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1月前
Solventum Reports First Quarter 2026 Financial ResultsMay 5, 2026 4:05 PM
PR Newswire (US) Reported sales decreased (3.0)%; organic sales increased 2.1%Affirms full-year 2026 organic sales growth and free cash flow guidance; estimates adjusted EPS will be toward the high end of existing rangeEAGAN, Minn., May 5, 2026 /PRNewswire/ -- Solventum (NYSE: SOLV) today reported financial results for the first quarter ended March 31, 2026. First Quarter 2026 HighlightsSales of $2.0 billion decreased (3.0)% on a reported basis; an increase of 2.1% on an organic basisGAAP diluted earnings per share of $0.07; adjusted diluted earnings per share of $1.48, a 10.6% increaseOperating cash flow of $(189) million; free cash flow of $(273) millionDelivered first quarter results ahead of expectations, reflecting strong execution and underlying commercial momentum."Solventum delivered first quarter results ahead of expectations, reflecting strong execution and underlying commercial momentum," said Bryan Hanson, chief executive officer of Solventum. "The work we're doing to transform the company is reinforcing our confidence in the full year and accelerating progress toward our long-range plan."First Quarter 2026 Financial Results
Three months ended March 31,(Dollars in millions, except per share amounts)2026
2025
Year-over-year
changeNet sales$ 2,007
$ 2,070
(3.0) %Selling, general and administrative expenses$ 827
$ 769
7.5 %Research and development expenses$ 189
$ 193
(2.1) %Operating income margin4.0 %
7.3 %
(330) bpsAdjusted operating income margin119.5 %
19.7 %
(20) bpsNet income$ 13
$ 137
(90.5) %Diluted earnings per share$ 0.07
$ 0.78
(91.0) %Adjusted diluted earnings per share1$ 1.48
$ 1.34
10.6 %Net cash provided by (used in) operating activities$ (189)
$ 29
(751.7) %Free cash flow1$ (273)
$ (80)
(241.3) %
1 Represents non-GAAP financial measure; see the "Non-GAAP Financial Measures" section for applicable information.Discussion of First Quarter Results
All comparisons are to the prior year period unless otherwise notedOrganic sales growth of +2.1% in the quarter reflects strong performance across all reportable segments, primarily driven by volume and product mix.GAAP and adjusted gross margin both increased by 80 bps due to programmatic savings, portfolio moves, sales leverage and mix, partially offset by tariffs and inflation headwinds.Selling, general and administrative expenses increased primarily due to higher costs associated with separation activities and Transform for the Future, partially offset by restructuring benefits.GAAP operating income margin decreased driven by separation and restructuring costs while adjusted operating income margin decreased primarily due to tariffs and inflation, partially offset by operational improvements.Operating cash flow for the quarter was $(189) million and free cash flow was $(273) million, driven by separation activities, transition agreement exit payments and normal seasonality.Other Business and Operational HighlightsCelebrated the grand opening of a new 250,000 square foot flagship R&D center of excellence in Eagan, Minnesota, featuring modern workspaces, a pilot factory and a dedicated quality lab to fuel a steady pipeline of healthcare innovation.Completed a manufacturing expansion in Brookings, South Dakota, adding 200,000 square feet, 16 shipping docks and an 8,000-pallet warehouse to strengthen production capacity and speed innovations from lab to clinicians.Segment and Total Company Net Sales for First Quarter*
Three months ended March 31,
Increase/(Decrease)(Dollars in millions)
2026
2025
Reported
growth
Currency
impact
Constant
currency2
Other3
Organic
growthAdvanced Wound Care
$ 497
$ 448
10.9 %
2.6 %
8.3 %
6.2 %
2.1 %Infection Prevention and Surgical Solutions
737
710
3.9
3.3
0.6
—
0.6MedSurg
1,234
1,157
6.6
3.0
3.6
2.4
1.2Dental Solutions
354
328
7.9
4.5
3.4
—
3.4Health Information Systems
342
329
4.1
0.7
3.4
(1.3)
4.7Total reportable segment net sales
1,931
1,814
Purification and Filtration
—
180
NM
NM
NM
NM
NMAll Other4
76
76
0.9
2.3
(1.4)
—
(1.4)Total Company
$ 2,007
$ 2,070
(3.0) %
2.7 %
(5.7) %
(7.8) %
2.1 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. "NM" reflects results considered not meaningful due to sale of the Purification and Filtration business in September 2025.
2 Constant currency represents the change in net sales absent the impact on sales from foreign currency translation.
3 Other represents sales impact from acquisitions and divestitures measured separately for the first 12 months post-transaction. Acquisitions include sales from the December 2025 acquisition of Acera. Divestitures primarily represents lost sales from the Company's Purification and Filtration business that was sold in September 2025.
4 All Other includes the drinking water business, which was previously reported within Purification and Filtration, and sales related to product supplied to 3M and other supply agreements related to legacy 3M business and assumed by the Company at Spin-Off.Full-Year 2026 Guidance
Solventum is affirming its full year 2026 guidance:Organic sales growth of +2.0% to +3.0%; +3.0% to +4.0% excluding ~100 bps of SKU exit impactAdjusted EPS estimated to be toward the high end of existing $6.40 to $6.60 guidance rangeFree cash flow of ~$200MOrganic sales, adjusted diluted EPS and free cash flow amounts included in Solventum's full-year guidance are non-GAAP financial measures. Solventum does not provide reconciliations of the forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items, such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items.See the "Non-GAAP Financial Measures" section for explanations of our non-GAAP financial measures.Earnings Conference Call
Solventum will host a conference call today, May 5, at 4:30 p.m. Eastern Time to discuss its first quarter financial results and fiscal year 2026 outlook. The conference call can be accessed via audio webcast at investors.solventum.com or by dialing (800) 715-9871 within the U.S. or +1 (646) 307-1963 for international callers, using the conference ID 6342275.A replay of the webcast, along with the earnings press release, slides highlighting the results and supplemental financial disclosures, will also be available at the same link on the Investor Relations section of the Company's website.Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934 that are subject to risks and uncertainties. Solventum intends the forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in those sections. Forward-looking statements include all statements that are not historical facts, but instead represent only Solventum's beliefs regarding future goals, plans and expectations about its prospects for the future and other events, many of which, by their nature, are inherently uncertain and outside of Solventum's control. Forward-looking statements include those containing such words as "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "forecasts," "goal," "guidance," "intends," "may," "outlook," "plans," "potential," "predicts," "projects," "seeks," "sees," "should," "targets," "will," "would" or other words of similar meaning or by using future dates in connection with the discussion of, among other things, statements expressing general views about future operating or financial results, operating or financial performance, trends, events or developments that we expect or anticipate will occur in the future, anticipated cost savings, the launch and acceptance of new products and changes in the global economic environment. It is possible that Solventum's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements, including from risks and uncertainties related to, among others: competition and disruption in the healthcare industry; global economic, political and geopolitical conditions; changes in trade and tariff policies; changes in legislation or practices related to reimbursement, regulatory requirements and approvals; the development, manufacturing, marketing and sale of healthcare products; supply chain and operational execution; acquisitions, divestitures and other strategic transactions; Solventum's separation from 3M and performance as a standalone company, including the tax-free nature of the spin and its ability to execute on its short- and long-range plans and capital allocation strategies; artificial intelligence, information technology and cybersecurity risks; restructuring programs, and other risks and uncertainties described in Solventum's filings with the U.S. Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Solventum's management believes that these forward-looking statements are reasonable as of the time made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. Solventum undertakes no obligation to update any forward-looking statements or other information in this press release as a result of new information, future events or otherwise, except as required by applicable law.Non-GAAP Financial Measures
