10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2022

OR

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

Commission file number: 001-13149

STRYKER CORPORATION
(Exact name of registrant as specified in its charter)

Michigan			38-1239739
(State of incorporation)			(I.R.S. Employer Identification No.)
2825 Airview Boulevard	Kalamazoo,	Michigan	49002
(Address of principal executive offices)			(Zip Code)
	(269)	385-2600
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.10 Par Value	SYK	New York Stock Exchange
1.125% Notes due 2023	SYK23	New York Stock Exchange
0.250% Notes due 2024	SYK24A	New York Stock Exchange
2.125% Notes due 2027	SYK27	New York Stock Exchange
0.750% Notes due 2029	SYK29	New York Stock Exchange
2.625% Notes due 2030	SYK30	New York Stock Exchange
1.000% Notes due 2031	SYK31	New York Stock Exchange

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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ☒    No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes ☒    No ☐

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

Large accelerated filer	☒	Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☐	Small reporting company	☐

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

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

There were 378,429,929 shares of Common Stock, $0.10 par value, on September 30, 2022.

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Stryker Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)

	Three Months				Nine Months
	2022		2021		2022		2021
Net sales	$	4,479	$	4,160	$	13,247	$	12,407
Cost of sales	1,697		1,518		4,905		4,484
Gross profit	$	2,782	$	2,642	$	8,342	$	7,923
Research, development and engineering expenses	364		306		1,128		904
Selling, general and administrative expenses	1,455		1,602		4,704		4,682
Recall charges	(4)		16		14		98
Amortization of intangible assets	159		144		469		474
Total operating expenses	$	1,974	$	2,068	$	6,315	$	6,158
Operating income	$	808	$	574	$	2,027	$	1,765
Other income (expense), net	8		(79)		(105)		(241)
Earnings before income taxes	$	816	$	495	$	1,922	$	1,524
Income taxes	—		57		127		192
Net earnings	$	816	$	438	$	1,795	$	1,332
Net earnings per share of common stock:
Basic	$	2.16	$	1.17	$	4.75	$	3.54
Diluted	$	2.14	$	1.14	$	4.70	$	3.48
Weighted-average shares outstanding (in millions):
Basic	378.4		377.1		378.1		376.8
Effect of dilutive employee stock compensation	3.4		5.6		4.1		5.5
Diluted	381.8		382.7		382.2		382.3
Cash dividends declared per share of common stock	$	0.695	$	0.63	$	2.085	$	1.89

Anti-dilutive shares excluded from the calculation of dilutive employee stock options were 5.0 for the three months 2022 and 4.2 for the nine months 2022 and de minimis in all other periods.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

	Three Months				Nine Months
	2022		2021		2022		2021
Net earnings	$	816	$	438	$	1,795	$	1,332
Other comprehensive income (loss), net of tax:
Marketable securities	—		3		(1)		3
Pension plans	10		5		17		8
Unrealized gains (losses) on designated hedges	8		7		33		43
Financial statement translation	179		112		393		287
Total other comprehensive income (loss), net of tax	$	197	$	127	$	442	$	341
Comprehensive income	$	1,013	$	565	$	2,237	$	1,673

See accompanying notes to Consolidated Financial Statements.

Dollar amounts are in millions except per share amounts or as otherwise specified. 1

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

CONSOLIDATED BALANCE SHEETS

	September 30		December 31
	2022		2021
	(Unaudited)
Assets
Current assets
Cash and cash equivalents	$	1,420	$	2,944
Marketable securities	77		75
Accounts receivable, less allowance of $150 ($167 in 2021)	3,103		3,022
Inventories:
Materials and supplies	852		691
Work in process	309		264
Finished goods	2,722		2,359
Total inventories	$	3,883	$	3,314
Prepaid expenses and other current assets	835		662
Total current assets	$	9,318	$	10,017
Property, plant and equipment:
Land, buildings and improvements	1,665		1,656
Machinery and equipment	3,869		3,842
Total property, plant and equipment	$	5,534	$	5,498
Less accumulated depreciation	2,736		2,665
Property, plant and equipment, net	$	2,798	$	2,833
Goodwill	14,993		12,918
Other intangibles, net	5,053		4,840
Noncurrent deferred income tax assets	1,390		1,760
Other noncurrent assets	2,431		2,263
Total assets	$	35,983	$	34,631
Liabilities and shareholders' equity
Current liabilities
Accounts payable	$	1,213	$	1,129
Accrued compensation	927		1,092
Income taxes	243		192
Dividends payable	263		263
Accrued product liabilities	391		401
Accrued expenses and other liabilities	1,526		1,465
Current maturities of debt	8		7
Total current liabilities	$	4,571	$	4,549
Long-term debt, excluding current maturities	12,751		12,472
Income taxes	621		913
Other noncurrent liabilities	1,577		1,820
Total liabilities	$	19,520	$	19,754
Shareholders' equity
Common stock, $0.10 par value	38		38
Additional paid-in capital	2,028		1,890
Retained earnings	14,486		13,480
Accumulated other comprehensive loss	(89)		(531)
Total shareholders' equity	$	16,463	$	14,877
Total liabilities and shareholders' equity	$	35,983	$	34,631

See accompanying notes to Consolidated Financial Statements.

Dollar amounts are in millions except per share amounts or as otherwise specified. 2

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)

	Three Months				Nine Months
	2022		2021		2022		2021
Common stock shares outstanding (in millions)
Beginning	378.3		377.1		377.5		376.1
Issuance of common stock under stock compensation and benefit plans	0.1		0.1		0.9		1.1
Ending	378.4		377.2		378.4		377.2
Common stock
Beginning	$	38	$	38	$	38	$	38
Issuance of common stock under stock compensation and benefit plans	—		—		—		—
Ending	$	38	$	38	$	38	$	38
Additional paid-in capital
Beginning	$	1,989	$	1,844	$	1,890	$	1,741
Issuance of common stock under stock compensation and benefit plans	6		(3)		(2)		(7)
Share-based compensation	33		34		140		141
Ending	$	2,028	$	1,875	$	2,028	$	1,875
Retained earnings
Beginning	$	13,933	$	12,881	$	13,480	$	12,462
Net earnings	816		438		1,795		1,332
Cash dividends declared	(263)		(238)		(789)		(713)
Ending	$	14,486	$	13,081	$	14,486	$	13,081
Accumulated other comprehensive income (loss)
Beginning	$	(286)	$	(943)	$	(531)	$	(1,157)
Other comprehensive income (loss)	197		127		442		341
Ending	$	(89)	$	(816)	$	(89)	$	(816)
Total shareholders' equity	$	16,463	$	14,178	$	16,463	$	14,178

See accompanying notes to Consolidated Financial Statements.

Dollar amounts are in millions except per share amounts or as otherwise specified. 3

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

	Nine Months
	2022		2021
Operating activities
Net earnings	$	1,795	$	1,332
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	276		278
Amortization of intangible assets	469		474
Asset impairments	18		119
Share-based compensation	140		141
Recall charges	14		98
Sale of inventory stepped-up to fair value at acquisition	12		231
Changes in operating assets and liabilities:
Accounts receivable	(186)		(145)
Inventories	(754)		(231)
Accounts payable	111		134
Accrued expenses and other liabilities	5		184
Recall-related payments	(26)		(180)
Income taxes	(262)		(193)
Other, net	9		21
Net cash provided by operating activities	$	1,621	$	2,263
Investing activities
Acquisitions, net of cash acquired	(2,563)		(226)
Purchases of marketable securities	(43)		(38)
Proceeds from sales of marketable securities	40		43
Purchases of property, plant and equipment	(400)		(319)
Proceeds from settlement of net investment hedges	197		—
Other investing, net	7		(5)
Net cash used in investing activities	$	(2,762)	$	(545)
Financing activities
Proceeds (payments) on short-term borrowings, net	(376)		7
Proceeds from issuance of long-term debt	1,500		5
Payments on long-term debt	(502)		(1,151)
Payments of dividends	(788)		(713)
Cash paid for taxes from withheld shares	(89)		(88)
Other financing, net	(48)		(137)
Net cash provided by (used in) financing activities	$	(303)	$	(2,077)
Effect of exchange rate changes on cash and cash equivalents	(80)		(21)
Change in cash and cash equivalents	$	(1,524)	$	(380)
Cash and cash equivalents at beginning of period	2,944		2,943
Cash and cash equivalents at end of period	$	1,420	$	2,563

See accompanying notes to Consolidated Financial Statements.

Dollar amounts are in millions except per share amounts or as otherwise specified. 4

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

General Information

Management believes the accompanying unaudited Consolidated Financial Statements contain all adjustments, including normal recurring items, considered necessary to fairly present the financial position of Stryker Corporation and its consolidated subsidiaries ("Stryker," the "Company," "we," "us" or "our") on September 30, 2022 and the results of operations for the three and nine months 2022. The results of operations included in these Consolidated Financial Statements may not necessarily be indicative of our annual results. These statements should be read in conjunction with our Annual Report on Form 10-K for 2021.

New Accounting Pronouncements Not Yet Adopted

We evaluate all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB) for consideration of their applicability. ASUs not included in our disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on our Consolidated Financial Statements.

In September 2022 the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations, which requires entities that utilize supplier finance programs in connection with the purchase of goods and services to disclose information about the key terms of the programs, a rollforward of the obligations under the programs and where those obligations are presented in the balance sheet. The new disclosure requirements are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating these new expanded disclosure requirements.

New Accounting Pronouncements Recently Adopted

On January 1, 2022 we adopted ASU 2021-08, Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This update requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers. The adoption of this update did not have a material impact on our Consolidated Financial Statements.

NOTE 2 - REVENUE RECOGNITION

Our policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for 2021.

We disaggregate our net sales by product line and geographic location for each of our segments as we believe it best depicts how the nature, amount, timing and certainty of our net sales and cash flows are affected by economic factors.

Net Sales by Product Line
	Three Months				Nine Months
	2022		2021		2022		2021
MedSurg and Neurotechnology:
Instruments	$	535	$	525	$	1,626	$	1,511
Endoscopy	590		525		1,728		1,512
Medical	765		636		2,095		1,898
Neurovascular	294		295		901		885
Neuro Cranial	332		299		992		890
Other	72		69		218		203
	$	2,588	$	2,349	$	7,560	$	6,899
Orthopaedics and Spine:
Knees	$	481	$	439	$	1,445	$	1,325
Hips	347		328		1,038		990
Trauma and Extremities	672		639		2,033		1,953
Spine	280		282		849		867
Other	111		123		322		373
	$	1,891	$	1,811	$	5,687	$	5,508
Total	$	4,479	$	4,160	$	13,247	$	12,407

Net Sales by Geography
	Three Months 2022				Three Months 2021
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	425	$	110	$	415	$	110
Endoscopy	480		110		418		107
Medical	625		140		496		140
Neurovascular	110		184		113		182
Neuro Cranial	274		58		244		55
Other	71		1		68		1
	$	1,985	$	603	$	1,754	$	595
Orthopaedics and Spine:
Knees	$	365	$	116	$	321	$	118
Hips	225		122		199		129
Trauma and Extremities	494		178		447		192
Spine	206		74		201		81
Other	85		26		97		26
	$	1,375	$	516	$	1,265	$	546
Total	$	3,360	$	1,119	$	3,019	$	1,141

Net Sales by Geography
	Nine Months 2022				Nine Months 2021
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	1,290	$	336	$	1,171	$	340
Endoscopy	1,371		357		1,179		333
Medical	1,686		409		1,457		441
Neurovascular	333		568		339		546
Neuro Cranial	819		173		724		166
Other	214		4		200		3
	$	5,713	$	1,847	$	5,070	$	1,829
Orthopaedics and Spine:
Knees	$	1,078	$	367	$	964	$	361
Hips	657		381		606		384
Trauma and Extremities	1,470		563		1,362		591
Spine	615		234		611		256
Other	243		79		290		83
	$	4,063	$	1,624	$	3,833	$	1,675
Total	$	9,776	$	3,471	$	8,903	$	3,504

Dollar amounts are in millions except per share amounts or as otherwise specified. 5

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

Contract Assets and Liabilities

On September 30, 2022 and December 31, 2021 contract assets recorded in our Consolidated Balance Sheets were not significant.

Our contract liabilities arise as a result of consideration received from customers at inception of contracts for certain businesses or where the timing of billing for services precedes satisfaction of our performance obligations. We generally satisfy performance obligations within one year from the contract inception date. Our contract liabilities were $661 and $529 on September 30, 2022 and December 31, 2021.

NOTE 3 - ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME (AOCI)

Three Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(1)	$	(148)	$	65	$	(202)	$	(286)
OCI	—		11		19		304		334
Income taxes	—		(3)		(1)		(119)		(123)
Reclassifications to:
Cost of sales	—		—		(7)		—		(7)
Other (income) expense, net	—		3		(2)		(8)		(7)
Income taxes	—		(1)		(1)		2		—
Net OCI	$	—	$	10	$	8	$	179	$	197
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Three Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(256)	$	26	$	(710)	$	(943)
OCI	4		2		6		71		83
Income taxes	—		—		(2)		47		45
Reclassifications to:
Cost of sales	—		—		4		—		4
Other (income) expense, net	—		4		(2)		(8)		(6)
Income taxes	(1)		(1)		1		2		1
Net OCI	$	3	$	5	$	7	$	112	$	127
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

Nine Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	—	$	(155)	$	40	$	(416)	$	(531)
OCI	(1)		15		55		658		727
Income taxes	—		(3)		(7)		(242)		(252)
Reclassifications to:
Cost of sales	—		—		(10)		—		(10)
Other (income) expense, net	—		7		(4)		(30)		(27)
Income taxes	—		(2)		(1)		7		4
Net OCI	$	(1)	$	17	$	33	$	393	$	442
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Nine Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(259)	$	(10)	$	(885)	$	(1,157)
OCI	4		1		40		269		314
Income taxes	—		(2)		(13)		37		22
Reclassifications to:
Cost of sales	—		—		9		—		9
Other (income) expense, net	—		12		7		(25)		(6)
Income taxes	(1)		(3)		—		6		2
Net OCI	$	3	$	8	$	43	$	287	$	341
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

NOTE 4 - DERIVATIVE INSTRUMENTS

We use operational and economic hedges, foreign currency exchange forward contracts, net investment hedges (both derivative and non-derivative financial instruments) and interest rate derivative instruments to manage the impact of currency exchange and interest rate fluctuations on earnings, cash flow and equity. We do not enter into derivative instruments for speculative purposes. We are exposed to potential credit loss in the event of nonperformance by our counterparties on our outstanding derivative instruments but do not anticipate nonperformance by any of our counterparties. Should a counterparty default, our maximum loss exposure is the asset balance of the instrument. We have not changed our hedging strategies, accounting practices or objectives from those disclosed in our Annual Report on Form 10-K for 2021.

Foreign Currency Hedges

September 2022	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	923	$	1,448	$	3,137	$	5,508
Maximum term in years							4.1
Fair value:
Other current assets	$	45	$	—	$	140	$	185
Other noncurrent assets	3		185		—		188
Other current liabilities	(7)		—		(10)		(17)
Other noncurrent liabilities	(1)		—		—		(1)
Total fair value	$	40	$	185	$	130	$	355

December 2021	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	973	$	2,266	$	5,512	$	8,751
Maximum term in years							4.9
Fair value:
Other current assets	$	15	$	39	$	92	$	146
Other noncurrent assets	1		65		—		66
Other current liabilities	(7)		—		(10)		(17)
Total fair value	$	9	$	104	$	82	$	195

We had €1.5 billion and €2.0 billion on September 30, 2022 and December 31, 2021 of certain foreign currency forward contracts designated as net investment hedges to hedge a portion of our investments in certain of our entities with functional currencies denominated in Euros. In addition to these derivative financial instruments designated as net investment hedges, we had €4.4 billion on September 30, 2022 and December 31, 2021 of senior unsecured notes designated as net investment hedges to selectively hedge portions of our investment in certain international subsidiaries. The currency effects of our Euro-denominated senior unsecured notes are reflected in AOCI within shareholders' equity where they offset gains and losses recorded on our net investment in international subsidiaries.

In the nine months 2022 we settled certain foreign currency forward contracts designated as net investment hedges resulting in cash proceeds of $197. The amounts in AOCI related to settled net investment hedges will remain in AOCI until the hedged investment is either sold or substantially liquidated.

On September 30, 2022 the total after tax gain (loss) in AOCI related to designated net investment hedges was $603.

Dollar amounts are in millions except per share amounts or as otherwise specified. 6

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

Net Currency Exchange Rate Gains (Losses)

Derivative		Three Months				Nine Months
instrument:	Recorded in:	2022		2021		2022		2021
Cash Flow	Cost of sales	$	7	$	(4)	$	10	$	(9)
Net Investment	Other income (expense), net	8		8		30		25
Non-Designated	Other income (expense), net	(1)		(5)		2		(6)
	Total	$	14	$	(1)	$	42	$	10

Pretax gains (losses) on derivatives designated as cash flow hedges of $50 and net investment hedges of $34 recorded in AOCI are expected to be reclassified to cost of sales and other income (expense), net in earnings within 12 months as of September 30, 2022. This cash flow hedge reclassification is primarily due to the sale of inventory that includes previously hedged purchases. A component of the AOCI amounts related to net investment hedges is reclassified over the life of the hedge instruments as we elected to exclude the initial value of the component related to the spot-forward difference from the effectiveness assessment.

Interest Rate Hedges

Pretax gains of $5 recorded in AOCI related to other interest rate hedges closed in conjunction with debt issuances are expected to be reclassified to other income (expense), net in earnings within 12 months of September 30, 2022. The cash flow effect of interest rate hedges is recorded in cash flow from operations.

NOTE 5 - FAIR VALUE MEASUREMENTS

Our policies for managing risk related to foreign currency, interest rates, credit and markets and our process for determining fair value have not changed from those described in our Annual Report on Form 10-K for 2021.

