Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Part I. Financial Information
Index
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”)			Page
Trends and Factors Impacting Our Performance			30
Summary of Key Performance Measures			31
Results of Operations			31
Results of Operations – Segments			35
Non-GAAP Financial Measures			36
Liquidity and Capital Resources			40
Recently Issued Accounting Pronouncements			41
Critical Accounting Estimates			41

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and corresponding notes included elsewhere in this Quarterly Report on Form 10-Q. The following discussion and analysis provide information management believes to be relevant to understanding the financial condition and results of operations of GE HealthCare Technologies Inc. and its subsidiaries (“GE HealthCare,” the “Company,” “our,” “us,” or “we”) for the three and six months ended June 30, 2024 and 2023. For a full understanding of our financial condition and results of operations, the below discussion should be read alongside the Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. This discussion contains forward-looking statements that are based upon current expectations and are subject to uncertainty and changes in circumstances; see “Forward-Looking Statements.” Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed below and elsewhere in this Quarterly Report on Form 10-Q, and particularly in Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

On January 3, 2023, the General Electric Company, which now operates as GE Aerospace, (“GE”) completed the spin-off of GE HealthCare Technologies Inc. (the “Spin-Off”). For further information regarding the Spin-Off, refer to Note 1, “Organization and Basis of Presentation.”

The following tables are presented in millions of United States (“U.S.”) dollars unless otherwise stated, except for per-share amounts which are presented in U.S. dollars. Certain columns and rows throughout this document may not sum due to the use of rounded numbers. Percentages presented are calculated from the underlying whole-dollar amounts.

As of June 30, 2024, GE HealthCare’s operations were organized and managed through four reportable segments: Imaging, Ultrasound, Patient Care Solutions (“PCS”), and Pharmaceutical Diagnostics (“PDx”) and we evaluated their operating performance using Segment revenues and Segment EBIT.

TRENDS AND FACTORS IMPACTING OUR PERFORMANCE

We believe that our performance and future success depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and particularly in Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

KEY TRENDS AFFECTING RESULTS OF OPERATIONS.

Russia and Ukraine Conflict

We had $126 million and $153 million of assets in, or directly related to, Russia and Ukraine as of June 30, 2024 and December 31, 2023, respectively, none of which are subject to sanctions that impact the carrying value of the assets. We generated revenues of $161 million and $155 million from customers in these two countries for the six months ended June 30, 2024 and 2023, respectively. The potential inability to repatriate earnings from these two countries will not have a material impact on our ability to operate.

We continue to monitor the effects of Russia’s invasion of Ukraine, including the consideration of financial impact, cybersecurity risks, the applicability and effect of sanctions, and the employee base in Ukraine and Russia. In May 2023, the U.S. Department of Commerce implemented expanded measures that required us to obtain a license for the export, re-export, or transfer of specified medical equipment and spare parts to customers in Russia. As of April 29, 2024, this requirement has been modified to permit us to export, re-export, or transfer medical equipment and spare parts that meet stated criteria under a License Exception, which is expected to eliminate the need for us to obtain individual U.S. licenses in most cases. The European Union and other countries have also expanded licensing requirements for certain spare parts, services, software, and other items. We will continue to apply for licenses to supply to these customers and to support our business in Russia, as required. The implementation of these measures affected our ability to supply customers in Russia during the first two quarters of 2024 and the last three quarters of 2023 and will continue to do so as we confirm applicability of the new U.S. License Exception to our transactions and continue to obtain licenses. There is no guarantee we will obtain all of the licenses for which we applied, that any approvals we obtain will be on a timely basis, or that our business in Russia will not be further disrupted due to evolving legal or operational considerations. The Board, together with management, will continue to assess whether developments related to the conflict have had, or are reasonably likely to have, a material impact on the Company.

China Market

We continue to monitor developments in the market in China. An anti-corruption campaign directed at the healthcare sector, launched last year, is still ongoing. In addition, in March 2024, the government in China announced a new stimulus program (“2024 stimulus”) that includes the healthcare sector and will be implemented through China’s provinces. Both of these factors have contributed to delayed orders and sales in our China business, including in the first half of 2024. We expect the 2024 stimulus program will result in opportunities for our business in China in the longer term, but it has had a short-term impact as provinces develop and announce their plans and customers wait to understand the details of the 2024 stimulus before making purchasing decisions. We expect the effects of the anti-corruption campaign and the delay in China 2024 stimulus to continue to impact our orders and sales in the near term, although we are unable to predict the exact duration or magnitude of the impact. We expect both of these impacts to be temporary, and we believe the focus of government policy in China on expanding access to healthcare will benefit our business in China in the long term.

