SYK - Earnings call transcript Q4 2024

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Operator

Welcome to the Fourth Quarter 2024 Stryker Earnings Call. My name is Luke, and I'll be your operator for today's call. [Operator Instructions] This conference call will be recorded for replay purposes.

For your planning purposes, and given the amount of content we have to cover, in the event the call runs long, we plan to end the call no later than 6 p.m. EST.

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

Executive to like Lobo, turn over to call Kevin Chief now the Chair Mr. and would Officer. I

proceed, may You sir.

Kevin Lobo

Welcome to earnings quarter call. Stryker's fourth

Joining Group me Finance and Vice are Andy today Glenn Boehnlein, of President, Jason CFO; Stryker's President and Pierce, Neurotechnology; Investor Relations. MedSurg on Beach,

will For during expand today's strategic pending some rationale quarter comments followed I'll Jason the open the and on follow we trends by then Andy, the product with saw our provide who updates. for will acquisition. call, Inari

further to XXXX well Spine Glenn on call the as Finally, elements and as before Inari financial details offer Medical and Q&A. XXXX open guidance will our . we results

as very most you Stryker his after Preston company be very positioned in who delivered in X, thank by Fogel know partnership Glenn have you outstanding as the the leadership as consistent April would with effective leaders and the retire and release, strong for results a decided replaced press it me to like Relations significantly, I Glenn time future. X-year Investor CFO. grew we great has He from tenure role. Wells financial to for our will his well and First, from of successful our saw Stryker

X.X%. from for exceeded continues represent International growth. in Against our QX markets instruments, businesses and endoscopy, results, sales strong by organic organic XXXX our year. results were our U.S. opportunity cranial both was performances trauma organic Europe. a for neuro year, significant and organic comparatives and for XX.X% full were XX% QX full for impressive year Canada, and full Full the international growth to growth the International sales year. ago, a the was to recent double-digit both an both and growth medical, excellent, led extremities sales year double-digit and delivered emerging acquisitions. move let's all businesses sales Globally, legacy Now which in

excellent margin including in dilutive full XXX X basis goals, the XXXX. XXX had performance, also adjusted the year completed versus our from QX in acquisitions operating basis improvement the an We we for earnings impacts delivering we exceeded XXXX, points that of points and

of to M&A focused QX driven growth $X.XX [ XX% for year high-growth XX% power. strong performance as growth and This of durability well commercial and comprehensive terrific Our of as ] our demonstrates and full adjusted EPS by organic execution earnings the offense, $XX.XX year QX represents compared and the full XXXX. innovation,

momentum and delivering reflected our Medical, have to We $XX.XX the before This which the XXXX growth at X%. of impact Glenn with growth, operating med $XX.XX, entering growth full high sales continue an translate expect to Inari end which of of guidance is cover. in to organic adjusted XXXX margin share sales of year expansion X% of per continuing considering will EPS tech, combined

extensive sell of us will new faced our to and spine hands announced that market the challenges experience This align it in has Implants expectations. the in performance which business also Spinal agreement our an allows in Implants our sale We the business, to achieving owners Spinal better have resources. place

was fastest-growing to businesses is one excited the and of of about Medical. Spine, our We continue Interventional Vertos recent by bolstered acquisition which be

markets. Q decisions category in System, Mako to high-growth Guidance continuation we Spine. attractive, drive market, Additionally, enabling leadership the for portfolio and remain These strategy of technologies spine committed a end our reflect to our Copilot including

turn now will Andy. over I the call to

J. Pierce

Kevin. Thanks,

market vascular of a peripheral their service. is our complementary parallel Our and adjacency entry sites division to logical product the given portfolios Neurovascular into

seen the the of a of be $XX chemical opportunity Today, fast-growing a billion treatments less will opportunity. addressable thromboembolism thrombectomy in the U.S. will comprising ClotTriever clinical of And VTE. clinicians and representing X/X are opportunity of their effectiveness, represents area leading bringing care treater treatment the growth Mechanical a believe excess for tremendous billion $X portfolio. are time with to of mechanical the supported products hospitals as player gross Inari, therefore, annually its and VTE in flow or Solutions, with Stryker margin VTE. Since believe in has We of for XX% our for we, revenue significant Inari acquisition over elevate profile for thrombectomy With for XX%. that by of expand XXXX, this standard with market to opportunity which research Inari thrombectomy. approximately venous look demonstrating than

presence These ischemia. for and Inari acute limb treatments to other incremental believe its ischemia more Together, management, globally. market populations. limb-threatening to Stryker's represent exciting over has Inari help invested into address We billion access emerging rapidly VTE, dialysis disease, $X chronic include addition therapies in can In international venous opportunity patient they segment in unmet needs markets. X of chronic global therapies

of customer of and capabilities the patient Its the outcomes years, been comprehensive In Stryker with a portfolio. will XX parts more interventional neurovascular certain launching accelerate have endovascular approximately procedures. primarily a international needs. And global By equipped both and organizations, over clinical opportunity is Asia. a Inari, business and in interventional of with will we greater R&D made of we innovation be X% meet recent long addition is has helping leader strides has sales. in globally Inari in Europe currently and markets, improve to

go-to-market the a Inari commercial our and attractive aligns commercial in our that Stryker's mission radiologists, brings strategy excited interventional exist a significant includes infrastructure, with we including and great Inari's Neurovascular. perspective, From operational model points, cardiologists. which with and call between vascular organization teams. interventional synergies surgeons strong about are well culture patient-focused commercial

and Inari thank and like this I Hikes excellence clinical the company driving Finally, incredible strong years. the through team extensive segment and building for that an a entire Inari adoption has last mission-driven lives. improving and patient over would commercial job to is XX-plus Drew leadership recognize studies establishing done

best-in-class history clinically to I'd M&A, also record continue on in sales exciting in significant ensure customers value. complementary a team With track look pipeline compelling the technologies, our like have and world-class customer-focused investing companies. shareholder achieving force, deliver through an efforts to a our conviction long in and successful we forward highly X portfolio we performance we innovative in for product this their With segment. of ability tremendous drive our together bringing Stryker integration, solutions thank to to a our and create our to

And over with to now turn that, will I the call Jason.

