SYK - Earnings call transcript Q4 2018

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Operator

Welcome to the Fourth Quarter 2018 Stryker Earnings Call. My name is Josh, and I will be your operator for today’s call. At this time, all participants are in a listen-only mode.

Following the conference, we will conduct a question-and-answer session. [Operator Instructions] This conference call is being recorded for replay purposes.

would conference remind statements. call I discussions that begin, this during will we like you to the Before include forward-looking that recent results in actual could materially Factors discussed are to the with filings differ most the SEC. company’s cause non-GAAP include discussions measures. certain the financial Also, will most GAAP with on report to today’s filed can today in SEC. financial Form be current the Reconciliations release to that Stryker’s measures found the press is directly comparable an exhibit X-K call over to will I turn now the Mr. Executive Chief and Kevin Chairman Lobo, Officer.

sir. You proceed, may

Kevin Lobo

Welcome to call. Stryker’s fourth quarter earnings

Joining VP are Glenn Relations. Katherine me Boehnlein, today Stryker’s of and CFO; Investor Owen, Strategy and

For results opening our with recently call, we to call before details will was followed and an of acquisition by additional KXM. Glenn open stellar the today’s Katherine, Stryker. I’ll XXXX year provide for completed then Q&A. Mako quarterly update a our on provide comments, regarding

we a and comparisons from leveraged Following earnings successful gains. adjusted growth tough impressive XXXX, organic sales delivered

execution Our grew talented from of organic launched drove that new in prior sales products, team by nearly and sales has year broadened and portfolios. QX organic We and X.X% acquisitions growth delivered benefited full are our X%. marketing sales

reflected performance had excellent a across launch products results MedSurg up excellence, to divisions broad-based and commercial ability an Medical as Endoscopy, and regions. steadily three new X% XX% MedSurg organically Instruments, divisions acquisitions. XX%. and strength QX, large successfully and this between Importantly, grow reflect integrate strong

spine detail and over double-digit the We're achieved South delivered and the increasing year On growth Trauma double-digits as registered at grew X% Europe Orthopaedics excellent Extremities, markets for Kathy which by Interventional Trauma market. hips gains led first Physio-Control of U.S. momentum its of double-digit as full international basis, QX and resulting with crossing powered double a launch Geographically, have of growth Neurovascular In the by growth. Medical posted endoscopy high-single combined competitive U.S. our organically organic Pacific, in international Extremities all our first KXM, balanced end products U.S. in was CMS position terrific QX sales up was XXXX, XXXX quarter. emerging grew time than $X increased from Canada in of shortly. was solid in business growth similar Mako and the camera multi-year excited MedSurg in and and digits. emerging again the Spine the X% organically, which a new X% period a within Japan the milestone next-generation organic full the For of about higher example, will growth. grew digits will meaningfully enhances and acquisition and knees Spine XXXX, flow performances major organic Neurotechnology billion and XXXX. growth. in When once strong year markets Europe. while growth will

R&D going leveraging top to QX in and to Meanwhile, line we strong revenue year-over-year in help operating despite deal KXM. points on focus forward. make margin increased we Our the sales our basis our as XX including continue maintain investments significant meaningful dilution ensure was growth forces evident

high-end up Our XX% focused performance at transformation deliver line allowed program, us highly top our range growth which at with EPS combined share, a executing teams $X.XX cost remain for our the to our on year-over-year. of targeted

and to order year. revenue entering tailwinds had for a expected decade. initial exited Of healthy the we is be of to X.X%, of highest growth and the in XXXX, as with to Turning organic X.X% note, XXXX guide book mix a for Stryker last representing capital similar in businesses have our we range sales a growth headwinds

organizations. with to $X.XX notable And year be we results KXM, despite margin XX% team full to that, teams their operating world closing, the the annual growth expansion, us an combined target I stakeholders. the increase adjusted margin In commitment we With EPS I again to will expansion. selling to With our targeting for expected to the support and of are over a to high deliver year to enabling fully now around is sales $X dilution, and to and end impressive relates of once across an of Katherine. XX share, a efforts marketing, off in sales, our points basis our at want While on be thank to to expect turn XX XX%. XXXX, dilutive integration to ongoing year-over-year MedTech XXXX achieve of sizable it of R&D start call will our largely as excitement

Katherine Owen

product My our as bolsters our on experience competitive Kevin. provide KXM $X.X KXM November, align spinal and complementary resonating our provides and we are comments we we have innovative acquisitions years the the roughly with and well an ensure deal force. acquisition significantly Mako teams to billion, quickly highly integration update QX customers in our performance. sales of the The on moving leveraging of our optimizing of KXM focused that today completed is Thanks, a spinal which portfolio for organization. market. Stryker are In with the as to will position

leadership organization. the considerable senior We establishing progress since have made of spine global team combined closing, the including

which the should actively of the end organization remainder by quarter. be are first the completed building We of out the

completed the align to team across announced leadership Importantly, the our organizational along teams expect hybrid with respective sales in selling sales structure sales is force to and territories. QX. leadership globe working with with been model the the this The their be has we

cross-selling cross-selling forma our be combined is quarter. on remain early XXXX. growth its comprised the We additional in portfolio progress deal plan track to made and deliver in stages will Additionally, expect and revenue with the core product our throughout spinal mid-single-digit to model the related pro

available will for will be Eric will Q&A. President Major, be at as precipitating Stryker tour further a update booth our provide We and of in AAOS Spine,

installed globally, over XX% Geographically, robots with way with level the account. a competitive XX have U.S. Total robots Globally, the had system. in versus XXX the strong been led XXX in Turning the Knee to have particularly performance the which Mako, we with the with robots record in a QX XX installed prior now to U.S., upgraded of XX in years. majority we

surgeons over of topping XX% quarter all representing Mako roughly performed the approximately quarter, in XXXX. roughly we Mako total bringing were with trained procedures Total Knee, to full roughly the number certified There performed on the U.S. to procedures the XXX procedures X,XXX. launch during the XX,XXX of Total sequentially During with procedures in approximately Knee year of U.S. XX,XXX increased XX% surgeons robotic in knees the since XX,XXX. Mako

Total as saw of to and underscore the more QX on to in over and is patient that that XX% driven which cementless knees adoption which year-over-year. in being and on rates XXXX further tool We perform uptick by benefit. for marketing climbed continued continued clinical cementless. utilization a results utilization Mako with are to the XX% approved demand now believe undoubtedly also was XX% surgeon is hospital acceleration over the by powerful robot, these also steady a knee by for robot powerful in drive cementless our up robots, the ability data the Combined, we helping QX we the FDA is sequentially Knee The exited XXXX in

robot. Looking drive a with to exited the we ahead Mako the healthy momentum well-positioned year pipeline as to XXXX, we continue for believe orders we to are

saw During that for review cost the Knee patients care, the evidence year we better and delivered XX-day strong which clinical Total peer benefits Mako lower outcomes of pair.

