Stryker (SYK) 10-K risk factor changes: FY2023 vs FY2022

[added: Words that] identify forward-looking statements include, without limitation, words such as "may," "could," "will," "should," "possible," "plan," "predict," "forecast," "potential," "anticipate," "estimate," "expect," "project," "intend," "believe," "may impact," "on track," "goal," "strategy" and words and terms of similar substance used in connection with any discussion of future operating or financial performance, an acquisition or our businesses.

In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances, including any [removed: underlying assumptions, are forward-looking statements.]

Some important factors that could cause our actual results to differ from our expectations in any forward-looking statements [removed: include the risks discussed below.][added: include:]

We [added: expressly] disclaim any intention or obligation to publicly update or revise any forward-looking statement to reflect any change in our expectations or in events, conditions or circumstances on which those expectations may be based, or that affect the likelihood that actual results will differ from those contained in the forward-looking statements.

We use a variety of raw materials, components, devices and third-party services in our global supply chains, production and distribution processes; significant shortages, price increases or unavailability of third-party services [added: have in the past increased, and] could [removed: increase] [added: in the future increase,] our operating [removed: costs,] [added: costs and could] require significant capital [removed: expenditures,] [added: expenditures] or adversely impact the competitive position of our products: Our reliance on certain suppliers to secure raw materials, components and finished devices, and on certain third-party service providers, such as sterilization service providers, exposes us to product shortages and unanticipated increases in prices, whether due to inflationary pressure, regulatory changes, litigation [removed: exposure] [added: exposure, geopolitical tensions] or otherwise.

For example, [removed: certain of our products contain electronic components and] [added: in the past] we [removed: have experienced, and could continue to experience,] [added: experienced] limited product availability due to [removed: the] [added: an] electronic components shortage in certain product lines.

If [removed: the] [added: a similar] shortage [removed: persists,] [added: occurs in the future with respect to other raw materials or components,] we may not be able to obtain [removed: electronic components] [added: them] from our suppliers on a timely basis, or at all, or identify [removed: any] alternative [removed: suppliers to provide the electronic components we need to produce our products.][added: suppliers.]

If sole-source suppliers or service providers are [removed: acquired or were] unable or unwilling to deliver these materials or [removed: services,] [added: services as a result of financial difficulties, acquisition by a third party, natural disasters or otherwise,] we may not be able to manufacture or have available one or more products during such period of unavailability and our business could suffer.

In certain cases, we may not be able to establish additional or replacement suppliers for such materials or service providers for such services in a timely or cost-effective manner, [removed: largely] [added: often] as a result of FDA and other regulations that require, among other things, validation of materials, components and services prior to [added: their use in or with our products.]

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

In addition, [removed: during] [added: since] 2022 the market [added: has] experienced increasing inflationary pressures in part due to global supply chain disruptions, labor shortages and other impacts following the COVID-19 pandemic.

[removed: Inflation in the United States and in many of the countries where we conduct business has resulted in, and may] continue to result in, higher interest rates and increased capital, [added: energy,] shipping and labor costs, weakening [added: or strengthening] exchange rates against the United States Dollar and other similar effects.

We have experienced, and may continue to experience, inflationary increases in manufacturing costs and operating expenses, as well as negative impacts from weakening [added: or strengthening] exchange rates against the United States [removed: Dollar, and we may not be able to pass these cost increases on to our customers in a timely manner, which could have a material adverse impact on our profitability and results of operations.][added: Dollar.]

[removed: Inflation] [added: Inflation, higher interest rates or interest rate volatility] may also cause our customers to reduce or delay orders for our products and [removed: services, which could have a material adverse impact on our sales and results of operations.][added: services.]

We are subject to [added: pricing pressures as a result of] cost containment measures in the United States and other countries [removed: resulting in pricing pressures:] [added: and other factors:] Initiatives to limit the growth of general healthcare expenses and hospital costs are ongoing in the markets in which we do business.

This has already impacted our joint replacement and spine businesses on a national level, and our trauma and certain neurovascular products on a provincial level, and we expect further adoption of volume-based procurement provincially or nationally in China in [removed: 2023.][added: 2024.]

We operate in a highly competitive industry in which competition in the development and improvement of new and existing products is significant: The markets in which we compete are highly [removed: competitive.][added: competitive, and a significant element of our strategy is to increase revenue growth by focusing on innovation and new product development.]

New business models, products and surgical procedures are introduced on an ongoing basis and our present or future products could be rendered obsolete or uneconomical by [added: internal or external] technological [removed: advances by us,] [added: advances,] as we continue to innovate to address physician and patient needs, or by our existing competitors and new market entrants.

Our existing competitors and new market entrants may respond more quickly to [added: or integrate] new or emerging [removed: technologies,] [added: technologies such as robotics, artificial intelligence and machine learning in their product offerings,] undertake more extensive marketing campaigns, have greater access to clinical information to support ongoing product position in the market, have greater financial, marketing and other resources or be more successful in attracting potential customers, employees and strategic partners.

If we are unable to maintain these relationships due to regulatory restrictions, hospital access restrictions for non-patients or for [added: other reasons, our ability to develop, market and sell new and improved products could be adversely affected.]

Our ability to continue to market, distribute and sell our products may be at risk if the indirect channels become insolvent, choose to sell competitive products, choose to stop selling medical [removed: technology] [added: technology, fail to adhere to Stryker requirements] or are subject to new or additional government regulation.

Our global operations are subject to risks and [removed: potential costs, including] [added: costs related to, among other things,] changes in [removed: reimbursement,] [added: reimbursement;] changes in regulatory requirements (such as the [removed: implementation timeline] [added: staggered phase-in period] for [added: manufacturers to comply with] the European Union Medical Device Regulation (MDR) [removed: enacted by the European Union in May 2017 and originally effective in May 2021),] [added: through December 2028);] differing local product preferences and product [removed: requirements,] [added: requirements;] diminished protection of intellectual property in some [removed: countries,] [added: countries;] tariffs and other trade protection measures, [added: as well as increasing localization and protectionism policies in certain jurisdictions;] international trade disputes and import or export [removed: requirements,] [added: requirements;] difficulty in staffing and managing foreign [removed: operations,] [added: operations;] introduction of new internal business structures and [removed: programs,] [added: programs;] political and economic [removed: instability,] [added: instability; current or potential geopolitical conflicts,] such as the [removed: United Kingdom's exit from] [added: tensions between China and Taiwan and] the [removed: European Union (Brexit),] [added: wars in Ukraine] and [added: the Middle East, and related sanctions and other developments;] disruptions of [added: transportation, including port closures, increased border controls or border closures or reduced] transportation [added: availability,] due to military conflicts, a global pandemic of contagious diseases like COVID-19 or [removed: otherwise, such as reduced availability of transportation, port closures,] [added: otherwise;] increased [removed: border controls] [added: energy] or [removed: closures, increased] transportation [removed: costs] [added: costs; fluctuations in currency exchange rates] and [added: financial markets; and] increased security threats to our supply chain.

We may be unable to capitalize on previous or future acquisitions: In addition to internally developed products, we invest in new products and technologies through acquisitions, [removed: including our acquisition of Vocera.]

[removed: We] [added: We, our business partners or our third-party vendors] could experience a [added: material] failure [removed: of a key information technology system, process] or [removed: site or a] breach of [removed: information security, including] a [removed: cybersecurity breach or failure of one or more] key information technology [removed: systems, networks, processes, associated sites] [added: system, network, process] or [removed: service providers:] [added: site:] We rely extensively on information technology (IT) systems to conduct business.

Although we have made investments [added: and expect to continue to make investments] seeking to address these threats, including monitoring of networks and systems, [added: use of artificial intelligence,] hiring of experts, employee training and security policies for employees and third-party providers, the techniques used in these attacks change frequently and may be difficult to detect for periods of time and we may face difficulties in anticipating and implementing adequate preventative measures.

Our response to these incidents and our investments to protect our [added: product offerings and] information technology infrastructure and data may not shield us from significant losses and potential liability or prevent any future interruption or breach of our systems.

In addition, a [removed: greater] [added: significant] number of our employees working remotely has exposed us, and may continue to expose us, to greater risks related to cybersecurity and cyber-liability.

If our IT systems are damaged or cease to function properly, the networks or service providers we rely upon fail to function properly, or we or one of our third-party providers suffer a loss or disclosure of our business or stakeholder information due to any number of causes ranging from catastrophic events or power outages to improper data handling or security breaches [added: or unauthorized access] and our business continuity plans do not effectively address these failures on a timely basis, we may be exposed to reputational, competitive and business harm as well as litigation and regulatory action.

An inability to successfully manage the implementation of our new commercial global enterprise resource planning (ERP) system could adversely affect our operations and operating results: We are in the process of implementing a new commercial [removed: global] ERP system.

Any [added: material] disruptions, delays or deficiencies in the design and implementation of our new ERP system could adversely affect our ability to process orders, ship products, provide services and customer support, send invoices and track payments, fulfill contractual obligations or otherwise operate our business.

We may be unable to [removed: attract] [added: attract, develop] and retain [added: executives and] key employees: Our sales, technical and other key personnel play an integral role in the development, marketing and selling of new and existing products.

[removed: Ongoing inflationary pressures] [added: Inflationary pressures, labor demand] and [added: shortages and] other macroeconomic factors [added: have increased and] could [removed: also] [added: further] increase the cost of labor and [added: could] harm our ability to recruit, hire and retain talented employees.

[removed: In addition,] [added: Additionally,] if we are unable to maintain an inclusive culture that aligns our diverse workforce with our mission and values, [removed: this] [added: it] could adversely impact our ability to recruit, hire, develop and retain key talent.

[removed: Further, the remote or hybrid work environment that has become commonplace as a result of the COVID-19 pandemic could harm our culture and/or decrease employee engagement,] which could adversely impact our ability to recruit, hire, develop and retain a talented, competitive workforce.

We have principal manufacturing and distribution facilities in the United States in Arizona, California, Florida, Illinois, Indiana, Michigan, Minnesota, New Jersey, Puerto Rico, Tennessee, Texas, Utah, Virginia and Washington, and outside the United States in China, France, Germany, Ireland, Mexico, the Netherlands, [added: Poland,] Switzerland and Turkey.

In the event of an interruption in manufacturing, we may be unable to move quickly to alternate means of producing [added: and distributing] affected products to meet customer demand.

In the event of a significant interruption, we may experience lengthy delays in resuming production [added: or distribution] of affected products due to the need for regulatory approvals, and we may experience loss of market share, additional expense and harm to our reputation.

