratories and Subsidiaries

Condensed Consolidated Statement of Comprehensive Income

(Unaudited)

(dollars in millions)

	Three Months Ended
	March 31
	2022		2021
Net Earnings	$	2,447	$	1,793
Foreign currency translation gain (loss) adjustments		(106)		(536)
Net actuarial gains (losses) and amortization of net actuarial (losses) and prior service (costs) and credits, net of taxes of $13 in 2022 and $18 in 2021		62		85
Net gains (losses) for derivative instruments designated as cash flow hedges, net of taxes of $(15) in 2022 and $46 in 2021		(56)		112
Other comprehensive income (loss)		(100)		(339)
Comprehensive Income (Loss)	$	2,347	$	1,454
	March 31,		December 31,
	2022		2021
Supplemental Accumulated Other Comprehensive Income (Loss) Information, net of tax:
Cumulative foreign currency translation (loss) adjustments	$	(5,945)	$	(5,839)
Net actuarial (losses) and prior service (costs) and credits		(2,608)		(2,670)
Cumulative gains (losses) on derivative instruments designated as cash flow hedges		79		135
Accumulated Other Comprehensive Income (Loss)	$	(8,474)	$	(8,374)

The accompanying notes to the condensed consolidated financial statements are an integral part of this statement.

4

Abbott Laboratories and Subsidiaries

Condensed Consolidated Balance Sheet

(Unaudited)

(dollars in millions)

	March 31,		December 31,
	2022		2021
Assets
Current Assets:
Cash and cash equivalents	$	7,675	$	9,799
Short-term investments		483		450
Trade receivables, less allowances of $640 in 2022 and $519 in 2021		7,179		6,487
Inventories:
Finished products		3,470		3,081
Work in process		695		694
Materials		1,526		1,382
Total inventories		5,691		5,157
Prepaid expenses and other receivables		2,401		2,346
Total Current Assets		23,429		24,239
Investments		763		816
Property and equipment, at cost		19,521		19,364
Less: accumulated depreciation and amortization		10,613		10,405
Net property and equipment		8,908		8,959
Intangible assets, net of amortization		12,225		12,739
Goodwill		23,179		23,231
Deferred income taxes and other assets		5,503		5,212
	$	74,007	$	75,196

Liabilities and Shareholders’ Investment
Current Liabilities:
Trade accounts payable	$	4,757	$	4,408
Salaries, wages and commissions		1,147		1,625
Other accrued liabilities		5,577		5,181
Dividends payable		824		831
Income taxes payable		338		306
Current portion of long-term debt		4		754
Total Current Liabilities		12,647		13,105
Long-term debt		17,086		17,296
Post-employment obligations, deferred income taxes and other long-term liabilities		8,645		8,771
Commitments and Contingencies
Shareholders’ Investment:
Preferred shares, one dollar par value Authorized — 1,000,000 shares, none issued		—		—
Common shares, without par value Authorized — 2,400,000,000 shares Issued at stated capital amount — Shares: 2022: 1,985,525,053; 2021: 1,985,273,421		24,304		24,470
Common shares held in treasury, at cost — Shares: 2022: 234,582,764; 2021: 221,191,228		(13,726)		(11,822)
Earnings employed in the business		33,295		31,528
Accumulated other comprehensive income (loss)		(8,474)		(8,374)
Total Abbott Shareholders’ Investment		35,399		35,802
Noncontrolling Interests in Subsidiaries		230		222
Total Shareholders’ Investment		35,629		36,024
	$	74,007	$	75,196

The accompanying notes to the condensed consolidated financial statements are an integral part of this statement.

5

Abbott Laboratories and Subsidiaries

Condensed Consolidated Statement of Shareholders’ Investment

(Unaudited)

(in millions except shares and per share data)

	Three Months Ended March 31
	2022		2021
Common Shares:
Balance at January 1
Shares: 2022: 1,985,273,421; 2021: 1,981,156,896	$	24,470	$	24,145
Issued under incentive stock programs
Shares: 2022: 251,632; 2021: 1,048,595		14		47
Share-based compensation		324		304
Issuance of restricted stock awards		(504)		(473)
Balance at March 31
Shares: 2022: 1,985,525,053; 2021: 1,982,205,491	$	24,304	$	24,023
Common Shares Held in Treasury:
Balance at January 1
Shares: 2022: 221,191,228; 2021: 209,926,622	$	(11,822)	$	(10,042)
Issued under incentive stock programs
Shares: 2022: 4,144,476; 2021: 4,818,787		223		231
Purchased
Shares: 2022: 17,536,012; 2021: 277,508		(2,127)		(34)
Balance at March 31
Shares: 2022: 234,582,764; 2021: 205,385,343	$	(13,726)	$	(9,845)
Earnings Employed in the Business:
Balance at January 1	$	31,528	$	27,627
Net earnings		2,447		1,793
Cash dividends declared on common shares (per share — 2022: $0.47; 2021: $0.45)		(826)		(803)
Effect of common and treasury share transactions		146		52
Balance at March 31	$	33,295	$	28,669
Accumulated Other Comprehensive Income (Loss):
Balance at January 1	$	(8,374)	$	(8,946)
Other comprehensive income (loss)		(100)		(339)
Balance at March 31	$	(8,474)	$	(9,285)
Noncontrolling Interests in Subsidiaries:
Balance at January 1	$	222	$	219
Noncontrolling Interests’ share of income, business combinations, net of distributions and share repurchases		8		7
Balance at March 31	$	230	$	226

The accompanying notes to condensed consolidated financial statements are an integral part of this statement.

6

Abbott Laboratories and Subsidiaries

Condensed Consolidated Statement of Cash Flows

(Unaudited)

(dollars in millions)

	Three Months Ended March 31
	2022		2021
Cash Flow From (Used in) Operating Activities:
Net earnings	$	2,447	$	1,793
Adjustments to reconcile net earnings to net cash from operating activities —
Depreciation		311		425
Amortization of intangible assets		512		509
Share-based compensation		305		288
Trade receivables		(751)		165
Inventories		(554)		(537)
Other, net		(205)		(6)
Net Cash From Operating Activities		2,065		2,637
Cash Flow From (Used in) Investing Activities:
Acquisitions of property and equipment		(321)		(397)
Acquisitions of businesses and technologies, net of cash acquired		—		(15)
Sales (purchases) of other investment securities, net		(41)		(14)
Other		2		4
Net Cash (Used in) Investing Activities		(360)		(422)
Cash Flow From (Used in) Financing Activities:
Net borrowings (repayments) of short-term debt and other		8		24
Repayments of long-term debt		(751)		(2)
Purchases of common shares		(2,307)		(275)
Proceeds from stock options exercised		59		86
Dividends paid		(832)		(800)
Net Cash (Used in) Financing Activities		(3,823)		(967)
Effect of exchange rate changes on cash and cash equivalents		(6)		(32)
Net Increase (Decrease) in Cash and Cash Equivalents		(2,124)		1,216
Cash and Cash Equivalents, Beginning of Year		9,799		6,838
Cash and Cash Equivalents, End of Period	$	7,675	$	8,054

The accompanying notes to the condensed consolidated financial statements are an integral part of this statement.

7

Abbott Laboratories and Subsidiaries

Notes to the Condensed Consolidated Financial Statements

March 31, 2022

(Unaudited)

Note 1 — Basis of Presentation

The accompanying unaudited, condensed consolidated financial statements have been prepared pursuant to rules and regulations of the Securities and Exchange Commission and, therefore, do not include all information and footnote disclosures normally included in audited financial statements. However, in the opinion of management, all adjustments (which include only normal adjustments) necessary to present fairly the results of operations, financial position and cash flows have been made. It is suggested that these statements be read in conjunction with the financial statements included in Abbott’s Annual Report on Form 10-K for the year ended December 31, 2021. The condensed consolidated financial statements include the accounts of the parent company and subsidiaries, after elimination of intercompany transactions.

Note 2 — Revenue

Abbott’s revenues are derived primarily from the sale of a broad line of health care products under short-term receivable arrangements. Abbott has four reportable segments: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices.

The following table provides detail by sales category:

	Three Months Ended March 31, 2022						Three Months Ended March 31, 2021
(in millions)	U.S.		Int’l		Total		U.S.		Int’l		Total
Established Pharmaceutical Products —
Key Emerging Markets	$	—	$	902	$	902	$	—	$	821	$	821
Other		—		245		245		—		249		249
Total		—		1,147		1,147		—		1,070		1,070
Nutritionals —
Pediatric Nutritionals		338		509		847		508		558		1,066
Adult Nutritionals		339		708		1,047		328		642		970
Total		677		1,217		1,894		836		1,200		2,036
Diagnostics —
Core Laboratory		268		916		1,184		271		911		1,182
Molecular		172		248		420		175		272		447
Point of Care		91		37		128		92		37		129
Rapid Diagnostics		2,210		1,344		3,554		1,103		1,153		2,256
Total		2,741		2,545		5,286		1,641		2,373		4,014
Medical Devices —
Rhythm Management		248		276		524		241		278		519
Electrophysiology		216		269		485		179		252		431
Heart Failure		167		54		221		145		49		194
Vascular		209		410		619		219		416		635
Structural Heart		190		221		411		169		208		377
Neuromodulation		143		36		179		145		39		184
Diabetes Care		343		783		1,126		253		727		980
Total		1,516		2,049		3,565		1,351		1,969		3,320
Other		3		—		3		10		6		16
Total	$	4,937	$	6,958	$	11,895	$	3,838	$	6,618	$	10,456

8

Note 2 — Revenue (Continued)

Remaining Performance Obligations

As of March 31, 2022, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) was approximately $3.8 billion in the Diagnostics segment and approximately $428 million in the Medical Devices segment. Abbott expects to recognize revenue on approximately 60 percent of these remaining performance obligations over the next 24 months, approximately 16 percent over the subsequent 12 months and the remainder thereafter.

These performance obligations primarily reflect the future sale of reagents/consumables in contracts with minimum purchase obligations, extended warranty or service obligations related to previously sold equipment, and remote monitoring services related to previously implanted devices. Abbott has applied the practical expedient described in Accounting Standards Codification (ASC) 606-10-50-14 and has not included remaining performance obligations related to contracts with original expected durations of one year or less in the amounts above.

Other Contract Assets and Liabilities

Abbott discloses Trade receivables separately in the Condensed Consolidated Balance Sheet at the net amount expected to be collected. Contract assets primarily relate to Abbott’s conditional right to consideration for work completed but not billed at the reporting date. Contract assets at the beginning and end of the period, as well as the changes in the balance, were not significant.

Contract liabilities primarily relate to payments received from customers in advance of performance under the contract. Abbott’s contract liabilities arise primarily in the Medical Devices reportable segment when payment is received upfront for various multi-period extended service arrangements.

Changes in the contract liabilities during the period are as follows:

(in millions)
Contract Liabilities:
Balance at December 31, 2021	$	520
Unearned revenue from cash received during the period		171
Revenue recognized related to contract liability balance		(178)
Balance at March 31, 2022	$	513

Note 3 — Supplemental Financial Information

Shares of unvested restricted stock that contain non-forfeitable rights to dividends are treated as participating securities and are included in the computation of earnings per share under the two-class method. Under the two-class method, net earnings are allocated between common shares and participating securities. Net earnings allocated to common shares for the three months ended March 31, 2022 and 2021 were $2.438 billion and $1.785 billion, respectively.

Other, net in Net cash from operating activities in the Condensed Consolidated Statement of Cash Flows for the first three months of 2022 includes $334 million of pension contributions and the payment of cash taxes of approximately $195 million. The first three months of 2021 includes $16 million of pension contributions and the payment of cash taxes of approximately $270 million.

9

Note 3 — Supplemental Financial Information (Continued)

The following summarizes the activity for the first three months of 2022 related to the allowance for doubtful accounts as of March 31, 2022:

(in millions)
Allowance for Doubtful Accounts:
Balance at December 31, 2021	$	313
Provisions/charges to income		3
Amounts charged off and other deductions		(15)
Balance at March 31, 2022	$	301

The allowance for doubtful accounts reflects the current estimate of credit losses expected to be incurred over the life of the accounts receivable. Abbott considers various factors in establishing, monitoring, and adjusting its allowance for doubtful accounts, including the aging of the accounts and aging trends, the historical level of charge-offs, and specific exposures related to particular customers. Abbott also monitors other risk factors and forward-looking information, such as country risk, when determining credit limits for customers and establishing adequate allowances.

The components of long-term investments as of March 31, 2022 and December 31, 2021 are as follows:

	March 31,		December 31,
(in millions)	2022		2021
Long-term Investments:
Equity securities	$	703	$	748
Other		60		68
Total	$	763	$	816

The decrease in Abbott’s long-term investments as of March 31, 2022 versus the balance as of December 31, 2021 primarily relates to a decrease in the value of investments held in a rabbi trust.

Abbott’s equity securities as of March 31, 2022, include $357 million of investments in mutual funds that are held in a rabbi trust and were acquired as part of the St. Jude Medical, Inc. (St. Jude Medical) business acquisition. These investments, which are specifically designated as available for the purpose of paying benefits under a deferred compensation plan, are not available for general corporate purposes and are subject to creditor claims in the event of insolvency.

Abbott also holds certain investments as of March 31, 2022 with a carrying value of $244 million that are accounted for under the equity method of accounting and other equity investments with a carrying value of $92 million that do not have a readily determinable fair value.

10

Note 4 — Changes in Accumulated Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss), net of income taxes, are as follows:

	Three Months Ended March 31
									Cumulative Gains (Losses)
	Cumulative Foreign				Net Actuarial (Losses) and				on Derivative Instruments
	Currency Translation				Prior Service (Costs) and				Designated as Cash Flow
	Adjustments				Credits				Hedges
(in millions)	2022		2021		2022		2021		2022		2021
Balance at January 1	$	(5,839)	$	(4,859)	$	(2,670)	$	(3,871)	$	135	$	(216)
Other comprehensive income (loss) before reclassifications		(106)		(536)		17		22		(34)		96
Amounts reclassified from accumulated other comprehensive income		—		—		45		63		(22)		16
Net current period comprehensive income (loss)		(106)		(536)		62		85		(56)		112
Balance at March 31	$	(5,945)	$	(5,395)	$	(2,608)	$	(3,786)	$	79	$	(104)

(Income) loss amounts reclassified from accumulated other comprehensive income related to cash flow hedges are recorded as Cost of products sold. Net actuarial losses and prior service cost are included as a component of net periodic benefit costs; see Note 11 for additional details.

Note 5 — Goodwill and Intangible Assets

The total amount of goodwill reported was $23.2 billion at March 31, 2022 and December 31, 2021. Foreign currency translation adjustments decreased goodwill by approximately $50 million in the first three months of 2022. The amount of goodwill related to reportable segments at March 31, 2022 was $2.8 billion for the Established Pharmaceutical Products segment, $286 million for the Nutritional Products segment, $3.7 billion for the Diagnostic Products segment, and $16.4 billion for the Medical Devices segment. There was no reduction of goodwill relating to impairments in the first three months of 2022.

