Q4 2026 Medtronic PLC Earnings Call

June 3, 2026

Speaker #1: Welcome to Juncos Facility in Puerto Rico. This is the facility that we are manufacturing Altaviva, the new pelvic health product. Altaviva is a tiny product that is going to be implanted in the ankle, and it is for patients with urinary incontinency.

Speaker #1: Quality is a driving force in our production floor. Every time that we manufacture the product, we are thinking of the patient. We are going to approach the gowning room where the magic begins.

Speaker #1: We need to make the product in a controlled environment to make sure that the product that we are sending out for the patients is meeting the specification in order to provide the right therapy for the patients.

Speaker #1: So this is the first step of Altaviva. So in here, we receive the main parts of Altaviva, which is the feed-through. That feed-through is the connection between the electrode and the internal components that actually lead or drive the therapy to the patients.

Speaker #1: We're going to be welding together those feed-through wires to the circuitry of the device. When it comes back around, it's going to be nice and engraved with the Medtronic logo, the serial number, and the brand name for the part.

Speaker #1: Now we're going to the final part of the manufacturing assembly. These testers are going to be handling the final functional testing of the parts.

Speaker #2: My father got an ICD from here. You never know when a family or a relative is going to end up with a product from here.

Speaker #2: So not only the operators, but the engineers, technicians. Everyone. We are thinking of patients all the time.

Speaker #3: Urge urinary incontinence is something that no one wants to talk about. But since getting the Altaviva implant, I feel like a new person.

Ingrid Goldberg: as reported basis. I'll share references on its revenue and year-over-year basis and compare our Q4 to our competitors' Q1. Reconciliations of all non-GAAP financial measures can be found in our earnings press release or on our website at investorrelations.medtronic.com. Finally, our EPS guidance does not include any charges or gains that will be reported as non-GAAP adjustments to earnings during the fiscal year. With that, I am now pleased to hand it over to Geoff.

Speaker #4: We're busy people. We like doing a lot of things. We just try to have a busy retirement lifestyle.

Speaker #3: I play golf when I can. Writing poetry, fish when I can. You can have this joyous look but inside you know I've got this issue.

Speaker #3: It's been for years, I'd say over 20 years, dealing with it.

Geoff Martha: Okay. Thanks, Ingrid, and good morning, everyone, and thank you for joining us. In our Q4 of fiscal 2026, we delivered $9.8 billion in revenue, up 9.9% on a reported basis and 6.6% organically. For the full fiscal year, we delivered $36.4 billion in revenue, up 8.4% reported and up 5.8% organically, marking our strongest top-line performance in 10 years. On the bottom line, we delivered Q4 and FY26 adjusted EPS of $1.55 and $5.53 respectively, ahead of expectations and reflective of our commitment to operational rigor as we invest in durable growth. These results represent the compounding impact of deliberate choices we've made across strategy, operations, and culture. We saw continued strong execution across our largest foundational businesses like CRM, CST, and surgical. We made material progress on our highest growth platforms.

Speaker #4: He was always going to the restroom. I mean, constantly. It was pretty bad. He was always so frustrated.

Speaker #3: When you have to go or when you're rushing to go or when there's incontinence, it's like, why? Why me? Why do I always have to go to the bathroom?

Speaker #3: It's depressing. It brings out a sense of anxiety. Because you know what's about to come, and then when it does come, you know that you have to change what you're doing or stop what you're doing because you have to go.

So, for the full fiscal year, we delivered $36.4 billion in revenue, up 8.4% reported and up 5.8% organically.

Marking our strongest topline performance in 10 years.

Speaker #3: And especially if I'm driving, your thoughts always are on, here I go again. Here I go again. Why am I the only one that has to do this?

And on the bottom line, we delivered Q4 and FY26 adjusted EPS.

Speaker #3: As men, we minimize everything because if it's not drastically changing your life, then just deal with it. We don't have to suffer in silence.

of $155 million and $553 million, respectively, ahead of expectations and reflective of a commitment to operational rigor. As we invest in durable growth,

Speaker #3: And it wasn't until later in life that I was able to seek treatment. Their initial treatment was through, you know, the pills. And you take that, but then you're like, man, these side effects are crazy.

These results represent the compounding impact of delivered choices we've made across strategy, operations, and culture.

Speaker #3: I mean, it dried me out. It just messed up my life. And then I don't want that anymore. It would lead me to where I'm at today is, you know, they introduced, hey, we have this device.

We saw continued strong execution across our largest foundational businesses, like CRM, CST, and Surgical.

Speaker #3: And for me, it was a no-brainer. You don't stop and think about what they're going to do or how they're going to do it.

Geoff Martha: We marched toward leadership in CAS, advanced Symplicity and Hugo, and built momentum in Altaviva and Stealth Access, all while supporting our uniquely deep pipeline of innovation. In Q4, we advanced our commitment to further focus the company, deploying capital in line with our capital allocation priorities and meaningfully increasing our investments in M&A, ventures, and partnerships. I am incredibly proud of our teams. Through a dynamic macro environment, we have executed, and we've executed with discipline to deliver an excellent fiscal 2026 that will continue into fiscal 2027. Now let's turn to the details of our fiscal Q4, beginning with cardiac ablation solutions. Look, CAS delivered another outstanding quarter with 78% worldwide growth and gaining an additional 8 points of US share. PFA saw exceptional global growth of 145%, with Sphere-9 continuing to demonstrate broad versatility. We're still in the early innings for Affera.

Speaker #3: If this works, it's better because if I can reduce that at any cost, I'll do it. And it's been for me night and day.

Speaker #3: It was a very easy procedure. There's a small incision, and it's placed right behind your ankle. And before I know it, she was stitching it up.

And we made material progress on our highest-growth platforms. We marched toward leadership in CAS, Advanced Simplicity, and Hugo, and built momentum in ALVIA and Stealth Access, all while supporting our uniquely deep pipeline of innovation.

Speaker #3: And I'm like, that's it? You're in and out. I'm not worried about leakage. I'm not worried about, you know, the urgency anymore. And I'm not worried about where I'm at.

In Q4, we advanced our commitment to further focus, deploying capital in line with our capital allocation priorities and meaningfully increasing our investments in M&A.

Ventures and Partnerships.

And I am incredibly proud of our teams.

Speaker #3: So now I can enjoy the moment without thinking or worrying about this is going to come up and interfere with what I'm doing right at the time.

Through a dynamic macro environment, we have executed—and we've executed with discipline—to deliver an excellent fiscal '26 that will continue into fiscal '27.

Speaker #4: I don't even notice it now because he never talks about going to the bathroom. It's nothing like it used to be.

Speaker #3: Everything was affected before. Now there's a new me that doesn't have that problem. It's a game changer. It's there. And I don't even really know it.

And now, let's turn to the details of our fiscal fourth quarter, beginning with Cardiac Ablation Solutions.

Speaker #3: But it means a lot as a man, as a person to feel that there is something. There's a remedy that's minimally invasive, doesn't stop the things that you do in life, but will help you the Altaviva implant helped me become me again.

Well, CAST delivered another outstanding quarter, with 78% worldwide growth and gaining an additional 8 points of U.S. share.

PFA saw exceptional global growth of 145%.

With Sphere 9, continuing to demonstrate broad versatility.

Geoff Martha: In the US, we increased our installed base by 40% sequentially, and we see significant runway for continued expansion. Globally, we're now rolling out Prism-2, our next generation mapping software. Prism-2 unlocks meaningful benefits, including improved navigation using hybrid impedance and magnetic mapping to better visualize non-sensor-based catheters. In Q4, we launched Sphere-9 in Japan, where we expect to extend our market leadership. We also secured FDA approval for our US VT pivotal trial, which we aim to begin enrolling in H1 of FY27. This is an important population due to the complexity of these potentially life-threatening arrhythmias that are often really difficult to treat.

And we are still in the early innings for Affera in the US. We increased our installed base by 40% sequentially.

And we, uh, see significant runway for continued expansion.

Globally, we're now rolling out Prism 2, our next-generation mapping software. Prism 2 unlocks meaningful benefits, including improved navigation using hybrid impedance and magnetic mapping to better visualize non-sensor-based catheters.

Speaker #1: When our competition says, oh, you haven't been innovating, they haven't been paying attention. We've been innovating the whole time.

Speaker #3: It's not just a product. It really does change the way people do surgery, and it changes the patients' lives for the better.

As we look ahead, we're expanding our entire EP ecosystem, expanding geographically into new indications, and with an exciting, exciting cadence of new innovation.

Speaker #1: Think about what a neurosurgeon does. Why not use the precise instrument, particularly for the procedure in which you're operating on the most complex structure of the universe?

In Q4, we launched Fear 9 in Japan, where we expect to extend our market leadership.

Speaker #3: So when I first saw the early version of what would become the cell station, I was impressed. I mean, it was one of those things that when neurosurgeons saw it for the first time, they thought it was a miracle.

We also secured FDA approval for our USDT pivotal trial, which we aim to begin enrolling in the first half of FY27. This is an important population due to the complexity of these potentially life-threatening issues.

Speaker #3: And our booth at our first exhibit shows always had a line. It honestly went from a curiosity to something that's become incredibly useful. You don't have to take my word for that.

Geoff Martha: Now, further strengthening our EP offering is our Sphere-360 catheter, the only rotation-free, large tip, single-shot catheter that's available. Sphere-360 is CE marked and launching in Europe. Early physician feedback is really strong, and our US pivotal trial is enrolling swiftly. As you saw in our additional press release this morning, we are continuing to invest in a fully integrated EP ecosystem with two targeted investments in ICE catheter technology that will give physicians real-time visualization of the heart. This will further enhance the Affera platform over time to extend our capabilities. Now, through innovation, purposeful investment, and global execution, we plan to completely surround the electrophysiology space and offer patients and physicians a more complete end-to-end set of EP solutions. Next, I'd like to share our progress with Symplicity Spyral, which is a novel one-time, minimally invasive approach to treat hypertension.

and that are often really difficult to treat.

Now, further strengthening our EP offering is our Sphere 360 catheter.

Speaker #3: You can just look around the world and see how many lives have been impacted by stealth. You'd probably put the space back decades without stealth.

The only rotation-free, large-tip, single-shot catheter that's available.

Here, 360 is CE marked and launching in Europe.

Early physician feedback is really strong, and our U.S. pivotal trial is enrolling swiftly.

Speaker #1: There's no other technology offering that combines planning navigation robotics in the way it does in scalable different modules for site of service, the way that access does.

Positions real-time visualization of the heart.

Speaker #3: We're going to do things that people didn't think existed.

Speaker #1: We are the trailblazers. We are the innovators. We built this market. If it weren't for Medtronic, this journey wouldn't be what it is. In surgery, your skill and intuition are the epicenter of a patient's outcome.

This will further enhance the Affera platform over time to extend our capabilities.

Now, through innovation.

Purposeful investment and global execution. We plan to completely surround the electrophysiology space and offer patients and physicians a more complete end-to-end set of EP solutions.

Next, I'd like to share our progress with Simplicity Spiral, which is a novel one-time, minimally invasive approach to treat hypertension.

Geoff Martha: Hypertension represents a massive unmet need. Despite the use of multiple medications, roughly 18 million people still live with the uncontrolled hypertension in the US alone. Our Symplicity physician finder now spans 200 doctors across more than 300 accounts, connecting patients with physicians as demand grows. We've also seen a significant uptick in prior authorization approvals, and since the NCD, we have doubled average weekly procedure volumes. Now, Symplicity is annualizing at $100 million. At CRT this year, we presented late-breaking, long-term data reinforcing the clinical outcomes of RF renal denervation. In over 2,000 patients, Symplicity delivered sustained mean systolic blood pressure reductions of 13.3 and 18.1 milligrams of mercury in ambulatory and in-office settings at three years respectively, with 90% of patients achieving a meaningful benefit.

Hypertension represents a massive unmet need.

Now, despite the use of multiple medications, roughly 18 million people still live with uncontrolled hypertension in the U.S. alone.

Speaker #1: Now, your expertise is fully matched by a surgical system that works with you. Precisely. Instinctively. Seamlessly. Backed by decades of industry-leading innovation, optimized for familiar and flexible workflows with real-time accuracy you can rely on.

Our simple physician finder now spans 200 doctors across more than 300 accounts.

Connecting patients with physicians as demand grows.

We've also seen a significant uptick in prior authorization approvals, and since the NCD, we have doubled average weekly procedure volumes.

Speaker #1: Designed to elevate. Built to expand. Allowing you to operate at the highest level. When surgery is more connected, care becomes more complete. Redefining what's possible for every patient.

And now Simplicity is annualizing at $100 million.

At CRT this year, we presented late-breaking long-term data reinforcing the clinical outcomes of our renal denervation.

Speaker #1: A new era of surgery starts here. Innovation revolves around a new access. Stealth access.

In over 2,000 patients, Simplicity delivered sustained mean systolic blood pressure reductions of 13.3.

Geoff Martha: As a reminder, a 10-point reduction in BP is proven to show a greater than 20% reduction in major cardiovascular events like heart attack, stroke, and heart failure. This is critical and underscores the impact of Symplicity on patients and the healthcare system itself. Importantly, we stand apart as the proven platform in a category with enormous unmet need, and we intend to lead it. We are confident in the foundation we've established with robust and growing clinical evidence, a broad label, expanding reimbursement, growing demand from both physicians and patients. We are well-positioned and in the early stages of this ramp to redefine the standard of care in a historically drug-based setting with a new option for managing hypertension. We are also starting to see meaningful impact from Hugo, our surgical robotics system.

And 18.1 milligrams of mercury in ambulatory and in-office settings at 3 years, respectively, with 90% of patients achieving a meaningful benefit.

And as a reminder, a 10-point reduction in BP is proven to show a greater than 20% reduction in major cardiovascular events, like heart attacks, stroke, and heart failure.

So, this is critical and underscores the impact of simplicity on patients and the health care system itself.

Importantly, we stand apart, being a proven platform in a category with enormous unmet need.

And we intend to lead it.

We are a foundation we've established with robust and growing clinical evidence—a broad label expanding reimbursement from both physicians and patients.

We are well positioned and in the early stages of this ramp to redefine the standard of care in a historically drug-based setting, with a new option for managing hypertension.

Now, we're also starting to see meaningful impact from Hugo, our surgical robotic system.

Geoff Martha: Our worldwide procedure volume growth is 2 to 3x the market, and utilization is increasing. Last quarter, we launched Hugo for urology in the United States, placing systems at leading institutions and treating our first patients. Feedback from surgical teams has been positive, both in terms of their experience and early clinical outcomes. We are pleased to announce that in late April, we submitted to the FDA for 510(k) clearance for general surgery and gynecologic indications, as well as for our LigaSure RAS vessel sealer. We also recently received FDA clearance for our ProGrip Advanced, a new mesh optimized for robotic-assisted ventral hernia repair procedures. Our touch surgery digital ecosystem, well, it continues to represent a clear advantage, with over 1,400 installations, up 30%+ sequentially. We are complementing our strong foundation with data and analytics driving a more precise, intelligent, and a predictable future in surgery.

Our worldwide procedure volume growth is 2 to 3 times. The market and utilization are increasing.

Speaker #5: Having multiple different platforms and modular, and then a non-modular is really exciting.

Speaker #6: The difference from the previous systems is that this is very flexible. And therefore, the modular system allows to pick and choose the components you want to use.

Last quarter, we launched Hugo for Urology in the United States. Facing systems, at least in treating, our first feedback from surgical teams has been positive—both in terms of their experience and early clinical outcomes.

Speaker #6: It gives us a lot of customization to the surgeon according to their patient and the requirements.

We are pleased to announce that in late April, we submitted to the FDA for 510(k) clearance for general surgery and gynecologic indications as well, as for our Ligasure RAS vessel sealer.

Speaker #7: My name is Danny Cash. And this is my wife, Teresa. Motorcycles snowmobiles jet skis side by sides we travel and do adventures every chance we get.

We also recently received FDA clearance for our ProGrip Advanced, a new mesh optimized for robotic-assisted ventral hernia repair procedures. And our Touch Surgery digital ecosystem continues to represent a clear advantage, with over 1,400 installations, up 30% plus sequentially.

Speaker #7: When you have high blood pressure, you just don't feel well. You don't get enthused to go out and do an adventure. I took medications and it was a let's try this and see how that affects you.

We are complementing our strong foundation with data and analytics, driving a more precise, intelligent, and predictable future in surgery.

Geoff Martha: Digital is creating real value in the OR, and we are investing in innovating to lead in this space. We are building our robotics program deliberately. We are driving utilization and procedure growth globally, making steady progress in the United States, and investing to strengthen our broader surgical franchise over time. Hugo is having an impact on our med surg portfolio, and we are pleased with the early progress. Now moving to Altaviva. Momentum here continues to build, and we are encouraged by the strong physician feedback and early patient demand. Altaviva redefines what is possible for patients with urge urinary incontinence. With same-day activation, up to 15 years longevity, and full-body MRI access while the device remains on, patients can start therapy sooner and live life with fewer disruptions. We've trained nearly 1,000 physicians since launch, and that investment is starting to translate into commercial momentum.

Digital is creating real value in the OR, and we are investing in innovating to lead in this space.

We are building our robotics program deliberately.

Speaker #7: So it was a couple of years of trial and error. And taking the medications over and over just became a burden.