Jason Beach

as to fourth healthy environment will as strong My markets the on in Mako, by and remained continue will Andy. remain demographics comments and update levels an update activity. robotic-assisted Procedural in underscored to our adjustment an of expect today Thanks, product on on the providing launches in quarter, an the the healthy volumes external focus continued well current adoption patient and favorable we XXXX, surgery, reporting.

Hospital capital capital and and Instruments in full in remains across Additionally, products the medical, enter elevated growth order book robust quarter double-digit growth as healthy strong X with our organic remained year CapEx for and businesses. the all Endoscopy we demand for are XXXX. budgets our

approximately direct-to-consumer Next, of growth of our progress alongside U.S. has and year record worldwide. our installations in year. we utilization. Mako specific The the to resulted In the of in Mako, using XX% U.S., installed Globally, as and exited continued our XX% and offense, we we had of and in quarter base we hips exited performed knees increases the with of X/X including campaign, over year using approaching Mako are another strong just performed X/X Mako. knees hips of of the

increases. Spine October, remain and completed its significant as received Mako and momentum first surgeons we in Mako feedback. have adoption We opportunities excellent cases

second and U.S. track to our We limited the commercial in year. release on full of market will continue the launch through remain progress half for

Next, approval December. able first our from for FDA perform our cases to and we shoulder in Mako we're received application, the

of excited a to shoulder ecosystem Shoulder are complete which and our blueprint, portfolio implants. preplanning offer software, for now a Mako shoulders, We leading includes

XXXX reminder, be As carefully shoulder we experience. also limited Mako a for launch gain clinical a will year as

launch in expect the by U.S. of full XXXX. We a QX

momentum continued to driven positive product our recent We launches. by see have

customer Our launch, its growth. seen robust system interest Pangia driving since strong sales has plating

interest book. order XX Additionally, continues sales and LIFEPAK defibrillator robust along monitor draw meaningful performance driving in to our a the with quarter,

adjusted the have our are we better external we reporting divestiture pending implants align business. Lastly, reflect spinal with how to to internally the and of organized

part Effective results reported of other of part Spine enabling in are reported neurocrine. results Interventional as as orthopedics and are Spine quarter, the fourth our technologies

is implants within spinal reported result, now a orthopedics. separately As

With that, turn over call to now will the I Glenn.

Glenn Boehnlein

related I focus my results Today, on financial will the quarter Jason. our Thanks, fourth drivers. and comments

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

the in to of XX.X% the was Our in organic sales quarter XXXX. growth compared XX.X% quarter fourth

and We more contributing quarter selling a and impact pricing had X.X% both the XXXX. This favorable X MedSurg for Orthopaedic from positive Neurotechnology pricing quarter. had segments than day with

Foreign currency a X.X% impact had sales. on unfavorable

quarter, in the and momentum International Canada, positive emerging growth Europe led X.X% XX.X%. U.S. sales In sales growth by sales organic was organic and was our was markets.

and sales organic was was XX.X% also XX.X% organic year. was international our a comparable strong year, growth very year ] of last growth the For [ full U.S. against XX.X% growth X.X%.

from full is favorable price the impact X.X%. year, For the

Foreign more and had currency XXXX. had X unfavorable than impact day selling a X.X% XXXX

continued driven by operating expansion was from and quarter was XXXX, fourth EPS margins adjusted $X.XX Our up XX.X% the gross of margins. higher

of impact unfavorable Foreign currency had $X.XX. translation an

$X.XX. year EPS margin $XX.XX by XXXX, currency growth expansion of adjusted the offset partially of impact favorable sales and translation foreign reflecting of full Our of operating unfavorable from XX% impact up was exchange the

performance. growth XX.X%, sales Now led international XX.X% SteriShield. of healthy both sales sales constant organic I growth growth organic smoke segment From a orthopedic was X.X% in MedSurg organic of with will included and Surgical of XX.X% and which In growth and had provide our quarter, organic implants some U.S. management, had of product around and X.X% quarterly U.S. waste and the Instruments power highlights more growth Technologies tools sales perspective, Neurotechnology of the growth. evacuation, businesses. by growth currency

sales was led in our and renovations XXXX Endoscopy OR the all businesses. growth double-digit Medical platform success in capital Sage growth video shoulder by for growth products, Growth infrastructure product fueled strong products. robust XX.X%, by care continued From and of quarter by performances in led and XX.X%, sports strong of driven the U.S. was and sales demand business transport and across sales of our by had organic medicine defibrillators. U.S. perspective, Sage medical beds, the emergency had businesses. organic a growth the

a a continues Neurovascular performance excitement drive with reflecting business in in our growth craniomaxillofacial sales organic high-speed neurocranial and And pressures ischemic bipolar market spine and competitive finally, XX in led pipeline. order to organic growth strong XX%, bone our had sales accelerating improvement in strong by and LIFEPAK U.S. forceps, the XX.X%, of U.S. growth products. strong hemorrhagic against mill, our business. interventional of drills, had

As neurocranial Jason growth changes now numbers with now reported the a division. our interventional of reminder, as reflect spine that discussed our part earlier,

had in Internationally, performances organic of United Neurotechnology sales Instruments in and MedSurg growth strong Endoscopy our this by led included growth businesses. X.X%, the and Geographically, Canada & Kingdom.

growth sales sales growth U.S. included internationally. XX% currency organic of growth XX.X% of and constant XX.X%, and had which the Orthopaedics XX.X% in organic of

Our strength the continued robotic-assisted knee new business X.X% our position and installations. grew knee market-leading in from Mako reflecting of procedures our organically, momentum

business U.S. Our success platform. fueled our hip stem continued our X.X% hip by hips of Cigna of organically, Mako and grew robotic momentum the

adoption amid Our U.S. strong extremities ramp grew growth of performance core robust businesses. this with The interest in business sales XX.X% portfolio. our continues upper trauma very Pangea and and organically differentiated to plating Trauma Extremities of and double-digit

in Our quarter. grew business U.S. organically X.X% the spinal ] [ implants

XX.X% Our in which strong decline a X.X% including Zealand, performances grew Technologies, business, Australia, and in Canada. organically, bone emerging Mako cement. driven organically, U.S. Enabling mix deal other markets, Internationally, includes by grew now Orthopaedics and New Europe ortho our primarily

