MDT - Earnings call 2 2024

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Ryan Weispfenning

Good morning. Welcome to a crisp fall morning here in Minnesota. I'm Ryan Weispfenning, Vice President and Head of Medtronic Investor Relations. And I appreciate that you're joining us this morning for Medtronic's fiscal '24 second quarter video earnings webcast.

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

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

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

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

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

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

revenue quarter compared in 'XX, an individual stated. References are calendar third to impact of and to the XXXX to as-reported quarter calendar the share revenue a segment to share unless gains and the on or references of third quarter or of compared otherwise losses the refer XXXX last company on There X changes were first all made sequential basis quarters significant in growth. no quarterly to revenue had acquisitions total made fiscal that

website And be press non-GAAP our gains investorrelations.medtronic.com. adjustments any guidance fiscal at be non-GAAP EPS in of all reported as or on our can include financial earnings earnings measures the finally, year. during charges Reconciliations would that not found our release or to does

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

Geoffrey Martha

for everyone, was today. and Medical digits mid-single with across us multiple and Hello, Diabetes geographies and strong, accelerating thank revenue single-digit for The and Cardiovascular, us underlying Neuroscience good was we growth high quarter business and fundamentals delivered growing our QX you and executed growth. of joining growth. another to all as our mid-single-digit are businesses Surgical, broad-based

new several with businesses. and continue to Our look product we growth. growth many recent give year. driving ability Those approvals, regulatory launches, back launches ahead of us our are confidence well to dependable half in performing the across fiscal delivering our And combined

And at path markets the that loop we're next to forging areas and time, execute the allocating needed robotics, as on quality will AI value actions our over drive supply transformation, long-term tech growth decade. fueling chain. in executing durable our to med closed our the the systems operations, capital our We're we're like comprehensive into for growth shareholders. and we create same fast-growth on global technologies including And innovative decisively and enhancing

now So let's the get QX into behind our details results.

businesses, of in growth synergistic businesses established continue businesses portfolio X to our categories: businesses. and at look leader We highest market

of under We & grew established performances Surgical market strong the made up X% across organic our Management. this Spinal leaders. just Cardiac very half Rhythm at had again and revenue Combined, they Technologies, quarter. first and Looking Cranial

footprint way X%. QX, and with in driving XX,XXX consistent Xx competitive leading global our is we're of systems, landscape nearest of the above-market growth. Spinal Spine, with we competitor. grew & Cranial our the AiBLE greater we're Starting over Technologies, Digitization the is In adoption transforming AiBLE. continued than over With ecosystem

with are first spine with planning surgical intelligence. only unit-adaptive solution integrated AI-based and We the

remain when system North that Spine Angeles just with imaging the Los Robotic it is received feature Mazor clear in O-arm grew last space StealthStation at unveiled leader month. both bone intraoperative our in and the Our navigation in we the American of first quarter. cutting, Society which only And and Conference we the to and the digits well technologies, double was offer a

in expect adopt extend our and maintain expand we our to teams leadership gains future AiBLE, surgeons invest to share in we As sales our continue and and innovation, Spine.

our on here. strong and across growth Dextile grew single-digit strong with In grew surgical next-generation Now Management moving Cardiac franchise franchise. system Wound VRX pacing, launch our also sales We're leadless We mid-single pacemaker grew by and Stapling X% an in There electrosurgery X% grew Rhythm the smoke broad-based dual traditional XX%, U.S. evacuation Mesh high and our growth both grew Valleylab Micra Diagnostics ProGrip pacing. AVX single digits. in Cardiovascular systems. chamber of alternative of and our was and seeing Cardiac in Hernia devices. Pacing. strength both pacing, Advanced to Surgical. our digits double to conduction Micra driven or and

Our AURORA for lead this novel changer pacing approval space. a late FDA the ICD EV-ICD single-chamber received And XXXX our the quarter, system, lead, for game grew of only again strong approved quarter. for double we this form the in digits

technology. up ramping our training we're of implanting cardiologists on Now the AURORA

the implant longevity the these features, benefits So leads similar size, AURORA only realized heart traditional with and be And veins. or can device including but benefits delivers ICD without one a pacing the one in procedure. of and

home big. just here I drive device, the a competitor's difference And there's point mean this versus on big to size,

an of to comparison. next just with AURORA patient competitor's right it X-ray for EV-ICD an the Here's

clinical the than all the our and to to to that So reps see difference explain in you lighter smaller can giving meaningfully the And of that our addition benefits of we're here's model customers. competitors. the course EV-ICD, it's

is. can how actually out pop AURORA And the to show device. actually we this smaller is size competitor's Now it of the the much

dolls. the get just -- and we like up we guy here, pop it's start guys. those go Except to a small with So right big we then nesting to

this pop out. me let So

AURORA, inside much see of here device the smaller, actually a you had our replicate the here's we to the lighter. And to to put of exactly inside wait, get of weight So weights competitor's. speaking bigger series of much model,

So we're really excited about this patients. as a we've option got for better meaningfully

billion-plus Our this the advantages population a existing competitor's the saving. to displace beyond become only can We but will not the will expand $X device think far segment. grow

