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, 2024


☐			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.)

1941 Stryker Way

Portage,

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
0.250% Notes due 2024	SYK24A	New York Stock Exchange
2.125% Notes due 2027	SYK27	New York Stock Exchange
3.375% Notes due 2028	SYK28	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
3.375% Notes due 2032	SYK32	New York Stock Exchange
3.625% Notes due 2036	SYK36	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 381,215,773 shares of Common Stock, $0.10 par value, on September 30, 2024.


STRYKER CORPORATION						2024 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
	2024		2023		2024		2023
Net sales	$	5,494	$	4,909	$	16,159	$	14,683
Cost of sales	1,977		1,751		5,893		5,328
Gross profit	$	3,517	$	3,158	$	10,266	$	9,355
Research, development and engineering expenses	377		353		1,108		1,038
Selling, general and administrative expenses	1,896		1,710		5,583		5,200

Amortization of intangible assets	159		164		467		486

Total operating expenses	$	2,432	$	2,227	$	7,158	$	6,724
Operating income	$	1,085	$	931	$	3,108	$	2,631
Other income (expense), net	(42)		(62)		(144)		(184)
Earnings before income taxes	$	1,043	$	869	$	2,964	$	2,447
Income taxes	209		177		517		425
Net earnings	$	834	$	692	$	2,447	$	2,022

Net earnings per share of common stock:
Basic	$	2.18	$	1.82	$	6.42	$	5.33
Diluted	$	2.16	$	1.80	$	6.35	$	5.27

Weighted-average shares outstanding (in millions):
Basic	381.1		379.8		380.9		379.5
Effect of dilutive employee stock compensation	4.5		4.2		4.5		4.2
Diluted	385.6		384.0		385.4		383.7

Cash dividends declared per share of common stock	$	0.80	$	0.75	$	2.40	$	2.25

Anti-dilutive shares excluded from the calculation of dilutive employee stock options were de minimis in all periods.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)


	Three Months				Nine Months
	2024		2023		2024		2023
Net earnings	$	834	$	692	$	2,447	$	2,022
Other comprehensive income (loss), net of tax:
Marketable securities	—		—		—		—
Pension plans	(2)		(1)		(1)		(4)
Unrealized gains (losses) on designated hedges	(27)		2		(28)		4
Financial statement translation	(161)		80		(100)		(28)
Total other comprehensive income (loss), net of tax	$	(190)	$	81	$	(129)	$	(28)
Comprehensive income	$	644	$	773	$	2,318	$	1,994

See accompanying notes to Consolidated Financial Statements.


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

CONSOLIDATED BALANCE SHEETS


	September 30		December 31
	2024		2023
	(Unaudited)
Assets
Current assets
Cash and cash equivalents	$	3,850	$	2,971
Short-term investments	750		—
Marketable securities	84		82
Accounts receivable, less allowance of $200 ($182 in 2023)	3,736		3,765
Inventories:
Materials and supplies	1,234		1,242
Work in process	391		330
Finished goods	3,667		3,271
Total inventories	$	5,292	$	4,843
Prepaid expenses and other current assets	961		857
Total current assets	$	14,673	$	12,518
Property, plant and equipment:
Land, buildings and improvements	1,729		1,692
Machinery and equipment	5,160		4,652
Total property, plant and equipment	$	6,889	$	6,344
Less allowance for depreciation	3,460		3,129
Property, plant and equipment, net	$	3,429	$	3,215
Goodwill	16,396		15,243
Other intangibles, net	4,940		4,593
Noncurrent deferred income tax assets	1,562		1,670
Other noncurrent assets	2,833		2,673
Total assets	$	43,833	$	39,912

Liabilities and shareholders' equity
Current liabilities
Accounts payable	$	1,337	$	1,517
Accrued compensation	1,250		1,478
Income taxes	394		391
Dividends payable	305		304
Accrued expenses and other liabilities	2,224		2,137
Current maturities of debt	2,159		2,094
Total current liabilities	$	7,669	$	7,921
Long-term debt, excluding current maturities	13,325		10,901
Income taxes	368		567
Other noncurrent liabilities	2,322		1,930
Total liabilities	$	23,684	$	21,319
Shareholders' equity
Common stock, $0.10 par value	38		38
Additional paid-in capital	2,353		2,200
Retained earnings	18,303		16,771
Accumulated other comprehensive loss	(545)		(416)
Total shareholders' equity	$	20,149	$	18,593
Total liabilities and shareholders' equity	$	43,833	$	39,912

See accompanying notes to Consolidated Financial Statements.


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)


	Three Months				Nine Months
	2024		2023		2024		2023
Common stock shares outstanding (in millions)
Beginning	381.1		379.8		380.1		378.7
Issuance of common stock under stock compensation and benefit plans	0.1		0.1		1.1		1.2

Ending	381.2		379.9		381.2		379.9

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	$	2,305	$	2,127	$	2,200	$	2,034
Issuance of common stock under stock compensation and benefit plans	(3)		4		(31)		(16)

Share-based compensation	51		52		184		165
Ending	$	2,353	$	2,183	$	2,353	$	2,183
Retained earnings
Beginning	$	17,774	$	15,526	$	16,771	$	14,765

Net earnings	834		692		2,447		2,022

Cash dividends declared	(305)		(285)		(915)		(854)
Ending	$	18,303	$	15,933	$	18,303	$	15,933
Accumulated other comprehensive income (loss)
Beginning	$	(355)	$	(330)	$	(416)	$	(221)
Other comprehensive income (loss)	(190)		81		(129)		(28)
Ending	$	(545)	$	(249)	$	(545)	$	(249)








Total shareholders' equity	$	20,149	$	17,905	$	20,149	$	17,905

See accompanying notes to Consolidated Financial Statements.


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


	Nine Months
	2024		2023
Operating activities
Net earnings	$	2,447	$	2,022
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	319		292
Amortization of intangible assets	467		486
Asset impairments	21		12
Share-based compensation	184		165
Sale of inventory stepped-up to fair value at acquisition	38		—
Deferred income tax (benefit) expense	(21)		(4)
Changes in operating assets and liabilities:
Accounts receivable	67		266
Inventories	(362)		(922)
Accounts payable	(203)		(118)
Accrued expenses and other liabilities	(224)		149

Income taxes	(236)		(65)
Other, net	(186)		(100)
Net cash provided by operating activities	$	2,311	$	2,183
Investing activities
Acquisitions, net of cash acquired	(1,598)		(390)
Purchases of short-term investments	(750)		—
Purchases of marketable securities	(41)		(41)
Proceeds from sales of marketable securities	40		49
Purchases of property, plant and equipment	(489)		(430)
Proceeds from settlement of net investment hedges	99		—
Other investing, net	42		2
Net cash used in investing activities	$	(2,697)	$	(810)
Financing activities
Proceeds (payments) on short-term borrowings, net	(32)		540
Proceeds from issuance of long-term debt	3,011		—
Payments on long-term debt	(601)		(852)
Payments of dividends	(914)		(854)

Cash paid for taxes from withheld shares	(146)		(121)

Other financing, net	(49)		(21)
Net cash provided by (used in) financing activities	$	1,269	$	(1,308)
Effect of exchange rate changes on cash and cash equivalents	(4)		(49)
Change in cash and cash equivalents	$	879	$	16
Cash and cash equivalents at beginning of period	2,971		1,844
Cash and cash equivalents at end of period	$	3,850	$	1,860

See accompanying notes to Consolidated Financial Statements.


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


STRYKER CORPORATION						2024 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, 2024 and the results of operations for the three and nine months 2024. 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 2023.

