XML 41 R31.htm IDEA: XBRL DOCUMENT v3.22.2
Fair Value Measurements and Fair Value of Financial Instruments (Tables)
 6 Months Ended
Jul. 02, 2022
Fair Value Disclosures [Abstract]  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]
July 2,Quoted
prices in
active
markets		Significant
other
observable
inputs		Significant
unobservable
inputs
(In millions)2022(Level 1)(Level 2)(Level 3)
Assets
Cash equivalents
$173 $173 $— $— 
Investments
64 64 — — 
Warrants
13 — 13 — 
Insurance contracts
153 — 153 — 
Derivative contracts
103 — 103 — 
Total assets
$506 $237 $269 $— 
Liabilities
Derivative contracts
$1 $— $1 $— 
Contingent consideration
216 — — 216 
Total liabilities
$217 $— $1 $216 
December 31,Quoted
prices in
active
markets		Significant
other
observable
inputs		Significant
unobservable
inputs
(In millions)2021(Level 1)(Level 2)(Level 3)
Assets
Cash equivalents
$2,210 $2,210 $— $— 
Investments
298 298 — — 
Warrants
15 — 15 — 
Insurance contracts
181 — 181 — 
Derivative contracts
36 — 36 — 
Total assets
$2,740 $2,508 $232 $— 
Liabilities
Derivative contracts
$1 $— $1 $— 
Contingent consideration
317 — — 317 
Total liabilities
$318 $— $1 $317 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] The following table provides a rollforward of the fair value, as determined by level 3 inputs (such as likelihood of achieving production or revenue milestones, as well as changes in the fair values of the investments underlying a recapitalization investment portfolio), of the contingent consideration.
Three months endedSix months ended
July 2,July 3,July 2,July 3,
(In millions)2022202120222021
Contingent consideration
Beginning balance$261 $227 $317 $70 
Acquisitions (including assumed balances)— 17 (18)179 
Payments(2)(35)(32)(42)
Changes in fair value included in earnings(43)(60)(51)(58)
Ending balance$216 $149 $216 $149 
Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block] The following table provides the aggregate notional value of outstanding derivative contracts.
July 2,December 31,
(In millions)20222021
Notional amount
Cross-currency interest rate swaps - designated as net investment hedges
$900 $900 
Currency exchange contracts
1,571 2,149 
While certain derivatives are subject to netting arrangements with counterparties, the company does not offset derivative assets and liabilities within the balance sheet. The following tables present the fair value of derivative instruments in the accompanying balance sheet and statement of income.
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]
 Fair value – assetsFair value – liabilities
 July 2,December 31,July 2,December 31,
(In millions)2022202120222021
Derivatives designated as hedging instruments
Cross-currency interest rate swaps (a)
$98 $25 $— $— 
Derivatives not designated as hedging instruments
Currency exchange contracts (b)
5 11 1 1 
Total derivatives$103 $36 $1 $1 
(a)    The fair value of the cross-currency interest rate swaps is included in the accompanying balance sheet under the caption other assets or other long-term liabilities.
(b)    The fair value of the currency exchange contracts is included in the accompanying balance sheet under the captions other current assets or other accrued expenses.
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]
 Gain (loss) recognized
Three months endedSix months ended
July 2,July 3,July 2,July 3,
(In millions)2022202120222021
Fair value hedging relationships
Interest rate swaps
Hedged long-term obligations - included in other income/(expense)
$— $— $— $25 
Derivatives designated as hedging instruments - included in other income/(expense)
— — — (3)
Derivatives designated as cash flow hedges
Interest rate swaps
Amount reclassified from accumulated other comprehensive items to other income/(expense)
(1)(2)(2)(19)
Financial instruments designated as net investment hedges
Foreign currency-denominated debt and other payables
Included in currency translation adjustment within other comprehensive items
671 (90)1,033 376 
Cross-currency interest rate swaps
Included in currency translation adjustment within other comprehensive items
51 (6)74 32 
Included in other income/(expense)
4 2 6 4 
Derivatives not designated as hedging instruments
Currency exchange contracts
Included in cost of product revenues
21 (11)12 1 
Included in other income/(expense)
13 (28)12 155 
Fair Value, by Balance Sheet Grouping [Table Text Block]
The carrying value and fair value of the company’s debt instruments are as follows:
July 2, 2022December 31, 2021
CarryingFairCarryingFair
(In millions)valuevaluevaluevalue
Senior notes
$29,986 $27,265 $32,072 $33,449 
Commercial paper
— — 2,522 2,522 
Other
74 74 76 76 
$30,060 $27,339 $34,670 $36,047 
The fair value of debt instruments was determined based on quoted market prices and on borrowing rates available to the company at the respective period ends, which represent level 2 measurements.
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments [Table Text Block]
The carrying value and fair value of the company’s debt instruments are as follows:
July 2, 2022December 31, 2021
CarryingFairCarryingFair
(In millions)valuevaluevaluevalue
Senior notes
$29,986 $27,265 $32,072 $33,449 
Commercial paper
— — 2,522 2,522 
Other
74 74 76 76 
$30,060 $27,339 $34,670 $36,047 
The fair value of debt instruments was determined based on quoted market prices and on borrowing rates available to the company at the respective period ends, which represent level 2 measurements.