Knee we Mako pass at in as later the We application to presented continue turn build XXXX. you clinical boot anticipate support the We With the data August the launch to on expect on mark later over Glenn. AAOS, update of in to Mako which commercial also our will that, to quarter. Total the further I'll look and clinical this further call full at of two-year to towards data be include now

Glenn Boehnlein

Thanks, my quarter the on comments related financial drivers. Katherine. Today focus results and our I'll fourth

detailed financial press have been today's provided Our results release. in

growth was the quarter. X.X% organic in sales Our

from as foreign the the unfavorable had selling quarter the As on a number quarter this X.X% while year same prior XXXX. X.X% Pricing of currency reminder was in included days sales. unfavorable impact QX an

demonstrate X.X% portfolio. guidance X% performance X.X%. X.X%. impact reflecting XXXX our and of For had across was growth strong regions. full XX.X% for of XXXX the year which growth organically, and the U.S. the sales number momentum to price exceeded year X.X%, balanced as recently U.S. X.X% growth international a raised with our grew organic sales the year. Organic solid sales on continue sales for organic to our was quarter, of same days which was had across International most was organic growth international X.X%, full the

expense year, control. $X.XX Our increased adjusted XX.X% growth sales strong reflecting on operating of prior combined leverage with quarterly the good EPS from

transactional, Our no with impact rates translational fourth either which quarter consistent EPS foreign our had expectations. from was significant exchange or

leverage. EPS Our XX.X%, disciplined full of increased year and $X.XX growth strong reflecting sales

provide segment Now, our some strong we'll performance organic in performances Trauma of highlights X% constant U.S. delivered organic in highlighted Extremities of currency and and X.X%. performance. the was growth X% by growth including around This of Orthopaedics

knees X%, Additionally, business U.S. other U.S. grew X.X% hips grew our orthopedic grew at and XX.X%.

of of management delivered XX.X% exceptional Total X.X%, which and products. its with X%. markets all businesses. have continue organic an had Within businesses. gains with and growth and our U.S. sales in quarter which sales had Endoscopy We Instruments ProCare across growth Canada. our for Internationally, emerging X.X% in of Knee and XX.X%, strong to included the of the see in our the surg we platform growth currency continued strong growth account reflects MedSurg and medicine, performances performances of organic in growth business delivered increase across knee power XD-printed surgical X.X% Mako sports demand Orthopaedics to constant organic organic growth Europe, communications U.S. U.S. waste strong solid businesses

and currency in NeuroTech Neurotechnology lines sales our had our markets. customers reflects performance expected moderated had of QX its performance growth had video during and acquisition double-digit MedSurg had organic XX.X% XX.X%. KXM solid had Internationally, the within strong next-generation Europe, XX.X% Medical organic product our of system. as with stretchered, system driven and our This Sage U.S. emerging which strong quarter. Spine businesses. camera note of and constant the EMS with business of video NOVADAQ Of prepared growth of and bed, As organic the growth growth for XXXX robust organic growth XX.X% growth by X.X%. reflecting of launch performances growth Australia which Endo’s late however

CMF the driven by Our demand Instruments. our business X.X% organic posted of NeuroTech quarter stroke, Powered U.S. for hemorrhagic, growth for Neuro ischemic and our strong

integration. We continue commercial and the of to be progress execution pleased our with Entellus

growth organic spine implant of integration performance our products. KXM offset XX.X%. continued by Internationally, Spine our IVF XXXX. pricing Japan. by pressure moderate of continue our of saw China and strong this progress We and business business Neurotechnology the demand in in and on growth significant had double-digit Our driven in This Tritanium was quarter and Europe, made will

will on Now the fourth highlights I operating quarter. focus in

press our certain the of release impact primarily to adoption in earnings in of XXXX SG&A from the noted quarter first call, had discussed As reclassifying ASC sale. the and XXX expenses

this references of As net points basis impact. are to such, all improvements

XXXX You should our be note required. no for will release press XXX longer that reconciliation the ASC in

Our quarter, points year prior adjusted was business year from XX gross by the impacted prior basis unfavorable quarter. margin and XX.X% price, but foreign favorably of gross offset was exchange by margin acquisitions, Compared mix. to

XX and XX% gross with R&D basis year, X.X% prior was spending year primarily For lower was of the full the than impacted our was mix. and by prior price in points business the of margin quarter. sales adjusted year line which was

full lower X.X% was than For XX prior which the points was basis R&D year. sales of year spending

was basis by XX year to SG&A prior points. of sales, the favorable was adjusted XX.X% Our quarter which

our adjusted project for basis favorable sales, Both operating the was full program the In year, adjusted focused shared is which focus XX of prior operating including the basis growth program year the the key PLCM services. CTG indirect points This continued of planned for and investments CTG project. to on XX reflects points. purchasing year, our on transformation quarter. like the by and improvements quarter the to margin expense other through ERP by which For was and was quarter, was our favorable approximately XX.X% impact of this projects year sales SG&A the continued XX.X% negative summary our offset in prior our acquisitions and cost

prior XX on to from basis year, XX Our full points the up was delivering expansion. margin margin of points commitment operating year XX our basis

and investments Our of and margin the quarter good primarily acquisitions. operational by basis operating approximately an leverage points impact continued reflects XX negative offset for which latter The the year. savings, had and

due expense and interest Next, and quarter highlights I to other prior will primarily provide year income some favorable interest income decreased expense. on from Net rates.

Our was adjusted XX.X% rate. tax tax effective fourth with rate line operating of quarter in our

the effective reflects effective We XX.X% of tax anticipate and was expenses. XX% compensation stock rate from XX% includes stock from in optimization rate compensation which year to an operations full geographical our expenses. XXXX benefit benefits primarily Our tax which of

the on to which paid completion marketable in $X.X and balance XX% Focusing of cash of U.S. strong that of which off billion. $X.XX anticipate balance continue be billion on debt to a position XXXX. maintain to approximately billion will of debt $X.XX billion, was maturities Upon held be sheet, sheet we outside securities, $X.X this, with was QX the we total the of approximately relates Total

to Turning cash flow.

of stronger XXXX. reform provide $X.X tax in increased in XXXX, XXXX. range will especially We in that And operations we sales approximately million acquisition growth by working reflects we profits. on QX, be repurchased billion. on This capital to payments new expect to our the million including a tax as untaxed the anniversaries. market vary and Based $XXX X.X which tax XXXX see result will Our be quarter ramping approximately now specifically and and product by momentum increases of from toll and This capital, organic required assessment higher X.X% to in I X.X% for economic conditions, previously given we year-to-date QX typically of and XXXX current quarters cash guidance. from million the growth will offset related shares. was somewhat earnings U.S. January are $XXX expenditures payments In to anticipate as

be As your QX exchange foreign to QX models day. we one number quarter. full the approximately first of $X.XX you and X.X% levels, selling impacted hold have current the same days note selling for the per near impacted $X.XX in and will to to has $X.XX sales update from negatively please negatively QX, anticipate and XXXX $X.XX that QX while quarterly by EPS share year more If for rates be

We also in consistent of fairly expect X.X%, experienced with environment to is continued X% which unfavorable the pricing price reductions XXXX.

deliver full acquisitions, of continue of of to expansion XX points In year to the XX expect operating on addition, XXXX. our expand to impact Including current to margin we we our margin. basis anticipate negative operating in commitment

expect We will have bigger the activities half acquisition first that a margin on operating impact during negative integration XXXX. of

first be range to approximately call in net adjusted the of earnings $X.XX XXXX, share the full will Finally, open the for to quarter. per for I diluted we expect including to $X.XX And $X the $X.XX up now year, for for Q&A.

Operator

Thank you.

