10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JULY 2, 2016 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 Number: 1-12441

ST. JUDE MEDICAL, INC.

(Exact name of registrant as specified in its charter)

Minnesota	41-1276891
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

One St. Jude Medical Drive, St. Paul, Minnesota 55117

(Address of principal executive offices, including zip code)

(651) 756-2000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days.xYes¨No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

xYes¨No

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

Large accelerated filer x	Accelerated filer ¨
Non-accelerated filer¨(Do not check if a smaller reporting company)	Smaller reporting company¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

¨YesxNo

The number of shares of common stock, par value $0.10 per share, outstanding on July 29, 2016 was 284,929,332.

TABLE OF CONTENTS

ITEM		DESCRIPTION	PAGE
	PART I – FINANCIAL INFORMATION
1.	Financial Statements
	Condensed Consolidated Statements of Earnings		1
	Condensed Consolidated Statements of Comprehensive Income		2
	Condensed Consolidated Balance Sheets		3
	Condensed Consolidated Statements of Cash Flows		4
	Note 1 – Basis of Presentation		5
	Note 2 – Debt		7
	Note 3 – Commitments and Contingencies		8
	Note 4 – Special Charges		10
	Note 5 – Net Earnings Per Share		13
	Note 6 – Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information		13
	Note 7 – Income Taxes		16
	Note 8 – Fair Value Measurements		17
	Note 9 – Derivative Financial Instruments		21
	Note 10 – Business Combinations		25
	Note 11 – Abbott Transaction		26
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		27
	Overview		27
	Results of Operations		28
	Liquidity and Capital Resources		35
	New Accounting Pronouncements		37
	Critical Accounting Policies and Estimates		37
	Cautionary Statements		38
3.	Quantitative and Qualitative Disclosures About Market Risk		39
4.	Controls and Procedures		39
	PART II – OTHER INFORMATION
1.	Legal Proceedings		40
1A.	Risk Factors		40
2.	Unregistered Sales of Equity Securities and Use of Proceeds		40
3.	Defaults Upon Senior Securities		40
4.	Mine Safety Disclosures		40
5.	Other Information		40
6.	Exhibits		41
	Signature		42
	Index to Exhibits		43

PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

ST. JUDE MEDICAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In millions, except per share amounts)

(Unaudited)

	Three Months Ended					Six Months Ended
	July 2, 2016		July 4, 2015			July 2, 2016			July 4, 2015
Net sales	$	1,562	$	1,410		$	3,010		$	2,755
Cost of sales:
Cost of sales before special charges	490		419			974			812
Special charges	6		5			9			7
Total cost of sales	496		424			983			819
Gross profit	1,066		986			2,027			1,936
Selling, general and administrative expense	502		447			993			877
Research and development expense	192		171			380			338
Amortization of intangible assets	46		24			92			48
Special charges	13		30			21			34
Operating profit	313		314			541			639
Interest income	—		—			(1		)	(1		)
Interest expense	40		20			80			41
Other (income) expense	3		—			56			(3		)
Other expense, net	43		20			135			37
Earnings before income taxes and noncontrolling interest	270		294			406			602
Income tax expense	32		12			73			64
Net earnings before noncontrolling interest	238		282			333			538
Less: Net loss attributable to noncontrolling interest	—		(8		)	—			(14		)
Net earnings attributable to St. Jude Medical, Inc.	$	238	$	290		$	333		$	552
Net earnings per share attributable to St. Jude Medical, Inc.:
Basic	$	0.84	$	1.03		$	1.17		$	1.96
Diluted	$	0.83	$	1.02		$	1.16		$	1.93
Cash dividends declared per share:	$	0.31	$	0.29		$	0.62		$	0.58
Weighted average shares outstanding:
Basic	284.3		281.1			283.9			282.0
Diluted	288.3		285.5			287.3			286.3

The accompanying Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

1

ST. JUDE MEDICAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

(Unaudited)

	Three Months Ended						Six Months Ended
	July 2, 2016			July 4, 2015			July 2, 2016			July 4, 2015
Net earnings before noncontrolling interest	$	238		$	282		$	333		$	538
Other comprehensive income (loss), net of tax
Unrealized gain (loss) on available-for-sale securities, net of tax (expense) benefit $-, $1, $- and $1, respectively	1			(4		)	1			(3		)
Unrealized gain (loss) on derivative financial instruments, net of tax (expense) benefit of $1, $2, $16 and ($3), respectively	(4		)	(17		)	(34		)	12
Foreign currency translation adjustment	(17		)	30			31			(97		)
Other comprehensive income (loss), net of tax	(20		)	9			(2		)	(88		)
Total comprehensive income before noncontrolling interest	218			291			331			450
Total comprehensive loss attributable to noncontrolling interest	—			(8		)	—			(14		)
Total comprehensive income attributable to St. Jude Medical, Inc.	$	218		$	299		$	331		$	464

The accompanying Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

2

ST. JUDE MEDICAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except par value and share amounts)

(Unaudited)

	July 2, 2016			January 2, 2016
ASSETS
Current Assets
Cash and cash equivalents	$	398		$	667
Accounts receivable, less allowance for doubtful accounts of $46 at both July 2, 2016 and January 2, 2016	1,330			1,237
Finished goods	563			609
Work in process	105			102
Raw materials	236			198
Inventories	904			909
Other current assets	295			269
Total current assets	2,927			3,082
Property, plant and equipment, at cost	2,888			2,767
Less: Accumulated depreciation	(1,562		)	(1,447		)
Net property, plant and equipment	1,326			1,320
Goodwill	5,670			5,651
Intangible assets, net	2,146			2,226
Other assets	589			621
TOTAL ASSETS	$	12,658		$	12,900
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Current debt obligations	$	660		$	1,163
Accounts payable	242			201
Income taxes payable	—			201
Other current liabilities	811			901
Total current liabilities	1,713			2,466
Long-term debt	5,431			5,229
Other liabilities	1,233			1,163
Total liabilities	8,377			8,858
Commitments and Contingencies (Note 3)	—			—
Shareholders’ Equity
Preferred stock ($1.00 par value; 25,000,000 shares authorized; none outstanding)	—			—
Common stock ($0.10 par value; 500,000,000 shares authorized; 284,596,998 and 283,450,374 shares issued and outstanding at July 2, 2016 and January 2, 2016, respectively)	28			28
Additional paid-in capital	232			148
Retained earnings	4,368			4,211
Accumulated other comprehensive income (loss)	(347		)	(345		)
Total shareholders’ equity	4,281			4,042
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	12,658		$	12,900

The accompanying Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

3

ST. JUDE MEDICAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

Six Months Ended	July 2, 2016			July 4, 2015
OPERATING ACTIVITIES
Net earnings before noncontrolling interest	$	333		$	538
Adjustments to reconcile net earnings before noncontrolling interest to net cash from operating activities:
Depreciation of property, plant and equipment	116			108
Amortization of intangible assets	92			48
Stock-based compensation	60			37
Deferred income taxes	(29		)	(17		)
Other, net	104			(67		)
Changes in operating assets and liabilities, net of business combinations:
Accounts receivable	(63		)	(87		)
Inventories	(18		)	(53		)
Other current and noncurrent assets	(53		)	(11		)
Accounts payable and accrued expenses	43			(35		)
Income taxes payable	(122		)	(20		)
Net cash provided by operating activities	463			441
INVESTING ACTIVITIES
Purchases of property, plant and equipment	(114		)	(80		)
Business combination payments, net of cash acquired	(11		)	—
Proceeds from sale of investments	—			8
Other investing activities, net	(4		)	(4		)
Net cash used in investing activities	(129		)	(76		)
FINANCING ACTIVITIES
Proceeds from exercise of stock options and stock issued, net	22			89
Excess tax benefits from stock issued under employee stock plans	3			14
Common stock repurchased, including related costs	—			(500		)
Dividends paid	(170		)	(158		)
Issuances (payments) of commercial paper borrowings, net	(117		)	460
Proceeds from debt	500			175
Payments of debt	(726		)	(750		)
Purchase of shares from noncontrolling interest	—			(173		)
Payment of contingent consideration	(125		)	—
Other financing activities, net	—			(15		)
Net cash provided by (used in) financing activities	(613		)	(858		)
Effect of currency exchange rate changes on cash and cash equivalents	10			(39		)
Net increase (decrease) in cash and cash equivalents	(269		)	(532		)
Cash and cash equivalents at beginning of period	667			1,442
Cash and cash equivalents at end of period	$	398		$	910

The accompanying Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

4

ST. JUDE MEDICAL, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – BASIS OF PRESENTATION

Principles of Consolidation: The accompanying unaudited Condensed Consolidated Financial Statements of St. Jude Medical, Inc. (St. Jude Medical or the Company) have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (U.S. generally accepted accounting principles) for complete financial statements. In the opinion of management, these statements include all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the Company’s consolidated results of operations, financial position and cash flows. The Condensed Consolidated Balance Sheet at January 2, 2016 was derived from audited annual financial statements, but does not contain all of the footnote disclosures from the annual financial statements. Operating results for any interim period are not necessarily indicative of the results that may be expected for the full year. Preparation of the Company’s financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts in the financial statements and footnotes. Actual results could differ from those estimates. This Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and footnotes included in its Current Report on Form 8-K filed with the SEC on June 7, 2016 for the fiscal year ended January 2, 2016.

The unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries, and other entities for which St. Jude Medical has a controlling financial interest.

Effective January 1, 2016, the Company's Board of Directors appointed a new President and Chief Executive Officer whom the Company has determined to be its Chief Operating Decision Maker. During the first quarter of 2016, the Company changed its sales reporting to closely align with how it manages the business in five key areas: Traditional Cardiac Rhythm Management, Heart Failure, Atrial Fibrillation, Cardiovascular and Neuromodulation. The Company continues to operate as a single operating segment.

Reclassifications: Certain prior period amounts have been reclassified to conform to current year presentation.

Fiscal Year: We utilize a 52/53-week fiscal year ending on the Saturday nearest December 31st. Each of the three-and six month periods ended July 2, 2016 and July 4, 2015 included 13 weeks and 26 weeks, respectively.

New Accounting Pronouncements: The following table provides a description of recent accounting pronouncements adopted and those standards not yet adopted with potential for a material impact on the Company's financial statements or disclosures.

Standard	Description	Required adoption timing and approach	Impact of adoption or other significant matters
Standards recently adopted
Accounting Standards Update (ASU) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis	The standard affects both the variable interest entity and voting interest entity consolidation models.	Annual and interim periods beginning after December 15, 2015, with either retrospective or modified retrospective application permitted. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the modified retrospective method. The adoption did not have a material impact on the Company's results of operations or financial position.

5

ASU No. 2015-05, Intangibles--Goodwill and Other--Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement	The standard provides guidance to customers about how to account for cloud computing arrangements when such arrangements include software licenses.	Annual and interim periods beginning after December 15, 2015, with either prospective or retrospective application permitted. Early adoption was permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the prospective method. The adoption did not have a material impact on the Company's results of operations or financial position.
ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory	The standard requires that inventory within the scope of the guidance be measured at the lower of cost or net realizable value.	Annual and interim periods beginning after December 15, 2016, with prospective application required. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016. The adoption did not have a material impact on the Company's results of operations or financial position.
Standards not yet adopted
ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606)	The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance will supersede the current revenue recognition requirements.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.
ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date	The standard defers the effective date of ASU No. 2014-09 to annual and interim periods beginning after December 15, 2017. Early adoption is permitted only as of annual and interim reporting periods beginning after December 15, 2016.	Not applicable.	Not applicable.
ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	Among other things, the standard requires certain equity investments to be measured at fair value with changes in fair value recognized in net income, simplifies the impairment assessment of equity investments without readily determinable fair values, and eliminates certain disclosure requirements.	Annual and interim periods beginning after December 15, 2017. Early adoption of certain guidance is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.
ASU No. 2016-02, Leases (Topic 842)	Among other things, the standard requires recognition of a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position for virtually all leases where we are the lessee.	Annual and interim periods beginning after December 15, 2018, with modified retrospective application required. Early adoption is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.

6

ASU No. 2016-09, Compensation--Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	The areas for simplification in this standard involve several aspects of the accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.	Annual and interim periods beginning after December 15, 2016, with certain aspects requiring modified retrospective transition, retrospective application, and/or prospective application. Early adoption is permitted if all aspects are adopted simultaneously.	The Company is evaluating the timing of adoption and the potential impact to its results of operations, financial position and cash flows.
ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing	Among other things, the standard clarifies the principle for determining whether a good or service is “separately identifiable” from other promises in the contract and, therefore, should be accounted for separately. It also clarifies that entities are not required to identify promised goods or services that are immaterial in the context of the contract.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.

NOTE 2 – DEBT

The carrying value of the Company’s debt, including debt issuance costs, discounts or premiums consisted of the following (in millions):

	July 2, 2016		January 2, 2016
Term Loan Due 2020	$	2,368	$	2,093
2016 Senior Notes	—		500
2018 Senior Notes	497		496
2020 Senior Notes	496		496
2023 Senior Notes	892		892
2025 Senior Notes	494		494
2043 Senior Notes	690		689
Yen-denominated Senior Notes Due 2017	79		68
Yen-denominated Senior Notes Due 2020	124		106
Yen-denominated credit facilities	64		54
Commercial paper borrowings	387		504
Total debt	6,091		6,392
Less: current debt obligations	660		1,163
Long-term debt	$	5,431	$	5,229

7

Contractual maturities of the Company's debt for the next five fiscal years and thereafter, excluding any debt issuance costs, discounts or premiums, as of July 2, 2016 were as follows (in millions):

	Remainder of 2016		2017		2018		2019		2020		After 2020
Future minimum principal payments	$	453	$	272	$	598	$	227	$	2,478	$	2,100

During the first six months of 2016, the Company repaid its $500 million principal amount of 5-year, 2.500% unsecured senior notes due 2016, made net commercial paper payments of $117 million and drew the remaining $500 million of its 5-year, $2.6 billion term loan due 2020 (Term Loan Due 2020) to refinance existing indebtedness and for general corporate purposes. The Company also made quarterly principal payments totaling $59 million for the six months ended July 2, 2016 and prepaid an additional $167 million on its Term Loan Due 2020. Additionally, the Company's yen-denominated credit facility that expired in March 2016 for 3.25 billion Japanese Yen (the equivalent of $32 million as of July 2, 2016) was automatically extended for a one-year period bearing interest at Yen LIBOR plus 0.250%, and the Company's yen-denominated credit facility that expired in June 2016 for 3.25 billion Japanese Yen (the equivalent of $32 million as of July 2, 2016) was automatically extended for a one-year period bearing interest at Yen LIBOR plus 0.270%.

NOTE 3 – COMMITMENTS AND CONTINGENCIES

Securities and Other Shareholder Litigation

December 2012 Securities Litigation: On December 7, 2012, a putative securities class action lawsuit was filed in federal district court in Minnesota against the Company and an officer (collectively, the defendants) for alleged violations of the federal securities laws, on behalf of all purchasers of the publicly traded securities of the defendants between October 17, 2012 and November 20, 2012. The complaint, which sought unspecified damages and other relief as well as attorneys' fees, challenges the Company’s disclosures concerning its high voltage cardiac rhythm lead products during the purported class period. On December 10, 2012, a second putative securities class action lawsuit was filed in federal district court in Minnesota against the Company and certain officers for alleged violations of the federal securities laws, on behalf of all purchasers of the publicly traded securities of the Company between October 19, 2011 and November 20, 2012. The second complaint alleged similar claims and sought similar relief. In March 2013, the Court consolidated the two cases and appointed a lead counsel and lead plaintiff. A consolidated amended complaint was served and filed in June 2013, alleging false or misleading representations made during the class period extending from February 5, 2010 through November 7, 2012. In September 2013, the defendants filed a motion to dismiss the consolidated amended complaint. On March 10, 2014, the Court ruled on the motion to dismiss, denying the motion in part and granting the motion in part. On October 7, 2014, the lead plaintiff filed a second amended complaint. Like the original consolidated amended complaint, the plaintiffs did not assert any specific amount of compensation in the second amended complaint. The Court granted class certification on December 22, 2015. On May 24, 2016, the parties agreed to resolve the case, pending notification to class members and subject to court approval. Under the settlement, the Company agreed to make a payment of $39.25 million to resolve all of the class claims and recorded a charge of that amount during the second quarter of 2016. On July 13, 2016, the Court issued an order preliminarily approving the settlement. Concurrent with the recording of the loss, the Company also recognized probable insurance recoveries of $39.25 million.

Abbott Merger Lawsuits: On May 2, 2016, a shareholder of the Company filed a purported class action lawsuit in Ramsey County, Minnesota, captioned Silverman v. St. Jude Medical, Inc., et al., 62-CV-16-2872 alleging that the Company's directors breached their fiduciary duties in connection with the proposed merger contemplated by the Company and Abbott Laboratories (Abbott) (the Proposed Transaction). On May 26, 2016, a second action entitled Larkin v. Starks, et al., 62-CV-16-3367, was filed in the same court alleging substantially similar claims. On July 5, 2016, plaintiffs in the two actions jointly filed an Amended Shareholder class and Derivative Action Complaint (the Amended Complaint). Plaintiffs’ Amended Complaint asserts that the Company’s directors breached their fiduciary duties by conducting a flawed sale process, failing to maximize shareholder value, and publishing false or misleading disclosure materials relating to the Proposed Transaction, and that the Abbott defendants aided and abetted those breaches. The Amended Complaint asserts direct and/or derivative claims for breach of fiduciary duty, corporate waste and abuse of control under Minnesota Statute § 302A.467. Plaintiffs seek, among other things, to enjoin the Proposed Transaction and an order directing defendants to account to plaintiffs for all damages allegedly suffered by the putative class and damages allegedly incurred by the Company in connection with the Proposed Transaction. On June 30, 2016, a shareholder of the Company filed a purported class action lawsuit in the United States District Court for the District of Minnesota, captioned Rosenfeld v. St. Jude Medical, Inc., et al.,

8

16-cv-02275-WMW-FLN, alleging that the Company and its directors violated Section 14(a) of the Securities Exchange Act of 1934, SEC Rule 14a-9, and Minnesota Statute §§ 80A.68 and 80A.76, and that the Company’s directors violated Section 20(a) of the Exchange Act, by filing a Form S-4 with the SEC that contained false or misleading statements regarding the Proposed Transaction. Plaintiff seeks, among other things, to enjoin the Proposed Transaction or, if consummated, an order rescinding it or awarding actual and punitive damages to Plaintiff and the putative class.

The Company and its directors intend to vigorously defend against the allegations in these actions involving the Abbott merger. The Company believes that a material loss is remote. Refer to Note 11 for a discussion of the Proposed Transaction.

Regulatory Matters

The U.S. Food and Drug Administration (FDA) inspected the Company’s manufacturing facility in Atlanta, Georgia, where the Company manufactures its CardioMEMS™ HF system, at various times between June 8 to June 26, 2015. On July 6, 2015, the FDA issued a Form 483 identifying certain observed non-conformity with current Good Manufacturing Practice at the facility. Following the receipt of the Form 483, the Company provided written responses to the FDA detailing proposed corrective actions and immediately initiated efforts to address the FDA’s observations of non-conformity. The Company subsequently received a warning letter dated September 30, 2015 from the FDA relating to these non-conformities. Since the completion of the FDA inspection, the Company has provided and will continue to provide the FDA with regular updates. The Company has fully-integrated this former CardioMEMS standalone facility into St. Jude Medical's quality systems. During July 2016, the FDA conducted a follow-up inspection at the Atlanta facility. On July 28, 2016, the FDA issued a Form 483 identifying additional observed non-conformities with current Good Manufacturing Practice at the facility. The Company will continue to work to remediate these observations. The warning letter is specific to the Atlanta facility and does not impact any of the Company’s other manufacturing facilities. The warning letter does not identify any specific concerns regarding the performance of, or indicate the need for any field or other action regarding, the CardioMEMS™HF system product or any other St. Jude Medical product. The Company will continue manufacturing and shipping product from the Atlanta facility, and customer orders are not expected to be impacted while the Company works to resolve the FDA’s concerns. The Company takes these matters seriously, will respond timely and fully to the FDA’s requests, and believes that the FDA’s concerns will be resolved without a material impact on the Company’s financial results.

Product Warranties

The Company offers a warranty on various products, the most significant of which relate to tachycardia implantable cardioverter defibrillator (ICD) and pacemaker systems. The Company estimates the costs it expects to incur under its warranties and records a liability for such costs at the time the product is sold. Factors that affect the Company's warranty liability include the number of units sold, historical and anticipated rates of warranty claims and cost per claim. The Company regularly assesses the adequacy of its warranty liabilities and adjusts the amounts as necessary.

Changes in the Company’s product warranty liability during the three and six months ended July 2, 2016 and July 4, 2015 were as follows (in millions):

	Three Months Ended						Six Months Ended
	July 2, 2016			July 4, 2015			July 2, 2016			July 4, 2015
Balance at beginning of period	$	26		$	32		$	31		$	35
Warranty expense (benefit) recognized	2			(2		)	1			(4		)
Warranty credits issued	(3		)	(1		)	(7		)	(2		)
Balance at end of period	$	25		$	29		$	25		$	29

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NOTE 4 – SPECIAL CHARGES

The Company recognizes certain transactions and events as special charges in its Condensed Consolidated Financial Statements. These charges (such as restructuring charges, impairment charges, certain legal settlements or product field action costs and litigation costs) result from facts and circumstances that vary in frequency and impact on the Company's results of operations.

2016 Initiatives

During the fourth quarter of 2015, the Company initiated restructuring activities to drive cross-functional synergies (the 2016 Initiatives). The 2016 Initiatives include enhancing focus on programs that will strengthen its strategic objectives, driving productivity enhancements and incurring costs to fully integrate its recent acquisitions. During 2015, the Company incurred charges of $34 million primarily related to severance and other termination benefits.

During the first quarter of 2016, the Company incurred additional charges of $24 million related to severance and other termination benefits, contract termination costs and fixed asset write-offs, primarily associated with the closure of legacy Thoratec Corporation (Thoratec) facilities as the Company continues to integrate the acquisition.

During the second quarter of 2016, the Company incurred additional charges of $12 million related to severance and other termination benefits, distributor contract terminations and other Thoratec-related contract terminations. The Company currently expects to incur approximately $20 million to $25 million during the remainder of 2016 to complete the plan, but may incur additional charges in future periods.

A summary of the activity related to the 2016 Initiatives accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	—		$	—		$	—		$	—		$	—
Cost of sales special charges	9			1			1			1			12
Special charges	22			—			—			—			22
Non-cash charges used	—			(1		)	(1		)	—			(2		)
Cash payments	(2		)	—			—			(1		)	(3		)
Balance at January 2, 2016	29			—			—			—			29
Cost of sales special charges	—			2			1			1			4
Special charges	11			—			4			5			20
Non-cash charges used	—			(2		)	(5		)	—			(7		)
Cash payments	(32		)	—			—			(5		)	(37		)
Balance at April 2, 2016	8			—			—			1			9
Cost of sales special charges	—			—			—			2			2
Special charges	6			—			—			4			10
Cash payments	(6		)	—			—			(4		)	(10		)
Balance at July 2, 2016	$	8		$	—		$	—		$	3		$	11

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Manufacturing and Supply Chain Optimization Plan

During 2014, the Company initiated the Manufacturing and Supply Chain Optimization Plan to leverage economies of scale, streamline distribution methods, drive process improvements through global synergies, balance plant utilization levels, centralize certain vendor relationships and reduce overall costs. During 2015, the Company incurred charges of $78 million primarily related to severance and other termination benefits, contract termination costs and fixed asset write-offs. These costs included charges associated with the elimination of certain operational, quality and hardware development activities at a research and development facility, continued exit costs related to a facility closure in the United States and software development assets no longer expected to be utilized.

During the first and second quarters of 2016, the Company incurred additional charges of $1 million and $2 million, respectively, primarily related to continued exit costs associated with a facility closure in the United States. Material charges are not expected in future periods as the Manufacturing and Supply Chain Optimization Plan is now complete.

A summary of the activity related to the Manufacturing and Supply Chain Optimization Plan accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	14		$	—		$	—		$	6		$	20
Cost of sales special charges	4			3			15			7			29
Special charges	20			—			—			29			49
Non-cash charges used	—			(3		)	(15		)	—			(18		)
Cash payments	(27		)	—			—			(35		)	(62		)
Balance at January 2, 2016	11			—			—			6			17
Cost of sales special charges	—			—			—			1			1
Cash payments	(3		)	—			—			(6		)	(9		)
Balance at April 2, 2016	8			—			—			1			9
Cost of sales special charges	—			—			—			1			1
Special charges	—			—			—			1			1
Cash payments	(3		)	—			—			(2		)	(5		)
Balance at July 2, 2016	$	5		$	—		$	—		$	1		$	6

2012 Business Realignment Plan

During 2012, the Company realigned its product divisions into two new operating divisions: the Implantable Electronic Systems Division (combining its legacy Cardiac Rhythm Management and Neuromodulation product divisions) and the Cardiovascular and Ablation Technologies Division (combining its legacy Cardiovascular and Atrial Fibrillation product divisions). In addition, the Company centralized certain support functions, including information technology, human resources, legal, business development and certain marketing functions. The organizational changes have been part of a comprehensive plan to accelerate the Company's growth, reduce costs, leverage economies of scale and increase investment in product development. During 2014, the Company announced additional organizational changes including the combination of its Implantable Electronic Systems Division and Cardiovascular and Ablation Technologies Division, resulting in an integrated research and development (R&D) organization and a consolidation of manufacturing and supply chain operations worldwide.

During 2015, the Company incurred additional charges of $14 million primarily related to severance and other termination benefits and other restructuring costs, including contract termination costs, asset relocation expenses and other exit costs predominately associated with the facility closure in Europe.

During the first quarter of 2016, the Company reassessed the remaining accrual balance and determined that some of the previously recorded accrual balances were no longer necessary. No additional charges are expected in future periods as the 2012 Business Realignment Plan is now complete.

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A summary of the activity related to the 2012 Business Realignment Plan accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	26		$	—		$	—		$	12		$	38
Cost of sales special charges	2			3			—			—			5
Special charges	2			—			2			5			9
Non-cash charges used	—			(3		)	(2		)	—			(5		)
Cash payments	(25		)	—			—			(10		)	(35		)
Foreign exchange rate impact	(2		)	—			—			—			(2		)
Balance at January 2, 2016	3			—			—			7			10
Cost of sales special charges	—			(1		)	—			(1		)	(2		)
Non-cash charges used	—			1			—			—			1
Balance at April 2, 2016	3			—			—			6			9
Cash payments	(1		)	—			—			—			(1		)
Balance at July 2, 2016	$	2		$	—		$	—		$	6		$	8

Other Special Charges

Legal settlements: During the first quarter of 2016, the Company recognized $19 million of legal settlement gains related to two separate legal cases. These gains were partially offset by a $2 million contingent loss related to a litigation matter that the Company now believes is probable and estimable.

During the second quarter of 2016, the Company recognized a $39.25 million legal settlement loss related to the December 2012 Securities Litigation. Concurrent with the recording of the loss, the Company also recognized probable insurance recoveries of $39.25 million (see Note 3). The Company also recognized a $2 million legal settlement gain related to a separate legal case during the second quarter of 2016.

During the first quarter of 2015, the Company recognized $10 million in insurance recoveries as a special benefit in connection with the March 2010 Securities Class Action Litigation.

Product field action costs and litigation costs: During both the first and second quarters of 2016, the Company recognized approximately $3 million of litigation charges for expected future probable and estimable legal costs associated with outstanding legal matters related to the Company's product field actions. During the first and second quarters of 2015, the Company recognized approximately $5 million and $3 million, respectively, of litigation charges for expected future probable and estimable legal costs associated with outstanding legal matters related to the Company's product field actions. Charges in excess of the amounts accrued are reasonably possible and depend on a number of factors, such as the type of claims received and the cost to defend.

During the second quarter of 2016, the Company initiated an advisory letter to physicians for patients implanted with certain ICD devices that were identified as having a potential therapy anomaly resulting in a lack of necessary treatment. As a result, the Company recognized charges of $5 million to cost of sales special charges primarily for estimated scrapped inventory and warranty costs. Partially offsetting these charges, the Company recognized a $2 million benefit during the second quarter of 2016 to cost of sales special charges for salvaged inventory components related to an advisory action initiated in 2014. Additionally, the Company recognized a $2 million benefit in both the first and second quarters of 2015 to cost of sales special charges, for salvaged inventory components related to the same advisory action initiated in 2014.

Other restructuring-related charges: The Company also recognized other restructuring-related charges of $2 million and $1 million during the first and second quarters of 2016, respectively.