In addition to reporting financial results in accordance with U.S. GAAP, Solventum also provides non-GAAP measures that we use, and plan to continue using, when monitoring and evaluating operating performance and measuring cash available to invest in our business. The adjusted measures are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP financial measures are supplemental measures of our performance and our liquidity that we believe help investors understand our underlying business performance and Solventum uses these measures as an indication of the strength of Solventum and its ability to generate cash.Solventum calculates forward-looking non-GAAP financial measures, including organic sales growth, adjusted gross margin, adjusted operating income, adjusted operating income margin, adjusted effective tax rate, adjusted diluted earnings per share and free cash flow based on internal forecasts that omit certain amounts that would be included in GAAP financial measures. Solventum does not provide reconciliations of these forward-looking non-GAAP financial measures to the most directly comparable GAAP measures as it is unable to predict with reasonable certainty and without unreasonable effort certain items such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items. The timing and amounts of these items are uncertain and could have a material impact on Solventum's results in accordance with GAAP.The Q1 2026 financial statements and financial information, including reconciliations of non-GAAP financial measures, are available on Solventum's website: investors.solventum.com.About Solventum
At Solventum, we enable better, smarter, safer healthcare to improve lives. As a new company with a long legacy of creating breakthrough solutions for our customers' toughest challenges, we pioneer game-changing innovations at the intersection of health, material and data science that change patients' lives for the better — while empowering healthcare professionals to perform at their best. See how at Solventum.com. Solventum CorporationCONDENSED CONSOLIDATED STATEMENTS OF INCOME*(Dollars in millions, except per-share data)(Unaudited)
Three months ended March 31,
2026
2025Net sales of product
$ 1,513
$ 1,597Net sales of software and rentals
493
473Total net sales
2,007
2,070Cost of product
796
835Cost of software and rentals
115
121Gross profit
1,097
1,114Selling, general and administrative expenses
827
769Research and development expenses
189
193Operating income
81
152Interest expense, net
62
104Other expense (income), net
4
11Income before income taxes
16
38Provision for (benefit from) income taxes
3
(99)Net income
$ 13
$ 137
Earnings per share:
Basic earnings per share
$ 0.07
$ 0.79Diluted earnings per share
0.07
0.78Weighted-average number of shares outstanding:
Basic
174.2
173.7Diluted
175.5
174.8
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum CorporationCONDENSED CONSOLIDATED BALANCE SHEETS*(Dollars in millions, except per-share data)(Unaudited)
March 31,
December 31,
2026
2025Assets
Current assets
Cash and cash equivalents
$ 561
$ 878Accounts receivable — net of allowances of $87 and $87
1,059
1,034Due from related parties
121
150Inventories
Finished goods
643
636Work in process
222
201Raw materials and supplies
224
229Total inventories
1,089
1,066Other current assets
754
731Total current assets
3,583
3,859Property, plant and equipment — net
1,543
1,326Goodwill
5,626
5,704Intangible assets — net
2,497
2,592Other assets
848
814Total assets
$ 14,097
$ 14,294Liabilities
Current liabilities
Short-term borrowings and current portion of long-term debt
$ 505
$ —Accounts payable
699
687Due to related parties
337
435Unearned revenue
613
621Other current liabilities
1,192
1,393Total current liabilities
3,346
3,136Long-term debt
4,575
5,035Pension and postretirement benefits
360
363Deferred income taxes
161
164Finance leases
207
—Other liabilities
478
547Total liabilities
$ 9,128
$ 9,245
Equity
Common stock, par value $0.01 per share, 750,000,000 shares authorized
$ 2
$ 2Shares - March 31, 2026: issued: 174,454,292; outstanding: 173,531,656
Shares - December 31, 2025: issued and outstanding: 173,490,864
Additional paid-in capital
3,895
3,876Retained earnings
1,810
1,797Treasury stock, at cost
(67)
—Shares - March 31, 2026: 922,636
Shares - December 31, 2025: 0
Accumulated other comprehensive income (loss)
(670)
(625)Total equity
4,969
5,049Total liabilities and equity
$ 14,097
$ 14,294
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum CorporationCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS*(Dollars in millions)(Unaudited)
Three months ended March 31,
2026
2025Cash flows from operating activities
Net income
$ 13
$ 137Adjustments to reconcile net income to net cash provided by (used in) operating activities
Depreciation and amortization
135
129Pension and postretirement benefit expense
14
15Stock-based compensation expense
51
49Deferred income taxes
(41)
(144)Changes in assets and liabilities
Accounts receivable
(34)
6Due from related parties
28
5Inventories
(32)
(32)Accounts payable
23
9Due to related parties
(100)
(6)Accrued compensation
(151)
(107)All other operating activities — net
(94)
(32)Net cash provided by (used in) operating activities
(189)
29
Cash flows from investing activities
Purchases of property, plant and equipment
(84)
(109)Other — net
7
(5)Net cash used in investing activities
(77)
(114)
Cash flows from financing activities
Repayment of debt
—
(100)Proceeds from long-term debt, net of issuance costs
46
—Net transfers from (to) 3M
2
(31)Purchases of treasury stock
(67)
—Other — net
(31)
(8)Net cash used in financing activities
(50)
(139)
Effect of exchange rate changes on cash and cash equivalents
(2)
1
Net increase (decrease) in cash and cash equivalents
(318)
(223)Cash and cash equivalents at beginning of period
878
762Less: Cash and cash equivalents within held for sale
—
(5)Cash and cash equivalents at end of period
$ 561
$ 534
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.Solventum Corporation and Subsidiaries
BUSINESS SEGMENTS – (CONTINUED)*
(Unaudited)The Company's operating activities are primarily managed through three segments: MedSurg, Dental Solutions, and Health Information Systems.MedSurg provides:Advanced wound care products such as negative pressure wound therapy, advanced wound dressings, advanced skin care, and synthetic tissue matrices; andInfection prevention and surgical solutions products, such as I.V. site management, sterilization assurance, temperature management, surgical supplies, medical tapes and wraps, stethoscopes, medical electrodes, and medical technologies Original Equipment Manufacturer ("OEM").Dental Solutions provides dental and orthodontic products, including brackets, aligners, restorative cements, and bonding agents that span the "life of the tooth," including products designed for preventative dental care, direct and indirect restoration, and broad orthodontic needs.Health Information Systems provides healthcare systems with software solutions — including computer-assisted physician documentation, direct-to-bill and coding automation, classification methodologies, speech recognition, and data visualization platforms — that are designed to eliminate revenue cycle waste, create more time for patient care, and support value-based care.Purification and Filtration consists of filters and membranes for biopharmaceutical and medical technologies, as well as microelectronics and food and beverage that were reported prior to the sale of the business in September 2025.All other primarily consists of the Water Business that was retained after the sale of the Purification and Filtration Business. All other also includes sales and cost of sales related to our agreements to supply 3M and other supply agreements assumed by the Company at Spin-Off related to legacy 3M businesses, which were historically included within Corporate and Unallocated.BUSINESS SEGMENT INFORMATION AND DISAGGREGATED NET SALES*
