Medtronic Projects Strong 2027 Growth Amid Heart Device Demand
Medtronic raises fiscal 2027 outlook, citing robust demand for heart devices and new investments.
Medtronic has increased its fiscal 2027 revenue and profit forecasts, driven by a surge in demand for its heart devices used in complex cardiovascular procedures. The company announced this strategic move on Tuesday, highlighting the growing adoption of advanced medical technologies.
Increased Revenue and Profit Forecasts
The medical device giant has adjusted the lower end of its fiscal 2027 adjusted per share profit forecast to $5.94, up from $5.90, while maintaining the upper limit at $6. Additionally, Medtronic now expects annual organic revenue growth to range between 7.25% and 7.75%, an increase from the previous projection of 6.75% to 7.25%.
Geoff Martha, CEO of Medtronic, expressed confidence in the company's performance, citing the strength and breadth of its business segments and the contributions from newer growth platforms. “We’re prioritizing the higher growth segments of medtech,” Martha remarked.
Strategic Investments
In a bid to expand its portfolio, Medtronic has announced an $80 million investment in heart-valve repair device maker Pi-Cardia, with an option to acquire the company for $210 million. Furthermore, it invested $700 million in Cornerstone Robotics, securing rights to distribute a robotic surgical device in select markets outside the United States.
Martha noted the potential for growth in robotic surgery, particularly in emerging markets where penetration remains below 1%. He emphasized that Cornerstone's Sentire device complements Medtronic's existing Hugo system.
Strong Performance in Cardiovascular Segment
Medtronic's cardiovascular segment reported a 19.5% increase in quarterly sales, reaching $3.93 billion. This growth was largely driven by the company’s pulsed field ablation portfolio, which saw an impressive 88% surge. The technology is employed in treating irregular heart rhythms, underscoring the rising demand for such innovative solutions.
For the quarter, Medtronic posted an adjusted per share profit of $1.45 on revenues of $9.76 billion, surpassing analysts’ expectations of $1.39 per share on $9.55 billion in revenue, as per data compiled by LSEG.
Despite these positive results, Medtronic's finance chief, Thierry Pieton, indicated that while the company received tariff refunds that nearly offset the duties paid during the quarter, these have not been factored into future financial outlooks.