During the three months 2022 we determined that certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded a $110 reduction in the fair value of contingent consideration reflected in selling, general and administrative expenses.

There were no significant transfers into or out of any level of the fair value hierarchy in 2022.

Assets Measured at Fair Value	September		December
	2022		2021
Cash and cash equivalents	$	1,420	$	2,944
Trading marketable securities	155		193
Level 1 - Assets	$	1,575	$	3,137
Available-for-sale marketable securities:
Corporate and asset-backed debt securities	$	43	$	48
Foreign government debt securities	1		2
United States agency debt securities	2		5
United States Treasury debt securities	30		19
Certificates of deposit	1		1
Total available-for-sale marketable securities	$	77	$	75
Foreign currency exchange forward contracts	373		212
Level 2 - Assets	$	450	$	287
Total assets measured at fair value	$	2,025	$	3,424

Liabilities Measured at Fair Value	September		December
	2022		2021
Deferred compensation arrangements	$	155	$	193
Level 1 - Liabilities	$	155	$	193
Foreign currency exchange forward contracts	$	18	$	17
Level 2 - Liabilities	$	18	$	17
Contingent consideration:
Beginning	$	306	$	393
Additions	1		62
Change in estimate	(137)		(1)
Settlements	(47)		(148)
Ending	$	123	$	306
Level 3 - Liabilities	$	123	$	306
Total liabilities measured at fair value	$	296	$	516

Fair Value of Available for Sale Securities by Maturity
	September 2022		December 2021
Due in one year or less	$	50	$	36
Due after one year through three years	$	27	$	39

On September 30, 2022 and December 31, 2021 the aggregate difference between the cost and fair value of available-for-sale marketable securities was nominal. Interest and marketable securities income was $26 and $15 in the three months and $61 and $50 in the nine months 2022 and 2021, which was recorded in other income (expense), net.

Our investments in available-for-sale marketable securities had a minimum credit quality rating of A2 (Moody's), A (Standard & Poor's) and A (Fitch). We do not plan to sell the investments, and it is not more likely than not that we will be required to sell the investments before recovery of their amortized cost basis, which may be maturity.

NOTE 6 - CONTINGENCIES AND COMMITMENTS

We are involved in various ongoing proceedings, legal actions and claims arising in the normal course of business, including proceedings related to product, labor, intellectual property and other matters, the most significant of which are more fully described below. The outcomes of these matters will generally not be known for prolonged periods of time. In certain of the legal proceedings the claimants seek damages as well as other compensatory and equitable relief that could result in the payment of significant claims and settlements and/or the imposition of injunctions or other equitable relief. For legal matters for which management had sufficient information to reasonably estimate our future obligations, a liability representing management's best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within the range is not known, is recorded. The estimates are based on consultation with legal counsel, previous settlement experience and settlement strategies. If actual outcomes are less favorable than those estimated by management, additional expense may be incurred, which could unfavorably affect future operating results. We are self-insured for certain claims and expenses. The ultimate cost to us with respect to product liability claims could be materially different than the amount of the current estimates and accruals and could have a material adverse effect on our financial position, results of operations and cash flows.

In April 2022 the United States District Court for the District of Delaware issued a judgment following a jury verdict in favor of PureWick Corporation (PureWick) for its 2019 complaint seeking patent infringement damages related to our PrimaFit and PrimoFit products. The court awarded damages and we recorded charges of $28 in March 2022. In June 2022 PureWick filed a motion to seek enhancement of the judgment and if successful, the judgment could total approximately $100 and include an

Dollar amounts are in millions except per share amounts or as otherwise specified. 7

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

injunction against future sales. We intend to appeal the outcome of this case.

Recall Matters

In June 2012 we voluntarily recalled our Rejuvenate and ABG II Modular-Neck hip stems and terminated global distribution of these hip products. Product liability lawsuits relating to this voluntary recall have been filed against us. In November 2014 we entered into a settlement agreement to compensate eligible United States patients who had revision surgery prior to November 3, 2014 and in December 2016 the settlement program was extended to patients who had revision surgery prior to December 19, 2016. In September 2020 we entered into a second settlement agreement to compensate eligible United States patients who had revision surgery prior to September 9, 2020. There are remaining lawsuits that we will continue to defend against.

In August 2016 and May 2018 we voluntarily recalled certain lot-specific sizes and offsets of LFIT Anatomic CoCr V40 Femoral Heads. Product liability lawsuits and claims relating to this voluntary recall have been filed against us. In November 2018 we entered into a settlement agreement to resolve a significant number of claims and lawsuits related to the recalls. In April 2022 we executed a second agreement to resolve a significant number of claims and lawsuits related to the recalls. The specific terms of the settlement agreement, including the financial terms, are confidential.

With the acquisition of Wright Medical Group N.V. (Wright) in November 2020, we are responsible for certain product liability claims, primarily related to certain hip products sold by Wright prior to its 2014 divestiture of the OrthoRecon business. We will continue to evaluate each claim and the possible loss we may incur.

We have incurred, and expect to incur in the future, costs associated with the defense and settlement of these matters. For the nine months 2022 we have recorded charges of $14 primarily related to Wright hip products and made payments of $26 primarily related to Rejuvenate and ABG II Modular-Neck hip stems. Based on the information that has been received, we have estimated the remaining range of probable loss related to recall matters globally to be approximately $375 to $510. We have recorded reserves representing the remaining minimum of the range of probable loss. The final outcomes of these matters are dependent on many factors that are difficult to predict. Accordingly the ultimate cost related to these matters may be materially different than the amount of our current estimate and accruals and could have a material adverse effect on our results of operations and cash flows.

Leases	September			December
	2022			2021
Right-of-use assets	$	456		$	419
Lease liabilities, current	$	116		$	112
Lease liabilities, non-current	$	349		$	310
Other information:
Weighted-average remaining lease term	5.5 years			5.4 years
Weighted-average discount rate	3.09		%	2.86		%

	Three Months				Nine Months
	2022		2021		2022		2021
Operating lease cost	$	37	$	35	$	110	$	102

NOTE 7 - ACQUISITIONS

We acquire stock in companies and various assets that continue to support our capital deployment and product development strategies. The aggregate purchase price of our acquisitions, net of cash acquired was $2,563 and $267 in the nine months 2022 and 2021.

In February 2022 we completed the acquisition of Vocera Communications, Inc. (Vocera) for $79.25 per share, or an aggregate purchase price of $2.6 billion, net of cash acquired ($3.0 billion including convertible notes). Vocera is a leader in the digital care coordination and communication category. Vocera is part of our Medical business within MedSurg and Neurotechnology. Goodwill attributable to the acquisition reflects the strategic benefits of expanding our presence in adjacent markets, diversifying our product portfolio, advancing innovations, and accelerating our digital aspirations. This goodwill is not deductible for tax purposes.

In the nine months 2022 note holders elected to redeem the 1.50% and 0.50% convertible notes assumed in the Vocera acquisition for $101 and $324. These repayments are classified as financing activities in the Consolidated Statements of Cash Flows.

Share-based awards for Vocera employees vested upon our acquisition and a charge of $132 was recorded in selling, general and administrative expenses in 2022.

Purchase price allocations for our significant acquisitions are:

Purchase Price Allocation of Acquired Net Assets
2022	Vocera
Tangible assets and liabilities:
Accounts receivable	$	33
Inventory	13
Deferred income tax assets	73
Other assets	92
Debt	(425)
Deferred income tax liabilities	(182)
Other liabilities	(115)
Intangible assets:
Customer and distributor relationships	550
Developed technology and patents	178
Trade name	18
Goodwill	2,328
Purchase price, net of cash acquired of $281	$	2,563
Weighted-average life of intangible assets	13

Purchase price allocations for Vocera were based on preliminary valuations, primarily related to intangible assets and deferred income taxes. Our estimates and assumptions are subject to change within the measurement period.

Consolidated Estimated Amortization Expense
Remainder of 2022		2023		2024		2025		2026
$	159	$	617	$	587	$	567	$	510

NOTE 8 - DEBT AND CREDIT FACILITIES

We have lines of credit issued by various financial institutions that are available to fund our day-to-day operating needs. Certain of our credit facilities require us to comply with financial and other covenants. We were in compliance with all covenants on September 30, 2022.

In February 2022 we entered into a $1.5 billion term loan agreement that matures on February 22, 2025 and bears interest at a base rate based on the Term Secured Overnight Financing Rate (SOFR) plus 0.725%. In the nine months 2022 we repaid $500 on the term loan.

Dollar amounts are in millions except per share amounts or as otherwise specified. 8

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

In 2022 our Board of Directors approved an increase to the maximum amount of commercial paper that can be outstanding from $1,500 to $2,250.

On September 30, 2022 there were no borrowings outstanding under our credit facility or commercial paper program which allows for maturities up to 397 days from the date of issuance.

Summary of Total Debt			September 2022		December 2021
	Rate	Due
Senior unsecured notes:
	1.125%	November 30, 2023	$	530	$	622
	0.600%	December 1, 2023	599		598
	3.375%	May 15, 2024	595		593
	0.250%	December 3, 2024	817		958
	1.150%	June 15, 2025	647		645
	3.375%	November 1, 2025	748		748
	3.500%	March 15, 2026	995		994
	2.125%	November 30, 2027	720		845
	3.650%	March 7, 2028	597		597
	0.750%	March 1, 2029	767		901
	1.950%	June 15, 2030	991		990
	2.625%	November 30, 2030	619		727
	1.000%	December 3, 2031	715		840
	4.100%	April 1, 2043	392		392
	4.375%	May 15, 2044	395		395
	4.625%	March 15, 2046	982		982
	2.900%	June 15, 2050	642		642
Term loan		February 22, 2025	1,000		—
Other			8		10
Total debt			$	12,759	$	12,479
Less current maturities of debt			8		7
Total long-term debt			$	12,751	$	12,472
			September 2022		December 2021
Unamortized debt issuance costs			$	55	$	62
Borrowing capacity on existing facilities			$	2,162	$	2,162
Fair value of senior unsecured notes			$	10,401	$	13,391

The fair value of the senior unsecured notes was estimated using quoted interest rates, maturities and amounts of borrowings based on quoted active market prices and yields that took into account the underlying terms of the debt instruments. Substantially all of our debt is classified within Level 2 of the fair value hierarchy.

NOTE 9 - INCOME TAXES

Our effective tax rates were 0.0% and 6.6% in the three and nine months 2022. In the three months 2022 income tax expense decreased $162 due to the effective settlement of the United States federal income tax audit for years 2014 through 2018. In addition, other income (expense), net includes a benefit of $50 related to the release of accrued interest associated with this settlement. The nine months 2022 additionally include the reversal of deferred income tax on undistributed earnings of foreign subsidiaries no longer determined to be indefinitely reinvested. Our effective tax rates of 11.5% and 12.6% in the three and nine months 2021 include certain discrete tax items.

NOTE 10 - SEGMENT INFORMATION

As previously disclosed, effective December 31, 2021 we changed our reportable business segments to (i) MedSurg and Neurotechnology and (ii) Orthopaedics and Spine to align to our new internal reporting structure. We have reflected these changes in all historical periods presented.

	Three Months				Nine Months
	2022		2021		2022		2021
MedSurg and Neurotechnology	$	2,588	$	2,349	$	7,560	$	6,899
Orthopaedics and Spine	1,891		1,811		5,687		5,508
Net sales	$	4,479	$	4,160	$	13,247	$	12,407
MedSurg and Neurotechnology	$	626	$	663	$	1,838	$	2,000
Orthopaedics and Spine	519		500		1,648		1,518
Segment operating income	$	1,145	$	1,163	$	3,486	$	3,518
Items not allocated to segments:
Corporate and other	$	(144)	$	(105)	$	(488)	$	(421)
Acquisition and integration-related costs	78		(126)		(108)		(495)
Amortization of intangible assets	(159)		(144)		(469)		(474)
Restructuring-related and other charges	(58)		(178)		(229)		(209)
Medical device regulations	(38)		(27)		(98)		(72)
Recall-related matters	4		(16)		(14)		(98)
Regulatory and legal matters	(20)		7		(53)		16
Consolidated operating income	$	808	$	574	$	2,027	$	1,765

There were no significant changes to total assets by segment from information provided in our Annual Report on Form 10-K for 2021, other than the addition of the assets acquired in the Vocera acquisition which are included in the MedSurg and Neurotechnology segment.

NOTE 11 - ASSET IMPAIRMENTS

The government in China has launched regional and national programs for volume-based procurement ("VBP") of high-value medical consumables to reduce healthcare costs. Each VBP program has specific requirements to award contracts to the lowest bidders who are able to satisfy the quality and quantity requirements. The successful bidders may be guaranteed sales volume for certain products, while unsuccessful bidders may lose unit sales volume. The prices required for a successful bid have negatively impacted our existing commercial operations of joint replacement and trauma products in China.

As a result of the outcome of certain regional programs for our trauma products and the national VBP program for hips and knees we recorded charges of $105 to impair certain long-lived and intangible assets in the third quarter of 2021. These charges were included in selling, general and administrative expenses. The national VBP program for spine products took place in the third quarter of 2022 and we were unsuccessful in our bid. As a result we are exiting the spine business in China. Asset impairments recorded in the three months 2022 were not significant. Our total business in China represented approximately 2.5% of our revenues for the nine months 2022.

Dollar amounts are in millions except per share amounts or as otherwise specified. 9

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

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

ABOUT STRYKER

Stryker is one of the world's leading medical technology companies and, together with our customers, we are driven to make healthcare better. We offer innovative products and services in Medical and Surgical, Neurotechnology, Orthopaedics and Spine that help improve patient and hospital outcomes. Alongside its customers around the world, Stryker impacts more than 100 million patients annually.

We segregate our operations into two reportable business segments: (i) MedSurg and Neurotechnology and (ii) Orthopaedics and Spine. MedSurg and Neurotechnology products include surgical equipment and navigation systems (Instruments), endoscopic and communications systems (Endoscopy), patient handling, emergency medical equipment and intensive care disposable products (Medical), minimally invasive products for the treatment of acute ischemic and hemorrhagic stroke (Neurovascular), a comprehensive line of products for traditional brain and open skull based surgical procedures; orthobiologic and biosurgery products, including synthetic bone grafts and vertebral augmentation products (Neuro Cranial) and other medical device products used in a variety of medical specialties. Orthopaedics and Spine products consist primarily of implants used in hip and knee joint replacements and trauma and extremity surgeries, and cervical, thoracolumbar and interbody systems used in spinal injury, deformity and degenerative therapies.

Macroeconomic Environment

The global economy is experiencing increased inflationary pressures in part due to global supply chain disruptions, labor shortages and other impacts of the COVID-19 pandemic and current macroeconomic environment which we anticipate will continue. Higher interest rates and capital costs, higher shipping costs, increased costs of labor and weakening foreign currency exchange rates are creating additional economic challenges. We expect these conditions to cause our customers to decrease or delay orders for our products and services, and the higher interest rates to impact demand for our capital products.

Our operations have been adversely impacted by the inflationary pressures primarily related to labor, steel and transportation costs as well as the impact of purchasing electronic components at premium prices on the spot market. Sales growth in certain products has been constrained by the continuing supply chain challenges and electronic component shortages, especially impacting the capital products in our MedSurg businesses.

Russia and Ukraine Conflict

The military conflict in Russia and Ukraine and the sanctions imposed by the United States government and other nations in response to this conflict have caused significant volatility and disruptions to the global markets. Given that we provide life-saving and life-enhancing products, we plan to continue operating in Russia provided we can safely do so. During the nine months 2022 net sales in Russia were approximately 0.3% of our revenues. Although Russia does not constitute a material portion of our business, there is uncertainty around the impact it will have on the global economy, supply chains and fuel and energy prices generally, and therefore our business. Refer to Part II, Item 1A. "Risk Factors" in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 for further details.

China Volume-Based Procurement and Import Purchase Evaluation

The government in China has launched regional and national programs for volume-based procurement ("VBP") of high-value medical consumables to reduce healthcare costs. Each VBP program has specific requirements to award contracts to the lowest bidders who are able to satisfy the quality and quantity requirements. The successful bidders may be guaranteed sales volume for certain products, while unsuccessful bidders may lose unit sales volume. The prices required for a successful bid have negatively impacted our existing commercial operations of joint replacement and trauma products in China. The national VBP program for spine products took place in the third quarter of 2022 and we were unsuccessful in our bid. As a result we are exiting the spine business in China. We expect regional VBP programs to be initiated for neurovascular products in the fourth quarter of 2022 and additional VBP programs may be initiated in the future. China has also issued national guiding standards for Import Purchase Evaluation which has increased the purchase of locally sourced equipment in China's public hospitals and is impacting our MedSurg business in China. Our business in China represented approximately 2.5% of our revenues for the nine months 2022.

Overview of the Three and Nine Months

In the three months 2022 we achieved sales growth of 7.7% from 2021. Excluding the impact of acquisitions and divestitures sales grew 9.9% in constant currency. We reported operating income margin of 18.0%, net earnings of $816 and net earnings per diluted share of $2.14. Excluding the impact of certain items, adjusted operating income margin(1) contracted by 310 basis points to 22.3%, with adjusted net earnings(1) of $810 and adjusted net earnings per diluted share(1) of $2.12, a decrease of 3.6% from 2021.

In the nine months 2022 we achieved sales growth of 6.8% from 2021. Excluding the impact of acquisitions and divestitures sales grew 8.3% in constant currency. We reported operating income margin of 15.3%, net earnings of $1,795 and net earnings per diluted share of $4.70. Excluding the impact of certain items, adjusted operating income margin(1) contracted by 240 basis points to 22.6%, with adjusted net earnings(1) of $2,422 and adjusted net earnings per diluted share(1) of $6.34, a decrease of 0.6% from 2021.

Recent Developments

In February 2022 we entered into a $1.5 billion term loan agreement that matures on February 22, 2025 and bears interest at a base rate based on the Term Secured Overnight Financing Rate (SOFR) plus 0.725%. In June and September 2022 we repaid $250 and $250 of this term loan.

