Medtronic beats, ups FY27 organic growth and EPS guidance

 

Medtronic beats Q1 FY27 estimates with EPS $1.45, revenue $9.8B and raises FY27 organic growth and EPS guidance

• Q1 revenue $9.8B, organic +13.7%; underlying growth ~7% after adjusting for extra selling week benefit.
• Adjusted EPS $1.45, $0.06 above guidance midpoint and Street; gross and operating margins up slightly YoY.
• FY27 organic revenue growth guidance raised 50 bps to 7.25–7.75%, with EPS outlook increased to $5.94–6.00.
• FY27 operating profit guided to grow about 10%, with approximately 50 bps margin expansion despite growth reinvestment.
• Cardiac Ablation Solutions grew 88%, topping $2B trailing revenue and expected to grow 2.5–3x the overall market.
• Strong quarter with robust procedural strength across CRM, Cranial & Spinal, Surgical, Pelvic Health and Diabetes franchises.
• Free cash flow strong, with 70% conversion in Q1 and a clear articulated path toward 80%.
• MiniMed diabetes separation targeted by fiscal year-end, expected to lift gross and operating margins by 50–100 bps.
• Agreed to approximately $700M Cornerstone Robotics deal for Sentire surgical robot rights in select markets outside the U.S.
• Partnership with Cornerstone and Pi-Cardia aims to expand Medtronic's soft-tissue robotics and structural heart treatment ecosystems.
• Medtronic secures exclusive global distribution rights from 2027 for Pi-Cardia's FDA-cleared ShortCut TAVR leaflet-modification device.
• Deal includes option to acquire Pi-Cardia for up to about $210M plus earn-outs and up to $80M ShortCut agreement investment.
• Investor focus and concern center on CAS growth sustainability, robotics strategy execution and MiniMed diabetes separation timing and economics.

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