The gross amount of amortizable intangible assets, primarily product rights and technology, was $27.7 billion as of March 31, 2022 and December 31, 2021 and accumulated amortization was $16.4 billion as of March 31, 2022 and $15.9 billion as of December 31, 2021. Foreign currency translation adjustments increased intangible assets by $3 million in the first three months of 2022. Abbott’s estimated annual amortization expense for intangible assets is approximately $2.1 billion in 2022, $2.0 billion in 2023, $1.9 billion in 2024, $1.7 billion in 2025 and $1.6 billion in 2026.

Indefinite-lived intangible assets, which relate to in-process R&D (IPR&D) acquired in a business combination, were approximately $919 million as of March 31, 2022 and December 31, 2021.

11

Note 6 — Restructuring Plans

On May 27, 2021, Abbott management approved a restructuring plan related to its Diagnostic Products segment to align its manufacturing network for COVID-19 diagnostic tests with changes in the second quarter in projected testing demand driven by several factors, including significant reductions in cases in the U.S. and other major developed countries, the accelerated rollout of COVID-19 vaccines globally and the U.S. health authority’s updated guidance on testing for fully vaccinated individuals. In the second quarter of 2021, Abbott recorded charges of $499 million under this plan in Cost of products sold. The charge recognized in the second quarter included fixed asset write-downs of $80 million, inventory-related charges of $248 million, and other exit costs, which included contract cancellations and employee-related costs of $171 million.

In the second half of 2021, as the Delta and Omicron variants of COVID-19 spread and the number of new COVID-19 cases increased significantly, particularly in the U.S., demand for rapid COVID-19 tests increased significantly. As a result, in the second half of 2021, Abbott sold approximately $181 million of inventory that was previously estimated to have no net realizable value under the second quarter of 2021 restructuring action. In addition, the estimate of other exit costs was reduced by a net $58 million as Abbott fulfilled its purchase obligations under certain contracts for which a liability was recorded in the second quarter or Abbott settled with the counterparty in the second half of 2021.

The following summarizes the activity related to this restructuring action and the status of the related accruals as of March 31, 2022:

	Inventory-
	Related		Fixed Asset		Other Exit
(in millions)	Charges		Write-Downs		Costs		Total
Restructuring charges recorded in 2021	$	248	$	80	$	113	$	441
Payments		—		—		(90)		(90)
Other non-cash		(248)		(80)		—		(328)
Accrued balance at December 31, 2021		—		—		23		23
Payments and other adjustments		—		—		(3)		(3)
Accrued balance at March 31, 2022	$	—	$	—	$	20	$	20

In 2021, Abbott management approved plans to streamline operations in order to reduce costs and improve efficiencies in Abbott’s diagnostics, established pharmaceuticals, nutritional, and medical devices businesses. Abbott recorded employee-related severance and other charges of approximately $68 million in 2021 of which approximately $16 million was recorded in Cost of products sold, approximately $4 million was recorded in Research and development, and approximately $48 million was recorded in Selling, general and administrative expense.

The following summarizes the activity for these restructurings:

(in millions)
Restructuring charges	$	68
Payments and other adjustments		(7)
Accrued balance at December 31, 2021		61
Payments and other adjustments		(16)
Accrued balance at March 31, 2022	$	45

12

Note 7 — Incentive Stock Programs

In the first three months of 2022, Abbott granted 2,594,059 stock options, 514,148 restricted stock awards and 5,303,072 restricted stock units under its incentive stock program. At March 31, 2022, approximately 86 million shares were reserved for future grants. Information regarding the number of options outstanding and exercisable at March 31, 2022 is as follows:

	Outstanding		Exercisable
Number of shares		29,479,237		23,547,781
Weighted average remaining life (years)		5.9		5.1
Weighted average exercise price	$	69.87	$	59.23
Aggregate intrinsic value (in millions)	$	1,445	$	1,397

The total unrecognized share-based compensation cost at March 31, 2022 amounted to approximately $825 million which is expected to be recognized over the next three years.

Note 8 — Debt and Lines of Credit

On March 15, 2022, Abbott repaid the $750 million outstanding principal amount of its 2.55% Notes due 2022 upon maturity.

Note 9 — Financial Instruments, Derivatives and Fair Value Measures

Certain Abbott foreign subsidiaries enter into foreign currency forward exchange contracts to manage exposures to changes in foreign exchange rates primarily for anticipated intercompany purchases by those subsidiaries whose functional currencies are not the U.S. dollar. These contracts, with gross notional amounts totaling $8.5 billion at March 31, 2022 and $8.6 billion at December 31, 2021 are designated as cash flow hedges of the variability of the cash flows due to changes in foreign exchange rates and are recorded at fair value. Accumulated gains and losses as of March 31, 2022 will be included in Cost of products sold at the time the products are sold, generally through the next twelve to eighteen months.

Abbott enters into foreign currency forward exchange contracts to manage currency exposures for foreign currency denominated third-party trade payables and receivables, and for intercompany loans and trade accounts payable where the receivable or payable is denominated in a currency other than the functional currency of the entity. For intercompany loans, the contracts require Abbott to sell or buy foreign currencies, primarily European currencies, in exchange for primarily U.S. dollars and other European currencies. For intercompany and trade payables and receivables, the currency exposures are primarily the U.S. dollar and European currencies. At March 31, 2022 and December 31, 2021, Abbott held the gross notional amount of $12.2 billion of such foreign currency forward exchange contracts.

Abbott has designated a yen-denominated, 5-year term loan of approximately $491 million and $521 million as of March 31, 2022 and December 31, 2021, respectively, as a hedge of the net investment in certain foreign subsidiaries. The change in the value of the debt, which is due to changes in foreign exchange rates, is recorded in Accumulated other comprehensive income (loss), net of tax.

Abbott is a party to interest rate hedge contracts totaling approximately $2.9 billion at March 31, 2022 and December 31, 2021 to manage its exposure to changes in the fair value of fixed-rate debt. These contracts are designated as fair value hedges of the variability of the fair value of fixed-rate debt due to changes in the long-term benchmark interest rates. The effect of the hedge is to change a fixed-rate interest obligation to a variable rate for that portion of the debt. Abbott records the contracts at fair value and adjusts the carrying amount of the fixed-rate debt by an offsetting amount.

13

Note 9 — Financial Instruments, Derivatives and Fair Value Measures (Continued)

The following table summarizes the amounts and location of certain derivative financial instruments as of March 31, 2022 and December 31, 2021:

	Fair Value - Assets					Fair Value - Liabilities
	March 31,		Dec. 31,			March 31,		Dec. 31,
(in millions)	2022		2021		Balance Sheet Caption	2022		2021		Balance Sheet Caption
Interest rate swaps designated as fair value hedges	$	—	$	87	Deferred income taxes and other assets	$	34	$	—	Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments		204		222	Prepaid expenses and other receivables		183		65	Other accrued liabilities
Others not designated as hedges		149		70	Prepaid expenses and other receivables		93		32	Other accrued liabilities
Debt designated as a hedge of net investment in a foreign subsidiary		—		—	n/a		491		521	Long-term debt
	$	353	$	379		$	801	$	618

The following table summarizes the activity for foreign currency forward exchange contracts designated as cash flow hedges and certain other derivative financial instruments, as well as the amounts and location of income (expense) and gain (loss) reclassified into income for the three months ended March 31, 2022 and 2021.

	Gain (loss) Recognized in				Income (expense) and
	Other Comprehensive				Gain (loss) Reclassified
	Income (loss)				into Income
(in millions)	2022		2021		2022		2021		Income Statement Caption
Foreign currency forward exchange contracts designated as cash flow hedges	$	(49)	$	134	$	27	$	(23)	Cost of products sold
Debt designated as a hedge of net investment in a foreign subsidiary		30		35		—		—	n/a
Interest rate swaps designated as fair value hedges		n/a		n/a		(121)		(69)	Interest expense

Losses of $51 million and gains of $49 million were recognized in the three months ended March 31, 2022 and 2021, respectively, related to foreign currency forward exchange contracts not designated as a hedge. These amounts are reported in the Condensed Consolidated Statement of Earnings on the Net foreign exchange (gain) loss line.

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Note 9 — Financial Instruments, Derivatives and Fair Value Measures (Continued)

The carrying values and fair values of certain financial instruments as of March 31, 2022 and December 31, 2021 are shown in the following table. The carrying values of all other financial instruments approximate their estimated fair values. The counterparties to financial instruments consist of select major international financial institutions. Abbott does not expect any losses from non-performance by these counterparties.

	March 31, 2022				December 31, 2021
	Carrying		Fair		Carrying		Fair
(in millions)	Value		Value		Value		Value
Long-term Investment Securities:
Equity securities	$	703	$	703	$	748	$	748
Other		60		60		68		68
Total long-term debt		(17,090)		(18,704)		(18,050)		(21,152)
Foreign Currency Forward Exchange Contracts:
Receivable position		353		353		292		292
(Payable) position		(276)		(276)		(97)		(97)
Interest Rate Hedge Contracts:
Receivable position		—		—		87		87
(Payable) position		(34)		(34)		—		—

The fair value of the debt was determined based on significant other observable inputs, including current interest rates.

The following table summarizes the bases used to measure certain assets and liabilities at fair value on a recurring basis in the balance sheet:

			Basis of Fair Value Measurement
			Quoted		Significant
			Prices in		Other		Significant
	Outstanding		Active		Observable		Unobservable
(in millions)	Balances		Markets		Inputs		Inputs
March 31, 2022:
Equity securities	$	367	$	367	$	—	$	—
Foreign currency forward exchange contracts		353		—		353		—
Total Assets	$	720	$	367	$	353	$	—
Fair value of hedged long-term debt	$	2,805	$	—	$	2,805	$	—
Interest rate swap derivative financial instruments		34		—		34		—
Foreign currency forward exchange contracts		276		—		276		—
Contingent consideration related to business combinations		134		—		—		134
Total Liabilities	$	3,249	$	—	$	3,115	$	134
December 31, 2021:
Equity securities	$	402	$	402	$	—	$	—
Interest rate swap derivative financial instruments		87		—		87		—
Foreign currency forward exchange contracts		292		—		292		—
Total Assets	$	781	$	402	$	379	$	—
Fair value of hedged long-term debt	$	2,926	$	—	$	2,926	$	—
Foreign currency forward exchange contracts		97		—		97		—
Contingent consideration related to business combinations		130		—		—		130
Total Liabilities	$	3,153	$	—	$	3,023	$	130

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Note 9 — Financial Instruments, Derivatives and Fair Value Measures (Continued)

The fair value of foreign currency forward exchange contracts is determined using a market approach, which utilizes values for comparable derivative instruments. The fair value of debt was determined based on the face value of the debt adjusted for the fair value of the interest rate swaps, which is based on a discounted cash flow analysis using significant other observable inputs. The fair value of the contingent consideration was determined based on independent appraisals at the time of acquisition, adjusted for the time value of money and other changes in fair value.

Note 10 — Litigation and Environmental Matters

Abbott has been identified as a potentially responsible party for investigation and cleanup costs at a number of locations in the United States and Puerto Rico under federal and state remediation laws and is investigating potential contamination at a number of company-owned locations. Abbott has recorded an estimated cleanup cost for each site for which management believes Abbott has a probable loss exposure. No individual site cleanup exposure is expected to exceed $4 million, and the aggregate cleanup exposure is not expected to exceed $10 million.

Abbott is involved in various claims and legal proceedings, and Abbott estimates the range of possible loss for its legal proceedings and environmental exposures to be from approximately $30 million to $45 million. The recorded accrual balance at March 31, 2022 for these proceedings and exposures was approximately $40 million. This accrual represents management’s best estimate of probable loss, as defined by FASB ASC No. 450, “Contingencies.” Within the next year, legal proceedings may occur that may result in a change in the estimated loss accrued by Abbott. While it is not feasible to predict the outcome of all such proceedings and exposures with certainty, management believes that their ultimate disposition should not have a material adverse effect on Abbott’s financial position, cash flows, or results of operations.

Note 11 — Post-Employment Benefits

Retirement plans consist of defined benefit, defined contribution, and medical and dental plans. Net periodic benefit costs, other than service costs, are recognized in the Other (income) expense, net line of the Condensed Consolidated Statement of Earnings. Net cost recognized for the three months ended March 31 for Abbott’s major defined benefit plans and post-employment medical and dental benefit plans is as follows:

	Defined Benefit Plans				Medical and Dental Plans
	March 31,		March 31,		March 31,		March 31,
(in millions)	2022		2021		2022		2021
Service cost — benefits earned during the period	$	96	$	100	$	13	$	14
Interest cost on projected benefit obligations		76		62		10		8
Expected return on plan assets		(236)		(211)		(7)		(7)
Net amortization of:
Actuarial loss, net		59		81		5		7
Prior service cost (credit)		—		—		(6)		(7)
Net cost (credit)	$	(5)	$	32	$	15	$	15

Abbott funds its domestic defined benefit plans according to Internal Revenue Service funding limitations. International pension plans are funded according to similar regulations. In the first three months of 2022 and 2021, $334 million and $16 million, respectively, were contributed to defined benefit plans. Contributions made to post-employment medical and dental plans in the first three months of 2022 were $28 million. No contributions were made to the post-employment medical and dental plans in the first three months of 2021.

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Note 12 — Taxes on Earnings

Taxes on earnings reflect the estimated annual effective rates and include charges for interest and penalties. In the first three months of 2022 and 2021, taxes on earnings include approximately $30 million and $80 million, respectively, in excess tax benefits associated with share-based compensation. In the first three months of 2022, taxes on earnings also include approximately $30 million of tax expense as the result of the resolution of various tax positions related to prior years.

Tax authorities in various jurisdictions regularly review Abbott’s income tax filings. Abbott believes that it is reasonably possible that the recorded amount of gross unrecognized tax benefits may decrease approximately $70 million to $80 million, including cash adjustments, within the next twelve months as a result of concluding various domestic and international tax matters.

Note 13 — Segment 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, physicians’ offices and alternate-care testing sites. For segment reporting purposes, the Core Laboratory Diagnostics, Rapid Diagnostics, Molecular Diagnostics and Point of Care Diagnostics 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, Heart Failure, Vascular, Structural Heart, Neuromodulation 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.

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Note 13 — Segment Information (Continued)

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

	Three Months Ended March 31
	Net Sales to				Operating
	External Customers				Earnings
(in millions)	2022		2021		2022		2021
Established Pharmaceutical Products	$	1,147	$	1,070	$	242	$	169
Nutritional Products		1,894		2,036		251		467
Diagnostic Products		5,286		4,014		2,569		1,701
Medical Devices		3,565		3,320		1,078		1,007
Total Reportable Segments		11,892		10,440		4,140		3,344
Other		3		16
Net sales	$	11,895	$	10,456
Corporate functions and benefit plans costs						(114)		(114)
Net interest expense						(117)		(124)
Share-based compensation (a)						(305)		(288)
Amortization of intangible assets						(512)		(509)
Other, net (b)						(216)		(266)
Earnings before taxes					$	2,876	$	2,043

(a) Approximately 45 percent of the annual net cost of share-based awards will typically be recognized in the first quarter due to the timing of the granting of share-based awards.