X% Turning durability the data we Charing AAA Cross Endurant had at Combined, XX-year to momentum strong in grew digits Aortic following our earlier the presented mid-single year. Symposium real-world our and businesses. standout performances. they synergistic grew in on this QX several franchise

grew stent. the Our Coronary driven in X% Surgery our business of Oxygenator. Frontier in share Nautilus drug-eluting international as strength by ECMO markets perfusion rollout X%, the cannula grew Onyx Cardiac and as we as on gained well continued

of prevention real-time a into grew role continued by Genius. of during uses GI a adoption colonoscopy, standard integrating power existing XX% in a reduction an which business mispolyps colonoscopy, Genius XX% Endoscopy driven the a in colon Genius intelligence cancer. GI important Our the Doc's versus plays seamlessly polyps artificial workflow. in GI of GI detect in to results

markets. strong growth. growth highest market our Ablation X% Cardiac procedure in businesses to Solutions Turning grew on

expect coming years, business over a we be Now growth meaningful very to driver Medtronic. this the for

the pulse ablation and focal in bringing catheters are both We market in the field to single-shot segments. way leading

manufacturing both Sphere mapping, to limited of the in our catheter Affera with release we'll catheter, prepare Sphere seamlessly XX-month Sphere follow-up PFA, the differentiated perform integrates to X from it and same and expect X system. for In ramp mapping focal continue the high-density and U.S., for we submission. coming in and and pivotal RF X in the the market trial all ablation we in Europe. remain complete can FDA PFA drives weeks, the In then

available and single-shot we be for In early our will catheter, PulseSelect CE next received year. Mark PFA, it calendar commercially just

with the a U.S. catheters FDA now be we to first for both PulseSelect And submission, with PFA. one and We single-shot of are market. and companies focal in expect PFA the U.S., catheter the approved in company our reviewing the the is only

PFA strong our ablation growth the the Now Cryo fast-growing leading Front differentiated space. EP system, and billion $X FlexCath map/nav cross-transseptal our Affera with long-term system, solution we in and drive to with catheters combined Arctic expect

high below the was Now Heart. TAVR continues grow the space in which range. to the double-digit low In digits, turning single, Overall, to market. Structural mid-single grew we QX,

strength we Now FX prior Evolut the U.S., in indication. In of Evolut comping continued the customers and Yet the Evolut year of the and we at difficult we declined And mid-XXs stock. initially we win of share CE quarter. sequentially, slightly product. Europe, grew FX digits high the to single expanded in Mark our the of and comparisons FX evidence ESRD launched for grew received X% adoption Japan, purchased and we grew in for when continued on end

in to landmark low-risk extend has Our published Evolut The month, to in now surgery to procedure. XX or trial randomized compared our randomized platform valve JACC. trials best-in-class trial shown that presented to patients last was superior Evolut after TCT Evolut and And initial years at X performance surgery.

And the death can line, disabling chart, resulted and to in As disabling in difference to Evolut stroke years. compared in difference which a X this outcomes reduction continues diverge to years see X% lower X going surgery. This years. valve at and X.X% from at blue with rate stroke or better difference shown no a to other has years year, you or transcatheter valve growing and at a each X.X% at had of X Evolut, X a the is death XX% performance

this to and us competitively. design to Valve Physicians it's compelling data. differentiates understand compelling patients. and this This matters, is them

this TAVR the market. expect look to above So the Evolut we with as ahead, global drive data, coupled rollout FX our of of combination growth we

where digits grew sales to volume-based market In we in China when high is procurement. coils single the exclude you subject Neurovascular,

treating and Pipeline diverters. very diversion, strong available in globally. flow We was driven our brain growth see Pipeline being flow by continue Shield Vantage innovative This for the XXs which is to low on is up Flex Technology both aneurysms, which

our for we base differentiated Hugo Expand to the on announce and U.S., U.S. Robotic of FDA Technologies, is the have trial our And In that we're system. increased start Hernia approval Robotic Surgical launch to we pivotal we enroll continue pivotal installed trial URO as our Hugo. our indication In happy continues international to plan.

it live to seamlessly. and securely appreciating case both laparoscopic including AI-powered are and system, features paradigm This surgeons for currently surgery, We've available Hugo streaming upcoming Surgery improvement. and Surgery that ecosystem, stream countries with live Touch of launch core we're we're deployed excited video is of new creates Touch already technology. solution performance in and digital the a connected continually to procedures enable and of and developing Enterprise review positive digital our XX about robotic Adoption for sharing over the

equipped be expect to advanced driver the years us for We with digital meaningful Hugo, in capabilities, ahead. growth a

We our and surgeon the believe partnerships, surgery with invasive along design, with the our instrumentation, in of will data-enabled program and connected preference and around penetration ecosystem modular our surgery leading insights, open and low advance world-class digital training surgical robotic world. meaningfully our minimally position console

expanding realizing correction boluses offer or every management. meal their world And our that customer and around and burden in the in resulting are in from XXXG diabetes as comes the and achieving importantly, system. XXXG targets system Diabetes, is targets, is X relief combination sequentially feature their minutes, detection is purchase glycemic the glucose as make only AID flexible MiniMed exceeding low users as range. base high technology. XXX to This reduction Users time the

launch growth robust Diabetes driven by XX FY exclude In we grew In mid-teens of our revenue in full recurring the sales adopted when the comp customers technology. quarters or international highest X and or goals. the you see X%, of the 'XX. CGM markets, and U.S., years QX in meeting was in from our AID growth quarter our launch exceeding continue XXXG to that its QX, we're business And have COVID this to consumable our first

above about users XXXG attachment of XX% Medtronic also Our are the quarter, prior since has see differentiated we learn to increased XXXG. as U.S. rates high with launch. with pump the continue unique sequentially. many over And last number in to outcomes The XXXG installed over prescribers rates our meaningfully sales returning very XX% increased getting to base, they CGM

year. in as significant these U.S. and of and our return and confidence of driving that indicators see this we fiscal to ahead, the we'll We've us CGM growth a in back in more year-over-year look sales to ramp even leading All for meaningful the been half this Diabetes growth expect we consumable us. drive give turnaround,

through intensive either to insulin smart to the the or systems of dosing MDI. AID management majority move We expect space smart

including we're people company complete patch of pumps, only of living well advantage a differentiated positioned pumps, for take ecosystem algorithms. durable investing as with in diabetes, And and sensors technology trend the to pens, this we're smart next-generation

let's deeper our performance fiscal to with our financial 'XX So in look go Karen? that, raise. Karen guidance a at for QX

