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Johnson & Johnson

Johnson & JohnsonJNJEarnings & Financial Report

NYSE · Health Care · Pharmaceuticals

Johnson & Johnson (J&J) is an American multinational pharmaceutical, biotechnology, and medical technologies corporation headquartered in New Brunswick, New Jersey, and publicly traded on the New York Stock Exchange. Its common stock is a component of the Dow Jones Industrial Average, and the company is ranked No. 48 on the 2025 Fortune 500 list of the largest United States corporations. In 2025, the company was ranked 42th in the Forbes Global 2000.

What changed in Johnson & Johnson's 10-K — 2024 vs 2025

Top changes in Johnson & Johnson's 2025 10-K

235 paragraphs added · 239 removed · 193 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Innovative Medicine The Innovative Medicine segment is focused on the following therapeutic areas: Immunology (e.g., rheumatoid arthritis, psoriatic arthritis, inflammatory bowel disease and psoriasis), Infectious Diseases (e.g., HIV/AIDS), Neuroscience (e.g., mood disorders, neurodegenerative disorders and schizophrenia), Oncology (e.g., prostate cancer, hematologic malignancies, lung cancer and bladder cancer), Cardiovascular and Metabolism (e.g., thrombosis, diabetes and macular degeneration) and Pulmonary Hypertension (e.g., Pulmonary Arterial Hypertension).
Innovative Medicine The Innovative Medicine segment is focused on the following therapeutic areas: Oncology (e.g., prostate cancer, hematologic malignancies, lung cancer and bladder cancer), Immunology (e.g., rheumatoid arthritis, psoriatic arthritis, inflammatory bowel disease and psoriasis), Neuroscience (e.g., mood disorders, neurodegenerative disorders and schizophrenia), Pulmonary Hypertension (e.g., Pulmonary Arterial Hypertension), Infectious Diseases (e.g., HIV/AIDS) and Cardiovascular and Metabolism (e.g., thrombosis, diabetes and macular degeneration).
FDA and regulatory agencies around the globe are also increasing their enforcement activities. If the U.S. FDA were to conclude that we are not in compliance with applicable laws or regulations, or that any of our pharmaceutical products or medical technologies are ineffective or pose an unreasonable safety risk, the U.S.
The U.S. FDA and regulatory agencies around the globe are also increasing their enforcement activities. If the U.S. FDA were to conclude that we are not in compliance with applicable laws or regulations, or that any of our pharmaceutical products or medical technologies are ineffective or pose an unreasonable safety risk, the U.S.
The products sold in the international business include those developed in the U.S. and by subsidiaries abroad. Investments and activities in some countries outside the U.S. are subject to higher risks than comparable U.S. activities because the investment and commercial climate may be influenced by financial instability in international economies, restrictive economic policies and political and legal system uncertainties.
The products sold in the international business include those developed in the U.S. and by subsidiaries abroad. 2 Investments and activities in some countries outside the U.S. are subject to higher risks than comparable U.S. activities because the investment and commercial climate may be influenced by financial instability in international economies, restrictive economic policies and political and legal system uncertainties.
The U.S. FDA may also assess civil or criminal penalties against us, our officers or employees and impose operating restrictions on a company-wide basis, or enjoin and/or restrain certain conduct resulting in violations of applicable law. The U.S. FDA may also recommend prosecution to the U.S. Department of Justice.
The U.S. FDA may also assess civil or criminal penalties against us, our officers or employees and impose operating restrictions on a company-wide basis, or enjoin and/or restrain certain conduct resulting in violations of applicable law. The U.S. FDA may also recommend prosecution to the U.S. 4 Department of Justice.
Significant legal proceedings 2 and claims involving the Company's patent and other intellectual property are described in Note 19 Legal proceedings—Intellectual property of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Significant legal proceedings and claims involving the Company's patent and other intellectual property are described in Note 19 Legal proceedings—Intellectual property of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
The Company continues to address our employees needs through J&J Flex, a hybrid model that empowers the Company’s office-based employees to find a balance of in-person and remote work, while preserving the Company's culture and need for face-to-face engagement and leadership. 2024 Annual Report 7 Available information The Company’s main corporate website address is www.jnj.com .
The Company continues to address our employees needs through J&J Flex, a hybrid model that empowers the Company’s office-based employees to find a balance of in-person and remote work, while preserving the Company's culture and need for face-to-face engagement and leadership. 2025 Annual Report 7 Available information The Company’s main corporate website address is www.jnj.com .
FDA could ban such products, detain or seize adulterated or misbranded products, order a recall, repair, replacement, or refund of such products, withdraw approval for such products, refuse to grant pending applications for marketing authorization or require certificates of foreign governments for exports, and/or require us to notify health professionals and others that the products present unreasonable risks of substantial harm to the public health.
FDA could ban such products, detain or seize adulterated or misbranded products, order a recall, repair, replacement, or refund of such products, withdraw approval/clearance/classification for such products, refuse to grant pending applications for marketing authorization or require certificates of foreign governments for exports, and/or require us to notify health professionals and others that the products present unreasonable risks of substantial harm to the public health.
Various state and federal transparency laws and regulations require disclosures of payments and other transfers of value made to certain healthcare practitioners, including physicians, teaching hospitals, and certain non-physician practitioners. Federal and foreign laws governing international business practices require strict compliance with anti-bribery standards and certain prohibitions with respect to payments to any foreign government official.
Various state and federal transparency laws and regulations require disclosures of payments and other transfers of value made to certain healthcare practitioners, including physicians, teaching hospitals, and certain non-physician practitioners. Federal and foreign laws governing international business practices require strict compliance with anti-corruption standards and certain prohibitions with respect to payments to any foreign government official.
Item 1. Business General Johnson & Johnson and its subsidiaries (the Company) have approximately 138,100 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field. Johnson & Johnson is a holding company, with operating companies conducting business in virtually all countries of the world.
Item 1. Business General Johnson & Johnson and its subsidiaries (the Company) have approximately 138,200 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field. Johnson & Johnson is a holding company, with operating companies conducting business in virtually all countries of the world.
Investors and the public should note that the Company also announces information through its press releases and media statements at www.jnj.com/mediacenter , investor.jnj.com and www.factsabouttalc.com . We use these websites to communicate with investors and the public about our products, litigation and other matters.
Investors and the public should note that the Company also announces information through its press releases and media statements at www.jnj.com/media-center , investor.jnj.com and www.factsabouttalc.com . We use these websites to communicate with investors and the public about our products, litigation and other matters.
The regulatory agencies under whose purview the Company operates have administrative powers that may subject it to actions such as product withdrawals, recalls, seizure of products and other civil and criminal sanctions. In some cases, the Company’s subsidiaries may deem it advisable to initiate product recalls regardless of whether it has been required or directed to. The U.S.
The regulatory agencies under whose purview the Company operates have administrative powers that may subject it to actions such as product withdrawals, recalls, seizure of products and other civil and criminal sanctions. In some cases, the Company’s subsidiaries may deem it advisable to initiate field actions, such as product recalls, regardless of whether it has been required or directed to.
Of note is the increased enforcement activity by data protection authorities in various jurisdictions, particularly in the European Union, where significant fines have been levied on companies for data breaches, violations of privacy requirements, and unlawful cross-border data transfers.
Of note is the increased enforcement activity by data protection authorities in various jurisdictions, 2025 Annual Report 5 particularly in the European Union, where significant fines have been levied on companies for data breaches, violations of privacy requirements, and unlawful cross-border data transfers.
Further, the Company relies on global supply chains, and production and distribution processes, that are complex, and subject to increasing regulatory requirements that may affect sourcing, supply and pricing of materials used in the Company's products.
Further, the Company relies on global supply chains, and production and distribution processes, that are complex, and subject to increasing regulatory requirements that may affect sourcing, supply and pricing of materials used in the Company's products. These processes also are subject to complex and lengthy regulatory approvals.
Key products in the Innovative Medicine segment include: REMICADE (infliximab), a treatment for a number of immune-mediated inflammatory diseases; SIMPONI (golimumab), a subcutaneous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis, active ankylosing spondylitis and moderately active to severely active ulcerative colitis; SIMPONI ARIA (golimumab), an intravenous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis and active ankylosing spondylitis and active polyarticular juvenile idiopathic arthritis (pJIA) in people 2 years of age and older; STELARA (ustekinumab), a treatment for adults and children with moderate to severe plaque psoriasis, for adults with active psoriatic arthritis, for adults with moderately to severely active Crohn's disease and treatment of moderately to severely active ulcerative colitis; TREMFYA (guselkumab), a treatment for adults with moderate to severe plaque psoriasis and active psoriatic arthritis and ulcerative colitis; EDURANT (rilpivirine), PREZISTA (darunavir) and PREZCOBIX/REZOLSTA (darunavir/cobicistat), antiretroviral medicines for the treatment of human immunodeficiency virus (HIV) in combination with other antiretroviral products and SYMTUZA (darunavir/cobicistat/emtricitabine/tenofovir alafenamide), a once-daily single tablet regimen for the treatment of HIV; CONCERTA (methylphenidate HCl) extended-release tablets CII, a treatment for attention deficit hyperactivity disorder; INVEGA SUSTENNA/XEPLION (paliperidone palmitate), for the treatment of schizophrenia and schizoaffective disorder in adults; INVEGA TRINZA/TREVICTA (paliperidone palmitate), for the treatment of schizophrenia in patients after they have been adequately treated with INVEGA SUSTENNA for at least four months; SPRAVATO (Esketamine), a nasal spray, used along with an oral antidepressant, to treat adults with treatment-resistant depression (TRD) and depressive symptoms in adults with major depressive disorder (MDD) with suicidal thoughts or actions; CARVYKTI (ciltacabtagene autoleucel), a chimeric antigen receptor (CAR)-T-cell therapy for the treatment of patients with relapsed/refractory multiple 2024 Annual Report 1 myeloma; ZYTIGA (abiraterone acetate), a treatment for patients with prostate cancer; ERLEADA (apalutamide), a next-generation androgen receptor inhibitor for the treatment of patients with prostate cancer; IMBRUVICA (ibrutinib), a treatment for certain B-cell malignancies, or blood cancers and chronic graft versus host disease; DARZALEX (daratumumab), a treatment for multiple myeloma; DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), a treatment for multiple myeloma and light chain (AL) Amyloidosis; TECVAYLI (teclistamab-cqyv), a ready-to-use bispecific antibody for adults with relapsed or refractory multiple myeloma who have received at least four prior lines of therapy; XARELTO (rivaroxaban), an oral anticoagulant for the prevention of deep vein thrombosis (DVT), which may lead to pulmonary embolism (PE) in patients undergoing hip or knee replacement surgery, to reduce the risk of stroke and systemic embolism in patients with nonvalvular atrial fibrillation, and for the treatment and reduction of risk of recurrence of DVT and PE to reduce the risk of major cardiovascular events in patients with coronary artery disease (CAD) and peripheral artery disease (PAD), for the treatment and secondary prevention of thromboembolism in pediatric patients, and for thromboprophylaxis in pediatric patients following the Fontan procedure; OPSUMIT (macitentan) as monotherapy or in combination, indicated for the long-term treatment of pulmonary arterial hypertension (PAH); UPTRAVI (selexipag), the only approved oral and intravenous, selective IP receptor agonist targeting a prostacyclin pathway in PAH.
Key products in the Innovative Medicine segment include: CARVYKTI (ciltacabtagene autoleucel), a chimeric antigen receptor (CAR)-T-cell therapy for the treatment of patients with relapsed/refractory multiple myeloma; DARZALEX (daratumumab), a treatment for multiple myeloma; DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), a treatment for multiple myeloma and light chain (AL) Amyloidosis; ERLEADA (apalutamide), a next-generation androgen receptor inhibitor for the treatment of patients with prostate cancer; IMBRUVICA (ibrutinib), a treatment for certain B-cell malignancies, or blood cancers and chronic graft versus host disease; RYBREVANT (amivantamab), a fully-human bispecific antibody for adults with EGFR-mutated non-small cell lung cancer and LAZCLUZE (lazertinib), an oral, brain-penetrant EGFR tyrosine kinase inhibitor for non-small cell lung cancer; RYBREVANT FASPRO (amivantamab and hyaluronidase-lpuj), a subcutaneous therapy for patients with non-small cell lung cancer; TALVEY (talquetamab-tgvs) a bispecific antibody for adults with relapsed or refractory multiple myeloma who have received at least four prior lines of therapy; TECVAYLI (teclistamab-cqyv), a bispecific antibody for adults with relapsed or refractory multiple myeloma who have received at least four prior lines of therapy; ZYTIGA (abiraterone acetate), a treatment for patients with prostate cancer; REMICADE (infliximab), a treatment for a number of immune-mediated inflammatory diseases; SIMPONI (golimumab), a subcutaneous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis, active ankylosing spondylitis and moderately active to severely active ulcerative colitis; SIMPONI ARIA (golimumab), an intravenous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis and active ankylosing spondylitis and active polyarticular juvenile idiopathic arthritis (pJIA) in people 2 years of age and older; STELARA (ustekinumab), a treatment for adults and children with moderate to severe plaque psoriasis, for adults with active psoriatic arthritis, for adults with moderately to severely active Crohn's disease and treatment of moderately to severely active 2025 Annual Report 1 ulcerative colitis; TREMFYA (guselkumab), a treatment for patients with moderate-to-severe plaque psoriasis, active psoriatic arthritis, moderate-to-severe Crohn’s disease and moderate-to-severe ulcerative colitis; CAPLYTA (lumateperone) is used in adults along with an antidepressant to treat major depressive disorder (MDD), depressive episodes associated with bipolar I or bipolar II disorder (bipolar depression) alone or with lithium or valproate; or to treat schizophrenia; CONCERTA (methylphenidate HCl) extended-release tablets CII, a treatment for attention deficit hyperactivity disorder; INVEGA SUSTENNA/XEPLION (paliperidone palmitate), for the treatment of schizophrenia and schizoaffective disorder in adults; INVEGA TRINZA/TREVICTA (paliperidone palmitate), for the treatment of schizophrenia in patients after they have been adequately treated with INVEGA SUSTENNA for at least four months; SPRAVATO (Esketamine), a nasal spray, used along with an oral antidepressant, to treat adults with treatment-resistant depression (TRD) and depressive symptoms in adults with major depressive disorder (MDD) with suicidal thoughts or actions; EDURANT (rilpivirine), PREZISTA (darunavir) and PREZCOBIX/REZOLSTA (darunavir/cobicistat), antiretroviral medicines for the treatment of human immunodeficiency virus (HIV) in combination with other antiretroviral products and SYMTUZA (darunavir/cobicistat/emtricitabine/tenofovir alafenamide), a once-daily single tablet regimen for the treatment of HIV; OPSUMIT (macitentan)/OPSYNVI (macitentan/tadalafil) as monotherapy or in combination, indicated for the long-term treatment of pulmonary arterial hypertension (PAH); UPTRAVI (selexipag), the only approved oral and intravenous, selective IP receptor agonist targeting a prostacyclin pathway in PAH; XARELTO (rivaroxaban), an oral anticoagulant for the prevention of deep vein thrombosis (DVT), which may lead to pulmonary embolism (PE) in patients undergoing hip or knee replacement surgery, to reduce the risk of stroke and systemic embolism in patients with nonvalvular atrial fibrillation, and for the treatment and reduction of risk of recurrence of DVT and PE to reduce the risk of major cardiovascular events in patients with coronary artery disease (CAD) and peripheral artery disease (PAD), for the treatment and secondary prevention of thromboembolism in pediatric patients, and for thromboprophylaxis in pediatric patients following the Fontan procedure.
