Thermo Fisher Chairman Marc N. Casper Attributes Success to Proven Growth Strategy and Welcomes Olink Colleagues

24 July 2024 | Wednesday | Company results

Thermo Fisher Scientific Reports Strong Financial Performance and Share Gains
Marc N. Casper, chairman, president, and chief executive officer of Thermo Fisher Scientific.

Marc N. Casper, chairman, president, and chief executive officer of Thermo Fisher Scientific.

Thermo Fisher Scientific Inc. (NYSE: TMO), the world leader in serving science, today reported its financial results for the second quarter ended June 29, 2024.

Second Quarter 2024 Highlights

  • Second quarter revenue was $10.54 billion.
  • Second quarter GAAP diluted earnings per share (EPS) increased 15% to $4.04.
  • Second quarter adjusted EPS increased 4% to $5.37.
  • Continued to strengthen our industry-leading commercial engine and deepen our trusted partner status with customers to accelerate their innovation and enhance their productivity. In the quarter, we expanded our leading clinical trial supply services with a new ultra-cold facility in Bleiswijk, the Netherlands and a new state-of-the-art innovation lab at our site in Center Valley, Pennsylvania, to enable our pharmaceutical and biotech customers to accelerate the development of therapies and medicines. Also in the quarter, to support Indonesia’s growing investments in healthcare, scientific research, and renewable energy, we expanded our presence and capabilities in the country, further demonstrating our relevance to customers around the world.
  • Shortly after the quarter ended, we completed our acquisition of Olink, a provider of differentiated next-generation proteomic solutions. The addition of Olink’s technology extends our capabilities and further advances our leadership position in protein research, enabling our customers to meaningfully accelerate discovery and scientific breakthroughs while delivering on the promise of precision medicine.

“Our excellent execution enabled us to deliver another quarter of strong financial performance and share gain,” said Marc N. Casper, chairman, president, and chief executive officer of Thermo Fisher Scientific. “We continue to see the benefit of our proven growth strategy and the impact of our PPI Business System in our performance. Shortly after the quarter ended, we were also pleased to welcome our Olink colleagues to Thermo Fisher and are excited about the power of this new combination to better serve our customers and advance science.”

Casper added, “We have made very good progress through the halfway point of the year and are in a great position to deliver differentiated performance in 2024. We’ve further extended our industry leadership and positioned our company for an even brighter future.”

Second Quarter 2024

Revenue for the quarter declined 1% to $10.54 billion in 2024, versus $10.69 billion in 2023. Organic revenue was 1% lower and Core organic revenue growth was flat.

GAAP Earnings Results

GAAP diluted EPS in the second quarter of 2024 increased 15% to $4.04, versus $3.51 in the same quarter last year. GAAP operating income for the second quarter of 2024 grew to $1.82 billion, compared with $1.58 billion in the year-ago quarter. GAAP operating margin increased to 17.3%, compared with 14.8% in the second quarter of 2023.

Non-GAAP Earnings Results

Adjusted EPS in the second quarter of 2024 increased 4% to $5.37, versus $5.15 in the second quarter of 2023. Adjusted operating income for the second quarter of 2024 was $2.35 billion, compared with $2.37 billion in the year-ago quarter. Adjusted operating margin increased to 22.3%, compared with 22.2% in the second quarter of 2023.

Annual Guidance for 2024

Thermo Fisher is raising its full-year revenue and adjusted EPS guidance. The company is raising its revenue guidance to a new range of $42.4 to $43.3 billion versus its previous guidance of $42.3 to $43.3 billion. The company is raising its adjusted EPS guidance to a new range of $21.29 to $22.07 versus its previous guidance of $21.14 to $22.02.

Use of Non-GAAP Financial Measures

Adjusted EPS, adjusted net income, adjusted operating income, adjusted operating margin, free cash flow, organic revenue growth and Core organic revenue growth are non-GAAP measures that exclude certain items detailed after the tables that accompany this press release, under the heading “Supplemental Information Regarding Non-GAAP Financial Measures.”

