UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended	July 28, 2023
☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.<br>For the transition period from __________ to __________

Commission File Number 001-36820

®

Medtronic plc
(Exact name of registrant as specified in its charter)
Ireland	98-1183488
(State of incorporation)	(I.R.S. Employer<br>Identification No.)

20 On Hatch, Lower Hatch Street

Dublin 2, Ireland

(Address of principal executive offices) (Zip Code)

+353 1 438-1700

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:Title of each classTrading SymbolName of each exchange on which registeredOrdinary shares, par value $0.0001 per shareMDTNew York Stock Exchange0.250% Senior Notes due 2025MDT/25New York Stock Exchange0.000% Senior Notes due 2025MDT/25ANew York Stock Exchange2.625% Senior Notes due 2025MDT/25BNew York Stock Exchange1.125% Senior Notes due 2027MDT/27New York Stock Exchange0.375% Senior Notes due 2028MDT/28New York Stock Exchange3.000% Senior Notes due 2028MDT/28ANew York Stock Exchange1.625% Senior Notes due 2031MDT/31New York Stock Exchange1.000% Senior Notes due 2031MDT/31ANew York Stock Exchange3.125% Senior Notes due 2031MDT/31BNew York Stock Exchange0.750% Senior Notes due 2032MDT/32New York Stock Exchange3.375% Senior Notes due 2034MDT/34New York Stock Exchange2.250% Senior Notes due 2039MDT/39ANew York Stock Exchange1.500% Senior Notes due 2039MDT/39BNew York Stock Exchange1.375% Senior Notes due 2040MDT/40ANew York Stock Exchange1.750% Senior Notes due 2049MDT/49New York Stock Exchange1.625% Senior Notes due 2050MDT/50New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☐	Smaller Reporting Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 1(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of August 25, 2023, 1,330,533,713 ordinary shares, par value $0.0001, of the registrant were outstanding.

TABLE OF CONTENTS

Item	Description	Page
	PART I
1.	Financial Statements (unaudited)	1
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
3.	Quantitative and Qualitative Disclosures About Market Risk	47
4.	Controls and Procedures	48
	PART II
1.	Legal Proceedings	48
2.	Unregistered Sales of Equity Securities and Use of Proceeds	48
5.	Other Information	48
6.	Exhibits	49
	Signature	50

Item 1. Financial Statements

Medtronic plc

Consolidated Statements of Income

(Unaudited)

	Three months ended
(in millions, except per share data)	July 28, 2023		July 29, 2022
Net sales	$	7,702	$	7,371
Costs and expenses:
Cost of products sold, excluding amortization of intangible assets	2,628		2,516
Research and development expense	668		692
Selling, general, and administrative expense	2,613		2,567
Amortization of intangible assets	429		423
Restructuring charges, net	54		14
Certain litigation charges	40		—
Other operating expense, net	1		35
Operating profit	1,268		1,125
Other non-operating income, net	(76)		(83)
Interest expense, net	148		164
Income before income taxes	1,196		1,044
Income tax provision	400		112
Net income	797		931
Net income attributable to noncontrolling interests	(6)		(2)
Net income attributable to Medtronic	$	791	$	929
Basic earnings per share	$	0.59	$	0.70
Diluted earnings per share	$	0.59	$	0.70
Basic weighted average shares outstanding	1,330.5		1,329.4
Diluted weighted average shares outstanding	1,333.8		1,334.5

The accompanying notes are an integral part of these consolidated financial statements.

Medtronic plc

Consolidated Statements of Comprehensive Income

(Unaudited)

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Net income	$	797	$	931
Other comprehensive (loss) income, net of tax:
Unrealized loss on investment securities	(19)		(16)
Translation adjustment	14		(884)
Net investment hedge	(143)		1,002
Net change in retirement obligations	3		1
Unrealized (loss) gain on cash flow hedges	(30)		220
Other comprehensive (loss) income	(175)		324
Comprehensive income including noncontrolling interests	622		1,255
Comprehensive income attributable to noncontrolling interests	(6)		—
Comprehensive income attributable to Medtronic	$	616	$	1,255

The accompanying notes are an integral part of these consolidated financial statements.

Medtronic plc

Consolidated Balance Sheets

(Unaudited)

(in millions)	July 28, 2023		April 28, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	1,339	$	1,543
Investments	6,537		6,416
Accounts receivable, less allowances and credit losses of $190 and $176, respectively	5,806		5,998
Inventories, net	5,668		5,293
Other current assets	2,518		2,425
Total current assets	21,869		21,675
Property, plant, and equipment, net	5,665		5,569
Goodwill	41,436		41,425
Other intangible assets, net	14,434		14,844
Tax assets	3,461		3,477
Other assets	3,912		3,959
Total assets	$	90,776	$	90,948
LIABILITIES AND EQUITY
Current liabilities:
Current debt obligations	$	519	$	20
Accounts payable	2,239		2,662
Accrued compensation	1,695		1,949
Accrued income taxes	1,013		840
Other accrued expenses	3,581		3,581
Total current liabilities	9,047		9,051
Long-term debt	24,463		24,344
Accrued compensation and retirement benefits	1,092		1,093
Accrued income taxes	2,407		2,360
Deferred tax liabilities	687		708
Other liabilities	1,715		1,727
Total liabilities	39,410		39,283
Commitments and contingencies (Note 16)
Shareholders’ equity:
Ordinary shares— par value $0.0001, 2.6 billion shares authorized, 1,330,498,304 and 1,330,809,036 shares issued and outstanding, respectively	—		—
Additional paid-in capital	24,587		24,590
Retained earnings	30,265		30,392
Accumulated other comprehensive loss	(3,674)		(3,499)
Total shareholders’ equity	51,178		51,483
Noncontrolling interests	188		182
Total equity	51,366		51,665
Total liabilities and equity	$	90,776	$	90,948

The accompanying notes are an integral part of these consolidated financial statements.

Medtronic plc

Consolidated Statements of Equity

(Unaudited)

	Ordinary Shares			Additional Paid-in Capital		Retained<br>Earnings		Accumulated<br>Other<br>Comprehensive<br>Loss		Total<br> Shareholders’<br> Equity		Noncontrolling Interests		Total Equity
(in millions)	Number	Par Value
April 28, 2023	1,331	$	—	$	24,590	$	30,392	$	(3,499)	$	51,483	$	182	$	51,665
Net income	—	—		—		791		—		791		6		797
Other comprehensive loss	—	—		—		—		(175)		(175)		—		(175)
Dividends to shareholders ($0.69 per ordinary share)	—	—		—		(918)		—		(918)		—		(918)
Issuance of shares under stock purchase and award plans	1	—		73		—		—		73		—		73
Repurchase of ordinary shares	(2)	—		(148)		—		—		(148)		—		(148)
Stock-based compensation	—	—		73		—		—		73		—		73
July 28, 2023	1,330	$	—	$	24,587	$	30,265	$	(3,674)	$	51,178	$	188	$	51,366
	Ordinary Shares			Additional Paid-in Capital		Retained<br>Earnings		Accumulated<br>Other<br>Comprehensive<br>Loss		Total<br> Shareholders’<br> Equity		Noncontrolling Interests		Total Equity
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
(in millions)	Number	Par Value
April 29, 2022	1,331	$	—	$	24,566	$	30,250	$	(2,265)	$	52,551	$	171	$	52,722
Net income	—	—		—		929		—		929		2		931
Other comprehensive income (loss)	—	—		—		—		326		326		(2)		324
Dividends to shareholders ($0.68 per ordinary share)	—	—		—		(903)		—		(903)		—		(903)
Issuance of shares under stock purchase and award plans	2	—		41		—		—		41		—		41
Repurchase of ordinary shares	(3)	—		(333)		—		—		(333)		—		(333)
Stock-based compensation	—	—		62		—		—		62		—		62
July 29, 2022	1,329	$	—	$	24,335	$	30,276	$	(1,939)	$	52,672	$	170	$	52,843

The accompanying notes are an integral part of these consolidated financial statements.

Medtronic plc

Consolidated Statements of Cash Flows

(Unaudited)

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Operating Activities:
Net income	$	797	$	931
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	672		668
Provision for credit losses	21		15
Deferred income taxes	—		(18)
Stock-based compensation	73		62
Loss on debt extinguishment	—		53
Other, net	135		121
Change in operating assets and liabilities, net of acquisitions and divestitures:
Accounts receivable, net	164		89
Inventories, net	(410)		(380)
Accounts payable and accrued liabilities	(673)		(147)
Other operating assets and liabilities	96		(311)
Net cash provided by operating activities	875		1,083
Investing Activities:
Acquisitions, net of cash acquired	—		(1,191)
Additions to property, plant, and equipment	(354)		(426)
Purchases of investments	(1,916)		(1,884)
Sales and maturities of investments	1,748		1,886
Other investing activities, net	(17)		30
Net cash used in investing activities	(539)		(1,585)
Financing Activities:
Change in current debt obligations, net	500		—
Proceeds from short-term borrowings (maturities greater than 90 days)	—		2,284
Payments on long-term debt	—		(2,311)
Dividends to shareholders	(918)		(903)
Issuance of ordinary shares	77		43
Repurchase of ordinary shares	(152)		(336)
Other financing activities	(8)		273
Net cash used in financing activities	(501)		(950)
Effect of exchange rate changes on cash and cash equivalents	(39)		(122)
Net change in cash and cash equivalents	(204)		(1,574)
Cash and cash equivalents at beginning of period	1,543		3,714
Cash and cash equivalents at end of period	$	1,339	$	2,140
Supplemental Cash Flow Information
Cash paid for:
Income taxes	$	117	$	260
Interest	84		68

The accompanying notes are an integral part of these consolidated financial statements.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

1. Basis of Presentation

The accompanying unaudited consolidated financial statements of Medtronic plc and its subsidiaries (Medtronic plc, Medtronic, or the Company) have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S.) (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, the consolidated financial statements include all the adjustments necessary for a fair statement in conformity with U.S. GAAP. Certain reclassifications have been made to prior year financial statements to conform to classifications used in the current year.

Operating results for interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Actual results could materially differ from these estimates.

The accompanying unaudited consolidated financial statements include the accounts of Medtronic plc, its wholly-owned subsidiaries, entities for which the Company has a controlling financial interest, and variable interest entities for which the Company is the primary beneficiary. Intercompany transactions and balances have been eliminated in consolidation. Amounts reported in millions within this quarterly report are computed based on the amounts in thousands, and therefore, the sum of the components may not equal the total amount reported in millions due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding.

The accompanying unaudited consolidated financial statements and related notes should be read in conjunction with the audited consolidated financial statements of the Company and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended April 28, 2023. The Company’s fiscal years 2024, 2023, and 2022 will end or ended on April 26, 2024, April 28, 2023, and April 29, 2022, respectively.

2. New Accounting Pronouncements

Recently Adopted

Supplier Finance Programs

In September 2022, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2022-04, Liabilities— Supplier Finance Programs (Subtopic 405-50), which requires that a buyer in a supplier finance program disclose sufficient information about the program to allow a user of financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. The Company adopted this guidance on April 29, 2023. The adoption of this standard does not have a material impact on the Company’s Consolidated Financial Statements.

As of July 28, 2023, there are no recently issued but not yet adopted accounting pronouncements that are expected to materially impact our consolidated financial statements.

3. Revenue

The Company's revenues are principally derived from device-based medical therapies and services related to cardiac rhythm disorders, cardiovascular disease, neurological disorders and diseases, spinal conditions and musculoskeletal trauma, chronic pain, urological and digestive disorders, ear, nose, and throat conditions, and diabetes conditions as well as advanced and general surgical care products, respiratory and monitoring solutions, and neurological surgery technologies. The Company's primary customers include healthcare systems, clinics, third-party healthcare providers, distributors, and other institutions, including governmental healthcare programs and group purchasing organizations. Prior period revenue has been recast to reflect the new reporting structure, which primarily includes allocating certain prior Medical Surgical businesses to the Other line. Refer to Note 17 to the consolidated financial statements for additional information regarding the Company's new reporting structure.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The table below illustrates net sales by segment and division for the three months ended July 28, 2023 and July 29, 2022:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Cardiac Rhythm & Heart Failure	$	1,446	$	1,381
Structural Heart & Aortic	814		741
Coronary & Peripheral Vascular	589		579
Cardiovascular	2,850		2,701
Cranial & Spinal Technologies	1,103		1,043
Specialty Therapies	695		667
Neuromodulation	420		405
Neuroscience	2,219		2,115
Surgical & Endoscopy	1,546		1,455
Patient Monitoring & Respiratory Interventions	493		479
Medical Surgical	2,039		1,933
Diabetes	578		541
Other(1)	16		81
Total	$	7,702	$	7,371

(1) Includes revenue from the divested Renal Care Solutions business and Transition Manufacturing Agreements from previously divested businesses.

The table below illustrates net sales by market geography for each segment for the three months ended July 28, 2023 and July 29, 2022:

	U.S.(1)				Non-U.S. Developed Markets(2)				Emerging Markets(3)
	Three months ended				Three months ended				Three months ended
(in millions)	July 28, 2023		July 29, 2022		July 28, 2023		July 29, 2022		July 28, 2023		July 29, 2022
Cardiovascular	$	1,350	$	1,286	$	956	$	892	$	544	$	523
Neuroscience	1,497		1,419		416		407		306		290
Medical Surgical	881		831		772		735		386		368
Diabetes	188		206		315		264		75		72
Other(4)	8		25		5		32		3		24
Total	$	3,924	$	3,766	$	2,463	$	2,328	$	1,314	$	1,276

(1)U.S. includes the United States and U.S. territories.

(2)Non-U.S. developed markets include Japan, Australia, New Zealand, Korea, Canada, and the countries within Western Europe.

(3)Emerging markets include the countries of the Middle East, Africa, Latin America, Eastern Europe, and the countries of Asia that are not included in the non-U.S. developed markets, as defined above.

(4)Includes revenue from the divested Renal Care Solutions (RCS) business and Transition Manufacturing Agreements from previously divested businesses.

The amount of revenue recognized is reduced by sales rebates and returns. Adjustments to rebates and returns reserves are recorded as increases or decreases to revenue. At July 28, 2023, $1.1 billion of rebates were classified as other accrued expenses, and $602 million of rebates were classified as a reduction of accounts receivable in the consolidated balance sheet. At April 28, 2023, $1.1 billion of rebates were classified as other accrued expenses, and $555 million of rebates were classified as a reduction of accounts receivable in the consolidated balance sheet.

Deferred Revenue and Remaining Performance Obligations

Deferred revenue at July 28, 2023 and April 28, 2023 was $425 million and $405 million, respectively. At July 28, 2023 and April 28, 2023, $334 million and $314 million was included in other accrued expenses, respectively, and $90 million and $91 million was included in other liabilities, respectively. During the three months ended July 28, 2023, the Company recognized $124 million of revenue that was included in deferred revenue as of April 28, 2023.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

Remaining performance obligations include goods and services that have not yet been delivered or provided under existing, noncancellable contracts with minimum purchase commitments. At July 28, 2023, the estimated revenue expected to be recognized in future periods related to unsatisfied performance obligations for executed contracts with an original duration of one year or more was approximately $0.6 billion. The Company expects to recognize revenue on the majority of these remaining performance obligations over the next three years.

4. Acquisitions and Dispositions

Fiscal Year 2024

The Company had no acquisitions that were accounted for as business combinations during the three months ended July 28, 2023. For the three months ended July 28, 2023, purchase price allocation adjustments were not significant.

Fiscal Year 2023

The Company had acquisitions that were accounted for as business combinations during the three months ended July 29, 2022. The assets and liabilities of the businesses acquired were recorded and consolidated on the acquisition date at their respective fair values. Goodwill resulting from business combinations is largely attributable to future, yet to be defined technologies, new customer relationships, existing workforce of the acquired businesses, and synergies expected to arise after the Company's acquisition of these businesses. The pro forma impact of these acquisitions was not significant, either individually or in the aggregate, to the consolidated results of the Company for the three months ended July 29, 2022. The results of operations of acquired businesses have been included in the Company's consolidated statements of income since the date each business was acquired. For the three months ended July 29, 2022, purchase price allocation adjustments were not significant.

Intersect ENT

On May 13, 2022, the Company acquired Intersect ENT, a global ear, nose, and throat (ENT) medical technology leader which offers a broad suite of solutions to assist surgeons treating patients who suffer from chronic rhinosinusitis (CRS). Total consideration, net of cash acquired, for the transaction, was $1.2 billion consisting of $1.1 billion of cash and $98 million previously held investments in Intersect ENT. The Company acquired $615 million of goodwill, $635 million of technology-based intangible assets, $35 million of customer-related intangible assets, and $13 million of tradenames with estimated useful lives of 20 years. The goodwill is not deductible for tax purposes.

Revenue and net loss attributable to Intersect ENT since the date of acquisition as well as costs incurred in connection with the acquisition included in the consolidated statements of income were not significant for the three months ended July 29, 2022.

The acquisition date fair values of the assets acquired and liabilities assumed were as follows:

(in millions)	Intersect ENT
Cash and cash equivalents	$	39
Inventory	32
Goodwill	615
Other intangible assets	683
Other assets	40
Total assets acquired	1,408
Current liabilities	63
Deferred tax liabilities	51
Other liabilities	18
Total liabilities assumed	131
Net assets acquired	$	1,277

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

Other acquisitions

For acquisitions, other than Intersect ENT, the acquisition date fair value of net assets acquired during the three months ended July 29, 2022, was $123 million. Assets acquired were primarily comprised of $66 million of goodwill and $57 million of technology-based intangible assets, with estimated useful lives of 16 years. The goodwill is deductible for tax purposes. The Company recognized $73 million of non-cash contingent consideration liabilities in connection with these acquisitions, which are comprised of revenue and product development milestone-based payments.

Acquired In-Process Research & Development (IPR&D)

IPR&D with no alternative future use acquired outside of a business combination is expensed immediately. During the three months ended July 28, 2023, the Company did not acquire any IPR&D in connection with asset acquisitions of technology not yet approved. During the three months ended July 29, 2022, IPR&D acquired in connection with asset acquisitions of technology not yet approved by regulators was not significant.

Contingent Consideration

Certain of the Company’s business combinations involve potential payment of future consideration that is contingent upon the achievement of certain product development milestones and/or contingent on the acquired business reaching certain performance milestones. A liability is recorded for the estimated fair value of the contingent consideration on the acquisition date. The fair value of the contingent consideration is remeasured at each reporting period, and the change in fair value is recognized within other operating expense, net in the consolidated statements of income.

The fair value of contingent consideration liabilities at July 28, 2023 and April 28, 2023 was $206 million. At July 28, 2023, $33 million was recorded in other accrued expenses, and $173 million was recorded in other liabilities in the consolidated balance sheet. At April 28, 2023, $34 million was recorded in other accrued expenses, and $171 million was recorded in other liabilities in the consolidated balance sheet.

The following table provides a reconciliation of the beginning and ending balances of contingent consideration liabilities:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Beginning balance	$	206	$	119
Purchase price contingent consideration	—		73
Payments	(3)		—
Change in fair value	3		2
Ending balance	$	206	$	193

The recurring Level 3 fair value measurements of contingent consideration for which a liability is recorded include the following significant unobservable inputs:

	Fair Value at
(in millions)	July 28, 2023	Unobservable Input		Range		Weighted Average (1)
Revenue and other performance-based payments	81	Discount rate		11.2% - 27.2%		17.3%
			2024 - 2027		2025
Product development and other milestone-based payments	125	Discount rate		3.9% - 5.5%		4.1%
			2024 - 2027		2026

All values are in US Dollars.

(1) Unobservable inputs were weighted by the relative fair value of the contingent consideration liability. For projected fiscal year of payment, the amount represents the median of the inputs and is not a weighted average.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

On April 1, 2023, the Company and DaVita Inc. (“DaVita”) completed the transaction for the Company to sell half of its Renal Care Solutions (RCS) business. In connection with the sale, the Company may be entitled to receive additional consideration based on the achievement of certain revenue, regulatory, and profitability milestones, with potential payouts starting in fiscal year 2025 through 2029. The fair value of the contingent consideration receivable at July 28, 2023 and April 28, 2023 was $152 million and $195 million, respectively, and was recorded in other assets in the consolidated balance sheet.

The following table provides a reconciliation of the beginning and ending balances of the Level 3 measurement of contingent consideration receivable:

(in millions)	July 28, 2023
Beginning balance	$	195
Change in fair value	(43)
Ending balance	$	152

Renal Care Solutions disposition

This sale is part of an agreement between Medtronic and DaVita to form a new, independent kidney care-focused medical device company (“Mozarc Medical” or "Mozarc") with equal equity ownership. RCS was part of the Company’s Medical Surgical portfolio. At closing, the Company received $45 million cash consideration, recorded non-cash contingent consideration receivables valued at $195 million, made an additional cash investment of $224 million, and retained a 50% non-controlling equity interest in Mozarc valued at $307 million. For the contingent consideration receivables, the maximum consideration the Company could receive in the future is $300 million based on the achievement of the aforementioned milestones. The Company recorded a non-cash pre-tax impairment of $67 million in the three months ended July 29, 2022, primarily related to goodwill, recognized in other operating expense, net in the consolidated statements of income. Refer to Note 10 to the consolidated financial statements for additional information on the goodwill impairment. Refer to Note 6 to the consolidated financial statements for additional information on the Company’s retained 50% equity investment in Mozarc as a result of this transaction.

The Company determined that the sale of the RCS business did not meet the criteria to be classified as discontinued operations.

5. Restructuring and Other Costs

For the three months ended July 28, 2023, the Company incurred $91 million of restructuring and associated costs related to employee termination benefits and facility consolidations to support cost reduction initiatives. For the three months ended July 29, 2022, restructuring charges primarily related to the Enterprise Excellence and Simplification restructuring programs, both of which were substantially completed as of the end of fiscal year 2023. Enterprise Excellence was designed to leverage the Company’s global size and scale to focus on global operations, and functional and commercial optimization, and had total pre-tax charges of $1.8 billion. Simplification was designed to focus the organization on accelerating innovation, enhancing customer experience, driving revenue growth and winning market share, and had total pre-tax charges of $0.5 billion.

Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated and voluntary early retirement benefits. Associated costs primarily include salaries and wages of employees that are fully-dedicated to restructuring programs and consulting expenses.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The following table presents the classification of restructuring and associated costs in the consolidated statements of income:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Cost of products sold	$	16	$	20
Selling, general, and administrative expenses	21		41
Restructuring charges, net	54		14
Total restructuring and associated costs	$	91	$	76

The following table summarizes the activity related to restructuring programs for the three months ended July 28, 2023:

(in millions)	Employee Termination Benefits		Associated Costs		Other <br>Costs		Total
April 28, 2023	$	204	$	23	$	1	$	230
Charges	55		37		—		92
Cash payments	(147)		(53)		—		(201)
Accrual adjustments(1)	(2)		—		—		(2)
July 28, 2023	$	110	$	7	$	1	$	119

(1)Accrual adjustments primarily relate to certain employees identified for termination, finding other positions within the Company.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

6. Financial Instruments

Debt Securities

The Company holds investments in marketable debt securities that are classified and accounted for as available-for-sale and are remeasured on a recurring basis. The following tables summarize the Company's investments in available-for-sale debt securities by significant investment category and the related consolidated balance sheet classification at July 28, 2023 and April 28, 2023:

	July 28, 2023
	Valuation								Balance Sheet Classification
(in millions)	Cost		Unrealized<br>Gains		Unrealized<br>Losses		Fair Value		Investments		Other Assets
Level 1:
U.S. government and agency securities	$	549	$	—	$	(28)	$	521	$	521	$	—
Level 2:
Corporate debt securities	4,219		5		(171)		4,053		4,053		—
U.S. government and agency securities	897		—		(52)		845		845		—
Mortgage-backed securities	574		—		(56)		518		518		—
Non-U.S. government and agency securities	14		—		—		14		14		—
Other asset-backed securities	601		—		(16)		585		585		—
Total Level 2	6,305		5		(295)		6,015		6,015		—
Level 3:
Auction rate securities	36		—		(3)		33		—		33
Total available-for-sale debt securities	$	6,890	$	5	$	(326)	$	6,570	$	6,537	$	33
	April 28, 2023
---	---	---	---	---	---	---	---	---	---	---	---	---
	Valuation								Balance Sheet Classification
(in millions)	Cost		Unrealized<br>Gains		Unrealized<br>Losses		Fair Value		Investments		Other Assets
Level 1:
U.S. government and agency securities	$	527	$	—	$	(22)	$	505	$	505	$	—
Level 2:
Corporate debt securities	4,140		6		(162)		3,984		3,984		—
U.S. government and agency securities	879		—		(45)		834		834		—
Mortgage-backed securities	560		—		(54)		506		506		—
Non-U.S. government and agency securities	15		—		—		15		15		—
Certificates of deposit	10		—		—		10		10		—
Other asset-backed securities	580		—		(19)		561		561		—
Total Level 2	6,185		6		(281)		5,911		5,911		—
Level 3:
Auction rate securities	36		—		(3)		33		—		33
Total available-for-sale debt securities	$	6,748	$	6	$	(305)	$	6,449	$	6,416	$	33

The amortized cost of debt securities excludes accrued interest, which is reported in other current assets in the consolidated balance sheets.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The following tables present the gross unrealized losses and fair values of the Company’s available-for-sale debt securities that have been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category at July 28, 2023 and April 28, 2023:

	July 28, 2023
	Less than 12 months				More than 12 months
(in millions)	Fair Value		Unrealized<br>Losses		Fair Value		Unrealized<br>Losses
Corporate debt securities	$	376	$	(6)	$	2,896	$	(165)
U.S. government and agency securities	86		(2)		860		(78)
Mortgage-backed securities	26		(1)		463		(55)
Other asset-backed securities	—		—		534		(16)
Auction rate securities	—		—		33		(3)
Total	$	488	$	(9)	$	4,786	$	(317)
	April 28, 2023
---	---	---	---	---	---	---	---	---
	Less than 12 months				More than 12 months
(in millions)	Fair Value		Unrealized<br>Losses		Fair Value		Unrealized<br>Losses
Corporate debt securities	$	286	$	(4)	$	2,901	$	(158)
U.S. government and agency securities	89		(3)		821		(64)
Mortgage-backed securities	26		(1)		460		(53)
Other asset-backed securities	—		—		545		(19)
Auction rate securities	—		—		33		(3)
Total	$	401	$	(8)	$	4,760	$	(297)

The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. There were no transfers into or out of Level 3 during the three months ended July 28, 2023 and July 29, 2022. When a determination is made to classify an asset or liability within Level 3, the determination is based upon the significance of the unobservable inputs to the overall fair value measurement.