[added: We manage a portion of our exposure to] self-insured losses through a wholly-owned captive insurance company.

Insurance coverage limits provided by third-party insurers and/or our captive insurance company may not be sufficient to fully cover [removed: unanticipated losses.][added: certain losses we may experience.]

We have [added: as a result] experienced, and could [removed: continue to experience, delays and shortages] in the [removed: supply of components or materials and] [added: future experience,] delays [removed: in delivering] [added: in, or the suspension of,] our [removed: products that] [added: manufacturing operations, sales activities, research and product development activities, regulatory work streams, clinical development programs and other important commercial functions, which] may result in our inability to satisfy consumer demand for our products in a timely manner or at [removed: all,] [added: all and] which could harm our reputation, future sales and profitability.

underlying assumptions, are forward-looking statements.

- weakening of economic conditions, or the anticipation thereof, that could adversely affect the level of demand for our products;

- geopolitical risks, including from international conflicts and upcoming elections in the United States and other countries, which could, among other things, lead to increased market volatility;

- pricing pressures generally, including cost-containment measures that could adversely affect the price of or demand for our products;

- changes in foreign currency exchange markets;

- legislative and regulatory actions;

- unanticipated issues arising in connection with clinical studies and otherwise that affect approval of new products by the FDA and foreign regulatory agencies;

- inflationary pressures;

- increased interest rates or interest rate volatility;

- supply chain disruptions;

- changes in labor markets;

- changes in reimbursement levels from third-party payors;

- a significant increase in product liability claims;

- the ultimate total cost with respect to recall-related and other regulatory and quality matters;

- the impact of investigative and legal proceedings and compliance risks;

- resolution of tax audits;

- changes in tax laws and regulations;

- the impact of legislation to reform the healthcare system in the United States or other countries;

- costs to comply with medical device regulations;

- changes in financial markets;

- changes in our credit ratings;

- changes in the competitive environment;

- our ability to integrate and realize the anticipated benefits of acquisitions in full or at all or within the expected timeframes;

- our ability to realize anticipated cost savings;

- potential negative impacts resulting from climate change or other environmental, social and governance and sustainability related matters;

- the impact on our operations and financial results of any public health emergency and any related policies and actions by governments or other third parties;

- breaches or failures of our or our vendors’ or customers’ information technology systems or products, including by cyber-attack, data leakage, unauthorized access or theft; and

- other risks detailed in our filings with the SEC.

While we believe that the assumptions underlying such forward-looking statements are reasonable, there can be no assurance that future events or developments will not cause such statements to be inaccurate.

All forward-looking statements

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contained in this report are qualified in their entirety by this cautionary statement.

If any of the risks discussed below or other risks actually occur or continue to occur, our business, financial condition, operating results or cash flows could be materially adversely affected.

Accordingly, you should carefully consider the following risk factors, as well as other information contained in or incorporated by reference in this report.

In certain instances we have been unable to meet demand due to supply chain challenges, which has led to loss of sales.

Although the impacts have not been material to date, an inability to meet demand due to supply chain challenges in the future could materially adversely impact our reputation, the competitive position of our products and our business.

Any of the foregoing risks could have a material adverse impact on our profitability and results of operations.

Inflation in the United States and in many of the countries where we conduct business has resulted in, and may

Although we have been able to pass certain cost increases on to our customers, we have not been able to pass along all cost increases and we cannot guarantee that we will be able to do so in the future.

Words that

their use in or with our products.

other reasons, our ability to develop, market and sell new and improved products could be adversely affected.

The ongoing war between Russia and Ukraine, and the global response to it, may adversely affect our business and results of operations: The war between Russia and Ukraine has resulted in the implementation of sanctions by the United States and other governments against Russia and has caused significant volatility and disruptions to the global markets.

It is not possible to predict the short- and long-term implications of this war, which could include but are not limited to further sanctions, economic and political instability, increases in inflation rate and energy prices, supply chain challenges and adverse effects on currency exchange rates and financial markets.

In addition, the United States government reported that United States sanctions against Russia in response to the conflict could lead to an increased threat of cyberattacks against United States companies.

These increased threats could pose risks to the security of our information technology systems, networks and product offerings, as well as the confidentiality, availability and integrity of our data.

Further, if the war expands beyond Ukraine or further intensifies, it could have an adverse impact on our operations in Poland or other areas.

We are continuing to monitor the situation in Ukraine and globally as well as assess its potential impact on our business.

Although Russia does not constitute a material portion of our business, and we do not rely significantly on Russian or Ukrainian sources of supply, a significant escalation or further expansion of the war or related disruptions to the global markets could have a material adverse effect on our results of operations.

A security breach, whether of our products, of our customers’ network security and systems or of third-party hosting services, could impact the use of such products and the security of information stored therein.

We manage a portion of our exposure to

The COVID-19 pandemic has materially adversely affected, and could continue to materially adversely affect, our operations, supply chain, manufacturing, product distribution, customers and other business activities: The global COVID-19 pandemic led to severe disruptions in the market in the United States and international economies that may continue for a prolonged duration and trigger a recession or a period of economic slowdown.

In response, various governmental authorities and private enterprises implemented, and may continue to implement or reimplement, numerous measures, such as travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns.

A significant number of our customers, global suppliers, distributors and manufacturing facilities are located in regions that were affected by the pandemic and those operations have been, and could continue to be, materially affected by restrictive measures implemented in response to the pandemic.

As a result, some of our customers, distributors and indirect sales channels have at times been unable to retain employees, distribute or use our products or provide required services.

In addition, the pandemic adversely impacted the ability of certain third-party suppliers, manufacturers, distributors and customers to retain key employees and ensure the continued service and availability of skilled personnel necessary to run their complex operations.

To the extent management or other personnel of our third-party suppliers, manufacturers, distributors and customers are impacted again in significant numbers and are not available to perform their job duties, we could experience delays in, or the suspension of, our manufacturing operations, sales activities, research and product development activities, regulatory work streams, clinical development programs and other important commercial and corporate functions.

Moreover, we have observed an overall tightening and increasingly competitive labor market due to labor shortages caused in part by the COVID-19 pandemic and responsive measures, which has included increased wages offered by other employers and voluntary attrition of our employees and the employees of our third-party suppliers, manufacturers, distributors and customers.

We are not able at this time to estimate with certainty the effect of these and other unforeseen factors on our business, but the adverse impact on our business, cash flows, financial condition and results of operations has been, and could in the future be, material.

and continues to shift or as may be mandated by governmental authorities: Some of our products are particularly sensitive to reductions in elective medical procedures.

The OECD, which represents a coalition of member countries, has issued recommendations that, in some cases, would make substantial changes to numerous long-standing tax positions and principles.

These contemplated changes, to the extent adopted by OECD members and/or other countries, could increase tax uncertainty and may adversely affect our provision for income taxes.

The impact of United States healthcare reform legislation on our business remains uncertain: In 2010 the Patient Protection and Affordable Care Act (ACA) was enacted.

While the provisions of the ACA are intended to expand access to health insurance coverage and improve the quality of healthcare over time, other provisions of the legislation, including Medicare provisions aimed at decreasing costs, comparative effectiveness research, an

independent payment advisory board and pilot programs to evaluate alternative payment methodologies, are having a meaningful effect on the way healthcare is developed and delivered and could have a significant effect on our business.

There have been ongoing litigation and congressional efforts to modify or repeal all or certain provisions of the ACA.

We face uncertainties that might result from modification or repeal of any of the provisions of the ACA, including as a result of current and future executive orders and legislative actions.

We incur significant costs to comply with regulations, including the MDR, the free trade agreement between the United Kingdom and the European Union that became effective January 1, 2021, and the regulatory laws established by the National Medical Products Administration in China.

In 2013 and 2018 we

We may be exposed to additional potential product liability risks related to products designed, manufactured and marketed in response to the COVID-19 pandemic, including discretionary products and products permitted under the Emergency Use Authorization granted by the FDA.

The Collective Redress Directive will take effect in 2023 after a 24-month implementation period.

Stryker is [removed: one of the world's leading] [added: a global leader in] medical [removed: technology companies] [added: technologies] and, together with our customers, we are driven to make healthcare better.

We offer innovative products and services in [removed: Medical and Surgical,] [added: MedSurg,] Neurotechnology, Orthopaedics and Spine that help improve patient and healthcare outcomes.

Alongside our customers around the world, [removed: Stryker impacts] [added: we impact] more than [removed: 130] [added: 150] million patients annually.

The global economy [removed: is experiencing] [added: continues to experience] increased inflationary pressures in part due to global supply chain disruptions, labor shortages and other impacts of the [removed: COVID-19 pandemic and current] macroeconomic environment which we anticipate will continue.

Higher interest rates and capital costs, higher shipping costs, increased costs of [removed: labor and weakening] [added: labor, fluctuating] foreign currency exchange rates [removed: are creating] [added: and the military conflicts in Russia and Ukraine and the Middle East create] additional economic [removed: challenges.][added: challenges and uncertainties.]

These conditions may cause our customers to decrease or delay orders for our products and services, and [removed: we expect] the higher interest rates [removed: to] [added: may] impact [removed: demand] [added: deal mix] for our capital products.

In [removed: 2022] [added: 2023] we achieved reported net sales growth of [removed: 7.8%.][added: 11.1%.]

Excluding the impact of acquisitions and divestitures, sales grew [removed: 9.7%] [added: 11.5%] in constant currency.

We reported net earnings of [removed: $2,358] [added: $3,165] and net earnings per diluted share of [removed: $6.17.][added: $8.25.]

[removed: Excluding the impact] of certain items, we achieved adjusted net earnings(1) of [removed: $3,571] [added: $4,066] and adjusted net earnings per diluted share(1) of [removed: $9.34] [added: $10.60] representing growth of [removed: 2.8%.][added: 13.5%.]

We continued our capital allocation strategy by investing [removed: $2,563] [added: $390] in acquisitions and paying [removed: $1,051] [added: $1,139] in dividends to our shareholders.

[removed: Vocera] [added: Cerus] is part of our [removed: Medical] [added: Neurovascular] business within MedSurg and Neurotechnology.