On August 29, 2023, the Centers for Medicare & Medicaid Services (“CMS”) published the first “Selected Drug” list, which includes XARELTO and STELARA as well as IMBRUVICA, which is developed in collaboration and co-commercialized in the U.S. with Pharmacyclics LLC, an AbbVie company.
In 2023, the Centers for Medicare & Medicaid Services (CMS) published the first “Selected Drug” list, which includes XARELTO and STELARA as well as IMBRUVICA, which is developed in collaboration and co-commercialized in the U.S. with Pharmacyclics LLC, an AbbVie company.
Environment The Company is subject to a variety of environmental laws and regulations in the United States and other jurisdictions. The Company believes that its operations comply in all material respects with applicable environmental laws and regulations.
The competitive environment requires substantial investments in continuing research. Environment The Company is subject to a variety of environmental laws and regulations in the United States and other jurisdictions. The Company believes that its operations comply in all material respects with applicable environmental laws and regulations.
The Company's total rewards offerings include an array of programs to support its employees' well-being, including annual performance incentive opportunities, pension and retirement savings programs, health and welfare benefits, paid time off, leave programs, flexible work schedules and employee assistance programs.
The Company observes legal minimum wage provisions and exceeds them where possible. The Company's total rewards offerings include an array of programs to support its employees' well-being, including annual performance incentive opportunities, pension and retirement savings programs, health and welfare benefits, paid time off, leave programs, flexible work schedules and employee assistance programs.
At the federal level, in August 2022, President Biden signed into law the Inflation Reduction Act (IRA), which includes provisions that effectively authorize the government to establish prices for certain high-spend single-source drugs and biologics reimbursed by the Medicare program, starting in 2026 for Medicare Part D drugs and 2028 for Medicare Part B drugs.
The federal Inflation Reduction Act of 2022 (IRA) includes provisions that effectively authorize the government to establish prices for certain high-spend single-source drugs and biologics reimbursed by the Medicare program, starting in 2026 for Medicare Part D drugs and 2028 for Medicare Part B drugs.
FDA) continues to result in increases in the amounts of testing and documentation required for U.S. FDA approval of new drugs and devices and a corresponding increase in the expense of product introduction.
FDA) continues to result in increases in the amounts of testing and documentation required for U.S. FDA approval of new drugs and devices and a corresponding increase in the expense of product introduction. Similar trends are also evident in major markets outside of the U.S.
The impact of the IRA on our business and the broader pharmaceutical industry remains uncertain, as litigation filed by Janssen and other pharmaceutical companies remains ongoing and while CMS has publicly announced the maximum fair price for each of the selected drugs, implementation of the program is still in progress.
While the impact of the IRA on our business and the broader pharmaceutical industry remains uncertain, as litigation filed by Janssen and other pharmaceutical companies remains ongoing, CMS has publicly announced the maximum fair price for each of the selected drugs and has recently begun implementing the program. In December 2025, Janssen sought review by the U.S.
The Company’s human capital management strategy is built on three fundamental focus areas: • Attracting and recruiting top talent • Developing and retaining top talent • Empowering and inspiring talent Underpinning these focus areas are ongoing efforts to cultivate and foster a culture built on innovation, health, well-being and safety, inclusion and belonging where the Company's employees are encouraged to succeed both professionally and personally while helping the Company achieve its business goals.
The Company’s human capital management strategy is built on three fundamental focus areas: • Attracting and recruiting top talent • Developing and retaining top talent • Empowering and inspiring talent Underpinning these focus areas are ongoing efforts to cultivate and foster a culture built on innovation, health, well-being and safety, inclusion and belonging where the Company's employees are encouraged to succeed both professionally and personally while helping the Company achieve its business goals. 6 Culture and employee engagement At Johnson & Johnson, employees are guided by Our Credo, which sets forth the Company's responsibilities to patients, consumers, customers, healthcare professionals, employees, communities and shareholders.
The IRA specifies a ceiling price but not a minimum price for selected drugs and does not require CMS to use a specific framework for determining selected drug prices.
The IRA specifies a ceiling price but not a minimum price for selected drugs and does not require CMS to use a specific framework for determining selected drug prices. The selected products are subject to a government-established price for the Medicare population beginning in 2026.
In the EU, multiple directives and laws (including NIS2, EHDS, the Data Act, the Cyber Resilience Act, and the AI Act) are rapidly changing privacy and cybersecurity compliance requirements while introducing new enforcement risks.
FDA, FTC and HHS) continue to stress the intersection of health and privacy as a compliance and enforcement priority. In the EU, multiple directives and laws (including NIS2, EHDS, the Data Act, the Cyber Resilience Act, and the AI Act) are rapidly changing privacy and cybersecurity compliance requirements while introducing new enforcement risks.
In April 2024, Janssen appealed the district court’s denial of its summary judgment motion to the Third Circuit. Additionally, we expect continued scrutiny on drug pricing and government price reporting from Congress, agencies, and other bodies at the federal and state levels, which may result in additional regulations or other mechanisms to increase pricing transparency and controls.
Additionally, we expect continued scrutiny on drug pricing and government price reporting from Congress, agencies, and other bodies at the federal and state levels, which may result in additional regulations, including models or other mechanisms to increase pricing controls and/or transparency.
Many of these medicines were developed in collaboration with strategic partners or are licensed from other companies and maintain active lifecycle development programs. MedTech The MedTech segment includes a broad portfolio of products used in the cardiovascular, orthopaedics, surgery, and vision categories.
Many of these medicines were developed in collaboration with strategic partners or are licensed from other companies and maintain active lifecycle development programs. MedTech The MedTech segment develops and manufactures a broad portfolio of products used in cardiovascular, orthopaedics, surgery, and vision supporting physicians, hospitals, eye care professionals and healthcare systems across a wide range of acute and elective procedures.
In any event, we anticipate that the selected products will be subjected to a government-established price for the Medicare population beginning in 2026. 4 The IRA also contains provisions that impose rebates if certain prices increase at a rate that outpaces the rate of inflation, beginning October 1, 2022, for Medicare Part D drugs and January 1, 2023, for Medicare Part B drugs.
The IRA also contains provisions that impose rebates if certain prices increase at a rate that outpaces the rate of inflation, beginning October 1, 2022, for Medicare Part D drugs and January 1, 2023, for Medicare Part B drugs.
These processes also are subject to complex and lengthy regulatory approvals. 2024 Annual Report 5 Employees and human capital management As of December 29, 2024 and December 31, 2023 the number of employees was approximately: 2024 2023 Employees (1) 139,800 134,400 Full-time equivalent (FTE) positions (2) 138,100 131,900 (1) “Employee” is defined as an individual working full-time or part-time, excluding fixed term employees, interns and co-op employees.
Employees and human capital management As of December 28, 2025 and December 29, 2024 the number of employees was approximately: 2025 2024 Employees (1) 140,800 139,800 Full-time equivalent (FTE) positions (2) 138,200 138,100 (1) “Employee” is defined as an individual working full-time or part-time, excluding fixed term employees, interns and co-op employees.
The Company conducts global surveys that offer its employees the ability to provide feedback and valuable insight to help address potential human resources risks and identify opportunities to improve.
The Company conducts global surveys that offer its employees the ability to provide feedback and valuable insight to help address potential human resources risks and identify opportunities to improve. In 2025, 95% of global employees across 73 countries participated in Our Credo Survey which was offered in 36 languages.
The development of new and innovative products, as well as protecting the underlying intellectual property of the Company’s product portfolio, is important to the Company's success in all areas of its business. The competitive environment requires substantial investments in continuing research.
Competition in research, both internally and externally sourced, involving the development and the improvement of new and existing products and processes, is particularly significant. The development of new and innovative products, as well as protecting the underlying intellectual property of the Company’s product portfolio, is important to the Company's success in all areas of its business.
Compensation and benefits As part of the Company's total rewards philosophy, the Company offers competitive compensation and benefits to attract and retain top talent. The Company is committed to fair treatment in its compensation and benefits for employees at all levels. The Company observes legal minimum wage provisions and exceeds them where possible.
We are committed to cultivating an inclusive, Credo‑based work environment where employees are recognized and rewarded based on merit. Compensation and benefits As part of the Company's total rewards philosophy, the Company offers competitive compensation and benefits to attract and retain top talent. The Company is committed to fair treatment in its compensation and benefits for employees at all levels.
The Cardiovascular (previously referred to as Interventional solutions) portfolio includes electrophysiology products to treat heart rhythm disorders, the heart recovery portfolio (Abiomed) which includes technologies to treat severe coronary artery disease requiring high-risk PCI or AMI cardiogenic shock, circulatory restoration products (Shockwave) for the treatment of calcified coronary artery disease (CAD) and peripheral artery disease (PAD), and neurovascular care that treats hemorrhagic and ischemic stroke.
The Cardiovascular portfolio includes electrophysiology products used to diagnose and treat heart rhythm disorders, mechanical circulatory support technologies (Abiomed) used in patients with cardiogenic shock or those undergoing a high-risk percutaneous coronary intervention (PCI), circulatory restoration products (Shockwave) for the treatment of calcified coronary artery disease (CAD) and peripheral artery disease (PAD), and neurovascular care that treats stroke and other conditions.
Similar trends are also evident in major markets outside of the U.S. 2024 Annual Report 3 The medical device regulatory framework and the evolving privacy, data localization, and emerging cyber security laws and regulations around the world are examples of such increased regulation. Within the U.S., an increasing number of U.S.
The medical device regulatory framework and the evolving privacy, data localization, and emerging cyber security laws and regulations around the world are examples of such increased regulation. Within the U.S., an increasing number of U.S. States have enacted comprehensive privacy laws, and federal regulators (e.g., the U.S.
Management is responsible for ensuring that its policies and processes reflect and reinforce the Company's desired corporate culture, including policies and processes related to strategy, risk management, and ethics and compliance.
Employees by region (in percentages) Strategy The Company believes that its employees are critical to its continued success and are an essential element of its long-term strategy. Management is responsible for ensuring that its policies and processes reflect and reinforce the Company's desired corporate culture, including policies and processes related to strategy, risk management, and ethics and compliance.
They own, or are licensed under, a significant number of patents in the U.S. and other countries relating to their products, product uses, formulations and manufacturing processes, which in the aggregate are believed to be of material importance to the Company in the operation of its businesses.
Patents The Company's subsidiaries have made a practice of obtaining patent protection on their products and processes where possible. They own, or are licensed under, a significant number of patents in the U.S. and other countries relating to their products, product uses, formulations and manufacturing processes.
The Company's objective is to foster a learning culture that helps shape each person’s unique career path while creating a robust pipeline of talent to deliver on the Company’s long-term strategies. In furtherance of this objective, the Company deploys a global approach to ensure development is for everyone, regardless of where they are on their career journey.
Accordingly, professional development programs and educational resources are available to all employees. The Company's objective is to foster a learning culture that helps shape each person’s unique career path while creating a robust pipeline of talent to deliver on the Company’s long-term strategies.
Competition In all of their product lines, the Company's subsidiaries compete with companies both locally and globally. Competition exists in all product lines without regard to the number and size of the competing companies involved. Competition in research, both internally and externally sourced, involving the development and the improvement of new and existing products and processes, is particularly significant.
This reflects increased spending decisions, principally for advertising and research and development activity. 2025 Annual Report 3 Competition In all of their product lines, the Company's subsidiaries compete with companies both locally and globally. Competition exists in all product lines without regard to the number and size of the competing companies involved.
Employee data may not include full population from more recently acquired companies and individuals on long-term disability are excluded. Contingent workers, contractors and subcontractors are also excluded. Shockwave has been included in the fiscal 2024 headcount in the above table.
Employee data may not include full population from more recently acquired companies and individuals on long-term disability are excluded. Contingent workers, contractors and subcontractors are also excluded. (2) FTE represents the total number of full-time equivalent positions and does not reflect the total number of individual employees as some work part-time.
The Company considers these trademarks in the aggregate to be of material importance in the operation of its businesses. Seasonality Worldwide sales do not reflect any significant degree of seasonality; however, spending has typically been heavier in the fourth quarter of each year than in other quarters. This reflects increased spending decisions, principally for advertising and research and development activity.
These trademarks are protected by registration in the U.S. and other countries where such products are marketed. Seasonality Worldwide sales do not reflect any significant degree of seasonality; however, spending has typically been heavier in the fourth quarter of each year than in other quarters.
The Company believes that its employees must be equipped with the right knowledge and skills and be provided with opportunities to grow and develop in their careers. Accordingly, professional development programs and educational resources are available to all employees.
Growth and development To lead in the changing healthcare landscape, it is crucial that the Company continue to attract and retain top talent. In 2025, the Company's voluntary turnover rate was 5.8%. The Company believes that its employees must be equipped with the right knowledge and skills and be provided with opportunities to grow and develop in their careers.
These products are distributed to wholesalers, hospitals, and retailers and are used predominantly in the professional fields by physicians, nurses, hospitals, eye care professionals, and clinics. Geographic areas The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being.
Vision products are used by eye care professionals and ophthalmic surgeons and span both corrective and surgical vision care. These MedTech products are distributed to wholesalers, hospitals, and retailers and are used predominantly in the professional fields by physicians, nurses, hospitals, eye care professionals, and clinics. In October 2025, the Company announced its intention to separate its Orthopaedics business.
Sales of the Company’s largest product, collectively DARZALEX (daratumumab) and DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), accounted for approximately 13.1% of the Company's total revenues for fiscal 2024. Accordingly, the patents related to these products are believed to be material to the Company.
Sales of the Company’s largest product, collectively DARZALEX (daratumumab) and DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), accounted for approximately 15.0% of the Company's total revenues for fiscal 2025. Genmab A/S owns two patent families related to DARZALEX, and Janssen Biotech, Inc. (a wholly-owned subsidiary of the Company) has an exclusive license to those patent families.
Trademarks The Company’s subsidiaries have made a practice of selling their products under trademarks and of obtaining protection for these trademarks by all available means. These trademarks are protected by registration in the U.S. and other countries where such products are marketed.
In addition, Janssen Biotech, Inc. is a party to license agreements related to TREMFYA with an aggregate royalty rate of approximately 5.0% of total TREMFYA net sales payable to third parties. Trademarks The Company’s subsidiaries have made a practice of selling their products under trademarks and of obtaining protection for these trademarks by all available means.
To prioritize learning, the Company recently held Johnson & Johnson's second Global Learning Day. Employees were encouraged to set aside a full day to explore skill-building courses on J&J Learn, the new state-of-the-art learning platform. Our workforce As stated in Our Credo, we are responsible to our employees who work with us throughout the world.
