Analysis of Reportable Segments
Johnson & Johnson operates in 2 segments: Innovative Medicine and MedTech.
Segment Profit Margin
Johnson & Johnson, profit margin by reportable segment
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 36.86% | 33.21% | 33.32% | 27.89% | 29.19% |
| MedTech | 12.17% | 11.74% | 15.36% | 16.80% | 16.16% |
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).
Segment profit margins exhibited differing trends across the observed period. Innovative Medicine demonstrated consistent growth, while MedTech experienced more volatility and a general decline in profitability towards the end of the period.
- Innovative Medicine
- The Innovative Medicine segment’s profit margin began at 29.19% in 2021. A slight decrease to 27.89% was noted in 2022, followed by a substantial increase to 33.32% in 2023. This upward trajectory continued with margins of 33.21% in 2024 and further expansion to 36.86% in 2025. This indicates strengthening profitability within the Innovative Medicine segment.
- MedTech
- The MedTech segment’s profit margin started at 16.16% in 2021 and increased to 16.80% in 2022. A subsequent decrease to 15.36% occurred in 2023. A more pronounced decline was observed in 2024, with the margin falling to 11.74%. A modest recovery to 12.17% was recorded in 2025, but the segment remained below its initial profitability level. This suggests increasing pressure on profitability within the MedTech segment.
- Comparative Analysis
- The divergence in trends between the two segments is notable. While Innovative Medicine consistently improved its profit margin, MedTech experienced a decline, particularly in 2024. The gap between the segments’ profit margins widened over the period, with Innovative Medicine significantly outperforming MedTech by 2025. This difference warrants further investigation into the factors driving performance in each segment.
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Segment Profit Margin: Innovative Medicine
Johnson & Johnson; Innovative Medicine; segment profit margin calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income (loss) before tax | 22,266) | 18,919) | 18,246) | 18,831) | 19,475) |
| Sales to customers | 60,401) | 56,964) | 54,759) | 67,516) | 66,715) |
| Segment Profitability Ratio | |||||
| Segment profit margin1 | 36.86% | 33.21% | 33.32% | 27.89% | 29.19% |
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).
1 2025 Calculation
Segment profit margin = 100 × Income (loss) before tax ÷ Sales to customers
= 100 × 22,266 ÷ 60,401 = 36.86%
The Innovative Medicine segment demonstrated fluctuating performance between 2021 and 2025. While sales experienced a decline in 2023, they recovered in subsequent years, accompanied by a notable increase in income before tax. The segment profit margin exhibited a corresponding pattern of initial decline, followed by consistent improvement.
- Sales Performance
- Sales to customers peaked at US$67.516 billion in 2022 before decreasing to US$54.759 billion in 2023. A recovery was then observed, with sales reaching US$56.964 billion in 2024 and further increasing to US$60.401 billion in 2025. This suggests potential market challenges in 2023, followed by a successful rebound in sales.
- Income Before Tax
- Income before tax generally tracked sales trends, declining from US$19.475 billion in 2021 to US$18.246 billion in 2023. However, income increased significantly to US$18.919 billion in 2024 and continued to rise to US$22.266 billion in 2025. This indicates improved profitability alongside the sales recovery.
- Segment Profit Margin
- The segment profit margin decreased from 29.19% in 2021 to 27.89% in 2022, coinciding with the initial sales increase. A substantial increase was then observed in 2023, reaching 33.32%, despite the decline in sales. This suggests improved cost management or a shift in product mix towards higher-margin offerings. The margin remained relatively stable at 33.21% in 2024 before increasing further to 36.86% in 2025, indicating sustained profitability improvements alongside sales growth.
Overall, the Innovative Medicine segment experienced a period of volatility between 2021 and 2023, followed by a positive trend in both sales and profitability through 2025. The increasing segment profit margin, particularly in the later years, is a positive indicator of the segment’s financial health and operational efficiency.
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Segment Profit Margin: MedTech
Johnson & Johnson; MedTech; segment profit margin calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income (loss) before tax | 4,113) | 3,740) | 4,669) | 4,607) | 4,373) |
| Sales to customers | 33,792) | 31,857) | 30,400) | 27,427) | 27,060) |
| Segment Profitability Ratio | |||||
| Segment profit margin1 | 12.17% | 11.74% | 15.36% | 16.80% | 16.16% |
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).
1 2025 Calculation
Segment profit margin = 100 × Income (loss) before tax ÷ Sales to customers
= 100 × 4,113 ÷ 33,792 = 12.17%
The MedTech segment demonstrated fluctuating performance between 2021 and 2025. While sales generally increased over the period, segment profit margin experienced both improvements and declines.