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | [removed: 12] [added: 19] | | |

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

| [added: 2023 | | |] 2022 | | | 2021 | | | [removed: 2020] | | | [added: 2023] | | | 2022 | | | 2021 | | | [removed: 2020] | | | [added: 2023 vs. 2022] | | | 2022 vs. 2021 | | | [removed: 2021 vs. 2020] | | | [removed: | | |]

| Net sales | | | $ | [removed: 18,449] [added: 20,498] | | $ | [removed: 17,108] [added: 18,449] | | $ | [removed: 14,351] [added: 17,108] | | | | | 100.0 | | % | 100.0 | | % | 100.0 | | % | | | | [removed: 7.8] [added: 11.1] | | % | [removed: 19.2] [added: 7.8] | | % |

| Gross profit | | | [added: 13,058 | | |] 11,578 | | | 10,968 | | | [removed: 9,057] | | | [added: 63.7] | | | 62.8 | | | 64.1 | | | [removed: 63.1] | | | [added: 12.8] | | | 5.6 | | | [removed: 21.1 | | |]

| Research, development and engineering expenses | | | [added: 1,388 | | |] 1,454 | | | 1,235 | | | [removed: 984] | | | [added: 6.8] | | | 7.9 | | | 7.2 | | | [removed: 6.9] | | | [added: (4.5)] | | | 17.7 | | | [removed: 25.5 | | |]

| Selling, general and administrative expenses | | | [added: 7,129 | | |] 6,455 | | | 6,427 | | | [removed: 5,361] | | | [added: 34.8] | | | 35.0 | | | 37.6 | | | [removed: 37.4] | | | [added: 10.4] | | | 0.4 | | | [removed: 19.9 | | |]

| Recall charges, net | | | [added: 18 | | |] (15) | | | 103 | | | [removed: 17] | | | [added: 0.1] | | | (0.1) | | | 0.6 | | | [removed: 0.1] | | | [removed: | | |] nm | | | nm | | |

| Amortization of intangible assets | | | [added: 635 | | |] 627 | | | 619 | | | [removed: 472] | | | [added: 3.1] | | | 3.4 | | | 3.6 | | | [removed: 3.3] | | | [removed: | | |] 1.3 | | | [removed: 31.1] [added: 1.3] | | |

| Goodwill impairment | | | [removed: 216] [added: —] | | | [removed: —] [added: 216] | | | — | | | | | | [removed: 1.2] [added: —] | | | [removed: —] [added: 1.2] | | | — | | | | | | nm | | | nm | | |

| Other income (expense), net | | | [added: (215) | | |] (158) | | | (303) | | | [removed: (269)] | | | [added: (1.0)] | | | (0.9) | | | (1.8) | | | [removed: (1.9)] | | | [added: 36.1] | | | (47.9) | | | [removed: 12.6 | | |]

| Income taxes | | | [removed: 325] [added: 508] | | | [removed: 287] [added: 325] | | | [removed: 355] [added: 287] | | | | | | nm | | | nm | | | nm | | | | | | [removed: 13.2] [added: 56.3] | | | [removed: (19.2)] [added: 13.2] | | |

| Net earnings | | | $ | [removed: 2,358] [added: 3,165] | | $ | [removed: 1,994] [added: 2,358] | | $ | [removed: 1,599] [added: 1,994] | | | | | [removed: 12.8] [added: 15.4] | | % | [removed: 11.7] [added: 12.8] | | % | [removed: 11.1] [added: 11.7] | | % | | | | [removed: 18.3] [added: 34.2] | | % | [removed: 24.7] [added: 18.3] | | % |

| Net earnings per diluted share | | | $ | [removed: 6.17] [added: 8.25] | | $ | [removed: 5.21] [added: 6.17] | | $ | [removed: 4.20] [added: 5.21] | | | | | | | | | | | | | | | | | [removed: 18.4] [added: 33.7] | | % | [removed: 24.0] [added: 18.4] | | % |

| Adjusted net earnings per diluted share(1) | | | $ | [removed: 9.34] [added: 10.60] | | $ | [removed: 9.09] [added: 9.34] | | $ | [removed: 7.43] [added: 9.09] | | | | | | | | | | | | | | | | | [removed: 2.8] [added: 13.5] | | % | [removed: 22.3] [added: 2.8] | | % |

| | | | | | | | | | | | | [removed: 2022] [added: 2023] vs. [removed: 2021] [added: 2022] | | | | | | | | | [removed: 2021] [added: 2022] vs. [removed: 2020] [added: 2021] | | | | | | | | |

| | | | [removed: 2022] [added: 2023] | | | [removed: 2021] [added: 2022] | | | [removed: 2020] [added: 2021] | | | | | | As Reported | | | Constant Currency | | | | | | As Reported | | | Constant Currency | | |

| United States | | | $ | [removed: 13,638] [added: 15,257] | | $ | [removed: 12,321] [added: 13,638] | | $ | [removed: 10,455] [added: 12,321] | | | | | [removed: 10.7] [added: 11.9] | | % | [removed: 10.7] [added: 11.9] | | % | | | | [removed: 17.9] [added: 10.7] | | % | [removed: 17.9] [added: 10.7] | | % |

| International | | | [removed: 4,811] [added: 5,241] | | | [removed: 4,787] [added: 4,811] | | | [removed: 3,896] [added: 4,787] | | | | | | [removed: 0.5] [added: 8.9] | | | [removed: 11.7] [added: 10.9] | | | | | | [removed: 22.8] [added: 0.5] | | | [removed: 18.8] [added: 11.7] | | |

| Total | | | $ | [removed: 18,449] [added: 20,498] | | $ | [removed: 17,108] [added: 18,449] | | $ | [removed: 14,351] [added: 17,108] | | | | | [removed: 7.8] [added: 11.1] | | % | [removed: 11.0] [added: 11.6] | | % | | | | [removed: 19.2] [added: 7.8] | | % | [removed: 18.1] [added: 11.0] | | % |

| MedSurg and Neurotechnology | | | $ | [removed: 10,611] [added: 11,836] | | $ | [removed: 9,538] [added: 10,611] | | $ | [removed: 8,345] [added: 9,538] | | | | | [removed: 11.2] [added: 11.5] | | % | [removed: 14.1] [added: 12.1] | | % | | | | [removed: 14.3] [added: 11.2] | | % | [removed: 13.3] [added: 14.1] | | % |

| Orthopaedics and Spine | | | [removed: 7,838] [added: 8,662] | | | [removed: 7,570] [added: 7,838] | | | [removed: 6,006] [added: 7,570] | | | | | | [removed: 3.5] [added: 10.5] | | | [removed: 7.0] [added: 11.1] | | | | | | [removed: 26.0] [added: 3.5] | | | [removed: 24.8] [added: 7.0] | | |

| | | | | | | | | | | | | | | | [removed: 2022] [added: 2023] vs. [removed: 2021] [added: 2022] | | | | | | | | | | | | | | | | | | [removed: 2021] [added: 2022] vs. [removed: 2020] [added: 2021] | | | | | | | | | | | | | | |

| | | | [removed: 2022] [added: 2023] | | | [removed: 2021] [added: 2022] | | | [removed: 2020] [added: 2021] | | | | | | As Reported | | | Constant Currency | | | As Reported | | | As Reported | | | Constant Currency | | | | | | As Reported | | | Constant Currency | | | As Reported | | | As Reported | | | Constant Currency | | |

| Instruments | | | $ | [removed: 2,279] [added: 2,569] | | $ | [removed: 2,111] [added: 2,279] | | $ | [removed: 1,863] [added: 2,111] | | | | | [removed: 8.0] [added: 12.7] | | % | [removed: 10.4] [added: 13.0] | | % | [removed: 10.6] [added: 13.3] | | % | [removed: (0.9)] [added: 10.4] | | % | [removed: 10.0] [added: 11.8] | | % | | | | [removed: 13.4] [added: 8.0] | | % | [removed: 12.5] [added: 10.4] | | % | [removed: 11.3] [added: 10.6] | | % | [removed: 20.9] [added: (0.9)] | | % | [removed: 16.6] [added: 10.0] | | % |

| Medical | | | [removed: 3,031] [added: 3,459] | | | [removed: 2,607] [added: 3,031] | | | [removed: 2,524] [added: 2,607] | | | | | | [removed: 16.2] [added: 14.1] | | | [removed: 18.6] [added: 14.4] | | | [removed: 20.6] [added: 15.0] | | | [removed: 1.5] [added: 10.8] | | | [removed: 11.7] [added: 12.3] | | | | | | [removed: 3.3] [added: 16.2] | | | [removed: 2.2] [added: 18.6] | | | [removed: 5.1] [added: 20.6] | | | [removed: (2.4)] [added: 1.5] | | | [removed: (6.6)] [added: 11.7] | | |

| Neurovascular | | | [removed: 1,200] [added: 1,226] | | | [removed: 1,188] [added: 1,200] | | | [removed: 973] [added: 1,188] | | | | | | [removed: 1.1] [added: 2.1] | | | [removed: 7.2] [added: 4.0] | | | [removed: (0.9)] [added: 8.1] | | | [removed: 2.3] [added: (1.4)] | | | [removed: 12.2] [added: 1.5] | | | | | | [removed: 22.0] [added: 1.1] | | | [removed: 19.5] [added: 7.2] | | | [removed: 18.3] [added: (0.9)] | | | [removed: 24.4] [added: 2.3] | | | [removed: 20.3] [added: 12.2] | | |

| Neuro Cranial | | | [removed: 1,376] [added: 1,549] | | | [removed: 1,214] [added: 1,376] | | | [removed: 972] [added: 1,214] | | | | | | [removed: 13.3] [added: 12.6] | | | [removed: 15.4] [added: 13.0] | | | [removed: 14.9] [added: 11.9] | | | [removed: 6.1] [added: 16.1] | | | [removed: 17.5] [added: 18.4] | | | | | | [removed: 24.9] [added: 13.3] | | | [removed: 24.3] [added: 15.4] | | | [removed: 23.4] [added: 14.9] | | | [removed: 32.4] [added: 6.1] | | | [removed: 28.6] [added: 17.5] | | |

Overview of 2023

In May 2023 we acquired Cerus for net cash consideration of $289 and up to $225 in future milestone payments.

Cerus designs, develops and manufactures neurovascular products used for the treatment of hemorrhagic stroke.

During 2023 we made payments of $850 to extinguish the remaining balance on the $1.5 billion term loan scheduled to mature February 22, 2025.

In August 2023 we issued €500 of floating rate senior notes due November 16, 2024.

The notes bear interest at a rate based on the three-month Euro Interbank Offered Rate (EURIBOR) plus 0.3%.

