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Item 1. Financial Statements

2025-08-26 compared with 2025-02-25 · 317 added, 339 removed, 674 unchanged (49% of the section changed)

2 unchanged sentences

Consolidated Statements of Income

Three months ended Nine months ended

(in millions, except per share data) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Three months ended

(in millions, except per share data) July 25, 2025 July 26, 2024

Net sales $ 8,578 $ 7,915

6 unchanged sentences

Certain litigation charges, net 27 81

Other operating (income) expense, net ( 5 ) 17 ( 38 ) ( 13 )

Other operating expense, net 70 1

Operating profit 1,445 1,278

13 unchanged sentences

Consolidated Statements of Comprehensive Income

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Three months ended

(in millions) July 25, 2025 July 26, 2024

Net income $ 1,047 $ 1,049

Other comprehensive income (loss), net of tax:

Unrealized (loss) gain on investment securities ( 1 ) 111 110 73

Unrealized gain on investment securities 19 76

Translation adjustment 349 102

Net investment hedge 780 ( 424 ) 610 348

Net investment hedges ( 559 ) ( 206 )

Net change in retirement obligations 1 1

Unrealized gain (loss) on cash flow hedges 292 ( 220 ) 200 74

Other comprehensive income (loss) 409 ( 81 ) 478 39

Unrealized loss on cash flow hedges ( 128 ) ( 66 )

Other comprehensive loss ( 318 ) ( 92 )

Comprehensive income including noncontrolling interests 729 957

4 unchanged sentences

Consolidated Balance Sheets

(in millions) January 24, 2025 April 26, 2024

(in millions) July 25, 2025 April 25, 2025

Current assets:

46 unchanged sentences

Net income — — — 1,040 — 1,040 7 1,047

Other comprehensive loss — — — — ( 92 ) ( 92 ) — ( 92 )

Other comprehensive (loss) income — — — — ( 319 ) ( 319 ) 1 ( 318 )

Dividends to shareholders ($ 0.71 per ordinary share)

4 unchanged sentences

July 25, 2025 1,282 $ — $ 20,891 $ 31,606 $ ( 4,604 ) $ 47,893 $ 240 $ 48,133

Net income — — — 1,270 — 1,270 9 1,278

Other comprehensive income — — — — 161 161 — 161

Dividends to shareholders ($ 0.70 per ordinary share)

— — — ( 897 ) — ( 897 ) — ( 897 )

Issuance of shares under stock purchase and award plans 3 — 103 — — 103 — 103

Repurchase of ordinary shares ( 3 ) — ( 248 ) — — ( 248 ) — ( 248 )

Stock-based compensation — — 159 — — 159 — 159

October 25, 2024 1,283 $ — $ 20,824 $ 30,919 $ ( 3,250 ) $ 48,494 $ 222 $ 48,716

Net income — — — 1,294 — 1,294 9 1,303

Other comprehensive income (loss) — — — — 411 411 ( 1 ) 409

Dividends to shareholders ($ 0.70 per ordinary share)

— — — ( 897 ) — ( 897 ) — ( 897 )

Issuance of shares under stock purchase and award plans 3 — 152 — — 152 — 152

Repurchase of ordinary shares ( 2 ) — ( 164 ) — — ( 164 ) — ( 164 )

Stock-based compensation — — 98 — — 98 — 98

Changes to noncontrolling ownership interests — — — — — — ( 2 ) ( 2 )

January 24, 2025 1,283 $ — $ 20,910 $ 31,317 $ ( 2,839 ) $ 49,387 $ 228 $ 49,615

Ordinary Shares Additional Paid-in Capital Retained

13 unchanged sentences

July 26, 2024 1,282 $ — $ 20,810 $ 30,547 $ ( 3,410 ) $ 47,947 $ 213 $ 48,160

Net income — — — 909 — 909 2 911

Other comprehensive income (loss) — — — — 297 297 ( 2 ) 295

Dividends to shareholders ($ 0.69 per ordinary share)

— — — ( 918 ) — ( 918 ) — ( 918 )

Issuance of shares under stock purchase and award plans 2 — 35 — — 35 — 35

Repurchase of ordinary shares ( 2 ) — ( 189 ) — — ( 189 ) — ( 189 )

Stock-based compensation — — 146 — — 146 — 146

October 27, 2023 1,330 $ — $ 24,580 $ 30,256 $ ( 3,377 ) $ 51,460 $ 187 $ 51,647

Net income — — — 1,322 — 1,322 15 1,337

Other comprehensive (loss) income — — — — ( 82 ) ( 82 ) 1 ( 81 )

Dividends to shareholders ($ 0.69 per ordinary share)

— — — ( 917 ) — ( 917 ) — ( 917 )

Issuance of shares under stock purchase and award plans 1 — 49 — — 49 — 49

Repurchase of ordinary shares ( 2 ) — ( 124 ) — — ( 124 ) — ( 124 )

Stock-based compensation — — 85 — — 85 — 85

January 26, 2024 1,330 $ — $ 24,589 $ 30,661 $ ( 3,459 ) $ 51,792 $ 204 $ 51,996

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

1 unchanged sentence

Consolidated Statements of Cash Flows

Nine months ended

(in millions) January 24, 2025 January 26, 2024

Three months ended

(in millions) July 25, 2025 July 26, 2024

Operating Activities:

13 unchanged sentences

Investing Activities:

Acquisitions, net of cash acquired ( 98 ) ( 74 )

Additions to property, plant, and equipment ( 504 ) ( 520 )

6 unchanged sentences

Issuance of long-term debt — 3,209

Payments on long-term debt ( 1,162 ) —

Dividends to shareholders ( 910 ) ( 898 )

29 unchanged sentences

The Company’s fiscal years 2026, 2025, and 2024 will end or ended on April 24, 2026, April 25, 2025, and April 26, 2024, respectively.

There have been no material changes to our significant accounting policies, as disclosed in Note 1 included in the Company's Annual Report on Form 10-K for the fiscal year ended April 25, 2025.

In May 2025, the Company announced its intent to separate the Diabetes business, with the intention to create a new independent, publicly traded company.

The separation is expected to be completed within 18 months of the initial announcement.

New Accounting Pronouncements

Recently Adopted Accounting Standards

As of January 24, 2025, there have been no newly adopted accounting pronouncements that materially impact our consolidated financial statements .

For the three months ended July 25, 2025, there have been no newly adopted accounting pronouncements that materially impact our consolidated financial statements.

Refer to the Company's Annual Report on Form 10-K for the fiscal year ended April 25, 2025 for pronouncements recently adopted.

Not Yet Adopted Accounting Standards

Segment Reporting

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, Improvements to Segment Reporting (Topic 280), which requires incremental disclosures on reportable segments, primarily through enhanced disclosures on significant segment expenses.

The Company will adopt this guidance beginning in the fourth quarter of fiscal year 2025 for our annual report and for interim periods starting in fiscal year 2026.

We are currently evaluating the potential effect that the updated standard will have on our financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740), which requires incremental annual disclosures on income taxes, including rate reconciliations, income taxes paid, and other disclosures.

9 unchanged sentences

The Company's primary customers include healthcare systems, clinics, third-party healthcare providers, distributors, and other institutions, including governmental healthcare programs and group purchasing organizations.

Certain prior period net sales have been recast to conform to the new operating segment structure in the fourth quarter of fiscal year 2024.

Refer to Note 17 to the consolidated financial statements for additional information regarding the Company's reporting structure.

In addition, starting in the first quarter of fiscal year 2025, the Company combined the non-U.S.

developed markets and the emerging markets into an international market geography.

Prior period net sales have been recast to conform to the new presentation.

The table below illustrates net sales by segment and division and by market geography for the three and nine months ended January 24, 2025 and January 26, 2024.

The table below illustrates net sales by segment and division and by market geography for the three months ended July 25, 2025 and July 26, 2024.

revenue includes United States and U.S.

1 unchanged sentence

Three months ended

Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

(in millions) July 25, 2025 July 26, 2024

Cardiac Rhythm & Heart Failure $ 1,712 $ 1,535

12 unchanged sentences

Other operating segment (1)

32 53 106 164

Other adjustments (2)

Total net sales $ 8,578 $ 7,915

International U.S.

International

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Three months ended

(in millions) July 25, 2025 July 26, 2024 July 25, 2025 July 26, 2024

Cardiovascular $ 1,479 $ 1,403 $ 1,806 $ 1,604

4 unchanged sentences

Other operating segment (1)

15 20 17 34 51 65 55 99

Other adjustments (2)

1 unchanged sentence

Total net sales $ 4,224 $ 4,082 $ 4,354 $ 3,832

(1) Includes the historical operations and ongoing transition agreements from businesses the Company has exited or divested.

(2) Incremental Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court of Italy relating to certain prior years since 2015.

(1) Includes operations and ongoing transition agreements from businesses the Company has exited or divested.

(2) Reflects adjustments to the Company's Italian payback accruals as further described below.

The amount of revenue recognized is reduced by sales rebates, distributor chargebacks, and returns.

Adjustments to rebates, distributor chargebacks, and returns reserves are recorded as increases or decreases to revenue.

At July 25, 2025, $ 952 million of rebates were

Medtronic plc

Notes to Consolidated Financial Statements

The amount of revenue recognized is reduced by sales rebates and returns.

Adjustments to rebates and returns reserves are recorded as increases or decreases to revenue.