Activity related to the Company’s available-for-sale debt securities portfolio is as follows:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Proceeds from sales	$	1,747	$	1,864
Gross realized gains	5		1
Gross realized losses	(12)		(9)

The July 28, 2023 balance of available-for-sale debt securities by contractual maturity is shown in the following table. Within the table, maturities of mortgage-backed securities have been allocated based upon timing of estimated cash flows assuming no change in the current interest rate environment. Actual maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties.

(in millions)	July 28, 2023
Due in one year or less	$	1,339
Due after one year through five years	3,799
Due after five years through ten years	761
Due after ten years	672
Total	$	6,570

Interest income is recognized in other non-operating income, net, in the consolidated statements of income. During the three months ended July 28, 2023 and July 29, 2022, there was $111 million and $55 million of interest income, respectively.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

Equity Securities, Equity Method Investments, and Other Investments

The Company holds investments in equity securities with readily determinable fair values, equity method investments for which the Company has elected the fair value option, equity investments without readily determinable fair values, investments accounted for under the equity method, and other investments. Equity securities with readily determinable fair values are included in Level 1 of the fair value hierarchy, as they are measured using quoted market prices. Equity method investments for which the Company has elected the fair value option are included within Level 3 of the fair value hierarchy due to the use of significant unobservable inputs to determine fair value. To determine the fair value of these investments, the Company uses a discounted cash flow methodology, taking into consideration various assumptions including discount rate, and all pertinent financial information available related to the investees, including historical financial statements and projected future cash flows. Equity investments that do not have readily determinable fair values, and that are not accounted for via the fair value option, are included within Level 3 of the fair value hierarchy, as they are measured using the measurement alternative at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

The following table summarizes the Company's equity and other investments at July 28, 2023 and April 28, 2023, which are classified as other assets in the consolidated balance sheets:

(in millions)	July 28, 2023		April 28, 2023
Investments with readily determinable fair value (marketable equity securities)	$	51	$	115
Investments for which the fair value option has been elected	531		531
Investments without readily determinable fair values	899		872
Equity method and other investments	88		89
Total equity and other investments	$	1,569	$	1,607

Gains and losses on the Company's portfolio of equity and other investments are recognized in other non-operating income, net in the consolidated statements of income. During the three months ended July 28, 2023, there were $64 million of net unrealized losses on equity securities and other investments still held at July 28, 2023. During the three months ended July 29, 2022, there were $8 million of net unrealized gains on equity securities and other investments still held at July 29, 2022.

Mozarc Medical Investment

On April 1, 2023, the Company sold half of its RCS business to Mozarc, and as a result of the transaction the Company retained a 50% equity interest in Mozarc. Refer to Note 4 for additional information on this transaction. Although the equity investment provides the Company with the ability to exercise significant influence over Mozarc, the Company has elected the fair value option to account for this equity investment. The Company believes the fair value option best reflects the economics of the underlying transaction.

Under the fair value option, changes in the fair value of the investment are recognized through earnings each reporting period in other non-operating income, net in the consolidated statements of income. During the three months ended July 28, 2023, the change in fair value was insignificant.

7. Financing Arrangements

Commercial Paper

The Company maintains commercial paper programs that allow the Company to issue U.S. dollar or Euro-denominated unsecured commercial paper notes. The aggregate amount outstanding at any time under the commercial paper programs may not exceed the equivalent of $3.5 billion. Commercial paper outstanding at July 28, 2023 was $500 million. During the three months ended July 28, 2023, the commercial paper outstanding had a weighted average original maturity of 14 days and a weighted average interest rate of 5.262 percent. No commercial paper was outstanding at April 28, 2023. The issuance of commercial paper reduces the amount of credit available under the Company’s existing Credit Facility, as defined below.

Line of Credit

The Company has a $3.5 billion five-year unsecured revolving credit facility (Credit Facility), which provides back-up funding for the commercial paper programs described above. The Credit Facility includes a multi-currency borrowing feature for certain specified foreign currencies. At July 28, 2023 and April 28, 2023, no amounts were outstanding under the Credit Facility.

Interest rates on advances on the Credit Facility are determined by a pricing matrix, based on the Company’s long-term debt ratings, assigned by Standard & Poor’s Ratings Services and Moody’s Investors Service. Facility fees are payable on the Credit Facility and are determined in the same manner as the interest rates. The Company is in compliance with the covenants under the Credit Facility.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

Debt Obligations

The Company's debt obligations consisted of the following:

(in millions)	Maturity by <br>Fiscal Year	July 28, 2023		April 28, 2023
Current debt obligations	2024 - 2025	$	519	$	20
Long-term debt
0.250 percent six-year 2019 senior notes	2026	1,105		1,097
2.625 percent three-year 2022 senior notes	2026	552		549
0.000 percent five-year 2020 senior notes	2026	1,105		1,097
1.125 percent eight-year 2019 senior notes	2027	1,657		1,646
4.250 percent five-year 2023 senior notes	2028	1,000		1,000
3.000 percent six-year 2022 senior notes	2029	1,105		1,097
0.375 percent eight-year 2020 senior notes	2029	1,105		1,097
1.625 percent twelve-year 2019 senior notes	2031	1,105		1,097
1.000 percent twelve-year 2019 senior notes	2032	1,105		1,097
3.125 percent nine-year 2022 senior notes	2032	1,105		1,097
0.750 percent twelve-year 2020 senior notes	2033	1,105		1,097
4.500 percent ten-year 2023 senior notes	2033	1,000		1,000
3.375 percent twelve-year 2022 senior notes	2035	1,105		1,097
4.375 percent twenty-year 2015 senior notes	2035	1,932		1,932
6.550 percent thirty-year 2007 CIFSA senior notes	2038	253		253
2.250 percent twenty-year 2019 senior notes	2039	1,105		1,097
6.500 percent thirty-year 2009 senior notes	2039	158		158
1.500 percent twenty-year 2019 senior notes	2040	1,105		1,097
5.550 percent thirty-year 2010 senior notes	2040	224		224
1.375 percent twenty-year 2020 senior notes	2041	1,105		1,097
4.500 percent thirty-year 2012 senior notes	2042	105		105
4.000 percent thirty-year 2013 senior notes	2043	305		305
4.625 percent thirty-year 2014 senior notes	2044	127		127
4.625 percent thirty-year 2015 senior notes	2045	1,813		1,813
1.750 percent thirty-year 2019 senior notes	2050	1,105		1,097
1.625 percent thirty-year 2020 senior notes	2051	1,105		1,097
Finance lease obligations	2024 - 2036	57		57
Deferred financing costs	2026 - 2051	(120)		(124)
Debt discount, net	2026 - 2051	(65)		(64)
Total long-term debt		$	24,463	$	24,344

Senior Notes

The Company has outstanding unsecured senior obligations, described as senior notes in the tables above (collectively, the Senior Notes). The Senior Notes rank equally with all other unsecured and unsubordinated indebtedness of the Company. The Company is in compliance with all covenants related to the Senior Notes.

In September 2022, Medtronic Luxco issued four tranches of Euro-denominated Senior Notes with an aggregate principal of €3.5 billion, with maturities ranging from fiscal year 2026 to 2035, resulting in cash proceeds of approximately $3.4 billion, net of discounts and issuance costs. The Company used the net proceeds to repay at maturity €750 million of Medtronic Luxco Senior Notes for $772 million of total consideration in December 2022 and €2.8 billion of Medtronic Luxco Senior Notes for $2.9 billion of total consideration in March 2023.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

In March 2023, Medtronic Luxco issued two tranches of USD-denominated Senior Notes with an aggregate principal of $2.0 billion, with maturities ranging from fiscal year 2028 to 2033, resulting in cash proceeds of approximately $2.0 billion, net of discounts and issuance costs. The Company used the net proceeds supplemented by additional cash to repay the ¥297 billion Fiscal 2023 Loan Agreement discussed below for $2.3 billion of total consideration.

The Euro-denominated debt issued in September 2022 is designated as a net investment hedge of certain of the Company's European operations. Refer to Note 8 for additional information regarding the net investment hedge.

Term Loan Agreements

In May 2022, Medtronic Luxco entered into a term loan agreement (Fiscal 2023 Loan Agreement) by and among Medtronic Luxco, Medtronic plc, Medtronic, Inc., and Mizuho Bank, Ltd. as administrative agent and as lender. The Fiscal 2023 Loan Agreement provides an unsecured term loan in an aggregate principal amount of up to ¥300 billion with a term of 364 days. Borrowings under the Fiscal 2023 Loan Agreement bear interest at the TIBOR Rate (as defined in the Fiscal 2023 Loan Agreement) plus a margin of 0.40% per annum. Medtronic plc and Medtronic, Inc. have guaranteed the obligations of Medtronic Luxco under the Fiscal 2023 Loan Agreement. In May and June 2022, Medtronic Luxco borrowed an aggregate of ¥297 billion, or approximately $2.3 billion, of the term loan, under the Fiscal 2023 Loan Agreement. The Company used the net proceeds of the borrowings to fund the early redemption of $1.9 billion of Medtronic Inc.'s 3.500% Senior Notes due 2025 for $1.9 billion of total consideration, and $368 million of Medtronic Luxco's 3.350% Senior Notes due 2027 for $376 million of total consideration. The Company recognized a total loss on debt extinguishment of $53 million in the three months ended July 29, 2022, which primarily includes cash premiums and accelerated amortization of deferred financing costs and debt discounts and premiums. The loss was recognized in interest expense, net in the consolidated statements of income. During the fourth quarter of fiscal year 2023, the Company repaid the term loan in full, including interest.

Financial Instruments Not Measured at Fair Value

At July 28, 2023, the estimated fair value of the Company’s Senior Notes was $21.4 billion compared to a principal value of $24.6 billion. At April 28, 2023, the estimated fair value was $21.7 billion compared to a principal value of $24.5 billion. The fair value was estimated using quoted market prices for the publicly registered Senior Notes, which are classified as Level 2 within the fair value hierarchy. The fair values and principal values consider the terms of the related debt and exclude the impacts of debt discounts and hedging activity.

8. Derivatives and Currency Exchange Risk Management

The Company uses derivative instruments and foreign currency denominated debt to manage the impact that currency exchange rate and interest rate changes have on reported financial statements. The Company does not enter into derivative contracts for speculative purposes.

Cash Flow Hedges

The Company uses foreign currency forward and option contracts designated as cash flow hedges to manage its exposure to the variability of future cash flows that are denominated in a foreign currency.

At inception, foreign currency forward and option contracts are designated as cash flow hedges. Changes in the fair value of these derivatives are reported as a component of accumulated other comprehensive loss until the hedged transaction affects earnings. When the hedged transaction affects earnings, the gain or loss on the derivative is reclassified to earnings. Amounts excluded from the measurement of hedge effectiveness are recognized in earnings on a straight-line basis over the term of the hedge. Cash flows are reported as operating activities in the consolidated statements of cash flows.

The Company's cash flow hedges will mature within the subsequent three-year period. At July 28, 2023 and April 28, 2023, the Company had $63 million and $93 million in after-tax unrealized gains, respectively, associated with cash flow hedging instruments recorded in accumulated other comprehensive loss. The Company expects that $122 million of after-tax net unrealized gains at July 28, 2023 will be recognized in the consolidated statements of income over the next 12 months.

Net Investment Hedges

The Company uses derivative instruments and foreign currency denominated debt to manage foreign currency risk associated with its net investment in foreign operations. The derivative instruments that the Company uses for this purpose may include foreign currency forward exchange contracts used on a standalone basis or in combination with option collars and standalone cross currency interest rate contracts.

For instruments that are designated as net investment hedges, the gains or losses are reported as a component of accumulated other comprehensive loss. The gains or losses are reclassified into earnings upon a liquidation event or deconsolidation of the foreign subsidiary. Amounts excluded from the assessment of effectiveness are recognized in interest expense, net on a straight-line basis over the term of the hedge. During the three months ended July 28, 2023 and July 29, 2022, the Company recognized $49 million and $21 million, respectively, in after-tax gains representing excluded components in interest expense, net. The cash flows related to the Company's derivative instruments

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

designated as net investment hedges are reported as investing activities in the consolidated statements of cash flows. Cash flows attributable to amounts excluded from the assessment of effectiveness are reported as operating activities in the consolidated statements of cash flows.

Undesignated Derivatives

The Company uses foreign currency forward exchange contracts to offset the Company’s exposure to the change in the value of non-functional currency denominated assets, liabilities, and cash flows.

These foreign currency forward exchange rate contracts are not designated as hedges at inception, and therefore, changes in the fair value of these contracts are recognized in the consolidated statements of income. Cash flows related to the Company’s undesignated derivative contracts are reported in the consolidated statements of cash flows based on the nature of the derivative instrument.

Outstanding Instruments

The following table presents the contractual amounts of the Company's outstanding instruments:

		As of
(in billions)	Designation	July 28, 2023		April 28, 2023
Currency exchange rate contracts	Cash flow hedge	$	10.0	$	9.1
Currency exchange rate contracts(1)	Net investment hedge	7.3		7.2
Foreign currency-denominated debt(2)	Net investment hedge	17.7		17.6
Currency exchange rate contracts	Undesignated	5.7		5.8

(1)At July 28, 2023, includes derivative contracts with a notional value of €4.5 billion, or $5.0 billion, designated as hedges of a portion of our net investment in certain European operations and derivative contracts with a notional value of ¥322.2 billion, or $2.3 billion, designated as hedges of a portion of our net investment in certain Japanese operations. These derivative contracts mature in fiscal years 2024 through 2033.

(2)At July 28, 2023, includes €16.0 billion, or $17.7 billion, of outstanding Euro-denominated debt as hedges of a portion our net investment in foreign operations. This debt matures in fiscal years 2026 through 2051.

Gains and Losses on Hedging Instruments and Derivatives not Designated as Hedging Instruments

The amount of the gains and losses on our hedging instruments and the classification of those gains and losses within our consolidated financial statements for the three months ended July 28, 2023 and July 29, 2022 were as follows:

	(Gain) Loss Recognized in Accumulated Other Comprehensive Loss				(Gain) Loss Reclassified into Income
	Three months ended					Three months ended					Location of (Gain) Loss in Income Statement
(in millions)	July 28, 2023		July 29, 2022				July 28, 2023		July 29, 2022
Cash flow hedges
Currency exchange rate contracts	$	(4)	$	(342)			$	(51)	$	(137)		Other operating expense, net
Currency exchange rate contracts	(33)		(34)				(5)		18			Cost of products sold
Net investment hedges
Foreign currency-denominated debt	114		(945)				—		—			N/A
Currency exchange rate contracts	30		(57)				—		—			N/A
Total	$	106	$	(1,378)			$	(56)	$	(120)

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The amount of the gains and losses on our derivative instruments not designated as hedging instruments and the classification of those gains and losses within our consolidated financial statements during the three months ended July 28, 2023 and July 29, 2022 were as follows:

	(Gain) Loss Recognized in Income
	Three months ended				Location of (Gain) Loss in Income Statement
(in millions)	July 28, 2023		July 29, 2022
Derivatives not designated as hedging instruments
Currency exchange rate contracts	$	(2)	$	26		Other operating expense, net
Total return swaps	(19)		(1)			Other operating expense, net
Total	$	(21)	$	25

Balance Sheet Presentation

The following tables summarize the balance sheet classification and fair value of derivative instruments included in the consolidated balance sheets at July 28, 2023 and April 28, 2023. The fair value amounts are presented on a gross basis, and are segregated between derivatives that are designated and qualify as hedging instruments and those that are not designated and do not qualify as hedging instruments, and are further segregated by type of contract within those two categories.

	Fair Value - Assets					Fair Value - Liabilities
(in millions)	July 28, 2023		April 28, 2023		Balance Sheet Classification	July 28, 2023		April 28, 2023		Balance Sheet Classification
Derivatives designated as hedging instruments
Currency exchange rate contracts	$	300	$	318	Other current assets	$	136	$	109	Other accrued expenses
Currency exchange rate contracts	53		33		Other assets	121		117		Other liabilities
Total derivatives designated as hedging instruments	353		351			258		226
Derivatives not designated as hedging instruments
Currency exchange rate contracts	45		17		Other current assets	48		10		Other accrued expenses
Total return swaps	24		—		Other current assets	—		—		Other accrued expenses
Total derivatives not designated as hedging instruments	68		17			48		10
Total derivatives	$	421	$	368		$	306	$	236

The following table provides information by level for the derivative assets and liabilities that are measured at fair value on a recurring basis.

	July 28, 2023				April 28, 2023
(in millions)	Derivative Assets		Derivative Liabilities			Derivative Assets		Derivative Liabilities
Level 1	$	398	$	306		$	368	$	236
Level 2	24		—			—		—
Total	$	421	$	306		$	368	$	236

The Company has elected to present the fair value of derivative assets and liabilities within the consolidated balance sheets on a gross basis, even when derivative transactions are subject to master netting arrangements and may otherwise qualify for net presentation. The cash flows related to collateral posted and received are reported gross as investing and financing activities, respectively, in the consolidated statements of cash flows.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The following tables provide information as if the Company had elected to offset the asset and liability balances of derivative instruments, netted in accordance with various criteria as stipulated by the terms of the master netting arrangements with each of the counterparties. Derivatives not subject to master netting arrangements are not eligible for net presentation.

	July 28, 2023
			Gross Amount Not Offset on the Balance Sheet
(in millions)	Gross Amount of Recognized Assets (Liabilities)		Financial Instruments		Cash Collateral (Received) Posted		Net Amount
Derivative assets:
Currency exchange rate contracts	$	398	$	(223)	$	(6)	$	168
Total return swaps	24		—		—		24
	421		(223)		(6)		192
Derivative liabilities:
Currency exchange rate contracts	(306)		223		1		(82)
Total	$	115	$	—	$	(5)	$	110			April 28, 2023
---	---	---	---	---	---	---	---	---
			Gross Amount Not Offset on the Balance Sheet
(in millions)	Gross Amount of Recognized Assets (Liabilities)		Financial Instruments		Cash Collateral (Received) Posted		Net Amount
Derivative assets:
Currency exchange rate contracts	$	368	$	(189)	$	(11)	$	168
Derivative liabilities:
Currency exchange rate contracts	(236)		189		—		(48)
Total	$	132	$	—	$	(11)	$	121

9. Inventories

Inventory balances, net of reserves, were as follows:

(in millions)	July 28, 2023		April 28, 2023
Finished goods	$	3,723	$	3,440
Work-in-process	816		789
Raw materials	1,130		1,063
Total	$	5,668	$	5,293

10. Goodwill and Other Intangible Assets

Goodwill

The following table presents the changes in the carrying amount of goodwill by segment:

(in millions)	Cardiovascular		Medical Surgical		Neuroscience		Diabetes		Total
April 28, 2023	$	7,873	$	19,579	$	11,718	$	2,255	$	41,425
Purchase accounting adjustments	(6)		—		—		—		(6)
Currency translation and other	13		11		(7)		—		17
July 28, 2023	$	7,880	$	19,590	$	11,711	$	2,255	$	41,436

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

As further described in Note 17, the Company has certain new operating segments as of the beginning of fiscal year 2024. Each new operating segment is considered a standalone reporting unit as of the beginning of fiscal year 2024. As a result of the change, the Company allocated all goodwill that was previously assigned to the Medical Surgical reporting unit to the new reporting units using a relative fair value allocation approach. Reporting units were tested for impairment before and after the alignment. No goodwill impairment was identified in either test; however, the Patient Monitoring & Respiratory Interventions reporting unit had an estimated fair value that exceeded its carrying value by less than 10 percent. As of July 28, 2023, $3.0 billion of goodwill was allocated to the Patient Monitoring & Respiratory Interventions reporting unit.

The goodwill allocation and the tests for impairment of goodwill require the Company to make several estimates related to projected future cash flows to determine the fair value of the goodwill reporting units. The Company calculates the excess of each reporting unit's fair value over its carrying amount, including goodwill, utilizing a discounted cash flow analysis. The test for goodwill is based on future cash flows that require significant judgment with respect to future revenue and expense growth rates and discount rates. The discount rate applied to the cash flow analysis is based on the weighted average cost of capital (“WACC”) for each reporting unit. An impairment loss is recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit. A change in any of these estimates and assumptions could produce a different fair value, which could have a material impact on the Company's results of operations.

As a result of the agreement with DaVita, as disclosed in Note 4 to the consolidated financial statements, the Company allocated $208 million of goodwill to the RCS business that met the criteria to be classified as held for sale during the first quarter of fiscal year 2023 and was subsequently sold on April 1, 2023. Upon allocation, a goodwill impairment test was performed for the RCS business, and the Company recognized $61 million of goodwill impairment during the three months ended July 29, 2022. The goodwill impairment charges are recognized in other operating expense, net in the consolidated statements of income.

Intangible Assets

The following table presents the gross carrying amount and accumulated amortization of intangible assets:

	July 28, 2023				April 28, 2023
(in millions)	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Definite-lived:
Customer-related	$	16,956	$	(8,221)	$	16,956	$	(7,979)
Purchased technology and patents	11,664		(6,451)		11,659		(6,277)
Trademarks and tradenames	485		(282)		486		(280)
Other	124		(73)		116		(69)
Total	$	29,229	$	(15,027)	$	29,217	$	(14,605)
Indefinite-lived:
IPR&D	$	232	$	—	$	232	$	—

The Company did not recognize any definite-lived or indefinite-lived intangible asset charges during the three months ended July 28, 2023 and July 29, 2022. Due to the nature of IPR&D projects, the Company may experience future delays or failures to obtain regulatory approvals to conduct clinical trials, failures of clinical trials, delays or failures to obtain required market clearances, other failures to achieve a commercially viable product, or the discontinuation of certain projects, and as a result, may recognize impairment losses in the future.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

Amortization Expense

Intangible asset amortization expense for the three months ended July 28, 2023 and July 29, 2022 was $429 million and $423 million, respectively. Estimated aggregate amortization expense by fiscal year based on the carrying value of definite-lived intangible assets at July 28, 2023, excluding any possible future amortization associated with acquired IPR&D which has not yet met technological feasibility, is as follows:

(in millions)	Amortization Expense
Remaining 2024	$	1,256
2025	1,654
2026	1,642
2027	1,619
2028	1,568
2029	1,489

11. Income Taxes

The Israeli Central-Lod District Court issued its decision in Medtronic Ventor Technologies Ltd (Ventor) v. Kfar Saba Assessing Office on June 1, 2023. The court determined that there was a deemed taxable transfer of intellectual property. As a result, the Company has recorded a $187 million income tax charge during the three months ended July 28, 2023. At this time, the Company is evaluating whether or not it will appeal the decision.

The Company's effective tax rate for the three months ended July 28, 2023 was 33.4%, as compared to 10.7% for the three months ended July 29, 2022. The increase in our effective tax rate primarily relates to an income tax reserve adjustment associated with the Ventor court decision discussed above, an increase in Puerto Rico withholding tax rates, and the benefit from the release of a valuation allowance during the three months ended July 29, 2022.

At July 28, 2023 and April 28, 2023, the Company's gross unrecognized tax benefits were $2.8 billion and $2.7 billion, respectively. In addition, the Company had accrued gross interest and penalties of $154 million at July 28, 2023. If all of the Company’s unrecognized tax benefits were recognized, approximately $2.6 billion would impact the Company’s effective tax rate. At both July 28, 2023 and April 28, 2023, the amount of the Company's gross unrecognized tax benefits, net of cash advance, recorded as a noncurrent liability within accrued income taxes on the consolidated balance sheets was $1.8 billion. The Company recognizes interest and penalties related to income tax matters within income tax provision in the consolidated statements of income and records the liability within either current or noncurrent accrued income taxes on the consolidated balance sheets.

Refer to Note 16 to the consolidated financial statements for additional information regarding the status of current tax audits and proceedings.

