What changed in this filing

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Item 1. Financial Statements

2024-05-02 compared with 2023-11-01 · 110 added, 215 removed, 413 unchanged (44% of the section changed)

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended

September 30, Nine Months Ended

September 30,

Three Months Ended March 31,

(in millions, except per share data) 2024 2023

7 unchanged sentences

Interest expense 166 141

Other (income) expense, net ( 35 ) 8 ( 77 ) 51

Income before income taxes and equity in earnings (losses) of unconsolidated affiliates 349 360 1,086 1,088

Other expense (income), net 11 ( 26 )

Income before income taxes and equity in losses of unconsolidated affiliates 340 362

Income tax expense 49 71

Income before equity in earnings (losses) of unconsolidated affiliates 298 290 883 876

Equity in earnings (losses) of unconsolidated affiliates 5 ( 7 ) 6 ( 12 )

Income before equity in losses of unconsolidated affiliates 291 291

Equity in losses of unconsolidated affiliates ( 3 ) ( 2 )

Net income $ 288 $ 289

9 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended

September 30, Nine Months Ended

September 30,

Three Months Ended March 31,

(in millions) 2024 2023

3 unchanged sentences

Defined benefit plan adjustments, net of income tax expense of $ — , $ —

Foreign currency translation, net of income tax expense of $ 44 , $ 84 , $ 12 , $ 195

( 136 ) ( 218 ) ( 170 ) ( 539 )

Foreign currency translation, net of income tax expense (benefit) of $ 37 , $( 29 )

Reclassification adjustments:

Reclassifications on derivative instruments included in net income, net of income tax (expense) benefit of $( 3 ), $ — , $( 14 ), $ 4

( 9 ) 1 ( 41 ) 14

Reclassifications on derivative instruments included in net income, net of income tax (expense) of $( 3 ), $( 8 )

Comprehensive income $ 244 $ 285

3 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except per share data) September 30, 2023 December 31, 2022

(in millions, except per share data) March 31, 2024 December 31, 2023

Current assets:

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Stockholders’ equity:

Common stock and additional paid-in capital, 400.0 shares authorized as of September 30, 2023 and December 31, 2022, $ 0.01 par value, 257.1 shares issued and 182.5 shares outstanding as of September 30, 2023;

Common stock and additional paid-in capital, 400.0 shares authorized as of March 31, 2024 and December 31, 2023, $ 0.01 par value, 257.9 shares issued and 182.2 shares outstanding as of March 31, 2024;

257.2 shares issued and 181.5 shares outstanding as of December 31, 2023

1 unchanged sentence

Retained earnings 4,980 4,692

Treasury stock, at cost, 74.6 and 70.7 shares as of September 30, 2023 and December 31, 2022, respectively

Treasury stock, at cost, 75.7 and 75.7 shares as of March 31, 2024 and December 31, 2023, respectively

( 8,741 ) ( 8,741 )

6 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2024 2023

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Stock-based compensation 56 75

(Earnings) losses from unconsolidated affiliates ( 6 ) 12

(Gain) loss on investments, net ( 5 ) 35

Losses from unconsolidated affiliates 3 2

Gain on investments, net ( 12 ) ( 4 )

Benefit from deferred income taxes ( 66 ) ( 27 )

11 unchanged sentences

Financing activities:

Proceeds from issuance of debt 1,250 1,250

Payment of debt issuance costs ( 19 ) ( 5 )

Repayment of debt and principal payments on finance leases ( 43 ) ( 39 )

1 unchanged sentence

Repayment of revolving credit facility ( 275 ) ( 100 )

Payments related to employee stock option plans ( 58 ) ( 70 )

Payments related to employee stock incentive plans ( 60 ) ( 58 )

Repurchase of common stock — ( 129 )

Contingent consideration and deferred purchase price payments ( 3 ) ( 62 )

Net cash provided by (used in) financing activities 38 ( 136 )

Net cash (used in) provided by financing activities ( 106 ) 87

Effect of foreign currency exchange rate changes on cash ( 34 ) ( 4 )

Increase (decrease) in cash and cash equivalents 8 ( 92 )

Increase in cash and cash equivalents 68 278

Cash and cash equivalents at beginning of period 1,376 1,216

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in millions) Common

Shares Treasury

Shares Common

Stock Additional

Capital Retained

Earnings Treasury

Stock Accumulated

Comprehensive

(Loss) Income Total

(in millions) Common Stock Shares Treasury Stock Shares Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive (Loss) Income Total

Balance, December 31, 2023 257.2 ( 75.7 ) $ 3 $ 11,025 $ 4,692 $ ( 8,741 ) $ ( 867 ) $ 6,112

Issuance of common stock 0.7 — — ( 61 ) — — — ( 61 )

Repurchase of common stock — ( 0.7 ) — — — ( 129 ) — ( 129 )

Stock-based compensation — — — 49 — — — 49

1 unchanged sentence

Unrealized gains on derivative instruments, net of tax — — — — — — 34 34

Defined benefit plan adjustments, net of tax — — — — — — 1 1

Foreign currency translation, net of tax — — — — — — ( 69 ) ( 69 )

