STRYKER CORPSYK

STRYKER CORP Goodwill & Intangibles Disclosure

10-KFiled Feb 11, 20263 min read
GOODWILL AND OTHER INTANGIBLE ASSETS
In our annual impairment test of goodwill as of October 31, 2024
we performed a quantitative assessment of the Spine reporting
unit using a discounted cash flow analysis to estimate the fair
value. The carrying value of the Spine reporting unit exceeded its
fair value and a charge of $273 was recognized in goodwill and
other impairments in the Consolidated Statements of Earnings.
The impairment charge for the Spine reporting unit was driven by
a decrease in future product demand due to the competitive
environment and an increase in the Spine reporting unit’s
weighted average cost of capital. Subsequent to the annual
goodwill impairment test management committed to a plan to sell
certain assets associated with the Spinal Implants business
(disposal group). Goodwill was allocated to the disposal group
based on the relative fair values of the disposal group and the
portion of the Spine reporting unit that will be retained. Goodwill
allocated to the disposal group was tested for impairment which
resulted in an impairment charge of $183 recognized in goodwill
and other impairments in the Consolidated Statements of
Earnings. Refer to Note 16 for additional information on the sale
of the Spinal Implants business.
In our annual impairment test as of October 31, 2025 we
performed a quantitative impairment test for our Peripheral
Vascular reporting unit and determined that its fair value
exceeded its carrying amount by 12%. At October 31, 2025,
goodwill attributable to the Peripheral Vascular reporting unit was
$3,203. The fair value of this reporting unit was determined using
a discounted cash flow analysis, which is a form of the income
approach. Significant inputs to the analysis included assumptions
for future revenue growth, operating margin and the rate used to
discount the estimated future cash flows to their present value,
based on the reporting unit’s estimated weighted average cost of
capital.
For our other reporting units, we considered qualitative indicators
of impairment as it was considered more likely than not that the
fair values of those reporting units exceeded their respective
carrying values. No impairment was identified for those reporting
units in 2025 or 2024.
Future changes in the judgments, assumptions and estimates
that are used in our impairment testing for goodwill, including
discount and tax rates and future cash flow projections, could
result in different estimates of the fair values. A significant
reduction in the estimated fair values could result in impairment
charges that could materially affect our results of operations.
In 2024 goodwill of $117 previously reported within Orthopaedics
was reclassified to MedSurg and Neurotechnology to reflect the
reclassification of the Interventional Spine reporting unit from
Orthopaedics to MedSurg and Neurotechnology to align with
certain updates in our internal reporting structure.
Changes in the Net Carrying Value of Goodwill by Segment
MedSurg and
Neurotechnology
Orthopaedics
Total
2023
$8,270
$6,973
$15,243
Goodwill impairment
—
(456)
(456)
Additions and adjustments
852
300
1,152
Foreign exchange and other
86
(170)
(84)
2024
$9,208
$6,647
$15,855
Additions and adjustments
3,275
(1)
3,274
Foreign exchange and other
73
89
162
2025
$12,556
$6,735
$19,291
Summary of Other Intangible Assets
Gross
Carrying
Amount
Less
Accumulated
Amortization
Net
Carrying
Amount
Developed technologies
2025
$7,273
$3,430
$3,843
2024
5,698
2,931
2,767
Customer relationships
2025
$3,425
$1,844
$1,581
2024
3,055
1,636
1,419
Patents
2025
$157
$144
$13
2024
153
136
17
Trademarks
2025
$420
$281
$139
2024
413
256
157
In-process research and development
2025
$34
$—
$34
2024
34
—
34
Other
2025
$132
$61
$71
2024
63
62
1
Total
2025
$11,441
$5,760
$5,681
2024
9,416
5,021
4,395
Estimated Amortization Expense
2026
2027
2028
2029
2030
$699
$711
$631
$616
$597

Historical Timeline

Fiscal YearFiled
2025Feb 11, 2026Showing above
2024Feb 12, 2025
2023Feb 14, 2024
2022Feb 10, 2023
2021Feb 11, 2022
2020Feb 11, 2021
2019Feb 6, 2020
2018Feb 7, 2019
2017Feb 8, 2018
2016Feb 9, 2017
2015Feb 11, 2016

About Goodwill & Intangibles Disclosures

Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.

Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.

Other Available Disclosures

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