Earnings call transcript Q2 2023

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Operator

Welcome to the Boston Scientific Q2 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please also note, this event is being recorded.

I'd now like to turn the conference over to Lauren Tengler, Vice President, Investor Relations. ahead. go Please

Lauren Tengler

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

as copy Investor of the We Financials the that our of reconciliations have well full your today's the on questions. The this morning's And measures Mike call performance as Dan to website a Relations take in hour. outlook used duration posted & will year Filings. then, heading non-GAAP business release, of we'll will under as call and for the section QX including XXXX approximately on our provide guidance. and be X comments well QX as

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

February Acotec which for growth Holdings closed in and of Scientific April this begin, in there The Limited full we net divestitures excludes operational year. Medical, business, everyone closed or of stake which Relevant that impact the and to Baylis I'd majority closed Endosurgery, than this excluded the less April investment for organic currency remind comparable call, fluctuations excludes growth Divestitures endoscopy divestitures which and revenue and foreign growth include XXXX. on February revenue acquisitions organic period on further and of are year, XX, a the like Apollo sales. pathology respectively. of which Before acquisitions

quarter global approvals June to stake on had elected Acotec unable XXXX, agreement results agreement required lag, some Tech, On we immaterial in reported our that results. on obtain and purchase regulatory we to impact XX, were a a that, into definitive M.I. to a in have note the QX our which announced entry Please adjusted an consolidate we one majority countries.

terminated was in stake year, in purchased As we a Tech. a of this and June agreement the result, minority original M.I.

and more refer be website. For please highlights Relations found our deck, may our on operating Investor to which information, financial

revenue, cash references call organic. other are all contains estimate the to anticipate savings growth forward-looking within call, specified laws, be R&D words sales similar the meaning share, approvals include, federal and expect, rates, among anticipated opportunities, this identified believe, growth about unless our sales, like in statements otherwise expected They as well use, words. margins On may, launches, our performance, This financial and market and which new flow may product and trials, other by securities things, of clinical other expenses. tax and earnings, statements our and cost our acquisitions, and as and spend including

XX-Qs If incorrect our the be turn by used from risks certain materially if vary subsequent actual or those to and them. of today's statements most update of only with SEC. speak the we filed as include section on or may underlying cause expectations out and differences Factors any or Factors implied recent in projections expressed described Risk assumptions our materialize, – or such obligation or disclaim that forward-looking the statements. intention XX-K our could These uncertainties to results and date

over At this Mike. it point, I'll turn Mike? to

Mike Mahoney

of fueled our spirit leadership team. proud XX%, sales or guidance and and category our range to that for units our demand. of the strength innovative healthy our which end respective faster our to quarter most grew organic the portfolio exceeding by 'XX, in also X%. commercial supported everyone thank We markets, procedure high Lauren, of line demonstrated and joining grew total commitment execution, of second our both operationally to exceeded today. results, second and our and second you expectations quarter organically 'XX, global quarter X% In by winning us business clinical company than Thanks, We're strategy, anticipate of very the evidence, versus of the

slightly grew growth the regions. range first $X.XX of higher of high units operating rate second versus EPS the than adjusted $X.XX. the all have grown we quarter across of 'XX, guidance margin XX.X%, of exceeding also XX% business anticipated. broad-based with organic end Through quarter the $X.XX and second business our at And quarter half was sales year, their XX%, Second of adjusted to durable

have also during long-term we the our growth and ensure EPS our goals. first to short-term while we grown XX% Importantly, achieve investments our half, adjusted balancing

we're Now full X% XXXX our year and to XX% expect to 'XX X% momentum guidance we and of third organic continue quarter the are XX%. raising organic guiding guidance, our for to revenue growth to

third provide now will on adjusted our and and $X.XX outlook, on is the we're full year comments 'XX our along Our highlights financials. $X.XX quarter some $X. Dan I'll provide range estimate more to EPS to quarter, increasing in the adjusted second with EPS to details $X.XX additional

major and basis, ACURATE an businesses. PI ongoing broad-based, X% grew Endoscopy our Europe, in X% the basis versus POLARx, portfolio, strong including operational in performance strength an LUX-DX. second product saw and grew region the Regionally, U.S. in neoX and second strength East and four launches, markets FARAPULSE, new with double-digit out Middle in the quarter, Europe. was of on growth in WATCHMAN, we five on notable quarter, operational also with with in our Across Africa

arteries, our Japan delivered that quarter and growth impact quarter, XX% by led by Japan. our products, and China is with resonating balloon fueled strength Asia led market. drug-coated by behind Pacific leave and procedures versus commercial innovative performance invasive quarter, operationally China in including resume nothing excellent the the the agent, against portfolio minimally second 'XX. technology our COVID grew in the new growth BPH is second in and for coronary execution device second

expect continue growth China saw also full we WATCHMAN, cardiology therapies, for We strength in units to in double-digit particular business PI the and and interventional our CRM year.

sales Rezum continues double-digits businesses. Urology in to second our in urology. and recently additional and grew Brazil. The organically the quarter do efforts. provide globalization launching well double-digits, LithoVue commentary grew management by now growing I'll in most globally, strong quarter. driven ongoing stone X% franchise some Starting the with on

