SEC Form 10-Q filed by Solventum Corporation

5/9/25 12:24:15 PM ET

$SOLV

Medical/Dental Instruments

Health Care

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solv-20250331

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number: 001-41968

SOLVENTUM CORPORATION

(Exact name of registrant as specified in its charter)


Delaware						92-2008841
(State or other jurisdiction of incorporation)						(IRS Employer Identification No.)

3M Center, Building 275-6W 2510 Conway Avenue East, Maplewood, Minnesota						55144
(Address of Principal Executive Offices)						(Zip Code)

(Registrant’s Telephone Number, Including Area Code) (651) 733-1110

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, Par Value $.01 Per Share

SOLV

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”" “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:


Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class						Outstanding at April 30, 2025
Common Stock, $0.01 par value per share						173,012,922

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SOLVENTUM CORPORATION

Form 10-Q for the period ended March 31, 2025


TABLE OF CONTENTS			PAGE
PART I. Financial Information			3
Item 1. Financial Statements			3
Condensed Consolidated Statements of Income (Unaudited)			3
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)			4
Condensed Consolidated Balance Sheets (Unaudited)			5
Condensed Consolidated Statements of Changes in Equity (Unaudited)			6
Condensed Consolidated Statements of Cash Flows (Unaudited)			7
Notes to the Condensed Consolidated Financial Statements (Unaudited)			8
NOTE 1. Significant Accounting Policies			8
NOTE 2. Revenue Recognition			9
NOTE 3. Acquisitions and Divestitures			9
NOTE 4. Goodwill and Intangible Assets			10
NOTE 5. Other Current Liabilities			11
NOTE 6. Property, Plant, and Equipment - Net			11
NOTE 7. Comprehensive Income Information			12
NOTE 8. Income Taxes			13
NOTE 9. Long-Term Debt and Short-Term Borrowings			13
NOTE 10. Pension and Postretirement Benefit Plans			14
NOTE 11. Derivatives			16
NOTE 12. Commitments and Contingencies			18
NOTE 13. Restructuring			20
NOTE 14. Earnings Per Share			21
NOTE 15. Stock-Based Compensation			22
NOTE 16. Related Parties			22
NOTE 17. Business Segments			24
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			26
Overview			26
Results of Operations			28
Performance by Business Segment			29
Financial Condition and Liquidity			33
Cautionary Note Concerning Forward Looking Statements			35
Item 3. Quantitative and Qualitative Disclosures About Market Risk			36
Item 4. Controls and Procedures			36
PART II. Other Information			37
Item 1. Legal Proceedings			37
Item 1A. Risk Factors			37
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			37
Item 3. Defaults Upon Senior Securities			37
Item 4. Mine Safety Disclosures			37
Item 5. Other Information			37
Item 6. Exhibits			38

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SOLVENTUM CORPORATION

FORM 10-Q

For the Quarterly Period Ended March 31, 2025

PART I. Financial Information

Item 1. Financial Statements

Solventum Corporation

Condensed Consolidated Statements of Income (Unaudited)



	Three months ended March 31,
(Millions, except per share data)	2025		2024
Net sales of product	$	1,597	$	1,553
Net sales of software and rentals	473		463
Total net sales	2,070		2,016
Cost of product	835		725
Cost of software and rentals	121		119
Gross profit	1,114		1,172
Selling, general and administrative expenses	769		596
Research and development expenses	193		195

Operating income	152		381
Interest expense, net	104		39
Other expense (income), net	11		13
Income before income taxes	38		329
Provision for (benefit from) income taxes	(99)		92
Net income	$	137	$	237

Earnings per share:
Basic earnings per share	$	0.79	$	1.37
Diluted earnings per share	0.78		1.37
Weighted-average number of shares outstanding:
Basic	173.7		172.7
Diluted	174.8		172.7

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Solventum Corporation

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)



	Three months ended March 31,
(Millions)	2025		2024
Net income	$	137	$	237
Other comprehensive income (loss), net of tax:
Cumulative translation adjustment	154		(86)
Defined benefit pension and postretirement plans	14		—
Cash flow hedging instruments	(11)		—
Total other comprehensive income (loss), net of tax	157		(86)
Comprehensive income	$	294	$	151

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Solventum Corporation

Condensed Consolidated Balance Sheets (Unaudited)


	March 31,		December 31,
(Millions, except share information)	2025		2024
Assets
Current assets
Cash and cash equivalents	$	534	$	762
Accounts receivable — net of allowances of $83 and $86	926		1,044
Due from related parties	185		185
Inventories
Finished goods	484		539
Work in process	171		190
Raw materials and supplies	211		236
Total inventories	866		965
Other current assets	249		293
Current assets held for sale	293		—
Total current assets	3,053		3,249
Property, plant and equipment — net	1,198		1,622
Goodwill	4,991		6,377
Intangible assets — net	2,365		2,544
Other assets	814		665
Non-current assets held for sale	2,106		—
Total assets	$	14,527	$	14,457
Liabilities
Current liabilities
Short-term borrowings and current portion of long-term debt	$	100	$	200
Accounts payable	604		618
Due to related parties	356		272
Unearned revenue	558		572
Other current liabilities	891		1,041
Current liabilities held for sale	57		—
Total current liabilities	2,566		2,703
Long-term debt	7,813		7,810
Pension and postretirement benefits	334		350
Deferred income taxes	226		225
Other liabilities	279		410
Non-current liabilities held for sale	47		—
Total liabilities	$	11,265	$	11,498
Commitments and contingencies (Note 12)
Equity









Common stock, par value $0.01 per share, 750,000,000 shares authorized	$	2	$	2
Shares issued and outstanding - March 31, 2025: 173,008,211
Shares issued and outstanding - December 31, 2024: 172,785,606
Additional paid-in-capital	3,781		3,771
Retained earnings	378		242

Accumulated other comprehensive income (loss)	(899)		(1,056)

Total equity	3,262		2,959
Total liabilities and equity	$	14,527	$	14,457

The accompanying notes are an integral part of these condensed consolidated financial statements.

Solventum Corporation

Condensed Consolidated Statements of Changes in Equity (Unaudited)

Three Months Ended March 31, 2025 and March 31, 2024


	Common Stock
(Millions)	Shares Outstanding	Par Value		Additional Paid-In-Capital		Retained Earnings		Net Parent Investment		Accumulated Other Comprehensive Income (Loss)		Total
Balance at December 31, 2024	173	$	2	$	3,771	$	242	$	—	$	(1,056)	$	2,959
Net income	—	—		—		137		—		—		137




Other comprehensive income (loss), net of tax	—	—		—		—		—		157		157
Net transfers to 3M	—	—		(31)		—		—		—		(31)
Stock-based compensation	—	—		49		—		—		—		49
Common stock for tax withholding obligations	—	—		(8)		—		—		—		(8)

Balance at March 31, 2025	173	$	2	$	3,781	$	378	$	—	$	(899)	$	3,262

Balance at December 31, 2023	—	$	—	$	—	$	—	$	12,003	$	(337)	$	11,666
Net income	—	—		—		—		237		—		237




Other comprehensive income (loss), net of tax	—	—		—		—		—		(86)		(86)
Net transfers to 3M	—	—		—		—		(7,431)		(535)		(7,966)



Balance at March 31, 2024	—	$	—	$	—	$	—	$	4,809	$	(958)	$	3,851

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Solventum Corporation

Condensed Consolidated Statements of Cash Flows (Unaudited)



	Three months ended March 31,
(Millions)	2025		2024
Cash Flows from Operating Activities
Net income	$	137	$	237
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	129		139
Pension and postretirement benefit expense	15		9
Stock-based compensation expense	49		4

Deferred income taxes	(144)		(25)
Changes in assets and liabilities
Accounts receivable	6		78
Due from related parties	5		—
Inventories	(32)		(52)
Accounts payable	9		115
Due to related parties	(6)		—
Accrued compensation	(95)		(46)
All other operating activities	(44)		(17)
Net cash provided by operating activities	29		442

Cash Flows from Investing Activities
Purchases of property, plant and equipment	(109)		(102)

Other — net	(5)		—
Net cash used in investing activities	(114)		(102)

Cash Flows from Financing Activities
Repayment of debt	(100)		—
Net transfers to 3M	(31)		(7,851)
Proceeds from long-term debt, net of issuance costs	—		8,303
Other — net	(8)		10
Net cash (used in) provided by financing activities	(139)		462

Effect of exchange rate changes on cash and cash equivalents	1		—

Net increase (decrease) in cash and cash equivalents	(223)		802
Cash and cash equivalents at beginning of period	762		194
Less: Cash and cash equivalents within held for sale	(5)		—
Cash and cash equivalents at end of period	$	534	$	996

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Solventum Corporation

Notes to the Condensed Consolidated Financial Statements (Unaudited)

NOTE 1. Significant Accounting Policies

Organization and Description of Business

Solventum Corporation (“Solventum” or the “Company”) was a carve-out business of 3M Company (“3M”). On April 1, 2024 (the “Distribution Date”), 3M completed the previously announced spin-off of Solventum Corporation (the “Spin-Off”). The Spin-Off was completed through a distribution of approximately 80.1% of the Company’s outstanding common stock to holders of record of 3M’s common stock as of the close of business on March 18, 2024 (the “Distribution”), which resulted in the issuance of 172,709,505 shares of common stock. As a result of the Distribution, the Company became an independent public company. Solventum’s common stock is listed under the symbol “SOLV” on the New York Stock Exchange (“NYSE”).

Solventum is a leading global healthcare company with a broad portfolio of trusted solutions that leverage deep material science, data science, and digital capabilities to address critical customer needs. Solventum is organized into four operating business segments that are aligned with the end markets that the Company serves: MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration.

On February 25, 2025, the Company entered into a definitive agreement to sell its Purification and Filtration business to Thermo Fisher Scientific Inc. for $4.1 billion. Refer to Note 3, "Acquisitions and Divestitures" for additional information.

Basis of Presentation

The unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) and present the financial position, results of operations, and cash flows for the periods presented. The interim condensed consolidated financial statements are unaudited but, in the opinion of management, reflect all adjustments necessary for a fair statement of the Company’s consolidated financial position, results of operations and cash flows for the periods presented. These adjustments consist of normal, recurring items. The results of operations for any interim periods are not necessarily indicative of results for the full year.

Effective April 1, 2024, the Company’s financial statements are presented on a consolidated basis, as the Spin-Off was completed on such date. Prior to April 1, 2024, Solventum was a carve-out business of 3M. The Company's financial statements prior to April 1, 2024 were prepared on a combined basis and were derived from the consolidated financial statements and accounting records of 3M, including the historical cost basis of assets and liabilities comprising the Company, as well as the historical revenues, direct costs, and allocations of indirect costs attributable to the operations of the Company, using the historical accounting policies applied by 3M. The financial statements included in this interim report are referred to as the “Condensed Consolidated Financial Statements” for all periods presented.