At January 24, 2025, $ 1.0 billion of rebates were classified as other accrued expenses , and $ 625 million of rebates were classified as a reduction of accounts receivable in the consolidated balance sheet.

At April 26, 2024, $ 1.0 billion of rebates were classified as other accrued expenses, and $ 574 million of rebates were classified as a reduction of accounts receivable in the consolidated balance sheet.

classified as other accrued expenses, and $ 683 million of distributor chargebacks were classified as a reduction of accounts receivable in the consolidated balance sheet.

At April 25, 2025, $ 983 million of rebates were classified as other accrued expenses, and $ 680 million of distributor chargebacks were classified as a reduction of accounts receivable in the consolidated balance sheet.

During the three months ended July 26, 2024, the Company recognized $ 90 million of incremental Italian payback accruals resulting from the July 22, 2024 rulings by the Constitutional Court of Italy relating to certain prior years since 2015.

During the three months ended July 25, 2025, the Company decreased its accrual for the Italian payback by $ 39 million resulting from the June 30, 2025 legislative decree published by the Italian government and formalized into law in August 2025 confirming a reduction of the amounts due for years 2015 to 2018.

The changes in estimates related to the Italian payback accruals were recognized as adjustments to net sales in the consolidated statements of income.

Refer to Note 16 for additional information.

Other adjustments to variable consideration during the three months ended July 25, 2025 and July 26, 2024 were not material.

Deferred Revenue and Remaining Performance Obligations

Deferred revenue at January 24, 2025 and April 26, 2024 was $ 462 million and $ 453 million, respectively.

At January 24, 2025 and April 26, 2024, $ 369 million and $ 352 million was included in other accrued expenses, respectively, and $ 93 million and $ 101 million was included in other liabilities, respectively.

During the nine months ended January 24, 2025, the Company recognized $ 251 million of revenue that was included in deferred revenue as of April 26, 2024.

During the nine months ended January 26, 2024, the Company recognized $ 274 million of revenue that was included in deferred revenue as of April 28, 2023.

Deferred revenue at July 25, 2025 and April 25, 2025 was $ 442 million and $ 446 million, respectively.

At July 25, 2025 and April 25, 2025, $ 352 million and $ 354 million was included in other accrued expenses, respectively, and $ 91 million and $ 92 million was included in other liabilities, respectively.

During the three months ended July 25, 2025, the Company recognized $ 135 million of revenue that was included in deferred revenue as of April 25, 2025.

During the three months ended July 26, 2024, the Company recognized $ 108 million of revenue that was included in deferred revenue as of April 26, 2024.

Remaining performance obligations include goods and services that have not yet been delivered or provided under existing, noncancellable contracts with minimum purchase commitments.

At January 24, 2025, the estimated revenue expected to be recognized in future periods related to unsatisfied performance obligations for executed contracts with an original duration of one year or more was approximately $ 0.4 billion.

At July 25, 2025, the estimated revenue expected to be recognized in future periods related to unsatisfied performance obligations for executed contracts with an original duration of one year or more was approximately $ 0.4 billion.

The Company expects to recognize revenue on the majority of these remaining performance obligations over the next three years .

Acquisitions and Dispositions

Acquisitions, Dispositions, and Funded Research and Development Arrangements

Acquisition Activity

During the three and nine months ended January 24, 2025 and the fiscal year ended April 26, 2024, the Company had acquisitions that were accounted for as business combinations.

The assets and liabilities of the businesses acquired were recorded and consolidated on the acquisition date at their respective fair values.

Goodwill resulting from business combinations is largely attributable to future, yet to be defined technologies, new customer relationships, existing workforce of the acquired businesses, and synergies expected to arise after the Company's acquisition of these businesses.

The results of operations of acquired businesses have been included in the Company's consolidated statements of income since the date each business was acquired.

The results of operations of acquired businesses and the pro forma impact of the acquisitions were not significant, either individually or in the aggregate, to the consolidated results of the Company for the three and nine months ended January 24, 2025 and the fiscal year ended April 26, 2024.

For the three and nine months ended January 24, 2025 and the fiscal year ended April 26, 2024, purchase price allocation adjustments were not significant.

During the three months ended July 25, 2025, the Company had no acquisitions that were accounted for as business combinations.

During the fiscal year ended April 25, 2025 the Company had acquisitions that were accounted for as business combinations.

For the three months ended July 25, 2025 and the fiscal year ended April 25, 2025, purchase price allocation adjustments were not significant.

Fiscal Year 2025

The acquisition date fair value of net assets acquired during the three months ended January 24, 2025 was $ 128 million.

Based on preliminary valuations, assets acquired were primarily comprised of $ 108 million of goodwill and $ 50 million of IPR&D.

The acquisition date fair value of net assets acquired during fiscal year 2025 was $ 128 million, consisting of $ 159 million of assets acquired and $ 31 million of liabilities assumed.

Assets acquired were primarily comprised of $ 108 million of goodwill and $ 50 million of IPR&D.

The goodwill is not deductible for tax purposes.

The Company recognized $ 20 million of non-cash contingent consideration liabilities in connection with the business combination during the three months ended January 24, 2025, which comprised of other milestone-based payments.

Fiscal year 2024

The acquisition date fair value of net assets acquired during the fiscal year ended April 26, 2024 was $ 335 million.

Based on preliminary valuations, assets acquired were primarily comprised of $ 131 million of goodwill, $ 150 million of IPR&D, and $ 29 million of technology-based intangible assets with estimated useful lives of 10 years.

For tax purposes, $ 51 million of goodwill is deductible while $ 80 million is not deductible.

The IPR&D was placed into service as a definite-lived intangible asset during the second quarter of fiscal year 2025.

The Company recognized $ 30 million of non-cash contingent consideration liabilities in connection with these business combinations during the fiscal year ended April 26, 2024, which are comprised of revenue and product development milestone-based payments.

Contingent Consideration

Certain of the Company’s business combinations involve potential payment of future consideration that is contingent upon the achievement of certain product development milestones and/or contingent on the acquired business reaching certain performance milestones.

A liability is recorded for the estimated fair value of the contingent consideration on the acquisition date.

The fair value of the contingent consideration is remeasured at each reporting period, and the change in fair value is recognized within other operating (income) expense, net in the consolidated statements of income.

The fair value of contingent consideration liabilities at January 24, 2025 and April 26, 2024 was $ 85 million and $ 149 million, respectively.

At January 24, 2025, $ 34 million was recorded in other accrued expenses , and $ 51 million was recorded in other liabilities in the consolidated balance sheet.

At April 26, 2024, $ 96 million was recorded in other accrued expenses , and $ 53 million was recorded in other liabilities in the consolidated balance sheet.

Medtronic plc

Notes to Consolidated Financial Statements

The following table provides a reconciliation of the beginning and ending balances of contingent consideration liabilities:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Beginning balance $ 124 $ 220 $ 149 $ 206

Purchase price contingent consideration 20 — 20 25

Payments ( 69 ) ( 69 ) ( 83 ) ( 72 )

Change in fair value 10 21 ( 1 ) 14

Ending balance $ 85 $ 172 $ 85 $ 172

The recurring Level 3 fair value measurements of contingent consideration for which a liability is recorded include the following significant unobservable inputs:

Fair Value at

(in millions) January 24, 2025 Unobservable Input Range Weighted Average (1)

Revenue and other performance-based payments $ 56 Discount rate 16.5 % - 28.2 %

Projected fiscal year of payment 2025 - 2029 2027

Product development and other milestone-based payments $ 30 Discount rate 5.5 %

Projected fiscal year of payment 2025 - 2028 2027

(1) Unobservable inputs were weighted by the relative fair value of the contingent consideration liability.

For projected fiscal year of payment, the amount represents the median of the inputs and is not a weighted average.

On April 1, 2023, the Company and DaVita Inc.

(“DaVita”) completed the transaction for the Company to sell half of its Renal Care Solutions (RCS) business.

In connection with the sale, the Company may be entitled to receive additional consideration based on the achievement of certain revenue, regulatory, and profitability milestones, with potential payouts starting in fiscal year 2026 through 2029.

The fair value of the contingent consideration receivable at January 24, 2025 and April 26, 2024 was $ 61 million and $ 58 million, and was recorded in other assets in the consolidated balance sheet.

The following table provides a reconciliation of the beginning and ending balances of the Level 3 measurement of contingent consideration receivable:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Beginning balance $ 61 $ 152 $ 58 $ 195

Change in fair value — ( 2 ) 3 ( 45 )

Ending balance $ 61 $ 150 $ 61 $ 150

Restructuring and Other Costs

Restructuring and associated costs for the three and nine months ended January 24, 2025 were $ 46 million and $ 154 million, respectively, as compared to $ 55 million and $ 237 million for the three and nine months ended January 26, 2024, respectively.

Restructuring and associated costs primarily related to employee termination benefits and facility consolidations to support cost reduction initiatives.

Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated.

Associated and other costs primarily include salaries and wages of employees that are fully-dedicated to restructuring activities, consulting expenses, and asset write-offs.

The Company recognized $ 20 million of non-cash contingent consideration liabilities in connection with these business combinations during fiscal year 2025, which were comprised of other milestone-based payments.

Funded Research and Development Arrangements

The Company has entered into various arrangements with affiliates of Blackstone Life Sciences Advisors L.L.C.

(collectively, "Blackstone") to receive funding related to the development of certain products within the Cardiovascular Portfolio and Diabetes Operating Unit.

As there is substantive and genuine transfer of risk to Blackstone, the development funding is recognized by Medtronic as an obligation to perform contractual services.

