BSX - Earnings call transcript Q2 2021 | Boston Scientific Corporation

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Operator

Good morning, and welcome to the Boston Scientific Second Quarter 2021 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Lauren Tengler, Vice President, Investor Relations. Please go ahead.

Lauren Tengler

Andrew. you, Thank and everyone, joining us. Good thanks morning, for Mike me Executive Chief and today’s Vice are on call Mahoney, Executive and Financial Chairman Chief With President Officer. Officer; Dan Brennan, press of non-GAAP used our a We morning, release. measures earlier which reconciliations results, in announcing issued included QX release 'XX the this

Filings. business, We heading of in focus duration well to today’s hour. The reconciliations have the of Financials QX as more our the will of full Investor one to year QX then as a year including release copy COVID section XXXX website and his review performance call 'XX the under procedural key non-GAAP 'XX as & guidance. posted 'XX Relations call Dan approximately this that and your as measures future on impact of compared financials comments provide an used questions. well largely and be and quarter, will will for the Mike from QX full guidance, our take QX and catalysts the details and included for our regarding we'll outlook

Stein. today's session, During will Medical Ken Officers, and be Dr. Q&A Ian Dan Dr. and our by Meredith joined Mike Chief

XXXX XXXX, XXXX which mid-August and second of and microspheres a Franchise, closed Preventice, Vertiflex Specialty closed Pharmaceuticals, on which and versus call mid-August the to global and period in comparable X, Before closed to full and QX antitrust are less half of than to including everyone include Farapulse XXXX we XXXX, quarter and May customary divested growth for March acquisitions in net closing that of Surgical is in recently were Relevant there further Intrauterine divestures which the which which revenue Health remind XXXX, expected Medicine, expected respectively. XXXX, begin, respectively. excludes announced excludes and is excludes to operational the which organic growth close foreign which the sales. Interventional the and Guidance BTG on March Divestures include I'd conditions, growth organic acquisition the revenue fluctuation, like Lumenis portfolio close impact and second XXXX, X, clearances. acquisition currency acquisitions and in for were which BTG XXXX of subject embolic

For unless our highlights X more Investor to which information, please Slide to our this of references otherwise and refer organic. On are call, website. found specified be and financial all revenue, on Relations sales operating may deck,

which update disclaim believe, impacted X% and note, within our to financial of section I'll over include use; upon including it point, Finally, which the contains tax impact obligation our of as most XX-Qs may X%, date, like to speak earnings; laws, recent These results; company's those today's or Factors XX-K for savings them. and other ex cause pandemic in by his only our well cost represent any words are the statements financial not by acquisitions; things, as this identified performance, the growth and intention and securities At that filed share; we as product expenses. differences Risk periods, spend expected COVID-XX anticipate, comments. operations with described subsequent COVID, cash R&D estimate flow margins of our growth materially may, in COVID-XX They sales, opportunities; similar other SEC. Mike and and Factors Mike? such and approvals pandemic. the between new other federal meaning of goals growth forward-looking of the and among results about to statements clinical trials; our be Of the include, expect, statements time market turn comparisons and words. rates, launches; the may call this and

Michael Mahoney

everyone joining in pleased in strong to you of U.S but to the financial report strengthened many, resumption today and Lauren, us thank globe. not elective QX as certainly procedures Thanks, very today. the the regions, across improved results I’m and all

of operational execute Total by the and our as second globalization particularly company X% second pandemic expectations sales than our XXXX expected, we beyond strategy, We expansion XX% more growth grew Organic XXXX, quarter continue recovery driven XXXX in efforts sales U.S. to versus enhanced grew leadership versus occurred are from digital well-positioned exceeding category innovative faster the versus into quickly and XXXX. and capabilities. XX% the for half markets, pipeline, as

our their estimate our Importantly, We units units markets. of out than X grew organically of business faster XXXX. versus that respective X X business digits grew double

with with and of adjusted was versus of XX.X% to EPS guidance launches XXXX, ahead to the XXX% high-end recovery. QX due pre-COVID primarily spend. $X.XX We margin enrolling of our the at slightly and our rates. now outperformance are lower investment Adjusted by clinical XXXX sales product expectations as are pleased grew versus we sales exceeding X% run and continued ongoing our $X.XX operating we balance and trials new of

be to continue cash free our We pleased flow. with

generation million free flow free of quarter cash and $XXX Second $XXX adjusted flow of cash million.

XX% half we our growth to level we revenue are to guidance sales growth X%. are we this Given full full a year 'XX, ranges targeting both of assumes year increasing EPS, XX% and the year. to quarter and compared COVID X% second quarter for Compared the in for manageable impact narrowing the of third of quarter of which XXXX, XX%. and organic growth X% revenue targeting second third are to to 'XX And of 'XX X% and XX% to organic outperformance,

sales range full $X.XX to EPS updating $X.XX. adjusted provide EPS to are both revised 'XX performance to of EPS will $X.XX, including revenue Our Dan details and more third outlook, Preventice. on a adjusted contribution $X.XX year and we from is and estimate quarter the

on the comments our expect with highlights quarter and I’ll to third for on 'XX 'XX third quarter results, provide outlook. half We now for close Surgical. and a close quarter Lumenis 'XX continue Farapulse second along additional second

the ACURATE East/Africa U.S. grew Europe/Middle versus the as XX%, Within the grew U.S. XXXX X%, quarter regions, X%, grew in versus XX% Asia-Pac versus XX%. lockdowns Endo strength digit PI, and China approximately POLARx, grew Alpha sales Emerging and with than such quarter procedural on double grew strength grew faster region Africa. TheraSphere, anticipated Asia-Pac, even X Markets second and in second XXX by by and an impact -- WaveWriter operational and an based U.S., IP some tender 'XX, franchises, of volume basis our broad NeoX, products Organically Operationally, delays. with procedure EMEA ongoing and with with also had levels, along in growth points quarter major new launches. digits, nearly across businesses XXXX, the excellent markets sorry, experienced growth of The COVID-related Korea. in supported EMEA although notable growth pricing included of as China, results East strong and negative double basis second from EP, Axios countries Middle delivered In PI, as the Australia, was all neuromod, recovery