 

Condensed Consolidated Statements of Income (unaudited)

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

June 29,

 

% of

 

July 1,

 

% of

(Dollars in millions except per share amounts)

 

2024

 

Revenues

 

2023

 

Revenues

Revenues

 

$

10,541

 

 

 

 

$

10,687

 

 

 

Costs and operating expenses:

 

 

 

 

 

 

 

 

Cost of revenues (a)

 

 

6,106

 

 

57.9

%

 

 

6,323

 

 

59.2

%

Selling, general and administrative expenses (b)

 

 

1,687

 

 

16.0

%

 

 

1,673

 

 

15.7

%

Amortization of acquisition-related intangible assets

 

 

513

 

 

4.9

%

 

 

585

 

 

5.4

%

Research and development expenses

 

 

339

 

 

3.2

%

 

 

345

 

 

3.2

%

Restructuring and other costs (c)

 

 

77

 

 

0.7

%

 

 

183

 

 

1.7

%

Total costs and operating expenses

 

 

8,722

 

 

82.7

%

 

 

9,109

 

 

85.2

%

Operating income

 

 

1,820

 

 

17.3

%

 

 

1,578

 

 

14.8

%

Interest income

 

 

295

 

 

 

 

 

178

 

 

 

Interest expense

 

 

(354

)

 

 

 

 

(326

)

 

 

Other income/(expense) (d)

 

 

5

 

 

 

 

 

 

 

 

Income before income taxes

 

 

1,765

 

 

 

 

 

1,430

 

 

 

Provision for income taxes (e)

 

 

(128

)

 

 

 

 

(52

)

 

 

Equity in earnings/(losses) of unconsolidated entities

 

 

(84

)

 

 

 

 

(16

)

 

 

Net income

 

 

1,553

 

 

 

 

 

1,362

 

 

 

Less: net income/(losses) attributable to noncontrolling interests and redeemable noncontrolling interest

 

 

6

 

 

 

 

 

1

 

 

 

Net income attributable to Thermo Fisher Scientific Inc.

 

$

1,548

 

 

14.7

%

 

$

1,361

 

 

12.7

%

 

 

 

 

 

 

 

 

 

Earnings per share attributable to Thermo Fisher Scientific Inc.:

 

 

 

 

 

 

 

 

Basic

 

$

4.05

 

 

 

 

$

3.53

 

 

 

Diluted

 

$

4.04

 

 

 

 

$

3.51

 

 

 

Weighted average shares:

 

 

 

 

 

 

 

 

Basic

 

 

382

 

 

 

 

 

386

 

 

 

Diluted

 

 

383

 

 

 

 

 

388

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted operating income and adjusted operating margin

 

 

 

 

 

 

 

 

GAAP operating income

 

$

1,820

 

 

17.3

%

 

$

1,578

 

 

14.8

%

Cost of revenues adjustments (a)

 

 

1

 

 

0.0

%

 

 

18

 

 

0.2

%

Selling, general and administrative expenses adjustments (b)

 

 

(64

)

 

-0.6

%

 

 

6

 

 

0.1

%

Restructuring and other costs (c)

 

 

77

 

 

0.7

%

 

 

183

 

 

1.7

%

Amortization of acquisition-related intangible assets

 

 

513

 

 

4.9

%

 

 

585

 

 

5.4

%

Adjusted operating income (non-GAAP measure)

 

$

2,347

 

 

22.3

%

 

$

2,370

 

 

22.2

%

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted net income

 

 

 

 

 

 

 

 

GAAP net income attributable to Thermo Fisher Scientific Inc.

 

$

1,548

 

 

 

 

$

1,361

 

 

 

Cost of revenues adjustments (a)

 

 

1

 

 

 

 

 

18

 

 

 

Selling, general and administrative expenses adjustments (b)

 

 

(64

)

 

 

 

 

6

 

 

 

Restructuring and other costs (c)

 

 

77

 

 

 

 

 

183

 

 

 

Amortization of acquisition-related intangible assets

 

 

513

 

 

 

 

 

585

 

 

 

Other income/expense adjustments (d)

 

 

 

 

 

 

 

(1

)

 

 

Provision for income taxes adjustments (e)

 

 

(102

)

 

 

 

 

(171

)

 

 

Equity in earnings/losses of unconsolidated entities

 

 

84

 

 

 

 

 

16

 

 

 

Noncontrolling interests adjustments (f)

 

 

(1

)

 

 

 

 

 

 

 

Adjusted net income (non-GAAP measure)

 

$

2,057

 

 

 

 

$

1,997

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted earnings per share

 

 

 

 

 

 

 

 

GAAP diluted EPS attributable to Thermo Fisher Scientific Inc.

