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] Business Line Data and Key Metrics Changes - Cardiovascular grew 7% this quarter, driven by nearly 50% growth in Cardiac Ablation Solutions [21][22] - Neuroscience grew 3%, with high single-digit growth in neurosurgery and neuromodulation [11][28] - MedSurg grew 2%, with high single-digit growth in Advanced Energy [31] - Diabetes grew 8%, with 11% growth 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 [60] - The company expects to ramp up procedures for the SIMPLICITY system following CMS's proposed national coverage decision [25][27] Company Strategy and Development Direction - The company is focused on accelerating growth through innovation and strategic investments in high-growth areas like CAS and Ardian [19][20] - A planned separation of the diabetes business is expected to enhance focus on core businesses and improve revenue and earnings growth [19][37] - New board committees have been established to enhance focus on growth and operational efficiency [48][49] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in accelerating growth in the second half of fiscal 2026, driven by strong demand and new product launches [7][19] - The company anticipates significant revenue growth from its PFA portfolio and other upcoming product launches [13][14] - Management highlighted the importance of maintaining pricing discipline and improving operational efficiencies to support growth [38][45] Other Important Information - The company is increasing investments in R&D, with a 7.7% increase in adjusted R&D spending [40] - The anticipated impact of tariffs has been adjusted, with expectations now at approximately €185 million for fiscal 2026 [44] Q&A Session All Questions and Answers Question: Update on CAS growth and its impact on U.S. growth - Management confirmed that CAS growth is accelerating and will positively impact U.S. growth, despite some segments showing slower growth [56][58] Question: Impact of new board committees on governance and operations - The new committees will provide focused oversight on growth and operational performance, with increased interaction with management expected to drive improvements [68][70] Question: Commitment to CAS annual sales target - Management reaffirmed the commitment to achieving $2 billion in annual CAS sales, indicating strong confidence in the growth trajectory [76][78] Question: Discussion on capital allocation and potential changes - Management indicated that the new board members and committees will facilitate discussions on capital allocation and value creation strategies [81][89] Question: Overall portfolio growth expectations - Management stated that while significant growth opportunities exist, they will not neglect the rest of the business and expect to see incremental growth from various segments [99][100]

Summary of Huatai Medical Conference Call Company and Industry Overview - **Company**: Huatai Medical - **Industry**: Electrophysiology and Medical Devices Key Points and Arguments 1. **PFA Product Approval**: Huatai Medical's PFA product is expected to be approved for market launch by the end of 2024, offering differentiated advantages in general anesthesia, pressure sensing, and 3D mapping, which align closely with domestic clinical practices, potentially allowing for a competitive edge over foreign manufacturers [2][3][4] 2. **PFA Technology Advantages**: PFA technology induces myocardial cell death through high-voltage electrical pulses, providing high tissue selectivity, good safety, and reduced reliance on thermal energy, which shortens surgery time and lowers the experience requirement for operators [2][4][10] 3. **Market Growth**: The global electrophysiology market was approximately $8 billion in 2023, with a projected compound annual growth rate (CAGR) of 13% from 2024 to 2026. The atrial fibrillation market is expected to grow rapidly, with PFA technology's market share anticipated to rise from less than 5% currently to 40%-60% by 2026, and potentially 60%-80% by 2028 [2][10] 4. **Domestic Patient Statistics**: In 2022, there were 8.32 million hospitalized patients with arrhythmias in China, with a continuous increase in catheter ablation procedures. The long-term potential for PFA procedures in China is estimated to reach between 800,000 and 1.02 million cases, translating to a market size exceeding 10 billion RMB [2][11][12] 5. **Competitive Landscape**: Domestic companies like Huatai Medical, Jinjiang Electronics, and Denovo have received NMPA approval for their PFA systems, showcasing differentiated advantages that align with local clinical habits, which may lead to significant changes in the domestic electrophysiology landscape [2][6][14] 6. **Sales and Marketing Strategy**: Huatai Medical has a sales team of over 200, with a focus on PFA products. The company aims to establish a minimum of 3,000 terminal orders for the year, indicating strong promotional efforts and positive reception from doctors regarding their 3D mapping technology and product combinations [4][18] 7. **Other Business Segments**: Besides electrophysiology, Huatai Medical has strong performance in other segments, including coronary intervention with over 15% market share, peripheral intervention at about 5%, and urological stone products at around 20% [19] 8. **Future Development Directions**: The company plans to focus on expanding its product coverage in vascular access and stent markets, while also developing non-vascular intervention products, indicating a strategy for diversified growth [20] Additional Important Information - **Clinical Value of PFA**: PFA technology offers significant clinical value compared to traditional RF ablation, with faster ablation times and reduced overall procedure durations, making it more appealing to domestic physicians [17] - **Market Penetration**: The penetration of PFA technology in the Chinese market is expected to mirror that of Japan, with substantial growth potential in the coming years [12][14] - **Product Design Differences**: Domestic manufacturers have advantages in mapping, modeling, and compatibility design, with Huatai Medical's products being the only ones featuring a 3D mapping platform, which aligns with traditional RF ablation practices [15][16]