Japan’s negative of by impacted XXXX, within seeing and Interventional Ranger second ongoing saw such included Cardiology, While we with the the impact were growth all exception new double-digit business versus Watchman sales as we launches COVID, results quarter units, grew DCB, product success FLX. tender and XX% pricing. are of which China STABLEPOINT,

enabled tender win. Complex growth with our by our be strong Imaging, We continue pleased and PCI our in both by innovative to and portfolio

to acquisition, versus on provide to across 'XX both We expect is digits, from which in growing by driven which expansion category-leading benefits Pelvic by and Within businesses. growth further durability Stone, undergoing full largest continues comments U.S., franchises. treatment Stone, global Prostate recent the SpaceOAR and this patients with strength and U.S. some digits, I’ll Health laser Health units. Uro for radiation were Health in prostate portfolio growth technology. expand Starting SpaceOAR negates appreciation and important double next our double-digit step in under will growth for for now The Prostate in XXXX Europe. the an physicians Pelvic launch continued continue and efforts our MRI, the China invasive is Rezum optimizing SpaceOAR generation XX% business, launch SpaceOAR enthusiasm its as grew versus 'XX. minimally the Health, very Rezum was this and double CT its the and now therapy. use ongoing need our is of Vue 'XX, strong hydrogel therapy. with of long-term Urology Vue direct-to-patient grew of planning the business continued Lumenis visible sales cost and to traction with of strong, year supported the franchise which with franchise differentiated was organically balanced ahead

key products delivered and Resolution strength thanks XX% growing sales with as double QX hemostasis Spyglass, in all Prevention, Axios, major excellent XXXX. Our team Hemostasis across Endoscopy portfolio sales second versus our to including quarter clips. Infection grew franchises with notable an digits Biliary, and such organically

for early visualization Mark pleased the launch the B Within launch CE quarter, and in 'XX. track on and suction EXALT of to remain second and completed in are the feedback U.S half differentiated we highlighting with

slightly to quarter market to as normal We believe sales performance recent that Management, EMBLEM from 'XX. temporary a versus overall was access second of development In as launched market, well Rhythm resumption were progress with a S-ICD X% CRM below Cardiac impact as continue training of with physician organically program in our EXALT physician inclusive advisories. peer make We hospitals down more D, the activities the improves. the

in S-ICD perform electrode the improved our continues performance half, and implantable gain as S-ICD began to monitor we cardiac overall recently enhanced U.S. the Importantly, Lux-Dx revenues second our share well we and rebound. market in CRM in launching expect anticipate diagnostics franchise, In our to

up execution are US approval year least will were lag until and anticipate We forma growth sales and XX% POLARx driven the which that IDE were team therapies, growth of these sales in versus in XXXX. and growth are by U.S. respective sales catheter enrolling versus market in of Europe XX% the success strong Japan. for trials. 'XX. on Preventice we and receive at to of business a STABLEPOINT basis pro Electrophysiology EP in currently their pleased ongoing international growth the XX% of Europe Force-Sensing also with Strong continue full likely

is to ablation, is the and enrolling a ablation use exercised is is which Europe pulsed only Farapulse to cardiac company actively an has ablation its potential for approved Farapulse, IDE, with efficiency, which ease of in and field acquire the U.S product trial. ADVENT also pulse We commercially a in improve emerging leader procedures. that our field option safety,

'XX. Neuromodulation, therapy We are 'XX. organic portfolio XX% excited third our grew EP versus differentiated revenue this in bring into to quarter In

XX% in launch responder released our second the COMBO rate. Management at meeting, accelerated solutions X-year At study the Pain gen System digital Cognita and next mid-year WaveWriter we functional NANS generation. clinical and SCS of by with growth demonstrating evidence the for high level ongoing a continued data Our clinical quarter, franchise supported our follow-up Alpha of sustained, success

the is We have on designed FAST provide the profound to and also reporting therapy, started relief. which results real-world pain of immediate

U.S., platform, expansion the Vercise non-surgical for Brainlab. the advancing infrastructure, of WATCHMAN Genus franchises. which we the primarily Interventional some Study, SOLIS XXXX Valves, our our focusing this increasing existing which first with population, Beyond in by and outcomes back started XX% pleased our solutions, in progress quarter and also Heart with the Europe. impressive of year was the growth In is launch hospital of gains grew on are the of WATCHMAN neuropathy Complex of to the Brain partnership beginning globally clinical and forward by gain sales year. with in PCI our the delivered double-digit driven look continues sequentially. and end and growth, In the Cardiology, commercial to growth growth by The versus franchise share physician share of Deep study Structural driven and rates strong diabetic utilization accelerated peripheral The business organic in double-digit the Imaging Stimulation,

accounts Importantly, are from WATCHMAN have nearly exclusively. all using U.S fully and X.X transitioned FLX now