Amounts reported within this interim report are rounded to the nearest million and the sum of the components may not equal the total amount reported due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding.

All intercompany transactions and balances within Solventum have been eliminated. These unaudited condensed consolidated financial statements include certain transactions with 3M, which are disclosed as related party transactions in Note 16, “Related Parties”.

The unaudited condensed consolidated financial statements and related notes should be read in conjunction with the audited consolidated financial statements and related notes included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the “2024 Annual Report”).

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New Accounting Pronouncements

The table below provides summaries of recently issued financial accounting standards.


Standard	Relevant Description	Effective Date for Solventum	Impact of Adoption

ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures	Issued in December 2023. Requires disaggregated information about a Company's effective tax rate reconciliation as well as information on income taxes paid.	Year-end December 31, 2025	The Company is currently assessing the impact that the updated standard will have on financial statement disclosures.
ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses	Issued in November 2024. Requires additional disclosure of the nature of expenses included in the income statement.	Year-end December 31, 2026	The Company is currently assessing the impact that the updated standard will have on financial statement disclosures.

NOTE 2. Revenue Recognition

Contract Balances

Unearned revenue primarily relates to revenue that is recognized over time for one-year software license contracts. Approximately $220 million of the December 31, 2024 balance was recognized as revenue during the three months ended March 31, 2025, while approximately $240 million of the December 31, 2023 balance was recognized as revenue during the three months ended March 31, 2024.

Operating Lease Revenue

Sales of software and rental includes rental revenue from durable medical devices as part of operating lease arrangements (reported within the MedSurg segment), which was $144 million for the three months ended March 31, 2025, and $146 million for the three months ended March 31, 2024.

Customer Concentration

No customer accounted for more than 10% of the Company’s revenues for the three months ended March 31, 2025 or 2024. Additionally, no customers accounted for more than 10% of accounts receivable as of March 31, 2025 or December 31, 2024.

NOTE 3. Acquisitions and Divestitures

Acquisitions

The Company had no acquisitions during the three months ended March 31, 2025 or 2024.

Divestitures

On February 25, 2025, the Company entered into a definitive agreement to sell its Purification and Filtration business to Thermo Fisher Scientific Inc. for $4.1 billion. The closing of the transaction is expected to be completed by the end of the 2025 calendar year, subject to regulatory approvals and customary closing conditions.

The Company concluded that the Purification and Filtration business met the criteria to be classified as held for sale in February 2025. Accordingly, the Company has separately reflected the held for sale assets and liabilities of the Purification and Filtration business on its condensed consolidated balance sheets as of March 31, 2025.

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The major classes of assets and liabilities classified as held for sale are as follows:


	March 31,
(Millions)	2025
Accounts receivables — net of allowances	$	127
Inventories	144
Other current assets	22
Current assets held for sale	293
Property, plant and equipment — net	503
Goodwill	1,494
Intangible assets — net	106
Other assets	3
Non-current assets held for sale	2,106
Accounts payable	17
Other current liabilities	40
Current liabilities held for sale	57
Pension and postretirement benefits	29
Other liabilities	18
Non-current liabilities held for sale	$	47

The Company determined that the sale of the Purification and Filtration business did not meet the criteria to be reported as discontinued operations. A component of an entity is reported in discontinued operations after meeting the criteria for held for sale classification if the disposition represents a strategic shift that has (or will have) a major effect on the entity's operations and financial results. The Company analyzed the quantitative and qualitative factors relevant to the divestiture of the Purification and Filtration business, including its significance to the Company’s overall strategy, net sales and operating income, and determined that those conditions for discontinued operations presentation had not been met.

NOTE 4. Goodwill and Intangible Assets

Goodwill

There was no goodwill recorded from acquisitions during the three months ended March 31, 2025.

The goodwill balance by business segment is as follows:


(Millions)	MedSurg		Dental Solutions		Health Information Systems		Purification and Filtration		Total
Balance as of December 31, 2024	$	3,597	$	439	$	871	$	1,470	$	6,377
Translation impact	70		13		1		24		108
Amount reclassified as held for sale	—		—		—		(1,494)		(1,494)
Balance as of March 31, 2025	$	3,667	$	452	$	872	$	—	$	4,991

Acquired Intangible Assets: The carrying amount and accumulated amortization of acquired finite-lived intangible assets are as follows:


	March 31,		December 31,
(Millions)	2025		2024
Customer related intangible assets	$	2,366	$	2,720
Patents and other technology-based intangible assets	1,781		1,895
Tradenames and other amortizable intangible assets	634		729
Total gross carrying amount	4,781		5,344

Accumulated amortization — customer related	(985)		(1,208)
Accumulated amortization — patents and other technology-based	(1,146)		(1,224)
Accumulated amortization — tradenames and other	(285)		(368)
Total accumulated amortization	(2,416)		(2,800)




Total intangible assets — net	$	2,365	$	2,544

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Amortization expense was as follows:



	Three months ended March 31,
(Millions)	2025		2024
Amortization expense	$	81	$	87

Expected amortization expense for acquired amortizable intangible assets recorded as of March 31, 2025 is as follows:


(Millions)	Remainder of 2025		2026		2027		2028		2029		2030		After 2030
Amortization expense	$	228	$	306	$	298	$	294	$	256	$	151	$	832

NOTE 5. Other Current Liabilities

Other current liabilities included in the condensed consolidated balance sheets consist of the following:


	March 31,		December 31,
(Millions)	2025		2024
Other current liabilities
Accrued compensation and withholdings	$	217	$	309
Accrued taxes	140		122
Accrued rebates	139		146
Accrued interest	64		114
Other	331		350
Total other current liabilities	$	891	$	1,041

NOTE 6. Property, Plant, and Equipment - Net

Property, plant and equipment - net consisted of the following:


	March 31,		December 31,
(Millions)	2025		2024
Property, plant and equipment - at cost
Buildings and leasehold improvements	$	784	$	956
Machinery and equipment	1,705		2,150
Construction in progress	375		504
Gross property, plant and equipment	2,864		3,610
Accumulated depreciation	(1,666)		(1,988)
Property, plant and equipment - net	$	1,198	$	1,622

Depreciation expense consisted of the following:



	Three months ended March 31,
(Millions)	2025		2024
Depreciation expense	$	42	$	44

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NOTE 7. Comprehensive Income Information

Changes in Accumulated Other Comprehensive Income (Loss) by Component

The table below presents the changes in accumulated other comprehensive income (loss) (“AOCI”), including the reclassifications out of AOCI by component:

Three months ended March 31, 2025


(Millions)	Cumulative Translation Adjustment		Defined Benefit Pension and Postretirement Plans		Cash Flow Hedging		Total Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2024, net of tax:	$	(550)	$	(526)	$	20	$	(1,056)
Other comprehensive income (loss), before tax:
Amounts before reclassifications	151		—		(11)		140
Amounts reclassified out	—		19		(3)		16
Total other comprehensive income (loss), before tax	151		19		(14)		156
Tax effect	3		(5)		3		1
Total other comprehensive income (loss), net of tax	154		14		(11)		157

Balance at March 31, 2025, net of tax:	$	(396)	$	(512)	$	9	$	(899)

Three months ended March 31, 2024


(Millions)	Cumulative Translation Adjustment		Defined Benefit Pension and Postretirement Plans		Cash Flow Hedging		Total Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2023, net of tax:	$	(347)	$	10	$	—	$	(337)
Other comprehensive income (loss), before tax:
Amounts before reclassifications	(98)		—		—		(98)
Amounts reclassified out	12		—		—		12
Total other comprehensive income (loss), before tax	(86)		—		—		(86)
Tax effect	—		—		—		—
Total other comprehensive income (loss), net of tax	(86)		—		—		(86)
Transfers from 3M, net of tax	—		(535)		—		(535)
Balance at March 31, 2024, net of tax:	$	(433)	$	(525)	$	—	$	(958)

Additional details on the amounts reclassified from AOCI into consolidated income include:

•Cumulative translation adjustment: amounts were reclassified into other expense (income), net and were related to charges associated with the substantial liquidation of foreign operations completed as part of our separation from 3M.

•Defined benefit pension and postretirement plans: amounts were reclassified into other expense (income), net (see Note 10).

•Cash flow hedging: foreign currency forward contracts amounts were reclassified into cost of sales (see Note 11).

•The tax effects, if applicable, associated with these reclassifications were reflected in provision for (benefit from) income taxes.

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NOTE 8. Income Taxes

The Company’s income tax provision through March 31, 2024 was prepared on a separate return basis. The income tax provision post Spin-Off is prepared based on a stand-alone basis.

The effective tax rates for the three months ended March 31, 2025 and 2024 were (262.1)% and 28.0%, respectively. The decrease in our effective tax rate is primarily due to tax benefit on the expected divestiture of the Purification and Filtration business and a different geographic mix of earnings.

In 2021, the Organisation for Economic Co-operation and Development (“OECD”) announced Pillar Two Model Rules which call for the taxation of large multinational corporations at a global minimum tax rate of 15%. Many non-U.S. tax jurisdictions, including Ireland, have either recently enacted legislation to adopt certain components of the Pillar Two Model Rules beginning in fiscal year 2024 or announced their plans to enact legislation in future years. In the three months ended March 31, 2025, the Company incurred an insignificant tax impact in connection with Pillar Two.

The Company’s income tax provision or benefit for the interim periods is determined based on an estimated annual effective tax rate, adjusted for discrete items. Because significant foreign earnings are generated by the Company’s subsidiaries organized in jurisdictions with lower statutory tax rates, the Company’s estimated annual effective tax rate may be materially impacted if earnings in these lower-tax jurisdictions fluctuate.

The Company recognizes deferred tax assets to the extent that it believes these assets are more likely than not to be realized based on evaluation of all available positive and negative evidence. On the basis of this evaluation, the Company continues to maintain a valuation allowance to reduce its deferred tax assets to the amount realizable.