We awareness activation to designed momentum ongoing prosthetic our franchise, erectile restoration patient to bring within to our male efforts. interventions. by urology see fueled continue and incontinence

procedure Asia-Pac, notable sales and growing and second operationally with XX% Endoscopy excellent, XX% new momentum were U.S., quarter, Latin in organically product America with in healthy the the demand. strength and

device integration that improved benefits endoscope. when is procedures. and ease-of-use endoscopic received single-channel Apollo this suture placement accessibility earlier a progressing OverStitch system enables brings using next-generation clearance that advanced for and we Our suturing FDA NXT, during a well month This

growth Neuromodulation X% Notably, demonstrated evidence, second at support endpoint consistent back the Aspen. were SCS outcome reported the was prior to of outcomes superior of quarter. month against presented were this in quarter trial sales with which second half from for conventional which pain, sales randomized expect trialing organically trial, the non-surgical improve flat six-month versus in results. we primary with SOLIS medical data in also for grew which the a in controlled strong clinical second stimulation Spinal and year, SCS year the sales cord is management,

continued Europe. with Neural our can Navigator with the when clinicians system the programming efficient of procedure brain the FDA U.S. Our this brain used software, quarter, in product help approval data month, in in X which and Earlier double-digits Vercise the disease. from deep received launches momentum recovery franchise grew for stimulation new provide we in for treatment with Parkinson's

'XX. Interventions second versus very strong quarter growing sales Peripheral were XX% organically

the updated And eluting grew this Our recognizing treat FDA portfolio. that provided FDA by these earlier led do double-digits, for devices and determined not mortality drug PAD, labeling. that reviewing their We're patients. after paclitaxel-coated within arterial of remain an our care for best franchise dedicated used possible pleased risk associated the to specific data and eliminating information safety the support with data the and the language physicians all requirement available analysis, helping we excess the device-related warning devices available to month, provide

for management ongoing by technologies. non-thermal in veins, U.S. with In Varithena, led international strength was growth by driven a clot Venous, our growth treatment varicose

grew with franchise system. EMBOLD coil, And month, and complete strength Interventional Soft coil Our entire detachable our with the received we across the the Oncology EMBOLD, Packing fibroid double-digits along which clearance for last portfolio. Coils,

our portfolio. which that's only the the is gel for embolic also robust conformable our market began indicated material Obsidio, embolization limited to release for peripheral We vasculature, adding

with quarter excellent business, sales another XX% versus Within cardiology, versus sales delivered growth quarter. second Cardiology Interventional organic organically second quarter. Cardiology of grew Therapies the XX%

well price pressure coronary innovative technologies as in the offsetting Japan, driven by Our imaging balloon ongoing drug agent of as in eluting recent launch drug-coated stents. our growth franchise therapies was our

and reception backed a structural neoX double-digits of remains quarter in by high, evidence, valves on ease-of-use clinical benefits performance Market very patient strong franchise another lifetime Our grew with from management. ACURATE focus our heart Europe.

in neoX the to to bring XXXX. expect to continue second of U.S. half We ACURATE the

U.S. the have enrollment and FLX XX% WATCHMAN the pilot of sales is pleased design study, organically market. was Japan. led multiple in assess demand outpacing to single grew healing post-procedural quarter, which remains to Pro. imaging a generation versus strong WATCHMAN international study were the second WATCHMAN using China Pro completed CT We next and by FLX in growth also modalities

WATCHMAN our by the end momentum approval XXXX. We both FLX sheath (ph) and WATCHMAN further of the called our the continued franchise expect Trusteer by supported of within anticipated steerable Pro

grew business replacement in CRM, as digits the Cardiac grew tailwinds performance high-voltage core our and growth the grew we market business in organically X% mid-single below digits, Rhythm slightly or and Management line sales quarter. that believe was neutralize. In low-voltage low-single our

cardiac supported diagnostic of later by grew double-digits ICM called will Our the momentum next-generation on and the of portfolio year. quarter the expected in X LUX anticipate our we broad approval this continue, strength our franchise diagnostic

strong sales and FARAPULSE be growth both performance across continues Europe XX% Asia-Pac. second fueled by organically International the in Electrophysiology to in quarter. and POLARx grew

in quarter. to to these continue towards innovative third make and bringing technologies POLARx approval the the We we progress expect U.S.,

August In forward of our U.S. addition, ESC IDE, XX. the data we trial, are the at on presentation ADVENT to Conference the looking