declined WATCHMAN pandemic. comparing our outlook pleased expansion, TVT, we’re in cardiac toward a X-year for the to ablation our global effectiveness continued schedule, met non-valvular with were Registry, the implantation by also contemporary as a PINNACLE part ongoing device, outcomes undergo PCR at in Euro first-line ACURATE with that neoX in to and of supported patients franchise is the outcomes presented spite to-date protection with enrollment China remain FLX permanent ahead work about oral excited and quarterly of the pacemaker cerebral pressure. launch we at comparable These trial, our impact anticoagulants by to NeoX as Stents, highest globally randomized include the next low which of endpoint. data its recently neoX digits our tenders PROTECTED at price reinforced also FLX, late-breaker. therapies afib and expansion week account positive Early Europe TAVI new clinical versus generation in who the ACURATE openings sales achieved demonstrate for TAVR with real-world continued well X-year continue do FLX completed PVL TVT late-breaker reiterated Drug-Eluting in device, trials. the to attributable the rate Notably clinical TAVR, trial. mid-single the In with indication We featured strong embolic the Sentinel, its procedure, continues enroll challenges Coronary primary secondary presented and XXXX, rates. devices, Additionally, low of a to which results which last OPTION with WATCHMAN presented global

Imaging, strength see Complex PCI We with and IVUS. strong growth in and RotaPro to continue particular in

business imaging now XX% and our larger DES. than is PCI complex global our Importantly,

a study in which achieved quarter the basis first U.S. over along vein Arterial, pro up coronary on second approval. portfolio in market. Interventional TheraSphere Drug-eluting instent XXXX quarter delivered second Venous, sales enrollment In expansion is trial, by and sector’s the Within within record its to 'XX. quarter for the restenosis. our forma grow digits advancing in quarter, DCB Peripheral Varithena supported Within double organic We’re first sales and drivers versus versus share continuing opportunities varicose XX% grew AGENT post XX% the gain continues began PMA a our recovery. the in with of in future global Interventions Oncology, growth full

on previously patients or clinical underrepresented that of Ranger on on on The DCB. DES of a pleased with registry, list at study of risk to Scientific’s Place outcomes our Families Healthy Inclusion” I’d for recent in work Boston enrollment Top along look Supporting treated the Index. Equality also are long-term Eluvia Elegance Communities like to highlight will populations. Disability to recognition We with PAD being gather also Companies Disability a started patient have the the inclusion study will XXX and “Best JUST Capital the evidence as

be an pleased practices. for Day sharing to with are for strategic plan bullish recognized like look Investor sustainable big remain spirit. are September performance supportive We the at outlook half turn and their contributions Boston forward . our our you and employees environment proud winning we over and first on to of year Scientific. I’ll inclusive we We remain global extend the to this employees long-range for committed to our objectives our to providing Overall, and the I’d our on a event XXnd thank Hybrid to call Dan. through

Daniel Brennan

Thanks, Mike.

above gross and by sales second health divested margin earnings XXX% reported revenue Adjusted representing acquisition million Vertiflex, embolic XXXX, which $X.XX. and range and versus acquired of in months well million consolidated quarter XXXX quarter of a intrauterine share growth for higher Second revenue Preventice. X% operational of line sales businesses. XX.X% $X.XXX quarter. billion Medicines XXXX exchange. BTG Interventional full represents basis an of businesses, expectations $XX slightly Sales was points, growth outperformance the revenue growth as contributed growth the as X.X% growth Compared of beads tailwind of foreign X% in XXXX excludes in XXXX, of growth, $X.XX businesses, growth XX.X% the the divestiture quarter an guidance and from organic by Preventice basis, XX% in reflects to our XX.X%, of $X.XX, $XXX offset guidance from This adjusted second On than quarter XXXX, above and our above in sales of of was XX% X.X%, our versus QX range X%. exceeding consists organic of driven range Pharmaceuticals, revenue versus Specialty to drove margin growth million XXXX. more of resulting results to Top was per guidance second versus XX.X% $XX our X the quarter XXX to

first unique variances items expected, not was known to this to measures, margin us, increase the remain, to result as margin some some for running our legal our we additional we slightly capitalized still of GAAP to full through XXXX all as cardiovascular investment, other half, the levels additionally operating by of year freight technology. a slight impact or balance worked direct for legal plants COVID expectations quarter and selective legal the cost above includes particular, litigation-related and will have as wage reserve claims half adjusted on inflation the corresponding price remain materially XX.X%, Materially account sheet our inflation. compared fees headwinds as and costs, settled newly outperformance as in the of driven manufacturing a well from in quarter balanced expenses for with and Second access gross though also Not in in pressure U.S. as some in As negative increased resolve a lingering XXXX, on include includes to improvements improve expect that expect reserve. driven at like well materials within COVID-specific costs the settlement. stages claims sales charges markets and million claims, estimable incremental within $XXX final settlement second

