GE HealthCare reports fourth quarter and full year 2024 financial results

Segment

($ in millions)

Imaging

Advanced

Visualization Solutions

Patient Care

Solutions

Pharmaceutical

Diagnostics

Segment Revenues

$2,393

$1,440

$827

$646

YoY % change

—%

4%

—%

9%

YoY % Organic* change

—%

4%

—%

9%

Segment EBIT

$302

$374

$106

$212

YoY % change

19%

15%

(4)%

47%

Segment EBIT Margin

12.6%

25.9%

12.8%

32.9%

YoY change

200 bps

240 bps

(50) bps

850 bps

^{YoY refers to year-over-year comparison on a recast basis}

^{Results recast in line with move of Image Guided Therapies from Imaging to Advanced Visualization Solutions}

Consolidated and Combined Statements of Income

For the three months ended December 31

(In millions, except per share amounts)

2024

2023

Sales of products

$

3,621

$

3,597

Sales of services

1,698

1,609

Total revenues

5,319

5,206

Cost of products

2,226

2,268

Cost of services

818

782

Gross profit

2,275

2,156

Selling, general, and administrative

1,130

1,152

Research and development

344

315

Total operating expenses

1,474

1,467

Operating income

801

689

Interest and other financial charges – net

121

131

Non-operating benefit (income) costs

(100

)

(50

)

Other (income) expense – net

(53

)

(1

)

Income from continuing operations before income taxes

834

609

Benefit (provision) for income taxes

(96

)

(193

)

Net income from continuing operations

737

416

Income (loss) from discontinued operations, net of taxes

—

—

Net income

737

416

Net (income) loss attributable to noncontrolling interests

(17

)

(13

)

Net income attributable to GE HealthCare

720

403

Deemed preferred stock dividend of redeemable noncontrolling interest

—

—

Net income attributable to GE HealthCare common stockholders

$

720

$

403

Earnings per share from continuing operations attributable to GE HealthCare common stockholders:

Basic

$

1.58

$

0.89

Diluted

1.57

0.88

Earnings per share attributable to GE HealthCare common stockholders:

Basic

$

1.58

$

0.89

Diluted

1.57

0.88

Weighted-average number of shares outstanding:

Basic

457

455

Diluted

459

458

Consolidated and Combined Statements of Income

For the years ended December 31

(In millions, except per share amounts)

2024

2023

2022

Sales of products

$

13,075

$

13,127

$

12,044

Sales of services

6,597

6,425

6,297

Total revenues

19,672

19,552

18,341

Cost of products

8,271

8,465

7,975

Cost of services

3,196

3,165

3,187

Gross profit

8,205

7,922

7,179

Selling, general, and administrative

4,269

4,282

3,631

Research and development

1,311

1,205

1,026

Total operating expenses

5,580

5,487

4,657

Operating income

2,625

2,435

2,522

Interest and other financial charges – net

504

542

77

Non-operating benefit (income) costs

(406

)

(382

)

(5

)

Other (income) expense – net

(55

)

(86

)

(62

)

Income from continuing operations before income taxes

2,581

2,361

2,512

Benefit (provision) for income taxes

(531

)

(743

)

(563

)

Net income from continuing operations

2,050

1,618

1,949

Income (loss) from discontinued operations, net of taxes

—

(4

)

18

Net income

2,050

1,614

1,967

Net (income) loss attributable to noncontrolling interests

(57

)

(46

)

(51

)

Net income attributable to GE HealthCare

1,993

1,568

1,916

Deemed preferred stock dividend of redeemable noncontrolling interest

—

(183

)

—

Net income attributable to GE HealthCare common stockholders

$

1,993

$

1,385

$

1,916

Earnings per share from continuing operations attributable to GE HealthCare common stockholders:

Basic

$

4.37

$

3.06

$

4.18

Diluted

4.34

3.04

4.18

Earnings per share attributable to GE HealthCare common stockholders:

Basic

$

4.37

$

3.05

$

4.22

Diluted

4.34

3.03

4.22

Weighted-average number of shares outstanding:

Basic

456

455

454

Diluted

459

458

454

Consolidated Statements of Financial Position

As of

(In millions, except share and per share amounts)