(b) Other, net for the three months ended March 31, 2022 includes $120 million of charges related to a voluntary recall within the Nutritional Products segment. Other, net for the three months ended March 31, 2021 includes net costs related to certain litigation. Other, net for the three months ended March 31, 2022 and 2021 also includes integration costs associated with the acquisitions of St. Jude Medical and Alere Inc., and restructuring charges.

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Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

Financial Review - Results of Operations

Abbott’s revenues are derived primarily from the sale of a broad line of health care products under short-term receivable arrangements. Patent protection and licenses, technological and performance features, and inclusion of Abbott’s products under a contract most impact which products are sold; price controls, competition and rebates most impact the net selling prices of products; and foreign currency translation impacts the measurement of net sales and costs. Abbott’s primary products are medical devices, diagnostic testing products, nutritional products and branded generic pharmaceuticals.

The following table details sales by reportable segment for the three months ended March 31. Percent changes are versus the prior year and are based on unrounded numbers.

	Net Sales to External Customers
	Three Months		Three Months
	Ended		Ended				Impact of		Total Change
	March 31,		March 31,		Total		Foreign		Excl. Foreign
(in millions)	2022		2021		Change		Exchange		Exchange
Established Pharmaceutical Products	$	1,147	$	1,070	7.1	%	(6.3)	%	13.4	%
Nutritional Products		1,894		2,036	(7.0)		(2.6)		(4.4)
Diagnostic Products		5,286		4,014	31.7		(3.4)		35.1
Medical Devices		3,565		3,320	7.4		(4.1)		11.5
Total Reportable Segments		11,892		10,440	13.9		(3.8)		17.7
Other		3		16	(85.8)		—		(85.8)
Net Sales	$	11,895	$	10,456	13.8		(3.7)		17.5
Total U.S.	$	4,937	$	3,838	28.6		—		28.6
Total International	$	6,958	$	6,618	5.1		(6.0)		11.1

Note: In order to compute results excluding the impact of exchange rates, current year U.S. dollar sales are multiplied or divided, as appropriate, by the current year average foreign exchange rates and then those amounts are multiplied or divided, as appropriate, by the prior year average foreign exchange rates.

The 17.5 percent increase in total net sales during the first three months of 2022, excluding the impact of foreign exchange, reflected demand for Abbott’s rapid diagnostics tests to detect COVID-19 as well as growth in Abbott’s Medical Devices and Established Pharmaceutical Products segments partially offset by lower Nutritional sales. During the first quarter of 2022, Abbott’s COVID-19 testing-related sales totaled approximately $3.3 billion led by combined sales of approximately $3.0 billion related to Abbott’s BinaxNOW^®, Panbio^®, and ID NOW^® rapid testing platforms. During the first quarter of 2021, Abbott’s COVID-19 testing-related sales totaled approximately $2.2 billion led by combined sales of approximately $1.8 billion related to Abbott’s BinaxNOW, Panbio, and ID NOW rapid testing platforms. Excluding the impact of COVID-19 testing-related sales, Abbott’s total net sales increased 3.9 percent. Excluding the impacts of COVID-19 testing-related sales and foreign exchange, Abbott’s total net sales increased 7.7 percent. Abbott’s net sales were unfavorably impacted by changes in foreign exchange rates in the first quarter as the relatively stronger U.S. dollar decreased total international sales by 6.0 percent and total sales by 3.7 percent.

Due to the unpredictability of the duration and impact of the current COVID-19 pandemic, the future extent to which the COVID-19 pandemic will have a material effect on Abbott’s business, financial condition or results of operations is uncertain.

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The table below provides detail by sales category for the three months ended March 31. Percent changes are versus the prior year and are based on unrounded numbers.

							Impact of		Total Change
	March 31,		March 31,		Total		Foreign		Excl. Foreign
(in millions)	2022		2021		Change		Exchange		Exchange
Established Pharmaceutical Products —
Key Emerging Markets	$	902	$	821	9.8	%	(7.3)	%	17.1	%
Other Emerging Markets		245		249	(1.7)		(2.9)		1.2
Nutritionals —
International Pediatric Nutritionals		509		558	(8.8)		(3.4)		(5.4)
U.S. Pediatric Nutritionals		338		508	(33.6)		—		(33.6)
International Adult Nutritionals		708		642	10.3		(5.3)		15.6
U.S. Adult Nutritionals		339		328	3.7		—		3.7
Diagnostics —
Core Laboratory		1,184		1,182	0.1		(4.1)		4.2
Molecular		420		447	(5.9)		(2.9)		(3.0)
Point of Care		128		129	(0.6)		(1.0)		0.4
Rapid Diagnostics		3,554		2,256	57.5		(3.3)		60.8
Medical Devices —
Rhythm Management		524		519	1.0		(3.2)		4.2
Electrophysiology		485		431	12.6		(4.2)		16.8
Heart Failure		221		194	14.2		(2.0)		16.2
Vascular		619		635	(2.6)		(3.6)		1.0
Structural Heart		411		377	9.1		(4.7)		13.8
Neuromodulation		179		184	(3.1)		(1.6)		(1.5)
Diabetes Care		1,126		980	14.9		(5.5)		20.4

Excluding the unfavorable effect of foreign exchange, sales in Key Emerging Markets for Established Pharmaceutical Products increased 17.1 percent, led by double-digit growth in several countries and therapeutic areas, including gastroenterology, central nervous system/pain management, and respiratory products. Other Emerging Markets, excluding the effect of foreign exchange, increased by 1.2 percent.

International Pediatric Nutritional sales, excluding the effect of foreign exchange, decreased 5.4 percent. The decrease reflects lower sales due to challenging market dynamics in the infant category in Greater China partially offset by higher volumes sold in various countries in Southeast Asia, Latin America and the Middle East. International Adult Nutritional sales, excluding the effect of foreign exchange, increased 15.6 percent, and U.S. Adult Nutritional sales increased 3.7 percent, reflecting continued growth of the Ensure^® and Glucerna^® brands in several countries including the U.S.

In U.S. Pediatric Nutritionals, Abbott initiated a voluntary recall in February 2022 of certain infant powder formula products manufactured at one of its U.S. facilities and stopped production at the facility. The 33.6 percent decrease in U.S. Pediatric Nutritional sales reflects the impact of the recall and production stoppage partially offset by increased demand for Abbott’s Pedialyte^® and PediaSure^® products. U.S. sales of certain infant powder formulas were $59 million in the first quarter of 2022 and $288 million in the first quarter of 2021. Abbott is working with the U.S. Food and Drug Administration (FDA) on corrective actions and enhancements so that operations at the facility can be restarted. Abbott cannot predict when manufacturing at the facility will restart. Abbott is also working to bring infant powder formula to the U.S. from its FDA-regulated facility in Europe and to increase production at other U.S. manufacturing plants.

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The 35.1 percent increase in Diagnostic Products sales, excluding the impact of foreign exchange, was driven by demand for Abbott’s portfolio of COVID-19 tests in Rapid Diagnostics and growth in routine diagnostic testing in Core Laboratory Diagnostics and Molecular Diagnostics. In Core Laboratory Diagnostics, sales increased 4.2 percent, excluding the effect of foreign exchange, due to the higher volume of routine diagnostic testing from the continued roll-out of the Alinity^® platform and an expanded menu of tests partially offset by lower sales of Abbott’s laboratory-based tests for the detection of COVID-19 IgG and IgM antibodies, which determine if someone was previously infected with the COVID-19 virus. In the first three months of 2022 and 2021, Core Laboratory Diagnostics COVID-19 IgG and IgM antibody testing-related sales on Abbott’s ARCHITECT^® and Alinity i platforms were $28 million and $54 million, respectively. In the first three months of 2022, Core Laboratory Diagnostics sales increased 2.4 percent, excluding COVID-19 testing-related sales, and increased 6.6 percent, excluding the impact of foreign exchange and COVID-19 testing-related sales.

The 3.0 percent decrease in Molecular Diagnostics sales, excluding the effect of foreign exchange, was driven by lower demand for Abbott’s laboratory-based molecular tests for COVID-19 on its m2000^® platform partially offset by growth in the base business from increased routine molecular testing and an expanded menu of tests. In the first three months of 2022 and 2021, Molecular Diagnostics COVID-19 testing-related sales were $246 million and $307 million, respectively. In the first three months of 2022, Molecular Diagnostics sales increased 24.8 percent, excluding COVID-19 testing-related sales, and increased 29.0 percent, excluding the impact of foreign exchange and COVID-19 testing-related sales.

In Rapid Diagnostics, sales increased 60.8 percent, excluding the effect of foreign exchange, due to the demand for Abbott’s COVID-19 tests on its rapid testing platforms, including the Panbio system, the ID NOW platform, and the BinaxNOW COVID-19 Ag Card test. In the first three months of 2022 and 2021, Rapid Diagnostics COVID-19 testing-related sales were approximately $3.0 billion and $1.8 billion, respectively. In the first three months of 2022, Rapid Diagnostics sales increased 21.6 percent, excluding COVID-19 testing-related sales, and increased 23.5 percent, excluding the impact of foreign exchange and COVID-19 testing-related sales. These increases reflect higher sales of ID NOW tests for flu, strep, and respiratory syncytial virus (RSV) as well as growth in other Rapid Diagnostics products.

Excluding the effect of foreign exchange, total Medical Devices sales grew 11.5 percent driven by double-digit growth in Diabetes Care, Electrophysiology, Structural Heart and Heart Failure. Growth in Diabetes Care sales was driven by continued growth of FreeStyle Libre^®, Abbott’s continuous glucose monitoring system, internationally and in the U.S. FreeStyle Libre sales totaled $995 million in the first three months of 2022, which reflected a 26.2 percent increase, excluding the effect of foreign exchange, over the first three months of 2021 when FreeStyle Libre sales totaled $827 million.

While procedure volumes across Abbott’s cardiovascular and neuromodulation businesses were negatively impacted by elevated COVID-19 case rates early in 2022, overall volume trends improved as case rates declined in the second half of the first quarter. In Electrophysiology, excluding the effect of foreign exchange, the increase in procedure volumes also reflects the U.S. roll-out of Abbott’s EnSite™ X EP System with Ensite Omnipolar Technology (OT), a new cardiac mapping platform available in the U.S., Japan and across Europe. In January 2022, Abbott announced FDA clearance for the EnSite X EP System with EnSite OT. The system leverages the Advisor™ HD Grid Catheter to provide a 360-degree view of the heart without regard to the orientation of the catheter in the heart.

Growth in Structural Heart, excluding the effect of foreign exchange, was broad-based across several areas of the business, including Amplatzer^® Amulet^® Left Atrial Appendage Occluder, which offers immediate closure of the left atrial appendage, an area in the heart where blood clots can form and MitraClip^®, Abbott’s market-leading device for the minimally invasive treatment of mitral regurgitation, a leaky heart valve. In Vascular, the 1.0 percent growth in sales, excluding the impact of foreign exchange, reflects higher endovascular sales partially offset by the negative effect of lower average pricing for drug-eluting stents (DES) in the U.S. and a lag in the recovery of percutaneous coronary intervention case rates compared to many other cardiovascular procedures.

In 2022, Medical Devices received various product approvals. In February 2022, Abbott received FDA approval for an expanded indication for its CardioMEMS™ HF system, a small implantable sensor and remote monitoring system that can detect early warning signs of worsening heart failure. In April 2022, Abbott announced FDA approval for its Aveir™ single-chamber leadless pacemaker for the treatment of patients in the U.S. with slow heart rhythms.

The gross profit margin percentage was 53.8 percent for the first quarter of 2022 compared to 53.0 percent for the first quarter of 2021. The increase in the quarter reflects the effect of higher sales volume of COVID-19 rapid tests, the impact of gross margin improvement initiatives, and the favorable impact of foreign exchange on costs partially offset by the impact of the voluntary product recall in the Nutritional business and higher inflation on various manufacturing inputs, commodities and distribution costs.

21

Research and development (R&D) expenses increased $43 million, or 6.5 percent, in the first quarter of 2022. The 2022 increase in R&D was primarily driven by higher spending on various projects to advance products in development partially offset by the favorable impact of foreign exchange.

Selling, general and administrative expenses were basically flat in the first quarter of 2022 compared to the first quarter of 2021. Higher selling and marketing spending to drive growth across various businesses was offset by the nonrecurrence of certain 2021 litigation costs and the favorable impact of foreign exchange.

Other (Income) Expense, net

Other income, net increased from $61 million of income in the first quarter of 2021 to $78 million of income in the first quarter of 2022. The increase in the first quarter was primarily due to higher income in 2022 related to the non-service cost components of net pension and post-retirement medical benefit costs partially offset by the change in earnings of equity method investments.

Interest Expense, net

Interest expense, net decreased $7 million in the first quarter of 2022 primarily due to the impact of higher interest rates on interest income in the first quarter of 2022 and the repayment of debt in the first quarter of 2022.

Taxes on Earnings

Taxes on earnings reflect the estimated annual effective rates and include charges for interest and penalties. In the first three months of 2022 and 2021, taxes on earnings include approximately $30 million and $80 million, respectively, in excess tax benefits associated with share-based compensation. In the first three months of 2022, taxes on earnings also include approximately $30 million of tax expense as the result of the resolution of various tax positions related to prior years.

Tax authorities in various jurisdictions regularly review Abbott’s income tax filings. Abbott believes that it is reasonably possible that the recorded amount of gross unrecognized tax benefits may decrease approximately $70 million to $80 million, including cash adjustments, within the next twelve months as a result of concluding various domestic and international tax matters.

Liquidity and Capital Resources March 31, 2022 Compared with December 31, 2021

Cash and cash equivalents decreased from $9.8 billion at December 31, 2021 to $7.7 billion at March 31, 2022 as cash used to fund share repurchases, the payment of dividends, the repayment of debt and capital expenditures was partially offset by cash generated from operations in the first three months of 2022. Working capital declined from $11.1 billion at December 31, 2021 to $10.8 billion at March 31, 2022 as the decrease in cash and cash equivalents and the increase in accounts payable were partially offset by increases in accounts receivable and inventory.

In the Condensed Consolidated Statement of Cash Flows, Net cash from operating activities for the first three months of 2022 totaled $2.1 billion, a decrease of $572 million compared to the prior year primarily due to an increased investment in various working capital components and the timing of pension and postretirement benefit plan contributions partially offset by higher operating earnings and a reduction in cash taxes paid. Cash taxes paid in the first three months of 2022 totaled approximately $195 million versus $270 million in 2021. Other, net in Net cash from operating activities was a use of $205 million for the first three months of 2022 and a use of $6 million for the first three months of 2021. The year-over-year change in Other, net in Net cash from operating activities primarily reflects the timing of benefit plan contributions.

On March 15, 2022, Abbott repaid the $750 million outstanding principal amount of its 2.55% Notes due 2022 upon maturity.

In September 2019, the board of directors authorized the early redemption of up to $5 billion of outstanding long-term notes. As of March 31, 2022, $2.15 billion of the $5 billion authorization remains available.