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NOTE 5 – NET EARNINGS PER SHARE

The table below sets forth the computation of basic and diluted net earnings per share attributable to St. Jude Medical, Inc. (in millions, except per share amounts):

	Three Months Ended				Six Months Ended
	July 2, 2016		July 4, 2015		July 2, 2016		July 4, 2015
Numerator:
Net earnings attributable to St. Jude Medical, Inc.	$	238	$	290	$	333	$	552
Denominator:
Basic weighted average shares outstanding	284.3		281.1		283.9		282.0
Dilution associated with stock-based compensation plans	4.0		4.4		3.4		4.3
Diluted weighted average shares outstanding	288.3		285.5		287.3		286.3
Basic net earnings per share attributable to St. Jude Medical, Inc.	$	0.84	$	1.03	$	1.17	$	1.96
Diluted net earnings per share attributable to St. Jude Medical, Inc.	$	0.83	$	1.02	$	1.16	$	1.93
Anti-dilutive shares of common stock excluded from diluted net earnings per share attributable to St. Jude Medical, Inc.	3.8		2.6		6.1		3.4

NOTE 6 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) AND SUPPLEMENTAL EQUITY INFORMATION

The tables below present the changes in each component of accumulated other comprehensive income, net of tax, including other comprehensive income and reclassifications out of accumulated other comprehensive income into net earnings for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the three months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 2, 2016	$	3	$	(19	)	$	(311	)	$	(327	)
Other comprehensive income (loss) before reclassifications	1		(4		)	(17		)	(20		)
Amounts reclassified to net earnings from accumulated other comprehensive income	—		—			—			—
Other comprehensive income (loss)	1		(4		)	(17		)	(20		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

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	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the six months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of January 2, 2016	$	3	$	11		$	(359	)	$	(345	)
Other comprehensive income (loss) before reclassifications	1		(30		)	31			2
Amounts reclassified to net earnings from accumulated other comprehensive income	—		(4		)	—			(4		)
Other comprehensive income (loss)	1		(34		)	31			(2		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

	Unrealized
	Gain (Loss) On			Unrealized			Foreign			Accumulated
	Available-for-			Gain (Loss) On			Currency			Other
For the three months ended July 4, 2015	sale Securities			Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 4, 2015	$	16		$	32		$	(318	)	$	(270	)
Other comprehensive income (loss) before reclassifications	(2		)	(13		)	30			15
Amounts reclassified to net earnings from accumulated other comprehensive income	(2		)	(4		)	—			(6		)
Other comprehensive income (loss)	(4		)	(17		)	30			9
Accumulated other comprehensive income (loss) as of July 4, 2015	$	12		$	15		$	(288	)	$	(261	)
	Unrealized
	Gain (Loss) On			Unrealized			Foreign			Accumulated
	Available-for-			Gain (Loss) On			Currency			Other
For the six months ended July 4, 2015	sale Securities			Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of January 3, 2015	$	15		$	3		$	(191	)	$	(173	)
Other comprehensive income (loss) before reclassifications	1			16			(97		)	(80		)
Amounts reclassified to net earnings from accumulated other comprehensive income	(4		)	(4		)	—			(8		)
Other comprehensive income (loss)	(3		)	12			(97		)	(88		)
Accumulated other comprehensive income (loss) as of July 4, 2015	$	12		$	15		$	(288	)	$	(261	)

Income taxes are not provided for foreign translation related to permanent investments in international subsidiaries. Reclassification adjustments are made to avoid double counting items in comprehensive income that are also recorded as part of net earnings.

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The following table provides details about reclassifications out of accumulated other comprehensive income and the line items impacted in the Company's Condensed Consolidated Statements of Earnings during the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

Details about	Amount reclassified from accumulated other comprehensive income
accumulated other	Three Months Ended					Six Months Ended
comprehensive income components	July 2, 2016		July 4, 2015			July 2, 2016			July 4, 2015			Statements of Earnings Classification
Unrealized (gain) loss on available-for-sale securities:
(Gain) loss on sale of available-for-sale securities	$	—	$	(3	)	$	—		$	(7	)	Other (income) expense
Tax effect	—		1			—			3			Income tax expense
Net of tax	$	—	$	(2	)	$	—		$	(4	)
Unrealized (gain) loss on derivative financial instruments:
(Gain) loss recognized on derivative financial instruments	$	—	$	(4	)	$	(6	)	$	(4	)	Cost of sales
Tax effect	—		—			2			—			Income tax expense
Net of tax	$	—	$	(4	)	$	(4	)	$	(4	)

The Company's realized (gains) and losses on its available-for-sales securities and derivative financial instruments are computed using the specific identification method.

Supplemental Equity Information

On May 4, 2016, the Company's Board of Directors authorized a cash dividend of $0.31 per share which was paid on July 29, 2016 to shareholders of record as of June 30, 2016.

On January 13, 2015, the Company authorized a share repurchase program of up to $500 million of its outstanding common stock. The Company began repurchasing shares on January 30, 2015. From January 30, 2015 through March 2, 2015, the Company repurchased approximately 7.5 million shares for $500 million at an average repurchase price of $66.96 per share.

In June 2013, the Company made an equity investment of $40 million in Spinal Modulation, a privately-held company that is focused on the development of an intraspinal neuromodulation therapy that delivers spinal cord stimulation targeting the dorsal root ganglion to manage chronic pain. The investment agreement resulted in a 19% voting equity interest and provided the Company with the exclusive right, but not the obligation, to acquire Spinal Modulation. Additionally, in connection with the investment and contingent acquisition agreement, the Company also entered into an exclusive international distribution agreement, and obtained significant decision-making rights over Spinal Modulation's operations and economic performance. Accordingly, effective June 7, 2013, the Company determined that Spinal Modulation was a variable interest entity for which St. Jude Medical was the primary beneficiary with the financial condition and results of operations of Spinal Modulation included in St. Jude Medical's Condensed Consolidated Financial Statements.

During the second quarter of 2015, the Company exercised its exclusive option and paid $173 million to Spinal Modulation’s shareholders to acquire the remaining 81% ownership interest in the company that it did not previously own and accrued $155 million of contingent consideration (see Note 8). The $173 millionpaid in the second quarter of 2015 was classified as a financing activity in the Condensed Consolidated Statement of Cash Flows. As the Company retained its controlling interest, the payment for the shares and the accrual for contingent consideration resulted in a decrease in shareholders' equity before noncontrolling interest of $297 million and a decrease in noncontrolling interest of $33 million in St. Jude Medical's Condensed Consolidated Balance Sheets. Spinal Modulation's results of operations continue to be included in the Company's Condensed Consolidated Financial Statements.

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The supplemental equity schedules below present changes in the Company's noncontrolling interest and total shareholders' equity for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Total
	Shareholders'
	Equity
	Before					Total
	Noncontrolling			Noncontrolling		Shareholders'
For the six months ended July 2, 2016	Interest			Interest		Equity
Balance at January 2, 2016	$	4,042		$	—	$	4,042
Net earnings	333			—		333
Other comprehensive income (loss)	(2		)	—		(2		)
Cash dividends declared	(176		)	—		(176		)
Stock-based compensation	60			—		60
Common stock issued under employee stock plans and other, net	22			—		22
Tax benefit from stock plans	2			—		2
Balance at July 2, 2016	$	4,281		$	—	$	4,281

	Total
	Shareholders'
	Equity
	Before						Total
	Noncontrolling			Noncontrolling			Shareholders'
For the six months ended July 4, 2015	Interest			Interest			Equity
Balance at January 3, 2015	$	4,199		$	45		$	4,244
Net earnings	552			(14		)	538
Other comprehensive income (loss)	(88		)	—			(88		)
Cash dividends declared	(163		)	—			(163		)
Repurchases of common stock	(500		)	—			(500		)
Stock-based compensation	35			2			37
Common stock issued under employee stock plans and other, net	89			—			89
Tax benefit from stock plans	14			—			14
Additions (purchases) of noncontrolling ownership interests	(297		)	(33		)	(330		)
Balance at July 4, 2015	$	3,841		$	—		$	3,841

NOTE 7 – INCOME TAXES

As of July 2, 2016, the Company had $405 million accrued for uncertain tax positions, all of which would affect the Company’s effective tax rate if recognized. Additionally, the Company had $56 million accrued for gross interest and penalties as of July 2, 2016. At January 2, 2016, the liability for uncertain tax positions was $338 million and the accrual for gross interest and penalties was $58 million.

The Company is subject to U.S. federal income tax as well as income tax of multiple state and foreign jurisdictions. The Company has substantially concluded all material U.S. federal, state, foreign and local income tax matters for all tax years through 2004. In April 2015, the U.S. Internal Revenue Service (IRS) completed an audit of the Company’s 2010 and 2011 tax returns and proposed adjustments in an audit report. In February 2014, the IRS completed an audit of the Company’s 2008 and 2009 tax returns and also proposed adjustments in an audit report.

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The Company's effective income tax rate was 11.9% and 4.1% for the second quarter of 2016 and 2015, respectively, and 18.0% and 10.6% for the six months ended during 2016 and 2015, respectively. The Company’s effective income tax rate differs from the U.S. federal statutory rate each year due to certain operations that are subject to tax incentives, state and local taxes and foreign taxes that are different than the U.S. federal statutory rate. In addition, the effective tax rate can be impacted each period by discrete income tax factors and events. During the three months ended July 2, 2016, special charges, acquisition-related costs and discrete income tax items favorably impacted the effective income tax rate by 1.5 percentage points. During the six months ended July 2, 2016, special charges, acquisition-related costs, other-than-temporary impairments and discrete income tax items unfavorably impacted the effective income tax rate by 5.1 percentage points. Special charges, acquisition-related costs and discrete income tax items recognized during the second quarter and first six months of 2015 favorably impacted the effective rate by 13.2 percentage points and 6.5 percentage points, respectively.

During the first quarter of 2016, the European Commission concluded that decisions by the tax authorities in Belgium regarding corporate income taxes paid under certain excess profit rulings, including the ruling previously granted to one of the Company’s subsidiaries, did not comply with European Union rules on state aid. Based on the applicability of this conclusion to the Company's 2009 through 2014 tax returns in Belgium, the Company recorded a liability of 46 million Euros including interest during the first quarter of 2016 to reserve for this uncertain tax position. During the second quarter of 2016, the Company revised the estimated liability to 43 million Euros ($48 million as of July 2, 2016) including interest.

NOTE 8 – FAIR VALUE MEASUREMENTS

The fair value measurement standard applies to certain financial assets and liabilities that are measured at fair value on a recurring basis (each reporting period) and certain financial assets and liabilities that are measured at fair value on a nonrecurring basis. The Company also maintains other financial instruments that approximate their fair value due to their short maturities, and include such instruments as its cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and current and long-term debt obligations.

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

The Company's financial assets and liabilities that are measured at fair value on a recurring basis include money-market securities, available-for-sale marketable securities, trading marketable securities, derivative instruments and contingent consideration liabilities. The Company does not have any material nonfinancial assets or liabilities that are measured at fair value on a recurring basis. A summary of the valuation methodologies used for the respective financial assets and liabilities measured at fair value on a recurring basis is as follows:

Money-market securities: The Company’s money-market securities include funds that are traded in active markets and are recorded at fair value based upon the quoted market prices. The Company classifies these securities as level 1.

Available-for-sale securities: The Company’s available-for-sale securities include publicly-traded equity securities that are traded in active markets and are recorded at fair value based upon the closing stock prices. The Company classifies these securities as level 1.

The following table summarizes the components of the balance of the Company’s available-for-sale securities at July 2, 2016 and January 2, 2016 (in millions):

	July 2, 2016		January 2, 2016
Adjusted cost	$	5	$	5
Gross unrealized gains	6		6
Gross unrealized losses	—		(1		)
Fair value	$	11	$	10

Trading securities: The Company’s trading securities include publicly-traded mutual funds that are traded in active markets and are recorded at fair value based upon quoted market prices of the net asset values of the funds. The Company classifies these securities as level 1.

Derivative instruments: Fair values for the Company’s derivative financial instruments are based on quoted market prices of comparable instruments, if available, or more commonly on standard pricing models that use readily observable market parameters from industry standard data providers as their basis. These models reflect

17

contractual terms of the derivatives, including period to maturity and market-based parameters such as foreign currency exchange rates. They do not contain a high level of subjectivity as the techniques used in the models do not require significant judgment and inputs are readily observable from actively quoted markets. The Company classifies these instruments as level 2 (see Note 9).

Contingent consideration liabilities: The fair value of the Company's contingent liabilities is initially measured based on the consideration expected to be transferred (probability-weighted), discounted back to present value. The discount rate used is determined at the time of measurement in accordance with accepted valuation methods. The Company measures the liability on a recurring basis using Level 3 inputs including regulatory approval timing, projected revenues or cash flows, growth rates, discount rates, probabilities of payment and projected payment dates. Projected revenues are based on the Company's most recent internal operating budgets and long-term strategic plans. Changes to any of the inputs may result in significantly higher or lower fair value measurements.

A summary of assets and liabilities measured at fair value on a recurring basis at July 2, 2016 and January 2, 2016 is as follows (in millions):

	Balance Sheet Classification	July 2, 2016		Quoted Prices In Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money-market securities	Cash and cash equivalents	$	52	$	52	$	—	$	—
Available-for-sale      securities	Other current assets	11		11		—		—
Foreign currency forward contracts	Other current assets	4		—		4		—
Trading securities	Other assets	312		312		—		—
Foreign currency forward      contracts	Other assets	1		—		1		—
Total assets		$	380	$	375	$	5	$	—
Liabilities
Foreign currency forward contracts	Other current liabilities	$	34	$	—	$	34	$	—
Contingent consideration	Other liabilities	31		—		—		31
Foreign currency forward contracts	Other liabilities	5		—		5		—
Total liabilities		$	70	$	—	$	39	$	31

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	Balance Sheet Classification	January 2, 2016		Quoted Prices In Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money-market securities	Cash and cash equivalents	$	273	$	273	$	—	$	—
Available-for-sale    securities	Other current assets	10		10		—		—
Foreign currency forward contracts	Other current assets	14		—		14		—
Trading securities	Other assets	302		302		—		—
Foreign currency forward contracts	Other assets	2		—		2		—
Total assets		$	601	$	585	$	16	$	—
Liabilities
Contingent consideration	Other current liabilities	$	118	$	—	$	—	$	118
Foreign currency forward contracts	Other current liabilities	6		—		6		—
Contingent consideration	Other liabilities	33		—		—		33
Foreign currency forward contracts	Other liabilities	3		—		3		—
Total liabilities		$	160	$	—	$	9	$	151

The recurring Level 3 fair value measurements of the Company's contingent consideration liabilities include the following significant unobservable inputs (in millions):

Contingent Consideration Liabilities	Fair Value as of July 2, 2016		Valuation Technique	Unobservable Input	Value or Range
Spinal Modulation revenue-based milestones and earn-outs	$	2	Monte Carlo Simulation	Discount Rates	0.6%	-	15.5%
				Expected Revenue Volatility			25.0%
				Projected Years of Payments	2017, 2018
Nanostim, Inc. (Nanostim) revenue-based milestones	2		Probability Weighted Discounted Cash Flow	Discount Rate			5.0%
				Probability of Payments			10.0%
				Projected Years of Payments	2017, 2018
Assumed from Thoratec regulatory-based and revenue-based milestones	27		Probability Weighted Discounted Cash Flow	Discount Rate			4.4%
				Probabilities of Payments	—%	-	90.0%
				Projected Years of Payments	2018	-	2022
Total contingent consideration liabilities	$	31

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Additionally, the following table provides a reconciliation of the beginning and ending balances of the Company's recurring Level 3 fair value measurements (in millions):

	Nanostim			Spinal Modulation			Assumed from Thoratec			Total
Balance as of January 3, 2015	$	50		$	—		$	—		$	50
Initial fair value measurement of contingent consideration	—			155			—			155
Liabilities assumed from Thoratec acquisition	—			—			33			33
Change in fair value of contingent consideration	(48		)	(33		)	(6		)	(87		)
Balance as of January 2, 2016	2			122			27			151
Change in fair value of contingent consideration	—			8			1			9
Transfer out of Level 3 fair value measurement due to contractual settlement	—			(124		)	—			(124		)
Balance as of April 2, 2016	2			6			28			36
Change in fair value of contingent consideration	—			(4		)	(1		)	(5		)
Balance as of July 2, 2016	$	2		$	2		$	27		$	31

Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis

Disclosures are required for certain assets and liabilities that are measured at fair value but are recognized and disclosed at fair value on a nonrecurring basis in periods subsequent to initial recognition. For St. Jude Medical, such measurements of fair value primarily relate to long-lived assets, goodwill, indefinite-lived intangible assets and cost method investments.

Other than the items discussed below, there were no other material impairments that were measured at fair value on a nonrecurring basis for the three and six months ended July 2, 2016 or July 4, 2015.

Long-lived assets: During the first quarter of 2016, the Company recognized $5 million of fixed asset write-offs primarily associated with projects abandoned as the Company continues to integrate its recent acquisitions. Additionally, during the first quarter of 2015, the Company recognized $1 million of fixed asset write-offs primarily related to projects abandoned under the realigned structure. Typically the Company measures these assets using independent appraisals, market models and discounted cash flow models. However, as these fixed assets had no alternative future use and therefore no discrete future cash flows, the assets were fully impaired.

Cost method investments: The Company also holds investments in equity securities that are accounted for as cost method investments, which are classified as other assets and measured at fair value on a nonrecurring basis. The carrying value of these investments was $59 million and $80 million as of July 2, 2016 and January 2, 2016, respectively. During the first quarter of 2016, the Company concluded that adverse regulatory rulings and subsequent operational decisions made by an entity in which the Company had strategic debt and equity investments had an adverse impact on the fair values of those investments. As a result, the Company recognized other-than-temporary impairments of approximately $50 million in other (income) expense in the Condensed Consolidated Statements of Earnings to fully write-down its cost method equity investment and convertible debt investment. The fair value of the Company’s remaining cost method investments was not estimated during the three and six months ended July 2, 2016 since there were no other identified events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments.

Fair Value Measurements of Other Financial Instruments

The aggregate fair value of the Company’s fixed-rate senior notes at July 2, 2016 (measured using quoted prices in active markets) was $3,470 million compared to the aggregate carrying value of $3,272 million (inclusive of unamortized debt discounts). The fair value of the Company’s variable-rate debt obligations at July 2, 2016 approximated its aggregate $2,819 million carrying value due to the variable interest rate and short-term nature of these instruments. The Company also had $346 million and $393 million of cash equivalents invested in short-term deposits and interest and non-interest bearing bank accounts at July 2, 2016 and January 2, 2016, respectively, the cost basis of which approximated the fair value.

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NOTE 9 – DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses foreign currency forward contracts, interest rate swaps and interest rate contracts to manage risks generally associated with foreign exchange rate and interest rate fluctuations. The information that follows explains the various types of derivatives financial instruments and how they impacted the Company's financial position and performance.

Cash Flow Hedges

Foreign exchange forward contracts: During 2015, the Company began to enter into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies. These transactions are designated as cash flow hedges. The Company hedges its exposure to the variability in future cash flows of forecasted transactions for periods of up to 24 months. The dollar equivalent gross notional amount of the Company’s foreign exchange forward contracts designated as cash flow hedges at July 2, 2016 was approximately $1.0 billion. Hedge ineffectiveness recognized in earnings on cash flow hedges during the three and six months ended July 2, 2016 and July 4, 2015 was not material.

As of July 2, 2016, the Company had a balance of $27 million associated with the after-tax net unrealized loss position related to foreign currency forward contracts recorded in accumulated other comprehensive income. Based on exchange rates as of July 2, 2016, the Company expects to reclassify net losses of approximately $19 million after-tax to earnings over the next 12 months contemporaneously with the earnings effects of the related forecasted transactions (with the impact offset by cash flows from the underlying hedged items).

The following table provides the (gains) losses related to derivative instruments designated as cash flow hedges for the three and six months ended July 2, 2016 and July 4, 2015, including the location in the Condensed Consolidated Statements of Earnings and the Condensed Consolidated Statements of Comprehensive Income (in millions):

			Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss		in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other		of Derivative as a Result of				and Amount Excluded from
Three	Comprehensive		Reclassification from				Effectiveness Testing
months	Income on Effective		Accumulated Other				Recognized
ended	Portion of Derivative		Comprehensive Income				in Earnings
July 2, 2016	Amount		Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	5	$	—		Cost of sales	$	—	Cost of sales
			Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss		in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other		of Derivative as a Result of				and Amount Excluded from
Six	Comprehensive		Reclassification from				Effectiveness Testing
months	Income on Effective		Accumulated Other				Recognized
ended	Portion of Derivative		Comprehensive Income				in Earnings
July 2, 2016	Amount		Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	44	$	(6	)	Cost of sales	$	—	Cost of sales

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				Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss			in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other			of Derivative as a Result of				and Amount Excluded from
Three	Comprehensive			Reclassification from				Effectiveness Testing
months	Income on Effective			Accumulated Other				Recognized
ended	Portion of Derivative			Comprehensive Income				in Earnings
July 4, 2015	Amount			Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	15		$	(4	)	Cost of sales	$	—	Cost of sales
				Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss			in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other			of Derivative as a Result of				and Amount Excluded from
Six	Comprehensive			Reclassification from				Effectiveness Testing
months	Income on Effective			Accumulated Other				Recognized
ended	Portion of Derivative			Comprehensive Income				in Earnings
July 4, 2015	Amount			Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	(19	)	$	(4	)	Cost of sales	$	—	Cost of sales

Reclassifications from accumulated other comprehensive income into earnings include accumulated (gains) losses on dedesignated hedges at the time earnings are impacted.

Derivatives Not Designated as Hedging Instruments

Derivatives not designated as hedging instruments include dedesignated foreign currency forward contracts and foreign currency forward contracts that the Company utilizes to economically hedge the foreign currency impact of assets and liabilities denominated in nonfunctional currencies. The dollar equivalent gross notional amount of these forward contracts not designated as hedging instruments totaled approximately $0.2 billion as of July 2, 2016. The fair value of the Company's outstanding contracts was not material as of July 2, 2016 and January 2, 2016.

The following table provides the (gains) losses related to derivative instruments not designated as hedging instruments, including the location in the Condensed Consolidated Statements of Earnings (in millions):

Derivatives Not	(Gain) Loss on Derivatives					(Gain) Loss on Derivatives
Designated as	Recognized in Earnings					Recognized in Earnings
Hedging	Three Months Ended					Six Months Ended
Instruments	July 2, 2016			July 4, 2015		July 2, 2016		July 4, 2015			Location
Foreign currency forward contracts	$	(2	)	$	1	$	1	$	(8	)	Other (income) expense

The net (gains) losses werealmost entirely offset by corresponding net (losses) gains on the foreign currency exposures being managed.

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Location and Fair Value Amount of Derivative Instruments

The following table summarizes the fair value of the Company’s derivative instruments and their locations in the Condensed Consolidated Balance Sheets as of July 2, 2016 and January 2, 2016 (in millions):

Fair Value of Derivative Instruments	July 2, 2016			January 2, 2016			Location
Derivatives Designated as Hedging Instruments
Foreign currency forward contracts	$	4		$	14		Other current assets
	1			2			Other assets
	(34		)	(6		)	Other current liabilities
	(5		)	(3		)	Other liabilities
Derivatives Not Designated as Hedging Instruments
Foreign currency forward contracts	—			—			Other current assets
	—			—			Other current liabilities
Total	$	(34	)	$	7

Additional information with respect to the fair values of the Company's derivative instruments is included in Note 8.

Credit Risk and Offsetting of Assets and Liabilities of Derivative Instruments

As of July 2, 2016, St. Jude Medical, Inc. had International Swaps and Derivatives Association agreements with four applicable banks and financial institutions that contain netting provisions.

The following tables provide information as though the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria in the event of default or termination as stipulated by the terms of the netting arrangements with each of the counterparties as of July 2, 2016 and January 2, 2016, respectively (in millions):

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			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
			Eligible Offsetting
	Gross Amount of		Recognized
	Derivative Assets		Derivative Liabilities
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of July 2, 2016	Balance Sheet		Balance Sheet		Received		Assets
Derivatives subject to master netting agreements	$	3	$	2	$	—	$	1
Derivatives not subject to master netting agreements	2						2
Total	$	5	$	2	$	—	$	3
			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
	Gross Amount of		Eligible Offsetting
	Derivative		Recognized
	Liabilities		Derivative Assets
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of July 2, 2016	Balance Sheet		Balance Sheet		Pledged		Liabilities
Derivatives subject to master netting agreements	$	22	$	2	$	—	$	20
Derivatives not subject to master netting agreements	17						17
Total	$	39	$	2	$	—	$	37

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			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
			Eligible Offsetting
	Gross Amount of		Recognized
	Derivative Assets		Derivative Liabilities
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of January 2, 2016	Balance Sheet		Balance Sheet		Received		Assets
Derivatives subject to master netting agreements	$	3	$	1	$	—	$	2
Derivatives not subject to master netting agreements	13						13
Total	$	16	$	1	$	—	$	15
			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
	Gross Amount of		Eligible Offsetting
	Derivative		Recognized
	Liabilities		Derivative Assets
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of January 2, 2016	Balance Sheet		Balance Sheet		Pledged		Liabilities
Derivatives subject to master netting agreements	$	1	$	1	$	—	$	—
Derivatives not subject to master netting agreements	8						8
Total	$	9	1		$	—	$	8

For each counterparty, if netted, the Company would offset the asset and liability balances of all derivatives at the end of the reporting period. Derivatives not subject to master netting agreements are not eligible for net presentation. As of both July 2, 2016 and January 2, 2016, no cash collateral had been received or pledged related to these derivative instruments.

NOTE 10 – BUSINESS COMBINATIONS

Fiscal Year 2016

Middle East distributor: In February 2016, the Company acquired certain assets and assumed certain liabilities of a medical device distributor in the Middle East for $19 million of total purchase consideration. The transaction was accounted for as a purchase business combination. The purchase price allocation, which includes customer relationship intangible assets of $7 million and goodwill of $5 million, is considered preliminary, largely with respect to certain tax-related assets and liabilities. During the second quarter of 2016, the Company did not recognize material adjustments to provisional amounts.

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Fiscal Year 2015

Thoratec: The Company continues to evaluate information about facts and circumstances that existed as of the date Thoratec was acquired. As such, the purchase price allocation is considered preliminary, largely with respect to certain tax-related assets and liabilities and legal contingencies. During the first six months of 2016, the Company did not recognize material adjustments to provisional amounts.

NOTE 11 - ABBOTT TRANSACTION

On April 27, 2016, the Company and Abbott entered into an agreement and plan of merger (the “Merger Agreement”). Under the Merger Agreement generally each outstanding share of the Company’s common stock will be converted into the right to receive (x) $46.75 in cash, without interest thereon, and (y) 0.8708 of a validly issued, fully paid and non-assessable common share of Abbott (such ratio as may be adjusted pursuant to the Merger Agreement), less any applicable withholding taxes.

Completion of the merger is subject to customary closing conditions, including (i) adoption of the Merger Agreement by the affirmative vote of the holders of a majority of all outstanding Company common shares, (ii) effectiveness of the Registration Statement on Form S-4 to be filed with the Securities and Exchange Commission by Abbott in connection with the registration of the Abbott common shares to be issued in the merger, (iii) the expiration of the waiting period applicable under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (HSR Act), and receipt of other specified antitrust approvals, (iv) subject to specified materiality thresholds, the accuracy of the representations and warranties of the other party, (v) the other party having performed in all material respects all of its obligations under the Merger Agreement, (vi) the absence of a material adverse effect, as defined in the Merger Agreement, on the other party, and (vii) the receipt by each party of opinions to the effect that the transaction will be treated as a reorganization for U.S. federal income tax purposes.

On July 11, 2016, the Company and Abbott each received a request for additional information (the Second Request) from the United States Federal Trade Commission (FTC) pursuant to the HSR Act, in connection with Abbott’s pending acquisition of the Company. The effect of the Second Request is to extend the waiting period imposed by the HSR Act until 30 days after Abbott and the Company have substantially complied with the request, unless that period is extended voluntarily by the parties or terminated sooner by the FTC.

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

Our business is focused on the development, manufacture and distribution of cardiovascular medical devices for the global cardiac rhythm management, cardiovascular and atrial fibrillation therapy areas, and interventional pain therapy and neurostimulation devices for the management of chronic pain and movement disorders. In the first quarter of 2016, we changed our sales reporting to closely align with how we manage the business in five key product categories:

1) Traditional Cardiac Rhythm Management (single and dual chamber tachycardia implantable cardioverter defibrillator (ICD) and bradycardia pacemaker (pacemaker) devices);

2) Heart Failure (HF) (cardiac resynchronization therapy (CRT) defibrillator (CRT-D) and pacemaker (CRT-P) devices, ventricular assist devices and heart failure monitoring devices);

3) Cardiovascular (vascular closure products, heart valve replacement and repair products, pressure measurement guidewires, optical coherence tomography (OCT) imaging products and fractional flow reserve (FFR) technology, structural heart defect devices, vascular plugs and percutaneous heart pumps);

4) Atrial Fibrillation (AF) (electrophysiology (EP) introducers and catheters, advanced cardiac mapping, navigation and recording systems, ablation systems and left atrial appendage occlusion); and

5) Neuromodulation (spinal cord stimulation and radiofrequency ablation to treat chronic pain and deep brain stimulation to treat movement disorders).

Prior period amounts have been reclassified to conform to the current period's presentation. References to “St. Jude Medical,” “St. Jude,” “the Company,” “we,” “us” and “our” are to St. Jude Medical, Inc. and its subsidiaries.

