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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
FORM 10-Q
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

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

For the transition period from to
Commission File Number 0-16211
DENTSPLY SIRONA Inc.
(Exact name of registrant as specified in its charter)
Delaware
39-1434669
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
13320 Ballantyne Corporate Place, Charlotte, North Carolina
28277-3607
(Address of principal executive offices)
(Zip Code)
(844) 848-0137
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, par value $.01 per shareXRAYThe Nasdaq Stock Market LLC

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 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 x 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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  x  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 the 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  x
Accelerated filer  

Non-accelerated filer  

Smaller reporting company  

Emerging growth 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 is a shell company (as defined in Rule 12b-2 of the Exchange Act).   
Yes   No   x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: At April 25, 2023, DENTSPLY SIRONA Inc. had 212,477,811 shares of common stock outstanding.



DENTSPLY SIRONA Inc.

TABLE OF CONTENTS











2


General

Unless otherwise stated herein or the context otherwise indicates, reference throughout this Form 10-Q to “Dentsply Sirona,” or the “Company,” “we,” “us” or “our” refers to financial information and transactions of DENTSPLY SIRONA Inc., together with its subsidiaries on a consolidated basis.

Forward-Looking Statements and Associated Risks

All statements in this Form 10-Q that do not directly and exclusively relate to historical facts constitute “forward-looking statements” and include statements related to our ability to successfully remediate the material weaknesses in our internal control over financial reporting disclosed in this Form 10-Q in the manner currently anticipated. These statements represent current expectations and beliefs, and no assurance can be given that the results described in such statements will be achieved. Such statements are subject to numerous assumptions, risks, uncertainties and other factors that could cause actual results to differ materially from those described in such statements, many of which are outside of our control, including those described in Part I, Item 1A, “Risk Factors” of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the "2022 Form 10-K"), and other factors which may be described in the Company’s other filings with the Securities and Exchange Commission (the “SEC”). No assurance can be given that any expectation, belief, goal or plan set forth in any forward-looking statement can or will be achieved, and readers are cautioned not to place undue reliance on such statements which speak only as of the date they are made. We do not undertake any obligation to update or release any revisions to any forward-looking statement or to report any events or circumstances after the date of this Form 10-Q or to reflect the occurrence of unanticipated events.

Investors should understand it is not possible to predict or identify all such factors or risks. As such, you should not consider the risks identified in the Company’s SEC filings to be a complete discussion of all potential risks or uncertainties associated with an investment in the Company.


3


PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts)
(unaudited)
Three Months Ended March 31,
20232022
Net sales$978 $969 
Cost of products sold459 448 
Gross profit519 521 
Selling, general, and administrative expenses416 376 
Research and development expenses
46 45 
Restructuring and other costs59 3 
Operating (loss) income(2)97 
Other income and expenses:
Interest expense, net19 12 
Other expense (income), net7 (2)
(Loss) income before income taxes(28)87 
(Benefit) provision for income taxes(5)18 
Net (loss) income(23)69 
Less: Net loss attributable to noncontrolling interest(4) 
Net (loss) income attributable to Dentsply Sirona$(19)$69 
Net (loss) income per common share attributable to Dentsply Sirona:
Basic$(0.09)$0.32 
Diluted$(0.09)$0.32 
Weighted average common shares outstanding:
Basic214.5 217.0 
Diluted214.5 217.8 

See accompanying Notes to Unaudited Interim Consolidated Financial Statements.
4


DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in millions)
(unaudited)
Three Months Ended March 31,
20232022
Net (loss) income$(23)$69 
Other comprehensive income (loss), net of tax:
 Foreign currency translation gain (loss)15 (48)
 Net (loss) gain on derivative financial instruments(1)10 
 Pension liability gain 1 
Total other comprehensive income (loss), net of tax14 (37)
Total comprehensive (loss) income(9)32 
Less: Comprehensive loss attributable to noncontrolling interests(4) 
Total comprehensive (loss) income attributable to Dentsply Sirona$(5)$32 

