- Fourth-quarter sales from continuing operations of $2.75
billion increased 1% on a reported basis and 2% on a constant
currency basis, exceeding the company’s previously issued
guidance1
- Fourth-quarter U.S. GAAP2 diluted earnings per share (EPS)
(loss) from continuing operations of ($0.95); adjusted diluted EPS
from continuing operations of $0.58, exceeding the company’s
previously issued guidance
- Full-year sales from continuing operations of $10.64 billion
increased 3% on both a reported and constant currency basis,
exceeding the company’s previously issued guidance
- Full-year U.S. GAAP diluted EPS (loss) from continuing
operations of ($0.64); adjusted diluted EPS from continuing
operations of $1.89, exceeding the company’s previously issued
guidance
- Transformative sale of Kidney Care business now complete,
positioning company for next stage of growth and innovation
Baxter International Inc. (NYSE:BAX), a global medtech leader,
today reported results for the fourth quarter and full year ended
Dec. 31, 2024, and provided its financial guidance for
first-quarter and full-year 2025.
“Our 2024 performance and related strategic milestones reflect
Baxter’s growing momentum in our pursuit of enhanced value for
patients, healthcare providers, customers and shareholders,” said
Brent Shafer, chair and interim chief executive officer. “In
addition to delivering positive fourth-quarter and full-year
results, the recently completed sale of our Kidney Care business
concludes a range of transformative actions announced in early
2023. Today, as a streamlined, agile Baxter, we have new
opportunities to redefine healthcare delivery and drive profitable
growth. We’re powered by fundamentals that remain core to our
impact, including our diverse portfolio of medically essential
products and our sustained emphasis on customer-inspired
innovation.”
Fourth-Quarter Financial Results
Worldwide sales from continuing operations in the fourth quarter
totaled approximately $2.75 billion, increasing 1% on a reported
basis and 2% on a constant currency basis. Continuing operations
exclude Baxter’s Kidney Care business, which was acquired by
Carlyle on Jan. 31, 2025, and Baxter’s former BioPharma Solutions
(BPS) business, which was divested at the end of the third quarter
of 2023, and are both reported as discontinued operations.
U.S. sales from continuing operations in the fourth quarter
totaled approximately $1.51 billion, remaining flat on a reported
basis. International sales from continuing operations in the fourth
quarter totaled approximately $1.24 billion, an increase of 1% on a
reported basis and 3% at constant currency rates.
Top-line performance in the fourth quarter exceeded Baxter’s
previously announced guidance, driven by better-than-expected sales
in the company’s Medical Products & Therapies and
Pharmaceuticals segments.
- Medical Products & Therapies sales were flat at
reported rates and grew low single digits at constant currency
rates. Growth in the quarter reflected strong performance from the
company’s infusion systems product portfolio driven by robust sales
for the Novum IQ infusion pump, increased sales of
parenteral nutrition products and strong demand for Advanced
Surgery products. Performance in this segment was partially offset
by reduced sales of IV solutions, which, as expected, declined due
to the impact of Hurricane Helene. The impact from the Hurricane
was less than previously anticipated given the company's swift
recovery efforts, and contributed to the outperformance in the
quarter.
- Pharmaceuticals sales grew high single digits at both
reported and constant rates, driven by double-digit growth in
specialty injectables, reflecting continued momentum from recent
new product launches, and ongoing strength in Drug
Compounding.
- Healthcare Systems & Technologies sales declined, as
expected, by low single digits on a reported and constant currency
basis. Robust sales in the U.S. Care and Connectivity Solutions
(CCS) division were fueled by strength in the Patient Support
Systems business due to upgrades from existing customers and new
competitive wins. This strong performance was offset by select
product/market exits, a difficult comparison to the prior-year
period and certain supply constraints.
- Kidney Care sales, which are now reported in
discontinued operations, declined low single digits on a reported
basis and grew low single digits on a constant currency basis.
Please see the attached schedules accompanying this press
release for additional details on sales performance in the quarter,
including breakouts by Baxter’s segments.
For the fourth quarter, total net income (loss) attributable to
Baxter on a U.S. GAAP basis was ($512) million, or ($1.00) per
diluted share. Total U.S. GAAP diluted EPS includes ($0.95) from
continuing operations and ($0.05) from discontinued operations.
These results include special items totaling $908 million
after-tax, primarily related to the impact of a Front Line Care
goodwill impairment charge, intangible amortization, business
optimization costs, tax matters, Hurricane Helene costs and
separation-related costs, among other factors. On an adjusted
basis, net income from continuing operations was $0.58 per diluted
share, exceeding the company’s original guidance of $0.50 to $0.53
per diluted share. Results in the quarter came in favorable to
expectations due to strong operational performance, a lesser
negative impact from Hurricane Helene than previously anticipated
and a favorable tax rate. Income for total Baxter on an adjusted
basis, including discontinued operations, was $0.77 per diluted
share, within the company’s original guidance of $0.77 to $0.81 per
diluted share.
Full-Year Financial Results
Baxter’s 2024 worldwide sales from continuing operations totaled
$10.64 billion, an increase of 3% on both a reported and constant
currency basis. Sales from continuing operations in the U.S.
totaled $5.85 billion, growing 1% on a reported basis.
International sales from continuing operations of $4.79 billion
grew 5% on a reported basis and 6% at constant currency rates. The
accompanying schedules include additional details on sales
performance, including breakouts by Baxter’s segments.
For full-year 2024, net income (loss) attributable to total
Baxter on a U.S. GAAP basis was ($649) million, or ($1.27) per
diluted share. Total U.S. GAAP diluted EPS (loss) includes ($0.64)
from continuing operations and ($0.63) from discontinued
operations. These results include special items totaling $2.13
billion after-tax, which primarily reflected the impact of
intangible amortization, Chronic Therapies and Front Line Care
goodwill impairment charges, separation-related costs, business
optimization costs and tax matters, among other items. On an
adjusted basis, 2024 income from continuing operations totaled
$1.89 per diluted share. Total adjusted net income attributable to
Baxter totaled $1.48 billion or $2.90 per diluted share.
For the full year, Baxter generated $819 million in operating
cash flow from continuing operations and $373 million in free cash
flow (operating cash flow from continuing operations less capital
expenditures of $446 million).
“The recently completed Kidney Care sale is a major inflection
point in our journey to transform Baxter and create value for our
stakeholders,” said Joel Grade, executive vice president and chief
financial officer. “In line with our capital allocation priorities,
net after-tax proceeds from the transaction are being allocated
toward debt repayment, aligned with our objective of reaching our
net leverage target of approximately 3.0x by the end of 2025.
Looking ahead, our goal is to harness the opportunities created by
our newly streamlined profile and strategic trajectory with a focus
on improving our cash flow generation and investing in our
businesses to accelerate growth.”
Transformation Update and Senior Leadership Changes
Baxter completed the sale of its Kidney Care business, now known
as Vantive, to Carlyle for approximately $3.4 billion of net,
after-tax proceeds, exceeding previous expectations of $3.15 to
$3.25 billion, on Jan. 31, 2025. This transaction marks the final
stage of the strategic transformation Baxter announced in January
2023 to enhance operational effectiveness, accelerate innovation
for patients and drive value for shareholders. Additional
transformative actions announced at that time included the
implementation of a new vertical operating model and the
divestiture of Baxter’s non-core BioPharma Solutions business, both
completed in 2023.
With the three elements of the strategic transformation
complete, Baxter is positioned to move forward as a more
strategically focused and operationally efficient company, with a
unique opportunity to set the trajectory and vision for its next
phase. On Feb. 3, 2025, Baxter announced several key leadership
changes to usher the company into this new chapter. José (Joe) E.
Almeida, chair, president and chief executive officer (CEO),
retired from his executive roles with the company, creating the
opportunity for a new CEO to define Baxter’s future course. Mr.
Almeida will serve in an advisory capacity through Oct. 31, 2025.
The Baxter Board of Directors appointed former lead independent
director Brent Shafer as chair and interim CEO, and has initiated a
search for a permanent CEO. Additionally, Baxter appointed Heather
Knight to the role of executive vice president and chief operating
officer (COO). Ms. Knight will also serve as interim group
president, Medical Products & Therapies.
Hurricane Helene Recovery at North Cove Facility
On Sept. 27, 2024, Baxter’s North Cove, North Carolina,
manufacturing site was significantly impacted by flooding related
to an unprecedented rain and storm surge due to Hurricane Helene,
resulting in a temporary production shutdown. The North Cove and
broader Baxter teams, in coordination with government agencies,
focused immediately on supporting employees in affected
communities, bringing the facility back online, and working to help
ensure ongoing supply continuity for patients.