Karen Parkhill

Geoff. Thanks,

Looking at our quarter. good another financials. Overall, it was

of X% from $X.XX $X.XX ahead profit $X.XX, $X.XX above the of range $X.XX Our approximately coming revenue with below better And expectations. our EPS grew and margin operating adjusted the guidance revenue, from stronger-than-expected gross about line. midpoint was

As you Geoff operating X quarters for topline. allocation, mentioned, model, growth. seeing remain company sustainable durable a made, to we've in play including And the focused delivering we've on the the on we row positioned mid-single-digit Based our out capital deliver incentives that growth on and are now. changes

growth. revenue quarter second our at Looking

durability. which diversification coming see long-term can You driving is important to the through,

Diabetes, many grew and Pelvic And businesses cardiovascular mid-single accelerated portfolios well single as by also strong with on many was driven broad-based across Western Europe high through cardiovascular and strength a basis. digits Geoff stated, businesses, X Health. geographic neurovascular. and Neurovascular results our in and mid-single growth. single-digit surgical high as grew digits came also The As Diabetes Japan to grew growth digits,

that X% the XXs growth in teens and grew fiscal growth Southeast until delayed the Latin when East XX% high South mid-teens given in Russia, in Middle single as and of later America. the in Asia, year. digits sanctions. some low had was the high or expected excluding grew markets low Emerging in Asia growth China double-digit VBP We we Africa, growth

in points. constant While implement increased remainder entirely by currency. it X/X efficiencies and inflation. our this declined XX the margin, op to due the was ahead both of about margins basis, basis partially profits in by from our the expectations lower and change rates quarter, point to margin with was driven year-over-year were benefit mainly tax and And gross a jurisdictional operating SG&A. expense this operating a by our rate the we executing benefited in well was due XX investments, adjusted margin We're a line, compensation. the gross mix as improvement decline you structure, currency interest in On global our adjusted can as from see basis of higher Below was higher-than-expected driven and of currency to on offset stock-based

capital allocation. Turning to

long-term shareholders, the record innovation fuel fastest returning We to continue dividend. to prioritize to tech, disproportionately investments We're investing through a growing in we in of growth in med of our and markets some sustain strong our our have primarily and growth. and track long-standing capital

And find retiring expect to shareholders would return M&A, additional our we to don't high-growth, the shares. by we tuck-in extent capital high-return, that to

Now turning to guidance. our

line. our outperformance second full on Given today top strength our and quarter fundamentals, in guidance our both year the underlying we're raising bottom the and continued

prior We from expect fiscal the 'XX X.X%. increase X.XX%, organic revenue an growth of

And foreign currency unfavorable on of while is an fluid, have including million to million, impact third to X.X%. on quarter. the range $X organic rates, the X% to the $XX currency impact to in For million impact unfavorable the would recent revenue in we're based quarter, full $XXX year be revenue expecting of of third $XXX growth an of

number a comp our quarter fourth quarter On we're of the continue expect to of acceleration launches in ramping this into a half basis, product second represents quarter, as adjusted and back the from trend the the we guidance year. third recent

Stim CGM the we're In return the XXXG In and rollout inceptive of RC we closed-loop and there's in the ecosystem Genius. half and device. growth consumable awaiting to Spine, GI we're the And continued the AiBLE inceptive Percept the year sales. projecting of Medical-Surgical, our continued for on in Europe. our Pain In approval our adoption the FDA and Diabetes, Hugo have robot to second both in device Neuroscience, U.S. surgical of associated DBS

we and durability are ramping us PFA Europe, the all continued In the in in the This rollout U.S. gives growth. of and the EV-ICD our our and U.S. Europe, TAVR confidence Cardiovascular, we're Ardian topline our sales launches starting in starting now in of

Moving down P&L. the

and That of to China the reflect half to expected and continue volume-based later tenders were impact year the of first this chain said, base, our and and in to margins we've the expense to take advantage shifted year. got operations efficiencies in we're currency Our on that the procurement in centralized our inflation global in focused continuing scale. our drive supply some have of

a stabilizing top priority. As our you know, remains there improving then and from margins

'XX range prior to our non-GAAP to guidance we're increase bottom to On line, the $X.XX from a EPS raising $X.XX, $X.XX. fiscal of new diluted of range an the $X.XX

pennies tax our more the we pleased to second and a in have we be half, FX momentum expect unfavorable pipeline are and few here. with we demonstrated While the from

of EPS, quarter, X% based rates, $X.XX. an quarter. impact we're on For the unfavorable third EPS currency, unfavorable in impact including seeing foreign on expect of $X.XX recent the we X% on to And third year an full