December 31, 2024

December 31, 2023

Cash, cash equivalents, and restricted cash

$

2,889

$

2,504

Receivables – net of allowances of $103 and $98

3,564

3,525

Due from related parties

5

32

Inventories

1,939

1,960

Contract and other deferred assets

974

1,000

All other current assets

529

389

Current assets

9,901

9,410

Property, plant, and equipment – net

2,550

2,500

Goodwill

13,136

12,936

Other intangible assets – net

1,078

1,253

Deferred income taxes

4,474

4,474

All other non-current assets

1,950

1,881

Total assets

$

33,089

$

32,454

Short-term borrowings

$

1,502

$

1,006

Accounts payable

3,022

2,947

Due to related parties

20

99

Contract liabilities

1,943

1,918

Current compensation and benefits

1,521

1,518

All other current liabilities

1,545

1,493

Current liabilities

9,553

8,981

Long-term borrowings

7,449

8,436

Non-current compensation and benefits

5,583

5,782

Deferred income taxes

56

68

All other non-current liabilities

1,796

1,877

Total liabilities

24,437

25,144

Commitments and contingencies

Redeemable noncontrolling interests

188

165

Common stock, par value $0.01 per share, 1,000,000,000 shares authorized, 457,246,971 shares issued as of December 31, 2024; 455,342,290 shares issued as of December 31, 2023

5

5

Treasury stock, at cost, 291,053 shares as of December 31, 2024 and 0 shares as of December 31, 2023

(25

)

—

Additional paid-in capital

6,583

6,493

Retained earnings

3,262

1,326

Accumulated other comprehensive income (loss) – net

(1,379

)

(691

)

Total equity attributable to GE HealthCare

8,446

7,133

Noncontrolling interests

18

12

Total equity

8,464

7,145

Total liabilities, redeemable noncontrolling interests, and equity

$

33,089

$

32,454

Consolidated and Combined Statements of Cash Flows

For the years ended December 31

(In millions)

2024

2023

2022

Net income

$

2,050

$

1,614

$

1,967

Less: Income (loss) from discontinued operations, net of taxes

—

(4

)

18

Net income from continuing operations

$

2,050

$

1,618

$

1,949

Adjustments to reconcile Net income from continuing operations to Cash from (used for) operating activities – continuing operations

Depreciation of property, plant, and equipment

268

248

228

Amortization of intangible assets

312

362

405

Gain on fair value remeasurement of contingent consideration

(19

)

(17

)

(65

)

Net periodic postretirement benefit plan (income) expense

(357

)

(332

)

9

Postretirement plan contributions

(332

)

(357

)

(18

)

Share-based compensation

125

114

67

Provision for income taxes

531

743

563

Cash paid during the year for income taxes

(491

)

(474

)

(851

)

Changes in operating assets and liabilities, excluding the effects of acquisitions:

Receivables

(178

)

(185

)

(231

)

Due from related parties

25

4

13

Inventories

(81

)

111

(402

)

Contract and other deferred assets

3

10

(222

)

Accounts payable

126

(13

)

481

Due to related parties

(61

)

(84

)

(33

)

Contract liabilities

68

26

138

Current compensation and benefits

39

153

(37

)

All other operating activities – net

(74

)

174

140

Cash from (used for) operating activities – continuing operations

1,955

2,101

2,134

Cash flows – investing activities

Additions to property, plant and equipment and internal-use software

(401

)

(387

)

(310

)

Dispositions of property, plant, and equipment

—

1

4

Purchases of businesses, net of cash acquired

(313

)

(147

)

—

Purchases of investments

(40

)

(48

)

(59

)

All other investing activities – net

(160

)

23

(33

)

Cash from (used for) investing activities – continuing operations

(914

)

(558

)

(398

)

Cash flows – financing activities

Net increase (decrease) in borrowings (maturities of 90 days or less)

—

(12

)

9

Newly issued debt, net of debt issuance costs (maturities longer than 90 days)

995

2,006

8,198

Repayments and other reductions (maturities longer than 90 days)

(1,418

)

(855

)

(3

)

Dividends paid to stockholders

(55

)

(41

)

—

Redemption of noncontrolling interests

—

(211

)

—

Net transfers (to) from GE

—

(1,317

)

(8,934

)