12. Earnings Per Share

Basic earnings per share is computed based on the weighted average number of ordinary shares outstanding. Diluted earnings per share is computed based on the weighted number of ordinary shares outstanding, increased by the number of additional shares that would have been outstanding had the potentially dilutive ordinary shares been issued, and reduced by the number of shares the Company could have repurchased with the proceeds from issuance of the potentially dilutive shares. Potentially dilutive ordinary shares include stock-based awards granted under stock-based compensation plans and shares committed to be purchased under the employee stock purchase plan.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The table below sets forth the computation of basic and diluted earnings per share:

	Three months ended
(in millions, except per share data)	July 28, 2023		July 29, 2022
Numerator:
Net income attributable to ordinary shareholders	$	791	$	929
Denominator:
Basic – weighted average shares outstanding	1,330.5		1,329.4
Effect of dilutive securities:
Employee stock options	1.2		2.7
Employee restricted stock units	1.7		1.3
Employee performance share units	0.3		1.1
Diluted – weighted average shares outstanding	1,333.8		1,334.5
Basic earnings per share	$	0.59	$	0.70
Diluted earnings per share	$	0.59	$	0.70

The calculation of weighted average diluted shares outstanding excludes options to purchase approximately 22 million and 14 million ordinary shares for the three months ended July 28, 2023 and July 29, 2022, respectively, because their effect would have been anti-dilutive on the Company’s earnings per share.

13. Stock-Based Compensation

The following table presents the components and classification of stock-based compensation expense for stock options, restricted stock, performance share units, and employee stock purchase plan shares recognized for the three months ended July 28, 2023 and July 29, 2022:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Stock options	$	12	$	12
Restricted stock	38		27
Performance share units	12		12
Employee stock purchase plan	11		11
Total stock-based compensation expense	$	73	$	62
Cost of products sold	$	7	$	6
Research and development expense	9		7
Selling, general, and administrative expense	58		49
Total stock-based compensation expense	73		62
Income tax benefits	(11)		(11)
Total stock-based compensation expense, net of tax	$	62	$	51

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

14. Retirement Benefit Plans

The Company sponsors various retirement benefit plans, including defined benefit pension plans, post-retirement medical plans, defined contribution savings plans, and termination indemnity plans, covering substantially all U.S. employees and many employees outside the U.S. The net periodic benefit cost of the defined benefit pension plans included the following components for the three months ended July 28, 2023 and July 29, 2022:

	U.S.				Non-U.S.
	Three months ended				Three months ended
(in millions)	July 28, 2023		July 29, 2022		July 28, 2023		July 29, 2022
Service cost	$	15	$	19	$	10	$	12
Interest cost	40		36		12		10
Expected return on plan assets	(65)		(56)		(17)		(16)
Amortization of prior service cost	(1)		—		—		—
Amortization of net actuarial loss	5		5		—		1
Net periodic benefit (credit) cost	$	(6)	$	4	$	5	$	7

Components of net periodic benefit cost other than the service component are recognized in other non-operating income, net in the consolidated statements of income.

15. Accumulated Other Comprehensive Loss

The following table provides changes in accumulated other comprehensive loss (AOCI), net of tax, and by component:

(in millions)	Unrealized (Loss) Gain on Investment Securities		Cumulative Translation Adjustments		Net Investment Hedges		Net Change in Retirement Obligations		Unrealized Gain (Loss) on Cash Flow Hedges		Total Accumulated Other Comprehensive (Loss) Income
April 28, 2023	$	(258)	$	(2,839)	$	245	$	(741)	$	93	$	(3,499)
Other comprehensive (loss) income before reclassifications	(28)		14		(143)		1		12		(144)
Reclassifications	8		—		—		2		(42)		(32)
Other comprehensive (loss) income	(19)		14		(143)		3		(30)		(175)
July 28, 2023	$	(277)	$	(2,825)	$	102	$	(738)	$	63	$	(3,674)
(in millions)	Unrealized (Loss) Gain on Investment Securities		Cumulative Translation Adjustment		Net Investment Hedges		Net Change in Retirement Obligations		Unrealized Gain (Loss) on Cash Flow Hedges		Total Accumulated Other Comprehensive (Loss) Income
April 29, 2022	$	(209)	$	(2,599)	$	841	$	(773)	$	474	$	(2,265)
Other comprehensive income (loss) before reclassifications	(22)		(881)		1,002		3		312		414
Reclassifications	6		—		—		(2)		(91)		(87)
Other comprehensive income (loss)	(16)		(881)		1,002		1		220		326
July 29, 2022	$	(225)	$	(3,480)	$	1,843	$	(772)	$	694	$	(1,939)

The income tax on gains and losses on investment securities in other comprehensive income before reclassifications during the three months ended July 28, 2023 and July 29, 2022 was a benefit of $3 million and $9 million, respectively. During the three months ended July 28, 2023 and July 29, 2022, realized gains and losses on investment securities reclassified from AOCI were reduced by income taxes of $3 million and $2 million, respectively. When realized, gains and losses on investment securities reclassified from AOCI are recognized within other non-operating income, net. Refer to Note 6 to the consolidated financial statements for additional information.

For the three months ended July 28, 2023, there was no income tax on cumulative translation adjustment. For the three months ended July 29, 2022, the income tax on cumulative translation adjustment was a benefit of $3 million.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

During the three months ended July 28, 2023 and July 29, 2022, there were no tax impacts on net investment hedges. Refer to Note 8 to the consolidated financial statements for additional information.

The net change in retirement obligations in other comprehensive income includes amortization of net actuarial losses included in net periodic benefit cost. During the three months ended July 28, 2023, there were no tax impacts on retirement obligations. During the three months ended July 29, 2022, the net change in retirement obligations in other comprehensive income before reclassifications resulted in income tax expense of $1 million. During the three months ended July 28, 2023 and July 29, 2022, the gains and losses on defined benefit and pension items reclassified from AOCI were reduced by income taxes of $1 million and $6 million, respectively. When realized, net gains and losses on defined benefit and pension items reclassified from AOCI are recognized within other non-operating income, net. Refer to Note 14 to the consolidated financial statements for additional information.

The income tax on unrealized gains and losses on cash flow hedges in other comprehensive income before reclassifications during the three months ended July 28, 2023 and July 29, 2022, was an expense of $25 million and $64 million, respectively. During the three months ended July 28, 2023 and July 29, 2022, gains and losses on cash flow hedges reclassified from AOCI were reduced by income taxes of $13 million and $22 million, respectively. When realized, gains and losses on currency exchange rate contracts reclassified from AOCI are recognized within other operating expense, net or cost of products sold. Refer to Note 8 to the consolidated financial statements for additional information.

16. Commitments and Contingencies

Legal Matters

The Company and its affiliates are involved in a number of legal actions from time to time involving product liability, employment, intellectual property and commercial disputes, shareholder related matters, environmental proceedings, tax disputes, and governmental proceedings and investigations, including those described below. With respect to governmental proceedings and investigations, like other companies in our industry, the Company is subject to extensive regulation by national, state, and local governmental agencies in the United States and in other jurisdictions in which the Company and its affiliates operate. As a result, interaction with governmental agencies is ongoing. The Company’s standard practice is to cooperate with regulators and investigators in responding to inquiries. The outcomes of legal actions are not within the Company’s complete control and may not be known for prolonged periods of time. In some actions, the enforcement agencies or private claimants seek damages, as well as other civil or criminal remedies (including injunctions barring the sale of products that are the subject of the proceeding), that could require significant expenditures, result in lost revenues, or limit the Company's ability to conduct business in the applicable jurisdictions.

The Company records a liability in the consolidated financial statements on an undiscounted basis for loss contingencies related to legal actions when a loss is known or considered probable and the amount may be reasonably estimated. If the reasonable estimate of a known or probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. If a loss is reasonably possible but not known or probable, and may be reasonably estimated, the estimated loss or range of loss is disclosed. When determining the estimated loss or range of loss, significant judgment is required. Estimates of probable losses resulting from litigation and governmental proceedings involving the Company are inherently difficult to predict, particularly when the matters are in early procedural stages with incomplete scientific facts or legal discovery, involve unsubstantiated or indeterminate claims for damages, potentially involve penalties, fines or punitive damages, or could result in a change in business practice. The Company classifies certain specified litigation charges and gains related to significant legal matters as certain litigation charges in the consolidated statements of income. The Company recognized $40 million of certain litigation charges during the three months ended July 28, 2023, whereas the Company recognized no certain litigation charges during the three months ended July 29, 2022. At July 28, 2023 and April 28, 2023, accrued litigation was approximately $0.3 billion. The ultimate cost to the Company with respect to accrued litigation could be materially different than the amount of the current estimates and accruals and could have a material adverse impact on the Company’s consolidated earnings, financial position, and/or cash flows. The Company includes accrued litigation in other accrued expenses and other liabilities on the consolidated balance sheets. While it is not possible to predict the outcome for most of the legal matters discussed below, the Company believes it is possible that the costs associated with these matters could have a material adverse impact on the Company’s consolidated earnings, financial position, and/or cash flows.

Intellectual Property Matters

At any given time, the Company is involved in litigation relating to patents, trademarks, copyrights, trade secrets, and other intellectual property (IP) rights, and licenses, acquisitions or other agreements relating to such rights. This litigation includes, but is not limited to, alleged infringement or misappropriation of IP rights, or breach of obligations related to IP rights, or other claims asserted by competitors, individuals, or, consistent with a growing trend across technology-intensive industries, other entities created specifically to fund IP litigation. While the outcome of these litigation matters is inherently uncertain, it is possible that the results of such litigation could require the Company to pay significant monetary damages and/or royalty payments, and negatively impact the Company's ability to sell current or

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

future products, which could have a material adverse impact on the Company's business, results of operations, financial condition, and cash flows.

Colibri

The Company is a defendant in patent litigation brought by Colibri Heart Valve LLC (Colibri) in the U.S. District Court for the Central District of California. Colibri alleges infringement of one patent by the Company’s Evolut family of transcatheter aortic valve replacement devices. The patent asserted by Colibri has expired. On February 8, 2023, a jury returned a verdict against the Company for approximately $106 million. In July 2023, the Company filed its appeal with the U.S. Court of Appeals for the Federal Circuit. The Company has not recognized an expense in connection with this matter because it does not currently believe a loss is probable.

Product Liability Matters

Pelvic Mesh Litigation

The Company is currently involved in litigation in various state and federal courts against manufacturers of pelvic mesh products alleging personal injuries resulting from the implantation of those products. Two subsidiaries of Covidien supplied pelvic mesh products to one of the manufacturers, C.R. Bard (Bard), named in the litigation. The litigation includes a federal multi-district litigation in the U.S. District Court for the Northern District of West Virginia and cases in various state courts and jurisdictions outside the U.S. Generally, complaints allege design and manufacturing claims, failure to warn, breach of warranty, fraud, violations of state consumer protection laws and loss of consortium claims. In fiscal year 2016, Bard paid the Company $121 million towards the settlement of 11,000 of these claims. In May 2017, the agreement with Bard was amended to extend the terms to apply to up to an additional 5,000 claims. That agreement does not resolve the dispute between the Company and Bard with respect to claims that do not settle, if any. As part of the agreement, the Company and Bard agreed to dismiss without prejudice their pending litigation with respect to Bard’s obligation to defend and indemnify the Company. The Company estimates law firms representing approximately 16,200 claimants have asserted or may assert claims involving products manufactured by Covidien’s subsidiaries. As of August 2, 2023, the Company had reached agreements to settle approximately 15,900 of these claims. The Company's accrued expenses for this matter are included within accrued litigation as discussed above.

Hernia Mesh Litigation

Starting in fiscal year 2020, plaintiffs began filing lawsuits against certain subsidiaries of the Company in U.S. state and federal courts that allege personal injury from hernia mesh products sold by those subsidiaries. As of August 2, 2023, the Company and certain of its subsidiaries have been named as defendants in lawsuits filed on behalf of approximately 7,450 individual plaintiffs, and certain plaintiffs’ law firms have advised the Company that they may file additional cases in the future. Approximately 6,400 plaintiffs have filed lawsuits in a coordinated proceeding in Massachusetts state court, where they have been consolidated before a single judge. Approximately 500 plaintiffs have filed lawsuits in a coordinated action in Minnesota state court, and there are approximately 550 actions coordinated in a federal Multidistrict Litigation in the U.S. District Court for the District of Massachusetts. The pending lawsuits relate almost entirely to hernia mesh products that have not been subject to recalls, withdrawals, or other adverse regulatory action. The Company has not recorded an expense related to damages in connection with these matters because any potential loss is not currently probable and reasonably estimable. Additionally, the Company is unable to reasonably estimate the range of loss, if any, that may result from these matters.

Diabetes Pump Retainer Ring Litigation

Starting in fiscal year 2021, plaintiffs began filing lawsuits against the Diabetes operating unit in U.S. state and federal courts alleging personal injury from Series 600 insulin pumps with allegedly defective clear retainer rings that were subject to field corrective actions in 2019 and 2021. As of August 3, 2023, 63 individual plaintiffs have filed lawsuits, and certain plaintiffs’ law firms have notified the Company that they may file additional lawsuits in the future on behalf of thousands of additional claimants. Most of the filed suits are coordinated in California state court. The Company has not recorded an expense related to damages in connection with these matters because any potential loss is not currently probable and reasonably estimable. Additionally, the Company is unable to reasonably estimate the range of loss, if any, that may result from these matters.

Environmental Proceedings

The Company is a successor to several investigation and cleanup actions at various stages related to environmental remediation matters at a number of sites, including in Orrington, Maine. These projects relate to a variety of activities, including removal of solvents, metals and other hazardous substances from soil and groundwater. The ultimate cost of site cleanup and timing of future cash flows is difficult to predict given uncertainties regarding the extent of the required cleanup, the interpretation of applicable laws and regulations, and alternative cleanup methods.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

The Company is also a successor to a party named in a lawsuit filed in the U.S. District Court for the District of Maine in the early 2000's by the Natural Resources Defense Council and the Maine People's Alliance relating to mercury contamination of the Penobscot River and Bay and options for remediating such contamination. In March 2021, the parties notified the court that they had agreed on a settlement in principle of all issues in this matter, and in September 2022 the parties filed a joint motion for final approval by the court. In October 2022, the court issued a final order approving the settlement and the parties are working with consultants on implementation of remedial activities. The final court order did not result in a change to the Company's previous accrual for this matter.

The Company's accrued expenses for these various environmental proceedings are included within accrued litigation as discussed above.

Income Taxes

In March 2009, the IRS issued its audit report on Medtronic, Inc. for fiscal years 2005 and 2006. Medtronic, Inc. reached agreement with the IRS on some, but not all matters related to these fiscal years. The remaining unresolved issue for fiscal years 2005 and 2006 relates to the allocation of income between Medtronic, Inc. and its wholly-owned subsidiary operating in Puerto Rico, which is one of the Company's key manufacturing sites. The U.S. Tax Court (Tax Court) reviewed this dispute, and in June 2016, issued an opinion with respect to the allocation of income between the parties for fiscal years 2005 and 2006 whereby it generally rejected the IRS’s position, but also made certain modifications to the Medtronic, Inc. tax returns as filed. In April 2017, the IRS filed a Notice of Appeal to the U.S. Court of Appeals for the Eighth Circuit regarding the Tax Court opinion. Oral argument for the Appeal occurred in March 2018. The U.S. Court of Appeals issued its opinion in August 2018 and remanded the case back to the Tax Court for additional factual findings, which it concluded in June 2021. The Tax Court issued its opinion on August 18, 2022, and it remains subject to appeal by either or both parties. At this time, the Company is evaluating whether to file an appeal.

The IRS has issued its audit reports on Medtronic, Inc. for fiscal years 2007 through 2016. Medtronic, Inc. and the IRS have reached agreement on all significant issues except for the allocation of income between Medtronic, Inc. and its wholly-owned subsidiary operating in Puerto Rico for the businesses that are the subject of the U.S. Tax Court matter for fiscal years 2005 and 2006.

Medtronic, Inc.’s fiscal years 2017, 2018, and 2019 U.S. federal income tax returns are currently being audited by the IRS.

Covidien LP (a wholly owned subsidiary of Medtronic plc) has either reached agreement with the IRS or the statute of limitations has lapsed on its U.S. federal income tax returns through fiscal year 2019.

Although it is not possible to predict the outcome for most of the income tax matters discussed above, the Company believes it is possible that charges associated with these matters could have a material adverse impact on the Company’s consolidated earnings, financial position, and/or cash flows.

Refer to Note 11 for additional discussion of income taxes.

Guarantees

In the normal course of business, the Company and/or its affiliates periodically enter into agreements that require one or more of the Company and/or its affiliates to indemnify customers or suppliers for specific risks, such as claims for injury or property damage arising as a result of the Company or its affiliates’ products, the negligence of the Company's personnel, or claims alleging that the Company's products infringe on third-party patents or other intellectual property. The Company also offers warranties on various products. The Company’s maximum exposure under these guarantees is unable to be estimated. Historically, the Company has not experienced significant losses on these types of guarantees.

The Company believes the ultimate resolution of the above guarantees is not expected to have a material effect on the Company’s consolidated earnings, financial position, and/or cash flows.

17. Segment and Geographic Information

Segment disclosures are on a performance basis consistent with internal management reporting. Net sales of the Company's reportable segments include end-customer revenues from the sale of products the segment develops, manufactures, and distributes. The Company’s management evaluates performance of the segments and allocates resources based on net sales and segment operating profit. Segment operating profit represents income before income taxes, excluding interest income or expense, amortization of intangible assets, centralized distribution costs, currency impact of remeasurement and hedging, non-operating income or expense items, certain corporate charges, stock-based compensation, and other items not allocated to the segments.

The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies in Note 1 to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended April 28, 2023. Certain depreciable assets may be recorded by one segment, while the depreciation expense is allocated to another segment. The allocation of depreciation expense is based on the proportion of the assets used by each segment.

Medtronic plc

Notes to Consolidated Financial Statements

(Unaudited)

As of the beginning of fiscal year 2024, the Company realigned the operating segment structure as a result of how the Chief Operating Decision Maker assesses business performance. We continue to have four reportable segments: Cardiovascular Portfolio, Neuroscience Portfolio, Medical Surgical Portfolio, and Diabetes Operating Unit. The Medical Surgical Portfolio now consists of two operating segments which have been aggregated based upon similar economic and operating characteristics. Prior period segment operating profit has been recast to reflect the new reporting structure, which primarily includes allocating certain prior Medical Surgical businesses to the Other line. Prior period amounts have also been recast to reallocate certain expenses from segment operating profit to centralized distribution costs to conform to classifications used in the current year.

The following tables present reconciliations of financial information from the segments to the applicable line items in the Company's consolidated financial statements:

Segment Operating Profit

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Cardiovascular	$	1,092	$	979
Neuroscience	929		841
Medical Surgical	719		693
Diabetes	84		79
Other (1)	4		(24)
Segment operating profit	2,828		2,567
Interest expense, net	(148)		(164)
Other non-operating income, net	76		83
Amortization of intangible assets	(429)		(423)
Corporate	(447)		(414)
Stock-based compensation	(73)		(62)
Centralized distribution costs	(395)		(406)
Currency (2)	(3)		81
Restructuring and associated costs	(91)		(76)
Acquisition and divestiture-related items	(50)		(109)
Certain litigation charges	(40)		—
Medical device regulations	(31)		(32)
Income before income taxes	$	1,196	$	1,044

(1)Includes the operations from the Renal Care Solutions business contributed to Mozarc Medical on April 1, 2023 and Transition Manufacturing and Service Agreements for previously divested businesses.

(2)Includes the net impact of remeasurement and the Company's hedging programs recorded in other operating expense, net.

Geographic Information

Net sales are attributed to the country based on the location of the customer taking possession of the products or in which the services are rendered. The following table presents net sales for the three months ended July 28, 2023 and July 29, 2022 for the Company's country of domicile, countries with significant concentrations, and all other countries:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Ireland	$	29	$	23
United States	3,924		3,766
Rest of world	3,749		3,582
Total other countries, excluding Ireland	7,673		7,348
Total	$	7,702	$	7,371

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

UNDERSTANDING OUR FINANCIAL INFORMATION

The following discussion and analysis provides information management believes to be relevant to understanding the financial condition and results of operations of Medtronic plc and its subsidiaries (Medtronic plc, Medtronic, or the Company, or we, us, or our). For a full understanding of financial condition and results of operations, you should read this discussion along with Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended April 28, 2023. In addition, you should read this discussion along with our consolidated financial statements and related notes thereto at and for the three months ended July 28, 2023. Amounts reported in millions within this quarterly report are computed based on the amounts in thousands, and therefore, the sum of the components may not equal the total amount reported in millions due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding.

Financial Trends

Throughout this Management’s Discussion and Analysis, we present certain financial measures that facilitate management's review of the operational performance of the Company and as a basis for strategic planning; however, such financial measures are not presented in our financial statements prepared in accordance with accounting principles generally accepted in the United States (U.S.) (U.S. GAAP). These financial measures are considered "non-GAAP financial measures" and are intended to supplement, and should not be considered as superior to, financial measures presented in accordance with U.S. GAAP. We believe that non-GAAP financial measures provide information useful to investors in understanding the Company's underlying operational performance and trends and may facilitate comparisons with the performance of other companies in the medical technologies industry.

As presented in the GAAP to Non-GAAP Reconciliations section on the following pages, our non-GAAP financial measures exclude the impact of amortization of intangible assets and certain charges or benefits that contribute to or reduce earnings and that may affect financial trends and include certain charges or benefits that result from transactions or events that we believe may or may not recur with similar materiality or impact to our operations in future periods (Non-GAAP Adjustments).

In the event there is a Non-GAAP Adjustment recognized in our operating results, the tax cost or benefit attributable to that item is separately calculated and reported. Because the effective rate can be significantly impacted by the Non-GAAP Adjustments that take place during the period, we often refer to our tax rate using both the effective rate and the non-GAAP nominal tax rate (Non-GAAP Nominal Tax Rate). The Non-GAAP Nominal Tax Rate is calculated as the income tax provision, adjusted for the impact of Non-GAAP Adjustments, as a percentage of income before income taxes, excluding Non-GAAP Adjustments.

Free cash flow is a non-GAAP financial measure calculated by subtracting property, plant, and equipment additions from operating cash flows.

Refer to the “GAAP to Non-GAAP Reconciliations," "Income Taxes," and "Free Cash Flow" sections for reconciliations of the non-GAAP financial measures to their most directly comparable financial measures prepared in accordance with U.S. GAAP.

EXECUTIVE LEVEL OVERVIEW

Medtronic is the leading global healthcare technology company — alleviating pain, restoring health, and extending life for millions of people around the world. Our primary products include those for cardiac rhythm disorders, cardiovascular disease, advanced and general surgical care, respiratory and monitoring solutions, neurological disorders, spinal conditions and musculoskeletal trauma, urological and digestive disorders, and ear, nose, and throat, and diabetes conditions.

The following is a summary of revenue, diluted earnings per share, and operating cash flow for the three months ended July 28, 2023 and July 29, 2022:

GAAP to Non-GAAP Reconciliations

The tables below present our GAAP to Non-GAAP reconciliations for the three months ended July 28, 2023 and July 29, 2022:

	Three months ended July 28, 2023
(in millions, except per share data)	Income Before Income Taxes		Income <br>Tax Provision<br>(Benefit)		Net Income Attributable to Medtronic		Diluted EPS		Effective <br>Tax Rate
GAAP	$	1,196	$	400	$	791	$	0.59	33.4	%
Non-GAAP Adjustments:
Amortization of intangible assets	429		65		364		0.27		15.2
Restructuring and associated costs(2)	91		15		76		0.06		16.5
Acquisition and divestiture-related items(3)	50		3		46		0.03		6.0
Certain litigation charges	40		9		31		0.02		22.5
(Gain)/loss on minority investments(4)	64		—		64		0.05		—
Medical device regulations(5)	31		7		25		0.02		22.6
Certain tax adjustments, net(6)	—		(198)		198		0.15		—
Non-GAAP	$	1,902	$	300	$	1,596	$	1.20	15.8	%
	Three months ended July 29, 2022
(in millions, except per share data)	Income Before Income Taxes		Income <br>Tax Provision (Benefit)		Net Income Attributable to Medtronic		Diluted EPS		Effective <br>Tax Rate
GAAP	$	1,044	$	112	$	929	$	0.70	10.7	%
Non-GAAP Adjustments:
Amortization of intangible assets	423		65		359		0.27		15.4
Restructuring and associated costs(2)	76		16		60		0.04		21.1
Acquisition and divestiture-related items(3)	109		7		102		0.08		6.4
(Gain)/loss on minority investments(4)	(4)		—		(4)		—		—
Medical device regulations(5)	32		6		26		0.02		18.8
Debt redemption premium and other charges(7)	53		11		42		0.03		20.8
Certain tax adjustments, net(8)	—		13		(13)		(0.01)		—
Non-GAAP	$	1,734	$	230	$	1,502	$	1.13	13.3	%

(1)The data in this schedule has been intentionally rounded to the nearest million or $0.01 for EPS figures, and, therefore, may not sum.

(2)Associated costs include costs incurred as a direct result of the restructuring program, such as salaries for employees supporting the program and consulting expenses.

(3)The charges primarily include business combination costs, changes in fair value of contingent consideration, and charges related to the impending separation of the Patient Monitoring and Respiratory Interventions businesses within our Medical Surgical Portfolio. The prior year included non-cash pre-tax impairments, primarily related to goodwill, as a result of the April 1, 2023 sale of half of the Company's Renal Care Solutions (RCS) business.