Before back want Geoff, sending mission. world deliver work of my our to I to employees around our to XX,XXX gratitude to the Thanksgiving, extend spirit day in the who come to on every it

in Back You this pain, health second, far all extending makes roles play alleviating world Geoff. restoring life which important every X you, and patients to place. better a for

Geoffrey Martha

you, Thank Karen. Okay.

ours I outsized has drugs over med past GLP-Xs on certainly mind an months. of your the the promise impact have Now X tech had these know as on stocks, been including

So on share on to with markets. view it impact I thought helpful would you potential their our be our

potential from market. growth presented don't we see analysis believe of of bariatric term. the these and be modest market, at drugs drugs data surgery on outside long for even takeaway Now a suggests said, GLP-Xs the the impact is Medtronic's AHA patients, impacting temporary, outlook, will that we key are the large for class our That clearly an SELECT exciting a which

our we've and Like on reductions you, expectation of potential science-based seen epidemiology, based on based extensive based with many in what historically modeled on This rates SELECT. and impact adherence drugs work. relative the on risk other and is based uptake we've seen

the obesity. SELECT surgery showed impacts bariatric will results standard given that gold for remain on addressing patients, more obese believe So smaller we the the

side also patients on to do surgery. know stay a likely affordability, We the which for that than not drugs that opportunities year, or of more new patients durability, consider them due for many to try creates these effects

quarters the and stabilize reasons, these next several U.S. surgical And we return business. diversified and this by modest will XXXX. growth over is believe For broader headwinds bariatric manageable within our to the calendar current on year procedures

Now are X our installed XX% in with are with so Diabetes, any expect patients. using insulin-dependent We growth in our customers X business of type do aggressive pump rates penetration assumptions, X that change growth Diabetes our meaningful type GLP-X don't see going But XXXX. forward. modeling primarily low type only outlook type in X our we through base even

our Now in and detail SELECT this for on happy view potential discuss we'd tech. med including in the be implications to Q&A, trial more its

Now the like before go close progress. on our thoughts brief we I'd concluding with to a to analyst few questions,

in whether half we You're of a in revenue that results our growth, year. back challenges of Diabetes, that's established that growth our in supply fiscal which expect track have the to mitigated, have the the continue record largely back delivering chain. the of been mid-single-digit durable And seeing our we've held issues many China or

There's of number with marketplace, in that EV-ICD, X indication some growth last and weeks happened that big but half have data like recently, the not approvals our advantage expansions. compelling things, come. gives really in product TAVR an in back to approvals just geographic in been drive product such years new us particular, things only We for a the that our have the

us. is This with And worldwide market up multibillion-dollar X approval. with billion last opportunity hypertension, opens an for Friday, over opportunity And massive. a the we people got already

target fact, over market revenue. $X X% In of just penetration represents billion of the

model, globe. we're on we growth opportunities are win. time, impacts and And on operations to to margins. speed our based deliver extensive to more new the areas growth. allocation playing large execution, transformation currency of the our now a on in to taking an implementing scale capital So And core run increased improve the and that our we've positioning having of advantage are leadership, at and our businesses technology we're focused our counter to durability in executing operating action with the take our supply brought We've to changed we're go extensive the to topline. implementing been culture customers and same chain, inflation to how of And around market and highest company the efficiently

as You're that formula focus shareholders winning we for the we've already seeing revenue laser-focused is creating our that and happen. power. established is durable on for go results from into This value this durable translating making earnings' a growth And forward, we are on today.

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

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

that, If team can you you for please Investor have and question? the Ryan to a asking you questions, can the after out reach Relations Brad, instructions With additional call. the give

Brad Welnick

analysts question, like and button to For Hand. would ask that the the a click please Raise sell-side select Participants

press the select the If using app, mobile Hand. Raise More button you're and

When Your your mute. receive upon, unmute line, you before currently to will asking on your a must you lines which are request to question. respond called

this Lastly, Q&A that please be session is being advised recorded.

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

Robert Marcus

ask I'll both of Maybe upfront. them

the implied the a first the It's half at The of or are year. mitigated. second of I first, half. guidance in the below point of you about Geoff, talked growth most the headwinds largely how look so

talk in first second maybe growth the about should half for that? the how about versus think lower just So we half and the reasons the

to of pretty long-range the XXXX the and plus plan top to year close plus that bottom. X% look the Street to or the right I if on Is X% has next b, part way you then fiscal think on And about year? your 'XX,

Are be like dilution to here or monitoring we there we year-end. numbers any and Street potential headwinds business? correct get try head as Just should thinking want the about tailwinds into from

Geoffrey Martha

I'll over and thanks to the Well, off let questions, -- me then kick I'll off for Karen. it Sure. kick and it it hand Robbie.

the of what headwinds I'd relative mitigated, procedural stable, growth staffing Still are, last being China China are VBP, is the normal I little back think, more with to I or terms behind the stable. think, that's less years behind but under the hurting markets working bit can We to say seen the In control. and issues through but pretty largely We're largely over growth Pricing a especially us. has of talk were we've couple that been later. us. the procedures, go, what more to

So -- was changes a seeing better. us perform And global and and to big our has -- internal our chain, operations we're much that the teams own a one and for our big then supply been one.

a better a into that long-term for us, turning And our is much we're strategic a in strength. said, I situation. strength supply like And

that's and call coming with to is lot meaningful approvals -- we'll having approvals plus into and I'm our the sure, the in pipeline prior launch, here a we're So starting that they're in, get uptake. and of then, new of course,

So where optimism the there's is.

