Earnings call transcript Q1 2024

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Ryan Weispfenning

Good morning, I'm Ryan Weispfenning, Vice President and Head of Medtronic Investor Relations. I appreciate that you're joining us today for our Fiscal 2024 First Quarter Video Earnings Webcast. We're broadcasting to you today from our operational headquarters here in Minnesota where summer is in full force.

Before we go inside to hear our prepared remarks, I'll share a few details about today's webcast.

Joining me are Geoff Martha, Medtronic Chairman and Chief Executive Officer; and Karen Parkhill, Medtronic Chief Financial Officer. the provide ended the and on for remainder will first of our Karen the which quarter, July of and comments results on our outlook Geoff year. fiscal XX, XXXX, segments analysts remarks, prepared take from our and executive After the will the company. our us, sell-side the join from cover each VPs of four that questions we'll Today's program should last about an hour.

and morning, containing our and divisional release issued financial press geographic a we summaries. Earlier this revenue statements

our website on The presentation press that provides be also in presentation We an accessed details can posted earnings release additional or at performance. our earnings on our investorrelations.medtronic.com.

program, actual we make results today's statements. projected may and materially of differ forward-looking statements those from forward-looking During the may in many be statements any considered

to made Additional revenue current filings information and comparisons are currency operations. Unless all do forward-looking from the business differ quarter and periodic in we on we reported in that not are of revenue impact excludes and any otherwise, concerning a organic SEC. other reports and our undertake prior factors contained that first foreign prior year-over-year And comparisons results statements. with say actual which the basis, is the other, on make update we to could stems which as basis year an cause

year. our be non-GAAP or changes or the include all our compared of guidance XXXX earnings in to share non-GAAP quarter references share gains finally, does charges fiscal all References financial quarter quarter not of release during adjustments losses website the basis and to the of that on calendar revenue to revenue our to can on to fiscal sequential And measures found calendar made Reconciliations of would fourth the earnings gains compared as stated. as-reported unless in 'XX EPS be and to second reported an are otherwise at second refer XXXX any or investorrelations.medtronic.com. press

the studio the and let's hear quarter. about head With into that,

Geoff Martha

joining us for you thank and today. everyone, Hello,

We We revenue start another of our are year. mid-single-digit strong organic pleased growth. fiscal delivered and of executed with the quarter

results X% growth driven markets each in were our chain. underlying Our and four fundamentals broad-based of our solid with by innovation, improved much and execution, segments supply delivering

which get on the We also our root transformation of to at great designed held back growth. to make what strides comprehensive is has continue our

decade. large-scale executing drive and particularly supply We're focus and capital, also top megatrends And on artificial to transformation taken allocating fast R&D time, in expect executing at industry portfolio bottom-line create improvements over technology we this for on management and growth to and remain same our our secular on next our And shareholders. and growth programs functional we the as global markets chain value operations, focused will ensure like our And decisively growth the our our continued ongoing as robotics will that quality. focusing together, investments intelligence well we're efforts. durable

combined, revenue now turn Rhythm, from durable And they Surgical We just X% let's of our made to strong largest the Spinal, organic. our QX and these So businesses. and and details established leadership of half growth had results. Cardiac have grew under Cranial quarter businesses up another our positions. of

biologics Aible Starting our growing X% driven and quarter, and best-in-class seeing to great in and we in the continue neurosurgery with Spinal ecosystem. globally equipment our surgeons the had as associated capital and spinal Cranial adopt X% by Aible. of implants technologies, US, growth market-leading another both We're pull-through

robotic our innovative planning Biologics navigation. a X% implants, imaging, differentiated the double-digit navigation X%, AI-enabled high-single-digit globally with customized growth of Neurosurgery US. Spine platform These in technologies. growth surgical in and surgeons and successful patient-specific and along X% and including ecosystem grew strategy results demonstrate And grew robotics Mazor and including in our and StealthStation offering

and to of life rhythm now AVX leadless improve years, Micra launched and CC strong our next-generation with we we and have and continued Now Advanced franchise pacemaker US. a XX had VRX X.X devices longer XX% These X%. moving respectively, the in Microdevices continue grew in the cordless and Cardiac tiny mid-teens XX battery EPs well Pacing, Energy system Technologies. growth traditional drove single than strength we as our conduction beyond an we rollout within and to high-single-digit particular Advanced of growth pacing generation alternative dual-chamber LigaSure We're products. average Surgical diagnostics seeing in and as or had pacing. in battery this previous Sonicision our life Pacing. Supply rapidly grew competing And Surgical, in X. XP Cardiac also to X% of And defibrillation Mid-single-digit solutions our growth we adopt

lead system and conduction XXXX one US XX% is in it approved in for pacing the the the Our quarter. grew only

and the we're in delivers Aurora changer same this ahead, benefits veins. launch EV-ICD preparing game the Looking space. It the Aurora year. pacing to without but a ICD features, heart longevity a later the leads for traditional ICD the is size, or including of

our synergistic performances were Cardiac businesses. quarter, cannula. X% perfusion strength this Surgery in this to Turning quarter. several with and There again notable grew

in new ENT in grew digits DTM availability. part Intellis and vein Brain and drug-coated Peripheral double therapy. and improved growth mid-single grew BrainSense. Our both superficial implants Pain mid-single by grew Aortic Vascular with by both product driven balloons digits double-digit Percept of PC with in Stim and businesses digits, Neuromodulation in with high single-digit Modulation, low driven growth