(4)We exclude unrealized and realized gains and losses on our minority investments as we do not believe that these components of income or expense have a direct correlation to our ongoing or future business operations.

(5)The charges represent incremental costs of complying with the new European Union (E.U.) medical device regulations for previously registered products and primarily include charges for contractors supporting the project and other direct third-party expenses. We consider these costs to be duplicative of previously incurred costs and/or one-time costs, which are limited to a specific time period.

(6)The charge relates to an income tax reserve adjustment associated with the June 1, 2023 Israeli Central-Lod District Court decision in Medtronic Ventor Technologies Ltd v. Kfar Saba Assessing Office and amortization of previously established deferred tax assets from intercompany intellectual property transactions.

(7)The charges relate to the early redemption of approximately $2.3 billion of debt and were recorded within interest expense, net within the consolidated statements of income.

(8)The net benefit is due to a valuation allowance release associated with certain carryover attributes as a result of the RCS transaction listed above in (3) partially offset by the amortization of previously established deferred tax assets from intercompany intellectual property transactions.

Free Cash Flow

Free cash flow, a non-GAAP financial measure, is calculated by subtracting additions to property, plant, and equipment from net cash provided by operating activities. Management uses this non-GAAP financial measure, in addition to U.S. GAAP financial measures, to evaluate our operating results. Free cash flow should be considered supplemental to, and not a substitute for, our reported financial results prepared in accordance with U.S. GAAP. Reconciliations between net cash provided by operating activities (the most comparable U.S. GAAP measure) and free cash flow are as follows:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Net cash provided by operating activities	$	875	$	1,083
Additions to property, plant, and equipment	(354)		(426)
Free cash flow	$	521	$	657

Refer to the Summary of Cash Flows section for drivers of the change in cash provided by operating activities.

NET SALES

Segment and Division

Prior period revenue has been recast to reflect the new reporting structure, which primarily includes allocating certain prior Medical Surgical businesses to the Other line. Refer to Note 17 to the consolidated financial statements for additional information regarding the Company's new reporting structure. The charts below illustrate the percent of net sales by segment for the three months ended July 28, 2023 and July 29, 2022:

The table below illustrates net sales by segment and division for the three months ended July 28, 2023 and July 29, 2022:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022		% Change
Cardiac Rhythm & Heart Failure	$	1,446	$	1,381	5	%
Structural Heart & Aortic	814		741		10
Coronary & Peripheral Vascular	589		579		2
Cardiovascular	2,850		2,701		6
Cranial & Spinal Technologies	1,103		1,043		6
Specialty Therapies	695		667		4
Neuromodulation	420		405		4
Neuroscience	2,219		2,115		5
Surgical & Endoscopy	1,546		1,455		6
Patient Monitoring & Respiratory Interventions	493		479		3
Medical Surgical	2,039		1,933		6
Diabetes	578		541		7
Other(1)	16		81		(80)
Total	$	7,702	$	7,371	5	%

(1) Includes revenue from the divested Renal Care Solutions business and Transition Manufacturing Agreements from previously divested businesses.

Segment and Market Geography

The charts below illustrate the percent of net sales by market geography for the three months ended July 28, 2023 and July 29, 2022:

The table below includes net sales by market geography for each of our segments for the three months ended July 28, 2023 and July 29, 2022:

	U.S.(1)						Non-U.S. Developed Markets(2)						Emerging Markets(3)
	Three months ended						Three months ended						Three months ended
(in millions)	July 28, 2023		July 29, 2022		% Change		July 28, 2023		July 29, 2022		% Change		July 28, 2023		July 29, 2022		% Change
Cardiovascular	$	1,350	$	1,286	5	%	$	956	$	892	7	%	$	544	$	523	4	%
Neuroscience	1,497		1,419		5		416		407		2		306		290		6
Medical Surgical	881		831		6		772		735		5		386		368		5
Diabetes	188		206		(9)		315		264		19		75		72		4
Other(4)	8		25		(68)		5		32		(84)		3		24		(88)
Total	$	3,924	$	3,766	4	%	$	2,463	$	2,328	6	%	$	1,314	$	1,276	3	%

(1)U.S. includes the United States and U.S. territories.

(2)Non-U.S. developed markets include Japan, Australia, New Zealand, Korea, Canada, and the countries within Western Europe.

(3)Emerging markets include the countries of the Middle East, Africa, Latin America, Eastern Europe, and the countries of Asia that are not included in the non-U.S. developed markets, as defined above.

(4)Includes revenue from the divested Renal Care Solutions business and Transition Manufacturing Agreements from previously divested businesses.

The increase in net sales for the three months ended July 28, 2023, as compared to the corresponding period in the prior fiscal year, was driven primarily by growth in most products lines and businesses, including Micra, Transcatheter Aortic Valve replacements (TAVR), Core Spine in the U.S., Advanced Energy, and Diabetes.

Looking ahead, a number of macro-economic and geopolitical factors could negatively impact our business, including without limitation:

•Competitive product launches and pricing pressure, geographic macro-economic risks including fluctuations in currency exchange rates, general price inflation, rising interest rates, reimbursement challenges, impacts from changes in the mix of our product offerings, delays in product registration approvals, replacement cycle challenges, and supply chain challenges in certain businesses;

•National and provincial tender pricing for certain products, particularly in China;

•The sanctions and other measures being imposed in response to the Russia-Ukraine conflict are having, and could continue to have impacts on revenue and supply chain. The financial impact of the conflict in the first quarter of fiscal year 2024, including on accounts receivable and inventory reserves, was not material, and for the three months ended July 28, 2023, the business of the Company in these countries represented less than 1% of the Company's consolidated revenues and assets. Although the implications of this conflict are difficult to predict at this time, the ongoing conflict may increase pressure on the global economy and supply chains, resulting in increased future volatility risk for our business operations and performance.

Cardiovascular

Cardiovascular products include pacemakers, insertable cardiac monitors, cardiac resynchronization therapy devices, implantable cardioverter defibrillators (ICD), leads and delivery systems, electrophysiology catheters, products for the treatment of atrial fibrillation, information systems for the management of patients with Cardiac Rhythm & Heart Failure devices, products designed to reduce surgical site infections, coronary and peripheral stents and related delivery systems, balloons and related delivery systems, endovascular stent graft systems, heart valve replacement technologies, cardiac tissue ablation systems, and open heart and coronary bypass grafting surgical products. Cardiovascular also includes Cath Lab Managed Services (CLMS) within the Cardiac Rhythm & Heart Failure division. Cardiovascular's net sales for the three months ended July 28, 2023 was $2.9 billion, an increase of 6 percent as compared to the corresponding period in the prior fiscal year. The net sales increase was primarily due to strong performance of Micra, TAVR, Cannula, and Perfusion.

The graphs below illustrate the percent of Cardiovascular net sales by division for the three months ended July 28, 2023 and July 29, 2022:

Cardiac Rhythm & Heart Failure (CRHF) net sales for the three months ended July 28, 2023 increased 5 percent, as compared to the corresponding period in the prior fiscal year. The net sales increase was driven by continued adoption of Micra, including the U.S. launch of Micra AV2 and Micra VR2, and growth from CRT-Ds, transvenous pacemakers, and Arctic Front cryoablation catheters.

Structural Heart & Aortic (SHA) net sales for the three months ended July 28, 2023 increased 10 percent, as compared to the corresponding period in the prior fiscal year. The net sales increase was driven by growth in TAVR, including the recent U.S. and Japan launch of Evolut FX TAVR system, and in Cardiac Surgery driven by growth in Cannula and Perfusion particularly in the U.S.

Coronary & Peripheral Vascular (CPV) net sales for the three months ended July 28, 2023 increased 2 percent, as compared to the corresponding period in the prior fiscal year. The increase in net sales was driven by the launch of Onyx Frontier, as well as growth in guide catheters and drug coated balloons, and performance of our vascular embolization and superficial venous product portfolio, including the VenaSeal system.

In addition to the macro-economic and geopolitical factors described in the Executive Level Overview, looking ahead, we expect Cardiovascular could be affected by the following:

•Continued growth of our Micra transcatheter pacing system including the recent U.S. launch of Micra AV2 and Micra VR2 and increasing global penetration.

•Continued acceptance and growth from the Azure XT and Azure S SureScan pacing systems and the 3830 lead. Azure pacemakers feature Medtronic-exclusive BlueSync technology, which enables automatic, secure wireless remote monitoring with increased device longevity. The 3830 lead, previously labeled for His-bundle pacing, has now been expanded to include left bundle branch area pacing effectively covering all current forms of conduction system pacing.

•Growth of the Cobalt and Crome portfolio of ICDs and CRT-Ds.

•Growth of the CRT-P quadripolar pacing system.

•Continued growth, adoption, and utilization of the TYRX Envelope for implantable devices.

•Continued acceptance and expansion of the LINQ II cardiac monitor with AccuRhythm AI algorithms.

•Continued growth of Arctic Front cryoablation for treatment of atrial fibrillation.

•Acceptance and growth of the Affera Mapping/Navigation System and Sphere 9 mapping/ablation catheter. The system was launched under a limited market release in the fourth quarter of fiscal year 2023 in Western Europe.

•Continued acceptance and growth of the self-expanding CoreValve Evolut transcatheter aortic valve replacement platform. This includes Evolut PRO which provides enhanced hemodynamics, reliable delivery, enhanced durability, advanced sealing, and Evolut FX, a system designed to improve the overall procedural experience through enhancements in deliverability, implant visibility, and deployment stability.

•Continued acceptance and growth of the Onyx Frontier DES platform. The platform launched in the U.S. in the first quarter of fiscal year 2023 and in select international countries in the second quarter of fiscal year 2023. Onyx Frontier is a drug-eluding stent (DES) that introduces an enhanced delivery system and is used for complex percutaneous coronary intervention (PCI).

•Continued acceptance of the VenaSeal Closure System in the U.S. The VenaSeal Closure System is a unique non-thermal solution to address superficial venous disease that provides improved patient comfort, reduces the recovery time, and eliminates the risk of thermal nerve injury.

•Acceptance and growth of IN.PACT 018 drug-coated balloons (DCB). The product was launched under limited market release in the first quarter of fiscal year 2023 with full market release in the third quarter of fiscal year 2023. IN.PACT 018 adds to the existing IN.PACT Admiral DCB portfolio and is used to treat femoropopliteal disease.

•Our ability to successfully develop, obtain regulatory approval of and commercialize the products within our pipeline, which include the Symplicity Spyral Multi-Electrode Renal Denervation Catheter, Pulse Field Ablation, a novel energy source that is non-thermal, and Aurora Extravascular ICD.

Neuroscience

Neuroscience's products include various spinal implants, bone graft substitutes, biologic products, image-guided surgery and intra-operative imaging systems, robotic guidance systems used in the robot-assisted spine procedures, and systems that incorporate advanced energy surgical instruments. Neuroscience's products also focus on therapies to treat the diseases of the vasculature in and around the brain, including coils, neurovascular stents, and flow diversion products, as well as products to treat ear, nose, and throat (ENT), and the treatment of overactive bladder, urinary retention, and fecal incontinence. Neuroscience also manufactures products related to implantable neurostimulation therapies and drug delivery systems for the treatment of chronic pain, movement disorders, and epilepsy. Neuroscience’s net sales for the three months ended July 28, 2023 were $2.2 billion, an increase of 5 percent compared to the corresponding period in the prior fiscal year. The net sales increase was primarily due to growth in U.S. Spine & Biologics, Neurosurgery, and ENT.

The graphs below illustrate the percent of Neuroscience net sales by division for the three months ended July 28, 2023 and July 29, 2022:

Cranial and Spinal Technologies (CST) net sales for the three months ended July 28, 2023 increased 6 percent, as compared to the corresponding period in the prior fiscal year. The growth was driven by increased sales of Spine & Biologics products in the U.S. based on the continued adoption of the Aible spinal ecosystem. The net sales increase was also attributable to strong growth of StealthStation Navigation and O-arm Imaging Systems, outside of the U.S.

Specialty Therapies (Specialty) net sales for the three months ended July 28, 2023 increased 4 percent, as compared to the corresponding period in the prior fiscal year. The increase was driven by growth in ENT, as well as hemorrhagic stroke flow diversion products. Pelvic Health experienced slight net sales declines due to recent competitive launches.

Neuromodulation (NM) net sales for the three months ended July 28, 2023 increased 4 percent, as compared to the corresponding period in the prior fiscal year. The net sales increase was driven by growth within Pain Stim, Targeted Drug Delivery, and Brain Modulation. Partially offsetting the growth was a decline in Interventional experienced due to competitive pressure.

In addition to the macro-economic and geopolitical factors described in the Executive Level Overview, looking ahead we expect Neuroscience could be affected by the following:

•Continued adoption and growth of our integrated solutions through the Aible offering, which integrates spinal implants with enabling technologies (StealthStation, O-arm Imaging Systems, and Midas), Mazor robotics, and UNiD Adaptive Spine Intelligence AI-driven technology for surgical planning and personalized spinal implants.

•Market acceptance and continued global adoption of innovative new spine products and procedural solutions within our CST operating unit, such as Catalyft PL, ModuLeX, CD Horizon Voyager System, and our Infinity OCT System, as well as continued growth from Titan spine titanium interbody implants with Nanolock technology.

•Continued growth of Pipeline Embolization Devices, endovascular treatments for large or giant wide-necked brain aneurysms.

•Continued acceptance and growth of the Solitaire X revascularization device for treatment of acute ischemic stroke and our React Catheter and Riptide aspiration system.

•Continued acceptance and growth of our Pelvic Health and ENT therapies, including our InterStim therapy with InterStim X and InterStim II recharge-free neurostimulators and InterStim Micro rechargeable neurostimulator for patients suffering from overactive bladder, (non-obtrusive) urinary retention, and chronic fecal incontinence, and capital equipment sales of the Stealth Station ENT surgical navigation system and intraoperative NIM nerve monitoring system.

•Continued acceptance and growth of Intersect ENT products used in the treatment of chronic rhinosinusitis.

•Market acceptance and growth from SCS therapy for treating chronic pain and Diabetic Peripheral Neuropathy (DPN) on the Intellis rechargeable neurostimulator and Vanta recharge-free neurostimulator.

•Continued acceptance and growth of our Percept family of DBS devices with proprietary BrainSense technology for objectifying and personalizing the treatment of Parkinson's Disease, epilepsy, and other movement disorders.

•Our ability to successfully develop, obtain regulatory approval of and commercialize the products within our pipeline, which include our closed-loop Percept devices with adaptive DBS (aDBS) and Inceptiv Neurostimulator, as well as our hemorrhagic stroke intravascular device, and our next-generation spine enabling technologies.

Medical Surgical

Medical Surgical’s products span the entire continuum of patient care from diagnosis to recovery, with a focus on diseases of the gastrointestinal tract, lungs, pelvic region, obesity, and preventable complications. The products include those for advanced and general surgical products, surgical stapling devices, vessel sealing instruments, wound closure, electrosurgery products, hernia mechanical devices, mesh implants, advanced ablation, interventional lung, ventilators, airway products, and sensors and monitors for pulse oximetry, capnography, level of consciousness and cerebral oximetry. Medical Surgical's net sales for the three months ended July 28, 2023 were $2.0 billion, an increase of 6 percent compared to the corresponding period in the prior fiscal year. The net sales increase was primarily driven by growth in Advanced Energy, primarily due to improved supply.

The graphs below illustrate the percent of Medical Surgical net sales by division for the three months ended July 28, 2023 and July 29, 2022:

Surgical & Endoscopy (SE) net sales for the three months ended July 28, 2023 increased 6 percent, as compared to the corresponding period in the prior fiscal year. The increase was predominantly attributable to growth in Advanced Energy and Barrx primarily driven by improved supply, as well as continued growth in GI Genius and PillCam.

Patient Monitoring & Respiratory Interventions (PMRI) net sales for the three months ended July 28, 2023 increased 3 percent, as compared to the corresponding period in the prior fiscal year. The net sales increase was largely due to growth in airways and monitors.

In addition to the macro-economic and geopolitical factors described in the Executive Level Overview, looking ahead we expect Medical Surgical could be affected by the following:

•The pending separation of the combined Patient Monitoring and Respiratory Interventions businesses from the Medical Surgical Portfolio. The Company announced its intention to pursue a separation in October 2022 and expects to complete the separation in the first half of fiscal year 2025.

•Acceptance and continued growth of Open-to-MIS (minimally invasive surgery) techniques and tools through our efforts to transition open surgery to MIS. Open-to-MIS initiative focuses on capturing the market opportunity that exists in transitioning open procedures to MIS, whether through traditional MIS, advanced instrumentation, or robotics. Through our approach, in parallel, we also expand our presence and optimize open surgery in current open surgery markets.

•Continued global acceptance and future growth of powered stapling and energy platform.

•Our ability to execute ongoing strategies addressing the competitive pressure of reprocessing vessel sealing disposables, near-term pressures to bariatric surgery procedure volumes in the U.S. from pharmaceuticals, and growth of our surgical soft tissue robotics procedures in the U.S.

•Our ability to create markets and drive products and procedures into emerging markets with our high quality and cost-effective surgical products designed for customers in emerging markets. An example is our ValleyLab LS10 single channel vessel sealing generator, which is compatible with our line of LigaSure instruments and designed for simplified use and affordability.

•Acceptance of less invasive standards of care in chronic and colorectal, as well as hepatology products, including products that span the care continuum from diagnostics to therapeutics. Recently launched products include GI Genius.

•Expanding the use of less invasive treatments and furthering our commitment to improving options for women with abnormal uterine bleeding. Our expanded and strengthened surgical offerings complement our global gynecology business.

•Global adoption of robotic-assisted surgery and installations of Hugo robotic assisted surgery (RAS) system for urologic, bariatric, gynecologic, and general surgery procedures. This includes continued integration and adoption of Touch Surgery Enterprise with the first artificial intelligence powered surgical videos and analytics platform to make it easier to train and discover new techniques within the robotics platform. The Hugo RAS system, which received CE Mark in October 2021, as well as secured additional regulatory approvals outside the U.S., is designed to help reduce unwanted variability, improve patient outcomes, and, by extension, lower per procedure cost.

•Our ability to successfully develop, obtain regulatory approval of and commercialize the products within our pipeline, which include our Hugo RAS system in the U.S., Signia powered stapling devices, and our next-gen Ligasure and Sonicision vessel sealing devices.

Diabetes

Diabetes' products include insulin pumps, continuous glucose monitoring (CGM) systems, and consumables. Diabetes' net sales for the three months ended July 28, 2023 were $578 million, an increase of 7 percent as compared to the corresponding period in the prior fiscal year. The increase in net sales was primarily driven by strong international growth as a result of the continued international expansion of the MiniMed 780G insulin pump system and integrated CGM. The launch of the MiniMed 780G insulin pump system in the U.S. also contributed to the growth.

In addition to the macro-economic and geopolitical factors described in the Executive Level Overview, looking ahead we expect Diabetes could be affected by the following:

•Continued acceptance and growth for the MiniMed 780G insulin pump system, which is powered by SmartGuard technology and features the added benefits of meal detection technology that automatically adjusts and corrects sugar levels every five minutes. The global adoption of sensor-augmented insulin pump systems has resulted in strong sensor attachment rates. The MiniMed 780G insulin pump system with the Guardian 4 Sensor was approved by the U.S. FDA in late April 2023.

•Continued acceptance and growth of the Guardian Connect CGM system, which displays glucose information directly to a smartphone to help ensure patients have access to their glucose levels seamlessly and discretely. The Guardian Connect CGM system is available on both Apple iOS and Android devices.

•Market acceptance and growth of our InPen smart pen system, which allows users to have their Medtronic CGM readings in real-time alongside insulin dose information, all in one view.

•Continued pump, CGM, and consumable competition in an expanding global market.

•Changes in medical reimbursement policies and programs, along with additional payor coverage on insulin pumps.

•Our ability to successfully develop, obtain regulatory approval of and commercialize the products within our pipeline, including our next-generation sensor Simplera, which has been submitted for approval to the U.S. FDA.

COSTS AND EXPENSES

The following is a summary of cost of products sold, research and development, and selling, general, and administrative expenses as a percent of net sales for the three months ended July 28, 2023 and July 29, 2022:

Cost of Products Sold Cost of products sold for the three months ended July 28, 2023 was $2.6 billion, as compared to $2.5 billion for the corresponding period in the prior fiscal year. The cost of products sold as a percentage of net sales was flat as compared to the prior year. Looking forward, our cost of products sold likely will be further negatively impacted by recent inflation and higher labor and direct material costs. We continue to focus on managing our costs of production through supplier management, manufacturing improvements, and optimizing our manufacturing network.

Research and Development Expense We remain committed to deliver the best possible experiences for patients, physicians, and caregivers we serve; to create technologies that expand what’s possible across the entire human body to transform lives; to turn data and insights into real action to serve patient needs improving care; and to expand healthcare access and deliver positive outcomes. Research and development expense for the three months ended July 28, 2023 was $668 million, as compared to $692 million for the corresponding period in the prior fiscal year. A contributing factor to the decrease in research and development expense compared to the prior year is the April 1, 2023 sale of the RCS business.

Selling, General, and Administrative Expense Our goal is to continue to leverage selling, general, and administrative expense initiatives. Selling, general, and administrative expense primarily consists of salaries and wages, other administrative costs, such as professional fees and marketing expenses, certain acquisition, divestiture, and separation-related costs, and restructuring expenses. Selling, general, and administrative expense for the three months ended July 28, 2023 and July 29, 2022 was $2.6 billion for both periods.

The following is a summary of other costs and expenses (income):

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Amortization of intangible assets	$	429	$	423
Restructuring charges, net	54		14
Certain litigation charges	40		—
Other operating expense, net	1		35
Other non-operating income, net	(76)		(83)
Interest expense, net	148		164

Amortization of Intangible Assets Amortization of intangible assets includes the amortization expense of our definite-lived intangible assets, consisting of purchased patents, trademarks, tradenames, customer relationships, purchased technology, and other intangible assets.

Restructuring Charges, Net For the three months ended July 28, 2023, restructuring costs primarily related to employee termination benefits to support cost reduction initiatives. For the three months ended July 29, 2022, restructuring charges primarily related to Enterprise Excellence and Simplification restructuring programs, both of which were substantially completed as of the end of fiscal year 2023. Enterprise Excellence was designed to leverage the Company’s global size and scale to focus on global operations, and functional and commercial optimization, and had total pre-tax charges of $1.8 billion. Simplification was designed to focus the organization on accelerating innovation, enhancing customer experience, driving revenue growth and winning market share, and had total pre-tax charges of $0.5 billion.

For additional information about our restructuring programs, refer to Note 5 to the current period's consolidated financial statements.

Certain Litigation Charges We classify specified certain litigation charges and gains related to significant legal matters as certain litigation charges in the consolidated statements of income. For additional information, refer to Note 16 in the current period's consolidated financial statements.

Other Operating Expense, Net Other operating expense, net primarily includes royalty expense, currency remeasurement and derivative gains and losses, Puerto Rico excise taxes, changes in the fair value of contingent consideration, certain acquisition and divestiture-related items, and income from funded research and development arrangements.

For the three months ended July 28, 2023, the change in other operating expense, net was driven by a $21 million decrease in Puerto Rico Excise Tax compared to the corresponding period in the prior year. As a result of newly enacted tax legislation in Puerto Rico, the Company is no longer subject to Puerto Rico Excise Tax, but is now subject to a higher withholding tax, which is recorded in income tax provision in the consolidated statements of income. Additionally, the change was driven by the net currency impact of remeasurement expense and our hedging programs, which resulted in a net loss of $3 million for the three months ended July 28, 2023 as compared to a net gain of $81 million for the corresponding period in the prior year. Further driving the change in other operating expense, net was $67 million of non-cash pre-tax impairments, primarily related to goodwill, as a result of the April 1, 2023 sale of half of the Company's RCS business and $22 million of integration and deal costs recorded during the three months ended July 29, 2022.

Other Non-Operating Income, Net Other non-operating income, net includes the non-service component of net periodic pension and postretirement benefit cost, investment gains and losses, and interest income.

For the three months ended July 28, 2023, the decrease in other non-operating income, net is primarily attributable to losses on our minority investment portfolio, partially offset by an increase in interest income. Net losses on minority investments were $64 million for the three months ended July 28, 2023, compared to a net gain of $4 million for the three months ended July 29, 2022. Interest income was $111 million and $55 million for the three months ended July 28, 2023 and July 29, 2022, respectively.

Interest Expense, Net Interest expense, net includes interest incurred on our outstanding borrowings, amortization of debt issuance costs and debt premiums or discounts, amortization of amounts excluded from the effectiveness assessment of certain net investment hedges, and charges recognized in connection with the early redemption of senior notes.

For the three months ended July 28, 2023, the decrease in interest expense, net was primarily due to $49 million in after-tax gains representing amounts excluded from the effectiveness assessment of certain net investment hedges, compared to $21 million for the corresponding period in the prior year. Further driving the decrease in interest expense, net was the $53 million charge incurred as a result of the early redemption of approximately $2.3 billion of senior notes during the three months ended July 29, 2022.