Thanks to the dedication and resilience of Baxter’s local and
global teams, all 10 of the site’s manufacturing lines have since
restarted, and North Cove is now producing at pre-hurricane levels.
The company expresses its deep gratitude to all who participated in
this recovery effort, within Baxter and beyond, and thanks its
customers for their patience as Baxter has worked to support supply
continuity as recovery has progressed.
Recent Highlights3
Baxter continues to advance key strategic priorities in pursuit
of its Mission to Save and Sustain Lives. Following are highlights
among many 2024 achievements across the company’s business
segments.
Medical Products & Therapies
- Received U.S. Food and Drug Administration (FDA) 510(k)
clearance of its Novum IQ large volume infusion pump (LVP)
with Dose IQ Safety Software. Adding LVP modality to the
Novum IQ Infusion Platform – which includes Baxter’s syringe
infusion pump (SYR) with Dose IQ Safety Software, powered by
the IQ Enterprise Connectivity Suite – integrates the user
experience across its LVP and SYR pumps and helps to reduce the
burden of non-critical tasks so that nurses, pharmacists, and other
clinicians can spend more time focused on patient care. Both the
Novum IQ LVP and Novum IQ SYR are available and in
use across the U.S.
- Announced U.S. FDA approval of an expanded indication for
Clinolipid (Lipid Injectable Emulsion) to be used in
pediatric patients, including preterm and term neonates.
Clinolipid is Baxter’s proprietary mixed oil lipid emulsion
that is used to provide calories and essential fatty acids in
parenteral (intravenous) nutrition (PN) when oral or enteral
nutrition is not possible, insufficient or contraindicated.
Clinolipid has been available in the U.S. for adults since
2019 and is now available for use in all ages.
Healthcare Systems & Technologies
- Launched its next generation airway clearance system, The
Vest Advanced Pulmonary Experience (APX) System, in the U.S.,
supporting daily therapy for adults and children with certain
chronic lung conditions and retained secretions. The system
features the same trusted airflow technology as the previous
version, with enhanced comfort and additional patient-centered
features driven by clinician and patient input.
Pharmaceuticals
- Announced 10 injectable pharmaceutical product launches in the
U.S. that reinforce Baxter’s focus on bringing high-value products
to market to help address critical patient needs across key
therapeutic areas, including critical care, anti-infectives, pain
and oncology.
Corporate Responsibility
Baxter continues to advance its life-sustaining mission through
efforts that demonstrate the company’s commitment to operating as a
socially responsible and sustainable business and an employer of
choice. The company is focused on creating value for its
stakeholders through its overarching pledge to “Empower our
Patients,” “Protect our Planet” and “Champion our People and
Communities.”
Among key areas of focus in 2024, Baxter:
- Continued its longstanding commitment to disaster relief and
preparedness globally through a combination of product donations
and financial assistance, as well as employees working tirelessly
to help ensure access to Baxter’s medically essential products. In
2024, these efforts included more than $4 million in contributions
focused on relief in the wake of Hurricane Helene in the southern
U.S., which directly affected Baxter’s employees in North Carolina
as well as numerous other communities in the hurricane’s path.
Baxter also activated support in response to other natural
disasters, including the Rio Grande do Sul floods in Brazil;
Hurricane Beryl, affecting parts of the Caribbean, Mexico and the
U.S.; and severe flooding in Valencia, Spain. More recently, the
company activated a response to the massive wildfires affecting
Southern California.
- Advanced a wide range of Signature Partnerships through the
Baxter International Foundation. These multiyear grants with
leading globally recognized nonprofit organizations help fund
access to healthcare for the underserved; bolster science,
technology, engineering and math (STEM) education to develop the
next generation of healthcare innovators; and promote community
resilience, disaster relief, and disaster preparedness. The
Foundation currently maintains ongoing partnerships with the
American Red Cross, Direct Relief and UNICEF, among many others.
The Foundation has invested more than $28 million through its
Signature Partnerships since establishing the program in 2019.
- Maintained its emphasis on sustainable business practices and
environmental stewardship across our value chain. This includes our
ongoing efforts to achieve carbon neutrality, implement strategic
water management plans, advance sustainable procurement and
mitigate waste.
More information about Baxter's corporate responsibility
initiatives is available on the company’s web site, including
Baxter’s most recent Corporate Responsibility report. The company’s
2024 Corporate Responsibility report will be published later this
year.
2025 Financial Outlook
For full-year 2025: Baxter expects
sales growth from continuing operations of 5% to 6% on a reported
basis. On an operational basis,4 Baxter expects sales growth of 4%
to 5%. The company expects adjusted earnings from continuing
operations, before special items, of $2.45 to $2.55 per diluted
share.
For first-quarter 2025: The company
expects sales growth from continuing operations of 3% to 4% on a
reported basis and approximately 4% on an operational basis. The
company expects adjusted earnings from continuing operations,
before special items, of $0.47 to $0.50 per diluted share.
A webcast of Baxter’s fourth-quarter 2024 conference call for
investors can be accessed live from a link in the Investor
Relations section of the company’s website at www.baxter.com
beginning at 7:30 a.m. CST on Feb. 20, 2025. Please see
www.baxter.com for more information regarding this and future
investor events and webcasts.
About Baxter
Every day, millions of patients, caregivers and healthcare
providers rely on Baxter’s leading portfolio of diagnostic,
critical care, nutrition, hospital and surgical products used
across patient homes, hospitals, physician offices and other sites
of care. For more than 90 years, we’ve been operating at the
critical intersection where innovations that save and sustain lives
meet the healthcare providers who make it happen. With products,
digital health solutions and therapies available in more than 100
countries, Baxter’s employees worldwide are now building upon the
company’s rich heritage of medical breakthroughs to advance the
next generation of transformative healthcare innovations. To learn
more, visit www.baxter.com and follow us on X, LinkedIn and
Facebook.
Non-GAAP Financial Measures
Non-GAAP financial measures may enhance an understanding of the
company’s operations and may facilitate an analysis of those
operations, particularly in evaluating performance from one period
to another. Management believes that non-GAAP financial measures,
when used in conjunction with the results presented in accordance
with U.S. GAAP and the company’s reconciliations to corresponding
U.S. GAAP financial measures (which are included in the tables
accompanying this release), may enhance an investor’s overall
understanding of the company’s past financial performance and
prospects for the future. Management uses these non-GAAP measures
internally in financial planning, to monitor business unit
performance, and, in some cases, for purposes of determining
incentive compensation. This information should be considered in
addition to, and not as substitutes for, information prepared in
accordance with U.S. GAAP.
Net sales growth on a constant currency basis is a non-GAAP
financial measure that provides information on the percentage
change in net sales growth as if foreign currency exchange rates
had remained constant between the prior and current periods.
Operational sales growth is a non-GAAP meaure that excludes
the impact of the Kidney Care MSA not reflected in its reportable
segments, reflects the exit of IV solutions in China in its Medical
Products & Therapies reportable segment, and is calculated
on a constant currency basis.
Other non-GAAP financial measures included in this release and
the accompanying tables (including within the tables that provide
the company’s detailed reconciliations to the corresponding U.S.
GAAP financial measures) are: adjusted gross margin, adjusted
selling, general, and administrative expenses, adjusted research
and development expenses, adjusted other operating expense, net,
adjusted operating income, adjusted other income (expense), net,
adjusted income (loss) from continuing operations before income
taxes, adjusted income tax expense (benefit), adjusted income
(loss) from continuing operations, adjusted income (loss) from
discontinued operations, adjusted net income (loss), adjusted net
income (loss) attributable to Baxter stockholders, adjusted diluted
earnings per share from continuing operations, adjusted diluted
earnings per share from discontinued operations and adjusted
diluted earnings per share. Those non-GAAP financial measures
exclude the impact of special items. For the quarter and full year
ended December 31, 2024 and 2023, special items for one or more
periods included intangible asset amortization, business
optimization charges, acquisition and integration costs,
separation-related costs, expenses related to European medical
devices regulation, certain legal matters, goodwill impairments,
long-lived asset impairments, non-marketable investment
impairments, product-related reserves, the gain on the sale of the
BPS business, Hurricane Helene costs, and certain tax matters.
