ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS

ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS

ACQUISITIONS.

On February 17, 2023, the Company acquired 100% of the stock of Caption Health, Inc. (“Caption Health”) for $127 million of upfront payment, $10 million future holdback payment, and potential earn-out payments valued at $13 million based primarily on various milestones and sales targets. The preliminary purchase price allocation resulted in goodwill of $94 million, intangible assets of $60 million, and deferred tax liabilities of $3 million. Our estimates and assumptions are subject to change within the measurement period. The goodwill associated with the acquired business is non-deductible for tax purposes and is reported in the Ultrasound segment. Caption Health is an artificial intelligence (“AI”) company whose technology expands access to AI-guided ultrasound screening for novice users.

See Note 12, “Financial Instruments and Fair Value Measurements” for further information about the fair value measurement of contingent consideration.

Goodwill
	Balance as of December 31, 2022		Acquisitions		Foreign exchange and other		Balance as of September 30, 2023
Imaging(1)	$	4,409	$	16	$	(3)	$	4,422
Ultrasound	3,835		94		(6)		3,923
PCS	2,036		—		—		2,036
PDx	2,533		—		—		2,533
Total Goodwill	$	12,813	$	110	$	(9)	$	12,914

(1) Includes the acquisition of IMACTIS SAS in the second quarter of 2023.

We assess the possibility that a reporting unit’s fair value has been reduced below its carrying amount due to the occurrence of events or circumstances between annual impairment testing dates. We did not identify any reporting units that required an interim impairment test since the last annual impairment testing date.

Substantially all other intangible assets are subject to amortization. Intangible assets decreased during the nine months ended September 30, 2023, primarily as a result of amortization, partially offset by acquisitions in our Imaging and Ultrasound segments. Amortization expense was $89 million and $103 million for the three months ended September 30, 2023 and 2022, respectively, and $278 million and $307 million for the nine months ended September 30, 2023 and 2022, respectively.

ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS

ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS

ACQUISITIONS.

On February 17, 2023, the Company acquired 100% of the stock of Caption Health, Inc. (“Caption Health”) for $127 million of upfront payment, $10 million future holdback payment, and potential earn-out payments valued at $13 million based primarily on various milestones and sales targets. The preliminary purchase price allocation resulted in goodwill of $94 million, intangible assets of $60 million, and deferred tax liabilities of $3 million. Our estimates and assumptions are subject to change within the measurement period. The goodwill associated with the acquired business is non-deductible for tax purposes and is reported in the Ultrasound segment. Caption Health is an artificial intelligence (“AI”) company whose technology expands access to AI-guided ultrasound screening for novice users.

See Note 12, “Financial Instruments and Fair Value Measurements” for further information about the fair value measurement of contingent consideration.

Goodwill
	Balance as of December 31, 2022		Acquisitions		Foreign exchange and other		Balance as of September 30, 2023
Imaging(1)	$	4,409	$	16	$	(3)	$	4,422
Ultrasound	3,835		94		(6)		3,923
PCS	2,036		—		—		2,036
PDx	2,533		—		—		2,533
Total Goodwill	$	12,813	$	110	$	(9)	$	12,914

(1) Includes the acquisition of IMACTIS SAS in the second quarter of 2023.

We assess the possibility that a reporting unit’s fair value has been reduced below its carrying amount due to the occurrence of events or circumstances between annual impairment testing dates. We did not identify any reporting units that required an interim impairment test since the last annual impairment testing date.

Substantially all other intangible assets are subject to amortization. Intangible assets decreased during the nine months ended September 30, 2023, primarily as a result of amortization, partially offset by acquisitions in our Imaging and Ultrasound segments. Amortization expense was $89 million and $103 million for the three months ended September 30, 2023 and 2022, respectively, and $278 million and $307 million for the nine months ended September 30, 2023 and 2022, respectively.