NOTE 9. Long-Term Debt and Short-Term Borrowings

Carrying value includes the impact of debt issuance costs. Long-term debt and short-term borrowings as of March 31, 2025 and December 31, 2024 consisted of the following:


(Millions)	Currency/ Fixed vs. Floating	Effective Interest Rate		Final Maturity Date	Carrying Value
Description					March 31, 2025		December 31, 2024
Eighteen month senior term loan credit facility	USD Floating	5.79	%	2025	$	100	$	200
Three year senior term loan credit facility	USD Floating	5.79		2027	979		979
$1 billion 5.45 percent three year senior notes	USD Fixed	5.37		2027	995		995
$1.5 billion 5.40 percent five year senior notes	USD Fixed	5.30		2029	1,488		1,487
$1 billion 5.45 percent seven year senior notes	USD Fixed	5.35		2031	991		990
$1.65 billion 5.60 percent ten year senior notes	USD Fixed	5.54		2034	1,636		1,636
$1.25 billion 5.90 percent thirty year senior notes	USD Fixed	6.01		2054	1,232		1,231
$500 million 6.00 percent forty year senior notes	USD Fixed	6.15		2064	492		492
Other borrowings					—		—
Total long-term debt					7,913		8,010
Less: current portion of long-term debt					100		200
Long-term debt (excluding current portion)					$	7,813	$	7,810

Senior Notes

The Company’s borrowings include $6.9 billion aggregate principal amount of senior notes in six series with maturity dates ranging from 2027 through 2064 (collectively, the “Senior Notes”). The Senior Notes are governed by an indenture and supplemental indenture between the Company and a trustee (collectively, the “Indenture”). The Indenture contains certain customary affirmative and negative covenants, including restrictions on the Company’s ability to consolidate, merge, convey, transfer or lease substantially all of its assets. In addition, the Indenture contains other customary terms, including certain events of default, upon the occurrence of which the Senior Notes may be declared immediately due and payable. The Company is in compliance with all covenants related to the Senior Notes.

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Credit Facilities

On February 16, 2024, the Company entered into credit agreements providing for:

•a five year senior unsecured revolving credit facility in an aggregate committed amount of $2.0 billion expiring in 2029 (the “5-year Revolving Credit Facility”); and

•an eighteen month senior unsecured term loan credit facility in an aggregate principal amount of $500 million and a three year senior unsecured term credit loan facility in an aggregate principal amount of $1.0 billion (together, the “Term Loan Credit Facilities,” and together with the 5-Year Revolving Credit Facility, the “Credit Facilities”).

The Company intends to use the Credit Facilities for general corporate purposes. At March 31, 2025, there are no amounts outstanding under the 5-year Revolving Credit Facility. On March 7, 2024, the Company drew on the Term Loan Credit Facilities in the amount of $1.48 billion. These Term Loan Credit Facilities have a floating interest rate based on a Secured Overnight Financing Rate (“SOFR”) index.

In March 2025, the Company paid $100 million of the aggregate principal amount outstanding under the eighteen month senior unsecured term loan credit facility.

Commercial Paper

On March 4, 2024, the Company entered into a commercial paper program that allows it to issue up to $2.0 billion aggregate principal amount of short-term notes to finance short-term liabilities. Any such issuance will mature within 364 days from date of issue. There was no commercial paper outstanding as of March 31, 2025.

Future Maturities of Long-term Debt: Maturities of long-term debt in the table below reflect the impact of repayment such that total maturities equal the contractual value of long-term debt net of amounts repaid as of March 31, 2025. The maturities of long-term debt for the periods subsequent to March 31, 2025 are as follows (in millions):


Remainder of 2025		2026		2027		2028		2029		2030		After 2030		Total
$	100	$	—	$	1,980	$	—	$	1,500	$	—	$	4,400	$	7,980

Financial Instruments Not Measured at Fair Value

The fair values of cash equivalents, accounts receivable, and accounts payable approximated carrying values because of the short-term nature of these instruments. At March 31, 2025, the estimated fair value of the Company’s long-term debt obligations, comprised of both Senior Notes and Term Loan Credit Facilities with current portions excluded, was $7.9 billion compared to a carrying value of $7.8 billion. At December 31, 2024, the estimated fair value of the Company’s long-term debt obligations, comprised of both Senior Notes and Term Loan Credit Facilities with current portions excluded, was $7.8 billion compared to a carrying value of $7.8 billion. The fair value was estimated using quoted market prices for the publicly registered Senior Notes, which are classified as Level 2 within the fair value hierarchy. The fair values and principal values consider the terms of the related debt and exclude the impacts of debt discounts. Because there is no active market for trading outstanding term loans, the fair values of the Term Loan Credit Facilities are estimated to be equal to their respective carrying values.

NOTE 10. Pension and Postretirement Benefit Plans

Transfer of Solventum Sponsored Pension and Postretirement Benefit Plans

Historically, certain employees of Solventum participated in U.S. and non-U.S. retirement plans sponsored by 3M. The primary U.S. defined-benefit pension plan was closed to new participants effective January 1, 2009. In December 2023, 3M committed to the future freeze of U.S. defined benefit pension benefits for non-union U.S. employees, effective December 31, 2028. During March 2024, in advance of the Spin-Off, all U.S. and most remaining 3M sponsored non-U.S. pension and postretirement plan obligations and assets with respect to current and former employees of Solventum were legally transferred to Solventum from 3M, except for certain assets held back within the 3M sponsored pension plans for regulatory purposes. Assets not yet delivered from 3M sponsored pension plans are already recognized within the Company's pension assets.

As these plans are sponsored by Solventum, they are accounted for as single employer plans. Therefore, the funded status is reflected in the condensed consolidated balance sheets, and the net periodic benefit costs are included in the condensed consolidated statements of income.

The Company has made deposits for its defined benefit plans with independent trustees. In certain non-U.S. jurisdictions, trust funds and deposits with insurance companies are maintained to provide pension benefits to plan participants and their

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beneficiaries. There are no plan assets in the U.S. non-qualified plan due to its nature. For the U.S. postretirement health care benefit plan, the Company has set aside amounts at least equal to annual benefit payments with an independent trustee.

Components of net periodic cost and other amounts recognized in other comprehensive (income) loss

The service cost component of defined benefit net periodic benefit cost is recorded in cost of product; cost of software and rentals; selling, general and administrative; and research and development. Components of net periodic benefit cost and other supplemental information for the three months ended March 31, 2025 and 2024 are as follows:

Three months ended March 31,


	Qualified and Non-qualified Pension Benefits
	United States				International				Postretirement Benefits
(Millions)	2025		2024		2025		2024		2025		2024
Net periodic benefit cost (benefit)
Operating expense
Service cost	$	6	$	—	$	5	$	4	$	1	$	—
Non-operating expense
Interest cost	24		—		5		5		3		—
Expected return on plan assets	(31)		—		(6)		(5)		(2)		—
Amortization of transition asset	—		—		—		—		—		—
Amortization of prior service benefit	—		—		—		—		—		—
Amortization of net actuarial loss	16		—		—		—		1		—
Settlements	—		—		—		—		—		—
Other	—		—		—		—		—		—
Total non-operating expense (benefit)	9		—		(1)		—		2		—
Total net periodic benefit cost (benefit)	$	15	$	—	$	4	$	4	$	3	$	—
Other changes in plan assets and benefit obligations recognized in other comprehensive (income) loss
Amortization of transition asset	$	—	$	—	$	—	$	—	$	—	$	—
Prior service cost (benefit)	—		—		—		—		—		—
Amortization of prior service benefit	—		—		—		—		—		—
Net actuarial (gain) loss	—		—		—		—		—		—
Amortization of net actuarial loss	(16)		—		—		—		(1)		—
Settlements	—		—		—		—		—		—
Foreign currency	—		—		—		—		—		—
Total recognized in other comprehensive (income) loss	(16)		—		—		—		(1)		—
Total recognized in net periodic benefit cost (benefit) and other comprehensive (income) loss	$	(1)	$	—	$	4	$	4	$	2	$	—

During the three months ended March 31, 2025, the Company made cash contributions totaling $2 million to its U.S. pension plans and $4 million to its international pension plans. In 2025, the Company expects to make total cash contributions of approximately $21 million to these plans. The Company funds annually, at a minimum, the statutorily required minimum amount for our qualified plans. Non-qualified plans are unfunded and we pay benefits from our cash on hand. Future contributions will depend on market conditions, interest rates and other factors.

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NOTE 11. Derivatives

Prior to April 1, 2024, Solventum indirectly participated in 3M’s centrally managed hedging program, which utilizes a number of tools to manage currency risk including natural hedges such as pricing, productivity, hard currency, hard currency-indexed billings, and localizing source of supply. 3M also used financial hedges to mitigate currency risk. After Spin-Off, the Company established its own hedging program.

Cash Flow Hedges - For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the derivative is reported as a component of other comprehensive income (loss) and reclassified into earnings in the same period during which the hedged transaction affects earnings. Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized in current earnings.

Cash Flow Hedging - Foreign Currency Forward Contracts: The Company enters into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies. These transactions are designated as cash flow hedges. The settlement or extension of these derivatives will result in reclassifications (from accumulated other comprehensive income) to earnings in the period during which the hedged transactions affect earnings. Solventum may de-designate these cash flow hedge relationships in advance of the occurrence of the forecasted transaction. The portion of gains or losses on the derivative instrument previously included in accumulated other comprehensive income (loss) for de-designated hedges remains in accumulated other comprehensive income (loss) until the forecasted transaction occurs or becomes probable of not occurring. Changes in the value of derivative instruments after de-designation are recorded in earnings. The maximum length of time over which Solventum hedges its exposure to the variability in future cash flows of the forecasted transactions is 36 months.

As of March 31, 2025, the Company had a balance of $9 million associated with the after-tax net unrealized gain associated with cash flow hedging instruments recorded in accumulated other comprehensive income. Of the total after-tax net unrealized balance as of March 31, 2025, Solventum expects to reclassify to earnings approximately $7 million after-tax net unrealized gain over the next 12 months based on exchange rates as of March 31, 2025.

The amount of pretax gain (loss) recognized in other comprehensive income (loss) related to derivative instruments designated as cash flow hedges is provided in the following table.


	Pretax Gain (Loss) Recognized in Other Comprehensive Income (Loss) on Derivative

	Three months ended March 31,
(Millions)	2025		2024
Foreign currency forward contracts	$	(14)	$	—

Net Investment Hedges - The Company enters into cross-currency swaps to hedge portions of the Company's investment in foreign subsidiaries and manage foreign exchange risk. For instruments that are designated and qualify as hedges of net investments in foreign operations and that meet the effectiveness requirements, the net gains and losses attributable to changes in spot exchange rates are recorded in cumulative translation within other comprehensive income. The remainder of the change in value of such instruments is recorded in earnings. Recognition in earnings of amounts previously recorded in cumulative translation is limited to circumstances such as complete or substantially complete liquidation of the net investment in the foreign operation.

Solventum's use of cross-currency swaps designated as hedges of the Company's net investment in foreign subsidiaries can vary by time period in connection with the extent of the Company's desired foreign exchange risk coverage.

In March 2025, the Company entered into additional cross-currency swaps designated as net investment hedges of approximately $377 million.

Derivatives Not Designated as Hedging Instruments - Derivatives not designated as hedging instruments include foreign currency contracts to offset, in part, the impacts of changes in value of various non-functional currency denominated items including certain intercompany financing balances. These derivative instruments are not designated in a hedging relationship; therefore, fair value gains and losses on these contracts are recorded in earnings. The Company does not hold or issue derivative financial instruments for trading purposes.