XX-month Recall the rigor commercially a an notable reablations. and for a systems. kind, without of compared procedure is endpoints clinical antiarrhythmic and use as the ADVENT safety a randomized effectiveness trial for the designed to of demonstrate drugs design non-inferior it single primary and intervention RF and It cryoablation seeks efficacy is of its its trial, to available first

to in of We the U.S. continue the in approval anticipate XXXX. FARAPULSE

momentum today, pipeline sales underlying a flow second Investor in our innovation XX remain and and September grew our consistently franchise generation. Day, strong our the We're Access the confident financial opportunities performance teams goals. Japan double-digit U.S. more sustainable VersaCross our with a future. to provide than in with financial continued operating with We in growing The expanding Solutions the team Transseptal differentiated the free committed growth our adjusted our goals, to of are also global We're proud where double-digits markets, strong insight and platform. quarter will into and of our EPS strong forward innovative adjusted faster long-term margins ahead cash our delivered looking leadership and

plan WATCHMAN Dan, franchise Scientific, before five Maulik I And his we some will announced our pass it years he movement before to Cassidy So at after has neuromodulation want years nearly in Boston business, announce August. along to the also prior business now XX I have years to lead unit spent ago. eight to team. the moving leadership within where Nanavaty over retire previously Jim lead that

for and his Lastly, spent the Neuromodulation Congratulations Boston EP we the to leading of career. Angelo business. many most throughout our Scientific Maulik years has Jim and in Angelo Scientific lead and Boston DeRosa XX Europe, in appreciate business. now Angelo contributions CRM to will European recently his WATCHMAN last

With over details more provide it financials. on that, to I'll Dan to pass the

Dan Brennan

Thanks, Mike.

revenue basis XXXX XXX reported and XX% of Second billion versus foreign expectations. consolidated $X.XXX XXXX line reflects point growth second represents exchange, quarter of in with a quarter headwind the from revenue

basis million headwind divestitures from quarter. XX% of growth, to and exceeding this organic our resulting Sales the operational revenue X%. exchange, growth XX in from revenue XX.X% X% range points, Excluding $XX in guidance acquisitions was foreign contributed

margin favorable effective tax XX.X% QX resulting an expectations, the of was ahead for XXXX of by for high the $X.XX, performance Adjusted quarter. share our XX%, $X.XX earnings slightly sales in range second versus rate of gross driven adjusted per gross margin the end the to and quarter adjusted our XX.X% of half guidance XXXX, strong first exceeding of in of grew XXXX. a $X.XX

foreign line margin the to lower half expect exchange of second and gross first of XXXX, We be continue in half second largely in to XXXX. XXXX to than of with the due movements timing half

slightly was quarter ahead offset Second adjusted by operating line performance slightly margin higher strong of predominantly expectations, XX.X%, and top SG&A driven spend. by partially

of and On was year XX.X% which are approximately quarter second XXXX operating to margin would points the expansion XXXX. of continue versus operating goal XX maintaining full on improvement year We a GAAP our focus the represent full adjusted basis, XX.X%. adjusted operating margin, basis margin

totaled operational June in stock of quarter. driven the than million upon the Moving weighted to on our by below certain QX, items second earnings line, geographic lower of volatility million, currencies. anticipated adjusted adjusted X,XXX our slightly and $XX second shares discrete our preferred by to mix diluted of which conversion shares tax of convertible rate higher a year. outstanding driven common million quarter X.X%, interest this at Fully below average in for XX.X%, FX the XX.XX On slightly includes in shares ended quarter issuance of X the mandatory rate other expenses and basis, due the unhedged certain expectations an than tax expectations, tax was

was $XXX flow from operating for less $XXX quarter net with million million, activities, cash capital million the expenditures. Free $XXX

flow adjusted items, cash was special $XXX million. free Excluding

to XXXX continue flow in year full of target free cash billion. adjusted $X.X We excess

we June $XXX of times, was cash expectations. As in our of on and XX, XXXX, our X.X with million had hand line leverage

I'll guidance year. for QX and through now the walk full

to revenue XXXX of operational to in range basis XX point excludes XX% an expect headwind from approximate be which growth exchange. XX%, full We foreign year a

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

tailwind a We XXXX, to on XX% be basis based third to operational expect of from XXXX revenue an current foreign QX rates. growth X% approximate XX quarter exchange in point excluding versus range

and expect third be growth X% we of to acquisitions a to X%. XXXX closed divestitures, quarter from range contribution revenue the organic Excluding in

We approximately adjusted line year XXXX full to to $XXX continue expenses our expect below the be million.

rate recognized quarter. be XXXX Under operational We of year current continue tax approximately favorable the rate approximately tax sales, of second an to in to adjusted discretes expect expect full and now XX.X%, reflecting our we legislation mix forecasted XX%. geographic tax

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

to full XXXX, expect $X.XX performance. share be earnings we to of We $X, believe in year tier top adjusted representing delivers to financial versus growth XX% per which a range XX%

neutral earnings third range year from per earnings $X.XX. We expect adjusted our FX and to continue a to anticipate in adjusted on of a XXXX share per full quarter to be impact share we $X.XX

QX and and which XXXX please details operational Investor Relations check on our more information, website For more for results guidance. highlights, financial XXXX outlines QX

half In very and our second organic earnings momentum financial operating towards performance revenue adjusted XXXX. continued to proud top half closing, XX%, look I'm XX%, goals. of with growth in tier share forward first our top-tier contributing of adjusted of XX.X% all margin financial I growth of the of per

to turn Q&A. And moderate the it with I'll back that, who Lauren, will

Lauren Tengler

self questions XX Dan. order to their to one let's minutes it go In up ahead. limit Thanks, Kyle, as the questions so. Kyle, next or for question. for open for us many possible, take please please as

Operator

Lauren. Thank you,

first comes The Please with JPMorgan. session. go ahead. will Instructions] from question [Operator We begin question-and-answer Marcus the now Robbie

