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.

Johnson & Johnson, consolidated cash flow statement

US$ in millions

12 months ended:	Dec 28, 2025	Dec 29, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
Net earnings	26,804)	14,066)	35,153)	17,941)	20,878)
Depreciation and amortization of property and intangibles	7,503)	7,339)	7,486)	6,970)	7,390)
Stock based compensation	1,354)	1,176)	1,162)	1,138)	1,135)
Asset write-downs	204)	405)	1,295)	1,216)	989)
Charges for acquired in-process research and development	109)	1,841)	483)	—)	—)
Gain on Kenvue separation	—)	—)	(20,984)	—)	—)
Net gain on sale of assets/businesses	(263)	(226)	(117)	(380)	(617)
Deferred tax provision	1,538)	(2,183)	(4,194)	(1,663)	(2,079)
Credit losses and accounts receivable allowances	(1)	11)	—)	(17)	(48)
(Increase) decrease in accounts receivable	(1,781)	(406)	(624)	(1,290)	(2,402)
(Increase) decrease in inventories	(1,450)	(1,128)	(1,323)	(2,527)	(1,248)
Increase (decrease) in accounts payable and accrued liabilities	2,377)	1,621)	2,346)	1,098)	2,437)
(Increase) decrease in other current and non-current assets	(6,167)	1,717)	(3,480)	687)	(1,964)
Increase (decrease) in other current and non-current liabilities	(5,697)	33)	5,588)	(1,979)	(1,061)
Changes in assets and liabilities, net of effects from acquisitions and divestitures	(12,718)	1,837)	2,507)	(4,011)	(4,238)
Adjustments to reconcile net earnings to cash flows from operating activities	(2,274)	10,200)	(12,362)	3,253)	2,532)
Net cash flows from operating activities	24,530)	24,266)	22,791)	21,194)	23,410)
Additions to property, plant and equipment	(4,832)	(4,424)	(4,543)	(4,009)	(3,652)
Proceeds from the disposal of assets/businesses, net	720)	675)	358)	543)	711)
Acquisitions, net of cash acquired	(17,541)	(15,146)	—)	(17,652)	(60)
Acquired in-process research and development/related milestones	(385)	(1,783)	(470)	—)	—)
Purchases of investments	(920)	(1,726)	(10,906)	(32,384)	(30,394)
Sales of investments	1,661)	2,462)	19,390)	41,609)	25,006)
Credit support agreements activity, net	(2,129)	1,517)	(2,963)	(249)	214)
Other, including capitalized licenses and milestones	(162)	(174)	12)	(229)	(508)
Net cash (used by) from investing activities	(23,588)	(18,599)	878)	(12,371)	(8,683)
Dividends to shareholders	(12,381)	(11,823)	(11,770)	(11,682)	(11,032)
Repurchase of common stock	(5,953)	(2,432)	(5,054)	(6,035)	(3,456)
Proceeds from short-term debt	14,586)	15,277)	13,743)	16,134)	1,997)
Repayment of short-term debt	(12,330)	(9,463)	(22,973)	(6,550)	(1,190)
Proceeds from long-term debt, net of issuance costs	9,138)	6,660)	—)	2)	5)
Repayment of long-term debt	(1,757)	(1,453)	(1,551)	(2,134)	(1,802)
Proceeds from the exercise of stock options/employee withholding tax on stock awards, net	3,418)	838)	1,094)	1,329)	1,036)
Credit support agreements activity, net	(226)	272)	(219)	(28)	281)
Settlement of convertible debt acquired from Shockwave	—)	(970)	—)	—)	—)
Proceeds of short and long-term debt, net of issuance cost, related to the debt that transferred to Kenvue at separation	—)	—)	8,047)	—)	—)
Proceeds from Kenvue initial public offering	—)	—)	4,241)	—)	—)
Cash transferred to Kenvue at separation	—)	—)	(1,114)	—)	—)
Other	(34)	(38)	(269)	93)	114)
Net cash used by financing activities	(5,539)	(3,132)	(15,825)	(8,871)	(14,047)
Effect of exchange rate changes on cash and cash equivalents	201)	(289)	(112)	(312)	(178)
Increase (decrease) in cash and cash equivalents	(4,396)	2,246)	7,732)	(360)	502)
Cash and cash equivalents, beginning of year	24,105)	21,859)	14,127)	14,487)	13,985)
Cash and cash equivalents, end of year	19,709)	24,105)	21,859)	14,127)	14,487)

Based on: 10-K (reporting date: 2025-12-28), 10-K (reporting date: 2024-12-29), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).

The cash flow statement reveals fluctuating performance across the five-year period. While net cash flows from operating activities generally remained strong, significant shifts occurred in investing and financing activities, impacting overall cash position.

Operating Activities: Net cash flows from operating activities demonstrated relative stability, ranging from US$21.194 billion to US$24.530 billion. However, adjustments to reconcile net earnings to cash flows from operating activities experienced substantial volatility. A significant decrease was observed in 2023 (US$-12,362 million) primarily driven by a large gain on Kenvue separation, which is a non-cash item. This was followed by a large positive adjustment in 2024 (US$10,200 million). Changes in working capital accounts, particularly accounts receivable, inventories, and other assets/liabilities, contributed to fluctuations in operating cash flow, though generally remained within a manageable range.
Investing Activities: Net cash used in investing activities exhibited considerable variation. 2022 saw a substantial outflow (US$-12,371 million) largely due to significant purchases of investments. 2023 showed a positive cash flow (US$878 million) but this was followed by substantial outflows in 2024 (US$-18,599 million) and 2025 (US$-23,588 million) driven by acquisitions, net of cash acquired, and purchases of investments. Additions to property, plant, and equipment remained consistently negative, indicating ongoing capital expenditures, ranging from US$-3,652 million to US$-4,832 million annually. Proceeds from the disposal of assets/businesses provided a minor offset to these outflows.
Financing Activities: Financing activities demonstrated significant volatility. Net cash used in financing activities was substantial in 2021 (US$-14,047 million) and 2023 (US$-15,825 million), primarily due to dividend payments and common stock repurchases. Proceeds from short-term debt were a key source of funding in several years, particularly 2022 and 2024, while repayment of short-term debt also represented a significant cash outflow. The Kenvue separation significantly impacted financing activities in 2023, with proceeds from the initial public offering and related debt transfers contributing substantial inflows. Dividend payments and stock repurchases consistently represented significant cash outflows throughout the period.
Cash Position: The overall effect resulted in an increase in cash and cash equivalents in 2021, 2023, and 2024, but a decrease in 2022 and 2025. The largest increase occurred in 2023 (US$7,732 million), while the largest decrease was in 2025 (US$-4,396 million). The ending cash balance fluctuated, reaching US$19,709 million in 2025.

The company’s cash flow patterns suggest a dynamic capital allocation strategy, involving significant investment in growth initiatives, shareholder returns, and strategic separations. The impact of non-cash items, such as the Kenvue separation, significantly influenced operating cash flow adjustments. The substantial changes in investing and financing activities highlight the company’s active engagement in mergers, acquisitions, and capital market transactions.

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Johnson & Johnson (NYSE:JNJ)

Cash Flow Statement