Robbie question-and-answer the from [Operator call Instructions] begin now will session. We Your first with JPMorgan. Marcus comes

proceed. You may

Robbie Marcus

Thanks congrats so great the quarter. much, and on

of for should aware are give drivers business? in puts what you we that at So on with in much and like going the to delivered top XXXX Day, on bit that told November was very you be with a XXXX Can of us look much promise very line you've line and the us little XXXX. guidance year Analyst the that by takes key next

Katherine Owen

at Yeah, product that have is to do the going overall, similar endoscopy into first cycles will very quarter. we end it happen generation some the up I XXXX, with the the next camera, think we no by employing if headwinds you of tailwinds, which launch we're getting look

businesses So very be for capital healthy significant the We order Orthopaedics our that across on will book Mako. them. a including with year finished

launches, the that Trauma expect we for our another our and in so accelerations as a of and in was there's sequentially several will the robots has has the faster the also as launches is AEGG Medical getting there. received, spine launched across really the them and Atlas for continued to as we well that and a that that regulatory the forma And strong board. and book, Neurovascular seeing given driver. So growth the our get that the really Mako We've pro X% product year. into across be still an acceleration expanded instrumentation we’re XD-printed from well the benefiting strong AAOS U.S. products And it's and look in product order then, product this system the will really on past accessories healthy cup new in XXXX. we're help Sage new new been that's revenue a momentum in for in acquisitions. be in respiration quarter the we you launched businesses then as for heels momentum move seeing launch acceleration of the a with XX nailing year had. with and is board fourth at also spine of to acceleration at then challenges Trauma Physio-Control, hips drive out quarter And we're lot a launch including we obviously, late system happening has if they're MedSurg look new related instrument and portfolio of multiple continued to looking of up launching several

one a really again is no line, tech. we end strong will top really med there the is which allowing So the which be number and we singles high for of thing doubles, totality of single the are that of at believe

Robbie Marcus

right, the operating quarter, looks gross Thanks. versus we about Glenn, should can on bit for a the of different you like the margin we we what's that All it impact expansion, P&L, items M&A And underlying question little the financial and as thoughts below are P&L? by And getting strain the about for year? some came thinking give a be margin high-level deals the in the in know don't integrated line then fourth you. us how think great. a of next guide that I couple with but the you

Glenn Boehnlein

Yeah.

margin management you really product programs I is the indirect a we've think we And productivity and spend the in into improved and driven largest place really by before improve but gross programs started tell margin, margin sales our impacted expenses by specifically these mind we services. kick break leverage really don't them be you mix impacted will If have as efficiency. most expenses, to lifecycle really as operating programs that in. and the on Do longer some period shared of really in about two programs. margins factors, categories, these plant well think just Those provide our by the operating we being we have price gross and gross of network to gross would So plus about see benefits savings many savings. I've guide keep around

will negative our to really margin negatively, acquisitions on So sales ramp on the those see the of term especially acquisitions. as seek side we though, M&A we as impact to from continue expenses the off on in operating sort near impacts

So probably we'll would summary, out better over near-term term, line. we say, opportunities savings in drive more longer the see the expenses I but margin operating in term near the of gross at

Operator

with Hopkins call next the Your Bob line from of America. Bank comes of

proceed. may You

Bob Hopkins

Great. participating how think I'm curious much that it – in just capital markets, Or as performance seeing just seems executing it's Thanks. that with some you okay, like markets momentum? this very of and health Good well? executing of year. afternoon. obviously strength the health the this well, the in product mean, markets, question obvious bit across a and of company little exceptional execution of having you're Kevin, flow? growth really an Stryker about are sort guess and is it I quarter is bit start you're good I little of was healthy obviously, well, a I The showing pretty because for to geographies. is, is some talk my an also all if wanted do the Maybe overview. also businesses markets

Kevin Lobo

Bob. Thanks, Yeah.

And thing. last feeling the As again bit XXX years, been little the-year we've outperform points. over next But you've year about markets very in past up the moved each somewhere few over an XXX, that's bullish every-year market very, years. the This exited basis of year. a have the doing seen MedTech six we between same consistently

market the healthy. is outlook say would I So

grew our great capital products. growth minor we the performance is did about really stretchers say fairly U.S. beds book good any markets. There're that good our XXXX is execution something would U.S. we United order saw book without we very the nothing order the double-digit That's and Our of really Look outside major. I at of performance. really good. that a with is that, a products, different actually – and we fact very couple new significant sign but States, faster organically you and had which had inside And than healthy What's the like

multi-year that much as board a up to we globalization. our for So really emerging in terrific performance. really has star in across years, us know, last this it you been a the but stepped effort been at two pretty addition the improve has to Japan and markets, Europe,

excited very, really what So know this offence we I'm the sustain to already inside the about complements the outside very ability which performance is U.S. strong U.S. then a

Bob Hopkins

think, kind to you growth been And specific the at can look the Mako of high then, degree is enough XXXX? on knee to in terms momentum you've just I Mako, that’s the knees this the such to a business been And the question grew, there the of cementless, your impressive obviously doing the momentum company. terms of look visible one outpace quarter as driver franchise you in in in XXXX. for Xs procedures since numbers and in knees, in you sold. super you in in business market terms knee are continue that systems that nice the I When of of XXXX mean,

Katherine Owen

We've that strong all trained mentioned, expectation. growth the the we it's we in really are got, surgeons clinical as data, whether Yeah, Bob, look positive. to, rates our fully amount all book, or that's points order in utilization the data

we quarter-to-quarter, of bounce to market around. points and up the think have take but ahead expect So tough comps everybody It's basis we for in We market. bounces U.S. market still wait to year against really recon the were the share. to this to we to fully by because report, continue meaningful grew going XXX

absolutely the expectation year. for that's So this

Kevin Lobo

expect grow the a over very and early we’re since the Mako, continue feel expect is To years full cemented was we not exit they that, frankly, add just to to even I'd And good we And stages, confidence still that XX% will about. to switches, launch. Mako also move Bob, to they knees. our two continue and year cementless in times will Mako, grow. Yeah, a learning the lot we to switch surgeon cementless. that their competitive gain once changing then they're with of when initially implant comfort something And

So their they're has are and the really patients. pleased with causing cementless still significant surgeons seeing runway that's really, what's And with results the extra uptick.

So strong will year be we in knees. XXXX believe another of above-market performances

Operator

Your next David the comes line of from Lewis with Stanley. call Morgan

You may proceed.

David Lewis

growth for quick question and A follow-up. Kevin a Great. maybe for

guide So, Kevin XX momentum several I've as you the with strongest mentioned think seen and strongest finishing you're, year obviously. in obviously, years the the I in

if Do the change relative a business XXXX? think a how growth same to expect relative you perspective? has XXXX significant from about you across from versus think in perspective those segments you will in business XXXX? the performed general segments other So Or relative performance XXXX

Kevin Lobo

business think Really strength a overall us a of for underperforming which tell year. would businesses, you been just comps XXXX strong I everywhere. similar spine. as we've hasn’t very there out one really would out will Medical, the Neurotechnology got But you've our bit perhaps grow been in is of should robustly. well similar the past in the some of still moderate that I has some I But performance given up David. move performances across Thanks, tough expect but businesses. the that got launch, little momentum then Endoscopy Orthopaedics,

each don't story but think KXM changes organic acquisition in dramatically, Now that our forma provide XXXX, sales, starting KXM within XXXX. quarter report will I our what we with pro we results. In

So combined doing. you can is business the see what

roll obviously, And XXXX performance in basis. on organic. pro forma will mid-single-digit then expect We a then, that into

the really these for is of pretty the that business with five excited remarkable. past that's post years numbers been the being we're speed with and flat essentially to integration able So spine

David Lewis

Kevin, Okay. thank.

