BECTON DICKINSON & CO

Previous wording

We have been experiencing, and may continue to experience, some adverse impact to our results of operations due to market dynamics in China, such as volume-based procurement programs (“VoBP”) and the government’s focus to improve compliance of healthcare practitioners. Also, reductions or delays in governmental research funding and/or higher interest rates could cause customers for our instruments and reagents to delay or forgo purchases of these products. The future demand for our products and services could also be impacted by deterioration in healthcare systems’ budgets and/or staffing levels.

Current wording

We have been experiencing, and may continue to experience, some adverse impact to our results of operations due to market dynamics in China, such as volume-based procurement programs (“VoBP”) and the government’s focus to improve compliance of healthcare practitioners. Also, reductions or delays in governmental research funding has caused customers for certain of our instruments to delay or forgo purchases of these products. Higher interest rates could also reduce the demand for capital purchases. Additionally, the future demand for our products and services could also be impacted by deterioration in healthcare systems’ budgets and/or staffing levels.

Previous wording

Additionally, we have experienced, and may continue to experience, temporary shortages in supply of certain materials or components that are used in our products. The stable flow of global transport is critical to our operations and as such, events affecting the flow of logistics around the globe may adversely impact our supply chain and distribution channels. In general, major disruptions in the sourcing, manufacturing and distribution of our products could adversely impact our results of operations. Also, tariffs, sanctions or other trade barriers imposed by the United States, including those relating to China, Mexico or other countries and regions in which we do business, could adversely impact our supply chain costs and our results of operations. The ultimate impact of any new tariffs is subject to a number of factors including the effective date and duration of such tariffs, changes in the amount, scope and nature of the tariffs in the future, any countermeasures that the target countries may take and any mitigating actions that may become available.

Current wording

Additionally, we have experienced, and may continue to experience, temporary shortages in supply of certain materials or components that are used in our products. The stable flow of global transport is critical to our operations and as such, events affecting the flow of logistics around the globe may adversely impact our supply chain and distribution channels. In general, major disruptions in the sourcing, manufacturing and distribution of our products could adversely impact our results of operations. Also, tariffs, sanctions or other trade barriers imposed by the United States or against the United States from other countries, including those relating to China, Mexico, countries within EMEA, and other countries in which we do business, could adversely impact our supply chain costs, results of operations and our financial condition. In the longer term, the adverse impacts from tariffs to our results of operations within certain markets may negatively impact our ability to continue operating in those markets, particularly in China. Based upon the latest published tariffs in effect as of April 30, 2025, we currently expect an estimated impact of $90 million from tariffs to our fiscal year 2025 operating expense, primarily relating to China and any products (or components) imported from countries across our global supply chain which have no exemption opportunities. We continue to monitor international trade policy-related developments to assess their potential impacts to our operations. The ultimate impact of any existing or new tariffs or other changes in international trade policies is subject to a number of factors including, but not limited to, the duration of such tariffs, changes in tariff rates, the amount, scope and nature of the tariffs, any countermeasures that target countries may take, or any mitigating actions that may become available. While sourcing optimization and tariff exemptions for qualifying products are key aspects of our mitigation strategy, the timing of such or the ultimate results we will realize from these efforts are uncertain.

Previous wording

For additional information on risk factors that may impact our business, results of operations, financial condition and cash flows, see Part II, Item 1A. Risk Factors of this Quarterly Report on Form 10-Q and Part I, Item 1A. Risk Factors of our 2024 Annual Report on Form 10-K (the “2024 Annual Report”).

Current wording

For additional information on risk factors that may impact our business, results of operations, financial condition and cash flows, see Part II, Item 1A. Risk Factors of this Quarterly Report on Form 10-Q, Part II, Item 1A. Risk Factors in our Quarterly Report on Form 10-Q for the period ended December 31, 2024, and Part I, Item 1A. Risk Factors of our 2024 Annual Report on Form 10-K (the “2024 Annual Report”).

Previous wording

For the three months ended December 31, 2024, worldwide revenues of $5.168 billion increased 9.8% from the prior-year period. This increase reflected the following impacts:

Current wording

For the three months ended March 31, 2025, worldwide revenues of $5.272 billion increased 4.5% from the prior-year period. This increase reflected the following impacts:

Previous wording

Cash flows from continuing operating activities were $693 million in the first three months of fiscal year 2025. At December 31, 2024, we had $830 million in cash and equivalents and short-term investments, including restricted cash. We continued to return value to our shareholders in the form of dividends. During the first three months of fiscal year 2025, we paid cash dividends to common shareholders of $302 million.