Speaker #8: And he was struck when he had side effects. He had the flushing, the headaches.

We are driving utilization and procedural growth globally, making steady progress in the United States, and investing to strengthen our broader surgical franchise over time.

Speaker #7: My doctor recommended the simplicity blood pressure procedure in order to not have to take any additional medicines, to control my blood pressure. It was a simple procedure.

Hugo is having an impact on our Med Surg portfolio, and we are pleased with the early progress.

Now, moving to Alta Viva, momentum here continues to build, and we are encouraged by the strong physician feedback and early patient demand.

Speaker #7: I came home and took it easy for a couple of days. And then I was good to go.

Speaker #8: He's thankful that he was able to get the simplicity procedure and that that has not slowed him down. Any adventure, he wants to do it.

Ultra Viva redefines what is possible for patients with urge urinary incontinence, with same-day activation.

Speaker #7: I'm getting older every day. And I want to enjoy every day that I have. The procedure has been extremely beneficial and my ability to stay young and do adventurous things.

Full body MRI access while the device remains on.

patients and start therapy sooner, and live life with fewer disruptions.

Speaker #7: There's plenty of time later to sit around. But right now, I want to go, go, go.

We've trained nearly 1,000 physicians since launch, and that investment is starting to translate into commercial momentum.

Geoff Martha: Sequentially, active implantors are up three times, and patients treated are up 2.5 times. Importantly, as physicians gain more experience and move through prior authorization more swiftly, implants are accelerating. Finally, we executed our focused portfolio strategy. In early March, we completed the MiniMed IPO, establishing it as a standalone publicly traded company. We also advanced our M&A and venture initiatives, targeting higher growth segments to accelerate innovation in markets where we have a right to win. In our coronary portfolio, we closed on the CathWorks transaction. CathWorks' FFRangio system uses a combination of AI and advanced computational science to improve decision-making in the cath lab. The company recently presented positive 1-year data from the ALL-RISE trial validating FFRangio as a non-invasive technology poised to disrupt the gold standard traditional wire-based FFR, which is a $1 billion segment growing in the low double digits.

Sequentially active implanters are up three times, and patients treated are up two and a half times.

Importantly, as physicians gain more experience and move through prior authorization more swiftly, implants are accelerating.

Finally, we executed our focused portfolio strategy.

In early March, we completed the MiniMed IPO, establishing it as a standalone, publicly traded company.

We also advanced our M&A and venture initiatives, targeting higher-growth segments to accelerate innovation in markets where we have a right to win.

Speaker #9: Good morning. And welcome to our fiscal '26 fourth quarter earnings webcast. I'm Ingrid Goldberg, head of Medtronic Investor Relations. I'm joined by Jeff Martha, chairman and chief executive officer in Thierry Piton, chief financial officer.

In our Coronary portfolio, we closed on the CathWorks transaction. The CathWorks FFRangio system uses a combination of AI and advanced computational science to improve decision-making in the cath lab.

Speaker #9: Jeff and Thierry will provide comments on the results of our fourth quarter, which ended on April 24, 2026, and our outlook for fiscal year '27.

Speaker #9: After our prepared remarks, we'll take questions from the sell-side analysts to cover the company. Earlier this morning, we issued a press release discussing our quarterly results and several financial schedules.

The company recently presented positive, one-year data from the Allrise trial, validating FFR angio as a non-invasive technology poised to disrupt the gold standard, traditional wire-based FFR, which is a $1 billion segment growing in the low double digits.

Geoff Martha: We announced plans to acquire Scientia and SPR Therapeutics, as well as investments in Beluga Medical and CardiAQ. Scientia will meaningfully expand our neurovascular platform with differentiated guidewire technologies for stroke, enabling every neurovascular procedure to start with Medtronic. SPR Therapeutics for PNS will build out our portfolio of chronic pain management therapies. Beluga Medical and CardiAQ will advance development of next-generation ICE catheters that will further advance our EP toolkit. In our venture portfolio, we invested in emerging technologies, including Pulnovo, a first-of-its-kind minimally invasive system designed to address pulmonary artery denervation. We entered into a distribution agreement with Merit Medical for ViaVerte, which brings an FDA-cleared solution for chronic vertebrogenic back pain. Both of these transactions will expand our reach into new and high-growth adjacencies where we hold leadership positions.

Speaker #9: We also posted an earnings presentation that provides additional details on our performance. The presentation can be accessed in our earnings press release or on our website at investorrelations.medtronic.com.

We announced plans to acquire Scientia and SPR Therapeutics, as well as investments in Beluga Medical and CardioAct.

Speaker #9: During today's program, many of our statements will be forward-looking and actual results could differ materially as explained in our SEC filings. We undertake no obligation to update any forward-looking statements.

Scientia will meaningfully expand our neurovascular platform with differentiated guidewire technologies for stroke, enabling every neurovascular procedure to start with Medtronic.

SPR Therapeutics for PNS will build out our portfolio of chronic pain management therapies.

Speaker #9: Unless otherwise stated, all comparisons are on a year-over-year basis and revenue comparisons are made on an organic basis, which excludes the impact of foreign exchange, prior year revenue from the divestiture of deductible obesity clinic, also known as NOK, and fourth quarter revenue.

and Beluga medical and

will advance development of next-generation ICE catheters that will further advance our EP toolkit.

Speaker #9: In the current and prior year reported as other. References to sequential revenue changes compared to the third quarter of fiscal '26 and are made on an as-reported basis.

In our Venture portfolio, we invested in emerging technologies, including Ponovo, a first-of-its-kind minimally invasive system designed to address pulmonary artery denervation.

Speaker #9: All share references on a revenue and year-over-year basis and compare our fourth fiscal quarter to our competitors' first calendar quarter. Reconciliations of all non-gap financial measures can be found in our earnings press release or on our website, at investorrelations.medtronic.com.

And we entered into a distribution agreement with Merit Medical.

For Via Verte, which brings an FDA-cleared solution for chronic fatigue and back pain.

Speaker #9: And finally, our EPS guidance does not include any charges or gains that will be reported as non-gap adjustments to earnings during the fiscal year.

Now, both these transactions will expand our reach into new and high-growth adjacencies, where we hold leadership positions.

Geoff Martha: These investments are deliberate and tightly aligned to our strategy of reinforcing leadership positions, building scalable ecosystems, and extending our reach in attractive markets. Together, these meaningful tuck-in investments position us to drive sustainable growth for the near and the long term. These are just a few highlights from the quarter. Looking across the business, multiple operating units contributed to the strength in Q4, like CST with Stealth Access or CRM with OmniaSecure and Micra, and many others, which Thierry will cover in more depth. To close, I want to start with thanking our teams, not only for delivering a strong year, but embracing the changes that have enabled this performance. In a world with many moving pieces, we are executing, we are delivering.

Speaker #9: With that, I am now pleased to hand it over to Jeff.

Speaker #10: OK. Thanks, Ingrid. And good morning, everyone. And thank you for joining us. In our fourth quarter of fiscal 2026, we delivered $9.8 billion in revenue, up 9.9% on a reported basis, and 6.6% organically.

These investments are deliberate and tightly aligned to our strategy of reinforcing leadership positions, building scalable ecosystems, and extending our reach in attractive markets.

Together, these meaningful tuck-in investments position us to drive sustainable growth for the near and the long term.

Speaker #10: So for the full fiscal year, we delivered $36.4 billion in revenue, up 8.4% reported, and up 5.8% organically. Marking our strongest top-line performance in 10 years.

Now, these are just a few highlights from the quarter.

Looking at the business, multiple operating units contributed to the strength in Q4.

Like CST with Stealth Access, or CRM with Omnia—secure and micro.

Speaker #10: And on the bottom line, we delivered Q4 and FY '26 adjusted EPS of $1.55 and $5.53, respectively. Ahead of expectations, and reflective of our commitment to operational rigor as we invest in durable growth.

And many others, which Terry will cover in more depth.

so, to close

I want to start by thanking our teams.

Not only for delivering a strong year, but for embracing the changes that have enabled this performance.

In a world with many moving pieces,

We are executing.

Geoff Martha: We are delivering on our strategic priorities and accelerating access to life-changing therapies, all while creating meaningful value for patients, for physicians, for healthcare systems, and for our shareholders. Now with that, I'm going to turn it over to Thierry, who's going to walk through the financial results of both the quarter and the full year before turning to guidance. Thierry?

Speaker #10: These results represent the compounding impact of deliberate choices we've made across strategy, operations, and culture. We saw continued strong execution across our largest foundational businesses, like CRM, CST, and surgical.

We are delivering. We are delivering on our strategic priorities and accelerating access to life-changing therapies, all while creating meaningful value for patients.

For Physicians.

For Health Care Systems.

and for our shareholders,

Speaker #10: And we made material progress on our highest growth platforms, we marched toward leadership in CAS, advanced simplicity and HUGO, and built momentum in Altiviva and Stealth Access.

With that, I'm going to turn it over to Terry, who's going to walk through the financial results of both the quarter and the full year before turning to you guys. Terry.

Thierry Piéton: Hey, thanks, Geoff. Hello, everyone. I appreciate you joining today. Let's start with cardiovascular, which delivered 10% revenue growth this quarter, led by 14% in the US and 7% in international markets. Driving this performance was 78% growth in CAS, including 124% in the US. In a $14 billion market that grew about 20% in Q4, we're now annualizing over $2 billion in revenue and are on track to reach $2 billion trailing in Q1 of fiscal year 2027. Cardiac rhythm management delivered 5% growth in both US and international markets. Defibrillation delivered mid-single-digit growth, including high teens in ICD and mid-60s in EV-ICD. We saw strong momentum in the recently launched OmniaSecure Defibrillation lead following our indication expansion that allows for conduction system pacing.

Okay, thanks Jeff, and hi everyone. I appreciate you joining today.

Speaker #10: All while supporting our uniquely deep pipeline of innovation. In Q4, we advanced our commitment to further focus the company, deploying capital in line with our capital allocation priorities and meaningfully increasing our investments in M&A, ventures, and partnerships.

Let's start with Cardiovascular, which delivered 10% revenue growth this quarter, led by 14% in the U.S. and 7% in international markets.

Driving the performance, with 78% growth, including 124% in the U.S.

Speaker #10: And I am incredibly proud of our teams. Through a dynamic macro environment, we have executed and we've executed with discipline to deliver an excellent fiscal '26 that will continue into fiscal '27.

In our $14 billion market that grew about 20% in Q4, we're now analyzing over $2 billion in revenue and are on track to reach $2 billion trailing in the first quarter of this fiscal year '27.

Speaker #10: And now, let's turn to the details of our fiscal fourth quarter. Beginning with cardiac ablation solutions. Look, CAS delivered another outstanding quarter with 78% worldwide growth, and gaining an additional 8 points of US share.

Thierry Piéton: Cardiac pacing therapies delivered mid-single-digit growth, driven by mid-teens in Micra and high teens in the SelectSecure 3830 lead for CSP. Turning to structural heart, performance in the quarter was flat. We saw strong international performance while the US was softer, in part due to the low-risk data. We're encouraged, though, by the trajectory we've seen in the field, as weekly US procedure volumes have stabilized over the last eight weeks. Structural heart clearly remains a strategic priority for us, with internal programs in mitral and tricuspid replacement and targeted external investment in TAVR, including Anteris, paving the way forward. Coronary declined in the quarter but was offset by strength in renal denervation, as described by Geoff. Importantly, we saw clear acceleration of Symplicity in the back half of the year. We're pleased to see the sequential lift and feel well-positioned to drive momentum going forward.

Speaker #10: PFA saw exceptional global growth of $145%, with Sphere 9 continuing to demonstrate broad versatility. And we are still in the early innings for Afera.

Driven by mid-teens in Micra and high teens in the Select Secure 3830 lead CSP.

Speaker #10: In the US, we increased our installed base by 40% sequentially. And we see significant runway for continued expansion. Globally, we're now rolling out Prism 2, our next-generation mapping software.

The structural heart performance in the quarter was flat. We saw strong international performance, while the U.S. was softer, in part due to the lower data.

We're encouraged, though, by the trajectory we've seen in the field, as weekly U.S. procedure volumes have stabilized over the last eight weeks.

Speaker #10: Prism 2 unlocks meaningful benefits, including improved navigation using hybrid impedance and magnetic mapping to better visualize nonsensor-based catheters. As we look ahead, we're expanding our entire EP ecosystem.

Structural heart clearly remains a strategic priority for us, with internal programs in mitral and tricuspid replacement and targeted ex-TAVR. External investment in TAVR, including Anteris, is paving the way forward.

Speaker #10: Expanding geographically, into new indications and with an exciting cadence of new innovation. In Q4, we launched Sphere 9 in Japan, where we expect to extend our market leadership.

Coronary declined in the quarter, but was offset by threatening renal denervation as described by Jeff.

Importantly, we saw clear acceleration of Simplicity in the back half of the year.

Speaker #10: We also secured FDA approval for our US VT pivotal trial, which we aim to begin enrolling in the first half of FY '27. This is an important population due to the complexity of these potentially life-threatening arrhythmias that are often really difficult to treat.

We're pleased to see the sequential lift and feel, well, positioned to drive momentum going forward.

Thierry Piéton: Peripheral vascular health delivered low single-digit growth. Cardiac surgery was up mid-single digit. Moving to neuroscience. Our position in neuroscience is strong. We have the most comprehensive portfolio and are the number 1 player and category leader across each of our segments. We're investing across the portfolio to advance pipeline innovation and accelerate long-term growth. This quarter, we delivered 3% revenue growth globally, driven by 6% in international markets. Cranial and spinal technologies was up 3% in both US and international markets. Core spine gained share this quarter, growing 6% on continued ModuLeX expansion and distributor conversions. In neurosurgery, results improved sequentially, supported by low double-digit growth in navigation following the launch of Stealth Access late in the quarter. Stealth Access platform is an important growth driver for our CST business. The early commercial launch is progressing well.

Finally, peripheral vascular, Health delivered, low single digit growth and cardiac surgery was up mid single digit.

Speaker #10: Now, further strengthening our EP offering is our Sphere 360 catheter, the only rotation-free large tip single-shot catheter that's available. Sphere 360 is CE-marked and launching in Europe.

Moving to Neuroscience our position. In Neuroscience is strong. We have the most comprehensive portfolio and are the No 1 player and category leader across each of our segments.

We're investing in a portfolio to advance 59 Innovation and accelerate long-term growth.

Speaker #10: Early physician feedback is really strong. And our US pivotal trial is enrolling swiftly. And as you saw in our additional press release this morning, we are continuing to invest in a fully integrated EP ecosystem with two targeted investments in ICE catheter technology that will give physicians real-time visualization of the heart.

This quarter, we delivered 3% revenue growth globally, driven by 6% in international markets.

Cranial and Spinal Technologies was at 3% in both U.S. and international markets. Corresponding gain share this quarter grew 6%, on continued ModuLex expansion and distributor conversions.

Speaker #10: This will further enhance the Afera platform over time, to extend our capabilities. Now, through innovation, purposeful investment, and global execution, we plan to completely surround the electrophysiology space and offer patients and physicians a more complete end-to-end set of EP solutions.

In Neurosurgery, results improved sequentially, supported by low double-digit growth in navigation, following the launch of staff access later in the quarter.

Staff access platform is an important growth driver for RCST business.

Thierry Piéton: Physician feedback has been very positive. Sales are off to a very strong start. This quarter, we achieved FDA clearance across spine, cranial, and ENT indications, as well as CE mark for spine and cranial, broadening the platform's reach across our portfolio. Look, Stealth is a force multiplier, driving pull-through across planning, robotics, and our broader AiBLE ecosystem. It promotes the adoption of robotics in spine surgery, creates efficiencies that allow more physicians to integrate it without disrupting workflow. All of this makes our install base stickier over time. With robotics penetration still in the high single digits, we see significant runway ahead. Specialty therapies delivered 3% growth. Neurovascular was up 6%, driven by 11% growth in hemorrhagic, including healthy adoption in Neuroguard and RTs. We are actively investing in neurovascular, as evidenced also by our planned Scientia acquisition.

The early commercial launch is progressing. Well, physician feedback has been very positive and sales are off to a very strong start.

Speaker #10: Next, I'd like to share our progress with Simplicity Spiral, which is a novel one-time minimally invasive approach to treat hypertension. Hypertension represents a massive unmet need.

This quarter, we achieved FDA clearance across spine, cranial, and the NT indications as well as CE Mark for spine and cranial, broadening the platform's reach across our portfolio.

Speaker #10: Now, despite the use of multiple medications, roughly 18 million people still live with the uncontrolled hypertension in the US alone. Our Simplicity physician find are now spans 200 doctors across more than 300 accounts.

LOOKS DEL is a force multiplier, driving pull-through across planning Robotics and our broader Aible ecosystem. It promotes the adoption of Robotics in spine surgery and creates efficiencies that allow more physicians to integrate it without disrupting workflow.

Speaker #10: Connecting patients with physicians as demand grows. We've also seen a significant uptick in prior authorization approvals, and since the NCD, we have doubled average weekly procedure volumes.

All of this makes our install base stickier over time.

With robotics penetration still in the high single digits, we see significant runway ahead.

Speaker #10: And now, Simplicity is annualizing at $100 million. At CRT this year, we presented late-breaking long-term data reinforcing the clinical outcomes of our renal denervation.