R&D, And and of just will stimulator, next-generation the And be these grew digits the closed-loop in Mark for and signals respond med-tech of our therapy that growth received had Europe to with we spinal our our well. largest businesses months. of high in synergistic All Inceptiv, secular along cord. really high compete Both they as to in spinal Inceptiv businesses QX. the listen strong the our unlock XX% businesses did last to revenue week, coming up in which incorporates the markets, and single made ECAPs, approval cord in decades available quarters. combined, Medtronic ability CE result

businesses, invest our and We of become in a contributors continue to them future. to to growth part larger durable mix expect these we our the revenue large be and disproportionately in

grew in transcatheter growth XX% including globally, in and the valves Heart, with Starting Japan. growth XX% US XX% Structural

the We see the deployment FX decade. improvements of FX with of continue at in compared valves which Monday, durability. to and ESC, predictable a differentiated the TAVR surgery And and presentation to XX-year our over Evolut space enhanced industry-leading combines NOTION next valve Evolut we're valve. adoption Evolut data to the at will CoreValve look of the forward durability and looking

Pulse We're when of for our and to fueled flow our was Flex which Pipeline treating In we is strong Shield digits subject you Neurovascular, available exclude procurement. mid-single by seeing Global aneurysms, adoption where technology volume-based growth strength market in diversion. is grew the China on continued you the bringing as the catheters Pipeline Vantage Cardiac to flow be way Ablation one focal Solutions of segments. market PFA Field And grew and X%. become anticipated has Ablation diverters. And for single-shot in will technologies both leading in most And know, we medtech.

including high-density in same mapping ablation perform the Sphere-X PFA We're ablation Europe focal limited mapping, system, Affera catheter. for Sphere-X our continuing can catheter. all and the release RF and delivers from market both and

AcQCross market. approval our with PulseSelect, Turning to to PFA one be US system, more billion the to System, With and first catheter, meaningful a become and nav our map Transseptal PFA in $X we're FDA Access companies the with expect our EP fast-growing a Front we the and space. leading with filed Affera catheters the for in player US differentiated catheter of PFA combined poised solution Arctic ablation crowd single-shot

And which robotic rollout pivotal Robotic system. EXPAND progress the our trial to continue Surgical Technologies, we international base to our of differentiated continues installed In sites new plan. increased we've US Hugo in our as we activated URO

a We and in ahead, robotic low expect world. minimally value invasive surgery given for growth the penetration Hugo differentiated of our leading proposition, years to around meaningful driver us the be surgery in the position its

in And around five-minute the Detection a quarter see as is very in MiniMed AID second-generation with Diabetes, corrections the a system strong is for in auto getting the we feedback true and had one XXXG We're system great adjustments we to XXXG technology. and continued world. good only AID markets glycemic Meal difference a in evidence days. to value differentiated our management. up proposition settings this diabetes one our showing as is are XX% real-world within reduction recommended well their two that their getting when our of in that are exceeding And And targets as users users achieving burden or results. feeling indicates demand using

growth from years, by Non-US four increased XX%, driven in highest our And launch. in results US, XXXG adoption and and developed CGM we're seeing the markets the XXXG grew both attachment rates. great momentum

in US our launch pump sales. XXs durable First, drove growth the low

prescribers ADA prescriber our base we've you to in Since seeing had increase XX% XX,XXX at since in with late we're launch. rapidly talked now over we last a Second, June, unique expand.

launch. place very our CGM rates base, only And also conversions. XXXG base, gives XXXG our coming installed Third, drive which getting for we've had demand over finally, the in we're high economics since base an the existing or order half seeing we're installed us in XXXG is accelerating and growth. will And from upgrade our but installed confidence competitive attachment of not

business. real the for Diabetes we're is and the I and with making. at am the the team this underway, is point in of the inflection turnaround just So progress And pleased beginning

briefing dosing As for ADA and systems today smart from moving are positioned to MDI, our through at space see that AID well is June, standalone we either trend. investor intensive you primarily smart in insulin with one we CGM this shared or the we

pumps, durable pens, patch diabetes. ecosystem people programs We sensors assembling importantly, continue only under complete in living this invest differentiated next-generation algorithms company pumps, multiple smart And with the we're technology to for heavily and with development. of

and 'XX guidance it over performance I'll that, turn Karen With fiscal to our raise. our discuss financial Karen? to

Karen Parkhill

Geoff. Thanks,

mentioned, fiscal X% ahead growth As in revenue strong expectations. year Geoff to a we with our coming of start had

X%. coming had the EPS FX. of with and $X.XX, better-than-expected our was also line with above $X.XX from of up good guidance from midpoint non-GAAP range, $X.XX bottom the growth $X.XX operational We on performance This

on durable positioning focused to drive Medtronic We're growth.

that several quarters our breadth as growth we then and talked us. this our the on You've The priority improving remains a the stabilizing and margins quarter on about call, ultimately for gross seen line, of top is revenue last over last notable.

geography, of growing the segments both Geoff And As each emerging in grew business X%. by high digits our and mentioned, US the with developed markets, four digits. non-US single grew mid-single

affected X% and high growth teens China. Emerging in strong in at single-digit impact in growth and VBP better were new with procedure Medical said, later X% in Russia given was the sanctions and Cardiovascular year grew in this That Diabetes. Surgical grew recovery. VBP markets Europe provincial delays Western ongoing some to again quarter by China expected X% than and growth and high

Latin growth Excluding East high-teens China grew growth South and and Southeast mid-teens and in Africa and markets high the in Asia and with teens Asia. in Russia, America the emerging Middle

Turning to margins.