Tax Valuation Allowances

Deferred income tax assets represent amounts available to reduce income taxes payable on taxable income in future years. We evaluate the recoverability of these future tax deductions and credits by evaluating all available positive and negative evidence. We have a valuation allowance against certain U.S. and foreign deferred tax assets and will release the valuation allowance when there is sufficient positive evidence to support a conclusion that it is more likely than not the deferred tax assets will be realized. Depending on our operating results in the future, we may release the valuation allowance associated with our Brazil deferred tax assets within the year. The timing and amount of the valuation allowance release could vary based on our assessment of all available evidence. Release of all, or a portion, of the valuation allowance would result in the recognition of certain deferred tax assets and may result in a decrease to income tax expense for the period in which the release is recorded.

SUMMARY OF KEY PERFORMANCE MEASURES

Management reviews and analyzes several key performance measures including Total revenues, remaining performance obligations (“RPO”), Operating income, Net income attributable to GE HealthCare, Earnings per share, and Cash from (used for) operating activities. Management also reviews and analyzes Organic revenue*, Adjusted earnings before interest and taxes* (“Adjusted EBIT*”), Adjusted net income*, Adjusted tax expense*, Adjusted effective tax rate* (“Adjusted ETR*”), Adjusted earnings per share*, and Free cash flow*, which are non-GAAP financial measures. These measures are reviewed and analyzed in order to evaluate our business performance, identify trends affecting our business, allocate capital, and make strategic decisions, including those discussed below. See “Results of Operations” and “Liquidity and Capital Resources” below for further discussion on our key performance measures.

The non-GAAP financial measures should be considered along with the most directly comparable U.S. GAAP financial measures. Definitions of these non-GAAP financial measures, a discussion of why we believe they are useful to management and investors as well as certain of their limitations, and reconciliations to their most directly comparable U.S. GAAP financial measures are provided below under “Non-GAAP Financial Measures.”

RESULTS OF OPERATIONS

The following tables set forth our results of operations for each of the periods presented.

Condensed Consolidated Statements of Income			For the three months ended June 30									For the six months ended June 30
			2024			2023						2024			2023
Sales of products			$	3,207		$	3,213					$	6,253		$	6,344
Sales of services			1,632			1,604						3,237			3,180
Total revenues			4,839			4,817						9,489			9,524
Cost of products			2,045			2,084						4,012			4,121
Cost of services			792			793						1,574			1,572
Gross profit			2,002			1,940						3,904			3,831
Selling, general, and administrative			1,067			1,072						2,105			2,134
Research and development			327			298						651			568
Total operating expenses			1,395			1,370						2,756			2,702
Operating income			608			570						1,148			1,129
Interest and other financial charges – net			131			137						254			273
Non-operating benefit (income) costs			(101)			(123)						(204)			(238)
Other (income) expense – net			(1)			(14)						8			(22)
Income before income taxes			578			570						1,090			1,116
Benefit (provision) for income taxes			(143)			(137)						(267)			(300)
Net income			435			433						823			816
Net (income) loss attributable to noncontrolling interests			(7)			(15)						(21)			(26)
Net income attributable to GE HealthCare			$	428		$	418					$	802		$	790

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*Non-GAAP Financial Measure

TOTAL REVENUES AND RPO.

Revenues by Segment			For the three months ended June 30															For the six months ended June 30
			2024			2023			% change			% organic change*						2024			2023			% change			% organic change*
Segment revenues
Imaging			$	2,596		$	2,620		(1)%			—%						$	5,062		$	5,116		(1)%			—%
Ultrasound			823			839			(2)%			(1)%						1,647			1,698			(3)%			(2)%
PCS			772			770			—%			1%						1,519			1,551			(2)%			(2)%
PDx			639			568			12%			14%						1,238			1,126			10%			11%
Other(1)			9			20												24			33
Total revenues			$	4,839		$	4,817		—%			1%						$	9,489		$	9,524		—%			—%

(1) Financial information not presented within the reportable segments, shown within the Other category, represents HealthCare Financial Services which does not meet the definition of an operating segment.

Revenues by Region			For the three months ended June 30												For the six months ended June 30
			2024			2023			% change						2024			2023			% change
United States and Canada (“USCAN”)			$	2,243		$	2,139		5%						$	4,336		$	4,222		3%
Europe, the Middle East, and Africa (“EMEA”)			1,206			1,216			(1)%						2,380			2,384			—%
China region			583			714			(18)%						1,180			1,386			(15)%
Rest of World			807			748			8%						1,592			1,532			4%
Total revenues			$	4,839		$	4,817		—%						$	9,489		$	9,524		—%

For the three months ended June 30, 2024

Total revenues were $4,839 million, approximately flat as reported and growing 1% organically*. Sales of services increased 2% or $28 million primarily due to increased pricing, partially offset by a decrease in Sales of products of $6 million following double digit reported product revenue growth in the prior year, which benefited from improved supply chain fulfillment.