 

$

4.04

 

 

 

 

$

3.51

 

 

 

Cost of revenues adjustments (a)

 

 

0.00

 

 

 

 

 

0.05

 

 

 

Selling, general and administrative expenses adjustments (b)

 

 

(0.17

)

 

 

 

 

0.01

 

 

 

Restructuring and other costs (c)

 

 

0.20

 

 

 

 

 

0.47

 

 

 

Amortization of acquisition-related intangible assets

 

 

1.34

 

 

 

 

 

1.51

 

 

 

Other income/expense adjustments (d)

 

 

0.00

 

 

 

 

 

0.00

 

 

 

Provision for income taxes adjustments (e)

 

 

(0.26

)

 

 

 

 

(0.44

)

 

 

Equity in earnings/losses of unconsolidated entities

 

 

0.22

 

 

 

 

 

0.04

 

 

 

Noncontrolling interests adjustments (f)

 

 

0.00

 

 

 

 

 

0.00

 

 

 

Adjusted EPS (non-GAAP measure)

 

$

5.37

 

 

 

 

$

5.15

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of free cash flow

 

 

 

 

 

 

 

 

GAAP net cash provided by operating activities

 

$

1,960

 

 

 

 

$

1,540

 

 

 

Purchases of property, plant and equipment

 

 

(301

)

 

 

 

 

(284

)

 

 

Proceeds from sale of property, plant and equipment

 

 

15

 

 

 

 

 

4

 

 

 

Free cash flow (non-GAAP measure)

 

$

1,674

 

 

 

 

$

1,260

 

 

 

Business Segment Information

 

Three months ended

 

 

June 29,

 

% of

 

July 1,

 

% of

(Dollars in millions)

 

2024

 

Revenues

 

2023

 

Revenues

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Life Sciences Solutions

 

$

2,355

 

 

22.3

%

 

$

2,463

 

 

23.0

%

Analytical Instruments

 

 

1,782

 

 

16.9

%

 

 

1,749

 

 

16.4

%

Specialty Diagnostics

 

 

1,117

 

 

10.6

%

 

 

1,109

 

 

10.4

%

Laboratory Products and Biopharma Services

 

 

5,758

 

 

54.6

%

 

 

5,831

 

 

54.6

%

Eliminations

 

 

(470

)

 

-4.5

%

 

 

(465

)

 

-4.4

%

Consolidated revenues

 

$

10,541

 

 

100.0

%

 

$

10,687

 

 

100.0

%

 

 

 

 

 

 

 

 

 

Segment income and segment income margin

 

 

 

 

 

 

 

 

Life Sciences Solutions

 

$

865

 

 

36.7

%

 

$

817

 

 

33.2

%

Analytical Instruments

 

 

439

 

 

24.6

%

 

 

432

 

 

24.7

%

Specialty Diagnostics

 

 

299

 

 

26.7

%

 

 

297

 

 

26.7

%

Laboratory Products and Biopharma Services

 

 

745

 

 

12.9

%

 

 

824

 

 

14.1

%

Subtotal reportable segments

 

 

2,347

 

 

22.3

%

 

 

2,370

 

 

22.2

%

Cost of revenues adjustments (a)

 

 

(1

)

 

0.0

%

 

 

(18

)

 

-0.2

%

Selling, general and administrative expenses adjustments (b)

 

 

64

 

 

0.6

%

 

 

(6

)

 

-0.1

%

Restructuring and other costs (c)

 

 

(77

)

 

-0.7

%

 

 

(183

)

 

-1.7

%

Amortization of acquisition-related intangible assets

 

 

(513

)

 

-4.9

%

 

 

(585

)

 

-5.4

%

Consolidated GAAP operating income

 

$

1,820

 

 

17.3

%

 

$

1,578

 

 

14.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Adjusted results in 2024 and 2023 exclude charges for inventory write-downs associated with large-scale abandonment of product lines. Adjusted results in 2023 exclude $11 of charges for the sale of inventory revalued at the date of acquisition and $5 of accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations.

