2015 Q2 Form 10-Q Financial Statement

#000155528015000210 Filed on August 06, 2015

View on sec.gov

Income Statement

Concept 2015 Q2 2014 Q2
Revenue $1.175B $1.158B
YoY Change 1.47% 3.95%
Cost Of Revenue $427.0M $413.0M
YoY Change 3.39% -0.72%
Gross Profit $748.0M $745.0M
YoY Change 0.4% 6.73%
Gross Profit Margin 63.66% 64.34%
Selling, General & Admin $379.0M $396.0M
YoY Change -4.29% -0.75%
% of Gross Profit 50.67% 53.15%
Research & Development $84.00M $92.00M
YoY Change -8.7% -3.16%
% of Gross Profit 11.23% 12.35%
Depreciation & Amortization $50.00M $51.00M
YoY Change -1.96% 0.0%
% of Gross Profit 6.68% 6.85%
Operating Expenses $463.0M $488.0M
YoY Change -5.12% -1.21%
Operating Profit $285.0M $257.0M
YoY Change 10.89% 25.98%
Interest Expense $29.00M $29.00M
YoY Change 0.0% -9.38%
% of Operating Profit 10.18% 11.28%
Other Income/Expense, Net -$2.000M -$8.000M
YoY Change -75.0% -180.0%
Pretax Income -$27.00M $200.0M
YoY Change -113.5% 6.95%
Income Tax $9.000M $61.00M
% Of Pretax Income 30.5%
Net Earnings -$37.00M $136.0M
YoY Change -127.21% 6.25%
Net Earnings / Revenue -3.15% 11.74%
Basic Earnings Per Share -$0.07 $0.27
Diluted Earnings Per Share -$0.07 $0.27
COMMON SHARES
Basic Shares Outstanding 500.2M shares 501.0M shares
Diluted Shares Outstanding 500.2M shares 501.7M shares

Balance Sheet

Concept 2015 Q2 2014 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $544.0M $578.0M
YoY Change -5.88% 56.64%
Cash & Equivalents $544.0M $578.0M
Short-Term Investments
Other Short-Term Assets $235.0M $207.0M
YoY Change 13.53% -8.81%
Inventory $1.417B $1.336B
Prepaid Expenses
Receivables $993.0M $1.098B
Other Receivables $0.00 $0.00
Total Short-Term Assets $3.316B $3.327B
YoY Change -0.33% 7.95%
LONG-TERM ASSETS
Property, Plant & Equipment $1.295B $1.309B
YoY Change -1.07% 4.55%
Goodwill $1.167B $984.0M
YoY Change 18.6% 0.2%
Intangibles $697.0M $774.0M
YoY Change -9.95% -7.19%
Long-Term Investments
YoY Change
Other Assets $58.00M $71.00M
YoY Change -18.31% 24.56%
Total Long-Term Assets $3.282B $3.195B
YoY Change 2.72% 0.5%
TOTAL ASSETS
Total Short-Term Assets $3.316B $3.327B
Total Long-Term Assets $3.282B $3.195B
Total Assets $6.598B $6.522B
YoY Change 1.17% 4.17%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $278.0M $337.0M
YoY Change -17.51% -42.59%
Accrued Expenses $792.0M $172.0M
YoY Change 360.47% 9.55%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due $400.0M $12.00M
YoY Change 3233.33% 0.0%
Total Short-Term Liabilities $1.572B $1.061B
YoY Change 48.16% -19.68%
LONG-TERM LIABILITIES
Long-Term Debt $3.243B $3.642B
YoY Change -10.96% 0.05%
Other Long-Term Liabilities $288.0M $168.0M
YoY Change 71.43% 28.24%
Total Long-Term Liabilities $3.531B $3.810B
YoY Change -7.32% 1.03%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.572B $1.061B
Total Long-Term Liabilities $3.531B $3.810B
Total Liabilities $5.396B $5.239B
YoY Change 3.0% -3.66%
SHAREHOLDERS EQUITY
Retained Earnings $795.0M $531.0M
YoY Change 49.72% 387.16%
Common Stock $5.000M $5.000M
YoY Change 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost) $100.0M $0.00
YoY Change
Treasury Stock Shares 2.162M shares 13.42K shares
Shareholders Equity $1.176B $1.260B
YoY Change
Total Liabilities & Shareholders Equity $6.598B $6.522B
YoY Change 1.17% 4.17%

Cashflow Statement

Concept 2015 Q2 2014 Q2
OPERATING ACTIVITIES
Net Income -$37.00M $136.0M
YoY Change -127.21% 6.25%
Depreciation, Depletion And Amortization $50.00M $51.00M
YoY Change -1.96% 0.0%
Cash From Operating Activities $122.0M $159.0M
YoY Change -23.27% -1425.0%
INVESTING ACTIVITIES
Capital Expenditures -$275.0M -$42.00M
YoY Change 554.76% -27.59%
Acquisitions
YoY Change
Other Investing Activities $231.0M -$8.000M
YoY Change -2987.5% -233.33%
Cash From Investing Activities -$44.00M -$50.00M
YoY Change -12.0% -3.85%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -91.00M -39.00M
YoY Change 133.33% 21.88%
NET CHANGE
Cash From Operating Activities 122.0M 159.0M
Cash From Investing Activities -44.00M -50.00M
Cash From Financing Activities -91.00M -39.00M
Net Change In Cash -13.00M 70.00M
YoY Change -118.57% -172.92%
FREE CASH FLOW
Cash From Operating Activities $122.0M $159.0M
Capital Expenditures -$275.0M -$42.00M
Free Cash Flow $397.0M $201.0M
YoY Change 97.51% 336.96%

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0 USD
us-gaap Impairment Of Intangible Assets Excluding Goodwill
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0 USD
CY2015Q2 us-gaap Impairment Of Intangible Assets Excluding Goodwill
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2000000 USD
us-gaap Impairment Of Intangible Assets Excluding Goodwill
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2000000 USD
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200000000 USD
us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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427000000 USD
CY2015Q2 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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203000000 USD
CY2014Q2 us-gaap Income Tax Expense Benefit