This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with the MD&A included in our Current Report on Form 8-K filed with the SEC on June 7, 2016 for the fiscal year ended January 2, 2016 for important background including industry-wide and general economic factors affecting our business and our key business drivers.

Recent Developments

Net sales for the second quarter and first six months of 2016 increased 11% and 9%, respectively, compared to the same prior year periods. Foreign currency translation negatively impacted our 2016 second quarter and first six months net sales by $6 million and $48 million, respectively, compared to the same periods in 2015. Our increase in net sales during the second quarter and first six months of 2016 compared to the same prior year periods was driven by the following key areas:

• We benefited from incremental net sales associated with our HF ventricular assist devices, acquired through our acquisition of Thoratec Corporation (Thoratec) during the fourth quarter of 2015.

• We experienced incremental net sales from our recent launch of the Proclaim™ Elite Spinal Cord Stimulation System (U.S. Food and Drug Administration (FDA) approval in November 2015).

• We continued to benefit from increased EP catheter ablation procedures, led by incremental net sales associated with our FlexAbility™ ablation catheter (FDA approval in January 2015) and our TactiCath® irrigated ablation catheter. Additionally, we benefited from increased net sales volumes related to our AF introducers, our intracardiac echocardiography imaging (ICE) product offerings, our AF diagnostic devices and our advanced cardiac mapping systems.

• We also benefited from increased transcatheter aortic valve replacement (TAVR) procedures and net sales volume increases related to our OCT imaging products and FFR technology, particularly in Europe.

In addition to the unfavorable foreign currency translation, we have also experienced partially offsetting net sales declines during the second quarter and first six months of 2016 compared to the same prior year period in our traditional pacemaker and ICD devices, our CRT-D devices, our CardioMEMS™ HF System and our mechanical heart valves. Refer to the Results of Operations section for a more detailed discussion on our net sales.

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Diluted net earnings per share attributable to St. Jude Medical, Inc. for the second quarter and first six months of 2016 were $0.83 and $1.16, respectively, driven by the revenue impacts described above and the following key items which resulted in net after-tax charges of $0.13 and $0.60 per diluted share during the second quarter and first six months of 2016, respectively:

• We recognized after-tax acquisition-related costs, including contingent consideration fair value adjustments, of $0.06 and $0.21 per diluted share during the second quarter and first six months of 2016, respectively.

• We recognized after-tax restructuring charges of $0.04 and $0.10 per diluted share during the second quarter and first six months of 2016, respectively.

• We recognized unfavorable income tax adjustments of $0.02 and $0.20 per diluted share during the second quarter and first six months, respectively.

• We recognized after-tax investment impairment charges of $0.11 per diluted share during the first six of 2016.

• We recognized after-tax net benefits related to litigation matters of $0.04 per diluted share during the first six months of 2016.

• We recognized after-tax product field action costs and litigation costs of $0.01 and $0.02 per diluted share during the second quarter and first six months of 2016, respectively.

Refer to the Results of Operations section for a more detailed discussion of these charges.

Significant cash flow activity during the first six months of 2016 included the following key items:

• We generated $463 million of cash flows from operating activities.

• We repaid $500 million principal amount of our 5-year, 2.500% unsecured senior notes (2016 Senior Notes), made net commercial paper payments of $117 million and drew the remaining $500 million of our 5-year, $2.6 billion term loan due 2020 (Term Loan Due 2020). We also made payments of $226 million on our Term Loan Due 2020.

• We returned $170 million to shareholders in the form of dividends during the first six months of 2016.

• We paid $125 million to settle the contingent consideration liability associated with the Spinal Modulation regulatory-based milestone.

On April 27, 2016, St. Jude Medical and Abbott Laboratories (Abbott) entered into an agreement and plan of merger (the Merger Agreement) (see Note 11 to the CondensedConsolidated Financial Statements).

RESULTS OF OPERATIONS

Net sales

While we manage our operations globally and believe our product category sales are the most relevant measure of revenue performance, we also utilize geographic area revenue data as a secondary performance measure.

The following table presents net sales to external customers for our five key product categories (in millions):

	Three Months Ended						Six Months Ended
	July 2, 2016		July 4, 2015		% Change		July 2, 2016		July 4, 2015		% Change
Traditional Cardiac Rhythm Management	$	395	$	430	(8.2	)%	$	761	$	838	(9.2	)%
Heart Failure	384		260		47.5	%	758		511		48.1	%
Cardiovascular	319		316		1.1	%	620		618		0.4	%
Atrial Fibrillation	324		286		13.2	%	615		562		9.3	%
Neuromodulation	140		118		18.8	%	256		226		13.5	%
Net sales	$	1,562	$	1,410	10.8	%	$	3,010	$	2,755	9.2	%

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The following table presents net sales by significant geographic area based on customer location (in millions):

	Three Months Ended						Six Months Ended
	July 2, 2016		July 4, 2015		% Change		July 2, 2016		July 4, 2015		% Change
United States	$	795	$	712	11.5	%	$	1,571	$	1,393	12.7	%
Europe	401		352		14.0	%	757		695		9.0	%
Japan	131		116		13.0	%	250		233		7.5	%
Other foreign countries	235		230		2.3	%	432		434		(0.5	)%
Net sales	$	1,562	$	1,410	10.8	%	$	3,010	$	2,755	9.2	%

Our net sales are impacted by multiple factors, the most significant of which are often impacts of acquisitions and foreign currency translation. Operational sales changes include organic volume and selling price impacts. These impacts for the second quarter and first six months of 2016 compared to the same prior year periods were as follows:

	Three Months Ended July 2, 2016 % Change		Six Months Ended July 2, 2016 % Change
Operational	0.7	%	0.3	%
Acquisitions	10.5	%	10.6	%
Translation	(0.4	)%	(1.7	)%
Net sales change	10.8	%	9.2	%

During the second quarter and first six months of 2016, incremental net sales of our ventricular assist devices, acquired through our acquisition of Thoratec in October 2015, favorably impacted all geographies. Additionally, the U.S. continued to benefit from incremental net sales associated with our recent launch of the Proclaim™ Elite Spinal Cord Stimulation System (FDA approval in November 2015), increased EP catheter ablation procedures and other net sales volume increases associated with our AF introducers, ICE product offerings and AF diagnostic devices. During the second quarter and first six months of 2016, Europe's net sales also benefited from increased TAVR procedures and net sales volume increases associated with our OCT imaging products and FFR technology, AF introducers and our recent launch of the Proclaim™ Elite Spinal Cord Stimulation System. Partially offsetting these net sales benefits, we experienced unfavorable foreign currency translation impacts primarily due to the U.S. Dollar strengthening against certain currencies in South America during the second quarter and first six months of 2016 and as a result of the U.S. Dollar strengthening against the Euro during the first six months of 2016 compared to the same periods in 2015. Additionally, we have continued to experience a net sales decline, predominately in the U.S, in our traditional ICD and pacemaker devices as well as our CRT-D devices driven by competitive pressures from third party magnetic resonance imaging (MRI) compatible devices during the second quarter and first six months of 2016 compared to the same prior year periods. Our CardioMEMS™ HF System also experienced net sales declines, primarily in the U.S., during the second quarter and first six months of 2016 compared to the same periods in 2015 due to the reimbursement challenges faced by our customers. We continue to work through the national coverage determination process to expand access for patients currently not covered, and we are observing data from hospitals publishing their experiences with the CardioMEMS™ HF System to demonstrate improved patient outcomes and reduction in healthcare costs.

The foreign currency translation impacts to net sales are not necessarily indicative of the net earnings impact of foreign currency translation due to partially offsetting foreign currency translation impacts on cost of sales, operating expenses and our hedging program.

The net sales fluctuations for the second quarter and first six months of 2016 compared to the same prior year period are further discussed by our five key product categories.

Traditional Cardiac Rhythm Management: We continued to experience net sales declines in our ICD and pacemaker devices during the second quarter and first six months of 2016 compared to the same prior year periods, primarily driven by competitive pressures from third party MRI compatible devices, predominately in the U.S, including overall average selling price declines due to a market preference for such devices. Foreign currency translation also unfavorably impacted our Traditional Cardiac Rhythm Management net sales by $4 million (1

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percentage point) and $18 million (2 percentage points) during the second quarter and first six months of 2016, respectively, compared to the same periods in 2015.

Heart Failure: The increase in HF net sales during the second quarter and first six months of 2016 compared to the same prior year periods is primarily due to incremental net sales associated with our ventricular assist devices, acquired through our Thoratec acquisition. Partially offsetting the net sales increases, we continued to experience net sales declines in our CRT-D devices primarily driven by competitive pressures from third party MRI compatible devices, predominately in the U.S, including overall average selling price declines due to a market preference for such devices. We also experienced net sales declines in our CardioMEMS™ HF System during the second quarter and first six months of 2016 compared to the same prior year periods due to the reimbursement challenges faced by our customers. Foreign currency translation impacting net sales was relatively flat during the second quarter of 2016 compared to the second quarter of 2015 and unfavorably impacted the first six months 2016 Heart Failure net sales by $6 million (2 percentage points) compared to the same prior year period.

Cardiovascular: During the second quarter and first six months of 2016, we experienced net sales volume increases associated with our TAVR products and OCT imaging products and FFR technology. Foreign currency translation impacting net sales was relatively flat during the second quarter of 2016 compared to the same prior year period and unfavorably impacted our first six months 2016 Cardiovascular net sales by $12 million (2 percentage points) compared to the same period in 2015. Additionally, we continued to experience a net sales decline in our mechanical heart valves due to a market preference for TAVR products during the second quarter and first six months of 2016 compared to the same prior year periods.

Atrial Fibrillation: AF continued to benefit from increased EP catheter ablation procedures and increased net sales volumes related to our ICE product offerings, advanced cardiac mapping systems and our AF introducers and diagnostic devices during the second quarter and first six months of 2016 compared to the same prior year periods. Our EP catheter ablation net sales continued to benefit from incremental net sales associated with our FlexAbility™ ablation catheter (FDA approval in January 2015) and our TactiCath® irrigated ablation catheter during the second quarter and first six months of 2016 compared to the same prior year periods. We also experienced increased net sales volumes associated with our ICE product offerings and our Ensite NavX™ navigation and visualization technology during the second quarter and first six months of 2016 compared to the same periods in 2015. Additionally, net sales volume increases were also driven by our Agilis™ NxT steerable introducer, Swartz™ guiding introducer and our diagnostic catheters during the second quarter and first six months of 2016 compared to the same prior year periods. Foreign current translation impacting net sales was relatively flat during the second quarter of 2016 compared to the second quarter of 2015 and unfavorably impacted the first six months 2016 AF net sales by $8 million (1 percentage point) compared to the same prior year period.

Neuromodulation: The primary increase in Neuromodulation net sales during the second quarter and first six months of 2016 was the result of incremental net sales associated with our recent launch of the Proclaim™ Elite Spinal Cord Stimulation System (FDA approval in November 2015) compared to the same prior year periods. Foreign currency translation impacting net sales was relatively flat during the second quarter of 2016 compared to the second quarter of 2015 and unfavorably impacted the first six months 2016 Neuromodulation net sales by $4 million (2 percentage points) compared to the same prior year period.

Gross profit
	Three Months Ended									Six Months Ended
(in millions)	July 2, 2016			July 4, 2015			Change			July 2, 2016			July 4, 2015			Change
Gross profit	$	1,066		$	986		8.1	%		$	2,027		$	1,936		4.7	%
Percentage of net sales	68.2		%	69.9		%	(1.7	)	pts.	67.3		%	70.3		%	(3.0	)	pts.

Our gross profit percentage (or gross margin) was unfavorably impacted by foreign currency translation during the second quarter and first six months of 2016 by approximately 0.8 percentage points and 1.1 percentage points, respectively, compared to the same periods in 2015. In 2015, we began to enter into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies. Our hedging program has moderately mitigated periodic fluctuations. Additionally, inventory acquired in our Thoratec acquisition was recorded at fair value, which closely approximates normal selling prices. This resulted in higher cost of sales for Thoratec products sold in the second quarter and first six months of 2016, which negatively impacted our second quarter and first six months 2016 gross margins by approximately 0.6 percentage points and

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1.4 percentage points, respectively. We also experienced additional negative gross margin impact during the second quarter and first six months of 2016 compared to the same prior year periods as a result of unfavorable average selling price impacts and geographic sales mix, primarily driven by competitive pressures from third party MRI compatible pacemaker, CRT-D and ICD devices.

Special charges negatively impacted our gross margins during the second quarter and first six months of 2016 by approximately 0.3 percentage points. Special charges negatively impacted our gross margins during the second quarter and first six months of 2015 by approximately 0.4 percentage points and 0.2 percentage points, respectively.

Our gross margins for the second quarter and first six months of 2016 were also negatively impacted by 0.7 percentage points and 0.9 percentage points, respectively, of excise taxes assessed on the sale of our products. During the second quarter and first six months of 2015, our gross margins were negatively impacted by 1.4 percentage points of excise taxes assessed on the sale of our products. We expect the unfavorable impact of excise taxes on our gross margins to be lower in 2016 and 2017 compared to 2015 due to the H.R. 2029 law passed in December 2015 which temporarily suspends the U.S. medical device excise tax. The temporary suspension has no impact on the Puerto Rico excise tax.

Selling, general and administrative (SG&A) expense
	Three Months Ended									Six Months Ended
(in millions)	July 2, 2016			July 4, 2015			Change			July 2, 2016			July 4, 2015			Change
Selling, general and administrative expense	$	502		$	447		12.3	%		$	993		$	877		13.2	%
Percentage of net sales	32.1		%	31.7		%	0.4		pts.	33.0		%	31.8		%	1.2		pts.

The increase in our SG&A expense during the second quarter and first six months of 2016 was primarily driven by net acquisition-related costs, including stock-based compensation expense for Thoratec-related replacement equity awards, transaction and integration costs, and contingent consideration fair value adjustments, of $15 million (0.9 percentage points) and $48 million (1.6 percentage points), respectively. Our second quarter and first six months of 2015 SG&A expense was favorably impacted by net acquisition-related benefits of $10 million (0.7 percentage points) and $32 million (1.1 percentage points), respectively, primarily due to a decrease in the fair value of the Nanostim, Inc. contingent consideration liability to reflect a change in the expected timing and probability of future revenue milestone achievements. The partially offsetting benefit during the second quarter and first six months of 2016 was primarily the result of our cost savings initiatives, including benefits associated with our restructuring activities.

Research and development (R&D) expense
	Three Months Ended									Six Months Ended
(in millions)	July 2, 2016			July 4, 2015			Change			July 2, 2016			July 4, 2015			Change
Research and development expense	$	192		$	171		12.3	%		$	380		$	338		12.4	%
Percentage of net sales	12.3		%	12.1		%	0.2		pts.	12.6		%	12.3		%	0.3		pts.

Our R&D expense as a percent of net sales has remained relatively consistent, reflecting our commitment to fund growth through cost effective innovation. Our investment in R&D reflects our commitment to fund long-term growth opportunities while balancing short-term results. Our global R&D activities primarily include research, development, clinical and regulatory efforts. These efforts are primarily focused on product innovation that we anticipate will ultimately improve patient outcomes, reduce overall healthcare costs and provide economic value to our customers while providing the best possible technology available. We will continue to assess our R&D programs in future periods as we focus on the development of new products and the improvement to existing products. Our most significant clinical trials as of July 2, 2016 are summarized as follows:

• Portico Re-sheathable Transcatheter Aortic Valve System U.S. Investigational Device Exemption (IDE) Trial: The objective of this clinical trial is to evaluate the safety and effectiveness of the Portico Transcatheter Heart Valve and Delivery Systems (Portico) via transfemoral and alternative delivery

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methods. The clinical study will analyze the high risk cohort and extreme risk cohort together against a commercially available control for the primary safety and effectiveness endpoints.

• Thoratec Corporation MOMENTUM 3, Multi-center Study of MagLev Technology in Patients Undergoing mechanical circulatory support (MCS) Therapy with HeartMate 3™ (HM3) IDE Clinical Study Protocol: The objective of this clinical study is to evaluate the safety and effectiveness of the HM3 Left Ventricular Assist System (LVAS) by demonstrating non-inferiority to the HeartMate 2™ LVAS when used for the treatment of advanced, refractory, left ventricular HF. The HM3 LVAS is intended to provide hemodynamic support in patients with advanced, refractory left ventricular HF, either for short term support, such as a bridge to cardiac transplantation or myocardial recovery, or as long term support, such as destination therapy. The HM3 is intended for use inside or outside the hospital.

• Thoratec Corporation HeartMate PHP™ Coronary InterventionS in HIgh-Risk PatiEnts Using a Novel Percutaneous Left Ventricular Support Device (SHIELD II) study protocol: The HeartMate PHP™ System is a temporary (less than 6 hour procedure) ventricular assist device indicated for use during high risk percutaneous coronary interventions (PCI) performed in elective or urgent, hemodynamically stable patients with severe coronary artery disease and depressed left ventricular ejection fraction. The trial objective is to assess the safety and efficacy of the HeartMate PHP™ in supporting patients with severe symptomatic coronary artery disease with diminished but stable cardiovascular function, who are undergoing elective or urgent high risk PCI but are not candidates for coronary artery bypass graft surgery. The trial is designed as a prospective, randomized, multi-center, open-label non-inferiority trial in the U.S. comparing HeartMate PHP™ to Abiomed® Impella® 2.5 percutaneous cardiac support system.

Amortization of intangible assets
	Three Months Ended						Six Months Ended
(in millions)	July 2, 2016		July 4, 2015		Change		July 2, 2016		July 4, 2015		Change
Amortization of intangible assets	$	46	$	24	91.7	%	$	92	$	48	91.7	%

The primary increase in our intangible asset amortization expense during the second quarter and first six months of 2016 compared to the same prior year periods was driven by our acquisition of Thoratec in October 2015. Additionally, we received FDA approval of the Axium™ Neurostimulator System in February 2016 and reclassified the related acquired in-process research and development from an indefinite-lived intangible asset to a purchased technology definite-lived intangible asset and began amortization.

Special charges

We recognize certain transactions and events as special charges in our Condensed Consolidated Financial Statements. These charges (such as restructuring charges, impairment charges, certain legal settlements or product field action costs and litigation costs) result from facts and circumstances that vary in frequency and impact on our results of operations. Generally, special charges are reflected in the CondensedConsolidated Statements of Earnings within our operating expenses in a separate line item, special charges. However, based on the nature of the charge, when certain special charges impact the calculation of gross profit, they are reflected in the line item cost of sales special charges within the Condensed Consolidated Statements of Earnings. The most common special charges impacting the cost of sales special charge line item relate to manufacturing activities. Refer to Note 4 to the CondensedConsolidated Financial Statements for a detailed discussion of our special charges.

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The following table provides additional detail about our special charges and related income statement classification within our Condensed Consolidated Statements of Earnings (in millions):

	Three Months Ended								Three Months Ended
	July 2, 2016								July 4, 2015
Type of Special Charge	Cost of Sales Special Charges		Special Charges			Total Special Charges			Cost of Sales Special Charges			Special Charges		Total Special Charges
Restructuring activities
2016 Initiatives	$	2	$	10		$	12		$	—		$	—	$	—
Manufacturing and Supply Chain Optimization Plan	1		1			2			6			21		27
2012 Business Realignment Plan	—		—			—			3			6		9
Other restructuring-related charges	—		1			1			—			—		—
Legal settlements	—		(2		)	(2		)	—			—		—
Product field action costs and litigation costs	3		3			6			(4		)	3		(1		)
Total special charges	$	6	$	13		$	19		$	5		$	30	$	35

	Six Months Ended									Six Months Ended
	July 2, 2016									July 4, 2015
Type of Special Charge	Cost of Sales Special Charges			Special Charges			Total Special Charges			Cost of Sales Special Charges			Special Charges			Total Special Charges
Restructuring activities
2016 Initiatives	$	6		$	30		$	36		$	—		$	—		$	—
Manufacturing and Supply Chain Optimization Plan	2			1			3			8			27			35
2012 Business Realignment Plan	(2		)	—			(2		)	5			9			14
Other restructuring-related charges	—			3			3			—			—			—
Legal settlements	—			(19		)	(19		)	—			(10		)	(10		)
Product field action costs and litigation costs	3			6			9			(6		)	8			2
Total special charges	$	9		$	21		$	30		$	7		$	34		$	41

The 2012 Business Realignment Plan was precipitated by our strategic decision to begin merging four product divisions (legacy Cardiac Rhythm Management, Neuromodulation, Cardiovascular and Atrial Fibrillation divisions) into one integrated operating segment. Upon changing our internal reporting structures in the third quarter of 2014 to align with the new global organization, we initiated the Manufacturing and Supply Chain Optimization Plan. The objectives of this plan were driven by opportunities we identified as a result of the enhanced visibility we had into our newly consolidated manufacturing and supply chain operations. As a net result of these related plans, we have closed certain of our facilities and consolidated their activities into other facilities, we have made changes to our product distribution methods in certain geographies and we now manage our operations with a single, global focus that is tailored, where necessary, for local requirements.

As we refined our long-term forecasts, including the integration of Thoratec into our business, we began to make decisions regarding the programs and initiatives we will prioritize to strengthen our strategic focus (the 2016 Initiatives). These decisions are being made in alignment with how we manage the business in five key areas. We plan to use some of the cost savings from these actions to reinvest in our growth drivers.

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Other expense, net
	Three Months Ended				Six Months Ended
(in millions)	July 2, 2016		July 4, 2015		July 2, 2016			July 4, 2015
Interest income	$	—	$	—	$	(1	)	$	(1	)
Interest expense	40		20		80			41
Other (income) expense	3		—		56			(3		)
Other expense, net	$	43	$	20	$	135		$	37

Interest income: Our interest income is dependent on our outstanding cash balances and applicable interest rates.

Interest expense: Our interest expense increased during the second quarter and first six months of 2016 compared to the same prior year periods as a result of higher average debt balances primarily issued to finance our Thoratec acquisition. See Note 2 of our Condensed Consolidated Financial Statements for further information on our debt.

Other (income) expense: Generally, our other (income) expense includes foreign currency transaction gains and losses, realized available-for-sale security gains and losses and gains and losses on derivative instruments not designated as hedging instruments. During the first six months of 2016, we concluded that adverse regulatory rulings and subsequent operational decisions made by an entity in which we had strategic debt and equity investments had an adverse impact on the fair values of those investments. As a result, we recognized other-than-temporary impairments of approximately $50 million to fully write-down our cost method equity investment and convertible debt investment. During the second quarter and first six months of 2016 we also recognized a $2 million gain and a $1 million loss, respectively, associated with our derivative instruments not designated as hedging instruments. During the second quarter and first six months of 2015 we recognized a $1 million loss and an $8 million gain, respectively, related to our derivative instruments not designated as hedging instruments. Additionally, we recognized $3 million and $7 million of realized gains associated with the sale of our available-for-sale securities during the second quarter and first six months of 2015, respectively. See Notes 6 and 9 of the Condensed Consolidated Financial Statements for further information on our gains and losses impacting other (income) expense.

Income taxes

	Three Months Ended				Six Months Ended
(as a percent of earnings before income taxes and noncontrolling interest)	July 2, 2016		July 4, 2015		July 2, 2016		July 4, 2015
Effective tax rate	11.9	%	4.1	%	18.0	%	10.6	%

The changes in the effective income tax rates from the second quarter and first six months of 2016 compared to the same prior year periods were primarily a result of the tax impact of special charges, acquisition-related costs, other-than-temporary impairments, discrete income tax items and changes in the mix of income before income taxes between U.S. and foreign countries. Refer to Note 7 of the Condensed Consolidated Financial Statements for additional information.

Net loss attributable to noncontrolling interest

	Three Months Ended					Six Months Ended
(in millions)	July 2, 2016		July 4, 2015			July 2, 2016		July 4, 2015
Net loss attributable to noncontrolling interest	$	—	$	(8	)	$	—	$	(14	)

Net loss attributable to noncontrolling interest represents the elimination of the losses attributable to non-St. Jude Medical, Inc. ownership interests in St. Jude Medical, Inc. consolidated entities. The changes in the net loss attributable to noncontrolling interest are largely related to the differing periods during which there were non-St. Jude Medical, Inc. ownership interests in Spinal Modulation.

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LIQUIDITY AND CAPITAL RESOURCES

We believe that our existing cash balances, future cash generated from operations and available borrowing capacity under our 5-year, $1.5 billion revolving, unsecured committed credit facility (Credit Facility Expiring 2020) and our commercial paper program will be sufficient to fund our operating needs, working capital requirements, R&D opportunities, capital expenditures, debt service requirements, share repurchases and shareholder dividends over the next 12 months and in the foreseeable future thereafter.

We believe that our earnings, cash flows and balance sheet position will permit us to obtain additional debt financing or equity capital should suitable investment and growth opportunities arise. We monitor capital markets regularly and may raise additional capital when market conditions or interest rate environments are favorable.

As of July 2, 2016, substantially all of our cash and cash equivalents were held by our non-U.S. subsidiaries. A portion of these foreign cash balances are associated with earnings that are permanently reinvested and which we plan to use to support our continued growth plans outside the United States through funding of operations and other investment and growth opportunities. The majority of these funds are only available for use by our U.S. operations if they are repatriated into the United States. The funds repatriated would be subject to additional U.S. taxes upon repatriation; however, it is not practicable to estimate the amount of additional U.S. tax liabilities we would incur. We currently have no plans to repatriate these funds held by our non-U.S. subsidiaries.

Certain of our debt outstanding and available borrowings contain operating and financial covenants. Specifically, the Credit Facility Expiring 2020 and the Term Loan Due 2020 require that we have a leverage ratio (defined as the ratio of indebtedness to EBITDA (net earnings before interest expense, income taxes, depreciation, amortization and certain income and expenses)) not exceeding 4.0 to 1.0 for the fiscal quarters of 2016 and 3.5 to 1.0 thereafter. Additionally, our 1.580% Yen Denominated Senior Notes Due 2017 and our 2.040% Yen Denominated Senior Notes Due 2020 (Yen Notes) required a ratio of total debt to total capitalization not exceeding 65% through the second fiscal quarter of 2016, reducing to 60% thereafter. Under the Credit Facility Expiring 2020, Term Loan Due 2020, senior notes and Yen Notes, we also have certain limitations on how we conduct our business, including limitations on dividends, additional liens or indebtedness and limitations on certain acquisitions, mergers, investments and dispositions of assets. We were in compliance with all of our debt covenants as of July 2, 2016. For further information on our debt obligations outstanding at July 2, 2016, refer to Note 2 to the CondensedConsolidated Financial Statements.

Pursuant to the Merger Agreement with Abbott, we are limited in our ability to incur any new indebtedness for borrowed money or issue or sell any new debt securities in the capital markets during the period from the signing of the Merger Agreement through the close of the merger.

As of July 2, 2016, our credit ratings were as follows:

• Moody’s Investors Service rated our senior unsecured debt and other long-term debt at Baa2 with negative watch and rated our short-term debt at Prime-2 with negative watch;

• Standard and Poor’s Ratings Services rated our long-term foreign and local issuer debt at A- with negative watch and rated our short-term foreign and local issuer debt at A2 with negative watch;

• Fitch Ratings rated our senior unsecured debt and other long-term debt at A- with negative watch and our short-term debt at F2 with negative watch.

We do not expect our credit ratings to have a significant impact on our liquidity or future flexibility to access additional funding.

Agency ratings are subject to change, and there can be no assurance that a ratings agency will continue to provide ratings and/or maintain its current ratings. A security rating is not a recommendation to buy, sell or hold securities, and may be subject to revision or withdrawal at any time by the rating agency, and each rating should be evaluated independently of any other rating. Agency ratings are based on a number of factors, which include financial strength, business and financial risk, as well as transparency with rating agencies and timeliness of financial reporting.

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A summary of our cash flows from operating, investing and financing activities is provided in the following table (in millions):

	Six Months Ended
	July 2, 2016			July 4, 2015
Net cash provided by (used in):
Operating activities	$	463		$	441
Investing activities	(129		)	(76		)
Financing activities	(613		)	(858		)
Effect of currency exchange rate changes on cash and cash equivalents	10			(39		)
Net increase (decrease) in cash and cash equivalents	$	(269	)	$	(532	)

Operating Cash Flows

Operating cash flows can fluctuate significantly from period to period due to payment timing differences of working capital accounts such as accounts receivable, inventories, accounts payable, accrued liabilities and income taxes payable. During the first six months of 2016, our operating cash flows were negatively impacted due to higher tax payments made primarily associated with certain tax audits.