Three months ended March 31, 2026
Three months ended March 31, 2025
(Dollars in millions)
Net sales
Operating
income
Operating
margin %
Net sales
Operating
income
Operating
margin %Advanced Wound Care
$ 497
$ 448
Infection Prevention and Surgical Solutions
737
710
MedSurg
1,234
$ 161
13.1 %
1,157
$ 206
17.8 %Dental Solutions
354
87
24.5
328
78
23.9Health Information Systems
342
130
38.1
329
109
33.1Total reportable segment net sales and operating income
1,931
379
1,814
393
Purification and Filtration
—
—
NM
180
27
15.1All other
76
12
15.4
76
11
15.2Amortization expense
(90)
(81)
Corporate and unallocated
(219)
(198)
Total Company
$ 2,007
$ 81
4.0 %
$ 2,070
$ 152
7.3 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.Solventum Corporation
SUPPLEMENTAL FINANCIAL INFORMATION
NON-GAAP MEASURES
(Unaudited)In addition to reporting financial results in accordance with U.S. GAAP, the Company uses non-GAAP financial measures to supplement the financial measures prepared in accordance with U.S. GAAP. These include (1) adjusted gross margin, adjusted operating income and adjusted operating income margin, (2) adjusted diluted earnings per share, and (3) free cash flow. Management believes that these non-GAAP financial measures are useful in evaluating current performance and focusing management on our underlying operational results.There are limitations to the use of the non-GAAP financial measures presented in this information statement. These non-GAAP financial measures are not prepared in accordance with U.S. GAAP nor do they have any standardized meaning under U.S. GAAP. In addition, other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non-GAAP financial measures may not be comparable to such similarly titled non-GAAP financial measures used by other companies. Management cautions you not to place undue reliance on these non-GAAP financial measures, but instead to consider them with the most directly comparable U.S. GAAP measure. These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation. These non-GAAP financial measures should be considered supplements to, not substitutes for, or superior to, the corresponding financial measures calculated in accordance with U.S. GAAP.The tables below reconcile our non-GAAP financial measures to the nearest financial measure that is in accordance with U.S. GAAP for the periods presented.Adjusted Gross Margin, Adjusted Operating Income, Adjusted Operating Income Margin and Adjusted Earnings Per Share (Non-GAAP measures)Adjusted gross margin, adjusted operating income and adjusted operating income margin are not defined under U.S. GAAP. Therefore, they should not be considered a substitute for earnings data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Solventum defines adjusted gross margin as gross margin excluding the effects of restructuring costs, Spin-Off and separation-related costs, separation-related impacts due to the sale of the Purification and Filtration business, and acquisition-related costs. Solventum defines adjusted operating income as operating income excluding the effects of amortization, restructuring costs, Spin-Off and separation-related costs, certain litigation-related costs, separation-related impacts due to the sale of the Purification and Filtration business, and acquisition-related costs. Adjusted operating income margin is adjusted operating income divided by the U.S GAAP measure total net sales for the same period. The Company believes adjusted gross margin, adjusted operating income and adjusted operating income margin provide investors with visibility into the Company's unleveraged, pre-tax operating results and reflects underlying financial performance. However, adjusted gross margin and adjusted operating income should not be construed as inferring that the Company's future results will be unaffected by the items for which the measure adjusts.Adjusted diluted earnings per share is not defined under U.S. GAAP. Therefore, it should not be considered a substitute for earnings data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Solventum defines adjusted diluted earnings per share as net income excluding the after-tax effects of amortization, restructuring costs, Spin-Off and separation-related costs, certain litigation-related costs, separation-related impacts due to the sale of the Purification and Filtration business, and acquisition-related costs. The Company believes adjusted earnings per share provides investors with improved comparability of underlying operating results and a further understanding and additional transparency regarding how the Company evaluates the business. However, adjusted earnings per share should not be construed as inferring that the Company's future results will be unaffected by the items for which the measure adjusts.Solventum CorporationSUPPLEMENTAL FINANCIAL INFORMATIONNON-GAAP MEASURES – (CONTINUED)*(Unaudited)
Three months ended March 31, 2026(Dollars in millions, except per
share amounts)
Net sales
Cost of
sales5
Gross
margin %
Operating
expenses6
Operating
income
Operating
income
margin %
Non-
operating
expense
(income),
net7
Income
before
income
taxes
Net income
attributable
to
Solventum
Diluted
EPS
Effective
tax rateGAAP
$ 2,007
$ 910
54.6 %
$ 1,015
$ 81
4.0 %
$ 65
$ 16
$ 13
$ 0.07
19.3 %Non-GAAP adjustments:
Amortization of acquisition-related intangible assets
—
—
—
(90)
90
4.5
—
90
76
0.43
Restructuring costs (a)
—
(1)
—
(40)
41
2.0
—
41
31
0.18
3M spin-off and separation-related costs (b)
—
(31)
1.5
(132)
163
8.1
—
163
128
0.73
Certain litigation-related costs (c)
—
—
—
(14)
14
0.7
—
14
10
0.06
Purification and Filtration separation-related (d)
—
1
—
3
(4)
(0.2)
—
(4)
(3)
(0.02)
Acquisition-related costs(e)
—
(4)
0.2
(3)
7
0.3
—
7
5
0.03
Non-GAAP
$ 2,007
$ 874
56.4 %
$ 740
$ 392
19.5 %
$ 65
$ 327
$ 260
$ 1.48
20.4 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.
Three months ended March 31, 2025(Dollars in millions, except per
share amounts)
Net sales
Cost of
sales5
Gross
margin %
Operating
expenses6
Operating
income
Operating
income
margin %
Non-
operating
expense
(income),
net7
Income
before
income
taxes
Net income
attributable
to
Solventum
Diluted
EPS
Effective
tax rateGAAP
$ 2,070
$ 956
53.8 %
$ 962
$ 152
7.3 %
$ 115
$ 38
$ 137
$ 0.78
(262.1) %Non-GAAP adjustments:
Amortization of acquisition-related intangible assets
—
—
—
(81)
81
3.9
—
81
68
0.39
Restructuring costs (a)
—
(10)
0.5
(8)
18
0.9
—
18
14
0.08
3M spin-off and separation-related costs (b)
—
(27)
1.3
(94)
121
5.8
—
121
93
0.53
Certain litigation-related costs (c)
—
—
—
(19)
19
0.9
—
19
14
0.08
Purification and Filtration separation-related (d)
—
—
—
(16)
16
0.8
—
16
(92)
(0.53)
Non-GAAP
$ 2,070
$ 919
55.6 %
$ 744
$ 407
19.7 %
$ 115
$ 293
$ 234
$ 1.34
19.9 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.(a)2026 restructuring costs primarily related to the Company's Transform for the Future program. Includes employee termination costs of $6 million and other costs of $35 million, which includes third-party consulting and compensation for employees dedicated to the program. 2025 restructuring costs primarily relate to the Company's Solventum Way program. Includes employee termination costs of $14 million and other costs of $4 million, which includes asset write-offs and other contractual third party termination costs.(b)Consists of costs specifically incurred in connection with the Company's separation from 3M.(c)Consists of charges and recoveries related to certain litigation matters.(d)2026 activity consists of the profit mark-up from transition support services. 2025 activity consists of costs related to and tax impacts from the separation of the Company's Purification and Filtration business, including legal, finance and tax advisory.(e)Integration costs related to the acquisition of Acera Surgical, including amortization of inventory step-up.