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61000000 USD
us-gaap Income Tax Expense Benefit
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133000000 USD
CY2015Q2 us-gaap Income Tax Expense Benefit
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9000000 USD
us-gaap Income Tax Expense Benefit
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74000000 USD
us-gaap Income Tax Reconciliation Other Adjustments
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9000000 USD
us-gaap Income Tax Reconciliation Other Adjustments
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6000000 USD
us-gaap Income Tax Reconciliation Prior Year Income Taxes
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6000000 USD
us-gaap Interest Costs Capitalized
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87000000 USD
us-gaap Income Taxes Paid Net
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121000000 USD
us-gaap Increase Decrease In Accounts Payable
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us-gaap Increase Decrease In Accounts Payable
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us-gaap Increase Decrease In Accounts Receivable
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71000000 USD
us-gaap Increase Decrease In Accrued Taxes Payable
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38000000 USD
us-gaap Increase Decrease In Accrued Taxes Payable
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31000000 USD
us-gaap Increase Decrease In Inventories
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40000000 USD
us-gaap Increase Decrease In Inventories
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134000000 USD
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3000000 USD
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30000000 USD
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-100000000 USD
us-gaap Increase Decrease In Other Operating Liabilities
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122000000 USD
us-gaap Insurance Recoveries
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2000000 USD
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us-gaap Interest Costs Capitalized
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us-gaap Interest Expense
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58000000 USD
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us-gaap Interest Expense
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57000000 USD
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57000000 USD
us-gaap Interest Paid Net
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59000000 USD
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261000000 USD
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278000000 USD
CY2014Q4 us-gaap Inventory Work In Process Net Of Reserves
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340000000 USD
CY2015Q2 us-gaap Inventory Work In Process Net Of Reserves
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424000000 USD
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5270000000 USD
CY2015Q2 us-gaap Liabilities
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5396000000 USD
CY2014Q4 us-gaap Liabilities And Stockholders Equity
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6607000000 USD
CY2015Q2 us-gaap Liabilities And Stockholders Equity
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6598000000 USD
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1086000000 USD
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1572000000 USD
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0 USD
CY2015Q2 us-gaap Line Of Credit
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CY2015Q2 us-gaap Line Of Credit Facility Maximum Borrowing Capacity
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82000000 USD
CY2014Q2 us-gaap Litigation Settlement Expense
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13000000 USD
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0 USD
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400000000 USD
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0 USD
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751000000 USD
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0 USD
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401000000 USD
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3000000 USD
CY2015Q2 us-gaap Long Term Line Of Credit
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2000000 USD
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14000000 USD
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11000000 EUR
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us-gaap Loss Contingency Loss In Period
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11000000 USD
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us-gaap Loss Contingency Loss In Period
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CY2014Q4 us-gaap Minority Interest
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us-gaap Net Cash Provided By Used In Financing Activities
