What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-02-27 compared with 2024-02-29 · 637 added, 520 removed, 1351 unchanged (46% of the section changed)

5 unchanged sentences

Consolidated Statements of Operations - Years ended December 31, 2024, 2023, and 2022

Consolidated Statements of Comprehensive Income or Loss - Years ended December 31, 2023, 2022, and 2021

Consolidated Statements of Comprehensive Loss - Years ended December 31, 2024, 2023, and 2022

Consolidated Balance Sheets - December 31, 2024 and 2023

2 unchanged sentences

Note 1 - Significant Accounting Policies

Note 2 - Revenue

Note 2 - Revenue Recognition

Note 3 - Stock Compensation

Note 4 - Earnings Per Common Share

Note 5 - Comprehensive (Loss) Income

Note 4 - Loss Per Common Share

Note 5 - Comprehensive Loss

Note 6 - Segment and Geographic Information

Note 7 - Other Expense (Income), Net

Note 7 - Other (Income) Expense, Net

Note 8 - Inventories, Net

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Based on its assessment, management concluded that, as of December 31, 2024, the Company’s internal control over financial reporting was effective based on the criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

The effectiveness of the Company’s internal control over financial reporting as of December 31, 2023 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which appears herein.

Campion /s/ Glenn G.

Campion Glenn G.

President and Chief Executive Officer Executive Vice President and

Chief Financial Officer

February 29, 2024 February 29, 2024

The effectiveness of the Company’s internal control over financial reporting as of December 31, 2024 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report, which appears herein.

President and Chief Executive Officer

February 27, 2025

Report of Independent Registered Public Accounting Firm

To the stockholders and the Board of Directors of DENTSPLY SIRONA Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of DENTSPLY SIRONA Inc.

and subsidiaries (the “Company”) as of December 31, 2024, the related consolidated statements of operations, comprehensive loss, changes in equity, and cash flows for the year ended December 31, 2024, and the related notes and financial statement schedule listed in the index appearing under Item 8 (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 27, 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing a separate opinion on the critical audit matters or on the accounts or disclosures to which they relate.

Goodwill — Implant and Prosthetic Solutions and Orthodontic Aligner Solutions Reporting Units — Refer to Note 11 to the financial statements

Critical Audit Matter Description

The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying value.

The Company used the discounted cash flow model to estimate the fair value of its reporting units, which requires management to make significant estimates and assumptions related to discount rates and forecasts of future revenues and operating margins.

Changes in these assumptions could have a significant impact on either the fair value, the amount of any goodwill impairment charge, or both.

The goodwill balance for the Orthodontic and Implant Solutions segment is comprised of the Implant & Prosthetic Solutions (IPS) and Orthodontic Aligner Solutions (OAS) reporting units.

As of the annual goodwill impairment assessment date (April 1, 2024), the fair values of the IPS and OAS reporting units exceeded their carrying values and, therefore, no impairment was recognized.

Subsequent to the annual impairment assessment date, management identified indicators of “more likely than not” impairments related to its IPS and OAS reporting units.

As a result of the interim tests, management recorded goodwill impairment charges for the year ended December 31, 2024 related to the OAS and IPS reporting units.

We identified the Company’s impairment evaluations of goodwill at IPS and OAS to be a critical audit matter because of the significant judgments made by management to estimate the fair values of IPS and OAS and the sensitivity of IPS’s and OAS’s future revenues and operating margins to changes in demand.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to forecasts of future revenues and operating margins, and the selection of discount rates.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the forecasts of future revenues and operating margins (“forecasts”), and the selection of discount rates for the IPS and OAS reporting units included the following, among others:

• We tested the design and operating effectiveness of controls over management’s goodwill impairment evaluation, including those over the evaluation of possible triggering events that might have occurred throughout the year and the determination of the fair values of IPS and OAS, such as controls related to management’s forecasts and selection of discount rates.

• We evaluated the reasonableness of management’s forecasts through consideration of (1) current and past performance of the reporting units, (2) consistency with external peer and industry data, (3) the impact of changes in the regulatory environment on the reporting units, and (4) consistency with management’s growth strategy and evidence obtained in other areas of the audit.

• With the assistance of our fair value specialists, we evaluated the discount rates, including testing the underlying source information and the mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the discount rates selected by management.

Indefinite-lived Intangible Assets – Orthodontic and Implant Solutions and Connected Technology Solutions Segments — Refer to Note 11 to the financial statements

Critical Audit Matter Description

The Company’s evaluation of indefinite-lived assets for impairment involves the comparison of the fair value of each asset to its carrying value.

The Company uses a relief-from-royalty methodology to estimate the fair value of its indefinite-lived trade names and trademarks, which requires management to make significant estimates and assumptions related to the discount rate, royalty rate, and forecasts of future revenues.

Changes in these assumptions could have a significant impact on either the fair value, the amount of any intangible asset impairment charge, or both.

Management conducted an impairment test as of the annual impairment assessment date (April 1, 2024), and also conducts an impairment test whenever events or circumstances suggest that the carrying amount of the assets may not be recoverable.

During the year ended December 31, 2024, management identified indicators of a “more likely than not” impairment of certain of its indefinite-lived trade names and trademarks within its Connected Technology Solutions (CTS) segment and within the IPS reporting unit of the Orthodontic and Implant Solutions (OIS) segment.

As a result of performing impairment tests, management recorded impairment charges related to indefinite-lived intangible assets within its CTS and OIS segments.

We identified the Company’s impairment evaluation of indefinite-lived intangibles related to the CTS segment and the IPS reporting unit of the OIS segment to be a critical audit matter because of the significant judgments made by management to estimate the fair value of trade names and trademarks.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to forecasts of future revenues, and the selection of discount and royalty rates.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the forecasts of future revenues and the selection of discount and royalty rates for the trade names and trademarks within the CTS segment and the IPS reporting unit of the OIS segment included the following, among others:

• We tested the design and operating effectiveness of controls over management’s indefinite-lived asset impairment evaluation, including those over the evaluation of possible triggering events occurring throughout the year and the determination of the fair value of trade names and trademarks, such as controls related to management’s revenue forecasts and selection of the discount and royalty rates.

• We evaluated the reasonableness of management’s revenue forecasts through consideration of (1) current and past performance, (2) consistency with external peer and industry data, (3) the impact of changes in the regulatory environment, and (4) consistency with management’s growth strategy and evidence obtained in other areas of the audit.

• With the assistance of our fair value specialists, we evaluated discount and royalty rates, including testing the underlying source information and mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the discount and royalty rates selected by management.

/s/ Deloitte & Touche LLP

Charlotte, North Carolina

February 27, 2025

We have served as the Company’s auditor since 2024.

Report of Independent Registered Public Accounting Firm

To the stockholders and the Board of Directors of DENTSPLY SIRONA Inc.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of DENTSPLY SIRONA Inc.

and subsidiaries (the “Company”) as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated February 27, 2025, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Charlotte, North Carolina

February 27, 2025

We have served as the Company’s auditor since 2024.

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Dentsply Sirona Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Dentsply Sirona Inc.

and its subsidiaries (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations, of comprehensive income or loss, of changes in equity and of cash flows for each of the three years in the period ended December 31, 2023, including the related notes and financial statement schedule listed in the index appearing under Item 8 (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

We have audited the consolidated balance sheet of Dentsply Sirona Inc.

and its subsidiaries (the “Company”) as of December 31, 2023, and the related consolidated statements of operations, of comprehensive loss, of changes in equity and of cash flows for each of the two years in the period ended December 31, 2023, including the related notes and schedule of valuation and qualifying accounts for each of the two years in the period ended December 31, 2023 listed in the accompanying index (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits.

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Annual and Interim Goodwill Impairment Assessments – Certain Reporting Units

As described in Notes 1 and 11 to the consolidated financial statements, the Company’s consolidated net goodwill balance was $2,438 million as of December 31, 2023, of which a portion relates to certain reporting units.

Goodwill is tested for impairment at the reporting unit level annually as of April 1 of each year, or more frequently if events or circumstances indicate that the carrying value of goodwill may be impaired.

Management performs impairment tests by comparing the fair value of each reporting unit to its carrying amount to determine if there is a potential impairment.

On April 1, 2023, management realigned its reporting units due to a change in organizational structure.

Reporting units under the former structure were tested for impairment prior to the realignment, and no impairment was identified.

As a result of the realignment, the Company reallocated its goodwill to align its new reporting units which resulted from the change in its operating segments.

Goodwill was reassigned to each of the new reporting units using a relative fair value approach.

Management assessed the goodwill of the new reporting units and its indefinite-lived intangible assets for impairment as of April 1, 2023.

Based on this test, it was determined that the fair values of its reporting units and indefinite-lived intangible assets more likely than not exceeded their carrying values, resulting in no impairment.

In the third quarter of 2023, management identified indicators of a "more likely than not" impairment related to its Connected Technology Solutions reporting unit, which comprises all of the Connected Technology Solutions segment.

The decline in fair value for this reporting unit was driven by adverse macroeconomic factors as a result of weakened demand, particularly in European markets, and increased discount rates.

As a result of the interim test, management recorded a pre-tax goodwill impairment charge related to the Connected Technology Solutions reporting unit within the Connected Technology Solutions segment of $291 million.

As disclosed by management, the Company uses a discounted cash flow model as its valuation technique to measure the fair value for its reporting units.

The discounted cash flow model uses five- to ten-year forecasted cash flows plus a terminal value based on capitalizing the last period’s cash flows using a perpetual growth rate.

The significant assumptions used by management in the application of the discounted cash flow model include, but are not limited to, the discount rates, revenue growth rates, perpetual revenue growth rates, and future operating margin percentages of the reporting unit’s business.

The principal considerations for our determination that performing procedures relating to the annual and interim goodwill impairment assessments of certain reporting units is a critical audit matter are (i) the significant judgment by management when developing the fair value estimates of the reporting units, (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to the discount rates, revenue growth rates, perpetual revenue growth rates, and future operating margin percentages for both the annual and interim assessments, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessments, including controls over the valuation of the Company’s reporting units.

These procedures also included, among others, testing management’s process for developing the fair value estimates of certain of the Company’s reporting units;

evaluating the appropriateness of the discounted cash flow models;

testing the completeness and accuracy of underlying data used in the discounted cash flow models;

and evaluating the reasonableness of significant assumptions used by management related to the discount rates, revenue growth rates, perpetual revenue growth rates, and future operating margin percentages.

Evaluating management’s assumptions related to revenue growth rates, perpetual revenue growth rates, and future operating margin percentages involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units;

(ii) the consistency with external market and industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s discounted cash flow models and (ii) the reasonableness of the assumptions related to the discount rates and perpetual revenue growth rates.

We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

1 unchanged sentence

Charlotte, North Carolina

February 29, 2024

We have served as the Company’s auditor since 2000.

February 29, 2024, except for the change in the manner in which the Company accounts for segments discussed in Note 1 to the consolidated financial statements, as to which the date is February 27, 2025

We served as the Company’s auditor from 2000 to 2024.

DENTSPLY SIRONA INC.

10 unchanged sentences

Goodwill and intangible asset impairments 1,014 307 1,287

Restructuring and other costs 67 14 17

Operating (loss) income ( 85 ) ( 937 ) 608

Restructuring costs

Operating loss ( 879 ) ( 85 ) ( 937 )

Other income and expenses:

Interest expense, net 69 81 65

Other expense (income), net 9 53 2

(Loss) income before income taxes ( 175 ) ( 1,055 ) 545

(Benefit) provision for income taxes ( 43 ) ( 105 ) 134

Net (loss) income ( 132 ) ( 950 ) 411

Net income (loss) attributable to noncontrolling interests — — —

Net (loss) income attributable to Dentsply Sirona $ ( 132 ) $ ( 950 ) $ 411

Other (income) expense, net ( 12 ) 9 53

Loss before income taxes ( 936 ) ( 175 ) ( 1,055 )

Benefit from income taxes ( 26 ) ( 43 ) ( 105 )

Net loss ( 910 ) ( 132 ) ( 950 )

Net income attributable to noncontrolling interests — — —

Net loss attributable to Dentsply Sirona $ ( 910 ) $ ( 132 ) $ ( 950 )

Net (loss) income per common share attributable to Dentsply Sirona:

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AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME OR LOSS

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in millions)

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2024 2023 2022

Net (loss) income $ ( 132 ) $ ( 950 ) $ 411

Net loss $ ( 910 ) $ ( 132 ) $ ( 950 )

Other comprehensive (loss) income, net of tax:

Foreign currency translation adjustments ( 146 ) 49 ( 156 )

Net (loss) gain on derivative financial instruments ( 30 ) 29 25

Net gain (loss) on derivative financial instruments 40 ( 30 ) 29

Pension liability adjustments 12 ( 27 ) 91

Total other comprehensive loss ( 94 ) ( 8 ) ( 36 )

Total comprehensive (loss) income ( 140 ) ( 986 ) 281

Total comprehensive loss ( 1,004 ) ( 140 ) ( 986 )

Comprehensive (loss) income attributable to noncontrolling interests — — —

Comprehensive (loss) income attributable to Dentsply Sirona $ ( 140 ) $ ( 986 ) $ 283

Total comprehensive loss attributable to Dentsply Sirona $ ( 1,004 ) $ ( 140 ) $ ( 986 )

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

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Capital in excess of par value 6,640 6,643

Retained earnings 205 456

(Accumulated deficit) retained earnings ( 835 ) 205

Accumulated other comprehensive loss ( 730 ) ( 636 )

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(in millions, except per share amounts)

(Accumulated Deficit)

Comprehensive

Income (Loss)

Noncontrolling

Balance at December 31, 2021 $ 3 $ 6,606 $ 1,514 $ ( 592 ) $ ( 2,535 ) $ 4,996 $ 1 $ 4,997

— — 411 — — 411 — 411

Net loss — — ( 950 ) — — ( 950 ) — ( 950 )

Other comprehensive loss — — — ( 36 ) — ( 36 ) — ( 36 )

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Restricted stock unit distributions — ( 38 ) — — 25 ( 13 ) — ( 13 )

Restricted stock unit dividends — 1 ( 1 ) — — — — —

Cash dividends declared ($ 0.50 per share)

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Restricted stock unit distributions — ( 32 ) — — 23 ( 9 ) — ( 9 )

Restricted stock unit dividends — 1 ( 1 ) — — — — —

Cash dividends declared ($ 0.56 per share)

3 unchanged sentences

Other comprehensive loss — — — ( 94 ) — ( 94 ) — ( 94 )

Exercise of stock options — ( 1 ) — — 1 — — —

Stock-based compensation expense — 39 — — — 39 — 39

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Cash flows from operating activities:

Net (loss) income $ ( 132 ) $ ( 950 ) $ 411

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Net loss $ ( 910 ) $ ( 132 ) $ ( 950 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation 133 132 119

1 unchanged sentence

Goodwill impairment 773 291 1,187

Indefinite-lived intangible asset impairment 16 100 —

Intangible asset impairment 241 16 100

Deferred income taxes ( 136 ) ( 130 ) ( 228 )

Stock-based compensation expense 39 46 59

Restructuring and other costs 33 ( 10 ) ( 17 )

Equity in earnings from unconsolidated affiliates — 4 36

Other non-cash (income) expense ( 9 ) ( 2 ) 60

Loss (gain) on sale or disposal of non-strategic businesses and product lines — 3 ( 14 )

Changes in operating assets and liabilities, net of acquisitions:

Loss (gain) on disposal of property, plant and equipment 19 ( 3 ) 3

Changes in operating assets and liabilities:

Accounts and notes receivable-trade, net 104 ( 58 ) 85

8 unchanged sentences

Cash flows from investing activities:

Cash paid for acquisitions of businesses and equity investments, net of cash acquired — — ( 248 )

Cash received on sale of non-strategic businesses or product lines — 13 —

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Cash received on derivative contracts 1 39 13

Proceeds from sale of property, plant and equipment

Cash paid on derivative contracts ( 12 ) — —

Other investing activities, net ( 6 ) 8 ( 2 )

3 unchanged sentences

Repayments on long-term borrowings ( 88 ) ( 7 ) ( 2 )

Net borrowings (repayments) on short-term borrowings 126 ( 64 ) 179

Proceeds from exercised stock options — 6 51

Net borrowings on short-term borrowings 177 126 ( 64 )

Cash paid for treasury stock ( 250 ) ( 300 ) ( 150 )

4 unchanged sentences

Net (decrease) increase in cash and cash equivalents ( 62 ) ( 31 ) 26

( 31 ) 26 ( 99 )

Cash and cash equivalents at beginning of period 334 365 339

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DENTSPLY SIRONA Inc.

(“Dentsply Sirona” or the “Company”), is the world’s largest manufacturer of dental products and technologies, with a 137 -year history of innovation and service to the dental industry and patients worldwide.

(“Dentsply Sirona” or the “Company”), is the world’s largest diversified manufacturer of dental products and technologies, with a 138 -year history of innovation and service to the dental industry and patients worldwide.

The Company’s principal product categories include dental consumable products, dental equipment, dental technologies and continence care consumable products.

The Company sells its products in over 150 countries under some of the most well-established brand names in the industry.

The Company sells its products in approximately 150 countries under some of the most well-established brand names in the industry.

Basis of Presentation

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Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expense during the reporting period.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expense during the reporting period.

Actual results could differ materially from those estimates.

2 unchanged sentences

The balance as of December 31, 2024 includes $ 39 million of cash and cash equivalents located in Russia which is available for use in local operations but limited in its ability to be transferred out of the country due to control measures currently in place by the Russian government.

Short-term Investments

Short-term investments are highly liquid time deposits with original maturities greater than ninety days and with remaining maturities of one year or less.

Accounts Receivable

The Company recognizes a receivable when it has an unconditional right to payment, which represents the amount the Company expects to collect in a transaction.

Payment terms are typically 30 days in the United States but may be longer in markets outside the U.S.

Payment terms are typically 30 days in the United States but may be longer in markets outside the United States.

In general, contracts containing significant financing components are not material to the Company’s financial statements.

3 unchanged sentences

For customers on credit terms, the Company performs ongoing credit evaluation of those customers’ financial condition and generally does not require collateral from them.

See Note 2, Revenue, for additional information on Accounts Receivable.

See Note 2, Revenue Recognition, for additional information on Accounts Receivable.

Inventories are stated at the lower of cost and net realizable value.

3 unchanged sentences

Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired and liabilities assumed in a business combination.

Goodwill is not subject to amortization but is tested for impairment at the reporting unit level annually in accordance with U.S.

