Medtronic Raises 2027 Forecasts Amid Strong Heart Device Demand
Medtronic has increased its fiscal 2027 revenue forecasts, driven by rising demand for heart devices.
Medtronic has revised its financial outlook for fiscal 2027, bolstered by a surge in demand for its heart devices used in complex cardiovascular procedures. The company now anticipates an annual organic revenue growth between 7.25% and 7.75%, an upward revision from its previous estimate of 6.75% to 7.25%.
Investments in Heart and Robotic Technologies
In a strategic move, Medtronic has announced an $80 million investment in Pi-Cardia, a heart-valve repair device maker, with an option to acquire the company for $210 million. Additionally, Medtronic has invested $700 million in Cornerstone Robotics, securing rights to distribute a robotic surgical device in selected markets outside the United States. These investments align with Medtronic's focus on expanding its presence in high-growth segments of the medtech industry.
Financial Performance and Market Confidence
During a post-earnings call, CEO Geoff Martha highlighted the broad performance across Medtronic’s business segments, emphasizing the contributions from new growth platforms. The company has raised the lower end of its fiscal 2027 adjusted per share profit forecast to $5.94 from $5.90, maintaining the upper limit at $6. Quarterly sales in Medtronic’s cardiovascular segment soared 19.5% to $3.93 billion, driven by an 88% growth in its pulsed field ablation portfolio, which treats irregular heart rhythms.
Exploring New Markets
Martha noted the less than 1% penetration of soft tissue robotic surgery in emerging markets, seeing potential for growth with Cornerstone’s Sentire device, which complements Medtronic’s existing Hugo system. The company aims to prioritize segments with large patient pools and significant growth potential.
Medtronic reported an adjusted quarterly per share profit of $1.45 on $9.76 billion in revenue, surpassing estimates of $1.39 on $9.55 billion sales, according to LSEG-compiled data. Chief Financial Officer Thierry Pieton mentioned that the company received tariff refunds that nearly covered the duties paid during the quarter but clarified that future refunds have not been factored into the financial outlook.