- Sales Performance
- Sales to customers exhibited a consistent upward trajectory, increasing from US$27,060 million in 2021 to US$33,792 million in 2025. Growth was relatively steady between 2021 and 2023, with a more pronounced increase from 2023 to 2024 and continuing into 2025.
- Profitability Trends
- Segment profit margin initially improved from 16.16% in 2021 to 16.80% in 2022. However, a decline was observed in 2023, with the margin falling to 15.36%. This downward trend accelerated in 2024, reaching a low of 11.74%. A modest recovery occurred in 2025, with the segment profit margin increasing to 12.17%, but remained below levels seen in 2021 and 2022.
- Income Before Tax
- Income before tax generally tracked the sales trend, increasing from US$4,373 million in 2021 to US$4,669 million in 2023. A significant decrease was noted in 2024, falling to US$3,740 million, before partially recovering to US$4,113 million in 2025. The decline in income before tax in 2024 aligns with the substantial reduction in segment profit margin observed during the same period.
The divergence between increasing sales and decreasing profit margin, particularly evident in 2024, suggests potential pressures on cost of goods sold or increased operating expenses within the MedTech segment. While sales continue to grow, maintaining or improving profitability will require attention to expense management and pricing strategies.
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Segment Return on Assets (Segment ROA)
Johnson & Johnson, ROA by reportable segment
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 28.53% | 33.15% | 31.28% | 22.82% | 21.77% |
| MedTech | 4.76% | 4.44% | 6.25% | 6.49% | 8.19% |
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).
Segment Return on Assets (ROA) for Innovative Medicine and MedTech demonstrates distinct performance trajectories over the five-year period. The Innovative Medicine segment exhibits a generally positive trend, while MedTech displays a pattern of decline and stabilization.
- Innovative Medicine
- The Innovative Medicine segment experienced consistent growth in ROA from 2021 to 2023, increasing from 21.77% to 31.28%. This represents a substantial improvement in asset utilization and profitability within this segment. The upward trend continued into 2024, reaching a peak of 33.15%. A slight decrease was observed in 2025, with ROA settling at 28.53%, though remaining significantly above the 2021 level. This suggests continued strong performance, with a minor pullback in the most recent year.
- MedTech
- In contrast, the MedTech segment’s ROA decreased from 8.19% in 2021 to 6.49% in 2022. This downward trend persisted in 2023, with a further decline to 6.25%. The segment experienced its lowest ROA in the period in 2024, at 4.44%. A modest recovery was noted in 2025, with ROA increasing to 4.76%, indicating a potential stabilization, but still remaining below levels observed in earlier years. The performance of this segment suggests challenges in maintaining profitability relative to its asset base.
The divergence in segment performance is notable. While Innovative Medicine demonstrates increasing efficiency and returns, MedTech’s ROA indicates potential operational or market pressures. Further investigation into the factors driving these differing trends would be beneficial.
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Segment ROA: Innovative Medicine
Johnson & Johnson; Innovative Medicine; segment ROA calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income (loss) before tax | 22,266) | 18,919) | 18,246) | 18,831) | 19,475) |
| Identifiable assets | 78,057) | 57,070) | 58,324) | 82,504) | 89,457) |
| Segment Profitability Ratio | |||||
| Segment ROA1 | 28.53% | 33.15% | 31.28% | 22.82% | 21.77% |
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).
1 2025 Calculation
Segment ROA = 100 × Income (loss) before tax ÷ Identifiable assets
= 100 × 22,266 ÷ 78,057 = 28.53%
The Innovative Medicine segment demonstrated fluctuating performance between 2021 and 2025. Income before tax exhibited a general pattern of initial decline followed by recovery, while identifiable assets experienced a more pronounced decrease before a subsequent increase. These movements significantly impacted the segment’s Return on Assets (ROA).
- Income Before Tax
- Income before tax decreased from US$19,475 million in 2021 to US$18,831 million in 2022, representing a decline of approximately 3.3%. A further decrease was observed in 2023, falling to US$18,246 million. However, income began to recover in 2024, reaching US$18,919 million, and continued to rise substantially in 2025 to US$22,266 million, indicating a positive trend in recent periods.
- Identifiable Assets
- Identifiable assets decreased notably from US$89,457 million in 2021 to US$82,504 million in 2022, a reduction of approximately 7.9%. This downward trend accelerated in 2023, with assets falling to US$58,324 million. Assets remained relatively stable in 2024 at US$57,070 million before increasing significantly to US$78,057 million in 2025. This suggests potential strategic asset reallocation or divestitures followed by reinvestment.