INCOME TAXES

	Three months ended
(in millions)	July 28, 2023			July 29, 2022
Income tax provision	$	400		$	112
Income before income taxes	1,196			1,044
Effective tax rate	33.4		%	10.7		%
Non-GAAP income tax provision	$	300		$	230
Non-GAAP income before income taxes	1,902			1,734
Non-GAAP Nominal Tax Rate	15.8		%	13.3		%
Difference between the effective tax rate and Non-GAAP Nominal Tax Rate	(17.6)		%	2.6		%

The Israeli Central-Lod District Court issued its decision in Medtronic Ventor Technologies Ltd (Ventor) v. Kfar Saba Assessing Office on June 1, 2023. The court determined that there was a deemed taxable transfer of intellectual property. As a result, the Company has recorded a $187 million income tax charge during the three months ended July 28, 2023. At this time, the Company is evaluating whether or not it will appeal the decision.

Our effective tax rate for the three months ended July 28, 2023 was 33.4%, as compared to 10.7% for the three months ended July 29, 2022. The increase in our effective tax rate primarily relates to an income tax reserve adjustment associated with the Ventor court decision discussed above, an increase in Puerto Rico withholding tax rates, and the benefit from the release of a valuation allowance during the three months ended July 29, 2022.

Our Non-GAAP Nominal Tax Rate for the three months ended July 28, 2023 was 15.8%, as compared to 13.3% for the three months ended July 29, 2022, respectively. The change in our Non-GAAP Nominal Tax Rate was primarily due to an increase in Puerto Rico withholding tax rates and year-over-year changes in operational results by jurisdiction. An increase in our Non-GAAP Nominal Tax Rate of 1 percent would result in an additional income tax provision for the three months ended July 28, 2023, of approximately $19 million.

LIQUIDITY AND CAPITAL RESOURCES

We are currently in a strong financial position, and we believe our balance sheet and liquidity as of July 28, 2023 provide us with flexibility, and our cash, cash equivalents, and current investments, along with our credit facility and related commercial paper programs will satisfy our foreseeable operating needs.

Our liquidity and capital structure are evaluated regularly within the context of our annual operating and strategic planning processes. We consider the liquidity necessary to fund our operations, which includes working capital needs, investments in research and development, property, plant, and equipment, and other operating costs. We also consider capital allocation alternatives that balance returning value to shareholders through dividends and share repurchases, satisfying maturing debt, and acquiring businesses and technology.

Summary of Cash Flows

The following is a summary of cash provided by (used in) operating, investing, and financing activities, the effect of exchange rate changes on cash and cash equivalents, and the net change in cash and cash equivalents:

	Three months ended
(in millions)	July 28, 2023		July 29, 2022
Cash provided by (used in):
Operating activities	$	875	$	1,083
Investing activities	(539)		(1,585)
Financing activities	(501)		(950)
Effect of exchange rate changes on cash and cash equivalents	(39)		(122)
Net change in cash and cash equivalents	$	(204)	$	(1,574)

Operating Activities The $208 million decrease in net cash provided was primarily driven by timing of payments to vendors. The decrease in net cash was partially offset by an increase in cash collected from customers and decrease in cash paid for income taxes. The

increase in cash collected from customers was primarily related to increase in sales and the decrease in cash paid for income taxes was due to estimated income tax payments.

Investing Activities The $1.0 billion decrease in cash used was primarily attributable to a decrease in cash paid for acquisitions of $1.2 billion, partially offset by an increase in net purchases of investments of $170 million, as compared to the corresponding period in the prior fiscal year.

Financing Activities There was a $449 million decrease in net cash used during the three months ended July 28, 2023, as compared to the corresponding period in the prior fiscal year, which is primarily attributable to the $500 million of commercial paper that was issued and outstanding at quarter end. In the first quarter of fiscal year 2023, the Company issued short-term borrowings of approximately $2.3 billion under the Fiscal 2023 Loan Agreement and used the proceeds to fund the early redemption of senior notes for total consideration of $2.3 billion. For more information on the commercial paper and Term Loan and redemption of senior notes, refer to the Debt and Capital section.

Debt and Capital

Our capital structure consists of equity and interest-bearing debt. We primarily utilize unsecured senior debt obligations to meet our financing needs and, to a lesser extent, bank borrowings. From time to time, we may repurchase our outstanding debt obligations in the open market or through privately negotiated transactions.

Total debt at July 28, 2023 was $25.0 billion as compared to $24.4 billion at April 28, 2023. The increase in total debt was driven by commercial paper outstanding of $500 million, as well as fluctuations in exchange rates.

In May 2022, we entered into a term loan agreement (Fiscal 2023 Loan Agreement) with Mizuho Bank, Ltd. for an aggregate principal amount of up to ¥300 billion with a term of 364 days. In May and June 2022, Medtronic Luxco borrowed an aggregate of ¥297 billion, or approximately $2.3 billion, of the term loan, under the Fiscal 2023 Loan Agreement. The Company used the net proceeds of the borrowings to fund the early redemption of $1.9 billion of Medtronic Inc. Senior Notes for $1.9 billion of total consideration, and $368 million of Medtronic Luxco Senior Notes for $376 million of total consideration. The Company recognized a total loss on debt extinguishment of $53 million within interest expense, net in the consolidated statements of income in the quarter ended July 29, 2022, which primarily included cash premiums and accelerated amortization of deferred financing costs and debt discounts and premiums. During the fourth quarter of fiscal year 2023, the Company repaid the term loan in full, including interest.

In September 2022, we issued four tranches of Euro-denominated Senior Notes with an aggregate principal of €3.5 billion, with maturities ranging from fiscal year 2026 to 2035, resulting in cash proceeds of approximately $3.4 billion, net of discounts and issuance costs. The Company used the net proceeds to repay at maturity €750 million of 0.000% Medtronic Luxco Senior Notes for $772 million of total consideration in December 2022 and €1.5 billion of 0.375% Medtronic Luxco Senior Notes and €1.25 billion of 0.000% Medtronic Luxco Senior Notes for $2.9 billion of total consideration in March 2023.

In March 2023, Medtronic Luxco issued two tranches of USD-denominated Senior Notes with an aggregate principal of $2.0 billion, with maturities ranging from 2028 to 2033, resulting in cash proceeds of approximately $2.0 billion, net of discounts and issuance costs. The Company used the net proceeds supplemented by additional cash to repay the ¥297 billion Fiscal 2023 Loan Agreement discussed above for $2.3 billion of total consideration.

We repurchase our ordinary shares on occasion as part of our focus on returning value to our shareholders. In March 2019, the Company's Board of Directors authorized the repurchase of $6.0 billion of the Company's ordinary shares. There is no specific time period associated with these repurchase authorizations. During the three months ended July 28, 2023, the Company repurchased a total of 2 million shares under this program at an average price of $87.35. At July 28, 2023, we had approximately $2.2 billion remaining under the share repurchase program authorized by our Board of Directors.

For more information on credit arrangements, refer to Note 7 to the current period's consolidated financial statements and Note 6 to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended April 28, 2023.

Liquidity

Our liquidity sources at July 28, 2023 included $1.3 billion of cash and cash equivalents and $6.5 billion of current investments. Additionally, we maintain commercial paper programs and a Credit Facility.

Our investments primarily include available-for-sale debt securities, including U.S. and non-U.S. government and agency securities, corporate debt securities, mortgage-backed securities, certificates of deposit, and other asset-backed securities. Refer to Note 6 to the current period's consolidated financial statements for additional information regarding fair value measurements.

We maintain multicurrency commercial paper programs for short-term financing, which allow us to issue unsecured commercial paper notes on a private placement basis up to a maximum aggregate amount outstanding at any time of $3.5 billion. At July 28, 2023 and April 28, 2023, we had $500 million and no commercial paper outstanding, respectively. The issuance of commercial paper reduces the amount of credit available under our existing line of credit, as explained below.

We also have a $3.5 billion five-year syndicated credit facility (Credit Facility), which expires in December 2027. At each anniversary date of the Credit Facility we can request a one-year extension of the maturity date. The Credit Facility provides backup funding for the commercial paper programs and may also be used for general corporate purposes. The Credit Facility provides us with the ability to increase our borrowing capacity by an additional $1.0 billion at any time during the term of the agreement. At July 28, 2023 and April 28, 2023, no amounts were outstanding under the Credit Facility.

Interest rates on advances of our Credit Facility are determined by a pricing matrix based on our long-term debt ratings assigned by Standard & Poor's Ratings Services (S&P) and Moody's Investors Service (Moody’s). Facility fees are payable on the Credit Facility and are determined in the same manner as the interest rates. We are in compliance with all covenants related to the Credit Facility.

The following table is a summary of our S&P and Moody's long-term debt ratings and short-term debt ratings:

	Agency Rating(1)
	July 28, 2023	April 28, 2023
Standard & Poor's Ratings Services
Long-term debt	A	A
Short-term debt	A-1	A-1
Moody's Investors Service
Long-term debt	A3	A3
Short-term debt	P-2	P-2

(1) Agency ratings are subject to change, and there may be no assurance that an agency will continue to provide ratings and/or maintain its current ratings. A security rating is not a recommendation to buy, sell or hold securities, and may be subject to revision or withdrawal at any time by the rating agency, and each rating should be evaluated independently of any other rating.

S&P and Moody's long-term debt ratings and short-term debt ratings at July 28, 2023 were unchanged as compared to the ratings at April 28, 2023. We do not expect the S&P and Moody's ratings to have a significant impact on our liquidity or future flexibility to access additional liquidity given our balance sheet, Credit Facility, and related commercial paper programs.

We have future contractual obligations and other minimum commercial commitments that are entered into in the normal course of business. We believe our off-balance sheet arrangements do not have a material current or anticipated future effect on our consolidated earnings, financial position, and/or cash flows. Refer to the Debt and Capital section above for changes in debt obligations during the first quarter of fiscal year 2024; there have been no other material changes to our long-term contractual obligations as reported in our most recent Annual Report filed on Form 10-K for the fiscal year ended April 28, 2023.

ACQUISITIONS

EOFlow Co. Ltd Acquisition

On May 25, 2023, the Company entered into a set of definitive agreements to acquire EOFlow Co. Ltd. (EOFlow), manufacturer of the EOPatch device – a tubeless, wearable, and fully disposable insulin delivery device. The acquisition expands the Diabetes segment portfolio of products. To the extent that all the public shares participate in the tender offer, the total consideration for the acquisition of the shares in EOFlow would be KRW 971 billion, or $760 million, at exchange rates on July 28, 2023. The acquisition is expected to close in the second half of calendar year 2023 subject to the satisfaction of the minimum tender condition and certain customary closing conditions, including receipt of required regulatory clearances.

Information regarding acquisitions is included in Note 4 to the current period's consolidated financial statements.

GOODWILL

We assess goodwill and indefinite-lived intangible assets for impairment annually in the third quarter of the fiscal year and whenever an event occurs or circumstances change that would indicate the carrying amount may be impaired. As further described in Note 10, we have certain new operating segments as of the beginning of fiscal year 2024. Goodwill reporting units were tested for impairment before and after the alignment. There was no impairment of goodwill in the current period as a result of the impairment test.

The goodwill allocation and the tests for impairment of goodwill requires us to make several estimates related to projected future cash flows to determine the fair value of the goodwill reporting units. We calculate the excess of each reporting unit's fair value over its carrying amount, including goodwill, utilizing a discounted cash flow analysis. The test for goodwill is based on future cash flows that require significant judgment with respect to future revenue and expense growth rates and discount rates. The discount rate applied to the cash flow analysis is based on the weighted average cost of capital (“WACC”) for each reporting unit. An impairment loss is recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit. A change in any of these estimates and assumptions could produce a different fair value, which could have a material impact on the our results of operations.

Definite-lived intangible assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount of an intangible asset (asset group) may not be recoverable. There were no impairments of intangible assets in the current period. Further adverse changes to macroeconomic conditions or significant changes to our current and future expected financial performance could lead to goodwill or intangible asset impairment charges in future periods, and such charges could be material to our results of operations.

CRITICAL ACCOUNTING ESTIMATES

We have used various accounting policies to prepare the consolidated financial statements in accordance with U.S. GAAP. Our significant accounting policies are disclosed in Note 1 to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended April 28, 2023.

The preparation of the consolidated financial statements, in conformity with U.S. GAAP, requires us to use judgment in making estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates reflect our best judgment about economic and market conditions and the potential effects on the valuation and/or carrying value of assets and liabilities based upon relevant information available. We base our estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

As of July 28, 2023, there were no material changes to our critical accounting estimates.

NEW ACCOUNTING PRONOUNCEMENTS

Information regarding new accounting pronouncements is included in Note 2 to the current period's consolidated financial statements.

SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION

Medtronic plc and Medtronic Global Holdings S.C.A. (Medtronic Luxco), a wholly-owned subsidiary guarantor, each have provided full and unconditional guarantees of the obligations of Medtronic, Inc., a wholly-owned subsidiary issuer, under the Senior Notes (Medtronic Senior Notes) and full and unconditional guarantees of the obligations of Covidien International Finance S.A. (CIFSA), a wholly-owned subsidiary issuer, under the Senior Notes (CIFSA Senior Notes). The guarantees of the CIFSA Senior Notes are in addition to the guarantees of the CIFSA Senior Notes by Covidien Ltd. and Covidien Group Holdings Ltd., both of which are wholly-owned subsidiary guarantors of the CIFSA Senior Notes. Medtronic plc and Medtronic, Inc. each have provided a full and unconditional guarantee of the obligations of Medtronic Luxco under the Senior Notes (Medtronic Luxco Senior Notes). The following is a summary of these guarantees:

Guarantees of Medtronic Senior Notes

•Parent Company Guarantor – Medtronic plc

•Subsidiary Issuer – Medtronic, Inc.

•Subsidiary Guarantor – Medtronic Luxco

Guarantees of Medtronic Luxco Senior Notes

•Parent Company Guarantor – Medtronic plc

•Subsidiary Issuer – Medtronic Luxco

•Subsidiary Guarantor – Medtronic, Inc.

Guarantees of CIFSA Senior Notes

•Parent Company Guarantor – Medtronic plc

•Subsidiary Issuer – CIFSA

•Subsidiary Guarantors – Medtronic Luxco, Covidien Ltd., and Covidien Group Holdings Ltd. (CIFSA Subsidiary Guarantors)

The following tables present summarized results of operations for the three months ended July 28, 2023 and summarized balance sheet information at July 28, 2023 and April 28, 2023 for the obligor groups of Medtronic and Medtronic Luxco Senior Notes, and CIFSA Senior Notes. The obligor group consists of the parent company guarantor, subsidiary issuer, and subsidiary guarantors for the applicable senior notes. The summarized financial information is presented after elimination of (i) intercompany transactions and balances among the guarantors and issuers and (ii) equity in earnings from and investments in any subsidiary that is a non-guarantor or issuer.

The summarized results of operations information for the three months ended July 28, 2023 was as follows:

(in millions)	Medtronic & Medtronic Luxco Senior Notes (1)		CIFSA Senior Notes (2)
Net sales	$	822	$	—
Operating profit (loss)	(538)		14
Loss before income taxes	(1,077)		(585)
Net loss attributable to Medtronic	(921)		(582)

The summarized balance sheet information at July 28, 2023 was as follows:

(in millions)	Medtronic & Medtronic Luxco Senior Notes (1)		CIFSA Senior Notes (2)
Total current assets(3)	$	21,748	$	8,591
Total noncurrent assets(4)	5,968		11
Total current liabilities(5)	34,489		27,164
Total noncurrent liabilities	60,256		67,062
Noncontrolling interests	188		188

(1)The Medtronic Senior Notes and Medtronic Luxco Senior Notes obligor group consists of the following entities: Medtronic plc, Medtronic Luxco, and Medtronic, Inc. Refer to the guarantee summary above for further details.

(2)The CIFSA Senior Notes obligor group consists of the following entities: Medtronic plc, Medtronic Luxco, CIFSA, and CIFSA Subsidiary Guarantors. Refer to the guarantee summary above for further details.

(3)Includes receivables due from non-guarantor subsidiaries of $20.9 billion and $8.4 billion for Medtronic & Medtronic Luxco Senior Notes, and CIFSA Senior Notes, respectively.

(4)Includes loans receivable due from non-guarantor subsidiaries of $20.0 million for Medtronic & Medtronic Luxco Senior Notes. No loans receivable due from non-guarantor subsidiaries for CIFSA Senior Notes.

(5)Includes payables due to non-guarantor subsidiaries of $32.2 billion and $26.4 billion for Medtronic & Medtronic Luxco Senior Notes, and CIFSA Senior Notes, respectively.

(6)Includes loans payable due to non-guarantor subsidiaries of $33.6 billion and $47.2 billion for Medtronic & Medtronic Luxco Senior Notes, and CIFSA Senior Notes, respectively.

The summarized balance sheet information at April 28, 2023 was as follows:

(in millions)	Medtronic & Medtronic Luxco Senior Notes (1)		CIFSA Senior Notes (2)
Total current assets(3)	$	23,198	$	8,344
Total noncurrent assets(4)	5,897		3
Total current liabilities(5)	33,854		25,184
Total noncurrent liabilities(6)	59,624		66,449
Noncontrolling interests	182		182

(1)The Medtronic Senior Notes and Medtronic Luxco Senior Notes obligor group consists of the following entities: Medtronic plc, Medtronic Luxco, and Medtronic, Inc. Refer to the guarantee summary above for further details.

(2)The CIFSA Senior Notes obligor group consists of the following entities: Medtronic plc, Medtronic Luxco, CIFSA, and CIFSA Subsidiary Guarantors. Refer to the guarantee summary above for further details.

(3)Includes receivables due from non-guarantor subsidiaries of $22.5 billion and $8.3 billion for Medtronic & Medtronic Luxco Senior Notes, and CIFSA Senior Notes, respectively.

(4)Includes loans receivable due from non-guarantor subsidiaries of $20.0 million for Medtronic & Medtronic Luxco Senior Notes. No loans receivable due from non-guarantor subsidiaries for CIFSA Senior Notes.

(5)Includes payables due to non-guarantor subsidiaries of $31.8 billion and $25.0 billion for Medtronic & Medtronic Luxco Senior Notes, and CIFSA Senior Notes, respectively.

(6)Includes loans payable due to non-guarantor subsidiaries of $33.1 billion and $46.7 billion for Medtronic & Medtronic Luxco Senior Notes, and CIFSA Senior Notes, respectively.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, and other written reports and oral statements made by or with the approval of one of the Company’s executive officers from time to time, may include “forward-looking” statements. All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and financial position, business strategy and plans, objectives of management for future operations and current expectations or forecasts of future results, are forward-looking statements. These statements involve known and unknown risks, uncertainties, and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. Our forward-looking statements may include statements related to our growth and growth strategies, developments in the markets for our products, therapies and services, financial results, product development launches and effectiveness, research and development strategy, regulatory approvals, competitive strengths, the potential or anticipated direct or indirect impact of public health crises on our business, results of operations, and/or financial condition, restructuring and cost-saving initiatives, intellectual property rights, litigation and tax matters, governmental proceedings and investigations, mergers and acquisitions, divestitures, market acceptance of our products, therapies and services, accounting estimates, financing activities, ongoing contractual obligations, working capital adequacy, value of our investments, our effective tax rate, our expected returns to shareholders, and sales efforts. In some cases, such statements may be identified by the use of terminology such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “intend,” “looking ahead,” “may,” “plan,” “possible,” “potential,” “project,” “should,” “will,” and similar words or expressions. Forward-looking statements in this Quarterly Report include, but are not limited to, statements regarding our ability to drive long-term shareholder value, development and future launches of products and continued or future acceptance of products, therapies and services in our segments; expected timing for completion of research studies relating to our products; market positioning and performance of our products, including stabilization of certain product markets; divestitures and the potential benefits thereof; the costs and benefits of integrating previous acquisitions; anticipated timing for United States (U.S.) Food and Drug Administration (U.S. FDA) and non-U.S. regulatory approval of new products; increased presence in new markets, including markets outside the U.S.; changes in the market and our market share; acquisitions and investment initiatives, including the timing of regulatory approvals as well as integration of acquired companies into our operations; the resolution of tax matters; the effectiveness of our development activities in reducing patient care costs and hospital stay lengths; our approach towards cost containment; our expectations regarding healthcare costs, including potential changes to reimbursement policies and pricing pressures; our expectations regarding changes to patient standards of care; our ability to identify and maintain successful business partnerships; the elimination of certain positions or costs related to restructuring initiatives; outcomes in our litigation matters and governmental proceedings and investigations; general economic conditions; the adequacy of available working capital and our working capital needs; our payment of dividends and redemption of shares; the continued strength of our balance sheet and liquidity; our accounts receivable exposure; and the potential impact of our compliance with governmental regulations and accounting guidance.

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, results of operations, financial condition, and/or cash flows. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to a number of risks, uncertainties and assumptions described in the “Risk Factors” section and elsewhere in our Annual Report on Form 10-K. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. One must carefully consider forward-looking statements and understand that such forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, and involve a variety of risks and uncertainties, known and unknown, including, among others, those discussed in the sections entitled “Government Regulation” within “Item 1. Business” and “Item 1A. Risk Factors” in our Annual Report on Form 10-K, as well as those related to:

•competition in the medical device industry;

•delays in regulatory approvals;

•public health crises;

•reduction or interruption in our supply;

•failure to complete or achieve the intended benefits of acquisitions or divestitures;

•adverse regulatory action;

•laws and governmental regulations;

•litigation results;

•quality problems;

•healthcare policy changes;

•cybersecurity incidents;

•international operations, including the impact of armed conflicts;

•self-insurance;

•commercial insurance;

•changes in applicable tax rates;

•positions taken by taxing authorities;

•decreasing selling prices and pricing pressure;

•liquidity shortfalls;

•fluctuations in currency exchange rates;

•inflation; or

•disruption of our current plans and operations.

Consequently, no forward-looking statement may be guaranteed, and actual results may vary materially from those projected in the forward-looking statements. We intend to take advantage of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 regarding our forward-looking statements and are including this sentence for the express purpose of enabling us to use the protections of the safe harbor with respect to all forward-looking statements. While we may elect to update these forward-looking statements at some point in the future, whether as a result of any new information, future events, or otherwise, we have no current intention of doing so except to the extent required by applicable law.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

CURRENCY EXCHANGE RATE RISK

Due to the global nature of our operations, we are exposed to currency exchange rate changes, which may cause fluctuations in earnings and cash flows. Fluctuations in the currency exchange rates of currency exposures that are unhedged, such as in certain emerging markets, may result in future earnings and cash flow volatility. The gross notional amount of all currency exchange rate derivative instruments outstanding at July 28, 2023 and April 28, 2023 was $22.9 billion and $22.0 billion, respectively. At July 28, 2023, these contracts were in a net unrealized gain position of $91 million. Additional information regarding our currency exchange rate derivative instruments is included in Note 8 to the current period's consolidated financial statements.

A sensitivity analysis of changes in the fair value of all currency exchange rate derivative contracts at July 28, 2023 indicates that, if the U.S. dollar uniformly strengthened/weakened by 10 percent against all currencies, the fair value of these contracts would increase/decrease by approximately $1.6 billion. Any gains and losses on the fair value of derivative contracts would generally be offset by gains and losses on the underlying transactions. These offsetting gains and losses are not reflected in the above analysis.

INTEREST RATE RISK

We are subject to interest rate risk on our short-term investments and our borrowings. We manage interest rate risk in the aggregate, while focusing on our immediate and intermediate liquidity needs. Our debt portfolio at July 28, 2023 was comprised of debt predominantly denominated in U.S. dollars and Euros, of which substantially all is fixed rate debt. We are also exposed to interest rate changes affecting our investments in interest rate sensitive instruments, which include our marketable debt securities.

A sensitivity analysis of the impact on our interest rate-sensitive financial instruments of a hypothetical 50 basis point change in interest rates, as compared to interest rates at July 28, 2023, indicates that the fair value of these instruments would correspondingly change by $61 million.

For a discussion of current market conditions and the impact on our financial condition and results of operations, please see the “Liquidity” section of the current period's Management's Discussion and Analysis. For additional discussion of market risk, refer to Notes 6 and 8 to the current period's consolidated financial statements.

Item 4. Controls and Procedures

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) and changes in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) are effective.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) under the Exchange Act) during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

In accordance with Item 103 of Regulation S-K, we have adopted a $1 million disclosure threshold for proceedings under environmental laws to which a governmental authority is a party, as we believe matters under this threshold are not material to the Company. A discussion of the Company’s legal proceedings and other loss contingencies are described in Note 16 to the current period's consolidated financial statements.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

The following table provides information about the shares repurchased by the Company during the first quarter of fiscal year 2024:

Fiscal Period	Total Number of<br>Shares Purchased	Average Price<br>Paid per Share		Total Number of Shares<br>Purchased as a Part of<br>Publicly Announced<br>Program	Maximum Approximate Dollar Value of Shares that may yet be Purchased Under the Program
4/29/2023-5/26/2023	357,800	$	89.35	357,800	$	2,346,149,738
5/27/2023-6/30/2023	551,200	85.79		551,200	2,298,859,931
7/1/2023-7/28/2023	787,668	87.52		787,668	2,229,920,199
Total	1,696,668	$	87.35	1,696,668	$	2,229,920,199

In March 2019, the Company's Board of Directors authorized the repurchase of $6.0 billion of the Company's ordinary shares. There is no specific time period associated with these repurchase authorizations.