(b) Adjusted results in 2024 and 2023 exclude certain third-party expenses, principally transaction/integration costs related to recent acquisitions, and charges/credits for changes in estimates of contingent acquisition consideration.

(c) Adjusted results in 2024 and 2023 exclude restructuring and other costs consisting principally of severance, impairments of long-lived assets, net charges for pre-acquisition litigation and other matters, and abandoned facility and other expenses of headcount reductions and real estate consolidations. Adjusted results in 2023 also exclude $26 of contract termination costs associated with facility closures.

(d) Adjusted results in 2024 and 2023 exclude net gains/losses on investments.

(e) Adjusted results in 2024 and 2023 exclude incremental tax impacts for the reconciling items between GAAP and adjusted net income, incremental tax impacts as a result of tax rate/law changes, and the tax impacts from audit settlements.

(f) Adjusted results exclude the incremental impacts for the reconciling items between GAAP and adjusted net income attributable to noncontrolling interests.

Note:

Consolidated depreciation expense is $276 and $270 in 2024 and 2023, respectively.

Organic and Core organic revenue growth

 

Three months ended

 

 

 

June 29, 2024

 

Revenue growth

 

-1 %

 

Acquisitions

 

0 %

 

Currency translation

 

-1 %

 

Organic revenue growth (non-GAAP measure)

 

-1 %

 

COVID-19 testing revenue

 

-1 %

 

Core organic revenue growth (non-GAAP measure)

 

0 %

 

 

 

 

 

Note:

 

For more information related to non-GAAP financial measures, refer to the section titled “Supplemental Information Regarding Non-GAAP Financial Measures” of this release.

 

Condensed Consolidated Statements of Income (unaudited)

 

 

 

 

 

 

 

 

 

 

Six months ended

 

 

June 29,

 

% of

 

July 1,

 

% of

(Dollars in millions except per share amounts)

 

2024

 

Revenues

 

2023

 

Revenues

Revenues

 

$

20,886

 

 

 

 

$

21,397

 

 

 

Costs and operating expenses:

 

 

 

 

 

 

 

 

Cost of revenues (a)

 

 

12,146

 

 

58.2

%

 

 

12,760

 

 

59.6

%

Selling, general and administrative expenses (b)

 

 

3,417

 

 

16.4

%

 

 

3,319

 

 

15.5

%

Amortization of acquisition-related intangible assets

 

 

1,065

 

 

5.1

%

 

 

1,191

 

 

5.5

%

Research and development expenses

 

 

670

 

 

3.2

%

 

 

691

 

 

3.2

%

Restructuring and other costs (c)

 

 

106

 

 

0.5

%

 

 

295

 

 

1.4

%

Total costs and operating expenses

 

 

17,404

 

 

83.3

%

 

 

18,256

 

 

85.3

%

Operating income

 

 

3,483

 

 

16.7

%

 

 

3,141

 

 

14.7

%

Interest income

 

 

574

 

 

 

 

 

324

 

 

 

Interest expense

 

 

(717

)

 

 

 

 

(626

)

 

 

Other income/(expense) (d)

 

 

14

 

 

 

 

 

(46

)

 

 

Income before income taxes

 

 

3,354

 

 

 

 

 

2,793

 

 

 

Provision for income taxes (e)

 

 

(408

)

 

 

 

 

(98

)

 

 

Equity in earnings/(losses) of unconsolidated entities

 

 

(61

)

 

 

 

 

(41

)

 

 

Net income

 

 

2,885

 

 

 

 

 

2,654

 

 

 

Less: net income/(losses) attributable to noncontrolling interests and redeemable noncontrolling interest

 

 

9

 

 

 

 

 

4

 

 

 

Net income attributable to Thermo Fisher Scientific Inc.