- Segment ROA
- Segment ROA initially increased from 21.77% in 2021 to 22.82% in 2022, despite the slight decrease in income before tax. A substantial increase in ROA was then observed in 2023, reaching 31.28%, driven by the more significant decline in identifiable assets. This trend continued into 2024, with ROA reaching 33.15%, representing the highest value in the observed period. In 2025, ROA decreased to 28.53%, likely due to the increase in identifiable assets outpacing the growth in income before tax. The overall trend indicates increasing efficiency in asset utilization, although the most recent period shows a moderation of this improvement.
The interplay between income before tax and identifiable assets demonstrates a complex dynamic within the segment. While income experienced fluctuations, the more substantial changes in asset levels had a pronounced effect on the segment’s ROA. The significant asset increase in 2025 warrants further investigation to understand the nature of these investments and their potential impact on future profitability.
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Segment ROA: MedTech
Johnson & Johnson; MedTech; segment ROA calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Income (loss) before tax | 4,113) | 3,740) | 4,669) | 4,607) | 4,373) |
| Identifiable assets | 86,482) | 84,322) | 74,710) | 70,956) | 53,372) |
| Segment Profitability Ratio | |||||
| Segment ROA1 | 4.76% | 4.44% | 6.25% | 6.49% | 8.19% |
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).
1 2025 Calculation
Segment ROA = 100 × Income (loss) before tax ÷ Identifiable assets
= 100 × 4,113 ÷ 86,482 = 4.76%
The MedTech segment demonstrated fluctuating performance in profitability relative to its asset base between 2021 and 2025. Income before tax and identifiable assets both exhibited increases initially, followed by shifts in later periods. Segment Return on Assets (ROA) reflects these changes, showing a decline from 2021 before a slight recovery in the most recent year.
- Income Before Tax
- Income before tax increased from US$4,373 million in 2021 to US$4,607 million in 2022, and continued to rise to US$4,669 million in 2023. A decrease was then observed in 2024, falling to US$3,740 million, before partially recovering to US$4,113 million in 2025. This suggests potential challenges in maintaining consistent profitability within the segment.
- Identifiable Assets
- Identifiable assets increased significantly from US$53,372 million in 2021 to US$70,956 million in 2022, and continued to grow to US$74,710 million in 2023. Further asset growth occurred in 2024, reaching US$84,322 million, and continued modestly to US$86,482 million in 2025. The consistent increase in assets indicates ongoing investment within the MedTech segment.
- Segment ROA
- Segment ROA began at 8.19% in 2021, declining to 6.49% in 2022 and 6.25% in 2023. A more pronounced decrease was seen in 2024, with ROA falling to 4.44%. A slight recovery occurred in 2025, with ROA increasing to 4.76%. The decline in ROA, despite increasing assets, suggests that the segment’s profitability has not kept pace with its asset growth, potentially indicating diminishing returns on invested capital or operational inefficiencies. The modest recovery in 2025 may signal a stabilization, but further monitoring is warranted.
The interplay between income before tax and identifiable assets demonstrates a complex relationship within the MedTech segment. While asset investment has been consistent, profitability has fluctuated, impacting the segment’s overall return on assets. The decrease in ROA from 2021 to 2024 warrants further investigation to understand the underlying drivers and potential mitigation strategies.
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Segment Asset Turnover
Johnson & Johnson, asset turnover by reportable segment
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 0.77 | 1.00 | 0.94 | 0.82 | 0.75 |
| MedTech | 0.39 | 0.38 | 0.41 | 0.39 | 0.51 |
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).
Segment asset turnover ratios for the observed period reveal distinct trends within the Innovative Medicine and MedTech segments. The Innovative Medicine segment demonstrates an overall increasing trend initially, followed by a decline in the most recent year. Conversely, the MedTech segment exhibits consistently low ratios with limited fluctuation.
- Innovative Medicine
- The Innovative Medicine segment’s asset turnover ratio increased from 0.75 in 2021 to 0.94 in 2023, indicating improving efficiency in asset utilization to generate revenue. The ratio peaked at 1.00 in 2024 before decreasing to 0.77 in 2025. This recent decline warrants further investigation to determine the underlying causes, which could include increased investment in assets without a corresponding increase in revenue, or a decrease in revenue. The initial increase suggests successful strategies in maximizing revenue generation from existing assets.