The notes are callable at February 16, 2024, May 16, 2024 or October 16, 2024 either by us or at the option of the notes holders.

In November 2023 we repaid the outstanding €550 principal amount of 1.125% senior unsecured notes due November 30, 2023 and in December 2023 we repaid the outstanding $600 principal amount of 0.600% senior unsecured notes due December 1, 2023.

We subsequently issued $600 of 4.850% senior unsecured notes due December 8, 2028 and €600 of 3.375% senior unsecured notes due December 11, 2028.

| | | | | | | | | |

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| Total | | | $ | 20,498 | | $ | 18,449 | | $ | 17,108 | | | | | 11.1 | | % | 11.6 | | % | | | | 7.8 | | % | 11.0 | | % |

| Endoscopy | | | 3,033 | | | 2,725 | | | 2,418 | | | | | | 11.3 | | | 11.7 | | | 12.1 | | | 7.6 | | | 9.9 | | | | | | 12.7 | | | 15.2 | | | 13.8 | | | 8.3 | | | 20.9 | | |

| | | | $ | 8,662 | | $ | 7,838 | | $ | 7,570 | | | | | 10.5 | | % | 11.1 | | % | 10.2 | | % | 11.2 | | % | 13.0 | | % | | | | 3.5 | | % | 7.0 | | % | 6.0 | | % | (2.2) | | % | 9.3 | | % |

Note: Beginning in the first quarter 2023 we consolidated Other MedSurg and Neurotechnology into Endoscopy as Other MedSurg and Neurotechnology (primarily Sustainability Solutions) has been fully integrated into our Endoscopy business.

Endoscopy includes sales related to Other of $343, $302 and $277 for 2023, 2022 and 2021.

We have reflected these changes in all historical periods presented.

Consolidated net sales in 2023 increased 11.1% as reported and 11.6% in constant currency, as foreign currency exchange rates negatively impacted net sales by 0.5%.

Gross profit was $13,058, $11,578 and $10,968 in 2023, 2022, and 2021.

The key components of the change were:

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| STRYKER CORPORATION | | | | | | 2023 FORM 10-K | | |

| 2021 | | | 64.1 | | % |

| Sales pricing | | | (30) bps | | |

| Volume and mix | | | 110 bps | | |

| Manufacturing and supply chain costs | | | (360) bps | | |

| 2022 | | | 62.8 | | % |

| Sales pricing | | | 20 bps | | |

| Volume and mix | | | 100 bps | | |

| Manufacturing and supply chain costs | | | (40) bps | | |

| 2023 | | | 63.7 | | % |

Gross profit as a percentage of net sales increased to 63.7% in 2023 from 62.8% in 2022 due to higher sales pricing and favorable volume offset by higher manufacturing and supply chain costs primarily due to higher raw material costs in the first six months of 2023 and supply chain inefficiencies.

While segment mix was not a significant driver of the change in gross profit as a percent of net sales between 2023, 2022 and 2021, we generally expect segment mix to have an unfavorable impact for the foreseeable future as we anticipate more rapid sales growth in our lower gross margin MedSurg and Neurotechnology segment than our Orthopaedics and Spine segment.

Research, development and engineering expenses as a percentage of net sales in 2023 decreased to 6.8% from 7.9% in 2022 primarily due to increased spending for product launches, the write-off of certain intangible assets and higher spend related to medical device regulations in the European Union in 2022.

Research, development and engineering expenses as a percentage of net sales in 2022 increased to 7.9% from 7.2% in 2021 primarily due to increased spending for product launches, the write-off of certain intangible assets and higher spend related to the new medical device regulations in the European Union in 2022.

Selling, general and administrative expenses as a percentage of net sales in 2023 decreased to 34.8% from 35.0% in 2022 primarily due to charges of $132 related to share-based awards for Vocera employees that vested upon our acquisition in 2022, partially offset by disciplined increases in spend and investments in 2023 to support our growth, including sales growth incentives and increased spend on travel and meetings.

In 2022 we determined that

certain commercial and regulatory milestones related to technology acquired in the purchase of Mobius Imaging and Cardan Robotics were no longer probable of being achieved and recorded $110 to reduce the fair value of contingent consideration.

These amounts include amortization related to intangible assets acquired in the second quarter 2023 from Cerus and in the first quarter 2022 from Vocera.

Our operations have been adversely impacted by the inflationary pressures primarily related to labor, steel and transportation costs as well as the impact of purchasing electronic components at premium prices on the spot market.

Sales growth in certain products has been constrained by the continuing supply chain challenges and electronic component shortages, especially impacting the capital products in our MedSurg businesses, although the supply chain constraints eased somewhat in the fourth quarter.

Russia and Ukraine Conflict

The military conflict in Russia and Ukraine and the sanctions imposed by the United States government and other nations in response to this conflict have caused significant volatility and disruptions to the global markets.

Given that we provide life-saving and life-enhancing products, we plan to continue operating in Russia provided we can safely do so.

In 2022 net sales in Russia were approximately 0.3% of our revenues.

Although Russia does not constitute a material portion of our business, there is uncertainty around the impact it will have on the global economy, supply chains and fuel and energy prices generally, and therefore our business.

China Volume-Based Procurement and Import Purchase Evaluation

The government in China has launched regional and national programs for volume-based procurement (VBP) of high-value medical consumables to reduce healthcare costs.

Each VBP program has specific requirements to award contracts to the lowest bidders who are able to satisfy the quality and quantity requirements.

The successful bidders may be guaranteed sales volume for certain products, while unsuccessful bidders may lose unit sales volume.

We have been a winning bidder in certain national and regional VBP programs, including those for joint

replacement and trauma products in 2021 and certain neurovascular products in the fourth quarter of 2022.

The prices required for a successful bid have negatively impacted the commercial operations of joint replacement, trauma and certain neurovascular products in China.

We were unsuccessful in our bids in the VBP program for spine products that took place in the third quarter of 2022 and as a result we are exiting the spine business in China.

To date our other businesses have not been significantly impacted, but may be in the future as a result of additional VBP programs.

China has also issued national guiding standards for Import Purchase Evaluation (IPE) which has increased the purchase of locally sourced equipment in China's public hospitals and is impacting our MedSurg business in China.

Our business in China represented approximately 2.4% our revenues in 2022.

Overview of 2022

In February 2022 we entered into a $1.5 billion term loan agreement that matures on February 22, 2025 and bears interest at a base rate based on the Term Secured Overnight Financing Rate (SOFR) plus 0.725%.

In 2022 we repaid $650 of this term loan.

Refer to Note 10 to our Consolidated Financial Statements for further information.

In February 2022 we completed the acquisition of Vocera for $79.25 per share, or an aggregate purchase price of $2.6 billion, net of cash acquired ($3.0 billion including convertible notes).

Vocera is a leader in the digital care coordination and communication category.

Goodwill attributable to the acquisition reflects the strategic benefits of expanding our presence in adjacent markets, diversifying our product portfolio, advancing innovations, and accelerating our digital aspirations.

In 2022 we recorded a goodwill impairment charge of $216 related to our Spine business.

Refer to Note 8 to our Consolidated Financial Statements for further information.

On August 16, 2022 the Inflation Reduction Act (IRA) was enacted into law.

The IRA includes a 15% corporate alternative minimum tax effective in 2023 and a 1% tax on share repurchases after December 31, 2022.

We do not expect the tax-related provisions of the IRA to have a material impact on our Consolidated Financial Statements.

The impact of the excise tax on share repurchases will be dependent on the extent of share repurchases made in future periods.

| Endoscopy | | | 2,423 | | | 2,141 | | | 1,763 | | | | | | 13.2 | | | 15.9 | | | 14.6 | | | 8.2 | | | 20.8 | | | | | | 21.5 | | | 20.8 | | | 18.6 | | | 32.7 | | | 29.4 | | |

| Other | | | 302 | | | 277 | | | 250 | | | | | | 9.2 | | | 9.3 | | | 8.9 | | | 25.3 | | | 29.9 | | | | | | 10.4 | | | 10.3 | | | 10.0 | | | 48.9 | | | 40.8 | | |

| | | | $ | 7,838 | | $ | 7,570 | | $ | 6,006 | | | | | 3.5 | | % | 7.0 | | % | 6.0 | | % | (2.2) | | % | 9.3 | | % | | | | 26.0 | | % | 24.8 | | % | 25.0 | | % | 28.6 | | % | 24.5 | | % |

Consolidated net sales in 2021 increased 19.2% as reported and 18.1% in constant currency.

Gross profit as a percentage of net sales decreased to 62.8% in 2022 from 64.1% in 2021.

Gross profit as a percentage of net sales increased to 64.1% in 2021 from 63.1% in 2020.

Excluding the impact of the items noted below, gross profit increased to 65.9% from 63.8% in 2020 primarily due to leverage from higher sales volumes and favorable product mix, partially offset by lower selling prices.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

Our operating results are primarily exposed to changes in exchange rates among the United States Dollar, Australian Dollar, British Pound, Canadian Dollar, [removed: Chinese Yuan,] Euro and Japanese Yen.

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | [removed: 19] [added: 22] | | |

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

[added: We develop and manufacture products in the United States, Canada, China,] Costa Rica, France, Germany, India, Ireland, Mexico, Switzerland, Turkey and [added: the] United Kingdom and incur costs in the applicable local currencies.

A hypothetical 10% change in foreign currencies relative to the United States Dollar would change the December 31, [removed: 2022] [added: 2023] fair value of these instruments by approximately [removed: $388.][added: $389.]

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

We develop and manufacture products in the United States, Canada, China,

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | 20 | | |

Stryker Corporation (Stryker or the Company) is [removed: one of the world's leading] [added: a global leader in] medical [removed: technology companies] [added: technologies] and, together with our customers, we are driven to make healthcare better.

We offer innovative products and services in [removed: Medical and Surgical,] [added: MedSurg,] Neurotechnology, Orthopaedics and Spine that help improve patient and healthcare outcomes.

Alongside our customers around the world, [removed: Stryker impacts] [added: we impact] more than [removed: 130] [added: 150] million patients annually.