GAAP as of April 1 of each year, or more frequently if events or circumstances indicate that the carrying value of goodwill may be impaired.

Goodwill is not subject to amortization but is tested for impairment at the reporting unit level annually in accordance with US GAAP as of April 1 of each year, or more frequently if events or circumstances indicate that the carrying value of goodwill may be impaired.

The Company performs impairment tests by comparing the fair value of each reporting unit to its carrying amount to determine if there is a potential impairment.

If the carrying value of a reporting unit with goodwill exceeds its respective fair value, an impairment charge is recognized for the excess amount.

Additional information related to the testing for goodwill impairment, including results of the annual test performed as of April 1, 2023 and the interim impairment assessment performed in the third quarter of 2023, is provided in Note 11, Goodwill and Intangible Assets.

Additional information related to the testing for goodwill impairment, including results of the annual test performed as of April 1, 2024 and the interim impairment assessments performed in the third and fourth quarters of 2024, is provided in Note 11, Goodwill and Intangible Assets.

Indefinite-Lived Intangible Assets

Indefinite-lived intangible assets consist primarily of tradenames and trademarks and in-process research and development (“R&D”) acquired in business combinations, and these are not subject to amortization.

Valuations of indefinite-lived intangibles assets acquired in business combinations are based on information and assumptions available at the time of their acquisition, using income and market approaches to determine fair value.

The Company conducts an impairment test in accordance with U.S.

GAAP as of April 1 of each year, or more frequently if events or circumstances indicate that the carrying value of indefinite-lived intangible assets may be impaired.

Indefinite-lived intangible assets consist primarily of trade names and trademarks and in-process research and development (“R&D”) acquired in business combinations, and these are not subject to amortization.

Valuations of indefinite-lived intangible assets acquired in business combinations are based on information and assumptions available at the time of their acquisition, using income and market approaches to determine fair value.

The Company conducts an impairment test in accordance with US GAAP as of April 1 of each year, or more frequently if events or circumstances indicate that the carrying value of indefinite-lived intangible assets may be impaired.

Potential impairment is identified by comparing the fair value of an intangible asset to its carrying value.

Additional information related to the testing for indefinite-lived intangible asset impairment, including results of the annual test performed as of April 1, 2023 and the interim impairment assessment performed in the third quarter of 2023, is provided in Note 11, Goodwill and Intangible Assets.

Additional information related to the testing for indefinite-lived intangible asset impairment, including results of the annual test performed as of April 1, 2024 and the interim impairment assessments performed in the first, third, and fourth quarters of 2024, is provided in Note 11, Goodwill and Intangible Assets.

Definite-Lived Intangible Assets

Definite-lived intangible assets primarily consist of patents, tradenames, trademarks, licensing agreements, developed technology, and customer relationships.

The valuation of definite-lived intangibles assets acquired in business combinations is based on information and assumptions available at the time of acquisition, using income and market model approaches to determine fair value.

Definite-lived intangible assets primarily consist of patents, trade names, trademarks, licensing agreements, developed technology, and customer relationships.

The valuation of definite-lived intangible assets acquired in business combinations is based on information and assumptions available at the time of acquisition, using income and market model approaches to determine fair value.

Identifiable definite-lived intangible assets are amortized on a basis that best reflects how their economic benefits are utilized over the life of the asset or on a straight-line basis if not materially different from actual utilization.

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Patents Up to the date the patent expires

Tradenames and trademarks Up to 20 years

Trade names and trademarks Up to 20 years

Licensing agreements Up to 20 years

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Developed technology Up to 15 years

When the expected useful life of an intangible is not known, the Company will estimate its useful life based on similar asset or asset groups, any legal, regulatory, or contractual provision that limits the useful life, the effect of economic factors, including obsolescence, demand, competition, and the level of maintenance expenditures required to obtain the expected future economic benefit from the asset.

When the expected useful life of an intangible is not known, the Company will estimate its useful life based on similar assets or asset groups, any legal, regulatory, or contractual provision that limits the useful life, the effect of economic factors, including obsolescence, demand, competition, and the level of maintenance expenditures required to obtain the expected future economic benefit from the asset.

These assets are reviewed for impairment whenever events or circumstances suggest that the carrying amount of the asset may not be recoverable.

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Impairment is based upon an initial evaluation of the identifiable undiscounted cash flows.

If the initial evaluation identifies a potential impairment, a fair value of the asset is determined by using a discounted cash flows valuation.

If the initial evaluation identifies a potential impairment, a fair value of the asset is determined by using a discounted cash flow valuation.

If impaired, the resulting charge reflects the excess of the asset’s carrying cost over its fair value.

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The Company employs derivative financial instruments to hedge certain anticipated transactions, firm commitments, and assets and liabilities denominated in foreign currencies.

Additionally, the Company manages exposures to changes in interest rates by utilizing interest rate swaps that have the effect of converting floating rate debt to fixed rate, or vice versa.

Additionally, the Company manages exposure to changes in interest rates by utilizing interest rate swaps that have the effect of converting floating rate debt to fixed rate, or vice versa.

The benefit or loss from interest rate swaps is recorded in Interest expense, net in the Company’s Consolidated Statements of Operations consistent with the classification of interest expense attributable to the underlying debt.

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The Company has elected to classify the cash flows from derivative instruments in the same category as the cash flows from the items being hedged.

Should the Company enter into a derivative instrument that includes an other-than-insignificant financing element then all cash flows will be classified as financing activities in the Consolidated Statements of Cash Flows as required by U.S.

See Note 19, Financial Instruments for additional information on derivative instruments.

See Note 19, Financial Instruments for additional information.

Pension and Other Postemployment Benefits

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The Company reports the funded status of its defined benefit pension and other postemployment benefit plans on its consolidated balance sheets as a net liability or asset.

Additional information related to the impact of changes in these assumptions is provided in Note 17, Benefit Plans.

See Note 17, Benefit Plans for additional information.

Accruals for Self-Insured Losses

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If no point within the range represents a better estimate of the probable loss, then the low point in the range is accrued.

The ranges established by management are based on analysis made by internal and external legal counsel who considers the best information known at the time.

The ranges established by management are based on analysis made by internal and external legal counsel who consider the best information known at the time.

If the Company determines that a contingency is reasonably possible, it considers the same information to estimate the possible exposure and discloses any material potential liability.

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Legal costs related to these lawsuits are expensed as incurred.

For additional information on ongoing litigation see Note 21, Commitments and Contingencies.

Foreign Currency Translation

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dollars are included in AOCI in the Consolidated Balance Sheets.

During the year ended December 31, 2023, the Company had a translation gain of $ 78 million and a loss on its loans designated as hedges of net investments of $ 29 million.

During the year ended December 31, 2024, the Company had a translation loss of $ 192 million and a gain on its loans designated as hedges of net investments of $ 46 million.

During the year ended December 31, 2023, the Company had a translation gain of $ 78 million and a loss on its loans designated as hedges of net investments of $ 29 million.

During the year ended December 31, 2022, the Company had a translation loss of $ 188 million and a gain on its loans designated as hedges of net investments of $ 32 million.

Foreign currency gains and losses arising from transactions denominated in a currency other than the functional currency of the entity involved are included within Other expense (income), net in the Consolidated Statements of Operations.

During the years ended December 31, 2023, 2022, and 2021, the Company had a net foreign currency gain of $ 3 million, loss of $ 6 million and gain of $ 12 million, respectively.

Foreign currency gains and losses arising from transactions denominated in a currency other than the functional currency of the entity involved are included within Other (income) expense, net in the Consolidated Statements of Operations.

During the years ended December 31, 2024, 2023, and 2022, the Company had a net foreign currency gain of $ 21 million, gain of $ 3 million, and loss of $ 6 million, respectively.

Revenue Recognition

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Revenue is recognized when performance obligations under the terms of a contract with a customer are satisfied;

this occurs with the transfer of control of products and services to its customers, which for products generally occurs when title and risk of loss transfers to the customer, and for services generally occurs as the customer receives and consumes the benefit.

this occurs with the transfer of control of products and services to the Company’s customers, which for products generally occurs when title and risk of loss transfers to the customer, and for services generally occurs as the customer receives and consumes the benefit.

Sales, value-added, and other taxes collected concurrent with revenue-producing activities are excluded from revenue.

Certain contracts with our customers include promises to transfer multiple products and services to a customer.

Certain contracts with the Company’s customers include promises to transfer multiple products and services to a customer.

Determining whether products and services are considered distinct performance obligations that should be accounted for separately may require significant judgment.

The Company generally uses an observable price, typically average selling price, to determine the stand-alone selling price for separate performance obligations.

The Company determines the stand-alone selling price, based on Company geographic sales locations’ database of pricing and discounting practices for the specific product or service when sold separately, and utilizes this data to arrive at average selling prices by product.

The Company determines the stand-alone selling prices based on its database of pricing and discounting practices from among the Company’s varied geographic sales locations and for specific products or services when sold separately, and the Company utilizes this data to arrive at average selling prices by product.

In cases where an average selling price is not observable, the Company determines the stand-alone selling price using relevant information and applies suitable estimation methods including, but not limited to, the cost plus a margin approach.

Revenue is then allocated proportionately, based on the determined stand-alone selling price, to each distinct performance obligation.

The Company exercises judgment in estimating variable consideration, which primarily includes volume discounts, sales rebates, and product returns.

The Company exercises judgment in estimating variable consideration, which primarily includes volume discounts, sales rebates, product returns, and certain extended warranty arrangements.

The Company adjusts the estimate of revenue at the earlier of when the most likely amount of consideration can be estimated, the amount expected to be received changes, or when the consideration becomes fixed.

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For contracts with customers that contain destination shipping terms, revenue is not recognized until the goods are delivered to the agreed-upon destination.

As such, the Company’s performance obligations related to product sales are satisfied at a point in time as this is when the customer obtains the use of and substantially all of the benefit of the product.

The Company recognizes revenue from support and maintenance contracts, extended warranties, and other certain contract performance obligations over time based on the period of the contracts or as the services are performed, as the customer simultaneously receives and consumes the benefits provided by the Company’s performance of the services.

As such, the Company’s performance obligations related to product sales are satisfied at a point in time when customers obtain the use of, and substantially all of the benefit of, the products.

The Company recognizes revenue from support and maintenance contracts, extended warranties, and certain other contract performance obligations over time based on the period of the contracts or as the services are performed, as the customer simultaneously receives and consumes the benefits provided by the Company’s performance of the services.

In general, the total amount of revenue recognized over time is not material to the Company’s financial statements.

Depending on the terms of its contracts, the Company may defer the recognition of a portion of revenue on a relative stand-alone selling price basis when certain performance obligations are not yet satisfied.

Depending on the terms of its contracts, the Company defers the recognition of a portion of revenue on a relative stand-alone selling price basis when certain performance obligations are not yet satisfied.

Consideration received from customers in advance of revenue recognition is classified as deferred revenue.

For certain locations, the Company offers a loyalty points program to customers.

A portion of the revenue generated in a sale is allocated to the loyalty points earned and is deferred until the loyalty points are redeemed or expire.

The Company has elected to account for shipping and handling activities as a fulfillment cost within the cost of products sold, and records shipping and handling costs collected from customers in net sales.

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relief from considering the existence of a significant financing component when the payment for the good or service is expected to be one year or less.

Additional information and disclosure regarding revenue recognition is provided in Note 2, Revenue.

See Note 2, Revenue Recognition for additional information.

Cost of Products Sold

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Selling, General and Administrative Expenses

SG&A represents indirect costs associated with generating revenues and in managing the business of the Company.

SG&A represents indirect costs associated with generating revenues and managing the operations of the Company.

Such costs include advertising and marketing expenses, salaries, employee benefits, incentive compensation, travel, office expenses, lease costs, amortization of capitalized software developed for internal use, and depreciation of administrative facilities.

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Research and Development Costs

R&D costs, including internal labor costs, material costs, consulting expenses, and certain overheads, such as facilities and information technology costs directly attributable to R&D activities, are expensed in the period in which they are incurred.

Software development costs related to software to be sold, leased, or otherwise marketed incurred prior to the attainment of technological feasibility are considered R&D and are expensed as incurred.

R&D costs, including internal labor costs, material costs, consulting expenses, and certain overhead expenses, such as facilities and information technology costs directly attributable to R&D activities, are expensed in the period in which they are incurred.

Software development costs related to software to be sold, leased, or otherwise marketed that are incurred prior to the attainment of technological feasibility are considered R&D and are expensed as incurred.

Once technological feasibility is established, the cost of software developed for external use is capitalized until the product is available for general release to customers.

Amortization of these costs are included in Cost of products sold over the estimated life of the products.

Stock Compensation

Stock-Based Compensation

Stock-based compensation is measured at the grant date at fair value, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity awards).

The compensation cost is only recognized for the portion of the awards that are expected to vest.

Stock options granted become exercisable as determined by the grant agreement and expire ten years after the date of grant under these plans.

Restricted Stock Units (“RSU”) vest as determined by the grant agreement and are subject to a service condition, which requires grantees to remain employed by the Company during the period following the date of grant.

Stock options granted become exercisable as determined by the grant agreement and expire ten years after the date of grant under the Company’s stock-based compensation plans.

Restricted Stock Units (“RSUs”) vest as determined by the grant agreement and are subject to a service condition, which requires grantees to remain employed by the Company during the period following the date of grant.

Under the terms of the RSUs, the vesting period is referred to as the restricted period.

In addition to the service condition, certain granted RSUs are subject to performance requirements that can vary between the first year and up to the final year of the RSU award.

If targeted performance is not met the RSU granted is adjusted to reflect the achievement level.

Upon the expiration of the applicable restricted period and the satisfaction of all conditions imposed, the restrictions on RSUs will lapse, and shares of common stock will be issued as payment for each vested RSU.

Upon death, disability or qualified retirement all awards become immediately exercisable for up to one year .

In addition to the service condition, certain RSUs are subject to performance requirements that can vary between the first year and the final year of the RSU award.

For a given RSU award which is subject to performance requirements, the number of shares which vest may be adjusted upward or downward from the target amount to reflect the achievement level.

Upon the expiration of the applicable restricted period and the satisfaction of any applicable performance conditions imposed, the restrictions on RSUs will lapse, and shares of common stock will be issued for each vested RSU.

Upon death, disability or qualified retirement, awards continue to vest per the remaining grant term and are pro-rated if the grant date is less than twelve months from the date of separation.

Awards are expensed as compensation over their respective vesting periods or to the eligible retirement date if shorter.

The Company records forfeitures on stock-based compensation as the participant terminates rather than estimating forfeitures.

The Company’s tax expense includes U.S.

The Company’s income tax expense or benefit includes U.S.

and international income taxes plus the provision for U.S.

taxes on undistributed earnings of international subsidiaries not considered to be permanently invested.

Tax credits and other incentives reduce tax expense in the year the credits are claimed.

income taxes on undistributed earnings of international subsidiaries not considered to be permanently reinvested.

Tax credits and other incentives reduce income tax expense in the year the credits are claimed.

Certain items of income and expense are not reported in tax returns and financial statements in the same year.

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The Company applies a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.

The Company recognizes in the consolidated financial statements the impact of a tax position if that position is more likely than not of being sustained upon examination by the taxing authorities based on the technical merits of the position.

The Company’s tax positions are subject to ongoing examinations by the tax authorities.

The Company recognizes in the consolidated financial statements the impact of a tax position if that position is more likely than not to be sustained upon examination by taxing authorities based on the technical merits of the position.

The Company’s tax positions are subject to ongoing examinations by tax authorities.

The Company operates within multiple taxing jurisdictions throughout the world and in the normal course of business is examined by taxing authorities in those jurisdictions.

Adjustments to the uncertain tax positions are recorded when taxing authority examinations are completed, statutes of limitation are closed, changes in tax laws occur or as new information comes to light regarding to the technical merits of the tax position.

Adjustments to uncertain tax positions are recorded when taxing authority examinations are completed, statutes of limitation are closed, changes in tax laws occur or as new information comes to light regarding the technical merits of a given tax position.

Earnings Per Share

Basic earnings per share are calculated by dividing net earnings attributable to the Company’s shareholders by the weighted average number of shares outstanding for the period.

Diluted earnings per share is calculated by dividing net earnings attributable to the Company’s shareholders by the weighted average number of shares outstanding for the period, adjusted for the effect of an assumed exercise of all dilutive options outstanding at the end of the period, unless the impact of including these options is anti-dilutive.

Business Acquisitions

The Company acquires businesses as well as partial interests in businesses.

Acquired businesses are accounted for using the acquisition method of accounting which requires the Company to record assets acquired and liabilities assumed at their respective fair values with the excess of the purchase price over estimated fair values recorded as goodwill.

The Company obtains information during due diligence and through other sources to establish respective fair values.

Examples of factors and information that the Company uses to determine the fair values include:

tangible and intangible asset valuations and appraisals, and evaluations of existing contingencies, liabilities, and product line information.

If the initial valuation for an acquisition is incomplete by the end of the reporting period in which the acquisition occurred, the Company will record provisional estimates in the financial statements.

The provisional estimates will be finalized as soon as information becomes available, but not later than one year from the acquisition date.

As part of purchase accounting for acquisitions, the Company values identified intangible assets using an income approach.

Technology know-how is valued using an excess earnings method.

Tradename and trademark assets are valued using a relief-from-royalty method.

Non-compete agreements are valued using a with-and-without method.

The Company applies judgment in estimating the fair value of intangible assets acquired, which involves the use of estimates and assumptions with respect to revenue growth rates, EBITDA margin percentages, royalty rate, technology obsolescence factors, useful lives of the assets and discount rates used in computing present values.

In addition, the estimates of useful lives of these acquired intangibles are used to calculate depreciation and amortization expense.

For the year ended December 31, 2021, the Company incurred acquisition-related costs of $ 8 million, consisting primarily of legal and professional fees, which were recorded in SG&A expenses in the Consolidated Statements of Operations.

These costs were not material for the years ended December 31, 2023 and 2022.

Basic earnings per share are calculated by dividing net earnings attributable to the Company’s stockholders by the weighted average number of shares outstanding for the period.

Diluted earnings per share is calculated by dividing net earnings attributable to the Company’s stockholders by the weighted average number of shares outstanding for the period, adjusted for the effect of an assumed exercise of all dilutive options outstanding at the end of the period, unless the impact of including these options is anti-dilutive.

Investments in Unconsolidated Affiliates

Investments in non-consolidated affiliates, joint ventures, and partnerships where the Company maintains significant influence over an entity but does not have control are accounted for using the equity method.

