Segment Reporting

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

NOTE K – SEGMENT REPORTING

Our seven core businesses are organized into three reportable segments: MedSurg, Rhythm and Neuro, and Cardiovascular, which represent an aggregation of our operating segments that generate revenues from the sale of medical devices. We measure and evaluate our reportable segments based on net sales of reportable segments, operating income of reportable segments, excluding intersegment profits, and operating income of reportable segments as a percentage of net sales of reportable segments. Operating income of reportable segments as a percentage of net sales of reportable segments is defined as operating income of reportable segments divided by net sales of reportable segments. We exclude from operating income of reportable segments certain corporate-related expenses and certain transactions or adjustments that our chief operating decision maker (CODM) considers to be non-operational, such as amounts related to amortization expense, goodwill and other intangible asset impairment charges, acquisition/divestiture-related net charges (credits), restructuring and restructuring-related net charges (credits); and certain litigation-related net charges (credits) and European Union (EU) Medical Device Regulation (MDR) implementation costs. Although we exclude these amounts from operating income of reportable segments, they are included in reported Income (loss) before income taxes in our accompanying unaudited consolidated statements of operations and are included in the reconciliation below.

A reconciliation of the totals reported for the reportable segments to the applicable line items within our accompanying unaudited consolidated statements of operations is as follows (in millions, except percentages):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
MedSurg	$	917	$	825	$	2,725	$	2,175
Rhythm and Neuro	819		757		2,436		1,985
Cardiovascular	1,196		1,002		3,588		2,862
Total net sales of reportable segments	2,932		2,584		8,748		7,021
All other (Specialty Pharmaceuticals)(1)	—		74		13		183
Net sales	$	2,932	$	2,659	$	8,761	$	7,204

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
MedSurg	$	338	$	307	$	1,033	$	738
Rhythm and Neuro	160		165		476		296
Cardiovascular	361		208		1,117		593
Total operating income of reportable segments	859		680		2,626		1,628
All other (Specialty Pharmaceuticals)(1)	—		49		4		124
Unallocated amounts:
Corporate expenses, including hedging activities	(109)		(108)		(438)		(330)
Intangible asset impairment charges, acquisition/divestiture-related net charges (credits), restructuring and restructuring-related net charges (credits), and certain litigation-related net charges (credits) and EU MDR implementation costs	(178)		(629)		(624)		(957)
Amortization expense	(184)		(197)		(549)		(595)
Operating income (loss)	387		(205)		1,019		(130)
Other expense, net	95		(22)		(62)		(256)
Income (loss) before income taxes	$	483	$	(227)	$	957	$	(386)
(1) On March 1, 2021, we completed the divestiture of the Specialty Pharmaceuticals business. Our consolidated net sales and income (loss) before income taxes for the first nine months of 2021 include Specialty Pharmaceuticals up to the date of the closing of the transaction.

Operating income margin of reportable segments	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
MedSurg	36.8	%	37.2	%	37.9	%	33.9	%
Rhythm and Neuro	19.5	%	21.9	%	19.5	%	14.9	%
Cardiovascular	30.2	%	20.8	%	31.1	%	20.7	%