$ millions, except per share data Net sales Cost of sales APPLE INC. Comparative Income Statements Current Year Prior Year Dollar Change Percent Change $260,174 $265,595 $(5,421) (2.0)% 161,782 163,756 (1,974) (1.2)% Gross margin 98,392 101,839 (3,447) (3.4)% Research and development 16,217 14,236 1,981 13.9% Selling, general and administrative 18,245 16,705 1,540 9.2% Total operating expenses 34,462 30,941 3,521 11.4% Operating income 63,930 70,898 (6,968) (9.8)% Other income, net 1,807 2,005 (198) (9.9)% Income before provision for income taxes 65,737 72,903 (7,166) (9.8)% Provision for income taxes 10,481 13,372 (2,891) (21.6)% Net income $ 55,256 $ 59,531 (4,275) (7.2)% Basic earnings per share $ 11.97 $ 12.01 $ (0.04) (0.3)% Diluted earnings per share $ 11.89 $ 11.91 $ (0.02) (0.2)% (In millions) Balance at December 31, 2019 Cumulative effect of accounting changes Issuance of shares under employees' and directors' stock plans Stock-based compensation Purchases of company common stock Dividends declared ($0.88 per share) Net income Other comprehensive items Contributions from (distributions to) noncontrolling interests Balance at December 31, 2020 Issuance of shares under employees' and directors' stock plans Stock-based compensation Purchases of company common stock Dividends declared ($1.04 per share) Recognition upon acquisition Net income Other comprehensive items Contributions from (distributions to) noncontrolling interests Redeemable Noncontrolling Common Stock Capital in CONSOLIDATED STATEMENT OF REDEEMABLE NONCONTROLLING INTEREST AND EQUITY Total Thermo Fisher Scientific Inc. Excess of Par Retained Treasury Stock Accumulated Other Comprehensive Shareholders' Noncontrolling Interest Shares Amount Value Earnings Shares Amount Items Equity Interests 434 $ 434 15,064 $ 22,092 36 $ (5,236) $ (2,679) $ 29,675 $ 9 $ (1) (1) |||| | | | | | | 12- (1) 3 3 319 196 437 437 15,579 2 2 324 Other Balance at December 31, 2021 122 439 439 Issuance of shares under employees' and directors' stock plans 2 2 262 Stock-based compensation Purchases of company common stock Dividends declared ($1.20 per share) Net income 15 Other comprehensive items (6) |||| Contributions from (distributions to) noncontrolling interests (15) Balance at December 31, 2022 116 441 $ 441 - - 41 | | | | | |G | | | | 230 16,174 307 (82) 4 (1,500) (350) 6,375 (1,500) (1,500) (350) (350) 6,375 2 6,377 (128) (128) (128) (1) (1) 28,116 40 (6,818) (2,807) 34,507 10 34,517 1 (104) 222 230 4 (2,000) (2,000) (410) (410) 222 230 (2,000) (410) 7,725 7,725 2 7,727 478 478 478 240 196 Total Equity 29,684 (1) 240 196 50 50 50 41 41 35,431 45 (8,922) (2,329) 40,793 62 40,855 (95) 169 169 307 307 5 (3,000) (471) 6,950 (3,000) (3,000) (471) (471) 6,950 (5) 6,945 (770) (770) (1) (771) (2) (2) 16,743 $ 41,910 50 $ (12,017) $ (3,099) $ 43,978 $ 54 $ 44,032 F-9 The accompanying notes are an integral part of these consolidated financial statements. CONSOLIDATED STATEMENT OF CASH FLOWS December 31, Year Ended December 31, December 31, 2022 2021 2020 (In millions) Operating activities Net income $ 6,960 $ 7,728 $ 6,377 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation of property, plant and equipment 986 831 658 Amortization of acquisition-related intangible assets 2,395 1,761 1,667 Change in deferred income taxes (995) (647) (552) Stock-based compensation 307 230 196 Loss on early extinguishment of debt 26 767 Other non-cash expenses 524 190 338 Changes in assets and liabilities, excluding the effects of acquisitions and disposition: Accounts receivable (430) (204) Inventories (825) (1,065) (1,302) (508) Accounts payable 648 479 59 Contributions to retirement plans (41) (34) (96) Other (401) (724) 1,452 Net cash provided by operating activities 9,154 9,312 8,289 Investing activities Acquisitions, net of cash acquired (39) (19,395) (38) Purchase of property, plant and equipment (2,243) (2,523) (1,474) Proceeds from sale of property, plant and equipment 24 20 8 Other investing activities, net 99 (34) (6) Net cash used in investing activities (2,159) (21,932) (1,510) Financing activities Net proceeds from issuance of debt Repayment of debt Proceeds from issuance of commercial paper Repayments of commercial paper Purchases of company common stock Dividends paid Other financing activities, net 3,193 18,137 3,464 (375) (11,738) (710) 1,526 2,512 383 (3,690) (387) (3,000) (2,000) (1,500) (455) (395) (337) (9) 65 46 (2,810) 6,581 959 Net cash (used in) provided by financing activities Exchange rate effect on cash (139) 194 176 Increase (decrease) in