Current wording

Cash flows from continuing operating activities were $857 million in the first six months of fiscal year 2025. At March 31, 2025, we had $764 million in cash and equivalents and short-term investments, including restricted cash. We continued to return value to our shareholders in the form of dividends. During the first six months of fiscal year 2025, we paid cash dividends to common shareholders of $600 million.

Previous wording

Each reporting period and given our worldwide operations, we face exposure to our results of operations from changes in foreign currencies. We calculate translational foreign currency impacts by converting our current-period local currency financial results using the prior-period foreign currency exchange rates and comparing these adjusted amounts to our current-period results, which allows us to compare results between periods as if exchange rates had remained constant period-over-period. The first quarter fiscal year 2025 impact of foreign currency on our revenues, which is primarily translational, is provided above. The translational impact on our earnings is provided further below. We evaluate our results of operations on both a reported and a foreign currency-neutral basis. As exchange rates are an important factor in understanding period-to-period comparisons, we believe the presentation of results on a foreign currency-neutral basis, excluding translational foreign currency impacts, in addition to reported results helps improve investors’ ability to understand our operating results and evaluate our performance in comparison to prior periods. We use results on a foreign currency-neutral basis as one measure to evaluate our performance. These results should be considered in addition to, not as a substitute for, results reported in accordance with U.S. generally accepted accounting principles ("GAAP"). Results on a foreign currency-neutral basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not measures of performance presented in accordance with U.S. GAAP.

Current wording

Each reporting period and given our worldwide operations, we face exposure to our results of operations from changes in foreign currencies. We calculate translational foreign currency impacts by converting our current-period local currency financial results using the prior-period foreign currency exchange rates and comparing these adjusted amounts to our current-period results, which allows us to compare results between periods as if exchange rates had remained constant period-over-period. The second quarter fiscal year 2025 impact of foreign currency on our revenues, which is primarily translational, is provided above. The translational impact on our earnings is provided further below. We evaluate our results of operations on both a reported and a foreign currency-neutral basis. As exchange rates are an important factor in understanding period-to-period comparisons, we believe the presentation of results on a foreign currency-neutral basis, excluding translational foreign currency impacts, in addition to reported results helps improve investors’ ability to understand our operating results and evaluate our performance in comparison to prior periods. We use results on a foreign currency-neutral basis as one measure to evaluate our performance. These results should be considered in addition to, not as a substitute for, results reported in accordance with U.S. generally accepted accounting principles ("GAAP"). Results on a foreign currency-neutral basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not measures of performance presented in accordance with U.S. GAAP.

Previous wording

The following summarizes first quarter Medical revenues by organizational unit:

Current wording

The following summarizes second quarter Medical revenues by organizational unit:

Previous wording

The Medical segment’s revenue growth in the first quarter of 2025 primarily reflected the following:

Current wording

The Medical segment’s revenue growth in the second quarter of 2025 primarily reflected the following:

Previous wording

•Volume growth and share gains attributable to the Medication Delivery Solutions unit’s Vascular Access Management portfolio, as well as strong sales of the unit’s hypodermic products.

Current wording

•Volume growth attributable to the Medication Delivery Solutions unit’s Vascular Access Management portfolio, as well as strong U.S. sales of the unit’s hypodermic products, partially offset by an expected VoBP impact in China.

Previous wording

•Growth in the Medication Management Solutions unit driven by double-digit growth in sales of infusion systems, partially offset by an unfavorable comparison to dispensing and pharmacy automation installations in the prior-year period.

Current wording

•Growth in the Medication Management Solutions unit driven by double-digit growth in sales of infusion systems, partially offset by the timing of dispensing installations within the current fiscal year.

Previous wording

The Medical segment's operating income as a percentage of revenues in the first quarter of 2025 compared with the first quarter of 2024 reflected the following:

Current wording

The Medical segment's operating income as a percentage of revenues in the second quarter of 2025 compared with the second quarter of 2024 reflected the following:

Previous wording

•Lower gross profit margin in the first quarter of 2025 compared with the first quarter of 2024, which primarily reflected:

Current wording

•Lower gross profit margin in the second quarter of 2025 compared with the second quarter of 2024, which primarily reflected:

Previous wording

◦An unfavorable impact of $180 million due to a fair value step-up adjustment relating to Advanced Patient Monitoring's inventory on the acquisition date and higher amortization of intangible assets attributable to the Advanced Patient Monitoring unit, as well as a charge of $22 million to adjust future costs estimated for product remediation efforts; partially offset by