In furtherance of this objective, the Company deploys a global approach to ensure development is for everyone, regardless of where they are on their career journey. To prioritize learning, the Company has an annual Global Learning Day in which employees are encouraged to set aside a full day to explore skill-building courses on its state-of-the-art learning platform, J&J Learn.
Genmab A/S owns two patent families related to DARZALEX, and Janssen Biotech, Inc. has an exclusive license to those patent families. The two patent families both expire in the United States in 2029, and in Europe, compound/use patent protection in select countries extends to 2031/2032. Janssen Biotech, Inc. owns a separate patent portfolio related to DARZALEX FASPRO.
Royalty rate ranges from 12% to 20% of total DARZALEX net sales. For the fiscal 2025 and 2024, royalty amounts to Genmab were approximately $2.4 billion and $2.0 billion, respectively. The two patent families both expire in the United States in 2029, and in Europe, compound/use patent protection in select countries extends to 2031/2032.
The Company is dedicated to the values in Our Credo and strives to meet the needs of its employees and stakeholders through compliance with law and the following evidence based strategies: • Sustain a global workforce of individuals with many different backgrounds, abilities, cultures and perspectives • Maintain a work environment where each person’s dignity is respected and they have an opportunity to advance based on their merit • Drive innovation and growth with our business to serve markets around the world Our approach with respect to our workforce is guided by applicable laws, internal and external insights, global best practices and employee feedback.
Our workforce As stated in Our Credo, we are responsible to our employees who work with us throughout the world. As a result, and as guided by applicable laws, external insights and employee feedback, we continually strive to meet the needs of our global workforce of individuals from many different backgrounds, abilities, cultures and perspectives.
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The Orthopaedics portfolio includes products and enabling technologies that support hips, knees, trauma, spine, sports, and others. The Surgery portfolios include advanced and general surgery technologies, as well as solutions that focus on breast aesthetics and reconstruction (Mentor). Vision products include ACUVUE brand contact lenses and TECNIS intraocular lenses for cataract surgery.
Added
These products are designed to address disease states where procedural intervention plays a central role in treatment and patient outcomes.
Removed
Patents The Company's subsidiaries have made a practice of obtaining patent protection on their products and processes where possible.
Added
These offerings are primarily delivered through minimally invasive, catheter based approaches and are used by interventional cardiologists, electrophysiologists and neurointerventional specialists. The Orthopaedics portfolio includes products and enabling technologies that support joint reconstruction, trauma, spine, sports-related injuries, and others. The Surgery portfolio includes a range of surgical products and enabling technologies for use across open, laparoscopic and robotic surgical procedures.
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Sales of the Company’s second largest product, STELARA (ustekinumab) accounted for approximately 11.7% of the Company's total revenues for fiscal 2024. According to patent settlement and license agreements, the Company expects continued launches of biosimilar versions of STELARA in Europe and the United States in 2025 which will impact the Company’s sales of STELARA.
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This portfolio includes instrumentation, energy devices, stapling systems, wound closure, biosurgery products, and digital and robotic technologies designed to support procedural consistency and efficiency across multiple surgical specialties. The Surgery portfolio also includes solutions that focus on breast aesthetics and reconstruction (Mentor).
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States have enacted comprehensive privacy laws, and federal regulators (e.g., the U.S. FDA, FTC and HHS) continue to stress the intersection of health and privacy as a compliance and enforcement priority.
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These products are used in hospitals and surgical centers worldwide and are supported by ongoing development of surgical techniques and clinical evidence. The Vision portfolio includes contact lenses marketed under the ACUVUE brand, TECNIS premium intraocular lenses for cataract surgery, and other products used in cataract and refractive procedures.
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The Selected Drug list also included other medicines targeting disease states that are prevalent in the Medicare population. Although CMS published an explanation for how it determined prices for selected drugs in December 2024, uncertainty remains as to the methodology used to determine these prices.
Added
The Company intends to explore multiple paths to effect the planned separation with a targeted completion within 18 to 24 months after the initial announcement. Geographic areas The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being.
Removed
(2) FTE represents the total number of full-time equivalent positions and does not reflect the total number of individual employees as some work part-time. Employees by region (in percentages) Strategy The Company believes that its employees are critical to its continued success and are an essential element of its long-term strategy.
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Janssen Biotech, Inc. owns separate patent portfolios related to DARZALEX FASPRO and DARZALEX IV. Sales of the Company’s second largest product, STELARA (ustekinumab) accounted for approximately 6.5% of the Company's total revenues for fiscal 2025. Third parties have filed biologics license applications with the U.S.
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Culture and employee engagement At Johnson & Johnson, employees are guided by Our Credo, which sets forth the Company's responsibilities to patients, consumers, customers, healthcare professionals, employees, communities and shareholders.
Added
FDA, the European Medicines Agency, and other government authorities seeking approval to market biosimilar versions of STELARA around the globe. The Company expects continued launches of biosimilar versions of STELARA globally which will continue to negatively impact the Company’s sales of STELARA.
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In 2024, 94% of global employees across 73 countries participated in Our Credo Survey which was offered in 36 languages. 6 Growth and development To lead in the changing healthcare landscape, it is crucial that the Company continue to attract and retain top talent. In 2024, the Company's voluntary turnover rate was 6.3%.
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Sales of the Company’s third largest product, TREMFYA (guselkumab), accounted for approximately 5.5% of the Company's total revenues for fiscal 2025. Janssen Biotech, Inc. owns multiple patent families related to TREMFYA, including a composition patent family projected to expire in the United States in 2031.
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The Company is committed to cultivating, fostering and advancing an inclusive, credo-based work environment for employees that recognizes and rewards based on merit.
Added
CMS has indicated that, beginning in 2027, it will remove Xarelto and Stelara from the Selected Drug List, such that the products will no longer be subject to the IRA's minimum pricing provisions. In January 2026, CMS published the Selected Drug list for 2028, which includes ERLEADA.
Added
Supreme Court of the Third Circuit majority's affirmance of the district court's denial of its summary judgment motion. In January 2026, the Company reached an agreement with the U.S. Administration to improve access to medicines and lower costs for U.S. patients.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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A change in statutory tax rate or certain international tax provisions in any country would result in the revaluation of the Company’s deferred tax assets and liabilities related to that particular jurisdiction in the period in which the new tax law is enacted. This change would result in an expense or benefit recorded to the Company’s Consolidated Statement of Earnings.
A change in statutory tax rate or certain international tax provisions in any country would result in the revaluation of the Company’s deferred tax assets and liabilities related to that particular jurisdiction in the period in which the new tax law is enacted. This change would result in an expense or benefit recorded in the Company’s Consolidated Statement of Earnings.
Most recently, we have experienced, and expect to continue to experience, impacts to the Company's business resulting from the Russia-Ukraine war, rising conflict in the Middle East as well as increasing tensions between the U.S. and China. In response to heightened conflict, such as the Russia-Ukraine war, governments may impose export controls and broad financial and economic sanctions.
Most recently, we have experienced, and expect to continue to experience, impacts to the Company's business resulting from the Russia-Ukraine war, conflict in the Middle East as well as increasing tensions between the U.S. and China. In response to heightened conflict, such as the Russia- Ukraine war, governments may impose export controls and broad financial and economic sanctions.
However, we cannot guarantee that these third-party manufacturers will be able to meet our near-term or long-term manufacturing requirements, which could result in lost sales and have an adverse effect on our business. 2024 Annual Report 9 Other risks associated with our reliance on third parties to manufacture these products include reliance on the third party for regulatory compliance and quality assurance, misappropriation of the Company’s intellectual property, limited ability to manage our inventory, possible breach of the manufacturing agreement by the third party and the possible termination or nonrenewal of the manufacturing agreement by the third party at a time that is costly or inconvenient for us.
However, we cannot guarantee that these third-party manufacturers will be able to meet our near-term or long-term manufacturing requirements, which could result in lost sales and have an adverse effect on our business. 2025 Annual Report 9 Other risks associated with our reliance on third parties to manufacture these products include reliance on the third party for regulatory compliance and quality assurance, misappropriation of the Company’s intellectual property, limited ability to manage our inventory, possible breach of the manufacturing agreement by the third party and the possible termination or nonrenewal of the manufacturing agreement by the third party at a time that is costly or inconvenient for us.
While the Company strives to maintain profit margins in these areas through cost reduction programs, productivity improvements and periodic price increases, it might experience operating losses as a result of continued inflation. 2024 Annual Report 13 In addition, the impact of currency devaluations in countries experiencing high inflation rates or significant currency exchange fluctuations could negatively impact the Company’s operating results.
While the Company strives to maintain profit margins in these areas through cost reduction programs, productivity improvements and periodic price increases, it might experience operating losses as a result of continued inflation. 2025 Annual Report 13 In addition, the impact of currency devaluations in countries experiencing high inflation rates or significant currency exchange fluctuations could negatively impact the Company’s operating results.
The most significant current investigations and litigation brought by government agencies are described in Note 19 Legal proceedings—Government proceedings under Notes to the Consolidated Financial Statements included in Item 8 of this Report. 2024 Annual Report 11 Changes in tax laws or exposures to additional tax liabilities could negatively impact the Company’s operating results.
The most significant current investigations and litigation brought by government agencies are described in Note 19 Legal proceedings—Government proceedings under Notes to the Consolidated Financial Statements included in Item 8 of this Report. 2025 Annual Report 11 Changes in tax laws or exposures to additional tax liabilities could negatively impact the Company’s operating results.
Development of successful products and technologies is also necessary to offset revenue losses when the Company’s existing products lose market share due to various factors such as competition and loss of patent exclusivity. New products introduced within the past five years accounted for approximately 25% of 2024 sales.
Development of successful products and technologies is also necessary to offset revenue losses when the Company’s existing products lose market share due to various factors such as competition and loss of patent exclusivity. New products introduced within the past five years accounted for approximately 25% of 2025 sales.
Foreign currency exchange : In fiscal 2024, approximately 43% of the Company’s sales occurred outside of the U.S., with approximately 23% in Europe, 5% in the Western Hemisphere, excluding the U.S., and 15% in the Asia-Pacific and Africa region. Changes in non-U.S. currencies relative to the U.S. dollar impact the Company’s revenues and expenses.
Foreign currency exchange : In fiscal 2025, approximately 43% of the Company’s sales occurred outside of the U.S., with approximately 23% in Europe, 5% in the Western Hemisphere, excluding the U.S., and 15% in the Asia-Pacific and Africa region. Changes in non-U.S. currencies relative to the U.S. dollar impact the Company’s revenues and expenses.
Anti-bribery and other regulations : The Company is subject to various federal and foreign laws that govern its international business practices with respect to payments to government officials. Those laws include the U.S.
Anti-corruption and other regulations : The Company is subject to various federal and foreign laws that govern its international business practices with respect to payments to government officials. Those laws include the U.S.
The Company’s manufacturing of products requires the timely delivery of sufficient amounts of complex, high-quality components and materials. The Company’s subsidiaries operate 64 manufacturing facilities as well as sourcing from thousands of suppliers around the world.
The Company’s manufacturing of products requires the timely delivery of sufficient amounts of complex, high-quality components and materials. The Company’s subsidiaries operate 63 manufacturing facilities as well as sourcing from thousands of suppliers around the world.
Furthermore, in some countries, such as in Russia, action may be taken that allows companies and individuals to exploit inventions owned by patent holders from the United States and many other countries without consent or compensation and we may not be able to prevent third parties from practicing the Company's inventions in Russia or from selling or importing products in and into Russia.
Furthermore, in some countries, action may be taken that allows companies and individuals to exploit inventions owned by patent holders from the United States and many other countries without consent or compensation and we may not be able to prevent third parties from practicing the Company's inventions or from selling or importing products.
Any unsuccessful implementation of our succession plans or failure to ensure effective transfer of knowledge and smooth transitions involving key employees could adversely affect our business, financial condition, or results of operations. Climate change or legal, regulatory or market measures to address climate change may negatively affect our business and results of operations.
Any unsuccessful implementation of our succession plans or failure to ensure effective transfer of knowledge and smooth transitions involving key employees could adversely affect our business, financial condition, or results of operations. 2025 Annual Report 15 Climate change or legal, regulatory or market measures to address climate change may negatively affect our business and results of operations.
The Company assesses these threats, responds to attacks and breaches that it has experienced, and makes investments to increase internal protection, detection, and response capabilities, as well as ensure the Company’s third-party providers have required capabilities and 2024 Annual Report 15 controls, to address this risk.
The Company assesses these threats, responds to attacks and breaches that it has experienced, and makes investments to increase internal protection, detection, and response capabilities, as well as ensure the Company’s third-party providers have required capabilities and controls, to address this risk.
Outside the U.S., numerous major markets, including the EU, United Kingdom, Japan and China, have pervasive government involvement in funding healthcare and, in that regard, directly or indirectly impose price controls, limit access to, or reimbursement for, the Company’s products, or reduce the value of its intellectual property protection. 10 We are subject to an increasing number of costly and complex governmental regulations in the countries in which operations are conducted which may materially adversely affect the Company’s financial condition and business operations.
Outside the U.S., numerous major markets, including the EU, United Kingdom, Japan and China, have pervasive government involvement in funding healthcare and, in that regard, directly or indirectly impose price controls, limit access to, or reimbursement for, the Company’s products, or reduce the value of its intellectual property protection. 10 The Company is subject to an increasing number of costly and complex governmental regulations in the countries in which operations are conducted which may have a material adverse affect on the Company’s financial condition and business operations.
Because of the frequently changing attack techniques, along with the increased volume and sophistication of the attacks, there is the potential for the Company to be adversely impacted. This impact could result in reputational, competitive, operational or other business harm as well as financial costs and regulatory action. Also, increasing use of AI could increase these risks.
Because of the frequently changing attack techniques, along with the increased volume and sophistication of the attacks and increasing use and reliance on third parties, there is the potential for the Company to be adversely impacted. This impact could result in reputational, competitive, operational or other business harm as well as financial costs and regulatory action.
Our business and operations may be further impacted by the imposition of tariffs, trade protection measures or other policies adopted by any country that favor domestic companies and technologies over foreign competitors.
Our business and operations may be further impacted by the imposition of tariffs, trade protection measures or other policies - including data localization laws and restrictions on data transfers - adopted by any country that favor domestic companies and technologies over foreign competitors.
Specifically, the Company has accounted for operations in Argentina, Turkey, Venezuela and Egypt (beginning in the fiscal fourth quarter of 2024) as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%.
Specifically, the Company has accounted for operations in Argentina, Turkey, Venezuela and Egypt as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%.
These circumstances can also result in damage to brand image, brand equity and consumer trust in the Company’s products. Product recalls have in the past, and could in the future, prompt government investigations and inspections, the shutdown of manufacturing facilities, continued product shortages and related sales declines, significant remediation costs, reputational damage, possible civil penalties and criminal prosecution.
Product recalls have in the past, and could in the future, prompt government investigations and inspections, the shutdown of manufacturing facilities, continued product shortages and related sales declines, significant remediation costs, reputational damage, possible civil penalties and criminal prosecution.
The Company maintains cybersecurity insurance in the event of an information security or cyber incident; however, the coverage may not be sufficient to cover all financial, legal, business or reputational losses.