The Company recognizes the funding as income within other operating expense, net as the research and development costs are incurred and funding payments become due.

Under these arrangements, the Company recognized income of $ 36 million and $ 38 million during the three months ended July 25, 2025 and July 26, 2024, respectively.

As of July 25, 2025, the Company is eligible to receive additional funding of $ 355 million under these arrangements.

Following potential U.S.

regulatory approval and commercial launch of each product covered by the Blackstone agreements, Blackstone will earn a combination of fixed regulatory and commercial milestone payments up to $ 1.2 billion and royalties based on percent of sales of such products.

Under certain termination provisions, the Company's payment obligation will survive, and in certain termination circumstances, a payment to Blackstone of a multiple of the funded amounts may be required.

At the time of executing these contracts, the occurrence of such circumstances was deemed to be remote.

Restructuring Charges

Restructuring, associated, and other costs for the three months ended July 25, 2025 and July 26, 2024 were $ 67 million and $ 62 million respectively, which primarily related to employee termination benefits provided to employees who have been involuntarily terminated and facility related and contract termination costs.

Medtronic plc

Notes to Consolidated Financial Statements

The following table presents the classification of restructuring and associated costs in the consolidated statements of income:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

The following table presents the classification of restructuring, associated, and other costs in the consolidated statements of income:

Three months ended

(in millions) July 25, 2025 July 26, 2024

Cost of products sold $ 16 $ 9

1 unchanged sentence

Restructuring charges, net 45 47

Total restructuring and associated costs $ 46 $ 55 $ 154 $ 237

The following table summarizes the activity for the nine months ended January 24, 2025:

Total restructuring, associated, and other costs $ 67 $ 62

The following table summarizes the activity for the three months ended July 25, 2025:

(in millions) Employee Termination Benefits Associated and Other Costs Total

5 unchanged sentences

( 7 ) — ( 7 )

January 24, 2025 $ 61 $ 2 $ 63

July 25, 2025 $ 107 $ 12 $ 119

(1) Accrual adjustments primarily relate to certain employees identified for termination finding other positions within the Company.

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The Company holds investments in marketable debt securities that are classified and accounted for as available-for-sale and are remeasured on a recurring basis.

The following tables summarize the Company's investments in available-for-sale debt securities by significant investment category and the related consolidated balance sheet classification at January 24, 2025 and April 26, 2024:

January 24, 2025

July 25, 2025

Valuation Balance Sheet Classification

28 unchanged sentences

Notes to Consolidated Financial Statements

The following tables present the gross unrealized losses and fair values of the Company’s available-for-sale debt securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category at January 24, 2025 and April 26, 2024:

January 24, 2025

July 25, 2025

Less than 12 months More than 12 months

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Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.

There were no transfers into or out of Level 3 during the three and nine months ended January 24, 2025 and January 26, 2024.

There were no transfers into or out of Level 3 during the three months ended July 25, 2025 and July 26, 2024.

When a determination is made to classify an asset or liability within Level 3, the determination is based upon the significance of the unobservable inputs to the overall fair value measurement.

Activity related to the Company’s available-for-sale debt securities portfolio is as follows:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Proceeds from sales $ 1,890 $ 1,794 $ 6,134 $ 5,114

Gross realized gains 5 7 19 18

Gross realized losses ( 3 ) ( 6 ) ( 16 ) ( 22 )

The contractual maturities of available-for-sale debt securities at January 24, 2025 is shown in the following table.

Gains and losses on available-for-sale debt securities are recognized in other non-operating income , net in the consolidated statements of income.

During the three months ended July 25, 2025 and July 26, 2024, gross realized gains and losses on available-for-sale debt securities were not significant.

During the three months ended July 25, 2025 and July 26, 2024, proceeds from sales of available-for-sale debt securities were $ 2.0 billion and $ 2.2 billion, respectively.

The contractual maturities of available-for-sale debt securities at July 25, 2025 are shown in the following table.

Within the table, maturities of mortgage-backed securities have been allocated based upon timing of estimated cash flows assuming no change in the current interest rate environment.

6 unchanged sentences

Total $ 6,911 $ 6,860

Interest income, which includes income on marketable debt securities and the global liquidity structure, is recognized in other non-operating income, net , in the consolidated statements of income.

During the three and nine months ended January 24, 2025, there were $ 114 million and $ 364 million of interest income, respectively.

During the three and nine months ended January 26, 2024, there was $ 170 million and $ 429 million of interest income, respectively.

Interest income, which includes income on marketable debt securities and the global liquidity structures, is recognized in other non-operating income, net , in the consolidated statements of income.

During the three months ended July 25, 2025 and July 26, 2024, there was $ 120 million and $ 112 million, respectively, of interest income.

Medtronic plc

1 unchanged sentence

Equity Securities, Equity Method Investments, and Other Investments

The Company holds investments in equity securities with readily determinable fair values, equity method investments for which the Company has elected the fair value option, equity investments without readily determinable fair values, investments accounted for under the equity method, and other investments.

Equity securities with readily determinable fair values are included in Level 1 of the fair value hierarchy, as they are measured using quoted market prices.

Equity method investments for which the Company has elected the fair value option are included within Level 3 of the fair value hierarchy due to the use of significant unobservable inputs to determine fair value.

To determine the fair value of these investments, the Company uses a discounted cash flow methodology, taking into consideration various assumptions including discount rate, and all pertinent financial information available related to the investees, including the timing of anticipated product launches, historical financial results, and projections of future cash flows.

Equity investments that do not have readily determinable fair values, and that are not accounted for via the fair value option, are included within Level 3 of the fair value hierarchy, as they are measured using the measurement alternative at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

The following table summarizes the Company's equity and other investments at January 24, 2025 and April 26, 2024, which are classified as primarily other assets in the consolidated balance sheets:

(in millions) January 24, 2025 April 26, 2024

The following table summarizes the Company's equity and other investments at July 25, 2025 and April 25, 2025, which are classified as primarily other assets in the consolidated balance sheets:

(in millions) July 25, 2025 April 25, 2025

Investments with readily determinable fair value (marketable equity securities) $ 20 $ 17

3 unchanged sentences

Total equity and other investments $ 850 $ 951

The table below includes activity related to the Company's portfolio of equity and other investments.

Gains and losses on equity and other investments are recognized in other non-operating income , net in the consolidated statements of income.

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Proceeds from sales $ 27 $ 12 $ 120 $ 28

Gross gains 8 33 100 31

Gross losses ( 4 ) ( 38 ) ( 17 ) ( 111 )

Impairment losses recognized ( 71 ) — ( 116 ) ( 21 )

During the three and nine months ended January 24, 2025, there were $ 2 million of net unrealized losses and $ 5 million of net unrealized gains, respectively, on equity securities and other investments still held at January 24, 2025.

During the three and nine months ended January 26, 2024, there were $ 25 million and $ 95 million of net unrealized losses, respectively, on equity securities and other investments still held at January 26, 2024.

During the three months ended July 25, 2025, there were $ 87 million of net unrealized losses on equity securities and other investments still held at July 25, 2025.

During the three months ended July 26, 2024, there were $ 17 million of net unrealized gains on equity securities and other investments still held at July 26, 2024.

Mozarc Medical Investment

As further described in Note 4, on April 1, 2023, the Company sold half of its RCS business to Mozarc, and as a result of the transaction the Company retained a 50 percent equity interest in Mozarc.

In May 2022, the Company and DaVita Inc.

(DaVita) entered into a definitive agreement for the Company to sell half of its RCS business, and in April 2023, completed the transaction.

This sale was part of an agreement between Medtronic and DaVita to form a new, independent kidney care-focused medical device company (“Mozarc Medical” or "Mozarc") with equal equity ownership.

At closing, the Company retained a 50 % non-controlling equity interest in Mozarc valued at $ 307 million.

Although the equity investment provides the Company with the ability to exercise significant influence over Mozarc, the Company has elected the fair value option to account for this equity investment.

1 unchanged sentence

Under the fair value option, changes in the fair value of the investment are recognized through earnings each reporting period in other non-operating income, net in the consolidated statements of income.

During the three and nine months ended January 24, 2025, the change in fair value was not significant.

During the three and nine months ended January 26, 2024, the Company recognized a loss of $ 39 million.

Medtronic plc

Notes to Consolidated Financial Statements

During the three months ended July 25, 2025, the Company recognized a loss of $ 90 million primarily driven by historical financial results and projections of future cash flows.

During the three months ended July 26, 2024, the change in fair value was not significant.

The following table provides a reconciliation of the beginning and ending balances of the Mozarc investment for which the fair value option has been elected:

Three months ended

(in millions) July 25, 2025 July 26, 2024

Beginning Balance $ 140 $ 311

Change in fair value ( 90 ) —

Ending Balance $ 50 $ 311

Financing Arrangements

3 unchanged sentences

The aggregate amount outstanding at any time under the commercial paper programs may not exceed the equivalent of $ 3.5 billion.

There was no commercial paper outstanding at January 24, 2025.

During the three and nine months ended January 24, 2025, the commercial paper outstanding had a weighted average original maturity of 13 days and 14 days, respectively, and a weighted average interest rate of 4.66 percent and 5.12 percent, respectively.

Commercial paper outstanding at April 26, 2024 was $ 1.1 billion.

There was $ 649 million of commercial paper outstanding at July 25, 2025.