In February 2022 we completed the acquisition of Vocera Communications, Inc. (Vocera) for $79.25 per share, or an aggregate purchase price of $2.6 billion, net of cash acquired ($3.0 billion including convertible notes). Vocera is a leader in the digital care coordination and communication category. Vocera is part of our Medical business within MedSurg and Neurotechnology. Goodwill attributable to the acquisition reflects the strategic benefits of expanding our presence in adjacent markets, diversifying our product portfolio, advancing innovations, and accelerating our digital aspirations. Refer to Note 7 to our Consolidated Financial Statements for further information.

Dollar amounts are in millions except per share amounts or as otherwise specified. 10

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

On August 16, 2022 the Inflation Reduction Act (“IRA”) was enacted into law. The IRA includes a 15% corporate alternative minimum tax effective in 2023 and a 1% tax on share repurchases after December 31, 2022. We are currently evaluating the impact of the IRA and do not expect the tax-related provisions to have a material impact on our Consolidated Financial Statements. The impact of the excise tax on share repurchases will be dependent on the extent of share repurchases made in future periods.

(1) Refer to "Non-GAAP Financial Measures" for a discussion of non-GAAP financial measures used in this report and a reconciliation to the most directly comparable GAAP financial measure.

CONSOLIDATED RESULTS OF OPERATIONS
	Three Months										Nine Months
					Percent Net Sales				Percentage						Percent Net Sales				Percentage
	2022		2021		2022		2021		Change		2022		2021		2022		2021		Change
Net sales	$	4,479	$	4,160	100.0	%	100.0	%	7.7	%	$	13,247	$	12,407	100.0	%	100.0	%	6.8	%
Gross profit	2,782		2,642		62.1		63.5		5.3		8,342		7,923		63.0		63.9		5.3
Research, development and engineering expenses	364		306		8.1		7.4		19.0		1,128		904		8.5		7.3		24.8
Selling, general and administrative expenses	1,455		1,602		32.5		38.5		(9.2)		4,704		4,682		35.5		37.7		0.5
Recall charges	(4)		16		(0.1)		0.4		nm		14		98		0.1		0.8		nm
Amortization of intangible assets	159		144		3.5		3.5		10.4		469		474		3.5		3.8		(1.1)
Other income (expense), net	8		(79)		0.2		(1.9)		nm		(105)		(241)		(0.8)		(1.9)		(56.4)
Income taxes	—		57		nm		nm		(100.0)		127		192		nm		nm		(33.9)
Net earnings	$	816	$	438	18.2	%	10.5	%	86.3	%	$	1,795	$	1,332	13.6	%	10.7	%	34.8	%
Net earnings per diluted share	$	2.14	$	1.14					87.7	%	$	4.70	$	3.48					35.1	%
Adjusted net earnings per diluted share(1)	$	2.12	$	2.20					(3.6)	%	$	6.34	$	6.38					(0.6)	%

nm - not meaningful

Geographic and Segment Net Sales	Three Months								Nine Months
					Percentage Change								Percentage Change
	2022		2021		As Reported		Constant Currency		2022		2021		As Reported		Constant Currency
Geographic:
United States	$	3,360	$	3,019	11.3	%	11.3	%	$	9,776	$	8,903	9.8	%	9.8	%
International	1,119		1,141		(1.9)		11.7		3,471		3,504		(0.9)		9.1
Total	$	4,479	$	4,160	7.7	%	11.4	%	$	13,247	$	12,407	6.8	%	9.6	%
Segment:
MedSurg and Neurotechnology	$	2,588	$	2,349	10.2	%	13.5	%	$	7,560	$	6,899	9.6	%	12.1	%
Orthopaedics and Spine	1,891		1,811		4.4		8.7		5,687		5,508		3.2		6.5
Total	$	4,479	$	4,160	7.7	%	11.4	%	$	13,247	$	12,407	6.8	%	9.6	%

Supplemental Net Sales Growth Information
	Three Months														Nine Months
					Percentage Change														Percentage Change
									United States		International												United States		International
	2022		2021		As Reported		Constant Currency		As Reported		As Reported		Constant Currency		2022		2021		As Reported		Constant Currency		As Reported		As Reported		Constant Currency
MedSurg and Neurotechnology:
Instruments	$	535	$	525	1.8	%	4.8	%	2.3	%	—	%	14.4	%	$	1,626	$	1,511	7.6	%	9.9	%	10.1	%	(1.0)	%	9.4	%
Endoscopy	590		525		12.4		14.9		14.8		3.1		15.6		1,728		1,512		14.3		16.6		16.3		7.2		17.8
Medical	765		636		20.1		22.9		25.8		—		12.7		2,095		1,898		10.4		12.4		15.7		(7.3)		1.2
Neurovascular	294		295		(0.3)		7.6		(2.0)		0.7		13.6		901		885		1.7		7.1		(1.7)		3.8		12.7
Neuro Cranial	332		299		11.3		13.9		12.7		5.0		19.6		992		890		11.5		13.4		13.2		4.2		14.3
Other	72		69		5.9		6.0		5.8		12.9		16.4		218		203		7.8		7.8		7.3		42.1		45.2
	$	2,588	$	2,349	10.2	%	13.5	%	13.2	%	1.3	%	14.4	%	$	7,560	$	6,899	9.6	%	12.1	%	12.7	%	1.0	%	10.4	%
Orthopaedics and Spine:
Knees	$	481	$	439	9.6	%	13.4	%	13.7	%	(1.7)	%	12.3	%	$	1,445	$	1,325	9.1	%	12.1	%	11.8	%	1.6	%	12.8	%
Hips	347		328		5.6		11.3		12.4		(5.0)		9.6		1,038		990		4.8		9.2		8.3		(0.7)		10.5
Trauma and Extremities	672		639		5.1		9.5		10.4		(7.1)		7.3		2,033		1,953		4.1		7.2		7.9		(4.8)		5.6
Spine	280		282		(1.0)		2.6		2.0		(8.7)		3.9		849		867		(2.1)		0.6		0.6		(8.5)		0.7
Other	111		123		(9.2)		(5.6)		(11.2)		(1.7)		15.5		322		373		(13.4)		(10.6)		(16.0)		(4.3)		9.0
	$	1,891	$	1,811	4.4	%	8.7	%	8.6	%	(5.4)	%	8.8	%	$	5,687	$	5,508	3.2	%	6.5	%	6.0	%	(3.0)	%	7.7	%
Total	$	4,479	$	4,160	7.7	%	11.4	%	11.3	%	(1.9)	%	11.7	%	$	13,247	$	12,407	6.8	%	9.6	%	9.8	%	(0.9)	%	9.1	%

Dollar amounts are in millions except per share amounts or as otherwise specified. 11

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

Consolidated Net Sales

Consolidated net sales increased 7.7% in the three months 2022 as reported and 11.4% in constant currency, as foreign currency exchange rates negatively impacted net sales by 3.7%. Excluding the 1.5% impact of acquisitions and divestitures, net sales in constant currency increased by 10.6% from increased unit volume partially offset by 0.7% due to lower prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology products and most Orthopaedics and Spine products.

Consolidated net sales increased 6.8% in the nine months 2022 as reported and 9.6% in constant currency, as foreign currency exchange rates negatively impacted net sales by 2.8%. Excluding the 1.3% impact of acquisitions and divestitures, net sales in constant currency increased by 9.4% from increased unit volume partially offset by 1.1% due to lower prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology products and most Orthopaedics and Spine products.

MedSurg and Neurotechnology Net Sales

MedSurg and Neurotechnology net sales increased 10.2% in the three months 2022 as reported and 13.5% in constant currency, as foreign currency exchange rates negatively impacted net sales by 3.3%. Excluding the 2.7% impact of acquisitions and divestitures, net sales in constant currency increased by 9.8% from increased unit volume and 1.0% from higher prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology products.

MedSurg and Neurotechnology net sales increased 9.6% in the nine months 2022 as reported and 12.1% in constant currency, as foreign currency exchange rates negatively impacted net sales by 2.5%. Excluding the 2.3% impact of acquisitions and divestitures, net sales in constant currency increased by 9.5% from increased unit volume and 0.3% from higher prices. The unit volume increase was due to higher shipments across all MedSurg products.

Orthopaedics and Spine Net Sales

Orthopaedics and Spine net sales increased 4.4% in the three months 2022 as reported and 8.7% in constant currency, as foreign currency exchange rates negatively impacted net sales by 4.3%. Net sales in constant currency increased 11.6% from increased unit volume partially offset by 2.9% from lower prices. The unit volume increase was due to higher shipments across most Orthopaedics and Spine products.

Orthopaedics and Spine net sales increased 3.2% in the nine months 2022 as reported and 6.5% in constant currency, as foreign currency exchange rates negatively impacted net sales by 3.3%. Net sales in constant currency increased 9.3% from increased unit volume partially offset by 2.8% from lower prices. The unit volume increase was due to higher shipments across most Orthopaedics and Spine products.

Gross Profit

Gross profit as a percentage of sales in the three months 2022 decreased to 62.1% from 63.5% in 2021. Excluding the impact of the items noted below, gross profit decreased to 62.6% of sales in the three months 2022 from 66.3% in 2021 due to increased costs from purchases of electronic components at premium prices on the spot market and other inflationary pressures, primarily related to labor, steel and transportation, as well as inefficiencies from supply chain disruptions.

Gross profit as a percentage of sales in the nine months 2022 decreased to 63.0% from 63.9% in 2021. Excluding the impact of the items noted below, gross profit decreased to 63.3% of sales in the nine months 2022 from 65.9% in 2021 primarily due to increased costs from purchases of electronic components at premium prices on the spot market and other inflationary pressures, primarily related to labor, steel and transportation, as well as inefficiencies from supply chain disruptions.

					Percent Net Sales
Three Months	2022		2021		2022		2021
Reported	$	2,782	$	2,642	62.1	%	63.5	%
Inventory stepped-up to fair value	—		94		—		2.3
Restructuring-related and other charges	19		20		0.5		0.5
Medical device regulations	1		1		—		—
Adjusted	$	2,802	$	2,757	62.6	%	66.3	%

					Percent Net Sales
Nine Months	2022		2021		2022		2021
Reported	$	8,342	$	7,923	63.0	%	63.9	%
Inventory stepped-up to fair value	12		231		0.1		1.9
Restructuring-related and other charges	29		20		0.2		0.1
Medical device regulations	3		2		—		—
Adjusted	$	8,386	$	8,176	63.3	%	65.9	%

Research, Development and Engineering Expenses

Research, development and engineering expenses increased $58 or 19.0% in the three months 2022 and increased as a percentage of sales to 8.1% from 7.4% in 2021. Excluding the impact of the items noted below, expenses increased to 7.1% of sales in 2022 from 6.7% in 2021.

Research, development and engineering expenses increased $224 or 24.8% in the nine months 2022 and increased as a percentage of sales to 8.5% from 7.3% in 2021. Excluding the impact of the items noted below, expenses increased to 7.1% of sales in 2022 from 6.7% in 2021.

The increases for the three and nine months reflect our continued investment in innovation, integration of recent acquisitions and for the nine months the write-off of certain intangible assets.

					Percent Net Sales
Three Months	2022		2021		2022		2021
Reported	$	364	$	306	8.1	%	7.4	%
Restructuring-related and other charges	(8)		—		(0.2)		—
Medical device regulations	(39)		(26)		(0.8)		(0.7)
Adjusted	$	317	$	280	7.1	%	6.7	%

					Percent Net Sales
Nine Months	2022		2021		2022		2021
Reported	$	1,128	$	904	8.5	%	7.3	%
Restructuring-related and other charges	(87)		—		(0.7)		—
Medical device regulations	(95)		(70)		(0.7)		(0.6)
Adjusted	$	946	$	834	7.1	%	6.7	%

Selling, General and Administrative Expenses

Selling, general and administrative expenses decreased $147 or 9.2% in the three months 2022 and decreased as a percentage of sales to 32.5% from 38.5% in 2021. During the three months 2022 we determined that certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded $110 to reduce the fair value of contingent consideration as well as $8 in research, development and engineering expenses to write off the related in-process research and development intangible asset. Excluding the impact of the items noted below, expenses decreased to 33.1% of sales in 2022 from 34.1% in 2021.

Dollar amounts are in millions except per share amounts or as otherwise specified. 12

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

Selling, general and administrative expenses increased $22 or 0.5% in the nine months 2022 and decreased as a percentage of sales to 35.5% from 37.7%. Share-based awards for Vocera employees vested upon our acquisition in 2022 and a charge of $132 was recorded. Excluding the impact of the items noted below, expenses decreased to 33.5% of sales in 2022 from 34.2% in 2021.

The decreases as a percentage of sales for the three and nine months were due to fixed cost leverage and continued cost discipline.

					Percent Net Sales
Three Months	2022		2021		2022		2021
Reported	$	1,455	$	1,602	32.5	%	38.5	%
Other acquisition and integration-related	78		(32)		1.7		(0.8)
Restructuring-related and other charges	(31)		(158)		(0.7)		(3.8)
Medical device regulations	2		—		—		—
Regulatory and legal matters	(20)		7		(0.4)		0.2
Adjusted	$	1,484	$	1,419	33.1	%	34.1	%

					Percent Net Sales
Nine Months	2022		2021		2022		2021
Reported	$	4,704	$	4,682	35.5	%	37.7	%
Other acquisition and integration-related	(96)		(264)		(0.7)		(2.1)
Restructuring-related and other charges	(113)		(189)		(0.9)		(1.5)
Regulatory and legal matters	(53)		16		(0.4)		0.1
Adjusted	$	4,442	$	4,245	33.5	%	34.2	%

Recall Charges

Recall charges were minimal in the three and nine months 2022 and the three months 2021. Charges of $98 in the nine months 2021 were primarily related to Rejuvenate and ABG II Modular-Neck hip stems. Refer to Note 6 to our Consolidated Financial Statements for further information.

Amortization of Intangible Assets

Amortization of intangible assets was $159 and $144 in the three months and $469 and $474 in the nine months 2022 and 2021. Refer to Note 7 to our Consolidated Financial Statements for further information.

Operating Income

Operating income increased $234 to 18.0% of sales in the three months 2022 from 13.8% of sales in 2021. Excluding the impact of the items noted below, operating income decreased to 22.3% of sales in 2022 from 25.4% in 2021 primarily due to higher costs from inflationary pressures, slightly lower selling price, unfavorable foreign currency and our continued investments in innovation, partially offset by leverage from higher sales volumes and cost discipline.

Operating income increased $262 or 14.8% to 15.3% of sales in the nine months 2022 from 14.2% of sales in 2021. Excluding the impact of the items noted below, operating income decreased to 22.6% of sales in 2022 from 25.0% in 2021 primarily due to higher costs from inflationary pressures, slightly lower selling price, unfavorable foreign currency and our continued investments in innovation, partially offset by leverage from higher sales and cost discipline.

					Percent Net Sales
Three Months	2022		2021		2022		2021
Reported	$	808	$	574	18.0	%	13.8	%
Inventory stepped-up to fair value	—		94		—		2.3
Other acquisition and integration-related	(78)		32		(1.7)		0.8
Amortization of purchased intangible assets	159		144		3.5		3.5
Restructuring-related and other charges	58		178		1.4		4.2
Medical device regulations	38		27		0.8		0.6
Recall-related matters	(4)		16		(0.1)		0.4
Regulatory and legal matters	20		(7)		0.4		(0.2)
Adjusted	$	1,001	$	1,058	22.3	%	25.4	%

					Percent Net Sales
Nine Months	2022		2021		2022		2021
Reported	$	2,027	$	1,765	15.3	%	14.2	%
Inventory stepped-up to fair value	12		231		0.1		1.9
Other acquisition and integration-related	96		264		0.7		2.1
Amortization of purchased intangible assets	469		474		3.5		3.8
Restructuring-related and other charges	229		209		1.8		1.7
Medical device regulations	98		72		0.7		0.6
Recall-related matters	14		98		0.1		0.8
Regulatory and legal matters	53		(16)		0.4		(0.1)
Adjusted	$	2,998	$	3,097	22.6	%	25.0	%

Other Income (Expense), Net

Other income (expense), net was $8 and ($79) in the three months and ($105) and ($241) in the nine months 2022 and 2021. The decrease in net expense in 2022 was primarily due to favorable investment returns and the reversal of accrued interest related to the effective settlement of the United States federal income tax audit for years 2014 through 2018. Refer to Note 9 to our Consolidated Financial Statements for further information.

Income Taxes

Our effective tax rates were 0.0% and 6.6% in the three and nine months 2022. In the three months 2022 income tax expense decreased $162 due to the effective settlement of the United States federal income tax audit for years 2014 through 2018. In addition, other income (expense), net includes a benefit of $50 related to the release of accrued interest associated with this settlement. The nine months 2022 additionally include the reversal of deferred income tax on undistributed earnings of foreign subsidiaries no longer determined to be indefinitely reinvested. Our effective tax rates of 11.5% and 12.6% in the three and nine months 2021 include certain discrete tax items.

Net Earnings

Net earnings increased to $816 or $2.14 per diluted share in the three months 2022 from $438 or $1.14 per diluted share in 2021. Adjusted net earnings per diluted share(1) was $2.12 in 2022, a decrease of 3.6% from 2021.

Net earnings increased to $1,795 or $4.70 per diluted share in the nine months 2022 from $1,332 or $3.48 per diluted share in 2021. Adjusted net earnings per diluted share(1) decreased 0.6% to $6.34 in 2022 from $6.38 in 2021.