5 Cost of sales is the combination of cost of product and cost of software and rentals line items from the Condensed Consolidated Statements of Income and represents the total Company's cost of sales.6 Operating expenses is the combination of selling, general and administrative expenses and research and development expenses from the Condensed Consolidated Statements of Income and represents the total Company's other operating expenses.7 Non-operating expense (income), net is the combination of interest expense, net, and other expense (income), net line items from the Condensed Consolidated Statements of Income and represents the total Company's non-operating expense.Solventum Corporation
SUPPLEMENTAL FINANCIAL INFORMATION
NON-GAAP MEASURES – (CONTINUED)*
(Unaudited)Free Cash Flow (non-GAAP measure):Free cash flow is not defined under U.S. GAAP. Therefore, it should not be considered a substitute for income or cash flow data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. The Company defines free cash flow as net cash provided by (used in) operating activities less purchases of property, plant and equipment. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. The Company believes free cash flow is meaningful to investors as it is a useful measure of liquidity and the Company uses these measures as an indication of the strength of the Company and its ability to generate cash. Free cash flow varies across quarters throughout the year. Below find a recap of free cash flow.(Dollars in millions)
Three months ended March 31,Major GAAP cash flow categories
2026
2025Net cash provided by (used in) operating activities
$ (189)
$ 29Net cash used in investing activities
(77)
(114)Net cash used in financing activities
(50)
(139)
Free cash flow (non-GAAP measure)
Net cash provided by (used in) operating activities
$ (189)
$ 29Purchases of property, plant and equipment
(84)
(109)Free cash flow
$ (273)
$ (80)
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. View original content to download multimedia:https://www.prnewswire.com/news-releases/solventum-reports-first-quarter-2026-financial-results-302762862.htmlSOURCE Solventum Original: Solventum Reports First Quarter 2026 Financial Results
US Market News
4月前
Solventum Reports Fourth Quarter 2025 Financial Results and Introduces 2026 Full-Year GuidanceFebruary 26, 2026 4:05 PM
PR Newswire (US)
Reported sales decreased 3.7%; organic sales increased 3.5%Introduces full-year 2026 organic sales growth, adjusted EPS and free cash flow guidanceST. PAUL, Minn., Feb. 26, 2026 /PRNewswire/ -- Solventum (NYSE: SOLV) today reported financial results for the fourth quarter and year ended December 31, 2025.
Fourth Quarter 2025 HighlightsSales of $2 billion decreased 3.7% on a reported basis; an increase of 3.5% on an organic basisGAAP diluted earnings per share of $0.36; adjusted diluted earnings per share of $1.57Operating cash flow of $96 million; free cash flow of $33 million"Solventum's fourth quarter results reflect another quarter of solid performance resulting in full year 2025 results ahead of our expectations for sales and EPS," said Bryan Hanson, chief executive officer of Solventum. "We continue to deliver on our commitments; our underlying momentum and the intentional steps we've taken in our transformation journey demonstrate clear progress towards achieving our long-range plan."Fourth Quarter and Year Ended 2025 Financial Results
Three months ended December 31,
Year ended December 31,(Dollars in millions, except per share amounts)2025
2024
Year over
year change
2025
2024
Year over
year changeNet sales$ 1,998
$ 2,074
(3.7) %
$ 8,325
$ 8,254
0.9 %Selling, general and administrative expenses$ 759
$ 784
(3.2) %
$ 3,080
$ 2,782
10.7 %Research and development expenses$ 175
$ 199
(12.1) %
$ 739
$ 775
(4.6) %Operating income margin6.2 %
6.6 %
(40) bps
26.2 %
12.6 %
1,360 bpsAdjusted operating income margin119.9 %
20.4 %
(50) bps
20.5 %
22.0 %
(150) bpsNet income$ 63
$ 30
110.0 %
$ 1,556
$ 479
224.8 %Diluted earnings per share$ 0.36
$ 0.17
111.8 %
$ 8.88
$ 2.76
221.7 %Adjusted diluted earnings per share1$ 1.57
$ 1.41
11.3 %
$ 6.11
$ 6.70
(8.8) %Net cash provided by operating activities$ 96
$ 219
(56.2) %
$ 369
$ 1,185
(68.9) %Free cash flow1$ 33
$ 92
(64.1) %
$ (10)
$ 805
(101.2) %Organic sales growth in the quarter reflects positive performance from all segments, primarily driven by results of the Infection Prevention and Surgical Solutions business within MedSurg as well as Dental Solutions.GAAP and adjusted operating income margin remained largely consistent with prior year. On an adjusted basis, operating expense savings and the accretive benefit of the Purification and Filtration divestiture more than offset incremental tariff headwinds. Debt paydown following the sale of Purification and Filtration was the primary driver of the increase to adjusted earnings per share.1 Represents non-GAAP financial measure; see the "Non-GAAP Financial Measures" section for applicable information.Segment and Total Company Net Sales for Fourth Quarter*
Three months ended
December 31,
Increase/(Decrease)(Dollars in millions)
2025
2024
Reported
Growth
Currency
Impact
Constant
Currency2
Other3
Organic
GrowthAdvanced Wound Care
$ 483
$ 466
3.8 %
1.5 %
2.2 %
0.5 %
1.7 %Infection Prevention and Surgical Solutions
752
708
6.2
2.0
4.2
—
4.2MedSurg
1,235
1,174
5.2
1.8
3.4
0.2
3.2Dental Solutions
343
315
8.6
2.8
5.9
—
5.9Health Information Systems
348
336
3.7
0.5
3.2
—
3.2Total business segment net sales
1,926
1,825
Purification and Filtration
—
177
NM
NM
NM
NM
NMAll Other4
72
72
0.2
0.8
(0.6)
—
(0.6)Total Company
$ 1,998
$ 2,074
(3.7) %
1.7 %
(5.4) %
(8.9) %
3.5 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. "NM" reflects results considered not meaningful due to sale of the Purification and Filtration business in September 2025.
2 Constant currency represents the change in net sales absent the impact on sales from foreign currency translation.
3 Other represents sales impact from acquisitions and divestitures measured separately for the first 12 months post-transaction. Acquisitions include sales from the December 2025 acquisition of Acera. Divestitures primarily represents lost sales from the Company's Purification and Filtration business that was sold in September 2025.