The increasing use of AI and other emerging technology could also increase these risks. The Company maintains cybersecurity insurance in the event of an information security or cyber incident; however, the coverage may not be sufficient to cover all financial, legal, business or reputational losses.
Product concerns, whether raised internally or by litigants, regulators or consumer advocates, and whether or not based on scientific evidence, can result in safety alerts, product recalls, governmental investigations, regulatory action on the part of the U.S. FDA (or its counterpart in other countries), private claims and lawsuits, payment of fines and settlements, declining sales and reputational damage.
Product concerns, whether raised internally or by litigants, regulators or consumer advocates, and whether or not based on scientific evidence, can result in safety alerts, field actions, such as product recalls, governmental investigations, regulatory action on the part of the U.S.
Other risks Our business depends on our ability to recruit and retain talented and highly skilled employees. Our continued growth requires us to recruit and retain talented employees representing many different backgrounds, experiences, and skill sets.
In addition, the price of the Company's common stock may be more volatile around the time of the planned separation. Other risks Our business depends on our ability to recruit and retain talented and highly skilled employees. Our continued growth requires us to recruit and retain talented employees representing many different backgrounds, experiences, and skill sets.
Rating agencies routinely evaluate us, and their ratings of our long-term and short-term debt are based on a number of factors.
We currently maintain investment grade credit ratings with Moody’s Investors Service and Standard & Poor’s Ratings Services. Rating agencies routinely evaluate us, and their ratings of our long-term and short-term debt are based on a number of factors.
We are subject to risks associated with global health crises, epidemics, pandemics and other outbreaks (such incident(s), a health crisis or health crises).
Global health crises, pandemics, epidemics, or other outbreaks could adversely disrupt or impact certain aspects of the Company’s business, results of operations and financial condition. We are subject to risks associated with global health crises, epidemics, pandemics and other outbreaks (such incident(s), a health crisis or health crises).
While certain of the announced tariffs have been delayed, the U.S. government may in the future pause, reimpose or increase tariffs, and countries subject to such tariffs have and in the future may impose reciprocal tariffs or other restrictive trade measures in response. Any of these actions could increase uncertainties and associated risks relating to the Company’s global operations.
In addition, the U.S. government has imposed and/or announced the potential imposition of tariffs on products manufactured in other jurisdictions. 14 While certain of the announced tariffs have been delayed, the U.S. government may in the future pause, reimpose or increase tariffs, and countries subject to such tariffs have and in the future may impose reciprocal tariffs or other restrictive trade measures in response.
The industry’s failure to mitigate the threat of counterfeit medicines could adversely impact our business and reputation by impacting patient confidence in our authentic products, potentially resulting in lost sales, product recalls, and an increased threat of litigation.
The threat of counterfeit medicines could adversely impact our business and reputation by impacting patient confidence in our authentic products, potentially resulting in lost sales, product recalls, and an increased threat of litigation. In addition, diversion of our products from their authorized market into other channels may result in reduced revenues and negatively affect our profitability.
Changes in tax laws or regulations around the world, including in the U.S. and as led by the Organization for Economic Cooperation and Development, such as the enactment by certain EU and non-EU countries, and the anticipated enactment by additional countries, of a global minimum tax, could negatively impact the Company’s effective tax rate and results of operations.
Changes in tax laws or regulations in the U.S. and around the world, including global minimum taxes could negatively impact the Company’s effective tax rate and results of operations.
Weak financial performance, failure to maintain a satisfactory credit rating or disruptions in the financial markets could adversely affect our liquidity, capital position, borrowing costs and access to capital markets. We currently maintain investment grade credit ratings with Moody’s Investors Service and Standard & Poor’s Ratings Services.
Any of these actions could increase uncertainties and associated risks relating to the Company’s global operations. Weak financial performance, failure to maintain a satisfactory credit rating or disruptions in the financial markets could adversely affect our liquidity, capital position, borrowing costs and access to capital markets.
Removed
In addition, diversion of our products from their authorized market into other channels may result in reduced revenues and negatively affect our profitability. Global health crises, pandemics, epidemics, or other outbreaks could adversely disrupt or impact certain aspects of the Company’s business, results of operations and financial condition.
Added
FDA (or its counterpart in other countries), private claims and lawsuits, payment of fines and settlements, declining sales and reputational damage. These circumstances can also result in damage to brand image, brand equity and consumer trust in the Company’s products.
Removed
In addition, the U.S. government recently announced tariffs on products manufactured in several jurisdictions, including China, Mexico and Canada, and has 14 made announcements regarding the potential imposition of tariffs on other jurisdictions.
Added
Risks related to the planned separation of our Orthopaedics business The planned separation of the Company's Orthopaedics business may not be completed on the terms or timeline currently contemplated, if at all, and may not achieve the expected results In October 2025, the Company announced its intention to separate the Company's Orthopaedics business.
Added
The Company is targeting completion of the planned separation in 18 to 24 months after initial announcement.
Added
Completion of the planned separation will be subject to the satisfaction of certain conditions, including, among others, consultations with works councils and other employee representative bodies, as may be required, final approval of the Company's Board of Directors, and receipt of other regulatory approvals.
Added
There can be no assurance regarding the ultimate timing of the planned separation or that such separation will be completed. Unanticipated developments could delay, prevent or otherwise adversely affect the planned separation, including but not limited to disruptions in general or financial market conditions or potential problems or delays in obtaining various regulatory approvals or clearances.
Added
The costs to complete the planned separation will be significant. In addition, the Company may be unable to achieve some of the strategic and financial benefits that it expects to achieve from the planned separation of the Company's Orthopaedics business The Company will incur significant expenses in connection with the planned separation.
Added
In addition, the Company may not be able to achieve the full strategic and financial benefits that are expected to result from the planned separation. The anticipated benefits of the planned separation are based on a number of assumptions, some of which may prove incorrect.
Added
Following the planned separation, the price of shares of the Company's common stock may fluctuate significantly The Company cannot predict the effect of the planned separation on the trading price of shares of its common stock, and market value of shares of its common stock may be less than, equal to or greater than the market value of shares of its common stock prior to the planned separation.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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These reports include an overview of the cybersecurity threat landscape, key cybersecurity initiatives to improve the Company’s risk posture, changes in the legal and regulatory landscape relative to cybersecurity, and overviews of certain cybersecurity incidents that have occurred within the Company and within the industry. 2024 Annual Report 17
These reports include an overview of the cybersecurity threat landscape, key cybersecurity initiatives to improve the Company’s risk posture, changes in the legal and regulatory landscape relative to cybersecurity, and overviews of certain cybersecurity incidents that have occurred within the Company and within the industry. 2025 Annual Report 17

Item 2. Properties

Properties — owned and leased real estate

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Outside of the U.S., 14 facilities are used by the Innovative Medicine segment and 27 by the MedTech segment.
Outside of the U.S., 16 facilities are used by the Innovative Medicine segment and 25 by the MedTech segment.
Item 2. Properties The Company's subsidiaries operate 64 manufacturing facilities occupying approximately 9.6 million square feet of floor space.
Item 2. Properties The Company's subsidiaries operate 63 manufacturing facilities occupying approximately 10.4 million square feet of floor space.
The manufacturing facilities are used by the industry segments of the Company’s business approximately as follows: Segment Square Feet (in thousands) Innovative Medicine 4,696 MedTech 4,911 Worldwide Total 9,607 Within the U.S., four facilities are used by the Innovative Medicine segment and 19 by the MedTech segment.
The manufacturing facilities are used by the industry segments of the Company’s business approximately as follows: Segment Square Feet (in thousands) Innovative Medicine 5,245 MedTech 5,118 Worldwide Total 10,363 Within the U.S., three facilities are used by the Innovative Medicine segment and 19 by the MedTech segment.
The locations of the manufacturing facilities by major geographic areas of the world are as follows: Geographic Area Number of Facilities Square Feet (in thousands) United States 23 2,892 Europe 21 4,521 Western Hemisphere, excluding U.S. 7 898 Africa, Asia and Pacific 13 1,296 Worldwide Total 64 9,607 In addition to the manufacturing facilities discussed above, the Company maintains numerous office and warehouse facilities throughout the world.
The locations of the manufacturing facilities by major geographic areas of the world are as follows: Geographic Area Number of Facilities Square Feet (in thousands) United States 22 3,037 Europe 22 5,035 Western Hemisphere, excluding U.S. 7 1,054 Africa, Asia and Pacific 12 1,237 Worldwide Total 63 10,363 In addition to the manufacturing facilities discussed above, the Company maintains numerous office, research and development and warehouse facilities throughout the world.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Forminard joined the Company in 2006, serving in roles of increasing responsibility including General Counsel Medical Devices & Diagnostics, General Counsel Consumer Group & Supply Chain, Worldwide Vice President Corporate Governance, and in her immediate past role as General Counsel Pharmaceuticals. Kristen Mulholland, 58 Member, Executive Committee; Executive Vice President, Chief Human Resources Officer Ms. K.
Forminard joined the Company in 2006, serving in roles of increasing responsibility including General Counsel Medical Devices & Diagnostics, General Counsel Consumer Group & Supply Chain, Worldwide Vice President Corporate Governance, and in her immediate past role as General Counsel Pharmaceuticals. Kristen Mulholland, 59 Member, Executive Committee; Executive Vice President, Chief Human Resources Officer Ms. K.
During her tenure with the Company, she has held a variety of strategic leadership and executive positions, including in roles within operations, quality, engineering, new products, information technology, and other technical and business functions. Joseph J. Wolk, 58 Member, Executive Committee; Executive Vice President, Chief Financial Officer Mr. J. J.
During her tenure with the Company, she has held a variety of strategic leadership and executive positions, including in roles within operations, quality, engineering, new products, information technology, and other technical and business functions. Joseph J. Wolk, 59 Member, Executive Committee; Executive Vice President, Chief Financial Officer Mr. J. J.
Reed, M.D., Ph.D., 66 Member, Executive Committee; Executive Vice President, Innovative Medicine, R&D Dr. J. C. Reed joined the Company in 2023 as Executive Vice President, Innovative Medicine, R&D and a member of the Executive Committee. Prior to joining the Company, Dr. Reed held executive leadership positions at Sanofi (2018-2022) and Roche (2013-2018), serving on their respective executive committees.
Reed, M.D., Ph.D., 67 Member, Executive Committee; Executive Vice President, Innovative Medicine, R&D Dr. J. C. Reed joined the Company in 2023 as Executive Vice President, Innovative Medicine, R&D and a member of the Executive Committee. Prior to joining the Company, Dr. Reed held executive leadership positions at Sanofi (2018-2022) and Roche (2013-2018), serving on their respective executive committees.
She joined the Company in 2005 as Worldwide Vice President and held several executive positions of increasing responsibility in the Pharmaceuticals sector, including Company Group Chairman, North America, and Company Group Chairman, The Americas from 2012-2018. Kathryn E. Wengel, 59 Member, Executive Committee; Executive Vice President, Chief Technical Operations & Risk Officer Ms. K. E.
She joined the Company in 2005 as Worldwide Vice President and held several executive positions of increasing responsibility in the Pharmaceuticals sector, including Company Group Chairman, North America, and Company Group Chairman, The Americas from 2012-2018. Kathryn E. Wengel, 60 Member, Executive Committee; Executive Vice President, Chief Technical Operations & Risk Officer Ms. K. E.
At the annual meeting of the Board of Directors, the executive officers are elected by the Board to hold office for one year and until their respective successors are elected and qualified, or until earlier resignation or removal. Vanessa Broadhurst, 56 Member, Executive Committee; Executive Vice President, Global Corporate Affairs Ms. V.
At the annual meeting of the Board of Directors, the executive officers are elected by the Board to hold office for one year and until their respective successors are elected and qualified, or until earlier resignation or removal. Vanessa Broadhurst, 57 Member, Executive Committee; Executive Vice President, Global Corporate Affairs Ms. V.
Prior to her roles at Amgen, she served in various leadership roles at the Company from 2005-2013. Joaquin Duato, 62 Chairman of the Board; Chief Executive Officer Mr. J. Duato became Chairman of the Board of Directors in 2023 subsequent to his appointments as Chief Executive Officer and Director in 2022. Mr.
Prior to her roles at Amgen, she served in various leadership roles at the Company from 2005-2013. Joaquin Duato, 63 Chairman of the Board; Chief Executive Officer Mr. J. Duato became Chairman of the Board of Directors in 2023 subsequent to his appointments as Chief Executive Officer and Director in 2022. Mr.
(Spain), a subsidiary of the Company, and held executive positions of increasing responsibility in all business sectors and across multiple geographies and functions. Elizabeth Forminard, 54 Member, Executive Committee; Executive Vice President, Chief Legal Officer Ms. E. Forminard was appointed Executive Vice President, Chief Legal Officer and a member of the Executive Committee in 2022. Ms.
(Spain), a subsidiary of the Company, and held executive positions of increasing responsibility in all business sectors and across multiple geographies and functions. Elizabeth Forminard, 55 Member, Executive Committee; Executive Vice President, Chief Legal Officer Ms. E. Forminard was appointed Executive Vice President, Chief Legal Officer and a member of the Executive Committee in 2022. Ms.
James Swanson, 59 Member, Executive Committee; Executive Vice President, Chief Information Officer Mr. J. Swanson was appointed Executive Vice President, Chief Information Officer and a member of the Executive Committee in 2022.
James Swanson, 60 Member, Executive Committee; Executive Vice President, Chief Information Officer Mr. J. Swanson was appointed Executive Vice President, Chief Information Officer and a member of the Executive Committee in 2022.
He also served as CEO of Sanford-Burnham Medical Research Institute (now Sanford Burnham Prebys) where he established multiple therapeutic area-aligned research centers and platform technology centers. 2024 Annual Report 19 Tim Schmid, 55 Member, Executive Committee; Executive Vice President, Worldwide Chairman, MedTech Mr. T.
He also served as CEO of Sanford-Burnham Medical Research Institute (now Sanford Burnham Prebys) where he established multiple therapeutic area-aligned research centers and platform technology centers. 2025 Annual Report 19 Tim Schmid, 56 Member, Executive Committee; Executive Vice President, Worldwide Chairman, MedTech Mr. T.
Director IT and Vice President, Chief Information Officer. Jennifer L. Taubert, 61 Member, Executive Committee; Executive Vice President, Worldwide Chairman, Innovative Medicine Ms. J. L. Taubert was appointed Executive Vice President, Worldwide Chairman, Innovative Medicine (formerly Pharmaceuticals) and a member of the Executive Committee in 2018.
Director IT and Vice President, Chief Information Officer. Jennifer L. Taubert, 62 Member, Executive Committee; Executive Vice President, Worldwide Chairman, Innovative Medicine Ms. J. L. Taubert was appointed Executive Vice President, Worldwide Chairman, Innovative Medicine and a member of the Executive Committee in 2018.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Additional information called for by this item is incorporated herein by reference to the following sections of this Report: Note 16 “Common Stock, Stock Option Plans and Stock Compensation Agreements” of the Notes to Consolidated Financial Statements included in Item 8; and Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters – Equity Compensation Plan Information.” Issuer purchases of equity securities The following table provides information with respect to common stock purchases by the Company during the fiscal fourth quarter of 2024.