expectations Our of offsetting pricing stable year-over-year inflationary ahead adjusted less-than-expected and with gross and relatively currency, margin from better-than-expected impact pressures. was

drove and outperformance focus above in Puerto management, expectations, particularly Below by law. a basis change our revenue Our operating profit driven in corresponding operating operating tax the on XX.X%, increase was by our increased a basis our margin in G&A XX Rico XXX rate point approximate an line. tax adjusted decrease points, line, driven line, in our change offset by expense. expense The other tax nominal

was So net the earnings. neutral to change

Turning to high-growth, in of prioritizing flow high-return and of to channels, minority our prioritize allocation. do opportunities. cash We XX% partnerships we including strategic in We're investments minimum invest we dividend. disproportionately disciplined free growing a shareholders, as through the same investments, multiple our capital strong acquisitions. innovation At primarily time, organic through and our R&D, returning this

Solutions we of with XX-K, quarter, Care Interventions. We been Monitoring expect joint we active Last continue of focused value. we of fiscal in remains management. to advance also likely the complete businesses. way a high the in sooner, Patient different we'll moved these separation maximize as our We've into on venture evaluating We've types and noted now And half always Renal a to not separate Respiratory and our to spin as it we've if DaVita. bar, first shareholder next business said our year, portfolio a been separation the sets the transactions

you X% range expect now revenue of improved guidance prior direct This in for we're underlying earnings I impact the the additional With and increase guidance and new our currency raising to 'XX guidance. growth segment, our and revenue Now outperformance revenue fundamentals, presentation full our the turning details. from first in of to from X.X%. excludes slide our foreign the quarter fiscal Other guidance. EPS an and year of X.X%, organic We to

to of quarter, the In underlying expect half X.X%. acceleration second well. to revenue as a basis, the an be this a growth in expecting in back in comp-adjusted steady year the of we're over X% the growth quarter. organic represents range the And first we acceleration On

rates, impact recent $XXX on full quarter. $XX based year million fluid, is second favorable million in neutral impact currency currency foreign of of would impact the While the to including a on revenue, have a

the P&L. down Moving

said the year. some us have inflation year. that As the delayed expect currency and the provincial we the we expect fiscal of come before, benefited VBPs to first do quarter pressures this And we in later impact from in

us beginning from better to To see are results fewer, changes the give moving a improve this we're terms. come, are our we're in margin the we run There are our reliably. is that it you efficiently to implementing to examples, will and suppliers supply chain. stabilization and then taking to our more to And operations in more structural drive However, actions drive over factories from global more expect giving gross and strategic time improvements we there. and few

guidance new $X.XX $X.XX to prior a beat. operational continues the in our upside unfavorable $X.XX quarter range year. from we're line, $X.XX. is the The line from at FX first May increase of is currency EPS the increase to This foreign bottom the with $X.XX, later X% of is in to the recent to fiscal quarter guidance rates. projected impact from now based an the diluted the offset as 'XX of The non-GAAP first range include FX the unchanged X% annual range On midpoint, on impact $X.XX raising in an

including second based $X.XX from to the impact expect For X% we EPS recent currency of unfavorable rates. quarter, $X.XX, on foreign a

alleviate like health around appreciate the to focus watching our extend fulfills who that well and It our contributes priorities. to on and change globe. for deliver back to your life employees are truly driving Before results sending is patients I execute it today. on our pain, these to that I'd Geoff, millions focus acknowledge to restore enduring of and mission

Thank Geoff. you. Back you, to

Geoff Martha

you, Thank Karen. Okay.

the to with go I'll few thoughts. we a before questions, Now close analyst

the our growth innovation Diabetes margins. track our stabilization inflation We're in and our in establishing market. lead And supply to chain businesses CRM have beginning countering over and business to We're and expect First, having market We're our we market-leading earlier, progress making and geographies. said and also we're that and impacts QX across start improved was at in our underlying this in in of growth. currency we're an seeing like fundamentals a markets, our and on the businesses are we point And of I executing and then to established improvement expect the year Spine. we're dependable bringing quarters. with digit catalysts time. strong to delivering to a And pipeline, we record mid-single that our in coming over come strength seeing like our several inflection the important

the we're and right building So momentum. on path

businesses. in new this, the global be number of company. advantage our on tackling new capital the We're will in in of and take may the advantages, in lead of And performance-driven a technologies believe across opportunities. dependable less we're implementing allocation we're by causes market large And company, underneath you and taken supply or that a the leveraging partially management priorities our that's the programs operations high-growth or chain world advancing transform ensuring innovations leaders to growth are all visible made to core with now whether past. go culture, how what and the to what our enterprise to root we've scale around the portfolio of our have steps we customers we to how organization centralized driven in executing less We're

led details robotics, Ford VP of Chief Technology this Chief Amazon, Officer role. Washington fill Advanced lead therapies quarter the Innovation patients better a Martin new, consumer to we enterprise, and in where that, before hired technologies on Systems. and this I and he our across we was that accelerate created for Company area, to to ahead was Technology and recently Officer past Motor at more new how quarters at Ken at to Now Space last which Technology position forward of and Ken for AI the experiences will is Ken differentiated look Lockheed customers. robotics like Center leading and the believe our to sharing efforts leverage

to Yes, seeing some for work we see this this as still which, results. an toward a work And to is is our but value benefits more with dividend, growing our delivering durable over extensive of revenue continue winning shareholders. done, in be So for transformation. there's the you should you're creating of time to and growth, earnings expect combined formula a

to going where to move to Q&A analysts possible. get Now to let's as as we're try many

only So limit one to you needed, to follow-up. if just we ask question related a and yourself