New Accounting Pronouncements Not Yet Adopted

In December 2023 the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-09 (Topic 740): Income Taxes: Improvements to Income Tax Disclosures which expands the existing rules on income tax disclosures. This update requires entities to disclose specific categories in the tax rate reconciliation, provide additional information for reconciling items that meet a quantitative threshold and disclose additional information about income taxes paid on an annual basis. The new disclosure requirements are effective for fiscal years beginning after December 15, 2024 and we will adopt this ASU in 2025.

In November 2023 the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures which expands disclosure requirements to require entities to disclose significant segment expenses that are regularly provided to or easily computed from information regularly provided to the chief operating decision maker. This update also requires all annual disclosures currently required by Topic 280 to be disclosed in interim periods. The new disclosure requirements are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. We will adopt this ASU in the fourth quarter 2024.

We evaluate all ASUs issued by the 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.

NOTE 2 - REVENUE RECOGNITION

Our policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for 2023.

We disaggregate our net sales by business 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.

Beginning in the first quarter 2024, a product line previously included in Instruments has been reclassified to Endoscopy to align with a change in our internal reporting structure. We have reflected this change in all historical periods presented.


Net Sales by Business
	Three Months				Nine Months
	2024		2023		2024		2023
MedSurg and Neurotechnology:
Instruments	$	679	$	620	$	2,044	$	1,808
Endoscopy	837		746		2,383		2,166
Medical	938		798		2,710		2,417
Neurovascular	329		311		966		906
Neuro Cranial	441		384		1,237		1,112

	$	3,224	$	2,859	$	9,340	$	8,409
Orthopaedics and Spine:
Knees	$	570	$	515	$	1,760	$	1,643
Hips	420		362		1,241		1,130
Trauma and Extremities	849		752		2,511		2,287
Spine	304		291		911		871
Other	127		130		396		343
	$	2,270	$	2,050	$	6,819	$	6,274
Total	$	5,494	$	4,909	$	16,159	$	14,683


Net Sales by Geography
	Three Months 2024				Three Months 2023
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	544	$	135	$	495	$	125
Endoscopy	689		148		618		128
Medical	783		155		660		138
Neurovascular	121		208		120		191
Neuro Cranial	366		75		315		69
	$	2,503	$	721	$	2,208	$	651
Orthopaedics and Spine:
Knees	$	417	$	153	$	385	$	130
Hips	256		164		231		131
Trauma and Extremities	621		228		550		202
Spine	225		79		217		74
Other	87		40		87		43
	$	1,606	$	664	$	1,470	$	580
Total	$	4,109	$	1,385	$	3,678	$	1,231


Net Sales by Geography
	Nine Months 2024				Nine Months 2023
	United States		International		United States		International
MedSurg and Neurotechnology:
Instruments	$	1,640	$	404	$	1,440	$	368
Endoscopy	1,948		435		1,767		399
Medical	2,261		449		1,954		463
Neurovascular	369		597		361		545
Neuro Cranial	1,014		223		910		202
	$	7,232	$	2,108	$	6,432	$	1,977
Orthopaedics and Spine:
Knees	$	1,279	$	481	$	1,207	$	436
Hips	768		473		716		414
Trauma and Extremities	1,842		669		1,663		624
Spine	675		236		650		221
Other	274		122		233		110
	$	4,838	$	1,981	$	4,469	$	1,805
Total	$	12,070	$	4,089	$	10,901	$	3,782

We sell certain customer lease agreements and the related leased assets to third-party financial institutions to accelerate our cash collection cycle. The lease receivables are sold without recourse and are derecognized from our Consolidated Balance Sheets at the time of sale. Under the terms of our arrangements,


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

we collect lease payments on behalf of the financial institutions but maintain no other form of continuing involvement. Sales of these lease agreements are classified as operating activities in our Consolidated Statements of Cash Flows. Fees earned for our servicing activities are immaterial. Revenue related to customer lease agreements sold under these arrangements represented less than 3% of our total revenue for the three and nine months 2024 and 2023.

Contract Assets and Liabilities

On September 30, 2024 and December 31, 2023 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. This occurs primarily when payment is received upfront for certain multi-period extended service contracts. Our contract liabilities of $1,008 and $860 on September 30, 2024 and December 31, 2023 are classified within accrued expenses and other liabilities and other noncurrent liabilities within our Consolidated Balance Sheets based on the timing of when we expect to complete our performance obligations.

Changes in contract liabilities during the nine months 2024 were as follows:


	September 30
	2024
Beginning contract liabilities	$	860
Revenue recognized from beginning of year contract liabilities	(382)

Net advance consideration received during the period	530
Ending contract liabilities	$	1,008

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


Three Months 2024	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	—	$	(27)	$	38	$	(366)	$	(355)
OCI	—		(1)		(28)		(221)		(250)
Income taxes	—		(1)		7		66		72
Reclassifications to:
Cost of sales	—		—		(8)		—		(8)
Other (income) expense, net	—		—		—		(8)		(8)
Income taxes	—		—		2		2		4
Net OCI	$	—	$	(2)	$	(27)	$	(161)	$	(190)
Ending	$	—	$	(29)	$	11	$	(527)	$	(545)


Three Months 2023	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(1)	$	28	$	54	$	(411)	$	(330)
OCI	1		(1)		11		133		144
Income taxes	—		1		(2)		(47)		(48)
Reclassifications to:
Cost of sales	—		—		(7)		—		(7)
Other (income) expense, net	(1)		(1)		(2)		(8)		(12)
Income taxes	—		—		2		2		4
Net OCI	$	—	$	(1)	$	2	$	80	$	81
Ending	$	(1)	$	27	$	56	$	(331)	$	(249)


Nine Months 2024	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	—	$	(28)	$	39	$	(427)	$	(416)
OCI	—		(1)		(4)		(91)		(96)
Income taxes	—		—		—		9		9
Reclassifications to:
Cost of sales	—		—		(28)		—		(28)
Other (income) expense, net	—		—		(3)		(24)		(27)
Income taxes	—		—		7		6		13
Net OCI	$	—	$	(1)	$	(28)	$	(100)	$	(129)
Ending	$	—	$	(29)	$	11	$	(527)	$	(545)


Nine Months 2023	Marketable Securities		Pension Plans		Hedges		Financial Statement Translation		Total
Beginning	$	(1)	$	31	$	52	$	(303)	$	(221)
OCI	—		2		38		10		50
Income taxes	—		(4)		(8)		(19)		(31)
Reclassifications to:
Cost of sales	—		—		(29)		—		(29)
Other (income) expense, net	—		(3)		(4)		(25)		(32)
Income taxes	—		1		7		6		14
Net OCI	$	—	$	(4)	$	4	$	(28)	$	(28)
Ending	$	(1)	$	27	$	56	$	(331)	$	(249)

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 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 2023.

Foreign Currency Hedges


September 2024	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	1,730	$	2,516	$	5,649	$	9,895
Maximum term in years							10.0
Fair value:
Other current assets	$	14	$	—	$	10	$	24
Other noncurrent assets	1		—		—		1
Other current liabilities	(28)		—		(82)		(110)
Other noncurrent liabilities	(3)		(78)		—		(81)
Total fair value	$	(16)	$	(78)	$	(72)	$	(166)


December 2023	Cash Flow		Net Investment		Non-Designated		Total
Gross notional amount	$	1,650	$	1,662	$	4,315	$	7,627
Maximum term in years							2.9
Fair value:
Other current assets	$	24	$	74	$	16	$	114
Other noncurrent assets	2		—		—		2
Other current liabilities	(16)		—		(36)		(52)
Other noncurrent liabilities	(2)		(43)		—		(45)
Total fair value	$	8	$	31	$	(20)	$	19


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

We had €2.3 billion and €1.5 billion at September 30, 2024 and December 31, 2023 in certain forward currency contracts designated as net investment hedges, for which the maximum term is 10 years, 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 €5.0 billion and €4.9 billion at September 30, 2024 and December 31, 2023 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 2024 we settled certain foreign currency forward contracts designated as net investment hedges resulting in cash proceeds of $99. The amounts in AOCI related to settled net investment hedges will remain in AOCI until the hedged investment is either sold or substantially liquidated.