					Percent Net Sales
Three Months	2022		2021		2022		2021
Reported	$	816	$	438	18.2	%	10.5	%
Inventory stepped-up to fair value	—		73		—		1.8
Other acquisition and integration-related	(82)		24		(1.8)		0.6
Amortization of purchased intangible assets	132		114		2.9		2.7
Restructuring-related and other charges	50		165		1.1		3.9
Medical device regulations	32		23		0.7		0.6
Recall-related matters	(4)		12		(0.1)		0.3
Regulatory and legal matters	15		(7)		0.3		(0.2)
Tax matters	(149)		—		(3.2)		—
Adjusted	$	810	$	842	18.1	%	20.2	%

					Percent Net Sales
Nine Months	2022		2021		2022		2021
Reported	$	1,795	$	1,332	13.6	%	10.7	%
Inventory stepped-up to fair value	9		176		0.1		1.4
Other acquisition and integration-related	46		204		0.3		1.6
Amortization of purchased intangible assets	371		378		2.8		3.1
Restructuring-related and other charges	190		198		1.4		1.7
Medical device regulations	82		60		0.6		0.5
Recall-related matters	10		85		0.1		0.7
Regulatory and legal matters	39		(19)		0.3		(0.2)
Tax matters	(120)		26		(0.9)		0.2
Adjusted	$	2,422	$	2,440	18.3	%	19.7	%

Dollar amounts are in millions except per share amounts or as otherwise specified. 13

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

Non-GAAP Financial Measures

We supplement the reporting of our financial information determined under accounting principles generally accepted in the United States (GAAP) with certain non-GAAP financial measures, including percentage sales growth in constant currency; percentage organic sales growth; adjusted gross profit; adjusted selling, general and administrative expenses; adjusted research, development and engineering expenses; adjusted operating income; adjusted other income (expense), net; adjusted effective income tax rate; adjusted net earnings; adjusted net earnings per diluted share (Diluted EPS); free cash flow; and free cash flow conversion. We believe these non-GAAP financial measures provide meaningful information to assist investors and shareholders in understanding our financial results and assessing our prospects for future performance. Management believes percentage sales growth in constant currency and the other adjusted measures described above are important indicators of our operations because they exclude items that may not be indicative of or are unrelated to our core operating results and provide a baseline for analyzing trends in our underlying businesses. Management uses these non-GAAP financial measures for reviewing the operating results of reportable business segments and analyzing potential future business trends in connection with our budget process and bases certain management incentive compensation on these non-GAAP financial measures. To measure percentage sales growth in constant currency, we remove the impact of changes in foreign currency exchange rates that affect the comparability and trend of sales. Percentage sales growth in constant currency is calculated by translating current and prior year results at the same foreign currency exchange rate. To measure percentage organic sales growth, we remove the impact of changes in foreign currency exchange rates, acquisitions and divestitures, which affect the comparability and trend of sales. Percentage organic sales growth is calculated by translating current year and prior year results at the same foreign currency exchange rates excluding the impact of acquisitions and divestitures. To measure earnings performance on a consistent and comparable basis, we exclude certain items that affect the comparability of operating results and the trend of earnings. To measure free cash flow, we adjust cash provided by operating activities by the amount of purchases of property, plant and equipment and proceeds from long-lived asset disposals and remove the impact of certain legal settlements and recall payments. To measure free cash flow conversion we divide free cash flow by adjusted net earnings. These adjustments are irregular in timing and may not be indicative of our past and future performance. The following are examples of the types of adjustments that may be included in a period:

1.Acquisition and integration-related costs. Costs related to integrating recently acquired businesses (e.g., costs associated with the termination of sales relationships, workforce reductions and other integration-related activities), changes in the fair value of contingent consideration and specific costs (e.g., inventory step-up and deal costs) related to the consummation of the acquisition process.

2.Amortization of purchased intangible assets. Periodic amortization expense related to purchased intangible assets.

3.Restructuring-related and other charges. Costs associated with the termination of sales relationships in certain countries, workforce reductions, elimination of product lines, certain long-lived and intangible asset write-offs and impairments and associated costs and other restructuring-related activities.

4.Medical device regulations. Costs specific to updating our quality system, product labeling, asset write-offs and product remanufacturing to comply with the new medical device reporting regulations and other requirements of the European Union.

5.Recall-related matters. Our best estimate of the minimum of the range of probable loss to resolve the Rejuvenate, LFIT V40 and other product recalls.

6.Regulatory and legal matters. Our best estimate of the minimum of the range of probable loss to resolve certain regulatory matters and other legal settlements.

7.Tax matters. Charges represent the impact of accounting for certain significant and discrete tax items.

Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. These adjusted financial measures should not be considered in isolation or as a substitute for reported sales growth, gross profit, selling, general and administrative expenses, research, development and engineering expenses, operating income, other income (expense), net, effective income tax rate, net earnings and net earnings per diluted share, the most directly comparable GAAP financial measures. These non-GAAP financial measures are an additional way of viewing aspects of our operations when viewed with our GAAP results and the reconciliations to corresponding GAAP financial measures at the end of the discussion of Consolidated Results of Operations below. We strongly encourage investors and shareholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

The weighted-average diluted shares outstanding used in the calculation of non-GAAP net earnings per diluted share are the same as those used in the calculation of reported net earnings per diluted share for the respective period.

Dollar amounts are in millions except per share amounts or as otherwise specified. 14

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measures
Three Months 2022	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	2,782		$	1,455		$	364		$	808		$	8		$	816		—	%	$	2.14
Reported percent net sales	62.1		%	32.5		%	8.1		%	18.0		%	0.2		%	18.2		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	—			—			—			—			—			—			—		—
Other acquisition and integration-related	—			78			—			(78)			—			(82)			2.0		(0.21)
Amortization of purchased intangible assets	—			—			—			159			—			132			0.5		0.34
Restructuring-related and other charges	19			(31)			(8)			58			—			50			—		0.13
Medical device regulations	1			2			(39)			38			—			32			0.1		0.08
Recall-related matters	—			—			—			(4)			—			(4)			—		(0.01)
Regulatory and legal matters	—			(20)			—			20			—			15			0.2		0.04
Tax matters	—			—			—			—			(62)			(149)			11.7		(0.39)
Adjusted	$	2,802		$	1,484		$	317		$	1,001		$	(54)		$	810		14.5	%	$	2.12
Adjusted percent net sales	62.6		%	33.1		%	7.1		%	22.3		%	(1.2)		%	18.1		%

Three Months 2021	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	2,642		$	1,602		$	306		$	574		$	(79)		$	438		11.5	%	$	1.14
Reported percent net sales	63.5		%	38.5		%	7.4		%	13.8		%	(1.9)		%	10.5		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	94			—			—			94			—			73			1.9		0.19
Other acquisition and integration-related	—			(32)			—			32			—			24			0.8		0.06
Amortization of purchased intangible assets	—			—			—			144			—			114			2.0		0.30
Restructuring-related and other charges	20			(158)			—			178			—			165			(2.6)		0.44
Medical device regulations	1			—			(26)			27			—			23			(0.1)		0.06
Recall-related matters	—			—			—			16			—			12			0.3		0.03
Regulatory and legal matters	—			7			—			(7)			—			(7)			0.2		(0.02)
Tax matters	—			—			—			—			—			—			—		—
Adjusted	$	2,757		$	1,419		$	280		$	1,058		$	(79)		$	842		14.0	%	$	2.20
Adjusted percent net sales	66.3		%	34.1		%	6.7		%	25.4		%	(1.9)		%	20.2		%

Nine Months 2022	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	8,342		$	4,704		$	1,128		$	2,027		$	(105)		$	1,795		6.6	%	$	4.70
Reported percent net sales	63.0		%	35.5		%	8.5		%	15.3		%	(0.8)		%	13.6		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	12			—			—			12			—			9			—		0.02
Other acquisition and integration-related	—			(96)			—			96			—			46			1.9		0.12
Amortization of purchased intangible assets	—			—			—			469			—			371			1.7		0.97
Restructuring-related and other charges	29			(113)			(87)			229			—			190			0.4		0.50
Medical device regulations	3			—			(95)			98			—			82			0.1		0.21
Recall-related matters	—			—			—			14			—			10			0.1		0.03
Regulatory and legal matters	—			(53)			—			53			—			39			0.3		0.10
Tax matters	—			—			—			—			(74)			(120)			3.0		(0.31)
Adjusted	$	8,386		$	4,442		$	946		$	2,998		$	(179)		$	2,422		14.1	%	$	6.34
Adjusted percent net sales	63.3		%	33.5		%	7.1		%	22.6		%	(1.4)		%	18.3		%

Nine Months 2021	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	7,923		$	4,682		$	904		$	1,765		$	(241)		$	1,332		12.6	%	$	3.48
Reported percent net sales	63.9		%	37.7		%	7.3		%	14.2		%	(1.9)		%	10.7		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	231			—			—			231			—			176			1.4		0.46
Other acquisition and integration-related	—			(264)			—			264			—			204			1.4		0.53
Amortization of purchased intangible assets	—			—			—			474			—			378			1.7		0.99
Restructuring-related and other charges	20			(189)			—			209			11			198			(0.7)		0.52
Medical device regulations	2			—			(70)			72			—			60			0.1		0.16
Recall-related matters	—			—			—			98			—			85			(0.1)		0.22
Regulatory and legal matters	—			16			—			(16)			(3)			(19)			0.2		(0.05)
Tax matters	—			—			—			—			—			26			(1.8)		0.07
Adjusted	$	8,176		$	4,245		$	834		$	3,097		$	(233)		$	2,440		14.8	%	$	6.38
Adjusted percent net sales	65.9		%	34.2		%	6.7		%	25.0		%	(1.9)		%	19.7		%

Dollar amounts are in millions except per share amounts or as otherwise specified. 15

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

FINANCIAL CONDITION AND LIQUIDITY

Nine Months	2022		2021
Net cash provided by operating activities	$	1,621	$	2,263
Net cash used in investing activities	(2,762)		(545)
Net cash provided by (used in) financing activities	(303)		(2,077)
Effect of exchange rate changes on cash and cash equivalents	(80)		(21)
Change in cash and cash equivalents	$	(1,524)	$	(380)

Operating Activities

Cash provided by operating activities was $1,621 and $2,263 in the nine months 2022 and 2021. The decrease was primarily due to higher costs for certain electronic components and increases of other critical inventory to manage supply chain delays due to component shortages.

Investing Activities    

Cash used in investing activities was $2,762 and $545 in the nine months 2022 and 2021. The increase in cash used in 2022 was primarily due to the acquisition of Vocera and investments in capital projects partially offset by settlements of certain foreign currency forward contracts designated as net investment hedges.

Financing Activities

Cash provided by (used in) financing activities was ($303) and ($2,077) in the nine months 2022 and 2021. Cash used in 2022 was primarily driven by dividend payments and repayments of debt, including $500 of payments on the $1,500 term loan used to fund the acquisition of Vocera. Cash used in 2021 was primarily due to debt repayments of $750 in March 2021 and $400 for the term loan in June 2021. We did not repurchase any shares in the nine months 2022 and 2021. Dividends paid to common shareholders were $788 and $713 in the nine months 2022 and 2021.

Liquidity

Cash, cash equivalents and marketable securities were $1,497 and $3,019 on September 30, 2022 and December 31, 2021. Current assets exceeded current liabilities by $4,747 and $5,468 on September 30, 2022 and December 31, 2021. We anticipate being able to support our short-term liquidity and operating needs from a variety of sources including cash from operations, commercial paper and existing credit lines.

We raised funds in the capital markets in the past and may continue to do so from time-to-time. We continue to have strong investment-grade short-term and long-term debt ratings that we believe should enable us to refinance our debt as needed.

Our cash, cash equivalents and marketable securities held in locations outside the United States was approximately 47% on September 30, 2022 compared to 26% on December 31, 2021.

Critical Accounting Policies

There were no changes to our critical accounting policies from those disclosed in our Annual Report on Form 10-K for 2021.

New Accounting Pronouncements Not Yet Adopted

Refer to Note 1 to our Consolidated Financial Statements for information.

Guarantees and Other Off-Balance Sheet Arrangements

We do not have guarantees or other off-balance sheet financing arrangements, including variable interest entities, of a magnitude that we believe could have a material impact on our financial condition or liquidity.

OTHER MATTERS

Legal and Regulatory Matters

We are involved in various ongoing proceedings, legal actions and claims arising in the normal course of our business, including proceedings related to product, labor, intellectual property and other matters. Refer to Note 6 to our Consolidated Financial Statements for further information.

FORWARD-LOOKING STATEMENTS

This report contains statements referring to us that are not historical facts and are considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements, which are intended to take advantage of the "safe harbor" provisions of the Reform Act, are based on current projections about operations, industry conditions, financial condition and liquidity. Words that identify forward-looking statements include words such as "may," "could," "will," "should," "possible," "plan," "predict," "forecast," "potential," "anticipate," "estimate," "expect," "project," "intend," "believe," "may impact," "on track," "goal," "strategy" and words and terms of similar substance used in connection with any discussion of future operating or financial performance, an acquisition or our businesses. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Those statements are not guarantees and are subject to risks, uncertainties and assumptions that are difficult to predict, including uncertainties related to the impact of the COVID-19 pandemic on our operations and financial results. Therefore, actual results could differ materially and adversely from these forward-looking statements. Some important factors that could cause our actual results to differ from our expectations in any forward-looking statements include those risks discussed in Item 1A. "Risk Factors" of our Annual Report on Form 10-K for 2021 and Part II, Item 1A. "Risk Factors" in our Quarterly Reports on Form 10-Q for the quarters ended March 31 and June 30, 2022. This Form 10-Q should be read in conjunction with our Consolidated Financial Statements and accompanying notes to our Consolidated Financial Statements in our Annual Report on Form 10-K for 2021. We disclaim any intention or obligation to publicly update or revise any forward-looking statement to reflect any change in our expectations or in events, conditions or circumstances on which those expectations may be based, or that affect the likelihood that actual results will differ from those contained in the forward-looking statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We consider our greatest potential area of market risk exposure to be exchange rate risk on our operations and financial results. Quantitative and qualitative disclosures about exchange rate risk are included in Item 7A "Quantitative and Qualitative Disclosures About Market Risk" of our Annual Report on Form 10-K for 2021. There were no material changes from the information provided therein.

Dollar amounts are in millions except per share amounts or as otherwise specified. 16

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of the Chief Executive Officer and Chief Financial Officer (the Certifying Officers), evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended) on September 30, 2022. Based on that evaluation, the Certifying Officers concluded the Company's disclosure controls and procedures were effective as of September 30, 2022.

Changes in Internal Control Over Financial Reporting

There was no change to our internal control over financial reporting during the nine months 2022 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. In February 2022 we completed the acquisition of Vocera and are currently integrating Vocera into our operations, compliance programs and internal control processes. Vocera constituted approximately 8.5% of our total assets as of September 30, 2022, including the goodwill and intangible assets recorded as part of the purchase price allocation and approximately 1% of our net sales in the nine months ended September 30, 2022. United States Securities and Exchange Commission guidance allows companies to exclude acquisitions from their assessment of the internal control over financial reporting during the first year following an acquisition while integrating the acquired company. We have excluded the acquired operations of Vocera from our assessment of the Company's internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1A. RISK FACTORS

We are not aware of any material changes to the risk factors included in Item 1A. "Risk Factors" in our Annual Report on Form 10-K for 2021 and Part II, Item 1A. "Risk Factors" in our Quarterly Reports on Form 10-Q for the quarters ended March 31 and June 30, 2022.

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

We issued 25 shares of our common stock in the three months 2022 as performance incentive awards to employees. These shares are not registered under the Securities Act of 1933 based on the conclusion that the awards would not be events of sale within the meaning of Section 2(a)(3) of the Act.

In March 2015 we announced that our Board of Directors had authorized us to purchase up to $2,000 of our common stock. The manner, timing and amount of repurchases are determined by management based on an evaluation of market conditions, stock price, and other factors and are subject to regulatory considerations. Purchases are made from time-to-time in the open market, in privately negotiated transactions or otherwise.

In the nine months 2022 we did not repurchase any shares of our common stock under our authorized repurchase program. The total dollar value of shares of our common stock that could be acquired under our authorized repurchase program was $1,033 as of September 30, 2022.

ITEM 5. OTHER INFORMATION

Section 13(r) of the Securities Exchange Act of 1934, as amended, requires an issuer to disclose in its annual or quarterly reports whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to parties subject to sanctions administered by the Office of Foreign Assets Control (“OFAC”) within the United States Department of the Treasury, whether or not such activities are prohibited or sanctionable under United States law. On March 2, 2021, the United States government designated the Russian Federal Security Service (the “FSB”) under additional sanctions authorities. On the same day, OFAC issued General License No. 1B (the “OFAC General License”), which generally authorizes certain licensing, permitting, certification, notification and related transactions with the FSB as may be required pursuant to Russian encryption product import controls for the importation, distribution or use of certain information technology products and radio frequency technology products in the Russian Federation.

As required under Russian law and as permitted under the OFAC General License, one of our subsidiaries in Russia periodically files notifications with or applies for import licenses and permits from the FSB on our behalf in connection with the importation of our products into Russia. These notification and licensing activities are free of charge, and none of our gross revenue or net profits are attributable to such activities. We expect to continue to file notifications with and apply for import licenses and permits from the FSB to qualify our products for importation and distribution in the Russian Federation to the extent required under Russian law, but only so long as such notification and licensing activities are authorized by the OFAC General License, any successor general license or other authorization issued by OFAC.

During the three months 2022 we filed two notifications with the FSB as described above.

ITEM 6. EXHIBITS

31(i)	Certification of Principal Executive Officer of Stryker Corporation pursuant to Rule 13a-14(a).
31(ii)	Certification of Principal Financial Officer of Stryker Corporation pursuant to Rule 13a-14(a).
32(i)*	Certification by Principal Executive Officer of Stryker Corporation pursuant to 18 U.S.C. Section 1350.
32(ii)*	Certification by Principal Financial Officer of Stryker Corporation pursuant to 18 U.S.C. Section 1350.
101.INS	iXBRL Instance Document
101.SCH	iXBRL Schema Document
101.CAL	iXBRL Calculation Linkbase Document
101.DEF	iXBRL Definition Linkbase Document
101.LAB	iXBRL Label Linkbase Document
101.PRE	iXBRL Presentation Linkbase Document
104	Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)
	* Furnished with this Form 10-Q

Dollar amounts are in millions except per share amounts or as otherwise specified. 17

STRYKER CORPORATION 2022 Third Quarter Form 10-Q

SIGNATURES

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.