These items are excluded because they are highly variable or
unusual and of a size that may substantially impact the company’s
reported operations for a period. Additionally, intangible asset
amortization is excluded as a special item to facilitate an
evaluation of current and past operating performance and is
consistent with how management and the company’s Board of Directors
assess performance.
This release and the accompanying tables also include free cash
flow, a non-GAAP financial measure that Baxter defines as operating
cash flow less capital expenditures. Free cash flow is used by
management and the company’s Board of Directors to evaluate the
cash generated from Baxter’s operating activities each period after
deducting its capital spending.
This release also includes forecasts of certain of the
aforementioned non-GAAP measures on a forward-looking basis as part
of the company’s financial outlook for upcoming periods. Baxter
calculates forward-looking non-GAAP financial measures based on
forecasts that omit certain amounts that would be included in GAAP
financial measures. For instance, forward-looking operational sales
growth represents the company's targeted future sales growth
excluding sales to Vantive under the Kidney Care MSA not reflected
in its reportable segments, reflects the exit of IV solutions in
China in its Medical Products & Therapies reportable
segment, and assumes foreign currency exchange rates remain
constant in future periods. Additionally, forward-looking adjusted
diluted EPS guidance excludes potential charges or gains that would
be reflected as non-GAAP adjustments to earnings. Baxter provides
forward-looking operational sales growth guidance and adjusted
diluted EPS guidance because it believes that these measures
provide useful information for the reasons noted above. Baxter has
not provided reconciliations of forward-looking adjusted EPS
guidance to forward-looking GAAP EPS guidance because the company
is unable to predict with reasonable certainty the impact of legal
proceedings, future business optimization actions,
separation-related costs, integration-related costs, asset
impairments and unusual gains and losses, and the related amounts
are unavailable without unreasonable efforts (as specified in the
exception provided by Item 10(e)(1)(i)(B) of Regulation S-K). In
addition, Baxter believes that such reconciliations would imply a
degree of precision and certainty that could be confusing to
investors. Such items could have a substantial impact on GAAP
measures of financial performance.
Forward-Looking Statements
This release includes forward-looking statements concerning the
company’s financial results (including the outlook for
first-quarter and full-year 2025) and business development and
regulatory activities. These forward-looking statements are based
on assumptions about many important factors, including the
following, which could cause actual results to differ materially
from those in the forward-looking statements: the company’s ability
to achieve the intended benefits of its recent strategic actions,
including the sale of the Kidney Care business, and cost saving
initiatives; the company’s ability to successfully integrate
acquisitions, including the acquisition of Hill-Rom Holdings, Inc.
and the related impact on the company’s organization structure,
senior leadership, culture, functional alignment, outsourcing and
other areas, the company’s management of resulting related
personnel capacity constraints and potential institutional
knowledge loss, and the company’s ability to achieve anticipated
performance or financial targets and maintain its reputation
following integration; the impact of global economic conditions
(including, among other things, changes in taxation, tariffs, trade
policies and treaties, sanctions, embargos, export control
restrictions, inflation levels and interest rates, financial market
volatility, banking crises, the potential for a recession, the war
in Ukraine, the conflict in the Middle East, other geopolitical
events and the potential for escalation of these conflicts, the
related economic sanctions being imposed globally in response to
the conflicts and potential trade wars, global public health
crises, pandemics and epidemics, or the anticipation of any of the
foregoing, on the company’s operations and on the company’s
employees, customers, suppliers, and foreign governments in
countries in which the company operates; failure to accurately
forecast or achieve the company’s short- and long-term financial
performance and goals, market and category growth rates, and
related impacts on the company’s liquidity; the company’s ability
to execute on its capital allocation plans, including the company’s
debt repayment plans, the timing and amount of any dividends, share
repurchases and divestiture proceeds; downgrades to the company’s
credit ratings or ratings outlooks, or withdrawals by rating
agencies from rating the company and its indebtedness, and the
impact on the company’s funding costs and liquidity; fluctuations
in foreign exchange and interest rates; the impact of any goodwill,
intangible asset, or other long-lived asset impairments on the
company’s operating results; the company’s ability to finance and
develop new products or services, or enhancements thereto, on
commercially acceptable terms or at all; product development risks,
including satisfactory clinical performance and obtaining and
maintaining required regulatory approvals (including as a result of
evolving regulatory requirements or the withdrawal or resubmission
of any pending applications), the ability to manufacture at
appropriate scale, and the general unpredictability associated with
the product development cycle; demand and market acceptance risks
for, and competitive pressures related to, new and existing
products and services, challenges with the company’s ability to
accurately predict changing customer preferences and future
expenditures and inventory levels, and challenges with the
company’s ability to monetize new and existing products and
services (and to sustain any related price increases), the impact
of those products and services on quality and patient safety
concerns, and the need for ongoing training and support for the
company’s products and services; the impact of competitive products
and pricing, including generic competition, drug reimportation, and
disruptive technologies; regulatory agency inspections, product
quality or patient safety issues leading to product recalls,
withdrawals, labeling changes, launch delays, warning letters,
import bans, denial of import certifications, sanctions, seizures,
litigation, or declining sales, including the focus on evaluating
product portfolios for the potential presence or formation of
nitrosamines; future actions of, or failures to act or delays in
acting by FDA, the European Medicines Agency, or any other
regulatory body or government authority (including the U.S.
Securities and Exchange Commission, Department of Justice, or the
Attorney General of any state) that could delay, limit or suspend
product development, manufacturing or sale, or result in seizures,
recalls, injunctions, monetary sanctions or criminal or civil
liabilities; failures with respect to the company’s quality,
compliance or ethics programs; loss of key employees, including
senior management, the occurrence of labor disruptions (including
as a result of labor disagreements under bargaining agreements or
national trade union agreements or disputes with works councils) or
the inability to attract, develop, retain and engage employees;
inability to create additional production capacity in a timely
manner or the occurrence of other manufacturing, sterilization, or
supply difficulties, including as a result of natural disaster
(such as Hurricane Helene), war, terrorism, global public health
crises and epidemics/pandemics, regulatory actions or otherwise;
future actions of third parties, including third-party payors and
the company’s customers and distributors (including GPOs and IDNs);
the continuity, availability, and pricing of acceptable raw
materials and component parts, the company’s ability to pass some
or all of these costs to the company’s customers through price
increases or otherwise, and the related continuity of the company’s
manufacturing and distribution and those of the company’s
suppliers; breaches, including by cyber-attack, data leakage,
unauthorized access or theft, or failures of or vulnerabilities in,
the company’s information technology systems or products; the
company’s ability to effectively develop, integrate or deploy
artificial intelligence, machine learning and other emerging
technologies into the company’s products, services and operations
in a manner that is compliant with existing and emerging
regulations; the impact of physical effects of climate change,
severe storms (including Hurricane Helene) and storm-related
events, including the company’s ability to resume production at its
North Cove facility to pre-hurricane levels and to complete the
remediation; changes to legislation and regulation and other
governmental pressures in the United States and globally, including
the cost of compliance and potential penalties for purported
noncompliance thereof, including new or amended laws, rules and
regulations as well as the impact of healthcare reform and its
implementation, suspension, repeal, replacement, amendment,
modification and other similar actions undertaken by the United
States or foreign governments, including with respect to pricing,
reimbursement, taxation and rebate policies; the company’s ability
to meet evolving and varied corporate responsibility expectations
of the company’s stakeholders, including compliance with new and
emerging sustainability regulations; global regulatory, trade, and
tax policies, including with respect to climate change and other
sustainability matters; the ability to protect or enforce the
company’s patents or other proprietary rights (including
trademarks, copyrights, trade secrets, and know-how) or where the
patents of third parties prevent or restrict the company’s
manufacture, sale or use of affected products or technology; any
changes in law concerning the taxation of income (whether with
respect to current or future tax reform); actions by tax
authorities in connection with ongoing tax audits; the outcome of
pending or future litigation; and other risks discussed in Baxter’s
most recent filings on Form 10-K and Form 10-Q and other SEC
filings, all of which are available on Baxter’s website. Baxter
does not undertake to update its forward-looking statements unless
otherwise required by the federal securities laws.
Baxter, Clinolipid, Dose IQ, IQ Enterprise, Novum IQ and The
Vest are trademarks of Baxter International Inc.
Any other trademarks or product brands appearing herein are the
property of their respective owners.