We use two primary measures that focus on accounts receivable and inventory – days sales outstanding (DSO) and days inventory on hand (DIOH). We use DSO as a measure that places emphasis on how quickly we collect our accounts receivable balances from customers. We use DIOH, which can also be expressed as a measure of the estimated number of days of cost of sales on hand, as a measure that places emphasis on how efficiently we are managing our inventory levels. These measures may not be computed the same as similarly titled measures used by other companies. As of July 2, 2016 and January 2, 2016, our DSO and DIOH were as follows:

Measure	Defined Calculation	July 2, 2016	January 2, 2016
DSO	Ending net accounts receivable divided by average daily sales for the most recently completed quarter	77	78
DIOH	Ending net inventory divided by average daily cost of sales for the most recently completed six months	167	179

Our DSO at July 2, 2016 remained consistent with our DSO at January 2, 2016. Our July 2, 2016 DIOH decreased by five days as a result of inventory acquired through our acquisition of Thoratec and the related cost of sales during the six months ended July 2, 2016. Additionally, special charges recognized in cost of sales during the six months ended July 2, 2016 reduced our DIOH by approximately two days. Our January 2, 2016 DIOH increased by 10 days as a result of inventory acquired through our acquisition of Thoratec with only 13 weeks of Thoratec cost of sales activity based on our October 8, 2015 acquisition date. Partially offsetting the 10 day increase to our January 2, 2016 DIOH, special charges recognized in cost of sales in the last half of 2015 reduced our DIOH by six days.

Investing Cash Flows

Our purchases of property, plant and equipment totaled $114 million and $80 million during the first six months of 2016 and 2015, respectively, primarily reflecting our continued investment in our product growth platforms currently in place. We also acquired certain assets and assumed certain liabilities of a medical device distributor in the Middle East during the first six months of 2016.

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Financing Cash Flows

Our financing cash flows can fluctuate significantly depending upon our liquidity needs, the extent of our common stock repurchases and the amount of stock option exercises. A summary of our financing cash flows is provided in the following table (in millions):

	Six Months Ended
	July 2, 2016			July 4, 2015
Stock issued under employee stock plans, including tax benefit	$	25		$	103
Common stock repurchases	—			(500		)
Dividends paid	(170		)	(158		)
Debt borrowings (payments), net	(343		)	(115		)
Purchase of shares from noncontrolling interest	—			(173		)
Payment of contingent consideration	(125		)	—
Other, net	—			(15		)
Net cash provided by (used in) financing activities	$	(613	)	$	(858	)

During the first six months of 2016, we repaid $500 million principal amount of our 2016 Senior Notes, made net commercial paper payments of $117 million and drew the remaining $500 million of our Term Loan Due 2020 to refinance existing indebtedness and for general corporate purposes. We also made quarterly principal payments totaling $59 million and prepaid an additional $167 million on our Term Loan Due 2020. Additionally, we paid $125 million to settle the contingent consideration liability associated with the Spinal Modulation regulatory-based milestone.

During the first six months of 2015, we repaid our 2-year, $500 million unsecured term loan due June 2015 and our 364-day, $250 million unsecured term loan due August 2015, acquired the remaining ownership interest in Spinal Modulation and repurchased approximately 7.5 million shares of our common stock.

Generally, our common stock repurchases are funded from cash generated from operations and issuances of commercial paper. Changes in our common stock repurchases can vary from year to year based on our Board of Directors' authorization limits and other financing objectives.

We have increased our dividends every year since 2011. On August 3, 2016 our Board of Directors authorized a cash dividend of $0.31 per share payable on October 28, 2016 to shareholders of record as of September 30, 2016. We expect to continue to pay quarterly cash dividends in the foreseeable future, subject to Board approval and the Merger Agreement with Abbott.

NEW ACCOUNTING PRONOUNCEMENTS

Information regarding new accounting pronouncements is included in Note 1 to the Condensed Consolidated Financial Statements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

There have been no material changes to our critical accounting policies and estimates from the information provided in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Current Report on Form 8-K filed with the SEC on June 7, 2016 for the fiscal year ended January 2, 2016.

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CAUTIONARY STATEMENTS

In this Quarterly Report on Form 10-Q and in other written or oral statements made from time to time, we have included and may include statements that constitute “forward-looking statements” with respect to the financial condition, results of operations, plans, objectives, new products, future performance and business of St. Jude Medical, Inc. and its subsidiaries. Statements preceded by, followed by or that include words such as “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “forecast,” “project,” “believe” or similar expressions are intended to identify some of the forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are included, along with this statement, for purposes of complying with the safe harbor provisions of that Act. These forward-looking statements involve risks and uncertainties. By identifying these statements for you in this manner, we are alerting you to the possibility that actual results may differ, possibly materially, from the results indicated by these forward-looking statements. We undertake no obligation to update any forward-looking statements. Actual results may differ materially from those contemplated by the forward-looking statements due to, among other factors, the risks and uncertainties discussed in the sections entitled Off-Balance Sheet Arrangements and Contractual Obligations in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Current Report on Form 8-K filed with the SEC on June 7, 2016 for the fiscal year ended January 2, 2016, in the section entitled Market Risk in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk of our Annual Report on Form 10-K for the fiscal year ended January 2, 2016 (2015 Form 10-K) and in the section entitled Risk Factors in Part I, Item 1A in our 2015 Form 10-K and in the section entitled Risk Factors in Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarter ended April 2, 2016 as well as the various factors described below. Since it is not possible to foresee all such factors, you should not consider these factors to be a complete list of all risks or uncertainties. We believe the most significant factors that could affect our future operations and results are set forth in the following list.

1.	Competition, including product introductions by competitors that have advanced technology, better features or lower pricing.
2.	Consolidation and other healthcare industry changes leading to demands for price concessions and/or limitations on, or the elimination of, our ability to sell in significant market segments.
3.	Changes in laws, regulations or administrative practices affecting government regulation of our products, such as FDA regulations, including those that decrease the probability or increase the time and/or expense of obtaining approval for products or impose additional burdens on the manufacture and sale of medical devices.
4.	Governmental legislation, including the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act, and/or regulation that significantly impacts the healthcare system in the United States or in international markets and that results in lower reimbursement for procedures using our products or denies coverage for such procedures, reduces medical procedure volumes or otherwise adversely affects our business and results of operations, including the imposition of any medical device excise tax.
5.	Any changes to the U.S. Medicare or Medicaid systems or international reimbursement systems that significantly reduces reimbursement for procedures using our medical devices or denies coverage for such procedures, as well as adverse decisions relating to our products by administrators of such systems on coverage or reimbursement issues.
6.	Adverse developments in investigations and governmental proceedings.
7.	Changes in accounting rules or tax laws that adversely affect our results of operations, financial position or cash flows.
8.	Risks associated with our substantial international operations, including economic and political instability, currency fluctuations, changes in customs, tariffs and other trade restrictions and compliance with foreign laws.
9.	Disruptions in the financial markets or changes in economic conditions, including interest rates, inflation rates and exchange rates, that adversely impact the availability and cost of credit and customer purchasing and payment patterns, including the collectability of customer accounts receivable.
10.	Our inability to realize the expected benefits from our restructuring initiatives and continuous improvement efforts and the negative unintended consequences such activity could have.
11.	Our inability to maintain, protect and enhance our information and manufacturing systems and our products that incorporate information technology or to develop new systems and products as well as risks to the privacy and security of customer, patient, third-party payor, employee, supplier or company information from continually evolving cybersecurity threats.
12.	Inability to successfully integrate the businesses that we have acquired in recent years, including our recent acquisition of Thoratec, and that we plan to acquire.

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13.	The substantial additional indebtedness we incurred to finance the Thoratec acquisition, which may decrease our business flexibility and increase our borrowing costs.
14.	A reduction in the number of procedures using our devices caused by cost-containment pressures, publication of adverse study results, initiation of investigations of our customers related to our devices or the development of or preferences for alternative technologies or therapies.
15.	Safety, performance or efficacy concerns about our products, many of which are expected to be implanted for many years, some of which may lead to recalls and/or advisories with the attendant expenses and declining sales.
16.	Failure to successfully complete, or unfavorable data from, clinical trials for our products or new indications for our products and/or failure to successfully develop markets for such new indications.
17.	Assertion, acquisition or grant of key patents by or to others that have the effect of excluding us from market segments or requiring us to pay royalties.
18.	Declining industry-wide sales caused by product quality issues or recalls or advisories by us or our competitors that result in loss of physician and/or patient confidence in the safety, performance or efficacy of sophisticated medical devices in general and/or the types of medical devices recalled in particular.
19.	Adverse developments in litigation, including product liability litigation, patent or other intellectual property litigation, qui tam litigation or shareholder litigation.
20.	The loss of, or price increases by, suppliers of key components, some of which are sole-sourced.
21.	Regulatory actions arising from concern over Bovine Spongiform Encephalopathy, sometimes referred to as “mad cow disease,” that have the effect of limiting our ability to market products using bovine collagen, such as Angio-Seal™, or products using bovine pericardial material, such as our Biocor®, Epic™, Trifecta™ and Portico™ tissue heart valves or that impose added costs on the procurement of bovine collagen or bovine pericardial material.
22.	Conditions imposed in resolving, or any inability to timely resolve, any regulatory issues raised by the FDA, including Form 483 observations or warning letters, as well as risks generally associated with our health, safety and environmental regulatory compliance and quality systems.
23.	Our ability to fund future product liability losses related to claims made subsequent to becoming self-insured.
24.	Severe weather or other natural disasters that can adversely impact customer purchasing patterns and/or patient implant procedures or cause damage to the facilities of our critical suppliers or one or more of our facilities, such as an earthquake affecting our facilities in California, Puerto Rico and Costa Rica or a hurricane affecting our facilities in Puerto Rico and Malaysia.
25.	The effect of our pending acquisition by Abbott on us and the fact that the Merger Agreement is subject to closing conditions, many of which are outside our control.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For further information on market risk, refer to Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk in our 2015 Form 10-K. There have been no material changes in information that would have been provided in the context of Item 3 from the end of the preceding year through July 2, 2016.

Item 4. CONTROLS AND PROCEDURES

As of July 2, 2016, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the Exchange Act)). Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of July 2, 2016.

There were no changes in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during the second quarter of 2016 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II -OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

Our significant legal proceedings are discussed in Note 3 to the Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q, are incorporated herein by reference and should be considered an integral part of Part II Item 1, "Legal Proceedings."

Item 1A.     RISK FACTORS

There has been no material change in the risk factors set forth in Part I, Item 1A, Risk Factors in our 2015 Form 10-K and in Part II, Item 1A , Risk Factors of our Quarterly Report on Form 10-Q for the quarter ended April 2, 2016.

Item 2.         UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

No matters require disclosure.

Item 3.         DEFAULTS UPON SENIOR SECURITIES

No matters require disclosure.

Item 4.         MINE SAFETY DISCLOSURES

No matters require disclosure.

Item 5.         OTHER INFORMATION

No matters require disclosure.

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Item 6. EXHIBITS

Exhibit
No.	Description
2.1	Agreement and Plan of Merger, dated as of April 27, 2016, by and among St. Jude Medical, Inc., Abbott Laboratories, Vault Merger Sub, Inc. and Vault Merger Sub, LLC is incorporated by reference to Exhibit 2.1 to St. Jude Medical’s Current Report on Form 8-K filed on April 28, 2016.
3.1	Amendments to the Bylaws of St. Jude Medical, Inc., effective as of April 27, 2016, are incorporated by reference to Exhibit 3.2 to St. Jude Medical’s Current Report on Form 8-K filed on April 28, 2016.
10.1	Form of First Amendment to Severance Agreement between St. Jude Medical, Inc. and executive officers hired on or after December 10, 2012.
10.2	Form of Second Amendment to Severance Agreement between St. Jude Medical, Inc. and executive officers hired prior to December 10, 2012.
12	Computation of Ratio of Earnings to Fixed Charges.
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	Financial statements from the quarterly report on Form 10-Q of St. Jude Medical, Inc. for the quarter ended July 2, 2016, formatted in XBRL: (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to the Condensed Consolidated Financial Statements.

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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.

	ST. JUDE MEDICAL, INC.
August 3, 2016	/s/ DONALD J. ZURBAY
DATE	DONALD J. ZURBAY
	Vice President, Finance
	and Chief Financial Officer
	(Duly Authorized Officer and
	Principal Financial and
	Accounting Officer)

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INDEX TO EXHIBITS

Exhibit
No.	Description
2.1	Agreement and Plan of Merger, dated as of April 27, 2016, by and among St. Jude Medical, Inc., Abbott Laboratories, Vault Merger Sub, Inc. and Vault Merger Sub, LLC is incorporated by reference to Exhibit 2.1 to St. Jude Medical’s Current Report on Form 8-K filed on April 28, 2016.
3.1	Amendments to the Bylaws of St. Jude Medical, Inc., effective as of April 27, 2016, are incorporated by reference to Exhibit 3.2 to St. Jude Medical’s Current Report on Form 8-K filed on April 28, 2016.
10.1	Form of First Amendment to Severance Agreement between St. Jude Medical, Inc. and executive officers hired on or after December 10, 2012. #
10.2	Form of Second Amendment to Severance Agreement between St. Jude Medical, Inc. and executive officers hired prior to December 10, 2012. #
12	Computation of Ratio of Earnings to Fixed Charges. #
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. #
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. #
32.1	Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. #
32.2	Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. #
101	Financial statements from the quarterly report on Form 10-Q of St. Jude Medical, Inc. for the quarter ended July 2, 2016, formatted in XBRL: (i) the Condensed Consolidated Statements of Earnings, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to the Condensed Consolidated Financial Statements.

# Filed as an exhibit to this Quarterly Report on Form 10-Q.

43

EX-10.1

EXHIBIT 10.1

AMENDMENT TO SEVERANCE AGREEMENT

This Amendment (the “Amendment”) is made as of the 31^st day of May, 2016, between St. Jude Medical, Inc., a Minnesota corporation, with its principal offices at One St. Jude Medical Drive, St. Paul, Minnesota 55117 (the “Company”) and ________________ (“Executive”), and amends that certain Severance Agreement, dated________________, between Executive and the Company (the “Change in Control Severance Agreement”).

WITNESSETH THAT:

WHEREAS, the Change in Control Severance Agreement provides severance protection to Executive under certain circumstances solely in connection with a change in control;

WHEREAS, the Change in Control Severance Agreement does not provide for parachute tax gross-up payments;

WHEREAS, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Abbott Laboratories (“Parent”), Vault Merger Sub, Inc., a wholly owned subsidiary of Parent (“Merger Sub 1”) and Vault Merger Sub, LLC, a wholly owned subsidiary of Parent (“Merger Sub 2” and, together with Merger Sub 1, the “Merger Subs”) that provides for, among other things, the merger of Merger Sub 1 with and into the Company (the “First Merger”), with the Company surviving the First Merger and, promptly following the First Merger, the merger of the Company with and into Merger Sub 2 (the “Second Merger” and, together with the First Merger, the “Mergers”), with Merger Sub 2 surviving such Second Merger; and

WHEREAS, in consideration for (i) the retention of Executive during the period through at least the closing of the First Merger and (ii) Executive’s obligations to the Company pursuant to any agreement to refrain from performing services pursuant to an agreement containing a covenant not to compete or similar covenant, including the Noncompetition Agreement between the Company and Executive dated as of _____________ (the “Noncompetition Agreement”), the Company deems it advisable and in the best interests of the Company and its shareholders to provide additional protection and indemnification to Executive against potential excise taxes under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) in the event the First Merger is consummated.

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and Executive agree as follows:

1.     The words “Anything to the contrary notwithstanding” in the first sentence of Section 4(ii) are hereby deleted and replaced with the following:

(ii)    “Except as provided in Section 4(iii),”

2.    A new Section 4(iii) to the Change in Control Severance Agreement is hereby added to read in full as follows:

(iii)                              

(a)    In the event that any payment or benefit received or to be received by Executive either in connection with (x) the First Merger or (y) the termination of Executive’s employment during the term of Executive’s Change in Control Severance Agreement following the consummation of the First Merger (whether payable pursuant to the terms of the Change in Control Severance Agreement or any other plan, contract, agreement, program or arrangement with the Company, Parent or with any person constituting a member of an “affiliated group” as defined in Section 280G(d)(5) of the Code with the Company or Parent (collectively, the “Total Payments”)) would be subject to the excise tax imposed by Section 4999 of the Code, or any successor provision thereto, or any interest, penalties or additions to tax with respect to such excise tax (such excise tax, together with any such interest, penalties or additions to tax, are collectively referred to as the “Excise Tax”), then Executive shall be entitled to receive from the Company (or any successor) an additional cash payment (a “Gross-Up Payment”) which, subject to Section 14 of the Change

in Control Severance Agreement, shall be paid within thirty (30) business days of such determination in an amount such that after payment by Executive of all taxes (including any interest, penalties or additions to tax imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments. All determinations required to be made in connection with the foregoing, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment, shall be made by the independent accounting firm retained by the Company immediately prior to the time that the proposed transaction with Parent is consummated (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and Executive within fifteen (15) business days of Executive’s termination of employment, or such earlier time as is requested by the Company;

(b)    if the Accounting Firm determines that no Excise Tax is payable by Executive, it shall furnish the Company with an opinion that the Company has substantial authority not to report any Excise Tax on Executive’s Form W-2 or other applicable tax reporting form and shall furnish Executive with an opinion that Executive has substantial authority not to report any Excise Tax on Executive’s federal income tax return;

(c)    any uncertainty in the application of Section 4999 of the Code, or any successor provision thereto, at the time of the initial determination by the Accounting Firm hereunder shall be resolved in favor of Executive;

(d)    if, notwithstanding the initial determination of the Accounting Firm, Executive is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the underpayment of any Gross-Up Payment that has occurred, and any such underpayment shall be promptly paid by the Company to or for the benefit of Executive;

(e)    if, notwithstanding the initial determination of the Accounting Firm, it is discovered that an overpayment of any Gross-Up Payment has been made to Executive, (x) the Company shall deliver to Executive a written request for repayment (accompanied by updated detailed supporting calculations prepared by the Accounting Firm), (y) Executive shall refund the Company the amount of any overpayment, and (z) if Executive has not repaid such overpayment to the Company within a reasonable period of time following the receipt by Executive of the Company’s written request, the Company will take commercially reasonable steps to recover from Executive the amount of any overpayment that the Accounting Firm determines has occurred in connection with the foregoing;     

(f)    Executive shall cooperate with the Company in good faith in valuing, and the Accounting Firm shall take into account the value of, services provided or to be provided by Executive, including without limitation, Executive’s agreeing to refrain from performing services pursuant to a covenant not to compete or similar covenant before, on or after the date of a change in ownership or control of the Company (within the meaning of Q&A-2(b) of the final regulations under Section 280G of the Code), including pursuant to the Noncompete Agreement, such that payments in respect of such services may be considered reasonable compensation within the meaning of Q&A-9 and Q&A-40 to Q&A-44 of the final regulations under Section 280G of the Code and/or exempt from the definition of the term “parachute payment” within the meaning of Q&A-2(a) of the final regulations under Section 280G of the Code in accordance with Q&A-5(a) of the final regulations under Section 280G of the Code; and

(g)    any good faith determination by the Accounting Firm as to the amount of any Gross-Up Payment, including the amount of any Underpayment or Overpayment, shall be binding upon the Company and Executive.

(h)    The payments or benefits provided pursuant to this Amendment are governed by and subject to all of the terms and conditions of the remaining provisions of the Change in Control Severance Agreement to the extent not in direct conflict with this Amendment, including, without limitation, those listed below. For avoidance of doubt, nothing in this Amendment shall limit, abridge, amend, modify or otherwise affect Executive’s Change in Control Severance Agreement in a manner that is adverse to Executive.

(A)    Any payment not made to Executive when due hereunder shall thereafter, until paid in full, bear interest at the rate of interest equal to the reference rate announced from time to

time by Wells Fargo Bank Minnesota, National Association, plus two percent, with such interest to be paid to Executive upon demand or monthly in the absence of a demand;

(B)    Executive shall not be required to mitigate the amount of any payment provided for in this Amendment by seeking other employment or otherwise. The amount of any payment or benefit provided in this Amendment shall not be reduced by any other payment received by Executive from any source; and

(C)    The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company), by agreement in form and substance satisfactory to Executive, to expressly assume and agree to perform under this Amendment in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

(i)    Executive shall not be eligible for the foregoing benefits if Executive has voluntarily resigned or been terminated for “cause” prior to the closing of the First Merger.

3.    The existing Sections 4(iii) and 4(iv) are renumbered to 4(iv) and 4(v), respectively.

4.          Except as expressly provided herein, all other terms of the Change in Control Severance Agreement are unchanged by this Amendment and remain in full force and effect.

IN WITNESS WHEREOF, the Company has caused this Amendment to be executed in its name by a duly authorized officer, and Executive has hereunto set his or her hand, all as of the date first written above.

ST. JUDE MEDICAL, INC.

By

Its

EXECUTIVE

_____________________________________

EX-10.2

EXHIBIT 10.2

SECOND AMENDMENT TO SEVERANCE AGREEMENT

This Amendment (the “Amendment”) is made as of the 31^st day of May, 2016, between St. Jude Medical, Inc., a Minnesota corporation, with its principal offices at One St. Jude Medical Drive, St. Paul, Minnesota 55117 (the “Company”) and _____________ (“Executive”), and amends that certain Severance Agreement, dated_____________, between Executive and the Company, as amended by the First Amendment to Severance Agreement, dated_____________, (the “First Amendment” and collectively, the “Change in Control Severance Agreement”).

WITNESSETH THAT:

WHEREAS, the Change in Control Severance Agreement provides severance protection to Executive under certain circumstances solely in connection with a change in control;

WHEREAS, The First Amendment eliminated Executive’s right to parachute tax gross-up payments;

WHEREAS, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Abbott Laboratories (“Parent”), Vault Merger Sub, Inc., a wholly owned subsidiary of Parent (“Merger Sub 1”) and Vault Merger Sub, LLC, a wholly owned subsidiary of Parent (“Merger Sub 2” and, together with Merger Sub 1, the “Merger Subs”) that provides for, among other things, the merger of Merger Sub 1 with and into the Company (the “First Merger”), with the Company surviving the First Merger and, promptly following the First Merger, the merger of the Company with and into Merger Sub 2 (the “Second Merger” and, together with the First Merger, the “Mergers”), with Merger Sub 2 surviving such Second Merger; and

WHEREAS, in consideration for (i) the retention of Executive during the period through at least the closing of the First Merger and (ii) Executive’s obligations to the Company pursuant to any agreement to refrain from performing services pursuant to an agreement containing a covenant not to compete or similar covenant, including the Noncompetition Agreement between the Company and Executive dated as of _____________ (the “Noncompetition Agreement”), the Company deems it advisable and in the best interests of the Company and its shareholders to provide additional protection and indemnification to Executive against potential excise taxes under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) in the event the First Merger is consummated.

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and Executive agree as follows:

1.     The words “Anything to the contrary notwithstanding” in the first sentence of Section 4(ii) are hereby deleted and replaced with the following:

(ii)    “Except as provided in Section 4(iii),”

2.    A new Section 4(iii) to the Change in Control Severance Agreement is hereby added to read in full as follows:

(iii)                              

(a)    In the event that any payment or benefit received or to be received by Executive either in connection with (x) the First Merger or (y) the termination of Executive’s employment during the term of Executive’s Change in Control Severance Agreement following the consummation of the First Merger (whether payable pursuant to the terms of the Change in Control Severance Agreement or any other plan, contract, agreement, program or arrangement with the Company, Parent or with any person constituting a member of an “affiliated group” as defined in Section 280G(d)(5) of the Code with the Company or Parent (collectively, the “Total Payments”)) would be subject to the excise tax imposed by Section 4999 of the Code, or any successor provision thereto, or any interest, penalties or additions to tax with respect to such excise tax (such excise tax, together with any such interest, penalties or additions to tax, are collectively referred to as the “Excise Tax”), then Executive shall be entitled to receive from the Company (or any

successor) an additional cash payment (a “Gross-Up Payment”) which, subject to Section 14 of the Change in Control Severance Agreement, shall be paid within thirty (30) business days of such determination in an amount such that after payment by Executive of all taxes (including any interest, penalties or additions to tax imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments. All determinations required to be made in connection with the foregoing, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment, shall be made by the independent accounting firm retained by the Company immediately prior to the time that the proposed transaction with Parent is consummated (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and Executive within fifteen (15) business days of Executive’s termination of employment, or such earlier time as is requested by the Company;

(b)    if the Accounting Firm determines that no Excise Tax is payable by Executive, it shall furnish the Company with an opinion that the Company has substantial authority not to report any Excise Tax on Executive’s Form W-2 or other applicable tax reporting form and shall furnish Executive with an opinion that Executive has substantial authority not to report any Excise Tax on Executive’s federal income tax return;

(c)    any uncertainty in the application of Section 4999 of the Code, or any successor provision thereto, at the time of the initial determination by the Accounting Firm hereunder shall be resolved in favor of Executive;

(d)    if, notwithstanding the initial determination of the Accounting Firm, Executive is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the underpayment of any Gross-Up Payment that has occurred, and any such underpayment shall be promptly paid by the Company to or for the benefit of Executive;

(e)    if, notwithstanding the initial determination of the Accounting Firm, it is discovered that an overpayment of any Gross-Up Payment has been made to Executive, (x) the Company shall deliver to Executive a written request for repayment (accompanied by updated detailed supporting calculations prepared by the Accounting Firm), (y) Executive shall refund the Company the amount of any overpayment, and (z) if Executive has not repaid such overpayment to the Company within a reasonable period of time following the receipt by Executive of the Company’s written request, the Company will take commercially reasonable steps to recover from Executive the amount of any overpayment that the Accounting Firm determines has occurred in connection with the foregoing;     

(f)    Executive shall cooperate with the Company in good faith in valuing, and the Accounting Firm shall take into account the value of, services provided or to be provided by Executive, including without limitation, Executive’s agreeing to refrain from performing services pursuant to a covenant not to compete or similar covenant before, on or after the date of a change in ownership or control of the Company (within the meaning of Q&A-2(b) of the final regulations under Section 280G of the Code), including pursuant to the Noncompete Agreement, such that payments in respect of such services may be considered reasonable compensation within the meaning of Q&A-9 and Q&A-40 to Q&A-44 of the final regulations under Section 280G of the Code and/or exempt from the definition of the term “parachute payment” within the meaning of Q&A-2(a) of the final regulations under Section 280G of the Code in accordance with Q&A-5(a) of the final regulations under Section 280G of the Code; and

(g)    any good faith determination by the Accounting Firm as to the amount of any Gross-Up Payment, including the amount of any Underpayment or Overpayment, shall be binding upon the Company and Executive.

(h)    The payments or benefits provided pursuant to this Amendment are governed by and subject to all of the terms and conditions of the remaining provisions of the Change in Control Severance Agreement to the extent not in direct conflict with this Amendment, including, without limitation, those listed below. For avoidance of doubt, nothing in this Amendment shall limit, abridge, amend, modify or otherwise affect Executive’s Change in Control Severance Agreement in a manner that is adverse to Executive.

(A)    Any payment not made to Executive when due hereunder shall thereafter, until paid in full, bear interest at the rate of interest equal to the reference rate announced from time to

time by Wells Fargo Bank Minnesota, National Association, plus two percent, with such interest to be paid to Executive upon demand or monthly in the absence of a demand;

(B)    Executive shall not be required to mitigate the amount of any payment provided for in this Amendment by seeking other employment or otherwise. The amount of any payment or benefit provided in this Amendment shall not be reduced by any other payment received by Executive from any source; and

(C)    The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company), by agreement in form and substance satisfactory to Executive, to expressly assume and agree to perform under this Amendment in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

(i)    Executive shall not be eligible for the foregoing benefits if Executive has voluntarily resigned or been terminated for “cause” prior to the closing of the First Merger.

3.    The existing Sections 4(iii) and 4(iv) are renumbered to 4(iv) and 4(v), respectively.

4.          Except as expressly provided herein, all other terms of the Change in Control Severance Agreement are unchanged by this Amendment and remain in full force and effect.

IN WITNESS WHEREOF, the Company has caused this Amendment to be executed in its name by a duly authorized officer, and Executive has hereunto set his or her hand, all as of the date first written above.

ST. JUDE MEDICAL, INC.

By

Its

EXECUTIVE

_____________________________________

EX-12

EXHIBIT 12

ST. JUDE MEDICAL, INC.

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(amounts in millions of dollars)

	Six Months Ended		FISCAL YEAR
	July 2, 2016		2015		2014		2013		2012		2011
EARNINGS
Earnings before income taxes and noncontrolling interest	$	406	$	928	$	1,068	$	784	$	1,005	$	1,019
Plus fixed charges:
Interest expense (1)	80		103		85		81		73		70
Rent interest factor (2)	8		15		17		12		15		15
TOTAL FIXED CHARGES	88		118		102		93		88		85
EARNINGS BEFORE INCOME TAXES AND FIXED CHARGES	$	494	$	1,046	$	1,170	$	877	$	1,093	$	1,104
RATIO OF EARNINGS TO FIXED CHARGES	5.6		8.9		11.5		9.4		12.4		13.0

(1) Interest expense consists of interest on indebtedness and amortization of debt issuance costs but excludes interest on liabilities for uncertain tax positions.

(2) Approximately one-third of rental expense is deemed representative of the interest factor.

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Michael T. Rousseau, certify that:
1.	I have reviewed this quarterly report on Form 10-Q of St. Jude Medical, Inc.;
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 the registrant as of, and for, the periods presented in this report;
4.	The registrant'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 the registrant 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 the registrant, 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 the registrant'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 the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	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 the registrant'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 the registrant's internal control over financial reporting.