The segment revenues were as follows:

• Imaging segment revenues were $2,596 million, decreasing 1% or $24 million following high single digit Organic revenue growth* in the prior year, which benefited from improved supply chain fulfillment, and current year sales impacted by lower volume in China and unfavorable foreign currency impacts;

• Ultrasound segment revenues were $823 million, decreasing 2% or $16 million primarily due to lower sales volume in China and unfavorable foreign currency impacts;

• PCS segment revenues were $772 million, flat to the prior year and growing 1% organically*, following high single digit Organic revenue growth* in the prior year, which benefited from improved fulfillment; and

• PDx segment revenues were $639 million, growing 12% or $71 million with growth in the EMEA and USCAN regions driven by growth in volume, an increase in price, and new product introductions.

The regional revenues were as follows:

• USCAN revenues were $2,243 million, growing 5% or $104 million with growth across all segment revenues, led by double-digit growth in PDx;

• EMEA revenues were $1,206 million, decreasing 1% or $10 million, following high single digit growth in the prior year, with declines in Imaging and PCS revenues largely offset by increases in PDx and Ultrasound revenues;

• China region revenues were $583 million, decreasing 18% or $131 million with declines in all segment revenues following double digit growth in the prior year due to the impact from the 2022 COVID stimulus programs and current year sales impacted by the delayed 2024 stimulus and the ongoing anti-corruption campaign; and

• Rest of World revenues were $807 million, growing 8% or $59 million with growth in Imaging and PCS revenues, partially offset by unfavorable foreign currency impacts.

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*Non-GAAP Financial Measure

For the six months ended June 30, 2024

Total revenues were $9,489 million, flat to the prior year both as reported and organically*. The flat result was due to Sales of products decreasing 1% or $91 million, primarily due to decreased volume following double digit reported product revenue growth in the prior year, partially offset by Sales of services increasing 2% or $57 million driven by increased pricing.

The segment revenues were as follows:

• Imaging segment revenues were $5,062 million, decreasing 1% or $54 million following double digit Organic revenue growth* in the prior year, which benefited from improved supply chain fulfillment, and unfavorable foreign currency impacts;

• Ultrasound segment revenues were $1,647 million, decreasing 3% or $51 million following high single digit Organic revenue growth* in the prior year, with current year impacts from lower sales volume in China and unfavorable foreign currency impacts;

• PCS segment revenues were $1,519 million, decreasing 2% or $32 million primarily due to decreased volume following double digit Organic revenue growth* in the prior year; and

• PDx segment revenues were $1,238 million, growing 10% or $112 million with growth in the EMEA and USCAN regions driven by growth in volume, an increase in price, and new product introductions.

The regional revenues were as follows:

• USCAN revenues were $4,336 million, growing 3% or $114 million with growth in PDx and Imaging revenues;

• EMEA revenues were $2,380 million, approximately flat, following high single digit growth in the prior year, with growth in PDx revenues largely offset by decreases in Imaging and PCS revenues;

• China region revenues were $1,180 million, decreasing 15% or $206 million with declines in all segment revenues following double digit growth in the prior year due to the impact from the 2022 COVID stimulus programs and current year sales impacted by the delayed 2024 stimulus and the ongoing anti-corruption campaign; and

• Rest of World revenues were $1,592 million, growing 4% or $60 million with growth in Imaging and PCS revenues, partially offset by unfavorable foreign currency impacts.

Remaining Performance Obligations			As of
			June 30, 2024			December 31, 2023						% change
Products			$	4,648		$	4,930					(6)%
Services			9,883			9,725						2%
Total RPO			$	14,531		$	14,655					(1)%

RPO represents the estimated revenue expected from customer contracts that are partially or fully unperformed inclusive of amounts deferred in contract liabilities, excluding contracts, or portions thereof, that provide the customer with the ability to cancel or terminate without incurring a substantive penalty. RPO as of June 30, 2024 decreased 1% from December 31, 2023, primarily due to fulfillment and cancellations outpacing new contracts, partially offset by the timing of multi-year service contract renewals in USCAN and Rest of World.

OPERATING INCOME, NET INCOME ATTRIBUTABLE TO GE HEALTHCARE, ADJUSTED EBIT, AND ADJUSTED NET INCOME.**

			For the three months ended June 30																		For the six months ended June 30
			2024			% of Total revenues			2023			% of Total revenues			% change						2024			% of Total revenues			2023			% of Total revenues			% change
Operating income			$	608		12.6%			$	570		11.8%			7%						$	1,148		12.1%			$	1,129		11.9%			2%
Net income attributable to GE HealthCare			428			8.9%			418			8.7%			2%						802			8.5%			790			8.3%			2%
Adjusted EBIT*			742			15.3%			711			14.8%			4%						1,423			15.0%			1,375			14.4%			3%
Adjusted net income*			459			9.5%			419			8.7%			10%						872			9.2%			807			8.5%			8%

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*Non-GAAP Financial Measure

For the three months ended June 30, 2024

Operating income was $608 million, an increase of $38 million and 70 basis points as a percent of Total revenues. The increase was due to the following factors:

• Gross profit increased $62 million or 110 basis points as a percent of Total revenues primarily due to a reduction in Cost of products sold. Cost of products sold decreased $39 million or 110 basis points as a percent of Sales of products. The decrease as a percent of sales was driven primarily by cost productivity, partially offset by cost inflation. Cost of services sold decreased $1 million or 90 basis points as a percent of Sales of services. The decrease as a percent of sales was driven by cost productivity and an increase in pricing of our service offerings, partially offset by cost inflation. Included in our total cost of revenue as part of our product investment was $102 million in engineering costs for design follow-through on new product introductions and product lifecycle maintenance subsequent to the initial product launch, compared to $110 million for the prior year comparable period; and

• Total operating expenses increased $25 million due to an increase in Research and Development (“R&D”) investments of $29 million, partially offset by a decrease in Selling, general, and administrative (“SG&A”) expense of $5 million primarily driven by cost saving initiatives, including information technology. As a result, R&D as a percentage of Total revenues increased by 60 basis points while SG&A as a percentage of Total revenues decreased by 20 basis points.

Net income attributable to GE HealthCare and Net income margin were $428 million and 8.9%, an increase of $10 million and 20 basis points, respectively, primarily due to the following factors:

*•*Operating income increased $38 million, as discussed above;

• Interest and other financial charges – net decreased $6 million primarily driven by lower overall borrowings due to the repayments made on the Term Loan Facility;

• Non-operating benefit income decreased $22 million primarily related to lower amortization of net gains on our pension plans;

• Other income (expense) – net decreased $13 million primarily related to derivatives gains occurring in the prior year; and

• Provision for income taxes increased $6 million primarily due to incremental discrete adjustments in the current year. For additional detail regarding our income taxes, see Note 10, “Income Taxes.”

Adjusted EBIT* and Adjusted EBIT margin* were $742 million and 15.3%, an increase of $31 million and 60 basis points, respectively, primarily due to an increase in Gross profit, partially offset by investment in R&D.

Adjusted net income* was $459 million, an increase of $40 million primarily due to the increase in Gross profit, partially offset by investment in R&D.

For the six months ended June 30, 2024

Operating income was $1,148 million, an increase of $19 million and 20 basis points as a percent of Total revenues. The increase was due to the following factors:

• Gross profit increased $73 million or 90 basis points as a percent of Total revenues primarily due to a reduction in Cost of products sold. Cost of products sold decreased $109 million or 80 basis points as a percent of Sales of products. The decrease as a percent of sales was driven by cost productivity and an increase in pricing of our products, partially offset by cost inflation. Cost of services sold increased $2 million but decreased 80 basis points as a percent of Sales of services. The decrease as a percent of sales was driven by cost productivity and an increase in pricing of our service offerings, partially offset by cost inflation. Included in our total cost of revenue as part of our product investment was $203 million in engineering costs for design follow-through on new product introductions and product lifecycle maintenance subsequent to the initial product launch, compared to $220 million for the prior year comparable period; and

• Total operating expenses increased $54 million due to an increase in R&D investments of $83 million, partially offset by a decrease in SG&A expense of $29 million primarily driven by cost saving initiatives, including information technology savings. As a result, R&D as a percentage of Total revenues increased by 90 basis points while SG&A as a percentage of Total revenues decreased by 20 basis points.

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*Non-GAAP Financial Measure

Net income attributable to GE HealthCare and Net income margin were $802 million and 8.5%, an increase of $12 million and 20 basis points, respectively, primarily due to the following factors:

*•*Operating income increased $19 million, as discussed above;

• Interest and other financial charges – net decreased $19 million primarily driven by lower overall borrowings due to the repayments made on the Term Loan Facility;

• Non-operating benefit income decreased $34 million primarily related to lower amortization of net gains on our pension plans;

• Other income (expense) – net decreased $30 million primarily related to lower net financing and investment income and non-repeat derivatives gains in the prior year; and

• Provision for income taxes decreased $33 million primarily due to prior year results impacted by an incremental charge for the accrual of withholding and other foreign taxes due upon future distribution of earnings. For additional detail regarding our income taxes, see Note 10, “Income Taxes.”

Adjusted EBIT* and Adjusted EBIT margin* were $1,423 million and 15.0%, an increase of $48 million and 60 basis points, respectively, primarily due to an increase in Gross profit, partially offset by investment in R&D.

Adjusted net income* was $872 million, an increase of $65 million primarily due to an increase in Gross profit and the decrease of Interest and other financial charges – net, partially offset by investment in R&D.

