Medtronic Increases Fiscal 2027 Forecasts Amid Heart Device Surge
Medtronic raises its 2027 revenue forecast, driven by strong heart device demand and strategic investments.
Medtronic has revised its fiscal 2027 forecasts upwards, reflecting robust demand for its heart devices used in intricate cardiovascular procedures. The company announced an increase in its revenue growth outlook and adjusted its profit forecasts, buoyed by the performance of its heart device segment.
Strong Heart Device Demand Drives Forecast
The medical technology giant now anticipates an annual organic revenue growth between 7.25% and 7.75%, an increase from its previous projection of 6.75% to 7.25%. The lower end of its adjusted per-share profit forecast has also been raised to $5.94, up from $5.90, while the upper limit remains at $6.
CEO Geoff Martha highlighted the comprehensive strength across Medtronic's business units as a key factor in their confidence. “It's not just the strength of the quarter, but the breadth of performance and contributions from new growth platforms,” he stated in a post-earnings call.
Strategic Investments Bolster Growth
Alongside its revised forecasts, Medtronic has announced significant investments to further enhance its portfolio. The company plans to invest $80 million in Pi-Cardia, a heart-valve repair device manufacturer, with an option to acquire it for $210 million. Additionally, Medtronic has invested $700 million in Cornerstone Robotics, which grants them distribution rights for a robotic surgical device outside the U.S.
Martha emphasized the potential of soft tissue robotic surgery, noting its penetration in emerging markets is below 1%. He described Cornerstone’s Sentire device as complementary to Medtronic’s existing Hugo platform.
Cardiovascular Segment Performance
Medtronic’s cardiovascular segment reported a 19.5% increase in quarterly sales, totaling $3.93 billion. This growth is largely attributed to the success of its pulsed field ablation portfolio, designed to address irregular heart rhythms, which saw an 88% surge.
The company’s financial performance exceeded expectations, with an adjusted quarterly per-share profit of $1.45 and revenue of $9.76 billion, surpassing estimates of $1.39 per share on $9.55 billion in sales, according to LSEG-compiled data.
Medtronic’s financial strategy also includes tariff refunds received during the quarter, which nearly offset the duties paid. However, these refunds have not been factored into future projections, according to Finance Chief Thierry Pieton.