During the three months ended July 25, 2025, the commercial paper outstanding had a weighted average original maturity of 13 days and a weighted average interest rate of 4.43 percent.

There was no commercial paper outstanding at April 25, 2025.

During fiscal year 2025, the weighted average original maturity of the commercial paper outstanding was approximately 13 days and the weighted average interest rate was 5.02 percent.

3 unchanged sentences

The Credit Facility includes a multi-currency borrowing feature for certain specified foreign currencies.

At January 24, 2025 and April 26, 2024, no amounts were outstanding under the Credit Facility.

At July 25, 2025 and April 25, 2025, no amounts were outstanding under the Credit Facility.

Medtronic plc

Notes to Consolidated Financial Statements

Interest rates on advances on the Credit Facility are determined by a pricing matrix, based on the Company’s long-term debt ratings, assigned by Standard & Poor’s Ratings Services and Moody’s Investors Service.

1 unchanged sentence

The Company is in compliance with the covenants under the Credit Facility.

Medtronic plc

Notes to Consolidated Financial Statements

Debt Obligations

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(in millions) Maturity by

Fiscal Year January 24, 2025 April 26, 2024

Fiscal Year July 25, 2025 April 25, 2025

Current debt obligations 2026 - 2027 $ 2,430 $ 2,874

Long-term debt

0.250 percent six -year 2019 senior notes

2.625 percent three -year 2022 senior notes

0.000 percent five -year 2020 senior notes

1.125 percent eight -year 2019 senior notes

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Finance lease obligations 2027 - 2040 51 52

Deferred financing costs 2027 - 2054 ( 121 ) ( 110 )

Debt discount, net 2027 - 2054 ( 61 ) ( 59 )

Deferred financing costs 2027 - 2054 ( 113 ) ( 117 )

Total long-term debt $ 26,179 $ 25,642

Interest expense on outstanding borrowings, including amortization of debt issuance costs and debt discounts and premiums, and the global liquidity structure is recognized in interest expense, net in the consolidated statements of income.

During the three and nine months ended January 24, 2025, there was $ 224 million and $ 693 million, respectively, of interest expense on outstanding borrowings, including amortization of debt issuance costs and debt discounts and premiums, and the global liquidity structure.

During the three and nine months ended January 26, 2024, there was $ 237 million and $ 664 million, respectively, of interest expense on outstanding borrowings, including

Interest expense on outstanding borrowings, including amortization of debt issuance costs and debt discounts and premiums, and the global liquidity structures is recognized in interest expense, net in the consolidated statements of income.

During the three months ended July 25, 2025 and July 26, 2024, there was $ 217 million of interest expense on outstanding borrowings, including amortization of debt issuance costs and debt discounts and premiums, and the global liquidity structures.

Medtronic plc

Notes to Consolidated Financial Statements

amortization of debt issuance costs and debt discounts and premiums, and the global liquidity structure.

The Company has outstanding unsecured senior obligations, described as senior notes in the tables above (collectively, the Senior Notes).

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The Company is in compliance with all covenants related to the Senior Notes.

On June 3, 2024, Medtronic Inc.

issued four tranches of EUR-denominated Senior Notes with an aggregate principal of € 3.0 billion, with maturities ranging from fiscal year 2030 to 2054, resulting in cash proceeds of approximately $ 3.2 billion, net of discounts and issuance costs.

In June 2024, Medtronic Inc.

issued four tranches of Euro-denominated Senior Notes with an aggregate principal of € 3.0 billion, with maturities ranging from fiscal year 2030 to 2054, resulting in cash proceeds of approximately $ 3.2 billion, net of discounts and issuance costs.

In anticipation of the Euro-denominated debt issuance, the Company entered into forward currency exchange rate contracts to manage the exposure to exchange rate movements.

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Financial Instruments Not Measured at Fair Value

At January 24, 2025, the estimated fair value of the Company’s Senior Notes was $ 24.4 billion compared to a principal value of $ 26.7 billion.

At July 25, 2025, the estimated fair value of the Company’s Senior Notes was $ 25.6 billion compared to a principal value of $ 28.1 billion.

At April 25, 2025, the estimated fair value was $ 26.2 billion compared to a principal value of $ 28.6 billion.

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Fair Value Hedges

Beginning in the first quarter of fiscal year 2025, the Company began using foreign currency forward contracts designated as fair value hedges to manage its exposure to changes in the fair value of its fixed-rate debt obligation.

In fiscal year 2025, the Company began using foreign currency forward contracts designated as fair value hedges to manage its exposure to changes in the fair value of a fixed-rate debt obligation.

The contracts matured during the first quarter of fiscal year 2026.

At inception, foreign currency forward contracts are designated as fair value hedges.

Changes in the fair value of these derivatives are reported as a component of other operating (income) expense, net .

Amounts excluded from the assessment of effectiveness are recognized in interest expense, net on a straight-line basis over the term of the hedge.

During the three and nine months ended January 24, 2025, amounts related to excluded components that are amortized in interest expense, net over the life of the hedging instrument were not significant.

Changes in the fair value of these derivatives are reported as a component of other operating expense, net .

Amounts excluded from the assessment of effectiveness are recognized in interest expense, net on a straight-line basis over the term of the hedge and were not significant for the three months ended July 25, 2025 and July 26, 2024.

Cash flows related to the Company's derivative instruments designated as fair value hedges are reported as financing activities in the consolidated statements of cash flows.

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Cash flows are reported as operating activities in the consolidated statements of cash flows.

The Company's cash flow hedges will mature within the subsequent three-year period.

At January 24, 2025 and April 26, 2024, the Company had $ 432 million and $ 229 million in after-tax unrealized gains, respectively, associated with cash flow hedging instruments recorded in accumulated other comprehensive loss .

The Company expects that $ 289 million of after-tax net unrealized gains at January 24, 2025 will be recognized in the consolidated statements of income over the next 12 months.

The Company's cash flow hedges will mature within the subsequent two-year period.

At July 25, 2025 and April 25, 2025, the Company had $ 276 million and $ 149 million in after-tax unrealized losses, respectively, associated with cash flow hedging instruments recorded in accumulated other comprehensive loss .

The Company expects that $ 154 million of after-tax net unrealized losses at July 25, 2025 will be recognized in the consolidated statements of income over the next 12 months.

Net Investment Hedges

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The gains or losses are reclassified into earnings upon a liquidation event or deconsolidation of the foreign subsidiary.

Medtronic plc

Notes to Consolidated Financial Statements

Amounts excluded from the assessment of effectiveness are recognized in interest expense, net on a straight-line basis over the term of the hedge.

During the three and nine months ended January 24, 2025, the Company recognized $ 50 million and $ 148 million, respectively, in after-tax unrealized gains representing excluded components in interest expense, net .

During the three and nine months ended January 26, 2024, the Company recognized $ 49 million and $ 148 million, respectively, in after-tax unrealized gains representing excluded components in interest expense, net .

During the three months ended July 25, 2025 and July 26, 2024, the Company recognized $ 45 million and $ 50 million, respectively, of after-tax unrealized gains representing excluded components in interest expense, net .

The cash flows related to the Company's derivative instruments designated as net investment hedges are reported as investing activities in the consolidated statements of cash flows.

Cash flows attributable to amounts excluded from the assessment of effectiveness are reported as operating activities in the consolidated statements of cash flows.

Medtronic plc

Notes to Consolidated Financial Statements

attributable to amounts excluded from the assessment of effectiveness are reported as operating activities in the consolidated statements of cash flows.

Undesignated Derivatives

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The following table presents the contractual amounts of the Company's outstanding instruments:

(in billions) Designation January 24, 2025 April 26, 2024

Currency exchange rate contracts (1)

Fair value hedge $ 1.0 $ —

(in billions) Designation July 25, 2025 April 25, 2025

Currency exchange rate contracts Fair value hedge $ — $ 1.1

Currency exchange rate contracts Cash flow hedge 10.4 10.6

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Currency exchange rate contracts Undesignated 4.2 3.9

(1) At January 24, 2025, includes derivative contracts with a notional value of € 1.0 billion, or $ 1.0 billion, designated as hedges of a portion of our fixed-rate debt obligations.

(2) At January 24, 2025, includes derivative contracts with a notional value of € 6.0 billion, or $ 6.3 billion, designated as hedges of a portion of our net investment in certain European operations and derivative contracts with a notional value of ¥ 322.2 billion, or $ 2.1 billion, designated as hedges of a portion of our net investment in certain Japanese operations.

(1) At July 25, 2025, includes derivative contracts with a notional value of € 4.0 billion, or $ 4.7 billion, designated as hedges of a portion of our net investment in certain European operations and derivative contracts with a notional value of ¥ 286 billion, or $ 2.0 billion, designated as hedges of a portion of our net investment in certain Japanese operations.

These derivative contracts mature in fiscal years 2027 through 2033.

(3) At January 24, 2025, includes € 18.0 billion, or $ 18.8 billion, of outstanding Euro-denominated debt designated as hedges of a portion of our net investment in foreign operations.

(2) At July 25, 2025, includes € 18.0 billion, or $ 21.1 billion, of outstanding Euro-denominated debt designated as hedges of a portion of our net investment in foreign operations.

This debt matures in fiscal years 2026 through 2054.