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Statement of Income Location and Impact of Derivative Instruments

The impact to income related to both derivative instruments designated in cash flow hedging relationships and those not designated as hedging instruments for the three months ended March 31, 2025 was not material. The impact from derivative instruments designated in cash flow hedging relationships was reflected within cost of sales and the impact from derivatives not designated as hedging instruments was reflected within other expense (income), net on the condensed consolidated statements of income.

The amount of gain (loss) excluded from effectiveness testing recognized in income relative to instruments designated in net investment hedge relationships is not material.

Location, Fair Value, and Gross Notional Amounts of Derivative Instruments

The following tables summarize the fair value of Solventum’s derivative instruments and their location in the condensed consolidated balance sheets. Notional amounts below are presented at period end foreign exchange rates.


	Gross Notional Amount				Assets					Liabilities
(Millions)					Location	Fair Value Amount				Location	Fair Value Amount
	March 31,		December 31,			March 31,		December 31,			March 31,		December 31,
	2025		2024			2025		2024			2025		2024
Derivatives designated as hedging instruments
Foreign currency forward contracts	$	377	$	355	Other current assets	$	7	$	17	Other current liabilities	$	—	$	—
Foreign currency forward contracts	159		157		Other assets	2		6		Other liabilities	1		—
Cross-currency swaps	756		380		Other assets	1		$	10	Other liabilities	2		—
Total derivatives designated as hedging instruments	$	1,292	$	892		$	10	$	33		$	3	$	—

Derivatives not designated as hedging instruments
Foreign currency forward contracts	$	614	$	397	Other current assets	$	1	$	—	Other current liabilities	$	2	$	—

Fair Value Disclosure: The Company’s derivative assets and liabilities within the scope of ASC 815, Derivatives and Hedging, are required to be recorded at fair value. The Company’s derivatives that are recorded at fair value include foreign currency forward contracts and cross-currency swaps. Solventum has determined that these derivatives are considered Level 2 fair value measurements. Solventum determines fair value using observable inputs including foreign currency exchange rates.

Credit Risk and Offsetting of Assets and Liabilities of Derivative Instruments: The Company is exposed to credit loss in the event of nonperformance by counterparties in forward contracts. However, the Company’s risk is limited to the fair value of the instruments. The Company actively monitors its exposure to credit risk through the use of credit approvals and credit limits, and by selecting major international banks and financial institutions as counterparties. Solventum enters into master netting arrangements with counterparties, which may allow each counterparty to net settle amounts owed between a Solventum entity and the counterparty as a result of multiple, separate derivative transactions. The Company does not anticipate nonperformance by any of these counterparties.

Solventum has elected to present the fair value of derivative assets and liabilities within the Company’s condensed consolidated balance sheets on a gross basis even when derivative transactions are subject to master netting arrangements and may otherwise qualify for net presentation. Solventum determined that the impact of the amount of eligible offsetting derivative assets and liabilities was not material if it had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria in the event of default or termination as stipulated by the terms of netting arrangements with each of the counterparties. For each counterparty, if netted, the Company would offset the asset and liability balances of all derivatives at the end of the reporting period based on the Solventum entity that is a party to the transactions. Derivatives not subject to master netting agreements are not eligible for net presentation. For the periods presented, Solventum has not received cash collateral from derivative counterparties.

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NOTE 12. Commitments and Contingencies

Legal Proceedings

Solventum is involved in numerous claims and lawsuits, principally in the United States, and regulatory proceedings worldwide. These claims, lawsuits and proceedings relate to matters including, but not limited to, product liability (involving products that the Company now or formerly manufactured and sold, including products made by the Health Care Business Group at 3M), intellectual property, commercial, antitrust, federal healthcare program related laws and regulations, such as the False Claims Act and anti-kickback laws in the United States and other jurisdictions. Unless otherwise stated, Solventum is vigorously defending all such litigation and proceedings. From time to time, Solventum also receives subpoenas, investigative demands or requests for information from various government agencies in the United States and foreign countries. Solventum generally responds in a cooperative, thorough and timely manner. These responses sometimes require time and effort and can result in considerable costs being incurred by the Company. Such requests can also lead to the assertion of claims or the commencement of administrative, civil, or criminal legal proceedings against Solventum and others, as well as to settlements. The outcomes of legal proceedings and regulatory matters are often difficult to predict. Any determination that the Company’s operations or activities are not, or were not, in compliance with applicable laws or regulations could result in the imposition of fines, civil or criminal penalties, and equitable remedies, including disgorgement, suspension or debarment or injunctive relief.

Process for Disclosure and Recording of Liabilities Related to Legal Proceedings

Many lawsuits and claims involve highly complex issues relating to causation, scientific evidence, and alleged actual damages, all of which are otherwise subject to substantial uncertainties. Assessments of lawsuits and claims can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. The categories of legal proceedings in which the Company is involved may include multiple lawsuits and claims, may be spread across multiple jurisdictions and courts that may handle the lawsuits and claims differently, may involve numerous and different types of plaintiffs, raising claims and legal theories based on specific allegations that may not apply to other matters, and may seek substantial compensatory and, in some cases, punitive, damages. These and other factors contribute to the complexity of these lawsuits and claims and make it difficult for the Company to predict outcomes and make reasonable estimates of any resulting losses. The Company's ability to predict outcomes and make reasonable estimates of potential losses is further influenced by the fact that a resolution of one or more matters within a category of legal proceedings may impact the resolution of other matters in that category in terms of timing, amount of liability, or both.

When making determinations about recording liabilities related to legal proceedings, the Company complies with the requirements of ASC 450, Contingencies, and related guidance, and records liabilities in those instances where it can reasonably estimate the amount of the loss and when the loss is probable. Where the reasonable estimate of the probable loss is a range, the Company records as an accrual in its financial statements the most likely estimate of the loss, or the low end of the range if there is no one best estimate. The Company either discloses the amount of a possible loss or range of loss in excess of established accruals if estimable, or states that such an estimate cannot be made. The Company discloses significant legal proceedings even where liability is not probable or the amount of the liability is not estimable, or both, if the Company believes there is at least a reasonable possibility that a loss may be incurred. Based on experience and developments, the Company reexamines its estimates of probable liabilities and associated expenses and receivables each period, and whether a loss previously determined to not be reasonably estimable and/or not probable is now able to be reasonably estimated or has become probable. Where appropriate, the Company makes additions to or adjustments of its reasonably estimated losses and/or accruals. As a result, the current accruals and/or estimates of loss and the estimates of the potential impact on the Company’s consolidated financial position, results of operations and cash flows for the legal proceedings and claims pending against the Company will likely change over time. During the first quarter of 2025 and 2024, the Company recognized $12 million and no legal charges, respectively. During the first quarter of 2025 the Company made a payment of $3 million related to a legal settlement. At March 31, 2025 and December 31, 2024, accrued litigation costs were $35 million and $25 million, respectively.

Because litigation is subject to inherent uncertainties, and unfavorable rulings or developments could occur, the Company may ultimately incur charges substantially in excess of presently recorded liabilities, including with respect to matters for which no accruals are currently recorded because losses are not currently probable and reasonably estimable. Many of the matters described herein are at varying stages, seek an indeterminate amount of damages or seek damages in amounts that the Company believes are not indicative of the ultimate losses that may be incurred. It is not uncommon for claims to be resolved over many years. As a matter progresses, the Company may receive information, through plaintiff demands, through discovery, in the form of reports of purported experts, or in the context of settlement or mediation discussions that purport to quantify an amount of alleged damages, but with which the Company may not agree. Such information may or may not lead the Company to determine that it is able to make a reasonable estimate as to a probable loss or range of loss in connection with a matter. However, even when a loss or range of loss is not probable and reasonably estimable, developments in, or the ultimate resolution of, a matter could be material to the Company and could have a material adverse effect on the Company, its consolidated financial position, results of operations and cash flows. In addition, future adverse rulings or developments, or

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settlements in, one or more matters could result in future changes to determinations of probable and reasonably estimable losses in other matters.

Process for Disclosure and Recording of Insurance Receivables Related to Legal Proceedings

The Company estimates insurance receivables based on an analysis of the terms of its numerous policies, including their exclusions, pertinent case law interpreting comparable policies, its experience with similar claims, and assessment of the nature of the claim and remaining coverage, and records an amount it has concluded is recognizable and expects to receive in light of the loss recovery and/or gain contingency models under ASC 450, ASC 610-30, and related guidance. For those insured legal proceedings for which the Company has recorded an accrued liability in its financial statements, the Company also records receivables for the amount of insurance that it concludes as recognizable from the Company’s insurance program. For those insured matters for which the Company has not recorded an accrued liability because the liability is not probable or the amount of the liability is not estimable, or both, but for which the Company has incurred an expense in defending itself, the Company records receivables for the amount of insurance that it concludes as recognizable for the expense incurred.

Product Liability Litigation

The following sections first describe the significant legal proceedings in which the Company is involved, and then describe the liabilities, if any, the Company has accrued relating to its significant legal proceedings.

3M is a named defendant in over 8,100 lawsuits in the United States and one Canadian putative class action with a single named plaintiff, alleging that they underwent various joint arthroplasty, cardiovascular, and other surgeries and later developed surgical site infections due to the use of the Bair Hugger patient warming system. Under the terms of the Separation and Distribution Agreement by and between Solventum and 3M (the “Separation and Distribution Agreement”), Solventum has agreed to indemnify 3M for uninsured liabilities related to the Bair Hugger patient warming system, to manage the litigation, and pay for legal expenses.

The plaintiffs seek damages and other relief based on theories of strict liability, negligence, breach of express and implied warranties, failure to warn, design and manufacturing defect, fraudulent and/or negligent misrepresentation/concealment, unjust enrichment, and violations of various state consumer fraud, deceptive or unlawful trade practices and/or false advertising acts.

The U.S. Judicial Panel on Multidistrict Litigation (“JPML”) has consolidated all cases pending in federal courts to the U.S. District Court for the District of Minnesota to be managed in a multi-district litigation (“MDL”) proceeding. In July 2019, the court excluded several of the plaintiffs’ causation experts, and granted summary judgment for 3M in all cases pending at that time in the MDL; however, those decisions were subsequently reversed by the U.S. Court of Appeals for the Eighth Circuit. The parties are actively litigating several MDL bellwether and state court cases, with trials anticipated in 2025 and 2026.

In addition to the federal MDL cases, there are seven state court personal injury cases relating to the Bair Hugger patient warming systems. Additionally, a putative class action has been filed in Ramsey County, Minnesota, seeking economic damages for the use of the Bair Hugger system in knee and hip replacement surgeries involving medically obese people in Minnesota from May 2017 to the present.

