Financial Data and Key Metrics Changes - Sales for Q3 2025 totaled $468 million, reflecting an 8% growth on a reported basis and 7% growth organically [13][9] - Adjusted operating income increased by 14% year over year, with adjusted EPS growing 25% to $1.79 [15][9] - Year-to-date sales are up 9%, adjusted operating income is up 14%, and adjusted EPS is up 20% [30] Business Line Data and Key Metrics Changes - Cardio and vascular sales increased by 15% in Q3 2025, driven by new product ramps in electrophysiology and strong demand in neurovascular [15] - Cardiac rhythm management solutions sales increased by 2% year over year, with expectations for mid-teens growth for the full year 2025 [16][17] - Neuromodulation sales growth was impacted by lower demand from select emerging customers, with expectations for low single-digit growth for the full year 2025 [17] Market Data and Key Metrics Changes - The market adoption of new electrophysiology products has been slower than anticipated, leading to a forecast reduction for 2026 [11][12] - The company expects a 3% to 4% headwind to total sales in 2026 due to the decline in three new products [11][12] - The overall market in which the company competes is growing at a steady mid-single digit rate [29] Company Strategy and Development Direction - The company remains confident in its long-term growth strategy, focusing on early design wins in high-growth markets [12][29] - A strong product development pipeline is expected to drive above-market growth in 2027 [28][29] - The company plans to continue its acquisition strategy while maintaining a leverage ratio within the targeted range of 2.5 to 3.5 times [29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a reduction in the financial outlook due to unexpected changes in customer forecasts for new products [5][9] - Despite the challenges, management expressed confidence in the company's strategy and operational execution [6][12] - The company anticipates a recovery to market growth in the second half of 2026 as new product headwinds moderate [11][12] Other Important Information - The adjusted effective tax rate for Q3 2025 was 16.3%, down from 17.2% in the prior year, with expectations for the full year to be between 17% and 18% [18] - Free cash flow for Q3 was $46 million, flat compared to the prior year, with net total debt decreasing to $1,158 million [19][24] Q&A Session Summary Question: Can you elaborate on the organic growth of the rest of the portfolio? - Management indicated that without new product introductions, the rest of the portfolio is expected to grow at market rates, which is lower than the typical 6% to 8% growth [32][33] Question: What are the expected headwinds in the cardio and vascular items? - The headwinds are related to two electrophysiology products with slower market adoption than anticipated, not due to loss of market share [34][36] Question: How confident is the company in returning to market growth by Q4 2026? - Management expressed confidence due to steady backlog and customer forecasts, despite the unusual simultaneous changes in multiple products [38][39] Question: What changes will be made to the forecasting process? - The company is reflecting on its forecasting processes but maintains that its algorithm for risk-adjusting forecasts remains unchanged [90][92]