Medtronic plc

Notes to Consolidated Financial Statements

Gains and Losses on Hedging Instruments and Derivatives not Designated as Hedging Instruments

The amount of the gains and losses on hedging instruments and the classification of those gains and losses within our consolidated financial statements for the three and nine months ended January 24, 2025 and January 26, 2024 were as follows:

The amount of the gains and losses on hedging instruments and the classification of those gains and losses within our consolidated financial statements for the three months ended July 25, 2025 and July 26, 2024 were as follows:

(Gain) Loss Recognized in Accumulated Other Comprehensive Loss (Gain) Loss Reclassified into Income

Three months ended Nine months ended Three months ended Nine months ended Location of (Gain) Loss in Income Statement

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Three months ended Three months ended Location of (Gain) Loss in Income Statement

(in millions) July 25, 2025 July 26, 2024 July 25, 2025 July 26, 2024

Fair value hedges

Currency exchange rate contracts $ — $ — $ ( 1 ) $ — $ 38 $ — $ 42 $ — Other operating (income) expense, net

Currency exchange rate contracts $ 1 $ — $ ( 20 ) $ ( 1 ) Other operating expense, net

Cash flow hedges

Currency exchange rate contracts ( 346 ) 136 ( 303 ) ( 263 ) ( 49 ) ( 83 ) ( 88 ) ( 209 ) Other operating (income) expense, net

Currency exchange rate contracts 97 43 20 ( 36 ) Other operating expense, net

Currency exchange rate contracts 38 ( 20 ) ( 19 ) ( 17 ) Cost of products sold

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Total $ 717 $ 229 $ ( 18 ) $ ( 55 )

The amount of the gains and losses on our derivative instruments not designated as hedging instruments and the classification of those gains and losses within our consolidated financial statements during the three and nine months ended January 24, 2025 and January 26, 2024 were as follows:

Medtronic plc

Notes to Consolidated Financial Statements

The amount of the gains and losses on our derivative instruments not designated as hedging instruments and the classification of those gains and losses within our consolidated financial statements during the three months ended July 25, 2025 and July 26, 2024 were as follows:

(Gain) Loss Recognized in Income

Three months ended Nine months ended Location of (Gain) Loss in Income Statement

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Currency exchange rate contracts $ 65 $ ( 9 ) $ 60 $ 83 Other operating (income) expense, net

Three months ended Location of (Gain) Loss in Income Statement

(in millions) July 25, 2025 July 26, 2024

Currency exchange rate contracts $ ( 2 ) $ ( 8 ) Other operating expense, net

Balance Sheet Presentation

The following table summarizes the balance sheet classification and fair value of derivative instruments included in the consolidated balance sheets at January 24, 2025 and April 26, 2024.

The following table summarizes the balance sheet classification and fair value of derivative instruments included in the consolidated balance sheets at July 25, 2025 and April 25, 2025.

The fair value amounts are presented on a gross basis, and are segregated between derivatives that are designated and qualify as hedging instruments and those that are not designated and do not qualify as hedging instruments, and are further segregated by type of contract within those two categories.

Fair Value - Assets Fair Value - Liabilities

(in millions) January 24, 2025 April 26, 2024 Balance Sheet Classification January 24, 2025 April 26, 2024 Balance Sheet Classification

(in millions) July 25, 2025 April 25, 2025 Balance Sheet Classification July 25, 2025 April 25, 2025 Balance Sheet Classification

Derivatives designated as hedging instruments

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Total derivatives $ 335 $ 334 $ 523 $ 417

Medtronic plc

Notes to Consolidated Financial Statements

The following table provides information by level for the derivative assets and liabilities that are measured at fair value on a recurring basis.

January 24, 2025 April 26, 2024

July 25, 2025 April 25, 2025

(in millions) Derivative Assets Derivative Liabilities Derivative Assets Derivative Liabilities

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The cash flows related to collateral posted and received are reported gross as investing and financing activities, respectively, in the consolidated statements of cash flows.

Medtronic plc

Notes to Consolidated Financial Statements

The following tables provide information as if the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria as stipulated by the terms of the master netting arrangements with each of the counterparties.

Derivatives not subject to master netting arrangements are not eligible for net presentation.

January 24, 2025

July 25, 2025

Gross Amount Not Offset on the Balance Sheet

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Currency exchange rate contracts ( 401 ) 195 125 ( 82 )

Total return swaps ( 16 ) — — ( 16 )

( 417 ) 195 125 ( 97 )

Total $ ( 84 ) $ — $ 125 $ 42

Inventory balances were as follows:

(in millions) January 24, 2025 April 26, 2024

(in millions) July 25, 2025 April 25, 2025

Finished goods $ 4,022 $ 3,779

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Total $ 5,886 $ 5,476

Medtronic plc

Notes to Consolidated Financial Statements

Goodwill and Other Intangible Assets

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April 25, 2025 $ 8,017 $ 11,716 $ 19,748 $ 2,255 $ 41,737

Goodwill as a result of acquisitions — — 108 — 108

Purchase accounting adjustments 2 — — — 2

Currency translation and other ( 38 ) ( 34 ) ( 204 ) — ( 277 )

January 24, 2025 $ 7,929 $ 11,611 $ 19,025 $ 2,254 $ 40,819

As further described in Note 17, the Company had changes to the operating segments and goodwill reporting units during the fourth quarter of fiscal year 2024.

For further information on the reporting unit changes, refer to Note 9 to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended April 26, 2024.

The Company assesses goodwill for impairment annually as of the first day of the third quarter of the fiscal year and whenever an event occurs or circumstances change that would indicate that the carrying amount may be impaired.

Impairment testing for goodwill is performed at the reporting unit level.

The Company calculates the excess of each reporting unit's fair value over its carrying amount, including goodwill, utilizing a discounted cash flow analysis and revenue and earnings multiples using comparable public company information.

Significant assumptions used in reporting unit fair value measurements include forecasted cash flows, including revenue and expense growth rates, discount rates, and revenue and earnings multiples.

An impairment loss is recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit.

A change in any of these estimates and assumptions could produce a different fair value, which could have a material impact on the Company's results of operations.

No goodwill impairment was recognized during the three and nine months ended January 24, 2025 and January 26, 2024.

Currency translation 28 38 203 — 269

July 25, 2025 $ 8,045 $ 11,754 $ 19,952 $ 2,255 $ 42,007

No goodwill impairment was recognized during the three months ended July 25, 2025 and July 26, 2024.

Medtronic plc

Notes to Consolidated Financial Statements

The following table presents the gross carrying amount and accumulated amortization of intangible assets:

January 24, 2025 April 26, 2024

July 25, 2025 April 25, 2025

(in millions) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization

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IPR&D $ 290 $ — $ 289 $ —

The Company did not recognize any definite-lived intangible asset impairment charges during the three and nine months ended January 24, 2025 and January 26, 2024.

The Company did not recognize any indefinite-lived intangible asset impairment charges during the three months ended January 24, 2025 and January 26, 2024, and during the nine months ended January 24, 2025.

Indefinite-lived intangible asset impairment charges were not significant for the nine months ended January 26, 2024.

The Company did not recognize any definite-lived or indefinite-lived intangible asset impairment charges during the three months ended July 25, 2025 and July 26, 2024.

Due to the nature of IPR&D projects, the Company may experience future delays or failures to obtain regulatory approvals to conduct clinical trials, failures of clinical trials, delays or failures to obtain required market clearances, other failures to achieve a commercially viable product, or the discontinuation of certain projects, and as a result, may recognize impairment losses in the future.

Medtronic plc

Notes to Consolidated Financial Statements

Amortization Expense

Intangible asset amortization expense for the three months ended January 24, 2025 and January 26, 2024 was $ 416 million and $ 419 million, respectively.

Intangible asset amortization expense for the nine months ended January 24, 2025 and January 26, 2024 was $ 1.2 billion and $ 1.3 billion, respectively.

Estimated aggregate amortization expense by fiscal year based on the carrying value of definite-lived intangible assets at January 24, 2025, excluding any possible future amortization associated with acquired IPR&D which has not yet met technological feasibility, is as follows:

Intangible asset amortization expense for the three months ended July 25, 2025 was $ 459 million, including $ 45 million of accelerated amortization on certain intangible assets within the Cardiovascular Portfolio.

Intangible asset amortization expense for the three months ended July 26, 2024 was $ 414 million.

Estimated aggregate amortization expense by fiscal year based on the carrying value of definite-lived intangible assets at July 25, 2025, excluding any possible future amortization associated with acquired IPR&D which has not yet met technological feasibility, is as follows:

(in millions) Amortization Expense

Remaining 2026 $ 1,303

On July 4, 2025, the U.S.

Government enacted The One Big Beautiful Bill Act of 2025 which includes, among other provisions, changes to the U.S.

corporate income tax system including the allowance of immediate expensing of qualifying research and development expenses and permanent extensions of certain provisions within the Tax Cuts and Jobs Act.

Certain provisions are effective for the Company beginning fiscal year 2026 and the impact for the three months ended July 25, 2025 was not significant.

The Organization for Economic Co-operation and Development (OECD) published Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15% in each jurisdiction in which the group operates.

The OECD has since issued administrative guidance providing transition and safe harbor rules around the implementation of the Pillar Two global minimum tax.

A number of countries, including Ireland, have enacted legislation to implement the core elements of Pillar Two, which are effective for the Company in fiscal year 2025.

We will continue to monitor the impacts of further legislation, regulatory guidance, and regulations issued in the countries in which we do business.

The Israeli Central-Lod District Court issued its decision in the Medtronic Ventor Technologies Ltd (Ventor) v.

Kfar Saba Assessing Office on June 1, 2023.

The court determined that there was a deemed taxable transfer of intellectual property.