The total after-tax gain (loss) recognized in OCI related to designated net investment hedges was ($67) in the nine months 2024.

Currency Exchange Rate Gains (Losses) Recognized in Net Earnings


		Three Months				Nine Months
Derivative Instrument	Recognized in:	2024		2023		2024		2023
Cash Flow	Cost of sales	$	8	$	7	$	28	$	29
Net Investment	Other income (expense), net	8		8		24		25
Non-Designated	Other income (expense), net	20		4		33		13
	Total	$	36	$	19	$	85	$	67

Pretax gains (losses) on derivatives designated as cash flow hedges of ($4) and net investment hedges of $40 recorded in AOCI are expected to be reclassified to cost of sales and other income (expense), net in earnings within 12 months of September 30, 2024. 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 (losses) of $4 recorded in AOCI related to 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, 2024. 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 2023.

In the nine months 2024 we recorded $204 of contingent consideration related to various acquisitions described in Note 7.

In 2023 we recorded $192 of contingent consideration related to the acquisition of Cerus Endovascular Limited (Cerus) described in Note 7.

There were no significant transfers into or out of any level of the fair value hierarchy in 2024.


Assets Measured at Fair Value	September 30		December 31
	2024		2023
Cash and cash equivalents	$	3,850	$	2,971
Short-term investments	750		—
Trading marketable securities	255		209
Level 1 - Assets	$	4,855	$	3,180
Available-for-sale marketable securities:
Corporate and asset-backed debt securities	$	50	$	43

United States agency debt securities	1		4
United States treasury debt securities	28		31

Certificates of deposit	5		4
Total available-for-sale marketable securities	$	84	$	82
Foreign currency exchange forward contracts	25		116

Level 2 - Assets	$	109	$	198
Total assets measured at fair value	$	4,964	$	3,378


Liabilities Measured at Fair Value	September 30		December 31
	2024		2023
Deferred compensation arrangements	$	255	$	209
Level 1 - Liabilities	$	255	$	209
Foreign currency exchange forward contracts	$	191	$	97

Level 2 - Liabilities	$	191	$	97
Contingent consideration:
Beginning	$	289	$	121
Additions	204		192
Change in estimate and foreign exchange	(11)		(2)
Settlements	(53)		(22)
Ending	$	429	$	289
Level 3 - Liabilities	$	429	$	289
Total liabilities measured at fair value	$	875	$	595


Fair Value of Available for Sale Securities by Maturity
	September 30		December 31
	2024		2023
Due in one year or less	$	41	$	46
Due after one year through three years	$	43	$	36

On September 30, 2024 and December 31, 2023 the aggregate difference between the cost and fair value of available-for-sale marketable securities was nominal. Interest income on cash and cash equivalents, short-term investments and marketable securities income was $30 and $15 in the three months and $92 and $40 in the nine months 2024 and 2023, 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


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

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.

We are currently investigating whether certain business activities in certain foreign countries violated provisions of the Foreign Corrupt Practices Act (FCPA) and have engaged outside counsel to conduct these investigations. We have been contacted by the United States Securities and Exchange Commission, United States Department of Justice and certain other regulatory authorities and are cooperating with these agencies. At this time we are unable to predict the outcome of the investigations or the potential impact, if any, on our financial statements.

We have conducted voluntary recalls of certain products, including our Rejuvenate and ABG II Modular-Neck hip stems and certain lot-specific sizes and offsets of LFIT Anatomic CoCr V40 Femoral Heads. Additionally, we are responsible for certain product liability claims, primarily related to certain hip products sold by Wright Medical Group N.V. (Wright) prior to its 2014 divestiture of the OrthoRecon business.

We have incurred, and expect to incur in the future, costs associated with the defense and settlement of claims and lawsuits. Based on the information that has been received related to the matters discussed above, our accrual for these matters was $185 at September 30, 2024, representing our best estimate 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 30			December 31
	2024			2023
Right-of-use assets	$	516		$	494
Lease liabilities, current	$	149		$	143
Lease liabilities, non-current	$	374		$	356

Other information:
Weighted-average remaining lease term (years)	5.1			5.5
Weighted-average discount rate	3.88		%	3.87		%


	Three Months				Nine Months
	2024		2023		2024		2023
Operating lease cost	$	47	$	48	$	144	$	127

NOTE 7 - ACQUISITIONS

We acquire stock in companies and various assets that continue to support our capital deployment and product development strategies. In the nine months 2024 and 2023 cash paid for acquisitions, net of cash acquired was $1,598 and $390.

In the nine months 2024 we completed various acquisitions for total consideration that includes $1,598 in upfront payments, net of cash acquired, and $395 contingent upon the achievement of certain commercial or clinical milestones. The combined acquisition-date fair values of the contingent milestone payments totaled $204. Goodwill of $615 and $528 was recorded within our Orthopaedics and Spine and our MedSurg and Neurotechnology segments respectively. The acquired companies expand the product portfolios of our Instruments, Endoscopy, Medical and Neuro Cranial businesses within MedSurg and Neurotechnology and our Trauma and Extremities, Joint Replacement and Spine businesses within Orthopaedics and Spine. The purchase price allocation for our acquisitions are based on preliminary valuations, primarily related to developed technology and customer relationships. Goodwill attributable to the acquisitions reflects the strategic benefits of expanding our market presence, diversifying our product portfolio and advancing innovations. This goodwill is not deductible for tax purposes.

In May 2023 we acquired Cerus for net cash consideration of $289 and up to $225 in future milestone payments that had a fair value of $192 at the acquisition date. Cerus designs, develops and manufactures neurovascular products used for the treatment of hemorrhagic stroke. Cerus is part of our Neurovascular business within MedSurg and Neurotechnology. Goodwill attributable to the acquisition is not deductible for tax purposes.

The purchase price allocations for the acquisitions completed in the nine months 2024 and Cerus are:


Purchase Price Allocation of Acquired Net Assets
	2024		2023
	Total		Cerus
Tangible assets acquired:
Accounts receivable	$	36	$	1
Inventory	104		2
Deferred income tax assets	31		4
Other assets	27		1
Debt	(31)		—
Deferred income tax liabilities	(200)		(60)
Other liabilities	(94)		(22)
Intangible assets:
Developed technology	576		240
Customer relationships	202		—
Patents	6		—
Trademarks	2		—
Goodwill	1,143		315
Purchase price, net of cash acquired of $53 and $7	$	1,802	$	481
Weighted average amortization period at acquisition (years):
Developed technologies	12		13
Customer relationships	14		—
Patents	12		—
Trademarks	5		—

The purchase price allocation for Cerus was finalized in the second quarter 2024 with no material adjustments.


Consolidated Estimated Amortization Expense
Remainder of 2024		2025		2026		2027		2028
$	169	$	648	$	592	$	570	$	520


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

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, 2024.

On September 30, 2024 there were no borrowings outstanding under our revolving credit facility or our commercial paper program which allows for maturities up to 397 days from the date of issuance. The maximum amount of our commercial paper that can be outstanding at any time is $2,250.