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us-gaap Net Cash Provided By Used In Financing Activities
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us-gaap Net Cash Provided By Used In Investing Activities
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us-gaap Net Cash Provided By Used In Investing Activities
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136000000 USD
us-gaap Net Cash Provided By Used In Operating Activities
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182000000 USD
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us-gaap Net Income Loss
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291000000 USD
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us-gaap Net Income Loss
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CY2014Q2 us-gaap Net Income Loss Attributable To Noncontrolling Interest
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us-gaap Net Income Loss Attributable To Noncontrolling Interest
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3000000 USD
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1000000 USD
us-gaap Net Income Loss Attributable To Noncontrolling Interest
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us-gaap Nonoperating Income Expense
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CY2015Q2 us-gaap Number Of Countries In Which Entity Operates
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70
us-gaap Number Of Operating Segments
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CY2015Q2 us-gaap Other Assets Current
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0 USD
us-gaap Other Comprehensive Income Defined Benefit Plans Net Unamortized Gain Loss Arising During Period Net Of Tax
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CY2015Q2 us-gaap Other Comprehensive Income Defined Benefit Plans Net Unamortized Gain Loss Arising During Period Net Of Tax
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0 USD
us-gaap Other Comprehensive Income Defined Benefit Plans Net Unamortized Gain Loss Arising During Period Net Of Tax
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1000000 USD
CY2014Q2 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
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29000000 USD
us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
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18000000 USD
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us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
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29000000 USD
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21000000 USD
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CY2015Q2 us-gaap Other Liabilities Noncurrent
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us-gaap Other Noncash Income Expense
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us-gaap Other Noncash Income Expense
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us-gaap Other Nonoperating Income Expense
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us-gaap Other Nonrecurring Expense
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us-gaap Other Significant Noncash Transaction Value Of Consideration Given1
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us-gaap Payments For Repurchase Of Common Stock
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us-gaap Payments For Repurchase Of Common Stock
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100000000 USD
us-gaap Payments Of Ordinary Dividends
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73000000 USD
us-gaap Payments Of Ordinary Dividends
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CY2015Q1 us-gaap Payments To Acquire Businesses Gross
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229000000 USD
us-gaap Payments To Acquire Businesses Net Of Cash Acquired
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0 USD
us-gaap Payments To Acquire Businesses Net Of Cash Acquired
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us-gaap Payments To Acquire Intangible Assets
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15000000 USD
us-gaap Payments To Acquire Intangible Assets
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us-gaap Payments To Acquire Property Plant And Equipment
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87000000 USD
us-gaap Payments To Acquire Property Plant And Equipment
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91000000 USD
CY2014Q4 us-gaap Preferred Stock Par Or Stated Value Per Share
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0.01
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0.01
CY2014Q4 us-gaap Preferred Stock Shares Authorized
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CY2015Q2 us-gaap Preferred Stock Shares Authorized
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1000000000 shares
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us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Weighted Average Grant Date Fair Value
ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue
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CY2015Q2 us-gaap Preferred Stock Shares Issued
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CY2015Q2 us-gaap Preferred Stock Value Outstanding
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us-gaap Proceeds And Excess Tax Benefit From Sharebased Compensation
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us-gaap Proceeds And Excess Tax Benefit From Sharebased Compensation
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2000000 USD
us-gaap Proceeds From Repayments Of Short Term Debt
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us-gaap Proceeds From Repayments Of Short Term Debt
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us-gaap Proceeds From Sale Of Property Plant And Equipment
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CY2014Q2 us-gaap Profit Loss
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139000000 USD
us-gaap Profit Loss
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294000000 USD
CY2015Q2 us-gaap Profit Loss
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us-gaap Profit Loss
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CY2014Q2 us-gaap Research And Development Expense Excluding Acquired In Process Cost
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92000000 USD
us-gaap Research And Development Expense Excluding Acquired In Process Cost
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179000000 USD
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us-gaap Research And Development Expense Excluding Acquired In Process Cost
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us-gaap Restructuring Charges
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CY2014Q4 us-gaap Restructuring Reserve
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CY2015Q2 us-gaap Restructuring Reserve
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0 USD
us-gaap Restructuring Reserve Accelerated Depreciation
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1000000 USD
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0 USD
us-gaap Restructuring Reserve Accelerated Depreciation
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0 USD
CY2014Q4 us-gaap Retained Earnings Accumulated Deficit
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CY2014Q2 us-gaap Royalty Revenue
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us-gaap Royalty Revenue
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us-gaap Royalty Revenue
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us-gaap Sales Revenue Net
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CY2015Q2 us-gaap Sales Revenue Net
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us-gaap Sales Revenue Net
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us-gaap Selling General And Administrative Expense
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us-gaap Selling General And Administrative Expense
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us-gaap Share Based Compensation
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us-gaap Share Based Compensation
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us-gaap Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions Expected Volatility Rate
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us-gaap Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions Risk Free Interest Rate
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us-gaap Share Based Compensation Arrangements By Share Based Payment Award Options Grants In Period Weighted Average Exercise Price
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us-gaap Sharebased Compensation Arrangement By Sharebased Payment Award Fair Value Assumptions Expected Term1
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P6Y6M
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CY2015Q2 us-gaap Short Term Bank Loans And Notes Payable
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4000000 USD
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us-gaap Stock Issued During Period Shares Employee Benefit Plan
StockIssuedDuringPeriodSharesEmployeeBenefitPlan
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us-gaap Stock Issued During Period Shares Employee Stock Purchase Plans
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CY2015Q2 us-gaap Stock Repurchase Program Authorized Amount1
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500000000 USD
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402000000 USD
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CY2015Q2 us-gaap Stockholders Equity
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CY2013Q4 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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CY2014Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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CY2015Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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CY2014Q4 us-gaap Taxes Payable Current