RESULTS OF OPERATIONS – SEGMENTS

We exclude from Segment EBIT certain corporate-related expenses and certain transactions or adjustments that our Chief Operating Decision Maker (which is our Chief Executive Officer) considers to be non-operational, such as Interest and other financial charges – net, Benefit (provision) for income taxes, restructuring costs, acquisition and disposition-related benefits (charges), Spin-Off and separation costs, Non-operating benefit (income) costs, gain (loss) on business and asset dispositions, amortization of acquisition-related intangible assets, Net (income) loss attributable to noncontrolling interests, Income (loss) from discontinued operations, net of taxes, and investment revaluation gain (loss). See “Results of Operations” section above for discussion on segment revenue performance.

Segment EBIT			For the three months ended June 30																		For the six months ended June 30
			2024			% of segment revenues			2023			% of segment revenues			% change						2024			% of segment revenues			2023			% of segment revenues			% change
Segment EBIT(1)
Imaging			$	286		11.0		%	$	278		10.6		%	3		%				$	526		10.4		%	$	469		9.2		%	12		%
Ultrasound			178			21.6		%	191			22.8		%	(7)		%				360			21.9		%	398			23.4		%	(10)		%
PCS			78			10.1		%	84			10.9		%	(8)		%				159			10.5		%	193			12.4		%	(18)		%
PDx			200			31.2		%	152			26.8		%	31		%				378			30.5		%	307			27.3		%	23		%

(1)For additional details regarding Segment EBIT, see Note 3, “Segment Information.”

For the three months ended June 30, 2024

*•*Imaging Segment EBIT was $286 million, an increase of $8 million due to cost productivity and an increase in price, partially offset by cost inflation;

*•*Ultrasound Segment EBIT was $178 million, a decrease of $13 million primarily due to lower sales in China and cost inflation, partially offset by cost productivity;

*•*PCS Segment EBIT was $78 million, a decrease of $6 million due to product mix, with cost productivity offsetting inflation; and

*•*PDx Segment EBIT was $200 million, an increase of $48 million due to a growth in sales volume, cost productivity, and an increase in price, partially offset by cost inflation.

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*Non-GAAP Financial Measure

For the six months ended June 30, 2024

*•*Imaging Segment EBIT was $526 million, an increase of $57 million due to cost productivity and an increase in price, partially offset by cost inflation;

*•*Ultrasound Segment EBIT was $360 million, a decrease of $38 million due to cost inflation and a decrease in sales volume, particularly in China, partially offset by cost productivity;

*•*PCS Segment EBIT was $159 million, a decrease of $34 million due to cost inflation and a decrease in sales volume, partially offset by cost productivity; and

*•*PDx Segment EBIT was $378 million, an increase of $71 million due to growth in sales volume, an increase in price, and cost productivity, partially offset by cost inflation and investments.

NON-GAAP FINANCIAL MEASURES

The non-GAAP financial measures presented in this Quarterly Report on Form 10-Q are supplemental measures of our performance and our liquidity that we believe will help investors understand our financial condition, cash flows, and operating results, and assess our future prospects. When read in conjunction with our U.S. GAAP results, these non-GAAP financial measures provide a baseline for analyzing trends in our underlying businesses and can be used by management as one basis for making financial, operational, and planning decisions. Descriptions of the reported non-GAAP measures are included below.

We report Organic revenue and Organic revenue growth rate to provide management and investors with additional understanding and visibility into the underlying revenue trends of our established, ongoing operations, as well as provide insights into overall demand for our products and services. To calculate these measures, we exclude the effect of acquisitions, dispositions, and foreign currency rate fluctuations.

We report EBIT, Adjusted EBIT, Adjusted EBIT margin, Adjusted net income, and Adjusted earnings per share to provide management and investors with additional understanding of our business by highlighting the results from ongoing operations and the underlying profitability factors, on a normalized basis. To calculate these measures we exclude, and reflect in the detailed reconciliations below, the following adjustments as applicable: Interest and other financial charges - net, Net (income) loss attributable to noncontrolling interests, Non-operating benefit (income) costs, Benefit (provision) for income taxes and certain tax related adjustments, and certain non-recurring and/or non-cash items. We may from time to time consider excluding other non-recurring items to enhance comparability between periods. Adjusted EBIT margin is calculated by taking Adjusted EBIT divided by Total revenues for the same period.

We report Adjusted tax expense and Adjusted ETR to provide investors with a better understanding of the normalized tax rate applicable to our business and provide more consistent comparability across periods. Adjusted tax expense excludes the income tax related to the pre-tax income adjustments included as part of Adjusted net income and certain income tax adjustments, such as adjustments to deferred tax assets or liabilities. We may from time to time consider excluding other non-recurring tax items to enhance comparability between periods. Adjusted ETR is Adjusted tax expense divided by Income before income taxes less the pre-tax income adjustments referenced above.

We report Free cash flow to provide management and investors with an important measure of our ability to generate cash on a normalized basis and provide insight into our flexibility to allocate capital. Free cash flow is Cash from (used for) operating activities including cash flows related to the additions and dispositions of property, plant, and equipment (“PP&E”) and additions of internal-use software. Free cash flow does not represent residual cash flows available for discretionary expenditures, due to the fact that the measure does not deduct the capital required for debt repayments.