In May 2024 we repaid the outstanding $600 principal amount of the 3.375% senior unsecured notes due May 15, 2024. In September 2024 we issued $750 of 4.250% senior unsecured notes due September 11, 2029, €800 of 3.375% senior unsecured notes due September 11, 2032, $750 of 4.625% senior unsecured notes due September 11, 2034 and €600 of 3.625% senior unsecured notes due September 11, 2036.


Summary of Total Debt			September 30		December 31
			2024		2023
	Rate	Due
Senior unsecured notes:
	3.375%	May 15, 2024	$	—	$	600
	Floating	November 16, 2024	559		554
	0.250%	December 3, 2024	951		940
	1.150%	June 15, 2025	649		648
	3.375%	November 1, 2025	749		749
	3.500%	March 15, 2026	997		997
	2.125%	November 30, 2027	837		828
	3.650%	March 7, 2028	598		598
	4.850%	December 8, 2028	596		596
	3.375%	December 11, 2028	668		661
	0.750%	March 1, 2029	892		883
	4.250%	September 11, 2029	743		—
	1.950%	June 15, 2030	991		991
	2.625%	November 30, 2030	721		713
	1.000%	December 3, 2031	832		823
	3.375%	September 11, 2032	887		—
	4.625%	September 11, 2034	740		—
	3.625%	September 11, 2036	660		—
	4.100%	April 1, 2043	393		393
	4.375%	May 15, 2044	396		396
	4.625%	March 15, 2046	983		983
	2.900%	June 15, 2050	642		642



Total debt			$	15,484	$	12,995
Less current maturities			2,159		2,094
Total long-term debt			$	13,325	$	10,901

			September 30		December 31
			2024		2023
Unamortized debt issuance costs			$	66	$	50
Borrowing capacity on existing facilities			$	2,159	$	2,160
Fair value of senior unsecured notes			$	14,950	$	12,252

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

NOTE 10 - SEGMENT INFORMATION


	Three Months				Nine Months
	2024		2023		2024		2023
MedSurg and Neurotechnology	$	3,224	$	2,859	$	9,340	$	8,409
Orthopaedics and Spine	2,270		2,050		6,819		6,274
Net sales	$	5,494	$	4,909	$	16,159	$	14,683
MedSurg and Neurotechnology	$	924	$	859	$	2,589	$	2,266
Orthopaedics and Spine	643		499		1,924		1,701
Segment operating income	$	1,567	$	1,358	$	4,513	$	3,967
Items not allocated to segments:
Corporate and other	$	(210)	$	(209)	$	(676)	$	(596)
Acquisition and integration-related costs	(77)		1		(87)		(7)
Amortization of intangible assets	(159)		(164)		(467)		(486)
Structural optimization and other special charges	(24)		(28)		(113)		(142)
Medical device regulations	(13)		(19)		(41)		(74)
Recall-related matters	—		(9)		(22)		(12)
Regulatory and legal matters	1		1		1		(19)

Consolidated operating income	$	1,085	$	931	$	3,108	$	2,631

There were no significant changes to total assets by segment from the information provided in our Annual Report on Form 10-K for 2023.


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q


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

ABOUT STRYKER

Stryker is a global leader in medical technologies and, together with our customers, we are driven to make healthcare better. We offer innovative products and services in MedSurg, Neurotechnology, Orthopaedics and Spine that help improve patient and healthcare outcomes. Alongside our customers around the world, we impact more than 150 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). 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.

Overview of the Three and Nine Months

In the three months 2024 we achieved sales growth of 11.9% from 2023. Excluding the impact of acquisitions and divestitures, sales grew 11.5% in constant currency. We reported operating income margin of 19.7%, net earnings of $834 and net earnings per diluted share of $2.16. Excluding the impact of certain items,

adjusted operating income margin(1) increased by 130 basis points to 24.7%, with adjusted net earnings(1) of $1,107 and adjusted net earnings per diluted share(1) of $2.87, an increase of 16.7% from 2023.

In the nine months 2024 we achieved sales growth of 10.1% from 2023. Excluding the impact of acquisitions and divestitures, sales grew 10.2% in constant currency. We reported operating income margin of 19.2%, net earnings of $2,447 and net earnings per diluted share of $6.35. Excluding the impact of certain items, adjusted operating income margin(1) increased by 70 basis points to 23.7%, with adjusted net earnings(1) of $3,154 and adjusted net earnings per diluted share(1) of $8.18, an increase of 14.6% from 2023.

Recent Developments

In the nine months 2024 we completed various acquisitions for total consideration of $1,598 in upfront payments, net of cash acquired, as well as $395 of contingent consideration if certain commercial or clinical milestones are achieved. Refer to Note 7 to our Consolidated Financial Statements for further information.

In September 2024 we issued $750 of 4.250% senior unsecured notes due September 11, 2029, €800 of 3.375% senior unsecured notes due September 11, 2032, $750 of 4.625% senior unsecured notes due September 11, 2034 and €600 of 3.625% senior unsecured notes due September 11, 2036. Refer to Note 8 to our Consolidated Financial Statements for further information.

(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
	2024		2023		2024		2023		Change		2024		2023		2024		2023		Change
Net sales	$	5,494	$	4,909	100.0	%	100.0	%	11.9	%	$	16,159	$	14,683	100.0	%	100.0	%	10.1	%
Gross profit	3,517		3,158		64.0		64.3		11.4		10,266		9,355		63.5		63.7		9.7
Research, development and engineering expenses	377		353		6.9		7.2		6.8		1,108		1,038		6.9		7.1		6.7
Selling, general and administrative expenses	1,896		1,710		34.5		34.8		10.9		5,583		5,200		34.6		35.4		7.4

Amortization of intangible assets	159		164		2.9		3.3		(3.0)		467		486		2.9		3.3		(3.9)

Other income (expense), net	(42)		(62)		(0.8)		(1.3)		(32.3)		(144)		(184)		(0.9)		(1.3)		(21.7)
Income taxes	209		177		nm		nm		18.1		517		425		nm		nm		21.6
Net earnings	$	834	$	692	15.2	%	14.1	%	20.5	%	$	2,447	$	2,022	15.1	%	13.8	%	21.0	%

Net earnings per diluted share	$	2.16	$	1.80					20.0	%	$	6.35	$	5.27					20.5	%
Adjusted net earnings per diluted share(1)	$	2.87	$	2.46					16.7	%	$	8.18	$	7.14					14.6	%

nm - not meaningful


Geographic and Segment Net Sales	Three Months								Nine Months
					Percentage Change								Percentage Change
	2024		2023		As Reported		Constant Currency		2024		2023		As Reported		Constant Currency
Geographic:
United States	$	4,109	$	3,678	11.7	%	11.7	%	$	12,070	$	10,901	10.7	%	10.7	%
International	1,385		1,231		12.5		13.0		4,089		3,782		8.1		10.1
Total	$	5,494	$	4,909	11.9	%	12.0	%	$	16,159	$	14,683	10.1	%	10.6	%
Segment:
MedSurg and Neurotechnology	$	3,224	$	2,859	12.8	%	12.9	%	$	9,340	$	8,409	11.1	%	11.5	%
Orthopaedics and Spine	2,270		2,050		10.7		10.8		6,819		6,274		8.7		9.2
Total	$	5,494	$	4,909	11.9	%	12.0	%	$	16,159	$	14,683	10.1	%	10.6	%