		STRYKER CORPORATION
		(Registrant)
Date:	November 1, 2022	/s/ KEVIN A. LOBO
		Kevin A. Lobo
		Chair, Chief Executive Officer and President
Date:	November 1, 2022	/s/ GLENN S. BOEHNLEIN
		Glenn S. Boehnlein
		Vice President, Chief Financial Officer

18

EX-31.1

Exhibit 31(i)

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Kevin A. Lobo, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 of Stryker Corporation;

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(s) 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.

5. The registrant’s other certifying officer(s) 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:	November 1, 2022	/s/ KEVIN A. LOBO
		Kevin A. Lobo
		Chair, Chief Executive Officer and President

EX-31.2

Exhibit 31(ii)

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Glenn S. Boehnlein, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 of Stryker Corporation;

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(s) 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.

5. The registrant’s other certifying officer(s) 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:	November 1, 2022	/s/ GLENN S. BOEHNLEIN
		Glenn S. Boehnlein
		Vice President, Chief Financial Officer

EX-32.1

Exhibit 32(i)

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Stryker Corporation (the "Company") for the quarter ended September 30, 2022 (the "Report"), I, Kevin A. Lobo, Chair and 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.

Date:	November 1, 2022	/s/ KEVIN A. LOBO
		Kevin A. Lobo
		Chair, Chief Executive Officer and President

EX-32.2

Exhibit 32(ii)

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Stryker Corporation (the "Company") for the quarter ended September 30, 2022 (the "Report"), I, Glenn S. Boehnlein, Vice President, 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.

Date:	November 1, 2022	/s/ GLENN S. BOEHNLEIN
		Glenn S. Boehnlein
		Vice President, Chief Financial Officer

XML

Document and Entity Information	9 Months Ended
	Sep. 30, 2022 shares
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	001-13149
Entity Registrant Name	STRYKER CORP
Entity Incorporation, State or Country Code	MI
Entity Tax Identification Number	38-1239739
Entity Address, Address Line One	2825 Airview Boulevard
Entity Address, City or Town	Kalamazoo,
Entity Address, State or Province	MI
Entity Address, Postal Zip Code	49002
City Area Code	(269)
Local Phone Number	385-2600
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	378,429,929
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity Central Index Key	0000310764
Current Fiscal Year End Date	--12-31
Common Stock
Document Information [Line Items]
Title of each class	Common Stock, $.10 Par Value
Trading Symbol	SYK
Security Exchange Name	NYSE
Senior Unsecured Notes 1.125% due 2021
Document Information [Line Items]
Title of each class	1.125% Notes due 2023
Trading Symbol	SYK23
Security Exchange Name	NYSE
Senior Unsecured Notes, 0.250% Due 2024
Document Information [Line Items]
Title of each class	0.250% Notes due 2024
Trading Symbol	SYK24A
Security Exchange Name	NYSE
Senior Unsecured Notes 2.125% due 2027
Document Information [Line Items]
Title of each class	2.125% Notes due 2027
Trading Symbol	SYK27
Security Exchange Name	NYSE
Senior Unsecured Notes, 0.750% Due 2029
Document Information [Line Items]
Title of each class	0.750% Notes due 2029
Trading Symbol	SYK29
Security Exchange Name	NYSE
Senior Unsecured Notes 2.625% due 2030
Document Information [Line Items]
Title of each class	2.625% Notes due 2030
Trading Symbol	SYK30
Security Exchange Name	NYSE
Senior Unsecured Notes, 1.000% Due 2031
Document Information [Line Items]
Title of each class	1.000% Notes due 2031
Trading Symbol	SYK31
Security Exchange Name	NYSE

XML

CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Statement [Abstract]
Net sales	$ 4,479	$ 4,160	$ 13,247	$ 12,407
Cost of sales	1,697	1,518	4,905	4,484
Gross profit	2,782	2,642	8,342	7,923
Research, development and engineering expenses	364	306	1,128	904
Selling, general and administrative expenses	1,455	1,602	4,704	4,682
Recall charges	(4)	16	14	98
Amortization of intangible assets	159	144	469	474
Total operating expenses	1,974	2,068	6,315	6,158
Operating income	808	574	2,027	1,765
Other income (expense), net	8	(79)	(105)	(241)
Earnings before income taxes	816	495	1,922	1,524
Income taxes	0	57	127	192
Net earnings	$ 816	$ 438	$ 1,795	$ 1,332
Net earnings per share of common stock:
Basic	$ 2.16	$ 1.17	$ 4.75	$ 3.54
Diluted	$ 2.14	$ 1.14	$ 4.70	$ 3.48
Weighted-average shares outstanding (in millions):
Basic	378.4	377.1	378.1	376.8
Effect of dilutive employee stock compensation	3.4	5.6	4.1	5.5
Diluted	381.8	382.7	382.2	382.3
Cash dividends declared per share of common stock (in dollars per share)	$ 0.695	$ 0.63	$ 2.085	$ 1.89

XML

CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)(Parenthetical) - shares shares in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Statement [Abstract]
Anti-dilutive shares excluded from calculation of dilutive employee stock options (in shares)	5.0	0.0	4.2	0.0

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Comprehensive Income [Abstract]
Net earnings	$ 816	$ 438	$ 1,795	$ 1,332
Other comprehensive income (loss), net of tax:
Marketable securities	0	3	(1)	3
Pension plans	10	5	17	8
Unrealized gains (losses) on designated hedges	8	7	33	43
Financial statement translation	179	112	393	287
Total other comprehensive income (loss), net of tax	197	127	442	341
Comprehensive income	$ 1,013	$ 565	$ 2,237	$ 1,673

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Current assets
Cash and cash equivalents	$ 1,420	$ 2,944
Marketable securities	77	75
Accounts receivable, less allowance of $150 ($167 in 2021)	3,103	3,022
Inventories:
Materials and supplies	852	691
Work in process	309	264
Finished goods	2,722	2,359
Total inventories	3,883	3,314
Prepaid expenses and other current assets	835	662
Total current assets	9,318	10,017
Property, plant and equipment:
Land, buildings and improvements	1,665	1,656
Machinery and equipment	3,869	3,842
Total property, plant and equipment	5,534	5,498
Less accumulated depreciation	2,736	2,665
Property, plant and equipment, net	2,798	2,833
Goodwill	14,993	12,918
Other intangibles, net	5,053	4,840
Noncurrent deferred income tax assets	1,390	1,760
Other noncurrent assets	2,431	2,263
Total assets	35,983	34,631
Current liabilities
Accounts payable	1,213	1,129
Accrued compensation	927	1,092
Income taxes	243	192
Dividends payable	263	263
Accrued product liabilities	391	401
Accrued expenses and other liabilities	1,526	1,465
Current maturities of debt	8	7
Total current liabilities	4,571	4,549
Long-term debt, excluding current maturities	12,751	12,472
Income taxes	621	913
Other noncurrent liabilities	1,577	1,820
Total liabilities	19,520	19,754
Shareholders' equity
Common stock, $0.10 par value	38	38
Additional paid-in capital	2,028	1,890
Retained earnings	14,486	13,480
Accumulated other comprehensive loss	(89)	(531)
Total shareholders' equity	16,463	14,877
Total liabilities and shareholders' equity	$ 35,983	$ 34,631
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 150	$ 167
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10

XML

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) shares in Millions, $ in Millions	Total	Common Stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)
Beginning balance at Dec. 31, 2020		$ 38	$ 1,741	$ 12,462	$ (1,157)
Beginning balance (in shares) at Dec. 31, 2020		376.1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under stock compensation and benefit plans			(7)
Issuance of common stock under stock option and benefit plans (in shares)		1.1
Share-based compensation			141
Net earnings	$ 1,332			1,332
Cash dividends declared				(713)
Other comprehensive income (loss)	341				341
Ending balance at Sep. 30, 2021	14,178	$ 38	1,875	13,081	(816)
Ending balance (in shares) at Sep. 30, 2021		377.2
Beginning balance at Jun. 30, 2021		$ 38	1,844	12,881	(943)
Beginning balance (in shares) at Jun. 30, 2021		377.1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under stock compensation and benefit plans		$ 0	(3)
Issuance of common stock under stock option and benefit plans (in shares)		0.1
Share-based compensation			34
Net earnings	438			438
Cash dividends declared				(238)
Other comprehensive income (loss)	127				127
Ending balance at Sep. 30, 2021	14,178	$ 38	1,875	13,081	(816)
Ending balance (in shares) at Sep. 30, 2021		377.2
Beginning balance at Dec. 31, 2021	14,877	$ 38	1,890	13,480	(531)
Beginning balance (in shares) at Dec. 31, 2021		377.5
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under stock compensation and benefit plans		$ 0	(2)
Issuance of common stock under stock option and benefit plans (in shares)		0.9
Share-based compensation			140
Net earnings	1,795			1,795
Cash dividends declared				(789)
Other comprehensive income (loss)	442				442
Ending balance at Sep. 30, 2022	16,463	$ 38	2,028	14,486	(89)
Ending balance (in shares) at Sep. 30, 2022		378.4
Beginning balance at Jun. 30, 2022		$ 38	1,989	13,933	(286)
Beginning balance (in shares) at Jun. 30, 2022		378.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock under stock compensation and benefit plans		$ 0	6
Issuance of common stock under stock option and benefit plans (in shares)		0.1
Share-based compensation			33
Net earnings	816			816
Cash dividends declared				(263)
Other comprehensive income (loss)	197				197
Ending balance at Sep. 30, 2022	$ 16,463	$ 38	$ 2,028	$ 14,486	$ (89)
Ending balance (in shares) at Sep. 30, 2022		378.4

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Operating activities
Net earnings	$ 1,795	$ 1,332
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	276	278
Amortization of intangible assets	469	474
Asset impairments	18	119
Share-based compensation	140	141
Recall charges	14	98
Sale of inventory stepped-up to fair value at acquisition	12	231
Changes in operating assets and liabilities:
Accounts receivable	(186)	(145)
Inventories	(754)	(231)
Accounts payable	111	134
Accrued expenses and other liabilities	5	184
Recall-related payments	(26)	(180)
Income taxes	(262)	(193)
Other, net	9	21
Net cash provided by operating activities	1,621	2,263
Investing activities
Acquisitions, net of cash acquired	(2,563)	(226)
Purchases of marketable securities	(43)	(38)
Proceeds from sales of marketable securities	40	43
Purchases of property, plant and equipment	(400)	(319)
Proceeds from settlement of net investment hedges	197	0
Other investing, net	7	(5)
Net cash used in investing activities	(2,762)	(545)
Financing activities
Proceeds (payments) on short-term borrowings, net	(376)	7
Proceeds from issuance of long-term debt	1,500	5
Payments on long-term debt	(502)	(1,151)
Payments of dividends	(788)	(713)
Cash paid for taxes from withheld shares	(89)	(88)
Other financing, net	(48)	(137)
Net cash provided by (used in) financing activities	(303)	(2,077)
Effect of exchange rate changes on cash and cash equivalents	(80)	(21)
Change in cash and cash equivalents	(1,524)	(380)
Cash and cash equivalents at beginning of period	2,944	2,943
Cash and cash equivalents at end of period	$ 1,420	$ 2,563

XML

Basis Of Presentation

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

BASIS OF PRESENTATION

General Information

Management believes the accompanying unaudited Consolidated Financial Statements contain all adjustments, including normal recurring items, considered necessary to fairly present the financial position of Stryker Corporation and its consolidated subsidiaries ("Stryker," the "Company," "we," "us" or "our") on September 30, 2022 and the results of operations for the three and nine months 2022. The results of operations included in these Consolidated Financial Statements may not necessarily be indicative of our annual results. These statements should be read in conjunction with our Annual Report on Form 10-K for 2021.

New Accounting Pronouncements Not Yet Adopted

We evaluate all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB) for consideration of their applicability. ASUs not included in our disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on our Consolidated Financial Statements.

In September 2022 the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations, which requires entities that utilize supplier finance programs in connection with the purchase of goods and services to disclose information about the key terms of the programs, a rollforward of the obligations under the programs and where those obligations are presented in the balance sheet. The new disclosure requirements are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating these new expanded disclosure requirements.

New Accounting Pronouncements Recently Adopted

On January 1, 2022 we adopted ASU 2021-08, Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This update requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers. The adoption of this update did not have a material impact on our Consolidated Financial Statements.

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Revenue Recognition

9 Months Ended

Sep. 30, 2022

Revenue Recognition [Abstract]

Revenue Recognition

REVENUE RECOGNITION

Our policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for 2021.

We disaggregate our net sales by product line and geographic location for each of our segments as we believe it best depicts how the nature, amount, timing and certainty of our net sales and cash flows are affected by economic factors.

Net Sales by Product Line
	Three Months				Nine Months
	2022		2021		2022		2021
MedSurg and Neurotechnology:
Instruments	$	535	$	525	$	1,626	$	1,511
Endoscopy	590		525		1,728		1,512
Medical	765		636		2,095		1,898
Neurovascular	294		295		901		885
Neuro Cranial	332		299		992		890
Other	72		69		218		203
	$	2,588	$	2,349	$	7,560	$	6,899
Orthopaedics and Spine:
Knees	$	481	$	439	$	1,445	$	1,325
Hips	347		328		1,038		990
Trauma and Extremities	672		639		2,033		1,953
Spine	280		282		849		867
Other	111		123		322		373
	$	1,891	$	1,811	$	5,687	$	5,508
Total	$	4,479	$	4,160	$	13,247	$	12,407

Net Sales by Geography
	Three Months 2022				Three Months 2021
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	425	$	110	$	415	$	110
Endoscopy	480		110		418		107
Medical	625		140		496		140
Neurovascular	110		184		113		182
Neuro Cranial	274		58		244		55
Other	71		1		68		1
	$	1,985	$	603	$	1,754	$	595
Orthopaedics and Spine:
Knees	$	365	$	116	$	321	$	118
Hips	225		122		199		129
Trauma and Extremities	494		178		447		192
Spine	206		74		201		81
Other	85		26		97		26
	$	1,375	$	516	$	1,265	$	546
Total	$	3,360	$	1,119	$	3,019	$	1,141

Net Sales by Geography
	Nine Months 2022				Nine Months 2021
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	1,290	$	336	$	1,171	$	340
Endoscopy	1,371		357		1,179		333
Medical	1,686		409		1,457		441
Neurovascular	333		568		339		546
Neuro Cranial	819		173		724		166
Other	214		4		200		3
	$	5,713	$	1,847	$	5,070	$	1,829
Orthopaedics and Spine:
Knees	$	1,078	$	367	$	964	$	361
Hips	657		381		606		384
Trauma and Extremities	1,470		563		1,362		591
Spine	615		234		611		256
Other	243		79		290		83
	$	4,063	$	1,624	$	3,833	$	1,675
Total	$	9,776	$	3,471	$	8,903	$	3,504

Contract Assets and Liabilities

On September 30, 2022 and December 31, 2021 contract assets recorded in our Consolidated Balance Sheets were not significant.

Our contract liabilities arise as a result of consideration received from customers at inception of contracts for certain businesses or where the timing of billing for services precedes satisfaction of our performance obligations. We generally satisfy performance obligations within one year from the contract inception date. Our contract liabilities were $661 and $529 on September 30, 2022 and December 31, 2021.

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Accumulated Other Comprehensive (Loss) Income (AOCI)

9 Months Ended

Sep. 30, 2022

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

Accumulated Other Comprehensive (Loss) Income (AOCI)

ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME (AOCI)

Three Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(1)	$	(148)	$	65	$	(202)	$	(286)
OCI	—		11		19		304		334
Income taxes	—		(3)		(1)		(119)		(123)
Reclassifications to:
Cost of sales	—		—		(7)		—		(7)
Other (income) expense, net	—		3		(2)		(8)		(7)
Income taxes	—		(1)		(1)		2		—
Net OCI	$	—	$	10	$	8	$	179	$	197
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Three Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(256)	$	26	$	(710)	$	(943)
OCI	4		2		6		71		83
Income taxes	—		—		(2)		47		45
Reclassifications to:
Cost of sales	—		—		4		—		4
Other (income) expense, net	—		4		(2)		(8)		(6)
Income taxes	(1)		(1)		1		2		1
Net OCI	$	3	$	5	$	7	$	112	$	127
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

Nine Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	—	$	(155)	$	40	$	(416)	$	(531)
OCI	(1)		15		55		658		727
Income taxes	—		(3)		(7)		(242)		(252)
Reclassifications to:
Cost of sales	—		—		(10)		—		(10)
Other (income) expense, net	—		7		(4)		(30)		(27)
Income taxes	—		(2)		(1)		7		4
Net OCI	$	(1)	$	17	$	33	$	393	$	442
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Nine Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(259)	$	(10)	$	(885)	$	(1,157)
OCI	4		1		40		269		314
Income taxes	—		(2)		(13)		37		22
Reclassifications to:
Cost of sales	—		—		9		—		9
Other (income) expense, net	—		12		7		(25)		(6)
Income taxes	(1)		(3)		—		6		2
Net OCI	$	3	$	8	$	43	$	287	$	341
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

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Derivative Instruments

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

DERIVATIVE INSTRUMENTS

We use operational and economic hedges, foreign currency exchange forward contracts, net investment hedges (both derivative and non-derivative financial instruments) and interest rate derivative instruments to manage the impact of currency exchange and interest rate fluctuations on earnings, cash flow and equity. We do not enter into derivative instruments for speculative purposes. We are exposed to potential credit loss in the event of nonperformance by our counterparties on our outstanding derivative instruments but do not anticipate nonperformance by any of our counterparties. Should a counterparty default, our maximum loss exposure is the asset balance of the instrument. We have not changed our hedging strategies, accounting practices or objectives from those disclosed in our Annual Report on Form 10-K for 2021.

