Medtronic plc
CEO : Mr. Geoffrey Straub Martha
Quarterly earnings growth(YoY,%)
| Period | Revenue | Operating Income | EPS | Release Date |
|---|---|---|---|---|
| 2025 Q2 | 5.2% YoY | -102.5% | 45.6% | 2024-11-19 |
GeoffMartha says,
Supply Chain Recovery and Expansion
- CAS ablation business faced a supply issue due to a third-party component supplier, which has now been resolved.
- The supplier has expanded capacity, enabling the company to ramp up the PulseSelect supply.
- **Resolution of supply issues is expected to drive future growth, specifically for the PulseSelect product.**
PulseSelect Performance
- The units of PulseSelect doubled in Q2, signaling a strong recovery and demand.
- The number of physicians using PulseSelect also nearly doubled, indicating wider adoption.
- The number of procedures and patients treated with PulseSelect more than doubled.
- **Company has confidence to open more accounts for PulseSelect, projecting continued growth.**
Cryo Business Update
- The cryo business saw a sequential improvement, contrary to previous declines.
- **Q2 showed better performance in cryo compared to Q1, negating earlier concerns.**
Growth Projections and New Developments
- Introduction of Sphere-9 is expected to complement PulseSelect demand and drive growth.
- Strong double-digit growth is anticipated in Q3, supported by the resolution of supply issues and increased demand.
- The company is the only player with both single shot and focal capabilities, enhancing its market position.
| Quarter | Key Product | Growth Metric |
|---|---|---|
| Q2 | PulseSelect | Double in units and procedures |
| Q3 (Projected) | PulseSelect and Sphere-9 | Strong double-digit growth |
Sean Salmon says,
Overview of Market Opportunity
- The base population for uncontrolled hypertension patients treated with drugs but still having elevated blood pressure is approximately 18 million.
- The Medicare population within this demographic is estimated at about 16 million patients.
- The addressable market, including both inpatients and outpatients, comprises roughly half of the Medicare population.
- Medicaid’s market potential varies state-by-state, similar to commercial insurance, indicating a significant but complex opportunity.
Insurance and Reimbursement Dynamics
- The PAIR mix is approximately 50% Medicare and Medicaid and 50% non-Medicare/Medicaid patients, highlighting the diversity of the patient base.
- The therapy specifically addresses the fee-for-service component of Medicare-eligible patients, excluding those on Medicare Advantage.
- Securing coverage is crucial, with a strong emphasis on establishing centers capable of performing the procedure.
Challenges and Considerations
- The minority of patients achieve control over hypertension despite drug availability, indicating an unmet need that this therapy could address.
- Demand is not the issue; the critical focus is on obtaining coverage and expanding procedural centers.
- State-by-state variability in Medicaid decisions adds a layer of complexity to market penetration and modeling.
Financial Implications
| Population | Number of Patients |
|---|---|
| Uncontrolled Hypertension | 18 million |
| Medicare Population | 16 million |
| Addressable Market | 50% of Medicare Population |
- The financial opportunity is significant, given the large untreated population and potential reimbursement pathways.
Q & A sessions,
Market Outlook and Growth Drivers
- The MedTech landscape is described as healthy, with steady procedure growth driven by innovation.
- Key areas of innovation include minimally invasive procedures, pacing technologies, and shifts from drug to MedTech solutions.
- Demographics also contribute significantly to market growth.
- Healthcare remains a priority under any administration, suggesting a stable outlook for the sector.
Impact of Political Changes and Trade Agreements
- Speculation about policies under President Elect Trump is considered premature, particularly regarding healthcare and tariffs.
- Less than 1% of revenue is exposed to imports from China, minimizing the impact of potential tariffs.
Key Product and Segment Performance
- Affera’s approval and integration into PulseSelect contributes to strong double-digit growth in Q3 and beyond.
- Uncertainty around CMS coverage timing despite FDA approval with a broad indication.
- High single-digit earnings growth expected for the back half of the year on a constant currency basis.
Mergers and Acquisitions Strategy
- M&A remains a crucial growth strategy, focusing on tuck-in acquisitions to support high-growth segments.
- Portfolio management is emphasized as an ongoing process aimed at durable mid-single-digit growth and shareholder return.
Product Trials and Pipeline Developments
- Expansion plans include the Intrepid valve trials for U.S. and European approval, targeting mitral and tricuspid positions.
- The new FX+ product, launched in the U.S. and Europe, aims to eliminate coronary access concerns.
- Future modifications of the Intrepid valve are underway to optimize it for tricuspid position.
| Key Segment | Growth Expectation | Key Products | Market Expansion Plans |
|---|---|---|---|
| Minimally Invasive Procedures | Steady Growth | TAVR, PFA | Global Expansion |
| PulseSelect & Affera | Double-Digit | PulseSelect System | Scalability & CMS Approval |
| Intrepid Valve | Approval Trials | Intrepid Valve | U.S. & European Markets |
No bad stock 