Management recognizes that these non-GAAP financial measures have limitations, including that they may be calculated differently by other companies or may be used under different circumstances or for different purposes. In order to compensate for the discussed limitations, management does not consider these measures in isolation from or as alternatives to the comparable financial measures determined in accordance with U.S. GAAP. The detailed reconciliations of each non-GAAP financial measure to the most directly comparable U.S. GAAP financial measure are provided below, and no single financial measure should be relied on to evaluate our business.

Organic Revenue*			For the three months ended June 30												For the six months ended June 30
			2024			2023			% change						2024			2023			% change
Imaging revenues			$	2,596		$	2,620		(1)%						$	5,062		$	5,116		(1)%
Less: Acquisitions(1)			13			—									13			—
Less: Dispositions(2)			—			—									—			—
Less: Foreign currency exchange			(37)			—									(64)			—
Imaging Organic revenue*			$	2,620		$	2,620		—%						$	5,113		$	5,116		—%
Ultrasound revenues			$	823		$	839		(2)%						$	1,647		$	1,698		(3)%
Less: Acquisitions(1)			—			—									—			—
Less: Dispositions(2)			—			—									—			—
Less: Foreign currency exchange			(8)			—									(13)			—
Ultrasound Organic revenue*			$	831		$	839		(1)%						$	1,659		$	1,698		(2)%
PCS revenues			$	772		$	770		—%						$	1,519		$	1,551		(2)%
Less: Acquisitions(1)			—			—									—			—
Less: Dispositions(2)			—			—									—			—
Less: Foreign currency exchange			(2)			—									(4)			—
PCS Organic revenue*			$	775		$	770		1%						$	1,523		$	1,551		(2)%
PDx revenues			$	639		$	568		12%						$	1,238		$	1,126		10%
Less: Acquisitions(1)			—			—									—			—
Less: Dispositions(2)			—			—									—			—
Less: Foreign currency exchange			(7)			—									(8)			—
PDx Organic revenue*			$	646		$	568		14%						$	1,246		$	1,126		11%
Other revenues			$	9		$	20		(53)%						$	24		$	33		(27)%
Less: Acquisitions(1)			—			—									—			—
Less: Dispositions(2)			—			—									—			—
Less: Foreign currency exchange			—			—									—			—
Other Organic revenue*			$	9		$	20		(53)%						$	24		$	33		(27)%
Total revenues			$	4,839		$	4,817		—%						$	9,489		$	9,524		—%
Less: Acquisitions(1)			13			—									14			—
Less: Dispositions(2)			—			—									—			—
Less: Foreign currency exchange			(54)			—									(89)			—
Organic revenue*			$	4,881		$	4,817		1%						$	9,565		$	9,524		—%

(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.

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*Non-GAAP Financial Measure

Adjusted EBIT*			For the three months ended June 30												For the six months ended June 30
			2024			2023			% change						2024			2023			% change
Net income attributable to GE HealthCare			$	428		$	418		2%						$	802		$	790		2%
Add: Interest and other financial charges – net			131			137									254			273
Add: Non-operating benefit (income) costs			(101)			(123)									(204)			(238)
Less: Benefit (provision) for income taxes			(143)			(137)									(267)			(300)
Less: Net (income) loss attributable to noncontrolling interests			(7)			(15)									(21)			(26)
EBIT*			$	608		$	584		4%						$	1,140		$	1,151		(1)%
Add: Restructuring costs(1)			29			19									68			31
Add: Acquisition and disposition-related charges (benefits)(2)			(3)			(2)									(3)			(1)
Add: Spin-Off and separation costs(3)			67			72									126			130
Add: (Gain) loss on business and asset dispositions(4)			—			—									—			—
Add: Amortization of acquisition-related intangible assets			35			32									66			63
Add: Investment revaluation (gain) loss(5)			6			6									26			1
Adjusted EBIT*			$	742		$	711		4%						$	1,423		$	1,375		3%
Net income margin			8.9%			8.7%			20 bps						8.5%			8.3%			20 bps
Adjusted EBIT margin*			15.3%			14.8%			60 bps						15.0%			14.4%			60 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*			For the three months ended June 30												For the six months ended June 30
			2024			2023			% change						2024			2023			% change
Net income attributable to GE HealthCare			$	428		$	418		2%						$	802		$	790		2%
Add: Non-operating benefit (income) costs			(101)			(123)									(204)			(238)
Add: Restructuring costs(1)			29			19									68			31
Add: Acquisition and disposition-related charges (benefits)(2)			(3)			(2)									(3)			(1)
Add: Spin-Off and separation costs(3)			67			72									126			130
Add: (Gain) loss on business and asset dispositions(4)			—			—									—			—
Add: Amortization of acquisition-related intangible assets			35			32									66			63
Add: Investment revaluation (gain) loss(5)			6			6									26			1
Add: Tax effect of reconciling items			(1)			(3)									(10)			1
Add: Certain tax adjustments(6)			—			—									—			30
Adjusted net income*			$	459		$	419		10%						$	872		$	807		8%

(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)			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 and the impact of adjusting deferred tax assets and liabilities to stand-alone GE HealthCare tax rates.

