v3.20.1
Equity
 3 Months Ended
Mar. 31, 2020
Stockholders' Equity Note [Abstract]  
Equity Equity
 
Stock-Based Compensation
Stock-based compensation expense is principally related to awards issued pursuant to the AbbVie 2013 Incentive Stock Program and is summarized as follows:
 
 
Three months ended
March 31,
(in millions)
 
2020
 
2019
Cost of products sold
 
$
15

 
$
15

Research and development
 
92

 
72

Selling, general and administrative
 
112

 
102

Pre-tax compensation expense
 
219

 
189

Tax benefit
 
39

 
33

After-tax compensation expense
 
$
180

 
$
156


Stock Options
During the three months ended March 31, 2020, primarily in connection with the company's annual grant, AbbVie granted 2.0 million stock options with a weighted-average grant-date fair value of $12.14. As of March 31, 2020, $16 million of unrecognized compensation cost related to stock options is expected to be recognized as expense over approximately the next two years.
RSUs and Performance Shares
During the three months ended March 31, 2020, primarily in connection with the company's annual grant, AbbVie granted 5.0 million RSUs and performance shares with a weighted-average grant-date fair value of $94.29. As of March 31, 2020, $548 million of unrecognized compensation cost related to RSUs and performance shares is expected to be recognized as expense over approximately the next two years.
Cash Dividends
The following table summarizes quarterly cash dividends declared during 2020 and 2019:
2020
 
2019
Date Declared
 
Payment Date
 
Dividend Per Share
 
Date Declared
 
Payment Date
 
Dividend Per Share
02/20/20
 
05/15/20
 
$
1.18

 
11/01/19
 
02/14/20
 
$
1.18


 

 


 
09/06/19
 
11/15/19
 
$
1.07


 

 


 
06/20/19
 
08/15/19
 
$
1.07


 

 


 
02/21/19
 
05/15/19
 
$
1.07


Stock Repurchase Program
The company's stock repurchase authorization permits purchases of AbbVie shares from time to time in open-market or private transactions at management's discretion. The program has no time limit and can be discontinued at any time. Shares repurchased under this program are recorded at acquisition cost, including related expenses, and are available for general corporate purposes.
Under this authorization, AbbVie repurchased 6 million shares for $500 million during the three months ended March 31, 2020 and 4 million shares for $300 million during the three months ended March 31, 2019. AbbVie's remaining stock repurchase authorization was approximately $3.5 billion as of March 31, 2020.
Accumulated Other Comprehensive Loss
The following table summarizes the changes in each component of accumulated other comprehensive loss, net of tax, for the three months ended March 31, 2020:
(in millions)
Foreign currency
translation adjustments
 
Net investment
hedging activities
 
Pension 
and post-employment
benefits
 
Cash flow hedging
activities
 
Total
Balance as of December 31, 2019
$
(928
)
 
$
9

 
$
(2,965
)
 
$
288

 
$
(3,596
)
Other comprehensive income (loss) before reclassifications
(227
)
 
78

 
8

 
4

 
(137
)
Net losses (gains) reclassified from accumulated other comprehensive loss
—

 
(6
)
 
48

 
(6
)
 
36

Net current-period other comprehensive income (loss)
(227
)
 
72

 
56

 
(2
)
 
(101
)
Balance as of March 31, 2020
$
(1,155
)
 
$
81

 
$
(2,909
)
 
$
286

 
$
(3,697
)

Other comprehensive loss for the three months ended March 31, 2020 included foreign currency translation adjustments totaling a loss of $227 million, which was principally due to the impact of the weakening of the Euro on the translation of the company’s Euro-denominated assets.
The following table summarizes the changes in each component of accumulated other comprehensive loss, net of tax, for the three months ended March 31, 2019:
(in millions)
Foreign currency
translation adjustments
 
Net investment
hedging activities
 
Pension 
and post-
employment
benefits
 
Marketable
 security activities
 
Cash flow hedging
activities
 
Total
Balance as of December 31, 2018
$
(830
)
 
$
(65
)
 
$
(1,722
)
 
$
(10
)
 
$
147

 
$
(2,480
)
Other comprehensive income (loss) before reclassifications
(103
)
 
65

 
5

 
7

 
5

 
(21
)
Net losses (gains) reclassified from accumulated other comprehensive loss
—

 
—

 
20

 
—

 
(35
)
 
(15
)
Net current-period other comprehensive income (loss)
(103
)
 
65

 
25

 
7

 
(30
)
 
(36
)
Balance as of March 31, 2019
$
(933
)
 
$
—

 
$
(1,697
)
 
$
(3
)
 
$
117

 
$
(2,516
)

Other comprehensive loss for the three months ended March 31, 2019 included foreign currency translation adjustments totaling a loss of $103 million, which was principally due to the impact of the weakening of the Euro on the translation of the company’s Euro-denominated assets.
The following table presents the impact on AbbVie’s condensed consolidated statements of earnings for significant amounts reclassified out of each component of accumulated other comprehensive loss:
 
Three months ended
March 31,
(in millions) (brackets denote gains)
2020
 
2019
Net investment hedging activities
 
 
 
Gains on derivative amount excluded from effectiveness testing(a)
$
(8
)
 
$
—

Tax expense
2

 
—

Total reclassifications, net of tax
$
(6
)
 
$
—

Pension and post-employment benefits
 
 
 
Amortization of actuarial losses and other(b)
$
61

 
$
25

Tax benefit
(13
)
 
(5
)
Total reclassifications, net of tax
$
48

 
$
20

Cash flow hedging activities
 
 
 
Gains on foreign currency forward exchange contracts(c)
$
—

 
$
(40
)
Gains on treasury rate lock agreements and interest rate swap contracts(a)
(7
)
 
—

Tax expense
1

 
5

Total reclassifications, net of tax
$
(6
)
 
$
(35
)
(a) Amounts are included in interest expense, net (see Note 8).
(b) Amounts are included in the computation of net periodic benefit cost (see Note 9).
(c) Amounts are included in cost of products sold (see Note 8).