Medtronic Ups Fiscal 2027 Outlook Amid Rising Heart Device Demand

Medtronic has revised its fiscal 2027 financial forecasts upward, citing robust demand for its heart devices used in complex cardiovascular procedures. The medical technology giant announced on Tuesday that it has increased the lower end of its adjusted per-share profit forecast to $5.94 from $5.90, while maintaining the upper end at $6. The company also raised its annual organic revenue growth expectations to a range of 7.25% to 7.75%, up from the previous 6.75% to 7.25% projection.

CEO Geoff Martha emphasized the company's confidence in its performance, highlighting the broad contributions from new growth platforms across its business segments. Medtronic is capitalizing on the growing adoption of innovative technologies and a surge in surgical procedures.

Strategic Investments in Pi-Cardia and Cornerstone Robotics

In addition to its revised forecasts, Medtronic announced significant investments in two companies. It will invest $80 million in Pi-Cardia, a maker of heart-valve repair devices, with an option to acquire the company for $210 million. Furthermore, Medtronic has invested $700 million in Cornerstone Robotics, securing rights to distribute a robotic surgical device in select markets outside the U.S.

Martha noted that the penetration of soft tissue robotic surgery in emerging markets is still under 1%, and Cornerstone's Sentire product complements Medtronic's existing Hugo device. The CEO stated that Medtronic is focusing on high-growth segments within the medical technology sector that promise substantial patient pools and market size.

Cardiovascular Segment Drives Growth

Medtronic's cardiovascular segment reported a significant 19.5% increase in quarterly sales, reaching $3.93 billion. This growth was primarily driven by the company's pulsed field ablation portfolio, which saw an impressive 88% growth. Pulsed field ablation is used to treat irregular heart rhythms and has become a key contributor to Medtronic's financial performance.

The company reported an adjusted quarterly per-share profit of $1.45 on revenue of $9.76 billion, surpassing the estimates of $1.39 per share on $9.55 billion in sales, according to data compiled by LSEG.

Medtronic's Chief Financial Officer Thierry Pieton mentioned that the company received tariff refunds that almost covered the duties paid in the quarter. However, these refunds have not been factored into the company's future outlook.