As a result, the Company recorded a $ 187 million income tax charge during the first quarter of fiscal year 2024 and has filed an appeal with the Supreme Court of Israel.

The Company's effective tax rate for the three and nine months ended January 24, 2025 was 15.4 % and 16.9 %, respectively, as compared to 9.2 % and 23.5 % for the three and nine months ended January 26, 2024, respectively.

The increase in the effective tax rate for the three months ended January 24, 2025 primarily relates to a Swiss Cantonal tax rate change on previously recorded deferred tax assets during the three months ended January 26, 2024, and the implementation of the Pillar Two global minimum tax.

The decrease in the effective tax rate for the nine months ended January 24, 2025 was primarily attributable to the establishment of a valuation allowance on certain net operating losses and an income tax reserve adjustment made during the nine months ended January 26, 2024 associated with the Ventor court decision noted above, which was partially offset by the Swiss Cantonal tax rate change on previously recorded deferred tax assets and the implementation of the Pillar Two global minimum tax noted above.

At January 24, 2025 and April 26, 2024, the Company's gross unrecognized tax benefits were $ 2.9 billion and $ 2.8 billion, respectively.

In addition, the Company had accrued gross interest and penalties of $ 63 million at January 24, 2025.

A number of countries, including Ireland, have enacted legislation to implement the core elements of Pillar Two, which were effective for Medtronic in fiscal year 2025.

The Company's effective tax rate for the three months ended July 25, 2025 was 19.6 % as compared to 17.4 % for the three months ended July 26, 2024.

The increase in the effective tax rate for the three months ended July 25, 2025 primarily relates to an increase in the Pillar Two global minimum tax impact and year-over-year changes in operational results by jurisdiction.

At both July 25, 2025 and April 25, 2025, the Company's gross unrecognized tax benefits were $ 2.9 billion.

In addition, the Company had accrued gross interest and penalties of $ 99 million at July 25, 2025.

If all of the Company’s unrecognized tax benefits were recognized, approximately $ 2.7 billion would impact the Company’s effective tax rate.

At January 24, 2025 and April 26, 2024, the amount of the Company's gross unrecognized tax benefits, net of cash advance, recorded as a noncurrent liability within accrued income taxes on the consolidated balance sheets was $ 1.9 billion and $ 1.8 billion, respectively.

At July 25, 2025 and April 25, 2025, the amount of the

Medtronic plc

Notes to Consolidated Financial Statements

Company's gross unrecognized tax benefits, net of cash advance, recorded as a noncurrent liability within accrued income taxes on the consolidated balance sheets was $ 2.0 billion and $ 1.9 billion, respectively.

The Company recognizes interest and penalties related to income tax matters within income tax provision in the consolidated statements of income and records the liability within either current or noncurrent accrued income taxes on the consolidated balance sheets.

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Potentially dilutive ordinary shares include stock-based awards granted under stock-based compensation plans and shares committed to be purchased under the employee stock purchase plan.

Medtronic plc

Notes to Consolidated Financial Statements

The table below sets forth the computation of basic and diluted earnings per share:

Three months ended Nine months ended

(in millions, except per share data) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Three months ended

(in millions, except per share data) July 25, 2025 July 26, 2024

Net income attributable to ordinary shareholders $ 1,040 $ 1,042

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Diluted earnings per share $ 0.81 $ 0.80

The calculation of weighted average diluted shares outstanding excludes options to purchase approximately 26 million and 27 million ordinary shares for the three and nine months ended January 24, 2025, respectively, and 29 million and 28 million ordinary shares for the three and nine months ended January 26, 2024, respectively, because their effect would have been anti-dilutive on the Company’s earnings per share.

The calculation of weighted average diluted shares outstanding excludes stock awards of approximately 24 million and 27 million ordinary shares for the three months ended July 25, 2025 and July 26, 2024, respectively, because their effect would have been anti-dilutive on the Company’s earnings per share.

Medtronic plc

Notes to Consolidated Financial Statements

Stock-Based Compensation

The following table presents the components and classification of stock-based compensation expense for stock options, restricted stock, performance share units, and employee stock purchase plan shares recognized for the three and nine months ended January 24, 2025 and January 26, 2024:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Three months ended

(in millions) July 25, 2025 July 26, 2024

Stock options $ 10 $ 13

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Total stock-based compensation expense, net of tax $ 71 $ 70

Medtronic plc

Notes to Consolidated Financial Statements

Retirement Benefit Plans

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employees and many employees outside the U.S.

The net periodic benefit cost of the defined benefit pension plans included the following components for the three and nine months ended January 24, 2025 and January 26, 2024:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

The net periodic benefit cost of the defined benefit pension plans included the following components for the three months ended July 25, 2025 and July 26, 2024:

Three months ended

(in millions) July 25, 2025 July 26, 2024 July 25, 2025 July 26, 2024

Service cost $ 12 $ 13 $ 11 $ 11

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Amortization of net actuarial loss 5 4 1 —

Net periodic (credit) benefit cost $ ( 7 ) $ ( 6 ) $ 7 $ 5 $ ( 21 ) $ ( 18 ) $ 22 $ 15

Components of net periodic (credit) benefit cost other than the service component are recognized in other non-operating income, net in the consolidated statements of income.

Net periodic benefit (credit) cost $ ( 6 ) $ ( 7 ) $ 6 $ 7

Components of net periodic benefit (credit) cost other than the service component are recognized in other non-operating income, net in the consolidated statements of income.

Medtronic plc

Notes to Consolidated Financial Statements

Accumulated Other Comprehensive Loss

The following table provides changes in accumulated other comprehensive loss (AOCI), net of tax, and by component:

(in millions) Unrealized (Loss) Gain on Investment Securities Cumulative Translation Adjustments Net Investment Hedges Net Change in Retirement Obligations Unrealized Gain (Loss) on Cash Flow Hedges Total Accumulated Other Comprehensive (Loss) Income

(in millions) Unrealized (Loss) Gain on Investment Securities Cumulative Translation Adjustments Net Investment Hedges Net Change in Retirement Obligations Unrealized (Loss) Gain on Cash Flow Hedges Total Accumulated Other Comprehensive (Loss) Income

April 25, 2025 $ ( 63 ) $ ( 2,835 ) $ ( 597 ) $ ( 640 ) $ ( 149 ) $ ( 4,284 )

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Other comprehensive income (loss) 19 348 ( 559 ) 1 ( 128 ) ( 319 )

January 24, 2025 $ ( 102 ) $ ( 4,129 ) $ 1,488 $ ( 527 ) $ 432 $ ( 2,839 )

July 25, 2025 $ ( 44 ) $ ( 2,487 ) $ ( 1,156 ) $ ( 641 ) $ ( 276 ) $ ( 4,604 )

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Other comprehensive income (loss) 76 102 ( 206 ) 1 ( 66 ) ( 92 )

January 26, 2024 $ ( 185 ) $ ( 3,300 ) $ 593 $ ( 735 ) $ 167 $ ( 3,459 )

The income tax on gains and losses on investment securities in other comprehensive income before reclassifications during the nine months ended January 24, 2025 and January 26, 2024, was an expense of $ 19 million and $ 9 million, respectively.

During the nine months ended January 24, 2025 and January 26, 2024, realized gains and losses on investment securities reclassified from AOCI were reduced by income taxes of $ 2 million and $ 4 million, respectively.

July 26, 2024 $ ( 136 ) $ ( 3,584 ) $ 672 $ ( 529 ) $ 165 $ ( 3,410 )

The income tax on gains and losses on investment securities in other comprehensive income before reclassifications during the three months ended July 25, 2025 and July 26, 2024 was an expense of $ 4 million and $ 14 million, respectively.

During the three months ended July 25, 2025 and July 26, 2024, realized gains and losses on investment securities reclassified from AOCI were reduced by an insignificant amount of income taxes.

When realized, gains and losses on investment securities reclassified from AOCI are recognized within other non-operating income, net .

Refer to Note 6 to the consolidated financial statements for additional information.

During the nine months ended January 24, 2025, the income tax on cumulative translation adjustments was a benefit of $ 3 million.

During the nine months ended January 26, 2024, there was no income tax on cumulative translation adjustments.

Medtronic plc

Notes to Consolidated Financial Statements

The income tax on net investment hedges in other comprehensive income before reclassifications during the nine months ended January 24, 2025 was an expense of $ 28 million.

During the nine months ended January 26, 2024, there were no tax impacts on net investment hedges.

For the three months ended July 25, 2025 and July 26, 2024, there was no income tax on cumulative translation adjustments.

The income tax on net investment hedges in other comprehensive income before reclassifications during the three months ended July 25, 2025 and July 26, 2024, was a benefit of $ 23 million and $ 4 million, respectively.

Refer to Note 8 to the consolidated financial statements for additional information.

The net change in retirement obligations in other comprehensive income includes amortization of net actuarial losses included in net periodic benefit cost.

During the nine months ended January 24, 2025 and January 26, 2024, there were no tax impacts on retirement obligations.

During the nine months ended January 24, 2025 and January 26, 2024, the gains and losses on defined benefit and pension items reclassified from AOCI were reduced by income taxes of $ 2 million.

During the three months ended July 25, 2025, the tax impact on retirement obligations in other comprehensive income before reclassifications was not significant.

During the three months ended July 26, 2024, there were no tax impacts on retirement obligations in other comprehensive income before reclassifications.