can follow-ups, of in touch business Just you was Neurotech basis, that in the bps to then bps of Maybe that cadence in the confident the that range? that of in sort down that was you XXXX, Neurotech quick outperforms and much. the little only of probably any a XX only decelerated to for you XX you to was there. to momentum recovered, Glenn, out like take so margin? Trauma surprising concerns that already Or product a quarter was that. And and one Thanks two MedSurg business XX through – looked XX mix-driven for extent feel just you bit, so the very fourth the pressure light talk

Glenn Boehnlein

the very on on XXXX. Neurotechnology prospects new So, in bullish the I'm business,

As Katherine mentioned, Neurovascular exciting products. of new is launching number a

We CMF business; very they're have drills, Neuro the power businesses. healthy the all

as there. have of I very little that's and a part the expect Entellus performance see integration. quarter-to-quarter business reported that’s comps now doing continued from bit robust but We Neurotechnology you'll well an would it’s Big movement,

Kevin Lobo

lot of CTG two Yeah. pushed we've forward bouncing a MedSurg, David, the your question And years then, initiatives. on on we for the last with we've been that story as probably

orthopedic there expect robust burden growth side the lower in gross of of a businesses So out expense frankly The level MedSurg margins. is MedSurg. do they perform I But on of the do. minus lower operating than

can think think basis the deliver we're So, that XX to overall XX on so that we're promising. forecasting we balanced, points based I I we what

Operator

the from Raj comes call line next Jefferies. of Your with Denhoy

You proceed. may

Raj Denhoy

start Maybe I a couple little bit a now the in it's the Hi, performance to with for quarter, good of think quarters. emerging afternoon. been markets double-digit strong

in of markets emerging and of So, can anything terms point in you? the there you in those markets for if is to growth sustainability particular

Glenn Boehnlein

Yeah.

leadership distributor we year China, Stryker, America lot terrific very four the EMEA markets. the which year Turkey, most a business within we've really emerging is had a our I markets in all had new performing of double-digit you important the and quarters A Latin would say back And on this of the and nice put in think in China. America. very leadership So is performance. place XXXX. for performance as lot had thing I strong in bounce strong China. year Latin we even of Trauson for we course, India, had growth about years. Director a were of Russia of very made of know, part number working bright. Again, a quarters. a as first is this, a and year, the a Managing encouraging of been with outlook they fourth future. We well. changes some and out strong changes new of made sort very had the is Same had with bought couple pretty the we've tough leadership they quarter a beginning a and

couple for story it's getting So about the and talent been us in that’s effort firing been a us, offense of taken that's an a really years. focus

this markets. represents So know, to markets around I'm huge future trend percentage been sales opportunity position a been And we the have at since Stryker. Stryker's that's very us, for we're very emerging optimistic than I've And the in emerging that and as better small it a we'll overall for in at continue be X%. you of able

Raj Denhoy

one area. It's can with helpful. if I Maybe follow No. just up product

one So But areas? your been mentioned if there medical, seeing whether has for and are a performance it or no you're that biggest beds that fastest you other it's not other your while and stretchers. biggest Sage growing, in or category your areas also of particular strong segment now, within was segment but the growing, fastest in not really

Glenn Boehnlein

which that mentioned had I've in Physio-Control growth, was exciting. really Well, opening my double-digit to remarks me

the a U.S. have only AED the year. end the outside of it's U.S., We in approval got but of the new at

didn’t – haven't benefit. of that we So see any

And some had that more sales of we've a a business is put they terrific culture in terrific and So are ago. a really marketing years already there in really leaders Stryker's execution of sales Stryker this couple our and products. driving

up the had it Sage highlight. better of losses had to somewhat, strong but And but have XXXX, did actions quarter a think we'll make remediation. really so frankly that's one year regulatory the fourth XXXX a of the for in then I recovered in

Medical parts had It that other so And really very that strong growth. the in had was mid-single-digit Physio they our core very, business performances.

Operator

call of next Your Matt from Suisse. the comes Miksic with line Credit

You may proceed.

Matt Miksic

taking A there. for and follow-ups quick Thanks the the questions. couple Hi. Mako trends strong of on

market. track the Just come as to competitive dynamics this little a that curious what to see marketplace like a more to bit system little been have has about one, surgeons more been bit the kind of learned the hospitals in -- on have

maybe was overseas? really the in then year, I the of sort I up been significant just pretty it one for has that worth what U.S.? to has thought how about of unveiled noting was that? o-U.S. about, placements impacted that? back the And triggering curious And that talking in modeling So of -- what's we this if then should spine, I could. And do And follow-up a system step what have driver and

Katherine Owen

Matt. Thanks, Yeah.

with throughout we the in year, of we've given building that to been talked the I some and data, at only we've what robots balance name, on that with benefit execution haptics clinical a will the of the particularly the this out building clinical out ability come quarter got seen in the order the see which on August. call robot we've robotics had we and as last seeing record think with number momentum, about the a data to book. is we of or continue the And the on years really and there approach continued healthy

speaks factor benefits healthcare very and the single the or really surgeons one outside uptake entire geographies, benefit growth the mounting surgeon any thing sees. different driving given momentum same clear healthy second the it the Different which seeing U.S. group different isn't see it we are clearly are the seeing U.S. that And we systems, purchase it to that's but outside see continuing to the the is that hospitals building robots, So on

U.S. runway. the will we be to have think the big a lot I driver of continue

sales, rates, utilization that to comparison. easy will as data offering trained think do you really I it all you given we pricing, a helpful at it points system surgeons look competitive give the around make

Glenn Boehnlein

then go Kevin. That’s ahead, - great. on And

Kevin Lobo

Yeah.

small move to and that, just Japan. in only placements you that on number before have spine we China I’ll add Just

regulatory markets going be the think, big very they're in future, the given have we but for to don't the timeline needs. I still approval

We have approval markets big there. and started of hips, are course we've to just sell for which

Hong We Kong a Asia-Pacific will training used train on to also built be region that in surgeons center Mako. in

So the growth. continued we're very bullish about

I certainly those in two markets, rest Latin could to Mako good. in the in Europe XXXX Japan. great world, China not think will uptake I XXXX expect at see in you may continue think pretty of year to be a significant be and a starting But America, the

Matt Miksic

you're ask, tent. that into got so guess then a Thanks. I asset, rolling on great Stryker would excellent. question spine, opinion Stryker I our the anyway – That’s obviously, you've Stryker in the the – And into onto

which a products is in and of and other making integration? leadership, you to up. impact here that of most strong brought are de-synergies? minimize I are leading obviously What about, it focused maintain you the like printed variety focused plus, the a or on in potential guess, to set you MIS the and complex worried and You sounds what ends and sure maximize competitors the edge so on you market, anything if terms great or

Glenn Boehnlein

and taking U.S. most of the deal, That's the regional Yeah, territories, with so energy can the in I closure team, how clean moved the Eric part and bulk territories. leadership of of the the of I'm our which on fast they've all integration and to mixture on we environment, decisions a on widely overlap, the looked KXM is at is actually sales his at on important managers, looked you impressed all Stryker tell a team we this making force making integration. fast prior decisions people, the how the

products, once can full not know have sure bag grow and the are so surgeons the people and the that make to you'll access quicker And you the that, can their business of do you de-synergies. quicker have who

That's overlap stage, we ahead sales where in surgeon making the actual we than the or it been As we look at say that lose of past. The they're of overlap. news have clean be we don't to we integration, I most with the but modeled – the the of relationship. to sure certain what was went we force overlap you what and less a going is of didn't one that good modeled. we’re don't had lot team lose things amount that at spine know of watch would the that's in as thought that's reps closely U.S. and this challenge would there I sales deals a

the lower you seen integration. spine an give that is And risk with that's so each how on the but I is in what update than this single for we'll quarter previous And us biggest risk you've think going. deals,

Operator

the Chickering Bank. Deutsche with Pito Your of from comes next line call

You may proceed.