Ryan you joining the and want note who businesses I Marinaro, can team additional out Investor that Q&A. and the reach Mike after questions, to the have you the first call. is our to we for also have us today Endoscopy runs Surgical If Relations our time

is as is Now heavy a focus businesses And have lift. Mike MedSurg businesses. we Bob the other White's we on two on the focused PMRI separate, which

And if Surgical you direct on them Endoscopy, or go to PMRI Mike. can questions today, Bob. to questions have So

can With a asking you the instructions that, Brad, question? for please give

Brad Welnick

[Operator is this that being Instructions] recorded. Q&A advised please session be Lastly,

session, Geoff, the Diabetes; Endoscopy EVP few second and President and businesses; the EVP Brett today's and the of of are Sean Surgical President White, Cardiovascular Que EVP Medical portfolio; of Neuroscience of Wall, of EVP the Mike for For Salmon, We’ll Bob to President pause Karen Dallara, Ryan and and President Surgical and and by portfolio; portfolio. queue. President assemble a EVP Marinaro, and the joined

at first We'll ahead. Evercore go from Kumar question take Vijay please the ISI. Vijay,

Vijay Kumar

I here, think much revenue grown of good question. for Do on growth taking customers? Yeah. by growth users customer XX% print Geoff, was new versus upgrading congrats Maybe the here, comp execution. adds? my that's here. one you in Diabetes first this good numbers of XXXG How what existing number. And, on my US this was US Thanks number growth is existing The customers and how know a the update much

Geoff Martha

the first in kind Yeah. mentioned we durable we're really of pleased commentary, and growth of which the range delivery. I profit and time I early Well, with momentum We're a the in on let patients. of think mean attachment and think market seeing there. unique automated outcomes That's Thanks, economics. for Like question. of with the in in rate all, of Diabetes. where have Vijay, I great we just the say me a acceleration this we're prescribers, of increase from. is moving CGM, a our to lot the much a line will impact And really higher trends significant and in comes stages insulin

But So who well. to questions, -- to know, specific turn and Que, down business. a do coming specific those runs nice pipeline I'm you on Vijay's want touch path Que, as to we've as that got answer you the going to questions?

Que Dallara

US Geoff. Thanks, we're the with far. Thanks, so really Yes. the seeing pleased We're Vijay. in momentum

But XXs the both In had MDI well terms new from of cohort it's than driving upgraded. what's highest XX% as new of upgrade base as coming switches. and patients. in process installed that We've have that We've the that's our of in in of AID we're growth more the had years from also US, seeing or existing users low upgrading. patient three the coming growth competitive XXXG growth

Vijay Kumar

Maybe, China? of Thank seeing seeing you're how lot quarter? signs this X what some antifriction because The we're of level quick That’s questions campaign, companies. high would I new pausing here a the Geoff, And in perhaps What anticorruption of have here headlines, you. at was China. A a follow new VBP about impact Maybe up. lot impact device talk of campaign? on helpful, questions this the on Que. in channel just any the

Geoff Martha

and anticorruption you China. Yeah, -- in the VBP so asked about

you with there's actively mean, argue And the not in under which -- that is that on It's cost concerns is VBP. has with VBP volume, any there business. are us kind But recognize team to look, some thus less situation, this insulated hospital to material impact. we're VBPs, pricing And case, seeing our we the price I can which the we're worth out fluid So I on somewhat determined field the a headwind we're the of this also is linkage we're coverage from monitoring there. that out noting pivoting nature. allowed mitigate of is and I'll a to with and say in take bit reliant the to And contracted. anticorruption, far, -- for it distribution, anticorruption

point So no at you campaign about. read the this from impact anticorruption that

feel of mean then VBP, this fully fully kind impact that kind it's And -- of we're regarding all effect our us, year, -- this in we -- 'XX. a I takes it's that here FY -- -- it's guidance. and fiscal impact X.X-year for in been It's

expected, well out pointed the quarter growth slightly -- in still and X%, Karen past to be, it what the China this going but than think we which to As at used commentary, where below get is was higher it's back. we

of this couple these get to single-digit, kind back last As -- us. we to 'XX, FY lap for double-digit of revenue in this growth expect low we areas historical VBP high

FY question. expect the -- look the over growth. revenue more So of positive. out a multibillion this 'XX, now This as last of years answers you negative, dollar get is we forward, the it's a something, as in been has we And again, starting flat, of that get recently tick couple that to for we as company hope up

So that's coming.

Vijay Kumar

Got Thanks. you.

Ryan Weispfenning

take questions, Yeah. question Thanks for next We’ll Vijay. please, the Brad? the

Brad Welnick

The go next please JPMorgan. Robbie from question at ahead. Marcus Robbie, comes

Robbie Marcus

we Congrats up the from guidance good as to X.X% you the the for to think low Great, start end of raised X% or organic Maybe growth X.X%. on about morning. Geoff the a rest Karen, good of quarter. for to year, sales

first the in X% did quarter. You

And what you maybe drive So factors walk why the could rest some affecting growth to going are for what that? above just decelerate the through Thanks. us of year? of is the

Karen Parkhill

really year, start our for was the really of breadth QX and our that pleased great to with it. Thanks we're Yeah. Appreciate performance. question, a Robbie.