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q


Supplemental Net Sales Growth Information
	Three Months														Nine Months
					Percentage Change														Percentage Change
									United States		International												United States		International
	2024		2023		As Reported		Constant Currency		As Reported		As Reported		Constant Currency		2024		2023		As Reported		Constant Currency		As Reported		As Reported		Constant Currency
MedSurg and Neurotechnology:
Instruments	$	679	$	620	9.6	%	9.5	%	9.9	%	8.3	%	7.8	%	$	2,044	$	1,808	13.1	%	13.3	%	13.9	%	9.7	%	10.9	%
Endoscopy	837		746		12.2		12.5		11.3		16.6		18.1		2,383		2,166		10.0		10.5		10.2		9.1		11.6
Medical	938		798		17.6		17.7		18.6		12.7		13.2		2,710		2,417		12.1		12.3		15.7		(2.9)		(1.8)
Neurovascular	329		311		5.5		5.9		1.5		8.1		8.6		966		906		6.6		8.3		2.2		9.4		12.4
Neuro Cranial	441		384		15.0		15.0		16.2		9.4		9.6		1,237		1,112		11.3		11.7		11.4		10.7		12.9

	$	3,224	$	2,859	12.8	%	12.9	%	13.3	%	10.9	%	11.4	%	$	9,340	$	8,409	11.1	%	11.5	%	12.4	%	6.7	%	8.7	%
Orthopaedics and Spine:
Knees	$	570	$	515	10.6	%	10.7	%	8.4	%	17.1	%	17.4	%	$	1,760	$	1,643	7.1	%	7.7	%	6.0	%	10.2	%	12.2	%
Hips	420		362		15.9		16.2		10.9		24.8		25.3		1,241		1,130		9.9		10.9		7.3		14.4		17.3
Trauma and Extremities	849		752		12.8		12.6		12.9		12.6		12.0		2,511		2,287		9.8		10.0		10.8		7.1		7.8
Spine	304		291		4.6		4.4		3.5		7.5		6.8		911		871		4.6		4.8		3.9		6.5		7.3
Other	127		130		(2.4)		0.1		(0.6)		(6.1)		1.3		396		343		15.4		17.8		17.4		11.2		18.6
	$	2,270	$	2,050	10.7	%	10.8	%	9.2	%	14.4	%	14.8	%	$	6,819	$	6,274	8.7	%	9.2	%	8.3	%	9.7	%	11.6	%
Total	$	5,494	$	4,909	11.9	%	12.0	%	11.7	%	12.5	%	13.0	%	$	16,159	$	14,683	10.1	%	10.6	%	10.7	%	8.1	%	10.1	%

Note: Beginning in the first quarter 2024, a product line previously included in Instruments has been reclassified to Endoscopy to align with a change in our internal reporting structure. We have reflected this change in all historical periods presented.

Consolidated Net Sales

Consolidated net sales increased 11.9% in the three months 2024 as reported and 12.0% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.1%. Excluding the 0.5% impact of acquisitions and divestitures, net sales in constant currency increased by 10.3% from increased unit volume and 1.2% due to higher prices. The unit volume increase was due to higher product shipments across all MedSurg and Neurotechnology businesses and most Orthopaedics and Spine businesses.

Consolidated net sales increased 10.1% in the nine months 2024 as reported and 10.6% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.5%. Excluding the 0.4% impact of acquisitions and divestitures, net sales in constant currency increased by 9.2% from increased unit volume and 1.0% due to higher prices. The unit volume increase was due to higher product shipments across all MedSurg and Neurotechnology and Orthopaedics and Spine businesses.

MedSurg and Neurotechnology Net Sales

MedSurg and Neurotechnology net sales increased 12.8% in the three months 2024 as reported and 12.9% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.1%. Excluding the 0.2% impact of acquisitions and divestitures, net sales in constant currency increased by 11.0% from increased unit volume and 1.7% from higher prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology businesses.

MedSurg and Neurotechnology net sales increased 11.1% in the nine months 2024 as reported and 11.5% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.4%. Excluding the 0.2% impact of acquisitions and divestitures, net sales in constant currency increased by 9.6% from increased unit volume and 1.7% from higher prices. The unit

volume increase was due to higher shipments across all MedSurg and Neurotechnology businesses.

Orthopaedics and Spine Net Sales

Orthopaedics and Spine net sales increased 10.7% in the three months 2024 as reported and 10.8% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.1%. Excluding the 1.1% impact of acquisitions and divestitures, net sales in constant currency increased 9.3% from increased unit volume and 0.4% from higher prices. The unit volume increase was due to higher shipments across most Orthopaedics and Spine businesses.

Orthopaedics and Spine net sales increased 8.7% in the nine months 2024 as reported and 9.2% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.5%. Excluding the 0.6% impact of acquisitions and divestitures, net sales in constant currency increased 8.6% from increased unit volume. The unit volume increase was due to higher shipments across all Orthopaedics and Spine businesses.

Gross Profit

Gross profit was $3,517 and $3,158 in the three months 2024 and 2023. The key components of the change were:


	Gross Profit Percent Net Sales
Three Months 2023	64.3	%
Sales pricing	40 bps
Volume and mix	60 bps
Manufacturing and supply chain costs	(90) bps
Structural optimization and other special charges	20 bps
Inventory stepped up to fair value	(60) bps


Three Months 2024	64.0	%

Gross profit as a percentage of net sales in the three months 2024 remained relatively flat with 2023.

Gross profit was $10,266 and $9,355 in the nine months 2024 and 2023. The key components of the change were:


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q


	Gross Profit Percent Net Sales
Nine Months 2023	63.7	%
Sales pricing	40 bps
Volume and mix	60 bps
Manufacturing and supply chain costs	(70) bps
Structural optimization and other special charges	(20) bps
Inventory stepped up to fair value	(30) bps


Nine Months 2024	63.5	%

Gross profit as a percentage of net sales in the nine months 2024 remained relatively flat with 2023.

While segment mix was not a significant driver of the change in gross profit as a percent of net sales between the three and nine months 2024 and 2023, we generally expect segment mix to have an unfavorable impact for the foreseeable future as we anticipate more rapid sales growth in our lower gross margin MedSurg and Neurotechnology segment than our Orthopaedics and Spine segment.

Research, Development and Engineering Expenses

Research, development and engineering expenses increased $24 or 6.8% in the three months 2024 and decreased as a percentage of net sales to 6.9% from 7.2% in 2023, primarily due to lower product launch costs.

Research, development and engineering expenses increased $70 or 6.7% in the nine months 2024 and decreased as a percentage of net sales to 6.9% from 7.1% in 2023, primarily due to lower spend on medical device regulations in the European Union.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased $186 or 10.9% in the three months 2024. As a percentage of net sales, expenses decreased to 34.5% from 34.8% in 2023, primarily due to continued spend discipline that was partially offset by higher acquisition-related costs.

Selling, general and administrative expenses increased $383 or 7.4% in the nine months 2024 and decreased as a percentage of net sales to 34.6% from 35.4% in 2023, primarily due to continued spend discipline and lower charges for structural optimization and certain legal matters, offset by higher acquisition-related costs.

Amortization of Intangible Assets

Amortization of intangible assets was $159 and $164 in the three months and $467 and $486 in the nine months 2024 and 2023. Refer to Note 7 to our Consolidated Financial Statements for further information.

Operating Income

Operating income was $1,085 and $931 in the three months 2024 and 2023. Operating income as a percentage of net sales in the three months 2024 increased to 19.7% from 19.0% in 2023. Refer to the discussion above for the primary drivers of the change.

Operating income was $3,108 and $2,631 in the nine months 2024 and 2023. Operating income as a percentage of net sales in the nine months 2024 increased to 19.2% from 17.9% in 2023. Refer to the discussion above for the primary drivers of the change.

