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2825 Airview Boulevard

Kalamazoo, MI 49002

March 30, 2023

VIA EDGAR

U.S. Securities and Exchange Commission

Division of Corporation Finance

Office of Industrial Applications and Services

100 F Street, NE

Washington, D.C. 20549

Attention:

 Tracey Houser

 Jeanne Baker

RE:

 Stryker Corporation

 Form 10-K for Fiscal Year Ended December 31, 2022

 Filed February 10, 2023

 Form 8-K

 Filed January 31, 2023

 File No. 001-13149

Ladies and Gentlemen:

Stryker Corporation (the “Company”, “we”, “our” or “us”) is submitting this letter to the Securities and Exchange Commission (the “Commission”) via EDGAR in response to the comment letter from the Staff of the Commission (the “Staff”), dated March 16, 2023, pertaining to the Company’s above-referenced Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “Form 10-K”) and Current Report on Form 8-K filed on January 31, 2023. For your convenience, we have set forth below each of the Staff’s comments followed by the Company’s response thereto.

As part of certain responses, we provide illustrative disclosures to help the Staff understand and evaluate our proposed approach to resolving the Staff’s comments. The disclosures that we ultimately make could change based on the facts and circumstances that exist at the time that we make them.

Form 10-K for Fiscal Year Ended December 31, 2022

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Consolidated Results of Operations, page 13

1.Regarding your discussion and analysis of gross profit, research, development and engineering expenses, selling, general and administrative expenses, operating income, and net earnings, please revise to provide a full discussion and analysis for the US GAAP amounts with any additional necessary discussion and analysis for the non-GAAP measures to avoid giving any undue prominence to your non-GAAP results. Refer to Item 10(e)(1)(i)(a) of Regulation S-K and Question 102.10(a) of the Non-GAAP Financial Measures Compliance and Disclosure Interpretations for guidance.

Response: We respectfully acknowledge the Staff’s comment and advise the Staff that in future filings, we will revise our discussion and analysis for (i) gross profit, (ii) research, development and engineering expenses, (iii) selling, general and administrative expenses, (iv) operating income and (v) net earnings to avoid giving undue prominence to the non-GAAP measures. An illustrative example of our future discussion and analysis for gross profit is included in our response to comment 2. below.

2.Please expand your analyses to quantify the impact of the factors impacting the line items when multiple factors contribute positively and/or negatively to the change or amounts being discussed. Refer to Item 303(b)(2) of Regulation S-K and Section 501.12.b. of the Financial Reporting Codification for guidance. One example is your analysis of adjusted gross profit as a percentage of net sales in which you attribute the decline to (a) increased costs from purchases of electronic components at premium process on the spot market; (b) inflationary pressures related to labor, steel and transportation, (c) inefficiencies from supply chain disruptions, and (d) unfavorable product mix that does not quantify each of these factors. Further, ensure that you are quantifying the impact of new products to net sales at the consolidated and segment levels in accordance with Item 303(b)(2)(iii) of Regulation S-K.

Response: We respectfully acknowledge the Staff’s comment and advise the Staff that in future filings, we will expand our discussion and analysis to describe matters that materially affected reported income from continuing operations and, in each case when practicable, indicate the extent to which income was affected. An illustrative example of our future discussion and analysis of gross profit is as follows:

Gross Profit

Gross profit was $X,XXX and $X,XXX in the three months 2023 and 2022. The key components of the change were:

 Percent net sales

Three months 2022 XX.X %

Sales pricing X.X

Volume and mix (X.X)

Manufacturing and supply chain costs (X.X)

Inventory stepped up to fair value X.X

Structural optimization and other special charges X.X

Medical device regulations X.X

Three months 2023 XX.X %

Gross profit as a percentage of net sales in the three months 2023 of XX.X% was flat to 2022, driven by the benefit of favorable unit volume and higher prices, offset by unfavorable segment mix and increased manufacturing and supply chain costs primarily due to higher raw material costs. We generally expect segment mix to have an unfavorable impact for the foreseeable future as we anticipate more rapid sales growth in our lower gross margin MedSurg and Neurotechnology segment as compared to our Orthopaedics and Spine segment.