Additional information called for by this item is incorporated herein by reference to the following sections of this Report: Note 16 “Common Stock, Stock Option Plans and Stock Compensation Agreements” of the Notes to Consolidated Financial Statements included in Item 8; and Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters – Equity Compensation Plan Information.” Issuer purchases of equity securities The following table provides information with respect to common stock purchases by the Company during the fiscal fourth quarter of 2025.
Item 5. Market for registrant’s common equity, related stockholder matters and issuer purchases of equity securities As of February 6, 2025, there were 114,147 record holders of common stock of the Company.
Item 5. Market for registrant’s common equity, related stockholder matters and issuer purchases of equity securities As of February 4, 2026, there were 108,358 record holders of common stock of the Company.
Price Paid Per Share Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs September 30, 2024 through October 27, 2024 621,412 $163.13 — — October 28, 2024 through November 24, 2024 831,866 $158.98 — — November 25, 2024 through December 29, 2024 150,000 $152.96 — — Total 1,603,278 — (1) During the fiscal fourth quarter of 2024, the Company repurchased an aggregate of 1,603,278 shares of Johnson & Johnson Common Stock in open-market transactions, all of which were purchased as part of a systematic plan to meet the needs of the Company’s compensation programs.
Price Paid Per Share Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs September 29, 2025 through October 26, 2025 3,806,577 192.15 — — October 27, 2025 through November 23, 2025 1,690,213 193.54 — — November 24, 2025 through December 28, 2025 4,225,966 204.81 — — Total 9,722,756 — (1) During the fiscal fourth quarter of 2025, the Company repurchased an aggregate of 9,722,756 shares of Johnson & Johnson Common Stock in open-market transactions, all of which were purchased as part of a systematic plan to meet the needs of the Company’s compensation programs.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being. The Company is organized into two business segments: Innovative Medicine and MedTech. The Innovative Medicine segment is focused on the following therapeutic areas: Immunology, Infectious Diseases, Neuroscience, Oncology, Pulmonary Hypertension, and Cardiovascular and Metabolism.
The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being. The Company is organized into two business segments: Innovative Medicine and MedTech. The Innovative Medicine segment is focused on the following therapeutic areas: Oncology, Immunology, Neuroscience, Pulmonary Hypertension, Infectious Diseases, and Cardiovascular and Metabolism.
(GAAP). The preparation of these financial statements requires that management make estimates and assumptions that affect the amounts reported for revenues, expenses, assets, liabilities and other related disclosures. Actual results may or may not differ from these estimates.
The preparation of these financial statements requires that management make estimates and assumptions that affect the amounts reported for revenues, expenses, assets, liabilities and other related disclosures. Actual results may or may not differ from these estimates.
A 1% (100 basis points) change in spread on the Company’s interest rate sensitive investments would either increase or decrease the unrealized value of cash equivalents and current marketable securities by less than $8.0 million. The Company has access to substantial sources of funds at numerous banks worldwide.
A 1% (100 basis points) change in spread on the Company’s interest rate sensitive investments would either increase or decrease the unrealized value of cash equivalents and current marketable securities by less than $5.0 million. The Company has access to substantial sources of funds at numerous banks worldwide.
Through the Company's expertise in Innovative Medicine and MedTech, the Company is uniquely positioned to innovate across the full spectrum of healthcare solutions today to deliver the breakthroughs of tomorrow, and profoundly impact health for humanity. New products introduced within the past five years accounted for approximately 25% of 2024 sales.
Through the Company's expertise in Innovative Medicine and MedTech, the Company is uniquely positioned to innovate across the full spectrum of healthcare solutions today to deliver the breakthroughs of tomorrow, and profoundly impact health for humanity. New products introduced within the past five years accounted for approximately 25% of 2025 sales.
Item 7. Management’s discussion and analysis of results of operations and financial condition Organization and business segments Description of the company and business segments Johnson & Johnson and its subsidiaries (the Company) have approximately 138,100 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field.
Item 7. Management’s discussion and analysis of results of operations and financial condition Organization and business segments Description of the company and business segments Johnson & Johnson and its subsidiaries (the Company) have approximately 138,200 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field.
This ensures the Company can remain focused on addressing the unmet needs of society every day and invest for an enduring impact, ultimately delivering value to its patients, consumers and healthcare professionals, employees, communities and shareholders. 22 Research & development Acquisitions* (net of cash acquired) Dividends paid per share * Includes business combinations and asset acquisitions Results of operations Analysis of consolidated sales For discussion on results of operations and financial condition pertaining to the fiscal years 2023 and 2022 see the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, Item 7.
This ensures the Company can remain focused on addressing the unmet needs of society every day and invest for an enduring impact, ultimately delivering value to its patients, consumers and healthcare professionals, employees, communities and shareholders. 22 Research & development Acquisitions* (net of cash acquired) Dividends paid per share * Includes business combinations and asset acquisitions Results of operations Analysis of consolidated sales For discussion on results of operations and financial condition pertaining to the fiscal years 2024 and 2023 see the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2024, Item 7.
Income Taxes: Income taxes are recorded based on amounts refundable or payable for the current year and include the results of any difference between U.S. GAAP accounting and tax reporting, recorded as deferred tax assets or liabilities. The Company estimates deferred tax assets and liabilities based on enacted tax regulations and rates.
Income Taxes: Income taxes are recorded based on amounts refundable or payable for the current year and include the results of any difference between U.S. GAAP accounting and tax reporting, recorded as deferred tax assets or liabilities. The Company estimates deferred tax assets and liabilities based on enacted tax law and rates.
The decline in Advanced Surgery was primarily due to China volume-based procurement across all platforms and competitive pressures in Energy and Endocutters. This was partially offset by the strength of the portfolio and commercial execution in Biosurgery as well as the strength of new products in Endocutters.
Growth in Advanced Surgery was primarily due to the strength of the portfolio and commercial execution in Biosurgery as well as new products in Endocutters. This was partially offset by China volume-based procurement across all platforms and competitive pressures in Energy and Endocutters.
The Company records accruals for loss contingencies associated with these legal matters when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. As of December 29, 2024, the Company has determined that the liabilities associated with certain litigation matters are probable and can be reasonably estimated.
The Company records accruals for loss contingencies associated with these legal matters when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. As of December 28, 2025, the Company has determined that the liabilities associated with certain litigation matters are probable and can be reasonably estimated.
The pre-tax restructuring expense of $0.3 billion in the fiscal year 2023, of which $40 million was recorded in Restructuring and $279 million was recorded in Cost of products sold on the Consolidated Statement of Earnings, primarily included inventory and instrument charges related to market and product exits.
The pre-tax restructuring expense was $319 million in the fiscal year 2023, of which $40 million was recorded in Restructuring and $279 million was recorded in Cost of products sold on the Consolidated Statement of Earnings, primarily included inventory and instrument charges related to market and product exits.
If the Company decides at a later date to repatriate these earnings to the U.S., the Company would be required to provide for the net tax effects on these amounts. The Company estimates that the tax effect of this repatriation would be approximately $0.5 billion under currently enacted tax laws and regulations and at current currency exchange rates.
If the Company decides at a later date to repatriate these earnings to the U.S., the Company would be required to record the net tax effects on these amounts. The Company estimates that the tax effect of this repatriation would be approximately $0.6 billion under currently enacted tax laws and regulations and at current currency exchange rates.
In 2024, the net impact of acquisitions and divestitures on the MedTech segment worldwide operational sales growth was a positive 1.5% primarily related to the Shockwave acquisition.
In 2025, the net impact of acquisitions and divestitures on the MedTech segment worldwide operational sales growth was a positive 1.1% primarily related to the Shockwave acquisition.
The pre-tax restructuring expense of $0.2 billion in the fiscal year 2024, of which $132 million was recorded in Restructuring and $35 million was recorded in Cost of products sold on the Consolidated Statement of Earnings, primarily included costs related to market and product exits.
The pre-tax restructuring expense was $167 million in the fiscal year 2024, of which $132 million was recorded in Restructuring and $35 million was recorded in Cost of products sold on the Consolidated Statement of Earnings, primarily included costs related to market and product exits.
Products in this segment are distributed directly to retailers, wholesalers, distributors, hospitals and healthcare professionals for prescription use. The MedTech segment includes a broad portfolio of products used in the Orthopaedic, Surgery, Cardiovascular (previously referred to as Interventional Solutions) and Vision fields.
Products in this segment are distributed directly to retailers, wholesalers, distributors, hospitals and healthcare professionals for prescription use. The MedTech segment includes a broad portfolio of products used in the Surgery, Orthopaedic, Cardiovascular and Vision fields.
Other (Income) Expense, Net: Other (income) expense, net is the account where the Company records gains and losses related to the sale and write-down of certain investments in equity securities held by Johnson & Johnson Innovation - JJDC, Inc.
This asset is fully impaired. 30 Other (Income) Expense, Net: Other (income) expense, net is the account where the Company records gains and losses related to the sale and write-down of certain investments in equity securities held by Johnson & Johnson Innovation - JJDC, Inc.
In 2024, $17.2 billion was invested in research and development reflecting management’s commitment to create life-enhancing innovations and to create value through partnerships that will profoundly impact of health for humanity. Our approximately 138,100 employees are critical drivers of the Company’s success. Employees are empowered and inspired to lead with Our Credo and purpose as guides.
In 2025, $14.7 billion was invested in research and development reflecting management’s commitment to create life-enhancing innovations and to create value through partnerships that will profoundly impact of health for humanity. Our approximately 138,200 employees are critical drivers of the Company’s success. Employees are empowered and inspired to lead with Our Credo and purpose as guides.
The Company has not provided deferred taxes on the undistributed earnings subsequent to January 1, 2018 from certain international subsidiaries where the earnings are considered to be indefinitely reinvested. The Company intends to continue to reinvest these earnings in those international operations.
The Company has not provided deferred taxes on the undistributed earnings on certain international subsidiaries where the earnings are considered to be indefinitely reinvested. The Company intends to continue to reinvest these earnings in those international operations.
These sales changes consisted of the following: Sales increase/(decrease) due to: 2024 2023 Volume 5.9 % 6.8 % Price 0.0 0.6 Currency (1.6) (0.9) Total 4.3 % 6.5 % The net impact of acquisitions and divestitures on the worldwide sales growth was a positive impact of 0.5% in 2024 and a positive impact of 1.5% in 2023.
These sales changes consisted of the following: Sales increase/(decrease) due to: 2025 2024 Volume 8.4 % 5.9 % Price (3.1) 0.0 Currency 0.7 (1.6) Total 6.0 % 4.3 % The net impact of acquisitions and divestitures on the worldwide sales growth was a positive impact of 1.1% in 2025, primarily related to CAPLYTA and Shockwave and a positive impact of 0.5% in 2024 primarily related to Shockwave.
The sales returns reserve for the total Company has been approximately 1.0% of annual net trade sales during the fiscal years 2024, 2023 and 2022. Promotional programs, such as product listing allowances are recorded in the same period as related sales and include volume-based sales incentive programs.
The sales returns reserve for the total Company has been approximately 1.0% of annual net trade sales during the fiscal years 2025, 2024 and 2023. 36 Promotional programs are recorded in the same period as related sales and include volume-based sales incentive programs.
In June 2024, the Company secured a new 364-day Credit Facility of $10 billion, which expires on June 25, 2025. Interest charged on borrowings under the credit line agreement is based on either Secured Overnight Financing Rate (SOFR) Reference Rate or other applicable market rate as allowed plus applicable margins. Commitment fees under the agreement are not material.
In June 2025, the Company secured a new 364-day Credit Facility of $10 billion, which expires on June 24, 2026. Interest charged on borrowings under the credit line agreement is based on either Secured Overnight Financing Rate (SOFR) Reference Rate or other applicable market rate as allowed plus applicable margins.
The pre-tax restructuring charge of approximately $0.5 billion in the fiscal year 2023, of which $449 million was recorded in Restructuring and $30 million was recorded in Cost of products sold on the Consolidated Statement of Earnings, and included the termination of partnered and non-partnered program costs and asset impairments.
The pre-tax restructuring expense was $479 million in the fiscal year 2023, of which $449 million was recorded in Restructuring and $30 million was recorded in Cost of products sold on the Consolidated Statement of Earnings included the termination of partnered and non-partnered program costs and asset impairments.
Total debt represented 34.0% of total capital (shareholders’ equity and total debt) in 2024 and 30.0% of total capital in 2023. Shareholders’ equity per share at the end of 2024 was $29.70 compared to $28.57 at year-end 2023. A summary of borrowings can be found in Note 7 to the Consolidated Financial Statements.
Total debt represented 37.0% of total capital (shareholders’ equity and total debt) in 2025 and 34.0% of total capital in 2024. Shareholders’ equity per share at the end of 2025 was $33.86 compared to $29.70 at year-end 2024. A summary of borrowings can be found in Note 7 to the Consolidated Financial Statements.
Percentages in chart are as a percent to total sales) Cost of products sold and selling, marketing and administrative expenses: Cost of products sold Selling, marketing & administrative (Dollars in billions.
Earnings before provision for taxes (Dollars in billions. Percentages in chart are as a percent to total sales) Cost of products sold and selling, marketing and administrative expenses: Cost of products sold Selling, marketing & administrative (Dollars in billions.
Dollar from the December 29, 2024 market rates would increase the unrealized value of the Company’s forward contracts by $0.2 billion. Conversely, a 10% depreciation of the U.S. Dollar from the December 29, 2024 market rates would decrease the unrealized value of the Company’s forward contracts by $0.2 billion.
Dollar from the December 28, 2025 market rates would increase the unrealized value of the Company’s forward contracts by approximately $0.2 billion. Conversely, a 10% depreciation of the U.S. Dollar from the December 28, 2025 market rates would decrease the unrealized value of the Company’s forward contracts by approximately $0.3 billion.
The ten-year compound annual growth rates for worldwide, U.S. and international sales were 4.0%, 5.4% and 2.5%, respectively. 2024 Annual Report 23 In 2024, sales by companies in Europe experienced a decline of 1.0% as compared to the prior year, which included an operational decline of 0.6% and a negative currency impact of 0.4%.
The ten-year compound annual growth rates for worldwide, U.S. and international sales were 5.2%, 5.8% and 4.5%, respectively. 2025 Annual Report 23 In 2025, sales by companies in Europe achieved growth of 6.5% as compared to the prior year, which included operational growth of 2.4% and a positive currency impact of 4.1%.
Dollar as compared to all foreign currencies in which the Company had sales, income or expense in 2024 would have increased or decreased the translation of foreign sales by approximately $0.4 billion and net income by approximately $0.1 billion.
A 1% change in the value of the U.S. Dollar as compared to all foreign currencies in which the Company had sales, income or expense in 2025 would have increased or decreased the translation of foreign sales by approximately $0.4 billion and net income by approximately $0.2 billion.
For the proposed talc settlement payments, see Note 19 to the Consolidated Financial Statements. 2024 Annual Report 35 Financing and market risk The Company uses financial instruments to manage the impact of foreign exchange rate changes on cash flows.
For talc matters, see Note 19 to the Consolidated Financial Statements. Financing and market risk The Company uses financial instruments to manage the impact of foreign exchange rate changes on cash flows.