[removed: ][added: ]

Our products are sold in [removed: over] [added: approximately] 75 countries through company-owned subsidiaries and branches as well as third-party dealers and distributors, and include surgical equipment and surgical navigation systems; endoscopic and communications systems; patient handling, emergency medical equipment and intensive care disposable products; clinical communication and workflow solutions; neurosurgical and neurovascular devices; implants used in joint replacement and trauma surgeries; Mako Robotic-Arm Assisted technology; spinal devices; as well as other products used in a variety of medical specialties.

| | | | [removed: 2022] [added: 2023] | | | | | | | | | [removed: 2021] [added: 2022] | | | | | | | | | [removed: 2020] [added: 2021] | | | | | |

| MedSurg and Neurotechnology | | | $ | [removed: 10,611] [added: 11,836] | | 58 | | % | | | | $ | [removed: 9,538] [added: 10,611] | | [removed: 56] [added: 58] | | % | | | | $ | [removed: 8,345] [added: 9,538] | | [removed: 58] [added: 56] | | % |

| Orthopaedics and Spine | | | [removed: 7,838] [added: 8,662] | | | 42 | | | | | | [removed: 7,570] [added: 7,838] | | | [removed: 44] [added: 42] | | | | | | [removed: 6,006] [added: 7,570] | | | [removed: 42] [added: 44] | | |

| Total | | | $ | [removed: 18,449] [added: 20,498] | | 100 | | % | | | | $ | [removed: 17,108] [added: 18,449] | | 100 | | % | | | | $ | [removed: 14,351] [added: 17,108] | | 100 | | % |

MedSurg products include surgical equipment, patient and caregiver safety technologies, and navigation systems (Instruments), endoscopic and communications systems [added: and reprocessed and remanufactured medical devices] (Endoscopy), [added: and] patient handling, emergency medical equipment, intensive care disposable products and clinical communication and workflow solutions [removed: (Medical), reprocessed and remanufactured medical devices, and other medical device products used in a variety of medical specialties.][added: (Medical).]

We are one of five leading global competitors in Instruments; the other four being Zimmer Biomet Holdings, Inc. (Zimmer), Medtronic [removed: plc.,] [added: plc (Medtronic),] Johnson & Johnson and ConMed Linvatec, Inc. (a subsidiary of CONMED Corporation).

[removed: In Endoscopy we compete with] [added: We are one of seven leading global competitors in Endoscopy; the other six being] Karl Storz GmbH & Co., Olympus Optical Co. Ltd., Smith & Nephew plc (Smith & Nephew), ConMed Linvatec, Arthrex, Inc. and STERIS plc.

[removed: In Medical our primary competitors] [added: We] are [removed: Baxter/Hill-Rom,] [added: one of five leading global competitors in Medical; the other four being Baxter International] Inc., Zoll Medical Corporation, Medline Industries and Ferno-Washington, Inc. [removed: Stryker is also] [added: We are] one of five leading global competitors in Neurotechnology; the other four being Medtronic, Johnson & Johnson, Terumo Corporation and Penumbra, Inc.

| Instruments | | | $ | [removed: 2,279] [added: 2,569] | | [removed: 21] [added: 22] | | % | | | | $ | [removed: 2,111] [added: 2,279] | | [removed: 22] [added: 21] | | % | | | | $ | [removed: 1,863] [added: 2,111] | | 22 | | % |

| Medical | | | [removed: 3,031] [added: 3,459] | | | 29 | | | | | | [removed: 2,607] [added: 3,031] | | | [removed: 27] [added: 29] | | | | | | [removed: 2,524] [added: 2,607] | | | [removed: 30] [added: 27] | | |

| Neurovascular | | | [removed: 1,200] [added: 1,226] | | | [removed: 11] [added: 10] | | | | | | [removed: 1,188] [added: 1,200] | | | [removed: 13] [added: 11] | | | | | | [removed: 973] [added: 1,188] | | | [removed: 12] [added: 13] | | |

| Neuro Cranial | | | [removed: 1,376] [added: 1,549] | | | 13 | | | | | | [removed: 1,214] [added: 1,376] | | | 13 | | | | | | [removed: 972] [added: 1,214] | | | [removed: 12] [added: 13] | | |

| Total | | | $ | [removed: 10,611] [added: 11,836] | | 100 | | % | | | | $ | [removed: 9,538] [added: 10,611] | | 100 | | % | | | | $ | [removed: 8,345] [added: 9,538] | | 100 | | % |

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

We are one of [removed: five] [added: four] leading global competitors in Spine; the other [removed: four] [added: three] being Medtronic Sofamor Danek, Inc. (a subsidiary of Medtronic), [removed: DePuy Synthes, Nuvasive, Inc. and] Globus Medical, Inc. [added: (including Nuvasive) and DePuy Synthes.]

| Knees | | | $ | [removed: 1,997] [added: 2,273] | | [removed: 25] [added: 26] | | % | | | | $ | [removed: 1,848] [added: 1,997] | | 25 | | % | | | | $ | [removed: 1,567] [added: 1,848] | | [removed: 26] [added: 25] | | % |

| Hips | | | [removed: 1,413] [added: 1,544] | | | 18 | | | | | | [removed: 1,342] [added: 1,413] | | | 18 | | | | | | [removed: 1,206] [added: 1,342] | | | [removed: 20] [added: 18] | | |

| Trauma and Extremities | | | [removed: 2,807] [added: 3,147] | | | 36 | | | | | | [removed: 2,664] [added: 2,807] | | | [removed: 35] [added: 36] | | | | | | [removed: 1,722] [added: 2,664] | | | [removed: 29] [added: 35] | | |

| Spine | | | [removed: 1,146] [added: 1,189] | | | [removed: 15] [added: 14] | | | | | | [removed: 1,167] [added: 1,146] | | | 15 | | | | | | [removed: 1,047] [added: 1,167] | | | [removed: 17] [added: 15] | | |

| Other | | | [removed: 475] [added: 509] | | | 6 | | | | | | [removed: 549] [added: 475] | | | [removed: 7] [added: 6] | | | | | | [removed: 464] [added: 549] | | | [removed: 8] [added: 7] | | |

| Total | | | $ | [removed: 7,838] [added: 8,662] | | 100 | | % | | | | $ | [removed: 7,570] [added: 7,838] | | 100 | | % | | | | $ | [removed: 6,006] [added: 7,570] | | 100 | | % |

We seek to obtain patent protection on our products [added: whenever appropriate for protecting our competitive advantage.]

On December 31, [removed: 2022] [added: 2023] we owned approximately [removed: 4,800] [added: 5,200] United States patents and approximately [removed: 7,300] [added: 7,700] patents in other countries.

The development of [removed: new and] innovative products is important to our success in all areas of our business.

We are required to comply with the unique regulatory requirements of each country [removed: within] [added: in] which we market and sell our products.

In the United States the Medical Device Amendments of 1976 to the Federal Food, Drug and Cosmetic Act and its subsequent amendments and the regulations issued and proposed thereunder provide for federal regulation by the [removed: FDA] [added: United States Food and Drug Administration (FDA)] of the design, manufacture and marketing of medical devices, including most of our products.

Certain of our products require extensive clinical testing, consisting of safety and efficacy studies, followed by pre-market approval [removed: (PMA)] applications for specific surgical indications.

[removed: There are also certain requirements of] state, local and foreign governments that must be complied with in the manufacture and marketing of our products.

The European Union enacted the European Union Medical Device Regulation in May 2017 with an original effective date of May [removed: 2021 (the transition timeline is currently being reevaluated by the European Parliament),] [added: 2021,] which imposes stricter requirements for the marketing and sale of medical devices, including in the areas of clinical evaluation requirements, quality systems, labeling and post-market surveillance.

Initiatives to limit the growth of general healthcare expenses and hospital costs are ongoing in the markets [removed: in which] we do business.

On December 31, [removed: 2022] [added: 2023] we had approximately [removed: 51,000] [added: 52,000] employees globally, with approximately 27,000 employees in the United States.

Our talented employees are an integral reason for our standing as [removed: one of the world's leading] [added: a global leader in] medical [removed: technology companies] [added: technologies] where, together with our customers, we are driven to make healthcare better.

Our success [removed: is dependent] [added: depends] on our ability to attract the best [removed: talent that reflects our diverse communities.][added: talent.]

We encourage all employees to establish [removed: individual] development [removed: plans,] [added: objectives,] in partnership with their manager, to help employees gain the needed development experience to grow their careers.

[added: Listening to and] learning from our employees forms the foundation of an engaging culture.

| | | | 2023 | | | | | | | | | 2022 | | | | | | | | | 2021 | | | | | |

| Endoscopy | | | 3,033 | | | 26 | | | | | | 2,725 | | | 26 | | | | | | 2,418 | | | 25 | | |

In 2023 Instruments launched the Neptune S, which is the only constantly closed low-fluid waste management system on the market.

Instruments also saw continued momentum from the launch of the System 9 total joint power tool.

Endoscopy expanded its product offering with the launch of the 4K 1788 Camera platform that features several enhancements for a broader range of clinical applications and specialties, including urology, neurology and ear, nose and throat.

In addition, 1788 can be used to visualize indocyanine green and Cytalux.

Medical launched the Xpedition powered stair chair, designed with an integrated workflow for first responders, maintaining the same storage footprint as Stryker's Stair-PRO and enhanced user interface for ease of use.

Xpedition allows caregivers to safely and ergonomically move patients over a variety of terrains.

Neurovascular completed the acquisition of Cerus Endovascular Limited (Cerus), a leader in the design and development of neurointerventional devices for the treatment of intracranial aneurysms.

The acquisition of Cerus is highly complementary to our Neurovascular business and strengthens our hemorrhagic portfolio globally.

Neurovascular also launched the Target Tetra coil in the United States, Japan, Korea and Europe, Middle East, Africa for the treatment of small aneurysms and the Vecta 46 Intermediate Catheter in the United States, Japan and Korea.

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | 2023 | | | | | | | | | 2022 | | | | | | | | | 2021 | | | | | |

In 2023 we continued our full commercial launch of the Insignia hip stem.

Insignia received approval in Japan from the Pharmaceuticals and Medical Devices Agency and clinical cases occurred in December 2023.

With the addition of Japan, Insignia is now being used clinically in six countries worldwide (United States, Canada, Japan, New Zealand, Singapore and Hong Kong).

We also saw our first clinical use of the Triathlon Hinge revision knee system in August 2023.

The Hinge product helps restore patient mobility in challenging cases and we anticipate moving towards full commercial launch in 2024.

In 2023 we celebrated the 10th anniversary of the Triathlon Tritanium Baseplate.

Since its introduction in 2013, Triathlon Cementless, which includes the Triathlon Tritanium Baseplate, has delivered a decade of positive patient impact, demonstrated impressive survivorship data and has become a trusted solution for surgeons across the globe.