3M had been named a defendant in 61 cases in Minnesota state court. In January 2018, the Minnesota state court excluded plaintiffs’ experts and granted 3M’s motion for summary judgment on general causation. The Minnesota Court of Appeals affirmed the state court orders in their entirety and the Minnesota Supreme Court denied plaintiffs’ petition for review and entered the final dismissal in 2019, effectively ending the Minnesota state court cases.

In June 2016, 3M was served with a putative class action filed in the Ontario Superior Court of Justice for all Canadian residents who underwent various joint arthroplasty, cardiovascular, and other surgeries and later developed surgical site infections that the representative plaintiff claims were due to the use of the Bair Hugger patient warming system. The representative plaintiff seeks relief (including punitive damages) under Canadian law based on theories similar to those asserted in the MDL.

For product liability litigation matters described in this section for which a liability has been recorded, the amount recorded is included in the disclosed amounts in the preceding “Process for Disclosure and Recording of Liabilities Related to Legal Proceedings” section and is not material to the Company’s results of operations or financial condition. In addition, the Company is not able to estimate a possible loss or range of possible loss in excess of the recorded liability at this time.

Federal False Claims Act/Qui Tam Litigation

In October 2019, 3M acquired Acelity, Inc. and its KCI subsidiaries, including Kinetic Concepts, Inc. and KCI USA, Inc. As previously disclosed in the SEC filings by the KCI entities, in 2009, Kinetic Concepts, Inc. received a subpoena from the U.S.

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Department of Health and Human Services Office of Inspector General. In 2011, following the completion of the government’s review and its decision declining to intervene in two qui tam actions described further below, the qui tam relator-plaintiffs’ pleadings were unsealed.

The government inquiry followed two qui tam actions filed in 2008 by two former employees against Kinetic Concepts, Inc. and KCI USA, Inc. (collectively, the “KCI Defendants”) under seal in the U.S. District Court for the Central District of California. One qui tam action (the Godecke case) was dismissed in January 2022. In the remaining action (the Hartpence case), the complaint contains allegations that the KCI Defendants violated the federal False Claims Act by submitting false or fraudulent claims to federal healthcare programs by billing for 3M V.A.C. Therapy in a manner that was not consistent with the Local Coverage Determinations issued by the Durable Medical Equipment Medicare Administrative Contractors and seeks monetary damages.

In June 2019, the district court entered summary judgment in the KCI Defendants’ favor on all of the relator-plaintiff’s claims. The relator-plaintiff then filed an appeal in the U.S. Court of Appeals for the Ninth Circuit. Oral argument in the Hartpence case was held in July 2020. The appellate court issued an opinion in August 2022 reversing the decision of the district court and remanding the case for further proceedings. The district court held a status conference in January 2023 during which no case deadlines were set; the litigation remains in a pre-trial stage. The KCI Defendants filed a renewed motion for summary judgment in March 2023. In July 2023, the parties filed a joint status report notifying the court of the parties’ agreement to mediate the matter in November 2023.

As a result of a mediation held in November 2023, the relator-plaintiff and KCI reached an agreement in principle to settle the case and resolve all the remaining claims in this action, including the dismissal of the relator-plaintiff’s complaint with prejudice, subject to the agreement of the government and the parties’ negotiation and agreement of all remaining terms of the settlement. The KCI Defendants and relator-plaintiff have jointly requested that the court continue to hold in abeyance any hearing on the KCI Defendants’ pending Renewed Motion for Summary Judgment and any further proceedings in this case, to allow the parties to confer with counsel for the government and negotiate the remaining terms of the settlement agreement. The KCI Defendants and the relator-plaintiff submitted an updated status report to the court during January 2024 and updated status reports to the court periodically thereafter, most recently in March 2025. Under the terms of the Separation and Distribution Agreement, Solventum has agreed to indemnify 3M for liabilities related to this matter, to manage the litigation, and pay for related legal expenses.

For the matters described in this section for which a liability has been recorded, the amount recorded is included in the disclosed amounts in the preceding “Process for Disclosure and Recording of Liabilities Related to Legal Proceedings” section and is not material to the Company’s consolidated results of operations or financial condition. The Company is not able to estimate a possible loss or range of possible loss in excess of the recorded liability at this time.

Warranties/Guarantees

The Company had approximately $51 million and $40 million in bank guarantees, surety bonds, and other similar instruments issued and outstanding at March 31, 2025 and December 31, 2024, respectively. These instruments are utilized in connection with normal business activities. Furthermore, the Company does not disclose information on its product warranties, as management considers the balance immaterial to its consolidated results of operations and financial condition.

NOTE 13. Restructuring

In the fourth quarter of 2024, the Company announced its Solventum Way restructuring program, which is a reorganization designed to establish a more flexible and decentralized structure, create headroom to invest for growth and an operating model that enhances margins over time. Solventum expects to commit to further actions under this program and also expects that substantially all actions will be complete by the end of 2025.

The related restructuring charges for periods presented were recorded in the condensed consolidated statement of income as follows:


	Three months ended March 31,
(Millions)	2025
Cost of product	$	10
Cost of software and rentals	—
Selling, general and administrative expenses	5
Research and development expenses	3
Total operating income impact	$	18

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Restructuring actions, including cash and non-cash impacts, are as follows:


(Millions)	Employee Termination Benefits		Asset-Related and Other		Total
Expense incurred in 2024	$	46	$	16	$	62
Non-cash changes	—		(8)		(8)

Cash payments	(1)		—		(1)
Accrued liabilities as of December 31, 2024	$	45	$	8	$	53
Expense incurred in 2025	$	14	$	4	$	18
Non-cash changes	—		(4)		(4)

Cash payments	(38)		—		(38)
Accrued liabilities as of March 31, 2025	$	21	$	8	$	29

Asset-related and other primarily includes charges associated with asset write-offs and other contractual third party termination costs. All program charges were recognized within Corporate and are not included within business segment results.

NOTE 14. Earnings Per Share

Prior to the completion of the Spin-Off, the Company had no common shares issued and outstanding. On April 1, 2024, there were 172,709,505 shares of Solventum common stock issued and outstanding as part of the Distribution. This share amount is utilized for the calculation of basic and diluted earnings per share ("EPS") for all periods presented prior to the Spin-Off. For the three months ended March 31, 2024, these shares are treated as issued and outstanding for purposes of calculating historical earnings per share.

Subsequent to Spin-Off, the dilutive effect of outstanding stock options, restricted stock units ("RSUs") and performance share units ("PSUs") is reflected in the calculation of EPS using the treasury stock method. As of March 31, 2025, diluted EPS excludes 4.1 million shares issuable under stock-based compensation plans because the effect would have been antidilutive. For periods prior to the Spin-Off, there were no dilutive equity instruments as there were no equity awards of Solventum outstanding prior to the Spin-Off.

The computations for basic and diluted EPS are as follows:



	Three months ended March 31,
(Amounts in millions, except per share amounts)	2025		2024
Numerator:
Net income	$	137	$	237

Denominator:
Weighted average common shares outstanding – basic	173.7		172.7
Dilution associated with stock-based compensation plans	1.1		—
Weighted average common shares outstanding – diluted	174.8		172.7

Basic earnings per share	$	0.79	$	1.37
Diluted earnings per share	$	0.78	$	1.37

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NOTE 15. Stock-Based Compensation

Solventum grants annual stock-based compensation awards to certain employees and non-employee directors. In 2025, the Company's annual grant occurred in the first quarter and included: 1.2 million RSUs that vest over 3 years with a weighted average grant date fair value of $75.74 and 0.4 million PSUs that vest based on a combination of service, performance and market conditions, with a weighted average grant date fair value of $83.15. The actual number of PSUs that vest could range from 0% to 200% of the target number of shares granted, and will be determined based on the Company's performance against financial targets and total shareholder return relative to a selected industry peer group; performance is measured over a three-year period ending December 31, 2027.

The annual grant contains a retirement provision whereby employees who have reached age 55 and completed ten years of service with the Company will continue to vest in their award after they retire. For these awards, expense is recognized over the required service period. The compensation cost of awards to grant recipients who meet these conditions on the grant date is recognized on the grant date.

Stock-Based Compensation Expense

Amounts recognized in the condensed consolidated financial statements related to stock-based compensation awards, including stock options, RSUs, and PSUs, are provided in the following table. Total stock-based compensation expense recognized in cost of product and cost of software and rentals has been combined in the table below as cost of sales. Capitalized stock-based compensation amounts were not material.



	Three months ended March 31,
(Millions)	2025		2024
Cost of sales	$	5	$	1
Selling, general and administrative expenses	36		3
Research and development expenses	8		—
Stock-based compensation expenses	49		4
Income tax benefits (expense)	(5)		2
Stock-based compensation expenses, net of tax	$	44	$	6

NOTE 16. Related Parties

Related Party Transactions Prior to Spin-Off

Prior to the Spin-Off, the Company participated in centralized 3M treasury programs. This arrangement was not reflective of the manner in which the Company would have financed its operations had it been a standalone business separate from 3M during the periods presented prior to April 1, 2024. All adjustments relating to certain transactions among the Company and 3M, which include the transfer of the balance of cash to and from 3M, transfer of the balance of cash held in centralized cash management arrangements to and from 3M, and pushdown of all costs of doing business that were paid on behalf of the Company by 3M, are excluded from the asset and liability balances in the condensed consolidated balance sheets and have instead been reported within Net parent investment as a component of equity.

Corporate Allocations

The condensed consolidated statements of income for periods prior to April 1, 2024 include general corporate expenses of 3M for services provided by 3M for certain corporate and shared service functions that were provided on a centralized basis, including the use of shared assets. Expenses had been included on a direct usage basis where costs were specifically identifiable to Solventum or allocated based on the Company’s pro rata proportion of 3M's revenue.

Management believes that the expense allocations were determined on a basis that was a reasonable reflection of the utilization of services provided for or the benefit received by the Company during each of the periods presented prior to April 1, 2024. The amounts that would have been incurred on a standalone basis could materially differ from the amounts allocated. Management does not believe, however, that it is practicable to estimate what these expenses would have been had the Company operated as an independent entity, including any expenses associated with obtaining any of these services from unaffiliated entities. There was no expense allocation activity from 3M after April 1, 2024.

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3M expense allocations were recorded in the condensed consolidated statements of income within the following captions:


	Three months ended March 31,
(Millions)		2024
Cost of product		$	15
Cost of software and rentals		—
Selling, general and administrative expenses		177
Research and development expenses		28
Total		$	220

Related Party Transactions After Spin-Off

Separation and Distribution Agreement and Other Related Party Transactions with 3M

In connection with the Spin-Off on April 1, 2024, the Company entered into or adopted several agreements that provide a framework for Solventum's relationship with 3M after the separation and distribution. Below is a summary of activity between Solventum and 3M for the periods presented:

•Separation related adjustments, which are the net impact of certain assets and liabilities that were retained by 3M and those that were transferred to Solventum as of March 31, 2024, resulted in a decrease to net assets and total equity of $1.1 billion in the second quarter of 2024. This activity was reflected in the “Net transfers to 3M” line item of the condensed consolidated statements of changes in equity. The impact on net assets primarily represents liabilities payable to 3M for services received prior to Spin-Off as well as cash and accounts receivable retained by 3M.

