Baxter 2023年第一季度报告FIRST-QUARTER 2023 EARNINGS

BaxterInternationalInc.

April27,2023

FIRST-QUARTER

2023EARNINGS

1

FORWARD-LOOKINGSTATEMENTS

Thispresentationincludesforward-lookingstatementsconcerningthecompany’sfinancialresults(includingtheoutlookforsecondquarterandfull-year2023)andbusinessdevelopmentandregulatoryactivities(includinganticipatedcostsavings).Theseforward-lookingstatementsarebasedonassumptionsaboutmanyimportantfactors,includingthefollowing,whichcouldcauseactualresultstodiffermateriallyfromthoseintheforward-lookingstatements:thecompany’sabilitytoexecuteandcompletestrategicinitiatives,assetdispositionsandothertransactions,includingtheproposedspinoffofthecompany’sRenalCareandAcuteTherapiesproductcategories;thecompany’splanstosimplifythecompany’soperatingmodelandmanufacturingfootprintandthecompany’sreviewofstrategicalternatives(includingapotentialsale)forthecompany’sBioPharmaSolutionsproductcategory,thetimingforsuchtransactions,theabilitytosatisfyanyapplicableconditionsandtheexpectedproceeds,considerationandbenefits;failuretoaccuratelyforecastorachievethecompany’sshort-andlong-termfinancialimprovementperformanceandgoals(includingwithrespecttothecompany’sstrategicactions);thecompany’sabilitytoexecuteonitscapitalallocationplans,includingthecompany’sdebtrepaymentplans,thetimingandamountofanydividends,sharerepurchasesandacquisitionproceedsandthecapitalstructureofthepubliccompanythatthecompanyexpectstoformasaresultoftheproposedspinoff(andtheresultingcapitalstructurefortheremainingcompany);theimpactofglobaleconomicconditions(including,amongotherthings,inflationlevels,interestrates,financialmarketvolatility,bankingcrises,thepotentialforarecession,theongoingwarinUkraine,therelatedeconomicsanctionsbeingimposedgloballyinresponsetotheconflictandpotentialtradewars)andcontinuingpublichealthcrises,pandemicsandepidemics,suchastheongoingCOVID-19pandemic,ortheanticipationofanyoftheforegoing,onthecompany’soperationsandonthecompany’semployees,customersandsuppliers,includingforeigngovernmentsincountriesinwhichthecompanyoperates;downgradestothecompany’screditratingsorratingsoutlooks,andtherelatedimpactonthecompany’sfundingcostsandliquidity;demandforandmarketacceptancerisksforandcompetitivepressuresrelatedtonewandexistingproducts(includingchallengeswiththecompany’sabilitytoaccuratelypredictchangingconsumerpreferencesandfutureexpenditures,whichhasledtoandmaycontinuetoleadtoincreasedinventorylevels,andneedsandadvancesintechnologyandtheresultingimpactoncustomerinventorylevelsandtheimpactofreducedhospitaladmissionratesandelectivesurgeryvolumes),andtheimpactofthoseproductsonqualityandpatientsafetyconcerns;thecontinuity,availabilityandpricingofacceptablerawmaterialsandcomponentparts(andthecompany’sabilitytopasssomeorallofthesecoststothecompany’scustomersthroughrecentpriceincreasesorotherwise),andtherelatedcontinuityofthecompany’smanufacturinganddistributionandthoseofthecompany’ssuppliers;inabilitytocreateadditionalproductioncapacityinatimelymannerortheoccurrenceofothermanufacturing,sterilizationorsupplydifficulties(includingasaresultofnaturaldisaster,publichealthcrisesandepidemics/pandemics,regulatoryactionsorotherwise);productdevelopmentrisks,includingsatisfactoryclinicalperformanceandobtainingandmaintainingrequiredregulatoryapprovals(includingasaresultofevolvingregulatoryrequirements),theabilitytomanufactureatappropriatescale,andthegeneralunpredictabilityassociatedwiththeproductdevelopmentcycle;thecompany’sabilitytofinanceanddevelopnewproductsorenhancementsoncommerciallyacceptabletermsoratall;lossofkeyemployees,theoccurrenceoflabordisruptionsortheinabilitytoidentifyandrecruitnewemployees;productqualityorpatientsafetyissuesleadingtoproductrecalls,withdrawals,launchdelays,warningletters,importbans,sanctions,seizures,litigation,ordecliningsales,includingthefocusonevaluatingproductportfoliosforthepotentialpresenceorformationofnitrosamines;breachesorfailuresofthecompany’sinformationtechnologysystemsorproducts,includingbycyber-attack,dataleakage,unauthorizedaccessortheft(asaresultofremoteworkingarrangementsorotherwise);futureactionsof(orfailurestoactordelaysinactingby)FDA,theEuropeanMedicinesAgencyoranyotherregulatorybodyorgovernmentauthority(includingtheSEC,DepartmentofJustice,theFederalTradeCommission,CentersforMedicare&MedicaidServicesortheAttorneyGeneralofanyState)thatcoulddelay,limitorsuspendproductdevelopment,manufacturing,saleorreimbursementorresultinseizures,recalls,injunctions,monetarysanctionsorcriminalorcivilliabilities,includingthecontinueddelayinliftingthewarningletteratthecompany’sAhmedabadfacility;failureswithrespecttothecompany’squality,complianceorethicsprograms;futureactionsofthirdparties,includingthird-partypayersandthecompany’scustomersanddistributors(includinggrouppurchasingorganizationsandintegrateddeliverynetworks),theimpactofhealthcarereformanditsimplementation,suspension,repeal,replacement,amendment,modificationandothersimilaractionsundertakenbytheUnitedStatesorforeigngovernments;theoutcomeofpendingorfuturelitigation,includingtheopioid,ethyleneoxideandLinetantitrustlitigationorotherclaims;theimpactofcompetitiveproductsandpricing,includinggenericcompetition,drugreimportationanddisruptivetechnologies;globalregulatory,tradeandtaxpolicies(includingwithrespecttoclimatechangeandothersustainabilitymatters);theabilitytoprotectorenforcethecompany’sownedorin-licensedpatentorotherproprietaryrights(includingtrademarks,copyrights,tradesecretsandknow-how)orpatentsofthirdpartiespreventingorrestrictingthecompany’smanufacture,saleoruseofaffectedproductsortechnology;theimpactofanygoodwillorotherintangibleassetimpairmentsonthecompany’soperatingresults;fluctuationsinforeignexchangeandinterestrates;anychangesinlawconcerningthetaxationofincome(whetherwithrespecttocurrentorfuturetaxreform);actionsbytaxauthoritiesinconnectionwithongoingtaxaudits;andotherrisksidentifiedinBaxter’smostrecentfilingsonForm10-KandForm10-QandotherSECfilings,allofwhichareavailableonBaxter’swebsite.Baxterdoesnotundertaketoupdateitsforward-lookingstatementsunlessotherwiserequiredbythefederalsecuritieslaws.