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26000000 USD
CY2015Q2 us-gaap Taxes Payable Current
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59000000 USD
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CY2014Q2 us-gaap Treasury Stock Carrying Basis
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400000 USD
CY2014Q4 us-gaap Treasury Stock Carrying Basis
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500000 USD
CY2015Q2 us-gaap Treasury Stock Carrying Basis
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99700000 USD
CY2013Q4 us-gaap Treasury Stock Shares
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0 shares
CY2014Q2 us-gaap Treasury Stock Shares
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13420 shares
CY2014Q4 us-gaap Treasury Stock Shares
TreasuryStockShares
14743 shares
CY2015Q2 us-gaap Treasury Stock Shares
TreasuryStockShares
2162145 shares
us-gaap Treasury Stock Shares Acquired
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13000 shares
CY2014Q2 us-gaap Treasury Stock Value
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0 USD
CY2014Q4 us-gaap Treasury Stock Value
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CY2015Q2 us-gaap Treasury Stock Value
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us-gaap Treasury Stock Value Acquired Cost Method
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400000 USD
us-gaap Treasury Stock Value Acquired Cost Method
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98000000 USD
CY2015Q2 us-gaap Unamortized Debt Issuance Expense
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CY2014Q4 us-gaap Unrecognized Tax Benefits
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54000000 USD
CY2015Q2 us-gaap Unrecognized Tax Benefits
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57000000 USD
CY2014Q4 us-gaap Unrecognized Tax Benefits Income Tax Penalties And Interest Accrued
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8000000 USD
CY2015Q2 us-gaap Unrecognized Tax Benefits Income Tax Penalties And Interest Accrued
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8000000 USD
CY2015Q2 us-gaap Valuation Allowance Deferred Tax Asset Change In Amount
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3000000 USD
CY2014Q2 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
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709000 shares
us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
590000 shares
CY2015Q2 us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
0 shares
us-gaap Weighted Average Number Diluted Shares Outstanding Adjustment
WeightedAverageNumberDilutedSharesOutstandingAdjustment
2233000 shares
CY2014Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
501684000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
501193000 shares
CY2015Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
500173000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
502893000 shares
CY2014Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
500975000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
500603000 shares
CY2015Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
500173000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
500660000 shares
CY2014Q2 zts Allocated Share Based Compensation Expense Direct And Indirect Expense
AllocatedShareBasedCompensationExpenseDirectAndIndirectExpense
8000000 USD
zts Allocated Share Based Compensation Expense Direct And Indirect Expense
AllocatedShareBasedCompensationExpenseDirectAndIndirectExpense
13000000 USD
CY2015Q2 zts Allocated Share Based Compensation Expense Direct And Indirect Expense
AllocatedShareBasedCompensationExpenseDirectAndIndirectExpense
11000000 USD
zts Allocated Share Based Compensation Expense Direct And Indirect Expense
AllocatedShareBasedCompensationExpenseDirectAndIndirectExpense
21000000 USD
CY2014Q2 zts Amortization Of Intangible Assets Not Associated With Single Function
AmortizationOfIntangibleAssetsNotAssociatedWithSingleFunction
15000000 USD
zts Amortization Of Intangible Assets Not Associated With Single Function
AmortizationOfIntangibleAssetsNotAssociatedWithSingleFunction
30000000 USD
CY2015Q2 zts Amortization Of Intangible Assets Not Associated With Single Function
AmortizationOfIntangibleAssetsNotAssociatedWithSingleFunction
15000000 USD
zts Amortization Of Intangible Assets Not Associated With Single Function
AmortizationOfIntangibleAssetsNotAssociatedWithSingleFunction
30000000 USD
zts Business Separation Adjustments
BusinessSeparationAdjustments
0 USD
zts Contributed Capital Associatedwith Pension To Be Contributedby Related Party
ContributedCapitalAssociatedwithPensionToBeContributedbyRelatedParty
1000000 USD
zts Contributed Capital Associatedwith Pension To Be Contributedby Related Party
ContributedCapitalAssociatedwithPensionToBeContributedbyRelatedParty
1000000 USD
CY2014Q2 zts Cost Reduction Initiatives And Acquisition Costs
CostReductionInitiativesAndAcquisitionCosts
