Revenue (Notes)

12 Months Ended

Dec. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

REVENUE

Revenue Recognition

Our business units are Consumables, Infusion Systems and Vital Care. The vast majority of our sales of these products within these business units are made on a stand-alone basis to hospitals and distributors. Revenue is typically recognized upon transfer of control of the products, which we deem to be at point of shipment. For purposes of revenue recognition for our software licenses and renewals, we consider the control of these products to be transferred to a customer at a certain point in time; therefore, we recognize revenue at the start of the applicable license term.

Payment is typically due in full within 30 days of delivery or the start of the contract term. Revenue is recorded in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. We include variable consideration in net sales only to the extent that a significant reversal in revenue is not probable when the uncertainty is resolved. Our variable consideration includes distributor chargebacks, product returns and end customer rebates with distributor chargebacks representing the majority and subject to the greatest judgment, (see Note 1: Basis of Presentation and Significant Accounting Policies).

We also offer certain volume-based rebates to both our distribution and end customers, which is recorded as variable consideration when calculating the transaction price. Rebates are offered on both a fixed and tiered/variable basis. In both cases, we use information available at the time, including current contractual requirements, our historical experience with each customer and forecasted customer purchasing patterns, to estimate the most likely rebate amount. We also warrant products against defects and have a policy permitting the return of defective products. We also provide for extended service-type warranties, which we consider to be separate performance obligations. We allocate a portion of the transaction price to the extended service-type warranty based on its estimated relative selling price, and recognize revenue over the period the warranty service is provided. See Note 1. Basis of Presentation and Significant Accounting Policies for further discussion.

Arrangements with Multiple Performance Obligations

We also enter into arrangements which include multiple performance obligations, (see Note 1: Basis of Presentation and Summary of Significant Accounting Policies). The most significant judgments related to these arrangements include:

•Identifying the various performance obligations of these arrangements.

•Estimating the relative standalone selling price of each performance obligation, typically using a directly observable method or calculated on a cost plus margin basis method.

Revenue disaggregated

The following table represents our revenues disaggregated by product line (in thousands) and our disaggregated product line revenue as a percentage of total revenue:

	Year ended December 31,
	2024				2023				2022
Product line	Revenue		% of Revenue		Revenue		% of Revenue		Revenue		% of Revenue
Consumables	$	1,038,869	44	%	$	969,129	43	%	$	974,993	43	%
Infusion Systems	652,410		27	%	629,043		28	%	617,435		27	%
Vital Care	690,767		29	%	660,954		29	%	687,569		30	%
Total Revenues	$	2,382,046	100	%	$	2,259,126	100	%	$	2,279,997	100	%

We report revenue on a "where sold" basis, which reflects the revenue within the country or region in which the ultimate sale is made to our external customer.    

The following table represents our revenues disaggregated by geography (in thousands):

	Year ended December 31,
Geography	2024		2023		2022
United States	$	1,532,104	$	1,440,017	$	1,460,069
Europe, the Middle East and Africa	393,530		373,571		367,411
Asia-Pacific	232,820		241,699		257,208
Other Foreign	223,592		203,839		195,309
Total Revenues	$	2,382,046	$	2,259,126	$	2,279,997

Domestic sales accounted for 64%, 64% and 64% of total revenue in 2024, 2023 and 2022, respectively. International sales accounted for 36%, 36% and 36% of total revenue in 2024, 2023 and 2022, respectively.

Contract balances

Our contract balances (deferred revenue) are recorded in accrued liabilities and other long-term liabilities in our consolidated balance sheet (see Note 12: Accrued Liabilities and Other Long-term Liabilities). The following table presents the changes in our contract balances for the years ended December 31, 2024 and 2023, (in thousands):

	Contract Liabilities
Beginning balance, January 1, 2023	$	45,866
Equipment revenue recognized	(34,121)
Equipment revenue deferred due to implementation	35,868
Software revenue recognized	(18,526)
Software revenue deferred due to implementation	19,947
Government grant income recognized(1)	(3,684)
Government grant income deferred	944
Other deferred revenue recognized	(6,041)
Other deferred revenue	1,924
Ending balance, December 31, 2023	42,177
Equipment revenue recognized	(56,182)
Equipment revenue deferred due to implementation	55,932
Software revenue recognized	(28,292)
Software revenue deferred due to implementation	29,913
Government grant income recognized(1)	(2,072)
Government grant income deferred	—
Other deferred revenue recognized	(2,576)
Other deferred revenue	503
Ending balance, December 31, 2024	$	39,403

____________________________

(1) The government grant income deferred is amortized over the life of the related depreciable asset as a reduction to depreciation expense.

During 2024, we recognized $26.0 million in revenue that was included in the opening contract balances as of December 31, 2023.

As of December 31, 2024, revenue from remaining performance obligations is as follows (in thousands):

	Recognition Timing
	<12 Months		> 12 Months
Equipment revenue	$	17,050	$	1,231
Software revenue	11,214		471
Government grant deferred income(1)	2,064		7,343
Other deferred revenue(2)	30		—
Total	$	30,358	$	9,045

____________________________

(1)    The government grant deferred income is amortized over the life of the related depreciable asset as a reduction to depreciation expense.

(2)    Other deferred revenue includes pump development programs, purchased training and extended warranty.

Costs to Obtain a Contract with a Customer

As part of the cost to obtain a contract, we may pay incremental commissions to sales employees upon entering into a sales contract. Under ASC Topic 606, we have elected to expense these costs as incurred as the period of benefit is less than one year.

Practical expedients and exemptions

In addition to the practical expedient applied to sales commissions, under ASC Topic 606, we elected to apply the practical expedient for shipping and handling costs incurred after the customer has obtained control of a good. We will continue to treat these costs as a fulfillment cost rather than as an additional promised service.