LEASES

12 Months Ended

Dec. 31, 2025

Leases [Abstract]

LEASES

LEASES

Lessee Activity

We have entered into operating and finance leases primarily for office, manufacturing, warehouse and R&D facilities, vehicles and equipment. Our leases have remaining terms from one to 37 years and some of those leases include options that provide us with the ability to extend the lease term for periods ranging from one to 10 years. Such options are included in the lease term when it is reasonably certain that the option will be exercised.

Certain of our leases include provisions for variable lease payments which are based on, but not limited to, maintenance, insurance, taxes, index escalations and usage-based amounts. For all asset classes, we have elected to apply a practical expedient to account for other services within lease contracts as components of the lease. We also have elected to apply a practical expedient for short-term leases whereby we do not recognize a lease liability and right-of-use asset for leases with a term of less than 12 months.

We classify our leases as operating or finance at the lease commencement date. Finance leases are generally those leases for which we will pay substantially all of the underlying asset’s fair value or will use the asset for all or a major part of its economic life, including circumstances in which we will ultimately own the asset. All other leases are operating leases. For finance leases, we recognize interest expense using the effective interest method and we recognize amortization expense on the right-of-use asset over the shorter of the lease term or the useful life of the asset. For operating leases, we recognize lease cost on a straight-line basis over the term of the lease.

Lease liabilities and right-of-use assets are recognized at the lease commencement date based on the present value of minimum lease payments over the lease term. We determine the present value of payments under a lease based on our incremental borrowing rate as of the lease commencement date. The incremental borrowing rate is equal to the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.

The components of lease cost for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Operating lease cost	$	88	$	89	$	94
Finance lease cost
Amortization of right-of-use assets	3		4		3
Interest on lease liabilities	1		1		1
Variable lease cost	40		54		45
Lease cost	$	132	$	148	$	143

The following table contains supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023:

(in millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	102	$	100	$	115
Operating cash flows from finance leases	3		5		3
Financing cash flows from finance leases	1		2		1
Right-of-use operating lease assets obtained in exchange for lease obligations	36		64		66
Right-of-use finance lease assets obtained in exchange for lease obligations	4		1		15

Supplemental balance sheet information related to leases as of December 31, 2025 and 2024 include:

(in millions)	2025		2024
Operating leases
Operating lease right-of-use assets	$	276	$	306
Accrued expenses and other current liabilities	$	81	$	80
Operating lease liabilities	223		243
Total operating lease liabilities	$	304	$	323
Finance leases
Property, plant and equipment, at cost	$	39	$	33
Accumulated depreciation	(18)		(15)
Property, plant and equipment, net	$	21	$	18
Current maturities of long-term debt and finance lease obligations	$	2	$	2
Long-term debt and finance lease obligations	21		19
Total finance lease liabilities	$	23	$	21

Lease term and discount rates as of December 31, 2025 and 2024 were:

	December 31, 2025		December 31, 2024
Weighted-average remaining lease term (years)
Operating leases	5		6
Finance leases	7		8
Weighted-average discount rate
Operating leases	3.6	%	3.1	%
Finance leases	4.5	%	4.2	%

Maturities of operating and finance lease liabilities as of December 31, 2025 were:

(in millions)	Finance Leases		Operating Leases
2026	$	4	$	93
2027	4		77
2028	4		53
2029	4		34
2030	4		20
Thereafter	10		60
Total minimum lease payments	30		337
Less: imputed interest	(7)		(33)
Present value of lease liabilities	$	23	$	304

Lessor Activity

We lease medical equipment, such as smart beds and infusion pumps, to customers, often in conjunction with arrangements to provide consumable medical products such as IV fluids and inhaled anesthetics. Certain of our equipment leases are classified as sales-type leases and the remainder are operating leases. The terms of the related contracts, including the proportion of fixed versus variable payments and any options to shorten or extend the lease term, vary by customer. We allocate revenue between equipment leases and medical products based on their standalone selling prices.

