UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-13149

 

STRYKER CORPORATION

(Exact name of registrant as specified in its charter)

Michigan				38-1239739
(State of incorporation)				(I.R.S. Employer Identification No.)
1941 Stryker Way,	Portage,		Michigan	49002
(Address of principal executive offices)				(Zip Code)
		(269)	385-2600
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.10 Par Value	SYK	New York Stock Exchange
0.250% Notes due 2024	SYK24A	New York Stock Exchange
2.125% Notes due 2027	SYK27	New York Stock Exchange
3.375% Notes due 2028	SYK28	New York Stock Exchange
0.750% Notes due 2029	SYK29	New York Stock Exchange
2.625% Notes due 2030	SYK30	New York Stock Exchange
1.000% Notes due 2031	SYK31	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes ☒     No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.    Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ☒     No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒      No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☐	Small reporting company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.7262(b)) by the registered public accounting firm that prepared or issued its audit report.                                ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes ☐    No ☒

The aggregate market value of the voting stock held by non-affiliates of the registrant was approximately $109,722,902,589 at June 30, 2023. There were 380,264,036 shares outstanding of the registrant’s common stock, $0.10 par value, on January 31, 2024.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the proxy statement to be filed with the U.S. Securities and Exchange Commission relating to the 2024 Annual Meeting of Shareholders (the 2024 proxy statement) are incorporated by reference into Part III.

STRYKER CORPORATION 2023 FORM 10-K

TABLE OF CONTENTS

PART I
Item 1.	Business	1
Item 1A.	Risk Factors	4
Item 1B.	Unresolved Staff Comments	10
Item 1C.	Cybersecurity	10
Item 2.	Properties	11
Item 3.	Legal Proceedings	11
Item 4.	Mine Safety Disclosures	11
PART II
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	11
Item 6.	Selected Financial Data	12
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 8.	Financial Statements and Supplementary Data	23
	Report of Independent Registered Public Accounting Firm (PCAOB ID: 42)	23
	Consolidated Statements of Earnings	24
	Consolidated Statements of Comprehensive Income	24
	Consolidated Balance Sheets	25
	Consolidated Statements of Shareholders’ Equity	26
	Consolidated Statements of Cash Flows	27
	Notes to Consolidated Financial Statements	28
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	41
Item 9A.	Controls and Procedures	41
Item 9B.	Other Information	42
Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections	42
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	42
Item 11.	Executive Compensation	42
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	42
Item 13.	Certain Relationships and Related Transactions, and Director Independence	42
Item 14.	Principal Accountant Fees and Services	42
PART IV
Item 15.	Exhibits, Financial Statement Schedules	43
Item 16.	Form 10-K Summary	46

STRYKER CORPORATION 2023 FORM 10-K

PART I

ITEM 1. BUSINESS.

Stryker Corporation (Stryker or the Company) is a global leader in medical technologies and, together with our customers, we are driven to make healthcare better. We offer innovative products and services in MedSurg, Neurotechnology, Orthopaedics and Spine that help improve patient and healthcare outcomes. Alongside our customers around the world, we impact more than 150 million patients annually.

Our core values guide our behaviors and actions and are fundamental to how we execute our mission.

Stryker was incorporated in Michigan in 1946 as the successor company to a business founded in 1941 by Dr. Homer H. Stryker, a prominent orthopaedic surgeon and inventor of several medical products. Our products are sold in approximately 75 countries through company-owned subsidiaries and branches as well as third-party dealers and distributors, and include surgical equipment and surgical navigation systems; endoscopic and communications systems; patient handling, emergency medical equipment and intensive care disposable products; clinical communication and workflow solutions; neurosurgical and neurovascular devices; implants used in joint replacement and trauma surgeries; Mako Robotic-Arm Assisted technology; spinal devices; as well as other products used in a variety of medical specialties. Most of our products are marketed directly to doctors, hospitals and other healthcare facilities.

As used herein, and except where the context otherwise requires, "Stryker," "we," "us," and "our" refer to Stryker Corporation and its consolidated subsidiaries.

Business Segments and Geographic Information

We segregate our operations into two reportable business segments: (i) MedSurg and Neurotechnology and (ii) Orthopaedics and Spine. Financial information regarding our reportable business segments and certain geographic information is included under "Consolidated Results of Operations" in Item 7 of this report and Note 14 to our Consolidated Financial Statements.

Net Sales by Reportable Segment
	2023				2022				2021
MedSurg and Neurotechnology	$	11,836	58	%	$	10,611	58	%	$	9,538	56	%
Orthopaedics and Spine	8,662		42		7,838		42		7,570		44
Total	$	20,498	100	%	$	18,449	100	%	$	17,108	100	%

MedSurg and Neurotechnology

MedSurg products include surgical equipment, patient and caregiver safety technologies, and navigation systems (Instruments), endoscopic and communications systems and reprocessed and remanufactured medical devices (Endoscopy), and patient handling, emergency medical equipment, intensive care disposable products and clinical communication and workflow solutions (Medical). Neurotechnology includes neurosurgical, neurovascular and craniomaxillofacial implant products. Our neurotechnology offering includes products used for minimally invasive endovascular procedures; a comprehensive line of products for traditional brain and open skull based surgical procedures; orthobiologic and biosurgery products, including synthetic bone grafts and vertebral augmentation products (Neuro Cranial); and minimally invasive products for the treatment of acute ischemic and hemorrhagic stroke (Neurovascular). The craniomaxillofacial implant offering includes cranial, maxillofacial and chest wall devices as well as dural substitutes and sealants.

We are one of five leading global competitors in Instruments; the other four being Zimmer Biomet Holdings, Inc. (Zimmer), Medtronic plc (Medtronic), Johnson & Johnson and ConMed Linvatec, Inc. (a subsidiary of CONMED Corporation). We are one of seven leading global competitors in Endoscopy; the other six being Karl Storz GmbH & Co., Olympus Optical Co. Ltd., Smith & Nephew plc (Smith & Nephew), ConMed Linvatec, Arthrex, Inc. and STERIS plc. We are one of five leading global competitors in Medical; the other four being Baxter International Inc., Zoll Medical Corporation, Medline Industries and Ferno-Washington, Inc. We are one of five leading global competitors in Neurotechnology; the other four being Medtronic, Johnson & Johnson, Terumo Corporation and Penumbra, Inc.

Composition of MedSurg and Neurotechnology Net Sales
	2023				2022				2021
Instruments	$	2,569	22	%	$	2,279	21	%	$	2,111	22	%
Endoscopy	3,033		26		2,725		26		2,418		25
Medical	3,459		29		3,031		29		2,607		27
Neurovascular	1,226		10		1,200		11		1,188		13
Neuro Cranial	1,549		13		1,376		13		1,214		13
Total	$	11,836	100	%	$	10,611	100	%	$	9,538	100	%

In 2023 Instruments launched the Neptune S, which is the only constantly closed low-fluid waste management system on the market. Instruments also saw continued momentum from the launch of the System 9 total joint power tool.

Endoscopy expanded its product offering with the launch of the 4K 1788 Camera platform that features several enhancements for a broader range of clinical applications and specialties, including urology, neurology and ear, nose and throat. In addition, 1788 can be used to visualize indocyanine green and Cytalux.

Medical launched the Xpedition powered stair chair, designed with an integrated workflow for first responders, maintaining the same storage footprint as Stryker's Stair-PRO and enhanced user interface for ease of use. Xpedition allows caregivers to safely and ergonomically move patients over a variety of terrains.

Neurovascular completed the acquisition of Cerus Endovascular Limited (Cerus), a leader in the design and development of neurointerventional devices for the treatment of intracranial aneurysms. The acquisition of Cerus is highly complementary to our Neurovascular business and strengthens our hemorrhagic portfolio globally. Neurovascular also launched the Target Tetra coil in the United States, Japan, Korea and Europe, Middle East, Africa for the treatment of small aneurysms and the Vecta 46 Intermediate Catheter in the United States, Japan and Korea.

Dollar amounts in millions except per share amounts or as otherwise specified. 1

STRYKER CORPORATION 2023 FORM 10-K

Orthopaedics and Spine

Orthopaedics products consist primarily of implants used in total joint replacements, such as hip, knee and shoulder, and trauma and extremities surgeries. We bring patients and physicians advanced implant designs and specialized instrumentation that make orthopaedic surgery and recovery simpler, faster and more effective. We support surgeons with the technology and services they need as they develop new surgical techniques. The Mako Robotic-Arm Assisted Surgical System was designed to help surgeons provide patients with a personalized surgical experience based on their specific diagnosis and anatomy. The Mako System currently offers three applications supporting Partial Knee, Total Hip and Total Knee procedures. Mako is the only robotic-arm assisted technology enabled by 3D CT-based pre-operative planning and, with AccuStop™ haptic technology, Mako provides surgeons the ability to know more about their patients' anatomy so they can cut less in bone preparation and implant placement with intra-operative haptic guidance.

Our spinal implant offering includes cervical and thoracolumbar systems that include fixation, minimally invasive and interbody systems used in spinal injury, complex spine and degenerative therapies. Our spine enabling technologies portfolio includes best in class imaging solutions, image-guided surgical technology, patient specific implants and digital health solutions supporting surgeons and their patients throughout the continuum of care.

We are one of four leading global competitors for joint replacement and trauma and extremities products and robotics; the other three being Zimmer, DePuy Synthes (a Johnson & Johnson company) and Smith & Nephew. We are one of four leading global competitors in Spine; the other three being Medtronic Sofamor Danek, Inc. (a subsidiary of Medtronic), Globus Medical, Inc. (including Nuvasive) and DePuy Synthes.

Composition of Orthopaedics and Spine Net Sales
	2023				2022				2021
Knees	$	2,273	26	%	$	1,997	25	%	$	1,848	25	%
Hips	1,544		18		1,413		18		1,342		18
Trauma and Extremities	3,147		36		2,807		36		2,664		35
Spine	1,189		14		1,146		15		1,167		15
Other	509		6		475		6		549		7
Total	$	8,662	100	%	$	7,838	100	%	$	7,570	100	%

In 2023 we continued our full commercial launch of the Insignia hip stem. Insignia received approval in Japan from the Pharmaceuticals and Medical Devices Agency and clinical cases occurred in December 2023. With the addition of Japan, Insignia is now being used clinically in six countries worldwide (United States, Canada, Japan, New Zealand, Singapore and Hong Kong). We also saw our first clinical use of the Triathlon Hinge revision knee system in August 2023. The Hinge product helps restore patient mobility in challenging cases and we anticipate moving towards full commercial launch in 2024. In 2023 we celebrated the 10th anniversary of the Triathlon Tritanium Baseplate. Since its introduction in 2013, Triathlon Cementless, which includes the Triathlon Tritanium Baseplate, has delivered a decade of positive patient impact, demonstrated impressive survivorship data and has become a trusted solution for surgeons across the globe.

In 2023 we celebrated the 10-year anniversary of the Mako Surgical Corp. acquisition and the Mako SmartRobotics™ technology. Over the past ten years, this groundbreaking technology has transformed the orthopaedics landscape, resulting in tremendous patient impact for surgeons and their patients. Additionally, we reached the milestone of 1 million Mako SmartRobotics™ procedures performed globally.

Raw Materials and Inventory

Raw materials essential to our business are generally readily available from multiple sources; however, certain of our raw materials are currently sourced from single suppliers. Substantially all products we manufacture are stocked in inventory, while certain MedSurg products are assembled to order.

