GEHCGE HealthCare

The imposition of tariffs, non-tariff barriers, and other import and export restrictions have contributed to increased global economic uncertainty. The rise of economic nationalism could make it more difficult for us to attract new customers, retain existing customers, continue to produce and source in an optimal manner, or maintain sales at existing levels, both in the United States U.S. and in other countries. Geopolitical and economic risks have increased over the past few years in many regions of the world, including in the United States. U.S. Our operations expose us to the risk that increased trade protectionism may adversely affect our business. For example, in late 2024 and early during 2025, the United States, China, and the European Union each announced either U.S. imposed a variety of new tariffs, non-tariff barriers (principally related to participation in public procurement of healthcare equipment), or export controls. Any of these risks, ensuing retaliation, or the further deterioration of trade relations between tariffs on most imports from all countries could make our offerings more expensive or non-competitive in the affected countries. world. This in turn prompted several countries to announce tariffs on U.S. imports. While the situation continues to be fluid, tariffs materially impacted our profitability and cash flows in 2025, primarily the bilateral U.S. and Chinese tariffs and U.S. tariffs on all other global import suppliers. Should the tariffs continue at formally communicated levels, we expect to continue to see a material impact to our financial results through the incurrence of additional costs. Additional tariffs or other trade restrictions by the U.S. or other countries where we do significant business, or other restrictions on specific industries, such as pharmaceuticals, could further materially impact our results in the future. We do not expect that our mitigation actions will fully offset the additional costs or other negative impacts resulting from the tariffs. In addition, current changes and uncertainties in global tariffs are causing volatility in our cost positioning in some international markets. Growing tensions, protectionist trade policies, and tariffs may also lead to a fragmentation of the global economy, operational and logistical shifts in supply chains that may lead to higher costs and longer lead times, a general reduction of international trade in goods and services, and a reduction in the integration of financial markets, any of which could materially and adversely affect our business results, cash flows, financial condition, or prospects.

In November 2023, September 2025, the Financial Accounting Standards Board (“FASB”) FASB issued Accounting Standards Update (“ASU”) ASU No. 2023-07 2025-06 (“ASU 2023-07”), Segment Reporting (Topic 280): 2025-06”), Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to Reportable Segment Disclosures. the Accounting for Internal-Use Software. ASU 2023-07 requires annual 2025-06 updates the accounting for internal-use software by eliminating the concept of development stages. Under the updated guidance, software costs are capitalized once management has authorized and interim disclosures that are expected committed to improve reportable segment disclosures, primarily through enhanced disclosures about significant segment expenses. funding the project, and it is probable the project will be completed and the software will be used to perform the function intended. The provisions of ASU 2023-07 2025-06 are effective for fiscal years annual reporting periods beginning after December 15, 2023, 2027, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company adopted those annual periods. We are currently evaluating the effect that ASU 2023-07 for the year ended December 31, 2024, retrospectively applied to all prior periods presented in the 2025-06 will have on our financial statements. See Note 4, “Segment and Geographical Information” for further information.

We record asset retirement obligations, which primarily relate to nuclear decommissioning, associated with the retirement of tangible long-lived assets as a liability in the period in which the obligation is incurred and its fair value can be reasonably estimated. The liability is measured at the present value of the obligation when incurred and is adjusted in subsequent periods. Corresponding asset retirement costs are generally capitalized as part of the carrying value of the related long-lived assets and depreciated over the assets’ useful lives. Our asset retirement obligations were $409 million and $292 million and $267 million at as of December 31, 2024 2025 and 2023, 2024, respectively, and are recognized within All other current liabilities and All other non-current liabilities in the Consolidated Statements of Financial Position. The increase is primarily driven by $124 million in asset retirement obligations and decommissioning liabilities assumed as part of the NMP acquisition. Refer to Note 8, “Acquisitions, Goodwill, and Other Intangible Assets” for further information.

Additional information on our debt and credit facilities, including definitions of the terms used below, is included in Note 9, “Borrowings.” As part of our capital structure, we have incurred debt. The servicing of this debt is supported by cash flows from our operations. As of December 31, 2024, 2025, we had $8,951 $10,003 million of total debt compared to $9,442 $8,951 million as of December 31, 2023. This includes a $1,000 2024. The increase in debt was due primarily to our issuances in the second quarter of 2025 of $650 million aggregate principal amount of senior unsecured notes issued by the Company due in the third quarter 2031 and $850 million aggregate principal amount of 2024, senior unsecured notes due in 2035, and a repayment in the fourth quarter of 2024 2025 of $1,000 $600 million aggregate principal amount of senior unsecured notes. notes due in 2028 and $650 million aggregate principal amount of senior unsecured notes due in 2035. The decrease in debt was due primarily to issuances were partially offset by repayments of $150 $1,500 million aggregate principal amount outstanding of the senior unsecured notes due in November 2025 in the fourth quarter of 2025 and of $250 million of the outstanding Term Loan Facility in the first and fourth quarter of 2024, respectively. 2025.