Taxes on Earnings (Tables)

12 Months Ended

Dec. 31, 2024

Earnings before taxes, and the related provisions for taxes on earnings, were as follows:


(in millions)	2024		2023		2022
Earnings Before Taxes:
Domestic	$	947	$	1,192	$	3,732
Foreign	6,066		5,472		4,574
Total	$	7,013	$	6,664	$	8,306

Schedule of Provisions for Taxes on Earnings


(in millions)	2024		2023		2022
Taxes on Earnings:
Current:
Domestic	$	497	$	528	$	1,309
Foreign	1,075		874		723
Total current	1,572		1,402		2,032
Deferred:
Domestic	(459)		(382)		(610)
Foreign	(7,502)		(79)		(49)
Total deferred	(7,961)		(461)		(659)
Total	$	(6,389)	$	941	$	1,373

Schedule of Reconciliation of Income Tax Rate and U.S. Statutory Tax Rate to Income Tax Expense (Benefit)

Differences between the effective income tax rate and the U.S. statutory tax rate were as follows:


	2024		2023		2022
Statutory tax rate on earnings	21.0	%	21.0	%	21.0	%
Impact of foreign operations	(1.8)		(3.6)		(2.5)

Foreign-derived intangible income benefit	(2.3)		(2.2)		(2.0)
Valuation allowance adjustments	(107.1)		—		—

Excess tax benefits related to stock compensation	(0.7)		(0.3)		(0.5)
Research tax credit	(1.0)		(1.1)		(0.9)
Resolution of certain tax positions pertaining to prior years	0.4		1.2		0.2
Intercompany restructurings and integration	0.2		(1.4)		—
State taxes, net of federal benefit	0.3		0.5		0.7
All other, net	(0.1)		—		0.5
Effective tax rate on earnings	(91.1)	%	14.1	%	16.5	%

Schedule of Components of Net Deferred Tax Assets and Liabilities

The tax effect of the differences that give rise to deferred tax assets and liabilities were as follows:


(in millions)	2024		2023
Deferred tax assets:
Compensation and employee benefits	$	—	$	89
Trade receivable reserves	230		221
Research and development costs	773		568
Inventory reserves	168		198
Lease liabilities	265		272
Deferred intercompany profit	284		283
NOLs, reserves not currently deductible, credit carryforwards and other	10,353		9,922
Total deferred tax assets before valuation allowance	12,073		11,553
Valuation allowance	(1,664)		(8,690)
Total deferred tax assets	10,409		2,863
Deferred tax liabilities:
Compensation and employee benefits	(276)		—
Depreciation	(408)		(414)
Right of Use lease assets	(249)		(258)
Other, primarily the excess of book basis over tax basis of intangible assets	(1,365)		(1,777)
Total deferred tax liabilities	(2,298)		(2,449)
Total net deferred tax assets (liabilities)	$	8,111	$	414

Schedule of Reconciliation of Unrecognized Tax Benefits for the Period

The following table summarizes the gross amounts of unrecognized tax benefits without regard to reduction in tax liabilities or additions to deferred tax assets and liabilities if such unrecognized tax benefits were settled:


(in millions)	2024		2023
January 1	$	3,323	$	2,036
Increase due to current year tax positions	167		225
Increase due to prior year tax positions	174		1,338
Decrease due to prior year tax positions	(50)		(89)
Settlements	(13)		(144)
Lapse of statute	(33)		(43)
December 31	$	3,568	$	3,323