Specialty therapies delivered 3% growth. Neurovascular was up 6%, driven by 11% growth in hemorrhagic, including healthy adoption in Neuro Garden and RTS.

We are actively investing in any neovascular as evidenced also by our planned scientia acquisition.

Speaker #10: In over 2,000 patients, Simplicity delivered sustained mean systolic blood pressure reductions of 13.3 and 18.1 milligrams of mercury and ambulatory and in-office settings at three years respectively.

Thierry Piéton: Scientia Vascular represents a significant advancement in navigation, enabling neurointerventionalists to reach areas of the brain that were historically extremely difficult to get to. ENT delivered another quarter of mid-single-digit growth, including high single digit in international markets. In pelvic health, results were flat as solid growth in Altaviva was offset by broader market softness in sacral nerve modulation. Given the progress our teams have made, we look forward to seeing Altaviva continue to scale into 2027. Finally, neuromodulation was up low single digit. This is another area of strategic focus and investment, as demonstrated by our expansion in DBS and planned acquisition of SPR Therapeutics, an attractive space growing over 20% annually. Now turning to Medical Surgical, which delivered 5% growth globally, including 8% in the US. Surgical revenue increased 3% globally, split evenly between the US and international markets.

Scientia represents a significant advancement in navigation, enabling Euro interventionalists to reach areas of the brain that were historically extremely difficult to get to.

Speaker #10: With 90% of patients achieving a meaningful benefit. And as a reminder, a 10-point reduction in BP is proven to show a greater-than-20% reduction in major cardiovascular events like heart attacks, stroke, and heart failure.

ENT delivered, another quarter of mid single digit growth including High single digit in international markets.

In Pelvic Health, results were flat as solid growth in InterStim was offset by broader market softness in sacral nerve modulation.

Speaker #10: So this is critical in underscoring the impact of Simplicity on patients and the health care system itself. Importantly, we stand apart as the proven platform in a category with enormous unmet need.

Given the progress our teams have made, we look forward to seeing how Viva can scale into 2027.

Speaker #10: And we intend to lead it. We are confident in the foundation we've established with robust and growing clinical evidence, a broad label, expanding reimbursement, and growing demand from both physicians and patients.

Finally, Neuromodulation was up low single digits. This is another area of strategic focus and investment, as demonstrated by our expansion in DTM and planned acquisition of Spinal Therapeutics, an attractive space growing over 20% annually.

Speaker #10: We are well-positioned and in the early stages of this ramp to redefine the standard of care in a historically drug-based setting with a new option for managing hypertension.

Surgical revenue increased 3% globally, split evenly between the US and international markets.

Thierry Piéton: Performance was driven by high single-digit growth in both advanced energy and wound management, as well as an increased contribution from Hugo. This was partially offset, like in prior quarters, by continued pressure in bariatrics. Endoscopy delivered high single-digit growth, driven by strong adoption of EndoFlip in the US and Western Europe, and market share gain in Nexpowder in the US. Acute Care and Monitoring was up 11%, including high teens growth in the US. Results were driven by mid-teens growth in Nellcor pulse oximetry, high single-digit growth in respiratory and airways, as well as mid-single digit in peri-operative. The outsize strength we've seen in ACM was a positive tailwind to the quarter. Looking ahead, we anticipate this growth to normalize as we head into fiscal year 2027. Overall, we are very pleased with the finish Medical Surgical had to close the year.

Speaker #10: Now, we're also starting to see meaningful impact from HUGO. Our surgical robotic system. Our worldwide procedure volume growth is 2 to 3x the market, and utilization is increasing.

Performance was driven by high single-digit growth in both Advanced Energy and Wound Management.

As well as an increased contribution from Hugo.

This was partially offset, like in prior quarters, by continued pressure in VAR and Variq.

Speaker #10: Last quarter, we launched HUGO for urology in the United States, placing systems at leading institutions and treating our first patients. Feedback from surgical teams has been positive, both in terms of their experience and early clinical outcomes.

Endoscopy delivered high single-digit growth, driven by strong adoption of endo. Flip in the US and Western Europe.

And market share gain in Next Powder in the U.S.

And then acute care and monitoring was up 11%, including high-teens growth in the U.S.

Speaker #10: We are pleased to announce that in late April, we submitted to the FDA for 510(k) clearance for general surgery and gynecologic indications. As well as for our LigaSure RAS vessel sealer.

Results were driven by mid-teens growth in Nellcor pulse oximetry, high single-digit growth in Respiratory and Airways, as well as mid-single-digit in Perioperative.

Speaker #10: We also recently received FDA clearance for our pro-grip advanced, a new mesh optimized for robotic-assisted ventral hernia repair procedures. And our touch surgery digital ecosystem will continue to represent a clear advantage, with over 1,400 installations of 30% plus sequentially.

The outside strength we've seen in ACM was a positive tailwind to the quarter. Looking ahead, we anticipate this growth to normalize as we head into fiscal year '27.

Overall, we are very pleased with the finish. Medical Surgical had to close the year.

Thierry Piéton: Rounding out with the diabetes business, we completed the MiniMed IPO during the quarter, marking an important milestone in establishing MiniMed as a standalone, publicly traded company. For the quarter, the diabetes business delivered 15% reported growth, or 8.1% organic, driven by strong international execution and continued momentum in US CGM and new patient starts as the team prepares for the commercial launch of MiniMed Flex during the summer. Look, we are excited to see the MiniMed team share more detail on their first earnings call later this morning. Before we move into the details of Q4 and guidance, I would like to remind everyone that the diabetes financials, as reported by Medtronic, are prepared on a different basis than the standalone MiniMed ones. Accordingly, you cannot precisely estimate Medtronic remainco financials by subtracting one set of financials from another.

Speaker #10: We are complementing our strong foundation with data and analytics driving a more precise intelligent and a predictable future in surgery. Digital is creating real value in the OR, and we are investing in innovating to lead in this space.

Rounding out Diabetes, we completed the Minimed IPO during the quarter, marking an important milestone in establishing Minimed as a standalone, publicly traded company.

Speaker #10: We are building our robotics program deliberately. We are driving utilization and procedure growth globally, making steady progress in the United States, and investing to strengthen our broader surgical franchise over time.

For the quarter, the Diabetes business delivered 15% reported growth, or 8.1% organic, driven by strong international execution and continued momentum in US CGM and new patient starts.

as the team prepares for the commercial launch of Mediflax during the summer.

So we're excited to see the MiniMed team share more detail on their first earnings call later this morning.

Speaker #10: HUGO is having an impact on our med-surge portfolio and we are pleased with the early progress. Now, moving to Altiviva. Momentum here continues to build.

Before we move into the details of Q4 and guidance, I'd like to remind everyone that the diabetes financials, as reported by Medtronic, are prepared on a different basis than the standalone MiniMed ones.

Speaker #10: And we are encouraged by the strong physician feedback and early patient demand. Altiviva redefines what is possible for patients with urge urinary incontinence. With same-day activation, up to 15 years' longevity, and full-body MRI access while the device remains on, patients can start therapy sooner and live life with fewer disruptions.

Thierry Piéton: As with prior similar transactions post-split, when Medtronic is no longer the majority shareholder of MiniMed, we will provide Medtronic guidance that will reflect updated operational performance metrics and share count. Now turning to financials. Revenue this quarter of $9.8 billion grew 9.9% reported or 6.6% organic. This represented a 60 basis points acceleration from last quarter on a far more challenging comp. This caps the strongest annual performance we have seen in 10 years. Geographically, performance was balanced, with 7% growth in the US and 6.2% internationally. Before I turn to the P&L, I want to pause and take a moment to acknowledge our Medtronic colleagues, especially those in the Middle East and impacted countries who, despite the ongoing conflict, have remained focused on serving our customers and our patients. Their performance under tremendously difficult circumstances reflects their commitment, resilience, and the strength of our mission and culture.

Accordingly, you cannot precisely estimate Medtronic's remaining financials by simply subtracting one set of financials from the other. As with prior similar transactions post-split, when Medtronic is no longer the majority shareholder of MiniMed, we will provide Medtronic guidance that will reflect updated operational performance metrics and share counts.

Speaker #10: We've trained nearly 1,000 physicians since launch. And that investment is starting to translate into commercial momentum. Sequentially, active and planners are up three times.

Now turning to financials, revenue this quarter of $9.8 billion grew 9.9% reported, or 6.6% organic. This represented a 60 basis point acceleration from last quarter on a far more challenging comp.

Speaker #10: And patients treated are up 2 and 1/2 times. Importantly, as physicians gain more experience and move through prior authorization more swiftly, implants are accelerating.

This caps the strongest annual performance we have seen in 10 years. Geographically, performance was balanced, with 7% growth in the U.S. and 6.2% internationally.

Speaker #10: Finally, we executed our focused portfolio strategy. In early March, we completed the Minimed IPO, establishing it as a standalone publicly traded company. We also advanced our M&A and venture initiatives.

Before I turn to the P&L, I want to pause and take a moment to acknowledge our Medtronic colleagues.

Speaker #10: Targeting higher growth segments to accelerate innovation in markets where we have a right to win. In our coronary portfolio, we closed on the CathWorks transaction.

Especially those in the Middle East and infected countries, who, despite the ongoing conflict, have remained focused on serving our customers and our patients.

Their performance under tremendously difficult circumstances reflects their commitment.

Resilience.

And the strength of our mission and culture.

Speaker #10: CathWorks' FFR angio system uses a combination of AI and advanced computational science to improve decision-making in the cath lab. The company recently presented positive one-year data from the AllRise trial validating FFR angio as a noninvasive technology poised to disrupt the gold standard traditional wire-based FFR.

So, thank you.

Thierry Piéton: Thank you. On that note, I will now turn to walking us through the Q4 P&L. Our adjusted gross margin was 65.4%, up 30 basis points year-over-year and up 50 basis points sequentially. Let me walk you through the elements shaping gross margin this quarter as I usually do. Similar to Q3, our disciplined pricing provided 30 basis points benefit. Net of inflation, cost down contributed 60 basis points, driven by comps efficiency programs as our portfolios, global operations, and supply chain teams delivered material savings, improved efficiencies, and higher yields. Mix was unfavorable by 60 basis points, largely reflecting the diabetes business, as well as higher mix of lower margin capital to higher margin catheters in our cath business.

On that note, I will now turn to walking us through the fourth quarter. P&L, our adjusted gross margin was 65.4%, up 30 basis points year-over-year and up 50 basis points sequentially.

Let me walk you through the elements shaping gross margin this quarter, as I usually do.

Speaker #10: Which is a $1 billion segment growing in the low double digits. We announced plans to acquire Scientia and SPR Therapeutics. As well as investments in beluga medical and cardio acc.

Similar to Q3, our disciplined pricing provided a 30 basis point benefit.

Speaker #10: Scientia will meaningfully expand our neurovascular platform with differentiated guidewire technologies for stroke enabling every neurovascular procedure to start with Medtronic. SPR Therapeutics for PNS will build out our portfolio of chronic pain management therapies.

Net of inflation cost down contributed 60 basis points. Driven by cogs efficiency programs, as our portfolios Global operations and supply chain. Teams delivered material savings. Improved efficiencies and higher yields.

Speaker #10: And beluga medical and cardio acc will advance development of next-generation ICE catheters that will further advance our EP toolkit. In our venture portfolio, we invested in emerging technologies, including Pulnovo, a first of its kind minimally invasive system designed to address pulmonary artery denervation.

Mix was unfavorable by 60 basis points, largely reflecting the diabetes business as well as higher mix of lower margin Capital to higher margin. Catheters in our cast business

Thierry Piéton: While a near-term headwind to gross margin rate, this represents a favorable leading indicator as it reflects further penetration of the market and strong pull-through potential for future catheter sales. Tariffs impacted the business by $74 million, or 80 basis points, in line with expectations. Finally, foreign exchange was an approximate 80 basis points tailwind. Moving to overhead, adjusted R&D was roughly 7% of revenue in Q4, and fiscal year R&D grew $150 million as we march towards higher investment goals. Q4 to date, we closed or announced nearly $2 billion of additional investments as we executed on M&A and venture capital strategy. We expect recent M&A to contribute approximately $150 million to inorganic revenue growth in fiscal year 2027, and to be a healthy contributor to our organic base in the out years.

While a near-term headwind to gross margin rate, this represents a favorable leading indicator.

As it reflects further penetration of the market and strong pull-through potential for future catheter sales.

Speaker #10: And we entered into a distribution agreement with Merit Medical for via verte, which brings an FDA-cleared solution for chronic vertebrogenic back pain. Now, both of these transactions will expand our reach into new and high-growth adjacencies.

Tariffs impacted the business by $74 million, or 80 basis points, in line with expectations. And finally, foreign exchange was an approximate 80 basis point tailwind.

Moving to overhead adjusted R&D was roughly 7% of Revenue in the fourth quarter and fiscal year R&D grew 150 million as we marched towards higher investment goals.

Speaker #10: Where we hold leadership positions. These investments are deliberate. And tightly aligned to our strategy of. Reinforcing leadership positions, building scalable ecosystems, and extending our reach and attractive markets.

We closed or announced nearly $2 billion of additional investments as we executed our M&A and venture capital strategy.

Speaker #10: Together, these meaningful tuck-in investments position us to drive sustainable growth for the near and the long are just a few highlights from the quarter.

We expect recent M&A to contribute approximately $150 million to inorganic revenue growth in fiscal year 2027.

And to be a healthy contributor to our organic base in the out years.

Thierry Piéton: Within our venture portfolio, we also made 16 venture investments this fiscal year, totaling approximately $250 million. Each of these investments are in growth-accreting adjacencies and should generate strong returns and potential acquisition opportunities in the years ahead. We're committed to accelerating our pace of innovation and top-line growth through a prudent and strategic combination of organic and inorganic investment. Adjusted SG&A was 30.5% of revenue in the quarter, up 30 basis points year over year. With favorability below the line this quarter, we made the deliberate decision to accelerate investment in our commercial firepower to support our key growth areas. Our adjusted operating profit was $2.5 billion, resulting in an adjusted operating margin of 25.5%. This included impacts of 160 basis points from the MiniMed Blackstone payment and 80 basis points from tariffs. Our adjusted tax rate was 17.7%, slightly better than expected.

Speaker #10: Looking across the business, multiple operating units contributed to the strength in Q4. Like CST with Stealth Access or CRM with Omnia Secure and Micra.

Within our Venture portfolio, we also made 16 Venture investment. This is this fiscal year totaling, approximately 250 million.

Speaker #10: And many others, which Terry will cover in more depth. So to close, I want to start with thanking our teams. Not only for delivering a strong year, but embracing the changes that have enabled this performance.

Each of these investments are in growth, accretion of adjacencies, and should generate strong returns and potential acquisition opportunities in the years ahead.

We're committed to accelerating our pace of innovation and topline growth through a prudent and strategic combination of organic and inorganic investment.

Speaker #10: In a world with many moving pieces, we are executing. We are delivering. We are delivering on our strategic priorities and accelerating access to life-changing therapies.

Adjusted SG&A was 30.5% of revenue in the quarter, up 30 basis points year-over-year.

Speaker #10: All while creating meaningful value for patients, for physicians, for healthcare systems, and for our shareholders. Now, with that, I'm going to turn it over to Terry.

With favorability below the line, this quarter we made the deliberate decision to accelerate investment in our commercial Firepower to support our key growth areas.

Speaker #10: He's going to walk through the financial results of both the quarter and the full year before turning to guidance. Terry?

our adjusted operating profit was 2.5 billion resulting in an adjusted operating margin of 25.5%

Speaker #2: Hey, thanks, Jeff. And hello, everyone. I appreciate you joining today. Let's start with cardiovascular, which delivered 10% revenue growth this quarter, led by 14% in the US and 7% in international markets.

This included impacts of 160 basis points from the MiniMed Blackstone payment, and 80 basis points from tariffs.

Our adjusted tax rate was 17.7%, slightly better than expected.

Thierry Piéton: All in all, adjusted EPS was $1.55, above the midpoint of our guidance range and above the street expectations. Free cash flow was $5.4 billion in fiscal year 2026, the strongest it has been since 2022 and ahead of our expectations. We've made solid progress in working capital over the year. The team delivered notable progress in accounts receivable and controlled inventory effectively. Our CapEx spend was up roughly $50 million and grew at a significantly lower rate than revenue. Because of this, we ended the year with a $9.2 billion in cash and investments, positioning the company very favorably to execute on M&A opportunities. Look, our performance this year underscores the strength of our portfolio and the consistency of our execution.

Speaker #2: Driving this performance was 78% growth in cash, including 124% in the US, in a $14 billion market that grew about 20% in 4Q, where now annualizing over $2 billion in revenue, and are on track to reach $2 billion trailing in the first quarter of fiscal year 27.

All in all, adjusted EPS was $1.055, one cent above the midpoint of our guidance range and about in line with Street expectations.

Free cash flow was 5.4 billion. In fiscal year 26, the strongest it has been since 2022 and the head of our expectations.

Speaker #2: Cardiac rhythm management delivered 5% growth in both US and international markets. Defibrillation delivered mid-single-digit growth, including high teens in ICD and mid-60s in EV/ICD.

We've made solid progress in working capital over the year. The team delivered notable progress in accounts receivable and controlled the inventory effectively.

Our capex bands was up, roughly 50 million, and grew at a significantly, lower rate than Revenue.