The components of lease revenue for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Sales-type lease revenue	$	8	$	10	$	7
Operating lease revenue	350		380		397
Variable lease revenue	27		28		21
Total lease revenue	$	385	$	418	$	425

The components of our net investment in sales-type leases as of December 31, 2025 and 2024 were:

(in millions)	2025		2024
Minimum lease payments	$	30	$	38
Unguaranteed residual values	—		(1)
Net investment in leases	$	30	$	37

Our net investment in sales-type leases is classified as follows in the accompanying consolidated balance sheets as of December 31, 2025 and 2024:

(in millions)	2025		2024
Accounts receivable, net	$	11	$	15
Other non-current assets	19		22
Total	$	30	$	37

Our net investment in sales-type leases was $30 million as of December 31, 2025, of which $1 million originated in 2021 and prior, $5 million in 2022, $6 million in 2023, $10 million in 2024 and $8 million in 2025.

Maturities of sales-type and operating leases as of December 31, 2025 were:

(in millions)	Sales-type Leases1		Operating Leases
2026	$	15	$	9
2027	9		9
2028	5		6
2029	3		3
2030	—		1
Thereafter	—		—
Total minimum lease payments	$	32	$	28

1 Unamortized imputed interest on minimum lease payments was $2 million as of December 31, 2025.

LEASES

LEASES

Lessee Activity

We have entered into operating and finance leases primarily for office, manufacturing, warehouse and R&D facilities, vehicles and equipment. Our leases have remaining terms from one to 37 years and some of those leases include options that provide us with the ability to extend the lease term for periods ranging from one to 10 years. Such options are included in the lease term when it is reasonably certain that the option will be exercised.

Certain of our leases include provisions for variable lease payments which are based on, but not limited to, maintenance, insurance, taxes, index escalations and usage-based amounts. For all asset classes, we have elected to apply a practical expedient to account for other services within lease contracts as components of the lease. We also have elected to apply a practical expedient for short-term leases whereby we do not recognize a lease liability and right-of-use asset for leases with a term of less than 12 months.

We classify our leases as operating or finance at the lease commencement date. Finance leases are generally those leases for which we will pay substantially all of the underlying asset’s fair value or will use the asset for all or a major part of its economic life, including circumstances in which we will ultimately own the asset. All other leases are operating leases. For finance leases, we recognize interest expense using the effective interest method and we recognize amortization expense on the right-of-use asset over the shorter of the lease term or the useful life of the asset. For operating leases, we recognize lease cost on a straight-line basis over the term of the lease.

Lease liabilities and right-of-use assets are recognized at the lease commencement date based on the present value of minimum lease payments over the lease term. We determine the present value of payments under a lease based on our incremental borrowing rate as of the lease commencement date. The incremental borrowing rate is equal to the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.

The components of lease cost for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Operating lease cost	$	88	$	89	$	94
Finance lease cost
Amortization of right-of-use assets	3		4		3
Interest on lease liabilities	1		1		1
Variable lease cost	40		54		45
Lease cost	$	132	$	148	$	143

The following table contains supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023:

(in millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	102	$	100	$	115
Operating cash flows from finance leases	3		5		3
Financing cash flows from finance leases	1		2		1
Right-of-use operating lease assets obtained in exchange for lease obligations	36		64		66
Right-of-use finance lease assets obtained in exchange for lease obligations	4		1		15

Supplemental balance sheet information related to leases as of December 31, 2025 and 2024 include:

(in millions)	2025		2024
Operating leases
Operating lease right-of-use assets	$	276	$	306
Accrued expenses and other current liabilities	$	81	$	80
Operating lease liabilities	223		243
Total operating lease liabilities	$	304	$	323
Finance leases
Property, plant and equipment, at cost	$	39	$	33
Accumulated depreciation	(18)		(15)
Property, plant and equipment, net	$	21	$	18
Current maturities of long-term debt and finance lease obligations	$	2	$	2
Long-term debt and finance lease obligations	21		19
Total finance lease liabilities	$	23	$	21

Lease term and discount rates as of December 31, 2025 and 2024 were:

	December 31, 2025		December 31, 2024
Weighted-average remaining lease term (years)
Operating leases	5		6
Finance leases	7		8
Weighted-average discount rate
Operating leases	3.6	%	3.1	%
Finance leases	4.5	%	4.2	%

Maturities of operating and finance lease liabilities as of December 31, 2025 were:

(in millions)	Finance Leases		Operating Leases
2026	$	4	$	93
2027	4		77
2028	4		53
2029	4		34
2030	4		20
Thereafter	10		60
Total minimum lease payments	30		337
Less: imputed interest	(7)		(33)
Present value of lease liabilities	$	23	$	304

Lessor Activity

We lease medical equipment, such as smart beds and infusion pumps, to customers, often in conjunction with arrangements to provide consumable medical products such as IV fluids and inhaled anesthetics. Certain of our equipment leases are classified as sales-type leases and the remainder are operating leases. The terms of the related contracts, including the proportion of fixed versus variable payments and any options to shorten or extend the lease term, vary by customer. We allocate revenue between equipment leases and medical products based on their standalone selling prices.

The components of lease revenue for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Sales-type lease revenue	$	8	$	10	$	7
Operating lease revenue	350		380		397
Variable lease revenue	27		28		21
Total lease revenue	$	385	$	418	$	425

The components of our net investment in sales-type leases as of December 31, 2025 and 2024 were:

(in millions)	2025		2024
Minimum lease payments	$	30	$	38
Unguaranteed residual values	—		(1)
Net investment in leases	$	30	$	37

Our net investment in sales-type leases is classified as follows in the accompanying consolidated balance sheets as of December 31, 2025 and 2024:

(in millions)	2025		2024
Accounts receivable, net	$	11	$	15
Other non-current assets	19		22
Total	$	30	$	37

Our net investment in sales-type leases was $30 million as of December 31, 2025, of which $1 million originated in 2021 and prior, $5 million in 2022, $6 million in 2023, $10 million in 2024 and $8 million in 2025.

Maturities of sales-type and operating leases as of December 31, 2025 were:

(in millions)	Sales-type Leases1		Operating Leases
2026	$	15	$	9
2027	9		9
2028	5		6
2029	3		3
2030	—		1
Thereafter	—		—
Total minimum lease payments	$	32	$	28

1 Unamortized imputed interest on minimum lease payments was $2 million as of December 31, 2025.

LEASES

LEASES

Lessee Activity

We have entered into operating and finance leases primarily for office, manufacturing, warehouse and R&D facilities, vehicles and equipment. Our leases have remaining terms from one to 37 years and some of those leases include options that provide us with the ability to extend the lease term for periods ranging from one to 10 years. Such options are included in the lease term when it is reasonably certain that the option will be exercised.

Certain of our leases include provisions for variable lease payments which are based on, but not limited to, maintenance, insurance, taxes, index escalations and usage-based amounts. For all asset classes, we have elected to apply a practical expedient to account for other services within lease contracts as components of the lease. We also have elected to apply a practical expedient for short-term leases whereby we do not recognize a lease liability and right-of-use asset for leases with a term of less than 12 months.

We classify our leases as operating or finance at the lease commencement date. Finance leases are generally those leases for which we will pay substantially all of the underlying asset’s fair value or will use the asset for all or a major part of its economic life, including circumstances in which we will ultimately own the asset. All other leases are operating leases. For finance leases, we recognize interest expense using the effective interest method and we recognize amortization expense on the right-of-use asset over the shorter of the lease term or the useful life of the asset. For operating leases, we recognize lease cost on a straight-line basis over the term of the lease.

Lease liabilities and right-of-use assets are recognized at the lease commencement date based on the present value of minimum lease payments over the lease term. We determine the present value of payments under a lease based on our incremental borrowing rate as of the lease commencement date. The incremental borrowing rate is equal to the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.

The components of lease cost for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Operating lease cost	$	88	$	89	$	94
Finance lease cost
Amortization of right-of-use assets	3		4		3
Interest on lease liabilities	1		1		1
Variable lease cost	40		54		45
Lease cost	$	132	$	148	$	143

The following table contains supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023:

(in millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	102	$	100	$	115
Operating cash flows from finance leases	3		5		3
Financing cash flows from finance leases	1		2		1
Right-of-use operating lease assets obtained in exchange for lease obligations	36		64		66
Right-of-use finance lease assets obtained in exchange for lease obligations	4		1		15

Supplemental balance sheet information related to leases as of December 31, 2025 and 2024 include:

(in millions)	2025		2024
Operating leases
Operating lease right-of-use assets	$	276	$	306
Accrued expenses and other current liabilities	$	81	$	80
Operating lease liabilities	223		243
Total operating lease liabilities	$	304	$	323
Finance leases
Property, plant and equipment, at cost	$	39	$	33
Accumulated depreciation	(18)		(15)
Property, plant and equipment, net	$	21	$	18
Current maturities of long-term debt and finance lease obligations	$	2	$	2
Long-term debt and finance lease obligations	21		19
Total finance lease liabilities	$	23	$	21

Lease term and discount rates as of December 31, 2025 and 2024 were:

	December 31, 2025		December 31, 2024
Weighted-average remaining lease term (years)
Operating leases	5		6
Finance leases	7		8
Weighted-average discount rate
Operating leases	3.6	%	3.1	%
Finance leases	4.5	%	4.2	%

Maturities of operating and finance lease liabilities as of December 31, 2025 were:

(in millions)	Finance Leases		Operating Leases
2026	$	4	$	93
2027	4		77
2028	4		53
2029	4		34
2030	4		20
Thereafter	10		60
Total minimum lease payments	30		337
Less: imputed interest	(7)		(33)
Present value of lease liabilities	$	23	$	304

Lessor Activity

We lease medical equipment, such as smart beds and infusion pumps, to customers, often in conjunction with arrangements to provide consumable medical products such as IV fluids and inhaled anesthetics. Certain of our equipment leases are classified as sales-type leases and the remainder are operating leases. The terms of the related contracts, including the proportion of fixed versus variable payments and any options to shorten or extend the lease term, vary by customer. We allocate revenue between equipment leases and medical products based on their standalone selling prices.

The components of lease revenue for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Sales-type lease revenue	$	8	$	10	$	7
Operating lease revenue	350		380		397
Variable lease revenue	27		28		21
Total lease revenue	$	385	$	418	$	425

The components of our net investment in sales-type leases as of December 31, 2025 and 2024 were:

(in millions)	2025		2024
Minimum lease payments	$	30	$	38
Unguaranteed residual values	—		(1)
Net investment in leases	$	30	$	37

Our net investment in sales-type leases is classified as follows in the accompanying consolidated balance sheets as of December 31, 2025 and 2024:

(in millions)	2025		2024
Accounts receivable, net	$	11	$	15
Other non-current assets	19		22
Total	$	30	$	37

Our net investment in sales-type leases was $30 million as of December 31, 2025, of which $1 million originated in 2021 and prior, $5 million in 2022, $6 million in 2023, $10 million in 2024 and $8 million in 2025.

Maturities of sales-type and operating leases as of December 31, 2025 were:

(in millions)	Sales-type Leases1		Operating Leases
2026	$	15	$	9
2027	9		9
2028	5		6
2029	3		3
2030	—		1
Thereafter	—		—
Total minimum lease payments	$	32	$	28

1 Unamortized imputed interest on minimum lease payments was $2 million as of December 31, 2025.

LEASES

LEASES

Lessee Activity

We have entered into operating and finance leases primarily for office, manufacturing, warehouse and R&D facilities, vehicles and equipment. Our leases have remaining terms from one to 37 years and some of those leases include options that provide us with the ability to extend the lease term for periods ranging from one to 10 years. Such options are included in the lease term when it is reasonably certain that the option will be exercised.

Certain of our leases include provisions for variable lease payments which are based on, but not limited to, maintenance, insurance, taxes, index escalations and usage-based amounts. For all asset classes, we have elected to apply a practical expedient to account for other services within lease contracts as components of the lease. We also have elected to apply a practical expedient for short-term leases whereby we do not recognize a lease liability and right-of-use asset for leases with a term of less than 12 months.

We classify our leases as operating or finance at the lease commencement date. Finance leases are generally those leases for which we will pay substantially all of the underlying asset’s fair value or will use the asset for all or a major part of its economic life, including circumstances in which we will ultimately own the asset. All other leases are operating leases. For finance leases, we recognize interest expense using the effective interest method and we recognize amortization expense on the right-of-use asset over the shorter of the lease term or the useful life of the asset. For operating leases, we recognize lease cost on a straight-line basis over the term of the lease.

Lease liabilities and right-of-use assets are recognized at the lease commencement date based on the present value of minimum lease payments over the lease term. We determine the present value of payments under a lease based on our incremental borrowing rate as of the lease commencement date. The incremental borrowing rate is equal to the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.

The components of lease cost for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Operating lease cost	$	88	$	89	$	94
Finance lease cost
Amortization of right-of-use assets	3		4		3
Interest on lease liabilities	1		1		1
Variable lease cost	40		54		45
Lease cost	$	132	$	148	$	143

The following table contains supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023:

(in millions)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	102	$	100	$	115
Operating cash flows from finance leases	3		5		3
Financing cash flows from finance leases	1		2		1
Right-of-use operating lease assets obtained in exchange for lease obligations	36		64		66
Right-of-use finance lease assets obtained in exchange for lease obligations	4		1		15

Supplemental balance sheet information related to leases as of December 31, 2025 and 2024 include:

(in millions)	2025		2024
Operating leases
Operating lease right-of-use assets	$	276	$	306
Accrued expenses and other current liabilities	$	81	$	80
Operating lease liabilities	223		243
Total operating lease liabilities	$	304	$	323
Finance leases
Property, plant and equipment, at cost	$	39	$	33
Accumulated depreciation	(18)		(15)
Property, plant and equipment, net	$	21	$	18
Current maturities of long-term debt and finance lease obligations	$	2	$	2
Long-term debt and finance lease obligations	21		19
Total finance lease liabilities	$	23	$	21

Lease term and discount rates as of December 31, 2025 and 2024 were:

	December 31, 2025		December 31, 2024
Weighted-average remaining lease term (years)
Operating leases	5		6
Finance leases	7		8
Weighted-average discount rate
Operating leases	3.6	%	3.1	%
Finance leases	4.5	%	4.2	%

Maturities of operating and finance lease liabilities as of December 31, 2025 were:

(in millions)	Finance Leases		Operating Leases
2026	$	4	$	93
2027	4		77
2028	4		53
2029	4		34
2030	4		20
Thereafter	10		60
Total minimum lease payments	30		337
Less: imputed interest	(7)		(33)
Present value of lease liabilities	$	23	$	304

Lessor Activity

We lease medical equipment, such as smart beds and infusion pumps, to customers, often in conjunction with arrangements to provide consumable medical products such as IV fluids and inhaled anesthetics. Certain of our equipment leases are classified as sales-type leases and the remainder are operating leases. The terms of the related contracts, including the proportion of fixed versus variable payments and any options to shorten or extend the lease term, vary by customer. We allocate revenue between equipment leases and medical products based on their standalone selling prices.

The components of lease revenue for the years ended December 31, 2025, 2024 and 2023 were:

(in millions)	2025		2024		2023
Sales-type lease revenue	$	8	$	10	$	7
Operating lease revenue	350		380		397
Variable lease revenue	27		28		21
Total lease revenue	$	385	$	418	$	425

The components of our net investment in sales-type leases as of December 31, 2025 and 2024 were:

(in millions)	2025		2024
Minimum lease payments	$	30	$	38
Unguaranteed residual values	—		(1)
Net investment in leases	$	30	$	37

Our net investment in sales-type leases is classified as follows in the accompanying consolidated balance sheets as of December 31, 2025 and 2024:

(in millions)	2025		2024
Accounts receivable, net	$	11	$	15
Other non-current assets	19		22
Total	$	30	$	37

Our net investment in sales-type leases was $30 million as of December 31, 2025, of which $1 million originated in 2021 and prior, $5 million in 2022, $6 million in 2023, $10 million in 2024 and $8 million in 2025.

Maturities of sales-type and operating leases as of December 31, 2025 were:

(in millions)	Sales-type Leases1		Operating Leases
2026	$	15	$	9
2027	9		9
2028	5		6
2029	3		3
2030	—		1
Thereafter	—		—
Total minimum lease payments	$	32	$	28

1 Unamortized imputed interest on minimum lease payments was $2 million as of December 31, 2025.