- MedTech
- The MedTech segment’s asset turnover ratio remained relatively stable and low throughout the period, ranging between 0.38 and 0.51. The ratio began at 0.51 in 2021, decreased to 0.39 in 2022, and fluctuated between 0.38 and 0.41 for the subsequent years. This consistently low ratio suggests that the MedTech segment is less efficient in utilizing its assets to generate revenue compared to the Innovative Medicine segment. The lack of significant change indicates a persistent operational characteristic, potentially related to the nature of assets employed or the business model within this segment.
- Comparative Analysis
- A significant difference in asset turnover exists between the two segments. The Innovative Medicine segment consistently demonstrates a higher ratio, indicating more effective asset utilization. The gap between the segments widened in 2024, and remained substantial in 2025, despite the decline in Innovative Medicine’s ratio. This disparity suggests differing capital intensity and revenue generation strategies between the two segments.
Further analysis should investigate the drivers behind the decline in the Innovative Medicine segment’s ratio in 2025 and the consistently low ratio in the MedTech segment. Understanding these factors is crucial for optimizing asset allocation and improving overall financial performance.
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Segment Asset Turnover: Innovative Medicine
Johnson & Johnson; Innovative Medicine; segment asset turnover calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Sales to customers | 60,401) | 56,964) | 54,759) | 67,516) | 66,715) |
| Identifiable assets | 78,057) | 57,070) | 58,324) | 82,504) | 89,457) |
| Segment Activity Ratio | |||||
| Segment asset turnover1 | 0.77 | 1.00 | 0.94 | 0.82 | 0.75 |
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).
1 2025 Calculation
Segment asset turnover = Sales to customers ÷ Identifiable assets
= 60,401 ÷ 78,057 = 0.77
The Innovative Medicine segment demonstrated fluctuating asset turnover ratios between 2021 and 2025. Sales to customers experienced initial growth followed by a decline and subsequent recovery, while identifiable assets exhibited a more complex pattern of decrease and increase. These movements impacted the segment’s efficiency in generating sales from its asset base.
- Sales Performance
- Sales to customers increased from US$66,715 million in 2021 to US$67,516 million in 2022, representing a modest growth rate. A significant decrease was then observed in 2023, with sales falling to US$54,759 million. Sales began to recover in 2024, reaching US$56,964 million, and continued this upward trajectory to US$60,401 million in 2025.
- Asset Levels
- Identifiable assets decreased from US$89,457 million in 2021 to US$82,504 million in 2022. This downward trend continued into 2023, with assets declining to US$58,324 million. Assets remained relatively stable in 2024 at US$57,070 million before increasing substantially to US$78,057 million in 2025.
- Segment Asset Turnover
- The segment asset turnover ratio increased from 0.75 in 2021 to 0.82 in 2022, indicating improved efficiency in utilizing assets to generate sales. A further increase to 0.94 in 2023 suggested continued improvement. The ratio peaked at 1.00 in 2024, representing the most efficient asset utilization within the observed period. However, the ratio decreased to 0.77 in 2025, coinciding with a substantial increase in identifiable assets.
The increase in asset turnover from 2021 to 2024 suggests the segment was becoming more effective at converting its investments in assets into revenue. The subsequent decline in 2025, despite continued sales growth, indicates that the increase in assets outpaced the growth in sales, potentially due to investments in long-term projects or acquisitions. Further investigation would be required to determine the nature of these asset increases and their impact on future turnover ratios.
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Segment Asset Turnover: MedTech
Johnson & Johnson; MedTech; segment asset turnover calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Sales to customers | 33,792) | 31,857) | 30,400) | 27,427) | 27,060) |
| Identifiable assets | 86,482) | 84,322) | 74,710) | 70,956) | 53,372) |
| Segment Activity Ratio | |||||
| Segment asset turnover1 | 0.39 | 0.38 | 0.41 | 0.39 | 0.51 |
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).
1 2025 Calculation
Segment asset turnover = Sales to customers ÷ Identifiable assets
= 33,792 ÷ 86,482 = 0.39
Analysis of the MedTech segment reveals fluctuating performance in asset utilization between 2021 and 2025. Sales to customers exhibited a consistent upward trajectory throughout the period, while identifiable assets increased significantly initially, then experienced diminishing growth. Consequently, the segment asset turnover ratio demonstrates a pattern of decline followed by stabilization.
- Sales Performance
- Sales to customers increased from US$27,060 million in 2021 to US$33,792 million in 2025, representing a cumulative growth of approximately 25%. The growth rate appears relatively consistent year-over-year, indicating a steady expansion of the MedTech segment’s revenue generation capabilities.