Patents and Trademarks

Patents and trademarks are significant to our business to the extent that a product or an attribute of a product represents a unique design or process. Patent protection of such products restricts competitors from duplicating these unique designs and features. We seek to obtain patent protection on our products whenever appropriate for protecting our competitive advantage. On December 31, 2023 we owned approximately 5,200 United States patents and approximately 7,700 patents in other countries.

Seasonality

Our business is generally not seasonal in nature; however, the number of orthopaedic implant surgeries is typically lower in the summer months, and sales of capital equipment are generally higher in the fourth quarter.

Competition

In each of our product lines we compete with local and global companies. The development of innovative products is important to our success in all areas of our business. Competition in research involving the development and improvement of new and existing products and processes is particularly significant. The competitive environment requires substantial investments in continuing research and maintaining sales forces.

We believe our commitment to innovation, quality and service and our reputation differentiates us in the highly competitive product categories in which we operate and enables us to compete effectively. We believe that our competitive position in the future will depend to a large degree on our ability to develop new products and make improvements to existing products.

Regulation

Our businesses are subject to varying degrees of governmental regulation in the countries in which we operate, and the general trend is toward increasingly stringent regulation. We are required to comply with the unique regulatory requirements of each country in which we market and sell our products.

In the United States the Medical Device Amendments of 1976 to the Federal Food, Drug and Cosmetic Act and its subsequent amendments and the regulations issued and proposed thereunder provide for federal regulation by the United States Food and Drug Administration (FDA) of the design, manufacture and marketing of medical devices, including most of our products. In addition, state licensing requirements often apply to certain of our business operations and products. On the federal level, many of our new products fall into FDA classifications that require notification submitted as a 510(k) and review by the FDA before we begin marketing them. Certain of our products require extensive clinical testing, consisting of safety and efficacy studies, followed by pre-market approval applications for specific surgical indications. Certain of our products also fall under other FDA classifications, such as drugs and Human Cells, Tissues, and Cellular and Tissue-Based Products.

The FDA's Quality System regulations set forth standards for our product design and manufacturing processes, require the maintenance of certain records and provide for inspections of our facilities by the FDA. There are also certain requirements of

Dollar amounts in millions except per share amounts or as otherwise specified. 2

STRYKER CORPORATION 2023 FORM 10-K

state, local and foreign governments that must be complied with in the manufacture and marketing of our products.

The European Union enacted the European Union Medical Device Regulation in May 2017 with an original effective date of May 2021, which imposes stricter requirements for the marketing and sale of medical devices, including in the areas of clinical evaluation requirements, quality systems, labeling and post-market surveillance. Extended transition timelines were published in 2023 which range from May 2026 through December 2028 depending on the type of device and our implementation is on track to meet these timelines.

Initiatives to limit the growth of general healthcare expenses and hospital costs are ongoing in the markets we do business. These initiatives are sponsored by government agencies, legislative bodies and the private sector and include price regulation and competitive pricing. It is not possible to predict at this time the long-term impact of such cost containment measures on our future business. In addition, business practices in the healthcare industry are scrutinized, particularly in the United States, by federal and state government agencies. The resulting investigations and prosecutions carry the risk of significant civil and criminal penalties.

Environment

We are subject to various rules and regulation in the United States and internationally related to the protection of human health and the environment. Our operations involve the use of substances regulated under environmental laws, primarily in manufacturing and sterilization processes. We believe our policies, practices and procedures are properly designed to comply, in all material respects, with applicable environmental laws and regulations. We do not expect compliance with these requirements to have a material effect on purchases of property, plant and equipment, cash flows, net earnings or competitive position.

Employees

On December 31, 2023 we had approximately 52,000 employees globally, with approximately 27,000 employees in the United States. Our talented employees are an integral reason for our standing as a global leader in medical technologies where, together with our customers, we are driven to make healthcare better. Our company values of integrity, accountability, people and performance are a key component of that mission. Our people, as one of our core values, continue to be a key focus.

Our success depends on our ability to attract the best talent. To do so, we continue to focus on creating and maintaining a great workplace. We believe in attracting the right people, maintaining and building employee engagement and developing our employees. We believe when people are able to do what they do best, they will look forward to coming to work and, in turn, will deliver great business results.

Our leadership team and Board of Directors receive regular updates on our people and culture strategy and provide feedback on our strategy and goals, including alignment to our mission and values, peer benchmarking and stakeholder feedback.

Employee Development

Our employee development is extensive and exists at all levels of the organization, including company-wide training on our Code of Conduct, job-related technical training and management and leadership training. Our development programs include on-the-job learning, coaching and mentoring, management and leadership development courses, team building and collaboration training and immersive experiences with expert partners.

We encourage all employees to establish development objectives, in partnership with their manager, to help employees gain the needed development experience to grow their careers.

Employee Engagement

An engaged workplace culture that drives performance and business outcomes is central to our mission. Listening to and learning from our employees forms the foundation of an engaging culture. More than 90% of our employees participate in our annual engagement survey, which provides a valued platform for listening and allows us to take action based on the feedback collected.

We supplement our annual engagement survey with targeted pulse surveys to gather feedback on topics relevant to the current climate. In addition, we establish forums for collecting qualitative feedback to gain insights and identify actions we can take so that employees feel included, engaged and able to achieve their full potential.

We also provide tools and resources that enable managers and teams to act on the insights we gain from our surveys and to drive employee engagement and strong business outcomes.

Diversity, Equity and Inclusion (DE&I)

An essential part of our culture is respecting each individual’s strengths and values. Building on this foundation, we are focused on maintaining an inclusive, engaging work environment and prioritizing DE&I in keeping with our values of integrity and people. Our DE&I strategy is centered around these three commitments:

•Strengthen the diversity of our workforce

•Advance a culture of inclusion, engagement and belonging

•Maximize the power of inclusion to drive innovation and growth

We are advancing our commitments through the following actions, among others:

•Increasing access to talent through strategic partnerships and campaigns

•Growing and engaging talent with a range of opportunities to learn and develop

•Aligning our employee resource groups to focus on creating community and belonging

As of December 31, 2023 approximately 38.1% of our employees were women and 27.9% of our employees in the United States identified as racially or ethnically diverse.

Attracting and Hiring

We understand that every employee drives our success. We focus on attracting, identifying and selecting strong candidates who will be successful at Stryker and ensuring that each person we hire brings the talent, expertise and passion we need to continue to be successful.

Health and Safety

Ensuring our employees' safety is a top priority. It is a responsibility that we share throughout the company and one that has evolved to meet the needs of our workforce. Employees' safety risks vary depending on the roles they perform, so we tailor our safety efforts accordingly.

Competitive Pay and Benefits

Our compensation and benefits programs are designed to attract and retain top talent and to incentivize performance and alignment to our mission and values.

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STRYKER CORPORATION 2023 FORM 10-K

We offer market-competitive base pay and benefits to our employees in countries around the world. We regularly evaluate our compensation and benefit offerings and levels, using recognized outside consulting firms to ensure internal fairness and competitiveness in our offerings.

Most of our employees also have variable components to their compensation packages that reward employees based on individual, business unit and/or company-wide performance.

Our proxy statement provides more detail on the competitive compensation programs we offer.

Information about our Executive Officers

As of January 31, 2024
Name	Age	Title	First Became an Executive Officer
Kevin A. Lobo	58	Chair, Chief Executive Officer and President	2011
Yin C. Becker	60	Vice President, Chief Corporate Affairs Officer	2016
William E. Berry Jr.	58	Vice President, Chief Accounting Officer	2014
Glenn S. Boehnlein	62	Vice President, Chief Financial Officer	2016
M. Kathryn Fink	54	Vice President, Chief Human Resources Officer	2016
Robert S. Fletcher	53	Vice President, Chief Legal Officer	2019
Viju S. Menon	56	Group President, Global Quality and Operations	2018
J. Andrew Pierce	50	Group President, MedSurg and Neurotechnology	2021
Spencer S. Stiles	47	Group President, Orthopaedics and Spine	2021

Each of our executive officers was elected by our Board of Directors to serve in the office indicated until the first meeting of the Board of Directors following the annual meeting of shareholders in 2024 or until a successor is chosen and qualified or until his or her resignation or removal. Each of our executive officers held the position above or served Stryker in various executive or administrative capacities for at least five years, except for Mr. Fletcher. Prior to joining Stryker in April 2019, Mr. Fletcher held various legal leadership roles with Johnson & Johnson for the previous 14 years, most recently as the Worldwide Vice President, Litigation.

Available Information

Our main corporate website address is www.stryker.com. The information on our website is not incorporated by reference into this report. Copies of our filings with the United States Securities and Exchange Commission (SEC) are available free of charge on our website within the "Investors Relations" section as soon as reasonably practicable after having been electronically filed or furnished to the SEC. All SEC filings are also available at the SEC's website at www.sec.gov.

ITEM 1A. RISK FACTORS.

This report contains statements that are not historical facts and are considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current projections about operations, industry conditions, financial condition and liquidity. Words that identify forward-looking statements include, without limitation, words such as "may," "could," "will," "should," "possible," "plan," "predict," "forecast," "potential," "anticipate," "estimate," "expect," "project," "intend," "believe," "may impact," "on track," "goal," "strategy" and words and terms of similar substance used in connection with any discussion of future operating or financial performance, an acquisition or our businesses. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any

underlying assumptions, are forward-looking statements. Those statements are not guarantees and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, actual results could differ materially and adversely from these forward-looking statements, historical experience or our present expectations. Some important factors that could cause our actual results to differ from our expectations in any forward-looking statements include:

•weakening of economic conditions, or the anticipation thereof, that could adversely affect the level of demand for our products;

•geopolitical risks, including from international conflicts and upcoming elections in the United States and other countries, which could, among other things, lead to increased market volatility;

•pricing pressures generally, including cost-containment measures that could adversely affect the price of or demand for our products;

•changes in foreign currency exchange markets;

•legislative and regulatory actions;

•unanticipated issues arising in connection with clinical studies and otherwise that affect approval of new products by the FDA and foreign regulatory agencies;

•inflationary pressures;

•increased interest rates or interest rate volatility;

•supply chain disruptions;

•changes in labor markets;

•changes in reimbursement levels from third-party payors;

•a significant increase in product liability claims;

•the ultimate total cost with respect to recall-related and other regulatory and quality matters;

•the impact of investigative and legal proceedings and compliance risks;

•resolution of tax audits;

•changes in tax laws and regulations;

•the impact of legislation to reform the healthcare system in the United States or other countries;

•costs to comply with medical device regulations;

•changes in financial markets;

•changes in our credit ratings;

•changes in the competitive environment;

•our ability to integrate and realize the anticipated benefits of acquisitions in full or at all or within the expected timeframes;

•our ability to realize anticipated cost savings;

•potential negative impacts resulting from climate change or other environmental, social and governance and sustainability related matters;

•the impact on our operations and financial results of any public health emergency and any related policies and actions by governments or other third parties;

•breaches or failures of our or our vendors’ or customers’ information technology systems or products, including by cyber-attack, data leakage, unauthorized access or theft; and

•other risks detailed in our filings with the SEC.