2

USEOFNON-GAAPFINANCIALMEASURES

TosupplementBaxter’sconsolidatedfinancialstatementspresentedonaU.S.GAAPbasis,thecompanydisclosescertainnon-GAAPfinancialmeasures.Thesenon-GAAPfinancialmeasuresarenotinaccordancewithgenerallyacceptedaccountingprinciplesintheUnitedStates.

Areconciliationofthenon-GAAPfinancialmeasuresincludedinthisdocumenttothecorrespondingU.S.GAAPmeasuresfollowsinthesectiontitledNon-GAAPReconciliations.Inaddition,anexplanationofthewaysinwhichBaxtermanagementusesthesesupplementalnon-GAAPmeasurestoevaluateitsbusinessandthesubstantivereasonswhyBaxtermanagementbelievesthatthesenon-GAAPmeasuresprovideusefulinformationtoinvestorsisincludedinthecompany’smostrecentearningsreleasefiledwiththeSEConForm8-KonApril27,2023.Thisinformationshouldbeconsideredinadditionto,andnotassubstitutesfor,informationpreparedinaccordancewithU.S.GAAP.

Baxterstronglyencouragesinvestorstoreviewitsconsolidatedfinancialstatementsandpubliclyfiledreportsintheirentiretyandcautionsinvestorsthatthenon-GAAPmeasuresusedbythecompanymaydifferfromsimilarmeasuresusedbyothercompanies,evenwhensimilartermsareusedtoidentifysuchmeasures.

