Bengaluru: Medtronic surpassed Wall Street expectations for third-quarter profit and revenue on Tuesday, buoyed by strong demand for its heart devices.
But shares of the company were down 2.9% in premarket trading after it maintained its fiscal 2026 adjusted per share profit forecast at $5.62 to $5.66.
J.P. Morgan analyst Robbie Marcus said he expects “to see some scrutiny,” as the outlook was reiterated despite the quarterly beat and an around 100-basis-point benefit from foreign exchange, adding that this implies lower underlying growth for the fourth quarter.
Medtronic’s growth drivers include its pulsed field ablation systems and its transcatheter aortic valve replacement devices, two minimally invasive technologies for heart conditions that are seeing rapid adoption.
Sales in the company’s cardiovascular segment, which accounts for nearly 40% of sales, jumped 13.8% to $3.46 billion during the quarter, powered by strong demand for its pulsed field ablation portfolio.
The technology uses high-energy electric pulses to destroy targeted heart tissues to reduce the frequency of abnormal heart rhythms.
Medtech firms are benefiting from surging demand for medical procedures as health insurers report higher medical loss ratios – an indication that patients are availing more procedures. Market optimism is also boosted by wider physician uptake and technological advances.
Revenue for the third quarter came in at $9.02 billion, beating analysts’ average estimate of $8.91 billion, according to data compiled by LSEG.
Sales in the company’s neuroscience segment, which makes spinal implants and software, rose 4.1% to $2.56 billion, but missed estimates of $2.59 billion.
On an adjusted basis, the company reported quarterly profit of $1.36 per share, above estimates of $1.33 per share.
Larger peer Johnson & Johnson posted a 7.5% year-over-year increase in medtech sales in the reported quarter, driven by strength in its electrophysiology segment that includes its heart devices.
(Reporting by Padmanabhan Ananthan and Puyaan Singh in Bengaluru; Editing by Sahal Muhammed)
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