What changed in this filing

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Item 1. Financial Statements

2024-05-03 compared with 2023-11-03 · 160 added, 236 removed, 559 unchanged (41% of the section changed)

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30, December 31,

March 30, December 31,

(In millions except share and per share amounts) 2024 2023

1 unchanged sentence

Cash and cash equivalents $ 5,499 $ 8,077

Short-term investments 1,751 3

Accounts receivable, less allowances of $ 197 and $ 193

38 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three months ended Nine months ended

September 30, October 1, September 30, October 1,

Three months ended

March 30, April 1,

(In millions except per share amounts) 2024 2023

2 unchanged sentences

Service revenues

4,417 4,094 13,139 11,862

Total revenues

2 unchanged sentences

Cost of product revenues

3,214 3,494 9,829 10,565

Cost of service revenues

3,044 2,881 9,435 8,535

Selling, general and administrative expenses

2,049 2,208 6,313 6,694

Research and development expenses

319 351 1,010 1,080

Restructuring and other costs

Total costs and operating expenses

8,710 8,967 26,966 26,933

Operating income 1,663 1,563

2 unchanged sentences

Other income/(expense)

14 ( 4 ) ( 32 ) ( 139 )

Income before income taxes

1,765 1,601 4,558 6,058

Provision for income taxes

14 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three months ended Nine months ended

September 30, October 1, September 30, October 1,

Three months ended

March 30, April 1,

(In millions) 2024 2023

4 unchanged sentences

Currency translation adjustment (net of tax provision (benefit) of $ 166 and $( 36 ))

( 112 ) ( 216 ) 57 ( 632 )

Unrealized gains and losses on hedging instruments:

Unrealized gains/(losses) on available-for-sale debt securities

Unrealized holding losses arising during the period (net of tax (provision) benefit of $ 0 and $ 0 )

Unrealized gains/(losses) on hedging instruments:

Reclassification adjustment for losses included in net income (net of tax (provision) benefit of $ 0 and $ 1 )

1 unchanged sentence

Pension and other postretirement benefit liability adjustments arising during the period (net of tax (provision) benefit of $ 0 and $( 1 ))

Amortization of net loss included in net periodic pension cost (net of tax (provision) benefit of $( 1 ), $ 0 , $( 1 ) and $ 2 )

Total other comprehensive income/(loss) 457 48

Comprehensive income

1,586 1,291 4,411 4,777

comprehensive income/(loss) attributable to noncontrolling interests and redeemable noncontrolling interest

( 26 ) — ( 26 ) 2

Comprehensive income attributable to Thermo Fisher Scientific Inc.

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine months ended

September 30, October 1,

Three months ended

March 30, April 1,

(In millions) 2024 2023

6 unchanged sentences

( 253 ) ( 146 )

Loss on early extinguishment of debt — 26

Stock-based compensation

3 unchanged sentences

Investing activities

Acquisitions, net of cash acquired

( 3,660 ) ( 39 )

Purchase of property, plant and equipment

( 1,074 ) ( 1,693 )

Purchases of property, plant and equipment ( 347 ) ( 458 )

Proceeds from sale of property, plant and equipment

Proceeds from cross-currency interest rate swap interest settlements 64 2

Acquisitions, net of cash acquired — ( 2,704 )

Purchases of investments ( 1,758 ) ( 2 )

Other investing activities, net

3 unchanged sentences

Net proceeds from issuance of debt

Repayment of debt

( 2,000 ) ( 375 )

Proceeds from issuance of commercial paper

Repayments of commercial paper

( 1,935 ) ( 3,690 )

Purchases of company common stock

13 unchanged sentences

THERMO FISHER SCIENTIFIC INC.

CONDENSED CONSOLIDATED STATEMENT OF REDEEMABLE NONCONTROLLING INTEREST AND EQUITY

Redeemable Noncontrolling Interest Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock Accumulated Other Comprehensive Items Total

Thermo Fisher Scientific Inc.

Shareholders’ Equity Noncontrolling Interests Total Equity

(In millions) Shares Amount Shares Amount

Three months ended September 30, 2023

Balance at July 1, 2023 $ 113 441 $ 441 $ 17,030 $ 44,289 55 $ ( 15,084 ) $ ( 2,924 ) $ 43,752 $ 50 $ 43,802

Issuance of shares under employees' and directors' stock plans

— 1 1 68 — 1 ( 37 ) — 32 — 32

Stock-based compensation

— — — 67 — — — — 67 — 67

Dividends declared ($ 0.35 per share)

— — — — ( 135 ) — — — ( 135 ) — ( 135 )

Net income/(loss)

6 — — — 1,715 — — — 1,715 ( 26 ) 1,689

Other comprehensive items

( 1 ) — — — — — — ( 103 ) ( 103 ) ( 5 ) ( 108 )

Contributions from (distributions to) noncontrolling interests — — — — — — — — — ( 1 ) ( 1 )

Balance at September 30, 2023 $ 118 442 $ 442 $ 17,165 $ 45,869 56 $ ( 15,121 ) $ ( 3,027 ) $ 45,328 $ 18 $ 45,346

Three months ended October 1, 2022

Balance at July 2, 2022 $ 117 440 $ 440 $ 16,467 $ 39,074 48 $ ( 10,964 ) $ ( 2,724 ) $ 42,293 $ 61 $ 42,354

Issuance of shares under employees' and directors' stock plans

— — — 52 — — ( 47 ) — 5 — 5

Stock-based compensation

— — — 77 — — — — 77 — 77

Dividends declared ($ 0.30 per share)

— — — — ( 117 ) — — — ( 117 ) — ( 117 )

Net income/(loss)

5 — — — 1,495 — — — 1,495 ( 2 ) 1,493

Other comprehensive items

( 3 ) — — — — — — ( 204 ) ( 204 ) — ( 204 )

Balance at October 1, 2022 $ 119 440 $ 440 $ 16,596 $ 40,452 48 $ ( 11,011 ) $ ( 2,928 ) $ 43,549 $ 59 $ 43,608

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

THERMO FISHER SCIENTIFIC INC.

