IQVIA HOLDINGS INC. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations Cautionary Statement for Forward-Looking Information You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (our “2023 Form 10-K”). In addition to historical condensed consolidated financial information, the following discussion contains or incorporates by reference forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are not historical facts but reflect, among other things, our current expectations, our forecasts and our anticipated results of operations, all of which are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, market trends, or industry results to differ materially from those expressed or implied by such forward-looking statements. Therefore, any statements contained herein that are not statements of historical fact may be forward-looking statements and should be evaluated as such. Without limiting the foregoing, the words “assumes,” “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” "forecasts," “plans,” “projects,” “should,” “seeks,” “sees,” “targets,” “will,” “would” and similar words and expressions, and variations and negatives of these words are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We assume no obligation to update any such forward-looking information to reflect actual results or changes in our outlook or the factors affecting such forward-looking information. We caution you that any such forward-looking statements are further qualified by important factors that could cause our actual operating results to differ materially from those in the forward-looking statements, including without limitation, business disruptions caused by natural disasters, pandemics such as the COVID-19 (coronavirus) outbreak, including any variants, and the public health policy responses to the outbreak, and international conflicts or other disruptions outside of our control such as the current situation in Ukraine and Russia; most of our contracts may be terminated on short notice, and we may lose or experience delays with large client contracts or be unable to enter into new contracts; the market for our services may not grow as we expect; we may be unable to successfully develop and market new services or enter new markets; imposition of restrictions on our use of data by data suppliers or their refusal to license data to us; any failure by us to comply with contractual, regulatory or ethical requirements under our contracts, including current or future changes to data protection and privacy laws; breaches or misuse of our or our outsourcing partners’ security or communications systems; failure to meet our productivity or business transformation objectives; failure to successfully invest in growth opportunities; our ability to protect our intellectual property rights and our susceptibility to claims by others that we are infringing on their intellectual property rights; the expiration or inability to acquire third party licenses for technology or intellectual property; any failure by us to accurately and timely price and formulate cost estimates for contracts, or to document change orders; hardware and software failures, delays in the operation of our computer and communications systems or the failure to implement system enhancements; the rate at which our backlog converts to revenues; our ability to acquire, develop and implement technology necessary for our business; consolidation in the industries in which our clients operate; risks related to client or therapeutic concentration; government regulators or our customers may limit the number or scope of indications for medicines and treatments or withdraw products from the market, and government regulators may impose new regulatory requirements or may adopt new regulations affecting the biopharmaceutical industry; the risks associated with operating on a global basis, including currency or exchange rate fluctuations and legal compliance, including anti-corruption laws; risks related to changes in accounting standards; general economic conditions in the markets in which we operate, including financial market conditions, inflation and risks related to sales to government entities; the impact of changes in tax laws and regulations; and our ability to successfully integrate, and achieve expected benefits from, our acquired businesses. For a further discussion of the risks relating to our business, see Part I—Item 1A—“Risk Factors” in our 2023 Form 10-K, as updated in our subsequently filed Quarterly Reports on Form 10-Q. Overview IQVIA is a leading global provider of clinical research services, commercial insights and healthcare intelligence to the life sciences and healthcare industries. IQVIA’s portfolio of solutions are powered by IQVIA Connected Intelligence™ to deliver actionable insights and services built on high-quality health data, Healthcare-grade AI™, advanced analytics, the latest technologies and extensive domain expertise. With approximately 88,000 employees in over 100 countries, including experts in healthcare, life sciences, data science, technology and operational excellence, IQVIA is dedicated to accelerating the development and commercialization of innovative medical treatments to help improve patient outcomes and population health worldwide. 