At March 31, 2022, Abbott’s long-term debt rating was AA- by Standard & Poor’s Corporation and A1 by Moody’s Investors Service. Abbott expects to maintain an investment grade rating. Abbott has readily available financial resources, including lines of credit of $5 billion which expire in 2025.

22

In December 2021, the board of directors authorized the repurchase of up to $5 billion of Abbott’s common shares from time to time. The new authorization was in addition to the $1.081 billion portion of the share repurchase program authorized in 2019 that was unused as of December 31, 2021. In the first quarter of 2022, Abbott repurchased 17.3 million of its common shares for $2.1 billion which fully utilized the authorization remaining under the 2019 share repurchase program and a portion of the 2021 authorization. As of March 31, 2022, $3.981 billion remains available for repurchase under the 2021 repurchase program.

In the first quarter of 2022, Abbott declared a quarterly dividend of $0.47 per share on its common shares, which represents an increase of 4.4 percent over the $0.45 per share dividend declared in the first quarter of 2021.

Legislative Issues

Abbott’s primary markets are highly competitive and subject to substantial government regulations throughout the world. Abbott expects debate to continue over the availability, method of delivery, and payment for health care products and services. It is not possible to predict the extent to which Abbott or the health care industry in general might be adversely affected by these factors in the future. A more complete discussion of these factors is contained in Item 1, Business, and Item 1A, Risk Factors, in the 2021 Annual Report on Form 10-K.

Private Securities Litigation Reform Act of 1995 — A Caution Concerning Forward-Looking Statements

Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Abbott cautions that any forward-looking statements made by Abbott are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Economic, competitive, governmental, technological and other factors that may affect Abbott’s operations are discussed in Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021, and are incorporated herein by reference. Abbott undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law.

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PART I.     FINANCIAL INFORMATION

Item 4.      Controls and Procedures

(a) Evaluation of disclosure controls and procedures. The Chief Executive Officer, Robert B. Ford, and Chief Financial Officer, Robert E. Funck, Jr., evaluated the effectiveness of Abbott Laboratories’ disclosure controls and procedures as of the end of the period covered by this report, and concluded that Abbott Laboratories’ disclosure controls and procedures were effective to ensure that information Abbott is required to disclose in the reports that it files or submits with the Securities and Exchange Commission (the “Commission”) under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and to ensure that information required to be disclosed by Abbott in the reports that it files or submits under the Exchange Act is accumulated and communicated to Abbott’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in internal control over financial reporting. During the quarter ended March 31, 2022, there were no changes in Abbott’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, Abbott’s internal control over financial reporting.

PART II.   OTHER INFORMATION

Item 1.       Legal Proceedings

Abbott is involved in various claims, legal proceedings and investigations as described in our Annual Report on Form 10-K for the year ended December 31, 2021, including (as of March 31, 2022, except where noted below) those described below. While it is not feasible to predict the outcome of such pending claims, proceedings and investigations with certainty, management is of the opinion that their ultimate resolution should not have a material adverse effect on Abbott’s financial position, cash flows, or results of operations.

In its 2021 Annual Report on Form 10-K, Abbott reported that it is a defendant in numerous lawsuits in federal and state courts involving certain of its specialty infant formula products administered to preterm infants. In April 2022, the U.S. Judicial Panel on Multidistrict Litigation ordered the consolidation of the federal court cases in the Northern District of Illinois for pretrial purposes.

24

Item 2.       Unregistered Sales of Equity Securities and Use of Proceeds

(c) Issuer Purchases of Equity Securities

						(d) Maximum
						Number (or
					(c) Total Number	Approximate
					of Shares (or	Dollar Value) of
	(a) Total				Units) Purchased	Shares (or Units)
	Number of		(b) Average		as Part of	that May Yet Be
	Shares (or		Price Paid per		Publicly	Purchased Under
	Units)		Share (or		Announced Plans	the Plans or
Period	Purchased		Unit)		or Programs	Programs
January 1, 2022 – January 31, 2022	650,000	(1)  ​	$	127.262	650,000	$	5,998,449,112	(2)​
February 1, 2022 – February 28, 2022	8,550,000	(1)​		123.643	8,550,000		4,941,301,237	(2)​
March 1, 2022 – March 31, 2022	8,113,060	(1)​		118.344	8,113,060		3,981,169,070	(2)​
Total	17,313,060	(1)​	$	121.296	17,313,060	$	3,981,169,070	(2)​

1. These shares do not include the shares surrendered to Abbott to satisfy tax withholding obligations in connection with the vesting of restricted stock or restricted stock units.

2. On October 11, 2019, the board of directors authorized the repurchase of up to $3 billion of Abbott common shares, from time to time (the “2019 Plan”). On December 10, 2021, the board of directors authorized the repurchase of up to $5 billion of Abbott common shares, from time to time (the “2021 Plan”). The amount available for repurchase under the remaining portion of the 2019 Plan has been fully utilized as part of the share repurchases in the first quarter of 2022.

25

Item 6.    Exhibits

Exhibit No.	Exhibit
3.1	By-Laws of Abbott Laboratories, as amended and restated effective April 29, 2022, filed as Exhibit 3.1 to the Abbott Laboratories Current Report on Form 8-K filed on February 22, 2022.
31.1	Certification of Chief Executive Officer Required by Rule 13a-14(a) (17 CFR 240.13a-14(a)).
31.2	Certification of Chief Financial Officer Required by Rule 13a-14(a) (17 CFR 240.13a-14(a)).
Exhibits 32.1 and 32.2 are furnished herewith and should not be deemed to be “filed” under the Securities Exchange Act of 1934.
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following financial statements and notes from the Abbott Laboratories Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, formatted in Inline XBRL: (i) Condensed Consolidated Statement of Earnings; (ii) Condensed Consolidated Statement of Comprehensive Income; (iii) Condensed Consolidated Balance Sheet; (iv) Condensed Consolidated Statement of Shareholders’ Investment; (v) Condensed Consolidated Statement of Cash Flows; and (vi) Notes to the Condensed Consolidated Financial Statements.
104	Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document and included in Exhibit 101).

26

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ABBOTT LABORATORIES
By:	/s/ Robert E. Funck, Jr.
	Robert E. Funck, Jr.
	Executive Vice President, Finance and Chief Financial Officer
	Date: May 3, 2022

27

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Required by Rule 13a-14(a) (17 CFR 240.13a-14(a))

I, Robert B. Ford, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Abbott Laboratories;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of Abbott as of, and for, the periods presented in this report;

4. Abbott’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for Abbott and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Abbott, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of Abbott’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in Abbott’s internal control over financial reporting that occurred during Abbott’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, Abbott’s internal control over financial reporting; and

5. Abbott’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Abbott’s auditors and the audit committee of Abbott’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Abbott’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in Abbott’s internal control over financial reporting.

	/s/ Robert B. Ford
Date: May 3, 2022	Robert B. Ford
	Chairman of the Board and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Required by Rule 13a-14(a) (17 CFR 240.13a-14(a))

I, Robert E. Funck, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Abbott Laboratories;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of Abbott as of, and for, the periods presented in this report;

4. Abbott’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for Abbott and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Abbott, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of Abbott’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in Abbott’s internal control over financial reporting that occurred during Abbott’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, Abbott’s internal control over financial reporting; and

5. Abbott’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Abbott’s auditors and the audit committee of Abbott’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Abbott’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in Abbott’s internal control over financial reporting.

	/s/ Robert E. Funck, Jr.
Date: May 3, 2022	Robert E. Funck, Jr.
	Executive Vice President, Finance
	and Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification Pursuant To

18 U.S.C. Section 1350

As Adopted Pursuant To

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Abbott Laboratories (the “Company”) on Form 10-Q for the period ended

March 31, 2022 as filed with the Securities and Exchange Commission (the “Report”), I, Robert B. Ford, Chairman of the Board and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Robert B. Ford

Robert B. Ford

Chairman of the Board and Chief Executive Officer

May 3, 2022

A signed original of this written statement required by Section 906 has been provided to Abbott Laboratories and will be retained by Abbott Laboratories and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Certification Pursuant To

18 U.S.C. Section 1350

As Adopted Pursuant To

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Abbott Laboratories (the “Company”) on Form 10-Q for the period ended

March 31, 2022 as filed with the Securities and Exchange Commission (the “Report”), I, Robert E. Funck, Jr., Executive Vice President, Finance and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Robert E. Funck, Jr.

Robert E. Funck, Jr.

Executive Vice President, Finance

and Chief Financial Officer

May 3, 2022

A signed original of this written statement required by Section 906 has been provided to Abbott Laboratories and will be retained by Abbott Laboratories and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2022 shares
Document and Entity Information
Document Type	10-Q
Document Transition Report	false
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Entity File Number	1-2189
Entity Registrant Name	ABBOTT LABORATORIES
Entity Tax Identification Number	36-0698440
Entity Incorporation, State or Country Code	IL
Entity Address, State or Province	IL
Entity Address, Address Line One	100 Abbott Park Road
Entity Address, City or Town	Abbott Park
Entity Address, Postal Zip Code	60064-6400
City Area Code	224
Local Phone Number	667-6100
Title of 12(b) Security	Common Shares, Without Par Value
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	1,750,942,289
Entity Central Index Key	0000001800
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Amendment Flag	false
New York Stock Exchange
Document and Entity Information
Security Exchange Name	NYSE
Trading Symbol	ABT
Chicago Stock Exchange
Document and Entity Information
Security Exchange Name	CHX

XML

Condensed Consolidated Statement of Earnings - USD ($) shares in Thousands, $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Condensed Consolidated Statement of Earnings
Net Sales	$ 11,895	$ 10,456
Cost of products sold, excluding amortization of intangible assets	4,987	4,401
Amortization of intangible assets	512	509
Research and development	697	654
Selling, general and administrative	2,787	2,783
Total operating cost and expenses	8,983	8,347
Operating earnings	2,912	2,109
Interest expense	131	135
Interest (income)	(14)	(11)
Net foreign exchange (gain) loss	(3)	3
Other (income) expense, net	(78)	(61)
Earnings before taxes	2,876	2,043
Taxes on earnings	429	250
Net Earnings	$ 2,447	$ 1,793
Basic Earnings Per Common Share (in dollars per share)	$ 1.38	$ 1.00
Diluted Earnings Per Common Share (in dollars per share)	$ 1.37	$ 1.00
Average Number of Common Shares Outstanding Used for Basic Earnings Per Common Share	1,761,911	1,776,842
Dilutive Common Stock Options	12,631	14,661
Average Number of Common Shares Outstanding Plus Dilutive Common Stock Options	1,774,542	1,791,503
Outstanding Common Stock Options Having No Dilutive Effect	2,655	2,694

XML

Condensed Consolidated Statement of Comprehensive Income - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Condensed Consolidated Statement of Comprehensive Income
Net Earnings	$ 2,447	$ 1,793
Foreign currency translation gain (loss) adjustments	(106)	(536)
Net actuarial gains (losses) and amortization of net actuarial (losses) and prior service (costs) and credits, net of taxes of $13 in 2022 and $18 in 2021	62	85
Net gains (losses) for derivative instruments designated as cash flow hedges, net of taxes of $(15) in 2022 and $46 in 2021	(56)	112
Other comprehensive income (loss)	(100)	(339)
Comprehensive Income (Loss)	2,347	$ 1,454
Supplemental Accumulated Other Comprehensive Income (Loss) Information, net of tax:
Cumulative foreign currency translation (loss) adjustments	(5,945)		$ (5,839)
Net actuarial (losses) and prior service (costs) and credits	(2,608)		(2,670)
Cumulative gains (losses) on derivative instruments designated as cash flow hedges	79		135
Accumulated Other Comprehensive Income (Loss)	$ (8,474)		$ (8,374)

XML

Condensed Consolidated Statement of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Condensed Consolidated Statement of Comprehensive Income
Net actuarial gains (losses) and amortization of net actuarial (losses) and prior service (costs) and credits, taxes	$ 13	$ 18
Net gains (losses) for derivative instruments designated as cash flow hedges, taxes	$ (15)	$ 46

XML

Condensed Consolidated Balance Sheet - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 7,675	$ 9,799
Short-term investments	483	450
Trade receivables, less allowances of $640 in 2022 and $519 in 2021	7,179	6,487
Inventories:
Finished products	3,470	3,081
Work in process	695	694
Materials	1,526	1,382
Total inventories	5,691	5,157
Prepaid expenses and other receivables	2,401	2,346
Total Current Assets	23,429	24,239
Investments	763	816
Property and equipment, at cost	19,521	19,364
Less: accumulated depreciation and amortization	10,613	10,405
Net property and equipment	8,908	8,959
Intangible assets, net of amortization	12,225	12,739
Goodwill	23,179	23,231
Deferred income taxes and other assets	5,503	5,212
Total Assets	74,007	75,196
Current liabilities:
Trade accounts payable	4,757	4,408
Salaries, wages and commissions	1,147	1,625
Other accrued liabilities	5,577	5,181
Dividends payable	824	831
Income taxes payable	338	306
Current portion of long-term debt	4	754
Total current liabilities	12,647	13,105
Long-term debt	17,086	17,296
Post-employment obligations, deferred income taxes and other long-term liabilities	8,645	8,771
Commitments and contingencies
Shareholders' investment:
Preferred shares, one dollar par value Authorized - 1,000,000 shares, none issued
Common shares, without par value Authorized - 2,400,000,000 shares Issued at stated capital amount - Shares: 2022: 1,985,525,053; 2021: 1,985,273,421	24,304	24,470
Common shares held in treasury, at cost - Shares: 2022: 234,582,764; 2021: 221,191,228	(13,726)	(11,822)
Earnings employed in the business	33,295	31,528
Accumulated other comprehensive income (loss)	(8,474)	(8,374)
Total Abbott Shareholders' Investment	35,399	35,802
Noncontrolling interests in subsidiaries	230	222
Total Shareholders' Investment	35,629	36,024
Total Liabilities and Shareholders' Investment	$ 74,007	$ 75,196

XML

Condensed Consolidated Balance Sheet (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Condensed Consolidated Balance Sheet
Trade receivables, allowances (in dollars)	$ 640	$ 519
Preferred shares, par value (in dollars per share)	$ 1	$ 1
Preferred shares, authorized shares	1,000,000	1,000,000
Preferred shares, issued shares	0	0
Common shares, authorized shares	2,400,000,000	2,400,000,000
Common shares, issued shares	1,985,525,053	1,985,273,421
Common shares held in treasury, shares	234,582,764	221,191,228