MedSurg and Neurotechnology operating income as a percentage of net sales decreased to 28.7% in the three months 2024 from 30.0% in 2023. Orthopaedics and Spine operating income as a percentage of net sales increased to 28.3% in the three months 2024 from 24.3% in 2023. The key components of

the change were:


	Operating Income Percent Net Sales
	MedSurg and Neurotechnology		Orthopaedics and Spine
Three Months 2023	30.0	%	24.3	%
Sales pricing	120 bps		30 bps
Volume	340 bps		530 bps
Manufacturing and supply chain costs	(310) bps		180 bps
Research, development and engineering expenses	(80) bps		(30) bps
Selling, general and administrative expenses	(200) bps		(310) bps
Three Months 2024	28.7	%	28.3	%

The decrease in MedSurg and Neurotechnology operating income as a percentage of net sales for the three months was primarily driven by higher manufacturing and supply chain costs and higher selling, general and administrative expenses partially offset by higher unit volumes and higher prices.

The increase in Orthopaedics and Spine operating income as a percentage of net sales for the three months was primarily driven by higher unit volumes and lower manufacturing and supply chain costs partially offset by higher selling, general and administrative expenses.

MedSurg and Neurotechnology operating income as a percentage of net sales increased to 27.7% in the nine months 2024 from 26.9% in 2023. Orthopaedics and Spine operating income as a percentage of net sales increased to 28.2% in the nine months 2024 from 27.1% in 2023. The key components of the change were:


	Operating Income Percent Net Sales
	MedSurg and Neurotechnology		Orthopaedics and Spine
Nine Months 2023	26.9	%	27.1	%
Sales pricing	130 bps		0 bps
Volume	320 bps		450 bps
Manufacturing and supply chain costs	(80) bps		(40) bps
Research, development and engineering expenses	(90) bps		(60) bps
Selling, general and administrative expenses	(200) bps		(240) bps
Nine Months 2024	27.7	%	28.2	%

The increase in MedSurg and Neurotechnology operating income as a percentage of net sales for the nine months was primarily driven by higher unit volumes and higher prices partially offset by higher selling, general and administrative expenses.

The increase in Orthopaedics and Spine operating income as a percentage of net sales for the nine months was primarily driven by higher sales volume partially offset by higher selling, general and administrative expenses.


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

Other Income (Expense), Net

Other income (expense), net was ($42) and ($62) in the three months and ($144) and ($184) in the nine months 2024 and 2023. The decrease in net expense in the three and nine months 2024 compared to 2023 was primarily due to higher interest income in 2024.

Income Taxes

Our effective tax rates were 20.0% and 17.4% in the three and nine months 2024 and 20.4% and 17.4% in the three and nine months 2023. The effective tax rates for the three and nine months 2024 and 2023 reflect the continued lower effective income tax rates as a result of our European operations and certain discrete tax items. The Organisation for Economic Cooperation and Development (OECD), which represents a coalition of member countries, has put forth two proposed base erosion and profit shifting frameworks that revise the existing profit allocation and nexus rules (Pillar One) and ensure a minimal level of taxation (Pillar Two). On December 12, 2022 the European Union member states agreed to implement the Inclusive Framework’s global corporate minimum tax rate of 15%, and various countries within and outside the European Union have either enacted or proposed new tax laws implementing Pillar Two in 2024. The OECD continues to release additional guidance and we anticipate more countries will enact similar tax laws. Some of the new tax laws are effective in 2024 while others will be effective in future years. These tax law changes and any additional contemplated tax law changes could increase tax expense in future periods.

Net Earnings

Net earnings increased to $834 or $2.16 per diluted share in the three months 2024 from $692 or $1.80 per diluted share in 2023. Net earnings increased to $2,447 or $6.35 per diluted share in the nine months 2024 from $2,022 or $5.27 per diluted share in 2023. Refer to the discussion above for the primary drivers of the change.

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 income taxes; adjusted effective income tax rate; adjusted net earnings; and adjusted net earnings per diluted share (Diluted EPS). 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. The income tax effect of each adjustment was determined based on the tax effect of the jurisdiction in which the related pre-tax adjustment was recorded. 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, employee retention and workforce reductions, manufacturing integration costs and other integration-related activities), changes in the fair value of contingent consideration, amortization of inventory stepped-up to fair value, specific costs (e.g., deal costs and costs associated with legal entity rationalization) related to the consummation of the acquisition process and legal entity rationalization and acquisition-related tax items.

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

3.Structural optimization and other special charges. Costs associated with employee retention and workforce reductions, the closure or transfer of manufacturing and other facilities (e.g., site closure costs, contract termination costs and redundant employee costs during the work transfers), product line exits (primarily inventory, long-lived


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

asset and specifically-identified intangible asset write-offs), certain long-lived and intangible asset write-offs and impairments and other charges.

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. Changes in our best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within a range is not known, to resolve the Rejuvenate, LFIT V40, Wright legacy hip products and other product recalls.

6.Regulatory and legal matters. Changes in our best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within a range is not known, to resolve certain regulatory or other legal matters and the amount of favorable awards from settlements.

7.Tax matters. 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, income taxes, 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 adjusted 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.


Reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measures
Three Months 2024	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Income Taxes		Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	3,517		$	1,896		$	377		$	1,085		$	(42)		$	209	$	834		20.0	%	$	2.16
Reported percent net sales	64.0		%	34.5		%	6.9		%	19.7		%	(0.8)		%	nm		15.2		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	29			—			—			29			—			7		22			0.2		0.06
Other acquisition and integration-related (a)	—			(48)			—			48			—			11		37			0.3		0.10
Amortization of purchased intangible assets	—			—			—			159			—			32		127			0.7		0.32
Structural optimization and other special charges (b)	(2)			(26)			—			24			—			4		20			—		0.05
Medical device regulations (c)	—			—			(13)			13			—			2		11			0.1		0.03
Recall-related matters (d)	—			—			—			—			—			—		—			—		—
Regulatory and legal matters (e)	—			1			—			(1)			—			—		(1)			—		—
Tax matters (f)	—			—			—			—			—			(57)		57			(5.5)		0.15
Adjusted	$	3,544		$	1,823		$	364		$	1,357		$	(42)		$	208	$	1,107		15.8	%	$	2.87
Adjusted percent net sales	64.5		%	33.2		%	6.6		%	24.7		%	(0.8)		%	nm		20.1		%


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q


Three Months 2023	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Income Taxes		Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	3,158		$	1,710		$	353		$	931		$	(62)		$	177	$	692		20.4	%	$	1.80
Reported percent net sales	64.3		%	34.8		%	7.2		%	19.0		%	(1.3)		%	nm		14.1		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	—			—			—			—			—			—		—			—		—
Other acquisition and integration-related (a)	—			1			—			(1)			—			(28)		27			(3.1)		0.07
Amortization of purchased intangible assets	—			—			—			164			—			36		128			1.6		0.34
Structural optimization and other special charges (b)	19			(9)			—			28			—			7		21			0.3		0.06
Medical device regulations (c)	1			—			(18)			19			—			4		15			0.2		0.04
Recall-related matters (d)	—			(9)			—			9			—			2		7			0.1		0.01
Regulatory and legal matters (e)	—			1			—			(1)			—			1		(2)			0.1		—
Tax matters (f)	—			—			—			—			1			(55)		56			(6.4)		0.14
Adjusted	$	3,178		$	1,694		$	335		$	1,149		$	(61)		$	144	$	944		13.2	%	$	2.46
Adjusted percent net sales	64.7		%	34.5		%	6.8		%	23.4		%	(1.2)		%	nm		19.2		%

(a) Charges represent certain acquisition and integration-related costs associated with acquisitions, including:


	Three Months
	2024		2023
Termination of sales relationships	$	—	$	2
Employee retention and workforce reductions	13		3
Changes in the fair value of contingent consideration	2		(4)
Manufacturing integration costs	1		—
Stock compensation payments upon a change in control	22		—
Other integration-related activities	10		(2)
Adjustments to Operating Income	$	48	$	(1)
Charges for acquisition-related tax provisions	—		(28)
Other income taxes related to acquisition and integration-related costs	11		—
Adjustments to Income Taxes	$	11	$	(28)
Adjustments to Net Earnings	$	37	$	27

(b) Structural optimization and other special charges represent the costs associated with:


	Three Months
	2024		2023
Employee retention and workforce reductions	$	12	$	(5)
Closure/transfer of manufacturing and other facilities	2		12
Product line exits	4		7
Certain long-lived and intangible asset write-offs and impairments	12		9
Termination of sales relationships in certain countries	6		—
Other charges	(12)		5
Adjustments to Operating Income	$	24	$	28

Adjustments to Income Taxes	$	4	$	7
Adjustments to Net Earnings	$	20	$	21

(c) Charges represent the costs specific to updating our quality system, product labeling, asset write-offs and product remanufacturing to comply with the medical device reporting regulations and other requirements of the new medical device regulations in the European Union.