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

to of than Our XX.X% driven pricing, fourth and quarter Adjusted points the was of by This primarily was quarter sales, XXXX. basis manufacturing which compared R&D favorable was basis adjusted lower improvement gross points XX mix. of improvements cost margin by spending XXX was positive XXXX. of fourth the X.X%

fourth basis XX points was quarter adjusted than sales, the XX.X% SG&A lower of was of Our XXXX. which

operating summary, In to margin quarter, was of XX.X% fourth the our was the of adjusted basis points XXXX. quarter which XXX for favorable sales

our XX.X%, quarter for $XX which XXXX, full $XX XXX For driven XXXX. quarter the debt full basis of the than issuance. by interest was September a year, expense point increase other expense operating our of to margin Adjusted was million was higher million XXXX income higher a over related adjusted

from year For the our interest acquisition September expect to impact XXXX, primarily of we Inari, other income additional expense approximately of excluding $XXX the issuance. full full pending our the impact by and year XXXX million from driven be expense debt

impact year tax XX.X%, fourth tax and reflecting of respectively, discrete the an and items. and effective XX.X% Our certain geographic had mix quarter full of adjusted rate

XXXX, in to year be full XX% For rate range to we effective XX%. of our expect the tax

balance $X were billion fourth offerings with billion short-term in securities investments. We on used of of marketable $X.X a Total Focusing of $XX.X billion and $X.X sheet. approximately the includes approximately to was ended debt debt year billion of proceeds from XXXX, the September during down our the the bond which pay and cash, quarter. portion

Turning to cash flow.

full earnings XXXX and was million $XXX year operations payable. and an in of higher XXXX, Our inventory driven from billion, $X.X cash from improvements mainly increase by accounts

$XXX the anticipate we be do any will XXXX, anticipate million buybacks. $XXX For not range share in of to We that million. capital spending

and momentum expect strong our share to our is expect organic the end products And a $XX.XX earnings net exiting to operating XXXX volumes year and margin impact presence to assertion considering of will in demand to we be XXXX, which be provide full to of Based margin adjusted with of for net XX.X%, growth sustained XXXX, X% the levels. improve on assumes year level in adjusted range capital Inari. previous procedural the to pre-COVID line guidance of a now our healthy before for sales X% of our This markets, I per in op in full guidance. $XX.XX, range

our reflects is modestly impact the guidance of sales that Our favorable. price year full expectation

anticipate full both near and unfavorably approximately will $X.XX, current that foreign earnings XXXX. we sales the of will year if which have in number impacted to the same the adjusted exchange be Additionally, in this XXXX. $X.XX of as are selling XXXX, of impacted rates Compared selling quarters quarter share have of reflected negatively remaining in for to be range our guidance. year of X% per will hold first days we day The the X fewer will levels,

the while margin our we earnings XXXX. quarterly did to Finally, seasonality op of similar to do related be guidance, expect and sales, we expansion

As of of billion the closing hand this fund February. cash Inari it the expect of and transaction and the new purchase relates debt, mix towards to close to a pending the end we acquisition, price to on anticipate $X.X

XXXX, margin and points For $X.XX impact XX XX-month December on to we the approximately period EPS. X sales basis approximately to a dilutive constant on adjusted Inari expect a adjusted have ending of million in currency on op of $XXX to deliver basis and $X.XX

into growth, of our spine As business, net the implants above it this divestiture operating guidance adjusted expect transaction relates sales that to of we the margin impact the will adjusted EPS. and be for absorbed

I With that, will the Q&A. up call now for open

Operator

Our from come Wells Instructions] will Fargo. Larry first Biegelsen question [Operator with

Larry Biegelsen

just strong on the to sale. spine finish start the wanted year. Congrats Kevin, I the to on

first, and Preston. both congratulations -- Just also, and to Glenn

was million from just economics just any How So deal, Kevin, how I offsetting follow-up. talk this the BB, much sale that deal? on dilution the the had sale, about of price one $XXX right and of spine why going to the And the you're time? is

Kevin Lobo

you time? been Spine time, this at make we've business. now been a long trying market in and Yes, for Thanks, improvements the Larry. we've Why know, to our As sure. is looking

the innovation enabling in We Brothers Spine, going that's are excited provide experience And have lot about to to the our with funds have fundamentally, of tech the in and follow-on in opportunities business. but Copilot side the spine. VEB of just other invest better implant the businesses. They're a Mako required

As you be will saw in together. the press we partnering release,

to So implants. we expected be will entire providing million The them. the providing to enabling They will be be $XXX tech. is divested the

the one other those that of in market really neurocranial energy. our we've so side orthopedics. where other we'd where of IVS into just other we're moved had the as our that things faster-growing we've innovation And we It's, same and the our spaces. of into many have is business like -- being so you to the spend into haven't just other been technology this competitive know, enabling parts and And It's time very of moved implant where into degree portions portfolio. keeping a the on remaining the moved had

We like got really right the So time. feel hands. we've this The in a will great partner. felt good be business like

will be good and employees are so hands our in Our customers.

Larry Biegelsen

Andy follow-up Inari, for And for maybe on Glenn. then just or a

Just How return math, By seems deal assumptions. maybe X. does talk invested turn the ROIC in do deal this our you relatively X the about in capital of some year on low see when And years? accretive?

Glenn Boehnlein

when to about Yes, on it too at sales we Inari And the from will we'll the get of target this. fits honestly, an don't and X-year Larry, then of the sort years. excited We're favor. public We looked of us expense that at with growth that you sales the thanks. partner your talk our we modeling hit synergies to but and about for that to I there feel the sometime in accretion and EPS, we will we them. back the from that normal ROIC impact growth, whack say we between model generally our to way are And company be on our additional most feel once it. And own borrowings X EPS And have down on terms guide X of a operating squarely level. or obviously, would as much, of to comparable super result the dilution opportunities related their standpoint, work in lot income mark to interest really in especially

Operator

come Marcus from JPMorgan. Robbie with question next will Our

Robert Marcus

and more is working and retirement. really was follow-up questions the way, nice of a in and and the people your range absorb Larry's able on that great It's probably ask you. a quarter. that expected sell you Congratulations you on on It it Maybe margins. guidance you the to a wish one existing another really still lowest this be impressive best P&L businesses provided Glenn, with of we could operating growth focus. in

at moving it left we was afterwards? here of that today, And before expansion the basis So how your into Day got color maybe today, would go time there is points any get helpful. look a to a little pieces margin good you get to as really structure and over XXX-plus planning dilution? what's ago. this -- and you still were And from sit just year year But a to that be helps at Inari lot the what blocks building where a that you Analyst there's