While we believe that the assumptions underlying such forward-looking statements are reasonable, there can be no assurance that future events or developments will not cause such statements to be inaccurate. All forward-looking statements

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STRYKER CORPORATION 2023 FORM 10-K

contained in this report are qualified in their entirety by this cautionary statement. We expressly disclaim any intention or obligation to publicly update or revise any forward-looking statement to reflect any change in our expectations or in events, conditions or circumstances on which those expectations may be based, or that affect the likelihood that actual results will differ from those contained in the forward-looking statements.

Our operations and financial results are subject to various risks and uncertainties discussed below that could materially and adversely affect our business, cash flows, financial condition and results of operations. Additional risks and uncertainties not currently known to us or that we currently deem not to be material or that could apply to any company may also materially and adversely affect our business, cash flows, financial condition or results of operations. If any of the risks discussed below or other risks actually occur or continue to occur, our business, financial condition, operating results or cash flows could be materially adversely affected. Accordingly, you should carefully consider the following risk factors, as well as other information contained in or incorporated by reference in this report.

BUSINESS AND OPERATIONAL RISKS

We use a variety of raw materials, components, devices and third-party services in our global supply chains, production and distribution processes; significant shortages, price increases or unavailability of third-party services have in the past increased, and could in the future increase, our operating costs and could require significant capital expenditures or adversely impact the competitive position of our products: Our reliance on certain suppliers to secure raw materials, components and finished devices, and on certain third-party service providers, such as sterilization service providers, exposes us to product shortages and unanticipated increases in prices, whether due to inflationary pressure, regulatory changes, litigation exposure, geopolitical tensions or otherwise. For example, in the past we experienced limited product availability due to an electronic components shortage in certain product lines. If a similar shortage occurs in the future with respect to other raw materials or components, we may not be able to obtain them from our suppliers on a timely basis, or at all, or identify alternative suppliers. In addition, several raw materials, components, finished devices and services are procured from a sole source due to the quality considerations, unique intellectual property considerations or constraints associated with regulatory requirements. If sole-source suppliers or service providers are unable or unwilling to deliver these materials or services as a result of financial difficulties, acquisition by a third party, natural disasters or otherwise, we may not be able to manufacture or have available one or more products during such period of unavailability and our business could suffer. In certain cases, we may not be able to establish additional or replacement suppliers for such materials or service providers for such services in a timely or cost-effective manner, often as a result of FDA and other regulations that require, among other things, validation of materials, components and services prior to their use in or with our products. In certain instances we have been unable to meet demand due to supply chain challenges, which has led to loss of sales. Although the impacts have not been material to date, an inability to meet demand due to supply chain challenges in the future could materially adversely impact our reputation, the competitive position of our products and our business. Any of the foregoing risks could have a material adverse impact on our profitability and results of operations.

In addition, since 2022 the market has experienced increasing inflationary pressures in part due to global supply chain disruptions, labor shortages and other impacts following the COVID-19 pandemic. We expect these inflationary pressures will continue. Inflation in the United States and in many of the countries where we conduct business has resulted in, and may

continue to result in, higher interest rates and increased capital, energy, shipping and labor costs, weakening or strengthening exchange rates against the United States Dollar and other similar effects. We have experienced, and may continue to experience, inflationary increases in manufacturing costs and operating expenses, as well as negative impacts from weakening or strengthening exchange rates against the United States Dollar. Although we have been able to pass certain cost increases on to our customers, we have not been able to pass along all cost increases and we cannot guarantee that we will be able to do so in the future. Inflation, higher interest rates or interest rate volatility may also cause our customers to reduce or delay orders for our products and services. Any of the foregoing could have a material adverse impact on our sales, profitability and results of operations.

We are subject to pricing pressures as a result of cost containment measures in the United States and other countries and other factors: Initiatives to limit the growth of general healthcare expenses and hospital costs are ongoing in the markets in which we do business. These initiatives are sponsored by government agencies, legislative bodies and the private sector and include price regulation and competitive pricing. For example, China has implemented a volume-based procurement process designed to decrease prices for medical devices and other products. This has already impacted our joint replacement and spine businesses on a national level, and our trauma and certain neurovascular products on a provincial level, and we expect further adoption of volume-based procurement provincially or nationally in China in 2024. Pricing pressure has also increased due to continued consolidation among healthcare providers, trends toward managed care, the shift toward governments becoming the primary payers of healthcare expenses, reduction in reimbursement levels and medical procedure volumes and government laws and regulations relating to sales and promotion, reimbursement and pricing generally. We have also reduced prices for certain products due to increased competition and if we further reduce prices, we could become less profitable. In addition, due to healthcare industry consolidation in recent years, competition to provide goods and services to industry participants has become, and may continue to become, more intense, and this consolidation has produced, and may continue to produce, larger enterprises with more bargaining power. Pricing pressures related to any of the foregoing or other factors have impacted and could in the future impact our results of operations and profitability.

We operate in a highly competitive industry in which competition in the development and improvement of new and existing products is significant: The markets in which we compete are highly competitive, and a significant element of our strategy is to increase revenue growth by focusing on innovation and new product development. New business models, products and surgical procedures are introduced on an ongoing basis and our present or future products could be rendered obsolete or uneconomical by internal or external technological advances, as we continue to innovate to address physician and patient needs, or by our existing competitors and new market entrants. Our existing competitors and new market entrants may respond more quickly to or integrate new or emerging technologies such as robotics, artificial intelligence and machine learning in their product offerings, undertake more extensive marketing campaigns, have greater access to clinical information to support ongoing product position in the market, have greater financial, marketing and other resources or be more successful in attracting potential customers, employees and strategic partners. There can be no assurance that any products now in development, or that we may seek to develop in the future, will achieve technological feasibility, obtain regulatory approval or gain market acceptance. If we are unable to develop and launch

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new products, our ability to maintain or expand our market position in the markets in which we participate may be negatively impacted.

We may be unable to maintain adequate working relationships with healthcare professionals: We seek to maintain close working relationships with respected physicians and medical personnel in healthcare organizations, such as hospitals and universities, who assist in product research and development. We rely on these professionals to assist us in the development and improvement of proprietary products. If we are unable to maintain these relationships due to regulatory restrictions, hospital access restrictions for non-patients or for other reasons, our ability to develop, market and sell new and improved products could be adversely affected. For example, China's National Health Commission has launched an anti-corruption campaign focused on investigating government officials and individuals employed by state-owned entities and public institutions in the healthcare sector, which has resulted in us seeing some limitations to physician and surgeon access. Although this has not had a material impact on our business, if other jurisdictions were to take this approach, our business could be adversely impacted.

We rely on indirect distribution channels and major distributors that are independent of Stryker: In many markets we rely on indirect distribution channels to market, distribute and sell our products. These indirect channels often are the main point of contact for the healthcare professionals and healthcare organization customers who buy and use our products. Our ability to continue to market, distribute and sell our products may be at risk if the indirect channels become insolvent, choose to sell competitive products, choose to stop selling medical technology, fail to adhere to Stryker requirements or are subject to new or additional government regulation.

We are subject to risks associated with our extensive global operations: We develop, manufacture and distribute our products globally. Our global operations are subject to risks and costs related to, among other things, changes in reimbursement; changes in regulatory requirements (such as the staggered phase-in period for manufacturers to comply with the European Union Medical Device Regulation (MDR) through December 2028); differing local product preferences and product requirements; diminished protection of intellectual property in some countries; tariffs and other trade protection measures, as well as increasing localization and protectionism policies in certain jurisdictions; international trade disputes and import or export requirements; difficulty in staffing and managing foreign operations; introduction of new internal business structures and programs; political and economic instability; current or potential geopolitical conflicts, such as the tensions between China and Taiwan and the wars in Ukraine and the Middle East, and related sanctions and other developments; disruptions of transportation, including port closures, increased border controls or border closures or reduced transportation availability, due to military conflicts, a global pandemic of contagious diseases like COVID-19 or otherwise; increased energy or transportation costs; fluctuations in currency exchange rates and financial markets; and increased security threats to our supply chain. Many of these risks are rapidly evolving and subject to an accelerating pace of change. Our business could be adversely impacted if we are unable to successfully manage these and other risks of global operations in an increasingly volatile environment. In addition, in many countries, the laws and regulations applicable to us or our industry are evolving, and we have in certain cases become subject to divergent and conflicting laws and regulations across our operations, which could increase risk over time.

We may be unable to capitalize on previous or future acquisitions: In addition to internally developed products, we invest in new products and technologies through acquisitions,

including our acquisition of Cerus in 2023. Such investments are inherently risky, and we cannot guarantee that any acquisition will be successful or will not have a material unfavorable impact on us. The risks include the activities required and resources allocated to integrate new businesses, diversion of management time that could adversely affect management’s ability to focus on other projects, the inability to realize the expected benefits, savings or synergies from the acquisition, the loss of key personnel, litigation resulting from the acquisition and exposure to unexpected liabilities of acquired companies. Certain acquisitions are subject to antitrust and competition laws, and antitrust scrutiny by regulatory agencies and changes to the regulatory approval process in the United States and foreign jurisdictions may cause approvals to take longer than anticipated to obtain, not be obtained at all, or contain burdensome conditions, which may jeopardize, delay or reduce the anticipated benefits of acquisitions to us and could impede the execution of our business strategy. In addition, we cannot be certain that the businesses we acquire will become or remain profitable.

We, our business partners or our third-party vendors could experience a material failure or breach of a key information technology system, network, process or site: We rely extensively on information technology (IT) systems to conduct business. In addition, we rely on networks and services, including internet sites, cloud and software-as-a-service solutions, data hosting and processing facilities and tools and other hardware, software (including open-source software) and technical applications and platforms, some of which are managed, hosted, provided and/or used by third parties or their vendors, to assist in conducting our business. Numerous and evolving cybersecurity threats have posed, and will continue to pose, risks to the security of our IT systems, networks and product offerings, as well as the confidentiality, availability and integrity of our data. Some of our products and services, and information technology systems, contain or use open-source software, which poses particular risks, including potential security vulnerabilities, licensing compliance issues and quality issues. We, our customers and third-party hosting services have experienced, and expect to continue to experience, security breaches of, or unauthorized access to, products or systems. While such breaches or unauthorized access have not been material to date, we cannot guarantee that any future breach or unauthorized access will not be material and any breach or unauthorized access could impact the use of such products and systems and the security of information stored therein. Although we have made investments and expect to continue to make investments seeking to address these threats, including monitoring of networks and systems, use of artificial intelligence, hiring of experts, employee training and security policies for employees and third-party providers, the techniques used in these attacks change frequently and may be difficult to detect for periods of time and we may face difficulties in anticipating and implementing adequate preventative measures.

When cybersecurity incidents occur, we follow our incident response protocols and address them in accordance with applicable governmental regulations and other legal requirements. Our response to these incidents and our investments to protect our product offerings and information technology infrastructure and data may not shield us from significant losses and potential liability or prevent any future interruption or breach of our systems. Moreover, given the increasing complexity and sophistication of the techniques used by threat actors to obtain unauthorized access or disable or degrade systems, a cyberattack could occur and persist for an extended period of time before being detected, and we may not anticipate these acts or mitigate them adequately or timely, which may compound damages before the incident is discovered or remediated. The extent of a particular cyber incident and the steps that we may need to take to investigate the incident may

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not be immediately clear, and it may take a significant amount of time before such investigation can be completed and full and reliable information about the incident is known. New regulations may require us to disclose information about a material cybersecurity incident before it has been resolved or fully investigated. Additionally, as threats continue to evolve and increase, and as the regulatory environment related to information security, data collection and use, and privacy becomes increasingly rigorous, we may be required to devote significant additional resources to modify and enhance our security controls and to identify and remediate any security vulnerabilities, which could adversely impact our net income. In addition, a significant number of our employees working remotely has exposed us, and may continue to expose us, to greater risks related to cybersecurity and cyber-liability. If our IT systems are damaged or cease to function properly, the networks or service providers we rely upon fail to function properly, or we or one of our third-party providers suffer a loss or disclosure of our business or stakeholder information due to any number of causes ranging from catastrophic events or power outages to improper data handling or security breaches or unauthorized access and our business continuity plans do not effectively address these failures on a timely basis, we may be exposed to reputational, competitive and business harm as well as litigation and regulatory action.