XML

Condensed Consolidated Statement of Shareholders Investment - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Increase (Decrease) in Shareholders' Investment
Beginning of Period	$ 36,024
Net Earnings	2,447	$ 1,793
Other comprehensive income (loss)	(100)	(339)
End of Period	35,629
Common Shares:
Increase (Decrease) in Shareholders' Investment
Beginning of Period	24,470	24,145
Issued under incentive stock programs	14	47
Share-based compensation	324	304
Issuance of restricted stock awards	(504)	(473)
End of Period	24,304	24,023
Common Shares Held in Treasury:
Increase (Decrease) in Shareholders' Investment
Beginning of Period	(11,822)	(10,042)
Issued under incentive stock programs	223	231
Purchased	(2,127)	(34)
End of Period	(13,726)	(9,845)
Earnings Employed in the Business:
Increase (Decrease) in Shareholders' Investment
Beginning of Period	31,528	27,627
Net Earnings	2,447	1,793
Cash dividends declared on common shares	(826)	(803)
Effect of common and treasury share transactions	146	52
End of Period	33,295	28,669
Accumulated Other Comprehensive Income (Loss):
Increase (Decrease) in Shareholders' Investment
Beginning of Period	(8,374)	(8,946)
Other comprehensive income (loss)	(100)	(339)
End of Period	(8,474)	(9,285)
Noncontrolling Interests in Subsidiaries:
Increase (Decrease) in Shareholders' Investment
Beginning of Period	222	219
Noncontrolling Interests' share of income, business combinations, net of distributions and share repurchases	8	7
End of Period	$ 230	$ 226

XML

Condensed Consolidated Statement of Shareholders Investment (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Increase (Decrease) in Shareholders' Investment
Balance at beginning of period (in shares)	221,191,228
Balance at end of period (in shares)	234,582,764
Common Shares:
Increase (Decrease) in Shareholders' Investment
Balance at beginning of period (in shares)	1,985,273,421	1,981,156,896
Issued under incentive stock programs (in shares)	251,632	1,048,595
Balance at end of period (in shares)	1,985,525,053	1,982,205,491
Common Shares Held in Treasury:
Increase (Decrease) in Shareholders' Investment
Balance at beginning of period (in shares)	221,191,228	209,926,622
Issued under incentive stock programs (in shares)	4,144,476	4,818,787
Purchased (in shares)	17,536,012	277,508
Balance at end of period (in shares)	234,582,764	205,385,343
Earnings Employed in the Business:
Increase (Decrease) in Shareholders' Investment
Cash dividends declared per common share	$ 0.47	$ 0.45

XML

Condensed Consolidated Statement of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash Flow From (Used in) Operating Activities:
Net earnings	$ 2,447	$ 1,793
Adjustments to reconcile net earnings to net cash from operating activities -
Depreciation	311	425
Amortization of intangible assets	512	509
Share-based compensation	305	288
Trade receivables	(751)	165
Inventories	(554)	(537)
Other, net	(205)	(6)
Net Cash From Operating Activities	2,065	2,637
Cash Flow From (Used in) Investing Activities:
Acquisitions of property and equipment	(321)	(397)
Acquisitions of businesses and technologies, net of cash acquired		(15)
Sales (purchases) of other investment securities, net	(41)	(14)
Other	2	4
Net Cash (Used in) Investing Activities	(360)	(422)
Cash Flow From (Used in) Financing Activities:
Net borrowings (repayments) of short-term debt and other	8	24
Repayments of long-term debt	(751)	(2)
Purchases of common shares	(2,307)	(275)
Proceeds from stock options exercised	59	86
Dividends paid	(832)	(800)
Net Cash (Used in) Financing Activities	(3,823)	(967)
Effect of exchange rate changes on cash and cash equivalents	(6)	(32)
Net Increase (Decrease) in Cash and Cash Equivalents	(2,124)	1,216
Cash and Cash Equivalents, Beginning of Year	9,799	6,838
Cash and Cash Equivalents, End of Period	$ 7,675	$ 8,054

XML

Basis of Presentation

3 Months Ended

Mar. 31, 2022

Basis of Presentation

Basis of Presentation

Note 1 — Basis of Presentation

The accompanying unaudited, condensed consolidated financial statements have been prepared pursuant to rules and regulations of the Securities and Exchange Commission and, therefore, do not include all information and footnote disclosures normally included in audited financial statements. However, in the opinion of management, all adjustments (which include only normal adjustments) necessary to present fairly the results of operations, financial position and cash flows have been made. It is suggested that these statements be read in conjunction with the financial statements included in Abbott’s Annual Report on Form 10-K for the year ended December 31, 2021. The condensed consolidated financial statements include the accounts of the parent company and subsidiaries, after elimination of intercompany transactions.

XML

Revenue

3 Months Ended

Mar. 31, 2022

Revenue

Revenue

Note 2 — Revenue

Abbott’s revenues are derived primarily from the sale of a broad line of health care products under short-term receivable arrangements. Abbott has four reportable segments: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices.

The following table provides detail by sales category:

	Three Months Ended March 31, 2022						Three Months Ended March 31, 2021
(in millions)	U.S.		Int’l		Total		U.S.		Int’l		Total
Established Pharmaceutical Products —
Key Emerging Markets	$	—	$	902	$	902	$	—	$	821	$	821
Other		—		245		245		—		249		249
Total		—		1,147		1,147		—		1,070		1,070
Nutritionals —
Pediatric Nutritionals		338		509		847		508		558		1,066
Adult Nutritionals		339		708		1,047		328		642		970
Total		677		1,217		1,894		836		1,200		2,036
Diagnostics —
Core Laboratory		268		916		1,184		271		911		1,182
Molecular		172		248		420		175		272		447
Point of Care		91		37		128		92		37		129
Rapid Diagnostics		2,210		1,344		3,554		1,103		1,153		2,256
Total		2,741		2,545		5,286		1,641		2,373		4,014
Medical Devices —
Rhythm Management		248		276		524		241		278		519
Electrophysiology		216		269		485		179		252		431
Heart Failure		167		54		221		145		49		194
Vascular		209		410		619		219		416		635
Structural Heart		190		221		411		169		208		377
Neuromodulation		143		36		179		145		39		184
Diabetes Care		343		783		1,126		253		727		980
Total		1,516		2,049		3,565		1,351		1,969		3,320
Other		3		—		3		10		6		16
Total	$	4,937	$	6,958	$	11,895	$	3,838	$	6,618	$	10,456

Note 2 — Revenue (Continued)

Remaining Performance Obligations

As of March 31, 2022, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) was approximately $3.8 billion in the Diagnostics segment and approximately $428 million in the Medical Devices segment. Abbott expects to recognize revenue on approximately 60 percent of these remaining performance obligations over the next 24 months, approximately 16 percent over the subsequent 12 months and the remainder thereafter.

These performance obligations primarily reflect the future sale of reagents/consumables in contracts with minimum purchase obligations, extended warranty or service obligations related to previously sold equipment, and remote monitoring services related to previously implanted devices. Abbott has applied the practical expedient described in Accounting Standards Codification (ASC) 606-10-50-14 and has not included remaining performance obligations related to contracts with original expected durations of one year or less in the amounts above.

Other Contract Assets and Liabilities

Abbott discloses Trade receivables separately in the Condensed Consolidated Balance Sheet at the net amount expected to be collected. Contract assets primarily relate to Abbott’s conditional right to consideration for work completed but not billed at the reporting date. Contract assets at the beginning and end of the period, as well as the changes in the balance, were not significant.

Contract liabilities primarily relate to payments received from customers in advance of performance under the contract. Abbott’s contract liabilities arise primarily in the Medical Devices reportable segment when payment is received upfront for various multi-period extended service arrangements.

Changes in the contract liabilities during the period are as follows:

(in millions)
Contract Liabilities:
Balance at December 31, 2021	$	520
Unearned revenue from cash received during the period		171
Revenue recognized related to contract liability balance		(178)
Balance at March 31, 2022	$	513

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Supplemental Financial Information

3 Months Ended

Mar. 31, 2022

Supplemental Financial Information

Supplemental Financial Information

Note 3 — Supplemental Financial Information

Shares of unvested restricted stock that contain non-forfeitable rights to dividends are treated as participating securities and are included in the computation of earnings per share under the two-class method. Under the two-class method, net earnings are allocated between common shares and participating securities. Net earnings allocated to common shares for the three months ended March 31, 2022 and 2021 were $2.438 billion and $1.785 billion, respectively.

Other, net in Net cash from operating activities in the Condensed Consolidated Statement of Cash Flows for the first three months of 2022 includes $334 million of pension contributions and the payment of cash taxes of approximately $195 million. The first three months of 2021 includes $16 million of pension contributions and the payment of cash taxes of approximately $270 million.

Note 3 — Supplemental Financial Information (Continued)

The following summarizes the activity for the first three months of 2022 related to the allowance for doubtful accounts as of March 31, 2022:

(in millions)
Allowance for Doubtful Accounts:
Balance at December 31, 2021	$	313
Provisions/charges to income		3
Amounts charged off and other deductions		(15)
Balance at March 31, 2022	$	301

The allowance for doubtful accounts reflects the current estimate of credit losses expected to be incurred over the life of the accounts receivable. Abbott considers various factors in establishing, monitoring, and adjusting its allowance for doubtful accounts, including the aging of the accounts and aging trends, the historical level of charge-offs, and specific exposures related to particular customers. Abbott also monitors other risk factors and forward-looking information, such as country risk, when determining credit limits for customers and establishing adequate allowances.

The components of long-term investments as of March 31, 2022 and December 31, 2021 are as follows:

	March 31,		December 31,
(in millions)	2022		2021
Long-term Investments:
Equity securities	$	703	$	748
Other		60		68
Total	$	763	$	816

The decrease in Abbott’s long-term investments as of March 31, 2022 versus the balance as of December 31, 2021 primarily relates to a decrease in the value of investments held in a rabbi trust.

Abbott’s equity securities as of March 31, 2022, include $357 million of investments in mutual funds that are held in a rabbi trust and were acquired as part of the St. Jude Medical, Inc. (St. Jude Medical) business acquisition. These investments, which are specifically designated as available for the purpose of paying benefits under a deferred compensation plan, are not available for general corporate purposes and are subject to creditor claims in the event of insolvency.

Abbott also holds certain investments as of March 31, 2022 with a carrying value of $244 million that are accounted for under the equity method of accounting and other equity investments with a carrying value of $92 million that do not have a readily determinable fair value.

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Changes in Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2022

Changes in Accumulated Other Comprehensive Income (Loss)

Changes in Accumulated Other Comprehensive Income (Loss)

Note 4 — Changes in Accumulated Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss), net of income taxes, are as follows:

	Three Months Ended March 31
									Cumulative Gains (Losses)
	Cumulative Foreign				Net Actuarial (Losses) and				on Derivative Instruments
	Currency Translation				Prior Service (Costs) and				Designated as Cash Flow
	Adjustments				Credits				Hedges
(in millions)	2022		2021		2022		2021		2022		2021
Balance at January 1	$	(5,839)	$	(4,859)	$	(2,670)	$	(3,871)	$	135	$	(216)
Other comprehensive income (loss) before reclassifications		(106)		(536)		17		22		(34)		96
Amounts reclassified from accumulated other comprehensive income		—		—		45		63		(22)		16
Net current period comprehensive income (loss)		(106)		(536)		62		85		(56)		112
Balance at March 31	$	(5,945)	$	(5,395)	$	(2,608)	$	(3,786)	$	79	$	(104)

(Income) loss amounts reclassified from accumulated other comprehensive income related to cash flow hedges are recorded as Cost of products sold. Net actuarial losses and prior service cost are included as a component of net periodic benefit costs; see Note 11 for additional details.

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Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Note 5 — Goodwill and Intangible Assets

The total amount of goodwill reported was $23.2 billion at March 31, 2022 and December 31, 2021. Foreign currency translation adjustments decreased goodwill by approximately $50 million in the first three months of 2022. The amount of goodwill related to reportable segments at March 31, 2022 was $2.8 billion for the Established Pharmaceutical Products segment, $286 million for the Nutritional Products segment, $3.7 billion for the Diagnostic Products segment, and $16.4 billion for the Medical Devices segment. There was no reduction of goodwill relating to impairments in the first three months of 2022.

The gross amount of amortizable intangible assets, primarily product rights and technology, was $27.7 billion as of March 31, 2022 and December 31, 2021 and accumulated amortization was $16.4 billion as of March 31, 2022 and $15.9 billion as of December 31, 2021. Foreign currency translation adjustments increased intangible assets by $3 million in the first three months of 2022. Abbott’s estimated annual amortization expense for intangible assets is approximately $2.1 billion in 2022, $2.0 billion in 2023, $1.9 billion in 2024, $1.7 billion in 2025 and $1.6 billion in 2026.

Indefinite-lived intangible assets, which relate to in-process R&D (IPR&D) acquired in a business combination, were approximately $919 million as of March 31, 2022 and December 31, 2021.

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Restructuring Plans

3 Months Ended

Mar. 31, 2022

Restructuring Plans

Restructuring Plans

Note 6 — Restructuring Plans

On May 27, 2021, Abbott management approved a restructuring plan related to its Diagnostic Products segment to align its manufacturing network for COVID-19 diagnostic tests with changes in the second quarter in projected testing demand driven by several factors, including significant reductions in cases in the U.S. and other major developed countries, the accelerated rollout of COVID-19 vaccines globally and the U.S. health authority’s updated guidance on testing for fully vaccinated individuals. In the second quarter of 2021, Abbott recorded charges of $499 million under this plan in Cost of products sold. The charge recognized in the second quarter included fixed asset write-downs of $80 million, inventory-related charges of $248 million, and other exit costs, which included contract cancellations and employee-related costs of $171 million.

In the second half of 2021, as the Delta and Omicron variants of COVID-19 spread and the number of new COVID-19 cases increased significantly, particularly in the U.S., demand for rapid COVID-19 tests increased significantly. As a result, in the second half of 2021, Abbott sold approximately $181 million of inventory that was previously estimated to have no net realizable value under the second quarter of 2021 restructuring action. In addition, the estimate of other exit costs was reduced by a net $58 million as Abbott fulfilled its purchase obligations under certain contracts for which a liability was recorded in the second quarter or Abbott settled with the counterparty in the second half of 2021.

The following summarizes the activity related to this restructuring action and the status of the related accruals as of March 31, 2022:

	Inventory-
	Related		Fixed Asset		Other Exit
(in millions)	Charges		Write-Downs		Costs		Total
Restructuring charges recorded in 2021	$	248	$	80	$	113	$	441
Payments		—		—		(90)		(90)
Other non-cash		(248)		(80)		—		(328)
Accrued balance at December 31, 2021		—		—		23		23
Payments and other adjustments		—		—		(3)		(3)
Accrued balance at March 31, 2022	$	—	$	—	$	20	$	20

In 2021, Abbott management approved plans to streamline operations in order to reduce costs and improve efficiencies in Abbott’s diagnostics, established pharmaceuticals, nutritional, and medical devices businesses. Abbott recorded employee-related severance and other charges of approximately $68 million in 2021 of which approximately $16 million was recorded in Cost of products sold, approximately $4 million was recorded in Research and development, and approximately $48 million was recorded in Selling, general and administrative expense.

