
Masimo‘s (NSDQ:MASI) 1st quarter earnings, issued yesterday, missed the mark by just a hair as the company’s increased sales couldn’t outpace lost royalty revenues.
The Irvine, Calif.-based patient monitoring devices maker lost $4.5 million in revenues from Covidien (NYSE:COV) after the pair amended a royalty deal in March of last year.
The deal, inked in January 2011 and taking effect 2 months later, lowered Covidien’s royalty payments from 13% to 7.8% for pulse oximetry products sold in the U.S.
The missing $4.5 million, representing a 39% decline, would have pushed the company to strong earnings growth for the quarter as product revenues saw an uptick.
Read MassDevice.com’s exclusive interview with Masimo CEO Joe Kiani on the med-tech tax.
The company posted earnings of $15.8 million, or 27¢ per diluted share, during the 3 months ended March 31, missing Wall Street forecasts by 1¢.
That’s a 12.4% slide from earnings of $18 million, or 30¢ per share, during the same period last year.
Revenues grew 5.5% to $119.2 million, compared with $113 million during Q1 of 2011.
MASI shares were down 3.6% to $21.55 as of about noon today.