Foreign Currency Hedges

September 2022	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	923	$	1,448	$	3,137	$	5,508
Maximum term in years							4.1
Fair value:
Other current assets	$	45	$	—	$	140	$	185
Other noncurrent assets	3		185		—		188
Other current liabilities	(7)		—		(10)		(17)
Other noncurrent liabilities	(1)		—		—		(1)
Total fair value	$	40	$	185	$	130	$	355

December 2021	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	973	$	2,266	$	5,512	$	8,751
Maximum term in years							4.9
Fair value:
Other current assets	$	15	$	39	$	92	$	146
Other noncurrent assets	1		65		—		66
Other current liabilities	(7)		—		(10)		(17)
Total fair value	$	9	$	104	$	82	$	195

We had €1.5 billion and €2.0 billion on September 30, 2022 and December 31, 2021 of certain foreign currency forward contracts designated as net investment hedges to hedge a portion of our investments in certain of our entities with functional currencies denominated in Euros. In addition to these derivative financial instruments designated as net investment hedges, we had €4.4 billion on September 30, 2022 and December 31, 2021 of senior unsecured notes designated as net investment hedges to selectively hedge portions of our investment in certain international subsidiaries. The currency effects of our Euro-denominated senior unsecured notes are reflected in AOCI within shareholders' equity where they offset gains and losses recorded on our net investment in international subsidiaries.

In the nine months 2022 we settled certain foreign currency forward contracts designated as net investment hedges resulting in cash proceeds of $197. The amounts in AOCI related to settled net investment hedges will remain in AOCI until the hedged investment is either sold or substantially liquidated.

On September 30, 2022 the total after tax gain (loss) in AOCI related to designated net investment hedges was $603.

Net Currency Exchange Rate Gains (Losses)

Derivative		Three Months				Nine Months
instrument:	Recorded in:	2022		2021		2022		2021
Cash Flow	Cost of sales	$	7	$	(4)	$	10	$	(9)
Net Investment	Other income (expense), net	8		8		30		25
Non-Designated	Other income (expense), net	(1)		(5)		2		(6)
	Total	$	14	$	(1)	$	42	$	10

Pretax gains (losses) on derivatives designated as cash flow hedges of $50 and net investment hedges of $34 recorded in AOCI are expected to be reclassified to cost of sales and other income (expense), net in earnings within 12 months as of September 30, 2022. This cash flow hedge reclassification is primarily due to the sale of inventory that includes previously hedged purchases. A component of the AOCI amounts related to net investment hedges is reclassified over the life of the hedge instruments as we elected to exclude the initial value of the component related to the spot-forward difference from the effectiveness assessment.

Interest Rate Hedges

Pretax gains of $5 recorded in AOCI related to other interest rate hedges closed in conjunction with debt issuances are expected to be reclassified to other income (expense), net in earnings within 12 months of September 30, 2022. The cash flow effect of interest rate hedges is recorded in cash flow from operations.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

Our policies for managing risk related to foreign currency, interest rates, credit and markets and our process for determining fair value have not changed from those described in our Annual Report on Form 10-K for 2021.

During the three months 2022 we determined that certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded a $110 reduction in the fair value of contingent consideration reflected in selling, general and administrative expenses.

There were no significant transfers into or out of any level of the fair value hierarchy in 2022.

Assets Measured at Fair Value	September		December
	2022		2021
Cash and cash equivalents	$	1,420	$	2,944
Trading marketable securities	155		193
Level 1 - Assets	$	1,575	$	3,137
Available-for-sale marketable securities:
Corporate and asset-backed debt securities	$	43	$	48
Foreign government debt securities	1		2
United States agency debt securities	2		5
United States Treasury debt securities	30		19
Certificates of deposit	1		1
Total available-for-sale marketable securities	$	77	$	75
Foreign currency exchange forward contracts	373		212
Level 2 - Assets	$	450	$	287
Total assets measured at fair value	$	2,025	$	3,424

Liabilities Measured at Fair Value	September		December
	2022		2021
Deferred compensation arrangements	$	155	$	193
Level 1 - Liabilities	$	155	$	193
Foreign currency exchange forward contracts	$	18	$	17
Level 2 - Liabilities	$	18	$	17
Contingent consideration:
Beginning	$	306	$	393
Additions	1		62
Change in estimate	(137)		(1)
Settlements	(47)		(148)
Ending	$	123	$	306
Level 3 - Liabilities	$	123	$	306
Total liabilities measured at fair value	$	296	$	516

Fair Value of Available for Sale Securities by Maturity
	September 2022		December 2021
Due in one year or less	$	50	$	36
Due after one year through three years	$	27	$	39

On September 30, 2022 and December 31, 2021 the aggregate difference between the cost and fair value of available-for-sale marketable securities was nominal. Interest and marketable securities income was $26 and $15 in the three months and $61 and $50 in the nine months 2022 and 2021, which was recorded in other income (expense), net.

Our investments in available-for-sale marketable securities had a minimum credit quality rating of A2 (Moody's), A (Standard & Poor's) and A (Fitch). We do not plan to sell the investments, and it is not more likely than not that we will be required to sell the investments before recovery of their amortized cost basis, which may be maturity.

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Contingencies and Commitments

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Contingencies and Commitments

CONTINGENCIES AND COMMITMENTS

We are involved in various ongoing proceedings, legal actions and claims arising in the normal course of business, including proceedings related to product, labor, intellectual property and other matters, the most significant of which are more fully described below. The outcomes of these matters will generally not be known for prolonged periods of time. In certain of the legal proceedings the claimants seek damages as well as other compensatory and equitable relief that could result in the payment of significant claims and settlements and/or the imposition of injunctions or other equitable relief. For legal matters for which management had sufficient information to reasonably estimate our future obligations, a liability representing management's best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within the range is not known, is recorded. The estimates are based on consultation with legal counsel, previous settlement experience and settlement strategies. If actual outcomes are less favorable than those estimated by management, additional expense may be incurred, which could unfavorably affect future operating results. We are self-insured for certain claims and expenses. The ultimate cost to us with respect to product liability claims could be materially different than the amount of the current estimates and accruals and could have a material adverse effect on our financial position, results of operations and cash flows.

In April 2022 the United States District Court for the District of Delaware issued a judgment following a jury verdict in favor of PureWick Corporation (PureWick) for its 2019 complaint seeking patent infringement damages related to our PrimaFit and PrimoFit products. The court awarded damages and we recorded charges of $28 in March 2022. In June 2022 PureWick filed a motion to seek enhancement of the judgment and if successful, the judgment could total approximately $100 and include an

injunction against future sales. We intend to appeal the outcome of this case.

Recall Matters

In June 2012 we voluntarily recalled our Rejuvenate and ABG II Modular-Neck hip stems and terminated global distribution of these hip products. Product liability lawsuits relating to this voluntary recall have been filed against us. In November 2014 we entered into a settlement agreement to compensate eligible United States patients who had revision surgery prior to November 3, 2014 and in December 2016 the settlement program was extended to patients who had revision surgery prior to December 19, 2016. In September 2020 we entered into a second settlement agreement to compensate eligible United States patients who had revision surgery prior to September 9, 2020. There are remaining lawsuits that we will continue to defend against.

In August 2016 and May 2018 we voluntarily recalled certain lot-specific sizes and offsets of LFIT Anatomic CoCr V40 Femoral Heads. Product liability lawsuits and claims relating to this voluntary recall have been filed against us. In November 2018 we entered into a settlement agreement to resolve a significant number of claims and lawsuits related to the recalls. In April 2022 we executed a second agreement to resolve a significant number of claims and lawsuits related to the recalls. The specific terms of the settlement agreement, including the financial terms, are confidential.

With the acquisition of Wright Medical Group N.V. (Wright) in November 2020, we are responsible for certain product liability claims, primarily related to certain hip products sold by Wright prior to its 2014 divestiture of the OrthoRecon business. We will continue to evaluate each claim and the possible loss we may incur.

We have incurred, and expect to incur in the future, costs associated with the defense and settlement of these matters. For the nine months 2022 we have recorded charges of $14 primarily related to Wright hip products and made payments of $26 primarily related to Rejuvenate and ABG II Modular-Neck hip stems. Based on the information that has been received, we have estimated the remaining range of probable loss related to recall matters globally to be approximately $375 to $510. We have recorded reserves representing the remaining minimum of the range of probable loss. The final outcomes of these matters are dependent on many factors that are difficult to predict. Accordingly the ultimate cost related to these matters may be materially different than the amount of our current estimate and accruals and could have a material adverse effect on our results of operations and cash flows.

Leases	September			December
	2022			2021
Right-of-use assets	$	456		$	419
Lease liabilities, current	$	116		$	112
Lease liabilities, non-current	$	349		$	310
Other information:
Weighted-average remaining lease term	5.5 years			5.4 years
Weighted-average discount rate	3.09		%	2.86		%

	Three Months				Nine Months
	2022		2021		2022		2021
Operating lease cost	$	37	$	35	$	110	$	102

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Acquisitions

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Acquisitions

ACQUISITIONS

We acquire stock in companies and various assets that continue to support our capital deployment and product development strategies. The aggregate purchase price of our acquisitions, net of cash acquired was $2,563 and $267 in the nine months 2022 and 2021.

In February 2022 we completed the acquisition of Vocera Communications, Inc. (Vocera) for $79.25 per share, or an aggregate purchase price of $2.6 billion, net of cash acquired ($3.0 billion including convertible notes). Vocera is a leader in the digital care coordination and communication category. Vocera is part of our Medical business within MedSurg and Neurotechnology. Goodwill attributable to the acquisition reflects the strategic benefits of expanding our presence in adjacent markets, diversifying our product portfolio, advancing innovations, and accelerating our digital aspirations. This goodwill is not deductible for tax purposes.

In the nine months 2022 note holders elected to redeem the 1.50% and 0.50% convertible notes assumed in the Vocera acquisition for $101 and $324. These repayments are classified as financing activities in the Consolidated Statements of Cash Flows.

Share-based awards for Vocera employees vested upon our acquisition and a charge of $132 was recorded in selling, general and administrative expenses in 2022.

Purchase price allocations for our significant acquisitions are:

Purchase Price Allocation of Acquired Net Assets
2022	Vocera
Tangible assets and liabilities:
Accounts receivable	$	33
Inventory	13
Deferred income tax assets	73
Other assets	92
Debt	(425)
Deferred income tax liabilities	(182)
Other liabilities	(115)
Intangible assets:
Customer and distributor relationships	550
Developed technology and patents	178
Trade name	18
Goodwill	2,328
Purchase price, net of cash acquired of $281	$	2,563
Weighted-average life of intangible assets	13

Purchase price allocations for Vocera were based on preliminary valuations, primarily related to intangible assets and deferred income taxes. Our estimates and assumptions are subject to change within the measurement period.

Consolidated Estimated Amortization Expense
Remainder of 2022		2023		2024		2025		2026
$	159	$	617	$	587	$	567	$	510

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Debt and Credit Facilities

9 Months Ended

Sep. 30, 2022

Long-term Debt, Unclassified [Abstract]

Debt And Credit Facilities

DEBT AND CREDIT FACILITIES

We have lines of credit issued by various financial institutions that are available to fund our day-to-day operating needs. Certain of our credit facilities require us to comply with financial and other covenants. We were in compliance with all covenants on September 30, 2022.

In February 2022 we entered into a $1.5 billion term loan agreement that matures on February 22, 2025 and bears interest at a base rate based on the Term Secured Overnight Financing Rate (SOFR) plus 0.725%. In the nine months 2022 we repaid $500 on the term loan.

In 2022 our Board of Directors approved an increase to the maximum amount of commercial paper that can be outstanding from $1,500 to $2,250.

On September 30, 2022 there were no borrowings outstanding under our credit facility or commercial paper program which allows for maturities up to 397 days from the date of issuance.

Summary of Total Debt			September 2022		December 2021
	Rate	Due
Senior unsecured notes:
	1.125%	November 30, 2023	$	530	$	622
	0.600%	December 1, 2023	599		598
	3.375%	May 15, 2024	595		593
	0.250%	December 3, 2024	817		958
	1.150%	June 15, 2025	647		645
	3.375%	November 1, 2025	748		748
	3.500%	March 15, 2026	995		994
	2.125%	November 30, 2027	720		845
	3.650%	March 7, 2028	597		597
	0.750%	March 1, 2029	767		901
	1.950%	June 15, 2030	991		990
	2.625%	November 30, 2030	619		727
	1.000%	December 3, 2031	715		840
	4.100%	April 1, 2043	392		392
	4.375%	May 15, 2044	395		395
	4.625%	March 15, 2046	982		982
	2.900%	June 15, 2050	642		642
Term loan		February 22, 2025	1,000		—
Other			8		10
Total debt			$	12,759	$	12,479
Less current maturities of debt			8		7
Total long-term debt			$	12,751	$	12,472
			September 2022		December 2021
Unamortized debt issuance costs			$	55	$	62
Borrowing capacity on existing facilities			$	2,162	$	2,162
Fair value of senior unsecured notes			$	10,401	$	13,391

The fair value of the senior unsecured notes was estimated using quoted interest rates, maturities and amounts of borrowings based on quoted active market prices and yields that took into account the underlying terms of the debt instruments. Substantially all of our debt is classified within Level 2 of the fair value hierarchy.

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Income Taxes	9 Months Ended
	Sep. 30, 2022
Income Tax [Abstract]
Income Taxes	INCOME TAXESOur effective tax rates were 0.0% and 6.6% in the three and nine months 2022. In the three months 2022 income tax expense decreased $162 due to the effective settlement of the United States federal income tax audit for years 2014 through 2018. In addition, other income (expense), net includes a benefit of $50 related to the release of accrued interest associated with this settlement. The nine months 2022 additionally include the reversal of deferred income tax on undistributed earnings of foreign subsidiaries no longer determined to be indefinitely reinvested. Our effective tax rates of 11.5% and 12.6% in the three and nine months 2021 include certain discrete tax items.

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Segment Information

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

As previously disclosed, effective December 31, 2021 we changed our reportable business segments to (i) MedSurg and Neurotechnology and (ii) Orthopaedics and Spine to align to our new internal reporting structure. We have reflected these changes in all historical periods presented.

	Three Months				Nine Months
	2022		2021		2022		2021
MedSurg and Neurotechnology	$	2,588	$	2,349	$	7,560	$	6,899
Orthopaedics and Spine	1,891		1,811		5,687		5,508
Net sales	$	4,479	$	4,160	$	13,247	$	12,407
MedSurg and Neurotechnology	$	626	$	663	$	1,838	$	2,000
Orthopaedics and Spine	519		500		1,648		1,518
Segment operating income	$	1,145	$	1,163	$	3,486	$	3,518
Items not allocated to segments:
Corporate and other	$	(144)	$	(105)	$	(488)	$	(421)
Acquisition and integration-related costs	78		(126)		(108)		(495)
Amortization of intangible assets	(159)		(144)		(469)		(474)
Restructuring-related and other charges	(58)		(178)		(229)		(209)
Medical device regulations	(38)		(27)		(98)		(72)
Recall-related matters	4		(16)		(14)		(98)
Regulatory and legal matters	(20)		7		(53)		16
Consolidated operating income	$	808	$	574	$	2,027	$	1,765

There were no significant changes to total assets by segment from information provided in our Annual Report on Form 10-K for 2021, other than the addition of the assets acquired in the Vocera acquisition which are included in the MedSurg and Neurotechnology segment.

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Asset Impairments

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

Asset Impairments

ASSET IMPAIRMENTS

The government in China has launched regional and national programs for volume-based procurement ("VBP") of high-value medical consumables to reduce healthcare costs. Each VBP program has specific requirements to award contracts to the lowest bidders who are able to satisfy the quality and quantity requirements. The successful bidders may be guaranteed sales volume for certain products, while unsuccessful bidders may lose unit sales volume. The prices required for a successful bid have negatively impacted our existing commercial operations of joint replacement and trauma products in China.

As a result of the outcome of certain regional programs for our trauma products and the national VBP program for hips and knees we recorded charges of $105 to impair certain long-lived and intangible assets in the third quarter of 2021. These charges were included in selling, general and administrative expenses. The national VBP program for spine products took place in the third quarter of 2022 and we were unsuccessful in our bid. As a result we are exiting the spine business in China. Asset impairments recorded in the three months 2022 were not significant. Our total business in China represented approximately 2.5% of our revenues for the nine months 2022.

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Basis Of Presentation (Policies)

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

New Accounting Pronouncements

New Accounting Pronouncements Not Yet Adopted

We evaluate all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB) for consideration of their applicability. ASUs not included in our disclosures were assessed and determined to be either not applicable or are not expected to have a material impact on our Consolidated Financial Statements.

In September 2022 the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations, which requires entities that utilize supplier finance programs in connection with the purchase of goods and services to disclose information about the key terms of the programs, a rollforward of the obligations under the programs and where those obligations are presented in the balance sheet. The new disclosure requirements are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating these new expanded disclosure requirements.

New Accounting Pronouncements Recently Adopted

On January 1, 2022 we adopted ASU 2021-08, Business Combinations: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This update requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers. The adoption of this update did not have a material impact on our Consolidated Financial Statements.

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Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2022

Revenue Recognition [Abstract]

Schedule of Disaggregated Revenue

We disaggregate our net sales by product line and geographic location for each of our segments as we believe it best depicts how the nature, amount, timing and certainty of our net sales and cash flows are affected by economic factors.