1 unchanged sentence

Balance, March 31, 2024 257.9 ( 75.7 ) $ 3 $ 11,013 $ 4,980 $ ( 8,741 ) $ ( 911 ) $ 6,344

Issuance of common stock 0.1 — — — — — — —

Repurchase of common stock, net of tax — ( 2.5 ) — — — ( 495 ) — ( 495 )

Stock-based compensation — — — 43 — — — 43

Net income — — — — 297 — — 297

Unrealized gains on derivative instruments, net of tax — — — — — — 22 22

Foreign currency translation, net of tax — — — — — — ( 44 ) ( 44 )

Reclassification adjustments, net of tax — — — — — — ( 7 ) ( 7 )

Balance, June 30, 2023 257.0 ( 73.9 ) 3 10,949 3,920 ( 8,364 ) ( 760 ) 5,748

Issuance of common stock 0.1 — — — — — — —

Repurchase of common stock, net of tax — ( 0.7 ) — — — ( 145 ) — ( 145 )

Stock-based compensation — — — 42 — — — 42

Net income — — — — 303 — — 303

Unrealized gains on derivative instruments, net of tax — — — — — — 2 2

Foreign currency translation, net of tax — — — — — — ( 136 ) ( 136 )

Reclassification adjustments, net of tax — — — — — — ( 9 ) ( 9 )

Balance, September 30, 2023 257.1 ( 74.6 ) $ 3 $ 10,991 $ 4,223 $ ( 8,509 ) $ ( 903 ) $ 5,805

The accompanying notes are an integral part of these condensed consolidated financial statements.

IQVIA HOLDINGS INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in millions) Common

Shares Treasury

Shares Common

Stock Additional

Capital Retained

Earnings Treasury

Stock Accumulated

Comprehensive

(Loss) Income Total

(in millions) Common Stock Shares Treasury Stock Shares Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive (Loss) Income Total

Balance, December 31, 2022 256.4 ( 70.7 ) $ 3 $ 10,895 $ 3,334 $ ( 7,740 ) $ ( 727 ) $ 5,765

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Balance, March 31, 2023 256.9 ( 71.4 ) $ 3 $ 10,906 $ 3,623 $ ( 7,869 ) $ ( 731 ) $ 5,932

Issuance of common stock 0.1 — — ( 2 ) — — — ( 2 )

Repurchase of common stock — ( 2.8 ) — — — ( 590 ) — ( 590 )

Stock-based compensation — — — 47 — — — 47

Net income — — — — 256 — — 256

Unrealized losses on derivative instruments, net of tax — — — — — — ( 7 ) ( 7 )

Defined benefit plan adjustments, net of tax — — — — — — ( 4 ) ( 4 )

Foreign currency translation, net of tax — — — — — — ( 281 ) ( 281 )

Reclassification adjustments, net of tax — — — — — — 14 14

Balance, June 30, 2022 256.3 ( 69.7 ) 3 10,787 2,824 ( 7,565 ) ( 697 ) 5,352

Issuance of common stock — — — ( 1 ) — — — ( 1 )

Repurchase of common stock — ( 0.8 ) — — — ( 150 ) — ( 150 )

Stock-based compensation — — — 64 — — — 64

Net income — — — — 283 — — 283

Unrealized gains on derivative instruments, net of tax — — — — — — 6 6

Defined benefit plan adjustments, net of tax — — — — — — 10 10

Foreign currency translation, net of tax — — — — — — ( 218 ) ( 218 )

Reclassification adjustments, net of tax — — — — — — 1 1

Balance, September 30, 2022 256.3 ( 70.5 ) $ 3 $ 10,850 $ 3,107 $ ( 7,715 ) $ ( 898 ) $ 5,347

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Recently Issued Accounting Standards

Accounting pronouncements adopted

In September 2022, the Financial Accounting Standards Board ("FASB") issued new accounting guidance, Accounting Standards Update ("ASU") 2022-04, Liabilities - Supplier Finance Programs , to enhance the transparency of supplier finance programs.

The amendments in this ASU address investor and other financial statement user requests for additional information about the use of supplier finance programs by the buyer party to understand the effect of those programs on an entity's working capital, liquidity, and cash flows.

The Company adopted this new accounting guidance effective January 1, 2023.

The adoption of this new accounting guidance did not have a material effect on the Company's disclosures within the condensed consolidated financial statements.

Accounting pronouncements issued but not adopted as of March 31, 2024

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , to improve reportable segment disclosure requirements.

The new guidance requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included in the reported measure of segment profit or loss.

It does not change the definition of a segment or the guidance for determining reportable segments.

The new guidance is effective for the Company in the annual period beginning January 1, 2024 and in 2025 for interim periods.

Adoption of this ASU will result in additional disclosure, but it will not impact the Company’s consolidated financial position, results of operations or cash flows.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , to enhance the transparency and decision usefulness of income tax disclosures.

The amendments in this ASU require additional disclosures about income taxes, primarily focused on the disclosure of income taxes paid and the rate reconciliation table.