Item 5. Other Information

Medtronic has engaged in certain activities that it is required to disclose pursuant to Section 13(r)(1)(D)(ii) of the Securities Exchange Act of 1934, as amended. In particular, during the first quarter of fiscal year 2024, Medtronic engaged in certain regulatory activities involving Russia’s Federal Security Service (“FSB”) related to its medical devices that were expressly authorized by the U.S. Government under applicable economic sanctions regulations.

During the first quarter of fiscal year 2024 ending July 28, 2023, in the normal course of business and consistent with Office of Foreign Assets Control authorizations as in effect at the time, Medtronic Russia filed one notification with the FSB, as required under local Russian law for the import of medical devices that make use of encryption functionality. This activity did not directly result in any revenues or profits for Medtronic. To the extent that notifications with the FSB remain permissible under U.S. law, Medtronic may decide to continue engaging in such activities for the limited purposes of complying with local law requirements in Russia.

Rule 10b5-1 Director and Officer Trading Arrangements

During the three months ended July 28, 2023, certain of our officers and directors adopted “Rule 10b5-1 trading arrangements,” intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act as follows.

On July 14, 2023, Karen L. Parkhill, Executive Vice President and Chief Financial Officer, adopted a Rule 10b5-1 trading plan. Ms. Parkhill’s trading plan provides for the sale of up to 3,351 shares of the Company’s common stock prior to the plan's August 30, 2024 termination date.

Item 6. Exhibits

(a)	Exhibits
	10.1	Performance ShareUnitAwardAgreementmdt-2024q110qxex101.htm2021Medtronicplc Long Term Incentive Plan
	10.2	Restricted Stock Unit Award Agreement 2021 Medtronic plc Long Term Incentive Plan
	10.3	Restricted Stock Unit Award Agreement 2021 Medtronic plc Long Term Incentive Plan
	10.4	Non-Qualified Stock Option Agreement 2021 Medtronic plc Long Term Incentive Plan
	31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	101.SCH	Inline XBRL Schema Document.
	101.CAL	Inline XBRL Calculation Linkbase Document.
	101.DEF	Inline XBRL Definition Linkbase Document.
	101.LAB	Inline XBRL Label Linkbase Document.
	101.PRE	Inline XBRL Presentation Linkbase Document.
	104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned authorized officer.

		Medtronic plc
		(Registrant)
Date:	August 31, 2023	/s/ Jennifer M. Kirk
		Jennifer M. Kirk
		Senior Vice President, Global Controller and Chief Accounting Officer (Principal Accounting Officer)

50

Document

MEDTRONIC plc

PERFORMANCE SHARE UNIT AWARD AGREEMENT 2021 MEDTRONIC PLC LONG TERM INCENTIVE PLAN

Name:

Employee ID:

Client Grant ID:

Grant Date:

Grant Price:

Grant Type:

Target PERFORMANCE SHARE UNITS:

Performance Period: FY2023 to FY2025 (“Performance Period”)

1.Performance Share Unit Award. Medtronic plc, an Irish public limited company (“Medtronic” or the “Company”), hereby grants to the individual named above (“you”) an Award (the “Award”) consisting of Performance Share Units (“Performance Share Units”) in the target number (“Target Performance Share Units”) and on the Grant Date as each is set forth above. The actual number of Performance Share Units that will be earned if the minimum performance threshold is achieved is illustrated in Section 2 below. Each Performance Share Unit represents the right to receive one ordinary share of the Company, par value $0.0001 per share (“Share”), subject to the restrictions, limitations, and conditions contained in this Performance Share Unit Award Agreement (the “Agreement”) and in the 2021 Medtronic plc Long Term Incentive Plan (the “Plan”). In the event of any inconsistency between the terms of the Agreement and the Plan, the terms of the Plan shall govern. Capitalized terms used but not defined shall have the meaning ascribed thereto in the Plan.

2.Performance Targets. The payout under this Award will be based on the following pre-established performance targets over the 3-year Performance Period:

a)Company performance will be measured using three criteria: Revenue Growth (“Revenue Growth”), Relative Total Shareholder Return (“Relative TSR”), and a 3-year Return on Invested Capital modifier (“ROIC Modifier”) as shown below. The performance measures will be weighted as follows: Revenue Growth weighted 50.00%, Relative TSR weighted 50.00%. The ROIC Modifier may be applied to reduce (but not increase) the number of Performance Share Units that are paid out. This means the number of Performance Share Units paid out may be greater than, equal to, or less than the target number of Performance Share Units awarded at grant due to actual performance relative to these performance measures.

1

21PU

Revenue Growth<br><br>Performance Range	0%	1%	2%	3%	4%	5%	6%	7%	8%	9%	≥10%
Payout Range	50%	60%	70%	80%	90%	100%	120%	140%	160%	180%	200%
Relative TSR<br><br>Performance Range	25%	30%	35%	40%	45%	50%	55%	60%	65%	70%	≥75%
---	---	---	---	---	---	---	---	---	---	---	---
Payout Range	50%	60%	70%	80%	90%	100%	120%	140%	160%	180%	200%

FY2023 – FY2025 Return on Invested Capital (“ROIC”)

The ROIC Modifier will reduce the PSU Payout Factor by 30% if the 3-fiscal year ROIC does not meet a minimum of 10% for the FY2023-FY2025 Performance Period.

The tables above show the percentage of the Target Performance Share Units to be earned based on the actual Company performance against these three criteria over the FY2023 – FY2025 Performance Period.

b)To determine payout, the percentage across the top of the grid is earned based on achievement of performance targets within the grid for each of the performance measures, multiplied by the weight. Next, the ROIC Modifier is applied to determine the final number of earned Performance Share Units. To illustrate:

i) if Company performance results in Revenue Growth of 7%, Relative TSR of 55% and ROIC of 10.0%, the % payout of Target Performance Share Units would be calculated as follows:

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Performance Measure	% Award Earned	Weight
Revenue Growth	140% x	50.00%	= 70.00%
Relative TSR	120% x	50.00%	= 60.00%
% Payout of Target Performance<br><br>Share Units (Before ROIC Modifier)			= 130.00%
ROIC Modifier	30% Reduction if ROIC<br><br>target not achieved		No Reduction
% Payout of Target Performance<br><br>Share Units (After ROIC Modifier)			= 130.00%

ii) if Company performance results in Revenue Growth of 7%, Relative TSR of 55% and ROIC of 8.0%, the % payout of Target Performance Share Units would be calculated as follows:

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Performance Measure	% Award Earned	Weight
Revenue Growth	140% x	50.00%	= 70.00%
Relative TSR	120% x	50.00%	= 60.00%
% Payout of Target Performance<br><br>Share Units (Before ROIC Modifier)			= 130.00%
ROIC Modifier	30% Reduction if ROIC<br><br>target not achieved		= -30.00%
% Payout of Target Performance<br><br>Share Units (After ROIC Modifier)			= 100.00%

3.Calculation of Revenue Growth, Relative TSR and the ROIC Modifier

Revenue Growth Performance Target

“Revenue Growth” is defined as Medtronic’s 3-year simple average annual organic revenue growth measured at constant currency. Each fiscal year’s growth is measured independently and then averaged. Organic Constant Currency growth excludes the 1st year of material acquisitions.

Relative TSR Performance Target

“Relative TSR” is defined as (end average share price x re-investment factor) -1 x 100 divided by the start average share price. The re-investment factor equals the cumulative number of dividend shares divided by one share.

Return on Invested Capital Performance Modifier

“Return on Invested Capital (“ROIC”) is defined as Net Cash Earnings plus Interest Expense net of Tax, divided by Invested Capital for each year, averaged over the 3-year period. “Net Cash Earnings” is defined as non-GAAP earnings (adjusted to exclude the impact of non-recurring items) after the removal of the after-tax impact of Amortization. “Invested Capital” is defined as Total Equity plus Interest-Bearing Liabilities Less Cash and Cash Equivalents for each year. The ROIC modifier will reduce the PSU Payout Factor by 30% if the 3-fiscal year ROIC does not meet a minimum of 10% for the FY2023-FY2025 PSU Performance Period. The ROIC PSU Performance modifier cannot increase the PSU payout factor.

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4.Vesting & Distribution. The Performance Share Units, to the extent earned based on attainment of the performance measures as determined by the Compensation Committee in accordance with Section 2 above, will fully vest on the last day of the Performance Period, provided that you have not incurred a Termination of Employment during the period beginning on the Grant Date and ending on the last day of the Performance Period (the “Vesting Period”), and in no event later than two and one-half months after the end of the calendar year in which the end of the Vesting Period occurs. The Company will issue to you a number of Shares equal to the number of Performance Share Units that are earned (including any dividend equivalents described in Section 7, below) as soon as practicable following the end of the Vesting Period. Notwithstanding the preceding sentence, if you incur a Termination of Employment during the Vesting Period as a result of your death, Disability or Retirement (other than if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs, as provided in Section 5 below), you will remain entitled to receive a number of Shares equal to the number of Performance Share Units that are earned (including any dividend equivalents described in Section 7, below) based on actual performance over the 3-fiscal year Performance Period, as soon as practicable following the end of the Vesting Period, and in no event later than two and one-half months after the end of the calendar year in which the end of the Vesting Period occurs. Upon your Termination of Employment during the Vesting Period for any reason other than death, Disability or Retirement, including a Termination of Employment during the Vesting Period that results from your Retirement on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs, the Performance Share Units will automatically be forfeited in full and canceled by the Company as of 11:00 p.m. CT (midnight ET) on the date of such Termination of Employment. For purposes of this Agreement, the term “Disability” shall have the meaning ascribed to it under the Global Disability Policy maintained by the Committee or its delegate and the term “Retirement” shall mean the earlier of: (i) Termination of Employment from the Company or an Affiliate on or after attaining age 55 with 10 years of service; (ii) Termination of Employment on or after attaining age 62; or (iii) if, on your termination date, you are employed in a country (i.e., receiving pay and benefits from that country) that is designated on the Global Retirement Policy maintained by the Committee or its delegate, the age or combination of age and service specifically for such country on the Global Retirement Policy.

5.Forfeiture. If you have received or are entitled to receive delivery of Shares as a result of this Agreement within the period beginning six months prior to the date of your Termination of Employment and ending twelve months following the date of your Termination of Employment, the Company, in its sole discretion, may require you to return or forfeit the cash and/or Shares received or receivable with respect to this Performance Share Unit Award, in the event that you engage in any of the following activities:

a.performing services for or on behalf of any competitor of, or competing with, the Company or any Affiliate, within six months of the date of your Termination of Employment;

b.unauthorized disclosure of material proprietary information of the Company or any Affiliate;

c.a violation of applicable business ethics policies or business policies of the Company or any Affiliate; or

d.any other occurrence determined by the Committee.

The Company’s right to require forfeiture must be exercised not later than 90 days after the Company acquires actual knowledge of such an activity but in no event later than twelve

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months after your Termination of Employment. Such right shall be deemed to be exercised upon the Company’s mailing written notice of such exercise to your most recent home address as shown on the personnel records of the Company. In addition to requiring forfeiture as described herein, the Company may exercise its rights under this Section 5 by terminating the Performance Share Units awarded under this Agreement.

If you fail or refuse to forfeit the cash and/or shares of Common Stock demanded by the Company (the number of such shares of Common Stock as may be adjusted for any events described in Section 3.4 of the Plan), you shall be liable to the Company for damages equal to the number of Shares demanded times the highest closing price per share of the Common Stock during the period between the date of your Termination of Employment and the date of any judgment or award to the Company, together with all costs and attorneys’ fees incurred by the Company to enforce this provision.

For purposes of this Section 5, forfeiture of Common Stock shall be effected by the redemption of such Common Stock in accordance with the Articles of Association of the Company and to the extent permissible under applicable law.

Notwithstanding the foregoing, this Section 5 shall have no application following a Change of Control, nor shall the Company’s Incentive Compensation Forfeiture Policy apply following a Change of Control to the Performance Share Units awarded pursuant to this Agreement or to any proceeds in respect of such Award.

In addition to the foregoing, the Performance Share Units will terminate upon the date of your Retirement, and you will forfeit the continued vesting described in Section 4 that may otherwise apply to a Termination of Employment as a result of Retirement, if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs.

6.Change of Control. Notwithstanding anything in Section 4 of this Agreement to the contrary, if a Change of Control of the Company occurs during the Vesting Period, then the Performance Share Units will become 100% vested upon such Change of Control, and the Company will issue to you a number of Shares equal to the Target Performance Share Units (including any dividend equivalents described in Section 7, below) within six weeks following the Change of Control (unless such Change of Control is not an event described in Section 409A(a)(2)(A)(v) of the Code and the regulations thereunder (a “Section 409A Change of Control”), in which case such settlement shall be delayed until the Delayed Payment Date (as defined below)), provided that no such vesting or issuance shall occur if the Performance Share Units are replaced or continued by a Replacement Award that satisfies the requirements of Section 10.1(b) of the Plan. In the event that the Performance Share Units are replaced by a Replacement Award and you incur a Termination of Employment during the two years following a Change of Control by the Company without Cause or by you for Good Reason, such Replacement Award shall vest in full and be settled on the Delayed Payment Date. For purposes of this Agreement, the Delayed Payment Date means the first to occur of: (i) the date on which you incur a “separation from service” (within the meaning of Section 409A of the Code), or, if you are a “specified employee” (within the meaning of Section 409A(a)(2)(B)(i) of the Code) at the time of such “separation from service,” on the date that is six months following the date of your “separation from service”; (ii) the originally scheduled vesting date for the applicable Performance Share Units; (iii) the date of your death; and (iv) the date of a Section 409A Change of Control.

7.Dividend Equivalents. You are entitled to receive dividend equivalents on the Performance Share Units generally in the same manner and at the same time as if each Performance Share Unit were a Share. These dividend equivalents will be credited to you in the form of

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additional Performance Share Units. The additional Performance Share Units will be subject to the terms of this Agreement.

8.Clawback; Repayment. The Performance Share Units shall be subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with (i) any clawback, forfeiture or other similar policy adopted by the Board or the Committee and as in effect from time to time, and (ii) applicable law. In addition, if you receive any amount in excess of the amount that you should have otherwise received under the terms of the Performance Share Units for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), the Committee may provide that you shall be required to repay any such excess amount to the Company and its Subsidiaries.

9.Withhold Taxes. You are responsible to promptly pay any Social Security and Medicare taxes (together, “FICA”) due upon vesting of the Performance Share Units, and any Federal, State, and local taxes due upon distribution of the Shares. The Company and its Subsidiaries are authorized to deduct from any payment to you any such taxes required to be withheld. As described in Section 15.4 of the Plan and to the extent permissible under applicable law, you may elect to have the Company withhold a portion of the Shares issued upon settlement of the Performance Share Units to satisfy all or part of the withholding tax requirements. You may also elect, at the time you vest in the Performance Share Units, to pay your FICA liability due with respect to those Performance Share Units out of those units. If you choose to do so, the Company will reduce the number of your vested Performance Share Units accordingly. The amount that is applied to pay FICA will be subject to Federal, State, and local taxes.

10.Limitation of Rights. Except as set forth in the Agreement, until the Shares are issued to you in settlement of your Performance Share Units, you do not have any right in, or with respect to, any Shares (including any voting rights) by reason of this Agreement. Further, you may not transfer or assign your rights under the Agreement and you do not have any rights in the Company’s assets that are superior to a general, unsecured creditor of the Company by reason of this Agreement.

11.No Employment Contract. Nothing contained in the Plan or Agreement creates any right to your continued employment or otherwise affects your status as an employee at will. You hereby acknowledge that the Company and you each have the right to terminate your employment at any time for any reason or for no reason at all.

12.Amendment to Agreement Under Section 409A of the Code. You acknowledge that the Agreement and the Plan, or portions thereof, may be subject to Section 409A of the Code, and that changes may need to be made to the Agreement to avoid adverse tax consequences under Section 409A of the Code. You agree that following the issuance of such rules, the Company may amend this Agreement as it deems necessary or desirable to avoid such adverse tax consequences; provided, however, that the Company shall accomplish such amendments in a manner that preserves your intended benefits under the Agreement to the greatest extent possible.

13.Governing Law, Venue and Personal Jurisdiction. Notwithstanding anything contrary in the Plan or Section 13 of this Agreement, the validity, enforceability, construction and interpretation of the Plan or Agreement shall be governed by the laws of the State of Minnesota. You irrevocably waive any right to have the laws of any state or nation or other legal jurisdiction other than the State of Minnesota apply to the Plan or Agreement. Any dispute regarding the Plan or Agreement that is not subject to Section 13 or is allowed to be brought in court pursuant to Section 13 (“Permitted Court Action”) shall be exclusively decided by a state court in the State of Minnesota, and you irrevocably waive any right to have any such disputes decided in any jurisdiction or venue other than a state court in the State of Minnesota. You irrevocably consent to the personal jurisdiction of the state courts in the State of Minnesota for the purposes of any Permitted Court Action, and irrevocably waive

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any right to remove any case commenced by Medtronic from a state court in the State of Minnesota to any federal court.

14.If you are a U.S. based employee, this Section 13 contains the terms and conditions of an agreement to arbitrate claims (“Arbitration Agreement”) between you and Medtronic. The Federal Arbitration Act (“FAA”) (9 U.S.C. §1 et. seq.) applies to and governs this Arbitration Agreement. All claims and disputes covered by this Arbitration Agreement will be decided by a single arbitrator through final and binding arbitration and not by way of court or jury trial.

a.Covered Claims. You and Medtronic agree that, except as otherwise provided in this Arbitration Agreement, all claims or disputes, past, present, or future, arising out of or related to: (i) this Agreement, (ii) the Award, or (iii) the Plan (including, without limitations, claims for breach of contract, breach of fiduciary duty, and claims for violation of any federal, state, or other governmental law, statute, regulation, or ordinance) will be decided by a single arbitrator through final and binding arbitration under the terms of this Arbitration Agreement. This arbitration Agreement applies to any disputes that the Company may have against you or that you may have against the Company, and/or any of its past, present, or future: (i) officers, directors, members, owners, shareholders, employees, and board members; (ii) parents, subsidiaries, and affiliates; and (iii) Plan Administrators and Committee members or Committees (as those terms are defined in the Plan); and (iv) predecessors, successors, or assigns. Each and all of the entities/individuals listed in the preceding sentence may enforce this Arbitration Agreement as a direct or third-party beneficiary. If any claim(s) not covered under this Arbitration Agreement are combined with claims that are covered under this Arbitration Agreement, to the maximum extent permitted under applicable law, the covered claims will be arbitrated and continue to be covered under this Arbitration Agreement.

b.The arbitrator, and not any federal, state, or local court or agency, shall have exclusive authority to resolve any dispute relating to the scope, interpretation, applicability, enforceability, or waiver of this Arbitration Agreement. However, the preceding sentence does not apply to Section 13(e) of this Arbitration Agreement. Notwithstanding any other clause or language in this Arbitration Agreement and/or any rules or procedures that might otherwise apply by virtue of this Arbitration Agreement, any claim that all or any portion of the Class Action Waiver is unenforceable, inapplicable, unconscionable, or void or voidable, will be determined only by a court of competent jurisdiction and not by an arbitrator.

c.Limitations. This Arbitration Agreement does not cover any claims or disputes that an applicable federal statute expressly states cannot be arbitrated or subject to a pre-dispute arbitration agreement. Both the Company and you may apply to a court of competent jurisdiction as permitted in this Arbitration Agreement for temporary or preliminary injunctive relief in connection with an arbitrable controversy, but only upon the ground that the award to which that party may be entitled may be rendered ineffectual without such relief. The court to which the application is made is authorized to grant temporary or preliminary injunctive relief and may do so with or without addressing the merits of the underlying arbitrable dispute, as provided by applicable law of the jurisdiction. All determination of final relief will be decided in arbitration, and the pursuit of temporary or preliminary injunctive relief shall not be deemed incompatible with or constitute a waiver of rights under this Arbitration Agreement.

d.Procedures. The arbitration will be administered by the American Arbitration Association (“AAA”), and except as provided in this Arbitration Agreement, will

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be under the then current Commercial Arbitration Rules of the AAA (“AAA Rules”); provided, however, that if there is a conflict between the AAA Rules and this Arbitration Agreement, this Arbitration Agreement shall govern. Unless the parties jointly agree otherwise, the arbitrator must be a retired judge from any jurisdiction. Unless the parties jointly agree otherwise, the arbitration will take place in the county where you are employed or were last employed by the Company.

i.The arbitrator will be selected as follows: AAA will give each party a list of 11 potential arbitrators (who are subject to the qualifications of the preceding paragraph) drawn from its panel of arbitrators from which the parties will strike alternately by telephone conference administered by AAA, with the claimant to strike first, until only one name remains. That person will be designated as the arbitrator. If the individual selected cannot serve, AAA will issue another list of 11 potential arbitrators and repeat the alternate striking selection process. If AAA will not administer the arbitration, either party may apply to a court of competent jurisdiction with authority over the location where the arbitration will be conducted to appoint a neutral arbitrator, who shall act under this Arbitration Agreement with the same force and effect as if he or she had been specifically named herein.

ii.The arbitrator may award any remedy to which a party is entitled under applicable law, but remedies will be limited to those that would be available to a party in their individual capacity for the claims presented to the arbitrator. Either party may file dispositive motions, including without limitation a motion to dismiss and/or a motion for summary judgment and the arbitrator will apply the standards governing such motions under the Federal Rules of Civil Procedure. A party may make an offer of judgment in a manner consistent with, and within the time limitations, consequences, and effects provided in Rule 68 of the Federal Rules of Civil Procedure.

iii.The arbitrator will issue an award by written opinion within thirty (30) days from the date the arbitration hearing concludes. The opinion will be in writing and include the factual and legal basis for the award. The award issued by the arbitrator may be entered in any court of competent jurisdiction.

e.Class and Collective Action Waivers. You and the Company agree to bring any claim on an individual basis. Accordingly, YOU AND THE COMPANY WAIVE ANY RIGHT FOR ANY DISPUTE TO BE BROUGHT, HEARD, DECIDED OR ARBITRATED AS A CLASS ACTION AND/OR COLLECTIVE ACTION AND THE ARBITRATOR WILL HAVE NO AUTHORITY TO HEAR OR PRESIDE OVER ANY CLASS AND/OR COLLECTIVE ACTION (“Class Action Waiver”). Additionally, no arbitration proceeding under this Arbitration Agreement may be consolidated or joined in any way with an arbitration proceeding involving claims by different employees. The Class Action Waiver will be severable from this Arbitration Agreement if there is a final judicial determination that the Class Action Waiver is invalid, unenforceable, unconscionable, void, or voidable. In such case, the class and/or collective action must be litigated in a civil court of competent jurisdiction—not in arbitration—but any portion of the Class Action Waiver that is enforceable shall be enforced in arbitration.

f.Discovery. Each party may take the deposition of 3 individual fact witnesses and any expert witness designated by another party. Each party may also propound

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requests for production of documents, and each party may subpoena witnesses and documents for discovery or the arbitration hearing, including testimony and documents relevant to the case from third parties, in accordance with any applicable state or federal law. Additional discovery may be conducted by mutual stipulation, and the arbitrator will have exclusive authority to entertain requests for additional discovery, and to grant or deny such requests, based on the arbitrator’s determination whether additional discovery is warranted by the circumstances of a particular case.

g.Construction. Subject to Section 13(e) of this Arbitration Agreement, which includes its own severability provision, if any provision of this Arbitration Agreement is adjudged to be invalid, unenforceable, unconscionable, or void or voidable, in whole or in part, such adjudication will not affect the validity of the remainder of the Arbitration Agreement. All remaining provisions will remain in full force and effect. The mutual promises by the Company and you to arbitrate provide consideration for this Arbitration Agreement. Your entitlement to an Award provides additional and separate consideration for this Arbitration Agreement. Any contractual disclaimers the Company has in any handbooks, other agreements, or policies do not apply to this Arbitration Agreement. Notwithstanding any contrary language in the Agreement or otherwise, this Arbitration Agreement will survive the termination of the Agreement, the Plan, your employment and the expiration of any benefit.

15.Agreement. By accepting your stock grant electronically on the administrator’s website or otherwise accepting or receiving the stock grant, you agree to be bound by the terms and conditions of this Agreement and the Plan, including, without limitation, the Arbitration Agreement. Your signature is not required in order to make this Agreement effective.

Medtronic Stock Administration

Medtronic plc

c/o Medtronic, Inc.

800 53rd Ave NE #SLK32

Minneapolis, MN 55432

askhr@medtronic.com

888-422-1500

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Document

MEDTRONIC plc

RESTRICTED STOCK UNIT AWARD AGREEMENT 2021 MEDTRONIC PLC LONG TERM INCENTIVE PLAN

Name:

Employee ID:

Client Grant ID:

Grant Date:

Grant Price:

Grant Type:

Shares Awarded:

1.Restricted Stock Units Award. Medtronic plc, an Irish public limited company (the “Company”), hereby awards to the individual named above Restricted Stock Units, in the number and on the Grant Date as each is set forth above. The Restricted Stock Units represent the right to receive ordinary shares of the Company, par value $0.0001 per share (the “Shares”), subject to the restrictions, limitations, and conditions contained in this Restricted Stock Unit Award Agreement (the “Agreement”) and in the 2021 Medtronic plc Long Term Incentive Plan (the “Plan”). Unless otherwise defined in the Agreement, a capitalized term in the Agreement will have the same meaning as in the Plan. In the event of any inconsistency between the terms of the Agreement and the Plan, the terms of the Plan will govern.

