Medtronic MDT ITALY — Increase (Decrease) in Contract with Customer, Liability

classified as other accrued expenses, and $683 million of distributor chargebacks were classified as a reduction of accounts receivable in the consolidated balance sheet. At April 25, 2025, $983 million of rebates were classified as other accrued expenses, and $680 million of distributor chargebacks were classified as a reduction of accounts receivable in the consolidated balance sheet. During the three months ended July 26, 2024, the Company recognized $90 million of incremental Italian payback accruals resulting from the July 22, 2024 rulings by the Constitutional Court of Italy relating to certain prior years since 2015. During the three months ended July 25, 2025, the Company decreased its accrual for the Italian payback by $39 million resulting from the June 30, 2025 legislative decree published by the Italian government and formalized into law in August 2025 confirming a reduction of the amounts due for years 2015 to 2018. The changes in estimates related to the Italian payback accruals were recognized as adjustments to net sales in the consolidated statements of income. Refer to Note 16 for additional information. Other adjustments to variable consideration during the three months ended July 25, 2025 and July 26, 2024 were not material.