23 Table of contents We are a global leader in protecting individual patient privacy. We use a wide variety of privacy-enhancing technologies and safeguards to protect individual privacy while generating and analyzing information on a scale that helps healthcare stakeholders identify disease patterns and correlate with the precise treatment path and therapy needed for better outcomes. Our insights and execution capabilities help biotech, medical device and pharmaceutical companies, medical researchers, government agencies, payers and other healthcare stakeholders tap into a deeper understanding of diseases, human behaviors and scientific advances, in an effort to advance their path toward cures. We are managed through three reportable segments: Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions. Technology & Analytics Solutions provides mission critical information, technology solutions and real world insights and services to our life science clients. Research & Development Solutions, which primarily serves biopharmaceutical customers, provides outsourced clinical research and clinical trial related services. Contract Sales & Medical Solutions provides health care provider (including contract sales) and patient engagement services to both biopharmaceutical clients and the broader healthcare market. Sources of Revenue Total revenues are comprised of revenues from the provision of our services. We do not have any material product revenues. Costs and Expenses Our costs and expenses are comprised primarily of our cost of revenues including reimbursed expenses and selling, general and administrative expenses. Cost of revenues includes compensation and benefits for billable employees and personnel involved in production, trial monitoring, data management and delivery, and the costs of acquiring and processing data for our information offerings; costs of staff directly involved with delivering technology-related services offerings and engagements, related accommodations and the costs of data purchased specifically for technology services engagements; and other expenses directly related to service contracts such as courier fees, laboratory supplies, professional services and travel expenses. Reimbursed expenses, which are included in cost of revenues, are comprised principally of payments to investigators who oversee clinical trials and travel expenses for our clinical monitors and sales representatives. Selling, general and administrative expenses include costs related to sales, marketing and administrative functions (including human resources, legal, finance, quality assurance, compliance and general management) for compensation and benefits, travel, professional services, training and expenses for information technology and facilities. We also incur costs and expenses associated with depreciation and amortization. Foreign Currency Translation In the first nine months of 2024, approximately 30% of our revenues were denominated in currencies other than the United States dollar, which represents approximately 60 currencies. Because a large portion of our revenues and expenses are denominated in foreign currencies and our financial statements are reported in United States dollars, changes in foreign currency exchange rates can significantly affect our results of operations. The revenues and expenses of our foreign operations are generally denominated in local currencies and translated into United States dollars for financial reporting purposes. Accordingly, exchange rate fluctuations will affect the translation of foreign results into United States dollars for purposes of reporting our condensed consolidated results. As a result, we believe that reporting results of operations that exclude the effects of foreign currency rate fluctuations on certain financial results can facilitate analysis of period to period comparisons. This constant currency information assumes the same foreign currency exchange rates that were in effect for the comparable prior-year period were used in translation of the current period results. As such, the differences noted below between reported results of operations and constant currency information is wholly attributable to the effects of foreign currency rate fluctuations. Consolidated Results of Operations For information regarding our results of operations for Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions, refer to “Segment Results of Operations” later in this section. 24 Table of contents Revenues Three Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 3,896 $ 3,736 $ 160 4.3 % For the third quarter of 2024, our revenues increased $160 million, or 4.3%, as compared to the same period in 2023. This increase was comprised of constant currency revenue growth of approximately $158 million, or 4.2%, reflecting a $118 million increase in Technology & Analytics Solutions, a $42 million increase in Research & Development Solutions, and a $2 million decrease in Contract Sales & Medical Solutions. Nine Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 11,447 $ 11,116 $ 331 3.0 % For the first nine months of 2024, our revenues increased $331 million, or 3.0%, as compared to the same period in 2023. This increase was comprised of constant currency revenue growth of approximately $393 million, or 3.5%, reflecting a $188 million increase in Technology & Analytics Solutions, a $189 million increase in Research & Development Solutions, and a $16 million increase in Contract Sales & Medical