- Asset Base Evolution
- Identifiable assets grew substantially from US$53,372 million in 2021 to US$70,956 million in 2022, a rise of over 33%. However, the rate of asset accumulation slowed considerably in subsequent years, reaching US$74,710 million in 2023, US$84,322 million in 2024, and US$86,482 million in 2025. This suggests a potential shift in investment strategy or a maturing of asset needs within the segment.
- Segment Asset Turnover
- The segment asset turnover ratio, a measure of how efficiently assets are used to generate sales, decreased from 0.51 in 2021 to 0.39 in 2022. It experienced a slight recovery to 0.41 in 2023, but then declined again to 0.38 in 2024, and remained stable at 0.39 in 2025. This indicates that, despite increasing sales, the segment is becoming less efficient in utilizing its asset base to generate revenue. The initial asset build-up in 2022 appears to have outpaced sales growth, contributing to the initial decline in the ratio. The stabilization in recent years suggests that asset growth and sales are moving at a more balanced pace, but overall efficiency remains below the 2021 level.
In conclusion, while the MedTech segment demonstrates robust sales growth, its asset turnover ratio suggests a need for continued monitoring of asset utilization efficiency. The slower growth in asset accumulation in later years may indicate a strategic response to improve this metric, but further analysis is required to determine the long-term implications.
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Segment Capital Expenditures to Depreciation
Johnson & Johnson, capital expenditures to depreciation by reportable segment
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 0.55 | 0.45 | 0.43 | 0.39 | 0.32 |
| MedTech | 0.72 | 0.75 | 0.81 | 0.92 | 0.85 |
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).
An examination of segment capital expenditures to depreciation reveals differing trends between Innovative Medicine and MedTech. The ratio for Innovative Medicine demonstrates a consistent upward trajectory, while MedTech exhibits a more volatile pattern with an overall decreasing tendency.
- Innovative Medicine
- The capital expenditures to depreciation ratio for Innovative Medicine increased from 0.32 in 2021 to 0.55 in 2025. This indicates a growing investment in capital assets relative to the depreciation expense recognized. The increase suggests a potential expansion of capacity, modernization of facilities, or investment in new technologies within this segment. The rate of increase accelerated between 2023 and 2025, moving from 0.43 to 0.55.
- MedTech
- The capital expenditures to depreciation ratio for MedTech began at 0.85 in 2021, peaked at 0.92 in 2022, and then decreased to 0.72 in 2025. This suggests an initial period of significant capital investment followed by a moderation in investment relative to depreciation. The decline from 2022 onward could be attributed to a completion of major investment projects, increased asset utilization, or a shift in investment strategy. The ratio experienced its largest decrease between 2022 and 2023, falling from 0.92 to 0.81.
The divergence in trends between the two segments suggests differing capital allocation strategies. While Innovative Medicine is consistently increasing its capital investment relative to depreciation, MedTech appears to be stabilizing or reducing this investment. Further investigation would be required to understand the specific drivers behind these differing patterns and their implications for future performance.
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Segment Capital Expenditures to Depreciation: Innovative Medicine
Johnson & Johnson; Innovative Medicine; segment capital expenditures to depreciation calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Additions to property, plant & equipment | 2,076) | 1,710) | 1,653) | 1,697) | 1,529) |
| Depreciation and amortization | 3,772) | 3,760) | 3,847) | 4,345) | 4,788) |
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | 0.55 | 0.45 | 0.43 | 0.39 | 0.32 |
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).
1 2025 Calculation
Segment capital expenditures to depreciation = Additions to property, plant & equipment ÷ Depreciation and amortization
= 2,076 ÷ 3,772 = 0.55
The Innovative Medicine segment demonstrates a consistent increase in the ratio of capital expenditures to depreciation over the five-year period. This suggests a growing investment in property, plant, and equipment relative to the depreciation expense recognized. Additions to property, plant & equipment show an overall upward trend, while depreciation and amortization exhibit a general decline.
- Additions to Property, Plant & Equipment
- Additions to property, plant & equipment increased from US$1,529 million in 2021 to US$1,697 million in 2022. While experiencing a slight decrease to US$1,653 million in 2023, investment rebounded to US$1,710 million in 2024 and further increased significantly to US$2,076 million in 2025. This indicates a sustained and accelerating commitment to capital investment within the segment.
- Depreciation and Amortization
- Depreciation and amortization decreased steadily from US$4,788 million in 2021 to US$3,847 million in 2023. The rate of decline slowed in 2024, with depreciation remaining relatively stable at US$3,760 million, and experienced a marginal increase to US$3,772 million in 2025. This suggests that the asset base subject to depreciation may be aging or that changes in accounting estimates or asset lives are occurring.