CONDENSED CONSOLIDATED STATEMENT OF REDEEMABLE NONCONTROLLING INTEREST AND EQUITY (Continued)

CONDENSED CONSOLIDATED STATEMENTS OF REDEEMABLE NONCONTROLLING INTEREST AND EQUITY

Redeemable Noncontrolling Interest Common Stock Capital in Excess of Par Value Retained Earnings Treasury Stock Accumulated Other Comprehensive Items Total

2 unchanged sentences

(In millions) Shares Amount Shares Amount

Nine months ended September 30, 2023

Three months ended March 30, 2024

Balance at December 31, 2023 $ 118 442 $ 442 $ 17,286 $ 47,364 56 $ ( 15,133 ) $ ( 3,224 ) $ 46,735 $ ( 11 ) $ 46,724

Issuance of shares under employees' and directors' stock plans

Issuance of shares under stock plans

— 1 1 126 — — ( 24 ) — 103 — 103

7 unchanged sentences

4 — — — 1,328 — — — 1,328 — 1,328

Other comprehensive income/(loss)

Other comprehensive items

( 3 ) — — — — — — 460 460 — 460

Contributions from (distributions to) noncontrolling interests ( 7 ) — — — — — — — — ( 1 ) ( 1 )

Contributions from (distributions to) noncontrolling interest — — — — — — — — — ( 1 ) ( 1 )

Excise tax from stock repurchases — — — — — — ( 29 ) — ( 29 ) — ( 29 )

Balance at September 30, 2023 $ 118 442 $ 442 $ 17,165 $ 45,869 56 $ ( 15,121 ) $ ( 3,027 ) $ 45,328 $ 18 $ 45,346

Nine months ended October 1, 2022

Balance at March 30, 2024 $ 119 443 $ 443 $ 17,482 $ 48,542 61 $ ( 18,186 ) $ ( 2,764 ) $ 45,516 $ ( 12 ) $ 45,504

Three months ended April 1, 2023

Balance at December 31, 2022 $ 116 441 $ 441 $ 16,743 $ 41,910 50 $ ( 12,017 ) $ ( 3,099 ) $ 43,978 $ 54 $ 44,032

Issuance of shares under employees' and directors' stock plans

Issuance of shares under stock plans

— — — 70 — — ( 36 ) — 34 — 34

7 unchanged sentences

4 — — — 1,289 — — — 1,289 ( 1 ) 1,288

Other comprehensive income/(loss)

Other comprehensive items

3 — — — — — — 45 45 — 45

Contributions from (distributions to) noncontrolling interests ( 7 ) — — — — — — — — ( 1 ) ( 1 )

Balance at October 1, 2022 $ 119 440 $ 440 $ 16,596 $ 40,452 48 $ ( 11,011 ) $ ( 2,928 ) $ 43,549 $ 59 $ 43,608

Excise tax from stock repurchases — — — — — — ( 30 ) — ( 30 ) — ( 30 )

Balance at April 1, 2023 $ 123 441 $ 441 $ 16,889 $ 43,064 55 $ ( 15,083 ) $ ( 3,054 ) $ 42,257 $ 53 $ 42,310

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

7 unchanged sentences

Interim Financial Statements

The interim condensed consolidated financial statements presented herein have been prepared by the company, are unaudited and, in the opinion of management, reflect all adjustments of a normal recurring nature necessary for a fair statement of the financial position at September 30, 2023, the results of operations for the three- and nine-month periods ended September 30, 2023 and October 1, 2022, and the cash flows for the nine-month periods ended September 30, 2023 and October 1, 2022.

The interim condensed consolidated financial statements presented herein have been prepared by the company, are unaudited and, in the opinion of management, reflect all adjustments of a normal recurring nature necessary for a fair statement of the financial position at March 30, 2024, the results of operations for the three-month periods ended March 30, 2024 and April 1, 2023, and the cash flows for the three-month periods ended March 30, 2024 and April 1, 2023.

Interim results are not necessarily indicative of results for a full year.

4 unchanged sentences

Note 1 to the consolidated financial statements for 2023 describes the significant accounting estimates and policies used in preparation of the consolidated financial statements.

There have been no material changes in the company’s significant accounting policies during the nine months ended September 30, 2023.

There have been no material changes in the company’s significant accounting policies during the three months ended March 30, 2024.

Amounts and percentages reported within these condensed consolidated financial statements are presented and calculated based on underlying unrounded amounts.

As a result, the sum of components may not equal corresponding totals due to rounding.

The components of inventories are as follows:

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

(In millions) March 30, 2024 December 31, 2023

Raw materials $ 2,038 $ 2,057

7 unchanged sentences

Recent Accounting Pronouncements

In September 2022, the FASB issued new guidance to require entities to disclose information about supplier finance programs.

Among other things, the new guidance requires expanded disclosure about key program terms, payment terms, and amounts outstanding for obligations under these programs for each period presented.

The company adopted some aspects of this guidance in 2023 using a retrospective method and will adopt other aspects in 2024 using a prospective method.