Speaker #2: We saw strong momentum in the recently launched Omnia Secure defibrillation lead, following our indication expansion that allows for conduction system pacing. Cardiac pacing therapies delivered mid-single-digit growth, driven by mid-teens in Micra and high teens in the Select Secure 3830 lead for CSP.

Because of this, we ended the year with $9.2 billion in cash and investments, positioning the company very favorably to execute on M&A opportunities.

Thierry Piéton: While we faced headwinds like tariffs and a transitional product mix, we made meaningful progress in our efficiency initiatives, driving COGS improvements, and achieving gross profit leverage ex tariffs. Importantly, we remain disciplined in balancing performance with investment. We purposefully increased investment in SG&A, R&D, and M&A to support innovation and commercialization in some of the most attractive and durable growth markets in MedTech. I'd like to thank our teams for all the progress made this year, and I look forward to seeing this momentum carrying into the next fiscal year. Speaking of 2027, turning to the guidance. I want to note that our full-year guidance continues to include the diabetes business, as Medtronic remains the majority shareholder of MiniMed through the spin-off process. Today, we're guiding fiscal year 2027 organic revenue growth of 6.75% to 7.25%, including approximately 11.5% to 12% organic growth in the Q1.

Okay, performance. This year, underscores the strength of our portfolio and the consistency of our execution, while we faced headwinds like tariffs and a transitional product mix, we made meaningful progress in our efficiency initiatives driving cogs improvements and achieving gross profit. Leverage X tariffs,

Speaker #2: Turning to structural heart, performance in the quarter was flat. We saw strong international performance, while the US was softer in part due to the lower risk isk data.

Importantly, we remain disciplined in balancing performance with investment.

Speaker #2: We're encouraged, though, by the trajectory we've seen in the field as weekly US procedure volumes have stabilized over the last eight weeks. Structural heart clearly remains a strategic priority for us, with internal programs in mitral and tricuspid replacement and targeting it external investment in TAVR, including Anteris paving the way forward.

We purposefully increase investment in SG&A, R&D, and M&A to support innovation and commercialization in some of the most attractive and durable growth markets in MedTech.

I'd like to thank our teams for all the progress made this year, and I look forward to seeing this momentum carry into the next fiscal year.

Speaking of '27 now, turning to the guidance,

Speaker #2: Coronary declined in the quarter, but was offset by strength in renal denervation as described by Jeff. Importantly, we saw clear acceleration of simplicity in the back half of the year.

I want to know. There are 4 year. Guidance continues to include the diabetes business as Medtronic Remains the majority shareholder of Mini Med through the spit off process.

Speaker #2: We're pleased to see the sequential lift and feel well positioned to drive momentum going forward. Finally, peripheral vascular health delivered low single-digit growth, and cardiac surgery was up mid-single digit.

Today we're guiding fiscal year, 27 organic Revenue growth of 6.75% to 7.25% including approximately 11 and a half percent to 12%, organic growth in the first quarter.

Thierry Piéton: This guidance includes a roughly 25 basis points tailwind from the diabetes business. It also incorporates the benefit from the additional selling week, which is recognized in Q1. We expect it to contribute approximately 125 basis points to the full-year growth and 500 to 600 basis points in Q1. Additionally, based on recent FX rates, we expect the foreign exchange to be a neutral to roughly $100 million headwinds for the full year, with an approximate neutral to $50 million tailwind to Q1. Moving down to P&L, we expect our fiscal 2027 margin to be roughly in line with the previous year, excluding tariffs. Pricing and cost efficiency programs are expected to offset the impact of business mix, primarily from diabetes. This pressure point will disappear upon separation.

This guidance includes a roughly 25-basis-point tailwind from the Diabetes business.

Speaker #2: Moving to neuroscience, our position in neuroscience is strong. We have the most comprehensive portfolio and are the number one player and category leader across each of our segments.

It also incorporates the benefit from the additional selling week, which is recognized in the first fiscal quarter.

We expected to contribute approximately 125 basis points to the 4-year growth.

And 500 to 600 basis points in the first quarter.

Speaker #2: We're investing across the portfolio to advance pipeline innovation, and accelerate long-term growth. This quarter, we delivered 3% revenue growth globally, driven by 6% in international markets.

Additionally, based on recent FX rates, we expect foreign exchange to be a new to roughly $100 million headwind.

For the full year, with an approximate neutral to $50 million tailwind to the first quarter.

Speaker #2: Cranial and spinal technologies was up 3% in both US and international markets. Core spine gained share this quarter, growing 6% on continued module X expansion and distributor conversions.

Moving down the p&l. We expect our fiscal 27 margin to be roughly in line with the previous year. Excluding tariffs

Speaker #2: In neurosurgery, results improved sequentially, supported by low double-digit growth in navigation following the launch of Stealth Access late in the quarter. Stealth Access platform is an important growth driver for our CST business.

Pricing and cogs efficiency. Programs are expected to offset the impact of business mix. Primarily from diabetes. This pressure point will disappear upon separation.

Thierry Piéton: We anticipate a tariff impact to COGS of approximately USD 250 million in total, including USD 75 million in Q1. Including tariffs, we expect fiscal year 2027 gross margin to decrease by roughly 20 basis points. We continue to invest in innovation to accelerate the launch of key products. This includes incremental spend as we integrate several acquisitions. Overall, we expect our fiscal 2027 operating margin to be up 60 basis points, driven by the absence of Blackstone milestone payments we saw this year and operating leverage. Below the operating profit line, we're expecting an approximate 200 basis points headwind, driven by an increase in net interest expense as well as a slightly higher tax rate. We're guiding 2027 EPS of $5.90 to 6.00. Fiscal year 2027 incorporates several dynamic components, and I would like to be explicit around our assumptions on the inputs.

We anticipate a tariff impact to COGS of approximately $250 million in total, including...

Speaker #2: The early commercial launch is progressing well, physician feedback has been very positive, and sales are off to a very strong start. This quarter, we achieved FDA clearance across spine, cranial, and ENT indications as well as CE mark for spine and cranial, broadening the platform's reach across our portfolio.

By roughly 20 basis points.

We continue to invest in in Innovation to accelerate the launch of Key Products.

Speaker #2: Look, Stealth is a force multiplier, driving pull-through across planning, robotics, and our broader ABLE ecosystem. It promotes the adoption of robotics in spine surgery, creates efficiencies that allow more physicians to integrate it without disrupting workflow.

This includes incremental spend as we integrate several Acquisitions overall. We expect our fiscal 27, operating margin to be up 60 basis points driven by the absence of Blackstone Milestone payments. We saw this year

And operating Leverage.

Below the operating profit line. We're expecting an approximate 200 basis points headwind driven by an increase in net interest expense as well as a slightly higher tax rate.

Speaker #2: All of this makes our install base stickier over time. With robotics penetration still in the high single digits, we see significant runway ahead. Specialty therapies delivered 3% growth.

We're guiding 27. Epps of 5.90 to 6 dollars.

Fiscal year '27 incorporates several dynamic components, and I would like to be explicit around our assumptions on the inputs.

Speaker #2: Neurovascular was up 6%, driven by 11% growth in hemorrhagic including healthy adoption in neuroguard and RTs. We are actively investing in neurovascular as evidenced also by our planned Scientia acquisition.

Thierry Piéton: We have included an approximate 150 basis points benefit from the extra selling week to the full year. Because we do not yet know the timing of the MiniMed separation, we're taking a conservative approach and including the full year of the diabetes business in our estimates, including the associated monthly dilution and assuming no separation share count benefit in fiscal 2027. Should we separate prior to year-end, as per our intent, we could see potential upside from our current guidance. We're factoring 2% dilution from M&A, which is roughly 1 point higher than what we shared last quarter, as the timing of several of our deals actually occurred earlier than anticipated. We're taking the full tariff impact of $250 million, as mentioned previously, an increase of $65 million versus prior year. We have not taken into consideration any government refunds.

We have included an approximate 150 basis points benefit from the extra selling week to the 4 year.

Speaker #2: Scientia represents a significant advancement in navigation, enabling neurointerventionalists to reach areas of the brain that were historically extremely difficult to get to. ENT delivered another quarter of mid-single digit growth, including high single digit in international markets.

Because we do not yet know the timing of the Med Device separation, we're taking a conservative approach and including the full year of the Diabetes business in our estimates, including the associated monthly dilution, and assuming no separation-shown benefit in fiscal '27.

Should we separate prior to your end, as per our intent, we could see potential outside from our current guidance.

Speaker #2: In pelvic health, results were flat as solid growth in AltaViva was offset by broader market softness in sacral nerve modulation. Given the progress, our teams have made we look forward to seeing AltaViva continue to scale into 2027.

We are factoring 2% dilution from M&A, which is roughly 1 point higher than what we shared last quarter, as the timing of several of our deals actually occurred earlier than anticipated.

Speaker #2: Finally, neuromodulation was up low single digit, this is another area of strategic focus and investment as demonstrated by our expansion in BVNA and planned acquisition of SPR Therapeutics and attractive space growing over 20% annually.

We're taking the full tariff impact of 250 million, as mentioned previously, an increase of 6 65 million versus prior year.

We have not taken into consideration any government refunds.

Thierry Piéton: We've embedded also a roughly 1 point headwind from increased fuel and transportation costs due to the conflict in the Middle East. Finally, based on recent FX rate, we expect foreign exchange to have a neutral to 1% accretive impact for the full year. For Q1, we would expect EPS in the range of $1.38 to $1.40, including a 600 to 700 basis points benefit from the extra selling week, as well as roughly neutral impact from foreign exchange at recent rates. Look, all of this taken together, our approach to guidance for the full fiscal year positions us well for a strong performance in 2027. With that, back to you, Geoff.

We've embedded. Also a roughly 1 point headwind from increased Fuel and transportation cost.

Speaker #2: Now, turning to medical surgical, which delivered 5% growth globally, including 8% in the US. Surgical revenue increased 3% globally, split evenly between the US and international markets.

Due to the conflict in the Middle East. And finally, based on recent FX rate, we expect foreign exchange to have a neutral to 1% accretive impact for the 4 year.

Speaker #2: Performance was driven by high single digit growth in both advanced energy and wound management, as well as an increased contribution from Hugo. This was partially offset, like in prior quarters, by continued pressure in bariatrics.

For the first quarter, we would expect EPS in the range of $1.38 to $1.40, including a 60 to 70 basis points benefit from the extra selling week, as well as a roughly neutral impact from foreign exchange at recent rates.

Speaker #2: Endoscopy delivered high single digit growth, driven by strong adoption of endoflip in the US and Western Europe, and market share gain in Nexpowder in the US.

The call of this, taken together, is our approach to guidance for the 4504, your positions, as well as for a strong performance in 2027.

And with that, back to you, Jeff.

Okay. Thanks Terry.

Geoff Martha: Okay, thanks, Thierry. As we come to a close, I'd like to take a step back. The macro backdrop, as you know, has been challenging and dynamic. MedTech is structurally resilient because the fundamentals are durable. People are living longer, chronic disease is rising, and the demand for medical procedures will only grow. AI, digital, robotics, as well as advanced electronics, are meaningful accelerants. At Medtronic, we are uniquely positioned to integrate these technologies for safer care, improved outcomes, and stronger healthcare economics that scale globally. I also want to take a moment to recognize Brett Wall, who will be leaving Medtronic this summer following an extraordinary 25-year career. Brett has been an integral part of our leadership team and played a defining role in shaping our Neuroscience Portfolio, including helping establish interventional stroke as a global standard of care and advancing innovation across neuromodulation.

Now, as we come to a close, I'd like to take a step back.

Speaker #2: And then acute care and monitoring was up 11%, including high teens growth in the US. Results were driven by mid-teens growth in Nelcore Pulse oximetry, high single digit growth in respiratory and airways, as well as mid-single digit in perioperative.

The macro backdrop, as you know, has been challenging and dynamic.

But Medtech is, structurally, resilient.

Because the fundamentals are durable. People are living longer, chronic diseases are rising, and the demand for medical procedures will only grow.

Speaker #2: The outsized strength we've seen in ACM was a positive tailwind to the quarter, looking ahead we anticipate this growth to normalize as we head into fiscal year '27.

AI, digital robotics, as well as advanced electronics, are meaningful accelerators.

Speaker #2: Overall, we are very pleased with the finish medical surgical had to close the year. Rounding out with the diabetes business, we completed the Minimed IPO during the quarter, marking an important milestone in establishing Minimed as a standalone publicly traded company.

And at Medtronic, we are uniquely positioned to integrate these technologies.

For safer care, improved outcomes, and stronger healthcare economics that scale globally.

I also want to take a moment to recognize Brett wall.

Speaker #2: For the quarter, the diabetes business delivered 15% reported growth, or 8.1% organic, driven by a strong international execution and continued momentum in US CGM and new patient starts, as the team prepares for the commercial launch of Minimed Flex during the summer.

Who will be leading Medtronic this summer? Following an extraordinary 25-year career.

Brad has been an integral part of our leadership team and played a defining role in shaping our Neuroscience portfolio, including helping establish Interventional, Stroke global standard of care.

And advancing Innovation across neuromodulation.

Speaker #2: Look, we're excited to see the Minimed team share more detail on their first earnings call later this morning. Before we move into the details of Q4 and guidance, I'd like to remind everyone that the diabetes financials, as reported by Medtronic, are prepared on a different basis than the standalone Minimed ones.

Geoff Martha: His impact on patients, on our strategy, and our culture, it's been significant, and we are deeply grateful for his contributions. As part of this planned transition, Dr. Kweli Thompson will step into the role of Executive Vice President and President of our Neuroscience Portfolio. Kweli is a proven leader with a strong track record of execution, deep clinical and operational experience, most recently leading our CRM business. He is well positioned to lead Neuroscience into its next phase of growth. Again, we want to thank Brett for his leadership and we look forward to Kweli's continued impact. We delivered a strong finish to the year, powered by the breadth of our portfolio and disciplined execution across the business. Look, we are not letting up. We are investing in the future.

His impact on on patients, on our strategy.

And our culture, it's it's been significant.

And we are deeply grateful for his contributions.

Speaker #2: Accordingly, you cannot precisely estimate Medtronic remaining financials by subtracting one set of financials from the other. As with prior similar transactions post-split, when Medtronic is no longer the majority shareholder of Minimed, we will provide Medtronic guidance that will reflect updated operational performance metrics and share count.

As part of this plan transition. Dr. Quay Thompson will step into the role of Executive Vice President and president of our Neuroscience portfolio.

quality is a

with a strong.

Track record of execution.

Deep clinical and operational experience, most recently leading our CRM business.

Speaker #2: Now, turning to financials, revenue this quarter of 9.8 billion grew 9.9%, reported, or 6.6% organic. This represented a 60 basis point acceleration from last quarter, on a far more challenging comp.

He is well positioned to lead Neuroscience into its next phase of growth.

Again, we want to thank Brett for his leadership.

And we look forward to Qurey's continued impact.

Speaker #2: This caps the strongest annual performance we have seen in 10 years. Geographically, performance was balanced, with 7% growth in the US, and 6.2% internationally.

Remembered a, a strong finish to the year.

And look, we are not letting up.

Speaker #2: Before I turn to the P&L, I want to pause and take a moment to acknowledge our Medtronic colleagues. Especially those in the Middle East and impacted countries who despite the ongoing conflict have remained focused on serving our customers and our patients.

Geoff Martha: We are building momentum in our key growth areas, advancing innovations across the portfolio, and deploying capital through targeted M&A, ventures, and partnerships. Together with strong commercial execution and market development, these actions give us confidence in our ability to deliver durable, innovation-led growth for FY 2027 and years to come. With that, let's turn to Q&A. Ingrid, can you please provide the instructions and queue up the analysts?

We are investing in the future. We are building momentum in our key growth areas, advancing innovations across the portfolio, and deploying capital through targeted M&A.

Ventures and Partnerships.

Speaker #2: Their performance under tremendously difficult circumstances reflects their commitment, resilience, and the strength of our mission and culture. So thank you. On that note, I will now turn to walking us through the fourth quarter P&L.

Together with strong commercial execution and market development, these actions give us confidence in our ability to deliver durable results.

Innovation-led growth for FY 2 7.

With that, let's turn to Q&A. Ingred, can you please provide the instructions and queue up the analysts?

Ingrid Goldberg: For the sell-side analysts that would like to ask a question, please select the Participants button and click Raise Hand. If you're using the mobile app, press More and select Raise Hand. Your lines are currently on mute, and when called upon, you'll receive a request to unmute your line, which you must respond to before asking your question. Finally, please be advised that this Q&A session will be recorded. We'll pause for a few seconds to assemble the queue. We'll take our first question from Vijay Kumar at Evercore. Vijay, please go ahead.

Speaker #2: Our adjusted gross margin was 65.4%, up 30 basis points year over year, and up 50 basis points sequentially. Let me walk you through the elements shaping gross margin this quarter as I usually do.

Speaker #2: Similar to Q3, our disciplined pricing provided 30 basis points benefit. Net of inflation, cost down contributed 60 basis points, driven by COGS efficiency programs, as our portfolios' global operations and supply chain teams delivered material savings improved efficiencies and higher yields.

To the analysts in the South who would like to ask a question, please select the participants button and click 'Raise Hand.' If you're using the mobile app, that's more like 'Raise Hand.' Your line is currently on mute. When called upon, you'll receive a request to unmute your line, which you must respond to before asking your question. Finally, please be advised that this Q&A session will be recorded. We'll pause for a few seconds to assemble the queue.