See accompanying Notes to Unaudited Interim Consolidated Financial Statements.
5


DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in millions, except per share amounts)
(unaudited)
March 31, 2023December 31, 2022
Assets
Current Assets:
Cash and cash equivalents$318 $365 
Accounts and notes receivables-trade, net652 632 
Inventories, net659 627 
Prepaid expenses and other current assets314 269 
Total Current Assets1,943 1,893 
Property, plant, and equipment, net770 761 
Operating lease right-of-use assets, net191 200 
Identifiable intangible assets, net1,862 1,903 
Goodwill2,701 2,688 
Other noncurrent assets206 198 
Total Assets$7,673 $7,643 
Liabilities and Equity
Current Liabilities:
Accounts payable$267 $279 
Accrued liabilities748 727 
Income taxes payable43 46 
Notes payable and current portion of long-term debt316 118 
Total Current Liabilities1,374 1,170 
Long-term debt1,842 1,826 
Operating lease liabilities144 149 
Deferred income taxes271 287 
Other noncurrent liabilities404 399 
Total Liabilities4,035 3,831 
Commitments and contingencies (Note 14)
Equity:
Preferred stock, $1.00 par value; 0.25 million shares authorized; no shares issued
  
Common stock, $0.01 par value;
3 3 
400.0 million shares authorized, and 264.5 million shares issued at March 31, 2023 and December 31, 2022
212.5 million and 215.3 million shares outstanding at March 31, 2023 and December 31, 2022
Capital in excess of par value6,604 6,629 
Retained earnings407 456 
Accumulated other comprehensive loss(614)(628)
Treasury stock, at cost, 52.0 million and 49.3 million shares at March 31, 2023 and December 31, 2022, respectively
(2,759)(2,649)
Total Dentsply Sirona Equity3,641 3,811 
Noncontrolling interests(3)1 
Total Equity3,638 3,812 
Total Liabilities and Equity$7,673 $7,643 
See accompanying Notes to Unaudited Interim Consolidated Financial Statements.
6


DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in millions, except per share amounts)
(unaudited)
Common
Stock
Capital in
Excess of
Par Value
Retained
Earnings
Accumulated
Other
Comprehensive
Loss
Treasury
Stock
Total Dentsply Sirona
Equity
Noncontrolling
Interests
Total
Equity
Balance at December 31, 2022$3 $6,629 $456 $(628)$(2,649)$3,811 $1 $3,812 
Net loss— — (19)— — (19)(4)(23)
Other comprehensive income— — — 14 — 14 — 14 
Stock based compensation expense— 17 — — — 17 — 17 
Funding of employee stock purchase plan—  — — 3 3 — 3 
Accelerated share repurchase — (30)— — (121)(151)— (151)
Restricted stock unit distributions— (12)— — 8 (4)— (4)
Cash dividends declared ($0.14 per share)
— — (30)— — (30)— (30)
Balance at March 31, 2023$3 $6,604 $407 $(614)$(2,759)$3,641 $(3)$3,638 


Common
Stock
Capital in
Excess of
Par Value
Retained
Earnings
Accumulated
Other
Comprehensive
Loss
Treasury
Stock
Total Dentsply Sirona
Equity
Noncontrolling
Interests
Total
Equity
Balance at December 31, 2021$3 $6,606 $1,514 $(592)$(2,535)$4,996 $1 $4,997 
Net income— — 69 — — 69 — 69 
Other comprehensive loss— — — (37)— (37)— (37)
Exercise of stock options— 1 — — 4 5 — 5 
Stock based compensation expense— 11 — — — 11 — 11 
Funding of employee stock purchase plan — 1 — — 1 2 — 2 
Accelerated share repurchase— (30)— — (120)(150)— (150)
Restricted stock unit distributions— (16)— — 10 (6)— (6)
Cash dividends declared ($0.125 per share)
— — (27)— — (27)— (27)
Balance at March 31, 2022$3 $6,573 $1,556 $(629)$(2,640)$4,863 $1 $4,864 