Robert Marcus

nice and morning on quarter. really congrats a Good

Mike Mahoney

Robbie. Thanks,

Robert Marcus

It one neuromodulation. well. geographically like the across much some looks It that split as utilization, really a looks pretty regions. was well, board We've with statements care the like my strong public managed looks saw kind outpatients bolus heard it global from companies in but exception from like you guys question. of with across it as beat was it Maybe the a of

you're Thanks any outpatient, what's world? onetime love the if to lot. I'd seeing, on cardio different around and get what you're what And read the is versus regions in difference a you from what demand, upside, inpatient, maybe seeing there's non-cardio? So underlying the

Mike Mahoney

Robbie. morning, Good Yeah. Sure.

outpatient strategy outlook to our with offer we interventional Boston is are towards. know, think we that's So that geared long-term procedures is trend in which the the an portfolio positive where market very very for the as and setting, you is moving Scientific, for

a easier just that some play There excellent world. but Japan, Japan really, was related. for as in But -- more quarter had But China. a really doesn't impact. dynamic primarily strong an benefit, it's second think related COVID quarter. outpatient So last due snapshot that's around as an quick I there. performance COVID quarter in whole portfolio great in very much really year portfolio to significantly just had China comp the Asia-Pac

what's I the regions across and all board, markets. the And about it's the think impressive emerging across Europe, really

in and Russia, we're X% than in slowness Some U.S. but lightly X% less Russia, as well. exposed grew

a seen demand. a patient just very in You've bit other for some the we to very common continue still regions. There's of physicians. our a typically higher of most procedures outpatient But see U.S proportion of list procedures than for strong wait the

the terrific So market. a it's portfolio meet very have and supply to we a steady

Robert Marcus

a lot. Thanks

Mike Mahoney

Thank you.

Operator

Wuensch Our next with go Joanne question ahead. from Citi. Please comes

Joanne Wuensch

thank let asking – and me for ask. question, morning you the for Good taking

As good I'm to more for XX meeting. very this analyst soon or ESC going the expect as to you what about quarter, print about questions and for get

So or about expect set framework? you what maybe or you of the right should putting two events can sort within those level how we think set

Mike Mahoney

Dr. need I'll Sure. further I to maybe -- if Stein and comment comment see I'll afterwards.

Kenneth Stein

Field sharing RS and It rigor is and in design of our Joanne. to of rigorous data trial in incredibly of Yeah. release our ablation look an the is Mike. forward of to the trial. the randomized which from those Advent, of Thanks, FARAPULSE this we Obviously, trial It's Thanks, States. thermal United Pulsed IDE that going Ablation point, terms the highlight proud and system aware as in really monitoring, is against endpoints at be Cryo. first space, in everyone approval to We're this at public. FARAPULSE is, the the seek results the I with big ESC think comparing with

Mike Mahoney

increased quarter, chain We constrained councils the in Europe. still have really our FARAPULSE on utilization Europe. comment with see additional supply pleased in in make the To been Yeah. to

we've just supply which we the out far, But for our where this ability to actually for exciting, manufacture for exceeds a are we received to platform manufacturing in a approval quarters So recently the GMED a row. approval thus number of here. reported far what's Minnesota, in demand

And chain, of work advance quarter that we XXXX that team so the on anticipate, the capabilities materials fourth continuing well expect significant European and of accounts the XXXX of the and of the U.S. increase we the supply with by in in new in in the availability launch a do in

you in meet of proud the me. the really to Europe in build of internally utilization what chain but be performance the quarter, fourth in new So impressive, to opening number capability utilization platform. And team is within centers continues the environment of expect supply to this demand. a the the this growth the speaks which The should to served surprised centers

Dan Brennan

to which up for here I investor specific Day, expect in coming days. then see Investor And what seen is September past Joanne, would to XX on us, you've

You'll of what see give the think can we our a with us over three financial sense the we next years. team goals do

worked well to in it's us in for would us September. the past for and formula, So Investor I a look pretty do our here Days same

Joanne Wuensch

Thank very much. you

Operator

with Our go next ahead. Stifel. question comes Rick Please Wise from

Frederick Wise

Dan. play I'm Thanks drivers. so performance, quite performance. as well? did to commentary, divisional understanding more out us stand it a Is half margins it Mike. not what is And maybe focusing volume, mean, I much. mix? were your and Hi, XXX the morning, price Dan, Operating detail excellent And basis I'm XXX little particularly Help the the sure a second about role? points. Good margins Maybe cardiovascular basis points, on margin MedSurg up up understand extent

Dan Brennan

Sure.