Non-GAAPfinancialmeasuresusedinthispresentationincludeconstantcurrencysalesgrowth,adjustedgrossmargin,adjustedoperatingmargin,adjustedselling,general,andadministrative(SG&A)expense,adjustedresearchanddevelopment(R&D)expense,adjustedotheroperatingincome,net,adjustedoperatingincome,adjustedincomebeforeincometaxes,adjustedincometaxexpense,adjustednetincome,adjustednetincomeattributabletoBaxterstockholders,adjusteddilutedearningspershare(EPS)andfreecashflow.

AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.

3

TABLEOFCONTENTS

NewOperatingModel5

PerformanceSummary6

FinancialResults12

2023Outlook17

Non-GAAPReconciliations20

4

Q12023BaxterSales

$0.7B

$0.2B$1.2B

$0.2B

$0.3B $0.1B$0.7B

$0.3B

MedicalProducts

andTherapies2

Healthcare

SystemsandTechnologies

5

ACTIONINGSIMPLIFICATIONPLANSTODRIVESTRATEGICCLARITY,

IMPROVEOPERATIONALEFFICIENCIESANDACCELERATEGROWTH

1

MedicationDelivery

AdvancedSurgery

ClinicalNutrition

PatientSupportSystemsGlobalSurgicalSolutions

FrontLineCare

Pharmaceuticals

BioPharmaSolutions3

RenalCare

AcuteTherapies

$0.5B $0.7B

$0.1B

$0.9B

$1.1B$0.2B

Pharmaceuticals2

KidneyCare

Uponcompletion,segmentswillberesponsiblefor:

Upstreamanddownstreamcommercialoperations

Researchanddevelopment

Manufacturinganddistribution

P&Laccountability

1Totalsalesincludes$27Mofothersalesnotpresentedabove.2Totalsmaynotaddacrossduetorounding.

3BaxterispursuingstrategicalternativesfortheBioPharmaSolutionsbusiness,whichcouldincludeasale.

E

Y

PERFORMANC

SUMMAR

First-Quarter2023Earnings

2023

April27,

6

EXECUTINGONOURSTRATEGYFORVALUECREATION

RECENTHIGHLIGHTS

Q12023Results1

1Q12023constantcurrencysalesincreased2%andadjusteddilutedEPSdeclined37%reflectingincreasedsupplychainrelatedcostsduetoinflationarypressures,thenegativeimpactofforeignexchangeandhigherinterestexpense;resultsaheadofexpectations

InvestingInGrowthOpportunitiesAndExecutingOnARobustPipelineOfLaunches2

1ResubmittedNovumIQlargevolumepump(LVP)forU.S.FDA510(k)clearance.TheLVPpumpispartofBaxter’sleadingedgeNovumIQinfusionplatform,whichincludesbothlargevolumeandsyringe(SYR)infusionpumps

1LaunchedZosynInjectionpremixinBaxter’sproprietaryGalaxycontainers,whichenablepremixedmedicationstohavealongershelflife

1LaunchedFloseal+Recothrom,thefirstandonlyactiveflowablehemostatwitharecombinantthrombin,resultingin1.5xfasterpreparation

1IntroducedReadyConnectSystemforBaxter’sCentrellaSmart+Bed.Thisinnovativesystemdeliversreliable,cable-freeconnectivitybetweenthehospitalbedandmostnursecallsystemsonthemarket

1LaunchedExactaMixPro,anextgenerationautomatednutritioncompounderwhichoffersawidearrayofenhancementsdesignedtostrengthensecurity,improvecustomerexperienceandofferstrongerdatareportingcapabilities

EnhancingValueForShareholders

1Paidquarterlydividendof$0.29pershare,reflectingcontinuedcommitmenttoreturnvaluetoshareholders

1PursuingpotentialstrategicalternativesfortheBioPharmaSolutionsbusiness,includingapotentialsaleorotherseparationoptions

1Advancingprogressofthecompany’sproposedspinoffofitsRenalCareandAcuteTherapiesproductcategoriesintoanindependent,publiclytradedcompany.CurrentlyexpectedtotakeplacebyJuly2024orearlier,subjecttothesatisfactionofcustomaryconditions

CreatingABestPlaceToWorkAndDemonstratingLeadershipInCorporateSocialResponsibility

1BaxterandBaxterInternationalFoundationadvancedsupportfordisasterreliefinresponsetoFebruary’sdevastatingearthquakeinTurkeyandSyria,includingcashgrantsandproductdonations

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowthandadjusteddilutedEPSgrowth.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.2See

fororiginalpressreleaseswithadditionalproductinformation.