Pito Chickering

if product the afternoon, markets? Good that lines in? Jumping guys. growth your are drill see And you down of on most what emerging product we the do all you question, markets, line seeing Roger's into emerging growth across

Glenn Boehnlein

it's Yeah, well-balanced. really

kind So continues had implant the I in to emerging category in That's case. But that be markets We're our we've strong is and picking single soft there past. that really in that up an say, board. division up would product one stands pick out. business. Endoscopy area But pretty the a starting particularly that it's been the the across the of We've markets. not really to always emerging

Given very area In feeling be our But really business in overweight our get we've the a to I'm scale most go past, been about markets. really our a it and provides isn't focused one if capital the progress. in What is, area. encouraged excited have the to to stability that's and that that invariably small bit on fluctuations with just deal we capital and way able we're little to that implant rolling really long these then presence, I'm across in the grow. occur part we the equipment businesses about to the the

Pito Chickering

quick you. Fantastic. question a then tax right. All And for boring

full guided in you XX%, closed you proposed loophole? Did IRS the XX% impact tax or XXXX? XXXX. impacts guys Does rate that face either of any recently of in XXXX year versus You tax and XX.X% relation hybrid for that from the

Glenn Boehnlein

are we been an they've with year. estimating at coming as regs tax beginning now, have really we Right guidance and are developed monitoring sticking the of this impact we that we the And Yeah. pretty not much the been out.

they complex the moving some right issue more from impact we imagine, new it's parts target can But guidance So as the more don't an of see of laws. around as to tax that. continue a you now,

Operator

of Your Guggenheim. next from Chris the comes call line with Pasquale

proceed. may You

Chris Pasquale

line Katherine, bit outsized a other placements. Mako the beat in robot strong relative step had obviously Thanks. up of in magnitude the Ortho but that very to a the quarter, seemed

contributed XQ, You to in for there that revenue may were be XX that million. but from Was by up almost upside? else XQ segment there something that XX, and jumped $XX systems

Kevin Lobo

I'll mean, I in the take Maybe, line. The Yeah. sales obviously, that sales also installs related real that’s impacts but relates primary our robust one. robot, there of this were of line, Mako the mix that of to to impact

there. maintenance lesser that kind that And all with capital you're sort was also added of we a recognizable that line. and from higher hit So percentage saw bone cement. And of to revenue that increased up of kind price, erosion combined seeing of what positive

Chris Pasquale

fall earnings just $X.XX one comment that go helpful. wide your of the about you bulk would've one to That's back range for detail seems then, on impact to Thanks. this Could like of Glenn. expected impact currency $X.XX And the pretty year? thought and would a XQ. on the I

thinking walk So through your there? can you just

Glenn Boehnlein

operations rest forecasted to it also the Yeah. to currency. the probably It's to to early year. pretty depending we're of that's of very that own be Right in the year now, and expect what on moderate we our something impact hit happens $X.XX the $X.XX for And seeing it's and greatest obviously then, variable QX.

what now, And guidance right so is that's kind our we of based on where see. can

Operator

Fargo. with comes of line the call next Larry Your from Wells Biegelsen

You may proceed.

Larry Biegelsen

Katherine, still common of robot? think follow And in versus units us year-over-year the grow can think I about it M&A. are question. taking you was have one would up. robots. on One of for outright Thanks units said you placements XXXX, one Mako can grow, Mako, afternoon. can sales on XXXX year-over-year. guys I pure beginning you XXXX? remind grow contracts After XXX Do the for Good at of strong you volume-based how the

Katherine Owen

Yeah.

have absolutely robot to a robots So we installed the majority sales in and double-digit outright the year. this expect are growth of pure

Larry Biegelsen

sacrifice us about thinking you give in or can't flexibility operating remember And M&A, of And how a Thank XXXX? few acquisitions. XXXX? M&A Could XX be words, of Thanks where on a then, Kevin basis the In in the year for taking you much would didn’t points I you. questions. just you're would a to how willing margin that? do XX Stryker improvement you have Katherine, snapshot to on other

Kevin Lobo

source one cash. our In is number acquisitive. unpredictable. be and to to the not M&A I is you nature to use six planned as expect It change. That's inherently us of years, Well, would of continue know

As want to and we we're look offset out do not. related asset it an And see that figure to the or be can whether really value deal. dilution creating we will dilution, relates that we'll once going to we it for Stryker, think at then

communicate we the hypothetical we're high-growth are away very the we would are will you've caused but in table, it fantastic that deals KXM the and Entellus, was seen As our NOVADAQ, take detail to off offset wouldn’t asset margin operating core committed been the one In to it that then range, sense, have to from really a saw been We've offset. well dilution, that after margin that going expansion. able deal to then make we've drive to able say continue be we lower to I that. underlying doesn't in be us efforts business. to if

Operator

with call Capital RBC Markets. next the of line Novarro Your Glenn comes from

You may proceed.

Glenn Novarro

and were Trauma fourth we Hi, good a saw in than afternoon, quarter better on guys. quarter. Kevin, question Results third Extremities.

past big of So Trauma numbers. quarter. And on the calls about on law Have resolved? was those you the question Trauma, in the second just fourth of the digits. And not quarter? in my follow-up, been On U.S. Extremities. what my Looks in U.S. that third issues like is U.S. performance did then you've the the talked had in post supply double

Thanks. a if Extremities So on color bit you more U.S. growth? provide little can

Kevin Lobo

Yeah.

keep So mind in year. comparable Trauma double-digit X% a Extremities prior had and and our U.S. grew the in that we growth

Trauma supply in not get that were really back we And kind I the that third the are of to resolved us. So, Extremities. able that behind quarter you us. largely the would more issues be tell behind growth are The largely helped us to accustomed and occurred to problems but completely in

and first continues But already I range years in in Extremities up areas to when nicely. that XX% out down little with shoulder tell had performing business. attractive the within and shoulder It's the plan quite momentum we a business, really Our most XXXX XXXX. the but year we Trauma would really and business few the shoulder with that that bit performance starting another one in the have picked area mind in an come line ankle earth that to been in in shoulder overall you be That's Extremities that good more still market. the market for still in and built to relatively orthopedics growing we and short-stem a to share of expect with pleased low keeping will continue drive strong to very launch foot

Operator

James. Raymond the call from comes Larry with line next Your Keusch of

You proceed. may

Larry Keusch

Good Thanks. afternoon, everyone.