Glenn Boehnlein

so sort about we've Thanks, our Gosh, footprint. we excited We're you I sort in there's at how recently GQO as structure, of many opportunities about sure. look Robbie. our Yes, still that our look tell we P&L, look think I manufacturing very at how at excited our low-cost is through And very how of facilities up purchasing manufacturing would Poland. group footprint. opportunities. opened we expanding our

We facility. have Tijuana

of lot So opportunities really how still streamline. a there robust we as about are do think we

I for are facilities to of there Moving income would Poland -- at But the We we the of -- facilities there is services And sort down Asia, go fastest-growing we shared look some expenses, services. have. if aspect they statement, office sure. Costa I the on room in operating say -- at of have all, hard, our transactional of and really scratched look in in back pretty first and we worldwide

and to India an we if standpoint, activities Tech at savings of additional of using to there Center cost have from leveraging often, there, to really our push cost And down type sort just more some there. more transactional we it opportunity opportunities too. a drive look are really Even even R&D so sort

my a to And favorite then up ways couple of drive honestly, margin.

worldwide XXXX. price we growing will priced successful that in in get X% the model then We not of a leverage very lastly, U.S., are to a we that sales way will works, need model And gaining and to it's basis. X%, for And be natural on deliver price. by formula what the our it's lot just continuing work, just and

Robert Marcus

health I of your a If our as business Maybe coming conference care takeaways follow-up. competitors. your to relates some Great. had my it out from

capital healthy the I see that and that the world. less equipment markets stable, robust, if ortho remain you are around markets negative is healthy pricing volumes remain with to wanted agree and So outlook.

always difference other color and You that there's a to geography want have in great you add? if any insights

Jason Beach

across this robbie, board the it's say I said on would there. Jason. take I'll one. commentary the well

very X we those. good aligned as we're across enter think and XXXX all I really well that really with of feel

Operator

Travis will Our from the next question with of Steed America. line Bank come of

Travis Steed

ask about Congrats, Preston. you to M&A. again. kind look to I of the working with forward I wanted

You of have guys list checked kind Inari. those of of used and one off X on things the kind to of

Kevin, down or like period of M&A? going to talk some of And of client be of So continued new in proceeds this areas the help maybe that of some period of prioritized this focus And debt. business a your kind going digestion be kind for about, of M&A. I list will assume is the to a pay is

kind get M&A can you offense So of sooner on back right... the on that's if the

Kevin Lobo

the -- what from say Inari, equity Xx. even still to we with to spine, is I'd Listen, around our debt any Yes. takes even before debt it purchase proceeds

And talked I still that inside excited as necessarily be deals. can And at Peripheral Inari medium-sized, deals we on that be deal. able I've consummate But we're the that the think the are to spaces, and ones large like majority continue do near we'll mentioned to Vascular, still do the as obviously, to that big about, And reminder, term. the are as to tuck-in that other we about continue we in I've talked tuck-in. have necessarily I've don't of X past, and very XX adjacencies urology, a of health deals single that and to And businesses. talked be remain is existing addition all our call the existing Stryker, tuck-ins. looking continue IT. ROIC all talked within I've we as our have that but Every in spaces Inari love business deals. that's acquisitions the we'll I've very last Neuromodulation. year to robotics. years, in for continue the small offense I we for over majority talked most us, businesses, a peripheral they do looking the points. tissue it tuck-ins. were care acquisitions. you the and do them interesting integrated tremendous range we're return of all all about will did occasionally, about And out But we to already saw last So the capacity about Those with soft do. for Those bring also once we into just and is forces space that that follow-on to in because the do sales of

Travis Steed

Great. of normal guess And growth. growth, wanted to above I of on years ask of kind I a of to higher X% of And probably new year kind there, revenue normal X% the guidance another growth. normal it's above X now

And so LIFEPAK this about the going wanted of you to gotten several of of think like and kind sustainability revenue, higher products. pipeline the I

talk about that of the for growth sustainability XXXX. kind the confidence of just the guidance revenue So rate this you've and in gotten

Kevin Lobo

to guidance just the Listen, organic. X% clarify, X% was Thanks. Yes. to

a the higher on it's little low than end, year. was bit so And it last

on bottom risk less the of look, bullish. even feel we feeling the end very we're So range. And

you look on they're robust all constantly of all and they have following If businesses, pipelines our with at innovations.

extremely are offenses commercial Our strong.

smaller of There impacts XX, of and are I and meetings, series portfolio. big January there's but our across at forces launches a has morale that Pangea lot month the been of product big Just are tell our sales kickoff better. a those occurring the in LIFEPAK you with and such never our as the spirit could time launches,

year that durable. by thinks soon. hope We're see knows everyone it would and down year year, now, and it's after And I doing anytime I don't slowing after that so

Operator

Our next come Roman with Sachs. will question David from Goldman

David Roman

maybe here. of follow questions I couple a want just to on strategic up

completed had expected you maybe about on us there? in you thinking last that Can the serve on think just year. you're million to able since you've how commercial that's contribute acquisitions an deals? updates been How progressing? were close have And $XXX this observed I to these you about any strategy you cited that XXXX call, the update give

Kevin Lobo

sure. Yes,

I'm the tell deals. all, extremely I'd about you, excited of First

are acquisitions all the really, but the us. model, actually kind or bit taken above off of of are X the or model, have a All unusual at well. they've below Normally, deal that little X you'd really for

feel sales call million, very frankly, deals of forces, units integrations, specialized In these The And specialized the just that additional in on additional we've every feet simple they points very cases, about $XXX year. the we are tuck actually confident company. into so certainly Vertos, added or company, existing the because something achieving some with existing business some obviously to we've and case some. of of feet the street of street. adding on that people do is we've added we in some And decided came surpassing. the on But sales sales some them add

we've sales easy salespeople, when but tuck business to our you forces into small constantly businesses are of it's it continue parts integration existing number quite to split looking a an an add split of All and territories, or forces, and to sales created forces company of new with... sales across the

David Roman

the just maybe a Shoulder on follow-up then Mako And rollout.