2.Vesting & Distribution. The Restricted Stock Units will vest ratably on the first, second, third and fourth anniversaries of the Grant Date. The Company will issue to you a number of Shares equal to the number of your vested Restricted Stock Units (including any dividend equivalents described in Section 5, below) within six weeks following each applicable vesting date, provided that you have not incurred a Termination of Employment prior to such vesting date (the “Restricted Period”). Notwithstanding the preceding sentence, if you incur a Termination of Employment during the Restricted Period as a result of your death, Disability or Retirement, you will vest in the next tranche of your Restricted Stock Units on a pro rata basis (based on the length of time you were employed during the applicable portion of the Restricted Period), and the Company will issue you a number of Shares equal to the number of your vested Restricted Stock Units (including any dividend equivalents described in Section 5, below) within six weeks following your separation from service. Any portion of the Restricted Stock Units that does not vest in accordance with the foregoing will automatically be forfeited and canceled by the Company as of 11:00 p.m. CT (midnight ET) on the date of such Termination of Employment. Upon your Termination of Employment during the Restricted Period for any reason other than death, Disability or Retirement, the Restricted Stock Units will automatically be forfeited in full and canceled by the Company as of 11:00 p.m. CT (midnight ET) on the date of such Termination of Employment. For purposes of this Agreement, the term “Disability” shall have the meaning ascribed to it under the Global Disability Policy maintained by the Committee or its delegate and the term “Retirement” shall mean the earlier of: (i) Termination of Employment from the

Company or an Affiliate on or after attaining age 55 with 10 years of service; (ii) Termination of Employment on or after attaining age 62; or (iii) if, on your termination date, you are employed in a country (i.e., receiving pay and benefits from that country) that is designated on the Global Retirement Policy maintained by the Committee or its delegate, the age or combination of age and service specifically for such country on the Global Retirement Policy.

3.Forfeiture. If you have received or are entitled to receive delivery of Shares as a result of this Agreement within the period beginning six months prior to the date of your Termination of Employment and ending twelve months following the date of your Termination of Employment, the Company, in its sole discretion, may require you to return or forfeit the cash and/or Shares received or receivable with respect to this Restricted Stock Units award, in the event that you engage in any of the following activities:

a.performing services for or on behalf of any competitor of, or competing with, the Company or any Affiliate, within six months of the date of your Termination of Employment;

b.unauthorized disclosure of material proprietary information of the Company or any Affiliate;

c.a violation of applicable business ethics policies or business policies of the Company or any Affiliate; or

d.any other occurrence determined by the Committee.

The Company’s right to require forfeiture must be exercised not later than 90 days after the Company acquires actual knowledge of such an activity but in no event later than twelve months after your Termination of Employment. Such right shall be deemed to be exercised upon the Company’s mailing written notice of such exercise to your most recent home address as shown on the personnel records of the Company. In addition to requiring forfeiture as described herein, the Company may exercise its rights under this Section 3 by terminating the Restricted Stock Units awarded under this Agreement.

If you fail or refuse to forfeit the cash and/or shares of Common Stock demanded by the Company (the number of such shares of Common Stock as may be adjusted for any events described in Section 3.4 of the Plan), you shall be liable to the Company for damages equal to the number of Shares demanded times the highest closing price per share of the Common Stock during the period between the date of your Termination of Employment and the date of any judgment or award to the Company, together with all costs and attorneys’ fees incurred by the Company to enforce this provision.

For purposes of this Section 3, forfeiture of Common Stock shall be effected by the redemption of such Common Stock in accordance with the Articles of Association of the Company and to the extent permissible under applicable law.

Notwithstanding the foregoing, this Section 3 shall have no application following a Change of Control, nor shall the Company’s Incentive Compensation Forfeiture Policy apply following a Change of Control to the Restricted Stock Units awarded pursuant to this Agreement or to any proceeds in respect of such award.

4.Change of Control. Notwithstanding anything in Section 2 of this Agreement to the contrary, if a Change of Control of the Company occurs during the Restricted Period,

then the Restricted Stock Units will become 100% vested upon such Change of Control, and the Company will issue to you a number of Shares equal to the number of Restricted Stock Units (including any dividend equivalents described in Section 5, below) within six weeks following the Change of Control, provided that no such vesting or issuance shall occur if the Restricted Stock Units are replaced or continued by a Replacement Award that satisfies the requirements of Section 10.1(b) of the Plan. In the event that the Restricted Stock Units are replaced by a Replacement Award and you incur a Termination of Employment during the two years following a Change of Control by the Company without Cause or by you for Good Reason, such Replacement Award shall vest in full and be settled within six weeks following your Termination of Employment.

5.Dividend Equivalents. You are entitled to receive dividend equivalents on the Restricted Stock Units generally in the same manner and at the same time as if each Restricted Stock Unit were a Share. These dividend equivalents will be credited to you in the form of additional Restricted Stock Units. The additional Restricted Stock Units will be subject to the terms of this Agreement.

6.Clawback; Repayment. The Restricted Stock Units shall be subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with (i) any clawback, forfeiture or other similar policy adopted by the Board or the Committee and as in effect from time to time, and (ii) applicable law. In addition, if you receive any amount in excess of the amount that you should have otherwise received under the terms of the Restricted Stock Units for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), the Committee may provide that you shall be required to repay any such excess amount to the Company and its Subsidiaries.

7.Withhold Taxes. You are responsible to promptly pay any Social Security and Medicare taxes (together, “FICA”) due upon vesting of the Restricted Stock Units, and any Federal, State, and local taxes due upon distribution of the Shares. The Company and its Subsidiaries are authorized to deduct from any payment to you any such taxes required to be withheld. As described in Section 15.4 of the Plan and to the extent permissible under applicable law, you may elect to have the Company withhold a portion of the Shares issued upon settlement of the Restricted Stock Units to satisfy all or part of the withholding tax requirements. You may also elect, at the time you vest in the Restricted Stock Units, to pay your FICA liability due with respect to those Restricted Stock Units out of those units. If you choose to do so, the Company will reduce the number of your vested Restricted Stock Units accordingly. The amount that is applied to pay FICA will be subject to Federal, State, and local taxes.

8.Limitation of Rights. Except as set forth in the Agreement, until the Shares are issued to you in settlement of your Restricted Stock Units, you do not have any right in, or with respect to, any Shares (including any voting rights) by reason of this Agreement. Further, you may not transfer or assign your rights under the Agreement and you do not have any rights in the Company’s assets that are superior to a general, unsecured creditor of the Company by reason of this Agreement.

9.No Employment Contract. Nothing contained in the Plan or Agreement creates any right to your continued employment or otherwise affects your status as an employee at will. You hereby acknowledge that the Company and you each have the right to terminate your employment at any time for any reason or for no reason at all.

10.Amendment to Agreement Under Section 409A of the Code. You acknowledge that the Agreement and the Plan are intended to be exempt from Section 409A of the Code,

and that changes may need to be made to the Agreement to avoid adverse tax consequences under Section 409A of the Code. You agree that following the issuance of such rules, the Company may amend this Agreement as it deems necessary or desirable to avoid such adverse tax consequences; provided, however, that the Company shall accomplish such amendments in a manner that preserves your intended benefits under the Agreement to the greatest extent possible.

11.Governing Law, Venue and Personal Jurisdiction. Notwithstanding anything contrary in the Plan or Section 12 of this Agreement, the validity, enforceability, construction and interpretation of the Plan or Agreement shall be governed by the laws of the State of Minnesota. You irrevocably waive any right to have the laws of any state or nation or other legal jurisdiction other than the State of Minnesota apply to the Plan or Agreement. Any dispute regarding the Plan or Agreement that is not subject to Section 12 or is allowed to be brought in court pursuant to Section 12 (“Permitted Court Action”) shall be exclusively decided by a state court in the State of Minnesota, and you irrevocably waive any right to have any such disputes decided in any jurisdiction or venue other than a state court in the State of Minnesota. You irrevocably consent to the personal jurisdiction of the state courts in the State of Minnesota for the purposes of any Permitted Court Action, and irrevocably waive any right to remove any case commenced by Medtronic from a state court in the State of Minnesota to any federal court.

12.If you are a U.S. based employee, this Section 12 contains the terms and conditions of an agreement to arbitrate claims (“Arbitration Agreement”) between you and Medtronic. The Federal Arbitration Act (“FAA”) (9 U.S.C. §1 et. seq.) applies to and governs this Arbitration Agreement. All claims and disputes covered by this Arbitration Agreement will be decided by a single arbitrator through final and binding arbitration and not by way of court or jury trial.

a.Covered Claims. You and Medtronic agree that, except as otherwise provided in this Arbitration Agreement, all claims or disputes, past, present, or future, arising out of or related to: (i) this Agreement, (ii) the Award, or (iii) the Plan (including, without limitations, claims for breach of contract, breach of fiduciary duty, and claims for violation of any federal, state, or other governmental law, statute, regulation, or ordinance) will be decided by a single arbitrator through final and binding arbitration under the terms of this Arbitration Agreement. This arbitration Agreement applies to any disputes that the Company may have against you or that you may have against the Company, and/or any of its past, present, or future: (i) officers, directors, members, owners, shareholders, employees, and board members; (ii) parents, subsidiaries, and affiliates; and (iii) Plan Administrators and Committee members or Committees (as those terms are defined in the Plan); and (iv) predecessors, successors, or assigns. Each and all of the entities/individuals listed in the preceding sentence may enforce this Arbitration Agreement as a direct or third-party beneficiary. If any claim(s) not covered under this Arbitration Agreement are combined with claims that are covered under this Arbitration Agreement, to the maximum extent permitted under applicable law, the covered claims will be arbitrated and continue to be covered under this Arbitration Agreement.

b.The arbitrator, and not any federal, state, or local court or agency, shall have exclusive authority to resolve any dispute relating to the scope, interpretation, applicability, enforceability, or waiver of this Arbitration Agreement. However, the preceding sentence does not apply to the

Section 12(e) of this Arbitration Agreement. Notwithstanding any other clause or language in this Arbitration Agreement and/or any rules or procedures that might otherwise apply by virtue of this Arbitration Agreement, any claim that all or any portion of the Class Action Waiver is unenforceable, inapplicable, unconscionable, or void or voidable, will be determined only by a court of competent jurisdiction and not by an arbitrator.

c.Limitations. This Arbitration Agreement does not cover any claims or disputes that an applicable federal statute expressly states cannot be arbitrated or subject to a pre-dispute arbitration agreement. Both the Company and you may apply to a court of competent jurisdiction as permitted in this Arbitration Agreement for temporary or preliminary injunctive relief in connection with an arbitrable controversy, but only upon the ground that the award to which that party may be entitled may be rendered ineffectual without such relief. The court to which the application is made is authorized to grant temporary or preliminary injunctive relief and may do so with or without addressing the merits of the underlying arbitrable dispute, as provided by applicable law of the jurisdiction. All determination of final relief will be decided in arbitration, and the pursuit of temporary or preliminary injunctive relief shall not be deemed incompatible with or constitute a waiver of rights under this Arbitration Agreement.

d.Procedures. The arbitration will be administered by the American Arbitration Association (“AAA”), and except as provided in this Arbitration Agreement, will be under the then current Commercial Arbitration Rules of the AAA (“AAA Rules”); provided, however, that if there is a conflict between the AAA Rules and this Arbitration Agreement, this Arbitration Agreement shall govern. Unless the parties jointly agree otherwise, the arbitrator must be a retired judge from any jurisdiction. Unless the parties jointly agree otherwise, the arbitration will take place in the county where you are employed or were last employed by the Company.

i.The arbitrator will be selected as follows: AAA will give each party a list of 11 potential arbitrators (who are subject to the qualifications of the preceding paragraph) drawn from its panel of arbitrators from which the parties will strike alternately by telephone conference administered by AAA, with the claimant to strike first, until only one name remains. That person will be designated as the arbitrator. If the individual selected cannot serve, AAA will issue another list of 11 potential arbitrators and repeat the alternate striking selection process. If AAA will not administer the arbitration, either party may apply to a court of competent jurisdiction with authority over the location where the arbitration will be conducted to appoint a neutral arbitrator, who shall act under this Arbitration Agreement with the same force and effect as if he or she had been specifically named herein.

ii.The arbitrator may award any remedy to which a party is entitled under applicable law, but remedies will be limited to those that would be available to a party in their individual capacity for the claims presented to the arbitrator. Either party may file dispositive motions, including without limitation a motion to dismiss and/or a motion for

summary judgment and the arbitrator will apply the standards governing such motions under the Federal Rules of Civil Procedure. A party may make an offer of judgment in a manner consistent with, and within the time limitations, consequences, and effects provided in Rule 68 of the Federal Rules of Civil Procedure.

iii.The arbitrator will issue an award by written opinion within thirty (30) days from the date the arbitration hearing concludes. The opinion will be in writing and include the factual and legal basis for the award. The award issued by the arbitrator may be entered in any court of competent jurisdiction.

e.Class and Collective Action Waivers. You and the Company agree to bring any claim on an individual basis. Accordingly, YOU AND THE COMPANY WAIVE ANY RIGHT FOR ANY DISPUTE TO BE BROUGHT, HEARD, DECIDED OR ARBITRATED AS A CLASS ACTION AND/OR COLLECTIVE ACTION AND THE ARBITRATOR WILL HAVE NO AUTHORITY TO HEAR OR PRESIDE OVER ANY CLASS AND/OR COLLECTIVE ACTION (“Class Action Waiver”). Additionally, no arbitration proceeding under this Arbitration Agreement may be consolidated or joined in any way with an arbitration proceeding involving claims by different employees. The Class Action Waiver will be severable from this Arbitration Agreement if there is a final judicial determination that the Class Action Waiver is invalid, unenforceable, unconscionable, void, or voidable. In such case, the class and/or collective action must be litigated in a civil court of competent jurisdiction—not in arbitration—but any portion of the Class Action Waiver that is enforceable shall be enforced in arbitration.

f.Discovery. Each party may take the deposition of 3 individual fact witnesses and any expert witness designated by another party. Each party may also propound requests for production of documents, and each party may subpoena witnesses and documents for discovery or the arbitration hearing, including testimony and documents relevant to the case from third parties, in accordance with any applicable state or federal law. Additional discovery may be conducted by mutual stipulation, and the arbitrator will have exclusive authority to entertain requests for additional discovery, and to grant or deny such requests, based on the arbitrator’s determination whether additional discovery is warranted by the circumstances of a particular case.

g.Construction. Subject to Section 12(e), which includes its own severability provision, if any provision of this Arbitration Agreement is adjudged to be invalid, unenforceable, unconscionable, or void or voidable, in whole or in part, such adjudication will not affect the validity of the remainder of the Arbitration Agreement. All remaining provisions will remain in full force and effect. The mutual promises by the Company and you to arbitrate provide consideration for this Arbitration Agreement. Your entitlement to an Award provides additional and separate consideration for this Arbitration Agreement. Any contractual disclaimers the Company has in any handbooks, other agreements, or policies do not apply to this Arbitration Agreement. Notwithstanding any contrary language in the Agreement or otherwise, this Arbitration Agreement will survive the

termination of the Agreement, the Plan, your employment and the expiration of any benefit.

13.Agreement. By accepting your stock grant electronically on the administrator’s website or otherwise accepting or receiving the stock grant, you agree to be bound by the terms and conditions of this Agreement and the Plan, including, without limitation, the Arbitration Agreement. Your signature is not required in order to make this Agreement effective.

Medtronic Stock Administration

Medtronic plc

c/o Medtronic, Inc.

800 53rd Ave NE #SLK32

Minneapolis, MN 55432

askhr@medtronic.com

888-422-1500

7

Document

MEDTRONIC plc

RESTRICTED STOCK UNIT AWARD AGREEMENT 2021 MEDTRONIC PLC LONG TERM INCENTIVE PLAN

Name:

Employee ID:

Client Grant ID:

Grant Date:

Grant Price:

Grant Type:

Shares Awarded:

1.Restricted Stock Units Award. Medtronic plc, an Irish public limited company (the “Company”), hereby awards to the individual named above Restricted Stock Units, in the number and on the Grant Date as each is set forth above. The Restricted Stock Units represent the right to receive ordinary shares of the Company, par value $0.0001 per share (the “Shares”), subject to the restrictions, limitations, and conditions contained in this Restricted Stock Unit Award Agreement (the “Agreement”) and in the 2021 Medtronic plc Long Term Incentive Plan (the “Plan”). Unless otherwise defined in the Agreement, a capitalized term in the Agreement will have the same meaning as in the Plan. In the event of any inconsistency between the terms of the Agreement and the Plan, the terms of the Plan will govern.

2.Vesting & Distribution. The Restricted Stock Units will vest 100% on the third anniversary of the Grant Date. The Company will issue to you a number of Shares equal to the number of your vested Restricted Stock Units (including any dividend equivalents described in Section 5, below) within six weeks following the applicable vesting date, provided that you have not incurred a Termination of Employment prior to such vesting date (the “Restricted Period”). Notwithstanding the preceding sentence, if you incur a Termination of Employment during the Restricted Period as a result of your death, Disability or Retirement (other than if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs, as provided in Section 3 below), you will vest 100% on the third anniversary of the Grant Date, and the Company will issue you a number of Shares equal to the number of your vested Restricted Stock Units (including any dividend equivalents described in Section 5, below) within six weeks following vesting. Any portion of the Restricted Stock Units that does not vest in accordance with the foregoing will automatically be forfeited and canceled by the Company as of 11:00 p.m. CT (midnight ET) on the date of such Termination of Employment. Upon your Termination of Employment during the Restricted Period for any reason other than death, Disability or Retirement, including a Termination of Employment during the Restricted Period that results from your Retirement on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs, the Restricted Stock Units will automatically be forfeited in full and canceled by the Company as of 11:00 p.m. CT (midnight ET) on the date of such Termination of Employment. For

purposes of this Agreement, the term “Disability” shall have the meaning ascribed to it under the Global Disability Policy maintained by the Committee or its delegate and the term “Retirement” shall mean the earlier of: (i) Termination of Employment from the Company or an Affiliate on or after attaining age 55 with 10 years of service; (ii) Termination of Employment on or after attaining age 62; (iii) if, on your termination date, you are employed in a country (i.e., receiving pay and benefits from that country) that is designated on the Global Retirement Policy maintained by the Committee or its delegate, the age or combination of age and service specifically for such country on the Global Retirement Policy.

3.Forfeiture. If you have received or are entitled to receive delivery of Shares as a result of this Agreement within the period beginning six months prior to the date of your Termination of Employment and ending twelve months following the date of your Termination of Employment, the Company, in its sole discretion, may require you to return or forfeit the cash and/or Shares received or receivable with respect to this Restricted Stock Units award, in the event that you engage in any of the following activities:

a.performing services for or on behalf of any competitor of, or competing with, the Company or any Affiliate, within six months of the date of your Termination of Employment;

b.unauthorized disclosure of material proprietary information of the Company or any Affiliate;

c.a violation of applicable business ethics policies or business policies of the Company or any Affiliate; or

d.any other occurrence determined by the Committee.

The Company’s right to require forfeiture must be exercised not later than 90 days after the Company acquires actual knowledge of such an activity but in no event later than twelve months after your Termination of Employment. Such right shall be deemed to be exercised upon the Company’s mailing written notice of such exercise to your most recent home address as shown on the personnel records of the Company. In addition to requiring forfeiture as described herein, the Company may exercise its rights under this Section 3 by terminating the Restricted Stock Units awarded under this Agreement.

If you fail or refuse to forfeit the cash and/or shares of Common Stock demanded by the Company (the number of such shares of Common Stock as may be adjusted for any events described in Section 3.4 of the Plan), you shall be liable to the Company for damages equal to the number of Shares demanded times the highest closing price per share of the Common Stock during the period between the date of your Termination of Employment and the date of any judgment or award to the Company, together with all costs and attorneys’ fees incurred by the Company to enforce this provision.

For purposes of this Section 3, forfeiture of Common Stock shall be effected by the redemption of such Common Stock in accordance with the Articles of Association of the Company and to the extent permissible under applicable law.

Notwithstanding the foregoing, this Section 3 shall have no application following a Change of Control, nor shall the Company’s Incentive Compensation Forfeiture

Policy apply following a Change of Control to the Restricted Stock Units awarded pursuant to this Agreement or to any proceeds in respect of such award.

In addition to the foregoing, the Restricted Stock Units will terminate upon the date of your Retirement, and you will forfeit the continued vesting described in Section 2 that would otherwise apply to a Termination of Employment as a result of Retirement, if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs.

4.Change of Control. Notwithstanding anything in Section 2 of this Agreement to the contrary, if a Change of Control of the Company occurs during the Restricted Period, then the Restricted Stock Units will become 100% vested upon such Change of Control, and the Company will issue to you a number of Shares equal to the number of Restricted Stock Units (including any dividend equivalents described in Section 5, below) within six weeks following the Change of Control, provided that no such vesting or issuance shall occur if the Restricted Stock Units are replaced or continued by a Replacement Award that satisfies the requirements of Section 10.1(b) of the Plan. In the event that the Restricted Stock Units are replaced by a Replacement Award and you incur a Termination of Employment during the two years following a Change of Control by the Company without Cause or by you for Good Reason, such Replacement Award shall vest in full and be settled within six weeks following your Termination of Employment.

5.Dividend Equivalents. You are entitled to receive dividend equivalents on the Restricted Stock Units generally in the same manner and at the same time as if each Restricted Stock Unit were a Share. These dividend equivalents will be credited to you in the form of additional Restricted Stock Units. The additional Restricted Stock Units will be subject to the terms of this Agreement.

6.Clawback; Repayment. The Restricted Stock Units shall be subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with (i) any clawback, forfeiture or other similar policy adopted by the Board or the Committee and as in effect from time to time, and (ii) applicable law. In addition, if you receive any amount in excess of the amount that you should have otherwise received under the terms of the Restricted Stock Units for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), the Committee may provide that you shall be required to repay any such excess amount to the Company and its Subsidiaries.

7.Withhold Taxes. You are responsible to promptly pay any Social Security and Medicare taxes (together, “FICA”) due upon vesting of the Restricted Stock Units, and any Federal, State, and local taxes due upon distribution of the Shares. The Company and its Subsidiaries are authorized to deduct from any payment to you any such taxes required to be withheld. As described in Section 15.4 of the Plan and to the extent permissible under applicable law, you may elect to have the Company withhold a portion of the Shares issued upon settlement of the Restricted Stock Units to satisfy all or part of the withholding tax requirements. You may also elect, at the time you vest in the Restricted Stock Units, to pay your FICA liability due with respect to those Restricted Stock Units out of those units. If you choose to do so, the Company will reduce the number of your vested Restricted Stock Units accordingly. The amount that is applied to pay FICA will be subject to Federal, State, and local taxes.

8.Limitation of Rights. Except as set forth in the Agreement, until the Shares are issued to you in settlement of your Restricted Stock Units, you do not have any right in, or with respect to, any Shares (including any voting rights) by reason of this Agreement. Further, you may not transfer or assign your rights under the Agreement and you do not have any rights in the Company’s assets that are superior to a general, unsecured creditor of the Company by reason of this Agreement.

9.No Employment Contract. Nothing contained in the Plan or Agreement creates any right to your continued employment or otherwise affects your status as an employee at will. You hereby acknowledge that the Company and you each have the right to terminate your employment at any time for any reason or for no reason at all.

10.Amendment to Agreement Under Section 409A of the Code. You acknowledge that the Agreement and the Plan are intended to be exempt from Section 409A of the Code, and that changes may need to be made to the Agreement to avoid adverse tax consequences under Section 409A of the Code. You agree that following the issuance of such rules, the Company may amend this Agreement as it deems necessary or desirable to avoid such adverse tax consequences; provided, however, that the Company shall accomplish such amendments in a manner that preserves your intended benefits under the Agreement to the greatest extent possible.

11.Governing Law, Venue and Personal Jurisdiction. Notwithstanding anything contrary in the Plan or Section 12 of this Agreement, the validity, enforceability, construction and interpretation of the Plan or Agreement shall be governed by the laws of the State of Minnesota. You irrevocably waive any right to have the laws of any state or nation or other legal jurisdiction other than the State of Minnesota apply to the Plan or Agreement. Any dispute regarding the Plan or Agreement that is not subject to Section 12 or is allowed to be brought in court pursuant to Section 12 (“Permitted Court Action”) shall be exclusively decided by a state court in the State of Minnesota, and you irrevocably waive any right to have any such disputes decided in any jurisdiction or venue other than a state court in the State of Minnesota. You irrevocably consent to the personal jurisdiction of the state courts in the State of Minnesota for the purposes of any Permitted Court Action, and irrevocably waive any right to remove any case commenced by Medtronic from a state court in the State of Minnesota to any federal court.