The new guidance will be effective for the Company in the annual period beginning January 1, 2025.

The Company is assessing the impacts of this ASU on its disclosures within the consolidated financial statements.

Revenues by Geography, Concentration of Credit Risk and Remaining Performance Obligations

The following tables represent revenues by geographic region and reportable segment for the three and nine months ended September 30, 2023 and 2022:

Three Months Ended September 30, 2023

(in millions) Technology &

Analytics Solutions Research &

Development Solutions Contract Sales &

Medical Solutions Total

Americas $ 761 $ 1,017 $ 78 $ 1,856

Europe and Africa 519 520 50 1,089

Asia-Pacific 151 585 55 791

Total revenues $ 1,431 $ 2,122 $ 183 $ 3,736

Three Months Ended September 30, 2022

(in millions) Technology &

Analytics Solutions Research &

Development Solutions Contract Sales &

Medical Solutions Total

Americas $ 746 $ 960 $ 91 $ 1,797

Europe and Africa 503 488 40 1,031

Asia-Pacific 151 531 52 734

Total revenues $ 1,400 $ 1,979 $ 183 $ 3,562

Nine Months Ended September 30, 2023

(in millions) Technology &

Analytics Solutions Research &

Development Solutions Contract Sales &

Medical Solutions Total

The following tables represent revenues by geographic region and reportable segment for the three months ended March 31, 2024 and 2023:

Three Months Ended March 31, 2024

(in millions) Technology & Analytics Solutions Research & Development Solutions Contract Sales & Medical Solutions Total

Americas $ 743 $ 986 $ 73 $ 1,802

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Total revenues $ 1,453 $ 2,095 $ 189 $ 3,737

Nine Months Ended September 30, 2022

(in millions) Technology &

Analytics Solutions Research &

Development Solutions Contract Sales &

Medical Solutions Total

Three Months Ended March 31, 2023

(in millions) Technology & Analytics Solutions Research & Development Solutions Contract Sales & Medical Solutions Total

Americas $ 735 $ 986 $ 80 $ 1,801

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Total revenues $ 1,444 $ 2,026 $ 182 $ 3,652

No individual customer represented 10% or more of consolidated revenues for the three and nine months ended September 30, 2023 or 2022.

No individual customer represented 10% or more of consolidated revenues for the three months ended March 31, 2024 or 2023.

Transaction Price Allocated to the Remaining Performance Obligations

As of September 30, 2023, approximately $ 31.3 billion of revenues are expected to be recognized in the future from remaining performance obligations.

As of March 31, 2024, approximately $ 33.0 billion of revenues are expected to be recognized in the future from remaining performance obligations.

The Company expects to recognize revenues on approximately 30 % of these remaining performance obligations over the next twelve months , on approximately 85 % over the next five years, with the balance recognized thereafter.

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Trade accounts receivables and unbilled services consist of the following:

(in millions) September 30, 2023 December 31, 2022

(in millions) March 31, 2024 December 31, 2023

Trade accounts receivable $ 1,437 $ 1,473

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Unbilled services and unearned income were as follows:

(in millions) September 30, 2023 December 31, 2022 Change

(in millions) March 31, 2024 December 31, 2023 Change

Unbilled services $ 2,019 $ 1,942 $ 77

1 unchanged sentence

Net balance $ 105 $ 143 $ ( 38 )

Unbilled services, which is comprised of approximately 66 % and 61 % of unbilled receivables and 34 % and 39 % of contract assets as of September 30, 2023 and December 31, 2022, respectively, increased by $ 281 million as compared to December 31, 2022.

Unbilled services, which is comprised of approximately 67 % and 66 % of unbilled receivables and 33 % and 34 % of contract assets as of March 31, 2024 and December 31, 2023, respectively, increased by $ 77 million as compared to December 31, 2023.

Contract assets are unbilled services for which invoicing is based on the timing of certain milestones related to service contracts for clinical research whereas unbilled receivables are billable upon the passage of time.

Unearned income increased by $ 41 million over the same period resulting in an increase of $ 240 million in the net balance of unbilled services and unearned income between September 30, 2023 and December 31, 2022.

Unearned income increased by $ 115 million over the same period resulting in a decrease of $ 38 million in the net balance of unbilled services and unearned income between March 31, 2024 and December 31, 2023.

The change in the net balance is driven by the difference in timing of revenue recognition in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers , primarily related to the Company’s Research & Development Solutions contracts (which is based on the percentage of costs incurred) versus the timing of invoicing, which is based on certain milestones.

The majority of the unearned income balance as of the beginning of the year is expected to be recognized in revenues during the year ended December 31, 2024.

Bad debt expense recognized on the Company’s trade accounts receivable was immaterial for the three and nine months ended September 30, 2023 and 2022.

Bad debt expense recognized on the Company’s trade accounts receivable was immaterial for the three months ended March 31, 2024 and 2023.

Accounts Receivable Factoring Arrangements

The Company has accounts receivable factoring agreements to sell certain eligible unsecured trade accounts receivable, either based on automatic arrangements or at its option, without recourse, to unrelated third-party financial institutions for cash.