An inability to successfully manage the implementation of our new commercial global enterprise resource planning (ERP) system could adversely affect our operations and operating results: We are in the process of implementing a new commercial ERP system. This system will replace many of our existing operating and financial systems. The implementation is a major undertaking, both financially and from a management and personnel perspective. Any material disruptions, delays or deficiencies in the design and implementation of our new ERP system could adversely affect our ability to process orders, ship products, provide services and customer support, send invoices and track payments, fulfill contractual obligations or otherwise operate our business.

We may be unable to attract, develop and retain executives and key employees: Our sales, technical and other key personnel play an integral role in the development, marketing and selling of new and existing products. Our future performance also depends in large part on the continued services of our senior management. If we are unable to recruit, hire, develop and retain a talented, competitive work force in our highly competitive industry, or if we are unable to plan effective succession for the future, we may not be able to meet our strategic business objectives. Inflationary pressures, labor demand and shortages and other macroeconomic factors have increased and could further increase the cost of labor and could harm our ability to recruit, hire and retain talented employees. In addition, increased unionization could negatively impact our labor costs and ability to create an engaging, connected culture, which could adversely affect our ability to recruit, hire, develop and retain a talented, competitive workforce. Further, if we are unable to maintain competitive and equitable compensation and benefit programs, including incentive programs which reward financial and operational performance, our ability to recruit, hire, engage, motivate and retain talent could be negatively affected. Additionally, if we are unable to maintain an inclusive culture that aligns our diverse workforce with our mission and values, it could adversely impact our ability to recruit, hire, develop and retain key talent. Further, our remote and hybrid work practices, ability to provide flexible and alternative work arrangements, and our practices relating to corporate responsibility may not meet the needs or expectations of our employees, including senior management or other key employees, which could negatively impact our ability to attract and retain highly skilled employees, or may harm our culture and/or decrease employee engagement,

which could adversely impact our ability to recruit, hire, develop and retain a talented, competitive workforce.

Effective succession planning is also important to our long-term success. Failure to ensure effective transfer of knowledge and smooth transitions involving executives and other key employees could hinder our strategic planning and execution. Changes in our management team may be disruptive to our business, and any failure to successfully integrate key new hires or promoted employees could adversely affect our business and results of operations. The loss of the services of any of our senior management or other key personnel, or our inability to attract highly qualified senior management and other key personnel, could harm our business. Our ability to execute our business strategy could be impaired if we are unable to replace such persons timely. In addition, recent legal and regulatory changes affect our ability to enforce post-termination obligations from certain employees with respect to non-competition, non-solicitation and protection of confidential information. This may negatively impact our ability to retain employees and protect our information and relationships with customers and other third parties.

Interruption of manufacturing operations could adversely affect our business: We and our suppliers have manufacturing and supply sites all over the world. However, the manufacturing of certain of our product lines is concentrated in one or more plants or geographic regions. We have principal manufacturing and distribution facilities in the United States in Arizona, California, Florida, Illinois, Indiana, Michigan, Minnesota, New Jersey, Puerto Rico, Tennessee, Texas, Utah, Virginia and Washington, and outside the United States in China, France, Germany, Ireland, Mexico, the Netherlands, Poland, Switzerland and Turkey. Damage to our facilities, to our suppliers’ or service providers’ facilities, or to our central distribution centers as a result of natural disasters, fires, explosions or otherwise, as well as issues in our manufacturing arising from a failure to follow specific internal protocols and procedures, compliance concerns relating to the quality systems regulation, equipment breakdown or malfunction, IT system failures or cybersecurity incidents, environmental hazard incidents or changes to environmental regulations or other factors, could adversely affect the availability of our products. In the event of an interruption in manufacturing, we may be unable to move quickly to alternate means of producing and distributing affected products to meet customer demand. In the event of a significant interruption, we may experience lengthy delays in resuming production or distribution of affected products due to the need for regulatory approvals, and we may experience loss of market share, additional expense and harm to our reputation.

Our insurance program may not be adequate to cover future losses: We maintain third-party insurance to cover our exposure to certain property and casualty losses and are self-insured for claims and expenses related to other property and casualty losses, including product liability, intellectual property infringement and enforcement, environmental, and cybersecurity and data privacy losses. We manage a portion of our exposure to self-insured losses through a wholly-owned captive insurance company. Insurance coverage limits provided by third-party insurers and/or our captive insurance company may not be sufficient to fully cover certain losses we may experience.

We have experienced, and may continue to experience, a significant and unpredictable need to adjust our operations as market demand for certain of our products has shifted and continues to shift or as may be mandated by governmental authorities: Some of our products are particularly sensitive to reductions in elective medical procedures. Elective medical procedures were suspended or reduced at various times during the COVID-19 pandemic in many of the markets where our products are marketed and sold, which negatively affected

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our business, cash flows, financial condition and results of operations. It is not possible to predict whether elective medical procedures will again be suspended or reduced in the future and, to the extent individuals and customers are required to delay or cancel elective procedures, our business, cash flows, financial condition and results of operations could be negatively affected. Further, our customers have experienced, and could continue to experience, staffing shortages that may result in decreased demand for our products, which could negatively affect our business and financial results.

In addition, during the COVID-19 pandemic our products in certain divisions, such as Medical, experienced higher demand as our customers were focused on treating COVID-19 patients and preparing for future public health emergencies. Unpredictable increases in demand for certain of our products have exceeded in the past, and could exceed in the future, our capacity to meet such demand timely, which could adversely affect our customer relationships and result in negative publicity. In this regard, the accelerated development and production of products and services to address medical and other requirements could increase the risk of regulatory enforcement actions, product defects or related claims or reputational harm.

Pandemics and public health emergencies, and the fear thereof, have in the past materially adversely affected and could in the future materially adversely affect, our operations, supply chain, manufacturing, product distribution, customers and other business activities: In connection with COVID-19, governmental authorities and private enterprises implemented, and may in the future implement in connection with another pandemic or public health emergency (or in response to the fear thereof), measures, such as travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns. Our customers, global suppliers, distributors and manufacturing facilities have in the past been, and could in the future be, materially affected by restrictive measures implemented in response to a pandemic or public health emergency, which has in the past caused and could in the future cause them to be unable to hire and retain employees, distribute or use our products or provide required services. We have as a result experienced, and could in the future experience, delays in, or the suspension of, our manufacturing operations, sales activities, research and product development activities, regulatory work streams, clinical development programs and other important commercial functions, which may result in our inability to satisfy consumer demand for our products in a timely manner or at all and which could harm our reputation, future sales and profitability. The extent of any future pandemic or public health emergency’s effect on our business and industry will depend on, among other things, the severity of the disease, the successful development, distribution and acceptance of vaccines for diseases, future resurgences and/or the spread of disease variants, all of which are uncertain and difficult to predict. The COVID-19 pandemic materially impacted us, and any future pandemic or public health emergency could materially impact us and would heighten many of the other risks described in this report.

LEGAL AND REGULATORY RISKS

Current economic and political conditions make tax rules in jurisdictions subject to significant change: Our future results of operations could be affected by changes in the effective tax rate as a result of changes in tax laws, regulations and judicial rulings. We are continuing to evaluate the impact of tax reform in the countries in which we operate as new guidance is published and new regulations are adopted. In addition, further changes in the tax laws could arise, including as a result of the base erosion and profit shifting project undertaken by the Organisation for Economic Cooperation and Development (OECD). The OECD, which represents a coalition of member countries, has put forth

two proposed frameworks—Pillar One and Pillar Two—that revise the existing profit allocation and nexus rules and ensure a minimal level of taxation, respectively. On December 12, 2022, the European Union member states agreed to implement the Inclusive Framework’s global corporate minimum tax rate of 15%, and various countries (both within and outside the European Union) have enacted new laws implementing Pillar Two or have proposed legislation. The OECD continues to release additional guidance on the two-pillar framework, with widespread implementation anticipated by 2024. These changes, and any additional contemplated changes, could increase tax expense.

We could be negatively impacted by future changes in the allocation of income to each of the income tax jurisdictions in which we operate: We operate in multiple income tax jurisdictions both in the United States and internationally. Accordingly, our management must determine the appropriate allocation of income to each jurisdiction based on current interpretations of complex income tax regulations. Income tax authorities regularly perform audits of our income tax filings. Income tax audits associated with the allocation of income and other complex issues, including inventory transfer pricing and cost sharing, product royalty and foreign branch arrangements, may require an extended period to resolve and may result in significant income tax adjustments.

The impact of healthcare reform legislation on our business remains uncertain: Several markets where we sell our products are making efforts to expand access to health care or health insurance coverage while decreasing costs. These efforts may have a direct or unintended negative impact on access to medical technology and could have a significant effect on our business. We cannot predict what healthcare programs and regulations could ultimately be implemented at the federal or state level or the effect that any future legislation or regulation in the United States may have on our business. Similarly, we cannot predict the impact that healthcare reform legislation in other countries where we sell our products may have on our business.

We are subject to extensive governmental regulation relating to the classification, manufacturing, sterilization, licensing, labeling, marketing and sale of our products: The classification, manufacturing, sterilization, licensing, labeling, marketing and sale of our products are subject to extensive and evolving regulations and rigorous regulatory enforcement by the FDA, state governments, European Union and other governmental authorities in the United States and internationally. These governmental authorities may impose additional requirements or limits on the methods, procedures or agents we use to manufacture and sterilize our products, which could have a negative impact on our business. In addition, the process of obtaining licenses, regulatory clearances and/or approvals to market and sell our products can be costly and time consuming and the clearances and/or approvals might not be granted timely. We have ongoing responsibilities under the laws and regulations applicable to the manufacturing of products within our facilities and those contracted by third parties that are subject to periodic inspections by the FDA, state Boards of Pharmacy and other governmental authorities to determine compliance with the quality system, medical device reporting regulations and other requirements. We incur significant costs to comply with regulations, including the MDR. If we fail to comply with applicable regulatory requirements, we may be subject to a range of sanctions, including substantial fines, warning letters that require corrective action, product seizures, recalls, import restrictions, the suspension of product manufacturing or sales, revocation of approvals, exclusion from future participation in government healthcare programs, substantial fines and criminal prosecution.