'XX beat And guide to of and on that digit sets up talked Geoff had of year, all It's we've in it. As still I've about got. carrying that China, a early our guidance of focused QX procedure volume puts raising that FY us X% Geoff talked mentioned, and the in that the had our to more mid-single We're QX quarter And that X.X%. about it's optimistic X.X%. the solid puts we're recovery. we're had we've guidance We've consecutive the we at growth. some success. and little providing takes on for third

We also had new VBP impacts delayed the late some were May. the expected that And -- to first bigger that expecting the in fiscal we of Russia we're in be in a quarter later year. into the place the in sanctions drag put given

we're in just we and focused on on the But as underlying commitments. feel we're hitting we focused intensely And offsetting our that did about QX, fundamentals. improved good

rest year, each then back of Just the acceleration represents basis, acceleration year continued an quarter comp-adjusted the of half. into on we the And the fiscal expect into acceleration for from QX QX. half on back a the the

So answers hopefully, question. your that

Robbie Marcus

from the upside came Yeah. expansion some or Maybe Margin know on one the you. head reductions had margin. SG&A, in more the quarter Great. margins. just gross you in count. Thank I

So upside back a and there lot. how moving as we towards operating try pre-COVID? gross of think just to much about is about we more out margin how more there margins this how and year Thanks in think SG&A forward, and should going come for we is were where much

Karen Parkhill

given saw margins margin improved in we're on ultimately our focused gross quarter, some margin we're back and Clearly, this year pricing. Robbie. time. question, the We better-than-expected expectations guidance on to have for some on of gross we getting margin expansion currency the full and and levels QX, did pre-COVID Thanks driving But outperformance. that increasing over Yeah.

And of FX this to we China some half little a delayed bit -- saw a the year. and to that FX us expect some timing of some that the to in in improvement we tenders being of due the was impact quarter, bit provincial with back more

and stabilizing focused we in are in our I consolidating we're as a and improvement. continued of where the improvements think margins, and operations out our examples margins. couple on organization. suppliers And our And making we cost drive time, improving global manufacturing drive over So operations mentioned supply chain our we're investments of focused about to on to

will you us And for as on you've line. on a in leverage drive period mentioned, as we're the continue do impact margin us operating line, our focused on long so that SG&A, to seen continuing And of SG&A time. to

Ryan Weispfenning

you, We’ll the take question Robbie. please, next Thank Okay. Brad.

Brad Welnick

ahead. from Securities. The Larry Wells at Biegelsen please comes next question go Fargo Larry,

Larry Biegelsen

Good for for the adcom and feeling we renal in the the about taking this the if approval And are weekend upcoming a given we're for I how panel us pulse Sean, as ramp here think the US the about well. And tomorrow? Thanks weekend. Simplicity recommendation, timelines Symplicity events question. positive you and two guess then Sean, morning. help pulse this Affera the with to denervation. for Affera see second, data the going see data

the are Affera now. above market You able What looking business AFib your guys in about And the how a you going pulse to at are growing Thank right should you. market grow data? we be mid-single digits, looks for like little or bit being the feeling forward? below

Sean Salmon

question, the Larry. for Thanks

for we've post months but exclusively it's the going panel that been four timing, starting the and panel. prospects guess I very tend you with to Obviously, So the see prepared typically, to handicap adcom well not of we're to US I'm things. approval, confident panel. recommendation, three about

Let's say, be that of kind itself, order fiscal prepared the well. front an course, half approval year the we're and of certainly ramp as in in well on second is the going is that timing. by And dictated 'XX pace of reimbursement of with to

forward ablation, as like we're a randomized else's. our the looking results to seeing pulse field trial, you is This everyone as far As know.

And is an point-by-point market a the XX% field distinction and populations bag. be bring market. the So focal the our ablation only for anatomic the XX% being I player well think that studied or comparative us. really to the efficacy compared solution solution both are other will of in cryo to what and And we as has The that about the single-shot is us. will RF anatomic interest solution as is in both of that ablation pulse to

mapping Affera and forward in So bringing both look all PulseSelect catheter and than that's is those to certainly different everything very Sphere-X very world. customers to technologies, there, out we which system, the confident the and else around both

Larry Biegelsen

you. All Thank right.

Ryan Weispfenning

Larry. Thanks,

Next question please, Brad.

Brad Welnick

ahead. Antalffy question next Danielle, go comes please at The UBS. from Danielle

Danielle Antalffy

Hey, so Thanks quite much good the was a And good morning, quarter. everyone. congrats, for question. taking this

maybe Geoff. this probably impacting but more Just GLP-Xs question focus curious, on on would about within areas are know many you How GLP-Xs, a the drugs the quick -- adopted. say on next guys of for I readily this over annoying these guys just devices. medical been is you, next market broadly. as thinking even touched let's year is the years, something you impact more few question that's but an the many, And get a I

Geoff Martha

Sure. Danielle, for interesting. comments the And is and yeah, question. Thanks, it the

it's actually the That modest in having I'd material patients how all, -- we'll bariatric, monitoring our relatively There's our some And class plus could bring of with term, really Longer actually see small part a and physicians Europe the and is but it minimal term, business. surgery the therapy is having us they're space were vast is again, business. funnel. to in business. area majority work an When important drugs bariatric is bariatric you impact don't at device the we've see to one seen impact, though. see how indicates is this term, being GLP-X our like impact initial internal bariatric said, into Diabetes we medical adopted. business. there impact of about, First is modest and -- this work our say of of on impact a optimism X relatively That's I this out. large. dialogue you that small bit GLP-Xs well. point. and do a -- our of in work we've our Type what business And we clinics just we're more as this Short are diabetes, a the Surgery the which And our the overall, No talking part from impact world. analysis seen is We our plays longer therapies of small operate is obesity at this around showing a hearing some is

Danielle Antalffy

thinking about, big area. that, diabetes to follow-up again, quick business. growth one the X just guess I Type then is And a