The total debt balance at the end of 2024 was $36.6 billion with an average debt balance of $33.0 billion as compared to $29.3 billion at the end of 2023 and an average debt balance of $34.5 billion. The higher debt balance was due to the senior unsecured notes issued by the Company in the fiscal second quarter of 2024.
The total debt balance at the end of 2025 was $47.9 billion with an average debt balance of $42.3 billion as compared to $36.6 billion at the end of 2024 and an average debt balance of $33.0 billion. The higher debt balance was due to the senior unsecured notes issued by the Company in the fiscal first quarter of 2025.
In the face of increasing costs, the Company strives to maintain its profit margins through cost reduction programs, productivity improvements and periodic price increases. In July 2023, Janssen Pharmaceuticals, Inc. (Janssen) filed litigation against the U.S.
This did not have a material impact to the Company's results in the period. In the face of increasing costs, the Company strives to maintain its profit margins through cost reduction programs, productivity improvements and periodic price increases. In July 2023, Janssen Pharmaceuticals, Inc. (Janssen) filed litigation against the U.S.
The primary sources and uses of cash that contributed to the $2.2 billion increase were: (Dollars in billions) $21.9 Q4 2023 Cash and cash equivalents balance 24.3 cash generated from operating activities (18.6) net cash used by investing activities (3.1) net cash used by financing activities (0.4) effect of exchange rate and rounding $24.1 Q4 2024 Cash and cash equivalents balance In addition, the Company had $0.4 billion in marketable securities at the end of fiscal year 2024 and $1.1 billion at the end of fiscal year 2023.
The primary sources and uses of cash that contributed to the $4.4 billion decrease were: (Dollars in billions) $24.1 Q4 2024 Cash and cash equivalents balance 24.5 cash generated from operating activities (23.6) net cash used for investing activities (5.5) net cash used for financing activities 0.2 effect of exchange rate and rounding $19.7 Q4 2025 Cash and cash equivalents balance In addition, the Company had $0.4 billion in marketable securities at the end of fiscal year 2025 and $0.4 billion at the end of fiscal year 2024.
Liquidity and capital resources Liquidity & cash flows Cash and cash equivalents were $24.1 billion at the end of 2024 as compared to $21.9 billion at the end of 2023.
Liquidity and capital resources Liquidity & cash flows Cash and cash equivalents were $19.7 billion at the end of 2025 as compared to $24.1 billion at the end of 2024.
In 2023, the Company had three wholesalers distributing products for both segments that represented approximately 18.2%, 15.1% and 14.2% of the total gross revenues. 2024 Sales by geographic region (in billions) 2024 Sales by segment (in billions) Note: values may have been rounded Analysis of sales by business segments Innovative Medicine segment Innovative Medicine segment sales in 2024 were $57.0 billion, an increase of 4.0% from 2023, which included operational growth of 5.7% and a negative currency impact of 1.7%.
In 2024, the Company had three wholesalers distributing products for both segments that represented approximately 20.5%, 15.6% and 12.3% of the total gross revenues. 2025 Sales by geographic region (in billions) 2025 Sales by segment (in billions) Note: values may have been rounded *operational excludes the effect of translational currency Analysis of sales by business segments Innovative Medicine segment Innovative Medicine segment sales in 2025 were $60.4 billion, an increase of 6.0% from 2024, which included operational growth of 5.3% and a positive currency impact of 0.7%.
U.S. sales were $16.3 billion, an increase of 6.9% as compared to the prior year. International sales were $15.5 billion, an increase of 2.6% as compared to the prior year, which included operational growth of 5.4% and a negative currency impact of 2.8%.
U.S. sales were $17.4 billion, an increase of 6.6% as compared to the prior year. International sales were $16.4 billion, an increase of 5.5% as compared to the prior year, which included operational growth of 4.1% and a positive currency impact of 1.4%.
Competition exists in all product lines without regard to the number and size of the competing companies involved. Competition in research, involving the development and the improvement of new and existing products and processes, is particularly significant.
In all of its product lines, the Company competes with other companies both locally and globally, throughout the world. Competition exists in all product lines without regard to the number and size of the competing companies involved. Competition in research, involving the development and the improvement of new and existing products and processes, is particularly significant.
Sales by companies in the Asia-Pacific, Africa region experienced a decline of 1.2% as compared to the prior year, including operational growth of 2.3% offset by a negative currency impact of 3.5%. In 2024, the Company utilized three wholesalers distributing products for both segments that represented approximately 20.5%, 15.6% and 12.3% of the total gross revenues.
Sales by companies in the Asia-Pacific, Africa region achieved growth of 3.2% as compared to the prior year, including operational growth of 3.1% and a positive currency impact of 0.1%. In 2025, the Company utilized three wholesalers distributing products for both segments that represented approximately 21.8%, 15.5% and 11.1% of the total gross revenues.
The impact of the IRA on our business and the broader pharmaceutical industry remains uncertain, as litigation filed by Janssen and other pharmaceutical companies remains ongoing and while CMS has publicly announced the maximum fair price for each of the selected drugs, implementation of the program is still in progress.
While the impact of the IRA on our business and the broader pharmaceutical industry remains uncertain, as litigation filed by Janssen and other pharmaceutical companies remains ongoing, CMS has publicly announced the maximum fair price for each of the selected drugs and has recently begun implementing the program. In December 2025, Janssen sought review by the U.S.
Common stock The Company’s Common Stock is listed on the New York Stock Exchange under the symbol JNJ. As of February 6, 2025, there were 114,147 record holders of Common Stock of the Company.
Common stock The Company’s Common Stock is listed on the New York Stock Exchange under the symbol JNJ. As of February 4, 2026, there were 108,358 record holders of Common Stock of the Company.
The Company anticipates that operating cash flows, the ability to raise funds from external sources, borrowing capacity from existing committed credit facilities and access to the commercial paper markets will continue to provide sufficient resources to fund operating needs, including the Company's remaining balance to be paid on the agreement to settle opioid litigation for approximately $1.5 billion and the approximately $11.6 billion ($13.5 billion nominal) reserve for talc matters (See Note 19 to the Consolidated Financial Statements for additional details).
The Company anticipates that operating cash flows, the ability to raise funds from external sources, borrowing capacity from existing committed credit facilities and access to the commercial paper markets will continue to provide sufficient resources to fund operating needs, including the Company’s reserve balance of approximately $3.4 billion related to talc matters, $2.0 billion related to the current portion of Corporate bonds due and the remaining 34 approximately $1.1 billion to settle opioid litigation (See Note 19 to the Consolidated Financial Statements for additional details).
These products are distributed to wholesalers, hospitals and retailers, and used principally in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics.
These products are distributed to wholesalers, hospitals and retailers, and used principally in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics. In October 2025, the Company announced its intention to separate its Orthopaedics business.
Cash flow from operations of $24.3 billion was the result of: (Dollars In billions) $14.1 Net Earnings 8.4 non-cash expenses and other adjustments primarily for depreciation and amortization, stock-based compensation, asset write-downs and charges for acquired in-process research and development assets partially offset by net gain on sale of assets/businesses and the deferred tax provision 1.7 a decrease in other current and non-current assets 1.6 an increase in accounts payable and accrued liabilities (1.5) an increase in accounts receivable and inventories $24.3 Cash flow from operations 2024 Annual Report 33 Cash flow used for investing activities of $18.6 billion was primarily due to: (Dollars in billions) $(4.4) additions to property, plant and equipment (15.1) acquisitions, net of cash acquired 0.7 proceeds from the disposal of assets/businesses, net (1.8) acquired in-process research and development assets 0.7 net sales of investments 1.5 credit support agreements activity, net (0.2) other (including capitalized licenses and milestones) $(18.6) Net cash used for investing activities Cash flow used for financing activities of $3.1 billion was primarily due to: (Dollars in billions) $(11.8) dividends to shareholders (2.4) repurchase of common stock 11.0 net proceeds from short and long-term debt 0.8 proceeds from stock options exercised/employee withholding tax on stock awards, net 0.3 credit support agreements activity, net (1.0) settlement of convertible debt acquired from Shockwave $(3.1) Net cash used for financing activities The following table summarizes cash taxes paid net of refunds: (Dollars in Millions) 2024 2023 2022 U.S.
See Note 1 to the Consolidated Financial Statements for additional details on cash, cash equivalents and marketable securities. 2025 Annual Report 33 Cash flow from operations of $24.5 billion was the result of: (Dollars In billions) $26.8 Net Earnings 10.4 non-cash expenses and other adjustments primarily for depreciation and amortization, stock-based compensation, asset write-downs, charges for acquired in-process research and development and deferred tax provision partially offset by net gain on sale of assets/businesses (6.2) an increase in other current and non-current assets (5.7) a decrease in other current and non-current liabilities 2.4 an increase in accounts payable and accrued liabilities (3.2) an increase in accounts receivable and inventories $24.5 Cash flow from operations Cash flow used for investing activities of $23.6 billion was primarily due to: (Dollars in billions) $(4.8) additions to property, plant and equipment (17.5) acquisitions, net of cash acquired 0.7 proceeds from the disposal of assets/businesses, net (0.4) acquired in-process research and development /related milestones 0.7 net sales of investments (2.1) credit support agreements activity, net (0.2) other (including capitalized licenses and milestones) $(23.6) Net cash used for investing activities Cash flow used for financing activities of $5.5 billion was primarily due to: (Dollars in billions) $(12.4) dividends to shareholders (6.0) repurchase of common stock 9.6 net proceeds from short and long-term debt 3.4 proceeds from stock options exercised/employee withholding tax on stock awards, net (0.2) credit support agreements activity, net 0.1 other and rounding $(5.5) Net cash used for financing activities As of December 28, 2025, the Company's notes payable and long-term debt was in excess of cash, cash equivalents and marketable securities.
As of December 29, 2024, the net debt position was $12.1 billion as compared to the prior year of $6.4 billion. The debt balance at the end of 2024 was $36.6 billion as compared to $29.3 billion in 2023. In the fiscal second quarter of 2024, the Company issued senior unsecured notes for a total of $6.7 billion.
As of December 28, 2025, the net debt position was $27.8 billion as compared to the prior year of $12.1 billion. The debt balance at the end of 2025 was $47.9 billion as compared to $36.6 billion in 2024. In the fiscal first quarter of 2025, the Company issued senior unsecured notes for a total of $9.2 billion.
FDA or otherwise challenged the coverage and/or validity of the Company's patents, seeking to market generic or biosimilar forms of many of the Company’s key pharmaceutical products prior to expiration of the applicable patents covering those products.
Firms have filed Abbreviated New Drug Applications or Biosimilar Biological Product Applications with the U.S. FDA or otherwise challenged the coverage and/or validity of the Company's patents, seeking to market generic or biosimilar forms of many of the Company’s key pharmaceutical products prior to expiration of the applicable patents covering those products.
In addition to accruals in the self insurance program, claims that exceed the insurance coverage are accrued when losses are probable and amounts can be reasonably estimated. The Company follows the provisions of U.S. GAAP when recording litigation related contingencies.
In addition to accruals in the self insurance program, claims that exceed the insurance coverage are accrued when losses are probable and amounts can be reasonably estimated.
Selling, Marketing and Administrative expense: Selling, Marketing and Administrative Expenses increased as a percent to sales driven by: • Increased commercial investment in the Innovative Medicine business partially offset by • Optimization efforts related to the residual costs associated with the Kenvue separation Research and Development expense: Research and development expense by segment of business was as follows: 2024 2023 (Dollars in Millions) Amount % of Sales* Amount % of Sales* Innovative Medicine $13,529 23.8 % $11,963 21.8 % MedTech 3,703 11.6 3,122 10.3 Total research and development expense $17,232 19.4 % $15,085 17.7 % Percent increase/(decrease) over the prior year 14.2 % 6.7 % *As a percent to segment sales Research and development activities represent a significant part of the Company's business.
Selling, Marketing and Administrative expense: Selling, Marketing and Administrative Expenses decreased as a percent to sales driven by: • Corporate administrative expense rationalization • Planned leverage in the Innovative Medicine business partially offset by • Increased investment related to the acquisition of Intra-Cellular (CAPLYTA) Research and Development expense: Research and development expense by segment of business was as follows: 2025 2024 (Dollars in Millions) Amount % of Sales* Amount % of Sales* Innovative Medicine $11,827 19.6 % $13,529 23.8 % MedTech 2,838 8.4 3,703 11.6 Total research and development expense $14,665 15.6 % $17,232 19.4 % Percent increase/(decrease) over the prior year (14.9 %) 14.2 % *As a percent to segment sales Research and development activities represent a significant part of the Company's business.
Research and Development increased as a percent to sales primarily driven by: • Acquired in-process research & development expense of $1.25 billion to secure the global rights to the NM26 bispecific antibody (Yellow Jersey acquisition) and pipeline advancement in the Innovative Medicine business • Acquired in-process research & development expense of $0.5 billion from the V-Wave acquisition in the MedTech business In-Process Research and Development Impairments (IPR&D): In the fiscal year 2024, the Company recorded a charge of approximately $0.2 billion associated with the M710 (biosimilar) asset acquired as part of the acquisition of Momenta Pharmaceuticals in 2020.
Research and Development decreased as a percent to sales primarily driven by: • Acquired in-process research & development expense of $1.25 billion to secure the global rights to the NM26 bispecific antibody (Yellow Jersey acquisition) in the Innovative Medicine business in 2024 • Acquired in-process research & development expense of $0.5 billion from the V-Wave acquisition and a Laminar milestone of $0.3 billion in the MedTech business in 2024 • Leverage resulting from investment prioritization in the Innovative Medicine business In-Process Research and Development Impairments (IPR&D): In the fiscal year 2025, the Company recorded a charge of approximately $0.1 billion primarily related to a non-strategic asset acquired with Abiomed in 2022.
Several EU and non-EU countries have enacted Pillar Two legislation with an initial effective date of January 1, 2024, with other aspects of the law effective in 2025 or later. In the fiscal year 2024, the net impact of Pillar Two legislation was less than 1.0% to the Company’s effective tax rate.
Several EU and non-EU countries have enacted Pillar Two legislation with an initial effective date of January 1, 2024, with other aspects of the law effective in 2025 or later. While countries continue to enact new provisions or issue new regulations this could have an impact to the Company’s effective tax rate.
The pre-tax restructuring charge of approximately $0.1 billion in the fiscal year 2024 was recorded in Restructuring on the Consolidated Statement of Earnings, and included the termination of partnered and non-partnered development program costs, asset impairments and asset divestments.
This resulted in the exit of certain programs within therapeutic areas. The pre-tax restructuring charge of $102 million in the fiscal year 2024 was recorded in Restructuring on the Consolidated Statement of Earnings, and included the termination of partnered and non-partnered development program costs, asset impairments and asset divestments.
Long-Lived and Intangible Assets: The Company assesses changes, both qualitatively and quantitatively, in economic conditions and makes assumptions regarding estimated future cash flows in evaluating the value of the Company’s property, plant and equipment, goodwill and intangible assets.