•Transition agreement expenses for the three months ended March 31, 2025 were $137 million and are related to services received under transition agreements between the Company and 3M and its affiliates. These expenses are reflected in cost of product and operating expense (which is comprised of selling, general and administrative and research and development expenses) on the Company's condensed consolidated statements of income.

•Master supply agreement activity for three months ended March 31, 2025 comprised of revenue and cost of sales associated with products sold to 3M of $20 million and $15 million, respectively. Cost of product related to purchases from 3M under the master supply agreements was $63 million for the three months ended March 31, 2025.

Related Party Transactions

The Company had the following transactions with 3M and its affiliates, primarily in connection with the transition and master supply agreements, reported in the Company’s condensed consolidated financial statements:



	Three months ended March 31,
(Amounts in millions)	2025		2024
Net sales of product	$	20	$	—
Cost of product	155		—
Selling, general and administrative expenses	67		—
Research and development expenses	3		—

Current amounts due from and due to 3M under various agreements described above are recognized within the “Due from related parties” and “Due to related parties,” as applicable, in the condensed consolidated financial statements. Non-current amounts due to 3M were approximately $66 million at March 31, 2025 and were recognized in “Other liabilities” in the condensed consolidated balance sheets.

Net Parent Investment

Net transfers to 3M are included within Net parent investment in the condensed consolidated statements of changes in equity and within financing activities in the condensed consolidated statements of cash flows and represent the net effect of transactions between the Company and 3M.

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The reconciliation of net transfers to 3M between the condensed consolidated changes in equity and the condensed consolidated statements of cash flows are as follows:


	Three months ended March 31,
(Millions)	2025		2024
Net transfers to 3M on the condensed consolidated changes in equity	$	(31)	$	(7,431)
Stock compensation expense	—		(4)
Multiemployer pension expense	—		(5)
Net balances transferred from 3M	—		(411)
Net transfers to 3M on the condensed consolidated statements of cash flows	$	(31)	$	(7,851)

NOTE 17. Business Segments

Operating segments include components of an enterprise where separate financial information is available that is evaluated regularly by the Company’s Chief Operating Decision Maker (“CODM”) for the purpose of assessing performance and allocating resources. The Company’s CODM is its Chief Executive Officer. The primary profitability measurement used by the CODM to review segment operating results is segment operating income. The CODM uses segment operating income to allocate resources during the annual strategic planning process and then holds the segments accountable to the resourcing decisions during the annual budgeting process. The CODM does not use asset information by segment to evaluate operating segments as the CODM does not receive discrete asset information by segment. The Company’s operating activities are managed through four operating segments: MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration. There have been no changes to the composition of the segments or to financial information reported within each of the business segments. These segments have been identified based on the nature of the products sold and how the Company manages its operations. Transactions among reportable segments are recorded at cost. No operating segments have been aggregated to form reportable segments.

Corporate and Unallocated primarily includes amortization of acquired intangible assets, restructuring and related charges, benefits or costs related to capitalized manufacturing variances, and Spin-Off and separation related costs. Spin-Off and separation related costs include any costs incurred as part of our separation from 3M and costs to set up operations as a standalone company, including system implementations, manufacturing relocation, legal entity separation, certain equity awards granted as part of the Spin-Off, profit mark-ups on transition service arrangements with 3M and other one-time costs.

Corporate and Unallocated 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. Because Corporate and Unallocated includes a variety of miscellaneous items, it is subject to fluctuation on a quarterly and annual basis. Business segment operating income is reconciled to total operating income and pre-tax income below.

Consistent accounting policies have been applied on a consolidated basis as well as by all segments for all reporting periods.

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Business Segment Information and Disaggregated Net Sales


	Three months ended March 31,

Net Sales (Millions)	2025		2024
Advanced Wound Care	$	448	$	441
Infection Prevention and Surgical Solutions	710		678
MedSurg	1,157		1,119
Dental Solutions	328		335
Health Information Systems	329		317
Purification and Filtration	242		245
Corporate and Unallocated	13		—
Total Company	$	2,070	$	2,016

	Three months ended March 31,
Cost of Sales (Millions)	2025		2024
MedSurg	$	548	$	493
Dental Solutions	118		106
Health Information Systems	88		89
Purification and Filtration	134		136

	Three months ended March 31,
Operating Expenses (Millions)*	2025		2024
MedSurg	$	404	$	405
Dental Solutions	132		119
Health Information Systems	132		127
Purification and Filtration	73		70
* Operating expenses are comprised of selling, general and administrative expenses and research and development expenses as shown on the condensed consolidated statements of income.

	Three months ended March 31,
Operating Performance (Millions)	2025		2024
MedSurg	$	206	$	221
Dental Solutions	78		110
Health Information Systems	109		101
Purification and Filtration	35		39
Total business segment operating income	428		471
Corporate and Unallocated:
Amortization expense	(81)		(87)
Other corporate and unallocated	(195)		(3)
Total Corporate and Unallocated	(276)		(90)
Total Company operating income	152		381

Interest expense, net	104		39

Other expense/(income), net	11		13
Income before income taxes	$	38	$	329

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the Company’s condensed consolidated financial statements and corresponding notes elsewhere in this Quarterly Report on Form 10-Q. The following discussion and analysis provides information management believes to be relevant to understanding the financial condition and results of operations of Solventum for the three months ended March 31, 2025 and 2024. For full understanding of the Company's financial condition and results of operations, the below discussion should be read alongside the Management's Discussion and Analysis of Financial Condition and Results of Operations included in the Company's 2024 Annual Report on Form 10-K. This discussion contains forward-looking statements that are based upon current expectations and are subject to uncertainty and changes in circumstances. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed below and elsewhere in this Quarterly Report on Form 10-Q, and particularly in Item 1A, “Risk Factors” in the Company's 2024 Annual Report on Form 10-K.

All amounts discussed are in millions of U.S. dollars, unless otherwise indicated. Amounts reported within this interim report are rounded to the nearest million and the sum of the components may not equal the total amount reported due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding.

Unless the context otherwise requires, references to “Solventum” and the “Company” refer to (i) 3M’s Health Care Business prior to the Spin-Off as a carve-out business of 3M and (ii) Solventum Corporation and its subsidiaries following the Spin-Off.

Transition to Standalone Company

Solventum utilized allocations and carve-out methodologies through the date of the Spin-Off to prepare combined financial statements. The condensed consolidated financial statements herein for periods prior to the Spin-Off may not be indicative of the Company’s future performance, do not necessarily include the actual expenses that would have been incurred, and may not reflect our results of operations, financial position, and cash flows had we been a separate, standalone company during the historical periods presented.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is designed to provide a reader of Solventum’s financial statements with a narrative from the perspective of management. Solventum’s MD&A is presented in the following sections:

•Overview

•Results of Operations

•Performance by Business Segment

•Financial Condition and Liquidity

Overview

Solventum is a leading global healthcare company developing, manufacturing, and commercializing a broad portfolio of solutions that leverages deep material science, data science, and digital capabilities to address critical customer and patient needs. We constantly seek to enable the improvement of standards of care and move healthcare forward with innovation powered by insights, clinical intelligence, technology, and manufacturing expertise. Our 70+ year history of discovering and innovating advanced solutions has helped us solve our customers’ toughest challenges and become a trusted partner.

Operating Segments and Sales Change Information

Solventum manages its operations in four business segments: MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration. On February 25, 2025, the Company entered into a definitive agreement to sell its Purification and Filtration business to Thermo Fisher Scientific Inc. for $4.1 billion. The closing of the transaction is expected to be completed by the end of the 2025 calendar year, subject to regulatory approvals and customary closing conditions.

References are made to organic sales change, which is defined as the change in net sales, absent the separate impacts on sales from foreign currency translation and acquisitions, net of divestitures, and to constant currency change, which is defined as the change in net sales absent the impact on sales from foreign currency translation. Other, as comprised in the tables below, includes acquisition and divestiture-related activities. Acquisitions include non-health care 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 dental anesthetics business that was sold in August 2023 as well as lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. Solventum believes this

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information is useful to investors and management in understanding ongoing operations and in analysis of ongoing operating trends.

Sales and operating income by business segment:

The following tables contain sales and operating results by business segment for all periods presented. The Company’s use of the term “NM” reflects results considered not material due to not having material activity in comparable prior years. Refer to the section entitled “—Performance by Business Segment” below for discussion of sales change and operating performance. Refer to Note 17 to the condensed consolidated financial statements for additional information on business segments.

Segment and Total Company Net Sales


	Three months ended March 31,				Increase/(Decrease)
(Millions)	2025		2024		Reported Growth		Currency Impact		Constant Currency		Other		Organic Growth
Segment Sales
Advanced Wound Care	$	448	$	441	1.5	%	(1.2)	%	2.7	%	(0.2)	%	2.8	%
Infection Prevention and Surgical Solutions	710		678		4.7		(2.0)		6.7		(1.5)		8.2
MedSurg	1,157		1,119		3.4		(1.6)		5.0		(1.0)		6.0
Dental Solutions	328		335		(2.1)		(1.9)		(0.2)		(0.6)		0.4
Health Information Systems	329		317		3.6		(0.3)		3.8		—		3.9
Purification and Filtration	242		245		(0.9)		(2.0)		1.1		(1.1)		2.2
Corporate and Unallocated	13		—		NM		NM		NM		NM		NM
Total Company	$	2,070	$	2,016	2.6	%	(1.6)	%	4.2	%	(0.1) %		4.3	%

Segment and Total Company Operating Income


	Three months ended March 31,
(Millions)	2025		2024		2025 vs 2024 change
Segment Operating Income
MedSurg	$	206	$	221	(6.6)	%
Dental Solutions	78		110		(28.6)
Health Information Systems	109		101		8.0
Purification and Filtration	35		39		(9.1)
Corporate and Unallocated	(276)		(90)		(206.7)
Total Company	$	152	$	381	(60.1)	%

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Net Sales by Geographic Area

While the Company manages its businesses globally and believes its business segment results are the most relevant measure of performance, the Company also utilizes geographic area data as a secondary performance measure. Sales are generally reported within the geographic area based on the location of the customer taking possession of the products or in which services are rendered.

Percent change information compares the three months ended March 31, 2025 with the same period for the prior year, unless otherwise indicated.