During the nine months ended September 30, 2023, through its accounts receivable factoring arrangements that the Company utilizes most frequently, the Company factored approximately $ 545 million of customer invoices on a non-recourse basis and received approximately $ 534 million in cash proceeds from the sales.

During the three months ended March 31, 2024, through its accounts receivable factoring arrangements that the Company utilizes most frequently, the Company factored approximately $ 211 million of customer invoices on a non-recourse basis and received approximately $ 206 million in cash proceeds from the sales.

The fees associated with these transactions were immaterial.

The Company has other accounts receivable arrangements for which the activity associated with them is immaterial.

The following is a summary of goodwill by reportable segment for the nine months ended September 30, 2023:

The following is a summary of goodwill by reportable segment for the three months ended March 31, 2024:

(in millions) Technology & Analytics Solutions Research & Development Solutions Contract Sales & Medical Solutions Consolidated

2 unchanged sentences

Impact of foreign currency fluctuations and other ( 144 ) ( 6 ) ( 4 ) ( 154 )

Balance as of September 30, 2023 $ 11,712 $ 2,428 $ 148 $ 14,288

Balance as of March 31, 2024 $ 11,935 $ 2,433 $ 148 $ 14,516

The fair values of the Company’s derivative instruments and the line items on the accompanying condensed consolidated balance sheets to which they were recorded are summarized in the following table:

(in millions) Balance Sheet Classification September 30, 2023 December 31, 2022

(in millions) Balance Sheet Classification March 31, 2024 December 31, 2023

Assets Liabilities Notional Assets Liabilities Notional

1 unchanged sentence

Interest rate swaps Other current assets, other assets and other current liabilities $ 15 $ 17 $ 3,296 $ 13 $ 51 $ 3,300

Cross-currency swaps Other current liabilities — 52 2,746 — 108 2,750

Foreign exchange forward contracts Other current assets and other current liabilities 1 1 119 2 — 121

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The pre-tax effect of the Company’s cash flow hedging instruments on other comprehensive income is summarized in the following table:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2024 2023

2 unchanged sentences

Total $ 34 $ ( 20 )

The Company expects approximately $ 30 million of pre-tax unrealized gains related to its foreign exchange contracts and interest rate derivatives included in accumulated other comprehensive (loss) income (“AOCI”) as of September 30, 2023 to be reclassified into earnings within the next twelve months.

As of September 30, 2023, the Company's foreign currency denominated debt balance (net of original issue discount) designated as a hedge of its net investment in certain foreign subsidiaries totaled € 5,199 million ($ 5,498 million).

The amount of foreign exchange gains related to the net investment hedge included in the cumulative translation adjustment component of AOCI for the nine months ended September 30, 2023 and 2022 was $ 69 million and $ 807 million, respectively.

The Company expects approximately $ 38 million of pre-tax unrealized gains related to its foreign exchange contracts and interest rate derivatives included in accumulated other comprehensive (loss) income (“AOCI”) as of March 31, 2024 to be reclassified into earnings within the next twelve months.

The total amount, net of income taxes, of the cash flow hedge effect on the accompanying condensed consolidated financial statements of income was $ 9 million and $ 25 million for the three months ended March 31, 2024 and 2023, respectively.

As of March 31, 2024, the Company's cross-currency swaps were designated as a hedge of its net investment in certain foreign subsidiaries.

For the three months ended March 31, 2024, the Company recorded a gain of $ 56 million within AOCI as a result of these cross-currency swaps.

The Company recognized approximately $ 9 million related to the excluded component as a reduction of interest expense for the three months ended March 31, 2024.

As of March 31, 2024, the portion of the Company's foreign currency denominated debt balance (net of original issue discount) designated as a hedge of its net investment in certain foreign subsidiaries totaled € 2,789 million ($ 3,011 million).

The amount of foreign exchange gains (losses) related to the net investment hedge included in the cumulative translation adjustment component of AOCI for the three months ended March 31, 2024 and 2023 was $ 68 million and $( 89 ) million, respectively.

Fair Value Measurements

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This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The carrying values of cash, cash equivalents, accounts receivable and accounts payable approximated their fair values as of September 30, 2023 and December 31, 2022 due to their short-term nature.

As of September 30, 2023 and December 31, 2022, the fair value of total debt was $ 13,138 million and $ 12,281 million, respectively, as determined under Level 2 measurements for these financial instruments.

The carrying values of cash, cash equivalents, accounts receivable and accounts payable approximated their fair values as of March 31, 2024 and December 31, 2023 due to their short-term nature.

As of March 31, 2024 and December 31, 2023, the fair value of total debt was $ 13,397 million and $ 13,597 million, respectively, as determined under Level 2 measurements for these financial instruments.

Recurring Fair Value Measurements

The following table summarizes the fair value of the Company’s financial assets and liabilities that are measured and reported at fair value on a recurring basis as of September 30, 2023:

The following table summarizes the fair value of the Company’s financial assets and liabilities that are measured and reported at fair value on a recurring basis as of March 31, 2024:

(in millions) Level 1 Level 2 Level 3 Total

15 unchanged sentences

Marketable securities — The Company values trading and available-for-sale securities using the quoted market value of the securities held.