4 All Other includes the drinking water business, which was previously reported within Purification and Filtration, and sales related to product supplied to 3M and other supply agreements related to legacy 3M business and assumed by the company at Spin-Off.Full-Year 2026 Guidance
Solventum is providing its full year 2026 guidance as follows:Organic sales growth of +2.0% to +3.0%; +3.0% to +4.0% excluding ~100bps of SKU exit impactAdjusted EPS of $6.40 to $6.60Free cash flow of ~$200MOrganic sales, adjusted diluted EPS and free cash flow amounts included in Solventum's full-year guidance are non-GAAP financial measures. Solventum does not provide reconciliations of the forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items, such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items.Please note Solventum's Q1 2024 results were reported on a carve-out basis.See the "Non-GAAP Financial Measures" section for explanations of our non-GAAP financial measures.Earnings Conference Call
Solventum will host a conference call today, Feb. 26, at 4:30 p.m. Eastern Time to discuss its fourth quarter financial results and provide a fiscal year 2026 outlook. The conference call can be accessed via audio webcast at investors.solventum.com or by dialing (800) 715-9871 within the U.S. or +1 (646) 307-1963 for international callers, using the conference ID 6342275.A replay of the webcast, along with the earnings press release, slides highlighting the results, and supplemental financial disclosures, will also be available at the same link on the Investor Relations section of the company's website.Forward-Looking Statements
This news release contains forward-looking information about Solventum that contains or incorporates by reference statements that relate to future events and expectations, including financial results, estimates and business prospects, including guidance for 2026, that constitute forward-looking statements that involve risk and uncertainties. Forward-looking statements include those containing such words as "anticipates," "believes," "could," "estimates," "expects," "forecasts," "goal," "guidance," "intends," "may," "outlook," "plans," "projects," "seeks," "sees," "should," "targets," "will," "would," or other words of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially from those described in our forward-looking statements are the following: (1) any failure by the 3M Company ("3M") to perform any of its obligations under the various separation agreements in connection with the separation from 3M (the "Spin-Off"); (2) any failure to realize the expected benefits of the Spin-Off; (3) a determination by the IRS or other tax authorities that the Spin-Off or certain related transactions should be treated as taxable transactions; (4) financing transactions undertaken in connection with the Spin-Off and risks associated with additional indebtedness; (5) the risk that incremental costs of operating on a standalone basis (including the loss of synergies), costs of restructuring transactions and other costs incurred in connection with the Spin-Off will exceed Solventum's estimates; (6) the impact of the Spin-Off on its businesses and the risk that the Spin-Off may be more difficult, time-consuming or costly than expected, including the impact on its resources, systems, procedures and controls, diversion of management's attention and the impact on relationships with customers, suppliers, employees and other business counterparties; (7) the effects of, and changes in, worldwide economic, political, regulatory, international, trade and geopolitical conditions, natural disasters, war, and other events beyond Solventum's control; (8) the deployment of artificial intelligence and other emerging technologies in Solventum's products and services or a failure to adapt products and services to such technologies; (9) public health crises; (10) damage to our reputation or our brands; (11) risks from acquisitions, strategic alliances, divestitures and other strategic events, including integration; (12) the success of Solventum's restructuring program; (13) Solventum's ability to access the capital and credit markets and changes in Solventum's credit ratings; (14) exposure to interest rate and currency risks; (15) the highly competitive environment in which Solventum operates and consolidation in the healthcare industry; (16) reduction in customers' research budgets or government funding; (17) the timing and market acceptance of Solventum's new product and service offerings; (18) ongoing working relationships with certain key healthcare professionals; (19) changes in reimbursement practices of governments or private payers or other cost containment measures; (20) Solventum's ability to obtain components or raw materials supplied by third parties and other manufacturing and related supply chain difficulties, interruptions, and disruptive factors; (21) legal and regulatory proceedings and legal compliance risks (including third-party risks) with regards to antitrust, Foreign Corrupt Practices Act and other anti-bribery laws, environmental laws, anti-kickback and false claims laws, privacy laws, tax laws, and other laws and regulations in the United States and other countries in which Solventum operates; (22) potential liabilities related to a broad group of perfluoroalkyl and polyfluoroalkyl substances, collectively known as "PFAS"; (23) climate change and measures to address climate change; (24) risks related to the highly regulated environment in which Solventum operates; (25) risks related to government contracts, public procurement and government reimbursement; (26) risks associated with product liability claims; (27) security breaches and other disruptions to information technology infrastructure; (28) Solventum's failure to obtain, maintain, protect, or effectively enforce its intellectual property rights; (29) any inability to retain key personnel and qualified employees; and (30) our anti-takeover provisions may limit shareholder power.The above list is not exhaustive or necessarily set forth in the order of importance. Forward-looking statements are based on certain assumptions and expectations of future events and trends, and actual future results and trends may differ materially from historical results or those reflected in any such forward-looking statements depending on a variety of factors. A further description of these factors is located under "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in Solventum's periodic reports on file with the U.S. Securities & Exchange Commission. Solventum assumes no obligation to update any forward-looking statements discussed herein as a result of new information, future events or otherwise, except as required by applicable law.Non-GAAP Financial Measures
In addition to reporting financial results in accordance with U.S. GAAP, Solventum also provides non-GAAP measures that we use, and plan to continue using, when monitoring and evaluating operating performance and measuring cash available to invest in our business. The adjusted measures are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP financial measures are supplemental measures of our performance and our liquidity that we believe help investors understand our underlying business performance and Solventum uses these measures as an indication of the strength of Solventum and its ability to generate cash.Solventum calculates forward-looking non-GAAP financial measures, including organic sales growth, adjusted operating income, adjusted operating income margin, adjusted effective tax rate, adjusted diluted earnings per share, and free cash flow based on internal forecasts that omit certain amounts that would be included in GAAP financial measures. Solventum does not provide reconciliations of these forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items. The timing and amounts of these items are uncertain and could have a material impact on Solventum's results in accordance with GAAP.The Q4 2025 financial statements and financial information, including reconciliations of non-GAAP financial measures, are available on Solventum's website: investors.solventum.com.About Solventum
At Solventum, we enable better, smarter, safer healthcare to improve lives. As a new company with a long legacy of creating breakthrough solutions for our customers' toughest challenges, we pioneer game-changing innovations at the intersection of health, material and data science that change patients' lives for the better — while empowering healthcare professionals to perform at their best. See how at Solventum.com.Solventum CorporationCONSOLIDATED STATEMENTS OF INCOME*(Dollars in millions, except per-share data)(Unaudited)
