Medtronic(US:MDT)2025-11-25 21:18Financial Performance - Net income for the three months ended October 24, 2025, was $1,381 million, an increase of 8.1% compared to $1,278 million for the same period in 2024[12] - Comprehensive income attributable to Medtronic for the six months ended October 24, 2025, was $2,423 million, up from $2,381 million in the prior year, reflecting a growth of 1.8%[12] - For the three months ended October 24, 2025, total net sales were $8,961 million, an increase of 6.6% compared to $8,403 million for the same period in 2024[29] - Total net sales for the six months ended October 24, 2025, reached $17,539 million, up 7.5% from $16,318 million in the prior year[29] - Segment operating profit for the three months ended October 24, 2025, was $2,201 million, compared to $2,065 million for the same period last year, reflecting an increase of 6.6%[119][120] - The reportable segment operating profit for the six months ended October 24, 2025, was $4,253 million, compared to $4,015 million for the same period last year, marking an increase of 5.9%[123][124] Assets and Liabilities - Total current assets as of October 24, 2025, were $23,996 million, slightly up from $23,814 million as of April 25, 2025[14] - Total liabilities decreased to $42,489 million from $43,424 million, a reduction of 2.2%[14] - Total assets as of October 24, 2025, were $91,346 million, slightly down from $91,680 million as of April 25, 2025[127] - The company’s retained earnings increased to $32,070 million as of October 24, 2025, from $31,476 million as of April 25, 2025[14] - The total shareholders' equity as of October 24, 2025, was $48,652 million, up from $48,024 million as of April 25, 2025[14] Cash Flow and Operating Activities - Net cash provided by operating activities for the six months ended October 24, 2025, was $2,013 million, compared to $1,944 million for the same period in 2024, representing a growth of 3.5%[17] - Cash and cash equivalents decreased to $1,282 million from $2,218 million, indicating a reduction of 42.2%[14] - The company experienced a net cash provided by operating activities of $2,013 million for the six months ended October 24, 2025, compared to $1,944 million for the same period in 2024[17] Debt and Financing - Long-term debt increased to $27,680 million from $25,642 million, reflecting an increase of 7.9%[14] - The Company has $1.4 billion of commercial paper outstanding as of October 24, 2025, with a weighted average interest rate of 4.36%[49] - The Company maintains a $3.5 billion unsecured revolving credit facility, with no amounts outstanding as of October 24, 2025[50] - Total long-term debt amounts to $27.68 billion as of October 24, 2025, compared to $25.64 billion as of April 25, 2025[53] Revenue Segments - The Cardiovascular segment reported net sales of $3,436 million for the three months ended October 24, 2025, up 10.8% from $3,102 million in the prior year[29] - Neuroscience segment net sales reached $2,562 million for the three months ended October 24, 2025, compared to $2,451 million for the same period in 2024, reflecting a growth of 4.5%[29] - The Diabetes segment generated $757 million in net sales for the three months ended October 24, 2025, a 10.3% increase from $686 million in the same period last year[29] - Cardiac Rhythm & Heart Failure segment reported sales of $3,538 million for the six months ended October 24, 2025, a 13.6% increase from $3,114 million in the same period last year[29] Expenses - Selling, general, and administrative expenses for the three months ended October 24, 2025, were $2,923 million, compared to $2,729 million for the same period last year, representing an increase of 7.1%[119][120] - Research and development expenses for the three months ended October 24, 2025, totaled $754 million, up from $693 million in the same period last year, indicating an increase of 8.8%[119][120] - The cost of products sold for the three months ended October 24, 2025, was $3,053 million, compared to $2,896 million for the same period last year, reflecting an increase of 5.4%[119][120] Taxation - The effective tax rate for the three months ended October 24, 2025, was 13.5%, down from 18.0% for the same period in 2024, primarily due to a tax benefit recognized related to uncertain tax positions[83] - The gross unrecognized tax benefits remained at $2.9 billion as of October 24, 2025, with a potential impact of approximately $2.7 billion on the effective tax rate if recognized[84] Stock-Based Compensation - The company reported a stock-based compensation expense of $268 million for the six months ended October 24, 2025, compared to $242 million in the same period last year, an increase of 10.7%[17] - Total stock-based compensation expense for the three months ended October 24, 2025, was $182 million, compared to $159 million for the same period in 2024, reflecting an increase of 14.5%[88] Investments and Acquisitions - The acquisition date fair value of net assets acquired during fiscal year 2025 was $128 million, including $159 million of assets and $31 million of liabilities[35] - The Company completed the sale of half of its Renal Care Solutions business to DaVita, retaining a 50% non-controlling equity interest in Mozarc valued at $307 million[46] - The Company recognized a loss of $90 million on the Mozarc investment during the six months ended October 24, 2025, primarily due to historical financial results and future cash flow projections[47] Litigation and Compliance - The Company is involved in lawsuits filed on behalf of approximately 10,000 individual plaintiffs related to hernia mesh products, with 7,400 cases pending in Massachusetts state court[97] - The Company has ongoing interactions with governmental agencies regarding anti-corruption compliance, with potential fines and penalties if non-compliance is determined[103] Other Comprehensive Income - The accumulated other comprehensive loss (AOCI) as of October 24, 2025, was $4.275 billion, slightly improved from $4.284 billion as of April 25, 2025[90] - The Company recognized $40 million in after-tax unrealized gains related to net investment hedges during the three months ended October 24, 2025[64]