Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

AbbVie Inc., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2025	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
Net earnings	4,233)	4,286)	4,873)	11,845)	11,549)
Depreciation	762)	764)	752)	778)	803)
Amortization of intangible assets	7,377)	7,622)	7,946)	7,689)	7,718)
Deferred income taxes	(492)	(1,449)	(2,889)	(1,931)	(898)
Change in fair value of contingent consideration liabilities	6,495)	3,771)	5,128)	2,761)	2,679)
Payments of contingent consideration liabilities	(2,865)	(1,995)	(870)	(164)	(91)
Stock-based compensation	955)	911)	747)	671)	692)
Acquired IPR&D and milestones	5,016)	2,757)	778)	697)	1,124)
Other charges related to collaborations	—)	—)	—)	—)	500)
Gain on divestitures	—)	—)	—)	(172)	(68)
Non-cash litigation reserve adjustments, net of cash payments	(933)	508)	(443)	2,243)	163)
Impairment of intangible assets	847)	4,476)	4,229)	770)	50)
Other, net	(3)	(63)	(225)	(150)	(213)
Accounts receivable	(1,490)	207)	66)	(1,455)	(1,321)
Inventories	(234)	(319)	(417)	(686)	(142)
Prepaid expenses and other assets	(827)	361)	(188)	(264)	(197)
Accounts payable and other liabilities	951)	177)	3,840)	1,769)	1,719)
Income tax assets and liabilities, net	(762)	(3,208)	(488)	542)	(1,290)
Changes in operating assets and liabilities, net of acquisitions	(2,362)	(2,782)	2,813)	(94)	(1,231)
Adjustments to reconcile net earnings to net cash from operating activities	14,797)	14,520)	17,966)	13,098)	11,228)
Cash flows from operating activities	19,030)	18,806)	22,839)	24,943)	22,777)
Acquisition of businesses, net of cash acquired	(204)	(17,493)	—)	(255)	(525)
Other acquisitions and investments, net of cash acquired	(5,237)	(3,024)	(1,223)	(539)	(1,377)
Acquisitions of property and equipment	(1,214)	(974)	(777)	(695)	(787)
Purchases of investment securities	(35)	(73)	(77)	(1,438)	(119)
Sales and maturities of investment securities	76)	555)	55)	1,530)	98)
Other, net	(29)	189)	13)	774)	366)
Cash flows from investing activities	(6,643)	(20,820)	(2,009)	(623)	(2,344)
Net change in commercial paper borrowings with original maturities of three months or less	499)	—)	—)	—)	—)
Proceeds from issuance of other short-term borrowings	4,798)	5,008)	—)	—)	—)
Repayments of other short-term borrowings	(2,798)	(5,008)	—)	—)	—)
Proceeds from issuance of long-term debt	3,994)	16,963)	—)	2,000)	1,000)
Repayments of long-term debt and finance lease obligations	(6,797)	(9,613)	(4,149)	(14,433)	(9,414)
Debt issuance costs	(23)	(99)	(38)	—)	—)
Dividends paid	(11,657)	(11,025)	(10,539)	(10,043)	(9,261)
Purchases of treasury stock	(980)	(1,708)	(1,972)	(1,487)	(934)
Proceeds from the exercise of stock options	172)	214)	180)	262)	244)
Payments of contingent consideration liabilities	—)	—)	(752)	(1,132)	(698)
Other, net	68)	57)	48)	30)	24)
Cash flows from financing activities	(12,724)	(5,211)	(17,222)	(24,803)	(19,039)
Effect of exchange rate changes on cash and equivalents	42)	(65)	5)	(62)	(97)
Net change in cash and equivalents	(295)	(7,290)	3,613)	(545)	1,297)
Cash and equivalents, beginning of year	5,524)	12,814)	9,201)	9,746)	8,449)
Cash and equivalents, end of year	5,229)	5,524)	12,814)	9,201)	9,746)

Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).

The financial statement information reveals significant fluctuations in cash flows over the five-year period. While operating cash flow remains generally positive, substantial shifts are observed in investing and financing activities, impacting the overall cash position.

Operating Activities: Cash flows from operating activities demonstrate initial growth from $22,777 million in 2021 to $24,943 million in 2022, followed by a decrease to $22,839 million in 2023. A more pronounced decline is evident in 2024, falling to $18,806 million, with a slight recovery to $19,030 million in 2025. This volatility is linked to changes in net earnings, which experienced a substantial reduction beginning in 2023, and adjustments to reconcile net earnings to net cash flow. Notably, non-cash litigation reserve adjustments and impairment of intangible assets significantly impacted these adjustments, particularly in 2023 and 2024.
Investing Activities: Cash flows from investing activities are consistently negative, indicating ongoing investments. The outflow accelerates dramatically in 2024 to -$20,820 million, primarily driven by a large acquisition of businesses. While the outflow lessens to -$6,643 million in 2025, it remains substantial. Acquisitions of property and equipment, along with other investments, contribute to the consistent negative cash flow in this category. Sales and maturities of investment securities provide some offsetting inflows, but are insufficient to counteract the outflows.
Financing Activities: Financing activities exhibit significant negative cash flows throughout the period, peaking at -$24,803 million in 2022. This is largely attributable to substantial repayments of long-term debt and consistent dividend payments. Proceeds from the issuance of long-term debt partially offset these outflows, particularly in 2022 and 2024, but are not enough to generate positive cash flow. Purchases of treasury stock also contribute to the negative cash flow. A notable shift occurs in 2025, with a decrease in negative cash flow to -$12,724 million, potentially due to reduced debt repayments and treasury stock purchases.
Net Change in Cash and Equivalents: The net change in cash and equivalents fluctuates considerably. A positive change of $1,297 million is observed in 2021, followed by a negative change of -$545 million in 2022. A substantial positive change of $3,613 million occurs in 2023, but is reversed by a significant negative change of -$7,290 million in 2024, and a smaller negative change of -$295 million in 2025. These fluctuations align with the combined effects of operating, investing, and financing activities.
Key Adjustments: Several non-cash items significantly influence cash flow from operations. Amortization of intangible assets consistently contributes a substantial positive adjustment. Deferred income taxes and changes in fair value of contingent consideration liabilities demonstrate considerable volatility, impacting the overall cash flow picture. The impairment of intangible assets also represents a significant adjustment, particularly in 2023 and 2024.

Overall, the company demonstrates a capacity to generate cash from operations, but this is consistently offset by substantial investments and financing activities, particularly debt repayment and shareholder returns. The large acquisition in 2024 significantly impacted cash flows, and the trend suggests a strategic focus on managing debt and returning capital to shareholders alongside continued investment in the business.

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AbbVie Inc. (NYSE:ABBV)

Cash Flow Statement