Restructuring, Impairment, and Related Charges, Net

9 Months Ended

Dec. 31, 2022

Restructuring and Related Activities [Abstract]

Restructuring, Impairment, and Related Charges

Restructuring, Impairment, and Related Charges, Net

The Company recorded restructuring, impairment, and related charges of $31 million and $18 million for the three months ended December 31, 2022 and 2021, respectively, and $84 million and $208 million for the nine months ended December 31, 2022 and 2021, respectively. These charges were included in “Restructuring, impairment, and related charges, net” in the Condensed Consolidated Statements of Operations.

Restructuring Initiatives

During the first quarter of fiscal 2022, the Company approved an initiative to increase operational efficiencies and flexibility by transitioning to a partial remote work model for certain employees. This initiative primarily included the rationalization of the Company’s office space in North America. Where the Company ceased using office space, it exited the portion of the facility no longer used. It also retained and repurposed certain other office locations. The Company recorded charges of $5 million and $115 million for the three and nine months ended December 31, 2021, respectively, primarily related to lease right-of-use and other long-lived asset impairments, lease exit costs, and accelerated depreciation and amortization. This initiative was substantially completed in fiscal 2022 and remaining costs the Company recorded and expects to record under this initiative are not material.

Restructuring, impairment, and related charges, net, for the three months ended December 31, 2022 and 2021 consisted of the following:


	Three Months Ended December 31, 2022
(In millions)	U.S. Pharmaceutical		Prescription Technology Solutions		Medical-Surgical Solutions		International		Corporate		Total
Severance and employee-related costs, net	$	—	$	—	$	—	$	—	$	4	$	4
Exit and other-related costs (1)	1		1		1		7		15		25
Asset impairments and accelerated depreciation	1		—		—		1		—		2
Total	$	2	$	1	$	1	$	8	$	19	$	31

(1)Exit and other-related costs consist of accruals for costs to be incurred without future economic benefits, project consulting fees, and other exit costs expensed as incurred. Corporate includes costs for business transformation and optimization efforts related to the Company’s technology organization. The International segment includes costs related to the Company’s European divestitures.


	Three Months Ended December 31, 2021
(In millions)	U.S. Pharmaceutical		Prescription Technology Solutions		Medical-Surgical Solutions		International		Corporate		Total
Severance and employee-related costs, net	$	—	$	—	$	—	$	—	$	1	$	1
Exit and other-related costs (1)	3		—		1		6		6		16
Asset impairments and accelerated depreciation	—		—		—		(1)		2		1
Total	$	3	$	—	$	1	$	5	$	9	$	18

(1)Exit and other-related costs consist of accruals for costs to be incurred without future economic benefits, project consulting fees, and other exit costs expensed as incurred.

Restructuring, impairment, and related charges, net, for the nine months ended December 31, 2022 and 2021 consisted of the following:


	Nine Months Ended December 31, 2022
(In millions)	U.S. Pharmaceutical		Prescription Technology Solutions		Medical-Surgical Solutions		International		Corporate		Total
Severance and employee-related costs, net	$	3	$	—	$	—	$	2	$	(2)	$	3
Exit and other-related costs (1)	2		4		3		15		44		68
Asset impairments and accelerated depreciation	4		11		—		2		(4)		13
Total	$	9	$	15	$	3	$	19	$	38	$	84


	Nine Months Ended December 31, 2021
(In millions)	U.S. Pharmaceutical (1)		Prescription Technology Solutions (1)		Medical-Surgical Solutions (1)		International (2)		Corporate (1)		Total
Severance and employee-related costs, net	$	2	$	(1)	$	1	$	10	$	2	$	14
Exit and other-related costs (3)	7		2		3		21		33		66
Asset impairments and accelerated depreciation	16		17		5		35		55		128
Total	$	25	$	18	$	9	$	66	$	90	$	208

(1)Includes costs related to the transition to a partial remote work model described above.

(2)Includes costs related to the transition to a partial remote work model described above, U.K. operating model and cost optimization efforts, and costs for optimization programs in Canada.

(3)Exit and other-related costs consist of accruals for costs to be incurred without future economic benefits, project consulting fees, and other exit costs expensed as incurred.

The following table summarizes the activity related to the liabilities associated with the Company’s restructuring initiatives for the nine months ended December 31, 2022:


(In millions)	U.S. Pharmaceutical		Prescription Technology Solutions		Medical-Surgical Solutions		International		Corporate		Total
Balance, March 31, 2022 (1)	$	11	$	3	$	1	$	56	$	59	$	130
Restructuring, impairment, and related charges, net	9		15		3		19		38		84
Non-cash charges	(4)		(11)		—		(2)		4		(13)
Cash payments	(4)		(4)		(3)		(7)		(57)		(75)
Other (2)	(1)		—		—		(54)		1		(54)
Balance, December 31, 2022 (3)	$	11	$	3	$	1	$	12	$	45	$	72

(1)As of March 31, 2022, the total reserve balance was $130 million, of which $58 million was recorded in “Other accrued liabilities,” $36 million was recorded in “Liabilities held for sale,” and $36 million was recorded in “Other non-current liabilities” in the Condensed Consolidated Balance Sheet.

(2)Other primarily includes cumulative translation adjustments and transfers to certain other liabilities. For the Company’s International segment, other also includes a reduction to the liability for the divestitures of the E.U. disposal group and the U.K. disposal group in fiscal 2023, as discussed in more detail in Financial Note 2, “Business Acquisitions and Divestitures.”

(3)As of December 31, 2022, the total reserve balance was $72 million, of which $48 million was recorded in “Other accrued liabilities” and $24 million was recorded in “Other non-current liabilities” in the Condensed Consolidated Balance Sheet.