cash, cash equivalents and restricted cash Cash, cash equivalents and restricted cash at beginning of year 4,046 (5,845) 7,914 4,491 10,336 2,422 Cash, cash equivalents and restricted cash at end of year $ 8,537 $ 4,491 $ 10,336 (In millions) CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Year Ended December 31, December 31, December 31, 2022 2021 2020 Comprehensive income Net income 6,960 $ 7,728 $ 6,377 Other comprehensive items: Currency translation adjustment: Currency translation adjustment (net of tax provision (benefit) of $173, $231 and S(221)) (822) 373 (118) Unrealized gains and losses on hedging instruments: Unrealized losses on hedging instruments (net of tax benefit of $0, $0 and $20) 2 56 45 5655 (65) Reclassification adjustment for losses included in net income (net of tax benefit of $1, $17 and $14) Pension and other postretirement benefit liability adjustments: Pension and other postretirement benefit liability adjustments arising during the period (net of tax provision (benefit) of $9, $11 and $(1)) Amortization of net loss and prior service benefit included in net periodic pension cost (net of tax benefit of $3, $6 and $4) Total other comprehensive items Comprehensive income 38 36 (8) 5 13 18 (777) 478 (128) 6,183 8,206 6,249 Less: comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interest 3 2 2 Comprehensive income attributable to Thermo Fisher Scientific Inc. $ 6,180 $ 8,204 $ 6,247 (In millions except per share amounts) Revenues Product revenues Service revenues Total revenues Costs and operating expenses: CONSOLIDATED STATEMENT OF INCOME December 31, Year Ended December 31, December 31, 2022 2021 2020 $ 28,548 $ 30,361 $ 25,306 16,367 8,850 6,912 44,915 39,211 32,218 Cost of product revenues 14,247 13,594 11,407 Cost of service revenues 11,697 5,979 4,807 Selling, general and administrative expenses 8,993 8,007 6,930 Research and development expenses 1,471 1,406 1,181 Restructuring and other costs 114 197 99 Total costs and operating expenses 36,522 29,183 Operating income Interest income Interest expense Other income/(expense) Income before income taxes Provision for income taxes 8,393 10,028 24,424 7,794 272 43 65 (726) (536) (553) (104) (694) (76) 7,835 8,841 7,230 (703) (1,109) (850) Equity in earnings/(losses) of unconsolidated entities Net income (172) (4) (3) 6,960 7,728 6,377 Less: net income attributable to noncontrolling interests and redeemable noncontrolling interest Net income attributable to Thermo Fisher Scientific Inc. 10 3 2 $ 6,950 $ 7,725 $ 6,375 Earnings per share attributable to Thermo Fisher Scientific Inc. Basic $ 17.75 $ 19.62 $ 16.09 Diluted $ 17.63 $ 19.46 $ 15.96 Weighted average shares Basic Diluted 392 394 396 394 397 399 The accompanying notes are an integral part of these consolidated financial statements. CONSOLIDATED BALANCE SHEET December 31, December 31, 2022 2021 (In millions except share and per share amounts) Assets Current assets: Cash and cash equivalents Accounts receivable, less allowances of $189 and $150 Inventories Contract assets, net Other current assets Total current assets Property, plant and equipment, net Acquisition-related intangible assets, net Other assets Goodwill Total assets $ 8,524 $ 4,477 8,115 7,977 5,634 5,051 1,312 968 1,644 1,640 25,229 20,113 9,280 8,333 17,442 20,113 4,007 4,640 41,196 41,924 $ 97,154 $ 95,123 Liabilities, redeemable noncontrolling interest and equity Current liabilities: Short-term obligations and current maturities of long-term obligations $ 5,579 $ 2,537 Accounts payable 3,381 2,867 Accrued payroll and employee benefits 2,095 2,427 Contract liabilities 2,601 2,655 Other accrued expenses Total current liabilities Deferred income taxes Other long-term liabilities Long-term obligations Commitments and contingencies (Note 12) Redeemable noncontrolling interest 3,354 2,950 17,010 13,436 2,849 3,837 4,238 4,540 28,909 32,333 116 122 Equity: Thermo Fisher Scientific Inc. shareholders' equity: Preferred stock, $100 par value, 50,000 shares authorized; none issued Common stock, $1 par value, 1,200,000,000 shares authorized; 440,668,112 and 439,154,741 shares issued Capital in excess of par value Retained earnings Treasury stock at cost, 50,157,275 and 44,720,112 shares Accumulated other comprehensive items Total Thermo Fisher Scientific Inc. shareholders' equity Noncontrolling interests Total equity Total liabilities, redeemable noncontrolling interest and equity 441 439 16,743 16,174 41,910 35,431 (12,017) (8,922) (3,099) (2,329) 43,978 40,793 54 62 44,032 40,855 $ 97,154 $ 95,123