Proceeds from stock issued under employee benefit plans

33

34

—

Taxes paid related to net share settlement of equity awards

(93

)

(33

)

—

All other financing activities – net

(34

)

(49

)

(92

)

Cash from (used for) financing activities – continuing operations

(573

)

(478

)

(822

)

Cash from (used for) operating activities – discontinued operations

(4

)

—

(21

)

Effect of foreign currency rate changes on cash, cash equivalents, and restricted cash

(77

)

(10

)

(3

)

Increase (decrease) in cash, cash equivalents, and restricted cash

387

1,055

890

Cash, cash equivalents, and restricted cash at beginning of year

2,506

1,451

561

Cash, cash equivalents, and restricted cash at end of year

$

2,893

$

2,506

$

1,451

Supplemental disclosure of cash flows information

Cash paid during the year for interest

$

(550

)

$

(570

)

$

—

Non-cash investing activities

Acquired but unpaid property, plant, and equipment

$

143

$

140

$

136

Organic Revenue*

Unaudited

For the three months ended December 31

For the years ended December 31

($ in millions)

2024

2023

% change

2024

2023

% change

Imaging revenues

$

2,393

$

2,392

—

%

$

8,855

$

8,944

(1

)%

Less: Acquisitions(1)

17

—

47

—

Less: Dispositions(2)

—

—

—

—

Less: Foreign currency exchange

(7

)

—

(71

)

—

Imaging Organic revenue*

$

2,383

$

2,392

—

%

$

8,880

$

8,944

(1

)%

AVS revenues

$

1,440

$

1,382

4

%

$

5,131

$

5,094

1

%

Less: Acquisitions(1)

—

—

—

—

Less: Dispositions(2)

—

—

—

—

Less: Foreign currency exchange

(4

)

—

(25

)

—

AVS Organic revenue*

$

1,443

$

1,382

4

%

$

5,157

$

5,094

1

%

PCS revenues

$

827

$

827

—

%

$

3,125

$

3,142

(1

)%

Less: Acquisitions(1)

—

—

—

—

Less: Dispositions(2)

—

—

—

—

Less: Foreign currency exchange

(2

)

—

(6

)

—

PCS Organic revenue*

$

829

$

827

—

%

$

3,131

$

3,142

—

%

PDx revenues

$

646

$

591

9

%

$

2,508

$

2,306

9

%

Less: Acquisitions(1)

—

—

—

—

Less: Dispositions(2)

—

—

—

—

Less: Foreign currency exchange

3

—

(10

)

—

PDx Organic revenue*

$

642

$

591

9

%

$

2,518

$

2,306

9

%

Other revenues

$

13

$

14

(4

)%

$

52

$

66

(21

)%

Less: Acquisitions(1)

—

—

—

—

Less: Dispositions(2)

—

—

—

—

Less: Foreign currency exchange

—

—

—

—

Other Organic revenue*

$

13

$

14

(4

)%

$

52

$

66

(21

)%

Total revenues

$

5,319

$

5,206

2

%

$

19,672

$

19,552

1

%

Less: Acquisitions(1)

17

—

47

—

Less: Dispositions(2)

—

—

—

—

Less: Foreign currency exchange

(8

)

—

(112

)

—

Organic revenue*

$

5,310

$

5,206

2

%

$

19,737

$

19,552

1

%

Represents revenues attributable to acquisitions from the date the Company completed the transaction through the end of four quarters following the transaction.

(2)

Represents revenues attributable to dispositions for the four quarters preceding the disposition date.

Adjusted EBIT*

Unaudited

For the three months ended December 31

For the years ended December 31

($ in millions)

2024

2023

% change

2024

2023

% change

Net income attributable to GE HealthCare

$

720

$

403

79

%

$

1,993

$

1,568

27

%

Add: Interest and other financial charges – net

121

131

504

542

Add: Non-operating benefit (income) costs

(100

)

(50

)

(406

)

(382

)

Less: Benefit (provision) for income taxes

(96

)

(193

)

(531

)

(743

)

Less: Income (loss) from discontinued operations, net of taxes

—

—

—

(4

)

Less: Net (income) loss attributable to noncontrolling interests

(17

)

(13

)

(57

)

(46

)

