First-quarter profits for Edwards Lifesciences (NYSE:EW) rose nearly 40% even excluding a 1-time gain from a legal settlement with heart valve rival Medtronic (NYSE:MDT) and an R&D tax gain, but after-hours investors still punished EW share prices tonight, as the medical device company missed its own sales targets and lowered its outlook for the rest of the year.

Irvine, Calif.-based Edwards reported profits of $144.9 million, or $1.24 per share, on sales of $496.7 million during the 3 months ended March 31, for a top-line gain of 8.2% and bottom-line growth of 122.6%.

But excluding the $83.6 million gain from a patent infringement win over Medtronic and another $7 million added via the reinstatement of a research & development tax credit, adjusted earnings per share were still 72¢, a healthy 35.8% increase over Q1 2012.

But the sales numbers missed even the low end of Edwards’ prior annual sales forecast of $2.1 to $2.2 million, prompting the company to lower its outlook for the rest of 2013. Edwards said it now expects sales of $2.0 billion to $2.1 billion this year, chairman & CEO Mike Mussallem said in prepared remarks.

So, despite the solid comps for year-on-year growth, investors slashed some 14% from EW shares tonight in after-hours trading, pushing prices down to $71.20 apiece from an $82.81 close.

"Our THV clinical results continue to be very positive and we are making good progress on our pipeline of new products that we believe will enable us to strengthen our leadership position. Yet, as global sales this quarter across product lines were below our expectations, we are lowering our 2013 guidance primarily to reflect a slower start to the year and an updated foreign exchange impact," Mussallem said. "We now expect our 2013 global THV sales to grow 25 to 30% on an underlying basis. This would result in expected sales of $670 million to $750 million, which includes $350 million to $400 million of sales in the U.S."

Mussallem said Edwards expects to log adjusted EPS of $3.00 to $3.10 for the full year and between 75¢ and 79¢ for the 2nd quarter, on Q2 sales of $500 million to $530 million.