Three months ended
December 31,
Year Ended December 31,
2025
2024
2025
2024
2023Net sales of product
$ 1,490
$ 1,581
$ 6,349
$ 6,348
$ 6,296Net sales of software and rentals
508
493
1,976
1,906
1,901Total net sales
1,998
2,074
8,325
8,254
8,197Cost of product
855
830
3,402
3,172
3,023Cost of software and rentals
116
125
472
489
481Gross profit
1,027
1,119
4,451
4,593
4,693Selling, general and administrative expenses
759
784
3,080
2,782
2,299Research and development expenses
175
199
739
775
758Gain on sale of business
(31)
—
(1,549)
—
(56)Operating income
124
136
2,181
1,036
1,692Interest expense, net
51
107
347
367
—Loss on debt extinguishment, net
—
—
82
—
—Other expense (income), net
14
16
39
64
25Income before income taxes
58
13
1,713
605
1,667Provision for (benefit from) income taxes
(5)
(18)
157
127
321Net Income
$ 63
$ 30
$ 1,556
$ 479
$ 1,346
Earnings per share:
Basic earnings per share
$ 0.36
$ 0.17
$ 8.94
$ 2.77
$ 7.79Diluted earnings per share
0.36
0.17
8.88
2.76
7.79Weighted-average number of shares outstanding:
Basic
174.4
173.4
174.1
173.2
172.7Diluted
175.7
174.5
175.3
173.7
172.7
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum CorporationCONSOLIDATED BALANCE SHEETS*(Dollars in millions, except per-share data)(Unaudited)
December 31,
December 31,
2025
2024Assets
Current assets
Cash and cash equivalents
$ 878
$ 762Accounts receivable — net of allowances of $87 and $86
1,034
1,044Due from related parties
150
185Inventories
Finished goods
636
539Work in process
201
190Raw materials and supplies
229
236Total inventories
1,066
965Other current assets
731
293Total current assets
3,859
3,249Property, plant and equipment — net
1,326
1,622Goodwill
5,704
6,377Intangible assets — net
2,592
2,544Other assets
814
665Total assets
$ 14,294
$ 14,457Liabilities
Current liabilities
Short-term borrowings and current portion of long-term debt
$ —
$ 200Accounts payable
687
618Due to related parties
435
272Unearned revenue
621
572Other current liabilities
1,393
1,041Total current liabilities
3,136
2,703Long-term debt
5,035
7,810Pension and postretirement benefits
363
350Deferred income taxes
164
225Other liabilities
547
410Total liabilities
$ 9,245
$ 11,498
Equity
Common stock, par value $0.01 per share, 750,000,000 shares authorized
$ 2
$ 2Shares issued and outstanding - December 31, 2025: 173,490,864
Shares issued and outstanding - December 31, 2024: 172,785,606
Additional paid-in capital
3,876
3,771Retained earnings
1,797
242Accumulated other comprehensive income (loss)
(625)
(1,056)Total equity
5,049
2,959Total liabilities and equity
$ 14,294
$ 14,457
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum CorporationCONSOLIDATED STATEMENTS OF CASH FLOWS*(Dollars in millions)(Unaudited)
Twelve months ended December 31,
2025
2024
2023Cash Flows from Operating Activities
Net income
$ 1,556
$ 479
$ 1,346Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization
489
555
561Pension and postretirement benefit expense
62
34
41Stock-based compensation expense
161
112
39Gain on sale of business
(1,549)
—
(56)Transaction costs
(111)
—
—Deferred income taxes
(120)
(155)
(142)Changes in assets and liabilities
Accounts receivable
34
43
(129)Due from related parties
44
233
—Inventories
(139)
(132)
23Accounts payable
104
266
105Due to related parties
(11)
(395)
—Accrued compensation
43
78
142All other operating activities — net
(194)
67
(15)Net cash provided by operating activities
369
1,185
1,915
Cash Flows from Investing Activities
Purchases of property, plant and equipment
(379)
(380)
(290)Acquisitions, net of cash acquired
(696)
—
—Proceeds from sale of business
3,890
—
60Other — net
(18)
—
—Net cash provided by (used in) investing activities
2,797
(380)
(230)
Cash Flows from Financing Activities
Repayment of debt
(3,070)
(300)
—Net transfers to 3M
(33)
(8,251)
(1,553)Proceeds from long-term debt, net of issuance costs
—
8,303
—Other — net
46
8
1Net cash used in financing activities
(3,057)
(240)
(1,552)
Effect of exchange rate changes on cash and cash equivalents
7
3
—Net increase (decrease) in cash and cash equivalents
116
568
133Cash and cash equivalents at beginning of year
762
194
61Cash and cash equivalents at end of year
$ 878
$ 762
$ 194*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum CorporationSALES CHANGE ANALYSIS*(Dollars in millions)(Unaudited)Segment and Total Company Net Sales for the Years Ended
Twelve months ended
December 31,
Increase/(Decrease)
2025
2024
Reported
Growth
Currency
Impact
Constant
Currency2
Other3
Organic
GrowthAdvanced Wound Care
$ 1,883
$ 1,835
2.6 %
0.5 %
2.1 %
0.1 %
2.0 %Infection Prevention and Surgical Solutions
2,934
2,802
4.7
0.5
4.2
(0.4)
4.5MedSurg
4,817
4,637
3.9
0.6
3.3
(0.2)
3.5Dental Solutions
1,349
1,295
4.2
1.1
3.1
(0.2)
3.3Health Information Systems
1,360
1,306
4.1
0.2
3.9
—
4.0Total business segment net sales
7,526
7,238
Purification and Filtration
497
709
(29.9)
1.1
(31.0)
(36.5)
5.5All Other4
302
306
(1.5)
0.3
(1.8)
4.3
(6.1)Total Company
$ 8,325
$ 8,254
0.9 %
0.6 %
0.3 %
(3.0) %
3.3 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.
2 Constant currency represents the change in net sales absent the impact on sales from foreign currency translation.
3 Other represents sales impact from acquisitions and divestitures measured separately for the first 12 months post-transaction. Acquisitions include sales of Acera that was acquired in December 2025, non-healthcare related supply agreements that conveyed from 3M to the Company at Spin-Off and sales from new supply agreements with 3M that commenced at Spin-Off. Divestiture impacts include lost sales from the Company's Purification and Filtration business that was sold in September 2025, certain health care businesses retained by 3M India in connection with the Spin-Off, as well as impacts from other immaterial divested businesses.
4 All Other includes the drinking water business, which was previously reported within the Purification and Filtration, and sales related to product supplied to 3M and other supply agreements related to legacy 3M business and assumed by the company at Spin-Off.Solventum Corporation and Subsidiaries
BUSINESS SEGMENTS – (CONTINUED)*
(Unaudited)The Company's operating activities are primarily managed through three segments: MedSurg, Dental Solutions, and Health Information Systems.MedSurg provides:advanced wound care products such as negative pressure wound therapy, advanced wound dressings, advanced skin care, and synthetic tissue matrices; andinfection prevention and surgical solutions products, such as I.V. site management, sterilization assurance, temperature management, surgical supplies, medical tapes and wraps, stethoscopes, medical electrodes, and medical technologies Original Equipment Manufacturer ("OEM").Dental Solutions provides dental and orthodontic products, including brackets, aligners, restorative cements, and bonding agents that span the "life of the tooth," including products designed for preventative dental care, direct and indirect restoration, and broad orthodontic needs.Health Information Systems provides healthcare systems with software solutions – including computer-assisted physician documentation, direct-to-bill and coding automation, classification methodologies, speech recognition, and data visualization platforms – that are designed to eliminate revenue cycle waste, create more time for patient care, and support value-based care.Purification and Filtration consists of filters and membranes for biopharmaceutical and medical technologies, as well as microelectronics and food and beverage that were reported prior to the sale of the business in September 2025.All Other primarily consists of the Water Business that was retained after the sale of the Purification and Filtration Business. All Other also includes sales and cost of sales related to our agreements to supply 3M and other supply agreements assumed by the Company at Spin-Off related to legacy 3M businesses, which were historically included within Corporate and Unallocated.BUSINESS SEGMENT INFORMATION AND DISAGGREGATED NET SALES*
Three months ended December 31,
2025
Three months ended December 31,
2024
(Dollars in millions)
Net Sales
Operating
Income
Operating
Margin %