The adoption of this guidance did not have, and is not expected to have, a material impact on the company’s disclosures;

however, the impact in future periods will be dependent on the extent of arrangements of this nature entered into by the company.

In November 2021, the FASB issued new guidance to require entities to disclose information about certain types of government assistance they receive, including cash grants and tax credits.

Among other things, the new guidance requires expanded disclosure regarding the qualitative and quantitative characteristics of the nature, amount, timing, and significant terms and conditions of transactions with a government arising from a grant or other forms of assistance accounted for under a contribution model.

The company adopted this guidance in the fourth quarter of 2022 using a prospective method.

The adoption of this guidance did not have a material impact on the company’s disclosures.

The following table provides a description of recent accounting pronouncements adopted and those standards not yet adopted with potential for a material impact on the company's financial statements or disclosures.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Standard Description Required adoption timing and approach Impact of adoption or other significant matters

Standards recently adopted

2022-04, Liabilities-Supplier Finance Programs (Subtopic 405-50):

Disclosure of Supplier Finance Program Obligations New guidance to disclose information about supplier finance programs.

Among other things, the new guidance requires expanded disclosure about key program terms, payment terms, and amounts outstanding for obligations under supplier finance programs for each period presented.

Some aspects adopted in 2023 using a retrospective method and will adopt other aspects in 2024 annual report using a prospective method Not material

Standards not yet adopted

2023-07, Segment Reporting (Topic 280):

Improving Reportable Segment Disclosures Among other things, new guidance to disclose significant segment expenses and other items by reportable segment as well as information about the chief operating decision maker.

2024 annual report and interim periods thereafter using a retrospective method Will increase disclosures in Note 4

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures Among other things, new guidance to disclose additional information about the tax rate reconciliation and income taxes paid.

2025 annual report and interim periods thereafter using a prospective or retrospective method Will increase disclosures in Note 5

The company’s acquisitions have historically been made at prices above the determined fair value of the acquired identifiable net assets, resulting in goodwill, primarily due to expectations of the synergies that will be realized by combining the businesses and the benefits that will be gained from the assembled workforces.

3 unchanged sentences

Acquisitions have been accounted for using the acquisition method of accounting, and the acquired companies’ results have been included in the accompanying financial statements from their respective dates of acquisition.

Proposed Acquisition

On October 17, 2023, the company entered into a purchase agreement to acquire all of the issued and outstanding shares of Olink Holding AB (publ) at a price of $ 26.00 per share, or approximately $ 3.1 billion.

Olink is a leading provider of next-generation proteomics solutions that will expand the company’s capabilities in this field.

The company has commenced a tender offer to acquire all of the American Depositary Shares and common shares of Olink.

The transaction is expected to close by mid-year 2024, subject to the satisfaction of customary closing conditions including receipt of applicable regulatory approvals, and completion of the tender offer.

Upon completion, Olink will become part of the Life Sciences Solutions segment.

The company intends to finance the purchase price with cash on hand and the net proceeds from issuances of debt.

On January 3, 2023, the company acquired, within the Specialty Diagnostics segment, The Binding Site Group, a U.K.-based provider of specialty diagnostic assays and instruments to improve the diagnosis and management of blood cancers and immune system disorders.

3 unchanged sentences

The acquisition expands the segment’s portfolio with the addition of highly complementary real-world evidence solutions to enhance decision-making as well as the time and cost of drug development.

The goodwill recorded as a result of this business combination is not expected to be tax deductible.

The goodwill recorded as a result of this business combination is not tax deductible.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The components of the purchase price and net assets acquired are as follows:

13 unchanged sentences

In addition, in 2023, the company acquired, within the Analytical Instruments segment, a U.S.-based developer of Raman-based spectroscopy solutions for in-line measurement.

The weighted-average amortization period for definite-lived intangible assets acquired in 2023 are 18 years for customer relationships, 14 years for product technology, 15 years for tradenames, and 13 years for backlog.

The weighted-average amortization periods for definite-lived intangible assets acquired in 2023 are 18 years for customer relationships, 14 years for product technology, 15 years for tradenames, and 13 years for backlog.

The weighted average amortization period for all definite-lived intangible assets acquired in 2023 is 17 years.

Proposed Acquisition

Olink is a leading provider of next-generation proteomics solutions that will expand the company’s capabilities in this field.

The company has commenced a tender offer to acquire all of the American Depositary Shares and common shares of Olink.

Upon completion, Olink will become part of the Life Sciences Solutions segment.

The company intends to finance the purchase price with cash on hand and the net proceeds from issuances of debt.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Revenues and Contract-related Balances

1 unchanged sentence

Revenues by type are as follows:

Three months ended Nine months ended

(In millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

$ 4,289 $ 4,651 $ 13,228 $ 15,754

1,868 1,932 5,604 5,849

Three months ended

(In millions) March 30, 2024 April 1, 2023

$ 4,328 $ 4,506

1 unchanged sentence

Revenues by geographic region based on customer location are as follows:

Three months ended Nine months ended

(In millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Three months ended

(In millions) March 30, 2024 April 1, 2023

North America

$ 5,519 $ 5,778

2,643 2,406 7,898 8,007

1,913 1,971 5,801 6,077

Other regions

350 338 1,112 1,064

Consolidated revenues $ 10,345 $ 10,710

1 unchanged sentence

See Note 4 for revenues by reportable segment and other geographic data.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Remaining Performance Obligations

The aggregate amount of the transaction price allocated to the remaining performance obligations for all open customer contracts as of September 30, 2023 was $ 26.81 billion.

The aggregate amount of the transaction price allocated to the remaining performance obligations for all open customer contracts as of March 30, 2024 was $ 26.37 billion.

The company will recognize revenues for these performance obligations as they are satisfied, approximately 51 % of which is expected to occur within the next twelve months .

3 unchanged sentences

Contract asset and liability balances are as follows:

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

(In millions) March 30, 2024 December 31, 2023

Current contract assets, net $ 1,422 $ 1,443

2 unchanged sentences

Noncurrent contract liabilities 1,427 1,499

In the three and nine months ended September 30, 2023, the company recognized revenues of $ 0.35 billion and $ 2.32 billion, respectively, that were included in the contract liabilities balance at December 31, 2022.

In the three and nine months ended October 1, 2022, the company recognized revenues of $ 0.34 billion and $ 2.33 billion, respectively, that were included in the contract liabilities balance at December 31, 2021.

Noncurrent contract liabilities increased during 2023 primarily due to rights to advanced payments from a customer.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In the three months ended March 30, 2024, the company recognized revenues of $ 1.32 billion that were included in the contract liabilities balance at December 31, 2023.

In the three months ended April 1, 2023, the company recognized revenues of $ 1.30 billion that were included in the contract liabilities balance at December 31, 2022.

Business Segment and Geographical Information

Business Segment Information

Three months ended Nine months ended

September 30, October 1, September 30, October 1,

Three months ended

March 30, April 1,

(In millions) 2024 2023

2 unchanged sentences

Analytical Instruments

1,754 1,621 5,226 4,746

Specialty Diagnostics

1,083 1,065 3,300 3,648

Laboratory Products and Biopharma Services

( 460 ) ( 496 )

( 424 ) ( 556 ) ( 1,385 ) ( 1,978 )

Consolidated revenues

2 unchanged sentences

Life Sciences Solutions

872 1,039 2,525 4,542

Analytical Instruments

468 386 1,321 1,031

Specialty Diagnostics

283 220 860 816

Laboratory Products and Biopharma Services

937 725 2,554 2,036

Subtotal reportable segments

2,560 2,370 7,260 8,425

Cost of revenues adjustments

1 unchanged sentence

Selling, general and administrative expenses adjustments

( 14 ) ( 11 ) ( 28 ) 10

Restructuring and other costs

3 unchanged sentences

Consolidated operating income

1,864 1,710 5,005 6,532

Interest income 279 146

1 unchanged sentence

Other income/(expense)

14 ( 4 ) ( 32 ) ( 139 )

Consolidated income before taxes

$ 1,589 $ 1,363

Cost of revenues adjustments included in the above table consist of charges for the sale of inventories revalued at the date of acquisition, inventory write-downs associated with large-scale abandonment of product lines, and accelerated depreciation on manufacturing assets to be abandoned due to facility consolidations.

Selling, general and administrative expenses adjustments included in the above table consist of third-party transaction/integration costs related to recent acquisitions, charges/credits for changes in estimates of contingent acquisition consideration, and charges associated with product liability litigation.

Cost of revenues adjustments included in the above table consist of charges for the sale of inventories revalued at the date of acquisition and inventory write-downs associated with large-scale abandonment of product lines.

Selling, general and administrative expenses adjustments included in the above table consist of third-party transaction/integration costs related to recent acquisitions, and charges/credits for changes in estimates of contingent acquisition consideration.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Geographical Information

Revenues by country based on customer location are as follows:

Three months ended Nine months ended

(In millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Three months ended

(In millions) March 30, 2024 April 1, 2023

United States

$ 5,322 $ 5,587

5,084 4,890 15,363 15,735

Consolidated revenues

$ 10,345 $ 10,710

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The provision for income taxes in the accompanying statements of income differs from the provision calculated by applying the statutory federal income tax rate to income before provision for income taxes due to the following:

Nine months ended

(In millions) September 30, 2023 October 1, 2022

Three months ended

(In millions) March 30, 2024 April 1, 2023

Statutory federal income tax rate

Provision for income taxes at statutory rate

$ 957 $ 1,272

Increases (decreases) resulting from:

11 unchanged sentences

( 102 ) ( 144 )

Foreign exchange loss on inter-company debt refinancing

Provision for (reversal of) valuation allowances, net

1 unchanged sentence

Tax return reassessments and settlements

( 63 ) ( 94 )

State income taxes, net of federal tax

( 28 ) ( 66 )

Provision for income taxes

During the third quarter of 2023, the company released a valuation allowance of $ 183 million in jurisdictions where the deferred tax assets are now expected to be realized.

In the first nine months of 2023 the company also recorded a tax benefit of $ 91 million, net of related tax expenses, from a foreign exchange loss on an intercompany debt refinancing transaction, as well as a $ 144 million tax benefit resulting from a capital loss generated as part of an intra-entity transaction.

During the third quarter of 2022, the company settled an IRS audit relating to the 2017 and 2018 tax years.

The company recorded a $ 208 million net tax benefit primarily from this settlement and related impacts, which resulted in a decrease in the company’s unrecognized tax benefits of $ 658 million.

The company recorded $ 49 million of charges for expired tax credits and other related components of the settlement.

The company recorded a charge of $ 395 million to establish a valuation allowance against certain U.S.

foreign tax credits which the company believes will more likely than not expire unutilized.

The company also recorded $ 101 million of additional net unrecognized tax benefit liabilities related to other tax audits.

During the first quarter of 2024, the company recorded a tax reserve and associated interest of $ 240 million related to the potential settlement of international tax audits for tax years 2009 through 2016.

The company has operations and a taxable presence in approximately 70 countries outside the U.S.

3 unchanged sentences

Unrecognized Tax Benefits

As of September 30, 2023 the company had $ 0.55 billion of unrecognized tax benefits substantially all of which, if recognized, would reduce the effective tax rate.

As of March 30, 2024 the company had $ 0.69 billion of unrecognized tax benefits substantially all of which, if recognized, would reduce the effective tax rate.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:

1 unchanged sentence

Balance at beginning of year

Additions for tax positions of current year

Additions for tax positions of prior years

Reductions for tax positions of prior years

Closure of tax years

Balance at end of period

2 unchanged sentences

Earnings per Share

Three months ended Nine months ended

September 30, October 1, September 30, October 1,

Three months ended

March 30, April 1,

(In millions except per share amounts) 2024 2023

9 unchanged sentences

Debt and Other Financing Arrangements

Effective interest rate at September 30, September 30, December 31,

Effective interest rate at March 30, March 30, December 31,

(Dollars in millions) 2024 2024 2023

Commercial Paper $ — $ 310

Floating Rate (SOFR + 0.35 %) 1.5 -Year Senior Notes, Due 4/18/2023

Floating Rate (SOFR + 0.39 %) 2 -Year Senior Notes, Due 10/18/2023

0.797 % 2 -Year Senior Notes, Due 10/18/2023

1.03 % 1,350 1,350

Floating Rate (EURIBOR + 0.20 %) 2 -Year Senior Notes, Due 11/18/2023 (euro-denominated)

3.79 % 1,797 1,819

0.75 % 8 -Year Senior Notes, Due 9/12/2024 (euro-denominated)

0.93 % 1,079 1,104

0.75 % 8 -Year Senior Notes, Due 9/12/2024 (euro-denominated)

0.93 % 1,057 1,071

Floating Rate (SOFR + 0.53 %) 3 -Year Senior Notes, Due 10/18/2024

1.215 % 3 -Year Senior Notes, Due 10/18/2024

4 unchanged sentences

2.10 % 691 706

0.853 % 3 -Year Senior Notes, Due 10/20/2025 (yen-denominated)

0.853 % 3 -Year Senior Notes, Due 10/20/2025 (Japanese yen-denominated)

1.05 % 147 158

6 unchanged sentences

4.953 % 3 -Year Senior Notes, Due 8/10/2026

5.19 % 600 600

5.000 % 3 -Year Senior Notes, Due 12/5/2026

5.25 % 1,000 1,000

1.45 % 10 -Year Senior Notes, Due 3/16/2027 (euro-denominated)

2 unchanged sentences

1.96 % 647 662

1.054 % 5 -Year Senior Notes, Due 10/20/2027 (yen-denominated)

1.054 % 5 -Year Senior Notes, Due 10/20/2027 (Japanese yen-denominated)

1.18 % 191 205

3 unchanged sentences

0.77 % 863 883

0.77 % 5 -Year Senior Notes, Due 9/6/2028 (yen-denominated)

1.6525 % 4 -Year Senior Notes, Due 3/7/2028 (Swiss franc-denominated)

0.77 % 5 -Year Senior Notes, Due 9/6/2028 (Japanese yen-denominated)

0.90 % 192 206

1.375 % 12 -Year Senior Notes, Due 9/12/2028 (euro-denominated)

2 unchanged sentences

1.89 % 700 700

5.000 % 5 -Year Senior Notes, Due 1/31/2029

5.24 % 1,000 1,000

1.95 % 12 -Year Senior Notes, Due 7/24/2029 (euro-denominated)

2 unchanged sentences

2.74 % 900 900

1.279 % 7 -Year Senior Notes, Due 10/19/2029 (yen-denominated)

1.279 % 7 -Year Senior Notes, Due 10/19/2029 (Japanese yen-denominated)

4.977 % 7 -Year Senior Notes, Due 8/10/2030

5.12 % 750 750

0.80 % 9 -Year Senior Notes, Due 10/18/2030 (euro-denominated)

0.88 % 1,888 1,932

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Effective interest rate at September 30, September 30, December 31,

(Dollars in millions) 2023 2023 2022

0.875 % 12 -Year Senior Notes, Due 10/1/2031 (euro-denominated)

2 unchanged sentences

2.23 % 1,200 1,200

1.840 % 8 -Year Senior Notes, Due 3/8/2032 (Swiss franc-denominated)

2.375 % 12 -Year Senior Notes, Due 4/15/2032 (euro-denominated)

2.54 % 647 662

1.49 % 10 -Year Senior Notes, Due 10/20/2032 (yen-denominated)

1.49 % 10 -Year Senior Notes, Due 10/20/2032 (Japanese yen-denominated)

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Effective interest rate at March 30, March 30, December 31,

(Dollars in millions) 2024 2024 2023

4.95 % 10 -Year Senior Notes, Due 11/21/2032

4 unchanged sentences

1.20 % 1,619 1,656

5.200 % 10 -Year Senior Notes, Due 1/31/2034

5.34 % 500 500

3.65 % 12 -Year Senior Notes, Due 11/21/2034 (euro-denominated)

3.76 % 809 828

1.50 % 12 -Year Senior Notes, due 9/6/2035 (yen-denominated)

1.50 % 12 -Year Senior Notes, Due 9/6/2035 (Japanese yen-denominated)

1.58 % 142 152

2.0375 % 12 -Year Senior Notes, Due 3/7/2036 (Swiss franc-denominated)

2.875 % 20 -Year Senior Notes, Due 7/24/2037 (euro-denominated)

6 unchanged sentences

1.77 % 1,349 1,380

2.069 % 20 -Year Senior Notes, Due 10/20/2042 (yen-denominated)

2.069 % 20 -Year Senior Notes, Due 10/20/2042 (Japanese yen-denominated)

2.13 % 97 104

5.404 % 20 -Year Senior Notes, Due 8/10/2043

2.02 % 20 -Year Senior Notes, due 9/6/2043 (yen-denominated)

5.50 % 600 600

2.02 % 20 -Year Senior Notes, Due 9/6/2043 (Japanese yen-denominated)

2.06 % 192 206

5.30 % 30 -Year Senior Notes, Due 2/1/2044

6 unchanged sentences

2.07 % 809 828

2.382 % 30 -Year Senior Notes, Due 10/18/2052 (yen-denominated)

2.382 % 30 -Year Senior Notes, Due 10/18/2052 (Japanese yen-denominated)

2.43 % 220 236

10 unchanged sentences

Long-term obligations $ 31,157 $ 31,308

SOFR - Secured Overnight Financing Rate

EURIBOR - Euro Interbank Offered Rate

The effective interest rates for the fixed-rate debt include the stated interest on the notes, the accretion of any discounts/premiums and the amortization of any debt issuance costs.

3 unchanged sentences

The Facility expires on January 7, 2027.

The revolving credit agreement calls for interest at either a Term SOFR, a EURIBOR-based rate (for funds drawn in euro) or a rate based on the prime lending rate of the agent bank, at the company’s option.

The revolving credit agreement calls for interest at either a Term Secured Overnight Financing Rate (SOFR), a Euro Interbank Offered Rate (EURIBOR)-based rate (for funds drawn in euro), or a rate based on the prime lending rate of the agent bank, at the company’s option.

The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type.

1 unchanged sentence

Specifically, the company has agreed that, so long as any lender has any commitment under the Facility, any letter of credit is outstanding under the Facility, or any loan or other obligation is outstanding under the Facility, it will maintain a minimum Consolidated Net Interest Coverage Ratio of 3.5 :1.0 as of the last day of any fiscal quarter.

As of September 30, 2023, no borrowings were outstanding under the Facility, although available capacity was reduced by immaterial outstanding letters of credit.

As of March 30, 2024, no borrowings were outstanding under the Facility, although available capacity was reduced by immaterial outstanding letters of credit.

THERMO FISHER SCIENTIFIC INC.

7 unchanged sentences

Under both programs, the CP Notes are issued at a discount from par (or premium to par, in the case of negative interest rates), or, alternatively, are sold at par and bear varying interest rates on a fixed or floating basis.

Interest is payable quarterly on the floating rate senior notes, annually on the euro-denominated fixed rate senior notes and semi-annually on all other senior notes.

Interest is payable annually on the euro and Swiss franc-denominated fixed rate senior notes and semi-annually on all other senior notes.

Each of the U.S.

dollar and euro-denominated fixed rate senior notes and yen-denominated private placement notes may be redeemed at a redemption price of 100 % of the principal amount plus a specified make-whole premium and accrued interest, together with swap breakage costs payable to holders of yen-denominated private placement notes who have entered into cross-currency swap agreements.

dollar and euro-denominated fixed rate senior notes and Japanese yen-denominated private placement notes may be redeemed at a redemption price of 100 % of the principal amount plus a specified make-whole premium and accrued interest, together with swap breakage costs payable to holders of Japanese yen-denominated private placement notes who have entered into cross-currency swap agreements.

The company is subject to certain affirmative and negative covenants under the indentures and note purchase agreement governing the senior notes, the most restrictive of which limits the ability of the company to pledge certain property and assets as security under borrowing arrangements.

The company was in compliance with all covenants at September 30, 2023.

In the first quarter of 2022, the company redeemed all of its 3.650 % Senior Notes due 2025.

In connection with the redemption, the company incurred $ 26 million of losses on the early extinguishment of debt included in other income/(expense) on the accompanying statements of income.

The company was in compliance with all covenants related to its senior notes at March 30, 2024.

Thermo Fisher Scientific (Finance I) B.V.

(Thermo Fisher International), a wholly-owned finance subsidiary of the company, issued each of the Floating Rate Senior Notes due 2023, the 0.00 % Senior Notes due 2023, the 0.00 % Senior Notes due 2025, the 0.80 % Senior Notes due 2030, the 1.125 % Senior Notes due 2033, the 1.625 % Senior Notes due 2041, and the 2.00 % Senior Notes due 2051 included in the table above (collectively, the “Euronotes”) in registered public offerings.

(Thermo Fisher International), a wholly-owned finance subsidiary of the company, issued each of the following notes outstanding as of March 30, 2024, included in the table above (collectively, the “Euronotes”) in registered public offerings:

the 0.00 % Senior Notes due 2025, the 0.80 % Senior Notes due 2030, the 1.125 % Senior Notes due 2033, the 1.625 % Senior Notes due 2041, and the 2.00 % Senior Notes due 2051.

The company has fully and unconditionally guaranteed all of Thermo Fisher International’s obligations under the Euronotes and all of Thermo Fisher International’s other debt securities, and no other subsidiary of the company will guarantee these obligations.

6 unchanged sentences

Expenses for environmental remediation matters related to the costs of installing, operating and maintaining groundwater-treatment systems and other remedial activities related to historical environmental contamination at the company’s domestic and international facilities were not material in any period presented.

At September 30, 2023, there have been no material changes to the accruals for pending environmental-related matters disclosed in the company’s 2022 financial statements and notes included in the company’s Annual Report on Form 10-K.

At March 30, 2024, there have been no material changes to the accruals for pending environmental-related matters disclosed in the company’s 2023 financial statements and notes included in the company’s Annual Report on Form 10-K.

While management believes the accruals for environmental remediation are adequate based on current estimates of remediation costs, the company may be subject to additional remedial or compliance costs due to future events such as changes in existing laws and regulations, changes in agency direction or enforcement policies, developments in remediation technologies or changes in the conduct of the company’s operations, which could have a material adverse effect on the company’s financial position, results of operations and cash flows.

3 unchanged sentences

Due to the inherent uncertainties associated with pending litigation or claims, the company cannot predict the outcome, nor, with respect to certain pending litigation or claims where no liability has been accrued, make a meaningful estimate of the reasonably possible loss or range of loss that could result from an unfavorable outcome.

The company has no material accruals for pending litigation or claims for

The company has no material accruals for pending litigation or claims for which accrual amounts are not disclosed in the company’s 2023 financial statements and notes included in the company’s Annual Report on Form 10-K, nor are material losses deemed probable for such matters.

It is reasonably possible, however, that

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

which accrual amounts are not disclosed in the company’s 2022 financial statements and notes included in the company’s Annual Report on Form 10-K, nor are material losses deemed probable for such matters.

It is reasonably possible, however, that an unfavorable outcome that exceeds the company’s current accrual estimate, if any, for one or more such matters could have a material adverse effect on the company’s results of operations, financial position and cash flows.

an unfavorable outcome that exceeds the company’s current accrual estimate, if any, for one or more such matters could have a material adverse effect on the company’s results of operations, financial position and cash flows.

Product Liability, Workers Compensation and Other Personal Injury Matters

The company is involved in various proceedings and litigation that arise from time to time in connection with product liability, workers compensation and other personal injury matters.

At September 30, 2023, there have been no material changes to the accruals for pending product liability, workers compensation, and other personal injury matters disclosed in the company’s 2022 financial statements and notes included in the company’s Annual Report on Form 10-K.

At March 30, 2024, there have been no material changes to the accruals for pending product liability, workers compensation, and other personal injury matters disclosed in the company’s 2023 financial statements and notes included in the company’s Annual Report on Form 10-K.

Although the company believes that the amounts accrued and estimated insurance recoveries are probable and appropriate based on available information, including actuarial studies of loss estimates, the process of estimating losses and insurance recoveries involves a considerable degree of judgment by management and the ultimate amounts could vary, which could have a material adverse effect on the company’s results of operations, financial position, and cash flows.

2 unchanged sentences

Management monitors the payment history as well as the financial condition and ratings of its insurers on an ongoing basis.

Comprehensive Income/(Loss)

Comprehensive Income/(Loss) and Shareholders' Equity

Comprehensive Income/(Loss)

1 unchanged sentence

(In millions) Currency

adjustment Unrealized

adjustment Unrealized gains/(losses) on available-for-sale debt securities Unrealized

gains/(losses) on

instruments Pension and

3 unchanged sentences

Other comprehensive income/(loss) before reclassifications

Amounts reclassified from accumulated other comprehensive income/(loss)

456 ( 1 ) — 1 456

Amounts reclassified from accumulated other comprehensive income/(loss)

Net other comprehensive income/(loss)

Balance at September 30, 2023 $ ( 2,813 ) $ ( 28 ) $ ( 186 ) $ ( 3,027 )

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

459 ( 1 ) 1 1 460

Balance at March 30, 2024 $ ( 2,482 ) $ ( 1 ) $ ( 27 ) $ ( 254 ) $ ( 2,764 )

Fair Value Measurements and Fair Value of Financial Instruments

1 unchanged sentence

The following tables present information about the company’s financial assets and liabilities measured at fair value on a recurring basis:

September 30, Quoted

March 30, Quoted

markets Significant

12 unchanged sentences

$ 141 $ — $ 57 $ 83

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

December 31, Quoted

4 unchanged sentences

$ 5,021 $ 5,021 $ — $ —

Bank time deposits 3 3 — —

Insurance contracts

6 unchanged sentences

$ 377 $ — $ 290 $ 87

The company uses the Black-Scholes model to value its warrants.

The company determines the fair value of its insurance contracts by obtaining the cash surrender value of the contracts from the issuer.

2 unchanged sentences

Changes to the fair value of contingent consideration are recorded in selling, general and administrative expense.

In the three and nine months ended September 30, 2023, the company recorded $ 11 million and $( 33 ) million, respectively, of net gains/(losses) on investments, which are included in other income/(expense) in the accompanying statements of income.

In the three and nine months ended October 1, 2022, the company recorded $ 13 million and $ 136 million, respectively, of net losses on investments, which are included in other income/(expense) in the accompanying statements of income.

In the three months ended March 30, 2024 and April 1, 2023, the company recorded $ 10 million and $( 44 ) million, respectively, of net gains/(losses) on investments, which are included in other income/(expense) in the accompanying statements of income.

The following table provides a rollforward of the fair value, as determined by level 3 inputs (such as likelihood of achieving production or revenue milestones, as well as changes in the fair values of the investments underlying a recapitalization investment portfolio), of the contingent consideration.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Three months ended Nine months ended

September 30, October 1, September 30, October 1,

Three months ended

March 30, April 1,

(In millions) 2024 2023

1 unchanged sentence

Beginning balance $ 87 $ 174

Acquisitions (including assumed balances) — — 1 ( 18 )

Payments ( 2 ) ( 15 )

3 unchanged sentences

The following table provides the aggregate notional value of outstanding derivative contracts.