Our full given XXXX claim activity and in on litigation. reserve based expected global assumptions now resolution are recent

as total by as attorneys increase was million and Our the of close payments legal cardiovascular mesh mesh to $XXX reserve $XXX product state March XX, June payments. settlement, increase substantially of versus all well XX, reserve an by offset as general partially driven the mesh of continuing settlement million liability

adjusted line $XXX below-the-line, and interest in with to totaled other expectations. expense million Moving

capital flow flow was with on and with expenditures. Adjusted million, basis, for line was from $XXX cash expectations. free million tax rate also adjusted net less million free Our operating XX.X% cash $XXX quarter for $XXX an was $XXX the second in quarter million activities the

and free approximately increased billion, the of year. capital in remains to $X.X with working inventory remainder we to receivable as continue during goal expect XXXX, headwinds Our the in flow accounts cash line deliver adjusted

had As $X.X on June XX, of of billion. XXXX, we hand cash

acquisition Our half Lumenis the QX. top the we to capital second expect M&A to deployment Surgical priority for and Farapulse the of and continue close in in remains tuck-in of year,

have share diluted with walk repurchase. portfolio XXXX. We QX continuing full We active to capacity capital ended now and with while our opportunities additional shares guidance venture for through I’ll X.XXX to remain opportunistic pursue development year weighted-average outstanding. and consider fully QX business billion

point divestiture be year, Pharmaceuticals, approximate the acquisition XX.X% operational headwind XX.X% growth For Preventice. the Health a versus franchise from full Specialty includes XXXX the partially by offset XX of to and expect an which XXXX, Intrauterine to range basis of revenue we in of our net

Excluding divestitures, be in the organic impact revenue and XX% to versus X% range of acquisitions expect growth XXXX, XX% and to of we versus to XXXX. X% the

For sales as comparison to million in full $XX through of and XXXX of Pharmaceutical well Vertiflex sales $XXX organic health $XX from at Specialty exclude as through and the guidance, and May, as sales embolic in Medicines midpoint exclude franchise, $XX XXXX, of our million year prior sales; of BTG as mid-August, beads approximately sales portfolio XXXX the acquisitions, intrauterine million million to well recent Preventice Pharmaceutical Specialty divestiture. Interventional including in as March, sales

growth acquisition For revenue be headwind QX partially to the the XX% a XX% Specialty approximate basis which point of net operational of Preventice. from of range by to includes we XXX in offset divestiture expect XXXX, Pharmaceuticals, an XXXX, versus

QX level revenue growth includes point sequential QX the XXXX. acquisitions in versus of to X% COVID and range XXX manageable be continued QX guidance we Therefore, assumes comp Excluding expect to the of a XX% of XXXX, to growth which with midpoint with and XX% headwind to a X% of from impact a impact. basis XXXX, line results versus divestitures, in organic

midpoint BTG and of $XXX from XXXX, sales approximately franchise portfolio, embolic at in to mid-August comparison organic Medicines sales exclude and exclude million sales XXXX the million $XX Pharmaceuticals; QX of the of guidance, sales acquisitions through beads Interventional Specialty and Preventice. in XXXX the our Health Intrauterine For

the XXXX while for below expense target adjusted half what of near-term For XXXX, remained more XX% of would first to rate. expect a we to operating simultaneously operating continue an the in margin, we average levels half back normalized investing run as of

and continue our be XXXX to our to approximately XX% be forecast all-in full tax tax rate approximately XX%. to year We operational rate

for adjusted below-the-line to associated expect which $XXX be year. our interest to include dilution the our payments, from to costs continue million Capital expenses, portfolio, million We hedging program, with approximately Venture $XXX

QX count expect diluted year full share X.XXX We of X.XXX for weighted-average XXXX. fully billion and approximately billion XXXX for

We and $X.XX, includes are guidance which from of additional QX EPS uncertainty sales our wider XXXX our a raising results, guidance update to previously range. which adjusted full to year to considers range removed $X.XX

to For the of be results. investor Lauren, Financial adjusted Highlights, XXXX earnings very to range Relations. Congratulations detailed the $X.XX in QX our that, With $X.XX. relations and to third President turn moderate newly Investor more quarter, outlines Operational I’ll it Lauren, our per website is Ms. to expected which a for check appointed Please QX deserved well Vice back of Q&A. share

Lauren Tengler

as open Thank to up questions as possible, In you, go XX the related follow us up. to Dan. for Andrew, and Andrew, or questions yourself one ahead. minutes next enable let's so. order many take question it limit for one to please please

Operator

of America. The first Bob of Bank question Instructions] ahead. from [Operator go Hopkins Please comes

Bob Hopkins

Great good hear Can me okay? morning. you and

Michael Mahoney

Good Yes. Bob. morning,

Daniel Brennan

fine, We morning. hear Bob. you Good

Bob Hopkins

the on That's quarter congrats Lauren. to and strong

and So, about for more first you just your could talk question little XXXX is, wondering assumptions. bit half a if back Dan Mike

wondering understand a seeing what that stay you from help assume mentioned of get you assume today? means. that do that things mean what level us COVID. the Does things manageable that you You little if specifically I'm assume about worse Or could a you're you same?

Daniel Brennan

lot it has the do I Bob, and you you the numbers, right? our at XXXX. from a comps, quarter-by-quarter, of they're think at XXXX with if look If think I comps to look

in in And we a QX a X effectively so XXXX. versus X up put

If you look for QX, to X% at X%. guidance our it's

which a harder. of basis the X, which is X So against take is points XXX the X, at the midpoint comp that's

up whole theory, you range. of which go is what a So comps, the in the effectively but in kind I X X And did QX. we when becomes through QX for a implied ends in adjust won't similar process, the

impact I of hearing was the COVID that So say that, is manageable. QX, think what I you're

is in for very the would comments the Mike's guidance was that part continues half. heard in You recovery what And particularly most U.S. back imply the the strong, our that

impact you So in quarter QX. a similar saw be manageable would COVID to what

Bob Hopkins

Okay.

like -- sounds ahead, sorry, So you it go think Mike.