Just wanted you to sales. emerging circle back said Kevin, of on markets. X%

have making you've an you that last said years, scale several place got to Given that you percentage take as for when happy business been you in guys your So of believe what enough the the over there? recent you do is investment you think what another revenue sales? a way, gets

Kevin Lobo

that's in Dickinson is the higher companies that XX% med you that XX%. so average. that given is like roughly like companies, the than are below we us have The have challenge Becton portfolio companies they in average some Yeah, whether And product we tech NOVADAQ, an continue whether of A largely tend States. technology the to are that be a companies U.S. the KXM, lot United to acquire them, it's new Invuity, great the Entellus. it's it's they an whether in based

to U.S. let's double-digit markets continue every year. then so over I growers the be, emerging our expect And that weights to would business. it, strong single call

the those on percentage start a grow time, over as that to acquisitions does our as it in of higher markets. as long as so, emerging And it'll also long business tick

as rise we continue So that's U.S. the growth will we're that double-digit move those in the like in slow than ours markets, to company be me And lower to the growing U.S. down close down. obviously digits strong having X% in businesses like that's time. way double not to and more the XX% and digits great, and in up want plans. as be as we are scale robust double the X% over growing That's a slow if that for we long get plus emerging to markets important more size, by reality really getting to a growth. range in gaining is, U.S. we're our don't its but and have to can would magical number overtime that the in one emerging But percentage if it should I

Larry Keusch

just nice that in was beds mentioned and introductions. That’s clear. perfect. a new really made your business stretchers quarter as And and product without you the up, you in then obviously performance comment follow Okay, that the any

point the cycle? And So in the XXXX? in understand, cycle you XXXX, have do we I I a at last XXXX might the what certainly timeframe. question think As was there do MedSurg replacement you think beginning is, that replacement guess I the coming be of

Kevin Lobo

replacement continuous, of the replacement is cycle cycle. massive there Look, so sort isn't one

have on that their a to bring other buying We standardize hospitals wanting lot are technology. hospitals of You equipment.

new and meaningful the products, new We're mean frame with no an all say we constantly updating entire when features. we software. So

We that we surfaces launched. have new

there launch. until that beds, of always say those some of platform cost. within is have the products So well wait to the those really pipeline innovation. prefer But the we stretchers we are going the to good We're launches, form as any a both major There into as our to emergency not wasn't business, launched. are actually really suffice timing for get Medical those things

Operator

of line the Isaac Ro Sachs. from comes call with next Goldman Your

You may proceed.

Isaac Ro

Thanks afternoon. Good question. taking for the

commentary together of call. putting on So on the one want just here Mako, just to ask another some the

if and strong. accounts mix I that to down but already. replacements talking the at competitive And that additional that that, in about are place still have referenced from look existing obviously XX% at same still You numbers, a time, bit accounts pretty instruments is of over little Mako sequentially, opportunities you're the coming

together, of there XX bit thicker? the will little months, how given I mix that out XX, gets over competition if curious the all next competitive placement put I'm a So you think play the probably

Katherine Owen

Yeah.

wait number I pretty back, of north over accounts. and quarter, have jump look XX% you that competitive see. We've it's going XX% But each to to between if did consistently and as hovered think been quarter. reported XX%. last XX% in running typically we're to It we've

out to and launches. think comparative wait plays have with see I we'll how just to going it

the that have our robots. though looking to to comfortable clearly like, clinical before. to given have, feel to install the continue but probably around, really the it. move competitive the accounts data number we're will us, the hospitals unique features of part mix ability available new of robot been of going are What to haven't We this ends through we up be We going

Kevin Lobo

Yeah. thing. the And necessarily market additional competition think not bad I a in is the

really you believe some proven been welcome that value, system accounts maybe have a would you If haven't terrific delivers that head-to-head comparison. opened In we that having a to discussion.

saw of that in So, The robotics. And I -- as dramatically business. in the I years, if dialogue two market will robotics Mako everywhere. interest think it's a market the stay. last robotics will products changed. you to robotics entry tailwind other more AAOS want grow actually you whole and the are is tailwind in a And to They our here think for in about provide frankly the

Isaac Ro

component you other trajectory a this Orthopaedics. in of your maybe the a the more the the piece kind that breakdown I'm trend If stronger. Could if about on biggest read stronger? made reason sustainable? the biggest reason why maybe revenue look comment clearly of that curious that that looked basically just that's ask getting that to I is of Kevin the Thank revenue you you're on you. was mix the And bit capital you equipment piece little a And was continue the the Great. of and expect business follow-up just little is year I upside again earlier source right, a

Glenn Boehnlein

is Isaac, Glenn. Yeah, this

all If we cycle robust see. that most is capital by far you look at of QX, seasonably that first and selling away the

bone or prior And And quarter. combined combined then We're XX that line the up maintenance was in or which – lastly higher robust prior also was which hit as seen to rate through, so that the quarter, from obviously, saw quarter. really recognizable also there. come really produce out the we of in what then nature that in bone sales Mako we Mako year starting capital sort critical really significantly there just made lease just were And in see with rentals, then things, is revenue price. the a to less of of mass not in the the couple we whether of and numbers then you're And off positive a of not primarily than item, were robust of erosion of field. just whether installs, they that's higher in seeing just cement contracts really we've revenues cement, get which terms saw

Operator

with Your line next of comes Wuensch from BMO Capital Joanne the call Markets.

You may proceed.

Joanne Wuensch

question. and these quarter with of nice once competitive you thank really, what products How has? happens that Stryker Mako? questions the all into when for Two are sticky accounts Very get there, you taking the you utilization other

Katherine Owen

sticky, products system Joanne. in the the go a a But hip the well XD We and portfolio, force in the printed our sell, that opportunity they can multiple the faster by has sell is close. to from entire and system, knee plus pretty sales benefiting go in various It’s around and new systems. have first because grow Mako factors of all the accounts then

has the that effect in Halo we get So it once there. absolutely robot

recon selling accounts. Triathlon. just portfolio, growth products not Mako across in it's We significantly those So see faster our

Joanne Wuensch

what highlight give expecting And up, be with should a of us Thank we you. AAOS you there? coming can

Katherine Owen

to team do opportunity the senior also management have tour. a as We'll booth Yeah. customarily do we meet the with

mentioned We’re be there and KXM to will answer talk still questions Eric so having financing, some about the Cohen portfolio. as the on be I but integration of product to robot. anticipate will clearly Mako, the there Robert we

camera want We will and XXXX or out who tour that as Trauma products. that on booth the believe some new I management for will sign the was to any well so info senior part also folks our with the the at And have as on be investor tour the meetings attend of the team. up booth website of

Operator

of Bijou line Craig Fitzgerald. with the from comes call next Cantor Your

may proceed. You

Craig Bijou

Hi, guys. Thanks the for taking questions.

impacts on XXXX your and what guidance just the thoughts little And organic range. EPS XXXX? wider FX, Just uncertainty then, follow-up reason the maybe any are there's wider both impact how environment growth to guys see on picture, for just bigger can But concerns? a if the macro around for perhaps in macro you EPS. guidance. a Obviously, than It's FX wanted a the

Katherine Owen

the Yeah. macro we really good have also it about as We exiting comments. in businesses. stands, about overall good momentum feel as his And XXXX Kevin the environment referenced across we currently feel the

to there's we year. base. done more had a We're Just a in and more point keep much so overall. range Typical company markets. bigger a revenue so in mind, basis we're this We've similar larger variables there's acquisition, just

decade, think think I we're with things year highs that appropriate guidance I at. diverse an start recognizing the in So a change range and overall, big it's the a business, to

Craig Bijou

the just Orthopaedics, for appreciate at the helpful. I lower, a is had That's XXXX. then, the even bit your decreased pricing follow-up if for on little look compared QX. And Great. year in sequentially to pricing. full XXXX. and And Glenn, in from you at what expectation significantly one look if QX guys It midpoint comments you you

is there. So the perspective? just from thoughts I mean pricing environment getting better a

Glenn Boehnlein

Yeah.

things. guiding I of mean about think a year. this to we're couple both we the next what if price, and think, year performance I

from, year used if be you it at where a growth mix also to us big will And susceptible there I look next think year our some are for we it's to sort price. of ago. MedSurg that the less same than the think bad international to expect But sales. just a true grower obviously less I be come and holds for of of

given environment, better little XXXX. maybe a think sort will see pricing similar a we even mix, that of I So probably in

Operator

comes with Cowen. call of line Josh the next from Jennings Your

You may proceed.

