Segment And Geographic Information

6 Months Ended

Jun. 30, 2012

Segments, Geographical Areas [Abstract]

Segment And Geographic Information

SEGMENT AND GEOGRAPHIC INFORMATION

Segment Information

The Company’s four operating segments are Cardiac Rhythm Management (CRM), Cardiovascular (CV), Atrial Fibrillation (AF) and Neuromodulation (NMD). The primary products produced by each operating segment are: CRM – tachycardia implantable cardioverter defibrillator systems (ICDs) and bradycardia pacemaker systems (pacemakers); CV – vascular products, which include vascular closure products, pressure measurement guidewires, optical coherence tomography (OCT) imaging products, vascular plugs and other vascular accessories, and structural heart products, which include heart valve replacement and repair products and structural heart defect devices; AF – electrophysiology (EP) introducers and catheters, advanced cardiac mapping, navigation and recording systems and ablation systems; and NMD – neurostimulation products, which include spinal cord and deep brain stimulation devices.

The Company has aggregated the four operating segments into two reportable segments based upon their similar operational and economic characteristics: CRM/NMD and CV/AF. Net sales of the Company’s reportable segments include end-customer revenues from the sale of products they each develop and manufacture or distribute. The costs included in each of the reportable segments’ operating results include the direct costs of the products sold to customers and operating expenses managed by each of the reportable segments. Certain expenses managed by the Company’s selling and corporate functions, including all stock-based compensation expense, impairment charges, certain acquisition-related charges, in-process research and development (IPR&D) charges, excise tax expense and special charges have not been recorded in the individual reportable segments. As a result, reportable segment operating profit is not representative of the operating profit of the products in these reportable segments. Additionally, certain assets are managed by the Company’s selling and corporate functions, principally including trade receivables, inventory, cash and cash equivalents, certain marketable securities and deferred income taxes. For management reporting purposes, the Company does not compile capital expenditures by reportable segment; therefore, this information has not been presented, as it is impracticable to do so.

The following table presents net sales and operating profit by reportable segment (in millions):

	CRM/NMD		CV/AF		Other			Total
Three Months ended June 30, 2012:
Net sales	$	852	$	558	$	—		$	1,410
Operating profit	567		309		(538		)	338
Three Months ended July 2, 2011:
Net sales	$	896	$	550	$	—		$	1,446
Operating profit	565		289		(529		)	325
Six Months ended June 30, 2012:
Net sales	$	1,690	$	1,115	$	—		$	2,805
Operating profit	1,124		617		(1,101		)	640
Six Months ended July 2, 2011:
Net sales	$	1,750	$	1,072	$	—		$	2,822
Operating profit	1,101		553		(1,007		)	647

The following table presents the Company’s total assets by reportable segment (in millions):

Total Assets	June 30, 2012		December 31, 2011
CRM/NMD	$	2,347	$	2,412
CV/AF	2,977		3,093
Other	3,862		3,500
	$	9,186	$	9,005

Geographic Information

The following table presents net sales by geographic location of the customer (in millions):

	Three Months Ended				Six Months Ended
Net Sales	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
United States	$	664	$	678	$	1,329	$	1,354
International
Europe	374		411		748		780
Japan	163		157		328		304
Asia Pacific	116		106		221		199
Other	93		94		179		185
	746		768		1,476		1,468
	$	1,410	$	1,446	$	2,805	$	2,822

The amounts for long-lived assets by significant geographic market include net property, plant and equipment by physical location of the asset as follows (in millions):

Long-Lived Assets	June 30, 2012		December 31, 2011
United States	$	1,036	$	1,007
International
Europe	77		84
Japan	32		31
Asia Pacific	83		81
Other	185		185
	377		381
	$	1,413	$	1,388