Michael Mahoney

did and sense you? that No, for track make

Bob Hopkins

Yes, They same. you worse that things are is like just from which it don't sounds the you're basically what get assuming said stay …

Michael Mahoney

Correct. That’s right.

Bob Hopkins

then follow-up a so if in quick quarter. really you I talk sound WATCHMAN a a you think It trends But experience Just more be maybe just could question for WATCHMAN the like Okay, at bit growth over just with well. is, little if went curious you could little curious rate just the quantify XXXX? bit more. And provide that'd kind And great. things all, in Thank if of the can flushing out a quarter you. it helpful. the about

Michael Mahoney

Yes, have Yes, providing WATCHMAN FLX gone overall, growth the sure. with won't But exceedingly a we 'XX. rate on plans well. be

the ease profile seeing As with particular increase. benefit at continues the ahead of in converted we're enrolled ahead big the of in use But mentioned, to we U.S point, the trial the really safety it which WATCHMAN fully is this schedule U.S accounts, the of of the been happened of has schedule. reflects we FLX, OPTION and and utilization

Japan small, XXXX. So of have the far away position as in approval increasing has penetration in we growth recently device some are we by the the in driven Japan, the utilization rates. the in safety and comfort starting physician training we’ve we'll driven which with more profile, to And by get account as But U.S from openings. been do some some really get being utilization facility. well and it's impact incremental rates, new as bulk existing second the and But have at new physicians minor so half

WATCHMAN. more facilities are new So more the comfortable referral doctors and the treatment. is being with this community more are the doctors same patients trained physician are on as at doing base, aware and becoming current WATCHMAN And and

to plus to an So platform in that, segment we've of And well for likely it's but growth growth. do continue to exciting this pegged XX% we be us. this expect

Bob Hopkins

Thank Great. you.

Operator

ahead. question JPMorgan. go Robbie Please next with The Marcus from comes

Robbie Marcus

a quarter. add really I'll congratulations nice Two on me. Great. from my

was in you with recovery. rest looks of a First, with the guidance? there think overview could lagging XXXX. structural of seeing [ph] give the growth one any really you discrepancy great covering the in and organic an report you're year any it'd from XX% it the the is the like maybe seeing trends I where us diverse had global be you over outpatient? to just U.S wondering, delta of variant, I such and as think we first versus offering, You're inpatient about here and and Are

Michael Mahoney

in in just so in That ASEAN the More Europe, Japan, most we terrific organic, U.S., significant countries it broadly, the China. COVID to we nice and despite Europe Australia, was COVID results grew well see. saw had strong in impacts the Yes, Asia, in lockdowns results very Europe. and with business impact particular, X% in Korea, and in doing as was

the to EP -- look share you U.S. there, 'XX substantial the business their at And the down we with and outpatient and TheraSphere. gain CRM. the growth where grew XX% in PI COVID with your Uro Endo business, in in if -- XX% share of international a markets saw and exception strong and in and EP the strong But in potentially of -- U.S., markets. we more and And Uro, XX% question double-digit versus in think you every have you ASC then -- if likely and the U.S with the exception Asia-Pac, impact grew really we respective terms recovery more EP, broadly in we globally saw business in So growth from of for organically also organic XX% Endo, and break particularly PI,

rebound reporting by we has public outpatient prior center think been company saw we say setting, both the change in and hospital verified I in to a I us, strong saw So, growth well. of would in the nice the which the U.S., as many ASC hospital

Robbie Marcus

for us Nuance prepared Dan gave, want of a had to remarks. I a trouble follow-up guidance little guys suggestion. a out some hearing and the think your maybe And send Great. Dan, you if you

costs input as But COGS. think the all helpful and for follow-up, I quick really maybe be investors. higher just mentioned a that'd you

that's the the thinking So those first but improving absorb going you be XXXX. company's the great issue Just here, How on quite up and And into an maybe did cost Thanks. down all we in going to second as half, think costs? are to expense the not ability thinking some of XXXX versus to P&L? you about about because component. half way have do pass the you control exit year

Daniel Brennan

in upon Sure. gross half Thanks, we margin, 'XX. that Relative tailwind we those of averaged comfortable are on And that of during margin, going improve balance the gross in second we think Specific first your XXXX, XX.X what's COVID related the put half. over Robbie. in amortized I that we'll will to feel we turns. sheet to on so inventory the here variances the have the

effectively year, QX, are as XXX gone. those this of of so the end And

that's plants good environment. do some have lingering specific a running of still news. We costs COVID So in COVID

obviously, completely is know. not COVID So you as done,

And then inflation have so particularly freight prepared be today. and of we do are do as need to are those I the some and commercial not we to just mentioned flying adding And airliners where we us, than with cost. those have unique in more remarks, pockets flying

there. that then inflation direct We things and locations, pressure we certain and materials seeing particularly, like have wage metals precious in are

of at Investor then, it envision So I beyond, headwinds. of detailed review XXnd of improve in half versus 'XX, as 'XX we we as first will average September. a But back at the would the that do have an assume the would Day to would more you relates half. we XX.X some look on we overall, give and that And we

Robbie Marcus

Great. Appreciate lot. a it. Thanks

Daniel Brennan

Thanks, Robbie.

Operator

question go comes from with Wells ahead. Larry Please The next Fargo. Biegelsen

Larry Biegelsen

questions Good morning. congrats Lauren. on and congrats Thanks and the quarter, the to taking for

pipeline September. the or Mike level of in has to update what goals kind you with follow-up. meeting to XX double-digit X% reason any of provide sales have on think expect, your Just we one And should in will Dan, algorithm XXX to set the us margin and points to improvement an EPS one follow-up Maybe growth basis X% financial Investor just I and changed.