Net Sales by Product Line
	Three Months				Nine Months
	2022		2021		2022		2021
MedSurg and Neurotechnology:
Instruments	$	535	$	525	$	1,626	$	1,511
Endoscopy	590		525		1,728		1,512
Medical	765		636		2,095		1,898
Neurovascular	294		295		901		885
Neuro Cranial	332		299		992		890
Other	72		69		218		203
	$	2,588	$	2,349	$	7,560	$	6,899
Orthopaedics and Spine:
Knees	$	481	$	439	$	1,445	$	1,325
Hips	347		328		1,038		990
Trauma and Extremities	672		639		2,033		1,953
Spine	280		282		849		867
Other	111		123		322		373
	$	1,891	$	1,811	$	5,687	$	5,508
Total	$	4,479	$	4,160	$	13,247	$	12,407

Net Sales by Geography
	Three Months 2022				Three Months 2021
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	425	$	110	$	415	$	110
Endoscopy	480		110		418		107
Medical	625		140		496		140
Neurovascular	110		184		113		182
Neuro Cranial	274		58		244		55
Other	71		1		68		1
	$	1,985	$	603	$	1,754	$	595
Orthopaedics and Spine:
Knees	$	365	$	116	$	321	$	118
Hips	225		122		199		129
Trauma and Extremities	494		178		447		192
Spine	206		74		201		81
Other	85		26		97		26
	$	1,375	$	516	$	1,265	$	546
Total	$	3,360	$	1,119	$	3,019	$	1,141

Net Sales by Geography
	Nine Months 2022				Nine Months 2021
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	1,290	$	336	$	1,171	$	340
Endoscopy	1,371		357		1,179		333
Medical	1,686		409		1,457		441
Neurovascular	333		568		339		546
Neuro Cranial	819		173		724		166
Other	214		4		200		3
	$	5,713	$	1,847	$	5,070	$	1,829
Orthopaedics and Spine:
Knees	$	1,078	$	367	$	964	$	361
Hips	657		381		606		384
Trauma and Extremities	1,470		563		1,362		591
Spine	615		234		611		256
Other	243		79		290		83
	$	4,063	$	1,624	$	3,833	$	1,675
Total	$	9,776	$	3,471	$	8,903	$	3,504

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Accumulated Other Comprehensive (Loss) Income (AOCI) (Tables)

9 Months Ended

Sep. 30, 2022

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

Schedule of Accumulated Other Comprehensive Income (Loss)

Three Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(1)	$	(148)	$	65	$	(202)	$	(286)
OCI	—		11		19		304		334
Income taxes	—		(3)		(1)		(119)		(123)
Reclassifications to:
Cost of sales	—		—		(7)		—		(7)
Other (income) expense, net	—		3		(2)		(8)		(7)
Income taxes	—		(1)		(1)		2		—
Net OCI	$	—	$	10	$	8	$	179	$	197
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Three Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(256)	$	26	$	(710)	$	(943)
OCI	4		2		6		71		83
Income taxes	—		—		(2)		47		45
Reclassifications to:
Cost of sales	—		—		4		—		4
Other (income) expense, net	—		4		(2)		(8)		(6)
Income taxes	(1)		(1)		1		2		1
Net OCI	$	3	$	5	$	7	$	112	$	127
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

Nine Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	—	$	(155)	$	40	$	(416)	$	(531)
OCI	(1)		15		55		658		727
Income taxes	—		(3)		(7)		(242)		(252)
Reclassifications to:
Cost of sales	—		—		(10)		—		(10)
Other (income) expense, net	—		7		(4)		(30)		(27)
Income taxes	—		(2)		(1)		7		4
Net OCI	$	(1)	$	17	$	33	$	393	$	442
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Nine Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(259)	$	(10)	$	(885)	$	(1,157)
OCI	4		1		40		269		314
Income taxes	—		(2)		(13)		37		22
Reclassifications to:
Cost of sales	—		—		9		—		9
Other (income) expense, net	—		12		7		(25)		(6)
Income taxes	(1)		(3)		—		6		2
Net OCI	$	3	$	8	$	43	$	287	$	341
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

Reclassification out of Accumulated Other Comprehensive Income

Three Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(1)	$	(148)	$	65	$	(202)	$	(286)
OCI	—		11		19		304		334
Income taxes	—		(3)		(1)		(119)		(123)
Reclassifications to:
Cost of sales	—		—		(7)		—		(7)
Other (income) expense, net	—		3		(2)		(8)		(7)
Income taxes	—		(1)		(1)		2		—
Net OCI	$	—	$	10	$	8	$	179	$	197
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Three Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(256)	$	26	$	(710)	$	(943)
OCI	4		2		6		71		83
Income taxes	—		—		(2)		47		45
Reclassifications to:
Cost of sales	—		—		4		—		4
Other (income) expense, net	—		4		(2)		(8)		(6)
Income taxes	(1)		(1)		1		2		1
Net OCI	$	3	$	5	$	7	$	112	$	127
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

Nine Months 2022	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	—	$	(155)	$	40	$	(416)	$	(531)
OCI	(1)		15		55		658		727
Income taxes	—		(3)		(7)		(242)		(252)
Reclassifications to:
Cost of sales	—		—		(10)		—		(10)
Other (income) expense, net	—		7		(4)		(30)		(27)
Income taxes	—		(2)		(1)		7		4
Net OCI	$	(1)	$	17	$	33	$	393	$	442
Ending	$	(1)	$	(138)	$	73	$	(23)	$	(89)

Nine Months 2021	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(3)	$	(259)	$	(10)	$	(885)	$	(1,157)
OCI	4		1		40		269		314
Income taxes	—		(2)		(13)		37		22
Reclassifications to:
Cost of sales	—		—		9		—		9
Other (income) expense, net	—		12		7		(25)		(6)
Income taxes	(1)		(3)		—		6		2
Net OCI	$	3	$	8	$	43	$	287	$	341
Ending	$	—	$	(251)	$	33	$	(598)	$	(816)

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Derivative Instruments (Tables)

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

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

September 2022	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	923	$	1,448	$	3,137	$	5,508
Maximum term in years							4.1
Fair value:
Other current assets	$	45	$	—	$	140	$	185
Other noncurrent assets	3		185		—		188
Other current liabilities	(7)		—		(10)		(17)
Other noncurrent liabilities	(1)		—		—		(1)
Total fair value	$	40	$	185	$	130	$	355

December 2021	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	973	$	2,266	$	5,512	$	8,751
Maximum term in years							4.9
Fair value:
Other current assets	$	15	$	39	$	92	$	146
Other noncurrent assets	1		65		—		66
Other current liabilities	(7)		—		(10)		(17)
Total fair value	$	9	$	104	$	82	$	195

Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location

Derivative		Three Months				Nine Months
instrument:	Recorded in:	2022		2021		2022		2021
Cash Flow	Cost of sales	$	7	$	(4)	$	10	$	(9)
Net Investment	Other income (expense), net	8		8		30		25
Non-Designated	Other income (expense), net	(1)		(5)		2		(6)
	Total	$	14	$	(1)	$	42	$	10

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2022

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

Assets Measured at Fair Value	September		December
	2022		2021
Cash and cash equivalents	$	1,420	$	2,944
Trading marketable securities	155		193
Level 1 - Assets	$	1,575	$	3,137
Available-for-sale marketable securities:
Corporate and asset-backed debt securities	$	43	$	48
Foreign government debt securities	1		2
United States agency debt securities	2		5
United States Treasury debt securities	30		19
Certificates of deposit	1		1
Total available-for-sale marketable securities	$	77	$	75
Foreign currency exchange forward contracts	373		212
Level 2 - Assets	$	450	$	287
Total assets measured at fair value	$	2,025	$	3,424

Liabilities Measured at Fair Value	September		December
	2022		2021
Deferred compensation arrangements	$	155	$	193
Level 1 - Liabilities	$	155	$	193
Foreign currency exchange forward contracts	$	18	$	17
Level 2 - Liabilities	$	18	$	17
Contingent consideration:
Beginning	$	306	$	393
Additions	1		62
Change in estimate	(137)		(1)
Settlements	(47)		(148)
Ending	$	123	$	306
Level 3 - Liabilities	$	123	$	306
Total liabilities measured at fair value	$	296	$	516

Investments Classified by Contractual Maturity Date

Fair Value of Available for Sale Securities by Maturity
	September 2022		December 2021
Due in one year or less	$	50	$	36
Due after one year through three years	$	27	$	39

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Contingencies and Commitments (Tables)

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Lease, Cost

Leases	September			December
	2022			2021
Right-of-use assets	$	456		$	419
Lease liabilities, current	$	116		$	112
Lease liabilities, non-current	$	349		$	310
Other information:
Weighted-average remaining lease term	5.5 years			5.4 years
Weighted-average discount rate	3.09		%	2.86		%

	Three Months				Nine Months
	2022		2021		2022		2021
Operating lease cost	$	37	$	35	$	110	$	102

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Acquisitions (Tables)

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Schedule of Business Acquisitions, by Acquisition

Purchase price allocations for our significant acquisitions are:

Purchase Price Allocation of Acquired Net Assets
2022	Vocera
Tangible assets and liabilities:
Accounts receivable	$	33
Inventory	13
Deferred income tax assets	73
Other assets	92
Debt	(425)
Deferred income tax liabilities	(182)
Other liabilities	(115)
Intangible assets:
Customer and distributor relationships	550
Developed technology and patents	178
Trade name	18
Goodwill	2,328
Purchase price, net of cash acquired of $281	$	2,563
Weighted-average life of intangible assets	13

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Consolidated Estimated Amortization Expense
Remainder of 2022		2023		2024		2025		2026
$	159	$	617	$	587	$	567	$	510

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Debt and Credit Facilities (Tables)

9 Months Ended

Sep. 30, 2022

Long-term Debt, Unclassified [Abstract]

Schedule of Long-term Debt Instruments

Summary of Total Debt			September 2022		December 2021
	Rate	Due
Senior unsecured notes:
	1.125%	November 30, 2023	$	530	$	622
	0.600%	December 1, 2023	599		598
	3.375%	May 15, 2024	595		593
	0.250%	December 3, 2024	817		958
	1.150%	June 15, 2025	647		645
	3.375%	November 1, 2025	748		748
	3.500%	March 15, 2026	995		994
	2.125%	November 30, 2027	720		845
	3.650%	March 7, 2028	597		597
	0.750%	March 1, 2029	767		901
	1.950%	June 15, 2030	991		990
	2.625%	November 30, 2030	619		727
	1.000%	December 3, 2031	715		840
	4.100%	April 1, 2043	392		392
	4.375%	May 15, 2044	395		395
	4.625%	March 15, 2046	982		982
	2.900%	June 15, 2050	642		642
Term loan		February 22, 2025	1,000		—
Other			8		10
Total debt			$	12,759	$	12,479
Less current maturities of debt			8		7
Total long-term debt			$	12,751	$	12,472
			September 2022		December 2021
Unamortized debt issuance costs			$	55	$	62
Borrowing capacity on existing facilities			$	2,162	$	2,162
Fair value of senior unsecured notes			$	10,401	$	13,391

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Sales and Other Financial Information by Business Segment

	Three Months				Nine Months
	2022		2021		2022		2021
MedSurg and Neurotechnology	$	2,588	$	2,349	$	7,560	$	6,899
Orthopaedics and Spine	1,891		1,811		5,687		5,508
Net sales	$	4,479	$	4,160	$	13,247	$	12,407
MedSurg and Neurotechnology	$	626	$	663	$	1,838	$	2,000
Orthopaedics and Spine	519		500		1,648		1,518
Segment operating income	$	1,145	$	1,163	$	3,486	$	3,518
Items not allocated to segments:
Corporate and other	$	(144)	$	(105)	$	(488)	$	(421)
Acquisition and integration-related costs	78		(126)		(108)		(495)
Amortization of intangible assets	(159)		(144)		(469)		(474)
Restructuring-related and other charges	(58)		(178)		(229)		(209)
Medical device regulations	(38)		(27)		(98)		(72)
Recall-related matters	4		(16)		(14)		(98)
Regulatory and legal matters	(20)		7		(53)		16
Consolidated operating income	$	808	$	574	$	2,027	$	1,765

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Revenue Recognition - Disaggregated Sales Analysis (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Net sales	$ 4,479	$ 4,160	$ 13,247	$ 12,407
United States
Disaggregation of Revenue [Line Items]
Net sales	3,360	3,019	9,776	8,903
International
Disaggregation of Revenue [Line Items]
Net sales	1,119	1,141	3,471	3,504
MedSurg and Neurotechnology:
Disaggregation of Revenue [Line Items]
Net sales	2,588	2,349	7,560	6,899
MedSurg and Neurotechnology: | United States
Disaggregation of Revenue [Line Items]
Net sales	1,985	1,754	5,713	5,070
MedSurg and Neurotechnology: | International
Disaggregation of Revenue [Line Items]
Net sales	603	595	1,847	1,829
MedSurg and Neurotechnology: | Instruments
Disaggregation of Revenue [Line Items]
Net sales	535	525	1,626	1,511
MedSurg and Neurotechnology: | Instruments | United States
Disaggregation of Revenue [Line Items]
Net sales	425	415	1,290	1,171
MedSurg and Neurotechnology: | Instruments | International
Disaggregation of Revenue [Line Items]
Net sales	110	110	336	340
MedSurg and Neurotechnology: | Endoscopy
Disaggregation of Revenue [Line Items]
Net sales	590	525	1,728	1,512
MedSurg and Neurotechnology: | Endoscopy | United States
Disaggregation of Revenue [Line Items]
Net sales	480	418	1,371	1,179
MedSurg and Neurotechnology: | Endoscopy | International
Disaggregation of Revenue [Line Items]
Net sales	110	107	357	333
MedSurg and Neurotechnology: | Medical
Disaggregation of Revenue [Line Items]
Net sales	765	636	2,095	1,898
MedSurg and Neurotechnology: | Medical | United States
Disaggregation of Revenue [Line Items]
Net sales	625	496	1,686	1,457
MedSurg and Neurotechnology: | Medical | International
Disaggregation of Revenue [Line Items]
Net sales	140	140	409	441
MedSurg and Neurotechnology: | Neurovascular
Disaggregation of Revenue [Line Items]
Net sales	294	295	901	885
MedSurg and Neurotechnology: | Neurovascular | United States
Disaggregation of Revenue [Line Items]
Net sales	110	113	333	339
MedSurg and Neurotechnology: | Neurovascular | International
Disaggregation of Revenue [Line Items]
Net sales	184	182	568	546
MedSurg and Neurotechnology: | Neuro Cranial
Disaggregation of Revenue [Line Items]
Net sales	332	299	992	890
MedSurg and Neurotechnology: | Neuro Cranial | United States
Disaggregation of Revenue [Line Items]
Net sales	274	244	819	724
MedSurg and Neurotechnology: | Neuro Cranial | International
Disaggregation of Revenue [Line Items]
Net sales	58	55	173	166
MedSurg and Neurotechnology: | Other
Disaggregation of Revenue [Line Items]
Net sales	72	69	218	203
MedSurg and Neurotechnology: | Other | United States
Disaggregation of Revenue [Line Items]
Net sales	71	68	214	200
MedSurg and Neurotechnology: | Other | International
Disaggregation of Revenue [Line Items]
Net sales	1	1	4	3
Orthopaedics and Spine:
Disaggregation of Revenue [Line Items]
Net sales	1,891	1,811	5,687	5,508
Orthopaedics and Spine: | United States
Disaggregation of Revenue [Line Items]
Net sales	1,375	1,265	4,063	3,833
Orthopaedics and Spine: | International
Disaggregation of Revenue [Line Items]
Net sales	516	546	1,624	1,675
Orthopaedics and Spine: | Other
Disaggregation of Revenue [Line Items]
Net sales	111	123	322	373
Orthopaedics and Spine: | Other | United States
Disaggregation of Revenue [Line Items]
Net sales	85	97	243	290
Orthopaedics and Spine: | Other | International
Disaggregation of Revenue [Line Items]
Net sales	26	26	79	83
Orthopaedics and Spine: | Knees
Disaggregation of Revenue [Line Items]
Net sales	481	439	1,445	1,325
Orthopaedics and Spine: | Knees | United States
Disaggregation of Revenue [Line Items]
Net sales	365	321	1,078	964
Orthopaedics and Spine: | Knees | International
Disaggregation of Revenue [Line Items]
Net sales	116	118	367	361
Orthopaedics and Spine: | Hips
Disaggregation of Revenue [Line Items]
Net sales	347	328	1,038	990
Orthopaedics and Spine: | Hips | United States
Disaggregation of Revenue [Line Items]
Net sales	225	199	657	606
Orthopaedics and Spine: | Hips | International
Disaggregation of Revenue [Line Items]
Net sales	122	129	381	384
Orthopaedics and Spine: | Trauma and Extremities
Disaggregation of Revenue [Line Items]
Net sales	672	639	2,033	1,953
Orthopaedics and Spine: | Trauma and Extremities | United States
Disaggregation of Revenue [Line Items]
Net sales	494	447	1,470	1,362
Orthopaedics and Spine: | Trauma and Extremities | International
Disaggregation of Revenue [Line Items]
Net sales	178	192	563	591
Orthopaedics and Spine: | Spine
Disaggregation of Revenue [Line Items]
Net sales	280	282	849	867
Orthopaedics and Spine: | Spine | United States
Disaggregation of Revenue [Line Items]
Net sales	206	201	615	611
Orthopaedics and Spine: | Spine | International
Disaggregation of Revenue [Line Items]
Net sales	$ 74	$ 81	$ 234	$ 256

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Revenue Recognition - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Revenue Recognition [Abstract]
Contract liabilities	$ 661	$ 529