Derivatives — Derivatives consist of foreign exchange contracts and interest rate swaps.

Derivatives — Derivatives consist of foreign exchange contracts, interest rate swaps, and cross-currency swaps.

The fair value of foreign exchange contracts is based on observable market inputs of spot and forward rates or using other observable inputs.

The fair value of the interest rate swaps is the estimated amount that the Company would receive or pay to terminate such agreements, taking into account market interest rates and the remaining time to maturities or using market inputs with mid-market pricing as a practical expedient for bid-ask spread.

The fair value of the cross-currency swaps is the estimated amount that the Company would receive or pay to terminate such agreements, taking into account the effective interest rates, foreign exchange rates and the remaining time to maturities.

Contingent consideration — The Company values contingent consideration related to business combinations using a weighted probability calculation of potential payment scenarios discounted at rates reflective of the risks associated with the expected future cash flows.

Assumptions used to estimate the fair value of contingent consideration include various financial metrics (revenue performance targets and operating forecasts) and the probability of achieving the specific targets.

Based on the assessments of the probability of achieving specific targets, as of September 30, 2023, the Company has accrued approximately 35 % of the maximum contingent consideration payments that could potentially become payable.

The following table summarizes the changes in Level 3 financial assets and liabilities measured on a recurring basis for the nine months ended September 30, 2023:

Assumptions used to estimate the fair value of contingent consideration include various financial metrics (revenues performance targets and operating forecasts) and the probability of achieving the specific targets.

Based on the assessments of the probability of achieving specific targets, as of March 31, 2024, the Company has accrued approximately 42 % of the maximum contingent consideration payments that could potentially become payable.

The following table summarizes the changes in Level 3 financial assets and liabilities measured on a recurring basis for the three months ended March 31, 2024:

(in millions) Contingent Consideration

3 unchanged sentences

Revaluations included in earnings and foreign currency translation adjustments ( 1 )

Balance as of September 30, 2023 $ 104

Balance as of March 31, 2024 $ 119

The current portion of contingent consideration is included within accrued expenses and the long-term portion is included within other liabilities on the accompanying condensed consolidated balance sheets.

Revaluations of contingent consideration are recognized in other (income) expense, net on the accompanying condensed consolidated statements of income.

Revaluations of contingent consideration are recognized in other expense (income), net on the accompanying condensed consolidated statements of income.

A change in significant unobservable inputs could result in a higher or lower fair value measurement of contingent consideration.

Non-recurring Fair Value Measurements

As of September 30, 2023, assets carried on the balance sheet and not remeasured to fair value on a recurring basis totaled $ 19,387 million and were identified as Level 3.

As of March 31, 2024, assets carried on the balance sheet and not remeasured to fair value on a recurring basis totaled $ 19,477 million and were identified as Level 3.

These assets are comprised of debt investments and cost and equity method investments of $ 236 million, goodwill of $ 14,516 million and other identifiable intangibles, net of $ 4,725 million.

Credit Arrangements

The following is a summary of the Company’s revolving credit facilities as of September 30, 2023:

The following is a summary of the Company’s revolving credit facilities as of March 31, 2024:

Interest Rates

$ 2,000 million (revolving credit facility)

Dollar Term SOFR plus a margin of 1.25 % plus a 10 basis credit spread adjustment as of September 30, 2023

Dollar Term SOFR plus a margin of 1.25 % plus a 10 basis credit spread adjustment as of March 31, 2024

$ 110 million (receivables financing facility)

Dollar Term SOFR plus a margin of 0.90 % plus a 11 basis credit spread adjustment as of September 30, 2023

Dollar Term SOFR plus a margin of 0.90 % plus a 11 basis credit spread adjustment as of March 31, 2024

The following table summarizes the Company’s debt at the dates indicated:

(dollars in millions) September 30, 2023 December 31, 2022

(dollars in millions) March 31, 2024 December 31, 2023

Revolving Credit Facility due 2026:

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Dollar Term SOFR at average floating rates of 7.31 %

Term B Loan due 2025—U.S.

Dollar Term SOFR at average floating rates of 7.14 %

Term B Loan due 2025—Euribor at average floating rates of 5.85 %

5.0 % Senior Notes due 2027—U.S.

5.700 % Senior Secured Notes due 2028—U.S.

Dollar denominated

6.250 % Senior Secured Notes due 2029—U.S.

Dollar denominated

5.0 % Senior Notes due 2027—U.S.

Dollar denominated

5.700 % Senior Secured Notes due 2028—U.S.

5.0 % Senior Notes due 2026—U.S.

Dollar denominated

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Long-term debt $ 12,819 $ 12,955

Contractual maturities of long-term debt as of September 30, 2023 are as follows:

Contractual maturities of long-term debt as of March 31, 2024 are as follows:

(in millions)

2 unchanged sentences

Senior Secured Credit Facilities

As of September 30, 2023, the Company’s Fifth Amended and Restated Credit Agreement provided financing through several senior secured credit facilities of up to $ 7,998 million, which consisted of $ 6,248 million principal amounts of debt outstanding (as detailed in the table above), and $ 1,745 million of available borrowing capacity on the $ 2,000 million revolving credit facility and standby letters of credit.