Michael Mahoney

gosh, all up. show you're Oh, not give to this, my if you going we

Larry Biegelsen

Mike. there, be We'll

Michael Mahoney

to visibility portfolio historically. the expect years, we've goals across we've as long range We in on what gives and to the company strategy -- to financial similar an some done update done our provide previous

what more importantly, So across look look you'll and like. hear presidents the you their more to think unit the from company. business will on some we innovation we sales would updated margin X-year approval provide portfolio But guidance,

Larry Biegelsen

on Got your What's for for this in Mike Lumenis? the taking the time sales Thanks my to net million both? after questions. right follow-up, it. Farapulse, was for said acquire distribution that Is for agreement? Lumenis you why just and outlook that $XXX And XXXX? Is the

Michael Mahoney

Lumenis verify I Will net the Yes, have the number. of in past terms number. number get the to that in

-- sense. back will let's we strategically timing makes just circle one. perfect on the that But So

that think the was We benefits margin is the more I which platform. it in therefore into innovate group tie StoneSmart that aware getting effective, the distribution we agreement gross of in China, guess this. Lumenis level comprehensively weren't could had on nor we U.S., distribution wanted And the of agreement platform. same I we our

robust expand product more And coverage in We margins. big can a we and very ecosystem. So our drive our direct a obviously have can we StoneSmart business. China, by in roadmap especially Europe, within owning our then we improve that gross

makes sense. what we do So say And Lauren? that here,

Lauren Tengler

number only disclose XXXX. for gross full Larry. the the We net, disclose not did year $XXX of We million

Larry Biegelsen

Mike? Farapulse, And it. Got

Michael Mahoney

he on comment quick don’t phone, want provide the Stein, know, community Dr. I in maybe on Farapulse, So far Field a Farapulse. enrolling on update third on Europe, it. certainly trial. I in you're pretty The about that in early Ken, proved And Pulsed the platform of Dr. close schedule can you won't expect really U.S go you here clinical excited in we field. and ahead the soon quarter. phone they're on to the too it. Ablation if to -- Stein's physician We're the if

Kenneth Stein

a high as and so And effective more the that to safer to out Field Yes, of is procedure thing publicly physicians, know, again, because Farapulse patients have I Yes, is since technologies. in along that Ablation to reported particularly XXX is than and Farapulse ablation. be approach ablation. probably the be think, absolutely, a and Field others to is Pulsed that been procedure Pulsed over likely more at approaches very safety, than straightforward Mike. you in thermal for Really, most much exciting this for quicker least -- the wealth expectation effective ablation. to-date, Ablation the clinical clinical other trials demonstrated is in What to through of going come data physicians,

as scale they we approved clinical we're continue the OPTION again, approval and in their trials, production. up And approach. clinical ability get execute future, So that the that given opportunity the exercising and extremely given about that U.S to a only are the now help their they're them by Europe, given excited near the well optimistic fashion. Mike to to and said, to their to have And distribution, technology in help them on again, executing in timely now trials closing hopefully, so

Larry Biegelsen

you. Thank

Michael Mahoney

welcome. You’re

Operator

ISI. comes The Vijay Kumar from next ahead. Evercore with go Please question

Vijay Kumar

X%, already once of end these performance, be of organic, provide incremental, Preventice, Congrats in on at that these pipelines. X% LRP QX well implied in look look going XQ X%, that X% high question. we quarter X% to here. XXXX. we're top of the have and look of pre-pandemic on Thanks running my when at If I deals LRP guess Mike. back taking become high implied forward? results I shouldn't the did level. mean, if that half they at XQ to One guide, already we're Lumenis, I for you XQ performance is of on a upper the should a these line versus just in Back Hi, half plus I confidence degree I north running, the X%. the

Daniel Brennan

we'll, for I probably up that conversation mean, not and results. to tee we're going the an think specifically portfolio Investor within X% range said, to overall as the Mike X%. relative to Day Yes, I comment Obviously, the of

in and the think well put don't the put the up would for strength looking the growth in revenue to I to portfolio confidence us what's of we the obviously, comment specifics trajectory the relative that the in it us in But up serve give numbers us the the to the there. forward, given So pipeline past is confidence future.

So -- go but there. specific to where in the range, I I'll don't think

Vijay Kumar

Understood, Dan.

to Just perhaps point operating When XXXX just at be inflationary pre-pandemic one commentary get given Should margins levels? maybe. back should operating freight around on to or margins, an margins margins the pressures? in gross levels

Daniel Brennan

of of year, this half that's if I Vijay. back think for Yes, we're what the you calling mean,

of for XXXX 'XX to calling level, be call an we're So full rounded in back at which our XX%. year average it was half the

second us goal improving half. and on the 'XX to So is of first do as said, that beyond. the set in that was half back in XX.X It'll up margin, and in be Gross for it we half. the 'XX the

that make level, does you is trade-offs thing the the to effective -- specific we've when Investor we'll proven history that over P&L. think XXXX in that operating more get Day. at give So levels, back we time again, we'll if details the time and again, of But through the overall margin

if X, X, X ago, as very And margin back growing and nicely, were places emerging a years and think the in like So you investing we percentage of areas. markets gross was other sales.

