Medtronic Reports Q3 FY2026 Results Amid Tariff Challenges
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy MDT?
Source: seekingalpha
- Financial Performance: Medtronic reported a non-GAAP EPS of $1.36 for Q3 FY2026, beating consensus by $0.02, with revenue of $9 billion reflecting approximately 9% YoY growth, showcasing the company's resilience amid challenges.
- Revenue Outlook: The company reaffirmed its FY2026 outlook, projecting about 5.5% organic revenue growth despite facing a $185 million headwind from tariffs, and estimates a 4.5% growth in diluted non-GAAP EPS excluding tariff impacts, outperforming analysts' 2.9% expectations.
- Business Drivers: The cardiovascular segment drove significant growth, contributing $3.5 billion in revenue with a 14% YoY increase, while the diabetes unit also supported growth with $796 million in revenue, benefiting from double-digit growth in international markets.
- Profit Pressure: Despite revenue growth, Medtronic's adjusted net income fell approximately 2% YoY to $1.8 billion, with non-GAAP operating margin decreasing from 26.2% to 24.1%, indicating cost pressures and market challenges.
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Analyst Views on MDT
Wall Street analysts forecast MDT stock price to rise
20 Analyst Rating
11 Buy
9 Hold
0 Sell
Moderate Buy
Current: 96.410
Low
102.00
Averages
111.76
High
120.00
Current: 96.410
Low
102.00
Averages
111.76
High
120.00
About MDT
Medtronic Public Limited Company is an Ireland-based company, which provides healthcare technology solutions. The Company’s products category includes Advanced Surgical Technology; Cardiac Rhythm; Cardiovascular; Digestive & Gastrointestinal; Ear, Nose & Throat; General Surgery; Gynecological; Neurological; Oral & Maxillofacial; Patient Monitoring; Renal Care; Respiratory; Spinal & Orthopedic; Surgical Navigation & Imaging; Urological; Product Manuals; Product Ordering & Inquiries; and Product Performance & Advisories. Its products include Cardiac Implantable Electronic Device (CIED) Stabilization, Aortic Stent Graft Products, CareLink Personal Therapy Management Software, CareLink Pro Therapy Management Software. Its services and solutions include Ambulatory Surgery Center Resources, Care Management Services, Digital Connectivity Information Technology (IT) Support, Equipment Services and Support, Innovation Lab, Medtronic Healthcare Consulting, and Office-Based Sinus Surgery.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Medtronic Reports Strong Q3 Earnings, Beats Estimates
- Earnings Beat: Medtronic reported an adjusted EPS of $1.36 for Q3, surpassing market expectations of $1.33, indicating strong performance in the medical device sector and boosting investor confidence.
- Sales Growth: The company achieved quarterly sales of $9.017 billion, exceeding the anticipated $8.905 billion, demonstrating sustained demand for its products and enhancing market share and profitability.
- Guidance Affirmation: Medtronic reaffirmed its FY2026 adjusted EPS guidance of $5.62 to $5.66, aligning with market estimates of $5.65, showcasing the company's confidence in future performance.
- Analyst Rating Changes: Needham analyst maintained a Buy rating on Medtronic but lowered the price target from $121 to $120, while Baird analyst kept a Neutral rating and reduced the target from $103 to $100, reflecting cautious sentiment regarding the company's outlook.
See More
U.S. Stocks Slightly Up as Fear Index Eases
- Fear Index Update: The CNN Money Fear & Greed Index registered at 37.3 on Tuesday, slightly up from 36.1, indicating a minor easing in market sentiment while still remaining in the 'Fear' zone, suggesting cautious investor behavior.
- Market Performance: On Tuesday, U.S. stocks saw slight gains, with the S&P 500 rising approximately 0.1% to close at 6,843.22, despite all major indices experiencing losses last week, including a 1.4% drop in the S&P 500.
- Sector Performance Divergence: Most sectors within the S&P 500 closed negatively, with consumer staples, energy, and materials stocks suffering the largest losses, while real estate and financial stocks bucked the trend, indicating a divergence in sector performance amid overall market uncertainty.
- Manufacturing Index Decline: The NY Empire State Manufacturing Index fell to 7.1 in February, down from 7.7 the previous month and below market expectations of 7, reflecting a slowdown in economic activity that could negatively impact future market sentiment.
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U.S. Stocks Close Mixed, Apple Shares Rise on Product Launch News
- Market Performance Fluctuates: On Tuesday, the S&P 500 rose by 0.10%, the Dow Jones increased by 0.07%, while the Nasdaq 100 fell by 0.13%, indicating a mixed market recovery from early losses, with the Nasdaq 100 hitting a 2.75-month low, reflecting investor caution towards tech stocks.