As of March 31, 2024, the Company’s Fifth Amended and Restated Credit Agreement provided financing through several senior secured credit facilities of up to $ 6,743 million, which consisted of $ 4,848 million principal amounts of debt outstanding (as detailed in the table above), and $ 1,895 million of available borrowing capacity on the $ 2,000 million revolving credit facility and standby letters of credit.

The revolving credit facility is comprised of a $ 1,175 million senior secured revolving facility available in U.S.

2 unchanged sentences

dollars and Yen.

On April 17, 2023, the Company increased the capacity of its senior secured revolving credit facility by $ 500 million U.S.

dollars, bringing the total capacity of the revolving credit facility to $ 2,000 million.

At the same time, the Company also amended the benchmark rate of the U.S.

dollar revolving credit facility and the U.S.

dollar Term A Loans from U.S.

dollar LIBOR to U.S.

dollar SOFR plus a 10 basis point Credit Spread Adjustment.

On May 23, 2023, IQVIA Inc.

(the “Issuer”), a wholly owned subsidiary of the Company, completed the issuance and sale of $ 750 million in gross proceeds of the Issuer’s 5.700 % senior secured notes due 2028 (the “Senior Secured Notes”) and $ 500 million in gross proceeds of 6.500 % senior notes due 2030 (the “Senior Notes” and, together with the Senior Secured Notes, the “Notes”).

The Senior Secured Notes were issued pursuant to an Indenture, dated May 23, 2023 (the “Secured Notes Indenture”), among the Issuer, U.S.

Bank Trust Company, National Association, as trustee of the Senior Secured Notes and as collateral agent, and the Company and certain subsidiaries of the Issuer as guarantors.

The Senior Notes were issued pursuant to an Indenture, dated May 23, 2023, among the Issuer, U.S.

Bank Trust Company, National Association, as trustee of the Senior Notes, and certain subsidiaries of the Issuer as guarantors (the “Senior Notes Indenture” and, together with the Secured Notes Indenture, the “Indentures”).

The net proceeds from the notes offering were used to repay existing borrowings under the Issuer’s revolving credit facility and to pay fees and expenses related to the Notes offering.

The Notes have not been registered under the Securities Act of 1933, as amended, or the securities laws of any other jurisdiction.

Pursuant to a registration rights agreement entered into in connection with the Notes offering, the Issuer and the guarantors agreed, among other things, to use commercially reasonable efforts to, within certain time periods, file a registration statement with respect to a registered offer to exchange the Senior Secured Notes for new exchange notes, have the exchange offer registration statement declared effective, and complete the exchange offer promptly thereafter, unless the Senior Secured Notes are redeemed earlier.

The Senior Secured Notes are secured obligations of the Issuer, will mature on May 15, 2028, unless earlier repurchased or redeemed in accordance with their terms, and bear interest at the rate of 5.700 % per year, with interest payable semi-annually on May 15 and November 15 of each year, beginning on November 15, 2023.

The Senior Notes are unsecured obligations of the Issuer, will mature on May 15, 2030, unless earlier repurchased or redeemed in accordance with their terms, and bear interest at the rate of 6.500 % per year, with interest payable semi-annually on May 15 and November 15 of each year, beginning on November 15, 2023.

The Issuer may redeem (i) the Senior Secured Notes prior to April 15, 2028 subject to a customary make-whole premium, and thereafter subject to a redemption price equal to 100% of the principal amount thereof plus accrued and unpaid interest and (ii) the Senior Notes prior to their final stated maturity, subject to a customary make-whole premium, at any time prior to May 15, 2026 (subject to a customary “equity claw” redemption right) and thereafter subject to a redemption premium declining from 3.250 % to 0.000 %.

Restrictive Covenants

2 unchanged sentences

The Company’s long-term debt arrangements contain other usual and customary restrictive covenants that, among other things, place limitations on the Company’s ability to declare dividends.

As of September 30, 2023, the Company was in compliance in all material respects with the financial covenants under the Company’s financing arrangements .

As of March 31, 2024, the Company was in compliance in all material respects with the financial covenants under the Company’s financing arrangements .

Contingencies

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The civil lawsuit alleges KPA and KPIC collected their personal information in violation of applicable privacy laws without the necessary consent through a software system installed on pharmacy computer systems in Korea, and that personal information was transferred to IMS Korea and sold to pharmaceutical companies.

On September 11, 2017, the District Court issued a final decision that the encryption in use by the defendants since June 2014 was adequate to meet the requirements of the Korean Personal Information Privacy Act (“PIPA”) and the sharing of non-identified information for market research purposes was allowed under PIPA.

On September 11, 2017, the District Court issued a final decision that the encryption in use by the defendants since June 2014 was adequate to meet the requirements of the Korean Personal Information Protection Act (“PIPA”) and the sharing of non-identified information for market research purposes was allowed under PIPA.