The following summarizes the activity for these restructurings:

(in millions)
Restructuring charges	$	68
Payments and other adjustments		(7)
Accrued balance at December 31, 2021		61
Payments and other adjustments		(16)
Accrued balance at March 31, 2022	$	45

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Incentive Stock Programs

3 Months Ended

Mar. 31, 2022

Incentive Stock Programs

Incentive Stock Programs

Note 7 — Incentive Stock Programs

In the first three months of 2022, Abbott granted 2,594,059 stock options, 514,148 restricted stock awards and 5,303,072 restricted stock units under its incentive stock program. At March 31, 2022, approximately 86 million shares were reserved for future grants. Information regarding the number of options outstanding and exercisable at March 31, 2022 is as follows:

	Outstanding		Exercisable
Number of shares		29,479,237		23,547,781
Weighted average remaining life (years)		5.9		5.1
Weighted average exercise price	$	69.87	$	59.23
Aggregate intrinsic value (in millions)	$	1,445	$	1,397

The total unrecognized share-based compensation cost at March 31, 2022 amounted to approximately $825 million which is expected to be recognized over the next three years.

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Debt and Lines of Credit

3 Months Ended

Mar. 31, 2022

Debt and Lines of Credit

Debt and Lines of Credit

Note 8 — Debt and Lines of Credit

On March 15, 2022, Abbott repaid the $750 million outstanding principal amount of its 2.55% Notes due 2022 upon maturity.

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Financial Instruments, Derivatives and Fair Value Measures

3 Months Ended

Mar. 31, 2022

Financial Instruments, Derivatives and Fair Value Measures

Financial Instruments, Derivatives and Fair Value Measures

Note 9 — Financial Instruments, Derivatives and Fair Value Measures

Certain Abbott foreign subsidiaries enter into foreign currency forward exchange contracts to manage exposures to changes in foreign exchange rates primarily for anticipated intercompany purchases by those subsidiaries whose functional currencies are not the U.S. dollar. These contracts, with gross notional amounts totaling $8.5 billion at March 31, 2022 and $8.6 billion at December 31, 2021 are designated as cash flow hedges of the variability of the cash flows due to changes in foreign exchange rates and are recorded at fair value. Accumulated gains and losses as of March 31, 2022 will be included in Cost of products sold at the time the products are sold, generally through the next twelve to eighteen months.

Abbott enters into foreign currency forward exchange contracts to manage currency exposures for foreign currency denominated third-party trade payables and receivables, and for intercompany loans and trade accounts payable where the receivable or payable is denominated in a currency other than the functional currency of the entity. For intercompany loans, the contracts require Abbott to sell or buy foreign currencies, primarily European currencies, in exchange for primarily U.S. dollars and other European currencies. For intercompany and trade payables and receivables, the currency exposures are primarily the U.S. dollar and European currencies. At March 31, 2022 and December 31, 2021, Abbott held the gross notional amount of $12.2 billion of such foreign currency forward exchange contracts.

Abbott has designated a yen-denominated, 5-year term loan of approximately $491 million and $521 million as of March 31, 2022 and December 31, 2021, respectively, as a hedge of the net investment in certain foreign subsidiaries. The change in the value of the debt, which is due to changes in foreign exchange rates, is recorded in Accumulated other comprehensive income (loss), net of tax.

Abbott is a party to interest rate hedge contracts totaling approximately $2.9 billion at March 31, 2022 and December 31, 2021 to manage its exposure to changes in the fair value of fixed-rate debt. These contracts are designated as fair value hedges of the variability of the fair value of fixed-rate debt due to changes in the long-term benchmark interest rates. The effect of the hedge is to change a fixed-rate interest obligation to a variable rate for that portion of the debt. Abbott records the contracts at fair value and adjusts the carrying amount of the fixed-rate debt by an offsetting amount.

Note 9 — Financial Instruments, Derivatives and Fair Value Measures (Continued)

The following table summarizes the amounts and location of certain derivative financial instruments as of March 31, 2022 and December 31, 2021:

	Fair Value - Assets					Fair Value - Liabilities
	March 31,		Dec. 31,			March 31,		Dec. 31,
(in millions)	2022		2021		Balance Sheet Caption	2022		2021		Balance Sheet Caption
Interest rate swaps designated as fair value hedges	$	—	$	87	Deferred income taxes and other assets	$	34	$	—	Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments		204		222	Prepaid expenses and other receivables		183		65	Other accrued liabilities
Others not designated as hedges		149		70	Prepaid expenses and other receivables		93		32	Other accrued liabilities
Debt designated as a hedge of net investment in a foreign subsidiary		—		—	n/a		491		521	Long-term debt
	$	353	$	379		$	801	$	618

The following table summarizes the activity for foreign currency forward exchange contracts designated as cash flow hedges and certain other derivative financial instruments, as well as the amounts and location of income (expense) and gain (loss) reclassified into income for the three months ended March 31, 2022 and 2021.

	Gain (loss) Recognized in				Income (expense) and
	Other Comprehensive				Gain (loss) Reclassified
	Income (loss)				into Income
(in millions)	2022		2021		2022		2021		Income Statement Caption
Foreign currency forward exchange contracts designated as cash flow hedges	$	(49)	$	134	$	27	$	(23)	Cost of products sold
Debt designated as a hedge of net investment in a foreign subsidiary		30		35		—		—	n/a
Interest rate swaps designated as fair value hedges		n/a		n/a		(121)		(69)	Interest expense

Losses of $51 million and gains of $49 million were recognized in the three months ended March 31, 2022 and 2021, respectively, related to foreign currency forward exchange contracts not designated as a hedge. These amounts are reported in the Condensed Consolidated Statement of Earnings on the Net foreign exchange (gain) loss line.

Note 9 — Financial Instruments, Derivatives and Fair Value Measures (Continued)

The carrying values and fair values of certain financial instruments as of March 31, 2022 and December 31, 2021 are shown in the following table. The carrying values of all other financial instruments approximate their estimated fair values. The counterparties to financial instruments consist of select major international financial institutions. Abbott does not expect any losses from non-performance by these counterparties.

	March 31, 2022				December 31, 2021
	Carrying		Fair		Carrying		Fair
(in millions)	Value		Value		Value		Value
Long-term Investment Securities:
Equity securities	$	703	$	703	$	748	$	748
Other		60		60		68		68
Total long-term debt		(17,090)		(18,704)		(18,050)		(21,152)
Foreign Currency Forward Exchange Contracts:
Receivable position		353		353		292		292
(Payable) position		(276)		(276)		(97)		(97)
Interest Rate Hedge Contracts:
Receivable position		—		—		87		87
(Payable) position		(34)		(34)		—		—

The fair value of the debt was determined based on significant other observable inputs, including current interest rates.

The following table summarizes the bases used to measure certain assets and liabilities at fair value on a recurring basis in the balance sheet:

			Basis of Fair Value Measurement
			Quoted		Significant
			Prices in		Other		Significant
	Outstanding		Active		Observable		Unobservable
(in millions)	Balances		Markets		Inputs		Inputs
March 31, 2022:
Equity securities	$	367	$	367	$	—	$	—
Foreign currency forward exchange contracts		353		—		353		—
Total Assets	$	720	$	367	$	353	$	—
Fair value of hedged long-term debt	$	2,805	$	—	$	2,805	$	—
Interest rate swap derivative financial instruments		34		—		34		—
Foreign currency forward exchange contracts		276		—		276		—
Contingent consideration related to business combinations		134		—		—		134
Total Liabilities	$	3,249	$	—	$	3,115	$	134
December 31, 2021:
Equity securities	$	402	$	402	$	—	$	—
Interest rate swap derivative financial instruments		87		—		87		—
Foreign currency forward exchange contracts		292		—		292		—
Total Assets	$	781	$	402	$	379	$	—
Fair value of hedged long-term debt	$	2,926	$	—	$	2,926	$	—
Foreign currency forward exchange contracts		97		—		97		—
Contingent consideration related to business combinations		130		—		—		130
Total Liabilities	$	3,153	$	—	$	3,023	$	130

Note 9 — Financial Instruments, Derivatives and Fair Value Measures (Continued)

The fair value of foreign currency forward exchange contracts is determined using a market approach, which utilizes values for comparable derivative instruments. The fair value of debt was determined based on the face value of the debt adjusted for the fair value of the interest rate swaps, which is based on a discounted cash flow analysis using significant other observable inputs. The fair value of the contingent consideration was determined based on independent appraisals at the time of acquisition, adjusted for the time value of money and other changes in fair value.

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Litigation and Environmental Matters

3 Months Ended

Mar. 31, 2022

Litigation and Environmental Matters

Litigation and Environmental Matters

Note 10 — Litigation and Environmental Matters

Abbott has been identified as a potentially responsible party for investigation and cleanup costs at a number of locations in the United States and Puerto Rico under federal and state remediation laws and is investigating potential contamination at a number of company-owned locations. Abbott has recorded an estimated cleanup cost for each site for which management believes Abbott has a probable loss exposure. No individual site cleanup exposure is expected to exceed $4 million, and the aggregate cleanup exposure is not expected to exceed $10 million.

Abbott is involved in various claims and legal proceedings, and Abbott estimates the range of possible loss for its legal proceedings and environmental exposures to be from approximately $30 million to $45 million. The recorded accrual balance at March 31, 2022 for these proceedings and exposures was approximately $40 million. This accrual represents management’s best estimate of probable loss, as defined by FASB ASC No. 450, “Contingencies.” Within the next year, legal proceedings may occur that may result in a change in the estimated loss accrued by Abbott. While it is not feasible to predict the outcome of all such proceedings and exposures with certainty, management believes that their ultimate disposition should not have a material adverse effect on Abbott’s financial position, cash flows, or results of operations.

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Post-Employment Benefits

3 Months Ended

Mar. 31, 2022

Post-Employment Benefits

Post-Employment Benefits

Note 11 — Post-Employment Benefits

Retirement plans consist of defined benefit, defined contribution, and medical and dental plans. Net periodic benefit costs, other than service costs, are recognized in the Other (income) expense, net line of the Condensed Consolidated Statement of Earnings. Net cost recognized for the three months ended March 31 for Abbott’s major defined benefit plans and post-employment medical and dental benefit plans is as follows:

	Defined Benefit Plans				Medical and Dental Plans
	March 31,		March 31,		March 31,		March 31,
(in millions)	2022		2021		2022		2021
Service cost — benefits earned during the period	$	96	$	100	$	13	$	14
Interest cost on projected benefit obligations		76		62		10		8
Expected return on plan assets		(236)		(211)		(7)		(7)
Net amortization of:
Actuarial loss, net		59		81		5		7
Prior service cost (credit)		—		—		(6)		(7)
Net cost (credit)	$	(5)	$	32	$	15	$	15

Abbott funds its domestic defined benefit plans according to Internal Revenue Service funding limitations. International pension plans are funded according to similar regulations. In the first three months of 2022 and 2021, $334 million and $16 million, respectively, were contributed to defined benefit plans. Contributions made to post-employment medical and dental plans in the first three months of 2022 were $28 million. No contributions were made to the post-employment medical and dental plans in the first three months of 2021.

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Taxes on Earnings from Continuing Operations

3 Months Ended

Mar. 31, 2022

Taxes on Earnings from Continuing Operations

Taxes on Earnings from Continuing Operations

Note 12 — Taxes on Earnings

Taxes on earnings reflect the estimated annual effective rates and include charges for interest and penalties. In the first three months of 2022 and 2021, taxes on earnings include approximately $30 million and $80 million, respectively, in excess tax benefits associated with share-based compensation. In the first three months of 2022, taxes on earnings also include approximately $30 million of tax expense as the result of the resolution of various tax positions related to prior years.

Tax authorities in various jurisdictions regularly review Abbott’s income tax filings. Abbott believes that it is reasonably possible that the recorded amount of gross unrecognized tax benefits may decrease approximately $70 million to $80 million, including cash adjustments, within the next twelve months as a result of concluding various domestic and international tax matters.

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Segment and Geographic Area Information

3 Months Ended

Mar. 31, 2022

Segment Information

Segment and Geographic Area Information

Note 13 — Segment 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, physicians’ offices and alternate-care testing sites. For segment reporting purposes, the Core Laboratory Diagnostics, Rapid Diagnostics, Molecular Diagnostics and Point of Care Diagnostics 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, Heart Failure, Vascular, Structural Heart, Neuromodulation 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.

Note 13 — Segment Information (Continued)

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

	Three Months Ended March 31
	Net Sales to				Operating
	External Customers				Earnings
(in millions)	2022		2021		2022		2021
Established Pharmaceutical Products	$	1,147	$	1,070	$	242	$	169
Nutritional Products		1,894		2,036		251		467
Diagnostic Products		5,286		4,014		2,569		1,701
Medical Devices		3,565		3,320		1,078		1,007
Total Reportable Segments		11,892		10,440		4,140		3,344
Other		3		16
Net sales	$	11,895	$	10,456
Corporate functions and benefit plans costs						(114)		(114)
Net interest expense						(117)		(124)
Share-based compensation (a)						(305)		(288)
Amortization of intangible assets						(512)		(509)
Other, net (b)						(216)		(266)
Earnings before taxes					$	2,876	$	2,043

(a) Approximately 45 percent of the annual net cost of share-based awards will typically be recognized in the first quarter due to the timing of the granting of share-based awards.

(b) Other, net for the three months ended March 31, 2022 includes $120 million of charges related to a voluntary recall within the Nutritional Products segment. Other, net for the three months ended March 31, 2021 includes net costs related to certain litigation. Other, net for the three months ended March 31, 2022 and 2021 also includes integration costs associated with the acquisitions of St. Jude Medical and Alere Inc., and restructuring charges.