- Apple Product Launch Boost: Apple shares surged over 3% after announcing a product launch on March 4, with several new devices expected in the coming weeks, which not only boosted Apple's market performance but also generated positive sentiment across the tech sector.
- Airline Stocks Rally: Airline stocks showed strong performance on Tuesday, led by a 6% increase in Southwest Airlines after UBS upgraded its rating from neutral to buy with a price target of $73, which not only enhanced the overall performance of airline stocks but also contributed to a more optimistic market outlook.
- Mixed Economic Data: The U.S. February NAHB housing market index unexpectedly fell to a 5-month low of 36, below the expected 38, while the February Empire manufacturing survey slightly declined to 7.1, indicating uncertainty in economic recovery, as the market remains focused on upcoming corporate earnings and economic news.
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Medtronic Reports Decline in Q3 Profit
- Profit Decline: Medtronic's Q3 net profit fell to $1.143 billion, or $0.89 per share, down from $1.294 billion and $1.01 per share last year, indicating significant pressure on the company's profitability.
- Adjusted Earnings: Excluding items, Medtronic reported adjusted earnings of $1.750 billion, or $1.36 per share, showing some resilience in profitability despite the overall decline in net income.
- Revenue Growth: The company experienced an 8.7% year-over-year revenue increase, reaching $9.017 billion compared to $8.292 billion last year, indicating strong market demand.
- Future Guidance: Medtronic's full-year EPS guidance is set between $5.62 and $5.66, reflecting management's optimism about future earnings despite the current profit decline, suggesting confidence in business prospects.
See More
Medtronic's "Textbook" Turnaround: What is Its Potential in 2026?
Stock Performance: Medtronic's stock has shown a reversal pattern, indicating a critical pivot point, with analysts predicting potential price increases driven by improving growth outlook and market sentiment.
Investment Trends: Institutions hold over 80% of Medtronic's stock, with a bullish bias in buying activity expected to ramp up towards the end of 2025 and early 2026, aligning with stock price actions.
Financial Outlook: Medtronic reported solid quarterly results with revenues surpassing estimates, and analysts expect continued revenue growth and adjusted earnings per share (EPS) to exceed forecasts, despite some pressures from tariffs.
Long-Term Growth Potential: The company is focusing on long-term growth targets, with new products and expanding approvals expected to drive business, while maintaining a strong cash flow to support capital returns and dividend distributions.
See More
Medtronic Q3 Earnings Exceed Expectations
- Earnings Beat: Medtronic reported adjusted earnings of $1.36 per share for Q3, surpassing expectations of $1.33, indicating robust profitability amid challenging economic conditions.
- Neuroscience Growth: The Neuroscience portfolio generated $2.558 billion in revenue, a 4.1% increase, with mid-single-digit growth in Neuromodulation and Cranial & Spinal Technologies, reflecting strong market demand in this segment.
- Diabetes Business Surge: Revenue from the diabetes segment reached $796 million, up 14.8%, showcasing the company's innovation and acceptance in diabetes management products, further solidifying its market position.
- Positive Outlook: Medtronic reiterated its fiscal 2026 organic revenue growth forecast of approximately 5.5% and adjusted EPS guidance of $5.62 to $5.66, despite a potential $185 million tariff impact, demonstrating confidence in future growth prospects.
See More
Medtronic Reports Strong Q3 Earnings, Beats Estimates
- Earnings Beat: Medtronic reported an adjusted EPS of $1.36 for Q3, surpassing market expectations of $1.33, indicating strong performance in the medical device sector and boosting investor confidence.
- Sales Growth: The company achieved quarterly sales of $9.017 billion, exceeding the anticipated $8.905 billion, demonstrating sustained demand for its products and enhancing market share and profitability.
- Guidance Affirmation: Medtronic reaffirmed its FY2026 adjusted EPS guidance of $5.62 to $5.66, aligning with market estimates of $5.65, showcasing the company's confidence in future performance.
- Analyst Rating Changes: Needham analyst maintained a Buy rating on Medtronic but lowered the price target from $121 to $120, while Baird analyst kept a Neutral rating and reduced the target from $103 to $100, reflecting cautious sentiment regarding the company's outlook.
See More
U.S. Stocks Slightly Up as Fear Index Eases
- Fear Index Update: The CNN Money Fear & Greed Index registered at 37.3 on Tuesday, slightly up from 36.1, indicating a minor easing in market sentiment while still remaining in the 'Fear' zone, suggesting cautious investor behavior.