Current wording

◦An unfavorable impact of $162 million due to a fair value step-up adjustment relating to Advanced Patient Monitoring's inventory on the acquisition date and higher amortization of intangible assets attributable to the Advanced Patient Monitoring unit, as well as a charge of $76 million to adjust future costs estimated for product remediation efforts within the Medication Management Solutions unit; partially offset by

Previous wording

•Higher selling and administrative expense, as well as research and development expense, as percentages of revenues in the first quarter of 2025 compared with the first quarter of 2024 primarily reflected costs attributable to the Advanced Patient Monitoring unit.

Current wording

•Higher selling and administrative expense as a percentage of revenues in the second quarter of 2025 compared with the second quarter of 2024 primarily reflected costs attributable to the Advanced Patient Monitoring unit.

Previous wording

The following summarizes first quarter Life Sciences revenues by organizational unit:

Current wording

The following summarizes second quarter Life Sciences revenues by organizational unit:

Previous wording

•Strong growth driven by sales of the Specimen Management unit’s BD Vacutainer TM portfolio and customers’ upgrades to the unit’s higher value products.

Current wording

•Growth driven by U.S. sales of the Specimen Management unit’s BD Vacutainer TM portfolio, partially offset by a decline in China.

Previous wording

The Life Sciences segment's operating income as a percentage of revenues in the first quarter of 2025 compared with the first quarter of 2024 primarily reflected the following:

Current wording

The Life Sciences segment's operating income as a percentage of revenues in the second quarter of 2025 compared with the second quarter of 2024 primarily reflected the following:

Previous wording

•Higher gross profit margin in the first quarter of 2025 compared with the first quarter of 2024 primarily reflected lower manufacturing costs resulting from continuous improvement projects and other productivity initiatives.

Current wording

•Gross profit margin in the second quarter of 2025 was flat compared with the second quarter of 2024, which primarily reflected lower manufacturing costs resulting from continuous improvement projects and other productivity initiatives, offset by higher labor costs and unfavorable foreign currency translation.

Previous wording

•Selling and administrative expense as a percentage of revenues in the first quarter of 2025 was higher compared with the first quarter of 2024 which primarily reflected higher administrative costs in the current-year period.

Current wording

•Selling and administrative expense as a percentage of revenues in the second quarter of 2025 was higher compared with the second quarter of 2024 which primarily reflected higher selling, as well as administrative costs, in the current-year period.

Previous wording

The following summarizes first quarter Interventional revenues by organizational unit:

Current wording

The following summarizes second quarter Interventional revenues by organizational unit:

Previous wording

•Double-digit growth in the Surgery unit’s sales of infection prevention products, as well as strong growth in sales of hernia repair products, particularly the unit’s Phasix TM resorbable scaffold.

Current wording

•Double-digit growth in the Surgery unit’s sales of the Phasix TM hernia resorbable scaffolds, as well as strong growth in sales of biosurgery products, partially offset by pricing adjustments for legacy hernia products in the United States.

Previous wording

•Continued double-digit growth in sales of the Urology and Critical Care unit’s PureWick TMofferings.

Current wording

•A decline in the Urology and Critical Care unit reflected an unfavorable comparison to a prior-period benefit from licensing revenue, partially offset by continued double-digit growth in sales of PureWick TMofferings.

Previous wording

The Interventional segment's operating income as a percentage of revenues in the first quarter of 2025 compared with the first quarter of 2024 reflected the following:

Current wording

The Interventional segment's operating income as a percentage of revenues in the second quarter of 2025 compared with the second quarter of 2024 reflected the following:

Previous wording

•Higher gross profit margin in the first quarter of 2025 compared with the first quarter of 2024, which primarily reflected favorable manufacturing variances and lower manufacturing costs, which resulted from continuous improvement projects and other productivity initiatives.

Current wording

•Higher gross profit margin in the second quarter of 2025 compared with the second quarter of 2024, which primarily reflected favorable manufacturing variances and lower manufacturing costs that resulted from continuous improvement projects and other productivity initiatives, partially offset by an unfavorable comparison to the prior-period benefits from licensing revenue noted above.

Previous wording

•Lower selling and administrative expense and research development expense as percentages of revenues in the first quarter of 2025 compared with the first quarter of 2024, which primarily reflected revenue growth that outpaced spending.