Solutions. Cost of Revenues, exclusive of Depreciation and Amortization Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Cost of revenues, exclusive of depreciation and amortization $ 2,518 $ 2,426 $ 7,450 $ 7,267 % of revenues 64.6 % 64.9 % 65.1 % 65.4 % The $92 million increase in cost of revenues, exclusive of depreciation and amortization, for the three months ended September 30, 2024 as compared to the same period in 2023 included a constant currency increase of approximately $156 million, or 6.4%, reflecting a $70 million increase in Technology & Analytics Solutions, a $88 million increase in Research & Development Solutions, and a $2 million decrease in Contract Sales & Medical Solutions. The $183 million increase in cost of revenues, exclusive of depreciation and amortization, for the nine months ended September 30, 2024 as compared to the same period in 2023 included a constant currency increase of approximately $480 million, or 6.6%, reflecting a $154 million increase in Technology & Analytics Solutions, a $311 million increase in Research & Development Solutions, and a $15 million increase in Contract Sales & Medical Solutions. Selling, General and Administrative Expenses Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Selling, general and administrative expenses $ 522 $ 502 $ 1,539 $ 1,497 % of revenues 13.4 % 13.4 % 13.4 % 13.5 % The $20 million increase in selling, general and administrative expenses for the three months ended September 30, 2024 as compared to the same period in 2023 included a constant currency increase of approximately $19 million, or 3.8%, reflecting a $8 million increase in Technology & Analytics Solutions, a $7 million increase in Research & Development Solutions, and a $4 million increase in general corporate and unallocated expenses. The $42 million increase in selling, general and administrative expenses for the nine months ended September 30, 2024 as compared to the same period in 2023 included a constant currency increase of approximately $64 million, or 4.3%, reflecting a $37 million increase in Technology & Analytics Solutions, a $35 million increase in Research & Development Solutions, and a $2 million increase in Contract Sales & Medical Solutions, offset by a $10 million decrease in general corporate and unallocated expenses. 25 Table of contents Depreciation and Amortization Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Depreciation and amortization $ 278 $ 297 $ 811 $ 809 % of revenues 7.1 % 7.9 % 7.1 % 7.3 % The $19 million decrease in depreciation and amortization for the three months ended September 30, 2024 compared to the same period in 2023 was primarily the result of less amortization of intangible assets from acquisitions. The $2 million increase in depreciation and amortization for the nine months ended September 30, 2024 compared to the same period in 2023 was primarily the result of an increase in amortization of capitalized software. Restructuring Costs Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Restructuring costs $ 28 $ 30 $ 71 $ 67 The restructuring costs incurred during 2024 and 2023 were due to ongoing efforts to streamline our global operations and reduce overcapacity to adapt to changing market conditions and integrate acquisitions. These restructuring actions are expected to occur throughout 2024 and into 2025 and are expected to consist of consolidating functional activities, eliminating redundant positions and aligning resources with customer requirements. Interest Income and Interest Expense Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Interest income $ (13) $ (14) $ (36) $ (24) Interest expense $ 170 $ 181 $ 499 $ 491 Interest income includes interest received primarily from bank balances and investments. The decrease for the three months ended September 30, 2024 as compared to the same period in 2023 is primarily a result of lower global deposit rates. The increase for the nine months ended September 30, 2024 as compared to the same period in 2023 is primarily a result of higher deposit rates. Interest expense during the three months ended September 30, 2024 decreased compared to the same period in 2023 primarily due to lower debt balances. For the nine months ended September 30, 2024, interest expense increased as a result of higher base rate interest costs across the floating rate debt portfolio. Other Expense (Income), Net Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Other expense (income), net $ 44 $ (35) $ (12) $ (77) Other expense (income), net for the three months ended September 30, 2024 increased compared to the same period in 2023 primarily due to foreign currency loss on transactions and to a lesser extent from revaluations of contingent consideration arrangements. Other expense (income), net for the nine months ended September 30, 2024 decreased compared to the same period in 2023 primarily due to foreign currency loss on transactions. 