(d) Charges represent changes in our best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within a range is not known, to resolve certain recall-related matters.

(e) Charges represent changes in our best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within a range is not known, to resolve certain regulatory or other legal matters and the amount of favorable awards from settlements.

(f) Benefits / (charges) represent the accounting impact of certain significant and discrete tax items, including:


	Three Months
	2024		2023
Adjustments related to the transfer of certain intellectual properties between tax jurisdictions	$	(47)	$	(44)


Other tax matters	(10)		(11)
Adjustments to Income Taxes	$	(57)	$	(55)
Charges / benefits for certain tax audit settlements	—		1

Adjustments to Other Income (Expense), Net	$	—	$	1
Adjustments to Net Earnings	$	57	$	56


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q


Nine Months 2024	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Income Taxes		Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	10,266		$	5,583		$	1,108		$	3,108		$	(144)		$	517	$	2,447		17.4	%	$	6.35
Reported percent net sales	63.5		%	34.6		%	6.9		%	19.2		%	(0.9)		%	nm		15.1		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	38			—			—			38			—			9		29			0.3		0.08
Other acquisition and integration-related (a)	—			(49)			—			49			—			14		35			0.2		0.09
Amortization of purchased intangible assets	—			—			—			467			—			96		371			1.0		0.96
Structural optimization and other special charges (b)	41			(72)			—			113			—			24		89			0.2		0.23
Medical device regulations (c)	5			—			(36)			41			—			9		32			0.1		0.08
Recall-related matters (d)	11			(11)			—			22			—			5		17			0.1		0.04
Regulatory and legal matters (e)	—			1			—			(1)			—			—		(1)			—		—
Tax matters (f)	—			—			—			—			(1)			(136)		135			(4.7)		0.35
Adjusted	$	10,361		$	5,452		$	1,072		$	3,837		$	(145)		$	538	$	3,154		14.6	%	$	8.18
Adjusted percent net sales	64.1		%	33.7		%	6.6		%	23.7		%	(0.9)		%	nm		19.5		%


Nine Months 2023	Gross Profit			Selling, General & Administrative Expenses			Research, Development & Engineering Expenses			Operating Income			Other Income (Expense), Net			Income Taxes		Net Earnings			Effective Tax Rate		Diluted EPS
Reported	$	9,355		$	5,200		$	1,038		$	2,631		$	(184)		$	425	$	2,022		17.4	%	$	5.27
Reported percent net sales	63.7		%	35.4		%	7.1		%	17.9		%	(1.3)		%	nm		13.8		%
Acquisition and integration-related costs:
Inventory stepped-up to fair value	—			—			—			—			—			—		—			—		—
Other acquisition and integration-related (a)	—			(7)			—			7			—			(25)		32			(1.0)		0.08
Amortization of purchased intangible assets	—			—			—			486			—			104		382			1.5		1.00
Structural optimization and other special charges (b)	30			(112)			—			142			—			32		110			0.5		0.29
Medical device regulations (c)	1			—			(73)			74			—			17		57			0.3		0.15
Recall-related matters (d)	—			(12)			—			12			—			3		9			—		0.02
Regulatory and legal matters (e)	—			(19)			—			19			—			4		15			—		0.04
Tax matters (f)	—			—			—			—			(8)			(121)		113			(4.9)		0.29
Adjusted	$	9,386		$	5,050		$	965		$	3,371		$	(192)		$	439	$	2,740		13.8	%	$	7.14
Adjusted percent net sales	63.9		%	34.4		%	6.6		%	23.0		%	(1.3)		%	nm		18.7		%

(a) Charges represent certain acquisition and integration-related costs associated with acquisitions, including:


	Nine Months
	2024		2023
Termination of sales relationships	$	3	$	2
Employee retention and workforce reductions	17		3
Changes in the fair value of contingent consideration	(12)		(7)
Manufacturing integration costs	2		2
Stock compensation payments upon a change in control	22		—
Other integration-related activities	17		7
Adjustments to Operating Income	$	49	$	7
Charges for acquisition-related tax provisions	—		(28)
Other income taxes related to acquisition and integration-related costs	14		3
Adjustments to Income Taxes	$	14	$	(25)
Adjustments to Net Earnings	$	35	$	32

(b) Structural optimization and other special charges represent the costs associated with:


	Nine Months
	2024		2023
Employee retention and workforce reductions	$	14	$	63
Closure/transfer of manufacturing and other facilities	18		36
Product line exits	19		16
Certain long-lived and intangible asset write-offs and impairments	22		12
Termination of sales relationships in certain countries	7		—
Other charges	33		15
Adjustments to Operating Income	$	113	$	142

Adjustments to Income Taxes	$	24	$	32
Adjustments to Net Earnings	$	89	$	110


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

(f) Benefits / (charges) represent the accounting impact of certain significant and discrete tax items, including:


	Nine Months
	2024		2023
Adjustments related to the transfer of certain intellectual properties between tax jurisdictions	$	(141)	$	(138)
Certain tax audit settlements	(2)		24

Other tax matters	7		(7)
Adjustments to Income Taxes	$	(136)	$	(121)
Charges / benefits for certain tax audit settlements	(1)		(9)
Other tax related adjustments	—		1
Adjustments to Other Income (Expense), Net	$	(1)	$	(8)
Adjustments to Net Earnings	$	135	$	113

FINANCIAL CONDITION AND LIQUIDITY


	Nine Months
Net cash provided by (used in):	2024		2023
Operating activities	$	2,311	$	2,183
Investing activities	(2,697)		(810)
Financing activities	1,269		(1,308)
Effect of exchange rate changes	(4)		(49)
Change in cash and cash equivalents	$	879	$	16

Operating Activities

Cash provided by operating activities was $2,311 and $2,183 in the nine months 2024 and 2023. The increase was primarily due to higher net earnings partially offset by the timing of payments and collections in working capital accounts.

Investing Activities

Cash used in investing activities was $2,697 and $810 in the nine months 2024 and 2023. The nine months 2024 included cash paid for various acquisitions and purchases of short-term investments partially offset by proceeds from the settlement of certain foreign currency forward contracts designated as net investment hedges. The nine months 2023 included cash paid for the Cerus acquisition. Refer to Notes 4 and 7 to our Consolidated Financial Statements for further information on derivative instruments and acquisitions.

Financing Activities

Cash provided by financing activities was $1,269 in the nine months 2024 and cash used in financing activities was $1,308 in the nine months 2023. In 2024, cash provided was primarily driven by proceeds from the issuance of various senior unsecured notes as described in Note 8 to our Consolidated Financial Statements. This was partially offset by the repayment of maturing senior unsecured notes, dividend payments and cash paid for taxes on withheld shares. Cash used in 2023 was primarily driven by dividend payments, repayment of the term loan used to fund the acquisition of Vocera and cash paid for taxes on withheld shares, partially offset by proceeds from the issuance of €500 of floating rate senior notes.