During the three months ended July 25, 2025 and July 26, 2024, the gains and losses on defined benefit and pension items reclassified from AOCI were reduced by an insignificant amount of income taxes.

When realized, net gains and losses on defined benefit and pension items reclassified from AOCI are recognized within other non-operating income, net .

Refer to Note 14 to the consolidated financial statements for additional information.

The income tax on unrealized gains and losses on cash flow hedges in other comprehensive income before reclassifications during the nine months ended January 24, 2025 and January 26, 2024, was an expense of $ 51 million and $ 75 million, respectively.

During the nine months ended January 24, 2025 and January 26, 2024, gains and losses on cash flow hedges reclassified from AOCI were reduced by income taxes of $ 36 million and $ 48 million, respectively.

When realized, gains and losses on currency exchange rate contracts reclassified from AOCI are recognized within other operating (income) expense, net or cost of products sold.

The income tax on unrealized gains and losses on cash flow hedges in other comprehensive income before reclassifications during the three months ended July 25, 2025 and July 26, 2024, was a benefit of $ 1 million and an expense $ 3 million, respectively.

During the three months ended July 25, 2025 and July 26, 2024, gains and losses on cash flow hedges reclassified from AOCI were reduced by income taxes of $ 3 million and $ 14 million, respectively.

When realized, gains and losses on currency exchange rate contracts reclassified from AOCI are recognized within other operating expense, net or cost of products sold.

Refer to Note 8 to the consolidated financial statements for additional information.

Medtronic plc

Notes to Consolidated Financial Statements

Commitments and Contingencies

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The Company classifies certain specified litigation charges and gains related to significant legal matters as certain litigation charges, net in the consolidated statements of income.

The Company recognized $ 22 million and $ 104 million of certain litigation charges during the three and nine months ended January 24, 2025, respectively, whereas the Company recognized no certain litigation charges and $ 105 million of certain litigation charges during the three and nine months ended January 26, 2024, respectively.

At January 24, 2025 and April 26, 2024, accrued litigation was approximately $ 0.2 billion.

The Company recognized $ 27 million and $ 81 million of certain litigation charges during the three months ended July 25, 2025, and July 26, 2024, respectively.

At July 25, 2025 and April 25, 2025, accrued litigation was approximately $ 0.2 billion and $ 0.4 billion, respectively.

The ultimate cost to the Company with respect to accrued litigation could be materially different than the amount of the current estimates and accruals and could have a material adverse impact on the Company’s consolidated earnings, financial position, and/or cash flows.

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While it is not possible to predict the outcome for most of the legal matters discussed below, the Company believes it is possible that the costs associated with these matters could have a material adverse impact on the Company’s consolidated earnings, financial position, and/or cash flows.

Medtronic plc

Notes to Consolidated Financial Statements

Intellectual Property Matters

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Court of Appeals for the Federal Circuit.

The Company has not recognized an expense in connection with this matter because it does not currently believe a loss is probable.

On July 18, 2025, the U.S.

Court of Appeals for the Federal Circuit ruled in favor of the Company and reversed the lower court, vacating the jury verdict and ruling that Medtronic did not infringe the Colibri patent.

The Company will continue to monitor the case until all additional appellate periods have expired.

Product Liability Matters

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state and federal courts that allege personal injury from hernia mesh products sold by those subsidiaries.

As of January 22, 2025, the Company and certain of its subsidiaries have been named as defendants in lawsuits filed on behalf of approximately 8,950 individual plaintiffs, and certain plaintiffs’ law firms have advised the Company that they may file additional cases in the future.

As of July 30, 2025, the Company and certain of its

Medtronic plc

Notes to Consolidated Financial Statements

subsidiaries have been named as defendants in lawsuits filed on behalf of approximately 9,350 individual plaintiffs, and certain plaintiffs’ law firms have advised the Company that they may file additional cases in the future.

Approximately 6,950 plaintiffs have pending lawsuits in a coordinated proceeding in Massachusetts state court, where they have been consolidated before a single judge.

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state and federal courts alleging personal injury from Series 600 insulin pumps with allegedly defective clear retainer rings that were subject to field corrective actions in 2019 and 2021.

As of January 28, 2025, after a number of recent dismissals, there are 15 lawsuits filed on behalf of 35 individuals.

As of August 4, 2025, after a number of recent dismissals, there are nine lawsuits filed on behalf of 20 individuals.

Plaintiffs’ firms previously notified the Company that they may file additional lawsuits in the future on behalf of several thousand additional claimants.

Most of the filed suits are coordinated in California state court.

The Company has not recorded an expense related to damages in connection with these matters because any potential loss is not currently probable and reasonably estimable.

Additionally, the Company is unable to reasonably estimate the range of loss, if any, that may result from these matters.

The Company recognized certain litigation charges in the first quarter of fiscal year 2026 in connection with these matters, and the Company's accrued expenses for these matters are included within accrued litigation as of July 25, 2025 as discussed above.

Antitrust Matters

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District Court for the Central District of California, alleging that the Company has engaged in anticompetitive and monopolistic conduct relating to its sales of advanced bipolar devices, including under contracts with group purchasing organizations.

On August 15, 2025, the court denied the Company's motion for summary judgment concluding that there are disputed factual issues to be resolved at trial.

The court has not yet set a trial date.

The Company has substantial legal and factual defenses and intends to defend itself vigorously.

The matter is currently scheduled for jury trial in June 2025.

The Company has not recorded an expense related to damages in connection with this matter because any potential loss is not currently probable and reasonably estimable.

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The Company's accrued expenses for these various environmental proceedings are included within accrued litigation as discussed above.

Medtronic plc

Notes to Consolidated Financial Statements

Anti-Corruption Matters

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Securities and Exchange Commission, U.S.

Department of Justice, and various authorities in China regarding certain activities in certain foreign countries, including China.

Department of Justice, and various authorities in other countries regarding certain activities in different global markets.

The Company is committed to regularly evaluating and, as appropriate, strengthening its anti-corruption compliance programs and practices.

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Additionally, the Company is unable to reasonably estimate the range of loss, if any, that may result from these matters.

Medtronic plc

Notes to Consolidated Financial Statements

Other Matters

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In July 2024, two rulings by the Constitutional Court of Italy found that the medical device payback law is constitutional.

Therefore, the Company increased its liability pertaining primarily to certain prior years since 2015 by $ 90 million during the three months ended July 26, 2024, as a reduction to net sales in the consolidated statements of income.

As litigation before Italian Courts is still pending, final resolution is unknown at this time, and it is possible that the amount of the Company’s liability could differ from the amount currently accrued.

Therefore, the Company increased its liability pertaining to certain prior years since 2015 by $ 90 million during the three months ended July 26, 2024, as a reduction to net sales in the consolidated statements of income.

In June 2025, the Italian government published a legislative decree confirming a reduction of the amounts due for years 2015 to 2018.

The decree was formalized into law in August 2025.

As a result, the Company decreased its liability pertaining to these years by $ 39 million during the three months ended July 25, 2025, as an increase to net sales in the consolidated statements of income.

Litigation before Italian Courts is still pending for years 2019 and beyond, as such, it is possible that the amount of the Company’s liability could materially differ from the amount currently accrued.

Contract Termination with Blackstone

As described in Note 4, the Company is party to various research and development funding arrangements with Blackstone, which are subject to certain termination provisions.

During fiscal year 2025, the parties negotiated a contractual dispute resolution under one of the funding arrangements.

As a result, the Company recognized certain litigation charges in connection with the resolution and included the accrued litigation charge in other accrued expenses on the consolidated balance sheets as of April 25, 2025.

Termination charges related to one of the Blackstone Agreements were paid in the first quarter of fiscal year 2026.

Mallinckrodt Bankruptcy Litigation

Certain of the Company’s affiliates are defendants in a lawsuit brought by a trust created in the bankruptcy of Mallinckrodt PLC (the “Trust”) in Delaware bankruptcy court.

The Trust claims that Covidien spun off its pharmaceuticals business, Mallinckrodt, in 2013 to avoid potential liability relating to opioids.

In January 2024, the Delaware bankruptcy court granted in part and denied in part an early-stage motion to dismiss all claims, finding that the claims alleging actual fraudulent transfer and alter ego or related liability could go forward, while dismissing the claims alleging constructive fraudulent transfer and breaches of fiduciary duty.

In August 2025, the court granted in part and denied in part a motion for summary judgment filed by the Company’s affiliates arguing the Trust’s claims should be dismissed as a matter of law based on application of a safe harbor provision of the bankruptcy code.

The case will now proceed to discovery into the merits of the Trust’s intentional fraudulent transfer and related claims.

The Company’s affiliates believe they have substantial legal and factual defenses and intend to defend themselves vigorously.

The Company has not recorded a liability in connection with this matter because any potential loss is not currently probable and reasonably estimable.

Additionally, the Company is unable to reasonably estimate the range of loss, if any, that may result from this matter.

In March 2009, the IRS issued its audit report on Medtronic, Inc.

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and its wholly-owned subsidiary operating in Puerto Rico, which is one of the Company's key manufacturing sites.

Tax Court (Tax Court) reviewed this dispute, and in June 2016, issued an opinion with respect to the allocation of income between the parties for fiscal years 2005 and 2006 whereby it generally rejected the IRS’s position, but also made certain modifications to the Medtronic, Inc.

The Tax Court reviewed this dispute, and in June 2016, issued an opinion with respect to the allocation of income between the parties for fiscal years 2005 and 2006 whereby it generally rejected the IRS’s position, but also made certain modifications to the Medtronic, Inc.

tax returns as filed.

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Court of Appeals for the Eighth Circuit in September 2023, and Medtronic subsequently filed a cross-appeal in October 2023.

Oral argument for the Appeal occurred in May 2025.

The IRS has issued its audit reports on Medtronic, Inc.

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Tax Court matter for fiscal years 2005 and 2006.

Medtronic, Inc.’s fiscal years 2017, 2018, and 2019 U.S.

Medtronic, Inc.’s fiscal years 2017 through 2023 U.S.

federal income tax returns are currently being audited by the IRS.

Medtronic plc

Notes to Consolidated Financial Statements

Covidien LP (a wholly owned subsidiary of Medtronic plc) has either reached agreement with the IRS or the statute of limitations has lapsed on its U.S.

federal income tax returns through fiscal year 2021.

Covidien LP’s fiscal year 2023 federal income tax return is currently being audited by the IRS.

Although it is not possible to predict the outcome for most of the income tax matters discussed above, the Company believes it is possible that charges associated with these matters could have a material adverse impact on the Company’s consolidated earnings, financial position, and/or cash flows.

Refer to Note 11 for additional discussion of income taxes.

Medtronic plc

Notes to Consolidated Financial Statements

In the normal course of business, the Company and/or its affiliates periodically enter into agreements that require one or more of the Company and/or its affiliates to indemnify customers or suppliers for specific risks, such as claims for injury or property damage arising as a result of the Company or its affiliates’ products, the negligence of the Company's personnel, or claims alleging that the Company's products infringe on third-party patents or other intellectual property.

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Historically, the Company has not experienced significant losses on these types of guarantees.

We also enter into standby letters of credit agreements, bank guarantees, and surety bonds with financial institutions to support various performance and other obligations, as well as ongoing tax matters.

As of July 25, 2025, the aggregated amount outstanding under these instruments was approximately $ 1.2 billion.

The Company believes the ultimate resolution of the above guarantees is not expected to have a material effect on the Company’s consolidated earnings, financial position, and/or cash flows.

Segment and Geographic Information

Segment disclosures are on a performance basis consistent with internal management reporting.

Net sales of the Company's reportable segments include end-customer revenues from the sale of products the segment develops, manufactures, and distributes.

The Company’s management evaluates performance of the segments and allocates resources based on net sales and segment operating profit.

Segment operating profit represents income before income taxes, excluding interest income or expense, amortization of intangible assets, centralized distribution costs, currency impact of remeasurement and hedging, non-operating income or expense items, certain corporate charges, stock-based compensation, and other items not allocated to the segments.

The Company has four reportable segments:

Cardiovascular Portfolio, Neuroscience Portfolio, Medical Surgical Portfolio, and Diabetes Operating Unit.

The chief operating decision maker (CODM) is our Chief Executive Officer (CEO) and has chosen to organize the entity based upon therapy solutions provided by each segment.

The four reportable segments are strategic businesses that are managed separately, as each one develops and manufactures products and provides services oriented toward targeted therapy solutions.

The CODM measures and evaluates segment performance and allocates resources based on net sales and segment operating profit.

Net sales include end-customer revenues from products developed, manufactured, and distributed by the segments.

Significant expense categories include cost of products sold excluding amortization of intangible assets, research and development expense, and selling, general, and administrative expenses.

The CODM uses segment operating profit in the budget and forecasting process and to monitor budget and forecast variances versus actual when assessing segment performance and allocating capital resources to each segment.

Segment operating profit excludes interest income and expense, amortization of intangible assets, currency impact of remeasurement and hedging recorded in other operating expense, net , non-operating income or expense items, and other items not allocated to the segments.

During the first quarter of fiscal year 2026, the segment operating profit utilized by the CODM to evaluate segment performance and allocate resources changed to include allocations of certain corporate expenses, stock-based compensation, and centralized distribution expenses.

For the three months ended July 26, 2024, segment operating profit includes allocations of $ 0.9 billion of corporate, stock-based compensation and centralized distribution expenses that were previously excluded from segment operating profit.

Prior period information has been recast to conform to the current classification.

The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies in Note 1 to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended April 25, 2025.

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The allocation of depreciation expense is based on the proportion of the assets used by each segment.

There have been no changes to reportable segments during the three and nine months ended January 24, 2025.

We continue to have four reportable segments:

Cardiovascular Portfolio, Neuroscience Portfolio, Medical Surgical Portfolio, and Diabetes Operating Unit.

Prior period amounts have been recast to conform to the new operating segment structure in the fourth quarter of fiscal year 2024.

For further information on the operating segment structure changes, refer to Note 19 to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended April 26, 2024.

Medtronic plc

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Segment Operating Profit

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

Cardiovascular $ 1,205 $ 1,090 $ 3,494 $ 3,298

Neuroscience 1,061 994 3,046 2,853

Medical Surgical 765 812 2,229 2,332

Diabetes 136 118 354 304

Three months ended July 25, 2025

(in millions) Cardiovascular Neuroscience Medical Surgical Diabetes Total

Net sales $ 3,285 $ 2,416 $ 2,083 $ 721 $ 8,506

Reconciliation of revenues

Other operating segment net sales (1)

Other adjustments (2)

Total consolidated net sales $ 8,578

Cost of products sold, excluding amortization of intangible assets 1,132 721 814 304 2,972

Research and development expense 280 157 169 120 725

Selling, general, and administrative expense 1,060 831 605 274 2,771

Other segment items (3)

( 15 ) 2 1 ( 3 ) ( 15 )

Reportable segment operating profit $ 828 $ 705 $ 494 $ 26 $ 2,053

Other operating segment (1)

Corporate ( 481 ) ( 466 ) ( 1,383 ) ( 1,345 )

Reconciliation of segment profit / (loss)

Other operating segment profit (1)

Currency and other ( 47 )

Interest expense, net ( 176 )

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Amortization of intangible assets ( 459 )

Stock-based compensation ( 98 ) ( 85 ) ( 340 ) ( 303 )

Centralized distribution costs ( 445 ) ( 415 ) ( 1,244 ) ( 1,202 )

Restructuring and associated costs ( 67 )

Acquisition and divestiture-related items ( 58 )

Certain litigation charges, net ( 27 )

Other adjustments (2)

Income before income taxes $ 1,302

Medtronic plc

Notes to Consolidated Financial Statements

Three months ended July 26, 2024

(in millions) Cardiovascular Neuroscience Medical Surgical Diabetes Total

Net sales $ 3,007 $ 2,317 $ 1,996 $ 647 $ 7,967

Reconciliation of revenues

Other operating segment net sales (1)

Other adjustments (2)

Total consolidated net sales $ 7,915

Cost of products sold, excluding amortization of intangible assets 998 657 778 272 2,706

Research and development expense 257 153 162 101 673

Selling, general, and administrative expense 978 808 591 259 2,637

Other segment items (3)

( 6 ) 11 5 ( 9 ) 1

Reportable segment operating profit $ 780 $ 687 $ 459 $ 24 $ 1,950

Reconciliation of segment profit / (loss)

Other operating segment profit (1)

Currency and other ( 10 )

Interest expense, net ( 167 )

Other non-operating income, net 157

Amortization of intangible assets ( 414 )

Restructuring and associated costs ( 62 )

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Income before income taxes $ 1,268

(1) Includes the historical operations and ongoing transition agreements from businesses the Company has exited or divested.

(2) Includes the net impact of remeasurement and the Company's hedging programs recorded in other operating (income) expense, net.

(3) Incremental Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court of Italy relating to certain prior years since 2015.

(1) Includes the operations and ongoing transition agreements from businesses the Company has exited or divested.

(2) Includes adjustments to the Company's Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court and the Legislative Decree published by the Italian government on June 30, 2025 for certain prior years since 2015.

(3) Other segment items for the Cardiovascular, Neuroscience, and Medical Surgical segments include royalty expense.

The Cardiovascular segment for both periods and the Diabetes segment for the three months ended July 26, 2024 also include income from funded research and development arrangements.

Medtronic plc

Notes to Consolidated Financial Statements

(in millions) July 25, 2025 April 25, 2025

Cardiovascular $ 16,573 $ 16,548

Neuroscience 18,433 18,476

Medical Surgical 33,326 33,317

Diabetes 4,209 4,136

Total reportable segments 72,542 72,476

Other operating segment (1)

Corporate 18,228 18,906

Total $ 90,972 $ 91,680

(1) Includes the operations and ongoing transition agreements from businesses the Company has exited or divested.

Depreciation Expense

Three months ended

(in millions) July 25, 2025 July 26, 2024

Cardiovascular $ 64 $ 55

Neuroscience 77 65

Medical Surgical 54 49

Diabetes 31 24

Total reportable segments 225 194

Corporate 64 53

Total $ 289 $ 248

Geographic Information

Net sales are attributed to the country based on the location of the customer taking possession of the products or in which the services are rendered.

The following table presents net sales for the three and nine months ended January 24, 2025 and January 26, 2024 for the Company's country of domicile, countries with significant concentrations, and all other countries:

Three months ended Nine months ended

(in millions) January 24, 2025 January 26, 2024 January 24, 2025 January 26, 2024

The following table presents net sales for the three months ended July 25, 2025 and July 26, 2024 for the Company's country of domicile, countries with significant concentrations, and all other countries:

Three months ended

(in millions) July 25, 2025 July 26, 2024

Ireland $ 33 $ 30

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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