We'll take our first question from Vijay Kumar at evercore. BJ, please go ahead.

Vijay Kumar: Hey, guys. Thank you for taking my question. Geoff, congrats on a nice sprint year. Maybe Geoff, I'll start with the guidance question. Fiscal 2027, excluding the extra week, I think underlying 5.5% to 6%. That's an acceleration in line with our prior assumptions. As CAS slows down, that's been a concern for the market, right? Can you just talk about what are the offsets, which segments accelerate to offset CAS and drives the confidence in this 5.5% to 6% organic?

Speaker #2: Mix was unfavorable by 60 basis points, largely reflecting the diabetes business, as well as higher mix of lower margin capital to higher margin catheters in our CAS business.

Speaker #2: While a near-term headwind to gross margin rate this represents a favorable leading indicator, as it reflects further penetration of the market and strong pull-through potential for future catheter sales.

Hey guys, thank you for taking my question and Jeff, uh, congrats on a nice Sprint here, maybe Jeff. Uh, I'll start with the guidance. Question, fiscal, 27, including the extra week, I think underlying 5 and a half to 6. Uh, that's an acceleration in line with that prior assumptions. I think you know, as cash flows down you know that's been a concern for the market, right? Can you just talk about what are the offsets, what segments accelerated to offset, uh, cash and, you know, drives the confidence in this 5 and a half to 6 organic

Speaker #2: Tariffs impacted the business by 74 million dollars, or 80 basis points, in line with expectations. Finally, foreign exchange was an approximate 80 basis points tailwind.

Geoff Martha: Well, thanks for the question, Vijay. Let me just start with the CAS comment you made, and then I'm going to turn it over to Thierry to answer the ins and outs and puts and takes of the guidance question. On CAS, look, the impact of CAS to our growth will be very similar next year to this year. We see the market in FY27. Well, first of all, in Q4, we think the CAS market grew around 20%. In FY27, we're thinking mid to high teens market growth, and we're going to grow north of two times that of the market rate. Again, the business has gotten a lot bigger, so its contributions to our growth are even more because of the size. We're annualizing. That business is annualizing now at two billion.

Speaker #2: Moving to overhead, adjusted R&D was roughly 7% of revenue in the fourth quarter, and fiscal year R&D grew 150 million, as we marched ed towards higher investment goals.

Well, thanks for the the question Vijay. Maybe I'll let me just start with the cast, comment you made, and then I'm going to turn it over to Terry to answer the ins and outs and puts and takes of the, of the, of the guidance question. But on cast, look I the impact of of cast

Speaker #2: Q4 to date, we closed or announced nearly $2 billion of additional investments as we executed on M&A and venture capital strategy. We expect recent M&A to contribute approximately $150 million, to inorganic revenue growth in fiscal year '27, and to be a healthy contributor to our organic-based in the out years.

Uh, to our growth will be very similar next year to this year. I mean, we, we see the market and FY, 27.

Speaker #2: Within our venture portfolio, we also made 16 venture investments this fiscal year, totaling approximately $250 million. Each of these investments are in growth-accretive adjacencies, and should generate strong returns and potential acquisition opportunities in the years ahead.

Geoff Martha: We're going to hit that $2 billion backward-looking revenue mark that I laid out there. We're going to hit that in Q1. We're about 15% share right now and marching towards market leadership in CAS. Look, we're not talking about CAS slowing down, or its impact on our growth. I just laid out where I think it'll grow, but the impact is strong. I just want to clarify that first, and then maybe, Thierry, you talk about the-

Uh, growing. Well, first of all, in Q4, we think that cath market grew around 20%. In FY27, 28 out there, we're going to hit that.

Speaker #2: We're committed to accelerating our pace of innovation and top-line growth through a prudent, strategic combination of organic and inorganic investment. Adjusted SG&A was 30.5% of revenue in the quarter, up 30 basis points year over year.

Thierry Piéton: Sure

Geoff Martha: Talk about the guidance.

Thierry Piéton: Sure. Hi, Vijay. Look, just maybe to give you the couple of the growth rate here. The cardiovascular business should have a performance next year that's pretty much in line with what we've seen in 2026. It's got really strong momentum. Geoff just talked about CAS. We're clearly still in the early innings of the CAS development here. You probably saw in the commentary that from an install base perspective, the install base was up 40% in the Q4 alone. That gives us a ton of headroom to grow the catheter sales going forward. CRM will continue to be strong, mid-single digit. We have a lot of strength coming from innovation, from Micra, from Omnia, from EV-ICD, and that's going to carry into 2027. Staying in the cardiovascular portfolio, we expect to continue to see some strong lift coming from Ardian.

Speaker #2: With favorability below the line, this quarter we made a deliberate decision to accelerate investment in our commercial firepower, to support our key growth areas.

Speaker #2: Our adjusted operating profit was 2.5 billion, resulting in an adjusted operating margin of 25.5%. This included impacts of $160 basis points from the Minimed Blackstone payment, and 80 basis points from tariffs.

Speaker #2: Our adjusted tax rate was 17.7%, slightly better than expected, all in all, adjusted EPS was $1.55, above the midpoint of our guidance range, and above the street expectations.

In in, in q1, you know that, that imply, you know, we're we're about 15% share right now in marching towards Market leadership, and cast. So I don't, you know, we're not, you know, look, we're not talking about slowing down, uh, or its impact on our growth. Uh, I just laid out what I think it'll grow, but the impact is strong. So I just want to clarify that first and then maybe Terry you talk about, the sure you talk about the, uh, guidance, hi Vijay. Um, so so look, I just maybe to give you the the couple comes to growth right here. So the, the cardiovascular business should have a performance next year. That's pretty much in line with what we've seen in 2016. So it's, it's in a it's, it's got really, really strong momentum Jeff. Jeff just talked about cast, where clearly still in the early Innings of of the cast or the cast development here. Um, You probably saw in in the commentary that, you know, from an install, the install base was up 40% in the fourth quarter alone. So that gives us a tough Headroom, you know, to to to go the catheter sales going forward CRM uh will continue to be strong, mid mid, single digit. You know. Um we have a lot of strength.

Speaker #2: Free cash flow was 5.4 billion in fiscal year '26, the strongest it has been since 2022, and ahead of our expectations. We've made solid progress in working capital over the year, the team delivered notable progress in accounts receivable, and controlled inventory effectively, our CapEx spend was up roughly 50 million and grew at a significantly lower rate than revenue.

Thierry Piéton: Ardian is now annualizing about $100 million revenue a year, and we expect that to continue to grow significantly into 2027 and beyond. We've incorporated a prudent guidance for structural heart. As we mentioned in the commentary, the business has been pretty stable over the last weeks, and that's what we've incorporated in the guidance going forward. Strong continuation in cardiovascular. We've got the Neuroscience Portfolio. Hey, look, in neuroscience, we're leading in every segment we're in, and we're gaining share. On top of that, we've got meaningful innovation in almost every segment out there. If you take CST, we have Stealth Access. Stealth Access is off to a really good start. About 50% of the revenue we get in CST is coming from consumables.

Coming from Innovation, from Minecraft from Omnia, uh, from evic CD, and that's going to carry into, uh, into 27. And then, um, you know, staying in the cardiovascular portfolio, we expect to continue to see some Strong Lift coming from ardian, you know, so ardian is now analyzing about 100 million Revenue a year and we expect that to continue to grow significantly significantly into 27 and, and Beyond and then we've Incorporated a, you know, prudent guidance or structural heart. Um,

Speaker #2: Because of this, we ended the year with a 9.2 billion in cash and investments, positioning the company very favorably to execute on M&A opportunities.

Speaker #2: Look, our performance this year underscores the strength of our portfolio, and the consistency of our execution. While we faced headwinds like tariffs and a transitional product mix, we made meaningful progress in our efficiency initiatives, driving COGS improvements, and achieving gross profit leverage ex-tariffs.

Speaker #2: Importantly, we remained disciplined in balancing performance with investment. We purposefully increased investment in SG&A, R&D, and M&A to support innovation and commercialization in some of the most attractive and durable growth markets in MedTech.

Thierry Piéton: The more we sell Stealth Access, the more we're going to have pull-through on the consumables side, and we're super excited about that. In the neurovascular business, you saw that we made progress this quarter that's going to continue into 2027. We've got a ton of innovation coming there, with our Neuroguard product and with MMA, and that's going to continue going forward. On top of that, we'll have the inorganic impact coming from the acquisitions. Expect neuroscience overall to continue to grow.

Speaker #2: I'd like to thank our teams for all the progress made this year, and I look forward to seeing this momentum carrying into the next fiscal year.

Speaker #2: Speaking of '27, now turning to the guidance. I want to note there are full-year guidance, continues to include the diabetes business, as Medtronic remains the majority shareholder of Minimed, through the spin-off process.

Speaker #2: Today, we're guiding fiscal year '27 organic revenue growth of 6.75% to 7.25%, including approximately $11.5% to $12% organic growth in the first quarter. This guidance includes a roughly 25 basis points tailwind from the diabetes business.

Geoff Martha: To accelerate.

Thierry Piéton: To accelerate, yeah. Continuing in Neuroscience, in pelvic health. Look, Altaviva is off to a good start, and it's going to continue to grow into next year. You can see every single franchise in Neurosciences is going to accelerate going forward. If you look at MedSurg, look, MedSurg had a great quarter in Q4, with surgical being pretty strong around 3%, both US and OUS. We had great performance from ACM and from Endo. Look, I think that business has great momentum. We expect that growth to normalize a little bit, or we haven't reflected, I would say, the run rate that we see in Q4 fully in the guidance that we're taking into consideration for 2027. To finish with MiniMed, the team will comment more in detail in the following call after this. MiniMed had a strong Q4.

Out there if you take CST, you know, we have stealth access, uh, stealth access is, is off to a really good start, um, about, you know, 50% of the, of the revenue we get in CST is coming from consumables. And the more we sell stealth access, the more we're going to have pull through on the consumable side. And, and we're super excited about that. Um, in uh, in the neurovascular business, you know, you saw that, we made progress this quarter, that's going to continue into 27. We've got a ton of innovation coming there, uh, with um, with neural guard, uh, product and and with MMA, and that's going to continue going forward. And on top of that, we'll have the inorganic impact coming from from the Acquisitions. But expect Neuroscience overall to continue to, uh, to grow. Um, thanks to accelerate to accelerate. Yeah. Um, continuing in Neuroscience, you know, in public health, uh, I looked out to Viv as off to a good start and it's going to continue to grow into next year.

Speaker #2: It also incorporates the benefit from the additional selling week, which is recognized in the first fiscal quarter. We expected to contribute approximately $125 basis points to the full-year growth, and $500 to $600 basis points in the first quarter.

Speaker #2: Additionally, based on recent FX rates, we expect the foreign exchange to be a neutral to roughly $100 million headwind, for the full year. With an approximate neutral to $50 million tailwind to the first quarter.

So, you can see every single franchise in neurosciences, or is going to accelerate going forward. And then, if you look at Med surge, uh, look med, surg had a, a great quarter in Q4, uh, with surgical being pretty strong around 3%, both us and us, uh, we had great performance from a ATM and from Endo. Um, look. Um, I think that business has great momentum. Um, but but we expect that growth to, to normalize a little bit or we haven't reflected.

Speaker #2: Moving down the P&L, we expect our fiscal '27 margin to be roughly in line with the previous year, excluding tariffs. Pricing and COGS efficiency programs are expected to offset the impact of business mix, primarily from diabetes.

Thierry Piéton: We expect continued strength into 2027, and MiniMed should bring about sort of 20 to 25 basis points of growth in the construction next year. Look, all in all, if you look at what happened in 2026, we started the year with a 5% guidance. Gradually, we increased it to 5.5%. We ended the year at 5.8%. The midpoint of our guidance this year for 2027 is right at that level, 5.8%. I think we're positioning the business for success going into this year.

Speaker #2: This pressure point will disappear upon separation. We anticipate a tariff impact to COGS of approximately $250 million, in total, including $75 million in the first quarter.

Speaker #2: Including tariffs, we expect fiscal year '27 gross margin to decrease by roughly 20 basis points. We continue to invest in innovation to accelerate the launch of key products.

I would say the 1, right, that we see, in Q4 fully and the guidance that that we're taking into consideration for the 27. And then to finish with our with mini mad, you know, the T-Mobile comment more in detail, the following call after this, uh, but, uh, Mini Med had a strong Q4. We expect our continued strength into 27 and match should bring about sort of 20 to 25 phases of growth in construction next year. So, look, all in all. Um, you know, if you look at what happened in 2016, we started the year with a 510 guidance gradually, we increased it to 5.5, we ended the year at 5.8 midpoint of our guidance. This this year, is for 27, is right at that level 5.8. So I think we're positioning the business process going into into this year.

Vijay Kumar: Hey, thanks for a very comprehensive answer. Maybe I'll limit myself to one and pass it on to others. Thank you.

Speaker #2: This includes incremental spend, as we integrate several acquisitions. Overall, we expect our fiscal '27 operating margin to be up 60 basis points, driven by the absence of Blackstone milestone payments we saw this year, and operating leverage.

Hey, uh, thanks for the comprehensive answer. Maybe I'll limit myself 1 in passed on to others. Thank you. Thank you.

Geoff Martha: Thanks, Vijay.

Ingrid Goldberg: Thank you. Our next call comes from Larry Biegelsen at Wells Fargo. Larry, please go ahead.

Thank you on our next. Call comes from. Larry biegelsen at Wells, Fargo. Sorry, please go ahead.

Larry Biegelsen: Good morning. Thanks for taking the question. Geoff, congrats on a strong finish here. Geoff, I'm going to ask the one question I think that one area people are concerned about, which is your TAVR business. The Evolut six and seven-year data did get a lot of attention this year, or earlier this year, sorry. What did you see from a share standpoint in your TAVR business in fiscal Q4? Was there any differences, US versus international? What are you assuming for your TAVR business in fiscal 2027? Thanks for taking the question.

Speaker #2: Below the operating profit line, we're expecting an approximate $200 basis points headwind, driven by an increase in net interest expense, as well as a slightly higher tax rate.

Speaker #2: We're guiding '27 EPS of $5.90 to $6. Fiscal year '27 incorporates several dynamic components, and I would like to be explicit around our assumptions on the inputs.

Uh, good morning. Thanks for taking the question cuts on a on a strong this year. Jeff, I'm going to ask the 1 question. I I think that 1 area of people are concerned about which is your table business. Um, you know, the evolute, 6, and 7 your data did get a lot of attention this year. Um, what, what did you see or earlier this year sign, what what did you see from a shares standpoint in your table or business in in physical keyboard? Was there any differences? You know, us versus International?

Speaker #2: We have included an approximate $150 basis points benefit from the extra selling week to the full year. Because we do not yet know the timing of the Minimed separation, we're taking a conservative approach and including the full year of the diabetes business in our estimates, including the associated monthly dilution and assuming no separation share count benefit in fiscal '27.

Geoff Martha: No, thanks for the question, and, Larry, I'd say, I know there's been a lot of talk on TAVR and Evolut. I'll say this. Just to repeat what Thierry said a second ago, the business has stabilized, right? Over the last eight to 10 weeks, it's been stable. We did experience a slowdown in growth, and it really was tied, we believe, to the low-risk data that came out. It's more of a US dynamic, I would say. I just want to emphasize it's an older technology. It's an old procedure. The procedure tactics we've changed, and it's limited to a large size valve, which is more used in the United States. It's not really impacting us outside the US like it is in. It's stabilized, and we're moving forward now. We're heavily investing into this business. We announced a big investment last quarter.

Speaker #2: Should we separate prior to year-end, as per our intent, we could see potential upside from our current guidance. We're factoring 2% dilution from M&A, which is roughly 1 point higher than what we shared last quarter, as the timing of several of our deals actually occurred earlier than anticipated.

Speaker #2: We're taking the full tariff impact of $250 million, as mentioned previously, and increased of $65 million versus prior year. We have not taken into consideration any government refund.

And what are you assuming for your table or business? You know, in fiscal 27. Thanks for taking the question. Yeah, no. Thanks for the question. And, uh, Larry, I, I'd say, I know there's a lot of talk on on Tabor and evolute. I, I'll say this. Um, just just to repeat what Terry said a second ago. The, the business has stabilized right? Um, over the last, you know, 8 to ten weeks. Um, it it's been and it's been stable, um, you know, we did did experience a Slowdown in growth and it really was tied, We Believe to the, to the, the low-risk data that came out. It's more of a US Dynamic. I, I would say, I mean again I just want to emphasize it's it's, you know, kind of old, it's an older technology. It's an old uh procedure. Uh that, you know, the procedure tactics we've we've changed and, uh, it's limited to a large size. Um, you know, valve, which is more used in the United States. So it's not really impacting us outside the US like it is in its stabilized and we're moving forward now, right?

Speaker #2: We've embedded also a roughly 1 point headwind from increased fuel and transportation costs, due to the conflict in the Middle East. And finally, based on recent FX rate, we expect foreign exchange to have a neutral to 1% accretive impact for the full year.

Geoff Martha: We're investing in this DASI software, where we've got mitral and tricuspid. We're feeling good going forward. We got some new, fresh leadership there that's running fast. I don't know if you have anything to add to that, Thierry, in terms of next year.