finer and put on try point a Rick. that, me Let

that spot puts a our is for year first quarter, Specific for the margin strong history us, goals. it's accomplish of which all which to overall in show for operating lines the I full in QX that to the the well target, second manage real XX.X% ended with half, So good always the the we achieving XX.X%, would XX.X% about XX.X%. pretty a And P&L think at objective. operating we us margin and

the more may So get goal of to less. the is, to in see P&L obviously, might period, you area line. ultimate But any given one or that bottom contribute

to really last here, investments I'm of that basis were And XX.X% this have to that better upcoming we hopefully, some with points to QX, success key starting we ensure margin. launch. than year. year XXX the happy accelerate that then got And operating really some SG&A adjusted those It's we specific Cryo able our of also transformational to launches

the So for about story. all operating can the margin it's of contribute areas us, overall P&L always to

for margin, the Relative But with half for be in to the being north second half lower said, half, second more the second second second XXXX. in in half first for should gross were in was us margin the which lower half, range get will XX% a will FX it of should -- The for the operating line XX% the the reason kind obviously half was get for higher the that goal little half, movements as last half, to first of in and first be XX.X% gross be of that we the half. us year, year. is we've the in than the in where margin the second

operating to So relative second posted the that get the but And to to margin to number half second to get we see step QX is, as margin would higher in to expect down you the in quarterly to overall that year. I little XX.X% then half, in one slight I up XX.X%. gross for nuance go in to forward, XX.X% step lower think a and a QX that get in the QX

half So bring QX of second year. for to were bit flavor hopefully, it what a the we gives that would that and how little to get the of you in thinking us about XX.X%

Frederick Wise

Thanks. Dan. that Appreciate

Dan Brennan

Sure.

Operator

Next Fargo. question Please ahead. Wells comes from Larry Bison go with

Larry Biegelsen

as manifest, here. at Thanks question. quarter reiterate success my rate in XX%. Dr. success think strong another using morning. I the the was congratulations definition for Advent, Stein, on Good the taking of just Advent same I'll

the differences rates as previous for do when Cryo impact the have differences studies between long in for and think success studies criteria FARAPULSE? results and the could how separately, the to those question. same do And you Advent? two we Sorry need consider the what using with So been much what RF

efficacy and adoption? how on Cryo, numerically impact it FARAPULSE RF will Just question. the or lastly, do think is Thanks taking you success if versus for lower

Kenneth Stein

Larry. Yeah. Sure, a there. lot There's

start me this everyone. lot different to space, trial across again, Advent, whether ever constitutes the PFA or has The thermal been definition And a is reinforce Let success, frankly, the definition to compared whether very most of that's of I it's trials. in think, right, it's rigorous any of ablation. what done "success"

so had And continue and after randomized cannot success is requires specifically, even ADVENT ablation. antiarrhythmic the right, three previously a that that have have to month arrhythmia to cannot the patients failed at so-called period trial no recurrence, index doses taking and drugs be reablated during blanking

It three for arrhythmias, of in the also very the includes Holter course one-year study. asymptomatic periodic a follow-up the rigorous screening including throughout days of of monitoring

to the for non-inferiority. and efficacy. rate expectation, this I power achieve was our safety terms this remind around then back success an of there's which way Heart we'd design manuscript think the FARAPULSE in trials. And for around the other study, And in make again, were comparisons everyone, designed no thing, the arms. refer thermal of in would and assumed Rhythm. for for study I'd to both a standpoint, powered because of across apples-to-apples demonstration the the ADVENT that, non-inferiority both really published now optimal definition success And everyone do to from to online constitute is the using XX% of studies And

Larry Biegelsen

Got you it. so Thank much.

Operator

question with Steed Our Travis from Bank America. comes ahead. Please next of go

Travis Steed

quarter. Hi. a on good Congrats

would the ADVENT? frames And you kind said the growth the how on how curious it think out? you if share your the FARAPULSE question, commercial opportunity product curious comes the career, frame I Thanks. data? blinded And Larry's still yet based you of on up just and to based market but are various or up following potential exciting think you in commercial launch then for most out how maybe outcomes seen ADVENT you've for for the opportunity the to data Just

Mike Mahoney

very as Yeah. a well. obviously been has product pretty bullish. We're launch WATCHMAN amazing

certain very for drowned Sometimes that in of do thing FARAPULSE of while a market. build the quite exciting for seeing would manufacturing and we momentum category demand important it growth to capabilities, But these to which the in us. post-acquisition up could we're Europe continued and We've is gets in Asia-Pac. is that been in be the meet that in out some investing most countries

pleased very drive I that to milestone. in fourth the commented quarter. expect we're as installs And number earlier, with a of So new

mentioned in also I utilization. ongoing increase just the

that markets sign, in the it, is throughout and who are terrific So which progress. selected to usage Asia very more drive of saw what physicians that to using a with similar Europe continue really WATCHMAN in we

persistent announced as We very a we've ongoing have enrolling also which advantage, trials cadence enhancements portfolio. trial strong in other very with that as clinical our the is quickly trial well of

one feel we the the So we strengthen many this continue opportunity. know very R&D -- a the really data fastest portfolio, with very have fastest-growing the field the we we to and the along of we have competitive exploit and FARAPULSE a infrastructure advantages to but have WATCHMAN studies science the clinical the and commercial where low to clinical it's driving share. have growing market, it, it's continue to in fields We advance to with in MedTech, also

we're and to forward release. we're ADVENT looking it, on bullish So the very

Operator

Our Danielle go UBS. from question Please ahead. Antalffy comes next with

Danielle Antalffy

the much. congrats everyone. and along best him. Good to pleasure pass appreciate the for taking so it. morning, always my And to Thanks make thinking my half He and higher. to all want question understand I I top takes move really line the And does Maulik. of year so if a around question about work is there. just Thank you just organically to you much growth I'd It guidance. puts was sure back the with, could

at get much some tougher to of but does basically from basis, a does comp little how things your real half to a to reflect the half? bit driven this looking when business an of prudent is much. perspective you I just need driven Obviously, the which we back conservatism do so some organic guys back year want part, versus tend product on Thanks or on consider deceleration. understand