1 Sales growth at constant currency rates and adjusted diluted
EPS are non-GAAP financial measures. See the “Non-GAAP Financial
Measures” section below for information about the non-GAAP
financial measures included in this release and see the
accompanying tables to this press release for reconciliations of
those non-GAAP measures to the corresponding U.S. GAAP
measures.
2 Generally Accepted Accounting Principles
3 See links to original press releases for additional product
information.
4 Operational sales growth excludes the impact of the Kidney
Care manufacturing and supply agreement (MSA) not reflected in its
reportable segments, reflects the exit of IV solutions in China in
its Medical Products & Therapies reportable segment, and is
calculated at constant currency rates.
BAXTER INTERNATIONAL
INC.
Consolidated Statements of
Income (Loss)
(unaudited)
(in millions, except per share
and percentage data)
Three Months Ended
December 31,
2024
2023
Change
NET SALES
$
2,753
$
2,729
1%
COST OF SALES
1,794
1,629
10%
GROSS MARGIN
959
1,100
(13)%
% of Net Sales
34.8
%
40.3
%
(5.5 pts)
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES
761
683
11%
% of Net Sales
27.6
%
25.0
%
2.6 pts
RESEARCH AND DEVELOPMENT
EXPENSES
211
127
66%
% of Net Sales
7.7
%
4.7
%
3.0 pts
GOODWILL IMPAIRMENTS
425
—
NM
OTHER OPERATING INCOME, NET
(3
)
(14
)
(79)%
OPERATING INCOME (LOSS)
(435
)
304
NM
% of Net Sales
(15.8
)%
11.1
%
(26.9 pts)
INTEREST EXPENSE, NET
90
72
25%
OTHER (INCOME) EXPENSE, NET
(4
)
11
NM
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES
(521
)
221
NM
INCOME TAX EXPENSE (BENEFIT)
(33
)
2
NM
% of Income (Loss) from Continuing
Operations Before Income Taxes
6.3
%
0.9
%
5.4 pts
INCOME (LOSS) FROM CONTINUING
OPERATIONS
(488
)
219
NM
INCOME (LOSS) FROM DISCONTINUED
OPERATIONS, NET OF TAX
(22
)
27
NM
NET INCOME (LOSS)
(510
)
246
NM
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS INCLUDED IN CONTINUING OPERATIONS
—
—
NM
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS INCLUDED IN DISCONTINUED
OPERATIONS
2
1
100%
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
2
1
100%
NET INCOME (LOSS) ATTRIBUTABLE TO
BAXTER STOCKHOLDERS
$
(512
)
$
245
NM
INCOME (LOSS) FROM CONTINUING
OPERATIONS PER COMMON SHARE
Basic
$
(0.95
)
$
0.43
NM
Diluted
$
(0.95
)
$
0.43
NM
INCOME (LOSS) FROM DISCONTINUED
OPERATIONS PER COMMON SHARE
Basic
$
(0.05
)
$
0.05
NM
Diluted
$
(0.05
)
$
0.05
NM
NET INCOME (LOSS) PER COMMON
SHARE
Basic
$
(1.00
)
$
0.48
NM
Diluted
$
(1.00
)
$
0.48
NM
WEIGHTED-AVERAGE NUMBER OF SHARES
OUTSTANDING
Basic
511
507
Diluted
511
509
ADJUSTED OPERATING INCOME (excluding
special items)¹
$
419
$
468
(10)%
ADJUSTED INCOME FROM CONTINUING
OPERATIONS (excluding special items)¹
$
297
$
330
(10)%
ADJUSTED INCOME FROM DISCONTINUED
OPERATIONS (excluding special items)1
$
101
$
105
(4)%
ADJUSTED NET INCOME ATTRIBUTABLE TO
BAXTER STOCKHOLDERS (excluding special items)¹
$
396
$
434
(9)%
ADJUSTED DILUTED EPS FROM CONTINUING
OPERATIONS (excluding special items)¹
$
0.58
$
0.65
(11)%
ADJUSTED DILUTED EPS FROM DISCONTINUED
OPERATIONS (excluding special items)¹
$
0.19
$
0.20
(5)%
ADJUSTED DILUTED EPS (excluding special
items)¹
$
0.77
$
0.85
(9)%
1 Refer to page 14 for a description of
the adjustments and a reconciliation to U.S. GAAP measures.
NM - Not Meaningful
BAXTER INTERNATIONAL
INC.
Description of Adjustments and
Reconciliation of U.S. GAAP to Non-GAAP Measures
(unaudited, in
millions)
The company’s U.S. GAAP results for the
three months ended December 31, 2024 included special items which
impacted the U.S. GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Research and Development
Expenses
Goodwill Impairments
Operating Income (Loss)
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense (Benefit)
Income (Loss) From Continuing
Operations
Income From Discontinued
Operations, Net of Tax
Net Income (Loss)
Net Income
(Loss) Attributable to Baxter
Stockholders
Diluted Earnings Per Share from
Continuing Operations
Diluted Earnings Per Share from
Discontinued Operations
Diluted Earnings Per Share
Reported
$
959
$
761
$
211
$
425
$
(435
)
$
(521
)
$
(33
)
$
(488
)
$
(22
)
$
(510
)
$
(512
)
$
(0.95
)
$
(0.05
)
$
(1.00
)
Reported percent of net sales (or
effective tax rate for income tax expense (benefit))
34.8
%
27.6
%
7.7
%
15.4
%
(15.8
)%
(18.9
)%
6.3
%
(17.7
)%
(0.8
)%
(18.5
)%
(18.6
)%
Intangible asset amortization
103
(51
)
—
—
154
154
37
117
1
118
118
0.23
0.00
0.23
Business optimization items1
59
(24
)
(30
)
—
113
113
27
86
(4
)
82
82
0.17
(0.01
)
0.16
Acquisition and integration items2
—
(7
)
—
—
7
7
2
5
—
5
5
0.01
0.00
0.01
European medical devices regulation3
8
—
—
—
8
8
1
7
(1
)
6
6
0.01
0.00
0.01
Product-related items4
12
—
—
—
12
12
3
9
—
9
9
0.02
0.00
0.02
Hurricane Helene costs5
85
—
—
—
85
85
21
64
9
73
73
0.13
0.01
0.14
Long-lived asset impairments6
—
—
(50
)
—
50
50
13
37
—
37
37
0.07
0.00
0.07
Goodwill impairments7
—
—
—
(425
)
425
425
—
425
—
425
425
0.83
0.00
0.83
Separation-related costs8
—
—
—
—
—
—
—
—
68
68
68
0.00
0.13
0.13
Tax matters12
—
—
—
—
—
—
(35
)
35
50
85
85
0.07
0.10
0.17
Adjusted
$
1,226
$
679
$
131
$
—
$
419
$
333
$
36
$
297
$
101
$
398
$
396
$
0.58
$
0.19
$
0.77
Adjusted percent of net sales (or
effective tax rate for income tax expense (benefit))
44.5
%
24.7
%
4.8
%
0.0
%
15.2
%
12.1
%
10.8
%
10.8
%
3.7
%
14.5
%
14.4
%
Reported
Adjusted
Income (loss) from discontinued
operations, net of tax
$
(22
)
$
101
Weighted-average diluted shares as
reported
511
Less: Net income attributable to
noncontrolling interests included in discontinued operations
2
2
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
1
Income (loss) from discontinued operations
attributable to Baxter stockholders
$
(24
)
$
99
Weighted-average diluted shares as
adjusted
512
Reported
Adjusted
Net income (loss)
$
(510
)
$
398
Less: Net income (loss) attributable to
noncontrolling interests
2
2
Net income (loss) attributable to Baxter
stockholders
$
(512
)
$
396
The company’s U.S. GAAP results for the
three months ended December 31, 2023 included special items which
impacted the U.S. GAAP measures as follows:
Gross Margin
Selling,
General and Administrative
Expenses
Other Operating Expense, Net
Operating Income (Loss)
Other (Income) Expense,
net
Income (Loss) From
Continuing Operations Before
Income Taxes
Income
Tax Expense (Benefit)
Income (Loss)
From Continuing Operations
Income From Discontinued
Operations
Net Income (Loss)
Net Income (Loss)
Attributable
to Baxter Stockholders
Diluted Earnings Per Share from
Continuing Operations
Diluted
Earnings Per
Share from Discontinued
Operations
Diluted Earnings Per Share
Reported
$
1,100
$
683
$
(14
)
$
304
$
11
$
221
$
2
$
219
$
27
$
246
$
245
$
0.43
$
0.05
$
0.48
Reported percent of net sales (or
effective tax rate for income tax expense (benefit))
40.3
%
25.0
%
(0.5
)%
11.1
%
0.4
%
8.1
%
0.9
%
8.0
%
1.0
%
9.0
%
9.0
%
Intangible asset amortization
104
(52
)
—
156
—
156
44
112
12
124
124
0.22
0.02
0.24
Business optimization items1
4
(3
)
—
7
—
7
31
(24
)
14
(10
)
(10
)
(0.05
)
0.03
(0.02
)
Acquisition and integration items2
—
(3
)
5
(2
)
—
(2
)
—
(2
)
—
(2
)
(2
)
0.00
0.00
0.00
European medical devices regulation3
9
—
—
9
—
9
1
8
1
9
9
0.02
0.00
0.02
Legal matters9
—
(2
)
8
(6
)
—
(6
)
(1
)
(5
)
—
(5
)
(5
)
(0.01
)
0.00
(0.01
)
Long-lived asset impairments6
—
—
—
—
—
—
4
(4
)
—
(4
)
(4
)
(0.01
)
0.00
(0.01
)
Investment impairments10
—
—
—
—
(21
)
21
(7
)
28
6
34
34
0.06
0.01
0.07
Gain on BPS Sale11
—
—
—
—
—
—
—
15
15
15
0.00
0.03
0.03
Separation-related costs8
—
—
—
—
—
—
—
—
71
71
71
0.00
0.14
0.14
Tax matters12
—
—
—
—
—
—
2
(2
)
(41
)
(43
)
(43
)
0.00
(0.08
)
(0.08
)
Adjusted
$
1,217
$
623
$
(1
)
$
468
$
(10
)
$
406
$
76
$
330
$
105
$
435
$
434
$
0.65
$
0.20
$
0.85
Adjusted percent of net sales (or
effective tax rate for income tax expense)
44.6
%
22.8
%
0.0
%
17.1
%
(0.4
)%
14.9
%
18.7
%
12.1
%
3.8
%
15.9
%
15.9
%
Reported
Adjusted