7

PERFORMANCEHIGHLIGHTS

First-Quarter2023

(2%)Reported

+2%ConstantCurrency1

$3.6B

Sales

Adjusted241.2%

(380bps)

13.8%

(420bps)

$0.59

(37%)

GAAP

36.9%

+50bps

5.1%

+70bps

$0.09

(36%)

KeyMetrics

GrossMargin

YOYChange

OperatingMargin

YOYChange

DilutedEPS

YOYChange

8

1Constantcurrencysalesgrowthexcludestheimpactofforeignexchange.2Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowth,adjustedgrossmargin,adjustedoperatingmargin,andadjusteddilutedEPS.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.

KEYFINANCIALMETRICS

FIRST-QUARTER2023SNAPSHOT1

GlobalReportedSales

AdjustedOperatingMargin

18.0%

$0.59

(37%)

AdjustedDilutedEPS

$3.7B$3.6B

$0.93

ConstantGrowth2

+2%

13.8%

(420bps)

Q12022Q12023Q12022Q12023Q12022Q12023

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowth,adjustedoperatingmargin,andadjusteddilutedEPS.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.2Q12023constantcurrencysalesgrowthexcludestheimpactofforeignexchangeofapproximately(4%);U.S.GAAPsalesgrowthfortheperiodwasapproximately(2%)comparedtoQ12022.

9

FIRST-QUARTER2023PERFORMANCE1

(2%)

+2%

$0.09

(36%)

$0.59

(37%)

~(3%)

~(1%)

$0.14-$0.18

0%-29%

$0.46-$0.50

(51%)-(46%)

SolidPerformanceReflectsSustainedDemandForBaxter’s

MedicallyEssentialProductsAndTherapiesAmidAStabilizingMacroeconomicClimate

Q12023

Actual

Q12023

Guidance

Metric

SalesGrowth

Reported

SalesGrowth

ConstantCurrency

GAAPDilutedEPS

Growthvs.Prior-YearPeriod

AdjustedDilutedEPS

Growthvs.Prior-YearPeriod

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowthandadjusteddilutedEPS.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat.

10

FIRST-QUARTER2023BUSINESSDRIVERS1

ProductCategorySales2CCGrowth3QuarterlyPerformanceDrivers

RenalCare

$892M

+4%

PerformancedrivenbysolidgrowthinPDbusinesspartiallyoffsetbylowerU.S.salesforIn-CenterHDproductsfollowingtheexitofadistributionagreementlastyear

MedicationDelivery

$687M

(0%)

ResultsinthequarterreflectstronggrowthinternationallyoffsetbylowersalesintheU.S.duetoachallengingyearoveryearcomparison

Pharmaceuticals

$523M

+5%

Growthinthequarterdrivenbyincreaseddemandforinternationaldrugcompoundingservicesanddouble-digitgrowthofU.S.injectablesportfolio

ClinicalNutrition

$224M

+3%

Performancedrivenbystrengthinternationallyforvitaminsandnutritioncompoundingproducts

AdvancedSurgery

$246M

+11%

Growthinthequarterreflectsanongoingrecoveryofelectiveprocedureswithsurgicalvolumesincreasingacrossallregions

AcuteTherapies

$180M

(1%)

ResultsforthisbusinessimpactedbyelevatedCRRTdemandinthepriorperiodduetohigherlevelsofCOVIDpatients

BioPharmaSolutions

$139M

(9%)

Salesdeclinedinlinewithexpectationsdrivenbyapproximately$35millioninlowerCOVIDvaccine-relatedsalesascomparedtotheprioryearperiod

PatientSupportSystems

$348M

(8%)

Performancereflectswhatwebelievetobeaslowdownincapitalspendingforcertainproductcategoriesandlowerrentalsalesascomparedtotheprioryearperiod

FrontLineCare

$302M

+4%

GrowthreflectsdemandforIntelligentDiagnosticsportfolioandmodestimprovementinavailabilityforelectromechanicalcomponents

GlobalSurgicalSolutions

$81M

+8%

Performanceinthequarterwasdrivenbyincreasedinternationalplacements

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowth.

AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.2Totalsalesincludes$27Mofothersalesnotpresentedabove.3Representsgrowthatconstantcurrency,adjustingfortheimpactofforeignexchange.