See accompanying Notes to Unaudited Interim Consolidated Financial Statements.
7



DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(unaudited)
Three Months Ended March 31,
20232022
Cash flows from operating activities:
Net (loss) income$(23)$69 
Adjustments to reconcile net (loss)/income to net cash provided by operating activities:
Depreciation31 29 
Amortization of intangible assets53 55 
Fixed asset impairment4  
Deferred income taxes(21)(14)
Stock based compensation expense17 11 
Restructuring and other costs48 (2)
Other non-cash expense9 2 
Changes in operating assets and liabilities, net of acquisitions:
Accounts and notes receivable-trade, net(15)34 
Inventories, net(30)(41)
Prepaid expenses and other current assets, net(17)(17)
Other noncurrent assets(1)3 
Accounts payable(14)19 
Accrued liabilities(31)(51)
Income taxes(37)3 
Other noncurrent liabilities6 (7)
Net cash (used in) provided by operating activities(21)93 
Cash flows from investing activities:
Capital expenditures(39)(44)
Cash received on derivative contracts2 1 
Net cash used in investing activities(37)(43)
Cash flows from financing activities:
Cash paid for treasury stock(150)(150)
Proceeds on short-term borrowings198 163 
Cash dividends paid(27)(24)
Proceeds from long-term borrowings, net of deferred financing costs 5 
Repayments on long-term borrowings (2)
Proceeds from exercised stock options 5 
Other financing activities, net(4)(7)
Net cash provided by (used in) financing activities17 (10)
Effect of exchange rate changes on cash and cash equivalents(6)(5)
Net (decrease) increase in cash and cash equivalents(47)35 
Cash and cash equivalents at beginning of period365 339 
Cash and cash equivalents at end of period$318 $374 
See accompanying Notes to Unaudited Interim Consolidated Financial Statements.
8


DENTSPLY SIRONA Inc. and Subsidiaries

NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and the rules of the U.S. Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of the results for interim periods have been included. Results for interim periods should not be considered indicative of results for a full year. These financial statements and related notes contain the accounts of DENTSPLY SIRONA Inc. and subsidiaries (“Dentsply Sirona” or the “Company”) on a consolidated basis and should be read in conjunction with the consolidated financial statements and notes included in the Company’s most recent Form 10-K for the year ended December 31, 2022.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of Net sales and expense during the reporting period. Actual results could differ materially from those estimates.

Recently Adopted Accounting Pronouncements

In October 2021, the Financial Accounting Standards Board ("FASB") issued ASU No. 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”, which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts. The new standard requirement to measure contract assets and contract liabilities acquired in a business combination at fair value differs from the current approach. The amendments in this update were effective for the fiscal years and interim periods ending after December 31, 2022. The Company adopted this accounting standard on January 1, 2023. The adoption of this standard did not materially impact the Company's consolidated financial statements or related disclosures.

Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU No. 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”, which was subsequently amended by ASU No. 2021-01 “Reference Rate Reform (Topic 848): Scope” in January 2021 and by ASU No. 2022-06 “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848” in December 2022. The new standard provides optional expedients and exceptions to contracts, hedging relationships, and other transactions that reference the London Interbank Offer Rate ("LIBOR") or another rate expected to be discontinued due to the reference rate reform. This standard was effective upon issuance. The adoption of this standard did not materially impact the Company's consolidated financial statements or related disclosures.

Seasonality

Our business is subject to quarterly fluctuations in demand due to price changes, marketing and promotional programs, management of inventory levels by distributors and other customers, and implementation of strategic initiatives which may impact sales levels in any given period. Demand can also fluctuate based on the timing of dental tradeshows where promotions are offered, new product introductions, and variability in dental patient traffic, which can be exacerbated by seasonal or severe weather patterns, other demographic disruptions such as the recent COVID-19 pandemic, or macroeconomic conditions. Some dental practices in certain countries may also delay purchasing equipment and restocking consumables until year-end due to tax or other financial or budget planning which can impact the timing of our consolidated net sales, net income and cash flows. Sales for the industry and the Company are generally strongest in the second and fourth quarters and weaker in the first and third quarters, due to the effects of the items noted above and due to the impact of holidays and vacations, particularly throughout Europe. Because of the seasonal nature of our business, the results of operations for any fiscal quarter will not necessarily be indicative of results to be expected for other quarters or a full fiscal year.
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NOTE 2 - REVENUE

Revenues are derived primarily from the sale of dental equipment and dental and healthcare consumable products. Revenues are measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services.

