ZTS · 10-Q · 2026Q3 · Full report
ERP Transformation and Compliance
Zoetis Inc. · 2026-11-05 · Importance 23 · Surprise 42
Effective January 1, 2026, Zoetis eliminated the one-month financial reporting lag for International Subsidiaries and changed their year-end to December 31 as part of a multi-year ERP transition. Consequently, International Subsidiaries’ December 2025 results were excluded from fiscal 2026 consolidated results but included in the retrospective application of the accounting change. The company describes the alignment as a preliminary step intended to support more seamless financial consolidation, regulatory compliance and consistent reporting; first-quarter 2026 operational changes also shifted the timing of annual price increases in certain International Subsidiaries, and some December 2025 customer orders were processed in the first quarter of 2026.
Key facts
- Zoetis plans to recast its consolidated financial statements for the twelve months ended December 31, 2025 and 2024 when presented as comparatives in future financial statements. source
- Zoetis states that costs for its business process transformation are incremental, far above historical normal operating-support spending, and are not expected to recur in the foreseeable future. source
- Effective January 1, 2026, Zoetis eliminated the one-month financial reporting lag for International Subsidiaries and changed their year-end to December 31 as part of its multi-year ERP transition. source
- In the first quarter of 2026, Zoetis shifted annual price increases in certain International Subsidiaries so the increases and anticipated customer purchases before them occurred in the same calendar year. source
- Because of the Fiscal Year Alignment, International Subsidiaries’ December 2025 results will be excluded from Zoetis’ consolidated fiscal 2026 results and included in retrospective application of the accounting change to prior periods. source
- Processing of certain Zoetis customer orders from December 2025 was delayed to the first quarter of 2026. source
- Zoetis’ ERP-related business process transformation is a multi-year, major global and cross-functional company-wide program that includes a new ERP system, digital technology solutions and related costs; the Fiscal Year Alignment is part of it. source