about kind how market And maybe adoption the Maybe to similarly I measured competitor the pace solution a out shoulder years? as addressable market, you shoulder your think robotic of knees, if help here? how in also the of us the is should rollout. good The and some the think your view with coming we a shoulder the next hips described over understand X as dynamics robotic proxy? evolve just could of market X gradual was should in

Kevin Lobo

robot value. is, I'm haptics do. procedure the we're in excited the the procedure case, doing a the in with Listen, bone space. about more preparation difficult tight brings with extremely to And a And our harder Shoulder. very It's robot Mako our

feedback feedback not more. exciting, if is extremely least surgeon -- as in early at knees, the So exciting

we a on. launch later that go require that go so sometimes lot little have at a does can through learned they management, beginning, it new Now of fast slow change you the the to and

the this be year protocols more is And start and training really so beyond. going and we'll well-defined getting really established, see and XXXX in to to acceleration

we of without acquired knees, in And great it but growing of other really seen whole differentiating. 'XX not another with double take very Wright had much will an year you've digits. year But been even this since level. Medical robotic business strong act as Mako. another need you it. know, in have a our be as doesn't shoulder and will our we'll fantastic and the It's impact clearly is XXXX, compelling and that to solution So It's commercially, doing

Operator

with comes Our next of Deutsche from the line Pito Chickering question Bank.

Pito Chickering

for here deal year, the this know with closed again. change But the to On this year? press transaction. the color modeling I seasonality how working think all there's on thanks forward from in with seasonality perspective, transaction divestitures, should the and the no half Glenn, Does around years normal EPS spine the in the we looking you like EPS of a Stryker? the about economics first

Glenn Boehnlein

Honestly, delivering. when first it's pull we really to overall not all, Yes. -- numbers out, material the that of we're spine Pito. Yes, it's

of would will XXXX and And in forward saw to of so generally I margin say seasonality the XXXX that op cadence sales, carry in the you terms expansion EPS.

Pito Chickering

other get in of near what should All Medical we a are the XXXX? time the there think the year? year, for How And drivers right. growth then big medical never growth does as for huge 'XX, divisions. Great. And had this in about sort to

Kevin Lobo

stretchers, whether Sage, across of a underappreciated opportunities growth Vocera, portfolio. series times, the of most the beds, double-digit division company. many tremendous drivers, have in wireless momentum just Medical. number just Yes, across think I've our acute this you year said care, it's it's there's a tremendous emergency of another And should I expect within -- care, growth They it's tremendous

of So years expect double-digit they're double-digit another posting -- XXXX. of top growth growth in year and double-digit on I

Operator

come Kumar will Evercore from of the Vijay Our with ISI. next question line

Vijay Kumar

and think what my the was guess Glenn, guidance you're Spine? saying? you made maximum basis And mean is first given the absorbed current question best, your spine, be congratulations, dilution I is a that guidance impacts spine to comment well wishing XX $XX.XX the will the just EPS of does intact $XX.XX clarification. the points, I that's that Inari Glenn, deserve. Preston, you in and

Glenn Boehnlein

will of maximum in absorbed op the basis $XX.XX. to will to You dilutive heard that we right. gave it EPS Spine expansion. margin our And $XX.XX XX be guidance be points in

Vijay Kumar

question Inari, corporate fairly on of is deal here a margins Kevin, this fine time. good -- close related one Understood. And maybe margin, with that then sort is here? aiding below

Sometimes sales the guys given assumption? assuming But know comfortable? And how Is I'm disruption investigation. that time, should be minimal fairly a we turnaround was were you do there quick some noise that around when fair deals I do here. force get DOJ have announced. a

If helpful. you be could just that comfortable would clarify you on how it got

Kevin Lobo

to going to us. Go answer with he's I'm room the Andy ahead, Andy. here in that since Vijay,

J. Pierce

. And comfortable we your And noted, based timing the the close, to be filings on by end closing in CID. anticipate, we secondarily customary shape the got be and pretty Vijay. that we're of feel there. we of other Sure, The good February, deal then and conditions. going around regulatory pretty to do as question like to around

we that go area was of what gaining you we did course, in with where went see, an deep was And through Of transaction. course, as into the risk the our understanding with CID.

Operator

O'Brien Matthew comes Our Piper line Sandler. from with next the question of

Matthew O'Brien

math my about on the based just contribution thinking But specifically. annual it's $XXX from $XXX Andy million. looks for million, is it of the one about like Inari, this Maybe

in of factoring $XX I think roughly you're lost had the -- that So been sales, million what versus modeling. $XX Street about million,

XX% about that's So growth.

So able cetera? growth it future, business the type to can et Andy, back think this other need of in kind do aspiration, do do get full be you you market. you to technologies in to market of to below Or growth? well that be

Kevin Lobo

me months' Let This only for really XX be clear. worth of is sales.

high assuming We double-digit in this are business. growth

have. very from not growth they far the off So rate

up falloff. only assuming XX it's year, can any And not the it million, year. of Jason, you was follow not $XXX months with for not and million, months the of XX We are $XXX afterwards,

the So There going very we stay with to overlap isn't force think are our business. is engaged. fall We any off. sales assuming not

company. not there's force plug they sing have So have going independent to have -- we and business, This to deals. us business integration way we're not existing had overlap continue just to with we make plan alongside the sales our right that as challenges an this the

Matthew O'Brien

just I'll what about just range, just end even given one higher, the trauma to guide of business? well of unbelievably year, again, versus just And momentum guess of and given, that I that just the and getting even somewhat do you average I'm talked double to the we you these just the looks Medical, range the X%-ish things. of conservative, new would in trying sure or momentum get to in side down it. I X%, above X% specifically, good. the extremities digits you on the midpoint in for all the Got see then, to line math days. know you're top but be, low it. but it's Got early Kevin,

Kevin Lobo

good I it's Listen, feel business. the the early Yes. year. Look, in about really

year, the levels, change. least months, the a activity capital, good for we X, And visibility, so but things full have first not that's procedure levels, X, X at and can

remains obviously, plan, we're if of the in But we're our year have And But everything able end And year, smoothly downside. be is to our risk not that past. strong steadily feel towards to momentum it the moving could hopeful if up guiding. happen goes way the currently deliver will going us every where assume And we'll to potentially to move I'm it or to this that products. I'm to to quarter, guidance don't update be the going continue very we're they the be another continue That upper Those guidance. above guidance. what to So seen. continue I offense. last year. that go up. certainly we our launch we expect on predict playing you continue continue to to And have to saw to going as we're going

Operator

comes with question Singh RBC. Shagun from next Our

Shagun Singh Chadha

question priorities expect Congratulations Glenn Kevin, to on the a we and if was any wondering both And transition. this given should then, I shift for in Preston LRP. just here. you

market weighted growth, points outperformance, to algorithm to Your average algorithm you but XXX has another gets growth X%. basis XXX X% of been

including have those XXXX. as in How levels recent years, you've deals here You some exceeded -- and well. made

about basis you guys how about weighted beyond think XXXX, previously points And said average growth similarly going peak XX least on do then at had how market think So you just annually margins, forward? we that should levels?