12.Arbitration Agreement. If you are a U.S. based employee, this Section 12 contains the terms and conditions of an agreement to arbitrate claims (“Arbitration Agreement”) between you and Medtronic. The Federal Arbitration Act (“FAA”) (9 U.S.C. §1 et. seq.) applies to and governs this Arbitration Agreement. All claims and disputes covered by this Arbitration Agreement will be decided by a single arbitrator through final and binding arbitration and not by way of court or jury trial.

a.Covered Claims. You and Medtronic agree that, except as otherwise provided in this Arbitration Agreement, all claims or disputes, past, present, or future, arising out of or related to: (i) this Agreement, (ii) the Award, or (iii) the Plan (including, without limitations, claims for breach of contract, breach of fiduciary duty, and claims for violation of any federal, state, or other governmental law, statute, regulation, or ordinance) will be decided by a single arbitrator through final and binding arbitration under the terms of this Arbitration Agreement. This arbitration Agreement applies to any disputes that the Company may have against you or that you may have against the Company, and/or any of its past, present, or future:

(i) officers, directors, members, owners, shareholders, employees, and board members; (ii) parents, subsidiaries, and affiliates; and (iii) Plan Administrators and Committee members or Committees (as those terms are defined in the Plan); and (iv) predecessors, successors, or assigns. Each and all of the entities/individuals listed in the preceding sentence may enforce this Arbitration Agreement as a direct or third-party beneficiary. If any claim(s) not covered under this Arbitration Agreement are combined with claims that are covered under this Arbitration Agreement, to the maximum extent permitted under applicable law, the covered claims will be arbitrated and continue to be covered under this Arbitration Agreement.

b.The arbitrator, and not any federal, state, or local court or agency, shall have exclusive authority to resolve any dispute relating to the scope, interpretation, applicability, enforceability, or waiver of this Arbitration Agreement. However, the preceding sentence does not apply to Section 12(e) of this Arbitration Agreement. Notwithstanding any other clause or language in this Arbitration Agreement and/or any rules or procedures that might otherwise apply by virtue of this Arbitration Agreement, any claim that all or any portion of the Class Action Waiver is unenforceable, inapplicable, unconscionable, or void or voidable, will be determined only by a court of competent jurisdiction and not by an arbitrator.

c.Limitations. This Arbitration Agreement does not cover any claims or disputes that an applicable federal statute expressly states cannot be arbitrated or subject to a pre-dispute arbitration agreement. Both the Company and you may apply to a court of competent jurisdiction as permitted in this Arbitration Agreement for temporary or preliminary injunctive relief in connection with an arbitrable controversy, but only upon the ground that the award to which that party may be entitled may be rendered ineffectual without such relief. The court to which the application is made is authorized to grant temporary or preliminary injunctive relief and may do so with or without addressing the merits of the underlying arbitrable dispute, as provided by applicable law of the jurisdiction. All determination of final relief will be decided in arbitration, and the pursuit of temporary or preliminary injunctive relief shall not be deemed incompatible with or constitute a waiver of rights under this Arbitration Agreement.

d.Procedures. The arbitration will be administered by the American Arbitration Association (“AAA”), and except as provided in this Arbitration Agreement, will be under the then current Commercial Arbitration Rules of the AAA (“AAA Rules”); provided, however, that if there is a conflict between the AAA Rules and this Arbitration Agreement, this Arbitration Agreement shall govern. Unless the parties jointly agree otherwise, the arbitrator must be a retired judge from any jurisdiction. Unless the parties jointly agree otherwise, the arbitration will take place in the county where you are employed or were last employed by the Company.

i.The arbitrator will be selected as follows: AAA will give each party a list of 11 potential arbitrators (who are subject to the qualifications of the preceding paragraph) drawn from its panel of arbitrators from which the parties will strike alternately by telephone conference

administered by AAA, with the claimant to strike first, until only one name remains. That person will be designated as the arbitrator. If the individual selected cannot serve, AAA will issue another list of 11 potential arbitrators and repeat the alternate striking selection process. If AAA will not administer the arbitration, either party may apply to a court of competent jurisdiction with authority over the location where the arbitration will be conducted to appoint a neutral arbitrator, who shall act under this Arbitration Agreement with the same force and effect as if he or she had been specifically named herein.

ii.The arbitrator may award any remedy to which a party is entitled under applicable law, but remedies will be limited to those that would be available to a party in their individual capacity for the claims presented to the arbitrator. Either party may file dispositive motions, including without limitation a motion to dismiss and/or a motion for summary judgment and the arbitrator will apply the standards governing such motions under the Federal Rules of Civil Procedure. A party may make an offer of judgment in a manner consistent with, and within the time limitations, consequences, and effects provided in Rule 68 of the Federal Rules of Civil Procedure.

iii.The arbitrator will issue an award by written opinion within thirty (30) days from the date the arbitration hearing concludes. The opinion will be in writing and include the factual and legal basis for the award. The award issued by the arbitrator may be entered in any court of competent jurisdiction.

e.Class and Collective Action Waivers. You and the Company agree to bring any claim on an individual basis. Accordingly, YOU AND THE COMPANY WAIVE ANY RIGHT FOR ANY DISPUTE TO BE BROUGHT, HEARD, DECIDED OR ARBITRATED AS A CLASS ACTION AND/OR COLLECTIVE ACTION AND THE ARBITRATOR WILL HAVE NO AUTHORITY TO HEAR OR PRESIDE OVER ANY CLASS AND/OR COLLECTIVE ACTION (“Class Action Waiver”). Additionally, no arbitration proceeding under this Arbitration Agreement may be consolidated or joined in any way with an arbitration proceeding involving claims by different employees. The Class Action Waiver will be severable from this Arbitration Agreement if there is a final judicial determination that the Class Action Waiver is invalid, unenforceable, unconscionable, void, or voidable. In such case, the class and/or collective action must be litigated in a civil court of competent jurisdiction—not in arbitration—but any portion of the Class Action Waiver that is enforceable shall be enforced in arbitration.

f.Discovery. Each party may take the deposition of 3 individual fact witnesses and any expert witness designated by another party. Each party may also propound requests for production of documents, and each party may subpoena witnesses and documents for discovery or the arbitration hearing, including testimony and documents relevant to the case from third parties, in accordance with any applicable state or federal law. Additional discovery may be conducted by mutual stipulation, and the arbitrator will have exclusive authority to entertain requests for additional discovery, and to grant or deny such requests, based on the arbitrator’s

determination whether additional discovery is warranted by the circumstances of a particular case.

g.Construction. Subject to Section 12(e), which includes its own severability provision, if any provision of this Arbitration Agreement is adjudged to be invalid, unenforceable, unconscionable, or void or voidable, in whole or in part, such adjudication will not affect the validity of the remainder of the Arbitration Agreement. All remaining provisions will remain in full force and effect. The mutual promises by the Company and you to arbitrate provide consideration for this Arbitration Agreement. Your entitlement to an Award provides additional and separate consideration for this Arbitration Agreement. Any contractual disclaimers the Company has in any handbooks, other agreements, or policies do not apply to this Arbitration Agreement. Notwithstanding any contrary language in the Agreement or otherwise, this Arbitration Agreement will survive the termination of the Agreement, the Plan, your employment and the expiration of any benefit.

13.Agreement. By accepting your stock grant electronically on the administrator’s website or otherwise accepting or receiving the stock grant, you agree to be bound by the terms and conditions of this Agreement and the Plan, including, without limitation, the Arbitration Agreement. Your signature is not required in order to make this Agreement effective.

Medtronic Stock Administration

Medtronic plc

c/o Medtronic, Inc.

800 53rd Ave NE #SLK32

Minneapolis, MN 55432

askhr@medtronic.com

888-422-1500

7

Document

MEDTRONIC plc

NON-QUALIFIED STOCK OPTION AGREEMENT 2021 MEDTRONIC PLC LONG TERM INCENTIVE PLAN

Name:

Employee ID:

Client Grant ID:

Grant Date:

Grant Price:

Grant Type:

Shares Awarded:

Expiration Date:

1.The Option. Medtronic plc, an Irish public limited company (the “Company”), hereby grants to you, the individual named above, as of the above Grant Date, an option (the “Option”) to purchase the above number of ordinary shares of the Company, par value $0.0001 per share (the “Common Stock”), for the above Option Price Per Share, on the terms and conditions set forth in this Non-Qualified Stock Option Agreement (this “Agreement”) and in the 2021 Medtronic Long Term Incentive Plan (the “Plan”). In the event of any inconsistency between the terms of the Agreement and the Plan, the terms of the Plan shall govern. Capitalized terms not defined in this Agreement shall have the meanings ascribed to them in the Plan.

2.Exercise of Option. The exercise of the Option is subject to the following conditions and restrictions:

a.Expiration. Upon vesting of a portion of the Option, such portion may be exercised in whole or in part until the earlier of (i) the above Expiration Date, or (ii) the expiration of the applicable period following your Termination of Employment, as provided in Sections 2(c), (d) or (e) below.

b.Schedule of Exercisability. The Option shall become vested and exercisable to the extent of 25% of the above number of shares of Common Stock on each of the first, second, third and fourth anniversaries of the Grant Date. Once a portion of the Option has become exercisable, that portion may be exercised at any time thereafter, subject to the provisions of Section 2(a) above.

c.Death. Notwithstanding the schedule of exercisability set forth in Section 2(b) above, the Option shall become immediately exercisable in full upon your death, and may be exercised by your Successor (as defined below) at any time, or from time to time, within five years after the date of your

death, subject to Section 2(g) below. For purposes of this Agreement, the term “Successor” shall mean the legal representative of your estate or the person or persons who may, by bequest, inheritance or valid beneficiary designation (as provided in Section 15.7 of the Plan), acquire the right to exercise the Option

d.Disability or Retirement. Notwithstanding the schedule of exercisability set forth in Section 2(b) above, and except if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs, the Option shall become immediately exercisable in full upon your Disability or Retirement (as each such term is defined below), and you may exercise your Option at any time, or from time to time, within five years after the date of Retirement or determination of Disability, subject to Section 2(g) below. For purposes of this Agreement, the term “Disability” shall have the meaning ascribed to it under the Global Disability Policy maintained by the Committee or its delegate and the term “Retirement” shall mean the earlier of: (i) Termination of Employment from the Company or an Affiliate on or after attaining age 55 with 10 years of service; (ii) Termination of Employment on or after attaining age 62; or (iii) if, on your termination date, you are employed in a country (i.e., receiving pay and benefits from that country) that is designated on the Global Retirement Policy maintained by the Committee or its delegate, the age or combination of age and service specifically for such country on the Global Retirement Policy.

e.Termination for Any Other Reason. In the event you incur a Termination of Employment for any reason other than those specified in Sections 2(c) and 2(d), and if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs, as provided in Section 5 below, any unvested portion of the Option will terminate as of 11:00 p.m. CT (midnight ET) on the date of your Termination of Employment. You may exercise that portion of the Option that was vested but unexercised as of the date of your Termination of Employment for ninety (90) days following the date of your Termination of Employment, subject to Section 2(g) below. At 11:00 p.m. CT (midnight ET) on the date that is 90 days after the date of your Termination of Employment, the Option will expire.

f.Change of Control. Notwithstanding any other provision of this Agreement, the Option shall be subject to the provisions of Section 10.1 of the Plan.

g.Expiration of Term. Notwithstanding the foregoing paragraphs (a)−(f), in no event shall the Option be exercisable after the Expiration Date.

3.Manner of Exercise. To exercise your Option, you must deliver notice of exercise (the “Notice”) to the administrator (the “Administrator”) designated by the Company to provide services relating to the administration of the Plan at the time of your exercise. The Notice must be given in the manner specified by the Administrator and must specify the number of shares of Common Stock (the “Shares”) as to which the Option is being exercised and must be accompanied by payment of the purchase price for the Shares. Payment of the purchase price may be in cash or by check. To the extent permissible under applicable law, payment of the purchase price may also be made by instructing the Company to withhold a number of Shares having a Fair Market Value (based on the Fair

Market Value of the Common Stock on the date the applicable Option is exercised) equal to the product of (i) the exercise price multiplied by (ii) the number of Shares in respect of which the Option shall have been exercised.

Exercise shall be deemed to occur on the earlier of (i) the date the Notice and the purchase price for the Shares as to which the Option is being exercised are received by the Administrator and (ii) the date you simultaneously exercise the Option and sell the Shares, using the proceeds from such sale to pay the purchase price.

4.Withhold Taxes. You are responsible for payment of any federal, state, local or other taxes which must be withheld upon the exercise of the Option, and you must promptly pay to the Company any such taxes. The Company and its subsidiaries are authorized to deduct from any payment owed to you any taxes required to be withheld with respect to the Shares, including social security and Medicare (FICA) taxes and federal, state and local income tax with respect to income arising from the exercise of the Option. The Company shall have the right to require the payment of any such taxes before issuing any Shares pursuant to an exercise of the Option. In lieu of all or any part of a cash payment, to the extent permissible under applicable law, you may elect to have a portion of the Shares otherwise issuable upon exercise of the Option withheld by the Company to satisfy all or part of the withholding tax requirements relating to the Option exercise with such Shares valued in the same manner as used in computing such withholding taxes. Any fractional Share amount due relating to such tax withholding will be rounded up to the nearest whole Share and the additional amount will be added to your federal withholding.

5.Forfeitures. If you have received or been entitled to receive payment in cash, delivery of Common Stock or a combination thereof pursuant to this Agreement within the period beginning six months prior to the date of your Termination of Employment and ending twelve months following the date of your Termination of Employment, the Company, in its sole discretion, may require you to return or forfeit the cash and/or Common Stock received or receivable with respect to this Option (or its economic value as of the date of the exercise of the Option), in the event that you engage in any of the following activities:

a.performing services for or on behalf of any competitor of, or competing with, the Company or any Affiliate, within six months of the date of your Termination of Employment;

b.unauthorized disclosure of material proprietary information of the Company or any Affiliate;

c.a violation of applicable business ethics policies or business policies of the Company or any Affiliate; or

d.any other occurrence determined by the Committee.

The Company’s right to require forfeiture must be exercised not later than 90 days after the Company acquires actual knowledge of such an activity, but in no event later than twelve months after your Termination of Employment. Such right shall be deemed to be exercised upon the Company’s mailing written notice of such exercise to your most recent home address as shown on the personnel records of the Company. In addition to requiring forfeiture as described herein, the Company may exercise its rights under this Section 5 by preventing or terminating the exercise of any rights under this Option or the acquisition of Shares or cash thereunder.

If you fail or refuse to forfeit the cash and/or Shares demanded by the Company (the number of such shares of Common Stock as may be adjusted for any events described in Section 3.4 of the Plan), you shall be liable to the Company for damages equal to the number of Shares demanded times the highest closing price per share of the Common Stock during the period between the date of your Termination of Employment and the date of any judgment or award to the Company, together with all costs and attorneys’ fees incurred by the Company to enforce this provision.

For purposes of this Section 5, forfeiture of Common Stock shall be effected by the

redemption of such Common Stock in accordance with the Articles of Association of the

Company and to the extent permissible under applicable law.

Notwithstanding the foregoing, this Section 5 shall have no application following a Change of Control, nor shall the Company’s Incentive Compensation Forfeiture Policy apply following a Change of Control to this Option or to any proceeds in respect of this Option.

In addition to the foregoing, this Option shall terminate as provided in Section 2(f) on the date of your Retirement, and you will forfeit the accelerated vesting described in Section 2(d) of this Agreement that would otherwise occur with respect to this Option upon your Retirement, if you Retire on or before the last day of the second fiscal quarter of the fiscal year in which the Grant Date occurs.

6.Clawback; Repayment. The Option shall be subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with (i) any clawback, forfeiture or other similar policy adopted by the Board or the Committee and as in effect from time to time, and (ii) applicable law. In addition, if you receive any amount in excess of the amount that you should have otherwise received under the terms of the Option for any reason (including, without limitation, by reason of a financial restatement, mistake in calculations or other administrative error), the Committee may provide that you shall be required to repay any such excess amount to the Company and its Subsidiaries.

7.Conversion to Stock Settled Appreciation Rights. At any time following the Grant Date, the Company may convert this Option to a stock-settled Stock Appreciation Right. Upon exercise of a stock-settled Stock Appreciation Right, you shall receive shares of Common Stock with a value equal to the excess of (1) the Fair Market Value of the Shares on the date of exercise over (2) the Option Price Per Share multiplied by the number of Shares.

8.Governing Law, Venue and Personal Jurisdiction. Notwithstanding anything contrary in the Plan or Section 9 of this Agreement, the validity, enforceability, construction and interpretation of the Plan or Agreement shall be governed by the laws of the State of Minnesota. You irrevocably waive any right to have the laws of any state or nation or other legal jurisdiction other than the State of Minnesota apply to the Plan or Agreement. Any dispute regarding the Plan or Agreement that is not subject to Section 9 or is allowed to be brought in court pursuant to Section 9 (“Permitted Court Action”) shall be exclusively decided by a state court in the State of Minnesota, and you irrevocably waive any right to have any such disputes decided in any jurisdiction or venue other than a state court in the State of Minnesota. You irrevocably consent to the personal jurisdiction of the state courts in the State of Minnesota for the purposes of any Permitted Court Action, and irrevocably waive any right to remove any case commenced by Medtronic from a state court in the State of Minnesota to any federal court.

9.Arbitration Agreement.

a.Covered Claims. You and Medtronic agree that, except as otherwise provided in this Arbitration Agreement, all claims or disputes, past, present, or future, arising out of or related to: (i) this Agreement, (ii) the Award, or (iii) the Plan (including, without limitations, claims for breach of contract, breach of fiduciary duty, and claims for violation of any federal, state, or other governmental law, statute, regulation, or ordinance) will be decided by a single arbitrator through final and binding arbitration under the terms of this Arbitration Agreement. This arbitration Agreement applies to any disputes that the Company may have against you or that you may have against the Company, and/or any of its past, present, or future: (i) officers, directors, members, owners, shareholders, employees, and board members; (ii) parents, subsidiaries, and affiliates; and (iii) Plan Administrators and Committee members or Committees (as those terms are defined in the Plan); and (iv) predecessors, successors, or assigns. Each and all of the entities/individuals listed in the preceding sentence may enforce this Arbitration Agreement as a direct or third-party beneficiary. If any claim(s) not covered under this Arbitration Agreement are combined with claims that are covered under this Arbitration Agreement, to the maximum extent permitted under applicable law, the covered claims will be arbitrated and continue to be covered under this Arbitration Agreement.

b.The arbitrator, and not any federal, state, or local court or agency, shall have exclusive authority to resolve any dispute relating to the scope, interpretation, applicability, enforceability, or waiver of this Arbitration Agreement. However, the preceding sentence does not apply to Section 9(e) of this Arbitration Agreement. Notwithstanding any other clause or language in this Arbitration Agreement and/or any rules or procedures that might otherwise apply by virtue of this Arbitration Agreement, any claim that all or any portion of the Class Action Waiver is unenforceable, inapplicable, unconscionable, or void or voidable, will be determined only by a court of competent jurisdiction and not by an arbitrator.

c.Limitations. This Arbitration Agreement does not cover any claims or disputes that an applicable federal statute expressly states cannot be arbitrated or subject to a pre-dispute arbitration agreement. Both the Company and you may apply to a court of competent jurisdiction as permitted in this Arbitration Agreement for temporary or preliminary injunctive relief in connection with an arbitrable controversy, but only upon the ground that the award to which that party may be entitled may be rendered ineffectual without such relief. The court to which the application is made is authorized to grant temporary or preliminary injunctive relief and may do so with or without addressing the merits of the underlying arbitrable dispute, as provided by applicable law of the jurisdiction. All determination of final relief will be decided in arbitration, and the pursuit of temporary or preliminary injunctive relief shall not be deemed incompatible with or constitute a waiver of rights under this Arbitration Agreement.

d.Procedures. The arbitration will be administered by the American Arbitration Association (“AAA”), and except as provided in this Arbitration Agreement, will be under the then current Commercial

Arbitration Rules of the AAA (“AAA Rules”); provided, however, that if there is a conflict between the AAA Rules and this Arbitration Agreement, this Arbitration Agreement shall govern. Unless the parties jointly agree otherwise, the arbitrator must be a retired judge from any jurisdiction. Unless the parties jointly agree otherwise, the arbitration will take place in the county where you are employed or were last employed by the Company.

i.The arbitrator will be selected as follows: AAA will give each party a list of 11 potential arbitrators (who are subject to the qualifications of the preceding paragraph) drawn from its panel of arbitrators from which the parties will strike alternately by telephone conference administered by AAA, with the claimant to strike first, until only one name remains. That person will be designated as the arbitrator. If the individual selected cannot serve, AAA will issue another list of 11 potential arbitrators and repeat the alternate striking selection process. If AAA will not administer the arbitration, either party may apply to a court of competent jurisdiction with authority over the location where the arbitration will be conducted to appoint a neutral arbitrator, who shall act under this Arbitration Agreement with the same force and effect as if he or she had been specifically named herein.

ii.The arbitrator may award any remedy to which a party is entitled under applicable law, but remedies will be limited to those that would be available to a party in their individual capacity for the claims presented to the arbitrator. Either party may file dispositive motions, including without limitation a motion to dismiss and/or a motion for summary judgment and the arbitrator will apply the standards governing such motions under the Federal Rules of Civil Procedure. A party may make an offer of judgment in a manner consistent with, and within the time limitations, consequences, and effects provided in Rule 68 of the Federal Rules of Civil Procedure.

iii.The arbitrator will issue an award by written opinion within thirty (30) days from the date the arbitration hearing concludes. The opinion will be in writing and include the factual and legal basis for the award. The award issued by the arbitrator may be entered in any court of competent jurisdiction.

e.Class and Collective Action Waivers. You and the Company agree to bring any claim on an individual basis. Accordingly, YOU AND THE COMPANY WAIVE ANY RIGHT FOR ANY DISPUTE TO BE BROUGHT, HEARD, DECIDED OR ARBITRATED AS A CLASS ACTION AND/OR COLLECTIVE ACTION AND THE ARBITRATOR WILL HAVE NO AUTHORITY TO HEAR OR PRESIDE OVER ANY CLASS AND/OR COLLECTIVE ACTION (“Class Action Waiver”). Additionally, no arbitration proceeding under this Arbitration Agreement may be consolidated or joined in any way with an arbitration proceeding involving claims by different employees. The Class Action Waiver will be severable from this Arbitration Agreement if there is a final judicial determination that the Class Action Waiver is invalid, unenforceable, unconscionable, void, or voidable. In such case, the class and/or collective action must be litigated in a civil court of competent jurisdiction—not in

arbitration—but any portion of the Class Action Waiver that is enforceable shall be enforced in arbitration.

f.Discovery. Each party may take the deposition of 3 individual fact witnesses and any expert witness designated by another party. Each party may also propound requests for production of documents, and each party may subpoena witnesses and documents for discovery or the arbitration hearing, including testimony and documents relevant to the case from third parties, in accordance with any applicable state or federal law. Additional discovery may be conducted by mutual stipulation, and the arbitrator will have exclusive authority to entertain requests for additional discovery, and to grant or deny such requests, based on the arbitrator’s determination whether additional discovery is warranted by the circumstances of a particular case.

g.Construction. Subject to Section 9(e), which includes its own severability provision, if any provision of this Arbitration Agreement is adjudged to be invalid, unenforceable, unconscionable, or void or voidable, in whole or in part, such adjudication will not affect the validity of the remainder of the Arbitration Agreement. All remaining provisions will remain in full force and effect. The mutual promises obligations by the Company and you to arbitrate provide consideration for this Arbitration Agreement. Your entitlement to an Award provides additional and separate consideration for this Arbitration Agreement. Any contractual disclaimers the Company has in any handbooks, other agreements, or policies do not apply to this Arbitration Agreement. Notwithstanding any contrary language in the Agreement or otherwise, this Arbitration Agreement will survive the termination of the Agreement, the Plan, your employment and the expiration of any benefit.

10.Agreement. By accepting your stock grant electronically on the administrator’s website or otherwise accepting or receiving the stock grant, you agree to be bound by the terms and conditions of this Agreement and the Plan, including, without limitation, the Arbitration Agreement. Your signature is not required in order to make this Agreement effective.

Medtronic Stock Administration

Medtronic plc

c/o Medtronic, Inc.

800 53rd Ave NE #SLK32

Minneapolis, MN 55432

askhr@medtronic.com

888-422-1500

7

Document

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the

Sarbanes-Oxley Act of 2002

I, Geoffrey S. Martha, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Medtronic plc;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 31, 2023	/s/ Geoffrey S. Martha
	Geoffrey S. Martha
	Chief Executive Officer

Document

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the

Sarbanes-Oxley Act of 2002

I, Karen L. Parkhill, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Medtronic plc;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 31, 2023	/s/ Karen L. Parkhill
	Karen L. Parkhill
	Executive Vice President and
	Chief Financial Officer

Document

Exhibit 32.1

Certification of Chief Executive Officer

Pursuant to Section 906 of the

Sarbanes-Oxley Act of 2002

In connection with this quarterly report on Form 10-Q of Medtronic plc for the quarter ended July 28, 2023, the undersigned hereby certifies, in his capacity as Chief Executive Officer of Medtronic plc, for purposes of 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Medtronic plc.

August 31, 2023	/s/ Geoffrey S. Martha
	Geoffrey S. Martha
	Chief Executive Officer

Document

Exhibit 32.2

Certification of Chief Financial Officer

Pursuant to Section 906 of the

Sarbanes-Oxley Act of 2002

In connection with this quarterly report on Form 10-Q of Medtronic plc for the quarter ended July 28, 2023, the undersigned hereby certifies, in her capacity as Chief Financial Officer of Medtronic plc, for purposes of 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Medtronic plc.

August 31, 2023	/s/ Karen L. Parkhill
	Karen L. Parkhill
	Executive Vice President and
	Chief Financial Officer