Parkhill elected to resign from the medtech giant to accept the role of CFO for HP. She spent eight years at Medtronic, according to a news release.
“It has been a pleasure to serve Medtronic and our mission for the last eight years,” said Parkhill. “I am grateful to have had the opportunity to lead the outstanding finance team at Medtronic, and I know they will continue to deliver on our commitments. I remain excited about the plans Medtronic has for the future, and most of all, the huge impact Medtronic technologies will have on the lives of patients around the world.”
At more than $35 billion, HP’s market cap is about a third of the size of Medtronic’s. However, HP stock is up nearly 69% over the past five years. Medtronic’s stock declined more than 18% in value during the same time period.
MDT shares were down more than 1% to $79.47 apiece this morning on the news of Parkhill’s exit; the S&P 500 was down slightly.
Medtronic said it intends to evaluate internal and external succession candidates. Parkill’s departure goes into effect on Aug. 2. She will continue serving as CFO until that date. The company tapped Gary Corona, SVP, global financial planning and analysis, to serve as interim CFO upon her departure.
The company also reaffirmed the financial guidance for both its first quarter and fiscal 2025 released last month.
“On behalf of our employees, our executive committee and our board of directors, I want to thank Karen for her leadership over the last eight years. I am personally grateful to Karen for her support through my transition to CEO, navigating the pandemic and delivering a new operating model for the company. We wish her all the best as she takes on the next chapter of her career,” said Geoff Martha, the medtech giant’s chair and CEO. “Across the company, we’re building momentum with our innovation-driven growth strategy, and we remain focused and committed to delivering on our short- and longer-term financial objectives.”
Our sibling publication Medical Design & Outsourcing featured Parkhill and the role she played navigating Medtronic through the pandemic on the cover of its January 2022 Leadership in Medtech issue.
Parkhill was Medtronic’s second-highest-paid executive in the company’s most recent disclosure of executive compensation.
The analysts’ view on Parkhill’s resignation
Truist analysts Richard Newitter, Samuel Brodovsky, Ravi Misra and Benjamin Goldstein retained a “Hold” rating for Medtronic following the announcement of Parkhill’s departure. They expect more details on the company’s first-quarter earnings call in August.
The analysts wrote that they “remain on the sidelines without increased confidence in estimate upside potential and margin expansion execution.”
Pending more visibility into the company’s EPS acceleration, Truist prefers other large-cap companies.
The analysts wrote:
Any CFO change naturally sparks a degree of uncertainty, but this appears to be fairly benign/explainable (Ms. Parkhill pursuing another opportunity). We appreciate that there could be some investor angst until a permanent successor is announced and ‘reblesses’ recently-issued guidance, and think investors are looking for a CFO that has a track record of delivering margin expansion, particularly given Medtronic’s slow progress driving increasing profitability, which has been a confounding area for prior executives and source of frustration for investors.”
Another departure at Medtronic
Parkhill joins a number of high-ranking officials who have left Medtronic over the past several months. The world’s largest medical device company is experiencing major changes, including portfolio management moves such as shuttering Medtronic’s ventilators business, layoffs and last year’s early retirement program, greater expense discipline, and increased use of automation and digitization. At the same time, the company says it has made strategic R&D investments to support future growth.
This month, the company confirmed the coming retirement of EVP and Global Regions President Rob ten Hoedt. Endologix recently tapped two of the company’s former leaders to join its C-suite, filling the CCO and COO roles.
Last month, Bonnie Handke — most recently VP of global health economics, policy and reimbursement for Medtronic’s coronary and renal denervation, peripheral vascular health, structural heart, and aortic and cardiac surgery businesses — joined CVRx.
Medtronic’s former SVP of corporate development, Christopher Cleary, left in March after 10 years. Also in March, Gio Di Napoli, president of the company’s Gastrointestinal business, announced his departure.
Another Medtronic business unit leader, Ariel Mactavish, president of the company’s Respiratory Interventions unit, also announced that she was leaving the company in March. That move came after Medtronic shared plans to exit the ventilator market in February, also coinciding with the departure of Bob White, EVP and president of the Medical Surgical portfolio for Medtronic.
