Medtronic
(NYSE: MDT)
today reported first-quarter results that beat the Wall Street analyst consensus, with automated insulin pumps, PFA and neuromodulation among the medtech fueling the beat.
The world’s largest medical device company also nudged up the lower end of its full-year guidance.
Truist analysts described the Q1 beat as modest. MDT shares were up more than 3% to $87.43 apiece by midday trading today. MassDevice‘s MedTech 100 Index was down slightly.
Medtronic — which has its headquarters in Dublin, Ireland but is operationally run out of Fridley, Minnesota — earned $1.042 billion, or 80¢ per share, off of $7.915 billion in revenue for the first quarter that ended July 26, 2024. Profits were up 31.7%, and revenue was up 2.8% compared with the same quarter a year ago.
Adjusted to exclude one-time items, Medtronic had EPS of $1.23. The results were 3¢ ahead of The Street, where analysts expected EPS of $1.20 and revenue of $7.89 billion.
“We executed, exceeded our commitments, and delivered another good quarter. Our underlying markets are healthy, we’re driving operating rigor, and new product innovation is fueling diversified growth across key health tech markets,” CEO Geoff Martha said in a news release. “As we deliver innovation and execute on our transformation, we expect this to translate into strong returns for our shareholders.”
Medtronic Diabetes’ rebound continued; the business’s revenue was up 11.8% year-over-year to $647 million in Q1, driven by continued U.S. adoption of the MiniMed 780G automated insulin delivery (AID) system. Growth could accelerate even more in the future now that Medtronic has a partnership with Abbott to develop a version of Abbott’s FreeStyle Libre continuous glucose monitors (CGMs) that would work exclusively with Medtronic’s automated insulin delivery technology.
“It will also allow us to offer more choice to patients, increase our installed base and grow our diabetes revenue,” Martha said of the Abbott partnership during Medtronic’s first-quarter earnings call.
The cardiovascular portfolio was up 5.5% to more than $3 billion amid strong growth of the PulseSelect pulsed field ablation (PFA) system for treating AFib. PFA has been causing a great deal of excitement in cardiology because of the potential for it to have fewer complications than RF ablation.
“We’re in one of those moments in medtech when a new technology is causing a rapid shift in the treatment of a disease,” Martha said of PFA.
Micra transcatheter pacing systems saw low-20s growth. The Evolut FX+ TAVR system saw a limited commercial release in Q1, with the full market release now underway.
The neuroscience portfolio grew 4.4% to $2.317 billion; company officials are still excited about the continued launch of the Percept RC deep brain stimulator (DBS) with BrainSense technology.
“Last week, we became the first and only medtech company to receive FDA approval to offer DBS surgery to a patient who is asleep. This innovation means a less stressful surgery for the patient and potentially shorter procedure times,” Martha said.
The medical surgical portfolio was down slightly to $1.996 billion.
Medtronic officials said they continue to make progress on the work needed for an FDA submission for the company’s Hugo surgical robotic system. “We’re absolutely committed to this … not just being a part of this, but helping to lead it, as we do in spine,” Martha said of surgical robotics.
Work also continues securing reimbursement wins for the company’s Simplicity Spyral renal denervation system to treat hypertension.
Medtronic adjusted up the lower end of its full-year guidance. It now expects organic revenue growth of 4.5–5.0% and adjusted EPS of $5.42–5.50 for the full year; the previous guidance was 4.0–5.0% and $5.40–5.50.