FY then 'XX, to half half about of first turn into the versus over think to In terms how Karen. getting and I'll that the back

Karen Parkhill

Geoff Yes. Robbie. and Thanks,

got the Ardian half growth second returning now and that that's pipeline, talked actually you as first the on acceleration and business a But our in got the PFA, We've Evolut just innovation little know. back the about driving the our growth pipeline to FX Diabetes extensive strong talked about, a half. second really comps from half, do we've approval. EV-ICD, We So we our tougher, half. Robbie, get to Hugo,

we're to of so growth year. that, this confident back next And and going that's we're confident beyond in the acceleration continue half

early. think know about 'XX, it's FY still we you When

specifics. We know rest fiscal to ready not this so year because some delivering and on perspective working that We're what on happy in do our delivering revenue and laser-focused of we're we're I revenue focused the for we've models about. give been that year. quarters your of growth. quarters that also year are today thinking we all at calendar planning process consistently do with of have us I'll you've on And for left our you so competitors, beginning X X give But this we're you And to what know start mid-single-digit now. seen based on the

fiscal Our the full year the X.XX%. markets world big strength And launching product got as are I year we've for those to guide margins new is and around this of P&L, obviously, that half in year mentioned, takes. puts numerous help next drive continue On down are beyond. our growth. And will we're confident strength there into and the that some back approvals and

is higher stabilizing We've And inflation again, a Currency stabilizing. dynamic. But still know, dollar got as bit but historical. it's than it's you the U.S. has strong. been

from headwind FX, out. how see we're shakes facing we'll that a likely So but

offsets as But global progress made starting We've on and on centralizing that headwind. our goods talked a of always, be we're likely can. driving it. with will sold everywhere focused Geoff we reform tax about team. cost out, Global cost ops

working and been our which our teams that pricing focus includes maintaining of it pricing drive our muscle those continue on and built hard as expense, but strong. controlling lever. drive important new to keep place a do, now to We've on our to is and that programs work an We've discipline have in have is largest to work, headcount. expenses, we'll on We tangible driver

P&L, of durable, and mid-single-digit some So top I'll changed, commitment hasn't on long-range color our I But driving our growth, that is leverage you that progress takes. gives double-digit to summarize, shareholder just remind what the a hope combined, cash driving though, ultimately of free and driving down that's puts all toward you total return. delivers which, strong What conversion the a has and a dividend, growing changed, commitment.

the have we've already management, headwinds over mid-single-digit obviously, gives bottom help us the establish whether levers us down, we programs topline. pipeline line. and in on headcount about and, seen durability. to that discipline, in about strong You've place, that they're the in all at same confidence talked And offset talked time, cost We've its durability it's us the COGS, pricing

Brad Welnick

The at Travis next Bank America. from question of Steed comes

Travis Steed

quarter. good just heard those all the I the up 'XX. P&L on FY leverage on to the sum Congrats down comments Karen, comment.

based today, know what EPS ability of be sounds to some there's It still surprise, revenue like good there's growth. major growth a than on enough drive faster kind unless we offsets them for to

kind And mention that's want cardio follow didn't color if and maybe on trial. a the SELECT then Curious fair prepared up the to Just the wanted thoughts Geoff, to SELECT remarks. you prevention did make on you'd that post trial sure in comment. add your I there's and GLP-Xs diabetes of any on endpoints the -- and

Karen Parkhill

But Yes, the next focused obviously, for and is And bottom Travis, we're leverage, it's line you your stage, process, I our P&L thanks about. than at we faster still it's this talked guide. on beginning your the that question. drive of we're down you Clearly, that leverage are ready the We're as driving at to to when planning -- FY more give going beyond, and early. topline. year on 'XX

Geoffrey Martha

see done we see in from a mental impact of outlook a growth benefiting want the a It's talked I'm perspective, it the bariatric sure an Travis, GLP-Xs, exciting first just don't long temporary we work. outside these drugs large perspective. clear even like amazing. with class make that health impacting all, many on we've it's opportunity. I good drugs drugs said, from you to of surgery just -- these I that pretty a term, from of That On that being to are hear so weight lot patients term. you. of our from near And to market, And

of of And we I then our it's digits, think we even. And in see stabilized has back year and bariatric there. -- mentioned, on coming single that as coming a small the low rate piece, that here part the decline the revenue,

So and we it I to here more that. a kind picture out I'd question call in Officer, SELECT Mauri, talk Dr. little was, relief on of do her like have here bit And seeing of lot at really and to of Chief here Laura in a bringing thought work of SELECT. we what did going epidemiology Medical we're I maybe science-based a do the said, that and our kind about on digging a here and I'm call -- looking and

can you here? in chime So Laura,

Laura Mauri

of SELECT at Sure. as look beyond obese us overall procedure topline back Thanks, will about this that is points patients lot a adherence, the advance at said, heard population, the trial results. that there a And a change results you of the trial we growth were results volumes. didn't the the the in look more to Geoff. with but very details at cardiovascular understand know, the drug end presented August these gave Travis, for AHA were Yes, And and this history really be patient important Geoff effect our impression a disease. cardiovascular as negligible the that on of detail

saw And detailed in things that's a of the that couple we results. based on

to for would might lack other a we setting were looking First, the means at have needed present, if higher of -- higher that, of things we it cardiovascular that is have number it had something treatment not on treat and are that had spur wide that it's important saw adoption that's if spurred positive. guidelines. bar there been been much compared then death, was was that used the in that adoption. a And will with the and been effect that coverage we And more because lack and