Net sales disaggregated by product category for the three months ended March 31, 2023 and 2022 were as follows:
Three Months Ended
(in millions)20232022
Equipment & Instruments$152 $166 
CAD/CAM105 106 
Orthodontics86 68 
Implants137 155 
Healthcare68 70 
Technology & Equipment segment revenue$548 $565 
Endodontic & Restorative$313 $293 
Other Consumables117 111 
Consumables segment revenue$430 $404 
Total net sales$978 $969 

Net sales disaggregated by geographic region for the three months ended March 31, 2023 and 2022 were as follows:
Three Months Ended
(in millions)20232022
United States$351 $308 
Europe396 411 
Rest of World231 250 
Total net sales$978 $969 

Contract Assets and Liabilities

The Company does not typically have contract assets in the normal course of its business. Contract liabilities, which represent billings in excess of revenue recognized, are primarily related to advanced billings for customer aligner treatment where the performance obligation has not yet been fulfilled. The Company had $93 million and $84 million of deferred revenue recorded in Accrued liabilities in the Consolidated Balance Sheets at March 31, 2023 and December 31, 2022, respectively. The Company recognized approximately $32 million of revenue during the current year which was previously deferred as of December 31, 2022. The Company expects to recognize a significant majority of the remaining deferred revenue within the next twelve months.

Allowance for Doubtful Accounts

Accounts and notes receivables-trade, net are stated net of allowances for doubtful accounts and trade discounts, which were $11 million at March 31, 2023 and $14 million at December 31, 2022. For the three months ended March 31, 2023 and 2022, changes to the provision for doubtful accounts including write-offs of accounts receivable that were previously reserved were insignificant. Changes to this provision are included in Selling, general, and administrative expenses in the Consolidated Statements of Operations.


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NOTE 3 – STOCK COMPENSATION

The amounts of stock compensation expense recorded in the Company's Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022 were as follows:
Three Months Ended
(in millions)20232022
Cost of products sold
$1 $1 
Selling, general, and administrative expense13 9 
Research and development expense1 1 
Restructuring and other costs2  
Total stock based compensation expense$17 $11 
Related deferred income tax benefit$2 $1 

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NOTE 4 – COMPREHENSIVE INCOME (LOSS)

Changes in Accumulated other comprehensive income (loss) ("AOCI"), net of tax, by component for the three months ended March 31, 2023 and 2022 were as follows:
(in millions)Foreign Currency Translation Gain (Loss)Gain (Loss) on Cash Flow HedgesGain (Loss) on Net Investment and Fair Value HedgesPension
Liability Gain (Loss)
Total
Balance, net of tax, at December 31, 2022$(522)$(17)$(73)$(16)$(628)
Other comprehensive income (loss) before reclassifications and tax impact6 (1)  5 
Tax benefit9    9 
Other comprehensive income (loss), net of tax, before reclassifications15 (1)  14 
Amounts reclassified from accumulated other comprehensive income, net of tax     
Net increase (decrease) in other comprehensive income15 (1)  14 
Balance, net of tax, at March 31, 2023$(507)$(18)$(73)$(16)$(614)
(in millions)Foreign Currency Translation Gain (Loss)Gain (Loss) on Cash Flow HedgesGain (Loss) on Net Investment and Fair Value HedgesPension
Liability Gain (Loss)
Total
Balance, net of tax, at December 31, 2021$(366)$(16)$(103)$(107)$(592)
Other comprehensive (loss) income before reclassifications and tax impact(37)3 9  (25)
Tax expense(11) (1) (12)
Other comprehensive (loss) income, net of tax, before reclassifications(48)3 8  (37)
Amounts reclassified from accumulated other comprehensive income, net of tax (1) 1  
Net (decrease) increase in other comprehensive income(48)2 8 1 (37)
Balance, net of tax, at March 31, 2022$(414)$(14)$(95)$(106)$(629)
At March 31, 2023 and December 31, 2022, the cumulative tax adjustments were $109 million and $100 million, respectively, primarily related to foreign currency translation adjustments.