	Three months ended March 31, 2025
(Millions)	United States			International			Worldwide
Net sales	$	1,140		$	930		$	2,070
% of worldwide sales	55.1		%	44.9		%	100.0		%
Increase/(decrease)
Organic growth	4.0		%	4.6		%	4.3		%
Other	0.8			(1.1)			(0.1)
Constant currency	4.8			3.5			4.2
Currency impact	—			(3.4)			(1.6)
Reported growth	4.8		%	0.1		%	2.6		%

Additional information beyond what is included in the preceding table is as follows:

First quarter 2025 results

•In the United States geographic area, both total sales and organic sales increased. Organic growth occurred across all segments, led by MedSurg.

•In the International geographic area, total sales were flat while organic sales increased. Organic growth was led by MedSurg.

Managing currency risks

Prior to April 1, 2024, Solventum indirectly participated in 3M’s centrally managed hedging program, which utilizes a number of tools to manage currency risk including natural hedges such as pricing, productivity, hard currency, hard currency-indexed billings, and localizing source of supply. 3M also used financial hedges to mitigate currency risk. Starting in the second quarter of 2024, Solventum established its own hedging program. Refer to Note 11 to the condensed consolidated financial statements for additional details.

The stronger U.S. dollar had a negative worldwide impact on sales for the three months ended March 31, 2025 compared to 2024. Solventum estimates that year-on-year foreign currency transaction effects, including hedging impacts, decreased pre-tax income by approximately $2 million at March 31, 2025.

Financial condition

Refer to the section entitled “—Financial Condition and Liquidity” below for a discussion of items impacting cash flows.

Results of Operations

Net Sales

Refer to the preceding “—Overview” section and the “—Performance by Business Segment” section later in MD&A for discussion of sales change.

Operating Expenses


	Three months ended March 31,
(Percent of corresponding net sales)	2025		2024		Change
Cost of product	52.3	%	46.7	%	5.6	%
Cost of software and rentals	25.6		25.7		(0.1)

Cost of Product

Cost of product includes manufacturing, engineering and freight costs.

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Cost of product, measured as a percent of sales of product, increased in the first quarter of 2025 when compared to the first quarter of 2024. The increase was driven by increased costs due to the impact of higher costs on inventory sourced under the master supply and transition manufacturing agreements with 3M and due to the cost of other transition support provided by 3M.

Cost of Software and Rentals

Cost of software and rentals includes compensation-related costs associated with installation, training and maintenance for our software products, and depreciation, maintenance and refurbishment cost and freight costs related to our hardware rental units.

Cost of software and rentals, measured as a percent of sales of software and rentals, decreased slightly during the first quarter of 2025 as compared to the same period last year due to the impact of higher software revenue.


	Three months ended March 31,
(Percent of total net sales)	2025		2024		Change
Selling, general and administrative (SG&A)	37.1	%	29.6	%	7.5	%
Research and development (R&D)	9.3		9.7		(0.4)
Operating income	7.3		18.9		(11.6)

Selling, General and Administrative

SG&A, measured as a percent of total net sales, increased in the first quarter of 2025 when compared to the same period last year. The increase was driven by higher compensation, including equity-based awards, and higher costs associated with both initial stand-up and ongoing operations to support a standalone company.

Research and Development

R&D, measured as a percent of total net sales, decreased in the first quarter of 2025 when compared to the same period last year due to similar costs year-on-year in relation to higher net sales.

Interest Expense, Net and Other Expense (Income), Net


	Three months ended March 31,
(Millions)	2025		2024
Interest expense, net	$	104	$	39
Other expense (income), net	11		13

Interest expense, net includes interest accrued on debt obligations, offset by interest income from cash and marketable securities. Interest expense, net increased in the first quarter of 2025 as compared to the same period last year due to a full quarter of interest incurred related to the February 2024 issuance of senior notes and March 2024 draw on the senior term loan credit facilities. Refer to Note 9 to the financial statements for more information. This increase was partially offset by interest earned from cash and marketable securities held during the period.

Other expense (income), net includes the non-service component of periodic pension cost, investment gains and losses, and foreign currency transaction gain (loss). Other expense (income), net decreased slightly for the first quarter of 2025 as compared to the same period last year as lower currency-related impacts were offset by higher non-service pension costs from plans that transferred at the end of March 2024.

Provision for (benefit from) Income Taxes:


	Three months ended March 31,
(Percent of pre-tax income/loss)	2025		2024
Effective tax rate	(262.1)	%	28.0	%

Refer to Note 8 to the financial statements for further discussion of income taxes.

Performance by Business Segment

Note 17 to the condensed consolidated financial statements provides an overview of Solventum’s business segments in addition to disclosures relating to Solventum’s segments. We manage our operations in four business segments. Our reportable segments are MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration. Our Chief Operating Decision Maker evaluates segment operating performance using net sales and business segment operating income.

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Corporate and Unallocated

Certain items are maintained at the corporate level and not allocated to the segments ("Corporate and Unallocated"). Corporate and Unallocated includes amortization of acquired intangible assets, restructuring and related charges, and benefits or costs related to capitalized manufacturing variances. In addition, Corporate and Unallocated includes Spin-Off and separation related costs. Spin-Off and separation related costs include any costs incurred as part of our separation from 3M and costs to setup operations as a standalone company, including system implementations, manufacturing relocations, legal entity separations, certain equity awards granted as part of the Spin-Off, profit mark-ups on transition service arrangements with 3M and other one-time costs.

Corporate and Unallocated also includes sales and cost of sales related to our supply agreements with 3M and other supply agreements assumed by the Company at Spin-Off related to legacy 3M businesses. Because Corporate and Unallocated includes a variety of miscellaneous items, it is subject to fluctuation on a quarterly and annual basis.

Operating Business Segments

Information related to the Company’s segments is presented in the tables that follow with additional context in the corresponding narrative below the tables.

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MedSurg (55.9% of consolidated sales for the three months ended March 31, 2025 )


	Three months ended March 31,
(Millions)	2025			2024
Net sales	$	1,157		$	1,119
Increase/(decrease)
Organic growth	6.0		%	0.1		%
Other	(1.0)			—
Constant currency	5.0			0.1
Currency impact	(1.6)			(0.5)
Reported growth	3.4		%	(0.4)		%

Business segment operating income	$	206		$	221
Percent change	(6.6)		%	(12.6)		%
Percent of sales	17.8		%	19.7		%

First quarter 2025 results

Sales in MedSurg were up 3.4%:

•Organic growth was driven by strong broad-based volumes in Infection Prevention and Surgical Solutions, led by I.V. site management and hospital consumables.

•Advanced Wound Care volumes grew, driven by single-use negative pressure wound therapy consumables.

•Other includes lost sales from certain health care businesses in India retained by 3M in connection with the Spin-Off.

•Foreign currency translation negatively impacted sales by (1.6%).

Business segment operating income margin decreased when compared to the same period last year. The decrease was driven by higher costs to stand-up and operate our standalone structure after Spin-Off.

Dental Solutions (15.8% of consolidated sales for the three months ended March 31, 2025)


	Three months ended March 31,
(Millions)	2025			2024
Net sales	$	328		$	335
Increase/(decrease)
Organic growth	0.4		%	0.4		%
Other	(0.6)			(1.8)
Constant currency	(0.2)			(1.4)
Currency impact	(1.9)			(0.4)
Reported growth	(2.1)		%	(1.8)		%

Business segment operating income	$	78		$	110
Percent change	(28.6)		%	(0.9)		%
Percent of sales	23.9		%	32.8		%

First quarter 2025 results:

Sales in Dental Solutions were down (2.1)%:

•Organic growth in restorative and prevention solution products offset by declines in traditional orthodontic products.

•Other includes lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off.

•Foreign currency translation negatively impacted sales by (1.9%).

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Business segment operating income margin decreased when compared to the same period last year as a result of higher costs to stand-up and operate our standalone structure after Spin-Off and inventory-related charges that are not expected to continue in 2025.

Health Information Systems (15.9% of consolidated sales for the three months ended March 31, 2025)


	Three months ended March 31,
(Millions)	2025			2024
Net sales	$	329		$	317
Increase/(decrease)
Organic growth	3.9		%	0.3		%
Other	—			—
Constant currency	3.8			0.3
Currency impact	(0.3)			—
Reported growth	3.6		%	0.3		%

Business segment operating income	$	109		$	101
Percent change	8.0		%	7.4		%
Percent of sales	33.1		%	31.9		%

First quarter 2025 results:

Sales in Health Information Systems were up 3.6%:

•Organic growth was driven by continued adoption of our 3MTM 360 EncompassTM.

•Foreign currency translation negatively impacted sales by (0.3%).

Business segment operating income margin increased when compared to the same period last year driven by temporary savings from the Company's Solventum Way restructuring program, partially offset by higher compensation costs.

Purification and Filtration (11.7% of consolidated sales for the three months ended March 31, 2025)


	Three months ended March 31,
(Millions)	2025			2024
Net sales	$	242		$	245
Increase/(decrease)
Organic growth	2.2		%	6.7		%
Other	(1.1)			—
Constant currency	1.1			6.7
Currency impact	(2.0)			(0.6)
Reported growth	(0.9)		%	6.1		%

Business segment operating income	$	35		$	39
Percent change	(9.1)		%	8.3		%
Percent of sales	14.5		%	15.9		%

First quarter 2025 results:

Sales in Purification and Filtration were down (0.9)%:

•Organic growth was driven by continued strength in bioprocessing filtration and industrial filtration, which benefited from added production capacity, partially offset by declines in membrane OEM products.

•Other includes lost sales from certain health care businesses in India retained by 3M in connection with the Spin-Off.

•Foreign currency translation negatively impacted sales by (2.0)%.

Business segment operating income margin decreased due to a negative impact from higher compensation-related costs and costs to stand-up and operate our standalone structure after Spin-Off, partially offset by benefits from sales mix.

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Financial Condition and Liquidity

The strength and stability of Solventum’s operating model and strong free cash flow capability provides financial flexibility and enables the Company to invest through business cycles. Historically, Solventum generated positive operating cash flows and a majority of such cash flows were transferred to 3M as part of 3M’s cash pooling arrangements, the effect of which is presented as Net transfers to 3M in our consolidated financial statements.

Debt and Credit Facilities

Refer to Note 9 of the Company's condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for information on the Company's long-term debt and short-term borrowings.

Commercial Paper

Cash, cash equivalents and marketable securities

As of March 31, 2025, Solventum had $534 million of cash and cash equivalents, of which approximately $447 million was held by the Company’s foreign subsidiaries and approximately $92 million was held in the United States. $5 million of cash and cash equivalents held for sale are included in the geographic breakout. These balances are invested in bank instruments and other high-quality fixed income securities. As of December 31, 2024, Solventum had $762 million of cash and cash equivalents, of which approximately $611 million was held by the Company’s foreign subsidiaries and $151 million was held in the United States. There were immaterial amounts of marketable securities at both March 31, 2025 and December 31, 2024. The decrease from December 31, 2024 resulted from coupon payments on the Senior Notes, interest payments on the Facilities, and prepayment of the 18-month senior unsecured term loan credit facility.