See Notes 1 and 19 to the Consolidated Financial Statements for further information regarding product liability and legal proceedings. 38 Long-Lived and Intangible Assets: The Company assesses changes, both qualitatively and quantitatively, in economic conditions and makes assumptions regarding estimated future cash flows in evaluating the value of the Company’s property, plant and equipment, goodwill and intangible assets.
Income before tax by segment Income (loss) before tax by segment of business were as follows: Income Before Tax Segment Sales Percent of Segment Sales (Dollars in Millions) 2024 2023 2024 2023 2024 2023 Innovative Medicine $18,919 18,246 56,964 54,759 33.2 % 33.3 MedTech 3,740 4,669 31,857 30,400 11.7 15.4 Segment earnings before tax (1) 22,659 22,915 88,821 85,159 25.5 26.9 Less: Expenses not allocated to segments (2) 5,972 7,853 Worldwide income before tax $16,687 15,062 88,821 85,159 18.8 % 17.7 (1) See Note 17 to the Consolidated Financial Statements for more details.
Income before tax by segment Income before tax by segment of business was as follows: Income Before Tax Segment Sales Percent of Segment Sales (Dollars in Millions) 2025 2024 2025 2024 2025 2024 Innovative Medicine $ 22,266 18,919 60,401 56,964 36.9 % 33.2 MedTech 4,113 3,740 33,792 31,857 12.2 11.7 Segment earnings before tax (1) 26,379 22,659 94,193 88,821 28.0 25.5 (Income) Expenses not allocated to segments (2) (6,202) 5,972 Worldwide income before tax $ 32,581 16,687 94,193 88,821 34.6 % 18.8 (1) See Note 17 to the Consolidated Financial Statements for more details.
The net proceeds from this offering were used to fund the Shockwave acquisition which closed on May 31, 2024 and for general corporate purposes.
The net proceeds from this offering were used to fund the Intra-Cellular Therapies, Inc. acquisition which closed on April 2, 2025 and for general corporate purposes.
In fiscal 2024, the net impact of the Covid-19 Vaccine on the European regions change in operational sales was a negative 4.7%. Sales by companies in the Western Hemisphere, excluding the U.S., achieved growth of 3.6% as compared to the prior year, which included operational growth of 20.4%, and a negative currency impact of 16.8%.
Sales by companies in the Western Hemisphere, excluding the U.S., achieved growth of 3.4% as compared to the prior year, which included operational growth of 8.4%, and a negative currency impact of 5.0%.
This policy impacts contract pharmacy transactions involving non-grantee 340B covered entities for most of the Company’s drugs, subject to multiple exceptions. Both grantee and non-grantee covered entities can maintain certain contract pharmacy arrangements under policy exceptions.
The Company maintains a policy that no end customer will be permitted direct delivery of product to a location other than the billing location. This policy impacts contract pharmacy transactions involving non-grantee 340B covered entities for most of the Company’s drugs, subject to multiple exceptions. Both grantee and non-grantee covered entities can maintain certain contract pharmacy arrangements under policy exceptions.
In the Company's opinion, based on its examination of these matters, its experience to date and discussions with counsel, the ultimate outcome of legal proceedings, net of liabilities accrued in the Company's balance sheet, is not expected to have a material adverse effect on the Company's financial position.
To the extent adverse awards, judgments or verdicts have been rendered against the Company, the Company does not record an accrual until a loss is determined to be probable and can be reasonably estimated. 40 In the Company's opinion, based on its examination of these matters, its experience to date and discussions with counsel, the ultimate outcome of legal proceedings, net of liabilities accrued in the Company's balance sheet, is not expected to have a material adverse effect on the Company's financial position.
Sales of CARVYKTI (ciltacabtagene autoleucel) were driven by continued share gains, capacity expansion and manufacturing efficiencies. Additionally, sales from the ongoing launches of TECVAYLI (teclistamab-cqyv), TALVEY (talquetamab-tgvs) and RYBREVANT (amivantamab), included in Other Oncology, contributed to the growth. Growth was partially offset by ZYTIGA (abiraterone acetate) due to loss of exclusivity and IMBRUVICA (ibrutinib) due to global competitive pressures.
Additionally, sales from the ongoing launches and share gains of TECVAYLI (teclistamab-cqyv), TALVEY (talquetamab-tgvs) and RYBREVANT (amivantamab)/LAZCLUZE (lazertinib) contributed to the growth. Growth was partially offset by ZYTIGA (abiraterone acetate) due to loss of exclusivity and IMBRUVICA (ibrutinib) due to competitive pressures and the impact of Medicare Part D redesign.
Sales by U.S. companies were $50.3 billion in 2024 and $46.4 billion in 2023. This represents increases of 8.3% in 2024 and 10.6% in 2023. In the fiscal 2024, acquisitions and divestitures had a net positive impact of 0.7% on the U.S. operational sales growth. Sales by international companies were $38.5 billion in 2024 and $38.7 billion in 2023.
Sales by U.S. companies were $53.8 billion in 2025 and $50.3 billion in 2024. This represents increases of 6.9% in 2025 and 8.3% in 2024. In the fiscal year 2025, acquisitions and divestitures had a net positive impact of 2.0% on the U.S. sales growth primarily related to CAPLYTA and Shockwave.
Cash, cash equivalents and marketable securities totaled $24.5 billion at the end of 2024, and averaged $23.7 billion as compared to the cash, cash equivalents and marketable securities total of $22.9 billion and $22.6 billion average balance in 2023.
Interest expense was higher as compared to the prior year due to a higher average debt balance. Cash, cash equivalents and marketable securities totaled $20.1 billion at the end of 2025, and averaged $22.3 billion as compared to the cash, cash equivalents and marketable securities total of $24.5 billion and $23.7 billion average balance in 2024.
Total project costs of approximately $0.6 billion have been recorded since the restructuring was announced. The program was completed in the fiscal fourth quarter of 2024. 32 In the fiscal year 2023, the Company initiated a restructuring program of its Orthopaedics franchise within the MedTech segment to streamline operations by exiting certain markets, product lines and distribution network arrangements.
In fiscal 2023, the Company initiated a restructuring program of its Orthopaedics franchise within its MedTech segment to streamline operations by exiting certain markets, product lines and distribution network arrangements.
U.S. sales were $34.0 billion, an increase of 9.0%. International sales were $23.0 billion, a decrease of 2.5%, which included operational growth of 1.3% offset by a negative currency impact of 3.8%. In 2024, acquisitions and divestitures had a net negative impact of 0.1% on the operational sales growth of the worldwide Innovative Medicine segment.
U.S. sales were $36.3 billion, an increase of 7.0%. International sales were $24.1 billion, an increase of 4.6%, which included operational growth of 2.9% and a positive currency impact of 1.7%. In 2025, the net impact of acquisitions and divestitures on the worldwide Innovative Medicine segment operational sales growth was a positive 1.2%, related to CAPLYTA.
As a percent to sales, consolidated earnings before provision for taxes on income was 18.8% and 17.7%, in 2024 and 2023, respectively. Earnings before provision for taxes (Dollars in billions.
Analysis of consolidated earnings before provision for taxes on income Consolidated earnings before provision for taxes on income was $32.6 billion and $16.7 billion for the years 2025 and 2024, respectively. As a percent to sales, consolidated earnings before provision for taxes on income was 34.6% and 18.8%, in 2025 and 2024, respectively.
(2) Includes prior period adjustments 38 MedTech segment (Dollars in Millions) Balance at Beginning of Period Accruals Payments/ Credits Balance at End of Period 2024 Accrued rebates (1) $1,455 5,955 (5,986) 1,424 Accrued returns 125 543 (550) 118 Accrued promotions 25 62 (65) 22 Subtotal $1,605 6,560 (6,601) 1,564 Reserve for doubtful accounts 133 31 (38) 126 Reserve for cash discounts 5 92 (91) 6 Total $1,743 6,683 (6,730) 1,696 2023 Accrued rebates (1) $1,470 6,241 (6,256) 1,455 Accrued returns 134 555 (564) 125 Accrued promotions 43 74 (92) 25 Subtotal $1,647 6,870 (6,912) 1,605 Reserve for doubtful accounts 125 33 (25) 133 Reserve for cash discounts 9 96 (100) 5 Total $1,781 6,999 (7,037) 1,743 (1) Includes reserve for customer rebates of $704 million at December 29, 2024 and $740 million at December 31, 2023, recorded as a contra asset.
(2) Includes adjustments to revenue recognized as a result of changes in estimates for prior year transactions 2025 Annual Report 37 MedTech segment (Dollars in Millions) Balance at Beginning of Period Accruals Payments/ Credits Balance at End of Period 2025 Accrued rebates (1) $1,424 6,446 (6,377) 1,493 Accrued returns 118 548 (538) 128 Accrued promotions 22 88 (86) 24 Subtotal $1,564 7,082 (7,001) 1,645 Reserve for doubtful accounts 126 33 (14) 145 Reserve for cash discounts 6 89 (88) 7 Total $1,696 7,204 (7,103) 1,797 2024 Accrued rebates (1) $1,455 5,955 (5,986) 1,424 Accrued returns 125 543 (550) 118 Accrued promotions 25 62 (65) 22 Subtotal $1,605 6,560 (6,601) 1,564 Reserve for doubtful accounts 133 31 (38) 126 Reserve for cash discounts 5 92 (91) 6 Total $1,743 6,683 (6,730) 1,696 (1) Includes reserve for customer rebates of $767 million at December 28, 2025 and $704 million at December 29, 2024, recorded as a contra asset.
Innovative Medicine segment (Dollars in Millions) Balance at Beginning of Period Accruals Payments/ Credits (2) Balance at End of Period 2024 Accrued rebates (1) $14,661 52,786 (51,667) 15,780 Accrued returns 634 845 (355) 1,124 Accrued promotions 6 3 (6) 3 Subtotal $15,301 53,634 (52,028) 16,907 Reserve for doubtful accounts 33 14 (6) 41 Reserve for cash discounts 111 1,493 (1,495) 109 Total $15,445 55,141 (53,529) 17,057 2023 Accrued rebates (1) $12,289 47,523 (45,151) 14,661 Accrued returns 649 332 (347) 634 Accrued promotions 1 12 (7) 6 Subtotal $12,939 47,867 (45,505) 15,301 Reserve for doubtful accounts 44 0 (11) 33 Reserve for cash discounts 110 1,386 (1,385) 111 Total $13,093 49,253 (46,901) 15,445 (1) Includes reserve for customer rebates of $187 million at December 29, 2024 and $165 million at December 31, 2023, recorded as a contra asset.
Innovative Medicine segment (Dollars in Millions) Balance at Beginning of Period Accruals Payments/ Credits (2) Balance at End of Period 2025 Accrued rebates (1) $15,780 56,819 (55,071) 17,528 Accrued returns 1,124 197 (341) 980 Accrued promotions 3 1 (4) 0 Subtotal $16,907 57,017 (55,416) 18,508 Reserve for doubtful accounts 41 0 (3) 38 Reserve for cash discounts 109 1,314 (1,300) 123 Total $17,057 58,331 (56,719) 18,669 2024 Accrued rebates (1) $14,661 52,786 (51,667) 15,780 Accrued returns 634 845 (355) 1,124 Accrued promotions 6 3 (6) 3 Subtotal $15,301 53,634 (52,028) 16,907 Reserve for doubtful accounts 33 14 (6) 41 Reserve for cash discounts 111 1,493 (1,495) 109 Total $15,445 55,141 (53,529) 17,057 (1) Includes reserve for customer rebates of $262 million at December 28, 2025 and $187 million at December 29, 2024, recorded as a contra asset.
Major MedTech franchise sales: (Dollars in Millions) 2024 2023 Total Change Operations Change Currency Change Surgery $9,845 10,037 (1.9) % 0.1 % (2.0) % Advanced 4,488 4,671 (3.9) (2.0) (1.9) General 5,358 5,366 (0.2) 2.0 (2.2) Orthopaedics 9,158 8,942 2.4 3.0 (0.6) Hips 1,638 1,560 5.0 5.6 (0.6) Knees 1,545 1,456 6.1 6.5 (0.4) Trauma 3,049 2,979 2.3 2.9 (0.6) Spine, Sports & Other 2,926 2,947 (0.7) (0.1) (0.6) Cardiovascular (1) 7,707 6,350 21.4 22.8 (1.4) Electrophysiology 5,267 4,688 12.3 14.0 (1.7) Abiomed 1,496 1,306 14.5 14.9 (0.4) Shockwave (2) 564 — * * — Other Cardiovascular 380 356 6.9 8.4 (1.5) Vision 5,146 5,072 1.5 3.0 (1.5) Contact Lenses/Other 3,733 3,702 0.8 2.6 (1.8) Surgical 1,413 1,370 3.2 4.3 (1.1) Total MedTech Sales $31,857 30,400 4.8 % 6.2 % (1.4) % (1) Previously referred to as Interventional Solutions (2) Acquired on May 31, 2024 * Percentage greater than 100% or not meaningful The Surgery franchise sales were $9.8 billion in 2024, representing a decrease of 1.9% from 2023.
Major MedTech franchise sales: (Dollars in Millions) 2025 2024 Total Change Operations Change Currency Change Surgery $10,137 9,845 3.0 % 2.5 % 0.5 % Advanced 4,577 4,488 2.0 1.5 0.5 General 5,560 5,358 3.8 3.3 0.5 Orthopaedics 9,258 9,158 1.1 0.3 0.8 Hips 1,674 1,638 2.1 1.4 0.7 Knees 1,587 1,545 2.7 2.0 0.7 Trauma 3,146 3,049 3.2 2.4 0.8 Spine, Sports & Other 2,852 2,926 (2.5) (3.5) 1.0 Cardiovascular 8,928 7,707 15.8 15.2 0.6 Electrophysiology 5,634 5,267 7.0 6.4 0.6 Abiomed 1,751 1,496 17.1 16.2 0.9 Shockwave (1) 1,146 564 * * * Other Cardiovascular 397 380 4.3 3.8 0.5 Vision 5,468 5,146 6.3 5.3 1.0 Contact Lenses/Other 3,910 3,733 4.8 3.6 1.2 Surgical 1,558 1,413 10.2 9.9 0.3 Total MedTech Sales $33,792 31,857 6.1 % 5.4 % 0.7 % (1) Acquired on May 31, 2024 * Percentage greater than 100% or not meaningful The Surgery franchise achieved sales of $10.1 billion in 2025, representing an increase of 3.0% from 2024.
Within the strategic parameters provided by the Executive Committee, senior management groups at U.S. and international operating companies are each responsible for their own strategic plans and the day-to-day operations of those companies. In all of its product lines, the Company competes with other companies both locally and globally, throughout the world.
The Executive Committee is Johnson & Johnson’s senior leadership team responsible for setting the strategy and priorities of the Company and driving accountability at all levels. Within the strategic parameters provided by the Executive Committee, senior management groups at U.S. and international operating companies are each responsible for their own strategic plans and the day-to-day operations of those companies.