So a sometimes progression in operating SG&A very through margin solid delivered but was percentage actually as timeframe. sales, increasing of still that

pay record bit so maybe always more goal to to travel go think addition little forward, R&D margins track to shift year-over-year gross I with have speaks margin The doesn't we as potentially itself in efficient lower it that. make But spend. for is other of the our So and and bills a increase operating spend as will SG&A may speak. that many trade-offs on

Vijay Kumar

Thanks, Dan.

Daniel Brennan

Thanks, Vijay.

Operator

ahead. comes Stanley. Please from Morgan The next with go Furlong Cecilia question

Cecilia Furlong

type our recovery from about in just taking trialing And just kind you've seen really traction I the trends, in what quarter? other morning a of Good to relative tying procedures for recently? Great. more seen elective then what versus questions. and also SCS Vertiflex, and ask of thanks you've wanted

Michael Mahoney

Sure.

field. had haven't report competitors all We the in that

strong And algorithms, that the as had So Stimulation augmented, growth quarter. growth have that a quarter growth as to so The for we the you part a of that overall in continue what in new exceed set, but continues fast We're Really U.S., new our RF improved to we're They And the portfolio. U.S bit versus send it that script as that share. versus out business. mentioned, overall work first unique well we're driver gain doing, combination it may acceleration to But novo and our then them portfolio quarter. business. with has big to I -- the really it's share the impressive And is detailed with not neuromod clinical number going market in in Europe, expectations. RF as the the algorithms the SCS we a Brain Vertiflex as other in think competitive The smaller continued was of gains although grew now market the have new Deep quarter and player in XQ. people. exactly I the innovation sure to they in the group And was accelerate the one close the a of how in fast and to combination portfolio de we that launches. had through done. continue really well then hearing. of difficult

in the sequential the But with business saw. we probably and win quite that the competitors but SCS see the U.S. report, well. pain the But impressed of did DBS quarter side as the COVID other snapback the largest how So overall, we'll any impact market in had second we're a well with growth the

Daniel Brennan

happy And neuromod all overall XXXX versus Mike that of that just the growth with for XX% detail. business

Cecilia Furlong

prepared Great. COVID? recent Could And a seen out just more, just from you bit remarks. recovery coming you also and you. what called comment trends your Thank procedure resume procedure of [ph] you've out trajectory

Michael Mahoney

confidence we're And with think resume big Yes, continue some bounce things improved back focusing expanding The resume the business so some I there. is also additional reimbursement and growth to continuing we're our international helping. But campaigns also overall also the drive that's physicians with footprint growing XX%. more the big giving of direct-to-patient in And more direct-to-physician, on to we our data the to growth. the we've product drive and with that with DTP, is Europe, it's which a in payers awareness. resume, rates, durability the specific in Uro quarter that's increased and business, long-term marketing particularly drive driving the had

resume. that's those a the of So things growth improving it's of really profile combination all

Cecilia Furlong

the quarter. on congrats and you Thank Okay.

Michael Mahoney

you. Thank

Operator

The with Please comes go Pito -- from Bank. excuse -- Deutsche next question Chickering me ahead.

Pito Chickering

and XQ at also challenging also versus Bob's quarter But best the on Good my XXXX on that continue a guys. X%. question, follow-up June strong questions. I July. public the month the Hey. comps was heard congrats trends hospitals June Thanks morning, for to we for is taking Lauren. understand of and Congrats To the quarter in nice into

quarter? So you as are you'll at some guidance, simply are third look point XQ quarter your Or during assuming just you the you normal curious, seasonality? that at seeing see

Michael Mahoney

question. appreciate we sit as quarter. We're I just the not the kind Yes, third of comment, quarter here in going to intra

is in it not the short we I quarter second the to Bob's the We're in to that question in -- going a month-by-month. answer think saw trends expecting we're we're expecting continue. the We're answer adjusted the going the month, to half that -- of month continue trend overall back rate to comp But versus into that not of in to get those growth 'XX. specific specifics. to parse

Pito Chickering

the understand due enough. markets the have fair question EXALT last COVID. dynamic to for on I Okay, been D. A years very Quick

And many as How share how EXALT rate Into those you of reorder selling assume market D, back questions. revenue you are and this accounts the year? two half much we of into watch the Thanks so the in point? is So what D much. the accounts, contributions EXALT at accounts?

Michael Mahoney

EXALT prepared team Yes, D continues the in the frustrating progress. we're share call, heard to as previous probably just here. you. And with updates, make to information We're not you've that

the to if As D hopefully, then placements uptick And the as delta with with see training more variant release, next-generation much, uptick but comfortable more as will, usage. 'XX, you'll although in improving, becoming D you physicians EXALT traction the too improve approved an COVID you're the a EXALT capital enhancements release, D, next so half EXALT well, of or platform. second of in have are U.S., further isn't in impact gone seeing in the and and seen it, is have we of

competitors, continued really with we bullish EXALT to that. with recent differentiated the say, but market on some it expect time capabilities a let's in and established have EXALT see platform, think us that momentum for Europe. we And approval an of few The D. that first big sites So the for tried we're D is news with some we

in much platform you'll of second see more And well. of so impact and so in half 'XX, the as 'XX, that

it's we're going some improved in D but the momentum plan, is So as EXALT seeing improving. with COVID U.S all to

Pito Chickering

much. so Thanks Right.

Michael Mahoney

Yes.

Operator

comes question Wuensch … Please Joanne with from The Citi. next

Joanne Wuensch

you can hear me Hi, okay?