Date: August 3, 2016

/s/ MICHAEL T. ROUSSEAU

Michael T. Rousseau

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Donald J. Zurbay, certify that:
1.	I have reviewed this quarterly report on Form 10-Q of St. Jude Medical, Inc.;
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 the registrant as of, and for, the periods presented in this report;
4.	The registrant'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 the registrant 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 the registrant, 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 the registrant'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 the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	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 the registrant'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 the registrant's internal control over financial reporting.

Date: August 3, 2016

/s/ DONALD J. ZURBAY

Donald J. Zurbay

Vice President, Finance and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of St. Jude Medical, Inc. (the Company) on Form 10-Q for the period ended July 2, 2016 as filed with the Securities and Exchange Commission (the Report), I, Michael T. Rousseau, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 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/ MICHAEL T. ROUSSEAU

Michael T. Rousseau

President and Chief Executive Officer

August 3, 2016

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of St. Jude Medical, Inc. (the Company) on Form 10-Q for the period ended July 2, 2016 as filed with the Securities and Exchange Commission (the Report), I, Donald J. Zurbay, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 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/ DONALD J. ZURBAY

Donald J. Zurbay

Vice President, Finance and

Chief Financial Officer

August 3, 2016

XML

Document And Entity Information - shares	6 Months Ended
	Jul. 02, 2016	Jul. 29, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 02, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q2
Entity Registrant Name	ST JUDE MEDICAL INC
Entity Central Index Key	0000203077
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		284,929,332

XML

Condensed Consolidated Statements Of Earnings - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Income Statement [Abstract]
Net sales	$ 1,562	$ 1,410	$ 3,010	$ 2,755
Cost of sales:
Cost of sales before special charges	490	419	974	812
Special charges	6	5	9	7
Total cost of sales	496	424	983	819
Gross profit	1,066	986	2,027	1,936
Selling, general and administrative expense	502	447	993	877
Research and development expense	192	171	380	338
Amortization of intangible assets	46	24	92	48
Special charges	13	30	21	34
Operating profit	313	314	541	639
Interest income	0	0	(1)	(1)
Interest expense	40	20	80	41
Other (income) expense	3	0	56	(3)
Other expense, net	43	20	135	37
Earnings before income taxes and noncontrolling interest	270	294	406	602
Income tax expense	32	12	73	64
Net earnings before noncontrolling interest	238	282	333	538
Less: Net loss attributable to noncontrolling interest	0	(8)	0	(14)
Net earnings attributable to St. Jude Medical, Inc.	$ 238	$ 290	$ 333	$ 552
Net earnings per share attributable to St. Jude Medical, Inc.:
Basic (USD per share)	$ 0.84	$ 1.03	$ 1.17	$ 1.96
Diluted (USD per share)	0.83	1.02	1.16	1.93
Cash dividends declared per share (USD per share)	$ 0.31	$ 0.29	$ 0.62	$ 0.58
Weighted average shares outstanding:
Basic (in shares)	284.3	281.1	283.9	282.0
Diluted (in shares)	288.3	285.5	287.3	286.3

XML

Condensed Consolidated Statements Of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Statement of Comprehensive Income [Abstract]
Net earnings before noncontrolling interest	$ 238	$ 282	$ 333	$ 538
Other comprehensive income (loss), net of tax
Unrealized gain (loss) on available-for-sale securities, net of tax (expense) benefit $-, $1, $- and $1, respectively	1	(4)	1	(3)
Unrealized gain (loss) on derivative financial instruments, net of tax (expense) benefit of $1, $2, $16 and ($3), respectively	(4)	(17)	(34)	12
Foreign currency translation adjustment	(17)	30	31	(97)
Other comprehensive income (loss), net of tax	(20)	9	(2)	(88)
Total comprehensive income before noncontrolling interest	218	291	331	450
Total comprehensive loss attributable to noncontrolling interest	0	(8)	0	(14)
Total comprehensive income attributable to St. Jude Medical, Inc.	$ 218	$ 299	$ 331	$ 464

XML

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Statement of Comprehensive Income [Abstract]
Tax (expense) benefit on related to increase (decrease) in accumulated gain (loss) from unrealized gain (loss) on available-for-sale securities	$ 0	$ 1	$ 0	$ 1
Tax (expense) benefit on related to increase (decrease) in accumulated gain (loss) from derivative instruments designated and qualifying as the effective portion of cash flow hedges	$ 1	$ 2	$ 16	$ (3)

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Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
ASSETS
Cash and cash equivalents	$ 398	$ 667
Accounts receivable, less allowance for doubtful accounts of $46 at both July 2, 2016 and January 2, 2016	1,330	1,237
Finished goods	563	609
Work in process	105	102
Raw materials	236	198
Inventories	904	909
Other current assets	295	269
Total current assets	2,927	3,082
Property, plant and equipment, at cost	2,888	2,767
Less: Accumulated depreciation	(1,562)	(1,447)
Net property, plant and equipment	1,326	1,320
Goodwill	5,670	5,651
Intangible assets, net	2,146	2,226
Other assets	589	621
TOTAL ASSETS	12,658	12,900
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current debt obligations	660	1,163
Accounts payable	242	201
Income taxes payable	0	201
Other current liabilities	811	901
Total current liabilities	1,713	2,466
Long-term debt	5,431	5,229
Other liabilities	1,233	1,163
Total liabilities	8,377	8,858
Commitments and Contingencies	0	0
Shareholders’ Equity
Preferred stock ($1.00 par value; 25,000,000 shares authorized; none outstanding)	0	0
Common stock ($0.10 par value; 500,000,000 shares authorized; 284,596,998 and 283,450,374 shares issued and outstanding at July 2, 2016 and January 2, 2016, respectively)	28	28
Additional paid-in capital	232	148
Retained earnings	4,368	4,211
Accumulated other comprehensive income (loss)	(347)	(345)
Total shareholders’ equity	4,281	4,042
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 12,658	$ 12,900

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Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
Statement of Financial Position [Abstract]
Accounts receivable allowance for doubtful accounts	$ 46	$ 46
Preferred stock, par value (USD per share)	$ 1	$ 1
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares outstanding	0	0
Common stock, par value (USD per share)	$ 0.1	$ 0.1
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	284,596,998	283,450,374
Common stock, shares outstanding	284,596,998	283,450,374

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Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Millions	6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015
OPERATING ACTIVITIES
Net earnings before noncontrolling interest	$ 333	$ 538
Adjustments to reconcile net earnings before noncontrolling interest to net cash from operating activities:
Depreciation of property, plant and equipment	116	108
Amortization of intangible assets	92	48
Stock-based compensation	60	37
Deferred income taxes	(29)	(17)
Other, net	104	(67)
Changes in operating assets and liabilities, net of business combinations:
Accounts receivable	(63)	(87)
Inventories	(18)	(53)
Other current and noncurrent assets	(53)	(11)
Accounts payable and accrued expenses	43	(35)
Income taxes payable	(122)	(20)
Net cash provided by operating activities	463	441
INVESTING ACTIVITIES
Purchases of property, plant and equipment	(114)	(80)
Business combination payments, net of cash acquired	(11)	0
Proceeds from sale of investments	0	8
Other investing activities, net	(4)	(4)
Net cash used in investing activities	(129)	(76)
FINANCING ACTIVITIES
Proceeds from exercise of stock options and stock issued, net	22	89
Excess tax benefits from stock issued under employee stock plans	3	14
Common stock repurchased, including related costs	0	(500)
Dividends paid	(170)	(158)
Issuances (payments) of commercial paper borrowings, net	(117)	460
Proceeds from debt	500	175
Payments of debt	(726)	(750)
Purchase of shares from noncontrolling interest	0	(173)
Payment of contingent consideration	(125)	0
Other financing activities, net	0	(15)
Net cash provided by (used in) financing activities	(613)	(858)
Effect of currency exchange rate changes on cash and cash equivalents	10	(39)
Net increase (decrease) in cash and cash equivalents	(269)	(532)
Cash and cash equivalents at beginning of period	667	1,442
Cash and cash equivalents at end of period	$ 398	$ 910

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Basis Of Presentation

6 Months Ended

Jul. 02, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis Of Presentation

BASIS OF PRESENTATION

Principles of Consolidation: The accompanying unaudited Condensed Consolidated Financial Statements of St. Jude Medical, Inc. (St. Jude Medical or the Company) have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (U.S. generally accepted accounting principles) for complete financial statements. In the opinion of management, these statements include all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the Company’s consolidated results of operations, financial position and cash flows. The Condensed Consolidated Balance Sheet at January 2, 2016 was derived from audited annual financial statements, but does not contain all of the footnote disclosures from the annual financial statements. Operating results for any interim period are not necessarily indicative of the results that may be expected for the full year. Preparation of the Company’s financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts in the financial statements and footnotes. Actual results could differ from those estimates. This Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and footnotes included in its Current Report on Form 8-K filed with the SEC on June 7, 2016 for the fiscal year ended January 2, 2016.

The unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries, and other entities for which St. Jude Medical has a controlling financial interest.

Effective January 1, 2016, the Company's Board of Directors appointed a new President and Chief Executive Officer whom the Company has determined to be its Chief Operating Decision Maker. During the first quarter of 2016, the Company changed its sales reporting to closely align with how it manages the business in five key areas: Traditional Cardiac Rhythm Management, Heart Failure, Atrial Fibrillation, Cardiovascular and Neuromodulation. The Company continues to operate as a single operating segment.

Reclassifications: Certain prior period amounts have been reclassified to conform to current year presentation.

Fiscal Year: We utilize a 52/53-week fiscal year ending on the Saturday nearest December 31st. Each of the three-and six month periods ended July 2, 2016 and July 4, 2015 included 13 weeks and 26 weeks, respectively.

New Accounting Pronouncements: The following table provides a description of recent accounting pronouncements adopted and those standards not yet adopted with potential for a material impact on the Company's financial statements or disclosures.

Standard	Description	Required adoption timing and approach	Impact of adoption or other significant matters
Standards recently adopted
Accounting Standards Update (ASU) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis	The standard affects both the variable interest entity and voting interest entity consolidation models.	Annual and interim periods beginning after December 15, 2015, with either retrospective or modified retrospective application permitted. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the modified retrospective method. The adoption did not have a material impact on the Company's results of operations or financial position.

ASU No. 2015-05, Intangibles--Goodwill and Other--Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement	The standard provides guidance to customers about how to account for cloud computing arrangements when such arrangements include software licenses.	Annual and interim periods beginning after December 15, 2015, with either prospective or retrospective application permitted. Early adoption was permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the prospective method. The adoption did not have a material impact on the Company's results of operations or financial position.
ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory	The standard requires that inventory within the scope of the guidance be measured at the lower of cost or net realizable value.	Annual and interim periods beginning after December 15, 2016, with prospective application required. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016. The adoption did not have a material impact on the Company's results of operations or financial position.
Standards not yet adopted
ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606)	The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance will supersede the current revenue recognition requirements.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.
ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date	The standard defers the effective date of ASU No. 2014-09 to annual and interim periods beginning after December 15, 2017. Early adoption is permitted only as of annual and interim reporting periods beginning after December 15, 2016.	Not applicable.	Not applicable.
ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	Among other things, the standard requires certain equity investments to be measured at fair value with changes in fair value recognized in net income, simplifies the impairment assessment of equity investments without readily determinable fair values, and eliminates certain disclosure requirements.	Annual and interim periods beginning after December 15, 2017. Early adoption of certain guidance is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.
ASU No. 2016-02, Leases (Topic 842)	Among other things, the standard requires recognition of a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position for virtually all leases where we are the lessee.	Annual and interim periods beginning after December 15, 2018, with modified retrospective application required. Early adoption is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.

ASU No. 2016-09, Compensation--Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	The areas for simplification in this standard involve several aspects of the accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.	Annual and interim periods beginning after December 15, 2016, with certain aspects requiring modified retrospective transition, retrospective application, and/or prospective application. Early adoption is permitted if all aspects are adopted simultaneously.	The Company is evaluating the timing of adoption and the potential impact to its results of operations, financial position and cash flows.
ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing	Among other things, the standard clarifies the principle for determining whether a good or service is “separately identifiable” from other promises in the contract and, therefore, should be accounted for separately. It also clarifies that entities are not required to identify promised goods or services that are immaterial in the context of the contract.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.

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Debt

6 Months Ended

Jul. 02, 2016

Debt Disclosure [Abstract]

Debt

DEBT

The carrying value of the Company’s debt, including debt issuance costs, discounts or premiums consisted of the following (in millions):

	July 2, 2016		January 2, 2016
Term Loan Due 2020	$	2,368	$	2,093
2016 Senior Notes	—		500
2018 Senior Notes	497		496
2020 Senior Notes	496		496
2023 Senior Notes	892		892
2025 Senior Notes	494		494
2043 Senior Notes	690		689
Yen-denominated Senior Notes Due 2017	79		68
Yen-denominated Senior Notes Due 2020	124		106
Yen-denominated credit facilities	64		54
Commercial paper borrowings	387		504
Total debt	6,091		6,392
Less: current debt obligations	660		1,163
Long-term debt	$	5,431	$	5,229

Contractual maturities of the Company's debt for the next five fiscal years and thereafter, excluding any debt issuance costs, discounts or premiums, as of July 2, 2016 were as follows (in millions):

	Remainder of 2016		2017		2018		2019		2020		After 2020
Future minimum principal payments	$	453	$	272	$	598	$	227	$	2,478	$	2,100

During the first six months of 2016, the Company repaid its $500 million principal amount of 5-year, 2.500% unsecured senior notes due 2016, made net commercial paper payments of $117 million and drew the remaining $500 million of its 5-year, $2.6 billion term loan due 2020 (Term Loan Due 2020) to refinance existing indebtedness and for general corporate purposes. The Company also made quarterly principal payments totaling $59 million for the six months ended July 2, 2016 and prepaid an additional $167 million on its Term Loan Due 2020. Additionally, the Company's yen-denominated credit facility that expired in March 2016 for 3.25 billion Japanese Yen (the equivalent of $32 million as of July 2, 2016) was automatically extended for a one-year period bearing interest at Yen LIBOR plus 0.250%, and the Company's yen-denominated credit facility that expired in June 2016 for 3.25 billion Japanese Yen (the equivalent of $32 million as of July 2, 2016) was automatically extended for a one-year period bearing interest at Yen LIBOR plus 0.270%.

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Commitments And Contingencies

6 Months Ended

Jul. 02, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments And Contingencies

COMMITMENTS AND CONTINGENCIES

Securities and Other Shareholder Litigation

December 2012 Securities Litigation: On December 7, 2012, a putative securities class action lawsuit was filed in federal district court in Minnesota against the Company and an officer (collectively, the defendants) for alleged violations of the federal securities laws, on behalf of all purchasers of the publicly traded securities of the defendants between October 17, 2012 and November 20, 2012. The complaint, which sought unspecified damages and other relief as well as attorneys' fees, challenges the Company’s disclosures concerning its high voltage cardiac rhythm lead products during the purported class period. On December 10, 2012, a second putative securities class action lawsuit was filed in federal district court in Minnesota against the Company and certain officers for alleged violations of the federal securities laws, on behalf of all purchasers of the publicly traded securities of the Company between October 19, 2011 and November 20, 2012. The second complaint alleged similar claims and sought similar relief. In March 2013, the Court consolidated the two cases and appointed a lead counsel and lead plaintiff. A consolidated amended complaint was served and filed in June 2013, alleging false or misleading representations made during the class period extending from February 5, 2010 through November 7, 2012. In September 2013, the defendants filed a motion to dismiss the consolidated amended complaint. On March 10, 2014, the Court ruled on the motion to dismiss, denying the motion in part and granting the motion in part. On October 7, 2014, the lead plaintiff filed a second amended complaint. Like the original consolidated amended complaint, the plaintiffs did not assert any specific amount of compensation in the second amended complaint. The Court granted class certification on December 22, 2015. On May 24, 2016, the parties agreed to resolve the case, pending notification to class members and subject to court approval. Under the settlement, the Company agreed to make a payment of $39.25 million to resolve all of the class claims and recorded a charge of that amount during the second quarter of 2016. On July 13, 2016, the Court issued an order preliminarily approving the settlement. Concurrent with the recording of the loss, the Company also recognized probable insurance recoveries of $39.25 million.

Abbott Merger Lawsuits: On May 2, 2016, a shareholder of the Company filed a purported class action lawsuit in Ramsey County, Minnesota, captioned Silverman v. St. Jude Medical, Inc., et al., 62-CV-16-2872 alleging that the Company's directors breached their fiduciary duties in connection with the proposed merger contemplated by the Company and Abbott Laboratories (Abbott) (the Proposed Transaction). On May 26, 2016, a second action entitled Larkin v. Starks, et al., 62-CV-16-3367, was filed in the same court alleging substantially similar claims. On July 5, 2016, plaintiffs in the two actions jointly filed an Amended Shareholder class and Derivative Action Complaint (the Amended Complaint). Plaintiffs’ Amended Complaint asserts that the Company’s directors breached their fiduciary duties by conducting a flawed sale process, failing to maximize shareholder value, and publishing false or misleading disclosure materials relating to the Proposed Transaction, and that the Abbott defendants aided and abetted those breaches. The Amended Complaint asserts direct and/or derivative claims for breach of fiduciary duty, corporate waste and abuse of control under Minnesota Statute § 302A.467. Plaintiffs seek, among other things, to enjoin the Proposed Transaction and an order directing defendants to account to plaintiffs for all damages allegedly suffered by the putative class and damages allegedly incurred by the Company in connection with the Proposed Transaction. On June 30, 2016, a shareholder of the Company filed a purported class action lawsuit in the United States District Court for the District of Minnesota, captioned Rosenfeld v. St. Jude Medical, Inc., et al., 16-cv-02275-WMW-FLN, alleging that the Company and its directors violated Section 14(a) of the Securities Exchange Act of 1934, SEC Rule 14a-9, and Minnesota Statute §§ 80A.68 and 80A.76, and that the Company’s directors violated Section 20(a) of the Exchange Act, by filing a Form S-4 with the SEC that contained false or misleading statements regarding the Proposed Transaction. Plaintiff seeks, among other things, to enjoin the Proposed Transaction or, if consummated, an order rescinding it or awarding actual and punitive damages to Plaintiff and the putative class.

The Company and its directors intend to vigorously defend against the allegations in these actions involving the Abbott merger. The Company believes that a material loss is remote. Refer to Note 11 for a discussion of the Proposed Transaction.

Regulatory Matters

The U.S. Food and Drug Administration (FDA) inspected the Company’s manufacturing facility in Atlanta, Georgia, where the Company manufactures its CardioMEMS™ HF system, at various times between June 8 to June 26, 2015. On July 6, 2015, the FDA issued a Form 483 identifying certain observed non-conformity with current Good Manufacturing Practice at the facility. Following the receipt of the Form 483, the Company provided written responses to the FDA detailing proposed corrective actions and immediately initiated efforts to address the FDA’s observations of non-conformity. The Company subsequently received a warning letter dated September 30, 2015 from the FDA relating to these non-conformities. Since the completion of the FDA inspection, the Company has provided and will continue to provide the FDA with regular updates. The Company has fully-integrated this former CardioMEMS standalone facility into St. Jude Medical's quality systems. During July 2016, the FDA conducted a follow-up inspection at the Atlanta facility. On July 28, 2016, the FDA issued a Form 483 identifying additional observed non-conformities with current Good Manufacturing Practice at the facility. The Company will continue to work to remediate these observations. The warning letter is specific to the Atlanta facility and does not impact any of the Company’s other manufacturing facilities. The warning letter does not identify any specific concerns regarding the performance of, or indicate the need for any field or other action regarding, the CardioMEMS™HF system product or any other St. Jude Medical product. The Company will continue manufacturing and shipping product from the Atlanta facility, and customer orders are not expected to be impacted while the Company works to resolve the FDA’s concerns. The Company takes these matters seriously, will respond timely and fully to the FDA’s requests, and believes that the FDA’s concerns will be resolved without a material impact on the Company’s financial results.

Product Warranties

The Company offers a warranty on various products, the most significant of which relate to tachycardia implantable cardioverter defibrillator (ICD) and pacemaker systems. The Company estimates the costs it expects to incur under its warranties and records a liability for such costs at the time the product is sold. Factors that affect the Company's warranty liability include the number of units sold, historical and anticipated rates of warranty claims and cost per claim. The Company regularly assesses the adequacy of its warranty liabilities and adjusts the amounts as necessary.

Changes in the Company’s product warranty liability during the three and six months ended July 2, 2016 and July 4, 2015 were as follows (in millions):

	Three Months Ended						Six Months Ended
	July 2, 2016			July 4, 2015			July 2, 2016			July 4, 2015
Balance at beginning of period	$	26		$	32		$	31		$	35
Warranty expense (benefit) recognized	2			(2		)	1			(4		)
Warranty credits issued	(3		)	(1		)	(7		)	(2		)
Balance at end of period	$	25		$	29		$	25		$	29

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Special Charges

6 Months Ended

Jul. 02, 2016

Special Charges [Abstract]

Special Charges

SPECIAL CHARGES

The Company recognizes certain transactions and events as special charges in its Condensed Consolidated Financial Statements. These charges (such as restructuring charges, impairment charges, certain legal settlements or product field action costs and litigation costs) result from facts and circumstances that vary in frequency and impact on the Company's results of operations.

2016 Initiatives

During the fourth quarter of 2015, the Company initiated restructuring activities to drive cross-functional synergies (the 2016 Initiatives). The 2016 Initiatives include enhancing focus on programs that will strengthen its strategic objectives, driving productivity enhancements and incurring costs to fully integrate its recent acquisitions. During 2015, the Company incurred charges of $34 million primarily related to severance and other termination benefits.

During the first quarter of 2016, the Company incurred additional charges of $24 million related to severance and other termination benefits, contract termination costs and fixed asset write-offs, primarily associated with the closure of legacy Thoratec Corporation (Thoratec) facilities as the Company continues to integrate the acquisition.

During the second quarter of 2016, the Company incurred additional charges of $12 million related to severance and other termination benefits, distributor contract terminations and other Thoratec-related contract terminations. The Company currently expects to incur approximately $20 million to $25 million during the remainder of 2016 to complete the plan, but may incur additional charges in future periods.

A summary of the activity related to the 2016 Initiatives accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	—		$	—		$	—		$	—		$	—
Cost of sales special charges	9			1			1			1			12
Special charges	22			—			—			—			22
Non-cash charges used	—			(1		)	(1		)	—			(2		)
Cash payments	(2		)	—			—			(1		)	(3		)
Balance at January 2, 2016	29			—			—			—			29
Cost of sales special charges	—			2			1			1			4
Special charges	11			—			4			5			20
Non-cash charges used	—			(2		)	(5		)	—			(7		)
Cash payments	(32		)	—			—			(5		)	(37		)
Balance at April 2, 2016	8			—			—			1			9
Cost of sales special charges	—			—			—			2			2
Special charges	6			—			—			4			10
Cash payments	(6		)	—			—			(4		)	(10		)
Balance at July 2, 2016	$	8		$	—		$	—		$	3		$	11

Manufacturing and Supply Chain Optimization Plan

During 2014, the Company initiated the Manufacturing and Supply Chain Optimization Plan to leverage economies of scale, streamline distribution methods, drive process improvements through global synergies, balance plant utilization levels, centralize certain vendor relationships and reduce overall costs. During 2015, the Company incurred charges of $78 million primarily related to severance and other termination benefits, contract termination costs and fixed asset write-offs. These costs included charges associated with the elimination of certain operational, quality and hardware development activities at a research and development facility, continued exit costs related to a facility closure in the United States and software development assets no longer expected to be utilized.

During the first and second quarters of 2016, the Company incurred additional charges of $1 million and $2 million, respectively, primarily related to continued exit costs associated with a facility closure in the United States. Material charges are not expected in future periods as the Manufacturing and Supply Chain Optimization Plan is now complete.

A summary of the activity related to the Manufacturing and Supply Chain Optimization Plan accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	14		$	—		$	—		$	6		$	20
Cost of sales special charges	4			3			15			7			29
Special charges	20			—			—			29			49
Non-cash charges used	—			(3		)	(15		)	—			(18		)
Cash payments	(27		)	—			—			(35		)	(62		)
Balance at January 2, 2016	11			—			—			6			17
Cost of sales special charges	—			—			—			1			1
Cash payments	(3		)	—			—			(6		)	(9		)
Balance at April 2, 2016	8			—			—			1			9
Cost of sales special charges	—			—			—			1			1
Special charges	—			—			—			1			1
Cash payments	(3		)	—			—			(2		)	(5		)
Balance at July 2, 2016	$	5		$	—		$	—		$	1		$	6

2012 Business Realignment Plan

During 2012, the Company realigned its product divisions into two new operating divisions: the Implantable Electronic Systems Division (combining its legacy Cardiac Rhythm Management and Neuromodulation product divisions) and the Cardiovascular and Ablation Technologies Division (combining its legacy Cardiovascular and Atrial Fibrillation product divisions). In addition, the Company centralized certain support functions, including information technology, human resources, legal, business development and certain marketing functions. The organizational changes have been part of a comprehensive plan to accelerate the Company's growth, reduce costs, leverage economies of scale and increase investment in product development. During 2014, the Company announced additional organizational changes including the combination of its Implantable Electronic Systems Division and Cardiovascular and Ablation Technologies Division, resulting in an integrated research and development (R&D) organization and a consolidation of manufacturing and supply chain operations worldwide.

During 2015, the Company incurred additional charges of $14 million primarily related to severance and other termination benefits and other restructuring costs, including contract termination costs, asset relocation expenses and other exit costs predominately associated with the facility closure in Europe.

During the first quarter of 2016, the Company reassessed the remaining accrual balance and determined that some of the previously recorded accrual balances were no longer necessary. No additional charges are expected in future periods as the 2012 Business Realignment Plan is now complete.

A summary of the activity related to the 2012 Business Realignment Plan accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	26		$	—		$	—		$	12		$	38
Cost of sales special charges	2			3			—			—			5
Special charges	2			—			2			5			9
Non-cash charges used	—			(3		)	(2		)	—			(5		)
Cash payments	(25		)	—			—			(10		)	(35		)
Foreign exchange rate impact	(2		)	—			—			—			(2		)
Balance at January 2, 2016	3			—			—			7			10
Cost of sales special charges	—			(1		)	—			(1		)	(2		)
Non-cash charges used	—			1			—			—			1
Balance at April 2, 2016	3			—			—			6			9
Cash payments	(1		)	—			—			—			(1		)
Balance at July 2, 2016	$	2		$	—		$	—		$	6		$	8

Other Special Charges

Legal settlements: During the first quarter of 2016, the Company recognized $19 million of legal settlement gains related to two separate legal cases. These gains were partially offset by a $2 million contingent loss related to a litigation matter that the Company now believes is probable and estimable.

During the second quarter of 2016, the Company recognized a $39.25 million legal settlement loss related to the December 2012 Securities Litigation. Concurrent with the recording of the loss, the Company also recognized probable insurance recoveries of $39.25 million (see Note 3). The Company also recognized a $2 million legal settlement gain related to a separate legal case during the second quarter of 2016.

During the first quarter of 2015, the Company recognized $10 million in insurance recoveries as a special benefit in connection with the March 2010 Securities Class Action Litigation.

Product field action costs and litigation costs: During both the first and second quarters of 2016, the Company recognized approximately $3 million of litigation charges for expected future probable and estimable legal costs associated with outstanding legal matters related to the Company's product field actions. During the first and second quarters of 2015, the Company recognized approximately $5 million and $3 million, respectively, of litigation charges for expected future probable and estimable legal costs associated with outstanding legal matters related to the Company's product field actions. Charges in excess of the amounts accrued are reasonably possible and depend on a number of factors, such as the type of claims received and the cost to defend.

During the second quarter of 2016, the Company initiated an advisory letter to physicians for patients implanted with certain ICD devices that were identified as having a potential therapy anomaly resulting in a lack of necessary treatment. As a result, the Company recognized charges of $5 million to cost of sales special charges primarily for estimated scrapped inventory and warranty costs. Partially offsetting these charges, the Company recognized a $2 million benefit during the second quarter of 2016 to cost of sales special charges for salvaged inventory components related to an advisory action initiated in 2014. Additionally, the Company recognized a $2 million benefit in both the first and second quarters of 2015 to cost of sales special charges, for salvaged inventory components related to the same advisory action initiated in 2014.

Other restructuring-related charges: The Company also recognized other restructuring-related charges of $2 million and $1 million during the first and second quarters of 2016, respectively.