Net Sales
Operating
Income
Operating
Margin %Advanced Wound Care
$ 483
$ 466
Infection Prevention and Surgical Solutions
752
708
MedSurg
1,235
191
15.5 %
1,174
$ 208
17.8 %Dental Solutions
343
84
24.4
315
73
23.3Health Information Systems
348
133
38.3
336
114
34.1Total reportable segment net sales and operating income
1,926
408
1,825
395
Purification and Filtration
—
—
—
177
12
6.8All Other
72
11
15.3
72
6
8.3Amortization Expense
(77)
(88)
Corporate and Unallocated
(218)
(189)
Total Company
$ 1,998
$ 124
6.2 %
$ 2,074
$ 136
6.6 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum Corporation and SubsidiariesBUSINESS SEGMENTS – (CONTINUED)*(Unaudited)
BUSINESS SEGMENT INFORMATION AND DISAGGREGATED NET SALES*
Twelve months ended December 31,
2025
Twelve months ended December 31,
2024
(Dollars in millions)
Net Sales
Operating
Income
Operating
Margin %
Net Sales
Operating
Income
Operating
Margin %Advanced Wound Care
$ 1,883
$ 1,835
Infection Prevention and Surgical Solutions
2,934
2,802
MedSurg
4,817
$ 810
16.8 %
4,637
$ 887
19.1 %Dental Solutions
1,349
346
25.6
1,295
350
27.0Health Information Systems
1,360
496
36.5
1,306
431
33.0Total reportable segment net sales and operating income
7,526
1,652
7,238
1,668
Purification and Filtration
497
96
19.3
709
74
10.4All Other
302
42
13.9
306
30
9.8Amortization Expense
(312)
(349)
Corporate and Unallocated
702
(387)
Total Company
$ 8,325
$ 2,181
26.2 %
$ 8,254
$ 1,036
12.6 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.Solventum Corporation
SUPPLEMENTAL FINANCIAL INFORMATION
NON-GAAP MEASURES
(Unaudited)In addition to reporting financial results in accordance with U.S. GAAP, the Company uses non-GAAP financial measures to supplement the financial measures prepared in accordance with U.S. GAAP. These include (1) adjusted operating income and adjusted operating income margin, (2) adjusted diluted earnings per share, and (3) free cash flow. Management believes that these non-GAAP financial measures are useful in evaluating current performance and focusing management on our underlying operational results.There are limitations to the use of the non-GAAP financial measures presented in this information statement. These non-GAAP financial measures are not prepared in accordance with U.S. GAAP nor do they have any standardized meaning under U.S. GAAP. In addition, other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non-GAAP financial measures may not be comparable to such similarly titled non-GAAP financial measures used by other companies. Management cautions you not to place undue reliance on these non-GAAP financial measures, but instead to consider them with the most directly comparable U.S. GAAP measure. These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation. These non-GAAP financial measures should be considered supplements to, not substitutes for, or superior to, the corresponding financial measures calculated in accordance with U.S. GAAP.The tables below reconcile our non-GAAP financial measures to the nearest financial measure that is in accordance with U.S. GAAP for the periods presented.Adjusted Operating Income, Adjusted Operating Income Margin and Adjusted Earnings Per Share (Non-GAAP measures)Adjusted operating income and adjusted operating income margin are not defined under U.S. GAAP. Therefore, they should not be considered a substitute for earnings data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Solventum defines adjusted operating income as operating income excluding the effects of amortization, restructuring costs, Spin-Off and separation-related costs, certain litigation-related costs, separation-related impacts due to the sale of the Purification and Filtration business, gain on sale of businesses, and acquisition-related costs. Adjusted operating income margin is adjusted operating income divided by the U.S GAAP measure total net sales for the same period. The company believes adjusted operating income and adjusted operating income margin provide investors with visibility into the company's unleveraged, pre-tax operating results and reflects underlying financial performance. However, adjusted operating income should not be construed as inferring that the company's future results will be unaffected by the items for which the measure adjusts.Adjusted diluted earnings per share is not defined under U.S. GAAP. Therefore, it should not be considered a substitute for earnings data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Solventum defines adjusted diluted earnings per share as net income excluding the after-tax effects of amortization, restructuring costs, Spin-Off and separation-related costs, certain litigation-related costs, legal entity restructuring costs, separation-related impacts due to the sale of the Purification and Filtration business, gain on sale of businesses, acquisition-related costs, and loss on debt extinguishment, net. The company believes adjusted earnings per share provides investors with improved comparability of underlying operating results and a further understanding and additional transparency regarding how the company evaluates the business. However, adjusted earnings per share should not be construed as inferring that the company's future results will be unaffected by the items for which the measure adjusts.Solventum CorporationSUPPLEMENTAL FINANCIAL INFORMATIONNON-GAAP MEASURES – (CONTINUED)*(Unaudited)
Three months ended December 31, 2025(Dollars in millions, except per share amounts)
Net sales
Cost of
Sales5
Gross
Margin %
Operating
Expenses6
Operating
Income
Operating
Income
Margin %
Non-
Operating
Expense
(Income),
net7
Income
Before
Income
Taxes
Net Income
Attributable
to
Solventum
Diluted
EPS
Effective
Tax RateGAAP
$ 1,998
$ 971
51.4 %
$ 934
$ 124
6.2 %
$ 65
$ 58
$ 63
$ 0.36
(8.3) %Non-GAAP Adjustments:
Amortization of acquisition-related intangible assets
—
—
(77)
77
3.8
—
77
65
0.37
Restructuring costs (a)
(1)
—
(51)
52
2.6
—
52
40
0.23
3M spin-off and separation-related costs (b)
(42)
2.1
(104)
146
7.3
—
146
111
0.63
Certain litigation-related costs (d)
—
—
(22)
22
1.1
—
22
16
0.09
Purification and Filtration separation-related (e)
1
—
4
(5)
(0.3)
—
(5)
(5)
(0.03)
Gain on sale of business(f)
—
—
—
(31)
(1.6)
—
(31)
(22)
(0.13)
Acquisition-related costs(g)
—
—
(12)
12
0.6
—
12
9
0.05
Non-GAAP
$ 1,998
$ 929
53.5 %
$ 672
$ 397
19.9 %
$ 65
$ 332
$ 277
$ 1.57
16.6 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.
Three months ended December 31, 2024(Dollars in millions, except per share amounts)
Net sales
Cost of
Sales5
Gross
Margin %
Operating
Expenses6
Operating
Income
Operating
Income
Margin %
Non-
Operating
Expense
(Income),
net7
Income
Before
Income
Taxes
Net Income
Attributable
to
Solventum
Diluted
EPS
Effective
Tax RateGAAP
$ 2,074
$ 955
54.0 %
$ 983
$ 136
6.6 %
$ 123
$ 13
$ 30
$ 0.17
(142.0) %Non-GAAP Adjustments:
Amortization of acquisition-related intangible assets
—
—
(88)
88
4.2
—
88
73
0.42
Restructuring costs (a)
(23)
1.0
(42)
65
3.1
—
65
53
0.30
3M spin-off and separation-related costs (b)
(24)
1.2
(108)
132
6.4
—
132
99
0.57
Legal entity restructuring (c)
—
—
—
—
—
—
—
(10)
(0.06)
Non-GAAP
$ 2,074
$ 908
56.2 %
$ 745
$ 422
20.4 %
$ 123
$ 299
$ 247
$ 1.41
17.4 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.(a)2025 restructuring costs primarily related to the Company's Transform for the Future program. Includes employee termination costs of $42 million and other costs of $11 million, which includes third-party consulting and compensation for employees dedicated to the program. 2024 restructuring costs primarily relate to the Company's Solventum Way program. Includes employee termination costs of $46 million and other costs of $16 million, which includes asset write-offs and other contractual third party termination costs.(b)Consists of costs specifically incurred in connection with the Company's separation from 3M.(c)Reflects the tax impacts for legal entity restructuring in connection with the separation from 3M.(d)Consists of charges and recoveries related to certain litigation business and related transaction cost.(e)Costs related to the separation of the Company's Purification and Filtration business, including legal, finance and tax advisory, and information technology-related.(f)Primarily related to the sale of a business within the Company's Health Information Systems clinician solutions portfolio. (g)Transaction costs and employee retention related to the acquisition of Acera Surgical.