Michael Mahoney

We morning, can. Joanne. Good

Daniel Brennan

Hey. Hi, Joanne. Good Joanne. morning,

Joanne Wuensch

key consensus, thank Excellent. be areas CRM. question. of of also the into But position? you taking that compared to back that bring might and might are the us sort the in number that you products versus remember I EP or one sections. two and a for Good or delivery morning there those like there's a It highlight you market we Can bit taker looks two when or gain lagging little

Michael Mahoney

We nailed market. below digits it. each below we're bit Yes. we globally CRM, 'XX, but little And of while Well, double you think a take one likely that's versus EP every businesses our market. grew with exception,

think you'll markets we we similar for two, likely did other those growth, And next years. grew see trend results EP which expect one think market to quarter. the of think And we exception our second the that of they couple I the faster a international EP, in markets. exceed every With in than

previous question cryo Europe. this is commercial stable competitor in closing which taking in now and with the our to as platform, quarter, established our cryo approved Farapulse forceps be third of in heels in And the -- and the early we're On point, Europe. deal where the only there. their our then player share and catheters And we'll

distinct our we and cryo of see 'XX full and that expect the Europe. three -- in towards second STABLEPOINT And 'XX. Japan of technologies differentiated Farapulse. closure, be towards in to also are year cryo Upon platform benefit will with our quite the the end So IRE

U.S the platforms products our market. rates So the clinical which as those days. have get grow those is right business lag And all significantly EP international COVID approved. business run our we trial trial clinical in now. now increased over past the XXX faster U.S. in until market bigger our business, will likely those products than And will improved, of And thankfully, are

implanted in And and we likely bit quarter, for results is calls. this segment you all of in we quite S-ICD the year the U.S., the growth fourth strong have rate in new And half globally. we rates be to take in -- lead lag second the our had, earnings caused coming will CRM EP. which U.S a our and third CRM, us in Really S-ICD now the versus our the which less expect in primary is to that the think performance across balance And S-ICD for a that outside market So in so likely segment Europe sales is and quarter now for the will being a reason advisory improve the U.S. saw for And closer S-ICD second bit which what quarter. to the of CRM. improve for us quarter versus we overall us, of a that second will growth business improve big that

Joanne Wuensch

answer Thank over you. focus products the next to And on is my would If are three related. had to say second X the be? question what want to What to also product your you you, XX I us months.

Michael Mahoney

I've only picked three.

doing it. -- combination gone profile well. -- I I very WATCHMAN, speak The and exceeded acquisition think know a extremely within in give overall PI, yes, of Farapulse. has would think one enthusiasm. -- third expectations on is bullish BTG the I of the lots different its in early. we say I there's of and just Then me to the one, areas cryo if I number you in to, segment scale super the this see growth Varithena within TheraSphere the given particular think We're

U.S the That IRE only is company large will yet, EP so the be is force-sensing. in and that cryo the and that not have good. so of market Although and growth profile will

exciting So dollars us. for now smaller all opportunity those

Joanne Wuensch

Thank much. you so

Michael Mahoney

bet. You

Operator

go from next Travis with Please Steed The ahead. comes Barclays. question

Michael Mahoney

Travis. there, Hey,

Travis Steed

Excuse me.

was I mute. on Sorry,

Operator

open. your Travis, line Mr. is

Travis Steed

Thanks Hi. the on of Good operating you margins. morning. longer term some I for appreciate gave comments the question.

basis XX% that the Just XX should if the here. we for base year, in what half points or curious should XX% be of about back expansion for using think margin we that

to place point? this be street in be would the at about year XX.X%, reasonable next thinking a So somewhere

Daniel Brennan

off I would on for would reasonable XXXX as starting XX%, kind I But a comment we of think be It's to point half. resetting there, should a Yes, wouldn't XXXX. you were that for here I be basis jumping Travis. that's nice and the it point where 'XX. Yes, 'XX, we're in agree with in back the

Travis Steed

then the the full Okay, I was guidance sure guidance just year wanted great. message raise. on And clear to the and make

are X% to So that to same? the XXXX Is you're you from going the actually versus expectations QX staying year basically to in half and X% X% half X%. here versus original the the back confidence expectations? for are all full coming your seeing so from the more beat Or back

Daniel Brennan

in I of to and of QX impact in in -- the return go guidance COVID April, the and QX, back for impact more more normalized was part and February, No, it in you think most COVID in less back original a if QX, to then volumes procedure QX. reiterated

to our QX were as early which of would you back if results that I about the half, point QX. got think ranges we guidance little of then is take the our just a versus It's for of we as saying And of what QX, and bit we type same type base in a QX. story It's same broad say QX, the pretty in not results and much QX COVID QX. impact QX.

Travis Steed

Okay, great. Thank you.

Daniel Brennan

Okay.

Lauren Tengler

… that With

Operator

question … next The

Lauren Tengler

it Since Investor to Relations our with No, the remarks would Andrew, hear the posting of remarks, or we the will to conclude website. be prepared some was to difficult call. transcript that prepared we like

disconnect, replay. you the Andrew the give pertinent Before you all will details for

Operator

either one recording Eastern has using conference Again Please X, The available or hour be Thank XXXXXXXX. PM today's access XXXXXXXX XX:XX at XXXX-XXX-XXXX hour August attending by for note Time. XXXX-XXX-XXX presentation. until dialing now you XXXX will -- concluded. in code one

disconnect. now You may

Boston Scientific (BSX) 27 Jul 212021 Q2 Earnings call transcript