26 Table of contents Income Tax Expense Three Months Ended September 30, Nine Months Ended September 30, (in millions) 2024 2023 2024 2023 Income tax expense $ 65 $ 51 $ 189 $ 203 Our effective income tax rate was 18.6% and 14.6% in the third quarter of 2024 and 2023, and 16.8% and 18.7% in the first nine months of 2024 and 2023, respectively. Our effective income tax rate in the third quarter and in the first nine months of 2024 was favorably impacted due to changes in the geographical mix of earnings amongst the United States and foreign tax jurisdictions. Our 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. Our effective income tax rate in the third quarter and in the first nine months of 2024 and 2023 was also favorably impacted as a result of excess tax benefits recognized upon settlement of share-based compensation awards. For both the third quarter of 2024 and 2023 this impact was $2 million, and for the first nine months of 2024 and 2023 this impact was $14 million and $12 million, respectively. Numerous foreign jurisdictions have agreed to implement the OECD's Pillar 2 global corporate minimum tax rate of 15% on companies with revenues of at least €750 million, which went into effect in 2024. We have continued to evaluate the effect of this through the end of the third quarter of 2024 and do not expect any material impacts for 2024. We will continue to monitor in future periods as additional jurisdictions enact Pillar 2 legislation. Segment Results of Operations Revenues and profit by segment are as follows: Three Months Ended September 30, 2024 and 2023 Segment Revenues Segment Profit (in millions) 2024 2023 2024 2023 Technology & Analytics Solutions $ 1,554 $ 1,431 $ 405 $ 355 Research & Development Solutions 2,162 2,122 498 495 Contract Sales & Medical Solutions 180 183 12 12 Total 3,896 3,736 915 862 General corporate and unallocated (59) (54) Depreciation and amortization (278) (297) Restructuring costs (28) (30) Consolidated $ 3,896 $ 3,736 $ 550 $ 481 Nine Months Ended September 30, 2024 and 2023 Segment Revenues Segment Profit (in millions) 2024 2023 2024 2023 Technology & Analytics Solutions $ 4,502 $ 4,331 $ 1,101 $ 1,086 Research & Development Solutions 6,404 6,244 1,470 1,391 Contract Sales & Medical Solutions 541 541 34 37 Total 11,447 11,116 2,605 2,514 General corporate and unallocated (147) (162) Depreciation and amortization (811) (809) Restructuring costs (71) (67) Consolidated $ 11,447 $ 11,116 $ 1,576 $ 1,476 Certain costs are not allocated to our segments and are reported as general corporate and unallocated expenses. These costs primarily consist of stock-based compensation and expenses related to integration activities and acquisitions. We also do not allocate restructuring costs, depreciation and amortization, or impairment charges, if any, to our segments. 27 Table of contents Technology & Analytics Solutions Three Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 1,554 $ 1,431 $ 123 8.6 % Cost of revenues, exclusive of depreciation and amortization 922 859 63 7.3 Selling, general and administrative expenses 227 217 10 4.6 Segment profit $ 405 $ 355 $ 50 14.1 % Nine Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 4,502 $ 4,331 $ 171 3.9 % Cost of revenues, exclusive of depreciation and amortization 2,720 2,593 127 4.9 Selling, general and administrative expenses 681 652 29 4.4 Segment profit $ 1,101 $ 1,086 $ 15 1.4 % Revenues Technology & Analytics Solutions’ revenues were $1,554 million for the third quarter of 2024, an increase of $123 million, or 8.6%, over the same period in 2023. This increase was comprised of constant currency revenue growth of approximately $118 million, or 8.2%, reflecting revenue growth primarily in the Europe and Africa region and to a lesser extent in the Americas region. Technology & Analytics Solutions’ revenues were $4,502 million for the first nine months of 2024, an increase of $171 million, or 3.9%, over the same period in 2023. This increase was comprised of constant currency revenue growth of approximately $188 million, or 4.3%, reflecting revenue growth primarily in the Europe and Africa region and to a lesser extent in the Americas region. The constant currency revenue growth for the three and nine months ended September 30, 2024 was primarily driven by an increase in information and technology services and to a lesser extent by real world services. The constant currency revenue growth for the nine months ended September 30, 2024 was impacted by a decrease in COVID-19 related work. Cost of Revenues, exclusive of Depreciation and Amortization Technology & Analytics Solutions’ cost of revenues, exclusive of depreciation and amortization, increased $63 million, or 7.3%, in the third quarter of 2024 over the same period in 2023. This increase included a constant currency increase of approximately $70 million, or 8.1%. Technology & Analytics Solutions’ cost of revenues, exclusive of depreciation and amortization, increased $127 million, or 4.9%, in the first nine months of 2024 over the same period in 2023. This increase included a constant currency increase of approximately $154 million, or 5.9%. The constant currency increase for the three and nine months ended September 30, 2024 was mainly related to an increase in compensation and related expenses, and to a lesser extent from increases in reimbursed expenses and costs of acquiring and processing data to support revenue growth. Selling, General and Administrative Expenses Technology & Analytics Solutions’ selling, general and administrative expenses increased $10 million, or 4.6%, in the third quarter of 2024 as compared to the same period in 2023, which included a constant currency increase of approximately $8 million, or 3.7%. 