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We are subject to federal, state and foreign healthcare regulations, including anti-bribery, anti-corruption, anti-kickback and false claims laws, globally and could face substantial penalties if we fail to comply with such regulations and laws: The relationships that we, and third parties that market and/or sell our products, have with healthcare professionals, such as physicians, hospitals, healthcare organizations and others, are subject to scrutiny under various state and federal laws often referred to collectively as healthcare fraud and abuse laws. In addition, the United States and foreign government regulators have increased the enforcement of the Foreign Corrupt Practices Act (FCPA) and other anti-bribery and anti-kickback laws. We also must comply with a variety of other laws that impose extensive tracking and reporting related to all transfers of value provided to certain healthcare professionals and others. These laws and regulations are broad in scope and are subject to evolving interpretation and we have in the past been, and in the future could be, required to incur substantial costs to investigate, audit and monitor compliance or to alter our practices. Violations or alleged violations of these laws could result in litigation and we may be subject to criminal or civil penalties and sanctions, including substantial fines, imprisonment of current or former employees and exclusion from participation in governmental healthcare programs. In 2013 and 2018 we settled claims brought by the SEC related to the FCPA. Pursuant to these settlements, we paid fines and penalties and retained an independent compliance consultant. We continue to implement recommendations that resulted from the independent compliance consultant’s review of our commercial practices to enhance our commercial business practices. In addition, we are currently investigating whether certain business activities in certain foreign countries violated provisions of the FCPA and have been contacted by the SEC, United States Department of Justice and certain other regulatory authorities. Although we are currently unable to predict the outcome of the investigations or the potential impact, if any, on our financial statements, the impacts could potentially be significant.

We are subject to privacy, data protection and data security regulations and laws globally, and could face substantial penalties if we fail to comply with such regulations and laws: We are subject to a variety of laws and regulations globally regarding privacy, data protection, and data security, including those related to the collection, storage, handling, use, disclosure, transfer and security of personally identifiable healthcare information. For example, in the United States, privacy and security regulations under the Health Insurance Portability and Accountability Act of 1996, including the expanded requirements under the Health Information Technology for Economic and Clinical Health Act of 2009, establish comprehensive standards with respect to the use and disclosure of protected health information (PHI), by covered entities, in addition to setting standards to protect the confidentiality, integrity and security of PHI. Regulators are also imposing new data privacy and security requirements, including new and greater monetary fines for privacy violations. For example, the European Union’s General Data Protection Regulation (GDPR) established rules regarding the handling of personal data. Non-compliance with the GDPR may result in monetary penalties of up to 4% of total company revenue. Various U.S. states and other governmental authorities around the world have imposed or are considering similar types of laws and regulations, data breach reporting and penalties for non-compliance and increasing security requirements. These laws and regulations are broad in scope and are subject to evolving interpretation and we have in the past been, and in the future could be, required to incur substantial costs to monitor compliance or to alter our practices. As new privacy-related laws and regulations are implemented, the time and resources needed for us to comply with such laws and regulations, as well as our potential liability for non-compliance and reporting obligations in

the case of data breaches, have increased and may further increase.

We may be adversely affected by product liability claims, unfavorable court decisions or legal settlements: We are exposed to potential product liability risks inherent in the design, manufacture and marketing of medical devices, many of which are implanted in the human body for long periods of time or indefinitely. We are currently defendants in a number of product liability matters, including those relating to our Rejuvenate and ABGII Modular-Neck hip stems, LFIT Anatomic CoCr V40 Femoral Heads and the product liability lawsuits and claims relating to Wright Medical Group N.V. (Wright) legacy hip products discussed in Note 7 to our Consolidated Financial Statements. These matters are subject to uncertainties and outcomes are not predictable. Further, the European Representative Actions Directive (the Collective Redress Directive), which became effective in 2023, mandates a class action regime in each EU member state to facilitate domestic and cross-border class actions in a wide range of areas, including product liability claims with medical devices. The Collective Redress Directive could result in additional litigation risks and significant legal expenses. In addition, we may incur significant legal expenses or reputational damage for product liability claims regardless of whether we are found to be liable.

Intellectual property litigation and infringement claims could cause us to incur significant expenses or prevent us from selling certain of our products: The medical device industry is characterized by extensive intellectual property litigation and, from time to time, we are the subject of claims of infringement or misappropriation. Regardless of the outcome, such claims are expensive to defend and divert management and operating personnel from other business issues. A successful claim or claims of patent or other intellectual property infringement against us could result in payment of significant monetary damages and/or royalty payments or negatively impact our ability to sell current or future products in the affected category.

Dependence on patent and other proprietary rights and failing to protect such rights or to be successful in litigation related to such rights may impact offerings in our product portfolios: Our long-term success largely depends on our ability to market technologically competitive products. If we fail to obtain or maintain adequate intellectual property protection, it could allow others to sell products that directly compete with proprietary features in our product portfolio. Also, our issued patents may be subject to claims challenging their validity and scope and raising other issues. In addition, currently pending or future patent applications may not result in issued patents.

MARKET RISKS

We have exposure to exchange rate fluctuations on cross border transactions and translation of local currency results into United States Dollars: We report our financial results in United States Dollars and approximately 25% of our net sales are denominated in foreign currencies, including the Australian Dollar, British Pound, Canadian Dollar, Euro and Japanese Yen. Cross border transactions with external parties and intercompany relationships result in increased exposure to foreign currency exchange effects. While we use derivative instruments to manage the impact of currency exchange, our hedging strategies may not be successful, and our unhedged exposures continue to be subject to currency fluctuations. In addition, the weakening or strengthening of the United States Dollar results in favorable or unfavorable translation effects when the results of our foreign locations are translated into United States Dollars.

Additional capital that we may require in the future may not be available to us or may only be available to us on unfavorable terms, which could negatively affect our liquidity: Our future capital requirements will depend on many factors, including operating requirements, current and future

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acquisitions and the need to refinance existing debt. Our ability to issue additional debt or enter into other financing arrangements on acceptable terms could be adversely affected by our debt levels, unfavorable changes in economic conditions or uncertainties that affect the capital markets. Changes in credit ratings issued by nationally recognized credit rating agencies could also adversely affect our access to and cost of financing. Higher borrowing costs or the inability to access capital markets could adversely affect our ability to support future growth and operating requirements. In addition, we have experienced, and could in the future experience, loss of sales and profits due to delayed payments or insolvency of healthcare professionals, hospitals and other customers and suppliers facing liquidity issues due to the current macroeconomic environment, type and number of conditions being treated or for other reasons. As a result, we may be compelled to take additional measures to preserve our cash flow, including through the reduction of operating expenses or suspension of dividend payments.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE RISKS

We could be negatively impacted by corporate responsibility and sustainability-related matters: Governments, investors, customers, employees and other stakeholders have been increasingly focused on corporate responsibility practices and disclosures, and expectations in this area continue to rapidly evolve. On occasion, we announce new initiatives, including goals, under our corporate responsibility framework. This framework is aligned with our areas of interest, which include environment and sustainability, social impact, diversity, equity and inclusion and supply chain management, among others. Implementation of these goals and initiatives involves risks and uncertainties, requires investments and depends in part on third-party performance or data that is outside our control. We cannot guarantee that we will achieve our announced corporate responsibility goals and initiatives. The criteria by which our corporate responsibility practices are assessed may change due to the quickly evolving landscape, which could result in greater regulatory requirements or expectations of us and cause us to undertake costly initiatives to satisfy such new criteria. Moreover, the increasing attention to corporate responsibility initiatives could also result in reduced demand for our products, reduced profits and increased investigations and litigation. If we are unable to satisfy evolving criteria, investors and other stakeholders may conclude that our policies and/or actions with respect to corporate responsibility matters are inadequate. If we fail or are perceived to have failed to achieve previously announced initiatives or goals, comply with corporate responsibility laws and regulations, meet evolving expectations or accurately disclose our progress, we could face legal and regulatory proceedings and our reputation, business, financial condition and results of operations could be adversely impacted.

Physical effects of climate change or legal, regulatory or market measures intended to address climate change could adversely affect our operations and operating results: Risks associated with climate change are subject to increasing societal, regulatory and political focus in the United States and globally. Shifts in weather patterns caused by climate change are expected to increase the frequency, severity or duration of certain adverse weather conditions and natural disasters, such as hurricanes, tornadoes, earthquakes, wildfires, droughts, extreme temperatures or flooding, which could cause more significant business and supply chain interruptions, damage to our products and facilities as well as the infrastructure of hospitals, medical care facilities and other customers, reduced workforce availability, increased costs of raw materials and components, increased liabilities and decreased revenues than what we have experienced in the past from such events. In addition, increased public concern over climate change has resulted in certain, and could result in additional, new legal or regulatory requirements

designed to mitigate the effects of climate change, which could include the adoption of more stringent environmental laws and regulations or stricter enforcement of existing laws and regulations. Such developments could result in increased compliance costs and adverse impacts on raw material availability and sourcing, manufacturing operations and the distribution of our products, which could adversely affect our operations and operating results.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

None.

ITEM 1C. CYBERSECURITY.

RISK MANAGEMENT AND STRATEGY

We review cybersecurity risk as part of our overall enterprise risk management program. This ensures that cybersecurity risk management remains a top priority in our business strategy and operations.

MANAGEMENT'S ROLE IN MANAGING RISK

Primary management responsibility for assessing, monitoring and managing our cybersecurity risks rests with our chief information security officer ("CISO"). Our current CISO has over 30 years of experience in information technology including over 20 years in cybersecurity and oversees a team of cybersecurity professionals with over 140 security, risk, and compliance certifications. The CISO is regularly informed about recent developments in cybersecurity, including potential threats and innovative risk management techniques.

The CISO implements and oversees processes for the regular monitoring of our information systems. We use various tools and methodologies to manage cybersecurity risk that are tested regularly. We also monitor and evaluate our cybersecurity posture and performance on an ongoing basis through regular vulnerability scans, penetration tests and threat intelligence feeds. In addition, we engage third-party consultants to conduct annual cybersecurity assessments and to conduct audits for compliance with regulatory, Sarbanes-Oxley Act, Service Organization Control Type 2 and International Organization for Standardization standards. We also engage third parties to assess our cybersecurity maturity and risk management programs.

We use a cross-departmental approach to addressing cybersecurity risk, with our cybersecurity, product security and legal teams presenting quarterly on key topics to a committee of leaders in finance, regulatory, and corporate affairs functions. This leadership committee meets quarterly to ensure that we have input and oversight from critical stakeholders into our cybersecurity program and evolving issues.

The CISO oversees a training and awareness program for employees to take part in protecting the Company against cybersecurity risks. We have implemented annual mandatory security education to help employees understand cybersecurity risks and comply with our cybersecurity policies. Additionally, we provide frequent communications around pertinent cybersecurity topics and policies to all employees. We also provide additional cybersecurity and data protection training to employees in certain roles.

As part of our cybersecurity risk management program, we also conduct cybersecurity and privacy assessments on all third parties who integrate with Stryker’s data, network, systems and products. We use a combination of internal and external tools to confirm that these third parties meet our security requirements. We leverage standard industry threat model and privacy impact assessment concepts to confirm that data minimization and adequate data protections are in place. We perform supplemental reviews as necessary, commensurate with the risk associated with each vendor.

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In the event of a cybersecurity incident, we have an incident response plan that includes immediate actions to mitigate the impact and long-term strategies for remediation and prevention of future incidents. The cybersecurity and product security teams routinely practice this plan with functions across the organization. We conduct tabletop exercises with senior management, during which we practice the procedures in place to ensure that potentially material cybersecurity risks and incidents are escalated to management and the Board of Directors where applicable.