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Net Earnings Per Share

6 Months Ended

Jul. 02, 2016

Earnings Per Share [Abstract]

Net Earnings Per Share

NET EARNINGS PER SHARE

The table below sets forth the computation of basic and diluted net earnings per share attributable to St. Jude Medical, Inc. (in millions, except per share amounts):

	Three Months Ended				Six Months Ended
	July 2, 2016		July 4, 2015		July 2, 2016		July 4, 2015
Numerator:
Net earnings attributable to St. Jude Medical, Inc.	$	238	$	290	$	333	$	552
Denominator:
Basic weighted average shares outstanding	284.3		281.1		283.9		282.0
Dilution associated with stock-based compensation plans	4.0		4.4		3.4		4.3
Diluted weighted average shares outstanding	288.3		285.5		287.3		286.3
Basic net earnings per share attributable to St. Jude Medical, Inc.	$	0.84	$	1.03	$	1.17	$	1.96
Diluted net earnings per share attributable to St. Jude Medical, Inc.	$	0.83	$	1.02	$	1.16	$	1.93
Anti-dilutive shares of common stock excluded from diluted net earnings per share attributable to St. Jude Medical, Inc.	3.8		2.6		6.1		3.4

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Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information

6 Months Ended

Jul. 02, 2016

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) AND SUPPLEMENTAL EQUITY INFORMATION

The tables below present the changes in each component of accumulated other comprehensive income, net of tax, including other comprehensive income and reclassifications out of accumulated other comprehensive income into net earnings for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the three months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 2, 2016	$	3	$	(19	)	$	(311	)	$	(327	)
Other comprehensive income (loss) before reclassifications	1		(4		)	(17		)	(20		)
Amounts reclassified to net earnings from accumulated other comprehensive income	—		—			—			—
Other comprehensive income (loss)	1		(4		)	(17		)	(20		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the six months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of January 2, 2016	$	3	$	11		$	(359	)	$	(345	)
Other comprehensive income (loss) before reclassifications	1		(30		)	31			2
Amounts reclassified to net earnings from accumulated other comprehensive income	—		(4		)	—			(4		)
Other comprehensive income (loss)	1		(34		)	31			(2		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

	Unrealized
	Gain (Loss) On			Unrealized			Foreign			Accumulated
	Available-for-			Gain (Loss) On			Currency			Other
For the three months ended July 4, 2015	sale Securities			Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 4, 2015	$	16		$	32		$	(318	)	$	(270	)
Other comprehensive income (loss) before reclassifications	(2		)	(13		)	30			15
Amounts reclassified to net earnings from accumulated other comprehensive income	(2		)	(4		)	—			(6		)
Other comprehensive income (loss)	(4		)	(17		)	30			9
Accumulated other comprehensive income (loss) as of July 4, 2015	$	12		$	15		$	(288	)	$	(261	)
	Unrealized
	Gain (Loss) On			Unrealized			Foreign			Accumulated
	Available-for-			Gain (Loss) On			Currency			Other
For the six months ended July 4, 2015	sale Securities			Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of January 3, 2015	$	15		$	3		$	(191	)	$	(173	)
Other comprehensive income (loss) before reclassifications	1			16			(97		)	(80		)
Amounts reclassified to net earnings from accumulated other comprehensive income	(4		)	(4		)	—			(8		)
Other comprehensive income (loss)	(3		)	12			(97		)	(88		)
Accumulated other comprehensive income (loss) as of July 4, 2015	$	12		$	15		$	(288	)	$	(261	)

Income taxes are not provided for foreign translation related to permanent investments in international subsidiaries. Reclassification adjustments are made to avoid double counting items in comprehensive income that are also recorded as part of net earnings.

The following table provides details about reclassifications out of accumulated other comprehensive income and the line items impacted in the Company's Condensed Consolidated Statements of Earnings during the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

Details about	Amount reclassified from accumulated other comprehensive income
accumulated other	Three Months Ended					Six Months Ended
comprehensive income components	July 2, 2016		July 4, 2015			July 2, 2016			July 4, 2015			Statements of Earnings Classification
Unrealized (gain) loss on available-for-sale securities:
(Gain) loss on sale of available-for-sale securities	$	—	$	(3	)	$	—		$	(7	)	Other (income) expense
Tax effect	—		1			—			3			Income tax expense
Net of tax	$	—	$	(2	)	$	—		$	(4	)
Unrealized (gain) loss on derivative financial instruments:
(Gain) loss recognized on derivative financial instruments	$	—	$	(4	)	$	(6	)	$	(4	)	Cost of sales
Tax effect	—		—			2			—			Income tax expense
Net of tax	$	—	$	(4	)	$	(4	)	$	(4	)

The Company's realized (gains) and losses on its available-for-sales securities and derivative financial instruments are computed using the specific identification method.

Supplemental Equity Information

On May 4, 2016, the Company's Board of Directors authorized a cash dividend of $0.31 per share which was paid on July 29, 2016 to shareholders of record as of June 30, 2016.

On January 13, 2015, the Company authorized a share repurchase program of up to $500 million of its outstanding common stock. The Company began repurchasing shares on January 30, 2015. From January 30, 2015 through March 2, 2015, the Company repurchased approximately 7.5 million shares for $500 million at an average repurchase price of $66.96 per share.

In June 2013, the Company made an equity investment of $40 million in Spinal Modulation, a privately-held company that is focused on the development of an intraspinal neuromodulation therapy that delivers spinal cord stimulation targeting the dorsal root ganglion to manage chronic pain. The investment agreement resulted in a 19% voting equity interest and provided the Company with the exclusive right, but not the obligation, to acquire Spinal Modulation. Additionally, in connection with the investment and contingent acquisition agreement, the Company also entered into an exclusive international distribution agreement, and obtained significant decision-making rights over Spinal Modulation's operations and economic performance. Accordingly, effective June 7, 2013, the Company determined that Spinal Modulation was a variable interest entity for which St. Jude Medical was the primary beneficiary with the financial condition and results of operations of Spinal Modulation included in St. Jude Medical's Condensed Consolidated Financial Statements.

During the second quarter of 2015, the Company exercised its exclusive option and paid $173 million to Spinal Modulation’s shareholders to acquire the remaining 81% ownership interest in the company that it did not previously own and accrued $155 million of contingent consideration (see Note 8). The $173 millionpaid in the second quarter of 2015 was classified as a financing activity in the Condensed Consolidated Statement of Cash Flows. As the Company retained its controlling interest, the payment for the shares and the accrual for contingent consideration resulted in a decrease in shareholders' equity before noncontrolling interest of $297 million and a decrease in noncontrolling interest of $33 million in St. Jude Medical's Condensed Consolidated Balance Sheets. Spinal Modulation's results of operations continue to be included in the Company's Condensed Consolidated Financial Statements.

The supplemental equity schedules below present changes in the Company's noncontrolling interest and total shareholders' equity for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Total
	Shareholders'
	Equity
	Before					Total
	Noncontrolling			Noncontrolling		Shareholders'
For the six months ended July 2, 2016	Interest			Interest		Equity
Balance at January 2, 2016	$	4,042		$	—	$	4,042
Net earnings	333			—		333
Other comprehensive income (loss)	(2		)	—		(2		)
Cash dividends declared	(176		)	—		(176		)
Stock-based compensation	60			—		60
Common stock issued under employee stock plans and other, net	22			—		22
Tax benefit from stock plans	2			—		2
Balance at July 2, 2016	$	4,281		$	—	$	4,281

	Total
	Shareholders'
	Equity
	Before						Total
	Noncontrolling			Noncontrolling			Shareholders'
For the six months ended July 4, 2015	Interest			Interest			Equity
Balance at January 3, 2015	$	4,199		$	45		$	4,244
Net earnings	552			(14		)	538
Other comprehensive income (loss)	(88		)	—			(88		)
Cash dividends declared	(163		)	—			(163		)
Repurchases of common stock	(500		)	—			(500		)
Stock-based compensation	35			2			37
Common stock issued under employee stock plans and other, net	89			—			89
Tax benefit from stock plans	14			—			14
Additions (purchases) of noncontrolling ownership interests	(297		)	(33		)	(330		)
Balance at July 4, 2015	$	3,841		$	—		$	3,841

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Income Taxes

6 Months Ended

Jul. 02, 2016

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

As of July 2, 2016, the Company had $405 million accrued for uncertain tax positions, all of which would affect the Company’s effective tax rate if recognized. Additionally, the Company had $56 million accrued for gross interest and penalties as of July 2, 2016. At January 2, 2016, the liability for uncertain tax positions was $338 million and the accrual for gross interest and penalties was $58 million.

The Company is subject to U.S. federal income tax as well as income tax of multiple state and foreign jurisdictions. The Company has substantially concluded all material U.S. federal, state, foreign and local income tax matters for all tax years through 2004. In April 2015, the U.S. Internal Revenue Service (IRS) completed an audit of the Company’s 2010 and 2011 tax returns and proposed adjustments in an audit report. In February 2014, the IRS completed an audit of the Company’s 2008 and 2009 tax returns and also proposed adjustments in an audit report.

The Company's effective income tax rate was 11.9% and 4.1% for the second quarter of 2016 and 2015, respectively, and 18.0% and 10.6% for the six months ended during 2016 and 2015, respectively. The Company’s effective income tax rate differs from the U.S. federal statutory rate each year due to certain operations that are subject to tax incentives, state and local taxes and foreign taxes that are different than the U.S. federal statutory rate. In addition, the effective tax rate can be impacted each period by discrete income tax factors and events. During the three months ended July 2, 2016, special charges, acquisition-related costs and discrete income tax items favorably impacted the effective income tax rate by 1.5 percentage points. During the six months ended July 2, 2016, special charges, acquisition-related costs, other-than-temporary impairments and discrete income tax items unfavorably impacted the effective income tax rate by 5.1 percentage points. Special charges, acquisition-related costs and discrete income tax items recognized during the second quarter and first six months of 2015 favorably impacted the effective rate by 13.2 percentage points and 6.5 percentage points, respectively.

During the first quarter of 2016, the European Commission concluded that decisions by the tax authorities in Belgium regarding corporate income taxes paid under certain excess profit rulings, including the ruling previously granted to one of the Company’s subsidiaries, did not comply with European Union rules on state aid. Based on the applicability of this conclusion to the Company's 2009 through 2014 tax returns in Belgium, the Company recorded a liability of 46 million Euros including interest during the first quarter of 2016 to reserve for this uncertain tax position. During the second quarter of 2016, the Company revised the estimated liability to 43 million Euros ($48 million as of July 2, 2016) including interest.

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Fair Value Measurements

6 Months Ended

Jul. 02, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

The fair value measurement standard applies to certain financial assets and liabilities that are measured at fair value on a recurring basis (each reporting period) and certain financial assets and liabilities that are measured at fair value on a nonrecurring basis. The Company also maintains other financial instruments that approximate their fair value due to their short maturities, and include such instruments as its cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and current and long-term debt obligations.

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

The Company's financial assets and liabilities that are measured at fair value on a recurring basis include money-market securities, available-for-sale marketable securities, trading marketable securities, derivative instruments and contingent consideration liabilities. The Company does not have any material nonfinancial assets or liabilities that are measured at fair value on a recurring basis. A summary of the valuation methodologies used for the respective financial assets and liabilities measured at fair value on a recurring basis is as follows:

Money-market securities: The Company’s money-market securities include funds that are traded in active markets and are recorded at fair value based upon the quoted market prices. The Company classifies these securities as level 1.

Available-for-sale securities: The Company’s available-for-sale securities include publicly-traded equity securities that are traded in active markets and are recorded at fair value based upon the closing stock prices. The Company classifies these securities as level 1.

The following table summarizes the components of the balance of the Company’s available-for-sale securities at July 2, 2016 and January 2, 2016 (in millions):

	July 2, 2016		January 2, 2016
Adjusted cost	$	5	$	5
Gross unrealized gains	6		6
Gross unrealized losses	—		(1		)
Fair value	$	11	$	10

Trading securities: The Company’s trading securities include publicly-traded mutual funds that are traded in active markets and are recorded at fair value based upon quoted market prices of the net asset values of the funds. The Company classifies these securities as level 1.

Derivative instruments: Fair values for the Company’s derivative financial instruments are based on quoted market prices of comparable instruments, if available, or more commonly on standard pricing models that use readily observable market parameters from industry standard data providers as their basis. These models reflect contractual terms of the derivatives, including period to maturity and market-based parameters such as foreign currency exchange rates. They do not contain a high level of subjectivity as the techniques used in the models do not require significant judgment and inputs are readily observable from actively quoted markets. The Company classifies these instruments as level 2 (see Note 9).

Contingent consideration liabilities: The fair value of the Company's contingent liabilities is initially measured based on the consideration expected to be transferred (probability-weighted), discounted back to present value. The discount rate used is determined at the time of measurement in accordance with accepted valuation methods. The Company measures the liability on a recurring basis using Level 3 inputs including regulatory approval timing, projected revenues or cash flows, growth rates, discount rates, probabilities of payment and projected payment dates. Projected revenues are based on the Company's most recent internal operating budgets and long-term strategic plans. Changes to any of the inputs may result in significantly higher or lower fair value measurements.

A summary of assets and liabilities measured at fair value on a recurring basis at July 2, 2016 and January 2, 2016 is as follows (in millions):

	Balance Sheet Classification	July 2, 2016		Quoted Prices In Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money-market securities	Cash and cash equivalents	$	52	$	52	$	—	$	—
Available-for-sale      securities	Other current assets	11		11		—		—
Foreign currency forward contracts	Other current assets	4		—		4		—
Trading securities	Other assets	312		312		—		—
Foreign currency forward      contracts	Other assets	1		—		1		—
Total assets		$	380	$	375	$	5	$	—
Liabilities
Foreign currency forward contracts	Other current liabilities	$	34	$	—	$	34	$	—
Contingent consideration	Other liabilities	31		—		—		31
Foreign currency forward contracts	Other liabilities	5		—		5		—
Total liabilities		$	70	$	—	$	39	$	31

	Balance Sheet Classification	January 2, 2016		Quoted Prices In Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money-market securities	Cash and cash equivalents	$	273	$	273	$	—	$	—
Available-for-sale    securities	Other current assets	10		10		—		—
Foreign currency forward contracts	Other current assets	14		—		14		—
Trading securities	Other assets	302		302		—		—
Foreign currency forward contracts	Other assets	2		—		2		—
Total assets		$	601	$	585	$	16	$	—
Liabilities
Contingent consideration	Other current liabilities	$	118	$	—	$	—	$	118
Foreign currency forward contracts	Other current liabilities	6		—		6		—
Contingent consideration	Other liabilities	33		—		—		33
Foreign currency forward contracts	Other liabilities	3		—		3		—
Total liabilities		$	160	$	—	$	9	$	151

The recurring Level 3 fair value measurements of the Company's contingent consideration liabilities include the following significant unobservable inputs (in millions):

Contingent Consideration Liabilities	Fair Value as of July 2, 2016		Valuation Technique	Unobservable Input	Value or Range
Spinal Modulation revenue-based milestones and earn-outs	$	2	Monte Carlo Simulation	Discount Rates	0.6%	-	15.5%
				Expected Revenue Volatility			25.0%
				Projected Years of Payments	2017, 2018
Nanostim, Inc. (Nanostim) revenue-based milestones	2		Probability Weighted Discounted Cash Flow	Discount Rate			5.0%
				Probability of Payments			10.0%
				Projected Years of Payments	2017, 2018
Assumed from Thoratec regulatory-based and revenue-based milestones	27		Probability Weighted Discounted Cash Flow	Discount Rate			4.4%
				Probabilities of Payments	—%	-	90.0%
				Projected Years of Payments	2018	-	2022
Total contingent consideration liabilities	$	31

Additionally, the following table provides a reconciliation of the beginning and ending balances of the Company's recurring Level 3 fair value measurements (in millions):

	Nanostim			Spinal Modulation			Assumed from Thoratec			Total
Balance as of January 3, 2015	$	50		$	—		$	—		$	50
Initial fair value measurement of contingent consideration	—			155			—			155
Liabilities assumed from Thoratec acquisition	—			—			33			33
Change in fair value of contingent consideration	(48		)	(33		)	(6		)	(87		)
Balance as of January 2, 2016	2			122			27			151
Change in fair value of contingent consideration	—			8			1			9
Transfer out of Level 3 fair value measurement due to contractual settlement	—			(124		)	—			(124		)
Balance as of April 2, 2016	2			6			28			36
Change in fair value of contingent consideration	—			(4		)	(1		)	(5		)
Balance as of July 2, 2016	$	2		$	2		$	27		$	31

Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis

Disclosures are required for certain assets and liabilities that are measured at fair value but are recognized and disclosed at fair value on a nonrecurring basis in periods subsequent to initial recognition. For St. Jude Medical, such measurements of fair value primarily relate to long-lived assets, goodwill, indefinite-lived intangible assets and cost method investments.

Other than the items discussed below, there were no other material impairments that were measured at fair value on a nonrecurring basis for the three and six months ended July 2, 2016 or July 4, 2015.

Long-lived assets: During the first quarter of 2016, the Company recognized $5 million of fixed asset write-offs primarily associated with projects abandoned as the Company continues to integrate its recent acquisitions. Additionally, during the first quarter of 2015, the Company recognized $1 million of fixed asset write-offs primarily related to projects abandoned under the realigned structure. Typically the Company measures these assets using independent appraisals, market models and discounted cash flow models. However, as these fixed assets had no alternative future use and therefore no discrete future cash flows, the assets were fully impaired.

Cost method investments: The Company also holds investments in equity securities that are accounted for as cost method investments, which are classified as other assets and measured at fair value on a nonrecurring basis. The carrying value of these investments was $59 million and $80 million as of July 2, 2016 and January 2, 2016, respectively. During the first quarter of 2016, the Company concluded that adverse regulatory rulings and subsequent operational decisions made by an entity in which the Company had strategic debt and equity investments had an adverse impact on the fair values of those investments. As a result, the Company recognized other-than-temporary impairments of approximately $50 million in other (income) expense in the Condensed Consolidated Statements of Earnings to fully write-down its cost method equity investment and convertible debt investment. The fair value of the Company’s remaining cost method investments was not estimated during the three and six months ended July 2, 2016 since there were no other identified events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments.

Fair Value Measurements of Other Financial Instruments

The aggregate fair value of the Company’s fixed-rate senior notes at July 2, 2016 (measured using quoted prices in active markets) was $3,470 million compared to the aggregate carrying value of $3,272 million (inclusive of unamortized debt discounts). The fair value of the Company’s variable-rate debt obligations at July 2, 2016 approximated its aggregate $2,819 million carrying value due to the variable interest rate and short-term nature of these instruments. The Company also had $346 million and $393 million of cash equivalents invested in short-term deposits and interest and non-interest bearing bank accounts at July 2, 2016 and January 2, 2016, respectively, the cost basis of which approximated the fair value.

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Derivative Financial Instruments

6 Months Ended

Jul. 02, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses foreign currency forward contracts, interest rate swaps and interest rate contracts to manage risks generally associated with foreign exchange rate and interest rate fluctuations. The information that follows explains the various types of derivatives financial instruments and how they impacted the Company's financial position and performance.

Cash Flow Hedges

Foreign exchange forward contracts: During 2015, the Company began to enter into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies. These transactions are designated as cash flow hedges. The Company hedges its exposure to the variability in future cash flows of forecasted transactions for periods of up to 24 months. The dollar equivalent gross notional amount of the Company’s foreign exchange forward contracts designated as cash flow hedges at July 2, 2016 was approximately $1.0 billion. Hedge ineffectiveness recognized in earnings on cash flow hedges during the three and six months ended July 2, 2016 and July 4, 2015 was not material.

As of July 2, 2016, the Company had a balance of $27 million associated with the after-tax net unrealized loss position related to foreign currency forward contracts recorded in accumulated other comprehensive income. Based on exchange rates as of July 2, 2016, the Company expects to reclassify net losses of approximately $19 million after-tax to earnings over the next 12 months contemporaneously with the earnings effects of the related forecasted transactions (with the impact offset by cash flows from the underlying hedged items).

The following table provides the (gains) losses related to derivative instruments designated as cash flow hedges for the three and six months ended July 2, 2016 and July 4, 2015, including the location in the Condensed Consolidated Statements of Earnings and the Condensed Consolidated Statements of Comprehensive Income (in millions):

			Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss		in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other		of Derivative as a Result of				and Amount Excluded from
Three	Comprehensive		Reclassification from				Effectiveness Testing
months	Income on Effective		Accumulated Other				Recognized
ended	Portion of Derivative		Comprehensive Income				in Earnings
July 2, 2016	Amount		Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	5	$	—		Cost of sales	$	—	Cost of sales
			Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss		in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other		of Derivative as a Result of				and Amount Excluded from
Six	Comprehensive		Reclassification from				Effectiveness Testing
months	Income on Effective		Accumulated Other				Recognized
ended	Portion of Derivative		Comprehensive Income				in Earnings
July 2, 2016	Amount		Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	44	$	(6	)	Cost of sales	$	—	Cost of sales

				Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss			in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other			of Derivative as a Result of				and Amount Excluded from
Three	Comprehensive			Reclassification from				Effectiveness Testing
months	Income on Effective			Accumulated Other				Recognized
ended	Portion of Derivative			Comprehensive Income				in Earnings
July 4, 2015	Amount			Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	15		$	(4	)	Cost of sales	$	—	Cost of sales
				Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss			in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other			of Derivative as a Result of				and Amount Excluded from
Six	Comprehensive			Reclassification from				Effectiveness Testing
months	Income on Effective			Accumulated Other				Recognized
ended	Portion of Derivative			Comprehensive Income				in Earnings
July 4, 2015	Amount			Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	(19	)	$	(4	)	Cost of sales	$	—	Cost of sales

Reclassifications from accumulated other comprehensive income into earnings include accumulated (gains) losses on dedesignated hedges at the time earnings are impacted.

Derivatives Not Designated as Hedging Instruments

Derivatives not designated as hedging instruments include dedesignated foreign currency forward contracts and foreign currency forward contracts that the Company utilizes to economically hedge the foreign currency impact of assets and liabilities denominated in nonfunctional currencies. The dollar equivalent gross notional amount of these forward contracts not designated as hedging instruments totaled approximately $0.2 billion as of July 2, 2016. The fair value of the Company's outstanding contracts was not material as of July 2, 2016 and January 2, 2016.

The following table provides the (gains) losses related to derivative instruments not designated as hedging instruments, including the location in the Condensed Consolidated Statements of Earnings (in millions):

Derivatives Not	(Gain) Loss on Derivatives					(Gain) Loss on Derivatives
Designated as	Recognized in Earnings					Recognized in Earnings
Hedging	Three Months Ended					Six Months Ended
Instruments	July 2, 2016			July 4, 2015		July 2, 2016		July 4, 2015			Location
Foreign currency forward contracts	$	(2	)	$	1	$	1	$	(8	)	Other (income) expense

The net (gains) losses werealmost entirely offset by corresponding net (losses) gains on the foreign currency exposures being managed.

Location and Fair Value Amount of Derivative Instruments

The following table summarizes the fair value of the Company’s derivative instruments and their locations in the Condensed Consolidated Balance Sheets as of July 2, 2016 and January 2, 2016 (in millions):

Fair Value of Derivative Instruments	July 2, 2016			January 2, 2016			Location
Derivatives Designated as Hedging Instruments
Foreign currency forward contracts	$	4		$	14		Other current assets
	1			2			Other assets
	(34		)	(6		)	Other current liabilities
	(5		)	(3		)	Other liabilities
Derivatives Not Designated as Hedging Instruments
Foreign currency forward contracts	—			—			Other current assets
	—			—			Other current liabilities
Total	$	(34	)	$	7

Additional information with respect to the fair values of the Company's derivative instruments is included in Note 8.

Credit Risk and Offsetting of Assets and Liabilities of Derivative Instruments

As of July 2, 2016, St. Jude Medical, Inc. had International Swaps and Derivatives Association agreements with four applicable banks and financial institutions that contain netting provisions.

The following tables provide information as though the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria in the event of default or termination as stipulated by the terms of the netting arrangements with each of the counterparties as of July 2, 2016 and January 2, 2016, respectively (in millions):

			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
			Eligible Offsetting
	Gross Amount of		Recognized
	Derivative Assets		Derivative Liabilities
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of July 2, 2016	Balance Sheet		Balance Sheet		Received		Assets
Derivatives subject to master netting agreements	$	3	$	2	$	—	$	1
Derivatives not subject to master netting agreements	2						2
Total	$	5	$	2	$	—	$	3
			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
	Gross Amount of		Eligible Offsetting
	Derivative		Recognized
	Liabilities		Derivative Assets
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of July 2, 2016	Balance Sheet		Balance Sheet		Pledged		Liabilities
Derivatives subject to master netting agreements	$	22	$	2	$	—	$	20
Derivatives not subject to master netting agreements	17						17
Total	$	39	$	2	$	—	$	37

			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
			Eligible Offsetting
	Gross Amount of		Recognized
	Derivative Assets		Derivative Liabilities
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of January 2, 2016	Balance Sheet		Balance Sheet		Received		Assets
Derivatives subject to master netting agreements	$	3	$	1	$	—	$	2
Derivatives not subject to master netting agreements	13						13
Total	$	16	$	1	$	—	$	15
			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
	Gross Amount of		Eligible Offsetting
	Derivative		Recognized
	Liabilities		Derivative Assets
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of January 2, 2016	Balance Sheet		Balance Sheet		Pledged		Liabilities
Derivatives subject to master netting agreements	$	1	$	1	$	—	$	—
Derivatives not subject to master netting agreements	8						8
Total	$	9	1		$	—	$	8

For each counterparty, if netted, the Company would offset the asset and liability balances of all derivatives at the end of the reporting period. Derivatives not subject to master netting agreements are not eligible for net presentation. As of both July 2, 2016 and January 2, 2016, no cash collateral had been received or pledged related to these derivative instruments.

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Business Combinations

6 Months Ended

Jul. 02, 2016

Business Combinations [Abstract]

Business Combination

BUSINESS COMBINATIONS

Fiscal Year 2016

Middle East distributor: In February 2016, the Company acquired certain assets and assumed certain liabilities of a medical device distributor in the Middle East for $19 million of total purchase consideration. The transaction was accounted for as a purchase business combination. The purchase price allocation, which includes customer relationship intangible assets of $7 million and goodwill of $5 million, is considered preliminary, largely with respect to certain tax-related assets and liabilities. During the second quarter of 2016, the Company did not recognize material adjustments to provisional amounts.

Fiscal Year 2015

Thoratec: The Company continues to evaluate information about facts and circumstances that existed as of the date Thoratec was acquired. As such, the purchase price allocation is considered preliminary, largely with respect to certain tax-related assets and liabilities and legal contingencies. During the first six months of 2016, the Company did not recognize material adjustments to provisional amounts.

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Abbott Transaction

6 Months Ended

Jul. 02, 2016

Subsequent Events [Abstract]

Abbott Transaction

ABBOTT TRANSACTION

On April 27, 2016, the Company and Abbott entered into an agreement and plan of merger (the “Merger Agreement”). Under the Merger Agreement generally each outstanding share of the Company’s common stock will be converted into the right to receive (x) $46.75 in cash, without interest thereon, and (y) 0.8708 of a validly issued, fully paid and non-assessable common share of Abbott (such ratio as may be adjusted pursuant to the Merger Agreement), less any applicable withholding taxes.

Completion of the merger is subject to customary closing conditions, including (i) adoption of the Merger Agreement by the affirmative vote of the holders of a majority of all outstanding Company common shares, (ii) effectiveness of the Registration Statement on Form S-4 to be filed with the Securities and Exchange Commission by Abbott in connection with the registration of the Abbott common shares to be issued in the merger, (iii) the expiration of the waiting period applicable under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (HSR Act), and receipt of other specified antitrust approvals, (iv) subject to specified materiality thresholds, the accuracy of the representations and warranties of the other party, (v) the other party having performed in all material respects all of its obligations under the Merger Agreement, (vi) the absence of a material adverse effect, as defined in the Merger Agreement, on the other party, and (vii) the receipt by each party of opinions to the effect that the transaction will be treated as a reorganization for U.S. federal income tax purposes.

On July 11, 2016, the Company and Abbott each received a request for additional information (the Second Request) from the United States Federal Trade Commission (FTC) pursuant to the HSR Act, in connection with Abbott’s pending acquisition of the Company. The effect of the Second Request is to extend the waiting period imposed by the HSR Act until 30 days after Abbott and the Company have substantially complied with the request, unless that period is extended voluntarily by the parties or terminated sooner by the FTC.

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Basis Of Presentation (Policies)

6 Months Ended

Jul. 02, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

New Accounting Pronouncements, Policy

New Accounting Pronouncements: The following table provides a description of recent accounting pronouncements adopted and those standards not yet adopted with potential for a material impact on the Company's financial statements or disclosures.

Standard	Description	Required adoption timing and approach	Impact of adoption or other significant matters
Standards recently adopted
Accounting Standards Update (ASU) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis	The standard affects both the variable interest entity and voting interest entity consolidation models.	Annual and interim periods beginning after December 15, 2015, with either retrospective or modified retrospective application permitted. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the modified retrospective method. The adoption did not have a material impact on the Company's results of operations or financial position.

ASU No. 2015-05, Intangibles--Goodwill and Other--Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement	The standard provides guidance to customers about how to account for cloud computing arrangements when such arrangements include software licenses.	Annual and interim periods beginning after December 15, 2015, with either prospective or retrospective application permitted. Early adoption was permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the prospective method. The adoption did not have a material impact on the Company's results of operations or financial position.
ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory	The standard requires that inventory within the scope of the guidance be measured at the lower of cost or net realizable value.	Annual and interim periods beginning after December 15, 2016, with prospective application required. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016. The adoption did not have a material impact on the Company's results of operations or financial position.
Standards not yet adopted
ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606)	The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance will supersede the current revenue recognition requirements.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.
ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date	The standard defers the effective date of ASU No. 2014-09 to annual and interim periods beginning after December 15, 2017. Early adoption is permitted only as of annual and interim reporting periods beginning after December 15, 2016.	Not applicable.	Not applicable.
ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	Among other things, the standard requires certain equity investments to be measured at fair value with changes in fair value recognized in net income, simplifies the impairment assessment of equity investments without readily determinable fair values, and eliminates certain disclosure requirements.	Annual and interim periods beginning after December 15, 2017. Early adoption of certain guidance is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.
ASU No. 2016-02, Leases (Topic 842)	Among other things, the standard requires recognition of a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position for virtually all leases where we are the lessee.	Annual and interim periods beginning after December 15, 2018, with modified retrospective application required. Early adoption is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.