AID guys pen. an You have

things? Type what your on thoughts so the Thanks are side So X much. diabetes specifically of

Geoff Martha

Thanks. is than headwinds. they're Look, under-penetrated. And Type upside way X we whether patients, think for is Type X more AID or this pretty I there insulin-dependent see

Ryan Weispfenning

Brad. take Thanks, please, next question the Danielle. We’ll

Brad Welnick

The Travis please next from ahead. at Travis, Bank question Steed go America. of comes

Travis Steed

Japan good Hey, is really five-year congrats you've about pretty a on out. quarter. have the I'll your I quarter. the XX% ask stood know five-year much I guess success the curious And had valve versus data double-digit how And new competitor going with growth growth TAVR, soon. data. to then this

the curious sustainable that more quarter? that's one-off Just was if a of in or

Geoff Martha

back valve you competition to performing why the TAVR how business specifics on don't the the quarters, Well, last before first, turn I before our question? is we the it is couple the go you also if over turn are to how with Sean, and relative new of performing over for I pipeline give -- -- are it future. Sean, and pleased that we But

Sean Salmon

the notably. where of been Travis, we've well received a It's Japan launched United Hey, and new Sure. the it. certainly number States geographies and in other launched is valve being

growth thing Japan. which we've that that renal other a lacking got was something we new disease, for drove been Japan in end-stage The indication is

population consideration have signature this on So weekend XX-year forward we long-term XX-year four-year that be data have TAVR that performance. display. And that our first well coming NOTION being more for is the coming been really data. the for and see This study really to it's as reported the we'll But large fall. this then helps course, up our data as of to out look on as will well that yes, data of drive the a device, low-risk of

And performance the traction it's behind of around. durability use of from stand way long-term the lot ease or the the valve the and whether we really a that. acute we're all of getting of it's all So valve, shining

Travis Steed

then of this wait of the Medtronic? spends portfolio helpful. kind things? management to PMRI higher get time you. margin spend, do is we then confirm could more is still Form the the I than profile Thank see more change operating But for need the XX, see on on That's longer can side of comments business overall you And some than other And assume when because sells. take to through we maybe that slightly the to

Karen Parkhill

Yeah. Thanks, Travis.

this maximizing taking that alternatives. evaluate spin read the other and on we've to our And we'll high into and there's that a separate. all we've sets to than time remains bar the think focused way I nothing been we're shareholder along said value, that a likely

And next of not so year, we'll if first half sooner. -- we're expecting to close it fiscal

the it yes, the margins slightly of in higher the terms good when terms company. they see than helps. are XX, And you'll and margins you that Form In of business, Hopefully, of see it. -- we'll

Geoff Martha

well. profile our has a have said, improved continues business probably actually, Karen And strong. dynamics, in competitive the to perform the patient of remained in favor. monitoring bit the it, Like side particularly the And margin

good a and improve. more I business, even I think think numbers can it's these with focus, So

Travis Steed

Great. Thanks a lot.

Ryan Weispfenning

Thanks, Travis.

question please, Next Brad.

Brad Welnick

from go comes question ahead. Matt next Barclays. The Miksic Matt, please at

Matt Miksic

one really question the strong but and lot Hi, about, Difficulty] congrats quarter for Que thanks so on then follow-up. across a There's question [Technical much board. to maybe and a one talk on diabetes

something how with things of I just integrated And to and I the just you the would process and sensor but pump about if here? next-gen and if mentioned ready hear one love could. are about that, to then on that of at the ADA, in question, you're then hints early could programs Geoff next-gen So I progressing And that it's the ask follow-up, talked testing know you AID acquiring patch some about that? if quick even pump any curious share the are way to the

Que Dallara

for your questions. Thanks Yeah.

to As FDA. doing process progressing. very We're precise to time we difficult you of under CGM, marketing have on with know, expect and our that, the [indiscernible] in it's CGM approval, when is that review put generation next line but is the a

the the have clinical XXXG, In for adult terms of enrollment with completed QX. we integration in trial

progress We at we completing expect expect our the close very you, a at difficult well But early and patch, to would the comment we as that peds to stage. of timing. also year. too internal terms it's -- further of on time calendar again, in. details disappoint out terms at at They're the that in clinical enrollment And in trial as of lines. we're in on bit programs. sorry We're specific of there put transaction, stage, this the complete expect making end acquisition the that's But the to EOFlow but end our we progressing this to

Matt Miksic

That's helpful and understandable.

Just one -- sort the seasonality. follow-up on of is

and and year-to-date You've procedure I across what so on. volumes year seen the the over seen been last we've questions Difficulty] of know in number there's surgeries and sector, July [Technical given a

summer of How July should you kind what of sense and any quarter we August, your Thanks. seen Difficulty] expect, usual, expectations than describe which Just for what your here? into built fiscal QX but are would normal. you softer [Technical seasonally what in you've

Karen Parkhill

of that the July So and few I seen the weeks would what are in just Travis, tracking first we've say, quarter well.

We of our the tracking it's set performance continue underlying to in and have the expectations strength in guidance. we

Matt Miksic

That’s fair. thanks All so right, much.

Ryan Weispfenning

take Thanks, next Matt. the question please, We’ll Brad.

Brad Welnick

comes question go Chris Chris, from next at Nephron. please The Pasquale ahead.

