Core Insights - Medtronic plc is expanding its global presence in the Cardiovascular business, which is expected to support growth in upcoming quarters [1] - The company is gaining market share in Neuroscience, particularly in Cranial and Spinal technologies, aided by strong growth and competitor exits [1] - International expansion remains robust, contributing significantly to revenue growth [1] Cardiovascular Business - Medtronic's cardiac rhythm management segment continues to lead the market, driven by strong performance in Defibrillation Solutions and cardiac pacing therapies [3] - The fiscal third quarter of 2025 saw the cardiovascular portfolio grow in the mid-single digits, with the Cardiac Ablation Solutions business achieving 22% growth [4] - The next-generation Micra AV2 and VR2 leadless pacemakers are key drivers of growth as they penetrate new and existing markets [3] Neuroscience Portfolio - The Neuroscience portfolio, particularly Cranial and Spinal technologies, is experiencing strong growth, with Medtronic gaining market share as competitors exit the market [5] - In Neuromodulation, the Inceptiv spinal cord stimulator drove 12% growth in the fiscal third quarter, while brain modulation saw 15% global growth and 26% growth in the U.S. [6] International Expansion - Nearly 49% of Medtronic's revenues were generated internationally in the third quarter of fiscal 2025, with emerging markets growing in high-single digits [7] - Significant growth was noted in India (high-teens), Eastern Europe (mid-teens), and low-double-digit growth in Southeast Asia, the Middle East, and Africa [9] Financial Performance - Medtronic has a market capitalization of $108.05 billion and an earnings yield of 6.92%, significantly higher than the industry's yield of 0.05% [2] - The Zacks Consensus Estimate for fiscal 2025 earnings per share (EPS) is $5.46, with revenues estimated at $33.48 billion, reflecting a 3.4% increase from the previous year [12]

Core Viewpoint - Medtronic is facing challenges in the fiscal fourth quarter of 2025 due to rising costs, geopolitical pressures, and declining earnings estimates despite previous earnings beats [3][4][6]. Financial Performance - Medtronic's adjusted earnings for the last reported quarter were $1.39, exceeding the Zacks Consensus Estimate by 2.21% [1] - The Zacks Consensus Estimate for fiscal fourth-quarter revenues is $8.81 billion, indicating a year-over-year growth of 2.6% [2] - The consensus estimate for fourth-quarter earnings is $1.58 per share, reflecting an 8.2% rise year-over-year [2] - Earnings estimates for the fourth quarter have declined by 1.9% over the past 90 days [2] Challenges and Headwinds - Rising costs and expenses due to inflation and geopolitical pressures are impacting profitability [3] - The tariff environment is affecting financial outlook, particularly due to Medtronic's manufacturing presence in Mexico and Canada [4] - Lower procedural volumes in elective surgeries and other medical procedures are putting pressure on the bottom line [6] - Unfavorable currency movements are expected to negatively impact revenues by $125 million to $175 million in the fourth quarter [8] Growth Opportunities - Despite challenges, Medtronic has shown resilience with mid-single-digit organic revenue growth [9] - Key growth areas include pulse field ablation, TAVR, neuromodulation, and diabetes businesses, driven by new product launches [10][12][13] - The company has made foundational changes to improve operations and is focusing on fast-growth MedTech markets [15][16] Market Position - Medtronic's stock has declined 5.9% in the fiscal fourth quarter, underperforming compared to industry peers [20] - The company's shares trade at a Price/Earnings ratio of 14.24X, below the industry average of 21.71X and the S&P 500's 20.43X [24][25] Conclusion - Medtronic has significant long-term growth potential but faces macroeconomic headwinds and rising expenses that could impact bottom-line growth [26]