5000000 USD
zts Cost Reduction Initiatives And Acquisition Costs
CostReductionInitiativesAndAcquisitionCosts
8000000 USD
CY2015Q2 zts Cost Reduction Initiatives And Acquisition Costs
CostReductionInitiativesAndAcquisitionCosts
281000000 USD
zts Cost Reduction Initiatives And Acquisition Costs
CostReductionInitiativesAndAcquisitionCosts
297000000 USD
zts Dedicated Pension Plans Settlement Chargefor Contract Termination
DedicatedPensionPlansSettlementChargeforContractTermination
4000000 USD
zts Investor Related Costs
InvestorRelatedCosts
3000000 USD
CY2013Q4 zts Line Of Credit Facility Covenant Compliance Minimum Interest Coverage Ratio
LineOfCreditFacilityCovenantComplianceMinimumInterestCoverageRatio
3.50
CY2015Q2 zts Long Term Debt Maturities Repayments Of Principal After Year Six
LongTermDebtMaturitiesRepaymentsOfPrincipalAfterYearSix
2500000000 USD
CY2015Q2 zts Long Term Debt Maturities Repayments Of Principal In Year Six
LongTermDebtMaturitiesRepaymentsOfPrincipalInYearSix
0 USD
zts Non Cash Trasfers To Related Party
NonCashTrasfersToRelatedParty
1000000 USD
zts Non Cash Trasfers To Related Party
NonCashTrasfersToRelatedParty
1000000 USD
CY2015Q2 zts Number Of Core Animal Species Marketed
NumberOfCoreAnimalSpeciesMarketed
8 species
CY2015Q2 zts Number Of Major Product Categories
NumberOfMajorProductCategories
5 product_categories
CY2015Q2 zts Number Of Major Product Categories
NumberOfMajorProductCategories
5000
CY2015Q2 zts Numberof Regional Segments
NumberofRegionalSegments
2 region
CY2014Q2 zts Other Comprehensive Income Pension Plan Settlement Charge
OtherComprehensiveIncomePensionPlanSettlementCharge
0 USD
zts Other Comprehensive Income Pension Plan Settlement Charge
OtherComprehensiveIncomePensionPlanSettlementCharge
3000000 USD
CY2015Q2 zts Other Comprehensive Income Pension Plan Settlement Charge
OtherComprehensiveIncomePensionPlanSettlementCharge
0 USD
zts Other Comprehensive Income Pension Plan Settlement Charge
OtherComprehensiveIncomePensionPlanSettlementCharge
0 USD
zts Restructuring And Other Related Costs Net Of Payments
RestructuringAndOtherRelatedCostsNetOfPayments
-5000000 USD
zts Restructuring And Other Related Costs Net Of Payments
RestructuringAndOtherRelatedCostsNetOfPayments
225000000 USD
CY2014Q2 zts Restructuring Charges And Acquisition Related Costs
RestructuringChargesAndAcquisitionRelatedCosts
5000000 USD
zts Restructuring Charges And Acquisition Related Costs
RestructuringChargesAndAcquisitionRelatedCosts
8000000 USD
CY2015Q2 zts Restructuring Charges And Acquisition Related Costs
RestructuringChargesAndAcquisitionRelatedCosts
266000000 USD
zts Restructuring Charges And Acquisition Related Costs
RestructuringChargesAndAcquisitionRelatedCosts
267000000 USD
zts Restructuring Reserve Utilization And Other
RestructuringReserveUtilizationAndOther
38000000 USD
zts Stockholders Equity Net Transfers To Related Party
StockholdersEquityNetTransfersToRelatedParty
29000000 USD
us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-weight:bold;">Organization</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:8px;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Zoetis Inc. (including its subsidiaries, collectively, Zoetis, the company, we, us or our) is a global leader in the discovery, development, manufacture and commercialization of animal health medicines and vaccines, with a focus on both livestock and companion animals. We organize and operate our business in </font><font style="font-family:inherit;font-size:9pt;color:#000000;text-decoration:none;">two</font><font style="font-family:inherit;font-size:9pt;"> geographic regions: the United States (U.S.) and International. </font></div><div style="line-height:120%;padding-bottom:8px;padding-top:8px;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">We directly market our products in approximately </font><font style="font-family:inherit;font-size:9pt;">70</font><font style="font-family:inherit;font-size:9pt;"> countries across North America, Europe, Africa, Asia, Australia and South America. Our products are sold in more than </font><font style="font-family:inherit;font-size:9pt;color:#000000;text-decoration:none;">120</font><font style="font-family:inherit;font-size:9pt;"> countries, including developed markets and emerging markets, and our revenue is mostly generated in the United States. We have a diversified business, marketing products across </font><font style="font-family:inherit;font-size:9pt;color:#000000;text-decoration:none;">eight</font><font style="font-family:inherit;font-size:9pt;"> core species: cattle, swine, poultry, sheep and fish (collectively, livestock) and dogs, cats and horses (collectively, companion animals); and within </font><font style="font-family:inherit;font-size:9pt;color:#000000;text-decoration:none;">five</font><font style="font-family:inherit;font-size:9pt;"> major product categories: anti-infectives, vaccines, parasiticides, medicated feed additives and other pharmaceuticals.</font></div></div>

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