Percentages in chart are as a percent to total sales) 2024 Annual Report 29 Cost of products sold: Cost of products sold decreased as a percent to sales driven by: • Lower one-time COVID-19 vaccine supply network related exit costs in 2024 ($0 in 2024 versus $0.2 billion 2023) in the Innovative Medicine business • Prior year restructuring related excess inventory costs in the MedTech business partially offset by • The fair value Inventory step-up of $0.4 billion related to the business combination accounting associated with Shockwave The intangible asset amortization expense included in cost of products sold was $4.5 billion for both fiscal years 2024 and 2023.
Percentages in chart are as a percent to total sales) 2025 Annual Report 29 Cost of products sold: Cost of products sold increased as a percent to sales driven by: • Unfavorable product mix driven by the decline of STELARA sales and unfavorable transactional currency in the Innovative Medicine business • Tariffs, unfavorable transactional currency and macroeconomic factors in the MedTech business partially offset by • Non-recurring, acquisition related fair value Inventory step-up of $0.1 billion in 2025 versus $0.4 billion in 2024 related to the business combination accounting associated with the Shockwave acquisition in the MedTech business The intangible asset amortization expense included in cost of products sold was $4.6 billion in fiscal 2025 and $4.5 billion in fiscal 2024.
In response to these concerns, the Company has a long-standing policy of pricing products responsibly. For the period 2014 - 2024, in the U.S., the weighted average compound annual growth rate of the Company’s net price increases for healthcare products (prescription and over-the-counter drugs, hospital and professional products) was below the U.S. Consumer Price Index (CPI).
For the period 2015 - 2025, in the U.S., the weighted average compound annual growth rate of the Company’s net price increases for healthcare products (prescription and over-the-counter drugs, hospital and professional products) was below the U.S. Consumer Price Index (CPI). The Company operates in certain countries where the economic conditions continue to present significant challenges.
Growth in General Surgery was primarily driven by technology penetration and benefits from the differentiated Wound Closure portfolio as well as increased procedure volume. This growth was offset by the negative impact of currency and the Acclarent divestiture. The Orthopaedics franchise sales were $9.2 billion in 2024, representing an increase of 2.4% from 2023.
Growth in General Surgery was primarily driven by technology penetration and upgrades within the differentiated Wound Closure portfolio. This growth was partially offset by the impact from divestitures. The Orthopaedics franchise achieved sales of $9.3 billion in 2025, representing an increase of 1.1% from 2024.
Total project costs of approximately $0.5 billion have been recorded since the restructuring was announced. See Note 20 to the Consolidated Financial Statements for additional details related to the restructuring programs. Provision for Taxes on Income: The worldwide effective income tax rate from continuing operations was 15.7% in 2024 and 11.5% in 2023.
Total project costs of approximately $0.6 billion have been recorded since the restructuring was announced and the program was completed in the fiscal fourth quarter of 2024. See Note 20 to the Consolidated Financial Statements for additional details related to the restructuring programs.
On January 2, 2025, the Board of Directors declared a regular cash dividend of $1.24 per share, payable on March 4, 2025 to shareholders of record as of February 18, 2025. 36 Other information Critical accounting policies and estimates Management’s discussion and analysis of results of operations and financial condition are based on the Company’s consolidated financial statements that have been prepared in accordance with accounting principles generally accepted in the U.S.
Other information Critical accounting policies and estimates Management’s discussion and analysis of results of operations and financial condition are based on the Company’s consolidated financial statements that have been prepared in accordance with accounting principles generally accepted in the U.S. (GAAP).
The growth in Hips reflects continued strength of the portfolio primarily in the Anterior approach, and global procedure growth. The growth in Knees was primarily driven by the ATTUNE portfolio, pull through related to the VELYS Robotic assisted solution and global procedure growth. Growth in Trauma was driven by the adoption of recently launched products.
The growth in Knees was primarily driven by the ATTUNE portfolio, pull through related to the VELYS Robotic assisted solution. Growth in Trauma was driven by the adoption of recently launched products and commercial execution. The decline in Spine, Sports & Other was primarily driven by competitive pressures and price pressures in the U.S.
Management's discussion and analysis of results of operations and financial condition. Prior periods disclosed herein were recast to reflect the continuing operations of the Company. In 2024, worldwide sales increased 4.3% to $88.8 billion as compared to an increase of 6.5% in 2023.
Management's discussion and analysis of results of operations and financial condition. In 2025, worldwide sales increased 6.0% to $94.2 billion as compared to an increase of 4.3% in 2024.
New accounting pronouncements Refer to Note 1 to the Consolidated Financial Statements for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of December 29, 2024. 40 Economic and market factors The Company is aware that its products are used in an environment where, for more than a decade, policymakers, consumers and businesses have expressed concerns about the rising cost of healthcare.
Economic and market factors The Company is aware that its products are used in an environment where, for more than a decade, policymakers, consumers and businesses have expressed concerns about the rising cost of healthcare. In response to these concerns, the Company has a long-standing policy of pricing products responsibly.
This represents a decrease of 0.5% in 2024 and an increase of 1.9% in 2023. In fiscal 2024, acquisitions and divestitures had a net positive impact of 0.2% on the international operational sales growth. In fiscal 2024, the impact of the Covid-19 Vaccine sales decline on the international operational sales was a negative 2.6%.
Sales by international companies were $40.4 billion in 2025 and $38.5 billion in 2024. This represents an increase of 5.0% in 2025, and a decrease of 0.5% in 2024. In fiscal 2025, acquisitions and divestitures had a net positive impact of 0.1% on the international operational* sales growth, primarily related to Shockwave.
(3) The fiscal year 2024 includes the loss of $0.4 billion on the completion of the debt for equity exchange of the retained stake in Kenvue.
The fiscal year 2024 includes charges of approximately $5.1 billion for talc matters (See Note 19 to the Consolidated Financial Statements for additional details). (2) The fiscal year 2024 includes the loss of $0.4 billion on the completion of the debt for equity exchange of the retained stake in Kenvue.
Future changes in tax laws and rates may affect recorded deferred tax assets and liabilities. The Company has unrecognized tax benefits for uncertain tax positions. The Company follows U.S. GAAP, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
Future changes in tax laws and rates may affect recorded deferred tax assets and liabilities in the future. The Company records unrecognized tax benefits for uncertain tax positions. The Company follows U.S.
The Company has accounted for operations in Argentina, Venezuela, Turkey and Egypt (beginning in the fiscal fourth quarter of 2024) as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%. This did not have a material impact to the Company's results in the period.
The Company continues to monitor these situations and take appropriate actions. Inflation rates continue to have an effect on worldwide economies and, consequently, on the way companies operate. The Company has accounted for operations in Argentina, Venezuela, Turkey and Egypt (beginning in the fiscal fourth quarter of 2024) as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%.
Reasonably likely changes to assumptions used to calculate the accruals for rebates, returns and promotions are not anticipated to have a material effect on the financial statements.
Upfront fees received as part of these arrangements are generally deferred and recognized over the performance period. See Note 1 to the Consolidated Financial Statements for additional disclosures on collaborations. Reasonably likely changes to assumptions used to calculate the accruals for rebates, returns and promotions are not anticipated to have a material effect on the financial statements.
The Company faces various worldwide healthcare changes that may continue to result in pricing pressures that include healthcare cost containment and government legislation relating to sales, promotions, pricing and reimbursement of healthcare products. 2024 Annual Report 41 Changes in the behavior and spending patterns of purchasers of healthcare products and services, including delaying medical procedures, rationing prescription medications, reducing the frequency of physician visits and foregoing healthcare insurance coverage may continue to impact the Company’s businesses.
Changes in the behavior and spending patterns of purchasers of healthcare products and services, including delaying medical procedures, rationing prescription medications, reducing the frequency of physician visits and foregoing healthcare insurance coverage may continue to impact the Company’s businesses. The Company also operates in an environment increasingly hostile to intellectual property rights.
The Company currently discloses the impact of changes to assumptions in the quarterly or annual filing in which there is a material financial statement impact. 2024 Annual Report 37 Below are tables that show the progression of accrued rebates, returns, promotions, reserve for doubtful accounts and reserve for cash discounts by segment of business for the fiscal years ended December 29, 2024 and December 31, 2023.
Below are tables that show the progression of accrued rebates, returns, promotions, reserve for doubtful accounts and reserve for cash discounts by segment of business for the fiscal years ended December 28, 2025 and December 29, 2024.
The 340B Drug Pricing Program is a U.S. federal government program requiring drug manufacturers to provide significant discounts on covered outpatient drugs to covered entities. 26 During 2024, the Company advanced its pipeline with several regulatory submissions and approvals for new drugs and additional indications for existing drugs as follows: Product Name (Chemical Name) Indication US Approval EU Approval US Filing EU Filing BALVERSA (erdafitinib) Treatment of Patients with Locally Advanced or Metastatic Urothelial Carcinoma and Selected Fibroblast Growth Factor Receptor Gene Alterations (THOR) • • CARVYKTI (ciltacabtagene autoleucel) Treatment for Relapsed and Refactor multiple myeloma with 1-3 PL (CARTITUDE-4) • • DARZALEX (daratumumab) Treatment for frontline multiple myeloma transplant eligible (PERSEUS) • • DARZALEX (daratumumab) Treatment for frontline multiple myeloma transplant ineligible (CEPHEUS) • • DARZALEX (daratumumab) Treatment as subcutaneous monotherapy for high-risk smoldering multiple myeloma (AQUILA) • • EDURANT (rilpivirine) Treatment for pediatric patients (2-12 years old) with HIV • • IMBRUVICA (ibrutinib) Treatment for frontline MCL (Triangle) • nipocalimab Treatment for Generalized Myasthenia Gravis • • OPSUMIT (macitentan) Treatment for pediatric pulmonary arterial hypertension (TOMORROW) • • OPSYNVI (macitentan/tadalafil STCT) Treatment for pulmonary arterial hypertension • • REKAMBYS Treatment for Adolescents HIV • RYBREVANT (amivantamab) In Combination with Chemotherapy for the First-Line Treatment of Adult Patients with Advanced Non-Small Cell Lung Cancer with Activating EGFR Exon 20 Insertion Mutations (PAPILLON) • • RYBREVANT (amivantamab) Treatment for subcutaneous (PALOMA-3) • • RYBREVANT / LAZCLUZE Treatment for Non-Small Cell Lung Cancer (MARIPOSA) • • RYBREVANT Treatment for Non-Small Cell Lung Cancer 2L (MARIPOSA-2) • • SIMPONI (golimumab) Treatment of Patients with Pediatric Ulcerative Colitis • • SPRAVATO (esketamine) monotherapy Treatment of Patients with Treatment Resistant Depression (TRD4005) • STELARA (ustekinumab) Treatment of Patients with Pediatric Crohn's Disease • TREMFYA (guselkumab) Treatment of Patients with Ulcerative Colitis (QUASAR) • • TREMFYA (guselkumab) Subcutaneous Induction for treatment of patients with Ulcerative Colitis (ASTRO) • TREMFYA (guselkumab) Subcutaneous Induction for treatment of patients with Crohn's Disease (GRAVITI) • • TREMFYA (guselkumab) Treatment of Patients with Crohn's Disease (GALAXI) • • TREMFYA (guselkumab) Treatment of Patients with Pediatric Psoriasis • UPTRAVI (selexipag) Treatment of Patients with Pediatric Pulmonary Arterial Hypertension (SALTO) • 2024 Annual Report 27 MedTech segment The MedTech segment sales in 2024 were $31.9 billion, an increase of 4.8% from 2023, which included operational growth of 6.2% and a negative currency impact of 1.4%.
The 340B Drug Pricing Program is a U.S. federal government program requiring drug manufacturers to provide significant discounts on covered outpatient drugs to covered entities. 26 During 2025, the Company advanced its pipeline with several regulatory submissions and approvals for new drugs and additional indications for existing drugs as follows: Product Name (Chemical Name) Indication US Approval EU Approval US Filing EU Filing AKEEGA (niraparib/abiraterone) Treatment of patients with M1 Metastatic Castration-Sensitive Prostate Cancer (AMPLITUDE) • • CAPLYTA (lumateperone) Adjunctive treatment for Major Depressive Disorder • DARZALEX (daratumumab) Treatment for frontline multiple myeloma transplant ineligible (CEPHEUS) • • DARZALEX (daratumumab) Treatment as subcutaneous monotherapy for high-risk smoldering multiple myeloma (AQUILA) • • ICOTYDE (icotrokinra) Treatment for Psoriasis (ICONIC) • • INLEXZO (gemcitabine intravesical system) Treatment for non muscle invasive bladder cancer (SunRISe-1) • IMAAVY (nipocalimab) Treatment for Generalized Myasthenia Gravis (Vivacity MG3) • • IMAAVY (nipocalimab) Treatment for Generalized Myasthenia Gravis Pediatrics (VIBRANCE MG) • IMBRUVICA (ibrutinib) Treatment for frontline MCL (Triangle) • RYBREVANT (amivantamab) Treatment for subcutaneous (PALOMA-3) • • SIMPONI (golimumab) Treatment of Patients with Pediatric Ulcerative Colitis (PURSUIT 2) • • SPRAVATO (esketamine) Treatment of Patients with Treatment Resistant Depression monotherapy (TRD4005) • STELARA (ustekinumab) Treatment of Patients with Pediatric Crohn's Disease • • STELARA (ustekinumab) Treatment of Patients with Pediatric Ulcerative Colitis (UNIFI JR) • • TECVAYLI (teclistamab) Multiple Myeloma 1-3PLs (MajesTEC-3) • TREMFYA (guselkumab) Treatment of Patients with Ulcerative Colitis (QUASAR) • TREMFYA (guselkumab) Subcutaneous Induction for treatment of patients with Ulcerative Colitis (ASTRO) • • TREMFYA (guselkumab) Subcutaneous Induction for treatment of patients with Crohn's Disease (GRAVITI) • • TREMFYA (guselkumab) Treatment of Patients with Crohn's Disease (GALAXI) • • TREMFYA (guselkumab) Treatment of Patients with Pediatric Psoriasis (PROTOSTAR) • • TREMFYA (guselkumab) Treatment of patients with Psoriatic Arthritis Structural Damage (APEX) • TREMFYA (guselkumab) Treatment of Patients with Pediatric Juvenile Psoriatic Arthritis • 2025 Annual Report 27 MedTech segment The MedTech segment sales in 2025 were $33.8 billion, an increase of 6.1% from 2024, which included operational growth of 5.4% and a positive currency impact of 0.7%.
In addition, the Company monitors the global capital markets on an ongoing basis and from time to time may raise capital when market conditions are favorable.
In addition, the Company monitors the global capital markets on an ongoing basis and from time to time may raise capital when market conditions are favorable. The following table summarizes the Company’s material contractual obligations and their aggregate maturities as of December 28, 2025: To satisfy these obligations, the Company intends to use cash from operations.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Management’s discussion and analysis of results of operations and financial condition - Liquidity and capital resources - Financing and market risk of this Report; and Note 1 Summary of significant accounting policies - Financial instruments of the Notes to Consolidated Financial Statements included in Item 8 of this Report. 42
Management’s discussion and analysis of results of operations and financial condition - Liquidity and capital resources - Financing and market risk of this Report; and Note 1 Summary of significant accounting policies - Financial instruments of the Notes to Consolidated Financial Statements included in Item 8 of this Report. 2025 Annual Report 41

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