11

S

FINANCIALRESULT

First-Quarter2023Earnings

2023

April27,

12

FIRST-QUARTER2023SALESBYPRODUCTCATEGORY1

Q12023SalesTotalGrowth

$InMillions

RenalCare

MedicationDeliveryPharmaceuticalsClinicalNutritionAdvancedSurgeryAcuteTherapiesBioPharmaSolutionsPatientSupportSystemsFrontLineCare

GlobalSurgicalSolutionsOther

TotalBaxter

Total

$892

$687

$523

$224

$246

$180

$139

$348

$302

$81

$27

$3,649

Reported

Constant

+4%

(0%)

+5%

+3%

+11%

(1%)

(9%)

(8%)

+4%

+8%

(16%)

+2%

U.S.

$232

$436

$173

$78

$144

$61

$69

$260

$221

$38

$22

$1,734

International

$660

$251

$350

$146

$102

$119

$70

$88

$81

$43

$5

$1,915

(0%)

(3%)

+0%

(1%)

+8%

(4%)

(11%)

(9%)

+3%

+4%

(16%)

(2%)

13

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowth.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.

FIRST-QUARTER2023SALESBYOPERATINGSEGMENT1

TotalGrowth

Q12023Sales

$InMillions

Americas

(NorthandSouthAmerica)

Reported

(1%)

+2%

(4%)

(3%)

(2%)

Constant

(1%)

+9%

Reported

$1,602

EMEA

(Europe,MiddleEastandAfrica)

APAC

(AsiaPacific)

Hillrom

TotalBaxter

$714

+3%

(2%)

+2%

$602

$731

$3,649

14

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowth.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.

FIRST-QUARTER2023ADJUSTEDFINANCIALRESULTS1

(380bps)

+10bps

+30bps

(420bps)

(37%)

Q12022Q12023Change

AdjustedGrossMargin

AdjustedSG&AExpense

(%ofSales)

45.0%

23.1%

41.2%

23.2%

AdjustedR&DExpense

(%ofSales)

4.3%

4.0%

AdjustedOperatingMargin18.0%13.8%

AdjustedDilutedEPS$0.93$0.59

1Non-GAAPfinancialmetricsreferencedinthisslideincludeadjustedgrossmargin,adjustedSG&Aexpense,adjustedR&Dexpense,adjustedoperatingmargin,andadjusteddilutedEPS.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.

15

EXECUTINGPORTFOLIOMANAGEMENTACTIONSTO

ACCELERATEDISCIPLINEDCAPITALALLOCATIONSTRATEGY

PORTFOLIO

MANAGEMENT

DEBTREPAYMENTDIVIDENDS

SHAREREPURCHASES

CurrentlypursuingstrategicalternativesforBioPharmaSolutionsbusiness;assessingadditionalinorganicgrowthvectorsforproducts,therapies,andconnectedcareplatforms

Paidquarterlydividendof$0.29pershare,reflectingcontinuedcommitmenttoreturnvaluetoshareholders

Expectingtoreinstatesharerepurchasesovertime

Committedtodeleveragingwith

$250Mofcommercialpaper

reductionyeartodate;planning

toutilizeproceedsfrom

proposedspinoffofKidneyCare

andpotentialstrategicasset

salestoaccelerateBaxterdebt

repaymentschedule

~$1.7BillionOfCashAndCashEquivalentsOnHandWithAccessto$2.2BillionofCombinedUSDandEUR

CreditFacilitiesAsOfMarch31,2023.

16

K

2023OUTLOO

First-Quarter2023Earnings

2023

April27,

17

SECOND-QUARTER2023GUIDANCE1

Q22023

Guidance

SalesGrowth

Reported

1%-2%

ForeignExchange

<(100)bps

SalesGrowth

ConstantCurrency

GAAPDilutedEPS

Growthvs.Prior-YearPeriod

AdjustedDilutedEPS

Growthvs.Prior-YearPeriod

2%-3%

$0.18-$0.20

(64%)–(60%)

$0.59-$0.61

(32%)-(30%)

18

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowthandadjusteddilutedEPS.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat

.