Dan Brennan

Danielle. Sure,

can I that one. think take I

I the about. and third the XX% we've that. full that, they at year to to half, revenue fully proud take to is double-digit If that's X% performance quarter of X% X%, guidance half half, at for mean the when which you at range the look XX% what the gets for the given second get XX%, is organic look the fourth you year the year for of I'm coupled excited super second the with to growth to to exciting then first to is XX% the midpoint. full a implied full so you And X% result. that have I'm for quarter And X%

appropriate where that's and second half. the we comps, a guidance are prudent little think the I in And with harder they're

in that XX to year, like good harder I XX% think first coupled basis company. with for us than year, I to for full the the But they is X% half. the half that for of think year, basis it's margin in points XX% successful the be overall, for if a XX%, half. will I it to to think XX% second the growth EPS that pretty of EPS call year I'd expansion a and appropriate, really are And the second adjusted X% gets XXX prudent points that

Danielle Antalffy

Dan. much, so Thanks Great.

Dan Brennan

Sure.

Operator

Please Jefferies. ahead. Our from Taylor go with next question comes Matt

Matthew Taylor

investors focused puts had (ph) get taking that kind and on Hi. savings I key we for freight think that there, if of any factors question. Good be the potential lower Do the you and going things beyond, inflation guide thanks for expansion like could? understand lot the to wanted component guess. you forward. of margins in I on 'XX margins, and think I just you some conceptually for morning, takes are a to see maybe on could And of and abating and costs. of the high-level speak Dan, I to specifically, one for more and margin good

Dan Brennan

overall I'll the of at operating the Sure. start kind margin level.

a you that the top XX.X%. for grow the target say leverage is just beyond it runway prevents you margin well to the And times company. reasonable very of There's consistently if said durably, margin So a still continue to this that news adjusted is a structurally number from that we XX.X% that we goal that We've for the there. for journey to of extent expansion growing believe opportunities that. many us plus you that operating good publicly achieved gives have XX% line, getting year, nothing a us, there's long

that as have a of you backdrop. So kind

we the margin $XXX think in of hitting margin. to of XXXX gross this had areas And million stayed relatively year, basically said the we Specific the I versus impact piece consistent. largely it's in 'XX in gross inflation P&L, that is and,

a tailwind were that a in not we versus but that or it's obviously, a XXXX. XX.X% versus headwind last year, margin headwind So

'XX. your to I a going don't around what abatement of think lot we'll inflationary specific So in happens forward, question see

approaching given year, gross think we've of kind I the in guidance mean, is for be are will where this forward year and we I beyond, the 'XX of look we're But we that full assumes the kind year. the XX% year. -- we for -- yes, are as to margin

So that's a gap be. we to used where to

goal, our And We level. to need back you help that, we're do macro some focused maniacally that mentioned. in as on getting

process the little a we the see our freight, manufacturing it’s then to some it the better, of used that materials time. do our the that we process, supply that’s mean, into I into getting be. abating over cost of improved, the of of elements improved. So to has of where but consistency inputs manufacturing back frankly, And of see inflationary the impact not it, the

And it really really your than So ability impact see that manufacturing does efficient we to we’d still to – run it. choppier process. is a like

we think all for where I of, there I to is areas that, So kind in the And I both gross R&D, think to be P&L north I in ‘XX R&D, be SG&A. can an margin efficient forward. we if In beyond, you more said, excited can going ‘XX contribute. can the SG&A move overall to opportunity margin OpEx, certainly we we as areas contribute, for gross of When approaching are. expansion I’m opportunity and continue this of efficient. more think get Frankly, are we about year, can for that margin XX% and have

Matthew Taylor

you. Great. Thanks. there. I’ll it Thank leave

Dan Brennan

Matt. Thanks,

Operator

O'Brien with Sandler. Please ahead. Matt from comes Piper go question next Our

Samantha Kurtz

potentially I Hi. half maybe where Sam second on guess Congrats for that Matt. our little see you a the could heading us This we bit question. a into year is great to the taking touch guidance like on you're we quarter and the again. of most excited would Kurtz tell could on for where and about And upside?

Mike Mahoney

trying results, in Excellent and the the you. Thank Pac and first Yeah. are in Japan taking I'm in the results company broad-based It's to and region. be Asia each you in performance half the saw really as across share U.S. across vague. continued growth China, and Europe excellent

confidence growth lot the momentum driving not of it's region company. and should it, durable one just the in of So investors which give a really

standouts, a of them. there are The number

performance That to XX%. to continues in strong. WATCHMAN continue excess You grow very see well of market

take that potential Pro future next-gen excited trials, couple FLX here. in the of these WATCHMAN category. of market-expanding the read will years And a We little bit continue we're a very in and the of distributable out and the which the share sheets to in of launches about

So that platform well. continues to do very

did and stents, be agents in continues We seeing in that strong reverses some growth launching and to trend of half. the excellent. Neuromod get nice endo, We're in anticipate second euro. We'll coronary coronary We We really that well. which business great Our results better in any PI drug-eluting in our XXXX, a business to U.S. do complex in the business. declining softness saw that had

a it's momentum. continued really, So

Investor some questions at Day we'll what And highlight we today. received of the is

this been growth launch entire third FARAPULSE, has our drivers the We ongoing have in anticipate some the potential which very at WATCHMAN which with business Cryo, length. we with EP quarter and great year, in big discussed momentum of

at Day. launches good just momentum we’ll detail that Investor coming extremely exciting So and out

Samantha Kurtz

so much. Thanks

Operator

question comes from next Miksic Our with Matt go Please Barclays. ahead.