Speaker #2: For the first quarter, we would expect EPS in the range of $1.38 to $1.40, including a $600 to $700 basis points benefit, from the extra selling week, as well as roughly neutral impact from foreign exchange at recent rates.

Thierry Piéton: No, I would just say, look, in Q4, we grew 6.6% despite the headwind that we had from TAVR, and particularly in the US, as you said, Geoff, and what we've seen over the last eight weeks is a stabilization of that business, and that's what we've modeled going forward.

So, we're heavily investing into this business. Uh, you know, we, we announced the, you know, a big investment last quarter. Uh, we're investing in in this, classy software where we've got mitral and tricuspid. Um, and so we're, we're, we're feeling good going forward. We got some, some new fresh leadership there. That's, uh, you know, running fast and, um, so I, I don't know if anything to add to that too. In terms of next year? No, I would, I would just say, look in in Q4, we grew 6.6%, despite the headwinds that we had, from Tower in particular in the US as you

Said Jeff, and what we've, uh, what we've seen over the last eight weeks is a stabilization of that business, and that's what we've modeled going forward.

Speaker #2: Look, all of this taken together, our approach to guidance for the full fiscal year positions us well for a strong performance in 2027. And with that, back to you, Jeff.

Geoff Martha: Yeah.

Larry Biegelsen: Thank you.

Ingrid Goldberg: Okay. Our next question comes from Travis Steed at Bank of America. Travis, go ahead.

Steven, Bank of America. Travis, good.

Travis Steed: Hey, thanks for the question. I'll start with MedSurg grew 5% this quarter. Surgery grew 3% this quarter. Maybe it's how you factor these businesses in, as you talked about accelerating growth next year into the guidance and to keep these businesses at kind of these higher growth levels. Hugo, when does that start to show up on the surgery growth and when do you expect Hugo to start contributing positively to the margin and EPS profile versus being an R&D investment and how to think about the return on that program?

Speaker #1: Okay, thanks, Jeri. Now, as we come to a close, I'd like to take a step back. The macro backdrop, as you know, has been challenging and dynamic.

Speaker #1: But MedTech is structurally resilient. Because the fundamentals are durable, people are living longer, chronic disease is rising, and the demand for medical procedures will only grow.

Speaker #1: AI, digital, robotics, as well as advanced electronics, are meaningful accelerants. And at Medtronic, we are uniquely positioned to integrate these technologies for safer care, improved outcomes, and stronger healthcare economics that scale globally.

Hey, thanks for the question. Um, I'll start with, you know, that surge grew 5%, this quarter surgery, grew 3%, this quarter, maybe how you factor these businesses in, you know, as you talked about accelerating growth next year, uh, as a guidance and to keep these businesses, uh, kind of these higher growth levels and and on Hugo, when, when does that start to show up on, on the surge of growth? And, you know, when do you, when do you expect to go to start contributing, positively to, to the margin and EPS profile versus being on an R&D investment, and have to think about the return on that program?

Geoff Martha: Well, look, I'd say first of all, on MedSurg, it was a great quarter, and it was pretty much across the board, right? The surgical business accelerated to 3%, as Thierry just pointed out. You have ACM at nearly 11%, our Endo business at 9%. Mike Marinaro and the team have done a great job building this. Like I said, it was a great quarter. In there, Hugo contributed, right? We had told you that we thought Hugo would have an impact towards the end of FY26, and it did in Q4. We're feeling really good about the feedback we're getting on the launch. We announced this morning the submission to the new indications, general surgery, GYN, and LigaSure RAS. We've got those submitted, and the feedback we're getting on the early cases is good. We're seeing the smooth case rate is up.

Speaker #1: I also want to take a moment to recognize Brett Wall. He will be leaving Medtronic this summer, following an extraordinary 25-year career. Brett has been an integral part of our leadership team, and played a defining role in shaping our neuroscience portfolio.

Speaker #1: Including helping establish interventional stroke as a global standard of care and advancing innovation across neuromodulation. His impact on patients, on our strategy, and our culture has been significant.

Speaker #1: And we are deeply grateful for his contributions. As part of this planned transition, Dr. Qualey Thompson will step into the role of executive vice president neuroscience portfolio.

Geoff Martha: That means how many cases. If everything goes well in a case, that's really important, especially in the US where the physicians really test the system. Our procedures are meaningfully up. Utilization continues to be strong. We've got digital placements, installations in the US, outside of the US. Complementary to this is our touch surgery platform. Its installs are up 30% sequentially. We're now in over 1,400 ORs globally. This is going to be a real differentiator. I want to get to the point where we're talking about the enabling technology, not just Hugo, but all the enabling technology, including the digital piece, kind of like we do in spine with AiBLE. That's what we're building to. Obviously, Hugo's a big piece of that. We're feeling very positive right now. I don't know if you have anything to add to that.

Well, look, I I'd say, first of all, on on med surg it was a a great quarter and it was pretty much a across the board, right? You a surgical business accelerated to to 3%, as Terry just pointed out, uh, you have ACM at, you know, nearly 11% our Endo business at 9%. I mean, Mike, Marinaro and the team have done a great job, uh, building this. Uh, and like I said, it was a great quarter and and in their Hugo contributed, right? We said we, we had told you that we thought Hugo would have an impact and towards the end of FY 26 and it did in Q4 um it you know it's it's you know we're feeling really good about the feedback we're getting on the launch. We announced this morning you know that the the submission to the new indications general surgery gone and Legos Shore Ras. So we've got those submitted and the feedback we're getting on the um you know the early cases is good you know we're seeing you know the smooth case rate is up uh you know that means how many cases

Speaker #1: Qualey is an approved leader with a strong track record of execution and deep clinical and operational experience, most recently leading our CRM business. He is well positioned to lead neuroscience into its next phase of growth.

Is, you know, everything goes well, and a case that's really important, especially in the US where the Physicians really test the system. Our procedures are meaningfully up and utilization, can you continues to be strong? Uh we've got additional placements, installations in the US out outside of the US.

Speaker #1: Again, we want to thank Brett for his leadership, and we look forward to Qualey's continued impact. So we delivered a strong finish to the year, powered by the breadth of our portfolio and disciplined execution across the business.

Um and and and complimentary to, this is our touch surgery. Platform is installs are up 30% sequentially. We're now in over, you know, 1400 OS globally. This is going to be a real differentiator you know, I want to get to the point where we're talking about the enabling technology. Not just Hugo but all the enabling technology, including the digital piece, kind of like we do with in spine with Abel. That's what we're building to obviously Hugo's a big piece of that. So we're we're feeling we're feeling very positive right now. I feel I need to add to that. I think you said it on Jeff.

Thierry Piéton: I think you said it all, Geoff.

Great. Thank you.

Travis Steed: Great. Thank you.

Thanks Travis.

Ingrid Goldberg: Thanks, Travis. Our next question comes from Ryan Zimmerman at BTIG. Ryan, go ahead.

Speaker #1: And look, we are not letting up. We are investing in the future. We are building momentum in our key growth areas, advancing innovations across the portfolio, and deploying capital through targeted M&A, ventures, and partnerships.

All right, our next question comes from Ryan Zimmerman at btig, Brian. Go ahead.

Are you okay?

Ryan Zimmerman: Can you hear me okay?

Yep, we can hear you, Ryan.

Geoff Martha: Yep.

Thierry Piéton: Yep.

Geoff Martha: We can hear you, Ryan.

Ryan Zimmerman: Wonderful. Thank you. A lot of directions to go here, I'm actually going to ask a little bit of a margin question to Thierry. Assuming you lap some of these tariff dynamics kind of midway through fiscal year 2027, potentially MiniMed is coming off. Again, I appreciate that you're including it for the full year, it would seem that there is opportunity potentially for a gross margin step-up, particularly in the H2 2027. Is there anything else that we should be considering in terms of constraining gross margins as we think about it in the context of the 2027 guide? Thanks.

Speaker #1: Together with strong commercial execution and market development, these actions give us confidence in our ability to deliver durable, innovation-led growth for FY '27 and years to come.

Speaker #1: With that, let's turn to Q&A. Ingrid, can you please provide the instructions and cue up the analysts?

Wonderful. Thank you. So um a lot of directions to go here but I'm actually going to ask a little bit of a margin question to Terry. Um, you know, assuming you laugh some of these tariff Dynamics kind of Midway through fiscal year 27, you know, potentially many med is coming off and then again, I appreciate that you're including it for the full year but it would seem that there is opportunity for potentially, for a gross margin to step up in 2020, particularly in the second half of 2027. And so, is there anything else that, you know, we should

Speaker #3: So the sell-side analysts that would like to ask a question, please select the participants button and click raise hand. If you're using the mobile app, press more and select raise hand.

Cons. Considering in terms of constraining gross margins. As we think about it in the context of the 2027 guide. Thanks.

Thierry Piéton: No. Look, I think the dynamics in the gross margin are pretty similar to what we've seen so far. Kind of peeling through the different parts. We'll have negative impact from the carryover of the tariffs issue, or the tariffs topic, I should say, in the H1.

Speaker #3: Your lines are currently on mute, and when called upon, you'll receive a request to unmute your line, which you must respond to before asking your question.

Speaker #3: Finally, please be advised that this Q&A session will be recorded. We'll pause for a few seconds to assemble the queue. We'll take our first question from Vijay Kumar at Evercore.

No, so look, I I think you, you know, the Dynamics in the gross margin are are pretty similar to to what we've we've seen so far. So, you know, kind of peeling through the different parts. We we'll have negative impact from the carryover of the tariffs issue or the tariffs topic I should say, in the first half kind of garbage time

Larry Biegelsen: Kind of garbage time anyway.

Thierry Piéton: To the tune of.

to the, to the tune of

Larry Biegelsen: Is that you?

Thierry Piéton: There's someone else that's on the line, sorry. Yeah. We'll have about $65 million of carryover coming from tariffs in Q1 and Q2, to your point. We'll lap that in H2. If you look at excluding tariffs operationally, we expect to continue to see pricing lift as we did in 2026. We expect to continue to see good traction from a cost of goods sold, net cost out perspective. The team is gradually netting out better and better performance of cost out net of inflation, and we expect that to continue. We've got the mix topic, and as you know, there are two drivers behind that. One is diabetes.

Speaker #3: Vijay, please go ahead.

Speaker #4: Hey guys, thank you for taking my question. And Jeff, congrats on a nice sprint share. Maybe Jeff, I'll start with the guidance question. Fiscal '27, excluding the extra week, I think underlying 5.5 to 6, that's an acceleration in line with that prior assumptions.

Speaker #4: I think as cash flows down, that's been a concern for the market, right? Can you just talk about what are the offsets? What segments accelerate to offset cash in drives the confidence in this 5.5 to 6 organic?

Speaker #1: Well, thanks for the question, Vijay. Maybe I'll let me just start with the cash comment you made, and then I'm going to turn it over to Tierney to answer the ins and outs, so puts and takes of the guidance question.

Thierry Piéton: To your point, if we are to separate diabetes before the end of the year, which is our intent, then we should see some lift in the gross margin rate coming from that. The other dimension of the mix impact is coming from CAS. It's actually getting better because the margin of CAS is improving, and so we should see that being less of a headwind going into H2. Look, all in all, what we've embedded in the guidance here is a gross margin that's basically flattish, slightly up excluding tariffs, or I would say very slightly up excluding tariffs, with a better performance in H2 than in H1.

Speaker #1: But on cash, look, the impact of cash to our growth will be very similar next year, to this year. I mean, we see the market in FY '27 growing well, first of all, in Q4, we think the cash market grew around 20%.

As someone else that's on the line. Sorry. So um yeah. So we'll have about 65 million of carryover comp coming from tariffs in the first quarter and the second quarter to your point will lap that in the second half. And then if you look at excluding tariffs operationally, we expect to continue to see pricing lift as we did in 26. We expect to continue to see good traction from our a cost of goods sold. Um uh net cost out perspective, you know, the team is gradually uh netting out better and better performance so of cost out net of inflation and we expect that to continue. Then we've got the mixed topic and as you know, there are there are 2 drivers behind that 1 is diabetes to your point. You know, if we are to separate diabetes before the end of the year, which is our intent. Then we should see from some lift in the gross margin rate coming from that. And then, uh, you know, the the other dimension of of the mix in fact, is coming from Cass. It's actually getting better, uh, because the margin of cash is in

Speaker #1: In FY '27, we're thinking mid to high teens market growth. And we're going to grow north of a two times that of the market rate.

Speaker #1: And again, the business has gotten a lot bigger, so its contributions to our growth are even more, because of the size. And yeah, so we're annualizing that business is annualizing now $2 billion.

Thierry Piéton: The good news is growth is accelerating, and with growth, we're getting operating margin leverage with better absorption of the overhead, and this will come primarily from the SG&A line going into this year. We'll have accretion in operating margin, in particular in H2 of the year.

Speaker #1: We're going to hit that $2 billion backward-looking revenue mark that I laid out there. We're going to hit that in Q1. That implies we're about 15% share right now in marching towards market leadership and cash.

The good news is our growth is accelerating, and with growth, we're getting operating margin leverage with better absorption of the overhead. This will come primarily from the SG&A line going into this year. So, yeah, we'll have accretion in operating margin, in particular in the second half of the year.

Thank you. Nice. Then, to the year...

Ryan Zimmerman: Thank you. Nice end to the year.

Speaker #1: So I don't we're not look, we're not talking about cash slowing down. Its impact on our growth. I just laid out what I think it'll grow, but the impact is strong.

Ingrid Goldberg: All right. Our next question comes from Joshua Jennings at TD Cowen. Please go ahead, Josh.

All right, our next question comes from. Josh Jennings at TD Cowen.

Please go ahead. Josh.

Joshua Jennings: Hi. Good morning. Thanks for taking the question. I was hoping to just get a bead on the China franchise, not the sexiest question here, but historically China's been a growth channel. There've been some headwinds with VBP for a couple business years, but what's the outlook for 2027? Maybe help us think about exposure there as a percentage of revenue, and is the China franchise going to be accretive or dilutive to the organic revenue growth guidance? Thanks for taking the question.

Good morning, and thank you for taking my questions.

Speaker #1: So I just want to clarify that first, and then maybe Tierney, you talk about the guidance.

I was hoping to just, uh,

Speaker #5: Sure. Hi, Vijay. So look, just maybe to give you a couple of components of the growth rate here. So the cardiovascular business should have a performance next year that's pretty much in line with what we've seen in '26.

get a bead on the China franchise—not the sexiest question here, but

Speaker #5: So it's in it's got really, really strong momentum. Jeff just talked about cash. We're clearly still in the early innings of the cash development here.

You know, historically China's been a growth Channel, there have been some headwinds of bbp for a couple of positions, but what what's the outlook for for 2027, maybe help us think about exposure there as a percentage of Revenue and and is that is the China franchise going to be a creative or diluted to the organic Revenue growth guidance? Thanks for taking the question.

Speaker #5: You probably saw in the commentary that from an install-based perspective, the install base was up 40% in the fourth quarter alone. So that gives us a ton of headroom to grow the catheter sales going forward.

Geoff Martha: Look, thanks for the question, Josh. We haven't gotten a China question in a while. Look, we still view China as a growth market. When we think about China, we think about it as an end market. We don't have a whole lot of exposure in terms of manufacturing in China for export outside of China, so we don't really have much exposure there. That's very small. It's really about how it continues to be a profitable growth market for the company. Look, we've had to navigate a number of these VBP, and I think VBP is here to stay, but we think the worst is behind us, and the team's navigated it well.

Speaker #5: CRM will continue to be a strong mid-single digit. We have a lot of strength coming from innovation, from Micra, from Omnia. From EVICD, and that's going to carry into '27.

Um, look, thanks for the question, Ash. We haven't gotten a China question in a while. Look, China is—we still view China as a growth market. So, we think about China, we think about it as a growth market. As an end market, we don't have a whole lot of exposure in terms of manufacturing in China for export outside of China. So we don't really have much exposure there; that's very small. It's really about—

Speaker #5: And then staying in the cardiovascular portfolio, we expect to continue to see some strong lift coming from Ardian. So Ardian is now annualizing about $100 million revenue a year.

Speaker #5: And we expect that to continue to grow significantly into '27 and beyond. And then we've incorporated a prudent guidance for structural heart. As we mentioned in the commentary, the business has been pretty stable over the last weeks.

Geoff Martha: We've been able to increase the procedures and lower our costs because we're on these big contracts, these big tenders, and we've been able to pull out costs, increase volume, even though pricing's down, and it remains growing at the corporate average right now, and that average for the company is improving, as you see. Profitability is also strong. For years, there's been this misconception that China's not profitable. Prior to VBP, I admit it was even more profitable, but it's still accretive from a profitability standpoint, and it's a growth region for the company.

Speaker #5: And that's what we've incorporated in the guidance going forward. So strong continuation in cardiovascular. Then we've got the neuroscience portfolio hey, look, in neuroscience, we're leading in every segment we're in, and we're gaining share.

Speaker #5: And on top of that, we've got meaningful innovation in almost every segment out there. If you take CST, we have stealth access. Stealth access is off to a really good start.