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

Notional amount

Cross-currency interest rate swaps - designated as net investment hedges

$ 5,650 $ 2,100

(In millions) March 30, 2024 December 31, 2023

Cross-currency interest rate swaps designated as net investment hedge - euro $ 1,000 $ 1,000

Cross-currency interest rate swaps designated as net investment hedge - Japanese yen 4,650 4,650

Cross-currency interest rate swaps designated as net investment hedge - Swiss franc 2,500 2,500

Currency exchange contracts 1,381 1,567

1 unchanged sentence

The following tables present the fair value of derivative instruments in the accompanying balance sheets and statements of income.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Fair value – assets Fair value – liabilities

September 30, December 31, September 30, December 31,

March 30, December 31, March 30, December 31,

(In millions) 2024 2023 2024 2023

8 unchanged sentences

Gain (loss) recognized

Three months ended Nine months ended

September 30, October 1, September 30, October 1,

Three months ended

March 30, April 1,

(In millions) 2024 2023

2 unchanged sentences

Amount reclassified from accumulated other comprehensive items to interest expense $ ( 1 ) $ —

$ ( 1 ) $ ( 1 ) $ ( 6 ) $ ( 3 )

Amount reclassified from accumulated other comprehensive items to other income/(expense) — ( 4 )

Financial instruments designated as net investment hedges

1 unchanged sentence

Included in currency translation adjustment within other comprehensive items

364 658 158 1,691

Cross-currency interest rate swaps

Included in currency translation adjustment within other comprehensive items

( 56 ) 46 ( 6 ) 120

Included in interest expense

3 unchanged sentences

Included in other income/(expense)

( 6 ) 20 ( 8 ) 32

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Gains and losses recognized on currency exchange contracts are included in the accompanying statements of income together with the corresponding, offsetting losses and gains on the underlying hedged transactions.

3 unchanged sentences

See Note 1 to the consolidated financial statements for 2023 included in the company’s Annual Report on Form 10-K for additional information on the company’s risk management objectives and strategies.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Fair Value of Other Financial Instruments

The carrying value and fair value of the company’s debt instruments are as follows:

September 30, 2023 December 31, 2022

March 30, 2024 December 31, 2023

Carrying Fair Carrying Fair

1 unchanged sentence

$ 35,318 $ 32,587 $ 34,650 $ 32,191

Commercial paper

$ 35,393 $ 32,662 $ 34,727 $ 32,268

2 unchanged sentences

Supplemental Cash Flow Information

Nine months ended

(In millions) September 30, 2023 October 1, 2022

Three months ended

(In millions) March 30, 2024 April 1, 2023

Non-cash investing and financing activities

4 unchanged sentences

Cash, cash equivalents and restricted cash is included in the accompanying balance sheet as follows:

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

(In millions) March 30, 2024 December 31, 2023

Cash and cash equivalents $ 5,499 $ 8,077

3 unchanged sentences

Amounts included in restricted cash primarily represent funds held as collateral for bank guarantees and incoming cash in China awaiting government administrative clearance.

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Restructuring and Other Costs

In the first nine months of 2023, restructuring and other costs primarily included continuing charges for headcount reductions and facility consolidations in an effort to streamline operations, impairment of long-lived assets, and, to a lesser extent, net charges for pre-acquisition litigation and other matters.

In 2023, severance actions associated with facility consolidations and cost reduction measures affected approximately 4 % of the company’s workforce.

As of November 3, 2023, the company has identified restructuring actions that will result in additional charges of approximately $ 65 million, primarily in 2023, and expects to identify additional actions in future periods which will be recorded when specified criteria are met, such as communication of benefit arrangements or when the costs have been incurred.

In the first three months of 2024, restructuring and other costs primarily included continuing charges for headcount reductions and facility consolidations in an effort to streamline operations.

In 2024, severance actions associated with facility consolidations and cost reduction measures affected less than 1 % of the company’s workforce.

As of May 3, 2024, the company has identified restructuring actions that will result in additional charges of approximately $ 75 million, primarily in 2024, and expects to identify additional actions in future periods which will be recorded when specified criteria are met, such as communication of benefit arrangements or when the costs have been incurred.

Restructuring and other costs by segment are as follows:

Three months ended Nine months ended

(In millions) September 30, 2023 September 30, 2023

Three months ended

(In millions) March 30, 2024

Life Sciences Solutions

2 unchanged sentences

Laboratory Products and Biopharma Services

THERMO FISHER SCIENTIFIC INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the changes in the company’s accrued restructuring balance, which is included in other accrued expenses in the accompanying balance sheet.

2 unchanged sentences

Balance at December 31, 2023 $ 60

Net restructuring charges incurred in 2023 (b) (c)

Net restructuring charges incurred in 2024 (b)

Currency translation

Balance at September 30, 2023 $ 73

Balance at March 30, 2024 $ 51

(a) The movements in the restructuring liability principally consist of severance and other costs associated with facility consolidations.

(b) Excludes $ 165 million of net charges, principally $ 127 million of charges for impairment of long-lived assets in the Laboratory Products and Biopharma Services and Life Sciences Solutions segments, $ 26 million of contract termination costs associated with facility closures in the Laboratory Products and Biopharma Services segment, $ 18 million of net charges for pre-acquisition litigation and other matters.

(c) Excludes $ 39 million of charges for impairment of a disposal group that was held for sale beginning in the third quarter of 2023.

The loss attributable to Thermo Fisher Scientific Inc.

was reduced by $ 19 million attributable to a noncontrolling interest.

(b) Excludes $ 4 million of net non-cash charges.

The company expects to pay accrued restructuring costs primarily through 2024.

1 unchanged sentence

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