Cash Flows

Cash flows from operating, investing and financing activities are provided in the tables that follow. Individual amounts in the condensed consolidated statements of cash flows exclude the effect of exchange rate impacts on cash and cash equivalents, which are presented separately in the cash flows. Thus, the amounts presented in the following operating, investing and financing activities tables reflect changes in balances from period to period adjusted for these effects.


	Three months ended March 31,

(Millions)	2025		2024
Cash provided by (used in):
Operating activities	$	29	$	442
Investing activities	(114)		(102)
Financing activities	(139)		462
Effect of exchange rate changes on cash and cash equivalents	1		—
Net increase (decrease) in cash and cash equivalents	$	(223)	$	802

Operating Activities

For the first quarter of 2025, cash flows provided by operating activities decreased compared to the first quarter of 2024 primarily due to lower net income. Cash flow activity with 3M is reflected in the due from and due to related parties. This activity includes settlement of payables and receivables transferred at Spin-Off related to operating transactions between 3M and Solventum entities that occurred prior to the Spin-Off and transactions under the transition agreements with 3M.

Investing Activities

Purchases of property, plant and equipment increased in the first quarter of 2025 as compared to the first quarter of 2024. The increase is primarily driven by additional separation related capital spending as the Company relocates manufacturing and source of supply from 3M. In addition, the Company is focused on investments to support growth, renewal and maintenance programs, and environmental health services.

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Financing Activities

For the first quarter of 2025, cash flows used by financing activities increased as compared to the first quarter of 2024, primarily due to the Company's repayment of $100 million outstanding principle issued under the senior term loan credit facilities.

Material Cash Requirements from Known Contractual and Other Obligations:

Solventum’s material cash requirements from known contractual and other obligations primarily relate to the following, for which information on both a short-term and long-term basis is provided in the indicated notes to the condensed consolidated financial statements:

•Tax obligations—Refer to Note 8 to the condensed consolidated financial statements.

•Debt—Refer to Note 9 to the condensed consolidated financial statements.

•Commitments and contingencies—Refer to Note 12 to the condensed consolidated financial statements.

Solventum purchases the majority of its materials and services as needed, with no unconditional commitments. In limited circumstances, in the normal course of business, the Company enters into unconditional purchase obligations with various vendors that may take the form of, for example, take or pay contracts in which the Company guarantees payment to ensure availability of certain materials or services or to ensure ongoing efforts on capital projects. The Company expects to receive underlying materials or services for these purchase obligations. To the extent the limited amount of these purchase obligations fluctuates, it largely trends with normal-course changes in regular operating activities. Additionally, contractual capital commitments represent a small part of the Company’s expected capital spending.

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Cautionary Note Concerning Forward Looking Statements

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2, and other materials Solventum has filed or will file with the SEC (and oral communications that Solventum may make) contain or incorporates by reference statements that relate to future events and expectations and, as such, 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.

All statements that reflect Solventum’s expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, forecasts relating to discussions of future operations and financial performance (including volume growth, pricing, sales and earnings per share growth and cash flows) and statements regarding Solventum’s strategy for growth, future product development, regulatory clearances and approvals, competitive position and expenditures. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict. Although Solventum believes that the expectations reflected in any forward-looking statements it makes are based on reasonable assumptions, it can give no assurance that these expectations will be attained and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. Such risks and uncertainties include, but are not limited to:

•the effects of, and changes in, worldwide economic, political, regulatory, international, trade and geopolitical conditions, natural disasters, war, public health crises, and other events beyond Solventum’s control;

•operational execution risks;

•damage to our reputation or our brands;

•risks from acquisitions, strategic alliances, divestitures and other strategic events, including the divestiture of our Purification and Filtration business;

•Solventum’s business dealings involving third-party partners in various markets;

•Solventum’s ability to access the capital and credit markets and changes in Solventum’s credit ratings;

•exposure to interest rate and currency risks;

•the highly competitive environment in which Solventum operates and consolidation in the healthcare industry;

•reduction in customers’ research budgets or government funding;

•the timing and market acceptance of Solventum’s new product and service offerings;

•ongoing working relationships with certain key healthcare professionals;

•changes in reimbursement practices of governments or private payers or other cost containment measures;

•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;

•legal and regulatory proceedings and legal compliance risks (including third-party risks) with regards to antitrust, Foreign Corrupt Practices Act (“FCPA”) 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;

•potential liabilities related to a broad group of perfluoroalkyl and polyfluoroalkyl substances, collectively known as “PFAS”;

•risks related to the highly regulated environment in which Solventum operates;

•risks associated with product liability claims;

•climate change and measures to address climate change;

•security breaches and other disruptions to information technology infrastructure;

•Solventum’s failure to obtain, maintain, protect, or effectively enforce its intellectual property (“IP”) rights;

•pension and postretirement obligation liabilities;

•any failure by 3M to perform any of its obligations under the various separation agreements in connection with the Spin-Off;

•any failure to realize the expected benefits of the Spin-Off, and/or that the Spin-Off will not be completed within the expected time frame, on the expected terms or at all;

•a determination by the IRS or other tax authorities that the Spin-Off or certain related transactions should be treated as taxable transactions;

•financing transactions undertaken in connection with the separation and risks associated with additional indebtedness;

•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 separation will exceed Solventum’s estimates; and

•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

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management’s attention and the impact on relationships with customers, suppliers, employees and other business counterparties.

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. Solventum assumes no obligation to update or revise such statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

Important information as to these factors can be found in this document, including, among others, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the headings of “Overview,” “Financial Condition and Liquidity” and annually in “Critical Accounting Estimates.” Discussion of these factors is incorporated by reference from Part I, Item 1A, “Risk Factors,” of this document, and should be considered an integral part of Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” For additional information concerning factors that may cause actual results to vary materially from those stated in the forward-looking statements, see our reports on Form 8-K filed with the SEC from time to time and the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC. Any forward-looking statement speaks only as of the date on which it is made, and Solventum assumes no obligation to update or revise such statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Foreign Currency Exchange Rate Risks:

Solventum faces transactional exchange rate risk from transactions with customers in countries outside the United States and from intercompany transactions between affiliated entities. Foreign currency exchange rates and fluctuations in those rates may cause fluctuations in cash flows related to foreign denominated transactions. The Company is also exposed to the translation of foreign currency earnings to the U.S. dollar.

Commodity Prices Risk:

Solventum manages commodity price risks through negotiated supply contracts and price protection agreements. The Company does not participate in material commodity hedging activity.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Processes

The Company carried out an evaluation, under the supervision and with the participation of its management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in the Exchange Act Rule 13a-15(e)) as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective.

Changes in Internal Controls Over Financial Reporting

There was no change in the Company’s internal control over financial reporting that occurred during the Company’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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SOLVENTUM CORPORATION

FORM 10-Q

For the Quarterly Period Ended March 31, 2025

PART II. Other Information

Item 1. Legal Proceedings

Discussion of legal matters is incorporated by reference from Part I, Item 1, Note 12, “Commitments and Contingencies,” of this document, and should be considered an integral part of Part II, Item 1, “Legal Proceedings.”

Item 1A. Risk Factors

There have been no material changes to the risk factors as disclosed in our 2024 Annual Report on Form 10-K.

Discussion of these factors is incorporated by reference into and considered an integral part of Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

There were no unregistered sales of equity securities during the period covered by this report.

Item 3. Defaults Upon Senior Securities

No matters require disclosure.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Insider Trading Arrangements and Policies

During the quarter ended March 31, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Availability of Information

Solventum's website address is www.solventum.com. Investors and others should note that the Company announces material information to its investors using SEC filings, press releases, its investor relations website, public conference calls and webcasts. The Company uses these channels to communicate with investors, customers and the public about the Company, its products and other issues. The information on, or that may be accessed through, Solventum's website is not incorporated by reference into this Quarterly Report on Form 10-Q and should not be considered a part of this Quarterly Report on Form 10-Q.

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Item 6. Exhibits



(2.1)			Transaction Agreement by and between Solventum Corporation and Thermo Fisher Scientific Inc. (incorporated by reference to Exhibit 2.1 from Solventum Corporation's Form 8-K, filed February 27, 2025)
(3.1)			Amended and Restated Certificate of Incorporation of Solventum Corporation (incorporated by reference to Exhibit 3.1 from Solventum Corporation's Form 8-K, filed April 4, 2024)
(3.2)			Amended and Restated Bylaws of Solventum Corporation (incorporated by reference to Exhi bit 3.1 from Solventum Corporation's Form 8-K, filed September 26, 2024)
(4.1)			Indenture, dated as of February 27, 2024, between Solventum Corporation and U.S. Bank Trust Company, N.A., as successor trustee, with respect to Solventum's senior notes, is incorporated by reference from Exhibit 4.1 to Amendment No.2 to the Company's Registration Statement on Form 10, filed March 11, 2024.
(4.2)			First Supplemental Indenture, dated as of February 27, 2024, to Indenture dated as of February 27, 2024, between Solventum Corporation and U.S. Bank Trust Company, N.A., as successor trustee, with respect to Solventum’s senior debt notes, is incorporated by reference from Exhibit 4.2 to Amendment No. 2 to the Company's Registration Statement on Form 10, filed March 11, 2024.















(10.15)			Solventum 2024 Long-Term Incentive Plan Performance Share Unit Awards Agreement (incorporated herewith )

Filed herewith, in addition to items, if any, specifically identified above:


(31.1)			Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
(31.2)			Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
(32.1)			Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
(32.2)			Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
(101.INS)			Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
(101.SCH)			Inline XBRL Taxonomy Extension Schema Document
(101.CAL)			Inline XBRL Taxonomy Extension Calculation Linkbase Document
(101.DEF)			Inline XBRL Taxonomy Extension Definition Linkbase Document
(101.LAB)			Inline XBRL Taxonomy Extension Label Linkbase Document
(101.PRE)			Inline XBRL Taxonomy Extension Presentation Linkbase Document
(104)			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SOLVENTUM CORPORATION

(Registrant)


Date: May 9, 2025
	By	/s/ Wayde McMillan
		Wayde McMillan,
	Executive Vice President and Chief Financial Officer (Mr. McMillan is a Principal Financial Officer and has been duly authorized to sign on behalf of the Registrant.)

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Date	Price Target	Rating	Analyst
12/4/2024	$70.00	Neutral	Mizuho
10/8/2024	$82.00	Buy	Stifel
10/7/2024	$71.00	Neutral	Piper Sandler
9/26/2024		Peer Perform	Wolfe Research
9/5/2024		Neutral	BTIG Research
6/24/2024		Hold	Argus
5/30/2024	$54.00	Sell	Goldman

SEC Form 10-Q filed by Solventum Corporation

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