Medtronic (MDT) lost ~5% in the premarket on Tuesday after the MedTech giant released its Q3 results for fiscal 2026, reaffirming its full-year earnings outlook that was in line with Street forecasts as the company continues to grapple with the impact of tariffs.
The Irish company reiterated its FY26 outlook, indicating roughly 5.5% YoY of organic revenue growth and projecting diluted non-GAAP EPS of $5.62 - $5.66, which fell short of $5.65 in the consensus at the midpoint.
Medtronic (MDT) said that it continues to project about an $185M headwind from tariffs, and excluding the tariff-related impact, it estimates a ~4.5% growth in diluted non-GAAP EPS, which compares favorably to the ~2.9% YoY growth projected by analysts.
As for Q3 financials, the company posted a double beat with its non-GAAP EPS of $1.36, beating the consensus by $0.02 on $9.0B of revenue, which exceeded Street forecasts by $110M with ~9% YoY growth.
"Q3 marks another strong quarter, delivering 6% organic revenue growth, ahead of guidance, demonstrating the strength of our portfolio," CEO Geoff Martha remarked.
Medtronic's (MDT) Cardiovascular Portfolio drove the topline growth, adding $3.5B in revenue with ~14% YoY growth. In comparison, the Neuroscience and Medical Surgical units brought in $2.6B and $2.2B, ~4% YoY and ~5% YoY growth, respectively.
Meanwhile, MDT's diabetes unit, which is heading for a spinoff this year, added $796M with ~15% YoY growth thanks to double-digit growth in international markets, where the company’s overall revenue climbed ~12% YoY to $4.5B.
MDT posted a ~6% YoY growth in the U.S., adding $4.5B in revenue as its cardiovascular unit generated $1.6B with ~13% YoY growth. However, MDT’s adjusted net income fell ~2% YoY to $1.8B, while its non-GAAP operating margin reached 24.1%, down from 26.2% from the year-ago period.
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