5 Cost of sales is the combination of cost of product and cost of software and rentals line items from the Consolidated Statements of Income and represents the total company cost of sales.6 Operating expenses is the combination of selling, general and administrative expenses and research and development expenses from the Consolidated Statements of Income and represents the total company other operating expenses.7 Non-operating expense (income), net is the combination of interest expense, net, loss on debt extinguishment, net, and other expense (income), net line items from the Consolidated Statements of Income and represents the total company non-operating expense. Solventum CorporationSUPPLEMENTAL FINANCIAL INFORMATIONNON-GAAP MEASURES – (CONTINUED)*(Unaudited)
Twelve months ended December 31, 2025(Dollars in millions, except per share amounts)
Net sales
Cost of
Sales5
Gross
Margin %
Operating
Expenses6
Operating
Income
Operating
Income
Margin %
Non-Operating
Expense
(Income),
net7
Income
Before
Income
Taxes
Net Income
Attributable
to
Solventum
Diluted
EPS
Effective
Tax RateGAAP
$ 8,325
$ 3,874
53.5 %
$ 3,819
$ 2,181
26.2 %
$ 468
$ 1,713
$ 1,556
$ 8.88
9.2 %Non-GAAP Adjustments:
Amortization of acquisition-related intangible assets
—
—
—
(312)
312
3.7
—
312
264
1.50
Restructuring costs (a)
—
(10)
0.1
(70)
80
1.0
—
80
60
0.34
3M spin-off and separation-related costs (b)
—
(139)
1.7
(439)
579
7.0
—
579
444
2.54
Certain litigation-related costs (d)
—
—
—
(51)
51
0.6
—
51
38
0.22
Purification and Filtration separation-related (e)
—
1
—
(45)
44
0.5
—
44
33
0.19
Gain on sale of business(f)
—
—
—
—
(1,549)
(18.6)
—
(1,549)
(1,397)
(7.97)
Loss on debt extinguishment, net(h)
—
—
—
—
—
—
(82)
82
62
0.35
Acquisition-related costs(g)
(12)
12
0.1
—
12
9
0.05
Non-GAAP
$ 8,325
$ 3,725
55.2 %
$ 2,890
$ 1,709
20.5 %
$ 386
$ 1,324
$ 1,070
$ 6.11
19.1 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.
Twelve months ended December 31, 2024(Dollars in millions, except per share amounts)
Net sales
Cost of
Sales5
Gross
Margin %
Operating
Expenses6
Operating
Income
Operating
Income
Margin %
Non-
Operating
Expense
(Income),
net7
Income
Before
Income
Taxes
Net Income
Attributable
to
Solventum
Diluted
EPS
Effective
Tax RateGAAP
$ 8,254
$ 3,661
55.6 %
$ 3,557
$ 1,036
12.6 %
$ 431
$ 605
$ 479
$ 2.76
20.9 %Non-GAAP Adjustments:
Amortization of acquisition-related intangible assets
—
—
—
(349)
349
4.2
—
349
291
1.68
Restructuring costs (a)
—
(28)
0.3
(50)
78
0.9
—
78
61
0.35
3M spin-off and separation-related costs (b)
—
(74)
0.9
(275)
349
4.2
(38)
387
306
1.76
Legal entity restructuring (c)
—
—
—
—
—
—
—
—
25
0.14
Non-GAAP
$ 8,254
$ 3,559
56.9 %
$ 2,882
$ 1,812
22.0 %
$ 392
$ 1,419
$ 1,162
$ 6.70
18.1 %
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.(a)2025 restructuring costs primarily related to the Company's Transform for the Future program and Solventum way program. Includes employee termination costs of $70 million and other costs of $10 million, which includes third-party consulting and compensation for employees dedicated to the program. 2024 restructuring costs primarily relate to the Company's Solventum Way program. Includes employee termination costs of $62 million and other costs of $16 million, which includes asset write-offs and other contractual third party termination costs.(b)Consists of costs specifically incurred in connection with the Company's separation from 3M.(c)Reflects the tax impacts for legal entity restructuring in connection with the separation from 3M.(d)Consists of charges and recoveries related to certain litigation business and related transaction cost.(e)Costs related to the separation of the Company's Purification and Filtration business, including legal, finance and tax advisory, and information technology-related.(f)Gain on sale of the Purification and Filtration business, net of applicable tax impacts, in addition to a business in the Health Information Systems business .(g)Transaction and employee retention costs related to the acquisition of Acera Surgical.(h)Premium paid and related expenses incurred in connection with tender of debt, net of gains from related interest rate hedging contracts.
5 Cost of sales is the combination of cost of product and cost of software and rentals line items from the Consolidated Statements of Income and represents the total company cost of sales.6 Operating expenses is the combination of selling, general and administrative expenses and research and development expenses from the Consolidated Statements of Income and represents the total company other operating expenses.7 Non-operating expense (income), net is the combination of interest expense, net, loss on debt extinguishment, net, and other expense (income), net line items from the Consolidated Statements of Income and represents the total company non-operating expense.Solventum Corporation
SUPPLEMENTAL FINANCIAL INFORMATION
NON-GAAP MEASURES – (CONTINUED)*
(Unaudited)Free Cash Flow (non-GAAP measure):Free cash flow is not defined under U.S. GAAP. Therefore, it should not be considered a substitute for income or cash flow data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. The company defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. The company believes free cash flow is meaningful to investors as it is a useful measure of liquidity and the company uses these measures as an indication of the strength of the company and its ability to generate cash. Free cash flow varies across quarters throughout the year. Below find a recap of free cash flow.(Dollars in millions)
Three months ended
December 31,
Twelve months ended
December 31,Major GAAP Cash Flow Categories
2025
2024
2025
2024Net cash provided by operating activities
$ 96
$ 219
$ 369
$ 1,185Net cash provided by (used in) investing activities
(746)
(127)
2,797
(380)Net cash used in financing activities
(115)
(104)
(3,057)
(240)
Free Cash Flow (non-GAAP measure)
Net cash provided by operating activities
$ 96
$ 219
$ 369
$ 1,185Purchases of property, plant and equipment
(63)
(127)
(379)
(380)Free cash flow
33
92
(10)
805
*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum.
View original content to download multimedia:https://www.prnewswire.com/news-releases/solventum-reports-fourth-quarter-2025-financial-results-and-introduces-2026-full-year-guidance-302698672.htmlSOURCE Solventum
Original: Solventum Reports Fourth Quarter 2025 Financial Results and Introduces 2026 Full-Year Guidance
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