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Revenue (Tables)

3 Months Ended

Mar. 31, 2022

Revenue

Schedule of reportable segment included under sales category

	Three Months Ended March 31, 2022						Three Months Ended March 31, 2021
(in millions)	U.S.		Int’l		Total		U.S.		Int’l		Total
Established Pharmaceutical Products —
Key Emerging Markets	$	—	$	902	$	902	$	—	$	821	$	821
Other		—		245		245		—		249		249
Total		—		1,147		1,147		—		1,070		1,070
Nutritionals —
Pediatric Nutritionals		338		509		847		508		558		1,066
Adult Nutritionals		339		708		1,047		328		642		970
Total		677		1,217		1,894		836		1,200		2,036
Diagnostics —
Core Laboratory		268		916		1,184		271		911		1,182
Molecular		172		248		420		175		272		447
Point of Care		91		37		128		92		37		129
Rapid Diagnostics		2,210		1,344		3,554		1,103		1,153		2,256
Total		2,741		2,545		5,286		1,641		2,373		4,014
Medical Devices —
Rhythm Management		248		276		524		241		278		519
Electrophysiology		216		269		485		179		252		431
Heart Failure		167		54		221		145		49		194
Vascular		209		410		619		219		416		635
Structural Heart		190		221		411		169		208		377
Neuromodulation		143		36		179		145		39		184
Diabetes Care		343		783		1,126		253		727		980
Total		1,516		2,049		3,565		1,351		1,969		3,320
Other		3		—		3		10		6		16
Total	$	4,937	$	6,958	$	11,895	$	3,838	$	6,618	$	10,456

Schedule of changes in contract liabilities

(in millions)
Contract Liabilities:
Balance at December 31, 2021	$	520
Unearned revenue from cash received during the period		171
Revenue recognized related to contract liability balance		(178)
Balance at March 31, 2022	$	513

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Supplemental Financial Information (Tables)

3 Months Ended

Mar. 31, 2022

Supplemental Financial Information

Summary of activity of allowance for doubtful accounts

(in millions)
Allowance for Doubtful Accounts:
Balance at December 31, 2021	$	313
Provisions/charges to income		3
Amounts charged off and other deductions		(15)
Balance at March 31, 2022	$	301

Schedule of long-term investments

	March 31,		December 31,
(in millions)	2022		2021
Long-term Investments:
Equity securities	$	703	$	748
Other		60		68
Total	$	763	$	816

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Changes in Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2022

Changes in Accumulated Other Comprehensive Income (Loss)

Schedule of changes in accumulated other comprehensive income (loss), net of income taxes

	Three Months Ended March 31
									Cumulative Gains (Losses)
	Cumulative Foreign				Net Actuarial (Losses) and				on Derivative Instruments
	Currency Translation				Prior Service (Costs) and				Designated as Cash Flow
	Adjustments				Credits				Hedges
(in millions)	2022		2021		2022		2021		2022		2021
Balance at January 1	$	(5,839)	$	(4,859)	$	(2,670)	$	(3,871)	$	135	$	(216)
Other comprehensive income (loss) before reclassifications		(106)		(536)		17		22		(34)		96
Amounts reclassified from accumulated other comprehensive income		—		—		45		63		(22)		16
Net current period comprehensive income (loss)		(106)		(536)		62		85		(56)		112
Balance at March 31	$	(5,945)	$	(5,395)	$	(2,608)	$	(3,786)	$	79	$	(104)

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Restructuring Plans (Tables)

3 Months Ended

Mar. 31, 2022

Restructuring Plans

Schedule of restructuring reserve and related cost

	Inventory-
	Related		Fixed Asset		Other Exit
(in millions)	Charges		Write-Downs		Costs		Total
Restructuring charges recorded in 2021	$	248	$	80	$	113	$	441
Payments		—		—		(90)		(90)
Other non-cash		(248)		(80)		—		(328)
Accrued balance at December 31, 2021		—		—		23		23
Payments and other adjustments		—		—		(3)		(3)
Accrued balance at March 31, 2022	$	—	$	—	$	20	$	20

Summary of restructuring activity

(in millions)
Restructuring charges	$	68
Payments and other adjustments		(7)
Accrued balance at December 31, 2021		61
Payments and other adjustments		(16)
Accrued balance at March 31, 2022	$	45

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Incentive Stock Programs (Tables)

3 Months Ended

Mar. 31, 2022

Incentive Stock Programs

Schedule of stock options outstanding and exercisable

	Outstanding		Exercisable
Number of shares		29,479,237		23,547,781
Weighted average remaining life (years)		5.9		5.1
Weighted average exercise price	$	69.87	$	59.23
Aggregate intrinsic value (in millions)	$	1,445	$	1,397

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Financial Instruments, Derivatives and Fair Value Measures (Tables)

3 Months Ended

Mar. 31, 2022

Financial Instruments, Derivatives and Fair Value Measures

Summary of the amounts and location of certain derivative financial instruments

	Fair Value - Assets					Fair Value - Liabilities
	March 31,		Dec. 31,			March 31,		Dec. 31,
(in millions)	2022		2021		Balance Sheet Caption	2022		2021		Balance Sheet Caption
Interest rate swaps designated as fair value hedges	$	—	$	87	Deferred income taxes and other assets	$	34	$	—	Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments		204		222	Prepaid expenses and other receivables		183		65	Other accrued liabilities
Others not designated as hedges		149		70	Prepaid expenses and other receivables		93		32	Other accrued liabilities
Debt designated as a hedge of net investment in a foreign subsidiary		—		—	n/a		491		521	Long-term debt
	$	353	$	379		$	801	$	618

Schedule of derivatives gain (loss) in OCI and earnings

	Gain (loss) Recognized in				Income (expense) and
	Other Comprehensive				Gain (loss) Reclassified
	Income (loss)				into Income
(in millions)	2022		2021		2022		2021		Income Statement Caption
Foreign currency forward exchange contracts designated as cash flow hedges	$	(49)	$	134	$	27	$	(23)	Cost of products sold
Debt designated as a hedge of net investment in a foreign subsidiary		30		35		—		—	n/a
Interest rate swaps designated as fair value hedges		n/a		n/a		(121)		(69)	Interest expense

Schedule of carrying values and fair values of certain financial instruments

	March 31, 2022				December 31, 2021
	Carrying		Fair		Carrying		Fair
(in millions)	Value		Value		Value		Value
Long-term Investment Securities:
Equity securities	$	703	$	703	$	748	$	748
Other		60		60		68		68
Total long-term debt		(17,090)		(18,704)		(18,050)		(21,152)
Foreign Currency Forward Exchange Contracts:
Receivable position		353		353		292		292
(Payable) position		(276)		(276)		(97)		(97)
Interest Rate Hedge Contracts:
Receivable position		—		—		87		87
(Payable) position		(34)		(34)		—		—

Schedule of assets and liabilities measured at fair value on a recurring basis

			Basis of Fair Value Measurement
			Quoted		Significant
			Prices in		Other		Significant
	Outstanding		Active		Observable		Unobservable
(in millions)	Balances		Markets		Inputs		Inputs
March 31, 2022:
Equity securities	$	367	$	367	$	—	$	—
Foreign currency forward exchange contracts		353		—		353		—
Total Assets	$	720	$	367	$	353	$	—
Fair value of hedged long-term debt	$	2,805	$	—	$	2,805	$	—
Interest rate swap derivative financial instruments		34		—		34		—
Foreign currency forward exchange contracts		276		—		276		—
Contingent consideration related to business combinations		134		—		—		134
Total Liabilities	$	3,249	$	—	$	3,115	$	134
December 31, 2021:
Equity securities	$	402	$	402	$	—	$	—
Interest rate swap derivative financial instruments		87		—		87		—
Foreign currency forward exchange contracts		292		—		292		—
Total Assets	$	781	$	402	$	379	$	—
Fair value of hedged long-term debt	$	2,926	$	—	$	2,926	$	—
Foreign currency forward exchange contracts		97		—		97		—
Contingent consideration related to business combinations		130		—		—		130
Total Liabilities	$	3,153	$	—	$	3,023	$	130

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Post-Employment Benefits (Tables)

3 Months Ended

Mar. 31, 2022

Post-Employment Benefits

Schedule of components of the net periodic benefit cost for the entity's major defined benefit plans and post-employment medical and dental benefit plans

	Defined Benefit Plans				Medical and Dental Plans
	March 31,		March 31,		March 31,		March 31,
(in millions)	2022		2021		2022		2021
Service cost — benefits earned during the period	$	96	$	100	$	13	$	14
Interest cost on projected benefit obligations		76		62		10		8
Expected return on plan assets		(236)		(211)		(7)		(7)
Net amortization of:
Actuarial loss, net		59		81		5		7
Prior service cost (credit)		—		—		(6)		(7)
Net cost (credit)	$	(5)	$	32	$	15	$	15

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Segment and Geographic Area Information (Tables)

3 Months Ended

Mar. 31, 2022

Segment Information

Schedule of segment information - net sales and operating earnings

	Three Months Ended March 31
	Net Sales to				Operating
	External Customers				Earnings
(in millions)	2022		2021		2022		2021
Established Pharmaceutical Products	$	1,147	$	1,070	$	242	$	169
Nutritional Products		1,894		2,036		251		467
Diagnostic Products		5,286		4,014		2,569		1,701
Medical Devices		3,565		3,320		1,078		1,007
Total Reportable Segments		11,892		10,440		4,140		3,344
Other		3		16
Net sales	$	11,895	$	10,456
Corporate functions and benefit plans costs						(114)		(114)
Net interest expense						(117)		(124)
Share-based compensation (a)						(305)		(288)
Amortization of intangible assets						(512)		(509)
Other, net (b)						(216)		(266)
Earnings before taxes					$	2,876	$	2,043

(a) Approximately 45 percent of the annual net cost of share-based awards will typically be recognized in the first quarter due to the timing of the granting of share-based awards.

(b) Other, net for the three months ended March 31, 2022 includes $120 million of charges related to a voluntary recall within the Nutritional Products segment. Other, net for the three months ended March 31, 2021 includes net costs related to certain litigation. Other, net for the three months ended March 31, 2022 and 2021 also includes integration costs associated with the acquisitions of St. Jude Medical and Alere Inc., and restructuring charges.

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Revenue (Details) $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($) segment	Mar. 31, 2021 USD ($) segment
Revenue
Number of reportable segments | segment	4	4
Net Sales	$ 11,895	$ 10,456
United States
Revenue
Net Sales	4,937	3,838
Int'l
Revenue
Net Sales	6,958	6,618
Established Pharmaceutical Products
Revenue
Net Sales	1,147	1,070
Established Pharmaceutical Products | Int'l
Revenue
Net Sales	1,147	1,070
Nutritional Products
Revenue
Net Sales	1,894	2,036
Nutritional Products | United States
Revenue
Net Sales	677	836
Nutritional Products | Int'l
Revenue
Net Sales	1,217	1,200
Diagnostic Products
Revenue
Net Sales	5,286	4,014
Diagnostic Products | United States
Revenue
Net Sales	2,741	1,641
Diagnostic Products | Int'l
Revenue
Net Sales	2,545	2,373
Medical Devices
Revenue
Net Sales	3,565	3,320
Medical Devices | United States
Revenue
Net Sales	1,516	1,351
Medical Devices | Int'l
Revenue
Net Sales	2,049	1,969
Other
Revenue
Net Sales	3	16
Other | United States
Revenue
Net Sales	3	10
Other | Int'l
Revenue
Net Sales		6
Key Emerging Markets | Established Pharmaceutical Products
Revenue
Net Sales	902	821
Key Emerging Markets | Established Pharmaceutical Products | Int'l
Revenue
Net Sales	902	821
Other | Established Pharmaceutical Products
Revenue
Net Sales	245	249
Other | Established Pharmaceutical Products | Int'l
Revenue
Net Sales	245	249
Pediatric Nutritionals | Nutritional Products
Revenue
Net Sales	847	1,066
Pediatric Nutritionals | Nutritional Products | United States
Revenue
Net Sales	338	508
Pediatric Nutritionals | Nutritional Products | Int'l
Revenue
Net Sales	509	558
Adult Nutritionals | Nutritional Products
Revenue
Net Sales	1,047	970
Adult Nutritionals | Nutritional Products | United States
Revenue
Net Sales	339	328
Adult Nutritionals | Nutritional Products | Int'l
Revenue
Net Sales	708	642
Core Laboratory | Diagnostic Products
Revenue
Net Sales	1,184	1,182
Core Laboratory | Diagnostic Products | United States
Revenue
Net Sales	268	271
Core Laboratory | Diagnostic Products | Int'l
Revenue
Net Sales	916	911
Molecular | Diagnostic Products
Revenue
Net Sales	420	447
Molecular | Diagnostic Products | United States
Revenue
Net Sales	172	175
Molecular | Diagnostic Products | Int'l
Revenue
Net Sales	248	272
Point of Care | Diagnostic Products
Revenue
Net Sales	128	129
Point of Care | Diagnostic Products | United States
Revenue
Net Sales	91	92
Point of Care | Diagnostic Products | Int'l
Revenue
Net Sales	37	37
Rapid Diagnostics | Diagnostic Products
Revenue
Net Sales	3,554	2,256
Rapid Diagnostics | Diagnostic Products | United States
Revenue
Net Sales	2,210	1,103
Rapid Diagnostics | Diagnostic Products | Int'l
Revenue
Net Sales	1,344	1,153
Rhythm Management | Medical Devices
Revenue
Net Sales	524	519
Rhythm Management | Medical Devices | United States
Revenue
Net Sales	248	241
Rhythm Management | Medical Devices | Int'l
Revenue
Net Sales	276	278
Electrophysiology | Medical Devices
Revenue
Net Sales	485	431
Electrophysiology | Medical Devices | United States
Revenue
Net Sales	216	179
Electrophysiology | Medical Devices | Int'l
Revenue
Net Sales	269	252
Heart Failure | Medical Devices
Revenue
Net Sales	221	194
Heart Failure | Medical Devices | United States
Revenue
Net Sales	167	145
Heart Failure | Medical Devices | Int'l
Revenue
Net Sales	54	49
Vascular | Medical Devices
Revenue
Net Sales	619	635
Vascular | Medical Devices | United States
Revenue
Net Sales	209	219
Vascular | Medical Devices | Int'l
Revenue
Net Sales	410	416
Structural Heart | Medical Devices
Revenue
Net Sales	411	377
Structural Heart | Medical Devices | United States
Revenue
Net Sales	190	169
Structural Heart | Medical Devices | Int'l
Revenue
Net Sales	221	208
Neuromodulation | Medical Devices
Revenue
Net Sales	179	184
Neuromodulation | Medical Devices | United States
Revenue
Net Sales	143	145
Neuromodulation | Medical Devices | Int'l
Revenue
Net Sales	36	39
Diabetes Care | Medical Devices
Revenue
Net Sales	1,126	980
Diabetes Care | Medical Devices | United States
Revenue
Net Sales	343	253
Diabetes Care | Medical Devices | Int'l
Revenue
Net Sales	$ 783	$ 727

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Revenue - Remaining Performance Obligations (Details) $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($)
Diagnostic Products
Remaining Performance Obligations
Remaining performance obligations	$ 3,800
Medical Devices
Remaining Performance Obligations
Remaining performance obligations	$ 428
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-04-01
Remaining Performance Obligations
Expected timing of satisfaction period (in months)	24 months
Percentage of remaining performance obligation expected to be recognized in period	60.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Remaining Performance Obligations
Expected timing of satisfaction period (in months)	12 months
Percentage of remaining performance obligation expected to be recognized in period	16.00%

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Revenue - Practical Expedient (Details)	3 Months Ended
	Mar. 31, 2022
Revenue
Practical expedient in remaining performance obligations related to contracts	true

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Revenue - Other Contract Assets and Liabilities (Details) $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($)
Contract Liabilities
Balance at beginning of period	$ 520
Unearned revenue from cash received during the period	171
Revenue recognized related to contract liability balance	(178)
Balance at end of period	$ 513

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Supplemental Financial Information - Income Statement (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Supplemental Financial Information
Net earnings allocated to common shares	$ 2,438	$ 1,785

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Supplemental Financial Information - Other, net in Net cash from operating activities (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flow disclosures
Payment of cash taxes	$ 195	$ 270
Defined Benefit Plans
Cash flow disclosures
Pension contributions	$ 334	$ 16

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Supplemental Financial Information - Allowance for Doubtful Accounts (Details) $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($)
Allowances for Doubtful Accounts and Product Returns
Balance at Beginning	$ 313
Provisions/charges to income	3
Amounts charged off and other deductions	(15)
Balance at End	$ 301