Josh Jennings

laid generated? better? you And growth November and and the maybe going you've business, And out-achieved of you're headwinds what's I basis Good that margin evening. understand stronger-than-expected the with It that able start point out the that really much back you're think, performance end volume to hoping points how acquisition was top in experienced just Thanks. range. help like to to you and in XX I going of of a on is to driven, revenue in basis core the the stronger sounds you've program, tagged us core or business? performance XXXX. CTG absorb XX the operating outperformed just And outperformance Hi. XXXX out-achieved off expansion the having

Glenn Boehnlein

Yeah.

as is, you I will and as certainly flow approach to there's all think, by leverage disciplined couple done about so margin. much and of over-performing think so businesses think our incentive acquisitions, of lot of about their a things much that and part they the puts of really A that's say here targets impact they I a first how plan performance need that through of of everyone's a covering Stryker. there's at drop through, takes that all, it's

come from benefits indirect second of the we those that that, near-term I really point is reflecting spend can benefits obviously see the drop-through to programs, of through have. The and we're some thing in amount to those programs these like shared would starting and services, CTG are

had acquisitions sort to amount that during sort of squeeze margin integration can G&A dilutive those the side of op we so performance were on of On especially we we of push flipside the very those the margin. better efforts out even out the And the things year, of the as of given of that, can, acquisitions. we that quick as

Kevin Lobo

to that new half start you been know a Speed versus negative heavily first last the these year of you where, and the the we abate are. speed getting and obviously, will a increased tell But I and speed or can three And, KXM dilutive of over integration that Stryker because as be good there's public has in taking would ago. it they in those dramatically change dilution even of companies; traded how dilution are example that's mantra noticeable years. a out our synergies. see is hold those really pretty the four obviously, integration is years the drive of synergies you will at two

Josh Jennings

application guess cutting faster some lack points and different of to competitive going cuts. the making CT saw you're front robot? And to defensive to things -- ROSA for going thanks. is standpoint we’re total for I the AAOS, be the think do features, robot the maybe the surgeon of the a robot understand of the in just for scan, some maybe some the coming Mako the from a be own debate I Great, features for actually to that going the competitive new against. defend their of initial And as allowing with AAOS questions. and maybe Thanks versus Mako registration may versus versus taking launched Any knee to competitive at market, need of some

Katherine Owen

we're robot the executing Yeah, ability the to focused balance the and stay strategy that’s to about data and to features around continuing outcomes. continue we've benefits our on talked the support and on going that to the clinical

data utilization surgeon easier that those think on trained, got we've clinical data of we number points report placement, compared whether the data valuable competitive to it routinely its offering. a should points quarter I that that with it's rates, make same

So I here that is the Orthopaedics and market. robotics in think absolutely it's it stay validates impacting to

surprised this not think we changing we're we're So the to no stick as and way our strategy one also because its competitive about responses, in beyond. it's we're seeing think year clearly and successful but been we with

Operator

Kristen Your next the call of line Stewart with comes from Barclays.

You may proceed.

Kristen Stewart

to an fourth you Hi, earnings I guys, growth. Was digit fully the on that's see my quarter? just not Sage you Wanted from the commentary is taking for that year? floor said mid-single Good think full perspective. to the for intact thanks said, that call. for assume the still I clarify just

Glenn Boehnlein

up was year year, the so fourth digit; was fourth No, the Kristen that quarter, quarter it in picked was mid-single-digit. yeah, full full double

Kristen Stewart

think expect how business what perfect. better for Okay, it to Obviously, And I'm then just about forward? you continue we that should understanding. going to get from

So think you growth or the that I will of had profile double-digit it that single expected back the acquisition? time into, was at evolve high

Glenn Boehnlein

pipeline year expect it's really to would to fourth of a quarter XXXX. a great business. We better with exited be ton The continues than solid. be I momentum. XXXX the Yeah,

be new really we'll that products interesting a couple have of XXXX. We launching in

business interruption. little to growth the us hit So, But had starting growth. back low were a the I for that to their should efforts that to we there're that would stride now contributor categories get And future. Obviously that be to continue the solid took reliable during very very and that product expect a significant. and our severe, foreseeable the couple remediation business double-digit be longer high-single-digit, to lost of

Operator

line comes with of O'Brien Piper the Jaffray. call next Matthew from Your

proceed. You may

Will Inglis

combination in wondering of through and months, for in ischemic full have regards retrievers? sometime some in you is the thanks wondering impact on or if And that's standalone to bucket I will question the couple seen questions. next would with Will for the time utilization portfolio for first when if broader Hi, in me, a terms in guess, but stroke of be, the expiration if it's This neurovascular, hospital wrong, what as of used in the system -- of it ischemic launch you've my broader correct drill being Matt. pull with what I'm terms contracting?

Katherine Owen

Yes.

of a the to path. those with strong first. So factors we as to first who times to do only Typically, in have the a because it who of not those able a to have But using the but that of impact. most the stages neurovascular using be is have Aspiration we're XX% data in this to launch, surgeons an for is really clinical to go with offering going to you you having the are one the think stentriever the wanted time year. with has terms but that's back stentriever currently early retriever, growth very it's we of absolutely XX% Most of demonstrated prefer in surgeons the what contribute conjunction go

of mix is the it much two, you to it's too So, or a the two. tell between early any -- specificity with the will what but how waiting be

Will Inglis

Thank to And great. your portfolio regards spine strategy near-term? top now three, Okay, in any kind the placing four, the us enabling advice of with then combined five you if Wondering with technologies can the in you. providers. give

Katherine Owen

early. very still It's

get big deformity think here thought a refresh, the product with we leaders with market key has KXM market. right is I the we get a impact foothold now that immediate strong in in the this an

have offering And out-years larger that's an robot talked we've market, off. across think previously, and a the offering. also have the I but longer term sales bring spine expanded We well about much years Board position us in we still the to we expanded as and XD-printed and a this force more then

Kevin Lobo

their right the the given has I the been future better tell are and that early organization pre-planning quarters, we'll team preplanning the our have mapped, And synergies, Yes, that that been getting one. in I short-term the the focus now, our has Eric as in system the having well own looking in had getting job evaluating but getting sales navigation. sales the They organized as idea main would tell Robotics. technologies, leadership sorted, you has you force a the the focus success. really really force been would on enabling at for

Operator

comes Vijay call ISI. from Kumar next line of Your with the Evercore

proceed. may You

Vijay Kumar

nice my Hey, Congrats on quarter question. guys. Thanks for a taking here.

that you mentioned guys in you comments anything -- the on means next sort new what put competitive being the Q, from driver, the even back competitive disruption? cups like think was as as that any hips? the it disruption when for the products on Just all other And all I there the bucket other XD-printed there it for about you that a a was any Ortho but year, cement outperformance, you not bucket, drove in on the see perspective, of bone in did and in can XXXX? think just and And coming knees fold some in outperformance in front? what