28 Table of contents Technology & Analytics Solutions’ selling, general and administrative expenses increased $29 million, or 4.4%, in the first nine months of 2024 as compared to the same period in 2023, which included a constant currency increase of approximately $37 million, or 5.7%. The constant currency increase for the three and nine months ended September 30, 2024 was primarily related to an increase in compensation and related expenses. Research & Development Solutions Three Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 2,162 $ 2,122 $ 40 1.9 % Cost of revenues, exclusive of depreciation and amortization 1,442 1,410 32 2.3 Selling, general and administrative expenses 222 217 5 2.3 Segment profit $ 498 $ 495 $ 3 0.6 % Nine Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 6,404 $ 6,244 $ 160 2.6 % Cost of revenues, exclusive of depreciation and amortization 4,268 4,213 55 1.3 Selling, general and administrative expenses 666 640 26 4.1 Segment profit $ 1,470 $ 1,391 $ 79 5.7 % Backlog Research & Development Solutions’ contracted backlog increased from $29.7 billion as of December 31, 2023 to $31.1 billion as of September 30, 2024, and we expect approximately $7.8 billion of this backlog to convert to revenues in the next twelve months. Revenues Research & Development Solutions’ revenues were $2,162 million for the third quarter of 2024, an increase of $40 million, or 1.9%, over the same period in 2023. This increase was comprised of constant currency revenue growth of approximately $42 million, or 2.0%, reflecting revenue growth primarily in the Europe and Africa region. Research & Development Solutions’ revenues were $6,404 million in the first nine months of 2024, an increase of $160 million, or 2.6%, over the same period in 2023. This increase was comprised of constant currency revenue growth of approximately $189 million, or 3.0%, reflecting revenue growth primarily in the Europe and Africa region and to a lesser extent in the Asia-Pacific region. The constant currency revenue growth for the three and nine months ended September 30, 2024 was primarily the result of volume-related increases in clinical services and to a lesser extent from volume-related increases in lab testing. The constant currency revenue growth was impacted by a decrease in COVID-19 related work. Cost of Revenues, exclusive of Depreciation and Amortization Research & Development Solutions’ cost of revenues, exclusive of depreciation and amortization, increased $32 million, or 2.3%, in the third quarter of 2024 over the same period in 2023. This increase included a constant currency increase of approximately $88 million, or 6.2%. Research & Development Solutions’ cost of revenues, exclusive of depreciation and amortization, increased $55 million, or 1.3%, in the first nine months of 2024 over the same period in 2023. This increase included a constant currency increase of approximately $311 million, or 7.4%. 29 Table of contents The constant currency increase for the three and nine months ended September 30, 2024 was primarily related to an increase in compensation and related expenses as a result of volume-related increases in clinical services and lab testing. Selling, General and Administrative Expenses Research & Development Solutions’ selling, general and administrative expenses increased $5 million, or 2.3%, in the third quarter of 2024 as compared to the same period in 2023, which included a constant currency increase of approximately $7 million, or 3.2%. Research & Development Solutions’ selling, general and administrative expenses increased $26 million, or 4.1%, in the first nine months of 2024 as compared to the same period in 2023, which included a constant currency increase of approximately $35 million, or 5.5%. The constant currency increase for the three and nine months ended September 30, 2024 was primarily related to an increase in compensation and related expenses. Contract Sales & Medical Solutions Three Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 180 $ 183 $ (3) (1.6) % Cost of revenues, exclusive of depreciation and amortization 154 157 (3) (1.9) Selling, general and administrative expenses 14 14 — — Segment profit $ 12 $ 12 $ — — % Nine Months Ended September 30, Change (in millions) 2024 2023 $ % Revenues $ 541 $ 541 $ — — % Cost of revenues, exclusive of depreciation and amortization 462 461 1 0.2 Selling, general and administrative expenses 45 43 2 4.7 Segment profit $ 34 $ 37 $ (3) (8.1) % Revenues Contract Sales & Medical Solutions’ revenues were $180 million for the third quarter of 2024, a decrease of $3 million, or 1.6%, over the same period in 2023. This decrease was comprised of constant currency revenue decrease of approximately $2 million, or 1.1%. Contract Sales & Medical Solutions’ revenues were $541 million in the first nine months of 2024, which is consistent with the same period in 2023. The comparison to the same period in 2023 includes constant currency revenue growth of approximately $16 million, or 3.0%, reflecting revenue growth in the Europe and Africa region and to a lesser extent the Asia-Pacific region. The constant currency revenue growth for the nine months ended September 30, 2024 was primarily due to volume-related increases in services performed. Cost of Revenues, exclusive of Depreciation and Amortization Contract Sales & Medical Solutions’ cost of revenues, exclusive of depreciation and amortization, decreased $3 million, or 1.9%, in the third quarter of 2024 as compared to the same period in 2023. This decrease included a constant currency decrease of approximately $2 million, or 1.3%. 