The cumulative foreign currency translation adjustments included translation losses of $417 million and $438 million at March 31, 2023 and December 31, 2022, respectively, and cumulative losses on loans designated as hedges of net investments of $90 million and $84 million, respectively. These foreign currency translation losses were partially offset by movements on derivative financial instruments.

Reclassifications out of AOCI to the Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022 were not significant.

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NOTE 5 – EARNINGS PER COMMON SHARE

The computation of basic and diluted (loss) earnings per common share for the three months ended March 31, 2023 and 2022 were as follows:
Basic (Loss) Earnings Per Common Share Three Months Ended
(in millions, except per share amounts)20232022
Net (loss) income attributable to Dentsply Sirona$(19)$69 
Weighted average common shares outstanding214.5 217.0 
(Loss) earnings per common share - basic$(0.09)$0.32 
Diluted (Loss) Earnings Per Common ShareThree Months Ended
(in millions, except per share amounts)20232022
Net (loss) income attributable to Dentsply Sirona$(19)$69 
Weighted average common shares outstanding214.5 217.0 
Incremental weighted average shares from assumed exercise of dilutive options from stock-based compensation awards 0.8 
Total weighted average diluted shares outstanding214.5 217.8 
(Loss) earnings per common share - diluted$(0.09)$0.32 

The calculation of weighted average diluted common shares outstanding excluded 1.4 million of potentially dilutive common shares because the Company reported a net loss for the three months ended March 31, 2023.

For the three months ended March 31, 2023, the Company excluded from the computation of weighted average diluted shares outstanding 3.8 million of equivalent shares of common stock from stock options and RSUs because their effect would be antidilutive. For the three months ended March 31, 2022, the Company excluded 1.9 million of equivalent shares of common stock outstanding from stock options and RSUs because their effect would be antidilutive.

The Board of Directors has approved a share repurchase program, of up to $1.0 billion. Share repurchases may be made through open market purchases, Rule 10b5-1 plans, accelerated share repurchases, privately negotiated transactions or other transactions in such amounts and at such times as the Company deems appropriate based upon prevailing market and business conditions and other factors. At March 31, 2023, the Company had authorization to repurchase $620 million in shares of common stock remaining under the share repurchase program.

On March 3, 2023, the Company entered into an Accelerated Share Repurchase Agreement ("ASR Agreement") with a financial institution to repurchase the Company's common stock. The Company repurchased shares under the ASR Agreement as part of the share repurchase program described above. The final number of shares will be based on the volume-weighted average price of the Company's common stock during the valuation period of the ASR Agreement, less a discount and subject to adjustments.

(in millions, except per share amounts)Initial DeliveryFinal Settlement
Agreement DateAmount PaidShares ReceivedPrice per shareValue of Shares as a % of Contract ValueSettlement DateTotal Shares ReceivedAverage Price per Share
March 3, 2023$150 3.1$38.74 80 %April 28, 20233.9$38.55 

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The ASR Agreement was accounted for as an initial delivery of common shares in a treasury stock transaction on March 6, 2023 of $121 million and a forward contract indexed to the Company's common stock for an amount of common shares to be determined on the final settlement date. This initial treasury stock transaction included an excise tax accrual of $1 million for public company stock repurchases established by the Inflation Reduction Act (IRA) of 2022. The forward contract met all applicable criteria for equity classification and was not accounted for as a derivative instrument. Therefore, the forward contract was recorded as Capital in excess of par value in the Consolidated Balance Sheets at March 31, 2023. The initial delivery of common stock reduced the weighted average common shares outstanding for both basic and diluted EPS. The forward contract did not impact the weighted average common shares outstanding for diluted EPS.


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NOTE 6 – SEGMENT INFORMATION
The Company’s two operating segments are organized primarily by product and generally have overlapping geographical presence, customer bases, distribution channels, and regulatory oversight. These operating segments are also the Company’s reportable segments in accordance with how the Company’s chief operating decision-maker regularly reviews financial results and uses this information to evaluate the Company’s performance and allocate resources.