FULL-YEAR2023GUIDANCE1

SalesGrowth

Reported

ForeignExchange

SalesGrowth

ConstantCurrency

GAAPDilutedEPS

Growthvs.Prior-YearPeriod

AdjustedDilutedEPS

Growthvs.Prior-YearPeriod

FY2023

Guidance

1%-2%

<50bps

~1%

$1.16-$1.31

NM2

$2.85-$3.00

(19%)-(14%)

19

1Non-GAAPfinancialmetricsreferencedinthisslideincludeconstantcurrencysalesgrowthandadjusteddilutedEPS.AreconciliationtocomparableU.S.GAAPmeasurescanbefoundhereinandisavailableat.2NotMeaningful.

NON-GAAP

RECONCILIATION

S

First-Quarter2023Earnings

2023

April27,

20

NON-GAAPRECONCILIATIONSASOFAPRIL27,2023

Non-GAAPReconciliations:

AspartofitsQ12023earningsannouncementonApril27,2023,Baxterpresenteditsfinancialresultsforthefirstquarterof2023.Baxteralsopresentedguidanceforthesecondquarterandfullyearof2023.Inthesepresentations,Baxterusednon-GAAPfinancialmeasuresofsalesgrowthonaconstantcurrencybasis,adjustedgrossmargin,adjustedselling,generalandadministrativeexpense,adjustedresearchanddevelopmentexpense,adjustedoperatingincome,adjustedoperatingmargin,adjusteddilutedearningspershare,andfreecashflow.Thereconciliationssetforthbelowreconcilethenon-GAAPmeasuressetforthinthispresentationforhistoricalperiodstothemostdirectlycomparableU.S.GAAPmeasures.

21

DESCRIPTIONOFADJUSTMENTSANDRECONCILIATIONSOFU.S.GAAPTONON-GAAPMEASURES

ThreeMonthsEndedMarch31,2023

(unaudited)

(inmillions,exceptpershareandpercentagedata)

Thecompany’sU.S.GAAPresultsforthethreemonthsendedMarch31,2023includedspecialitemswhichimpactedtheU.S.GAAPmeasuresasfollows:

Selling,

Income

NetIncome

Generaland

Researchand

Other

Before

Attributableto

Diluted

Administrative

Development

Operating

Operating

Income

IncomeTax

Baxter

EarningsPer

GrossMarginExpenses

Expenses

Income,Net

Income

Taxes

Expense

NetIncome

Stockholders

Share

Reported

Reportedpercentofnetsales(orpercentofincomebeforeincometaxesforincometaxexpense)

Intangibleassetamortization1

Businessoptimizationitems2

Acquisitionandintegrationitems3

Divestiture-relatedcosts4

Europeanmedicaldevicesregulation5

Adjusted

Adjustedpercentofnetsales(oradjustedpercentofincomebeforeincometaxesforincometaxexpense)

$1,347$1,010$164$(13)$186$70$25$45$44$

36.9%27.7%4.5%(0.4)%5.1%1.9%35.7%1.2%1.2%

110(52)——16216236126126

35(92)(7)—13413427107107

—(6)—13(7)(7)(2)(5)(5)

1(15)——1616—1616

12———1212399

$1,505$845$157$—$503$387$89$298$297$

41.2%23.2%4.3%0.0%13.8%10.6%23.0%8.2%8.1%

0.09

0.25

0.21

(0.01)

0.03

0.02

0.59

22

DESCRIPTIONOFADJUSTMENTSANDRECONCILIATIONSOFU.S.GAAPTONON-GAAPMEASURES

ThreeMonthsEndedMarch31,2022

(unaudited)

(inmillions,exceptpershareandpercentagedata)

Thecompany’sU.S.GAAPresultsforthethreemonthsendedMarch31,2022includedspecialitemswhichimpactedtheU.S.GAAPmeasuresasfollows:

Selling,Generaland

Administrative

GrossMarginExpenses

Researchand

Development

Expenses

Other

Operating

Expense,Net

Operating

Income

Income

Before

Income

Taxes

IncomeTaxExpense

NetIncome

NetIncome

Attributableto

BaxterStockholders

Diluted

EarningsPer

Share

Reported

Reportedpercentofnetsales(orpercentofincomebeforeincometaxesforincometaxexpense)

Intangibleassetamortization1

Businessoptimizationitems2

Acquisitionandintegrationitems3

Europeanmedicaldevicesregulation5

Product-relateditems6

Adjusted

Adjustedpercentofnetsales(oradjustedpercentofincomebeforeincometaxesforincometaxexpense)

$1,348$1,052$150$(17)$163$94$21$73$71$

36.4%28.4%4.0%(0.5)%4.4%2.5%22.3%