We did not repurchase any shares in the nine months 2024 and 2023.

Liquidity

Cash, cash equivalents, short-term investments and marketable securities were $4,684 and $3,053 on September 30, 2024 and December 31, 2023. Current assets exceeded current liabilities by $7,004 and $4,597 on September 30, 2024 and December 31, 2023. 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 have raised funds in the capital markets and have accessed the credit 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, short-term investments and marketable securities held in locations outside the United States was 14% on September 30, 2024 compared to 25% on December 31, 2023.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

There were no changes to our critical accounting policies and estimates from those disclosed in our Annual Report on Form 10-K for 2023, except as follows.

We test goodwill annually for impairment at October 31 or whenever events or circumstances indicate that goodwill may be impaired. When it is unlikely that goodwill of a reporting unit is impaired, we perform a qualitative assessment that may be periodically supplemented with a corroborative quantitative analysis.

During 2022 we recognized a goodwill impairment charge of $216 for the Spine reporting unit. Due to the impairment charge in 2022, we performed a quantitative impairment test for our Spine reporting unit at October 31, 2023 and determined that its fair value exceeded its carrying amount by 10% and no additional impairment charges were recorded.

The Spine business’s operating results continue to be affected by inflationary pressures and the competitive environment. These inputs were included in the updated projections used in our annual long-range financial plan, which was approved during the third quarter 2024. Additionally, it is likely we will reorganize our Spine reporting unit during the fourth quarter 2024 to separate the spine enabling technologies portfolio (Enabling Technologies) from the spinal implant portfolio (Core Spine). While changes in reporting units are accounted for on a prospective basis, they may be an indicator that goodwill of a reporting unit is potentially impaired. As a result of these factors, we performed a quantitative impairment test of the Spine reporting unit at September 30, 2024. The outcome of the impairment test was that the fair value of the Spine reporting unit exceeded its carrying amount by 9% and we did not record any impairment charges during the quarter ended September 30, 2024. Goodwill attributable to the Spine reporting unit was approximately $1.0 billion at September 30, 2024.

In our quantitative impairment test, the fair value of the Spine reporting unit was determined using a discounted cash flow analysis, which is a form of the income approach. Significant inputs to the analysis included assumptions for future revenue growth, operating margin and the rate used to discount the estimated future cash flows to their present value based on the reporting unit’s estimated weighted average cost of capital. Our assumptions for revenue growth and operating margin considered several operating factors, including surgery volumes, increased costs and our competitive environment. We believe our estimates are appropriate based upon current and anticipated future market conditions and the best information available at the impairment assessment date. However, future impairment charges could be required if our Spine reporting unit does not


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


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

achieve its cash flow, revenue and profitability projections or if there is an increase in the weighted average cost of capital.

The assumptions used in the discounted cash flow analysis are subject to inherent uncertainties and subjectivity. The use of different assumptions, estimates or judgments with respect to the estimation of future cash flows and the determination of the discount rate used to reduce such estimated future cash flows to their net present value could materially affect the determination of any impairment charges. Hypothetical changes in our estimates of the discount rate, long-term revenue growth and long-term operating margin would result in impairment charges as follows:


Change in selected assumption	Percentage decline in fair value		Impairment charge
100 bps increase in discount rate	16	%	$	150
100 bps decrease in long-term revenue growth	11		50
100 bps decrease in long-term operating margin	6		—

During the fourth quarter 2024, it is likely we will reorganize certain of our reporting units, including the Spine reporting unit. Upon a reorganization of our reporting units, the assets (including goodwill) and liabilities will be reassigned to the new reporting units and we will perform a goodwill impairment test immediately before and after the reorganization. We estimate that approximately $265 of goodwill will be assigned to the Core Spine reporting unit upon a reorganization and we expect that a material portion of this balance could be impaired.

Historical impairment assessments for our other reporting units have indicated that their implied fair values exceed their respective carrying amounts by at least 100%. We have not identified any factors in 2024 that would lead us to believe that those reporting units are at risk of a goodwill impairment.

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 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 are based on current projections about operations, industry conditions, financial condition and liquidity. Words that identify forward-looking statements include, without limitation, 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. Therefore, actual results could differ materially and adversely from these forward-looking statements, historical experience or our present expectations. Some important factors that could cause our actual results to differ from our expectations in any forward-looking statements include the risks discussed in Item 1A. "Risk Factors" of our Annual Report on Form 10-K for 2023. 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 2023. While we believe that the assumptions underlying such forward-looking statements are reasonable, there can be no assurance that future events or developments will not cause such statements to be inaccurate. All forward-looking statements contained in this report are qualified in their entirety by this cautionary statement. We expressly 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 operating 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 2023. There were no material changes from the information provided therein.


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, 2024. Based on that evaluation, the Certifying Officers concluded the Company's disclosure controls and procedures were effective as of September 30, 2024.

Changes in Internal Control Over Financial Reporting

There was no change to our internal control over financial reporting during the nine months 2024 that materially affected, or is reasonably likely to materially affect, our 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 2023.


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

In the three months 2024 we did not issue shares of our common stock as performance incentive awards to employees. When issued, 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.


Dollar amounts are in millions except per share amounts or as otherwise specified.			18


STRYKER CORPORATION						2024 Third Quarter Form 10-Q

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 2024 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, 2024.


ITEM 5.			OTHER INFORMATION

Certain of our officers or directors have made elections to participate in, and are participating in, our employee stock purchase plan and 401(k) plan and have made, and may from time to time make, elections to have shares withheld to cover withholding taxes due or pay the exercise price of stock options, restricted stock units and performance stock units, which may constitute non-Rule 10b5–1 trading arrangements (as defined in Item 408(c) of Regulation S-K).


ITEM 6.			EXHIBITS


4(i)			Twenty-Eighth Supplemental Indenture (including the form of 2032 note), dated September 11, 2024, between Stryker Corporation and U.S. Bank Trust Company, National Association, as trustee — Incorporated by reference to Exhibit 4.2 to the Company’s Form 8-K dated September 11, 2024 (Commission File No. 001-13149).
4(ii)			Twenty-Ninth Supplemental Indenture (including the form of 2036 note), dated September 11, 2024, between Stryker Corporation and U.S. Bank Trust Company, National Association, as trustee — Incorporated by reference to Exhibit 4.3 to the Company’s Form 8-K dated September 11, 2024 (Commission File No. 001-13149).
4(iii)			Thirtieth Supplemental Indenture (including the form of 2029 note), dated September 11, 2024, between Stryker Corporation and U.S. Bank Trust Company, National Association, as trustee — Incorporated by reference to Exhibit 4.4 to the Company’s Form 8-K dated September 11, 2024 (Commission File No. 001-13149).
4(iv)			Thirty-First Supplemental Indenture (including the form of 2034 note), dated September 11, 2024, between Stryker Corporation and U.S. Bank Trust Company, National Association, as trustee — Incorporated by reference to Exhibit 4.5 to the Company’s Form 8-K dated September 11, 2024 (Commission File No. 001-13149).
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)


			† Filed with this Form 10-Q
			†† Furnished with this Form 10-Q


		STRYKER CORPORATION
		(Registrant)


Date:	October 30, 2024	/s/ KEVIN A. LOBO
		Kevin A. Lobo
		Chair, Chief Executive Officer and President


Date:	October 30, 2024	/s/ GLENN S. BOEHNLEIN
		Glenn S. Boehnlein
		Vice President, Chief Financial Officer