Current wording

•Selling and administrative expense as percentages of revenues in the second quarter of 2025 was flat compared with the second quarter of 2024, which primarily reflected higher revenues, offset by lower selling costs

Previous wording

BD’s worldwide first quarter revenues by geography were as follows:

Current wording

BD’s worldwide second quarter revenues by geography were as follows:

Previous wording

U.S. revenue growth in the first quarter of 2025 reflected strong sales in the Medical segment’s Medication Delivery Solutions and Medication Management Solutions units, as well as solid growth across all of the Interventional segment’s units. Overall U.S. revenue growth also reflected the acquired Advanced Patient Monitoring unit’s sales. U.S. revenue growth in the first quarter of 2025 was partially offset by a decline in the Medical segment’s Pharmaceutical Systems unit, as further discussed above.

Current wording

U.S. revenue growth in the second quarter of 2025 was primarily driven by the acquired Advanced Patient Monitoring unit’s sales, as well as strong sales in the Medical segment’s Medication Management Solutions and Medication Delivery Solutions units. U.S. revenue growth in the second quarter of 2025 was partially offset by a decline in the Interventional segment’s Urology and Critical Care unit, as further discussed above.

Previous wording

International revenue growth in the first quarter of 2025 was primarily driven by the Medical segment’s Medication Delivery Solutions unit. Overall international revenue growth in the first quarter of 2025 also reflected the acquired Advanced Patient Monitoring unit’s sales. International revenue growth in the first quarter of 2025 was partially offset by a decline in the Life Sciences segment’s Biosciences unit, as further discussed above. Current-period revenues in emerging markets primarily reflected strong sales in certain countries within Greater Asia, as well as in EMA, partially offset by a decline in China driven by unfavorable market dynamics, as further discussed above:

Current wording

International revenue growth in the second quarter of 2025 was primarily driven by the acquired Advanced Patient Monitoring unit’s sales and growth in the Medical segment’s Pharmaceutical Systems unit. International revenue growth in the second quarter of 2025 was partially offset by a decline in the Life Sciences segment’s Biosciences unit, as further discussed above. Current-period revenues in emerging markets primarily reflected strong sales in Latin America and in certain countries within Greater Asia, partially offset by a decline in China driven by unfavorable market dynamics, as further discussed above:

Previous wording

Reflected in the financial results for the three-month periods of fiscal years 2025 and 2024 were the following specified items:

Current wording

Reflected in the financial results for the three and six-month periods of fiscal years 2025 and 2024 were the following specified items:

Previous wording

(c)Represents costs recorded to Other operating expense, net and incurred in connection with the separation of BD's former Diabetes Care business.

Current wording

(c)Represents costs recorded to Other operating expense (income), net and incurred in connection with the planned separation of BD’s Biosciences and Diagnostic Solutions business and the fiscal year 2022 separation of BD's former Diabetes Care business.

Previous wording

(d)Includes amortization and other adjustments related to the purchase accounting for acquisitions. BD’s amortization expense is recorded in Cost of products sold. The amount in the three-month period of 2025 includes $180 million due to a fair value step-up adjustment relating to Advanced Patient Monitoring's inventory on the acquisition date.

Current wording

(d)Includes amortization and other adjustments related to the purchase accounting for acquisitions. BD’s amortization expense is recorded in Cost of products sold. The amounts in the three and six-month periods of 2025 include $162 million and $342 million, respectively, due to a fair value step-up adjustment relating to Advanced Patient Monitoring's inventory on the acquisition date.

Previous wording

(f)Includes certain (income) expense items which are not part of ordinary operations and affect the comparability of the periods presented. Such items may include certain product remediation costs, certain legal matters, certain investment gains and losses, certain asset impairment charges, and certain pension settlement costs. The amount in the three-month period of 2025 included a charge within Cost of products sold of $22 million to adjust future costs estimated for product remediation efforts, as well as a non-cash $30 million charge recorded within Research and development expense to write down certain assets in the Life Sciences segment. The amount additionally included charges of approximately $29 million which were recorded to Other operating expense, net, and related to various legal matters. Additional disclosures regarding legislative and legal matters are provided in Note 5 in the Notes to Condensed Consolidated Financial Statements.