ASU No. 2016-09, Compensation--Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	The areas for simplification in this standard involve several aspects of the accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.	Annual and interim periods beginning after December 15, 2016, with certain aspects requiring modified retrospective transition, retrospective application, and/or prospective application. Early adoption is permitted if all aspects are adopted simultaneously.	The Company is evaluating the timing of adoption and the potential impact to its results of operations, financial position and cash flows.
ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing	Among other things, the standard clarifies the principle for determining whether a good or service is “separately identifiable” from other promises in the contract and, therefore, should be accounted for separately. It also clarifies that entities are not required to identify promised goods or services that are immaterial in the context of the contract.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.

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Basis Of Presentation (Tables)

6 Months Ended

Jul. 02, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of New Accounting Pronouncements

New Accounting Pronouncements: The following table provides a description of recent accounting pronouncements adopted and those standards not yet adopted with potential for a material impact on the Company's financial statements or disclosures.

Standard	Description	Required adoption timing and approach	Impact of adoption or other significant matters
Standards recently adopted
Accounting Standards Update (ASU) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis	The standard affects both the variable interest entity and voting interest entity consolidation models.	Annual and interim periods beginning after December 15, 2015, with either retrospective or modified retrospective application permitted. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the modified retrospective method. The adoption did not have a material impact on the Company's results of operations or financial position.

ASU No. 2015-05, Intangibles--Goodwill and Other--Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement	The standard provides guidance to customers about how to account for cloud computing arrangements when such arrangements include software licenses.	Annual and interim periods beginning after December 15, 2015, with either prospective or retrospective application permitted. Early adoption was permitted.	The Company adopted this ASU in the quarter ended April 2, 2016, using the prospective method. The adoption did not have a material impact on the Company's results of operations or financial position.
ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory	The standard requires that inventory within the scope of the guidance be measured at the lower of cost or net realizable value.	Annual and interim periods beginning after December 15, 2016, with prospective application required. Early adoption is permitted.	The Company adopted this ASU in the quarter ended April 2, 2016. The adoption did not have a material impact on the Company's results of operations or financial position.
Standards not yet adopted
ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606)	The standard requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance will supersede the current revenue recognition requirements.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.
ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date	The standard defers the effective date of ASU No. 2014-09 to annual and interim periods beginning after December 15, 2017. Early adoption is permitted only as of annual and interim reporting periods beginning after December 15, 2016.	Not applicable.	Not applicable.
ASU No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	Among other things, the standard requires certain equity investments to be measured at fair value with changes in fair value recognized in net income, simplifies the impairment assessment of equity investments without readily determinable fair values, and eliminates certain disclosure requirements.	Annual and interim periods beginning after December 15, 2017. Early adoption of certain guidance is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.
ASU No. 2016-02, Leases (Topic 842)	Among other things, the standard requires recognition of a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement of financial position for virtually all leases where we are the lessee.	Annual and interim periods beginning after December 15, 2018, with modified retrospective application required. Early adoption is permitted.	The Company is evaluating the timing of adoption and the potential impact to its results of operations and financial position.

ASU No. 2016-09, Compensation--Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	The areas for simplification in this standard involve several aspects of the accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows.	Annual and interim periods beginning after December 15, 2016, with certain aspects requiring modified retrospective transition, retrospective application, and/or prospective application. Early adoption is permitted if all aspects are adopted simultaneously.	The Company is evaluating the timing of adoption and the potential impact to its results of operations, financial position and cash flows.
ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing	Among other things, the standard clarifies the principle for determining whether a good or service is “separately identifiable” from other promises in the contract and, therefore, should be accounted for separately. It also clarifies that entities are not required to identify promised goods or services that are immaterial in the context of the contract.	Refer to ASU No. 2015-14 regarding the adoption timing. Either retrospective or modified retrospective application is permitted.	The Company plans to adopt this ASU for interim and annual periods beginning after December 15, 2017. The Company is evaluating its approach to the adoption and the potential impact to its results of operations and financial position.

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Debt (Tables)

6 Months Ended

Jul. 02, 2016

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

The carrying value of the Company’s debt, including debt issuance costs, discounts or premiums consisted of the following (in millions):

	July 2, 2016		January 2, 2016
Term Loan Due 2020	$	2,368	$	2,093
2016 Senior Notes	—		500
2018 Senior Notes	497		496
2020 Senior Notes	496		496
2023 Senior Notes	892		892
2025 Senior Notes	494		494
2043 Senior Notes	690		689
Yen-denominated Senior Notes Due 2017	79		68
Yen-denominated Senior Notes Due 2020	124		106
Yen-denominated credit facilities	64		54
Commercial paper borrowings	387		504
Total debt	6,091		6,392
Less: current debt obligations	660		1,163
Long-term debt	$	5,431	$	5,229

Schedule of Maturities of Long-term Debt

Contractual maturities of the Company's debt for the next five fiscal years and thereafter, excluding any debt issuance costs, discounts or premiums, as of July 2, 2016 were as follows (in millions):

	Remainder of 2016		2017		2018		2019		2020		After 2020
Future minimum principal payments	$	453	$	272	$	598	$	227	$	2,478	$	2,100

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Commitments And Contingencies (Tables)

6 Months Ended

Jul. 02, 2016

Commitments and Contingencies Disclosure [Abstract]

Schedule Of Product Warranty Liability

Changes in the Company’s product warranty liability during the three and six months ended July 2, 2016 and July 4, 2015 were as follows (in millions):

	Three Months Ended						Six Months Ended
	July 2, 2016			July 4, 2015			July 2, 2016			July 4, 2015
Balance at beginning of period	$	26		$	32		$	31		$	35
Warranty expense (benefit) recognized	2			(2		)	1			(4		)
Warranty credits issued	(3		)	(1		)	(7		)	(2		)
Balance at end of period	$	25		$	29		$	25		$	29

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Special Charges (Tables)

6 Months Ended

Jul. 02, 2016

2016 Initiatives

Restructuring Cost and Reserve

Summary Of Activity Related To Special Charge Restructuring Accrual

A summary of the activity related to the 2016 Initiatives accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	—		$	—		$	—		$	—		$	—
Cost of sales special charges	9			1			1			1			12
Special charges	22			—			—			—			22
Non-cash charges used	—			(1		)	(1		)	—			(2		)
Cash payments	(2		)	—			—			(1		)	(3		)
Balance at January 2, 2016	29			—			—			—			29
Cost of sales special charges	—			2			1			1			4
Special charges	11			—			4			5			20
Non-cash charges used	—			(2		)	(5		)	—			(7		)
Cash payments	(32		)	—			—			(5		)	(37		)
Balance at April 2, 2016	8			—			—			1			9
Cost of sales special charges	—			—			—			2			2
Special charges	6			—			—			4			10
Cash payments	(6		)	—			—			(4		)	(10		)
Balance at July 2, 2016	$	8		$	—		$	—		$	3		$	11

Manufacturing and Supply Chain Optimization Plan

Restructuring Cost and Reserve

Summary Of Activity Related To Special Charge Restructuring Accrual

A summary of the activity related to the Manufacturing and Supply Chain Optimization Plan accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	14		$	—		$	—		$	6		$	20
Cost of sales special charges	4			3			15			7			29
Special charges	20			—			—			29			49
Non-cash charges used	—			(3		)	(15		)	—			(18		)
Cash payments	(27		)	—			—			(35		)	(62		)
Balance at January 2, 2016	11			—			—			6			17
Cost of sales special charges	—			—			—			1			1
Cash payments	(3		)	—			—			(6		)	(9		)
Balance at April 2, 2016	8			—			—			1			9
Cost of sales special charges	—			—			—			1			1
Special charges	—			—			—			1			1
Cash payments	(3		)	—			—			(2		)	(5		)
Balance at July 2, 2016	$	5		$	—		$	—		$	1		$	6

2012 Business Realignment Restructuring Plan

Restructuring Cost and Reserve

Summary Of Activity Related To Special Charge Restructuring Accrual

A summary of the activity related to the 2012 Business Realignment Plan accrual is as follows (in millions):

	Employee Termination Costs			Inventory Charges			Fixed Asset Charges			Other Restructuring Costs			Total
Balance at January 3, 2015	$	26		$	—		$	—		$	12		$	38
Cost of sales special charges	2			3			—			—			5
Special charges	2			—			2			5			9
Non-cash charges used	—			(3		)	(2		)	—			(5		)
Cash payments	(25		)	—			—			(10		)	(35		)
Foreign exchange rate impact	(2		)	—			—			—			(2		)
Balance at January 2, 2016	3			—			—			7			10
Cost of sales special charges	—			(1		)	—			(1		)	(2		)
Non-cash charges used	—			1			—			—			1
Balance at April 2, 2016	3			—			—			6			9
Cash payments	(1		)	—			—			—			(1		)
Balance at July 2, 2016	$	2		$	—		$	—		$	6		$	8

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Net Earnings Per Share (Tables)

6 Months Ended

Jul. 02, 2016

Earnings Per Share [Abstract]

Schedule Of Computation Of Basic And Diluted Net Earnings Per Share

The table below sets forth the computation of basic and diluted net earnings per share attributable to St. Jude Medical, Inc. (in millions, except per share amounts):

	Three Months Ended				Six Months Ended
	July 2, 2016		July 4, 2015		July 2, 2016		July 4, 2015
Numerator:
Net earnings attributable to St. Jude Medical, Inc.	$	238	$	290	$	333	$	552
Denominator:
Basic weighted average shares outstanding	284.3		281.1		283.9		282.0
Dilution associated with stock-based compensation plans	4.0		4.4		3.4		4.3
Diluted weighted average shares outstanding	288.3		285.5		287.3		286.3
Basic net earnings per share attributable to St. Jude Medical, Inc.	$	0.84	$	1.03	$	1.17	$	1.96
Diluted net earnings per share attributable to St. Jude Medical, Inc.	$	0.83	$	1.02	$	1.16	$	1.93
Anti-dilutive shares of common stock excluded from diluted net earnings per share attributable to St. Jude Medical, Inc.	3.8		2.6		6.1		3.4

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Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information (Tables)

6 Months Ended

Jul. 02, 2016

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The tables below present the changes in each component of accumulated other comprehensive income, net of tax, including other comprehensive income and reclassifications out of accumulated other comprehensive income into net earnings for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the three months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 2, 2016	$	3	$	(19	)	$	(311	)	$	(327	)
Other comprehensive income (loss) before reclassifications	1		(4		)	(17		)	(20		)
Amounts reclassified to net earnings from accumulated other comprehensive income	—		—			—			—
Other comprehensive income (loss)	1		(4		)	(17		)	(20		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

The tables below present the changes in each component of accumulated other comprehensive income, net of tax, including other comprehensive income and reclassifications out of accumulated other comprehensive income into net earnings for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the three months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 2, 2016	$	3	$	(19	)	$	(311	)	$	(327	)
Other comprehensive income (loss) before reclassifications	1		(4		)	(17		)	(20		)
Amounts reclassified to net earnings from accumulated other comprehensive income	—		—			—			—
Other comprehensive income (loss)	1		(4		)	(17		)	(20		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

	Unrealized
	Gain (Loss) On		Unrealized			Foreign			Accumulated
	Available-for-		Gain (Loss) On			Currency			Other
For the six months ended July 2, 2016	sale Securities		Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of January 2, 2016	$	3	$	11		$	(359	)	$	(345	)
Other comprehensive income (loss) before reclassifications	1		(30		)	31			2
Amounts reclassified to net earnings from accumulated other comprehensive income	—		(4		)	—			(4		)
Other comprehensive income (loss)	1		(34		)	31			(2		)
Accumulated other comprehensive income (loss) as of July 2, 2016	$	4	$	(23	)	$	(328	)	$	(347	)

	Unrealized
	Gain (Loss) On			Unrealized			Foreign			Accumulated
	Available-for-			Gain (Loss) On			Currency			Other
For the three months ended July 4, 2015	sale Securities			Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of April 4, 2015	$	16		$	32		$	(318	)	$	(270	)
Other comprehensive income (loss) before reclassifications	(2		)	(13		)	30			15
Amounts reclassified to net earnings from accumulated other comprehensive income	(2		)	(4		)	—			(6		)
Other comprehensive income (loss)	(4		)	(17		)	30			9
Accumulated other comprehensive income (loss) as of July 4, 2015	$	12		$	15		$	(288	)	$	(261	)
	Unrealized
	Gain (Loss) On			Unrealized			Foreign			Accumulated
	Available-for-			Gain (Loss) On			Currency			Other
For the six months ended July 4, 2015	sale Securities			Derivative Instruments			translation adjustment			Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) as of January 3, 2015	$	15		$	3		$	(191	)	$	(173	)
Other comprehensive income (loss) before reclassifications	1			16			(97		)	(80		)
Amounts reclassified to net earnings from accumulated other comprehensive income	(4		)	(4		)	—			(8		)
Other comprehensive income (loss)	(3		)	12			(97		)	(88		)
Accumulated other comprehensive income (loss) as of July 4, 2015	$	12		$	15		$	(288	)	$	(261	)

Reclassification out of Accumulated Other Comprehensive Income

The following table provides details about reclassifications out of accumulated other comprehensive income and the line items impacted in the Company's Condensed Consolidated Statements of Earnings during the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

Details about	Amount reclassified from accumulated other comprehensive income
accumulated other	Three Months Ended					Six Months Ended
comprehensive income components	July 2, 2016		July 4, 2015			July 2, 2016			July 4, 2015			Statements of Earnings Classification
Unrealized (gain) loss on available-for-sale securities:
(Gain) loss on sale of available-for-sale securities	$	—	$	(3	)	$	—		$	(7	)	Other (income) expense
Tax effect	—		1			—			3			Income tax expense
Net of tax	$	—	$	(2	)	$	—		$	(4	)
Unrealized (gain) loss on derivative financial instruments:
(Gain) loss recognized on derivative financial instruments	$	—	$	(4	)	$	(6	)	$	(4	)	Cost of sales
Tax effect	—		—			2			—			Income tax expense
Net of tax	$	—	$	(4	)	$	(4	)	$	(4	)

Schedule of Noncontrolling Interest

The supplemental equity schedules below present changes in the Company's noncontrolling interest and total shareholders' equity for the three and six months ended July 2, 2016 and July 4, 2015, respectively (in millions):

	Total
	Shareholders'
	Equity
	Before					Total
	Noncontrolling			Noncontrolling		Shareholders'
For the six months ended July 2, 2016	Interest			Interest		Equity
Balance at January 2, 2016	$	4,042		$	—	$	4,042
Net earnings	333			—		333
Other comprehensive income (loss)	(2		)	—		(2		)
Cash dividends declared	(176		)	—		(176		)
Stock-based compensation	60			—		60
Common stock issued under employee stock plans and other, net	22			—		22
Tax benefit from stock plans	2			—		2
Balance at July 2, 2016	$	4,281		$	—	$	4,281

	Total
	Shareholders'
	Equity
	Before						Total
	Noncontrolling			Noncontrolling			Shareholders'
For the six months ended July 4, 2015	Interest			Interest			Equity
Balance at January 3, 2015	$	4,199		$	45		$	4,244
Net earnings	552			(14		)	538
Other comprehensive income (loss)	(88		)	—			(88		)
Cash dividends declared	(163		)	—			(163		)
Repurchases of common stock	(500		)	—			(500		)
Stock-based compensation	35			2			37
Common stock issued under employee stock plans and other, net	89			—			89
Tax benefit from stock plans	14			—			14
Additions (purchases) of noncontrolling ownership interests	(297		)	(33		)	(330		)
Balance at July 4, 2015	$	3,841		$	—		$	3,841

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Fair Value Measurements (Tables)

6 Months Ended

Jul. 02, 2016

Fair Value Disclosures [Abstract]

Summary Of Components Of Available-For-Sale Securities

The following table summarizes the components of the balance of the Company’s available-for-sale securities at July 2, 2016 and January 2, 2016 (in millions):

	July 2, 2016		January 2, 2016
Adjusted cost	$	5	$	5
Gross unrealized gains	6		6
Gross unrealized losses	—		(1		)
Fair value	$	11	$	10

Summary Of Financial Assets and Liabilities Measured At Fair Value On A Recurring Basis

A summary of assets and liabilities measured at fair value on a recurring basis at July 2, 2016 and January 2, 2016 is as follows (in millions):

	Balance Sheet Classification	July 2, 2016		Quoted Prices In Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money-market securities	Cash and cash equivalents	$	52	$	52	$	—	$	—
Available-for-sale      securities	Other current assets	11		11		—		—
Foreign currency forward contracts	Other current assets	4		—		4		—
Trading securities	Other assets	312		312		—		—
Foreign currency forward      contracts	Other assets	1		—		1		—
Total assets		$	380	$	375	$	5	$	—
Liabilities
Foreign currency forward contracts	Other current liabilities	$	34	$	—	$	34	$	—
Contingent consideration	Other liabilities	31		—		—		31
Foreign currency forward contracts	Other liabilities	5		—		5		—
Total liabilities		$	70	$	—	$	39	$	31

	Balance Sheet Classification	January 2, 2016		Quoted Prices In Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money-market securities	Cash and cash equivalents	$	273	$	273	$	—	$	—
Available-for-sale    securities	Other current assets	10		10		—		—
Foreign currency forward contracts	Other current assets	14		—		14		—
Trading securities	Other assets	302		302		—		—
Foreign currency forward contracts	Other assets	2		—		2		—
Total assets		$	601	$	585	$	16	$	—
Liabilities
Contingent consideration	Other current liabilities	$	118	$	—	$	—	$	118
Foreign currency forward contracts	Other current liabilities	6		—		6		—
Contingent consideration	Other liabilities	33		—		—		33
Foreign currency forward contracts	Other liabilities	3		—		3		—
Total liabilities		$	160	$	—	$	9	$	151

Summary of Level 3 Fair Value Measurements of Contingent Consideration Liability

The recurring Level 3 fair value measurements of the Company's contingent consideration liabilities include the following significant unobservable inputs (in millions):

Contingent Consideration Liabilities	Fair Value as of July 2, 2016		Valuation Technique	Unobservable Input	Value or Range
Spinal Modulation revenue-based milestones and earn-outs	$	2	Monte Carlo Simulation	Discount Rates	0.6%	-	15.5%
				Expected Revenue Volatility			25.0%
				Projected Years of Payments	2017, 2018
Nanostim, Inc. (Nanostim) revenue-based milestones	2		Probability Weighted Discounted Cash Flow	Discount Rate			5.0%
				Probability of Payments			10.0%
				Projected Years of Payments	2017, 2018
Assumed from Thoratec regulatory-based and revenue-based milestones	27		Probability Weighted Discounted Cash Flow	Discount Rate			4.4%
				Probabilities of Payments	—%	-	90.0%
				Projected Years of Payments	2018	-	2022
Total contingent consideration liabilities	$	31

Unobservable Input Reconciliation of Contingent Consideration Liability

Additionally, the following table provides a reconciliation of the beginning and ending balances of the Company's recurring Level 3 fair value measurements (in millions):

	Nanostim			Spinal Modulation			Assumed from Thoratec			Total
Balance as of January 3, 2015	$	50		$	—		$	—		$	50
Initial fair value measurement of contingent consideration	—			155			—			155
Liabilities assumed from Thoratec acquisition	—			—			33			33
Change in fair value of contingent consideration	(48		)	(33		)	(6		)	(87		)
Balance as of January 2, 2016	2			122			27			151
Change in fair value of contingent consideration	—			8			1			9
Transfer out of Level 3 fair value measurement due to contractual settlement	—			(124		)	—			(124		)
Balance as of April 2, 2016	2			6			28			36
Change in fair value of contingent consideration	—			(4		)	(1		)	(5		)
Balance as of July 2, 2016	$	2		$	2		$	27		$	31

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Derivative Financial Instruments (Tables)

6 Months Ended

Jul. 02, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Derivative Instruments (Gain) Loss

The following table provides the (gains) losses related to derivative instruments designated as cash flow hedges for the three and six months ended July 2, 2016 and July 4, 2015, including the location in the Condensed Consolidated Statements of Earnings and the Condensed Consolidated Statements of Comprehensive Income (in millions):

			Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss		in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other		of Derivative as a Result of				and Amount Excluded from
Three	Comprehensive		Reclassification from				Effectiveness Testing
months	Income on Effective		Accumulated Other				Recognized
ended	Portion of Derivative		Comprehensive Income				in Earnings
July 2, 2016	Amount		Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	5	$	—		Cost of sales	$	—	Cost of sales
			Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss		in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other		of Derivative as a Result of				and Amount Excluded from
Six	Comprehensive		Reclassification from				Effectiveness Testing
months	Income on Effective		Accumulated Other				Recognized
ended	Portion of Derivative		Comprehensive Income				in Earnings
July 2, 2016	Amount		Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	44	$	(6	)	Cost of sales	$	—	Cost of sales

				Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss			in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other			of Derivative as a Result of				and Amount Excluded from
Three	Comprehensive			Reclassification from				Effectiveness Testing
months	Income on Effective			Accumulated Other				Recognized
ended	Portion of Derivative			Comprehensive Income				in Earnings
July 4, 2015	Amount			Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	15		$	(4	)	Cost of sales	$	—	Cost of sales
				Pre-tax (Gain) Loss Recognized				Ineffective Portion of
	Pre-tax (Gain) Loss			in Earnings on Effective Portion				(Gain) Loss on Derivative
	Recognized in Other			of Derivative as a Result of				and Amount Excluded from
Six	Comprehensive			Reclassification from				Effectiveness Testing
months	Income on Effective			Accumulated Other				Recognized
ended	Portion of Derivative			Comprehensive Income				in Earnings
July 4, 2015	Amount			Amount			Location	Amount		Location
Derivatives in Cash Flow Hedging Relationships
Foreign currency forward contracts	$	(19	)	$	(4	)	Cost of sales	$	—	Cost of sales

Derivative Instruments, Gain (Loss), Not Designated as Hedging Instrument

The following table provides the (gains) losses related to derivative instruments not designated as hedging instruments, including the location in the Condensed Consolidated Statements of Earnings (in millions):

Derivatives Not	(Gain) Loss on Derivatives					(Gain) Loss on Derivatives
Designated as	Recognized in Earnings					Recognized in Earnings
Hedging	Three Months Ended					Six Months Ended
Instruments	July 2, 2016			July 4, 2015		July 2, 2016		July 4, 2015			Location
Foreign currency forward contracts	$	(2	)	$	1	$	1	$	(8	)	Other (income) expense

Schedule of Fair Value of Derivative Instruments in Statement of Financial Position

The following table summarizes the fair value of the Company’s derivative instruments and their locations in the Condensed Consolidated Balance Sheets as of July 2, 2016 and January 2, 2016 (in millions):

Fair Value of Derivative Instruments	July 2, 2016			January 2, 2016			Location
Derivatives Designated as Hedging Instruments
Foreign currency forward contracts	$	4		$	14		Other current assets
	1			2			Other assets
	(34		)	(6		)	Other current liabilities
	(5		)	(3		)	Other liabilities
Derivatives Not Designated as Hedging Instruments
Foreign currency forward contracts	—			—			Other current assets
	—			—			Other current liabilities
Total	$	(34	)	$	7

Schedule of Offsetting Derivative Assets

The following tables provide information as though the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria in the event of default or termination as stipulated by the terms of the netting arrangements with each of the counterparties as of July 2, 2016 and January 2, 2016, respectively (in millions):

			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
			Eligible Offsetting
	Gross Amount of		Recognized
	Derivative Assets		Derivative Liabilities
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of July 2, 2016	Balance Sheet		Balance Sheet		Received		Assets
Derivatives subject to master netting agreements	$	3	$	2	$	—	$	1
Derivatives not subject to master netting agreements	2						2
Total	$	5	$	2	$	—	$	3
			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
	Gross Amount of		Eligible Offsetting
	Derivative		Recognized
	Liabilities		Derivative Assets
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of July 2, 2016	Balance Sheet		Balance Sheet		Pledged		Liabilities
Derivatives subject to master netting agreements	$	22	$	2	$	—	$	20
Derivatives not subject to master netting agreements	17						17
Total	$	39	$	2	$	—	$	37

			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
			Eligible Offsetting
	Gross Amount of		Recognized
	Derivative Assets		Derivative Liabilities
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of January 2, 2016	Balance Sheet		Balance Sheet		Received		Assets
Derivatives subject to master netting agreements	$	3	$	1	$	—	$	2
Derivatives not subject to master netting agreements	13						13
Total	$	16	$	1	$	—	$	15
			Gross Amounts not Offset in the Condensed Consolidated Balance Sheet that are Subject to Master Netting Agreements
			Gross Amount of
	Gross Amount of		Eligible Offsetting
	Derivative		Recognized
	Liabilities		Derivative Assets
	Presented in the		Presented in the				Net
	Condensed		Condensed		Cash		Amount of
	Consolidated		Consolidated		Collateral		Derivative
Derivatives as of January 2, 2016	Balance Sheet		Balance Sheet		Pledged		Liabilities
Derivatives subject to master netting agreements	$	1	$	1	$	—	$	—
Derivatives not subject to master netting agreements	8						8
Total	$	9	1		$	—	$	8

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Basis Of Presentation (Details)	6 Months Ended
	Jul. 02, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of principal product categories	5

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Debt - Schedule Of Long-Term Debt (Details) - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
Debt Instrument
Total debt	$ 6,091	$ 6,392
Less: current debt obligations	660	1,163
Long-term debt	5,431	5,229
Term Loan Due 2020 | Loans Payable
Debt Instrument
Total debt	2,368	2,093
2016 Senior Notes | Senior Notes
Debt Instrument
Total debt	0	500
2018 Senior Notes | Senior Notes
Debt Instrument
Total debt	497	496
2020 Senior Notes | Senior Notes
Debt Instrument
Total debt	496	496
2023 Senior Notes | Senior Notes
Debt Instrument
Total debt	892	892
2025 Senior Notes | Senior Notes
Debt Instrument
Total debt	494	494
2043 Senior Notes | Senior Notes
Debt Instrument
Total debt	690	689
Yen-denominated Senior Notes Due 2017 | Senior Notes
Debt Instrument
Total debt	79	68
Yen-denominated Senior Notes Due 2020 | Senior Notes
Debt Instrument
Total debt	124	106
Yen-denominated credit facilities | Line of Credit
Debt Instrument
Total debt	64	54
Commercial paper borrowings | Commercial Paper
Debt Instrument
Total debt	$ 387	$ 504

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Debt - Schedule of Maturities of Long-term Debt (Details) $ in Millions	Jul. 02, 2016 USD ($)
Debt Disclosure [Abstract]
Remainder of 2016	$ 453
2017	272
2018	598
2019	227
2020	2,478
After 2020	$ 2,100

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Debt (Details) - 6 months ended Jul. 02, 2016 ¥ in Millions	USD ($)	JPY (¥)	USD ($)
Debt Instrument
Repayments of commercial paper	$ 117,000,000
2016 Senior Notes | Senior Notes
Debt Instrument
Face amount of debt			$ 500,000,000
Debt instrument term	5 years
Stated percentage		2.50%	2.50%
Term loan due August 2020 | Loans Payable
Debt Instrument
Face amount of debt			$ 2,600,000,000.0
Debt instrument term	5 years
Remaining borrowing capacity			500,000,000
Principal payment	$ 59,000,000
Prepaid amount of debt	$ 167,000,000
Yen Denominated Credit Facilities, Due in March 2017 | Line of Credit
Debt Instrument
Line of credit		¥ 3,250	32,000,000
Extension period	1 year
Basis spread on variable rate	0.25%
Yen Denominated Credit Facilities, Due in June 2017 | Line of Credit
Debt Instrument
Line of credit		¥ 3,250	$ 32,000,000
Extension period	1 year
Basis spread on variable rate	0.27%

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Commitments And Contingencies (Details) $ in Thousands			1 Months Ended	3 Months Ended
	Jul. 13, 2016 USD ($)	Jul. 05, 2016 case	Mar. 31, 2013 case	Jul. 02, 2016 USD ($)
December 2012 Securities Litigation
Loss Contingencies [Line Items]
Number of cases consolidated | case			2
Litigation settlement amount				$ 39,250
Insurance recoveries amount				$ 39,250
Subsequent Event | December 2012 Securities Litigation
Loss Contingencies [Line Items]
Insurance recoveries amount	$ 39,250
Subsequent Event | Abbott Merger Lawsuits
Loss Contingencies [Line Items]
Number of cases consolidated | case		2