The District Court also found an earlier version of encryption was insufficient to meet PIPA requirements, but no personal data had been leaked or re-identified.

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The Company believes the appeal is without merit and is vigorously defending its position.

On July 23, 2015, indictments were issued by the Seoul Central District Prosecutors’ Office in South Korea against 24 individuals and companies alleging improper handling of sensitive health information in violation of, among others, South Korea’s Personal Information Protection Act.

IMS Korea and two of its employees were among the individuals and organizations indicted.

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Since the initial filings, the parties have filed additional litigations against each other, primarily concerning the use of IQVIA data with various other Veeva products.

The parties are engaged in the discovery process in connection with these lawsuits.

On May 7, 2021, the Court issued an order and opinion (the “Order”) in which it found significant evidence that Veeva had (1) misappropriated IQVIA data and unlawfully used it to improve Veeva data offerings, (2) engaged in a cover-up by deleting significant evidence of its theft of IQVIA’s trade secrets, and (3) improperly withheld certain evidence in furtherance of a crime and/or fraud against IQVIA.

Trial has been scheduled for early 2025.

On May 7, 2021, the Court issued an order and opinion (the “Order”) in which it found significant evidence that Veeva had (1) misappropriated IQVIA data and unlawfully used it to improve Veeva data offerings, (2) engaged in a cover-up by deleting significant evidence of its theft of IQVIA’s trade secrets, and (3) improperly withheld certain evidence under privilege in furtherance of a crime and/or fraud against IQVIA.

The Court imposed five sanctions against Veeva, including ordering three separate adverse inference instructions be issued to the jury and that IQVIA be permitted to present evidence to the jury of Veeva’s destruction efforts.

Veeva is currently appealing the Order.

Veeva appealed the Order.

On March 30, 2024, the Court denied Veeva’s appeal with regard to its rejected privilege claims, while reserving ruling on the appropriate sanctions to be imposed for a later time.

Stockholders’ Equity

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The Company is authorized to issue 1.0 million shares of preferred stock, $ 0.01 per share par value.

No shares of preferred stock were issued or outstanding as of September 30, 2023 or December 31, 2022.

No shares of preferred stock were issued or outstanding as of March 31, 2024 or December 31, 2023.

Equity Repurchase Program

On July 31, 2023, the Company's Board of Directors (the "Board") increased the stock repurchase authorization under the Company's equity repurchase program (the "Repurchase Program") with respect to the repurchase of the Company's common stock by an additional $ 2,000 million, which increased the total amount that has been authorized under the Repurchase Program to $ 11,725 million.

As of March 31, 2024, the total stock repurchase authorization under the Company's equity repurchase program (the "Repurchase Program") was $ 11,725 million.

The Repurchase Program does not obligate the Company to repurchase any particular amount of common stock, and it may be modified, extended, suspended or discontinued at any time.

During the nine months ended September 30, 2023, the Company repurchased 3.9 million shares of its common stock for $ 763 million under the Repurchase Program.

As of September 30, 2023, the Company had remaining authorization to repurchase up to $ 2,592 million of its common stock under the Repurchase Program.

During the three months ended March 31, 2024, the Company did not repurchase any shares of its common stock under the Repurchase Program.

As of March 31, 2024, the Company had remaining authorization to repurchase up to $ 2,363 million of its common stock under the Repurchase Program.

In addition, from time to time, the Company has repurchased and may continue to repurchase common stock through private or other transactions outside of the Repurchase Program.

Business Combinations

The Company completed several individually immaterial acquisitions during the nine months ended September 30, 2023.

The Company completed several individually immaterial acquisitions during the three months ended March 31, 2024.

The Company’s assessment of fair value, including the valuation of certain identified intangibles, and the purchase price allocation related to these acquisitions is preliminary and subject to change upon completion.

Further adjustments may be necessary as additional information related to the fair values of assets acquired and liabilities assumed is assessed during the measurement period (up to one year from the acquisition date).

Further adjustments, largely related to acquired intangible assets and related deferred taxes, may be necessary as additional information related to the fair values of assets acquired and liabilities assumed is assessed during the measurement period (up to one year from the acquisition date).

The Company recorded goodwill from these acquisitions, primarily attributable to assembled workforce, expected synergies and new customer relationships.

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The following table provides certain preliminary financial information for these acquisitions:

(in millions) September 30, 2023

(in millions) March 31, 2024

Assets acquired:

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The following table provides a summary of the preliminary estimated fair value of certain intangible assets acquired:

(in millions) Amortization Period September 30, 2023

(in millions) Amortization Period March 31, 2024

Other identifiable intangibles:

Customer relationships 12 - 13 years $ 52

Backlog 2 years 51

Software and related assets 5 - 8 years 29

Databases 3 - 5 years 3

Trade names 5 years 3

Backlog 1 year 4

Total Other identifiable intangibles $ 56

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The following amounts were recorded for the restructuring plans:

(in millions) Severance and

Related Costs

(in millions) Severance and Related Costs

Balance as of December 31, 2023 $ 36

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Foreign currency translation and other ( 1 )

Balance as of September 30, 2023 $ 42

Balance as of March 31, 2024 $ 34

The reversals were due to changes in estimates primarily resulting from the redeployment of staff and higher than expected voluntary terminations.