EBIT*

$

854

$

690

24

%

$

2,679

$

2,521

6

%

Add: Restructuring costs(1)

30

20

120

54

Add: Acquisition and disposition-related charges (benefits)(2)

9

—

3

(15

)

Add: Spin-Off and separation costs(3)

68

95

251

270

Add: (Gain) loss on business and asset dispositions(4)

—

—

—

—

Add: Amortization of acquisition-related intangible assets

36

32

137

127

Add: Investment revaluation (gain) loss(5)

(4

)

—

22

(1

)

Adjusted EBIT*

$

994

$

837

19

%

$

3,211

$

2,956

9

%

Net income margin

13.5

%

7.7

%

580 bps

10.1

%

8.0

%

210 bps

Adjusted EBIT margin*

18.7

%

16.1

%

260 bps

16.3

%

15.1

%

120 bps

(1)

Consists of severance, facility closures, and other charges associated with restructuring programs.

(2)

Consists of legal, consulting, and other transaction and integration fees, and adjustments to contingent consideration, as well as other purchase accounting related charges and other costs directly related to the transactions.

(3)

Costs incurred in the Spin-Off and separation from GE, including system implementations, audit and advisory fees, legal entity separation, Founders Grant equity awards, separation agreements with GE, and other one-time costs.

(4)

Consists of gains and losses resulting from the sale of assets and investments.

(5)

Primarily relates to valuation adjustments for equity investments.

Adjusted Net Income*

Unaudited

For the three months ended December 31

For the years ended December 31

($ in millions)

2024

2023

% change

2024

2023

% change

Net income attributable to GE HealthCare

$

720

$

403

79

%

$

1,993

$

1,568

27

%

Add: Non-operating benefit (income) costs

(100

)

(50

)

(406

)

(382

)

Add: Restructuring costs(1)

30

20

120

54

Add: Acquisition and disposition-related charges (benefits)(2)

9

—

3

(15

)

Add: Spin-Off and separation costs(3)

68

95

251

270

Add: (Gain) loss on business and asset dispositions(4)

—

—

—

—

Add: Amortization of acquisition-related intangible assets

36

32

137

127

Add: Investment revaluation (gain) loss(5)

(4

)

—

22

(1

)

Add: Tax effect of reconciling items(6)

(16

)

(21

)

(42

)

(24

)

Add: Spin-Off and other tax adjustments(7)

(78

)

60

(17

)

196

Less: Income (loss) from discontinued operations, net of taxes

—

—

—

(4

)

Adjusted net income*

$

666

$

539

24

%

$

2,060

$

1,797

15

%

(1)

Consists of severance, facility closures, and other charges associated with restructuring programs.

(2)

Consists of legal, consulting, and other transaction and integration fees, and adjustments to contingent consideration, as well as other purchase accounting related charges and other costs directly related to the transactions.

(3)

Costs incurred in the Spin-Off and separation from GE, including system implementations, audit and advisory fees, legal entity separation, Founders Grant equity awards, separation agreements with GE, and other one-time costs.

(4)

Consists of gains and losses resulting from the sale of assets and investments.

(5)

Primarily relates to valuation adjustments for equity investments.

(6)

The tax effect of reconciling items is calculated using the statutory tax rate, taking into consideration the nature of the items and the relevant taxing jurisdiction.

(7)

Consists of certain income tax adjustments, including the accrual of a deferred tax liability on the prior period earnings of certain of the Company’s foreign subsidiaries for which the Company is no longer permanently reinvested, the impact of adjusting deferred tax assets and liabilities to stand-alone GE HealthCare tax rates, and the impact of tax legislation changes. As of the third quarter of 2024 this line additionally includes discrete tax impacts resulting from the Spin-Off and separation from GE previously reported under Tax effect of reconciling items.