30 Table of contents Contract Sales & Medical Solutions’ cost of revenues, exclusive of depreciation and amortization, increased $1 million, or 0.2%, in the first nine months of 2024 as compared to the same period in 2023. This increase included a constant currency increase of approximately $15 million, or 3.3%. The constant currency increase for the nine months ended September 30, 2024 was primarily related to an increase in costs associated with supporting revenue growth. Selling, General and Administrative Expenses Contract Sales & Medical Solutions’ selling, general and administrative expenses in the third quarter of 2024 were consistent with the same period in 2023. Contract Sales & Medical Solutions’ selling, general and administrative expenses increased $2 million, or 4.7%, in the first nine months of 2024 as compared to the same period in 2023, which included a constant currency increase of approximately $2 million, or 4.7%. Liquidity and Capital Resources Overview We assess our liquidity in terms of our ability to generate cash to fund our operating, investing and financing activities. Our principal source of liquidity is operating cash flows. In addition to operating cash flows, other significant factors that affect our overall management of liquidity include: capital expenditures, acquisitions, investments, debt service requirements, equity repurchases, adequacy of our revolving credit and receivables financing facilities, and access to the capital markets. We manage our worldwide cash requirements by monitoring the funds available among our subsidiaries and determining the extent to which those funds can be accessed on a cost-effective basis. The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences; however, those balances are generally available without legal restrictions to fund ordinary business operations. We have and expect to transfer cash from those subsidiaries to the United States and to other international subsidiaries when it is cost effective to do so. We had a cash balance of $1,572 million as of September 30, 2024 ($538 million of which was in the United States), an increase from $1,376 million as of December 31, 2023. Based on our current operating plan, we believe that our available cash and cash equivalents, future cash flows from operations and our ability to access funds under our revolving credit and receivables financing facilities will enable us to fund our operating requirements, capital expenditures, contractual obligations, and meet debt obligations for at least the next 12 months. We regularly evaluate our debt arrangements, as well as market conditions, and from time to time we may explore opportunities to modify our existing debt arrangements or pursue additional financing arrangements that could result in the issuance of new debt securities by us or our affiliates. We may use our existing cash, cash generated from operations or dispositions of assets or businesses and/or proceeds from any new financing arrangements or issuances of debt or equity securities to repay or reduce some of our outstanding obligations, to repurchase shares from our stockholders or for other purposes. As part of our ongoing business strategy, we also continually evaluate new acquisition, expansion and investment possibilities or other strategic growth opportunities, as well as potential dispositions of assets or businesses, as appropriate, including dispositions that may cause us to recognize a loss on certain assets. Should we elect to pursue any such transaction, we may seek to obtain debt or equity financing to facilitate those activities. Our ability to enter into any such potential transactions and our use of cash or proceeds is limited to varying degrees by the terms and restrictions contained in our existing debt arrangements. We cannot provide assurances that we will be able to complete any such financing arrangements or other transactions on favorable terms or at all. Equity Repurchase Program As of September 30, 2024, the total stock repurchase authorization under our equity repurchase program (the “Repurchase Program”) was $11,725 million. The Repurchase Program does not obligate us to repurchase any particular amount of common stock, and it may be modified, extended, suspended or discontinued at any time. 31 Table of contents During the nine months ended September 30, 2024, we repurchased 0.8 million shares of our common stock for $200 million under the Repurchase Program. As of September 30, 2024, we had remaining authorization to repurchase up to $2,163 million of our common stock under the Repurchase Program. In addition, from time to time, we have repurchased and may continue to repurchase common stock through private or other transactions outside of the Repurchase Program. Debt As of September 30, 2024, we had $13,578 million of total indebtedness, excluding $1,995 million of additional available borrowings under our revolving credit facility. Our long-term debt arrangements contain customary restrictive covenants and, as of September 30, 2024, we believe we were in compliance with our restrictive covenants in all material respects. Senior Secured Credit Facilities As of September 30, 2024, our Fifth Amended and Restated Credit Agreement provided financing through the senior