The Company records the carrying value of these investments within other noncurrent assets in the Consolidated Balance Sheets and records the Company’s proportional share of the investees’ net earnings or losses within other expense (income).

Investments in which the Company does not exercise significant influence are recorded at cost, and assessed for any other-than-temporary impairment when events or changes in circumstances indicate the carrying amount of the investment might not be recoverable.

On December 7, 2023, the Company sold its minority interest in a UK-based, privately-held provider of healthcare consumables for $ 13 million.

Prior to the sale, the Company recorded a loss of $ 4 million in Other expense (income), net due to a forfeiture of accumulated earnings on the investment for declining its option to purchase the remaining ownership interest.

The Company's equity-method net losses were $ 4 million, $ 36 million, and $ 10 million for the years ended December 31, 2023, 2022, and 2021 respectively.

Loss from equity method investments for the year ended December 31, 2022 includes $ 36 million recorded in Other expense (income), net in the Consolidated Statements of Operations for a write-off of the Company’s ownership position in a privately-held dental investment company following impairment of underlying investments held by the investment company and the Company’s determination that the remaining investment is not recoverable.

Prior to the sale, the Company recorded a loss of $ 4 million in Other (income) expense, net due to a forfeiture of accumulated earnings on the investment for declining its option to purchase the remaining ownership interest.

The Company’s equity-method net loss for the year ended December 31, 2024 was no t significant.

The Company’s equity-method net losses for the years ended December 31, 2023 and 2022 were $ 4 million and $ 36 million, respectively.

Loss from equity method investments for the year ended December 31, 2022 includes $ 36 million recorded in Other (income) expense, net in the Consolidated Statements of Operations for a write-off of the Company’s ownership position in a privately-held dental investment company following impairment of underlying investments held by the investment company and the Company’s determination that the remaining investment is not recoverable.

Noncontrolling Interests

The Company reports noncontrolling interest (“NCI”) in a subsidiary as a separate component of Equity in the Consolidated Balance Sheets.

Additionally, the Company reports the portion of net income (loss) and comprehensive income (loss) attributed to the Company and NCI separately in the Consolidated Statements of Operations, and in the Consolidated Statements of Comprehensive Income.

Segment Reporting

The Company has numerous operating businesses covering a wide range of products and geographic regions, primarily serving the professional dental market and to a lesser extent the consumable medical device market.

The Company has four reportable segments and a description of the activities within these segments is included in Note 6, Segment and Geographic Information.

Additionally, the Company reports the portion of net loss and comprehensive loss attributed to the Company and NCI separately in the Consolidated Statements of Operations, and in the Consolidated Statements of Comprehensive Income.

Fair Value Measurement

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The Company records certain financial assets and liabilities at fair value in accordance with the accounting guidance, which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date in current markets.

The accounting guidance establishes a hierarchical disclosure framework associated with the level of pricing observability utilized in measuring financial instruments at fair value.

The accounting guidance establishes a hierarchical disclosure framework associated with the level of observable pricing utilized in measuring financial instruments at fair value.

The three broad levels defined by the fair value hierarchy are as follows:

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These financial instruments include derivative instruments whose fair value have been derived using a model where inputs to the model are directly observable in the market or can be derived principally from, or corroborated by, observable market data.

Level 3 - Instruments that have little to no pricing observability as of the reported date.

Level 3 - Instruments that have little to no observable pricing as of the reported date.

These financial instruments do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation.

The degree of judgment utilized in measuring the fair value of certain financial assets and liabilities generally correlates to the level of pricing observability.

Pricing observability is impacted by a number of factors, including the type of financial instrument.

The degree of judgment utilized in measuring the fair value of certain financial assets and liabilities generally correlates to the level of observable pricing.

Observable pricing is impacted by a number of factors, including the type of financial instrument.

Financial assets and liabilities with readily available active quoted prices or for which fair value can be measured from actively quoted prices generally will have a higher degree of pricing observability and a lesser degree of judgment utilized in measuring fair value.

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The Company believes the carrying amounts of cash and cash equivalents, accounts receivable (net of allowance for doubtful accounts), prepaid expenses and other current assets, accounts payable, accrued liabilities, income taxes payable and notes payable approximate fair value due to the short-term nature of these instruments.

The Company has presented the required disclosures in Note 20, Fair Value Measurement.

See Note 20, Fair Value Measurement for additional information.

Non-Recurring Basis

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Recently Adopted Accounting Pronouncements

In October 2021, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2021-08, “Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers,” which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers , as if it had originated the contracts.

The new standard requirement to measure contract assets and contract liabilities acquired in a business combination at fair value differs from the current approach.

The amendments in this update were effective for the fiscal years and interim periods ending after December 31, 2022.

The Company adopted this accounting standard on January 1, 2023.

The adoption of this standard did not materially impact the Company’s consolidated financial statements or related disclosures.

Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued ASU No.

2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures”, which requires public entities to disclose information about significant expenses in their reportable segment results on both an interim and annual basis.

Public entities are required to disclose significant expense categories and amounts for each reportable segment.

Improvements to Reportable Segment Disclosures,” which requires disclosure of information about significant expenses in a public company’s reportable segment results on both an interim and annual basis.

Public companies are required to disclose significant expense categories and amounts for each reportable segment.

Significant expense categories are derived from expenses that are regularly reported to an entity’s chief operating decision-maker (“CODM”) and included in a segment’s reported measures of profit or loss.

Public entities are also required to disclose the title and position of the CODM and explain how the CODM uses the reported measures of profit or loss to assess segment performance.

This standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, early adoption is permitted and should be applied retrospectively for all prior periods presented in the consolidated financial statements.

The Company is currently evaluating the impact on its consolidated financial statements and related disclosures.

This standard was effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company has adopted this accounting standard, and the related disclosures are included in Note 6, Segment and Geographic Information in the Notes to Consolidated Financial Statements in Item 8 of this Form 10-K.

Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU No.

2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures”, which requires public entities to disclose additional income tax information, primarily related to the rate reconciliation and income taxes paid on an annual basis.

The amendment in the ASU is intended to enhance the transparency and decision usefulness of income tax disclosures.

The amendments in this update are effective for annual periods beginning after December 15, 2024, early adoption is permitted and should be applied prospectively.

Improvements to Income Tax Disclosures,” which requires public entities to disclose additional income tax information, primarily related to the income tax rate reconciliation and income taxes paid on an annual basis.

The amendments are intended to enhance the transparency and decision-usefulness of income tax disclosures and are effective as of January 1, 2025.

Early adoption is permitted and should be applied prospectively.

The Company expects this ASU to only impact the Company’s disclosures with no impacts to results of operations, financial position, or cash flows.

In November 2024, the FASB issued ASU No.

2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses,” which requires disaggregated disclosure of income statement expenses for public business entities (“PBEs”).

In January 2025, the FASB issued ASU No.

2025-01 “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40),” which clarified the effective date for ASU No.

These amendments are intended to provide more information about types of expenses in commonly presented expense captions.

The amendments in this update are effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, and early adoption is permitted.

The Company is currently evaluating the impact on its consolidated financial statements and related disclosures.

NOTE 2 - REVENUE

Revenues are derived primarily from the sale of dental equipment and dental and healthcare consumables products.

In November 2024, the FASB issued ASU No.

2024-04, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) Induced Conversions of Convertible Debt Instruments,” which amends ASC 470-202 to clarify the requirements related to accounting for the settlement of a debt instrument as an induced conversion.

The amendments in this update are effective for annual periods beginning after December 15, 2025, and interim periods within those annual reporting periods, and early adoption is permitted if the entity has also adopted ASU 2020-06 “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40)” for that period.

The Company is currently evaluating the impact on its consolidated financial statements and related disclosures.

NOTE 2 - REVENUE RECOGNITION

Revenues are derived primarily from the sale of dental equipment and dental and healthcare consumable products.

Revenues are measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services.

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Contract Assets and Liabilities

The Company generally does not have contract assets in the course of its business.

Contract liabilities, which represent billings in excess of revenue recognized, are primarily related to advanced billings for customer aligner treatment where the performance obligation has not yet been fulfilled.

The Company had deferred revenue of $ 91 million and $ 57 million recorded in Accrued liabilities and Other noncurrent liabilities, respectively, in the Consolidated Balance Sheets at December 31, 2023.

The Company had deferred revenue of $ 91 million and $ 27 million recorded in Accrued liabilities and Other noncurrent liabilities, respectively, in the Consolidated Balance Sheets at December 31, 2022.

The Company recognized $ 68 million of revenue during the twelve months ended December 31, 2023 which was previously deferred as of December 31, 2022.

The Company recognized $ 59 million of revenue during the the twelve months ended December 31, 2022 which was previously deferred as of December 31, 2021.

The Company expects to recognize a significant majority of the deferred revenue within the next twelve months.

The Company does not typically have contract assets in the course of its business.

Contract liabilities, which represent billings in excess of revenue recognized, are primarily related to advanced billings for customer orthodontic treatments where the performance obligation has not yet been satisfied, and deferred revenue associated with loyalty points earned but not yet redeemed by customers under the Company’s loyalty point program.

The Company had deferred revenue of $ 95 million and $ 49 million presented in Accrued liabilities and Other noncurrent liabilities, respectively, in the Consolidated Balance Sheets at December 31, 2024.

The Company recorded deferred revenue of $ 91 million and $ 57 million presented in Accrued liabilities and Other noncurrent liabilities, respectively, in the Consolidated Balance Sheets at December 31, 2023.

The Company recognized $ 79 million of revenue for the year ended December 31, 2024 which was previously deferred as of December 31, 2023.

The amount recognized in the year ended December 31, 2024 includes a $ 9 million reduction in revenue for a refund reserve related to the realignment of the Byte aligner business as described in Note 18, Restructuring and Other Costs.

The Company recognized $ 68 million of revenue for the year ended December 31, 2023 which was previously deferred as of December 31, 2022.

The Company expects to recognize most of the remaining deferred revenue in net sales within the next twelve months.

Allowance for Doubtful Accounts

Accounts and notes receivable-trade, net are stated net of allowances for doubtful accounts and trade discounts, which were $ 14 million and $ 17 million at December 31, 2024 and 2023, respectively.

For the years ended December 31, 2023 and 2022, changes to the provision for doubtful accounts including write-offs of accounts receivable that were previously reserved were insignificant.

Changes to this provision are included in Selling, general, and administrative expenses in the Consolidated Statements of Operations.

For the years ended December 31, 2024 and 2023, changes to the allowance for doubtful accounts, including write-offs of accounts receivable that were previously reserved, were not significant.

Changes to the allowance for doubtful accounts are presented in Selling, general, and administrative expenses in the Consolidated Statements of Operations.

NOTE 3 - STOCK COMPENSATION

The Company maintains the 2016 Omnibus Incentive Plan (the “Plan”) under which it may grant non-qualified stock options (“NQSOs”), incentive stock options, restricted stock, RSUs and stock appreciation rights, collectively referred to as “Awards.” Awards are granted at exercise prices that are equal to the closing stock price on the date of grant.

The Company authorized grants under the Plan of 25 million shares of common stock, plus any unexercised portion of canceled or terminated stock options granted under the legacy DENTSPLY International Inc.

2010 and 2002 Equity Incentive Plans, as amended, and under the legacy Sirona Dental Systems, Inc.

2015 and 2006 Equity Incentive Plans, as amended.

Each restricted stock and RSU issued is counted as a reduction of 3.09 shares of common stock available to be issued under the Plan.

No key employee may be granted awards in excess of 1 million shares of common stock in any calendar year.

The Company maintains the 2024 Omnibus Incentive Plan (the “Plan”), which was approved by the Company’s stockholders on May 22, 2024 (the “Effective Date”).

The Company’s stockholders previously approved the 2016 Omnibus Incentive Plan (the “Prior Plan”).

After the Effective Date, no new awards may be granted under the Prior Plan, although awards granted under the Prior Plan prior to the Effective Date remain outstanding and remain subject to the terms and conditions of, and continue to be governed by, the Prior Plan.

Under the Plan, the Company may grant stock options, share appreciation rights, restricted shares, restricted share units, share bonuses, other share-based awards, or cash awards, collectively referred to as “Awards.” The Company’s non-qualified stock options (“NQSOs”) are granted at exercise prices that are at least equal to the closing stock price on the date of grant.

Under the Plan, 14.5 million shares are initially available for Awards, less (i) one share for every one share that was subject to an option or share appreciation right granted after March 26, 2024 under the Prior Plan and (ii) 2.7 shares for every one share that was subject to an award other than an option or share appreciation right granted after March 26, 2024 under the Prior Plan (such adjusted amount, the “Share Pool”).

Under the Plan, any shares that are subject to options or share appreciation rights shall be counted against the Share Pool as one share for every one share granted, and any shares that are subject to awards other than options or share appreciation rights shall be counted against the Share Pool as 2.7 shares for every one share granted.

Shares granted under either the Plan or the Prior Plan which are cancelled or forfeited are added back to the count of shares available for Awards.

The number of shares available for grant under the Plan at December 31, 2024 is 16 million.

The amounts of stock compensation expense recorded in the Company’s Consolidated Statements of Operations for the years ended December 31, 2023, 2022 and 2021 were as follows:

The amounts of stock-based compensation expense recorded in the Company’s Consolidated Statements of Operations were as follows:

Year Ended December 31,

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2024 2023 2022

Weighted average fair value per share $ 12.64 $ 14.06 $ 15.90

Weighted average fair value per NQSO $ 9.91 $ 12.64 $ 14.06

Expected dividend yield 1.92 % 1.45 % 1.09 %

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Expected life (years) 4.26 4.76 5.20

The total intrinsic value of options exercised for the year ended December 31, 2023 was insignificant.

The total intrinsic value of options exercised for the years ended December 31, 2022 and 2021 was $ 1 million and $ 16 million, respectively.

The total intrinsic value of NQSOs exercised for the years ended December 31, 2024 and 2023 was insignificant.

The total intrinsic value of options exercised for the year ended December 31, 2022 was $ 1 million.

The NQSO transactions for the year ended December 31, 2024 were as follows:

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The weighted average remaining contractual term of all outstanding options, exercisable options, and options expected to vest are 5.2 years, 3.9 years and 7.4 years, respectively.

Information about NQSOs outstanding for the year ended December 31, 2023 were as follows:

Information about NQSOs outstanding as of December 31, 2024 is provided below:

Outstanding Exercisable

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50.01 - 60.00 0.2 1.90 62.43 0.2 62.43

The unvested RSU transactions for the year ended December 31, 2023 were as follows:

The unvested RSUs for the year ended December 31, 2024 were as follows:

Unvested Restricted Stock Units

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The total fair value of shares vested for the years ended December 31, 2024, 2023 and 2022 was $ 46 million, $ 42 million and $ 49 million, respectively.

NOTE 4 - EARNINGS PER COMMON SHARE

The computation of basic and diluted earnings (loss) per common share for the years ended December 31 were as follows:

Basic Earnings (Loss) Per Common Share

NOTE 4 - LOSS PER COMMON SHARE

The computations of basic and diluted loss per common share were as follows:

Basic Loss Per Common Share

Year Ended December 31,

(in millions, except per share amounts) 2024 2023 2022

Net (loss) income attributable to Dentsply Sirona $ ( 132 ) $ ( 950 ) $ 411

Net loss attributable to Dentsply Sirona $ ( 910 ) $ ( 132 ) $ ( 950 )

Weighted average common shares outstanding 203.2 212.0 215.5

Earnings (loss) per common share - basic $ ( 0.62 ) $ ( 4.41 ) $ 1.88

Diluted Earnings (Loss) Per Common Share

Basic loss per common share $ ( 4.48 ) $ ( 0.62 ) $ ( 4.41 )

Diluted Loss Per Common Share

Year Ended December 31,

(in millions, except per share amounts) 2024 2023 2022

Net (loss) income attributable to Dentsply Sirona $ ( 132 ) $ ( 950 ) $ 411

Net loss attributable to Dentsply Sirona $ ( 910 ) $ ( 132 ) $ ( 950 )

Weighted average common shares outstanding 203.2 212.0 215.5

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Total weighted average diluted shares outstanding 203.2 212.0 215.5

Earnings (loss) per common share - diluted $ ( 0.62 ) $ ( 4.41 ) $ 1.87

Diluted loss per common share $ ( 4.48 ) $ ( 0.62 ) $ ( 4.41 )

Weighted average shares excluded from diluted common shares outstanding due to reported net loss 0.6 1.1 0.5

Weighted average shares excluded from diluted common shares outstanding due to antidilutive nature 3.7 3.0 3.6

NOTE 5 - COMPREHENSIVE (LOSS) INCOME

AOCI includes cumulative foreign currency translation adjustments related to consolidation of the Company’s foreign subsidiaries, fair value adjustments related to the Company’s derivative financial instruments, and actuarial gains and losses related to the Company’s pension plans.

NOTE 5 - COMPREHENSIVE LOSS

Accumulated Other Comprehensive Income (“AOCI”) includes cumulative foreign currency translation adjustments related to consolidation of the Company’s foreign subsidiaries, fair value adjustments related to the Company’s derivative financial instruments, and actuarial gains and losses related to the Company’s pension plans.

These changes are recorded in AOCI, net of tax.

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Changes in AOCI, net of tax, by component for the years ended December 31, 2024 and 2023 were as follows:

(in millions) Foreign Currency Translation Gain (Loss) Gain (Loss) on Cash Flow Hedges Gain (Loss) on Net Investment and Fair Value Hedges Pension Liability Gain (Loss) Total

(in millions) Foreign Currency Translation Loss (Loss) Gain on Cash Flow Hedges (Loss) Gain on Net Investment and Fair Value Hedges Pension Liability (Loss) Gain Total

Balance, net of tax, at December 31, 2023 $ ( 473 ) $ ( 13 ) $ ( 107 ) $ ( 43 ) $ ( 636 )

Other comprehensive income (loss) before reclassifications and tax impact 2 — ( 45 ) ( 34 ) ( 77 )

Other comprehensive income (loss), net of tax, before reclassifications $ 49 $ — $ ( 34 ) $ ( 26 ) $ ( 11 )

Other comprehensive (loss) income before reclassifications and tax impact ( 113 ) — 48 15 ( 50 )

( 33 ) — ( 11 ) ( 4 ) ( 48 )

Other comprehensive (loss) income, net of tax, before reclassifications $ ( 146 ) $ — $ 37 $ 11 $ ( 98 )

Amounts reclassified from accumulated other comprehensive income, net of tax — 3 — 1 4

Net increase (decrease) in other comprehensive income 49 4 ( 34 ) ( 27 ) ( 8 )

Net (decrease) increase in other comprehensive income ( 146 ) 3 37 12 ( 94 )

Balance, net of tax, at December 31, 2024 $ ( 619 ) $ ( 10 ) $ ( 70 ) $ ( 31 ) $ ( 730 )

(in millions) Foreign Currency Translation Gain (Loss) Gain (Loss) on Cash Flow Hedges Gain (Loss) on Net Investment and Fair Value Hedges Pension Liability Gain (Loss) Total

(in millions) Foreign Currency Translation (Loss) Gain (Loss) Gain on Cash Flow Hedges (Loss) Gain on Net Investment and Fair Value Hedges Pension Liability (Loss) Gain Total

Balance, net of tax, at December 31, 2022 $ ( 522 ) $ ( 17 ) $ ( 73 ) $ ( 16 ) $ ( 628 )

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(in millions) 2024 2023 2022

Gain (Loss) on derivative financial instruments:

(Loss) Gain on derivative financial instruments:

Interest rate swaps $ ( 3 ) $ ( 3 ) $ ( 3 ) Interest expense, net

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Net loss before tax $ ( 3 ) $ ( 4 ) $ —

Tax impact — — — (Benefit) provision for income taxes

Tax impact — — — Benefit from income taxes

Net loss after tax $ ( 3 ) $ ( 4 ) $ —

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$ 1 $ 1 $ ( 7 )

Tax impact — 2 3 (Benefit) provision for income taxes

Tax impact — — 2 Benefit from income taxes

Net income (loss) after tax

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NOTE 6 - SEGMENT AND GEOGRAPHIC INFORMATION

Effective April 1, 2023 the Company realigned its reporting structure due to certain organizational changes.

The Company realigned its reportable segments to reflect changes in how the Company manages its operations, specifically the level at which its chief operating decision maker (“CODM”) regularly reviews operating results and allocates resources.

As a result, the reportable segments changed from Technology & Equipment and Consumables to (i) Connected Technology Solutions, (ii) Essential Dental Solutions, (iii) Orthodontic and Implant Solutions, and (iv) Wellspect Healthcare.

The Company has four operating segments that are organized primarily by product.

They generally have overlapping geographical presence, customer bases, distribution channels, and regulatory oversight with the exception of Wellspect Healthcare, which has a more discrete market and regulatory environment specific to the industry for medical devices.

These operating segments which also form the Company’s reportable segments, are identified in accordance with how the Company’s CODM regularly reviews financial results and uses this information to evaluate the Company’s performance and allocate resources.

The Company evaluates performance of the segments based on the net sales and adjusted operating income.

Segment adjusted operating income is defined as operating income before income taxes and before certain corporate headquarters unallocated costs, goodwill and intangible asset impairments, restructuring and other costs, interest expense, net, other expense (income), net, amortization of intangible assets and depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations.

Asset and other balance sheet information are not reported to the CODM.

The Company has four operating segments, organized primarily by product, which are also the Company’s reportable segments.

These are (i) Connected Technology Solutions, (ii) Essential Dental Solutions, (iii) Orthodontic and Implant Solutions, and (iv) Wellspect Healthcare.

These operating segments, which also form the Company’s reportable segments, are identified in accordance with how the Company’s chief operating decision maker (“CODM”) regularly reviews financial results and uses this information to evaluate the Company’s performance and allocate resources.

The Company’s CODM is the Chief Executive Officer.

The CODM assesses performance of the segments based on the net sales and adjusted operating income.

Segment adjusted operating income is defined as operating income before income taxes and before certain unallocated corporate costs, interest expense, net, other (income) expense, net, goodwill and intangible asset impairments, restructuring and other costs, amortization of intangible assets, other acquisition costs, and depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations.

Asset and other balance sheet information is not reported to the CODM.

The CODM uses both net sales and segment adjusted operating income for each segment during development of the annual operating plan and the regular forecasting process.

Additionally, the CODM considers budget-to-actual variances for these measures on a quarterly basis as well as segment-specific forecasting when making decisions about the allocation of operating and capital resources to each segment.

A description of the products and services provided within each of the Company’s four reportable segments is provided below.

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This product group also includes other lab equipment, such as amalgamators, mixing machines and porcelain furnaces.

Dental CAD/CAM technologies are products designed for dental offices to support numerous digital workflows for procedures such as dental restorations through integrations with DS Core, our cloud-based platform.

This product category includes intraoral scanners, 3-D printers, mills, and certain software and services, as well as a full-chairside economical restoration of esthetic ceramic dentistry offering called CEREC.

A full-chairside offering enables dentists to practice same day or single visit dentistry.

Dental CAD/CAM technologies are products designed for dental professionals to support numerous digital workflows for procedures such as dental restorations through integrations with DS Core, our cloud-based platform.

Essential Dental Solutions

This segment includes the development, manufacture and sales of the Company’s value-added endodontic, restorative, and preventive consumable products and small equipment used in dental offices for the treatment of patients.

Offerings in this segment also include specialized treatment products including products used in the creation of dental appliances.

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Offerings in this segment also include application of our digital services and technology, including those provided by DS Core, our cloud-based platform.

The Orthodontics product category includes SureSmile, an aligner solution provided through clinician offices, and Byte, a direct-to-consumer aligner solution.

The Orthodontics product category also includes a High Frequency Vibration technology device known as VPro or as HyperByte within Byte’s product offering, as well as the new SureSmile Simulator which uses intraoral scanners and our DS Core platform to create a 3D visualization of patient outcomes.

SureSmile aligner solutions include whitening kits and retainers.

Byte aligner solutions include Byte Plus with in-office intraoral scanning for treatment planning.

The aligner offerings also include software technology that enables aligner treatment planning and seamless connectivity of a digital workflow from diagnostics through treatment delivery.

The Orthodontics product category includes SureSmile, a clear aligner solution provided through clinician offices, and Byte, a direct-to-consumer clear aligner solution.

The Orthodontics product category includes a High Frequency Vibration technology device known as VPro, as well as the SureSmile Simulator which uses intraoral scanners and our DS Core platform to create a 3D visualization of patient outcomes and SureSmile aligner solutions, which include whitening kits and retainers.

The aligner offerings also include software technology that enables aligner treatment planning and the seamless connectivity of a digital workflow from diagnostics through treatment delivery.

Byte operations were significantly reduced after October 24, 2024 and limited to supporting patients already undergoing treatment, following a decision to voluntarily suspend sales and marketing of Byte aligners and impression kits.

In January 2025, the Company subsequently announced it will no longer offer the Byte direct-to-consumer clear aligner solution and has decided to leverage technologies developed by Byte elsewhere in the aligners portfolio to create orthodontic demand, support a digital clinical workflow, enhance the customer experience, and improve patient monitoring.

Implants & Prosthetics

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This segment includes the design, manufacture, and sales of the Company’s innovative continence care solutions for both urinary and bowel management.

This category consists mainly of urology catheters and other healthcare-related consumable products.

The Company’s segment information for the years ended December 31 was as follows:

Net Sales Year Ended December 31,

(in millions) 2023 2022 2021

Connected Technology Solutions $ 1,169 $ 1,219 $ 1,348

Essential Dental Solutions 1,468 1,427 1,516

Orthodontic and Implant Solutions 1,040 1,006 1,064

Wellspect Healthcare 288 270 303

Total net sales $ 3,965 $ 3,922 $ 4,231

Wellspect Healthcare is a leading global provider of innovative medical devices that help people suffering from urinary retention or chronic constipation.

Wellspect is one of the world’s leading manufacturers of intermittent urinary catheters, with LoFric as the most known brand.

To help those with chronic or severe constipation, Wellspect also offers an advanced irrigation system, Navina, which combines a high degree of user convenience, clinical effectiveness and connectivity into one smart system.

The Company’s segment financial information was as follows:

Year Ended December 31,

(in millions) Connected Technology Solutions Essential Dental Solutions Orthodontic and Implant Solutions Wellspect Healthcare Total

Net sales 1,062 1,454 973 304 3,793

Adjusted cost of products sold (a)

602 565 407 117

Adjusted selling expenses (b)

242 313 301 52

Adjusted G&A expenses (b)

Adjusted R&D expenses (c)

Segment adjusted operating income 70 479 80 98 727

Reconciling items (income) expense:

Unallocated corporate costs (d)

Interest expense, net 69

Other (income) expense, net ( 12 )

Goodwill and intangible asset impairments 1,014

Restructuring and other costs 53

Amortization of intangibles 216

Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations 3

Loss before income taxes ( 936 )

(a) Adjusted cost of products sold represents expenses adjusted to exclude intangible amortization expense, step-up depreciation expense, and other restructuring costs.

(b) Adjusted selling and adjusted G&A expenses represent expenses adjusted to exclude intangible amortization expense, other acquisition costs, step-up depreciation expense, and other restructuring costs.

(d) Unallocated corporate costs consist of general corporate expenses including corporate headcount costs, depreciation and amortization, unallocated professional service fees, and other operating costs which are not assigned to a specific segment.

Year Ended December 31,

(in millions) Connected Technology Solutions Essential Dental Solutions Orthodontic and Implant Solutions Wellspect Healthcare Total

Net sales 1,169 1,468 1,040 288 3,965

Adjusted cost of products sold (a)

645 560 402 114

Adjusted selling expenses (b)

264 313 305 51

Adjusted G&A expenses (b)

Adjusted R&D expenses (c)

Segment adjusted operating income 101 478 156 87 822

Reconciling items (income) expense:

Unallocated corporate costs (d)

Interest expense, net 81

Other (income) expense, net 9

Goodwill and intangible asset impairments 307

Restructuring and other costs 67

Amortization of intangibles 211

Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations 3

Loss before income taxes ( 175 )

(a) Adjusted cost of products sold represents expenses adjusted to exclude intangible amortization expense, step-up depreciation expense, and other restructuring costs.

Year Ended December 31,

(in millions) Connected Technology Solutions Essential Dental Solutions Orthodontic and Implant Solutions Wellspect Healthcare Total

Net sales 1,219 1,427 1,006 270 3,922

Adjusted cost of products sold (a)

631 540 370 109

Adjusted selling expenses (b)

251 301 285 48

Adjusted G&A expenses (b)

Adjusted R&D expenses (c)

Segment adjusted operating income 161 467 193 73 894

Reconciling items (income) expense:

Unallocated corporate costs (d)

Interest expense, net 65

Other (income) expense, net 53

Goodwill and intangible asset impairments 1,287

Restructuring and other costs 14

Amortization of intangibles 209

Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations 3

Loss before income taxes ( 1,055 )

(a) Adjusted cost of products sold represents expenses adjusted to exclude intangible amortization expense, step-up depreciation expense, and other restructuring costs.

Depreciation and Amortization Year Ended December 31,

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Total $ 349 $ 343 $ 328

(a) Includes amounts recorded at corporate headquarters.

Segment Adjusted Operating Income Year Ended December 31,

(in millions) 2023 2022 2021

Connected Technology Solutions $ 101 $ 161 $ 267

Essential Dental Solutions 478 467 511

Orthodontic and Implant Solutions 156 193 217

Wellspect Healthcare 87 73 87

Segment adjusted operating income $ 822 $ 894 $ 1,082

Reconciling items (income) expense:

All other (a)

Goodwill and intangible asset impairments 307 1,287 —

Restructuring and other costs 67 14 17

Interest expense, net 81 65 49

Other expense (income), net 9 53 14

Amortization of intangible assets 211 209 222

Depreciation resulting from the fair value step-up of property,

plant, and equipment from business combinations

(Loss) income before income taxes $ ( 175 ) $ ( 1,055 ) $ 545

(a) Includes the results of unassigned corporate headquarters costs.

(a) Includes unallocated corporate costs for depreciation and amortization

Geographic Information

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Product and Customer Information

For information on the Company’s net sales by product category comprising each of the reportable segments, see Note 2, Revenue.

For information on the Company’s net sales by product category comprising each of the reportable segments, see Note 2, Revenue Recognition.

Concentration Risk

For the year ended December 31, 2024, no customer accounted for 10% or more of consolidated net sales or consolidated accounts receivable.

Customers that accounted for 10% or more of net sales or accounts receivable for the years ended December 31, 2023 and 2022 were as follows:

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N/A 10 % N/A 12 %

For the year ended December 31, 2021, no customer accounted for 10% or more of consolidated net sales or consolidated accounts receivable.

NOTE 7 - OTHER EXPENSE (INCOME), NET

Other expense (income), net, were as follows:

NOTE 7 - OTHER (INCOME) EXPENSE, NET

Other (income) expense, net, were as follows:

Year Ended December 31,

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$ ( 21 ) $ ( 3 ) $ 6

Other expense (income), net 12 47 14

Total other expense (income), net $ 9 $ 53 $ 2

The Company’s equity-method net losses were $ 4 million, $ 36 million, and $ 10 million for the years ended December 31, 2023, 2022, and 2021, respectively.

On February 1, 2021, the Company disposed of an investment casting business previously included as part of the former Consumables segment in exchange for a cash receipt of $ 19 million.

The divestiture resulted in a pre-tax gain of $ 13 million recorded in Other expense (income), net in the Consolidated Statements of Operations for the year ended December 31, 2021.

Other expense, net 9 12 47

Total other (income) expense, net $ ( 12 ) $ 9 $ 53

The Company’s equity-method net loss for the year ended December 31, 2024 was no t significant.

The Company’s equity-method net losses for the years ended December 31, 2023 and 2022 were $ 4 million and $ 36 million, respectively.

NOTE 8 - INVENTORIES, NET

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Current liabilities

Finance leases Notes payable and current portion of long-term debt $ — $ 1

Operating leases Accrued liabilities 46 56

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Weighted-average discount rate

Finance leases 4.2 % 3.5 %

Operating leases 4.1 % 3.9 %

Weighted-average remaining lease term in years

Finance leases 5.2 4.1

Operating leases 4.1 4.5

The lease cost recognized in the Consolidated Statements of Operations were as follows:

The lease costs recognized in the Consolidated Statements of Operations were as follows:

Year Ended December 31,

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Operating lease cost $ 67 $ 67

Short-term lease cost — 1

Variable lease cost 16 15

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The contractual maturity dates of the remaining lease liabilities as of December 31, 2024 were as follows:

(in millions) Finance Leases Operating Leases Total

2024 $ — $ 62 $ 62

(in millions) Operating Leases

2030 and beyond 10

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Operating cash flows paid for operating leases $ 67 $ 68 $ 66

Right-of-use assets obtained in exchange for new lease liabilities:

Finance leases $ — $ — $ 1

Right-of-use assets obtained in exchange for new lease liabilities (non-cash investing activity):

Operating leases 19 36 57

NOTE 11 - GOODWILL AND INTANGIBLE ASSETS

The Company assesses both goodwill and indefinite-lived intangible assets for impairment annually as of April 1 or more frequently if events or changes in circumstances indicate the asset might be impaired.

On April 1, 2023, the Company realigned its reporting units due to a change in organizational structure.

Reporting units under the former structure were tested for impairment prior to the realignment, and no impairment was identified.

As a result of the realignment, the Company reallocated its goodwill to align its new reporting units which resulted from the change in its operating segments.

Goodwill was reassigned to each of the new reporting units using a relative fair value approach.

The Company assessed the goodwill of the new reporting units and its indefinite-lived intangible assets for impairment as of April 1, 2023.

For both the former and new structure goodwill impairment tests as of April 1, 2023, the fair values of reporting units were computed using a discounted cash flow model with inputs developed using both internal and market-based data.

Third Quarter 2023 Impairment

The Company’s policy is to assess goodwill and indefinite-lived intangible assets for impairment annually as of April 1, with more frequent assessments if events or changes in circumstances indicate an asset might be impaired.

Impairment charges are recorded in Goodwill and intangible asset impairment in the Consolidated Statement of Operations.

Impairment during the Three Months Ended March 31, 2024

In the three months ended March 31, 2024, the Company identified indicators of a more likely than not impairment related to certain indefinite-lived imaging product trade names within the Connected Technology Solutions segment.

The decline in fair value of these indefinite-lived trade names was driven by declines in volumes during the three months ended March 31, 2024, which were due in part to a loss in market share from competitive pricing pressures, as well as unfavorable economic conditions in certain markets.

These factors contributed to a reduction in forecasted revenues in the near term.

The trade names were evaluated for impairment using an income approach, specifically a relief from royalty method.

As a result, the Company recorded an indefinite-lived intangible asset impairment charge of $ 6 million for the three months ended March 31, 2024.

Impairment during the Three Months Ended September 30, 2024

The Company identified indicators of a more likely than not impairment in the three months ended September 30, 2024 for two of its reporting units, Orthodontic Aligner Solutions and Implant & Prosthetic Solutions, which together comprise all of the Orthodontic and Implant Solutions segment.

As a result, the Company recorded pre-tax goodwill impairment charges as of September 30, 2024 of $ 145 million for the Orthodontic Aligner Solutions reporting unit and $ 359 million for the Implant & Prosthetic Solutions reporting unit, both within the Orthodontic and Implant Solutions segment.

The impairment charge related to the Orthodontic Aligner Solutions reporting unit resulted in a full write-off of the remaining goodwill balance for this reporting unit.

Impairment during the Three Months Ended December 31, 2024

In the quarter ended December 31, 2024, the Company identified indicators of a more likely than not impairment for its Implant & Prosthetic Solutions reporting unit within the Orthodontic and Implant Solutions segment.

The decline in fair value of this reporting unit was driven by a weaker trend in sales volumes, particularly in North America, increased competition from lower-priced alternatives impacting global markets, and adverse macroeconomic pressures impacting demand for elective dental procedures and premium implant solutions.

These factors contributed to reduced forecasted revenues, lower operating margins, and reduced expectations for future cash flows.

The fair value of the Implant & Prosthetic Solutions reporting unit was computed using a discounted cash flow model with inputs developed using both internal and market-based data.

The discounted cash flow model uses ten -year forecasted cash flows plus a terminal value based on capitalizing the last period’s cash flows using a perpetual growth rate.

Significant assumptions used in the discounted cash flow model included, but were not limited to, the discount rate of 12.5 %, revenue growth rates (including perpetual growth rates), operating margin percentages, and net working capital changes of the reporting unit’s business.

As a result, the Company recorded a pre-tax goodwill impairment charge as of December 31, 2024 of $ 269 million for the Implant & Prosthetic Solutions reporting unit within the Orthodontic and Implant Solutions segment.

Additionally, in the quarter ended December 31, 2024, the Company also identified indicators of more likely than not impairments for certain indefinite-lived intangible assets including trade names and trademarks within the Connected Technology Solutions segment, and certain trade names within the Implant & Prosthetic Solutions reporting unit within the Orthodontic and Implant Solutions segment.

The decline in fair value of the trade names and trademarks was driven by weakened demand for the Company’s premium equipment and implant products, competitive pricing pressures, and a sustained higher cost of capital, which are contributing to reduced forecasted revenues.

These indefinite-lived intangible assets were evaluated for impairment using an income approach, specifically a relief from royalty methodology.

The Company’s significant assumptions in the relief from royalty method include, but are not limited to, discount rates ranging from 12.5 % to 14.5 %, revenue growth rates (including perpetual growth rates), and royalty rates.

As a result, the Company recorded indefinite-lived intangible asset impairment charges of $ 82 million and $ 1 million for the Connected Technology Solutions and Orthodontic and Implant Solutions segments, respectively, for the three months ended December 31, 2024.

As a result of suspending sales of Byte clear aligner and impression kits during the fourth quarter, and subsequently announcing plans that the Byte aligners would no longer be offered to new patients, the Company recorded a full write-off of the Byte trademark intangible asset within the Orthodontic and Implant Solutions segment, resulting in a charge of $ 152 million based on a determination that the trademark will not be used in the future operating model for aligners.

The Company plans to continue to use technology associated with approximately $ 178 million in other intangible assets acquired with the Byte

business, primarily developed technology acquired in the initial purchase of Byte, to support other product offerings and enhance customer experience elsewhere in the Company.

See Note 18, Restructuring and Other Costs for additional information.

The remaining goodwill balance of the Implant & Prosthetic Solutions reporting unit was $ 503 million as of December 31, 2024, and the carrying values of indefinite-lived intangible assets with impairments in the fourth quarter were $ 76 million and $ 149 million for the Implant & Prosthetic Solutions and Connected Technology Solutions reporting units, respectively, as of December 31, 2024.

As the fair values of the Implant & Prosthetic Solutions reporting unit and the indefinite-lived assets within the Implant & Prosthetic Solutions and Connected Technology Solutions reporting units, respectively, continue to approximate carrying value as of December 31, 2024, any further decline in key assumptions could result in additional impairments in future periods .

Based on quantitative and qualitative analyses performed for the other reporting units and the Company’s other indefinite-lived intangible assets, the Company believes there is no indication that the carrying value more likely than not exceeds the fair value in each case as of December 31, 2024.

For the Company’s reporting units that were not impaired, the Company applied a hypothetical sensitivity analysis by increasing the discount rate of these reporting units by 50 basis points.

The results of this sensitivity analysis at December 31, 2024 indicate that none of the other reporting units would be impaired.

There is a risk of future impairment charges if there is a decline in the fair value of the reporting units or indefinite-lived intangible assets as a result of, among other things, actual financial results that are lower than forecasts, an adverse change in valuation assumptions, a decline in equity valuations, increases in interest rates, or changes in the use of intangible assets.

There can be no assurance that the Company’s future asset impairment testing will not result in a material charge to earnings.

2023 Goodwill and Indefinite-Lived Intangibles Impairment and Testing

In the quarter ended September 30, 2023, the Company identified indicators of a more likely than not impairment related to its Connected Technology Solutions reporting unit, which comprises all the Connected Technology Solutions segment.

The decline in fair value for this reporting unit was driven by adverse macroeconomic factors because of weakened demand, particularly in European markets, and increased discount rates.

Core underlying market interest rates, which serve as the basis for the discount rate assumptions in our impairment models, rose by approximately 110 bps between the annual impairment test and the interim test during the third quarter of 2023.

These factors contributed to reduced forecasted revenues, lower operating margins, and reduced expectations for future cash flows in the near term, particularly in relation to demand for products which are commonly financed by end customers and are therefore adversely impacted by an environment of higher interest rates.

The higher inflationary environment has also impacted the discretionary spending behavior of our customers more generally, further reducing global demand for certain products in favor of lower cost options.

As such, an impairment test was performed in the third quarter of 2023 (the “third quarter test”).

During the third quarter test, the fair value of the Connected Technology Solutions reporting unit was computed using a discounted cash flow model with inputs developed using both internal and market-based data.

The discounted cash flow model uses ten -year forecasted cash flows plus a terminal value based on capitalizing the last period’s cash flows using a perpetual growth rate.

Significant assumptions used in the discounted cash flow model included, but were not limited to, a discount rate of 11.5 %, revenue growth rates (including perpetual growth rates), and operating margin percentages of the reporting unit’s business.

The reporting unit was evaluated for impairment using an income approach, specifically a discounted cash flow model.

As a result, the Company recorded a pre-tax goodwill impairment charge for the three months ended September 30, 2023 related to the Connected Technology Solutions reporting unit of $ 291 million, resulting in a full write-off of the remaining goodwill balance for the Connected Technology Solutions segment.

This charge was recorded in Goodwill and intangible asset impairment in the Consolidated Statement of Operations.

Additionally, in conjunction with the third quarter test, the Company tested the long-lived intangible assets related to the businesses within the Connected Technology Solutions reporting unit within the Connected Technology Solutions segment for impairment.

The Company also identified an indicator of impairment for the indefinite-lived intangible assets within the Implants & Prosthetics reporting unit within the Orthodontic and Implant Solutions segment, and determined certain tradenames and trademarks were impaired.

Additionally, in conjunction with the third quarter test in 2023, the Company conducted an impairment test on the indefinite-lived intangible assets related to the businesses within the Connected Technology Solutions reporting unit within the Connected Technology Solutions segment.

The Company also identified an indicator of impairment for the indefinite-lived intangible assets within the Implant & Prosthetic Solutions reporting unit within the Orthodontic and Implant Solutions segment and determined certain trade names and trademarks were impaired.

These indefinite-lived intangible assets were evaluated for impairment using an income approach, specifically a relief from royalty method.

Significant assumptions used in the relief from royalty method included, but were not limited to, discount rates (ranging from 11.5 % to 16.5 %) revenue growth rates (including perpetual growth rates), and royalty rates.

As a result, the Company recorded indefinite-lived intangible asset impairment charges of $ 14 million and $ 2 million for the Connected Technology Solutions and Orthodontic and Implant Solutions segments, respectively, for the three months ended September 30, 2023.

The impairment charge was primarily driven by macroeconomic factors such as weakened demand, higher cost of capital, and cost inflation, which are contributing to reduced forecasted revenues.

These charges were recorded in Goodwill and intangible asset impairment in the Consolidated Statements of Operations.

The carrying values of indefinite-lived intangible assets impaired in the third quarter of 2023 were $ 215 million and $ 23 million for the Connected Technology Solutions and Orthodontic and Implant Solutions segments, respectively, as of December 31, 2023.

As the fair value of these indefinite-lived intangible assets continues to approximate carrying value as of December 31, 2023, any further decline in key assumptions could result in additional impairments in future periods.

As of December 31, 2023, the Company considered qualitative and quantitative factors to determine whether any events or changes in circumstances had resulted in the likelihood that the goodwill or indefinite-lived intangible assets may have become more likely than not impaired during the fourth quarter of 2023 and concluded there were no such indicators.

Any deviation in actual financial results compared to the forecasted financial results or valuation assumptions used in the annual or interim tests, a decline in equity valuations, increases in interest rates, or changes in the use of intangible assets, among other factors, could have a material adverse effect to the fair value of either the reporting units or indefinite-lived intangibles assets and could results in a future impairment charge.

There can be no assurance that the Company’s future asset impairment testing will not result in a material charge to earnings.

2022 Annual Goodwill and Indefinite-Lived Intangibles Impairment and Testing

In the third and fourth quarters of 2022, the Company experienced adverse macroeconomic factors because of weakened global demand, higher cost of capital, unfavorable foreign currency impacts, and increased raw material, supply chain, and service costs, which contributed to reduced forecasted revenues, lower operating margins, and reduced expectations for future cash flows.

As a result, the Company identified indicators of a more likely than not impairment related to its former Digital Dental Group and former Equipment & Instruments reporting units within the former Technologies & Equipment segment and certain indefinite-lived intangible assets, within these former reporting units as well as the former Consumables reporting unit within the former Consumables segment.

The fair values of the two former reporting units above were computed using a discounted cash flow model with inputs developed using both internal and market-based data.

The discounted cash flow model uses five - to ten - year forecasted cash flows plus a terminal value based on capitalizing the last period’s cash flows using a perpetual growth rate.

The Company’s significant assumptions in the discounted cash flow models include, but are not limited to, the discount rate of 11.0 %, revenue growth rates (including perpetual growth rates), operating margin percentages, and net working capital changes of the reporting unit’s business.

These assumptions were developed in consideration of current market conditions and future expectations which include, but were not limited to, distribution channel changes, impact from competition, and new product developments.

The Company also considered current and projected market and economic conditions.

2022 Goodwill and Indefinite-Lived Intangibles Impairment and Testing

In the third and fourth quarters of 2022, the Company identified indicators of a more likely than not impairment related to its former Digital Dental Group and former Equipment & Instruments reporting units within the former Technologies & Equipment segment and certain indefinite-lived intangible assets within these former reporting units as well as the former Consumables reporting unit within the former Consumables segment.

The decline in fair value for these reporting units was driven by weakened global demand, higher cost of capital, unfavorable foreign currency impacts, and increased raw material, supply chain, and service costs, which contributed to reduced forecasted revenues, lower operating margins, and reduced expectations for future cash flows.

The reporting unit was evaluated for impairment using an income approach, specifically a discounted cash flow model.

As a result, the Company recorded a pre-tax goodwill impairment charge related to the former Digital Dental Group and former Equipment & Instruments reporting units within the former Technologies & Equipment segment of $ 1,100 million and $ 87 million, respectively, for the three months ended September 30, 2022.

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The fair values of intangible assets were computed using either an income approach, specifically a relief from royalty method, or a qualitative assessment.

The Company’s significant assumptions in the relief from royalty method include, but were not limited to, discount rates ranging from 11.0 % to 12.5 %, revenue growth rates (including perpetual growth rates) and royalty rates.

As a result, the Company recorded impairment charges for its indefinite-lived intangible assets of $ 66 million and $ 28 million for the former Digital Dental Group and former Equipment & Instruments reporting units, respectively, within the former Technologies & Equipment segment, and a $ 6 million charge for the former Consumables reporting unit within the former Consumables segment, for the year ended December 31, 2022.

This charge was recorded in Goodwill and intangible asset impairment in the Consolidated Statements of Operations.

2021 Annual Goodwill and Indefinite-Lived Intangibles Impairment and Testing

The Company performed the required annual impairment tests of goodwill and indefinite-lived intangibles as of April 1, 2021 consistent with the valuation approaches described above, which did not result in any impairment for the year ended December 31, 2021.

A reconciliation of changes in the Company’s goodwill by reportable segment were as follows:

(in millions) Technologies & Equipment Consumables Connected Technology Solutions Essential Dental Solutions Orthodontic and Implant Solutions Wellspect Healthcare Total

(in millions) Connected Technology Solutions Essential Dental Solutions Orthodontic and Implant Solutions Wellspect Healthcare Total

Balance at December 31, 2023

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Goodwill, net December 31, 2023

Translation 9 4 — — — — 13

Balance at March 31, 2023

Goodwill $ 5,911 $ 870 $ — $ — $ — $ — $ 6,781

Accumulated impairment losses ( 4,080 ) — — — — — ( 4,080 )

Goodwill, net March 31, 2023 $ 1,831 $ 870 $ — $ — $ — $ — $ 2,701

Realignment of goodwill ( 1,831 ) ( 870 ) 293 835 1,303 270 $ —

Translation — — — 1 ( 5 ) 6 2

Goodwill, net June 30, 2023 $ — $ — $ 293 $ 836 $ 1,298 $ 276 $ 2,703

$ — $ 840 $ 1,323 $ 275 $ 2,438

Impairment — — ( 773 ) — ( 773 )

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Accumulated impairment losses ( 291 ) — ( 773 ) — ( 1,064 )

Balance at December 31, 2023 $ — $ — $ — $ 840 $ 1,323 $ 275 $ 2,438

Identifiable definite-lived and indefinite-lived intangible assets at were as follows:

Goodwill, net at December 31, 2024

$ — $ 829 $ 503 $ 265 $ 1,597

Identifiable definite-lived and indefinite-lived intangible assets were as follows:

Year Ended December 31,

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Developed technology and patents $ 1,639 $ ( 1,079 ) $ 560 $ 1,697 $ ( 1006 ) $ 691

Tradenames and trademarks 271 ( 102 ) 169 273 ( 96 ) 177

Trade names and trademarks 79 ( 73 ) 6 271 ( 102 ) 169

Licensing agreements 29 ( 28 ) 1 30 ( 27 ) 3

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Total definite-lived $ 2,766 $ ( 1,896 ) $ 870 $ 3,068 $ ( 1,815 ) $ 1,253

Indefinite-lived tradenames and trademarks 447 — 447 450 — 450

Indefinite-lived trade names and trademarks 332 — 332 447 — 447

In-process R&D (a)

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The estimated annual amortization expense related to these intangible assets for each of the five succeeding calendar years is $ 204 million, $ 132 million, $ 114 million, $ 119 million and $ 120 million for 2025, 2026, 2027, 2028 and 2029, respectively.

During the second quarter of 2021, the Company purchased certain developed technology rights for an initial payment of $ 3 million.

The purchase consideration also includes contingent payments of $ 17 million to be made upon reaching certain regulatory and commercial milestones, which were not yet considered probable at December 31, 2023.

During the second quarter of 2021, the Company acquired certain developed technology rights for an initial payment of $ 3 million.

During the fourth quarter of 2024, regulatory and commercial milestones related to the acquisition were achieved, triggering an additional payment of $ 7 million.

As of December 31, 2024, the Company recognized a liability of $ 10 million for contractual future payments associated with this acquisition that were deemed probable.

Both the payment and future obligation were recorded as increases to the developed technology asset for the year ended December 31, 2024.

NOTE 12 - PREPAID EXPENSES AND OTHER CURRENT ASSETS

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Short-Term Borrowings

On May 12, 2023, the Company entered into a five-year senior unsecured multi-currency revolving facility, for an aggregate principal amount of $ 700 million that expires on May 12, 2028.

This new facility replaced the prior $ 700 million five-year senior unsecured multi-currency revolving facility that was scheduled to expire on July 26, 2024.

The Company has a five-year senior unsecured multi-currency revolving facility, for an aggregate principal amount of $ 700 million, that expires on May 12, 2028.

The Company also has a $ 700 million commercial paper program.

The $ 700 million multi-currency revolving credit facility serves as a back-up to the commercial paper facility, thus the total available credit under the commercial paper facility and the multi-currency revolving credit facility in the aggregate is $ 700 million.

The $ 700 million multi-currency revolving credit facility serves as a back-up to the commercial paper facility, resulting in an aggregate of $ 700 million total available credit under the commercial paper facility and the multi-currency revolving credit facility.

The Company had outstanding borrowings of $ 410 million and $ 225 million under the commercial paper facility at December 31, 2024 and December 31, 2023, respectively, and no outstanding borrowings under the multi-currency revolving credit facility.

The Company also has access to $ 44 million in uncommitted short-term financing under lines of credit from various financial institutions, the availability of which is reduced by other short-term borrowings of $ 20 million.

At December 31, 2023, the Company had $ 499 million borrowings available under unused lines of credit, including lines available under its short-term arrangements and revolving credit agreement.

The Company also has access to $ 34 million in uncommitted short-term financing available under lines of credit from various financial institutions, which is reduced by outstanding short-term borrowings of $ 11 million.

At December 31, 2024, the weighted-average interest rate for short-term debt was 5.3 %.

At December 31, 2024, the Company had $ 313 million borrowings available under unused lines of credit, including lines available under its short-term arrangements and revolving credit facility.

Long-Term Debt

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(a) Represents the fair value of interest rate swap agreements entered into on a portion of the outstanding senior notes.

The Company’s multi-currency revolving credit facility, term loans and senior notes contain certain affirmative and negative covenants relating to the Company’s operations and financial condition.

The Company’s revolving credit facility, term loans, and senior notes contain certain affirmative and negative debt covenants relating to the Company’s operations and financial condition.

At December 31, 2024, the Company was in compliance with all debt covenants.

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2030 and beyond 1,093

Interest expense, net includes interest income of $ 16 million, $ 11 million and $ 3 million for the years ended December 31, 2023, 2022 and 2021, respectively, primarily relating to interest-bearing cash equivalents and customer financing for our direct-to-consumer aligner solutions.

Interest expense, net includes interest income of $ 20 million, $ 16 million and $ 11 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Interest income primarily relates to interest-bearing cash equivalents and customer financing for the Company’s direct-to-consumer aligner solutions.

NOTE 15 - EQUITY

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The Company repurchased shares under the ASR Agreement as part of the share repurchase program described above.

In 2023, the Company repurchased approximately 3.1 million shares delivered during March 2023 at a volume-weighted average price of $ 38.74 representing $ 120 million of the total anticipated repurchase.

In 2023, the Company repurchased approximately 3.1 million shares, which were delivered during March 2023, at a volume-weighted average price of $ 38.74 , representing $ 120 million of the total anticipated repurchase size.

In April 2023, an additional 0.8 million shares were delivered upon the final settlement of the ASR Agreement, resulting in a total of 3.9 million shares repurchased under the agreement.

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For the years ended December 31, 2024, 2023 and 2022, the Company repurchased outstanding shares of common stock at a cost of $ 250 million, $ 300 million and $ 150 million, respectively.

For the year ended December 31, 2023, the treasury stock transactions resulted in an excise tax accrual of $ 3 million for public company stock repurchases established by the Inflation Reduction Act of 2022.

For the year ended December 31, 2023, stock options exercised and the proceeds received at exercise were not significant.

For the years ended December, 31, 2022 and 2021, the Company received proceeds of $ 6 million and $ 51 million, respectively, primarily as a result of stock options exercised in the amount of 0.1 million and 1.1 million in each of the years, respectively.

For the year ended December 31, 2024, the treasury stock transactions resulted in an excise tax charge of $ 2 million for public company stock repurchases established by the Inflation Reduction Act of 2022.

For the years ended December 31, 2024 and 2023, stock options exercised and the proceeds received at exercise were not significant.

For the year ended December 31, 2022, the Company received proceeds of $ 6 million primarily as a result of stock options exercised in the amount of 0.1 million.

It is the Company’s practice to issue shares from treasury stock when stock options are exercised and RSUs vest.

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NOTE 16 - INCOME TAXES

The components of (loss) income before income taxes were as follows:

The components of loss before income taxes were as follows:

Year Ended December 31,

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Foreign ( 629 ) ( 169 ) ( 524 )

Total (loss) income before income taxes

Total loss before income taxes

$ ( 936 ) $ ( 175 ) $ ( 1,055 )

The components of the (benefit) provision for income taxes from operations were as follows:

The components of the benefit for income taxes from operations were as follows:

Year Ended December 31,

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Total $ ( 136 ) $ ( 130 ) $ ( 228 )

Total (benefit) provision for income taxes $ ( 43 ) $ ( 105 ) $ 134

Total benefit for income taxes

$ ( 26 ) $ ( 43 ) $ ( 105 )

The reconciliation of the U.S.

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Federal benefit of R&D and foreign tax credits ( 7 ) 0.8 ( 17 ) 10.0 ( 8 ) 0.8

US other permanent differences 5 ( 2.7 ) 9 ( 0.9 ) 2 0.4

other permanent differences 3 ( 0.3 ) 5 ( 2.7 ) 9 ( 0.9 )

Tax effect of international operations 42 ( 4.5 ) ( 65 ) 37.2 ( 5 ) 0.5

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Total deferred tax liabilities ( 191 ) ( 390 )

Net deferred tax liabilities $ ( 15 ) $ ( 186 )

Deferred tax assets and liabilities are included in the following Consolidated Balance Sheets line items at December 31 were as follows:

Net deferred tax assets (liabilities) $ 93 $ ( 15 )

Deferred tax assets and liabilities included in the following Consolidated Balance Sheets line items at December 31 were as follows:

Year Ended December 31,

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The Company has tax loss carryforwards related to certain foreign and domestic subsidiaries of approximately $ 7,482 million at December 31, 2024, of which $ 7,214 million expires at various times through 2044 and $ 268 million may be carried forward indefinitely.

These are reflected as deferred income tax assets at December 31, 2023, comprising of tax benefits o f $ 873 million and $ 74 million, before valuation allowances, related to tax loss carryforwards and disallowed interest carryforwards, respectively.

These are reflected as deferred income tax assets at December 31, 2024, and are comprised of future tax benefits o f $ 1,458 million and $ 96 million, before valuation allowances, related to tax loss carryforwards and disallowed interest carryforwards, respectively.

As of December 31, 2023 the Company’s deferred tax assets included $ 873 million of tax loss carryforwards and $ 74 million of disallowed interest carryforwards.

The increase in tax loss carryforwards in 2023 is primarily a result of impairment losses.

At December 31, 2023, the Company has recorded $ 791 million of valuation allowance to offset the tax benefit of net operating losses, $ 40 million to offset the tax benefit of foreign tax credits, and $ 32 million of valuation allowance for other deferred tax assets.

The increase in tax loss carryforwards in 2024 is primarily the result of impairment losses.

At December 31, 2024, the Company has recorded $ 1,395 million of valuation allowance to offset the future tax benefit of net operating losses, $ 29 million to offset the future tax benefit of foreign tax credits, and $ 79 million of valuation allowance for other deferred tax assets.

The Company has recorded these valuation allowances due to the uncertainty that these assets can be realized in the future.

The increase in the valuation allowance is attributable to the increase in the tax loss carryforwards generated in 2024 as there is uncertainty that these assets can be realized in the future.

The Company has provided $ 8 million of withholding taxes on certain undistributed earnings of its foreign subsidiaries that the Company anticipates will be repatriated.

Undistributed earnings of foreign subsidiaries and related companies that are considered to be permanently invested amounted to $ 2,303 million a t December 31, 2023 and $ 2,492 million at December 31, 2022 .

The Company has recorded $ 6 million of withholding taxes on certain undistributed earnings of its foreign subsidiaries that the Company anticipates will be repatriated.

Undistributed earnings of foreign subsidiaries and related companies that are considered to be permanently invested amounted to $ 348 million at December 31, 2024.

Tax Contingencies

The total amount of gross unrecognized tax benefits at December 31, 2024 is approximately $ 137 million, including interest, of which approximately $ 51 million represents the amount of unrecognized tax benefits that, if recognized, would affect the effective income tax rate.

It is reasonably possible that certain amounts of unrecognized tax benefits will significantly increase or decrease within twelve months of the reporting date of the Company’s consolidated financial statements.

Expiration of statutes of limitations in various jurisdictions during the next twelve months could include unrecognized tax benefits of approximately $ 6 million, which, if recognized, would affect the effective income tax rate.

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The Company has consistently classified interest and penalties recognized in its consolidated financial statements as income taxes based on the accounting policy election of the Company.

The Company recognized a tax benefit of $ 2 million for the years ended December 31, 2023 and 2022 related to interest and penalties.

The increase in unrecognized tax benefits in 2023 is primarily related to a gain generated from an internal debt structuring in 2023.

If this benefit was recognized, it would result in a reduction to deferred tax assets related to tax loss carryforwards, with an equal and offsetting reduction to the valuation allowance.

Thus, the release of this reserve would not impact the effective tax rate.

The Company recognized a tax expense of $ 5 million for the year ended December 31, 2024, and a tax benefit of $ 2 million in 2023 related to interest and penalties.

The increase in unrecognized tax benefits in 2024 is primarily related to transfer pricing adjustments in certain jurisdictions, offset by a decrease from foreign currency translation.

The Company is subject to U.S.

federal income tax as well as income tax of multiple state and foreign jurisdictions.

The significant jurisdictions include the United States, Germany, Sweden and Switzerland.

The significant jurisdictions include the United States and Germany.

The Company has concluded all U.S.

federal income tax matters for years through 2014 with the Internal Revenue Service (“IRS”).

The Company is currently under audit for the tax years 2015 and 2016.

For additional information on the IRS audit, see Note 21, Commitments and Contingencies.

The Company concluded audits in Germany through the tax year 2014 and is currently under audit for the years 2015 through 2017.

The tax years 2018 through 2021 are subject to future potential audit adjustments in Germany.

The Company is currently under IRS audit for the tax years 2015 and 2016.

The Company is under audit in Germany for the tax years 2014 through 2021.

For additional information on the IRS and German audits, see Note 21, Commitments and Contingencies.

The activity recorded for unrecognized tax benefits were as follows:

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Decrease due to statute expirations — ( 4 ) —

Decrease due to effect from foreign currency translation — ( 1 ) ( 1 )

Increase due to effect of foreign currency translation — — —

Decrease due to effect from foreign currency translation and other ( 10 ) — ( 1 )

Unrecognized tax benefits at end of period $ 128 $ 132 $ 49

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plan, the Dentsply Sirona Inc.

401(k) Savings Plan (the “Plan”), allows eligible employees to contribute a portion of their cash compensation to the plan on a tax-deferred basis, and in most cases, the Company provides a matching contribution.

401(k) Savings Plan (the “Plan”), allows eligible employees to contribute a portion of their cash compensation to the Plan on a tax-deferred basis, and the Company provides a matching contribution.

The Plan includes various investment funds.

The Company may make a non-elective discretionary cash contribution of 3 % of compensation to participant accounts.

Additionally, each eligible participant who elects to contribute to the Plan will receive a matching contribution of 100 % on the first 1% contributed and 50 % on the next 5% contributed for a total maximum matching contribution of 3.5 %.

In addition to the primary U.S.

plan, the Company also maintains various other U.S.

Each eligible participant who elects to contribute to the Plan will receive a matching contribution of 100 % on the first 1% contributed and 50 % on the next 5% contributed for a total maximum matching contribution of 3.5 %.

At its discretion, the Company may make additional non-elective cash contributions based on a percentage of compensation to participant accounts.

The Company did not make any additional non-elective cash contributions in connection with 2024 compensation.

In addition to the Plan, the Company also maintains various other U.S.

defined contribution and non-qualified deferred compensation plans.

The annual expenses, net of forfeitures, were $ 43 million, $ 41 million and $ 39 million for the years ended December 31, 2023, 2022, and 2021, respectively.

The annual expenses, net of forfeitures, of these plans were $ 34 million, $ 43 million and $ 41 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Defined Benefit Plans

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The Company predominantly derives its discount rates by applying the specific spot rates along the yield curve to the relevant projected cash flows;

or, in markets where there is an absence of a sufficiently deep corporate bond market, it uses liability durations in establishing its discount rates, which are observed from indices of high-grade corporate or government bond yield in the respective economic regions of the plan.

For the large defined benefits pension plans, the Company uses a spot rate approach for the estimation of the Service cost and Interest cost components of benefit cost by applying the specific spot rates along the yield curve to the relevant projected cash flows.

Significant changes in the retirement plan benefit obligations for the year ended December 31, 2024 include a $ 9 million actuarial gain primarily attributable to the increase in discount rates, the effect of which is slightly offset by a $ 1 million loss due to a change in the lump sum withdrawal rate for the Swiss plan.

The changes also include a $ 4 million actuarial loss due to plan experience being different than anticipated.

Significant changes in the retirement plan benefit obligations for the year ended December 31, 2023 include a $ 35 million actuarial loss primarily attributable to the decrease in discount rates, the effect of which is slightly offset by the change in inflation and salary increase assumptions in some plans.

The changes also include a $ 3 million actuarial loss due to plan experience different than anticipated.

Significant changes in the retirement plan benefit obligations for the year ended December 31, 2022 include a $ 162 million actuarial gain primarily attributable to the increase in discount rates, the effect of which is slightly offset by the change in inflation and salary increase assumptions in some plans.

The changes also include a $ 1 million actuarial gain due to demographic assumption changes and a $ 14 million actuarial loss due to plan experience different than anticipated.

The changes also include a $ 3 million actuarial loss due to plan experience being different than anticipated.

Defined Benefit Pension Plan Assets

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Participant contributions 5 4

Actuarial losses (gains)

Actuarial (gains) losses ( 4 ) 38

Effect of exchange rate changes ( 36 ) 26

Plan curtailments and settlements — ( 1 )

Benefits paid ( 21 ) ( 21 )

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Actual return on assets 16 10

Plan settlements — ( 1 )

Effect of exchange rate changes ( 15 ) 17

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(in millions) Consolidated Balance Sheets 2024 2023

Other noncurrent assets, net Other noncurrent assets $ 5 $ 9

Other noncurrent assets Other noncurrent assets $ 4 $ 5

Deferred tax asset Other noncurrent assets 8 11

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Net of tax AOCI $ 23 $ 36

Information for pension plans with a projected or accumulated benefit obligation in excess of plan assets were as follows:

Information for pension plans with a projected or accumulated benefit obligation in excess of plan assets was as follows:

Year Ended December 31,

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Service cost 7 6 7 Selling, general and administrative expenses

Interest cost 14 5 3 Other expense (income), net

Expected return on plan assets ( 6 ) ( 4 ) ( 4 ) Other expense (income), net

Amortization of prior service credit ( 1 ) ( 1 ) ( 1 ) Other expense (income), net

Amortization of net actuarial loss — 8 12 Other expense (income), net

Acquisitions/Divestitures — — 1 Other expense (income), net

Curtailment and settlement gains — ( 1 ) ( 1 ) Other expense (income), net

Interest cost 12 14 5 Other (income) expense, net

Expected return on plan assets ( 5 ) ( 6 ) ( 4 ) Other (income) expense, net

Amortization of prior service credit ( 1 ) ( 1 ) ( 1 ) Other (income) expense, net

Amortization of net actuarial loss 2 — 8 Other (income) expense, net

Curtailment and settlement gains — — ( 1 ) Other (income) expense, net

Net periodic benefit cost $ 19 $ 17 $ 19

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(in millions) 2024 2023 2022

Net actuarial losses (gains)

$ 37 $ ( 125 ) $ ( 36 )

Net actuarial (gains) losses $ ( 17 ) $ 37 $ ( 125 )

Amortization ( 1 ) 1 ( 7 )

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Fair Value Measurements of Plan Assets

The fair value of the Company’s pension plan assets at December 31, 2023 and 2022 are presented in the table below by asset category.

The fair values of the Company’s pension plan assets at December 31, 2024 and 2023 are presented in the table below by asset category.

Approximately 83 % of the total plan assets are categorized as Level 1, as the values assigned to these pension assets are based on quoted prices available in active markets.

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(b) This category includes mutual funds balanced between moderate income generation and moderate capital appreciation with investment allocations of approximately 50 % equities and 50 % fixed income investments.

A reconciliation from December 31, 2021 to December 31, 2023 for the plan assets categorized as Level 3 were as follows:

A reconciliation from December 31, 2022 to December 31, 2024 for the plan assets categorized as Level 3 was as follows:

(in millions) Insurance

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NOTE 18 - RESTRUCTURING AND OTHER COSTS

Restructuring and other costs for the years ended December 31, 2023, 2022 and 2021 were as follows:

Restructuring and other costs for the years ended December 31, 2024, 2023 and 2022 were recorded in the Consolidated Statements of Operations as follows:

Affected Line Item in the Consolidated Statements of Operations Year Ended December 31,

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Selling, general, and administrative expenses 32 3 —

Restructuring and other costs 67 14 17

Restructuring costs 53 67 14

Total Restructuring and other costs $ 95 $ 74 $ 14

Restructuring and other costs of $ 67 million recorded in the year ended December 31, 2023 consisted primarily of employee severance benefits and other restructuring costs related to the plan approved by the Board of Directors of the Company on February 14, 2023.

This plan seeks to restructure the Company’s business to improve operational performance and drive shareholder value creation through a new operating model with four operating segments, optimization of central functions and overall management infrastructure, and other efforts aimed at cost savings.

The restructuring plan anticipates a reduction in the Company’s global workforce of approximately 8 % to 10 %, subject to co-determination processes with employee representative groups in countries where required which are now substantially complete.

The Company expects to incur between $ 115 and $ 135 million in non-recurring charges, comprising $ 80 to $ 100 million in restructuring expenditures and charges, primarily related to employee transition, severance payments, employee benefits and facility closure costs, and $ 35 million in other non-recurring costs which mostly consist of consulting, legal and other professional service fees.

The plan is expected to be substantially completed by mid-2024.

The estimates of these charges and their timing are subject to several assumptions, including local law requirements in various jurisdictions and co-determination aspects in countries where required.

Restructuring and other costs of $ 95 million were recorded in the year ended December 31, 2024, which consisted primarily of employee severance benefits and other costs related to the restructuring plans approved by the Board of Directors of the Company on July 29, 2024 (the “2024 Plan”) and on February 14, 2023 (the “2023 Plan”), as well as certain asset impairments resulting from the strategic actions related to the Byte aligners business beginning in October 2024 (the “Byte Realignment”).

Restructuring Plans

With the 2024 Plan, the Company seeks to improve operational performance and drive stockholder value creation.

In connection with the 2024 Plan, which is expected to be substantially completed by the end of 2025, the Company anticipates a net reduction in the Company’s global workforce of approximately 2 % to 4 %.

The proposed changes are subject to co-determination processes with employee representative groups in countries where required.

Actions taken under the 2024 Plan seek to further streamline the Company’s operations and global footprint, as well as improve alignment of the Company’s cost structure with its strategic growth objectives.

As of December 31, 2024, the Company has incurred $ 28 million in restructuring charges under the 2024 Plan since its inception.

In total, the Company expects to incur between $ 35 million and $ 50 million in non-recurring restructuring charges under the 2024 Plan, primarily related to employee transition, severance payments, and employee benefits, which are expected to be expensed and paid in cash by the end of 2025.

With the 2023 Plan, the Company sought to restructure the business through a new operating model with five global business units, optimize central functions and overall management infrastructure, and implement other efforts aimed at cost savings.

The 2023 Plan’s annual cost savings target of $ 200 million has been substantially met, with the benefits mostly offset in the short term by additional investments in sales personnel, the Company’s new global Enterprise Resource Planning (“ERP”) system, and other transformation initiatives.

As of December 31, 2024, the Company has incurred $ 87 million in restructuring charges under the 2023 Plan since its inception, primarily related to employee transition, severance payments, employee benefits, and facility closure costs, and $ 20 million in other non-recurring costs related to restructuring activities, which mostly consist of consulting, legal, and other professional service fees.

Remaining restructuring charges attributable to the 2023 Plan are not expected to be material.

The estimates of the charges and expenditures that the Company expects to incur in connection with the 2024 Plan, and the timing thereof, are subject to several assumptions, including local law requirements in various jurisdictions and co-determination aspects in countries where required.

Actual amounts may differ materially from estimates.

In addition, the Company may incur other charges or cash expenditures in connection with this plan which are not currently contemplated.

In addition, the Company may incur additional charges or cash expenditures not currently contemplated due to unanticipated events that may occur, including in connection with the implementation of the 2024 Plan.

The liabilities associated with the Company’s restructuring plans are recorded in Accrued liabilities and Other noncurrent liabilities in the Consolidated Balance Sheets.

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Amounts applied — ( 3 ) — ( 3 )

Change in estimates — — ( 1 ) ( 1 )

Balance at December 31, 2024 $ 1 $ — $ — $ 1

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Total $ 8 $ 74 $ ( 38 ) $ ( 4 ) $ 40

Byte Realignment

The changes to the Byte clear aligners business disclosed in Note 6, Segment and Geographic Information, have resulted in significant reductions in revenue forecasts and a triggering event in the fourth quarter of 2024 to evaluate the recoverability of assets attributable to Byte.

The Company recorded long-term tangible asset charges, which include production equipment and capitalized software, as well as working capital for certain inventory and customer receivables specific to Byte.

Additionally, the Company recorded a full impairment of the Byte trademark intangible asset.

In addition to these impairments, the Company recorded a full accrual for expected customer refunds and other reimbursement payments stemming from the cessation of sales, which resulted in a $ 35 million reduction to net sales, of which $ 13 million was paid during the three months ended December 31, 2024, with the remainder expected to be paid in 2025.

The impact of these charges related to the Byte Realignment was as follows:

Location in the Consolidated Statements of Operations

(in millions) December 31, 2024

Change in refund estimate $ ( 35 )

Cost of products sold

Inventory reserve ( 8 )

Selling, general, and administrative expenses

Intangible asset impairment - trademark ( 152 )

Property, plant and equipment write-off ( 17 )

Accounts receivable reserve and prepaid write-off ( 10 )

Total impact on operating loss $ ( 222 )

NOTE 19 - FINANCIAL INSTRUMENTS AND DERIVATIVES

Derivative Instruments and Hedging Activities

The Company’s operations expose it to a variety of market risks, which primarily include the risks related to the effects of changes in foreign currency exchange rates and interest rates.

