Segment And Geographic Information

3 Months Ended

Mar. 29, 2014

Segment Reporting [Abstract]

Segment And Geographic Information

SEGMENT AND GEOGRAPHIC INFORMATION

Segment Information

On January 28, 2014, the Company announced further organizational changes to combine its Implantable Electronic Systems Division (IESD) and Cardiovascular and Ablation Technologies Division (CATD) operating divisions, resulting in an integrated research and development organization and a consolidation of manufacturing and supply chain operations worldwide. The integration will be conducted in a phased approach throughout 2014. The Company's continuing global restructuring efforts are focused on streamlining its organization to improve productivity, reduce costs and leverage its scale to drive additional growth. The Company will continue to report under the existing reportable segment structure for internal management financial forecasting and reporting purposes into fiscal year 2014 until the organizational changes and the related financial reporting structure are finalized. The financial reporting structure has not changed as of and for the period ended March 29, 2014 and continues to be consistent with the 2013 comparable periods. As a result, IESD and CATD continue to be considered the Company's reportable segments as of March 29, 2014.

The Company's principal products are as follows: IESD – tachycardia implantable cardioverter defibrillator systems (ICDs), bradycardia pacemaker systems (pacemakers) and neurostimulation products (spinal cord and deep brain stimulation devices); and CATD – vascular products (vascular closure products, pressure measurement guidewires, optical coherence tomography (OCT) imaging products, vascular plugs and other vascular accessories), structural heart products (heart valve replacement and repair products and structural heart defect devices) and atrial fibrillation (AF) products (electrophysiology (EP) introducers and catheters, advanced cardiac mapping, navigation and recording systems and ablation systems).

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, IPR&D charges, excise tax expense, special charges and centralized support groups' operating expenses are not recorded in the IESD and CATD 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):

	IESD		CATD		Other			Total
Three Months ended March 29, 2014:
Net sales	$	786	$	577	$	—		$	1,363
Operating profit	545		352		(585		)	312
Three Months ended March 30, 2013:
Net sales	$	777	$	561	$	—		$	1,338
Operating profit	531		333		(556		)	308

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

Total Assets	March 29, 2014		December 28, 2013
IESD	$	2,844	$	2,855
CATD	3,281		3,273
Other	4,166		4,120
	$	10,291	$	10,248

Geographic Information

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

	Three Months Ended
Net Sales	March 29, 2014		March 30, 2013
United States	$	644	$	640
International
Europe	387		357
Japan	130		139
Asia Pacific	115		112
Other	87		90
	719		698
	$	1,363	$	1,338

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	March 29, 2014		December 28, 2013
United States	$	1,042	$	1,045
International
Europe	76		73
Japan	19		28
Asia Pacific	73		75
Other	189		189
	357		365
	$	1,399	$	1,410