Matthew Miksic

strong and so on Thanks congrats much taking super quarter. a for question Hey. the

into impressive So really breaking double-digits.

welcome. are You

if puts have intermediate on follow the long-term I takes anything goals could. and can conversion cash in Meeting, the just the you now? want also flows there What your you cash and half, and back but share then expectations And first the there? I up sure your at on about more just I'm cash, Analyst flow Dan, what of in been are half? to So sort and

our things on technology programs, to additional assets? so I'd business your have your of going and and You development your many clinical on Thanks. in get efforts but that love invest in sort the find portfolio front and to posture and in

Dan Brennan

Sure.

cash focus go free opportunity both area conversion, Strong for we're So QX. sequentially free here. our with of on point, we one it's has flow cash and quarter, your happy that and an us, year-over-year. flow, forward of on I'm To as area attention, really an improve looking to

As than our doing there's some operating I've over closing time, peers. We're a that of income the is key is a past, pretty which a said key that will of job couple of good and of kind in lower our contributor. GAAP reasons, one of gap be

the cash us think on second in period ratio fair? the a acquisitive then Day, I LRP a improve that think can bit to look it’s -- look And over have. as is pretty and going some us I hamstring for what you area Investor look at would to that we nature do conversion And question that be and on of there, your a we I'd to -- we focus concrete for to will three was give that said, of can but what we years goals improve the next do we And again, is for M&A, forward. something relative

Matthew Miksic

exactly. Yeah, Yeah.

Dan Brennan

Yes.

It’s one still number I allocation one been our priority remarkably our about right? being consistent, tuck-in number It’s strategy the priority. has So capital mean M&A. all high-quality

at to financial conjunction opportunities in with goals. continue We look our

our of We February. Chinese have in stake in company, closed and April, two deals this a in acquisition year. The closed then Apollo Acotec, closed the of acquisition

closed we’ve a couple So this year.

to M&A to one capital continue allocation priority. and our number the that look in remains be space, active We

Matthew Miksic

Thanks congrats. and

Dan Brennan

Thanks, Matt.

Operator

next from Please BTIG. go question Thibault Our ahead. comes Marie with

Marie Thibault

the to on quarter POLARx, ask the question. Cryo Nice morning. Good Hi. thanks catheter. here for wanted I and taking

great I in FARAPULSE, of year. You know half supply have some that dynamics success coming in manufacturing but the with of like to there that the think? And the Europe, it FARAPULSE this U.S. sounds about second happening given will thinking here XX:XX. pretty the replicated it's do same in ease success the the Can U.S.? in launch the for here are you U.S. here, How launch you be of timing that had POLARx

Mike Mahoney

on you. well have we the constraints POLARx well, a is well FARAPULSE, as Japan, extremely are also Yes. Thank as in where not doing indicated. standpoint. doing supply Europe in POLARx you from do quite We selling

So the been team of has well that. ahead

We anticipate So at do some approval the there's in quarter. likely third no limitations point, there.

So the we'll demand. the meet to supply have

is number are We place. very certainly, Cryo have there. in the team And Cryo the users U.S. there's quite And interested in of in substantial a but the commercial doctors market FARAPULSE,

even Some physicians may be looking for on longer-term FARAPULSE. data

that's in years. innovation area seen Cryo any for hasn't coming really nearly decade. market nice a the a in see do we So And an that

differentiating to platform, features. we're and so new it. demand are what excited terms in delivers the had of anxious a And about POLARx we support try Physicians to

the both -- system as FARAPULSE the U.S. have coming So well to it's electrophysiologists. to blessed and as demands really we're Cryo meet our mapping in the of

So launching about excited Cryo. we're

Marie Thibault

good. Very much. Okay. Thanks so

Mike Mahoney

Yeah. Thanks, Marie.

Operator

ahead. Patrick Wood Morgan Our next question from comes Stanley. Please with go

Patrick Wood

you to that any Thanks. on overall. I'd Amazing. happening like Obviously, in for business. around you But that business much details, bit maybe kind if endoscopy, very love details single-use pricing, of obviously just can love sense their a relative a if you Thank share very give more you did giving us volumes could? taking thing. patient any a of the you more detail I'd There's Endo in the lot well question. could quarter. the little

Mike Mahoney

endo the for Thanks question.