GOVERNANCE

Cybersecurity risks are overseen by the full Board of Directors and the Audit Committee. The Audit Committee is central to the Board of Directors’ oversight of cybersecurity risks and bears the primary responsibility for overseeing cybersecurity risk. The Audit Committee actively participates in strategic decisions related to cybersecurity, offering guidance and approval for major cybersecurity initiatives. This involvement ensures that cybersecurity considerations are integrated into our broader strategic objectives.

Our CISO provides comprehensive updates to the Audit Committee quarterly and the full Board of Directors at least annually. These briefings include a range of topics, including:

•Current cybersecurity landscape and emerging threats;

•Status of ongoing cybersecurity initiatives and strategies;

•Incident reports and learnings from any cybersecurity events;

•Metrics demonstrating company and industry-standard prevention of common threats; and

•Regulatory changes impacting cybersecurity requirements and strategy.

The Board of Directors is aware of the critical nature of managing risks associated with cybersecurity threats and is actively engaged in our cybersecurity risk management strategy.

RISKS FROM CYBERSECURITY THREATS

Although cybersecurity risks have not materially affected us, including our business strategy, results of operations or financial condition, to date, we face numerous and evolving cybersecurity threats in our business. For more information about the cybersecurity risks we face, see the risk factor entitled "We, our business partners or our third-party vendors could experience a material failure or breach of a key information technology system, network, process or site" in Item 1A. Risk Factors.

ITEM 2. PROPERTIES.

We have approximately 28 company-owned and 294 leased locations worldwide including 43 manufacturing locations. We believe that our properties are in good operating condition and adequate for the manufacture and distribution of our products. We do not anticipate difficulty in renewing existing leases as they expire or in finding alternative facilities.

ITEM 3. LEGAL PROCEEDINGS.

We are involved in various proceedings, legal actions and claims arising in the normal course of business, including proceedings related to product, labor and intellectual property, and the matters described in more detail in Note 7 to our Consolidated Financial Statements.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

PART II

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Our common stock is traded on the New York Stock Exchange under the symbol SYK.

Our Board of Directors considers payment of cash dividends at its quarterly meetings. On January 31, 2024 there were 2,501 shareholders of record of our common stock.

We did not repurchase any shares in the three months ended December 31, 2023 and the total dollar value of shares that could be acquired under our authorized repurchase program at December 31, 2023 was $1,033.

In the fourth quarter 2023 we issued 5 shares of our common stock as performance incentive awards to employees. These shares were not registered under the Securities Act of 1933 based on the conclusion that the awards were not events of sale within the meaning of Section 2(a)(3) of the Act.

The following graph compares our total returns (including reinvestment of dividends) against the Standard & Poor’s (S&P) 500 Index and the S&P 500 Health Care Index. The graph assumes $100 (not in millions) invested on December 31, 2018 in our common stock and each of the indices.

Company / Index	2018		2019		2020		2021		2022		2023
Stryker Corporation	$	100.00	$	135.33	$	159.91	$	176.26	$	163.19	$	202.03
S&P 500 Index	$	100.00	$	131.49	$	155.68	$	200.37	$	164.08	$	207.21
S&P 500 Health Care Index	$	100.00	$	120.82	$	137.07	$	172.89	$	169.51	$	173.00

Dollar amounts in millions except per share amounts or as otherwise specified. 11

STRYKER CORPORATION 2023 FORM 10-K

ITEM 6. SELECTED FINANCIAL DATA.

Statement of Earnings Data	2023		2022		2021		2020		2019
Net sales	$	20,498	$	18,449	$	17,108	$	14,351	$	14,884
Cost of sales	7,440		6,871		6,140		5,294		5,188
Gross profit	$	13,058	$	11,578	$	10,968	$	9,057	$	9,696
Research, development and engineering expenses	1,388		1,454		1,235		984		971
Selling, general and administrative expenses	7,129		6,455		6,427		5,361		5,356
Recall charges, net	18		(15)		103		17		192
Amortization of intangible assets	635		627		619		472		464
Goodwill impairment	—		216		—		—		—
Total operating expenses	$	9,170	$	8,737	$	8,384	$	6,834	$	6,983
Operating income	$	3,888	$	2,841	$	2,584	$	2,223	$	2,713
Other income (expense), net	(215)		(158)		(303)		(269)		(151)
Earnings before income taxes	$	3,673	$	2,683	$	2,281	$	1,954	$	2,562
Income taxes	508		325		287		355		479
Net earnings	$	3,165	$	2,358	$	1,994	$	1,599	$	2,083
Net earnings per share of common stock:
Basic	$	8.34	$	6.23	$	5.29	$	4.26	$	5.57
Diluted	$	8.25	$	6.17	$	5.21	$	4.20	$	5.48
Dividends declared per share of common stock	$	3.050	$	2.835	$	2.585	$	2.355	$	2.135
Balance Sheet Data
Cash, cash equivalents and current marketable securities	$	3,053	$	1,928	$	3,019	$	3,024	$	4,425
Accounts receivable, net	3,765		3,565		3,022		2,701		2,893
Inventories	4,843		3,995		3,314		3,494		2,980
Property, plant and equipment, net	3,215		2,970		2,833		2,752		2,567
Total assets	$	39,912	$	36,884	$	34,631	$	34,330	$	30,167
Accounts payable	1,517		1,413		1,129		810		675
Total debt	12,995		13,048		12,479		13,991		11,090
Shareholders’ equity	$	18,593	$	16,616	$	14,877	$	13,084	$	12,807
Cash Flow Data
Net cash provided by operating activities	$	3,711	$	2,624	$	3,263	$	3,277	$	2,191
Purchases of property, plant and equipment	575		588		525		487		649
Depreciation	393		371		371		340		314
Acquisitions, net of cash acquired	390		2,563		339		4,222		802
Amortization of intangible assets	635		627		619		472		464
Payments of dividends	1,139		1,051		950		863		778
Repurchase of common stock	—		—		—		—		307
Other Data
Number of shareholders of record	2,518		2,533		2,551		2,597		2,636
Approximate number of employees	52,000		51,000		46,000		43,000		40,000

Dollar amounts in millions except per share amounts or as otherwise specified. 12

STRYKER CORPORATION 2023 FORM 10-K

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

About Stryker

Stryker is a global leader in medical technologies and, together with our customers, we are driven to make healthcare better. We offer innovative products and services in MedSurg, Neurotechnology, Orthopaedics and Spine that help improve patient and healthcare outcomes. Alongside our customers around the world, we impact more than 150 million patients annually. Our goal is to achieve sales growth at the high-end of the medical technology (MedTech) industry and maintain our long-term capital allocation strategy that prioritizes: (1) Acquisitions, (2) Dividends and (3) Share repurchases.

Macroeconomic Environment

The global economy continues to experience increased inflationary pressures in part due to global supply chain disruptions, labor shortages and other impacts of the macroeconomic environment which we anticipate will continue. Higher interest rates and capital costs, higher shipping costs, increased costs of labor, fluctuating foreign currency exchange rates and the military conflicts in Russia and Ukraine and the Middle East create additional economic challenges and uncertainties. These conditions may cause our customers to decrease or delay orders for our products and services, and the higher interest rates may impact deal mix for our capital products.

Overview of 2023

In 2023 we achieved reported net sales growth of 11.1%. Excluding the impact of acquisitions and divestitures, sales grew 11.5% in constant currency. We reported net earnings of $3,165 and net earnings per diluted share of $8.25. Excluding the impact

of certain items, we achieved adjusted net earnings(1) of $4,066 and adjusted net earnings per diluted share(1) of $10.60 representing growth of 13.5%.

We continued our capital allocation strategy by investing $390 in acquisitions and paying $1,139 in dividends to our shareholders.

In May 2023 we acquired Cerus for net cash consideration of $289 and up to $225 in future milestone payments. Cerus designs, develops and manufactures neurovascular products used for the treatment of hemorrhagic stroke. Cerus is part of our Neurovascular business within MedSurg and Neurotechnology. Refer to Note 6 to our Consolidated Financial Statements for further information.

During 2023 we made payments of $850 to extinguish the remaining balance on the $1.5 billion term loan scheduled to mature February 22, 2025.

In August 2023 we issued €500 of floating rate senior notes due November 16, 2024. The notes bear interest at a rate based on the three-month Euro Interbank Offered Rate (EURIBOR) plus 0.3%. The notes are callable at February 16, 2024, May 16, 2024 or October 16, 2024 either by us or at the option of the notes holders.

In November 2023 we repaid the outstanding €550 principal amount of 1.125% senior unsecured notes due November 30, 2023 and in December 2023 we repaid the outstanding $600 principal amount of 0.600% senior unsecured notes due December 1, 2023. We subsequently issued $600 of 4.850% senior unsecured notes due December 8, 2028 and €600 of 3.375% senior unsecured notes due December 11, 2028.

(1)    Refer to "Non-GAAP Financial Measures" for a discussion of non-GAAP financial measures used in this report and a reconciliation to the most directly comparable GAAP financial measure.

CONSOLIDATED RESULTS OF OPERATIONS

							Percent Net Sales						Percentage Change
	2023		2022		2021		2023		2022		2021		2023 vs. 2022		2022 vs. 2021
Net sales	$	20,498	$	18,449	$	17,108	100.0	%	100.0	%	100.0	%	11.1	%	7.8	%
Gross profit	13,058		11,578		10,968		63.7		62.8		64.1		12.8		5.6
Research, development and engineering expenses	1,388		1,454		1,235		6.8		7.9		7.2		(4.5)		17.7
Selling, general and administrative expenses	7,129		6,455		6,427		34.8		35.0		37.6		10.4		0.4
Recall charges, net	18		(15)		103		0.1		(0.1)		0.6		nm		nm
Amortization of intangible assets	635		627		619		3.1		3.4		3.6		1.3		1.3
Goodwill impairment	—		216		—		—		1.2		—		nm		nm
Other income (expense), net	(215)		(158)		(303)		(1.0)		(0.9)		(1.8)		36.1		(47.9)
Income taxes	508		325		287		nm		nm		nm		56.3		13.2
Net earnings	$	3,165	$	2,358	$	1,994	15.4	%	12.8	%	11.7	%	34.2	%	18.3	%
Net earnings per diluted share	$	8.25	$	6.17	$	5.21							33.7	%	18.4	%
Adjusted net earnings per diluted share(1)	$	10.60	$	9.34	$	9.09							13.5	%	2.8	%

nm - not meaningful

Dollar amounts in millions except per share amounts or as otherwise specified. 13

STRYKER CORPORATION 2023 FORM 10-K

Geographic and Segment Net Sales							Percentage Change
							2023 vs. 2022				2022 vs. 2021
	2023		2022		2021		As Reported		Constant Currency		As Reported		Constant Currency
Geographic:
United States	$	15,257	$	13,638	$	12,321	11.9	%	11.9	%	10.7	%	10.7	%
International	5,241		4,811		4,787		8.9		10.9		0.5		11.7
Total	$	20,498	$	18,449	$	17,108	11.1	%	11.6	%	7.8	%	11.0	%
Segment:
MedSurg and Neurotechnology	$	11,836	$	10,611	$	9,538	11.5	%	12.1	%	11.2	%	14.1	%
Orthopaedics and Spine	8,662		7,838		7,570		10.5		11.1		3.5		7.0
Total	$	20,498	$	18,449	$	17,108	11.1	%	11.6	%	7.8	%	11.0	%