In 2023 we celebrated the 10-year anniversary of the Mako Surgical Corp. acquisition and the Mako SmartRobotics™ technology.

Over the past ten years, this groundbreaking technology has transformed the orthopaedics landscape, resulting in tremendous patient impact for surgeons and their patients.

Additionally, we reached the milestone of 1 million Mako SmartRobotics™ procedures performed globally.

There are also certain requirements of

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| STRYKER CORPORATION | | | | | | 2023 FORM 10-K | | |

Extended transition timelines were published in 2023 which range from May 2026 through December 2028 depending on the type of device and our implementation is on track to meet these timelines.

- Increasing access to talent through strategic partnerships and campaigns

- Growing and engaging talent with a range of opportunities to learn and develop

- Aligning our employee resource groups to focus on creating community and belonging

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| STRYKER CORPORATION | | | | | | 2023 FORM 10-K | | |

| As of January 31, 2024 | | | | | | | | | | | |

Our main corporate website address is *www.stryker.com.* The information on our website is not incorporated by reference into this report.

| Endoscopy | | | 2,423 | | | 23 | | | | | | 2,141 | | | 22 | | | | | | 1,763 | | | 21 | | |

| Other | | | 302 | | | 3 | | | | | | 277 | | | 3 | | | | | | 250 | | | 3 | | |

In 2022 Instruments launched the next generation of the System 9 total joint power tool and the CD NXT power tool with automatic depth measurement allowing for fast, accurate and consistent digital depth measurement across a variety of procedures.

Endoscopy expanded its product offering for the Ambulatory Surgery Center (ASC) market with the launch of a new 4K 1688 Autoclavable Camera and SDC4K image capture device.

Endoscopy also launched a new line of fluorescent capable laparoscopes to improve image quality in laparoscopic procedures.

Medical completed the acquisition of Vocera Communications, Inc. (Vocera), a leader in digital care coordination and communication.

Vocera brings a highly complementary and innovative portfolio to Medical that is expected to enhance our Advanced Digital Healthcare offerings and further advance our focus on preventing adverse events throughout the continuum of care.

In addition, Medical launched the Power Pro 2 cot, the industry’s first connected ambulance cot.

In 2022 Neurovascular launched the Vecta 71/74 aspiration system in Japan, Korea, Australia and New Zealand as well as the Cat 7 distal access catheter in China.

We also continued the launch of the next generation of the market leading Synchro guidewire in Asia Pacific.

In 2022 we moved to a full commercial launch of Insignia hip stem in the United States after first clinical use in December 2021.

United States Food and Drug Administration (FDA) approval was received in 2021, Health Canada approval was received in the fourth quarter of 2022 and Japan’s Pharmaceuticals and Medical Devices Agency (PMDA) approval is anticipated in the second half of 2023.

Where some electronic components have had limited availability due to recent global shortages, we have worked closely with suppliers to ensure this temporary supply constraint did not have a material adverse effect on continuity of supply.

whenever appropriate for protecting our competitive advantage.

Additionally, as a result of the exit of the United Kingdom from the European Union (Brexit), new medical device regulations were released by the United Kingdom, which became effective January 1, 2021.

A gap analysis against the prior Medical Device Directive (MDD) has

been completed and a plan is being executed for both the European Union and United Kingdom regulations to ensure compliance and minimize business disruption.

Listening to and

- Holding leadership accountable through transparent data, performance objectives and inclusion in our business review process

- Engaging and inspiring all talent and empowering every employee to take action

- Developing our people and processes by removing barriers and optimizing the power of diverse backgrounds, talents and perspectives

- Attracting a diverse talent pool through focused outreach and ensuring an objective hiring process

- Advancing our employee resource groups (ERGs) to expand reach through executive leadership, global presence, funding and aligned strategies

- Positively impacting our customers and communities through building and strengthening external partnerships

| As of January 31, 2023 | | | | | | | | | | | |

Prior to joining Stryker in April 2018, Mr. Menon held various senior supply chain leadership roles with Verizon Communications Inc. during the previous eight years, most recently as the Chief Supply Chain Officer.

For the fiscal year ended December 31, [removed: 2022][added: 2023]

[removed: ][added: ]

| [removed: 1.125%] [added: 3.375%] Notes due [removed: 2023] [added: 2028] | | | [removed: SYK23] [added: SYK28] | | | New York Stock Exchange | | |

Yes [removed: ☐ No] ☒ [added: No ☐]

The aggregate market value of the voting stock held by non-affiliates of the registrant was approximately [removed: $70,965,162,853] [added: $109,722,902,589] at June 30, [removed: 2022.][added: 2023.]

There were [removed: 378,831,249] [added: 380,264,036] shares outstanding of the registrant’s common stock, $0.10 par value, on January 31, [removed: 2023.][added: 2024.]

Portions of the proxy statement to be filed with the U.S. Securities and Exchange Commission relating to the [removed: 2023] [added: 2024] Annual Meeting of Shareholders (the [removed: 2023] [added: 2024] proxy statement) are incorporated by reference into Part III.

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

| Item 1. | | | Business | | | [removed: [1](#icec46013a0ad4608b89f97e433dd3417_13)] [added: [1](#i38d30d622853492b9c48a7772b24d59a_10)] | | |

| Item 1A. | | | Risk Factors | | | [removed: [4](#icec46013a0ad4608b89f97e433dd3417_16)] [added: [4](#i38d30d622853492b9c48a7772b24d59a_16)] | | |

| Item 1B. | | | Unresolved Staff Comments | | | [removed: [9](#icec46013a0ad4608b89f97e433dd3417_19)] [added: [10](#i38d30d622853492b9c48a7772b24d59a_19)] | | |

| Item 2. | | | Properties | | | [removed: [9](#icec46013a0ad4608b89f97e433dd3417_22)] [added: [11](#i38d30d622853492b9c48a7772b24d59a_22)] | | |

| Item 3. | | | Legal Proceedings | | | [removed: [10](#icec46013a0ad4608b89f97e433dd3417_25)] [added: [11](#i38d30d622853492b9c48a7772b24d59a_25)] | | |

| Item 4. | | | Mine Safety Disclosures | | | [removed: [10](#icec46013a0ad4608b89f97e433dd3417_28)] [added: [11](#i38d30d622853492b9c48a7772b24d59a_28)] | | |

| Item 5. | | | Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | | | [removed: [10](#icec46013a0ad4608b89f97e433dd3417_34)] [added: [11](#i38d30d622853492b9c48a7772b24d59a_34)] | | |

| Item 6. | | | Selected Financial Data | | | [removed: [11](#icec46013a0ad4608b89f97e433dd3417_37)] [added: [12](#i38d30d622853492b9c48a7772b24d59a_37)] | | |

| Item 7. | | | Management’s Discussion and Analysis of Financial Condition and Results of Operations | | | [removed: [12](#icec46013a0ad4608b89f97e433dd3417_40)] [added: [13](#i38d30d622853492b9c48a7772b24d59a_40)] | | |

| Item 7A. | | | Quantitative and Qualitative Disclosures About Market Risk | | | [removed: [19](#icec46013a0ad4608b89f97e433dd3417_73)] [added: [21](#i38d30d622853492b9c48a7772b24d59a_73)] | | |

| Item 8. | | | Financial Statements and Supplementary Data | | | [removed: [21](#icec46013a0ad4608b89f97e433dd3417_76)] [added: [23](#i38d30d622853492b9c48a7772b24d59a_76)] | | |

| | | | Report of Independent Registered Public Accounting Firm (PCAOB ID: 42) | | | [removed: [21](#icec46013a0ad4608b89f97e433dd3417_76)] [added: [23](#i38d30d622853492b9c48a7772b24d59a_76)] | | |

| | | | Consolidated Statements of Earnings | | | [removed: [23](#icec46013a0ad4608b89f97e433dd3417_79)] [added: [24](#i38d30d622853492b9c48a7772b24d59a_79)] | | |

| | | | Consolidated Statements of Comprehensive Income | | | [removed: [23](#icec46013a0ad4608b89f97e433dd3417_82)] [added: [24](#i38d30d622853492b9c48a7772b24d59a_85)] | | |

| | | | Consolidated Balance Sheets | | | [removed: [24](#icec46013a0ad4608b89f97e433dd3417_85)] [added: [25](#i38d30d622853492b9c48a7772b24d59a_88)] | | |

| | | | Consolidated Statements of Shareholders’ Equity | | | [removed: [25](#icec46013a0ad4608b89f97e433dd3417_91)] [added: [26](#i38d30d622853492b9c48a7772b24d59a_91)] | | |

| | | | Consolidated Statements of Cash Flows | | | [removed: [26](#icec46013a0ad4608b89f97e433dd3417_94)] [added: [27](#i38d30d622853492b9c48a7772b24d59a_94)] | | |

| | | | Notes to Consolidated Financial Statements | | | [removed: [27](#icec46013a0ad4608b89f97e433dd3417_97)] [added: [28](#i38d30d622853492b9c48a7772b24d59a_97)] | | |

| Item 9. | | | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure | | | [removed: [39](#icec46013a0ad4608b89f97e433dd3417_145)] [added: [41](#i38d30d622853492b9c48a7772b24d59a_145)] | | |

| Item 9A. | | | Controls and Procedures | | | [removed: [39](#icec46013a0ad4608b89f97e433dd3417_148)] [added: [41](#i38d30d622853492b9c48a7772b24d59a_148)] | | |

| Item 9B. | | | Other Information | | | [removed: [40](#icec46013a0ad4608b89f97e433dd3417_151)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_151)] | | |

| Item 9C. | | | Disclosure Regarding Foreign Jurisdictions That Prevent Inspections | | | [removed: [40](#icec46013a0ad4608b89f97e433dd3417_151)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_154)] | | |

| Item 10. | | | Directors, Executive Officers and Corporate Governance | | | [removed: [40](#icec46013a0ad4608b89f97e433dd3417_160)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_160)] | | |

| Item 11. | | | Executive Compensation | | | [removed: [40](#icec46013a0ad4608b89f97e433dd3417_163)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_163)] | | |

| Item 12. | | | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | | | [removed: [40](#icec46013a0ad4608b89f97e433dd3417_166)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_166)] | | |

| Item 13. | | | Certain Relationships and Related Transactions, and Director Independence | | | [removed: [41](#icec46013a0ad4608b89f97e433dd3417_169)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_169)] | | |

| Item 14. | | | Principal Accountant Fees and Services | | | [removed: [41](#icec46013a0ad4608b89f97e433dd3417_172)] [added: [42](#i38d30d622853492b9c48a7772b24d59a_172)] | | |

| Item 15. | | | Exhibits, Financial Statement Schedules | | | [removed: [42](#icec46013a0ad4608b89f97e433dd3417_178)] [added: [43](#i38d30d622853492b9c48a7772b24d59a_178)] | | |

| Item 16. | | | Form 10-K Summary | | | [removed: [45](#icec46013a0ad4608b89f97e433dd3417_184)] [added: [46](#i38d30d622853492b9c48a7772b24d59a_184)] | | |

| 1941 Stryker Way, | | | | | | Portage, | | | | | | Michigan | | | | | | 49002 | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Item 1C. | | | Cybersecurity | | | [10](#i38d30d622853492b9c48a7772b24d59a_1736) | | |

| | | | | | | | | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| STRYKER CORPORATION | | | | | | 2023 FORM 10-K | | |

| 2825 Airview Boulevard, | | | | | | Kalamazoo, | | | | | | Michigan | | | | | | 49002 | | |

RISK MANAGEMENT AND STRATEGY

We review cybersecurity risk as part of our overall enterprise risk management program.