Chris Pasquale

you then follow-up Hey. Geoff, for one for and quick Karen. a

you of a businesses mentioned there? Could in of market which topic the AI obviously as the Maybe in any you relevant near being you see hot most the intelligence work about are Medtronic is broadly. talk future? for areas one as the artificial doing more It's You in. investing guys provide examples

Geoff Martha

have the and quantity, we're to the over -- the data is the where they you're from has for deep where the couple in products combine medical and got just is these bodies the like here through -- you a AI a huge seeing intend even it's a you that time Rhythm the of ability AI engineering just the properly, specifically, these the first regulatory what kind not of of good we of intersection other access. businesses that learning, AI call analytics for lead around personal in. it by opportunity And to are plan is first-of-their-kind, and connectivity improved AI approved data, labeled of that number in quality of is industry. biomedical received and GI, it. control Well, technologies, world. have efficacy and have over approval us what AI a we've data The device AI-powered traditional the regulatory industry, think to FDA improve with evolve areas the predetermined and Cardiac FDA when outcomes these -- solutions the personalize that just efficacy And we're improved are allowed be space, like and time. robotics, seeing -- like but all, Spine, Sure. in whether even improve the digital just data This techniques I for that all of with the change kind or

with I the it's good were significant economically a kind is the have of and more aligned you a find amount as in obviously patient And AI mentioned, impacted, polyps like businesses And that of some where is colonoscopy, Endoscopy high traditional now we are polyps calling of there's cancer GI correlation are colonoscopies colon hospital's from them. this polyps the it's -- AI interest and because and you're remove redefining that outcomes the also our these for cancer to finding physicians missing. where space, polyps

powering AI degen, it's here, And is or -- sure] training. be outcomes improving enabling that's whether a AI And that’s with is and reliant with (ph), transformed navigation is -- and talk And complex by thousands and especially we is Another instruments, This completely combined an technology each our business. have powered robotics but enabling this surgery, and algorithm. technology. AI Spine being and is cases. surgeon especially enabling just when deformity about Highly really Spine AI redefined area of -- and redefined of imaging [for on industry our piece our key by we complicated surgeries in a the it technology. in

using rhythm these and cardiac for around business down so monitoring we technology. of on, creating really false country positives our XX% -- AI, hours clinics are and there, and that's monitoring, deployment go this cutting could in the our by the in productivity driving AFib for of LINQ I detecting that given -- multiple

what, about businesses differentiator. I our talked big years some is I'd in going So surgeons, right surgeons technology, all who going is with us AI tech hired opportunity. help and mentioned with Ken And better it's huge middle but We've -- are this be be It's next replacing end, over in of the partnership we be replacing companies. new use a you the to you replacing say that Washington, say to we across to that we're head our mix. AI of be really may and not to tell of NVIDIA. see I'll surgeons will the couple not partner what going a a I'd scale don't

Chris Pasquale

margin us the Thanks. Those for a a you across contributor gross mentioned what into as to price Karen, Could price in sense strength you are great like give looks quarter. examples. just the it's today? to a if going where you years think that And we company of compares were forward? ago? a as couple move it Maybe sustainable less you the environment how inflationary

Karen Parkhill

Yes. Thanks for the question.

these focused talk going neutralize well we've we move level. we've to even By how be built fully neutralized continuing quarter, about year. last pricing, ensuring every been muscle muscle including continue of neutralize to have the you've VBP we've XXX is would had that been this points pricing And able we built. on But a heard pretty environment, the were so year, this pricing to And us. obviously that that last we And on pressure lasting. total pressure on believe we lower that we it quarter. to strong into we a we're years, value basis for may year, We deliver. and inflationary of VBP we as focused to hits couple depending have monitor, about, fully not that we experience company muscle building able as pricing track, us that at we're that talk to do intend this price pricing. As pre-COVID, Typically, up historically, be around that this

Geoff Martha

not we'll been the repeat that. I'm But of reemphasize to that -- went margins. and to want kind there we've last that margins, question earlier, on gross margins, just there on into on I detail, going a On muscle building. gross was start pricing point Karen

about get from getting our productivity we and and think margin. And I that over of global structure, really new operations by strategy really we're then intend you improvements Karen in margins and sold supply enduring. line, around to focused chain. our sold on and That capabilities goods leverage will of gross help time. P&L, stabilizing goods down the the making, SG&A driven improving cost be then mentioned the And cost we're as that our excited all

Ryan Weispfenning

Chris. We’ll Okay. take question the Thanks please, Brad. next

Brad Welnick

The next at please go question James. Jayson, comes Raymond from Jayson Bedford ahead.

Jayson Bedford

morning. Good you hear me Can okay?

Geoff Martha

Jayson. Yeah, We can hear you.

Jayson Bedford

right. Thanks. All

around make to not a have did all a I this gross margin, but call So question.

You fiscal What the 'XX? is wanted context mentioned stabilization. gross expected for a I margin little just that. around to put

Karen Parkhill

And At be this point some -- when we guidance May, carrying XX.XX%. we expected around it this at We've be we're and through. to some to gave XX.XX%. about we quarter, point, in of seen our in back the we're said first improvement expecting that it

Jayson Bedford

the a Is in Okay. is VBP of And first just, half? more rest strictly the hitting back levels, Karen, the just versus quarter for year the impact the this drop revenue higher. of down function

Karen Parkhill

helps Yes, about. it's have currency. both we on the some VBP we higher on that revenue clearly seen front. and talked growth But you're margin timing right, VBP And

that we also as down We P&L we quarter, It look forward. of impact some FX. on the better timing was back than and going at have expect expected some the give to first in bit we the little currency a

Jayson Bedford

Thank you.