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Commitments And Contingencies - Schedule Of Product Warranty Liability (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Movement in Standard Product Warranty Accrual [Roll Forward]
Balance at beginning of period	$ 26	$ 32	$ 31	$ 35
Warranty expense (benefit) recognized	2	(2)	1	(4)
Warranty credits issued	(3)	(1)	(7)	(2)
Balance at end of period	$ 25	$ 29	$ 25	$ 29

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Special Charges (Details) $ in Thousands	3 Months Ended					12 Months Ended
	Jul. 02, 2016 USD ($)	Apr. 02, 2016 USD ($) settlement	Jan. 02, 2016 USD ($)	Jul. 04, 2015 USD ($)	Apr. 04, 2015 USD ($)	Jan. 02, 2016 USD ($)	Dec. 29, 2012 division
Purchased In-Process Research And Development (IPR&D) And Special Charges
Litigation settlement gains (losses)		$ 19,000
Number of legal settlements | settlement		2
Loss (benefit) contingency in period		$ 2,000
Restructuring-related costs	$ 1,000	2,000
Field Action Costs | Operating Expense
Purchased In-Process Research And Development (IPR&D) And Special Charges
Litigation charges	3,000	3,000		$ 3,000	$ 5,000
Field Action Costs, Scrapped Inventory and Warranty Costs | Cost of sales
Purchased In-Process Research And Development (IPR&D) And Special Charges
Loss (benefit) contingency in period	5,000
Field Action Costs, Salvaged Inventory | Cost of sales
Purchased In-Process Research And Development (IPR&D) And Special Charges
Loss (benefit) contingency in period	(2,000)			$ (2,000)	(2,000)
December 2012 Securities Litigation
Purchased In-Process Research And Development (IPR&D) And Special Charges
Litigation settlement gains (losses)	(39,250)
Insurance recoveries amount	39,250
Separate Legal Case During Second Quarter of 2016
Purchased In-Process Research And Development (IPR&D) And Special Charges
Litigation settlement gains (losses)	2,000
March 2010 Securities Class Action
Purchased In-Process Research And Development (IPR&D) And Special Charges
Insurance recoveries					$ 10,000
2016 Initiatives
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges	12,000	24,000	$ 34,000
2016 Initiatives | Operating Expense
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges	10,000	20,000				$ 22,000
2016 Initiatives | Cost of sales
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges	2,000	4,000				12,000
Manufacturing and Supply Chain Optimization Plan
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges	2,000	1,000				78,000
Manufacturing and Supply Chain Optimization Plan | Operating Expense
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges	1,000					49,000
Manufacturing and Supply Chain Optimization Plan | Cost of sales
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges	1,000	1,000				29,000
2012 Business Realignment Restructuring Plan
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges						14,000
Number of operating divisions | division							2
2012 Business Realignment Restructuring Plan | Operating Expense
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges						9,000
2012 Business Realignment Restructuring Plan | Cost of sales
Purchased In-Process Research And Development (IPR&D) And Special Charges
Special charges		$ (2,000)				$ 5,000
Minimum | 2016 Initiatives
Purchased In-Process Research And Development (IPR&D) And Special Charges
Expected cost remaining	20,000
Maximum | 2016 Initiatives
Purchased In-Process Research And Development (IPR&D) And Special Charges
Expected cost remaining	$ 25,000

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Special Charges - Summary Of Activity Related To Special Charge Restructuring Accrual (Details) - USD ($) $ in Millions	3 Months Ended				12 Months Ended
	Jul. 02, 2016	Apr. 02, 2016	Jan. 02, 2016	Apr. 04, 2015	Jan. 02, 2016
2016 Initiatives
Restructuring Reserve [Roll Forward]
Balance at beginning	$ 9	$ 29		$ 0	$ 0
Special charges, total	12	24	$ 34
Non-cash charges used		(7)			(2)
Cash payments	(10)	(37)			(3)
Balance at ending	11	9	29		29
2016 Initiatives | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Balance at beginning	8	29		0	0
Non-cash charges used		0			0
Cash payments	(6)	(32)			(2)
Balance at ending	8	8	29		29
2016 Initiatives | Inventory Charges
Restructuring Reserve [Roll Forward]
Balance at beginning	0	0		0	0
Non-cash charges used		(2)			(1)
Cash payments	0	0			0
Balance at ending	0	0	0		0
2016 Initiatives | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Balance at beginning	0	0		0	0
Special charges, fixed asset charges		5
Non-cash charges used		(5)			(1)
Cash payments	0	0			0
Balance at ending	0	0	0		0
2016 Initiatives | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Balance at beginning	1	0		0	0
Non-cash charges used		0			0
Cash payments	(4)	(5)			(1)
Balance at ending	3	1	0		0
2016 Initiatives | Cost of sales
Restructuring Reserve [Roll Forward]
Special charges, total	2	4			12
2016 Initiatives | Cost of sales | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Special charges, employee terminations costs	0	0			9
2016 Initiatives | Cost of sales | Inventory Charges
Restructuring Reserve [Roll Forward]
Special charges, inventory charges	0	2			1
2016 Initiatives | Cost of sales | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Special charges, fixed asset charges	0	1			1
2016 Initiatives | Cost of sales | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Special charges, other restructuring costs	2	1			1
2016 Initiatives | Operating Expense
Restructuring Reserve [Roll Forward]
Special charges, total	10	20			22
2016 Initiatives | Operating Expense | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Special charges, employee terminations costs	6	11			22
2016 Initiatives | Operating Expense | Inventory Charges
Restructuring Reserve [Roll Forward]
Special charges, inventory charges	0	0			0
2016 Initiatives | Operating Expense | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Special charges, fixed asset charges	0	4			0
2016 Initiatives | Operating Expense | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Special charges, other restructuring costs	4	5			0
Manufacturing and Supply Chain Optimization Plan
Restructuring Reserve [Roll Forward]
Balance at beginning	9	17		20	20
Special charges, total	2	1			78
Non-cash charges used					(18)
Cash payments	(5)	(9)			(62)
Balance at ending	6	9	17		17
Manufacturing and Supply Chain Optimization Plan | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Balance at beginning	8	11		14	14
Non-cash charges used					0
Cash payments	(3)	(3)			(27)
Balance at ending	5	8	11		11
Manufacturing and Supply Chain Optimization Plan | Inventory Charges
Restructuring Reserve [Roll Forward]
Balance at beginning	0	0		0	0
Non-cash charges used					(3)
Cash payments	0	0			0
Balance at ending	0	0	0		0
Manufacturing and Supply Chain Optimization Plan | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Balance at beginning	0	0		0	0
Non-cash charges used					(15)
Cash payments	0	0			0
Balance at ending	0	0	0		0
Manufacturing and Supply Chain Optimization Plan | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Balance at beginning	1	6		6	6
Non-cash charges used					0
Cash payments	(2)	(6)			(35)
Balance at ending	1	1	6		6
Manufacturing and Supply Chain Optimization Plan | Cost of sales
Restructuring Reserve [Roll Forward]
Special charges, total	1	1			29
Manufacturing and Supply Chain Optimization Plan | Cost of sales | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Special charges, employee terminations costs	0	0			4
Manufacturing and Supply Chain Optimization Plan | Cost of sales | Inventory Charges
Restructuring Reserve [Roll Forward]
Special charges, inventory charges	0	0			3
Manufacturing and Supply Chain Optimization Plan | Cost of sales | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Special charges, fixed asset charges	0	0			15
Manufacturing and Supply Chain Optimization Plan | Cost of sales | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Special charges, other restructuring costs	1	1			7
Manufacturing and Supply Chain Optimization Plan | Operating Expense
Restructuring Reserve [Roll Forward]
Special charges, total	1				49
Manufacturing and Supply Chain Optimization Plan | Operating Expense | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Special charges, employee terminations costs	0				20
Manufacturing and Supply Chain Optimization Plan | Operating Expense | Inventory Charges
Restructuring Reserve [Roll Forward]
Special charges, inventory charges	0				0
Manufacturing and Supply Chain Optimization Plan | Operating Expense | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Special charges, fixed asset charges	0				0
Manufacturing and Supply Chain Optimization Plan | Operating Expense | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Special charges, other restructuring costs	1				29
2012 Business Realignment Restructuring Plan
Restructuring Reserve [Roll Forward]
Balance at beginning	9	10		38	38
Special charges, total					14
Non-cash charges used		1			(5)
Cash payments	(1)				(35)
Foreign exchange rate impact					(2)
Balance at ending	8	9	10		10
2012 Business Realignment Restructuring Plan | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Balance at beginning	3	3		26	26
Non-cash charges used		0			0
Cash payments	(1)				(25)
Foreign exchange rate impact					(2)
Balance at ending	2	3	3		3
2012 Business Realignment Restructuring Plan | Inventory Charges
Restructuring Reserve [Roll Forward]
Balance at beginning	0	0		0	0
Non-cash charges used		1			(3)
Cash payments	0				0
Foreign exchange rate impact					0
Balance at ending	0	0	0		0
2012 Business Realignment Restructuring Plan | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Balance at beginning	0	0		0	0
Special charges, fixed asset charges				1
Non-cash charges used		0			(2)
Cash payments	0				0
Foreign exchange rate impact					0
Balance at ending	0	0	0		0
2012 Business Realignment Restructuring Plan | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Balance at beginning	6	7		$ 12	12
Non-cash charges used		0			0
Cash payments	0				(10)
Foreign exchange rate impact					0
Balance at ending	$ 6	6	$ 7		7
2012 Business Realignment Restructuring Plan | Cost of sales
Restructuring Reserve [Roll Forward]
Special charges, total		(2)			5
2012 Business Realignment Restructuring Plan | Cost of sales | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Special charges, employee terminations costs		0			2
2012 Business Realignment Restructuring Plan | Cost of sales | Inventory Charges
Restructuring Reserve [Roll Forward]
Special charges, inventory charges		(1)			3
2012 Business Realignment Restructuring Plan | Cost of sales | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Special charges, fixed asset charges		0			0
2012 Business Realignment Restructuring Plan | Cost of sales | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Special charges, other restructuring costs		$ (1)			0
2012 Business Realignment Restructuring Plan | Operating Expense
Restructuring Reserve [Roll Forward]
Special charges, total					9
2012 Business Realignment Restructuring Plan | Operating Expense | Employee Termination Costs
Restructuring Reserve [Roll Forward]
Special charges, employee terminations costs					2
2012 Business Realignment Restructuring Plan | Operating Expense | Inventory Charges
Restructuring Reserve [Roll Forward]
Special charges, inventory charges					0
2012 Business Realignment Restructuring Plan | Operating Expense | Fixed Asset Charges
Restructuring Reserve [Roll Forward]
Special charges, fixed asset charges					2
2012 Business Realignment Restructuring Plan | Operating Expense | Other Restructuring Costs
Restructuring Reserve [Roll Forward]
Special charges, other restructuring costs					$ 5

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Net Earnings Per Share - Schedule of Computation of Basic and Diluted Net Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Earnings Per Share [Abstract]
Net earnings attributable to St. Jude Medical, Inc.	$ 238	$ 290	$ 333	$ 552
Basic weighted average shares outstanding	284.3	281.1	283.9	282.0
Dilution associated with stock-based compensation plans	4.0	4.4	3.4	4.3
Diluted weighted average shares outstanding	288.3	285.5	287.3	286.3
Basic net earnings per share attributable to St. Jude Medical, Inc. (USD per share)	$ 0.84	$ 1.03	$ 1.17	$ 1.96
Diluted net earnings per share attributable to St. Jude Medical, Inc. (USD per share)	$ 0.83	$ 1.02	$ 1.16	$ 1.93
Anti-dilutive shares of common stock excluded from diluted net earnings per share attributable to St. Jude Medical, Inc. (in shares)	3.8	2.6	6.1	3.4

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Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information- Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			$ 4,042	$ 4,244
Other comprehensive income (loss), net of tax	$ (20)	$ 9	(2)	(88)
Ending Balance	4,281	3,841	4,281	3,841
Accumulated Other Comprehensive Income (Loss)
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(327)	(270)	(345)	(173)
Other comprehensive income (loss) before reclassifications	(20)	15	2	(80)
Amounts reclassified to net earnings from accumulated other comprehensive income	0	(6)	(4)	(8)
Other comprehensive income (loss), net of tax	(20)	9	(2)	(88)
Ending Balance	(347)	(261)	(347)	(261)
Unrealized gain (loss) on available-for-sale securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	3	16	3	15
Other comprehensive income (loss) before reclassifications	1	(2)	1	1
Amounts reclassified to net earnings from accumulated other comprehensive income	0	(2)	0	(4)
Other comprehensive income (loss), net of tax	1	(4)	1	(3)
Ending Balance	4	12	4	12
Unrealized gain (loss) on derivative instruments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(19)	32	11	3
Other comprehensive income (loss) before reclassifications	(4)	(13)	(30)	16
Amounts reclassified to net earnings from accumulated other comprehensive income	0	(4)	(4)	(4)
Other comprehensive income (loss), net of tax	(4)	(17)	(34)	12
Ending Balance	(23)	15	(23)	15
Foreign currency translation adjustment
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(311)	(318)	(359)	(191)
Other comprehensive income (loss) before reclassifications	(17)	30	31	(97)
Amounts reclassified to net earnings from accumulated other comprehensive income	0	0	0	0
Other comprehensive income (loss), net of tax	(17)	30	31	(97)
Ending Balance	$ (328)	$ (288)	$ (328)	$ (288)

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Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information - Schedule of Reclassification out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other (income) expense	$ 3	$ 0	$ 56	$ (3)
Cost of sales	(496)	(424)	(983)	(819)
Income tax expense	32	12	73	64
Net earnings attributable to St. Jude Medical, Inc.	(238)	(290)	(333)	(552)
Unrealized gain (loss) on available-for-sale securities | Reclassification out of Accumulated Other Comprehensive Income
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Other (income) expense	0	(3)	0	(7)
Income tax expense	0	1	0	3
Net earnings attributable to St. Jude Medical, Inc.	0	(2)	0	(4)
Unrealized gain (loss) on derivative instruments | Reclassification out of Accumulated Other Comprehensive Income
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Cost of sales	0	(4)	(6)	(4)
Income tax expense	0	0	2	0
Net earnings attributable to St. Jude Medical, Inc.	$ 0	$ (4)	$ (4)	$ (4)

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Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information (Details) - USD ($) $ / shares in Units, shares in Millions		1 Months Ended	3 Months Ended		6 Months Ended
	May 04, 2016	Mar. 02, 2015	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015	Jan. 13, 2015	Jun. 07, 2013
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Cash dividends declared per share (USD per share)	$ 0.31		$ 0.31	$ 0.29	$ 0.62	$ 0.58
Authorized amount							$ 500,000,000
Shares repurchased, shares		7.5
Shares repurchased, value		$ 500,000,000				$ 500,000,000
Average repurchase price (USD per share)		$ 66.96
Business Combination, Separately Recognized Transactions [Line Items]
Additions (purchases) of noncontrolling ownership interests						$ 330,000,000
Spinal Modulation
Business Combination, Separately Recognized Transactions [Line Items]
Equity investment								$ 40,000,000
Voting equity interest								19.00%
Additions (purchases) of noncontrolling ownership interests				$ 173,000,000
Ownership percentage by noncontrolling owners				81.00%		81.00%
Contingent consideration				$ 155,000,000		$ 155,000,000
Increase (decrease) in stockholders' equity				(297,000,000)
Increase (decrease) in noncontrolling interest				$ (33,000,000)

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Accumulated Other Comprehensive Income (Loss) and Supplemental Equity Information- Supplemental Equity Schedule (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		6 Months Ended
	Mar. 02, 2015	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance				$ 4,042	$ 4,244
Net earnings		$ 238	$ 282	333	538
Other comprehensive income (loss)		(20)	9	(2)	(88)
Cash dividends declared				(176)	(163)
Repurchases of common stock	$ (500)				(500)
Stock-based compensation				60	37
Common stock issued under employee stock plans and other, net				22	89
Tax benefit from stock plans				2	14
Additions (purchases) of noncontrolling ownership interests					(330)
Ending Balance		4,281	3,841	4,281	3,841
Shareholders' Equity Before Noncontrolling Interest
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance				4,042	4,199
Net earnings				333	552
Other comprehensive income (loss)				(2)	(88)
Cash dividends declared				(176)	(163)
Repurchases of common stock					(500)
Stock-based compensation				60	35
Common stock issued under employee stock plans and other, net				22	89
Tax benefit from stock plans				2	14
Additions (purchases) of noncontrolling ownership interests					(297)
Ending Balance		4,281	3,841	4,281	3,841
Noncontrolling Interest
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance				0	45
Net earnings				0	(14)
Other comprehensive income (loss)				0	0
Cash dividends declared				0	0
Repurchases of common stock					0
Stock-based compensation				0	2
Common stock issued under employee stock plans and other, net				0	0
Tax benefit from stock plans				0	0
Additions (purchases) of noncontrolling ownership interests					(33)
Ending Balance		$ 0	$ 0	$ 0	$ 0

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Income Taxes (Details) € in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016 USD ($)	Jul. 04, 2015	Jul. 02, 2016 USD ($)	Jul. 04, 2015	Jul. 02, 2016 EUR (€)	Apr. 02, 2016 EUR (€)	Jan. 02, 2016 USD ($)
Income Tax Disclosure [Abstract]
Unrecognized tax benefits	$ 405		$ 405				$ 338
Accrued interest and penalties	$ 56		$ 56				$ 58
Effective income tax rate reconciliation, percent	11.90%	4.10%	18.00%	10.60%
Special charges, acquisition-related costs, adjustments to contingent consideration liabilities and discrete tax items	1.50%	13.20%	(5.10%)	6.50%
Liability for uncertain tax positions	$ 48		$ 48		€ 43	€ 46

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Fair Value Measurements - Summary Of Components Of Available-For-Sale Securities (Details) - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
Fair Value Disclosures [Abstract]
Adjusted cost	$ 5	$ 5
Gross unrealized gains	6	6
Gross unrealized losses	0	(1)
Fair value	$ 11	$ 10

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Fair Value Measurements - Summary of Financial Assets Measured at Fair Value, Recurring Basis (Details) - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	$ 11	$ 10
Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	380	601
Total liabilities	70	160
Recurring | Cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money-market securities	52	273
Recurring | Other current assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	11	10
Derivative assets, foreign currency forward contracts	4	14
Recurring | Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets, foreign currency forward contracts	1	2
Trading securities	312	302
Recurring | Other current liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration		118
Derivative liabilities, foreign currency forward contracts	34	6
Recurring | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	31	33
Derivative liabilities, foreign currency forward contracts	5	3
Recurring | Quoted Prices In Active Markets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	375	585
Total liabilities	0	0
Recurring | Quoted Prices In Active Markets (Level 1) | Cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money-market securities	52	273
Recurring | Quoted Prices In Active Markets (Level 1) | Other current assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	11	10
Derivative assets, foreign currency forward contracts	0	0
Recurring | Quoted Prices In Active Markets (Level 1) | Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets, foreign currency forward contracts	0	0
Trading securities	312	302
Recurring | Quoted Prices In Active Markets (Level 1) | Other current liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration		0
Derivative liabilities, foreign currency forward contracts	0	0
Recurring | Quoted Prices In Active Markets (Level 1) | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	0	0
Derivative liabilities, foreign currency forward contracts	0	0
Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	5	16
Total liabilities	39	9
Recurring | Significant Other Observable Inputs (Level 2) | Cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money-market securities	0	0
Recurring | Significant Other Observable Inputs (Level 2) | Other current assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Derivative assets, foreign currency forward contracts	4	14
Recurring | Significant Other Observable Inputs (Level 2) | Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets, foreign currency forward contracts	1	2
Trading securities	0	0
Recurring | Significant Other Observable Inputs (Level 2) | Other current liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration		0
Derivative liabilities, foreign currency forward contracts	34	6
Recurring | Significant Other Observable Inputs (Level 2) | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	0	0
Derivative liabilities, foreign currency forward contracts	5	3
Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	0	0
Total liabilities	31	151
Recurring | Significant Unobservable Inputs (Level 3) | Cash and cash equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money-market securities	0	0
Recurring | Significant Unobservable Inputs (Level 3) | Other current assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	0	0
Derivative assets, foreign currency forward contracts	0	0
Recurring | Significant Unobservable Inputs (Level 3) | Other assets
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets, foreign currency forward contracts	0	0
Trading securities	0	0
Recurring | Significant Unobservable Inputs (Level 3) | Other current liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration		118
Derivative liabilities, foreign currency forward contracts	0	0
Recurring | Significant Unobservable Inputs (Level 3) | Other liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Contingent consideration	31	33
Derivative liabilities, foreign currency forward contracts	$ 0	$ 0

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Fair Value Measurements - Summary of Level 3 Fair Value Measurements of Contingent Consideration (Details) - Fair Value, Inputs, Level 3 - USD ($) $ in Millions	6 Months Ended
	Jul. 02, 2016	Apr. 02, 2016	Jan. 02, 2016	Jan. 03, 2015
Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 31	$ 36	$ 151	$ 50
Spinal Modulation | Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 2	6	122	0
Spinal Modulation | Monte Carlo Simulation
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Expected revenue volatility	25.00%
Spinal Modulation | Monte Carlo Simulation | Minimum
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount Rate	0.60%
Spinal Modulation | Monte Carlo Simulation | Maximum
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount Rate	15.50%
Spinal Modulation | Monte Carlo Simulation | Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 2
Nanostim | Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 2	2	2	50
Nanostim | Probability Weighted Discounted Cash Flow
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount Rate	5.00%
Probability of Payments	10.00%
Nanostim | Probability Weighted Discounted Cash Flow | Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 2
Thoratec | Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 27	$ 28	$ 27	$ 0
Thoratec | Probability Weighted Discounted Cash Flow
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount Rate	4.40%
Thoratec | Probability Weighted Discounted Cash Flow | Minimum
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Probability of Payments	0.00%
Thoratec | Probability Weighted Discounted Cash Flow | Maximum
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Probability of Payments	90.00%
Thoratec | Probability Weighted Discounted Cash Flow | Contingent Consideration Liabilities
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Contingent Consideration Liabilities	$ 27

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Fair Value Measurements - Unobservable Input Reconciliation of Contingent Consideration Liability (Details) - Fair Value, Inputs, Level 3 - Contingent Consideration Liabilities - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Jul. 02, 2016	Apr. 02, 2016	Jan. 02, 2016
Contingent Consideration Liability [Roll Forward]
Beginning balance	$ 36	$ 151	$ 50
Initial fair value measurement of contingent consideration			155
Liabilities assumed from Thoratec acquisition			33
Change in fair value of contingent consideration	(5)	9	(87)
Transfer out of Level 3 fair value measurement due to contractual settlement		(124)
Ending balance	31	36	151
Nanostim
Contingent Consideration Liability [Roll Forward]
Beginning balance	2	2	50
Initial fair value measurement of contingent consideration			0
Liabilities assumed from Thoratec acquisition			0
Change in fair value of contingent consideration	0	0	(48)
Transfer out of Level 3 fair value measurement due to contractual settlement		0
Ending balance	2	2	2
Spinal Modulation
Contingent Consideration Liability [Roll Forward]
Beginning balance	6	122	0
Initial fair value measurement of contingent consideration			155
Liabilities assumed from Thoratec acquisition			0
Change in fair value of contingent consideration	(4)	8	(33)
Transfer out of Level 3 fair value measurement due to contractual settlement		(124)
Ending balance	2	6	122
Thoratec
Contingent Consideration Liability [Roll Forward]
Beginning balance	28	27	0
Initial fair value measurement of contingent consideration			0
Liabilities assumed from Thoratec acquisition			33
Change in fair value of contingent consideration	(1)	1	(6)
Transfer out of Level 3 fair value measurement due to contractual settlement		0
Ending balance	$ 27	$ 28	$ 27

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Fair Value Measurements (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 02, 2016	Apr. 04, 2015	Jul. 02, 2016	Jan. 02, 2016
Fair Value Inputs, Liabilities, Quantitative Information
Cost method investments			$ 59	$ 80
Fixed rate debt obligations fair value disclosure			3,470
Fixed rate debt obligations carrying value			3,272
Other debt carrying value			2,819
Cash equivalents at carrying value excluding money market securities			$ 346	$ 393
Other (income) expense
Fair Value Inputs, Liabilities, Quantitative Information
Other-than-temporary impairments	$ 50
Fixed Asset Charges | 2016 Initiatives
Fair Value Inputs, Liabilities, Quantitative Information
Fixed asset charges	$ 5
Fixed Asset Charges | 2012 Business Realignment Restructuring Plan
Fair Value Inputs, Liabilities, Quantitative Information
Fixed asset charges		$ 1

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Derivative Financial Instruments (Details) $ in Millions	6 Months Ended
	Jul. 02, 2016 USD ($) bank
Derivatives, Fair Value [Line Items]
After-tax net unrealized loss related to foreign currency forward contracts recorded in accumulated other comprehensive income	$ 27
Unrealized losses expected to be reclassed to earnings over the next 12 months	$ 19
Number of applicable banks and financial institutions that contain netting provisions | bank	4
Foreign currency forward contracts | Designated as Hedging Instrument | Cash Flow Hedging
Derivatives, Fair Value [Line Items]
Maximum length of time hedged in cash flow hedge	24 months
Gross notional amount of derivative	$ 1,000
Foreign currency forward contracts | Not Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Gross notional amount of derivative	$ 200

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Derivative Financial Instruments Summary of Derivative Instruments (Gain) Loss (Details) - Foreign currency forward contracts - Designated as Hedging Instrument - Cash Flow Hedging - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Derivative Instruments, (Gain) Loss [Line Items]
Pre-tax (gain) loss recognized in other comprehensive income on effective portion of derivative	$ 5	$ 15	$ 44	$ (19)
Cost of sales
Derivative Instruments, (Gain) Loss [Line Items]
Pre-tax (Gain) Loss Recognized in Earnings on Effective Portion of Derivative as a Result of Reclassification from Accumulated Other Comprehensive Income	0	(4)	(6)	(4)
Ineffective Portion of (Gain) Loss on Derivative and Excluded from Effectiveness Testing Recognized in Earnings	$ 0	$ 0	$ 0	$ 0

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Derivative Financial Instruments Summary of Derivative Instruments (Gain) Loss, Not Designated as Hedging (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 02, 2016	Jul. 04, 2015	Jul. 02, 2016	Jul. 04, 2015
Foreign currency forward contracts | Other (income) expense | Not Designated as Hedging Instrument
Derivative Instruments, (Gain) Loss [Line Items]
(Gain) Loss on Derivatives Recognized in Earnings	$ (2)	$ 1	$ 1	$ (8)

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Derivative Financial Instruments Schedule of Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
Derivatives, Fair Value [Line Items]
Derivative asset	$ 3	$ 3
Derivative liability	(22)	(1)
Foreign currency forward contracts
Derivatives, Fair Value [Line Items]
Total	(34)	7
Foreign currency forward contracts | Designated as Hedging Instrument | Other current assets
Derivatives, Fair Value [Line Items]
Derivative asset	4	14
Foreign currency forward contracts | Designated as Hedging Instrument | Other assets
Derivatives, Fair Value [Line Items]
Derivative asset	1	2
Foreign currency forward contracts | Designated as Hedging Instrument | Other current liabilities
Derivatives, Fair Value [Line Items]
Derivative liability	(34)	(6)
Foreign currency forward contracts | Designated as Hedging Instrument | Other liabilities
Derivatives, Fair Value [Line Items]
Derivative liability	(5)	(3)
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other current assets
Derivatives, Fair Value [Line Items]
Derivative asset	0	0
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other current liabilities
Derivatives, Fair Value [Line Items]
Derivative liability	$ 0	$ 0

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Derivative Financial Instruments Schedule of Offsetting Derivative Assets (Details) - USD ($) $ in Millions	Jul. 02, 2016	Jan. 02, 2016
Assets
Gross amount of derivatives subject to master netting agreements	$ 3	$ 3
Gross amount of eligible offsetting recognized derivative liabilities	2	1
Gross amount of derivatives not subject to master netting agreements	2	13
Gross amount of derivatives	5	16
Gross amount of cash collateral received not offset	0	0
Net amount of derivatives	1	2
Total	3	15
Liabilities
Gross amount of derivatives subject to master netting agreements	22	1
Gross amount of eligible offsetting recognized derivative assets	2	1
Gross amount of derivatives not subject to master netting agreements	17	8
Gross amount of derivatives	39	9
Cash collateral pledged	0	0
Net amount of derivatives	20	0
Total	$ 37	$ 8

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Business Combinations (Details) - USD ($) $ in Millions	1 Months Ended
	Feb. 29, 2016	Jul. 02, 2016	Jan. 02, 2016
Business Acquisition [Line Items]
Goodwill		$ 5,670	$ 5,651
Middle East distributor
Business Acquisition [Line Items]
Total purchase consideration	$ 19
Goodwill	5
Customer relationship | Middle East distributor
Business Acquisition [Line Items]
Intangible assets from business combination	$ 7

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Abbott Transaction (Details)	Jul. 11, 2016	Apr. 27, 2016 $ / shares
Subsequent Event [Line Items]
Business acquisition, share price		$ 46.75
Business acquisition, share ratio		0.8708
Subsequent Event
Subsequent Event [Line Items]
Business acquisition, extended waiting period	30 days