Company: ABBV
Filing Date: 2025-08-04
Form Type: 10-Q
Source: 0001551152-25-000040
Chunk: 14

Company: AbbVie Inc.
Filing Date: 2025-08-04
Form: 10-Q
Item: Part I, Item 2
Chunk 14
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 the prior year primarily due to a higher average debt balance.

Interest income decreased for the three and six months ended June 30, 2025 compared to the prior year primarily due to a lower average cash and equivalents balance.

Other expense, net included charges related to changes in fair value of contingent consideration liabilities of $2.8 billion for the three months and $4.3 billion for the six months ended June 30, 2025 and $1.5 billion for the three months and $2.1 billion for the six months ended June 30, 2024. The fair value of contingent consideration liabilities is impacted by the passage of time and multiple other inputs, including the probability of success of achieving regulatory milestones, discount rates, the estimated amount of future sales of the acquired products and other market-based factors. For the three and six months ended June 30, 2025, the change in fair value reflected higher estimated Skyrizi sales, the passage of time and lower discount rates. For the three and six months ended June 30, 2024, the change in fair value reflected higher estimated Skyrizi sales and the passage of time, partially offset by higher discount rates.

Income Tax Expense

The effective tax rate was 39% for the three months and 31% for the six months ended June 30, 2025 compared to 36% for the three months and 30% for the six months ended June 30, 2024. The effective tax rate in each period differed from the U.S. statutory tax rate of 21% principally due to the impact of foreign operations which reflects the impact of lower income tax rates in locations outside the United States, changes in fair value of contingent consideration and business development activities. The increase in the effective tax rate for the three and six months ended June 30, 2025 over the prior year was primarily due to changes in fair value of contingent consideration offset by changes in jurisdictional mix of earnings and business development activities. 

2025 Form 10-Q | 34

 FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCESSix months endedJune 30,(in millions)20252024Cash flows provided by (used in):Operating activities$6,788 $6,311 Investing activities(1,916)(10,690)Financing activities(3,968)4,722 

Operating cash flows for the six months ended June 30, 2025 increased compared to the prior