Kevin Lobo

Yes. Day this later Thanks, Shagun. We're going to have Analyst year. an

update beyond algorithm that Clearly, kind of into we're And for the future markets. so faster-growing we'll at XXXX. growth the moving years time,

we XXXX. market had faster-growing it increase to We're to operating operating expansion, another So as relates you markets. our that moved we strong terrific margin the end has exposure weighted growth year. a believe planning this We average have as Inari saw up And year Spine, operating beyond is in later dilution in even much the Day. margin we -- why on in rate margin which at at getting is planning think in the I of absorbing the terms level. which to that the the we'll in But of why we're give up not that, acquisition, on Analyst we're way company, for do year power

with it to second as question. Sorry, your

been both it terms there capacity many Preston Chair to your and me of I've IR as CEO change in any shouldn't with to as in in sitting -- parts having you questions. the relates The Orthopaedics and Head Sorry, for priorities. were the the the been expect Spine, with our Finance priorities, of company, in

Operator

Our will Matt from Miksic come next Barclays. with question

Matthew Miksic

maybe product what the been the lot talking last but think as There some conversation don't interest well many to make that a had again of everyone with around to has it's forward launches doing part question know sense working of does I congrats businesses so are said. And of you spent of saw year everyone have a ton this around worth. looking with of Great. spine. who's in and good we one just anybody I that for about. I coming, other it a the out been questions. moving

So camera, management. don't know, even things and instruments like, powered defibrillator, base I

Just start the the of hit you the double of other of could many the kind them into above be that do all follow-up. quick Then product dig give cycle color How going end is, are and would are these kind all question of these through digits. basic -- if of Any kind I one 'XX? have could any maybe punching you sustainability of to carry these to side Or on year? by refresh great.

Kevin Lobo

Matt. Thanks, Yes.

this that DRX have there the I impacted of for on As you the all think we cylinders. clearly of are at a businesses rightly camera case. lot by year firing be lot that's because that a and mentioning whole time, was ago say, not a the would speculation I we really thanks

There's of comes grow. Looking we launches to you the to for plenty the start Peter tremendous business just is of way room on at the it start do the performance scene. before our see to our new companies product in cameras. both The as

we're investing R&D. locked The still healthy And have so we rates still -- all that loaded. and pipelines in are

to those So that. and XXXX, before we launch see restock really to of in the slowdown will you in you able any shouldn't expect be businesses any products material and funnel start

in last X you the X, sometimes. X we'll product goes gap of years, the back in And X, XX. System as terms a before In noticed, another bit you've of the of have in sort that growth, System a starts flag year, its System of have Stryker, X, you go to to old to go would days if gap growth. lower XX you But years,

R&D that. up insulate have able to to We against the be products teed

about the good and about outlook 'XX. year, And future. very the later we'll I'm Day So in in talk then an feeling again, we'll have Analyst the

Matthew Miksic

a there's fair catalyst there I and out follow-up as and your enabling Could competitors on of robot know is not focus is just give implants you technology. us the Shoulder. on here important the a then being And just right? I quick one the Great. of the amount other sense an robot, a mean wrong.

with I If been growth the of as how give the what for know, sense growth And in you don't XX next robot has or see contributing you a enabling that's uptake contributing us technology could Shoulder other to day, like adoption month? a weeks there? solutions maybe to the besides

Kevin Lobo

implants of our and Blueprint stemless, be we type all, AI guidance actually with And incredible perform market-leading funeral absolutely of system, been surgeon software should ecosystem with anatomic, it's first an short that stem, implemented. reverse, with the surgical is integrated have plan which and software And Well, BluePrint implant the robot. modern has to like Yes. terrific implants, provides totally and outstanding. the which Blueprint

So using the Mako. to the same surgeons plan procedure software on used be using will their software to that the they're same

which Stryker, under and has now for for system the market to under we progress Medical Tornier that years ride continue And leading have -- it's forward. Mako so the and And that growth formula like been added start is about off our is robot we've And procedure. but initially, to out X/X reverse, been benefit, and needed just of the is going the come with the it hasn't robot.

other it. move So eventually, then application, we procedure. robots with hips we And and a procedures are to we about all Mako parts reversed. far, We'll Academy. shoulder by that, are feedback to saw at And equal. as not surgeon of the be you'll But start knees, our the hear most it love and showing

really actually going navigate of get If it. powerful. it's again, SAR to compelling. software, But part expand of shoulder. chance an the shoulder and It's it's think fantastic, the your not you the glenoid. implants Blueprint don't to just mention this. to we time. a Glenoid ID, have was It see have shoulder. you're patient some market-leading very that which to really put that if augments anatomy. as business match which we is they And needs the doesn't Because not high in the the have be trickiest even solution, you'll -- that AOS, are and save to personalized plan custom is system surgeons to starting We at shoulder which a growth as absolutely find already best-in-class with And

'XX, can will product other this. pretty a launches So longer mixed play looking And term, that have sort into of imagine But that of at that's are we exciting. series I that 'XX beyond. -- there's reality and

Operator

question Company, come will Needham next Matson with Our from Inc. & Mike

Michael Matson

one So spine the really still to revenue it when similar the and enabling their end. know they to ask there competitors technologies the to same work be work? here your wanted in with and the didn't something seem opportunity the type just of business, from Mako Is spun out will sort I how buying of try Mako robot? divestiture, spine about of

Kevin Lobo

because done strong will going robot part obviously That Spine are similar spine Eximiuspine now the and served gone Mako is implants be it's brand be of business. Yes. Listen, who initial salespeople. the we've our will surgeons is be the compelling well. to cases Mako The using have and the by extremely very

using and join same be to of they've won't there business. team rep just same room out the and Spine surgeons obviously other the will in attract try lot change And a So in using Mako the will today. to be VB implant the go the then respect. It that been operating

operated and in business. So different plastic Mako had Mako implant capital providing We already our then X worlds. we specialists and we salespeople had the

being that now -- it's spine. instead Stryker's problem, VB So it's of

really big it's for So not the customer a difference.