Just in We the very see best strong XX% grew one quite and in the the consistent which to procedure And volume global OI a company, the of quarter. very a on broad-based. business, businesses quarters, it's with our contributor is strong portfolio, positive. accretive in margin quarter, did other

the and in that And as oftentimes in the high so I earlier, overall mentioned volume But in certainly waitlist is still, U.S. for would procedure business. arena. Europe quite say that

there. demand strong ongoing expect we So

technologies strategy have you Apollo like we know, (ph) as that now for very The within also so that portfolio many The GESTALT-D are and that platform. differentiated with endo And excited clear leader we about. such also, and we we're is area. Apollo Axios very the in the SpyGlass, a portfolio broad-based within acquisition, offer category (ph) SKUs

to have today, into form seek the So a and Apollo procedure. Japan it which invasive opportunity market, bariatric this high that Certainly, to endobariatric The area. suturing adds patients U.S. in be the capability. endoluminal is a in we less also growth believe will in expand Asia

the portfolio. couples nicely entire And it with

by enjoy contracts our procedure broad-based we Endo business strong portfolio our So that doing supported the and customers with volumes. offer,

that we'll scopes in as well. And to contribute business. innovate to So the growth continue continue

portfolio. it's So across really broad-based that

Patrick Wood

the for appreciate Really details. Thanks it.

Operator

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

Vijay Kumar

the headwinds organic, XXXX Hey, look you tailwinds, big we about comps? perspective, at plus guys. worry Thanks my here, Should the for my question. a one double-digit be a can here, in product minuses and at from could what look number. remind taking outlook you pretty that's 'XX? us, you first just Maybe When fiscal

Mike Mahoney

Yeah.

-- year. about we easy going a comp have X% comps. didn't tough was it's comp We So to 'XX. going into this create It an into good us for

pretty other up So the And too indicated I repeat that's It's what guidance healthy is. comments. won't you momentum. many a broad-based comp. of the

Dan strong So And three-year January growing give X% in that to and year. insights XXXX, Investor obviously we'll a guidance is range will for give Day. guidance some our in LRP comp versus at

we discussed have that this based three-year the we bullish the on about really potentially many on of these current the of today, it the three-year period cardio product which call and many launches, on level out launches coming with opportunity the we're over these next the them differentiated of to momentum cycle to business, we've business. based take And that another that have period a been in up

which the And we of the multiyear is increasing improvement margin balance and also think that the sheet. outlined, margin for opportunity strength Dan us the opportunity benefit a improvement of

we're the all that the versus think I I chapter but say, company, launches bit of next the the more given about to been areas a have year those company, cadence would momentum point excited ago. So a the really of really derisked, of

Vijay Kumar

the of outside any commentary. of Anything helpful we FX, (ph), thinking aware question, and margin think about? VVP operating be leverage when Delaware be of that we Boston kind 'XX? should that's the anything that on at one-offs That's fiscal normal should Dan, on we Understood.

Dan Brennan

we see where FX, when we'll snap line when the that with is Yeah. give we guidance. Obviously,

things comment every to – year. And hard happen happen (ph) then So there's always things that on in and other now. that that VPP

at Mike Investor the what September. XX.X% look upcoming to pretty to And can again, that as that be will north our year think for be our goal for move hit over as we'll prescriptive we continue So said, Day in LRP to -- this we period. do us

Vijay Kumar

Understood. on [indiscernible]. Thanks, guys. Congrats the

Dan Brennan

Thanks.

Operator

Our comes Raymond Please with last from ahead. question go James. Bedford Jayson

Jayson Bedford

Good fitting me thanks for in. morning and

break temporary market touching and versus, Just growth on to what's normalized a catch-up earlier an say, out trying question here.

revenue quarters the here. grown double in You've the in last four of three digits

now So compete? I in is, market is what in question growth do guess my which right you end markets the you think

Mike Mahoney

You've seen others report.

So second than of quarter. some There's bit the markets others the the had are in a healthy. comps tougher -- we

So less we're proud of the growth in quarter. And maybe easier a bit we comp. had had second the we

group, faster growth redefine and we're is we're a of most our -- what served the do. maybe peer further what X%-ish to we We to that's maybe we'll call it believe the market bit have our X% are our we -- the this higher So business would future. units, paid that than still think we markets in said the growing growing range year. But for which in

healthy a it's market. So

lack have a close And -- patient very of time. the an a healthy they and earnings, have the already with customers -- backlog announced hospital have demand, for pulse systems ongoing but big our patient hospitals wait we see we who whenever very that have

from forth, that strong So demand abating. vacation bit we in see some current abating. see which is you'll Oftentimes, don't August very don't coming in so volume anticipate do see the We the support and of a we slowdown the months of in years. But a really continued routine. procedure

Jayson Bedford

Thank you. Helpful.

Lauren Tengler

appreciate the or you interest joining in out for We please hesitate team. reach get Relations follow-ups, to to have question If were if your unable don't your us we today. Investor Scientific. any to to Boston you Thank

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

Operator

at please for August Lauren, today's has until you, presentation. conference everyone available you replay note, code XX:XX in concluded. The using either dialing X-XXX-XXX-XXXX X-XXX-XXX-XXXX be now or by ET. will hour XXXX attending XXXXXXX recording Thank X X, Thank p.m.

disconnect. You may now

Boston Scientific (BSX) 27 Jul 232023 Q2 Earnings call transcript