The Company’s activities expose it to a variety of market risks, which primarily include the risks related to the effects of changes in foreign currency exchange rates and interest rates.

These financial exposures are monitored and managed by the Company as part of its overall risk management program.

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Foreign Exchange Risk Management

The Company hedges select anticipated foreign currency cash flows to reduce volatility in both cash flows and reported earnings.

The Company hedges select anticipated foreign currency cash flows to reduce volatility in both cash flows and reported earnings or losses.

The Company designates certain foreign exchange forward contracts as cash flow hedges.

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The Company measures the effectiveness of cash flow hedges of anticipated transactions on a spot-to-spot basis rather than on a forward-to-forward basis.

Accordingly, the spot-to-spot change in the derivative fair value will be deferred in AOCI and released and recorded in the Consolidated Statements of Operations in the same period that the hedged transaction is recorded.

Accordingly, the spot-to-spot change in the derivative fair value is deferred in AOCI and released and recorded in the Consolidated Statements of Operations in the same period that the hedged transaction is recorded.

The time-value component of the fair value of the derivative is reported on a straight-line basis in Cost of products sold in the Consolidated Statements of Operations in the period which it is applicable.

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Any cash flows associated with these instruments are included in operating activities in the Consolidated Statements of Cash Flows.

On May 26, 2020, the Company paid $ 31 million to settle the $ 150 million notional Treasury rate lock contract, which partially hedged the interest rate risk of the $ 750 million senior unsecured notes.

On May 26, 2020, the Company paid $ 31 million to settle the $ 150 million notional Treasury rate lock contract, which partially hedged the interest rate risk of the $ 750 million Senior Notes due June 2030.

This loss is amortized over the ten-year life of the notes.

As of December 31, 2024 and December 31, 2023, $ 16 million and $ 19 million, respectively, of this loss is remaining to be amortized from AOCI in future periods.

Overall, the derivatives designated as cash flow hedges are highly effective for accounting purposes.

Overall, the derivatives designated as cash flow hedges are considered to be highly effective for accounting purposes.

At December 31, 2024, the Company expects to reclassify $ 3 million of deferred net losses on cash flow hedges recorded in AOCI in the Consolidated Statements of Operations during the next 12 months.

For the rollforward of derivative instruments designated as cash flow hedges in AOCI see Note 5, Comprehensive (Loss) Income.

For the rollforward of derivative instruments designated as cash flow hedges in AOCI, see Note 5, Comprehensive Loss.

Hedges of Net Investments in Foreign Operations

The Company has significant investments in foreign subsidiaries.

The net assets of these subsidiaries are exposed to volatility in currency exchange rates.

The Company employs both derivative and non-derivative financial instruments to hedge a portion of this exposure.

The net assets of these subsidiaries are exposed to volatility in foreign currency exchange rates.

The Company employs both derivative and non-derivative financial instruments to hedge a portion of these exposures.

The derivative instruments consist of foreign exchange forward contracts and cross-currency basis swaps.

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Translation gains and losses related to the net assets of the foreign subsidiaries are offset by gains and losses in the aforementioned instruments, which are designated as hedges of net investments, and the intrinsic value changes in these instruments are recorded on AOCI, net of tax effects.

The time-value component of the fair value of the derivative instruments is reported on a straight-line basis in Other expense (income), net in the Consolidated Statements of Operations in the applicable period.

The time-value component of the fair value of the derivative instrument is amortized on a straight-line basis in Other (income) expense, net in the Consolidated Statements of Operations in the applicable period.

Any cash flows associated with these instruments are included in investing activities in the Consolidated Statements of Cash Flows, except for derivative instruments that include an other-than-insignificant financing element, for which all cash flows are classified as financing activities in the Consolidated Statements of Cash Flows.

The fair value of the foreign exchange forward contracts and cross-currency basis swaps is the estimated amount the Company would receive or pay at the reporting date, considering the effective interest rates, and foreign exchange rates.

The fair value of the foreign currency exchange forward contracts and cross-currency basis swaps is the estimated amount the Company would receive or pay at the reporting date, taking into account the effective interest rates and foreign exchange rates.

The effective portion of the change in the value of these derivatives is recorded in AOCI, net of tax effects.

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The cross-currency basis swap is designated as a hedge of net investments.

This contract effectively converts a portion of the $ 750 million bond coupon from 3.3 % to 1.7 %, which will result in a net reduction of Other expense (income), net.

This contract effectively converts a portion of the $ 750 million bond coupon from 3.3 % to 1.7 %, which will result in a net reduction of Other (income) expense, net.

On May 25, 2021, the Company re-established its euro net investment hedge portfolio by entering into eight foreign exchange forward contracts, each with a notional amount of 10 million euro.

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This net investment hedge was settled in September 2023 which resulted in cash receipts totaling $ 32 million.

The Company subsequently entered into Swiss franc foreign exchange contracts designated as a net investment hedge with a total notional amount of 600 million Swiss francs.

The Company subsequently entered into Swiss franc foreign exchange contracts designated as net investment hedges with a total notional amount of 600 million Swiss francs.

This portfolio of contracts has semi-annual maturity dates through July 2028.

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Foreign Exchange Risk Management

The Company has intercompany loans denominated in Swedish kronor that are exposed to volatility in currency exchange rates.

The Company has intercompany loans denominated in Swedish kronor that are exposed to volatility in foreign currency exchange rates.

The Company employs derivative financial instruments to hedge these exposures.

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The Company measures the effectiveness of fair value hedges of anticipated transactions on a spot-to-spot basis rather than on a forward-to-forward basis.

Accordingly, the spot-to-spot change in the derivative fair value will be recorded in Other expense (income), net in the Consolidated Statements of Operations.

The time-value component of the fair value of the derivative is reported on a straight-line basis in Other expense (income), net in the Consolidated Statements of Operations in the applicable period.

Accordingly, the spot-to-spot change in the derivative fair value will be recorded in Other (income) expense, net in the Consolidated Statements of Operations.

The time-value component of the fair value of the derivative is reported on a straight-line basis in Other (income) expense, net in the Consolidated Statements of Operations in the applicable period.

Any cash flows associated with these instruments are included in operating activities in the Consolidated Statements of Cash Flows.

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The Company primarily uses foreign exchange forward contracts to hedge these risks.

The gains and losses on these derivative transactions offset the gains and losses generated by the revaluation of the underlying non-functional currency balances and are recorded in Other expense (income), net in the Consolidated Statements of Operations.

The gains and losses on these derivative transactions offset the gains and losses generated by the revaluation of the underlying non-functional currency balances and are recorded in Other (income) expense, net in the Consolidated Statements of Operations.

Any cash flows associated with these instruments are included in operating activities in the Consolidated Statements of Cash Flows.

Gains and losses recorded in the Company’s Consolidated Statements of Operations related to the derivative instruments not designated as hedges for the years ended December 31, 2024 and 2023 were not significant.

Derivative Instrument Activity

The effect of derivative hedging instruments on the Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income:

The effect of derivative hedging instruments on the Consolidated Statements of Operations and Consolidated Statements of Comprehensive Loss were as follows:

Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022

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Interest rate swaps — 3 — — 3 — — 3 —

(Gain) loss on Hedges of Net Investment

Gain on Hedges of Net Investment

Cross currency basis swaps $ — $ — $ ( 5 ) $ — $ — $ ( 5 ) $ — $ — $ ( 5 )

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Hedges of Net Investments

Cross currency basis swaps $ ( 18 ) $ 30 $ 13 Other expense (income), net $ — $ — $ —

Foreign exchange forward contracts ( 29 ) 11 10 Other expense (income), net — — —

Cross currency basis swaps $ 11 $ ( 18 ) $ 30 Other (income) expense, net $ — $ — $ —

Foreign exchange forward contracts 37 ( 29 ) 11 Other (income) expense, net — — —

Fair Value Hedges

Interest rate swaps $ — $ — $ — Other expense (income), net $ — $ — $ —

Interest rate swaps $ — $ — $ — Other (income) expense, net $ — $ — $ —

Foreign exchange forward contracts — 2 ( 2 ) Interest expense, net — — —

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Balance Sheet Offsetting

Substantially all the Company’s derivative contracts are subject to netting arrangements;

whereby the right to offset occurs in the event of default or termination in accordance with the terms of the arrangements with the counterparty.

Substantially all of the Company’s derivative contracts are subject to netting arrangements, whereby the right to offset occurs in the event of default or termination in accordance with the terms of the arrangements with the counterparty.

While these contracts contain the enforceable right to offset through netting arrangements with the same counterparty, the Company elects to present them on a gross basis in the Consolidated Balance Sheets.

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NOTE 20 - FAIR VALUE MEASUREMENT

The estimated fair value and carrying value of the Company’s total debt was $ 2,018 million and $ 2,118 million, respectively, at December 31, 2023.

At December 31, 2022, the estimated the fair value and carrying value was $ 1,769 million and $ 1,944 million, respectively.

The fair value of long-term debt is based on recent trade information in the financial markets of the Company’s public debt or is determined by discounting future cash flows using interest rates available at December 31, 2023 to companies with similar credit ratings for issues with similar terms and maturities.

The estimated fair and carrying values of the Company’s total debt were $ 2,037 million and $ 2,135 million, respectively, at December 31, 2024.

At December 31, 2023, the estimated fair and carrying values were $ 2,018 million and $ 2,118 million, respectively.

The fair value of long-term debt is determined by discounting future cash flows using interest rates available at December 31, 2024 to companies with similar credit ratings for issuances with similar terms and maturities.

It is considered a Level 2 fair value measurement for disclosure purposes.

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Derivative valuations are based on observable inputs to the valuation model including interest rates, foreign currency exchange rates, and credit risks.

The Company utilizes interest rates swaps and foreign exchange forward contracts that are considered cash flow hedges.

In addition, the Company at times employs certain cross currency interest rate swaps and foreign exchange forward contracts that are considered hedges of net investment in foreign operations.

Both types of designated derivative instruments are further discussed in Note 19, Financial Instruments and Derivatives.

There were no transfers between fair value measurement levels during the years ended December 31, 2024 and 2023.

Assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (level 3)

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Balance, December 31, 2022 $ 4

Payments ( 6 )

Balance, December 31, 2023 $ 4

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Contingencies

On June 7, 2018, and August 9, 2018, two putative class action suits were filed, and later consolidated, in the Supreme Court of the State of New York, County of New York claiming that the Company and certain individual defendants, violated U.S.

securities laws (the “State Court Action”) by making material misrepresentations and omitting required information in the December 4, 2015 registration statement filed with the SEC in connection with the 2016 merger of Sirona Dental Systems Inc.

On December 19, 2018, a putative class action was filed in the U.S.

District Court for the Eastern District of New York (the “EDNY Court”) against the Company and certain individual defendants.

The case was narrowed following its inception.

The plaintiff’s claims which, as discussed below, have now been settled in principal, are that the Company and certain individual defendants violated U.S.

securities laws by making material misrepresentations and omitting required information in the December 4, 2015 registration statement filed with the SEC in connection with the 2016 merger of Sirona Dental Systems Inc.

(“Sirona”) with DENTSPLY International Inc.

(the “Merger”).

The amended complaint alleges that the defendants failed to disclose, among other things, that a distributor had purchased excessive inventory of legacy Sirona products and that three distributors of the Company’s products had been engaging in anticompetitive conduct.

The plaintiffs seek to recover damages on behalf of a class of former Sirona shareholders who exchanged their shares for shares of the Company’s stock in the Merger.

On September 26, 2019, the Court granted the Company’s motion to dismiss all claims and a judgment dismissing the case was subsequently entered.

On February 4, 2020, the Court denied plaintiffs’ post-judgment motion to vacate or modify the judgment and to grant them leave to amend their complaint.

The plaintiffs appealed the dismissal and the denial of the post-judgment motion to the Supreme Court of the State of New York, Appellate Division, First Department, and the Company cross-appealed select rulings in the Court’s decision dismissing the action.

The plaintiffs’ appeals and the Company’s cross-appeal were consolidated and argued on January 12, 2021.

On February 2, 2021, the Appellate Division issued its decision upholding the dismissal of the State Court Action with prejudice on statute of limitations grounds.

The Plaintiffs did not appeal the Appellate Division decision.

On December 19, 2018, a related putative class action was filed in the U.S.

District Court for the Eastern District of New York against the Company and certain individual defendants.

The plaintiff makes similar allegations and asserts the same claims as those asserted in the State Court Action.

(the “Merger”) and that the defendants failed to disclose, among other things, that a distributor had purchased excessive inventory of legacy Sirona products.

In addition, the plaintiff alleges that the defendants violated U.S.

securities laws by making false and misleading statements in quarterly and annual reports and other public statements between February 20, 2014, and August 7, 2018.

The plaintiff asserts claims on behalf of a putative class consisting of (a) all purchasers of the Company’s stock during the period February 20, 2014 through August 7, 2018 and (b) former shareholders of Sirona who exchanged their shares of Sirona stock for shares of the Company’s stock in the Merger.

securities laws by making false and misleading statements in quarterly and annual reports and other public statements between May 6, 2016 and August 7, 2018.

The plaintiff asserts claims on behalf of a putative class consisting of all purchasers of the Company's stock during the period from December 8, 2015 through August 6, 2018.

The Company moved to dismiss the amended complaint on August 15, 2019.

The plaintiff filed its second amended complaint on January 22, 2021, and the Company filed a motion to dismiss the second amended complaint on March 8, 2021, with briefing on the motion fully submitted on May 21, 2021.

The Company’s motion to dismiss was denied in a ruling by the Court on March 29, 2023 and the Company’s answer to the second amended complaint was filed on May 12, 2023.

On September 29, 2023, the plaintiff filed a motion for class certification.

The Company’s opposition to the plaintiff’s motion for class certification was filed on February 8, 2024, with briefing on the plaintiff’s motion to be fully completed by April 10, 2024.

The Company’s motion to dismiss was denied in a ruling by the EDNY Court on March 29, 2023, and the Company’s answer to the second amended complaint was filed on May 12, 2023.

Following additional motion practice — which remained outstanding with the EDNY Court — and discovery, the parties engaged in settlement discussions with the assistance of a mediator, and, in January 2025, reached a settlement in principal to resolve the case in full for $ 84 million, of which the Company expects to receive an offsetting insurance receivable of approximately $ 78 million while paying the rest in cash.

A binding term sheet for the settlement has been signed, which is subject to negotiation and approval by the EDNY Court of a full settlement agreement.

The excess of the settlement liability as of December 31, 2024 over the corresponding insurance policy receivable resulted in $ 6 million of legal expense which was recorded during the period.

On June 2, 2022, the Company was named as a defendant in a putative class action filed in the U.S.

District Court for the Southern District of Ohio captioned City of Miami General Employees’ & Sanitation Employees’ Retirement Trust v.

2:22-cv-02371 (S.D.

Ohio), and on July 28, 2022, the Company was named as a defendant in a putative class action filed in the U.S.

District Court for the Southern District of New York captioned San Antonio Fire and Police Pension Fund v.

2:22-cv-02371, and on July 28, 2022, the Company was named as a defendant in a putative class action filed in the U.S.

District Court for the Southern District of New York (the “SDNY Court”) captioned San Antonio Fire and Police Pension Fund v.

Dentsply Sirona Inc.

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securities laws by, among other things, making materially false and misleading statements or omissions, including regarding the manner in which the Company recognized revenue tied to distributor rebate and incentive programs.

On March 27, 2023, the Court in the Southern District of Ohio ordered the transfer of the putative class action to the Southern District of New York (the “Court”).

On June 1, 2023, the Court consolidated the two separate actions under case No.

1:22-cv-06339 and appointed the City of Birmingham Retirement and Relief System, the El Paso Firemen & Policemen’s Pension Fund, and the Wayne County Employees’ Retirement System as Lead Plaintiffs for the putative class.

On March 27, 2023, the Court in the Southern District of Ohio ordered the transfer of the putative class action to the SDNY Court.

On June 1, 2023, the SDNY Court consolidated the two separate actions under case No.

1:22-cv-06339 and appointed as lead plaintiffs for the putative class the City of Birmingham Retirement and Relief System, the El Paso Firemen & Policemen’s Pension Fund, and the Wayne County Employees’ Retirement System (collectively, the “Lead Plaintiffs”).

Lead Plaintiffs filed an amended class action complaint on July 28, 2023 (the “Amended Complaint”).

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Lead Plaintiffs’ opposition to Defendants’ motion to dismiss was filed on December 8, 2023, and Defendants’ reply was filed on January 8, 2024.

The motion to dismiss is still pending.

In addition to the Securities Litigation, as previously disclosed, the Company voluntarily contacted the SEC following the Company’s announcement on May 10, 2022, of the Audit and Finance Committee’s internal investigation.

The motion to dismiss was granted as to Mr.

Chadha and granted in part and denied in part as to the Company, Mr.

Casey, and Mr.

Gomez in a ruling by the SDNY Court on May 1, 2024.

The Company’s answer to the Amended Complaint was filed on May 21, 2024.

On November 15, 2024, Lead Plaintiffs filed a motion to certify the matter as a class action, to appoint Lead Plaintiffs as class representatives, and to appoint Robbins Geller Rudman & Dowd LLP as class counsel.

Defendants’ opposition to Lead Plaintiffs’ motion was filed on December 20, 2024, and Lead Plaintiffs’ reply is due on February 28, 2025.

In addition to the Securities Litigation, as previously disclosed, the Company voluntarily contacted the SEC following the Company’s announcement on May 10, 2022 of the internal investigation by the Audit and Finance Committee of the Company’s Board of Directors.

The Company continues to cooperate with the SEC regarding this matter.

Separately, on July 13, 2023, Dentsply Sirona stockholder George Presura filed a shareholder derivative suit in the Delaware Court of Chancery captioned George Presura, Derivatively on Behalf of Nominal Defendant Dentsply Sirona Inc.

Separately, on July 13, 2023, Dentsply Sirona stockholder George Presura filed a stockholder derivative suit in the Delaware Court of Chancery captioned George Presura, Derivatively on Behalf of Nominal Defendant Dentsply Sirona Inc.

and Dentsply Sirona, Inc., No.

2023-0708-NAC (the “Derivative Litigation”).

2023-0708-NAC (the “Presura Derivative Litigation”).