How it continues to be a profitable growth market for the company. And look, we've had to navigate a number of these, you know, vbp and and I think vbp is here to, you know, to stay. But we have the worst is behind us and uh, We've the team's navigated it. Well, we've been able to, you know, increase the procedures and lower our costs, because we're on these big contracts, these big tenders and we can be able to pull out costs, increase volume, even though pricing is down and it remains, you know, growing at the corporate average right now and that average for the company is, is improving as you see. Uh, and and profitability is also, uh, strong. Uh, you know, for, for, for years, there's been this misconception that that China is not profitable, you know, prior to vbp. I I admit it was even more profitable, but it's still, you know, a creative from a profitability standpoint and it's, and it's a growth. It's a, it's a growth, um, region for, for the company.

Speaker #5: About 50% of the revenue we get in CST is coming from consumables. And the more we sell stealth access, the more we're going to have pull-through on the consumables side.

Okay.

Joshua Jennings: Okay.

All right.

Ingrid Goldberg: All right. Next up, we have David Roman from Goldman Sachs. David, go ahead.

Speaker #5: And we're super excited about that. In the neurovascular business, you saw that we made progress this quarter. That's going to continue into '27. We've got a ton of innovation coming there.

Next up, we have David Roman from Golden Sachs,

David. Go ahead.

David Roman: Thank you, Ingrid. Good morning. I wanted just to come to the comment you made on CAS during the prepared remarks. I think you talked about visualizing other catheters on Affera, and how you were thinking about integration of some of the investments you're making on expanding the accessory business within CAS, as well as the potential to integrate some of the other established technologies onto Affera. Then maybe we'll just ask my follow-up front here. I know, Thierry, you talked about tariffs as you reflected in the guidance, but there do seem to be a lot of other unresolved considerations on tariffs such as USMCA and then 232. Maybe just your latest updated thoughts there would be helpful.

Speaker #5: With Euroguard product and with MMA, and that's going to continue going forward. And on top of that, we'll have the inorganic impacts coming from the acquisitions.

Speaker #5: But expect neuroscience overall to continue to grow. Staying to accelerate. Yeah. Continuing in neuroscience, in pelvic health, look, AltaViva is off to a good start, and it's going to continue to grow into next year.

Speaker #5: So you can see every single franchise in neuroscience is going to accelerate going forward. And then if you look at MedSurge, look, MedSurge had a great quarter in Q4, with surgical being pretty strong around 3%, both US and OUS.

Uh, thank you angry. Uh, good morning. Uh, I wanted just to come to the, a comment you made on CIS during the prepared remarks. I think you've talked about, uh, visual visual visual visualizing, excuse me, other catheters on aera and how you were thinking about integration of some of the Investments you're making, uh, on an expanding the accessory business within casts, as well as the potential to integrate some of the other established Technologies onto aera. And then, they would just ask my follow-up front here. I know try. You talked about tariffs, uh, uh, uh, as you reflected in the guidance, but there do seem to be a lot of other unresolved considerations, on tariffs such as usmca and what, and, and then 232. So maybe just your latest updated thoughts. There would be would be helpful.

Geoff Martha: Well, first on CAS, or on our Affera platform, we look at it as a three-in-one kind of. We view it as the premier platform out there. I think the numbers are bearing that out. We've worked hard to get to this point, and we're still in the early innings of the launch of Affera in the US, as Thierry pointed out, and globally. There's a couple vectors of growth. One is the innovation you pointed out. We're really surrounding electrophysiologists. We have more catheters coming out, Sphere-360s in Europe. We started the trial in the US for single shot that goes right at our biggest competitor. The mapping, we just launched our second-generation mapping software, and as you pointed out, David, it's got this ability to pick up other catheters.

Speaker #5: We had great performance from ACM and from Endo. Look, I think that business has great momentum. But we expect that growth to normalize a little bit, or we haven't reflected I would say the run rate that we see in Q4 fully in the guidance that we're taking into consideration for '27.

Speaker #5: And then to finish with Minimed, the team will comment more in detail in the following call after this. But Minimed had a strong Q4.

Speaker #5: We expect continued strength into '27. And Minimed should bring about sort of 20% to 25 basis points of growth in the construction next year.

Well, first off on, on on Cass. I mean, or on our Our Fair platform, like we look at it as a 3 in 1, you know, kind of we view it as the premier platform out there. Right. And I think the numbers are bearing that out um, and we, you know, we've worked hard to get to this point and we're still in the early Innings of of, of the launch of a Farah in the US, a series, 1 and globally. And there's a couple vectors of growth. 1 is the Innovation you pointed out, we're really surrounding electrophysiologists. Uh, so we have more catheters coming out fearlessly 60s in Europe. We started the trial in the US for single shot. That goes right out our biggest competitor. Um the mapping. Uh we just launched our second generation mapping software and

Speaker #5: So look, all in all, if you look at what happened in '26, we started the year with a 5% guidance, gradually we increased it to 5.5%.

Geoff Martha: We've made two investments in ICE catheter companies, so we're going to build out our ecosystem and surround the EP. In terms of if your question is about are we opening the system, I don't think we have plans for that right now. We're really building out our proprietary technology and ensuring that we have that tight workflow. That is our plan, to have that tight workflow and get the best clinical outcomes and the best experience for the physicians.

Speaker #5: We ended the year at 5.8%. The midpoint of our guidance this year is for '27 is right at that level, 5.8%. So I think we're positioning the business for success going into this year.

Speaker #1: Hey, thanks for a very comprehensive answer. Maybe I'll limit myself to one and pass it on to others. Thank you.

Speaker #4: Thanks, Vijay.

Speaker #6: Thank you. I'm going to next call comes from Larry Beagleson at Wells Fargo. Larry, please go ahead.

As you pointed out David it's got this uh ability to to sense. Uh other cat, pick up other catheters. Uh and then we're bring bringing in. We just made 2 investments in in ice catheter companies. So we're going to, you know, build out our ecosystem and surround the, you know, the EP in terms of the questions about how we opening the system. I don't think we have plans for that right now. I mean, it's, you know, you know, we're really building out our propriety, uh, proprietary technology and ensuring we have that tight workflow. Uh, that is our, our plan, uh, to have that type workflow and, um, get the best best clinical outcomes in in the phys. The best, uh, experience for the for the Physicians.

Thierry Piéton: On the tariff side, I think we mentioned it in the commentary. Look, we continue to monitor the environment there, which is still a little volatile, as you mentioned. I think we continue to look at the Section 232 situation. On the flip side, we've incorporated sort of a status quo in tariffs. We haven't incorporated any potential upside from reimbursements that could occur, and which we have applied for. We took a balanced approach on it, I would say.

Speaker #7: Good morning. Thanks for taking the question. Jeff, congrats on a strong finish here. Jeff, I'm going to ask the one question I think that one area people are concerned about, which is your TAVR business.

Speaker #7: The Evolute six and seven-year data did get a lot of attention this year. What did you see earlier this year? Sorry. What did you see from a share standpoint in your TAVR business in fiscal Q4?

Speaker #7: Was there any differences? US versus international? And what are you assuming for your TAVR business in fiscal '27? Thanks for taking the question.

Mentioned it in the commentary. Look, we we continue to to monitor, you know, the environment there, which is still a little volatile as as as you mentioned. I think we continue to, to look at the 232 uh um, situation on the flip side, you know, we've Incorporated the status quo intact so we, we have Incorporated any potential upside from reimbursements that that could occur and which we have applied for. So we we we we took a balanced approach on it. I would say

Ingrid Goldberg: Thanks, David. Our next question comes from Robbie Marcus at JPMorgan.

Speaker #4: No, thanks for the question. And Larry, I'd say and there's been a lot of talk on TAVR and Evolute. I'll say this. Just to repeat what Tierney said a second ago, the business has stabilized, right?

Thanks David. Our next question comes from Robbie Marcus. JB Morgan.

Robbie Marcus: Great. Good morning. Thanks for taking the questions. Two quick ones from me. Geoff, I wanted to ask on MiniMed. I see consensus numbers have strong organic sales growth, margin, and free cash flow improvements over the coming years. If that's the case, can you just remind us what's the rationale for separating it here? Wouldn't you want to keep a business with strong improvements and inflections in profitability and growth going forward?

Great. Uh, good morning. Thanks for taking the question. Um, two quick ones for me. Um,

Speaker #4: Over the last eight to 10 weeks, it's been stable. We did experience a slowdown in growth, and it really was tied, we believe, to the low-risk data that came out.

First, uh, Jeff, I wanted to ask about many med.

You know, I see consensus numbers have strong organic sales growth, margin, and free cash flow improvements over the coming years.

Speaker #4: It's more of a US dynamic, I would say. I mean, again, I just want to emphasize it's kind of an older technology. It's an old procedure.

It—it's the case. Can you just remind us, what's the rationale for separating it here?

Speaker #4: The procedure tactics we've changed. And it's limited to a large size. Valve, which is more used in the United States. So it's not really impacting us outside the US.

When you want to keep a business with strong improvements and inflections in profitability and growth going forward.

Um, look, I mean, we—we...

Geoff Martha: Look, we're separating it not because of our confidence in the outlook of the business. To your point, we think it's doing well today, and it's going to accelerate from here with the product pipeline that they have, which I'm sure Q will give updates on the call after this. It's the best we've seen, and it's comprehensive across all aspects of managing insulin-dependent patients. We feel really good about that. I think as we focus, we have a lot of growth drivers to focus on. These other growth drivers that we talked about today, whether it be CAS or Ardian, Hugo, Altaviva, Stealth Access, all of them, I think, take more advantage of and benefit from either technology platforms that cut across the company, especially in robotics and areas like that, or our commercial footprint, where MiniMed does not really capitalize on that as much.

We're separating it, not because of our, um, confidence.

Speaker #4: Like it is in it's stabilized. And we're moving forward now, right? So we're heavily investing into this business. We announced a big investment last quarter.

Speaker #4: We're investing in this DOSI software, where we've got Mitral and Tricuspid. And so we're feeling good going forward. We've got some new fresh leadership there that's running fast.

Speaker #4: And so I don't know if you have anything to add to that, Tierney, in terms of next year.

Speaker #5: No, I would just say, look, in Q4, we grew 6.6% despite the headwind that we had from TAVR, in particular in the US, as you said, Jeff.

Speaker #5: And what we've seen over the last eight weeks is a stabilization of that business. And that's what we've modeled going forward.

Speaker #6: Yeah.

Speaker #7: Thank you.

In the Outlook of the business, I mean, to your point. We think it's going to, it's going to do really. It's doing well today, and it's going to accelerate from here with the product pipeline that they have, which I'm sure Q will give updates, uh, on the call after this. I mean, but it's, it's the best we've seen, and it's comprehensive across all aspects of into of management insulin, independent, or insulin dependent patients. So we feel really good about that. Um, you know, I think as we focus we have a lot of growth drivers to focus on and these other growth drivers that we talked about today. Whether it be Cass or are already in um you know, Hugo Alta, Viva self assess all of them. I think take more advantage of and benefit from um

Speaker #6: OK. Our next question comes from Travis Deed at Bank of America. Travis, go ahead.

Speaker #7: Hey, thanks for the question. I'll start with MedSurge grew 5% this quarter. Surgery grew 3% this quarter. Maybe it's how you factor these businesses in.

Speaker #7: As you talked about accelerating growth next year, into the guidance and to keep these businesses at kind of these higher growth levels. And on Hugo, when does that start to show up on the surgery growth?

Geoff Martha: The second is, look, we're very disciplined around capital allocation. It's hard to constantly allocate capital to something, even though the growth is there. The rest of Medtronic's growing much faster now. The gap between MiniMed and the rest of Medtronic isn't as much as it used to be in terms of growth. In profitability, though, it's just a structurally lower profitable segment. It's kind of hard to allocate capital that way. I think both businesses will do better separated. For our own reputation and patience, we think we're separating at the right time. We've put a lot of time and money into the business. It's ready to go. It's got a great management team, and it's going to do well for patients, it's going to do well for physicians, and it's going to do well for shareholders.

Tech either technology platforms that cut across the company especially in robotics and areas like that or uh our commercial footprint where Mini Med does not uh really you know, capitalize on that as much. And and the second is look, we're we're very disciplined.

Around Capital, allocation.

Speaker #7: And when do you expect Hugo to start contributing positively to the margin and EPS profile versus being an R&D investment and having to think about the return on that program?

And it's, it's hard to constantly allocate Capital to something, even though the the growth is there. But the rest of the metronics growing much faster. Now, so the gap between Mini Med and and the rest of Medtronic isn't as much as it used to be in terms of growth.

Speaker #4: Well, look, I'd say, first of all, on MedSurge, it was a great quarter. And it was pretty much across the board, right? The surgical business accelerated to 3%, as Tierney just pointed out.

Speaker #4: You have ACM at nearly 11%. Our Endo business at 9%. I mean, Mike Marinero and the team have done a great job building into this.

And profitability, though it’s just a structurally lower profit, uh, profitable, you know, segments. And so it’s kind of hard to allocate capital that way. I think both businesses will do better separated, um, and we've, you know, for our own reputation and patience, we've…

Speaker #4: And like I said, it was a great quarter. And in there, Hugo contributed, right? We had told you that we thought Hugo would have an impact towards the end of FY '26, and it did in Q4.

Geoff Martha: The rest of Medtronic, we're accelerating, and we're going to do well as well. We're feeling really good about that decision and excited about the future of both organizations.

Speaker #4: It's we're feeling really good about the feedback we're getting on the launch. We announced this morning the submission to the new indications general surgery guide.

We did not—we think we're, um, separating at the right time. We've put a lot of time and money into the business. It's ready to go. It's got a great management team, and it's going to do well for patients, it's going to do well for physicians, and it's going to do well for shareholders and the rest of Medtronic. We're accelerating, and we're going to do well as well. So we're feeling really good about that decision, um, and excited about the future of both organizations.

Speaker #4: And LigaSure, RAS, so we've got those submitted. And the feedback we're getting on the early cases is good. We're seeing the smooth case rate is up.

Robbie Marcus: Fantastic. Maybe a quick one. Thierry, I look at consensus. I realize you just guided to fiscal 2027. I look at consensus for 7% EPS growth for 2028, realizing there is one fewer selling week, which is 150 plus basis points to EPS this year. Should we be thinking about a similar headwind next year? How do you want people to think about the year to year there, just so we could get it correct at this update? Appreciate the questions.

Speaker #4: That means how many cases everything goes well in a case. So that's really important, especially in the US, where the physicians really test the system.

Speaker #4: Our procedures are meaningfully up, and utilization can continues to be strong. We've got additional placements installations in the US, outside of the US. And complementary to this is our touch surgery platform is installs are up 30% sequentially.

Fantastic. Maybe a, a quick 1, Terry. I look at consensus, I I realize you just got to fiscal 27. I look at consensus for 7%, EPS growth for 2028. Realizing, there's 1 fewer selling week, which is 150, uh, plus basis points.

Speaker #4: We're now going over 1,400 ORs globally. This is going to be a real differentiator. I want to get to the point where we're talking about the enabling technology, not just Hugo, but all the enabling technology, including the digital piece, kind of like we do with InSpine, with Able.

Thierry Piéton: Thanks, Robbie. We'll give 2028 guidance when we give 2028 guidance. It's kind of early, just kind of directionally, some of the headwinds that we've got, like tariffs, et cetera, disappear going into 2028. We expect the growth to continue. We went through all the growth areas that we've got in the portfolio today, and a lot of these are in early innings. CAS is still going to continue to accelerate. Ardian is very early in its development. Altaviva is also very early. We've got a long list of innovation that's kicking in the rest of the portfolio. Yes, there will be pressure coming from the 53rd week going away, but we have a lot of things going the other way. We look forward to talking about that later in the year.

Speaker #4: That's what we're building to. Obviously, Hugo is a big piece of that. So we're feeling very positive right now, if you have anything to add to that.

Speaker #5: I think you said it all, Jeff.

Speaker #7: Great. Thank you.

Speaker #6: Thanks, Travis. All right. Our next question comes from Ryan Zimmerman at BTIG. Ryan, go ahead.

Speaker #8: Can you hear me OK?

Speaker #7: Yep, we can hear you, Ryan.

Speaker #8: Wonderful. Thank you. So a lot of directions to go here. But I'm actually going to ask a little bit of a margin question to Tierney.

Speaker #8: Assuming you lapped some of these tariff dynamics kind of midway through fiscal year '27, potentially Minimed is coming off. And then again, I appreciate that you're including it for the full year.

But we have a lot of things going the other way. So we look forward to talking about that later.

Great. Thank you for taking the questions.

Robbie Marcus: Great. Thank you for taking the questions.

Thierry Piéton: Okay.

Ingrid Goldberg: All right. Our last question, we have time for one more. It's going to come from Mike Kratky at Leerink Partners. Thank you.

David Roman: All right. Our last question, we have time for one more. It's going to come from Mike Kratky at Leerink Partners. Thank you.

Speaker #8: But it would seem that there is opportunity potentially for a gross margin step up in 2020, particularly in the second half of 2027. And so is there anything else that we should be considering in terms of constraining gross margins as we think about it in the context of the 2027 guide?

All right, and our last question—we have time for one more—is going to come from Mike Cracky at Ling Ling Partners. Thank you.

Mike Kratky: Awesome. Can you hear me all right?

Awesome, can you hear me all right? Yep, yep.

Geoff Martha: Yep.

Thierry Piéton: Yep.