Current wording

(f)Includes certain (income) expense items which are not part of ordinary operations and affect the comparability of the periods presented. Such items may include certain product remediation costs, certain legal matters, certain investment gains and losses, certain asset impairment charges, and certain pension settlement costs. The amounts in the three and six-month periods of 2025 included charges within Cost of products sold of $76 million and $98 million, respectively, to adjust future costs estimated for product remediation efforts, as well as charges of approximately $32 million and $60 million, respectively, which were recorded to Other operating expense (income), net, and related to various legal matters. Additional disclosures regarding our legal matters are provided in Note 5 in the Notes to Condensed Consolidated Financial Statements. The amount in the six-month period of 2025 additionally included a non-cash $30 million charge recorded within Research and development expense to write down certain assets in the Life Sciences segment.

Previous wording

The comparison of gross profit margin for the three-month periods of fiscal years 2025 and 2024 reflected the following impacts:

Current wording

The comparison of gross profit margin for the three and six-month periods of fiscal years 2025 and 2024 reflected the following impacts:

Previous wording

The unfavorable impact on gross margin for the three-month period of 2025 from specified items reflects amortization of intangibles attributable to the Advanced Patient Monitoring acquisition and an impact of $180 million resulting from a fair value step-up adjustment relating to Advanced Patient Monitoring's inventory on the acquisition date. The impact from specified items in the current-year period also included a $22 million charge recorded in the Medical segment to adjust the estimate of future product remediation costs, as further discussed in Note 5 in the Notes to Condensed Consolidated Financial Statements.

Current wording

The unfavorable impacts on gross margin for the three and six-month periods of 2025 from specified items reflect amortization of intangibles attributable to the Advanced Patient Monitoring acquisition and impacts of $162 million and $342 million, respectively, resulting from a fair value step-up adjustment relating to Advanced Patient Monitoring's inventory on the acquisition date. The impacts from specified items in the three and six-month periods of 2025 periods also included charges of $76 million and $98 million, respectively, recorded in the Medical segment to adjust the estimate of future product remediation costs, as further discussed in Note 5 in the Notes to Condensed Consolidated Financial Statements.

Previous wording

Operating performance in the three-month period of 2025 compared with the prior-year period primarily reflected lower manufacturing costs resulting from our ongoing continuous improvement projects and other productivity initiatives, partially offset by higher labor costs.

Current wording

Operating performance in the three and six-month periods of 2025 compared with the prior-year periods primarily reflected lower manufacturing costs resulting from our ongoing continuous improvement projects and other productivity initiatives, partially offset by higher labor costs.

Previous wording

A summary of operating expenses for the three-month period of fiscal years 2025 and 2024 is as follows:

Current wording

A summary of operating expenses for the three and six-month periods of fiscal years 2025 and 2024 is as follows:

Previous wording

Selling and administrative expense as a percentage of revenues in the three-month period of 2025 was lower compared with the prior-year periods, which primarily reflected higher revenues, partially offset by higher selling costs in the current-year period.

Current wording

Selling and administrative expense as a percentage of revenues in the three and six-month periods of 2025 was higher compared with the prior-year periods, which primarily reflected higher revenues, partially offset by higher selling costs in the current-year periods.

Previous wording

Higher research and development expense as a percentage of revenues in the three-month period of 2025 primarily reflected a $30 million write-down of certain assets in the Life Sciences segment and the timing of project spending.

Current wording

Lower research and development expense as a percentage of revenues in the three-month period of 2025 primarily reflected the timing of project spending. Higher research and development expense as a percentage of revenues in the six-month period of 2025 primarily reflected a $30 million write-down of certain assets in the Life Sciences segment.

Previous wording

The amount in the three-month period of 2025 primarily included restructuring costs related to simplification and other cost-saving initiatives, as well as restructuring, integration and transaction costs relating to our acquisition of the Advanced Patient Monitoring unit. For further disclosures regarding restructuring costs, refer to Note 10 in the Notes to Condensed Consolidated Financial Statements.

Current wording

The amounts in the three and six-month periods of 2025 and 2024 included restructuring costs related to simplification and other cost-saving initiatives. The amounts in the three and six-month periods of 2025 additionally included restructuring, integration and transaction costs relating to our acquisition of the Advanced Patient Monitoring unit. For further disclosures regarding restructuring costs, refer to Note 10 in the Notes to Condensed Consolidated Financial Statements.

Previous wording

The amount in the three-month period of 2025 largely represented charges relating to legal matters. Additional disclosures regarding legislative and legal matters are provided in Note 5 in the Notes to Condensed Consolidated Financial Statements.

Current wording

The amount in the three and six-month periods of 2025 largely represented charges relating to legal matters. Additional disclosures regarding legislative and legal matters are provided in Note 5 in the Notes to Condensed Consolidated Financial Statements.