The Company evaluates performance of the segments based on net sales and adjusted operating income. Segment adjusted operating income is defined as operating income before income taxes and before certain corporate headquarters unallocated costs (including certain inter-segment eliminations which are generally based on estimated external selling prices and are eliminated during consolidation), goodwill and intangible asset impairments, restructuring and other costs, interest expense, net, other expense (income), net, amortization of intangible assets and depreciation resulting from the fair value step-up of property, plant, and equipment from acquisitions.

A description of the products and services provided within each of the Company’s two reportable segments is provided below.

Technologies & Equipment

This segment is responsible for the design, manufacture, and sales of the Company’s dental technology and equipment products and healthcare products. These products include dental implants, CAD/CAM systems, orthodontic aligners, imaging systems, treatment centers, instruments, as well as medical devices.

Consumables

This segment is responsible for the design, manufacture, and sales of the Company’s consumable products which include various preventive, restorative, endodontic, and dental laboratory products.

The Company’s segment information for the three months ended March 31, 2023 and 2022 was as follows:
Net Sales
Three Months Ended
(in millions)20232022
Technologies & Equipment$548 $565 
Consumables430 404 
Total net sales$978 $969 
Segment Adjusted Operating Income
Three Months Ended
(in millions)20232022
Technologies & Equipment$67 $86 
Consumables131 135 
Segment adjusted operating income198 221 
Reconciling items expense (income):
All other (a)
87 65 
Restructuring and other costs59 3 
Interest expense, net19 12 
Other expense (income), net7 (2)
Amortization of intangible assets53 55 
Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations1 1 
(Loss) income before income taxes$(28)$87 
(a) Includes the results of unassigned Corporate headquarters costs and inter-segment eliminations.
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NOTE 7 – INVENTORIES

Inventories, net were as follows:
(in millions)March 31, 2023December 31, 2022
Raw materials and supplies$168 $169 
Work-in-process87 77 
Finished goods404 381 
Inventories, net$659 $627 

The Company's inventory reserve was $90 million and $83 million at March 31, 2023 and December 31, 2022, respectively. Inventories are stated at the lower of cost and net realizable value.

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NOTE 8 – RESTRUCTURING AND OTHER COSTS

Restructuring and other costs for the three months ended March 31, 2023 and 2022 were recorded in the Consolidated Statements of Operations as follows:
Affected Line ItemThree Months Ended
(in millions)20232022
Cost of products sold$4 $ 
Restructuring and other costs59 3 
Total restructuring and other costs$63 $3 

The restructuring and other costs of $59 million recorded in the first quarter of 2023 consist primarily of employee severance benefits and other restructuring costs related to the plan approved by the Board of Directors of the Company on February 14, 2023. This plan seeks to restructure the Company’s business to improve operational performance and drive shareholder value creation through a new operating model with five global business units, optimization of central functions and overall management infrastructure, and other efforts aimed at cost savings. The restructuring plan anticipates a reduction in the Company’s global workforce of approximately 8% to 10%, subject to co-determination processes with employee representative groups in countries where required. The Company expects to incur between $115 and $135 million in one-time charges, comprising $80 to $100 million in restructuring expenditures and charges, primarily related to employee transition, severance payments, employee benefits and facility closure costs, and $35 million in other non-recurring costs which mostly consist of legal, consulting and other professional service fees. The majority of these costs will be incurred as cash expenditures in 2023. The estimates of these charges and their timing are subject to several assumptions, including local law requirements in various jurisdictions and co-determination aspects in countries where required. Actual amounts may differ materially from estimates. In addition, the Company may incur other charges or cash expenditures in connection with this plan which are not currently contemplated.

The liabilities associated with the Company's restructuring plans are recorded in Accrued liabilities and Other noncurrent liabilities in the Consolidated Balance Sheets. Activity in the Company’s restructuring accruals at March 31, 2023 was as follows:
Severance
(in millions)2022 and Prior Plans2023 PlanTotal
Balance at December 31, 2022$7 $ $7 
Provisions2 53 55 
Amounts applied(2)(5)(7)
Balance at March 31, 2023$7 $48 $55 
Other Restructuring Costs
(in millions)2022 and Prior Plans2023 PlanTot