In the fiscal second quarter of 2026, the Company initiated a supply chain restructuring program primarily in the Innovative Medicine segment to exit certain manufacturing locations as part of its optimization efforts to streamline operations. The program is expected to be substantially complete by the end of 2029 with estimated costs between $650 million and $750 million, and include site and supplier exit costs, decommissioning and asset impairments costs. Restructuring expenses of $200 million, primarily related to asset impairments, were recorded in the fiscal second quarter of 2026.

In fiscal 2025, the Company initiated a restructuring program of its Surgery franchise within the MedTech segment to simplify and focus operations by exiting certain non-strategic product lines and optimize select sites across the network. The pre-tax restructuring expense in the fiscal second quarter of 2026 primarily included costs related to product exits. Total project costs of approximately $0.3 billion have been recorded since the restructuring was announced. The estimated costs of the total program are between $0.6 billion - $0.7 billion and is expected to be substantially completed by the end of fiscal year 2026.

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. The pre-tax restructuring expense in the fiscal second quarter of 2026 primarily included costs related to market and product exits. The pre-tax restructuring expense in the fiscal second quarter of 2025 primarily included costs related to market and product exits. Total project costs of approximately $0.8 billion have been recorded since the restructuring was announced. This program will be completed as of the fourth quarter of 2026 at a total cost of approximately $1.0 billion.


(Pre-tax Dollars in Millions)	Q2 2026	Q2 2025	Q2 YTD 2026	Q2 YTD 2025
Innovative Medicine supply chain(1)	$200	—	200	—
MedTech Segment Surgery franchise(2)	59	29	114	29
MedTech Segment Orthopaedics franchise(3)	17	50	24	105

Total Programs	$276	79	338	134

(1)Included $18 million in Cost of products sold and $182 million in Other (Income)/Expense on the Consolidated Statement of Earnings in the fiscal second quarter and fiscal six months of 2026.

(2)Included $31 million in Restructuring, $4 million in Cost of products sold and $24 million in Other (Income)/Expense on the Consolidated Statement of Earnings in the fiscal second quarter of 2026. Included $61 million in Restructuring, $24 million in Cost of products sold and $29 million in Other (Income)/Expense on the Consolidated Statement of Earnings in the fiscal six months of 2026. Included $29 million in Restructuring on the Consolidated Statement of Earnings in the fiscal second quarter and fiscal six months of 2025.

(3)Included $3 million in Restructuring, $13 million in Cost of products sold and $1 million in Other (Income)/Expense on the Consolidated Statement of Earnings in the fiscal second quarter of 2026. Included $5 million in Restructuring, $18 million in Cost of products sold and $1 million in Other (Income)/Expense on the Consolidated Statement of Earnings in the fiscal six months of 2026. Included $35 million in Restructuring and $15 million in Cost of products sold on the Consolidated Statement of Earnings in the fiscal second quarter of 2025. Included $52 million in Restructuring, $23 million in Cost of products sold and $30 million in Other (Income)/Expense on the Consolidated Statement of Earnings in the fiscal six months of 2025.