Segment and Geographic Information

9 Months Ended

Jan. 28, 2022

Segment Reporting [Abstract]

Segment and Geographic Information

Segment and Geographic Information

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. The Company’s management evaluates performance of the segments and allocates resources based on net sales and 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 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 30, 2021. 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.

Effective February 1, 2021, the Company implemented a new operating model, moving from a Group structure to a Portfolio structure: Cardiovascular Portfolio (formerly Cardiac and Vascular Group), Neuroscience Portfolio (formerly Restorative Therapies Group), and Medical Surgical Portfolio (formerly Minimally Invasive Therapies Group). The Diabetes Operating Unit (formerly Diabetes Group) remains a separate operating and reportable segment in the new structure. There were no changes to the reportable segments during the fiscal year ended April 30, 2021, such that the four principal operating and reportable segments are as follows: Cardiovascular Portfolio, Neuroscience Portfolio, Medical Surgical Portfolio, and Diabetes Operating Unit.

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

Segment Operating Profit

	Three months ended				Nine months ended
(in millions)	January 28, 2022		January 29, 2021		January 28, 2022		January 29, 2021
Cardiovascular	$	1,077	$	994	$	3,333	$	2,745
Medical Surgical	923		890		2,746		2,120
Neuroscience	903		861		2,753		2,189
Diabetes	161		177		450		412
Segment operating profit	3,064		2,922		9,282		7,466
Interest expense	(137)		(143)		(410)		(783)
Other non-operating income, net	67		86		244		233
Amortization of intangible assets	(432)		(453)		(1,298)		(1,337)
Corporate	(483)		(398)		(1,347)		(1,222)
Centralized distribution costs	(401)		(458)		(1,382)		(1,398)
Restructuring and associated costs	(78)		(160)		(237)		(466)
Acquisition-related items	50		(35)		(46)		13
Certain litigation charges, net	(35)		(122)		(95)		(118)
MCS impairments / costs	—		—		(726)		—
Medical device regulations	(25)		(21)		(70)		(58)
Income before income taxes	$	1,589	$	1,220	$	3,915	$	2,329

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 28, 2022 and January 29, 2021 for the Company's country of domicile, countries with significant concentrations, and all other countries:

	Three months ended				Nine months ended
(in millions)	January 28, 2022		January 29, 2021		January 28, 2022		January 29, 2021
Ireland	$	24	$	25	$	76	$	74
United States	3,939		3,939		12,038		11,344
Rest of world	3,800		3,811		11,483		10,511
Total other countries, excluding Ireland	7,739		7,750		23,521		21,855
Total	$	7,763	$	7,775	$	23,597	$	21,929