- Market Performance: On Tuesday, U.S. stocks saw slight gains, with the S&P 500 rising approximately 0.1% to close at 6,843.22, despite all major indices experiencing losses last week, including a 1.4% drop in the S&P 500.
- Sector Performance Divergence: Most sectors within the S&P 500 closed negatively, with consumer staples, energy, and materials stocks suffering the largest losses, while real estate and financial stocks bucked the trend, indicating a divergence in sector performance amid overall market uncertainty.
- Manufacturing Index Decline: The NY Empire State Manufacturing Index fell to 7.1 in February, down from 7.7 the previous month and below market expectations of 7, reflecting a slowdown in economic activity that could negatively impact future market sentiment.
See More
U.S. Stocks Close Mixed, Apple Shares Rise on Product Launch News
- Market Performance Fluctuates: On Tuesday, the S&P 500 rose by 0.10%, the Dow Jones increased by 0.07%, while the Nasdaq 100 fell by 0.13%, indicating a mixed market recovery from early losses, with the Nasdaq 100 hitting a 2.75-month low, reflecting investor caution towards tech stocks.
- Apple Product Launch Boost: Apple shares surged over 3% after announcing a product launch on March 4, with several new devices expected in the coming weeks, which not only boosted Apple's market performance but also generated positive sentiment across the tech sector.
- Airline Stocks Rally: Airline stocks showed strong performance on Tuesday, led by a 6% increase in Southwest Airlines after UBS upgraded its rating from neutral to buy with a price target of $73, which not only enhanced the overall performance of airline stocks but also contributed to a more optimistic market outlook.
- Mixed Economic Data: The U.S. February NAHB housing market index unexpectedly fell to a 5-month low of 36, below the expected 38, while the February Empire manufacturing survey slightly declined to 7.1, indicating uncertainty in economic recovery, as the market remains focused on upcoming corporate earnings and economic news.
See More
Medtronic Reports Decline in Q3 Profit
- Profit Decline: Medtronic's Q3 net profit fell to $1.143 billion, or $0.89 per share, down from $1.294 billion and $1.01 per share last year, indicating significant pressure on the company's profitability.
- Adjusted Earnings: Excluding items, Medtronic reported adjusted earnings of $1.750 billion, or $1.36 per share, showing some resilience in profitability despite the overall decline in net income.
- Revenue Growth: The company experienced an 8.7% year-over-year revenue increase, reaching $9.017 billion compared to $8.292 billion last year, indicating strong market demand.
- Future Guidance: Medtronic's full-year EPS guidance is set between $5.62 and $5.66, reflecting management's optimism about future earnings despite the current profit decline, suggesting confidence in business prospects.
See More
Medtronic's "Textbook" Turnaround: What is Its Potential in 2026?
Stock Performance: Medtronic's stock has shown a reversal pattern, indicating a critical pivot point, with analysts predicting potential price increases driven by improving growth outlook and market sentiment.
Investment Trends: Institutions hold over 80% of Medtronic's stock, with a bullish bias in buying activity expected to ramp up towards the end of 2025 and early 2026, aligning with stock price actions.
Financial Outlook: Medtronic reported solid quarterly results with revenues surpassing estimates, and analysts expect continued revenue growth and adjusted earnings per share (EPS) to exceed forecasts, despite some pressures from tariffs.
Long-Term Growth Potential: The company is focusing on long-term growth targets, with new products and expanding approvals expected to drive business, while maintaining a strong cash flow to support capital returns and dividend distributions.
See More
Medtronic Q3 Earnings Exceed Expectations
- Earnings Beat: Medtronic reported adjusted earnings of $1.36 per share for Q3, surpassing expectations of $1.33, indicating robust profitability amid challenging economic conditions.
- Neuroscience Growth: The Neuroscience portfolio generated $2.558 billion in revenue, a 4.1% increase, with mid-single-digit growth in Neuromodulation and Cranial & Spinal Technologies, reflecting strong market demand in this segment.
- Diabetes Business Surge: Revenue from the diabetes segment reached $796 million, up 14.8%, showcasing the company's innovation and acceptance in diabetes management products, further solidifying its market position.
- Positive Outlook: Medtronic reiterated its fiscal 2026 organic revenue growth forecast of approximately 5.5% and adjusted EPS guidance of $5.62 to $5.66, despite a potential $185 million tariff impact, demonstrating confidence in future growth prospects.
See More