MI, death, are nausea and lower, you in findings discontinuation trial. the patients interesting are as lower know there was results GI know, as in the rates stroke in of mentioned. and only due couple clearly, And treatment effect rates And practice the And I even composite the nearly effects. And on side from of adherence that effects. then were that we of a then or endpoint nonfatal not to X/X the cardiovascular

seem and as we'll significant the no was have the want didn't there forward. population in effect I going benefit much BMI As earlier, Geoff is to mentioned that subgroup, better certainly treatment understand American think something to higher North which

range for and up including available part procedure we the U.S. areas, populations the with updated using freely to guidelines the prevalence are across different obesity data on know, of you cardiovascular well models assumptions each at XX of and penetration over all a and range a and seen way and We're tolerated So statins, which, adherence what just looking the really then procedure these our the of of past of major across using for procedure inputs and as assumptions, procedures time volume years. to that. we've

input on based trial growth procedure obviously TAM to And literature really of loss also the effects. XX the weight seen we negligible to to cardiovascular reduction the next for XX SELECT outlook. is years on risk And the is that the a each in then endpoints treatment over or at look bottom reduction the the line

or and really what areas. markets growth offsets because those like or in underpenetrated that note the this to rapid the growth will doesn't I analysis really think PFA probably it's important are include, in there new that's the of -- be also Ardian

and greater potential then patients that patients procedure And potentially for cardiovascular the BMI because upside a for longer or funnel of lower growth survival procedures. eligible fact, in there makes is, of

AXc. know question pass was there the Geoff. well as on So I'll about back to it a hemoglobin I effect

Geoffrey Martha

while that comments we're any to on relative Well, on the GLP-Xs? I on mean, thank And Diabetes one. you, Laura. topic, maybe Que,

Que Dallara

as non-insulin prediabetic of will that mean like very well XXX a X million funnel fact X Yes. as slowdown insulin, prediabetic growth And in mentioned look as maybe more be there the the doesn't basal offset majority type there's and some using and the business, we over as penetration with to X. when be well dependency. of market million towards view come type X the you studying Geoff the Xs size insulin change XX number X population, our million than beginning, AID as of this spent time And may fact that I up but type there this. we of the mentioned, think small evidence believe a low from a type quite more I say, we that by would is to of the in bit population -- some Laura SELECT -- point rates. on the who in the is at it insulin our million at long-term the And of XX%, require than

remain about in optimistic pretty so And Diabetes. and market the growth profile we

Geoffrey Martha

analysis that you Laura see of that's tech med a tip strongly And Que the that Que. type afib, woefully All of. besides these just medium on, and mean, the beyond from we I mean, fact Medtronic's hypertension, we right. why fact these long get can see, Travis don't I underpenetrated growth drugs gave I iceberg the we've perspective, areas questions obesity, mean, term. you intensive, or X the and we're all others, the are -- impacting done Thanks, that the just -- as we so that feel

question So and I your answers some. hope then that

Brad Welnick

We'll Biegelsen Fargo next from take Securities. question Larry the at Wells

Larry Biegelsen

for the Just Sean, XX-month for about you X see product questions the trial, relative the can on completing And reimbursement pathway you Sean. endpoint want for pivotal factor and One positioned talk Brett, talked form congratulations. me. On about ITNS the the data? slides sacral about ramp? Ardian, the does primary FDA the X-month neuromodulation? talk how to here ITNS Could being X TITAN and you ASP,

Geoffrey Martha

just I Larry, the say, has really, mean, at leaders thanks excited a we have Geoff. long want -- hear I this in space from do On to to Good this approval. it for Sean, been just Well, and and it's -- has involved before been been I over about cardiovascular turn team the Ardian, here journey, are look, the to really and -- I past. congratulate question. you, Medtronic -- on the

lot a and real-world and here initial millimeters and these XX pressure this assessments. drops primary mean X in more the additional in absolute setting X case to of of of months X blood mercury drops We in actually our a have over data RCTs. We primary time at endpoints from consistently the office saw

So this game is a changer.

as number patients there the them story. the involved exciting. palpable. are in as a of of compelling the years, trials, mean, and company on And is It's it's our talk for it this is in a weeks. and this we're we how you in out as to is I doesn't changed a that have, even look, their talk and and data excitement much actually here to entire And have patients, And having life. tell we been come whole talking to couple very patient the physicians

and And big patients opportunity a us, a so big opportunity too. for real for

asked that about to Sean. of specifics, into asking you're but with you over Brett some about -- And reimbursement, don't I to turn about why we I'll to start and the can tibial the getting believe go -- we opportunity And Sean. so then talk

Sean Salmon

the question. Larry, thanks for

national all player reimbursement and Medicare XX-XX between with and And see know, We payers the the and you ramp and working is along. input in to payer. by highly gated in local into determinations we've an ones be state decisions from roughly been both and important payer going private As to approval or Medicare, that payer private contact certainly. state pursuing be happen course, of been, regulatory split been parallel the we've payers, the commercial insurance. those the We've will private by that's by with largest coverage that

And like years X our And new interest long-term the of this willing the response is and atypical us for to from to to so far them have out what's understand therapy. patients data. open is to particularly therapy data, a thousands the engage been which very of with have

So that's encouraging.