Income (loss) from discontinued
operations
$
27
$
105
Less: Net income attributable to
noncontrolling interests included in discontinued operations
1
1
Income (loss) from discontinued operations
attributable to Baxter stockholders
$
26
$
104
Reported
Adjusted
Net income (loss)
$
246
$
435
Less: Net income (loss) attributable to
noncontrolling interests
1
1
Net income (loss) attributable to Baxter
stockholders
$
245
$
434
- The company’s results in 2024 and 2023 included charges
associated with its execution of programs to optimize its
organization and cost structure. The company's results of
continuing operations in 2024 included costs primarily related
initiatives to reduce its cost structure following the sale of its
Kidney Care segment, initiatives within our Healthcare Systems
& Technologies segment including the discontinuing of a product
line and rationalization of certain other manufacturing and
distribution facilities. The company's results of continuing
operations in 2023 included actions related to its current
implementation of a new operating model intended to simplify and
streamline its operations and better align its manufacturing and
supply chain to its commercial activities. The company's results of
discontinued operations in 2023, included actions related to its
decision to close one of its U.S.-based manufacturing
facilities.
- The company’s results in 2024 and 2023 included acquisition and
integration-related items comprised of Hillrom integration expenses
and in 2023, net gains from changes in the fair value of contingent
consideration liabilities.
- The company’s results in 2024 and 2023 included incremental
costs to comply with the European Union’s medical device
regulations for previously registered products, which primarily
consisted of contractor costs and other direct third-party costs.
The company considers the adoption of these regulations to be a
significant one-time regulatory change and believes that the costs
of initial compliance for previously registered products over the
implementation period are not indicative of its core operating
results.
- The company's results of continuing operations in 2024 included
charges related to warranty and remediation activities arising from
field corrective actions on Healthcare Systems & Technologies
products.
- The company's results of continuing operations in 2024 included
net charges related to Hurricane Helene, which consisted of charges
related to remediation, idle facility, air freight and other costs,
partially offset by insurance recoveries. The company's results of
discontinued operations in 2024 included charges related to
Hurricane Helene consisting of charges related to air freight and
other costs.
- The company's results of continuing operations in 2024 included
a long-lived asset impairment charge to reduce the carrying amount
of an in-process research and development (IPR&D) asset to its
fair value.
- The company's results of continuing operations in 2024 included
a goodwill impairment charge related to the Front Line Care
reporting unit within its Healthcare Systems & Technologies
segment.
- The company's results of discontinued operations in 2024 and
2023 included separation-related costs primarily related to
external advisors supporting its activities to prepare for the sale
of its Kidney Care segment.
- The company's results of continuing operations in 2023 included
proceeds received, net of legal fees, from a settlement related to
an intellectual property dispute.
- The company's results of operations in 2023 included
impairments of non-marketable investments in several early-stage
companies consisting of noncash impairment write-downs.
- The company's results of discontinued operations in 2023
included adjustments to its third quarter 2023 gain from the sale
of its BPS business related to final working capital and
transaction cost amounts.
- The company’s results of continuing operations in 2024 included
income tax expense related to legislative changes under IRC Section
987 in the U.S. and net income tax expense related to a revaluation
of the Swiss basis step-up deferred tax asset and related valuation
allowance that arose from Swiss tax reform legislation in 2019 that
was partially offset by a decrease in such valuation allowance to
reflect the company’s current estimate of recoverability of the
basis step-up deferred tax asset. The company's results of
discontinued operations in 2024 included income tax costs on
internal reorganizations related to the sale of its Kidney Care
segment. The company’s results in 2023 included a valuation
allowance decrease related to its estimated recoverability of a
deferred tax asset for the net asset step-up related to Swiss tax
reform legislation enacted during 2019 that is amortizable as a tax
deduction ratably over tax years 2025 through 2029 recorded to
continuing operations, an income tax benefit from an internal
reorganization transaction related to the separation of its Kidney
Care segment recorded to discontinued operations, and a
reallocation of income tax expense between discontinued operations
and continuing operations resulting from the application of
intraperiod tax allocation to its adjusted results in an interim
period.
For more information on the company's use of non-GAAP financial
measures, please see the Non-GAAP Financial Measures section of
this press release.
BAXTER INTERNATIONAL
INC.
Consolidated Statements of
Income (Loss)
(unaudited)
(in millions, except per share
and percentage data)
Twelve Months Ended December
31,
2024
2023
Change
NET SALES
$
10,636
$
10,360
3%
COST OF SALES
6,652
6,210
7%
GROSS MARGIN
3,984
4,150
(4)%
% of Net Sales
37.5
%
40.1
%
(2.6 pts)
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES
2,967
2,953
NM
% of Net Sales
27.9
%
28.5
%
(0.6 pts)
RESEARCH AND DEVELOPMENT
EXPENSES
590
518
14%
% of Net Sales
5.5
%
5.0
%
0.5 pts
GOODWILL IMPAIRMENTS
425
—
NM
OTHER OPERATING INCOME, NET
(12
)
(28
)
(57)%
OPERATING INCOME
14
707
(98)%
% of Net Sales
0.1
%
6.8
%
(6.7 pts)
INTEREST EXPENSE, NET
341
439
(22)%
OTHER (INCOME) EXPENSE, NET
(38
)
26
NM
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES
(289
)
242
NM
INCOME TAX EXPENSE
37
61
(39)%
% of Income (Loss) from Continuing
Operations Before Income Taxes
(12.8
)%
25.2
%
(38.0pts)
INCOME (LOSS) FROM CONTINUING
OPERATIONS
(326
)
181
NM
INCOME (LOSS) FROM DISCONTINUED
OPERATIONS, NET OF TAX
(312
)
2,482
NM
NET INCOME (LOSS)
(638
)
2,663
NM
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS INCLUDED IN CONTINUING OPERATIONS
—
—
NM
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS INCLUDED IN DISCONTINUED
OPERATIONS
11
7
57%
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
11
7
57%
NET INCOME (LOSS) ATTRIBUTABLE TO
BAXTER STOCKHOLDERS
$
(649
)
$
2,656
NM
INCOME (LOSS) FROM CONTINUING
OPERATIONS PER COMMON SHARE
Basic
$
(0.64
)
$
0.36
NM
Diluted
$
(0.64
)
$
0.36
NM
INCOME (LOSS) FROM DISCONTINUED
OPERATIONS PER COMMON SHARE
Basic
$
(0.63
)
$
4.89
NM
Diluted
$
(0.63
)
$
4.87
NM
NET INCOME (LOSS) PER COMMON
SHARE
Basic
$
(1.27
)
$
5.25
NM
Diluted
$
(1.27
)
$
5.23
NM
WEIGHTED-AVERAGE NUMBER OF SHARES
OUTSTANDING
Basic
510
506
Diluted
510
508
ADJUSTED OPERATING INCOME (excluding
special items)¹
$
1,474
$
1,519
(3)%
ADJUSTED INCOME (LOSS) FROM CONTINUING
OPERATIONS (excluding special items)¹
$
966
$
863
12%
ADJUSTED INCOME FROM DISCONTINUED
OPERATIONS (excluding special items)1
$
528
$
625
(16)%
ADJUSTED NET INCOME ATTRIBUTABLE TO
BAXTER STOCKHOLDERS (excluding special items)¹
$
1,483
$
1,481
NM
ADJUSTED DILUTED EPS FROM CONTINUING
OPERATIONS (excluding special items)1
$
1.89
$
1.70
11%
ADJUSTED DILUTED EPS FROM DISCONTINUED
OPERATIONS (excluding special items)1
$
1.01
$
1.22
(17)%
ADJUSTED DILUTED EPS (excluding special
items)¹
$
2.90
$
2.92
(1)%
1 Refer to page 16 for a description of
the adjustments and a reconciliation to U.S. GAAP measures.