This ensures that cybersecurity risk management remains a top priority in our business strategy and operations.

MANAGEMENT'S ROLE IN MANAGING RISK

Primary management responsibility for assessing, monitoring and managing our cybersecurity risks rests with our chief information security officer ("CISO").

Our current CISO has over 30 years of experience in information technology including over 20 years in cybersecurity and oversees a team of cybersecurity professionals with over 140 security, risk, and compliance certifications.

The CISO is regularly informed about recent developments in cybersecurity, including potential threats and innovative risk management techniques.

The CISO implements and oversees processes for the regular monitoring of our information systems.

We use various tools and methodologies to manage cybersecurity risk that are tested regularly.

We also monitor and evaluate our cybersecurity posture and performance on an ongoing basis through regular vulnerability scans, penetration tests and threat intelligence feeds.

In addition, we engage third-party consultants to conduct annual cybersecurity assessments and to conduct audits for compliance with regulatory, Sarbanes-Oxley Act, Service Organization Control Type 2 and International Organization for Standardization standards.

We also engage third parties to assess our cybersecurity maturity and risk management programs.

We use a cross-departmental approach to addressing cybersecurity risk, with our cybersecurity, product security and legal teams presenting quarterly on key topics to a committee of leaders in finance, regulatory, and corporate affairs functions.

This leadership committee meets quarterly to ensure that we have input and oversight from critical stakeholders into our cybersecurity program and evolving issues.

The CISO oversees a training and awareness program for employees to take part in protecting the Company against cybersecurity risks.

We have implemented annual mandatory security education to help employees understand cybersecurity risks and comply with our cybersecurity policies.

Additionally, we provide frequent communications around pertinent cybersecurity topics and policies to all employees.

We also provide additional cybersecurity and data protection training to employees in certain roles.

As part of our cybersecurity risk management program, we also conduct cybersecurity and privacy assessments on all third parties who integrate with Stryker’s data, network, systems and products.

We use a combination of internal and external tools to confirm that these third parties meet our security requirements.

We leverage standard industry threat model and privacy impact assessment concepts to confirm that data minimization and adequate data protections are in place.

We perform supplemental reviews as necessary, commensurate with the risk associated with each vendor.

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | 10 | | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| STRYKER CORPORATION | | | | | | 2023 FORM 10-K | | |

In the event of a cybersecurity incident, we have an incident response plan that includes immediate actions to mitigate the impact and long-term strategies for remediation and prevention of future incidents.

The cybersecurity and product security teams routinely practice this plan with functions across the organization.

We conduct tabletop exercises with senior management, during which we practice the procedures in place to ensure that potentially material cybersecurity risks and incidents are escalated to management and the Board of Directors where applicable.

GOVERNANCE

Cybersecurity risks are overseen by the full Board of Directors and the Audit Committee.

The Audit Committee is central to the Board of Directors’ oversight of cybersecurity risks and bears the primary responsibility for overseeing cybersecurity risk.

The Audit Committee actively participates in strategic decisions related to cybersecurity, offering guidance and approval for major cybersecurity initiatives.

This involvement ensures that cybersecurity considerations are integrated into our broader strategic objectives.

Our CISO provides comprehensive updates to the Audit Committee quarterly and the full Board of Directors at least annually.

These briefings include a range of topics, including:

- Current cybersecurity landscape and emerging threats;

- Status of ongoing cybersecurity initiatives and strategies;

We have approximately [removed: 27] [added: 28] company-owned and [removed: 322] [added: 294] leased locations worldwide including [removed: 48] [added: 43] manufacturing locations.

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | 9 | | |

STRYKER CORPORATION 2022 FORM 10-K

On January 31, [removed: 2023] [added: 2024] there were [removed: 2,523] [added: 2,501] shareholders of record of our common stock.

We did not repurchase any shares in the three months ended December 31, [removed: 2022] [added: 2023] and the total dollar value of shares that could be acquired under our authorized repurchase program at December 31, [removed: 2022] [added: 2023] was $1,033.

In the fourth quarter [removed: 2022] [added: 2023] we issued [removed: 48] [added: 5] shares of our common stock as performance incentive awards to employees.

The graph assumes $100 (not in millions) invested on December 31, [removed: 2017] [added: 2018] in our common stock and each of the indices.

[removed: ][added: ]

| Company / Index | | | [removed: 2017 | | |] 2018 | | | 2019 | | | 2020 | | | 2021 | | | 2022 | | | [added: 2023 | | |]

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | [removed: 10] [added: 11] | | |

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

| Stryker Corporation | | | $ | 100.00 | | $ | 135.33 | | $ | 159.91 | | $ | 176.26 | | $ | 163.19 | | $ | 202.03 | |

| S&P 500 Index | | | $ | 100.00 | | $ | 131.49 | | $ | 155.68 | | $ | 200.37 | | $ | 164.08 | | $ | 207.21 | |

| S&P 500 Health Care Index | | | $ | 100.00 | | $ | 120.82 | | $ | 137.07 | | $ | 172.89 | | $ | 169.51 | | $ | 173.00 | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Stryker Corporation | | | $ | 100.00 | | $ | 102.43 | | $ | 138.62 | | $ | 163.81 | | $ | 180.56 | | $ | 167.16 | |

| S&P 500 Index | | | $ | 100.00 | | $ | 95.62 | | $ | 125.72 | | $ | 148.85 | | $ | 191.58 | | $ | 156.88 | |

| S&P 500 Health Care Index | | | $ | 100.00 | | $ | 106.47 | | $ | 128.64 | | $ | 145.93 | | $ | 184.07 | | $ | 180.47 | |

| Statement of Earnings Data | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Net sales | | | | | | $ | [removed: 18,449] [added: 20,498] | | | | | $ | [removed: 17,108] [added: 18,449] | | | | | $ | [removed: 14,351] [added: 17,108] | | | | | $ | [removed: 14,884] [added: 14,351] | | | | | $ | [removed: 13,601] [added: 14,884] | |

| Cost of sales | | | | | | [removed: 6,871] [added: 7,440] | | | | | | [removed: 6,140] [added: 6,871] | | | | | | [removed: 5,294] [added: 6,140] | | | | | | [removed: 5,188] [added: 5,294] | | | | | | [removed: 4,663] [added: 5,188] | | |

| Gross profit | | | | | | $ | [removed: 11,578] [added: 13,058] | | | | | $ | [removed: 10,968] [added: 11,578] | | | | | $ | [removed: 9,057] [added: 10,968] | | | | | $ | [removed: 9,696] [added: 9,057] | | | | | $ | [removed: 8,938] [added: 9,696] | |

| Research, development and engineering expenses | | | | | | [removed: 1,454] [added: 1,388] | | | | | | [removed: 1,235] [added: 1,454] | | | | | | [removed: 984] [added: 1,235] | | | | | | [removed: 971] [added: 984] | | | | | | [removed: 862] [added: 971] | | |

| Selling, general and administrative expenses | | | | | | [removed: 6,455] [added: 7,129] | | | | | | [removed: 6,427] [added: 6,455] | | | | | | [removed: 5,361] [added: 6,427] | | | | | | [removed: 5,356] [added: 5,361] | | | | | | [removed: 5,099] [added: 5,356] | | |

| Recall charges, net | | | | | | [removed: (15)] [added: 18] | | | | | | [removed: 103] [added: (15)] | | | | | | [removed: 17] [added: 103] | | | | | | [removed: 192] [added: 17] | | | | | | [removed: 23] [added: 192] | | |

| Amortization of intangible assets | | | | | | [removed: 627] [added: 635] | | | | | | [removed: 619] [added: 627] | | | | | | [removed: 472] [added: 619] | | | | | | [removed: 464] [added: 472] | | | | | | [removed: 417] [added: 464] | | |

| Goodwill impairment | | | | | | [removed: 216] [added: —] | | | | | | [removed: —] [added: 216] | | | | | | — | | | | | | — | | | | | | — | | |

| Total operating expenses | | | | | | $ | [removed: 8,737] [added: 9,170] | | | | | $ | [removed: 8,384] [added: 8,737] | | | | | $ | [removed: 6,834] [added: 8,384] | | | | | $ | [removed: 6,983] [added: 6,834] | | | | | $ | [removed: 6,401] [added: 6,983] | |

| Operating income | | | | | | $ | [removed: 2,841] [added: 3,888] | | | | | $ | [removed: 2,584] [added: 2,841] | | | | | $ | [removed: 2,223] [added: 2,584] | | | | | $ | [removed: 2,713] [added: 2,223] | | | | | $ | [removed: 2,537] [added: 2,713] | |

| Other income (expense), net | | | | | | [removed: (158)] [added: (215)] | | | | | | [removed: (303)] [added: (158)] | | | | | | [removed: (269)] [added: (303)] | | | | | | [removed: (151)] [added: (269)] | | | | | | [removed: (181)] [added: (151)] | | |

| Earnings before income taxes | | | | | | $ | [removed: 2,683] [added: 3,673] | | | | | $ | [removed: 2,281] [added: 2,683] | | | | | $ | [removed: 1,954] [added: 2,281] | | | | | $ | [removed: 2,562] [added: 1,954] | | | | | $ | [removed: 2,356] [added: 2,562] | |