Supplemental Net Sales Growth Information
							Percentage Change
							2023 vs. 2022										2022 vs. 2021
											United States		International								United States		International
	2023		2022		2021		As Reported		Constant Currency		As Reported		As Reported		Constant Currency		As Reported		Constant Currency		As Reported		As Reported		Constant Currency
MedSurg and Neurotechnology:
Instruments	$	2,569	$	2,279	$	2,111	12.7	%	13.0	%	13.3	%	10.4	%	11.8	%	8.0	%	10.4	%	10.6	%	(0.9)	%	10.0	%
Endoscopy	3,033		2,725		2,418		11.3		11.7		12.1		7.6		9.9		12.7		15.2		13.8		8.3		20.9
Medical	3,459		3,031		2,607		14.1		14.4		15.0		10.8		12.3		16.2		18.6		20.6		1.5		11.7
Neurovascular	1,226		1,200		1,188		2.1		4.0		8.1		(1.4)		1.5		1.1		7.2		(0.9)		2.3		12.2
Neuro Cranial	1,549		1,376		1,214		12.6		13.0		11.9		16.1		18.4		13.3		15.4		14.9		6.1		17.5
	$	11,836	$	10,611	$	9,538	11.5	%	12.1	%	13.0	%	7.0	%	9.1	%	11.2	%	14.1	%	14.2	%	3.0	%	13.8	%
Orthopaedics and Spine:
Knees	$	2,273	$	1,997	$	1,848	13.9	%	14.4	%	12.2	%	18.8	%	20.9	%	8.0	%	11.2	%	10.6	%	1.0	%	12.9	%
Hips	1,544		1,413		1,342		9.2		10.4		10.1		7.7		10.7		5.3		10.1		9.1		(0.6)		11.5
Trauma and Extremities	3,147		2,807		2,664		12.1		12.2		12.9		10.1		10.5		5.4		8.7		9.0		(3.2)		8.0
Spine	1,189		1,146		1,167		3.8		4.0		5.7		(1.6)		(0.9)		(1.8)		1.1		0.6		(7.7)		2.4
Other	509		475		549		7.1		8.8		(2.0)		33.8		40.9		(13.3)		(10.3)		(16.9)		(0.9)		12.8
	$	8,662	$	7,838	$	7,570	10.5	%	11.1	%	10.2	%	11.2	%	13.0	%	3.5	%	7.0	%	6.0	%	(2.2)	%	9.3	%
Total	$	20,498	$	18,449	$	17,108	11.1	%	11.6	%	11.9	%	8.9	%	10.9	%	7.8	%	11.0	%	10.7	%	0.5	%	11.7	%

Note: Beginning in the first quarter 2023 we consolidated Other MedSurg and Neurotechnology into Endoscopy as Other MedSurg and Neurotechnology (primarily Sustainability Solutions) has been fully integrated into our Endoscopy business. Endoscopy includes sales related to Other of $343, $302 and $277 for 2023, 2022 and 2021. We have reflected these changes in all historical periods presented.

Consolidated Net Sales

Consolidated net sales in 2023 increased 11.1% as reported and 11.6% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.5%. Excluding the 0.1% impact of acquisitions and divestitures, net sales in constant currency increased by 10.9% from increased unit volume and 0.6% due to higher prices. The unit volume increase was primarily due to higher shipments across all product lines.

Consolidated net sales in 2022 increased 7.8% as reported and 11.0% in constant currency, as foreign currency exchange rates negatively impacted net sales by 3.2%. Excluding the 1.3% impact of acquisitions and divestitures, net sales in constant currency increased by 10.6% from increased unit volume partially offset by 0.9% due to lower prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology products and most Orthopaedics and Spine products.

MedSurg and Neurotechnology Net Sales

MedSurg and Neurotechnology net sales in 2023 increased 11.5% as reported and 12.1% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.6%. Excluding the 0.3% impact of acquisitions and divestitures, net sales in constant currency increased by 10.2% from increased unit volume and 1.6% due to higher prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology products.

MedSurg and Neurotechnology net sales in 2022 increased 11.2% as reported and 14.1% in constant currency, as foreign currency exchange rates negatively impacted net sales by 2.9%. Excluding the 2.3% impact of acquisitions and divestitures, net sales in constant currency increased by 11.2% from increased unit volume and 0.6% due to higher prices. The unit volume increase was due to higher shipments across all MedSurg and Neurotechnology products.

Orthopaedics and Spine Net Sales

Orthopaedics and Spine net sales in 2023 increased 10.5% as reported and 11.1% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.6%. Net sales in constant currency increased by 11.9% from increased unit volume partially offset by 0.8% due to lower prices. The unit volume increase was due to higher shipments across all Orthopaedics and Spine products.

Orthopaedics and Spine net sales in 2022 increased 3.5% as reported and 7.0% in constant currency, as foreign currency exchange rates negatively impacted net sales by 3.5%. Net sales in constant currency increased by 9.9% from increased unit volume partially offset by 2.9% due to lower prices. The unit volume increase was due to higher shipments across most Orthopaedics and Spine products.

Gross Profit

Gross profit was $13,058, $11,578 and $10,968 in 2023, 2022, and 2021. The key components of the change were:

Dollar amounts in millions except per share amounts or as otherwise specified. 14

STRYKER CORPORATION 2023 FORM 10-K

	Gross Profit Percent Net Sales
2021	64.1	%
Sales pricing	(30) bps
Volume and mix	110 bps
Manufacturing and supply chain costs	(360) bps
Inventory stepped up to fair value	150 bps
2022	62.8	%
Sales pricing	20 bps
Volume and mix	100 bps
Manufacturing and supply chain costs	(40) bps
Inventory stepped up to fair value	10 bps
2023	63.7	%

Gross profit as a percentage of net sales increased to 63.7% in 2023 from 62.8% in 2022 due to higher sales pricing and favorable volume offset by higher manufacturing and supply chain costs primarily due to higher raw material costs in the first six months of 2023 and supply chain inefficiencies.

Gross profit as a percentage of net sales decreased to 62.8% in 2022 from 64.1% in 2021 due to higher manufacturing and supply chain costs primarily due to increased costs from purchases of electronic components at premium prices on the spot market and other inflationary pressures, primarily related to labor, steel and transportation, as well as inefficiencies from supply chain disruptions partially offset by favorable volume and lower amortization of inventory stepped up to fair value.

While segment mix was not a significant driver of the change in gross profit as a percent of net sales between 2023, 2022 and 2021, we generally expect segment mix to have an unfavorable impact for the foreseeable future as we anticipate more rapid sales growth in our lower gross margin MedSurg and Neurotechnology segment than our Orthopaedics and Spine segment.

Research, Development and Engineering Expenses

Research, development and engineering expenses as a percentage of net sales in 2023 decreased to 6.8% from 7.9% in 2022 primarily due to increased spending for product launches, the write-off of certain intangible assets and higher spend related to medical device regulations in the European Union in 2022.

Research, development and engineering expenses as a percentage of net sales in 2022 increased to 7.9% from 7.2% in 2021 primarily due to increased spending for product launches, the write-off of certain intangible assets and higher spend related to the new medical device regulations in the European Union in 2022.

Selling, General and Administrative Expenses

Selling, general and administrative expenses as a percentage of net sales in 2023 decreased to 34.8% from 35.0% in 2022 primarily due to charges of $132 related to share-based awards for Vocera employees that vested upon our acquisition in 2022, partially offset by disciplined increases in spend and investments in 2023 to support our growth, including sales growth incentives and increased spend on travel and meetings. In addition, in 2022 we determined that certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded $110 to reduce the fair value of contingent consideration.

Selling, general and administrative expenses as a percentage of net sales in 2022 decreased to 35.0% from 37.6% in 2021. Both 2022 and 2021 included charges related to certain asset impairments. Refer to Note 15 to our Consolidated Financial Statements for further information. In 2022 we determined that

certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded $110 to reduce the fair value of contingent consideration. In addition, we recorded charges of $132 related to share-based awards for Vocera employees that vested upon our acquisition in 2022.

Recall Charges, Net

Recall charges, net were $18, ($15) and $103 in 2023, 2022 and 2021. Charges in 2021 were primarily due to the previously disclosed Rejuvenate and ABGII Modular-Neck hip stems and LFIT Anatomic CoCr V40 Femoral Heads voluntary recalls. Refer to Note 7 to our Consolidated Financial Statements for further information.

Amortization of Intangible Assets

Amortization of intangible assets was $635, $627 and $619 in 2023, 2022 and 2021. These amounts include amortization related to intangible assets acquired in the second quarter 2023 from Cerus and in the first quarter 2022 from Vocera. Refer to Notes 6 and 8 to our Consolidated Financial Statements for further information.

Goodwill Impairment

In 2022 we recorded a goodwill impairment charge of $216 related to our Spine business. Refer to Note 8 to our Consolidated Financial Statements for further information.

Operating Income

Operating income was $3,888, $2,841 and $2,584 in 2023, 2022 and 2021. Operating income increased as a percentage of sales to 19.0% in 2023 from 15.4% in 2022 and from 15.1% in 2021. Refer to the comments above for discussion of the primary drivers of the change.

MedSurg and Neurotechnology operating income as a percentage of net sales increased to 28.2% in 2023 from 25.8% in 2022. MedSurg and Neurotechnology operating income as a percentage of net sales decreased to 25.8% in 2022 from 29.4% in 2021. Orthopaedics and Spine operating income as a percentage of net sales decreased to 27.7% in 2023 from 29.3% in 2022. Orthopaedics and Spine operating income as a percentage of net sales increased to 29.3% in 2022 from 28.8% in 2021. The key components of the change were:

	Operating Income Percent Net Sales
	MedSurg and Neurotechnology		Orthopaedics and Spine
2021	29.4	%	28.8	%
Sales pricing	40 bps		(210) bps
Volume	440 bps		440 bps
Manufacturing and supply chain costs	(570) bps		(80) bps
Research, development and engineering expenses	(70) bps		(40) bps
Selling, general and administrative expenses	(200) bps		(60) bps
2022	25.8	%	29.3	%
Sales pricing	120 bps		(60) bps
Volume	390 bps		540 bps
Manufacturing and supply chain costs	100 bps		(170) bps
Research, development and engineering expenses	(20) bps		(40) bps
Selling, general and administrative expenses	(350) bps		(430) bps
2023	28.2	%	27.7	%

The increase in MedSurg and Neurotechnology operating income as a percentage of net sales in 2023 from 2022 was primarily driven by higher unit volumes, higher prices and lower

Dollar amounts in millions except per share amounts or as otherwise specified. 15

STRYKER CORPORATION 2023 FORM 10-K

manufacturing and supply chain costs due to supply chain challenges impacting capital products in our MedSurg businesses in 2022 which improved in 2023 partially offset by higher selling, general and administrative expenses due to continued investments including sales growth incentives and a more normalized cadence of travel and meetings.

The decrease in MedSurg and Neurotechnology operating income as a percentage of net sales in 2022 from 2021 was primarily driven by higher manufacturing and supply chain costs due to supply chain challenges impacting capital products in our MedSurg businesses and higher selling, general and administrative expenses due to a return to more normal levels following the COVID pandemic partially offset by higher unit volumes and prices.

The decrease in Orthopaedics and Spine operating income as a percentage of net sales for 2023 from 2022 was primarily driven by higher selling, general and administrative expenses due to continued investments including sales growth incentives and a more normalized cadence of travel and meetings and higher manufacturing and supply chain costs primarily due to increased inventory reserves partially offset by higher unit volumes.