Substantially all net sales from new products relate to acquisitions and the impact of acquisitions on net sales growth is disclosed. We are continuously introducing next-generation versions of our existing products and their impact to net sales is reported as a component of volume. In the future, when discussing product introductions, we will clarify whether such introductions relate to new products or next-generation versions of existing products.

3.Please expand your disclosures of the material factors impacting the line items to provide an analysis of the underlying facts and circumstances. Refer to Item 303(b)(2) of Regulation S-K and Section 501.12.b.4. of the Financial Reporting Codification for guidance. One example is your reference to a change in product mix negatively impacting adjusted gross profit as a percentage of net sales without a discussion of what the change in product mix was and whether management expects this change in product mix to continue.

Response: We respectfully acknowledge the Staff’s comment and advise the Staff that in future filings, we will expand our discussion and analysis to describe underlying factors, including any known trends, that have had or are reasonably likely to have a material impact on net sales, income from continuing operations or the relationship between costs and net sales. An illustrative example of our future discussion is included in our response to comment 2. above.

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4.Please tell us why you have not provide a discussion and analysis of operating income at the segment level. In this regard, we note that MedSurg and Neurotechnology’s operating income as a percentage of net sales declined to 25.8% for fiscal year 2022 from 29.4% for fiscal year 2021 without an explanation as to why. Refer to Item 303(b) of Regulation S-K for guidance.

Response: We respectfully acknowledge the Staff’s comment. We believed the discussion and analysis of material factors impacting operating income for the Company were largely applicable to both the MedSurg and Neurotechnology and Orthopaedics and Spine segments, and we determined that further discussion of segment operating income was not necessary to understanding the business. Additionally, the decline from 2021 to 2022 in MedSurg and Neurotechnology’s operating income as a percentage of net sales was further addressed in the Macroeconomic Environment section of Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations (“Item 7”), of our Form 10-K, which describes the impact of inflationary pressures on our MedSurg businesses as follows: “Our operations have been adversely impacted by the inflationary pressures primarily related to labor, steel and transportation costs as well as the impact of purchasing electronic components at premium prices on the spot market. Sales growth in certain products has been constrained by the continuing supply chain challenges and electronic component shortages, especially impacting the capital products in our MedSurg businesses, although the supply chain constraints eased somewhat in the fourth quarter.”

We have considered the additional disclosures that we will make with respect to the illustrative examples provided in our responses to comments 2. and 3., and advise the Staff that in future filings we will expand our discussion and analysis for operating income to include a discussion of material factors impacting segment operating income, including quantifying material underlying drivers of those factors when practicable. An illustrative example of our future discussion and analysis of operating income is included below:

Operating Income

Operating income as a percentage of net sales in the three months 2023 increased to XX.X% from XX.X% in 2022. As discussed above, the increase was primarily due lower research, development and engineering expenses as well as lower selling, general and administrative expenses reflecting cost discipline and lower other acquisition and integration-related charges.

MedSurg and Neurotechnology operating income as a percentage of net sales increased to XX.X% in the three months 2023 from XX.X% in 2022. Orthopaedics and Spine operating income as a percentage of net sales increased to XX.X% in the three months 2023 from XX.X% in 2022. The key components of the change were:

 Percent net sales

 MedSurg and Neurotechnology Orthopaedics and Spine

Three months 2022 XX.X % XX.X %

Sales pricing X.X (X.X)

Volume X.X X.X

Manufacturing and supply chain costs (X.X) (X.X)

Research, development and engineering expenses X.X X.X

Selling, general and administrative expenses X.X X.X

Three months 2023 XX.X % XX.X %

The increase in MedSurg and Neurotechnology operating income as a percentage of net sales was primarily due to an increase in gross profit as a percentage of net sales as discussed above and lower research, development and engineering expenses and selling, general and administrative expenses.

The increase in Orthopaedics and Spine operating income as a percentage of net sales was primarily due to lower research, development and engineering expenses and selling, general and administrative expenses, partially offset by lower gross profit as a percentage of net sales.

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Non-GAAP Financial Measures, page 15

5.We note you have included adjustments for “other acquisition and integration-related” charges and also “restructuring-related and other charges” in your reconciliations for the adjusted, non-GAAP measures. Please provide us with an explanation of what specifically each of these adjustments represent and quantify the components of each of these adjustments for each period presented. Confirm to us that you will provide a more detailed discussion of these adjustments along with quantifying the components of these adjustments for each period presented and that you will also address this comment in your earnings press releases furnished pursuant to Item 2.02 of Form 8-K.