We a work third have do more because a it's party. bit to little

versus bit which be to focus have having VB a have a XX, goal to frank, done we it. more to tough And to contract great past on we a innovation other a the a we investing we we're So business time. a in to doing have going is in not expecting Whereas be deal competitive I when going to contracts, big we're areas business, really have. market, what be we for of which, I'm not a difference the the party. They management know years. investment business. together of with very What it laser-focused be this third know that us, put on they're But think not change It's implant Brothers with implants and long well. XX all does of on. lot this the been They've over the

alongside. an to They're in be few Spine going see a to and weapons So and isn't we do it -- then they term, but beyond of and we we becomes short this whether that Mako not do really least, it exclusive we we thought going terms the to And be stays with at least exclusive I'm first system. with whether that the stays hoping partner. the really, more it revenue impact. what that customer But -- much -- could we'll or different well, of for in do the years, at that, exclusive do it's open much

Michael Matson

plant mean in and that Canada. And talk on then a -- Mexico know just potential terms Got Mexico. There's of tariffs Okay. you of got it. you've I in

move do of And production this tariffs X end countries? flexibility manufacturing of do up much there some to elsewhere seeing have is So your we weekend? how much coming how from if you those either

Glenn Boehnlein

Yes. question. Yes, good a it's

all, here. keep you got in mind the I just scale of think, first to

have We some of plants manufacturing does XX assembly have in roughly and our Mexico. It X products. world, around the of we

customers. we potential looking We're really or to It's the now, follow-on be early at following and even that of to little closely. this the the what to So a maybe evaluate impact discussions. us are right might the possibility impact

from watching that mind, excluded of So certain right way I most we're X be develops. this like sort we're which companies keep and tariffs, say may of level companies, level it's especially seeing of now, some a plant would XX. at in But out medical

Operator

from come with Caitlin line will question Genuity. next of Canaccord Cronin Our the

Caitlin Cronin

just solution, on the Mako and off, just spine increased shoulder, to you quarter the and touched these as a interest great launches excitement you have having with I Congrats in on any guess Preston momentum from hospitals kind of and shop before? new to start seen congrats as SC Glenn of and well. one-stop for Mako

Kevin Lobo

and a and of We're get bit brand strong because sure of a knees we we're to success limit our stay protocols on out make of limited with all ASC we're on It's -- a gaining going kind not brand, actively to number our done. training sites these, it. we're is excitement. of Mako is shoulder, There certainly certainly hips. promoting right? in just Yes. in The -- both early experience -- launch not actively we're still, and

it's early that And shoulder, will Spine future a there's less quickly the move I days than about would update more you quarters still. in we involved so as say the I for it, proceed. We'll bit launches management tuned. do asked stay expect but change little surgeon.

a launch. that move to will So quicker

able more be tell we'll QX. spine of probably end to you at So probably about the

Caitlin Cronin

then Got just number. a strong extremities it. And

How Foot far that environment any & You into the And in business commentary. Ankle market on really did going XXXX? into QX? didn't the mention commentary

Kevin Lobo

Yes.

the created overall, market around It the business better But extremities, did around of for an business did and halo shoulder Core really to our XXXX. have unbelievable Pangea, powered sales and had it year, soft. of but kind our by was year was improve. was the Foot just was amazing the just very quarter real terrific trauma up I fourth trauma business that fourth again. trauma extremities of business. And the Pangea, not couple quarters start entire first has expect execution for business, You force an certainly recall Pangea story exceptional & around in market impact our the Ankle and September it trauma. a and picking quarter in core quarter and partly a

Operator

Our next Newitter question Truist of comes line from Richard the with Securities.

Richard Newitter

Congrats, Preston and luck, Glenn. good

earlier. asked the into environment great have Just hospital going you at back insight I'm the I think level. C-suite just to question, guys CapEx conversations obviously someone curious

curious, emerging Just potential starting on? any your are But of customers. you with be care policy maybe anxiety? in there with brewing customers, out are to about just are potential see fiscal health the there some changes rhetoric years the are coming, of and the all uncertainty how changes must some going at on your that budget. XXXX behavior expressing that going Or if all, any I'm

Jason Beach

call, reason and XXXX be environment, don't any frankly, throughout here have as to to Rich, any go would it's of us, we coming similar at we as this the feel year, in good for this what to Jason. about ended won't capital what we we positive the speculate believe policy different the point. the future. on I and I any early which days at very in is potentially certainly. I as kind earlier look XXXX, on is, try But it'd said environment say And

Richard Newitter

in the like a company very the the you more but the any and fast? financials pretty think in guys was like much so on right? that? all access end give December. quick the how looked Okay. you process. had Inari diligence -- turnaround feels market I one to got done to that like can looked guess, It whatnot had right, to prior and this proxy, it got on one, with how read to encouraging I comfortable That's We it work early reading that color hear. and I is -- And And been I you just diligence, Or it maybe access to the

Kevin Lobo

that a typical company. a this. the we That start Yes. diligence Listen, homework, it's publicly you companies. traded publicly available, traded of have had a very prior frankly, There's was information due lot done is of period publicly our for and to

Vascular As many, times. mentioned Peripheral you many know, I've

public. got of look for to that And So due diligence, we into look, our to including were our good look on homework all and and in things done absolutely prepared about R&D when sent go then to with we everything at and go we we chance a team exactly where knew there. what we and very line saw what the felt and the

So this we deal, we public comfortable feel is a and of due atypical not we amount for really feel moving diligence, a like had sufficient forward. company

Operator

Our line next of with question the Josh Cowen. from Jennings comes TD

Joshua Jennings

is just on build-out and tailwind positioned. I the the the Glenn Stryker in was it's U.S., touch Kevin, of to ASC hoping been Preston. Congrats infrastructure kind to best a of continued

but ASCs to of levered in businesses I increases are boost, year-over-year continuing think number the think this most of many about procedure in biggest increase your the U.S. the being as volume of

long U.S.? one, the because are think how to but answer, that long is buildout expect business can this you there help And two, it's are think guess lot, last? this is us ASC do I So you inning And in this to really in, the just from tailwind? we in which a infrastructure are benefiting too what I maybe question about