given setting the national for is will transitional approval more Spyral like a device avail breakthrough there in Medicare the have alternative we most a and that over these to temporary work X- coverage us. X-year ourselves Symplicity that reimbursement pass-through been pathways Medicare important both payments, the for inpatient the designation, to or system in is the And as those for are with determination. for well that pathways that And add-on setting as or NTAP, outpatient course, period payments, for population payment to establish by TPP. add-on Of technology question, we as your permanent new established

very ICD, the TAVR, therapies, of and commentary we way We've has successfully to you as Micra, CRT well we'll Biden the ruling along is what course, this there that positive therapies, the been ourselves know, not programs the CMS over to. well. development considering On And way. many, both other yet. with that evidence we've along very, avail transitional out. the ourselves pathway, devices look to emerging coverage as including refinements that stakeholders avail coverage seen other those And had finalized or is CMS coming TSAT in as with we've to largely We that as time. established as many used administration suggesting to also and we're to going for front, been forward line It's

hard so assured, really critical we're reception getting we're far. rest ramp this working reimbursement. into of on It's technology, So and for the

Geoffrey Martha

Brett, Sean. Thanks, answer part want do Okay. here? X to you

Brett Wall

good Yes, will we for Thanks your those the patients with X hear follow-up The for design, follow X-month XX and months. voice. study absolutely, a Larry, study TITAN to was actual the question.

they additional million people data as patient in well. the it This United we'll following and for place now really discontinued about form at of fits This There's the patients all-adult additional X continence their seeking therapy have procedure. centimeters, significant over gum population. drugs, same drug products ankle, and half opens as in of continence X The roughly stick So States are opposed that receiving therapy. is or dual to everyone. a and those a failed have a devices XX-minute up about the be size X.X is factor cubic

now. modular this is not be ongoing reimbursement seeking we'll exciting opens submitting seeking substantial reimbursement that in growth. population data new help contribute here a up established a technology Category We're and therapy We shortly. product a And up the profile. and opens further now technology submission. utilizing its that this an field or right will We'll be and have to X to the develop particular This that is

Geoffrey Martha

And Yes. one analysts Thanks, please, follow-up to Brett, the reminder to and related stick Brad. if question question take the one and a to We'll thanks, Larry. needed. next

Brad Welnick

The next ISI. Vijay Kumar from question Evercore at comes

Vijay Kumar

product-related X had I questions here.

is past you're I'm at plus? all approval, right? thinking incremental of Ardian PFA opportunities. product right, approvals between drivers mid-single about had your mid-singles. the these a months now you in one, coming growth X First doing curious level, just and that pretty high new in, just You're how With already EV-ICD, this a product meaningful few

Geoffrey Martha

we nature we a make over have for thanks make saw these that this the out hard through fundamentals. market couple in last or large our as this high of internal are seen commentary, am the to men And as And and sure growing approvals. commitment in. of working be products are changing Well, growth these our for And markets robust Vijay, you and confidence boogie pointing markets the just conditions we it differentiated the question, thanks internal which in the we've gets to and believe, so I and disappear things, whether -- to unquestionably durable. really, years,

which -- the is about these me sleep talking number, that this is we're in This well. Because these of so first revenue -- the it will high-growth there. in believe, from approvals breadth for help markets, that important. time you I durability Everything gives flows

So different like just make talking we at reliable this of we good. sure in growers we that good then And that. there types can I to and plus, and things and about want flow P&L the on before are less point, mid-single-digit environments, start very about from durable leverage

-- on general. overview on X my that's So in the pipeline those

Vijay Kumar

product related my on for maybe perhaps here, here. robotics And Mike question

In Europe. approval? trial, Any up for this on size FDA on on installed might in when any You But went base that plan. sense what clinical it's you an end, said sense perhaps this mentioned is? base timing installed U.S. trial of the

Mike Marinaro

the So question, thanks for Vijay.

We're installed First, numbers but not base. the will with of installs, forward -- our we basis. installations at increasing we quarter-on-quarter time are have we continue added to this quoting continuing a are on

will see really up availability as of the Our into procedure U.S. we of basis acceleration program. system volume through instruments work is our a picking on to quarter-on-quarter then our getting the and start

the the is in Expand commented excited program. speaking track, our and you there, and URO we're product very enthusiastic with Geoff about noted just they're and on the investigators study and that

going of U.S. according give but to time approval proceeding you will continues not lines that, I it's so tell And forward. to for We're plan. that

Hugo today. anticipated And than in which step in we're where in take States general here Hernia the general active then start engage and as IDE us approval, excited are about quickly very surgery to the allows a segment United noted, had a the very the to more we surgeons Geoff with big we to

a sales and the in hunger and in Hernia hernia area Of Repair. a capacity course, channel There's States. United in a for the large real we of have business there growing volume

we pick into allow the the to And market. really us parallel running IDEs entry in up momentum as will so to now these contemplate start U.S.

