Company: GEHC
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0001932393-25-000014
Chunk: 114

Company: GE HealthCare Technologies Inc.
Filing Date: 2025-04-30
Form: 10-Q
Item: Item 2
Chunk 114
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 120 basis points as a percent of Total revenues primarily due to a reduction in Cost of products sold as a percent of Total revenues. Cost of products sold decreased $4 million or 160 basis points as a percent of Sales of products. The decrease as a percent of sales was driven primarily by cost productivity, partially offset by unfavorable mix within our product offerings and cost inflation. Cost of services sold increased $20 million but decreased 40 basis points as a percent of Sales of services. The decrease as a percent of sales was driven by cost productivity and an increase in pricing of our service offerings, partially offset by unfavorable mix within our service offerings. Included in our total cost of revenue as part of our product investment was $96 million in engineering costs for design follow-through on new product introductions and product lifecycle maintenance subsequent to the initial product launch, compared to $101 million for the prior year comparable period; and

•Total operating expenses increased $21 million primarily due to an increase in Research and Development (“R&D”) investments of $20 million and an increase in Selling, general, and administrative (“SG&A”) expense of $2 million primarily driven by increased investment in our commercial teams, largely offset by a decrease in Spin-Off and separation costs. As a result, SG&A as a percentage of Total revenues decreased by 60 basis points and R&D as a percentage of Total revenues increased by 20 basis points.

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*Non-GAAP Financial Measure

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Net income attributable to GE HealthCare and Net income margin were $564 million and 11.8%, an increase of $190 million and 380 basis points, respectively, primarily due to the following factors:

•Operating income increased $89 million, as discussed above;

•Interest and other financial charges – net decreased $12 million primarily driven by repayments made on the Term Loan Facility;

•Non-operating benefit income decreased $28 million primarily due to lower expected returns on plan assets;

•Other income – net increased $107 million primarily driven by the remeasurement of the Company’s 50% interest in Nihon Medi-Physics Co., Ltd (“NMP”) based on the cash consideration exchanged for acquiring the remaining 50% equity interest. For additional detail on the NMP acquisition, refer to Note 7, “Acquisitions, Goodwill, and Other Intangible Assets”; and

•Provision for income taxes decreased $20 million primarily due to the release of income tax reserves in a foreign jurisdiction for tax