TLDR
- Medtronic reported Q3 revenue of $9.02 billion, beating estimates of $8.91 billion, with 6% organic growth marking its highest in 10 quarters
- Adjusted earnings per share hit $1.36, surpassing analyst expectations of $1.33 per share for the quarter
- Cardiovascular segment sales jumped 13.8% to $3.46 billion, driven by 80% global growth in cardiac ablation solutions and 137% U.S. growth
- Stock fell 2.9% in premarket trading despite the beat as company maintained fiscal 2026 EPS guidance at $5.62 to $5.66
- Neuroscience segment revenue rose 4.1% to $2.56 billion but missed estimates of $2.59 billion
Medtronic delivered a strong third quarter beat on Tuesday but investors sent shares down anyway. The medical technology company posted revenue of $9.02 billion and earnings per share of $1.36. Both numbers topped Wall Street expectations.
Analysts had expected revenue of $8.91 billion and earnings of $1.33 per share. The company’s 6% organic revenue growth marked its highest performance in 10 quarters.
Despite the solid results, the stock dropped 2.9% in premarket trading. The decline came after Medtronic kept its full-year fiscal 2026 earnings guidance unchanged at $5.62 to $5.66 per share.
J.P. Morgan analyst Robbie Marcus noted the maintained outlook raised questions. The company received a 100-basis-point benefit from foreign exchange. The unchanged guidance implies weaker growth in the fourth quarter.
Heart Devices Drive Growth
The cardiovascular segment powered Medtronic’s performance. Sales in this division jumped 13.8% to $3.46 billion. The segment represents nearly 40% of total company revenue.
Cardiac ablation solutions saw explosive growth. The business grew 80% globally and 137% in the United States. Pulsed field ablation technology drove these gains.
This technology uses high-energy electric pulses to destroy targeted heart tissues. It reduces the frequency of abnormal heart rhythms. Doctors are rapidly adopting this minimally invasive approach.
Transcatheter aortic valve replacement devices also contributed to growth. These products offer another minimally invasive option for treating heart conditions.
Mixed Results Across Other Segments
The neuroscience segment posted more modest gains. Revenue rose 4.1% to $2.56 billion. The division makes spinal implants and software. However, this result fell short of the $2.59 billion estimate.
The medical surgical portfolio grew 4.9% to $2.17 billion. The diabetes business expanded 14.8% to $796 million. These results showed continued momentum across Medtronic’s product lines.
CEO Geoff Martha highlighted the company’s strategy. “By unlocking new markets and investing in high-growth opportunities, we are accelerating performance across the company,” he said.
Medtronic operates in a favorable environment. Patients are seeking more medical procedures. Health insurers are reporting higher medical loss ratios. This indicates increased healthcare utilization.
Technological advances are expanding treatment options. Physicians are embracing new devices and techniques. The medtech industry is benefiting from these trends.
Johnson & Johnson reported similar strength in its latest quarter. The company’s medtech sales grew 7.5% year-over-year. Its electrophysiology segment, which includes heart devices, performed particularly well.
Medtronic maintained its full-year organic revenue growth outlook at approximately 5.5%. The guidance includes a potential $185 million impact from tariffs.
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