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Supplemental Financial Information - Investments (Details) - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Investments
Long-term Investments	$ 763	$ 816
Equity method investments carrying value	244
Equity investment without readily determinable fair value	92
Equity securities
Investments
Long-term Investments	703	748
Other
Investments
Long-term Investments	60	$ 68
St Jude Medical | Equity securities
Investments
Securities in mutual funds held in a rabbi trust	$ 357

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Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Changes in accumulated other comprehensive income (loss), net of income taxes
Beginning of the period	$ 35,802
Net current period comprehensive income (loss)	(100)	$ (339)
End of the period	35,399
Cumulative Foreign Currency Translation Adjustments
Changes in accumulated other comprehensive income (loss), net of income taxes
Beginning of the period	(5,839)	(4,859)
Other comprehensive income (loss) before reclassifications	(106)	(536)
Net current period comprehensive income (loss)	(106)	(536)
End of the period	(5,945)	(5,395)
Net Actuarial (Losses) and Prior Service (Costs) and Credits
Changes in accumulated other comprehensive income (loss), net of income taxes
Beginning of the period	(2,670)	(3,871)
Other comprehensive income (loss) before reclassifications	17	22
(Income) loss amounts reclassified from accumulated other comprehensive income	45	63
Net current period comprehensive income (loss)	62	85
End of the period	(2,608)	(3,786)
Cumulative Gains (Losses) on Derivative Instruments Designated as Cash Flow Hedges
Changes in accumulated other comprehensive income (loss), net of income taxes
Beginning of the period	135	(216)
Other comprehensive income (loss) before reclassifications	(34)	96
(Income) loss amounts reclassified from accumulated other comprehensive income	(22)	16
Net current period comprehensive income (loss)	(56)	112
End of the period	$ 79	$ (104)

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Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Goodwill and Intangible Assets
Goodwill	$ 23,179	$ 23,231
Decrease in goodwill from foreign currency translation adjustments	50
Amount of reductions of goodwill relating to impairments	0
Established Pharmaceutical Products
Goodwill and Intangible Assets
Goodwill	2,800
Nutritional Products
Goodwill and Intangible Assets
Goodwill	286
Diagnostic Products
Goodwill and Intangible Assets
Goodwill	3,700
Medical Devices
Goodwill and Intangible Assets
Goodwill	$ 16,400

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Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Goodwill and Intangible Assets
Gross amount of amortizable intangible assets	$ 27,700	$ 27,700
Accumulated amortization of intangible assets	16,400	15,900
Increase (Decrease) in intangible assets due to foreign currency translation adjustments	3
Estimated annual amortization expense, intangible assets, 2022	2,100
Estimated annual amortization expense, intangible assets, 2023	2,000
Estimated annual amortization expense, intangible assets, 2024	1,900
Estimated annual amortization expense, intangible assets, 2025	1,700
Estimated annual amortization expense, intangible assets, 2026	1,600
Indefinite-lived intangible assets related to in-process R&D acquired in a business combination	$ 919	$ 919

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Restructuring Plans - Diagnostic Products segment (Details) - COVID-19 Test Manufacturing Network Restructuring Plan - USD ($) $ in Millions	3 Months Ended		6 Months Ended	12 Months Ended
	Mar. 31, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2021
Restructuring Plans
Restructuring charges		$ 499		$ 441
Payments				(90)
Other non-cash				(328)
Payments and other adjustments	$ (3)
Accrued balance	20		$ 23	23
Inventory sold that was previously estimated to have no net realizable value			181
Inventory-related charges
Restructuring Plans
Restructuring charges		248		248
Other non-cash				(248)
Fixed asset write-downs
Restructuring Plans
Restructuring charges		80		80
Other non-cash				(80)
Other exit costs
Restructuring Plans
Restructuring charges		$ 171		113
Payments				(90)
Payments and other adjustments	(3)
Accrued balance	$ 20		23	$ 23
Reduction of restructuring estimate			$ 58

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Restructuring Plans - 2021 Restructuring Plan (Details) - 2021 Restructuring Plan - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Restructuring Plans
Employee related severance and other charges		$ 68
Restructuring Charges		68
Payments and other adjustments	$ (16)	(7)
Accrued balance	$ 45	61
Cost of products sold
Restructuring Plans
Employee related severance and other charges		16
Research and development
Restructuring Plans
Employee related severance and other charges		4
Selling, general and administrative expense
Restructuring Plans
Employee related severance and other charges		$ 48

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Incentive Stock Programs - General (Details)	3 Months Ended
	Mar. 31, 2022 shares
Incentive Stock Program
Incentive stock program, shares reserved for future grants	86,000,000
Stock options
Incentive Stock Program
Stock options granted during the period (in shares)	2,594,059
Restricted stock awards
Incentive Stock Program
Grants in period, restricted stock (in shares)	514,148
Restricted stock units
Incentive Stock Program
Awards and units granted during period (in shares)	5,303,072

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Incentive Stock Programs - Options (Details) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($) $ / shares shares
Incentive Stock Program
Total unrecognized compensation cost	$ 825
Total unrecognized compensation cost, recognition period	3 years
Stock options
Incentive Stock Program
Stock options outstanding, number of shares | shares	29,479,237
Exercisable options, number of shares | shares	23,547,781
Stock options outstanding, weighted-average remaining life	5 years 10 months 24 days
Exercisable options, weighted-average remaining life	5 years 1 month 6 days
Stock options outstanding, weighted-average exercise price (in dollars per share) | $ / shares	$ 69.87
Exercisable options, weighted-average exercise price (in dollars per share) | $ / shares	$ 59.23
Aggregate intrinsic value of options outstanding	$ 1,445
Aggregate intrinsic value of options exercisable	$ 1,397

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Debt and Lines of Credit (Details) - 2.55% Notes, due 2022 $ in Millions	Mar. 15, 2022 USD ($)
Debt and Lines of Credit
Repayments of debt	$ 750
Interest rate percentage	2.55%

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Financial Instruments, Derivatives and Fair Value Measures - Contracts (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Designated as hedging instrument | Yen-denominated long-term debt | Net investment hedges
Financial Instruments, Derivatives and Fair Value Measures
Term loan	$ 491	$ 521
Debt Instrument, Term	5 years	5 years
Designated as hedging instrument | Foreign currency forward exchange contracts | Cash flow hedges
Financial Instruments, Derivatives and Fair Value Measures
Gross notional amount	$ 8,500	$ 8,600
Minimum length of time over which accumulated gains and losses will be recognized in Cost of products sold	12 months
Maximum length of time over which accumulated gains and losses will be recognized in Cost of products sold	18 months
Designated as hedging instrument | Interest rate swaps | Fair value hedges
Financial Instruments, Derivatives and Fair Value Measures
Gross notional amount	$ 2,900	2,900
Not designated as hedging instrument | Foreign currency forward exchange contracts
Financial Instruments, Derivatives and Fair Value Measures
Gross notional amount	$ 12,200	$ 12,200

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Financial Instruments, Derivatives and Fair Value Measures - Location of Derivative Instruments (Details) - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Derivative instruments and fair value
Fair Value - Assets	$ 353	$ 379
Fair Value - Liabilities	801	618
Designated as hedging instrument | Interest rate swaps | Deferred income taxes and other assets | Fair value hedges
Derivative instruments and fair value
Fair Value - Assets		87
Designated as hedging instrument | Interest rate swaps | Post-employment obligations, deferred income taxes and other long-term liabilities | Fair value hedges
Derivative instruments and fair value
Fair Value - Liabilities	34
Designated as hedging instrument | Foreign currency forward exchange contracts | Prepaid expenses and other receivables
Derivative instruments and fair value
Fair Value - Assets	204	222
Designated as hedging instrument | Foreign currency forward exchange contracts | Other accrued liabilities
Derivative instruments and fair value
Fair Value - Liabilities	183	65
Designated as hedging instrument | Debt | Long-term Debt | Net investment hedges
Derivative instruments and fair value
Fair Value - Liabilities	491	521
Not designated as hedging instrument | Foreign currency forward exchange contracts | Prepaid expenses and other receivables
Derivative instruments and fair value
Fair Value - Assets	149	70
Not designated as hedging instrument | Foreign currency forward exchange contracts | Other accrued liabilities
Derivative instruments and fair value
Fair Value - Liabilities	$ 93	$ 32

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Financial Instruments, Derivatives and Fair Value Measures - Gain or Loss (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Foreign currency forward exchange contracts | Not designated as hedging instrument
Gain (loss) on derivatives
Income (expense) and Gains (loss) Reclassified into Income	$ (51)	$ 49
Foreign currency forward exchange contracts | Cash flow hedges | Designated as hedging instrument | Cost of products sold
Gain (loss) on derivatives
Gain (loss) Recognized in Other Comprehensive Income (loss)	(49)	134
Income (expense) and Gains (loss) Reclassified into Income	27	(23)
Debt | Net investment hedges | Designated as hedging instrument
Gain (loss) on derivatives
Gain (loss) Recognized in Other Comprehensive Income (loss)	30	35
Interest rate swaps | Fair value hedges | Designated as hedging instrument | Interest expense
Gain (loss) on derivatives
Income (expense) and Gains (loss) Reclassified into Income	$ (121)	$ (69)

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Financial Instruments, Derivatives and Fair Value Measures - Carrying Value and Fair Value (Details) - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Fair value, asset and liability measures
Long-term Investments	$ 763	$ 816
Equity securities
Fair value, asset and liability measures
Long-term Investments	703	748
Carrying value
Fair value, asset and liability measures
Total long-term debt	(17,090)	(18,050)
Foreign currency forward exchange contracts, receivable position	353	292
Foreign currency forward exchange contracts, (payable) position	(276)	(97)
Interest rate hedge contracts, receivable position		87
Interest rate hedge contract, (payable) position	(34)
Carrying value | Equity securities
Fair value, asset and liability measures
Long-term Investments	703	748
Carrying value | Other
Fair value, asset and liability measures
Long-term Investments	60	68
Fair value
Fair value, asset and liability measures
Total long-term debt	(18,704)	(21,152)
Foreign currency forward exchange contracts, receivable position	353	292
Foreign currency forward exchange contracts, (payable) position	(276)	(97)
Interest rate hedge contracts, receivable position		87
Interest rate hedge contract, (payable) position	(34)
Fair value | Equity securities
Fair value, asset and liability measures
Long-term Investments	703	748
Fair value | Other
Fair value, asset and liability measures
Long-term Investments	$ 60	$ 68

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Financial Instruments, Derivatives and Fair Value Measures - Bases of Measurement (Details) - Recurring - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Fair value, asset and liability measures
Equity securities	$ 367	$ 402
Interest rate swap derivative financial instruments		87
Foreign currency forward exchange contracts	353	292
Total Assets	720	781
Fair value of hedged long-term debt	2,805	2,926
Interest rate swap derivative financial instruments	34
Foreign currency forward exchange contracts	276	97
Contingent consideration related to business combinations	134	130
Total Liabilities	3,249	3,153
Quoted Prices in Active Markets
Fair value, asset and liability measures
Equity securities	367	402
Total Assets	367	402
Significant Other Observable Inputs
Fair value, asset and liability measures
Interest rate swap derivative financial instruments		87
Foreign currency forward exchange contracts	353	292
Total Assets	353	379
Fair value of hedged long-term debt	2,805	2,926
Interest rate swap derivative financial instruments	34
Foreign currency forward exchange contracts	276	97
Total Liabilities	3,115	3,023
Significant Unobservable Inputs
Fair value, asset and liability measures
Contingent consideration related to business combinations	134	130
Total Liabilities	$ 134	$ 130

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Litigation and Environmental Matters (Details) $ in Millions	Mar. 31, 2022 USD ($)
Loss Contingencies
Maximum expected cleanup exposure for individual site	$ 4
Maximum expected cleanup exposure in aggregate	10
Legal proceedings and environmental exposures
Loss Contingencies
Recorded accrual balance for legal proceedings and exposures	40
Legal proceedings and environmental exposures | Minimum
Loss Contingencies
Estimation of possible loss	30
Legal proceedings and environmental exposures | Maximum
Loss Contingencies
Estimation of possible loss	$ 45

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Post-Employment Benefits - (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Defined benefit plan net periodic benefit cost
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)
Net amortization of:
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Amortization of Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Amortization of Prior Service Cost (Credit), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)
Defined Benefit Plans
Defined benefit plan net periodic benefit cost
Service cost - benefits earned during the period	$ 96	$ 100
Interest cost on projected benefit obligations	76	62
Expected return on plans' assets	(236)	(211)
Net amortization of:
Actuarial loss, net	59	81
Total net cost (credit)	(5)	32
Post-employment Obligations and Other Long-term Liabilities:
Company contributions	334	16
Medical and Dental Plans
Defined benefit plan net periodic benefit cost
Service cost - benefits earned during the period	13	14
Interest cost on projected benefit obligations	10	8
Expected return on plans' assets	(7)	(7)
Net amortization of:
Actuarial loss, net	5	7
Prior service cost (credit)	(6)	(7)
Total net cost (credit)	15	15
Post-employment Obligations and Other Long-term Liabilities:
Company contributions	$ 28	$ 0

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Taxes on Earnings (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Taxes on Earnings
Excess tax benefits associated with share-based compensation	$ 30	$ 80
Tax expense as the result of the resolution of various tax positions related to prior years	30
Minimum
Taxes on Earnings
Decrease reasonably possible in gross unrecognized tax benefits	70
Maximum
Taxes on Earnings
Decrease reasonably possible in gross unrecognized tax benefits	$ 80

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Segment Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Segment Information
Net Sales	$ 11,895	$ 10,456
Operating Earnings	2,912	2,109
Amortization of intangible assets	(512)	(509)
Earnings before taxes	$ 2,876	$ 2,043
Annual share-based awards recognized in first quarter (as a percent)	45.00%	45.00%
Established Pharmaceutical Products
Segment Information
Net Sales	$ 1,147	$ 1,070
Nutritional Products
Segment Information
Net Sales	1,894	2,036
Voluntary recall	120
Diagnostic Products
Segment Information
Net Sales	5,286	4,014
Medical Devices
Segment Information
Net Sales	3,565	3,320
Other Segment
Segment Information
Net Sales	3	16
Total Reportable Segment Operating Earnings
Segment Information
Net Sales	11,892	10,440
Operating Earnings	4,140	3,344
Total Reportable Segment Operating Earnings | Established Pharmaceutical Products
Segment Information
Net Sales	1,147	1,070
Operating Earnings	242	169
Total Reportable Segment Operating Earnings | Nutritional Products
Segment Information
Net Sales	1,894	2,036
Operating Earnings	251	467
Total Reportable Segment Operating Earnings | Diagnostic Products
Segment Information
Net Sales	5,286	4,014
Operating Earnings	2,569	1,701
Total Reportable Segment Operating Earnings | Medical Devices
Segment Information
Net Sales	3,565	3,320
Operating Earnings	1,078	1,007
Reconciling items
Segment Information
Corporate functions and benefit plans costs	(114)	(114)
Net interest expense	(117)	(124)
Share-based compensation	(305)	(288)
Amortization of intangible assets	(512)	(509)
Other, net	$ (216)	$ (266)