NM - Not Meaningful
BAXTER INTERNATIONAL
INC.
Description of Adjustments and
Reconciliation of U.S. GAAP to Non-GAAP Measures
(unaudited, in
millions)
The company’s U.S. GAAP results for the
twelve months ended December 31, 2024 included special items which
impacted the U.S. GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Research and Development
Expenses
Goodwill Impairments
Operating Income (Loss)
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense
Income (Loss) From Continuing
Operations
Income From Discontinued
Operations, Net of Tax
Net Income (Loss)
Net Income (Loss) Attributable to
Baxter Stockholders
Diluted Earnings Per Share From
Continuing Operations
Diluted Earnings Per Share from
Discontinued Operations
Diluted Earnings Per Share
Reported
$
3,984
$
2,967
$
590
$
425
$
14
$
(289
)
$
37
$
(326
)
$
(312
)
$
(638
)
$
(649
)
$
(0.64
)
$
(0.63
)
$
(1.27
)
Reported percent of net sales (or
effective tax rate for income tax expense)
37.5
%
27.9
%
5.5
%
4.0
%
0.1
%
(2.7
)%
(12.8
)%
(3.1
)%
(2.9
)%
(6.0
)%
(6.1
)%
Intangible asset amortization
419
(206
)
—
—
625
625
148
477
20
497
497
0.93
0.04
0.97
Business optimization items1
67
(65
)
(30
)
—
162
162
41
121
49
170
170
0.24
0.09
0.33
Acquisition and integration items2
1
(22
)
—
—
23
23
5
18
—
18
18
0.04
0.00
0.04
European medical devices regulation3
33
—
—
—
33
33
7
26
2
28
28
0.05
0.00
0.05
Product-related items4
15
—
—
—
15
15
3
12
—
12
12
0.02
0.00
0.02
Hurricane Helene costs5
110
—
—
—
110
110
27
83
9
92
92
0.16
0.02
0.18
Long-lived asset impairments6
—
—
(50
)
—
50
50
13
37
—
37
37
0.07
0.00
0.07
Legal matters9
—
(17
)
—
—
17
17
4
13
—
13
13
0.03
0.00
0.03
Goodwill impairments7
—
—
—
(425
)
425
425
—
425
430
855
855
0.83
0.84
1.67
Separation-related costs8
—
—
—
—
—
—
—
—
261
261
261
0.00
0.51
0.51
Tax matters15
—
—
—
—
—
—
(80
)
80
69
149
149
0.16
0.14
0.29
Adjusted
$
4,629
$
2,657
$
510
$
—
$
1,474
$
1,171
$
205
$
966
$
528
$
1,494
$
1,483
$
1.89
$
1.01
$
2.90
Adjusted percent of net sales (or
effective tax rate for income tax expense)
43.5
%
25.0
%
4.8
%
0.0
%
13.9
%
11.0
%
17.5
%
9.1
%
5.0
%
14.0
%
13.9
%
Reported
Adjusted
Income (loss) from discontinued
operations, net of tax
$
(312
)
$
528
Weighted-average diluted shares as
reported
510
Less: Net income attributable to
noncontrolling interests included in discontinued operations
11
11
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
1
Income (loss) from discontinued operations
attributable to Baxter stockholders
$
(323
)
$
517
Weighted-average diluted shares as
adjusted
511
Reported
Adjusted
Net income (loss)
$
(638
)
$
1,494
Less: Net income (loss) attributable to
noncontrolling interests
11
11
Net income (loss) attributable to Baxter
stockholders
$
(649
)
$
1,483
The company’s U.S. GAAP results for the twelve months ended
December 31, 2023 included special items which impacted the U.S.
GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Research and Development
Expenses
Other Operating Expense, Net
Operating Income (Loss)
Other (Income) Expense, Net
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense (Benefit)
Income (Loss) From Continuing
Operations
Income From Discontinued
Operations, Net of Tax
Net Income (Loss)
Net Income (Loss) Attributable to
Baxter Stockholders
Diluted Earnings Per Share From
Continuing Operations
Diluted Earnings Per Share From
Discontinued Operations
Diluted Earnings Per Share
Reported
$
4,150
$
2,953
$
518
$
(28
)
$
707
$
26
$
242
$
61
$
181
$
2,482
$
2,663
$
2,656
$
0.36
$
4.87
$
5.23
Reported percent of net sales (or
effective tax rate for income tax expense (benefit))
40.1
%
28.5
%
5.0
%
(0.3
)%
6.8
%
0.3
%
2.3
%
25.2
%
1.7
%
24.0
%
25.7
%
25.6
%
Intangible asset amortization
383
(207
)
—
—
590
—
590
143
447
49
496
496
0.88
0.10
0.98
Business optimization items1
27
(137
)
(10
)
—
174
—
174
69
105
305
410
410
0.21
0.59
0.80
Acquisition and integration items2
1
(18
)
—
19
—
—
—
1
(1
)
—
(1
)
(1
)
0.00
0.00
0.00
European medical devices regulation3
41
—
—
—
41
—
41
11
30
6
36
36
0.06
0.01
0.07
Long-lived asset impairments6
—
—
—
—
—
—
—
4
(4
)
205
201
201
(0.01
)
0.41
0.40
Legal matters9
—
(15
)
—
8
7
—
7
2
5
—
5
5
0.01
0.00
0.01
Investment impairments10
—
—
—
—
—
(31
)
31
(4
)
35
14
49
49
0.07
0.03
0.10
Gain on BPS Sale11
—
—
—
—
—
—
—
—
—
(2,588
)
(2,588
)
(2,588
)
0.00
(5.09
)
(5.09
)
Separation-related costs8
—
—
—
—
—
—
—
—
—
213
213
213
0.00
0.42
0.42
Tax matters12
—
—
—
—
—
—
—
(65
)
65
(61
)
4
4
0.13
(0.12
)
0.01
Adjusted
$
4,602
$
2,576
$
508
$
(1
)
$
1,519
$
(5
)
$
1,085
$
222
$
863
$
625
$
1,488
$
1,481
$
1.70
$
1.22
$
2.92
Adjusted percent of net sales (or
effective tax rate for income tax expense)
44.4
%
24.9
%
4.9
%
0.0
%
14.7
%
0.0
%
10.5
%
20.5
%
8.3
%
6.0
%
14.4
%
14.3
%
Reported
Adjusted
Income (loss) from discontinued
operations, net of tax
$
2,482
$
625
Weighted-average diluted shares as
reported
506
Less: Net income attributable to
noncontrolling interests included in discontinued operations
7
7
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
2
Income (loss) from discontinued operations
attributable to Baxter stockholders
$
2,475
$
618
Weighted-average diluted shares as
adjusted
508
Reported
Adjusted
Weighted-average diluted shares as
reported
$
2,663
$
1,488
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
7
7
Weighted-average diluted shares as
adjusted
$
2,656
$
1,481
- The company’s results in 2024 and 2023 included charges
associated with its execution of programs to optimize its
organization and cost structure. The company's results of
continuing operations in 2024 included costs primarily related
initiatives to reduce its cost structure following the sale of its
Kidney Care segment, initiatives within our Healthcare Systems
& Technologies segment including the discontinuing of a product
line and rationalization of certain other manufacturing and
distribution facilities. The company's results of continuing
operations in 2023 included actions related to its current
implementation of a new operating model intended to simplify and
streamline its operations and better align its manufacturing and
supply chain to its commercial activities. The company's results of
discontinued operations in 2023, included actions related to its
decision to close one of its U.S.-based manufacturing facilities,
which resulted in a noncash impairment of property, plant and
equipment in the first half of the year.