- Segment Capital Expenditures to Depreciation
- The segment capital expenditures to depreciation ratio increased from 0.32 in 2021 to 0.39 in 2022, continuing to rise to 0.43 in 2023 and 0.45 in 2024. A more substantial increase is observed in 2025, reaching 0.55. This upward trajectory implies that the segment is investing more in new assets relative to the depreciation of existing assets, potentially signaling future growth or modernization efforts. The increasing ratio could also indicate a shift towards more capital-intensive projects within the Innovative Medicine segment.
The combination of increasing capital expenditures and decreasing depreciation suggests a renewal or expansion of the asset base within the Innovative Medicine segment. Further investigation into the nature of these capital investments and the factors driving the decline in depreciation would provide a more comprehensive understanding of the segment’s financial performance and future outlook.
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Segment Capital Expenditures to Depreciation: MedTech
Johnson & Johnson; MedTech; segment capital expenditures to depreciation calculation
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Additions to property, plant & equipment | 2,501) | 2,443) | 2,372) | 2,120) | 1,933) |
| Depreciation and amortization | 3,490) | 3,237) | 2,943) | 2,302) | 2,286) |
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | 0.72 | 0.75 | 0.81 | 0.92 | 0.85 |
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).
1 2025 Calculation
Segment capital expenditures to depreciation = Additions to property, plant & equipment ÷ Depreciation and amortization
= 2,501 ÷ 3,490 = 0.72
Analysis of segment capital expenditures to depreciation for the MedTech segment reveals a generally decreasing trend over the five-year period. Additions to property, plant & equipment demonstrate consistent growth, while depreciation and amortization experienced a more substantial increase, particularly in recent years, influencing the observed ratio trend.
- Additions to Property, Plant & Equipment
- Additions to property, plant & equipment increased steadily from US$1,933 million in 2021 to US$2,501 million in 2025. This indicates a consistent investment in the segment’s fixed assets over the period. The growth rate appears relatively stable, suggesting a predictable capital investment strategy.
- Depreciation and Amortization
- Depreciation and amortization exhibited a more variable pattern. While initially stable between 2021 and 2022 (US$2,286 million and US$2,302 million respectively), it increased significantly to US$2,943 million in 2023, and continued to rise to US$3,490 million in 2025. This increase likely reflects the depreciation of recent capital investments and potentially changes in the asset base’s composition or useful lives.
- Segment Capital Expenditures to Depreciation
- The segment capital expenditures to depreciation ratio decreased from 0.85 in 2021 to 0.72 in 2025. This decline suggests that depreciation and amortization are growing at a faster rate than capital expenditures. A ratio below 1.0 indicates that the segment’s depreciation expense exceeds its investment in new assets. The most significant decrease occurred between 2022 and 2025, coinciding with the accelerated growth in depreciation and amortization. This trend could indicate a maturing asset base where a larger proportion of assets are being depreciated relative to new investments, or a shift in investment strategy.
The consistent growth in capital expenditures, coupled with the accelerating depreciation expense, warrants further investigation to understand the underlying drivers and potential implications for future segment performance and capital allocation decisions.
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Sales to customers
Johnson & Johnson, sales to customers by reportable segment
US$ in millions
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 60,401) | 56,964) | 54,759) | 67,516) | 66,715) |
| MedTech | 33,792) | 31,857) | 30,400) | 27,427) | 27,060) |
| Segments total | 94,193) | 88,821) | 85,159) | 94,943) | 93,775) |
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).
Overall, the reported segment sales demonstrate varied performance across the analyzed period. While segments total experienced fluctuations, both Innovative Medicine and MedTech exhibited distinct trends. A notable decline in Innovative Medicine sales occurred in 2023, followed by a recovery towards the end of the period, while MedTech consistently increased its sales contribution.
- Innovative Medicine
- Sales for Innovative Medicine remained relatively stable between 2021 and 2022, fluctuating around US$67 billion. A significant decrease was observed in 2023, with sales falling to US$54.759 billion. Subsequently, sales began to recover, reaching US$56.964 billion in 2024 and further increasing to US$60.401 billion in 2025. This suggests potential challenges in 2023, possibly related to patent expirations, increased competition, or shifts in product demand, followed by a successful recovery strategy.
- MedTech
- MedTech sales demonstrated a consistent upward trend throughout the analyzed period. Starting at US$27.060 billion in 2021, sales increased to US$27.427 billion in 2022, US$30.400 billion in 2023, US$31.857 billion in 2024, and culminated in US$33.792 billion in 2025. This consistent growth indicates strong market demand for MedTech products and effective sales execution within this segment.