Mike Kratky: Great. Thanks for taking my questions, and congrats on the strong quarter. Maybe just one quick one, in terms of your commercial strategy in mechanical thrombectomy, to what extent is Libero bringing differentiation to this market? How are you thinking about your ability to carve out share of the market with two well-intentioned competitors? What could that opportunity look like?

Speaker #8: Thanks.

Speaker #5: No, so look, I think the dynamics and the gross margin are pretty similar to what we've seen so far. So kind of peeling through the different parts, we'll have negative impact from the carryover of the tariffs issue or the tariffs topic, I should say, in the first half.

Great, so thanks for taking my questions, and congrats on the strong quarter. Maybe just one quick one, but in terms of your commercial strategy and, mechanically, from back to me—to what extent is Libra bringing differentiation to this market? How are you thinking about your ability to carve out share of the market with two well-entrenched competitors, and what could that opportunity look like?

Geoff Martha: We try not to guide at a product level, so I can't get too specific there. I do think we have a strong commercial footprint out in our peripheral vascular business, and this is a product we've worked on for a while, and we're getting great clinical results. Physician feedback is good. I think we're putting that product in the bag of our peripheral vascular business. Plus, we got this agreement with Contego that's also helping that business. Help me, what else is.

Speaker #7: Kind of garbage time.

Speaker #5: To the tune of someone else that's on the line. Sorry. So yeah, so we'll have about $65 million of carryover coming from tariffs in the first quarter and the second quarter.

Speaker #5: To your point, we'll lap that in the second half. And then if you look at excluding tariffs operationally, we expect to continue to see pricing lift, as we did in '26.

Speaker #5: We expect to continue to see good traction from our cost of goods sold net cost out perspective. The team is gradually netting out better and better performance of cost out net of inflation.

Yeah, like we're not, we don't we try not to guide at a product level, you know, so I can't get too specific there, but I do think, uh, it is it it, it, we have a strong commercial footprint out there in our proof of vascular business. And this is a, a product we've worked on for a while and it's gotten, you know, we're getting great clinical results, Physicians, give back is good. And I think, you know, we're putting that product in the bag of a peripheral vascular business, uh, plus. It's got, um, you know, we got this agreement, uh, with Contigo that's also helping that business and help me. What else is fine, too?

Thierry Piéton: It's fine, too.

Geoff Martha: No, that's peripheral vascular.

Thierry Piéton: Oh, peripheral.

Geoff Martha: Peripheral vascular. We've got a number of new products there. It's not just one thing. I'd look at the business and the direction of travel of the overall business, putting more competitive products in that scaled sales force. I appreciate the question, Mike. We don't get a lot of questions around peripheral vascular, but it's sneakily improving the growth profile, which is part of the exciting story of Medtronic. Because you've got these three groupings. You've got these big growth drivers that we are all talking about, like CAS, and now you're going to hear more about RDN and Hugo now, but both those guys had good Q4s. Then you got Altaviva and Stealth AXiS, these thoroughbreds coming out of the gate hot. Then you got our big businesses, CST, which we just talked about. Surgery is doing well, and cardiac rhythm is just crushing it.

Speaker #5: And we expect that to continue. Then we've got the mixed topic. And as you know, there are two drivers behind that. One is diabetes.

And that is peripheral—vascular, peripheral vascular. So we've got a number of new products there. It's not just one thing. So I'd look at the business, you know, and the direction of travel of the overall business.

Speaker #5: To your point, if we are to separate diabetes before the end of the year, which is our intent, then we should see some lift in the gross margin rate coming from that.

Speaker #5: And then the other dimension of the mixed impact is coming from cash. It's actually getting better. Because the margin of cash is improving. And so we should see that being less of a headwind going into the second half.

Speaker #5: So look, all in all, what we've embedded in the guidance here as a gross margin that's basically flattish, slightly up excluding tariffs, or I would say very slightly up excluding tariffs, with a better performance in the second half than in the first half.

Geoff Martha: Where other companies see a mature market, our cardiac rhythm management sees opportunity and innovates and drives to a market. We're not worried about competition. It's about innovation and growing that market, lowering any kind of bar for pacing and CRM, and it's a wonderful story. The rest of the company is also doing well. There's puts and takes, it's also doing well. Peripheral vascular is part of that story of adding new products to the business. It all comes back to our capital allocation strategy of feeding the big markets and the hot hands, also making sure that there's the right amount of capital for the rest of the businesses, focusing the portfolio to enable that. Getting back to the diabetes question that Robbie had. I appreciate the question, Mike, I'm sure the peripheral vascular team does as well.

Speaker #5: And then the good news is growth is accelerating. And with growth, we're getting operating margin leverage with better absorption of the overhead. And this will come primarily from the SG&A line going into this year.

Putting more competitive products in that scaled sales force, uh, and it's, it's not. I, I appreciate the question, Mike. We don't get a lot of, uh, questions around peripheral vascular, but it's, you know, kind of sneakily, you know, kind of improving their growth profile, which is part of the exciting story of Medtronic. Because we you you've got these 3 groupings. You've got these big growth drivers that we are all talking about like cast and now you're going to hear more about art in and Hugo now. But both those guys had good, good, fourth quarters. And then you got all of Viva and and uh you know and stealth access these thoroughbreds coming out of the gate hot. And uh then you got our big businesses CST which we kind of just talked about surgery. Had a is doing well and cardiac rhythm is just crushing it like where other companies see a mature Market, our cardiac or the management sees opportunity and, and innovate and drives the market. And we're not worried about competition, it's about Innovation and growing that market lowering any kind of bar for for pacing.

Speaker #5: So yeah, we'll have accretion in operating margin, in particular in the second half of the year.

Speaker #8: Thank you. It's nice end of the year.

Speaker #6: All right. Our next question comes from Josh Jennings at TD Cowan. Please go ahead, Josh.

Speaker #7: Hi. Good morning. Thanks for taking the question. I was hoping to just get a beat on the China franchise, not the sexiest question here.

Speaker #7: But historically, China has been a growth channel. There have been some headwinds with VBP for a couple of business years. But what's the outlook for 2027?

Speaker #7: Maybe help us think about exposure there as a percentage of revenue? And is that is the China franchise going to be accretive or diluted to the organic revenue growth guidance?

In CRM, and it's just it's a wonderful story but then the rest of the company is also doing. Well, there's puts and takes but you know it's also doing well in peripheral. Vascular, is part of that story of adding new products to the, to the, to the, to the business. And it all comes back to our Capital, allocation strategy of feeding the the big markets and the hot hands. But also making sure that there's there's the right amount of uh, capital for the rest of the businesses and and hand focusing. The portfolio to enable that, that that's getting back to the diabetes question that Robbie had. So I appreciate the the question Mike, um, and I'm sure the peripheral vascular team does as well.

Understood. Thanks very much.

Mike Kratky: Understood. Thanks very much.

Ingrid Goldberg: Great. Thanks, everyone. With that, I think I'm going to turn the call back over to Geoff for some final remarks.

Speaker #7: Thanks for taking the question.

Geoff Martha: Okay. Well, first of all, thank you for joining the call and all the questions. It was a really important moment for the company as we are really accelerated and really well-positioned, putting up big numbers, and really well-positioned for the future, and particularly in a tougher market backdrop. I appreciate your support and your continued interest in Medtronic. With that, I'd say just have a great rest of your day, and thanks again.

Speaker #4: Look, thanks for the question, Josh. We haven't gotten a China question in a while. Look, China is we still view China as a growth market.

Speaker #4: So when we think about China, we think about it as a growth market as an end market. We don't have a whole lot of exposure in terms of manufacturing in China.

Speaker #4: For export outside of China. So we don't really have much exposure there. That's very small. It's really about how it continues to be a profitable growth market for the company.

Great. Thanks everyone. Um, so with that, I think I'm going to turn the call back over to Jeff for some final remarks. Okay. Well, first of all, thank you for, for joining the call and all the, all the questions. It was a really important moment for the company. Um, as we are really accelerated and really well, positioned, uh, putting up big numbers and really well positioned for the future, um, and, and particularly, in a, in a tougher M Market backdrop. So I appreciate your support uh, and your continued interest in Medtronic. And with that, I'd say just have a great rest of your day and thanks again.

Speaker #4: And look, we've had to navigate a number of these VBP and I think VBP is here to stay. But we have the worst is behind us.

Speaker #4: And we've the team's navigated it well. We've been able to increase the procedures and lower our costs because we're on these big contracts, these big tenders.

Speaker #4: And we've been able to pull out costs, increase volume, even though pricing's down. And it remains growing at the corporate average right now. And that average for the company is improving, as you see.

Speaker #4: And profitability is also strong. For years, there's been this misconception that China is not profitable. Prior to VBP, I admit it was even more profitable.

Speaker #4: But it's still accretive from a profitability standpoint. And it's a growth it's a growth region for the company. OK.

Speaker #6: All right. Next up, we have David Roman from Goldman Sachs. David, go ahead.

Speaker #7: Thank you, Ingrid. Good morning. I wanted just to come to the a comment you made on CAS during the prepared remarks. I think you talked about visualizing, excuse me, other catheters on Afera.

Speaker #7: And how you were thinking about integration of some of the investments you're making on expanding the accessory business within CAS, as well as the potential to integrate some of the other established technologies onto Afera.

Speaker #7: And then maybe let us ask my follow-up from here. I know Thierry, you talked about tariffs as you reflected it in the guidance. But there do seem to be a lot of other unresolved considerations on tariffs, such as USMCA, and then 232.

Speaker #7: So maybe just your latest updated thoughts there would be helpful.

Speaker #4: Well, first on cash, I mean, or on our Afera platform, we look at it as a three-in-one kind of we view it as the premier platform out there, right?

Speaker #4: And I think the numbers are bearing that out. And we've worked hard to get to this point. And we're still in the early innings of the launch of Afera.

Speaker #4: In the US, as Thierry pointed out, and globally. And there's a couple of vectors of growth. One is the innovation you pointed out. We're really surrounding electrophysiologists so we have more catheters coming out, PR360s in Europe.

Speaker #4: We started the trial in the US for single shot that goes right at our biggest competitor. The mapping we just launched our second generation mapping software.

Speaker #4: And as you pointed out, David, it's got this ability to sense other pick up other catheters. And then we're bringing in we just made two investments in ICE catheter companies.

Speaker #4: So we're going to build out our ecosystem and surround the EP in terms of it. Your question is about are we opening the system?

Speaker #4: I don't think we have plans for that right now. I mean, we're really building out our proprietary technology. And ensuring that we have that tight workflow.

Speaker #4: That is our plan to have that tight workflow. And get the best clinical outcomes in the the best experience for the physicians.

Speaker #3: Yeah. And on the tariff side, I think we mentioned it in the commentary. Look, we continue to monitor the environment there, which is still a little volatile, as you mentioned.

Speaker #3: I think we continue to look at the 232 situation. On the flip side, we've incorporated sort of a status quo in tariffs. So we haven't incorporated any potential upside from reimbursements that could occur.

Speaker #3: And which we have applied for. So we took a balanced approach on it, I would say.

Speaker #6: Thanks, David. Our next question comes from Robbie Marcus at JPMorgan.

Speaker #5: Great. Good morning. Thanks for taking the questions. Two quick ones for me. First, Jeff, I wanted to ask on Minimed. I see consensus numbers have strong organic sales growth margin and free cash flow improvements over the coming years.

Speaker #5: If that's the case, can you just remind us what's the rationale for separating it here? Wouldn't you want to keep a business with strong improvements and inflections in profitability and growth going forward?

Speaker #4: Look, I mean, we're separating it not because of our confidence in the outlook of the business. I mean, to your point, we think it's going to do really it's doing well today.

Speaker #4: And it's going to accelerate from here. With the product pipeline that they have, which I'm sure Q will give updates on the call after this.

Speaker #4: I mean, but it's the best we've seen. And it's comprehensive. Across all aspects of managing insulin-independent or insulin-dependent patients. So we feel really good about that.

Speaker #4: I think as we focus we have a lot of growth drivers to focus on. And these other growth drivers that we talked about today, whether it be CAS or RDN, Hugo, Altuviva, self-access, all of them I think take more advantage of and benefit from either technology platforms that cut across the company, especially in robotics and areas like that, or our commercial footprint.

Speaker #4: Where Minimed does not really capitalize on that as much. And the second is, look, we're very disciplined around capital allocation. And it's hard to constantly allocate capital to something, even though the growth is there.

Speaker #4: But the rest of Medtronic's growing much faster now. So the gap between Minimed and the rest of Medtronic isn't as much as it used to be in terms of growth.

Speaker #4: And profitability, though, it's just a structurally lower profitable segment. And so it's kind of hard to allocate capital that way. I think both businesses will do better separated.

Speaker #4: And we've for our own reputation and patients, we've we did not we think we're separating at the right time. We've put a lot of time and money into the business.

Speaker #4: It's ready to go. It's got a great management team. And it's going to do well for patients. It's going to do well for physicians.

Speaker #4: And it's going to do well for shareholders. And the rest of Medtronic, we're accelerating. And we're going to do well as well. So we're feeling really good about that decision.

Speaker #4: And excited about the future of both organizations.

Speaker #5: Fantastic. Maybe a quick one. Thierry, I look at consensus I realize you just got into fiscal '27. I look at consensus for 7% EPS growth for 2028, realizing there's one fewer selling week, which is $150-plus basis points to EPS this year.

Speaker #5: Should we be thinking about a similar headwind next year? And how do you want people to think about the year-to-year there, just so we could get it correct at this update?

Speaker #5: Appreciate the questions.

Speaker #3: Yeah. Thanks, Robbie. Hey, look, we'll give '28 guidance when we give '28 guidance. It's kind of early. But just kind of directionally, some of the headwinds that we've got, like tariffs, et cetera, disappear going into '28.

Speaker #3: And we expect the growth to continue, right? So we went through all the growth areas that we've got in the portfolio today. And a lot of these are in early innings, right?

Speaker #3: CAS is still going to continue to accelerate. RDN is very early in its development. Altuviva is also very early. And then we've got a long list of innovation that's kicking in in the rest of the portfolio.

Speaker #3: So yes, there will be pressure coming from the 53rd week going away. But we have a lot of things going the other way. So we look forward to talking about that later in the year.

Speaker #5: Great. Thank you for taking the questions.

Speaker #6: All right. And our last question. We have time for one more. It's going to come from Mike Cracke at Leering Partners. Thank you.

Speaker #2: Awesome. Can you hear me all right?

Speaker #5: Yep.

Speaker #3: Yeah.

Speaker #2: Great. So thanks for taking my questions. And congrats on the strong quarter. Maybe just one quick one. But in terms of your commercial strategy and mechanical thrombectomy, to what extent is Lieberman bringing differentiation to this market?

Speaker #2: How are you thinking about your ability to carve out share of the market with two well-intentioned competitors? And what could that opportunity look like?

Speaker #4: Yeah. Look, we're not we don't we try not to guide at a product level. So I can't get too specific there. But I do think we have a strong commercial footprint out there in our peripheral vascular business.

Speaker #4: And this is a product we've worked on for a while. And it's gotten we're getting great clinical results, physician feedback is good. And I think we're putting that product in the bag of our peripheral vascular business.

Speaker #4: Plus, it's got we got this agreement with Contigo, that's also helping that business. And help me, what else is?

Speaker #3: It's fine too. Oh, peripheral.

Speaker #4: Peripheral vascular. So we've got a number of new products there. It's not just one thing. So I'd look at the business and the direction of travel of the overall business, putting more competitive products in that scaled Salesforce.

Speaker #4: And it's not I appreciate the question, Mike. We don't get a lot of questions around peripheral vascular. But it's kind of sneakily kind of improving their growth profile, which is part of the exciting story of Medtronic.

Speaker #4: Because you've got these three groupings. You've got these big growth drivers that we were all talking about, like CAS. And now you're going to hear more about RDN and Hugo now.

Speaker #4: But both those guys had good fourth quarters. And then you've got Altuviva and self-access, these thoroughbreds coming out of the gate hot. And then you've got our big businesses, CST, which we kind of just talked about, surgery is doing well, and cardiac rhythm is just crushing it.

Speaker #4: Where other companies see a mature market, our cardiac rhythm management sees opportunity. And innovates and drives to a market. We're not worried about competition.

Speaker #4: It's about innovation and growing that market, lowering any kind of bar for pacing and CRM. And it's a wonderful story. But then the rest of the company is also doing well.

Speaker #4: There's puts and takes. But it's also doing well. And peripheral vascular is part of that story. Of adding new products to the business. And it all comes back to our capital allocation strategy, of feeding the big markets and the hot hands, but also making sure that there's the right amount of capital for the rest of the businesses.

Speaker #4: And hence, focusing the portfolio to enable that. It's getting back to the diabetes question that Robbie had. So I appreciate the question, Mike. And I'm sure the peripheral vascular team does as well.

Speaker #2: Understood. Thanks very much.

Speaker #6: Great. Thanks, everyone. So with that, I think I'm going to turn the call back over to Jeff for some final remarks.

Speaker #4: OK. Well, first of all, thank you for joining the call and all the questions. It was a really important moment for the company. As we are really accelerated and really well-positioned putting up big numbers and really well-positioned for the future.

Speaker #4: And particularly in a tougher market backdrop. So I appreciate your support and your continued interest in Medtronic. And with that, I'd say just have a great rest of your day.

Q4 2026 Medtronic PLC Earnings Call

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