 

$

2,875

 

 

13.8

%

 

$

2,650

 

 

12.4

%

 

 

 

 

 

 

 

 

 

Earnings per share attributable to Thermo Fisher Scientific Inc.:

 

 

 

 

 

 

 

 

Basic

 

$

7.53

 

 

 

 

$

6.86

 

 

 

Diluted

 

$

7.50

 

 

 

 

$

6.83

 

 

 

Weighted average shares:

 

 

 

 

 

 

 

 

Basic

 

 

382

 

 

 

 

 

386

 

 

 

Diluted

 

 

383

 

 

 

 

 

388

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted operating income and adjusted operating margin

 

 

 

 

 

 

 

 

GAAP operating income

 

$

3,483

 

 

16.7

%

 

$

3,141

 

 

14.7

%

Cost of revenues adjustments (a)

 

 

17

 

 

0.1

%

 

 

59

 

 

0.3

%

Selling, general and administrative expenses adjustments (b)

 

 

(45

)

 

-0.2

%

 

 

14

 

 

0.1

%

Restructuring and other costs (c)

 

 

106

 

 

0.5

%

 

 

295

 

 

1.4

%

Amortization of acquisition-related intangible assets

 

 

1,065

 

 

5.1

%

 

 

1,191

 

 

5.5

%

Adjusted operating income (non-GAAP measure)

 

$

4,625

 

 

22.1

%

 

$

4,700

 

 

22.0

%

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted net income

 

 

 

 

 

 

 

 

GAAP net income attributable to Thermo Fisher Scientific Inc.

 

$

2,875

 

 

 

 

$

2,650

 

 

 

Cost of revenues adjustments (a)

 

 

17

 

 

 

 

 

59

 

 

 

Selling, general and administrative expenses adjustments (b)

 

 

(45

)

 

 

 

 

14

 

 

 

Restructuring and other costs (c)

 

 

106

 

 

 

 

 

295

 

 

 

Amortization of acquisition-related intangible assets

 

 

1,065

 

 

 

 

 

1,191

 

 

 

Other income/expense adjustments (d)

 

 

(11

)

 

 

 

 

45

 

 

 

Provision for income taxes adjustments (e)

 

 

(51

)

 

 

 

 

(342

)

 

 

Equity in earnings/losses of unconsolidated entities

 

 

61

 

 

 

 

 

41

 

 

 

Noncontrolling interests adjustments (f)

 

 

(1

)

 

 

 

 

 

 

 

Adjusted net income (non-GAAP measure)

 

$

4,016

 

 

 

 

$

3,953

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted earnings per share

 

 

 

 

 

 

 

 

GAAP diluted EPS attributable to Thermo Fisher Scientific Inc.

 

$

7.50

 

 

 

 

$

6.83

 

 

 

Cost of revenues adjustments (a)

 

 

0.04

 

 

 

 

 

0.15

 

 

 

Selling, general and administrative expenses adjustments (b)

 

 

(0.12

)

 

 

 

 

0.03

 

 

 

Restructuring and other costs (c)

 

 

0.28

 

 

 

 

 

0.76

 

 

 

Amortization of acquisition-related intangible assets

 

 

2.78

 

 

 

 

 

3.07

 

 

 

Other income/expense adjustments (d)

 

 

(0.03

)

 

 

 

 

0.11

 

 

 

Provision for income taxes adjustments (e)

 

 

(0.13

)

 

 

 

 

(0.88

)

 

 

Equity in earnings/losses of unconsolidated entities

 

 

0.16

 

 

 

 

 

0.11

 

 

 

Noncontrolling interests adjustments (f)

 

 

0.00

 

 

 

 

 

0.00

 

 

 

Adjusted EPS (non-GAAP measure)

 

$

10.47

 

 

 

 

$

10.18

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of adjusted free cash flow

 

 

 

 

 

 

 

 

GAAP net cash provided by operating activities

 

$

3,211

 