Restructuring costs are not allocated to the Company’s reportable segments as they are not part of the segment performance measures regularly reviewed by management.

The Company expects that the majority of the restructuring accruals as of September 30, 2023 will be paid in 2023 and 2024.

The Company's effective income tax rate was 14.6 % and 19.4 % in the third quarter of 2023 and 2022, and 18.7 % and 19.5 % in the first nine months of 2023 and 2022, respectively.

The effective income tax rate in the third quarter and first nine months of 2023 was favorably impacted by a reversal of uncertain tax positions relating to tax credit carryforwards in the amount of $21 million.

Additionally, the effective income tax rate in the third quarter and in the first nine months of 2023 and 2022 was favorably impacted as a result of excess tax benefits recognized upon settlement of share-based compensation awards.

For the third quarter of 2023 and 2022 this impact was $ 2 million and $ 1 million, respectively, and for the first nine months of 2023 and 2022 this impact was $ 12 million and $ 15 million, respectively.

Historically, the Company recorded deferred tax assets related to certain foreign tax credits.

A full valuation allowance in relation to these foreign tax credits was established as it was not expected the credits would be utilized prior to expiration.

As a result of an anticipated internal legal entity restructuring, the Company now believes it is reasonably possible that these foreign tax credits will be utilized and expects to reverse the valuation allowance in the near term which could create a material discrete tax benefit in the period recorded.

The Company expects that the majority of the restructuring accruals as of March 31, 2024 will be paid in 2024 and 2025.

The Company's effective income tax rate was 14.4 % and 19.6 % in the first quarter of 2024 and 2023, respectively.

The effective income tax rate in the first quarter of 2024 was favorably impacted compared to the first quarter of 2023 due to changes in the geographical mix of earnings amongst the United States and foreign tax jurisdictions.

The effective income tax rate in the first quarter of 2024 and 2023 was also favorably impacted by $ 9 million and $ 8 million, respectively, as a result of excess tax benefits recognized upon settlement of share-based compensation awards.

Numerous foreign jurisdictions have agreed to implement the Organization for Economic Co-operation and Development’s (“OECD”) Pillar 2 global corporate minimum tax rate of 15% on companies with revenues of at least €750 million, which went into effect in 2024.

The Company has evaluated the effect of this for the first quarter of 2024 and does not expect any material impacts for 2024 .

The Company will continue to monitor as additional jurisdictions enact Pillar 2 legislation.

Accumulated Other Comprehensive (Loss) Income

Below is a summary of the components of AOCI:

(in millions) Foreign

Translation Derivative

Instruments Defined

(in millions) Foreign Currency Translation Derivative Instruments Defined Benefit Plans Income Taxes Total

Balance as of December 31, 2023 $ ( 969 ) $ ( 34 ) $ 3 $ 133 $ ( 867 )

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Reclassification adjustments — ( 12 ) — 3 ( 9 )

Balance as of September 30, 2023 $ ( 983 ) $ 34 $ ( 7 ) $ 53 $ ( 903 )

Balance as of March 31, 2024 $ ( 1,001 ) $ — $ 3 $ 87 $ ( 911 )

Below is a summary of the adjustments for amounts reclassified from AOCI into the condensed consolidated statements of income and the affected financial statement line item:

(in millions) Affected Financial Statement

Line Item Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

(in millions) Affected Financial Statement Line Item Three Months Ended March 31,

Derivative instruments:

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These costs primarily consist of stock-based compensation and expenses related to integration activities and acquisitions.

The Company also does not allocate depreciation and amortization or impairment charges, if any, to its segments.

The Company also does not allocate restructuring costs, depreciation and amortization, or impairment charges, if any, to its segments.

Asset information by segment is not presented, as this measure is not used by the chief operating decision maker to assess the Company’s performance.

The Company’s reportable segment information is presented below:

Three Months Ended

September 30, Nine Months Ended

September 30,

Three Months Ended March 31,

(in millions) 2024 2023

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Earnings Per Share

The following table reconciles the basic to diluted weighted average shares outstanding:

Three Months Ended September 30, Nine Months Ended September 30,

The following table presents the computation of basic and diluted earnings per share:

Three Months Ended March 31,

(in millions, except per share data) 2024 2023

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Performance awards are included in diluted earnings per share based on if the performance targets have been met at the end of the reporting period.

For the three and nine months ended September 30, 2023 and 2022, the weighted average number of outstanding stock-based awards not included in the computation of diluted earnings per share because they are subject to performance conditions that have not been met at the end of the reporting period or the effect of including such stock-based awards in the computation would be anti-dilutive was 0.9 million and 0.4 million, and 1.0 million and 0.5 million, respectively.

For the three months ended March 31, 2024 and 2023, the weighted average number of outstanding stock-based awards not included in the computation of diluted earnings per share because they are subject to performance conditions that have not been met at the end of the reporting period or the effect of including such stock-based awards in the computation would be anti-dilutive was 0.8 million and 1.0 million, respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements