Segment and Geographic Information

9 Months Ended

Jan. 24, 2020

Segment disclosures are on a performance basis consistent with internal management reporting. Net sales of the Company's reportable segments include end-customer revenues from the sale of products the segment develops, manufactures, and distributes. There are certain corporate and centralized expenses that are not allocated to the segments.

The Company’s management evaluates performance of the segments and allocates resources based on segment operating profit. Segment operating profit represents income before income taxes, excluding interest expense, amortization of intangible assets, centralized distribution costs, non-operating income or expense items, certain corporate charges, and other items not allocated

to the segments. The financial information that is regularly reviewed by the Company's chief operating decision maker to assess performance and allocate resources changed during the first quarter of fiscal year 2020 to remove the impact of non-service pension and post-retirement benefit costs from segment results. This change did not have a material impact on the segment results reviewed. As a result of the change, the Company has revised the disclosure for the prior period to align with the current presentation.

The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies in Note 1 to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended April 26, 2019. Certain depreciable assets may be recorded by one segment, while the depreciation expense is allocated to another segment. The allocation of depreciation expense is based on the proportion of the assets used by each segment.

The following tables present reconciliations of financial information from the segments to the applicable line items in the Company's consolidated financial statements:

Net Sales


	Three months ended⁽¹⁾						Nine months ended⁽¹⁾
(in millions)	January 24, 2020		January 25, 2019		January 24, 2020		January 25, 2019
Cardiac and Vascular Group	$	2,819	$	2,786	$	8,464	$	8,455
Minimally Invasive Therapies Group	2,176		2,124		6,418		6,223
Restorative Therapies Group	2,111		2,026		6,235		5,968
Diabetes Group	610		610		1,798		1,765
Total	$	7,717	$	7,546	$	22,916	$	22,411

(1) The data in this schedule has been intentionally rounded to the nearest million and, therefore, may not sum.

Segment Operating Profit


	Three months ended						Nine months ended
(in millions)	January 24, 2020		January 25, 2019		January 24, 2020		January 25, 2019
Cardiac and Vascular Group	$	1,101	$	1,076	$	3,284	$	3,262
Minimally Invasive Therapies Group	860		828		2,453		2,396
Restorative Therapies Group	898		824		2,531		2,394
Diabetes Group	158		190		456		538
Segment operating profit	3,017		2,918		8,724		8,590
Interest expense	(156)		(243)		(930)		(726)
Other non-operating income, net	96		71		305		309
Amortization of intangible assets	(436)		(436)		(1,317)		(1,327)
Corporate	(348)		(331)		(1,005)		(974)
Centralized distribution costs	(348)		(383)		(1,117)		(1,313)
Restructuring and associated costs	(97)		(66)		(315)		(256)
Acquisition-related items	(28)		(17)		(74)		(57)
Certain litigation charges	(108)		(63)		(276)		(166)
IPR&D charges	—		(11)		—		(26)
Exit of businesses	—		(69)		(41)		(149)
Debt tender premium and other charges	—		—		7		—
Medical device regulations	(13)		—		(31)		—
Contribution to Medtronic Foundation	—		—		(80)		—

Income before income taxes	$	1,579	$	1,370	$	3,850	$	3,905

Geographic Information

Net sales are attributed to the country based on the location of the customer taking possession of the products or in which the services are rendered. The following table presents net sales for the three and nine months ended January 24, 2020 and January 25, 2019 for the Company's country of domicile, countries with significant concentrations, and all other countries:


	Three months ended						Nine months ended
(in millions)	January 24, 2020		January 25, 2019		January 24, 2020		January 25, 2019
Ireland	$	22	$	24	$	66	$	68

United States	4,021		4,001		12,068		11,910
Rest of world	3,674		3,521		10,782		10,433
Total other countries, excluding Ireland	7,695		7,522		22,850		22,343
Total	$	7,717	$	7,546	$	22,916	$	22,411