The increase in Orthopaedics and Spine operating income as a percentage of net sales for 2022 from 2021 was primarily driven by higher unit volumes partially offset by lower prices.

Other Income (Expense), Net

Other income (expense), net was ($215), ($158) and ($303) in 2023, 2022 and 2021. The increase in net expense in 2023 compared to 2022 was primarily due to the release of accrued interest of $50 in 2022 related to the effective settlement of the United States federal income tax audit for years 2014 through 2018. Refer to Note 11 to our Consolidated Financial Statements for further information. The decrease in net expense in 2022 compared to 2021 was primarily due to the aforementioned release of accrued interest and higher interest income in 2022.

Income Taxes

Our effective tax rate was 13.8%, 12.1% and 12.6% for 2023, 2022 and 2021. The effective income tax rate for 2023 increased from 2022 due to the 2022 effective settlement of the United States federal income tax audit for years 2014 through 2018 and the 2022 reversal of deferred income tax on undistributed earnings of foreign subsidiaries partially offset by the 2023 tax effect related to transfers of intellectual property between tax jurisdictions. The effective income tax rate for 2022 decreased from 2021 due to the 2022 effective settlement of the United States federal income tax audit for years 2014 through 2018 and the 2022 reversal of deferred income tax on undistributed earnings of foreign subsidiaries. The effective income tax rates for 2023, 2022 and 2021 reflect the continued lower effective income tax rates as a result of our European operations, the tax effect related to the transfers of intellectual property between tax jurisdictions, the tax effect of future remittances of the undistributed earnings of foreign subsidiaries and certain discrete tax items.

Net Earnings

Net earnings for 2023 increased to $3,165 or $8.25 per diluted share from $2,358 or $6.17 per diluted share in 2022 and $1,994 or $5.21 per diluted share in 2021. Refer to the comments above for discussion of the primary drivers of the change.

Non-GAAP Financial Measures

We supplement the reporting of our financial information determined under accounting principles generally accepted in the United States (GAAP) with certain non-GAAP financial measures,

including percentage sales growth in constant currency; percentage organic sales growth; adjusted gross profit; adjusted selling, general and administrative expenses; adjusted research, development and engineering expenses; adjusted operating income; adjusted other income (expense), net; adjusted income taxes; adjusted effective income tax rate; adjusted net earnings; and adjusted net earnings per diluted share (Diluted EPS). We believe these non-GAAP financial measures provide meaningful information to assist investors and shareholders in understanding our financial results and assessing our prospects for future performance. Management believes percentage sales growth in constant currency and the other adjusted measures described above are important indicators of our operations because they exclude items that may not be indicative of or are unrelated to our core operating results and provide a baseline for analyzing trends in our underlying businesses. Management uses these non-GAAP financial measures for reviewing the operating results of reportable business segments and analyzing potential future business trends in connection with our budget process and bases certain management incentive compensation on these non-GAAP financial measures. To measure percentage sales growth in constant currency, we remove the impact of changes in foreign currency exchange rates that affect the comparability and trend of sales. Percentage sales growth in constant currency is calculated by translating current and prior year results at the same foreign currency exchange rate. To measure percentage organic sales growth, we remove the impact of changes in foreign currency exchange rates, acquisitions and divestitures, which affect the comparability and trend of sales. Percentage organic sales growth is calculated by translating current year and prior year results at the same foreign currency exchange rates excluding the impact of acquisitions and divestitures. To measure earnings performance on a consistent and comparable basis, we exclude certain items that affect the comparability of operating results and the trend of earnings. The income tax effect of each adjustment was determined based on the tax effect of the jurisdiction in which the related pre-tax adjustment was recorded. These adjustments are irregular in timing and may not be indicative of our past and future performance. The following are examples of the types of adjustments that may be included in a period:

1.Acquisition and integration-related costs. Costs related to integrating recently acquired businesses (e.g., costs associated with the termination of sales relationships, employee retention and workforce reductions, manufacturing integration costs and other integration-related activities), changes in the fair value of contingent consideration, amortization of inventory stepped-up to fair value, specific costs (e.g., deal costs and costs associated with legal entity rationalization) related to the consummation of the acquisition process and legal entity rationalization and acquisition-related tax items.

2.Amortization of purchased intangible assets. Periodic amortization expense related to purchased intangible assets.

3.Structural optimization and other special charges. Costs associated with employee retention and workforce reductions, the closure or transfer of manufacturing and other facilities (e.g., site closure costs, contract termination costs and redundant employee costs during the work transfers), product line exits (primarily inventory, long-lived asset and specifically-identified intangible asset write-offs), certain long-lived and intangible asset write-offs and impairments and other charges.

4.Medical device regulations. Costs specific to updating our

Dollar amounts in millions except per share amounts or as otherwise specified. 16

STRYKER CORPORATION 2023 FORM 10-K

quality system, product labeling, asset write-offs and product remanufacturing to comply with the new medical device reporting regulations and other requirements of the European Union.

5.Recall-related matters. Changes in our best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within a range is not known, to resolve the Rejuvenate, LFIT V40, Wright legacy hip products and other product recalls.

6.Regulatory and legal matters. Changes in our best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within a range is not known, to resolve certain regulatory or other legal matters and the amount of favorable awards from settlements.

7.Tax matters. Impact of accounting for certain significant and discrete tax items.

Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same

or similar names. These adjusted financial measures should not be considered in isolation or as a substitute for reported sales growth, gross profit, selling, general and administrative expenses, research, development and engineering expenses, operating income, other income (expense), net, income taxes, effective income tax rate, net earnings and net earnings per diluted share, the most directly comparable GAAP financial measures. These non-GAAP financial measures are an additional way of viewing aspects of our operations when viewed with our GAAP results and the reconciliations to corresponding GAAP financial measures at the end of the discussion of Consolidated Results of Operations below. We strongly encourage investors and shareholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

The weighted-average diluted shares outstanding used in the calculation of adjusted net earnings per diluted share are the same as those used in the calculation of reported net earnings per diluted share for the respective period.

Reconciliation of the Most Directly Comparable GAAP Financial Measure to Non-GAAP Financial Measure

2023	Gross Profit		Selling, General & Administrative Expenses		Research, Development & Engineering Expenses		Operating Income		Other Income (Expense), Net		Income Taxes		Net Earnings		Effective Tax Rate		Diluted EPS
Reported	$	13,058	$	7,129	$	1,388	$	3,888	$	(215)	$	508	$	3,165	13.8	%	$	8.25
Acquisition and integration-related costs:
Inventory stepped-up to fair value	—		—		—		—		—		—		—		—		—
Other acquisition and integration-related (a)	—		(20)		—		20		—		(25)		45		(0.8)		0.12
Amortization of purchased intangible assets	—		—		—		635		—		132		503		1.2		1.31
Structural optimization and other special charges (b)	39		(166)		(1)		206		—		47		159		0.5		0.42
Goodwill impairment	—		—		—		—		—		—		—		—		—
Medical device regulations (c)	2		—		(94)		96		—		22		74		0.2		0.19
Recall-related matters (d)	—		—		—		18		—		4		14		—		0.04
Regulatory and legal matters (e)	—		(92)		—		92		—		29		63		0.4		0.16
Tax matters (f)	—		—		—		—		(8)		(51)		43		(1.2)		0.11
Adjusted	$	13,099	$	6,851	$	1,293	$	4,955	$	(223)	$	666	$	4,066	14.1	%	$	10.60

2022	Gross Profit		Selling, General & Administrative Expenses		Research, Development & Engineering Expenses		Operating Income		Other Income (Expense), Net		Income Taxes		Net Earnings		Effective Tax Rate		Diluted EPS
Reported	$	11,578	$	6,455	$	1,454	$	2,841	$	(158)	$	325	$	2,358	12.1	%	$	6.17
Acquisition and integration-related costs:
Inventory stepped-up to fair value	12		—		—		12		—		3		9		—		0.02
Other acquisition and integration-related (a)	—		(138)		—		138		—		34		104		0.5		0.27
Amortization of purchased intangible assets	—		—		—		627		—		132		495		1.7		1.30
Structural optimization and other special charges (b)	56		(206)		(87)		349		—		66		283		0.7		0.74
Goodwill impairment	—		—		—		216		—		—		216		(1.1)		0.57
Medical device regulations (c)	3		—		(137)		140		—		25		115		0.2		0.30
Recall-related matters (d)	—		—		—		(15)		—		(3)		(12)		—		(0.03)
Regulatory and legal matters (e)	—		(76)		—		76		—		7		69		(0.2)		0.18
Tax matters (f)	—		—		—		—		(75)		(9)		(66)		0.1		(0.18)
Adjusted	$	11,649	$	6,035	$	1,230	$	4,384	$	(233)	$	580	$	3,571	14.0	%	$	9.34

Dollar amounts in millions except per share amounts or as otherwise specified. 17

STRYKER CORPORATION 2023 FORM 10-K

2021	Gross Profit		Selling, General & Administrative Expenses		Research, Development & Engineering Expenses		Operating Income		Other Income (Expense), Net		Income Taxes		Net Earnings		Effective Tax Rate		Diluted EPS
Reported	$	10,968	$	6,427	$	1,235	$	2,584	$	(303)	$	287	$	1,994	12.6	%	$	5.21
Acquisition and integration-related costs:
Inventory stepped-up to fair value	266		—		—		266		—		63		203		1.0		0.53
Other acquisition and integration-related (a)	—		(319)		—		319		—		75		244		1.2		0.64
Amortization of purchased intangible assets	—		—		—		619		—		130		489		1.6		1.28
Structural optimization and other special charges (b)	28		(358)		—		386		11		52		345		(0.3)		0.90
Goodwill impairment	—		—		—		—		—		—		—		—		—
Medical device regulations (c)	5		—		(102)		107		—		17		90		—		0.24
Recall-related matters (d)	—		—		—		103		—		14		89		—		0.23
Regulatory and legal matters (e)	—		2		—		(2)		(7)		3		(12)		0.2		(0.02)
Tax matters (f)	—		—		—		—		—		(32)		32		(1.4)		0.08
Adjusted	$	11,267	$	5,752	$	1,133	$	4,382	$	(299)	$	609	$	3,474	14.9	%	$	9.09

(a) Charges represent certain acquisition and integration-related costs associated with acquisitions, including:

	2023		2022		2021
Termination of sales relationships	$	5	$	21	$	154
Employee retention and workforce reductions	6		33		90
Changes in the fair value of contingent consideration	(1)		(135)		—
Manufacturing integration costs	2		32		16
Stock compensation payments upon a change in control	—		132		—
Other integration-related activities	8		55		59
Adjustments to Operating Income	$	20	$	138	$	319
Charges for acquisition-related tax provisions	(30)		—		—
Other income taxes related to acquisition and integration-related costs	5		34		75
Adjustments to Income Taxes	$	(25)	$	34	$	75
Adjustments to Net Earnings	$	45	$	104	$	244

(b) Structural optimization and other special charges represent the costs associated with:

	2023		2022		2021
Employee retention and workforce reductions	$	69	$	74	$	39
Closure/transfer of manufacturing and other facilities	50		83		52
Product line exits	32		80		61
Certain long-lived and intangible asset write-offs and impairments	28		96		203
Other charges	27		16		31