10-QPeriod: Q3 FY2024

Medtronic plc Quarterly Report for Q3 Ended Jan 26, 2024

Filed February 27, 2024For Securities:MDT

Summary

Medtronic plc reported robust financial performance for the nine months ended January 26, 2024, with net sales increasing by 5% to $23.78 billion and net income attributable to Medtronic rising by 17% to $3.02 billion. This growth was driven by strong performance across its key segments, including Cardiovascular, Neuroscience, Medical Surgical, and Diabetes. The company also demonstrated healthy operational cash flow, generating $4.01 billion for the nine-month period, a significant increase from the prior year. Looking ahead, Medtronic continues to focus on innovation and strategic growth initiatives, including new product launches and expanding its market presence globally. The company remains committed to returning value to shareholders through share repurchases and dividends, while maintaining a strong financial position to fund future investments and navigate market dynamics.

Financial Highlights

55 data points
Beta

Revenue

$8.09B

65.6% Gross Margin

Net Income

$1.34B

16.5% Net Margin

EPS (Diluted)

$0.99

Total Assets

$90.84B

Cash & Equivalents

$1.62B

Free Cash Flow

$2.13B

Financial Statements
Beta
Revenue$8.09B
Cost of Revenue$2.78B
Gross Profit$5.31B
SG&A Expenses$2.67B
Operating Income$1.48B
Interest Expense$188.00M
Net Income$1.34B
EPS (Basic)$0.99
EPS (Diluted)$0.99
Shares Outstanding (Basic)1.33B
Shares Outstanding (Diluted)1.33B

Key Highlights

  • 1Net sales increased by 5% to $23.78 billion for the nine months ended January 26, 2024, compared to $22.68 billion in the prior year.
  • 2Net income attributable to Medtronic grew by 17% to $3.02 billion for the nine months ended January 26, 2024, compared to $2.58 billion in the prior year.
  • 3Diluted earnings per share increased to $2.27 for the nine months ended January 26, 2024, up from $1.94 in the prior year.
  • 4Operating cash flow improved significantly, reaching $4.01 billion for the nine months ended January 26, 2024, up from $3.58 billion in the prior year.
  • 5The Cardiovascular segment showed strong growth with net sales up 6% to $8.70 billion for the nine months, driven by Micra, TAVR, and Perfusion.
  • 6The Diabetes segment experienced robust growth, with net sales up 10% to $1.83 billion for the nine months, driven by international expansion of the MiniMed 780G insulin pump system.
  • 7Medtronic announced a subsequent event to exit its ventilator product line, expecting to record a pre-tax charge of $350 million to $425 million.

Frequently Asked Questions

For the nine months ended January 26, 2024, Medtronic reported net sales of $23.78 billion, representing a 5% increase compared to $22.68 billion for the same period in the prior year. For the three months ended January 26, 2024, net sales were $8.09 billion, up 5% from $7.73 billion in the prior year's comparable period.

Net income attributable to Medtronic for the nine months ended January 26, 2024, increased by 17% to $3.02 billion, up from $2.58 billion in the prior year. Diluted earnings per share rose to $2.27 from $1.94. For the three-month period, net income attributable to Medtronic was $1.32 billion, an increase of 8% from $1.22 billion in the prior year, with diluted EPS at $0.99.

Medtronic demonstrated strong operating cash flow, generating $4.01 billion for the nine months ended January 26, 2024, an increase from $3.58 billion in the prior year. Free cash flow for the nine-month period was $2.85 billion, up from $2.50 billion in the prior year.

Yes, Medtronic announced a subsequent event decision to exit its ventilator product line. The company expects to record an estimated pre-tax charge of $350 million to $425 million, primarily related to non-cash impairment of long-lived intangible assets, with the majority expected in the quarter ending April 26, 2024. They will continue to honor existing ventilator contracts.