 

 

 

$

2,269

 

 

 

Purchases of property, plant and equipment

 

 

(648

)

 

 

 

 

(742

)

 

 

Proceeds from sale of property, plant and equipment

 

 

20

 

 

 

 

 

10

 

 

 

Free cash flow (non-GAAP measure)

 

$

2,583

 

 

 

 

$

1,537

 

 

 

Business Segment Information

 

Six months ended

 

 

June 29,

 

% of

 

July 1,

 

% of

(Dollars in millions)

 

2024

 

Revenues

 

2023

 

Revenues

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

Life Sciences Solutions

 

$

4,640

 

 

22.2

%

 

$

5,075

 

 

23.7

%

Analytical Instruments

 

 

3,469

 

 

16.6

%

 

 

3,472

 

 

16.2

%

Specialty Diagnostics

 

 

2,227

 

 

10.7

%

 

 

2,217

 

 

10.4

%

Laboratory Products and Biopharma Services

 

 

11,480

 

 

55.0

%

 

 

11,594

 

 

54.2

%

Eliminations

 

 

(930

)

 

-4.5

%

 

 

(961

)

 

-4.5

%

Consolidated revenues

 

$

20,886

 

 

100.0

%

 

$

21,397

 

 

100.0

%

 

 

 

 

 

 

 

 

 

Segment income and segment income margin

 

 

 

 

 

 

 

 

Life Sciences Solutions

 

$

1,705

 

 

36.7

%

 

$

1,653

 

 

32.6

%

Analytical Instruments

 

 

838

 

 

24.2

%

 

 

853

 

 

24.6

%

Specialty Diagnostics

 

 

593

 

 

26.6

%

 

 

577

 

 

26.0

%

Laboratory Products and Biopharma Services

 

 

1,489

 

 

13.0

%

 

 

1,617

 

 

14.0

%

Subtotal reportable segments

 

 

4,625

 

 

22.1

%

 

 

4,700

 

 

22.0

%

Cost of revenues adjustments (a)

 

 

(17

)

 

-0.1

%

 

 

(59

)

 

-0.3

%

Selling, general and administrative expenses adjustments (b)

 

 

45

 

 

0.2

%

 

 

(14

)

 

-0.1

%

Restructuring and other costs (c)

 

 

(106

)

 

-0.5

%

 

 

(295

)

 

-1.4

%

Amortization of acquisition-related intangible assets

 

 

(1,065

)

 

-5.1

%

 

 

(1,191

)

 

-5.5

%

Consolidated GAAP operating income

 

$

3,483

 

 

16.7

%

 

$

3,141

 

 

14.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Adjusted results in 2024 and 2023 exclude charges for inventory write-downs associated with large-scale abandonment of product lines and accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations. Adjusted results in 2023 exclude $21 of charges for the sale of inventory revalued at the date of acquisition.

(b) Adjusted results in 2024 and 2023 exclude certain third-party expenses, principally transaction/integration costs related to recent acquisitions, and charges/credits for changes in estimates of contingent acquisition consideration.

(c) Adjusted results in 2024 and 2023 exclude restructuring and other costs consisting principally of severance, impairments of long-lived assets, net charges for pre-acquisition litigation and other matters, and abandoned facility and other expenses of headcount reductions and real estate consolidations. Adjusted results in 2023 also exclude $26 of contract termination costs associated with facility closures.

(d) Adjusted results in 2024 and 2023 exclude net gains/losses on investments.

(e) Adjusted results in 2024 and 2023 exclude incremental tax impacts for the reconciling items between GAAP and adjusted net income, incremental tax impacts as a result of tax rate/law changes and the tax impacts from audit settlements.

(f) Adjusted results exclude the incremental impacts for the reconciling items between GAAP and adjusted net income attributable to noncontrolling interests.

 

 

 

 

 

 

 

 

 

Notes:

Consolidated depreciation expense is $562 and $523 in 2024 and 2023, respectively.

For more information related to non-GAAP financial measures, refer to the section titled “Supplemental Information Regarding Non-GAAP Financial Measures” of this release.