Ryan Weispfenning

Thanks, Jayson. questions. more we have two Brad, I think time for

Brad Welnick

Weunsch The next question go Citi. ahead. from please comes Joanne Joanne, at

Joanne Weunsch

And on And activating thoughts States. placements in talked Hugo, of whether fiscal me you. United the some on you can or have which questions. I'd very then on you give update new up not way you in be Thank medtech year. the catching just the your thank And or us about wonder or we've normalized sort season taking been robotic launch start to Can a nice would throughout new demand. you timing quick to quite as the morning. we're appreciated. for else base strong, the much of for then maybe Good seen a question on add opinion leads for pent-up US? quarter love nice this and Volumes, that. sites to OUS Two anything an

Geoff Martha

Mike Hugo from Marinaro Thanks Sure, questions. then to good to first the to you. and take I'll one, hear the turn I'll Joanne. over Yeah, for the it handle questions.

we're we're pre-COVID procedure and very pre-COVID I'll about across they're largely so. improved, in and seeing mentioned the back better. mentioned, US procedural we're better. we're think up Karen definitely in levels are -- as I board, start But to trends, trends, I the where or good on or commentary, the X%

pre-COVID procedural As or you have getting say, those and said, broad-based better staffing seem held know, by I'd And know, even we're back I back XX levels. the like has have abated. are and over bit the rebound or last, to so, pickups don't pretty to been, a months I issues

the markets. China teens teens. the China base in high see The you -- as Western in I'd like Latin it's just -- we've pull you this which some like America, kind single VBP, when 'XX. we In And is if to swing. before, of the out take the and we're out say 'XX, definitely And mid-teens here then back to you growth in market Europe digits. outside get even China, of high seen for and the pull the -- teens you US, with is get recovery emerging Europe, stabilizing before. full sanctions, you in stronger. Russia got like I our actually FY emerging high in FY year out VBP into -- -- our is But higher And if said

America Latin a standout, I Europe. mentioned trends as emerging are So strong. markets Western

We're like flow It's in. demand. there's seeing area we're areas in the -- like this trends. I've at versus it heard some not So been a we're like we're pent-up been pretty demand. good in a But seeing pent-up in, not orthopedics, areas least a steady the

So the I think that's industry. good news for

to our as which formerly called up Surgical and or the well. business who questions, business, Mike over turn Marinaro, like I'd endoscopy him On GI to to runs reports Hugo includes Hugo also our it

Mike Marinaro

quarter. continue for making the here that to enrollment the pleased progress we quarter, we've Europe, again and continue encouraged that the about here our progress in did true installations Joanne. we study. this Thanks progress now North regions seeing Western we've across sites URO seen question, on and specifically making And with progress the selling in in America and the And and five in had broadly, continue comment plan that's Asia, added we're to good and the to this program. as Yeah. our More US, there quarter. EXPAND we're the really around progress China, LatAm, Greater be and globe. Canada. into We're we increased sites We're according moved

we've importantly, an approvals. I increasing also steady think or flow a seen of indication increasing flow

surgery received the Japan. in indication general we So

largest we markets which now around approvals of have full so globe. both And gynecology and the urology a across are suite Western of general surgery, and two in Japan Europe, the

and Of US more Overall, Surgical we on. is remain important become that part largest is the one contributing growth focused quarters, business here more we're to our business will of and seen seeing couple we've in we forward. now incredibly across and that's it the the growth move the Hugo the course, of last as in a

Geoff Martha

us very large about going years. much up business for there And a business. supply robots trial. pretty geographic where -- forward two walk update indication one expansion expansion the It's an where The are kind out robot, spot. about we with that excited look and competitors, And good have like really over we're feeling setup dynamics got without. with we the couple on Surgery. competitive Yeah, the the I of for issue, one capacity the and been US major of set that's a just next better We and the our in might has through

Ryan Weispfenning

to question, in given Brad. queue, Joanne. see apologize time all be I Thanks, We've number the a still and of for got to today, able people I timing. won't of that more please, get one we you

Brad Welnick

from ahead. Stanley. at comes Our question Patrick, final Patrick please Wood go Morgan

Patrick Wood

seeing timing. obviously cost one the side. that you on but are so supply the for don't -- difficult just challenges there's the curious, Are rationalization in typically, we upfront work costs of that's much. a the next, when know, short-term say, that, it I'll Thank doing given lot and is with business. I'm Just chain put S&OP guys to and like Fabulous. dual obviously or is how payback going in not understand any to to processes kind two? your place, kind let's a associated you slight in I you and topic, come year keep people sexy very running us of and transition. help of Thanks. it's looking or systems where

Geoff Martha

question place us. know off been focus a by people me your Medtronic of let just for thousand area I saying, that I chain. on supply pretty Well, it that we're the sexy to start do To question. think It's And appreciate work to big it's at a question, over a couple turn be cost proud pretty Karen answer of and doing. the on I'll are the

Karen Parkhill

expect up. are more Hopefully, inflation down over gross stable. than not margins gross those Thanks, to drive and our included on processes work part and Yes, the driving yet as investment. the helpful. does margins pay time bring That it investment Yeah. reason when to our we improving better we help -- and cost investments of off in given guidance is we're fully costs Patrick. working we've is that's down, that take that But to it's

Patrick Wood

Amazing. Thank you.

Ryan Weispfenning

Okay. with Thanks, ahead Patrick. Geoff, remarks. closing please go your

Geoff Martha

forward our your appreciate questions. you continued earnings and of your Medtronic. always, continued we everyone, anticipate our on And QX support first the Tuesday, XX. on November we interest in on progress which for broadcast, look all, thanks, And Well, as holding we to updating

your rest day. thanks that, great and today, of again With joining have us for a

Medtronic (MDT) 22 Aug 232024 Q1 Earnings call transcript