Kevin Lobo

I exciting Stryker. still Yes. very early think it's us at Listen, and for in we're innings,

businesses this our we really least which in and more, many construction that and X and we ASC. new So especially of involve most trend builds sometimes have the is and I deals at units renovations, And that do, love play big business the because of exciting. they

involves the is involve you our customized. and instruments, a orthopedic businesses lights, sports of Ankle. it you obviously, always have sometimes and that Foot So communications, but medicine, knees, so It suite automatically think stretchers, can it there's about and booms involves everyone hips & also ones are

to then they and ASC every procedures you varies around potentially that varies. types hips you have also and of unique RRs, on. have number do procedures have and you you deal that interventional of the the always other and because knees is So normally, have on and choose spine of sports, But

knees if the both So and knees we biggest the X you E&T. hit XX% gating And our a of think sort just But the are that's in it's market. after of the were in take and of occurred the quarter ASC but quarter, we in even it, ASCs, the is say hips. of Knees, of ASC new years. think love just U.S. knees In and hips moving, And of been, time. construction steady as there increase. I'll I factor which I'd a not hips climb the just kind done fourth steady things quarter, it's for high were XX% is, a that's about way our sort only what like last will or this change call X inflecting,

to The in I because linear not bring trajectory. is current inflect continue just don't quantities. So easy it's on see -- this curve capacity just large, think the its on of going is kind something going that of kind to to large I of changing stream large, ramp isn't

think don't surgeons experience. great see and The So it. to contracting going will people and to And people And go go because getting to sight be love in to they're health these continuation. hospitals to I end places be don't it sick have -- ASC. I procedures when just a an illnesses going patients and of get a should a and have or are risk there, healthy people

will slowing time. So see this be gradual it down, I but over don't progression

Joshua Jennings

now segments, follow-up peripheral kind weighted opening in in vascular high-growth market other rate this the vascular. you're the Stryker? as there of average many door answer higher on and high-growth just Inari, initial strategy we cardiovascular post that a the kind acquisition consider Appreciate cardiovascular of Should that. And to getting into breast peripheral growth then for sectors are well the to

Kevin Lobo

question. for peripheral this, least and to At look the the we'll initially, Thanks Yes. probably add let's within integrate space.

into of the in that, see that expect a I term, jump kind we'll cardiovascular. term, we'll, but make don't longer near Beyond

think this points right build now. And frankly, we're Vascular within them lot to in around There's room get integrated I here, we call that get those for to even these our and play. emerging homework have a more Peripheral to a to of feed across on those and other of exciting. be fire to that up really are We business those of A able lot to realize also technologies want Stryker. sort deals. we have are businesses. And mouths lot spinning

And to think the going to this for rest year. those attention least of we're pay so I at

Operator

Antalffy line UBS. question next from with the Our of Danielle come will

Danielle Antalffy

to you you, Preston, really And again. forward with Glenn, congrats working enjoy retirement. looking

goalpost there. high on from price growth level ensure continue this least benefit there, seeing at But get be cycle pretty you're there. steady mean pricing I plays based R&D do Just how focus it XXXX. just XXXX guys this you of a and all, very saw level you -- we changing of cadence given healthy at you about is and for mean to has a have what productivity launches? some forward? new modest appreciate mean, spend what I new growth of sustain super at if and think question in on on to how an helps and front. product the and the R&D going the into a in I I products R&D some R&D you might a really also perspective productivity

Glenn Boehnlein

lining that about products doing are us honestly, It Yes. of And And new Thanks, to talk a Danielle. enhancements. on for amazing R&D. thanks chance the up and gives R&D. and in question launches feature our pipelines your product job teams

as on Stryker, investing very so X% of And R&D. honestly, a to is go way. sort as of in a take -- don't synergies our that rough number to engine great between we fold be We X% very feel It and terms of that innovation our high process. down giant teams sales planning make backing on strategic innovation we're there'll target of receives like we anywhere our plan on through from in sure priority generally We're excited of into or have engine engine those in budgeting which and a our neurovascular with business Inari that to any the and innovation current there.

spend changing prioritize there. the don't kind I honestly, terms in just that of see we really of strategy So

we're But looking at that's where X% centers to or we doing I the up to or in we're drive efficiencies be X% programming do look better those excellence the any think to software around probably things. or you'll where us I see -- where think honestly, I might think of range, stay. building continue R&D of AI

Operator

Wolfe comes Polark Our of line from final question Research. the with Michael

Michael Polark

I revenue relates organic guidance, as to on one Spine. growth just have final the it the follow-up guidance the

clear, kind XH So doing you're which closed, Spine, X% has it's the includes full company be very that the XXX assuming XXX full of to is basis I want of points guided saying, just X% for math, to the to year impact.

the I if [indiscernible] guidance X of as for 'XX? So revenue plus at real organic RemainCo is look X.X%, growth kind

Kevin Lobo

overall something pretty Yes. on we'll us do organic, having can some And a get Spine get Jason in next day a you is that we offline. X% to X% that. the is with this not to the follow growing headwind going benefit, rate. because give we're we're to But Michael, it's up I up than is year going X less impact off-line by think slight maybe probably Stryker the will Spine with small, can to benefit Despite lower But this you follow Jason at -- when year. that on similar divested business.

less kind X those So of or more offset.

guide, massive X% a to you is benefit can a pretty us X% its size. spine good the healthy that. Jason give this just with and up on off-line So But pretty follow guide, doesn't given again,

Operator

There the I'll questions. Kevin over for call turn further now no remarks. closing are to Lobo

Kevin Lobo

also I for a Thank Glenn for X talent We're finance the organization. Preston, a and you to call. for entire great years finance. joining pipeline obviously want once all building thank great of but and again our

And succeed. people organizations. with you. all results line We've, sharing QX behind terrific May. have commercial our help time, Thank Stryker early we strong over We them over our look built at as and business support to businesses that functions we company our the our extremely up to in just in you forward do

Stryker (SYK) 28 Jan 252024 Q4 Earnings call transcript