The complaint, filed derivatively on behalf of the Company, asserts claims against current and former members of the Company’s Board of Directors and current and former executive officers, including Messrs.

Casey and Gomez.

The derivative complaint in this case contains allegations similar to those in the Securities Litigation, and it alleges that during the period from June 9, 2021 through July 13, 2023, various of the defendants breached fiduciary duties, committed corporate waste, and misappropriated information to conduct insider trading by making materially false and misleading statements or omissions regarding the Company’s recognition of revenue tied to distributor rebate and incentive programs and distributor inventory levels.

On August 4, 2023, the Delaware Court of Chancery stayed the Derivative Litigation until the earlier of a public announcement of a settlement of the Securities Litigation or a resolution of the pending motion to dismiss in the Securities Litigation.

The derivative complaint in

this case contains allegations similar to those in the Securities Litigation, and it alleges that during the period from June 9, 2021 through July 13, 2023, various of the defendants breached fiduciary duties, committed corporate waste, and misappropriated information to conduct insider trading by making materially false and misleading statements or omissions regarding the Company’s recognition of revenue tied to distributor rebate and incentive programs and distributor inventory levels.

On August 4, 2023, the Delaware Court of Chancery stayed the Presura Derivative Litigation until the earlier of public announcement of a settlement of the Securities Litigation or resolution of the pending motion to dismiss in the Securities Litigation.

Additionally, on March 26, 2024, Dentsply Sirona stockholder Calvin Snee filed a stockholder derivative suit in the Delaware Court of Chancery captioned Calvin Snee, derivatively on behalf of Dentsply Sirona Inc.

Casey Jr., et al.

and Dentsply Sirona Inc, No.

2024-0308 (the “Snee Derivative Litigation”).

Casey and Gomez.

The derivative complaint in this case contains allegations similar to those in the Presura Derivative Litigation and the Securities Litigation, and it alleges that beginning in 2021, various of the defendants breached fiduciary duties, misappropriated information to conduct insider trading, and were unjustly enriched by making materially false and misleading statements or omissions regarding the Company’s recognition of revenue tied to distributor rebate and incentive programs and distributor inventory levels.

On May 2, 2024, the Delaware Court of Chancery issued an order consolidating and staying the Presura Derivative Litigation and Snee Derivative Litigation.

On July 19, 2024, Dentsply Sirona stockholder Frank Manfre filed a stockholder derivative suit in the Delaware Court of Chancery captioned Frank Manfre, derivatively on behalf of nominal defendant Dentsply Sirona Inc.

and Dentsply Sirona Inc., No.

2024-0763 (the “Manfre Derivative Litigation”).

The complaint asserts claims against current and former members of the Company’s Board of Directors and current and former executive officers, including Messrs.

Casey and Gomez.

The complaint in this case contains allegations similar to those in the Snee Derivative Litigation, the Presura Derivative Litigation, and the Securities Litigation, and it alleges that beginning in 2021, various of the defendants breached fiduciary duties, misappropriated information to conduct insider trading, and were unjustly enriched by making materially false and misleading statements or omissions regarding the Company’s recognition of revenue tied to distributor rebate and incentive programs and distributor inventory levels.

On September 19, 2024, the Delaware Court of Chancery issued an order consolidating and staying the Manfre Derivative Litigation, Presura Derivative Litigation, and Snee Derivative Litigation.

On November 26, 2024, the Company was named as a defendant in a putative class action filed in the SDNY Court captioned North Collier Fire Control and Rescue District Firefighters’ Retirement Plan v.

Dentsply Sirona Inc., et al., No.

1:24-cv-09083 (the “North Collier Action”).

On December 18, 2024, the Company was named as a defendant in a putative class action filed in the SDNY Court captioned Calvin v.

Dentsply Sirona Inc., et al., No.

1:24-cv-09764 (the “Calvin Action”), and on December 19, 2024, the Company was named as a defendant in a putative class action filed in the SDNY Court captioned Key West Police & Fire Pension Fund v.

Dentsply Sirona Inc., et al., No.

1:24-cv-09819 (the “Key West Action”).

The complaints in these three cases allege that, for different alleged class periods over the period from May 6, 2021 through November 6, 2024, the Company and certain current and former officers violated U.S.

securities laws by, among other things, making materially false and misleading statements or omissions, including regarding the performance of the Company’s Byte aligners business, following the Company’s acquisition of Byte LLC in December 2020.

On February 21, 2025, the SDNY Court entered an order consolidating the North Collier Action, the Calvin Action, and the Key West Action under the caption In re Dentsply Sirona, Inc.

Securities Litigation, No.

24-cv-9083, and appointing HANSAINVEST Hanseatische Investment-Gesellschaft mit beschränkter Haftung and City of Miami General Employees’ & Sanitation Employees’ Retirement Trust as lead plaintiffs (“Lead Plaintiffs”) and Bernstein Litowitz Berger & Grossmann LLP as lead counsel for the consolidated case.

The SDNY Court ordered the Lead Plaintiffs to file an amended complaint by April 7, 2025.

On March 21, 2023, Mr.

Carlo Gobbetti filed a claim in the Milan Chamber of Arbitration against Dentsply Sirona Italia S.r.l.

(“DSI”), Italy, a wholly owned subsidiary of the Company, seeking a total of € 28 million for the alleged failure to pay a portion of the purchase price pursuant to a Share Purchase Agreement, dated October 8, 2012 (the “SPA”), in which Sirona Dental Systems, S.r.l., which at the time of the SPA’s execution was a wholly-owned subsidiary of Sirona Dental Systems, Inc., acquired all of the shares of MHT S.p.A., an Italian corporation, from Mr.

(“DSI”), Italy, a wholly owned subsidiary of the Company, seeking a total of € 28 million for the alleged failure to pay a portion of the purchase price pursuant to a Share Purchase Agreement, dated October 8, 2012 (the “SPA”), in which Sirona Dental Systems, S.r.l., which at the time of execution of the SPA was a wholly-owned subsidiary of Sirona Dental Systems, Inc., acquired all of the shares of MHT S.p.A., an Italian corporation, from Mr.

Gobbetti, and various other sellers.

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in 2018 (the surviving entity is now Dentsply Sirona Italia S.r.l.).

In connection with the closing of that transaction, SIRONA Dental Systems GmbH paid an amount equal to € 7 million into an escrow account (the “Escrow Account”).

The proceeds of the Escrow Account were to be released to Mr.

Under the SPA, a portion of the purchase price equal to € 7 million was required to be deposited into an escrow account (the “Escrow Account”) and released to Mr.

Gobbetti and the other sellers upon the satisfaction of certain conditions, including the delivery by July 2013 of a new prototype of an MHT S.p.A.

camera which had to meet certain specifications.

In connection with the

closing of the share purchase transaction, the SPA was supplemented by a Facility Agreement, also dated October 8, 2012 (the “FA”), which specifically set out the mechanics of payment and release of the proceeds of the Escrow Account.

The Austrian notary public, Mr.

Gottfried Schachinger, acting as escrow agent, Mr.

Gobbetti, and SIRONA Holdings GmbH, an affiliate of Sirona Dental Systems, Inc.

which paid the € 7 million into the Escrow Account, were parties to the FA.

The FA is subject to Austrian law and to the jurisdiction of the Court of Salzburg in Austria.

Gobbetti claims that he is entitled to receive the € 7 million outstanding balance of the purchase price under the SPA, plus € 21 million for damages incurred as a consequence of the failure to make the payment.

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Gobbetti and the other sellers were entitled to receive the funds deposited in the Escrow Account and further disputing the allegations.

Following the constitution of the arbitral tribunal, hearings were held on September 13, 2023 and January 19, 2024, to illustrate and discuss their respective positions.

The Parties were also permitted to further develop their arguments in one additional round of defensive briefs.

On January 29, 2024, the Parties filed a statement setting out their final pleadings.

The Arbitral Court eventually decided that the procedural issues raised by DSI (jurisdiction, capacity to be sued) will be considered together with the merits and granted the Parties final deadlines to file their respective final briefs (March 29, 2024) and replies (April 15, 2024).

The final hearing has been scheduled for May 8, 2024.

Following the constitution of the arbitral tribunal, hearings were held on September 13, 2023 and January 19, 2024, to illustrate and discuss the positions of the parties.

The parties also developed their arguments in several rounds of defensive briefs.

The final submissions were completed on April 15, 2024 and the final hearing for discussion took place on May 8, 2024.

On July 22, 2024, the arbitral tribunal rejected all of Mr.

Gobbetti’s claims, ruling that the Company had met its contractual obligations under the SPA, particularly regarding the balance of the purchase price.

The arbitral tribunal also dismissed Mr.

Gobbetti’s claims in tort and those pertaining to the FA for lack of jurisdiction and lack of capacity for the Company to be sued.

The arbitral tribunal observed that such claims should have been brought against SIRONA Holdings GmbH, which is a party to the FA but not to the SPA, before the Court of Salzburg in Austria based on the jurisdictional clause of the FA.

Gobbetti appealed the ruling of the arbitral tribunal on December 2, 2024 before the Court of Appeals of Milan, Italy (the “Court of Appeals”) arguing that the ruling is null and void.

According to Mr.

Gobbetti, the arbitral tribunal did not grant him appropriate defense rights under the Italian Civil Code and did not fully address the merits of his claims, despite acknowledging jurisdiction.

Gobbetti asked the Court of Appeals to directly sentence DSI to pay the € 7 million, plus damages of € 21 million.

DSI must submit its defense by March 20, 2025.

Except as noted above, no specific amounts of damages have been alleged in these lawsuits.

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The expense of continuing to defend such litigation may be significant.

The Company intends to defend these lawsuits vigorously, but there can be no assurance that the Company will be successful in any defense.

If any of the lawsuits are decided adversely, the Company may be liable for significant damages directly or under our indemnification obligations, which could adversely affect our business, results of operations and cash flows.

At this stage, the Company is unable to assess whether any material loss or adverse effect is reasonably possible as a result of these lawsuits or estimate the range of any potential loss.

The Internal Revenue Service (“IRS”) conducted an examination of the U.S.

federal income tax returns for tax years 2012 through 2014.

In February 2019, the IRS issued to the Company a “30-day letter” and a Revenue Agent’s Report (“RAR”), relating to the Company’s worthless stock deduction in 2013 in the amount of $ 546 million.

The RAR disallows the deduction and, after adjusting the Company’s net operating loss carryforward, asserts that the Company is entitled to a refund of $ 5 million for 2012, has no tax liability for 2013, and owes a deficiency of $ 17 million in tax for 2014, excluding interest.

In accordance with ASC 740, the Company recorded the tax benefit associated with the worthless stock deduction in the Company’s 2012 financial statements.

In March 2019, the Company submitted a formal protest disputing on multiple grounds the proposed taxes.

The Company and its advisors discussed its position with the IRS Independent Office of Appeals (the “Appeals Office”) in October 2020, and in November 2020 submitted a supplemental response to questions raised by the Appeals Office.

During the first quarter of 2023, after an extended review by the Appeals Office, the Company received a notice from the IRS, allowing the Company’s worthless stock deduction for tax year 2013.

As a result, the Company received a refund of $ 5 million for tax year 2012 with no further adjustments to the 2013 or 2014 tax return.

The IRS is conducting an examination of our U.S.

federal income tax returns for the tax years 2015 through 2016.

The Company intends to defend these lawsuits vigorously, although the Company may elect to settle certain litigation matters, but there can be no assurance that the Company will be successful in any defense or that matters can be settled on terms favorable to the Company.

If any of the lawsuits are decided adversely, the Company may be liable for significant damages directly or under its indemnification obligations, which could adversely affect the Company’s business, results of operations and cash flows.

At this stage, the Company has accrued losses which are deemed probable, along with related insurance receivables, but the Company is unable to assess whether any incremental material loss or adverse effect is reasonably possible as a result of these lawsuits or estimate the range of any potential loss.

The Internal Revenue Service (“IRS”) is conducting an examination of the Company’s U.S.

federal income tax returns for the tax years 2015 and 2016.

The Company received a Notice of Proposed Adjustment in April 2023 and a Revenue Agent Report in January 2024 from the IRS examination team proposing an adjustment related to an internal reorganization completed in 2016 with respect to the integration of certain operations of Sirona Dental Systems, Inc.

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Although the proposed adjustment does not result in any additional federal income tax liability for the internal reorganization, if sustained, the proposed adjustment would result in the Company owing additional federal income taxes on a distribution of $ 451 million related to a stock redemption that occurred after the internal reorganization was completed in 2016.

The amount of additional federal income taxes due for 2016 is approximately $ 2 million, excluding interest.

The proposed adjustment, if sustained, would also result in a loss of foreign tax credits carried forward to later tax years.

We believe that we accurately reported the federal income tax consequences of the internal restructuring and stock redemption in our tax returns and will submit an administrative protest with the IRS Independent Office of Appeals contesting the examination team’s proposed adjustments.

We intend to vigorously defend our reported positions and believe that it is more likely than not that our position will be sustained.

The Company has not accrued a liability relating to the proposed tax adjustments.

However, the outcome of this dispute involves a number of uncertainties, including those relating to the application of the Internal Revenue Code and other federal income tax authorities and judicial precedent.

Accordingly, there can be no assurance that the dispute with the IRS will be resolved favorably.

The Company intends to vigorously defend its positions and pursue related appeals, where appropriate, in the above-described pending matters.

The Company believes that it accurately reported the federal income tax consequences of the internal restructuring and stock redemption in its tax returns and in April 2024, submitted an administrative protest with the IRS Independent Office of Appeals contesting the examination team’s proposed adjustments.

The IRS examination team provided the Company with a rebuttal to the Company’s administrative protest during August 2024 and informed the Company that the dispute would be forwarded to the IRS Independent Office of Appeals.

The General Public Prosecutor’s Office Frankfurt am Main is investigating a series of intercompany loans implemented in 2016 and 2017 as part of the post-merger integration activities of DENTSPLY International Inc.

and Sirona Dental Systems, Inc.

The Company is cooperating with the investigation.

The Company believes that the transactions at issue complied with all applicable German laws.

No charges have been filed against the Company or any individuals.

The Company intends to vigorously defend its positions and pursue related appeals in the above-described pending matters and believes it is more likely than not that its positions will be sustained, although the Company may elect to settle certain matters.

Unless otherwise disclosed herein, the Company has not accrued losses for these matters because the Company does

not believe the risk of loss is probable and cannot estimate the range of any potential loss with any reasonable degree of accuracy.

In addition to the matters disclosed above, the Company is, from time to time, subject to a variety of litigation and similar proceedings incidental to its business.

These legal matters primarily involve claims for damages arising out of the use of the Company’s products and services and claims relating to intellectual property matters including patent infringement, employment matters, tax matters, commercial disputes, competition and sales and trading practices, personal injury, and insurance coverage.

The Company may also become subject to lawsuits because of past or future acquisitions or as a result of liabilities retained from, or representations, warranties or indemnities provided in connection with, divested businesses.

Some of these lawsuits may include claims for punitive, consequential, and compensatory damages.

Except as otherwise noted, the Company generally cannot predict the eventual outcomes, the timing of the ultimate resolutions, or the eventual loss, fines or penalties related to these pending matters.

The Company may also become subject to lawsuits as a result of past or future acquisitions or as a result of liabilities retained from, or representations, warranties or indemnities provided in connection with, divested businesses.

Some of these lawsuits may include claims for punitive and consequential, as well as compensatory, damages.

Except as otherwise noted, the Company generally cannot predict what the eventual outcome of the above-described pending matters will be, what the timing of the ultimate resolution of these matters will be, or what the eventual loss, fines or penalties related to each pending matter may be.

Based upon the Company’s experience, current information, and applicable law, it does not believe that these proceedings and claims will have a material adverse effect on its consolidated results of operations, financial position, or liquidity.

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The Company has certain non-cancelable future commitments primarily related to long-term supply contracts for key components and raw materials.

At December 31, 2023, non-cancelable purchase commitments are as follows:

At December 31, 2024, non-cancelable purchase commitments were as follows:

(in millions)

The table above includes commitments under the Company’s agreement with a cloud services provider supporting the Company’s digital platform which requires minimum purchases totaling $ 85 million through 2028.

Off-Balance Sheet Arrangements

As of December 31, 2023, we had no material off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our consolidated financial condition, results of operations, liquidity, capital expenditures or capital resources other than certain items disclosed in the sections above.

As of December 31, 2024, the Company had no material off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on the Company’s consolidated financial condition, results of operations, liquidity, capital expenditures or capital resources other than certain items disclosed in the sections above.

Indemnification

In the normal course of business to facilitate sales of our products and services, we indemnify certain parties:

customers, vendors, lessors, and other parties with respect to certain matters, including, but not limited to, services to be provided by us and intellectual property infringement claims made by third parties.

In addition, we have indemnification agreements with our directors and our executive officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers.

In the normal course of business to facilitate sales of the Company’s products and services, the Company indemnifies certain parties, including customers, vendors, lessors, services providers, and others, with respect to certain matters, including, but not limited to, services to be provided by or for the Company, and intellectual property infringement claims made by third parties.

In addition, the Company has entered into indemnification agreements with its directors and its executive officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their

status or service as directors or officers.

Several of these agreements limit the time within which an indemnification claim can be made and the amount of the claim.

It is not possible to make a reasonable estimate of the maximum potential amount under these indemnification agreements due to the unique facts and circumstances involved in each agreement.

Additionally, we have a limited history of prior indemnification claims and the payments made under such agreements have not had a material effect on our results of operations, cash flows or financial position.

Except as noted in the “Contingencies” section herein, as of December 31, 2023, we did not have any material indemnification claims that were probable or reasonably possible.

However, to the extent that valid indemnification claims arise in the future, future payments by us could be significant and could have a material adverse effect on our results of operations or cash flows in a particular period.

It is not possible to make a reasonable estimate of the maximum potential amount of indemnification under these indemnification agreements due to the unique facts and circumstances involved in each particular agreement.

Additionally, the Company has a limited history of prior indemnification claims, and the payments made under such agreements have not had a material effect on the Company’s results of operations, cash flows or financial position.

Except as noted in the “Contingencies” section herein, as of December 31, 2024, the Company did not have any material indemnification claims that were probable or reasonably possible.

However, to the extent that valid indemnification claims arise in the future, future payments by the Company could be significant and could have a material adverse effect on the Company’s results of operations or cash flows in a particular period.

DENTSPLY SIRONA INC.

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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-K

Item 8. Financial Statements and Supplementary Data