secured credit facilities of up to $6,688 million, which consisted of $4,693 million principal amounts of debt outstanding, and $1,995 million of available borrowing capacity on the revolving credit facility and standby letters of credit. See Note 7 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details regarding our credit arrangements. Receivables Financing Facility On October 1, 2024, we amended our receivables financing facility to extend the term of the $550 million facility to October 1, 2027. Under the receivables financing facility, certain of our accounts receivable are sold on a non-recourse basis by certain of our consolidated subsidiaries (each, an “Originator”) to another of our consolidated subsidiaries, a bankruptcy-remote special purpose entity (the “SPE”). The SPE obtained a term loan and revolving loan commitment from third-party lenders, secured by liens on the assets of the SPE, to finance the purchase of the accounts receivable, which includes a $440 million term loan and a $110 million revolving loan commitment. As of September 30, 2024, no additional amounts of revolving loans were available under the receivables financing facility. Nine months ended September 30, 2024 and 2023 Cash Flow from Operating Activities Nine Months Ended September 30, (in millions) 2024 2023 Net cash provided by operating activities $ 1,831 $ 1,402 Cash provided by operating activities increased $429 million during the first nine months of 2024 as compared to the same period in 2023. The increase was due to an increase in cash from accounts receivable and unbilled services ($557 million) and from cash-related net income ($23 million), offset by a decrease in cash from other operating assets and liabilities ($94 million) and unearned income ($57 million). Cash Flow from Investing Activities Nine Months Ended September 30, (in millions) 2024 2023 Net cash used in investing activities $ (1,134) $ (1,391) Cash used in investing activities decreased $257 million during the first nine months of 2024 as compared to the same period in 2023, primarily driven by less cash used for acquisitions of businesses ($220 million), investments in debt and equity securities ($34 million), acquisitions of property, equipment and software ($32 million), purchases of marketable securities, net ($4 million) and cash received from sale of property, equipment and software ($25 million), offset by more cash used in investments in unconsolidated affiliates, net ($52 million) and less cash from other ($6 million). 32 Table of contents Cash Flow from Financing Activities Nine Months Ended September 30, (in millions) 2024 2023 Net cash (used in) provided by financing activities $ (503) $ 38 Cash used in financing activities increased $541 million during the first nine months of 2024 as compared to the same period in 2023, primarily due to less cash from debt issuance, net ($1,231 million), more cash payments on debt and principal payments on finance leases ($12 million) and cash payments related to employee stock incentive plans ($3 million), offset by less cash used for repurchase of common stock ($563 million), for revolving credit facilities, net of repayments ($75 million) and payments for contingent consideration and deferred purchase price accruals ($67 million). Information about our Guarantors and the Issuer of our Guaranteed Securities IQVIA Inc. (the “Issuer”), a wholly owned subsidiary of IQVIA Holdings Inc., completed the issuance and sale of $1,250 million in gross proceeds of the Issuer’s 6.250% senior secured notes due 2029 (the “2029 Senior Secured Notes”) on November 28, 2023, and completed the issuance and sale of $750 million in gross proceeds of the Issuer’s 5.700% senior secured notes due 2028 (the “2028 Senior Secured Notes”) on May 23, 2023. In February 2024, the Issuer completed an exchange offer in which it issued $1,250 million aggregate principal amount of 6.250% Senior Secured Notes due 2029 registered under the Securities Act (the “2029 Registered Notes”) and $750 million aggregate principal amount of 5.700% Senior Secured Notes due 2028 registered under the Securities Act (the “2028 Registered Notes” and, together with the 2029 Registered Notes, the 2029 Senior Secured Notes, and the 2028 Senior Secured Notes, the “Notes”) in exchange for the same principal amount and substantially identical terms of the 2029 Senior Secured Notes and 2028 Senior Secured Notes, respectively. The accompanying summarized financial information has been prepared and presented pursuant to Rule 3-10 of Regulation S-X, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered,” and Rule 13-01 of Regulation S-X, “Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralized a Registrant’s Securities.” Each of our current direct and indirect material U.S. wholly owned restricted subsidiaries (excluding IQVIA Solutions Japan LLC and IQVIA Services Japan LLC) (the "Guarantor subsidiaries" and, together with IQVIA Holdings Inc., the “Guarantors”), have jointly and severally, irrevocably and unconditionally, on a senior secured basis, guaranteed the obligations under the Notes. The following presents the summarized financial information on a combined basis for IQVIA Holdings Inc. (parent company), IQVIA Inc. (issuer of the guaranteed obligations) and the Guarantor subsidiaries, which are collectively referred to as the “obligated group.” Each