Basis of Presentation

3 Months Ended

Dec. 26, 2020

Basis of Presentation [Abstract]

Basis of Presentation

Basis of Presentation

The consolidated financial statements of Hologic, Inc. (“Hologic” or the “Company”) presented herein have been prepared pursuant to the rules of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q and do not include all of the information and disclosures required by U.S. generally accepted accounting principles (“GAAP”) for annual financial statements. These financial statements should be read in conjunction with the consolidated financial statements and related notes for the fiscal year ended September 26, 2020 included in the Company’s Form 10-K filed with the SEC on November 17, 2020. In the opinion of management, the financial statements and notes contain all adjustments (consisting of normal recurring accruals and all other necessary adjustments) considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented.

The consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

The preparation of financial statements in conformity with GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from management’s estimates if past experience or other assumptions do not turn out to be substantially accurate. Operating results for the three and six months ended March 27, 2021 are not necessarily indicative of the results to be expected for any other interim period or the entire fiscal year ending September 25, 2021.

Recently Adopted Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments – Credit Losses (Topic 326). The purpose of ASU 2016-13 is to replace the current incurred loss impairment methodology for financial assets measured at amortized cost with a methodology that reflects expected credit losses over the lifetime of the financial asset. As a result, credit losses are recorded when financial assets are established if credit losses are expected over the asset's contractual life. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The Company adopted the standard during the first quarter of fiscal 2021. The adoption of ASU 2016-13 did not have a material effect on the Company's consolidated financial statements. See Note 5 for additional information.

In November 2019, the FASB issued ASU No. 2019-08, Compensation - Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606). This ASU identifies, evaluates, and improves areas of GAAP for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided. The amendments in this Update expanded the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The Company adopted this ASU in the first quarter of fiscal 2021, which did not have a material effect on the Company's financial statements.

Subsequent Events Consideration

The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that may require additional disclosure. Subsequent events have been evaluated as required. There were no material recognized subsequent events affecting the unaudited consolidated financial statements as of and for the three and six months ended March 27, 2021.

There was one unrecognized subsequent event related to the acquisition of Mobidiag Oy ("Mobidiag"). On April 8, 2021, the Company announced that it had entered into an agreement to acquire Mobidiag for a purchase price of approximately $795 million. The closing is subject to certain regulatory approvals and other customary closing conditions. Mobidiag, located in Finland and France, manufactures molecular diagnostic solutions for gastrointestinal infections, antimicrobial resistance management and other infections. The Company expects this acquisition to close in the fourth quarter of fiscal 2021.