- Segments Total
- The combined sales of both segments initially increased from US$93.775 billion in 2021 to US$94.943 billion in 2022. A decline was then recorded in 2023, with total sales decreasing to US$85.159 billion, largely influenced by the downturn in Innovative Medicine. The total sales recovered in subsequent years, reaching US$88.821 billion in 2024 and US$94.193 billion in 2025, driven by the growth in MedTech and the recovery of Innovative Medicine. The 2025 total represents a return to levels comparable to those observed in 2021 and 2022.
The differing trajectories of the two segments highlight the importance of diversification. While Innovative Medicine experienced a temporary setback, the consistent performance of MedTech helped to mitigate the overall impact on total segment sales. The recovery observed in Innovative Medicine towards the end of the period is a positive indicator for future performance.
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Income (loss) before tax
Johnson & Johnson, income (loss) before tax by reportable segment
US$ in millions
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 22,266) | 18,919) | 18,246) | 18,831) | 19,475) |
| MedTech | 4,113) | 3,740) | 4,669) | 4,607) | 4,373) |
| Segments total | 26,379) | 22,659) | 22,915) | 23,438) | 23,848) |
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 financial performance of the reportable segments exhibits varied trends over the five-year period. Overall, segment total income before tax demonstrates a fluctuating pattern, with an ultimate increase from 2021 to 2025. However, individual segment performance contributes differently to this overall trend.
- Innovative Medicine
- Income before tax for Innovative Medicine experienced a decline from US$19,475 million in 2021 to US$18,246 million in 2023. A subsequent recovery is observed in 2024, reaching US$18,919 million, followed by a substantial increase to US$22,266 million in 2025. This suggests potential challenges in 2022 and 2023, followed by a strong rebound in later periods.
- MedTech
- MedTech’s income before tax showed initial growth from US$4,373 million in 2021 to US$4,669 million in 2023. However, a notable decrease occurred in 2024, falling to US$3,740 million. A modest recovery is then seen in 2025, with income before tax reaching US$4,113 million. This indicates a period of strength followed by a significant downturn and partial recovery.
- Segments Total
- The combined income before tax for all segments decreased from US$23,848 million in 2021 to US$22,915 million in 2023. A slight decline continued into 2024, reaching US$22,659 million. However, 2025 demonstrates a significant increase, with total segment income before tax rising to US$26,379 million. This final year increase is largely driven by the performance of the Innovative Medicine segment.
The contrasting trends between the two segments highlight differing dynamics within the organization. While Innovative Medicine experienced a recovery and strong growth in the later years, MedTech faced a decline after initial gains. The overall segment total reflects the combined effect of these individual performances, ultimately showing a positive trend in the most recent year.
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Identifiable assets
Johnson & Johnson, identifiable assets by reportable segment
US$ in millions
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 78,057) | 57,070) | 58,324) | 82,504) | 89,457) |
| MedTech | 86,482) | 84,322) | 74,710) | 70,956) | 53,372) |
| Segments total | 164,539) | 141,392) | 133,034) | 153,460) | 142,829) |
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 reported identifiable assets across segments demonstrate fluctuating performance over the five-year period. Total segment assets increased initially, then decreased, before exhibiting growth again in the most recent periods. A detailed examination of each segment reveals distinct patterns.
- Innovative Medicine
- Identifiable assets within Innovative Medicine decreased from US$89,457 million in 2021 to US$82,504 million in 2022, representing a decline of approximately 7.7%. This downward trend continued into 2023, with assets falling to US$58,324 million. A slight decrease was observed in 2024, reaching US$57,070 million. However, a substantial increase is noted in 2025, with assets rising to US$78,057 million. This suggests potential strategic shifts, divestitures, or revaluation of assets within this segment during the earlier years, followed by renewed investment or acquisition activity.
- MedTech
- MedTech assets exhibited a consistent upward trajectory from 2021 to 2025. Beginning at US$53,372 million in 2021, assets increased to US$70,956 million in 2022, a growth of approximately 33.2%. This growth continued in 2023, reaching US$74,710 million, and accelerated further in 2024 to US$84,322 million. The upward trend persisted into 2025, with assets reaching US$86,482 million. This indicates sustained investment and expansion within the MedTech segment.
- Segments Total
- Total identifiable assets across all segments increased from US$142,829 million in 2021 to US$153,460 million in 2022, a rise of approximately 7.4%. A decrease was then observed in 2023, with total assets falling to US$133,034 million. This decline was partially recovered in 2024, with assets reaching US$141,392 million. Finally, a significant increase occurred in 2025, bringing total assets to US$164,539 million. The overall trend suggests a period of initial growth, followed by a contraction, and then a renewed expansion, largely influenced by the performance of the Innovative Medicine and MedTech segments.