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*Non-GAAP Financial Measure

Adjusted Earnings Per Share*			For the three months ended June 30												For the six months ended June 30
(In dollars, except shares outstanding presented in millions)			2024			2023			$ change						2024			2023			$ change
Diluted earnings per share			$	0.93		$	0.91		$	0.02					$	1.75		$	1.33		$	0.42
Add: Deemed preferred stock dividend of redeemable noncontrolling interest			—			—									—			0.40
Add: Non-operating benefit (income) costs			(0.22)			(0.27)									(0.44)			(0.52)
Add: Restructuring costs(1)			0.06			0.04									0.15			0.07
Add: Acquisition and disposition-related charges (benefits)(2)			(0.01)			(0.00)									(0.01)			(0.00)
Add: Spin-Off and separation costs(3)			0.15			0.16									0.28			0.28
Add: (Gain) loss on business and asset dispositions(4)			—			—									—			—
Add: Amortization of acquisition-related intangible assets			0.08			0.07									0.14			0.14
Add: Investment revaluation (gain) loss(5)			0.01			0.01									0.06			0.00
Add: Tax effect of reconciling items			(0.00)			(0.01)									(0.02)			0.00
Add: Certain tax adjustments(6)			—			—									—			0.07
Adjusted earnings per share*			$	1.00		$	0.92		$	0.09					$	1.90		$	1.76		$	0.14
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)			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 and the impact of adjusting deferred tax assets and liabilities to stand-alone GE HealthCare tax rates.

Adjusted Tax Expense and Adjusted ETR**			For the three months ended June 30									For the six months ended June 30
			2024			2023						2024			2023
Benefit (provision) for income taxes			$	(143)		$	(137)					$	(267)		$	(300)
Add: Tax effect of reconciling items			(1)			(3)						(10)			1
Add: Certain tax adjustments(1)			—			—						—			30
Adjusted tax expense*			$	(144)		$	(140)					$	(277)		$	(269)
Effective tax rate			24.7%			24.0%						24.5%			26.9%
Adjusted effective tax rate*			23.6%			24.4%						23.7%			24.4%

(1)			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 and the impact of adjusting deferred tax assets and liabilities to stand-alone GE HealthCare tax rates.

Free Cash Flow*			For the six months ended June 30
			2024			2023						% change
Cash from (used for) operating activities			$	300		$	401					(25)%
Add: Additions to PP&E and internal-use software			(209)			(213)
Add: Dispositions of PP&E			—			1
Free cash flow*			$	92		$	189					(51)%

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*Non-GAAP Financial Measure

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2024, our Cash, cash equivalents, and restricted cash balance in the Condensed Consolidated Statements of Financial Position was $2,015 million. We have historically generated positive cash flows from operating activities. Additionally, we have access to revolving credit facilities of $3,500 million in aggregate, described in detail in Note 8, “Borrowings.”

We believe that our existing balance of Cash, cash equivalents, and restricted cash, future cash generated from operating activities, access to capital markets, and existing credit facilities will be sufficient to meet the needs of our current and ongoing operations, pay taxes due, service our existing debt, and fund investments in our business for at least the next 12 months.

The following table summarizes our cash flows for the periods presented:

Cash Flow			For the six months ended June 30
			2024			2023
Cash from (used for) operating activities			$	300		$	401
Cash from (used for) investing activities			(537)			(350)
Cash from (used for) financing activities			(210)			446
Free cash flow*			92			189

Operating Activities

Cash generated from operating activities in the six months ended June 30, 2024 was $300 million and included Net income of $823 million, non-cash charges primarily for depreciation and amortization of $297 million, and $820 million in outflows from incremental changes in assets and liabilities, primarily driven by compensation and benefit payments, company-funded benefit payments for postretirement benefit plans, and an increase in inventories mainly due to inventory build to meet higher demand in the second half of the year.

Cash generated from operating activities in the six months ended June 30, 2023 was $401 million and included Net income of $816 million, non-cash charges primarily for depreciation and amortization of $313 million, and $728 million in outflows from incremental changes in assets and liabilities, primarily driven by company funded benefit payments for postretirement benefit plans, an increase in inventories mainly due to inventory build to meet higher demand in the second half of the year, and compensation and benefit payments.

Investing Activities

Cash used for investing activities in the six months ended June 30, 2024 was $537 million and primarily included purchases of businesses, net of cash acquired, of $259 million related to MIM Software Inc. (“MIM Software”), and additions to PP&E of $209 million related mostly to manufacturing capacity expansion and new product introductions. Refer to Note 7, “Acquisitions, Goodwill, and Other Intangible Assets” for additional information on the MIM Software acquisition.