Condensed Consolidated Balance Sheets (unaudited)

 

 

 

 

 

 

 

 

 

 

 

June 29,

 

December 31,

(In millions)

 

2024

 

2023

 

 

 

 

 

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

7,073

 

$

8,077

Short-term investments

 

 

1,750

 

 

3

Accounts receivable, net

 

 

7,943

 

 

8,221

Inventories

 

 

5,198

 

 

5,088

Other current assets

 

 

3,512

 

 

3,200

Total current assets

 

 

25,476

 

 

24,589

Property, plant and equipment, net

 

 

9,282

 

 

9,448

Acquisition-related intangible assets, net

 

 

15,519

 

 

16,670

Other assets

 

 

4,377

 

 

3,999

Goodwill

 

 

43,843

 

 

44,020

Total assets

 

$

98,496

 

$

98,726

 

 

 

 

 

Liabilities, redeemable noncontrolling interest and equity

 

 

 

 

Current liabilities:

 

 

 

 

Short-term obligations and current maturities of long-term obligations

 

$

5,121

 

$

3,609

Other current liabilities

 

 

9,651

 

 

10,403

Total current liabilities

 

 

14,772

 

 

14,012

Other long-term liabilities

 

 

5,907

 

 

6,564

Long-term obligations

 

 

30,284

 

 

31,308

Redeemable noncontrolling interest

 

 

115

 

 

118

Total equity

 

 

47,419

 

 

46,724

Total liabilities, redeemable noncontrolling interest and equity

 

$

98,496

 

$

98,726

Condensed Consolidated Statements of Cash Flows (unaudited)

 

 

 

 

 

 

 

 

 

 

 

Six months ended

 

 

June 29,

 

July 1,

(In millions)

 

2024

 

2023

 

 

 

 

 

Operating activities

 

 

 

 

Net income

 

$

2,885

 

 

$

2,654

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization

 

 

1,626

 

 

 

1,714

 

Change in deferred income taxes

 

 

(607

)

 

 

(328

)

Other non-cash expenses, net

 

 

311

 

 

 

480

 

Changes in assets and liabilities, excluding the effects of acquisitions

 

 

(1,003

)

 

 

(2,251

)

Net cash provided by operating activities

 

 

3,211

 

 

 

2,269

 

 

 

 

 

 

Investing activities

 

 

 

 

Purchases of property, plant and equipment

 

 

(648

)

 

 

(742

)

Proceeds from sale of property, plant and equipment

 

 

20

 

 

 

10

 

Proceeds from cross-currency interest rate swap interest settlements

 

 

111

 

 

 

35

 

Acquisitions, net of cash acquired

 

 

 

 

 

(2,751

)

Purchases of investments

 

 

(1,778

)

 

 

(188

)

Other investing activities, net

 

 

12

 

 

 

51

 

Net cash used in investing activities

 

 

(2,283

)

 

 

(3,585

)

 

 

 

 

 

Financing activities

 

 

 

 

Net proceeds from issuance of debt

 

 

1,204

 

 

 

 

Repayment of debt

 

 

 

 

 

(1,000

)

Net proceeds from issuance of commercial paper

 

 

 

 

 

1,620

 

Repayment of commercial paper

 

 

 

 

 

(1,441

)

Purchases of company common stock

 

 

(3,000

)

 

 

(3,000

)

Dividends paid

 

 

(284

)

 

 

(252

)

Other financing activities, net

 

 

145

 

 

 

24

 

Net cash used in financing activities

 

 

(1,936

)

 

 

(4,049

)

 

 

 

 

 

Exchange rate effect on cash

 

 

7

 

 

 

(19

)

Decrease in cash, cash equivalents and restricted cash

 

 

(1,000

)

 

 

(5,384

)

Cash, cash equivalents and restricted cash at beginning of period

 

 

8,097

 

 

 

8,537

 

Cash, cash equivalents and restricted cash at end of period

 

$

7,097

 

 

$

3,153

 

 

 

 

 

 

Free cash flow (non-GAAP measure)

 

$

2,583

 

 

$

1,537

 

 

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