I'm very are this about for Hernia giving surgeon approval with not general but excited yet, in plan. we the also specific So and dates to on IDE surgery approval. opportunity move with into general the

Geoffrey Martha

Mike. there's strong new And that one experience Thanks, primarily that look, feel interest building physician we robot now I have mean, in we're And and comments. as so in mentioned, a the in out that capabilities that. And of has instruments had here. in the we will be know our have I up U.S. Europe this. really then and a out robot the the that U.S., portfolio lot can some and instrument was we operating will strongly on I building acceptance. drive Mike's and to growth the of and a emphasize the Step just launch executing U.S. wild of -- Mike between lot that really, that trial

So Vijay. anyway, for more that. to thanks come on question, But the

Brad Welnick

question from next CL with The comes Stewart King. Kristen

Kristen Stewart

if I respiratory any spin. wondering interventions just was the patient could provide on monitoring you updates

Karen Parkhill

that question. and for Thanks, separation Kristen, Yes. maximize is focus value. of updates. our shareholder to big on continuing through all of the the it We're No to work

Brad Welnick

question at Matt next from comes Sandler. The Piper O'Brien

Matthew O'Brien

-- acquisitions So a $XX-plus you you're specifically. question, Geoff, It's but revenue company billion for just historically. about talked tuck-in you one more

an flow, public deal time pullback forward? doing terms strong M&A the more solidify we've perspective et now from to going more really in the things, Are the operating sheet, company now if given be now, just Is new together, strength these model wondering just just of algorithm aggressive? to some amenable kind of to the a time to you of bigger deals given side do got I'm be growth the aggressive your given size, to able to seen your balance cetera? more be that on in given of the Just product is just bigger

Geoffrey Martha

Yes. Thanks operating you're And for clearly, it's environment. come a the seeing asset question, tough Matt. think I down. prices And yes,

deals. augment I is with mid-cap And our on high-growth in to to we against definitely that programs or PFA, we've that goes got All these still being of Ardian, pointed big below. come think the I on. mean, the the down, we're really as that big lot space tuck-ins. they're a out, organic focus And the going Robot, to tuck-ins. between And Diabetes, There's in continue capabilities, a said, and you up organic have would I on. do going appropriate the bigger just lot list markets pipeline -- focused now of organic particular

I'm on think we're focused not So kind -- of really focused and we're going don't we're that on, any to not going bigger to signal this at I deals point.

Brad Welnick

Newitter comes The next question from Truist. Rich at

Richard Newitter

or on Just bit play a broadly your -- I out. saw competitors number of seasonality weaker, tech quarter med for we third just a of more little think, in

wondering into comment what's kind expected August into of quarter. September pickup? could exit trend would talk it the been kind you could Just if what trends weaker And Was October? Is normal unseasonally the have if XQ, than than stronger you the the you on of especially throughout thought? from about

Geoffrey Martha

that one. answer Karen Sure. Thanks to I'm for the question, to Rich. ask going

Karen Parkhill

been expectations at the When we part say, think our in few second no tracking guidance the I of saw we just the trending, how this well. would been we in our Rich. that's throughout it's trending what and strength Thanks, month you this weeks first the And quarter driven to I We're Yes. quarter, that's offering. at by look strength looked set matter stage. that product of at.

Brad Welnick

comes from from Singh RBC Shagun question Capital. Final

Shagun Singh Chadha

guess, on Just, a I Hugo. follow-up

about competitors thoughts how just out. versus color motion more see if you is November think as robot wondering that on it's your competition? do technology just offering shaping it any your I'm how capabilities. get to wondering had on what an competitive the I and twin Do just design recently then their of One are surgical Or specific was you showcased possible tide? invisible landscape? October your a and rising And

Geoffrey Martha

I'll the and Well, one. the I'll take question. for ask that Mike I'm to ask question -- follow-up going thanks to on Hugo

Mike Marinaro

Shagun. Thanks,

So very And see say program. no expected, there. they were were interested about the relative we our developments here I'll that surprises as their competitor latest from to to

flexibility as excited console, optimistic of differentiation with which program the in discussions our market of the the ability or a what very be terms is with of their see design, and in site highly care, with modular open today. we well have an location We what about differentiated to continue to we there as heard from in

news interest And speaking, like that we continue procedural continue there reasons our the so just of fields to is surgery. to Hugo volumes continued that robotics continues that customers across More differentiated real basis. be see broadly the And differentiation in on in though, good in and increase multiple we're be expanding the a reasons. seeing to penetration quarter-on-quarter

for the news that good it's so field interest as grows. And

So story continues positioned the well which good and to a field we're expand, for is Medtronic.

Geoffrey Martha

role now. we're Yes, about talked would the Enterprise, market. entire navigation, we've AI-based or with and the imaging on Touch it Mike's out digital That's I and -- in robotics. Surgery Hugo, goes first call beyond change but time leading platform to mean, robotics, isn't with into a visualization, here And the just is we dynamics market spine which It that. -- And got presurgical, interoperative AI-driven planning. that, gets it right digital argue we're platform. like broader with I than And we it's what build an of to doing this

And or many spine you're over of that's seeing you're changing competitive And in marketplace in in for what's out seeing our and even seeing patients. impact years, what you're played as important couple dynamics as like it's the physicians the competitors. market spine the the the last

Intuitive of this the we drive in competitive out. big make space surgical people and the dynamics, the you're one NuVasive together, an lot going offer recently about we're do competitors of to we've coming that ability excited takes plays and got this. competitor to the a we'll know experience. lot a about capital happen. by to I been against really But kind demonstrated the believe takes And of And fall and And expertise. wayside. big seeing with here. and a in a confident think It know this there's how And Globus believe here It that. a change And but space, how I are lot we to and I see up we've in is we're a

interest that, progress sticking longer. we'll Thanks I And the our call us earnings QX really think little we continued broadcast, XX. I a close. February continued we on Tuesday, on and to and in the our the to questions And forward updating with you look bring for anticipate which Medtronic. with holding appreciate on support So

like thanks your today. you a wish this enjoy Thanksgiving those U.S., I'd to week joining you. and families and safe. And in the very happy us stay for the for holiday Thank With that, and

Medtronic (MDT) 21 Nov 232024 Q2 Earnings call transcript