Cash used for investing activities in the six months ended June 30, 2023 was $350 million and primarily included additions to PP&E of $213 million related mostly to new product introductions, manufacturing capacity expansion, and purchases of businesses, net of cash acquired, of $147 million primarily related to Caption Health, Inc.

Financing Activities

Cash used for financing activities in the six months ended June 30, 2024 was $210 million and primarily included a repayment of $150 million of our outstanding Term Loan Facility.

Cash generated from financing activities in the six months ended June 30, 2023 was $446 million and primarily included $2,000 million of newly issued debt, partially offset by $1,317 million of transfers to GE, and $211 million of Redemption of noncontrolling interests.

Free cash flow*

Free cash flow* was $92 million for the six months ended June 30, 2024 and primarily included $300 million of cash generated from operating activities, partially offset by $209 million of cash used for additions to PP&E.

Free cash flow* was $189 million for the six months ended June 30, 2023 and primarily included $401 million of cash generated from operating activities, partially offset by $213 million of cash used for additions to PP&E.

Capital Expenditures

Cash used for capital expenditures was $209 million and $213 million for the six months ended June 30, 2024 and 2023, respectively. Capital expenditures were primarily for manufacturing capacity expansion, new product introductions, and equipment and tooling for new and existing products.

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*Non-GAAP Financial Measure

Material Cash Requirements

In the normal course of business, we enter into contracts and commitments that obligate us to make payments in the future. Information regarding our obligations under lease, debt, and other commitments are provided in Note 7, “Leases,” Note 9, “Borrowings,” and Note 14, “Commitments, Guarantees, Product Warranties, and Other Loss Contingencies” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. We have material cash requirements related to our pension obligations as described in Note 9, “Postretirement Benefit Plans.” Additionally, on April 1, 2024, we funded the acquisition of MIM Software with cash on hand. Further information regarding this acquisition is provided in Note 7, “Acquisitions, Goodwill, and Other Intangible Assets.”

Debt and Credit Facilities

As part of our capital structure, we have incurred debt. The servicing of this debt is supported by cash flows from our operations. As of June 30, 2024, we had $9,240 million of total debt compared to $9,442 million as of December 31, 2023. The decrease in debt was mainly driven by a repayment of $150 million of the outstanding Term Loan Facility in the first quarter of 2024. As of June 30, 2024, there were $1,000 million of senior notes due in November 2024 recognized within Short-term borrowings in our Condensed Consolidated Statements of Financial Position.

The weighted average interest rate for the Notes and our Credit Facilities for the six months ended June 30, 2024 was 6.08%. We had no principal debt repayments on the Notes for the six months ended June 30, 2024.

In addition to the Term Loan Facility, our credit facilities include a five-year senior unsecured revolving facility that provides borrowings of up to $2,500 million expiring in January 2028, and a 364-day senior unsecured revolving facility that provides borrowings of up to $1,000 million expiring in December 2024. As of June 30, 2024, there were no outstanding borrowings on either of the two revolving facilities.

The Credit Facilities include various customary covenants that limit, among other things, the incurrence of liens securing debt, the entry into certain fundamental change transactions by GE HealthCare, and the maximum permitted leverage ratio. As of June 30, 2024, we were in compliance with the covenant requirements, including the maximum consolidated net leverage ratio.

For additional details on debt and credit facilities, see Note 8, “Borrowings.”

Access to Capital and Credit Ratings

In connection with the Spin-Off, we accessed the capital markets and raised $10,250 million of debt by issuing $8,250 million of senior unsecured notes in November 2022, and completed a drawdown of the Term Loan Facility of $2,000 million in January 2023. In addition, we arranged $3,500 million of revolving credit facilities to further support our liquidity needs. We plan to continue to rely on capital markets, and we expect to have access to credit facilities to fund our operations. The cost and availability of debt financing will be influenced by our credit ratings and market conditions. Moody’s Investors Service (“Moody’s”), Standard and Poor’s Global Ratings (“S&P”), and Fitch Ratings (“Fitch”) currently issue ratings on our long-term debt. Our credit ratings as of July 24, 2024 are set forth in the table below.

			Moody’s			S&P			Fitch
Long-term rating			Baa2			BBB			BBB
Outlook			Stable			Stable			Stable

We are disclosing our credit ratings to enhance the understanding of our sources of liquidity and the effects of our ratings on our costs of funds and access to liquidity. Our ratings may be subject to a revision or withdrawal at any time by the assigning rating organization, and each rating should be evaluated independently of any other rating.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

For a discussion of recently issued accounting standards, see Note 1, “Organization and Basis of Presentation.”

CRITICAL ACCOUNTING ESTIMATES

Management believes that there have been no significant changes during the six months ended June 30, 2024 to the items that we disclosed as our critical accounting estimates in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.