Guarantor subsidiary is consolidated by IQVIA Holdings Inc. as of September 30, 2024 and December 31, 2023. Refer to Exhibit 22.1 to this Quarterly Report on Form 10-Q for the detailed list of entities included within the obligated group as of September 30, 2024. The guarantee of a Guarantor subsidiary with respect to the Notes will be automatically and unconditionally released and discharged and shall terminate and be of no further force and effect, and no further action by such Guarantor subsidiary, the Issuer, or U.S. Bank Trust Company, National Association, as trustee, be required upon the occurrence of any of the following: a. any sale, exchange, issuance, disposition or transfer (by merger, amalgamation, consolidation or otherwise) of (i) the capital stock of such Guarantor, after which the applicable Guarantor is no longer a Restricted Subsidiary, or (ii) all or substantially all of the assets of such Guarantor, in each case if such sale, exchange, issuance, disposition or transfer is made in compliance with the applicable provisions of this Indenture; b. the release or discharge of the guarantee by such Guarantor of indebtedness under the senior secured term loan facilities and the senior secured revolving credit facilities under that certain Fifth Amended and Restated Credit Agreement, or the release or discharge of such other guarantee that resulted in the creation of such Guarantee, except, in each case, a discharge or release by or as a result of payment of such Indebtedness or under such guarantee (it being understood that a release subject to a contingent reinstatement is still a release, and that if any such guarantee is so reinstated, such Guarantee shall also be reinstated to the extent that such Guarantor would then be required to provide a Guarantee pursuant to Section 4.11 of the Indenture); 33 Table of contents c. the designation of any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in compliance with the applicable provisions of the Indenture; d. the exercise by the Issuer of its Legal Defeasance option or Covenant Defeasance option in accordance with Article VIII of the Indenture or the discharge of the Issuer’s obligations under the Indenture in accordance with the terms of this Indenture; e. the merger, amalgamation or consolidation of any Guarantor with and into the Issuer or a Guarantor that is the surviving Person in such merger, amalgamation or consolidation, or upon the liquidation of a Guarantor following the transfer of all or substantially all of its assets, in each case in a transaction that complies with the applicable provisions of this Indenture; or f. as described in Article IX of the Indenture. Summarized Combined Financial Information of the Issuer and Guarantors : Each entity in the summarized combined financial information follows the same accounting policies as previously disclosed in Note 1 of the consolidated financial statements of our 2023 Form 10-K. Information for the non-Guarantor subsidiaries has been excluded from the combined summarized financial information of the obligated group. The accompanying summarized combined financial information does not reflect investments of the obligated group in non-Guarantor subsidiaries. The financial information of the obligated group is presented on a combined basis; intercompany balances and transactions within the obligated group have been eliminated. The obligated group’s amounts due from and amounts due to non-Guarantor subsidiaries and related parties have been presented in separate line items. The following table contains summarized combined financial information from the Statements of Unaudited Condensed Consolidated Financial Position of the obligated group as of: (in millions) September 30, 2024 December 31, 2023 Total current assets (excluding amounts due from subsidiaries that are non-Guarantors) $ 756 $ 805 Total noncurrent assets $ 10,789 $ 9,622 Amounts due from subsidiaries that are non-Guarantors $ 4,390 $ 4,762 Total current liabilities $ 4,047 $ 3,471 Total noncurrent liabilities $ 11,611 $ 12,334 Amounts due to subsidiaries that are non-Guarantors $ 6,131 $ 5,556 The following table contains summarized combined financial information from the Statements of Unaudited Condensed Consolidated Operations of the obligated group: Nine months ended Twelve months ended (in millions) September 30, 2024 December 31, 2023 Net revenues $ 4,979 $ 6,299 Costs and expenses applicable to net revenues $ 3,120 $ 4,190 Income from operations $ 897 $ 912 Net income $ 237 $ 86 Off-Balance Sheet Arrangements We do not have any material off-balance sheet arrangements. Contractual Obligations and Commitments We have various contractual obligations, which are recorded as liabilities in our consolidated financial statements. 34 Table of contents There have been no material changes, outside of the ordinary course of business, to our contractual obligations as previously disclosed in our 2023 Form 10-K. Application of Critical Accounting Policies There have been no material changes to our critical accounting policies as previously disclosed in our 2023 Form 10-K. Item 3. Quantitative and Qualitative Disclosures About Market Risk There have been no material changes to our quantitative and qualitative disclosures about market risk as compared to the quantitative and qualitative disclosures about market risk described in our 2023 Form 10-K.