- The company’s results of continuing operations in 2024 included
acquisition and integration-related items comprised of Hillrom
acquisition and integration expenses.
- The company’s results in 2024 and 2023 included incremental
costs to comply with the European Union’s medical device
regulations for previously registered products, which primarily
consist of contractor costs and other direct third-party costs. The
company considers the adoption of these regulations to be a
significant one-time regulatory change and believes that the costs
of initial compliance for previously registered products over the
implementation period are not indicative of its core operating
results.
- The company's results of continuing operations in 2024 included
charges related to warranty and remediation activities arising from
field corrective actions on Healthcare Systems & Technologies
products and a revised estimate of warranty and remediation
activities arising from a field correction action on certain of its
infusion pumps initially recorded in 2022.
- The company's results of continuing operations in 2024 included
net charges related to Hurricane Helene, which consisted of charges
related to damaged inventory and fixed assets, remediation, idle
facility, air freight and other costs, partially offset by
insurance recoveries. The company's results of discontinued
operations in 2024 included charges related to Hurricane Helene
consisting of charges related to air freight and other costs.
- The company's results of continuing operations in 2024 included
a long-lived asset impairment charge to reduce the carrying amount
of an IPR&D asset to its fair value. The company's results of
discontinued operations in 2023 included long-lived asset
impairment charges related to the Hemodialysis business within its
Kidney Care segment.
- The company's results of continuing operations in 2024 included
a goodwill impairment charge related to the Front Line Care
reporting unit within its Healthcare Systems & Technologies
segment. The company's results of discontinued operations in 2023
included a goodwill impairment charge related to the Chronic
Therapies reporting unit within its Kidney Care segment.
- The company's results of discontinued operations in 2024 and
2023 included separation-related costs primarily related to
external advisors supporting its activities to prepare for the sale
of its Kidney Care segment. The company's results in 2023 also
included separation-related costs related to the sale of its
BioPharma Solutions (BPS) business.
- The company's results of continuing operations in 2024 included
charges related to environmental reserves for remediation actions
associated with historic operations at certain of our facilities.
The company's results of continuing operations in 2023 included
costs, including associated legal fees, related to matters
involving alleged violations of the False Claims Act related to a
now discontinued legacy Hillrom sales line and alleged injury from
environmental exposure, partially offset by proceeds received, net
of legal fees, from a settlement related to an intellectual
property dispute.
- The company's results of operations in 2023 included
impairments of non-marketable investments in several early-stage
companies consisting of noncash impairment write-downs.
- The company's results of discontinued operations in 2023
included adjustments to its third quarter 2023 gain from the sale
of its BPS business.
- The company’s results of continuing operations in 2024 included
income tax expense consisting of a valuation allowance recorded to
reduce the carrying amount of a tax attribute carryforward in the
U.S., net income tax costs on internal reorganizations related to
the sale of our Kidney Care segment, legislative changes under IRC
Section 987 in the U.S., and a revaluation of the Swiss basis
step-up deferred tax asset and related valuation allowance that
arose from Swiss tax reform legislation in 2019 that was partially
offset by a decrease in such valuation allowance to reflect the
company’s current estimate of recoverability of the basis step-up
deferred tax asset. The company's results of discontinued
operations in 2024 included income tax costs on internal
reorganizations related to the sale of its Kidney Care segment,
partially offset by an income tax benefit related to the
deductibility of certain separation costs in the U.S. The company's
results in 2023 included a net income tax expense from separation
related income tax costs associated with the sale of its BPS
business and a valuation allowance increase related to its
estimated recoverability of a deferred tax asset for a net asset
step-up related to Swiss tax reform legislation enacted during 2019
that is amortizable as a tax deduction ratably over tax years 2025
through 2029, with the remaining tax expense related to the tax
effects of other special items recorded to continuing operations.
The company's results of discontinued operations in 2023 included
an income tax benefit from an internal reorganization transaction
related to the separation of its Kidney Care segment, with the
remaining tax benefit related to the tax effects of other special
items.
For more information on the company's use of non-GAAP financial
measures, please see the Non-GAAP Financial Measures section of
this press release.
BAXTER INTERNATIONAL
INC.
Sales by Operating
Segment
(unaudited)
($ in millions)
The Medical Products & Therapies
segment includes sales of our sterile IV solutions, infusion
systems, administration sets, parenteral nutrition therapies and
surgical hemostat, sealant and adhesion prevention products. The
Healthcare Systems & Technologies segment includes sales of our
connected care solutions and collaboration tools, including smart
bed systems, patient monitoring systems and diagnostic
technologies, respiratory health devices and advanced equipment for
the surgical space, including operating room integration
technologies, precision positioning devices and other accessories.
The Pharmaceuticals segment includes sales of specialty injectable
pharmaceuticals, inhaled anesthesia and drug compounding. Other
sales not allocated to a segment primarily include sales of
products and services provided directly through certain of our
manufacturing facilities.
Three Months Ended
December 31,
Twelve Months
Ended December 31,
2024
2023
% Growth
@ Actual
Rates
% Growth
@ Constant
Rates
2024
2023
% Growth
@ Actual
Rates
% Growth
@ Constant
Rates
Infusion Therapies & Technologies
$ 1,022
$ 1,042
(2) %
(1) %
$ 4,103
$ 3,960
4 %
4 %
Advanced Surgery
292
278
5 %
6 %
1,104
1,051
5 %
6 %
Medical Products & Therapies
1,314
1,320
(0) %
1 %
5,207
5,011
4 %
5 %
Care and Connectivity Solutions
504
492
2 %
3 %
1,814
1,800
1 %
1 %
Front Line Care
280
303
(8) %
(8) %
1,137
1,213
(6) %
(6) %
Healthcare Systems & Technologies
784
795
(1) %
(1) %
2,951
3,013
(2) %
(2) %
Injectables and Anesthesia
383
359
7 %
8 %
1,373
1,347
2 %
3 %
Drug Compounding
260
237
10 %
9 %
1,038
902
15 %
15 %
Pharmaceuticals
643
596
8 %
8 %
2,411
2,249
7 %
7 %
Other
12
18
(33) %
(33) %
67
87
(23) %
(22) %
Total - Continuing Operations
$ 2,753
$ 2,729
1 %
2 %
$ 10,636
$ 10,360
3 %
3 %
Constant currency growth is a non-GAAP measure. For more
information on the company’s use of non-GAAP financial measures,
please see the Non-GAAP Financial Measures section of this press
release.
BAXTER INTERNATIONAL
INC.
Segment Operating
Income
(unaudited)
($ in millions)
Three months ended December
31,
Twelve months ended December
31,
(in millions)
2024
2023
2024
2023
Medical Products & Therapies
$ 217
$ 266
$ 950
$ 972
% of Segment Net Sales
16.5 %
20.2 %
18.2 %
19.4 %
Healthcare Systems & Technologies
145
156
468
483
% of Segment Net Sales
18.5 %
19.6 %
15.9 %
16.0 %
Pharmaceuticals
102
117
313
401
% of Segment Net Sales
15.9 %
19.6 %
13.0 %
17.8 %
Other
3
(1)
18
18
Total
467
538
1,749
1,874
Unallocated corporate costs
(48)
(70)
(275)
(355)
Intangible asset amortization expense
(154)
(156)
(625)
(590)
Business optimization items
(113)
(7)
(162)
(174)
European medical devices regulation
(8)
(9)
(33)
(41)
Long-lived asset impairments
(50)
—
(50)
—
Legal matters
—
6
(17)
(7)
Acquisition and integration items
(7)
2
(23)
—
Product-related items
(12)
—
(15)
—
Hurricane Helene costs
(85)
—
(110)
—
Goodwill impairments
(425)
—
(425)
—
Total operating income (loss)
(435)
304
14
707
Interest expense, net
90
72
341
439
Other (income) expense, net
(4)
11
(38)
26
Income (loss) from continuing operations before income taxes
$ (521)
$ 221
$ (289)
$ 242
BAXTER INTERNATIONAL
INC.