Adjusted Earnings Per Share*

Unaudited

For the three months ended December 31

For the years ended December 31

(In dollars, except shares outstanding presented in millions)

2024

2023

$ change

2024

2023

$ change

Diluted earnings per share – continuing operations

$

1.57

$

0.88

$

0.69

$

4.34

$

3.04

$

1.31

Add: Deemed preferred stock dividend of redeemable noncontrolling interest

—

—

—

0.40

Add: Non-operating benefit (income) costs

(0.22

)

(0.11

)

(0.88

)

(0.83

)

Add: Restructuring costs(1)

0.06

0.04

0.26

0.12

Add: Acquisition and disposition-related charges (benefits)(2)

0.02

—

0.01

(0.03

)

Add: Spin-Off and separation costs(3)

0.15

0.21

0.55

0.59

Add: (Gain) loss on business and asset dispositions(4)

—

—

—

—

Add: Amortization of acquisition-related intangible assets

0.08

0.07

0.30

0.28

Add: Investment revaluation (gain) loss(5)

(0.01

)

—

0.05

(0.00

)

Add: Tax effect of reconciling items(6)

(0.03

)

(0.05

)

(0.09

)

(0.05

)

Add: Spin-Off and other tax adjustments(7)

(0.17

)

0.13

(0.04

)

0.43

Adjusted earnings per share*

$

1.45

$

1.18

$

0.27

$

4.49

$

3.93

$

0.56

Diluted weighted-average shares outstanding

459

458

459

458

(1)

Consists of severance, facility closures, and other charges associated with restructuring programs.

(2)

Consists of legal, consulting, and other transaction and integration fees, and adjustments to contingent consideration, as well as other purchase accounting related charges and other costs directly related to the transactions.

(3)

Costs incurred in the Spin-Off and separation from GE, including system implementations, audit and advisory fees, legal entity separation, Founders Grant equity awards, separation agreements with GE, and other one-time costs.

(4)

Consists of gains and losses resulting from the sale of assets and investments.

(5)

Primarily relates to valuation adjustments for equity investments.

(6)

The tax effect of reconciling items is calculated using the statutory tax rate, taking into consideration the nature of the items and the relevant taxing jurisdiction.

(7)

Consists of certain income tax adjustments, including the accrual of a deferred tax liability on the prior period earnings of certain of the Company’s foreign subsidiaries for which the Company is no longer permanently reinvested, the impact of adjusting deferred tax assets and liabilities to stand-alone GE HealthCare tax rates, and the impact of tax legislation changes. As of the third quarter of 2024 this line additionally includes discrete tax impacts resulting from the Spin-Off and separation from GE previously reported under Tax effect of reconciling items.

Adjusted Tax Expense* and Adjusted ETR*

Unaudited

For the three months ended December 31

For the years ended December 31

($ in millions)

2024

2023

2024

2023

Benefit (provision) for income taxes

$

(96

)

$

(193

)

$

(531

)

$

(743

)

Add: Tax effect of reconciling items(1)

(16

)

(21

)

(42

)

(24

)

Add: Spin-Off and other tax adjustments(2)

(78

)

60

(17

)

196

Adjusted tax expense*

$

(189

)

$

(154

)

$

(590

)

$

(571

)

Effective tax rate

11.5

%

31.7

%

20.6

%

31.5

%

Adjusted effective tax rate*

21.7

%

21.8

%

21.8

%

23.7

%

(1)

The tax effect of reconciling items is calculated using the statutory tax rate, taking into consideration the nature of the items and the relevant taxing jurisdiction.

(2)

Consists of certain income tax adjustments, including the accrual of a deferred tax liability on the prior period earnings of certain of the Company’s foreign subsidiaries for which the Company is no longer permanently reinvested, the impact of adjusting deferred tax assets and liabilities to stand-alone GE HealthCare tax rates, and the impact of tax legislation changes. As of the third quarter of 2024 this line additionally includes discrete tax impacts resulting from the Spin-Off and separation from GE previously reported under Tax effect of reconciling items.

Free Cash Flow*

Unaudited

For the three months ended December 31

For the years ended December 31

($ in millions)

2024

2023

% change

2024

2023

% change

Cash from (used for) operating activities – continuing operations

$

913

$

1,050

(13

)%

$

1,955

$

2,101

(7

)%

Cash flow conversion

98

%

134

%

(36

)pts

Add: Additions to PP&E and internal-use software

(102

)

(94

)

(401

)

(387

)

Add: Dispositions of PP&E

—

—

—

1

Free cash flow*

$

811

$

956

(15

)%

$

1,554

$

1,715

(9

)%

Free cash flow conversion*

75

%

95

%

(20

)pts