Response: We respectfully acknowledge the Staff’s comment. Other acquisition and integration-related charges are costs incurred in the first 24 months post-acquisition to integrate recently acquired businesses (e.g., the termination of sales relationships, employee retention and workforce reductions, manufacturing integration costs, deal costs, legal entity rationalization and other integration-related activities), changes in the fair value of contingent consideration and specific costs (e.g., stock compensation payments upon a change in control) related to the consummation of the acquisition process. For the years ended December 31, 2022, 2021 and 2020, the charges consisted of the following expenses/(benefits) (amounts in millions):

 2022 2021 2020

Changes in the fair value of contingent consideration $ (135)  $ —   $ 8

Stock compensation payments upon change in control 132   —   35

Deal costs, legal entity rationalization and other 55   59   66

Employee retention and workforce reductions 33   90   50

Manufacturing integration costs 32   16   21

Termination of sales relationships 21   154   14

Total adjustment to operating income $ 138   $ 319   $ 194

Restructuring-related and other charges refer to costs associated with structural optimization and other special charges, which include a distributor termination, employee retention and workforce reductions, the costs of closing manufacturing facilities after the first 24 months post-acquisition, the closure/transfer of certain other facilities (e.g., site closure costs, contract termination costs and redundant costs during the transfers), product line exits (primarily inventory, long-lived asset and specifically-identified intangible asset write-offs), other certain long-lived and intangible asset write-offs and impairments and other charges. We believe that these charges are neither indicative of nor related to our operations, revenue-generating activities or ongoing business strategy. Additionally, the amounts are difficult to predict. As such, their exclusion provides a baseline for analyzing trends in our underlying businesses. For the years ended December 31, 2022, 2021 and 2020, the charges consisted of the following expenses (amounts in millions):

 2022 2021 2020

Certain long-lived and intangible asset write-offs and impairments and associated costs

 $ 96   $ 203   $ 184

Closure/transfer of manufacturing and other facilities

 83   52   49

Product line exits

 80   61   114

Employee retention and workforce reductions

 74   39   39

Distributor termination

 —   —   27

Other special charges

 16   31   45

Total adjustment to operating income

 $ 349   $ 386   $ 458

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We advise the Staff that in future filings and in our earnings press releases furnished pursuant to Item 2.02 of Form 8-K, we will provide additional information about other acquisition and integration-related charges and restructuring-related and other charges. Additionally, the term “restructuring-related and other charges” will be revised to “structural optimization and other special charges.” An illustrative example of our future discussion and analysis is as follows:

Full Year 2023 Gross Profit Selling, General & Administrative Expenses Research, Development

& Engineering Expenses

 Operating Income Other Income (Expense), Net Income Taxes Net Earnings Effective Tax Rate Diluted EPS

Reported     $

 $

 $ $ $ $ $ % $

Reported percent net sales % % % % % nm %

Acquisition and integration-related costs (a):

Inventory stepped-up to fair value

Other acquisition and integration-related

Amortization of purchased intangible assets

Structural optimization and other special charges (b)

Goodwill impairment

Medical device regulations (c)

Recall-related matters (d)

Regulatory and legal matters (e)

Tax matters (f)

Adjusted     $

 $ $ $ $ $ $ % $

Adjusted percent net sales % % % % % nm %

(a) Charges represent certain acquisition and integration-related costs associated with acquisitions, including charges for termination of sales relationships ($X), employee retention and workforce reductions ($X), changes in the fair value of contingent consideration ($X), manufacturing integration costs ($X), stock compensation payments upon a change in control ($X) and other integration-related activities such as deal costs and costs associated with legal entity rationalization ($X).

(b) Charges represent the costs associated with employee retention and workforce reductions ($X), the closure/transfer of manufacturing and other facilities, including site closure costs, contract termination costs and redundant employee costs during the work transfers ($X), product line exits (primarily inventory, long-lived asset and specifically-identified intangible asset write-offs) ($X), certain long-lived and intangible asset write-offs and impairments ($X) and other  charges ($X).

(c) Charges represent the costs specific to updating our quality system, product labeling, asset write-offs and product remanufacturing to comply with the medical device reporting regulations and other requirements of the ne