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Accumulated Other Comprehensive (Loss) Income (AOCI) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period	$ (286)	$ (943)	$ (531)	$ (1,157)
OCI	334	83	727	314
Income taxes	(123)	45	(252)	22
Cost of sales	1,697	1,518	4,905	4,484
Other (income) expense, net	8	(79)	(105)	(241)
Income taxes	0	(57)	(127)	(192)
Net OCI	197	127	442	341
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period	(89)	(816)	(89)	(816)
Reclassification out of Accumulated Other Comprehensive Income
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cost of sales	(7)	4	(10)	9
Other (income) expense, net	(7)	(6)	(27)	(6)
Income taxes	0	1	4	2
Net OCI	197	127	442	341
Marketable Securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period	(1)	(3)	0	(3)
OCI	0	4	(1)	4
Income taxes	0	0	0	0
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period	(1)	0	(1)	0
Marketable Securities | Reclassification out of Accumulated Other Comprehensive Income
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cost of sales	0	0	0	0
Other (income) expense, net	0	0	0	0
Income taxes	0	(1)	0	(1)
Net OCI	0	3	(1)	3
Pension Plans
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period	(148)	(256)	(155)	(259)
OCI	11	2	15	1
Income taxes	(3)	0	(3)	(2)
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period	(138)	(251)	(138)	(251)
Pension Plans | Reclassification out of Accumulated Other Comprehensive Income
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cost of sales	0	0	0	0
Other (income) expense, net	3	4	7	12
Income taxes	(1)	(1)	(2)	(3)
Net OCI	10	5	17	8
Hedges
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period	65	26	40	(10)
OCI	19	6	55	40
Income taxes	(1)	(2)	(7)	(13)
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period	73	33	73	33
Hedges | Reclassification out of Accumulated Other Comprehensive Income
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cost of sales	(7)	4	(10)	9
Other (income) expense, net	(2)	(2)	(4)	7
Income taxes	(1)	1	(1)	0
Net OCI	8	7	33	43
Financial Statement Translation
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss), Net of Tax at beginning of period	(202)	(710)	(416)	(885)
OCI	304	71	658	269
Income taxes	(119)	47	(242)	37
Accumulated Other Comprehensive Income (Loss), Net of Tax at end of period	(23)	(598)	(23)	(598)
Financial Statement Translation | Reclassification out of Accumulated Other Comprehensive Income
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cost of sales	0	0	0	0
Other (income) expense, net	(8)	(8)	(30)	(25)
Income taxes	2	2	7	6
Net OCI	$ 179	$ 112	$ 393	$ 287

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Derivative Instruments (Forward Currency Exchange Contracts) (Details) - Foreign Exchange Contract € in Millions, $ in Millions	6 Months Ended	9 Months Ended
	Jun. 30, 2022	Sep. 30, 2022 USD ($)	Sep. 30, 2022 EUR (€)	Dec. 31, 2021 USD ($)	Dec. 31, 2021 EUR (€)
Derivative [Line Items]
Notional Amount		$ 5,508		$ 8,751
Maximum term in years	4 years 10 months 24 days	4 years 1 month 6 days
Derivative, Fair Value, Net		$ 355		195
Other current assets
Derivative [Line Items]
Derivative assets		185		146
Other noncurrent assets
Derivative [Line Items]
Derivative assets		188		66
Other current liabilities
Derivative [Line Items]
Derivative liabilities		(17)		(17)
Other noncurrent liabilities
Derivative [Line Items]
Derivative liabilities		(1)
Net Investment
Derivative [Line Items]
Notional Amount | €			€ 4,400		€ 4,400
Non-Designated
Derivative [Line Items]
Notional Amount		3,137		5,512
Derivative, Fair Value, Net		130		82
Non-Designated | Other current assets
Derivative [Line Items]
Derivative assets		140		92
Non-Designated | Other noncurrent assets
Derivative [Line Items]
Derivative assets		0		0
Non-Designated | Other current liabilities
Derivative [Line Items]
Derivative liabilities		(10)		(10)
Non-Designated | Other noncurrent liabilities
Derivative [Line Items]
Derivative liabilities		0
Cash Flow | Net Investment
Derivative [Line Items]
Notional Amount		923		973
Derivative, Fair Value, Net		40		9
Cash Flow | Net Investment | Other current assets
Derivative [Line Items]
Derivative assets		45		15
Cash Flow | Net Investment | Other noncurrent assets
Derivative [Line Items]
Derivative assets		3		1
Cash Flow | Net Investment | Other current liabilities
Derivative [Line Items]
Derivative liabilities		(7)		(7)
Cash Flow | Net Investment | Other noncurrent liabilities
Derivative [Line Items]
Derivative liabilities		(1)
Net Investment | Net Investment
Derivative [Line Items]
Notional Amount		1,448		2,266
Derivative, Fair Value, Net		185		104
Net Investment | Net Investment | Other current assets
Derivative [Line Items]
Derivative assets		0		39
Net Investment | Net Investment | Other noncurrent assets
Derivative [Line Items]
Derivative assets		185		65
Net Investment | Net Investment | Other current liabilities
Derivative [Line Items]
Derivative liabilities		0		$ 0
Net Investment | Net Investment | Other noncurrent liabilities
Derivative [Line Items]
Derivative liabilities		$ 0

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Derivative Instruments (Narrative) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 EUR (€)	Dec. 31, 2021 USD ($)	Dec. 31, 2021 EUR (€)
Proceeds from settlement of net investment hedges	$ 197	$ 0
Foreign Exchange Contract
Notional amount	5,508			$ 8,751
Designated as Hedging Instrument | Foreign Exchange Contract
Derivative, notional amount | €			€ 1,500,000,000		€ 2,000,000,000
Notional amount | €			€ 4,400,000,000		€ 4,400,000,000
Derivative, fair value	603
Cash flow hedge gain (loss) to be reclassified within twelve months	50
Net investment hedges expected to be reclassified to cost of sales and other income (expense)	34
Designated as Hedging Instrument | Interest Rate Swap
Cash flow hedge gain (loss) to be reclassified within twelve months	$ 5

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Derivative Instruments (Income Statement Location) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Foreign Exchange Contract
Derivative Instruments, Gain (Loss) [Line Items]
Net currency exchange rate gains (losses)	$ 14	$ (1)	$ 42	$ 10
Foreign Exchange Contract | Cost of sales
Derivative Instruments, Gain (Loss) [Line Items]
Net currency exchange rate gains (losses)	7	(4)	10	(9)
Foreign Exchange Contract | Other income (expense), net
Derivative Instruments, Gain (Loss) [Line Items]
Net currency exchange rate gains (losses)	(1)	(5)	2	(6)
Net Investment | Other income (expense), net
Derivative Instruments, Gain (Loss) [Line Items]
Net currency exchange rate gains (losses)	$ 8	$ 8	$ 30	$ 25

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Fair Value Measurements (Valuation Of Financial Instruments By Pricing Categories) (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	$ 1,420	$ 2,944
Assets
Available-for-sale securities, current	77	75
Investments Fair Value Disclosure	2,025	3,424
Contingent consideration:
Total liabilities measured at fair value	296	516
Fair Value, Inputs, Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	1,420	2,944
Trading marketable securities	155	193
Assets
Investments Fair Value Disclosure	1,575	3,137
Deferred compensation arrangements	155	193
Contingent consideration:
Total liabilities measured at fair value	155	193
Fair Value, Inputs, Level 2
Assets
Available-for-sale securities, current	77	75
Investments Fair Value Disclosure	450	287
Contingent consideration:
Total liabilities measured at fair value	18	17
Fair Value, Inputs, Level 2 | Foreign currency exchange forward contracts
Assets
Derivative asset	373	212
Liabilities
Foreign currency exchange forward contracts	18	17
Fair Value, Inputs, Level 2 | Corporate and asset-backed debt securities
Assets
Available-for-sale securities, current	43	48
Fair Value, Inputs, Level 2 | Foreign government
Assets
Available-for-sale securities, current	1	2
Fair Value, Inputs, Level 2 | United States agency debt securities
Assets
Available-for-sale securities, current	2	5
Fair Value, Inputs, Level 2 | United States Treasury debt securities
Assets
Available-for-sale securities, current	30	19
Fair Value, Inputs, Level 2 | Certificates of deposit
Assets
Available-for-sale securities, current	1	1
Fair Value, Inputs, Level 3
Contingent consideration:
Beginning	306	393
Additions	1	62
Change in estimate	(137)	(1)
Settlements	(47)	(148)
Ending	123	306
Total liabilities measured at fair value	$ 123	$ 306

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Fair Value Measurements (Assets and Liabilities Measured At Fair Value On A Recurring Basis Using Unobservable Inputs (Level 3)) (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Fair Value Disclosures [Abstract]
Due in one year or less	$ 50	$ 36
Due after one year through three years	$ 27	$ 39

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Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Fair Value Disclosures [Abstract]
Reduction of contingent consideration	$ 110
Gain on sale of marketable securities	$ 26	$ 15	$ 61	$ 50

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Contingencies and Commitments (Narrative) (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Loss Contingencies [Line Items]
Recall-related payments				$ (26)	$ (180)
Recall charges		$ (4)	$ 16	14	$ 98
PureWick
Loss Contingencies [Line Items]
Charges during period	$ 28
Estimate of possible loss		100		100
Minimum
Loss Contingencies [Line Items]
Estimate of possible loss		375		375
Maximum
Loss Contingencies [Line Items]
Estimate of possible loss		$ 510		$ 510

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Contingencies and Commitments - Leases (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Right-of-use assets	$ 456		$ 456		$ 419
Lease liabilities, current	116		116		112
Lease liabilities, non-current	$ 349		$ 349		$ 310
Other information:
Weighted-average remaining lease term	5 years 6 months		5 years 6 months		5 years 4 months 24 days
Weighted-average discount rate	3.09%		3.09%		2.86%
Operating lease cost	$ 37	$ 35	$ 110	$ 102

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Acquisitions (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended	3 Months Ended	9 Months Ended
	Feb. 28, 2022	Sep. 30, 2022	Sep. 30, 2022	Sep. 30, 2021
Business Acquisition [Line Items]
Aggregate purchase price of acquisitions			$ 2,563	$ 267
Payments of long-term debt			$ 502	$ 1,151
Vocera
Business Acquisition [Line Items]
Aggregate purchase price of acquisitions	$ 2,600
Consideration transferred (in dollars per share)	$ 79.25
Business combination, consideration transferred, including convertible notes	$ 3,000
Share-based payment expense		$ 132
Vocera | 1.50% Convertible Notes
Business Acquisition [Line Items]
Stated interest rate		1.50%	1.50%
Payments of long-term debt			$ 101
Vocera | 0.50% Convertible Notes
Business Acquisition [Line Items]
Stated interest rate		0.50%	0.50%
Payments of long-term debt			$ 324

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Acquisitions (Allocation Of The Preliminary Purchase Price To The Acquired Net Assets (Details) - USD ($) $ in Millions	1 Months Ended	9 Months Ended
	Feb. 28, 2022	Sep. 30, 2022	Dec. 31, 2021
Goodwill		$ 14,993	$ 12,918
Vocera
Accounts receivable		33
Inventory		13
Deferred income tax assets		73
Other assets		92
Debt		(425)
Deferred income tax liabilities		(182)
Other liabilities		(115)
Goodwill		2,328
Purchase price, net of cash acquired of $281		$ 2,563
Weighted-average life of intangible assets		13 years
Cash acquired from acquisition	$ 281
Vocera | Customer and distributor relationships
Intangible assets acquired		$ 550
Vocera | Developed technology and patents
Intangible assets acquired		178
Vocera | Trade name
Intangible assets acquired		$ 18

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Acquisitions (Future Amortization Expense) (Details) $ in Millions	Sep. 30, 2022 USD ($)
Business Combinations [Abstract]
Remainder of 2022	$ 159
2023	617
2024	587
2025	567
2026	$ 510

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Debt and Credit Facilities (Details) - USD ($)	1 Months Ended		9 Months Ended
	Jun. 30, 2022	Feb. 28, 2022	Sep. 30, 2022	Dec. 31, 2021
Commercial paper			$ 0
Borrowings outstanding under credit facility			0
Other Long-term Debt			8,000,000	$ 10,000,000
Total debt			12,759,000,000	12,479,000,000
Less current maturities of debt			8,000,000	7,000,000
Total long-term debt			12,751,000,000	12,472,000,000
Unamortized debt issuance costs			55,000,000	62,000,000
Borrowing capacity on existing facilities			2,162,000,000	2,162,000,000
Fair value of senior unsecured notes			$ 10,401,000,000	13,391,000,000
Term Loan
Debt instrument, face amount		$ 1,500,000,000
Repayments of debt	$ 500,000,000
Maturity Date			Feb. 22, 2025
Long-term Debt			$ 1,000,000,000	0
Term Loan | SOFR
Basis spread on variable rate (as a percent)		0.725%
Credit Agreement | Revolving Credit Facility
Line of credit facility, maximum borrowing capacity			$ 2,250,000,000	1,500,000,000
Senior Unsecured Notes 1.125% due 2021
Stated interest rate			1.125%
Maturity Date			Nov. 30, 2023
Unsecured Debt			$ 530,000,000	622,000,000
Senior Unsecured Notes, 0.600% Due 2023
Stated interest rate			0.60%
Maturity Date			Dec. 01, 2023
Unsecured Debt			$ 599,000,000	598,000,000
Senior Unsecured Notes 3.375% due 2024
Stated interest rate			3.375%
Maturity Date			May 15, 2024
Unsecured Debt			$ 595,000,000	593,000,000
Senior Unsecured Notes, 0.250% Due 2024
Stated interest rate			0.25%
Maturity Date			Dec. 03, 2024
Unsecured Debt			$ 817,000,000	958,000,000
Senior Unsecured Notes, 1.150% Due 2025
Stated interest rate			1.15%
Maturity Date			Jun. 15, 2025
Unsecured Debt			$ 647,000,000	645,000,000
Senior Unsecured Notes 3.375% due 2025
Stated interest rate			3.375%
Maturity Date			Nov. 01, 2025
Unsecured Debt			$ 748,000,000	748,000,000
Senior Unsecured Notes 3.50% due 2026
Stated interest rate			3.50%
Maturity Date			Mar. 15, 2026
Unsecured Debt			$ 995,000,000	994,000,000
Senior Unsecured Notes 2.125% due 2027
Stated interest rate			2.125%
Maturity Date			Nov. 30, 2027
Unsecured Debt			$ 720,000,000	845,000,000
Senior Unsecured Notes 3.650% due 2028
Stated interest rate			3.65%
Maturity Date			Mar. 07, 2028
Unsecured Debt			$ 597,000,000	597,000,000
Senior Unsecured Notes, 0.750% Due 2029
Stated interest rate			0.75%
Maturity Date			Mar. 01, 2029
Unsecured Debt			$ 767,000,000	901,000,000
Senior Unsecured Notes, 1.950% Due 2030
Stated interest rate			1.95%
Maturity Date			Jun. 15, 2030
Unsecured Debt			$ 991,000,000	990,000,000
Senior Unsecured Notes 2.625% due 2030
Stated interest rate			2.625%
Maturity Date			Nov. 30, 2030
Unsecured Debt			$ 619,000,000	727,000,000
Senior Unsecured Notes, 1.000% Due 2031
Stated interest rate			1.00%
Maturity Date			Dec. 03, 2031
Unsecured Debt			$ 715,000,000	840,000,000
Senior Unsecured Notes 4.100% due 2043
Stated interest rate			4.10%
Maturity Date			Apr. 01, 2043
Unsecured Debt			$ 392,000,000	392,000,000
Senior Unsecured Notes 4.375% due 2044
Stated interest rate			4.375%
Maturity Date			May 15, 2044
Unsecured Debt			$ 395,000,000	395,000,000
Senior Unsecured Notes 4.625% due 2046
Stated interest rate			4.625%
Maturity Date			Mar. 15, 2046
Unsecured Debt			$ 982,000,000	982,000,000
Senior Unsecured Notes, 2.900% due 2050
Stated interest rate			2.90%
Maturity Date			Jun. 15, 2050
Unsecured Debt			$ 642,000,000	$ 642,000,000
Commercial Paper
Debt instrument, maturity			397 days

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Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Tax [Abstract]
Effective income tax rate reconciliation, percent	0.00%	11.50%	6.60%	12.60%
Tax settlement amount	$ 162
Tax settlement, release of accrued interest	$ 50

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Segment Information (Sales And Other Financial Information By Business Segment) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Segment Reporting Information [Line Items]
Net sales	$ 4,479	$ 4,160	$ 13,247	$ 12,407
Segment operating income	808	574	2,027	1,765
Amortization of intangible assets	(159)	(144)	(469)	(474)
Recall-related matters	4	(16)	(14)	(98)
MedSurg and Neurotechnology:
Segment Reporting Information [Line Items]
Net sales	2,588	2,349	7,560	6,899
Orthopaedics and Spine:
Segment Reporting Information [Line Items]
Net sales	1,891	1,811	5,687	5,508
Operating Segments
Segment Reporting Information [Line Items]
Segment operating income	1,145	1,163	3,486	3,518
Operating Segments | MedSurg and Neurotechnology:
Segment Reporting Information [Line Items]
Net sales	2,588	2,349	7,560	6,899
Segment operating income	626	663	1,838	2,000
Operating Segments | Orthopaedics and Spine:
Segment Reporting Information [Line Items]
Net sales	1,891	1,811	5,687	5,508
Segment operating income	519	500	1,648	1,518
Corporate and other
Segment Reporting Information [Line Items]
Segment operating income	(144)	(105)	(488)	(421)
Segment Reconciling Items
Segment Reporting Information [Line Items]
Acquisition and integration-related costs	78	(126)	(108)	(495)
Amortization of intangible assets	(159)	(144)	(469)	(474)
Restructuring-related and other charges	(58)	(178)	(229)	(209)
Medical device regulations	(38)	(27)	(98)	(72)
Recall-related matters	4	(16)	(14)	(98)
Regulatory and legal matters	$ (20)	$ 7	$ (53)	$ 16

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Asset Impairments (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended		12 Months Ended
	Sep. 30, 2022	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Concentration Risk [Line Items]
Asset impairments	$ 105	$ 18	$ 119
Revenue Benchmark | Geographic Concentration Risk | CHINA
Concentration Risk [Line Items]
Concentration risk (as a percent)				2.50%