Katherine Owen

now Clearly, had We've including hundreds X.X% XD-printed the see selling surgeons. guide new exposed surgeons it our So it's to we're hip to impact to one behind of factors of of of cup. the X.X%. the revenue competitive

are our I cement, cement a Bone in as think Knees was decline we significant, we're quarter. that's bulk MAKO well overall continue pressure to market fact some still feels strong in it, And bone think more relatively the the comment I similar clearly ramp-up; Glenn's about less the the seeing although, really our we're cement-less. now overall. competitive knees from is that as standpoint the offering. XX% of is a it affect of the that over third

think most related. share gain what seeing is of we're I

Vijay Kumar

really large here. give of like M&A how are on guys and Can the looks margins then concerns you A one headwind mean, margins That's I more is on on strong. very eating? us guide much maybe just And that coming the sense is margins really this is curious dilution. on to a you helpful. strong? it underlying was just I'm in

Glenn Boehnlein

and But is ones gross to that line Yeah. when you down accelerating margin bigger really selling and across-the-board at M&A impact of liked need the on At some then KX. we'll the that the focus you see. look favorable that in the we XXXX. the this actually move sort you When – on of of become doing at the we're I'm them of for that XX headwind relative expecting sales basis all continue to that's couple quarter, of so headwind. the through first ramping almost and of dilutive year, saw year will SG&A, quarters points least especially

Operator

Your next from call comes UBS. Matt the of line Taylor with

You may proceed.

Matt Taylor

could did question. the main I about more of talk or and for you I sequentially Hi, quarter And ever the are color it that's of outside thanks your past. wondering, book, or talk the this over us taking was strength you in you what ask on areas I quantify think about some about heard want how time? Mako? improved And if more to you order it I've give

Katherine Owen

but XXXX people of up to it's somehow that it the board quarter we the not. the in quarter our quarter camera. want end a excited also the for anticipated businesses. of a convey the we about had really candidly that. across facing Mako, gearing had with didn't we really was strong at order obviously, the pull-through It's that launch first the first We're capital We're,

visibility book out quarters. order good their it's is so a really And a into across-the-board. just going have and pretty Medical we usually a growth strong having few

we thing just the there healthy board year. So into pretty is highlight. going no would across one It's the feels

Kevin Lobo

a the even order we guide, to strong strong order growth the a of Yeah, double-digit book growth and book. a a double-digit guide is notice strong we're instruments In had starting off more let confidence on the and part board. year with a top really book. behind really we’re bit reason you order instruments order the significant that growth, have sharing on And very a know guide book little you very if of is organic strong across that comparative

So year momentum. with entering good very the

Matt Taylor

here bring to the just and I of really expertise you procedure versus of we gathering robotics there to the relative And lot areas Do that data as spine, go Extremities? you talk knee Or in clinical slightly sense. but the car curious importance make around versus can develop expertise robotics I'm that spine as about That you think nuggets outside along. using that Mako, are your on of a you're even tissue? wanted Great. you your other can

Kevin Lobo

robotics and with have for that. starting so opportunity on now Yeah, tissue that hips the and and We now. at early too working our hard we premature like. that's tissue shoulder focus we've robotics spine and hard are about It's for obviously, that launch and stages potential clear is really what right to talk It's been that’s But our not looking dates very knees. certainly teams going tissue have a to We're us with, right focus. certainly focus. really look soft robotic

Operator

Canaccord with call Kyle from next of line Your comes Genuity. the Rose

You may proceed.

Kyle Rose

that high bring overlap recon. Great, and Stryker an technologies NOVADAQ for differentiated want Kevin, the questions. on some you acquisitions breast sentiments last both in competed much level XXXX has XXXX I area health recent historically and the – portfolio, if not thank I But to the women's quickly that And to talk just where about in obvious business. both, across leverage I very both to and a the from strong core a of think in on the being Invuity they reiterate taking QX.

the portfolio? mean, So sense, strategy these division as just the far do here as for you position how I a in view that the portfolio and maybe direction larger assets

Kevin Lobo

products. us would so catalyze And of and sales that Invuity did within broad helped Instruments, it's force. pretty So start of with what a I'll split Invuity portfolio to

covers to that on surg management, tools, has and that different within the all the unit So it call surgeon. has gown surgical power focus It account Instruments of points. those has frankly hard the also waste Neptune

beautifully in point. that procedures fits Invuity as surg account And the Neptune in call management waste as well so with

well and technologies. force area. And a created as as then sold surgical we've specialized Ortho are that products Steri-Shield called Instruments the the new So the sales really all in includes power tools orthopedic that

specialize it catalyst sales last extra force kind low growth seen be and our you've us So performance decade focus a a Instruments anything drive after the double-digit year to or over of and if been amazing that's very year single us helped what high continue after year. very, for to of enable as

in not a new actually either invented really that's it's It strengthens recent So that basket of something or history. we've a products call point. acquired

technologies As know we'll going continue asset Stryker the to to can Stryker We is into we'll bring our if of how areas, to continue continually we and can great new something whether, a bring And that sales technologies since. forces, But to just specialize sales that's biggest get our run that force our offense drive other that. them do at. to we're believe points and sale looks growth. new we to force high call if

Kyle Rose

guess to of seeing I you're on mean, you then still side. to just TKA. talked know but talked just procedures about XX% follow-up you I'm And the being trying U.S. you Mako about an cup, the when XD-printed hip Great. the how a when seeing your in the centralized about understand side? competitive to knee are Mako staying the And hip over affect they Mako opportunity with is accounts Are talked new I of much I the see you're more the them there in trial bringing that on really portfolio? XD a then side? you hip really

Katherine Owen

great especially see it's the a opportunity of launch cup absolutely We out trailing, them No. given Trident the there. II new

knee going total on So that's biggest the of and But the hip Mako patient benefits. once of the rates. can was unmet the the of the knew the the to continue of we or always side you given part start to benefit increases some believed need account adoption surgeons you around to and see and the we that be dissatisfaction well see sell driver the get offering into as totality and

we'll dominate, absolutely I knees XX% the So given impact of see think still from will procedures but an the hip.

Operator

from the BTIG. with Zimmerman comes Ryan of line call next Your

may You proceed.

Ryan Zimmerman

congrats well. Thanks quarter for the squeezing on me in and as

MDR for know So XXXX in me, European making a just year. the regulation you of kicks-in more XXXX transition question one

out any make sense? appears regulation Europe, onerous. incremental to do any you. European surface quite we coming of costs markets about in this or I'm you remove don't the that's from if – place intend just potentially wondering, be should SKUs it Thank thinking maybe that Now the

Kevin Lobo

move year to working approval actually been according on course past Ryan. in regular We've the of year. the Yeah, – in from our non-GAAP related received And with our sort accordance new the them with the to policy, – earnings remove over process of on we the regulation registration our non-GAAP. those and early costs our to

of cost seeing, terms guidance in the costs, remove. and seeing really the extra you're you're the the So excess getting numbers you're

the to would flow correct that forward item burden we we any our regulations a R&D relative going you're that Now, regular to regulation. as through up standards have line related might

Ryan Zimmerman

Thanks it. Kevin. the Got for info,

Operator

no remarks. are closing Kevin time. turn I at There for any further Lobo will Mr. now over questions this conference to the

Kevin Lobo

Well, all for you our call. joining thank

for XXrd. on call held results XXXX first conference Our will Thank the be April quarter you.

Operator

today's you, This you ladies conference. gentlemen. for concludes Thank thank participating. And and

disconnect. now may You

Stryker (SYK) 29 Jan 192018 Q4 Earnings call transcript