Operating Segment Sales by
U.S. and International
(unaudited)
($ in millions)
Three Months Ended December
31,
2024
2023
% Growth
U.S.
International
Total
U.S.
International
Total
U.S.
International
Total
Infusion Therapies & Technologies
$ 561
$ 461
$ 1,022
$ 573
$ 469
$ 1,042
(2) %
(2) %
(2) %
Advanced Surgery
157
135
292
149
129
278
5 %
5 %
5 %
Medical Products & Therapies
718
596
1,314
722
598
1,320
(1) %
(0) %
(0) %
Care and Connectivity Solutions
366
138
504
337
155
492
9 %
(11) %
2 %
Front Line Care
208
72
280
223
80
303
(7) %
(10) %
(8) %
Healthcare Systems & Technologies
574
210
784
560
235
795
3 %
(11) %
(1) %
Injectables and Anesthesia
214
169
383
209
150
359
2 %
13 %
7 %
Drug Compounding
—
260
260
—
237
237
0 %
10 %
10 %
Pharmaceuticals
214
429
643
209
387
596
2 %
11 %
8 %
Other
4
8
12
14
4
18
(71) %
100 %
(33) %
Total - Continuing Operations
$ 1,510
$ 1,243
$ 2,753
$ 1,505
$ 1,224
$ 2,729
0 %
2 %
1 %
BAXTER INTERNATIONAL
INC.
Operating Segment Sales by
U.S. and International
(unaudited)
($ in millions)
Twelve Months Ended December
31,
2024
2023
% Growth
U.S.
International
Total
U.S.
International
Total
U.S.
International
Total
Infusion Therapies & Technologies
$ 2,279
$ 1,824
$ 4,103
$ 2,227
$ 1,733
$ 3,960
2 %
5 %
4 %
Advanced Surgery
603
501
1,104
582
469
1,051
4 %
7 %
5 %
Medical Products & Therapies
2,882
2,325
5,207
2,809
2,202
5,011
3 %
6 %
4 %
Care and Connectivity Solutions
1,311
503
1,814
1,263
537
1,800
4 %
(6) %
1 %
Front Line Care
843
294
1,137
905
308
1,213
(7) %
(5) %
(6) %
Healthcare Systems & Technologies
2,154
797
2,951
2,168
845
3,013
(1) %
(6) %
(2) %
Injectables and Anesthesia
780
593
1,373
759
588
1,347
3 %
1 %
2 %
Drug Compounding
—
1,038
1,038
—
902
902
0 %
15 %
15 %
Pharmaceuticals
780
1,631
2,411
759
1,490
2,249
3 %
9 %
7 %
Other
34
33
67
66
21
87
(48) %
57 %
(23) %
Total - Continuing Operations
$ 5,850
$ 4,786
$ 10,636
$ 5,802
$ 4,558
$ 10,360
1 %
5 %
3 %
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measure
Operating Cash Flow to Free
Cash Flow
(unaudited)
($ in millions)
Twelve Months Ended December
31,
2024
2023
Cash flows from operations – continuing
operations
$
819
$
1,207
Cash flows from investing activities -
continuing operations
(410
)
(410
)
Cash flows from financing activities
(1,081
)
(3,489
)
Cash flows from operations - continuing
operations
$
819
$
1,207
Capital expenditures - continuing
operations
(446
)
(432
)
Free cash flow - continuing
operations
$
373
$
775
Free cash flow is a non-GAAP measure. For more information on
the company’s use of non-GAAP financial measures, please see the
Non-GAAP Financial Measures section of this press release.
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measure
Change in Net Sales Growth As
Reported to Constant Currency Sales Growth
From The Three Months Ended
December 31, 2023 to The Three Months Ended December 31,
2024
(unaudited)
Net Sales
Growth
As Reported
FX
Constant
Currency Sales Growth*
Infusion Therapies & Technologies
(2
)%
1
%
(1
)%
Advanced Surgery
5
%
1
%
6
%
Medical Products &
Therapies
(0
)%
1
%
1
%
Care and Connectivity Solutions
2
%
1
%
3
%
Front Line Care
(8
)%
0
%
(8
)%
Healthcare Systems &
Technologies
(1
)%
0
%
(1
)%
Injectables and Anesthesia
7
%
1
%
8
%
Drug Compounding
10
%
(1
)%
9
%
Pharmaceuticals
8
%
0
%
8
%
Other
(33
)%
0
%
(33
)%
Total - Continuing Operations
1
%
1
%
2
%
Discontinued Operations - Kidney Care
(2
)%
3
%
1
%
*Totals may not add across due to rounding
Constant currency sales growth is a non-GAAP measure. For more
information on the company’s use of non-GAAP financial measures,
please see the Non-GAAP Financial Measures section of this press
release.
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measure
Change in Net Sales Growth As
Reported to Constant Currency Sales Growth
From The Twelve Months Ended
December 31, 2023 to The Twelve Months Ended December 31,
2024
(unaudited)
Net Sales Growth
As Reported
FX
Constant Currency Sales
Growth*
Infusion Therapies & Technologies
4
%
0
%
4
%
Advanced Surgery
5
%
1
%
6
%
Medical Products &
Therapies
4
%
1
%
5
%
Care and Connectivity Solutions
1
%
0
%
1
%
Front Line Care
(6
)%
0
%
(6
)%
Healthcare Systems &
Technologies
(2
)%
0
%
(2
)%
Injectables and Anesthesia
2
%
1
%
3
%
Drug Compounding
15
%
0
%
15
%
Pharmaceuticals
7
%
0
%
7
%
Other
(23
)%
1
%
(22
)%
Total - Continuing Operations
3
%
0
%
3
%
*Totals may not add across due to rounding
Constant currency sales growth is a non-GAAP measure. For more
information on the company’s use of non-GAAP financial measures,
please see the Non-GAAP Financial Measures section of this press
release.
BAXTER INTERNATIONAL
INC.
Projected First Quarter and
Full Year 2025 U.S. GAAP Sales Growth to Projected Operational
Sales Growth and Projected First Quarter and Full Year 2025
Adjusted Earnings Per Share
(unaudited)
Sales Growth Guidance
Q1 2025*
FY 2025*
Sales growth - U.S. GAAP
3% - 4%
5% - 6%
Kidney Care MSA
(~ 250 bps)
(~ 350 bps)
Exit of IV Solutions in China
~ 60 bps
~ 60 bps
Foreign Exchange
> 200 bps
~ 200 bps
Operational sales growth
~ 4%
4% - 5%
Adjusted Earnings Per Share
Guidance
Q1 2025
FY 2025
Adjusted diluted EPS
$0.47 - $0.50
$2.45 - $2.55
*Totals may not foot due to rounding
Baxter calculates forward-looking non-GAAP financial measures
based on forecasts that omit certain amounts that would be included
in GAAP financial measures. For instance, forward-looking
operational sales growth represents the company’s targeted future
sales growth excluding sales to Vantive under the Kidney Care
manufacturing and supply agreement (MSA) not reflected in its
reportable segments, reflects the exit of IV Solutions in China in
its Medical Products & Therapies reportable segment, and
assumes foreign currency exchange rates remain constant in future
periods. Additionally, forward-looking adjusted diluted EPS
guidance excludes potential charges or gains that would be
reflected as non-GAAP adjustments to earnings. Baxter provides
forward-looking operational sales growth guidance and adjusted
diluted EPS guidance because it believes that these measures
provide useful information for the reasons noted above. Baxter has
not provided reconciliations of forward-looking adjusted EPS
guidance to forward-looking GAAP EPS guidance because the company
is unable to predict with reasonable certainty the impact of legal
proceedings, future business optimization actions,
separation-related costs, integration-related costs, asset
impairments and unusual gains and losses, and the related amounts
are unavailable without unreasonable efforts (as specified in the
exception provided by Item 10(e)(1)(i)(B) of Regulation S-K). In
addition, Baxter believes that such reconciliations would imply a
degree of precision and certainty that could be confusing to
investors. Such items could have a substantial impact on GAAP
measures of financial performance.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250218172755/en/
Media Contact Stacey Eisen, (224) 948-5353 media@baxter.com
Investor Contact Clare Trachtman, (224) 948-3020
Baxter (NYSE:BAX)
Historical Stock Chart
From Jan 2025 to Feb 2025
Baxter (NYSE:BAX)
Historical Stock Chart
From Feb 2024 to Feb 2025