The contrasting trends between Innovative Medicine and MedTech suggest differing strategic priorities and investment patterns within the organization. The recent increase in total assets in 2025 is primarily driven by the recovery in Innovative Medicine assets, coupled with the continued growth in MedTech assets.
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Additions to property, plant & equipment
Johnson & Johnson, additions to property, plant & equipment by reportable segment
US$ in millions
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 2,076) | 1,710) | 1,653) | 1,697) | 1,529) |
| MedTech | 2,501) | 2,443) | 2,372) | 2,120) | 1,933) |
| Segments total | 4,577) | 4,153) | 4,025) | 3,817) | 3,462) |
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).
Additions to property, plant, and equipment (PP&E) exhibited an overall increasing trend across the examined period. Analysis at the segment level reveals differing patterns of investment. The combined investment across all segments increased from US$3,462 million in 2021 to US$4,577 million in 2025.
- Innovative Medicine
- Investment in Innovative Medicine PP&E demonstrated volatility. It increased from US$1,529 million in 2021 to US$1,697 million in 2022, then decreased to US$1,653 million in 2023. A subsequent increase was observed in 2024 to US$1,710 million, culminating in a substantial rise to US$2,076 million in 2025. This suggests a potential acceleration of capital expenditure in this segment towards the end of the period.
- MedTech
- MedTech consistently increased its investment in PP&E throughout the period. Starting at US$1,933 million in 2021, investment rose to US$2,120 million in 2022, US$2,372 million in 2023, US$2,443 million in 2024, and finally reached US$2,501 million in 2025. This represents a steady and sustained commitment to capital expenditure within the MedTech segment.
- Segments Total
- The total investment across both segments increased each year from 2021 to 2025. The largest year-over-year increase occurred between 2024 and 2025, with an addition of US$424 million. This indicates a heightened level of capital investment activity in the most recent year examined.
The differing trends between the segments suggest strategic allocation of capital. While MedTech demonstrates consistent investment, Innovative Medicine’s investment pattern indicates potentially project-based or phased capital expenditure. The overall upward trend in total PP&E additions suggests a company-wide commitment to growth and modernization of assets.
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Depreciation and amortization
Johnson & Johnson, depreciation and amortization by reportable segment
US$ in millions
| Dec 28, 2025 | Dec 29, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|---|---|
| Innovative Medicine | 3,772) | 3,760) | 3,847) | 4,345) | 4,788) |
| MedTech | 3,490) | 3,237) | 2,943) | 2,302) | 2,286) |
| Segments total | 7,262) | 6,997) | 6,790) | 6,647) | 7,074) |
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).
Depreciation and amortization expense exhibited varied trends across the reported segments between 2021 and 2025. Overall, segment-level depreciation and amortization initially decreased before showing signs of recovery and eventual growth.
- Innovative Medicine
- The Innovative Medicine segment experienced a consistent decline in depreciation and amortization expense from US$4,788 million in 2021 to US$3,847 million in 2023. This represents a decrease of approximately 19.7% over the three-year period. The decline slowed in 2024, with expense at US$3,760 million, and stabilized in 2025 at US$3,772 million. This suggests a potential slowing of capital investment requiring depreciation within this segment, or an increased salvage value of existing assets.
- MedTech
- In contrast to Innovative Medicine, the MedTech segment demonstrated an increasing trend in depreciation and amortization expense. Starting at US$2,286 million in 2021, expense rose to US$2,943 million in 2023, an increase of approximately 28.7%. This growth continued through 2024, reaching US$3,237 million, and further increased to US$3,490 million in 2025. This indicates ongoing investment in assets within the MedTech segment, potentially driven by product development or expansion of manufacturing capabilities.
- Segments Total
- Total depreciation and amortization across all segments decreased from US$7,074 million in 2021 to US$6,647 million in 2022. A recovery began in 2023, with total expense reaching US$6,790 million, and continued through 2024 (US$6,997 million) and 2025 (US$7,262 million). The overall trend suggests that the growth in MedTech depreciation and amortization is offsetting the decline in the Innovative Medicine segment, leading to a stabilization and eventual increase in total depreciation and amortization expense.
The diverging trends between the two segments suggest differing investment strategies and asset utilization patterns. Further investigation into the nature of these investments and the asset base within each segment would provide a more comprehensive understanding of these trends.
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