| Income taxes | | | | | | [removed: 325] [added: 508] | | | | | | [removed: 287] [added: 325] | | | | | | [removed: 355] [added: 287] | | | | | | [removed: 479] [added: 355] | | | | | | [removed: (1,197)] [added: 479] | | |

| Net earnings | | | | | | $ | [removed: 2,358] [added: 3,165] | | | | | $ | [removed: 1,994] [added: 2,358] | | | | | $ | [removed: 1,599] [added: 1,994] | | | | | $ | [removed: 2,083] [added: 1,599] | | | | | $ | [removed: 3,553] [added: 2,083] | |

| Basic | | | | | | $ | [removed: 6.23] [added: 8.34] | | | | | $ | [removed: 5.29] [added: 6.23] | | | | | $ | [removed: 4.26] [added: 5.29] | | | | | $ | [removed: 5.57] [added: 4.26] | | | | | $ | [removed: 9.50] [added: 5.57] | |

| Diluted | | | | | | $ | [removed: 6.17] [added: 8.25] | | | | | $ | [removed: 5.21] [added: 6.17] | | | | | $ | [removed: 4.20] [added: 5.21] | | | | | $ | [removed: 5.48] [added: 4.20] | | | | | $ | [removed: 9.34] [added: 5.48] | |

| Dividends declared per share of common stock | | | | | | $ | [removed: 2.835] [added: 3.050] | | | | | $ | [removed: 2.585] [added: 2.835] | | | | | $ | [removed: 2.355] [added: 2.585] | | | | | $ | [removed: 2.135] [added: 2.355] | | | | | $ | [removed: 1.930] [added: 2.135] | |

| Cash, cash equivalents and current marketable securities | | | | | | $ | [removed: 1,928] [added: 3,053] | | | | | $ | [removed: 3,019] [added: 1,928] | | | | | $ | [removed: 3,024] [added: 3,019] | | | | | $ | [removed: 4,425] [added: 3,024] | | | | | $ | [removed: 3,699] [added: 4,425] | |

| Accounts receivable, net | | | | | | [removed: 3,565] [added: 3,765] | | | | | | [removed: 3,022] [added: 3,565] | | | | | | [removed: 2,701] [added: 3,022] | | | | | | [removed: 2,893] [added: 2,701] | | | | | | [removed: 2,332] [added: 2,893] | | |

| Inventories | | | | | | [removed: 3,995] [added: 4,843] | | | | | | [removed: 3,314] [added: 3,995] | | | | | | [removed: 3,494] [added: 3,314] | | | | | | [removed: 2,980] [added: 3,494] | | | | | | [removed: 2,955] [added: 2,980] | | |

| Property, plant and equipment, net | | | | | | [removed: 2,970] [added: 3,215] | | | | | | [removed: 2,833] [added: 2,970] | | | | | | [removed: 2,752] [added: 2,833] | | | | | | [removed: 2,567] [added: 2,752] | | | | | | [removed: 2,291] [added: 2,567] | | |

| Total assets | | | | | | $ | [removed: 36,884] [added: 39,912] | | | | | $ | [removed: 34,631] [added: 36,884] | | | | | $ | [removed: 34,330] [added: 34,631] | | | | | $ | [removed: 30,167] [added: 34,330] | | | | | $ | [removed: 27,229] [added: 30,167] | |

| Accounts payable | | | | | | [removed: 1,413] [added: 1,517] | | | | | | [removed: 1,129] [added: 1,413] | | | | | | [removed: 810] [added: 1,129] | | | | | | [removed: 675] [added: 810] | | | | | | [removed: 646] [added: 675] | | |

| Total debt | | | | | | [removed: 13,048] [added: 12,995] | | | | | | [removed: 12,479] [added: 13,048] | | | | | | [removed: 13,991] [added: 12,479] | | | | | | [removed: 11,090] [added: 13,991] | | | | | | [removed: 9,859] [added: 11,090] | | |

| Shareholders’ equity | | | | | | $ | [removed: 16,616] [added: 18,593] | | | | | $ | [removed: 14,877] [added: 16,616] | | | | | $ | [removed: 13,084] [added: 14,877] | | | | | $ | [removed: 12,807] [added: 13,084] | | | | | $ | [removed: 11,730] [added: 12,807] | |

| Net cash provided by operating activities | | | | | | $ | [removed: 2,624] [added: 3,711] | | | | | $ | [removed: 3,263] [added: 2,624] | | | | | $ | [removed: 3,277] [added: 3,263] | | | | | $ | [removed: 2,191] [added: 3,277] | | | | | $ | [removed: 2,610] [added: 2,191] | |

| Purchases of property, plant and equipment | | | | | | [removed: 588] [added: 575] | | | | | | [removed: 525] [added: 588] | | | | | | [removed: 487] [added: 525] | | | | | | [removed: 649] [added: 487] | | | | | | [removed: 572] [added: 649] | | |

| Depreciation | | | | | | [removed: 371] [added: 393] | | | | | | 371 | | | | | | [removed: 340] [added: 371] | | | | | | [removed: 314] [added: 340] | | | | | | [removed: 306] [added: 314] | | |

| Acquisitions, net of cash acquired | | | | | | [removed: 2,563] [added: 390] | | | | | | [removed: 339] [added: 2,563] | | | | | | [removed: 4,222] [added: 339] | | | | | | [removed: 802] [added: 4,222] | | | | | | [removed: 2,451] [added: 802] | | |

| Payments of dividends | | | | | | [removed: 1,051] [added: 1,139] | | | | | | [removed: 950] [added: 1,051] | | | | | | [removed: 863] [added: 950] | | | | | | [removed: 778] [added: 863] | | | | | | [removed: 703] [added: 778] | | |

| Repurchase of common stock | | | | | | — | | | | | | — | | | | | | — | | | | | | [removed: 307] [added: —] | | | | | | [removed: 300] [added: 307] | | |

| Number of shareholders of record | | | | | | [removed: 2,533] [added: 2,518] | | | | | | [removed: 2,551] [added: 2,533] | | | | | | [removed: 2,597] [added: 2,551] | | | | | | [removed: 2,636] [added: 2,597] | | | | | | [removed: 2,732] [added: 2,636] | | |

| Approximate number of employees | | | | | | [removed: 51,000] [added: 52,000] | | | | | | [removed: 46,000] [added: 51,000] | | | | | | [removed: 43,000] [added: 46,000] | | | | | | [removed: 40,000] [added: 43,000] | | | | | | [removed: 36,000] [added: 40,000] | | |

| Dollar amounts in millions except per share amounts or as otherwise specified. | | | [removed: 11] [added: 12] | | |

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

| Amortization of intangible assets | | | | | | 635 | | | | | | 627 | | | | | | 619 | | | | | | 472 | | | | | | 464 | | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

We have audited the accompanying consolidated balance sheets of Stryker Corporation and subsidiaries (the Company) as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of [removed: earnings and] [added: earnings,] comprehensive income, shareholders’ [removed: equity,] [added: equity] and cash [removed: flows,] [added: flows] for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] and the related notes and [removed: the] financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements“).

In our opinion, the consolidated financial statements present fairly, in all material respects, the [removed: consolidated] financial position of the Company at December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the [removed: consolidated] results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in Internal [removed: Control-Integrated] [added: Control—Integrated] Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 [removed: framework)] [added: framework),] and our report dated February [removed: 10, 2023] [added: 14, 2024] expressed an unqualified opinion thereon.

Critical Audit [removed: Matters][added: Matter]

The critical audit [removed: matters] [added: matter] communicated below [removed: are matters] [added: is a matter] arising from the current period audit of the financial statements that [removed: were] [added: was] communicated or required to be communicated to the audit committee and that: (1) [removed: relate] [added: relates] to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of [added: the] critical audit [removed: matters] [added: matter] does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matters] [added: matter] below, providing [added: a] separate [removed: opinions] [added: opinion] on the critical audit [removed: matters] [added: matter] or on the [removed: accounts] [added: account] or [removed: disclosures] [added: disclosure] to which [removed: they relate.][added: it relates.]

| *Description of the Matter* | | | As described in Note 11 to the consolidated financial statements, the Company operates in multiple jurisdictions with complex tax policy and regulatory environments and establishes reserves for uncertain tax positions in accordance with the accounting guidance governing uncertainty in income taxes. Assessing tax positions involves judgment including interpreting tax laws of multiple jurisdictions and assumptions relevant to the measurement of an unrecognized tax benefit, including the estimated amount of tax liability that may be incurred should the tax position not be sustained upon inspection by a tax authority. These judgments and assumptions can significantly affect the reserve for uncertain tax positions. At December 31, [removed: 2022,] [added: 2023,] the Company had accrued liabilities of [removed: $286] [added: $371] million relating to uncertain tax positions. | | |

[added: |] STRYKER [removed: CORPORATION 2022] [added: CORPORATION | | | | | | 2023] FORM 10-K [added: | | |]

[removed: | | | | Valuation of] Goodwill [removed: for] [added: attributable to] the Spine [removed: Reporting Unit | | |][added: reporting unit as of December 31, 2023 was $1,034.]

We have served as the Company's auditor since [removed: 1974][added: 1974.]

[removed: February 10, 2023][added: | | | | 2023 | | |]

| | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | |

| Net sales | | | $ | [removed: 18,449] [added: 20,498] | | | | | $ | [removed: 17,108] [added: 18,449] | | | | | $ | [removed: 14,351] [added: 17,108] | |

| Cost of sales | | | [removed: 6,871] [added: 7,440] | | | | | | [removed: 6,140] [added: 6,871] | | | | | | [removed: 5,294] [added: 6,140] | | |

| Gross profit | | | $ | [removed: 11,578] [added: 13,058] | | | | | $ | [removed: 10,968] [added: 11,578] | | | | | $ | [removed: 9,057] [added: 10,968] | |

| Research, development and engineering expenses | | | [removed: 1,454] [added: 1,388] | | | | | | [removed: 1,235] [added: 1,454] | | | | | | [removed: 984] [added: 1,235] | | |

| Selling, general and administrative expenses | | | [removed: 6,455] [added: 7,129] | | | | | | [removed: 6,427] [added: 6,455] | | | | | | [removed: 5,361] [added: 6,427] | | |

| Recall charges, net | | | [removed: (15)] [added: 18] | | | | | | [removed: 103] [added: (15)] | | | | | | [removed: 17] [added: 103] | | |

| Amortization of intangible assets | | | [removed: 627] [added: 635] | | | | | | [removed: 619] [added: 627] | | | | | | [removed: 472] [added: 619] | | |