Financial Data and Key Metrics Changes - The company reported Q1 revenue of €8.6 billion, growing 8.4% reported and 4.8% organic, in line with guidance [38] - Adjusted EPS was €1.26, exceeding the midpoint of guidance by €0.03 [42] - Adjusted gross margin was 65.1%, down 80 basis points year over year, but stable compared to Q4 [38][39] Business Line Data and Key Metrics Changes - Cardiovascular grew 7% this quarter, with cardiac ablation solutions achieving nearly 50% growth [20][21] - Neuroscience grew 3%, with high single-digit growth in neurosurgery and neuromodulation [10][27] - MedSurg grew 2%, with advanced energy showing high single-digit growth [31] - Diabetes grew 8%, driven by the strength of the 780G system and Simplera Sync Sensor in international markets [34] Market Data and Key Metrics Changes - The U.S. market showed slower growth in certain segments, particularly in diabetes and pelvic health, while international markets performed better [61] - CAS growth was particularly strong in the U.S. and Japan, with low 70s growth in the U.S. and low 30s growth internationally [20][21] Company Strategy and Development Direction - The company is focused on accelerating growth through innovation in med tech and has raised its EPS guidance for the full year [6][7] - A planned separation of the diabetes business is expected to sharpen focus on core high-growth opportunities [17][37] - New board committees have been established to enhance focus on growth and operational efficiency [49][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to accelerate growth throughout fiscal 2026, citing strong demand and a robust product pipeline [6][17] - The company anticipates significant growth from the cardiac ablation solutions and renal denervation segments [12][13] - Management highlighted the importance of operational efficiency and innovation to drive long-term shareholder value [18][46] Other Important Information - The company expects to finalize the national coverage determination for the simplicity procedure for hypertension by October 8 [25] - The company is investing significantly in R&D, with a 7.7% increase in adjusted R&D spending [40] Q&A Session Summary Question: Update on CAS growth and its impact on U.S. growth - Management confirmed confidence in CAS growth, noting strong demand and utilization, and expects it to positively impact U.S. growth in the future [56][60] Question: Impact of new board committees on governance and capital allocation - Management explained that the new committees will provide focused oversight on growth and operational performance, enhancing communication with management [70][72] Question: Commitment to CAS annual sales target - Management reiterated commitment to the $2 billion annual sales target for CAS, indicating strong momentum and confidence in achieving this goal [76][78] Question: Discussion on capital allocation and EPS growth - Management emphasized a renewed focus on value creation, including potential M&A opportunities and increased investment in growth drivers [81][86] Question: Overall portfolio growth expectations - Management indicated that while significant growth drivers are emerging, the overall business will continue to improve, with a focus on maintaining operational efficiency and EPS growth [95][100]

Financial Data and Key Metrics Changes - The company reported Q4 revenue of $8.9 billion, growing 5.4% organically, with adjusted EPS of $1.62, up 11% [46][49] - For the full fiscal year 2025, revenue grew 5% organically and EPS grew 6% or 10% on a constant currency basis [50][56] - Adjusted gross margin was 65.1%, down 70 basis points year over year, while adjusted operating margin increased to 27.8%, up 90 basis points [47][49] Business Line Data and Key Metrics Changes - The cardiovascular portfolio grew 8%, with nearly 30% growth in cardiac ablation solutions [6][9] - Neuromodulation and diabetes segments delivered double-digit growth, while cranial and spinal technologies saw high single-digit growth in the US [7][25] - The diabetes business grew 12%, marking the sixth consecutive quarter of double-digit growth [25][26] Market Data and Key Metrics Changes - The US market experienced its strongest quarterly growth in 15 quarters, growing 5% [46] - Japan grew high single digits, while Western Europe and emerging markets grew mid single digits [46] - The company noted strong growth in India, Southeast Asia, and Eastern Europe [46] Company Strategy and Development Direction - The company plans to separate its diabetes business into a standalone public company, which is expected to enhance focus on high-margin growth markets [28][29] - The separation is seen as a strategic move to improve capital allocation and increase growth accretive investments in core businesses [44][45] - The company aims to continue delivering mid single-digit organic revenue growth and accelerating earnings leverage [30][61] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth drivers, highlighting strong positions in key markets and the potential for continued growth [88][90] - The company anticipates a return to high single-digit EPS growth in fiscal year 2027, driven by strong revenue growth and benefits from the diabetes separation [55][101] - Management emphasized the importance of operational improvements and cost management to enhance profitability [92][95] Other Important Information - The company announced an increase in its dividend for the 48th consecutive year [50] - The new CFO, Thierry Piéton, emphasized the focus on enhancing operations and driving value creation [39][42] - The company is investing significantly in R&D for the first time in four years, planning to grow R&D faster than revenue [53][92] Q&A Session Questions and Answers Question: Guidance philosophy with the new CFO - The company is bullish on growth drivers, with markets growing 7% even without diabetes, and expects strong contributions from key portfolios [88][90] Question: EPS growth expectations and below-the-line items - The company anticipates operating profit growth around 7%, despite pressures from tax and interest expenses [92][93] Question: Impact of tariffs and diabetes business separation - The impact of tariffs is expected to be between $200 million to $350 million, while the diabetes business separation is projected to be immediately accretive to EPS [106][101]